FIRST AMENDMENT TO CREDIT AGREEMENT
This FIRST AMENDMENT TO CREDIT AGREEMENT is made and entered into effective
as of the 1st day of September, 1997 (this "Amendment") among XXXXXX XXXXXX
OPERATING L.P. "B" (formerly known as Enron Transportation Services, L.P.), a
limited partnership formed under the laws of the State of Delaware (the
"Borrower"); each of the lenders that is or becomes a party to the Credit
Agreement (defined below) (individually, together with its successors and
assigns, a "Lender" and, collectively, the "Lenders"); and FIRST UNION NATIONAL
BANK (formerly known as First Union National Bank of North Carolina), a national
banking association (in its individual capacity, "First Union"), as agent for
the Lenders (in such capacity, together with its successors in such capacity,
the "Agent").
R E C I T A L S
A. The Borrower, the Agent and the Lenders previously entered into that
certain Credit Agreement dated as of February 14, 1997 (the "Credit Agreement"),
pursuant to which the Lenders agreed to make certain loans to and extensions of
credit on behalf of the Borrower upon the terms and conditions as provided
therein.
B. The Borrower and the Lenders now desire to make certain amendments and
supplements to the Credit Agreement.
NOW, THEREFORE, in consideration of the premises and other good and
valuable consideration and the mutual benefits, covenants and agreements herein
expressed, the parties hereto now agree 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 definitions of "Agreement", "Aggregate Revolving Credit Commitments"
and "Applicable Margin" in Section 1.02 of the Credit Agreement are hereby
amended to read as follows:
"Agreement" shall mean this Credit Agreement, as amended by the First
Amendment and as the same may be further amended or supplemented from time
to time.
"Aggregate Revolving Credit Commitments" at any time shall equal
$10,000,000, as the same may be reduced in accordance with Section 2.03
hereof.
"Applicable Margin" shall mean for Base Rate Loans or LIBOR Loans the
following rate per annum as applicable based on the Indebtedness Ratio in
effect from time to time:
------------------------------
Indebtedness LIBOR Base
Ratio Rate Rate
------------------------------
>4.00 2.000% 0.500%
------------------------------
>3.50 1.750% 0.250%
------------------------------
>3.00 1.500% 0.000%
------------------------------
>2.50 1.250% 0.000%
------------------------------
<
-2.50 1.000% 0.000%
------------------------------
3. Section 1.02 of the Credit Agreement is hereby supplemented, where
alphabetically appropriate, with the addition of the following definitions:
"First Amendment" shall mean that certain First Amendment to Credit
Agreement dated effective as of September 1, 1997 among the Borrower, the
Agent and the Lenders.
"Funded Debt Ratio" shall have the meaning assigned to that term in
Section 9.20.
"Indebtedness Ratio" shall mean the ratio of (i) the aggregate of all
Indebtedness and letters of credit (that are not included in Indebtedness)
outstanding on the date of calculation to (ii) EBITDA for the four fiscal
quarters ending on the last day of the preceding fiscal quarter of the
Borrower. For purposes of the calculation of the Indebtedness Ratio, EBITDA
will change four times a year based on the financial statements delivered
by the Borrower in accordance with Sections 8.01(a) and (b): 60 days
following the end of the first three fiscal quarters of the Borrower and
120 days following the end fourth fiscal quarter. The numerator of such
ratio will vary from time to time based on the outstanding Indebtedness and
letters of credit.
4. Section 2.03(a) of the Credit Agreement is hereby deleted, and the
following is substituted therefor:
"(a) The Aggregate Revolving Credit Commitments shall reduce
automatically $1,200,000 on each Quarterly Date commencing with March 31,
1998 and may be further reduced pursuant to Section 2.03(b) hereof."
5. Section 2.04(a) of the Credit Agreement is hereby deleted, and the
following is substituted therefor:
"(i) a commitment fee on the daily average unused amount of the
Aggregate Revolving Credit Commitment for the period from and including the
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Closing Date to but excluding the Revolving Credit Termination Date at the
following rate per annum based on the Indebtedness Ratio:
----------------------------
Indebtedness Commitment
Ratio Fee
----------------------------
>3.50 0.375%
----------------------------
<
-3.50 0.250%
----------------------------
Accrued commitment fees shall be payable quarterly in arrears on each
Quarterly Date and on the earlier of the date the Aggregate Revolving
Credit Commitments are terminated or the Revolving Credit Termination Date.
(ii) a letter of credit fee, computed (on the basis of a year of 360
days and actual days elapsed) for each day from the Closing Date at the
rate of 1.50% per annum of the LC Maximum Amount, payable quarterly in
arrears on each Quarterly Date."
6. Section 2.04(b)(i) of the Credit Agreement is hereby deleted, and the
following is substituted therefor:
"(i) 1/8% per annum of the LC Maximum Amount as a fronting fee, payable
quarterly in arrears on each Quarterly Date."
7. Section 6.01(l) of the Credit Agreement is hereby deleted in its
entirety.
