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EXHIBIT 10.27
CREDIT AGREEMENT
between
TEPPCO CRUDE OIL, LLC,
as Borrower,
SUNTRUST BANK, ATLANTA,
as Administrative Agent,
SUNTRUST EQUITABLE SECURITIES CORPORATION,
as Sole Lead Arranger,
THE FIRST NATIONAL BANK OF CHICAGO,
as Syndication Agent,
FIRST UNION NATIONAL BANK,
as Documentation Agent,
and
CERTAIN LENDERS,
as Lenders
$30,000,000
MAY 17, 1999
[GRAPHIC OMITTED] [GRAPHIC OMITTED]
PREPARED BY XXXXXX AND XXXXX, L.L.P.
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TABLE OF CONTENTS
SECTION 1 DEFINITIONS AND TERMS...........................................................................1
1.1 Definitions.....................................................................................1
1.2 Time References................................................................................11
1.3 Other References...............................................................................11
1.4 Accounting Principles..........................................................................12
SECTION 2 COMMITMENT.....................................................................................12
2.1 Conditions.....................................................................................12
2.2 Borrowing Procedure............................................................................12
2.3 Effect of Requests.............................................................................13
2.4 Termination....................................................................................13
SECTION 3 PAYMENT TERMS..................................................................................13
3.1 Notes and Payments.............................................................................13
3.2 Interest and Principal Payments................................................................13
3.3 Interest Options...............................................................................14
3.4 Quotation of Rates.............................................................................14
3.5 Default Rate...................................................................................14
3.6 Interest Recapture.............................................................................14
3.7 Interest Calculations..........................................................................14
3.8 Maximum Rate...................................................................................14
3.9 Interest Periods...............................................................................15
3.10 Conversions....................................................................................15
3.11 Order of Application...........................................................................15
3.12 Sharing of Payments, Etc.......................................................................16
3.13 Offset.........................................................................................16
3.14 Booking Borrowings.............................................................................16
3.15 Basis Unavailable or Inadequate for LIBOR Rate.................................................16
3.16 Additional Costs...............................................................................17
3.17 Change in Legal Requirements...................................................................18
3.18 Funding Loss...................................................................................18
3.19 Foreign Lenders, Participants, and Assignees...................................................18
3.20 Discharge and Reinstatement....................................................................18
SECTION 4 FEES...........................................................................................19
4.1 Treatment of Fees..............................................................................19
4.2 Commitment Fee.................................................................................19
SECTION 5 CONDITIONS PRECEDENT...........................................................................19
SECTION 6 GUARANTIES.....................................................................................19
SECTION 7 REPRESENTATIONS AND WARRANTIES.................................................................19
7.1 Purpose........................................................................................20
7.2 Subsidiaries...................................................................................20
7.3 Existence, Authority, and Good Standing........................................................20
7.4 Authorization and Contravention................................................................20
7.5 Binding Effect.................................................................................20
7.6 Current Financials.............................................................................20
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7.7 Solvency.......................................................................................20
7.8 Litigation.....................................................................................20
7.9 Taxes..........................................................................................21
7.10 Environmental Matters..........................................................................21
7.11 Employee Plans.................................................................................21
7.12 Debt...........................................................................................21
7.13 Properties; Liens..............................................................................21
7.14 Government Regulations.........................................................................21
7.15 Transactions with Affiliates...................................................................22
7.16 Leases.........................................................................................22
7.17 Labor Matters..................................................................................22
7.18 Intellectual Property..........................................................................22
7.19 Y2K Issue......................................................................................22
7.20 Full Disclosure................................................................................22
SECTION 8 AFFIRMATIVE COVENANTS..........................................................................22
8.1 Certain Items Furnished........................................................................22
8.2 Use of Credit..................................................................................24
8.3 Books and Records..............................................................................24
8.4 Inspections....................................................................................24
8.5 Taxes..........................................................................................24
8.6 Payment of Obligation..........................................................................25
8.7 Expenses.......................................................................................25
8.8 Maintenance of Existence, Assets, and Business.................................................25
8.9 Insurance......................................................................................25
8.10 Environmental Matters..........................................................................25
8.11 INDEMNIFICATION................................................................................25
SECTION 9 NEGATIVE COVENANTS.............................................................................26
9.1 Debt...........................................................................................27
9.2 Prepayments....................................................................................27
9.3 Liens..........................................................................................27
9.4 Employee Plans.................................................................................28
9.5 Transactions with Affiliates...................................................................28
9.6 Compliance with Legal Requirements and Documents...............................................28
9.7 Investments....................................................................................29
9.8 Distributions..................................................................................29
9.9 Disposition of Assets..........................................................................29
9.10 Mergers, Consolidations, and Dissolutions......................................................29
9.11 Amendment of Constituent Documents.............................................................30
9.12 Assignment.....................................................................................30
9.13 Fiscal Year and Accounting Methods.............................................................30
9.14 New Businesses.................................................................................30
9.15 Government Regulations.........................................................................30
9.16 Strict Compliance..............................................................................30
SECTION 10 FINANCIAL COVENANTS............................................................................30
10.1 Minimum Net Worth..............................................................................30
10.2 Maximum Funded Debt to EBITDA..................................................................30
10.3 Fixed Charge Coverage Ratio....................................................................30
SECTION 11 EVENTS OF DEFAULT..............................................................................30
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11.1 Payment of Obligation..........................................................................30
11.2 Covenants......................................................................................31
11.3 Debtor Relief..................................................................................31
11.4 Judgments and Attachments......................................................................31
11.5 Government Action..............................................................................31
11.6 Misrepresentation..............................................................................31
11.7 Change of Control..............................................................................31
11.8 Other Debt.....................................................................................31
11.9 Validity and Enforceability....................................................................32
SECTION 12 RIGHTS AND REMEDIES............................................................................32
12.1 Remedies Upon Event of Default.................................................................32
12.2 Company Waivers................................................................................32
12.3 Not in Control.................................................................................33
12.4 Course of Dealing..............................................................................33
12.5 Cumulative Rights..............................................................................33
12.6 Application of Proceeds........................................................................33
12.7 Expenditures by Lenders........................................................................33
12.8 Limitation of Liability........................................................................33
SECTION 13 ADMINISTRATIVE AGENT AND LENDERS...............................................................34
13.1 Administrative Agent...........................................................................34
13.2 Expenses.......................................................................................35
13.3 Proportionate Absorption of Losses.............................................................35
13.4 Delegation of Duties; Reliance.................................................................35
13.5 Limitation of Administrative Agent's Liability.................................................36
13.6 Event of Default...............................................................................37
13.7 Limitation of Liability........................................................................37
13.8 Other Agents...................................................................................37
13.9 Relationship of Lenders........................................................................37
13.10 Benefits of Agreement..........................................................................37
SECTION 14 MISCELLANEOUS..................................................................................37
14.1 Nonbusiness Days...............................................................................37
14.2 Communications.................................................................................38
14.3 Form and Number................................................................................38
14.4 Exceptions.....................................................................................38
14.5 Survival.......................................................................................38
14.6 Governing Law..................................................................................38
14.7 Invalid Provisions.............................................................................38
14.8 Amendments, Supplements, Waivers, Consents, and Conflicts......................................38
14.9 Counterparts...................................................................................39
14.10 Parties........................................................................................39
14.11 Venue, Service of Process, and Jury Trial......................................................41
14.12 NON-RECOURSE TO TEXAS EASTERN..................................................................42
14.13 Confidentiality................................................................................42
14.14 Entirety.......................................................................................42
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SCHEDULES AND EXHIBITS
Schedule 2 - Lenders and Commitments
Schedule 5 - Closing Documents
Schedule 7.2 - Companies and Names
Schedule 7.8 - Litigation
Schedule 7.10 - Environmental Matters
Schedule 7.11 - Employee-Plan Matters
Schedule 7.12 - Existing Debt
Schedule 7.13 - Existing Liens
Schedule 7.15 - Affiliate Transactions
Exhibit A - Note
Exhibit B - Guaranty
Exhibit C-1 - Borrowing Request
Exhibit C-2 - Conversion Notice
Exhibit C-3 - Compliance Certificate (TCTM)
Exhibit C-4 - Compliance Certificate (other)
Exhibit D - Opinion of Counsel
Exhibit E - Assignment and Assumption Agreement
CREDIT AGREEMENT
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CREDIT AGREEMENT
THIS AGREEMENT is entered into as of May 17, 1999, between TEPPCO
CRUDE OIL, LLC, a Delaware limited liability company ("BORROWER"), Lenders
(defined below), SUNTRUST BANK, ATLANTA, as Administrative Agent for Lenders,
THE FIRST NATIONAL BANK OF CHICAGO, as Syndication Agent for Lenders, and FIRST
UNION NATIONAL BANK, as Documentation Agent for Lenders.
Borrower has requested that Lenders from time to time extend revolving
credit loans to Borrower not to exceed a total outstanding principal amount of
$30,000,000 (as that amount may be reduced or cancelled pursuant to this
agreement) to be used by Borrower as provided in SECTION 7.1. Lenders are
willing to extend the requested loans on the terms and conditions of this
agreement.
ACCORDINGLY, for adequate and sufficient consideration, Borrower,
Lenders, and Administrative Agent agree as follows:
SECTION 1 DEFINITIONS AND TERMS.
1.1 DEFINITIONS. As used in the Credit Documents:
"ADMINISTRATIVE AGENT" means, at any time, SunTrust Bank, Atlanta (or
its successor appointed under SECTION 13), acting as administrative agent for
Lenders under the Credit Documents.
"AFFILIATE" of a Person means any other individual or entity who
directly or indirectly controls, is controlled by, or is under common control
with that Person. For purposes of this definition (a) "control," "controlled
by," and "under common control with" mean possession, directly or indirectly,
of power to direct or cause the direction of management or policies (whether
through ownership of voting securities or other interests, by contract, or
otherwise), and (b) Texas Eastern, TEPPCO Partners, and all of the Subsidiaries
of TEPPCO Partners are Affiliates with each other.
"APPLICABLE MARGIN" means, for any day, the margin of interest over
the Base Rate, or the LIBOR Rate, as the case may be, that is applicable when
the Base Rate or LIBOR Rate, as applicable, is determined under this agreement.
(a) The Applicable Margin is subject to adjustment (upwards
or downwards, as appropriate) based on the ratio of the Companies'
Funded Debt to EBITDA as stated in the table below.
(b) For purposes of the definitions of "Applicable Margin"
and "Applicable Percentage," EBITDA and Funded Debt are calculated for
the Companies' most recently completed fiscal quarter.
(c) The Applicable Margin and Applicable Percentage in effect
at any time (whether in the middle of an Interest Period or otherwise)
are based upon the ratio of the Companies' Funded Debt to EBITDA as
determined from the Current Financials and related Compliance
Certificate then
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most recently received by Administrative Agent, effective as of the
date received by Administrative Agent.
(d) If Borrower fails to timely furnish to Administrative
Agent any Financials and related Compliance Certificate as required by
this agreement, then the maximum Applicable Margin and Applicable
Percentage apply from the date those Financials and related Compliance
Certificate are required to be delivered and remain in effect until
Borrower furnishes them to Administrative Agent.
APPLICABLE APPLICABLE
MARGIN FOR MARGIN FOR
RATIO OF FUNDED DEBT TO EBITDA BASE-RATE LIBOR-RATE
BORROWINGS BORROWINGS
================================== ========== ==========
Greater than 1.00 to 1.00 0.500% 1.500%
---------------------------------- ------ -----
Less than or equal to 1.00 to 1.00 0.250% 1.250%
================================== ====== =====
"APPLICABLE PERCENTAGE" means, for any day, a commitment-fee
percentage applicable under SECTION 4.2, subject to adjustment (upwards or
downwards, as appropriate), based on the ratio of the Companies' Funded Debt to
EBITDA, as follows:
RATIO OF FUNDED DEBT TO APPLICABLE
EBITDA PERCENTAGE
================================== ===========
Greater than 1.00 to 1.00 0.375%
---------------------------------- -----
Less than or equal to 1.00 to 1.00 0.250%
================================== ======
The Applicable Percentage is calculated and determined as further provided in
the definition of the term "Applicable Margin."
"ASSIGNEE" is defined in SECTION 14.10(d).
"ASSIGNMENT" is defined in SECTION 14.10(d).
"BASE RATE" means, for any day, the greater of either (a) the annual
interest rate most recently announced by Administrative Agent as its prime
lending rate (which may not necessarily represent the lowest or best rate
actually charged to any customer, as Administrative Agent may make commercial
loans or other loans at interest rates higher or lower than that prime lending
rate) in effect at its principal office in Atlanta, Georgia, which rate may
automatically increase or decrease without notice to Borrower or any other
Person, or (b) the sum of the Fed-Funds Rate plus 0.5%.
"BASE-RATE BORROWING" means a Borrowing bearing interest at the sum of
the Base Rate plus the Applicable Margin.
"BORROWER" is defined in the preamble to this agreement.
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"BORROWING" means any amount disbursed under the Credit Documents by
one or more Lenders to or on behalf of Borrower under the Credit Documents,
either as an original disbursement of funds, a renewal, extension, or
continuation of an amount outstanding.
"BORROWING DATE" is defined in SECTION 2.2(a).
"BORROWING REQUEST" means a request, subject to SECTION 2.2(a),
substantially in the form of EXHIBIT C-1.
"BUSINESS DAY" means (a) for purposes of any LIBOR-Rate Borrowing, a
day when commercial banks are open for international business in London,
England, and (b) for all other purposes, any day other than Saturday, Sunday,
and any other day that commercial banks are authorized by Legal Requirement to
be closed in Georgia or New York.
"CAPITAL LEASE" means any capital lease or sublease that is required
by GAAP to be capitalized on a balance sheet.
"CERCLA" means the Comprehensive Environmental Response, Compensation
and Liability Act of 1980, 42 U.S.C. ss.ss.9601 et seq.
"CLOSING DATE" means the date agreed to by Borrower and Administrative
Agent for disbursement of the initial Borrowing under this agreement, which
must be a Business Day occurring no later than June 1, 1999, but not before all
of the conditions precedent in this agreement for that disbursement have been
satisfied.
"COMMITMENT" means, at any time and for any Lender, the amount stated
beside that Lender's name on the most-recently amended SCHEDULE 2.
"COMMITMENT PERCENTAGE" means, for any Lender and at any time, the
proportion (stated as a percentage) that its Commitment bears to the total
Commitments of all Lenders.
"COMPANIES" means, at any time, TCTM and each of its Subsidiaries.
"COMPLIANCE CERTIFICATE" means a certificate substantially in the form
of EXHIBIT C-3 and signed by a Responsible Officer on behalf of TCTM or the
form of EXHIBIT C-4 signed by a Responsible Officer on behalf of TEPPCO
Partners or Borrower, as the case may be.
"CONSTITUENT DOCUMENTS" means, for any Person, the documents for its
formation and organization, which, for example, for a (a) corporation are its
corporate charter and bylaws, (b) for a partnership is its partnership
agreement, (c) for a limited-liability company are its certificate of
organization and regulations, and (d) for a trust is the trust agreement or
indenture under which it is created.
"CONVERSION NOTICE" means a request, subject to SECTION 3.10,
substantially in the form of EXHIBIT C-2.
"CREDIT DOCUMENTS" means (a) this agreement, certificates, and reports
delivered by or on behalf of any Company, TEPPCO Partners, or Texas Eastern
under this agreement, and exhibits and schedules to
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this agreement, (b) all agreements, documents, and instruments in favor of
Administrative Agent or Lenders (or Administrative Agent on behalf of Lenders)
ever delivered by or on behalf of any Company, TEPPCO Partners, or Texas
Eastern in connection with or under this agreement or otherwise delivered by or
on behalf of any Company, TEPPCO Partners, or Texas Eastern in connection with
all or any part of the Obligation, and (c) all renewals, extensions, and
restatements of, and amendments and supplements to, any of the foregoing.
"CURRENT FINANCIALS" means, unless otherwise specified, either (a)
TEPPCO Partners's consolidated Financials for the year ended December 31, 1998,
or (b) at any time after annual Financials are first delivered under SECTION
8.1, TEPPCO Partners's annual Financials then most recently delivered to
Lenders under SECTION 8.1(a), together with TEPPCO Partners's quarterly
Financials then most recently delivered to Lenders under SECTION 8.1(b).
"DEBT" means -- for any Person, at any time, and without duplication
-- the sum of (a) all Funded Debt of that Person, plus (b) all obligations
arising under acceptance facilities or facilities for the discount or sale of
accounts receivable, plus (c) all direct or contingent obligations in respect
of letters of credit, plus (d) each obligation for Hedging Exposure of
$10,000,000 or more, plus (e) all guaranties, endorsements, and other
contingent obligations for the obligations in respect of obligations of other
persons or entities of the nature described in CLAUSES (a) through (d) above.
"DEBTOR LAWS" means the Bankruptcy Code of the United States of
America and all other applicable liquidation, conservatorship, bankruptcy,
moratorium, rearrangement, receivership, insolvency, reorganization, suspension
of payments, or similar Legal Requirements affecting creditors' Rights.
"DEFAULT PERCENTAGE" means, for any Lender and at any time, the
proportion (stated as a percentage) that the Principal Debt owed to it bears to
the Principal Debt owed all Lenders.
"DEFAULT RATE" means, for any day, an annual interest rate equal from
day to day to the lesser of either (a) the sum of the Base Rate plus 2% or (b)
the Maximum Rate.
"DISTRIBUTION" means, with respect to any shares of any capital stock,
other equity securities, or ownership interests issued by a Person (a) the
retirement, redemption, purchase, or other acquisition for value of those
securities or interests, (b) the declaration or payment of any dividend on or
with respect to those securities or interests, (c) any Investment by that
Person in the holder of any of those securities or interests, and (d) any other
payment by that Person with respect to those securities or interests.
