EXHIBIT 4(c)
NINTH AMENDMENT TO LOAN AGREEMENT
THIS NINTH AMENDMENT TO LOAN AGREEMENT (this "Ninth Amendment") is made
and entered into as of the 21st day of March, 2002, by and among SERVICE
TRANSPORT COMPANY, a Texas corporation ("Service Transport Company"), XXXXX
RESOURCES EXPLORATION CORPORATION, a Delaware corporation ("Exploration"),
XXXXXXX MINING CORPORATION, a Kentucky corporation ("Xxxxxxx Mining"), CJC
LEASING, INC., a Kentucky corporation ("CJC"), CLASSIC COAL CORPORATION, a
Delaware corporation ("Classic Coal"), ADA MINING CORPORATION, a Texas
corporation ("Ada Mining"), ADA RESOURCES, INC., a Texas corporation ("Ada
Resources"), and BAYOU CITY PIPELINES, INC., a Texas corporation formerly known
as Bayou City Barge Lines, Inc. ("Bayou City"), each with offices and place of
business at 0 Xxxx Xxx Xxxxx, 0000 Xxxx Xxx Xxxxxxx, 00xx Xxxxx, Xxxxxxx, Xxxxx
00000 (Service Transport Company, Exploration, Xxxxxxx Mining, CJC, Classic
Coal, Ada Mining and Bayou City are hereinafter individually called a "Borrower"
and collectively called the "Borrowers"), and BANK OF AMERICA, N.A., a national
banking association (the "Lender"), successor in interest by merger to
NationsBank, N.A. ("NationsBank"), which had changed its name to Bank of
America, N.A., and which was the successor in interest by merger to NationsBank
of Texas, N.A. (the "Original Lender").
WHEREAS, the Borrowers and Ada Crude Oil Company ("Ada Crude Oil")
(collectively referred to as the "Original Borrowers") and the Original Lender
entered into that certain Loan Agreement dated October 27, 1993, which Loan
Agreement was amended by that certain First Amendment to Loan Agreement dated
October 27, 1994 among the Original Borrowers and the Original Lender, that
certain Second Amendment to Loan Agreement dated December 29, 1995 among the
Original Borrowers and the Original Lender, that certain Third Amendment to Loan
Agreement dated January 27, 1997 among the Original Borrowers and the Original
Lender and that certain Fourth Amendment to Loan Agreement (the "Fourth
Amendment") dated September 30, 1997 among the Original Borrowers and the
Original Lender (as amended, the "Original Loan Agreement"); and
WHEREAS, the Borrowers (other than Ada Resources) and NationsBank
entered into that certain Fifth Amendment to Loan Agreement dated February 2,
1999, and the Borrowers (other than Ada Resources) and Lender entered into that
certain Sixth Amendment to Loan Agreement dated October 29, 1999; and
WHEREAS, the Borrowers and the Lender entered into that certain Seventh
Amendment to Loan Agreement dated March 22, 2000 (the "Seventh Amendment") and
that certain Eighth Amendment to Loan Agreement dated October 27, 2000 (the
"Eighth Amendment") (the Original Loan Agreement, as amended by the Fifth
Amendment, the Sixth Amendment, the Seventh Amendment and the Eighth Amendment,
is referred to herein as the "Loan Agreement"); and
WHEREAS, due to the assignment of the assets and assumption of
liabilities of Ada Crude Oil, it is no longer a party under the Loan Agreement;
and
WHEREAS, the Borrowers and the Lender desire to make certain amendments
to the terms and provisions of the Loan Agreement, as set forth herein.
NOW, THEREFORE, FOR AND IN CONSIDERATION of the mutual covenants and
agreements contained herein, the parties hereto agree as follows:
1. The definition of "Adjusted Base Rate" in Section 1.2(a) of the Loan
Agreement is deleted in its entirety, and the following is substituted in its
place:
"Adjusted Base Rate" shall mean the Base Rate minus one-half
percent (1/2%) per annum.
