FIRST AMENDMENT TO
FIFTH AMENDED AND RESTATED REVOLVING
CREDIT AND TERM LOAN AGREEMENT
THIS FIRST AMENDMENT TO FIFTH AMENDED AND RESTATED REVOLVING
CREDIT AND TERM LOAN AGREEMENT (this "First Amendment"), dated
effective as of the 2nd day of January, 1997, by and among GULF
ISLAND FABRICATION, INC., a Louisiana corporation ("Borrower"),
WHITNEY NATIONAL BANK, a national banking association
("Whitney"), FIRST NATIONAL BANK OF COMMERCE, a national banking
association, in its individual capacity ("First NBC") (each of
Whitney and First NBC being sometimes referred to individually as
a "Bank" and collectively as the "Banks"), and FIRST NATIONAL
BANK OF COMMERCE, a national banking association, in its capacity
as agent for the Banks as set forth hereinafter (the "Agent").
W I T N E S S E T H:
WHEREAS, Borrower and First NBC entered into that
certain Revolving Credit and Term Loan Agreement dated December 17,
1986 (the "Original Loan Agreement");
WHEREAS, Borrower and First NBC entered into that certain
First Amendment to Revolving Credit and Term Loan Agreement dated
as of November 3, 1987 (the "First Loan Agreement Amendment"),
whereby Borrower and First NBC amended certain terms and
conditions of the Original Loan Agreement;
WHEREAS, Borrower and First NBC entered into that certain
Second Amendment to Revolving Credit and Term Loan Agreement,
dated effective as of December 21, 1987 (the "Second Loan
Agreement Amendment"), whereby Borrower and First NBC further
amended certain terms and conditions of the Original Loan
Agreement;
WHEREAS, Borrower and First NBC entered into that certain
Third Amendment to Revolving Credit and Term Loan Agreement dated
effective as of September 13, 1988 (the "Third Loan Agreement
Amendment"), whereby Borrower and First NBC further amended
certain terms and conditions of the Original Loan Agreement(the
Original Loan Agreement as amended by the First Loan Agreement
Amendment, the Second Loan Agreement Amendment and the Third Loan
Agreement Amendment, the "Loan Agreement");
WHEREAS, Borrower and First NBC entered into that certain
First Amended and Restated Revolving Credit and Term Loan
Agreement dated July 27, 1989, whereby Borrower and First NBC
further amended certain terms and conditions of the Loan
Agreement and restated the Loan Agreement in its entirety (the
"First Amended and Restated Loan Agreement");
WHEREAS, Borrower and First NBC entered into that certain
Second Amended and Restated Revolving Credit and Term Loan
Agreement dated effective as of March 1, 1990, to set forth
further changes in their understanding concerning certain terms
and conditions of the loan made pursuant to the First Amended and
Restated Loan Agreement and to restate the same in its entirety
(the "Second Amended and Restated Loan Agreement");
WHEREAS, pursuant to the terms of that certain Partial
Assignment of Notes and Security Therefor, dated October 29, 1991
(as amended or modified from time to time, the "Assignment"),
First NBC assigned to Whitney an undivided one-half(1/2) interest
in and to the Second Amended and Restated Loan Agreement, all
notes executed by Borrower payable to the order of First NBC
pursuant to the Second Amended and Restated Loan Agreement and
all security for the repayment of such notes, as described in the
Second Amended and Restated Loan Agreement;
WHEREAS, as a result of the Assignment, each Bank acquired
an undivided one-half (1/2) interest in and to the Second Amended
and Restated Loan Agreement and all rights and obligations
described therein or emanating therefrom;
WHEREAS, Borrower, Banks and Agent entered into that certain
Third Amended and Restated Revolving Credit and Term Loan
Agreement, dated effective as of October 29, 1991 (the "Third
Amended and Restated Loan Agreement"), whereby Borrower, Banks
and Agent amended and restated the Second Amended and Restated
Loan Agreement in order to reflect more fully the agreement among
the parties regarding the continuation of the loans made pursuant
thereto;
WHEREAS, Borrower, Banks and Agent entered into that certain
First Amendment to Third Amended and Restated Revolving Credit
and Term Loan Agreement (the "Third Amended and Restated Loan
Agreement Amendment"), whereby Borrower, Banks and Agent amended
certain terms and conditions of the Third Amended and Restated
Loan Agreement;
WHEREAS, Borrower, Banks and Agent entered into that certain
Fourth Amended and Restated Revolving Credit Agreement, dated
effective as of February 25, 1993 (the "Fourth Amended and
Restated Credit Agreement"), whereby Borrower, Banks and Agent
amended and restated the Third Amended and Restated Loan
Agreement, as amended by the Third Amended and Restated Loan
Agreement Amendment, in order to reflect more fully the agreement
among the parties regarding the continuation of the loans made
pursuant thereto;
WHEREAS, Borrower, Banks and Agent entered into four subse-
quent amendments to the Fourth Amended and Restated Revolving
Credit Agreement, dated respectively effective as of February 25,
1993, April 20, 1994, June 26, 1995 and May 1, 1996
(collectively, the "Amendments to the Fourth Amended and Restated
Credit Agreement");
WHEREAS, Borrower, Banks and Agent entered into that certain
Fifth Amended and Restated Revolving Credit and Term Loan
Agreement, dated effective as of October 24, 1996 (the "Fifth
Amended and Restated Credit Agreement"), whereby Borrower, Banks
and Agent amended and restated the Fourth Amended and Restated
Loan Agreement, as previously amended by the Amendments to the
Fourth Amended and Restated Credit Agreement, and added a
$10,000,000 term loan facility;
WHEREAS, Borrower, Banks and Agent desire to amend the Fifth
Amended and Restated Credit Agreement to increase the term loan
facility by $5,000,000, to permit Borrower to acquire Dolphin
Services, Inc., Dolphin Steel Sales, Inc., and Dolphin Sales &
Rentals, Inc., and to extend the maturity date of the Term Credit
Facility under the Fifth Amended and Restated Credit Agreement;
NOW, THEREFORE, for and in consideration of the mutual cove-
nants, agreements and undertakings herein contained, Banks, Agent
and Borrower hereby agree as follows:
ARTICLE I
AMENDMENTS TO FIFTH AMENDED AND RESTATED CREDIT AGREEMENT
1. Section 1. Section 1 of the Fifth Amended and Restated
Credit Agreement is hereby amended by deleting the amount
"TWENTY-TWO MILLION AND NO/100 DOLLARS ($22,000,000.00)" from the
final sentence thereof and inserting in its place the amount
"TWENTY-SEVEN MILLION AND NO/100 DOLLARS ($27,000,000.00)".
2. Section 1.1. Section 1.1 of the Fifth Amended and
Restated Credit Agreement is hereby amended in its entirety to
state:
1.1 Term Credit Facility. Banks shall
make available to Borrower a non-revolving
line of credit in the maximum aggregate
principal amount of FIFTEEN MILLION AND
NO/100 DOLLARS ($15,000,000.00) (the "Non-
Revolving Line of Credit"), which Non-
Revolving Line of Credit may be drawn upon by
Borrower on any Business Day of Banks during
the period from the date hereof until and
including June 30, 1997, or such earlier date
as may be fixed by Borrower on at least one
(1) Business Day's telephonic notice to
Agent, to be confirmed in writing by
Borrower, in the form of actual fundings to
Borrower by Banks in such amounts as Borrower
may from time to time request (each such
funding being hereinafter referred to
individually as a "Non-Revolving Advance" and
collectively as the "Non-Revolving
Advances"), so long as the aggregate
principal amount of all outstanding Non-
Revolving Advances at any one time does not
exceed the Non-Revolving Commitment. On
July 1, 1997, all of Banks' obligations to
make Non-Revolving Advances on the Non-
Revolving Line of Credit shall cease, and
shall automatically, without the necessity of
any further act on the part of Banks, Agent
or Borrower, convert to a term loan in a
principal amount equal to the aggregate
amount of all Non-Revolving Advances made by
Banks to Borrower during the period from
October 24, 1996 until and including June 30,
1997. All Non-Revolving Advances repaid on
the Non-Revolving Line of Credit shall not
be reborrowed but shall reduce the Non-
Revolving Commitment on a dollar-for-dollar
basis. The credit facility described in this
Section 1.1 is hereinafter referred to as the
"Term Credit Facility".
3. Section 2.1. Section 2.1 of the Fifth Amended and
Restated Credit Agreement is hereby amended in its entirety to
state:
2.1 Term Notes. The Non-Revolving Advances
shall be evidenced by two (2) promissory notes of Bor-
rower payable to the order of First NBC and Whitney,
respectively, each in the original principal amount of
SEVEN MILLION FIVE HUNDRED THOUSAND AND NO/100 DOLLARS
($7,500,000.00) and in the forms set forth as Exhibits
"B" and "C" to this Agreement (each such note, together
with any and all renewals, modifications, extensions,
amendments, supplements and/or substitutions therefor,
being sometimes referred to herein individually as a
"Term Note" and collectively as the "Term Notes"), with
appropriate insertions, each of which shall be dated
January 2, 1997 and shall be payable in full on June
30, 2004. All Non-Revolving Advances made by Banks to
Borrower pursuant to this Agreement and all payments of
principal shall be recorded by Banks on the schedule
attached to each Term Note, but Banks' failure to
record or to record correctly such Non-Revolving
Advances shall in no way affect Borrower's obligation
to repay same. Each Term Note shall provide for
quarterly installments of principal commencing
September 30, 1997, each in an amount equal to one-
twenty-eighth (1/28th) of the aggregate amount of all
Non-Revolving Advances made by Banks to Borrower during
the period from October 24, 1996 through and including
June 30, 1997.