"EBITDA" means:
(a) For any period consisting of four consecutive fiscal
quarters taken as a single accounting period, for any Person, and
without duplication -- the sum of (i) Net Income plus (ii) to the
extent actually deducted in determining Net Income, Interest Expense,
Tax Expense, depreciation, and amortization;
(b) For purposes of calculating EBITDA in respect of any
entity that became a Subsidiary of that Person or was merged with or
consolidated into that Person during that period, EBITDA of that
Person shall include the EBITDA of that entity during that period and
before the
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date of that acquisition, merger, or consolidation for a total period
of four consecutive fiscal quarters; and
(c) For purposes of calculating EBITDA in respect of Borrower
(i) Borrower's EBITDA for the two fiscal quarters ending June 30,
1999, shall be multiplied by two, and (ii) Borrower's EBITDA for the
three consecutive fiscal quarters ending September 30, 1999, shall be
multiplied by four-thirds.
"EMPLOYEE PLAN" means any employee-pension-benefit plan covered by
Title IV of ERISA and established or maintained by Guarantor or any ERISA
Affiliate (other than a Multiemployer Plan).
"ENVIRONMENTAL LAW" means any applicable Legal Requirement that
relates to protection of the environment or to the regulation of any Hazardous
Substances, including CERCLA, the Hazardous Materials Transportation Act (49
U.S.C. Section 1801 et seq.), the Resource Conservation and Recovery Act (42
U.S.C. Section 6901 et seq.), the Clean Water Act (33 U.S.C. Section 1251 et
seq.), the Clean Air Act (42 U.S.C. Section 7401 et seq.), the Toxic Substances
Control Act (15 U.S.C. Section 2601 et seq.), the Federal Insecticide,
Fungicide, and Rodenticide Act (7 U.S.C. Section 136 et seq.), the Emergency
Planning and Community Right-to-Know Act (42 U.S.C. Section 11001 et seq.), the
Safe Drinking Water Act (42 U.S.C. Section 201 and Section 300f et seq.), the
Rivers and Harbors Act (33 U.S.C. Section 401 et seq.), the Oil Pollution Act
(33 U.S.C. Section 2701 et seq.), analogous state and local Legal Requirements,
and any analogous future enacted or adopted Legal Requirement.
"ENVIRONMENTAL LIABILITY" means any liability, loss, fine, penalty,
charge, lien, damage, cost, or expense of any kind to the extent that it
results (a) from the violation of any Environmental Law, (b) from the Release
or threatened Release of any Hazardous Substance, or (c) from actual or
threatened damages to natural resources.
"ENVIRONMENTAL PERMIT" means any permit, or license, from any Person
defined in CLAUSE (a) of the definition of Governmental Authority that is
required under any Environmental Law for the lawful conduct of any business,
process, or other activity.
"ERISA" means the Employee Retirement Income Security Act of 1974.
"ERISA AFFILIATE" means any Person that, for purposes of Title IV of
ERISA, is a member of any Company's controlled group or is under common control
with any Company within the meaning of Section 414 of the IRC.
"EVENT OF DEFAULT" is defined in SECTION 11.
"FED-FUNDS RATE" means, for any day, the annual rate (rounded upwards,
if necessary, to the nearest 0.01%) determined (which determination is
conclusive and binding, absent manifest error) by Administrative Agent to be
equal to (a) the weighted average of the rates on overnight federal-funds
transactions with member banks of the Federal Reserve System arranged by
federal-funds brokers on that day, as published by the Federal Reserve Bank of
New York on the next Business Day, or (b) if those rates are not published for
any day, the average of the quotations at approximately 10:00 a.m. received by
Administrative Agent from three federal-funds brokers of recognized standing
selected by Administrative Agent in its sole discretion.
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"FINANCIALS" of a Person means balance sheets, profit and loss
statements, reconciliations of capital and surplus, and statements of cash flow
prepared (a) according to GAAP (subject to year end audit adjustments with
respect to interim Financials) and (b) except as stated in SECTION 1.4, in
comparative form to prior year-end figures or corresponding periods of the
preceding fiscal year or other relevant period, as applicable.
"FUNDED DEBT" means -- for any Person, at any time, and without
duplication -- the sum of (a) the unpaid principal amount or component of all
obligations for borrowed money, plus (b) the unpaid principal amount or
component of all obligations evidenced by bonds, debentures, notes or similar
instruments, plus (c) the unpaid principal amount or component of all
obligations to pay the deferred purchase price of property or service except
trade accounts payable arising in the ordinary course of business, plus (d) in
respect of all obligations that are secured (or for which the holder of any
such obligation has an existing Right, contingent or otherwise, to be so
secured) by any Lien on property owned or acquired by that Person, the lesser
of either the unpaid amount of all of those obligations from time to time
outstanding or the fair- market value of the property securing all of those
obligations, liabilities secured (or for which the holder of such obligations
has an existing Right, contingent or otherwise, to be so secured) by any Lien
existing on property owned or acquired by that Person, plus (e) all Capital
Lease obligations, plus (f) the unpaid principal amount or component of all
obligations under synthetic leases, plus (g) the unpaid principal amount or
component of all guaranties, endorsements, and other contingent obligations in
respect of obligations of other persons or entities of the nature described in
CLAUSES (A) through (F) above.
"FUNDING LOSS" means any loss, expense, or reduction in yield (but not
any Applicable Margin) that (a) any Lender reasonably incurs because (i)
Borrower fails or refuses (for any reason whatsoever other than a default by
Administrative Agent or the Lender claiming that loss, expense, or reduction in
yield) to take any Borrowing that it has requested under this agreement, or
(ii) Borrower voluntarily or involuntarily prepays or pays any LIBOR-Rate
Borrowing or converts any LIBOR-Rate Borrowing to a Borrowing of another Type,
in each case, other than on the last day of the applicable Interest Period, and
(b) shall be determined by the relevant Lender to be the excess, if any, of (i)
the amount of interest which would have accrued on the principal amount of such
Borrowing had such event not occurred, at the LIBOR Rate, for the period from
the date of the event to the last day of the then current Interest Period (or,
in the case of a failure to borrow, convert, or continue, for the period that
would have been the Interest Period for that Borrowing), over (ii) the amount
of interest which would accrue on that principal amount for that period at the
interest rate which that Lender would bid were it to bid, at the commencement
of that period, for dollar deposits of a comparable amount and period from
other banks in the London interbank market.
"GAAP" means generally accepted accounting principles of the
Accounting Principles Board of the American Institute of Certified Public
Accountants and the Financial Accounting Standards Board that are applicable
from time to time.
"GOVERNMENT SECURITIES" means (to the extent they mature within one
year from the date in question) readily marketable (a) direct full faith and
credit obligations of the United States of America or obligations guaranteed by
the full faith and credit of the United States of America, and (b) obligations
of an agency or instrumentality of, or corporation owned, controlled, or
sponsored by, the United States of America that are generally considered in the
securities industry to be implicit obligations of the United States of America.
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"GOVERNMENTAL AUTHORITY" means any (a) local, state, territorial,
federal, or foreign judicial, executive, regulatory, administrative,
legislative, or governmental agency, board, bureau, commission, department, or
other instrumentality, (b) private arbitration board or panel, or (c) central
bank.
"GUARANTORS" means TEPPCO Partners, TCTM, and each other TCTM
Subsidiary delivering a Guaranty as required by SECTION 6.
"GUARANTY" means a guaranty substantially in the form of EXHIBIT B.
"HAZARDOUS SUBSTANCE" means any substance that is designated, defined,
classified, or regulated as a hazardous waste, hazardous material, pollutant,
contaminant, explosive, corrosive, flammable, infectious, carcinogenic,
mutagenic, radioactive, or toxic or hazardous substance under any Environmental
Law, including, without limitation, any hazardous substance within the meaning
of Section 101(14) of CERCLA.
"HEDGING AGREEMENT" means, for any Person, any present or future,
whether master or single, agreement, document or instrument providing for, or
constituting an agreement to enter into (a) commodity xxxxxx in the normal
course of business in accordance with practices of that Person for hedging
material purchases, (b) arrangement for foreign-currency-exchange protection,
(c) Rate-Protection Arrangement, and (d) interest-rate-hedging products
involving payment premium for which that Person has no future liability.
"HEDGING EXPOSURE" means at any time (a) for a Rate-Protection
Arrangement, the related Rate- Protection Exposure, and (b) for any other
Hedging Agreement, the amount, if any, that would be payable to the counter
party to that Hedging Agreement if it were terminated at that time.
"INTEREST EXPENSE" means, for any Person and any period, all interest
expense (including all amortization of debt discount and expenses and reported
interest) on all Funded Debt of that Person.
"INTEREST PERIOD" is defined in SECTION 3.9.
"INVESTMENT" means, in respect of any Person, any loan, advance,
extension of credit, or capital contribution to that Person, any other
investment in that Person, or any purchase or commitment to purchase any equity
securities or Debt issued by that Person or substantially all of the assets or
a division or other business unit of that Person. However, the term investment
does not include any extension of trade debt in the ordinary course of business
or, as a result of collection efforts, the receipt of any equity in or property
of a Person.
"IRC" means the Internal Revenue Code of 1986.
"LEGAL REQUIREMENTS" means all applicable statutes, laws, treaties,
ordinances, rules, regulations, orders, writs, injunctions, decrees, judgments,
opinions, and interpretations of any Governmental Authority.
"LENDERS" means the financial institutions (including, without
limitation, Administrative Agent, in its capacity as a Lender, in respect of
its Commitment) initially named on SCHEDULE 2 or, to the extent they constitute
permitted assignees pursuant to the terms of this agreement, on the
most-recently-amended SCHEDULE 2, if any, delivered by Administrative Agent
under this agreement, and, subject to this agreement, their respective
successors and permitted assigns (but not any Participant who is not otherwise
a party to this agreement in the capacity as Lenders).
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"LIBOR RATE" means, for a LIBOR-Rate Borrowing and its Interest
Period, the quotient of (a) the annual interest rate for deposits in United
States dollars of amounts equal or comparable to the principal amount of that
LIBOR-Rate Borrowing offered for a term comparable to that Interest Rate, which
rate appears on the Telerate Page 3750 as of 11:00 a.m. (London, England time)
two Business Days before the beginning of that Interest Period or, if no such
offered rates appear on such page, then the rate used for that Interest Period
shall be the arithmetic average (rounded upwards, if necessary, to the next
higher 0.001%) of rate offered by Lender to not less than two major banks in
New York, New York at approximately 10:00 a.m. (Atlanta, Georgia time) two
Business Days before the beginning of that Interest Period for deposits in
United States dollars in the London interbank market of the principal amount of
that LIBOR Borrowing offered for a term comparable to that Interest Period,
divided by (b) a number equal to 1.00 minus the LIBOR Reserve Percentage. The
rate so determined in accordance herewith shall be rounded upwards to the
nearest multiple of 0.001%, and the term "TELERATE PAGE 3750" means the display
designated as "Page 3750" on the Dow Xxxxx Markets Service, Inc. (or such other
page as may replace Page 3750 on that service or another service as may be
nominated by the British Bankers' Association as the information vendor for the
purpose of displaying British Bankers' Association Interest Settlement Rates
for United States dollars).
"LIBOR-RATE BORROWING" means a Borrowing bearing interest at the sum
of the LIBOR Rate plus the Applicable Margin.
"LIBOR RESERVE PERCENTAGE" means, for any Interest Period with respect
to a LIBOR-Rate Borrowing, the reserve percentage applicable to that Interest
Period (or, if more than one such percentage shall be so applicable, then the
daily average of such percentages for those days in that Interest Period during
which any such percentage shall be applicable) under regulations issued from
time to time by the Board of Governors of the Federal Reserve System (or any
successor) for determining the maximum reserve requirement (including any
emergency, supplemental, or other marginal reserve requirement) for Lenders
with respect to liabilities or assets consisting of or including "eurocurrency
liabilities" (as defined in Regulation D of the Board of Governors of the
Federal Reserve System, as in effect from time to time) having a term equal to
that Interest Period.
"LIEN" means any lien, mortgage, security interest, pledge,
assignment, charge, title retention agreement, or encumbrance of any kind and
any other arrangement for a creditor's claim to be satisfied from assets or
proceeds prior to the claims of other creditors or the owners (other than title
of the lessor under an operating lease).
"LITIGATION" means any action by or before any Governmental Authority.
"LSI" means Lubrication Services, LLC, a Delaware limited liability
company and wholly owned Subsidiary of Borrower.
"MATERIAL-ADVERSE EVENT" means any circumstance or event that,
individually or collectively, is, or is reasonably expected to result in, any
(a) material impairment of (i) the ability of Borrower or any Guarantor to
perform any of their respective payment or other material obligations under any
Credit Document, or (ii) the ability of Administrative Agent or any Lender to
enforce any of those obligations or any of their respective Rights under the
Credit Documents (other than as a result of its own act or omission), (b)
material and adverse effect on the financial condition of Borrower or TCTM,
individually, or TEPPCO Partners and its Subsidiaries, as a whole, as
represented to Lenders in the Current Financials most recently delivered before
the date of this agreement, or (c) Event of Default or Potential Default.
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"MAXIMUM AMOUNT" and "MAXIMUM RATE" respectively mean, for a Lender,
the maximum non- usurious amount and the maximum non-usurious rate of interest
that, under applicable Legal Requirement, that Lender is permitted to contract
for, charge, take, reserve, or receive on the Obligation.
"MULTIEMPLOYER PLAN" means a multiemployer plan as defined in Sections
3(37) or 4001(a)(3) of ERISA or Section 414(f) of the IRC to which any Company
or any ERISA Affiliate is making, or has made, or is accruing, or has accrued,
an obligation to make contributions.
"NET INCOME" means, for any Person and any period, that Person's
profit or loss (a) after deducting all of its operating expenses, provision for
Taxes, and reserves (including reserves for deferred income Taxes), and all
other deductions in accordance with GAAP, but (b) excluding (i) extraordinary
items, and (ii) the profit or loss of any entity accrued before the date that
(A) it becomes a Subsidiary of such Person, (B) it is merged with such Person
or any of its Subsidiaries, or (C) its assets are acquired by such Person of
any of its Subsidiaries.
"NOTE" means a Note substantially in the form of EXHIBIT A.
"OBLIGATION" means all present and future (a) Debts, liabilities, and
obligations of Borrower to Administrative Agent or any Lender that arises under
any Credit Document, whether principal, interest, fees, costs, attorneys' fees,
or otherwise, (b) Rate-Protection Exposure of any Rate-Protection Party that is
a Lender or an Affiliate (with whom Borrower has contractually entered into
that Hedging Agreement in connection with this agreement) of a Lender, and (c)
renewals, extensions, and modifications of any of the foregoing.
"OSHA" means the Occupational Safety and Health Act of 1970, 29 U.S.C.
Section 651 et seq.
"PARTICIPANT" is defined in SECTION 14.10(c).
"PBGC" means the Pension Benefit Guaranty Corporation.
"PERMITTED DEBT" is defined in SECTION 9.1.
"PERMITTED LIENS" is defined in SECTION 9.3.
"PERMITTED INVESTMENT" is defined in SECTION 9.7.
"PERSON" means any individual, entity, or Governmental Authority.
"POTENTIAL DEFAULT" means any event, occurrence, or circumstance, the
existence of which upon any required notice, time lapse, or both, would become
an Event of Default.
"PREDECESSOR" means any Person for whose obligations and liabilities
any Company is reasonably expected to be liable as the result of any merger, de
facto merger, stock purchase, asset purchase or divestiture, combination, joint
venture, investment, reclassification, or other similar business transaction.
"PRINCIPAL DEBT" means, at any time, the unpaid principal balance of
all Borrowings.
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"RATE-PROTECTION ARRANGEMENT" means any interest-rate swap, cap,
collar, or similar arrangement.
"RATE-PROTECTION EXPOSURE" means, for any Rate-Protection Arrangement
and at any time, the amount, if any, that would be payable to the
Rate-Protection Party in that Rate-Protection Arrangement for any "agreement
value" as though that Rate-Protection Arrangement were terminated at that time,
in each case (a) calculated as provided in the International Swap Dealers
Association Inc. Code of Standard Wording, Assumptions, and Provisions for
SWAPS in effect on the date such arrangement is entered into, and (b)
determined by Administrative Agent in good faith in reliance upon any
information (including any information provided by the Rate-Protection Party)
that Administrative Agent believes (with no obligation to verify accuracy) to
be accurate.
"RATE-PROTECTION PARTY" means, at any time, any party that has entered
into a Rate-Protection Arrangement with Borrower.
"REAL PROPERTY" means any land, buildings, fixtures, and other
improvements to land now or in the future directly or indirectly owned by any
Company, leased to or otherwise operated by any Company, or subleased by any
Company to any other Person.
"RELEASE" means any "release" as defined under any Environmental Law.
"REPRESENTATIVES" means officers, directors, employees, accountants,
attorneys, and agents.
"REQUIRED LENDERS" means, at any time, any combination of Lenders
holding (directly or indirectly) at least 66 2/3% of either (a) the total
Commitments while there is no Principal Debt or (b) the Principal Debt while
there is any Principal Debt.
"RESPONSIBLE OFFICER" means the chairman, president, vice president,
chief executive officer, chief financial officer, treasurer, or corporate
secretary of Texas Eastern.
"RIGHTS" means rights, remedies, powers, privileges, and benefits.
"SOLVENT" means, as to any Person, that (a) the aggregate fair market
value of its assets exceeds its liabilities, (b) it has sufficient cash flow to
enable it to pay its Debts as they mature, and (c) it does not have
unreasonably small capital to conduct its businesses.
"STATED-TERMINATION DATE" means May 17, 2002.
"SUBSIDIARY" of any Person means any corporation, limited liability
company, general or limited partnership, or other entity of which more than 50%
(in number of votes) of the stock (or equivalent interests) is owned of record
or beneficially, directly or indirectly, by that Person.
"TAXES" means, for any Person, taxes, assessments, or other
governmental charges or levies imposed upon it, its income, or any of its
properties, franchises, or assets.
"TAX EXPENSE" means -- for any Person, for any period, and without
duplication -- the Taxes on income accrued during that period.