2. The definition of "Adjusted LIBOR Rate" in Section 1.2(a) of the
Loan Agreement is deleted in its entirety, and the following is substituted in
its place:
"Adjusted LIBOR Rate" shall mean the LIBOR Rate plus two and
three-quarters percent (2-3/4%) per annum.
3. Notwithstanding any other provision to the contrary in the Loan
Agreement, unless, as of the effective date of the most recent Certificate of
Compliance delivered to the Lender, the Guarantor's consolidated Interest
Coverage Ratio is at least 3.0 to 1.0 for the preceding twelve (12) months, both
the Adjusted Base Rate and the Adjusted LIBOR Rate shall be one-fourth of one
percent (1/4%) per annum higher than otherwise provided herein until delivery by
the Guarantor to the Lender of a subsequent Certificate of Compliance indicating
that, as of the effective date thereof, the Guarantor's consolidated Interest
Coverage Ratio is at least 3.0 to 1.0 for the preceding twelve (12) months.
4. There is added to Section 1.2 of the Loan Agreement a definition of
"Permitted Intercompany Investments and Advances", which shall read as follows:
"Permitted Intercompany Investments and Advances" shall mean,
collectively, (i) the equity investments of the Guarantor in its
Subsidiaries as of December 31, 2001, which the Borrowers represent and
warrant to Lender have a fair value as of such date of approximately
$10,700,000.00, and (ii) up to an additional $4,500,000.00 of Debt
payable by Guarantor or any Subsidiary of Guarantor to Guarantor or any
Subsidiary of Guarantor.
5. The first sentence of Section 1.3(a) of the Loan Agreement is
deleted in its entirety, and the following is substituted in its place:
The Lender, during the period from the date of the Ninth Amendment
through October 29, 2003, subject to the terms and conditions of this
Agreement, agrees (i) to make loans to the Borrowers pursuant to a
revolving credit and term loan facility up to but not in excess of the
lesser of $10,000,000.00 or the amount of the Tranche A Borrowing Base
and (ii) to make additional loans to the Borrowers pursuant to a
revolving credit and term loan facility up to but not in excess of the
lesser of $7,500,000.00 or the amount of the Tranche B Borrowing Base.
6. The fourth and fifth sentences of Section 1.3(b) of the Loan
Agreement are deleted in their entirety, and the following is substituted in
their place:
Commencing October 31, 2003, a principal payment shall made on each
Note on the last day of each October, January, April and July in an
amount equal to one-twelfth (1/12th) of the principal amount
outstanding under such Note at the close of Lender's business on
October 29, 2003. All unpaid principal and accrued and unpaid interest
on the Notes shall be due and payable on or before October 29, 2006.
7. There is added to the end of Section 4.1 of the Loan Agreement the
following:
In addition to the foregoing, the Guarantor and its Subsidiaries shall
be entitled to make Permitted Intercompany Investments and Advances.
Any payee of any Permitted Intercompany Investment and Advance shall be
entitled to subordinate its right to payment owed to it by any
Subsidiary (other than a Borrower) so long as the subordination
agreement evidencing such subordination
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permits payment of such Permitted Intercompany Investment and Advance
so long as there is no event of default (after the passage of any
applicable notice and cure period) in the documents evidencing the
indebtedness of such Subsidiary to the lender (the "Senior Lender")
requesting such subordination agreement.
8. Clauses (b), (c) and (d) of Section 4.3 of the Loan Agreement are
deleted in their entirety, and the following is substituted in their place:
(b) the Guarantor and its Subsidiaries may make Permitted Intercompany
Investments and Advances, and (c) the Guarantor may make the loan
permitted by the terms of Section 4.8 of this Agreement.
