EXH 10.3
TRANSMONTAIGNE INC.
SECOND AMENDED AND RESTATED CREDIT AGREEMENT
DATED AS OF OCTOBER 30, 1998
BANKBOSTON, N.A., AGENT
TABLE OF CONTENTS
1. Definitions; Certain Rules of Construction 1
2. The Credits 26
2.1. Revolving Credit 26
2.1.1. Revolving Loan 26
2.1.2. Maximum Amount of Revolving Credit 26
2.1.3. Borrowing Requests 26
2.1.4. Revolving Loan Account; Revolving Notes 26
2.2. Swingline Credit 27
2.2.1. Swingline Loan 27
2.2.2. Borrowing Requests 27
2.2.3. Swingline Loan Account; Swingline Notes 27
2.2.4. Conversion of Swingline Loan into Revolving Loan 28
2.3. Term Credit 28
2.3.1. Term Loan 28
2.3.2. Term Loan Account; Term Notes 28
2.4. Letters of Credit 29
2.4.1. Issuance of Letters of Credit 29
2.4.2. Requests for Letters of Credit 29
2.4.3. Form and Expiration of Letters of Credit 30
2.4.4. Lenders' Participation in Letters of Credit 30
2.4.5. Presentation 30
2.4.6. Payment of Drafts 30
2.4.7. Uniform Customs and Practice 31
2.4.8. Subrogation 32
2.4.9. Modification, Consent, etc. 32
2.5. Application of Proceeds 33
2.5.1. Revolving Loan 33
2.5.2. Swingline Loan 33
2.5.3. Term Loan 33
2.5.4. [Intentionally Omitted] 33
2.5.5. Letters of Credit 33
2.5.6. Specifically Prohibited Applications 33
2.6. Nature of Obligations of Lenders to Make Extensions of Credit 33
3. Interest; Eurodollar Pricing Options; Fees 34
3.1. Interest 34
3.2. Eurodollar Pricing Options 34
3.2.1. Election of Eurodollar Pricing Options 34
3.2.2. Notice to Lenders and Company 35
3.2.3. Selection of Eurodollar Interest Periods 35
3.2.4. Additional Interest 36
3.2.5. Violation of Legal Requirements 36
3.2.6. Funding Procedure 36
3.3. Facility Fees 37
3.4. Letter of Credit Fees 37
3.5. Reserve Requirements, etc 37
3.6. Taxes 38
3.7. Capital Adequacy 38
3.8. Regulatory Changes 39
3.9. Computations of Interest and Fees 39
4. Payment 40
4.1. Payment at Maturity 40
4.2. Contingent Required Prepayments 40
4.2.1. Excess Credit Exposure 40
4.2.2. Letter of Credit Exposure 40
4.2.3. Capital Markets Transaction 40
4.3. [Intentionally Omitted]. 40
4.4. [Intentionally Omitted] 40
4.5. Voluntary Prepayments 40
4.6. Letters of Credit 41
4.7. Reborrowing; Application of Payments, etc. 41
4.7.1. Reborrowing 41
4.7.2. Order of Application 41
4.7.3. Payment with Accrued Interest, etc 41
4.7.4. Payments for Lenders 42
5. Conditions to Extending Credit 42
5.1. Conditions on Restatement Date 42
5.1.1. Notes 42
5.1.2. Perfection of Security 42
5.1.3. Payment of Fees 42
5.1.4. Legal Opinions 42
5.1.5. Letter of Credit Agreements 43
5.1.6. Prudential Consent 43
5.1.7. No Material Adverse Change 43
5.1.8. No Order, Injunction or Litigation. 43
5.1.9. Adverse Market Change. 43
5.1.10. Acquisition 43
5.1.11. Year 2000 Plan. 44
5.1.12. Pro forma Compliance 44
5.1.13. Subordinated Debentures 45
5.2. Conditions to Each Extension of Credit 45
5.2.1. Officer's Certificate 45
5.2.2. Proper Proceedings 45
5.2.3. Legality, etc 45
5.2.4. General 46
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6. General Covenants 46
6.1. Taxes and Other Charges; Accounts Payable 46
6.1.1. Taxes and Other Charges 46
6.1.2. Accounts Payable 46
6.2. Conduct of Business, etc. 47
6.2.1. Types of Business 47
6.2.2. Maintenance of Properties. 47
6.2.3. Statutory Compliance 47
6.2.4. Compliance with Material Agreements 47
6.2.5. Trading Policy 48
6.2.6. Subordinated Debentures 48
6.2.7. Inventory Accounting 48
6.2.8. Inactive Subsidiaries 48
6.3. Insurance 48
6.3.1. Property Insurance 48
6.3.2. Liability Insurance 48
6.4. Financial Statements and Reports 49
6.4.1. Annual Reports 49
6.4.2. Quarterly Reports 50
6.4.3. Year 2000 Compliant 51
6.4.4. Other Reports 51
6.4.5. Notice of Litigation 52
6.4.6. Notice of Defaults 52
6.4.7. ERISA Reports 52
6.4.8. Notice of Year 2000 Problem 52
6.4.9. Other Information; Audit 53
6.5. Certain Financial Tests 53
6.5.1. Fixed Charges Coverage 53
6.5.2. Adjusted Leverage 55
6.5.3. Consolidated Tangible Net Worth 56
6.6. Indebtedness 56
6.7. Guarantees; Letters of Credit 58
6.8. Liens 59
6.9. Investments and Acquisitions 60
6.10. Distributions 62
6.11. Merger, Consolidation and Dispositions of Assets 62
6.12. Lease Obligations 63
6.13. Issuance of Stock by Subsidiaries; Subsidiary Distributions 63
6.13.1. Issuance of Stock by Subsidiaries 63
6.13.2. No Restrictions on Subsidiary Distributions 63
6.14. Interest Rate Protection 63
6.15. Derivative Contracts 63
6.16. Negative Pledge Clauses 63
6.17. ERISA, etc. 64
6.18. Transactions with Affiliates 64
6.19. Open Positions 64
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6.20. Permitted Contango Market Transactions 64
6.21. Environmental Laws 65
6.21.1. Compliance with Law and Permits 65
6.21.2. Notice of Claims, etc. 65
7. Representations and Warranties 65
7.1. Organization and Business 65
7.1.1. The Company 65
7.1.2. Subsidiaries 65
7.1.3. Qualification 66
7.1.4. Capitalization 66
7.2. Financial Statements and Other Information; Material Agreements 66
7.2.1. Financial Statements and Other Information 66
7.2.2. Material Agreements 67
7.3. Agreements Relating to Financing Debt, Investments, etc. 68
7.4. Changes in Condition 68
7.5. Title to Assets 68
7.6. Operations in Conformity with Law, etc 68
7.7. Litigation 68
7.8. Authorization and Enforceability 69
7.9. No Legal Obstacle to Agreements 69
7.10. Defaults 70
7.11. Licenses, etc. 70
7.12. Tax Returns 70
7.13. Certain Business Representations 71
7.13.1. Labor Relations 71
7.13.2. Antitrust 71
7.13.3. Consumer Protection 71
7.13.4. Burdensome Obligations 71
7.13.5. Future Expenditures 71
7.14. Environmental Regulations 71
7.14.1. Environmental Compliance 71
7.14.2. Environmental Litigation 72
7.14.3. Hazardous Material 72
7.14.4. Environmental Condition of Properties 73
7.15. Pension Plans 73
7.16. [Intentionally Omitted] 73
7.17. Foreign Trade Regulations; Government Regulation; Margin Stock 73
7.17.1. Foreign Trade Regulations 73
7.17.2. Government Regulation 73
7.17.3. Margin Stock 73
7.18. Disclosure 74
7.19. Year 2000 Compliance 74
8. Defaults 74
8.1. Events of Default 74
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8.1.1. Payment 74
8.1.2. Specified Covenants 74
8.1.3. Other Covenants 74
8.1.4. Representations and Warranties 75
8.1.5. Cross Default, etc. 75
8.1.6. Ownership; Liquidation; etc. 75
8.1.7. Enforceability, etc. 76
8.1.8. Judgments 76
8.1.9. ERISA 76
8.1.10. Bankruptcy, etc. 77
8.1.11. Subordinated Debentures 77
8.2. Certain Actions Following an Event of Default 77
8.2.1. Terminate Obligation to Extend Credit 77
8.2.2. Specific Performance; Exercise of Rights 78
8.2.3. Acceleration 78
8.2.4. Enforcement of Payment; Credit Security; Setoff 78
8.2.5. Cumulative Remedies 78
8.3. Annulment of Defaults 78
8.4. Waivers 79
9. Guarantees 79
9.1. Guarantees of Credit Obligations 79
9.2. Continuing Obligation 79
9.3. Waivers with Respect to Credit Obligations 80
9.4. Lenders' Power to Waive, etc 82
9.5. Information Regarding the Company, etc. 82
9.6. Certain Guarantor Representations 83
9.7. Subrogation 83
9.8. Subordination 84
9.9. Future Subsidiaries; Further Assurances 84
10. Security 84
10.1. Credit Security 84
10.1.1. Pledged Stock 84
10.1.2. Pledged Rights 85
10.1.3. Pledged Indebtedness 85
10.1.4. Proceeds and Products 85
10.1.5. Excluded Property 85
10.2. [Intentionally Omitted] 85
10.3. Representations, Warranties and Covenants with
Respect to Credit Security 85
10.3.1. Pledged Stock 86
10.3.2. Pledged Indebtedness 86
10.3.3. [Intentionally Omitted] 86
10.3.4. No Liens or Restrictions on Transfer or
Change of Control 86
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10.3.5. [Intentionally Omitted]. 86
10.3.6. Trade Names 87
10.3.7. [Intentionally Omitted]. 87
10.3.8. Modifications to Credit Security 87
10.3.9. Delivery of Documents 87
10.3.10. Perfection of Credit Security 87
10.4. Administration of Credit Security 87
10.4.1. Use of Credit Security 87
10.4.2. [Intentionally Omitted] 87
10.4.3. Pledged Securities 88
10.5. Right to Realize upon Credit Security 88
10.5.1. Assembly of Credit Security; Receiver 88
10.5.2. General Authority 89
10.5.3. Marshaling, etc. 89
10.5.4. Sales of Credit Security 90
10.5.5. Sale Without Registration 91
10.5.6. Application of Proceeds 91
10.6. Custody of Credit Security 92
11. Expenses; Indemnity 92
11.1. Expenses 92
11.2. General Indemnity 93
11.3. Indemnity With Respect to Letters of Credit 93
12. Operations; Agent 93
12.1. Interests in Credits 93
12.2. Agent's Authority to Act, etc 94
12.3. Company to Pay Agent, etc 94
12.4. Lender Operations for Advances, Letters of Credit, etc 94
12.4.1. Advances 94
12.4.2. Letters of Credit 94
12.4.3. Agent to Allocate Payments, etc. 95
12.4.4. Delinquent Lenders; Nonperforming Lenders 95
12.5. Sharing of Payments, etc. 96
12.6. Amendments, Consents, Waivers, etc 96
12.7. Agent's Resignation 98
12.8. Concerning the Agent 98
12.8.1. Action in Good Faith, etc 98
12.8.2. No Implied Duties, etc. 98
12.8.3. Validity, etc. 99
12.8.4. Compliance 99
12.8.5. Employment of Agents and Counsel 99
12.8.6. Reliance on Documents and Counsel 99
12.8.7. Agent's Reimbursement 99
12.8.8. Agent's Fees. 100
12.9. Rights as a Lender 100
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12.10. Independent Credit Decision 100
12.11. Indemnification 100
13. Successors and Assigns; Lender Assignments and Participations 101
13.1. Assignments by Lenders 101
13.1.1. Assignees and Assignment Procedures 101
13.1.1A. Assignment Among Lenders 102
13.1.2. Terms of Assignment and Acceptance 102
13.1.3. Register 103
13.1.4. Acceptance of Assignment and Assumption 103
13.1.5. Federal Reserve Bank 104
13.1.6. Further Assurances 104
13.2. Credit Participants 104
13.3. Replacement of Lender 105
14. Confidentiality 106
15. Foreign Lenders 106
16. Notices 107
17. Course of Dealing; Amendments and Waivers 107
18. Defeasance 108
19. Venue; Service of Process 108
20. WAIVER OF JURY TRIAL 108
21. General 109
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EXHIBITS
2.1.4 - Form of Revolving Note
2.2.3 - Form of Swingline Note
2.3.2 - Form of Term Note
5.2.1 - Form of Officer's Certificate
6.2.5 - Risk and Product Management Policy Statement dated May 1998 of
TransMontaigne Product Services Inc., as amended by letter dated
October 30, 1998
6.4.1 - Form of Covenant Compliance Certificate
7 - Disclosure Schedule
7.1 - Company and Subsidiaries
7.2.2 - Material Agreements
7.3 - Financing Debt, Certain Investments, etc.
7.14 - Hazardous Material Sites
7.15 - Multi-employer and Defined Benefit Plans
12.1 - Percentage Interests
13.1.1 - Form of Assignment and Acceptance
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TRANSMONTAIGNE INC.
SECOND AMENDED AND RESTATED CREDIT AGREEMENT
This Agreement, dated as of October 30, 1998, is among TransMontaigne Inc.
(formerly known as TransMontaigne Oil Company), a Delaware corporation, the
Subsidiaries of TransMontaigne Inc. from time to time party hereto, the Lenders
from time to time party hereto and BankBoston, N.A., both in its capacity as a
Lender and in its capacity as agent for itself and the other Lenders.
RECITALS
The parties hereto are party to a Credit Agreement dated as of December 18,
1996, as amended and restated effective as of March 31, 1998 as amended by
Amendment No. 1 thereto dated as of June 30, 1998 (as so amended and restated,
the "Existing Credit Agreement").
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The Company has requested, and the Lenders have consented to, certain
amendments of the terms of the Existing Credit Agreement.
Accordingly, the parties hereby agree that the Existing Credit Agreement is
amended and restated, effective as of October 30, 1998, subject to satisfaction
of each of the conditions set forth in Section 5.1 hereof, as follows:
1. Definitions; Certain Rules of Construction . Certain capitalized terms
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are used in this Agreement and in the other Credit Documents with the specific
meanings defined below in this Section 1. Except as otherwise explicitly
specified to the contrary or unless the context clearly requires otherwise, (a)
the capitalized term "Section" refers to sections of this Agreement, (b) the
capitalized term "Exhibit" refers to exhibits to this Agreement, (c) references
to a particular Section include all subsections thereof, (d) the word
"including" shall be construed as "including without limitation", (e) accounting
terms not otherwise defined herein have the meaning provided under GAAP, (f)
terms defined in the UCC and not otherwise defined herein have the meaning
provided under the UCC, (g) references to a particular statute or regulation
include all rules and regulations thereunder and any successor statute,
regulation or rules, in each case as from time to time in effect and (h)
references to a particular Person include such Person's successors and assigns
to the extent not prohibited by this Agreement and the other Credit Documents.
References to "the date hereof" mean the date first set forth above.
1.1. "Accumulated Benefit Obligations" means the actuarial present value of
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the accumulated benefit obligations under any Plan, calculated in accordance
with Statement No. 87 of the Financial Accounting Standards Board.
1.2. "Acquisition" is defined in Section 2.5.3.
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1.3. "Acquisition Agreement" means the Stock Purchase Agreement dated as
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of September 13, 1998 between the Company and the Seller providing for the
acquisition by the Company of all of the outstanding common stock of LDEC.
1.4. "Adjusted Consolidated Funded Debt" means at any date the
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Consolidated Funded Debt of the Company and its Subsidiaries minus up to
$150,000,000 aggregate principal amount, if any, of Contango Market Obligations
of the Company and its Subsidiaries determined on a Consolidated basis.
1.5. "Adjusted Consolidated Net Tangible Assets" means at any date the
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Consolidated Net Tangible Assets of the Company and its Subsidiaries minus up to
$150,000,000 of petroleum inventory (but not less than the amount of Contango
Market Obligations deducted in calculating Adjusted Consolidated Funded Debt),
if any, which is the subject of Permitted Contango Market Transactions of the
Company and its Subsidiaries determined on a Consolidated basis.
1.6. "Adjusted Leverage Ratio" means on any date the quotient, expressed
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as a percentage, equal to the Adjusted Consolidated Funded Debt of the Company
and its Subsidiaries divided by the Adjusted Consolidated Net Tangible Assets of
the Company and its Subsidiaries.
1.7. "Affected Lender" is defined in Section 13.3.
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1.8. "Affiliate" means, with respect to the Company (or any other
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specified Person), any other Person directly or indirectly controlling,
controlled by or under direct or indirect common control with the Company, and
shall include (a) any executive officer or director or general partner of the
Company and (b) any Person of which the Company or any Affiliate (as defined in
clause (a) above) of the Company shall, directly or indirectly, beneficially own
either (i) at least 25% of the outstanding equity securities having the general
power to vote or (ii) at least 25% of all equity interests; provided, however,
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that Lion Oil Company, an Arkansas corporation, shall not be deemed to be an
Affiliate of the Company or of any Subsidiary of the Company under clause (b) of
this definition, unless the Company or such Subsidiary shall, directly or
indirectly, beneficially own either (x) at least 30% of the outstanding equity
securities having the general power to vote of Lion Oil Company or (y) at least
30% of all equity interests in Lion Oil Company.
1.9. "Agent" means BankBoston in its capacity as agent for the Lenders
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hereunder, as well as its successors and assigns in such capacity pursuant to
Section 12.7.
1.10. "Applicable Margin" means with respect to any portion of the Loan
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(other than the Term Loan) subject to a Eurodollar Pricing Option:
(a) on any date on which the Leverage Ratio is less than 25% or on
which the Company has a senior unsecured long-term debt rating issued and
maintained by S&P or ▇▇▇▇▇'▇ ("Senior Debt Rating") equal to or higher than
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BBB- from S&P or Baa3 from ▇▇▇▇▇'▇ ("Level I"), eleven-twentieths of one
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percent (.550%);
(b) on any date on which the Leverage Ratio is equal to or greater
than 25% and less than or equal to 40% or on which the Company has a Senior
Debt Rating equal to or higher than BB+ from S&P or Ba1 from ▇▇▇▇▇'▇
("Level II"), six-tenths of one percent (.600%);
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(c) on any date on which the Leverage Ratio is greater than 40% and
less than 50% or on which the Company has a Senior Debt Rating equal to or
higher than BB from S&P or Ba2 from ▇▇▇▇▇'▇ ("Level III"), seven-tenths of
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one percent (.700%);
(d) on any date on which the Leverage Ratio is greater than 50% and
less than 55% or on which the Company has a Senior Debt Rating equal to or
higher than BB from S&P or Ba3 from ▇▇▇▇▇'▇ ("Level IV"), nineteen-
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twentieths of one percent (.950%);
(e) on any date on which the Leverage Ratio is equal to or greater
than 55% and less than 60% ("Level V"), one and one-eighth percent
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(1.125%);
(f) on any date on which the Leverage Ratio is equal to or greater
than 60% and less than 65% ("Level VI"), one and one-quarter percent
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(1.250%); and
(g) on any date on which the Leverage Ratio is equal to or greater
than 65% ("Level VII"), one and three-quarters percent (1.750%).
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Notwithstanding the foregoing, in the event that on any date the Level
indicated by the Leverage Ratio and the Level indicated by the Senior Debt
Rating (such Levels to be determined as indicated in the next sentence in case
the Company receives a split rating from S&P and ▇▇▇▇▇'▇) are different, the
Applicable Margin shall be determined based on the higher of such two Levels.
In the event that on any date (i) the Level indicated by the S&P rating and the
Level indicated by the ▇▇▇▇▇'▇ rating are one Level apart, the Level indicated
by the Senior Debt Rating to be used for purposes of the preceding sentence
shall be the higher of such two Levels and (ii) the Level indicated by the S&P
rating and the Level indicated by the ▇▇▇▇▇'▇ rating are more than one Level
apart, the Level indicated by the Senior Debt Rating to be used for purposes of
the preceding sentence shall be the Level one below the higher of such two
Levels. For the purpose of this paragraph, the "highness" of a Level is
indicated by its number, e.g., Level II is "higher" than Level I.
By way of example, if the Company has a Senior Debt Rating of BBB- from S&P
and a Senior Debt Rating of Ba1 from ▇▇▇▇▇'▇, the Level indicated by the Senior
Debt Rating to be used for purposes of determining the Applicable Margin shall
be Level II and if the Company has a Senior Debt Rating of BBB- from S&P and a
Senior Debt
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Rating of Ba3 from ▇▇▇▇▇'▇, the Level indicated by the Senior Debt Rating to be
used for purposes of determining the Applicable Margin shall be Level III.
Notwithstanding the foregoing, if no Senior Debt Rating exists then the
Applicable Margin shall be based solely on the Level indicted by the Leverage
Ratio.
Furthermore, notwithstanding the foregoing, so long as any portion of the
Term Loan remains outstanding, the Applicable Margin for all Loans, except the
Term Loan, shall be that which corresponds with Level VII. Furthermore, such
Applicable Margin corresponding to Level VII shall increase to two percent
(2.000%) on and after June 30, 1999 if and so long as any portion of the Term
Loan remains outstanding on and after such date and will further increase to two
and one-quarter percent (2.250%) on and after September 30, 1999 if and so long
as any portion of the Term Loan remains outstanding on and after such date.
With respect to any portion of the Term Loan subject to a Eurodollar
Pricing Option, "Applicable Margin" means (i) until June 30, 1999, two and one-
quarter percent (2.250%), (ii) on and after June 30, 1999 until September 30,
1999, two and one-half percent (2.500%) and (iii) on and after September 30,
1999, two and three-quarters percent (2.750%).
For purposes of calculating the Applicable Margin, (i) the Leverage Ratio
shall be determined (A) as at the end of the most recent March, June, September
or December for which financial statements have been furnished (or are required
to have been furnished) by the Company to the Lenders pursuant to Section 6.4.1,
6.4.2 or 7.2.1 and (B) upon the consummation of any acquisition (giving effect
to such acquisition and the financing thereof) in connection with which the
Company is required to provide to the Lenders a certificate of a Financial
Officer pursuant to Section 6.9 and (ii) any adjustment in the Applicable Margin
shall be prospective and shall take effect on the fifth Business Day following
either the date upon which the financial statements referred to in the foregoing
clause (i) are furnished (or are required to be furnished) by the Company to the
Lenders pursuant to Section 6.4.1 or 6.4.2 or the date of consummation of an
acquisition referred to in the foregoing clause (i), as the case may be.
1.11. "Applicable Rate" means, at any date, the sum of:
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(a) (i) with respect to each portion of the Revolving Loan or
the Term Loan subject to a Eurodollar Pricing Option, the sum of the
Applicable Margin with respect thereto plus the Eurodollar Rate with
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respect to such Eurodollar Pricing Option; or
(ii) with respect to (A) each other portion of the Revolving
Loan, the Base Rate plus one-quarter of one percent (.250%) and (B)
each other portion of the Term Loan, the Base Rate plus three-
quarters of one percent (.750%);
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plus (b) an additional 2% effective on the day the Agent notifies the
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Company that the interest rates hereunder are increasing
as a result of the occurrence and continuance of an Event of Default
until the earlier of such time as (i) such Event of Default is no
longer continuing or (ii) such Event of Default is deemed no longer to
exist, in each case pursuant to Section 8.3.
Notwithstanding the foregoing, (x) if and so long as any portion of the
Term Loan remains outstanding on and after June 30, 1999, each rate of interest
provided in clause (a)(ii) of this definition shall be increased by one-quarter
of one percent (.250%) and (y) if and so long as any portion of the Term Loan
remains outstanding on and after September 30, 1999, each rate of interest
provided in clause (a)(ii) of this definition shall be increased by one-half of
one percent (.500%). Each increase under this paragraph shall be in addition to
any increase provided by clause (b) of this definition.
1.12. "Assignee" is defined in Section 13.1.1.
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1.13. "Assignment and Acceptance" is defined in Section 13.1.1.
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1.14. "BankBoston" means BankBoston, N.A.
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1.15. "BankBoston Fee Letter" is defined in Section 5.1.3.
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1.16. "Banking Day" means any day other than Saturday, Sunday or a day on
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which banks in Boston, Massachusetts are authorized or required by law or other
governmental action to close and, if such term is used with reference to a
Eurodollar Pricing Option, any day on which dealings are effected in the
Eurodollars in question by first-class banks in the inter-bank Eurodollar
markets in New York, New York.
1.17. "Bankruptcy Code" means Title 11 of the United States Code.
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1.18. "Bankruptcy Default" means an Event of Default referred to in
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Section 8.1.10.
1.19. "Base Rate" means, on any day, the greater of (a) the rate of
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interest announced by BankBoston at the Boston Office as its Base Rate or (b)
the sum of 1/2% plus the Federal Funds Rate.
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1.20. "Boston Office" means the principal banking office of BankBoston in
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Boston, Massachusetts.
1.21. "By-laws" means all written by-laws, rules, regulations and all
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other documents relating to the governance of any Person other than an
individual, or interpretive of the Charter of such Person, all as from time to
time in effect.
1.22. "Capital Markets Transaction" is defined in Section 4.2.3.
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1.23. "Capitalized Lease" means any lease which is required to be
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capitalized on the balance sheet of the lessee in accordance with GAAP,
including Statement Nos. 13 and 98 of the Financial Accounting Standards Board.
1.24. "Capitalized Lease Obligations" means the amount of the liability
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reflecting the aggregate discounted amount of future payments under all
Capitalized Leases calculated in accordance with GAAP, including Statement Nos.
13 and 98 of the Financial Accounting Standards Board.
1.25. "Cash Equivalents" means:
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(a) negotiable certificates of deposit, time deposits (including
sweep accounts), demand deposits and bankers' acceptances having a maturity
of nine months or less and issued by any United States financial
institution having capital and surplus and undivided profits aggregating at
least $100,000,000 and rated at least Prime-1 by ▇▇▇▇▇'▇ or A-1 by S&P or
issued by any Lender;
(b) corporate obligations having a maturity of nine months or less
and rated at least Prime-1 by ▇▇▇▇▇'▇ or A-1 by S&P or issued by any
Lender;
(c) any direct obligation of the United States of America or any
agency or instrumentality thereof, or of any state or municipality thereof,
(i) which has a remaining maturity at the time of purchase of not more than
one year or which is subject to a repurchase agreement with any Lender (or
any other financial institution referred to in clause (a) above)
exercisable within one year from the time of purchase and (ii) which, in
the case of obligations of any state or municipality, is rated at least Aa
by ▇▇▇▇▇'▇ or AA by S&P; and
(d) any mutual fund or other pooled investment vehicle rated at
least Aa by ▇▇▇▇▇'▇ or AA by S&P which invests principally in obligations
described above.
1.26. "CERCLA" means the federal Comprehensive Environmental Response,
------
Compensation and Liability Act of 1980.
1.27. "CERCLIS" means the federal Comprehensive Environmental Response
-------
Compensation Liability Information System List (or any successor document)
promulgated under CERCLA.
1.28. "Charter" means the articles of organization, certificate of
-------
incorporation, statute, constitution, joint venture agreement, partnership
agreement, trust indenture, limited liability company agreement or other charter
document of any Person other than an individual, each as from time to time in
effect.
14
1.29. "Closing Date" means the Restatement Date and each other date on
------------
which any extension of credit is made pursuant to Section 2.1, 2.2 or 2.4.
1.30. "Code" means the federal Internal Revenue Code of 1986, as amended.
----
1.31. "Commitment" means, with respect to any Lender, such Lender's
----------
obligations to extend the credits contemplated by the Credit Documents. The
original Commitments are set forth in Exhibit 12.1 and the current Commitments
are recorded from time to time in the Register.
1.32. "Company" means TransMontaigne Inc., a Delaware corporation.
-------
1.33. "Computation Covenants" means Sections 6.5, 6.6.7, 6.6.16, 6.6.18,
---------------------
6.9.5, 6.9.7, 6.9.8, 6.10.2, 6.11.1, 6.12.2, 6.19 and 6.20.
1.34. "Consolidated" and "Consolidating", when used with reference to any
------------ -------------
term, mean that term as applied to the accounts of the Company (or other
specified Person) and all of its Subsidiaries (or other specified group of
Persons), or such of its Subsidiaries as may be specified, consolidated (or
combined) or consolidating (or combining), as the case may be, in accordance
with GAAP and with appropriate deductions for minority interests in
Subsidiaries.
1.35. "Consolidated Current Liabilities" means, at any date, all amounts
--------------------------------
that are or should be carried as current liabilities on the balance sheet of the
Company and its Subsidiaries determined in accordance with GAAP on a
Consolidated basis, including the current portion of all Funded Debt except the
Term Loan.
1.36. "Consolidated Income from Operations" means, for any period, gross
-----------------------------------
revenues of the Company and its Subsidiaries, determined in accordance with GAAP
on a Consolidated basis, minus the sum of (a) the cost of operations of the
-----
Company and its Subsidiaries for such period, determined in accordance with GAAP
on a Consolidated basis, and (b) the selling, general and administrative
expenses of the Company and its Subsidiaries for such period, determined in
accordance with GAAP on a Consolidated basis.
1.37. "Consolidated Net Income" means, for any period, the net income (or
-----------------------
loss) of the Company and its Subsidiaries, determined in accordance with GAAP on
a Consolidated basis; provided, however, that Consolidated Net Income shall not
-------- -------
include:
(a) the income (or loss) of any Person accrued prior to the date
such Person becomes a Subsidiary or is merged into or consolidated with the
Company or any of its Subsidiaries;
(b) the income (or loss) of any Person (other than a Subsidiary) in
which the Company or any of its Subsidiaries has an ownership interest;
provided, however, that (i) Consolidated Net Income shall include amounts
-------- -------
in respect of the
15
income of such Person when actually received in cash by the Company or such
Subsidiary in the form of dividends or similar Distributions and (ii)
Consolidated Net Income shall be reduced by the aggregate amount of all
Investments, regardless of the form thereof, made by the Company or any of
its Subsidiaries in such Person for the purpose of funding any deficit or
loss of such Person;
(c) all amounts included in computing such net income (or loss) in
respect of the write-up of any asset or the retirement of any Indebtedness
or equity at less than face value after April 30, 1998;
(d) extraordinary and nonrecurring gains;
(e) the income of any Subsidiary to the extent the payment of such
income in the form of a Distribution or repayment of Indebtedness to the
Company or a Wholly Owned Subsidiary is not permitted, whether on account
of any Charter or By-law restriction, any agreement, instrument, deed or
lease or any law, statute, judgment, decree or governmental order, rule or
regulation applicable to such Subsidiary; and
(f) any after-tax gains or losses attributable to returned surplus
assets of any Plan.
1.38. "Consolidated Net Tangible Assets" means at any date the total of:
--------------------------------
(a) the total assets of the Company and its Subsidiaries
determined in accordance with GAAP on a Consolidated basis;
minus (b) Consolidated Current Liabilities;
-----
minus (c) all other liabilities of the Company and its Subsidiaries
-----
determined in accordance with GAAP on a Consolidated basis other than
liabilities for Funded Debt (excluding, however, any Permitted Preferred
Trust Securities or Permitted Subordinated Trust Indebtedness);
minus (d) the amount of intangible assets carried on the balance sheet
-----
of the Company and its Subsidiaries determined in accordance with GAAP on a
Consolidated basis, including goodwill, patents, patent applications,
copyrights, trademarks, tradenames, research and development expense,
organizational expense, annualized debt discount and expense, deferred
financing charges and debt acquisition costs;
minus (e) the amount at which any minority interest in a Subsidiary
-----
appears as a liability on the Consolidated balance sheet of the Company and
its Subsidiaries.
1.39. "Consolidated Tangible Net Worth" means, at any date, the total of:
-------------------------------
16
(a) stockholders' equity of the Company and its Subsidiaries
determined in accordance with GAAP on a Consolidated basis, excluding the
effect of any foreign currency translation adjustments (but in any event
including in such equity, on a Consolidated basis, any Permitted Preferred
Trust Securities or Permitted Subordinated Trust Indebtedness at the time
outstanding);
minus (b) the amount by which such stockholders' equity has been
-----
increased after April 30, 1998 by the items described in clauses (a)
through (f) of the definition of Consolidated Net Income;
minus (c) to the extent not already deducted from the amount in clause
-----
(a) above, (i) treasury stock, (ii) receivables due from an employee stock
ownership plan and (iii) Guarantees of Indebtedness incurred by an employee
stock ownership plan;
minus (d) the amount of intangible assets carried on the balance sheet of
-----
the Company and its Subsidiaries determined in accordance with GAAP on a
Consolidated basis, including goodwill, patents, patent applications,
copyrights, trademarks, tradenames, research and development expense,
organizational expense, unamortized debt discount and expense, deferred
financing charges and debt acquisition costs.
1.40. "Contango Market Obligations" means Indebtedness under the Revolving
---------------------------
Loan incurred for the purpose of financing the acquisition and maintenance of
petroleum inventory by the Company or a Subsidiary which is a Guarantor subject
to Permitted Contango Market Transactions, provided that for the period
commencing on the date the Company or the Guarantor is obligated to take
delivery of such petroleum inventory so purchased by it, and until and including
the date on which delivery to the purchaser is fulfilled, the Company or the
Guarantor has the right and ability to store such quantity and quality of
petroleum inventory in storage facilities owned, leased, operated or otherwise
controlled by the Company or the Guarantor.
1.41. "Credit Documents" means:
----------------
(a) this Agreement, the Notes, each Letter of Credit, each draft
presented or accepted under a Letter of Credit, the BankBoston Fee Letter,
the Intercreditor Agreement, the Pledge Agreement and each Interest Rate
Protection Agreement provided by a Lender (or an Affiliate of a Lender) to
the Company or any of its Subsidiaries, each as from time to time in
effect;
(b) all financial statements, reports, notices, mortgages,
assignments, UCC financing statements or certificates delivered to the
Agent or any of the Lenders by the Company, any of its Subsidiaries or any
other Obligor in connection herewith or therewith; and
17
(c) any other present or future agreement or instrument from time to
time entered into among the Company, any of its Subsidiaries or any other
Obligor, on one hand, and the Agent, any Letter of Credit Issuer or all the
Lenders, on the other hand, relating to, amending or modifying this
Agreement or any other Credit Document referred to above or which is stated
to be a Credit Document, each as from time to time in effect.
1.42. "Credit Obligations" means all present and future liabilities,
------------------
obligations and Indebtedness of the Company, any of its Subsidiaries or any
other Obligor owing to the Agent or any Lender under or in connection with this
Agreement or any other Credit Document, including without limitation obligations
in respect of principal, interest, reimbursement obligations under Letters of
Credit and Interest Rate Protection Agreements provided by a Lender (or an
Affiliate of a Lender), commitment fees, facility fees, Letter of Credit fees,
amounts provided for in Sections 3.2.4, 3.5, 3.6, 3.7, 3.8 and 11, amounts
payable under the BankBoston Fee Letter and other fees, charges, indemnities and
expenses from time to time owing hereunder or under any other Credit Document
(whether accruing before or after a Bankruptcy Default). Credit Obligations
shall include all obligations of the Company and its Subsidiaries owing under
the Existing Credit Agreement which are not paid in full and finally on or prior
to the Restatement Date.