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"TCTM" means TCTM, L.P., a Delaware limited partnership.
"TE PRODUCTS" means TE Products Pipeline Company, Limited Partnership,
a Delaware limited partnership.
"TE PRODUCTS CREDIT AGREEMENT" means the Credit Agreement dated as of
the date of this agreement, between TE Products, certain lenders, and SunTrust
Bank, Atlanta, as agent for those lenders, and certain other agents for those
lenders.
"TEPPCO PIPELINE" means TEPPCO Crude Pipeline, LLC, a Delaware limited
liability company and wholly owned Subsidiary of Borrower.
"TEPPCO PARTNERS" means TEPPCO Partners, L.P., a Delaware limited
partnership.
"TERMINATION DATE" means the earlier of either (a) the
Stated-Termination Date or (b) the effective date that Lenders' commitments to
lend under this agreement are fully canceled or terminated.
"TEXAS EASTERN" means Texas Eastern Products Pipeline Company, a
Delaware corporation.
"TYPE" means any type of Borrowing determined with respect to the
applicable interest option.
"Y2K ISSUE" means the risk that computer applications used by the
Companies or by any of their respective suppliers or vendors may be unable
properly to recognize and perform date-sensitive functions.
1.2 TIME REFERENCES. Unless otherwise specified, in the Credit
Documents (a) time references (e.g., 10:00 a.m.) are to time in Atlanta,
Georgia, on the applicable date, and (b) in calculating a period from one date
to another, the word "from" means "from and including" and the word "to" or
"until" means "to but excluding."
1.3 OTHER REFERENCES. Unless otherwise specified, in the Credit
Documents (a) where appropriate, the singular includes the plural and vice
versa, and words of any gender include each other gender, (b) where
appropriate, words include their respective cognate expressions, (c) heading
and caption references may not be construed in interpreting provisions, (d)
monetary references are to currency of the United States of America, (e)
section, paragraph, annex, schedule, exhibit, and similar references are to the
particular Credit Document in which they are used, (f) references to
"telecopy," "facsimile," "fax," or similar terms are to facsimile or telecopy
transmissions, (g) references to "including" mean including without limiting
the generality of any description preceding that word, (h) the rule of
construction that references to general items that follow references to
specific items are limited to the same type or character of those specific
items is not applicable in the Credit Documents, (i) references to "writing"
include printing, typing, lithography, and other means of reproducing words in
a tangible, visible form, (j) references to any Person include that Person's
heirs, personal representatives, successors, trustees, receivers, and permitted
assigns, (k) references to any Legal Requirement include every amendment or
supplement to it, rule and regulation adopted under it, and successor or
replacement for it, (l) references to any Governmental Authority include any
Person succeeding to its relevant function, and (m) references to any Credit
Document or other document include (to the extent not prohibited by the terms
of the Credit Documents) every renewal and extension of it, amendment and
supplement to it, and replacement or substitution for it.
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1.4 ACCOUNTING PRINCIPLES. Unless otherwise specified, in the Credit
Documents (a) GAAP determines all accounting and financial terms and compliance
with financial covenants, (b) GAAP in effect on the date of this agreement
determines compliance with financial covenants, (c) otherwise, all accounting
principles applied in a current period must be comparable in all material
respects to those applied during the preceding comparable period, and (d) all
financial terms and compliance with reporting and financial covenants must be
on a consolidated basis, as applicable.
SECTION 2 COMMITMENT. Subject to the provisions in the Credit Documents, each
Lender severally but not jointly agrees to lend to Borrower that Lender's
Commitment Percentage of requested Borrowings, which Borrower may borrow,
repay, and reborrow under this agreement subject to the provisions in the
Credit Documents.
2.1 CONDITIONS. Each Borrowing is subject to all of the provisions in
the Credit Documents, including the following: (a) each Borrowing may only
occur on a Business Day on or after the Closing Date and before the Termination
Date; (b) each Borrowing may only be $500,000 or a greater integral multiple of
$100,000; and (c) the Principal Debt may never exceed the total Commitments.
2.2 BORROWING PROCEDURE. The following procedures apply to Borrowings:
(a) BORROWING REQUEST. Borrower may request a Borrowing by
making or delivering a Borrowing Request to Administrative Agent,
which is irrevocable and binding on Borrower, stating the Type,
amount, and Interest Period for each Borrowing and which must be
received by Administrative Agent no later than (i) 10:00 a.m. on the
second Business Day before the date on which funds are requested (the
"BORROWING DATE") for any LIBOR-Rate Borrowing, or (ii) 11:00 a.m. on
the Borrowing Date for any Base-Rate Borrowing. Administrative Agent
shall promptly on the day received notify each Lender of any Borrowing
Request.
(b) FUNDING. Each Lender shall remit its Commitment
Percentage of each requested Borrowing to Administrative Agent's
principal office in Atlanta, Georgia, in funds that are available for
immediate use by Administrative Agent by 2:00 p.m. on the applicable
Borrowing Date. Subject to receipt of those funds, Administrative
Agent shall (unless to its actual knowledge any of the applicable
conditions precedent have not been satisfied by Borrower or waived by
the requisite Lenders) make those funds available to Borrower by
wiring the funds to or for the account of Borrower.
(c) FUNDING ASSUMED. Absent contrary written notice from a
Lender, Administrative Agent may assume that each Lender has made its
Commitment Percentage of the requested Borrowing available to
Administrative Agent on the applicable Borrowing Date, and
Administrative Agent may, in reliance upon such assumption (but shall
not be required to), make available to Borrower a corresponding
amount. If a Lender fails to make its Commitment Percentage of any
requested Borrowing available to Administrative Agent on the
applicable Borrowing Date, Administrative Agent may recover the
applicable amount on demand (i) from that Lender together with
interest, commencing on the Borrowing Date and ending on (but
excluding) the date Administrative Agent recovers the amount from that
Lender, at an annual interest rate equal to the Fed-Funds Rate, or
(ii) if that Lender fails to pay its amount upon demand, then from
Borrower, together with interest at the rate applicable to that
Borrowing. No Lender is responsible for the failure of any other
Lender to make its Commitment Percentage of any Borrowing available as
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required by SECTION 2.2 (b); however, failure of any Lender to make
its Commitment Percentage of any Borrowing so available does not
excuse any other Lender from making its Commitment Percentage of any
Borrowing so available.
2.3 EFFECT OF REQUESTS. Each Borrowing Request constitutes a
representation and warranty by Borrower that as of the Borrowing Date all of
the applicable conditions precedent in SECTION 5 have been satisfied.
2.4 TERMINATION. Borrower may, upon giving at least five Business Days
prior written and irrevocable notice to Administrative Agent, terminate all or
part of the Commitment. Each partial termination must be in an amount of not
less than $5,000,000 or a greater integral multiple of $1,000,000 and must be
ratable in accordance with each Lender's Commitment Percentage. At the time of
any termination, Borrower shall pay to Administrative Agent, for the account of
each Lender, as applicable, all accrued and unpaid fees under this agreement,
the interest attributable to the amount of that reduction, and any related
Funding Loss. Any part of the Commitment that is terminated may not be
reinstated.
SECTION 3 PAYMENT TERMS.
3.1 NOTES AND PAYMENTS. The Principal Debt is evidenced by the Notes,
one payable to each Lender in the stated amount of its Commitment. Borrower
must make each payment and prepayment on the Obligation to Administrative
Agent's principal office in Atlanta, Georgia, in immediately available funds by
1:00 p.m. on the day due; otherwise, but subject to SECTION 3.6, those funds
continue to accrue interest as if they were received on the next Business Day.
Administrative Agent shall promptly pay to each Lender the part of any payment
or prepayment to which that Lender is entitled under this agreement on the same
day Administrative Agent receives the funds from Borrower. Unless
Administrative Agent has received notice from Borrower before the date on which
any payment is due under this agreement that Borrower will not make that
payment in full, then on the date that payment is due Administrative Agent may
assume that Borrower has made the full payment due and Administrative Agent
may, in reliance upon that assumption, cause to be distributed to each Lender
on that date the amount then due to each Lender. If and to the extent Borrower
does not make the full payment due to Administrative Agent, each Lender shall
repay to Administrative Agent on demand the amount distributed to that Lender
by Administrative Agent together with interest for each day from the date that
Lender received payment from Administrative Agent until the date that Lender
repays Administrative Agent (unless such repayment is made on the same day as
such distribution), at an interest rate equal to the Fed-Funds Rate.
3.2 INTEREST AND PRINCIPAL PAYMENTS.
(a) INTEREST. Accrued interest on each LIBOR-Rate Borrowing
is due and payable on the last day of its respective Interest Period.
If any Interest Period for a LIBOR-Rate Borrowing is greater than
three months, then accrued interest is also due and payable on the
date three months after the commencement of the Interest Period.
Accrued interest on each Base-Rate Borrowing is due and payable in
arrears on (i) the last day of each calendar month, commencing on the
first of those dates that follows the Closing Date, and (ii) the
Termination Date.
(b) PRINCIPAL DEBT. The Principal Debt is due and payable on
the Termination Date. Before that date, Borrower may at any time
prepay, without penalty and in whole or in part, the Principal Debt so
long as (i) each voluntary partial prepayment must be in a principal
amount not
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less than $500,000 or a greater integral multiple of $100,000 and (ii)
Borrower shall pay the related Funding Loss, if any, upon demand.
Conversions under SECTION 3.10 are not prepayments.
3.3 INTEREST OPTIONS. Except that the LIBOR-Rate may not be selected
when an Event of Default or Potential Default exists and except as otherwise
provided in this agreement Borrowings bear interest at an annual rate equal to
the lesser of either (a) the Base Rate or the LIBOR Rate plus the Applicable
Margin, in each case as designated or deemed designated by Borrower or (b) the
Maximum Rate.
3.4 QUOTATION OF RATES. Borrower may contact Administrative Agent
prior to delivering a Borrowing Request to receive an indication of the
interest rates then in effect, but the indicated rates do not bind
Administrative Agent or Lenders or affect the interest rate that is actually in
effect when Borrower makes a Borrowing Request or on the Borrowing Date.
3.5 DEFAULT RATE. To the extent lawful, all past-due Principal Debt
and past-due interest accruing on any Principal Debt bears interest from the
date due (stated or by acceleration) at the Default Rate until paid, regardless
whether payment is made before or after entry of a judgment.
3.6 INTEREST RECAPTURE. If the designated interest rate applicable to
any amount exceeds the Maximum Rate, the interest rate on that amount is
limited to the Maximum Rate, but any subsequent reductions in the designated
rate shall not reduce the interest rate thereon below the Maximum Rate until
the total amount of accrued interest equals the amount of interest that would
have accrued if that designated rate had always been in effect. If at maturity
(stated or by acceleration), or at final payment of the Notes, the total
interest paid or accrued is less than the interest that would have accrued if
the designated rates had always been in effect, then, at that time and to the
extent lawful, Borrower shall pay an amount equal to the difference between (a)
the lesser of either the amount of interest that would have accrued if the
designated rates had always been in effect or the amount of interest that would
have accrued if the Maximum Rate had always been in effect, and (b) the amount
of interest actually paid or accrued on the Notes.
3.7 INTEREST CALCULATIONS. Interest will be calculated on the basis of
actual number of days (including the first day but excluding the last day)
elapsed but computed as if each calendar year consisted of 360 days (unless the
calculation would result in an interest rate greater than the Maximum Rate, or
in the case of Base-Rate Borrowing in which event interest will be calculated
on the basis of a year of 365 or 366 days, as the case may be). All interest
rate determinations and calculations by Administrative Agent are conclusive and
binding absent manifest error.
3.8 MAXIMUM RATE. Regardless of any provision contained in any Credit
Document, no Lender is entitled to contract for, charge, take, reserve,
receive, or apply, as interest on all or any part of the Obligation, any amount
in excess of the Maximum Rate, and, if any Lender ever does so, then any excess
shall be treated as a partial prepayment of principal (without regard to
SECTION 3.9) and any remaining excess shall be refunded to Borrower. In
determining if the interest paid or payable exceeds the Maximum Rate, Borrower
and Lenders shall, to the maximum extent lawful, (a) characterize any
nonprincipal payment as an expense, fee, or premium rather than as interest,
(b) exclude voluntary prepayments and their effects, and (c) amortize, prorate,
allocate, and spread the total amount of interest throughout the entire
contemplated term of the Principal Debt. However, if the Obligation is paid in
full before the end of its full contemplated term, and if the interest received
for its actual period of existence exceeds the Maximum Amount, then Lenders
shall refund any excess (and Lenders may not, to the extent lawful, be subject
to any penalties provided by any Legal Requirements for contracting for,
charging, taking, reserving, or receiving interest in
CREDIT AGREEMENT
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excess of the Maximum Amount). If the Legal Requirements of the State of Texas
are applicable for purposes of determining the "Maximum Rate" or the "Maximum
Amount," then those terms mean the "indicated rate ceiling" from time to time
in effect under Article 5069-1D.001, Revised Civil Statutes of Texas. Borrower
agrees that Chapter 346, Revised Civil Statutes of Texas (which regulates
certain revolving credit loan accounts and revolving triparty accounts) does
not apply to any Borrowings.
3.9 INTEREST PERIODS. When Borrower requests a LIBOR-Rate Borrowing,
Borrower may elect the applicable interest period (each an "INTEREST PERIOD"),
which may be, at Borrower's option, one, two, three, or six months for
LIBOR-Rate Borrowings, subject to SECTION 14.1 and the following conditions:
(a) the initial Interest Period for a LIBOR-Rate Borrowing commences on the
applicable Borrowing Date or conversion date, and each subsequent Interest
Period applicable to any Borrowing commences on the day when the next preceding
applicable Interest Period expires; (b) if any Interest Period for a LIBOR-Rate
Borrowing begins on a day for which no numerically corresponding Business Day
in the calendar month at the end of the Interest Period exists, then the
Interest Period ends on the last Business Day of that calendar month; (c) if
Borrower is required to pay any portion of a LIBOR-Rate Borrowing before the
end of its Interest Period in order to comply with the payment provisions of
the Credit Documents, Borrower shall also pay any related Funding Loss; and (d)
no more than six Interest Periods may be in effect at one time.
3.10 CONVERSIONS. Subject to the dollar limits of SECTION 2.1(b) and
provided that Borrower may not convert to or select a new Interest Period for a
LIBOR-Rate Borrowing at any time when an Event of Default or Potential Default
exists, Borrower may (a) convert a LIBOR-Rate Borrowing on the last day of the
applicable Interest Period to a Base-Rate Borrowing, (b) convert a Base-Rate
Borrowing at any time to a LIBOR-Rate Borrowing, and (c) elect a new Interest
Period for a LIBOR-Rate Borrowing to commence upon expiration of the
then-current Interest Period. That election may be made by telephonic request
to Administrative Agent no later than 10:00 a.m. on the second Business Day
before the conversion date or the last day of the Interest Period, as the case
may be (for conversion to a LIBOR-Rate Borrowing or election of a new Interest
Period), and no later than 11:00 a.m. on the last day of the Interest Period
(for conversion to a Base-Rate Borrowing). Borrower shall provide a Conversion
Notice to Administrative Agent no later than two days after the date of the
conversion or election. Absent Borrower's telephonic request for conversion or
election of a new Interest Period or if an Event of Default or Potential
Default exists, then, a LIBOR-Rate Borrowing shall be deemed converted to a
Base-Rate Borrowing effective when the applicable Interest Period expires.
3.11 ORDER OF APPLICATION. Each payment (including proceeds from the
exercise of any Rights) of the Obligation shall be applied either (a) if no
Event of Default or Potential Default exists, then in the order and manner as
Borrower directs, or (b) if an Event of Default or Potential Default exists or
if Borrower fails to give direction, then in the following order: (i) To all
fees, expenses, and indemnified amounts for which Administrative Agent has not
been paid or reimbursed in accordance with the Credit Documents and -- except
while an Event of Default under SECTION 11.1 exists -- as to which Borrower has
been invoiced and has failed to pay within ten Business Days of that invoice;
(ii) to all fees, expenses, and indemnified amounts for which any Lender has
not been paid or reimbursed in accordance with the Credit Documents (and if any
payment is less than all unpaid or unreimbursed fees and expenses, then that
payment shall be paid against unpaid and unreimbursed fees and expenses in the
order of incurrence or due date) and -- except while an Event of Default under
SECTION 11.1 exists -- as to which Borrower has been invoiced and has failed to
pay within ten Business Days of that invoice; (iii) to accrued interest on the
Principal Debt; (iv) to the Principal Debt in the order as Required Lenders may
elect (but Required Lenders agree to apply proceeds in an order
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that will minimize any Funding Loss); and (v) to the remaining Obligation in
the order and manner Required Lenders deem appropriate.
3.12 SHARING OF PAYMENTS, ETC. Except as otherwise specifically
provided (a) principal and interest payments shall be shared by Lenders in
accordance with their respective Commitment Percentages while no Event of
Default exists or their respective Default Percentages while an Event of
Default exists, and (b) each other payment on the Obligation shall be shared by
Lenders in the proportion that the Obligation is owed to Lenders on the date of
the payment. If any Lender obtains any payment or prepayment with respect to
the Obligation (whether voluntary, involuntary, or otherwise, including,
without limitation, as a result of exercising its Rights under the SECTION
3.13) that exceeds the part of that payment or prepayment that it is then
entitled to receive under the Credit Documents, then that Lender shall purchase
from the other Lenders participations that will cause the purchasing Lender to
share the excess payment or prepayment ratably with each other Lender. If all
or any portion of any excess payment or prepayment is subsequently recovered
from the purchasing Lender, then the purchase shall be rescinded and the
purchase price restored to the extent of the recovery. Borrower agrees that any
Lender purchasing a participation from another Lender under this section may,
to the fullest extent lawful, exercise all of its Rights of payment (including
the Right of offset) with respect to that participation as fully as if that
Lender were the direct creditor of Borrower in the amount of that
participation.