4. Section 3.1. The penultimate sentence of Section 3.1
of the Fifth Amended and Restated Credit Agreement is hereby
amended by replacing "December 31, 1996 and March 31, 1996" with
the phrase "December 31, 1996, March 31, 1997, and June 30,
1997".
5. Section 5.1. New Sections 5.1(c) and 5.1(d) are hereby
added to the Fifth Amended and Restated Credit Agreement to
state:
(c) As of January 2, 1997, Borrower has granted to
First NBC, as Agent for Banks, as security for the
Notes and other Obligations, a first priority security
interest in all capital stock of Dolphin Sales &
Rentals, Inc. ("Dolphin Sales"), Dolphin Steel Sales,
Inc. ("Dolphin Steel"), and Dolphin Services, Inc.
("Dolphin Services"), as evidenced by (i) that certain
Commercial Pledge and Security Agreement, dated
January 2, 1997, by Borrower, as pledgor, in favor of
First NBC, as Agent for Banks, as pledgee (the "Stock
Pledge") and (ii) that certain UCC-1 Financing
Statement by Borrower (the "Stock Pledge Financing
Statement"). Dolphin Sales, Dolphin Steel, and Dolphin
Services shall be referred to collectively as the
"Dolphin Companies", and each such company may be
referred to generically as a "Dolphin Company".
(d) As of January 2, 1997, Borrower has caused the
Dolphin Companies to guarantee the Notes and Borrower's
other Obligations to Banks and to grant mortgages on
their respective immovable properties (collectively,
the "Dolphin Real Estate") and a security interest in
their respective Equipment and Fixtures as security for
the aforesaid guaranties and as direct security for the
Notes and Borrower's other Obligations to Banks, as
evidenced by:
(i) That certain Commercial Guaranty by Dolphin
Sales, dated January 2, 1997, in favor of
First NBC, as Agent for Banks, which secures
the Notes and Borrower's other Obligations to
Banks (the "Dolphin Sales Guaranty");
(ii) That certain Commercial Guaranty by Dolphin
Steel, dated January 2, 1997, in favor of
First NBC, as Agent for Banks, which secures
the Notes and Borrower's other Obligations to
Banks (the "Dolphin Steel Guaranty");
(iii) That certain Commercial Guaranty by Dolphin
Services, dated January 2, 1997, in favor of
First NBC, as Agent for Banks, which secures
the Notes and Borrower's other Obligations to
Banks (the "Dolphin Services Guaranty");
(iv) That certain Collateral Mortgage Note by
Dolphin Sales, dated January 2, 1997, in the
principal sum of $3,000,000.00, bearing
interest at the rate of eighteen percent
(18%) per annum, from date until paid, and
payable to the order of Bearer (the "Dolphin
Sales Note");
(v) That certain Collateral Mortgage by Dolphin
Sales, dated January 2, 1997, in favor of
First NBC, as Agent for Banks, and any and
all future holders, which mortgage encumbers
Dolphin Sales' immovable property in
Terrebonne Parish, Louisiana more fully
described on Exhibit "L" to this Agreement
(the "Dolphin Sales Real Estate") and secures
the Dolphin Sales Note (the "Dolphin Sales
Mortgage");
(vi) That certain Pledge of Collateral Mortgage
Note, dated January 2, 1997, by Dolphin
Sales to First NBC, as Agent for Banks, with
respect to the Dolphin Sales Note, which
secures the Notes, Borrower's other
Obligations to Banks, and the Dolphin Sales
Guaranty (the "Dolphin Sales Pledge");
(vii) That certain Collateral Mortgage Note by
Dolphin Services, dated January 2, 1997, in
the principal sum of $3,000,000.00, bearing
interest at the rate of eighteen percent
(18%) per annum, from date until paid, and
payable to the order of Bearer (the "Dolphin
Services Note");
(viii) That certain Collateral Mortgage by Dolphin
Services, dated January 2, 1997, in favor of
First NBC, as Agent for Banks, and any and
all future holders, which mortgage encumbers
Dolphin Services' immovable property in
Terrebonne Parish, Louisiana more fully
described on Exhibit "M" to this Agreement
(the "Dolphin Services Real Estate") and
secures the Dolphin Services Note (the
"Dolphin Services Mortgage");
(ix) That certain Pledge of Collateral Mortgage
Note, dated January 2, 1997, by Dolphin
Services to First NBC, as Agent for Banks,
with respect to the Dolphin Services Note,
which secures the Notes, Borrower's other
Obligations to Banks, and the Dolphin
Services Guaranty (the "Dolphin Services
Pledge");
(x) That certain Commercial Security Agreement,
dated January 2, 1997, by Dolphin Sales, as
grantor, in favor of First NBC, as Agent for
Banks, creating a security interest in
Dolphin Sales' Equipment and Fixtures, as
security for the Notes, Borrower's other
Obligations to Banks, and the Dolphin Sales
Guaranty (the "Dolphin Sales Security
Agreement");
(xi) A UCC-1 Financing Statement executed by
Dolphin Sales in connection with the Dolphin
Sales Security Agreement;
(xii) That certain Commercial Security Agreement,
dated January 2, 1997, by Dolphin Steel, as
grantor, in favor of First NBC, as Agent for
Banks, creating a security interest in
Dolphin Steel's Equipment and Fixtures, as
security for the Notes, Borrower's other
Obligations to Banks, and the Dolphin Steel
Guaranty (the "Dolphin Steel Security
Agreement");
(xiii) A UCC-1 Financing Statement executed by
Dolphin Steel in connection with the Dolphin
Steel Security Agreement;
(xiv) That certain Commercial Security Agreement,
dated January 2, 1997, by Dolphin Services,
as grantor, in favor of First NBC, as Agent
for Banks, creating a security interest in
Dolphin Services' Equipment and Fixtures, as
security for the Notes, Borrower's other
Obligations to Banks, and the Dolphin
Services Guaranty (the "Dolphin Services
Security Agreement"); and
(xv) A UCC-1 Financing Statement executed by
Dolphin Services in connection with the
Dolphin Services Security Agreement.
6. Section 6. Section 6 of the Fifth Amended and Restated
Credit Agreement is hereby amended in its entirety to state:
Section 6.Representations and Warranties of Borrower.
Borrower represents and warrants to Banks and Agent
that:
6.1 Corporate Existence. Each of Borrower and its
Subsidiaries is a corporation duly organized, validly
existing and in good standing under the laws of the
State of Louisiana; and each of Borrower and its
Subsidiaries has all necessary corporate power and
authority to acquire, own and hold the property and all
other properties it purports to own and hold and to
carry on its business as now conducted.
6.2 Authorization; Validity. Each of Borrower and
its Subsidiaries is and/or has been duly authorized to
execute and deliver this Agreement and all other Loan
Documents to which such Borrower or Subsidiary is a
party and to perform its obligations under this
Agreement and all other Loan Documents to which such
Borrower or Subsidiary is a party. Borrower is duly
authorized and will continue to be duly authorized to
borrow money hereunder. Each of this Agreement and the
other Loan Documents to which Borrower or one of its
Subsidiaries is a party, as executed and delivered,
constitutes the legal, valid and binding obligation of
Borrower and/or such Subsidiary, enforceable in
accordance with the respective terms thereof.
6.3 No Conflicts. The execution and delivery of
the Loan Documents and the performance by each of
Borrower and its Subsidiaries of its obligations there-
under do not and will not conflict with any provision
of law or of the charter or by-laws of Borrower or such
Subsidiary or of any agreement binding upon Borrower or
such Subsidiary, as the case may be.
6.4 Financial Statements. Borrower's audited
financial statement as of December 31, 1995, a copy of
which has been furnished to Banks, has been prepared in
conformity with GAAP applied on a basis consistent with
that of the preceding fiscal year and period, presents
fairly the financial condition of Borrower as of such
date and the results of its operations for the periods
then ended. Borrower's unaudited financial statement
as of September 30, 1996, a copy of which has been
previously furnished to Banks, except for the absence
of footnotes normally associated with financial
statements prepared in accordance with GAAP, has been
prepared in conformity with GAAP and presents fairly
the financial condition of Borrower as of such date and
the results of its operations for the periods then
ended. Since December 31, 1995, there has been no
material adverse change in Borrower's financial
condition. Since December 31, 1996, there has been no
material adverse change in the financial condition of
any of Borrower's Subsidiaries.
6.5 Litigation. To the best of Borrower's
knowledge, after due inquiry, no litigation or
governmental proceedings are pending or threatened
against Borrower or any of its Subsidiaries, the
results of which might materially affect Borrower's or
such Subsidiary's financial condition or operations,
except those referred to in a schedule furnished
contemporaneously herewith and attached hereto as
Schedule 1. Other than any liability incident to such
litigation or proceedings or provided for or disclosed
in the financial statements referred to in Section 6.4,
Borrower does not have any material contingent
liabilities. No Subsidiary has any material contingent
liability other than those imposed by the Dolphin
Guaranties and the other Dolphin Security Instruments.
6.6 Liens. None of the assets of Borrower or any
of its Subsidiaries with a net book value of greater
than $25,000.00 is subject to any Lien, except for the
Liens created pursuant to the Collateral Documents and
Permitted Liens.