1.43. "Credit Participant" is defined in Section 13.2.
------------------
1.44. "Credit Security" means all assets now or from time to time
---------------
hereafter subjected to a security interest, mortgage or charge (or intended or
required so to be subjected pursuant to this Agreement or any other Credit
Document) to secure the payment or performance of any of the Credit Obligations,
including the assets described in Section 10.1.
1.45. "Default" means any Event of Default and any event or condition
-------
which with the passage of time or giving of notice, or both, would become an
Event of Default and the filing against the Company, any of its Subsidiaries or
any other Obligor of a petition commencing an involuntary case under the
Bankruptcy Code.
1.46. "Delinquency Period" is defined in Section 12.4.4.
------------------
1.47. "Delinquent Lender" is defined in Section 12.4.4.
-----------------
1.48. "Delinquent Payment" is defined in Section 12.4.4.
------------------
1.49. "Distribution" means, with respect to the Company (or other
------------
specified Person):
(a) the declaration or payment of any dividend or distribution,
including dividends payable in shares of capital stock of or other equity
interests in the Company (or such specified Person), on or in respect of
any shares of any
18
class of capital stock of or other equity interests in the Company (or such
specified Person);
(b) the purchase, redemption or other retirement of any shares of
any class of capital stock of or other equity interest in the Company (or
such specified Person) or of options, warrants or other rights for the
purchase of such shares, directly, indirectly through a Subsidiary or
otherwise;
(c) any other distribution on or in respect of any shares of any
class of capital stock of or equity or other beneficial interest in the
Company (or such specified Person);
(d) any payment of principal or interest with respect to, or any
purchase, redemption or defeasance of, any Indebtedness of the Company (or
such specified Person) which by its terms or the terms of any agreement is
subordinated to the payment of the Credit Obligations;
(e) any loan or advance by the Company (or such specified Person)
to, or any other Investment by the Company (or such specified Person) in,
the holder of any shares of any class of capital stock of or equity
interest in the Company (or such specified Person), or any Affiliate of
such holder; and
(f) without duplication, any cash payment in respect of Permitted
Preferred Trust Securities or Permitted Subordinated Trust Indebtedness;
provided, however, that the term "Distribution" shall not include (i) dividends
-------- -------
payable in perpetual common stock of or other similar equity interests in the
Company (or such specified Person), (ii) payments in the ordinary course of
business in respect of (A) reasonable compensation paid to employees, officers
and directors or (B) advances to employees for travel expenses, drawing accounts
and similar expenditures, (iii) any loan or advance by the Company to any
Guarantor or (iv) any other loan or advance by the Company which constitutes an
Investment permitted under Section 6.9.5, 6.9.6 or 6.9.7.
1.50. "Eligible Assignee" means any of (a) a commercial bank organized
-----------------
under the laws of the United States, or any State thereof or the District of
Columbia; (b) a savings and loan association or savings bank organized under the
laws of the United States, or any State thereof or the District of Columbia; (c)
a commercial bank organized under the laws of any other country which is a
member of the Organization for Economic Cooperation and Development (the
"OECD"), or a political subdivision of any such country, provided that such bank
--------
is acting through a branch or agency located in the country in which it is
organized or another country which is also a member of the OECD; and (d) the
central bank of any country which is a member of the OECD; provided, however,
-------- -------
that no entity described in clause (a), (b), (c) or (d) above shall be an
Eligible Assignee unless it has total assets in excess of $1 billion and unless
debt obligations issued by such entity (or by a parent entity owning
beneficially all of the capital stock of such financial institution) are rated
"A3" or higher by ▇▇▇▇▇'▇ or "A-" or higher by S&P.
19
1.51. "Environmental Laws" means all applicable federal, state or local
------------------
statutes, laws, ordinances, codes, rules, regulations and guidelines (including
consent decrees and administrative orders) relating to public health and safety
and protection of the environment, including OSHA.
1.52. "ERISA" means the federal Employee Retirement Income Security Act of
-----
1974.
1.53. "ERISA Group Person" means the Company, any Subsidiary of the
------------------
Company and any Person which is a member of the controlled group or under common
control with the Company or any Subsidiary within the meaning of section 414 of
the Code or section 4001(a)(14) of ERISA.
1.54. "Eurodollars" means, with respect to any Lender, deposits of United
-----------
States Funds in a non-United States office or an international banking facility
of such Lender.
1.55. "Eurodollar Basic Rate" means, for any Eurodollar Interest Period,
---------------------
the sum of the Eurodollar Basic Reference Rates furnished by the Reference
Lenders to the Agent divided by the number of such Reference Lenders.
1.56. "Eurodollar Basic Reference Rate" means, for any Eurodollar Interest
-------------------------------
Period and any Reference Lender, the rate of interest at which Eurodollar
deposits in an amount comparable to the Percentage Interest of such Reference
Lender in the portion of the Loan as to which a Eurodollar Pricing Option has
been elected and which have a term corresponding to such Eurodollar Interest
Period are offered to such Reference Lender by first class banks in the inter-
bank Eurodollar market for delivery in immediately available funds at a
Eurodollar Office on the first day of such Eurodollar Interest Period as
determined by such Reference Lender at approximately 10:00 a.m. (Boston time)
two Banking Days prior to the date upon which such Eurodollar Interest Period is
to commence (which determination by such Reference Lender shall, in the absence
of demonstrable error, be conclusive) and as furnished promptly thereafter by
such Reference Lender to the Agent.
1.57. "Eurodollar Interest Period" means any period, selected as provided
--------------------------
in Section 3.2.1, of one, two, three or six months, commencing on any Banking
Day and ending on the corresponding date in the subsequent calendar month so
indicated (or, if such subsequent calendar month has no corresponding date, on
the last day of such subsequent calendar month); provided, however, that subject
-------- -------
to Section 3.2.3, if any Eurodollar Interest Period so selected would otherwise
begin or end on a date which is not a Banking Day, such Eurodollar Interest
Period shall instead begin or end, as the case may be, on the immediately
preceding or succeeding Banking Day as determined by the Agent in accordance
with the then current banking practice in the inter-bank Eurodollar market with
respect to Eurodollar deposits at the applicable Eurodollar Office, which
determination by the Agent shall, in the absence of demonstrable error, be
conclusive.
20
1.58. "Eurodollar Office" means such non-United States office or
-----------------
international banking facility of any Lender as the Lender may from time to time
select.
1.59. "Eurodollar Pricing Options" means the options granted pursuant to
--------------------------
Section 3.2.1 to have the interest on any portion of the Loan computed on the
basis of a Eurodollar Rate.
1.60. "Eurodollar Rate" for any Eurodollar Interest Period means the rate,
---------------
rounded upward to the nearest one-thousandth of one percent, obtained by
dividing (a) the Eurodollar Basic Rate for such Eurodollar Interest Period by
(b) an amount equal to 1 minus the Eurodollar Reserve Rate; provided, however,
----- -------- -------
that if at any time during such Eurodollar Interest Period the Eurodollar
Reserve Rate applicable to any outstanding Eurodollar Pricing Option changes,
the Eurodollar Rate for such Eurodollar Interest Period shall automatically be
adjusted to reflect such change, effective as of the date of such change.
1.61. "Eurodollar Reserve Rate" means the stated maximum rate (expressed
-----------------------
as a decimal) of all reserves (including any basic, supplemental, marginal or
emergency reserve or any reserve asset), if any, as from time to time in effect,
required by any Legal Requirement to be maintained by any Lender against (a)
"Eurocurrency liabilities" as specified in Regulation D of the Board of
Governors of the Federal Reserve System applicable to Eurodollar Pricing
Options, (b) any other category of liabilities that includes Eurodollar deposits
by reference to which the interest rate on portions of the Loan subject to
Eurodollar Pricing Options is determined, (c) the principal amount of or
interest on any portion of the Loan subject to a Eurodollar Pricing Option or
(d) any other category of extensions of credit, or other assets, that includes
loans subject to a Eurodollar Pricing Option by a non-United States office of
any of the Lenders to United States residents.
1.62. "Event of Default" is defined in Section 8.1.
----------------
1.63. "Exchange Act" means the federal Securities Exchange Act of 1934.
------------
1.64. "Existing Credit Agreement" is defined in the Recitals to this
-------------------------
Agreement.
1.65. "FACA" means the Federal Assignment of Claims Act as set forth in 31
----
U.S.C. (S) 3727 and 41 U.S.C. (S) 15.
1.66. "Facility Fee Rate" means:
-----------------
(a) on any date on which the Leverage Ratio is less than 25% or on
which the Company has a Senior Debt Rating equal to or higher than BBB-
from S&P or Baa3 from ▇▇▇▇▇'▇ ("Level I"), one-fifth of one percent
-------
(.200%);
(b) on any date on which the Leverage Ratio is equal to or greater
than 25% and less than 40% or on which the Company has a Senior Debt Rating
equal
21
to or higher than BB+ from S&P or Ba1 from ▇▇▇▇▇'▇ ("Level II"), one-
--------
quarter of one percent (.250%);
(c) on any date on which the Leverage Ratio is equal to or greater
than 40% and less than 55% or on which the Company has a Senior Debt Rating
equal to or higher than BB from S&P or Ba3 from ▇▇▇▇▇'▇ ("Level III"),
---------
three-tenths of one percent (.300%);
(d) on any date on which the Leverage Ratio is equal to or greater
than 55% and less than 60% ("Level IV"), three-eighths of one percent
--------
(.375%); and
(e) on any date on which the Leverage Ratio is equal to or greater
than 60% ("Level V"), one-half of one percent (.500%).
-------
Notwithstanding the foregoing, in the event that on any date the Level
indicated by the Leverage Ratio and the Level indicated by the Senior Debt
Rating (such Levels to be determined as indicated in the next sentence in case
the Company receives a split rating from S&P and ▇▇▇▇▇'▇) are different, the
Facility Fee Rate shall be determined based on the higher of such two Levels.
In the event that on any date the Level indicated by the S&P rating and the
Level indicated by the ▇▇▇▇▇'▇ rating are different, the Level indicated by the
Senior Debt Rating to be used for purposes of the preceding sentence shall be
the higher of such two Levels. For the purpose of this paragraph, the
"highness" of a Level is indicated by its number, e.g., Level II is "higher"
than Level I.
Notwithstanding the foregoing, if no Senior Debt Rating exists then the
Facility Fee Rate shall be based solely on the Level indicated by the Leverage
Ratio.
Furthermore, notwithstanding the foregoing, so long as any portion of the
Term Loan remains outstanding, the Facility Fee Rate on all Loans shall be that
which corresponds with Level IV.
For purposes of calculating the Facility Fee Rate, (i) the Leverage Ratio
shall be determined (A) as at the end of the most recent March, June, September
or December for which financial statements have been furnished (or are required
to have been furnished) by the Company to the Lenders pursuant to Section 6.4.1,
6.4.2 or 7.2.1 and (B) upon the consummation of any acquisition (giving effect
to such acquisition and the financing thereof) in connection with which the
Company is required to provide to the Lenders a certificate of a Financial
Officer pursuant to Section 6.9 and (ii) any adjustment in the Facility Fee Rate
shall be prospective and shall take effect on the fifth Business Day following
either the date upon which the financial statements referred to in the foregoing
clause (i) are furnished (or are required to be furnished) by the Company to the
Lenders pursuant to Section 6.4.1 or 6.4.2 or the date of consummation of an
acquisition referred to in the foregoing clause (i), as the case may be.
1.67. "Federal Funds Rate" means, for any day, the rate equal to the
------------------
weighted average (rounded upward to the nearest 1/8%) of the rates on overnight
federal funds
22
transactions with members of the Federal Reserve System arranged by federal
funds brokers, (a) as such weighted average is published for such day (or, if
such day is not a Banking Day, for the immediately preceding Banking Day) by the
Federal Reserve Bank of New York or (b) if such rate is not so published for
such Banking Day, as determined by the Agent using any reasonable means of
determination. Each determination by the Agent of the Federal Funds Rate shall,
in the absence of demonstrable error, be conclusive.
1.68. "Final Maturity Date" means December 31, 2003.
-------------------
1.69. "Final Term Loan Maturity Date" means June 30, 2000.
-----------------------------
1.70. "Financial Officer" of the Company (or other specified Person) means
-----------------
its chief executive officer, chief financial officer, chief operating officer,
chairman, president, treasurer or any of its vice presidents whose primary
responsibility is for its financial affairs, all of whose incumbency and
signatures have been certified to the Agent by the secretary or other
appropriate attesting officer of the Company (or such specified Person).
1.71. "Financing Debt" means each of the items described in clauses (a)
--------------
through (f) of the definition of the term "Indebtedness".
1.72. "Foreign Trade Regulations" means (a) any act that prohibits or
-------------------------
restricts, or empowers the President or any executive agency of the United
States of America to prohibit or restrict, exports to or financial transactions
with any foreign country or foreign national, (b) the regulations with respect
to certain prohibited foreign trade transactions set forth at 22 C.F.R. Parts
120-130 and 31 C.F.R. Part 500 and (c) any order, regulation, ruling,
interpretation, direction, instruction or notice relating to any of the
foregoing.
1.73. "Funded Debt" means all Indebtedness of the Company or other
-----------
specified Person which is payable more than one year from the date of creation
thereof and shall include (a) current maturities of such Indebtedness and (b)
all Indebtedness consisting of reimbursement obligations with respect to letters
of credit other than letters of credit issued to finance inventory purchases or
to secure other debt appearing on the balance sheet of the obligor.
1.74. "Funding Liability" means (a) any Eurodollar deposit which was used
-----------------
(or deemed by Section 3.2.6 to have been used) to fund any portion of the Loan
subject to a Eurodollar Pricing Option, and (b) any portion of the Loan subject
to a Eurodollar Pricing Option funded (or deemed by Section 3.2.6 to have been
funded) with the proceeds of any such Eurodollar deposit.
1.75. "GAAP" means generally accepted accounting principles as from time
----
to time in effect, including the statements and interpretations of the United
States Financial Accounting Standards Board and any predecessor or successor
entity.
23
1.76. "Guarantee" means, with respect to the Company (or other specified
---------
Person):
(a) any guarantee by the Company (or such specified Person), of the
payment or performance of, or any contingent obligation by the Company (or
such specified Person), in respect of, any Indebtedness or other obligation
of any primary obligor;
(b) any other arrangement whereby credit is extended to a primary
obligor on the basis of any promise or undertaking of the Company (or such
specified Person), including any binding "comfort letter" or "keep well
agreement" written by the Company (or such specified Person), to a creditor
or prospective creditor of such primary obligor, to (i) pay the
Indebtedness of such primary obligor, (ii) purchase an obligation owed by
such primary obligor, (iii) pay for the purchase or lease of assets or
services regardless of the actual delivery thereof or (iv) maintain the
capital, working capital, solvency or general financial condition of such
primary obligor;
(c) any liability of the Company (or such specified Person), as a
general partner of a partnership in respect of Indebtedness or other
obligations of such partnership;
(d) any liability of the Company (or such specified Person) as a
joint venturer of a joint venture in respect of Indebtedness or other
obligations of such joint venture; and
(e) reimbursement obligations of the Company (or such specified
Person) with respect to letters of credit, bankers acceptances, surety
bonds, other financial guarantees and Interest Rate Protection Agreements,
whether or not any of the foregoing are reflected on the balance sheet of the
Company (or such specified Person) or in a footnote thereto; provided, however,
-------- -------
that the term "Guarantee" shall not include endorsements for collection or
deposit in the ordinary course of business. The amount of any Guarantee and the
amount of Indebtedness resulting from such Guarantee shall be the maximum amount
that the guarantor may become obligated to pay in respect of the obligations
(whether or not such obligations are outstanding at the time of computation).
1.77. "Guarantor" means each Subsidiary listed on the signature page
---------
hereto or which subsequently becomes party to this Agreement as a Guarantor.
1.78. "Hazardous Material" means any pollutant, toxic or hazardous
------------------
material or waste, including any "hazardous substance" or "pollutant" or
"contaminant" as defined in section 101(14) of CERCLA or any other Environmental
Law or regulated as toxic or hazardous under RCRA or any other Environmental
Law.
24
1.79. "Indebtedness" means all obligations, contingent or otherwise, which
------------
in accordance with GAAP are required to be classified upon the balance sheet of
the Company (or other specified Person) as liabilities, but in any event
including (without duplication):
(a) borrowed money;
(b) indebtedness evidenced by notes, debentures or similar instruments;
(c) Capitalized Lease Obligations;
(d) the deferred purchase price of assets or securities, including
related noncompetition, consulting and stock repurchase obligations (other
than ordinary trade accounts payable within six months after the incurrence
thereof in the ordinary course of business);
(e) mandatory redemption or dividend obligations on capital stock (or
other equity);
(f) reimbursement obligations with respect to letters of credit, bankers
acceptances, surety bonds, other financial guarantees and Interest Rate
Protection Agreements;
(g) unfunded pension liabilities;
(h) obligations that are immediately and directly due and payable out of
the proceeds of or production from property;
(i) liabilities secured by any Lien existing on property owned or
acquired by the Company (or such specified Person), whether or not the
liability secured thereby shall have been assumed; and
(j) all Guarantees in respect of Indebtedness of others; provided
however, that the "Indebtedness" of any Person shall not include any
liability in respect of Permitted Preferred Trust Securities or Permitted
Subordinated Trust Indebtedness.
1.80. "Indemnified Party" is defined in Section 11.2.
-----------------
1.81. "Intercreditor Agreement" means the Intercreditor Agreement dated as
-----------------------
of April 17, 1997, as from time to time in effect, among the Company, the
Guarantors, the Lenders, the Agent and Prudential.
1.82. "Interest Rate Protection Agreement" means any interest rate swap,
----------------------------------
interest rate cap, interest rate hedge or other contractual arrangement that
converts
25
variable interest rates into fixed interest rates, fixed interest rates into
variable interest rates or other similar arrangements.
1.83. "Investment" means, with respect to the Company (or other specified
----------
Person):
(a) any share of capital stock, partnership or other equity
interest, evidence of Indebtedness or other security issued by any other
Person to the Company (or such other specified Person);
(b) any loan, advance or extension of credit to, or contribution to
the capital of, any other Person;
(c) any Guarantee of the Indebtedness of any other Person;
(d) any acquisition of all or any part of the business of any other
Person or the assets comprising such business or part thereof; and
(e) any other similar investment.
The investments described in the foregoing clauses (a) through (e) shall be
included in the term "Investment" whether they are made or acquired by purchase,
exchange, issuance of stock or other securities, merger, reorganization or any
other method; provided, however, that the term "Investment" shall not include
-------- -------
(i) current trade and customer accounts receivable for property leased, goods
furnished or services rendered in the ordinary course of business and payable in
accordance with customary trade terms, (ii) advances and prepayments to
suppliers for property leased, goods furnished and services rendered in the
ordinary course of business, (iii) advances to employees for travel expenses,
drawing accounts and similar expenditures, (iv) stock or other securities
acquired in connection with the satisfaction or enforcement of Indebtedness or
claims due to the Company (or such specified Person) or as security for any such
Indebtedness or claim or (v) demand deposits in banks or similar financial
institutions.
In determining the amount of outstanding Investments:
(A) the amount of any Investment shall be the cost thereof minus
-----
any returns of capital in cash on such Investment (determined in accordance
with GAAP without regard to amounts realized as income on such Investment);
(B) the amount of any Investment in respect of a purchase described
in clause (d) above shall be increased by the amount of any Indebtedness
assumed in connection with such purchase or secured by any asset acquired
in such purchase (whether or not any Indebtedness is assumed) or for which
any Person that becomes a Subsidiary is liable on the date on which the
securities of such Person are acquired; and
26
(C) no Investment shall be increased as the result of an increase in
the undistributed retained earnings of the Person in which the Investment
was made or decreased as a result of an equity interest in the losses of
such Person.
1.84. "LDEC" means ▇▇▇▇▇ ▇▇▇▇▇▇▇ Energy Corp., a Delaware corporation.
----
1.85. "Legal Requirement" means any present or future requirement imposed
-----------------
upon any of the Lenders or the Company and its Subsidiaries by any law, statute,
rule, regulation, directive, order, decree, guideline (or any interpretation
thereof by courts or of administrative bodies) of the United States of America,
or any jurisdiction in which any Eurodollar Office is located or any state or
political subdivision of any of the foregoing, or by any board, governmental or
administrative agency, central bank or monetary authority of the United States
of America, any jurisdiction in which any Eurodollar Office is located, or any
political subdivision of any of the foregoing. Any such requirement imposed on
any of the Lenders not having the force of law shall be deemed to be a Legal
Requirement if such Lender reasonably believes that compliance therewith is in
the best interest of such Lender.
1.86. "Lender" means each of the Persons listed as lenders on the
------
signature page hereto, including BankBoston in its capacity as a Lender and such
other Persons who may from time to time own a Percentage Interest in the Credit
Obligations, but the term "Lender" shall not include any Credit Participant.
1.87. "Lending Officer" means such individuals whom the Agent may
---------------
designate by notice to the Company from time to time as an officer who may
receive telephone requests for borrowings under Sections 2.1.3 and 2.2.2.
1.88. "Letter of Credit" is defined in Section 2.4.1.
----------------
1.89. "Letter of Credit Exposure" means, at any date, the sum of (a) the
-------------------------
aggregate face amount of all drafts that may then or thereafter be presented by
beneficiaries under all Letters of Credit then outstanding, plus (b) the
----
aggregate face amount of all drafts that the Letter of Credit Issuer has
previously accepted under Letters of Credit but has not paid.
1.90. "Letter of Credit Fee Rate" means on any date an amount equal to the
-------------------------
Applicable Margin applicable to the Revolving Loan.
1.91. "Letter of Credit Issuer" means, for any Letter of Credit,
-----------------------
BankBoston or, in the event BankBoston does not for any reason issue a requested
Letter of Credit, another Lender designated by the Agent to issue such Letter of
Credit in accordance with Section 2.4.
27
1.92. "Leverage Ratio" means on any date the quotient, expressed as a
--------------
percentage, equal to the Consolidated Funded Debt of the Company and its
Subsidiaries divided by the Consolidated Net Tangible Assets of the Company and
its Subsidiaries.
1.93. "Lien" means, with respect to the Company (or any other specified
----
Person):
(a) Any lien, encumbrance, mortgage, pledge, charge or security
interest of any kind upon any property or assets of the Company (or such
specified Person), whether now owned or hereafter acquired, or upon the
income or profits therefrom;
(b) The acquisition of, or the agreement to acquire, any property or
asset upon conditional sale or subject to any other title retention
agreement, device or arrangement (including a Capitalized Lease);
(c) The sale, assignment, pledge or transfer for security of any
accounts, general intangibles or chattel paper of the Company (or such
specified Person), with or without recourse;
(d) The transfer of any tangible property or assets for the purpose
of subjecting such items to the payment of previously outstanding
Indebtedness in priority to payment of the general creditors of the Company
(or such specified Person); and
(e) The existence for a period of more than 120 consecutive days of
any Indebtedness against the Company (or such specified Person) which if
unpaid would by law or upon a Bankruptcy Default be given any priority over
general creditors.
1.94. "Loan" means the aggregate outstanding amount of the Revolving Loan,
----
Swingline Loan and Term Loan, as applicable.
1.95. "Loan Account" means each Revolving Loan Account, Swingline Loan
------------
Account and Term Loan Account, as applicable.
1.96. "Mandatory Borrowing" is defined in Section 2.2.4.
-------------------
1.97. "Margin Stock" means "margin stock" within the meaning of
------------
Regulations G, T, U or X of the Board of Governors of the Federal Reserve
System.
1.98. "Master Shelf Agreement" is defined in Section 6.6.12.
----------------------
1.99. "Material Adverse Change" means, since any specified date or from
-----------------------
the circumstances existing immediately prior to the happening of any specified
event, a material adverse change in the business, assets, financial condition or
income of the
28
Company and its Subsidiaries on a Consolidated basis, whether as a result of (a)
general economic conditions affecting the petroleum industry, (b) difficulties
in obtaining supplies and raw materials, (c) fire, flood or other natural
calamities, (d) environmental pollution, (e) regulatory changes, judicial
decisions, war or other governmental action or (f) any other event or
development, whether or not related to those enumerated above.
1.100. "Material Adverse Effect" means (i) a materially adverse effect on
-----------------------
the business, assets, operations, prospects, income or condition, financial or
otherwise, of the Company and its Subsidiaries on a Consolidated basis, (ii)
material impairment of the ability of the Company or any of its Subsidiaries to
perform any of their obligations under this Agreement or any of the other Credit
Documents, or (iii) material impairment of the rights of or benefits available
to the Lenders under this Agreement or any of the other Credit Documents.
1.101. "Material Agreements" is defined in Section 7.2.2.
-------------------
1.102. "Maximum Amount of Revolving Credit" is defined in Section 2.1.2.
----------------------------------
1.103. "▇▇▇▇▇'▇" means ▇▇▇▇▇'▇ Investors Service, Inc.
-------
1.104. "Multiemployer Plan" means any Plan that is a "multiemployer plan"
------------------
as defined in section 4001(a)(3) of ERISA.
1.105. "New Equity Securities" means common stock, preferred stock and
---------------------
other equity securities issued by the Company after the Restatement Date
(excluding any such stock and securities which are redeemable at the option of
the holder thereof prior to the eleventh anniversary of the date on which the
Term Loan is repaid in full) and shall include, without limiting the foregoing,
any Permitted Subordinated Trust Indebtedness.
1.106. "Nonperforming Lender" is defined in Section 12.4.4.
--------------------
1.107. "Notes" means the Revolving Notes, Swingline Notes and the Term
-----
Notes, as applicable.
1.108. "Obligor" means the Company, each Guarantor and each Person
-------
guaranteeing, providing collateral for or subordinating obligations to, the
Credit Obligations.
1.109. "Open Position" means any difference (whether positive or negative)
-------------
between (a) the number of barrels of petroleum product the Company and its
Subsidiaries hold in inventory or have contracted to buy and (b) the number of
barrels of petroleum product the Company and its Subsidiaries have contracted to
sell.
1.110. "OSHA" means the federal Occupational Health and Safety Act.
----
1.111. "Overdue Rate" is defined in Section 3.1.
------------
29
1.112. "Payment Date" means (a) the last Banking Day of each calendar
------------
month occurring after the Restatement Date and (b) the Final Maturity Date.
1.113. "PBGC" means the Pension Benefit Guaranty Corporation or any
----
successor entity.
1.114. "Percentage Interest" means (a) at all times when no Event of
-------------------
Default under Section 8.1.1 and no Bankruptcy Defaults exists, the ratio that
the respective Commitments of the Lenders bear to the total Commitments of all
Lenders as from time to time in effect and reflected in the Register, and (b) at
all other times, the ratio that the respective amounts of the outstanding Credit
Obligations owing to the Lenders in respect of extensions of credit under
Section 2 to the total outstanding Credit Obligations owing to all Lenders.
1.115. "Performing Lender" is defined in Section 12.4.4.
-----------------
1.116. "Permitted Contango Market Transaction" means a transaction in
-------------------------------------
which the Company or any Guarantor either (i) establishes a position using New
York Mercantile Exchange Future contracts to purchase petroleum inventory for
future delivery to it, or (ii) purchases or commits to purchase petroleum
inventory for future delivery to it, and contemporaneously with such purchase
(described in the preceding subsection (i) or (ii)) either (a) establishes one
or more positions using New York Mercantile Exchange contracts to resell at a
date subsequent to such aforementioned delivery date, or (b) enters into a
contract with a Qualified Person to resell at a date subsequent to such delivery
date, a similar aggregate quantity and quality of petroleum inventory as so
purchased by the Company or such Guarantor, as applicable, and at an aggregate
price greater than the Indebtedness incurred to finance the costs of acquiring
and maintaining the petroleum inventory that is the subject of such transaction.
1.117. "Permitted Preferred Trust Securities" means any securities made up
------------------------------------
of trust participation interests, preferred stock or limited partnership
interests, issued by a Subsidiary of the Company, provided that:
(a) the issuer of such securities has no assets other than
Permitted Subordinated Trust Indebtedness owing to it by the Company;
(b) payments upon such securities can be made only out of funds
received in payment of such Permitted Subordinated Trust Indebtedness;
(c) all payments upon such securities can in all circumstances, at
the election of the Company (acting either directly or through such
issuer), be deferred for the greater of (i) one or more payment periods,
(ii) a period expiring not earlier than the day after the Final Maturity
Date in effect at the time of issuance of such securities and (iii) a
period of not less than 12 months;
30
(d) such securities are convertible at the option of the Company
into common stock of the Company; and
(e) such securities are not redeemable at the option of the holder
thereof prior to the eleventh anniversary of the date on which the Term
Loan is repaid in full.
1.118. "Permitted Subordinated Trust Indebtedness" means (a) any
-----------------------------------------
promissory notes or debentures issued by the Company to any issuer of Permitted
Preferred Trust Securities, provided that such notes or debentures (1) are
subordinated to the Credit Obligations upon terms satisfactory to the Agent, (2)
do not exceed in aggregate principal amount or liquidation value at any time
outstanding $150,000,000, (3) do not require any principal payments to be made
until more than eleven years after the date on which the Term Loan is repaid in
full, and (4) provide that all payments upon such notes or debentures can in all
circumstances, at the election of the Company, be deferred for the greater of
(i) one or more payment periods, (ii) a period expiring not earlier than the day
after the Final Maturity Date in effect at the time of issuance of such notes or
debentures, and (iii) a period of not less than 12 months, and (b) any guaranty
by the Company that the issuer of such Permitted Preferred Trust Securities will
make required distributions thereon to the extent it has funds available
therefor, provided that such guaranty is subordinated to the Credit Obligations
upon terms satisfactory to the Agent.
1.119. "Person" means any present or future natural person or any
------
corporation, association, partnership, joint venture, limited liability, joint
stock or other company, business trust, trust, organization, business or
government or any governmental agency or political subdivision thereof.
1.120. "Plan" means, at any date, any pension benefit plan subject to
----
Title IV of ERISA maintained, or to which contributions have been made or are
required to be made, by any ERISA Group Person within six years prior to such
date.
1.121. "Pledge Agreement" means the Pledge Agreement dated as of April 17,
----------------
1997, as from time to time in effect, among the Company, the Guarantors and the
Agent, as collateral agent.
1.122. "Pledged Indebtedness" is defined in Section 10.1.3.
--------------------
1.123. "Pledged Rights" is defined in Section 10.1.2.
--------------
1.124. "Pledged Securities" means the Pledged Stock, the Pledged Rights
------------------
and the Pledged Indebtedness, collectively.
1.125. "Pledged Stock" is defined in Section 10.1.1.
-------------
1.126. "Prudential" is defined in Section 6.6.12.
----------
31
1.127. "Qualified Person" means either (a) a Person which has a Senior
----------------
Debt Rating equal to or higher than BBB- from S&P and a Senior Debt Rating equal
to or higher than Baa3 from Moody's or (b) a Person all of whose obligations to
the Company or any Subsidiary described in clause (b) of the definition of
"Permitted Contango Market Transaction" herein (i) are irrevocably and
unconditionally guaranteed by a Person having the Senior Debt Ratings required
by the preceding clause (a) and/or are secured by an irrevocable letter of
credit issued by one or more commercial banks having Senior Debt Ratings equal
to or higher than A- from S&P and equal to or higher than A3 from Moody's.
1.128. "RCRA" means the federal Resource Conservation and Recovery Act, 42
----
U.S.C. (S) 690, et seq.
-- ---
1.129. "Reference Lender" means BankBoston.
----------------
1.130. "Register" is defined in Section 13.1.3.
--------
1.131. "Replacement Lender" is defined in Section 13.3.
------------------
1.132. "Required Lenders" means, with respect to any approval, consent,
----------------
modification, waiver or other action to be taken by the Agent or the Lenders
under the Credit Documents which require action by the Required Lenders, such
Lenders as own at least 51% of the Percentage Interests (other than Delinquent
Lenders during the existence of a Delinquency Period so long as such Delinquent
Lender is treated the same as the other Lenders with respect to any actions
being taken by the Required Lenders); provided, however, that with respect to
-------- -------
any matters referred to in paragraph (b) of the proviso to Section 12.6,
Required Lenders means such Lenders as own at least the portion of the
Percentage Interests required by such paragraph (b).
1.133. "Restatement Date" means October 30, 1998 or such later date as may
----------------
be agreed to by the Company and the Agent and on which all conditions to closing
in Section 5 have been satisfied.
1.134. "Revolving Loan" is defined in Section 2.1.4.
--------------
1.135. "Revolving Loan Account" is defined in Section 2.1.4.
----------------------
1.136. "Revolving Loan Percentage Interest" means the percentage interest
----------------------------------
of each Lender in the Commitments relating to the Revolving Loan.
1.137. "Revolving Notes" is defined in Section 2.1.4.
---------------
1.138. "Securities Act" means the federal Securities Act of 1933.
--------------
1.139. "Seller" means ▇▇▇▇▇ ▇▇▇▇▇▇▇ Corporation, a New York corporation.
------
32
1.140. "Senior Debt Rating" is defined in Section 1.10.
------------------
1.141. "S&P" means Standard & Poor's, a Division of The ▇▇▇▇▇▇-▇▇▇▇
---
Companies, Inc.
1.142. "Subordinated Debentures" is defined in Section 6.6.10.
-----------------------
1.143. "Subordinated Debentures Agreement" is defined in Section 7.2.2.
---------------------------------
1.144. "Subordinated Debentures Guarantee" is defined in Section 6.7.5.
---------------------------------
1.145. "Subsidiary" means any Person of which the Company (or other
----------
specified Person) shall at the time, directly or indirectly through one or more
of its Subsidiaries, (a) own more than 50% of the outstanding capital stock (or
other shares of beneficial interest) entitled to vote generally or (b) hold more
than 50% of the partnership, joint venture or similar interests.
1.146. "Swingline Lender" means BankBoston, in its capacity as swingline
----------------
lender hereunder.
1.147. "Swingline Loan" is defined in Section 2.2.3.
--------------
1.148. "Swingline Loan Account" is defined in Section 2.2.3.
----------------------
1.149. "Swingline Note" is defined in Section 2.2.3.
--------------
1.150. "Swingline Rate" means the rate equal to the sum of (a) the Federal
--------------
Funds Rate plus the Applicable Margin, plus (b) an additional 2% per annum
---- ----
effective on the day the Agent notifies the Company that the interest rates
hereunder are increasing as a result of the occurrence and continuance of an
Event of Default until the earlier of such time as (i) such Event of Default is
no longer continuing or (ii) such Event of Default is deemed no longer to exist,
in each case pursuant to Section 8.3.
1.151. "Syndication Agent" means BancBoston ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ Inc.
-----------------
1.152. "Tax" means any present or future tax, levy, duty, impost,
---
deduction, withholding or other charges of whatever nature at any time required
by any Legal Requirement (a) to be paid by any Lender or (b) to be withheld or
deducted from any payment otherwise required hereby to be made to any Lender, in
each case on or with respect to its obligations hereunder, the Loan, any payment
in respect of the Credit Obligations or any Funding Liability not included in
the foregoing; provided, however, that the term "Tax" shall not include any
-------- -------
franchise tax or taxes imposed upon or measured by the gross or net income of
such Lender (or withholding taxes with respect to such taxes).
