EXHIBIT 10.1
STANDARD CHARTERED BANK, as Administrative Agent,
L/C Issuer and Lender under and as defined in
the Reimbursement Agreement (as defined below)
0000 Xxxxxx xx xxx Xxxxxxxx
Xxx Xxxx XX 00000
Dated as of August 27, 2002
EOTT Energy Operating Limited Partnership
0000 X. Xxx Xxxxxxx Xxxxxxx, Xxxxx 000
Xxxxxxx, Xxxxx 00000
RE: LIMITED FORBEARANCE AND FIRST AMENDMENT
Ladies and Gentlemen:
Reference is hereby made to the Second Amended and Restated
Reimbursement, Loan and Security Agreement, dated as of April 23, 2002 (as
heretofore amended, supplemented or otherwise modified and in effect on the date
hereof, the "REIMBURSEMENT AGREEMENT"), among EOTT ENERGY OPERATING LIMITED
PARTNERSHIP, a Delaware limited partnership ("EOTT OLP"), EOTT ENERGY CANADA
LIMITED PARTNERSHIP, a Delaware limited partnership ("EOTT CANADA"), EOTT ENERGY
LIQUIDS, L.P., a Delaware limited partnership ("EOTT LIQUIDS"), EOTT ENERGY
PIPELINE LIMITED PARTNERSHIP, a Delaware limited partnership ("EOTT PIPELINE"
and together with EOTT Canada and EOTT Liquids, collectively, the "ADDITIONAL
OBLIGORS" and the Additional Obligors together with EOTT OLP on a joint and
several basis, "BORROWER"), EOTT ENERGY PARTNERS, L.P., a Delaware limited
partnership ("EOTT MLP"), EOTT ENERGY GENERAL PARTNERS, L.L.C., a Delaware
limited liability company ("EOTT GP" and together with EOTT MLP, collectively,
the "GUARANTORS" and together with EOTT OLP and each of the Additional Obligors,
collectively, the "CREDIT PARTIES"), EOTT ENERGY CORP., a Delaware corporation
("EOTT CORP." and together with the Credit Parties, the "ORIGINAL CREDIT
PARTIES"), each of the banks or other lending institutions from time to time
party thereto (the "LENDERS") and STANDARD CHARTERED BANK, a banking institution
organized and existing under the laws of England and Wales ("STANDARD
CHARTERED"), as administrative agent for the Lenders (the "ADMINISTRATIVE
AGENT"), and as L/C Issuer. Capitalized terms which are used in this Limited
Forbearance and First Amendment (this "AGREEMENT") without definition and which
are defined in the Reimbursement Agreement shall have the same meanings herein
as in the Reimbursement Agreement, as amended hereby.
The Credit Parties have informed the Administrative Agent and the
Lenders that the Credit Parties have failed to comply with Section 9(o)
("Minimum Consolidated Net Income
(Loss), Minimum Consolidated EBITDA and Minimum Consolidated Net Worth") of the
Reimbursement Agreement for the Fiscal Quarter ended June 30, 2002, such failure
to comply constituting an Event of Default under Section 10(d) of the
Reimbursement Agreement (such Event of Default being herein referred to as the
"SPECIFIED DEFAULT").
The Credit Parties and Standard Chartered have heretofore entered into
a Limited Forbearance, dated as of August 13, 2002 (the "ORIGINAL LIMITED
FORBEARANCE"), pursuant to which the Lenders and the Administrative Agent have
agreed to forbear from exercising their rights and remedies as a result of the
occurrence of the Specified Default, for the period commencing on the effective
date thereof and ending 5:00 p.m. (New York time) on September 16, 2002.
The Credit Parties have requested that the Lenders and the
Administrative Agent agree to (a) continue to forbear from exercising their
rights and remedies as a result of the occurrence of the Specified Default and
(b) amend certain provisions of the Reimbursement Agreement. The Lenders and the
Administrative Agent have advised the Credit Parties that they are prepared to
agree to (a) extend such forbearance for a limited period and (b) amend such
provisions of the Reimbursement Agreement, in each case on the terms and subject
to the conditions, and in reliance on the representations and releases,
contained herein.
SECTION 1. LIMITED FORBEARANCE. In consideration of and reliance upon
the representations of the Credit Parties contained herein, the Administrative
Agent, the L/C Issuer and the Lenders hereby agree to forbear from exercising
their contractual, legal and equitable rights and remedies arising as a result
of the occurrence of the Specified Default for (but solely for) the period
commencing on the Effective Date (as hereinafter defined) and ending 5:00 p.m.
(New York time) on October 30, 2002 (the "FORBEARANCE PERIOD"). Such agreement
to forbear shall automatically, and without action, notice, demand or any other
occurrence, expire on and as of the end of the Forbearance Period. The
Administrative Agent, the L/C Issuer and the Lenders hereby expressly reserve
their right, at any time after the Forbearance Period, to proceed to enforce any
or all of their respective rights and remedies under or in respect of the Credit
Documents and applicable law which are available as a result of the occurrence
of the Specified Default. The agreement to forbear set forth in this Section 1
shall apply only to the Specified Default. No forbearance with respect to any
other Default or Event of Default, whether presently existing or hereafter
arising, is agreed to hereby.