9. Section 4.7(a) of the Loan Agreement is deleted in its entirety, and
the following is substituted in its place:
(a) their and the Guarantor's consolidated Net Worth to be
less than the sum of (i) $31,357,000.00 plus (ii) fifty percent (50%)
of the positive consolidated net income of the Guarantor and the
Borrowers during each fiscal year, commencing with the fiscal year
ending December 31, 2002, plus (iii) seventy-five percent (75%) of the
net amount received by the Guarantor upon any sale, issuance or
exchange by the Guarantor of any of its capital stock or rights to
acquire such capital stock;
10. Section 4.7(d) of the Loan Agreement is deleted in its entirety,
and the following is substituted in its place:
(d) their and the Guarantor's consolidated Interest Coverage
Ratio to be less than 2.0 to 1.0 as of June 30, 2002, or any time prior
to such date, to be less than 2.5 to 1.0 as of September 30, 2002, or
to be less than 3.0 to 1.0 as of December 31, 2002 or any time
thereafter.
11. There is added to the end of Section 4.7 of the Loan Agreement the
following paragraph:
Notwithstanding the definition of "Interest Coverage Ratio", for
purposes of the calculation of Guarantor's consolidated Interest
Coverage Ratio (1) for the period ended March 31, 2002, such
calculation shall be made using net income before interest expense and
taxes, and interest expense, including interest which may be required
to be capitalized, for the month of March, 2002, (2) for the period
ending June 30, 2002, such calculation shall be made using net income
before interest expense and taxes, and the interest expense, including
interest which may be required to be capitalized, for the preceding six
(6) months, and (3) for the period ending September 30, 2002, such
calculation shall be made using net income before interest expense and
taxes, and interest expense, including interest which may be required
to be capitalized, for the preceding nine (9) months. Commencing with
respect to the period ended December 31, 2002, such covenant shall be
calculated utilizing the definition of "Interest Coverage Ratio" set
forth in this Agreement.
12. There is added to Section 5.1 of the Loan Agreement an additional
Event of Default, which shall be added as Section 5.1(i) and which shall read as
follows:
(i) the occurrence of any event of default (after the passage
of any applicable notice and cure period) under any document evidencing
the indebtedness of any Subsidiary to a Senior Lender.
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13. The Borrowers and Lender hereby agree that, from and after the date
of this Ninth Amendment, the Tranche A Borrowing Base shall be $4,000,000.00,
until the time of the next redetermination thereof pursuant to the terms of the
Loan Agreement.
14. The Borrowers have requested certain waivers under the Loan
Agreement and, subject to the following terms and conditions, the Lender has
agreed to make such waivers. The Borrowers represent to the Lender that advances
in the aggregate approximate amount of $27,273,147 were made by Gulfmark to the
Guarantor and then subsequently advanced by the Guarantor to or for the benefit
of Xxxxx Resources Marketing, Ltd. To the extent such advances by the Guarantor
would be deemed to be loans in or advances made by the Guarantor to a Subsidiary
other than a Borrower, the same may have resulted in a violation of Section 4.1
of the Loan Agreement. To the extent such violation occurred, the Lender hereby
agrees to waive the requirements of Section 4.1 of the Loan Agreement with
respect to such transactions. This waiver is applicable only to the loans and
advances described in this paragraph and does not waive the requirements of
Section 4.1 of the Loan Agreement with respect to any other transaction. Lender
further agrees to waive the Borrowers' non-compliance with the requirements of
Section 4.7(d) of the Loan Agreement with respect to the period ended December
31, 2001. This waiver is applicable only to such period and does not waive the
requirements of Section 4.7(d) of the Loan Agreement with respect to any other
period.
15. The closing of the transactions contemplated by this Ninth
Amendment is subject to the satisfaction of the following conditions:
(a) All legal matters incident to the transactions herein
contemplated shall be satisfactory to Gardere Xxxxx Xxxxxx LLP, counsel
to the Lender;
(b) The Lender shall have received a fully executed copy of
this Ninth Amendment and a Notice as to Written Agreement; and
(c) The Lender shall have received an executed copy of
resolutions of the Board of Directors of each of the Borrowers and the
Guarantor, in form and substance satisfactory to the Lender,
authorizing the execution, delivery and performance of this Ninth
Amendment and all documents, instruments and certificates referred to
herein.
