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Amended and Restated
CREDIT AGREEMENT
Among
THE XXXX GROUP, INC.
XXXX CARGO SYSTEMS, INC.
XXXX HAULING AND WAREHOUSING SYSTEM, INC.
XXXXXX MARINE SERVICES, INC.
NPR HOLDING CORPORATION
NPR, INC.
NPR-NAVIERAS RECEIVABLES, INC.
NPR, S.A.
SAN XXXX INTERNATIONAL TERMINALS, INC.
S.J.I.T., INC.
WILMINGTON STEVEDORES, INC.
and
Certain Banking Institutions Named Herein
with
FIRST UNION NATIONAL BANK
As Agent
dated
February 25, 1999
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Table of Contents
1. Certain Definitions.......................................................2
1.1. Definitions........................................................2
1.2. Accounting Terms..................................................11
2. The Credit...............................................................11
2.1. Credit Facilities.............................................11
(a) Revolving Loans...............................................11
(b) Term Loans....................................................12
(c) Letters of Credit.............................................12
2.2. The Notes.........................................................13
(a) Revolving Notes...............................................13
(b) Term Notes....................................................14
2.3. Funding Procedures................................................14
(a) Requests for Advance..........................................14
(b) Irrevocability................................................14
(c) Availability of Funds.........................................15
(d) Funding Assumptions...........................................15
(e) Funding of Net Amount.........................................15
2.4. Interest..........................................................15
(a) Base Rate.....................................................15
(b) LIBO Rate.....................................................15
(c) Renewals and Conversions of Loans.............................16
(d) Automatic Reinstatement.......................................16
2.5. Commitment Fee. .................................................16
2.6. Reduction or Termination of Commitment............................17
(a) Loan Commitment Reduction or Termination......................17
(b) Automatic Loan Commitment Termination.........................17
2.7. Prepayments.......................................................17
(a) Base Rate Loans...............................................18
(b) LIBO Rate Loans. .............................................18
(c) Sale or Loss of Vessel........................................18
(d) Proceeds of Insurance Claims..................................18
(e) Proceeds of Debt or Equity Issuance...........................18
2.8. Payments..........................................................18
(a) Base Rate Loans...............................................18
(b) LIBO Rate Loans...............................................18
(c) Form of Payments, Application of Payments,
Payment Administration, Etc................................18
(d) Net Payments..................................................19
(e) Prepayment of LIBO Rate Loans.................................19
(f) Demand Deposit Account........................................20
2.9. Changes in Circumstances; Yield Protection........................20
2.10. Illegality........................................................21
3. Representations and Warranties...........................................21
3.1. Organization, Standing............................................21
-i-
3.2. Corporate Authority, Validity, Etc................................21
3.3. Litigation........................................................22
3.4. ERISA.............................................................22
3.5. Financial Statements and Projections..............................23
3.6. Not in Default, Judgments, Etc....................................23
3.7. Taxes.............................................................23
3.8. Permits, Licenses, Etc............................................24
3.9. No Materially Adverse Contracts, Etc..............................24
3.10. Compliance with Laws, Etc.........................................24
(a) Compliance Generally........................................24
(b) Hazardous Wastes, Substances and Petroleum Products.........24
3.11. Solvency..........................................................24
3.12. Subsidiaries, Etc.................................................25
3.13. Title to Properties, Leases.......................................25
3.14. Public Utility Holding Company; Investment Company................25
3.15. Margin Stock......................................................25
3.16. Use of Proceeds...................................................25
3.17 Year 2000 Problem.................................................25
3.18. Disclosure Generally..............................................25
4. Conditions Precedent.....................................................26
4.1. All Loans.........................................................26
(a) Documents.....................................................26
(b) Covenants; Representations....................................26
(c) Defaults......................................................26
(d) Material Adverse Change.......................................27
4.2. Conditions to First Loan..........................................27
(a) Articles, Bylaws..............................................27
(b) Evidence of Authorization.....................................27
(c) Legal Opinions................................................27
(d) Incumbency....................................................27
(e) Notes.........................................................27
(f) Collateral Documents..........................................27
(g) Other Documents...............................................27
(h) Consents......................................................28
(i) Fees, Expenses................................................28
(j) Financial Projections.........................................28
5. Affirmative Covenants....................................................28
5.1. Financial Statements and Reports..................................28
(a) Annual Statements.............................................28
(b) Quarterly Statements..........................................29
(c) Compliance Certificate........................................29
(d) ERISA.........................................................29
(e) Material Changes..............................................29
(f) Summary Annual Budget.........................................29
(g) Other Information.............................................29
5.2. Corporate Existence...............................................29
5.3. ERISA.............................................................29
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5.4. Compliance with Regulations.......................................30
5.5. Conduct of Business; Permits and Approvals,
Compliance with Laws...........................................30
5.6. Maintenance of Insurance..........................................30
5.7. Payment of Debt; Payment of Taxes, Etc............................30
5.8. Notice of Events..................................................30
5.9. Inspection Rights.................................................31
5.10. Generally Accepted Accounting Principles..........................31
5.11. Compliance with Material Contracts................................31
5.12. Use of Proceeds...................................................32
5.13. Further Assurances................................................32
5.14. Restrictive Covenants in Other Agreements.........................32
5.15. Year 2000 Program.................................................32
5.16. Subsidiaries......................................................32
6. Negative Covenants.......................................................33
6.1. Consolidation and Merger..........................................33
6.2. Liens.............................................................33
6.3. Guarantees........................................................33
6.4. Margin Stock......................................................33
6.5. Acquisitions and Investments......................................33
6.6. Transfer of Assets; Nature of Business............................34
6.7. Restricted Payments...............................................34
6.8. Accounting Change.................................................34
6.9. Transactions with Affiliates......................................34
6.10. Indebtedness......................................................35
7. Financial Covenants......................................................35
7.1. Minimum Adjusted Net Worth........................................35
7.2. Maximum Adjusted Funded Debt to Adjusted EBITDA...................35
7.3. Minimum Fixed Charge Coverage Ratio...............................36
7.4. Minimum Interest Coverage.........................................36
7.5. Minimum Annualized Adjusted EBITDA................................36
7.6. Term Loan Borrowing Base..........................................37
8. Default..................................................................37
8.1. Events of Default.................................................37
(a) Payments......................................................37
(b) Covenants.....................................................37
(c) Representations, Warranties...................................37
(d) Bankruptcy....................................................37
(e) Certain Other Defaults........................................37
(f) Judgments.....................................................38
(g) Attachments...................................................38
(h) ERISA.........................................................38
(i) Security Interests............................................38
(j) Material Adverse Change.......................................38
(k) Change in Control.............................................38
9. Collateral...............................................................39
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9.1. Collateral........................................................39
9.2. Release of Collateral.............................................39
10. Agent...................................................................40
10.1. Appointment and Authorization....................................40
10.2. Duties and Obligations...........................................40
10.3. First Union as a Bank............................................41
10.4. Independent Credit Decisions.....................................41
10.5. Indemnification..................................................41
10.6. Successor Agent..................................................42
10.7. Allocations Made By First Union..................................42
11. Miscellaneous...........................................................42
11.1. Waiver...........................................................42
11.2. Amendments.......................................................42
11.3. Governing Law....................................................43
11.4. Participations and Assignments...................................43
11.5. Captions.........................................................43
11.6. Notices..........................................................43
11.7. Sharing of Collections, Proceeds and Set-Offs;
Application of Payments.......................................43
11.8. Expenses; Indemnification........................................45
11.9. Survival of Warranties and Certain Agreements....................45
11.10. Severability.....................................................45
11.11. Banks' Obligations Several; Independent
Nature of Banks' Rights.......................................45
11.12. No Fiduciary Relationship........................................46
11.13. CONSENT TO JURISDICTION AND SERVICE OF PROCESS...................46
11.14. ARBITRATION, WAIVER OF JURY TRIAL................................46
11.15. Counterparts; Effectiveness......................................47
11.16. Use of Defined Terms.............................................47
11.17. Offsets..........................................................47
11.18. Entire Agreement.................................................47
11.20. Consolidated Basis...............................................47
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EXHIBIT A-1 REVOLVING LOAN COMMITMENTS AND PERCENTAGES
EXHIBIT A-2 TERM LOAN COMMITMENTS AND PERCENTAGES
EXHIBIT B-1 REVOLVING NOTE
EXHIBIT B-1 TERM NOTE
EXHIBIT C FIRST PREFERRED SHIP MORTGAGE
EXHIBIT D PLEDGE AGREEMENT
EXHIBIT E ACCOUNTS AND GENERAL INTANGIBLES SECURITY AGREEMENT
EXHIBIT F ASSIGNMENT OF INSURANCE PROCEEDS
SCHEDULE 1 DISCLOSURE SCHEDULE
SCHEDULE 2 COLLATERAL SCHEDULE
SCHEDULE 3 APPLICABLE MARGINS, COMMITMENT FEE
-iv-
Credit Agreement
This Credit Agreement, dated February 25, 1999, is entered into by and
among THE XXXX GROUP, INC., a Delaware corporation ("Xxxx Group"), XXXX CARGO
SYSTEMS, INC., a Delaware corporation ("Cargo"), XXXX HAULING AND WAREHOUSING
SYSTEM, INC., a Pennsylvania corporation ("Hauling"), XXXXXX MARINE SERVICES,
INC., a Delaware corporation ("Xxxxxx"), NPR HOLDING CORPORATION, a Delaware
corporation ("NPR Holding"), NPR, INC., a Delaware corporation ("NPR, Inc."),
NPR-NAVIERAS RECEIVABLES, INC., a Delaware corporation ("NPR- Navieras"), NPR
S.A., Inc., a Delaware corporation ("NPR S.A."), SAN XXXX INTERNATIONAL
TERMINALS, INC., a Delaware corporation ("San Xxxx"), S.J.I.T., INC., a Delaware
corporation ("SJIT"), and WILMINGTON STEVEDORES, INC., a Delaware corporation
("Wilmington"), (together, sometimes referred to herein as the "Xxxx Companies"
and individually, as a "Xxxx Company"), the lending institutions signatories
hereto and named in Exhibit A attached hereto and such other institutions that
hereafter become a "Bank" pursuant to ss.10.4 hereof (collectively, the "Banks"
and individually, a "Bank") and First Union National Bank, a national banking
association, as agent for the Banks under this Agreement ("First Union", which
shall mean its capacity as agent unless specifically stated otherwise). This
Agreement amends and restates in its entirety the Credit Agreement, dated
November 17, 1998, among the Xxxx Companies and the Banks with First Union as
agent.
Preliminary Statement
WHEREAS, Xxxx Group is the owner of all of the issued and outstanding
shares of capital stock of Cargo, Hauling, Xxxxxx, NPR Holding, San Xxxx, SJIT
and Wilmington.
WHEREAS, Xxxx Group is the owner of all of the issued and outstanding
shares of capital stock of The Riverfront Development Corporation, a New Jersey
corporation ("Riverfront").
WHEREAS, NPR Holding is the owner of all of the issued and outstanding
shares of capital stock of NPR-Navieras and NPR S.A.
WHEREAS, NPR-Navieras is the owner of all of the issued and outstanding
shares of capital stock of NPR, Inc.
WHEREAS, the Xxxx Companies have been adversely affected by Hurricane
Georges in September 1998, have suffered substantial losses, have made claims
under American International Insurance Company of Puerto Rico Policy No.
026-16761 for payment of certain losses incurred, and require funds to make
repairs and conduct their business pending the resolution and final payment of
said claims under said insurance policy.
WHEREAS, the Xxxx Companies, jointly and severally, have requested, and the
Banks have agreed, that an amended and restated credit facility as herein
described be established for their joint benefit, under the terms and conditions
hereinafter set forth.
NOW, THEREFORE, in consideration of the premises and promises hereinafter
set forth and intending to be legally bound hereby, the parties hereto agree as
follows:
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Credit Agreement February 25, 1999
1. Certain Definitions
1.1 Definitions.
"1995 Credit Agreement" shall mean that certain Loan Agreement, dated July
20, 1995, among Cargo, Hauling, Xxxxxx, Riverfront, Wilmington and various
affiliates, and First Union National Bank, successor by merger to CoreStates
Bank, N.A. (CoreStates Bank, N.A. itself being successor by merger to Meridian
Bank).
"1997 Credit Agreement" shall mean that certain Credit Agreement, dated
November 20, 1997, among the Xxxx Companies, Riverfront and First Union National
Bank, successor by merger to CoreStates Bank, N.A.
"Additional Amount" shall have the meaning set forth in ss.2.8(e).
"Adjusted EBIT" shall mean Adjusted Net Income plus interest expense and
taxes for the period in question.
"Adjusted EBITDA" shall mean Adjusted EBIT plus expenses for depreciation
and amortization for the period in question.
"Adjusted Funded Debt" shall mean (i) Indebtedness for Money Borrowed of
The Xxxx Group, Inc. and its consolidated subsidiaries excluding Indebtedness
for Money Borrowed by Riverfront, and (ii) all liabilities of The Xxxx Group,
Inc. and its consolidated subsidiaries in connection with letter of credit
reimbursement agreements excluding liabilities of Riverfront in connection with
letter of credit reimbursement agreements.
"Adjusted Net Income" shall mean Net Income as defined in accordance with
GAAP with the following adjustments: (i) deduction of the Net Income, if any, of
Riverfront, (ii) addition for Fiscal Year 1998 of the charges incurred in
connection with the Transroll Navieras Express, Inc. ("TNX") joint venture,
(iii) deduction of any net income from Extraordinary Items and (iv) addition of
any net losses from Extraordinary Items.
"Adjusted Net Worth" shall mean Net Worth minus (i) earned surplus/retained
earnings attributable to Riverfront, and (ii) unrealized gains in marketable
securities attributable to investments of Riverfront.
"Affiliate" shall mean any Person: (1) which directly or indirectly
controls, or is controlled by, or is under common control with any Xxxx Company;
(2) which directly or indirectly beneficially owns or holds ten percent (10%) or
more of any class of voting stock of any Xxxx Company; or (3) ten percent (10%)
or more of whose voting stock is directly or indirectly owned or held by any
Xxxx Company. The term "control" means the possession, directly or indirectly,
of the power to direct or cause the direction of the management and policies of
a Person, whether through the ownership of voting securities, by contract, or
otherwise. For purposes hereof, Atlantic Container Line Aktiebolag, a Swedish
corporation, FastShip, Inc., a Delaware corporation, and Emerald Equipment
Leasing, Inc. shall not be deemed affiliates.
"Affiliate Transaction" shall have the meaning set forth in ss.6.9.
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Credit Agreement February 25, 1999
"Agreement" shall mean this Credit Agreement, as amended, supplemented,
modified, replaced, substituted for or restated from time to time and all
exhibits and schedules attached hereto.
"Assignment of Insurance Claims" shall mean the Assignment of Insurance
Claims in the form and substance attached hereto as Exhibit F.
"Base Rate" shall mean, for any day, the higher of the Federal Funds Rate
plus 1/2 of 1% or the prime commercial lending rate of First Union National
Bank, as announced from time to time at its head office, calculated on the basis
of the actual number of days elapsed in a year of 360 days.
"Base Rate Margin" shall have the meaning set forth in Schedule 3 attached
to this Agreement.
"Business Day" shall mean any day other than a Saturday, Sunday, or other
day on which commercial banks in Philadelphia are authorized or required to
close under the laws of the Common-wealth of Pennsylvania.
"Capital Lease" shall mean all lease obligations of any Person for any
property (whether real, personal or mixed) which have been or should be
capitalized on the books of the lessee in accordance with Generally Accepted
Accounting Principles.
"Capitalized Lease Obligations" with respect to any Person, shall mean the
aggregate amount which, in accordance with GAAP, is required to be reported as a
liability on the balance sheet of such Person at such time in respect of such
Person's interest as lessee under a Capital Lease.
"Code" shall mean the Internal Revenue Code of 1986, as amended from time
to time, and all rules and regulations with respect thereto in effect from time
to time.
"Collateral" shall have the meaning set forth in ss.9.1.
"Compliance Certificate" shall mean a certificate with respect to the
compliance by the Xxxx Companies with the provisions of this Agreement and the
other Loan Documents, including calculations with respect to compliance with the
financial covenants set forth in Article 7 hereof. The Compliance Certificate
shall be in the form and substance requested by First Union, as such may be
modified from time to time, and shall be signed by the chief financial officer,
treasurer or controller of The Xxxx Group, Inc.
"CPLTD" shall mean the amounts payable within the next twelve months in
respect of Long Term Debt but shall exclude any amounts payable under this
Agreement. Long Term Debt for purposes of this definition shall mean
Indebtedness for Money Borrowed which was payable over a period of more than
twelve months at the time the Indebtedness for Money Borrowed was incurred.
"Debt" shall mean, as of any date of determination with respect to the Xxxx
Companies, without duplication, (i) all items which in accordance with Generally
Accepted Accounting Principles would be included in determining total
liabilities as shown on the liability side of a consolidated balance sheet of
the Xxxx Companies as of the date on which Debt is to be determined, (ii) all
indebtedness of others with respect to which any Xxxx Company has become liable
by way of a guarantee or endorsement (other than for collection or deposit in
the ordinary course of business), (iii) all liabilities of any Xxxx Company in
connection with letter of credit reimbursement obligations, and
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Credit Agreement February 25, 1999
(iv) lease obligations that, in conformity with GAAP, have been capitalized
on the Xxxx Companies' consolidated balance sheet.
"Default Rate" on any Loan shall mean the higher of 2% per annum above the
Base Rate or 2% per annum above the rate of interest otherwise in effect for
such Loan (whether a Revolving Loan or a Term Loan).
"Dollars" shall mean the lawful currency of the United States of America.
"Environmental Control Statutes" shall mean each and every applicable
federal, state, county or municipal environmental statute, ordinance, rule,
regulation, order, directive or requirement, together with all successor
statutes, ordinances, rules, regulations, orders, directives or requirements, of
any Governmental Authority, including without limitation laws in any way related
to Hazardous Substances.
"ERISA" shall mean the Employee Retirement Income Security Act of 1974, as
it may be amended from time to time.
"ERISA Affiliate" shall mean any corporation which is a member of the same
controlled group of corporations as any Xxxx Company within the meaning of
ss.414(b) of the Code, or any trade or business which is under common control
with any Xxxx Company within the meaning of ss.414(c) of the Code.
"Event of Default" shall have the meaning set forth in ss.8.1.
"Exempt Affiliate Transaction" shall mean (a) customary employee compensation
arrangements approved by a majority of independent (as to such transactions)
members of the board of directors of a Xxxx Company, (b) dividends
expressly permitted under the terms of ss.6.7 hereof and payable, in form and
amount, on a pro rata basis to all holders of common stock of The Xxxx Group,
Inc., and (c) transactions solely between or among the Xxxx Companies.
"Federal Funds Rate" shall mean, for any day, the rate per annum (rounded
upwards, if necessary, to the nearest 1/100 of 1%) equal to the weighted average
of the rates on overnight Federal funds transactions with members of the Federal
Reserve System arranged by Federal funds brokers on such day, as published by
the Federal Reserve Bank of New York on the Business Day next succeeding such
day, provided that if the day for which such rate is to be determined is not a
Business Day, the Federal Funds Rate for such day shall be such rate on such
transactions on the next preceding Business Day as so published on the next
succeeding Business Day.
"First Preferred Ship Mortgage" shall mean the First Preferred Ship Mortgage in
the form and substance attached hereto as Exhibit C.
"Fiscal Quarter" shall mean a fiscal quarter of the Xxxx Companies, which shall
be any quarterly period ending on March 31, June 30, September 30 or December 31
of any year.
"Fiscal Year" shall mean a fiscal year of the Xxxx Companies, which shall end
on the last day of December.
"Fixed Charges" shall mean interest expense plus CPLTD plus Unfunded
Capital Expenditures.
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Credit Agreement February 25, 1999
"Generally Accepted Accounting Principles" or "GAAP" shall mean generally
accepted accounting principles as in effect from time to time in the United
States, consistently applied.
"Governmental Authority" shall mean the federal, state, county or municipal
government, or any department, agency, bureau or other similar type body
obtaining authority therefrom or created pursuant to any laws, including without
limitation Environmental Control Statutes.
"Hazardous Substances" shall mean without limitation, any regulated substance,
toxic substance, hazardous substance, hazardous waste, pollution, pollutant or
contaminant, as defined or referred to in the Resource Conservation and Recovery
Act, as amended, 15 U.S.C., ss.2601 et seq.; the Comprehensive Environmental
Response, Compensation and Liability Act, 33 U.S.C. ss.1251 et seq.; the federal
underground storage tank law, Subtitle I of the Resource Conservation and
Recovery Act, as amended, P.L. 98-616, 42 U.S.C. ss.6901 et seq.; together with
any amendments thereto, regulations promulgated thereunder and all substitutions
thereof, as well as words of similar purport or meaning referred to in any other
federal, state, county or municipal environmental statute, ordinance, rule or
regulation.
"Indebtedness for Borrowed Money" shall mean all indebtedness, liabilities, and
obligations, now existing or hereafter arising, for money borrowed by any Xxxx
Company or any Subsidiary, whether or not evidenced by any note, indenture, or
agreement (including, without limitation, the Note and any indebtedness for
money borrowed from an Affiliate). Indebtedness for Borrowed Money shall not
include amounts payable between any Xxxx Company and any Affiliate where the
obligation arose in connection with the delivery of goods or services in the
ordinary course of business.
"Insurance Claims" shall mean claims made by NPR, Inc. under American
International Insurance Company of Puerto Rico Policy No. 026-16761 in
connection with covered losses for property damage, business interruption and
other losses as a result of direct physical loss or damage to property described
in the policy, subject to certain exclusions, which claims (i) relate to damage
incurred principally as a result of Hurricane Georges in September 1998, (ii)
have not been disallowed, (iii) have not been paid and (iv) if any advances are
made by the insurer, are net of any and all such advances.
"Interest Period" shall mean with respect to any LIBO Rate Loan, each period
commencing on the date any such Loan is made, or, with respect to a Loan being
renewed, the last day of the next preceding Interest Period with respect to a
Loan, and ending on the numerically corresponding day (or, if there is no
numerically corresponding day, on the last day of the calendar month) in the
first, second, third or sixth calendar month thereafter as selected under the
procedures specified in ss. in the case of Revolving Loans or the first calendar
month thereafter in the case of Term Loans, if the Banks are then offering LIBO
Rate Loans for such period; provided that each LIBO Rate Loan Interest Period
which would otherwise end on a day which is not a Business Day (or, for purposes
of Loans to be repaid on a London Business Day, such day is not a London
Business Day) shall end on the next succeeding Business Day (or London Business
Day, as appropriate) unless such next succeeding Business Day (or London
Business Day, as appropriate) falls in the next succeeding calendar month, in
which case the Interest Period shall end on the next preceding Business Day (or
London Business Day, as appropriate).
"Investment" in any Person shall mean without duplication (a) the acquisition
(whether for cash, property, services or securities or otherwise) of capital
stock, bonds, notes, debentures, partnership or other ownership interests or
other securities of such Person; (b) any deposit with, or advance, loan
-5-
Credit Agreement February 25, 1999
or other extension of credit to, such Person (other than any such deposit,
advance, loan or extension of credit having a term not exceeding 180 days in the
case of unaffiliated Persons and 365 days in the case of Affiliates representing
the purchase price of inventory or supplies purchased in the ordinary course of
business) or guarantee or assumption of, or other contingent obligation with
respect to, Indebtedness for Borrowed Money or other liability of such Person;
and (c) (without duplication of the amounts included in (a) and (b)) any amount
that may, pursuant to the terms of such investment, be required to be paid,
deposited, advanced, lent or extended to or guaranteed or assumed on behalf of
such Person.
"Letter of Credit" shall have the meaning set forth in ss.2.1(b).
"LIBO Rate" shall mean, for the applicable Interest Period, (i) the rate,
rounded upwards to the next one-sixteenth of one percent, determined by First
Union three London Business Days prior to the date of the corresponding LIBO
Rate Loan, at which First Union National Bank, individually, is offered deposits
in dollars at approximately 11:00 A.M., London time by leading banks in the
interbank eurodollar or eurocurrency market for delivery on the date of such
Loan in an amount and for a period comparable to the amount and Interest Period
of such Loan and in like funds, divided by (ii) a number equal to one (1.0)
minus the LIBO Rate Reserve Percentage. The LIBO Rate shall be adjusted
automatically with respect to any LIBO Rate Loan outstanding on the effective
date of any change in the LIBO Rate Reserve Percentage, as of such effective
date. LIBO Rate shall be calculated on the basis of the actual number of days
elapsed in a year of 360 days.
