EXHIBIT 10.29
EXECUTION COPY
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PARITY DEBT CREDIT AGREEMENT
dated as of February 22, 2002
among
STAR GAS PROPANE, L.P.,
THE LENDERS NAMED HEREIN,
FLEET NATIONAL BANK,
as Administrative Agent,
and
BANK OF AMERICA, N.A.,
as Documentation Agent
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TABLE OF CONTENTS
Page
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ARTICLE I DEFINITIONS.............................................................................................1
Section 1.01 Defined Terms.............................................................................1
Section 1.02 Terms Generally..........................................................................28
Section 1.03 Types of Borrowings......................................................................28
ARTICLE II THE CREDITS...........................................................................................28
Section 2.01 Commitment to Make Loans.................................................................28
Section 2.02 Loans....................................................................................29
Section 2.03 Notice of Borrowings.....................................................................31
Section 2.04 Notes; Repayment of Loans................................................................32
Section 2.05 Fees.....................................................................................32
Section 2.06 Interest on Loans........................................................................33
Section 2.07 Default Interest.........................................................................33
Section 2.08 Alternate Rate of Interest...............................................................34
Section 2.09 Termination and Reduction of Commitments; Conversion of Revolving Loans..................34
Section 2.10 Conversion and Continuation of Term Borrowings...........................................35
Section 2.11 Mandatory Repayments and Prepayments.....................................................36
Section 2.12 Optional Prepayments.....................................................................39
Section 2.13 Reserve Requirements; Certain Changes in Circumstances...................................40
Section 2.14 Change in Legality.......................................................................41
Section 2.15 Indemnity................................................................................42
Section 2.16 Pro Rata Treatment.......................................................................42
Section 2.17 Sharing of Setoffs.......................................................................43
Section 2.18 Payments.................................................................................43
Section 2.19 Taxes....................................................................................43
Section 2.20 Assignment of Commitments Under Certain Circumstances....................................45
Section 2.21 Letters of Credit........................................................................46
ARTICLE III REPRESENTATIONS AND WARRANTIES.......................................................................50
Section 3.01 Organization; Powers.....................................................................50
Section 3.02 Authorization............................................................................50
Section 3.03 Enforceability...........................................................................51
Section 3.04 Consents and Governmental Approvals......................................................51
Section 3.05 Business; Financial Statements...........................................................51
Section 3.06 No Material Adverse Change...............................................................52
Section 3.07 Title to Properties; Possession Under Leases.............................................52
Section 3.08 Subsidiaries.............................................................................52
Section 3.09 Litigation; Compliance with Laws.........................................................52
Section 3.10 Agreements...............................................................................53
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Section 3.11 Federal Reserve Regulations..............................................................53
Section 3.12 Investment Company Act; Public Utility Holding Company Act...............................53
Section 3.13 Use of Proceeds..........................................................................53
Section 3.14 Tax Returns..............................................................................54
Section 3.15 No Material Misstatements................................................................54
Section 3.16 Employee Benefit Plans...................................................................54
Section 3.17 Environmental and Safety Matters.........................................................55
Section 3.18 Security Interests.......................................................................56
Section 3.19 Solvency.................................................................................57
Section 3.20 Transactions with Affiliates.............................................................57
Section 3.21 Ownership................................................................................57
Section 3.22 Insurance................................................................................57
Section 3.23 Labor Relations..........................................................................58
Section 3.24 Changes, etc.............................................................................58
Section 3.25 Indebtedness.............................................................................58
Section 3.26 Business.................................................................................58
Section 3.27 Chief Executive Office...................................................................59
Section 3.28 Fixed Price Supply Contracts.............................................................59
Section 3.29 Trading and Inventory Policies...........................................................59
Section 3.30 Parity Debt..............................................................................59
ARTICLE IV CONDITIONS OF LENDING.................................................................................60
Section 4.01 Effectiveness............................................................................60
Section 4.02 All Extensions of Credit.................................................................66
ARTICLE V ACCOUNTING; FINANCIAL STATEMENTS; INSPECTION...........................................................68
Section 5.01 Accounting...............................................................................68
Section 5.02 Financial Statements.....................................................................68
Section 5.03 Inspection...............................................................................73
ARTICLE VI BUSINESS AND FINANCIAL COVENANTS......................................................................74
Section 6.01 Indebtedness.............................................................................74
Section 6.02 Liens, etc...............................................................................77
Section 6.03 Investments, Guaranties, etc.............................................................79
Section 6.04 Restricted Payments......................................................................80
Section 6.05 Transactions with Affiliates.............................................................81
Section 6.06 Prohibited Stock and Indebtedness........................................................82
Section 6.07 Consolidation, Merger, Sale of Assets, etc...............................................82
Section 6.08 Partnership or Corporate Existence etc.; Business........................................84
Section 6.09 Payment of Taxes and Claims..............................................................85
Section 6.10 Compliance with ERISA....................................................................85
Section 6.11 Maintenance of Properties; Insurance.....................................................86
Section 6.12 Operative Agreements; Collateral Documents...............................................86
Section 6.13 Chief Executive Office...................................................................87
Section 6.14 [Intentionally Omitted]..................................................................87
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Section 6.15 Covenant to Secure Notes Equally.........................................................87
Section 6.16 Compliance with Laws.....................................................................87
Section 6.17 Further Assurances.......................................................................88
Section 6.18 Subsidiaries.............................................................................89
Section 6.19 Certain Post-Closing Matters.............................................................90
Section 6.20 Use of Proceeds..........................................................................90
Section 6.21 Accounting Changes.......................................................................90
Section 6.22 Certain Real Property....................................................................91
Section 6.23 Sale and Lease-Back Transactions.........................................................92
Section 6.24 Acquisitions.............................................................................92
Section 6.25 Impairment of Security Interests.........................................................92
Section 6.26 Limitation on Restrictions on Subsidiary Dividends, etc..................................92
Section 6.27 No Other Negative Pledges................................................................92
Section 6.28 Sales of Receivables.....................................................................93
Section 6.29 Fixed Price Supply Contracts; Certain Policies...........................................93
Section 6.30 Certain Operations.......................................................................93
Section 6.31 [Intentionally Omitted]..................................................................93
Section 6.32 Independent Corporate Existence..........................................................94
ARTICLE VII EVENTS OF DEFAULT....................................................................................95
Section 7.01 Events of Default........................................................................95
Section 7.02 Remedies.................................................................................98
ARTICLE VIII THE AGENTS AND ISSUING BANK.........................................................................99
Section 8.01 Appointment and Authorization............................................................99
Section 8.02 Liability of Agents......................................................................99
Section 8.03 Action by Agents........................................................................100
Section 8.04 Successor Agents........................................................................100
Section 8.05 Agent and Affiliate.....................................................................101
Section 8.06 Indemnification.........................................................................101
Section 8.07 Credit Decision.........................................................................101
Section 8.08 Trust Agreement.........................................................................102
ARTICLE IX MISCELLANEOUS........................................................................................102
Section 9.01 Notices.................................................................................102
Section 9.02 Survival of Agreement...................................................................102
Section 9.03 Binding Effect..........................................................................103
Section 9.04 Successors and Assigns..................................................................103
Section 9.05 Expenses; Indemnity.....................................................................106
Section 9.06 Right of Setoff.........................................................................108
Section 9.07 Applicable Law..........................................................................108
Section 9.08 Waivers; Amendment......................................................................108
Section 9.09 Interest Rate Limitation................................................................109
Section 9.10 Entire Agreement........................................................................110
Section 9.11 Severability............................................................................110
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Section 9.12 Counterparts............................................................................110
Section 9.13 Headings................................................................................110
Section 9.14 Jurisdiction; Consent to Service of Process; Waiver of Jury Trial.......................110
Section 9.15 Legend..................................................................................111
Section 9.16 [Intentionally Omitted].................................................................111
Schedules
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Schedule 1.01A Lenders and Commitments
Schedule 1.01B Restricted Subsidiaries
Schedule 3.05(a) Petroleum Locations
Schedule 3.05(d) Undisclosed Liabilities
Schedule 3.07 Real Property
Schedule 3.08 Subsidiaries
Schedule 3.09 Litigation
Schedule 3.14 State Taxes
Schedule 3.16 Employee Benefit Plans
Schedule 3.17 Environmental Matters
Schedule 3.18 Security Interests
Schedule 3.20 Transactions with Affiliates
Schedule 3.28 Fixed Price Supply Contracts
Schedule 6.19 Certain Mortgaged Properties
Schedule 6.32 Independent Corporate Existence
Exhibits
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Exhibit A.........Form of Note
Exhibit B-1.......Form of General Partner Consent and Agreement
Exhibit B-2.......Form of Public Partner Consent and Agreement
Exhibit C.........Form of Subsidiaries Consent and Agreement
Exhibit D.........Form of Intercompany Note
Exhibit E.........Form of Assignment and Acceptance
Exhibit F-1.......Form of Opinion of Xxxxxxxx Xxxxx Xxxxxxxx Xxxx & Ballon LLP
Exhibit F-2.......Form of Opinion of Local Counsel to Borrower
Exhibit G.........Form of Perfection Certificate
Exhibit H.........Form of Supplemental Agreement
Exhibit I.........Form of Notice of Borrowing
Exhibit J.........Form of Agreement of Parity Lenders and Supplement to Intercreditor Agreement
Exhibit K.........Form of Compliance Certificate
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PARITY DEBT CREDIT AGREEMENT dated as of February 22, 2002, among STAR
GAS PROPANE, L.P., a Delaware limited partnership, the Lenders (as defined
herein), FLEET NATIONAL BANK, as Administrative Agent, and BANK OF AMERICA,
N.A., as Documentation Agent.
The Borrower (such term, and all other capitalized terms in this
paragraph, being used as hereinafter defined) has requested the Lenders to
extend credit to the Borrower in the aggregate principal amount of up to
$25,000,000 which Indebtedness shall constitute Parity Debt under Section
6.01(b) of the Existing Credit Agreement, Section 10.1(b) of the Note Agreement
and the comparable sections under the various Parity Debt Agreements. The
Lenders are willing to extend such credit to the Borrower upon the terms and
subject to the conditions set forth herein. Accordingly, the Borrower, the
Lenders, the Agents and the Issuing Bank agree as follows:
ARTICLE I
DEFINITIONS
Section 1.01 Defined Terms. As used in this Agreement, the following
terms shall have the meanings specified below:
"ABR Borrowing" shall mean a Borrowing comprised of ABR Loans.
"ABR Loan" shall mean any ABR Revolving Loan or ABR Term Loan.
"ABR Revolving Loan" shall mean any Revolving Loan bearing interest at
a rate determined by reference to the Alternate Base Rate in accordance with the
provisions of Article II.
"ABR Term Loan" shall mean any Term Loan bearing interest at a rate
determined by reference to the Alternate Base Rate in accordance with the
provisions of Article II.
"Acquired Business Entity" means (i) any business entity the capital
stock or assets of which have been acquired substantially as an entirety by the
Borrower by purchase, merger or, consolidation, and (ii) any other assets which
were operated as an identifiable business unit, i.e., a branch or division of a
business entity and which have been acquired substantially as an entirety by the
Borrower.
"Adjusted LIBO Rate" shall mean, with respect to any Eurodollar
Borrowing for any Interest Period, the rate, rounded upwards to the nearest
1/100%, obtained by dividing (a) the LIBO Rate for such Interest Period by (b)
an amount equal to 1 minus the Statutory Reserves, if any; provided, however,
that if any time during such Interest Period the Statutory Reserves applicable
to such Eurodollar Borrowing changes, the Adjusted LIBO Rate shall automatically
be adjusted to reflect such change, effective as of the date of such change.
"Administrative Agent" shall mean Fleet National Bank, in its capacity
as administrative agent for the Lenders hereunder, and its successors in such
capacity.
"Administrative Questionnaire" shall mean, with respect to each Lender,
the administrative questionnaire in the form submitted to such Lender by the
Administrative Agent and returned to the Administrative Agent duly completed by
such Lender.
"Affiliate", as applied to any Person, shall mean any other Person
directly or indirectly controlling or controlled by or under common control with
such Person, provided that (i) for purposes of this definition, "control"
(including, with correlative meanings, the terms "controlled by" and "under
common control with") as used with respect to any Person shall mean the
possession, directly or indirectly, of the power to direct or cause the
direction of the management and policies of such Person, whether as a general
partner or through the ownership of voting securities or by contract or
otherwise, (ii) as applied to the Borrower, the term "Affiliate" shall include
Petro Holdings, Petro, all Subsidiaries of Petro, the General Partner and the
Public Partnership, and (iii) no Person which is an institution shall be deemed
to be an Affiliate of the Borrower solely by reason of ownership of the Facility
Obligations or other securities issued in exchange for the Facility Obligations
or by reason of having the benefits of any agreements or covenants contained in
this Agreement or the other Operative Agreements.
"After Acquired Property" shall have the meaning assigned to such term
in Section 6.22.
"Agents" shall mean the Administrative Agent and the Documentation
Agent.
"Aggregate Cost of Unmortgaged Property" shall have the meaning
assigned to such term in Section 6.22.
"Agreement" shall mean this Parity Debt Credit Agreement, as amended,
modified, restated or supplemented from time to time.
"Alternate Base Rate" shall mean, for any day, a rate per annum
(rounded upwards, if necessary, to the next 1/16 of 1%) equal to the greater of
(a) the Federal Funds Effective Rate in effect on such day plus 0.50% and (b)
the Prime Rate in effect on such day. If the Administrative Agent shall have
determined (which determination shall be conclusive absent manifest error) that
it is unable to ascertain the Federal Funds Effective Rate for any reason,
including the inability or failure of the Administrative Agent to obtain
sufficient quotations in accordance with the terms hereof, the Alternate Base
Rate shall be determined without regard to clause (a) of the first sentence of
this definition until the circumstances giving rise to such inability no longer
exist. Any change in the Alternate Base Rate due to a change in the Prime Rate
or the Federal Funds Effective Rate shall be effective on the effective date of
such change in the Prime Rate or the Federal Funds Effective Rate, respectively,
without notice to the Borrower.
"Applicable Margin" shall mean (a) with respect to any ABR Revolving
Loan or ABR Term Loan, the Applicable ABR Margin and (b) with respect to any
Eurodollar Revolving Loan or Eurodollar Term Loan, the Applicable Eurodollar
Margin.
"Applicable ABR Margin" shall mean, with respect to any Revolving Loan
or Term Loan outstanding on any day:
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(i) 0.625%, if such day falls within a Level I Pricing Period;
(ii) 0.875%, if such day falls within a Level II Pricing Period; and
(iii) 1.125%, if such day falls within a Level III Pricing Period.
"Applicable Eurodollar Margin" shall mean, with respect to any
Revolving Loan or Term Loan outstanding on any day.
(i) 1.625%, if such day falls within a Level I Pricing Period;
(ii) 1.875%, if such day falls within a Level II Pricing Period; and
(iii) 2.125%, if such day falls within a Level III Pricing Period.
"Assets" shall mean assets covered by the Collateral Documents and
assets acquired by the Borrower or the Restricted Subsidiaries from time to
time.
"Assignment and Acceptance" shall mean an assignment and acceptance
entered into by a Lender and an assignee, and accepted by the Administrative
Agent, in the form of Exhibit E or such other form as shall be approved by the
Administrative Agent.
"Audited Financial Statements" shall have the meaning assigned to such
term in Section 3.05(d).
"Available Cash", with respect to any calendar quarter, shall mean (a)
the sum of (i) all cash of the Borrower and the Restricted Subsidiaries on hand
at the end of such quarter and (ii) all additional cash of the Borrower and the
Restricted Subsidiaries on hand through available borrowings made after the end
of such quarter (provided that such borrowings shall in no event exceed
available borrowings as of the end of such quarter) at the date of determination
of Available Cash with respect to such quarter, less (b) any cash reserves that
the General Partner shall determine to be necessary or appropriate in its
reasonable discretion to (A) provide for the proper conduct of the business of
the Borrower and the Restricted Subsidiaries (including cash reserves for future
capital expenditures) or (B) provide funds for distributions under Sections
5.4(a)(i), (ii) and (iii) or 5.4(b)(i) of the MLP Agreement in respect of any
one or more of the next four quarters or (C) comply with applicable law or any
loan agreement (including this Agreement), mortgage, security agreement, debt
instrument or other agreement or obligation to which the Borrower or any
Restricted Subsidiary is a party or its assets are subject, (including the
payment of principal, Make Whole Amount, if applicable, and interest) of the
Borrower in respect of the Notes; provided that Available Cash shall exclude,
without duplication, (w) in each calendar quarter a reserve equal to the
Specified Percentage of the aggregate amount of all interest in respect of all
Indebtedness of the Borrower and the Restricted Subsidiaries to be paid or to
accrue in the next quarter (assuming, in the case of Indebtedness incurred
hereunder, that such Indebtedness will bear interest at the then prevailing rate
for Eurodollar Loans of the applicable Class for one-month's duration, plus the
Applicable Margin for such Loans, and assuming in the case of other Indebtedness
bearing interest at fluctuating interest rates which cannot be determined in
advance, that the interest rate in effect on the last Business Day of the
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immediately preceding calendar quarter will remain in effect until such
Indebtedness is due to be paid), (x) with respect to any Indebtedness of which
principal and/or interest is payable annually (provided, in the case of
principal, that such Indebtedness is secured equally and ratably with the
Mortgage Notes), in the third calendar quarter immediately preceding each
calendar quarter in which any scheduled principal and/or interest payment is due
with respect to such Indebtedness (a "payment quarter"), a reserve equal to at
least 25% of the aggregate amount of all principal and interest to be paid in
respect of such Indebtedness secured equally and ratably with the Mortgage Notes
in such payment quarter; in the second calendar quarter immediately preceding a
payment quarter, a reserve equal to at least 50% of the aggregate amount of all
principal and interest to be paid in respect of such Indebtedness in such
payment quarter; and in the calendar quarter immediately preceding a payment
quarter, a reserve equal to at least 75% of the aggregate amount of all
principal and interest to be paid in respect of such Indebtedness in such
payment quarter, (y) with respect to the Mortgage Notes and any other
Indebtedness of which principal and/or interest is payable semi-annually or
otherwise less frequently than quarterly (provided, in the case of principal,
that such Indebtedness is secured equally and ratably with the Mortgage Notes),
in each calendar quarter a reserve equal to at least 50% of the aggregate amount
of all principal and interest to be paid in respect of the Mortgage Notes and
such other Indebtedness in the next quarter; provided further that the amount of
such reserve specified in clauses (x) and (y) of this definition for principal
amounts to be paid shall be reduced by the aggregate principal amount of all
binding, irrevocable letters of credit established to refinance such principal
amounts, and (z) any assets of any Unrestricted Subsidiary.
"Average Life" shall mean, as of the date of determination, with
respect to any Indebtedness, the quotient obtained by dividing (i) the sum of
the products of (A) the numbers of years from the date of determination to the
dates of each successive scheduled principal payment of such Indebtedness
multiplied by (B) the amount of such payment by (ii) the sum of all such
payments.
"Board" shall mean the Board of Governors of the Federal Reserve System
of the United States.
"Borrower" shall mean Star Gas Propane, L.P., a Delaware limited
partnership.
"Borrower Security Agreement" shall mean the Pledge and Security
Agreement among the Borrower, the General Partner, the Restricted Subsidiaries
and the Trustee dated as of December 13, 1995, as amended from time to time.
"Borrowing" shall mean a group of Loans of a single Class and Type made
by the Lenders on a single date and as to which a single Interest Period is in
effect. For purposes of Section 4.02, (a) a "Borrowing" does not include a
conversion or continuation of the Type of, or the duration of the Interest
Period applicable to, a previously outstanding Term Borrowing pursuant to
Section 2.10 and (b) a "Borrowing" includes each Revolving Credit Borrowing in
which Revolving Loans are refinanced with new Loans as contemplated by Section
2.02(g).
"Business" shall mean the operation by the Borrower and its
Subsidiaries (other than Petro Holdings or its Subsidiaries) of the wholesale
and retail sale, distribution and storage of
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propane gas and related petroleum derivative products and the related retail
sale of supplies and equipment, including home appliances.
"Business Day" shall mean any day (other than a day which is a
Saturday, Sunday or legal holiday in the State of Massachusetts, North Carolina
or New York) on which banks are open for business in Boston, Massachusetts,
Charlotte, North Carolina and New York, New York; provided, however, that, when
used in connection with a Eurodollar Loan, the term "Business Day" shall also
exclude any day on which banks are not open for dealings in dollar deposits in
the applicable interbank market.
"Capital Expenditures" shall mean, for any period, all amounts (whether
paid in cash or accrued as a liability) which would, in accordance with GAAP, be
included on a consolidated statement of cash flows of the Borrower and its
Restricted Subsidiaries for such period as additions to property, plant and
equipment, Capital Lease Obligations or other capital expenditures; provided
that it is agreed that the Capital Expenditures of Unrestricted Subsidiaries
shall not be consolidated with those of the Borrower and its Restricted
Subsidiaries for purposes of calculating "Capital Expenditures."
"Capital Lease Obligations" of any Person shall mean the obligations of
such Person to pay rent or other amounts under any lease of (or other
arrangement conveying the right to use) real or personal property, or a
combination thereof, which obligations are required to be classified and
accounted for as capital leases on a balance sheet of such Person under GAAP (as
opposed to being accounted for as operating lease expenses on an income
statement of such Person under GAAP) and, for the purposes of this Agreement,
the amount of such obligations at any time shall be the capitalized amount
thereof at such time determined in accordance with GAAP.
"Capital Stock" of any Person shall mean any and all shares,
partnership, limited liability company and other interests (general or limited),
rights to purchase, warrants, options, participations or other equivalents of or
interests in (however designated) the equity of such Person.
"Cash Collateral Agreement" shall mean the Cash Collateral Agreement
dated as of December 13, 1995 among the Borrower, the Administrative Agent and
the Trustee, as amended from time to time.
"Cash Equivalents" shall mean:
(a) marketable obligations issued or unconditionally
guaranteed by the United States of America, or issued by any agency
thereof and backed by the full faith and credit of the United States,
in each case maturing within one year from the date of acquisition
thereof;
(b) marketable direct obligations issued by any state of the
United States of America or any political subdivision of any such state
or any public instrumentality thereof maturing within one year from the
date of acquisition thereof and having as at any
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date of determination the highest generic rating obtainable from either
Standard & Poor's Ratings Group or Xxxxx'x Investors Service, Inc.;
(c) commercial paper maturing no more than 270 days from the
date of creation thereof and having as at any date of determination one
of the two highest generic ratings obtainable from either Standard &
Poor's Ratings Group or Xxxxx'x Investors Service, Inc.;
(d) certificates of deposit maturing one year or less from the
date of acquisition thereof issued by commercial banks incorporated
under the laws of the United States of America or any state thereof or
the District of Columbia or Canada, (I) the commercial paper or other
short-term unsecured debt obligations of which are rated either A-2 or
better (or comparably if the rating system is changed) by Standard &
Poor's Ratings Group or Prime-2 or better (or comparably if the rating
system is changed) by Xxxxx'x Investors Service, Inc. or (II) the
long-term debt obligations of which are rated either AA- or better (or
comparably if the rating system is changed) by Standard & Poor's
Ratings Group or Aa3 or better (or comparably if the rating system is
changed) by Xxxxx'x Investors Service, Inc. ("Permitted Banks");
(e) bankers' acceptances eligible for rediscount under
requirements of the Board and accepted by Permitted Banks; and
(f) obligations of the type described in clause (a), (b), (c)
or (d) above purchased from a securities dealer designated as a
"primary dealer" by the Federal Reserve Bank of New York or from a
Permitted Bank as counterparty to a written repurchase agreement
obligating such counterparty to repurchase such obligations not later
than 14 days after the purchase thereof and which provides that the
obligations which are the subject thereof are held for the benefit of
the Borrower or a Subsidiary by a custodian which is a Permitted Bank
and which is not a counterparty to the repurchase agreement in
question.
"CERCLA" shall mean the Federal Comprehensive Environmental Response,
Compensation and Liability Act, as amended.
"Charges" shall have the meaning assigned to such term in Section 9.09.
"Class" shall have the meaning assigned to such term in Section 1.03.
"Closing" shall mean the time at which this Agreement shall become
effective.
"Closing Date" shall mean the date on which the Closing shall occur.
"Code" shall mean the Internal Revenue Code of 1986, as the same may be
amended from time to time.
"Collateral" shall mean all the collateral pledged or purported to be
pledged pursuant to any of the Collateral Documents.
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"Collateral Documents" shall mean the Security Agreements, the
Subsidiary Consent and Agreement, the General Partner Consent and Agreement, the
Public Partnership Consent and Agreement, the Motor Vehicle Security Agreements,
the Perfection Certificate, the Lockbox Agreements, the Mortgages, the Trust
Agreement, the Cash Collateral Agreement, checking and deposit account
agreements and all other security agreements and other documents and instruments
executed and/or delivered pursuant to the terms hereof or thereof (including the
certificates of title referred to in Section 4.01(c) of the Borrower Security
Agreement) in order to secure the Facility Obligations, other Parity Debt, and
the Existing Credit Agreement or perfect any Lien granted for the benefit of the
Lenders and the holders of Parity Debt pursuant thereto.
"Commitment" shall mean, with respect to each Lender, such Lender's
Revolving Credit Commitment and Term Loan Commitment.
"Commitment Fee" shall have the meaning assigned to such term in
Section 2.05(b).
"Commodities Inventory" shall mean all inventory consisting of propane
gas and other petroleum derivative products of, and held for sale by, the
Borrower or any Restricted Subsidiary.
"Commodity Hedging Agreement" shall mean any agreement or arrangement
designed solely to protect the Borrower and the Restricted Subsidiaries against
fluctuations in the price of propane with respect to quantities of propane that
the Borrower and the Restricted Subsidiaries reasonably expect to purchase from
suppliers, sell to their customers or need for their inventory during the period
covered by such agreement or arrangement.
"Consolidated Cash Flow" shall mean at any date of determination, for
the Reference Period with respect to such date of determination, (i) the sum of,
without duplication, the amounts for such period, taken as a single accounting
period, (a) Consolidated Net Income and (b) all amounts deducted in arriving at
such Consolidated Net Income in respect of (I) interest charges (including
amortization of debt discount and expense and imputed interest on Capital Lease
Obligations), (II) provisions for all taxes and reserves (including reserves for
deferred income taxes) and (III) non-cash items, including depreciation and
amortization, less (ii) without duplication, any non-cash items added in the
determination of such Consolidated Net Income for such period. Consolidated Cash
Flow shall be calculated after giving effect, on a pro forma basis for the
Reference Period with respect to any date of determination to, without
duplication, any asset sales or asset acquisitions (including any asset
acquisition giving rise to the need to make such calculation as a result of the
Borrower or any Restricted Subsidiary (including any Person who becomes a
Restricted Subsidiary as a result of such asset acquisition) incurring, assuming
or otherwise being liable for acquired Indebtedness) occurring during the period
commencing on the first day of such Reference Period to and including the date
of determination, as if such asset sale or asset acquisition occurred on the
first day of such Reference Period. The pro forma calculations required by this
definition will be determined in accordance with GAAP, shall be certified by a
Financial Officer of the Borrower, and shall be calculated in a manner
reasonably satisfactory to the Required Lenders; provided, however, that such
calculation shall be made (i) based on the historical sales volume associated
with any Eligible Propane Acquisition for the Reference Period with respect to
the date of such acquisition, less estimated post-acquisition loss
7
of sales volume (not to be less than three percent (3%)), (ii) based on the
actual cost to the Borrower of the volume of goods sold as determined in clause
(i) above, (iii) based on the pro forma expenses that would have been incurred
by the Borrower in the operation of such Eligible Propane Acquisition if it had
occurred on the first day of such period computed on the basis of personnel
expenses for employees retained or to be retained by the Borrower in the
operation of such Eligible Propane Acquisition and non-personnel costs and
expenses incurred by the Borrower or the General Partner in the operation of the
Business at similarly situated facilities of the Borrower and the Restricted
Subsidiaries, and (iv) without inclusion of the operations of any Unrestricted
Subsidiary.
"Consolidated Interest Expense" shall mean as of any date of
determination, the total amount payable by the Borrower and the Restricted
Subsidiaries on a consolidated basis (it being understood that amounts payable
by Unrestricted Subsidiaries shall not be consolidated with the Borrower or any
Restricted Subsidiary for purposes of calculating Consolidated Interest
Expense), during the Reference Period with respect to such date of
determination, in respect of all interest charges (including amortization of
debt discount and expense and imputed interest on actual payments under Capital
Lease Obligations) during such Reference Period with respect to Indebtedness of
the Borrower and the Restricted Subsidiaries.
"Consolidated Net Income" shall mean, with reference to any period, the
net income (or deficit) of the Borrower and its Restricted Subsidiaries for such
period (taken as a cumulative whole), after deducting all operating expenses,
provisions for all taxes and reserves (including reserves for deferred income
taxes) and all other proper deductions, all determined in accordance with GAAP
on a consolidated basis (it being understood that the net income of Unrestricted
Subsidiaries shall not be consolidated with the Borrower or any Restricted
Subsidiary for purposes of calculating Consolidated Net Income), after
eliminating all intercompany transactions and after deducting portions of income
properly attributable to minority interests, if any, in the stock and surplus of
Restricted Subsidiaries, provided that there shall be excluded (a) the income
(or deficit) of any Person accrued prior to the date it becomes a Restricted
Subsidiary or is merged into or consolidated with the Borrower or a Restricted
Subsidiary, (b) the income (or deficit) of any Person (other than a Restricted
Subsidiary) in which the Borrower or any Restricted Subsidiary has an ownership
interest, except to the extent that any such income has been actually received
by the Borrower or such Restricted Subsidiary in the form of dividends or
similar distributions (but subject to the limitations specified in the proviso
below), (c) the undistributed earnings of any Restricted Subsidiary to the
extent that the declaration or payment of dividends or similar distributions by
such Restricted Subsidiary is not at the time permitted by the terms of its
charter or any agreement, instrument, judgment, decree, order, statute, rule or
governmental regulation applicable to such Restricted Subsidiary, (d) any
restoration to income of any contingency reserve, except to the extent that
provision for such reserve was made out of income accrued during such period,
(e) any aggregate net gain (but not any aggregate net loss) during such period
arising from the sale, exchange or other disposition of capital assets (such
term to include all fixed assets, whether tangible or intangible, all inventory
sold in conjunction with the disposition of fixed assets, and all securities),
(f) any write-up of any asset, (g) any net gain from the collection of the
proceeds of life insurance policies, (h) any gain arising from the acquisition
of any securities, or the extinguishment, under GAAP, of any Indebtedness, of
the Borrower or any Restricted Subsidiary, (i) any net income or gain (but not
any net loss) during
8
such period from any change in accounting, from any discontinued operations or
the disposition thereof, from any extraordinary events or from any prior period
adjustments, (j) any deferred credit representing the excess of equity in any
Restricted Subsidiary at the date of acquisition over the cost of the investment
in such Restricted Subsidiary, and (k) in the case of a successor to the
Borrower by consolidation or merger or as a transferee of its assets, any
earnings of the successor corporation prior to such consolidation, merger or
transfer of assets; provided, further, that notwithstanding clause (b) above,
there shall be excluded in all events the income (or deficit) of Petro Holdings,
whether or not any amounts are actually received by the Borrower or any
Restricted Subsidiary from or through Petro Holdings in the form of dividends or
otherwise.
"Consolidated Pro Forma Debt Service" shall mean, as of any date of
determination, the total amount payable by the Borrower and the Restricted
Subsidiaries on a consolidated basis (it being understood that amounts payable
by Unrestricted Subsidiaries shall not be consolidated with the Borrower or any
Restricted Subsidiary for purposes of calculating Consolidated Pro Forma Debt
Service), during the four consecutive calendar quarters next succeeding the date
of determination, in respect of scheduled principal payments and all interest
charges (excluding amortization of debt discount and expense) with respect to
Indebtedness of the Borrower and the Restricted Subsidiaries outstanding on such
date of determination (other than all scheduled principal payments during any
such four consecutive calendar quarter period with respect to Funded Debt and
Facility B), after giving effect to any Indebtedness proposed to be incurred on
such date and to the substantially concurrent repayment of any other
Indebtedness, and (a) including actual payments under Capital Lease Obligations,
(b) assuming, in the case of Indebtedness (other than Indebtedness incurred
under the Existing Credit Agreement and the Facility) bearing interest at
fluctuating interest rates which cannot be determined in advance, that the rate
in effect on such date will remain in effect throughout such period, (c)
assuming in the case of Indebtedness incurred under the Existing Credit
Agreement and/or the Facility, that (i) the interest payments payable during
such four consecutive calendar quarters next succeeding the date of
determination will equal the actual interest payments associated with the
Existing Credit Agreement or the Facility, as the case may be, during the most
recent four fiscal quarters, (ii) except for the twelve month period immediately
prior to the termination or final maturity thereof (unless extended or renewed),
no principal payments will be made under Facility A of the Existing Credit
Agreement and (iii) principal payments relating to Facility B and the Facility
will become due based on the assumption that the conversion to the fixed
amortization schedule pursuant to Sections 2.01(c) and 2.11(c) of the Existing
Credit Agreement and Sections 2.01(c) and 2.11(c) of this Agreement, as
applicable, (d) treating the principal amount of all Indebtedness outstanding as
of such date of determination under a revolving credit or similar agreement
(other than the Existing Credit Agreement and this Agreement) as maturing and
becoming due and payable on the scheduled maturity date or dates thereof
(including the maturity of any payment required by any commitment reduction or
similar amortization provision), without regard to any provision permitting such
maturity date to be extended, (e) including any other debt repayments due within
twelve months from such date of determination and (f) excluding principal and
interest payments in connection with the Star/Petro Intercompany Subordinated
Debt.
"Control" shall mean the possession, directly or indirectly, of the
power to direct or cause the direction of the management or policies of a
Person, whether through the ownership of voting
9
securities, by contract or otherwise, and "Controlling" and "Controlled" shall
have meanings correlative thereto.
"Conversion Date" shall mean September 30, 2003.
"Current Assets" shall mean, as of any date, all assets which would, in
accordance with GAAP, be included on a consolidated balance sheet of the
Borrower and its Restricted Subsidiaries as of such date as current assets;
provided that it is understood that the current assets of Unrestricted
Subsidiaries shall not be consolidated with those of the Borrower or any
Restricted Subsidiary for purposes of calculating Current Assets.
"Current Liabilities" shall mean, as of any date, without duplication,
(a) all liabilities which would, in accordance with GAAP, be included on a
consolidated balance sheet of the Borrower and its Restricted Subsidiaries as of
such date as current liabilities; provided that it is understood that the
current liabilities of Unrestricted Subsidiaries shall not be consolidated with
those of the Borrower or any Restricted Subsidiary for purposes of calculating
Current Liabilities and (b) all Indebtedness as of such date in respect of
Facility A.
"Current Value" shall have the meaning assigned to such term in Section
6.22.
"Default" shall mean any event or condition which upon notice, lapse of
time or both would constitute an Event of Default.
"Disqualified Stock" of any Person shall mean any Capital Stock of such
Person which by its terms (or by the terms of any security into which it is
convertible or for which it is exchangeable or exercisable), upon the happening
of any event or otherwise (a) matures or is mandatorily redeemable or subject to
any mandatory repurchase requirement, pursuant to a sinking fund obligation or
otherwise, (b) is convertible into or exchangeable or exercisable for
Indebtedness or Disqualified Stock or (c) is redeemable or subject to any
mandatory repurchase requirement at the option of the holder thereof, in whole
or in part, in each case on or prior to the first anniversary of the Maturity
Date.
"Documentation Agent" shall mean Bank of America, N.A., in its capacity
as documentation agent for the Lenders hereunder, and its successors in such
capacity.
"dollars" or "$" shall mean lawful money of the United States of
America.
"Eligible Propane Acquisitions" shall mean acquisitions by the Borrower
or any Restricted Subsidiary of controlling stock or all or any part of the
assets of Persons primarily engaged in the distribution of propane and,
incidental thereto, propane appliances, within the continental United States of
America; provided, that, any acquisition made by an Unrestricted Subsidiary
shall not constitute an Eligible Propane Acquisition. A Person shall be
"primarily engaged" in the distribution of propane and propane appliances within
the continental United States of America in the event that at least eighty-five
(85%) of its annual gross revenue is derived from such distribution activities.
10
"Environmental Laws" shall mean the common law and all Federal, state,
local and foreign laws, rules or regulations relating to pollution or protection
of public health, safety or the environment, including laws relating to (a)
emissions, discharges, releases or threatened releases of any Hazardous Material
into the environment (including air, surface water, ground water or land) or (b)
the manufacture, processing, distribution, use, treatment, storage, disposal,
transport or handling of Hazardous Materials.
"ERISA" shall mean the Employee Retirement Income Security Act of 1974,
as the same may be amended from time to time.
"Eurodollar Borrowing" shall mean a Borrowing comprised of Eurodollar
Loans.
"Eurodollar Loan" shall mean any Eurodollar Revolving Loan or
Eurodollar Term Loan.
"Eurodollar Revolving Loan" shall mean any Revolving Loan bearing
interest at a rate determined by reference to the Adjusted LIBO Rate in
accordance with the provisions of Article II.
"Eurodollar Term Borrowing" shall mean a Borrowing comprised of
Eurodollar Term Loans.
"Eurodollar Term Loan" shall mean any Term Loan bearing interest at a
rate determined by reference to the Adjusted LIBO Rate in accordance with the
provisions of Article II.
"Event of Default" shall have the meaning assigned to such term in
Article VII.
"Excess Proceeds" shall mean the meaning specified in Section
6.07(c)(iii)(B).
"Exchange Act" shall mean the Securities Exchange Act of 1934, as
amended, and the rule and regulations promulgated thereunder.
"Existing Credit Agreement" shall mean that certain Credit Agreement
dated as of December 13, 1995 among the Borrower, the lenders party thereto from
time to time, Fleet National Bank (formerly BankBoston, N.A., formerly The First
National Bank of Boston), as administrative agent, and Bank of America, N.A.
(formerly NationsBank, N.A.), as documentation agent, as amended through the
Twelfth Amendment and as amended thereafter from time to time, provided, that in
the event such Credit Agreement expires or is terminated the term "Existing
Credit Agreement" as used herein shall mean such Credit Agreement in the form in
which it was in effect immediately prior to such expiration or termination,
provided that nothing in the immediately preceding proviso shall be construed as
an agreement or permission that the Existing Credit Agreement can expire or be
terminated prior to this Agreement.
"Existing Unmortgaged Property" shall have the meaning assigned to such
term in Section 6.22.
11
"Facility" shall mean the Revolving Loans, the Letters of Credit and
the Term Loans provided or participated in by the Lenders to the Borrower
pursuant to this Agreement and the other Loan Documents.
"Facility A" shall have the meaning assigned to such term in the
Existing Credit Agreement.
"Facility B" shall have the meaning assigned to such term in the
Existing Credit Agreement.
"Facility Obligations" shall mean (a) the Borrower's obligations in
respect of the due and punctual payment of principal of and interest on the
Loans and all amounts drawn under the Letters of Credit, when and as due,
whether at maturity, by acceleration, upon one or more dates set for prepayment
or otherwise, (b) all Fees, expenses, indemnities and expense reimbursement
obligations of the Borrower under this Agreement or any other Loan Document, (c)
all obligations of the Borrower to any Agent or Lender under any Interest Rate
Agreement and (d) all other obligations, monetary or otherwise, of the Borrower
or any other Loan Party under any Loan Document to which it is a party, in each
case, whether now owing or hereafter existing.
"Federal Funds Effective Rate" shall mean, for any day, the rate equal
to the weighted average (rounded upwards to the nearest 1/8%) of the rates on
overnight federal funds 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 Business Day, for the immediately preceding
Business Day) by the Federal Reserve Bank of New York or (b) if such rate is not
so published for such Business Day, as determined by the Administrative Agent
using any reasonable means of determination. Each determination by the
Administrative Agent of the Federal Funds Effective Rate shall, in the absence
of manifest error, be conclusive.
"Fees" shall mean the fees payable pursuant to Section 2.05 and the
Letter of Credit Fees.
"Financial Officer" shall mean, as to any corporation, the chief
financial officer or principal accounting officer of such corporation and, as to
any partnership, an officer of its managing general partner who would qualify as
a Financial Officer of such general partner hereunder.
