1
EXHIBIT 10.27
NINTH AMENDMENT TO CREDIT AGREEMENT
THIS NINTH AMENDMENT TO CREDIT AGREEMENT is made and entered into
effective as of this 31st day of December, 1996 (this "Amendment") among THE
GNI GROUP, INC., a Delaware corporation ("GNI"), DISPOSAL SYSTEMS, INC., a
Delaware corporation ("DSI"), RESOURCE TRANSPORTATION SERVICES, INC., a
Delaware corporation ("RTS"), GNI CHEMICALS CORPORATION, a Delaware corporation
("GNIC") and DISPOSAL SYSTEMS OF CORPUS CHRISTI, INC., a Delaware corporation
("Corpus") (GNI, RTS, GNIC, DSI and Corpus being, collectively, the "Loan
Parties"), the address for each for purposes hereof being 0000 Xxxxxxxxxxxx
Xxxx, X.X. Xxx 000, Xxxx Xxxx, Xxxxx 00000-0000 and NATIONSBANK OF TEXAS,
N.A., a national banking association (the "Lender"), formerly known as NCNB
TEXAS NATIONAL BANK, the address for purposes hereof being 700 Louisiana, X.X.
Xxx 0000, Xxxxxxx, Xxxxx 00000-0000.
W I T N E S S E T H
WHEREAS, GNI, DSI, RTS, GNIC and the Lender entered into that certain
Credit Agreement dated as of June 30, 1993 as amended by Amendment No. 1 dated
as of March 15, 1994, Second Amendment to Credit Agreement dated as of August
31, 1994, and Third Amendment to Credit Agreement dated as of December 31,
1994, and the Loan Parties and the Lender entered into that certain Fourth
Amendment to Credit Agreement dated as of March 3, 1995, that certain Fifth
Amendment to Credit Agreement dated as of March 31, 1995, that certain Sixth
Amendment to Credit Agreement dated as of November 3, 1995, that certain
Seventh Amendment to Credit Agreement dated as of September 23, 1996 and that
certain Eighth Amendment to Credit Agreement dated as of December 31, 1996
(collectively, the "Credit Agreement"), pursuant to which the Lender agreed to
make certain loans and issue letters of credit to the Loan Parties; and
WHEREAS, the Loan Parties have decided to amend the Credit Agreement;
and
NOW, THEREFORE, in consideration of the premises and other good and
valuable consideration and the mutual benefits, covenants and agreements herein
expressed, the Loan Parties and the Lender now agree to amend the Credit
Agreement as follows:
1. All capitalized terms used in this Amendment and not otherwise
defined herein shall have the meanings ascribed to such terms in the Credit
Agreement.
2. The definition of "Agreement", in Section 1.02 of the Credit
Agreement is hereby amended in its entirety to hereafter read as follows:
2
"Agreement" shall mean this Credit Agreement and all exhibits and
schedules hereto, as amended by Amendment No. 1 dated as of March 15,
1994, the Second Amendment to Credit Agreement dated as of August 31,
1994, the Third Amendment to Credit Agreement dated December 31, 1994,
the Fourth Amendment dated as of March 3, 1995, the Fifth Amendment
dated as of March31, 1995, the Sixth Amendment dated as of November 3,
1995, the Seventh Amendment dated as of September23, 1996, the Eighth
Amendment dated as of December 31, 1996 and the Ninth Amendment dated
as of December 31, 1996, as the same may from time to time be amended or
supplemented.
3. Section 1.02 of the Credit Agreement is further amended by adding
the following definition where appropriate:
"Ninth Amendment" shall mean the Ninth Amendment to Credit
Agreement dated as of December 31, 1996 among the Loan Parties and the
Lender.
4 Article 8 of the Credit Agreement is hereby amended by adding the
following Section 8.30:
"Section 8.30 Holders of the Subordinated Notes. (a) Include
in the Compliance Certificate delivered in connection with Section 8.06
the name and address for notice of each holder of the Subordinated
Notes, and (b) within five (5) Business Days following GNI's receipt of
notice of any new holder of the Subordinated Notes or any change of
address for notice for any holder of the Subordinated Notes deliver to
the Lender such information.