1.153. "Term Loan" is defined in Section 2.3.1.
---------
33
1.154. "Term Loan Account" is defined in Section 2.3.2.
-----------------
1.155. "Term Loan Percentage Interest" means the percentage interest of
-----------------------------
each Lender in the Commitments relating to the Term Loan.
1.156. "Term Note" is defined in Section 2.3.2.
---------
1.157. "UCC" means the Uniform Commercial Code as in effect in
---
Massachusetts on the date hereof; provided, however, that with respect to the
-------- -------
perfection of the Agent's Lien in the Credit Security and the effect of
nonperfection thereof, the term "UCC" means the Uniform Commercial Code as in
effect in any jurisdiction the laws of which are made applicable by Section 9-
103 of the Uniform Commercial Code as in effect in Massachusetts.
1.158. "Uniform Customs and Practice" is defined in Section 2.4.7.
----------------------------
1.159. "United States Funds" means such coin or currency of the United
-------------------
States of America as at the time shall be legal tender therein for the payment
of public and private debts.
1.160. "Wholly Owned Subsidiary" means any Subsidiary of which all of the
-----------------------
outstanding capital stock (or other shares of beneficial interest) entitled to
vote generally (other than directors' qualifying shares) is owned by the Company
(or other specified Person) directly, or indirectly through one or more Wholly
Owned Subsidiaries.
1.161. "Year 2000 Compliant" is defined in Section 7.19.
-------------------
1.162. "Year 2000 Plan" is defined in Section 5.1.11.
--------------
2. The Credits.
-----------
2.1. Revolving Credit.
----------------
2.1.1. Revolving Loan. Subject to all the terms and conditions of
--------------
this Agreement and so long as no Default exists, from time to time on and
after the Restatement Date and prior to the Final Maturity Date the Lenders
will, severally in accordance with their respective Revolving Loan
Percentage Interests, make loans to the Company in such amounts as may be
requested by the Company in accordance with Section 2.1.3. The sum of the
aggregate principal amount of loans made under this Section 2.1.1 at any
one time outstanding plus the Swingline Loan plus the Letter of Credit
---- ----
Exposure shall in no event exceed the Maximum Amount of Revolving Credit.
In no event will the principal amount of loans at any one time outstanding
made by any Lender pursuant to this Section 2.1 exceed such Lender's
Commitment.
34
2.1.2. Maximum Amount of Revolving Credit. The term "Maximum
---------------------------------- -------
Amount of Revolving Credit" means the lesser of (a) $350,000,000 or (b) the
--------------------------
amount (in an integral multiple of $1,000,000 equal to or greater than
$10,000,000) to which the then applicable amount set forth in clause (a)
shall have been irrevocably reduced from time to time by notice from the
Company to the Agent.
2.1.3. Borrowing Requests. The Company may from time to time
------------------
request a loan under Section 2.1.1 by providing to the Agent a notice
(which may be given by a telephone call received by a Lending Officer if
promptly confirmed in writing). Such notice must be not later than 2:00
p.m. (Boston time) on the same Banking Day as the requested Closing Date
for such loan (third Banking Day prior to the requested Closing Date of
such loan if any portion of such loan will be subject to a Eurodollar
Pricing Option on the requested Closing Date). The notice must specify (a)
the amount of the requested loan (which shall be not less than $500,000 and
an integral multiple of $100,000) and (b) the requested Closing Date
therefor (which shall be a Banking Day). Upon receipt of such notice, the
Agent will promptly inform each other Lender (by telephone or otherwise).
Each such loan will be made at the Boston Office by depositing the amount
thereof to the general account of the Company with the Agent. In
connection with each such loan, the Company shall furnish to the Agent a
certificate in substantially the form of Exhibit 5.2.1.
2.1.4. Revolving Loan Account; Revolving Notes. The Agent will
---------------------------------------
establish on its books a loan account for the Company (the "Revolving Loan
--------------
Account") which the Agent shall administer as follows: (a) the Agent shall
-------
add to the Revolving Loan Account, and the Revolving Loan Account shall
evidence, the principal amount of all loans from time to time made by the
Lenders to the Company pursuant to Section 2.1.1 and (b) the Agent shall
reduce the Revolving Loan Account by the amount of all payments made on
account of the Indebtedness evidenced by the Revolving Loan Account. The
aggregate principal amount of the Indebtedness evidenced by the Revolving
Loan Account is referred to as the "Revolving Loan". The Revolving Loan
--------------
shall be deemed owed to each Lender severally in accordance with such
Lender's Revolving Loan Percentage Interest, and all payments credited to
the Revolving Loan Account shall be for the account of each Lender in
accordance with its Revolving Loan Percentage Interest. The Company's
obligations to pay each Lender's Revolving Loan Percentage Interest in the
Revolving Loan shall be evidenced by a separate note of the Company in
substantially the form of Exhibit 2.1.4 (the "Revolving Notes"), payable to
---------------
each Lender in maximum principal amount equal to such Lender's Revolving
Loan Percentage Interest in the Revolving Loan.
35
2.2. Swingline Credit.
----------------
2.2.1. Swingline Loan. Subject to all the terms and conditions of
--------------
this Agreement and so long as no Default exists, from time to time on and
after the Restatement Date and prior to the Final Maturity Date, the
Swingline Lender will make loans to the Company in such amounts as may be
requested by the Company in accordance with Section 2.2.2. The sum of the
aggregate principal amount of loans made under this Section 2.2 at any one
time outstanding plus the Revolving Loan plus the Letter of Credit Exposure
---- ----
shall in no event exceed the Maximum Amount of Revolving Credit. In no
event will the principal amount of loans made pursuant to this Section 2.2
at any one time outstanding exceed $20,000,000.
2.2.2. Borrowing Requests. The Company may from time to time
------------------
request a loan under Section 2.2.1 by providing to the Swingline Lender a
notice (which may be given by a telephone call received by a Lending
Officer). Such notice must be not later than 2:00 p.m. (Boston time) on
the requested Closing Date (which must be a Banking Day) for such loan.
Each such loan will be made at the Boston Office by depositing the amount
thereof to the general account of the Company with the Swingline Lender.
In connection with each such loan, if the Swingline Lender shall so
request, the Company shall furnish to the Swingline Lender a certificate in
substantially the form of Exhibit 5.2.1.
2.2.3. Swingline Loan Account; Swingline Notes. The Swingline
---------------------------------------
Lender will establish on its books a loan account for the Company (the
"Swingline Loan Account") which the Swingline Lender shall administer as
----------------------
follows: (a) the Swingline Lender shall add to the Swingline Loan Account,
and the Swingline Loan Account shall evidence, the principal amount of all
loans from time to time made by the Swingline Lender to the Company
pursuant to Section 2.2.1 and (b) the Swingline Lender shall reduce the
Swingline Loan Account by the amount of all payments made on account of the
Indebtedness evidenced by the Swingline Loan Account. The aggregate
principal amount of the Indebtedness evidenced by the Swingline Loan
Account is referred to as the "Swingline Loan". The Company's obligation
--------------
to pay the Swingline Loan shall be evidenced by a note of the Company in
substantially the form of Exhibit 2.2.3 (the "Swingline Note"), payable to
--------------
the Swingline Lender in maximum principal amount equal to the Swingline
Loan.
2.2.4. Conversion of Swingline Loan into Revolving Loan. On any
------------------------------------------------
Banking Day after the occurrence and during the continuance of an Event of
Default, the Swingline Lender may, in its sole discretion, give notice to
the other Lenders and the Company that the Swingline Loan shall be paid in
full with a mandatory borrowing under the Revolving Loan (the "Mandatory
---------
Borrowing"). Such a notice of a Mandatory Borrowing shall be deemed to
---------
have been automatically given upon a Bankruptcy Default or upon the
exercise of any of the
36
remedies provided in Section 8.2. Upon the giving of any such notice or
deemed notice, a Mandatory Borrowing under the Revolving Loan in the amount
of the Swingline Loan shall be made on the next Banking Day from all
Lenders in accordance with their respective Revolving Loan Percentage
Interests in the Revolving Loan, and the proceeds thereof shall be applied
to the Swingline Lender as a repayment of the Swingline Loan. Each Lender
irrevocably agrees to make such loan pursuant to each such Mandatory
Borrowing notice in the amount and in the manner specified above in this
Section 2.2.4, notwithstanding (a) whether any conditions specified in
Section 5 have been satisfied, (b) that a Default or an Event of Default
has occurred and is continuing or (c) the date of such Mandatory Borrowing.
In the event that any Mandatory Borrowing cannot for any reason be made on
the date required above (including as a result of the commencement of a
proceeding under the Bankruptcy Code), each Lender shall promptly purchase
from the Swingline Lender as of the date the Mandatory Borrowing otherwise
would have occurred such participation in the Swingline Loan as shall be
necessary to cause the Lenders to share in the Swingline Loan ratably based
upon their respective Revolving Loan Percentage Interests in the Revolving
Loan. In the event of such participations, all interest payable on the
Swingline Loan shall be for the account of the Swingline Lender until the
date on which the participations are required to be purchased and, to the
extent attributable to the purchased participations, shall be payable to
the participants from and after such date. At the time any such purchase of
participations is actually made, the purchasing Lender shall pay the
Swingline Lender interest on the principal amount of the participation
purchased at the overnight Federal Funds Rate for each day, commencing with
the date the Mandatory Borrowing otherwise would have occurred, to the date
of payment for such participation.
2.3. Term Credit.
-----------
2.3.1. Term Loan. Subject to all the terms and conditions of this
---------
Agreement and so long as no Default exists, on the Restatement Date the
Lenders will, in accordance with their respective Commitments to make the
Term Loan, severally lend to the Company as a term loan, an aggregate
amount of $150,000,000. The aggregate principal amount of the loan made
pursuant to this Section 2.2.1 at any one time outstanding is referred to
as the "Term Loan". In connection with the Term Loan, the Company shall
---------
furnish to the Agent a certificate in substantially the form of Exhibit
5.2.1.
2.3.2. Term Loan Account; Term Notes. The Term Loan shall be made
-----------------------------
at the Boston Office by crediting the amount of such loan to the general
account of the Company with the Agent. The Agent will establish on its
books a loan account for the Company (the "Term Loan Account") which the
-----------------
Agent shall administer as follows: (a) the Agent shall record and the Term
Loan Account shall evidence, the principal amount of the loan made by the
Lenders to the Company pursuant to Section 2.3.1 and (b) the Agent shall
reduce the Term Loan Account by the amount of all payments made on account
of the Indebtedness
37
evidenced by the Term Loan Account. The Agent shall keep a record of the
respective interests of the Lenders in the Term Loan Account as part of the
Register, which shall evidence the Term Loan. The Term Loan shall be deemed
owed to each Lender severally in accordance with such Lender's Term Loan
Percentage Interest therein, and all payments thereon shall be for the
account of each Lender in accordance with its Term Loan Percentage Interest
therein. Upon written request of any Lender, the Company's obligations to
pay such Lender's Term Loan Percentage Interest in the Term Loan shall be
further evidenced by a separate note of the Company in substantially the
form of Exhibit 2.3.2 (the "Term Notes"), payable to such Lender in
----------
accordance with such Lender's Term Loan Percentage Interest in the Term
Loan.
2.4. Letters of Credit.
-----------------
2.4.1. Issuance of Letters of Credit. Subject to all the terms and
-----------------------------
conditions of this Agreement and so long as no Default exists, from time to
time on and after the Restatement Date and prior to the Final Maturity
Date, the Letter of Credit Issuer will issue for the account of the Company
or, if the Company shall so direct, for the account of any Guarantor one or
more irrevocable documentary or standby letters of credit (the "Letters of
----------
Credit"); provided, that the Letter of Credit Exposure shall in no event
------
exceed $45,000,000 and the sum of the Letter of Credit Exposure plus the
----
Revolving Loan plus the Swingline Loan shall in no event exceed the Maximum
----
Amount of Revolving Credit; and, provided, further, that all letters of
credit issued pursuant to Section 2.4.1 of the Existing Credit Agreement
that are outstanding on the Restatement Date shall be continued and treated
in all respects from and after the Restatement Date as Letters of Credit
issued under this Section 2.4.1.
2.4.2. Requests for Letters of Credit. The Company may from time
------------------------------
to time request a Letter of Credit to be issued by providing to the Letter
of Credit Issuer (and the Agent if the Letter of Credit Issuer is not the
Agent) a notice which is actually received not less than two Banking Days
prior to the requested Closing Date for such Letter of Credit specifying
(a) the amount of the requested Letter of Credit, (b) the beneficiary
thereof, (c) the requested Closing Date and (d) the principal terms of the
text for such Letter of Credit. Each Letter of Credit will be issued by
forwarding it to the Company or to such other Person as directed in writing
by the Company, with a copy to the Company. In connection with the
issuance of any Letter of Credit, the Company shall furnish to the Letter
of Credit Issuer (and the Agent if the Letter of Credit Issuer is not the
Agent) a certificate in substantially the form of Exhibit 5.2.1 and any
customary application forms required by the Letter of Credit Issuer.
2.4.3. Form and Expiration of Letters of Credit. Each Letter of
----------------------------------------
Credit issued under this Section 2.4 and each draft accepted or paid under
such a Letter of Credit shall be issued, accepted or paid, as the case may
be, by the Letter of Credit Issuer at its principal office. No Letter of
Credit shall provide for the
38
payment of drafts drawn thereunder, and no draft shall be payable, at a
date which is later than the earlier of (a) the date twelve months after
the date of issuance or (b) the Final Maturity Date. Each Letter of Credit
and each draft accepted under a Letter of Credit shall be in such form as
is generally acceptable in the petroleum industry, shall be in such amount
as the Letter of Credit Issuer and the Company may agree upon at the time
such Letter of Credit is issued and shall include a requirement of not less
than three Banking Days after presentation of a draft before payment must
be made thereunder.
2.4.4. Lenders' Participation in Letters of Credit. Upon the
-------------------------------------------
issuance of any Letter of Credit, a participation therein, in an amount
equal to each Lender's Revolving Loan Percentage Interest, shall
automatically be deemed granted by the Letter of Credit Issuer to each
Lender on the date of such issuance and the Lenders shall automatically be
obligated, as set forth in Section 12.4, to reimburse the Letter of Credit
Issuer to the extent of their respective Revolving Loan Percentage
Interests for all obligations incurred by the Letter of Credit Issuer to
third parties in respect of such Letter of Credit not reimbursed by the
Company. The Letter of Credit Issuer will send to each Lender (and the
Agent if the Letter of Credit Issuer is not the Agent) a confirmation
regarding the participations in Letters of Credit outstanding during such
month.
2.4.5. Presentation. The Letter of Credit Issuer may accept or pay
------------
any draft presented to it, regardless of when drawn and whether or not
negotiated, if such draft, the other required documents and any transmittal
advice are presented to the Letter of Credit Issuer and dated on or before
the expiration date of the Letter of Credit under which such draft is
drawn. Except insofar as instructions actually received may be given by
the Company in writing expressly to the contrary with regard to, and prior
to, the Letter of Credit Issuer's issuance of any Letter of Credit for the
account of the Company and such contrary instructions are reflected in such
Letter of Credit, the Letter of Credit Issuer may honor as complying with
the terms of the Letter of Credit and with this Agreement any drafts or
other documents otherwise in order signed or issued by an administrator,
executor, conservator, trustee in bankruptcy, debtor in possession,
assignee for benefit of creditors, liquidator, receiver or other legal
representative of the party authorized under such Letter of Credit to draw
or issue such drafts or other documents. Within two Banking Days following
the presentation of a draft under any Letter of Credit, the Letter of
Credit Issuer shall give notice thereof to the Company, which notice shall
be accompanied by copies of the draft and all documents presented
therewith.
2.4.6. Payment of Drafts. At such time as a Letter of Credit
-----------------
Issuer makes any payment on a draft presented or accepted under a Letter of
Credit, the Company will on demand pay to such Letter of Credit Issuer in
immediately available funds the amount of such payment. Unless the Company
shall otherwise pay to the Letter of Credit Issuer the amount required by
the foregoing sentence, any such amount paid prior to the Final Maturity
Date shall be considered a loan
39
under Section 2.1.1 and part of the Revolving Loan. So long as no Default
shall exist or be created thereby, the addition of such amount to the
Revolving Loan pursuant to the preceding sentence shall constitute payment
for the purposes of this Section 2.4.6.
2.4.7. Uniform Customs and Practice . The Uniform Customs and
----------------------------
Practice for Documentary Credits (1993 Revision), International Chamber of
Commerce Publication No. 500, and any subsequent revisions thereof approved
by a Congress of the International Chamber of Commerce and adhered to by
the Letter of Credit Issuer (the "Uniform Customs and Practice"), shall be
----------------------------
binding on the Company and the Letter of Credit Issuer except to the extent
otherwise provided herein, in any Letter of Credit or in any other Credit
Document. Anything in the Uniform Customs and Practice to the contrary
notwithstanding:
(a) Neither the Company nor any beneficiary of any Letter of
Credit shall be deemed an agent of any Letter of Credit Issuer.
(b) With respect to each Letter of Credit, neither the Letter of
Credit Issuer nor its correspondents shall be responsible for or shall have
any duty to ascertain:
(i) the genuineness of any signature;
(ii) the validity, form, sufficiency, accuracy, genuineness
or legal effect of any endorsements;
(iii) delay in giving, or failure to give, notice of arrival,
notice of refusal of documents or of discrepancies in respect of which
any Letter of Credit Issuer refuses the documents or any other notice,
demand or protest;
(iv) the performance by any beneficiary under any Letter of
Credit of such beneficiary's obligations to the Company;
(v) inaccuracy in any notice received by the Letter of
Credit Issuer;
(vi) the validity, form, sufficiency, accuracy, genuineness
or legal effect of any instrument, draft, certificate or other
document required by such Letter of Credit to be presented before
payment of a draft, or the office held by or the authority of any
Person signing any of the same; or
(vii) failure of any instrument to bear any reference or
adequate reference to such Letter of Credit, or failure of any Person
to note the amount of any instrument on the reverse of such Letter of
Credit or to
40
surrender such Letter of Credit or to forward documents in the manner
required by such Letter of Credit.
(c) The occurrence of any of the events referred to in the Uniform
Customs and Practice or in the preceding clauses of this Section 2.4.7
shall not affect or prevent the vesting of any of the Letter of Credit
Issuer's rights or powers hereunder or the Company's obligation to make
reimbursement of amounts paid under any Letter of Credit or any draft
accepted thereunder.
(d) Upon receipt, the Company will promptly examine (i) each Letter
of Credit (and any amendments thereof) sent to it by the Letter of Credit
Issuer and (ii) all instruments and documents delivered to it from time to
time by the Letter of Credit Issuer. The Company will notify the Letter of
Credit Issuer of any claim of noncompliance by notice actually received
within 36 hours (excluding hours included in non-Banking Days) after
receipt of any of the foregoing documents, the Company being conclusively
deemed to have waived any such claim against such Letter of Credit Issuer
and its correspondents unless such notice is given.
(e) In the event of any conflict between the provisions of this
Agreement and the Uniform Customs and Practice, the provisions of this
Agreement shall govern.
2.4.8. Subrogation. Upon any payment by a Letter of Credit Issuer
-----------
under any Letter of Credit and until the reimbursement of such Letter of
Credit Issuer by the Company with respect to such payment as provided in
Section 2.4.6, the Letter of Credit Issuer shall be entitled to be
subrogated to, and to acquire and retain, the rights which the Person to
whom such payment is made may have against the Company, all for the benefit
of the Lenders. The Company will take such action as the Letter of Credit
Issuer may reasonably request, including requesting the beneficiary of any
Letter of Credit to execute such documents as the Letter of Credit Issuer
may reasonably request, to assure and confirm to the Letter of Credit
Issuer such subrogation and such rights, including the rights, if any, of
the beneficiary to whom such payment is made in accounts receivable,
inventory and other properties and assets of any Obligor.
2.4.9. Modification, Consent, etc. If the Company requests or consents
--------------------------
in writing to any modification or extension of any Letter of Credit, or
waives in writing any failure of any draft, certificate or other document
to comply with the terms of such Letter of Credit, and if the Letter of
Credit Issuer consents thereto, the Letter of Credit Issuer shall be
entitled to rely on such request, consent or waiver. This Agreement shall
be binding upon the Company with respect to such Letter of Credit as so
modified or extended, and with respect to any action taken or omitted by
such Letter of Credit Issuer pursuant to any such request, consent or
waiver.
2.5. Application of Proceeds.
-----------------------
2.5.1. Revolving Loan. Subject to Section 2.5.6, the Company will
--------------
apply the proceeds of the Revolving Loan to refinance the Company's
obligations under the Existing Credit Agreement, to finance Permitted
Contango Market Transactions, to fund acquisitions and capital
expenditures, and for working capital and other lawful corporate purposes
of the Company and its Subsidiaries.
2.5.2. Swingline Loan. Subject to Section 2.5.6, the Company will
--------------
apply the proceeds of the Swingline Loan for working capital and other
lawful corporate purposes of the Company and its Subsidiaries.
2.5.3. Term Loan. Subject to Section 2.5.6, the Company will apply
---------
the proceeds of the Term Loan to fund partially the acquisition of LDEC
under the Acquisition Agreement (the "Acquisition").
-----------
2.5.4. [Intentionally Omitted].
2.5.5. Letters of Credit. Letters of Credit shall be issued only
-----------------
for such lawful corporate purposes as the Company has requested in writing.
2.5.6. Specifically Prohibited Applications. The Company will not,
------------------------------------
directly or indirectly, apply any part of the proceeds of any extension of
credit made pursuant to the Credit Documents to purchase or to carry Margin
Stock or to any transaction prohibited by the Foreign Trade Regulations, by
other Legal Requirements applicable to the Lenders or by the Credit
Documents.
2.6. Nature of Obligations of Lenders to Make Extensions of Credit.
-------------------------------------------------------------
The Lenders' obligations to extend credit under this Agreement are several and
are not joint or joint and several. Notwithstanding the foregoing, the
obligation to make a Swingline Loan shall be an obligation solely of the
Swingline Lender. If on any Closing Date any Lender shall fail to perform its
obligations under this Agreement, the aggregate amount of Commitments to make
the extensions of credit under this Agreement shall be reduced by the amount of
unborrowed Commitment of the Lender so failing to perform and the Percentage
Interests, Revolving Loan Percentage Interests and Term Loan Percentage
Interests shall be appropriately adjusted. Lenders that have not failed to
perform their obligations to make the extensions of credit contemplated by
Section 2 may, if any such Lender so desires, assume, in such proportions as
such Lenders may agree, the obligations of any Lender who has so failed and the
Percentage Interests, Revolving Loan Percentage Interests and Term Loan
Percentage Interests shall be appropriately adjusted. The provisions of this
Section 2.6 shall not affect the rights of the Company against any Lender
failing to perform its obligations hereunder.
42
3. Interest; Eurodollar Pricing Options; Fees.
------------------------------------------
3.1. Interest. The Revolving Loan and the Term Loan shall accrue
--------
and bear interest at a rate per annum which shall at all times equal the
Applicable Rate. Prior to any stated or accelerated maturity of the Revolving
Loan and the Term Loan, the Company will, on each Payment Date, pay the accrued
and unpaid interest on the portion of the Loan which was not subject to a
Eurodollar Pricing Option. On the last day of each Eurodollar Interest Period
or on any earlier termination of any Eurodollar Pricing Option, the Company will
pay the accrued and unpaid interest on the portion of the Loan which was subject
to the Eurodollar Pricing Option which expired or terminated on such date. In
the case of any Eurodollar Interest Period longer than three months, the Company
will also pay the accrued and unpaid interest on the portion of the Revolving
Loan and the Term Loan, respectively, subject to the Eurodollar Pricing Option
having such Eurodollar Interest Period at three-month intervals, the first such
payment to be made on the last Banking Day of the three-month period which
begins on the first day of such Eurodollar Interest Period. On the stated or
any accelerated maturity of the Revolving Loan or the Term Loan, the Company
will pay all accrued and unpaid interest on the Revolving Loan or the Term Loan,
as the case may be, including any accrued and unpaid interest on any portion of
the Revolving Loan or the Term Loan, as the case may be, which is subject to a
Eurodollar Pricing Option. The Swingline Loan shall accrue and bear interest at
a rate per annum which shall at all times equal the Swingline Rate. Interest on
the Swingline Loan shall be calculated on a daily basis and on the basis of a
year of 360 days. Prior to any stated or accelerated maturity of the Swingline
Loan, the Company will on each Wednesday, beginning on the first Wednesday after
the Restatement Date, pay the accrued and unpaid interest, if any, on such
Indebtedness. On any stated or accelerated maturity of the Swingline Loan all
accrued and unpaid interest thereon shall be forthwith due and payable. All
payments of interest hereunder in respect of the Swingline Loan shall be made by
the Company to the Agent for the account of the Swingline Lender. In addition,
the Company will on demand pay interest on any overdue installments of principal
and, to the extent not prohibited by applicable law, on any overdue installments
of interest, fees and any other overdue amounts owed under any Credit Document
at a rate per annum equal to the sum of 2% plus the highest Applicable Rate then
----
in effect or at a rate per annum equal to the sum of 2% plus the Swingline Rate
----
then in effect in the case of overdue installments of principal and interest
with respect to a Swingline Loan (the "Overdue Rate"). All payments of interest
------------
hereunder shall be made to the Agent for the account of each Lender in
accordance with such Lender's Revolving Loan Percentage Interest or Term Loan
Percentage Interest, as the case may be.
3.2. Eurodollar Pricing Options.
--------------------------
3.2.1. Election of Eurodollar Pricing Options. Subject to all of
--------------------------------------
the terms and conditions hereof and so long as no Default exists, the
Company may from time to time, by irrevocable notice to the Agent actually
received not less than three Banking Days prior to the commencement of the
Eurodollar Interest Period selected in such notice, elect to have such
portion of the Loan (excluding the Swingline Loan) as the Company may
specify in such notice accrue and bear
43
interest during the Eurodollar Interest Period so selected at the
Applicable Rate computed on the basis of the Eurodollar Rate. No such
election shall become effective:
(a) if, prior to the commencement of any such Eurodollar Interest
Period, the Agent determines that (i) the electing or granting of the
Eurodollar Pricing Option in question would violate a Legal Requirement,
(ii) Eurodollar deposits in an amount comparable to the principal amount of
the Loan as to which such Eurodollar Pricing Option has been elected and
which have a term corresponding to the proposed Eurodollar Interest Period
are not readily available in the inter-bank Eurodollar market, or (iii) by
reason of circumstances affecting the inter-bank Eurodollar market,
adequate and reasonable methods do not exist for ascertaining the interest
rate applicable to such deposits for the proposed Eurodollar Interest
Period; or
(b) if any Lender shall have advised the Agent by telephone or
otherwise at or prior to noon (Boston time) on the second Banking Day prior
to the commencement of such proposed Eurodollar Interest Period (and shall
have subsequently confirmed in writing) that, after reasonable efforts to
determine the availability of such Eurodollar deposits, such Lender
reasonably anticipates that Eurodollar deposits in an amount equal to the
Revolving Loan Percentage Interest or Term Loan Percentage Interest, as the
case may be, of such Lender in the portion of the Loan as to which such
Eurodollar Pricing Option has been elected and which have a term
corresponding to the Eurodollar Interest Period in question will not be
offered in the Eurodollar market to such Lender.
3.2.2. Notice to Lenders and Company. The Agent will promptly
-----------------------------
inform each Lender (by telephone or otherwise) of each notice received by
it from the Company pursuant to Section 3.2.1 and of the Eurodollar
Interest Period specified in such notice. Upon determination by the Agent
of the Eurodollar Rate for such Eurodollar Interest Period or in the event
such election shall not become effective, the Agent will promptly notify
the Company and each Lender (by telephone or otherwise) of the Eurodollar
Rate so determined or why such election did not become effective, as the
case may be.
3.2.3. Selection of Eurodollar Interest Periods. Eurodollar
----------------------------------------
Interest Periods shall be selected so that:
(a) the minimum portion of the Loan subject to any Eurodollar
Pricing Option shall be $1,000,000 and an integral multiple of $500,000;
(b) no more than ten Eurodollar Pricing Options shall be
outstanding at any one time; and
44
(c) no Eurodollar Interest Period with respect to any part of the
Loan subject to a Eurodollar Pricing Option shall expire later than the
Final Maturity Date.
3.2.4. Additional Interest. If any portion of the Loan subject to a
-------------------
Eurodollar Pricing Option is repaid, or any Eurodollar Pricing Option is
terminated for any reason (including acceleration of maturity), on a date
which is prior to the last Banking Day of the Eurodollar Interest Period
applicable to such Eurodollar Pricing Option, the Company will pay to the
Agent for the account of each Lender in accordance with such Lender's
Revolving Loan Percentage Interest or Term Loan Percentage Interest, as the
case may be, in addition to any amounts of interest otherwise payable
hereunder, an amount equal to the present value (calculated in accordance
with this Section 3.2.4) of interest for the unexpired portion of such
Eurodollar Interest Period on the portion of the Loan so repaid, or as to
which a Eurodollar Pricing Option was so terminated, at a per annum rate
equal to the excess, if any, of (a) the rate applicable to such Eurodollar
Pricing Option minus (b) the lowest rate of interest obtainable by the
-----
Agent upon the purchase of debt securities customarily issued by the
Treasury of the United States of America which have a maturity date
approximating the last Banking Day of such Eurodollar Interest Period. The
present value of such additional interest shall be calculated by
discounting the amount of such interest for each day in the unexpired
portion of such Eurodollar Interest Period from such day to the date of
such repayment or termination at a per annum interest rate equal to the
interest rate determined pursuant to clause (b) of the preceding sentence,
and by adding all such amounts for all such days during such period. The
determination by the Agent of such amount of interest shall, in the absence
of demonstrable error, be conclusive. For purposes of this Section 3.2.4,
if any portion of the Loan which was to have been subject to a Eurodollar
Pricing Option is not outstanding on the first day of the Eurodollar
Interest Period applicable to such Eurodollar Pricing Option other than for
reasons described in Section 3.2.1, the Company shall be deemed to have
terminated such Eurodollar Pricing Option.
3.2.5. Violation of Legal Requirements. If any Legal Requirement
-------------------------------
shall prevent any Lender from funding or maintaining through the purchase
of deposits in the interbank Eurodollar market any portion of the Loan
subject to a Eurodollar Pricing Option or otherwise from giving effect to
such Lender's obligations as contemplated by Section 3.2, (a) the Agent may
by notice to the Company describing such Legal Requirement terminate all of
the affected Eurodollar Pricing Options, (b) the portion of the Loan
subject to such terminated Eurodollar Pricing Options shall immediately
bear interest thereafter at the Applicable Rate computed on the basis of
the Base Rate and (c) the Company shall make any payment required by
Section 3.2.4.
3.2.6. Funding Procedure. The Lenders may fund any portion of the
-----------------
Loan subject to a Eurodollar Pricing Option out of any funds available to
the Lenders. Regardless of the source of the funds actually used by any of
the
45
Lenders to fund any portion of the Loan subject to a Eurodollar Pricing
Option, however, all amounts payable hereunder, including the interest rate
applicable to any such portion of the Loan and the amounts payable under
Sections 3.2.4, 3.5, 3.6, 3.7 and 3.8, shall be computed as if each Lender
had actually funded such Lender's Revolving Loan Percentage Interest or
Term Loan Percentage Interest, as the case may be, in such portion of the
Loan through the purchase of deposits in such amount of the type by which
the Eurodollar Basic Rate was determined with a maturity the same as the
applicable Eurodollar Interest Period relating thereto and through the
transfer of such deposits from an office of the Lender having the same
location as the applicable Eurodollar Office to one of such Lender's
offices in the United States of America.
3.3. Facility Fees. In consideration of the Lenders' commitments to make
-------------
the extensions of credit provided for in Section 2, while such commitments are
outstanding, the Company will pay to the Agent for the account of the Lenders in
accordance with the Lenders' respective Revolving Loan Percentage Interests, on
each Payment Date and on the Final Maturity Date, an amount equal to interest
computed at a rate per annum equal to the Facility Fee Rate on the average daily
Maximum Amount of Revolving Credit during the quarter or portion thereof ending
on such Payment Date or, as the case may be, the Final Maturity Date; provided,
--------
however, that the first such payment shall be for the period beginning on the
-------
Restatement Date and ending on the first Payment Date.
3.4. Letter of Credit Fees. The Company will pay to the Agent for the
---------------------
account of each of the Lenders, in accordance with the Lenders' respective
Revolving Loan Percentage Interests, on each Payment Date and on the Final
Maturity Date, a Letter of Credit fee equal to interest at a rate per annum
equal to the Letter of Credit Fee Rate on the average daily Letter of Credit
Exposure during the quarter or portion thereof ending on such Payment Date or,
as the case may be, the Final Maturity Date; provided, that if any Letter of
Credit or any extension of a Letter of Credit would produce a fee hereunder that
is less than $250 during the term of such Letter of Credit or extension, the fee
owing to the Lenders hereunder with respect to such Letter of Credit or
extension shall be $250. The Company also will pay to the Letter of Credit
Issuer (i) on the date of issuance of each Letter of Credit an issuance fee of
$150 with respect to such Letter of Credit, (ii) on each Payment Date and on the
Final Maturity Date, an additional Letter of Credit fee equal to interest at the
rate of one-eighth of one percent (1/8%) per annum on the average daily Letter
of Credit Exposure during the quarter or portion thereof ending on such Payment
Date or, as the case may be, the Final Maturity Date and (iii) as invoiced,
other customary service charges and expenses for the services of the Letter of
Credit Issuer in connection with the Letters of Credit at the times and in the
amounts from time to time in effect in accordance with its general rate
structure, including fees and expenses relating to issuance, amendment,
negotiation, cancellation and similar operations.
3.5. Reserve Requirements, etc. If any Legal Requirement shall (a)
-------------------------
impose, modify, increase or deem applicable any insurance assessment, reserve,
special deposit or similar requirement against any Funding Liability or the
Letters of Credit, (b) impose, modify, increase or deem applicable any other
requirement or condition with respect to
46
any Funding Liability or the Letters of Credit, or (c) change the basis of
taxation of Funding Liabilities or payments in respect of any Letter of Credit
(other than changes in the rate of taxes measured by the overall net income of
such Lender) and the effect of any of the foregoing shall be to increase the
cost to any Lender of issuing, making, funding or maintaining its respective
Revolving Loan Percentage Interest or Term Loan Percentage Interest, as the case
may be, in any portion of the Loan subject to a Eurodollar Pricing Option or any
Letter of Credit, to reduce the amounts received or receivable by such Lender
under this Agreement or to require such Lender to make any payment or forego any
amounts otherwise payable to such Lender under this Agreement, then, within 15
days after the receipt by the Company of a certificate from such Lender setting
forth why it is claiming compensation under this Section 3.5 and computations
(in reasonable detail) of the amount thereof, the Company shall pay to the Agent
for the account of such Lender such additional amounts as are specified by such
Lender in such certificate as sufficient to compensate such Lender for such
increased cost or such reduction, together with interest at the Overdue Rate on
such amount from the 15th day after receipt of such certificate until payment in
full thereof; provided, however, that the foregoing provisions shall not apply
-------- -------
to any Tax or to any reserves which are included in computing the Eurodollar
Reserve Rate. The determination by such Lender of the amount of such costs
shall, in the absence of demonstrable error, be conclusive. The Company shall be
entitled to replace any such Lender in accordance with Section 13.3.