"Fleet Parity Note" shall mean the Parity Promissory Note dated October
23, 2001 issued by Borrower in favor of Fleet National Bank.
"Funded Debt", as applied to any Person, shall mean all Indebtedness of
such Person which by its terms or by the terms of any instrument or agreement
relating thereto matures more than one year from the date of the initial
creation thereof (including any current installment thereof due within one year
of the date of determination); provided that Funded Debt shall include any
Indebtedness which does not otherwise come within the foregoing definition but
which is directly or indirectly renewable or extendible at the option of the
debtor to a date one year or more (including an option of the debtor under a
revolving credit or similar agreement obligating the lender or lenders to extend
credit over a period of one year or more) from the date
12
of the initial creation thereof; provided, further, that Funded Debt shall not
include intercompany Indebtedness permitted pursuant to Section 6.01(d).
"GAAP" shall mean generally accepted accounting principles in effect in
the United States from time to time.
"General Partner" shall mean Star Gas LLC or, after an Involuntary
Removal, any Person which replaces Star Gas LLC as sole general partner of the
Borrower and the Public Partnership in a Qualifying Involuntary Removal.
"General Partner Consent and Agreement" shall mean the General Partner
Consent and Agreement dated as of the date hereof among the General Partner and
the Trustee as to the consent and agreement of the General Partner in connection
with the General Partner Guarantee and the Partners Security Agreement, in the
form attached hereto as Exhibit B-1, as amended from time to time.
"General Partner Guarantee Agreement" shall mean the Guarantee
Agreement between the General Partner and the Administrative Agent dated as of
March 25, 1999, as amended from time to time.
"Governmental Authority" shall mean any Federal, state, local or
foreign governmental department, commission, board, bureau, authority, agency,
court, instrumentality or judicial or regulatory body or entity.
"Growth-Related Capital Expenditures" shall mean, with respect to any
Person, all capital expenditures by such Person made to improve or enhance the
existing capital assets or to increase the customer base of such Person or to
acquire or construct new capital assets (but excluding capital expenditures made
to maintain, up to the level thereof that existed at the time of such
expenditure, the operating capacity of the capital assets of such Person as such
assets existed at the time of such expenditure).
"Guaranty", as applied to any Person, shall mean any direct or indirect
liability, contingent or otherwise, of such Person with respect to any
indebtedness, lease, dividend or other obligation of another, including any such
obligation directly or indirectly guaranteed, endorsed (otherwise than for
collection or deposit in the ordinary course of business) or discounted or sold
with recourse by such Person, or in respect of which such Person is otherwise
directly or indirectly liable or any other obligation under any contract which,
in economic effect, is substantially equivalent to a guaranty, including any
such obligation of a partnership in which such Person is a general partner or of
a joint venture in which such Person is a joint venturer, and any such
obligation in effect guaranteed by such Person through any agreement (contingent
or otherwise) to purchase, repurchase or otherwise acquire such obligation or
any security therefor, or to provide funds for the payment or discharge of such
obligation (whether in the form of loans, advances, stock purchases, capital
contributions or otherwise), or to maintain the solvency or any balance sheet or
other financial condition of the obligor of such obligation, or to make payment
for any products, materials or supplies or for any transportation or services
regardless of the non-delivery or nonfurnishing thereof, in any such case if the
purpose or intent of such
13
agreement is to provide assurance that such obligation will be paid or
discharged, or that any agreements relating thereto will be complied with, or
that the holders of such obligation will be protected against loss in respect
thereof.
"Guarantee Agreements" shall mean the General Partner Guarantee
Agreement and the Subsidiaries Guarantee Agreement.
"Hazardous Materials" shall mean any toxic or hazardous substance or
waste, gasoline or petroleum (including crude oil or any fraction thereof) or
petroleum products, polychlorinated biphenyls, urea-formaldehyde insulation,
asbestos or asbestos-containing materials, pollutants, contaminants,
radioactivity, and any other materials or substances of any kind, whether or not
any such substance is defined as hazardous under any Environmental Law, that is
regulated pursuant to any Environmental Law or that could give rise to liability
under any Environmental Law.
"Hedging Agreement" shall mean any interest rate swap, collar, cap or
similar interest rate arrangement designed solely to protect the Borrower
against fluctuations in interest rates on Indebtedness outstanding or committed
under the Facility.
"Indebtedness", as applied to any Person, shall mean the following
(without duplication):
(a) any indebtedness for borrowed money which such Person has
directly or indirectly created, incurred or assumed;
(b) any indebtedness, whether or not for borrowed money, with
respect to which such Person has become directly or indirectly liable
and which represents the deferred purchase price (or a portion thereof)
or has been incurred to finance the purchase price (or a portion
thereof) of any property or service or business acquired by such
Person, whether by purchase, consolidation, merger or otherwise;
(c) all obligations evidenced by notes, bonds, debentures or
similar instruments, including obligations so evidenced incurred in
connection with the acquisition or property, assets or businesses, and
all obligations upon which interest charges are customarily paid;
(d) all indebtedness created or arising under any conditional
sale or other title retention agreement, or incurred as financing, in
either case with respect to property acquired by the Person (even
though the rights and remedies of the seller or bank under such
agreement in the event of default are limited to repossession or sale
of such property);
(e) any Capital Lease Obligations to the extent such
obligations would, in accordance with GAAP, appear on a balance sheet
of such Person;
(f) any indebtedness, whether or not for borrowed money,
secured by (or for which the holder of such Indebtedness has an
existing right, contingent or otherwise, to be secured by) any Lien in
respect of property owned by such Person, whether or not
14
such Person has assumed or become liable for the payment of such
indebtedness, provided that the amount of such Indebtedness if not so
assumed shall in no event be deemed to be greater than the fair market
value from time to time (as determined in good faith by such Person) of
the property subject to such Lien;
(g) all Disqualified Stock of such Person valued at the
greater of its voluntary or involuntary maximum fixed repurchase price
plus accrued dividends;
(h) any Preferred Stock of any Subsidiary of such Person
valued at the sum of the liquidation preference thereof or any
mandatory redemption payment obligations in respect thereof plus, in
either case, accrued dividends thereon;
(i) any indebtedness of the character referred to in clause
(a) through (h) of this definition deemed to be extinguished under GAAP
but for which such Person remains legally liable;
(j) all obligations of such Person in respect of Interest Rate
Agreements; and
(k) all standby letters of credit (including the Letters of
Credit) of such Person and any indebtedness of any other Person of the
character referred to in clause (a) through (i) of this definition with
respect to which the Person whose Indebtedness is being determined has
become liable by way of a Guaranty.
Notwithstanding the foregoing, in determining the Indebtedness of the Borrower
and the Restricted Subsidiaries, there shall be excluded all undrawn commercial
letters of credit (not yet due and payable), trade accounts payable, accrued
interest and other accrued expenses and customer credit balances arising in the
ordinary course of business on ordinary terms. The Indebtedness of any Person
shall include the Indebtedness of any partnership in which such Person is a
general partner.
"Indemnified Party" shall have the meaning assigned to such term in
Section 9.05(b).
"Intercompany Notes" shall mean the promissory notes of the
Subsidiaries issued to the Borrower as contemplated by Sections 4.01(e)(iii) and
6.01(c), in the form attached hereto as Exhibit D or such other form as may be
satisfactory to the Administrative Agent, representing all Indebtedness of the
Subsidiaries to the Borrower incurred pursuant to this Agreement outstanding at
any time.
"Interest Payment Date" shall mean, with respect to any Loan, the last
day of the Interest Period applicable to the Borrowing of which such Loan is a
part and, in the case of any Eurodollar Borrowing with an Interest Period of
more than three months' duration, each day that would have been an Interest
Payment Date had successive Interest Periods of three months' duration been
applicable to such Borrowing and, in addition, in the case of any Eurodollar
Borrowing, the date of any refinancing or conversion of such Borrowing with or
to a Borrowing of a different Type.
15
"Interest Period" shall mean (a) as to any Eurodollar Borrowing, the
period commencing on the date of such Borrowing or on the last day of the
immediately preceding Interest Period applicable to such Borrowing, as the case
may be, and ending on the numerically corresponding day (or, if there is no
numerically corresponding day, on the last day) in the calendar month that is 1,
2, 3 or 6 months thereafter, as the Borrower may elect, and (b) as to any ABR
Borrowing, the period commencing on the date of such Borrowing or on the last
day of the immediately preceding Interest Period applicable to such Borrowing,
as the case may be, and ending on the earliest of (i) the last day of the
current month and (ii) with respect to any Revolving Loan or Term Loan, the
Conversion Date or the Maturity Date, respectively; provided, however, that if
any Interest Period would end on a day other than a Business Day, such Interest
Period shall be extended to the next succeeding Business Day unless, in the case
of a Eurodollar Borrowing only, such next succeeding Business Day would fall in
the next calendar month, in which case such Interest Period shall end on the
next preceding Business Day. Interest shall accrue from and including the first
day of an Interest Period to, but excluding, the last day of such Interest
Period.
"Interest Rate Agreement" shall mean any interest rate swap, collar,
cap, foreign currency exchange agreement or other arrangement requiring payments
contingent upon interest or exchange rates.
"Inventory" shall mean Commodities Inventory and Non-Commodities
Inventory.
"Investment", as applied to any Person, shall mean any direct or
indirect purchase or other acquisition by such Person of stock or other
securities of any other Person, or any direct or indirect loan, advance or
capital contribution by such Person to any other Person, and any other item
which would be classified as an "investment" on a balance sheet of such Person
prepared in accordance with GAAP, including any direct or indirect contribution
by such Person of property or assets to a joint venture, partnership or other
business entity in which such Person retains an interest. For the purposes of
Section 6.03, the amount involved in Investments made during any period shall be
the aggregate cost to the Borrower of all such Investments made during such
period, determined in accordance with GAAP, but without regard to unrealized
increases or decreases in value, or write-ups, write-downs or write-offs, of
such investments and without regard to the existence of any undistributed
earnings or accrued interest with respect thereto accrued after the respective
dates on which such Investments were made, less any net return of capital
realized during such period upon the sale, repayment or other liquidation of
such Investment (determined in accordance with GAAP, but without regard to any
amounts received during such period as earnings (in the form of dividends not
constituting a return of capital, interest or otherwise) on such Investment) or
as loans from any Person in whom such Investments have been made.
"Involuntary Removal" shall mean an involuntary removal of the General
Partner as the general partner of the Borrower pursuant to Section 12.2 of the
Partnership Agreement or as the general partner of the Public Partnership
pursuant to Section 13.2 of the MLP Agreement.
"Issuing Bank" shall mean, as to any Letter of Credit, Fleet National
Bank, in its capacity as the issuer of such Letter of Credit, and its successors
in such capacity.
16
"Legal Requirement" shall mean any law, statute, ordinance, decree,
requirement, order, judgment, rule or regulation (or published official
interpretation by any Governmental Authority of any of the foregoing) of any
Governmental Authority.
"Lender" shall mean each financial institution listed on the signature
pages hereof, each assignee which becomes a Lender pursuant to Section 9.04(b),
and their respective successors.
"Letter Agreement" shall have the meaning set forth in Section 2.05(c).
"Letter of Credit Exposure" shall mean at any time the sum of (i) the
aggregate undrawn amount of all outstanding Letters of Credit, plus (ii) the
aggregate amount of all Letter of Credit Disbursements not yet reimbursed by the
Borrower as provided in Section 2.21, minus (iii) the aggregate principal amount
of cash collateral in respect of Letters of Credit deposited by the Borrower
with the Administrative Agent and held pursuant to the Cash Collateral
Agreement. The Letter of Credit Exposure of any Lender at any time shall mean
its pro rata share (based on such Lender's Revolving Credit Commitment
Percentage) of the aggregate Letter of Credit Exposure at such time.
"Letter of Credit Fees" shall mean the fees payable to the Issuing Bank
and the Lenders in respect of Letters of Credit pursuant to Section 2.21(f).
"Letters of Credit" shall mean any and all standby letters of credit
issued pursuant to Section 2.21(b).
"Letter of Credit Disbursement" shall mean a payment or disbursement
made my the Issuing Bank pursuant to a Letter of Credit.
"Level I Pricing Period" shall mean, subject to Section 2.06(e), any
period during which the Leverage Ratio is less than 3.50:1.00 and no Event of
Default has occurred and is continuing.
"Level II Pricing Period" shall mean, subject to Section 2.06(e), any
period during which the Leverage Ratio is greater than or equal to 3.50:1.00 but
less than 4.00:1.00 and no Event of Default has occurred and is continuing.
"Level III Pricing Period" shall mean, subject to Section 2.06(e), any
period which is not a Level I Pricing Period or a Level II Pricing Period.
"Leverage Ratio" as of any date shall mean the ratio of (a) Total
Funded Debt as of the last day of the Reference Period with respect to such date
to (b) Consolidated Cash Flow for such Reference Period.
"LIBO Rate" shall mean, with respect to any Eurodollar Borrowing for
any Interest Period, the rate of interest at which dollar deposits (a) in a
non-United States office or an international banking facility of the
Administrative Agent, (b) in an amount comparable to the principal amount of the
Administrative Agent's portion of such Eurodollar Borrowing and (c) which has a
term corresponding to such Interest Period are offered to the Administrative
Agent by first class banks in the inter-bank eurodollar market for delivery in
immediately available
17
funds at such non-United States office or international banking facility of the
Administrative Agent (as the Administrative Agent may from time to time select)
on the first day of such Interest Period as determined by the Administrative
Agent at approximately 10:00 a.m. (Boston time) two Business Days prior to the
date upon which such Interest Period is to commence (which determination by the
Administrative Agent shall, in the absence of manifest error, be conclusive).
"Lien", as to any Person, shall mean any mortgage, lien (statutory or
otherwise), pledge, reservation, right of entry, encroachment, easement, right
of way, restrictive covenant, license, charge, security interest or other
encumbrance in or on, or any interest or title of any vendor, lessor, lender or
other secured party to or of such Person under any conditional sale or other
title retention agreement or Capital Lease Obligation with respect to, any
property or asset owned or held by such Person, or the signing or filing of a
financing statement with respect to any of the foregoing which names such Person
as debtor, or the signing of any security agreement with respect to any of the
foregoing authorizing any other party as the secured party thereunder to file
any financing statement or any other agreement to give or grant any of the
foregoing. For the purposes of this Agreement, a Person shall be deemed to be
the owner of any asset which it has placed in trust for the benefit of the
holders of Indebtedness of such Person and such trust shall be deemed to be a
Lien if such Person remains legally liable therefor, notwithstanding that such
Indebtedness is or may be deemed to be extinguished under GAAP.
"Loan Documents" shall mean (a) this Agreement, (b) the Notes, (c) the
Letters of Credit, (d) the Guarantee Agreements, (e) the Intercompany Notes, (f)
the Collateral Documents, (g) any Interest Rate Agreements entered into by the
Borrower with any Agent or Lender, (h) any Supplemental Agreements.
"Loan Parties" shall mean the Public Partnership, the General Partner,
the Borrower and the Restricted Subsidiaries.
"Loans" shall mean any or all of the Revolving Loans and the Term
Loans.
"Lockbox Agreement" shall mean an agreement among any Lender or other
bank, the Borrower or any Restricted Subsidiary, and the Administrative Agent in
substantially the form attached as Exhibit F to the Existing Credit Agreement.
"Make Whole Amount" shall have the meaning set forth in the Note
Agreement as in effect on the Closing Date.
"Margin Stock" shall have the meaning assigned to such term under
Regulation U.
"Material Adverse Effect" shall mean a material adverse effect on (a)
the business, operations, property or condition (financial or otherwise) of the
Borrower or the Business, (b) the ability of the Borrower, the General Partner
or any Restricted Subsidiary to perform its obligations under this Agreement or
any other Operative Agreement or (c) the validity, enforceability, perfection or
priority of this Agreement or any other Operative Agreement or of the rights or
remedies of any Lender or the Trustee.
18
"Material Contract" shall mean any "material contract" (within the
meaning of Item 601(b)(10) of Regulation S-K under the Exchange Act).
"Maturity Date" shall mean September 30, 2005.
"Maximum Consolidated Pro Forma Debt Service" shall mean, as of any
date of determination, the highest total amount payable by the Borrower and the
Restricted Subsidiaries on a consolidated basis (it being understood that
amounts payable by Unrestricted Subsidiaries shall not be consolidated with the
Borrower or any Restricted Subsidiary for purposes of calculating Maximum
Consolidated Pro Forma Debt Service), during any period of four consecutive
fiscal quarters, commencing with the fiscal quarter in which such date of
determination occurs and ending on the maturity date of the Mortgage Notes, in
respect of scheduled principal payments and all interest charges with respect to
all Indebtedness of the Borrower and the Restricted Subsidiaries (other than all
scheduled principal payments with respect to Facility B only to the extent that
the outstanding principal amount of Facility B is zero for a period of at least
30 consecutive days during the two-year period prior to any such date of
determination) outstanding or to be outstanding, after giving effect to any
Indebtedness proposed to be incurred on such date and to the substantially
concurrent repayment of any other Indebtedness, and (a) including actual
payments under Capital Lease Obligations, (b) assuming, in the case of
Indebtedness (other than Indebtedness incurred under the Existing Credit
Agreement and the Facility) bearing interest at fluctuating interest rates which
cannot be determined in advance, that the rate in effect on such date will
remain in effect throughout such period, (c) assuming in the case of
Indebtedness incurred under the Existing Credit Agreement and the Facility, that
(i) the interest payments payable during such four consecutive calendar quarters
next succeeding the date of determination will equal the actual interest
payments associated with the Existing Credit Agreement or the Facility, as the
case may be, during the most recent four fiscal quarters, (ii) except for the
twelve-month period immediately prior to the termination or final maturity
thereof (unless extended or renewed) no principal payments will be made under
Facility A of the Existing Credit Agreement and (iii) principal payments
relating to Facility B and the Facility will become due based on the assumption
that the conversion to the fixed amortization schedule is exercised pursuant to
Sections 2.01(c) and 2.11(c) of the Existing Credit Agreement and Sections
2.01(c) and 2.11(c) of this Agreement as applicable, (d) treating the principal
amount of all Indebtedness outstanding as of such date of determination under a
revolving credit or similar agreement (other than the Existing Credit Agreement
and the Facility) as maturing and becoming due and payable on the scheduled
maturity date or dates thereof (including the maturity of any payment required
by any commitment reduction or similar amortization provision), without regard
to any provision permitting such maturity date to be extended, (e) including any
other debt repayments due within twelve months from such date of determination
and (f) excluding principal and interest payments in connection with the
Star/Petro Intercompany Subordinated Debt.
"Maximum Rate" shall have the meaning assigned to such term in Section
9.09.
"MLP Agreement" shall mean the Agreement of Limited Partnership of the
Public Partnership.
19
"Mortgage" shall mean each mortgage, assignment of rents, security
agreement and fixture filing, or deed of trust, assignment of rents and fixture
filing, or similar instrument creating and evidencing a lien on a real property
and other property and rights incidental thereto, which shall be substantially
in the form of Exhibit G to the Existing Credit Agreement, containing such
schedules and including such exhibits as shall not be inconsistent with the
provisions of Section 4.01(d) or shall be necessary to conform such instrument
to applicable local law and which shall be dated the date of delivery thereof
and made by the owner of the real property described therein for the benefit of
the Trustee, as mortgagee (or beneficiary), assignee and secured party for the
benefit of the Secured Parties, as the same may be amended from time to time.
"Mortgage Notes" shall mean the mortgage notes of the Borrower in the
aggregate principal amount of $85,000,000 issued pursuant to the Note Agreement.
"Mortgaged Properties" shall mean the real properties identified on
Schedule 6.19 and each other real property subjected to a Mortgage under Section
6.22 or otherwise.
"Motor Vehicle Security Agreements" shall mean the Security Agreements
for Motor Vehicles and other Rolling Stock between the Borrower or the
Restricted Subsidiary, as applicable, and the Trustee in the form of Exhibit D
to the Borrower Security Agreement, as amended from time to time.
"Multiemployer Plan" shall mean a Plan which is a multiemployer plan as
defined in Section 4001(a)(3) of ERISA.
"Net Working Capital" as of any date shall mean the lesser of (a) (i)
Current Assets as of such date, minus (ii) Current Liabilities as of such date
and (b) $8,000,000.
"1998 Parity Notes" shall mean the $11,000,000 7.23% First Mortgage
Notes due September 15, 2010 issued by the Borrower pursuant to the Note
Agreement dated as January 22, 1998 among the Borrower and the investors named
therein, as amended by the First Amendment to Note Agreement dated as of March
25, 1999 and the Second Amendment to Note Agreement dated as of September 30,
2000.
"Non-Commodities Inventory" shall mean new household appliances, new
parts inventory and new supplies inventory which are held for sale by the
Borrower or its Restricted Subsidiaries in the normal course of business and
which, upon sale, will qualify for the full term of the original manufacturer's
warranty, if any.
"Non-Excluded Taxes" shall have the meaning assigned to such term in
Section 2.19.
"Note" shall mean a promissory note of the Borrower, substantially in
the form of Exhibit A, evidencing Revolving Loans and (after the Conversion
Date) Term Loans, and any substitutions or replacements therefor.
"Note Agreement" shall mean the Note Purchase Agreement dated as of
December 13, 1995 among Star Gas Corporation, the Borrower and the investors
named therein.
20
"Officers' Certificate" shall mean, as to any corporation, a
certificate executed on its behalf by the Chairman of the Board of Directors (if
an officer) or its President or one of its Vice Presidents and its Treasurer, or
Controller, or one of its Assistant Treasurers or Assistant Controllers, and, as
to any partnership, a certificate executed on behalf of such partnership by its
general partner in a manner which would qualify such certificate as an Officers'
Certificate of such general partner hereunder.
"Operative Agreements" shall mean this Agreement, the Note Agreement,
the Collateral Documents, the MLP Agreement and the Partnership Agreement.
"Parity Debt" shall mean Indebtedness of the Borrower incurred in
accordance with Sections 6.01(a), 6.01(b), 6.01(f), 6.01(k) (but only to the
extent such Indebtedness under Section 6.01(k) is incurred to any Lender) or
6.01(i) and secured by the lien of the Collateral Documents in accordance with
Section 6.02(g) or 6.02(h). For purposes of clarification, Parity Debt includes
the 1998 Parity Notes, the 2000 Parity Notes and the 2001 Parity Notes.
"Parity Debt Agreements" shall have the meaning set forth in the Trust
Agreement.
"Partners Security Agreement" shall mean the Amended and Restated
Pledge and Security Agreement among the Public Partnership, the General Partner
and the Trustee dated as of March 25, 1999, as amended from time to time.
"Partnership Agreement" shall mean the Agreement of Limited Partnership
of the Borrower, as in effect on March 25, 1999, and as the same may from time
to time be amended, modified or supplemented in accordance with the terms
thereof and Section 6.12 hereof.
"PBGC" shall mean the Pension Benefit Guaranty Corporation established
pursuant to Subtitle A of Title IV of ERISA or any successor thereto.
"Perfection Certificate" shall mean a certificate from the Borrower
substantially in the form of Exhibit G.
"Permitted Exceptions" shall have the meaning set forth in Section
3.26.
"Permitted Insurers" shall mean insurers with ratings of A or better
according to Best's Insurance Reports (or a comparable rating agency for
insurance companies located outside of the United States and Canada) and with
assets of no less than $500 million.
"Person" shall mean any natural Person, corporation, business trust,
joint venture, association, company, limited liability company, partnership,
government (or any agency or political subdivision thereof) or other entity.
"Petro" shall mean Petroleum Heat and Power Co., Inc., a Minnesota
corporation.
"Petro Holdings" shall mean, collectively, Petro Holdings, Inc., a
Minnesota corporation, and its subsidiaries.
21
"Petro Holdings Dividends" shall mean the cash dividends or
distributions actually received by the Borrower or a Restricted Subsidiary from
Petro Holdings with respect to a calendar quarter during the 45 days immediately
following any such calendar quarter.
"Plan" shall mean an "employee benefit plan" (as defined in Section 3
(3) of ERISA) subject to Title IV of ERISA which is or has been established or
maintained, or to which contributions are or have been made, by Star Gas
Corporation, in its former capacity as general partner of the Borrower, the
General Partner, the Borrower or any Related Person or to which Star Gas
Corporation, in its former capacity as general partner of the Borrower, the
General Partner, the Borrower or any Related Person is or has been obligated to
contribute, or an employee benefit plan as to which Star Gas Corporation, in its
former capacity as general partner of the Borrower, the General Partner, the
Borrower or any Related Person could be treated as a contributory sponsor under
Section 4069 or Section 4212 of ERISA if such plan were terminated.
"Preferred Stock", as applied to the Capital Stock of any Person, shall
mean Capital Stock of any class or classes (however designated) which is
preferred as to the payment of dividends, or as to the distribution of assets
upon any voluntary or involuntary liquidation or dissolution of such
corporation, over shares of Capital Stock of any other class of such Person.
"Prime Rate" shall mean the rate of interest per annum adopted from
time to time by the Administrative Agent as its Base Rate (which may not be the
lowest rate at which the Administrative Agent makes loans to borrowers) in
effect at its principal office in Boston, Massachusetts. Each change in the
Prime Rate shall be effective on the date such change is adopted, without notice
to the Borrower.
"Public Partnership" shall mean Star Gas Partners, L.P., a Delaware
limited partnership.
"Public Partnership Consent and Agreement" shall mean the Public
Partnership Consent and Agreement dated as of the date hereof among the Public
Partnership and Trustee as to the consent and agreement of the Public
Partnership in connection with the Partners Security Agreement, in the form
attached hereto as Exhibit B-2, as amended from time to time.
"Qualifying Involuntary Removal" shall mean any Involuntary Removal;
provided that (a) (i) the Person which shall become the general partner of the
Borrower and the Public Partnership shall be satisfactory to the Required
Lenders in their sole discretion or (b) (i) the ratio of (A) Total Funded Debt
as of the last day of the Reference Period with respect to the date of removal
of the predecessor general partner to (B) Consolidated Cash Flow for such
Reference Period shall be no greater than 4.25:1.00, (ii) the ratio of
Consolidated Cash Flow to Maximum Consolidated Pro Forma Debt Service for such
Reference Period will be greater than 1.25:1.00 and (iii) within 60 days after
such Involuntary Removal, the successor general partner (which shall be a
corporation organized and existing under the laws of the United States of
America or any State thereof) shall expressly assume, by a written agreement
executed and delivered to the Trustee, in form satisfactory to the Trustee and
the Required Lenders, all the obligations of the "General Partner" under this
Agreement and the other Loan Documents.
22
"RCRA" shall mean the Federal Resource Conservation and Recovery Act,
as amended.
"Reference Period" with respect to any date of determination shall mean
the period of four consecutive fiscal quarters of the Borrower most recently
completed at least 45 days prior to such date, except that in connection with
any calculation required pursuant to Section 6.04, the "Reference Period" with
respect to any date of determination shall mean the period of four consecutive
fiscal quarters of the Borrower immediately preceding, or ending on, such date
of determination.
"Register" shall have the meaning assigned to such term in Section
9.04(d).
"Regulation T" shall mean Regulation T of the Board as from time to
time in effect and all official rulings and interpretations thereunder or
thereof.
"Regulation U" shall mean Regulation U of the Board as from time to
time in effect and all official rulings and interpretations thereunder or
thereof.
"Regulation X" shall mean Regulation X of the Board as from time to
time in effect and all official rulings and interpretations thereunder or
thereof.
"Related Person" shall mean any trade or business, whether or not
incorporated, which, as of any date of determination, would be treated as a
single employer together with the General Partner or the Borrower under Section
414 of the Code.
"Repayment Date" shall have the meaning assigned to such term in
Section 2.11(c).
"Reportable Event" shall mean any of the events set forth in Section
4043(b) of ERISA, other than those events as to which the 30-day notice period
is waived under subsections .13, .14, .16, .18, .19 or .20 of PBGC Reg. ss.2615.
"Required Lenders" shall mean, at any time, Lenders holding Loans and
participations in Letters of Credit, and having Commitments, representing in the
aggregate at least 66-2/3% of the sum at such time of (a) the aggregate
principal amount of the Loans outstanding, (b) the aggregate amount of the
Letter of Credit Exposure and (c) the aggregate amount of unused Commitments.
"Responsible Officer" shall mean the President, any Vice President, the
Chief Financial Officer, the Treasurer and the Secretary of the General Partner
and any other officer of the General Partner who is responsible for compliance
with or performance of any obligation under this Agreement or the other
Operative Agreements and any employee of the Borrower performing any of the
above functions.
"Restricted Payment" shall mean (a) any payment, dividend or other
distribution, direct or indirect, in respect of (i) any Capital Stock of the
Borrower or any Restricted Subsidiary, except a distribution payable solely in
additional Capital Stock of the Borrower (other than Disqualified Stock) or (ii)
any Capital Stock of any Unrestricted Subsidiary to a holder of such Capital
Stock that is not the Borrower, a Restricted Subsidiary or any Unrestricted
Subsidiary
23
that is wholly owned by the Borrower or a Restricted Subsidiary, (b) any
payment, direct or indirect, on account of the redemption, retirement, purchase
or other acquisition of any Capital Stock of the Borrower or any Restricted
Subsidiary now or hereafter outstanding, except to the extent that the
consideration therefor consists of Capital Stock of the Borrower (other than
Disqualified Stock) and (c) except for any prepayment of Parity Debt
contemplated by Section 2.11 and the Collateral Documents, any principal payment
on, or redemption, repurchase, defeasance or other acquisition, or retirement
for value, prior to any scheduled repayment or maturity, of (i) any Indebtedness
subordinated in right of payment to the Facility Obligations or (ii) any
Mortgage Notes or other Parity Debt.
"Restricted Subsidiary" shall mean any Wholly Owned Subsidiary of the
Borrower (a) organized under the laws of the United States of America or any
state thereof or the District of Columbia, (b) none of the capital stock or
ownership interests of which is owned by Unrestricted Subsidiaries, (c)
substantially all of the operating assets of which are located in, and
substantially all of the business of which is conducted within the United States
and which business consists of the wholesale and retail sale, distribution and
storage of propane gas and related petroleum derivative products and/or the
related retail sale of supplies and equipment, including home appliances and (d)
designated by the Borrower as a Restricted Subsidiary in Schedule 1.01B or at a
subsequent date; provided, however, that (i) to the extent a newly formed or
acquired Wholly Owned Subsidiary satisfying the requirements of the foregoing
clauses (a), (b) and (c) is not declared either a Restricted Subsidiary or an
Unrestricted Subsidiary within 90 days of its formation or acquisition, such
Wholly Owned Subsidiary shall be deemed a Restricted Subsidiary and (ii) a
Restricted Subsidiary may be designated as an Unrestricted Subsidiary in
accordance with the provisions of Section 6.18.
"Revolving Credit Borrowing" shall mean a Borrowing consisting of
Revolving Loans.
"Revolving Credit Availability Period" shall mean the period from and
including the Closing Date to but excluding the earlier of (a) the date five
Business Days prior to the Conversion Date and (b) the termination of the
Revolving Credit Commitments of the Lenders in accordance with the terms hereof.
"Revolving Credit Borrowing" shall mean a Borrowing comprised of
Revolving Loans.
"Revolving Credit Commitment" shall mean, with respect to each Lender,
the commitment of such Lender to make Revolving Loans hereunder as set forth in
Section 2.01(b), in the aggregate principal amount at any time outstanding of up
to such Lender's Revolving Credit Commitment Percentage.
"Revolving Credit Commitment Percentage" shall mean, for each Lender,
the percentage identified as its Revolving Credit Commitment Percentage on
Schedule 1.01A hereto, as such percentage may be modified in connection with any
assignment made in accordance with the provisions of Section 9.04 or as the same
may be reduced from time to time pursuant to Section 2.09. For clarification
upon the Conversion Date, the term "Revolving Credit Commitment Percentage"
shall refer to each Lender's percentage of the Term Loans as determined in
accordance with Section 2.01(c).
24
"Revolving Loans" shall mean the revolving loans made by the Lenders to
the Borrower pursuant to Section 2.01(b). Each Revolving Loan shall be a
Eurodollar Revolving Loan or an ABR Revolving Loan.
"SEC" shall mean the Securities and Exchange Commission or any
successor thereto.
"Secured Parties" shall mean (a) the Lenders, (b) the Administrative
Agent and the Documentation Agent, in their capacities as such under each Loan
Document, (c) each Agent or Lender with which the Borrower enters into an
Interest Rate Agreement, in its capacity as a party to such agreement, (d) the
beneficiaries of each indemnification obligation undertaken by the Borrower or
any of the Loan Parties under any Loan Document, (e) the holders of any Parity
Debt and (f) the successors and assigns of the foregoing.
"Security Agreements" shall mean the Partners Security Agreement and
the Borrower Security Agreement.
"Seller" shall mean, with respect to any Acquired Business Entity, the
Person from whom the Business acquires (whether by purchase, merger or
consolidation) such Acquired Business Entity.
"Single Employer Plan" shall mean any Plan which is covered by Title IV
of ERISA, but which is not a Multiemployer Plan.
"Solvent" shall have the meaning assigned to such term in Section 3.19.
"Specified Percentage" as of any date shall mean (a) 100%, if the ratio
of Consolidated Cash Flow to Consolidated Interest Expense referred to in
Section 6.04(c) as of such date is less than or equal to 1.75:1.00, (b) 50%, if
the ratio of Consolidated Cash Flow to Consolidated Interest Expense referred to
in Section 6.04(c) as of such date is greater than 1.75:1.00, but less than or
equal to 2.00:1.00, (c) 25%, if such ratio of Consolidated Cash Flow to
Consolidated Interest Expense as of such date is greater than 2.00:1.00, but
less than or equal to 2.25:1.00 and (d) 0.00, if such ratio of Consolidated Cash
Flow to Consolidated Interest Expense as of such date is greater than 2.25:1.00.
"Star Gas Group" shall mean the Loan Parties.
"Star Gas LLC" shall mean Star Gas LLC, a Delaware limited liability
company and the successor general partner of the Borrower.
"Star/Petro" shall mean Star/Petro Inc., a Minnesota corporation.
"Star/Petro Intercompany Subordinated Debt" shall mean the borrowings
of Star/Petro made from time to time pursuant to Section 6.01(d) from the Public
Partnership and evidenced by the Star/Petro Intercompany Subordinated Note,
which shall be fully subordinate to the prior payment in full of the principal
and premium, if any, and interest on the Notes.
25
"Star/Petro Intercompany Subordinated Note" shall mean the intercompany
note dated as of March 25, 1999 evidencing the Star/Petro Intercompany
Subordinated Debt, which shall be fully subordinate to the prior payment, in
full, of the principal, interest and premium, if any, on the Notes.
"Statutory Reserves" shall mean 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 the Board and any other banking authority to which the
Administrative Agent is subject for any legal requirement to be maintained by
any Lender against (a) "Eurocurrency liabilities" as specified in Regulation D
of the Board, (b) any other category of liabilities that includes eurodollar
deposits by reference to which the LIBO Rate for any Eurodollar Borrowing is
determined, (c) the principal amount of or interest on any portion of any
Eurodollar Borrowing or (d) any other category of extensions of credit, or other
assets, that is based upon the LIBO Rate by a non-United States office of any of
the Lenders to United States residents, in each case without the benefits of
credits for prorations, exceptions or offsets that may be available to a Lender.
"Subsidiaries Consent and Agreement" shall mean the Subsidiaries
Consent and Agreement dated as of the date hereof among the Restricted
Subsidiaries and the Administrative Agent as to the consent and agreement of the
Restricted Subsidiaries in connection with the Subsidiary Guarantee Agreement
and the Borrower Security Agreement substantially in the form of Exhibit C, as
amended from time to time.
"Subsidiaries Guarantee Agreement" shall mean the Guarantee Agreement
dated as of December 13, 1995 among the Restricted Subsidiaries and the Trustee,
as amended from time to time.
"Subsidiary" shall mean any corporation, association, partnership,
joint venture or other business entity at least a majority (by number of votes)
of the stock of any class or classes (or equivalent interests) of which is at
the time owned by the Borrower or by one or more Subsidiaries of the Borrower or
by the Borrower and one or more Subsidiaries of the Borrower, if the holders of
the stock of such class or classes (or equivalent interests) (a) are ordinarily,
in the absence of contingencies, entitled to vote for the election of a majority
of the directors (or Persons performing similar functions) of such business
entity, even though the right so to vote has been suspended by the happening of
such a contingency, or (b) are at the time entitled, as such holders, to vote
for the election of the majority of the directors (or Persons performing similar
functions) of such business entity, whether or not the right so to vote exists
by reason of the happening of a contingency. Unless the context otherwise
requires, any reference to a Subsidiary shall mean a Subsidiary of the Borrower.
"Supplemental Agreement" shall mean an agreement between a Restricted
Subsidiary and the Trustee in the form attached hereto as Exhibit H, as amended
from time to time.
"Term Borrowing" shall mean a Borrowing comprised of Term Loans.
26
"Term Loan Commitment" shall mean, with respect to each Lender, the
commitment of such Lender to make a Term Loan hereunder as set forth in Section
2.01(c).
"Term Loans" shall have the meaning assigned to such term in Section
2.01(c). Each Term Loan shall be a Eurodollar Term Loan or an ABR Term Loan.
"Title Company" shall mean such title insurance company as shall be
satisfactory to the Agents.
"Total Funded Debt" as of any date shall mean (a) all Funded Debt of
the Borrower and its Restricted Subsidiaries as of such date, including
Indebtedness in respect of the Mortgage Notes, the Facility, Facility B under
the Existing Credit Agreement, but excluding Indebtedness under the Existing
Credit Agreement in respect of Facility A, minus (b) Net Working Capital of the
Borrower and its Restricted Subsidiaries as of such date (or, if such Net
Working Capital is negative, plus the amount thereof).
"Trust Agreement" shall mean the Intercreditor and Trust Agreement,
dated as of December 13, 1995, among the Borrower, the Public Partnership, Star
Gas Corporation, the Restricted Subsidiaries, the Trustee, the Lenders and the
Noteholders, as amended from time to time.
"Trustee" shall mean HSBC Bank USA (formerly Marine Midland Bank), as
Trustee under the Trust Agreement, and its successors and assigns thereunder.
"Twelfth Amendment" shall mean the Twelfth Amendment to the Existing
Credit Agreement, dated as of the date thereof.
"2000 Parity Notes" shall mean the $12,500,000 8.67% First Mortgage
Notes, Series A, due March 30, 2012 and the $15,000,000 8.72% First Mortgage
Notes, Series B, due March 30, 2015 issued by the Borrower and Star/Petro
pursuant to the Note Agreement dated as of March 30, 2000 among the Borrower,
Star/Petro and the investors named therein, as amended by the First Amendment
Note Agreement dated as of September 30, 2000.
"2001 Parity Notes" shall mean the $7,500,000 7.62% First Mortgage
Notes, Series A, due April 1, 2008 and the $22,000,000 7.95% First Mortgage
Notes, Series B, due April 1, 2001 issued by the Borrower and Star/Petro
pursuant to the Note Agreement dated as of March 15, 2001 among the Borrower,
Star/Petro and the investors named therein.
"Type" shall have the meaning assigned to such term in Section 1.03.
"Unrestricted Subsidiary" shall mean any Wholly Owned Subsidiary other
than a Restricted Subsidiary which is organized under the laws of the United
States of America or any state thereof or the District of Columbia and
substantially all of the operating assets of which are located in, and
substantially all of the business of which is conducted within the United States
and which business consists of the wholesale and retail sale, distribution and
storage of propane gas and related petroleum derivative products and the related
retail sale of supplies and
27
equipment, including home appliances; provided that at all times Petro Holdings
and its subsidiaries shall be deemed Unrestricted Subsidiaries.
"Wholly Owned", as applied to any Subsidiary, shall mean a Subsidiary
all the outstanding Capital Stock (other than directors' qualifying shares, if
required by law) of which is at the time owned by the Borrower or by one or more
Wholly Owned Subsidiaries or by the Borrower and one or more Wholly Owned
Subsidiaries.
Section 1.02 Terms Generally. The definitions in Section 1.01 shall
apply equally to both the singular and plural forms of the terms defined.
Whenever the context may require, any pronoun shall include the corresponding
masculine, feminine and neuter forms. The words "include", "includes" and
"including" shall be deemed to be followed by the phrase "without limitation".