6.7 Subsidiaries. Borrower has no Subsidiaries
other than the Dolphin Companies, and no Dolphin
Company has any Subsidiaries.
6.8 Purpose. The proceeds of the Revolving Credit
Facility shall be used by Borrower only for the support
of working capital and for other general corporate
purposes. The proceeds of the Term Credit Facility
shall be used by Borrower only to make capital
improvements to the Real Property, to acquire
additional Equipment to be located on the Real Property
or on the Dolphin Real Estate, and to fund Borrower's
acquisition of the Dolphin Companies.
6.9 Use of Proceeds; Margin Securities. Borrower
is not engaged in the business of purchasing or selling
margin stock (as defined in Regulation U of the Board
of Governors of the Federal Reserve System) or
extending credit to others for the purpose of purchas-
ing or carrying margin stock and, without limiting the
generality of Section 6.8 hereof, no part of the
proceeds of any borrowing hereunder will be used to
purchase or carry any margin stock or for any other
purpose which would violate any of the margin
regulations of such Board of Governors.
6.10 Compliance with ERISA. Each of Borrower and
its Subsidiaries is in compliance with all statutes and
governmental rules and regulations applicable to it,
including, without limitation, the Employee Retirement
Income Security Act of 1974, as amended ("ERISA"). No
condition exists or event or transaction has occurred
in connection with any plan, as defined in Sections
3(3) and 3(37) of ERISA, maintained by Borrower or any
of its Subsidiaries (any such plan being hereinafter
called the "Plan"), which could result in Borrower's or
such Subsidiary's incurring any material liability,
fine or penalty. No Reportable Event (as defined in
ERISA) has occurred with respect to any such Plan.
Neither Borrower nor any of its Subsidiaries has
withdrawn from any such Plan or initiated steps to do
so and no steps have been taken to terminate any such
Plan.
6.11 Consents. No consent, approval or
authorization of, or registration or declaration with,
any federal or state governmental authority or other
regulatory agent for the validity of the execution and
delivery or for the performance by Borrower or any of
its Subsidiaries of the Loan Documents is required.
6.12 Tax Returns. Each of Borrower and its
Subsidiaries has filed all tax returns which are
required to be filed by any jurisdiction, and has paid
all taxes which have become due pursuant to said
returns or pursuant to any assessments.
6.13 Ownership of Borrower and Subsidiaries. No
less than forty-five percent (45%) of the issued and
outstanding stock of Borrower is owned by the Labordes
and no less than forty-five percent (45%) of the issued
and outstanding stock of Borrower is owned by the
Wilsons. Borrower owns one hundred percent (100%) of
the issued and outstanding stock of each Dolphin
Company.
6.14 Operation of Business. Each of Borrower and
its Subsidiaries possesses all licenses, permits,
franchises, patents, copyrights, trademarks and trade
names, or rights thereto, to conduct its business
substantially as now conducted and as presently
proposed to be conducted, and neither Borrower nor any
of its Subsidiaries is in violation of any valid
rights of others with respect to any of the foregoing.
6.15 Rights in Properties; Liens. Each of
Borrower and its Subsidiaries has good and indefeasible
title to its properties and assets, real and personal,
including the properties and assets reflected in the
financial statements described in Section 6.4 hereof,
and none of the properties, assets or leasehold
interests of Borrower or any Subsidiary is subject to
any Lien, except as permitted by Section 7.11 hereof.
6.16 Debt. Borrower has no Debt, except as
disclosed in the financial statements described in
Section 6.4 hereof and as otherwise permitted by this
Agreement. No Subsidiary of Borrower has any Debt
except as owed to Borrower or as otherwise permitted by
this Agreement.
6.17 Disclosure. No statement, information,
report, representation or warranty made by Borrower or
any of its Subsidiaries in this Agreement or in any of
the other Loan Documents or furnished by Borrower or
any of its Subsidiaries to Banks or Agent in connection
with the negotiation or preparation of this Agreement,
or any amendment hereto, contains any untrue statement
of a material fact or omits to state any material fact
necessary to make the statements herein or therein not
misleading. There is no fact known to Borrower or to
any of its Subsidiaries that has not been disclosed in
writing to Banks which has a material adverse effect,
or which might in the future have a material adverse
effect, on the business, assets, financial condition or
operations of Borrower, any of its Subsidiaries or on
the Collateral.
6.18 Registered Office; Principal Place of
Business; Location of Collateral. The principal place
of business, chief executive office and registered
office of Borrower and the place where Borrower keeps
its books and records and all Collateral is located on
the Real Property. The principal place of business,
chief executive office and registered office of each of
the Dolphin Companies and the place where each of the
Dolphin Companies keeps its books and records and all
collateral encumbered by the Dolphin Security
Agreements is located in Terrebonne Parish, Louisiana
(with the exception of certain collateral encumbered by
the Dolphin Security Agreements which is, from time to
time and in the ordinary course of the Dolphin
Companies' businesses, temporarily located at job sites
outside of Terrebonne Parish). Borrower has always
maintained its registered office in either Terrebonne
or East Baton Rouge Parish, Louisiana, and each of the
Dolphin Companies has always maintained its registered
office in Terrebonne Parish, Louisiana. Neither
Borrower nor any of its Subsidiaries does, or has ever
done, any business from any location other than as set
forth in this Section. No Person other than Borrower,
the Dolphin Companies, Agent and Banks has possession
of any of the Collateral.
6.19 Investment Company Act. Neither Borrower nor
any of its Subsidiaries is an "Investment Company"
within the meaning of the Investment Company Act of
1940, as amended.
6.20 Other Agreements. With the exception of
construction contracts entered into by Borrower or one
of its Subsidiaries in the ordinary course of
Borrower's or such Subsidiary's business, neither
Borrower nor any of its Subsidiaries is a party to any
indenture, loan or credit agreement, or to any lease or
other agreement or instrument, or subject to any
charter of corporate restriction which could have a
material adverse effect on the business, properties,
assets, operations or conditions, financial or
otherwise, of Borrower or such Subsidiary, or the
ability of Borrower or such Subsidiary to pay and
perform its obligations under the Loan Documents to
which it is a party. Neither Borrower nor any of its
Subsidiaries is in default in any respect in the
performance, observance or fulfillment of any of the
obligations, covenants or conditions contained in any
agreement or instrument material to its business to
which it is a party.
6.21 Compliance with Law. Each of Borrower and
its Subsidiaries is in compliance with all laws, rules,
regulations, orders and decrees which are applicable to
Borrower, its Subsidiaries or any of their respective
properties. Without limiting the generality of the
foregoing:
(a) Employment Matters. Each of Borrower and its
Subsidiaries is in full compliance with all
applicable laws, rules, regulations and
governmental standards regarding employment,
including, without limitation, the minimum
wage and overtime provisions of the Fair
Labor Standards Act, as amended (29 U.S.C.
Sections 201 - 219 ), and the regulations
promulgated thereunder.
(b) Environmental Matters.
(i) Each of Borrower and its Subsidiaries and
all of their respective properties, assets
and operations are in full compliance with
all Environmental Laws. Neither Borrower nor
any of its Subsidiaries is aware of or has
received notice of, any past, present or
future conditions, events, activities,
practices or incidents which may interfere
with or prevent the compliance or continued
compliance of Borrower or any of its
Subsidiaries with all Environmental Laws.
(ii) With the exception of the permits
specifically referred to in Section 7.8
hereof, each of which Borrower or its
Subsidiaries shall obtain and/or file, as the
case may be, in accordance with the terms of
Section 7.8, each of Borrower and its
Subsidiaries has obtained all permits, licen-
ses and authorizations and has filed all
plans which are required under Environmental
Laws in order to conduct its business and/or
own its properties and assets including
without limitation all Louisiana air emission
permits required under any Environmental Law
in order to conduct Borrower's or such
Subsidiary's business and/or own its assets
or properties.
(iii) Each of Borrower and its Subsidiaries has on
file an SPCC Plan as required under
applicable Environmental Laws in connection
with Borrower's storage of petroleum on the
Real Property or, if applicable, in
connection with a Subsidiary's storage of
petroleum on its immovable property.
(iv) No Hazardous Substances or Solid Wastes exist
on, about or within or have been used,
generated, stored, transported, disposed of
on, or released from any of the properties or
assets of Borrower or any of its Subsidiaries
except in compliance with Environmental Laws.
(v) There is no action, suit, proceeding,
investigation or inquiry before any court,
administrative agency or other governmental
authority pending or, to the knowledge of
Borrower or any of its Subsidiaries,
threatened against Borrower or any of its
Subsidiaries relating in any way to any
Environmental Law. Neither Borrower nor any
of its Subsidiaries has (A) been notified of
any liability for remedial action under any
Environmental Law, (B) received any request
for information by any governmental authority
with respect to the condition, use or
operation of any of its properties or assets,
or (C) received any notice from any
governmental authority or other Person with
respect to any violation of or liability
under any Environmental Law.
6.22 Corporate Name. The exact corporate name of
Borrower as it appears in its articles of incorporation
is as set forth in the introduction of this Agreement
and, with the exception of doing business under the
name GIFI, Inc., Borrower has never done any business
in any location under any other name. The exact
corporate name of each Dolphin Company as it appears in
its articles of incorporation is as set forth in
Section 5.1(c) of this Agreement, and no Dolphin
Company has ever done any business in any location
under any other name.