SECTION 2. AMENDMENTS TO REIMBURSEMENT AGREEMENT. (a) Section 9 of the
Reimbursement Agreement is hereby amended by adding the following new Section
(q) at the end of Section 9:
"(q) Limitation on Interest Payments. None of EOTT MLP, EOTT OLP, EOTT
Pipeline, EOTT Liquids or EOTT Canada will, and EOTT MLP will cause EOTT Energy
Finance Corp., a Delaware corporation, not to, make any interest payment due on
October 1, 2002 in respect of any Indebtedness issued pursuant to the EOTT MLP
Senior Notes Indenture until November 1, 2002."
(b) Section 10 of the Reimbursement Agreement is hereby amended by
deleting subsection (g) in its entirety and substituting the following therefor:
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"(g) Any Credit Party shall default in the payment when due of any
principal of or interest on any of its other Indebtedness in excess of
$1,000,000 in the aggregate (other than Indebtedness the validity of which is
being contested in good faith by appropriate proceedings and for which adequate
reserves with respect thereto are maintained on the books of the Credit Party in
accordance with GAAP), or any event specified in any note, agreement, indenture,
mortgage, deed of trust, security agreement or other document evidencing or
relating to any such Indebtedness shall occur if the effect of such event is to
cause, or (with the giving of any notice or the lapse of time or both) to permit
the holder or holders of such Indebtedness (or a trustee or agent on behalf of
such holder or holders) to cause, such Indebtedness to become due, or to be
prepaid in full (whether by redemption, purchase, offer to purchaser or
otherwise), prior to its stated maturity; provided, however, that default in
payment of any interest payment due on October 1, 2002 in respect of any
Indebtedness issued pursuant to the EOTT MLP Senior Notes Indenture in
compliance with Section 9 (q) hereof shall not constitute an Event of Default
hereunder."
(b) Section 10 of the Reimbursement Agreement is hereby further amended
by deleting subsection (k) in its entirety and substituting the following
therefor:
"(k) Any Material Adverse Change occurs; provided, however, that
default in payment of any interest payment due on October 1, 2002 in respect of
any Indebtedness issued pursuant to the EOTT MLP Senior Notes Indenture in
compliance with Section 9 (q) hereof shall not constitute a Material Adverse
Change."
SECTION 3. COMMITMENT DURING FORBEARANCE PERIOD. Notwithstanding the
occurrence of the Specified Default, during the Forbearance Period, the
Administrative Agent, the L/C Issuer and the Lenders agree that Borrower may
continue to request and receive, and the Lenders and the L/C Issuer shall make
and issue, as applicable, Loans and Letters of Credit, subject to the terms and
conditions of the Reimbursement Agreement.
SECTION 4. REPRESENTATIONS AND WARRANTIES. Each of the Credit Parties
represents and warrants to the Administrative Agent and the Lenders as follows:
(a) The representations and warranties of the Credit Parties contained
in the Credit Documents (i) were true when made, and (ii) shall be true on and
as of the date hereof, except to the extent that such representation or warranty
was made as of a specific date.
(b) The execution and delivery by the Credit Parties of this Agreement
and the performance by the Credit Parties of all of their agreements and
obligations under this Agreement and the Reimbursement Agreement and the other
Credit Documents as amended hereby (i) are within the partnership, corporate or
limited liability authority, as applicable, of each of the Credit Parties, (ii)
have been duly authorized by all necessary partnership, corporate or limited
liability proceedings or actions, as applicable, by the Credit Parties and (iii)
do not and will not (A) conflict with any provision of (x) any law, (y) the
organizational or other charter documents of such Credit Party or (z) any
material agreement, judgment, license, order or permit
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applicable to or binding upon such Credit Party (other than the EOTT MLP Senior
Notes Indenture), or (B) result in, or require the creation of any Lien upon any
assets or properties of such Credit Party, except as expressly contemplated in
the Credit Documents.
(c) This Agreement, the Reimbursement Agreement, as amended hereby, and
the other Credit Documents to which the Credit Parties are a party constitute
legal, valid and binding obligations of such Credit Party, enforceable in
accordance with their respective terms except as such enforcement may be limited
by bankruptcy insolvency or similar Laws of general application relating to the
enforcement of creditors' rights.
(d) Other than the Specified Default, no Default or Event of Default
exists on the date hereof.
SECTION 5. CONDITIONS TO EFFECTIVENESS. This Agreement shall become
effective on the date (the "Effective Date") that the Administrative Agent shall
have received duly executed counterparts of this Agreement, which, when taken
together, bear the authorized signatures of each of the parties hereto.
SECTION 6. GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY, AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK (WITHOUT
REFERENCE TO CONFLICT OF LAWS).