3.13 OFFSET. If an Event of Default exists, each Lender is entitled to
exercise (for the benefit of all Lenders) the Rights of offset and banker's
Lien against each and every account and other property, or any interest
therein, that Borrower or any Guarantor may now or hereafter have with, or
which is now or hereafter in the possession of, that Lender to the extent of
the full amount of the Obligation then matured and owed (directly or
participated) to it.
3.14 BOOKING BORROWINGS. To the extent lawful, any Lender may make,
carry, or transfer its Borrowings at, to, or for the account of any of its
branch offices or the office or branch of any of its Affiliates. However, no
Affiliate or branch is entitled to receive any greater payment under SECTION
3.15 than the transferor Lender would have been entitled to receive with
respect to those Borrowings, and a transfer may not be made if, as a direct
result of it, SECTION 3.15 or 3.17 would apply to any of the Obligation. If any
of the conditions of SECTIONS 3.16 or 3.17 ever apply to a Lender, that Lender
shall, to the extent possible, carry or transfer its Borrowings at, to, or for
the account of any of its branch offices or the office or branch of any of its
Affiliates so long as the transfer is consistent with the other provisions of
this section, does not create any burden or adverse circumstance for that
Lender that would not otherwise exist, and eliminates or ameliorates the
conditions of SECTIONS 3.16 or 3.17 as applicable.
3.15 BASIS UNAVAILABLE OR INADEQUATE FOR LIBOR RATE. If, on or before
any date when a LIBOR Rate is to be determined for a Borrowing, Administrative
Agent reasonably determines that the basis for determining the applicable rate
is not available or any Lender reasonably determines that the resulting rate
does not accurately reflect the cost to that Lender of making or converting
Borrowings at that rate for the applicable Interest Period, then Administrative
Agent shall promptly notify Borrower and Lenders of that determination (which
is conclusive and binding on Borrower absent manifest error) and the applicable
Borrowing shall bear interest at the sum of the Base Rate plus the Applicable
Margin. Until Administrative Agent notifies Borrower that those circumstances
no longer exist, Lenders' commitments under this agreement to make, or to
convert to, LIBOR-Rate Borrowings, as the case may be, are suspended.
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3.16 ADDITIONAL COSTS.
(a) RESERVES. With respect to any LIBOR-Rate Borrowing (i) if
any change in any present Legal Requirement, any change in the
interpretation or application of any present Legal Requirement, or any
future Legal Requirement imposes, modifies, or deems applicable (or if
compliance by any Lender with any requirement of any Governmental
Authority results in) any requirement that any reserves (including,
without limitation, any marginal, emergency, supplemental, or special
reserves) be maintained (other than any reserve included in the
Reserve Requirement), and (ii) if those reserves reduce any sums
receivable by that Lender under this agreement or increase the costs
incurred by that Lender in advancing or maintaining any portion of any
LIBOR-Rate Borrowing, then (iii) that Lender (through Administrative
Agent) shall deliver to Borrower a certificate setting forth in
reasonable detail the calculation of the amount necessary to
compensate it for its reduction or increase (which certificate is
conclusive and binding absent manifest error), and (iv) Borrower shall
pay that amount to that Lender within five Business Days after demand.
The provisions of and undertakings and indemnification in this CLAUSE
(a) survive the satisfaction and payment of the Obligation and
termination of this agreement.
(b) CAPITAL ADEQUACY. With respect to any Borrowing, if any
change in any present Legal Requirement (whether or not having the
force of law), any change in the interpretation or application of any
present Legal Requirement (whether or not having the force of law), or
any future Legal Requirement (whether or not having the force of law)
regarding capital adequacy, or if compliance by any Lender with any
request, directive, or requirement imposed in the future by any
Governmental Authority regarding capital adequacy, or if any change by
any Lender, its holding company, or its applicable lending office in
its written policies or in the risk category of this transaction, in
any of the foregoing events or circumstances, reduces the rate of
return on its capital as a consequence of its obligations under this
agreement to a level below that which it otherwise could have achieved
(taking into consideration its policies with respect to capital
adequacy) by an amount deemed by it to be material (and it may, in
determining the amount, utilize reasonable assumptions and allocations
of costs and expenses and use any reasonable averaging or attribution
method), then (unless the effect is already reflected in the rate of
interest then applicable under this agreement) Administrative Agent or
that Lender (through Administrative Agent) shall notify Borrower and
deliver to Borrower a certificate setting forth in reasonable detail
the calculation of the amount necessary to compensate it (which
certificate is conclusive and binding absent manifest error), and
Borrower shall pay that amount to Administrative Agent or that Lender
within five Business Days after demand. The provisions of and
undertakings and indemnification in this CLAUSE (B) shall survive the
satisfaction and payment of the Obligation and termination of this
agreement.
(c) TAXES. Subject to SECTION 3.19, any Taxes payable by
Administrative Agent or any Lender or ruled (by a Governmental
Authority) payable by Administrative Agent or any Lender in respect of
this agreement or any other Credit Document shall, if permitted by
Legal Requirement, be paid by Borrower, together with interest and
penalties, if any, except for Taxes payable on or measured by the
overall net income or capital of Administrative Agent or that Lender
(or Administrative Agent or that Lender, as the case may be, together
with any other Person with whom Administrative Agent or that Lender
files a consolidated, combined, unitary, or similar Tax return) and
except for interest and penalties incurred as a result of the gross
negligence or willful misconduct of Administrative Agent or any
Lender. Administrative Agent or that Lender (through
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Administrative Agent) shall notify Borrower and deliver to Borrower a
certificate setting forth in reasonable detail the calculation of the
amount of payable Taxes, which certificate is conclusive and binding
(absent manifest error), and Borrower shall pay that amount to
Administrative Agent for its account or the account of that Lender, as
the case may be within five Business Days after demand. If
Administrative Agent or that Lender subsequently receives a refund of
the Taxes paid to it by Borrower, then the recipient shall promptly
pay the refund to Borrower.
3.17 CHANGE IN LEGAL REQUIREMENTS. If any Legal Requirement makes it
unlawful for any Lender to make or maintain LIBOR-Rate Borrowings, then that
Lender shall promptly notify Borrower and Administrative Agent, and (a) as to
undisbursed funds, that requested Borrowing shall be made as a Base- Rate
Borrowing, and (b) as to any outstanding Borrowing (i) if maintaining the
Borrowing until the last day of the applicable Interest Period is unlawful,
then the Borrowing shall be converted to a Base-Rate Borrowing as of the date
of notice, in which event Borrower will not be required to pay any related
Funding Loss, or (ii) if not prohibited by Legal Requirement, then the
Borrowing shall be converted to a Base-Rate Borrowing as of the last day of the
applicable Interest Period, or (iii) if any conversion will not resolve the
unlawfulness, then Borrower shall promptly prepay the Borrowing, without
penalty but with related Funding Loss.
3.18 FUNDING LOSS. BORROWER SHALL INDEMNIFY EACH LENDER AGAINST, AND
PAY TO IT UPON DEMAND, ANY FUNDING LOSS OF THAT LENDER. WHEN ANY LENDER DEMANDS
THAT BORROWER PAY ANY FUNDING LOSS, THAT LENDER SHALL DELIVER TO BORROWER AND
ADMINISTRATIVE AGENT A CERTIFICATE SETTING FORTH IN REASONABLE DETAIL THE BASIS
FOR IMPOSING FUNDING LOSS AND THE CALCULATION OF THE AMOUNT, WHICH CALCULATION
IS CONCLUSIVE AND BINDING ABSENT MANIFEST ERROR. THE PROVISIONS OF AND
UNDERTAKINGS AND INDEMNIFICATION IN THIS SECTION SURVIVE THE SATISFACTION AND
PAYMENT OF THE OBLIGATION AND TERMINATION OF THIS AGREEMENT.
3.19 FOREIGN LENDERS, PARTICIPANTS, AND ASSIGNEES. Each Lender,
Participant (by accepting a participation interest under this agreement), and
Assignee (by executing an Assignment) that is not organized under the Legal
Requirements of the United States of America or one of its states (a)
represents to Administrative Agent and Borrower that (i) no Taxes are required
to be withheld by Administrative Agent or Borrower with respect to any payments
to be made to it in respect of the Obligation and (ii) it has furnished to
Administrative Agent and Borrower two duly completed copies of either U.S.
Internal Revenue Service Form 4224, Form 1001, Form W-8, or any other form
acceptable to Administrative Agent and Borrower that entitles it to a complete
exemption from U.S. federal withholding Tax on all interest or fee payments
under the Credit Documents, and (b) covenants to (i) provide Administrative
Agent and Borrower a new Form 4224, Form 1001, Form W-8, or other form
acceptable to Administrative Agent and Borrower upon the expiration or
obsolescence according to Legal Requirement of any previously delivered form,
duly executed and completed by it, entitling it to a complete exemption from
U.S. federal withholding Tax on all interest and fee payments under the Credit
Documents, and (ii) comply from time to time with all Legal Requirements with
regard to the withholding Tax exemption. If any of the foregoing is not true at
any time or the applicable forms are not provided, then Borrower and
Administrative Agent (without duplication) may deduct and withhold from
interest and fee payments under the Credit Documents any Tax at the maximum
rate under the IRC or other applicable Legal Requirement, and amounts so
deducted and withheld shall be treated as paid to that Lender, Participant, or
assignee, as the case may be, for all purposes under the Credit Documents.
3.20 DISCHARGE AND REINSTATEMENT. Each Company's obligations under the
Credit Documents remain in full force and effect until no Lender has any
commitment to extend credit under the Credit Documents and the Obligation is
fully paid (except for provisions under the Credit Documents which by their
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terms expressly survive payment of the Obligation and termination of the Credit
Documents). If any payment under any Credit Document is ever rescinded or must
be restored or returned for any reason, then all Rights and obligations under
the Credit Documents in respect of that payment are automatically reinstated as
though the payment had not been made when due.
SECTION 4 FEES.
4.1 TREATMENT OF FEES. The fees described in this SECTION 4 (a) are
not compensation for the use, detention, or forbearance of money, (b) are in
addition to, and not in lieu of, interest and expenses otherwise described in
this agreement, (c) are payable in accordance with SECTION 3.1, (d) are
non-refundable, (e) to the fullest extent permitted by Legal Requirement, bear
interest, if not paid when due, at the Default Rate, and (f) are calculated on
the basis of a year of 365 or 366 days, as the case may be.
4.2 COMMITMENT FEE. Borrower shall pay to Administrative Agent (solely
for their respective accounts) a commitment fee for Lenders according to each
Lender's Commitment Percentage. The fee is payable as it accrues on the last
day of each March, June, September, and December (commencing on the first of
those dates that follows the date of this agreement) and as it accrues on the
Termination Date. Each payment of the fee is equal to the following, determined
for the calendar quarter (or portion of a calendar quarter commencing on the
date of this agreement or ending on the Termination Date) preceding and
including the date it is due: From the date of this agreement until the
Termination Date, the product of (i) the Applicable Percentage, times (ii) the
amount by which the average-daily total Commitments exceed the average-daily
Principal Debt, times (iii) a fraction with the number of days in the
applicable quarter or portion of it as the numerator and 365 or 366, as
applicable, as the denominator.
SECTION 5 CONDITIONS PRECEDENT. No Lender is obligated to fund the initial
Borrowing unless Administrative Agent has received all of the items described
in SCHEDULE 5. In addition, no Lender is obligated to fund (as opposed to
continue or convert) any Borrowing unless on the applicable Borrowing Date (and
after giving effect to the requested Borrowing): (a) Administrative Agent has
timely received a properly completed and duly executed Borrowing Request; (b)
all of the representations and warranties of TEPPCO Partners and the Companies
in the Credit Documents are true and correct in all material respects (unless
they speak to a specific date or are based on facts which have changed by
transactions contemplated or expressly permitted by this agreement); (c) no
Material-Adverse Event, Event of Default, or Potential Default exists; and (d)
no limitation in SECTION 2.1 is exceeded. Each Borrowing Request, however
delivered, constitutes Borrower's representation and warranty that the
conditions in CLAUSES (b) through (e) above are satisfied. Upon Administrative
Agent's or any Lender's reasonable request, Borrower shall deliver to
Administrative Agent or such Lender evidence substantiating any of the matters
in the Credit Documents that are necessary to enable Borrower to qualify for
the Borrowing. Each condition precedent in this agreement (including, without
limitation, those on SCHEDULE 5) is material to the transactions contemplated
by this agreement, and time is of the essence with respect to each condition
precedent.
SECTION 6 GUARANTIES. Borrower shall cause TEPPCO Partners, TCTM, and TCTM's
Subsidiaries (other than Borrower), whether now existing or in the future
formed or acquired as permitted by the Credit Documents, to unconditionally
guarantee the full payment and performance of the Obligation by execution of a
Guaranty.
SECTION 7 REPRESENTATIONS AND WARRANTIES. Borrower represents and warrants to
Administrative Agent and Lenders as follows:
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7.1 PURPOSE. (a) Borrower will only use the proceeds of Borrowings for
general working capital purposes, including acquisitions and capital
expenditures, and (b) no Company is engaged principally, or as one of its
important activities, in the business of extending credit for the purpose of
purchasing or carrying any "margin stock" within the meaning of Regulation U of
the Board of Governors of the Federal Reserve System, as amended and no part of
the proceeds of any Borrowing will be used, directly or indirectly, for a
purpose that violates any Governmental Requirement, including, without
limitation, Regulation U.
7.2 SUBSIDIARIES. SCHEDULE 7.2 describes TEPPCO Partners' and TCTM and
all of its direct and indirect Subsidiaries.
7.3 EXISTENCE, AUTHORITY, AND GOOD STANDING. Each Guarantor and each
Company is duly organized, validly existing, and in good standing under the
Legal Requirements of its jurisdiction of formation. Except where not a
Material-Adverse Event, each Guarantor and each Company is duly qualified to
transact business and is in good standing in each jurisdiction where the nature
and extent of its business and properties require due qualification and good
standing (each of which jurisdictions is identified on SCHEDULE 7.2). Each
Guarantor and each Company possesses all requisite authority and power to
conduct its business as is now being conducted and as proposed under the Credit
Documents to be conducted and to own and operate its assets as now owned and
operated and as proposed to be owned and operated under the Credit Documents.
7.4 AUTHORIZATION AND CONTRAVENTION. The execution and delivery by
each Guarantor and each Company of each Credit Document to which it is a party
and the performance by it of its obligations under those Credit Documents (a)
are within its corporate, partnership, or comparable organizational powers, (b)
have been duly authorized by all necessary corporate, partnership, or
comparable organizational action, (c) require no notice to, consents or
approval of, action by or filing with, any Governmental Authority (except any
action or filing that has been taken or made on or before the Closing Date),
(d) do not violate any provision of any of its Constituent Documents, and (e)
except violations that individually or collectively are not a Material-Adverse
Event, do not violate any provision of Legal Requirement applicable to it or
any material agreement to which it is a party.
7.5 BINDING EFFECT. Upon execution and delivery by all parties to it,
each Credit Document will constitute a legal and binding obligation of each
Guarantor and each Company party to it, enforceable against it in accordance
with that Credit Document's terms except as that enforceability may be limited
by Debtor Laws and general principles of equity.
7.6 CURRENT FINANCIALS. The Current Financials were prepared in
accordance with GAAP and present fairly, in all material respects, the
consolidated financial condition, results of operations, and cash flows of the
Companies as of, and for the portion of the fiscal year ending on their dates
(subject only to normal year-end adjustments for interim statements). Except
for transactions directly related to, specifically contemplated by, or
expressly permitted by the Credit Documents, no material adverse changes have
occurred in such consolidated financial condition from that shown in the
Current Financials.
7.7 SOLVENCY. Each of Borrower and each Guarantor is Solvent.
7.8 LITIGATION. Except as disclosed on SCHEDULE 7.8 and matters
covered (subject to reasonable and customary deductible and retention) by
insurance or indemnification agreements as to which the insurer
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or indemnifying party, as applicable, has acknowledged liability (a) no
Guarantor or Company is subject to, or aware of the threat of, any Litigation
that is reasonably likely to be determined adversely to any Guarantor or
Company and, if so adversely determined, is a Material-Adverse Event, and (b)
no outstanding and unpaid judgments against any Guarantor or Company exist that
would be a Material-Adverse Event.
7.9 TAXES. Except where not a Material-Adverse Event (a) all Tax
returns of each Guarantor and each Company required to be filed have been filed
(or extensions have been granted) before delinquency, and (b) all Taxes imposed
upon each Guarantor and Company that are due and payable have been paid before
delinquency except as being contested as permitted by SECTION 8.5.
7.10 ENVIRONMENTAL MATTERS. Except as disclosed on SCHEDULE 7.10 (a)
no Guarantor or Company has received notice from any Governmental Authority
that it has actual or potential Environmental Liability and no Guarantor or
Company has knowledge that it has any Environmental Liability, which actual or
potential Environmental Liability in either case constitutes a Material-Adverse
Event, and (b) no Guarantor or Company has received notice from any
Governmental Authority that any Real Property is affected by, and no Guarantor
or Company has knowledge that any Real Property is affected by, any Release of
any Hazardous Substance which constitutes a Material-Adverse Event.
7.11 EMPLOYEE PLANS. Except as disclosed on SCHEDULE 7.11 or where not
a Material-Adverse Event (a) no Employee Plan subject to ERISA has incurred an
"accumulated funding deficiency" (as defined in Section 302 of ERISA or Section
512 of the IRC), (b) neither Borrower nor any ERISA Affiliate has incurred
liability -- except for liabilities for premiums that have been paid or that
are not past due -- under ERISA to the PBGC in connection with any Employee
Plan, (c) neither Borrower nor any ERISA Affiliate has withdrawn in whole or in
part from participation in a Multiemployer Plan in a manner that has given rise
to a withdrawal liability under Title IV of ERISA, (d) neither Borrower nor any
ERISA Affiliate has engaged in any "prohibited transaction" (as defined in
Section 406 of ERISA or Section 4975 of the IRC), (e) no "reportable event" (as
defined in Section 4043 of ERISA) has occurred excluding events for which the
notice requirement is waived under applicable PBGC regulations, (f) neither
Borrower nor any ERISA Affiliate has any liability, or is subject to any Lien,
under ERISA or the IRC to or on account of any Employee Plan, (g) each Employee
Plan subject to ERISA and the IRC complies in all material respects, both in
form and operation, with ERISA and the IRC, and (h) no Multiemployer Plan
subject to the IRC is in reorganization within the meaning of Section 418 of
the IRC. None of the matters disclosed on SCHEDULE 7.11 give rise to any other
"reportable events," as defined above.