6.23 Collateral. The Collateral Documents create
in favor of Banks, and/or Agent for the benefit of
Banks, valid, enforceable and perfected Liens on the
properties described therein, which Liens secure the
payment and performance of the obligations of Borrower
and its Subsidiaries to Banks described in the
Collateral Documents, and which Liens are superior to
the rights of all third Persons, whether now existing
or hereafter arising.
6.24 Taxpayer I.D. Numbers. Borrower's Federal
Taxpayer Identification Number is 72-1147390. Dolphin
Services' Federal Taxpayer Identification Number is 72-
0890896; Dolphin Sales' Federal Taxpayer Identification
Number is 72-1092285; and Dolphin Steel's Federal
Taxpayer Identification Number is 72-1092757.
7. Section 7. Section 7 of the Fifth Amended and Restated
Credit Agreement is hereby amended in its entirety to state:
Section 7. Borrower's Covenants.
From the date of this Agreement and thereafter
until the expiration or termination of the Commitments,
and until the Notes and other liabilities of Borrower
hereunder are paid in full and all other obligations
and liabilities under the Loan Documents are performed
and paid in full, Borrower agrees that it will:
7.1 Financial Statements. Furnish to Agent:
(a) within one hundred twenty (120) days
after the end of each fiscal year, a
copy of Borrower's financial statements
(describing assets, liabilities, and
results of operations both for Borrower
individually and for Borrower and its
Subsidiaries on a consolidated basis),
audited by independent certified public
accountants of nationally recognized
standing selected by Borrower and
reasonably satisfactory to Banks,
prepared in conformity with GAAP;
(b) within forty-five (45) days after the
end of each month, a copy of Borrower's
unaudited financial statements
(describing assets, liabilities, and
results of operations both for Borrower
individually and for Borrower and its
Subsidiaries on a consolidated basis)
prepared in conformity with GAAP, except
for the absence of footnotes normally
associated with financial statements
prepared in accordance with GAAP;
(c) together with the financial statements
furnished by Borrower under preceding
clause (a), a certificate of the
president or chief financial officer of
Borrower to the effect that no Event of
Default with respect to Borrower, or
event which might mature into an Event
of Default with respect to Borrower, has
occurred and is continuing;
(d) forthwith upon the occurrence of an
Event of Default, a certificate of the
president or chief financial officer of
Borrower specifying the nature and the
period of existence thereof and what
action Borrower proposes to take with
respect thereto;
(e) written notice of any and all litigation
affecting Borrower or any of its
Subsidiaries, directly or indirectly;
provided, however, this requirement
shall not apply to litigation involving
Borrower or one of its Subsidiaries and
any other party if such litigation
involves, in the aggregate, less than
$100,000.00;
(f) prompt notice of any change in the
present officers, directors and/or
stockholders of Borrower or any of its
Subsidiaries; and
(g) from time to time, such other
information as Banks may reasonably
request.
7.2 Access. Permit access, and cause its
Subsidiaries to permit access, by Banks and Agent to
the books and records and other property of Borrower
and its Subsidiaries during normal business hours and
upon reasonable notice and permit, and cause its
Subsidiaries to permit, Banks to make copies of said
books and records.
7.3 Insurance. Maintain, and cause its
Subsidiaries to maintain, with financially sound and
reputable insurance companies workmen's compensation
insurance, liability insurance and insurance on
Borrower's and its Subsidiaries' property, assets and
business at least to such extent and against such
hazards and liabilities as is commonly maintained by
similar companies and, in addition to the foregoing
insurance, such insurance as may be required in the
Collateral Documents. In the case of property (whether
owned by Borrower or by one of its Subsidiaries) in
which Banks or Agent has a Lien, Borrower shall
provide, and shall cause its Subsidiaries to provide,
Agent with duplicate originals or certified copies of
such policies of insurance in such forms and amounts,
and containing such terms and conditions, as are
satisfactory to Banks, naming Banks as additional loss
payees and as additional insureds as their interests
may appear and providing that such policies will not be
canceled without thirty (30) days' prior written notice
to Banks.
7.4 Repair. Maintain, preserve and keep, and
cause its Subsidiaries to maintain, preserve, and keep,
Borrower's and such Subsidiaries' properties in good
repair, working order and condition, and make, and
cause its Subsidiaries to make, necessary and proper
repairs, renewals and replacements so that Borrower's
and its Subsidiaries' business carried on in connection
therewith may be properly conducted at all times.
7.5 Taxes. Pay or discharge, and cause its
Subsidiaries to pay and discharge, at or before
maturity or before becoming delinquent (a) all taxes,
levies, assessments and governmental charges imposed on
Borrower or any of its Subsidiaries or its income or
profits or any of its property, and (b) all lawful
claims for labor, materials and supplies which, if
unpaid, might become a Lien upon any of Borrower's
property or the property of any of its Subsidiaries;
provided, however, that neither Borrower nor any
Subsidiary shall be required to pay or discharge any
tax, levy, assessment or governmental charge which is
being contested in good faith by appropriate
proceedings diligently pursued.
7.6 Corporate Existence. Maintain its corporate
existence in good standing and cause its Subsidiaries
to maintain their respective corporate existences in
good standing.
7.7 Merger. Without the prior written consent of
Banks, not, and cause each of its Subsidiaries not to:
(a) be a party to any merger or
consolidation (other than a merger of
one or more of the Dolphin Companies
into another Dolphin Company or a merger
of one or more of the Dolphin Companies
into Borrower, in either event followed
by notice to Banks of the merger
delivered within ten (10) days after the
merger becomes effective);
(b) except in the normal course of its
business, sell, transfer, convey, or
lease all or any substantial part of
Borrower's or a Subsidiary's assets;
(c) sell or assign, except in the normal
course of Borrower's business or the
business of one of its Subsidiaries,
with or without recourse, any accounts
receivable or chattel paper.
7.8 Compliance. Comply, and cause its
Subsidiaries to comply, with all statutes, laws, ordi-
nances, orders, rules and regulations applicable to
Borrower or such Subsidiary, including, without
limitation, all Environmental Laws and ERISA; provided,
however, Borrower and its Subsidiaries shall be deemed
to be in compliance with this requirement for such time
as Borrower or one of its Subsidiaries may be
contesting, in good faith and with diligence by
appropriate proceedings, any alleged violation of any
statute, rule or regulation. Borrower shall not
permit, and shall cause each of its Subsidiaries not to
permit, any condition to exist in connection with any
Plan which might constitute grounds for the PBGC to
institute proceedings to have such Plan terminated or a
trustee appointed to administer such Plan, and Borrower
shall not engage in, or permit to exist or occur, and
shall cause its Subsidiaries not to engage in or permit
to occur or exist, any other condition, event or
transaction with respect to, any such Plan which could
result in Borrower or one of its Subsidiaries incurring
any material liability, fine or penalty.
Without limiting the generality of the foregoing,
Borrower shall comply, and shall cause each of its
Subsidiaries to comply, fully with and maintain in
effect any and all environmental permits and licenses
required under any Environmental Law in order to
conduct Borrower's or such Subsidiary's business. To
the extent such permits are required but have not been
obtained, or to the extent such existing permits must
be modified or renewed, Borrower shall make, and shall
cause its Subsidiaries to make, timely application for
and obtain all such permits, modifications or renewals
thereof, as the case may be, including, but not limited
to, necessary federal and/or state water discharge, air
emission and waste management permits.
As often as Banks or Agent may require, Borrower
shall submit to Agent written progress reports
addressing the status of environmental permits and
plans required of Borrower or any of its Subsidiaries,
including pending permit applications. All permits
required hereunder shall be obtained and/or filed, as
the case may be, within six (6) months from the
effective date hereof.
Anything contained herein to the contrary
notwithstanding, Borrower shall not use, or permit any
of its Subsidiaries to use, any of the properties of
Borrower or of one of Borrower's Subsidiaries or allow
such properties to be used for the storage, treatment
or disposal of Solid Waste or Hazardous Substances
except in the ordinary course of Borrower's or such
Subsidiary's business and in compliance with the terms
or any applicable Environmental Law or permit.
7.9 Use of Proceeds. Not use or permit any
proceeds of the Loans to be used, either directly or
indirectly, for the purpose, whether immediate,
incidental or ultimate, 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 from time to time, and furnish to Banks, upon
either of their requests, a statement in conformity
with the requirements of Federal Reserve Form U-1
referred to in Regulation U of the Board of Governors
of the Federal Reserve System.
7.10 Financial Covenants. Maintain, on a
consolidated basis with all of its Subsidiaries,
(a) a ratio of current assets to current
liabilities, as determined in accordance
with GAAP, in excess of 1.33 to 1;
(b) a minimum Net Worth of NINETEEN MILLION
AND NO/100 DOLLARS ($19,000,000.00) for
the period commencing September 30, 1996
and ending December 31, 1997; a minimum
Net Worth of TWENTY-ONE MILLION AND
NO/100 DOLLARS ($21,000,000.00) for the
period January 1, 1998 through
December 31, 1998, and a minimum Net
Worth of TWENTY-THREE MILLION AND NO/100
DOLLARS ($23,000,000.00) from and
including January 1, 1999 and
thereafter;
(c) a ratio of Debt to Net Worth no greater
than 1.1 to 1; and
(d) a ratio of Cash Flow to Debt Service of
at least 1.5 to 1, such ratio to be
determined as of the end of each fiscal
quarter by giving effect to such fiscal
quarter and the three (3) immediately
preceding fiscal quarters; provided that
there shall be no Event of Default under
this Section 7.10(d) unless Borrower
fails to meet the ratio described in
this Section 7.10(d) for three (3)
successive fiscal quarters.