All references herein to Articles, Sections, Exhibits and Schedules shall be
deemed references to Articles and Sections of, and Exhibits and Schedules to,
this Agreement unless the context shall otherwise require. Unless otherwise
expressly provided herein, all terms of an accounting or financial nature used
herein shall be interpreted in accordance with GAAP, as in effect from time to
time; provided, however, that, for purposes of (a) making any calculation
contemplated by the provisions of Article II and (b) determining compliance with
any covenant set forth in Article VI, such terms shall be construed in
accordance with GAAP as in effect on the date of this Agreement applied on a
basis consistent with the application used in preparing the Audited Financial
Statements. Unless otherwise expressly required herein, all calculations with
respect to the Borrower and the Restricted Subsidiaries shall be made exclusive
of any assets, liabilities, income or losses of any Unrestricted Subsidiary. As
used herein, the "knowledge" of the Borrower includes the knowledge of each and
every Loan Party. Unless otherwise expressly provided herein, the word "day"
means a calendar day.
Section 1.03 Types of Borrowings. The term "Borrowing" refers to the
portion of the aggregate principal amount of Loans of any Class outstanding
hereunder which bears interest of a specific Type and for a specific Interest
Period pursuant to a notice of Borrowing pursuant to Section 2.03. Each Lender's
ratable share of each Borrowing is referred to herein as a separate "Loan".
Borrowings, Loans, Letters of Credit and certain related terms hereunder may be
distinguished by "Class" and by "Type". The "Class" of a Loan or of a Commitment
to make such a Loan or of a Borrowing comprising such Loans or of a Letter of
Credit refers to whether such Loan is a Revolving Loan or a Term Loan, each of
which constitutes a Class. The "Type" of a Loan refers to whether such Loan is
an ABR Loan or a Eurodollar Loan. Borrowings and Loans may (but need not) be
identified both by Class and Type (e.g., a "Eurodollar Revolving Loan" is a Loan
which is both a Revolving Loan and a Eurodollar Loan).
ARTICLE II
THE CREDITS
Section 2.01 Commitment to Make Loans. (a) [Intentionally Omitted].
(b) Subject to the terms and conditions and relying upon the
representations and warranties herein set forth, each Lender agrees, severally
and not jointly, to make Revolving
28
Loans to the Borrower, at any time and from time to time during the Revolving
Credit Availability Period, in an aggregate principal amount at any time
outstanding not to exceed the excess, if any, of (i) such Lender's Revolving
Credit Commitment over (ii) its Letter of Credit Exposure at such time.
(c) Subject to the terms and conditions and relying upon the
representations and warranties herein set forth, each Lender agrees, severally
and not jointly, to convert the Revolving Loans to Term Loans by making a single
loan to the Borrower (each such loan, a "Term Loan") on the Conversion Date in a
principal amount not to exceed the sum of (i) the lesser of (A) the excess, if
any, of (I) such Lender's Revolving Credit Commitment immediately prior to such
date over (II) its Letter of Credit Exposure immediately prior to such date and
(B) the aggregate outstanding principal amount of such Lender's Revolving Loans
immediately prior to such date and (ii) such Lender's pro rata share (based on
the percentage of the aggregate Revolving Credit Commitments represented by such
Lender's Revolving Credit Commitment) of the aggregate Letter of Credit Exposure
immediately prior to such date.
(d) The Borrower may borrow, pay or prepay and reborrow Revolving Loans
during the Revolving Credit Availability Period, within the limits set forth in
Section 2.01(b) and upon the other terms and subject to the other conditions and
limitations set forth herein, provided that subject to the terms and conditions
herein set forth, at all times, the Borrower shall maintain Loans outstanding in
a minimum principal amount of at least $2,000,000 unless the Facility is
terminated through acceleration or otherwise. Amounts paid or prepaid in respect
of Term Loans may not be reborrowed.
Section 2.02 Loans. (a) Each Loan shall be made as part of a Borrowing
consisting of Loans made by the Lenders ratably in accordance with their
respective Revolving Credit Commitments or Term Loan Commitments, as the case
may be; provided, however, that the failure of any Lender to make any Loan shall
not in itself relieve any other Lender of its obligation to lend hereunder (it
being understood, however, that no Lender shall be responsible for the failure
of any other Lender to make any Loan required to be made by such other Lender).
The Loans comprising each Borrowing shall be in an aggregate principal amount
which is (i) an integral multiple of $100,000 and not less than $500,000 in the
case of Eurodollar Loans and (ii) an integral multiple of $100,000 in the case
of ABR Loans (or, in the case of ABR Loans, an aggregate principal amount equal
to the remaining balance of the Revolving Credit Commitments or Term Loan
Commitments, as the case may be).
(b) A particular Borrowing of any Class shall consist solely of ABR
Loans or Eurodollar Loans of such Class, as the Borrower may request pursuant to
Section 2.03. Each Lender may at its option fulfill its Commitment with respect
to any Eurodollar Loan by causing any domestic or foreign branch or Affiliate of
such Lender to make such Loan; provided that any exercise of such option shall
not affect the obligation of the Borrower to repay such Loan in accordance with
the terms of this Agreement and the applicable Note. Borrowings of more than one
Type and Eurodollar Loans bearing interest for more than one specific Interest
Period may be outstanding at the same time; provided, however, that the Borrower
shall not be entitled to request any Borrowing which, if made, would result in
an aggregate of more than five separate Eurodollar Loans of any Lender being
outstanding hereunder at any one time. For purposes of
29
the foregoing, Loans having different Interest Periods, regardless of whether
they commence on the same date, shall be considered separate Loans.
(c) Subject to Section 2.02(g), each Lender shall make a Loan in the
amount of its pro rata portion, as determined under Section 2.16, of each
Borrowing hereunder on the proposed date thereof by wire transfer of immediately
available funds to the Administrative Agent in Boston, Massachusetts, not later
than 1:00 p.m., Boston time, and the Administrative Agent shall by 3:00 p.m.,
Boston time, credit the amounts so received to the general deposit account of
the Borrower with the Administrative Agent or, if a Borrowing shall not occur on
such date because any condition precedent herein specified shall not have been
met, return the amounts so received to the respective Lenders.
(d) If the Administrative Agent has not received from the Borrower the
payment required by Section 2.21(g) by 12:30 p.m., Boston time, on the date on
which the Issuing Bank has notified the Borrower and the Administrative Agent
that payment of a draft presented under any Letter of Credit of any Class will
be made, as provided in Section 2.21(g), the Administrative Agent will promptly
notify the Issuing Bank and each Lender of the Letter of Credit Disbursement of
such Class and, in the case of each Lender, its pro rata share (based on such
Lender's Revolving Credit Commitment Percentage of such Class) of such Letter of
Credit Disbursement. Not later than 2:00 p.m., Boston time, on such date, each
Lender shall make available its pro rata share, as so determined, of such Letter
of Credit Disbursement, in Federal or other funds immediately available in
Boston, to the Administrative Agent at its address set forth in Section 9.01,
and the Administrative Agent will promptly make such funds available to the
Issuing Bank. The Administrative Agent will promptly remit to each Lender that
shall have made such funds available its pro rata share, as so determined, of
any amounts subsequently received by the Administrative Agent from the Borrower
in respect of such Letter of Credit Disbursement.
(e) Unless the Administrative Agent shall have received notice from a
Lender prior to the date of any Borrowing, or prior to the time of any required
payment by such Lender in respect of a Letter of Credit Disbursement, that such
Lender will not make available to the Administrative Agent such Lender's pro
rata portion of such Borrowing or payment, the Administrative Agent may assume
that such Lender has made such portion available to the Administrative Agent on
the date of such Borrowing or payment in accordance with Section 2.02(c) or (d),
as applicable, and the Administrative Agent may, in reliance upon such
assumption, make available to the Borrower or Issuing Bank, as applicable, on
such date a corresponding amount. If and to the extent that such Lender shall
not have made such portion available to the Administrative Agent, such Lender
and the Borrower severally agree to repay to the Administrative Agent forthwith
on demand such corresponding amount together with interest thereon, for each day
from the date such amount is made available to the Borrower or the Issuing Bank
(or, if the Administrative Agent and the Issuing Bank are the same Person, from
the date of such payment in respect of a Letter of Credit Disbursement), as
applicable, until the date such amount is repaid to the Administrative Agent at,
(i) in the case of the Borrower, the interest rate applicable thereto pursuant
to Section 2.06 or 2.21(g), as applicable and (ii) in the case of such Lender,
the Federal Funds Effective Rate. If such Lender shall repay to the
Administrative
30
Agent such corresponding amount in respect of a Borrowing, such amount shall
constitute such Lender's Loan as part of such Borrowing for purposes of this
Agreement.
(f) Notwithstanding any other provision of this Agreement, the Borrower
shall not be entitled to request any Revolving Credit Borrowing if the Interest
Period requested with respect thereto would end after the Conversion Date. Any
Revolving Credit Borrowing which cannot be refinanced as a Eurodollar Borrowing
by reason of the preceding sentence shall be automatically converted at the end
of the Interest Period in effect for such Borrowing into an ABR Revolving Credit
Borrowing. Further, and notwithstanding any other provision of this Agreement to
the contrary, the Borrower shall not be entitled to request, nor shall any
Lender be required to make, any Eurodollar Loan during the existence of a
Default or an Event of Default unless the Required Lenders otherwise agree.
(g) The Borrower may refinance (i) all or any part of any Revolving
Credit Borrowing with a Revolving Credit Borrowing of the same or a different
Type and (ii) all or any part of any Revolving Credit Borrowing outstanding on
the Conversion Date with a Term Borrowing of the same or a different Type, in
each case upon the terms and subject to the conditions and limitations set forth
in this Agreement. Any Revolving Credit Borrowing or part thereof so refinanced
shall be deemed to be repaid or prepaid in accordance with Section 2.04 or 2.12,
as applicable, with the proceeds of such new Revolving Credit Borrowing or Term
Borrowing, as applicable; and the proceeds of such new Revolving Credit
Borrowing or Term Borrowing, as applicable (to the extent they do not exceed the
principal amount of the Revolving Credit Borrowing being refinanced), shall not
be paid by the Lenders to the Administrative Agent or by the Administrative
Agent to the Borrower pursuant to Section 2.02(c).
Section 2.03 Notice of Borrowings. The Borrower shall give the
Administrative Agent written or telecopy notice in the form of Exhibit I hereto
(or telephone notice promptly confirmed in writing or by telecopy in the form of
Exhibit I hereto) (a) in the case of a Eurodollar Borrowing, not later than
11:00 a.m., Boston time, two Business Days before a proposed borrowing and (b)
in the case of an ABR Borrowing, not later than 11:00 a.m., Boston time, on the
Business Day of the proposed borrowing. Such notice shall be irrevocable and
shall in each case refer to this Agreement and specify (i) the applicable Class
and Type of such Borrowing; (ii) the date of such Borrowing (which shall be a
Business Day) and the amount thereof; and (iii) if such Borrowing is to be a
Eurodollar Borrowing, the Interest Period with respect thereto. If no election
as to the Type of Borrowing is specified in any such notice, then the requested
Borrowing shall be an ABR Borrowing. If no Interest Period with respect to any
Eurodollar Borrowing is specified in any such notice, then the Borrower shall be
deemed to have selected an Interest Period of one month's duration. If the
Borrower shall not have given notice in accordance with this Section 2.03 of its
election to refinance a Revolving Credit Borrowing prior to the end of the
Interest Period in effect for such Borrowing, then the Borrower shall (unless
such Borrowing is repaid at the end of such Interest Period) be deemed to have
given notice of an election to refinance such Borrowing with an ABR Borrowing.
The Administrative Agent shall promptly advise the Lenders of any notice given
pursuant to this Section 2.03 and of each Lender's pro rata portion of the
requested Borrowing.
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Section 2.04 Notes; Repayment of Loans. The Loans made by each Lender
shall be evidenced by a Note, duly executed and delivered on behalf of the
Borrower, dated the Closing Date, in substantially the form attached hereto as
Exhibit A with the blanks appropriately filled, payable to the order of such
Lender in a principal amount equal to such Lender's Revolving Credit Commitment.
The outstanding principal balance of each Loan, as evidenced by the applicable
Note, shall be payable (a) in the case of a Revolving Loan, on the last day of
the Interest Period applicable to such Loan and on the Conversion Date and (b)
in the case of a Term Loan, as provided in Section 2.11. Each Note shall bear
interest from the date of the first Borrowing hereunder on the outstanding
principal balance thereof as set forth in Section 2.06. Each Lender shall, and
is hereby authorized by the Borrower to, endorse on the schedule attached to
each Note delivered to such Lender (or on a continuation of such schedule
attached to such Note and made a part thereof), or otherwise to record in such
Lender's internal records, an appropriate notation evidencing the date and
amount of each applicable Loan from such Lender, each payment and prepayment of
principal of any such Loan, each payment of interest on any such Loan and the
other information provided for on such schedule; provided, however, that the
failure of any Lender to make such a notation or any error therein shall not
affect the obligation of the Borrower to repay the Loans made by such Lender in
accordance with the terms of this Agreement and the applicable Notes.
Section 2.05 Fees. (a) [Intentionally omitted].
(b) The Borrower shall pay to the Administrative Agent for the account
of each Lender, on the last day of March, June, September and December in each
year, and on the last day of the Revolving Credit Availability Period, a
commitment fee (a "Commitment Fee") on the average daily unused amount of the
Revolving Credit Commitment of such Lender during the preceding calendar quarter
(or shorter period commencing with the date of this Agreement or ending with the
last day of the Revolving Credit Availability Period), equal to (i) during any
Level I Pricing Period, 0.25% per annum, (ii) during any Level II Pricing
Period, 0.375% per annum and (iii) at all other times, 0.50% per annum. The
"unused amount" of the Revolving Credit Commitment of a Lender on any date means
the amount of such Lender's Revolving Credit Commitment on such date, less the
sum of its outstanding Revolving Loans on such date and its Letter of Credit
Exposure on such date. All Commitment Fees shall be computed on the basis of the
actual number of days elapsed in a year of 360 days. The Commitment Fee due to
each Lender shall commence to accrue from the date of this Agreement and shall
cease to accrue on the last day of the Revolving Credit Availability Period.
(c) The Borrower agrees to pay to the Administrative Agent, for its own
account, the fees set forth in the Fee Letter dated February 12, 2002 (the
"Letter Agreement"), among the Administrative Agent, the General Partner and the
Borrower, in the amounts and on the dates provided in the Letter Agreement. Such
fees shall be in addition to reimbursement of the Administrative Agents'
reasonable out- of-pocket expenses.
(d) All Fees shall be paid on the dates due, in immediately available
funds. Once paid, none of the Fees shall be refundable under any circumstances.
32
Section 2.06 Interest on Loans. (a) [Intentionally Omitted].
(b) Subject to Section 2.07, each Revolving Loan or Term Loan
comprising an ABR Borrowing shall bear interest for each day from the date such
Loan is made until it becomes due (computed on the basis of the actual number of
days elapsed over a year of 360 days) at a rate per annum equal to the Alternate
Base Rate, plus the Applicable ABR Margin.
(c) [Intentionally Omitted].
(d) Subject to Section 2.07, each Revolving Loan or Term Loan
comprising a Eurodollar Borrowing shall bear interest for each day from the date
such Loan is made until it becomes due (computed on the basis of the actual
number of days elapsed over a year of 360 days) at a rate per annum equal to the
Adjusted LIBO Rate for the Interest Period in effect for such Borrowing, plus
the Applicable Eurodollar Margin.
(e) Any change in any Applicable Margin required hereunder shall be
deemed to occur (i) five Business Days after the date the Borrower delivers its
financial statements required by Section 5.02(a) or (b), as the case may be, in
respect of its most recent fiscal quarter and the certificate required by
Section 5.02(c) or (ii) on the date any Revolving Credit Borrowing is made or
any Letter of Credit is issued in respect of the financial statements required
by Section 5.02(a); provided that if the Borrower fails to deliver such
financial statements and certificate on or before the date such statements and
certificate are required to be delivered pursuant to Section 5.02(a) or (b), as
the case may be, and Section 5.02(c), the Applicable Margin for the period from
such required date until the date such statements and certificate are actually
delivered shall be calculated as if a Level III Pricing Period were in effect,
and after the date such statements and certificate are actually delivered the
Applicable Margin shall be determined as otherwise provided for herein.
(f) Interest on each Loan shall be payable on the Interest Payment
Dates applicable to such Loan, except as otherwise provided in this Agreement.
The applicable Alternate Base Rate or Adjusted LIBO Rate for each Interest
Period or day within an Interest Period, as the case may be, shall be determined
by the Administrative Agent, and such determination shall be conclusive absent
manifest error.
Section 2.07 Default Interest. If the Borrower shall default in the
payment of the principal of or interest on any Loan or any other amount becoming
due under this Agreement or any other Loan Document, by acceleration or
otherwise, interest shall accrue, to the extent permitted by law, on such
defaulted amount during the period from (and including) the date of such default
to (but not including) the date of actual payment (after as well as before
judgment) at (a) in the case of principal or interest on any Loan, the rate per
annum (computed on the basis of the actual number of days elapsed over a year of
360 days) that would otherwise be applicable to such Loan pursuant to Section
2.06 as if a Level III Pricing Period were in effect, plus 2.00% or (b) in the
case of any other amount, a rate per annum (computed on the basis of the actual
number of days elapsed over a year of 360 days) equal to the rate applicable to
ABR Revolving Loans pursuant to Section 2.06 as if a Level III Pricing Period
were in effect, plus 2.00%. The Borrower shall pay all such accrued but unpaid
interest from time to time upon demand.
33
Section 2.08 Alternate Rate of Interest. In the event, and on each
occasion, that on the day two Business Days prior to the commencement of any
Interest Period for a Eurodollar Borrowing the Administrative Agent shall have
determined that dollar deposits in the principal amounts of the Loans comprising
such Borrowing are not generally available in the applicable interbank market,
or that the rates at which such dollar deposits are being offered will not
adequately and fairly reflect the cost to any Lender of making or maintaining
its Eurodollar Loan during such Interest Period, or that reasonable means do not
exist for ascertaining the Adjusted LIBO Rate, the Administrative Agent shall,
as soon as practicable thereafter, give written or telecopy notice of such
determination to the Borrower and the Lenders. In the event of any such
determination, any request by the Borrower for a Eurodollar Borrowing pursuant
to Section 2.03 or 2.10 shall, until the Administrative Agent shall have advised
the Borrower and the Lenders that the circumstances giving rise to such notice
no longer exist, be deemed to be a request for an ABR Borrowing. Each
determination by the Administrative Agent hereunder shall be conclusive absent
manifest error.
Section 2.09 Termination and Reduction of Commitments; Conversion of
Revolving Loans. (a) The Revolving Credit Commitments shall be automatically
terminated at 5:00 p.m., Boston time, on the Conversion Date.
(b) Upon at least three Business Days' prior irrevocable written or
telecopy notice to the Administrative Agent, the Borrower may at any time in
whole permanently terminate, or from time to time in part permanently reduce,
the Revolving Credit Commitments; provided, however that (i) the Borrower
simultaneously reduce Facility B pro rata such that at all times the Revolving
Credit Commitment Percentage of each Lender hereunder and the Tranche B
Revolving Credit Commitment Percentage (as defined in the Existing Credit
Agreement) of the lenders under Facility B shall be the same, (ii) in the event
the Borrower permanently terminates or reduces Facility B in whole, the Borrower
shall simultaneously terminate or reduce, as the case may be, the Facility and
(iii) each partial reduction of the Revolving Credit Commitments and Facility B
shall be in a minimum collective aggregate principal amount which is an integral
multiple of $100,000 and not less than $500,000.
(c) In the event, and on each occasion, that the Borrower is required
to prepay or repay Revolving Loans and/or to provide cash collateral for Letters
of Credit as provided in Section 2.11(e) or (f) and Section 2.11(g), then on the
date of such required action, the Revolving Credit Commitments shall be
automatically and permanently reduced by an amount equal to the sum of such
required payment and cash collateral; provided, however that (i) the Borrower
simultaneously reduce Facility B pro rata in the amount of such prepayment or
reduction, such that at all times the Revolving Credit Commitment Percentage of
each Lender hereunder and the Tranche B Revolving Credit Commitment Percentage
(as defined in the Existing Credit Agreement) of the lenders under Facility B
shall be the same and (ii) in the event the Borrower prepays the amount of
Facility B, in whole, the Borrower shall simultaneously prepay the Facility in
its entirety. In addition, in the event that the amount of any Excess Proceeds
referred to in paragraph (e) or (f) of Section 2.11 which is allocable to the
Facility Obligations exceeds the amount of all outstanding Loans and Letter of
Credit Exposure, the Commitments shall be further reduced by such excess, by
reduction, to the Revolving Credit Commitments. For purposes of applying the
requirements of this Section 2.09(c), the amount of any Excess
34
Proceeds referred to in paragraph (e) or (f) of Section 2.11 which is allocable
to the Facility Obligations shall be calculated as if the definition set forth
in the last sentence of Section 2.11(e) included, in addition, the maximum
aggregate amount of the unused Revolving Credit Commitments.
(d) Each reduction in the Revolving Credit Commitments of any Class in
accordance with this Article II shall be made ratably among the Lenders in
accordance with their respective Revolving Credit Commitments of such Class and
shall be made in the same proportion among the lenders in accordance with the
Tranche B Revolving Credit Commitment Percentage. The Borrower shall pay to the
Administrative Agent for the account of the Lenders, on the date of each
termination or reduction of the Revolving Credit Commitments of any Class, the
Commitment Fees on the amount of the Revolving Credit Commitments of such Class
so terminated or reduced accrued to the date of such termination or reduction.
Section 2.10 Conversion and Continuation of Term Borrowings. The
Borrower shall have the right at any time upon prior irrevocable notice to the
Administrative Agent (a) not later than 11:00 a.m., Boston time, on the Business
Day of conversion, to convert any Eurodollar Term Borrowing into an ABR Term
Borrowing, (b) not later than 11:00 a.m., Boston time, two Business Days prior
to conversion or continuation, to convert any ABR Term Borrowing into a
Eurodollar Term Borrowing or to continue any Eurodollar Term Borrowing as a
Eurodollar Term Borrowing for an additional Interest Period and (c) not later
than 11:00 a.m., Boston time, two Business Days prior to conversion, to convert
the Interest Period with respect to any Eurodollar Term Borrowing to another
permissible Interest Period, subject in each case to the following:
(i) each conversion or continuation shall be made pro rata
among the Lenders in accordance with the respective principal amounts
of the Term Loans comprising the converted or continued Term Borrowing;
(ii) the aggregate principal amount of such Term Borrowing
converted into or continued as (A) a Eurodollar Term Borrowing, shall
be an integral multiple of $100,000 and not less than $500,000 or (B)
an ABR Term Borrowing, shall be the lesser of (I) the remaining
outstanding principal amount of such Borrowing and (II) an integral
multiple of $100,000;
(iii) each conversion or continuation shall be effected by
each Lender by applying the proceeds of the new Term Loan of such
Lender resulting from such conversion or continuation to the Term Loan
(or portion thereof) of such Lender being converted or continued;
accrued interest on a Eurodollar Term Loan (or portion thereof) being
converted or continued shall be paid by the Borrower at the time of
conversion;
(iv) if any Eurodollar Term Borrowing is converted or
continued at a time other than the end of the Interest Period
applicable thereto, the Borrower shall pay, upon demand, any amounts
due to the Lenders pursuant to Section 2.15;
35
(v) any portion of a Term Borrowing maturing or required to be
repaid in less than one month may not be converted into or continued as
a Eurodollar Term Borrowing;
(vi) unless the Required Lenders otherwise agree, during the
existence of a Default or an Event of Default, the Borrower shall not
be entitled to elect to have any Term Borrowing converted into or
continued as a Eurodollar Term Borrowing:
(vii) any portion of a Term Borrowing which cannot be
converted into or continued as a Eurodollar Term Borrowing by reason of
clause (v) or (vi) above shall be automatically converted at the end of
the Interest Period in effect for such Borrowing into an ABR Term
Borrowing;
(viii) no Interest Period may be selected for any Eurodollar
Term Borrowing that would end later than a Repayment Date occurring on
or after the first day of such Interest Period if, after giving effect
to such selection, the aggregate outstanding amount of (A) Eurodollar
Term Borrowings with Interest Periods ending on or prior to such
Repayment Date and (B) the ABR Term Borrowings would not be at least
equal to the principal amount of Term Borrowings to be paid on such
Repayment Date.
Each notice pursuant to this Section 2.10 shall be irrevocable and
shall refer to this Agreement and specify (I) the principal amount, the Type
and, in the case of a Eurodollar Term Borrowing, the Interest Period of the Term
Borrowing that the Borrower requests be converted or continued, (II) whether
such Term Borrowing is to be converted to or continued as a Eurodollar Term
Borrowing or an ABR Term Borrowing, (III) if such notice requests a conversion,
the date of such conversion (which shall be a Business Day) and (IV) if such
Term Borrowing is to be converted to or continued as a Eurodollar Term
Borrowing, the Interest Period with respect thereto. If no Interest Period is
specified in any such notice with respect to any conversion to or continuation
as a Eurodollar Term Borrowing, the Borrower shall be deemed to have selected an
Interest Period of one month's duration. The Administrative Agent shall advise
the other Lenders of any notice given pursuant to this Section 2.10 and of each
Lender's pro rata portion of any converted or continued Term Borrowing. If the
Borrower shall not have given notice in accordance with this Section 2.10 to
continue any Term Borrowing into a subsequent Interest Period (and shall not
otherwise have given notice in accordance with this Section 2.10 to convert such
Term Borrowing), such Term Borrowing shall, at the end of the Interest Period
applicable thereto (unless repaid pursuant to the terms hereof), automatically
be continued into a new Interest Period as an ABR Term Borrowing.
Section 2.11 Mandatory Repayments and Prepayments. (a) [Intentionally
omitted].
(b) On the Conversion Date, all Revolving Credit Borrowings shall be
due and payable to the extent not previously paid.
(c) Subject to adjustment as provided in Section 2.11(h) and Section
2.12(b), the Borrower shall repay the Term Loans and reduce the Letter of Credit
Exposure in quarterly installments, commencing on December 31, 2003, and
continuing on the last day of every third
36
calendar month thereafter through September 30, 2005 (the due date of each such
installment being called a "Repayment Date"). The amount of any such installment
payable on a Repayment Date shall be the amount, if any, necessary (after giving
effect to any reductions on account of the expiration after the Conversion Date
of any Letters of Credit) to reduce the sum of (i) the aggregate principal
amount of the Term Loans outstanding immediately after the Conversion Date and
(ii) the Letter of Credit Exposure outstanding immediately after the Conversion
Date by an aggregate percentage of such sum equal to the percentage set forth
opposite such Repayment Date below:
December 31, 2003 12.5%
March 31, 2004 25.0%
June 30, 2004 37.5%
September 30, 2004 50.0%
December 31, 2004 62.5%
March 31, 2005 75.0%
June 30, 2005 87.5%
September 30, 2005 100.0%
On the Repayment Date that is September 30, 2005, Borrower shall repay the
remaining principal and interest owing on all outstanding Term Loans and fully
cash collateralize any then existing Letter of Credit Exposure. All payments
under this paragraph (c) shall be applied (I) first, to repay any outstanding
Term Loans and (II) second, after the Term Loans have been paid in full, to
reduce the Letter of Credit Exposure. Any such payments so applied to reduce the
Letter of Credit Exposure shall be deposited with the Administrative Agent
pursuant to the Cash Collateral Agreement as provided in Section 2.21(k).
(d) [Intentionally Omitted].
(e) If at any time the Borrower or any of the Restricted Subsidiaries
disposes of property or such property shall be damaged, destroyed or taken in
eminent domain or there shall be title insurance proceeds with respect to such
property, in any such case, with the result that there are Excess Proceeds, and
the Borrower does not apply such Excess Proceeds in the manner described in
Section 6.07(c)(iii)(B)(I), the Borrower shall prepay, upon notice as provided
in paragraph (g) of this Section 2.11 (which notice shall be given not later
than 180 days after the date of such sale of property), a principal amount of
the outstanding Facility Obligations equal to the amount of such remaining
Excess Proceeds allocable to the Facility Obligations, determined by allocating
such remaining Excess Proceeds pro rata among the Lenders, the lenders under the
Existing Credit Agreement and the holders of Parity Debt, if any, outstanding on
the date such prepayment is to be made, according to the aggregate then unpaid
principal amounts of the Facility Obligations, the Facilities Obligations (as
defined in the Existing Credit Agreement) and Parity Debt (and the Make Whole
Amount on the principal amount of the Mortgage Notes to be prepaid). For
purposes of this Section 2.11, the aggregate then unpaid principal amount of the
Facility Obligations" under this Agreement shall equal the sum of (i) the
aggregate principal amount of the outstanding Loans and (ii) the Letter of
Credit Exposure.
37
(f) In the event that damage, destruction or a taking shall occur in
respect of all or a portion of the properties subject to any of the Collateral
Documents, or there shall be proceeds under title insurance policies with
respect to any real property, all Net Insurance Proceeds (as defined in the
Mortgage), self-insurance amounts, Net Awards (as defined in the Mortgage) or
title insurance proceeds which, as of any date, shall not theretofore have been
applied to the cost of Restoration (as defined in the Mortgage) shall be deemed
to be proceeds of property disposed of voluntarily, shall be subject to the
provisions of Section 6.07(c) and, if subdivision (iii)(B)(I) of Section 6.07(c)
is applicable thereto, shall be subject to the prepayment provisions of
paragraph (e) of this Section 2.11; provided that, if any such event or
circumstances (individually or together with all other related events and
circumstances) shall result in proceeds of more than $25,000,000 in the
aggregate, the Borrower shall not apply such proceeds to replacement or other
assets or undertake any Restoration without the prior written consent of the
Required Lenders.
(g) The Borrower will give the Administrative Agent irrevocable written
notice of each prepayment under paragraph (e) or (f) of this Section 2.11 not
less than 10 days and not more than 30 days prior to the date fixed for such
prepayment, in each case specifying such prepayment date, the aggregate
principal amount of the Facility Obligations to be prepaid, the aggregate
principal amount of the Facilities Obligations (as defined in the Existing
Credit Agreement) to be prepaid and the principal amount of each issue of Parity
Debt to be prepaid and the paragraph under which such prepayment is to be made.
Each Lender shall receive, on the Business Day immediately preceding the date
scheduled for any such prepayment, a certificate of a Financial Officer of the
Borrower certifying that the applicable conditions of this Section 2.11 have
been fulfilled and specifying the particulars of such fulfillment. Such
certificate shall set forth the principal amount of the Facility Obligations
being prepaid and specify how such amount was determined, and certify that such
amount has been computed in accordance with this Section 2.11.
(h) All mandatory prepayments of the Facility Obligations under
paragraphs (e) and (f) of this Section 2.11 shall be applied to pay or prepay
any outstanding Revolving Loans or Term Loans and, to the extent that the
remaining amount of such prepayment is greater than the aggregate principal
amount of outstanding Loans, to reduce the Letter of Credit Exposure. All such
mandatory prepayments so applied on or after the Conversion Date shall be
applied to reduce the amount of scheduled payments due under Section 2.11(c)
after the date of such prepayment in the inverse order of maturity (without
affecting the requirement that such prepayments be applied first to pay all
outstanding Term Loans and only thereafter to reduce the Letter of Credit
Exposure). Subject to the foregoing provisions, any such mandatory prepayment of
Loans of any Class shall be applied to prepay all ABR Loans of such Class before
any Eurodollar Loans of such Class are prepaid. Any such payments under
paragraphs (e) and (f) of this Section 2.11 so applied to reduce the Letter of
Credit Exposure shall be deposited with the Trustee and applied as provided in
the Trust Agreement.
(i) [Intentionally Omitted].
(j) In the event and on each occasion that the sum of (i) the aggregate
outstanding principal amount of the Revolving Loans and (ii) the Letter of
Credit Exposure exceeds the
38
aggregate amount of the Revolving Credit Commitments at such time, the Borrower
shall immediately prepay Revolving Loans (and, to the extent that the amount of
such excess is greater than the aggregate principal amount of outstanding
Revolving Loans, reduce the Letter of Credit Exposure by making a deposit with
the Administrative Agent pursuant to the Cash Collateral Agreement as provided
in Section 2.21(k)) in an aggregate principal amount equal to such excess.
(k) Each payment of Borrowings pursuant to this Section 2.11 shall be
accompanied by accrued interest on the principal amount paid to but excluding
the date of payment. The repayments and prepayments of the Loans required by the
respective subsections of this Section 2.11 and the optional prepayments
permitted by Section 2.12 are separate and cumulative, so that any one such
repayment or prepayment shall reduce any other repayment or prepayment only as
and to the extent expressly specified herein. All payments under this Section
2.11 shall be subject to Section 2.15, but otherwise shall be without premium or
penalty.
Section 2.12 Optional Prepayments. (a) Subject to Section 2.01(d) and
Section 2.12(b), the Borrower shall have the right at any time and from time to
time to prepay any Borrowing or payment due under Section 2.11(c), in whole or
in part, upon prior written or telecopy notice (or telephone notice promptly
confirmed by written or telecopy notice) to the Administrative Agent (i) in the
case of any prepayment of amounts payable under Section 2.11(c), not later than
11:00 a.m., Boston time, two Business Days in advance of the proposed
prepayment, (ii) in the case of any prepayment of Eurodollar Revolving Loans,
not later than 11:00 a.m., Boston time, two Business Days in advance of the
proposed prepayment and (iii) in the case of any prepayment of ABR Revolving
Loans, not later than 11:00 a.m., Boston time, on the Business Day of the
proposed prepayment; provided, however, that (A) the Borrower simultaneously
reduce Facility B pro rata, such that the prepayments made pursuant to this
Section 2.12(a) and Section 2.12(a) of the Existing Credit Agreement shall be in
equal dollar amounts and (B) each partial prepayment of ABR Loans shall be in a
minimum aggregate amount of $100,000 under each of Facility B and this Facility
and each partial prepayment of Eurodollar Loans shall be in an amount which is
an integral multiple of $100,000 under each of Facility B and this Facility and
not less than $500,000 under each of Facility B and this Facility, (C) in the
event that the Borrower prepays the lenders under Facility B with respect to the
term loans thereunder, in whole, the Borrower shall simultaneously prepay in
whole the Term Loans under the Facility and (D) a partial prepayment of a
Eurodollar Borrowing under this Section 2.12(a) shall not be made that would
result in the remaining aggregate outstanding principal amount thereof under
each of Facility B and this Facility being less than $500,000. Each notice of
prepayment of any Borrowing or payment due under Section 2.11(c) shall specify
the prepayment date, the Class, the Type and the Interest Period of the
Borrowing to be prepaid (in the case of a Eurodollar Borrowing), and the
principal amount thereof to be prepaid, shall be irrevocable and shall commit
the Borrower to prepay such Borrowing or payment by the amount stated therein on
the date stated therein.
(b) All prepayments under this Section 2.12 shall be subject to Section
2.15 but otherwise shall be without premium or penalty. All prepayments under
this Section 2.12 shall be accompanied by accrued interest on the principal
amount being prepaid to, but excluding, the date of payment. All prepayments
under this Section 2.12 of amounts payable under Section
39
2.l1(c) shall be applied to reduce the amount of scheduled payments of amounts
due under Section 2.11(c) after the date of such prepayment in the inverse order
of maturity (without affecting the requirement that such prepayments be applied
first to pay all outstanding Term Loans and only thereafter to provide cash
collateral in respect of Letters of Credit) until the last four of such
scheduled payments shall have been repaid in full, and thereafter all such
prepayments of amounts payable under Section 2.11(c) shall be applied to reduce
such remaining scheduled payments pro rata. Subject to the foregoing provisions,
any optional prepayment of Loans of any Class pursuant to Section 2.12(a) shall
be applied to prepay all ABR Loans of such Class before any Eurodollar Loans of
such Class are prepaid.
Section 2.13 Reserve Requirements; Certain Changes in Circumstances.
(a) Notwithstanding any other provision herein, if after the date of this
Agreement any change in applicable law or regulation or in the interpretation or
administration thereof by any Governmental Authority charged with the
interpretation or administration thereof (whether or not having the force of
law) shall change the basis of taxation of payments to any Lender of the
principal of or interest on any Eurodollar Loan made by such Lender or any Fees
or other amounts payable hereunder (other than changes in respect of taxes
imposed on the overall net income of such Lender by the jurisdiction in which
such Lender has its principal office or by any political subdivision or taxing
authority therein), or shall impose, modify or deem applicable any reserve,
special deposit or similar requirement against assets of, deposits with or for
the account of or credit extended by such Lender (except any such reserve
requirement which is reflected in the Adjusted LIBO Rate) or shall impose on
such Lender or the applicable interbank market any other condition affecting
this Agreement or Eurodollar Loans made by such Lender, and the result of any of
the foregoing shall be to increase the cost to such Lender of making or
maintaining any Eurodollar Loan or to reduce the amount of any sum received or
receivable by such Lender hereunder or under the Notes (whether of principal,
interest or otherwise) or Letters of Credit by an amount deemed by such Lender
to be material, then from time to time the Borrower shall pay to such Lender
upon demand such additional amount or amounts as will compensate such Lender for
such additional costs incurred or reduction suffered.
(b) If any Lender shall have determined that the adoption after the
date hereof of any law, rule, regulation, agreement or guideline regarding
capital adequacy, or any change in any of the foregoing or in the interpretation
or administration of any of the foregoing by any Governmental Authority, central
bank or comparable agency charged with the interpretation or administration
thereof, or compliance by any Lender (or any lending office of such Lender) or
any Lender's holding company with any request or directive regarding capital
adequacy (whether or not having the force of law) of any such authority, central
bank or comparable agency, has or would have the effect of reducing the rate of
return on such Lender's capital or on the capital of such Lender's holding
company, if any, as a consequence of this Agreement, the Letters of Credit or
the Loans made by such Lender pursuant hereto to a level below that which such
Lender or such Lender's holding company could have achieved but for such
adoption, change or compliance (taking into consideration such Lender's policies
and the policies of such Lender's holding company with respect to capital
adequacy) by an amount deemed by such Lender or such Lender's holding company to
be material, then from time to time the Borrower shall pay to such Lender upon
demand such additional amount or amounts as will compensate such Lender or such
Lender's holding company for any such reduction suffered.
40
(c) A certificate of each Lender setting forth such amount or amounts
as shall be necessary to compensate such Lender or its holding company as
specified in paragraph (a) or (b) above, as the case may be, shall be delivered
to the Borrower and shall be conclusive absent manifest error. The Borrower
shall pay each Lender the amount shown as due on any such certificate delivered
by it within 10 days after its receipt of the same.
(d) No Lender shall be entitled to compensation under this Section 2.13
for any costs incurred or reductions suffered with respect to any date unless
such Lender shall have notified the Borrower that it will demand compensation
for such costs or reductions not more than 120 days after the later of (i) such
date and (ii) the date on which such Lender becomes aware of such costs or
reductions. Failure on the part of any Lender to demand compensation for any
increased costs or reduction in amounts received or receivable or reduction in
return on capital with respect to any period shall not constitute a waiver of
such Lender's right to demand compensation with respect to any other period. The
protection of this Section 2.13 shall be available to each Lender regardless of
any possible contention of the invalidity or inapplicability of the law, rule,
regulation, guideline or other change, condition or circumstances which shall
have occurred or been imposed.
Section 2.14 Change in Legality. (a) Notwithstanding any other
provision herein, if any change in any law or regulation or in the
interpretation thereof by any Governmental Authority charged with the
administration or interpretation thereof shall make it unlawful for any Lender
to make or maintain any Eurodollar Loan or to give effect to its obligations as
contemplated hereby with respect to any Eurodollar Loan, then, by written or
telecopy notice to the Borrower and to the Administrative Agent, such Lender
may:
(i) declare that Eurodollar Loans will not thereafter be made
by such Lender hereunder, whereupon any request by the Borrower for a
Eurodollar Borrowing shall, as to such Lender only, be deemed a request
for an ABR Loan unless such declaration shall be subsequently
withdrawn; and
(ii) require that all outstanding Eurodollar Loans made by it
be converted to ABR Loans, in which event all such Eurodollar Loans
shall be automatically converted to ABR Loans as of the effective date
of such notice as provided in Section 2.14(b).