7.12 DEBT. No Guarantor or Company has any Debt except as described on
SCHEDULE 7.12.
7.13 PROPERTIES; LIENS. Each Company has good and indefeasible title
to all of its property reflected on the Current Financials as being owned by it
except for property that is obsolete or that has been disposed of in the
ordinary course of business between the date of the Current Financials and the
date of this agreement or, after the date of this agreement, as permitted by
SECTIONS 9.9 and 9.10. No Lien exists on any property of any Company except as
described on SCHEDULE 7.13 and other Permitted Liens. No Company is party or
subject to any agreement, instrument, or order which in any way restricts any
Company's ability to allow Liens to exist upon any of its assets except
relating to Permitted Liens.
7.14 GOVERNMENT REGULATIONS. No Guarantor or Company is subject to
regulation under the Investment Company Act of 1940 or the Public Utility
Holding Company Act of 1935.
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7.15 TRANSACTIONS WITH AFFILIATES. Except as otherwise disclosed on
SCHEDULE 7.15 or permitted by SECTION 9.5, no Guarantor or Company is a party
to a material transaction with any of its Affiliates.
7.16 LEASES. Except where not a Material-Adverse Event (a) each
Company enjoys peaceful and undisturbed possession under all leases necessary
for the operation of its properties and assets, and (b) all material leases
under which any Company is a lessee are in full force and effect.
7.17 LABOR MATTERS. Except where not a Material-Adverse Event (a) no
actual or threatened strikes, labor disputes, slow downs, walkouts, work
stoppages, or other concerted interruptions of operations that involve any
employees employed at any time in connection with the business activities or
operations at the Real Property exist, (b) hours worked by and payment made to
the employees of any Company or any Predecessor have not been in violation of
the Fair Labor Standards Act or any other applicable Legal Requirements
pertaining to labor matters, (c) all payments due from any Company for employee
health and welfare insurance, including, without limitation, workers
compensation insurance, have been paid or accrued as a liability on its books,
(d) the business activities and operations of each Company are in compliance
with OSHA and other applicable health and safety Legal Requirements.
7.18 INTELLECTUAL PROPERTY. Except where not a Material-Adverse Event
(a) each Company owns or has the right to use all material licenses, patents,
patent applications, copyrights, service marks, trademarks, trademark
applications and trade names necessary to continue to conduct its businesses as
presently conducted by it and proposed to be conducted by it immediately after
the date of this agreement, (b) each Company is conducting its business without
infringement or claim of infringement of any license, patent, copyright,
service xxxx, trademark, trade name, trade secret or other intellectual
property right of others, and (c) no infringement or claim of infringement by
others of any material license, patent, copyright, service xxxx, trademark,
trade name, trade secret or other intellectual property of any Company exists.
7.19 Y2K ISSUE. Each Guarantor and each Company has (a) initiated a
review and assessment of all areas within businesses and operations (including
those affected by suppliers and vendors) that could be adversely affected by
the Y2K Issue, (b) developed a plan and time line for addressing the Y2K Issue
on a timely basis, and (c) to date implemented in all material respects that
plan in accordance with that timetable.
7.20 FULL DISCLOSURE. Each fact or condition relating to any
Guarantor's or any Company's financial condition, business, or property that is
a Material-Adverse Event has been disclosed in writing to Administrative Agent.
All information previously furnished by any Guarantor or Company to
Administrative Agent in connection with the Credit Documents was (and all
information furnished in the future by any Company to Administrative Agent will
be) true and accurate in all material respects or based on reasonable estimates
on the date the information is stated or certified.
SECTION 8 AFFIRMATIVE COVENANTS. As long as any Lender is committed to lend
under this agreement and until the Obligation has been fully paid and
performed, Borrower covenants and agrees with Administrative Agent and Lenders
that, without first obtaining Required Lenders' consent to the contrary:
8.1 CERTAIN ITEMS FURNISHED. Borrower shall cause the following to be
furnished to each Lender:
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(a) ANNUAL FINANCIALS OF TEPPCO PARTNERS. Promptly after
preparation but no later than 90 days after the last day of each
fiscal year of TEPPCO Partners, Financials showing the consolidated
and consolidating financial condition and results of operations of
TEPPCO Partners and its Subsidiaries as of, and for the year ended on,
that last day setting forth in comparative form the figures for the
previous fiscal year, accompanied by (i) the opinion, without material
qualification, of KPMG LLP or other firm of nationally-recognized
independent certified public accountants reasonably acceptable to
Required Lenders, based on an audit using generally accepted auditing
standards, that those Financials were prepared in accordance with GAAP
and present fairly, in all material respects, the consolidated and
consolidating financial condition and results of operations of TEPPCO
Partners and its Subsidiaries, and (ii) a related Compliance
Certificate, together with a completed copy of the schedule to that
certificate, from a Responsible Officer, on behalf of TEPPCO Partners.
(b) ANNUAL FINANCIALS OF THE COMPANIES AND OF BORROWER.
Promptly after preparation but no later than 90 days after the last
day of each fiscal year of the Companies, Financials showing the
consolidated and consolidating financial condition and results of
operations of the Companies and of Borrower and its Subsidiaries as
of, and for the year ended on, that last day setting forth in
comparative form the figures for the previous fiscal year, accompanied
by (i) a letter from KPMG LLP or other firm of nationally-recognized
independent certified public accountants reasonably acceptable to
Required Lenders stating that, in connection with the audit of TEPPCO
Partners, such firm reviewed such Financials of the Companies and of
Borrower and its Subsidiaries, and (ii) related Compliance
Certificates, together with, in respect of TCTM only, a completed copy
of the schedule to its certificate, from a Responsible Officer, on
behalf of TCTM and Borrower, respectively.
(c) QUARTERLY FINANCIALS. Promptly after preparation but no
later than 45 days after the last day of each of the first three
fiscal quarters of TEPPCO Partners and the Companies each year,
Financials showing the consolidated and consolidating financial
condition and results of operations of TEPPCO Partners and its
Subsidiaries, of the Companies, and of Borrower and its Subsidiaries
for that fiscal quarter and for the period from the beginning of the
current fiscal year to the last day of that fiscal quarter setting
forth in each case in comparative form the figures for the
corresponding quarter and the corresponding portion of the previous
fiscal quarter, accompanied in each case by a related Compliance
Certificate, together with a completed copy of the schedule to that
certificate, signed by a Responsible Officer, on behalf of TEPPCO
Partners, TCTM, and Borrower, as the case may be.
(d) OTHER REPORTS. Promptly after preparation and
distribution, accurate and complete copies of all reports and other
material communications about material financial matters or material
corporate plans or projections by or for any Guarantor or any Company
for distribution to any Governmental Authority or any creditor, other
than credit, trade, and other reports prepared and distributed in the
ordinary course of business and information otherwise furnished to
Administrative Agent and Lenders under this agreement.
(e) EMPLOYEE PLANS. As soon as possible and within 30 days
after any Guarantor or any Company knows that any event which would
constitute a reportable event under Section 4043(b) of Title IV of
ERISA with respect to any Employee Plan subject to ERISA has occurred,
or that the PBGC has instituted or will institute proceedings under
ERISA to terminate that plan, deliver a
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certificate of a Responsible Officer on behalf of Borrower setting
forth details as to that reportable event and the action which
Borrower or an ERISA Affiliate, as the case may be, proposes to take
with respect to it, together with a copy of any notice of that
reportable event which may be required to be filed with the PBGC, or
any notice delivered by the PBGC evidencing its intent to institute
those proceedings or any notice to the PBGC that the plan is to be
terminated, as the case may be. For all purposes of this section, each
Guarantor and any Company is deemed to have all knowledge of all facts
attributable to the plan administrator under ERISA.
(f) OTHER NOTICES. Notice, promptly after Borrower knows, of
(i) the existence and status of any Litigation that is reasonably
likely to be adversely determined and, if determined adversely to any
Guarantor or any Company, would be a Material-Adverse Event, (ii) any
change in any material fact or circumstance represented or warranted
by any Guarantor or any Company in any Credit Document, (iii) an Event
of Default or Potential Default, specifying the nature thereof and
what action the Companies have taken, are taking, or propose to take.
(g) Y2K. Notice promptly after either of Borrower or any
Guarantor discovers or determines that any computer applications
(including those of suppliers and vendors to any Guarantor or any
Company) that are material to the businesses or operations of any
Guarantor or any Company will not be compliant in timely resolving the
Y2K Issue if that failure could reasonably be expected to be a
Material-Adverse Event.
(h) OTHER INFORMATION. Promptly when reasonably requested by
Administrative Agent or any Lender, such reasonable information (not
otherwise required to be furnished under this agreement) about any
Guarantor or any Company's business affairs, assets, and liabilities.
8.2 USE OF CREDIT. Borrower shall use the proceeds of Borrowings only
for the purposes represented in this agreement.
8.3 BOOKS AND RECORDS. Each Guarantor and Company shall maintain
books, records, and accounts necessary to prepare Financials in accordance with
GAAP.
8.4 INSPECTIONS. Upon reasonable request and subject to compliance
with applicable safety standards, with contractual privilege and non-disclosure
agreements, and with the same conditions applicable to any Guarantor or any
Company in respect of property of that Guarantor or Company on the premises of
other Persons, each Guarantor and Company shall allow Administrative Agent or
any Lender (or their respective Representatives) to inspect any of its
properties, to review reports, files, and other records and to make and take
away copies thereof, to conduct reasonable tests or investigations, and to
discuss any of its affairs, conditions, and finances with its other creditors,
directors, officers, employees, or representatives from time to time, during
reasonable business hours.
8.5 TAXES. Each Guarantor and Company shall promptly pay when due any
and all Taxes except Taxes that are being contested in good faith by lawful
proceedings diligently conducted, against which reserve or other provision
required by GAAP has been made, and in respect of which levy and execution of
any Lien sufficient to be enforced has been and continues to be stayed.
CREDIT AGREEMENT
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8.6 PAYMENT OF OBLIGATION. Each Guarantor and Company shall promptly
pay (or renew and extend) all of its material obligations as they become due
(unless the obligations are being contested in good faith by, if required,
appropriate proceedings).
8.7 EXPENSES. Within ten Business Days after demand accompanied by an
invoice describing the costs, fees, and expenses in reasonable detail (and
subject to any limitations separately agreed to in writing by Borrower and
Administrative Agent in respect of costs, fees, and expenses of Administrative
Agent or any of its Representatives), Borrower shall pay (a) all costs, fees,
and reasonable expenses paid or incurred by Administrative Agent incident to
any Credit Document (including the reasonable fees and expenses of
Administrative Agent's counsel in connection with the negotiation, preparation,
delivery, and execution of the Credit Documents and any related amendment,
waiver, or consent) and (b) all reasonable costs and expenses incurred by
Administrative Agent or any Lender in connection with the enforcement of the
obligations of any Company under the Credit Documents or the exercise of any
Rights under the Credit Documents (including reasonable attorneys' fees and
court costs), all of which are part of the Obligation, bearing interest, (if
not paid within ten Business Days after demand accompanied by an invoice
describing the costs, fees, and expenses in reasonable detail) on the portion
thereof from time to time unpaid at the Default Rate until paid.
8.8 MAINTENANCE OF EXISTENCE, ASSETS, AND BUSINESS. Each Guarantor and
Company shall (a) except in connection with dispositions permitted under
SECTION 9.9 and mergers, consolidations, and dissolutions permitted under
SECTION 9.10, maintain its existence and good standing in its state of
formation, and (b) except where not a Material-Adverse Event (i) maintain its
authority to transact business and good standing in all other states, (ii)
maintain all licenses, permits, and franchises (including Environmental
Permits) necessary for its business, and (iii) keep all of its material assets
that are useful in and necessary to its business in good working order and
condition (ordinary wear and tear excepted) and make all necessary repairs and
replacements.
8.9 INSURANCE. Each Guarantor and Company shall, at its cost and
expense, maintain with financially sound, responsible, and reputable insurance
companies or associations (or, as to workers' compensation or similar
insurance, with an insurance fund or by self-insurance authorized by the
jurisdictions in which it operates) insurance concerning its properties and
businesses against casualties and contingencies and of types and in amounts
(and with co-insurance and deductibles) as is customary in the case of similar
businesses.
8.10 ENVIRONMENTAL MATTERS. Each Guarantor and Company shall (a)
operate and manage its businesses and otherwise conduct its affairs in
compliance with all Environmental Laws and Environmental Permits except to the
extent noncompliance does not constitute a Material-Adverse Event, (b) promptly
deliver to Administrative Agent a copy of any notice received from any
Governmental Authority alleging that Guarantor or any Company is not in
compliance with any Environmental Law or Environmental Permit if the allegation
constitutes a Material-Adverse Event, and (c) promptly deliver to
Administrative Agent a copy of any notice received from any Governmental
Authority alleging that any Guarantor or any Company has any potential
Environmental Liability if the allegation constitutes a Material-Adverse Event.
8.11 INDEMNIFICATION.
(a) AS USED IN THIS SECTION: (I) "INDEMNITEE" MEANS
ADMINISTRATIVE AGENT, EACH LENDER, EACH PRESENT AND FUTURE AFFILIATE
(WITH WHOM BORROWER OR A
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GUARANTOR HAS ENTERED INTO A WRITTEN CONTRACTUAL ARRANGEMENT) OF
ADMINISTRATIVE AGENT OR ANY LENDER, EACH PRESENT AND FUTURE
REPRESENTATIVE OF ADMINISTRATIVE AGENT, ANY LENDER, OR ANY OF THOSE
AFFILIATES, AND EACH PRESENT AND FUTURE SUCCESSOR AND PERMITTED ASSIGN
OF ADMINISTRATIVE AGENT, ANY LENDER, OR ANY OF THOSE AFFILIATES OR
REPRESENTATIVES; AND (II) "INDEMNIFIED LIABILITIES" MEANS ALL KNOWN
AND UNKNOWN, FIXED AND CONTINGENT, ADMINISTRATIVE, INVESTIGATIVE,
JUDICIAL, AND OTHER CLAIMS, DEMANDS, ACTIONS, CAUSES OF ACTION,
INVESTIGATIONS, SUITS, PROCEEDINGS, AMOUNTS PAID IN SETTLEMENT,
DAMAGES, JUDGMENTS, PENALTIES, COURT COSTS, LIABILITIES, AND
OBLIGATIONS -- AND ALL COSTS AND REASONABLE EXPENSES, AND
DISBURSEMENTS (INCLUDING ALL REASONABLE ATTORNEYS' FEES AND EXPENSES
WHETHER OR NOT SUIT OR OTHER PROCEEDING EXISTS OR ANY INDEMNITEE IS
PARTY TO ANY SUIT OR OTHER PROCEEDING) IN ANY WAY RELATED TO ANY OF
THE FOREGOING -- THAT MAY AT ANY TIME BE IMPOSED ON, INCURRED BY, OR
ASSERTED AGAINST ANY INDEMNITEE AND IN ANY WAY ARISING OUT OF ANY (A)
CREDIT DOCUMENT, TRANSACTION CONTEMPLATED BY ANY CREDIT DOCUMENT, OR
REAL PROPERTY, (B) ENVIRONMENTAL LIABILITY IN ANY WAY RELATED TO ANY
GUARANTOR OR ANY COMPANY, PREDECESSOR, REAL PROPERTY, OR ACT,
OMISSION, STATUS, OWNERSHIP, OR OTHER RELATIONSHIP, CONDITION, OR
CIRCUMSTANCE CONTEMPLATED BY, CREATED UNDER, OR ARISING PURSUANT TO OR
IN CONNECTION WITH ANY CREDIT DOCUMENT, OR (C) INDEMNITEE'S SOLE OR
CONCURRENT ORDINARY NEGLIGENCE.
(b) BORROWER SHALL INDEMNIFY EACH INDEMNITEE FROM AND
AGAINST, PROTECT AND DEFEND EACH INDEMNITEE FROM AND AGAINST, HOLD
EACH INDEMNITEE HARMLESS FROM AND AGAINST, AND ON DEMAND PAY OR
REIMBURSE EACH INDEMNITEE FOR, ALL INDEMNIFIED LIABILITIES.
(c) THE FOREGOING PROVISIONS (i) ARE NOT LIMITED IN AMOUNT
EVEN IF THAT AMOUNT EXCEEDS THE OBLIGATION, (ii) INCLUDE, WITHOUT
LIMITATION, REASONABLE FEES AND EXPENSES OF ATTORNEYS AND OTHER COSTS
AND EXPENSES OF LITIGATION OR PREPARING FOR LITIGATION AND DAMAGES OR
INJURY TO PERSONS, PROPERTY, OR NATURAL RESOURCES ARISING UNDER ANY
STATUTORY OR COMMON LEGAL REQUIREMENT, PUNITIVE DAMAGES, FINES, AND
OTHER PENALTIES, AND (iii) ARE NOT AFFECTED BY THE SOURCE OR ORIGIN OF
ANY HAZARDOUS SUBSTANCE, AND (iv) ARE NOT AFFECTED BY ANY INDEMNITEE'S
INVESTIGATION, ACTUAL OR CONSTRUCTIVE KNOWLEDGE, COURSE OF DEALING, OR
WAIVER.
(d) HOWEVER, NO INDEMNITEE IS ENTITLED TO BE INDEMNIFIED
UNDER THE CREDIT DOCUMENTS FOR ITS OWN SOLE GROSS NEGLIGENCE OR SOLE
WILFUL MISCONDUCT.