7.11 Liens. Not create, incur, or suffer to
exist, and not permit any of Borrower's Subsidiaries to
create, incur or suffer to exist, any Lien on any of
Borrower's property or on the property of Borrower's
Subsidiaries except ((a) through (g) of this Section
being referred to collectively as the "Permitted
Liens"):
(a) those for taxes, assessments or
governmental charges or levies if the
same shall not at the time be delinquent
or thereafter can be paid without
penalty, or are being contested in good
faith and by appropriate proceedings;
(b) those imposed by law, such as carriers',
warehousemen's and mechanics' liens and
other similar liens arising in the
ordinary course of business which secure
payment of obligations not more than
sixty (60) days past due;
(c) those arising out of pledges or deposits
under workmen's compensation laws,
unemployment insurance, old age
pensions, or other social security or
retirement benefits, or similar
legislation;
(d) utility easements, building restrictions
and such other encumbrances or charges
against real property as are of a nature
generally existing with respect to
properties of a similar character and
which do not in any material way affect
the marketability of the same or
interfere with the use thereof in the
business of Borrower or of any of
Borrower's Subsidiaries;
(e) lessors' interests under financing
leases;
(f) liens on assets of Borrower and its
Subsidiaries not covered by the Loan
Documents which liens secure obligations
of Borrower or its Subsidiaries in the
ordinary course of business which in the
aggregate for all such obligations of
Borrower and its Subsidiaries do not
exceed $250,000.00; and
(g) the Liens created pursuant to the Loan
Documents.
7.12 Debt. Not create or permit to exist, and not
allow any of Borrower's Subsidiaries to create or
permit to exist, any Debt without the prior written
consent of Banks, if, as a result thereof, exclusive of
the indebtedness contemplated by this Agreement, the
aggregate amount of Debt of Borrower and its
Subsidiaries would exceed the sum of $250,000.00;
provided, however, that any Subsidiary may incur Debt
owed to Borrower and such Debt owed to Borrower shall
not be included in the $250,000.00 limit.
7.13 Redemptions, etc. Not, without the prior
written approval of Banks: (1) redeem, purchase or
acquire, directly or indirectly, any of Borrower's
stock; (2) authorize or issue additional stock in
Borrower of any class; (3) authorize any new class of
stock in Borrower; (4) authorize any currently existing
or new classes of stock in Borrower to become voting
stock; or (5) sell or transfer any treasury shares of
stock in Borrower. Provided, however, subparts (2)
through (5) of this Section 7.13 shall not apply except
to the extent that as a result thereof either (a) the
Labordes would fail to retain at least forty-five
percent (45%) of the issued and outstanding stock of
Borrower, or (b) the Wilsons would fail to retain at
least forty-five percent (45%) of the issued and
outstanding stock of Borrower. For purposes of this
Section 7.13, the Labordes and the Wilsons shall be
deemed owners of the issued and outstanding stock of
Borrower with respect to any issued and outstanding
stock that is owned either by the Labordes or the
Wilsons, any descendant of the Labordes or the Wilsons,
any trust for the exclusive benefit of the Labordes or
the Wilsons or any descendant of the Labordes or the
Wilsons, or the respective estates of the Labordes or
the Wilsons or any descendant of the Labordes or the
Wilsons if said stock will ultimately pass from the
respective estates of the Labordes or the Wilsons to a
descendant or a trust for the exclusive benefit of a
descendant of the Labordes or the Wilsons.
7.14 Capital Expenditures. Not make capital
expenditures, directly or through a Subsidiary, which
would exceed $9,000,000.00 in calendar year 1996;
$8,000,000.00 in calendar year 1997 (in addition to and
excluding the purchase price paid by Borrower for the
Dolphin Companies); or $2,000,000.00 per calendar year
thereafter.
7.15 Dividends. Not declare or pay any dividends
or make any other distribution on account of, or
purchase, acquire, redeem or retire any capital stock
of, Borrower, whether now or hereafter outstanding,
provided that, so long as there is no Event of Default
hereunder and Borrower continues as an S Corporation,
Borrower shall be permitted to pay the following cash
dividends on a cumulative basis, to-wit:
(a) commencing with Borrower's first fiscal
quarter 1996 and with respect to each
fiscal quarter thereafter, regular
dividends not to exceed 40% of
Borrower's pretax income earned in the
fiscal quarter immediately prior to the
fiscal quarter in question, as
determined in accordance with GAAP; and
(b) commencing annually in 1996, special
dividends not to exceed 65% of
Borrower's pretax income earned in the
fiscal year of Borrower immediately
prior to the fiscal year in question, as
determined in accordance with GAAP and
as provided in the audited financial
statements furnished to Agent pursuant
to Section 7.1(a) hereof, less the sum
of dividends paid in the 2nd, 3rd, and
4th fiscal quarters of such prior fiscal
year and dividends paid in the 1st
fiscal quarter of the fiscal year in
question.
7.16 Shareholder or Employee Loans. Not make, and
not permit any Subsidiary to make, advances or loans to
employees of Borrower or any Subsidiary or shareholders
of Borrower which exceed the aggregate amount of
$100,000.00.
7.17 Change in Business. Carry on and conduct,
and cause its Subsidiaries to carry on and conduct, the
business of Borrower and each of its Subsidiaries in
substantially the same manner and in substantially the
same fields of enterprise as such businesses are
presently conducted; provided, however, that the
foregoing shall not prevent Borrower or one of its
Subsidiaries from engaging in new and additional
activities as long as said activities are in
substantially the same fields of enterprise as are
currently being engaged in by Borrower and the Dolphin
Companies.
7.18 Accounts Receivable. Provide, and cause
Dolphin Services to provide, Banks with aging reports
of Borrower's and Dolphin Services' accounts receivable
on a monthly basis.
7.19 Compliance with Agreements. Comply with, and
cause each of its Subsidiaries to comply with, all
indentures, mortgages, deeds of trust and other
agreements binding on Borrower or any Subsidiary or
affecting its properties or business.
7.20 Further Assurances. Execute and deliver, and
cause its Subsidiaries to execute and deliver, such
further documentation as may be requested by Banks or
Agent to carry out the provisions and purposes of this
Agreement and the other Loan Documents and to preserve
and perfect the Liens of Banks or Agent for the benefit
of Banks, as the case may be, in the Collateral.
7.21 Disposition of Assets. Not sell, lease,
assign, transfer or otherwise dispose of, and shall
cause each of its Subsidiaries not to sell, lease,
assign, transfer or otherwise dispose of, any of its
assets, except dispositions of inventory and equipment
in the ordinary course of business and as otherwise
provided in this Agreement.
7.22 Change Tax I.D. Number. Not change, and
cause its Subsidiaries not to change, any of the
Federal Taxpayer Identification Numbers set forth in
Section 6.24 hereof without giving Agent at least sixty
(60) days' prior written notice.
7.23 Indemnity. Indemnify, defend and hold Agent
and Banks and their respective directors, officers,
agents, attorneys and employees harmless from and
against all claims, demands, causes of action,
liabilities, losses, costs and expenses (including,
without limitation, costs of suit, reasonable legal
fees and fees of expert witnesses) arising from or in
connection with (a) the presence in, on or under any
property of Borrower or of any Subsidiary of Borrower
(including, without limitation, the Real Property, the
GIFI Property, and the Dolphin Real Estate) of any
Hazardous Substance or Solid Waste, or any releases or
discharges (as the terms "release" and "discharge" are
defined under any applicable Environmental Law) of any
Hazardous Substance or Solid Waste on, under or from
such property, (b) any activity carried on or
undertaken on or off such property of Borrower or of
any of its Subsidiaries, whether prior to or during the
term of this Agreement, and whether by Borrower, any of
its Subsidiaries or any predecessor in title to
Borrower's or such Subsidiary's property or any
officers, employees, agents, contractors or
subcontractors of Borrower, any Subsidiary of Borrower
or any predecessor in title to the property of Borrower
or such Subsidiary, or any third persons at any time
occupying or present on such property, in connection
with the handling, use, generation, manufacture,
treatment, removal, storage, decontamination, clean-up,
transportation or disposal of any Hazardous Substance
or Solid Waste at any time located or present on or
under any of the aforedescribed property, or (c) any
breach of any representation, warranty or covenant
under the terms of this Agreement. The foregoing
indemnity shall further apply to any residual conta-
mination on or under any or all of the aforedescribed
property, or affecting any natural resources, and to
any contamination of any property or natural resources
arising in connection with the use, handling, storage,
transportation or disposal of any Hazardous Substance
or Solid Waste, and irrespective of whether any of such
activities were or will be undertaken in accordance
with applicable laws, regulations, codes and
ordinances. The indemnity described in this Section
shall survive the termination of this Agreement for any
reason whatsoever.
7.24 GIFI Property and Dolphin Real Estate. Not
create a Lien on the GIFI Property, or permit any
Subsidiary to create a Lien on the Dolphin Real Estate,
in favor of, or otherwise convey, or permit a
Subsidiary to convey, the GIFI Property or the Dolphin
Real Estate to any Person without the prior written
consent of Banks.