"LIBO Rate Loans" shall mean Loans accruing interest based on the LIBO Rate.
"LIBO Rate Margin" shall have the meaning set forth in Schedule 3 attached to
this Agreement.
"LIBO Rate Reserve Percentage" shall mean, for any LIBO Rate Loan for any
Interest Period therefor, the daily average of the stated maximum rate
(expressed as a decimal) at which reserves (including any marginal,
supplemental, or emergency reserves) are required to be maintained during such
Interest Period under Regulation D by the Bank against "Eurocurrency
liabilities" (as such term is used in Regulation D) but without benefit of
credit proration, exemptions, or offsets that might otherwise be available to
the Bank from time to time under Regulation D. Without limiting the effect of
the foregoing, the LIBO Rate Reserve Percentage shall reflect any other reserves
required to be maintained by the Bank against (1) any category of liabilities
which includes deposits by reference to which the rate for LIBO Rate Loans is to
be determined; or (2) any category of extension of credit or other assets which
include LIBO Rate Loans.
"Lien" shall mean any lien, mortgage, security interest, chattel mortgage,
pledge or other encumbrance (statutory or otherwise) of any kind securing
satisfaction of an obligation of any Xxxx Company or any Subsidiary of any Xxxx
Company, including any agreement to give any of the foregoing, any conditional
sales or other title retention agreement, and the filing of or the agreement to
give any financing statement under the Uniform Commercial Code of any
jurisdiction or similar evidence of any encumbrance, whether within or outside
the United States.
"Loan" or "Loans" shall mean the meanings set forth in ss.2.1.
"Loan Documents" shall mean this Agreement, the Notes, any Security Agreement
and all other documents directly related or incidental to said documents, the
Loans or the Collateral.
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Credit Agreement February 25, 1999
"London Business Day" shall mean any Business Day on which banks in London,
England are open for business.
"Material Adverse Change" shall mean any event or condition which (a) is
reasonably likely to result in a material adverse change in the financial
condition, assets, operations or prospects of the Xxxx Companies taken as a
group, or (b) gives reasonable grounds to conclude that any Xxxx Company will
not be able to perform or observe (in the normal course) its obligations under
the Loan Documents to which it is a party, including but not limited to the
Notes.
"Material Adverse Effect" shall mean any event or condition which (a) is
reasonably likely to have a material adverse effect on the financial condition,
assets, operations or prospects of the Xxxx Companies taken as a group, (b)
gives reasonable grounds to conclude that any Xxxx Company will not be able to
perform its obligations under the Loan Documents to which it is a party,
including but not limited to the Notes, or (c) is reasonably likely to affect
legality, validity or enforceability of this Agreement or the Notes or the
rights and remedies of the holder(s) of the Loans.
"Multiemployer Plan" shall mean a multiemployer plan as defined in ERISA
ss.4001(a)(3), which covers employees of any Xxxx Company or any ERISA
Affiliate.
"Net Worth" shall mean Net Worth as defined in accordance with GAAP.
"Note" and "Notes" shall have the meanings set forth in ss.2.2.
"Obligations" shall mean all now existing or hereafter arising debts,
obligations, covenants, and duties of payment or performance of every kind,
matured or unmatured, direct or contingent, owing, arising, due, or payable to
the Banks or First Union, by or from any Xxxx Company arising out of this
Agreement or any other Loan Document, including, without limitation, all
obligations to repay principal of and interest on the Loans, and to pay
interest, fees, costs, charges, expenses, professional fees, and all sums
chargeable to any Xxxx Company or for which any Xxxx Company is liable as
indemnitor under the Loan Documents, whether or not evidenced by any note or
other instrument.
"PBGC" shall mean the Pension Benefit Guaranty Corporation and any successor
thereto.
"Pension Plan" shall mean, at any time, any Plan (including a Multiemployer
Plan), the funding requirements of which (under ERISA ss.302 or Code ss.412)
are, or at any time within the six years immediately preceding the time in
question, were in whole or in part, the responsibility of any Xxxx Company or
any ERISA Affiliate.
"Permitted Liens" shall mean (a) any Liens for current taxes, assessments and
other governmental charges not yet due and payable or being contested in good
faith by any Xxxx Company by appropriate proceedings and for which adequate
reserves have been established by the Xxxx Company as reflected in the Xxxx
Companies' consolidated financial statements; (b) any mechanic's, materialman's,
carrier's, warehousemen's or similar Liens for sums not yet due or being
contested in good faith by any Xxxx Company by appropriate proceedings and for
which adequate reserves have been established by the Xxxx Company as reflected
in the Xxxx Companies' consolidated financial statements; (c) easements,
rights-of-way, restrictions and other similar encumbrances on the real property
or fixtures of any Xxxx Company incurred in the ordinary course of business
which individually or in the aggregate are not substantial in amount and which
do not in any case materially detract from the value or marketability of the
property subject thereto or interfere with the ordinary
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Credit Agreement February 25, 1999
conduct of the business of any Xxxx Company; (d) Liens (other than Liens
imposed on any property of any Xxxx Company pursuant to ERISA or ss.412 of the
Code) incurred or deposits made in the ordinary course of business, including
Liens in connection with workers' compensation, unemployment insurance and other
types of social security and Liens to secure performance of tenders, statutory
obligations, surety and appeal bonds (in the case of appeal bonds such Liens
shall not secure any reimbursement or indemnity obligation in an amount greater
than $250,000), bids, leases that are not Capital Leases, performance bonds (in
the case of performance bonds such Liens shall not secure any reimbursement or
indemnity obligation in an amount greater than $1,000,000 in the aggregate),
sales contracts and other similar obligations, in each case, not incurred in
connection with the obtaining of credit or the payment of a deferred purchase
price, and which do not, in the aggregate, result in a Material Adverse Effect;
(e) Liens, if any, existing on the date hereof and listed in Schedule 1 hereto;
(f) Liens related to any capital lease obligations and/or purchase money
security interests limited to assets so leased, purchased, or financed, the
aggregate unpaid balance of which shall not at any time exceed the sum of (1)
$10,000,000 and (2) the unpaid balance of such items in existence at the date
hereof and set forth in Schedule 1 hereto; (g) Liens in the leasehold interests
of the Xxxx Companies and any of them in any equipment leased from Emerald
Equipment Leasing, Inc. and in the leases themselves; and (h) liens in favor of
First Union, as Agent, in the Collateral contemplated by this Agreement and the
other Loan Documents.
"Person" shall mean any individual, corporation, partnership, joint venture,
association, company, business trust or entity, or other entity of whatever
nature.
"Plan" shall mean an employee benefit plan as defined in ss.3(3) of ERISA,
other than a Multiemployer Plan, whether formal or informal and whether legally
binding or not.
"Pledge Agreement" shall have mean the Pledge Agreement in the form and
substance attached hereto as Exhibit D.
"Potential Default" shall mean an event, condition or circumstance that with
the giving of notice or lapse of time or both would become an Event of Default.
"Prohibited Transaction" shall mean a transaction that is prohibited under Code
ss.4975 or ERISA ss.406 and not exempt under Code ss.4975 or ERISA ss.408.
"Regulation" shall mean any statute, law, ordinance, regulation, order or rule
of any United States or foreign, federal, state, local or other government or
governmental body, including, without limitation, those covering or related to
banking, financial transactions, securities, public utilities, environmental
control, energy, safety, health, transportation, bribery, record keeping,
zoning, antidiscrimination, antitrust, wages and hours, employee benefits, and
price and wage control matters.
"Regulation D" shall mean Regulation D of the Board of Governors of the Federal
Reserve System, as it may be amended from time to time.
"Regulatory Change" shall mean any change after the date of this Agreement in
any Regulation (including Regulation D) or the adoption or making after such
date of any interpretations, directives or requests of or under any Regulation
(whether or not having the force of law) by any court or
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Credit Agreement February 25, 1999
governmental or monetary authority charged with the interpretation or
administration thereof applying to a class of banks including any one of the
Banks but excluding any foreign office of any Bank.
"Release" shall mean without limitation, the presence, leaking, leaching,
pouring, emptying, discharging, spilling, using, generating, manufacturing,
refining, transporting, treating, or storing of Hazardous Substances at, into,
onto, from or about the property or the threat thereof, regardless of whether
the result of an intentional or unintentional action or omission, and which is
in violation of any applicable law, including Environmental Control Statutes.
"Reportable Event" shall mean, with respect to a Pension Plan: (a) any of the
events set forth in ERISA Sections 4043(b) (other than a reportable event as to
which the provision of 30 days' notice to the PBGC is waived under applicable
regulations) or 4063(a) or the regulations thereunder, (b) an event requiring
any Xxxx Company or any ERISA Affiliate to provide security to a Pension Plan
under Code ss.401(a)(29) and (c) any failure by any Xxxx Company or any ERISA
Affiliate to make payments required by Code ss.412(m).
"Request for Advance" shall have the meaning set forth in ss.2.3.
"Required Banks" at any time shall mean Banks whose Revolving Loan Commitments
and Term Loan Commitments equal or exceed 66 2/3% of the Aggregate Revolving
Loan Commitment and Aggregate Term Loan Commitment taken together, if no Loans
are outstanding or, if Loans are outstanding, Banks whose outstanding Loans
equal or exceed 66 2/3% of the Loans (Revolving Loans and Term Loans).
"Revolving Credit Termination Date" shall have the meaning set forth in ss.2.2.
"Revolving Loan" or "Revolving Loans" shall mean the meanings set forth in
ss.2.1.
"Revolving Loan Commitment" shall have the meaning set forth in ss.2.1.
"Revolving Loan Commitment Fee" shall have the meaning set forth in ss.2.5.
"Revolving Note" and "Revolving Notes" shall have the meanings set forth in
ss.2.2.
"Security Agreement" shall mean the Accounts and General Intangibles Security
Agreement in the form and substance attached hereto as Exhibit E.
"Solvent" shall mean, with respect to any Person, that the aggregate present
fair saleable value of such Person's assets is in excess of the total amount of
its probable liabilities on its existing debts as they become absolute and
matured, such Person has not incurred debts beyond its foreseeable ability to
pay such debts as they mature, and such Person has capital adequate to conduct
the business it is presently engaged in or is about to engage in.
"Subsidiary" shall mean a corporation or other entity the shares of stock or
other equity interests of which having ordinary voting power (other than stock
or other equity interests having such power only by reason of the happening of a
contingency) to elect a majority of the board of directors or
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Credit Agreement February 25, 1999
other managers of such corporation are at the time owned, or the management of
which is otherwise controlled, directly or indirectly through one or more
intermediaries or both, by any Xxxx Company. Emerald Equipment Leasing, Inc.
shall not be deemed a subsidiary.
"Taxes" shall have the meaning set forth in ss.2.8.(d).
"Term Credit Termination Date" shall have the meaning set forth in ss.2.2.
"Term Loan" or "Term Loans" shall mean the meanings set forth in ss.2.1.
"Term Loan Borrowing Base" shall mean 50% of the unpaid Insurance Claims.
"Term Loan Commitment" shall have the meaning set forth in ss.2.1.
"Term Loan Commitment Fee" shall have the meaning set forth in ss.2.5.
"Term Note" and "Term Notes" shall have the meanings set forth in ss.2.2.
"Termination Event" shall mean, with respect to a Pension Plan: (a) a
Reportable Event, (b) the termination of a Pension Plan, or the filing of a
notice of intent to terminate a Pension Plan, or the treatment of a Pension Plan
amendment as a termination under ERISA ss.4041(c), (c) the institution of
proceedings to terminate a Pension Plan under ERISA ss.4042 or (d) the
appointment of a trustee to administer any Pension Plan under ERISA ss.4042.
"Unfunded Capital Expenditures" shall mean capital expenditures other than
capital expenditures financed as contemplated in ss.6.10(iii).
"Unfunded Pension Liabilities" shall mean, with respect to any Pension Plan at
any time, the amount, if any, determined by taking the accumulated benefit
obligation, as disclosed in accordance with Statement of Accounting Standards
No. 87, and deducting the fair market value of Pension Plan assets.
"Unrecognized Retiree Welfare Liability" shall mean, with respect to any Plan
that provides post-retirement benefits other than pension benefits, the amount
of the accumulated post-retirement benefit obligation, as determined in
accordance with Statement of Financial Accounting Standards No. 106, as of the
most recent valuation date. Prior to the date such statement is applicable to
any Xxxx Company, such amount of the obligation shall be based on an estimate
made in good faith.
"Vessel" shall mean the assets listed and described in Schedule 2 attached
herein which are subject to First Preferred Ship Mortgages in favor of First
Union National Bank, as Agent, to secure repayment of Loans and Letters of
Credit made and outstanding hereunder.
"Year 2000 Problem" shall mean the risk that the Xxxx Companies' computer
applications or systems or other technologies, or those of the key vendors,
suppliers or customers of either of them, may be unable to accurately process,
calculate, compare, and sequence date or time data from, into, or between the
20th and 21st centuries, or the years 1999 and 2000, or with regard to leap year
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Credit Agreement February 25, 1999
calculations, or otherwise function properly and unimpaired with respect to all
calendar dates falling on or after January 1, 2000.
1.2. Accounting Terms. All accounting terms not specifically defined herein
shall be construed in accordance with Generally Accepted Accounting
Principles consistent with those applied in the preparation of the financial
statements referred to in ss.3.5, and all financial data submitted pursuant to
this Agreement shall be prepared in accordance with such principles.
2. The Credit
2.1. Credit Facilities.
(a) Revolving Loans. Subject to the terms and conditions herein set
forth, each Bank agrees, severally and not jointly, to make revolving loans
(herein called individually a "Revolving Loan" and collectively, the
"Revolving Loans", and together with the Term Loans, a "Loan" and
collectively, the "Loans") to the Xxxx Companies during the period beginning
on the date hereof and ending on the Revolving Credit Termination Date in
amounts not to exceed at any time outstanding (together with each Bank's
share of all Letters of Credit outstanding) the commitment amount set forth
opposite the name of such Bank on Exhibit A-1 hereto (each such amount, as
the same may be reduced pursuant to ss.2.6 or ss.2.10 being hereinafter
called such Bank's "Revolving Loan Commitment"). The Banks' collective
commitment to make Revolving Loans shall be the "Aggregate Revolving Loan
Commitment"). The maturity date of each Revolving Note, as provided in ss.2.2
below, shall be the Revolving Credit Termination Date. All Revolving Loans
shall be made by the Banks simultaneously and pro rata in accordance with
their respective Revolving Loan Commitments. All Revolving Loans shall be
made to the Xxxx Companies at the primary office of First Union in
Philadelphia located at Broad and Xxxxxxxx Xxxxxxx, Xxxxxxxxxxxx,
Xxxxxxxxxxxx 00000.
Notwithstanding the foregoing, the Xxxx Companies shall not be entitled
to any Revolving Loan if, after giving effect to such Revolving Loan, the
aggregate unpaid amount of all Revolving Loans, when added to the aggregate
amount of Letters of Credit outstanding as provided below, would exceed the
Aggregate Revolving Loan Commitment. Within the limit of the Aggregate
Revolving Loan Commitment, the Xxxx Companies may borrow, prepay and
reborrow. Each Revolving Loan shall be in the minimum principal amount of
$1,000,000.
(b) Term Loans. Subject to the terms and conditions herein set forth,
each Bank agrees, severally and not jointly, to make term loans (herein
called individually a "Term Loan" and collectively, the "Term Loans", and
together with the Revolving Loans, a "Loan" and collectively, the "Loans") to
the Xxxx Companies during the period beginning on the date hereof and ending
on the Term Credit Termination Date in amounts not to exceed at any time
outstanding the commitment amount set forth opposite the name of such Bank on
Exhibit A-2 hereto (each such amount, as the same may be reduced pursuant to
ss.2.6 or ss.2.10 being hereinafter called such Bank's "Term Loan
Commitment"). The Banks' collective commitment to make Term Loans shall be
the "Aggregate Term Loan Commitment"). The maturity date of each Term Note,
as provided in ss.2.2 below, shall be the Term Credit Termination Date. All
Term Loans shall be made by the Banks simultaneously and pro rata in
accordance with their respective Term Loan Commitments. All Term Loans shall
be made to the Xxxx Companies at the primary office of First Union in
Philadelphia located at Broad and Xxxxxxxx Xxxxxxx, Xxxxxxxxxxxx,
Xxxxxxxxxxxx 00000.
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Credit Agreement February 25, 1999
Notwithstanding the foregoing, the Xxxx Companies shall not be entitled
to any Term Loan if, after giving effect to such Term Loan, the aggregate
unpaid amount of all Term Loans would exceed the Aggregate Term Loan
Commitment. Prepayments and repayments of Term Loans shall automatically
reduce the Aggregate Term Loan Commitment and proportionally, the Term Loan
Commitment of each Bank. Amounts prepaid or paid may not be reborrowed. Each
Term Loan shall be in the minimum principal amount of $1,000,000.
(c) Letters of Credit. First Union, under the terms and subject to the
conditions of this Agreement, on behalf of itself and each other Bank in the
same proportions as each Bank's Revolving Loan Commitment bears to the
Aggregate Revolving Loan Commitment, shall provide letters of credit at the
request and for the account of the Xxxx Companies, from time to time prior to
the Revolving Credit Termination Date, as requested by the Xxxx Companies,
provided that:
(i) the aggregate amount of Letters of Credit outstanding at any one
time shall not exceed ten million dollars ($10,000,000), at any time hereafter,
or such lesser amount, if any, as will, when added to the amount of all
Revolving Loans then outstanding, aggregate the then existing Revolving
Aggregate Loan Commitment;
(ii) no Letter of Credit shall be issued after the Revolving Credit
Termination Date and no Letter of Credit shall be for a term longer than one
year; and
(iii) Letters of Credit shall be issued primarily to support
insurance premium requirements of any one or more of the Xxxx Companies.
As used in this Agreement, "Letter of Credit" shall mean only those
letters of credit issued pursuant to a completed application on the form of
letter of credit application required by First Union at the time of the
request for each Letter of Credit. If and to the extent that any provision of
any letter of credit application required by First Union shall be
inconsistent with or otherwise be in conflict with this Agreement, this
Agreement shall govern.
Letters of Credit issued and currently outstanding in the aggregate
amount of $6,325,000 pursuant to the 1995 Credit Agreement and the 1997
Credit Agreement shall be deemed to be Letters of Credit for purposes of this
Agreement for so long as they shall continue in effect and shall be included
in the calculation of Letters of Credit outstanding hereunder.
The Xxxx Companies shall request a Letter of Credit by delivering a
completed letter of credit application to First Union not less than one
Business Day prior to the date specified by the Xxxx Companies as the date
the Letter of Credit is to be issued.
Letters of Credit shall not bear interest until drawn upon. Letters of
Credit for commercial purposes shall each be subject to a fee payable to
First Union National Bank, for its own account, said fee to be based on its
issuance charges as in effect from time to time. Letters of Credit which are
standby in nature shall each be subject to an annual charge, payable
quarterly in arrears from the date of issuance, equal to (a) 200 basis points
(2.00%) times the aggregate amount of all standby Letters of Credit
outstanding which shall be shared among the Banks pro rata in the same
proportions that each Bank's Loan Commitment bears to the Aggregate Loan
Commitment, and (b) 12.5 basis points (1/8 of 1%) times the face amount of
each standby Letter of Credit outstanding which shall be payable to the
issuing Bank.
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Credit Agreement February 25, 1999
Within the foregoing limit, the Xxxx Companies may request issuance of
Letters of Credit, reimburse First Union upon a drawing thereunder and
request new issuances. If any obligation of the Xxxx Companies to pay money
in connection with any Letter of Credit is not met when requested by First
Union, as permitted by the applicable letter of credit application and the
reimbursement agreement contained therein, the amount due shall be funded
automatically by a Revolving Loan which Revolving Loan shall be made without
regard to any minimum borrowing requirement, condition precedent herein, or
Event of Default hereunder which would otherwise entitle any Bank or the
Banks not to provide such Revolving Loan, and each Bank shall make its
proportionate share of such Revolving Loan. Any obligation of the Xxxx
Companies to pay money in connection with any Letter of Credit shall be
secured as if made as a Revolving Loan hereunder. In the event the Xxxx
Companies shall terminate the Aggregate Revolving Loan Commitment as provided
in ss.2.6 and shall pay the outstanding principal amount of all Revolving
Loans in full and with interest or the Revolving Credit Termination Date
shall occur at a time when one or more Letters of Credit remain outstanding,
then the Xxxx Companies shall furnish to First Union, within three Business
Days such amount of cash, to be held as cash collateral and invested in
certificates of deposit of First Union National Bank, as will pay the maximum
amount which may be drawn by beneficiaries of Letters of Credit outstanding
at the date of such termination or Revolving Credit Termination Date, as
applicable.
2.2. The Notes.
(a) Revolving Notes. The Revolving Loans made by each Bank shall be
evidenced by a single promissory note of the Xxxx Companies under which they
shall be jointly and severally liable (each such promissory note as it may be
amended, extended, modified, restated, replaced, substituted for or renewed,
being referred to herein as a "Revolving Note" and all Revolving Notes
together as the "Revolving Notes", and together with the Term Notes as a
"Note" and together with all Term Notes as the "Notes") in principal face
amount equal to such Bank's Revolving Loan Commitment payable to the order of
such Bank and otherwise in the form attached hereto as Exhibit B-1. Each
Revolving Note shall be dated its date of issuance, shall bear interest at
the rate per annum and be payable as to principal and interest in accordance
with the terms hereof. Each Revolving Note shall mature on the earliest to
occur of (i) the date the maturity of the Notes are accelerated as provided
in ss.8.1 hereof, or (ii) November 17, 2001 (this date to be deemed the
"Revolving Credit Termination Date"). Upon maturity, the Revolving Loans
evidenced by each Bank's Revolving Note shall be due and payable. Each Bank
shall maintain records of all Revolving Loans by it and evidenced by its
Revolving Note and of all payments thereon, which records shall be conclusive
absent manifest error.
(b) Term Notes. The Term Loans made by each Bank shall be evidenced by a
single promissory note of the Xxxx Companies under which they shall be
jointly and severally liable (each such promissory note as it may be amended,
extended, modified, restated, replaced, substituted for or renewed, being
referred to herein as a "Term Note" and all Term Notes together as the "Term
Notes", and together with the Revolving Notes as a "Note" and together with
all Term Notes as the "Notes") in principal face amount equal to such Bank's
Term Loan Commitment payable to the order of such Bank and otherwise in the
form attached hereto as Exhibit B-2. Each Term Note shall be dated its date
of issuance, shall bear interest at the rate per annum and be payable as to
principal and interest in accordance with the terms hereof. Each Term Note
shall mature on the earliest to occur of (i) the date the maturity of the
Notes are accelerated as provided in ss.8.1 hereof, or (ii) December 31, 1999
(this date to be deemed the "Term Credit Termination Date"). Upon maturity,
the Term Loans evidenced by each Bank's Term Note shall be due and payable.
Each Bank shall maintain
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Credit Agreement February 25, 1999
records of all Term Loans by it and evidenced by its Term Note and of
all payments thereon, which records shall be conclusive absent manifest
error.
2.3. Funding Procedures.
(a) Requests for Advance. Each request for a Loan or the conversion or
renewal of an interest rate with respect to a Loan shall be made not later
than 11:00 a.m. on a Business Day by delivery to First Union of a written
request signed by the Xxxx Companies or, in the alternative, a telephone
request followed promptly by written confirmation of the request (a "Request
for Advance"), specifying the date and amount of the Loan to be made,
converted or renewed, specifying whether the Loan is to be a Revolving Loan
or Term Loan, selecting the interest rate option applicable thereto, and in
the case of a LIBO Rate Loan, specifying the Interest Period applicable to
such Loan if it is a Revolving Loan. The form of request to be used in
connection with the making, conversion or renewal of Loans shall be that form
provided to the Xxxx Companies by First Union. Each request shall be received
not less than one Business Day prior to the date of the proposed borrowing,
conversion or renewal in the case of Base Rate Loans and three London
Business Days prior to the date of the proposed borrowing, conversion or
renewal in the case of LIBO Rate Loans. No request shall be effective until
actually received in writing by First Union, as Agent. Any request may be
made by submission of such request by facsimile transmission with the signed
original being promptly transmitted to First Union. First Union shall be
entitled to rely on a facsimile of the signed original as fully as it had
received the signed original.