(e) THE PROVISIONS OF AND INDEMNIFICATION AND OTHER
UNDERTAKINGS UNDER THIS SECTION SURVIVE THE SALE OR OTHER TRANSFER OF
ANY REAL PROPERTY TO ANY PERSON, THE SATISFACTION OF THE OBLIGATION,
AND THE TERMINATION OF THE CREDIT DOCUMENTS FOR ONE YEAR.
SECTION 9 NEGATIVE COVENANTS. As long as any Lender is committed to lend under
this agreement and until the Obligation has been fully paid and performed,
Borrower covenants and agrees with Administrative Agent and Lenders that,
without first obtaining Required Lenders' consent (which shall not be
unreasonably withheld) to the contrary the Persons designated in the following
sections of this SECTION 9 may not directly or indirectly do any of the
following or commit (other than a commitment that is not binding
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on any such Person until any prior written consent of Required Lenders is first
obtained) to do any of the following:
9.1 DEBT. No Company may have any Debt except the following (the
"PERMITTED DEBT"):
(a) OBLIGATION. The Obligation and any Guaranty under this
agreement.
(b) EXISTING DEBT. The Debt described on SCHEDULE 7.12 (other
than any such Debt that is described on that schedule as to be paid
with the proceeds of Borrowings), together with all renewals,
extensions, amendments, modifications, and refinancings of (but not
any principal increases to) any of that Debt.
(c) INTERCOMPANY. Debt of Borrower to TCTM or of any of
Borrower's or TCTM's Subsidiaries to Borrower or TCTM.
(d) HEDGING AGREEMENTS. Hedging Agreements.
9.2 PREPAYMENTS. No Company may prepay or redeem or cause to be
prepaid or redeemed any principal of, or any interest on, any of its Debt
except (a) any of its other Debt if no Event of Default or Potential Default
exists immediately before, or will occur as a result of (or otherwise will
exist immediately after), the prepayment or redemption and (b) the Obligation.
9.3 LIENS. No Company may (a) create, incur, or suffer or permit to be
created or incurred or to exist any Lien upon any of its assets except
Permitted Liens or (b) enter into or permit to exist any arrangement or
agreement that directly or indirectly prohibits any Company from creating or
incurring any Lien on any of its assets except (i) the Credit Documents, (ii)
the TE Products Credit Agreement and related loan documents, (iii) any lease
that places a Lien prohibition on only the property subject to that lease, and
(iv) arrangements and agreements that apply only to property subject to
Permitted Liens. The following are "PERMITTED LIENS":
(a) EXISTING LIENS. The existing Liens that are described on
SCHEDULE 7.13 and all renewals, extensions, amendments, and
modifications of any of them to the extent that the total- principal
amount each individually secures never exceeds the total-principal
amount secured by it on the date of this agreement.
(b) THIS TRANSACTION. Liens, if any, ever granted to
Administrative Agent in favor of Lenders to secure all of any part of
the Obligation.
(c) SETOFFS. Subject to any limitations imposed upon them in
the Credit Documents, rights of set off or recoupment and banker's
Liens.
(d) INSURANCE. Pledges or deposits made to secure payment of
workers' compensation, unemployment insurance, or other forms of
governmental insurance or benefits or to participate in any fund in
connection with workers' compensation, unemployment insurance,
pensions, or other social security programs.
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(e) BIDS AND BONDS. Good-faith pledges or deposits (i) for
10% or less of the amounts due under (and made to secure) any
Company's performance of bids, tenders, contracts (except for the
repayment of borrowed money), (ii) in respect of any operating lease,
that are for up to but not more than the greater of either 10% of the
total rental obligations for the term of the lease or 50% of the total
rental obligations payable during the first year of the lease, or
(iii) made to secure statutory obligations, surety or appeal bonds, or
indemnity, performance, or other similar bonds benefitting any Company
in the ordinary course of its business.
(f) PROPERTY RESTRICTIONS. Zoning and similar restrictions on
the use of, and easements, restrictions, covenants, title defects, and
similar encumbrances on, Real Property that do not materially impair
the use of the Real Property and that are not violated by existing or
proposed structures or land use.
(g) INCHOATE LIENS. If no Lien has been filed in any
jurisdiction or agreed to (i) claims and Liens for Taxes not yet due
and payable, (ii) mechanic's Liens and materialman's Liens for
services or materials and similar Liens incident to construction and
maintenance of real property, in each case for which payment is not
yet due and payable, (iii) landlord's Liens for rental not yet due and
payable, and (iv) Liens of warehousemen and carriers and similar Liens
securing obligations that are not yet due and payable.
(h) MISCELLANEOUS. Any of the following to the extent that
the validity or amount is being contested in good faith and by
appropriate and lawful proceedings diligently conducted, reserve or
other appropriate provision (if any) required by GAAP has been made,
levy and execution has not issued or continues to be stayed, and they
do not individually or collectively detract materially from the value
of the property of the Person in question or materially impair the use
of that property in the operation of its business: (i) Claims and
Liens for Taxes; (ii) claims and Liens upon, and defects of title to,
real or personal property, including any attachment of personal or
real property or other legal process before adjudication of a dispute
on the merits; (iii) claims and Liens of mechanics, materialmen,
warehousemen, carriers, landlords, or other like Liens; (iv) Liens
incident to construction and maintenance of real property; and (v)
adverse judgments, attachments, or orders on appeal for the payment of
money.
9.4 EMPLOYEE PLANS. Except as disclosed on SCHEDULE 7.11 or where not
a Material-Adverse Event, no Company may permit any of the events or
circumstances described in SECTION 7.11 to exist or occur.
9.5 TRANSACTIONS WITH AFFILIATES. No Company may enter into any
material transaction with any of its Affiliates except (a) those described on
SCHEDULE 7.15, (b) transactions between Borrower and a Guarantor, (c)
transactions permitted under SECTIONS 9.1 or 9.7, (d) transactions in the
ordinary course of business and upon fair and reasonable terms not materially
less favorable than it could obtain or could become entitled to in an
arm's-length transaction with a Person that was not its Affiliate, and (e)
compensation arrangements in the ordinary course of business with directors and
officers of the Companies.
9.6 COMPLIANCE WITH LEGAL REQUIREMENTS AND DOCUMENTS. No Company may
(a) violate the provisions of any Legal Requirements (including, without
limitation, OSHA and Environmental Laws) applicable to it or of any material
agreement to which it is a party if that violation alone, or when aggregated
with all other violations, would be a Material-Adverse Event, (b) violate in
any material respect any
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provision of its Constituent Documents, or (c) repeal, replace, or amend any
provision of its Constituent Documents if that action would be a
Material-Adverse Event.
9.7 INVESTMENTS. No Company may make any Investments except the
following (the "PERMITTED INVESTMENTS"):
(a) INVESTMENT POLICY. Investments specifically permitted by
Texas Eastern's short-term cash and long-term investment policies,
true and correct copies of which have been provided to Administrative
Agent as they are from time to time in effect.
(b) INTERCOMPANY. Investments by TCTM in any of its
Subsidiaries that are also Guarantors, or by those Subsidiaries in any
other of its Subsidiaries that are also Guarantors.
For purposes of this SECTION 9, the total amount outstanding of any Investment
by any Person in any other Person is to be determined net of repayments and
dividends to, and sales of securities of the second Person by, the first
Person.
9.8 DISTRIBUTIONS. No Guarantor or Company may:
(a) enter into or permit to exist any arrangement or
agreement (other than this agreement and the TE Products Credit
Agreement) that prohibits it from paying Distributions to its equity
holders; or
(b) declare, make, or pay any Distribution other than (i)
Distributions from any Subsidiary of TCTM to its parent corporation,
(ii) Distributions from TCTM to TEPPCO Partners at any time when no
Potential Default or Event of Default exists or would exist
immediately after that Distribution, and (iii) Distributions by TEPPCO
Partners that (A) will not violate its Constituent Documents and (B)
do not exceed "Available Cash" as defined in TEPPCO Partners'
Agreement of Limited Partnership, in each case, so long as no Event of
Default or Potential Default exists or would exist as a result of it.
9.9 DISPOSITION OF ASSETS. No Company may sell, assign, lease,
transfer, or otherwise dispose of any of its assets (including equity interests
in any other Company) other than (a) dispositions in the ordinary course of
business for a fair and adequate consideration, (b) dispositions of assets that
are obsolete or are no longer in use and are not significant to the
continuation of that Company's business, and (c) dispositions from TCTM or
Borrower to their respective Subsidiaries that are also Guarantors, or by those
Subsidiaries to any other of their Subsidiaries that are also Guarantors.
9.10 MERGERS, CONSOLIDATIONS, AND DISSOLUTIONS. No Guarantor or
Company may merge or consolidate with any other Person or dissolve except (a)
if no Event of Default or Potential Default exists or will exist as a result of
it, any merger or consolidation, involving one or more Guarantors or Companies
(so long as, if TEPPCO Partners is involved, it is the survivor, and if
Borrower is involved other than with TEPPCO Partners, it is the survivor), and
(b) dissolution of any Guarantor or Company (other than TEPPCO Partners) if
substantially all of its assets have been conveyed to any other Guarantor or
Company or disposed of as permitted in SECTION 9.9.
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9.11 AMENDMENT OF CONSTITUENT DOCUMENTS. No Guarantor or Company shall
materially amend or modify (or permit the material amendment or modification
of) its Constituent Documents.
9.12 ASSIGNMENT. No Guarantor or Company may assign or transfer any of
its Rights, duties, or obligations under any of the Credit Documents.
9.13 FISCAL YEAR AND ACCOUNTING METHODS. No Company may change its
fiscal year for accounting purposes or any material aspect of its method of
accounting except to conform any new Subsidiary's accounting methods to TCTM's
accounting methods.
9.14 NEW BUSINESSES. No Guarantor or Company may engage in any
business except the businesses in which it is presently engaged and any other
reasonably related business.
9.15 GOVERNMENT REGULATIONS. No Guarantor or Company may conduct its
business in a way that it becomes regulated under the Investment Company Act of
1940 or the Public Utility Holding Company Act of 1935.
9.16 STRICT COMPLIANCE. No Guarantor or Company may indirectly do
anything that it may not directly do under any covenant in any Credit Document.
SECTION 10 FINANCIAL COVENANTS. As long as any Lender is committed to lend
under this agreement and until the Obligation has been fully paid and
performed, Borrower covenants and agrees with Administrative Agent and Lenders
that, without first obtaining Required Lenders' consent to the contrary, the
following may not occur or exist as applicable to the Companies and as
determined as of the last day of each fiscal quarter of TCTM:
10.1 MINIMUM NET WORTH. The Companies' stockholders' equity may never
be less than the sum of (a) $88,773,000, plus (b) 25% of the Companies'
quarterly, cumulative Net Income (without deduction for losses) after December
31, 1998, plus (c) 100% of all equity contributions to TCTM after December 31,
1998.
10.2 MAXIMUM FUNDED DEBT TO EBITDA. The ratio of the Companies' Funded
Debt to the Companies' EBITDA may never exceed 2.0 to 1.0.
10.3 FIXED CHARGE COVERAGE RATIO. The ratio of (a) the Companies'
EBITDA to (b) the Companies' Interest Expense and expenditures for the
maintenance or repair of capital assets may never be less than 2.0 to 1.0.
SECTION 11 EVENTS OF DEFAULT. The term "EVENT OF DEFAULT" means the occurrence
of any one or more of the following:
11.1 PAYMENT OF OBLIGATION. Borrower's failure or refusal to pay (a)
principal of any Note on or before the date due or (b) any other part of the
Obligation (including fees due under the Credit Documents) on or before three
Business Days after the date due.
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11.2 COVENANTS. Any Guarantor's or Company's failure or refusal to
punctually and properly perform, observe, and comply with any covenant (other
than covenants to pay the Obligation) applicable to it:
(a) In SECTIONS 9 or 10; or
(b) In SECTION 8.1, and that failure or refusal continues for
ten days after the earlier of either any Guarantor or any Company
knows of it or any Guarantor or any Company is notified of it by
Administrative Agent or any Lender; or
(c) In any other provision of any Credit Document, and that
failure or refusal continues for 30 days after the earlier of either
any Guarantor or any Company knows of it or any Guarantor or any
Company is notified of it by Administrative Agent or any Lender.
11.3 DEBTOR RELIEF. Any Guarantor or Company (a) is not Solvent, (b)
fails to pay its Debts generally as they become due, (c) voluntarily seeks,
consents to, or acquiesces in the benefit of any Debtor Law, or (d) becomes a
party to or is made the subject of any proceeding (except as a creditor or
claimant) provided for by any Debtor Law (unless, if the proceeding is
involuntary, the applicable petition is dismissed within 60 days after its
filing).
11.4 JUDGMENTS AND ATTACHMENTS. Where the amounts in controversy or of
any judgments, as the case may be, exceed (from and after the Closing Date and
individually or collectively) $25,000,000 for TEPPCO Partners or $1,000,000 for
any other Guarantor or Company, such entity fails (a) to have discharged,
within 60 days after its commencement, any attachment, sequestration, or
similar proceeding against any of its assets or (b) to pay any money judgment
against it within ten days before the date on which any of its assets may be
lawfully sold to satisfy that judgment.
11.5 GOVERNMENT ACTION. Where it is a Material-Adverse Event (a) a
final non-appealable order is issued by any Governmental Authority (including
the United States Justice Department) seeking to cause any Guarantor or Company
to divest a significant portion of its assets under any antitrust, restraint of
trade, unfair competition, industry regulation, or similar Legal Requirements,
or (b) any Governmental Authority condemns, seizes, or otherwise appropriates,
or takes custody or control of all or any substantial portion of any
Guarantor's or Company's assets.
11.6 MISREPRESENTATION. Any representation or warranty made by any
Guarantor or Company in any Credit Document at any time proves to have been
materially incorrect when made.
11.7 CHANGE OF CONTROL. Any one or more of the following occurs or
exists: (a) TCTM ceases to be the managing member of Borrower; (b) TEPPCO
Partners ceases to own at least 98.9899% of the limited partner interests in
TCTM; or (c) Texas Eastern or any other subsidiary of Duke Energy Corporation
ceases to be the sole general partner of TEPPCO Partners or TCTM or both.
11.8 OTHER DEBT.
(a) TE PRODUCTS CREDIT AGREEMENT. The existence of an "Event
of Default" under the TE Products Credit Agreement.
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(b) OTHER. In respect of any other Debt owed by any Guarantor
or Company (other than the Obligation) individually or collectively of
at least $5,000,000 (a) any Guarantor or Company fails to make any
payment when due (inclusive of any grace, extension, forbearance, or
similar period), or (b) any default or other event or condition occurs
or exists beyond the applicable grace or cure period, the effect of
which is to cause or to permit any holder of that Debt to cause
(whether or not it elects to cause) any of that Debt to become due
before its stated maturity or regularly scheduled payment dates, or
(c) any of that Debt is declared to be due and payable or required to
be prepaid by any Guarantor or Company before its stated maturity.
11.9 VALIDITY AND ENFORCEABILITY. Once executed, this agreement, any
Note or Guaranty ceases to be in full force and effect in any material respect
or is declared to be null and void or its validity or enforceability is
contested in writing by any Guarantor or Company party to it or any Guarantor
or Company party to it denies in writing that it has any further liability or
obligations under it except in accordance with that document's express
provisions or as the appropriate parties under SECTION 14.8 below may otherwise
agree in writing.
SECTION 12 RIGHTS AND REMEDIES.
12.1 REMEDIES UPON EVENT OF DEFAULT.
(a) DEBTOR RELIEF. If an Event of Default exists under
SECTION 11.3, the commitment to extend credit under this agreement
automatically terminates, the entire unpaid balance of the Principal
Debt and an accrued and unpaid portion of the remaining Obligation
automatically becomes due and payable without any action of any kind
whatsoever.
(b) OTHER EVENTS OF DEFAULT. If any Event of Default exists,
subject to the terms of SECTION 13.5(B), Administrative Agent may
(with the consent of, and must, upon the request of, Required
Lenders), upon notice to Borrower, do any one or more of the
following: (i) If the maturity of the Obligation has not already been
accelerated under SECTION 12.1(A), declare the entire unpaid balance
of all or any part of the Principal Debt and an accrued and unpaid
portion of the remaining Obligation immediately due and payable,
whereupon it is due and payable; (ii) terminate the commitments of
Lenders to extend credit under this agreement; (iii) reduce any claim
to judgment; and (iv) exercise any and all other legal or equitable
Rights afforded by the Credit Documents, by applicable Legal
Requirements, or in equity.
(c) OFFSET. If an Event of Default exists, to the extent
lawful, upon notice to Borrower, each Lender may exercise the Rights
of offset and banker's lien against each and every account and other
property, or any interest therein, which Borrower may now or hereafter
have with, or which is now or hereafter in the possession of, that
Lender to the extent of the full amount of the Obligation then matured
and owed to that Lender.
12.2 COMPANY WAIVERS. To the extent lawful, Borrower waives all other
presentment and demand for payment, protest, notice of intention to accelerate,
notice of acceleration, and notice of protest and nonpayment, and agrees that
its liability with respect to all or any part of the Obligation is not affected
by any renewal or extension in the time of payment of all or any part of the
Obligation, by any indulgence, or by any release or change in any security for
the payment of all or any part of the Obligation.
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12.3 NOT IN CONTROL. Nothing in any Credit Documents gives or may be
deemed to give to Administrative Agent or any Lender the Right to exercise
control over any Company's Real Property, other assets, affairs, or management
or to preclude or interfere with any Company's compliance with any Legal
Requirement or require any act or omission by any Company that may be harmful
to Persons or property. Any "Material-Adverse Event" or other materiality or
substantiality qualifier of any representation, warranty, covenant, agreement,
or other provision of any Credit Document is included for credit documentation
purposes only and does not imply or be deemed to mean that Administrative Agent
or any Lender acquiesces in any non-compliance by any Company with any Legal
Requirement, document, or otherwise or does not expect the Companies to
promptly, diligently, and continuously carry out all appropriate removal,
remediation, compliance, closure, or other activities required or appropriate
in accordance with all Environmental Laws. Administrative Agent's and Lenders'
power is limited to the Rights provided in the Credit Documents. All of those
Rights exist solely (and may be exercised in manner calculated by
Administrative Agent or Lenders in their respective good faith business
judgment) to assure payment and performance of the Obligation.