8. Section 10.4. Section 10.4 of the Fifth Amended and
Restated Credit Agreement is hereby amended in its entirety to
state:
10.4 Insolvency. Borrower or any Subsidiary of
Borrower becomes insolvent or admits in writing its
inability to pay its debts as they mature or applies
for, consents to, or acquiesces in the appointment of a
trustee or receiver for Borrower, such Subsidiary or
any property of Borrower or of such Subsidiary; or, in
the absence of such application, consent or
acquiescence, a trustee or receiver is appointed for
Borrower, for any Subsidiary of Borrower or for a
substantial part of any property of either Borrower or
of any of its Subsidiaries and is not discharged within
thirty (30) days; or any bankruptcy, reorganization,
debt arrangement, or other proceeding under any
bankruptcy or insolvency law, or any dissolution or
liquidation proceeding is instituted by or against
Borrower or any of Borrower's Subsidiaries, and if
instituted against Borrower or one of Borrower's
Subsidiaries, it is consented to or acquiesced in by
Borrower or such Subsidiary, or remains for thirty (30)
days undismissed; or any warrant of attachment is
issued against any substantial portion of the property
of Borrower or of any Subsidiary of Borrower which is
not released within thirty (30) days of service;
9. Section 10.5. Section 10.5 of the Fifth Amended and
Restated Credit Agreement is hereby amended to insert the phrase
"....or by any Subsidiary of Borrower...." immediately following
the word "Borrower" in the second line thereof.
10. Section 10.9. A new section 10.9 is hereby added to
the Fifth Amended and Restated Credit Agreement to state:
10.9 Subsidiary Default. Any Subsidiary of
Borrower defaults on the payment of any amount due
Banks under any Loan Document to which such Subsidiary
is a party, which default shall continue for a period
of five (5) days following written notice thereof to
Borrower from Banks or Agent; any representation or
warranty made by a Subsidiary of Borrower under any
Loan Document is untrue in any material respect as of
the date made, or any schedule, statement, report,
notice or writing furnished by a Subsidiary of Borrower
to Banks is untrue in any material respect on the date
as of which the facts set forth are stated or
certified, which default shall continue for a period of
thirty (30) days after written notice thereof to
Borrower from Banks or Agent; or any Subsidiary of
Borrower defaults in the performance of any other
covenant and/or agreement set forth in any Loan
Document to which such Subsidiary is a party, which
default shall continue for a period of thirty (30) days
after written notice thereof to Borrower from Banks or
Agent.
11. Section 12.1. Section 12.1 of the Fifth Amended and
Restated Credit Agreement is hereby amended to include the
following substituted or additional definitions:
"Agreement" means this Fifth Amended and Restated
Revolving Credit and Term Loan Agreement, as it has
been amended by that certain First Amendment to Fifth
Amended and Restated Revolving Credit and Term Loan
Agreement and as it may be further amended, restated,
modified and/or supplemented from time to time in the
future.
"Collateral Documents" means the GIF Collateral
Mortgage, the GIF Collateral Chattel Mortgages, the
GIFI Collateral Chattel Mortgage, the Lease Assignment,
the Real Property Collateral Mortgage, the Security
Agreement, the Financing Statement, the Stock Pledge,
the Stock Pledge Financing Statement, the Dolphin
Security Instruments and any and all other documents,
instruments and agreements delivered to Agent or Banks
to secure the Loans and/or any other obligations
described in this Agreement, as the foregoing may be
amended, modified or supplemented from time to time.
"Conversion Date" means June 30, 1997, the date on
which all previously made Non-Revolving Advances shall
automatically convert to a term loan in accordance with
Section 1.1 hereof.
"Debt" means: (a) all obligations of Borrower or
of any of Borrower's Subsidiaries for borrowed money,
(b) all obligations of Borrower or of any of Borrower's
Subsidiaries evidenced by bonds, notes, debentures or
other similar instruments, (c) all obligations of
Borrower or of any of Borrower's Subsidiaries to pay
the deferred purchase price of property or services,
except trade accounts payable by Borrower or by any of
Borrower's Subsidiaries arising in the ordinary course
of business which are not past due by more than sixty
(60) days unless such trade accounts payable are being
contested in good faith by appropriate proceedings,
(d) all obligations of Borrower or of any of
Borrower's Subsidiaries under any Capitalized Leases,
(e) all obligations of Borrower or of any of
Borrower's Subsidiaries under guaranties, endorsements
(other than for collection or deposit in the ordinary
course of business), assumptions or other contingent
obligations, in respect of, or to purchaser or
otherwise acquire, any obligation or indebtedness of
Borrower or of any of Borrower's Subsidiaries, or any
other obligations, contingent or otherwise, (f) all
obligations secured by a Lien (except trade accounts
payable by Borrower or by any of Borrower's
Subsidiaries arising in the ordinary course of business
which are not past due by more than sixty (60) days
unless such trade accounts payable are being contested
in good faith by appropriate proceedings secured by a
vendor's lien) existing on property owned by Borrower
or by any of Borrower's Subsidiaries, whether or not
the obligations secured thereby have been assumed by
Borrower or by any of Borrower's Subsidiaries or are
non-recourse to the credit of Borrower or of any of
Borrower's Subsidiaries, (g) all reimbursement
obligations of Borrower or of any of Borrower's
Subsidiaries, other than performance bonds of Borrower
or of any of Borrower's Subsidiaries (whether
contingent or otherwise), relating to letters of
credit, bankers' acceptances and similar instruments,
and (h) all liabilities of Borrower or of any of
Borrower's Subsidiaries in respect of unfunded vested
benefits under any Plan; provided, however, the term
"Debt" shall not include money borrowed by Borrower or
by any of Borrower's Subsidiaries to pay premiums on
insurance policies obtained by Borrower or by any of
Borrower's Subsidiaries in the ordinary course of
Borrower's or of any of Borrower's Subsidiaries'
business.
"Debt Service" means, for any period in question,
the sum of (a) all interest due and payable by Borrower
or by any of Borrower's Subsidiaries to any Person
during such period and (b) the aggregate amount of all
principal due and payable during such period under this
Agreement and any of the other Loan Documents.
"Eligible Receivables" shall mean, as of any date,
an amount equal to the aggregate invoice amount owing
on all trade accounts receivable of Borrower or of any
of Borrower's Subsidiaries for goods sold, after
deducting each such account that is unpaid ninety (90)
days after the original invoice date thereof.
"Dolphin Companies" has the meaning ascribed in
Section 5.1(c) above, and "Dolphin Company" likewise
has the meaning ascribed in Section 5.1(c) above.
"Dolphin Guaranties" means, collectively, the
Dolphin Sales Guaranty, the Dolphin Services Guaranty,
and the Dolphin Steel Guaranty, and each of such
guaranties may be referred to generically as a "Dolphin
Guaranty".
"Dolphin Mortgage Instruments" means,
collectively, the Dolphin Sales Note, the Dolphin Sales
Mortgage, the Dolphin Sales Pledge, the Dolphin
Services Note, the Dolphin Services Mortgage, and the
Dolphin Services Pledge, and each of such instruments
may be referred to generically as a "Dolphin Mortgage
Instrument".
"Dolphin Real Estate" has the meaning ascribed in
Section 5.1(d) above.
"Dolphin Sales" has the meaning ascribed in
Section 5.1(c) above.
"Dolphin Sales Guaranty" has the meaning ascribed
in Section 5.1(d) above.
"Dolphin Sales Mortgage" has the meaning ascribed
in Section 5.1(d) above.
"Dolphin Sales Note" has the meaning ascribed in
Section 5.1(d) above.
"Dolphin Sales Pledge" has the meaning ascribed in
Section 5.1(d) above.
"Dolphin Sales Real Estate" has the meaning
ascribed in Section 5.1(d) above.
"Dolphin Sales Security Agreement" has the meaning
ascribed in Section 5.1(d) above.
"Dolphin Security Agreements" means, collectively,
the Dolphin Sales Security Agreement, the Dolphin
Services Security Agreement, and the Dolphin Steel
Security Agreement, together with any associated UCC-1
financing statements, and each of such instruments may
be referred to generically as a "Dolphin Security
Agreement".
"Dolphin Security Instruments" means,
collectively, the Dolphin Guaranties, the Dolphin
Mortgage Instruments, and the Dolphin Security
Agreements, and each of such instruments may be
referred to generically as a "Dolphin Security
Instrument".
"Dolphin Services" has the meaning ascribed in
Section 5.1(c) above.
"Dolphin Services Guaranty" has the meaning
ascribed in Section 5.1(d) above.
"Dolphin Services Mortgage" has the meaning
ascribed in Section 5.1(d) above.
"Dolphin Services Note" has the meaning ascribed
in Section 5.1(d) above.
"Dolphin Services Pledge" has the meaning ascribed
in Section 5.1(d) above.
"Dolphin Services Real Estate" has the meaning
ascribed in Section 5.1(d) above.
"Dolphin Services Security Agreement" has the
meaning ascribed in Section 5.1(d) above.
"Dolphin Steel" has the meaning provided in
Section 5.1(c) above.
"Dolphin Steel Guaranty" has the meaning ascribed
in Section 5.1(d) above.
"Dolphin Steel Security Agreement" has the meaning
ascribed in Section 5.1(d) above.