(b) Irrevocability. Upon receipt of a request for a Loan and if the
conditions precedent provided herein shall be satisfied at the time such
request, First Union promptly shall notify each Bank of such request and of
such Bank's ratable share of such Loan. Upon receipt of a request for a Loan
by First Union, the request shall not be revocable by the Xxxx Companies.
(c) Availability of Funds. Not later than 1:00 p.m. EST on the date of
each Loan, each Bank shall make available (except as provided in clause (d)
below) its ratable share of such Loan, in immediately available funds, to
First Union at the address set forth opposite its name on the signature page
hereof or at such account in London as First Union shall specify to the Xxxx
Companies and the Banks. Unless First Union knows that any applicable
condition specified herein has not been satisfied, it will make funds so
received from the Banks immediately available to the Xxxx Companies on the
date of each Loan by a credit to the account designated by the Xxxx Companies
at First Union's address set forth opposite its name on the signature page
hereof or at such other destination and in such other form as the Xxxx
Companies may request, in writing.
(d) Funding Assumptions. Unless First Union shall have been notified by
any Bank at least one Business Day prior to the date of the making,
conversion or renewal of any LIBO Rate Loan, or by 11:00 a.m. EST on the date
a Base Rate Loan is requested, that such Bank does not intend to make
available to First Union, such Bank's portion of the total amount of the Loan
to be made, converted or renewed on such date, First Union may assume that
such Bank has made such amount available to First Union on the date of the
Loan and First Union may, in reliance upon such assumption, make available to
the Xxxx Companies a corresponding amount. If and to the extent such Bank
shall not have so made such funds available to First Union, such Bank agrees
to repay First Union forthwith on demand such corresponding amount together
with interest thereon, for each day from the date such amount is made
available to the Xxxx Companies until the date such amount is repaid to First
Union, at the Federal Funds Rate plus 50 basis points for three Business
Days, and thereafter at the Base Rate. If such Bank shall repay to First
Union such corresponding amount,
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Credit Agreement February 25, 1999
such amounts so repaid shall constitute such Bank's Revolving or Term
Loan, as applicable, for purposes of this Agreement. If such Bank does not
repay such corresponding amount forthwith upon First Union's demand therefor,
First Union shall promptly notify the Xxxx Companies, and the Xxxx Companies
shall immediately pay such corresponding amount to First Union, without any
prepayment penalty or premium, but with interest on the amount repaid, for
each day from the date such amount is made available to the Xxxx Companies
until the date such amount is repaid to First Union, at the rate of interest
applicable at the time to such Loan. Nothing herein shall be deemed to
relieve any Bank of its obligation to fulfill its Revolving or Term Loan
Commitment, as applicable, hereunder or to prejudice any rights which the
Xxxx Companies may have against any Bank as a result of any default by such
Bank hereunder.
(e) Funding of Net Amount. If the Banks make a Loan on a day on which
all or any part of an outstanding Loan from the Banks is to be repaid, each
Bank shall apply the proceeds of its new Loan to make such repayment and only
an amount equal to the difference (if any) between the amount being borrowed
and the amount being repaid shall be made available by such Bank to the Xxxx
Companies as provided in clause (c).
2.4. Interest. The following interest rates may be applicable to Loan or
Loans, as requested by the Xxxx Companies from time to time.
(a) Base Rate. Each Base Rate Loan shall bear interest on the principal
amount thereof from the date made until such Loan is paid in full or
converted, at a rate per annum equal to the Base Rate plus the Base Rate
Margin applicable to that type of Loan, i.e. Revolving Loan or Term Loan.
(b) LIBO Rate. Each LIBO Rate Loan shall bear interest on the principal
amount thereof from the date made until such Loan is paid in full, renewed,
or converted, at a rate per annum equal to the LIBO Rate plus the LIBO Rate
Margin applicable to that type of Loan, i.e. Revolving Loan or Term Loan.
After receipt of a request for a LIBO Rate Loan, First Union shall proceed to
determine the LIBO Rate to be applicable thereto. First Union shall give
prompt notice by telephone or facsimile to the Xxxx Companies of the LIBO
Rate thus determined in respect of each LIBO Rate Loan or any change therein.
Not more than five LIBO Rate Loans in the case of Revolving Loans nor three
LIBO Rate Loans in the case of Term Loans shall be in existence at any one
time in any combination of LIBO Rates applicable to said Loans.
(c) Renewals and Conversions of Loans. On the last day of each Interest
Period, the LIBO Rate Loan then maturing shall automatically be renewed for a
new Interest Period of like duration, unless the Xxxx Companies shall have
given First Union notice of a permitted conversion or renewal for an Interest
Period of different duration as provided in ss. hereof, or an Event of
Default, or Potential Default exists or would thereby occur. If no Event of
Default or Potential Default exists or would thereby occur, the Xxxx
Companies shall have the right to convert Base Rate Loans into LIBO Rate
Loans, to convert LIBO Rate Loans into Base Rate Loans, and to renew LIBO
Rate Loans for Interest Periods of different duration, from time to time,
provided that it shall give First Union notice of each permitted conversion
or renewal as provided in ss. hereof, and LIBO Rate Loans may be converted or
renewed for different Interest Periods only as of the last day of the
applicable Interest Period for such Loans. First Union shall use its best
efforts to notify the Xxxx Companies of the effectiveness of such conversion
or renewal (automatic or not automatic), and the new interest rate to which
the converted or renewed Loan is subject, as soon as practicable after the
conversion or renewal; provided, however, that any failure to give such
notice shall not affect the Xxxx Companies' obligations or the Banks' rights
and remedies hereunder in any way whatsoever. In the event a LIBO Rate Loan
is not automatically renewed as provided herein and the Xxxx Companies shall
not have
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Credit Agreement February 25, 1999
selected an alternative Interest Period for any LIBO Rate Loan
maturing as provided herein, such Loan shall be automatically converted into
a Base Rate Loan on the last day of the Interest Period for such Loan.
(d) Automatic Reinstatement. The liability of the Xxxx Companies under
this ss.2.4 shall continue to be effective or be automatically reinstated, as
the case may be, if at any time payment, in whole or in part, of any of the
payments to the Banks is rescinded or must otherwise be restored or returned
upon the insolvency, bankruptcy, dissolution, liquidation or reorganization
of the Xxxx Companies, or upon or as a result of the appointment of a
custodian, receiver, trustee or other officer with similar powers with
respect to any of the Xxxx Companies or any substantial part of their
property, all as though such payment had not been made.
2.5. Commitment Fee.
(i) Revolving Loans. The Xxxx Companies agree to pay for the account of
each Bank as compensation for its Revolving Loan Commitment, a fee
("Revolving Loan Commitment Fee") computed at the rate per annum set forth in
Schedule 3 attached to this Agreement on the average daily amount of the
unused portion of its Revolving Loan Commitment accrued from and after
November 17, 1998. The unused portion of its Revolving Loan Commitment shall
mean its Revolving Loan Commitment less the aggregate principal amount of its
outstanding Revolving Loans and its proportionate share of Letters of Credit
issued hereunder. The Revolving Loan Commitment Fee shall be calculated and
be payable quarterly in arrears and on the Revolving Credit Termination Date.
The Revolving Loan Commitment Fee shall be calculated on the basis of a
360-day year for the actual number of days elapsed.
(ii) Term Loans. The Xxxx Companies agree to pay for the account of each
Bank as compensation for its Term Loan Commitment, a fee ("Term Loan
Commitment Fee") computed at the rate per annum set forth in Schedule 3
attached to this Agreement on the average daily amount of the unused portion
of its Term Loan Commitment accrued from and after the date hereof. The
unused portion of its Term Loan Commitment shall mean its Term Loan
Commitment less the aggregate principal amount of its outstanding Term Loans
issued hereunder. The Term Loan Commitment Fee shall be calculated and be
payable quarterly in arrears and on the Term Credit Termination Date. The
Term Loan Commitment Fee shall be calculated on the basis of a 360-day year
for the actual number of days elapsed.
2.6. Reduction or Termination of Commitment.
(a) Loan Commitment Reduction or Termination.
(i) Revolving Loans. The Xxxx Companies may at any time and from
time to time, on not less than three (3) Business Days' written notice,
(i) permanently reduce the Aggregate Revolving Loan Commitment, provided that
any such reduction shall be in the amount of $5,000,000 or a multiple thereof
and that no such reduction shall cause the aggregate principal amount of
Revolving Loans outstanding to exceed the Aggregate Revolving Loan Commitment
as reduced, or (ii) terminate the Aggregate Revolving Loan Commitment. In the
event any Vessel constituting part of the Collateral is sold or otherwise
disposed of or is a total loss or constructive total loss for any reason, the
proceeds of the sale or other disposition or the insurance proceeds, as
applicable, shall be used promptly upon receipt thereof to prepay the
Revolving Loans in like amount and the Aggregate Revolving Loan Commitment
shall be permanently reduced in like amount except to the extent proceeds of
insurance may be used otherwise as provided in the applicable First Preferred
Ship Mortgage.
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Credit Agreement February 25, 1999
(ii) Term Loans. The Xxxx Companies may at any time and from time to
time, on not less than three (3) Business Days' written notice, (i)
permanently reduce the Aggregate Term Loan Commitment, provided that any such
reduction shall be in the amount of $2,500,000 or a multiple thereof and that
no such reduction shall cause the aggregate principal amount of Term Loans
outstanding to exceed the Aggregate Term Loan Commitment as reduced, or (ii)
terminate the Aggregate Term Loan Commitment. In the event any monies are
received in respect of the Insurance Claims, all such proceeds shall be used
promptly upon receipt thereof to prepay the Term Loans in like amount in
accordance with ss.2.7(d) hereof, and the Aggregate Term Loan Commitment
shall be permanently reduced such prepayment.
(b) Automatic Loan Commitment Termination.
(i) Revolving Loans. In the event the Aggregate Revolving Loan
Commitment is terminated, the Revolving Credit Termination Date shall
accelerate to such date of termination and the Xxxx Companies shall,
simultaneously with such termination, repay the Revolving Loans, whether Base
Rate Loans or LIBO Rate Loans, in accordance with ss.2.8.
(ii) Term Loans. In the event the Aggregate Term Loan Commitment is
terminated, the Term Credit Termination Date shall accelerate to such date of
termination and the Xxxx Companies shall, simultaneously with such
termination, repay the Term Loans, whether Base Rate Loans and LIBO Rate
Loans, in accordance with ss.2.8.
2.7. Prepayments.
(a) Base Rate Loans. On one Business Day's notice to the Bank, the Xxxx
Companies may, at their option, prepay any Base Rate Loan in whole at any
time or in part from time to time.
(b) LIBO Rate Loans. On one Business Day's notice to First Union and the
Banks, the Xxxx Companies may, at their option prepay any LIBO Rate Loan
provided that if they shall prepay a LIBO Rate Loan prior to the last day of
the applicable Interest Period, or shall fail to borrow any LIBO Rate Loan on
the date such Loan is to be made, they shall pay to each Bank, in addition to
the principal and interest then to be paid in the case of a prepayment, on
such date of prepayment, the Additional Amount (as defined in ss.2.8(e)
below) incurred or sustained by such Bank as a result of such prepayment or
failure to borrow.
(c) Sale or Loss of Vessel. In the event any Vessel constituting part of
the Collateral is sold or otherwise disposed of or is a total loss or
constructive total loss for any reason, the proceeds of the sale or other
disposition or the insurance proceeds, as applicable, shall be used promptly
upon receipt thereof to prepay the Revolving Loans in like amount except to
the extent proceeds of insurance may be used otherwise as provided in the
applicable First Preferred Ship Mortgage. The prepayments may be applied to
Revolving Loans which are Base Rate Loans or LIBO Rate Loans as the Xxxx
Companies may elect. If no election is made, the prepayments shall be applied
to Revolving Loans which are Base Rate Loans to the extent practicable.
(d) Proceeds of Insurance Claims. In the event any monies are paid in
respect of the Insurance Claims, such monies shall be used promptly upon
receipt thereof to prepay the Term Loans in like amount and all amounts in
excess of the amount necessary to pay aggregate amount of the Term Loans then
outstanding in full shall be promptly remitted to the Xxxx Companies. The
prepayments may be applied to Term Loans which are Base Rate Loans or LIBO
Rate Loans as the Xxxx Companies may elect. If no election
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Credit Agreement February 25, 1999
is made, the prepayments shall be applied to Term Loans which are Base
Rate Loans to the extent practicable.
(e) Proceeds of Debt or Equity Issuance. In the event the Xxxx Companies
or any of them shall issue additional capital stock in exchange for cash
(payable in lump sum or installments) or incur Indebtedness for Money
Borrowed (other than indebtedness incurred in connection with the purchase of
equipment which is secured by said equipment) to or from any Person other
than another Xxxx Company, the net proceeds of any such issuance or
incurrence shall be applied to prepayment of the Loans promptly following the
receipt of the proceeds thereof by the applicable Xxxx Company. Prepayment
shall be made first to Term Loans until such Loans are repaid in full and
second to Revolving Loans.
2.8. Payments.
(a) Base Rate Loans. Accrued interest on all Base Rate Loans shall be
due and payable on the first Business Day of each calendar month and upon the
Revolving Credit Termination Date or the Term Credit Termination Date, as
applicable.
(b) LIBO Rate Loans. Accrued interest on LIBO Loans with Interest
Periods of one, two or three months shall be due and payable on the last day
of such Interest Period. Accrued interest on LIBO Rate Loans with an Interest
Period of six months shall be due and payable on the last day of the third
month of such Interest Period and on the last day of such Interest Period.
(c) Form of Payments, Application of Payments, Payment Administration,
Etc. Provided that no Event of Default or Potential Default then exists and
except as provided in ss.2.7(e), all payments and prepayments shall be
applied to the Loans in such order and to such extent as shall be specified
by the Xxxx Companies, by written notice to First Union at the time of such
payment or prepayment. Except as otherwise provided herein, all payments of
principal, interest, fees, or other amounts payable by the Xxxx Companies
hereunder shall be remitted to First Union on behalf of the Banks at the
address set forth opposite its name on the signature page hereof or at such
office or account as First Union shall specify to the Xxxx Companies, in
immediately available funds not later than 2:00 p.m. on the day when due.
Whenever any payment is stated as due on a day which is not a Business Day,
the maturity of such payment shall, except as otherwise provided in the
definition of "Interest Period," be extended to the next succeeding Business
Day and interest shall continue to accrue during such extension. The Xxxx
Companies authorize First Union to deduct from any account of any Xxxx
Company maintained at First Union or over which First Union has control any
amount payable under this Agreement, the Notes or any other Loan Document.
First Union's failure to deliver any xxxx, statement or invoice with respect
to principal amounts due shall not affect the Xxxx Companies' obligation to
pay such principal when due and payable.
(d) Net Payments. All payments made to the Banks by the Xxxx Companies
hereunder, under the Notes or under any other Loan Document will be made
without set off, counterclaim or other defense. All such payments will be
made free and clear of, and without deduction or withholding for, any present
or future taxes, levies, imposts, duties, fees, assessments or other charges
of whatever nature now or hereafter imposed by any jurisdiction or any
political subdivision or taxing authority thereof or therein (but excluding,
except as provided below, any tax imposed on or measured by the net income of
a Bank (including all interest, penalties or similar liabilities related
thereto) and any tax imposed on or measured by the gross income of a Bank
pursuant to the laws of the United States of America or any political
subdivision thereof, or taxing authority of the United States of America or
any political subdivision thereof, in which the principal
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Credit Agreement February 25, 1999
office or applicable lending office of a Bank is located), and all
interest, penalties or similar liabilities with respect thereto
(collectively, all such non-excluded amounts being "Taxes"). If any Taxes are
so levied or imposed, the Xxxx Companies agree to pay the full amount of such
Taxes, and such additional amounts as may be necessary so that every payment
of all amounts due hereunder, under any Note or under any other Loan
Document, after withholding or deduction for or on account of any Taxes, will
not be less than the amount provided for herein or in such Note. The Xxxx
Companies will furnish to each Bank upon request certified copies of tax
receipts evidencing such payment by them. The Xxxx Companies will indemnify
and hold harmless each Bank, and reimburse each Bank upon its written
request, for the amount of any Taxes so levied or imposed and paid or
withheld by each Bank.
(e) Prepayment of LIBO Rate Loans. If any principal of a LIBO Rate Loan
shall be repaid (whether upon prepayment, reduction of the Loan Commitment
after acceleration or for any other reason) or converted to a Base Rate Loan
prior to the last day of the Interest Period applicable to such LIBO Rate
Loan or if the Xxxx Companies fail for any reason to borrow a LIBO Rate Loan
after giving irrevocable notice pursuant to ss.2.5, the Xxxx Companies shall pay
to First Union on behalf of the Banks, in addition to the principal and
interest then to be paid, such additional amounts as may be necessary to
compensate each Bank for all direct and indirect costs and losses (including
losses resulting from redeployment of prepaid or unborrowed funds at rates
lower than the cost of such funds to each Bank, and including lost profits
incurred or sustained by each Bank) as a result of such repayment or failure
to borrow (the "Additional Amount"). The Additional Amount (which each Bank
shall take reasonable measures to minimize) shall be specified in a written
notice or certificate delivered to the Xxxx Companies by First Union, as
Agent. Such notice or certificate shall contain a calculation in reasonable
detail of the Additional Amount to be compensated and shall be conclusive as
to the facts and the amounts stated therein, absent manifest error.
(f) Demand Deposit Account. At least one of the Xxxx Companies shall
maintain at least one demand deposit account with First Union National Bank
for purposes of this Agreement. The Xxxx Companies authorize First Union (but
First Union shall not be obligated) to deposit into said account all amounts
to be advanced to the Xxxx Companies hereunder. Further, the Xxxx Companies
authorize First Union (but First Union shall not be obligated) to deduct from
said account, or any other account maintained by any Xxxx Company at First
Union, any amount payable hereunder on or after the date upon which it is due
and payable. Such authorization shall include but not be limited to amounts
payable with respect to principal, interest, fees and expenses.
2.9. Changes in Circumstances; Yield Protection.
(a) If any Regulatory Change or compliance by any Bank with any request
made after the date of this Agreement by the Board of Governors of the Federal
Reserve System or by any Federal Reserve Bank or other central bank or fiscal,
monetary or similar authority (in each case whether or not having the force of
law) shall:
(i) impose, modify or make applicable any reserve, special deposit,
Federal Deposit Insurance Corporation premium or similar requirement or
imposition against assets held by, or deposits in or for the account of,
or loans made by, or any other acquisition of funds for loans or
advances by, any Bank; or
(ii) impose on any Bank any other condition regarding either of its
Notes.
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Credit Agreement February 25, 1999
and the result of any of the foregoing events is to increase the cost to
any Bank of making or maintaining any Loan or to reduce the amount of
principal, interest or fees to be received by any Bank hereunder in respect
of any Loan, such Bank will immediately so notify and the Xxxx Companies. If
such Bank determines in good faith that the effects of the change resulting
in such increased cost or reduced amount cannot reasonably be avoided or the
cost thereof mitigated, then upon notice by such Bank to the Xxxx Companies,
the Xxxx Companies shall pay to such Bank on each interest payment date of
the Loan, such additional amount as shall be necessary to compensate such
Bank for such increased cost or reduced amount.
(b) If any Bank shall determine that any Regulation regarding capital
adequacy or the adoption of any Regulation regarding capital adequacy, which
Regulation is applicable to banks (or their holding companies) generally and not
a specific Bank (or its holding company) specifically, or any change therein, or
any change in the interpretation or administration thereof by any governmental
authority, central bank or comparable agency charged with the interpretation or
administration thereof, or compliance by such Bank (or its holding company) with
any such request or directive regarding capital adequacy (whether or not having
the force of law) of any such authority, central bank or comparable agency, has
the effect of reducing the rate of return on such Bank's capital as a
consequence of its obligations hereunder to a level below that which such Bank
could have achieved but for such adoption, change or compliance (taking into
consideration such Bank's policies with respect to capital adequacy) by an
amount deemed by such Bank to be material, the Xxxx Companies shall promptly pay
to such Bank, upon the demand of such Bank, such additional amount or amounts as
will compensate such Bank for such reduction.
(c) If any Bank shall determine that by reason of abnormal circumstances
affecting the interbank eurodollar or applicable eurocurrency market, adequate
and reasonable means do not exist for ascertaining the LIBO Rate to be
applicable to the requested LIBO Rate Loan or that eurodollar or eurocurrency
funds in amounts sufficient to fund all the LIBO Rate Loans are not obtainable
on reasonable terms, such Bank shall give notice of such inability or
determination by telephone and thereupon the obligations of the Banks to make,
convert other Loans to, or renew such LIBO Rate Loan shall be excused, subject,
however, to the right of the Xxxx Companies at any time thereafter to submit
another request.
(d) Determination by any Bank for purposes of this Section 2.9 of the
effect of any Regulatory Change or other change or circumstance referred to
above on its costs of making or maintaining Loans or on amounts receivable by it
in respect of the Loans and of the additional amounts required to compensate the
Bank in respect of any additional costs, shall be made in good faith and shall
be evidenced by a certificate, signed by an officer of such Bank and delivered
to the Xxxx Companies, as to the fact and amount of the increased cost incurred
by or the reduced amount accruing to such Bank owing to such event or events.
Such certificate shall be prepared in reasonable detail and shall be conclusive
as to the facts and amounts stated therein, absent manifest error.
(e) Each Bank will notify the Xxxx Companies and of any event occurring
after the date of this Agreement that will entitle such Bank to compensation
pursuant to this Section as promptly as practicable after it obtains knowledge
thereof and determines to request such compensation. Said notice shall be in
writing, shall specify the applicable Section or Sections of this Agreement to
which it relates and shall set forth the amount or amounts then payable pursuant
to this Section. The Xxxx Companies shall pay such Bank the amount shown as due
on such notice within 30 days after its receipt of the same.
2.10. Illegality. Notwithstanding any other provision in this Agreement,
if the adoption of any applicable Regulation, or any change therein, or any
change in the interpretation or administration thereof
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Credit Agreement February 25, 1999
by any governmental authority, central bank, or comparable agency charged with
the interpretation or administration thereof, or compliance by any Bank
with any request or directive (whether or not having the force of law) of any
such authority, central bank, or comparable agency shall make it unlawful or
impossible for such Bank to (1) maintain its Revolving Loan Commitment or
Term Loan Commitment, then upon notice to the Xxxx Companies by such Bank,
the Revolving Loan Commitment or Term Loan Commitment of such Bank shall
terminate; or (2) maintain or fund its LIBO Rate Loans, then upon notice to
the Xxxx Companies of such event, the Xxxx Companies' outstanding LIBO Rate
Loans shall be converted into Base Rate Loans.
3. Representations and Warranties
Each of the Xxxx Companies represents and warrants to the Banks that:
3.1. Organization, Standing. It (i) is a corporation duly organized,
validly existing and in good standing under the laws of the jurisdiction of
its incorporation, (ii) has the corporate power and authority necessary to
own its assets, carry on its business and enter into and perform its
obligations hereunder and under each Loan Document, and (iii) is qualified to
do business and is in good standing in each jurisdiction where the nature of
its business or the ownership of its properties requires such qualification,
except where the failure to be so qualified would not have a Material Adverse
Effect.
3.2. Corporate Authority, Validity, Etc. The making and performance of
the Loan Documents to which it is a party are within its power and authority
and have been duly authorized by all necessary corporate action. Except as
has been obtained, the making and performance of the Loan Documents do not
and under present law will not require any consent or approval of any of its
shareholders or any other person, do not and under present law will not
violate any law, rule, regulation order, writ, judgment, injunction, decree,
determination or award, do not violate any provision of its charter or
by-laws, do not and will not result in any breach of any material agreement,
lease or instrument to which it is a party, by which it is bound or to which
any of its assets are or may be subject, and do not and will not give rise to
any Lien upon any of its assets, except for the liens provided for herein.