12.4 COURSE OF DEALING. The acceptance by Administrative Agent or
Lenders of any partial payment on the Obligation is not a waiver of any Event
of Default then existing. No waiver by Administrative Agent, Required Lenders,
or Lenders of any Event of Default is a waiver of any other then-existing or
subsequent Event of Default. No delay or omission by Administrative Agent,
Required Lenders, or Lenders in exercising any Right under the Credit Documents
impairs that Right or is a waiver thereof or any acquiescence therein, nor will
any single or partial exercise of any Right preclude other or further exercise
thereof or the exercise of any other Right under the Credit Documents or
otherwise.
12.5 CUMULATIVE RIGHTS. All Rights available to Administrative Agent,
Required Lenders, and Lenders under the Credit Documents are cumulative of and
in addition to all other Rights granted to Administrative Agent, Required
Lenders, and Lenders at law or in equity, whether or not the Obligation is due
and payable and whether or not Administrative Agent, Required Lenders, or
Lenders have instituted any suit for collection, foreclosure, or other action
in connection with the Credit Documents.
12.6 APPLICATION OF PROCEEDS. Any and all proceeds ever received by
Administrative Agent or Lenders from the exercise of any Rights pertaining to
the Obligation shall be applied to the Obligation according to SECTION 3.
12.7 EXPENDITURES BY LENDERS. Any costs and reasonable expenses spent
or incurred by Administrative Agent or any Lender in the exercise of any Right
under any Credit Document is payable by Borrower to Administrative Agent within
ten Business Days after it has given demand and copies of supporting invoices
or statements (if any), becomes part of the Obligation, and bears interest at
the Default Rate from the date spent until the date repaid.
12.8 LIMITATION OF LIABILITY. No Administrative Agent or Lender shall
be liable to any Company for any amounts representing indirect, special, or
consequential damages suffered by any Company, except where such amounts are
based substantially on willful misconduct by that Administrative Agent or that
Lender, but then only to the extent any damages resulting from such wilful
misconduct are covered by that Administrative Agent's and that Lenders'
fidelity bond or other insurance.
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SECTION 13 ADMINISTRATIVE AGENT AND LENDERS.
13.1 ADMINISTRATIVE AGENT.
(a) APPOINTMENT. Each Lender appoints Administrative Agent
(including, without limitation, each successor Administrative Agent in
accordance with this SECTION 13) as its nominee and agent to act in
its name and on its behalf (and Administrative Agent and each such
successor accepts that appointment): (i) To act as its nominee and on
its behalf in and under all Credit Documents; (ii) to arrange the
means whereby its funds are to be made available to Borrower under the
Credit Documents; (iii) to take any action that it properly requests
under the Credit Documents (subject to the concurrence of other
Lenders as may be required under the Credit Documents); (iv) to
receive all documents and items to be furnished to it under the Credit
Documents; (v) to be the secured party, mortgagee, beneficiary,
recipient, and similar party in respect of collateral, if any, for the
benefit of Lenders; (vi) to promptly distribute to it all material
information, requests, documents, and items received from Borrower
under the Credit Documents; (vii) to promptly distribute to it its
ratable part of each payment or prepayment (whether voluntary, as
proceeds of collateral upon or after foreclosure, as proceeds of
insurance thereon, or otherwise) in accordance with the terms of the
Credit Documents; and (viii) to deliver to the appropriate Persons
requests, demands, approvals, and consents received from it. However,
Administrative Agent may not be required to take any action that
exposes it to personal liability or that is contrary to any Credit
Document or applicable Legal Requirement.
(b) SUCCESSOR. Administrative Agent may, subject to
Borrower's prior written consent that may not be unreasonably
withheld, assign all of its Rights and obligations as Administrative
Agent under the Credit Documents to any of its Affiliates, which
Affiliate shall then be the successor Administrative Agent under the
Credit Documents. Administrative Agent may also, upon 30 days prior
notice to Borrower, voluntarily resign. If the initial or any
successor Administrative Agent ever ceases to be a party to this
agreement or if the initial or any successor Administrative Agent ever
resigns then Required Lenders shall (which, if no Event of Default or
Potential Default exists, is subject to Borrower's approval that may
not be unreasonably withheld) appoint the successor Administrative
Agent from among Lenders (other than the resigning Administrative
Agent). If Required Lenders fail to appoint a successor Administrative
Agent within 30 days after the resigning Administrative Agent has
given notice of resignation, then the resigning Administrative Agent
may, on behalf of Lenders, upon 30 days prior notice to Borrower,
appoint a successor Administrative Agent, which must be a commercial
bank having a combined capital and surplus of at least $1,000,000,000
(as shown on its most recently published statement of condition). Upon
its acceptance of appointment as successor Administrative Agent, the
successor Administrative Agent succeeds to and becomes vested with all
of the Rights of the prior Administrative Agent, and the prior
Administrative Agent is discharged from its duties and obligations of
Administrative Agent under the Credit Documents, and each Lender shall
execute the documents that any Lender, the resigning Administrative
Agent, or the successor Administrative Agent reasonably request to
reflect the change. After any Administrative Agent's resignation as
Administrative Agent under the Credit Documents, the provisions of
this section inure to its benefit as to any actions taken or not taken
by it while it was Administrative Agent under the Credit Documents.
(c) RIGHTS AS LENDER. Administrative Agent, in its capacity
as a Lender, has the same Rights under the Credit Documents as any
other Lender and may exercise those Rights as if it were
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not acting as Administrative Agent. The term "Lender", unless the
context otherwise indicates, includes Administrative Agent.
Administrative Agent's resignation or removal does not impair or
otherwise affect any Rights that it has or may have in its capacity as
an individual Lender. Each Lender and Borrower agree that
Administrative Agent is not a fiduciary for Lenders or for Borrower
but is simply acting in the capacity described in this agreement to
alleviate administrative burdens for Borrower and Lenders, that
Administrative Agent has no duties or responsibilities to Lenders or
Borrower except those expressly set forth in the Credit Documents, and
that Administrative Agent in its capacity as a Lender has the same
Rights as any other Lender.
(d) OTHER ACTIVITIES. Administrative Agent or any Lender may
now or in the future be engaged in one or more loan, letter of credit,
leasing, or other financing transactions with Borrower, act as trustee
or depositary for Borrower, or otherwise be engaged in other
transactions with Borrower (collectively, the "OTHER ACTIVITIES") not
the subject of the Credit Documents. Without limiting the Rights of
Lenders specifically set forth in the Credit Documents, neither
Administrative Agent nor any Lender is responsible to account to the
other Lenders for those other activities, and no Lender shall have any
interest in any other Lender's activities, any present or future
guaranties by or for the account of Borrower that are not contemplated
by or included in the Credit Documents, any present or future offset
exercised by Administrative Agent or any Lender in respect of those
other activities, any present or future property taken as security for
any of those other activities, or any property now or hereafter in
Administrative Agent's or any other Lender's possession or control
that may be or become security for the obligations of Borrower arising
under the Credit Documents by reason of the general description of
indebtedness secured or of property contained in any other agreements,
documents, or instruments related to any of those other activities
(but, if any payments in respect of those guaranties or that property
or the proceeds thereof is applied by Administrative Agent or any
Lender to reduce the Obligation, then each Lender is entitled to share
ratably in the application as provided in the Credit Documents).
13.2 EXPENSES. Each Lender shall pay its Commitment Percentage of any
reasonable expenses (including court costs, reasonable attorneys' fees and
other costs of collection) incurred by Administrative Agent or in connection
with any of the Credit Documents if Administrative Agent is not reimbursed from
other sources within 30 days after incurrence. Each Lender is entitled to
receive its Commitment Percentage of any reimbursement that it makes to
Administrative Agent if Administrative Agent is subsequently reimbursed from
other sources.
13.3 PROPORTIONATE ABSORPTION OF LOSSES. Except as otherwise provided
in the Credit Documents, nothing in the Credit Documents gives any Lender any
advantage over any other Lender insofar as the Obligation is concerned or
relieves any Lender from ratably absorbing any losses sustained with respect to
the Obligation (except to the extent unilateral actions or inactions by any
Lender result in Borrower or any other obligor on the Obligation having any
credit, allowance, setoff, defense, or counterclaim solely with respect to all
or any part of that Lender's part of the Obligation).
13.4 DELEGATION OF DUTIES; RELIANCE. Lenders may perform any of their
duties or exercise any of their Rights under the Credit Documents by or through
Administrative Agent, and Lenders and Administrative Agent may perform any of
their duties or exercise any of their Rights under the Credit Documents by or
through their respective Representatives. Administrative Agent, Lenders, and
their respective Representatives (a) are entitled to rely upon (and shall be
protected in relying upon) any written or oral statement believed by it or them
to be genuine and correct and to have been signed or made by the
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proper Person and, with respect to legal matters, upon opinion of counsel
selected by Administrative Agent or that Lender (but nothing in this CLAUSE (A)
permits Administrative Agent to rely on (i) oral statements if a writing is
required by this agreement or (ii) any other writing if a specific writing is
required by this agreement), (b) are entitled to deem and treat each Lender as
the owner and holder of its portion of the Obligation for all purposes until,
written notice of the assignment or transfer is given to and received by
Administrative Agent (and any request, authorization, consent, or approval of
any Lender is conclusive and binding on each subsequent holder, assignee, or
transferee of or Participant in that Lender's portion of the Obligation until
that notice is given and received), (c) are not deemed to have notice of the
occurrence of an Event of Default unless a responsible officer of
Administrative Agent, who handles matters associated with the Credit Documents
and transactions thereunder, has actual knowledge or Administrative Agent has
been notified by a Lender or Borrower, and (d) are entitled to consult with
legal counsel (including counsel for Borrower), independent accountants, and
other experts selected by Administrative Agent and are not liable for any
action taken or not taken in good faith by it in accordance with the advice of
counsel, accountants, or experts.
13.5 LIMITATION OF ADMINISTRATIVE AGENT'S LIABILITY.
(a) EXCULPATION. Neither Administrative Agent nor any of its
Affiliates or Representatives will be liable to any Lender for any
action taken or omitted to be taken by it or them under the Credit
Documents in good faith and believed by it or them to be within the
discretion or power conferred upon it or them by the Credit Documents
or be responsible for the consequences of any error of judgment
(except for gross negligence or willful misconduct), and neither
Administrative Agent nor any of its Affiliates or Representatives has
a fiduciary relationship with any Lender by virtue of the Credit
Documents (but nothing in this agreement negates the obligation of
Administrative Agent to account for funds received by it for the
account of any Lender).
(b) INDEMNITY. Unless indemnified to its satisfaction against
loss, cost, liability, and expense, Administrative Agent may not be
compelled to do any act under the Credit Documents or to take any
action toward the execution or enforcement of the powers thereby
created or to prosecute or defend any suit in respect of the Credit
Documents. If Administrative Agent requests instructions from Lenders,
or Required Lenders, as the case may be, with respect to any act or
action in connection with any Credit Document, Administrative Agent is
entitled to refrain (without incurring any liability to any Person by
so refraining) from that act or action unless and until it has
received instructions. In no event, however, may Administrative Agent
or any of its Representatives be required to take any action that it
or they determine could incur for it or them criminal or onerous civil
liability. Without limiting the generality of the foregoing, no Lender
has any right of action against Administrative Agent as a result of
Administrative Agent's acting or refraining from acting under this
agreement in accordance with instructions of Required Lenders.
(c) RELIANCE. Administrative Agent is not responsible to any
Lender or any Participant for, and each Lender represents and warrants
that it has not relied upon Administrative Agent in respect of, (i)
the creditworthiness of Partners or any Company and the risks involved
to that Lender, (ii) the effectiveness, enforceability, genuineness,
validity, or the due execution of any Credit Document, (iii) any
representation, warranty, document, certificate, report, or statement
made therein or furnished thereunder or in connection therewith, (iv)
the adequacy of any collateral now or hereafter securing the
Obligation or the existence, priority, or perfection of any Lien now
or hereafter granted or purported to be granted on the collateral
under any Credit Document, or
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(v) observation of or compliance with any of the terms, covenants, or
conditions of any Credit Document on the part of Partners or any
Company. EACH LENDER AGREES TO INDEMNIFY ADMINISTRATIVE AGENT AND ITS
REPRESENTATIVES AND HOLD THEM HARMLESS FROM AND AGAINST (BUT LIMITED
TO SUCH LENDER'S COMMITMENT PERCENTAGE OF) ANY AND ALL LIABILITIES,
OBLIGATIONS, LOSSES, DAMAGES, PENALTIES, ACTIONS, JUDGMENTS, SUITS,
COSTS, REASONABLE EXPENSES, AND REASONABLE DISBURSEMENTS OF ANY KIND
OR NATURE WHATSOEVER THAT MAY BE IMPOSED ON, ASSERTED AGAINST, OR
INCURRED BY THEM IN ANY WAY RELATING TO OR ARISING OUT OF THE CREDIT
DOCUMENTS OR ANY ACTION TAKEN OR OMITTED BY THEM UNDER THE CREDIT
DOCUMENTS IF ADMINISTRATIVE AGENT AND ITS REPRESENTATIVES ARE NOT
REIMBURSED FOR SUCH AMOUNTS BY ANY COMPANY. ALTHOUGH ADMINISTRATIVE
AGENT AND ITS REPRESENTATIVES HAVE THE RIGHT TO BE INDEMNIFIED UNDER
THIS AGREEMENT BY LENDERS FOR ITS OR THEIR OWN ORDINARY NEGLIGENCE,
ADMINISTRATIVE AGENT AND ITS REPRESENTATIVES DO NOT HAVE THE RIGHT TO
BE INDEMNIFIED UNDER THIS AGREEMENT FOR ITS OR THEIR OWN GROSS
NEGLIGENCE OR WILLFUL MISCONDUCT.
13.6 EVENT OF DEFAULT. While an Event of Default exists, Lenders agree
to promptly confer in order that Required Lenders or Lenders, as the case may
be, may agree upon a course of action for the enforcement of the Rights of
Lenders. Administrative Agent is entitled to act or refrain from taking any
action (without incurring any liability to any Person for so acting or
refraining) unless and until it has received instructions from Required
Lenders. In actions with respect to any Company's property, Administrative
Agent is acting for the ratable benefit of each Lender.
13.7 LIMITATION OF LIABILITY. No Lender or any Participant will incur
any liability to any other Lender or Participant except for acts or omissions
in bad faith, and neither Administrative Agent nor any Lender or Participant
will incur any liability to any other Person for any act or omission of any
other Lender or any Participant.
13.8 OTHER AGENTS. Two Lenders are named on the cover page, in the
introductory paragraph of this agreement, and on the signature page of this
agreement as "Syndication Agent" or "Documentation Agent," respectively.
Neither of them, in those capacities, assumes any responsibility or obligation
under this agreement for syndication, documentation, servicing, enforcement, or
collection of any of the Obligation, nor any other duties, as agents for
Lenders.
13.9 RELATIONSHIP OF LENDERS. The Credit Documents do not create a
partnership or joint venture among Administrative Agent and Lenders or among
Lenders.
13.10 BENEFITS OF AGREEMENT. None of the provisions of this section
inure to the benefit of any Company or any other Person except Administrative
Agent and Lenders. Therefore, no Company or any other Person is responsible or
liable for, entitled to rely upon, or entitled to raise as a defense, in any
manner whatsoever, the failure of Administrative Agent or any Lender to comply
with these provisions.
SECTION 14 MISCELLANEOUS.
14.1 NONBUSINESS DAYS. Any payment or action that is due under any
Credit Document on a non-Business Day may be delayed until the next-succeeding
Business Day (but interest accrues on any payment until it is made). However,
if the payment concerns a LIBOR-Rate Borrowing and if the next-succeeding
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Business Day is in the next calendar month, then that payment must be made on
the next-preceding Business Day.
14.2 COMMUNICATIONS. Unless otherwise specified, any communication
from one party to another under any Credit Document must be in writing (which
may be by fax) to be effective and is deemed given (a) if by fax, when
transmitted to the appropriate fax number (which, without affecting the date
when deemed given, must be promptly confirmed by telephone), (b) if by mail, on
the third Business Day after it is enclosed in an envelope and properly
addressed, stamped, sealed, and deposited in the appropriate official postal
service, or (c) if by any other means, when actually delivered. Until changed
by notice under this agreement, the address, fax number, and telephone number
for Borrower and Administrative Agent are stated beside their respective
signatures to this agreement and for each Lender are stated beside its name on
SCHEDULE 2.
14.3 FORM AND NUMBER. The form, substance, and number of counterparts
of each writing to be furnished under this agreement must be satisfactory to
Administrative Agent and Borrower.
14.4 EXCEPTIONS. An exception to any Credit Document covenant or
agreement does not permit violation of any other Credit Document covenant or
agreement.
14.5 SURVIVAL. All Credit Document provisions survive all closings and
are not affected by any investigation by any party.
14.6 GOVERNING LAW. Unless otherwise specified, each Credit Document
must be construed, and its performance enforced, under the Laws of the State of
Texas and the United States of America.
14.7 INVALID PROVISIONS. If any provision of a Credit Document is
judicially determined to be unenforceable, then all other provisions of it
remain enforceable. If the provision determined to be unenforceable is a
material part of that Credit Document, then, to the extent lawful, it shall be
replaced by a judicially-construed provision that is enforceable but otherwise
as similar in substance and content to the original provision as the context of
it reasonably allows.