16. Each of the Borrowers hereby reaffirms each of its representations,
warranties, covenants and agreements set forth in the Loan Agreement with the
same force and effect as if each were separately stated herein and made as of
the date hereof. Except as amended hereby, the Loan Agreement shall remain
unchanged, and the terms, conditions and covenants of the Loan Agreement shall
continue and be binding upon the parties hereto.
17. Each of the Borrowers hereby agrees that its liability under any
and all documents and instruments executed by it as security for the
Indebtedness (including, without limitation, the Mortgages, the Security
Agreements, the Collateral Assignment and the Pledges) shall not be reduced,
altered, limited, lessened or in any way affected by the execution and delivery
of this Ninth Amendment or any of the instruments or documents referred to
herein, except as specifically set forth herein or therein, that all of such
documents and instruments are hereby renewed, extended, ratified, confirmed and
carried forward by the Borrowers in all respects, that all of such documents and
instruments shall remain in full force and effect and are and shall remain
enforceable against the Borrowers in accordance with their terms and that all of
such documents and instruments shall cover all indebtedness of the Borrowers to
the Lender described in the Loan Agreement as amended hereby.
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18. Each of the terms defined in the Loan Agreement is used in this
Ninth Amendment with the same meaning, except as otherwise indicated in this
Ninth Amendment. Each of the terms defined in this Ninth Amendment is used in
the Loan Agreement with the same meaning, except as otherwise indicated in the
Loan Agreement.
19. THIS NINTH AMENDMENT SHALL BE DEEMED TO BE A CONTRACT UNDER,
SUBJECT TO, AND SHALL BE CONSTRUED FOR ALL PURPOSES IN ACCORDANCE WITH THE LAWS
OF THE STATE OF TEXAS.
20. THE LOAN AGREEMENT, AS AMENDED, REPRESENTS THE FINAL AGREEMENT
BETWEEN THE PARTIES AND MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR,
CONTEMPORANEOUS OR SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES.
THERE ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN THE PARTIES.
IN WITNESS WHEREOF, the parties have caused this Ninth Amendment to be
executed by their duly authorized officers as of the day and year first above
written.
SERVICE TRANSPORT COMPANY
By:
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Name:
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Title:
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XXXXX RESOURCES EXPLORATION
CORPORATION
By:
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Name:
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Title:
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XXXXXXX MINING CORPORATION
By:
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Name:
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Title:
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CJC LEASING, INC.
By:
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Name:
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Title:
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CLASSIC COAL CORPORATION
By:
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Name:
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Title:
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ADA MINING CORPORATION
By:
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Name:
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Title:
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ADA RESOURCES, INC.
By:
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Name:
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Title:
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BAYOU CITY PIPELINES, INC.
By:
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Name:
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Title:
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BANK OF AMERICA, N.A.
By:
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Name:
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Title:
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Guarantor joins in the execution of this Ninth Amendment to evidence
that it hereby agrees and consents to all of the matters contained in this Ninth
Amendment and further agrees that (i) its liability under that certain Guaranty
Agreement dated October 27, 1993, executed by Guarantor for the benefit of the
Lender, as the same may be amended or modified from time to time (the
"Guaranty") shall not be reduced, altered, limited, lessened or in any way
affected by the execution and delivery of this Ninth Amendment or any of the
instruments or documents referred to herein by the parties hereto, except as
specifically set forth herein or therein, (ii) the Guaranty is hereby renewed,
extended, ratified, confirmed and carried forward in all respects, (iii) the
Guaranty is and shall remain in full force and effect and is and shall remain
enforceable against Guarantor in accordance with its terms and (iv) the Guaranty
shall cover all indebtedness of the Borrowers to the Lender described in the
Loan Agreement as amended hereby.
XXXXX RESOURCES & ENERGY, INC.
By:
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Name:
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Title:
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