The number of shares and classes of the capital stock of each of the Xxxx
Companies and the ownership thereof are accurately set forth on Schedule 1
attached hereto; all such shares are validly issued, fully paid and
non-assessable, and the issuance and sale thereof are in compliance with all
applicable federal and state securities and other applicable laws. Further,
none of the Xxxx Companies is in default under any such agreement, lease or
instrument except to the extent such default reasonably could not have a
Material Adverse Effect. No authorizations, approvals or consents of, and no
filings or registrations with, any governmental or regulatory authority or
agency are necessary for the execution, delivery or performance by the Xxxx
Companies of any Loan Document or for the validity or enforceability thereof.
Each Loan Document, when executed and delivered, will be the legal, valid and
binding obligation of each of the Xxxx Companies enforceable against it in
accordance with its terms.
3.3. Litigation. Except as disclosed on Schedule 1, there are no actions,
suits or proceedings pending or threatened against or affecting any of the
Xxxx Companies or any of their assets before any court, government agency, or
other tribunal which if adversely determined reasonably could have a Material
Adverse Effect upon the ability of the Xxxx Companies or any of them to
perform under the Loan Documents. If there is any disclosure on Schedule 1,
the status (including the tribunal, the nature of the claim and the amount in
controversy) of each such litigation matter as of the date of this Agreement
is set forth in Schedule 1.
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Credit Agreement February 25, 1999
3.4. ERISA. (a) the Xxxx Companies and each ERISA Affiliate are in
compliance in all material respects with all applicable provisions of ERISA
and the regulations promulgated thereunder; and, except as disclosed on
Schedule 1, since April 29, 1980, none of the Xxxx Companies or any ERISA
Affiliate has withdrawn from participation in any "multiemployer plan" (as
defined in section 4001 of ERISA) to which it makes contributions such that
any withdrawal liability has been or may be assessed and remains unpaid, and
none of the Xxxx Companies or any ERISA Affiliate has received any notice and
is not aware that any multiemployer plan to which it contributes is insolvent
or in reorganization status within the meaning of ERISA. With respect to
multiemployer plans to which the Xxxx Companies or any ERISA Affiliate makes
contributions but does not participate in the administration of such plans,
none of the Xxxx Companies or any ERISA Affiliate has received any
information from any such multiemployer plan which would indicate that any of
the foregoing representation would be incorrect as applied to such
multiemployer plan; (b) neither the Xxxx Companies nor any ERISA Affiliate
sponsors or maintains any Plan under which there is an accumulated funding
deficiency within the meaning of ss.412 of the Code, whether or not waived;
(c) the aggregate liability for accrued benefits and other ancillary benefits
under each Plan that is or will be sponsored or maintained by the Xxxx
Companies or any ERISA Affiliate (determined on the basis of the actuarial
assumptions prescribed for valuing benefits under terminating single-employer
defined benefit plans under Title IV of ERISA) does not exceed the aggregate
fair market value of the assets under each such defined benefit pension Plan;
(d) the aggregate liability of the Xxxx Companies and each ERISA Affiliate
arising out of or relating to a failure of any Plan to comply with the
provisions of ERISA or the Code, will not have a Material Adverse Effect; (e)
there does not exist any unfunded liability (determined on the basis of
actuarial assumptions utilized by the actuary for the plan in preparing the
most recent Annual Report) of the Xxxx Companies or any ERISA Affiliate under
any plan, program or arrangement providing post-retirement life or health
benefits; and (f) none of the Plans which are "employee pension benefit
plans" (as defined by ERISA) or the trusts created thereunder have been
terminated since September 2, 1974; nor has any such Plan incurred any
material liability to the Pension Benefit Guaranty Corporation established
pursuant to ERISA, other than for required insurance premiums which have been
paid when due, or incurred any material "accumulated funding deficiency," (as
defined by ERISA) whether or not waived; nor has there been any "reportable
event" (as defined by ERISA), or other event or condition, which represents a
material risk of termination of any such Plan by the Pension Benefit Guaranty
Corporation.
3.5. Financial Statements and Projections.
(a) Financial Statements. The consolidated and consolidating financial
statements (which consolidating balance sheets may be unaudited and prepared by
management) of The Xxxx Group, Inc. and its subsidiaries for the Fiscal Years
ending December 31, 1996 and December 31, 1997 and for the interim nine-month
period ending September 30, 1998, consisting in each case of a balance sheet, a
statement of operations, a statement of shareholders' equity, a statement of
cash flows and accompanying footnotes (except in the case of interim financial
statements), furnished to the Banks in connection herewith, present fairly, in
all material respects, the financial position, results of operations and
operating statistics of the Xxxx Group, Inc. and its subsidiaries as of the
dates and for the periods referred to, in conformity with Generally Accepted
Accounting Principles. Except as set forth on Schedule 1 hereto, there are no
material liabilities, fixed or contingent, which are not reflected in such
financial statements, other than liabilities which are not required to be
reflected in such balance sheets. There has been no Material Adverse Change
since September 30, 1998.
(b) Projections. The summary form consolidated balance sheet and
consolidated income statement of The Xxxx Group, Inc. and its subsidiaries,
furnished to the Banks in connection herewith, show historical
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Credit Agreement February 25, 1999
information on a quarterly basis for the calendar quarters ending March
31, 1998 through September 30, 1998, and projections on a quarterly basis for
the calendar quarters ending December 31, 1998 through December 31, 1999. The
historical information is taken from the financial statements referred to in
clause (a) above for the interim nine-month period ending September 30, 1998.
The projections are based upon good faith estimates and assumptions believed
to be reasonable, it being recognized by First Union and the Banks that such
projections as to future events are not to be viewed as facts and that actual
results during the periods covered by such projections may differ materially
from the projected results.
3.6. Not in Default, Judgments, Etc. No Event of Default or Potential
Default under any Loan Document has occurred and is continuing. Each of the
Xxxx Companies has satisfied all judgments and is not in default with respect
to any judgment, writ, injunction, decree, rule, or regulation of any court,
arbitrator, or federal, state, municipal, or other governmental authority,
commission, board, bureau, agency, or instrumentality, domestic or foreign
which could reasonably be expected to have a Material Adverse Effect.
3.7. Taxes. Each of the Xxxx Companies has filed all federal, state,
local and foreign tax returns and reports which it is required by law to file
and as to which its failure to file would have a Material Adverse Effect, and
has paid all taxes, including wage taxes, assessments, withholdings and other
governmental charges which are presently due and payable, other than those
being contested in good faith by appropriate proceedings, if any, and/or
disclosed on Schedule 1. The tax charges, accruals and reserves on the books
of the Xxxx Companies are adequate to pay all such taxes that have accrued
but are not presently due and payable.
3.8. Permits, Licenses, Etc. Each of the Xxxx Companies possesses all
permits, licenses, franchises, trademarks, trade names, copyrights and
patents necessary to the conduct of its business as presently conducted or as
presently proposed to be conducted, except where the failure to possess the
same would not have a Material Adverse Effect.
3.9. No Materially Adverse Contracts, Etc. None of the Xxxx Companies is
subject to any charter, corporate or other legal restriction, or any
judgment, decree, order, rule or regulation which in the judgment of its
directors or officers has or is reasonably expected in the future to have a
Material Adverse Effect upon it or any Subsidiary. Neither the Xxxx Companies
nor any Subsidiary is a party to any contract or agreement which in the
judgment of its directors or officers has or is reasonably expected to have
any Material Adverse Effect except as otherwise reflected in adequate
reserves.
3.10. Compliance with Laws, Etc.
(a) Compliance Generally. Each of the Xxxx Companies is in compliance in
all material respects with all Regulations applicable to its business (including
obtaining all authorizations, consents, approvals, orders, licenses, exemptions
from, and making all filings or registrations or qualifications with, any court
or governmental department, public body or authority, commission, board, bureau,
agency, or instrumentality), the noncompliance with which reasonably could have
a Material Adverse Effect.
(b) Hazardous Wastes, Substances and Petroleum Products. Except as
disclosed on Schedule 1, (i) each of the Xxxx Companies has received all permits
and filed all notifications necessary to carry on its business; and is in
compliance in all respects with all Environmental Control Statutes; (ii) none of
the Xxxx Companies has not given any written or oral notice, nor has it failed
to give required notice, to
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Credit Agreement February 25, 1999
the Environmental Protection Agency ("EPA") or any state or local agency
with regard to any actual or imminently threatened Release of Hazardous
Substances on properties owned, leased or operated by it or used in
connection with the conduct of its business and operations; (iii) none of the
Xxxx Companies has received notice that it is potentially responsible for
costs of clean-up or remediation of any actual or imminently threatened
Release of Hazardous Substances pursuant to any Environmental Control
Statute; (iv) no real property owned or leased by any of the Xxxx Companies
is in violation of any Environmental Laws and no Hazardous Substances are
present on said real property in violation of applicable law; and (v) none of
the Xxxx Companies has been identified in any litigation, administrative
proceedings or investigation as a potentially responsible party for any
liability under any Environmental Laws, where such liability could have a
Material Adverse Effect.
3.11. Solvency. Each of the Xxxx Companies is, and after giving effect
to the transactions contemplated hereby, will be, Solvent. In determining
solvency, each Xxxx Company shall be entitled to treat as an asset (in the
form of receivables from the other Xxxx Companies) the contribution
obligations of the other Xxxx Companies to the determining Xxxx Company in
the event the determining Xxxx Company were to pay the entirety of Loans
outstanding under this Agreement, provided, however each contribution
obligation shall be net of a reserve for any doubt in the ability of the
applicable contribution obligor to pay its contribution obligation.
3.12. Subsidiaries, Etc. None of the Xxxx Companies has any
Subsidiaries, except as set forth in Schedule 1 hereto. Set forth in Schedule
1 hereto is a complete and correct list, as of the date of this Agreement, of
all Investments held by the Xxxx Companies in any joint venture or other
Person.
3.13. Title to Properties, Leases. Each of the Xxxx Companies has good
and marketable title to all assets and properties reflected as being owned by
it in its financial statements as well as to all assets and properties
acquired since said date (except property disposed of since said date in the
ordinary course of business). Except for the Liens set forth in Schedule 1
hereto and any other Permitted Liens, there are no Liens on any of such
assets or properties. Each of the Xxxx Companies has the right to, and does,
enjoy peaceful and undisturbed possession under all material leases under
which it is leasing property as a lessee. All such leases are valid,
subsisting and in full force and effect, and none of such leases is in
default, except where such default, either individually or in the aggregate,
could not have a Material Adverse Effect.
3.14. Public Utility Holding Company; Investment Company. None of the
Xxxx Companies is a "public utility company" or a "holding company", or a
"subsidiary company" of a "holding company", or an "affiliate" of a "holding
company" or of a "subsidiary company" of a "holding company", as such terms
are defined in the Public Utility Holding Company Act of 1935, as amended; or
a "public utility" within the meaning of the Federal Power Act, as amended.
Further, none of the Xxxx Companies is an "investment company" or an
"affiliated person" of an "investment company" or a company "controlled" by
an "investment company" as such terms are defined in the Investment Company
Act of 1940, as amended.
3.15. Margin Stock. None of the Xxxx Companies is or will be engaged
principally or as one of its important activities in the business of
extending credit for the purpose of purchasing or carrying or trading in any
margin stocks or margin securities (within the meaning of Regulation U of the
Board of Governors of the Federal Reserve System as amended from time to
time). None of the Xxxx Companies will use or permit any proceeds of the
Loans to be used, either directly or indirectly, for the purpose, whether
immediate, incidental or ultimate, of buying or carrying margin stocks or
margin securities.
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Credit Agreement February 25, 1999
3.16. Use of Proceeds. The Xxxx Companies will use the proceeds of each
Revolving Loan only for working capital financing, capital renovations to
existing Vessels and other general corporate purposes. The proceeds of each
Term Loan will be used only for repairs and improvements to the properties,
real and personal, which were damaged principally as a consequence of
Hurricane Georges which occurred in September 1998 and which are or are
expected to be included in the Insurance Claims, as well as incremental
working capital financing and other general corporate purposes arising
therefrom.
3.17. Year 2000 Problem. The Xxxx Companies are taking all action
reasonably necessary to assess the risk that the computer applications they
use in their business may be unable to properly perform date sensitive
functions on or after January 1, 2000. Further, they are in the process of
taking all remedial action reasonably necessary to avoid such risk and expect
to timely complete such action. To their knowledge, no third party with which
any of them has any material contractual relationship has identified any
similar risk in its own computer applications which it is not addressing and
which, if not properly addressed, would be likely to have a Material Adverse
Effect.
3.18. Disclosure Generally. The representations and statements made by
each of the Xxxx Companies or on its behalf in connection with this credit
facility and the Loans, including representations and statements in each of
the Loan Documents, do not and will not contain any untrue statement of a
material fact or omit to state a material fact or any fact necessary to make
the representations made not materially misleading. No written information,
exhibit, report, brochure or financial statement furnished by any of the Xxxx
Companies to the Banks in connection with this credit facility, the Loans, or
any Loan Document contains or will contain any material misstatement of fact
or omit to state a material fact or any fact necessary to make the statements
contained therein not misleading.
4. Conditions Precedent
4.1. All Loans. The obligation of each Bank to make any Loan (including
but not limited to the first Loan hereunder after the date of this amended
and restated Credit Agreement) and the obligation of First Union to issue any
Letter of Credit are conditioned upon the following:
(a) Documents.
(i) Request for Advance. The Xxxx Companies shall have delivered and
First Union shall have received a request for a Revolving Loan or Term Loan
in such form as First Union may request from time to time.
(ii) Insurance Claims. The Xxxx Companies shall have delivered and
First Union shall have received certification by an executive officer of
The Xxxx Group, with supporting schedules and detailed information
satisfactory to First Union, that the aggregate amount of any Term Loans
outstanding immediately following the making of the requested Term Loans will
not be more than fifty percent (50%) of the aggregate amount of the then
unpaid Insurance Claims.
(iii) Permitted Indebtedness. The Xxxx Companies shall have delivered
and First Union shall have received certification by an executive officer of
The Xxxx Group, with supporting schedules and information satisfactory to
First Union, the Revolving Loans or Term Loans requested will upon the making
of such Loans by the Banks not cause The Xxxx Group to be breach of its
agreements with respect to
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Credit Agreement February 25, 1999
"permitted indebtedness" or "permitted liens" relating to the 9 3/4%
Notes issued by The Xxxx Group under an Indenture dated January 21, 1998, as
such Indenture may be amended, modified or replaced from time to time.
(iv) Other Documents. The Xxxx Companies shall have delivered and
First Union shall have received such other certificates, opinions, documents,
assurances, etc. as it may reasonably require or reasonably deem advisable
in connection with the making of the requested Loans.
(b) Covenants; Representations. The Xxxx Companies shall be in
compliance with all covenants, agreements and conditions in each Loan
Document and each representation and warranty contained in each Loan Document
shall be true with the same effect as if such representation or warranty had
been made on the date such Revolving Loan, Term Loan or Letter of Credit, as
applicable, is made or issued.
(c) Defaults. Immediately prior to and after giving effect to such
transaction, no Event of Default or Potential Default shall exist.
(d) Material Adverse Change. Since September 30, 1998, there shall not
have been any Material Adverse Change with respect to the Xxxx Companies or
any Subsidiary.
4.2. Conditions to First Loan. In addition to the conditions to all
Loans as provided in ss., the obligation of each Bank to make its first Loan
under this amended and restated Credit Agreement is conditioned upon the
following:
(a) Articles, Bylaws. Each Bank shall have received copies of the
Articles of Incorporation and Bylaws of each Xxxx Company certified by its
Secretary or Assistant Secretary; together with a Certificate of Good
Standing from any jurisdiction where the nature of its business or the
ownership of its properties requires such qualification except where the
failure to be so qualified would not have a Material Adverse Effect.
(b) Evidence of Authorization. Each Bank shall have received copies
certified by the Secretary or Assistant Secretary of each Xxxx Company of all
corporate or other action taken by such Xxxx Company to authorize its
execution and delivery and performance of the Loan Documents and to authorize
the Loans, together with such other related papers as First Union shall
reasonably require.
(c) Legal Opinions. Each Bank shall have received a favorable written
opinion in form and substance satisfactory to the Bank from Xxxxxx Xxxxxxxx
LLP, Xxxx X. Xxxxx, Esq. and such other counsel as it shall deem necessary,
as counsel for the Xxxx Companies, which shall be addressed to the Banks and
be dated the date of the first Loan under this amended and restated Credit
Agreement.
(d) Incumbency. First Union, on behalf of the Banks, shall have received
a certificate signed by the secretary or assistant secretary of each Xxxx
Company, together with the true signature of the officer or officers
authorized to execute and deliver the Loan Documents and certificates
thereunder, upon which the Banks shall be entitled to rely conclusively until
it shall have received a further certificate of the secretary or assistant
secretary of such Xxxx Company amending the prior certificate and submitting
the signature of the officer or officers named in the new certificate as
being authorized to execute and deliver Loan Documents and certificates
thereunder.
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Credit Agreement February 25, 1999
(e) Notes. Each Bank shall have received its Revolving Note and Term
Note duly executed, completed and issued in accordance herewith.
(f) Collateral Documents. First Union, on behalf of the Banks, shall
have received (i) a First Preferred Ship Mortgage duly executed, completed and
issued in accordance herewith pertaining to each seagoing vessel included in the
Collateral each in form and substance acceptable to it, (ii) a Pledge Agreement
duly executed, completed and delivered pledging all of the issued and
outstanding shares of capital stock of NPR, Holding, NPR, Inc., NPR-Navieras and
NPR S.A. together with the stock certificates being so pledged, (iii) a Security
Agreement duly executed, completed and delivered pledging all of the Accounts
and related General Intangible of each Xxxx Company and (iv) an Assignment of
Insurance Claims duly executed, completed and delivered assigning to the Banks
all rights of each Xxxx Company to receive payments under the described
insurance policy.
(g) Other Documents. First Union, on behalf of the Banks, shall have
received all certificates, instruments, and other documents then required to be
delivered pursuant to any Loan Documents, in each instance in form and substance
reasonably satisfactory to it, together with each other Loan Document required
hereunder.
(h) Consents. The Xxxx Companies shall have provided to each Bank
evidence satisfactory to it that all governmental, shareholder and third party
consents and approvals necessary in connection with the transactions
contemplated hereby have been obtained and remain in effect.
(i) Fees, Expenses. The Xxxx Companies shall simultaneously pay or shall
have paid all fees and expenses due hereunder or under any other Loan Document.
(j) Financial Projections. The Xxxx Companies shall have provided to
each Bank financial projections referred to in ss.3.5(b).
5. Affirmative Covenants
The Xxxx Companies covenant and agree, individually and collectively,
that from and after the date hereof and so long as the Aggregate Revolving Loan
Commitment or Aggregate Term Loan Commitment is in effect or any Obligation
remains unpaid or outstanding, they and each of them will and their subsidiaries
will:
5.1. Financial Statements and Reports. Furnish to the Banks the following
financial information:
(a) Annual Statements. No later than one hundred and twenty (120) days
after the end of each Fiscal Year or such earlier date as the Xxxx Group, Inc.
and its subsidiaries shall file their annual financial statements with the
Securities and Exchange Commission, the consolidated and consolidating balance
sheet (which consolidating balance sheets may be unaudited and prepared by
management) of the Xxxx Group, Inc. and its subsidiaries as of the end of such
year and the prior year in comparative form, and related statements of
operations, shareholders' equity, and cash flows for the Fiscal Year and the
prior Fiscal Year in comparative form. The financial statements shall be in
reasonable detail with appropriate notes and be prepared in accordance with
Generally Accepted Accounting Principles. The consolidated annual financial
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Credit Agreement February 25, 1999
statements shall be certified (without any qualification or exception) by BDO
Xxxxxxx LLP or such other independent certified public accountants of nationally
recognized standing reasonably acceptable to First Union. Such financial
statements shall be accompanied by a report of such independent certified public
accountants stating that, in the opinion of such accountants, such financial
statements present fairly, in all material respects, the financial position, and
the results of operations and the cash flows of the Xxxx Group, Inc. and its
subsidiaries for the period then ended in conformity with Generally Accepted
Accounting Principles, except for inconsistencies resulting from changes in
accounting principles and methods agreed to by such accountants and specified in
such report, and that, in the case of such financial statements, the examination
by such accountants of such financial statements has been made in accordance
with generally accepted auditing standards and accordingly included examining,
on a test basis, evidence supporting the amounts and disclosures in the
financial statements and assessing the accounting principles used and
significant estimates made, as well as evaluating the overall financial
statement presentation. In addition to the annual financial statements, the Xxxx
Companies shall, promptly upon receipt thereof, furnish to the Banks copies of
each other report submitted to its board of directors by its independent
accountants in connection with any annual, interim or special audit made by them
of the financial records of the Xxxx Group, Inc. and its subsidiaries.
(b) Quarterly Statements. No later than sixty (60) days after the end of
each Fiscal Quarter of each Fiscal Year or such earlier date as the Xxxx Group,
Inc. and its subsidiaries shall file their quarterly financial statements with
the Securities and Exchange Commission, the consolidated and consolidating
balance sheet (which consolidating balance sheets may be unaudited and prepared
by management) and related consolidated and consolidating statements of
operations, shareholders' equity and cash flows of the Xxxx Group, Inc. and its
subsidiaries for such quarterly period and for the period from the beginning of
such fiscal year to the end of such Fiscal Quarter and a corresponding financial
statement for the same periods in the preceding Fiscal Year certified by the
chief financial officer of the Xxxx Group, Inc. and its subsidiaries as having
been prepared in accordance with Generally Accepted Accounting Principles
(subject to changes resulting from audits and year-end adjustments).
(c) Compliance Certificate. Simultaneously with the delivery of the
financial statements referred to in clauses (a) and (b) of this Section, a
Compliance Certificate signed by the chief financial officer of the Xxxx Group,
Inc. and its subsidiaries.
(d) ERISA. All reports and forms filed with respect to all Plans, except
as filed in the normal course of business and that would not result in an
adverse action to be taken under ERISA, and details of related information of a
Reportable Event, promptly following each filing.
(e) Material Changes. Notification to First Union, and each other Bank,
of any litigation, administrative proceeding, investigation, business
development, or change in financial condition which could reasonably have a
Material Adverse Effect, promptly following its discovery.
(f) Summary Annual Budget. Within one hundred twenty (120) calendar days
after the end of each Fiscal Year, a budget for the then current Fiscal Year
setting forth in reasonably detail at least by Fiscal Quarters projected profit
or loss, resulting balance sheets, cash flows and anticipated Loans under this
credit facility.
(g) Other Information. Promptly, upon request by First Union or each
other Bank, from time to time (which may be on a monthly or other basis), the
Xxxx Companies shall provide such other information and reports regarding
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Credit Agreement February 25, 1999
its operations, business affairs, prospects and financial condition as the Banks
may reasonably request.
5.2. Corporate Existence. Preserve their, and cause their Subsidiaries to
preserve their, corporate existence and all material franchises, licenses,
patents, copyrights, trademarks and trade names consistent with good business
practice; and maintain, keep, and preserve all of their properties (tangible and
intangible) necessary or useful in the conduct of their businesses in good
working order and condition, ordinary wear and tear excepted.
5.3. ERISA. Comply in all material respects with the provisions of ERISA to
the extent applicable to any Plan maintained for the employees of the Xxxx
Companies or any ERISA Affiliate; do or cause to be done all such acts and
things that are required to maintain the qualified status of each Plan and tax
exempt status of each trust forming part of such Plan; not incur any material
accumulated funding deficiency (within the meaning of ERISA and the regulations
promulgated thereunder), or any material liability to the PBGC (as established
by ERISA); not permit any event to occur as described in ss.4042 of ERISA or
which may result in the imposition of a lien on their properties or assets;
notify the Banks in writing promptly after it has come to the attention of
senior management of the Xxxx Companies of the assertion or threat of any
"reportable event" or other event described in ss.4042 of ERISA (relating to the
soundness of a Plan) or the PBGC's ability to assert a material liability
against it or impose a lien on their, or any ERISA Affiliates' properties or
assets; and refrain from engaging in any Prohibited Transactions or actions
causing possible liability under ss.5.02 of ERISA.
5.4. Compliance with Regulations. Comply, and cause their Subsidiaries to
comply, in all material respects with all Regulations applicable to their
businesses, the noncompliance with which reasonably could have a Material
Adverse Effect.