In the event that any Lender shall exercise its rights under clause (i) or (ii)
above, all payments and prepayments of principal which would otherwise have been
applied to repay the Eurodollar Loans that would have been made by such Lender
or the converted Eurodollar Loans of such Lender shall instead be applied to
repay the ABR Loans made by such Lender in lieu of, or resulting from the
conversion of, such Eurodollar Loans.
(b) For purposes of this Section 2.14, a notice to the Borrower by any
Lender shall be effective as to each Eurodollar Loan, if lawful, on the last day
of the Interest Period currently applicable to such Eurodollar Loan; in all
other cases such notice shall be effective on the date of receipt by the
Borrower.
41
Section 2.15 Indemnity. The Borrower shall indemnify each Lender
against any loss or expense which such Lender may sustain or incur as a
consequence of (a) any failure by the Borrower to fulfill on the date of any
borrowing hereunder the applicable conditions set forth in Article IV, (b) any
failure by the Borrower to borrow or to refinance, convert or continue any Loan
hereunder after irrevocable notice of such borrowing, refinancing, conversion or
continuation has been given pursuant to Section 2.03 or 2.10, (c) any payment,
prepayment or conversion of a Eurodollar Loan required by any other provision of
this Agreement or otherwise made or deemed made on a date other than the last
day of the Interest Period applicable thereto, (d) any default in payment or
prepayment of the principal amount of any Loan or any part thereof or interest
accrued thereon, as and when due and payable (at the due date thereof, whether
by scheduled maturity, acceleration, irrevocable notice of prepayment or
otherwise) or (e) the occurrence of any Event of Default, including, in each
such case, any loss or reasonable expense sustained or incurred or to be
sustained or incurred in liquidating or employing deposits from third parties
acquired to effect or maintain such Loan or any part thereof as a Eurodollar
Loan. Such loss or reasonable expense shall include an amount equal to the
excess, if any, as reasonably determined by such Lender, of (i) its cost of
obtaining the funds for the Loan being paid, prepaid, converted or not borrowed,
refinanced, converted or continued or not paid or prepaid (assumed to be the
Adjusted LIBO Rate applicable thereto) for the period from the date of such
payment, prepayment, conversion or failure to borrow, refinance, convert or
continue or failure to pay or prepay to the last day of the Interest Period for
such Loan (or, in the case of a failure to borrow, refinance, convert or
continue, the Interest Period for such Loan which would have commenced on the
date of such failure) over (ii) the amount of interest (as reasonably determined
by such Lender) that would be realized by such Lender in reemploying the funds
so paid, prepaid, converted or not borrowed, refinanced, converted or continued
for such period or Interest Period, as the case may be based 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 Business Day of such
Interest Period). A certificate of any Lender setting forth any amount or
amounts which such Lender is entitled to receive pursuant to this Section 2.15
shall be delivered to the Borrower and shall be conclusive absent manifest
error. The Borrower shall pay each Lender the amount shown as due on any such
certificate delivered by it within 10 days after its receipt of the same.
Section 2.16 Pro Rata Treatment. Except as required under Section 2.13
or 2.14 and by the terms of this Agreement requiring pro rata treatment with
Facility B, each Borrowing, each payment or prepayment of principal of any
Borrowing, each payment of interest on the Loans, each payment of the Commitment
Fees, each reduction of the Commitments, each payment in respect of
participations in Letter of Credit Disbursements and each refinancing of any
Borrowing with, conversion of any Borrowing to, or continuation of any Borrowing
as a Borrowing of any Type shall be allocated pro rata among the Lenders in
accordance with their respective Commitments of the applicable Class (or, if
such Commitments shall have expired or been terminated, in accordance with the
respective principal amounts of their outstanding Loans of the applicable
Class). Each Lender agrees that in computing such Lender's portion of any
Borrowing to be made hereunder, the Administrative Agent may, in its discretion,
round each Lender's percentage of such Borrowing, computed in accordance with
Schedule 1.01A, to the next higher or lower whole dollar amount.
42
Section 2.17 Sharing of Setoffs. Each Lender agrees that if it shall,
through the exercise of a right of banker's lien, setoff or counterclaim against
the Borrower, or pursuant to a secured claim under Section 506 of Title 11 of
the United States Code or other security or interest arising from, or in lieu
of, such secured claim, received by such Lender under any applicable bankruptcy,
insolvency or other similar law or otherwise (except pursuant to Section 2.20),
or by any other means, obtain payment (voluntary or involuntary) in respect of
any Loan or Loans as a result of which the unpaid principal portion of its Loans
of any Class shall be proportionately less than the unpaid principal portion of
the Loans of such Class of any other Lender, it shall be deemed simultaneously
to have purchased from such other Lender at face value, and shall promptly pay
to such other Lender the purchase price for, a participation in such Loans of
such other Lender, so that the aggregate unpaid principal amount of the Loans
and participations in Loans of any Class held by each Lender shall be in the
same proportion to the aggregate unpaid principal amount of all Loans of such
Class then outstanding as the principal amount of its Loans of such Class prior
to such exercise of banker's lien, setoff or counterclaim or other event was to
the principal amount of all Loans of such Class outstanding prior to such
exercise of banker's lien, setoff or counterclaim or other event; provided,
however, that if any such purchase or purchases or adjustments shall be made
pursuant to this Section 2.17 and the payment giving rise thereto shall
thereafter be recovered, such purchase or purchases or adjustments shall be
rescinded to the extent of such recovery and the purchase price or prices or
adjustment restored without interest (unless the party from which such recovery
is made is obligated by law to pay interest on the amount recovered, in which
case each of the Lenders shall be responsible for its pro rata share of such
interest). The Borrower expressly consents to the foregoing arrangements and
agrees that any Lender holding a participation in a Loan deemed to have been so
purchased may exercise any and all rights of banker's lien, setoff or
counterclaim with respect to any and all moneys owing by the Borrower to such
Lender by reason thereof as fully as if such Lender had made a Loan directly to
the Borrower in the amount of such participation.
Section 2.18 Payments. (a) The Borrower shall make each payment
(including principal of or interest on any Borrowing or any Fees or other
amounts) hereunder or under any other Loan Document not later than 12:00 (noon),
Boston time, on the date when due in dollars to the Administrative Agent at its
offices at 000 Xxxxxxx Xxxxxx, Xxxxxx, Xxxxxxxxxxxxx 00000, in immediately
available funds. Any such payment received after such time on any date shall be
deemed made on the next Business Day.
(b) Whenever any payment (including principal of or interest on any
Borrowing or any Fees or other amounts) hereunder or under any other Loan
Document shall become due, or otherwise would occur, on a day that is not a
Business Day, such payment may be made on the next succeeding Business Day, and
such extension of time shall in such case be included in the computation of
interest or Fees, if applicable.
Section 2.19 Taxes. (a) All payments made by the Borrower under this
Agreement, the Notes and the Letters of Credit shall be made free and clear of,
and without deduction or withholding for or on account of, any present or future
income, stamp, documentary, excise, property or other taxes, levies, imposts,
duties, charges, assessments, fees, deductions or withholdings, now or hereafter
imposed, levied, collected, withheld or assessed by any
43
Governmental Authority, excluding net income taxes and franchise taxes (imposed
in lieu of net income taxes) imposed on the Administrative Agent, the
Documentation Agent or any Lender as a result of a present or former connection
between the Administrative Agent, the Documentation Agent or such Lender and the
jurisdiction of the Governmental Authority imposing such tax or any political
subdivision or taxing authority thereof or therein (other than any such
connection arising solely from the Administrative Agent, the Documentation Agent
or such Lender having executed, delivered or performed its obligations or
received a payment under, or enforced, this Agreement, the Notes or any Letters
of Credit). If any such non-excluded taxes, levies, imposts, duties, charges,
fees deductions or withholdings ("Non-Excluded Taxes") are required to be
withheld from any amounts payable to the Administrative Agent, the Documentation
Agent or any Lender hereunder or under the Notes or any Letters of Credit, the
amounts so payable to the Administrative Agent, the Documentation Agent or such
Lender shall be increased to the extent necessary to yield to the Administrative
Agent, the Documentation Agent or such Lender (after payment of all Non-Excluded
Taxes) interest or any such other amounts payable hereunder at the rates or in
the amounts specified in this Agreement, the Notes and any Letters of Credit,
provided, however, that the Borrower shall not be required to increase any such
amounts payable to any Lender that is not organized under the laws of the United
States of America or a state thereof if such Lender fails to comply with the
requirements of Section 2.19(b). Whenever any Non-Excluded Taxes are payable by
the Borrower, as promptly as possible thereafter the Borrower shall send to the
Administrative Agent for its own account or for the account of the Documentation
Agent or such other Lender, as the case may be, a certified copy of an original
official receipt received by the Borrower showing payment thereof. If the
Borrower fails to pay any Non-Excluded Taxes when due to the appropriate taxing
authority or fails to remit to the Administrative Agent the required receipts or
other required documentary evidence, the Borrower shall indemnify the
Administrative Agent, the Documentation Agent and the Lenders for any
incremental taxes, interest or penalties that may become payable by the
Administrative Agent, the Documentation Agent or any Lender as a result of any
such failure.
(b) Each Lender that is not incorporated under the laws of the United
States of America or a state thereof shall:
(i) deliver to the Borrower and the Administrative Agent (A)
two duly completed copies of United States Internal Revenue Service
Form 1001 or 4224, or successor applicable form, as the case may be,
and (B) an Internal Revenue Service Form W-8 or W-9, or successor
applicable form, as the case may be;
(ii) deliver to the Borrower and the Administrative Agent two
further copies of any such form or certification on or before the date
that any such form or certification expires or becomes obsolete and
after the occurrence of any event requiring a change in the most recent
form previously delivered by it to the Borrower; and
(iii) obtain such extensions of time for filing and completing
such Forms or certifications as may reasonably be requested by the
Borrower or the Administrative Agent;
44
unless in any such case an event (including any change in treaty, law or
regulation) has occurred prior to the date on which any such delivery would
otherwise be required which renders all such forms inapplicable or which would
prevent such Lender from duly completing and delivering any such form with
respect to it and such Lender so advises the Borrower and the Administrative
Agent. Such Lender shall certify (x) in the case of a Form 1001 or 4224, that it
is entitled to receive payments under this Agreement without deduction or
withholding of any United States Federal income taxes and (y) in the case of a
Form W-8 or W-9, that it is entitled to an exemption from United States backup
withholding tax. Each Person that shall become a Lender or a participant
pursuant to Section 9.04 shall, upon the effectiveness of the related transfer,
be required to provide all of the forms and statements required pursuant to this
Section 2.19, provided that, in the case of a participant, such participant
shall furnish all such required forms and statements to the Lender from which
the related participation shall have been purchased.
(c) The provisions of this Section 2.19 shall remain operative and in
full force and effect regardless of the expiration of the term of this
Agreement, the consummation of the transactions contemplated hereby, the
repayment of any of the Loans, the invalidity or unenforceability of any term or
provision of this Agreement or any other Loan Document, or any investigation
made by or on behalf of any Agent or any Lender.
(d) Any Agent or Lender claiming any indemnity payment or additional
amounts payable pursuant to this Section 2.19 shall use reasonable efforts
(consistent with legal and regulatory restrictions) to file any certificate or
document reasonably requested in writing by the Borrower or to change the
jurisdiction of its applicable lending office if the making of such a filing or
change would avoid the need for or reduce the amount of any such indemnity
payment or additional amounts that may thereafter accrue and would not, in the
sole determination of such Agent or Lender, be otherwise disadvantageous to such
Lender.
(e) Nothing contained in this Section 2.19 shall require any Agent or
Lender to make available any of its tax returns (or any other information that
it deems to be confidential or proprietary).
(f) No Lender shall be entitled to claim any indemnity payment or
additional amount payable pursuant to this Section 2.19 with respect to any tax
unless such Lender shall have notified the Borrower that it will demand
compensation for such payment or amount not more than 120 days after the later
of (i) such date and (ii) the date on which such Lender becomes aware of the
costs or reductions giving rise to such claim. Failure on the part of any Lender
to demand any indemnity payment or any such additional amount with respect to
any period shall not constitute a waiver of such Lender's right to demand
compensation with respect to any other period. The protection of this Section
2.19 shall be available to each Lender regardless of any possible contention of
the invalidity or inapplicability of the law, rule, regulation, guideline or
other change, condition or circumstances which shall have occurred or been
imposed.
Section 2.20 Assignment of Commitments Under Certain Circumstances. In
the event that any Lender shall have delivered a notice or certificate pursuant
to Section 2.13 or 2.14, or the Borrower shall be required to pay additional
amounts to any Lender under Section 2.19, the Borrower shall have the right, at
its own expense, upon notice to such Lender and the
45
Administrative Agent, to require such Lender to transfer and assign without
recourse (in accordance with and subject to the provisions set forth in Section
9.04, including clause (v) of the proviso to Section 9.04(b)) all its interests,
rights and obligations under this Agreement to another financial institution
designated by the Borrower which shall assume such obligations; provided that
(i) a similar assignment by such Lender be made under the Existing Credit
Agreement of all its interests, rights and obligations under the Existing Credit
Agreement, (ii) no such assignment shall conflict with any law, rule, regulation
or order of any Governmental Authority and (iii) the Borrower shall pay to the
affected Lender (and shall take the same actions under the Existing Credit
Agreement) in immediately available funds on the date of such assignment the
entire amount of principal of and interest accrued to the date of payment on the
Loans and participations in Letter of Credit Disbursements made by it hereunder
and all other amounts accrued for its account or owed to it hereunder; provided
further that if prior to any such assignment the circumstances or event that
resulted in such Lender's notice or certificate under Section 2.13 or 2.14 or
demand for additional amounts under Section 2.19, as the case may be, shall
cease to exist or become inapplicable for any reason or if such Lender shall
waive its rights in respect of such circumstances or event under Section 2.13,
2.14 or 2,19, as the case may be, then such Lender shall not thereafter be
required to make any such assignment hereunder or under the Existing Credit
Agreement.
Section 2.21 Letters of Credit. (a) [Intentionally Omitted].
(b) The Borrower may request the issuance of Letters of Credit, in a
form reasonably acceptable to the Administrative Agent and the Issuing Bank, for
the account of the Borrower, at any time and from time to time during the
Revolving Credit Availability Period; provided that any Letter of Credit shall
be issued only if, and each request by the Borrower for the issuance of any
Letter of Credit shall be deemed a representation and warranty by the Borrower
that, immediately following the issuance of such Letter of Credit, the sum of
(i) the Letter of Credit Exposure and (ii) the aggregate principal amount of
outstanding Revolving Loans shall not exceed the aggregate amount of the
Revolving Credit Commitments at such time, provided, however, that the amount of
all outstanding Tranche B Letters of Credit (as defined in the Existing Credit
Agreement) and the Letters of Credit shall not exceed $12,500,000. Each Letter
of Credit shall expire at the close of business on the Maturity Date, unless
such Letter of Credit expires by its terms on an earlier date. Each Letter of
Credit shall provide for payments of drawings in dollars.
(c) Each issuance of any Letter of Credit shall be made on at least two
Business Days' prior irrevocable written or telecopy notice (or such shorter
notice as shall be acceptable to the Issuing Bank) from the Borrower to the
Administrative Agent and the Issuing Bank specifying, on the Issuing Bank's
standard form or on such other form as is acceptable to the Issuing Bank, the
date of issuance, the date on which such Letter of Credit is to expire, the
amount of such Letter of Credit, the name and address of the beneficiary of such
Letter of Credit, and such other information as may be necessary or desirable to
complete such Letter of Credit. The Issuing Bank will give the Administrative
Agent prompt notice of the issuance and amount of such Letter of Credit and the
expiration date of such Letter of Credit (and the Administrative Agent shall
give prompt notice thereof to each Lender). The Issuing Bank also will give the
Administrative Agent (i) daily notice of the amount available to be drawn under
each outstanding
46
Letter of Credit and (ii) a quarterly summary indicating, on a daily basis
during such quarter, the issuance of any Letter of Credit and the amount
thereof, the expiration of any Letter of Credit and the amount thereof and the
payment on any draft presented under any Letter of Credit. The Administrative
Agent will promptly provide the Lenders with copies of each such quarterly
summary.
(d) By the issuance of a Letter of Credit and without any further
action on the part of the Issuing Bank, the Administrative Agent or the Lenders
in respect thereof, the Issuing Bank hereby grants to each Lender, and each
Lender hereby acquires from the Issuing Bank, effective upon the issuance of
such Letter of Credit, a participation in such Letter of Credit equal to such
Lender's pro rata share (based on such Lender's Revolving Credit Commitment
Percentage) of the aggregate amount available to be drawn under such Letter of
Credit. In consideration and in furtherance of the foregoing, each Lender hereby
absolutely and unconditionally agrees to pay to the Administrative Agent, on
behalf of the Issuing Bank, in accordance with Section 2.02(d), such Lender's
pro rata share (based on such Lender's Revolving Credit Commitment Percentage)
of each Letter of Credit Disbursement made by the Issuing Bank and not
reimbursed by the Borrower when due in accordance with Section 2.21(g); provided
that the Lenders shall not be obligated to make any such payment with respect to
any wrongful Letter of Credit Disbursement made as a result of the gross
negligence or wilful misconduct of the Issuing Bank.
(e) Each Lender acknowledges and agrees that its obligation to acquire
participations pursuant to Section 2.21(d) in respect of Letters of Credit is
absolute and unconditional and shall not be affected by any circumstance
whatsoever, including the occurrence and continuance of a Default or Event of
Default, and that each such payment shall be made without any offset, abatement,
withholding or reduction whatsoever (subject only to the proviso set forth in
Section 2.21(d)).
(f) During the Revolving Credit Availability Period, the Borrower shall
pay to the Administrative Agent, on the last day of March, June, September and
December in each year and on the date on which the Revolving Credit Commitments
shall be terminated as provided herein, (i) for the account of the Lenders,
ratably in proportion to their Revolving Credit Commitments, a fee on the
average daily aggregate amount available to be drawn under all outstanding
Letters of Credit during the preceding quarter (or shorter period commencing
with the date of this Agreement) at a rate per annum equal to the Applicable
Eurodollar Margin from time to time in effect during such period pursuant to
Section 2.06 and (ii) for the account of the Issuing Bank, a fee on the average
daily aggregate amount available to be drawn under all outstanding Letters of
Credit during the preceding quarter (or shorter period commencing with the date
of this Agreement) at a rate per annum equal to 0.125%. Such fees shall be
computed on the basis of the actual number of days elapsed in a year of 360
days. Such fees shall accrue from and including the date of this Agreement to
but excluding the last day of the Revolving Credit Availability Period. In
addition to the foregoing, the Borrower shall pay directly to the Issuing Bank,
for its account, payable within 15 days after demand therefor by the Issuing
Bank, the Issuing Bank's customary processing and documentation fees in
connection with the issuance or amendment of or payment on any Letter of Credit.
47
(g) The Borrower hereby agrees to reimburse the Issuing Bank for any
payment or disbursement made by the Issuing Bank under any Letter of Credit, by
making payment in immediately available funds to the Administrative Agent within
one Business Day after receipt of notice of such payment or disbursement, in an
amount equal to the amount of such payment or disbursement, plus interest on the
amount so paid or disbursed by the Issuing Bank, to the extent not reimbursed
prior to 3:00 p.m. (Boston time) on the date of such payment or disbursement,
from and including the date paid or disbursed to but excluding the date the
Issuing Bank is reimbursed by the Borrower therefor, at a rate per annum equal
to the rate applicable to ABR Revolving Loans during such period pursuant to
Section 2.06. If the Borrower shall fail to pay any amount required to be paid
by it under this Section 2.21(g) when due, such unpaid amount shall bear
interest as provided in Section 2.07. The Issuing Bank shall give the Borrower
prompt notice of each drawing under any Letter of Credit, provided that the
failure to give any such notice shall in no way affect, impair or diminish the
Borrower's obligations hereunder. The Administrative Agent shall promptly pay
any such amounts received by it to the Issuing Bank.
(h) The Borrower's obligation to reimburse Letter of Credit
Disbursements as provided in Section 2.21(g) shall be absolute, unconditional
and irrevocable and shall be performed strictly in accordance with the terms of
this Agreement under any and all circumstances whatsoever, and irrespective of:
(i) any lack of validity or enforceability of any Letter of
Credit or any other Loan Document;
(ii) the existence of any claim, setoff, defense or other
right which the Borrower, any Subsidiary or any other Person may at any
time have against the beneficiary under any Letter of Credit, the
Issuing Bank, any Agent, any Lender or any other Person in connection
with this Agreement, any other Loan Document or any other related or
unrelated agreement or transaction;
(iii) any draft or other document presented under a Letter of
Credit proving to be forged, fraudulent, invalid or insufficient in any
respect or failing to comply with the Uniform Customs and Practices for
Documentary Credits, as in effect from time to time, or any statement
therein being untrue or inaccurate in any respect;
(iv) payment by the Issuing Bank under a Letter of Credit
against presentation of a draft or other document which does not comply
with the terms of such Letter of Credit; provided that such payment was
not wrongfully made as a result of the gross negligence or wilful
misconduct of the Issuing Bank; and
(v) any other act or omission or delay of any kind or any
other circumstance or event whatsoever, whether or not similar to any
of the foregoing and whether or not foreseeable, that might, but for
the provisions of this Section 2.21(h), constitute a legal or equitable
discharge of the Borrower's obligations hereunder.
(i) It is expressly understood and agreed that, for purposes of
determining whether a wrongful payment under a Letter of Credit resulted from
the Issuing Bank's gross negligence or
48
wilful misconduct, (i) the Issuing Bank's acceptance of documents that appear on
their face to be in order, without responsibility for further investigation,
regardless of any notice or information to the contrary, (ii) the Issuing Bank's
exclusive reliance on the documents presented to it under such Letter of Credit
as to any and all matters set forth therein, including the amount of any draft
presented under such Letter of Credit, whether or not the amount due to the
beneficiary thereunder equals the amount of such draft and whether or not any
document presented pursuant to such Letter of Credit proves to be insufficient
in any respect (so long as such document on its face appears to be in order),
and whether or not any other statement or any other document presented pursuant
to such Letter of Credit proves to be forged or invalid or any statement therein
proves to be inaccurate or untrue in any respect whatsoever and (iii) any
noncompliance in any immaterial respect of the documents presented under such
Letter of Credit with the terms thereof shall, in each case, be deemed not to
constitute wilful misconduct or gross negligence of the Issuing Bank. It is
further understood and agreed that, notwithstanding the proviso to clause (iv)
of Section 2.21(h), the Borrower's obligation hereunder to reimburse Letter of
Credit Disbursements will not be excused by the gross negligence or wilful
misconduct of the Issuing Bank to the extent that such Letter of Credit
Disbursement actually discharged a liability of, or otherwise benefited, or was
recovered by, the Borrower; provided that the foregoing shall not be construed
to excuse the Issuing Bank from liability to the Borrower to the extent of any
direct damages suffered by the Borrower that are caused by the Issuing Bank's
gross negligence or wilful misconduct in determining whether drafts and other
documents presented under a Letter of Credit comply with the terms thereof.
(j) The Issuing Bank shall, promptly following its receipt thereof,
examine all documents purporting to represent a demand for payment under a
Letter of Credit, including as to compliance with the Uniform Customs and
Practices for Documentary Credits, as then in effect. The Issuing Bank shall as
promptly as possible give telephonic notification, confirmed by telex or
telecopy, to the Administrative Agent and the Borrower of such demand for
payment and whether the Issuing Bank has made or will make a Letter of Credit
Disbursement thereunder, provided that the failure to give such notice shall not
relieve the Borrower of its obligation to reimburse any such Letter of Credit
Disbursement in accordance with this Section 2.21. The Administrative Agent
shall promptly give each Lender notice thereof.
(k) In the event that the Borrower is required or elects pursuant to
the terms of this Agreement (other than Sections 2.11(h) and 7.01) to provide
cash collateral in respect of the Letter of Credit Exposure of any Class, the
Borrower shall deposit in an account with the Administrative Agent an amount in
cash equal to the Letter of Credit Exposure of such Class (or such lesser amount
as shall be required or elected hereunder). Any such deposit shall be held by
the Administrative Agent in accordance with the Cash Collateral Agreement. In
the event that the Borrower is required pursuant to the terms of Section 2.11(h)
or Section 7.01 of this Agreement to provide cash collateral in respect of the
Letter of Credit Exposure of any Class, the Borrower shall deposit such cash
collateral in an account with the Trustee pursuant to the Trust Agreement. Such
deposit shall be held by the Trustee in accordance with the Trust Agreement. Any
such deposit to be held by the Administrative Agent or the Trustee, as provided
herein, shall be accompanied by notice from the Borrower, in form satisfactory
to the Administrative Agent or the Trustee, as the case may be, setting forth
the basis for such deposit, identifying in reasonable detail the Letters of
Credit to which such deposit relates, and setting forth any other
49
information related to such deposit reasonably requested by the Administrative
Agent or the Trustee, as the case may be. The Borrower shall promptly provide
the Administrative Agent with a copy of any such notice to the Trustee and shall
promptly provide the Trustee with a copy of any such notice to the Borrower.
ARTICLE III
REPRESENTATIONS AND WARRANTIES
The Borrower represents and warrants to each of the Lenders that:
Section 3.01 Organization; Powers. Each of the Borrower and the Loan
Parties (a) is a limited partnership (in the case of the Borrower and the Public
Partnership) or a limited liability company or a corporation (in the case of the
other Loan Parties) duly organized, validly existing and in good standing under
the laws of the jurisdiction of its organization, (b) has all requisite power
and authority to own its property and assets and to carry on its business as now
conducted and as proposed to be conducted, (c) is duly qualified or registered
to do business and is in good standing as a foreign limited partnership (in the
case of the Borrower and the Public Partnership) or a limited liability company
or corporation (in the case of the other Loan Parties) in all jurisdictions in
which the nature of their respective activities or the character of the
properties they own, lease or use makes such qualification or registration
necessary and in which the failure so to qualify or to be so registered would
have a Material Adverse Effect (and the only such jurisdictions are, in the case
of the Borrower and the Public Partnership, Connecticut, Indiana, Illinois,
Kentucky, Maine, Massachusetts, Michigan, New Hampshire, New Jersey, New York,
Ohio, Pennsylvania, Rhode Island, Texas and West Virginia) and (d) has the power
and authority to execute, deliver and perform its obligations under each of the
Loan Documents and each other agreement or instrument contemplated thereby to
which it is or will be a party, to consummate the transactions contemplated
hereunder and, in the case of the Borrower, to obtain extensions of credit
hereunder.
Section 3.02 Authorization. The execution, delivery and performance by
each of the Borrower and the Loan Parties of each of the Loan Documents to which
it is or will be a party, the consummation of the transactions contemplated
hereunder and, in the case of the Borrower, the extensions of credit hereunder
(a) have been duly authorized by all requisite action and (b) will not (i)
violate (A) any provision of law, statute, rule or regulation, or of the
agreement of limited partnership, operating agreement, articles of incorporation
or other constitutive documents or by-laws of the Borrower and the other Loan
Parties, (B) any order of any Governmental Authority or (C) any provision of any
indenture, agreement or other instrument, including, without limitation, the
Existing Credit Agreement, the Note Agreement or the Parity Debt Agreements to
which the Borrower or any of the other Loan Parties is a party or by which any
of them or any of their property is or may be bound, (ii) be in conflict with,
result in a breach of or constitute (alone or with notice or lapse of time or
both) a default or give rise to increased, additional, accelerated or guaranteed
rights of any Person under any such indenture, agreement or other instrument,
including, without limitation, the Existing Credit Agreement, the Note Agreement
or the Parity Debt Agreements or (iii) except for the Lien of the Collateral
50
Documents, result in the creation or imposition of any Lien upon or with respect
to any property or assets now owned or hereafter acquired by the Borrower or any
of the other Loan Parties.
Section 3.03 Enforceability. This Agreement has been duly executed and
delivered by the Borrower and constitutes, and each other Loan Document when
executed and delivered by the Borrower or any of the other Loan Parties does or
will constitute, the legal, valid and binding obligation of such party
enforceable against such party in accordance with its terms.
Section 3.04 Consents and Governmental Approvals. No consent or
approval of, registration or filing with or any other action by (a) any
Governmental Authority, (b) any creditor, including, without limitation, any
creditor or holder under the Existing Credit Agreement, the Note Agreement or
the Parity Debt Agreements, or holder of any Capital Stock of the Borrower, any
of the other Loan Parties or any Affiliate thereof or (c) any other Person is or
will be required in connection with the transactions contemplated hereby, the
Facility or the performance by the Borrower or any of the other Loan Parties of
the Loan Documents to which it is or will be a party, in each case except such
as have been made or obtained and are in full force and effect.
Section 3.05 Business; Financial Statements. (a) As of the Closing
Date, the Business (as conducted by the Star Gas Group) does not include, and
has never included (whether conducted by the Star Gas Group or any of its
predecessors) the sale, distribution or storage of any petroleum derivative
product (other than propane gas and other than storage of diesel fuel and motor
oil used for vehicles of the Star Gas Group), except on premises listed on
Schedule 3.05(a).
(b) [Intentionally Omitted].
(c) The Borrower has delivered to the Agents the unaudited pro forma
balance sheet of the Borrower as of December 31, 2001. Such balance sheet
presents fairly the financial condition of the Borrower as of that date in
accordance with GAAP.
(d) The Borrower has heretofore furnished to the Lenders (i) the
balance sheet of the Public Partnership as of September 30, 2001] and (ii) the
combined balance sheets of Star Gas Group as of September 30, 2001 and the
related combined statements of operations and cash flows for each of the years
in the three-year period ended September 30, 2001, in each case audited by and
accompanied by the opinion of KPMG LLP, independent public accountants (the
financial statements referred to in clauses (i) and (ii) above, collectively,
the "Audited Financial Statements"). The Audited Financial Statements present
fairly in accordance with GAAP the combined financial position and the combined
results of operations and cash flows of the Star Gas Group as of such dates and
for such periods. Except as set forth on Schedule 3.05(d), the balance sheets
and the notes thereto included in the Audited Financial Statements disclose all
material liabilities, actual or contingent, of the Star Gas Group as of the
dates thereof. Except as set forth on Schedule 3.05(d) and except for
liabilities incurred in the ordinary course of business since the date thereof
(none of which, individually or in the aggregate, would have a Material Adverse
Effect), the unaudited pro forma balance sheet of the Borrower referred to in
paragraph (c) above discloses all material liabilities actual or contingent of
the Borrower as of the Closing
51
Date. Notwithstanding the foregoing representation made in the two immediately
preceding sentences, such representation will be deemed breached (except for
purposes of Article IV hereof) only to the extent that such representation
involves undisclosed liabilities which could reasonably be expected,
individually or in the aggregate, to have a Material Adverse Effect. The Audited
Financial Statements were prepared in accordance with GAAP applied on a
consistent basis during the periods involved (except as may be indicated in the
notes thereto).
Section 3.06 No Material Adverse Change. As of the Closing Date, there
has occurred since December 31, 2001, no material adverse change, and there
exists no condition, event or occurrence that, individually or in the aggregate,
could reasonably be expected to result in a material adverse change, in the
business, operations, property or condition (financial or otherwise) of the Star
Gas Group. Since the date of this Agreement, there has occurred no condition,
event or other occurrence that, individually or in the aggregate, has had, and
there exists no condition, event or other occurrence, that, individually or in
the aggregate, could reasonably be expected to have, a Material Adverse Effect.
Section 3.07 Title to Properties; Possession Under Leases. (a) The
Borrower and the Restricted Subsidiaries will own or hold valid leasehold
interests in all the properties and assets used in the operation of the
Business, except for properties and assets set forth on Schedule 3.07. None of
the properties and assets set forth on Schedule 3.07 is material to the
Business. Each of the Borrower and the Restricted Subsidiaries has good and
marketable title to, or valid leasehold interests in, all its properties and
assets, free and clear of Liens, except for (i) minor defects in title that do
not interfere with its ability to conduct its business as currently conducted or
to utilize such properties and assets for their intended purposes and (ii) Liens
permitted by Section 6.02.
(b) Schedule 3.07 sets forth, as of the Closing Date, a true, complete
and correct list of (i) all real property owned by the Borrower and the
Restricted Subsidiaries; (ii) all real property leased by the Borrower or any
Restricted Subsidiary; and (iii) the location and use of each such property.
(c) Each of the Borrower and the Restricted Subsidiaries has complied
with all obligations under all material leases to which it is a party and all
such leases are in full force and effect. Each of the Borrower and the
Restricted Subsidiaries enjoys peaceful and undisturbed possession under all
such material leases.
Section 3.08 Subsidiaries. Schedule 3.08 sets forth as of the Closing
Date a list of all the Subsidiaries, the respective jurisdictions of
organization thereof and the percentage ownership interest, direct or indirect,
of the Borrower therein.
Section 3.09 Litigation; Compliance with Laws. (a) Except as set forth
in Schedule 3.09, there are no actions, suits or proceedings at law or in equity
or by or before any Governmental Authority now pending or, to the knowledge of
the Borrower, threatened against or affecting the Borrower, any other Loan Party
or any business, property or rights of the Borrower or any other Loan Party (i)
which involve any Loan Document or the transactions contemplated by this
Agreement or (ii) as to which there is a reasonable possibility of an adverse
52
determination and which, if adversely determined, could be reasonably expected
to result, individually or in the aggregate, in a Material Adverse Effect.
(b) Neither the Borrower nor any other Loan Party is in violation of
any law, rule or regulation, or in default with respect to any judgment, writ,
injunction or decree, of any Governmental Authority, where such violation or
default could be reasonably expected to result, individually or in the
aggregate, in a Material Adverse Effect. Except as set forth in Schedule 3.09,
neither the Borrower nor any other Loan Party has received any written
communication during the past three years from any Governmental Authority that
alleges that the Borrower or any other Loan Party or the Business is not in
compliance in any material respect with any law, rule or regulation or any
judgment, writ, injunction or decree.
Section 3.10 Agreements. Neither the Borrower nor any of the other Loan
Parties is a party to any agreement or instrument or subject to any corporate
restriction that has resulted or could reasonably be expected to result,
individually or in the aggregate, in a Material Adverse Effect. As of the date
of this Agreement, neither the Borrower nor any of the Restricted Subsidiaries
is a party to any Material Contract and none of the assets or properties of the
Borrower or any Loan Party is or may be bound by any Material Contract.
Section 3.11 Federal Reserve Regulations. (a) Neither the Borrower nor
any of the other Loan Parties is engaged principally, or as one of its important
activities, in the business of extending credit for the purpose of purchasing or
carrying Margin Stock.
(b) No part of the proceeds of any Loan and no Letter of Credit will be
used, whether directly or indirectly, and whether immediately, incidentally or
ultimately, for any purpose which entails a violation of, or which is
inconsistent with, the provisions of the regulations of the Board, including
Regulation T, U and X.
Section 3.12 Investment Company Act; Public Utility Holding Company
Act. Neither the Borrower nor any of the other Loan Parties is (a) an
"investment company" as defined in, or subject to regulation under, the
Investment Company Act of 1940, (b) a "holding company" as defined in, or
subject to regulation under, the Public Utility Holding Company Act of 1935 or
(c) subject to regulation as a "public utility" or a "public service
corporation" or the equivalent under any Federal or state law.
Section 3.13 Use of Proceeds. (a) [Intentionally Omitted].
(b) The proceeds of all Revolving Loans will be used solely (i) to fund
the purchase price of any Eligible Propane Acquisition by the Borrower or any
Restricted Subsidiary or to reimburse the Borrower or any Restricted Subsidiary
for cash amounts paid by the Borrower or such Restricted Subsidiary for the
purchase price of any Eligible Propane Acquisition made by the Borrower or such
Restricted Subsidiary within the six-month period immediately preceding the date
of the Borrowing of the Revolving Loans to which such proceeds relate (provided,
in the case of an acquisition of Capital Stock, that the Person so acquired
becomes a Restricted Subsidiary), (ii) to fund Growth-Related Capital
Expenditures and (iii) for the other purposes set forth in Section 6.01(b) of
the Existing Credit Agreement, Section 10.1(b) of the Note
53
Agreement and the comparable provisions in the Parity Debt Agreement, including,
without limitation, to prepay, in whole, the Fleet Parity Note on the Closing
Date. The Letters of Credit will be issued solely to support obligations of the
Borrower incurred in connection with the acquisitions and Growth-Related Capital
Expenditures referred to in this paragraph.
(c) The proceeds of all Term Loans will be used solely to refinance
Revolving Loans outstanding on the Conversion Date.
Section 3.14 Tax Returns. Each of the Borrower and its Affiliates has
filed all tax returns required by law to be filed by it and has paid all taxes,
assessments and other governmental charges levied upon it or any of its
properties, assets, income or franchises which are due and payable, other than
(a) those which are not past due or are presently being contested in good faith
by appropriate proceedings diligently conducted for which such reserves or other
appropriate provisions, if any, as shall be required by GAAP have been made and
(b) in the case of any such Person other than the Borrower and the Restricted
Subsidiaries, those which could not reasonably be expected, individually or in
the aggregate, to have a Material Adverse Effect. The Borrower is a limited
partnership not subject to taxation with respect to its income or gross receipts
under applicable Federal laws. The Borrower is a limited partnership not subject
to taxation with respect to its income or gross receipts under applicable state
laws, except for laws of the states set forth on Schedule 3.14, none of which
would, individually or in the aggregate, have a Material Adverse Effect.
Section 3.15 No Material Misstatements. (a) No information, report,
financial statement, exhibit or schedule furnished by or on behalf of the
Borrower or any of its Affiliates to any Agent or Lender in connection with the
negotiation of any Loan Document or included therein or delivered pursuant
thereto contained, contains or will contain any material misstatement of fact or
omitted, omits or will omit to state any material fact necessary to make the
statements therein, in the light of the circumstances under which they were, are
or will be made, not misleading. There is no fact known to the Borrower which
has or in the future would (so far as the Borrower can now foresee) have a
Material Adverse Effect which has not been set forth in this Agreement
(including the schedules hereto).
(b) All representations and warranties of the Borrower and Star Gas
Corporation set forth in the Note Agreement, the Existing Credit Agreement and
the Twelfth Amendment thereto, and other Parity Debt Agreements were true and
correct on and as of the date of such agreement and will be true and correct in
all material respects on and as of the Closing Date with the same effect as
though made on and as of the Closing Date, except to the extent such
representations and warranties expressly relate to an earlier date (in which
case such representations and warranties were true and correct in all material
respects on and as of such earlier date).
Section 3.16 Employee Benefit Plans. Except as disclosed in Schedule
3.16, none of the General Partner, the Borrower or any Related Person of the
General Partner or the Borrower (other than Petro and any Subsidiaries of Petro
(except for the General Partner that is not a Related Person of the Borrower or
the General Partner as of the Closing Date)) has ever established, maintained,
contributed to or been obligated to contribute to, and neither the
54
Borrower nor any Related Person of the Borrower has any liability or obligation
with respect to, any Plan. Neither the Borrower nor any Related Person of the
Borrower has assumed, either by agreement (including the Partnership Agreement
and the Operative Agreements), by operation of law or otherwise, any liability
or obligation with respect to any "employee benefit plan" (as defined in ERISA)
or any other compensation or benefit arrangement, agreement, policy, practice or
understanding. Neither the Borrower nor any Related Person of the Borrower has
any liability or obligation to provide any amount or type of compensation or
benefit in respect of any employee or former employee of the Business which
relates to periods, services performed or benefits or amounts accrued prior to
the transfer of the Business or the Assets pursuant to the Operative Agreements
and the transactions contemplated thereby. Neither the General Partner, nor the
Borrower nor any Related Person of the Borrower, or the General Partner has
incurred any material liability under Title IV of ERISA with respect to any Plan
and no event or condition exists or has occurred as a result of which such a
liability would reasonably be expected to be incurred. None of the General
Partner, the Borrower nor any Related Person of the General Partner or the
Borrower has engaged in any transaction, including the transactions contemplated
hereunder, which could subject the Borrower or any Related Person of the
Borrower to liability pursuant to Section 4069(a) or 4212(c) of ERISA. There has
been no reportable event (within the meaning of Section 4043(b) of ERISA) or any
other event or condition with respect to any Plan which presents a risk of the
termination of, or the appointment of a trustee to administer, any such Plan by
the PBGC. No prohibited transaction (within the meaning of Section 406(a) of
ERISA or Section 4975 of the Code) exists or has occurred with respect to any
Plan which has subjected or could reasonably be expected to subject the General
Partner or the Borrower to a material liability under Section 502(i) or 502(l)
of ERISA or Section 4975 of the Code. No liability to the PBGC (other than
liability for premiums not yet due) has been or is expected to be incurred with
regard to any Plan by the General Partner, the Borrower or any Related Person.