3.6. Taxes. All payments of the Credit Obligations shall be made without
-----
set-off or counterclaim and free and clear of any deductions, including
deductions for Taxes, unless the Company is required by law to make such
deductions. If (a) any Lender shall be subject to any Tax with respect to any
payment of the Credit Obligations or its obligations hereunder or (b) the
Company shall be required to withhold or deduct any Tax on any payment on the
Credit Obligations, within 15 days after the receipt by the Company of a
certificate from such Lender setting forth why it is claiming compensation under
this Section 3.6 and computations (in reasonable detail) of the amount thereof,
the Company shall pay to the Agent for such Lender's account such additional
amount as is necessary to enable such Lender to receive the amount of Tax so
imposed on the Lender's obligations hereunder or the full amount of all payments
which it would have received on the Credit Obligations (including amounts
required to be paid under Sections 3.5, 3.7, 3.8 and this Section 3.6) in the
absence of such Tax, as the case may be, together with interest at the Overdue
Rate on such amount from the 15th day after receipt of such certificate until
payment in full thereof. Whenever Taxes must be withheld by the Company with
respect to any payments of the Credit Obligations, the Company shall promptly
furnish to the Agent for the account of the applicable Lender official receipts
(to the extent that the relevant governmental authority delivers such receipts)
evidencing payment of any such Taxes so withheld. If the Company fails to pay
any such Taxes when due or fails to remit to the Agent for the account of the
applicable Lender the required receipts evidencing payment of any such Taxes so
withheld or deducted, the Company shall indemnify the affected Lender for any
incremental Taxes and interest or penalties that may become payable by such
Lender as a result of any such failure. The determination by such Lender of the
amount of such Tax and the basis therefor shall, in the absence of demonstrable
47
error, be conclusive. The Company shall be entitled to replace any such Lender
in accordance with Section 13.3.
3.7. Capital Adequacy. If any Lender shall determine that compliance by
----------------
such Lender with any Legal Requirement regarding capital adequacy of banks or
bank holding companies has or would have the effect of reducing the rate of
return on such Lender's capital as a consequence of such Lender's commitment to
make the extensions of credit contemplated hereby, or such Lender's maintenance
of the extensions of credit contemplated hereby, to a level below that which
such Lender could have achieved but for such compliance (taking into
consideration such Lender's policies with respect to capital adequacy
immediately before such compliance and assuming that such Lender's capital was
fully utilized prior to such compliance) by an amount deemed by such Lender to
be material, then, within 15 days after the receipt by the Company of a
certificate from such Lender setting forth why it is claiming compensation under
this Section 3.7 and computations (in reasonable detail) of the amount thereof,
the Company shall pay to the Agent for the account of such Lender such
additional amounts as shall be sufficient to compensate such Lender for such
reduced return, together with interest at the Overdue Rate on each such amount
from the 15th day after receipt of such certificate until payment in full
thereof. The determination by such Lender of the amount to be paid to it and the
basis for computation thereof shall, in the absence of demonstrable error, be
conclusive. In determining such amount, such Lender may use any reasonable
averaging, allocation and attribution methods. The Company shall be entitled to
replace any such Lender in accordance with Section 13.3.
3.8. Regulatory Changes. If any Lender shall determine that (a) any change
------------------
in any Legal Requirement (including any new Legal Requirement) after the date
hereof shall directly or indirectly (i) reduce the amount of any sum received or
receivable by such Lender with respect to the Loan or the Letters of Credit or
the return to be earned by such Lender on the Loan or the Letters of Credit,
(ii) impose a cost on such Lender or any Affiliate of such Lender that is
attributable to the making or maintaining of, or such Lender's commitment to
make, its portion of the Loan or the Letters of Credit, or (iii) require such
Lender or any Affiliate of such Lender to make any payment on, or calculated by
reference to, the gross amount of any amount received by such Lender under any
Credit Document, and (b) such reduction, increased cost or payment shall not be
fully compensated for by an adjustment in the Applicable Rate or the Letter of
Credit fees, then, within 15 days after the receipt by the Company of a
certificate from such Lender setting forth why it is claiming compensation under
this Section 3.8 and computations (in reasonable detail) of the amount thereof,
the Company shall pay to such Lender such additional amounts as such Lender
determines will, together with any adjustment in the Applicable Rate, fully
compensate for such reduction, increased cost or payment, together with interest
on such amount from the 15th day after receipt of such certificate until payment
in full thereof at the Overdue Rate. The determination by such Lender of the
amount to be paid to it and the basis for computation thereof hereunder shall,
in the absence of demonstrable error, be conclusive. In determining such amount,
such Lender may use any reasonable averaging and attribution methods. The
Company shall be entitled to replace any such Lender in accordance with Section
13.3.
48
3.9. Computations of Interest and Fees. For purposes of this Agreement,
---------------------------------
interest, facility fees and Letter of Credit fees (and any other amount
expressed as interest or such fees) shall be computed on the basis of a 360-day
year for actual days elapsed. If any payment required by this Agreement becomes
due on any day that is not a Banking Day, such payment shall, except as
otherwise provided in the Eurodollar Interest Period, be made on the next
succeeding Banking Day. If the due date for any payment of principal is extended
as a result of the immediately preceding sentence, interest shall be payable for
the time during which payment is extended at the Applicable Rate or, in the case
of principal of the Swingline Loan, at the Swingline Rate.
4. Payment.
-------
4.1. Payment at Maturity. On the Final Maturity Date, and in the case of
-------------------
the Term Loan, the Final Term Loan Maturity Date, or any accelerated maturity of
the Loan, the Company will pay to the Agent for the account of the Lenders an
amount equal to the Loan then due, together with all accrued and unpaid interest
thereon and all other Credit Obligations then outstanding.
4.2. Contingent Required Prepayments.
-------------------------------
4.2.1. Excess Credit Exposure. If at any time the Loan exceeds the
----------------------
Maximum Amount of Revolving Credit, the Company will within three Banking
Days pay the amount of such excess to the Agent for the account of the
Lenders. If at any time the Swingline Loan exceeds $20,000,000, the Company
will within three Banking Days pay the amount of such excess to the
Swingline Lender.
4.2.2. Letter of Credit Exposure. If at any time the Letter of Credit
-------------------------
Exposure exceeds the limits set forth in Section 2.4, the Company will
promptly pay the amount of such excess to the Agent for the account of the
Lenders to be applied as provided in Section 4.6.
4.2.3. Capital Markets Transaction. If the Company or any Subsidiary
---------------------------
should raise any capital by means of a debt or equity issuance, including
without limitation the issuance of any New Equity Securities (a "Capital
--------
Markets Transaction"), then so long as the Term Loan is outstanding the
-------------------
Company shall promptly pay 100% of the net proceeds of any such Capital
Markets Transaction to the Agent for the account of the Lenders to be
applied to the repayment of the Term Loan.
4.3. [Intentionally Omitted].
4.4. [Intentionally Omitted].
4.5. Voluntary Prepayments. In addition to the prepayments required by
---------------------
Section 4.2, the Company may from time to time prepay all or any portion of the
49
Revolving Loan or Term Loan (in a minimum amount of $1,000,000 and an integral
multiple of $100,000), without premium or penalty of any type (except as
provided in Section 3.2.4 with respect to the early termination of Eurodollar
Pricing Options). The Company shall give the Agent at least three Banking Days
prior notice of its intention to prepay, specifying the date of payment, the
total amount of the Loan to be paid on such date and the amount of interest to
be paid with such prepayment. At any time or from time to time upon telephone
notice to the Swingline Lender, given not later than 3:00 p.m. (Boston time) on
any Banking Day, the Company shall have the right to prepay, without premium or
penalty of any type, all or any part of the outstanding principal amount of its
Swingline Loan in such amounts as are not less than $100,000 and in integral
multiples of $50,000, unless such payment is equal to the entire outstanding
principal amount of the Swingline Loan.
4.6. Letters of Credit. If on the stated or any accelerated maturity of
-----------------
the Credit Obligations the Lenders shall be obligated in respect of a Letter of
Credit or a draft accepted under a Letter of Credit, the Company will either:
(a) prepay such obligation by depositing with the Agent an amount
of cash, or
(b) deliver to the Agent a standby letter of credit (designating
the Agent as beneficiary and issued by a bank and on terms reasonably
acceptable to the Agent),
in each case in an amount equal to the portion of the then Letter of Credit
Exposure issued for the account of the Company. Any such cash so deposited and
the cash proceeds of any draw under any standby letter of credit so furnished,
including any interest thereon, shall be returned by the Agent to the Company
only when, and to the extent that, the amount of such cash held by the Agent
exceeds the Letter of Credit Exposure at a time when no Default exists;
provided, however, that if an Event of Default occurs and the Credit Obligations
-------- -------
become or are declared immediately due and payable, the Agent may apply such
cash, including any interest thereon, to the payment of any of the Credit
Obligations as provided in Section 10.5.6.
4.7. Reborrowing; Application of Payments, etc.
------------------------------------------
4.7.1. Reborrowing. The amounts of the Revolving Loan prepaid
-----------
pursuant to Section 4.2.1 or 4.5 may be reborrowed from time to time prior
to the Final Maturity Date in accordance with Section 2.1, subject to the
limits set forth therein. The amounts of the Swingline Loan prepaid
pursuant to Section 4.2.1 or 4.5 may be reborrowed from time to time prior
to the Final Maturity Date in accordance with Section 2.2, subject to the
limits set forth therein. No amount of the Term Loan that is repaid may be
reborrowed hereunder.
4.7.2. Order of Application. Any prepayment of the Revolving Loan
--------------------
or the Term Loan shall be applied first to the portion thereof not then
subject to
50
Eurodollar Pricing Options, then the balance of any such prepayment shall
be applied to the portion thereof then subject to Eurodollar Pricing
Options, in the chronological order of the respective maturities thereof,
together with any payments required by Section 3.2.4.
4.7.3. Payment with Accrued Interest, etc. Upon all prepayments of
----------------------------------
the Term Loan, the Company shall pay to the Agent the principal amount to
be prepaid, together with unpaid interest in respect thereof accrued to the
date of prepayment. Notice of prepayment having been given in accordance
with Section 4.5, and whether or not notice is given of prepayments
pursuant to Section 4.2 the amount specified to be prepaid shall become due
and payable on the date specified for prepayment.
4.7.4. Payments for Lenders. All payments of principal hereunder
--------------------
shall be made to the Agent for the account of the Lenders in accordance
with the Lenders' respective Revolving Loan Percentage Interests or Term
Loan Percentage Interests, as the case may be.
5. Conditions to Extending Credit.
------------------------------
5.1. Conditions on Restatement Date. The obligations of the Lenders to
------------------------------
make any extension of credit pursuant to Section 2 shall be subject to the
satisfaction, on or before the Restatement Date, of the conditions set forth in
this Section 5.1 as well as the further conditions in Section 5.2. If the
conditions set forth in this Section 5.1 are not met on or prior to the
Restatement Date, the Lenders shall have no obligation to make any extensions of
credit hereunder.
5.1.1. Notes. The Company shall have duly executed and delivered
-----
to the Agent a Revolving Note and a Term Note for each Lender committing to
the Revolving Loan and the Term Loan, respectively, and a Swingline Note
for the Swingline Lender.
5.1.2. Perfection of Security. Each Obligor shall have duly
----------------------
authorized, executed, acknowledged, delivered, filed, registered and
recorded such security agreements, notices, financing statements and other
instruments as the Agent may have requested in order to perfect the Liens
purported or required pursuant to the Credit Documents to be created in the
Credit Security. All Liens securing amounts owing under the Existing
Credit Agreement shall remain in effect as part of the Credit Security.
5.1.3. Payment of Fees. The Company shall have paid to the Agent
---------------
for the account of BankBoston all fees required to be paid on or prior to
the Restatement Date pursuant to the separate agreement dated October 8,
1998 among the Company, BankBoston and the Syndication Agent (the
"BankBoston Fee Letter") and the fees and disbursements of the Agent's
----------------------
special counsel and
51
other costs and expenses of the Agent for which statements have been
rendered on or prior to the Restatement Date.
5.1.4. Legal Opinions. On the Restatement Date, the Lenders shall
--------------
have received from the following counsel their respective opinions with
respect to the transactions contemplated by the Credit Documents, which
opinions shall be in form and substance satisfactory to the Required
Lenders:
(a) ▇▇▇▇ ▇. ▇▇▇▇▇▇▇, general counsel of the Company and its
Subsidiaries.
(b) ▇▇▇▇▇▇▇▇ ▇. May, associate general counsel of certain
Subsidiaries of the Company.
(c) Ropes & ▇▇▇▇, special counsel for the Agent.
Each of the Company and its Subsidiaries authorizes and directs its
counsel to furnish the foregoing opinions.
5.1.5. Letter of Credit Agreements. The Company shall have executed
---------------------------
and delivered to BankBoston a Master Standby Letter of Credit Reimbursement
and Security Agreement and a Trade Key (R) Services Agreement, each in the
form previously supplied by BankBoston to the Company.
5.1.6. Prudential Consent. Prudential and each other holder of
------------------
Indebtedness issued under the Master Shelf Agreement shall have consented,
to the extent required under the Master Shelf Agreement and the
Intercreditor Agreement, to the modifications of the Existing Credit
Agreement effected hereby, the terms and conditions of such consent to be
satisfactory to the Required Lenders, and shall have acknowledged that the
Intercreditor Agreement remains in full force and effect; and the covenants
of the Company set forth in the Master Shelf Agreement shall have been
amended to reflect the covenant modifications of the Existing Credit
Agreement made herein.
5.1.7. No Material Adverse Change. There shall have been no Material
--------------------------
Adverse Change in the Company since April 30, 1998.
5.1.8. No Order, Injunction or Litigation. There has been no order,
----------------------------------
injunction or other pending litigation, which in the sole judgment of the
Agent, causes a reasonable possibility of a decision which could materially
adversely affect the ability of the Company or its Subsidiaries to perform
under the Credit Documents or affect the Agent's rights under the Credit
Documents or its ability to exercise such rights.
5.1.9. Adverse Market Change. Since October 8, 1998 no material
---------------------
adverse change shall have occurred in the syndication markets for credit
facilities
52
similar in nature to this Agreement and no material disruption of or
material adverse change in the financial, banking or capital markets that
would have an adverse effect on such syndication market shall have
occurred, in each case as determined by the Agent and the Syndication Agent
in their sole discretion.
5.1.10. Acquisition. Other than as consented to by the Agent in
-----------
writing:
(a) The provisions of the Acquisition Agreement shall not have
been amended, modified, waived or terminated.
(b) All of the representations and warranties of the Seller set
forth in the Acquisition Agreement shall be complete and correct in all
material respects on and as of the Restatement Date with the same force and
effect as though made on and as of such date.
(c) All of the other conditions to the obligations of the Company
set forth in the Acquisition Agreement shall have been satisfied.
(d) Any material consent, authorization, order or approval of any
Person required in connection with the transactions contemplated by the
Acquisition Agreement shall have been obtained and shall be in full force
and effect.
(e) All of the items required to be delivered under the
Acquisition Agreement shall have been so delivered.
(f) Contemporaneously with the making by the Lenders of the
extension of credit hereunder on the Restatement Date, the Company shall
have furnished to the Lenders a certificate, signed by a Financial Officer,
to the effect that the closing has occurred under the Acquisition
Agreement.
(g) Contemporaneously with the making by the Lenders of the
extension of credit hereunder on the Restatement Date, LDEC shall have
executed and delivered in favor of the Agent for the benefit of the Lenders
a joinder agreement satisfying the requirements of Section 9.9.
(h) The Agent shall have had the opportunity to complete, in its
sole discretion, a satisfactory review of LDEC, including but not limited
to environmental review, financial projections to be provided by the
Company and due diligence reports provided to the Company by its advisors.
5.1.11. Year 2000 Plan. The Company and its Subsidiaries will have
--------------
informed the Lenders, in reasonable detail, of the actions the Company and
its Subsidiaries have taken and will be taking to become Year 2000
Compliant (the "Year 2000 Plan").
--------------
53
5.1.12. Pro forma Compliance.
--------------------
(a) After giving effect to the Acquisition and the incurrence of
the Credit Obligations contemplated to be incurred on the Restatement Date,
the Company and its Subsidiaries, taken as a whole:
(i) will be solvent;
(ii) will have assets having a fair saleable value in excess
of the amount required to pay their probable liability on their
existing debts as such debts become absolute and mature;
(iii) will have access to adequate capital for the conduct of
their business; and
(iv) will have the ability to pay their debts from time to
time incurred as such debts mature.
(b) The Company shall have furnished to the Lenders a certificate,
signed by a Financial Officer, to such effect, together with calculations
pursuant to Sections 6.9 and 7.2.1(d) with respect to the Computation
Covenants, in each case using the financial statements of the Company and
its Subsidiaries as of April 30, 1998 and of LDEC as of May 31, 1998 and
giving pro forma effect to the Acquisition and the incurrence of the Credit
Obligations.
5.1.13. Subordinated Debentures. The holders of the Subordinated
-----------------------
Debentures shall have consented to the execution and delivery of this
Agreement and shall have agreed that the Credit Obligations constitute
"Superior Indebtedness" with respect to the Subordinated Debentures.
5.2. Conditions to Each Extension of Credit. The obligations of the
--------------------------------------
Lenders to make any extension of credit pursuant to Section 2 (which, for the
avoidance of any doubt, shall not include any pricing election under Section
3.2.2 with respect to any portion of the Loan that is already outstanding) shall
be subject to the satisfaction, on or before the Closing Date for such extension
of credit, of the following conditions:
5.2.1. Officer's Certificate. The representations and warranties
---------------------
contained in Sections 7 and 10.3 shall be true and correct on and as of
such Closing Date with the same force and effect as though made on and as
of such date (except as to any representation or warranty which refers to a
specific earlier date); provided, that the information contained in
Exhibits 7.1, 7.3 and 7.15 shall be correct as most recently supplemented,
including any supplements thereto noted in the certificate provided under
this Section 5.2.1; no Default shall exist on such Closing Date prior to or
immediately after giving effect to the requested extension of credit; no
Material Adverse Change shall have occurred since April 30, 1998 and be
continuing on such Closing Date; and the Company shall have furnished to
54
the Agent in connection with the requested extension of credit a
certificate to these effects, in substantially the form of Exhibit 5.2.1,
signed by a Financial Officer.
5.2.2. Proper Proceedings. This Agreement, each other Credit
------------------
Document and the transactions contemplated hereby and thereby shall have
been authorized by all necessary corporate or other proceedings. All
necessary consents, approvals and authorizations of any governmental or
administrative agency or any other Person of any of the transactions
contemplated hereby or by any other Credit Document shall have been
obtained and shall be in full force and effect.
5.2.3. Legality, etc. The making of the requested extension of
-------------
credit shall not (a) subject any Lender to any penalty or special tax
(other than a Tax for which the Company is required to reimburse the
Lenders under Section 3.6), (b) be prohibited by any Legal Requirement or
(c) violate any credit restraint program of the executive branch of the
government of the United States of America, the Board of Governors of the
Federal Reserve System or any other governmental or administrative agency
so long as any Lender reasonably believes that compliance therewith is in
the best interests of such Lender.
5.2.4. General. All legal and corporate proceedings in connection
-------
with the transactions contemplated by this Agreement shall be satisfactory
in form and substance to the Agent and the Agent shall have received copies
of all documents, including certified copies of the Charter and By-Laws of
the Company and the other Obligors, records of corporate proceedings,
certificates as to signatures and incumbency of officers and opinions of
counsel, which the Agent may have reasonably requested in connection
therewith, such documents where appropriate to be certified by proper
corporate or governmental authorities.
6. General Covenants. Each of the Company and the Guarantors covenants that,
-----------------
until all of the Credit Obligations shall have been paid in full and until the
Lenders' commitments to extend credit under this Agreement and any other Credit
Document shall have been irrevocably terminated, the Company and its
Subsidiaries will comply with the following provisions:
6.1. Taxes and Other Charges; Accounts Payable.
-----------------------------------------
6.1.1. Taxes and Other Charges. Each of the Company and its Subsidiaries
-----------------------
shall duly pay and discharge, or cause to be paid and discharged, before the
same becomes in arrears, all material taxes, assessments and other governmental
charges imposed upon such Person and its properties, sales or activities, or
upon the income or profits therefrom, as well as all claims for labor, materials
or supplies which if unpaid might by law become a Lien upon any of its property;
provided, however, that any such tax, assessment, charge or claim need not be
-------- -------
paid if the validity or amount thereof shall at the time be contested in good
faith by appropriate proceedings and if such Person shall have set aside on its
books adequate reserves with respect thereto to the extent required by GAAP;
55
and provided, further, that each of the Company and its Subsidiaries shall pay
-------- -------
or bond, or cause to be paid or bonded, all such taxes, assessments, charges or
other governmental claims immediately upon the commencement of proceedings to
foreclose any Lien which may have attached as security therefor (except to the
extent such proceedings have been dismissed or stayed).
6.1.2. Accounts Payable. Each of the Company and its Subsidiaries
----------------
shall promptly pay when due, or in conformity with customary trade terms,
all other material Indebtedness incident to the operations of such Person
not referred to in Section 6.1.1; provided, however, that any such
-------- -------
Indebtedness need not be paid if the validity or amount thereof shall at
the time be contested in good faith and if such Person shall have set aside
on its books adequate reserves with respect thereto to the extent required
by GAAP.
6.2. Conduct of Business, etc.
------------------------
6.2.1. Types of Business. The Company and its Subsidiaries shall
-----------------
engage principally in the business of (a) providing transportation,
terminaling and storage services for petroleum products and the
distribution, purchase and/or sale of petroleum products, chemicals and
other bulk liquids, (b) natural gas gathering, processing, transmission and
marketing and (c) other activities related thereto. The Company and its
Subsidiaries may engage in businesses other than those described in the
preceding sentence, provided that the gross revenues of such other
businesses in any fiscal year of the Company shall not exceed 10% of the
Consolidated gross revenues of the Company and its Subsidiaries.
6.2.2. Maintenance of Properties. Each of the Company and its
-------------------------
Subsidiaries:
(a) shall keep its properties in such repair, working order and
condition, and shall from time to time make such repairs, replacements,
additions and improvements thereto as are necessary for the efficient
operation of its businesses and shall comply at all times in all material
respects with all material franchises, licenses and leases to which it is
party so as to prevent any loss or forfeiture thereof or thereunder, except
where failure to comply with such provisions has not resulted, and does not
create a material risk of resulting, in the aggregate in any Material
Adverse Change; and
(b) shall do all things necessary to preserve, renew and keep in full
force and effect and in good standing its legal existence and authority
necessary to continue its business; provided, however, that this Section
-------- -------
6.2.2(b) shall not prevent the merger, consolidation or liquidation of
Subsidiaries permitted by Section 6.11.
6.2.3. Statutory Compliance. Each of the Company and its
--------------------
Subsidiaries shall comply in all material respects with all valid and
applicable statutes, laws,
56
ordinances, zoning and building codes and other rules and regulations of
the United States of America, of the states and territories thereof and
their counties, municipalities and other subdivisions and of any foreign
country or other jurisdictions applicable to such Person, except where
failure so to comply with such provisions has not resulted, and does not
create a material risk of resulting, in the aggregate in any Material
Adverse Change.
6.2.4. Compliance with Material Agreements. Each of the Company and
-----------------------------------
its Subsidiaries shall comply in all material respects with the Material
Agreements (to the extent not in violation of the other provisions of this
Agreement or any other Credit Document). Without the prior written consent
of the Required Lenders, no Material Agreement shall be amended, modified,
waived or terminated in any manner that would have in any material respect
an adverse effect on the interests of the Lenders; provided, without
limitation of the foregoing, that any modification of the Master Shelf
Agreement that would cause the covenants of the Company or the defaults
thereunder to be more restrictive than the covenants or defaults,
respectively, contained in this Agreement or that would constitute or cause
a Default shall require the prior written consent of the Required Lenders.
6.2.5. Trading Policy. The Company and its Subsidiaries will
--------------
maintain and follow a policy of managing petroleum inventory risk with the
objective of minimizing potentially adverse impacts on earnings arising
from volatility in refined petroleum product prices. The Lenders
acknowledge that the policy described in the Risk and Product Management
Policy Statement dated May 1998 of TransMontaigne Product Services Inc., an
Arkansas corporation, as modified by the letter dated October 30, 1998 from
the Company to the Agent, a full copy of which is attached to this Credit
Agreement as Exhibit 6.2.5, represents such a policy.
6.2.6. Subordinated Debentures. The Company shall do all things
-----------------------
necessary to assure that the Loan and all of the Credit Obligations be and
remain "Superior Indebtedness" within the meaning of Section 10 of the
Subordinated Debentures Agreement.
6.2.7. Inventory Accounting. The Company and its Subsidiaries shall
--------------------
account for their inventory on the basis of the "LIFO" method of
accounting; provided, that they may change to any other method of inventory
accounting then permitted by GAAP, so long as the provisions of Section 6.5
are amended in such manner as the Required Lenders shall consider necessary
in their reasonable judgment to maintain the same standards of
creditworthiness.
6.2.8. Inactive Subsidiaries. The Company and its Subsidiaries shall
---------------------
not make any Investment in or transfer any assets to each of K123
Corporation, a Colorado corporation, and Republic Natural Gas Company, a
Kansas corporation, each of which is a Wholly Owned Subsidiary of the
Company.
57
6.3. Insurance.
---------
6.3.1 Property Insurance. Each of the Company and its Subsidiaries
------------------
shall keep its assets which are of an insurable character insured by
financially sound and reputable insurers against theft and fraud and
against loss or damage by fire, explosion and hazards insured against by
extended coverage to the extent, in amounts and with deductibles at least
as favorable as those generally maintained by businesses of similar size
engaged in similar activities.
6.3.2. Liability Insurance. Each of the Company and its Subsidiaries
-------------------
shall maintain with financially sound and reputable insurers insurance
against liability for hazards, risks and liability to persons and property
to the extent, in amounts and with deductibles at least as favorable as
those generally maintained by businesses of similar size engaged in similar
activities; provided, however, that it may effect workers' compensation
-------- -------
insurance or similar coverage with respect to operations in any particular
state or other jurisdiction through an insurance fund operated by such
state or jurisdiction or by meeting the self-insurance requirements of such
state or jurisdiction.
6.4. Financial Statements and Reports. Each of the Company and its
--------------------------------
Subsidiaries shall maintain a system of accounting in accordance with generally
accepted accounting practices. The fiscal year of the Company and its
Subsidiaries shall end on June 30 in each year and the fiscal quarters of the
Company and its Subsidiaries shall end on September 30, December 31, March 31
and June 30 in each year.
6.4.1. Annual Reports. The Company shall furnish to the Lenders
--------------
as soon as available, and in any event within 95 days after the end of each
fiscal year, the Consolidated balance sheet of the Company and its
Subsidiaries as at the end of such fiscal year, the Consolidated statements
of income, changes in shareholders' equity and cash flows of the Company
and its Subsidiaries for such fiscal year (all in reasonable detail) and
together with Consolidating schedules as of such date and for such period
and, in the case of Consolidated financial statements, comparative figures
for the immediately preceding fiscal year, all accompanied by:
(a) Unqualified reports of KPMG Peat Marwick LLP (or, if they
cease to be auditors of the Company and its Subsidiaries, other independent
certified public accountants of recognized national standing reasonably
satisfactory to the Required Lenders), containing no material uncertainty,
to the effect that they have audited the foregoing Consolidated financial
statements in accordance with generally accepted auditing standards and
that such Consolidated financial statements present fairly, in all material
respects, the financial position of the Company and its Subsidiaries
covered thereby at the dates thereof and the results of their operations
for the periods covered thereby in conformity with GAAP.
58
(b) The statement of such accountants that they have caused this
Agreement to be reviewed and that in the course of their audit of the
Company and its Subsidiaries no facts have come to their attention that
cause them to believe that any Default exists and in particular that they
have no knowledge of any Default under Sections 6.5 through 6.20 or, if
such is not the case, specifying such Default and the nature thereof. This
statement is furnished by such accountants with the understanding that the
examination of such accountants cannot be relied upon to give such
accountants knowledge of any such Default except as it relates to
accounting or auditing matters within the scope of their audit.
(c) A certificate of the Company signed by a Financial Officer to
the effect that such officer has caused this Agreement to be reviewed and
has no knowledge of any Default, or if such officer has such knowledge,
specifying such Default and the nature thereof, and what action the Company
has taken, is taking or proposes to take with respect thereto.
(d) Computations by the Company in the form set forth in Exhibit
6.4.1 hereto demonstrating, as of the end of such fiscal year, compliance
with the Computation Covenants, certified by a Financial Officer.
(e) Calculations, as at the end of such fiscal year, of (i) the
Accumulated Benefit Obligations for each Plan covered by Title IV of ERISA
(other than Multiemployer Plans) and (ii) the fair market value of the
assets of such Plan allocable to such benefits.
(f) Supplements to Exhibits 7.1, 7.3 and 7.15 showing any changes
in the information set forth in such Exhibits not previously furnished to
the Lenders in writing, as well as any changes in the Charter, Bylaws or
incumbency of officers of the Company or its Subsidiaries from those
previously certified to the Agent.
6.4.2. Quarterly Reports. The Company shall furnish to the Lenders
-----------------
as soon as available and, in any event, within 50 days after the end of
each of the first three fiscal quarters of the Company, the internally
prepared Consolidated balance sheet of the Company and its Subsidiaries as
of the end of such fiscal quarter, the Consolidated statements of income,
changes in shareholders' equity and cash flows of the Company and its
Subsidiaries for such fiscal quarter and for the portion of the fiscal year
then ended (all in reasonable detail) and together with Consolidating
schedules as of such date and for such period (if such Consolidating
schedules are requested by the Agent or the Required Lenders) and, in the
case of Consolidated statements, comparative figures for the same period in
the preceding fiscal year, all accompanied by:
(a) A certificate of the Company signed by a Financial Officer to
the effect that such financial statements have been prepared in accordance
with
59
GAAP and present fairly, in all material respects, the financial position
of the Company and its Subsidiaries covered thereby at the dates thereof
and the results of their operations for the periods covered thereby,
subject only to normal year-end audit adjustments and the addition of
footnotes.
(b) A certificate of the Company signed by a Financial Officer to
the effect that such officer has caused this Agreement to be reviewed and
has no knowledge of any Default, or if such officer has such knowledge,
specifying such Default and the nature thereof and what action the Company
has taken, is taking or proposes to take with respect thereto.
(c) Computations by the Company in the form set forth in Exhibit
6.4.1 hereto demonstrating, as of the end of such quarter, compliance with
the Computation Covenants, certified by a Financial Officer.
(d) Supplements to Exhibits 7.1, 7.3 and 7.15 showing any changes
in the information set forth in such Exhibits not previously furnished to
the Lenders in writing, as well as any changes in the Charter, Bylaws or
incumbency of officers of the Company and its Subsidiaries from those
previously certified to the Agent.
(e) Calculations by the Company showing the Contango Market
Obligations and Permitted Contango Market Transactions of the Company and
its Subsidiaries as of the last day of such quarter, such calculations to
be materially consistent with the Risk and Product Management Policy
Statement referred to in Section 6.2.5 as currently in effect.
6.4.3. Year 2000 Compliant. The Company shall furnish to the
-------------------
Lenders as soon as available and in any event within 50 days after the end
of each fiscal quarter of the Company, a certificate signed by a
responsible officer stating that the Company and its Subsidiaries have made
no determination that any computer application or system which is material
to the operations of the Company or its Subsidiaries will not be Year 2000
Compliant on a timely basis, except to the extent that such failure could
not be expected to have a Material Adverse Effect.
6.4.4. Other Reports. The Company shall promptly furnish to the
-------------
Lenders:
(a) As soon as prepared and in any event within 90 days after the
beginning of each fiscal year, an annual budget and operating projections
for such fiscal year of the Company and its Subsidiaries, prepared in a
manner consistent with the manner in which the financial projections
described in Section 7.2.1 were prepared and shall include a capital
expenditure plan for such fiscal year.
(b) Any material updates of such budget and projections.
60
(c) Any management letters furnished to the Company or any of its
Subsidiaries by the Company's auditors.
(d) All budgets, projections, statements of operations and other
reports furnished generally to the shareholders of the Company.
(e) Such registration statements, proxy statements and reports,
including Forms ▇-▇, ▇-▇, ▇-▇, 10-K, 10-Q and 8-K, as may be filed by the
Company or any of its Subsidiaries with the Securities and Exchange
Commission.
(f) Any 90-day or 30-day letter from the federal Internal Revenue
Service asserting material tax deficiencies against the Company or any of
its Subsidiaries; and any similar notice from a state or other taxing
authority asserting material tax deficiencies against the Company or any of
its Subsidiaries that are not fully resolved without the assessment of a
material tax deficiency (and any tax paid) within 90 days following the
date of such notice.
(g) Notice of the issuance of any Funded Debt permitted by Section
6.6.11 or 6.6.12, together with a calculation of the proceeds thereof (net
of costs of issuance) and copies of all evidence of Indebtedness and other
documentation governing such Funded Debt.
(h) Any revised versions of the Risk and Product Management Policy
Statement referred to in Section 6.2.5.
6.4.5. Notice of Litigation. The Company shall promptly furnish to
--------------------
the Lenders notice of any litigation or any administrative or arbitration
proceeding (a) to which the Company or any of its Subsidiaries may
hereafter become a party if the damages claimed in such proceeding exceed
$2,000,000 or (b) which creates a material risk of resulting, after giving
effect to any applicable insurance, in the payment by the Company and its
Subsidiaries of more than $1,000,000 or (c) which results, or creates a
material risk of resulting, in a Material Adverse Change.
6.4.6. Notice of Defaults. Promptly upon acquiring knowledge
------------------
thereof, the Company shall notify the Lenders of the existence of any
Default, specifying the nature thereof and what action the Company or any
Subsidiary has taken, is taking or proposes to take with respect thereto.
6.4.7. ERISA Reports. The Company shall furnish to the Lenders as
-------------
soon as available the following items with respect to any Plan:
(a) any request for a waiver of the funding standards or an
extension of the amortization period,
61
(b) any reportable event (as defined in section 4043 of ERISA),
unless the notice requirement with respect thereto has been waived by
regulation,
(c) any notice received by any ERISA Group Person that the PBGC has
instituted or intends to institute proceedings to terminate any Plan, or
that any Multiemployer Plan is insolvent or in reorganization,
(d) notice of the possibility of the termination of any Plan by its
administrator pursuant to section 4041 of ERISA, and
(e) notice of the intention of any ERISA Group Person to withdraw,
in whole or in part, from any Multiemployer Plan.