5.5. Conduct of Business; Permits and Approvals, Compliance with Laws.
Continue to engage, and cause their Subsidiaries to continue to engage, in an
efficient and economical manner in businesses substantially the same as
conducted by them on the date of this Agreement; maintain, and cause their
Subsidiaries to maintain, in full force and effect, its and their franchises,
and all licenses, patents, trademarks, trade names, contracts, permits,
approvals and other rights necessary to the profitable conduct of their
businesses.
5.6. Maintenance of Insurance. Keep and maintain, and cause their
Subsidiaries to keep and maintain, all of its and their property and assets
covered by insurance with reputable and financially sound insurance companies
against such hazards and in such amounts as is customary in the industry, under
policies requiring the insurer to furnish thirty (30) days' prior notice to the
Bank and opportunity to cure any non- payment of premiums prior to termination
of coverage; and furnish the Bank with certificates of such insurance and cause
the Bank to be named as an additional insured and the loss payee thereof with
respect to the Collateral, as its interest may appear.
5.7. Payment of Debt; Payment of Taxes, Etc. Where the amount involved
exceeds $1,000,000 or where the non-payment or non-discharge would otherwise
have a Material Adverse Effect on the Xxxx Companies or any of their
Subsidiaries, or any of their assets: promptly pay and discharge, and cause
their Subsidiaries to promptly pay and discharge, (a) all of their Debt in
accordance with the terms thereof; (b) all taxes, assessments, and governmental
charges or levies imposed upon them or upon their income and profits, upon any
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Credit Agreement February 25, 1999
of their property, real, personal or mixed, or upon any part thereof, before the
same shall become in default; (c) all lawful claims for labor, materials and
supplies or otherwise, which, if unpaid, might become a lien or charge upon such
property or any part thereof; provided, however, that so long as the Xxxx
Companies first notifies First Union of their intention to do so, the Xxxx
Companies or their Subsidiaries shall not be required to pay and discharge any
such Debt, tax, assessment, charge, levy or claim so long as the failure to so
pay or discharge does not constitute or result in an Event of Default or a
Potential Default hereunder and so long as no foreclosure or other similar
proceedings shall have been commenced against any property or any part thereof
and so long as the validity thereof shall be contested in good faith by
appropriate proceedings diligently pursued and they shall have set aside on
their consolidated books adequate reserves with respect thereto.
5.8. Notice of Events. Promptly upon discovery of any of the following
events, the Xxxx Companies shall provide telephone notice to the Banks
(confirmed within three (3) calendar days by written notice), describing the
event and all action the Xxxx Companies proposes to take with respect thereto:
(a) an Event of Default or Potential Default under this Agreement or any
other Loan Document;
(b) any default or event of default under a contract or contracts and
the default or event of default involves payments by the Xxxx Companies in an
aggregate amount equal to or in excess of $1,000,000;
(c) a default or event of default under or as defined in any evidence of
or agreements for Indebtedness for Borrowed Money under which any Xxxx Company's
or its Subsidiaries' liability is equal to or in excess of $1,000,000,
singularly or in the aggregate, whether or not an event of default thereunder
has been declared by any party to such agreement or any event which, upon the
lapse of time or the giving of notice or both, would become an event of default
under any such agreement or instrument or would permit any party to any such
instrument or agreement to terminate or suspend any commitment to lend to the
Xxxx Companies or their Subsidiaries or to declare or to cause any such
indebtedness to be accelerated or payable before it would otherwise be due;
(d) the institution of, any material adverse determination in, or the
entry of any default judgment or order or stipulated judgment or order in, any
suit, action, arbitration, administrative proceeding, criminal prosecution or
governmental investigation against the Xxxx Companies or their Subsidiaries in
which the amount in controversy is in excess of $1,000,000, singularly or in the
aggregate; or
(e) any change in the ability of the Xxxx Companies, or the ability of
any third party contemplated in ss.3.17 and ss.5.15, to timely address a Year
2000 Problem which could have a Material Adverse Effect as well as any change in
either the process toward resolution or the purported completed resolution of
any such Year 2000 Problem; or
(f) any change in any Regulation, including, without limitation, changes
in tax laws and regulations, which would have a Material Adverse Effect on the
Xxxx Companies or any of their Subsidiaries.
5.9. Inspection Rights. During regular business hours and then as often as
reasonably requested of the Xxxx Companies, permit First Union, or any
authorized officer, employee, agent, or representative of First Union to examine
and make abstracts from the records and books of account of the Xxxx Companies
and their Subsidiaries, wherever located, and to visit the properties of the
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Credit Agreement February 25, 1999
Xxxx Companies and their Subsidiaries; and to discuss the affairs, finances, and
accounts of the Xxxx Companies and their Subsidiaries with The Xxxx Group,
Inc.'s chief executive officer, any executive vice president, its chief
financial officer, treasurer, controller or (with prior written notice to any of
the listed officers) independent accountants.
5.10. Generally Accepted Accounting Principles. Maintain books and records
at all times in accordance with Generally Accepted Accounting Principles.
5.11. Compliance with Material Contracts. The Xxxx Companies and their
Subsidiaries will comply in all material respects with all obligations, terms,
conditions and covenants, as applicable, in all Debt of the Xxxx Companies or
their Subsidiaries and all instruments and agreements related thereto, and all
other instruments and agreements to which any of them is a party or by which any
of them is bound or any of their properties is affected and in respect of which
the failure to comply reasonably could have a Material Adverse Effect.
5.12. Use of Proceeds. The Xxxx Companies will use the proceeds of each
Revolving Loan only for working capital financing, capital repairs, retrofitting
and/or maintenance, to existing Vessels and other general corporate purposes.
The proceeds of each Term Loan will be used only for repairs and improvements to
the properties, real and personal, which were damaged principally as a
consequence of Hurricane Georges which occurred in September 1998 and which are
or are expected to be included in the Insurance Claims, as well as incremental
working capital financing and other general corporate purposes arising
therefrom.
5.13. Further Assurances. Do such further acts and things and execute and
deliver to the Banks such additional assignments, agreements, powers and
instruments, as any Bank may reasonably require or reasonably deem advisable to
carry into affect the purposes of this Agreement or to better assure and confirm
unto each Bank its rights, powers and remedies hereunder.
5.14. Restrictive Covenants in Other Agreements. In the event that any Xxxx
Company shall enter into or otherwise become subject to or suffer to exist any
agreement pertaining to Debt which contains financial covenants or restrictions
that are more restrictive on it than the covenants and restrictions contained in
this Agreement, each and every such financial covenant and restriction shall be
deemed incorporated herein by reference as fully as if set forth herein. Said
financial covenant or restriction shall continue in effect for so long as the
agreement containing said financial covenant or restriction shall remain in
effect, provided however, said agreement may be amended to change any said
financial covenant or restriction so long as the purpose of said amendment is
not to eliminate or avoid an event of default or to a potential default
thereunder. If and to the extent that any such financial covenant or restriction
shall be inconsistent with or otherwise be in conflict with any covenant or
restriction set forth herein (other than by reason of its being more
restrictive), the covenant or restriction contained in this Agreement shall
govern.
5.15. Year 2000 Program. The Xxxx Companies will use their best efforts to
continue to assess the risk that the computer applications they use in their
business may be unable to properly perform date sensitive functions on or after
January 1, 2000 and will promptly take all remedial action reasonably necessary
to avoid such risk. Further, it will continue to monitor Year 2000 Problems
pertaining to third parties with whom it has material contractual relationships
which problems, if not properly addressed, could have a Material Adverse Effect.
5.16. Subsidiaries. In the event that any Xxxx Company shall create or
acquire any Subsidiary after the date hereof, such Subsidiary shall become a
party to this Agreement and be subject to all terms and conditions hereof.
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Credit Agreement February 25, 1999
6. Negative Covenants
The Xxxx Companies covenant and agree, individually and collectively, that
from and after the date hereof and so long as the Aggregate Revolving Loan
Commitment or Aggregate Term Loan Commitment is in effect or any Obligation
remains unpaid or outstanding, they and each of them will not and will not
permit their Subsidiaries to:
6.1. Consolidation and Merger. (a) Dissolve, (b) adopt or enter
into any plan or agreement of liquidation, or (c) merge or consolidate with or
into any corporation or acquire all or substantially all of the assets of any
Person, unless the surviving entity is a Xxxx Company.
6.2. Liens. Create, assume or permit to exist any Lien on any of their
properties or assets, whether now owned or hereafter acquired, or upon any
income or profits therefrom, except Permitted Liens.
6.3. Guarantees. Except as set forth in Schedule 1 hereto, guarantee or
otherwise in any way become or be responsible for indebtedness or obligations
(including working capital maintenance, take-or- pay contracts) of any other
Person, contingently or otherwise, in any amounts that would exceed in the
aggregate the sum of (a) $5,000,000 and (b) the amount of all guarantees in
existence at the date hereof and set forth in Schedule 1 hereto (including
replacements or refinancings of the underlying obligations). In the event any
obligation which was the subject of a guarantee as contemplated by clause (b)
shall be terminated, the amount of said guarantee shall cease to be included in
clause (b).
6.4. Margin Stock. Use or permit any proceeds of the Loans to be used,
either directly or indirectly, for the purpose, whether immediate, incidental or
ultimate, of buying or carrying margin stock within the meaning of Regulation U
of The Board of Governors of the Federal Reserve System, as amended from time to
time.
6.5. Acquisitions and Investments. Except as permitted in xx.xx. 6.1 and
6.10, purchase or otherwise acquire (including without limitation by way of
share exchange) any part or amount of the capital stock or assets of, or make
any Investments in any other Person; or enter into any new business activities
or ventures not directly related to their present businesses; or create any
Subsidiary, except (a) they may acquire and hold stock, obligations or
securities received in settlement of debts (created in the ordinary course of
business) owing to them, and (b) they may make and own (i) Investments in
certificates of deposit or time deposits having maturities in each case not
exceeding one year from the date of issuance thereof and issued by a Bank, or
any FDIC-insured commercial bank incorporated in the United States or any state
thereof having a combined capital and surplus of not less than $150,000,000,
(ii) Investments in marketable direct obligations issued or unconditionally
guaranteed by the United States of America, any agency thereof, or backed by the
full faith and credit of the United States of America, in each case maturing
within one year from the date of issuance or acquisition thereof, (iii)
Investments in commercial paper issued by a corporation incorporated in the
United States or any State thereof maturing no more than one year from the date
of issuance thereof and, at the time of acquisition, having a rating of A-1 (or
better) by Standard & Poor's Corporation or P-1 (or better) by Xxxxx'x Investors
Service, Inc., and (iv) Investments in money market mutual funds all of the
assets of which are invested in cash or investments described in the immediately
preceding clauses (i), (ii) and (iii).
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Credit Agreement February 25, 1999
6.6. Transfer of Assets; Nature of Business. Sell, transfer, assign or
otherwise dispose of any of their assets unless such sale or disposition shall
be in the ordinary course of their businesses for value received; or discontinue
or liquidate in any material respect any substantial part of their operations or
business.
6.7. Restricted Payments.
(a) Make or pay any redemptions, repurchases, dividends or
distributions of any kind with respect to the capital stock of The Xxxx Group,
Inc., or make or pay any advances to any holder of the capital stock of The Xxxx
Group, Inc. except that as long as no Event of Default or Potential Default
shall be in existence, The Xxxx Group, Inc. may (i) pay dividends or make
distributions in any Fiscal Year ending after December 31, 1997, up to but not
exceeding, in the aggregate, an amount which is fifty percent (50%) of net
income for the immediately preceding Fiscal Year in the case of each Fiscal Year
ending after December 31, 1997 and (ii) make advances during any Fiscal Year in
anticipation of dividends or distributions for such Fiscal Year up to but not
exceeding in the aggregate, an amount which is fifty percent (50%) of net income
for such Fiscal Year measured on a quarterly basis, provided that all such
advances shall be repaid in full on or before April 1 on the next succeeding
Fiscal Year.
(b) Other than as provided in Section 6.7(a) above, make any repayment
or advance any monies to any Subsidiary or Affiliate or any officer or director
of any Subsidiary or Affiliate in respect of intercompany obligations, except
that as long as no Event of Default or Potential Default shall be in existence
repayments or advances may be made to any Subsidiary or Affiliate in the
ordinary course of the business of the applicable Xxxx Company other than
Riverfront or any Subsidiary or Affiliate created or acquired after November 17,
1998.
6.8. Accounting Change. Make or permit any change in financial accounting
policies or financial reporting practices, except as required by Generally
Accepted Accounting Principles or regulations of the Securities and Exchange
Commission, if applicable.
6.9. Transactions with Affiliates. Enter into or suffer to exist any
contract, agreement, arrangement or transaction with any Affiliate (an
"Affiliate Transaction"), or any series of related Affiliate Transactions (other
than Exempted Affiliate Transactions), (i) unless it is determined that the
terms of such Affiliate Transaction are fair and reasonable to the applicable
Xxxx Company, and no less favorable to such company, than could have been
obtained in an arm's length transaction with a non-Affiliate, (ii) if involving
consideration to either party in excess of $1,000,000 unless such Affiliate
Transaction(s) is the subject of an officers' certificate addressed and
delivered to each Bank certifying that such Affiliate Transaction (or
Transactions) has been approved by a majority of the members of the board of
directors that are disinterested in such transaction and (iii) if involving
consideration to either party in excess of $10,000,000, unless, in addition, the
applicable Xxxx Company, prior to the consummation thereof, obtains a written
favorable opinion as to the fairness of such transaction to such company from a
financial point of view from an independent investment banking firm of national
reputation or, if pertaining to a matter for which such investment banking firms
do not customarily render such opinions, an appraisal or valuation firm of
national reputation; provided, however, that clause (iii) of this ss.6.9 also
shall be applicable to any Affiliate Transaction involving consideration to
either party in excess of $5,000,000 but equal to or less than $10,000,000
unless such Affiliate Transaction is only with an Affiliate (x) engaged in
business substantially similar and related to the business then conducted by the
Xxxx Companies (as permitted under this Agreement) and (y) such Affiliate
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Credit Agreement February 25, 1999
Transaction is entered into in the ordinary course of business for purposes
customary in the Xxxx Companies' industry.
6.10. Indebtedness. Create, enter into or allow to exist any Indebtedness
for Borrowed Money of the Xxxx Companies or any of their Subsidiaries except (i)
the Loans hereunder and the Letters of Credit issued pursuant hereto, (ii)
indebtedness in existence at the date hereof and listed in Schedule 1 hereto,
and refinancing and substitutions thereof, (iii) Capitalized Lease Obligations
and/or purchase money security interests limited to assets leased, purchased, or
financed, the aggregate unpaid balance of which shall not at any time exceed the
sum of (a) $10,000,000 and (b) the unpaid amount of all such items in existence
at the date hereof and set forth in Schedule 1 hereto, (iv) performance bonds
which shall not exceed $1,000,000 in the aggregate outstanding at any time, (v)
indebtedness by and among the Xxxx Companies and (vi) operating leases entered
into after the date hereof, provided that, the aggregate payments under
operating leases which have terms of more than one year shall not at any time
exceed $1,250,000.
7. Financial Covenants
The Xxxx Companies covenant and agree, individually and collectively, that
from and after the date hereof and so long as the Aggregate Revolving Loan
Commitment or the Aggregate Term Loan Commitment is in effect or any Obligation
remains unpaid or outstanding. Riverfront shall be excluded from the following.
7.1. Minimum Adjusted Net Worth. Adjusted Net Worth will not at any time be
less than the sum of (i) $51,000,000 plus (ii) fifty percent (50%) of Adjusted
Net Income for each Fiscal Quarter ending after June 30, 1998 without deduction
for any net losses. In the event the sum of the amounts determined in accordance
with clause (ii) above on a Fiscal Quarter basis shall exceed fifty percent
(50%) of Adjusted Net Income for the Fiscal Year of which said Fiscal Quarters
are a part, minimum Adjusted Net Worth shall be reduced by the amount of such
excess effective on the date the financial statements required pursuant to ss.
shall have been received by the Banks. At all times prior to any such date(s),
minimum Adjusted Net Worth shall include the amounts determined in accordance
with clause (ii) without reduction.
7.2. Maximum Adjusted Funded Debt to Adjusted EBITDA. The ratio of Adjusted
Funded Debt to Adjusted EBITDA shall not exceed the following:
Date Ratio
Through December 31, 1998 5.75:1
January 1-March 31, 1999 5.25:1
April 1-June 30, 1999 5.00:1
July 1-September 30, 1999 4.75:1
October 1-December 31, 1999 4.50:1
January 1-March 31, 2000 4.00:1
April 1-June 30, 2000 3.75:1
July 1-September 30, 2000 3.50:1
October 1, 2000 and thereafter 3.25:1
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Credit Agreement February 25, 1999
This ratio shall be calculated as the end of each Fiscal Quarter and shall be
for the four (4) most recently ended consecutive Fiscal Quarters. Adjusted
EBITDA for Fiscal Year 1998 shall be calculated by multiplying the sum of
Adjusted EBITDA for the Fiscal Quarters ended March 31, 1998 and June 30, 1998
times two, and as soon as information for the Fiscal Quarter ended September 30,
1998 is released by multiplying the sum of Adjusted EBITDA for the Fiscal
Quarters ended March 31, 1998, June 30, 1998 and September 30, 1998 times 1.33.
7.3. Minimum Fixed Charge Coverage Ratio. The ratio of Adjusted EBITDA to
Fixed Charges will not at any time be less than the following:
Date Ratio
Through June 29, 1999 1.10:1
June 30, 1999 and thereafter 1.25:1
This ratio shall be calculated as the end of each Fiscal Quarter and shall be
for the four (4) most recently ended consecutive Fiscal Quarters. Adjusted
EBITDA for Fiscal Year 1998 shall be calculated by multiplying the sum of
Adjusted EBITDA for the Fiscal Quarters ended March 31, 1998 and June 30, 1998
times two, and as soon as information for the Fiscal Quarter ended September 30,
1998 is released by multiplying the sum of Adjusted EBITDA for the Fiscal
Quarters ended March 31, 1998, June 30, 1998 and September 30, 1998 times 1.33.
7.4. Minimum Interest Coverage. The ratio of Adjusted EBIT to Interest
Expense will not be less than the following:
Date Ratio
Through September 30, 1999 1.50:1
December 31, 1999 and thereafter 2.00:1
This ratio shall be calculated as the end of each Fiscal Quarter and shall be
for the four (4) most recently ended consecutive Fiscal Quarters. For Fiscal
Year 1998, this ratio shall be calculated by multiplying the sum of Adjusted
EBIT and Interest Expense, respectively, for the Fiscal Quarters ended March 31,
1998 and June 30, 1998 times two, and as soon as information for the Fiscal
Quarter ended September 30, 1998 is released by multiplying the sum of Adjusted
EBIT for the Fiscal Quarters ended March 31, 1998, June 30, 1998 and September
30, 1998 times 1.33.
7.5. Minimum Annualized Adjusted EBITDA. Annualized Adjusted EBITDA will
not be less than the following:
Date Adjusted EBITDA
Through September 30, 1999 $45,000,000
December 31, 1999 and thereafter $55,000,000
This amount shall be calculated as the end of each Fiscal Quarter and shall be
for the four (4) most recently ended consecutive Fiscal Quarters. Annualized
Adjusted EBITDA for Fiscal Year 1998 shall be calculated by multiplying the sum
of Adjusted EBITDA for the Fiscal Quarters ended March 31, 1998 and June 30,
1998 times two, and as soon as information for the Fiscal Quarter ended
September 30, 1998 is released by multiplying the sum of Adjusted EBITDA for the
Fiscal Quarters ended March 31, 1998, June 30, 1998 and September 30, 1998 times
1.33.
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Credit Agreement February 25, 1999
7.6. Term Loan Borrowing Base. The aggregate principal amount of Term Loans
outstanding shall not at any time exceed the Term Loan Borrowing Base or the
Aggregate Term Loan Commitment, which ever is less, provided, however, that this
covenant shall not be deemed breached if, at the time such aggregate amount
exceeds said level, within three Business Days after any Xxxx Company first has
knowledge of such excess, a prepayment of Term Loans shall be made in an amount
sufficient to assure continued compliance with this covenant in the future.
8. Default
8.1. Events of Default. The Xxxx Companies shall be in default if any one
or more of the following events (each an "Event of Default") occurs:
(a) Payments. The Xxxx Companies fail to pay any principal of or
interest on any Note when due and payable (whether at maturity, by
acceleration or otherwise) or fail to pay when it is due and payable the
administrative fee payable to First Union, or any amount payable under
any Loan Document, and such failure shall continue for a period of five
days or more.
(b) Covenants. The Xxxx Companies fail to observe or perform (1) any
term, condition or covenant set forth in ss.ss.5.2 (with respect to
corporate existence only), 5.6 and 5.15; and all sections of Articles 6
and 7 of this Agreement, as and when required, or (2) any term,
condition or covenant contained in this Agreement or any other Loan
Document other than as set forth in (1) above, as and when required and
such failure shall continue for a period of thirty (30) days or more.
(c) Representations, Warranties. Any representation or warranty made or
deemed to be made by the Xxxx Companies herein or in any Loan Document
or in any exhibit, schedule, report or certificate delivered pursuant
hereto or thereto shall prove to have been false, misleading or
incorrect in any material respect when made or deemed to have been made.
(d) Bankruptcy. Any Xxxx Company or any Subsidiary of any Xxxx Company
is dissolved or liquidated, makes an assignment for the benefit of
creditors, files a petition in bankruptcy, is adjudicated insolvent or
bankrupt, petitions or applies to any tribunal for any receiver or
trustee, commences any proceeding relating to itself under any
bankruptcy, reorganization, readjustment of debt, dissolution or
liquidation law or statute of any jurisdiction, has commenced against it
any such proceeding which remains undismissed for a period of sixty (60)
days, or indicates its consent to, approval of or acquiescence in any
such proceeding, or any receiver of or trustee for any Xxxx Company or
any Subsidiary of any Xxxx Company or any substantial part of the
property of any Xxxx Company or any Subsidiary of any Xxxx Company is
appointed, or if any such receivership or trusteeship to continues
undischarged for a period of sixty (60) days.
(e) Certain Other Defaults. Any Xxxx Company or any Subsidiary of any
Xxxx Company shall fail to pay when due any Indebtedness for Borrowed
Money, which singularly or in the aggregate exceeds $1,000,000, and such
failure shall continue beyond any applicable cure period, or any the
Xxxx Company or any Subsidiary of any Xxxx Company shall suffer to exist
any default or event of default in the performance or observance,
subject to any applicable grace period, of any agreement, term,
condition or covenant with
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Credit Agreement February 25, 1999
respect to any agreement or document relating to Indebtedness for
Borrowed Money if the effect of such default is to permit, with the
giving of notice or passage of time or both, the holders thereof, or any
trustee or agent for said holders, to terminate or suspend any
commitment (which is equal to or in excess of $1,000,000) to lend money
or to cause or declare any portion of any borrowings thereunder to
become due and payable prior to the date on which it would otherwise be
due and payable, provided that during any applicable cure period the
Bank's obligations hereunder to make further Loans shall be suspended.
(f) Judgments. Any judgments against any Xxxx Company or any Subsidiary
of any Xxxx Company or against their assets or property for amounts in
excess of $1,000,000 in the aggregate remain unpaid, unstayed on appeal,
undischarged, unbonded and undismissed for a period of thirty (30) days.
(g) Attachments. Any assets of any Xxxx Company or any Subsidiary of any
Xxxx Company shall be subject to attachments, levies, or garnishments
for amounts in excess of $1,000,000 in the aggregate which have not been
dissolved or satisfied within thirty (30) days after service of notice
thereof to the Xxxx Company or any Subsidiary.
(h) ERISA. Excluding any liability related to withdrawal from Port
Xxxxxxxxx as disclosed on Schedule 1, any Reportable Event or any other
fact or circumstance which the Bank in good faith determines constitutes
ground for the termination of any employee benefit plan maintained for
employees of any Xxxx Company or any ERISA Affiliate and covered by
Title IV of ERISA or grounds for the appointment by an appropriate
United States District Court of a trustee to administer any such plan,
shall have occurred and be continuing for five days, or any such plan
shall be terminated within the meaning of such Title IV, or a trustee
shall be appointed by the appropriate United States District Court to
administer such plan or the Pension Benefit Guaranty Corporation shall
institute proceedings to terminate any such plan or to appoint a trustee
to administer such plan, if upon the termination of the plan or plans
with respect to which any of the foregoing events shall have occurred
there is or would be, in the reasonable judgment of the Bank, a material
resultant liability of the Xxxx Companies or any ERISA Affiliate.