"Environmental Laws" means any and all federal,
state and local laws, regulations, ordinances, orders
and requirements pertaining to health, safety or the
environment, including, without limitation, the
Comprehensive Environmental Response, Compensation and
Liability Act of 1980, 42 U.S.C. Section 9601 et
seq., the Resource Conservation and Recovery Act of
1976, 42 U.S.C. Section 6901 et seq., the Clean Air
Act, 42 U.S.C. Section 7401 et seq., the Clean Water Act,
33 U.S.C. Section 1251 et seq., the Toxic Substances
Control Act, 15 U.S.C. Section 2601 et seq., the
Louisiana Environmental Quality Act, La. R.S. 30:2001,
et seq., and all similar laws, regulations and
requirements of any governmental authority or agency
having jurisdiction over Borrower, any of its Subsidiaries
or any of the property or assets of Borrower or of
any of its Subsidiaries, as such laws, regulations and
requirements may be amended or supplemented from time
to time.
"Equipment" means all machinery, equipment,
furniture and furnishings and other property described
as "General Equipment" in the Security Agreement or as
"equipment" under any of the Dolphin Security
Agreements, now or hereafter owned by Borrower or by
one of Borrower's Subsidiaries.
"Fixtures" means any and all goods and other
property that, after placement on the Real Property,
the GIFI Property, and/or the Dolphin Real Estate,
become component parts thereof.
"Loan Documents" means, collectively, this
Agreement, the Notes, the Collateral Documents, and any
and all other documents, instruments and agreements
executed in connection with the Loans, as the foregoing
may be modified, supplemented and/or amended from time
to time.
"Non-Revolving Commitment" means $15,000,000.
"Stock Pledge" has the meaning ascribed in Section
5.2(c) above.
"Stock Pledge Financing Statement" has the meaning
ascribed in Section 5.2(c) above.
"Subsidiary" means, as to any Person, a
corporation, partnership or other entity of which
shares of stock or other ownership interests having
ordinary voting power (other than stock or such other
ownership interests having such power only by reason of
the happening of a contingency) to elect a majority of
the board of directors or other managers of such
corporation, partnership or other entity, or the
management of which is otherwise controlled, directly
or indirectly through one or more intermediaries, or
both, by such Person.
ARTICLE II
SPECIAL REPRESENTATIONS AND WARRANTIES
WITH RESPECT TO THIS FIRST AMENDMENT
In order to induce Banks and Agent to enter into this First
Amendment, Borrower represents and warrants to Banks that:
1. Borrower Authorization. Borrower is duly authorized to
execute, deliver and perform its obligations under this First
Amendment and is and will continue to be duly authorized to
borrow monies under and to perform its obligations under the
Fifth Amended and Restated Credit Agreement, as amended by this
First Amendment and as it may be further amended from time to
time.
2. Enforceability Against Borrower. This First Amendment
shall, upon execution and delivery, constitute the legal, valid
and binding obligation of Borrower, enforceable in accordance
with its terms.
3. Dolphin Companies Authorization. Each of the Dolphin
Companies is duly authorized to execute, deliver and perform its
obligations under any Dolphin Security Instrument to which it is
a party.
4. Enforceability Against Dolphin Companies. Upon
execution and delivery, each Dolphin Security Instrument shall
constitute the legal, valid and binding obligation of the Dolphin
Company which is a party thereto, enforceable against such
Dolphin Company in accordance with its terms.
5. No Conflicts. The execution and delivery of the
Dolphin Security Instruments and the performance by each of the
Dolphin Companies of their respective obligations thereunder do
not and will not conflict with any provision of law or of the
charter or by-laws of such Dolphin Company or of any agreement
binding upon such Dolphin Company, as the case may be.
ARTICLE III
CONDITIONS PRECEDENT TO EFFECTIVENESS OF THIS
FIRST AMENDMENT
This First Amendment shall become effective as of the date
first above written when and only when (i) Agent shall have
received at the offices of Agent, a counterpart of this First
Amendment executed and delivered by Borrower, the Dolphin
Companies, and Banks and (ii) Agent shall have additionally
received all of the following documents, each document (unless
otherwise indicated) being dated the date of receipt thereof by
Agent, duly authorized, executed and delivered, and in form and
substance satisfactory to Agent and each of the Banks:
(a) Borrower's Resolutions. Copies, duly certified by the
Secretary or Assistant Secretary of Borrower, of the resolutions
of Borrower's Board of Directors authorizing the borrowings under
the Fifth Amended and Restated Credit Agreement, as amended
hereby, and the execution and delivery of this First Amendment
and the Notes.
(b) Term Notes. Borrower's duly executed Term Notes
payable to the order of Banks, in the form attached as Exhibits
"B" and "C" hereto, with appropriate insertions.
(c) Borrower Incumbency Certificate. Certificates of
Borrower's Secretary or Assistant Secretary, substantially in the
form of Exhibit "I" to the Fifth Amended and Restated Credit
Agreement, certifying the names of the officers of Borrower
authorized to execute the Loan Documents, and all other documents
or certificates to be delivered hereunder by Borrower, together
with the true signatures of such officers.
(d) Dolphin Companies' Resolutions. Copies, duly certified
by the Secretary or Assistant Secretary of each of the Dolphin
Companies, of the resolutions of the respective Dolphin
Companies' Boards of Directors, authorizing the execution and
delivery of this Agreement and the Dolphin Security Instruments.
(e) Dolphin Companies' Incumbency Certificates.
Certificate of the Secretaries or Assistant Secretaries of each
of the Dolphin Companies, substantially in the form of
Exhibit "A" to this First Amendment, certifying the names of the
officers of each Dolphin Company authorized to execute this
Agreement and the Dolphin Security Instruments, and all other
documents or certificates to be delivered hereunder by the
Dolphin Companies, together with true signatures of such
officers.
(f) Title Insurance. Mortgagee's title insurance
commitments issued by Lawyers Title Insurance Corporation to
First NBC, as Agent for Banks, in form and substance satisfactory
to Banks and containing such endorsements as are required by
Banks and, with respect to the Dolphin Sales Property, with
coverage in the amount of $250,000 and with respect to the
Dolphin Services Property, with coverage in the amount of
$1,750,000.
(g) Environmental Report. A Phase I environmental report
prepared by Walk, Haydel & Associates, Inc., dated December,
1996, certified to each Bank, reporting the current environmental
condition of the Dolphin Sales Property and the Dolphin Services
Property.
(h) Dolphin Security Instruments. Duly authorized and
executed originals of each of the Dolphin Security Instruments.
(i) Lien Searches. Uniform Commercial Code and chattel
mortgage searches in the name of Borrower and each Dolphin
Company which confirm that the Liens granted to Banks by Borrower
and the Dolphin Companies are first priority liens.
(j) Delivery of Stock Certificates. The stock
certificates, registered in Borrower's name and subject to no
transfer or pledge restrictions, representing the shares pledged
to Banks pursuant to the Stock Pledge, together with blank stock
powers executed by Borrower and in form and substance acceptable
to Banks.
(k) Proof of Flood Insurance. Proof, in form and substance
acceptable to Banks, that Dolphin Sales and Dolphin Services
maintain all flood insurance with respect to the Dolphin Real
Estate which they are legally required to maintain as a
condition to the use of such Dolphin Real Estate to collateralize
their respective Dolphin Guaranties, the Notes, and Borrower's
other Obligations to Banks.
ARTICLE IV
MISCELLANEOUS
1. Definitions. All terms used herein with initial
capital letters and not otherwise defined herein shall have the
meanings ascribed to such terms in the Fifth Amended and Restated
Credit Agreement.
2. No Other Changes. The Fifth Amended and Restated
Credit Agreement as hereby amended is hereby ratified and
confirmed in all respects. Any reference to the Fifth Amended
and Restated Credit Agreement in any Loan Document shall be
deemed to refer to the Fifth Amended and Restated Credit
Agreement as amended hereby. Any reference to the Term Notes in
any Loan Document shall be deemed to refer to the Term Notes
executed of even date herewith in the forms of Exhibits "B" and
"C" attached hereto. The execution, delivery and effectiveness
of this First Amendment shall not, except as expressly provided
herein, operate as a waiver of any right, power or remedy of
Banks under the Fifth Amended and Restated Credit Agreement or
any other Loan Document. Except as amended by this First
Amendment, the Fifth Amended and Restated Credit Agreement shall
remain in full force and effect. Nothing contained herein or in
any other documents contemplated hereby shall be considered a
novation or discharge of the debt of Borrower to Banks under the
Fifth Amended and Restated Credit Agreement.
3. Ratification of Notes and Liens. Borrower does hereby
ratify, reaffirm and acknowledge its obligations under the
Revolving Notes, and Borrower does hereby further ratify,
reaffirm and acknowledge its mortgage, pledge and/or assignment
of, and/or grant of a security interest in, all Collateral
heretofore provided by Borrower as security for the Notes and the
other Obligations under the Fifth Amended and Restated Credit
Agreement. Borrower does hereby further ratify, confirm and
acknowledge to Agent and Banks that: (a) the mortgage, pledge
and/or assignment of, and/or grant of a security interest in, all
such Collateral is and shall remain in full force and effect; (b)
the Collateral Documents to which Borrower is a party are and
shall continue to be valid, binding and enforceable obligations
of Borrower; and (c) the Collateral Documents and the Collateral
shall continue to secure, with retroactive priority to the extent
permitted by law, the Notes and the other Obligations of Borrower
as continued pursuant to the Revolving Notes and as renewed,
rearranged, extended and now evidenced by, and as the amount
thereof has been increased by, the Term Notes executed of even
date herewith in the forms attached hereto as Exhibits "B" and
"C".