6.4.8. Notice of Year 2000 Problem. The Company will promptly notify
---------------------------
the Agent in writing within 15 days of determining that any computer
application or system which is material to the operations of the Company or
any of its Subsidiaries or any of its material vendors or suppliers will
not be Year 2000 Compliant on a timely basis, except to the extent that
such failure could not be expected to have a Material Adverse Effect.
6.4.9. Other Information; Audit. From time to time at
------------------------
reasonable intervals upon request of the Agent or the Required Lenders,
each of the Company and its Subsidiaries shall furnish to the Lenders such
other information regarding the business, assets, financial condition,
income or prospects of the Company and its Subsidiaries as such officer may
reasonably request, including copies of all tax returns, licenses,
agreements, leases and instruments to which any of the Company or its
Subsidiaries is party. The authorized officers and representatives of the
Agent shall have the right during normal business hours upon reasonable
notice and at reasonable intervals to examine the books and records of the
Company and its Subsidiaries, to make copies and notes therefrom for the
purpose of ascertaining compliance with or obtaining enforcement of this
Agreement or any other Credit Document. The Company and its Subsidiaries
shall permit the Agent to examine its Year 2000 Plan and/or to discuss the
Company's Year 2000 Plan with appropriate officers of the Company all at
such reasonable times and intervals as the Agent may request. The Agent,
upon reasonable advance notice, may at the expense of the Company undertake
to have the Company and its Subsidiaries reviewed by the Agent's commercial
financial examiners and fixed asset appraisers; provided, that so long as
--------
no Event of Default shall have occurred and be continuing, the Agent shall
not request such reviews more than twice in any fiscal year of the Company.
6.5. Certain Financial Tests.
-----------------------
6.5.1. Fixed Charges Coverage.
----------------------
62
(a) For each fiscal quarter of the Company ending during each period
specified below, commencing with the fiscal quarter ended September 30,
1998, the Consolidated Income from Operations of the Company and its
Subsidiaries for the period of four consecutive fiscal quarters then ended
shall equal or exceed the percentage specified below next to such date of
the Consolidated interest expense of the Company and its Subsidiaries for
such period, determined in accordance with GAAP:
Date Percentage
---- ----------
On or before
December 31, 1999 200%
After December 31, 1999 and on or
before December 31, 2000 225%
After December 31, 2000 250%;
(b) Notwithstanding the foregoing, in the event that after the
Restatement Date and prior to January 1, 2000 the Company shall issue New
Equity Securities yielding net proceeds of $100,000,000 or more, then for
each fiscal period from and after such date of issuance through December
31, 1999 the required percentage under each of the preceding subsections of
this Section 6.5.1 shall be 225% instead of 200%.
(c) For the purposes of this Section 6.5.1 the Consolidated Income
from Operations of the Company and its Subsidiaries for any period prior to
the Restatement Date shall be deemed to be the Consolidated Income from
Operations of the Company and its Subsidiaries for such period plus the
Consolidated Income from Operations of LDEC for such period, combined in
accordance with GAAP.
(d) For the purposes of this Section 6.5.1 the Consolidated interest
expenses of the Company and its Subsidiaries for each period listed below
shall be the amount set forth next to such period:
Period Amount
------ ------
Twelve months ended $32,550,000
September 30, 1998
Twelve months ended $26,580,000 plus Consolidated
December 31, 1998 interest expense for the
portion of the period
commencing November
63
1, 1998
Twelve months ended $19,260,000 plus Consolidated
March 31, 1999 interest expense for the
portion of the period
commencing November 1, 1998
Twelve months ended $10,310,000 plus Consolidated
June 30, 1999 interest expense for the
portion of the period
commencing November 1, 1998
Twelve months ended $2,980,000 plus Consolidated
September 30, 1999 interest expense for the
portion of the period
commencing November 1, 1998
(e) For the purposes of this Section 6.5.1 interest expense shall
include any amounts incurred by the Company or any Subsidiary in respect of
Permitted Subordinated Trust Indebtedness or Permitted Preferred Trust
Securities to the extent, but only to the extent, that such amounts are
paid in cash or in the form of Indebtedness of the Company or a Subsidiary.
6.5.2. Adjusted Leverage Ratio.
-----------------------
(a) During the period commencing on the Restatement Date and ending
on and including December 31, 1999 the Adjusted Leverage Ratio of the
Company and its Subsidiaries at no time shall equal or exceed 70%;
provided, however, that in the event that after the Restatement Date and
prior to January 1, 2000 the Company shall issue New Equity Securities
yielding aggregate net proceeds of $100,000,000 or more, then from and
after the date of such issuance to and including December 31, 1999 the
adjusted Leverage Ratio of the Company and its Subsidiaries at no time
shall equal or exceed 65%.
(b) During each period specified below the Adjusted Leverage
Ratio of the Company and its Subsidiaries at no time shall equal or
exceed the percentage set forth below next to such period:
64
Period Percentage
------ ----------
From and including January 1, 2000 65%
to and including June 29, 2000
From and including June 30, 2000 60%
to and including December 30, 2000
From and including December 31, 2000 55%.
(c) Notwithstanding the provisions of paragraph (b) of this Section
6.5.2, in the event that the Term Loan shall be repaid in full prior to
March 31, 2000, then during each period specified below the Adjusted
Leverage Ratio of the Company and its Subsidiaries at no time shall equal
or exceed the percentage set forth below next to such period:
Period Percentage
------ ----------
From and including the later of
(x) January 1, 2000 or (y) the date
the Term Loan is repaid in full to
and including December 30, 2000 65%
From and including December 31, 2000 60%
to and including December 30, 2001
From and including December 31, 2001 55%.
6.5.3. Consolidated Tangible Net Worth. Consolidated Tangible Net
-------------------------------
Worth shall not at any time be less than $140,000,000; provided, however,
-------- -------
that on the last day of each fiscal quarter of the Company commencing with
the fiscal quarter ended September 30, 1998, the then effective dollar
amount in this Section 6.5.3 shall be increased by the sum of (a) 100% of
the first $75,000,000 in net proceeds of equity securities issued after the
Restatement Date by the Company and its Subsidiaries, calculated on a
Consolidated basis in accordance with GAAP, plus (b) 50% of any proceeds
----
realized by the Company and its Subsidiaries, calculated on a Consolidated
basis in accordance with GAAP, from the issuance of equity securities after
the Restatement Date to the extent that the aggregate net proceeds of such
issuances exceed $75,000,000, plus (c) 50% of Consolidated Net Income (if
----
positive) for the fiscal quarter then ended.
6.6. Indebtedness. Neither the Company nor any of its Subsidiaries shall
------------
create, incur, assume or otherwise become or remain liable with respect to any
Indebtedness except the following:
65
6.6.1. Indebtedness in respect of the Credit Obligations.
6.6.2. Guarantees permitted by Section 6.7.
6.6.3. Current liabilities, other than Financing Debt, incurred in
the ordinary course of business.
6.6.4. To the extent that payment thereof shall not at the time be
required by Section 6.1, Indebtedness in respect of taxes, assessments,
governmental charges and claims for labor, materials and supplies.
6.6.5. Indebtedness secured by Liens of carriers, warehouses,
mechanics and landlords permitted by Sections 6.8.5 and 6.8.6.
6.6.6. Indebtedness in respect of judgments or awards (a) which have
been in force for less than the applicable appeal period or (b) in respect
of which the Company or any Subsidiary shall at the time in good faith be
prosecuting an appeal or proceedings for review and, in the case of each of
clauses (a) and (b), the Company or such Subsidiary shall have taken
appropriate reserves therefor in accordance with GAAP and execution of such
judgment or award shall not be levied.
6.6.7. To the extent permitted by Section 6.8.9, Indebtedness in
respect of Capitalized Lease Obligations or secured by purchase money
security interests; provided, however, that (a) the aggregate principal
-------- -------
amount of all Indebtedness permitted by this Section 6.6.7 which consists
of Indebtedness in respect of Capital Lease Obligations and other
Indebtedness incurred for the acquisition of equipment shall not exceed 2%
of Adjusted Consolidated Net Tangible Assets at any one time outstanding
and (b) that the aggregate principal amount of all Indebtedness permitted
by this Section 6.6.7 which consists of Indebtedness issued to sellers of
any business or part thereof or operating assets in consideration for the
acquisition thereof by the Company or a Subsidiary shall not exceed 4% of
Adjusted Consolidated Net Tangible Assets at any one time outstanding.
6.6.8. Indebtedness in respect of deferred taxes arising in the
ordinary course of business.
6.6.9. Indebtedness in respect of inter-company loans and advances
among the Company and its Subsidiaries which are not prohibited by Section
6.9.
6.6.10. Indebtedness of the Company in respect of its 12.75%
Guaranteed Senior Subordinated Debentures due December 15, 2000 (the
"Subordinated Debentures").
-----------------------
66
6.6.11. Unsecured Funded Debt of the Company which is incurred or
issued for the purpose of financing acquisitions permitted by Section 6.9.5
or 6.9.7 and/or by the last paragraph of Section 6.9 and which is
subordinated to the Credit Obligations on terms satisfactory to the
Required Lenders.
6.6.12. The 7.85% Senior Secured Notes, Series A, Due April 10, 2003
of the Company issued pursuant to the Master Shelf Agreement dated as of
April 17, 1997 (as in effect on the Restatement Date and as from time to
time amended subject to the provisions of Section 6.2.4 hereof, the "Master
------
Shelf Agreement") between the Company and The Prudential Insurance Company
---------------
of America and affiliates thereof from time to time party thereto
(collectively, "Prudential") in aggregate principal amount not exceeding
----------
$50,000,000, the 7.22% Senior Secured Notes, Series B, Due October 17, 2004
of the Company issued pursuant to the Master Shelf Agreement in aggregate
principal amount not exceeding $25,000,000, other "Obligations", as defined
in the Master Shelf Agreement, of the Company and the Guarantors under the
Master Shelf Agreement (excluding any "Series" of "Notes" other than the
"Series A Notes", each as defined in the Master Shelf Agreement) and any
Indebtedness issued by the Company solely for the purpose of refunding the
aforesaid notes due April 10, 2003 the terms of which Indebtedness are
acceptable to the Required Lenders.
6.6.13. Unfunded pension liabilities and obligations with respect to
Plans so long as the Company is in compliance with Section 6.17.
6.6.14. Indebtedness outstanding on the date hereof and described in
Exhibit 7.3.
6.6.15. Funded Debt of the Company issued under and subject to the
terms of the Master Shelf Agreement, provided, that the aggregate principal
amount of such additional Funded Debt so issued shall not exceed
$25,000,000 and that the average life of such additional Funded Debt shall
be equal to or greater than six years from the date of issuance; and
provided, further, that after giving effect to the issuance of such Funded
Debt and the application of the proceeds thereof on the issuance date no
Default shall exist and the Company shall have delivered to the Agent a
certificate of a Financial Officer of the Company in reasonable detail
demonstrating compliance with Section 6.5 after giving effect to such
issuance and application.
6.6.16. Unsecured Funded Debt of the Company; provided, that after
giving effect to the issuance of such Unsecured Funded Debt and the
application of any of the proceeds thereof on the issuance date no Default
shall exist, and the Company shall have delivered to the Agent a
certificate of a Financial Officer of the Company in reasonable detail
demonstrating compliance with these conditions after giving effect to such
issuance and application; and provided, further, either (a) that the terms
and conditions of such unsecured Funded Debt, including without limitation,
financial covenants, defaults, amortization and rate of interest
67
shall have been consented to by the Required Lenders or (b) that the sum of
(i) the aggregate outstanding principal amount of Indebtedness permitted by
Section 6.6.15 plus (ii) the aggregate outstanding principal amount of
Indebtedness permitted under this clause (b) and not consented to as
provided in the preceding clause (a) at no time shall exceed $35,000,000.
6.6.17. Unsecured Funded Debt of the Company issued in a Capital
Markets Transaction which is subordinated to the Credit Obligations on
terms satisfactory to the Required Lenders.
6.6.18. Indebtedness of the Company (other than Financing Debt) in
addition to the foregoing; provided, however, that the aggregate amount of
-------- -------
all such Indebtedness at any one time outstanding shall not exceed
$2,000,000.
6.7. Guarantees; Letters of Credit. Neither the Company nor any of its
-----------------------------
Subsidiaries shall become or remain liable with respect to any Guarantee,
including reimbursement obligations under letters of credit or other financial
guarantees by third parties, except the following:
6.7.1. Letters of Credit and Guarantees of the Credit Obligations.
6.7.2. Guarantees by the Company or its Subsidiaries of
Indebtedness incurred by any of its Subsidiaries and permitted by Section
6.6.
6.7.3. Unsecured Guarantees by Wholly Owned Subsidiaries of the
Credit Obligations or Indebtedness of the Company permitted by Sections
6.6.10 and 6.6.11, so long as such Wholly Owned Subsidiaries are Guarantors
and such Guarantees are subordinated to such Guarantors' Guarantees of the
Credit Obligations to the same extent and in the same manner as the
Indebtedness of the Company permitted by Sections 6.6.10 and 6.6.11.
6.7.4. Guarantees and reimbursement obligations with respect to
letters of credit issued in support of Lion Oil Company, an Arkansas
corporation, but only so long as the Investment represented thereby is
permitted under Section 6.9.6 or 6.9.7 and, if permitted by Section 6.9.7,
is counted toward the limit provided therein.
6.7.5. The unsecured Guarantee by TransMontaigne Product Services
Midwest Inc. (formerly known as Continental Ozark, Inc.), an Arkansas
corporation, of the Subordinated Debentures pursuant to the Senior
Subordinated Debenture Guarantee dated March 28, 1991 (the "Subordinated
------------
Debentures Guarantee") executed by such corporation.
--------------------
6.7.6. Guarantees of the Funded Debt permitted by Sections 6.6.12
and 6.6.15.
68
6.8. Liens. Neither the Company nor any of its Subsidiaries shall create,
-----
incur or enter into, or suffer to be created or incurred or to exist, any Lien,
except the following:
6.8.1. Liens on the Credit Security that secure the Credit
Obligations.
6.8.2. Liens to secure taxes, assessments and other governmental
charges, to the extent that payment thereof shall not at the time be
required by Section 6.1.
6.8.3. Deposits or pledges made (a) in connection with, or to
secure payment of, workers' compensation, unemployment insurance, old age
pensions or other social security, (b) in connection with casualty
insurance maintained in accordance with Section 6.3, (c) to secure the
performance of bids, tenders, contracts (other than contracts relating to
Financing Debt) or leases, (d) to secure statutory obligations or surety or
appeal bonds, (e) to secure indemnity, performance or other similar bonds
in the ordinary course of business or (f) in connection with contested
amounts to the extent that payment thereof shall not at that time be
required by Section 6.1.
6.8.4. Liens in respect of judgments or awards, to the extent that
such judgments or awards are permitted by Section 6.6.6.
6.8.5. Liens of carriers, warehouses, mechanics and similar Liens,
in each case (a) in existence less than 90 days from the date of creation
thereof or (b) being contested in good faith by the Company or any
Subsidiary in appropriate proceedings (so long as the Company or such
Subsidiary shall have set aside on its books adequate reserves with respect
thereto to the extent required by GAAP).
6.8.6. Encumbrances in the nature of (a) zoning restrictions, (b)
easements, (c) restrictions of record on the use of real property, (d)
landlords' and lessors' Liens on rented premises and (e) restrictions on
transfers or assignment of leases, which in each case do not materially
detract from the value of the encumbered property or materially impair the
use thereof in the business of the Company or any Subsidiary.
6.8.7. Restrictions under federal and state securities laws on the
transfer of securities.
6.8.8. Restrictions under Foreign Trade Regulations on the
transfer or licensing of certain assets of the Company and its
Subsidiaries.
6.8.9. Liens constituting (a) purchase money security interests
(including mortgages, conditional sales, Capitalized Leases and any other
title retention or deferred purchase devices) in real property, interests
in leases or tangible personal property (other than inventory) existing or
created on the date on
69
which such property is acquired, and (b) the renewal, extension or
refunding of any security interest referred to in the foregoing clause (a)
in an amount not to exceed the amount thereof remaining unpaid immediately
prior to such renewal, extension or refunding; provided, however, that (i)
-------- -------
each such security interest shall attach solely to the particular item of
property so acquired, and the principal amount of Indebtedness (including
Indebtedness in respect of Capitalized Lease Obligations) secured thereby
shall not exceed the cost (including all such Indebtedness secured thereby,
whether or not assumed) of such item of property; and (ii) the aggregate
principal amount of all Indebtedness secured by Liens permitted by this
Section 6.8.9 shall not exceed the amount permitted by Section 6.6.7.
6.8.10. Liens on the Credit Security securing the Funded Debt
permitted by Sections 6.6.12 and 6.6.15, but only so long as such Liens are
on parity with or subordinate to the Lien of Section 10 hereof.
6.9. Investments and Acquisition. Neither the Company nor any of its
----------------------------
Subsidiaries shall have outstanding, acquire, commit itself to acquire or hold
any Investment (including any Investment consisting of the acquisition of any
business) except for the following:
6.9.1. Investments of the Company and its Subsidiaries in Wholly
Owned Subsidiaries as long as such Wholly Owned Subsidiaries are or become
Guarantors; provided, that Investments consisting of all or part of a
business or operating assets shall be permitted under this Section 6.9.1 to
the extent that such business or assets shall be acquired as assets of the
Company or of a Wholly Owned Subsidiary which is or becomes a Guarantor.
6.9.2. Intercompany loans and advances from any Wholly Owned
Subsidiary to the Company or other Wholly Owned Subsidiaries but in each
case only to the extent reasonably necessary for Consolidated tax planning
and working capital management.
6.9.3. Investments in Cash Equivalents.
6.9.4. Guarantees permitted by Section 6.7.
6.9.5. Investments made after the Restatement Date in Subsidiaries
listed in Exhibit 7.1 hereto as supplemented from time to time other than
Wholly Owned Subsidiaries, provided that the aggregate outstanding amount
of loans, advances and other Investments in such Subsidiaries, measured in
each case as of the date of the making of such Investment, shall not at any
time exceed 15% of Adjusted Consolidated Net Tangible Assets.
6.9.6. Investments outstanding on the Restatement Date and identified
in Exhibit 7.3.
70
6.9.7. Other Investments made after the date hereof that are not
permitted by any of the foregoing subsections of this Section 6.9, provided
that the aggregate outstanding amount of loans, advances and other
Investments of the Company and its Subsidiaries permitted under this
Section 6.9.7, measured in each case as of the date of the making of such
Investment, shall not at any time exceed 10% of Consolidated Tangible Net
Worth; provided, however, that no Investment may be made in a Subsidiary
-------- -------
unless such Subsidiary is listed in Exhibit 7.1 hereto as supplemented from
time to time.
6.9.8. Investments in West Shore Pipe Line Company, a Delaware
corporation, in addition to any such Investments permitted under the
preceding provisions of this Section 6.9; provided, that no Investment
under this Section 6.9.8 shall be permitted unless and until the Term Loan
shall have been repaid in full; and provided, further, that the aggregate
cumulative amount of the Investments made under this Section 6.9.8 shall
not exceed the remainder of (a) the sum of (i) $20,000,000 plus (ii) 50% of
the cumulative Consolidated Net Income of the Company and its Subsidiaries
commencing July 1, 1998 minus (b) the aggregate cumulative amount of
Distributions theretofore paid by the Company permitted by Section 6.10.2.
In addition, the Company covenants that the Company and its Subsidiaries
shall not acquire any operating business (whether through an asset acquisition
or an acquisition of stock or other equity) unless, after giving effect to such
acquisition and the financing thereof, the Company and its Subsidiaries will not
suffer any Default under any Computation Covenant or any other provision of this
Agreement; and provided, that, if the consideration (including without
limitation any assumption of Indebtedness, any deferred consideration and any
consideration paid for any related non-competition agreement) given shall exceed
$20,000,000 for any single acquisition (or, from and after the date that the
Term Loan shall have been repaid in full, $40,000,000 for any single
acquisition), then prior to consummating any such acquisition the Company shall
provide to the Lenders a certificate of a Financial Officer demonstrating that,
after giving effect to such acquisition and the financing thereof, the Company
and its Subsidiaries will not suffer any Default under any Computation Covenant
or any other provision of this Agreement.
6.10. Distributions. Neither the Company nor any of its Subsidiaries shall
-------------
make any Distribution except for the following:
6.10.1. Subsidiaries of the Company may make Distributions to the
Company or any Wholly Owned Subsidiary of the Company.
6.10.2. So long as immediately before and after giving effect
thereto no Default exists, the Company may make Distributions to its
stockholders; provided, that the cumulative amount distributed shall not
exceed the remainder of (a) the sum of (i) $20,000,000 plus (ii) 50% of the
cumulative Consolidated
71
Net Income of the Company and its Subsidiaries commencing July 1, 1998
minus (b) the aggregate cumulative amount of the Investments made by the
Company and its Subsidiaries under Section 6.9.8. Notwithstanding the
foregoing, no such Distributions may be made while any portion of the Term
Loan remains outstanding.
6.10.3. So long as immediately before and after giving effect
thereto no Default exists, the Company may make scheduled payments of
interest and principal on the Subordinated Debentures and other Funded Debt
of the Company permitted under Section 6.6.11.
6.11. Merger, Consolidation and Dispositions of Assets. Neither the
------------------------------------------------
Company nor any of its Subsidiaries shall merge or enter into a consolidation or
sell, lease, sell and lease back, sublease or otherwise dispose of any of its
assets, except the following:
6.11.1. The Company and any of its Subsidiaries may sell or
otherwise dispose of (a) inventory sold to customers in the ordinary course
of business, (b) tangible assets to be replaced in the ordinary course of
business within six months by other tangible assets of equal or greater
value and (c) tangible assets that are no longer used or useful in the
business of the Company or such Subsidiary, the fair market value (or book
value if greater) of which shall not exceed 4% of Adjusted Consolidated Net
Tangible Assets of the Company and its Subsidiaries as of the last day of
the next preceding fiscal year.
6.11.2. Any Wholly Owned Subsidiary of the Company may merge or be
liquidated into the Company or any other Wholly Owned Subsidiary of the
Company so long as after giving effect to any such merger to which the
Company is a party the Company shall be the surviving or resulting Person.
6.11.3. The Company and its Subsidiaries may enter into leases
(other than Capitalized Leases) as lessor of real and tangible personal
property and rights associated therewith in the ordinary course of
business.
6.11.4. Any inactive Subsidiary other than a Guarantor may be
liquidated.
6.12. Lease Obligations. Neither the Company nor any of its Subsidiaries
-----------------
will enter into any arrangement, directly or indirectly, whereby the Company or
such Subsidiary shall sell or transfer any property owned by it in order then or
thereafter to lease such property or to lease other property which the Company
or such Subsidiary intends to use for substantially the same purpose as the
property being sold or transferred. Neither the Company nor any of its
Subsidiaries shall be or become obligated as lessee under any lease except:
6.12.1. Capitalized Leases permitted by Sections 6.6.7 and 6.8.9.
72
6.12.2. Leases other than Capitalized Leases; provided, however,
-------- -------
that the aggregate fixed rental obligations for any fiscal year (excluding
payments required to be made by the lessee in respect of taxes and
insurance whether or not denominated as rent) shall not exceed in any
fiscal year 3% of Adjusted Consolidated Net Tangible Assets as of the last
day of the next preceding fiscal year.
6.13. Issuance of Stock by Subsidiaries; Subsidiary Distributions.
-----------------------------------------------------------
6.13.1. Issuance of Stock by Subsidiaries. No Subsidiary shall
---------------------------------
issue or sell any shares of its capital stock or other evidence of
beneficial ownership to any Person other than the Company or any Wholly
Owned Subsidiary of the Company, which shares shall have been pledged to
the Agent as part of the Credit Security.
6.13.2. No Restrictions on Subsidiary Distributions. Except for
-------------------------------------------
this Agreement and the Credit Documents, neither the Company nor any
Subsidiary shall enter into or be bound by any agreement (including
covenants requiring the maintenance of specified amounts of net worth or
working capital) restricting the right of any Subsidiary to make
Distributions or extensions of credit to the Company (directly or
indirectly through another Subsidiary).
6.14. Interest Rate Protection. On or before December 31, 1999, unless the
------------------------
Term Loan shall been paid in full, the Company shall obtain one or more Interest
Rate Protection Agreements, each in form and substance reasonably satisfactory
to the Agent, covering the entire anticipated outstanding principal amount of
the Revolving Loan.
6.15. Derivative Contracts. Neither the Company nor any of its
--------------------
Subsidiaries shall enter into any Interest Rate Protection Agreement, foreign
currency exchange contract or other financial or commodity derivative contracts
except to provide hedge protection for an underlying economic transaction in the
ordinary course of business.
6.16. Negative Pledge Clauses. Neither the Company nor any of its
-----------------------
Subsidiaries shall enter into any agreement, instrument, deed or lease which
prohibits or limits the ability of the Company or any of its Subsidiaries to
create, incur, assume or suffer to exist any Lien upon any of their respective
properties, assets or revenues, whether now owned or hereafter acquired, except
the following:
6.16.1. This Agreement and the other Credit Documents.
6.16.2. Covenants in documents creating Liens permitted by Section
6.8 prohibiting further Liens on the assets encumbered thereby.
6.16.3. The Master Shelf Agreement.
73
6.17. ERISA, etc. Each of the Company and its Subsidiaries shall comply,
----------
and shall cause all ERISA Group Persons to comply, in all material respects,
with the provisions of ERISA and the Code applicable to each Plan. Each of the
Company and its Subsidiaries shall meet, and shall cause all ERISA Group Persons
to meet, all minimum funding requirements applicable to them with respect to any
Plan pursuant to section 302 of ERISA or section 412 of the Code, without giving
effect to any waivers of such requirements or extensions of the related
amortization periods which may be granted. At no time shall the Accumulated
Benefit Obligations under any Plan that is not a Multiemployer Plan exceed the
fair market value of the assets of such Plan allocable to such benefits by more
than $1,000,000. The Company and its Subsidiaries shall not withdraw, and shall
cause all other ERISA Group Persons not to withdraw, in whole or in part, from
any Multiemployer Plan so as to give rise to withdrawal liability exceeding
$1,000,000 in the aggregate. At no time shall the actuarial present value of
unfunded liabilities for post-employment health care benefits, whether or not
provided under a Plan, calculated in a manner consistent with Statement No. 106
of the Financial Accounting Standards Board, exceed $1,000,000.
6.18. Transactions with Affiliates. Neither the Company nor any of its
----------------------------
Subsidiaries shall effect any transaction with any of their respective
Affiliates (except for the Company and its Subsidiaries) on a basis less
favorable to the Company and its Subsidiaries than would be the case if such
transaction had been effected with a non-Affiliate.
6.19. Open Positions. The Company and its Subsidiaries may maintain Open
--------------
Positions relating to product inventory requirements that do not exceed the
amount permitted by the Risk and Product Management Policy Statement then in
effect, so long as that policy is materially consistent with the requirements of
the first sentence of Section 6.2.5.
6.20. Permitted Contango Market Transactions. The Company and its
--------------------------------------
Subsidiaries may maintain Permitted Contango Market Transactions that do not
exceed the amount permitted by the Risk and Product Management Policy Statement
then in effect, so long as that policy is materially consistent with the
requirements of Section 6.2.5.
6.21. Environmental Laws.
------------------
6.21.1. Compliance with Law and Permits. Each of the Company and
-------------------------------
its Subsidiaries shall use and operate all of its facilities and properties
in material compliance with all Environmental Laws, keep all necessary
permits, approvals, certificates, licenses and other authorizations
relating to environmental matters in effect and remain in material
compliance therewith, and handle all Hazardous Materials in material
compliance with all applicable Environmental Laws, except where any failure
to so act could not, individually or in the aggregate, have a Material
Adverse Effect.
74
6.21.2. Notice of Claims, etc. Each of the Company and its
----------------------
Subsidiaries shall immediately notify the Agent, and provide copies upon
receipt, of all written claims, complaints, notices or inquiries from
governmental authorities relating to the condition of its facilities and
properties or compliance with Environmental Laws which could have a
Material Adverse Effect, and shall use best efforts to promptly cure and
have dismissed with prejudice to the satisfaction of the Agent any actions
and proceedings relating to compliance with Environmental Laws.
7. Representations and Warranties. In order to induce the Lenders to extend
------------------------------
credit to the Company hereunder, each of the Company and such of its
Subsidiaries as are party hereto from time to time jointly and severally
represents and warrants that, except as disclosed in the Disclosure Schedule
attached hereto as Exhibit 7:
7.1. Organization and Business.
-------------------------
7.1.1. The Company. The Company is a duly organized and validly
-----------
existing corporation, in good standing under the laws of Delaware, with all
power and authority, corporate or otherwise, necessary to (a) enter into
and perform this Agreement and each other Credit Document to which it is
party, (b) grant the Agent for the benefit of the Lenders the security
interests in the Credit Security owned by it to secure the Credit
Obligations and (c) own its properties and carry on the business now
conducted or proposed to be conducted by it. Certified copies of the
Charter and By-laws of the Company have been previously delivered to the
Agent and are correct and complete. Exhibit 7.1, as from time to time
hereafter supplemented in accordance with Sections 6.4.1 and 6.4.2, sets
forth, as of the later of the date hereof or as of the end of the most
recent fiscal quarter for which financial statements are required to be
furnished in accordance with such Sections, (i) the jurisdiction of
incorporation of the Company, (ii) the address of the Company's principal
executive office and chief place of business, (iii) each name, including
any trade name, under which the Company conducts its business and (iv) the
jurisdictions in which the Company keeps tangible personal property.
7.1.2. Subsidiaries. Each Subsidiary of the Company is duly
------------
organized, validly existing and in good standing under the laws of the
jurisdiction in which it is organized, with all power and authority,
corporate or otherwise, necessary to (a) enter into and perform this
Agreement and each other Credit Document to which it is party, (b)
guarantee the Credit Obligations, (c) grant the Lenders the security
interest in the Credit Security owned by such Subsidiary to secure the
Credit Obligations and (d) own its properties and carry on the business now
conducted or proposed to be conducted by it. Certified copies of the
Charter and By-laws of each Subsidiary of the Company have been previously
delivered to the Agent and are correct and complete. Exhibit 7.1, as from
time to time hereafter supplemented in accordance with Sections 6.4.1 and
6.4.2, sets forth, as of the later of the date hereof or as of the end of
the most recent fiscal quarter for which financial statements are required
to be furnished in accordance with such Sections, (i) the name and
jurisdiction of organization of each Subsidiary of the Company,
75
(ii) the address of the chief executive office and principal place of
business of each such Subsidiary, (iii) each name under which each such
Subsidiary conducts its business, (iv) each jurisdiction in which each such
Subsidiary keeps tangible personal property, and (v) the number of
authorized and issued shares and ownership of each such Subsidiary;
provided, however, that there may be omitted from Exhibit 7.1 one or more
-------- -------
Subsidiaries which have no business operations and no assets or
liabilities.
7.1.3. Qualification. Each of the Company and its Subsidiaries is
-------------
duly and legally qualified to do business as a foreign corporation or other
entity and is in good standing in each state or jurisdiction in which such
qualification is required and is duly authorized, qualified and licensed
under all laws, regulations, ordinances or orders of public authorities, or
otherwise, to carry on its business in the places and in the manner in
which it is conducted, except for failures to be so qualified, authorized
or licensed which would not in the aggregate result, or create a material
risk of resulting, in any Material Adverse Change.
7.1.4. Capitalization. No options, warrants, conversion rights,
--------------
preemptive rights or other statutory or contractual rights to purchase
shares of capital stock or other securities of any Subsidiary now exist,
nor has any Subsidiary authorized any such right, nor is any Subsidiary
obligated in any other manner to issue shares of its capital stock or other
securities.
7.2. Financial Statements and Other Information; Material Agreements.
---------------------------------------------------------------
7.2.1. Financial Statements and Other Information. The Company has
------------------------------------------
previously furnished to the Lenders copies of the following:
(a) The audited Consolidated and unaudited Consolidating balance
sheets of the Company and its Subsidiaries as at April 30, 1995, 1996, 1997
and 1998 and the audited Consolidated statements of income, changes in
shareholders' equity and cash flows of the Company and its Subsidiaries for
the fiscal years of the Company then ended.
(b) The unaudited Consolidated balance sheet of the Company and its
Subsidiaries as at June 30, 1998 and the unaudited Consolidated statements
of income, changes in shareholders' equity and cash flows of the Company
and its Subsidiaries for the portion of the fiscal year then ended.
(c) The three-year financial and operational projections and
current capital expenditures plan of the Company and its Subsidiaries dated
September 28, 1998.
(d) Calculations demonstrating pro forma compliance with the
Computation Covenants as of the end of the most recent month or quarter, as
applicable, preceding the date hereof.
76
(e) The audited Consolidated balance sheets of LDEC and its
Subsidiaries as at May 31, 1996, 1997 and 1998 and the audited Consolidated
statements of income, changes in shareholders' equity and cash flows of
LDEC and its Subsidiaries for the fiscal years of LDEC then ended.
The audited Consolidated financial statements (including the notes
thereto) referred to in clause (a) above were prepared in accordance with
GAAP and fairly present the financial position of the Company and its
Subsidiaries on a Consolidated basis at the respective dates thereof and
the results of their operations for the periods covered thereby. The
unaudited Consolidating financial statements referred to in clause (a)
above and the unaudited Consolidated financial statements referred to in
clause (b) above were prepared in accordance with GAAP and fairly present
the financial position of the Company and its Subsidiaries at the
respective dates thereof and the results of their operations for the
periods covered thereby, subject to normal year-end audit adjustment and
the addition of footnotes in the case of interim financial statements.
Neither the Company nor any of its Subsidiaries has any known contingent
liability material to the Company and its Subsidiaries on a Consolidated
basis which is not reflected in the balance sheets referred to in clause
(a) or (b) above (or delivered pursuant to Section 6.4.1 or 6.4.2) or in
the notes thereto.
In the Company's judgment, the financial and operational projections
referred to in clause (c) above constitute a reasonable basis as of the
Restatement Date for the assessment of the future performance of the
Company and its Subsidiaries during the periods indicated therein, it being
understood that any projected financial information represents an estimate,
based on various assumptions, of future results of operations, which
assumptions may prove to have been incorrect and which results may not in
fact occur.
7.2.2. Material Agreements. The Company has previously furnished to
-------------------
the Lenders a correct and complete copy of the Securities Purchase
Agreement dated March 28, 1991 (the "Subordinated Debentures Agreement")
---------------------------------
between the Company's predecessor, Continental Ozark Corporation, and
▇▇▇▇▇▇, Read & Co., Inc., as nominee, and correct and complete copies,
including all exhibits, schedules and amendments thereto, of the
agreements, each as in effect on the date hereof, listed in Exhibit 7.2.2
(together with the Subordinated Debentures, the Subordinated Debentures
Agreement, the Subordinated Debentures Guarantee, the Acquisition Agreement
and the Master Shelf Agreement, the "Material Agreements").