(i) Security Interests. Any security interest created pursuant to any
Loan Document shall cease to be in full force and effect, or shall cease
in any material respect to give First Union the Liens, rights, powers
and privileges purported to be created thereby (including, without
limitation, a perfected security interest in, and Lien on, all of the
Collateral), superior to and prior to the rights of all third Persons,
and subject to no other Liens.
(j) Material Adverse Change. There occurs any Material Adverse Change.
(k) Change in Control. Xxxxxx X. Xxxx, Xx., together with any family
trusts created by him and members of his immediate family, shall cease
to be (of record and beneficially) the owner of at least an aggregate of
51% of the issued and outstanding voting and capital stock of The Xxxx
Group, Inc.
THEN and in every such event other than those specified in clause (d) above,
First Union may, in its sole discretion, or at the written request of the
Required Banks shall, terminate the Aggregate Revolving Loan Commitment,
terminate the Aggregate Term Loan Commitment, and declare the Notes (Revolving
Notes and Term Notes) together with accrued interest thereon and all other
amounts payable under any Loan Document to be, and the same shall thereupon
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Credit Agreement February 25, 1999
become, due and payable without presentment, demand, protest or other notice of
any kind, all of which are hereby waived by the Xxxx Companies. Upon the
occurrence of any event specified in clause (d) above, the Aggregate Revolving
Loan Commitment and the Aggregate Term Loan Commitment shall automatically
terminate and the Notes (Revolving Notes and Term Notes) together with accrued
interest thereon and all other amounts payable under any Loan Document shall
immediately be due and payable without presentment, demand, protest or other
notice of any kind, all of which are hereby waived by the Xxxx Companies. From
and after the date an Event of Default shall have occurred and for so long as
any Event of Default shall be continuing, the Loans (Revolving Loans and Term
Loans) shall bear interest at the Default Rate. Upon the occurrence of an Event
of Default, in addition to the rights set forth above, First Union shall have
the immediate right to enforce or realize on any collateral security granted to
it in any manner or order it deems expedient without regard to any equitable
principles of marshaling or otherwise. In addition to any rights granted
hereunder or in any of the other Loan Documents, First Union and each Bank shall
have all the rights and remedies granted by applicable law, all of which shall
be cumulative in nature.
9. Collateral
9.1. Collateral.
(i) Revolving Loans. Except as otherwise specifically set forth herein
or in any other Loan Document, any and all Revolving Loans and Letters of Credit
made and outstanding and their repayment at all times shall be secured by a
first priority, perfected, security interest in certain assets owned by one or
more of the Xxxx Companies as listed and described in Schedule 2 attached hereto
under the caption "Revolving Loans".
(ii) Term Loans. Except as otherwise specifically set forth herein or
in any other Loan Document, any and all Term Loans made and outstanding and
their repayment at all times shall be secured by a first priority, perfected,
security interest in certain assets owned by one or more of the Xxxx Companies
as listed and described in Schedule 2 attached hereto under the caption "Term
Loans".
9.2. Release of Collateral.
(i) Revolving Loans. Upon the payment in full of the entire principal
balance of all Revolving Loans and Letters of Credit and any interest, fees and
other amounts payable under all Loan Documents, and the termination of the
Aggregate Revolving Loan Commitment, First Union shall release the lien and
security interest it holds in assets owned by one or more of the Xxxx Companies
as listed and described in Schedule 2 attached hereto under the caption
"Revolving Loans", and do such things as are reasonably requested by the Xxxx
Companies to effect such release.
(ii) Term Loans. Upon the payment in full of the entire principal
balance of all Term Loans and any interest, fees and other amounts payable under
all Loan Documents, and the termination of the Aggregate Term Loan Commitment,
First Union shall release the lien and security interest it holds in assets
owned by one or more of the Xxxx Companies as listed and described in Schedule 2
attached hereto under the caption "Term Loans", and do such things as are
reasonably requested by the Xxxx Companies to effect such release.
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Credit Agreement February 25, 1999
10. Agent
10.1. Appointment and Authorization. Each Bank hereby irrevocably appoints
and authorizes First Union, as Agent hereunder and as collateral agent and
security trustee with respect to the First Preferred Ship Mortgages and any
other Collateral, to take such action on its behalf and to exercise such powers
under this Agreement and the Loan Documents as are specifically delegated to it
as Agent by the terms hereof or thereof, together with such other powers as are
reasonably incidental thereto. The relationship between First Union and each
Bank has no fiduciary aspects, and First Union's duties as Agent hereunder are
acknowledged to be only ministerial and not involving the exercise of discretion
on its part. Nothing in this Agreement or any Loan Document shall be construed
to impose on First Union any duties or responsibilities other than those for
which express provision is made herein or therein. In performing its duties and
functions under this Article 10, First Union does not assume and shall not be
deemed to have assumed, and hereby expressly disclaims, any obligation with or
for any Xxxx Company. As to matters not expressly provided for in this Agreement
or any Loan Document, First Union shall not be required to exercise any
discretion or to take any action or communicate any notice, but shall be fully
protected in so acting or refraining from acting upon the instructions of the
Required Banks and their respective successors and assigns; provided, however,
that in no event shall First Union be required to take any action which exposes
it to individual liability or which is contrary to this Agreement, any Loan
Document or applicable law, and First Union shall be fully justified in failing
or refusing to take any action hereunder unless it shall first be specifically
indemnified to its satisfaction by the Banks against any and all liability and
expense which may be incurred by it by reason of taking or omitting to take any
such action. If an indemnity furnished to First Union for any purpose shall, in
its reasonable opinion, be insufficient or become impaired, First Union may call
for additional indemnity from the Banks and not commence or cease to do the acts
for which such indemnity is requested until such additional indemnity is
furnished.
10.2. Duties and Obligations. In performing its functions and duties
hereunder on behalf of the Banks, First Union shall exercise the same care and
skill as it would exercise in dealing with loans for its own account. Neither
First Union nor any of its directors, officers, employees or other agents shall
be liable for any action taken or omitted to be taken by it or them under or in
connection with this Agreement or any Loan Document except for its or their own
gross negligence or willful misconduct. Without limiting the generality of the
foregoing, First Union (a) may consult with legal counsel and other experts
selected by it and shall not be liable for any action taken or omitted to be
taken by it in good faith and in accordance with the advice of such experts; (b)
makes no representation or warranty to any Bank as to, and shall not be
responsible to any Bank for, any recital, statement, representation or warranty
made in or in connection with this Agreement, any Loan Document or in any
written or oral statement (including a financial or other such statement),
instrument or other document delivered in connection herewith or therewith or
furnished to any Bank by or on behalf of any Xxxx Company; (c) shall have no
duty to ascertain or inquire into any Xxxx Company's performance or observance
of any of the covenants or conditions contained herein or to inspect any of the
property (including the books and records) of any Xxxx Company or inquire into
the use of the proceeds of the Loans or (unless the officers of First Union
active in their capacity as officers of First Union on the Xxxx Companies'
account have actual knowledge thereof or have been notified in writing thereof)
to inquire into the existence or possible existence of any Event of Default or
Potential Default; (d) shall not be responsible to any Bank for the due
execution, legality, validity, enforceability, effectiveness, genuineness,
sufficiency, collectability or value of this Agreement or any other Loan
Document or any instrument or document executed or issued pursuant hereto or in
connection herewith, except to the extent that such may be dependent on the due
authorization and execution by First Union itself; (e) except as expressly
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Credit Agreement February 25, 1999
provided herein in respect of information and data furnished to First Union for
distribution to the Banks, shall have no duty or responsibility, either
initially or on a continuing basis, to provide to any Bank any credit or other
information with respect to any Xxxx Company, whether coming into its possession
before the making of the Loans or at any time or times thereafter; and (f) shall
incur no liability under or in respect of this Agreement or any other Loan
Document for, and shall be entitled to rely and act upon, any notice, consent,
certificate or other instrument or writing (which may be by facsimile
(telecopier), telegram, cable, or other electronic means) believed by it to be
genuine and correct and to have been signed or sent by the proper party or
parties.
10.3. First Union as a Bank. With respect to its Revolving Loan Commitment
and the Loans made and to be made by it, First Union shall have the same rights
and powers under this Agreement and all other Loan Documents as the other Banks
and may exercise the same as if it were not the Agent. The terms "Bank" and
"Banks" as used herein shall, unless otherwise expressly indicated, include
First Union in its individual capacity. First Union and any successor Agent
which is a commercial bank, and their respective affiliates, may accept deposits
from, lend money to, act as trustee under indentures of and generally engage in
any kind of business with, any Xxxx Company and its affiliates from time to
time, all as if such entity were not the Agent hereunder and without any duty to
account therefor to any Bank.
10.4. Independent Credit Decisions. Each Bank acknowledges to First Union
that it has, independently and without reliance upon First Union or any other
Bank, and based upon such documents and information as it has deemed
appropriate, made its own independent credit analysis and decision to enter into
this Agreement. Each Bank also acknowledges that it will, independently or
through other advisers and representatives but without reliance upon First Union
or any other Bank, and based upon such documents and information as it shall
deem appropriate at the time, continue to make its own credit decisions in
taking or refraining from taking any action under this Agreement or any Loan
Document.
10.5. Indemnification. The Banks agree to indemnify First Union (to the
extent not previously reimbursed by the Xxxx Companies or any Xxxx Company),
ratably in proportion to each Bank's Commitment Percentage, from and against any
and all liabilities, obligations, losses, damages, penalties, actions,
judgments, suits, costs, expenses and disbursements of any kind or nature
whatsoever which may be imposed on, incurred by or asserted against First Union
in its capacity as Agent in any way relating to or arising out of this Agreement
or any Loan Document or any action taken or omitted to be taken by First Union
in its capacity as Agent hereunder or under any Loan Document; provided that
none of the Banks shall be liable for any portion of such liabilities,
obligations, losses, damages, penalties, actions, judgments, suits, costs,
expenses or disbursements resulting from First Union's gross negligence or
willful misconduct. Without limiting the generality of the foregoing, each Bank
agrees to reimburse First Union, promptly on demand, for such Bank's ratable
share (based upon the aforesaid apportionment) of any out-of-pocket expenses
(including counsel fees and disbursements) incurred by First Union in connection
with the preparation, execution, administration or enforcement of, or the
preservation of any rights under, this Agreement and the Loan Documents to the
extent that First Union is not reimbursed for such expenses by the Xxxx
Companies or any Xxxx Company.
10.6. Successor Agent. First Union may resign at any time by giving written
notice of such resignation to the Banks and the Xxxx Companies, such resignation
to be effective only upon the appointment of a successor Agent as hereinafter
provided. Upon any such notice of resignation, the Banks shall
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jointly appoint a successor Agent upon written notice to the Xxxx Companies and
First Union. If no successor Agent shall have been jointly appointed by such
Banks and shall have accepted such appointment within thirty (30) days after
First Union shall have given notice of resignation, First Union may, upon notice
to the Xxxx Companies and the Banks, appoint a successor Agent. Upon its
acceptance of any appointment as Agent hereunder, the successor Agent shall
succeed to and become vested with all the rights, powers, privileges and duties
of First Union, and First Union shall be discharged from its duties and
obligations as Agent under this Agreement and the Loan Documents. After First
Union's resignation hereunder, the provisions hereof shall inure to its benefit
as to any actions taken or omitted to be taken by it while it was the Agent
under this Agreement and the Loan Documents.
10.7. Allocations Made By First Union. As between First Union and the
Banks, unless a Bank objecting to a determination or allocation made by First
Union pursuant to this Agreement delivers to First Union written notice of such
objection within one hundred twenty (120) days after the date any distribution
was made by First Union, such determination or allocation shall be conclusive on
such one hundred twentieth day and only those items expressly objected to in
such notice shall be deemed disputed by such Bank. First Union shall not have
any duty to inquire as to the application by the Banks of any amounts
distributed to them.
11. Miscellaneous
11.1. Waiver. No failure or delay on the part of First Union or any Bank or
any holder of any Note in exercising any right, power or remedy under any Loan
Document shall operate as a waiver thereof; nor shall any single or partial
exercise of any such right, power or remedy preclude any other or further
exercise thereof or the exercise of any other right, power or remedy under any
Loan Document. The remedies provided under the Loan Documents are cumulative and
not exclusive of any remedies provided by law.
11.2. Amendments. No amendment, modification, termination or waiver of any
Loan Document or any provision thereof nor any consent to any departure by the
Xxxx Companies therefrom shall be effective unless the same shall have been
approved in writing by the Required Banks, be in writing and be signed by First
Union, the Required Banks and the Xxxx Companies and then any such waiver or
consent shall be effective only in the instance and for the specific purpose for
which given, provided, however, that unanimous written consent of all of the
Banks shall be required for: (a) any increase in the amount of the Aggregate
Revolving Loan Commitment or the Aggregate Term Loan Commitment; (b) any
reduction in principal, interest, or fees payable by the Xxxx Companies under
this Agreement; (c) any extension of the Revolving Credit Termination Date, Term
Credit Termination Date or the maturity date of any Loan (Revolving Loan or Term
Loan); (d) any extension of the due date for payment of any principal, interest
or fees to be collected on behalf of the Banks; and (e) except as otherwise
expressly set forth herein, any release of all or substantially all of the
Collateral. In addition to the foregoing, none of the voting rights established
under this Section 11.2 shall be modified without the written consent of that
number of Banks which would have been required to take the action to which such
voting rights apply. No notice to or demand on the Xxxx Companies shall entitle
the Xxxx Companies to any other or further notice or demand in similar or other
circumstances.
11.3. Governing Law. The Loan Documents and all rights and obligations of
the parties thereunder shall be governed by and be construed and enforced in
accordance with the laws of the Commonwealth of Pennsylvania without regard to
Pennsylvania or federal principles of conflict of laws.
11.4. Participations and Assignments. The Xxxx Companies hereby acknowledge
and agree that any Bank may at any time with the consent of the Xxxx Group, Inc.
(which consent shall not be unreasonably withheld): (a) grant
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Credit Agreement February 25, 1999
participations in all or any portion of its Revolving Note or Term Note or of
its right, title and interest therein or in or to this Agreement (collectively,
"Participations") to any other lending office of such Bank or to any other bank,
lending institution or other entity which has the requisite sophistication to
evaluate the merits and risks of investments in Participations ("Participants");
provided, however, that: (i) all amounts payable by the Xxxx Companies hereunder
shall be determined as if such Bank had not granted such Participation; and (ii)
any agreement pursuant to which such Bank may grant a Participation: (x) shall
provide that such Bank shall retain the sole right and responsibility to enforce
the obligations of the Xxxx Companies hereunder including, without limitation,
the right to approve any amendment, modification or waiver of any provisions of
this Agreement; and (y) such participation agreement may provide that such Bank
will not agree to any modification, amendment or waiver of this Agreement
without the consent of the Participant if such modification, amendment or waiver
would reduce the principal of or rate of interest on any Revolving Loan or Term
Loan or postpone the date fixed for any payment of principal of or interest on
any Revolving Loan or Term Loan or increase the Aggregate Revolving Loan
Commitment or Aggregate Term Loan Commitment; and (b) assign any of its
obligations under this Agreement and the Loan Documents, provided it shall
retain at least $5,000,000 of the Aggregate Revolving Loan Commitment,
$2,500,000 of the Aggregate Term Loan Commitment and shall serve as agent for
all its assignees. For so long as First Union shall be the Agent, its Revolving
Loan Commitment shall be at least $15,000,000.
11.5. Captions. Captions in the Loan Documents are included for convenience
of reference only and shall not constitute a part of any Loan Document for any
other purpose.
11.6. Notices. All notices, requests, demands, directions, declarations and
other communications between the Banks and the Xxxx Companies provided for in
any Loan Document shall, except as otherwise expressly provided, be mailed by
registered or certified mail, return receipt requested, or telegraphed, or
faxed, or delivered in hand to the applicable party at its address indicated
opposite its name on the signature pages hereto. The foregoing shall be
effective and deemed received three days after being deposited in the mails,
postage prepaid, addressed as aforesaid and shall whenever sent by telegram,
telegraph or fax or delivered in hand be effective when received. Any party may
change its address by a communication in accordance herewith.
11.7. Sharing of Collections, Proceeds and Set-Offs; Application of
Payments.
(a) If any Bank, by exercising any right of set-off, counterclaim or
foreclosure against trade collateral or otherwise, receives payment of principal
or interest or other amount due on any Revolving Note or Term Note which is
greater than the percentage share of such Bank (determined as set forth below),
the Bank receiving such proportionately greater payment shall purchase such
participations in the Revolving Loans or Term Loans, as applicable, held by the
other Banks, and such other adjustments shall be made as may be required, so
that all such payments shall be shared by the Banks on the basis of their
percentage shares; provided that if all or any portion of such proportionately
greater payment of such indebtedness is thereafter recovered from, or must
otherwise be restored by, such purchasing Bank, the purchase shall be rescinded
and the purchase price restored to the extent of such recovery, but without
interest being paid by such purchasing Bank. The percentage share of each Bank
shall be based on the portion of the outstanding Revolving Loans or Term Loans,
as applicable, of such Bank (prior to receiving any payment for which an
adjustment must be made under this Section in relation to the aggregate
outstanding Revolving Loans or Term Loans, as applicable, of all the Banks. The
Xxxx Companies agree, to the fullest extent it may effectively do so under
applicable law, that any holder of a participation in a Revolving Loan, Term
Loan or reimbursement obligation, whether or not acquired pursuant to the
foregoing arrangements, may exercise rights of set-off or counterclaim and other
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Credit Agreement February 25, 1999
rights with respect to such participation as fully as if such holder of a
participation were a direct creditor of the Xxxx Companies in the amount of such
participation. If under any applicable bankruptcy, insolvency or other similar
law, any Bank receives a secured claim in lieu of a set-off to which this
Section would apply, such Bank shall, to the extent practicable, exercise its
rights in respect of such secured claim in a manner consistent with the rights
of the Banks entitled under this Section to share in the benefits of any
recovery on such secured claim. If any Bank holds both a Revolving Note and a
Term Note any payment shall be deemed to be made in respect of its Term Note
until it shall have been paid in full.
(b) If an Event of Default or Potential Default shall have occurred and
be continuing First Union and each Bank and the Xxxx Companies agree that all
payments on account of the Loans shall be applied by First Union and the Banks
as follows. If the source of payments is generated from Collateral securing the
repayment of Revolving Loans, the proceeds of such payments shall be applied in
clauses Third through Sixth first in respect of the Revolving Loans until they
shall be paid in full. If the source of payments is generated from Collateral
securing the repayment of Term Loans, the proceeds of such payments shall be
applied in clauses Third through Sixth first in respect of the Term Loans until
they shall be paid in full.
First, to First Union for any Agent fees then due and payable under this
Agreement until such fees are paid in full;
Second, to First Union for any fees, costs or expenses (including
expenses described in ss.11.8) incurred by First Union under any of the
Loan Documents or this Agreement, then due and payable and not
reimbursed by the Xxxx Companies or the Banks until such fees, costs and
expenses are paid in full;
Third, to the Banks for their percentage shares of the Commitment Fee
then due and payable under this Agreement until such fee is paid in
full;
Fourth, to the Banks for their respective shares of all costs, expenses
and fees then due and payable from the Xxxx Companies until such costs,
expenses and fees are paid in full;
Fifth, to the Banks for their percentage shares of all interest then due
and payable from the Xxxx Companies until such interest is paid in full,
which percentage shares shall be calculated by determining each Bank's
percentage share of the amounts allocated in (a) above determined as set
forth in said clause (a); and
Sixth, to the Banks for their percentage shares of the principal amount
of the Loans then due and payable from the Xxxx Companies until such
principal is paid in full, which percentage shares shall be calculated
by determining each Bank's percentage share of the amounts allocated in
(a) above determined as set forth in said clause (a).
11.8. Expenses; Indemnification. The Xxxx Companies will from time to time
reimburse First Union promptly following demand for all reasonable out-of-pocket
expenses (including the reasonable fees and expenses of legal counsel) in
connection with (i) the preparation of the Loan Documents, (ii) the making of
any Loans, and (iii) the administration of the Loan Documents. The Xxxx
Companies also will from time to time reimburse First Union and each Bank for
all out-of-pocket expenses (including the reasonable fees and expenses of legal
counsel) in connection with the enforcement of the Loan Documents. In
-43-
Credit Agreement February 25, 1999
addition to the payment of the foregoing expenses, the Xxxx Companies hereby
agree to indemnify, protect and hold First Union, each Bank and any holder of
any Note (Revolving Note or Term Note) and the officers, directors, employees,
agents, affiliates and attorneys of First Union, each Bank and each such holder
(collectively, the "Indemnitees") harmless from and against any and all
liabilities, obligations, losses, damages, penalties, actions, judgments, suits,
costs, expenses and disbursements of any kind or nature, including reasonable
fees and expenses of legal counsel, which may be imposed on, incurred by, or
asserted against such Indemnitee by the Xxxx Companies or other third parties
and arise out of or relate to this Agreement or the other Loan Documents or any
other matter whatsoever related to the transactions contemplated by or referred
to in this Agreement or the other Loan Documents; provided, however, that the
Xxxx Companies shall have no obligation to an Indemnitee hereunder to the extent
that the liability incurred by such Indemnitee has been determined by a court of
competent jurisdiction to be the result of gross negligence or willful
misconduct of such Indemnitee.
11.9. Survival of Warranties and Certain Agreements. All agreements,
representations and warranties made or deemed made herein shall survive the
execution and delivery of this Agreement, the making of the Loans hereunder and
the execution and delivery of the Notes. Notwithstanding anything in this
Agreement or implied by law to the contrary, the agreements of the Xxxx
Companies set forth in ss.ss.2.8, ss.2.9, and 11.8 shall survive the payment of
the Loans and the termination of this Agreement. This Agreement shall remain in
full force and effect until the repayment in full of all amounts owed by the
Xxxx Companies under the Notes or any other Loan Document.
11.10. Severability. The invalidity, illegality or unenforceability in any
jurisdiction of any provision in or obligation under this Agreement, the Note or
other Loan Documents shall not affect or impair the validity, legality or
enforceability of the remaining provisions or obligations under this Agreement,
the Notes or other Loan Documents or of such provision or obligation in any
other jurisdiction.
11.11. Banks' Obligations Several; Independent Nature of Banks' Rights. The
obligation of each Bank hereunder is several and not joint and no Bank shall be
the agent of any other (except to the extent the Agent is authorized to act as
such hereunder). No Bank shall be responsible for the obligation or commitment
of any other Bank hereunder. In the event that any Bank at any time should fail
to make a Loan as herein provided, the other Banks, or any of them as may then
be agreed upon, at their sole option, may make the Loan that was to have been
made by the Bank so failing to make such Loan. Nothing contained in any Loan
Document and no action taken by First Union or any Bank pursuant hereto or
thereto shall be deemed to constitute the Banks to be a partnership, an
association, a joint venture or any other kind of entity. The amounts payable at
any time hereunder to each Bank shall be a separate and independent debt, and,
subject to the terms of this Agreement, each Bank shall be entitled to protect
and enforce its rights arising out of this Agreement and it shall not be
necessary for any other Bank to be joined as an additional party in any
proceeding for such purpose.
11.12. No Fiduciary Relationship. No provision in this Agreement or in any
of the other Loan Documents and no course of dealing between the parties shall
be deemed to create any fiduciary duty by any Bank to any Xxxx Company.
11.13. CONSENT TO JURISDICTION AND SERVICE OF PROCESS. EACH XXXX COMPANY,
FIRST UNION AND EACH BANK HEREBY CONSENTS TO THE JURISDICTION OF ANY STATE OR
FEDERAL COURT LOCATED WITHIN THE EASTERN DISTRICT OF PENNSYLVANIA AND
IRREVOCABLY AGREES THAT, ANY ACTIONS OR PROCEEDINGS ARISING OUT OF OR RELATING
-44-
Credit Agreement February 25, 1999
TO THE NOTE, THIS AGREEMENT OR THE OTHER LOAN DOCUMENTS MAYBE LITIGATED IN SUCH
COURTS. EACH XXXX COMPANY, FIRST UNION AND EACH BANK ACCEPTS FOR ITSELF AND IN
CONNECTION WITH ITS PROPERTIES, GENERALLY AND UNCONDITIONALLY, THE NONEXCLUSIVE
JURISDICTION OF THE AFORESAID COURTS AND WAIVES ANY DEFENSE OF FORUM NON
CONVENIENS, AND IRREVOCABLY AGREES TO BE BOUND BY ANY JUDGMENT RENDERED THEREBY
IN CONNECTION WITH THIS AGREEMENT, ANY NOTE, OR SUCH OTHER LOAN DOCUMENT.