8. Section 9.01 of the Credit Agreement is hereby amended by adding the
following new subsection (h):
"(h) the Borrower may become and remain liable with respect to
unsecured Indebtedness of the Borrower owing to the General Partner or any
Subsidiary or any other Affiliate of the General Partner created and
outstanding under a subordinated promissory note subordinated pursuant to a
Subordination Agreement substantially in the form of Exhibit A to the First
Amendment so long as the aggregate outstanding principal amount of such
subordinated Indebtedness does not at any time exceed $25,000,000."
9. Section 9.03 of the Credit Agreement is hereby amended by deleting the
existing subsection (g) and adding the following new subsections (g) and (h):
"(g) in addition to the investments permitted by Section 9.03(h), other
investments, loans or advances not to exceed $500,000 in the aggregate at
any time; and
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(h) loans or advances to the Guarantor; provided that immediately
before and after each loan or advance no Default or Event of Default exists
and is continuing."
10. Section 9.13 of the Credit Agreement is hereby amended by deleting the
second sentence and substituting the following sentence therefor:
"For purposes of this Section 9.13, "Debt Service Ratio" shall mean the
ratio of (i) EBITDA for the four fiscal quarters ending on such date to
(ii) cash payments made for scheduled principal payments, including without
limitation, any prepayments required as a result of the reduction of the
Aggregate Revolving Credit Commitment pursuant to Section 2.03(a) and
interest on Debt of the Borrower and its Consolidated Subsidiaries other
than as permitted under Section 9.01(f) for such four fiscal quarters of
the Borrower and its Consolidated Subsidiaries."
11. Section 9.16 of the Credit Agreement is hereby amended to read as
follows:
"Section 9.16 Transactions with Affiliates. Neither the Borrower nor
any Subsidiary will enter into any transaction, including, without
limitation, any purchase, sale, lease or exchange of Property or the
rendering of any service, with any Affiliate unless such transactions are
otherwise permitted under this Agreement, are in the ordinary course of its
business and are upon fair and reasonable terms to it."
12. Article IX of the Credit Agreement is hereby supplemented by adding the
following new Section 9.20:
"Section 9.20 Funded Debt Ratio. Commencing on the fiscal quarter
ending June 30, 1997, the Borrower will not permit its Funded Debt Ratio as
of the end of any fiscal quarter of the Borrower (calculated quarterly at
the end of each fiscal quarter) to be greater than 4.50 to 1.00. For
purposes of this Section 9.20, "Funded Debt Ratio" shall mean the ratio of
(i) the aggregate of all outstanding Debt for borrowed money (excluding
Debt outstanding on the Bonds and Debt permitted by Section 9.01(h)) and
letters of credit on such date to (ii) EBITDA for the four fiscal quarters
ending on such date."
13. Section 10.01(b) of the Credit Agreement is hereby amended by replacing
the name "Mont Belview Associates" with the name "Mont Belvieu Associates."
14. Annex 1 to the Credit Agreement is hereby deleted and replaced by Annex
1 attached to this Amendment.
15. This Amendment shall become binding when the Agent shall have received
counterparts of this Amendment executed by the Borrower and the Lenders and such
other documents as the Agent or its counsel may reasonably request.
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16. 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.
17. The Borrower hereby reaffirms that as of the date of this Amendment,
the representations and warranties made by the Borrower in Article VII of the
Credit Agreement as amended hereby are true and correct on the date hereof as
though made on and as of the date of this Amendment.
18. This Amendment shall be governed by, and construed in accordance with,
the laws of the State of Texas.
19. This Amendment may be executed in two or more counterparts, and it
shall not be necessary that the signatures of all parties hereto be contained on
any one counterpart hereof; each counterpart shall be deemed an original, but
all of which together shall constitute one and the same instrument. Delivery of
an executed signature page by facsimile transmission shall be as effective as
delivery of a manually executed counterpart hereof.
20. THE CREDIT AGREEMENT, THIS AMENDMENT, THE NOTES AND THE SECURITY
INSTRUMENTS REPRESENT THE FINAL AGREEMENT BETWEEN THE PARTIES AND MAY NOT BE
CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS OR SUBSEQUENT ORAL AGREEMENTS
OF THE PARTIES. THERE ARE NO UNWRITTEN OR ORAL AGREEMENTS BETWEEN THE PARTIES.
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IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be
duly executed effective as of the date first above written.
BORROWER: XXXXXX XXXXXX OPERATING L.P. "B"
(formerly known as Enron Transportation
Services, L.P.)
By: Kinder Xxxxxx X.X., Inc.,
its General Partner
By: /s/ Xxxxxxx X. Xxxxxx
Name: Xxxxxxx X. Xxxxxx
Title: Vice Chairman
AGENT AND LENDER: FIRST UNION NATIONAL BANK
By: /s/ Xxxxx Xxxxxxx
Name: Xxxxx Xxxxxxx
Title: Senior Vice President