-------------------
7.3. Agreements Relating to Financing Debt, Investments, etc. Exhibit
-------------------------------------------------------
7.3, as from time to time hereafter supplemented in accordance with Sections
6.4.1 and 6.4.2, sets forth (a) the amounts (as of the dates indicated in
Exhibit 7.3, as so supplemented) of all Financing Debt of the Company and its
Subsidiaries and all agreements which relate to such Financing Debt, (b) all
Liens and Guarantees with respect to such Financing Debt,
77
(c) all agreements which directly or indirectly require the Company or any
Subsidiary to make any Investment and (d) all Investments permitted under
Section 6.9.6. The Company has furnished the Lenders with correct and complete
copies of any agreements described in clauses (a), (b), (c) and (d) above
requested by the Required Lenders.
7.4. Changes in Condition. Since April 30, 1998 no Material Adverse Change
--------------------
has occurred and between April 30, 1998 and the date hereof, neither the Company
nor any Subsidiary of the Company has entered into any material transaction
outside the ordinary course of business except for the transactions contemplated
by this Agreement and the Material Agreements.
7.5. Title to Assets. The Company and its Subsidiaries have defensible
---------------
title to or the right to use all material assets necessary for or used in the
operations of their business as now conducted by them and reflected in the most
recent balance sheet referred to in Section 7.2.1 (or the balance sheet most
recently furnished to the Lenders pursuant to Sections 6.4.1 or 6.4.2), and to
all assets acquired subsequent to the date of such balance sheet, subject to no
Liens except for Liens permitted by Section 6.8 and except for assets disposed
of as permitted by Section 6.11.
7.6. Operations in Conformity with Law, etc. To the best knowledge of the
--------------------------------------
Company and the Guarantors, the operations of the Company and its Subsidiaries
as now conducted or proposed to be conducted are not in violation of, nor is the
Company or its Subsidiaries in default under, any Legal Requirement presently in
effect, except for such violations and defaults as do not and will not, in the
aggregate, result, or create a material risk of resulting, in any Material
Adverse Change. The Company has received no notice of any such violation or
default and has no knowledge of any basis on which the operations of the Company
or its Subsidiaries, as now conducted and as currently proposed to be conducted
after the date hereof, would be held so as to violate or to give rise to any
such violation or default.
7.7. Litigation. No litigation, at law or in equity, or any proceeding
----------
before any court, board or other governmental or administrative agency or any
arbitrator is pending or, to the knowledge of the Company or any Guarantor,
threatened which may involve any material risk of any final judgment, order or
liability which, after giving effect to any applicable insurance, has resulted,
or creates a material risk of resulting, in any Material Adverse Change or which
seeks to enjoin the consummation, or which questions the validity, of any of the
transactions contemplated by this Agreement or any other Credit Document. No
judgment, decree or order of any court, board or other governmental or
administrative agency or any arbitrator has been issued against or binds the
Company or any of its Subsidiaries which has resulted, or creates a material
risk of resulting, in any Material Adverse Change.
7.8. Authorization and Enforceability. Each of the Company and each other
--------------------------------
Obligor has taken all corporate action required to execute, deliver and perform
this Agreement and each other Credit Document to which it is party. No consent
of stockholders of the Company is necessary in order to authorize the execution,
delivery or
78
performance of this Agreement or any other Credit Document to which the Company
is party. Each of this Agreement and each other Credit Document constitutes the
legal, valid and binding obligation of each Obligor party thereto and is
enforceable against such Obligor in accordance with its terms.
7.9. No Legal Obstacle to Agreements. Neither the execution and delivery
-------------------------------
of this Agreement or any other Credit Document, nor the making of any borrowings
hereunder, nor the guaranteeing of the Credit Obligations, nor the securing of
the Credit Obligations with the Credit Security, nor the consummation of any
transaction referred to in or contemplated by this Agreement or any other Credit
Document, nor the fulfillment of the terms hereof or thereof or of any other
agreement, instrument, deed or lease contemplated by this Agreement or any other
Credit Document, has constituted or resulted in or will constitute or result in:
(a) any breach or termination of the provisions of any material
agreement, instrument, deed or lease to which the Company, any of its
Subsidiaries or any other Obligor is a party or by which it is bound
(including the Master Shelf Agreement, the Pledge Agreement and the
Intercreditor Agreement), or of the Charter or By-laws of the Company, any
of its Subsidiaries or any other Obligor;
(b) the violation of any law, statute, judgment, decree or
governmental order, rule or regulation applicable to the Company, any of
its Subsidiaries or any other Obligor;
(c) the creation under any agreement, instrument, deed or lease
(including the Master Shelf Agreement, the Pledge Agreement and the
Intercreditor Agreement) of any Lien (other than Liens on the Credit
Security which secure the Credit Obligations) upon any of the assets of the
Company, any of its Subsidiaries or any other Obligor; or
(d) any redemption, retirement or other repurchase obligation of the
Company, any of its Subsidiaries or any other Obligor under any Charter,
By-law, agreement, instrument, deed or lease.
No approval, authorization or other action by, or declaration to or filing with,
any governmental or administrative authority or any other Person is required to
be obtained or made (which has not been so obtained or made), including any
approval, authorization, consent or other action of Prudential under the Master
Shelf Agreement, the Intercreditor Agreement and the Pledge Agreement, by the
Company, any of its Subsidiaries or any other Obligor in connection with the
execution, delivery and performance of this Agreement, the Notes or any other
Credit Document, the transactions contemplated hereby or thereby, the making of
any borrowing hereunder, the guaranteeing of the Credit Obligations or the
securing of the Credit Obligations with the Credit Security.
79
7.10. Defaults. Neither the Company nor any of its Subsidiaries is in
--------
default under any provision of its Charter or By-laws or of this Agreement or
any other Credit Document. Neither the Company nor any of its Subsidiaries is in
default under any provision of (a) the Subordinated Debentures, the Subordinated
Debentures Agreement or the Subordinated Debentures Guarantee, (b) the Master
Shelf Agreement or (c) any other agreement, instrument, deed or lease to which
it is party or by which it or its property is bound or has violated any law,
judgment, decree or governmental order, rule or regulation, in each case
referred to in this clause (c) so as to result, or create a material risk of
resulting, in any Material Adverse Effect.
7.11. Licenses, etc. To the best knowledge of the Company and the
-------------
Guarantors, the Company and its Subsidiaries have all material patents, patent
applications, patent licenses, patent rights, trademarks, trademark rights,
trade names, trade name rights, copyrights, licenses, franchises, permits,
authorizations and other rights as are necessary for the conduct of the business
of the Company and its Subsidiaries as now conducted by them. All of the
foregoing are in full force and effect in all material respects, and each of the
Company and its Subsidiaries is in substantial compliance with the foregoing
without any known conflict with the valid rights of others which has resulted,
or creates a material risk of resulting, in any Material Adverse Effect. No
event has occurred which permits, or after notice or lapse of time or both would
permit, the revocation or termination of any such license, franchise or other
right or which affects the rights of any of the Company and its Subsidiaries
thereunder so as to result, or to create a material risk of resulting, in any
Material Adverse Effect. No litigation or other proceeding or dispute exists
with respect to the validity or, where applicable, the extension or renewal, of
any of the foregoing which has resulted, or creates a material risk of
resulting, in any Material Adverse Effect.
7.12. Tax Returns. Each of the Company and its Subsidiaries has filed all
-----------
material tax and information returns or permitted extensions which are required
to be filed by it and has paid, or made adequate provision for the payment of,
all taxes which have or may become due pursuant to such returns or to any
assessment received by it. Neither the Company nor any of its Subsidiaries knows
of any material additional assessments or any basis therefor. The Company
reasonably believes that the charges, accruals and reserves on the books of the
Company and its Subsidiaries in respect of taxes or other governmental charges
are adequate.
80
7.13. Certain Business Representations.
--------------------------------
7.13.1. Labor Relations. No dispute or controversy between the
---------------
Company or any of its Subsidiaries and any of their respective employees
has resulted, or is reasonably likely to result, in any Material Adverse
Effect, and neither the Company nor any of its Subsidiaries anticipates
that its relationships with its unions or employees will result, or are
reasonably likely to result, in any Material Adverse Effect. The Company
and each of its Subsidiaries is in compliance in all material respects with
all federal and state laws with respect to (a) non-discrimination in
employment with which the failure to comply, in the aggregate, has
resulted, or creates a material risk of resulting, in a Material Adverse
Effect and (b) the payment of wages.
7.13.2. Antitrust. Each of the Company and its Subsidiaries is in
---------
compliance in all material respects with all federal and state antitrust
laws relating to its business and the geographic concentration of its
business.
7.13.3. Consumer Protection. Neither the Company nor any of its
-------------------
Subsidiaries is in violation of any rule, regulation, order, or
interpretation of any rule, regulation or order of the Federal Trade
Commission (including truth-in-lending), with which the failure to comply,
in the aggregate, has resulted, or creates a material risk of resulting, in
a Material Adverse Effect.
7.13.4. Burdensome Obligations. Neither the Company nor any of
----------------------
its Subsidiaries is party to or bound by any agreement, instrument, deed or
lease or is subject to any Charter, By-law or other restriction, commitment
or requirement which, in the opinion of the management of such Person, is
so unusual or burdensome as in the foreseeable future to result, or create
a material risk of resulting, in a Material Adverse Effect.
7.13.5. Future Expenditures. Neither the Company nor any of its
-------------------
Subsidiaries anticipate that the future expenditures, if any, by the
Company and its Subsidiaries needed to meet the provisions of any federal,
state or foreign governmental statutes, orders, rules or regulations will
be so burdensome as to result, or create a material risk of resulting, in
any Material Adverse Effect.
7.14. Environmental Regulations.
-------------------------
7.14.1. Environmental Compliance. To the best knowledge of the
------------------------
Company and the Guarantors, each of the Company and its Subsidiaries is in
compliance in all material respects with the Clean Air Act, the Federal
Water Pollution Control Act, the Marine Protection Research and Sanctuaries
Act, RCRA, CERCLA and any other Environmental Law in effect in any
jurisdiction in which any properties of the Company or any of its
Subsidiaries are located or where any of them conducts its business, and
with all applicable published rules and regulations (and applicable
standards and requirements) of the federal
81
Environmental Protection Agency and of any similar agencies in states or
foreign countries in which the Company or its Subsidiaries conducts its
business, in each case other than those which in the aggregate have not
resulted, and do not create a material risk of resulting, in a Material
Adverse Effect.
7.14.2. Environmental Litigation. Except in instances in which
------------------------
such event has not resulted, and does not create a material risk of
resulting, in a Material Adverse Effect, no suit, claim, action or
proceeding of which the Company or any of its Subsidiaries has been given
notice or otherwise has knowledge is now pending before any court,
governmental agency or board or other forum, or to the Company's or any of
its Subsidiaries' knowledge, threatened by any Person (nor to the Company's
or any of its Subsidiaries' knowledge, does any factual basis exist
therefor) for, and neither the Company nor any of its Subsidiaries have
received written correspondence from any federal, state or local
governmental authority with respect to:
(a) noncompliance by the Company or any of its Subsidiaries with
any Environmental Law;
(b) personal injury, wrongful death or other tortious conduct
relating to materials, commodities or products used, generated, sold,
transferred or manufactured by the Company or any of its Subsidiaries
(including products made of, containing or incorporating asbestos, lead or
other hazardous materials, commodities or toxic substances); or
(c) the release into the environment by the Company or any of
its Subsidiaries of any Hazardous Material generated by the Company or any
of its Subsidiaries whether or not occurring at or on a site owned, leased
or operated by the Company or any of its Subsidiaries.
7.14.3. Hazardous Material. Exhibit 7.14 contains a list as of
------------------
the date hereof of all waste disposal or dump sites at which Hazardous
Material generated by either the Company or any of its Subsidiaries has
been disposed of directly by the Company or any of its Subsidiaries and all
independent contractors to whom the Company and its Subsidiaries have
delivered Hazardous Material, or to the Company's or any of its
Subsidiaries' knowledge, where Hazardous Material finally came to be
located, and indicates all such sites which are or have been included
(including as a potential or suspect site) in any published federal, state
or local "superfund" or other list of hazardous or toxic waste sites,
except sites as to which the involvement of the Company or any Subsidiary
has not resulted, and does not present a material risk of resulting, in a
Material Adverse Effect. Any waste disposal or dump sites at which
Hazardous Material generated by either the Company or any of its
Subsidiaries has been disposed of directly by the Company or any of its
Subsidiaries and all independent contractors to whom the Company or any of
its Subsidiaries have delivered Hazardous Material, or to the Company's or
any of its Subsidiaries' knowledge, where Hazardous Material finally came
to
82
be located, has not resulted, and does not present a material risk of
resulting, in a Material Adverse Effect.
7.14.4. Environmental Condition of Properties. None of the
-------------------------------------
properties owned or leased by the Company or any of its Subsidiaries has
been used as a treatment, storage or disposal site, other than as disclosed
in Exhibit 7.14, except sites as to which the involvement of the Company or
any Subsidiary has not resulted, and does not present a material risk of
resulting, in a Material Adverse Effect. No Hazardous Material is present
in any real property currently or formerly owned or operated by the Company
or any of its Subsidiaries except that which has not resulted, and does not
present a material risk of resulting, in a Material Adverse Effect.
7.15. Pension Plans. Each Plan (other than a Multiemployer Plan) and,
-------------
to the knowledge of the Company and its Subsidiaries, each Multiemployer Plan is
in material compliance with the applicable provisions of ERISA and the Code.
Each Multiemployer Plan and each Plan that constitutes a "defined benefit plan"
(as defined in ERISA) are set forth in Exhibit 7.15. Each ERISA Group Person
has met all of the funding standards applicable to all Plans that are not
Multiemployer Plans, and no condition exists which would permit the institution
of proceedings to terminate any Plan that is not a Multiemployer Plan under
section 4042 of ERISA. To the best knowledge of the Company and each
Subsidiary, no Plan that is a Multiemployer Plan is currently insolvent or in
reorganization or has been terminated within the meaning of ERISA.
7.16. [Intentionally Omitted]
7.17. Foreign Trade Regulations; Government Regulation; Margin Stock.
--------------------------------------------------------------
7.17.1. Foreign Trade Regulations. Neither the execution and
-------------------------
delivery of this Agreement or any other Credit Document, nor the making by
the Company of any borrowings hereunder, nor the guaranteeing of the Credit
Obligations by any Guarantor, nor the securing of the Credit Obligations
with the Credit Security, has constituted or resulted in or will constitute
or result in the violation of any Foreign Trade Regulation.
7.17.2. Government Regulation. Neither the Company nor any of its
---------------------
Subsidiaries, nor any Person controlling the Company or any of its
Subsidiaries or under common control with the Company or any of its
Subsidiaries, is subject to regulation under the Public Utility Holding
Company Act of 1935, the Federal Power Act, the Investment Company Act, the
Interstate Commerce Act or any statute or regulation which regulates the
incurring by the Company or any of its Subsidiaries of Financing Debt as
contemplated by this Agreement and the other Credit Documents.
7.17.3. Margin Stock. Neither the Company nor any of its
------------
Subsidiaries owns any Margin Stock.
83
7.18. Disclosure. To the best knowledge of the Company and the
----------
Guarantors, neither this Agreement nor any other Credit Document to be furnished
to the Lenders by or on behalf of the Company or any of its Subsidiaries in
connection with the transactions contemplated hereby or by such Credit Document
contains any untrue statement of material fact or omits to state a material fact
necessary in order to make the statements contained herein or therein,
considered as a whole, not misleading in light of the circumstances under which
they were made. No fact is actually known to the Company or any Guarantor
which, so far as the Company or any Guarantor is aware, has resulted, or in the
future (so far as the Company or any Guarantor can reasonably foresee) will
result, or presents a material risk of resulting, in any Material Adverse
Change, except to the extent that present or future general economic conditions
may result in a Material Adverse Change.
7.19. Year 2000 Compliance. The Company and its Subsidiaries have (i)
--------------------
reviewed the areas within their business and operations which could be adversely
affected by failure to become "Year 2000 Compliant" (that is, that computer
applications, imbedded microchips and other systems used by the Company, its
Subsidiaries or its material vendors, will be able properly to recognize and
perform date-sensitive functions involving certain dates prior to and any date
after December 31, 1999); (ii) developed a detailed plan and timetable to become
Year 2000 Compliant in a timely manner; and (iii) committed adequate resources
to support its Year 2000 Plan. Based on such review and plan the Company and
its Subsidiaries reasonably believe that they will become Year 2000 Compliant on
a timely basis except to the extent that a failure to do so will not have a
Material Adverse Effect.
8. Defaults.
--------
8.1. Events of Default. The following events are referred to as "Events
----------------- ------
of Default":
----------
8.1.1. Payment. The Company shall fail to make any payment in
-------
respect of: (a) interest or any fee on or in respect of any of the Credit
Obligations owed by it as the same shall become due and payable, and such
failure shall continue for a period of three Banking Days, or (b) any
Credit Obligation with respect to payments made by any Letter of Credit
Issuer under any Letter of Credit or any draft drawn thereunder within
three Banking Days after demand therefor by such Letter of Credit Issuer or
(c) principal of any of the Credit Obligations owed by it as the same shall
become due, whether at maturity or by acceleration or otherwise.
8.1.2. Specified Covenants. The Company or any of its
-------------------
Subsidiaries shall fail to perform or observe any of the provisions of
Section 6.2.5, 6.4.6, 6.5, 6.6, 6.7, 6.8, 6.11, 6.12 or 6.19.
84
8.1.3. Other Covenants. The Company, any of its Subsidiaries or
---------------
any other Obligor shall fail to perform or observe any other covenant,
agreement or provision to be performed or observed by it under this
Agreement or any other Credit Document, and such failure shall not be
rectified or cured to the written satisfaction of the Required Lenders
within 30 days after the earlier of (a) notice thereof by the Agent to the
Company or (b) a Financial Officer shall have actual knowledge thereof.
8.1.4. Representations and Warranties. Any representation or
------------------------------
warranty of or with respect to the Company, any of its Subsidiaries or any
other Obligor made to the Lenders or the Agent in, pursuant to or in
connection with this Agreement or any other Credit Document shall be
materially false on the date as of which it was made.
8.1.5. Cross Default, etc.
------------------
(a) The Company or any of its Subsidiaries shall fail to make any
payment when due (after giving effect to any applicable grace periods) in
respect of any Financing Debt (other than the Credit Obligations)
outstanding in an aggregate amount of principal (whether or not due) and
accrued interest exceeding $3,000,000, and such failure shall continue,
without having been duly cured, waived or consented to, beyond the period
of grace, if any, specified in the agreement or instrument governing such
Financing Debt;
(b) the Company or any of its Subsidiaries shall fail to perform
or observe the terms of any agreement or instrument relating to such
Financing Debt, and such failure shall continue, without having been duly
cured, waived or consented to, beyond the period of grace, if any,
specified in such agreement or instrument, and such failure shall permit
the acceleration of such Financing Debt;
(c) all or any part of such Financing Debt of the Company or any
of its Subsidiaries shall be accelerated or shall become due or payable
prior to its stated maturity (except with respect to voluntary prepayments
thereof) for any reason whatsoever;
(d) any Lien on any property of the Company or any of its
Subsidiaries securing any such Financing Debt shall be enforced by
foreclosure or similar action; or
85
(e) any holder of any such Financing Debt shall exercise any right
of rescission or put right with respect thereto.
8.1.6. Ownership; Liquidation; etc. Except as permitted by
---------------------------
Section 6.11:
(a) The Company shall cease to own, directly or indirectly, all
the capital stock of any Subsidiary which is a Wholly Owned Subsidiary on
the date hereof or subsequently becomes a Wholly Owned Subsidiary;
(b) any Person, together with "affiliates" and "associates" of
such Person within the meaning of Rule 12b-2 of the Exchange Act, which is
not now a beneficial owner of equity securities of the Company shall
acquire after the date hereof beneficial ownership within the meaning of
Rule 13d-3 of the Exchange Act of 50% or more of either the voting stock or
total equity capital of the Company;
(c) a majority of the board of directors shall consist of
individuals who were not on the date hereof members of such board, except
to the extent that the new members were nominated by a majority of the
directors serving on the date hereof; and
(d) the Company or any of its Subsidiaries or any other Obligor
shall initiate any action to dissolve, liquidate or otherwise terminate its
existence.
8.1.7. Enforceability, etc. Any Credit Document shall cease for
-------------------
any reason (other than the scheduled termination thereof in accordance with
its terms) to be enforceable in accordance with its terms or in full force
and effect and such enforceability shall not be restored, or other
provision therefor made, to the satisfaction of the Required Lenders within
30 days following such cessation; or any party to any Credit Document shall
so assert in a judicial or similar proceeding; or the security interests
created by this Agreement or any other Credit Documents shall cease to be
enforceable and of the same effect and priority purported to be created
hereby.
8.1.8. Judgments. A final judgment (a) which, with other
---------
outstanding final judgments against the Company and its Subsidiaries,
exceeds an aggregate of $1,000,000 in excess of applicable insurance
coverage shall be rendered against the Company or any of its Subsidiaries,
or (b) which grants injunctive relief that results, or creates a material
risk of resulting, in a Material Adverse Change and in either case if, (i)
within 60 days after entry thereof, such judgment shall not have been
discharged or execution thereof stayed pending appeal or (ii) within 60
days after the expiration of any such stay, such judgment shall not have
been discharged.
86
8.1.9. ERISA. Any "reportable event" (as defined in section
-----
4043 of ERISA) shall have occurred that reasonably could be expected to
result in termination of a Plan or the appointment by the appropriate
United States District Court of a trustee to administer any Plan or the
imposition of a Lien in favor of a Plan; or any ERISA Group Person shall
fail to pay when due amounts aggregating in excess of $1,000,000 which it
shall have become liable to pay to the PBGC or to a Plan under Title IV of
ERISA; or notice of intent to terminate a Plan shall be filed under Title
IV of ERISA by any ERISA Group Person or administrator; or the PBGC shall
institute proceedings under Title IV of ERISA to terminate or to cause a
trustee to be appointed to administer any Plan or a proceeding shall be
instituted by a fiduciary of any Plan against any ERISA Group Person to
enforce section 515 or 4219(c)(5) of ERISA and such proceeding shall not
have been dismissed within 60 days thereafter; or a condition shall exist
by reason of which the PBGC would be entitled to obtain a decree
adjudicating that any Plan must be terminated.
8.1.10. Bankruptcy, etc. The Company, any of its Subsidiaries or
---------------
any other Obligor shall:
(a) commence a voluntary case under the Bankruptcy Code or
authorize, by appropriate proceedings of its board of directors or other
governing body, the commencement of such a voluntary case;
(b) (i) have filed against it a petition commencing an involuntary
case under the Bankruptcy Code that shall not have been dismissed within 90
days after the date on which such petition is filed, or (ii) file an answer
or other pleading within such 90-day period admitting or failing to deny
the material allegations of such a petition or seeking, consenting to or
acquiescing in the relief therein provided, or (iii) have entered against
it an order for relief in any involuntary case commenced under the
Bankruptcy Code;
(c) seek relief as a debtor under any applicable law, other than
the Bankruptcy Code, of any jurisdiction relating to the liquidation or
reorganization of debtors or to the modification or alteration of the
rights of creditors, or consent to or acquiesce in such relief;
(d) have entered against it an order by a court of competent
jurisdiction (i) finding it to be bankrupt or insolvent, (ii) ordering or
approving its liquidation or reorganization as a debtor or any modification
or alteration of the rights of its creditors or (iii) assuming custody of,
or appointing a receiver or other custodian for, all or a substantial
portion of its property; or
(e) make an assignment for the benefit of, or enter into a
composition with, its creditors, or appoint, or consent to the appointment
of, or suffer to exist a receiver or other custodian for, all or a
substantial portion of its property.
87
8.1.11. Subordinated Debentures. There shall occur any "Event of
-----------------------
Default" as defined in Section 13.1 of the Subordinated Debentures
Agreement, or any of the Credit Obligations shall fail to be "Superior
Indebtedness" within the meaning of Section 10 of the Subordinated
Debentures Agreement.
8.2. Certain Actions Following an Event of Default. If any one or more
---------------------------------------------
Events of Default shall occur, then in each and every such case:
8.2.1. Terminate Obligation to Extend Credit. The Agent on
-------------------------------------
behalf of the Lenders may (and upon written request of the Required Lenders
the Agent shall) terminate the obligations of the Lenders to make any
further extensions of credit under the Credit Documents by furnishing
notice of such termination to the Company.
8.2.2. Specific Performance; Exercise of Rights. The Agent on
----------------------------------------
behalf of the Lenders may (and upon written request of the Required Lenders
the Agent shall) proceed to protect and enforce the Lenders' rights by suit
in equity, action at law and/or other appropriate proceeding, either for
specific performance of any covenant or condition contained in this
Agreement or any other Credit Document or in any instrument or assignment
delivered to the Lenders pursuant to this Agreement or any other Credit
Document, or in aid of the exercise of any power granted in this Agreement
or any other Credit Document or any such instrument or assignment.
8.2.3. Acceleration. The Agent on behalf of the Lenders may
------------
(and upon written request of the Required Lenders the Agent shall) by
notice in writing to the Company (a) declare all or any part of the unpaid
balance of the Credit Obligations then outstanding to be immediately due
and payable, and (b) require the Company immediately to deposit with the
Agent in cash an amount equal to the then Letter of Credit Exposure (which
cash shall be held and applied as provided in Section 4.5), and thereupon
such unpaid balance or part thereof and such amount equal to the Letter of
Credit Exposure shall become so due and payable without presentation,
protest or further demand or notice of any kind, all of which are hereby
expressly waived; provided, however, that if a Bankruptcy Default shall
-------- -------
have occurred, the unpaid balance of the Credit Obligations shall
automatically become immediately due and payable.
8.2.4. Enforcement of Payment; Credit Security; Setoff. The
-----------------------------------------------
Agent on behalf of the Lenders may (and upon written request of the
Required Lenders the Agent shall) proceed to enforce payment of the Credit
Obligations in such manner as it may elect, to cancel, or instruct other
Letter of Credit Issuers to cancel, any outstanding Letters of Credit which
permit the cancellation thereof and to realize upon any and all rights in
the Credit Security. The Lenders may offset and apply toward the payment
of the Credit Obligations (and/or toward the curing of any Event of
Default) any Indebtedness from the Lenders to the respective Obligors,
including any Indebtedness represented by deposits in any account
maintained
88
with the Lenders, regardless of the adequacy of any security for the Credit
Obligations. The Lenders shall have no duty to determine the adequacy of
any such security in connection with any such offset.
8.2.5. Cumulative Remedies. To the extent not prohibited by
-------------------
applicable law which cannot be waived, all of the Lenders' rights hereunder
and under each other Credit Document shall be cumulative.
8.3. Annulment of Defaults. Once an Event of Default has occurred,
---------------------
such Event of Default shall be deemed to exist and be continuing for all
purposes of the Credit Documents until the Required Lenders or the Agent (with
the consent of the Required Lenders) shall have waived such Event of Default in
writing, stated in writing that the same has been cured to such Lenders'
reasonable satisfaction or entered into an amendment to this Agreement which by
its express terms cures such Event of Default, at which time such Event of
Default shall no longer be deemed to exist or to have continued. No such action
by the Lenders or the Agent shall extend to or affect any subsequent Event of
Default or impair any rights of the Lenders upon the occurrence thereof. The
making of any extension of credit during the existence of any Default or Event
of Default shall not constitute a waiver thereof.
8.4. Waivers. To the extent that such waiver is not prohibited by the
-------
provisions of applicable law that cannot be waived, each of the Company and the
other Obligors waives:
(a) all presentments, demands for performance, notices of
nonperformance (except to the extent required by this Agreement or any
other Credit Document), protests, notices of protest and notices of
dishonor;
(b) any requirement of diligence or promptness on the part of any
Lender in the enforcement of its rights under this Agreement, the Notes or
any other Credit Document;
(c) any and all notices of every kind and description which may be
required to be given by any statute or rule of law; and
(d) any defense (other than indefeasible payment in full) which it
may now or hereafter have with respect to its liability under this
Agreement, the Notes or any other Credit Document or with respect to the
Credit Obligations.
9. Guarantees.
----------
9.1. Guarantees of Credit Obligations. Each Guarantor unconditionally
--------------------------------
jointly and severally guarantees that the Credit Obligations will be performed
and will be paid in full in cash when due and payable, whether at the stated or
accelerated maturity thereof or otherwise, this guarantee being a guarantee of
payment and not of collectability and being absolute and in no way conditional
or contingent. In the event any part of the Credit
89
Obligations shall not have been so paid in full when due and payable, each
Guarantor will, immediately upon notice by the Agent or, without notice,
immediately upon the occurrence of a Bankruptcy Default, pay or cause to be paid
to the Agent for the account of each Lender in accordance with the Lenders'
respective Percentage Interests the amount of such Credit Obligations which are
then due and payable and unpaid. The obligations of each Guarantor hereunder
shall not be affected by the invalidity, unenforceability or irrecoverability of
any of the Credit Obligations as against any other Obligor, any other guarantor
thereof or any other Person. For purposes hereof, the Credit Obligations shall
be due and payable when and as the same shall be due and payable under the terms
of this Agreement or any other Credit Document notwithstanding the fact that the
collection or enforcement thereof may be stayed or enjoined under the Bankruptcy
Code or other applicable law.
9.2. Continuing Obligation. Each Guarantor acknowledges that the Lenders
---------------------
and the Agent have entered into this Agreement (and, to the extent that the
Lenders or the Agent may enter into any future Credit Document, will have
entered into such agreement) in reliance on this Section 9 being a continuing
irrevocable agreement, and such Guarantor agrees that its guarantee may not be
revoked in whole or in part. The obligations of the Guarantors hereunder shall
terminate when the commitment of the Lenders to extend credit under this
Agreement shall have terminated and all of the Credit Obligations have been
indefeasibly paid in full in cash and discharged; provided, however, that:
-------- -------
(a) if a claim is made upon the Lenders at any time for repayment or
recovery of any amounts or any property received by the Lenders from any
source on account of any of the Credit Obligations and the Lenders repay or
return any amounts or property so received (including interest thereon to
the extent required to be paid by the Lenders) or
(b) if the Lenders become liable for any part of such claim by reason
of (i) any judgment or order of any court or administrative authority
having competent jurisdiction, or (ii) any settlement or compromise of any
such claim of which the Company has notice and an opportunity to comment,
then the Guarantors shall remain liable under this Agreement for the amounts so
repaid or property so returned or the amounts for which the Lenders become
liable (such amounts being deemed part of the Credit Obligations) to the same
extent as if such amounts or property had never been received by the Lenders,
notwithstanding any termination hereof or the cancellation of any instrument or
agreement evidencing any of the Credit Obligations. Not later than five days
after receipt of notice from the Agent, the Guarantors shall jointly and
severally pay to the Agent an amount equal to the amount of such repayment or
return for which the Lenders have so become liable. Payments hereunder by a
Guarantor may be required by the Agent on any number of occasions.
9.3. Waivers with Respect to Credit Obligations. Except to the extent
------------------------------------------
expressly required by this Agreement or any other Credit Document, each
Guarantor
90
waives, to the fullest extent permitted by the provisions of applicable law, all
of the following (including all defenses, counterclaims and other rights of any
nature based upon any of the following):
(a) presentment, demand for payment and protest of nonpayment of any
of the Credit Obligations, and notice of protest, dishonor or
nonperformance;
(b) notice of acceptance of this guarantee and notice that credit has
been extended in reliance on the Guarantor's guarantee of the Credit
Obligations;
(c) notice of any Default or of any inability to enforce performance
of the obligations of the Company or any other Person with respect to any
Credit Document, or notice of any acceleration of maturity of any Credit
Obligations;
(d) demand for performance or observance of, and any enforcement of
any provision of, the Credit Obligations, this Agreement or any other
Credit Document or any pursuit or exhaustion of rights or remedies with
respect to any Credit Security or against the Company or any other Person
in respect of the Credit Obligations or any requirement of diligence or
promptness on the part of the Agent or the Lenders in connection with any
of the foregoing;
(e) any act or omission on the part of the Agent or the Lenders which
may impair or prejudice the rights of the Guarantor, including rights to
obtain subrogation, exoneration, contribution, indemnification or any other
reimbursement from the Company or any other Person, or otherwise operate as
a deemed release or discharge;
(f) failure or delay to perfect or continue the perfection of any
security interest in any Credit Security or any other action which ▇▇▇▇▇ or
impairs the value of, or any failure to preserve or protect the value of,
any Credit Security;
(g) any statute of limitations or any statute or rule of law which
provides that the obligation of a surety must be neither larger in amount
nor in other respects more burdensome than the obligation of the principal;
(h) any "single action" or "anti-deficiency" law which would otherwise
prevent the Lenders from bringing any action, including any claim for a
deficiency, against the Guarantor before or after the Agent's or the
Lenders' commencement or completion of any foreclosure action, whether
judicially, by exercise of power of sale or otherwise, or any other law
which would otherwise require any election of remedies by the Agent or the
Lenders;
(i) all demands and notices of every kind with respect to the
foregoing; and
91
(j) to the extent not referred to above, all defenses (other than
payment) which the Company may now or hereafter have to the payment of the
Credit Obligations, together with all suretyship defenses, which could
otherwise be asserted by such Guarantor.
Each Guarantor represents that it has obtained the advice of counsel as to the
extent to which suretyship and other defenses may be available to it with
respect to its obligations hereunder in the absence of the waivers contained in
this Section 9.3.
No delay or omission on the part of the Agent or the Lenders in exercising
any right under this Agreement or any other Credit Document or under any
guarantee of the Credit Obligations or with respect to the Credit Security shall
operate as a waiver or relinquishment of such right. No action which the Agent
or the Lenders or the Company may take or refrain from taking with respect to
the Credit Obligations, including any amendments thereto or modifications
thereof or waivers with respect thereto, shall affect the provisions of this
Agreement or the obligations of the Guarantor hereunder. None of the Lenders'
or the Agent's rights shall at any time in any way be prejudiced or impaired by
any act or failure to act on the part of any Obligor, or by any noncompliance by
the Company with the terms, provisions and covenants of this Agreement,
regardless of any knowledge thereof which the Agent or the Lenders may have or
otherwise be charged with.