11.14. ARBITRATION, WAIVER OF JURY TRIAL.
(a) ARBITRATION. Upon demand of any party hereto whether made before
or after institution of any judicial proceeding, any claim or controversy
arising out of, or relating to the Loan Documents between parties hereto (a
"Dispute") shall be resolved by binding arbitration conducted under and governed
by the Commercial Financial Disputes Arbitration Rules (the "Arbitration Rules")
of the American Arbitration Association (the "AAA") and the Federal Arbitration
Act. Disputes may include, without limitation, tort claims, counterclaims a
dispute as to whether a matter is subject to arbitration, claims brought as
class actions, or claims arising from documents executed in the future. A
judgment upon the award may be entered in any court having jurisdiction.
Notwithstanding the foregoing, this arbitration provision does not apply to
disputes under or related to swap agreements.
(b) SPECIAL RULES. All arbitration hearings shall be conducted in the
City of Philadelphia, PA. A hearing shall begin within 90 days of demand for
arbitration and all hearings shall be concluded within 120 days of demand for
arbitration. These time limitations may not be extended unless a party shows
cause for extension and then for no more than a total of 60 days. The expedited
procedures set forth in Rule 51 et. seq. of the Arbitration Rules shall be
applicable to claims of less than $1,000,000. Arbitrators shall be licensed
attorneys selected from the Commercial Financial Dispute Arbitration Panel of
the AAA. The parties do not waive applicable Federal or State substantive law
except as provided herein.
(c) PRESERVATION AND LIMITATION OF REMEDIES. Notwithstanding the
preceding binding arbitration provisions, the parties agree to preserve without
diminution, certain remedies that any party may exercise before or after or
after an arbitration proceeding is brought. The parties shall have the right to
proceed in any court of proper jurisdiction or by self-help to exercise or
prosecute the following remedies, as applicable: (i) all rights to foreclose
against any real or personal property or other security by exercising a power of
sale or under applicable law by judicial foreclosure including a proceeding to
confirm the sale; (ii) all rights of self-help including peaceful occupation of
real property and collection of rents, set- off, and peaceful possession of
personal property, (iii) obtaining provisional or ancillary remedies including
injunctive relief, sequestration, garnishment, attachment, appointment of
receiver and filing an involuntary bankruptcy proceeding; and (iv) when
applicable, a judgment by confession of judgment. Any claim or controversy with
regard to any party's entitlement to such remedies is a Dispute.
The parties agree that they shall not have a remedy of punitive or
exemplary damages against the other in any Dispute and hereby waive any right or
claim to punitive or exemplary damages they have now or which may arise in the
future in connection with any Dispute, whether the Dispute is resolved by
arbitration or judicially.
-45-
Credit Agreement February 25, 1999
(d) WAIVER OF JURY TRIAL. THE PARTIES ACKNOWLEDGE THAT BY AGREEING TO
BINDING ARBITRATION THEY HAVE IRREVOCABLY WAIVED ANY RIGHT THEY MAY HAVE TO A
JURY TRIAL WITH REGARD TO A DISPUTE.
11.15. Counterparts; Effectiveness. This Agreement and any amendment hereto
or waiver hereof may be signed in any number of counterparts, each of which
shall be an original, with the same effect as if the signatures thereto and
hereto were upon the same instrument. This Agreement and any amendments hereto
or waivers hereof shall become effective when First Union shall have received
signed counterparts or notice by fax of the signature page that the counterpart
has been signed and is being delivered to it or facsimile that such counterparts
have been signed by all the parties hereto or thereto.
11.16. Use of Defined Terms. All words used herein in the singular or
plural shall be deemed to have been used in the plural or singular where the
context or construction so requires. Any defined term used in the singular
preceded by "any" shall be taken to indicate any number of the members of the
relevant class.
11.17. Offsets. Nothing in this Agreement shall be deemed a waiver or
prohibition of any Bank's right of banker's lien or offset.
11.18. Entire Agreement. This Agreement, the Notes issued hereunder and the
other Loan Documents constitute the entire understanding of the parties hereto
as of the date hereof with respect to the subject matter hereof and thereof and
supersede any prior agreements, written or oral, with respect hereto or thereto.
11.19. 1997 Credit Agreement. Simultaneously with the execution and
delivery of this Agreement on November 17, 1998, the commitment of First Union
National Bank, successor by merger with CoreStates Bank, to make loans or issue
letters of credit under the 1997 Credit Agreement was terminated, and First
Union National Bank was released in full for all matters in connection therewith
or relating thereto. This amended and restated Credit Agreement shall not affect
said termination and release. This amendment and restatement hereby confirms
said termination and release.
11.20. Consolidated Basis. Unless the context otherwise requires,
references to the Xxxx Companies in this Agreement shall mean the Xxxx Companies
and their Subsidiaries.
-46-
Credit Agreement February 25, 1999
IN WITNESS WHEREOF, the parties hereto have each caused this Agreement
to be duly executed by their duly authorized representatives as of the date
first above written.
THE XXXX GROUP, INC.
XXXX CARGO SYSTEMS, INC.
XXXX HAULING AND WAREHOUSING SYSTEM, INC.
XXXXXX MARINE SERVICES, INC.
NPR HOLDING CORPORATION, INC.
NPR, INC.
NPR-NAVIERAS RECEIVABLES, INC.
NPR S.A., INC.
SAN XXXX INTERNATIONAL TERMINALS, INC.
S.J.I.T., INC.
WILMINGTON STEVEDORES, INC.
By /s/ Xxxx X. Xxxxx
-----------------------
Name: Xxxx X. Xxxxx
Title: Vice President
Notices To:
Xx. Xxxxxxx Xxxxxx
The Xxxx Group, Inc.
000 X. Xxxx Xxxxxx
Xxxxxxxxxx Xxxx, XX 00000
FAX No. (000) 000-0000
-47-
Credit Agreement February 25, 1999
FIRST UNION NATIONAL BANK,
for itself and as agent
By: /s/ Xxx X. Xxxxx
------------------------------
Name: Xxx X. Xxxxx
Title: Vice President
Notices To:
Xxx X. Xxxxx
Vice President
First Union National Bank
Transportation and Equipment Finance
PA 4827
0000 Xxxxxxxx Xxxxxx
Xxxxxxxxxxxx, XX 00000
FAX No. 000-000-0000
SUMMIT BANK
By: /s/ Xxxx X. Xxxxxx
------------------------------
Name: Xxxx X. Xxxxxx
Title: Vice President
Notices To:
Xxxx X. Xxxxxx
Vice President
Summit Bank
0000 Xxxxxx Xxxxxx Xxxx
Xxxxxx Xxxx, XX 00000
FAX No. 000-000-0000
-48-
Credit Agreement February 25, 0000
XXXXXXXXXX XXXXX XX XXXXXXXXXXXX
By: /s/ Xxxxxx X. Xxxxxx
------------------------------
Name: Xxxxxx X. Xxxxxx
Title: Vice President
Notices To:
Xxxxxx X. Xxxxxx
Vice President
Wilmington Trust of Pennsylvania
000 Xxxx Xxxxxxxxx Xxxxxx
Xxxxxxxxx, XX 00000
FAX No. 000-000-0000
MBC LEASING CORP.
By: /s/ Xxxxx Xxxxx
------------------------------
Name: Xxxxx Xxxxx
Title: Vice President
Notices To:
Xxxxx Xxxxx
Vice President
MBC Leasing Corp.
0 Xxxxxxx Xxxxx, 0xx xxxxx
Xxxxxxxxx, XX 00000
FAX No. 000-000-0000
-49-
Credit Agreement February 25, 1999
Reference Table of Definitions
definition page defined
1995 Credit Agreement....................................................2
1997 Credit Agreement....................................................2
AAA.....................................................................46
Additional Amount.......................................................19
Adjusted EBIT............................................................2
Adjusted EBITDA..........................................................2
Adjusted Funded Debt.....................................................2
Adjusted Net Income......................................................2
Adjusted Net Worth.......................................................2
Affiliate................................................................2
Affiliate Transaction...................................................34
Aggregate Revolving Loan Commitment.....................................11
Aggregate Term Loan Commitment..........................................12
Agreement................................................................3
Arbitration Rules.......................................................46
Assignment of Insurance Claims...........................................3
Bank.....................................................................1
Banks....................................................................1
Base Rate................................................................3
Base Rate Margin.........................................................3
Business Day.............................................................3
Capital Lease............................................................3
Capitalized Lease Obligations............................................3
Cargo....................................................................1
Code.....................................................................3
Compliance Certificate...................................................3
CPLTD....................................................................3
Debt.....................................................................4
Default Rate.............................................................4
Dispute.................................................................46
Dollars..................................................................4
Environmental Control Statutes...........................................4
ERISA....................................................................4
ERISA Affiliate..........................................................4
Event of Default........................................................37
Exempt Affiliate Transaction.............................................4
Federal Funds Rate.......................................................4
First Preferred Ship Mortgage............................................5
First Union..............................................................1
Fiscal Quarter...........................................................5
Fiscal Year..............................................................5
Fixed Charges............................................................5
GAAP.....................................................................5
-50-
Credit Agreement February 25, 1999
Generally Accepted Accounting Principles.................................5
Governmental Authority...................................................5
Hauling..................................................................1
Hazardous Substances.....................................................5
Xxxx Companies...........................................................1
Xxxx Company.............................................................1
Xxxx Group...............................................................1
Indebtedness for Borrowed Money..........................................5
Indemnitees.............................................................45
Insurance Claims.........................................................5
Interest Period..........................................................5
Investment...............................................................6
Letter of Credit........................................................12
LIBO Rate................................................................6
LIBO Rate Loans..........................................................6
LIBO Rate Margin.........................................................6
LIBO Rate Reserve Percentage.............................................6
Lien.....................................................................7
Loan....................................................................11
Loan Documents...........................................................7
Loans...................................................................11
Material Adverse Change..................................................7
Material Adverse Effect..................................................7
Multiemployer Plan.......................................................7
Xxxxxx...................................................................1
Net Worth................................................................7
Note....................................................................13
Notes...................................................................13
NPR Holding..............................................................1
NPR S.A..................................................................1
NPR, Inc.................................................................1
NPR-Navieras.............................................................1
Obligations..............................................................7
Participants............................................................43
Participations..........................................................43
PBGC.....................................................................8
Pension Plan.............................................................8
Permitted Liens..........................................................8
Person...................................................................8
Plan.....................................................................8
Pledge Agreement.........................................................8
Potential Default........................................................9
Prohibited Transaction...................................................9
Regulation...............................................................9
Regulation D.............................................................9
Regulatory Change........................................................9
Release..................................................................9
Reportable event.........................................................9
-51-
Credit Agreement February 25, 1999
Request for Advance.....................................................14
Required Banks...........................................................9
Revolving Credit Termination Date.......................................14
Revolving Loan..........................................................11
Revolving Loan Commitment...............................................11
Revolving Loan Commitment Fee...........................................16
Revolving Loans.........................................................10
Revolving Note..........................................................13
Revolving Notes.........................................................13
Riverfront...............................................................1
San Xxxx.................................................................1
Security Agreement......................................................10
SJIT.....................................................................1
Solvent.................................................................10
Subsidiary..............................................................10
Taxes...................................................................10
Term Credit Termination Date............................................14
Term Loan...............................................................12
Term Loan Borrowing Base................................................40
Term Loan Commitment....................................................12
Term Loan Commitment Fee................................................17
Term Loans..............................................................12
Term Note...............................................................14
Term Notes..............................................................14
Termination Event.......................................................10
Unfunded Capital Expenditures...........................................10
Unfunded Pension Liabilities............................................11
Unrecognized Retiree Welfare Liability..................................11
Vessel..................................................................11
Wilmington...............................................................1
Year 2000 Problem.......................................................11
-52-
Credit Agreement February 25, 1999
EXHIBIT A-1
Revolving Loan Commitments and Percentages
Revolving Loan
Revolving Loan Commitment
Bank Commitment Percentage
---- ---------- ----------
First Union National Bank $25,000,000 50.00%
Transportation and Equipment Finance
0000 Xxxxxxxx Xxxxxx - 00xx Xxxxx
XX 4827
Xxxxxxxxxxxx, XX 00000
Fax No. (000) 000-0000
Summit Bank $10,000,000 20.00%
0000 Xxxxxx Xxxxxx Xxxx
Xxxxxx Xxxx, XX 00000
FAX No. 000-000-0000
Wilmington Trust of Pennsylvania $10,000,000 20.00%
000 Xxxx Xxxxxxxxx Xxxxxx
Xxxxxxxxx, XX 00000
FAX No. 000 000 0000
MBC Leasing Corp. $5,000,000 10.00%
0 Xxxxxxx Xxxxx - 0xx xxxxx
Xxxxxxxxx, XX 00000
FAX No. 000 000 0000
EXHIBIT A-2
Term Loan Commitments and Percentages
Term Loan
Term Loan Commitment
Bank Commitment Percentage
First Union National Bank $ 8,625,000 50.00%
Transportation and Equipment Finance
0000 Xxxxxxxx Xxxxxx - 00xx Xxxxx
XX 4827
Xxxxxxxxxxxx, XX 00000
Fax No. (000) 000-0000
Summit Bank $ 3,450,000 20.00%
0000 Xxxxxx Xxxxxx Xxxx
Xxxxxx Xxxx, XX 00000
FAX No. 000-000-0000
Wilmington Trust of Pennsylvania $ 3,450,000 20.00%
000 Xxxx Xxxxxxxxx Xxxxxx
Xxxxxxxxx, XX 00000
FAX No. 000 000 0000
MBC Leasing Corp. $ 1,725,000 10.00%
0 Xxxxxxx Xxxxx - 0xx xxxxx
Xxxxxxxxx, XX 00000
FAX No. 000 000 0000
EXHIBIT B-1
Revolving Note
$___,000,000 Philadelphia, PA
February 25, 1999
For Value Received, THE XXXX GROUP, INC., a Delaware corporation, XXXX CARGO
SYSTEMS, INC., a Delaware corporation, XXXX HAULING AND WAREHOUSING SYSTEM,
INC., a Pennsylvania corporation, XXXXXX MARINE SERVICES, INC., a Delaware
corporation, NPR HOLDING CORPORATION, a Delaware corporation, NPR, INC., a
Delaware corporation, NPR- NAVIERAS RECEIVABLES, INC., a Delaware corporation,
NPR S.A., Inc., a Delaware corporation, SAN XXXX INTERNATIONAL TERMINALS, INC.,
a Delaware corporation, S.J.I.T., INC., a Delaware corporation, and WILMINGTON
STEVEDORES, INC., a Delaware corporation, (together, sometimes referred to
herein as the "Xxxx Companies" and individually, as a "Xxxx Company"), jointly
and severally, hereby promise to pay to the order of __________________ (the
"Bank"), in lawful currency of the United States of America in immediately
available funds at the offices of FIRST UNION NATIONAL BANK located at Broad and
Chestnut Streets, Philadelphia, Pennsylvania, on the earlier to occur of
acceleration of the maturity date as provided in the Credit Agreement described
below or the Revolving Credit Termination Date as therein defined, the principal
sum of ____________________ MILLION DOLLARS ($___,000,000) or, if less, the then
unpaid principal amount of all Revolving Loans made by the Bank pursuant to the
Credit Agreement (defined below).
The Xxxx Companies promise also to pay interest on the unpaid principal amount
hereof in like money at such office from the date hereof until paid in full at
the rates and at the times provided in the Credit Agreement, dated February 25,
1999, by and among the Xxxx Companies and the bank institutions named therein,
with First Union National Bank as Agent (as such may be amended, modified,
supplemented, restated or replaced from time to time, the "Credit Agreement").
This Note is a Revolving Note referred to in the Credit Agreement. This Note is
entitled to the benefits of and is secured by security interests referred to in
the Credit Agreement. Capitalized terms used in this Note but not defined herein
shall have the meanings ascribed to such terms in the Credit Agreement. This
Note is subject to voluntary prepayment and mandatory repayment prior to demand,
acceleration of maturity or the Revolving Credit Termination Date, in whole or
in part, as provided in the Credit Agreement.
In case an Event of Default shall occur and be continuing, the maturity date of
the principal of and the accrued interest on this Note may be accelerated and be
declared to be due and payable in the manner and with the effect provided in the
Credit Agreement.
The Xxxx Companies hereby waive presentment, demand, protest or notice of any
kind in connection with this Note.
Notwithstanding the face amount of this Note, the Xxxx Companies liability
hereunder shall be limited, at all times, to the actual aggregate outstanding
indebtedness to the Bank relating to the Bank's Loans, including all principal
and interest, together with all fees and expenses as provided in the Credit
Agreement, as established by the Bank's books and records which shall be
conclusive absent manifest error.
-1-
Revolving Note February 25, 1999
THIS NOTE SHALL BE CONSTRUED IN ACCORDANCE WITH AND BE GOVERNED BY THE LAW OF
THE COMMONWEALTH OF PENNSYLVANIA WITHOUT REGARD TO PENNSYLVANIA OR FEDERAL
PRINCIPLES OR CONFLICT OF LAWS.
IN WITNESS WHEREOF, and intending to be legally bound hereby, each of the Xxxx
Companies has caused this Note to be executed by its duly authorized officer as
of the date and year first above written.
THE XXXX GROUP, INC.
XXXX CARGO SYSTEMS, INC.
XXXX HAULING AND WAREHOUSING SYSTEM, INC.
XXXXXX MARINE SERVICES, INC.
NPR HOLDING CORPORATION, INC.
NPR, INC.
NPR-NAVIERAS RECEIVABLES, INC.
NPR S.A., INC.
SAN XXXX INTERNATIONAL TERMINALS, INC.
S.J.I.T., INC.
WILMINGTON STEVEDORES, INC.
By
------------------------------
Name:
Title:
-2-
Revolving Note February 25, 1999
EXHIBIT B-2
Term Note
$___,000,000 Philadelphia, PA
February 25, 1999
For Value Received, THE XXXX GROUP, INC., a Delaware corporation, XXXX CARGO
SYSTEMS, INC., a Delaware corporation, XXXX HAULING AND WAREHOUSING SYSTEM,
INC., a Pennsylvania corporation, XXXXXX MARINE SERVICES, INC., a Delaware
corporation, NPR HOLDING CORPORATION, a Delaware corporation, NPR, INC., a
Delaware corporation, NPR-NAVIERAS RECEIVABLES, INC., a Delaware corporation,
NPR S.A., Inc., a Delaware corporation, SAN XXXX INTERNATIONAL TERMINALS, INC.,
a Delaware corporation, S.J.I.T., INC., a Delaware corporation, and WILMINGTON
STEVEDORES, INC., a Delaware corporation, (together, sometimes referred to
herein as the "Xxxx Companies" and individually, as a "Xxxx Company"), jointly
and severally, hereby promise to pay to the order of __________________ (the
"Bank"), in lawful currency of the United States of America in immediately
available funds at the offices of FIRST UNION NATIONAL BANK located at Broad and
Chestnut Streets, Philadelphia, Pennsylvania, on the earlier to occur of
acceleration of the maturity date as provided in the Credit Agreement described
below or the Term Credit Termination Date as therein defined, the principal sum
of ____________________ MILLION DOLLARS ($___,000,000) or, if less, the then
unpaid principal amount of all Term Loans made by the Bank pursuant to the
Credit Agreement (defined below).
The Xxxx Companies promise also to pay interest on the unpaid principal amount
hereof in like money at such office from the date hereof until paid in full at
the rates and at the times provided in the Credit Agreement, dated February 25,
1999, by and among the Xxxx Companies and the bank institutions named therein,
with First Union National Bank as Agent (as such may be amended, modified,
supplemented, restated or replaced from time to time, the "Credit Agreement").
This Note is a Term Note referred to in the Credit Agreement. This Note is
entitled to the benefits of and is secured by security interests referred to in
the Credit Agreement. Capitalized terms used in this Note but not defined herein
shall have the meanings ascribed to such terms in the Credit Agreement. This
Note is subject to voluntary prepayment and mandatory repayment prior to demand,
acceleration of maturity or the Term Credit Termination Date, in whole or in
part, as provided in the Credit Agreement.
In case an Event of Default shall occur and be continuing, the maturity date of
the principal of and the accrued interest on this Note may be accelerated and be
declared to be due and payable in the manner and with the effect provided in the
Credit Agreement.
The Xxxx Companies hereby waive presentment, demand, protest or notice of any
kind in connection with this Note.
Notwithstanding the face amount of this Note, the Xxxx Companies liability
hereunder shall be limited, at all times, to the actual aggregate outstanding
indebtedness to the Bank relating to the Bank's Loans, including all principal
and interest, together with all fees and expenses as provided in the Credit
Agreement, as established by the Bank's books and records which shall be
conclusive absent manifest error.
-1-
Term Note February 25, 1999
THIS NOTE SHALL BE CONSTRUED IN ACCORDANCE WITH AND BE GOVERNED BY THE LAW OF
THE COMMONWEALTH OF PENNSYLVANIA WITHOUT REGARD TO PENNSYLVANIA OR FEDERAL
PRINCIPLES OR CONFLICT OF LAWS.
IN WITNESS WHEREOF, and intending to be legally bound hereby, each of the Xxxx
Companies has caused this Note to be executed by its duly authorized officer as
of the date and year first above written.
THE XXXX GROUP, INC.
XXXX CARGO SYSTEMS, INC.
XXXX HAULING AND WAREHOUSING SYSTEM, INC.
XXXXXX MARINE SERVICES, INC.
NPR HOLDING CORPORATION, INC.
NPR, INC.
NPR-NAVIERAS RECEIVABLES, INC.
NPR S.A., INC.
SAN XXXX INTERNATIONAL TERMINALS, INC.
S.J.I.T., INC.
WILMINGTON STEVEDORES, INC.
By
-----------------------------
Name:
Title:
-2-
Term Note February 25, 1999
Exhibit C
FIRST PREFERRED SHIP MORTGAGE
-1-
First Preferred Ship Mortgage November, 1998
Exhibit D
PLEDGE AGREEMENT
-1-
Pledge Agreement November, 1998
Exhibit E
ACCOUNTS AND GENERAL INTANGIBLES
SECURITY AGREEMENT
This Security Agreement (the "Agreement"), dated February 25, 1999, is made
by THE XXXX GROUP, INC., a Delaware corporation ("Xxxx Group"), XXXX CARGO
SYSTEMS, INC., a Delaware corporation ("Cargo"), XXXX HAULING AND WAREHOUSING
SYSTEM, INC., a Pennsylvania corporation ("Hauling"), XXXXXX MARINE SERVICES,
INC., a Delaware corporation ("Xxxxxx"), NPR HOLDING CORPORATION, a Delaware
corporation ("NPR Holding"), NPR, INC., a Delaware corporation ("NPR, Inc."),
NPR-NAVIERAS RECEIVABLES, INC., a Delaware corporation ("NPR-Navieras"), NPR
S.A., Inc., a Delaware corporation ("NPR S.A."), SAN XXXX INTERNATIONAL
TERMINALS, INC., a Delaware corporation ("San Xxxx"), S.J.I.T., INC., a Delaware
corporation ("SJIT"), and WILMINGTON STEVEDORES, INC., a Delaware corporation
("Wilmington"), (together, sometimes referred to herein as the "Debtors" and
individually, as a "Debtor"), in favor of FIRST UNION NATIONAL BANK (the
"Secured Party"), as agent for itself and on behalf of each of the banks now or
hereafter party to the Credit Agreement (defined below). All references in this
Agreement to "Secured Party" shall mean First Union National Bank as agent for
itself and the other Banks under the Credit Agreement. All capitalized terms not
defined in this Agreement shall have the meanings assigned to them in the Credit
Agreement.
Preliminary Statement
This Security Agreement is entered into in accordance with and is a
condition precedent to any Loan under the Credit Agreement.
Agreement
Each Debtor and the Secured Party, intending to be legally bound, agree as
follows:
1. Definitions.
As used herein the following terms shall have the meanings indicated:
(a) "Accounts", "General Intangibles", "Instruments" and "Proceeds" shall
have the meanings assigned to them under the Uniform Commercial Code as in
effect in the Commonwealth of Pennsylvania and shall be applicable solely for
purposes of the Collateral.