14.8 AMENDMENTS, SUPPLEMENTS, WAIVERS, CONSENTS, AND CONFLICTS.
(a) ALL LENDERS. Any amendment or supplement to, or waiver or
consent under, any Credit Document that purports to accomplish any of
the following must be by a writing executed by Borrower and executed
(or approved in writing, as the case may be) by all Lenders: (i)
Extends the due date for, decreases the amount or rate of calculation
of, or waives the late or non-payment of, any scheduled payment or
mandatory prepayment of principal or interest of any of the Obligation
or any fees payable ratably to Lenders under the Credit Documents,
except, in each case, any adjustments or reductions that are
contemplated by any Credit Document; (ii) changes the definition of
"Commitment," "Commitment Percentage," "Default Percentage," or
"Required Lenders," (iii) increases any part of any Lender's
Commitment; (iv) fully or partially releases or amends the Guaranty,
except, in each case, as expressly provided by any Credit Document or
as a result of a merger, consolidation, or dissolution expressly
permitted in the Credit Documents; (v) consents to any assignment by
Borrower under SECTION 14.10(a); or (vi) changes this CLAUSE (a) or
any other matter specifically requiring the consent of all Lenders
under any Credit Document.
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(b) ADMINISTRATIVE AGENT. Any amendment or supplement to, or
waiver or consent under, any Credit Document that purports to
accomplish any of the following must be by a writing executed by
Borrower and executed (or approved in writing, as the case may be) by
Administrative Agent: (i) Extends the due date for, decreases the
amount or rate of calculation of, or waives the late or non-payment
of, any fees payable to Administrative Agent under any Credit
Document, except, in each case, any adjustments or reductions that are
contemplated by any Credit Document; (ii) increases Administrative
Agent's obligations beyond its agreements under any Credit Document;
or (iii) changes this CLAUSE (b) or any other matter specifically
requiring the consent of Administrative Agent under any Credit
Document.
(c) REQUIRED LENDERS. Except as specified above (i) the
provisions of this agreement may be amended and supplemented, and
waivers and consents under it may be given, in writing executed by
Borrower and Required Lenders and otherwise supplemented only by
documents delivered in accordance with the express terms of this
agreement, and (ii) each other Credit Document may only be amended and
supplemented, and waivers and consents under it may be given, in a
writing executed by the parties to that Credit Document that is also
executed or approved by Required Lenders and otherwise supplemented
only by documents delivered in accordance with the express terms of
that other Credit Document.
(d) WAIVERS. No course of dealing or any failure or delay by
Administrative Agent, any Lender, or any of their respective
Representatives with respect to exercising any Right of Administrative
Agent or any Lender under any Credit Document operates as a waiver of
that Right. A waiver must be in writing and signed by the parties
otherwise required by this SECTION 14.8 to be effective and will be
effective only in the specific instance and for the specific purpose
for which it is given.
(e) CONFLICTS. Although this agreement and other Credit
Documents may contain additional and different terms and provisions,
any conflict or ambiguity between the express terms and provisions of
this agreement and express terms and provisions in any other Credit
Document is controlled by the express terms and provisions of this
agreement.
14.9 COUNTERPARTS. Any Credit Document may be executed in a number of
identical counterparts (including, at Administrative Agent's discretion,
counterparts or signature pages executed and transmitted by fax) with the same
effect as if all signatories had signed the same document. All counterparts
must be construed together to constitute one and the same instrument. Certain
parties to this agreement may execute multiple signature pages to this
agreement as well as one or more complete counterparts of it, and Borrower and
Administrative Agent are authorized to execute, where applicable, those
separate signature pages and insert them, along with signature pages of other
parties to this agreement, into one or more complete counterparts of this
agreement that contain signatures of all parties to it.
14.10 PARTIES.
(a) PARTIES AND BENEFICIARIES. Each Credit Document binds and
inures to the parties to it and each of their respective successors
and permitted assigns. Only those Persons may rely upon or raise any
defense about this agreement. No Company may assign or transfer any
Rights or obligations under any Credit Document without first
obtaining all Lenders' consent, and any purported assignment or
transfer without all Lenders' consent is void. No Lender may transfer,
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pledge, assign, sell any participation in, or otherwise encumber its
portion of the Obligation except as permitted by CLAUSES (c) or (d)
below, neither of which provisions permit any Lender to transfer,
pledge, assign, sell any participation in, or otherwise encumber any
of its portion of the Obligation for consideration that, directly or
indirectly, reflects a discount from face value (i.e., full principal
amount involved plus accrued and unpaid interest and fees related to
it) without first having offered that transfer, pledge, assignment,
participation, or encumbrance to all other Lenders ratably according
to their Commitment Percentages or Default Percentages, as the case
may be.
(b) RELATIONSHIP OF PARTIES. The relationship between each
Lender and each applicable Company is that of creditor/secured party
and obligor, respectively. Financial covenant and reporting provisions
in the Credit Documents are intended solely for the benefit of each
Lender to protect its interest as a creditor/secured party. Nothing in
the Credit Documents may be construed as (i) permitting or obligating
any Lender to act as a financial or business advisor or consultant to
any Company, (ii) permitting or obligating any Lender to control any
Company or conduct its operations, (iii) creating any fiduciary
obligation of any Lender to any Company, or (iv) creating any joint
venture, agency, or other relationship between the parties except as
expressly specified in the Credit Documents.
(c) PARTICIPATIONS. Any Lender may (subject to the provisions
of this section, in accordance with applicable Legal Requirement, in
the ordinary course of its business, at any time, and with notice to
Borrower) sell to one or more Persons (each a "PARTICIPANT")
participating interests in its portion of the Obligation so long as
the minimum amount of such participating interest is $5,000,000. The
selling Lender remains a "Lender" under the Credit Documents, the
Participant does not become a "Lender" under the Credit Documents, and
the selling Lender's obligations under the Credit Documents remain
unchanged. The selling Lender remains solely responsible for the
performance of its obligations and remains the holder of its share of
the Principal Debt for all purposes under the Credit Documents.
Borrower and Administrative Agent shall continue to deal solely and
directly with the selling Lender in connection with that Lender's
Rights and obligations under the Credit Documents, and each Lender
must retain the sole right and responsibility to enforce due
obligations of the Companies. Participants have no Rights under the
Credit Documents except as provided in the except clause of the last
sentence of this SECTION 14.10(c). Subject to the following, each
Lender may obtain (on behalf of its Participants) the benefits of
SECTION 3 with respect to all participations in its part of the
Obligation outstanding from time to time so long as Borrower is not
obligated to pay any amount in excess of the amount that would be due
to that Lender under SECTION 3 calculated as though no participations
have been made. No Lender may sell any participating interest under
which the Participant has any Rights to approve any amendment,
modification, or waiver of any Credit Document except as to matters in
SECTION 14.8(a)(i) and (ii).
(d) ASSIGNMENTS. Each Lender may make assignments to the
Federal Reserve Bank, provided that any related costs, fees, and
expenses incurred by such Lender in connection with such assignment or
the re-assignment back to it free of any interests of the Federal
Reserve Bank, shall be for the sole account of Lender. Each Lender may
also assign to one or more assignees (each an "ASSIGNEE") all or any
part of its Rights and obligations under the Credit Documents so long
as (i) the assignor Lender and Assignee execute and deliver to
Administrative Agent and Borrower for their consent and acceptance
(that may not be unreasonably withheld in any instance and is not
required by Borrower if an Event of Default exists) an assignment and
assumption agreement in
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substantially the form of EXHIBIT E (an "ASSIGNMENT") and pay to
Administrative Agent a processing fee of $3,500 (which payment
obligation is the sole liability, joint and several, of that Lender
and Assignee), (ii) the assignment must be for a minimum total
Commitment of $5,000,000, and, if the assigning Lender retains any
Commitment, it must be a minimum total Commitment of $5,000,000, and
(iii) the conditions for that assignment set forth in the applicable
Assignment are satisfied. The Effective Date in each Assignment must
(unless a shorter period is agreeable to Borrower and Administrative
Agent) be at least five Business Days after it is executed and
delivered by the assignor Lender and the Assignee to Administrative
Agent and Borrower for acceptance. Once that Assignment is accepted by
Administrative Agent and Borrower, and subject to all of the following
occurring, then, on and after the Effective Date stated in it (i) the
Assignee automatically becomes a party to this agreement and, to the
extent provided in that Assignment, has the Rights and obligations of
a Lender under the Credit Documents, (ii) in the case of an Assignment
covering all of the remaining portion of the assignor Lender's Rights
and obligations under the Credit Documents, the assignor Lender ceases
to be a party to the Credit Documents, (iii) Borrower shall execute
and deliver to the assignor Lender and the Assignee the appropriate
Notes in accordance with this agreement following the transfer, (iv)
upon delivery of the Notes under CLAUSE (iii) preceding, the assignor
Lender shall return to Borrower all Notes previously delivered to that
Lender under this agreement, and (v) SCHEDULE 2 is automatically
deemed to be amended to reflect the name, address, telecopy number,
and Commitment of the Assignee and the remaining Commitment (if any)
of the assignor Lender, and Administrative Agent shall prepare and
circulate to Borrower and Lenders an amended SCHEDULE 2 reflecting
those changes. Notwithstanding the foregoing, no Assignee may be
recognized as a party to the Credit Documents (and the assigning
Lender shall continue to be treated for all purposes as the party to
the Credit Documents) with respect to the Rights and obligations
assigned to that Assignee until the actions described in CLAUSES (iii)
and (iv) have occurred. The Obligation is registered on the books of
Borrower as to both principal and any stated interest, and transfers
of (as opposed to participations in) principal and interest of the
Obligation may only be made in accordance with this section.
14.11 VENUE, SERVICE OF PROCESS, AND JURY TRIAL. BORROWER IN EACH CASE
FOR ITSELF AND ITS SUCCESSORS AND ASSIGNS, IRREVOCABLY (A) SUBMITS TO THE
NONEXCLUSIVE JURISDICTION OF THE STATE AND FEDERAL COURTS IN TEXAS, (B) WAIVES,
TO THE FULLEST EXTENT LAWFUL, ANY OBJECTION THAT IT MAY NOW OR IN THE FUTURE
HAVE TO THE LAYING OF VENUE OF ANY LITIGATION ARISING OUT OF OR IN CONNECTION
WITH ANY CREDIT DOCUMENT AND THE OBLIGATION BROUGHT IN THE DISTRICT COURTS OF
DALLAS COUNTY, TEXAS, OR IN THE UNITED STATES DISTRICT COURT FOR THE NORTHERN
DISTRICT OF TEXAS, DALLAS DIVISION, (C) WAIVES ANY CLAIMS THAT ANY LITIGATION
BROUGHT IN ANY OF THE FOREGOING COURTS HAS BEEN BROUGHT IN AN INCONVENIENT
FORUM, (D) CONSENTS TO THE SERVICE OF PROCESS OUT OF ANY OF THOSE COURTS IN ANY
LITIGATION BY THE MAILING OF COPIES OF THAT PROCESS BY CERTIFIED MAIL, RETURN
RECEIPT REQUESTED, POSTAGE PREPAID, BY HAND DELIVERY, OR BY DELIVERY BY A
NATIONALLY-RECOGNIZED COURIER SERVICE, AND SERVICE SHALL BE DEEMED COMPLETE
UPON DELIVERY OF THE LEGAL PROCESS AT ITS ADDRESS FOR PURPOSES OF THIS
AGREEMENT, (E) AGREES THAT ANY LEGAL PROCEEDING AGAINST ANY PARTY TO ANY CREDIT
DOCUMENT ARISING OUT OF OR IN CONNECTION WITH THE CREDIT DOCUMENTS OR THE
OBLIGATION MAY BE BROUGHT IN ONE OF THE FOREGOING COURTS, AND (F) IRREVOCABLY
WAIVES TO THE FULLEST EXTENT PERMITTED BY LAW ITS RESPECTIVE RIGHTS TO A JURY
TRIAL OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING OUT OF ANY CREDIT
DOCUMENT. The scope of each of the foregoing waivers is intended to be all
encompassing of any and all disputes that may be filed in any court and that
relate to the subject matter of this transaction, including, without
limitation, contract claims, tort claims,
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breach of duty claims, and all other common law and statutory claims. BORROWER
ACKNOWLEDGES THAT THESE WAIVERS ARE A MATERIAL INDUCEMENT TO ADMINISTRATIVE
AGENT'S AND EACH LENDER'S AGREEMENT TO ENTER INTO A BUSINESS RELATIONSHIP, THAT
ADMINISTRATIVE AGENT AND EACH LENDER HAS ALREADY RELIED ON THESE WAIVERS IN
ENTERING INTO THIS AGREEMENT, AND THAT ADMINISTRATIVE AGENT AND EACH LENDER
WILL CONTINUE TO RELY ON EACH OF THESE WAIVERS IN RELATED FUTURE DEALINGS.
BORROWER FURTHER WARRANTS AND REPRESENTS THAT IT HAS REVIEWED THESE WAIVERS
WITH ITS LEGAL COUNSEL, AND THAT IT KNOWINGLY AND VOLUNTARILY AGREES TO EACH
WAIVER FOLLOWING CONSULTATION WITH LEGAL COUNSEL. The waivers in this section
are irrevocable, meaning that they may not be modified either orally or in
writing, and these waivers apply to any future renewals, extensions,
amendments, modifications, or replacements in respect of the applicable Credit
Document. In connection with any Litigation, this agreement may be filed as a
written consent to a trial by the court.
14.12 NON-RECOURSE TO TEXAS EASTERN. NEITHER TEXAS EASTERN NOR ANY
DIRECTOR, OFFICER, EMPLOYEE, STOCKHOLDER, OR AGENT OF TEXAS EASTERN SHALL HAVE
ANY LIABILITY FOR ANY OBLIGATIONS OF BORROWER OR GUARANTORS UNDER THIS
AGREEMENT OR ANY OTHER CREDIT DOCUMENT OR FOR ANY CLAIM BASED ON, IN RESPECT OF
OR BY REASON OF, SUCH OBLIGATIONS OR THEIR CREATION, INCLUDING ANY LIABILITY
BASED UPON, OR ARISING BY OPERATION OF LAW AS A RESULT OF, THE STATUS OR
CAPACITY OF TEXAS EASTERN AS THE "GENERAL PARTNER" OF TEPPCO PARTNERS. BY
EXECUTING THIS AGREEMENT, ADMINISTRATIVE AGENT AND EACH LENDER, EXPRESSLY
WAIVES AND RELEASES ALL SUCH LIABILITY. THIS WAIVER AND RELEASE SHALL BE A PART
OF THE CONSIDERATION FOR TEPPCO PARTNERS' EXECUTION AND DELIVERY OF ITS
GUARANTY.
14.13 CONFIDENTIALITY. Administrative Agent and each Lender agrees (on
behalf of itself and each of its Affiliates, and its and each of their
respective Representatives) to keep and maintain any non-public information
supplied to it by or on behalf of any Company which is identified as being
confidential and shall not use any such information for any purpose other than
in connection with the administration or enforcement of this transaction.
However, nothing herein shall limit the disclosure of any such information (a)
to the extent required by Legal Requirement, (b) to counsel of Administrative
Agent or any Lender in connection with the transactions provided for in this
agreement, (c) to bank examiners, auditors and accountants, or (d) any Assignee
or Participant (or prospective Assignee or Participant) so long as such
Assignee or Participant (or prospective Assignee or Participant) first enters
into a confidentiality agreement with Administrative Agent or such Lender.
14.14 ENTIRETY. THE CREDIT DOCUMENTS REPRESENT THE FINAL AGREEMENT
BETWEEN BORROWER, LENDERS, AND ADMINISTRATIVE AGENT WITH RESPECT TO THEIR
SUBJECT MATTER AND MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR,
CONTEMPORANEOUS, OR SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES. THERE ARE NO
UNWRITTEN ORAL AGREEMENTS BETWEEN THE PARTIES.
REMAINDER OF PAGE INTENTIONALLY BLANK.
SIGNATURE PAGE FOLLOWS.
CREDIT AGREEMENT
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EXECUTED as of the date first stated in this Credit Agreement.
TEPPCO Crude Oil, LLC TEPPCO CRUDE OIL, LLC, as Borrower
000 00xx Xxxxxx, Xxxxx 0000
Xxxxxx, XX 00000 By: TCTM, L.P., as Sole Member
Attn: Xxxxxxx X. Xxxxxx
Senior Vice President By: TEXAS EASTERN PRODUCTS
Phone: 000-000-0000 PIPELINE COMPANY, as
Fax: 000-000-0000 General Partner
By /s/ XXXXXXX X. XXXXXXX
---------------------------
Name: Xxxxxxx X. Xxxxxxx
----------------------
Title: Sr. V.P., CFO
and Treasurer
---------------------
SunTrust Bank, Atlanta SUNTRUST BANK, ATLANTA, as
000 Xxxxxxxxx Xxxxxx, X.X. Administrative Agent and a Lender
0xx Xxxxx
Xxxxxxx, XX 00000
Attn: Xxxxx Xxxxx By /s/ XXXX XXXXXXX
Assistant Vice President -------------------------------
Phone: 000-000-0000 Name: Xxxx Xxxxxxx
Fax: 000-000-0000 --------------------------
Title: Officer
-------------------------
By /s/ XXXXXXX X. XXXXXXXXX
-------------------------------
Name: Xxxxxxx X. Xxxxxxxxx
--------------------------
Title: Vice President
-------------------------
THE FIRST NATIONAL BANK OF FIRST UNION NATIONAL BANK, as
CHICAGO, as Syndication Agent and a Lender Documentation Agent and a Lender
By /s/ XXXXXX X. XXXXXXXXXXX By /s/ XXXXXXX XXXXXXXX
------------------------------- -------------------------------
Name: Xxxxxx X. Xxxxxxxxxxx Name: Xxxxxxx Xxxxxxxx
-------------------------- --------------------------
Title: Vice President Title: Vice President
------------------------- -------------------------
SIGNATURE PAGE TO TEPPCO CRUDE OIL LLC CREDIT AGREEMENT