Neither the General Partner, nor the Borrower nor any Related Person of the
General Partner or the Borrower contributes or is obligated to contribute or has
ever contributed or been obligated to contribute to any single employer plan
that has at least two contributing sponsors not under common control. The
Borrower is not, nor is it expected to become, a "substantial employer" as
defined in Section 4001(a)(2) of ERISA with respect to any Plan. Neither the
General Partner nor the Borrower has ever maintained or contributed to any plan
or arrangement which provides post-employment welfare benefits or coverage
(other than continuation coverage provided pursuant to Section 4980B of the
Code).
Section 3.17 Environmental and Safety Matters. (a) Except as disclosed
in Schedule 3.17, each of the Borrower and the General Partner is in compliance
with all Environmental Laws applicable to it or to the Business, except where
such noncompliance would not have a Material Adverse Effect. The Borrower has
timely and properly applied for renewal of all environmental permits or licenses
that have expired or are about to expire and are necessary for the conduct of
the Business as now conducted and as proposed to be conducted, except where the
failure to timely and properly reapply would not have a Material Adverse Effect.
Schedule 3.17 lists (i) all notices from Federal, state or local environmental
agencies to the Borrower, the General Partner or any Affiliate thereof citing
environmental violations affecting the Business that have not been finally
resolved and disposed of, and no such violation, whether or not notice regarding
such violation is listed on Schedule 3.17, if ultimately resolved against such
party, would have a Material Adverse Effect and (ii) all current reports filed
by the Borrower, the
55
General Partner or any Affiliate thereof with respect to the Business with any
Federal, state or local environmental agency having jurisdiction over the
Business, true and complete copies of which reports have been made available to
the Lenders. Notwithstanding any such notice, except for matters the
consequences of which will not have a Material Adverse Effect, the Business is
currently being operated in all respects within the limits set forth in such
environmental permits or licenses and any current noncompliance with such
permits or licenses will not result in any liability or penalty to the Borrower
or the Subsidiaries or in the revocation, loss or termination of any such
environmental permits or licenses.
(b) Except as disclosed in Schedule 3.17, all facilities located on the
real property owned or leased by the Loan Parties which are subject to
regulation by RCRA are and have been operated in compliance with RCRA, except
where such noncompliance would not have a Material Adverse Effect and none of
the Borrower, the General Partner and their Affiliates has received, or, to the
knowledge of the Borrower, been threatened with, a notice of violation of RCRA
regarding such facilities.
(c) Except as disclosed in Schedule 3.17, no Hazardous Materials are or
have been located or present at any of the real property owned or leased by the
Loan Parties or any previously owned properties in violation of any
Environmental Law, which violation will have a Material Adverse Effect, or in
such circumstances as to give rise to liability, which liability will have a
Material Adverse Effect, and with respect to such real property there has not
occurred (i) any release or threatened release of any such hazardous substance,
(ii) any discharge or threatened discharge of any substance into ground,
surface, or navigable waters which violates any Environmental Law or (iii) any
assertion of any lien pursuant to Environmental Laws resulting from any use,
spill, discharge or clean-up of any hazardous or toxic substance or waste, which
occurrence referred to in clause (i), (ii) or (iii) above will have a Material
Adverse Effect.
(d) The Borrower has not received notice that it has been identified as
a potentially responsible party under CERCLA or any comparable state, local or
foreign law nor has the Borrower received any notification that any Hazardous
Materials that it has used, generated, stored, treated, handled, transported or
disposed of or arranged for transport for disposal or treatment of, or arranged
for disposal or treatment of, has been found at any site at which any
Governmental Authority or private party is conducting or plans to conduct a
remedial investigation or other action pursuant to any Environmental Law.
(e) None of the matters disclosed in Schedule 3.17, either individually
or in the aggregate, involves a violation of or a liability under any
Environmental Law, the consequences of which will have a Material Adverse
Effect.
Section 3.18 Security Interests. The Trustee for the benefit of the
Secured Parties will at all times have the Liens provided for in the Collateral
Documents and, subject to the filing by the Trustee of continuation statements
to the extent required by the Uniform Commercial Code, the Collateral Documents
will at all times constitute a valid and continuing lien of record and first
priority perfected security interest in all the Collateral referred to therein.
No filings or recordings, or amendments or supplements to any of the Collateral
Documents are required in order to perfect the security interests created under
the Collateral Documents, except for
56
amendments, supplements, filings or recordings listed on Schedule 3.18. All such
amendments, supplements, listed filings and recordings were made on or prior to
the Closing Date, except as otherwise expressly provided in Schedule 3.18.
Section 3.19 Solvency. Upon the making of the initial Loan or the
issuance of the initial Letter of Credit hereunder, each of the Borrower and the
Restricted Subsidiaries will be Solvent. "Solvent" means, with respect to any
Person, that (a) the sum of the assets of such Person, both at a fair valuation
and at present fair saleable value, will exceed the liabilities of such Person,
(b) such Person will have sufficient capital with which to conduct its business
as presently conducted and as proposed to be conducted and (c) such Person has
not incurred debts, and does not intend to incur debts, beyond its ability to
pay such debts as they mature. For purposes of the foregoing definition, "debts"
means any liabilities on claims, and "claim" means (i) a right to payment,
whether or not such right is reduced to judgment, liquidated, unliquidated,
fixed, contingent, matured, unmatured, disputed, undisputed, legal, equitable,
secured or unsecured or (ii) a right to an equitable remedy for breach of
performance if such breach gives rise to a payment, whether or not such right to
an equitable remedy is reduced to judgment, fixed, contingent, matured,
unmatured, disputed, undisputed, secured or unsecured. With respect to any
contingent liabilities, such liabilities shall be computed at the amount which,
in light of all the facts and circumstances existing at the time, represents the
amount which can reasonably be expected to become an actual or matured
liability.
Section 3.20 Transactions with Affiliates. Except as set forth in
Schedule 3.20 and except for agreements and arrangements among the Borrower and
Wholly Owned Restricted Subsidiaries or among Wholly Owned Restricted
Subsidiaries, neither the Borrower nor any of the Subsidiaries is a party to,
and none of the properties and assets of the Borrower or any of the Subsidiaries
is subject to or bound by, any agreement or arrangement with, and neither the
Borrower nor any of the Subsidiaries is engaged in any transaction with, (a) any
Affiliate of the Borrower or any of the Subsidiaries or (b) any Affiliate of
Petro or the General Partner.
Section 3.21 Ownership. The only general partner of the Borrower is the
General Partner. The General Partner owns a 0.01% general partnership interest
in the Borrower. The only limited partner of the Borrower is the Public
Partnership. The Public Partnership owns a 99.99% limited partner interest in
the Borrower. The only general partner of the Public Partnership is the General
Partner.
Section 3.22 Insurance. The Borrower and the Subsidiaries maintain with
Permitted Insurers policies of fire and casualty, liability, business
interruption and other forms of insurance in such amounts, with such deductibles
and against such risks and losses as are reasonable for the business and assets
of the Borrower and the Subsidiaries. All such policies are in full force and
effect, all premiums due and payable thereon have been paid (other than
retroactive or retrospective premium adjustments that are not yet, but may be,
required to be paid with respect to any period ending prior to the Closing Date
under comprehensive general liability and workmen's compensation insurance
policies) and no notice of cancellation or termination has been received with
respect to any such policy which has not been replaced on substantially similar
terms prior to the date of such cancellation. The activities and operations of
the Borrower
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and the Subsidiaries have been conducted in a manner so as to conform in all
material respects to all applicable provisions of such insurance policies.
Section 3.23 Labor Relations. Neither the Borrower nor any of the
Subsidiaries is engaged in unfair labor practice that could reasonably be
expected to have, individually or in the aggregate, a Material Adverse Effect.
There is (a) no unfair labor practice complaint pending against the Borrower or
any of the Subsidiaries or affecting the Business or, to the knowledge of the
Borrower, threatened against any of them, before the National Labor Relations
Board, (b) no grievance or arbitration proceeding arising out of or under any
collective bargaining agreement pending against the Borrower or any of the
Subsidiaries or affecting the Business or, to the knowledge of the Borrower,
threatened against any of them, (c) no strike, labor dispute, slowdown or
stoppage pending against the Borrower or any of the Subsidiaries or, to the
knowledge of the Borrower, threatened against the Borrower or any of the
Subsidiaries, (d) to the knowledge of the Borrower, no union representation
question existing with respect to the employees of the Borrower or any of the
Subsidiaries and (e) to the knowledge of the Borrower, no union organizing
activities are taking place.
Section 3.24 Changes, etc. Except as contemplated by this Agreement or
the other Loan Documents, the Borrower and the other Loan Parties have not
incurred any material liabilities or obligations, direct or contingent, or
entered into any material transaction not in the ordinary course of business,
and no events have occurred which, individually or in the aggregate, could have
a Material Adverse Effect, and there has not been any Restricted Payment of any
kind declared, paid or made by the Borrower or the General Partner.
Section 3.25 Indebtedness. Other than the Indebtedness represented by
the Mortgage Notes, the Notes (as defined in the Existing Credit Agreement),
1998 Parity Notes, 2000 Parity Notes, 2001 Parity Notes and the Fleet Parity
Note (which Fleet Parity Note shall be paid in whole on the Closing Date),
incurred hereunder, none of the Borrower and the Restricted Subsidiaries has any
secured or unsecured Indebtedness outstanding as of the Closing Date. As of the
Closing Date, no instrument or agreement to which the Borrower or any of the
Subsidiaries is a party or by which the Borrower or any of the Subsidiaries is
bound or which is applicable to the Borrower or any of the Subsidiaries (other
than this Agreement, the Note Agreement, the Existing Credit Agreement, the
other Parity Debt Agreements and Fleet Parity Note) contains any restrictions on
the incurrence by the Borrower or any of the Subsidiaries of additional
Indebtedness.
Section 3.26 Business. (a) The Borrower is in possession of and
operating in compliance in all respects with all franchises, grants,
authorizations, approvals, licenses, permits, easements, rights-of-way,
consents, certificates and orders required to own, lease or use its properties
and to permit the conduct of the Business as now conducted and proposed to be
conducted, except for those franchises, grants, authorizations, approvals,
licenses, permits, easements, rights-of-way, consents, certificates and orders
(collectively, "Permitted Exceptions") (i) which are not required at this time
and are routine or administrative in nature and are expected in the reasonable
judgment of the Borrower to be obtained or given in the ordinary course of
business after the Closing Date, or (ii) which, if not obtained or given, would
not, individually or in the aggregate, have a Material Adverse Effect.
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(b) The Borrower has good and marketable title to all of its assets and
properties, subject to no Liens except those permitted under Section 6.02. The
Assets currently owned by the Borrower are all of the assets and properties
necessary to enable the Borrower to conduct the Business.
(c) (i) Star Gas Corporation has transferred to the Borrower beneficial
and (except in the case of motor vehicles covered by certificates of title where
the certificates of title have been duly executed in favor of the Borrower, the
Lien of the Trustee has been duly provided for thereon and such certificates of
title have been delivered to the Borrower and/or the Trustee), record ownership
of all properties (including trademarks, tradenames and other intellectual
property used in the Business), easements and licenses comprising the Business
and (ii) the Collateral Documents (other than the Trust Agreement), or proper
notices, statements or other instruments in respect thereof, have been duly
recorded, published, registered and filed as required by Section 4.01(d). The
Borrower holds all right, title and interest in and to the trade name "Star Gas"
necessary to conduct the Business, and all other trademarks and trade names used
in the Business and holds exclusive right, title and interest in and to all
customer lists used in the Business.
Section 3.27 Chief Executive Office. The chief executive office of the
Borrower and the General Partner and the office where each maintains its records
relating to the transactions contemplated by the Operative Agreements are
located at 0000 Xxxxxxxx Xxxxxx, Xxxxxxxx, XX 00000. The Borrower is only
organized in the State of Delaware and "Star Gas Propane, L.P." is the name as
it appears in official filings in the State of Delaware. The General Partner is
only organized in the State of Delaware and "Star Gas LLC" is the name as it
appears in official filings.
Section 3.28 Fixed Price Supply Contracts. None of the Borrower and the
Restricted Subsidiaries is a party to any contract for the purchase or supply by
such parties of propane or other product except where (a) the purchase price is
set with reference to a spot index or indices substantially contemporaneously
with the delivery of such product or (b) delivery of such propane or other
product is to be made no more than one year after the purchase price is agreed
to. All such contracts referred to in the foregoing clause (b) which are in
effect on the Closing Date are set forth in Schedule 3.28.
Section 3.29 Trading and Inventory Policies. The Borrower maintains a
trading policy to the effect that neither it nor any of the Restricted
Subsidiaries will trade any commodities. The Borrower maintains a supply
inventory position policy to the effect that neither it nor any of the
Restricted Subsidiaries will hold on hand, as of any date, more Commodities
Inventory than will be sold in the normal course of business during the
following 90 days. The Borrower and the Restricted Subsidiaries are in
compliance with such policies.
Section 3.30 Parity Debt. The obligations evidenced by this Agreement
and the Notes constitute Parity Debt (as defined in the Trust Agreement) and
this Agreement shall be considered a Parity Debt Agreement.
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ARTICLE IV
CONDITIONS OF LENDING
Section 4.01 Effectiveness. This Agreement shall become effective when
all of the conditions precedent set forth in this Section 4.01 shall have been
satisfied:
(a) Each Lender shall have received counterparts of this Agreement
signed by each of the parties hereto.
(b) Each Lender shall have received duly executed Notes, dated the
Closing Date, complying with the provisions of Section 2.04.
(c) Each Lender shall have received duly authorized, executed and
delivered counterparts of (i) the General Partner Guarantee Agreement, and
General Partner Consent Agreement dated the Closing Date and (ii) the Subsidiary
Guarantee Agreement, and Subsidiary Consent and Agreement dated the Closing
Date. The General Partner Guarantee Agreement and the Subsidiary Guarantee
Agreement are in full force and effect and constitute the legal, valid and
binding obligations of each of the parties thereto, and no default on the part
of any party thereto shall exist.
(d) The Trustee on behalf of the Secured Parties shall have a security
interest in the Collateral of the type and priority described in each Collateral
Document, perfected to the extent contemplated by Section 3.18 and each Lender
shall have received:
(i) duly authorized, executed and delivered counterparts of
(A) the Partners Security Agreement, duly executed by the General
Partner and the Public Partnership and any documents related thereto,
(B) the Borrower Security Agreement, duly executed by the Borrower, the
General Partner and the Restricted Subsidiaries, (C) the Public
Partnership Consent and Agreement dated the Closing Date, (D) the Cash
Collateral Agreement, duly executed by the Borrower, the Motor Vehicle
Security Agreements duly executed by the Borrower or the Restricted
Subsidiary, as the case may be, and (E) a duly completed and executed
Perfection Certificate from the Borrower dated the Closing Date. The
Partners Security Agreement, the Borrower Security Agreement, the Cash
Collateral Agreement and the Motor Vehicle Security Agreements are in
full force and effect and (i) constitute the valid and binding
obligation of each such party, (ii) constitute a valid assignment of,
and create a valid, presently effective security interest of record in
the property covered thereby and all interests described therein,
subject to no prior security interest in any such personal property
other than as specifically permitted therein for the benefit of the
Lenders under this Agreement, and no default on the part of any such
party shall exist thereunder;
(ii) acknowledgement copies of Uniform Commercial Code
financing statements which create in favor of the Trustee for the
benefit of the Secured Parties a valid, legal and perfected security
interest in or lien on the Collateral that is the subject of the
Security Agreements;
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(iii) certified copies of Requests for Information (form
UCC-11), or equivalent reports from ChoicePoint or other independent
search service satisfactory to the Lenders, listing (A) any judgment
naming any member of the Star Gas Group as judgment debtor, (B) any tax
lien that names any member of the Star Gas Group as a delinquent
taxpayer in any of the jurisdictions referred to in clause (iii) above
and (C) any Uniform Commercial Code financing statement that names any
member of the Star Gas Group as debtor or seller filed in any of the
jurisdictions referred to in clause (ii) above;
(iv) duly authorized, executed and delivered counterparts of
each Mortgage (including any amendments or supplements thereto) filed
by the Borrower, along with duly executed copies of all related
documents, including landlord waivers, subordination agreements and
estoppel certificates and legal opinions. The Mortgages are in full
force and effort and (a) constitute legal, valid and binding
obligations of the parties thereto, (b) constitute a valid first
mortgage lien of record on the real property and all other interests
described therein which may be subjected to a mortgage lien, subject
only to Permitted Exceptions for the benefit of the Lenders under this
Agreement, and (c) constitute a valid assignment of, and create a
valid, presently effective security interest of record in equipment and
all other interests (other than real property interests) described
therein for the benefit of the Lenders under this Agreement, subject to
no prior security interest in such property other than as specifically
permitted therein, and no default on the part of any party thereto
shall exist thereunder; and
(v) duly authorized, executed and delivered counterparts of
the Trust Agreement. The Trust Agreement is in full force and effect
and constitutes the legal, valid and binding obligation of each of the
parties thereto, and no default on the part of any party thereto shall
exist thereunder.
(e) The Trustee shall have received:
(i) a mortgagee's policy of title insurance, including
mechanic's lien coverage, with respect to the properties and facilities
so identified on Schedule 3.07, issued by a Title Company or Companies
authorized to issue title insurance in the states in which such
properties or facilities are located with satisfactory provisions for
coinsurance or reinsurance, insuring the interest of the Trustee under
the Collateral Documents as valid first liens on the Mortgaged
Properties, free of Liens (other than Liens permitted by Section 6.02)
or other exceptions to title not approved and accepted, such policies
to be in an amount at least equal to the amounts set forth opposite
each of the individual properties and facilities so identified on
Schedule 3.07;
(ii) satisfactory copies of "As-Built" ALTA surveys with
respect to the properties and facilities so identified on Schedule
3.07, certified to the Trustee and the Title Company or Companies;
(iii) satisfactory environmental reviews, audits and
appraisals of the properties of the Borrower and the Subsidiaries;
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(iv) the original stock certificates representing all
outstanding Capital Stock of the Subsidiaries, along with undated stock
powers endorsed in blank and duly executed Intercompany Notes;
(v) a certificate of the Borrower dated as of the Closing Date
duly executed by the Borrower addressed to the Trustee complying with
Section 6 of the Trust Agreement, which shall specify the date and
principal amount of the Notes, the name, address and tax payer
identification number of the Lenders and which shall state that this
Agreement is a Parity Debt Agreement, that this Agreement is entitled
to the benefits of the Trust Agreement and of the Security (as defined
in the Trust Agreement) and funds held under Section 4 of the Trust
Agreement and that this Agreement are subject to the terms of the Trust
Agreement; and
(vi) a duly executed Agreement of Parity Lenders and
Supplement to Intercreditor Agreement dated as of the Closing Date by
and between the Borrower and the Lenders in substantially the form
attached hereto as Exhibit J.
(f) The Lenders shall have received opinions of Xxxxxxxx Xxxxx Xxxxxxxx
Xxxx & Ballon LLP, counsel to the Borrower, substantially in the form of Exhibit
F-1 hereto and local counsel to the Borrower satisfactory to the Lenders for the
states of Minnesota and Ohio, substantially in the form of Exhibit F-2 hereto,
including, without limitation, an opinion from Xxxxxxxx Xxxxx Xxxxxxxx Xxxx &
Ballon LLP concerning the parity nature of the Parity Debt to be dated the
Closing Date and addressed to the Lenders and addressed to the Trustee.
(g) The Lenders shall have received:
(i) a certificate, dated the Closing Date and signed by a
Financial Officer of each of the Loan Parties, confirming compliance
with the conditions precedent set forth in paragraphs (j), (l), (p) and
(q) of this Section 4.01;
(ii) a copy of the partnership agreement, certificate of
incorporation or other constitutive documents, including all amendments
thereto, of each of the Loan Parties, certified as of a recent date by
the Secretary of State of the State of its organization, and a
certificate as to the good standing of each such party as of a recent
date, from such Secretary of State;
(iii) a certificate of the Secretary or Assistant Secretary of
each of the Loan Parties dated the Closing Date and certifying (A) that
attached thereto is a true and complete copy of the by-laws, operating
agreement or partnership agreement of such party, as applicable, as in
effect on the Closing Date and at all times since a date prior to the
date of the resolutions described in clause (B) below, (B) that
attached thereto is a true and complete copy of resolutions duly
adopted by the Board of Directors of such Loan Party (or, in the case
of the Borrower and the Public Partnership, of the General Partner)
authorizing the execution, delivery and performance of the Loan
Documents to which such Loan Party is or will be a party, and, in the
case of the Borrower, the extensions of credit hereunder, and that such
resolutions have not been modified,
62
rescinded or amended and are in full force and effect, (C) that the
certificate of incorporation, certificate of organization or other
constitutive documents of such Loan Party have not been amended since
the date of the last amendment thereto shown on the certificate of good
standing furnished pursuant to clause (ii) above and (D) as to the
incumbency and specimen signature of each officer executing any Loan
Document or any other document delivered in connection herewith on
behalf of such Loan Party;
(iv) a certificate of another officer as to the incumbency and
specimen signature of the Secretary or Assistant Secretary executing
the certificate pursuant to clause (iii) above;
(v) a true and complete copy of a duly, authorized, executed
and delivered Note Agreement, Existing Credit Agreement, amendment to
the Existing Credit Agreement satisfactory to the Lenders (the "Twelfth
Amendment"), Parity Debt Agreements and, as requested by the Lenders,
other Operative Agreements. The Existing Credit Agreement, the Twelfth
Amendment, the Note Agreement, the Parity Debt Agreements and all the
Operative Agreements have been duly authorized, executed and delivered
by the respective parties thereto, are in full force and effect and
constitute the legal, valid and binding obligations of the respective
parties thereto;
(vi) The conditions specified in Section 10.1(b) of the Note
Agreement, Section 6.01(b) of the Existing Credit Agreement and the
comparable provisions in the Parity Debt Agreements shall have been
fulfilled and the Lenders shall have received such evidence as they may
reasonably request (including copies of certificates and opinions
required by such provisions) demonstrating fulfillment of the
conditions, including, without limitation, (1) the opinion referred to
in Section 4.01(f) hereof, (2) a copy of the opinion of Xxxxxxxx Xxxxx
Xxxxxxxx Xxxx & Ballon LLP delivered to the Trustee to the effect that
the Lien of the Security Documents (as defined in the Trust Agreement)
has attached and is perfected to the extent additional property and
assets are being acquired on the Closing Date and (3) a copy of the
certificate of the Borrower to the Trustee, in form and substance
satisfactory to the Lenders in their sole discretion, (A) demonstrating
compliance with the definition of Parity Debt in the Trust Agreement
and (B) to the extent additional property and assets are being acquired
on the Closing Date, demonstrating that the principal amount of the
Indebtedness incurred hereunder does not exceed the lesser of the cost
to the Borrower of such property or assets and the fair market value of
such property or assets (as determined in good faith by the General
Partner); and
(vii) such other documents, opinions, certificates and
agreements in connection with the Facility and the Twelfth Amendment,
in form and substance satisfactory to the Lenders, as they or their
counsel shall reasonably request, including counterpart originals or
certified copies of all the other Operative Agreements.
(h) Each Lender shall have completed, and shall be satisfied in all
respects with the results of, its due diligence investigation of (i) the
business, assets, condition (financial and otherwise), liabilities (actual and
contingent) and prospects of the Borrower, (iii) litigation, tax,
63
accounting, labor, health and safety, environmental, insurance, pension and
other employee benefit matters and (iv) real estate leases, material contracts,
debt agreements, property ownership, and contingent liabilities of the Borrower
and the Subsidiaries.
(i) Each Lender shall be satisfied with (i) the amount, terms and
conditions (including maturity, amortization, interest rates and fees,
covenants, events of default, redemption and other provisions) of the Mortgage
Notes, the Existing Credit Agreement and the other Parity Debt Agreements and
(ii) the ownership structure of the Borrower, the Public Partnership and the
General Partner.
(j) There shall not have occurred or become known any material adverse
change or prospective material adverse change with respect to the business,
assets, operations, properties, condition (financial or otherwise), liabilities
(actual or contingent) or prospects of the Borrower from that shown in the
Information and Projections (each as defined in the Commitment Letter dated as
of February 12, 2002 among the General Partner, the Borrower, Fleet National
Bank and Bank of America, N.A.) reviewed by such Lender prior to the date
thereof. There shall not have occurred and be continuing since the date of the
Letter Agreement any materially adverse conditions in the market for bank credit
facilities similar in nature to the Facility or a material disruption of, or a
material adverse conditions in, financial, banking or capital market condition
generally.
(k) Each Lender, the Administrative Agent, the Issuing Bank and the
Documentation Agent shall have simultaneously executed and delivered this
Agreement.
(l) (i) The Borrower and the Restricted Subsidiaries shall have no
indebtedness or other liabilities to third parties (including affiliates),
whether accrued, absolute, contingent or threatened, and whether due or to
become due, except in respect of (A) the Facility, (B) the Mortgage Notes, (C)
the Notes (as defined in the Existing Credit Agreement), (D) the 1998 Parity
Notes, the 2000 Parity Notes, the 2001 Parity Notes and the Fleet Parity Note
(which Fleet Parity Note shall be paid in whole on the Closing Date), (E)
[Intentionally omitted], (F) accounts payable and other liabilities disclosed on
Schedule 3.05(d) or the unaudited pro forma balance sheet referred to in Section
3.05(c) and satisfactory in all respects to the Lenders and (G) liabilities
(other than indebtedness for borrowed money) incurred in the ordinary course of
business since December 31, 2001 (none of which other liabilities, individually
or in the aggregate, could have a Material Adverse Effect) and (ii) any liens on
or claims or encumbrances affecting any assets or properties of the Borrower and
the Subsidiaries or any other Collateral (including the Capital Stock of the
Borrower) shall have been released in a manner satisfactory to the Agents.
(m) The Lenders shall have received (i) financial statements and other
financial information satisfactory in all respects to the Lenders, including
historical, pro forma and projected information, (ii) a statement of the
Borrower dated as of the Closing Date to the effect that there is at least $6
million of net working capital, in each case certified by a Financial Officer of
the Borrower.
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(n) The Lenders shall have received such information as the Lenders may
request as to the aging and concentration of the accounts receivable of the
Borrower and the Subsidiaries and as to their inventory, and shall have
completed and be satisfied with their review thereof.
(o) Insurance shall be in full force and effect which complies with the
provisions of this Agreement and the Collateral Documents, and the Lender shall
have received a satisfactory report, on or prior to the Closing Date, from the
Borrower's independent insurance broker, Weeks & Xxxxxxxx, together with any
other evidence reasonably requested by the Agents, demonstrating that the
insurance required by Section 6.11 and by the terms of the other Loan Documents
is in effect. The Lenders shall be satisfied in all respects with all agreements
and transactions between any of the Borrower and the Subsidiaries, on the one
hand, and any of their Affiliates, on the other hand.
(p) All governmental, regulatory, shareholder and third party consents,
approvals, filings, registrations and other actions required in order to
consummate the transactions contemplated hereby, the Facility and the Twelfth
Amendment shall have been obtained or made, as applicable, and shall remain in
full force and effect, in each case without the imposition of any condition or
restriction which is, in the judgment of the Lenders, materially adverse to the
Borrower or any of the Subsidiaries. There shall not be any pending proceeding
requesting an injunction or restraining order with respect to the Facility or
the Twelfth Amendment or challenging the validity or enforceability of the
Facility or the Twelfth Amendment.
(q) The representations and warranties set forth in Article III hereof
and the representations and warranties of the Borrower and the other Loan
Parties set forth in the other Loan Documents shall be true and correct in all
material respects on and as of the Closing Date with the same effect as though
made on and as of the Closing Date, except to the extent such representations
and warranties expressly relate to an earlier date (in which case such
representations and warranties shall be true and correct in all material
respects on and as of such earlier date). No Default or Event of Default shall
have occurred and be continuing.
(r) The Borrower shall have paid all Fees and other amounts due and
payable to any Agent or Lender on or prior to the Closing Date, including
reimbursement or payment of all reasonable out-of-pocket expenses required to be
reimbursed or paid by the Borrower under the Letter Agreement, the Commitment
Letter dated as of February 12, 2002, among the General Partner, the Borrower,
Fleet National Bank and Bank of America, N.A. or under any Loan Document,
including, without limitation, all reasonable fees and expenses of legal counsel
to the Administrative Agent and the Lenders and all search and filing fees of
ChoicePoint or another company acceptable to the Lenders (to the extent invoices
or statements therefor have been received). The Borrower shall also have paid
all fees, expenses and other amounts due and payable in connection with the
Twelfth Amendment and assignments of commitments under the Existing Credit
Agreement made on the Closing Date.
(s) On the Closing Date, the commitments under the Fleet Parity Note
shall have been terminated, all loans outstanding thereunder shall have been
repaid in full, together with accrued interest thereon, all letters of credit
issued thereunder shall have been terminated or shall have become Letters of
Credit hereunder and all other amounts owing pursuant to the Fleet
65
Parity Note shall have been repaid in full, and the Administrative Agent shall
have received evidence in form, scope and substance satisfactory to it that the
matters set forth in this subsection have been satisfied at such time.
(t) The Administrative Agent shall have received a Notice of Borrowing
as required by Section 2.03 or a notice requesting the issuance of each Letter
of Credit as required by Section 2.21(c), as applicable, in either case such
notice shall specify a borrowing of at least $2,000,000.
Section 4.02 All Extensions of Credit. The obligations of the Lenders
to make Loans hereunder, and the obligation of the Issuing Bank to issue Letters
of Credit hereunder, are subject to the satisfaction of the conditions precedent
set forth in this Section 4.02 on the date of each Borrowing and on the date of
issuance of each Letter of Credit:
(a) The Administrative Agent shall have received a notice of such
Borrowing as required by Section 2.03 or a notice requesting the issuance of a
Letter of Credit as required by Section 2.21(c), as applicable.
(b) The representations and warranties set forth in Article III hereof
and the representations and warranties of the Borrower and the other Loan
Parties set forth in the other Loan Documents shall be true and correct in all
material respects on and as of the date of such Borrowing or the date of the
issuance of such Letter of Credit with the same effect as though made on and as
of such date, except to the extent such representations and warranties expressly
relate to an earlier date (in which case such representations and warranties
shall be true and correct in all material respects on and as of such earlier
date).
(c) At the time of and immediately after such Borrowing or the issuance
of such Letter of Credit, the aggregate outstanding principal amount of the
Loans of each Class and the Letter of Credit Exposure of each Class will not
exceed the limitations set forth in Sections 2.01 and 2.21, respectively.
(d) At the time of and immediately after such Borrowing or the issuance
of such Letter of Credit, no Default or Event of Default shall have occurred and
be continuing.
(e) At the time of and immediately after any Revolving Credit Borrowing
made or any Letter of Credit issued, the Leverage Ratio as of the date of such
Borrowing or issuance (after giving effect to the acquisition or Growth-Related
Capital Expenditure for which such Borrowing or Letter of Credit is being used)
shall be no greater than 4.50:1.00; and, in the case of each such Borrowing or
issuance of each such Letter of Credit, the Borrower shall have prepared and
furnished to the Agents prior to such Borrowing or issuance pro forma financial
statements demonstrating the fulfillment of such condition to the satisfaction
of the Agents. For purposes of calculating the Leverage Ratio as required by
this Section 4.02(e), Consolidated Cash Flow for the Reference Period shall mean
the greater of (A) Consolidated Cash Flow for the most recent period of four
consecutive fiscal quarters prior to the date of determination and (B) 50% of
Consolidated Cash Flow for the most recent period of eight consecutive fiscal
quarters prior to the date of determination.
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(f) If Capital Stock is being purchased with proceeds from such
Revolving Credit Borrowing, the Agents and the Trustee shall have received
counterparts of a Supplemental Agreement duly executed by the issuer of such
Capital Stock (and all terms of such Supplemental Agreement shall have been
satisfied).
(g) In the case of any Revolving Credit Borrowing and Tranche B
Revolving Credit Borrowing (as defined in the Existing Credit Agreement) (or
series of related Revolving Credit Borrowings and Tranche B Revolving Credit
Borrowings (as defined in the Existing Credit Agreement) not in the ordinary
course of business consistent with past practice) in a principal amount, and/or
any Letter of Credit and/or Tranche B Letter of Credit (as defined in the
Existing Credit Agreement) (or series of related Letters of Credit and/or
Tranche B Letters of Credit (as defined in the Existing Credit Agreement) not in
the ordinary course of business consistent with past practice) having a face
amount, in excess of $1,500,000 to be used for Growth-Related Capital
Expenditures, (i) the Agents shall be satisfied with all aspects of such
Growth-Related Capital Expenditures, including all legal, tax and accounting
matters relating such Growth-Related Capital Expenditures and the terms of all
agreements and instruments to be entered into in connection with such
Growth-Related Capital Expenditures, (ii) the Agents shall be satisfied with all
legal matters and documentation incident to such Growth-Related Capital
Expenditures and all corporate and other proceedings taken or to be taken in
connection therewith and (iii) the Agents shall have received (A) all financial
information reasonably requested by the Agents in connection with such
Growth-Related Capital Expenditures and (B) a statement of sources and uses of
funds in connection with such Growth-Related Capital Expenditures, in each case
certified by a Financial Officer of the Borrower.
(h) All components of such acquisition or Growth-Related Capital
Expenditure shall be consummated in accordance with applicable laws and
regulations.
(i) All governmental, regulatory, shareholder and third party consents,
approvals, filings, registrations and other actions required in order to
consummate such acquisition or Growth-Related Capital Expenditure (other than
any such actions the absence of which could not, individually or in the
aggregate, reasonably be expected to have a Material Adverse Effect) shall have
been obtained or made and shall remain in full force and effect, without the
imposition of any condition or restriction which is, materially adverse to the
Borrower or any of the Subsidiaries.
(j) There shall not be any pending proceeding requesting an injunction
or restraining order with respect to such acquisition or Growth-Related Capital
Expenditure or challenging the validity or enforceability of such acquisition or
Growth-Related Capital Expenditure.
(k) The Agents shall have received an Officers' Certificate, dated the
date of such Revolving Credit Borrowing or issuance of such Letter of Credit, to
the effect that the use of proceeds of such Borrowing or such Letter of Credit
complies with Section 3.13(b), specifying the basis for such conclusion in
reasonable detail.
(l) In the case of any issuance of a Letter of Credit, immediately
following the issuance of such Letter of Credit, the aggregate undrawn amount of
the sum of all outstanding
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Letters of Credit and all Tranche B Letters of Credit (as defined in the
Existing Credit Agreement) shall not exceed $12,500,000.
(m) The Borrowers shall have directly paid in full to ChoicePoint or
any other Company acceptable to the Lenders, all invoices of ChoicePoint or any
such Company for any Uniform Commercial Code Search (lien, tax or judgment) and
filings and no such invoices shall be unpaid.
Each Revolving Credit Borrowing hereunder and each request for the issuance of a
Letter of Credit hereunder shall be deemed to constitute a representation and
warranty by the Borrower on the date of such Borrowing or issuance as to the
matters specified in paragraphs (b), (c), (d), (e), (h), (i), (j) and (l) of
this Section 4.02. For purposes of this Section 4.02, the "issuance" of a Letter
of Credit shall include any extension, renewal or amendment of a Letter of
Credit.
ARTICLE V
ACCOUNTING; FINANCIAL STATEMENTS; INSPECTION
The Borrower covenants and agrees with each Lender that so long as this
Agreement shall remain in effect or any Facilities Obligations shall be unpaid,
and until the Commitments have been terminated and the Loans, together with
interest, Fees and all other Facilities Obligations have been paid in full, all
Letters of Credit have been cancelled or have expired and all Letter of Credit
Disbursements have been reimbursed in full, unless the Required Lenders shall
otherwise consent in writing:
Section 5.01 Accounting. The Borrower will maintain, and will cause
each Restricted Subsidiary to maintain, a system of accounting established and
administered in accordance with GAAP, and will accrue, and will cause each
Restricted Subsidiary to accrue, all such liabilities as shall be required by
GAAP.