5. The outstanding principal balance of Note B exceeded the
Borrowing Base on the Borrowing Base Determination as of October 31, 1996, but
did not exceed the Borrowing Base on the subsequent Borrowing Base
Determination as of November 30, 1996. The Lender waives any Event of Default
resulting from the Loan Parties' failure to make a mandatory prepayment as
required by Section 4.07 on or around October 31, 1996. The foregoing waiver
shall not be deemed to be a waiver by the Lender of any other covenant,
condition or obligation on the part of the Loan Parties under the Credit
Agreement or any other Security Instrument except as set forth in the
immediately preceding sentence of this Amendment. In addition, the foregoing
waiver shall in no respect evidence any commitment by the Lender to grant any
future waivers of any covenant, condition or obligation on the part of the Loan
Parties under the Credit Agreement or any other Security Instrument. Any
further waivers must be specifically agreed to in writing in accordance with
Section 11.10 of the Credit Agreement.
6. This Amendment shall become binding on the Lender when, and only
when, the Lender shall have received each of the following in form and
substance satisfactory to the Lender or its counsel:
-2-
3
(a) counterparts of this Amendment executed by the Loan
Parties and the Lender; and
(b) such other agreements, documents, instruments, opinions,
certificates, waivers, consents, and evidence as the Lender may
reasonably request.
7. The parties hereto hereby acknowledge and agree that, except as
specifically supplemented and amended, changed or modified hereby, the Credit
Agreement shall remain in full force and effect in accordance with its terms.
Each Loan Party hereby confirms and ratifies its liability under its respective
Security Instrument in all respects to which it is a party. Each Security
Instrument shall remain enforceable against each Loan Party which is a party
thereto in accordance with its terms and shall secure all of the Obligations.
8. The Loan Parties hereby reaffirm that as of the date of this
Amendment, the representations and warranties contained in the Loan Documents
are true and correct on the date hereof as though made on and as of the date of
this Amendment.
9. The Loan Parties represent and warrant that (a) the execution,
delivery and performance of this Amendment are within the corporate power and
authority of the Loan Parties and have been duly authorized by appropriate
proceedings, (b) the Liens under the Security Instruments are valid and
subsisting and secure the Loan Parties' obligations under the Loan Documents as
amended hereby, and (c) this Amendment constitutes a legal, valid, and binding
obligation of the Loan Parties enforceable in accordance with its terms, except
as limited by applicable bankruptcy, insolvency, reorganization, moratorium or
similar laws affecting the rights of creditors generally and general principles
of equity.
10. This Amendment shall be construed in accordance with and governed
by the laws of the United States of America and the State of Texas.
11. THE CREDIT AGREEMENT, THIS AMENDMENT, THE WAIVER, THE NOTES, THE
GUARANTY AGREEMENTS, THE LETTER OF CREDIT AGREEMENTS, THE SECURITY INSTRUMENTS
AND THE OTHER WRITTEN DOCUMENTS REFERRED TO IN THE CREDIT AGREEMENT OR EXECUTED
IN CONNECTION WITH OR AS SECURITY FOR THE NOTES REPRESENT, COLLECTIVELY, THE
FINAL AGREEMENT AMONG THE PARTIES HERETO AND MAY NOT BE CONTRADICTED BY
EVIDENCE OF PRIOR, CONTEMPORANEOUS OR SUBSEQUENT ORAL AGREEMENTS OF THE
PARTIES. THERE ARE NO UNWRITTEN OR ORAL AGREEMENTS AMONG THE PARTIES.
-3-
4
IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be
duly executed effective as of the date first above written.
LOAN PARTIES: THE GNI GROUP, INC.
By:___________________________________
Name: Xxxxx X. Xxxxxx, III
Title: Chief Financial Officer
DISPOSAL SYSTEMS, INC.
By:___________________________________
Name: Xxxxx X. Xxxxxx, III
Title: Vice President
RESOURCE TRANSPORTATION SERVICES, INC.
By:___________________________________
Name: Xxxxx X. Xxxxxx, III
Title: Vice President
GNI CHEMICALS CORPORATION
By:__________________________________
Name: Xxxxx X. Xxxxxx, III
Title: Vice President
-4-
5
DISPOSAL SYSTEMS OF CORPUS CHRISTI, INC.
By:__________________________________
Name: Xxxxx X. Xxxxxx, III
Title: Vice President
LENDER: NATIONSBANK OF TEXAS, N.A.
By:___________________________________
Name: Xxxxxxx X. Xxxxxxx, Xx.
Title: Vice President
-5-