SECTION 7. EXPENSES. The Credit Parties shall pay all reasonable
out-of-pocket expenses (including, without limitation, reasonable legal fees and
expenses) incurred by the Administrative Agent in connection with the
preparation, negotiation, execution, delivery and enforcement of this Agreement.
SECTION 8. RELEASE. Each of the Credit Parties and each of their
respective affiliates, subsidiaries, successors, assigns, employees, agents and
attorneys (collectively, the "Releasors"), hereby release and forever discharge
each of the Administrative Agent, L/C Issuer and each Lender, and each of their
respective parents, subsidiaries, affiliates, officers, directors, employees,
agents, attorneys, predecessors, successors and assigns, both present and former
(collectively, together with the Administrative Agent and the Lenders, the
"Lender Affiliates"), of and from any and all manner of action and actions,
causes of action, suits, debts, controversies, damages, judgments, executions,
claims and demands whatsoever, asserted or unasserted, in law or in equity,
against any of the Lender Affiliates which any Releasor ever had or now has on
the date hereof upon or by reason of any manner, cause, causes or thing
whatsoever, whether presently existing, suspected or unsuspected, known or
unknown, fixed or contingent, direct or indirect, contemplated or anticipated,
arising out of or in connection with the Reimbursement Agreement.
SECTION 9. MISCELLANEOUS. From and after the date hereof, this
Agreement shall be deemed a Credit Document for all purposes of the
Reimbursement Agreement and the other Credit Documents and each reference to
Credit Documents in the Reimbursement Agreement and the other Credit Documents
shall be deemed to include this Agreement. Except as expressly provided herein,
this Agreement shall not, by implication or otherwise, limit, impair, constitute
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an agreement to forbear or otherwise affect any rights or remedies of the
Administrative Agent or the Lenders in respect of the Reimbursement Agreement or
the other Credit Documents, nor alter, modify, amend or in any way affect any of
the obligations or covenants contained in the Reimbursement Agreement or any of
the other Credit Documents, all of which are ratified and confirmed in all
respects and shall continue in full force and effect. This Agreement may be
executed in any number of counterparts, but all of such counterparts shall
together constitute but one and the same agreement. Delivery of an executed
counterpart of a signature page by facsimile transmission shall be effective as
delivery of a manually executed counterpart of this Agreement. In making proof
of this Agreement, it shall not be necessary to produce or account for more than
one such counterpart. This Agreement amends and restates the Original Limited
Forbearance in its entirety.
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed by their duly authorized officer, all as of the
date first above written.
EOTT ENERGY OPERATING LIMITED
PARTNERSHIP,
as a Borrower Party and as the Borrower
Representative
By: EOTT ENERGY GENERAL PARTNER,
L.L.C., its General Partner
By: /s/ Xxxxxxxx Xxxxxxx mms
---------------------------------
Name: Xxxxxxxx Xxxxxxx
Title: CFO & Sr. V.P.
EOTT ENERGY CANADA LIMITED
PARTNERSHIP,
as a Borrower Party
By: EOTT ENERGY GENERAL PARTNER,
L.L.C., its General Partner
By: /s/ Xxxxxxxx Xxxxxxx mms
---------------------------------
Name: Xxxxxxxx Xxxxxxx
Title: CFO & Sr. V.P.
EOTT ENERGY LIQUIDS, L.P.,
as a Borrower Party
By: EOTT ENERGY GENERAL PARTNER,
L.L.C., its General Partner
By: /s/ Xxxxxxxx Xxxxxxx mms
---------------------------------
Name: Xxxxxxxx Xxxxxxx
Title: CFO & Sr. V.P.
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EOTT ENERGY PIPELINE LIMITED
PARTNERSHIP,
as a Borrower Party
By: EOTT ENERGY GENERAL PARTNER,
L.L.C., its General Partner
By: /s/ Xxxxxxxx Xxxxxxx mms
---------------------------------
Name: Xxxxxxxx Xxxxxxx
Title: CFO & Sr. V.P.
EOTT ENERGY PARTNERS, L.P.,
as a Guarantor
By: EOTT ENERGY CORP., its General
Partner
By: /s/ Xxxxxxxx Xxxxxxx
---------------------------------
Name: Xxxxxxxx Xxxxxxx
Title: CFO & Sr. V.P.
EOTT ENERGY GENERAL PARTNER, L.L.C.,
as a Guarantor
By: /s/ Xxxxxxxx Xxxxxxx
---------------------------------
Name: Xxxxxxxx Xxxxxxx
Title: CFO & Sr. V.P.
STANDARD CHARTERED BANK,
an Administrative Agent, L/C Issuer and
Lender
By: /s/ X. XxXxxxxx
---------------------------------
Name: X. XxXxxxxx
Title: Regional Head ASAM
By: /s/ X. X. Xxxxx
---------------------------------
Name: X. X. Xxxxx
Title: Senior Vice President
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