Section 5.02 Financial Statements. The Borrower will deliver to the
Lenders:
(a) as soon as practicable, but in any event within 45 days after the
end of each of the first three quarterly fiscal periods in each fiscal year of
the Borrower, consolidated (and (A) if the Restricted Subsidiaries constitute a
Substantial Portion (as defined below), then as to the Restricted Subsidiaries
or (B) if the Restricted Subsidiaries do not constitute a Substantial Portion,
but one or more Restricted Subsidiaries have outstanding Indebtedness owing to
Persons other than the Borrower or any Restricted Subsidiary, other than the
Star/Petro Intercompany Subordinated Debt, then as to such Restricted
Subsidiaries, consolidating) balance sheets of the Borrower and the Restricted
Subsidiaries as at the end of such period and the related consolidated (and, as
to statements of income and cash flows, if applicable and as appropriate,
consolidating) statements of income, surplus or partners' capital, cash flows
and stockholders' equity of the Borrower and the Restricted Subsidiaries for
such period and for the period from the beginning of the current fiscal year to
the end of such quarterly period, setting forth in each case in comparative form
the consolidated and, where applicable and as appropriate, consolidating figures
for the corresponding periods of the previous fiscal year, all in reasonable
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detail and certified by the principal financial officer of the General Partner
as presenting fairly, in all material respects, the information contained
therein (subject to changes resulting from normal year-end adjustments), in
accordance with GAAP (except as noted in the proviso that follows) applied on a
basis consistent with prior fiscal periods; provided that, it is understood that
the financial statements provided in accordance with this Section 5.02(a) shall
be adjusted to show Petro Holdings as consolidated with the Borrower; provided
that delivery within the time period specified above of copies of the Public
Partnership's Quarterly Report on Form 10-Q prepared in compliance with the
requirements therefor and filed with the SEC shall be deemed to satisfy the
requirements hereof, but only to the extent such reports otherwise satisfy the
requirements of this Section 5.02(a), so long as the Public Partnership does not
conduct any material business or activity other than holding Capital Stock of
the Borrower; and provided further that, for purposes of this Section 5.02,
"Substantial Portion" shall mean that either (X) the book value of the assets of
the Restricted Subsidiaries exceeds 5% of the book value of the consolidated
assets of the Borrower and the Restricted Subsidiaries or (Y) the Restricted
Subsidiaries account for more than 5% of the Consolidated Net Income of the
Borrower and its Restricted Subsidiaries (it being agreed that the net income of
Unrestricted Subsidiaries shall not be consolidated with the Borrower and the
Restricted Subsidiaries for purposes of this calculation of Consolidated Net
Income), in each case in respect of the four fiscal quarters ended as of the
date of the applicable financial statement; provided that, with respect to
Star/Petro, (i) the book value of the common stock of Petro Holdings shall be
excluded from the determination of Substantial Portion in clause (X) above and
(ii) the income of Petro Holdings shall be excluded from the determination of
Substantial Portion in clause (Y) above;
(b) as soon as practicable, but in any event within 90 days after the
end of each fiscal year of the Borrower ending after the date of this Agreement,
consolidated (and (A) if the Restricted Subsidiaries constitute a Substantial
Portion, then as to the Restricted Subsidiaries or (B) if the Restricted
Subsidiaries do not constitute a Substantial Portion, but one or more Restricted
Subsidiaries have outstanding Indebtedness owing to Persons other than the
Borrower or any Restricted Subsidiary other than the Star/Petro Intercompany
Subordinated Debt, then as to such Restricted Subsidiaries, consolidating)
balance sheets of the Borrower and the Restricted Subsidiaries and the
consolidated balance sheet of the General Partner as at the end of such year and
the related consolidated (and, as to statements of income and cash flows, if
applicable and as appropriate, consolidating) statements of income, partners'
capital, cash flows and stockholders' equity of the Borrower and the Restricted
Subsidiaries and the consolidated statements of income, surplus, cash flow and
stockholders' equity of the General Partner for such fiscal year, setting forth
in each case in comparative form the consolidated and, where applicable and as
appropriate, consolidating figures for the previous fiscal year, all in
reasonable detail; provided that, it is understood that the financial statements
provided in accordance with this Section 5.02(b) shall be adjusted to show Petro
Holdings as consolidated with the Borrower, provided that delivery within the
time periods specified above of copies of the Public Partnership's Annual Report
on Form 10-K prepared in compliance with the requirements therefor and filed
with the SEC shall be deemed to satisfy the requirements hereof, but only to the
extent such reports (X) otherwise satisfy the requirements of this Section
5.02(b) so long as the Public Partnership does not conduct any material business
or activity other than holding Capital Stock of the Borrower, (Y) are
accompanied by a report thereon of KPMG LLP or other independent public
accountants of recognized national standing selected by the Borrower and
acceptable to the Required
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Lenders, which report shall state that such consolidated financial statements
present fairly the financial position of the Borrower and its Restricted
Subsidiaries as at the dates indicated and the results of their operations and
cash flows for the periods indicated in conformity with GAAP applied on a basis
consistent with prior years and that the audit by such accountants in connection
with such consolidated financial statements has been made in accordance with
GAAP and (Z) in the case of such consolidated financial statements of the
General Partner and such consolidating financial statements of the Borrower
certified by the principal financial officer of the General Partner, as
presenting fairly the information contained therein, in accordance with GAAP
applied on a basis consistent with prior fiscal periods;
(c) together with each delivery of financial statements pursuant to
paragraphs (a) and (b) of this Section 5.02 (or, in the case of clause (vi)
below only, within 15 days thereafter), an Officers' Certificate of the Borrower
in the form of Exhibit K hereto (i) stating that the signers have reviewed the
terms of this Agreement and the other Loan Documents, and have made, or caused
to be made under their supervision, a review in reasonable detail of the
transactions and condition of the Borrower and the Restricted Subsidiaries
during the accounting period covered by such financial statements and that the
signers do not have knowledge of the existence and continuance as at the date of
such Officers' Certificate of any condition or event which constitutes an Event
of Default or Default or, if any such condition or event exists, specifying the
nature and period of existence thereof and what action the Borrower has taken or
is taking or proposes to take with respect thereto, (ii) stating whether, since
the date of the most recent financial statements previously delivered, there has
been any material change in GAAP applied in the preparation of the Borrower's
financial statements and, if so, describing such change, (iii) specifying the
amount available at the end of such accounting period for Restricted Payments in
compliance with Section 6.04 and showing in reasonable detail all calculations
required in arriving at such amount, (iv) demonstrating in reasonable detail, if
applicable, compliance during and at the end of such accounting period with the
restrictions contained in Sections 6.01(b), (d), (f) and (h), the last paragraph
of Section 6.01, 6.02(i), 6.03(iv) and 6.07(c)(iii), (v) if not specified in the
related financial statements being delivered pursuant to paragraphs (a) and (b)
above, specifying the aggregate amount of interest paid or accrued by the
Borrower and the Restricted Subsidiaries, and the aggregate amount of
depreciation, depletion and amortization charged on the books of the Borrower
and the Restricted Subsidiaries, during the fiscal period covered by such
financial statements and (vi) describing in reasonable detail the number and
nature of the parcels of real property, or rights thereto or interests therein,
caused to be released by the Borrower from the liens of the Security Documents
pursuant to the Trust Agreement and in the case of the fee owned property, the
sales price of the fee owned property caused to be released by the Borrower
during such accounting period;
(d) together with each delivery of consolidated financial statements
pursuant to paragraph (b) of this Section 5.02, a written statement by the
independent public accountants giving the report thereon (i) stating that in
connection with their audit examination, the terms of this Agreement and the
other Loan Agreements were reviewed to the extent considered necessary for the
purpose of expression of an opinion on the consolidated financial statements and
for making the statement contained in clause (ii) of this paragraph (d) (it
being understood that no special audit procedures in addition to those required
by generally accepted auditing standards then in effect in the United States
shall be required) and (ii) stating whether, in the
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course of their audit examination, they obtained knowledge (and whether, as of
the date of such written statement, they have knowledge) of the existence and
continuance of any condition or event which constitutes an Event of Default or
Default, and, if so, specifying the nature and period of existence thereof;
(e) promptly upon receipt thereof, copies of all reports submitted to
the Borrower by independent public accountants in connection with each special
audit or each annual or interim audit of the books of the Borrower or any
Restricted Subsidiary made by such accountants, including the comment letter
submitted by the accountants to management in connection with their annual
audit;
(f) promptly upon their becoming publicly available, copies of all
financial statements, reports, notices and proxy statements sent or made
available by the Borrower, the General Partner or the Public Partnership to all
of its security holders in compliance with the Exchange Act or any comparable
Federal or state laws relating to the disclosure by any Person of information to
its security holders, of all regular and periodic reports and all registration
statements and prospectuses filed by the Borrower, the General Partner or the
Public Partnership with any securities exchange or with the SEC (other than
Registration Statements on Form S-8), and of all press releases and other
statements made available by the Borrower, the General Partner or the Public
Partnership to the public concerning material developments in the business of
the Borrower, the General Partner or the Public Partnership, as the case may be;
(g) promptly, but in any event within five days, after any Responsible
Officer knows or should (in the course of the normal performance of his or her
duties) know that (i) any condition or event which constitutes an Event of
Default or Default has occurred or exists, or is expected to occur or exist,
(ii) any Lender has given any notice or taken any other action with respect to a
claimed Event of Default or Default or (iii) any Person has given any notice to
the Borrower or any Restricted Subsidiary or taken any other action with respect
to a claimed default or event or condition of the type referred to in Section
7.01(f), an Officers' Certificate of the Borrower describing the same and the
period of existence thereof and what action the Borrower has taken, is taking
and proposes to take with respect thereto;
(h) promptly, but in any event within five days, after any Responsible
Officer knows or should (in the course of the normal performance of his or her
duties) know of (i) the commencement of or significant development in any
material litigation or material proceeding (including those regarding
environmental matters) with respect to the Borrower or affecting the Borrower,
any Restricted Subsidiary or any of their assets, a written notice describing in
reasonable detail such commencement of or significant development in such
litigation or proceeding or (ii) any development that has resulted in, or could
reasonably be expected to result in, a Material Adverse Effect, a written notice
describing in reasonable detail such development;
(i) promptly, but in any event within five days after any Responsible
Officer knows or should (in the course of the normal performance of his or her
duties) know that any of the events or conditions specified below with respect
to any Plan has occurred or exists, or is expected to occur or exist, a
statement setting forth details respecting such event or condition and the
action, if any, that the Borrower or any Related Person has taken, is taking and
proposes to
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take or cause to be taken with respect thereto (and a copy of any notice or
report filed with or given to or communication received from the PBGC, the IRS
or the Department of Labor with respect to such event or condition):
(i) any reportable event, as defined in Section 4043(b) of
ERISA and the regulations issued thereunder;
(ii) the filing under Section 4041 of ERISA of a notice of
intent to terminate any Plan or the termination of any Plan;
(iii) a substantial cessation of operations within the meaning
of Section 4062(e) of ERISA under circumstances which could result in
the treatment of the Borrower or any Related Person as a substantial
employer under a "multiple employer plan" or the application of the
provisions of Section 4062, 4063 or 4064 of ERISA to the Borrower or
any Related Person;
(iv) the taking of any steps by the PBGC or the institution by
the PBGC of proceedings under Section 4042 of ERISA for the termination
of, or the appointment of a trustee to administer, any Plan, or the
receipt by the Borrower or any Related Person of a notice from a
Multiemployer Plan that such action has been taken by the PBGC with
respect to such Multiemployer Plan;
(v) the complete or partial withdrawal by the Borrower or any
Related Person under Section 4063, 4203 or 4205 of ERISA from a Plan
which is a "multiple employer plan" or a Multiemployer Plan, or the
receipt by the Borrower or any Related Person of notice from a
Multiemployer Plan regarding any alleged withdrawal or that it intends
to impose withdrawal liability on the Borrower or any Related Person or
that it is in reorganization or is insolvent within the meaning of
Section 4241 or 4245 of ERISA or that it intends to terminate under
Section 404lA of ERISA or from a "multiple employer plan" that it
intends to terminate;
(vi) the taking of any steps concerning the threat or the
institution of a proceeding against the Borrower or any Related Person
to enforce Section 515 of ERISA;
(vii) the occurrence or existence of any event or series of
events which could result in a liability to the Borrower or any Related
Person pursuant to Section 4069(a) or 4212(c) of ERISA;
(viii) the failure to make a contribution to any Plan, which
failure, either alone or when taken together with any other such
failure, is sufficient to result in the imposition of a lien on any
property of the Borrower or any Related Person pursuant to Section
302(0 of ERISA or Section 412(n) of the Code or could result in the
imposition of a material tax or material penalty pursuant to Section
4971 of the Code on the Borrower or any Related Person;
(ix) the amendment of any Plan in a manner which would be
treated as a termination of such Plan under Section 4041(e) of ERISA or
require the Borrower or
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any Related Person to provide security to such Plan pursuant to Section
307 of ERISA or Section 401(a)(29) of the Code; or
(x) the incurrence of liability in connection with the
occurrence of a "prohibited transaction" (within the meaning of Section
406 of ERISA or Section 4975 of the Code);
(j) promptly, but in any event within five days, after an officer of
any of the Borrower, any Subsidiary or the General Partner receives any notice
or request from any Person (other than any agent, attorney or similar party
employed by the Borrower or the General Partner) for information, or if the
Borrower, any Subsidiary or the General Partner by an officer provides any
notice or information to any such Person (other than any agent, attorney or
similar party employed by the Borrower or the General Partner), concerning the
presence or release of any hazardous substance (as defined in CERCLA) or
hazardous waste (as defined in RCRA) or other contaminants (as defined by any
applicable Federal, state, local or foreign laws) within, on, from, relating to
or affecting any property owned, leased, or subleased by the Borrower or any
Subsidiary, copies of each such notice, request or information;
(k) [Intentionally Omitted];
(l) as soon as available, and in any event no later than 30 days after
the end of each fiscal year of the Borrower, quarterly financial projections for
the next fiscal year, including all material assumptions to such projections;
(m) within 15 days of receipt, any management letter issued or provided
by the auditors of the Borrower or any Restricted Subsidiary; and
(n) promptly, from time to time, such other information regarding the
operations, business affairs and financial condition of the Borrower, any other
Loan Party or (to the extent such information relates to environmental matters
or any material litigation or proceeding) any Unrestricted Subsidiary, or in any
event compliance with the terms of any Loan Document, as any Lender may
reasonably request.
Section 5.03 Inspection. The Borrower will permit, or cause the General
Partner to permit, any authorized representatives designated by the Lenders to
visit and inspect any of the properties of the Borrower, any Restricted
Subsidiary and (to the extent relating to environmental or litigation matters)
any Unrestricted Subsidiary, and in any event any properties of the General
Partner or of the General Partner's subsidiaries relating to the Business,
including the books of account of the Borrower, the Restricted Subsidiaries,
such Unrestricted Subsidiaries, the General Partner and the General Partner's
subsidiaries, and to make copies and take extracts therefrom, and to discuss its
and their affairs, finances and accounts with its and their officers and (with
reasonable notice) independent public accountants (and by this provision each of
the Borrower and the General Partner authorizes such accountants to discuss with
such representatives the affairs, finances and accounts of the Borrower, any
Restricted Subsidiary, such Unrestricted Subsidiaries, the General Partner or
any of such subsidiaries of the General Partner, as the case may be, all at such
times and as often as may be requested), provided that the Borrower will bear
73
the expense for the foregoing if an Event of Default or Default has occurred and
is continuing. Without limitation of the foregoing, the Agents shall have the
right to conduct an audit of the accounts receivable and inventory of the
Borrower and its Restricted Subsidiaries from time to time. The Borrower shall
pay the expenses of the Agents for up to two such audits in any 12-month period
and for any additional audit conducted during the continuance of an Event of
Default.
ARTICLE VI
BUSINESS AND FINANCIAL COVENANTS
The Borrower covenants and agrees with each Lender that so long as this
Agreement shall remain in effect or any Facilities Obligations shall be unpaid,
and until the Commitments have been terminated and the Loans, together with
interest, Fees and all other Facilities Obligations have been paid in full, all
Letters of Credit have been cancelled or have expired and all Letter of Credit
Disbursements have been reimbursed in full, unless the Required Lenders shall
otherwise consent in writing:
Section 6.01 Indebtedness. The Borrower will not, and will not permit
any Restricted Subsidiary to, directly or indirectly, create, incur, assume,
guarantee or otherwise become or remain directly or indirectly liable with
respect to (collectively, "Incur"), any Indebtedness, except that:
(a) the Borrower may become and remain liable with respect to the
Indebtedness evidenced by the Mortgage Notes, the Notes (as defined by the
Existing Credit Agreement), the 1998 Parity Notes, the 2000 Parity Notes and the
2001 Parity Notes;
(b) the Borrower and the Restricted Subsidiaries may become and remain
liable with respect to Funded Debt incurred by the Borrower and the Restricted
Subsidiaries to finance the making of expenditures for the improvement or repair
of or additions to the Assets, or to renew, refund, refinance or replace any
such Funded Debt; provided that (i) the aggregate principal amount of Funded
Debt incurred under this Section 6.01(b) and outstanding at any time shall not
exceed an amount equal to the net cash proceeds received by the Borrower from
the General Partner or from the Public Partnership as a capital contribution, in
each case for the sole purpose of financing such expenditures, (ii) if such
Funded Debt is to be secured under the Collateral Documents as provided in
Section 6.02(h), the agreement or instrument pursuant to which such Funded Debt
is incurred (A) contains no financial or business covenants that are more
restrictive on the Borrower or its Subsidiaries than or that are in addition to
those contained in Section 10 of the Note Agreement (unless prior to or
simultaneously with the incurrence of such Funded Debt, this Agreement and the
other Loan Documents are amended to provide the benefits of such more
restrictive covenants to the Secured Parties thereunder) and (B) specifies no
events of default (other than with respect to the payment of principal and
interest on such Funded Debt or the accuracy of representations and warranties
made in connection with such agreement or instrument) which are capable of
occurring prior to the occurrence of the Events of Default specified in Article
VII hereof (unless prior to or simultaneously with the incurrence of such
74
Funded Debt, this Agreement and the other Loan Documents are amended to provide
the benefits of such more restrictive covenants to the Secured Parties
thereunder);
(c) any Restricted Subsidiary may become and remain liable with respect
to unsecured Indebtedness of such Restricted Subsidiary owing to the Borrower or
to another Restricted Subsidiary; provided that such Indebtedness is created and
is outstanding under an agreement or instrument pursuant to which such
Indebtedness is subordinated to the Notes and the Indebtedness secured under the
Collateral Documents and is evidenced by an Intercompany Note pledged to the
Trustee pursuant to the Borrower Security Agreement;
(d) the Borrower and the Restricted Subsidiaries may become and remain
liable with respect to unsecured Indebtedness (including, without limitation, in
the case of Indebtedness of Star/Petro, the Star/Petro Intercompany Subordinated
Debt) owing to the General Partner or the Public Partnership; provided that (i)
the aggregate principal amount of such Indebtedness of the Borrower and the
Restricted Subsidiaries outstanding at any time shall not be in excess of
$10,000,000 (plus the Star/Petro Intercompany Subordinated Debt), (ii) such
Indebtedness is created and is outstanding under an agreement or instrument, or
the Star/Petro Intercompany Subordinated Note, as the case may be, pursuant to
which such Indebtedness is subordinated to the Indebtedness secured under the
Collateral Documents at least to the extent provided in the subordination
provisions set forth in Exhibit D and (iii) such Indebtedness is evidenced by a
promissory note, or the Star/Petro Intercompany Subordinated Note, as the case
may be, in form and substance satisfactory to the Required Lenders which is
pledged to the Trustee pursuant to the Partners Security Agreement;
(e) [Intentionally Omitted];
(f) the Borrower and the Restricted Subsidiaries may become and remain
liable with respect to Indebtedness, in addition to that otherwise permitted by
the foregoing paragraphs of this Section 6.01, if on the date the Borrower
becomes liable with respect to any such additional Indebtedness and immediately
after giving effect thereto and to the substantially concurrent repayment of any
other Indebtedness (i) the ratio of Consolidated Cash Flow to Consolidated Pro
Forma Debt Service is greater than 2.50 to 1.00 and (ii) the ratio of
Consolidated Cash Flow to Maximum Consolidated Pro Forma Debt Service is greater
than 1.25 to 1.00; provided that, in addition to the foregoing, if such
Indebtedness is Funded Debt incurred by the Borrower or any Restricted
Subsidiary to finance the making of expenditures for the improvement or repair
of or additions to the Assets, and if such Indebtedness is to be secured under
the Collateral Documents as provided in Section 6.02(h), such Indebtedness shall
be incurred pursuant to an agreement or instrument which complies with the
requirements set forth in clause (ii) of the proviso to Section 6.01(b);
(g) [Intentionally Deleted];
(h) the Borrower and any Restricted Subsidiary may become and remain
liable with respect to pre-existing Indebtedness relating to any Person,
business or assets acquired by the Borrower or such Restricted Subsidiary, as
the case may be; provided that (i) no condition or event shall exist which
constitutes an Event of Default or Default, (ii) such Indebtedness was not
75
incurred in anticipation of the acquisition of such Person, business or assets,
(iii) after giving effect to such Person becoming a Restricted Subsidiary, or
the acquisition of such business or assets, the Borrower or such Restricted
Subsidiary could incur at least $1 of additional Indebtedness in compliance with
the requirements set forth in clauses (i) and (ii) of Section 6.01(f) and (iv)
the acquisition of such Person, business or assets is permitted by all other
applicable provisions of the Loan Documents, including Sections 6.03 and 6.24;
(i) so long as no Event of Default or Default has occurred and is
continuing, the Borrower and the Restricted Subsidiaries may become and remain
liable with respect to Funded Debt incurred for any extension, renewal,
refunding or replacement of the Mortgage Notes and the Tranche B Notes (as
defined in the Existing Credit Agreement) in an aggregate principal amount not
in excess of $25 million outstanding; provided that (i) the aggregate principal
amount of such Funded Debt shall not exceed the principal amount of such
Indebtedness being extended, renewed, refinanced, refunded, or replaced together
with any accrued interest and Make Whole Amount with respect thereto, (ii) such
Funded Debt could be incurred in compliance with the requirements set forth in
clauses (i) of Section 6.01(f), and (iii) if such Funded Debt is to be secured
under the Collateral Documents as provided in Section 6.02(h), such Funded Debt
is incurred pursuant to an agreement or instrument which complies with the
requirements set forth in clause (ii) of the provision to Section 6.01(b), (iv)
such Funded Debt shall not mature prior to the stated maturity of the
Indebtedness being extended, renewed, refinanced, refunded or replaced and (v)
such Funded Debt shall be secured on a pari passu basis with Indebtedness
secured by the Collateral Documents;
(j) so long as no Event of Default or Default has occurred and is
continuing, the Borrower and the Restricted Subsidiaries may become and remain
liable with respect to unsecured Indebtedness incurred for any extension,
renewal, refinancing, refunding or replacement of Indebtedness permitted
pursuant to subdivisions (a), (b), (f) or (h) of this Section 6.01; provided
that (i) the principal amount of such unsecured Indebtedness to be incurred
shall not exceed the principal amount of such Indebtedness being extended,
renewed, refinanced, refunded or replaced together with any accrued interest
and, in the case of the Mortgage Notes, Make Whole Amount with respect thereto
and (ii) such unsecured Indebtedness to be incurred shall not mature prior to
the stated maturity of such Indebtedness being extended, renewed, refinanced,
refunded or replaced;
(k) the Borrower may create and become liable with respect to any
Hedging Agreements and Commodity Hedging Agreements;
(l) any Restricted Subsidiary may become and remain liable with respect
to Indebtedness evidenced by the Collateral Documents;
(m) [Intentionally Omitted]; and
(n) the Borrower may become and remain liable with respect to unsecured
Indebtedness owing to a Seller in connection with the acquisition of an Acquired
Business Entity from such Seller, provided that (i) the aggregate principal
amount of such Indebtedness of the Borrower at any time shall not exceed
$5,000,000, and (ii) the aggregate Consolidated Cash
76
Flow generated by such Acquired Business Entity for so long as such Indebtedness
is outstanding shall exceed the aggregate amount of all principal and interest
that will become due and payable on such Indebtedness until such Indebtedness is
repaid in full.
Notwithstanding the foregoing, the aggregate principal amount of all
Indebtedness of all Restricted Subsidiaries at any time outstanding (other than
Indebtedness secured by the Collateral Documents) shall not exceed $10 million
(plus the Star/Petro Intercompany Subordinated Debt). For the purpose of this
Section 6.01, any Person becoming a Restricted Subsidiary after the date of this
Agreement shall be deemed to have become liable with respect to all of its then
outstanding Indebtedness at the time it becomes a Restricted Subsidiary, and any
Person extending, renewing or refunding any Indebtedness shall be deemed to have
become liable with respect to such Indebtedness at the time of such extension,
renewal or refunding. The Borrower or any Restricted Subsidiary shall be deemed
to have become liable with respect to any Indebtedness securing any real
property acquired by the Borrower or such Restricted Subsidiary, as the case may
be, at the time of such acquisition.
Section 6.02 Liens, etc. The Borrower will not, and will not permit any
Restricted Subsidiary to, directly or indirectly create, incur, assume or permit
to exist any Lien on or with respect to any property or asset (including any
document or instrument in respect of goods or accounts receivable) of the
Borrower or any Restricted Subsidiary, whether now owned or held or hereafter
acquired, or any income or profits therefrom (whether or not provision is made
for the equal and ratable securing of the Facility Obligations in accordance
with the provisions of Section 6.15), except:
(a) Liens for taxes, assessments or other governmental charges the
payment of which is not at the time required by Section 6.09;
(b) Liens of landlords and carriers, vendors, warehousemen, mechanics,
materialmen, repairmen and other like Liens incurred in the ordinary course of
business for sums not yet due or the payment of which is not at the time
required by Section 6.09, in each case not incurred or made in connection with
the borrowing of money, the obtaining of advances or credit or the payment of
the deferred purchase price of property;
(c) Liens (other than any Lien imposed by ERISA) incurred or deposits
made in the ordinary course of business (i) in connection with workers'
compensation, unemployment insurance and other types of social security or (ii)
to secure (or to obtain letters of credit that secure) the performance of
tenders, statutory obligations, surety and appeal bonds, bids, leases,
performance bonds, purchase, construction or sales contracts and other similar
obligations, in each case not incurred or made in connection with the borrowing
of money, the obtaining of advances or credit or the payment of the deferred
purchase price of property ;
(d) any attachment or judgment Lien, unless the judgment it secures
shall not, within 60 days after the entry thereof, have been discharged or
execution thereof stayed pending appeal, or shall not have been discharged
within 60 days after expiration of any such stay;
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(e) leases or subleases granted to others, easements, rights-of-way,
restrictions and other similar charges or encumbrances, which, in each case are
granted, entered into or created in the ordinary course of the business of the
Borrower or any Restricted Subsidiary and which do not interfere with the
ordinary conduct of the business of the Borrower or any Restricted Subsidiary;
(f) Liens on property or assets of any Restricted Subsidiary securing
Indebtedness of such Restricted Subsidiary owing to the Borrower or any other
Restricted Subsidiary;
(g) Liens created by any of the Collateral Documents;
(h) Liens created by any of the Collateral Documents securing
Indebtedness incurred in accordance with Section 6.01(b), 6.01(i) or 6.01(k)
(but only to the extent such Indebtedness under Section 6.01(k) is incurred to
any Lender) or, to the extent incurred to finance the making of capital
improvements, repairs and additions to the Borrower's Assets, Section 6.01(f)
(but only to the extent such Liens comply with the requirements thereof),
provided that (i) such Liens are effected through an amendment to the Collateral
Documents to the extent necessary to provide the holders of such Indebtedness
equal and ratable security in the property and assets subject to the Collateral
Documents with the Secured Parties, (ii) the Collateral Documents are amended to
the extent necessary to extend the Lien thereof to any property or assets
acquired or otherwise financed with the proceeds of such Indebtedness, (iii) the
Borrower has delivered to the Trustee an Officers' Certificate demonstrating
that the principal amount of such Indebtedness does not exceed the lesser of the
cost to the Borrower of such property or assets and the fair market value of
such property or assets (as determined in good faith by the General Partner) and
to the effect that the amendments to the Collateral Documents required by this
Section 6.02(h) and the filing and recordation of such amendments and related
supplements will not have a Material Adverse Effect and that such incurrence of
Indebtedness pursuant to Section 6.01(b), 6.01(i), 6.01(k) or 6.01(f), as the
case may be, complies in all respects with the requirements of such Section and
(iv) the Borrower has delivered to the Trustee an opinion of counsel reasonably
satisfactory to the Trustee to the effect that the Lien of the Collateral
Documents has attached and is perfected with respect to such additional property
and assets;
(i) Liens existing on any property of a newly-acquired Restricted
Subsidiary at the time of acquisition or existing prior to the time of
acquisition (and not created in anticipation of such acquisition) upon any
property acquired by the Borrower or any Restricted Subsidiary; provided that
(i) any such Lien shall be confined solely to the item or items of property so
acquired and, if required by the terms of the instrument originally creating
such Lien, other property which is an improvement to or is acquired for specific
use in connection with such acquired property, (ii) the Indebtedness secured by
any such Lien is permitted under Section 6.01(f) or (h) and, in the case of any
such Indebtedness incurred under Section 6.01(f), the total principal amount
thereof is no greater than the excess, if any, of such amount over the aggregate
amount of the unused Revolving Credit Commitments on the date of incurrence
thereof, (iii) the principal amount of the Indebtedness secured by any such Lien
shall at no time exceed an amount equal to the lesser of (A) the cost of such
property to the Borrower or such Restricted Subsidiary, as the case may be, and
(B) the fair market value of such property (as determined in good faith by the
General Partner) at the time of such acquisition by the Borrower or such
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Restricted Subsidiary, (iv) the aggregate principal amount of all Indebtedness
secured by any such Liens shall at no time exceed $5,000,000 and (v) any such
Lien shall not have been created or assumed in contemplation of such acquisition
of a Restricted Subsidiary or property by the Borrower or any Restricted
Subsidiary;
(j) Liens in amounts not exceeding $100,000 incurred, required or
provided for under state law in connection with self-insurance arrangements;
(k) Liens arising from or constituting encumbrances or exceptions to
title to the Assets expressly permitted by the Collateral Documents; and
(l) any Lien renewing, extending or refunding any Lien permitted by the
foregoing paragraphs of this Section 6.02; provided that (i) the Indebtedness
secured by any such Lien shall not exceed the amount of such Indebtedness
outstanding immediately prior to the renewal, extension or refunding of such
Lien, (ii) no Assets encumbered by any such Lien other than the Assets
encumbered immediately prior to such renewal, extension or refunding shall be
encumbered thereby, (iii) the Indebtedness secured by any such Lien shall not
mature prior to the stated maturity of such Indebtedness outstanding immediately
prior to the renewal, extension or refunding of such Lien and (iv) the
Indebtedness secured by any such Lien shall have an Average Life equal to or
greater than the remaining Average Life of such Indebtedness outstanding
immediately prior to the renewal, extension or refunding of such Lien.
Section 6.03 Investments, Guaranties, etc. The Borrower will not, and
will not permit any Restricted Subsidiary to, directly or indirectly (a) make or
own any Investment in any Person or (b) create or become liable with respect to
any Guaranty, except:
(i) the Borrower or any Restricted Subsidiary may make and own
Investments in Cash Equivalents;
(ii) the Borrower and any Restricted Subsidiary may make and
own Investments in any Restricted Subsidiary or Investments in Capital
Stock of any Person which simultaneously therewith becomes a Restricted
Subsidiary;
(iii) any Restricted Subsidiary may make and permit to be
outstanding Investments in the Borrower and may create or become liable
with respect to any Guarantee in respect of the Facility Obligations,
the Mortgage Notes, the Existing Credit Agreement, the 1998 Parity
Notes, the 2000 Parity Notes, the 2001 Parity Notes and any other
Parity Debt;
(iv) (A) the Borrower or any Restricted Subsidiary may make
and own Investments in the Capital Stock of, or contributions to
capital in the ordinary course of business of, any Unrestricted
Subsidiary, except Petro Holdings and its Subsidiaries, if immediately
after giving effect to the making of any such Investment the aggregate
amount of all such Investments made and outstanding pursuant to this
paragraph (iv) shall not at any time exceed $15,000,000 and (ii) the
aggregate amount of all investments made and outstanding pursuant to
this clause (iv) as of the end of any fiscal quarter of the
79
Borrower shall not exceed by more than $5,000,000 the amount of such
investments as of the immediately preceding fiscal quarter of the
Borrower, in the cases of both subclauses (i) and (ii) of this clause,
disregarding any such investment which on the date of determination
could be made pursuant to clause (ii) of this Section 6.03 and net of
cash distributions received from all Unrestricted Subsidiaries for such
period excluding Petro Holdings, since the date hereof, and (B)
Star/Petro may make and own Investments in Petro Holdings, but only
with the proceeds of (x) borrowings constituting Star/Petro
Intercompany Subordinated Debt or (y) capital contributions or equity
investments indirectly made by the Public Partnership in Star/Petro on
or after March 25, 1999;
(v) the Borrower or any Restricted Subsidiary may make and own
Investments (A) constituting trade credits or advances to any Person
incurred in the ordinary course of business, (B) arising out of loans
and advances to employees for travel, entertainment and relocation
expenses, in each case incurred in the ordinary course of business or
(C) acquired by reason of the exercise of customary creditors' rights
upon default or pursuant to the bankruptcy, insolvency or
reorganization of a debtor;
(vi) the Borrower or any Restricted Subsidiary may create or
become liable with respect to any Guaranty constituting an obligation,
warranty or indemnity, not guaranteeing Indebtedness of any Person,
which is undertaken or made in the ordinary course of business; and
(vii) the Borrower may create and become liable with respect
to Hedging Agreements and Commodity Hedging Agreements.
Section 6.04 Restricted Payments. (a) The Borrower will not directly or
indirectly declare, order, pay, make or set apart any sum for any Restricted
Payment, except that the Borrower may make, pay or set apart once during each
calendar quarter a Restricted Payment if (i) such Restricted Payment is in an
amount not exceeding Available Cash for the immediately preceding calendar
quarter determined as of the last day of such calendar quarter or thereafter up
to the date of declaration of such Restricted Payment, (ii) prior to and
immediately after giving effect to any such proposed action no condition or
event shall exist which constitutes an Event of Default or Default, (iii) the
ratio of Consolidated Cash Flow to Consolidated Interest Expense for the
Reference Period with respect to the date of such payment is greater than 1.75
to 1.00 and (iv) the Borrower shall have delivered to the Lenders, not later
than the date such Restricted Payment is declared (which declaration date shall
be at least 10 days prior to the date such Restricted Payment is made) an
Officers' Certificate to the effect that such Restricted Payment is permitted
under this Section 6.04 and showing in reasonable detail all calculations
required in arriving at such conclusion, including the calculation of the
aggregate amount available at the end of the preceding quarter for payment of
cash distributions in compliance with this Section 6.04; provided that
Star/Petro may prepay principal amounts outstanding under the Star/Petro
Intercompany Subordinated Debt if and only if (x) the funds used for such
prepayment have been received by Star/Petro directly or indirectly as a capital
contribution made by the Public Partnership or as a dividend from Petro Holdings
on or after March 25, 1999 and (y) prior to and immediately after giving effect
to any such prepayment no condition or event shall exist which constitutes an
Event of Default or Default. The Borrower will not, in any event, directly or
80
indirectly declare, order, pay or make any Restricted Payment except for cash
distributions payable to the holders of its Capital Stock. The Borrower will not
permit any Subsidiary to declare, order, pay or make any Restricted Payment or
to set apart any sum or property for any such purpose (except for Restricted
Payments made solely to the Borrower or any Wholly Owned Restricted Subsidiary).
(b) The Borrower may make, pay or set apart once within 45 days from
the last day of each calendar quarter a Restricted Payment in an amount equal to
the Petro Holdings Dividends, if any; provided that the following conditions are
met: (i) such Restricted Payment is in an amount not exceeding the Petro
Holdings Dividends less any amounts used to pay principal or interest on the
Star/Petro Intercompany Subordinated Debt in accordance with this Agreement,
(ii) prior to and immediately after giving effect to such proposed Restricted
Payment no condition or event shall exist which constitutes an Event of Default
or Default under Section 7.01(b), (iii) prior to and immediately after giving
effect to such proposed Restricted Payment the ratio of Consolidated Cash Flow
plus the Petro Holdings Dividends to Consolidated Interest Expense (excluding
the interest payable on the Star/Petro Intercompany Subordinated Debt, if any)
for the Reference Period with respect to the date of such payment is greater
than 1.75 to 1.00, and (iv) the Borrower shall have given to the Lenders written
notice thereof on the date such Restricted Payment is declared, which date shall
be at least 10 days prior to the date such Restricted Payment is made. The
Borrower will not, in any event, directly or indirectly declare, order, pay or
make any Restricted Payment except in cash.
(c) Notwithstanding any other provision of the Star/Petro Intercompany
Subordinated Note, (i) until all amounts due under the Notes, this Agreement and
each of the other Loan Documents have been paid in full, no principal or
interest payment on the Star/Petro Intercompany Subordinated Note may be made,
except (A) if the proceeds used for such repayment have been received from the
proceeds of capital contributions or equity investments indirectly made by the
Public Partnership in Star/Petro on or after March 25, 1999 or from the proceeds
of dividends received from Petro Holdings, (B) with respect to a payment of
interest on the Star/Petro Intercompany Subordinated Note, the ratio of
Consolidated Cash Flow to Consolidated Interest Expense is greater than 2.0 to
1.0 for the four quarters ending on the calendar quarter immediately preceding
such payment and (C) prior to and immediately after giving effect to any such
interest or principal payment, no condition or event shall exist which
constitutes an Event of Default or Default.
Section 6.05 Transactions with Affiliates. Except for the transactions
or conduct effected pursuant to the Operative Agreements as in effect on the
Closing Date, the Borrower will not, and will not permit any Restricted
Subsidiary to, directly or indirectly, engage in any transaction with any
Affiliate of the Borrower, including the purchase, sale or exchange of assets or
the rendering of any service, except pursuant to the reasonable requirements of
the Borrower's or such Restricted Subsidiary's business and upon fair and
reasonable terms that are no less favorable to the Borrower or such Restricted
Subsidiary, as the case may be, than those which might be obtained in an
arm's-length transaction at the time such transaction is agreed upon from
Persons which are not such an Affiliate; provided that the foregoing limitations
and restrictions shall not apply to any transaction between the Borrower and any
Restricted Subsidiary or between Restricted Subsidiaries.
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Section 6.06 Prohibited Stock and Indebtedness. The Borrower will not:
(a) directly or indirectly sell, assign, pledge or otherwise dispose of
any Indebtedness or Capital Stock of (or warrants, rights or options to acquire
Capital Stock of) any Subsidiary, except (i) to a Restricted Subsidiary and (ii)
in the case of the sale of all the Capital Stock of a Restricted Subsidiary as
an entirety, as permitted under Section 6.07;
(b) permit any Restricted Subsidiary directly or indirectly to sell,
assign, pledge or otherwise dispose of any Indebtedness of (i) the Borrower or
(ii) any other Restricted Subsidiary, or any Capital Stock of (or warrants,
rights or options to acquire Capital Stock of) any other Subsidiary, except (A)
to, in the case of clause (i), the Borrower or, in all other cases, a Restricted
Subsidiary and (B) in the case of the sale of all the Capital Stock of a
Restricted Subsidiary as an entirety, as permitted under Section 6.07;
(c) permit any Restricted Subsidiary to have outstanding any Preferred
Stock (other than Preferred Stock owned by the Borrower); or
(d) permit any Subsidiary directly or indirectly to issue or sell
(including in connection with a merger or consolidation of a Restricted
Subsidiary otherwise permitted by Section 6.07(a)) any of its Capital Stock (or
warrants, rights or options to acquire its Capital Stock) except to the Borrower
or a Restricted Subsidiary; provided that, any Restricted Subsidiary may sell,
assign or otherwise dispose of Indebtedness of the Borrower if, assuming such
Indebtedness were incurred immediately after such sale, assignment or
disposition, such Indebtedness would be permitted under Section 6.01 (and, if
such Indebtedness is secured, such Lien would be permitted pursuant to Section
6.02).
Section 6.07 Consolidation, Merger, Sale of Assets, etc. The Borrower
will not, and will not permit any Restricted Subsidiary to, directly or
indirectly:
(a) consolidate with or merge into any other Person or permit any other
Person to consolidate with or merge into it; provided that any Restricted
Subsidiary may consolidate with or merge into the Borrower or a Restricted
Subsidiary if, in the case of a consolidation with or merger into the Borrower,
the Borrower shall be the surviving Person and if, immediately after giving
effect to such transaction, no condition or event shall exist which constitutes
an Event of Default or Default; or
(b) sell, lease, abandon or otherwise dispose of (i) all or
substantially all its assets or (ii) all Capital Stock of any Restricted
Subsidiary as an entirety; provided that any Restricted Subsidiary may sell,
lease or otherwise dispose of all or substantially all its assets to the
Borrower or to a Restricted Subsidiary; or
(c) sell, lease, abandon or otherwise dispose of any property to any
Person other than the Borrower or any Restricted Subsidiary (except for
dispositions of Inventory in the ordinary course of business); provided that the
Borrower or any Restricted Subsidiary may engage in any such transaction
referred to in this paragraph (c), excluding any such transaction referred to in
paragraph (a) or (b) above, if all of the following conditions are satisfied:
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(i) at least 80% of the consideration therefor shall be in the
form of cash consideration;
(ii) immediately after giving effect to such proposed
disposition no condition or event shall exist which constitutes an
Event of Default or Default;
(iii) either
(A) the aggregate net proceeds of all property so
disposed of (whether or not leased back) by the Borrower and
all Restricted Subsidiaries during the current fiscal year
(including property disposed of through dispositions of
Capital Stock permitted under Section 6.06 or sales of assets
permitted under Section 6.07(b) and including all proceeds
under title insurance policies with respect to real property
and all Net Insurance Proceeds, self-insurance amount and Net
Awards (as defined in the Mortgage) with respect to property
lost as a result of damage, destruction or a taking which have
not been applied to the cost of Restoration (as defined in the
Mortgage)), less the sum of (x) the amount of all such net
proceeds previously applied in accordance with paragraph
(iii)(B) of this Section 6.07(c) and (y) an amount equal to
the purchase price of any assets acquired (so long as (1) such
assets were acquired within 180 days prior to the date of such
disposal of property, (2) the purchase price of such assets
was not previously applied to reduce the amount of net
proceeds of property disposed of under this Section 6.07(c),
(3) such assets were acquired for subsequent replacement of
the property so disposed of or may be productively used in the
United States in the conduct of the Business, (4) such assets
are subject to the Lien of the Collateral Documents and (5) to
the extent such assets were acquired (in whole or in part)
with the proceeds of Indebtedness, such Indebtedness has been
repaid in full), shall not exceed $5,000,000 during such
fiscal year, and when aggregated with such net proceeds of all
prior transactions under this Section 6.07(c), shall not
exceed $15,000,000;
(B) in the event that such net proceeds less the sum
of (x) the amount thereof previously applied in accordance
with this paragraph (iii)(B) and (y) an amount equal to the
purchase price of any assets acquired (so long as (1) such
assets were acquired within 180 days prior to the date of such
disposal of property, (2) the purchase price of such assets
was not previously applied to reduce the amount of net
proceeds of property disposed of under this Section 6.07(c),
(3) such assets were acquired for subsequent replacement of
the property so disposed of or may be productively used in the
United States in the conduct of the Business, (4) such assets
are subject to the Lien of the Collateral Documents and (5) to
the extent such assets were acquired (in whole or in part)
with the proceeds of Indebtedness, such Indebtedness has been
repaid in full)), during the current fiscal year exceed
$5,000,000 or, when aggregated with such net proceeds of all
prior transactions under this Section 6.07(c), exceed
$15,000,000 (the amount of such excess net proceeds actually
realized being herein called "Excess Proceeds"), the Borrower
shall promptly pay over to the Trustee such Excess
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Proceeds not at the time held by the Trustee for application
by the Trustee (I) within 180 days of the date of the disposal
or loss of property, to the acquisition of assets in
replacement of the property so disposed of or lost or of
assets which may be productively used in the United States in
the conduct of the Business (and such newly acquired assets
shall be subjected to the Lien of the Collateral Documents) or
to the cost of Restoration (as defined in the Mortgage), or
(II) to the extent of Excess Proceeds not applied pursuant to
the immediately preceding clause (I), to the payment and/or
prepayment of the Facility Obligations and Parity Debt, if
any, pursuant to Section 2.11, all as provided in Section 4(d)
of the Trust Agreement and Section 2.11, and the Trustee shall
have received an Officers' Certificate from the General
Partner certifying that the consideration received for such
property is at least equal to its fair value (as determined in
good faith by the Board of Directors) and that such
consideration has been applied in accordance with the terms of
this Agreement; and
(iv) in the case of any sale, lease or other disposition of
Collateral which includes real property (or any interest therein), or
any sale, lease or other disposition of Collateral resulting in the
aggregate net proceeds of all such sales, leases or other dispositions
exceeding $10,000,000, the Trustee shall have received an Officers'
Certificate from the General Partner certifying that such sale, lease
or other disposition is in the best interest of the Borrower and will
not have a Material Adverse Effect.