(b) "Collateral" means all, (i) Accounts and General Intangibles related to
said Accounts, (ii) all right, title and interest in and to American
International Insurance Company of Puerto Rico insurance policy No. 026-16761,
for the period July 1, 1998 through July 1, 1999, (iii) existing and future
books and records and other General Intangibles relating to all of the
foregoing, and (iv) Proceeds of any of the foregoing.
-1-
Security Agreement February 25, 1999
(c) "Credit Agreement" means that certain Credit Agreement, dated February
25, 1999, (as such agreement may be amended, restated, modified, replaced or
substituted hereafter) by and among the Debtors and certain banking institutions
named therein, with First Union National Bank, as Agent.
(d) "Insurance Policy" means American International Insurance Company of
Puerto Rico insurance policy No. 026-16761, for the period July 1, 1998 through
July 1, 1999.
(e) "Liabilities" means all existing and future indebtedness and other
liabilities, absolute or contingent, direct or indirect, primary or secondary,
of the Debtors and any of them to the Banks, arising hereunder or in respect of
the Term Notes plus all obligations of the Debtor to the Secured Party in
respect of any interest rate swap agreement, interest rate cap agreement,
interest collar agreement, interest rate hedging agreement, interest rate floor
agreement or other similar agreement or arrangement which relates to the Term
Notes. The term "Liabilities" shall not include indebtedness or other
liabilities which relate only to the Revolving Notes.
(f) "Prevailing Interest Rate" as of any date means the highest rate of
interest then payable by the Debtors under any Term Loan.
2. Grant of Security.
To secure the payment, promptly when due, and the punctual performance
of all of the Liabilities, the Debtors and each of them hereby pledges and
assigns to the Secured Party, and grants to the Secured Party and agrees that
the Secured Party shall have, a general continuing lien upon and security
interest in all the Collateral, which lien and security interest shall be a
general continuing first priority lien upon and security interest in all the
Collateral.
3. Books and Records.
(a) Each Debtor shall faithfully keep complete and accurate books and
records and make all necessary entries therein to reflect the events and
transactions giving rise to any of the Collateral and all payments, credits and
adjustments applicable thereto, shall keep the Secured Party fully and
accurately informed as to the locations of all such books and records and shall
permit the Secured Party's agents to have such access to them and to any other
records pertaining to the Debtor's business as the Secured Party may request
from time to time in accordance with ss.5.9 of the Credit Agreement. If
requested by the Secured Party and if a Potential Default or Event of Default
hereunder or under the Credit Agreement shall exist, each Debtor will make
copies of such books and records and deliver such to the Secured Party,
promptly, or, in the alternative, permit the Secured Party from time to time to
remove such books and records from the Debtor's place of business or from any
other place where they may be found for the purpose of examining, auditing and
copying them. Any of such books or records so removed by the Secured Party's
agents shall be returned to the Debtor as soon as the Secured Party shall have
completed its inspection, audit or copying of them.
(b) The Secured Party's rights to take possession of such books and records
shall be enforceable by an action of replevin or by any other appropriate remedy
at law or in equity, and each Debtor consents to the entry of judicial orders
and injunctions enforcing such rights.
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Security Agreement February 25, 1999
4. Title to Collateral.
(a) Each Debtor has acquired or shall acquire absolute and exclusive title
to each and every item of the Collateral free and clear of all liens, claims,
security, interests and other encumbrances, except those in favor of the Secured
Party and Permitted Liens as defined in the Credit Agreement, and each Debtor
shall warrant and defend its title to the Collateral, subject to the rights of
the Secured Party, against the claims and demands of all persons whomsoever.
Without limiting the generality of the foregoing, no Debtor shall pledge, assign
or otherwise encumber, or permit any liens or security interests (other than
those in favor of the Secured Party) to attach to, any of the Collateral, nor
permit any of the Collateral to be levied upon under any legal process.
(b) Upon any breach of the foregoing covenant against encumbrances, the
Secured Party may, at its sole election but without obligation to do so,
discharge the encumbrance for the account of and without notice to any Debtor,
and all expenses incurred by the Secured Party in so doing, together with
interest thereon at the Prevailing Interest Rate, shall be added to the
Liabilities and shall be payable by the Debtors on demand.
5. Taxes and Liens. Each Debtor shall promptly notify the Secured Party in
the event there ever arises against any of the Collateral any lien, assessment
or tax or other liability, whether or not entitled to priority over the Secured
Party's security interest hereunder. In any such event, whether or not such
notice is given, the Secured Party shall have the right (but shall be under no
obligation) to pay any tax or other liability of the Debtor deemed by the
Secured Party in good faith to affect the Secured Party's interests hereunder.
The Debtor shall repay to the Secured Party on demand all sums which the Secured
Party shall have paid under this section in respect of taxes or other
liabilities of the Debtor, with interest thereon at the Prevailing Interest
Rate, and the Debtor's liability to the Secured Party for such repayment with
interest shall be included in the Liabilities. The Secured Party shall be
subrogated to the extent of any such payment by it to all the rights and liens
of the payee against the Debtor's assets.
6. Collection of Accounts, Etc.
(a) Until otherwise notified by the Secured Party, each Debtor may collect
all the Accounts but the Proceeds of all Accounts so collected by the Debtor
shall be held by the Debtor in trust for the Secured Party. The Secured Party
may at any time during the existence of an Event of Default terminate the
authority hereby given to any Debtor to collect the Proceeds of such Accounts
and, acting if it so chooses in the Debtor's name, collect such Accounts itself,
directly or through an agent, sell, assign, compromise, discharge or extend the
time for payment of such Accounts, institute legal action for the collection of
such Accounts and do all acts and things necessary or incidental thereto, and
each Debtor hereby ratifies all that the Secured Party shall lawfully do under
the authority hereby granted to it. Prior to the first such action permitted
hereunder by the Secured Party, the Secured Party shall furnish written notice
of such action to the Debtor. Thereafter, no further notices shall be required.
The Secured Party may at any time during the existence of an Event of Default,
without notice to any Debtor except the notice of first action stated above,
notify any account debtor on any such Account that such Account has been
assigned to the Secured Party and is to be paid directly to the Secured Party.
Alternatively during the existence of an Event of Default, at its election the
Secured Party may require each Debtor to, and in such event the Debtor at its
sole expense will, notify its account debtors that payments thereon are
thenceforth to be made directly to the Secured Party. Without the written
consent of the Secured Party in each case, no Debtor shall compromise,
discharge, extend the time for payment of or otherwise grant any indulgence or
allowance with respect to any such Account except for indulgences or allowances
in the ordinary course of business which are not related to an extension or
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Security Agreement February 25, 1999
restructuring of credit to an account debtor. Notwithstanding the foregoing, all
payments and proceeds with respect to the Insurance Policy shall be paid
directly and immediately to the Security Party until the Term Loans have been
paid in full. Thereafter all payments and proceeds with respect to the Insurance
Policy shall be paid to the Debtors.
(b) If any such Account arises out of a contract with the United States or
any department, agency or instrumentality thereof, the applicable Debtor will
immediately so notify the Secured Party in writing and will execute all
instruments and take all steps required by the Secured Party in order that the
security interest of the Secured Party hereunder in all such Accounts under such
contract and the Proceeds thereof shall be perfected under the Federal
Assignment of Claims Act.
(c) From and after the occurrence and during the continuance of any Event
of Default, if any of the Collateral is or becomes evidenced by a promissory
note, draft, trade acceptance, chattel paper, instrument or document of title,
each Debtor will promptly deliver the same to the Secured Party appropriately
endorsed to the Secured Party's order. Regardless of the form of such
endorsement, the Debtor hereby waives presentment, demand, notice of dishonor,
protest and notice of protest and all other notices with respect thereto. Each
Debtor will promptly notify the Secured Party of any material adverse change of
which it has knowledge in the financial condition of any account debtor on any
material Account pertaining to a Lease or in the collectibility of any of such
Accounts, and of all claims, rejections, returns and adjustments which may
result in a material reduction of the liability of an account debtor on any such
Account.
7. Locations of the Collateral; Name.
(a) If any of a Debtor's records concerning any of the Collateral are at
any time to be located on premises leased by the Debtor, or any premises owned
by the Debtor subject to a mortgage or other lien, the Debtor shall obtain and
deliver to the Secured Party, prior to the delivery of any such Collateral or
books or records to such premises, an agreement in form satisfactory to the
Secured Party waiving the landlord's, mortgagee's or other lienholder's right to
enforce against the Collateral or the Debtor's records concerning the same and
assuring the Secured Party's access to such Collateral and books and records to
facilitate the Secured Party's exercise of its rights to take possession
thereof. The location of each Debtor's chief executive office and all locations
at which each Debtor maintains books and records relating to the Collateral is
as set forth in Exhibit A hereto. Each Debtor agrees to provide the Secured
Party annually with a list of each location of any new or additional place of
business.
(b) Each Debtor represents and warrants that at no time during the past
five (5) years has it been known by or used any other name, including any trade
or fictitious name, except as set forth in Exhibit A hereto.
8. Further Assurances. Each Debtor shall continue to conduct its business
in substantially the manner heretofore conducted and will make no material
changes therein which might impair the security of the Secured Party. Each
Debtor shall execute and deliver to the Secured Party from time to time all such
other agreements, instruments and other documents (including without limitation
all requested financing and continuation statements) and do all such other and
further acts and things as the Secured Party may reasonably request in order to
further evidence or carry out the intent of this Agreement or to perfect the
liens and security interests created hereby or intended so to be.
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Security Agreement February 25, 1999
9. Default and Remedies.
(a) Each Debtor shall be in default hereunder upon the occurrence of any
one of the following events (each an "Event of Default"):
(i) any Debtor shall fail to pay any amount payable in respect of any
Liability when due (including the expiration of any applicable
grace periods).
(ii) any representation, warranty or information herein, heretofore or
hereafter furnished to the Secured Party by any Debtor in
connection with any of the Liabilities, including any warranty
made by the Debtor through the submission of any schedule,
statement, certificate or other document pursuant to or in
connection with this Agreement, shall be false in any material
respect.
(iii) there shall exist any Event of Default as defined under the
Credit Agreement.
(b) Upon the occurrence of any Event of Default which shall be continuing,
(i) unless the Secured Party elects otherwise, the entire unpaid amount of such
of the Liabilities as is not then otherwise due and payable shall become
immediately due and payable without notice to or demand on any Debtor, (ii) the
Secured Party or its agents may enter each Debtor's premises to exercise the
Secured Party's right to take possession of any Collateral, and (iii) the
Secured Party may at its option exercise from time to time any and all rights
and remedies available to it under the Uniform Commercial Code or otherwise,
including the right to assemble or foreclose or otherwise realize upon any of
the Collateral and to dispose of any of the Collateral at one or more public or
private sales or other proceedings. Each Debtor agrees that the Secured Party or
its nominee may become the purchaser at any such sale or sales. Each Debtor
further agrees that ten (10) days shall be reasonable prior notice of the date
of any public sale or other disposition of all or any part of the Collateral, or
of the date on or after which any private sale or other disposition of the same
may be made.
(c) The exercise by the Secured Party of any one right or remedy shall not
be deemed a waiver or release of or any election against any other right or
remedy, and the Secured Party may proceed against each Debtor and the Collateral
and any other collateral granted by each Debtor to the Secured Party under any
other agreement, all in any order and through any available remedies. A waiver
on any one occasion shall not be construed as a waiver or bar on any future
occasion. All property of any kind held at any time by the Secured Party as
Collateral shall stand as one general continuing collateral security for all the
Liabilities and may be retained by the Secured Party as security until all the
Liabilities are fully satisfied. Each Debtor shall pay to the Secured Party on
demand any and all expenses (including reasonable attorneys' fees and legal
expenses) which may have been incurred by the Secured Party with interest at the
Prevailing Interest Rate (i) in the prosecution or defense of any action growing
out of or connected with the subject matter of this Agreement, the Liabilities,
the Collateral or any of the Secured Party's rights therein or thereto; or (ii)
in connection with the custody, preservation, use, operation, preparation for
sale or sale of any of the Collateral, the incurring of all of which are hereby
authorized to the extent the Secured Party deems the same advisable. Each
Debtor's liability to the Secured Party for any such payment with interest shall
be included in the Liabilities. The Proceeds of any Collateral received by the
Secured Party at any time before or after default, whether from a sale or other
disposition of Collateral or otherwise, or the Collateral itself, may be applied
to the payment in full or in part of such of the Liabilities and in such order
and manner as the Secured Party may elect. Each Debtor to the extent of its
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Security Agreement February 25, 1999
rights in the Collateral waives and releases any right to require the Secured
Party to collect any of the Liabilities from any other of the Collateral or any
other collateral then held by the Secured Party under any theory of marshaling
of assets or otherwise.
10. Power of Attorney. Each Debtor hereby irrevocably appoints any officer,
employee or agent of the Secured Party as the Debtor's true and lawful
attorney-in-fact with power to (i) endorse the Debtor's name upon any notes,
checks, drafts, money orders, or other instruments or payments or other
Collateral that may come into the Secured Party's possession; (ii) sign and
endorse the Debtor's name upon any documents of title, invoices, freight or
express bills, assignments, verifications and notices in connection with any of
the Collateral, and any instruments or documents relating thereto or to the
Debtor's rights therein; and (iii) execute in the Debtor's name and file one or
more financing, amendment and continuation statements covering the Collateral.
Any such attorney of the Debtor shall have full power to do any and all things
necessary to be done with respect to the above transactions as fully and
effectually as the Debtor might do, and the Debtor hereby ratifies all that said
attorney shall lawfully do or cause to be done by virtue hereof. Unless an Event
of Default shall exist, the Secured Party shall not exercise the foregoing power
of attorney with respect to the actions contemplated in clauses (i) and (ii)
above except with respect to proceeds relating to the Insurance Policy.
11. Financing Statements. Each Debtor shall execute all financing
statements and amendments thereto as the Secured Party may request from time to
time to evidence the security interest granted to the Secured Party hereunder
and will pay all filing fees and taxes, if any, necessary to effect the filing
thereof. Wherever permitted by law, each Debtor authorizes the Secured Party to
file financing statements with respect to the Collateral without the signature
of the Debtor. A copy of this Agreement or a copy of any financing statement
prepared in connection with this Agreement may itself be filed as a financing
statement.
12. Miscellaneous.
(a) This Agreement shall commence on the date hereof and shall continue in
full force and effect so long as any of the Liabilities or any Term Loan
Commitment shall exist from time to time.
(b) No modification or waiver of any provision hereof shall be effective
unless the same is in writing and signed by the party against whom its
enforcement is sought. This Agreement and any amendment hereto or waiver of any
provision hereof may be signed in any number of counterparts with the same
effect as if the signatures thereto and hereto were upon the same instrument.
(c) The representations, warranties, covenants and agreements contained
herein are all material and continuing, and any breach of them shall constitute
a material breach of this Agreement.
(d) All the rights and remedies of the Secured Party hereunder shall be
concurrent and cumulative with and not alternative to or in lieu of the Secured
Party's rights and remedies under any other agreement or agreements.
(e) This Agreement shall bind and inure to the benefit of the parties and
their respective successors and assigns, except that no Debtor shall assign any
of its rights hereunder without the Secured Party's prior written consent.
(f) Any provision of this Agreement which is prohibited or unenforceable in
any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of
such prohibition or unenforceability without invalidating the remaining
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Security Agreement February 25, 1999
provisions hereof or affecting the validity or enforceability of such provision
in any other jurisdiction.
(g) No persons other than the Debtors and the Secured Party, and the
assignees of the Secured Party, are intended to be benefitted hereby or shall
have any rights hereunder, as third-party beneficiaries or otherwise.
(h) Each Debtor acknowledges that this Agreement and the obligations of it
hereunder and the security created or intended to be created hereby have
constituted, and were intended by it to constitute, a material inducement to the
Secured Party to enter into the Credit Agreement and other agreements referred
to therein, knowing that the Secured Party will rely upon this Agreement. Each
Debtor intends to be legally bound hereby.
(i) This Agreement shall be deemed to be a contract made under and shall be
construed in accordance with the laws of the Commonwealth of Pennsylvania
without regard to Pennsylvania or federal principles of conflict of laws.
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Security Agreement February 25, 1999
IN WITNESS WHEREOF, the parties hereto have each caused this Agreement
to be duly executed by their duly authorized representatives as of the date
first above written.
DEBTORS
THE XXXX GROUP, INC.
XXXX CARGO SYSTEMS, INC.
XXXX HAULING AND WAREHOUSING SYSTEM, INC.
XXXXXX MARINE SERVICES, INC.
NPR HOLDING CORPORATION, INC.
NPR, INC.
NPR-NAVIERAS RECEIVABLES, INC.
NPR S.A., INC.
SAN XXXX INTERNATIONAL TERMINALS, INC.
S.J.I.T., INC.
WILMINGTON STEVEDORES, INC.
By
-------------------------------
Name:
Title:
Notices To:
Xx. Xxxxxxx Xxxxxx
The Xxxx Group, Inc.
000 X. Xxxx Xxxxxx
Xxxxxxxxxx Xxxx, XX 00000
FAX No. (000) 000-0000
-8-
Security Agreement February 25, 1999
SECURED PARTY
FIRST UNION NATIONAL BANK,
Agent
By:
------------------------------
Name: Xxx X. Xxxxx
Title: Vice President
Notices To:
Xxx X. Xxxxx
Vice President
First Union National Bank
Transportation and Equipment Finance
PA 4827
0000 Xxxxxxxx Xxxxxx
Xxxxxxxxxxxx, XX 00000
FAX No. 000-000-0000
-9-
Security Agreement February 25, 1999
Exhibit A to Security Agreement
1. None of the books and records relating to any of the Collateral is
or will be located at any location other than the following:
Name of Debtor Address (including county)
The Xxxx Group, Inc. 000 Xxxxx Xxxx Xxxxxx
Xxxx Cargo Systems, Inc. Xxxxxxxxxx Xxxx, XX 00000
Xxxx Hauling and Warehousing System, Inc. (Camden County)
Xxxxxx Marine Services, Inc.
NPR Holding Corporation
NPR, Inc.
NPR-Navieras Receivables, Inc.
NPR S.A.
San Xxxx International Terminals, Inc.
S.J.I.T., Inc.
Wilmington Stevedores, Inc.
2. The location of each Debtor's chief executive office is as follows:
Name of Debtor Address (including county)
The Xxxx Group, Inc. 000 Xxxxx Xxxx Xxxxxx
Xxxx Cargo Systems, Inc. Xxxxxxxxxx Xxxx, XX 00000
Xxxx Hauling and Warehousing System, Inc. (Camden County)
Xxxxxx Marine Services, Inc.
San Xxxx International Terminals, Inc.
S.J.I.T., Inc.
Wilmington Stevedores, Inc.
NPR Holding Corporation 000 Xxxxxxxx Xxxxxx
XXX, Inc. Xxxxxx, XX 00000
NPR-Navieras Receivables, Inc. (Middlesex County)
NPR S.A.
3. During the past five years no Debtor has used or been known by any
other name, including any trade or fictitious name.
-10-
Security Agreement February 25, 1999
Exhibit F
ASSIGNMENT OF INSURANCE POLICY AND PROCEEDS
The Xxxx Group, Inc., Xxxx Cargo Systems, Inc., Xxxx Hauling and
Warehousing System, Inc., Xxxxxx Marine Services, Inc., NPR Holding Corporation,
NPR, Inc., NPR-Navieras Receivables, Inc., NPR S.A., San Xxxx International
Terminals, Inc., S.J.I.T., Inc., Wilmington Stevedores, Inc. (collectively, the
"Xxxx Entities") have entered into a Credit Agreement (the "Agreement") with
certain banking institutions named therein (the "Banks"), with First Union
National Bank as agent. NPR, Inc. and Xxxx Oversight and Logistical Technologies
and their affiliated, subsidiary, and associated companies are the named
insureds under American International Insurance Company of Puerto Rico (the
"Insurer") insurance policy No. 026-16761, for the period July 1, 1998 through
July 1, 1999 (the "Policy"). The Agreement as it is to be amended and restated
requires that all interest of NPR and any other person with respect to claims
under the Policy be assigned to First Union National Bank, as agent, to secure
the obligations of the Xxxx Entities under the Agreement.
Xxxx Oversight and Logistical Technologies and the Xxxx Entities do hereby
assign to First Union National Bank (as agent for the Banks), for good and
valuable consideration, receipt of which is hereby acknowledged, all of their
right, title and interest in and to (i) the Policy and (ii) any proceeds
thereof. This Assignment of Insurance Policy and Proceeds (this "Assignment")
shall remain in effect until First Union National Bank (as agent for the Banks)
notifies the Insurer, the Xxxx Entities, and Xxxx Oversight and Logistical
Technologies in writing that this Assignment is terminated.
THE XXXX GROUP, INC.
XXXX CARGO SYSTEMS, INC.
XXXX HAULING AND WAREHOUSING SYSTEM, INC.
XXXXXX MARINE SERVICES, INC.
NPR HOLDING CORPORATION, INC.
NPR, INC.
NPR-NAVIERAS RECEIVABLES, INC.
NPR S.A., INC.
SAN XXXX INTERNATIONAL TERMINALS, INC.
S.J.I.T., INC.
WILMINGTON STEVEDORES, INC.
By:
---------------------------------------
Name:
Title:
XXXX OVERSIGHT AND LOGISTICAL TECHNOLOGIES
By:
---------------------------------------
Name:
Title:
ACKNOWLEDGMENT AND AGREEMENT
The Insurer hereby acknowledges the assignment by the insureds under the Policy
as set forth above and agrees that it will from and after the date hereof remit
all amounts paid with respect to claims under the Policy to First Union National
Bank, as agent, at
First Union National Bank
Transportation and Equipment Finance
0000 Xxxxxxxx Xxxxxx, Xxxxxxxxxxxx, XX 00000
Attn: Xxx X. Xxxxx, Vice President
until it receives written notice from First Union National Bank addressed to it
at ___________________________________________________ that this Agreement has
been terminated by First Union National Bank, as agent.
AMERICAN INTERNATIONAL INSURANCE
COMPANY OF PUERTO RICO
By:
-----------------------------------
Name:
Title:
Subscribed and sworn to before me this ___ day of _________, 1999.
------------------------------
Notary Public
My commission expires:
Schedule 1
DISCLOSURE SCHEDULE
-1-
Schedule 1 February 25, 1999
Schedule 2
COLLATERAL SCHEDULE
-------------------------------------------------------------------------------
ASSETS SECURING REVOLVING LOANS:
A. The whole of five United States Registered Vessels:
1. S.S. Carolina, Official Number 530999
2. S.S. Guayama, Official Number 520694
3. S.S. Humacao, Official Number 514261
4. S.S. Mayaguez, Official Number 517450
5. S.S. Nuevo San Xxxx, Official Number 529004
B. Assignment of Insurances, dated November 17, 1998.
C. All of the issued and outstanding capital stock of:
1. NPR Holding Corporation
2. NPR, Inc.
3. NPR-Navieras Receivables, Inc.
4. NPR, S.A.
-------------------------------------------------------------------------------
ASSETS SECURING TERM LOANS:
A. All Accounts and related General Intangibles of each of
the Xxxx Companies.
B. All Proceeds of the Insurance Claims.
-1-
Schedule 1 February 25, 1999
Schedule 3
APPLICABLE MARGINS, COMMITMENT FEE
-------------------------------------------------------------------------------------------------
REVOLVING LOANS:
Funded Debt/Adjusted
EBITDA Ratio Base Rate Margin LIBO Rate Margin Commitment Fee
+4.00 75.0 basis points 275.0 basis points 50.00 basis points
+3.75 but=4.00 50.0 basis points 250.0 basis points 37.50 basis points
+3.50 but=3.75 25.0 basis points 225.0 basis points 37.50 basis points
+3.00 but=3.50 00.0 basis points 200.0 basis points 31.25 basis points
=3.00 00.0 basis points 175.0 basis points 31.25 basis points
+ equals Greater than or equal to
= equals Less than
------------------------------------------------------------------------------------------------
TERM LOANS:
Base Rate Margin LIBO Rate Margin Commitment Fee
At All Times 75.0 basis points 275.0 basis points 100.00 basis points
-1-
Schedule 3 February 25, 1999