4. Substitution and Addition of Exhibits and Schedule.
Exhibits "B" and "C" of the Fifth Amended and Restated Credit
Agreement are hereby deleted, and Exhibits "B" and "C" attached
hereto are hereby substituted in place thereof. New Exhibits "L"
(describing the Dolphin Sales Real Estate) and "M" (describing
the Dolphin Services Real Estate) are hereby added to the Fifth
Amended and Restated Credit Agreement. Schedule 1 of the Fifth
Amended and Restated Credit Agreement is hereby deleted, and
Schedule 1 attached hereto is hereby substituted in place
thereof.
5. Counterparts. This First Amendment may be executed in
as many counterparts as may be deemed necessary or convenient,
and by the different parties hereto in separate counterparts,
each of which, when so executed, shall be deemed an original, but
all of which counterparts shall constitute but one and the same
instrument.
IN WITNESS WHEREOF, the parties hereto have caused this
First Amendment to be executed by their respective officers
thereunto duly authorized, effective as of the date first written
above.
BORROWER:
GULF ISLAND FABRICATION, INC.
By: /s/ Kerry J. Chauvin
--------------------------------
Kerry J. Chauvin, President
BANKS:
FIRST NATIONAL BANK OF COMMERCE
By: /s/ J. Charles Freel, Jr.
--------------------------------
J. Charles Freel, Jr.,
Vice President
WHITNEY NATIONAL BANK
By: /s/ Harry C. Stahel
--------------------------------
Harry C. Stahel,
Senior Vice President
AGENT:
FIRST NATIONAL BANK OF COMMERCE
By: /s/ J. Charles Freel, Jr.
--------------------------------
J. Charles Freel, Jr.,
Vice President
INTERVENTION
NOW INTO THESE PRESENTS COMES Dolphin Sales & Rentals, Inc.,
Dolphin Steel Sales, Inc., and Dolphin Services, Inc., who hereby
bind themselves in solido with each other and with Borrower with
respect to all representations and warranties contained
Article I, Section 8 and Article II, Sections 3, 4, and 5 of
this First Amendment to Fifth Amended and Restated Credit
Agreement and who, in order to induce Banks to enter into this
First Amendment to Fifth Amended and Restated Credit Agreement,
agree to execute and deliver to Banks the Dolphin Security
Instruments as defined herein.
DOLPHIN SALES & RENTALS, INC.
By: /s/ Kerry J. Chauvin
-------------------------------
Kerry J. Chauvin, President
DOLPHIN STEEL SALES, INC.
By: /s/ Kerry J. Chauvin
-------------------------------
Kerry J. Chauvin, President
DOLPHIN SERVICES, INC.
By: /s/ Kerry J. Chauvin
-------------------------------
Kerry J. Chauvin, President
ACKNOWLEDGMENT
STATE OF LOUISIANA
PARISH OF ORLEANS
BE IT KNOWN, that on this 2nd day of January, 1997, before
me, the undersigned authority, duly commissioned, qualified and
sworn within and for the State and Parish aforesaid, personally
came and appeared KERRY J. CHAUVIN, appearing herein in his
capacity as President of Gulf Island Fabrication, Inc., to me
personally known to be the identical person whose name is
subscribed to the foregoing First Amendment to Fifth Amended and
Restated Revolving Credit and Term Loan Agreement, who declared
and acknowledged to me, Notary, in the presence of the
undersigned competent witnesses, that he executed the same on
behalf of said corporation with full authority of its Board of
Directors, and that the same instrument is the free act and deed
of the said corporation and was executed for the uses, purposes
and benefits therein expressed.
WITNESSES:
/s/ Patsy G. Holwadel /s/ Kerry J. Chauvin
------------------------- --------------------------
KERRY J. CHAUVIN
/s/ Scott D. Morgan
-------------------------
/s/ F. Rivers Lelong, Jr.
---------------------------------
NOTARY PUBLIC
ACKNOWLEDGMENT
STATE OF LOUISIANA
PARISH OF ORLEANS
BE IT KNOWN, that on this 2nd day of January, 1997, before
me, the undersigned authority, duly commissioned, qualified and
sworn within and for the State and Parish aforesaid, personally
came and appeared J. CHARLES FREEL, JR., appearing herein in his
capacity as Vice President of First National Bank of Commerce, to
me personally known to be the identical person whose name is sub-
scribed to the foregoing First Amendment to Fifth Amended and
Restated Revolving Credit and Term Loan Agreement, who declared
and acknowledged to me, Notary, in the presence of the
undersigned competent witnesses, that he executed the same on
behalf of said national banking association, appearing in said
agreement in its individual capacity and its capacity as Agent,
with full authority of its Board of Directors, and that the same
instrument is the free act and deed of the said national bank
association and was executed for the uses, purposes and benefits
therein expressed.
WITNESSES:
/s/ Patsy G. Holwadel /s/ J. Charles Freel, Jr.
-------------------------- ----------------------------
J. CHARLES FREEL, JR.
/s/ Scott D. Morgan
--------------------------
/s/ F. Rivers Lelong, Jr.
------------------------------
NOTARY PUBLIC
ACKNOWLEDGMENT
STATE OF LOUISIANA
PARISH OF ORLEANS
BE IT KNOWN, that on this 2nd day of January, 1997, before
me, the undersigned authority, duly commissioned, qualified and
sworn within and for the State and Parish aforesaid, personally
came and appeared HARRY C. STAHEL, appearing herein in his
capacity as Senior Vice President of Whitney National Bank, to me
personally known to be the identical person whose name is sub-
scribed to the foregoing First Amendment to Fifth Amended and
Restated Revolving Credit and Term Loan Agreement, who declared
and acknowledged to me, Notary, in the presence of the
undersigned competent witnesses, that he executed the same on
behalf of said national banking association, appearing in said
agreement in its individual capacity, with full authority of its
Board of Directors, and that the same instrument is the free act
and deed of the said national bank association and was executed
for the uses, purposes and benefits therein expressed.
WITNESSES:
/s/ Patsy G. Holwadel /s/ Harry C. Stahel
------------------------ ---------------------------
HARRY C. STAHEL
/s/ Scott D. Morgan
------------------------
/s/ F. Rivers Lelong, Jr.
---------------------------------
NOTARY PUBLIC
ACKNOWLEDGMENT
STATE OF LOUISIANA
PARISH OF ORLEANS
BE IT KNOWN, that on this 2nd day of January, 1997, before
me, the undersigned authority, duly commissioned, qualified and
sworn within and for the State and Parish aforesaid, personally
came and appeared KERRY J. CHAUVIN, appearing herein in his
capacity as President of Dolphin Sales & Rentals, Inc., to me
personally known to be the identical person whose name is
subscribed to the foregoing First Amendment to Fifth Amended and
Restated Revolving Credit and Term Loan Agreement, who declared
and acknowledged to me, Notary, in the presence of the
undersigned competent witnesses, that he executed the same on
behalf of said corporation with full authority of its Board of
Directors, and that the same instrument is the free act and deed
of the said corporation and was executed for the uses, purposes
and benefits therein expressed.
WITNESSES:
/s/ Patsy G. Holwadel /s/ Kerry J. Chauvin
-------------------------- --------------------------
KERRY J. CHAUVIN
/s/ Scott D. Morgan
--------------------------
/s/ F. Rivers Lelong, Jr.
---------------------------------
NOTARY PUBLIC
ACKNOWLEDGMENT
STATE OF LOUISIANA
PARISH OF ORLEANS
BE IT KNOWN, that on this 2nd day of January, 1997, before
me, the undersigned authority, duly commissioned, qualified and
sworn within and for the State and Parish aforesaid, personally
came and appeared KERRY J. CHAUVIN, appearing herein in his
capacity as President of Dolphin Steel Sales, Inc., to me
personally known to be the identical person whose name is
subscribed to the foregoing First Amendment to Fifth Amended and
Restated Revolving Credit and Term Loan Agreement, who declared
and acknowledged to me, Notary, in the presence of the
undersigned competent witnesses, that he executed the same on
behalf of said corporation with full authority of its Board of
Directors, and that the same instrument is the free act and deed
of the said corporation and was executed for the uses, purposes
and benefits therein expressed.
WITNESSES:
/s/ Patsy G. Holwadel /s/ Kerry J. Chauvin
--------------------------- ----------------------------
KERRY J. CHAUVIN
/s/ Scott D. Morgan
---------------------------
/s/ F. Rivers Lelong, Jr.
------------------------------------
NOTARY PUBLIC
ACKNOWLEDGMENT
STATE OF LOUISIANA
PARISH OF ORLEANS
BE IT KNOWN, that on this 2nd day of January, 1997, before
me, the undersigned authority, duly commissioned, qualified and
sworn within and for the State and Parish aforesaid, personally
came and appeared KERRY J. CHAUVIN, appearing herein in his
capacity as President of Dolphin Services, Inc., to me personally
known to be the identical person whose name is subscribed to the
foregoing First Amendment to Fifth Amended and Restated Revolving
Credit and Term Loan Agreement, who declared and acknowledged to
me, Notary, in the presence of the undersigned competent
witnesses, that he executed the same on behalf of said
corporation with full authority of its Board of Directors, and
that the same instrument is the free act and deed of the said
corporation and was executed for the uses, purposes and benefits
therein expressed.
WITNESSES:
/s/ Patsy G. Holwadel /s/ Kerry J. Chauvin
------------------------- --------------------------
KERRY J. CHAUVIN
/s/ Scott D. Morgan
-------------------------
/s/ F. Rivers Lelong, Jr.
---------------------------------------
NOTARY PUBLIC