Notwithstanding the foregoing, the Borrower and any Restricted Subsidiary may
sell or dispose of (x) real property assets sold or disposed of within 12 months
of the acquisition of such assets and (y) all other assets sold or disposed of
within 6 months of the acquisition of such assets, in each case referred to in
clause (x) or (y) constituting a portion of an acquired business; provided that
(1) such assets are specifically designated to the Administrative Agent in
writing prior to such acquisition as assets to be disposed of, (2) the
Administrative Agent shall have received an Officers' Certificate from the
General Partner certifying that the consideration received for such property is
at least equal to its fair market value (as determined in good faith by the
General Partner) and (3) no Event of Default or Default shall have occurred and
be continuing. Such dispositions under this paragraph will not be applied
towards the cumulative limitations in paragraph (c)(iii)(A) of this Section
6.07. The Lenders agree to take, at the expense of the Borrower, all actions
necessary to cause dispositions of Collateral made in compliance with this
Section 6.07 to be made free and clear of the liens created by the Collateral
Documents.
Section 6.08 Partnership or Corporate Existence etc.; Business. (a) (i)
The Borrower will at all times preserve and keep in full force and effect its
partnership existence and its status as a partnership not taxable as a
corporation for Federal income tax purposes; (ii) the Borrower will cause each
Restricted Subsidiary to keep in full force and effect its partnership or
corporate existence; and (iii) the Borrower will, and will cause each Restricted
Subsidiary to, at all times preserve and keep in full force and effect all of
its material rights and franchises (in each case except as otherwise
specifically permitted in Sections 6.06 and 6.07 and except that the partnership
or corporate existence of any Restricted Subsidiary, and any right or franchise
of the Borrower or any Restricted Subsidiary, may be terminated if, in the good
faith judgment of the
84
General Partner, such termination is in the best interest of the Borrower, is
not disadvantageous to the Lenders in any material respect and would not have a
Material Adverse Effect).
(b) The Borrower will not, and will not permit any Restricted
Subsidiary to, engage in any material line of business substantially different
than the wholesale and retail sale, distribution, and storage of propane gas and
related petroleum derivative products and the related retail sale of supplies
and equipment, including home appliances.
(c) The Borrower will not, and will not permit any of its Affiliates
to, take any action or refuse to take any reasonable action the effect of which,
if taken or not taken, as the case may be, would be to cause the Public
Partnership or the Borrower to be treated as an association taxable as a
corporation or otherwise to be taxed as an entity other than a partnership for
Federal income tax purposes.
Section 6.09 Payment of Taxes and Claims. The Borrower will, and will
cause each Subsidiary to, pay all taxes, assessments and other governmental
charges or levies imposed upon it or any of its properties or assets or in
respect of any of its franchises, business, income or profits when the same
become due and payable, but in any event before any penalty or interest accrues
thereon, and all claims (including claims for labor, services, materials and
supplies) for sums which have become due and payable and which by law have or
might become a Lien upon any of its properties or assets, and promptly reimburse
the Agents, the Issuing Bank and the Lenders for any such taxes, assessments,
charges or claims paid by them; provided that no such tax, assessment, charge or
claim need be paid or reimbursed if being contested in good faith by appropriate
proceedings promptly initiated and diligently conducted and if such reserves or
other appropriate provision, if any, as shall be required by GAAP shall have
been made therefor and be adequate in the good faith judgment of the General
Partner.
Section 6.10 Compliance with ERISA. The Borrower will not, and will not
permit any Subsidiary or Related Person of the Borrower to:
(a)(i) engage in any transaction in connection with which the Borrower
or any Subsidiary could be subject to either a civil penalty assessed pursuant
to Section 502(i) of ERISA or a tax imposed by Section 4975 of the Code, (ii)
terminate (within the meaning of Title IV of ERISA) or withdraw from any Plan in
a manner, or take, or fail to take, any other action with respect to any Plan
(including a substantial cessation of operations within the meaning of Section
4062(e) of ERISA), (iii) establish, maintain, contribute to or become obligated
to contribute to any welfare benefit plan (as defined in Section 3(1) of ERISA)
or other welfare benefit arrangement which provides post-employment benefits,
which cannot be unilaterally terminated by the Borrower, (iv) fail to make full
payment when due of all amounts which, under the provisions of any Plan or
applicable law, the Borrower or any Subsidiary or Related Person of the Borrower
is required to pay as contributions thereto, result in the imposition of a Lien
or permit to exist any material accumulated funding deficiency, whether or not
waived, with respect to any Plan or (v) engage in any transaction in connection
with which the Borrower, any Subsidiary or any Related Person of the Borrower
could be subject to liability pursuant to section 4069(a) or 4212(c) of ERISA,
if, as a result of any such event, condition or transaction described in clauses
(i) through (v) above, either individually or together with any other such event
or
85
condition, could result in (x) the imposition of a Lien on any assets or
property of the Borrower or any Related Person or (y) any liability to the
Borrower, any Subsidiary or any Related Person of the Borrower, which liability
could have a Material Adverse Effect; or
(b) as of any date of determination (i) permit the amount of unfunded
benefit liabilities under any Plan maintained at such time by the Borrower or
any Subsidiary or Related Persons of the Borrower to exceed the current value of
the assets of any such Plan by more than $250,000 or (ii) permit the aggregate
liability incurred by the Borrower and any Subsidiary and Related Persons of the
Borrower pursuant to Title IV of ERISA with respect to one or more terminations
of, or one or more complete or partial withdrawals from, any Plan to exceed
$1,000,000.
As used in this Section 6.10, the term "accumulated funding deficiency" has the
meaning specified in Section 302 of ERISA and Section 412 of the Code, the term
"current value" has the meaning specified in Section 3 of ERISA and the terms
"benefit liabilities" and "amount of unfunded benefit liabilities" have the
meanings specified in Section 4001 of ERISA.
Section 6.11 Maintenance of Properties; Insurance. (a) The Borrower
will maintain or cause to be maintained in working order and condition, in
accordance with normal industry standards, all properties used or useful in the
business of the Borrower and the Restricted Subsidiaries and from time to time
will make or cause to be made all appropriate repairs, renewals and replacements
thereof.
(b) The Borrower will, and will cause each of the Restricted
Subsidiaries to, keep its insurable properties adequately insured at all times
by Permitted Insurers; maintain such other insurance, to such extent and against
such risks, including fire and other risks insured against by extended coverage,
as is customary with companies in the same or similar businesses, including
public liability insurance against claims for personal injury or death or
property damage occurring upon, in, about or in connection with the use of any
properties owned, occupied or controlled by it; maintain such other insurance as
may be required by law or any Collateral Document; and cause each such insurance
policy to name the Trustee, on behalf of the Secured Parties, as an additional
insured or loss payee thereunder. The Borrower will permit the Agents and an
insurance consultant retained by the Agents, at the expense of the Borrower, to
review the insurance policies maintained by the Borrower on an annual basis and
will implement any changes to such policies reasonably recommended by such
consultant.
Section 6.12 Operative Agreements; Collateral Documents. The Borrower
will, and will cause each Restricted Subsidiary to, perform and comply with all
of its obligations under each of the Operative Agreements to which it is a
party, will enforce each such Operative Agreement against each other party
thereto and will not accept the termination of any such Operative Agreement,
unless the taking of or omitting to take any such action would not have a
Material Adverse Effect and would not be disadvantageous in any material respect
to the Lenders. The Borrower will not, and will not permit any other Loan Party
to, amend, modify or supplement any Operative Agreement or its partnership
agreement, certificate of incorporation or by-laws without the prior written
consent of the Required Lenders; provided that (i) the MLP Agreement and the
Partnership Agreement may be amended, modified or supplemented without
86
the prior written consent of the Required Lenders if such amendment,
modification or supplement would not have a Material Adverse Effect and the
Borrower shall have delivered to each Lender a copy of such proposed amendment,
modification or supplement together with an Officer's Certificate describing
such proposed amendment, modification or supplement and confirming that such
proposed amendment, modification or supplement would not have a Material Adverse
Effect and (ii) the Note Agreement may be amended, modified or supplemented
without the prior written consent of the Required Lenders if such amendment,
modification or supplement may be made without the written consent of any
Lenders under the Trust Agreement. The Borrower will not, and will not cause or
permit any of the Restricted Subsidiaries to, enter into any Material Contract,
or any amendment, modification or waiver in respect of any term or condition of
any Material Contract, other than any such contract or any such amendments,
modifications and waivers in respect thereof which could not reasonably be
expected to have a Material Adverse Effect.
Section 6.13 Chief Executive Office. The Borrower will not move its
chief executive office and the office at which it maintains its records relating
to the transactions contemplated by this Agreement and the Collateral Documents
or change its state of incorporation unless (a) not less than 45 days' prior
written notice of its intention to do so, clearly describing the new location or
state, shall have been given to the Trustee and each Lender and (b) such action,
reasonably satisfactory to the Trustee and each Lender, to maintain any security
interest in the property subject to the Collateral Documents at all times fully
perfected and in full force and effect shall have been taken.
Section 6.14 [Intentionally Omitted].
Section 6.15 Covenant to Secure Notes Equally. The Borrower covenants
that, if it or any Restricted Subsidiary shall create or assume any Lien upon
any of its property or assets, whether now owned or hereafter acquired, other
than Liens permitted by the provisions of Section 6.02 (unless prior written
consent to the creation or assumption thereof shall have been obtained from the
Required Lenders), it will make or cause to be made effective provision whereby
the Facility Obligations will be secured by such Lien equally and ratably with
any and all other Indebtedness thereby secured so long as any such other
Indebtedness shall be so secured; provided, however, that the provision of such
equal and ratable security shall not constitute a cure or waiver of any related
Event of Default.
Section 6.16 Compliance with Laws. (a) The Borrower will, and will
cause each Subsidiary to, comply with all applicable statutes, rules,
regulations, and orders of, and all applicable restrictions imposed by, the
United States of America, foreign countries, states, provinces and
municipalities, and of or by any Governmental Authority, including any court,
arbitrator or grand jury, in respect of the conduct of their respective
businesses and the ownership of their respective properties or business, except
such as are being contested in good faith by appropriate proceedings promptly
initiated and diligently conducted and if such reserve or other appropriate
provision, if any, as shall be required by GAAP shall have been made therefor or
the failure to so comply could not reasonably be expected to have a Material
Adverse Effect.
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(b) The Borrower will, and will cause each Restricted Subsidiary to,
comply with all Environmental Laws, other than noncompliance which could not
reasonably be expected to result in a Material Adverse Effect, individually or
in the aggregate with any other liability under any Environmental Laws.
(c) The Borrower will, and will cause each Restricted Subsidiary to,
promptly give notice to the Administrative Agent upon becoming aware of (i) any
violation of or notice of potential liability under any Environmental Law or
(ii) any release or threatened release of any Hazardous Material at, on, into,
under or from any real property of any facility or equipment thereat in excess
of reportable or allowable standards or levels under any Environmental Law, or
in a manner and/or amount which could reasonably be expected to result in
liability under any Environmental Law, which liability would result in a
Material Adverse Effect.
(d) The Borrower will, and will cause each Restricted Subsidiary to,
promptly provide the Administrative Agent with copies of any notice, submission
or documentation provided by the Borrower or any Restricted Subsidiary to the
Governmental Authority or third party under any Environmental Law if the matter
which is the subject of the notice, submission or other documentation could
reasonably be expected to have a Material Adverse Effect. Such notice,
submission or documentation shall be provided to the Administrative Agent
promptly and, in any event, within 30 days after such material is provided to
the Governmental Authority or third party.
Section 6.17 Further Assurances. (a) At any time and from time to time
promptly, the Borrower shall, at its expense, execute and deliver to each Lender
and to the Trustee such further instruments and documents, and take such further
action, as may be required under applicable law or as the Lenders may from time
to time reasonably request, in order to further carry out the intent and purpose
of this Agreement and to establish and protect the rights, interests and
remedies created, or intended to be created, in favor of the Lenders.
(b) Without limitation of Section 6.17(a), the Borrower will, and will
cause the Subsidiaries to, perform any and all acts and execute any and all
documents (including the execution, amendment, supplementation, delivery and
recordation and filing of security agreements and financing statements and
continuation statements under the Uniform Commercial Code of any applicable
jurisdiction) for filing under the provisions of the Uniform Commercial Code and
the rules and regulations thereunder, or any other statute, rule or regulation
of any applicable foreign, Federal, state or local jurisdictions, including any
filings in the United States Patent and Trademark Office or similar foreign
office, which are necessary (or reasonably requested by the Agents), from time
to time, in order to grant and maintain in favor of the Trustee for the ratable
benefit of the Secured Parties a security interest in each item of the
Collateral of the type and priority described in the relevant Collateral
Document, perfected to the extent contemplated hereby and thereby.
(c) Without limitation of Section 6.17(a), the Borrower will, and will
cause the Subsidiaries to, deliver or cause to be delivered to the Lenders from
time to time such other documentation, consents, authorizations, approvals and
orders in form and substance satisfactory to the Agents, as the Agents shall
deem reasonably necessary or advisable to perfect or maintain
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the Liens for the benefit of the Secured Parties, including assets which are
required to become Collateral after the Closing Date.
Section 6.18 Subsidiaries. (a) The Borrower may designate any
Restricted Subsidiary or newly acquired or formed Wholly Owned Subsidiary
satisfying the requirements in clauses (a), (b) and (c) of the definition of
Restricted Subsidiary as an Unrestricted Subsidiary or any Unrestricted
Subsidiary or newly acquired or formed Subsidiary as a Restricted Subsidiary, in
each case subject to satisfaction of the following conditions:
(i) immediately before and after giving effect to such
designation no condition or event shall exist which constitutes an
Event of Default or Default;
(ii) immediately after giving effect to such designation, (A)
except in the case of a designation as a Restricted Subsidiary of an
Unrestricted Subsidiary that does not have any Indebtedness and that
has positive Consolidated Cash Flow for the most recent Reference
Period, the Borrower would be permitted to incur at least $l of
additional Indebtedness in compliance with paragraphs (i) and (ii) of
Section 6.01(f), (B) the Borrower and the Restricted Subsidiary would
not be liable with respect to Indebtedness or any Guarantee, would not
own any Investment and their property would not be subject to any Lien
which is not permitted by this Agreement and (C) substantially all of
the Borrower's assets will be located, and substantially all of the
Borrower's business will be conducted, in the United States;
(iii) in the case of a designation as an Unrestricted
Subsidiary, (A) if such designation (and all other prior designations
of Restricted Subsidiaries or newly acquired or formed Subsidiaries as
Unrestricted Subsidiaries during the current fiscal year) were deemed
to constitute a sale by the Borrower of all the assets of the
Subsidiary so designated, such sale would be in compliance with
paragraph (iii)(A) of Section 6.07(c) and (B) if such designation (and
all other prior designations of Restricted Subsidiaries or newly
acquired or formed Subsidiaries as Unrestricted Subsidiaries during the
current fiscal year) were deemed to constitute an Investment by the
Borrower in respect of all the assets of the Subsidiary so designated,
such Investment would be in compliance with clause (iv) of Section
6.03, in each case with the net proceeds of such sale or the amount of
such Investment being deemed to equal the net book value of such assets
in the case of a Restricted Subsidiary or the cost of acquisition or
formation in the case of a newly acquired or formed Subsidiary;
provided that this subdivision (iii) of this Section 6.18(a) shall not
apply to an acquisition or formation by the Borrower or a Restricted
Subsidiary of a newly acquired or formed Unrestricted Subsidiary to the
extent such acquisition or formation is funded solely by the net cash
proceeds received by the Borrower from the General Partner or from the
Public Partnership as a capital contribution or as consideration for
the issuance by the Public Partnership of additional limited
partnership interests;
(iv) in the case of a designation of a Restricted Subsidiary
as an Unrestricted Subsidiary, such Restricted Subsidiary shall not
have been an Unrestricted Subsidiary prior to being designated a
Restricted Subsidiary;
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(v) in the case of a designation of an Unrestricted Subsidiary
as a Restricted Subsidiary, such Unrestricted Subsidiary at the time of
such designation has a positive consolidated net worth;
(vi) the Borrower shall deliver to each Lender, within five
Business Days after any such designation, an Officer's Certificate
stating the effective date of such designation and confirming
compliance with the provisions of this Section 6.18;
(vii) in the case of the designation of any Unrestricted
Subsidiary as a Restricted Subsidiary, such new Restricted Subsidiary
shall be deemed to have (a) made or acquired all Investments owned by
it and (b) incurred all Indebtedness owing by it and all Liens to which
it or any of its properties are subject, on the date of such
designation;
(viii) the Borrower shall designate Star/Petro as a Restricted
Subsidiary and, notwithstanding any other provision of this Section
6.18 (a), shall not change such designation without the consent of the
Required Lenders; and
(ix) the Borrower shall designate Petro Holdings as an
Unrestricted Subsidiary and, notwithstanding any other provision of
this Section 6.18 (a), shall not change such designation without the
consent of the Required Lenders.
(b) The Borrower will cause each Restricted Subsidiary, at the time it
is or is deemed to be designated as a Restricted Subsidiary, to execute and
deliver a Supplemental Agreement and satisfy all terms therein.
(c) The Borrower will not own any Subsidiaries other than Wholly Owned
Subsidiaries satisfying the requirements in clauses (a), (b) and (c) of the
definition of Restricted Subsidiary.
Section 6.19 Certain Post-Closing Matters. (a) Every six months, the
Borrower shall deliver, or cause to be delivered, to the Lenders a title
bringdown report for each of the Mortgaged Properties set forth on Schedule 6.19
attached hereto showing no further liens or encumbrances affecting such
Mortgaged Properties except for those existing as of the Closing Date and
approved by the Lenders in writing.
(b) [Intentionally Omitted].
(c) [Intentionally Omitted].
Section 6.20 Use of Proceeds. The Borrower will use the proceeds of the
Loans and will use the Letters of Credit only for the purposes set forth in
Section 3.13.
Section 6.21 Accounting Changes. The Borrower will not, and will not
suffer or permit any Restricted Subsidiary to, make any significant change in
accounting treatment or reporting practices, except as required by GAAP. The
Borrower will, and will cause each Restricted Subsidiary to, cause its fiscal
year to end on September 30 in each year.
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Section 6.22 Certain Real Property. Without affecting the obligations
of the Borrower or any of the Restricted Subsidiaries under any of the
Collateral Documents, in the event that the Borrower or any Restricted
Subsidiary, at any time after the date hereof, whether directly or indirectly,
acquires any interest in any real property, including any fee or other ownership
interest in one or more properties with an aggregate cost in excess of $50,000,
or any interest under one or more leases of real property for a term in excess
of three years and involving aggregate average payments in excess of $100,000
per annum (each such interest, an "After Acquired Property"), the Borrower will,
or will cause such Restricted Subsidiary to, as soon as practical provide
written notice thereof to the Administrative Agent, setting forth with
specificity a description of such After Acquired Property, the location of such
After Acquired Property, any structures or improvements thereon and an appraisal
or its good-faith estimate of the current value of such real property ("Current
Value"). The Administrative Agent shall provide notice to the Borrower of
whether the Required Lenders intend to cause the Borrower or the applicable
Restricted Subsidiary to grant and record a Mortgage on such After Acquired
Property; provided, that no new Mortgage on such After Acquired Property shall
be required if the costs that would be incurred as a result thereof are
excessive in relation to the benefits that would be conferred thereby. In such
event, the Borrower or such Restricted Subsidiary shall execute and deliver to
the Administrative Agent a Mortgage, together with such of the documents or
instruments referred to in Sections 4.01(d) and 4.01(e) as the Agents shall
require. If, at any time, the aggregate cost to the Borrower and its Restricted
Subsidiaries of each interest in real property (x) acquired by the Borrower or
any Restricted Subsidiary, whether directly or indirectly, at any time after the
Closing Date, at a cost equal to or less than $50,000, (y) at such time, owned
directly or indirectly by the Borrower or any Restricted Subsidiary and (z) for
which a mortgage in favor of the Trustee is not in effect (the "Aggregate Cost
of Unmortgaged Property"), exceeds $500,000, the Borrower will as soon as
practical, and in any event within 10 Business Days, provide written notice
thereof to the Administrative Agent, setting forth with specificity a
description of each such interest in real property, the location of such real
property and an appraisal or its good-faith estimate of the current value of
each such real property. The Administrative Agent may require the Borrower or
the applicable Restricted Subsidiary to grant and record a mortgage in favor of
the Trustee on one or more of such real properties so that the Aggregate Cost of
Unmortgaged Property does not exceed $500,000, provided that no new mortgage on
any such real property shall be required if the costs that would be incurred as
a result thereof are excessive in relation to the benefit that would be
conferred thereby. In the event a mortgage is required, the Borrower or such
Restricted Subsidiary shall execute and deliver to the Trustee a mortgage,
together with such documents or instruments as the Administrative Agent shall
require. In no event shall the title insurance policy for any such After
Acquired Property be in an amount which is less than the Current Value of such
After Acquired Property. Further, with regard to any interest in real property,
including any fee or other ownership interest in real property or any material
lease of real property, currently owned or held by the Borrower or any
Restricted Subsidiary and which is not being encumbered by a Mortgage of even
date herewith (each such interest, an "Existing Unmortgaged Property"), upon the
written request of the Required Lenders, the Borrower will, or will cause any
applicable Restricted Subsidiary to, execute and deliver to the Administrative
Agent a Mortgage, together with such of the documents or instruments referred to
in Section 4.01(d) and 4.01(e) as the Agents shall require. In no event shall
the title insurance policy for any such Existing Unmortgaged Property be in an
amount which is less than the Current Value
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of such Existing Unmortgaged Property. The Borrower shall pay all fees and
expenses, including reasonable attorneys' fees and expenses and expenses of any
customary environmental due diligence, and all title insurance charges and
premiums, in connection with the obligations of the Borrower and the Restricted
Subsidiaries under this Section 6.22.
Section 6.23 Sale and Lease-Back Transactions. The Borrower will not,
and will not cause or permit any of the Restricted Subsidiaries to, enter into
any arrangement, directly or indirectly, with any Person whereby it shall sell
or transfer any property, real or personal, used or useful in its business,
whether now owned or hereafter acquired, with an intent to rent or lease such
property or other property which it intends to use for substantially the same
purpose or purposes as the property being sold or transferred.
Section 6.24 Acquisitions. Except as permitted by Section 6.07, the
Borrower will not, and will not cause or permit any of the Restricted
Subsidiaries to, purchase, lease or otherwise acquire (in one transaction or a
series of transactions) all or any substantial part of the assets of any other
Person, except that (a) the Borrower and any of the Restricted Subsidiaries may
purchase inventory in the ordinary course of business and (b) the Borrower or
any Restricted Subsidiary may engage in any such acquisition if no Event of
Default or Default has occurred and is continuing at the time of any such
acquisition or would occur immediately after giving effect thereto.
Section 6.25 Impairment of Security Interests. The Borrower will not,
and will not permit any of the Subsidiaries to, take or omit to take any action,
which action or omission might or would have the result of materially impairing
the security interests in favor of the Trustee on behalf of the Secured Parties
with respect to the Collateral, and the Borrower will not, and will not permit
any of the Subsidiaries to, grant to any Person (other than the Trustee on
behalf of the Secured Parties) any interest whatsoever in the Collateral.
Section 6.26 Limitation on Restrictions on Subsidiary Dividends, etc.
The Borrower will not, and will not cause or permit any of the Restricted
Subsidiaries to, directly or indirectly, create or otherwise cause or suffer to
exist or become effective any consensual encumbrance or restriction on the
ability of any Restricted Subsidiary to (a) pay dividends or make any other
distributions on or in respect of its Capital Stock, or pay any indebtedness
owed to the Borrower or any Restricted Subsidiary, (b) make loans or advances to
the Borrower or any Restricted Subsidiary or (c) transfer any of its properties
or assets to the Borrower or any Restricted Subsidiary, except for such
encumbrances or restrictions existing under or by reason of (i) customary
non-assignment provisions in any lease governing a leasehold interest or other
contract entered into in the ordinary course of business consistent with past
practices or (ii) this Agreement, the other Loan Documents or the Note
Agreement.
Section 6.27 No Other Negative Pledges. The Borrower will not, and will
not cause or permit any of the Restricted Subsidiaries to, directly or
indirectly, enter into any agreement prohibiting the creation or assumption of
any Lien upon the properties or assets of the Borrower or any Restricted
Subsidiary, whether now owned or hereafter acquired, or requiring an obligation
to be secured if some other obligation is secured, except for this Agreement,
the Note
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Agreement, the Existing Credit Agreement, the 1998 Parity Notes, the 2000 Parity
Notes or the 2001 Parity Notes.
Section 6.28 Sales of Receivables. The Borrower will not, and will not
cause or permit any of the Restricted Subsidiaries to, sell with recourse,
discount or otherwise sell or dispose of its notes or accounts receivable,
except for accounts receivable consisting of assets of an operating unit sold as
a going concern in accordance with all other provisions of this Agreement.
Section 6.29 Fixed Price Supply Contracts; Certain Policies. (a) The
Borrower will not, and will not permit any of the Restricted Subsidiaries to, at
any time be a party or subject to any contract for the purchase or supply by
such parties of propane or other product except where (i) the purchase price is
set with reference to a spot index or indices substantially contemporaneously
with the delivery of such product or (ii) delivery of such propane or other
product is to be made no more than one year after the purchase price is agreed
to.
(b) The Borrower will not amend, modify or waive the trading policy or
supply inventory position policy referred to in Section 3.29, except that the
Borrower may enter into Commodity Hedging Agreements as permitted under the
other provisions hereof. The Borrower will provide the Agents and the Lenders
with prompt written notice of any such new Commodity Hedging Agreement. Subject
to the foregoing exception, the Borrower and the Restricted Subsidiaries will
comply in all material respects with such policies at all times.
Section 6.30 Certain Operations. The Borrower shall not permit Petro or
any of its Affiliates (other than the Borrower and the Restricted Subsidiaries)
to acquire a business which derives any revenues from the sale of propane if,
after giving effect to such acquisition, Petro's Pro Forma Propane Volumes (as
defined below) would equal or exceed the lesser of (a) 15% of the Borrower's
reported propane volumes sold for the most recently completed four fiscal
quarters which ended at least 90 days prior to the date of such acquisition and
(b) 15 million gallons of propane (such lesser amount, the "maximum permitted
amount"). If as a result of an acquisition, Petro's Pro Forma Propane Volumes
exceeds the maximum permitted amount, the Borrower shall not be in violation of
this Section 6.30 if within the period of 90 days following such acquisition the
Borrower causes Petro to complete the disposition of sufficient propane volume
to reduce Petro's Pro Forma Propane Volumes below the maximum permitted amount.
For purposes of this Section 6.30, "Petro's Pro Forma Propane Volumes" shall
mean the actual propane volumes sold by Petro and any of its Affiliates (other
than the Borrower and the Restricted Subsidiaries) for the most recently
completed four fiscal quarters which ended at least 90 days prior to the date of
determination plus the propane volumes sold of the propane business to be
acquired for the most recently completed four fiscal quarters which ended at
least 90 days prior to the date of determination. In addition, in the event
Petro or any of its Affiliates (other than the Borrower and the Restricted
Subsidiaries) owns a propane business, the Borrower shall not permit Petro or
any such Affiliate to accept as a customer (except for de minimis, unintentional
and isolated acceptances) any Person who is (or was during the last billing
cycle of the Borrower and the Restricted Subsidiaries) a customer of the
Borrower and the Restricted Subsidiaries.
Section 6.31 [Intentionally Omitted].
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Section 6.32 Independent Corporate Existence. Except as set forth on
Schedule 6.32, (a) the Borrower shall maintain, and shall cause each of its
Subsidiaries (other than Petro Holdings or its Subsidiaries) to maintain, books,
records and accounts that are separate from the books, records and accounts of
Petro or any of its Subsidiaries such that: (i) the revenues of the Borrower and
its Subsidiaries will be credited to the accounts of the Borrower and its
Subsidiaries only; (ii) all expenses incurred by the Borrower and its
Subsidiaries shall be paid only from the accounts of the Borrower and its
Subsidiaries (other than those paid by Petro and allocated to the Borrower in
the manner set forth in clause (c) of this Section); (iii) only officers and
employees of the General Partner, the Borrower and its Subsidiaries in their
capacity as such shall have the authority to make disbursements with respect to
the accounts of the Borrower and its Subsidiaries; (iv) there shall occur no
sharing of accounts or funds between the Borrower and its Subsidiaries, on the
one hand, and Petro or any of its Subsidiaries (other than the Borrower and its
Subsidiaries), on the other hand; and (v) all cash and funds of the Borrower and
its Subsidiaries shall be managed separately from the cash and funds of Petro or
any of its Subsidiaries (other than the Borrower and its Subsidiaries), and
there shall not occur any commingling, including for investment purposes, of
funds or assets of the Borrower and its Subsidiaries with the funds or assets of
Petro or any of its Subsidiaries.
(b) All full-time employees, consultants and agents of the Borrower and
its Subsidiaries (other than Petro Holdings or its Subsidiaries) shall be
compensated directly from the bank accounts of the General Partner, the Borrower
and such Subsidiaries (other than Petro Holdings or its Subsidiaries) for
services provided by such employees, consultants and agents and, to the extent
any employee, consultant or agent is also an employee, consultant or agent of
Petro or any of its Subsidiaries, the compensation of such employee, consultant
or agent shall be allocated in accordance with clause (c) of this Section among
the Borrower and its Subsidiaries, on the one hand, and Petro and any of its
Subsidiaries, on the other hand, on a basis which reasonably reflects the
services rendered to the Borrower and its Subsidiaries (other than Petro
Holdings or its Subsidiaries).
(c) All overhead expenses (including telephone and other utility
charges) for items shared by the Borrower and its Subsidiaries, on the one hand,
and Petro or any of its Subsidiaries (other than Petro Holdings or its
Subsidiaries), on the other hand, shall be allocated on the basis of actual use
to the extent practicable and, to the extent such allocation is not practicable,
on a basis reasonably related to actual use.
(d) The Borrower shall not permit Petro or any of its Subsidiaries to
be named as a loss payee or additional insured on the insurance policy covering
the property of the Borrower or any of its Subsidiaries (other than Petro
Holdings or its Subsidiaries), or enter into an agreement with the holder of
such policy whereby in the event of a loss in connection with such property,
proceeds are paid to Petro and its Subsidiaries.
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ARTICLE VII
EVENTS OF DEFAULT
Section 7.01 Events of Default. In case of the happening of any of the
following events ("Events of Default"):
(a) (i) default shall be made in the payment of any principal of any
Loan or any reimbursement obligation in respect of a Letter of Credit when and
as the same shall become due and payable, whether at the due date thereof or at
a date fixed for prepayment thereof or by acceleration thereof or otherwise and
(ii) the Borrower shall fail to maintain Loans outstanding in a minimum
principal amount of at least $2,000,000;
(b) default shall be made in the payment of any interest on any Loan or
any Fee or any other amount (other than an amount referred to in paragraph (a)
above) due under any Loan Document, when and as the same shall become due and
payable, and such default shall continue unremedied for a period of five
Business Days;
(c) default shall be made in the due observance or performance by the
Borrower or any Subsidiary of any covenant, condition or agreement contained in
Section 5.02(h) or any of Sections 6.01 through 6.08, inclusive, Section 6.10,
Section 6.11 (other than the failure to deliver any broker report on a timely
basis as required by Section 15.3 of the Mortgage) and Sections 6.18 through
6.30, inclusive, of this Agreement or in Section 4.21 or 4.23 of the Borrower
Security Agreement;
(d) default shall be made in the due observance or performance by the
Borrower or any other Loan Party of any covenant, condition or agreement
contained in any Loan Document (other than those specified in paragraph (a), (b)
or (c) above) and such default shall continue unremedied for a period of 30 days
after such default shall first have become known to any officer of any Loan
Party or written notice thereof shall have been received by the Borrower from
the Administrative Agent or any Lender;
(e) any representation or warranty made in writing or deemed made by or
on behalf of the Borrower or any of its Affiliates in this Agreement, any other
Operative Agreement or in any instrument furnished in connection with the
Transactions shall prove to have been false or incorrect in any material respect
on the date as of which made or deemed made;
(f) the Borrower or any Restricted Subsidiary (as principal or
guarantor or other surety) shall default in the payment of any amount of
principal of or premium or interest on Indebtedness which is outstanding in a
principal amount of at least $2,000,000 in the aggregate (other than the
Facility Obligations) or the Existing Credit Agreement or on the Mortgage Notes;
or any event shall occur or condition shall exist in respect of any Indebtedness
which is outstanding in a principal amount of at least $2,000,000 or the
Existing Credit Agreement or the Mortgage Notes or under any evidence of any
such Indebtedness or the Existing Credit Agreement, the Mortgage Notes or of any
mortgage, indenture or other agreement relating to such Indebtedness or the
Existing Credit Agreement or the Mortgage Notes, the effect of which
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is to cause (or to permit one or more Persons to cause) such Indebtedness or the
Existing Credit Agreement or the Mortgage Notes to become due before its stated
maturity or before its regularly scheduled dates of payment or to permit the
holders of such Indebtedness or the Existing Credit Agreement or the Mortgage
Notes to cause the Borrower or any Restricted Subsidiary to repurchase or repay
such Indebtedness or the Existing Credit Agreement or the Mortgage Notes, and
such default, event or condition shall continue for more than the period of
grace, if any, specified therein and shall not have been waived pursuant
thereto;
(g) filing by or on the behalf of the Borrower or the General Partner
of a voluntary petition or an answer seeking reorganization, arrangement,
readjustment of its debts or for any other relief under any bankruptcy,
reorganization, compromise, arrangement, insolvency, readjustment of debt,
dissolution or liquidation or similar act or law, state or Federal, now or
hereafter existing ("Bankruptcy Law"), or any action by the Borrower or the
General Partner for, or consent or acquiescence to, the appointment of a
receiver, trustee or other custodian of the Borrower, or the General Partner, or
of all or a substantial part of its property; or the making by the Borrower or
the General Partner of any assignment for the benefit of creditors; or the
admission by the Borrower or the General Partner in writing of its inability to
pay its debts as they become due;
(h) filing of any involuntary petition against the Borrower or the
General Partner in bankruptcy or seeking reorganization, arrangement,
readjustment of its debts or for any other relief under any Bankruptcy Law and
an order for relief by a court having jurisdiction in the premises shall have
been issued or entered therein; or any other similar relief shall be granted
under any applicable Federal or state law; or a decree or order of a court of
competent jurisdiction for the appointment of a receiver, liquidator,
sequestrator, trustee or other officer having similar powers over the Borrower
or the General Partner or over all or a part of its property shall have been
entered; or the involuntary appointment of an interim receiver, trustee or other
custodian of the Borrower or the General Partner or of all or a substantial part
of its property; or the issuance of a warrant of attachment, execution or
similar process against any substantial part of the property of the Borrower or
the General Partner; and continuance of any such event for 60 consecutive days
unless dismissed, bonded to the satisfaction of the court of competent
jurisdiction or discharged;
(i) filing by or on the behalf of any Restricted Subsidiary of a
voluntary petition or an answer seeking reorganization, arrangement,
readjustment of its debts or for any other relief under any Bankruptcy Law, or
any action by any Restricted Subsidiary for, or consent or acquiescence to, the
appointment of a receiver, trustee or other custodian of such Restricted
Subsidiary or of all or a substantial part of its property; or the making by any
Restricted Subsidiary of any assignment for the benefit of creditors; or the
admission by any Restricted Subsidiary in writing of its inability to pay its
debts as they become due;
(j) filing of any involuntary petition against any Restricted
Subsidiary in bankruptcy or seeking reorganization, arrangement, readjustment of
its debts or for any other relief under any Bankruptcy Law and an order for
relief by a court of competent jurisdiction shall have been issued or entered
therein; or any other similar relief shall be granted under any applicable
Federal or state law; or a decree or order of a court having jurisdiction in the
premises for the
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appointment of a receiver, liquidator, sequestrator, trustee or other officer
having similar powers over any Restricted Subsidiary or over all or a part of
its property shall have been entered; or the involuntary appointment of an
interim receiver, trustee or other custodian of any Restricted Subsidiary or of
all or a substantial part of its property; or the issuance of a warrant of
attachment, execution or similar process against any substantial part of the
property of any Restricted Subsidiary; and continuance of any such event for 60
consecutive days unless dismissed, bonded to the satisfaction of the court of
competent jurisdiction or discharged;
(k) a final judgment or judgments (which is or are non-appealable or
which has or have not been stayed pending appeal or as to which all rights to
appeal have expired or been exhausted) shall be rendered against the Borrower or
any Restricted Subsidiary for the payment of money in excess of $1,000,000 in
the aggregate and any one of such judgments shall not be discharged or execution
thereon stayed pending appeal within 45 days after the date due, or, in the
event of such a stay, such judgment shall not be discharged within 30 days after
such stay expires, or any action shall be legally taken by a judgment creditor
to levy upon assets or properties of the Borrower or any Restricted Subsidiary
to enforce any such judgment;
(l) any of the Loan Documents or other Operative Agreements shall at
any time, for any reason, cease to be in full force and effect or shall be
declared to be null and void in whole or in any material part by the final
judgment (which is non-appealable or has not been stayed pending appeal or as to
which all rights to appeal have expired or been exhausted) of any court or other
governmental or regulatory authority having jurisdiction in respect thereof, or
the validity or the enforceability of any of the Loan Documents or other
Operative Agreements shall be contested by or on behalf of the Borrower or any
other Loan Party, or the Borrower or any other Loan Party shall renounce any of
the Loan Documents or other Operative Agreements, or deny that it is bound by
the terms of any of the Loan Documents or other Operative Agreements;
(m) any Lien purported to be created by any Collateral Document shall
cease to be, or shall for any reason be asserted by the Borrower or any other
Loan Party not to be, a valid, perfected, first priority Lien on the securities,
properties or assets covered thereby, other than as a result of an act or
omission of any Agent or Lender;
(n) any order, judgment or decree is entered in any proceedings against
the Borrower decreeing a split-up of the Borrower which requires the divestiture
of assets of the Borrower or the divestiture of the stock of a Restricted
Subsidiary which would not be permitted if such divestiture were considered a
partial disposition of assets pursuant to Section 6.07(c) and such order,
judgment or decree shall not be dismissed or execution thereon stayed pending
appeal within 30 days after entry thereof, or, in the event of such a stay, such
order, judgment or decree shall not be discharged within 30 days after such stay
expires;
(o) there shall occur at any time a change in Legal Requirements
specifically applicable to the Borrower or to the Business or to the business of
the wholesale and retail sale, distribution and storage of propane gas and
related petroleum derivative products and the related retail sale of supplies
and equipment, including home appliances which would have a Material Adverse
Effect and 60 days after the earlier of (i) such occurrence shall first have
become known to any officer of the Borrower or the General Partner or (ii)
written notice thereof shall have been
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received by the Borrower from the Administrative Agent or any Lender, such
Material Adverse Effect shall be continuing;
(p) [Intentionally Omitted];
(q) [Intentionally Omitted];
(r) any Governmental Authority revokes or fails to renew any material
license, permit or franchise of the Borrower or any Restricted Subsidiary, or
the Borrower or any Restricted Subsidiary for any reason loses any material
license, permit or franchise, or the Borrower or any Restricted Subsidiary
suffers the imposition of any restraining order, escrow, suspension or impound
of funds in connection with any proceeding (judicial or administrative) with
respect to any material license, permit or franchise;
(s) [Intentionally Omitted];
(t) [Intentionally Omitted]; or
(u) [Intentionally Omitted];
then, and in every such event, and at any time thereafter during the continuance
of such event, the Administrative Agent may, and at the request of the Required
Lenders shall, take one or more of the following actions, at the same or
different times: (i) by notice to the Borrower terminate the Commitments and
they shall immediately terminate; (ii) by notice to the Borrower declare the
Loans then outstanding to be forthwith due and payable (in whole or, in the sole
discretion of the Required Lenders, from time to time in part), whereupon the
principal of the Loans so declared to be due and payable, together with accrued
interest thereon and any unpaid accrued Fees and all other liabilities of the
Borrower accrued hereunder or under any other Loan Document, shall thereupon
become immediately due and payable, without presentment, demand, protest or any
other notice of any kind, all of which are hereby expressly waived by the
Borrower, anything contained herein or in any other Loan Document to the
contrary notwithstanding; (iii) require the Borrower to deposit cash collateral
with the Trustee pursuant to the Trust Agreement in an amount not exceeding the
Letter of Credit Exposure; (iv) exercise any remedies available under the
Guarantee Agreements, the Collateral Documents or otherwise; or (v) any
combination of the foregoing; provided that in the case of any of the Events of
Default with respect to the Borrower described in paragraph (g) or (h) above,
the Commitments shall automatically terminate and the principal of the Loans
then outstanding, together with accrued interest thereon and any unpaid accrued
Fees and all other liabilities of the Borrower accrued hereunder or under any
other Loan Document, shall automatically become due and payable, without
presentment, demand, protest or any other notice of any kind, all of which are
hereby expressly waived by the Borrower, anything contained herein or in any
other Loan Document to the contrary notwithstanding.