9.4. Lenders' Power to Waive, etc. Each Guarantor grants to the Lenders
----------------------------
full power in their discretion, without notice to or consent of such Guarantor,
such notice and consent being expressly waived to the fullest extent permitted
by applicable law, and without in any way affecting the liability of the
Guarantor under its guarantee hereunder:
(a) To waive compliance with, and any Default under, and to consent to
any amendment to or modification or termination of any terms or provisions
of, or to give any waiver in respect of, this Agreement, any other Credit
Document, the Credit Security, the Credit Obligations or any guarantee
thereof (each as from time to time in effect);
(b) To grant any extensions of the Credit Obligations (for any
duration), and any other indulgence with respect thereto, and to effect any
total or partial release (by operation of law or otherwise), discharge,
compromise or settlement with respect to the obligations of the Obligors or
any other Person in respect of the Credit Obligations, whether or not
rights against the Guarantor under this Agreement are reserved in
connection therewith;
(c) To take security in any form for the Credit Obligations, and to
consent to the addition to or the substitution, exchange, release or other
disposition of, or to deal in any other manner with, any part of any
property contained in the Credit Security whether or not the property, if
any, received upon the exercise of such power shall be of a character or
value the same as or different from the character or value of any property
disposed of, and to obtain, modify or
92
release any present or future guarantees of the Credit Obligations and to
proceed against any of the Credit Security or such guarantees in any order;
(d) To collect or liquidate or realize upon any of the Credit
Obligations or the Credit Security in any manner or to refrain from
collecting or liquidating or realizing upon any of the Credit Obligations
or the Credit Security; and
(e) To extend credit under this Agreement, any other Credit Document
or otherwise in such amount as the Lenders may determine, including
increasing the amount of credit and the interest rate and fees with respect
thereto, even though the condition of the Obligors (financial or otherwise
on an individual or Consolidated basis) may have deteriorated since the
date hereof.
9.5. Information Regarding the Company, etc. Each Guarantor has made such
--------------------------------------
investigation as it deems desirable of the risks undertaken by it in entering
into this Agreement and is fully satisfied that it understands all such risks.
Each Guarantor waives any obligation which may now or hereafter exist on the
part of the Agent or the Lenders to inform it of the risks being undertaken by
entering into this Agreement or of any changes in such risks and, from and after
the date hereof, each Guarantor undertakes to keep itself informed of such risks
and any changes therein. Each Guarantor expressly waives any duty which may now
or hereafter exist on the part of the Agent or the Lenders to disclose to the
Guarantor any matter related to the business, operations, character, collateral,
credit, condition (financial or otherwise), income or prospects of the Company
or its Affiliates or their properties or management, whether now or hereafter
known by the Agent or the Lenders. Each Guarantor represents, warrants and
agrees that it assumes sole responsibility for obtaining from the Company all
information concerning this Agreement and all other Credit Documents and all
other information as to the Company and its Affiliates or their properties or
management as such Guarantor deems necessary or desirable.
9.6. Certain Guarantor Representations. Each Guarantor represents that:
---------------------------------
(a) it is in its best interest and in pursuit of the purposes for
which it was organized as an integral part of the business conducted and
proposed to be conducted by the Company and its Subsidiaries, and
reasonably necessary and convenient in connection with the conduct of the
business conducted and proposed to be conducted by them, to induce the
Lenders to enter into this Agreement and to extend credit to the Company by
making the Guarantees contemplated by this Section 9,
(b) the credit available hereunder will directly or indirectly inure
to its benefit,
(c) by virtue of the foregoing it is receiving at least reasonably
equivalent value from the Lenders for its Guarantee,
93
(d) it will not be rendered insolvent as a result of entering into
this Agreement,
(e) after giving effect to the transactions contemplated by this
Agreement, it will have assets having a fair saleable value in excess of
the amount required to pay its probable liability on its existing debts as
they become absolute and matured,
(f) it has, and will have, access to adequate capital for the conduct
of its business,
(g) it has the ability to pay its debts from time to time incurred in
connection therewith as such debts mature, and
(h) it has been advised by the Agent that the Lenders are unwilling to
enter into this Agreement unless the Guarantees contemplated by this
Section 9 are given by it.
9.7. Subrogation. Each Guarantor agrees that, until the Credit Obligations
-----------
are paid in full, it will not exercise any right of reimbursement, subrogation,
contribution, offset or other claims against the other Obligors arising by
contract or operation of law in connection with any payment made or required to
be made by such Guarantor under this Agreement. After the payment in full of the
Credit Obligations, each Guarantor shall be entitled to exercise against the
Company and the other Obligors all such rights of reimbursement, subrogation,
contribution and offset, and all such other claims, to the fullest extent
permitted by law.
9.8. Subordination. Each Guarantor covenants and agrees that, after the
-------------
occurrence of an Event of Default, all Indebtedness, claims and liabilities then
or thereafter owing by the Company or any other Obligor to such Guarantor
whether arising hereunder or otherwise are subordinated to the prior payment in
full of the Credit Obligations and are so subordinated as a claim against such
Obligor or any of its assets, whether such claim be in the ordinary course of
business or in the event of voluntary or involuntary liquidation, dissolution,
insolvency or bankruptcy, so that no payment with respect to any such
Indebtedness, claim or liability will be made or received while any Event of
Default exists.
9.9. Future Subsidiaries; Further Assurances. The Company will from time
---------------------------------------
to time cause (a) any present Wholly Owned Subsidiary that is not a Guarantor
within 30 days after notice from the Agent or (b) any future Wholly Owned
Subsidiary within 30 days after any such Person becomes a Wholly Owned
Subsidiary, to join this Agreement as a Guarantor pursuant to a joinder
agreement in form and substance satisfactory to the Agent. Each Guarantor will,
promptly upon the request of the Agent from time to time, execute, acknowledge
and deliver, and file and record, all such instruments, and take all such
action, as the Agent deems necessary or advisable to carry out the intent and
purposes of this Section 9.
94
10. Security.
--------
10.1. Credit Security. As security for the payment and performance of
---------------
the Credit Obligations, each Obligor mortgages, pledges and collaterally grants
and assigns to the Agent for the benefit of the Lenders and the holders from
time to time of any Credit Obligation, and creates a security interest in favor
of the Agent for the benefit of the Lenders and such holders in, all of such
Obligor's right, title and interest in and to (but none of its obligations or
liabilities with respect to) the items and types of present and future property
described in Sections 10.1.1 through 10.1.4 (subject, however, to Section
10.1.5), whether now owned or hereafter acquired, all of which shall be included
in the term "Credit Security":
---------------
10.1.1. Pledged Stock. (a) All shares of capital stock or other
-------------
evidence of beneficial interest in any corporation, business trust or
limited liability company, including without limitation of all shares of
stock of each of TransMontaigne Transportation Services, Inc.,
TransMontaigne Product Services Inc., Bear Paw Energy Inc. and
TransMontaigne Holding Inc. owned by the Company, all shares of stock of
TransMontaigne Pipeline Inc. and TransMontaigne Terminaling Inc. owned by
TransMontaigne Transportation Services Inc., all shares of stock of
TransMontaigne Product Services Midwest Inc. and LDEC (to be renamed
TransMontaigne Product Services East Inc.) owned by TransMontaigne Product
Services Inc. and all shares of West Shore Pipe Line Company owned by
TransMontaigne Pipeline Inc., (b) all limited partnership interests in any
limited partnership, (c) all general partnership interests in any general
partnership, (d) all joint venture interests in any joint venture and (e)
all options, warrants and similar rights to acquire such capital stock or
such interests. All such capital stock, interests, options, warrants and
other rights are collectively referred to as the "Pledged Stock".
-------------
10.1.2. Pledged Rights. All rights to receive profits or surplus
--------------
of, or other Distributions (including income, return of capital and
liquidating distributions) from, any corporation, business trust, limited
liability company, partnership or joint venture, including any
distributions by any such Person to partners or joint venturers. All such
rights are collectively referred to as the "Pledged Rights".
--------------
10.1.3. Pledged Indebtedness. All Indebtedness from time to time
--------------------
owing to such Obligor from any Obligor or any Subsidiary of any Obligor
(all such Indebtedness being referred to as the "Pledged Indebtedness").
--------------------
10.1.4. Proceeds and Products. All proceeds, including insurance
---------------------
proceeds, and products of the items of Credit Security described or
referred to in Sections 10.1.1 through 10.1.3 and, to the extent not
included in the foregoing, all Distributions with respect to the Pledged
Securities.
95
10.1.5. Excluded Property. Notwithstanding Sections 10.1.1 through
-----------------
10.1.4, the payment and performance of the Credit Obligations shall not be
secured by:
(a) any rights arising under, and any property, tangible or
intangible, acquired under, any agreement which validly prohibits the
creation by such Obligor of a security interest in such rights or property;
(b) any rights or property to the extent that any valid and
enforceable law or regulation applicable to such rights or property
prohibits the creation of a security interest therein; or
(c) more than 66% of the outstanding stock or other equity in any
foreign Subsidiary.
10.2. [Intentionally Omitted].
10.3. Representations, Warranties and Covenants with Respect to Credit
----------------------------------------------------------------
Security. Each Obligor represents, warrants and covenants that:
--------
10.3.1. Pledged Stock. All shares of capital stock, limited
-------------
partnership interests, membership interests, beneficial interests and
similar securities included in the Pledged Stock are and shall be at all
times duly authorized, validly issued, fully paid and (in the case of
capital stock and limited partnership interests) nonassessable. Each
Obligor will deliver to the Agent certificates representing any Pledged
Stock represented by a certificate, accompanied by a stock transfer power
executed in blank and, if the Agent so requests, with the signature
guaranteed, all in form and manner satisfactory to the Agent. Pledged
Stock that is not evidenced by a certificate will be registered in the
Agent's name as pledgee on the issuer's records, all in form and substance
satisfactory to the Agent. At any time after the occurrence of an Event of
Default, the Agent may transfer into its name or the name of its nominee,
as pledgee, any Pledged Securities. In the event the Pledged Stock
includes any Margin Stock, the Obligors will furnish to the Lenders Federal
Reserve Form U-1 and take such other action as the Agent may request to
ensure compliance with applicable laws.
10.3.2. Pledged Indebtedness. All Pledged Indebtedness owed by
--------------------
any Affiliate of the Obligors shall be on open account and shall not be
evidenced by any note or other instrument; provided, however, that all
-------- -------
Pledged Indebtedness owed by any Obligor shall, if the Agent requests, be
evidenced by a promissory note, which note shall be delivered to the Agent
after having been endorsed in blank. Each Obligor will, immediately upon
the receipt thereof, deliver to the Agent any promissory note or similar
instrument representing any Pledged Indebtedness, after having endorsed
such promissory note or instrument in blank.
10.3.3. [Intentionally Omitted].
96
10.3.4. No Liens or Restrictions on Transfer or Change of Control.
---------------------------------------------------------
All Credit Security shall be free and clear of any Liens and restrictions
on the transfer thereof, including contractual provisions which prohibit
the assignment of rights under contracts, except for Liens permitted by
Section 6.8. Without limiting the generality of the foregoing, each
Obligor will exclude from contracts to which it becomes a party after the
date hereof (other than partnership and joint venture agreements)
provisions that would prevent such Obligor from creating a security
interest in such contract or any property acquired thereunder as
contemplated hereby. None of the Pledged Stock is subject to any adverse
claims, option to purchase or similar rights of any Person. Except with the
written consent of the Agent, no Obligor is, and none of them will be,
party to or bound by any agreement, instrument, deed or lease that
restricts the change of control or ownership, or the creation of a security
interest in the ownership, of the Company or any of its Subsidiaries (other
than a Subsidiary which is a partnership).
10.3.5. [Intentionally Omitted].
10.3.6. Trade Names. No Obligor will adopt or do business under
-----------
any name other than its name or names designated in Exhibit 7.1 or any
other name specified by notice actually received by the Agent not less than
ten Banking Days prior to the conduct of business under such additional
name. Since its incorporation, no Obligor has changed its corporate name
or adopted or conducted business under any trade name other than a name
specified on Exhibit 7.1.
10.3.7. [Intentionally Omitted].
10.3.8. Modifications to Credit Security. Except with the prior
--------------------------------
written consent of the Agent, no Obligor shall amend or modify, or waive
any of its rights under or with respect to, any Pledged Securities if the
effect of such amendment, modification or waiver would be to reduce the
amount of any such items or to extend the time of payment thereof, to waive
any default by any other party thereto, or to waive or impair any remedies
of the Obligors or the Lenders under or with respect to any Pledged
Securities, in each case other than consistent with past practice in the
ordinary course of business and on an arm's-length basis. Each Obligor
will promptly give the Agent written notice of any request by any Person
for any credit or adjustment with respect to any Pledged Securities.
10.3.9. Delivery of Documents. At the Agent's request, each
---------------------
Obligor shall deliver to the Agent, promptly upon such Obligor's receipt
thereof, copies of any agreements, instruments, documents or invoices
comprising or relating to the Credit Security. Pending such request, such
Obligor shall keep such items at its chief executive office and principal
place of business, which office and place of business shall be set forth in
Exhibit 7.1, or at such other address as such Obliger may specify by notice
actually received by the Agent not less than ten Banking Days prior to such
change of address.
97
10.3.10. Perfection of Credit Security. Upon the Agent's request
-----------------------------
from time to time, the Obligors will execute and deliver, and file and
record in the proper filing and recording places, all such instruments,
including financing statements, collateral assignments of copyrights,
trademarks and patents, mortgages or deeds of trust, and notations on
certificates of title and will take all such other action, as the Agent
deems advisable for confirming to it the Credit Security or to carry out
any other purposes of this Agreement or any other Credit Document.
10.4. Administration of Credit Security. The Credit Security shall be
---------------------------------
administered as follows; and if an Event of Default shall have occurred, Section
10.5 shall also apply.
10.4.1. Use of Credit Security. Until the Agent provides written
----------------------
notice to the contrary, each Obligor may use, commingle and dispose of any
part of the Credit Security in the ordinary course of its business, all
subject to Section 6.11.
10.4.2. [Intentionally Omitted].
10.4.3. Pledged Securities.
------------------
(a) Distributions.
-------------
(i) Until an Event of Default shall occur, the respective
Obligors shall be entitled to receive all Distributions on or with
respect to the Pledged Securities (other than Distributions
constituting additional Pledged Securities). All Distributions
constituting additional Pledged Securities will be retained by the
Agent (or if received by any Obligor shall be held by such Person in
trust and shall be immediately delivered by such Person to the Agent
in the original form received, endorsed in blank) and held by the
Agent as part of the Credit Security.
(ii) If an Event of Default shall have occurred, all
Distributions on or with respect to the Pledged Securities shall be
retained by the Agent (or if received by any Obligor shall be held by
such Person in trust and shall be immediately delivered by it to the
Agent in the original form received, endorsed in blank) and held by
the Agent as part of the Credit Security or applied by the Agent to
the payment of the Credit Obligations in accordance with Section
10.5.6.
(b) Voting.
------
(i) Until an Event of Default shall occur, the respective
Obligors shall be entitled to vote or consent or refrain from voting
or consenting with respect to the Pledged Securities in any manner not
inconsistent with
98
the terms of any Credit Document, and the Agent will, if so requested,
execute appropriate revocable proxies therefor.
(ii) If an Event of Default shall have occurred, if and to the
extent that the Agent shall so notify in writing the Obligor pledging
the Pledged Securities in question, only the Agent shall be entitled
to vote or consent or take any other action with respect to the
Pledged Securities (and any Obligor will, if so requested, execute or
cause to be executed appropriate proxies therefor).
10.5. Right to Realize upon Credit Security. Except to the extent
-------------------------------------
prohibited by applicable law that cannot be waived, this Section 10.5 shall
govern the Lenders' right to realize upon the Credit Security if any Event of
Default shall have occurred. The provisions of this Section 10.5 are in
addition to any rights and remedies available at law or in equity and in
addition to the provisions of any other Credit Document. In the case of a
conflict between this Section 10.5 and any other Credit Document, this Section
10.5 shall govern.
10.5.1. Assembly of Credit Security; Receiver. Each of the Obligors
-------------------------------------
shall, upon the Agent's request, assemble the Credit Security and otherwise
make it available to the Agent. The Agent may have a receiver appointed for
all or any portion of the Obligor's assets or business which constitutes
the Credit Security in order to manage, protect, preserve, sell and
otherwise dispose of all or any portion of the Credit Security in
accordance with the terms of the Credit Documents, to continue the
operations of the Obligors and to collect all revenues and profits
therefrom to be applied to the payment of the Credit Obligations, including
the compensation and expenses of such receiver.
10.5.2. General Authority. To the extent specified in written
-----------------
notice from the Agent to the Obligor in question, each Obligor grants the
Agent full and exclusive power and authority, subject to the other terms
hereof and applicable law, to take any of the following actions (for the
sole benefit of the Agent on behalf of the Lenders and the holders from
time to time of any Credit Obligations, but at the Obligor's expense):
(a) To ask for, demand, take, collect, ▇▇▇ for and receive all
payments in respect of any Pledged Securities which the Obligor could
otherwise ask for, demand, take, collect, ▇▇▇ for and receive for its own
use.
(b) To extend the time of payment of any Pledged Securities and to
make any allowance or other adjustment with respect thereto.
(c) To settle, compromise, prosecute or defend any action or
proceeding with respect to any Pledged Securities and to enforce all rights
and remedies thereunder which the Obligor could otherwise enforce.
99
(d) To enforce the payment of any Pledged Securities, either in the
name of the Obligor or in its own name, and to endorse the name of the
Obligor on all checks, drafts, money orders and other instruments tendered
to or received in payment of any Credit Security.
(e) To notify the third party payor with respect to any Pledged
Securities of the existence of the security interest created hereby and to
cause all payments in respect thereof thereafter to be made directly to the
Agent; provided, however, that whether or not the Agent shall have so
-------- -------
notified such payor, the Obligors will at their expense render all
reasonable assistance to the Agent in collecting such items and in
enforcing claims thereon.
(f) To sell, transfer, assign or otherwise deal in or with any Credit
Security or the proceeds thereof, as fully as any Obligor otherwise could
do.
10.5.3. Marshaling, etc. Neither the Agent nor the Lenders shall
---------------
be required to make any demand upon, or pursue or exhaust any of their
rights or remedies against, any Obligor or any other guarantor, pledgor or
any other Person with respect to the payment of the Credit Obligations or
to pursue or exhaust any of their rights or remedies with respect to any
collateral therefor or any direct or indirect guarantee thereof. Neither
the Agent nor the Lenders shall be required to marshal the Credit Security
or any guarantee of the Credit Obligations or to resort to the Credit
Security or any such guarantee in any particular order, and all of its and
their rights hereunder or under any other Credit Document shall be
cumulative. To the extent it may lawfully do so, each of the Obligors
absolutely and irrevocably waives and relinquishes the benefit and
advantage of, and covenants not to assert against the Agent or the Lenders,
any valuation, stay, appraisement, extension, redemption or similar laws
now or hereafter existing which, but for this provision, might be
applicable to the sale of any Credit Security made under the judgment,
order or decree of any court, or privately under the power of sale
conferred by this Agreement, or otherwise. Without limiting the generality
of the foregoing, each of the Obligors (a) agrees that it will not invoke
or utilize any law which might prevent, cause a delay in or otherwise
impede the enforcement of the rights of the Agent or any Lender in the
Credit Security, (b) waives all such laws, and (c) agrees that it will not
invoke or raise as a defense to any enforcement by the Agent or any Lender
of any rights and remedies relating to the Credit Security or the Credit
Obligations any legal or contractual requirement with which the Agent or
any Lender may have in good faith failed to comply. In addition, each of
the Obligors waives any right to prior notice (except to the extent
expressly required by this Agreement) or judicial hearing in connection
with foreclosure on or disposition of any Credit Security, including any
such right which such Obligor would otherwise have under the Constitution
of the United States of America, any state or territory thereof or any
other jurisdiction.
100
10.5.4. Sales of Credit Security. All or any part of the Credit
------------------------
Security may be sold for cash or other value in any number of lots at
public or private sale, without demand, advertisement or notice; provided,
--------
however, that unless the Credit Security to be sold threatens to decline
-------
speedily in value or is of a type customarily sold on a recognized market,
the Agent shall give the Obligor granting the security interest in such
Credit Security ten days' prior written notice of the time and place of any
public sale, or the time after which a private sale may be made, which
notice each of the Obligors and the Lenders hereby agrees to be reasonable.
At any sale or sales of Credit Security, any Lender or any of its
respective officers acting on its behalf, or such Lender's assigns, may bid
for and purchase all or any part of the property and rights so sold, may
use all or any portion of the Credit Obligations owed to such Lender as
payment for the property or rights so purchased, and upon compliance with
the terms of such sale may hold and dispose of such property and rights
without further accountability to the respective Obligor, except for the
proceeds of such sale or sales pursuant to Section 10.5.6. The Obligors
acknowledge that any such sale will be made by the Agent on an "as is"
basis with disclaimers of all warranties, whether express or implied. The
respective Obligors will execute and deliver or cause to be executed and
delivered such instruments, documents, assignments, waivers, certificates
and affidavits, will supply or cause to be supplied such further
information and will take such further action as the Agent shall request in
connection with any such sale.
10.5.5. Sale Without Registration. If, at any time when the Agent
-------------------------
shall determine to exercise its rights hereunder to sell all or part of the
securities included in the Credit Security, the securities in question
shall not be effectively registered under the Securities Act (or other
applicable law), the Agent may, in its sole discretion, sell such
securities by private or other sale not requiring such registration in such
manner and in such circumstances as the Agent may deem necessary or
advisable in order that such sale may be effected in accordance with
applicable securities laws without such registration and the related
delays, uncertainty and expense. Without limiting the generality of the
foregoing, in any event the Agent may, in its sole discretion, (a) approach
and negotiate with a single purchaser or one or more possible purchasers to
effect such sale, (b) restrict such sale to one or more purchasers each of
whom will represent and agree that such purchaser is purchasing for its own
account, for investment and not with a view to the distribution or sale of
such securities and (c) cause to be placed on certificates representing the
securities in question a legend to the effect that such securities have not
been registered under the Securities Act (or other applicable law) and may
not be disposed of in violation of the provisions thereof. Each of the
Obligors agrees that such manner of disposition is commercially reasonable,
that it will upon the Agent's request give any such purchaser access to
such information regarding the issuer of the securities in question as the
Agent may reasonably request and that the Agent and the Lenders shall not
incur any responsibility for selling all or part of the securities included
in the Credit Security at any private or other sale not requiring such
registration, notwithstanding the
101
possibility that a substantially higher price might be realized if the sale
were deferred until after registration under the Securities Act (or other
applicable law) or until made in compliance with certain other rules or
exemptions from the registration provisions under the Securities Act (or
other applicable law). Each of the Obligors acknowledges that no adequate
remedy at law exists for breach by it of this Section 10.5.5 and that such
breach would not be adequately compensable in damages and therefore agrees
that this Section 10.5.5 may be specifically enforced.
10.5.6. Application of Proceeds. The proceeds of all sales and
-----------------------
collections in respect of any Credit Security or other assets of any
Obligor, all funds collected from the Obligors and any cash contained in
the Credit Security, the application of which is not otherwise specifically
provided for herein, shall be applied as follows:
First, to the payment of the costs and expenses of such sales and
collections, the reasonable expenses of the Agent and the reasonable fees
and expenses of its special counsel;
Second, any surplus then remaining to the payment of the Credit
Obligations (other than in respect of Interest Rate Protection Agreements)
in such order and manner as the Agent may in its sole discretion determine;
provided, however, that any such payment of Credit Obligations owed to all
-------- -------
Lenders shall be pro rata in accordance with the respective Percentage
Interests of the Lenders;
Third, any surplus then remaining to the payment of the Credit
Obligations in respect of Interest Rate Protection Agreements with any
Lender in such order and manner as the Agent may in its sole discretion
determine; and
Fourth, any surplus then remaining shall be paid to the Obligors,
subject, however, to the rights of the holder of any then existing Lien of
which the Agent has actual notice.
10.6. Custody of Credit Security. Except as provided by applicable
--------------------------
law that cannot be waived, the Agent will have no duty as to the custody and
protection of the Credit Security, the collection of any part thereof or of any
income thereon or the preservation or exercise of any rights pertaining thereto,
including rights against prior parties, except for the use of reasonable care in
the custody and physical preservation of any Credit Security in its possession.
The Lenders will not be liable or responsible for any loss or damage to any
Credit Security, or for any diminution in the value thereof, by reason of the
act or omission of any agent selected by the Agent acting in good faith.
11. Expenses; Indemnity.
-------------------
11.1. Expenses. Whether or not the transactions contemplated hereby shall
--------
be consummated, the Company will pay:
102
(a) all reasonable expenses of the Agent (including the out-of-
pocket expenses related to forming the group of Lenders and reasonable fees
and disbursements of the counsel to the Agent) incurred on and prior to the
Restatement Date in connection with the preparation and duplication of this
Agreement and each other Credit Document, or in connection with any
environmental audit or review reports or examinations by and reports of the
Agent's commercial financial examiners (which expenses are estimated not to
exceed $100,000, any increase of such estimate to require the consent, not
to be unreasonably withheld, of the Company);
(b) all reasonable expenses of the Agent (including the reasonable
fees and disbursements of counsel to the Agent) in connection with
amendments, waivers, consents and other operations under this Agreement or
the Credit Documents;
(c) all recording and filing fees and transfer and documentary stamp
and similar taxes at any time payable in respect of this Agreement, any
other Credit Document, any Credit Security or the incurrence of the Credit
Obligations; and
(d) all other reasonable expenses incurred by the Lenders or the
holder of any Credit Obligation in connection with the enforcement of any
rights hereunder or under any other Credit Document, including costs of
collection and reasonable attorneys' fees (including a reasonable allowance
for the hourly cost of attorneys employed by the Lenders on a salaried
basis) and expenses.
11.2. General Indemnity. The Company shall indemnify the Lenders and
-----------------
the Agent and hold them harmless from any liability, loss or damage resulting
from the violation by the Company of Section 2.5. In addition, the Company
shall indemnify each Lender, the Agent, each of the Lenders' or the Agent's
directors, officers and employees, and each Person, if any, who controls any
Lender or the Agent (each Lender, the Agent and each of such directors,
officers, employees and control Persons is referred to as an "Indemnified
-----------
Party") and hold each of them harmless from and against any and all claims,
-----
damages, liabilities, losses and reasonable expenses (including reasonable fees
and disbursements of counsel with whom any Indemnified Party may consult in
connection therewith and all reasonable expenses of litigation or preparation
therefor) which any Indemnified Party may incur or which may be asserted against
any Indemnified Party in connection with (a) the Indemnified Party's compliance
with or contest of any subpoena or other process issued against it in any
proceeding involving the Company or any of its Subsidiaries or their Affiliates,
(b) any litigation or investigation involving the Company, any of its
Subsidiaries or their Affiliates, or any officer, director or employee thereof,
(c) the existence or exercise of any security rights with respect to the Credit
Security in accordance with the Credit Documents, or (d) this Agreement, any
other Credit Document or any transaction contemplated hereby or thereby;
provided, however, that the foregoing indemnity shall not apply to litigation
-------- -------
commenced by the
103
Company against the Lenders or the Agent which seeks enforcement of any of the
rights of the Company hereunder or under any other Credit Document and is
determined adversely to the Lenders or the Agent in a final nonappealable
judgment or to the extent such claims, damages, liabilities and expenses result
from a Lender's or the Agent's gross negligence or willful misconduct.
11.3. Indemnity With Respect to Letters of Credit. The Company shall
-------------------------------------------
indemnify each Letter of Credit Issuer and its correspondents and hold each of
them harmless from and against any and all claims, losses, liabilities, damages
and reasonable expenses (including reasonable attorneys' fees) arising from or
in connection with any Letter of Credit, including any such claim, loss,
liability, damage or expense arising out of any transfer, sale, delivery,
surrender or endorsement of any invoice, ▇▇▇▇ of lading, warehouse receipt or
other document at any time held by the Agent, any other Letter of Credit Issuer
or held for their respective accounts by any of their correspondents, in
connection with any Letter of Credit, except to the extent such claims, losses,
liabilities, damages and expenses result from gross negligence or willful
misconduct on the part of the Agent or any other Letter of Credit Issuer.
12. Operations; Agent.
-----------------
12.1. Interests in Credits. The Percentage Interest of each Lender in
--------------------
the Loan and the Letters of Credit, and the related Commitments, shall be
computed based on the maximum principal amount for each Lender as set forth in
the Register, as from time to time in effect. The current Percentage Interests
are set forth in Exhibit 12.1, which may be updated by the Agent from time to
time to conform to the Register.
12.2. Agent's Authority to Act, etc. Each of the Lenders appoints and
-----------------------------
authorizes BankBoston to act for the Lenders as the Lenders' Agent in connection
with the transactions contemplated by this Agreement and the other Credit
Documents on the terms set forth herein. In acting hereunder, the Agent is
acting for the account of BankBoston to the extent of its Percentage Interest
and for the account of each other Lender to the extent of the Lenders'
respective Percentage Interests, and all action in connection with the
enforcement of, or the exercise of any remedies (other than the Lenders' rights
of set-off as provided in Section 8.2.4 or in any Credit Document) in respect of
the Credit Obligations and Credit Documents shall be taken by the Agent.
12.3. Company to Pay Agent, etc. The Company and each Guarantor shall
-------------------------
be fully protected in making all payments in respect of the Credit Obligations
to the Agent, in relying upon consents, modifications and amendments executed by
the Agent purportedly on the Lenders' behalf, and in dealing with the Agent as
herein provided. The Agent may charge the accounts of the Company, on the dates
when the amounts thereof become due and payable, with the amounts of the
principal of and interest on the Loan, any amounts paid by the Letter of Credit
Issuers to third parties under Letters of Credit or drafts presented thereunder,
facility fees, Letter of Credit fees and all other fees and amounts owing under
any Credit Document.
104
12.4. Lender Operations for Advances, Letters of Credit, etc.
------------------------------------------------------
12.4.1. Advances. On each Closing Date, each Lender shall advance
--------
to the Agent in immediately available funds such Lender's Revolving Loan
Percentage Interest or Term Loan Percentage Interest, as the case may be,
in the portion of the Revolving Loan or the Term Loan, respectively,
advanced on such Closing Date prior to 3:30 p.m. (Boston time). If such
funds are not received at such time, but all applicable conditions set
forth in Section 5 have been satisfied, each Lender authorizes and requests
the Agent to advance for the Lender's account, pursuant to the terms
hereof, the Lender's respective Revolving Loan Percentage Interest or Term
Loan Percentage Interest, as the case may be, in such portion of the Loan
and agrees to reimburse the Agent in immediately available funds for the
amount thereof prior to 4:30 p.m. (Boston time) on the day any portion of
the Loan is advanced hereunder; provided, however, that the Agent is not
-------- -------
authorized to make any such advance for the account of any Lender who has
previously notified the Agent in writing that such Lender will not be
performing its obligations to make further advances hereunder; and
provided, further, that the Agent shall be under no obligation to make any
-------- -------
such advance.
12.4.2. Letters of Credit. Each of the Lenders authorizes and
-----------------
requests each Letter of Credit Issuer to issue the Letters of Credit
provided for in Section 2.4 and to grant each Lender a participation in
each of such Letters of Credit in an amount equal to its Revolving Loan
Percentage Interest in the amount of each such Letter of Credit. Promptly
upon the request of the Letter of Credit Issuer, each Lender shall
reimburse the Letter of Credit Issuer in immediately available funds for
such Lender's Revolving Loan Percentage Interest in the amount of all
obligations to third parties incurred by the Letter of Credit Issuer in
respect of each Letter of Credit and each draft accepted under a Letter of
Credit to the extent not reimbursed by the Company. The Letter of Credit
Issuer will notify each Lender of the issuance of any Letter of Credit, the
amount and date of payment of any draft drawn or accepted under a Letter of
Credit and whether in connection with the payment of any such draft the
amount thereof was added to the Revolving Loan or was reimbursed by the
Company.
12.4.3. Agent to Allocate Payments, etc. All payments of
--------------------------------
principal and interest in respect of the extensions of credit made pursuant
to this Agreement, reimbursement of amounts paid by any Letter of Credit
Issuer to third parties under Letters of Credit or drafts presented
thereunder, facility fees, Letter of Credit fees and other fees under this
Agreement shall, as a matter of convenience, be made by the Company and the
Guarantors to the Agent in immediately available funds. The share of each
Lender shall be credited to such Lender by the Agent in immediately
available funds in such manner that the principal amount of the Credit
Obligations to be paid shall be paid proportionately in accordance with the
Lenders' respective Revolving Loan Percentage Interests or Term Loan
Percentage Interests, as applicable, in such Credit Obligations, except as
otherwise provided in this Agreement. Under no circumstances shall any
Lender
105
be required to produce or present its Notes as evidence of its interests in
the Credit Obligations in any action or proceeding relating to the Credit
Obligations.
12.4.4. Delinquent Lenders; Nonperforming Lenders. In the event
-----------------------------------------
that any Lender fails to reimburse the Agent pursuant to Section 12.4.1 for
the Revolving Loan Percentage Interest or Term Loan Percentage Interest of
such lender (a "Delinquent Lender") in any credit advanced by the Agent
-----------------
pursuant hereto, overdue amounts (the "Delinquent Payment") due from the
------------------
Delinquent Lender to the Agent shall bear interest, payable by the
Delinquent Lender on demand, at a per annum rate equal to (a) the Federal
Funds Rate for the first three days overdue and (b) the sum of 2% plus the
----
Federal Funds Rate for any longer period. Such interest shall be payable
to the Agent for its own account for the period commencing on the date of
the Delinquent Payment and ending on the date the Delinquent Lender
reimburses the Agent on account of the Delinquent Payment (to the extent
not paid by the Company as provided below) and the accrued interest thereon
(the "Delinquency Period"), whether pursuant to the assignments referred to
------------------
below or otherwise. Upon notice by the Agent, the Company will pay to the
Agent the principal (but not the interest) portion of the Delinquent
Payment. During the Delinquency Period, in order to make reimbursements
for the Delinquent Payment and accrued interest thereon, the Delinquent
Lender shall be deemed to have assigned to the Agent all interest, facility
fees and other payments made by the Company under Section 3 that would have
thereafter otherwise been payable under the Credit Documents to the
Delinquent Lender. During any other period in which any Lender is not
performing its obligations to extend credit under Section 2 (a
"Nonperforming Lender"), the Nonperforming Lender shall be deemed to have
---------------------
assigned to each Lender that is not a Nonperforming Lender (a "Performing
----------
Lender") all principal and other payments made by the Company under Section
------
4 that would have thereafter otherwise been payable under the Credit
Documents to the Nonperforming Lender. The Agent shall credit a portion of
such payments to each Performing Lender in an amount equal to the Revolving
Loan Percentage Interest or Term Loan Percentage Interest, as applicable,
of such Performing Lender in an amount equal to the Revolving Loan
Percentage Interest or Term Loan Percentage Interest of such Performing
Lender divided by one minus the Revolving Loan Percentage Interest or Term
-----
Loan Percentage Interest of the Nonperforming Lender until the respective
portions of the Revolving Loan or the Term Loan, as applicable, owed to all
the Lenders are the same as the Revolving Loan Percentage Interest or Term
Loan Percentage Interests, respectively, of the Lenders immediately prior
to the failure of the Nonperforming Lender to perform its obligations under
Section 2. The foregoing provisions shall be in addition to any other
remedies the Agent, the Performing Lenders or the Company may have under
law or equity against the Delinquent Lender as a result of the Delinquent
Payment or against the Nonperforming Lender as a result of its failure to
perform its obligations under Section 2.
106
12.5. Sharing of Payments, etc. Each Lender agrees that (a) if by
-------------------------
exercising any right of set-off or counterclaim or otherwise, it shall receive
payment of (i) a proportion of the aggregate amount due with respect to its
Percentage Interest in the Loan and Letter of Credit Exposure which is greater
than (ii) the proportion received by any other Lender in respect of the
aggregate amount due with respect to such other Lender's Percentage Interest in
the Loan and Letter of Credit Exposure and (b) if such inequality shall continue
for more than 10 days, the Lender receiving such proportionately greater payment
shall purchase participations in the Percentage Interests in the Loan and Letter
of Credit Exposure held by the other Lenders, and such other adjustments shall
be made from time to time (including rescission of such purchases of
participations in the event the unequal payment originally received is recovered
from such Lender through bankruptcy proceedings or otherwise), as may be
required so that all such payments of principal and interest with respect to the
Loan and Letter of Credit Exposure held by the Lenders shall be shared by the
Lenders pro rata in accordance with their respective Percentage Interests;
provided, however, that this Section 12.5 shall not impair the right of any
-------- -------
Lender to exercise any right of set-off or counterclaim it may have and to apply
the amount subject to such exercise to the payment of Indebtedness of any
Obligor other than such Obligor's Indebtedness with respect to the Loan and
Letter of Credit Exposure; provided, further, that such application may be
-------- -------
affected by Section 4.05 of the Intercreditor Agreement. Each Lender that
grants a participation in the Credit Obligations to a Credit Participant shall
require as a condition to the granting of such participation that such Credit
Participant agree to share payments received in respect of the Credit
Obligations as provided in this Section 12.5. The provisions of this Section
12.5 are for the sole and exclusive benefit of the Lenders and no failure of any
Lender to comply with the terms hereof shall be available to any Obligor as a
defense to the payment of the Credit Obligations.
12.6. Amendments, Consents, Waivers, etc. Except as otherwise set forth
----------------------------------
herein, the Agent may (and upon the written request of the Required Lenders the
Agent shall) take or refrain from taking any action under this Agreement or any
other Credit Document, including giving its written consent to any modification
of or amendment to and waiving in writing compliance with any covenant or
condition in this Agreement or any other Credit Document (other than an Interest
Rate Protection Agreement) or any Default or Event of Default, all of which
actions shall be binding upon all of the Lenders; provided, however, that:
-------- -------
(a) Except as provided below, without the written consent of the
Required Lenders, no written modification of, amendment to, consent with
respect to, waiver of compliance with or waiver of a Default under, any of
the Credit Documents (other than an Interest Rate Protection Agreement)
shall be made.
(b) Without the written consent of such Lenders as own 100% of the
Percentage Interests (other than Delinquent Lenders during the existence of
a Delinquency Period so long as such Delinquent Lender is treated the same
as the other Lenders with respect to any actions enumerated below):
107
(i) No reduction shall be made in (A) the amount of principal
of the Loan or reimbursement obligations for payments made under
Letters of Credit, (B) the interest rate on the Loan or (C) the Letter
of Credit fees (except those owed solely to the Letter of Credit
Issuer, which may be reduced by agreement solely between the Company
and the Letter of Credit Issuer) or facility fees.
(ii) No change shall be made in the stated time of payment of
all or any portion of the Loan or interest thereon or reimbursement of
payments made under Letters of Credit or fees relating to any of the
foregoing payable to all of the Lenders and no waiver shall be made of
any Default under Section 8.1.1.
(iii) No alteration shall be made of the Lenders' rights of set-
off contained in Section 8.2.4.
(iv) No release of any Credit Security or of any Guarantor
shall be made (except that the Agent may release particular items of
Credit Security or particular Guarantors in dispositions permitted by
Section 6.11 and may release all Credit Security pursuant to Section
18 upon payment in full of the Credit Obligations and termination of
the Commitments without the written consent of the Lenders).
(v) No amendment to or modification of this Section 12.6(b) or
of Section 12.6(c) shall be made.
(c) No increase shall be made in the amount of any Commitment of any
Lender, and no extension shall be made of the term of any Commitment of any
Lender, unless such increase or extension, respectively, shall have
received the prior written consent of such Lender.
12.7. Agent's Resignation. The Agent may resign at any time by giving at
-------------------
least 60 days' prior written notice of its intention to do so to each other of
the Lenders and the Company and upon the appointment by the Required Lenders of
a successor Agent satisfactory to the Company. If no successor Agent shall have
been so appointed and shall have accepted such appointment within 45 days after
the retiring Agent's giving of such notice of resignation, then the retiring
Agent may with the consent of the Company, which shall not be unreasonably
withheld, appoint a successor Agent which shall be a bank or a trust company
organized under the laws of the United States of America or any state thereof
and having a combined capital, surplus and undivided profit of at least
$100,000,000; provided, however, that any successor Agent appointed under this
-------- -------
sentence may be removed upon the written request of the Required Lenders, which
request shall also appoint a successor Agent satisfactory to the Company. Upon
the appointment of a new Agent hereunder, the term "Agent" shall for all
purposes of this Agreement thereafter mean such successor. After any retiring
Agent's resignation hereunder as Agent, or the removal hereunder of any
successor Agent, the provisions of
108
this Agreement shall continue to inure to the benefit of such Agent as to any
actions taken or omitted to be taken by it while it was Agent under this
Agreement.
12.8. Concerning the Agent.
--------------------
12.8.1. Action in Good Faith, etc. The Agent and its officers,
-------------------------
directors, employees and agents shall be under no liability to any of the
Lenders or to any future holder of any interest in the Credit Obligations
for any action or failure to act taken or suffered in good faith, and any
action or failure to act in accordance with an opinion of its counsel shall
conclusively be deemed to be in good faith. The Agent shall in all cases
be entitled to rely, and shall be fully protected in relying, on
instructions given to the Agent by the required holders of Credit
Obligations as provided in this Agreement.
12.8.2. No Implied Duties, etc. The Agent shall have and may
----------------------
exercise such powers as are specifically delegated to the Agent under this
Agreement or any other Credit Document together with all other powers
incidental thereto. The Agent shall have no implied duties to any Person
or any obligation to take any action under this Agreement or any other
Credit Document except for action specifically provided for in this
Agreement or any other Credit Document to be taken by the Agent. Before
taking any action under this Agreement or any other Credit Document, the
Agent may request an appropriate specific indemnity satisfactory to it from
each Lender in addition to the general indemnity provided for in Section
12.11. Until the Agent has received such specific indemnity, the Agent
shall not be obligated to take (although it may in its sole discretion
take) any such action under this Agreement or any other Credit Document.
Each Lender confirms that the Agent does not have a fiduciary relationship
to it under the Credit Documents. Each of the Company and its Subsidiaries
party hereto confirms that neither the Agent nor any other Lender has a
fiduciary relationship to it under the Credit Documents.
12.8.3. Validity, etc. The Agent shall not be responsible to any
-------------
Lender or any future holder of any interest in the Credit Obligations (a)
for the legality, validity, enforceability or effectiveness of this
Agreement or any other Credit Document, (b) for any recitals, reports,
representations, warranties or statements contained in or made in
connection with this Agreement or any other Credit Document, (c) for the
existence or value of any assets included in any security for the Credit
Obligations, (d) for the effectiveness of any Lien purported to be included
in the Credit Security, (e) for the specification or failure to specify any
particular assets to be included in the Credit Security, or (f) unless the
Agent shall have failed to comply with Section 12.8.1, for the perfection
of the security interests in the Credit Security.
12.8.4. Compliance. The Agent shall not be obligated to ascertain
----------
or inquire as to the performance or observance of any of the terms of this
Agreement or any other Credit Document; and in connection with any
extension of credit
109
under this Agreement or any other Credit Document, the Agent shall be fully
protected in relying on a certificate of the Company as to the fulfillment
by the Company of any conditions to such extension of credit.
12.8.5. Employment of Agents and Counsel. The Agent may execute
--------------------------------
any of its duties as Agent under this Agreement or any other Credit
Document by or through employees, agents and attorneys-in-fact and shall
not be responsible to any of the Lenders, the Company or any other Obligor
for the default or misconduct of any such agents or attorneys-in-fact
selected by the Agent acting in good faith. The Agent shall be entitled to
advice of counsel concerning all matters pertaining to the agency hereby
created and its duties hereunder or under any other Credit Document.
12.8.6. Reliance on Documents and Counsel. The Agent shall be
---------------------------------
entitled to rely, and shall be fully protected in relying, upon any
affidavit, certificate, cablegram, consent, instrument, letter, notice,
order, document, statement, telecopy, telegram, telex or teletype message
or writing reasonably believed in good faith by the Agent to be genuine and
correct and to have been signed, sent or made by the Person in question,
including any telephonic or oral statement made by such Person, and, with
respect to legal matters, upon an opinion or the advice of counsel selected
by the Agent.
12.8.7. Agent's Reimbursement. Each of the Lenders severally
---------------------
agrees to reimburse the Agent, in the amount of such Lender's Percentage
Interest, for any reasonable expenses not reimbursed by the Company or the
Guarantors (without limiting the obligation of the Company or the
Guarantors to make such reimbursement): (a) for which the Agent is
entitled to reimbursement by the Company or the Guarantors under this
Agreement or any other Credit Document, and (b) after the occurrence of a
Default, for any other reasonable expenses incurred by the Agent on the
Lenders' behalf in connection with the enforcement of the Lenders' rights
under this Agreement or any other Credit Document.
12.8.8. Agent's Fees. The Company shall pay to the Agent for its
------------
own account an agent's fee in the amounts separately agreed to from time to
time by the Company and the Agent.
12.9. Rights as a Lender. With respect to any credit extended by it
------------------
hereunder, BankBoston shall have the same rights, obligations and powers
hereunder as any other Lender and may exercise such rights and powers as though
it were not the Agent, and unless the context otherwise specifies, BankBoston
shall be treated in its individual capacity as though it were not the Agent
hereunder. Without limiting the generality of the foregoing, the Percentage
Interest of BankBoston shall be included in any computations of Percentage
Interests. BankBoston and its Affiliates may accept deposits from, lend money
to, act as trustee for and generally engage in any kind of banking or trust
business with the Company, any of its Subsidiaries or any Affiliate of any of
them and any Person who may do business with or own an equity interest in the
Company, any
110
of its Subsidiaries or any Affiliate of any of them, all as if BankBoston were
not the Agent and without any duty to account therefor to the other Lenders.
12.10. Independent Credit Decision. Each of the Lenders acknowledges
---------------------------
that it has independently and without reliance upon the Agent, based on the
financial statements and other documents referred to in Section 7.2, on the
other representations and warranties contained herein and on such other
information with respect to the Company and its Subsidiaries as such Lender
deemed appropriate, made such Lender's own credit analysis and decision to enter
into this Agreement and to make the extensions of credit provided for hereunder.
Each Lender represents to the Agent that such Lender will continue to make its
own independent credit and other decisions in taking or not taking action under
this Agreement or any other Credit Document. Each Lender expressly acknowledges
that neither the Agent nor any of its officers, directors, employees, agents,
attorneys-in-fact or Affiliates has made any representations or warranties to
such Lender, and no act by the Agent taken under this Agreement or any other
Credit Document, including any review of the affairs of the Company and its
Subsidiaries, shall be deemed to constitute any representation or warranty by
the Agent. Except for notices, reports and other documents expressly required
to be furnished to each Lender by the Agent under this Agreement or any other
Credit Document, the Agent shall not have any duty or responsibility to provide
any Lender with any credit or other information concerning the business,
operations, property, condition, financial or otherwise, or creditworthiness of
the Company or any Subsidiary which may come into the possession of the Agent or
any of its officers, directors, employees, agents, attorneys-in-fact or
Affiliates.
12.11. Indemnification. The holders of the Credit Obligations shall
---------------
indemnify the Agent and its officers, directors, employees and agents (to the
extent not reimbursed by the Obligors and without limiting the obligation of any
of the Obligors to do so), pro rata in accordance with their respective
Percentage Interests, from and against any and all liabilities, obligations,
losses, damages, penalties, actions, judgments, suits, costs, expenses or
disbursements of any kind whatsoever which may at any time be imposed on,
incurred by or asserted against the Agent or such Persons relating to or arising
out of this Agreement, any other Credit Document, the transactions contemplated
hereby or thereby, or any action taken or omitted by the Agent in connection
with any of the foregoing; provided, however, that the foregoing shall not
-------- -------
extend to actions or omissions which are taken by the Agent with gross
negligence or willful misconduct.
13. Successors and Assigns; Lender Assignments and Participations. Any
-------------------------------------------------------------
reference in this Agreement to any of the parties hereto shall be deemed to
include the successors and assigns of such party, and all covenants and
agreements by or on behalf of the Company, the Guarantors, the Agent or the
Lenders that are contained in this Agreement or any other Credit Documents shall
bind and inure to the benefit of their respective successors and assigns;
provided, however, that (a) the Company and its Subsidiaries may not assign
-------- -------
their rights or obligations under this Agreement except for mergers or
liquidations permitted by Section 6.11, and (b) the Lenders shall be not
entitled to assign their respective Percentage Interests in the Loan hereunder
except as set forth below in this Section 13.
111
13.1. Assignments by Lenders.
----------------------
13.1.1. Assignees and Assignment Procedures. Each Lender may (a)
-----------------------------------
without the consent of the Agent or the Company if the proposed assignee is
already a Lender hereunder or a Wholly Owned Subsidiary of the same
corporate parent of which the assigning Lender is a Subsidiary, or (b)
otherwise with the consents of the Agent and (so long as no Event of
Default exists) the Company (which consents will not be unreasonably
withheld), in compliance with applicable laws in connection with such
assignment, assign to one or more Eligible Assignees (each, an "Assignee")
--------
all or a portion of its interests, rights and obligations under this
Agreement and the other Credit Documents, including all or a portion, which
need not be pro rata between the Loan and the Letter of Credit Exposure, of
its Commitment, the portion of the Loan and Letter of Credit Exposure at
the time owing to it and the Notes held by it, but excluding its rights and
obligations as a Letter of Credit Issuer; provided, however, that:
-------- -------
(i) the aggregate amount of the Commitment of the assigning
Lender subject to each such assignment to any Assignee other than
another Lender (determined as of the date the Assignment and
Acceptance with respect to such assignment is delivered to the Agent)
shall be not less than $5,000,000 and in increments of $1,000,000;
and
(ii) the parties to each such assignment shall execute and
deliver to the Agent an Assignment and Acceptance (the "Assignment
----------
and Acceptance") substantially in the form of Exhibit 13.1.1,
--------------
together with the Note subject to such assignment and a processing
and recordation fee of $3,000 payable to the Agent by the assigning
Lender.
Upon acceptance and recording pursuant to Section 13.1.4, from and after
the effective date specified in each Assignment and Acceptance (which
effective date shall be at least five Banking Days after the execution
thereof unless waived by the Agent):
(1) the Assignee shall be a party hereto and, to the extent provided
in such Assignment and Acceptance, have the rights and
obligations of a Lender under this Agreement and
(2) the assigning Lender shall, to the extent provided in such
assignment, be released from its obligations under this Agreement
(and, in the case of an Assignment and Acceptance covering all or
the remaining portion of an assigning Lender's rights and
obligations under this Agreement, such Lender shall cease to be a
party hereto but shall continue to be entitled to the benefits of
Sections 3.2.4, 3.5, 3.6, 3.7, 3.8 and 11, as well as to any fees
accrued for its account hereunder and not yet paid).
112
13.1.1A. Assignment Among Lenders. Notwithstanding the provisions
------------------------
of Section 13.1.1, in the event that the debt obligations of any Lender
shall be rated less than "A3" by ▇▇▇▇▇'▇ or less than "A-" by S&P, each
other Lender party hereto or any two or more of them acting together shall
be entitled on ten Business Days' prior written notice to the Agent, the
Company, and such Lender to purchase the interest of such Lender hereunder,
in whole and not in part, at a purchase price equal to the outstanding
principal amount of such Lender's Percentage Interest in the Loans advanced
hereunder and its share of Letter of Credit Exposure plus accrued and
unpaid interest thereon to the purchase date, together with any fees or
other amounts that may be owing to such Lender hereunder, including without
limitation additional interest with respect to such Lender's Percentage
Interest in any Eurodollar Rate Loan calculated as provided in Section
3.2.4. Such transfer shall be effected by the execution and delivery of an
Assignment and Acceptance.
13.1.2. Terms of Assignment and Acceptance. By executing and
----------------------------------
delivering an Assignment and Acceptance, the assigning Lender and Assignee
shall be deemed to confirm to and agree with each other and the other
parties hereto as follows:
(a) other than the representation and warranty that it is the legal
and beneficial owner of the interest being assigned thereby free and clear
of any adverse claim, such assigning Lender makes no representation or
warranty and assumes no responsibility with respect to any statements,
warranties or representations made in or in connection with this Agreement
or the execution, legality, validity, enforceability, genuineness,
sufficiency or value of this Agreement, any other Credit Document or any
other instrument or document furnished pursuant hereto;
(b) such assigning Lender makes no representation or warranty and
assumes no responsibility with respect to the financial condition of the
Company and its Subsidiaries or the performance or observance by the
Company or any of its Subsidiaries of any of its obligations under this
Agreement, any other Credit Document or any other instrument or document
furnished pursuant hereto;
(c) such Assignee confirms that it has received a copy of this
Agreement, together with copies of the most recent financial statements
delivered pursuant to Section 7.2 or Section 6.4 and such other documents
and information as it has deemed appropriate to make its own credit
analysis and decision to enter into such Assignment and Acceptance;
(d) such Assignee will independently and without reliance upon the
Agent, such assigning Lender or any other Lender, 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;
113
(e) such Assignee appoints and authorizes the Agent to take such
action as agent on its behalf and to exercise such powers under this
Agreement as are delegated to the Agent by the terms hereof, together with
such powers as are reasonably incidental thereto; and
(f) such Assignee agrees that it will perform in accordance with the
terms of this Agreement all the obligations which are required to be
performed by it as a Lender.
13.1.3. Register. The Agent shall maintain at the Boston Office a
--------
register (the "Register") for the recordation of (a) the names and
--------
addresses of the Lenders and the Assignees which assume rights and
obligations pursuant to an assignment under Section 13.1.1, (b) the
Percentage Interest of each such Lender as set forth in Section 12.1 and
(c) the amount of the Loan and Letter of Credit Exposure owing to each
Lender from time to time. The entries in the Register shall be conclusive,
in the absence of demonstrable error, and the Company, the Agent and the
Lenders may treat each Person whose name is registered therein for all
purposes as a party to this Agreement. The Register shall be available for
inspection by the Company or any Lender at any reasonable time and from
time to time upon reasonable prior notice.
13.1.4. Acceptance of Assignment and Assumption. Upon its receipt
---------------------------------------
of a completed Assignment and Acceptance executed by an assigning Lender
and an Assignee together with the Note subject to such assignment, and the
processing and recordation fee referred to in Section 13.1.1, the Agent
shall (a) accept such Assignment and Acceptance, (b) record the information
contained therein in the Register and (c) give prompt notice thereof to the
Company. Within five Banking Days after receipt of notice, the Company, at
its own expense, shall execute and deliver to the Agent, in exchange for
the surrendered Note, a new Note to the order of such Assignee in a
principal amount equal to the applicable Commitment and Loan assumed by it
pursuant to such Assignment and Acceptance and, if the assigning Lender has
retained a Commitment and Loan, a new Note to the order of such assigning
Lender in a principal amount equal to the applicable Commitment and Loan
retained by it. Such new Note shall be in an aggregate principal amount
equal to the aggregate principal amount of such surrendered Note, and shall
be dated the date of the surrendered Note which it replaces.
13.1.5. Federal Reserve Bank. Notwithstanding the foregoing
--------------------
provisions of this Section 13, any Lender may at any time pledge or assign
all or any portion of such Lender's rights under this Agreement and the
other Credit Documents to a Federal Reserve Bank; provided, however, that
-------- -------
no such pledge or assignment shall release such Lender from such Lender's
obligations hereunder or under any other Credit Document.
114
13.1.6. Further Assurances. The Company and its Subsidiaries
------------------
shall sign such documents and take such other actions from time to time
reasonably requested by an Assignee to enable it to share in the benefits
of the rights created by the Credit Documents.
13.2. Credit Participants. Each Lender may, (a) without the consent
-------------------
of the Company or the Agent if the proposed participant is already a Lender or a
Credit Participant hereunder or a Wholly Owned Subsidiary of the same corporate
parent of which the Lender is a Subsidiary or (b) otherwise with the consents of
the Agent and (so long as no Event of Default exists) the Company (which
consents will not be unreasonably withheld), in compliance with applicable laws
in connection with such participation, sell to one or more commercial banks or
other financial institutions (each a "Credit Participant") participations in all
------------------
or a portion of its interests, rights and obligations under this Agreement and
the other Credit Documents (including all or a portion of its Commitment, the
Loan and Letter of Credit Exposure owing to it and the Note held by it);
provided, however, that:
-------- -------
(a) such Lender's obligations under this Agreement shall remain
unchanged;
(b) such Lender shall remain solely responsible to the other
parties hereto for the performance of such obligations;
(c) the Credit Participant shall be entitled to the benefit of the
cost protection provisions contained in Sections 3.2.4, 3.5, 3.6, 3.7, 3.8
and 11, but shall not be entitled to receive any greater payment thereunder
than the selling Lender would have been entitled to receive with respect to
the interest so sold if such interest had not been sold; and
(d) the Company, the Agent and the other Lenders shall continue to
deal solely and directly with such Lender in connection with such Lender's
rights and obligations under this Agreement, and such Lender shall retain
the sole right as one of the Lenders to vote with respect to the
enforcement of the obligations of the Company relating to the Loan and
Letter of Credit Exposure and the approval of any amendment, modification
or waiver of any provision of this Agreement (other than amendments,
modifications, consents or waivers described in clause (b) of the proviso
to Section 12.6).
Each Obligor agrees, to the fullest extent permitted by applicable law, that any
Credit Participant and any Lender purchasing a participation from another Lender
pursuant to Section 12.5 may exercise all rights of payment (including the right
of set-off), with respect to its participation as fully as if such Credit
Participant or such Lender were the direct creditor of the Obligors and a Lender
hereunder in the amount of such participation.
115
13.3. Replacement of Lender. In the event that any Lender or, to the
---------------------
extent applicable, any Credit Participant (the "Affected Lender"):
---------------
(a) fails to perform its obligations to fund any portion of the
Loan or to issue any Letter of Credit on any Closing Date when required to
do so by the terms of the Credit Documents;
(b) demands payment under the Reserve provisions of Section 3.5,
the Tax provisions of Section 3.6, the capital adequacy provisions of
Section 3.7 or the regulatory change provisions in Section 3.8 in an amount
the Company deems materially in excess of the amounts with respect thereto
demanded by the other Lenders; or
(c) refuses to consent to a proposed amendment, modification,
waiver or other action requiring consent of the holders of 100% of the
Percentage Interests under Section 12.6(b) that is consented to by the
other Lenders;
then, so long as no Event of Default exists, the Company shall have the right to
seek a replacement lender which is reasonably satisfactory to the Agent (the
"Replacement Lender"). The Replacement Lender shall purchase the interests of
------------------
the Affected Lender in the Loan, Letters of Credit and its Commitment and shall
assume the obligations of the Affected Lender hereunder and under the other
Credit Documents upon execution by the Replacement Lender of an Assignment and
Acceptance and the tender by it to the Affected Lender of a purchase price
agreed between it and the Affected Lender (or, if they are unable to agree, a
purchase price in the amount of the Affected Lender's Percentage Interest in the
Loan and Letter of Credit Exposure, or appropriate credit support for contingent
amounts included therein, and all other outstanding Credit Obligations then owed
to the Affected Lender). Such assignment by the Affected Lender shall be deemed
an early termination of any Eurodollar Pricing Option to the extent of the
Affected Lender's portion thereof, and the Company will pay to the Affected
Lender any resulting amounts due under Section 3.2.4. Upon consummation of such
assignment, the Replacement Lender shall become party to this Agreement as a
signatory hereto and shall have all the rights and obligations of the Affected
Lender under this Agreement and the other Credit Documents with a Percentage
Interest equal to the Percentage Interest of the Affected Lender, the Affected
Lender shall be released from its obligations hereunder and under the other
Credit Documents, and no further consent or action by any party shall be
required. Upon the consummation of such assignment, the Company, the Agent and
the Affected Lender shall make appropriate arrangements so that a new Revolving
Note is issued to the Replacement Lender if it has acquired a portion of the
Revolving Loan. The Company and the Guarantors shall sign such documents and
take such other actions reasonably requested by the Replacement Lender to enable
it to share in the benefits of the rights created by the Credit Documents.
Until the consummation of an assignment in accordance with the foregoing
provisions of this Section 13.3, the Company shall continue to pay to the
Affected Lender any Credit Obligations as they become due and payable.
116
14. Confidentiality. Each Lender will make no disclosure of confidential
---------------
information furnished to it directly or indirectly by the Company or any of its
Subsidiaries unless such information shall have become public, except:
(a) in connection with operations under or the enforcement of this
Agreement or any other Credit Document;
(b) pursuant to any statutory or regulatory requirement or any
mandatory court order, subpoena or other legal process;
(c) to any parent or corporate Affiliate of such Lender or to any
Credit Participant, proposed Credit Participant or proposed Assignee;
provided, however, that any such Person shall agree to comply with the
-------- -------
restrictions set forth in this Section 14 with respect to such information;
(d) to its independent counsel, auditors and other professional
advisors with an instruction to such Person to keep such information
confidential; and
(e) with the prior written consent of the Company, to any other
Person.
15. Foreign Lenders. If any Lender is not incorporated or organized under
---------------
the laws of the United States of America or a state thereof, such Lender shall
deliver to the Company and the Agent the following:
(a) Two duly completed copies of United States Internal Revenue
Service Form 1001 or 4224 or successor form, as the case may be, certifying
in each case that such Person is entitled to receive payments under this
Agreement, the Notes and reimbursement obligations under Letters of Credit
payable to it, without deduction or withholding of any United States
federal income taxes; and
(b) A duly completed Internal Revenue Service Form W-8 or W-9 or
successor form, as the case may be, to establish an exemption from United
States backup withholding tax.
Each such Lender that delivers to the Company and the Agent a Form 1001 or
4224 and Form W-8 or W-9 pursuant to this Section 15 further undertakes to
deliver to the Company and the Agent two further copies of Form 1001 or 4224 and
Form W-8 or W-9, or successor applicable form, or other manner of certification,
as the case may be, on or before the date that any such form expires or becomes
obsolete or after the occurrence of any event requiring a change in the most
recent form previously delivered by it to the Company and the Agent. Such Forms
1001 or 4224 shall certify that such Lender is entitled to receive payments
under this Agreement without deduction or withholding of any United States
federal income taxes. The foregoing documents need not be delivered in the
event any change in treaty, law or regulation or official interpretation thereof
has occurred which renders all such forms inapplicable or which would prevent
such Lender from delivering any such form with respect to it, or such
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Lender advises the Company that it is not capable of receiving payments without
any deduction or withholding of United States federal income tax and, in the
case of a Form W-8 or W-9, establishing an exemption from United States backup
withholding tax. Until such time as the Company and the Agent have received such
forms indicating that payments hereunder are not subject to United States
withholding tax or are subject to such tax at a rate reduced by an applicable
tax treaty, the Company shall withhold taxes from such payments at the
applicable statutory rate without regard to Section 3.6.
16. Notices. Except as otherwise specified in this Agreement, any notice
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required to be given pursuant to this Agreement shall be given in writing. Any
notice, consent, approval, demand or other communication in connection with this
Agreement shall be deemed to be given if given in writing (including telex,
telecopy or similar teletransmission) addressed as provided below (or to the
addressee at such other address as the addressee shall have specified by notice
actually received by the addressor), and if actually delivered in fully legible
form to such address (evidenced in the case of a telex, telecopy or similar
teletransmission by receipt of the correct answerback).
If to the Company or any of its Subsidiaries, to it at its address set
forth in Exhibit 7.1 (as supplemented pursuant to Sections 6.4.1 and 6.4.2), to
the attention of the chief financial officer.
If to any Lender or the Agent, to it at its address set forth on the
signature pages of this Agreement or in the Register, with a copy to the Agent.
17. Course of Dealing; Amendments and Waivers . No course of dealing between
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any Lender or the Agent, on one hand, and the Company or any other Obligor, on
the other hand, shall operate as a waiver of any of the Lenders' or the Agent's
rights under this Agreement or any other Credit Document or with respect to the
Credit Obligations. Each of the Company and the Guarantors acknowledges that if
the Lenders or the Agent, without being required to do so by this Agreement or
any other Credit Document, give any notice or information to, or obtain any
consent from, the Company or any other Obligor, the Lenders and the Agent shall
not by implication have amended, waived or modified any provision of this
Agreement or any other Credit Document, or created any duty to give any such
notice or information or to obtain any such consent on any future occasion. No
delay or omission on the part of any Lender of the Agent in exercising any right
under this Agreement or any other Credit Document or with respect to the Credit
Obligations shall operate as a waiver of such right or any other right hereunder
or thereunder. A waiver on any one occasion shall not be construed as a bar to
or waiver of any right or remedy on any future occasion. No waiver, consent or
amendment with respect to this Agreement or any other Credit Document shall be
binding unless it is in writing and signed by the Agent or the Required Lenders.
18. Defeasance. When all Credit Obligations have been paid and all Letters
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of Credit terminated and returned to the Letter of Credit Issuer or cash
collateralized in a manner satisfactory to the Lenders, and if at the time no
Lender continues to be committed to extend any credit to the Company hereunder
or under any other Credit Document, this
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Agreement shall terminate and, at the Company's written request, accompanied by
such certificates and other items as the Agent shall reasonably deem necessary,
the Credit Security shall revert to the Obligors and the right, title and
interest of the Lenders therein shall terminate. Thereupon, on the Obligor's
demand and at their cost and expense, the Agent shall execute proper
instruments, acknowledging satisfaction of and discharging this Agreement, and
shall redeliver to the Obligors any Credit Security then in its possession;
provided, however, that Sections 3.2.4, 3.5, 3.6, 3.7, 3.8, 11, 12.8.7, 12.11,
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14, 19 and 20 shall survive the termination of this Agreement.
19. Venue; Service of Process. Each of the Company and the other Obligors:
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(a) Irrevocably submits to the nonexclusive jurisdiction of the state
courts of The Commonwealth of Massachusetts and to the nonexclusive
jurisdiction of the United States District Court for the District of
Massachusetts for the purpose of any suit, action or other proceeding
arising out of or based upon this Agreement or any other Credit Document or
the subject matter hereof or thereof.
(b) Waives to the extent not prohibited by applicable law that cannot
be waived, and agrees not to assert, by way of motion, as a defense or
otherwise, in any such proceeding brought in any of the above-named courts,
any claim that it is not subject personally to the jurisdiction of such
court, that its property is exempt or immune from attachment or execution,
that such proceeding is brought in an inconvenient forum, that the venue of
such proceeding is improper, or that this Agreement or any other Credit
Document, or the subject matter hereof or thereof, may not be enforced in
or by such court.
Each of the Company and the other Obligors consents to service of process in any
such proceeding in any manner at the time permitted by Chapter 223A of the
General Laws of The Commonwealth of Massachusetts and agrees that service of
process by registered or certified mail, return receipt requested, at its
address specified in or pursuant to Section 16 is reasonably calculated to give
actual notice.
20. WAIVER OF JURY TRIAL. TO THE EXTENT NOT PROHIBITED BY APPLICABLE LAW
--------------------
THAT CANNOT BE WAIVED, EACH OF THE COMPANY, THE OTHER OBLIGORS, THE AGENT AND
THE LENDERS WAIVES, AND COVENANTS THAT IT WILL NOT ASSERT (WHETHER AS PLAINTIFF,
DEFENDANT OR OTHERWISE), ANY RIGHT TO TRIAL BY JURY IN ANY FORUM IN RESPECT OF
ANY ISSUE, CLAIM OR PROCEEDING ARISING OUT OF THIS AGREEMENT OR ANY OTHER CREDIT
DOCUMENT OR THE SUBJECT MATTER HEREOF OR THEREOF OR ANY CREDIT OBLIGATION OR IN
ANY WAY CONNECTED WITH THE DEALINGS OF THE LENDERS, THE AGENT, THE COMPANY OR
ANY OTHER OBLIGOR IN CONNECTION WITH ANY OF THE ABOVE, IN EACH CASE WHETHER NOW
EXISTING OR HEREAFTER ARISING AND WHETHER IN CONTRACT, TORT OR OTHERWISE. Each
of the Company and the other Obligors acknowledges that it has been informed by
the Agent that the
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provisions of this Section 20 constitute a material inducement upon which each
of the Lenders has relied and will rely in entering into this Agreement and any
other Credit Document, and that it has reviewed the provisions of this Section
20 with its counsel. Any Lender, the Agent, the Company or any other Obligor may
file an original counterpart or a copy of this Section 20 with any court as
written evidence of the consent of the Company, the other Obligors, the Agent
and the Lenders to the waiver of their rights to trial by jury.
21. General. All covenants, agreements, representations and warranties made
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in this Agreement or any other Credit Document or in certificates delivered
pursuant hereto or thereto shall be deemed to have been relied on by each
Lender, notwithstanding any investigation made by any Lender on its behalf, and
shall survive the execution and delivery to the Lenders hereof and thereof. The
invalidity or unenforceability of any provision hereof shall not affect the
validity or enforceability of any other provision hereof. The headings in this
Agreement are for convenience of reference only and shall not limit or otherwise
affect the meaning hereof. This Agreement and the other Credit Documents
constitute the entire understanding of the parties with respect to the subject
matter hereof and thereof and supersede all prior and contemporaneous
understandings and agreements, whether written or oral; provided, however, that
the terms of the Commitment Letter dated October 8, 1998 among the Company,
BankBoston and BancBoston ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ Inc. shall survive with respect to
all provisions of such Commitment Letter and the term sheet attached thereto
which relate to the syndication of the Credit Obligations. This Agreement may be
executed in any number of counterparts which together shall constitute one
instrument. This Agreement shall be governed by and construed in accordance with
the laws (other than the conflict of laws rules) of The Commonwealth of
Massachusetts, except as may be required by the UCC with respect to matters
involving the perfection of the Agent's Lien on the Credit Security.
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Each of the undersigned has caused this Agreement to be executed and
delivered by its duly authorized officer as an agreement under seal as of the
date first above written.
TRANSMONTAIGNE INC.
By /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
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▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇, President
TRANSMONTAIGNE PRODUCT SERVICES
INC.
TRANSMONTAIGNE PRODUCT SERVICES
MIDWEST INC.
TRANSMONTAIGNE TRANSPORTATION
SERVICES INC.
TRANSMONTAIGNE PIPELINE INC.
TRANSMONTAIGNE TERMINALING INC.
BEAR PAW ENERGY INC.
By /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
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▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇, Chief Executive Officer
of each of the foregoing corporations
BANKBOSTON, N.A.,
for Itself and as Agent
By /s/ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
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Authorized Officer
BankBoston, N.A.
Energy and Utilities Division
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
Telex: 940581
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