Section 7.02 Remedies. In case any one or more Events of Default or
Defaults shall occur and be continuing, (i) any Lender may proceed to protect
and enforce the rights of such Lender by an action at law, suit in equity or
other appropriate proceeding, whether for the
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specific performance of any agreement contained herein or in any other Loan
Document, or for an injunction against a violation of any of the terms hereof or
thereof, or in aid of the exercise of any power granted hereby or thereby or by
law or otherwise, and (ii) the Trustee and the Lenders may exercise any rights
or remedies in their respective capacities under the Collateral Documents in
accordance with the provisions thereof. In case of a default in the payment or
performance of any provision hereof or of the Loan Documents, the Borrower will
pay to each Lender such further amount as shall be sufficient to cover the cost
and expenses of collection, including reasonable attorneys' fees, expenses and
disbursements, and any out-of-pocket costs and expenses of any such holder
incurred in connection with analyzing, evaluating, protecting, ascertaining,
defending or enforcing any of its rights as set forth herein or in any of the
Loan Documents. No course of dealing and no delay on the part of any Lender in
exercising any right, power or remedy shall operate as a waiver thereof or
otherwise prejudice such Lender's rights, powers or remedies. No right, power or
remedy conferred by this Agreement or by any other Loan Document upon any Lender
shall be exclusive of any other right, power or remedy referred to herein or
therein or now or hereafter available at law, in equity, by statute or
otherwise.
ARTICLE VIII
THE AGENTS AND ISSUING BANK
Section 8.01 Appointment and Authorization. (a) Each of the Lenders,
and each subsequent holder of any Note by its acceptance thereof, hereby
irrevocably appoints and authorizes each of the Agents and the Issuing Bank to
take such actions as agent on behalf of such Lender or holder and to exercise
such powers as are specifically delegated to such Agent or the Issuing Bank, as
the case may be, by the terms and provisions hereof and of the other Loan
Documents, together with such actions and powers as are reasonably incidental
thereto.
(b) The Administrative Agent is hereby expressly authorized by the
Lenders to, without hereby limiting any implied authority, and hereby agrees (in
the case of clause (ii) below, at the direction of the Required Lenders) to, (i)
receive on behalf of the Lenders all payments of principal of and interest on
the Loans and all other amounts due to the Lenders hereunder, and promptly to
distribute to each Lender its proper share of each payment so received; (ii)
give notice on behalf of each of the Lenders to the Borrower of any Event of
Default specified in this Agreement of which the Administrative Agent has actual
knowledge acquired in connection with its agency hereunder; and (iii) distribute
to each Lender copies of all notices, financial statements and other materials
delivered by the Borrower or any Subsidiary pursuant to this Agreement or any
other Loan Document as received by the Administrative Agent (other than
materials required hereunder to be delivered by the Borrower directly to the
Lenders).
Section 8.02 Liability of Agents. Neither the Agents, the Issuing Bank,
nor any of their respective directors, officers, employees or agents, shall be
liable as such for any action taken or omitted to be taken by any of them,
except for such party's own gross negligence or wilful misconduct, or be
responsible for any statement, warranty or representation herein or the contents
of any document delivered in connection herewith, or be required to ascertain or
to make any inquiry concerning the performance or observance by the Borrower or
any Subsidiary
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of any of the terms, conditions, covenants or agreements contained in any Loan
Document. Neither the Agents nor the Issuing Bank shall be responsible to the
Lenders or the holders of the Notes for the due execution, genuineness,
validity, enforceability or effectiveness of this Agreement, the Notes or any
other Loan Documents or other instruments or agreements. The Administrative
Agent may deem and treat the payee of any Note as the owner thereof for all
purposes hereof until it shall have received from the payee of such Note notice,
given as provided herein, of the transfer thereof in compliance with Section
9.04. Each of the Agents and the Issuing Bank shall in all cases be fully
protected in acting, or refraining from acting, in accordance with written
instructions signed by the Required Lenders and, except as otherwise
specifically provided herein, such instructions and any action or inaction
pursuant thereto shall be binding on all the Lenders and each subsequent holder
of any Note. Each of the Agents, the Issuing Bank and the Required Lenders
shall, in the absence of knowledge to the contrary, be entitled to rely on any
instrument or document believed by it in good faith to be genuine and correct
and to have been signed or sent by the proper Person or Persons. Neither the
Agents, the Issuing Bank nor any of their respective directors, officers,
employees or agents, shall have any responsibility to the Borrower on account of
the failure of or delay in performance or breach by any Lender of any of its
obligations hereunder or to any Lender on account of the failure of or delay in
performance or breach by any other Lender or the Borrower or any Subsidiary of
any of their respective obligations hereunder or under any other Loan Document
or in connection herewith or therewith. Each of the Agents and the Issuing Bank
may execute any and all duties hereunder by or through agents or employees,
shall be entitled to consult with legal counsel, independent public accountants
and other experts selected by it with respect to all matters arising hereunder
and shall not be liable for any action taken or omitted to be taken in good
faith by it in accordance with the advice of such counsel, accountants or
experts. None of Lenders identified in this Agreement as a "Documentation Agent"
shall have any obligation, liability, responsibility or duty under this
Agreement in such capacity other than those applicable to all Lenders as such.
Without limiting the foregoing, none of Lenders so identified as "Documentation
Agent" shall have or be deemed to have any fiduciary relationship with any
Lender. Each Lender acknowledges that is has not relied, and will not rely, on
any of Lenders so identified in deciding to enter into this Agreement or in
taking or not taking action hereunder.
Section 8.03 Action by Agents. The Lenders hereby acknowledge that none
of the Agents and the Issuing Bank shall be under any duty to take any
discretionary action permitted to be taken by it pursuant to the provisions of
this Agreement unless it shall be requested in writing to do so by the Required
Lenders. The obligations of the Agents and the Issuing Bank under the Loan
Documents are only those expressly set forth herein and therein. Without
limiting the generality of the foregoing, no Agent shall be required to take any
action with respect to any Default or Event of Default, except as expressly
required pursuant to Article VII.
Section 8.04 Successor Agents. Subject to the appointment and
acceptance of a successor as provided below, each of the Agents and the Issuing
Bank (except, in the case of the Issuing Bank, in respect of Letters of Credit
issued by it) may resign at any time by notifying the Lenders and the Borrower.
Upon any such resignation, the Required Lenders shall have the right to appoint
a successor. If no successor shall have been so appointed by the Required
Lenders, and shall have accepted such appointment, within 30 days after the
retiring Agent or Issuing Bank, as the case may be, gives notice of its
resignation, then the retiring Agent or Issuing Bank,
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as the case may be, may, on behalf of the Lenders, appoint a successor, which
shall be a commercial bank organized or licensed under the laws of the United
States of America or of any State thereof and having a combined capital and
surplus of at least $500,000,000 or an Affiliate of any such bank. Upon the
acceptance of any appointment as an Agent or Issuing Bank, as the case may be,
hereunder by a successor bank, such successor shall succeed to and become vested
with all the rights, powers, privileges and duties of the retiring Agent or
Issuing Bank and the retiring Agent or Issuing Bank shall be discharged from its
duties and obligations hereunder. After the resignation of an Agent or the
Issuing Bank, as the case may be, hereunder, the provisions of this Article and
Section 9.05 shall continue in effect for its benefit in respect of any actions
taken or omitted to be taken by it while it was acting as an Agent or Issuing
Bank.
Section 8.05 Agent and Affiliate. With respect to the Loans made by it
hereunder, the Letters of Credit issued by it hereunder and the Notes issued to
it, each of the Agents and the Issuing Bank in its individual capacity and not
as an Agent or the Issuing Bank shall have the same rights and powers as any
other Lender and may exercise the same as though it were not an Agent or the
Issuing Bank. Each of the Agents and the Issuing Bank (and its Affiliates) may
accept deposits from, lend money to and generally engage in any kind of business
and transactions with the Borrower or any Subsidiary or other Affiliate thereof
as if it were not an Agent or the Issuing Bank (or such Affiliate thereof).
Section 8.06 Indemnification. Each Lender agrees (a) to reimburse each
of the Agents and the Issuing Bank, on demand, in the amount of its pro rata
share (based on its Commitment hereunder) of any expenses incurred for the
benefit of the Lenders by such Agent or the Issuing Bank, as the case may be,
including counsel fees and compensation of agents and employees paid for
services rendered on behalf of the Lenders, which shall not have been reimbursed
by the Borrower and (b) to indemnify and hold harmless each of the Agents, the
Issuing Bank and any of their respective directors, officers, employees or
agents, promptly after demand, in the amount of such pro rata share, from and
against any and all liabilities, taxes, obligations, losses, damages, penalties,
actions, judgments, suits, costs, expenses or disbursements of any kind or
nature whatsoever which may be imposed on, incurred by or asserted against it in
its capacity as an Agent or the Issuing Bank or any of them in any way relating
to or arising out of this Agreement or any other Loan Document or any action
taken or omitted by it or any of them under this Agreement or any other Loan
Document, to the extent the same shall not have been reimbursed by the Borrower;
provided that no Lender shall be liable to any Agent for any portion of such
liabilities, obligations, losses, damages, penalties, actions, judgments, suits,
costs, expenses or disbursements resulting from the gross negligence or willful
misconduct of such Agent, the Issuing Bank or any of their respective directors,
officers, employees or agents.
Section 8.07 Credit Decision. Each Lender acknowledges that it has,
independently and without reliance upon the Agents, the Issuing Bank or any
other Lender and based on such documents and information as it has deemed
appropriate, made its own credit analysis and decision to enter into this
Agreement. Each Lender also acknowledges that it will. independently and without
reliance upon the Agents, the Issuing Bank or any other Lender and based on such
documents and information as it shall from time to time deem appropriate,
continue to make its own decisions in taking or not taking action under or based
upon this
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Agreement or any other Loan Document, any related agreement or any document
furnished hereunder or thereunder.
Section 8.08 Trust Agreement. The Lenders hereby authorize and agree to
be bound by the terms of the Trust Agreement and agree to execute an Agreement
of Parity Lenders hereunder and Supplement to the Intercreditor Agreement.
ARTICLE IX
MISCELLANEOUS
Section 9.01 Notices. Notices and other communications provided for
herein shall be in writing and shall be delivered by hand or overnight courier
service, mailed by certified or registered mail or sent by telecopy as follows:
(a) if to the Borrower, to it at 0000 Xxxxxxxx Xxxxxx, Xxxxxxxx, XX
00000, Attention of Xxxxxxx X. Xxxxxx, Xx. (Telecopy No. (000) 000-0000);
(b) if to the Administrative Agent, to it at Fleet National Bank, 1133
Avenue of the Americas, Mail Code: NY EH 308 39T, Xxx Xxxx, XX 00000, Attention
of Xxxxxx Xxxxx (Telecopy No. (000) 000-0000), with a copy to Fleet National
Bank, 100 Federal Street, Mail Code: XX XX 000000X, Xxxxxx, XX 00000, Attention
of H. Xxxxx Xxxxxx (Telecopy No. (000) 000-0000);
(c) if to the Documentation Agent, to it at Bank of America, N.A., 000
Xxxx Xxxxxx, Xxxxx 0000, Xxxxxxx, Xxxxx 00000-0000, Attention of Xxxxxx Xxx
(Telecopy no. (000) 000-0000), with a copy to McGuireWoods LLP at Bank of
America Corporate Center, 000 Xxxxx Xxxxx Xxxxxx, Xxxxx 0000, Xxxxxxxxx, XX
00000-0000, Attention of Xxx Xxx Xxxxxx (Telecopy No. (000) 000-0000); and
(d) if to a Lender (other than Fleet National Bank and Bank of America,
N.A.), to it at its address on Schedule 1.01A hereto or in the Assignment and
Acceptance pursuant to which such Lender shall have become a party hereto.
All notices and other communications given to any party hereto in accordance
with the provisions of this Agreement shall be deemed to have been given on the
date of receipt if delivered by hand or overnight courier service or sent by
telecopy or on the date five Business Days after dispatch by certified or
registered mail if mailed, in each case delivered, sent or mailed properly
addressed) to such party as provided in this Section 9.01 or in accordance with
the latest unrevoked direction from such party given in accordance with this
Section 9.01.
Section 9.02 Survival of Agreement. All covenants, agreements,
representations and warranties made by the Borrower herein and in the
certificates or other instruments prepared or delivered in connection with or
pursuant to this Agreement or any other Loan Document shall be considered to
have been relied upon by the Lenders, the Agents and the Issuing Bank and shall
survive the making by the Lenders of the Loans, the execution and delivery to
the Lenders of the Notes evidencing such Loans, and the issuance of the Letters
of Credit, regardless of any
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investigation made by the Lenders, the Agents or the Issuing Bank or on their
behalf, and shall continue in full force and effect as long as (a) the principal
of or any accrued interest on any Loan, any Fee, any Letter of Credit
Disbursement or any other amount payable under this Agreement or any other Loan
Document is outstanding and unpaid, (b) the Commitments have not been terminated
or (c) any Letter of Credit has not expired or been terminated.
Section 9.03 Binding Effect. This Agreement shall become effective when
the conditions precedent set forth in Section 4.01 are satisfied (except that,
solely for the purpose of calculating any fees stated herein to commence to
accrue on the date of this Agreement, this Agreement shall become effective when
the conditions precedent set forth in Section 4.01(a) are satisfied).
Section 9.04 Successors and Assigns. (a) Subject to Section 9.04(j),
whenever in this Agreement any of the parties hereto is referred to, such
reference shall be deemed to include the successors and assigns of such party
and all covenants, promises and agreements by or on behalf of the Borrower, the
Agents, the Issuing Bank or the Lenders that are contained in this Agreement
shall be binding upon and inure to the benefit of their respective successors
and assigns.
(b) Each Lender may assign to one or more assignees all or a portion of
its interests, rights and obligations under this Agreement (including all or a
portion of its Commitment, the Loans at the time owing to it, the Notes held by
it and the participations in Letters of Credit held by it); provided, however
that (i) except in the case of an assignment to a Lender or an Affiliate of a
Lender, the assignor shall have obtained the prior written consent to such
assignment (which consent shall not be unreasonably withheld) of the Borrower,
the Agents and, in the case of an assignment of a Revolving Credit Commitment,
the Issuing Bank, (ii) except in the case of an assignment to a Lender or an
Affiliate of a Lender, the sum of (A) the principal amount of the outstanding
Loans subject to each such assignment and (B) the unused amount of the
Commitment of the assigning Lender subject to such assignment (in each case
determined as of the date the Assignment and Acceptance with respect to such
assignment is delivered to the Administrative Agent) shall not be less than the
lesser of (I) $5,000,000 and (II) the entire remaining amount of the outstanding
Loans and unused Commitment of such Lender, (iii) the parties to each such
assignment shall execute and deliver to the Administrative Agent an Assignment
and Acceptance, together with the Note or Notes subject to such assignment and a
processing and recordation fee of $2,500, (iv) the assignee, if it shall not be
a Lender or an Affiliate thereof, shall deliver to the Administrative Agent an
Administrative Questionnaire and (v) the Lenders shall simultaneously assign,
and the assignee shall simultaneously take an assignment of, a pro rata portion
of the sum of the principal amount of the outstanding loans under the Existing
Credit Agreement and the unused amount of the commitment of the assigning lender
under the Existing Credit Agreement and all other interests, rights and
obligations under the Existing Credit Agreement in accordance with the
provisions thereof, such that at all times (A) the Revolving Credit Commitment
Percentage of such Lender hereunder and the Tranche B Revolving Credit
Commitment Percentage (as defined in the Existing Credit Agreement) of such
lender under Facility B shall be the same and (B) the Revolving Credit
Commitment Percentage of such Lender hereunder and the Tranche A Revolving
Credit Commitment Percentage (as defined on the Existing Credit Agreement) of
such lender under Facility A shall be the same.
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Upon acceptance and recording pursuant to Section 9.04(e), from and after the
effective date specified in each Assignment and Acceptance, which effective date
shall be at least five Business Days after the execution thereof (unless the
Administrative Agent shall otherwise agree), (A) the assignee thereunder shall
be a party hereto and, to the extent of the interest assigned by such Assignment
and Acceptance, have the rights and obligations of a Lender under this Agreement
and (B) the assigning Lender thereunder shall, to the extent of the interest
assigned by such Assignment and Acceptance, 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 2.13, 2.15, 2.19 and 9.05,
as well as to any Fees accrued for its account and not yet paid).
(c) By executing and delivering an Assignment and Acceptance, the
assigning Lender thereunder and the assignee thereunder shall be deemed to
confirm to and agree with each other and the other parties hereto as follows:
(i) such assigning Lender warrants that it is the legal and beneficial owner of
the interest being assigned thereby free and clear of any adverse claim; (ii)
except as set forth in clause (i) above, 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, any other Loan Document or any other instrument or document furnished
pursuant hereto or the execution, legality, validity, enforceability,
genuineness, sufficiency or value of this Agreement, any other Loan Document or
any other instrument or document furnished pursuant hereto, or the financial
condition of the Borrower or any other Loan Party or the performance or
observance by the Borrower or any other Loan Party of any of its obligations
under this Agreement, any other Loan Document or any other instrument or
document furnished pursuant hereto; (iii) such assignee represents and warrants
that it is legally authorized to enter into such Assignment and Acceptance; (iv)
such assignee confirms that it has received a copy of the Loan Documents,
together with copies of the most recent financial statements required hereunder
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; (v) such assignee will independently and without reliance upon the
Agents, the Issuing Bank, 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; (vi) such assignee appoints and authorizes each of the Agents
and the Issuing Bank to exercise such powers under this Agreement as are
delegated to such party by the terms hereof, together with such powers as are
reasonably incidental hereto; and (vii) such assignee agrees that it will
perform in accordance with their terms all the obligations which by the terms of
this Agreement are required to be performed by it as a Lender.
(d) The Administrative Agent shall maintain at one of its offices in
Boston, Massachusetts, a copy of each Assignment and Acceptance delivered to it
and a register for the recordation of the names and addresses of the Lenders,
and the Commitments of, and principal amount of the Loans owing to, each Lender
pursuant to the terms hereof from time to time (the "Register"). The entries in
the Register shall be conclusive in the absence of manifest error and the
Borrower, the Agents and the Lenders may treat each Person whose name is
recorded in the Register pursuant to the terms hereof as a Lender hereunder for
all purposes of this Agreement"
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The Register shall be available for inspection by the Borrower, the Issuing Bank
and any Lender, at any reasonable time and from time to time upon reasonable
prior notice.
(e) Upon its receipt of a duly completed Assignment and Acceptance
executed by an assigning Lender and an assignee together with the Note or Notes
subject to such assignment, an Administrative Questionnaire completed in respect
of the assignee (unless the assignee shall already be a Lender hereunder or
shall be an Affiliate of a Lender), the processing and recordation fee referred
to in Section 9.04(b) and, if required, the written consent of the Borrower and
the Issuing Bank to such assignment, and, if required, upon granting its own
consent to such assignment, the Administrative Agent shall (i) accept such
Assignment and Acceptance, (ii) record the information contained therein in the
Register and (iii) give prompt notice thereof to the Issuing Bank, the
Documentation Agent and the Lenders. Within five Business Days after receipt of
notice, the Borrower, at its own expense, shall execute and deliver to the
Administrative Agent, in exchange for the surrendered Note or Notes, a new Note
or Notes payable to the order of such assignee in a principal amount equal to
the applicable portion thereof (and the corresponding Commitment, if any)
assumed by it pursuant to such Assignment and Acceptance and, if the assigning
Lender has retained any portion of such Note or Notes (and such Commitment, if
any), a new Note or Notes payable to the order of such assigning Lender in a
principal amount equal to the applicable portion of such Note or Notes (and such
Commitment, if any) retained by it. Such new Note or Notes shall be in an
aggregate principal amount equal to the aggregate principal amount of such
surrendered Note; such new Note or Notes shall be dated the date of the
surrendered Note or Notes which they replace and shall otherwise be in
substantially the form of Exhibit A. Cancelled Notes shall be returned to the
Borrower.
(f) Each Lender may, without the consent of the Borrower, the Agents or
the Issuing Bank, sell participations in all or a portion of its rights and
obligations under this Agreement (including all or a portion of its Commitment,
the Loans owing to it, the Notes held by it and the participations in Letters of
Credit held by it) to one or more participants: provided, however, that (i) such
Lender's obligations under this Agreement shall remain unchanged, (ii) except in
the case of a participation to an existing participant or its Affiliate, the
outstanding principal amount of the Loans subject to each such participation
shall not be less than the lesser of (A) $5,000,000 and (B) the entire remaining
amount of the outstanding Loans and unused Commitment of such Lender, (iii) such
Lender shall simultaneously grant a participation, and the participant shall
simultaneously take a participation in a pro rata portion of the sum of the
principal amount of the outstanding loans under the Existing Credit Agreement
and the unused amount of the commitments of the lender under the Existing Credit
Agreement (iv) such Lender shall remain solely responsible to the other parties
hereto for the performance of such obligations, (v) the participating banks or
other entities shall be entitled to the benefit of the cost protection
provisions contained in Sections 2.13, 2.15 and 2.19 to the same extent as if
they were Lenders and (vi) the Borrower, the Agents, the Issuing Bank (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 to enforce the obligations of the
Borrower relating to the Loans and to approve any amendment, modification or
waiver of any provision of this Agreement (other than amendments, modifications
or waivers decreasing the principal amount of any Loan, extending the Maturity
Date, the Conversion Date, extending any Repayment Date or any date for the
payment of any interest on any Loan, waiving or excusing
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any such payment or any part thereof, decreasing the rate of interest on any
Loan, changing or extending any Commitment or decreasing any Commitment Fees or
Letter of Credit Fees or postponing the date fixed for any reimbursement of a
Letter of Credit Disbursement, permitting the release of any material amount of
Collateral under any Collateral Document, permitting the release of any material
guarantor from the Guarantee Agreements or increasing the aggregate Commitments
of the Lenders).
(g) Any Lender or participant may, in connection with any assignment or
participation or proposed assignment or participation pursuant to this Section
9.04, disclose to the assignee or participant or proposed assignee or
participant any information relating to the Borrower or any of the other Loan
Parties furnished to such Lender by or on behalf of the Borrower or any of the
other Loan Parties; provided that, prior to any such disclosure of information
designated by the Borrower as confidential, each such assignee or participant or
proposed assignee or participant shall execute an agreement whereby such
assignee or participant shall agree (subject to customary exceptions) to
preserve the confidentiality of such confidential information.
(h) Assignments and participations pursuant to this Section 9.04 need
to be pro rata among the Facility.
(i) Any Lender may at any time assign all or any portion of its rights
under this Agreement and the Notes issued to it to a Federal Reserve Bank;
provided that no such assignment shall release a Lender from any of its
obligations hereunder.
(j) The Borrower shall not assign or delegate any of its rights or
duties hereunder or any interest herein (whether voluntarily, by operation of
law or otherwise). Any purported assignment or delegation in violation of the
foregoing shall be void.
Section 9.05 Expenses; Indemnity. (a) The Borrower agrees to pay
(whether or not the transactions contemplated hereby shall be consummated) all
reasonable out-of-pocket costs and expenses incurred by any Agent or the Issuing
Bank in connection with the preparation, execution and delivery of this
Agreement and the other Loan Documents, the closing of the Facility, the
administration of the Facility or any amendment, modification or waiver of the
provisions hereof or thereof or incurred by any Agent, the Issuing Bank or any
Lender in connection with the enforcement or protection of the rights of the
Agents, the Issuing Bank and the Lenders under this Agreement and the other Loan
Documents or in connection with the Loans made hereunder, the Notes issued
hereunder or the Letters of Credit issued hereunder, including the reasonable
fees, charges and disbursements of (i) McGuireWoods LLP, counsel for the
Administrative Agent and the Documentation Agent, (ii) any third party
consultants retained to assist the Agents in analyzing any environmental,
insurance and other due diligence issues, (iii) any search and filing fees of
ChoicePoint or another company acceptable to the Lenders and (iv) in connection
with any such enforcement or protection, any other counsel for any Agent, the
Issuing Bank or any Lender.
(b) The Borrower agrees to indemnify each of the Agents, the Issuing
Bank, the affiliates of any Agent, the Issuing Bank, the Lenders, and their
respective directors, officers,
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employees, agents and Controlling Persons (each, an "Indemnified Party") from
and against any and all losses, claims (whether valid or not), damages and
liabilities, joint or several, to which such Indemnified Party may become
subject, related to or arising out of (i) the Facility and the transactions
contemplated hereby and thereby, (ii) the execution or delivery of this
Agreement or any other Loan Document or any agreement or instrument contemplated
hereby or thereby, the performance by the parties hereto or thereto of their
respective obligations hereunder or thereunder or the consummation of
transactions contemplated hereby and thereby, (iii) the use of the Letters of
Credit or the proceeds of the Loans or (iv) any claim, litigation, investigation
or proceeding relating to any of the foregoing, whether or not any Indemnified
Party is a party thereto. The Borrower further agrees to reimburse each
Indemnified Party for all expenses (including reasonable attorneys' fees and
expenses) as they are incurred in connection with the investigation of,
preparation for or defense of any pending or threatened claim or any action or
proceeding arising therefrom. Notwithstanding the foregoing, the obligation to
indemnify any Indemnified Party under this Section 9.05(b) shall not apply in
respect of any loss, claim, damage or liability to the extent that a court of
competent jurisdiction shall have determined by final and nonappealable judgment
that such loss, claim, damage or liability resulted from such Indemnified
Party's wilful malfeasance, gross negligence or bad faith.
(c) The Borrower agrees to indemnify each of the Agents, the Issuing
Bank, the Lenders and the other Indemnified Parties from and against any and all
losses, claims (whether valid or not), damages and liabilities, joint or
several, to which such Indemnified Party may become subject, related to or
arising out of (i) any Environmental Laws affecting the Borrower or any other
Loan Party or its properties or assets, (ii) any Hazardous Materials managed by
the Borrower or any other Loan Party, (iii) any event, condition or circumstance
involving environmental pollution, regulation or control affecting the Borrower
or any other Loan Party or its properties or assets or (iv) any claim,
litigation, investigation or proceeding relating to any of the foregoing,
whether or not any Indemnified Party is a party thereto. The Borrower further
agrees to reimburse each Indemnified Party for all expenses (including
reasonable attorneys' fees and expenses) as they are incurred in connection with
the investigation of, preparation for or defense of any pending or threatened
claim or any action or proceeding arising therefrom. Notwithstanding the
foregoing, the obligation to indemnify any Indemnified Party under this Section
9.05(c) shall not apply in respect of any loss, claim, damage or liability to
the extent that a court of competent jurisdiction shall have determined by final
and nonappealable judgment that such loss, claim, damage or liability resulted
from such Indemnified Party's wilful malfeasance, gross negligence or bad faith.
(d) In the event that the foregoing indemnity is unavailable or
insufficient to hold an Indemnified Party harmless, then the Borrower will
contribute to amounts paid or payable by such Indemnified Party in respect of
such Indemnified Party's losses, claims, damages or liabilities in such
proportions as appropriately reflect the relative benefits received by and fault
of the Borrower and such Indemnified Party in connection with the matters as to
which such losses, claims, damages or liabilities relate and other equitable
considerations.
(e) If any action, proceeding or investigation is commenced, as to
which any Indemnified Party proposes to demand such indemnification, it shall
notify the Borrower with reasonable promptness; provided, however, that any
failure by such Indemnified Party to notify
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the Borrower shall not relieve the Borrower from its obligations hereunder
except to the extent the Borrower is prejudiced thereby. The Borrower shall be
entitled to assume the defense of any such action, proceeding or investigation,
including the employment of counsel and the payment of all fees and expenses.
Each Indemnified Party shall have the right to employ separate counsel in
connection with any such action, proceeding or investigation and to participate
in the defense thereof, but the fees and expenses of such counsel shall be paid
by such Indemnified Party, unless (i) the Borrower has failed to assume the
defense and employ counsel as provided herein, (ii) the Borrower has agreed in
writing to pay such fees and expenses of separate counsel or (iii) an action,
proceeding or investigation has been commenced against such Indemnified Party
and the Borrower and representation of both the Borrower and such Indemnified
Party by the same counsel would be inappropriate because of actual or potential
conflicts of interest between the parties (in the case of any Agent or Lender,
the existence of any such actual or potential conflict of interest to be
determined by such party, taking into account, among other things, any relevant
regulatory concerns). In the case of any circumstance described in clause (i),
(ii), or (iii) of the immediately preceding sentence, the Borrower shall be
responsible for the reasonable fees and expenses of such separate counsel;
provided, however, that the Borrower shall not in any event be required to pay
the fees and expenses of more than one separate counsel (plus appropriate local
counsel under the direction of such separate counsel) for all Indemnified
Parties. The Borrower shall be liable only for settlement of any claim against
an Indemnified Party made with the Borrower's written consent.
(f) The provisions of this Section 9.05 shall remain operative and in
full force and effect regardless of the expiration of the term of this
Agreement, the consummation of the transactions contemplated hereby, the
repayment of any of the Loans, the invalidity or unenforceability of any term or
provision of this Agreement or any other Loan Document, or any investigation
made by or on behalf of any Agent or Lender. All amounts due under this Section
9.05 shall be payable on written demand therefor.
Section 9.06 Right of Setoff. If an Event of Default shall have
occurred and be continuing, each Lender is hereby authorized at any time and
from time to time, to the fullest extent permitted by law, to set off and apply
any and all deposits (general or special, time or demand, provisional or final)
at any time held and other indebtedness at any time owing by such Lender to or
for the credit or the account of the Borrower against any of and all the
obligations of the Borrower now or hereafter existing under this Agreement and
the other Loan Documents held by such Lender, irrespective of whether or not
such Lender shall have made any demand under this Agreement or such other Loan
Document and although such obligations may be unmatured. The rights of each
Lender under this Section 9.06 are in addition to other rights and remedies
(including other rights of setoff) which such Lender may have.
Section 9.07 Applicable Law. THIS AGREEMENT AND THE OTHER LOAN
DOCUMENTS SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE LAWS OF THE
STATE OF NEW YORK.
Section 9.08 Waivers; Amendment. (a) No failure or delay of any Agent,
the Issuing Bank or any Lender in exercising any power or right hereunder shall
operate as a waiver thereof, nor shall any single or partial exercise of any
such right or power, or any abandonment or
108
discontinuance of steps to enforce such a right or power, preclude any other or
further exercise thereof or the exercise of any other right or power. The rights
and remedies of the Agents, the Issuing Bank and the Lenders hereunder and under
the other Loan Documents are cumulative and are not exclusive of any rights or
remedies which they would otherwise have. No waiver of any provision of this
Agreement or any other Loan Document or consent to any departure by the Borrower
therefrom shall in any event be effective unless the same shall be permitted by
Section 9.08(b), and then such waiver or consent shall be effective only in the
specific instance and for the purpose for which given. No notice or demand on
the Borrower in any case shall entitle the Borrower to any other or further
notice or demand in similar or other circumstances.
(b) None of this Agreement, the other Loan Documents and any provision
hereof or thereof may be waived, amended or modified, except pursuant to an
agreement or agreements in writing entered into by the Borrower and the Required
Lenders; provided, however, that no such waiver, amendment or modification shall
(i) decrease the principal amount of any Loan, extend the Maturity Date or the
Conversion Date, extend any Repayment Date or any date for the payment of any
interest on any Loan, or waive or excuse any such payment or any part thereof,
or decrease the rate of interest on any Loan, without the prior written consent
of each holder of a Note affected thereby, (ii) change or extend the Commitment
or decrease the Commitment Fees or Letter of Credit Fees of any Lender without
the prior written consent of such Lender, (iii) postpone the date fixed for any
reimbursement of a Letter of Credit Disbursement without the prior written
consent of each Lender affected thereby, (iv) permit the release of any material
amount of Collateral under any Collateral Document or permit the release of any
material guarantor from the Guarantee Agreements without the prior written
consent of each Lender, (v) increase the aggregate Commitments of the Lenders
without the prior written consent of each Lender, (vi) amend or modify the
provisions of 2.11(h), the provisions of Section 2.16, the provisions of
Sections 9.04(b)(v), (h) and (j), or any of the provisions of Article II
relating to the pro rata treatment between this Agreement and the Existing
Credit Agreement, the provisions of this Section 9.08 or the definition of
"Required Lenders" or otherwise change the percentage of the Commitments, the
percentage of the aggregate unpaid principal amount of the Notes or the number
of Lenders which shall be required for the Lenders or any of them to take any
action under any provision of this Agreement or any other Loan Document, without
the prior written consent of each Lender; provided further that no such
agreement shall amend, modify or otherwise affect the rights or duties of any
Agent or the Issuing Bank hereunder without the prior written consent of such
Agent or the Issuing Bank, as applicable. Each Lender and each holder of a Note
shall be bound by any waiver, amendment or modification authorized by this
Section 9.08 regardless of whether its Note shall have been marked to make
reference thereto, and any consent by any Lender or holder of a Note pursuant to
this Section 9.08 shall bind any Person subsequently acquiring a Note from it,
whether or not such Note shall have been so marked.
Section 9.09 Interest Rate Limitation. Notwithstanding anything herein
or in the Notes to the contrary, if at any time the applicable interest rate,
together with all fees and charges which are treated as interest under
applicable law (collectively the "Charges"), as provided for herein or in any
other document executed in connection herewith, or otherwise contracted for,
charged, received, taken or reserved by any Lender, shall exceed the maximum
lawful rate (the "Maximum Rate") which may be contracted for, charged, taken,
received or reserved by such Lender in accordance with applicable law, the rate
of interest payable under the affected Note
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held by such Lender, together with all Charges payable to such Lender, shall be
limited to the Maximum Rate.
Section 9.10 Entire Agreement. This Agreement, the other Loan
Documents, the other Operative Agreements and the Letter Agreement constitute
the entire contract among the parties relative to the subject matter hereof and
thereof. Any agreement previously entered into among the parties with respect to
the subject matter hereof and thereof is superseded by this Agreement, the other
Loan Documents, the other Operative Documents and the Letter Agreement. Nothing
in this Agreement, the other Loan Documents, the other Operative Agreements or
the Letter Agreement, expressed or implied, is intended to confer upon any
party, other than the parties hereto and the other Secured Parties, any rights,
remedies, obligations or liabilities under or by reason of this Agreement, the
other Loan Documents, the other Operative Agreements or the Letter Agreement.
Section 9.11 Severability. In the event any one or more of the
provisions contained in this Agreement or in any other Loan Document should be
held invalid, illegal or unenforceable in any respect, the validity, legality
and enforceability of the remaining provisions contained herein and therein
shall not in any way be affected or impaired thereby. The parties shall endeavor
in good-faith negotiations to replace the invalid, illegal or unenforceable
provisions with valid provisions the economic effect of which comes as close as
possible to that of the invalid, illegal or unenforceable provisions.
Section 9.12 Counterparts. This Agreement may be executed in two or
more counterparts, each of which shall constitute an original but all of which
when taken together shall constitute but one contract, and shall become
effective as provided in Section 9.03.
Section 9.13 Headings. Article and Section headings and the Table of
Contents used herein are for convenience of reference only, are not part of this
Agreement and are not to affect the construction of, or to be taken into
consideration in interpreting, this Agreement.
Section 9.14 Jurisdiction; Consent to Service of Process; Waiver of
Jury Trial. (a) The Borrower hereby irrevocably and unconditionally submits, for
itself and its property, to the nonexclusive jurisdiction of any New York State
court or Federal court of the United States of America sitting in New York, New
York, and any appellate court from any thereof, in any action or proceeding
arising out of or relating to this Agreement or the other Loan Documents, or for
recognition or enforcement of any judgment, and each of the parties hereto
hereby irrevocably and unconditionally agrees that all claims in respect of any
such action or proceeding may be heard and determined in such New York State or,
to the extent permitted by law, in such Federal court. Each of the parties
hereto agrees that a final judgment in any such action or proceeding shall be
conclusive and may be enforced in other jurisdictions by suit on the judgment or
in any other manner provided by law. Nothing in this Agreement shall affect any
right that any Agent, the Issuing Bank or any Lender may otherwise have to bring
any action or proceeding relating to this Agreement or the other Loan Documents
against the Borrower or its properties in the courts of any jurisdiction.
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(b) The Borrower hereby irrevocably and unconditionally waives, to the
fullest extent it may legally and effectively do so, any objection which it may
now or hereafter have to the laying of venue of any suit, action or proceeding
arising out of or relating to this Agreement or the other Loan Documents in any
New York State court or Federal court of the United States of America sitting in
New York, New York. Each of the parties hereto hereby irrevocably waives, to the
fullest extent permitted by law, the defense of an inconvenient forum to the
maintenance of such action or proceeding in any such court.
(c) Each party to this Agreement irrevocably consents to service of
process in the manner provided for notices in Section 9.01. Nothing in this
Agreement will affect the right of any party to this Agreement to serve process
in any other manner permitted by law.
(d) To the fullest extent permitted under applicable law, each of the
Borrower, the Lenders, the Agents and the Issuing Bank hereby irrevocably and
unconditionally waives all right to trial by jury in any action, proceeding or
counterclaim arising out of or related to this Agreement and the other Loan
Documents or any of the transactions contemplated hereby or thereby.
Section 9.15 Legend. THIS AGREEMENT AND THE NOTES ARE SUBJECT TO THE
TERMS AND CONDITIONS CONTAINED IN THE TRUST AGREEMENT WHICH, AMONG OTHER THINGS,
ESTABLISHES CERTAIN RIGHTS WITH RESPECT TO THE SECURITY FOR THIS AGREEMENT AND
THE NOTES AND THE SHARING OF PROCEEDS THEREOF WITH CERTAIN OTHER SECURED
CREDITORS. COPIES OF THE TRUST AGREEMENT WILL BE FURNISHED TO ANY HOLDER OF THE
NOTES UPON REQUEST TO THE BORROWER.
Section 9.16 [Intentionally Omitted].
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IN WITNESS WHEREOF, the Borrower, the Agents, the Issuing Bank and the
Lenders have caused this Agreement to be duly executed by their respective
authorized officers as of the day and year first above written.
STAR GAS PROPANE, L.P., as Borrower
By: STAR GAS LLC,
its general partner
By:
--------------------------------------
Name:
Title:
FLEET NATIONAL BANK,
as Administrative Agent, as Issuing Bank
and as a Lender
By:
----------------------------------------
Name:
Title:
BANK OF AMERICA, N.A.,
as Documentation Agent and as a Lender
By:
----------------------------------------
Name:
Title:
JPMORGAN CHASE BANK,
as a Lender
By:
----------------------------------------
Name:
Title:
CITIZENS BANK OF MASSACHUSETTS,
as a Lender
By:
----------------------------------------
Name:
Title:
