Document:

Exhibit 4

EXHIBIT 4.9

 

STOCKHOLDERS’

AGREEMENT

 

AGREEMENT dated as of the 14th

day of March, 2000 by and among NE Restaurant Company, Inc., a Delaware

corporation (hereinafter referred to as the “Corporation”), and each of the

parties listed on Exhibit A attached hereto (hereinafter, with any other

parties who have executed this Agreement or a counterpart hereof, collectively

referred to as the “Stockholders” or individually as a “Stockholder”).

 

W  I  T

N  E  S  S  E  T  H :

 

WHEREAS, the Corporation is

authorized to issue a total of 8,000,000 shares of Common Stock, $.01 par value

(“Common Stock” or the “Stock”);

 

WHEREAS, a total of

2,986,622 shares of Common Stock are issued and outstanding as of the date

hereof;

 

WHEREAS, the Stockholders

own all of the issued and outstanding shares of Stock of the Corporation as of

the date hereof;

 

WHEREAS, each of the

Stockholders listed on Exhibit A has entered into either the Stockholder

Agreement, dated as of December 31, 1993, as amended (the “Original

Agreement”), by and among certain of the Stockholders and the Corporation or

the Stockholder Agreement, dated as of September 15, 1997 (the “Employee

Agreement”), by and among the employee Stockholders of the Corporation and the

Corporation;

 

WHEREAS, the Corporation and

the Stockholders listed on Exhibit A desire to combine the Original Agreement

and the Employee Agreement into one Agreement between the Corporation and all

of the Stockholders, and to modify same all upon the terms and conditions set

forth in this Agreement;

 

NOW, THEREFORE, in

consideration of the mutual promises and covenants contained herein and for

other good and valuable consideration, receipt and sufficiency of which is

hereby acknowledged, the Corporation and the Stockholders agree as follows.

 

ARTICLE

1

 

DEFINITIONS

 

1.1           For purposes of this Agreement, the following terms shall

have the indicated respective meanings (other capitalized terms are defined

elsewhere in this Agreement):

 

“Affiliate” with

respect to any person means any person controlled by, controlling or under

common control with such person.

 

“Cause”, with respect

to an Employee Stockholder, means any of the following committed by an Employee

Stockholder, directly or indirectly:

 

(i)            Commission by the Employee Stockholder of an act of

dishonesty involving the Corporation;

 

(ii)           Failure by the Employee Stockholder to perform a material

portion of his duties (not otherwise excused by the disability of the Employee

Stockholder), or material breach by the Employee Stockholder of any

representation, warranty or agreement of the Employee Stockholder made in any

agreement between the Employee Stockholder and the Corporation, which continues

for a period of thirty (30) days after written notice from the Corporation to

the Employee Stockholder;

 

(iii)          Commission by the Employee Stockholder of an act of gross

incompetence in the course of his employment with the Corporation;

 

(iv)          The Employee Stockholder’s use of drugs or alcohol which

interferes with the Employee Stockholder’s

 

 

performance of his duties or responsibilities

to the Corporation; or

 

(v)           The Employee Stockholder is found guilty or pleads nolo

contendere to the commission of a felony or serious misdemeanor

offense.

 

“Board of Directors”

means the Board of Directors of the Corporation.

 

“Employee Stockholder”

means a Stockholder who is an employee of the Corporation on the date hereof or

on the date on which such Stockholder acquires any Stock.

 

“Exchange Act” means

the Securities Exchange Act of 1934, as amended, or any similar Federal

statute, and the rules and regulations of the Securities and Exchange

Commission issued under the Exchange Act, as they each may, from time to time,

be in effect.

 

“Franchise Agreement”

means any franchise, development or other agreement between the Corporation and

any of its franchisors, as any such agreement may be amended from time to time.

 

“Immediate Family Member”

with respect to any individual means the spouse, sibling, parent, child,

grandchild or great-grandchild of such individual.

 

“Permitted Transfers”

means any of the following transfers of Stock by a Stockholder:

 

(i)            any transfer involving the

distribution by any Stockholder which is a general or limited partnership to

any of its partners as of the date hereof;

 

(ii)           any transfer involving the distribution

by any Stockholder which is a corporation to any of its stockholders as of the

date hereof;

 

(iii)          any transfer involving the

distribution by any Stockholder which is a trust to any of its beneficiaries;

 

(iv)          any transfer involving the

distribution by any Stockholder which is a limited liability company to any of

its members as of the date hereof;

 

(v)           any transfers by will or intestate

succession;

 

(vi)          any transfer to a Stockholder,

provided that such transfer is approved by a majority of the Board of

Directors;

 

(vii)         any transfer to any Immediate Family

Member of any Stockholder, to any trust for the benefit of one or more

Immediate Family Members of any Stockholder or to any limited partnership owned

or controlled by any Stockholder or Immediate Family Member of any Stockholder;

 

(viii)        any transfer to any Affiliate of any

Stockholder as of the date hereof; and

 

(ix)           any transfer unanimously approved by

all of the members of the Board of Directors then in office;

 

provided that any such transfer is made in

compliance with all securities and other laws applicable thereto.

 

“Securities Act”

means the Securities Act of 1933, as amended.

 

“Selling Stockholder”

means a Stockholder proposing to transfer such Stockholder’s Stock.

 

“Subsidiary” means

any corporation, association, trust, partnership or business entity of which

the Corporation shall at any time own, directly or indirectly, at least fifty

percent (50%) or more of the voting or equity interest therein.

 

“Voting Stock” means

the Common Stock.

 

2

 

ARTICLE

2

 

RESTRICTION

ON TRANSFERS

 

2.1           General.  No

Stockholder may transfer any interest in the Stock (whether by way of gift,

sale, transfer, assignment, pledge, hypothecation, grant of security interest

or otherwise), unless there shall have first been compliance with Section 2.2,

and, if applicable, Article 3, and unless the transferee agrees in writing to

be bound by this Agreement.

 

2.2           Conditions to Transfers.  (a)              No transfer

may be made without the consent of the Corporation if the transfer would

require filing of a registration statement under the Securities Act or

registration or notice subject to review under any state securities or blue sky

laws or regulations or violate any applicable federal or state securities or

blue sky laws (including any investment suitability standards) or regulations

applicable to the Corporation or the Common Stock.  The Corporation may rely upon the advice of counsel in making any

determination under this paragraph (a).

 

(b)           The Stockholders further understand and agree that,

notwithstanding any other provision of this Agreement, a proposed transfer may

be subject to (i) the prior approval of applicable liquor licensing

authorities, one or more of the Corporation’s landlords, one or more of  the

Corporation’s lenders or bondholders and/or any franchisor of the Corporation

and (ii) the right of first refusal of any franchisor as may be set forth in

any Franchise Agreement, or otherwise, as if such right of first refusal were

set forth herein.  The Corporation may

rely upon the advice of counsel in making any determination under this

paragraph (b).  If approval or consent

of any such entities is required prior to a transfer, such transfer shall not

be effective until all such approvals and consents are obtained.

 

(c)           The Corporation may require as a condition of any transfer

that the assigning Stockholder assume all costs incurred by the Corporation in

connection therewith, including, but not limited to, legal fees and accounting

fees and any filings or other actions required to be taken with respect to the

Corporation’s liquor licenses or any action take in connection with obtaining

approvals or consents as described in paragraph (b) above.  As a further condition of a transfer, the

Corporation may require that the assigning Stockholder furnish an opinion of

counsel satisfactory to the Corporation that the proposed transfer does not

violate the provisions of paragraphs (a) and (b) above.

 

2.3.          Transfers In Violation.  Any sale, assignment, transfer, pledge, hypothecation, grant of

security interest or disposition of any Stock, by gift or otherwise, which is

in violation of any provision of this Agreement shall be void and of no effect,

and shall not be recognized by the Corporation as transferring any interest in

any of the Stock.  The Corporation shall

not transfer any Stock unless and until it has received reasonable assurance of

compliance with this Agreement in connection with such transfer.

 

ARTICLE

3

 

RIGHT

OF FIRST REFUSAL

 

3.1           Right of First Refusal.  Except for a Permitted Transfer, a Selling Stockholder may not

sell, assign, transfer, pledge, grant a security interest in or otherwise

dispose of any shares of Stock, or any interest therein now held or hereafter

acquired, without first giving written notice (a “Proposed Sale Notice”) to the

Corporation and all other Stockholders (the “Offeree Stockholders”).  The Proposed Sale Notice shall include the

name of the Selling Stockholder and the proposed transferee and all material

terms of the proposed transfer and shall be accompanied by a copy of the bona

fide written offer to purchase such Stock (the “Offered Shares”).  Any such offer must be for cash (which may

include obligations to make deferred cash payments which may be represented by

a note).  The Proposed Sale Notice to

the Corporation and the Offeree Stockholders shall be deemed for all purposes

to give each of the Corporation and the Offeree Stockholders a first right of

purchase (sometimes referred to as a right of first refusal) to purchase all,

but not less than all, of the Offered Shares as provided in this Article

3.  If the Corporation and the Offeree

Stockholders decline or fail to exercise their first right of purchase to

purchase all of the Offered Shares within the time provided in Sections 3.2 and

3.3, respectively, the Selling Stockholder may, within thirty (30) days from

the date the last to expire of such rights terminates in accordance with this

Agreement, transfer the Offered Shares upon terms that are no more favorable to

the transferee than as set forth in the Proposed Sale Notice; provided, however,

that the transferee agrees to become a party to and bound by the terms of this

Agreement as a Stockholder hereunder. 

If such sale is not consummated within the thirty (30) day period

provided in this Section 3.1, the Selling Stockholder shall not be free to sell

any shares of Stock without again complying with the provisions

 

3

 

of this Article 3.

 

3.2           Corporation First Right of Purchase.  Upon receipt of a Proposed Sale Notice, the

Corporation shall have a first right to purchase any or all of the Offered

Shares at the price and in the manner specified herein, before any other action

is taken to sell, assign, transfer, pledge, grant a security interest in or

otherwise dispose of the Stock.  Such

right shall continue for a period of thirty (30) days from the receipt of the

Proposed Sale Notice.  If the

Corporation elects to exercise its first right of purchase, the Corporation

shall so notify the Selling Stockholder and the Offeree Stockholders,

specifying the number of Offered Shares that the Corporation has elected to

purchase and the remaining Offered Shares (the “Remaining Shares”) for sale to

the Offeree Stockholders.

 

3.3           Stockholder Second Right of Purchase.  If the Corporation does not elect to

purchase all of the Offered Shares, the Offeree Stockholders shall have a right

to purchase the Remaining Shares, at the price and in the manner specified

herein, before any other action is taken to sell, assign, transfer, pledge,

grant a security interest in or otherwise dispose of the Offered Shares.  Such right shall continue for a period

ending ten (10) days after the Offeree Stockholder receives the Corporation’s

notice to the Selling Stockholder and the Offeree Stockholders that the

Corporation has not elected to purchase all the Offered Shares (the “Offer

Termination Date”).  If an Offeree

Stockholder elects to exercise its right of purchase, the Offeree Stockholder

shall so notify the Selling Stockholder and the Corporation of the number of

shares of Stock that the Offeree Stockholder has elected to purchase.  If the Offeree Stockholders do not elect to

purchase all the Remaining Shares, the Corporation shall have the further right

to elect to purchase, not later than five (5) business days after the Offer

Termination Date, the Remaining Shares which the Offeree Stockholders have not

elected to purchase.  If more than one

of the Offeree Stockholders elects to purchase more than all the Remaining

Shares, the Remaining Shares shall be allocated among the Offeree Stockholders

pro rata according to their then respective percentage interests in the

outstanding Stock of the Corporation, or as such Offeree Stockholders may agree

in writing.  If the Corporation and the

Offeree Stockholders have not elected to purchase all of the Offered Shares by

the Offer Termination Date with respect to the Offeree Stockholders and by five

(5) business days thereafter with respect to the Corporation, the Corporation

and the Offeree Stockholders shall be deemed not to have elected to purchase

any Offered Shares hereunder.

 

3.4           Terms of Purchase Price.  The price and terms upon which the Corporation and the Offeree

Stockholders may purchase the Stock if they elect to exercise their first right

of purchase, exercisable within the periods specified in Sections 3.2 and 3.3,

shall be the price and terms set forth in the Proposed Sale Notice.

 

3.5           Tender and Payment.  All shares of Stock which the Corporation and the Offeree

Stockholders have elected to purchase hereunder shall be tendered at the

principal office of the Corporation within a reasonable date and time agreed to

by the Selling Stockholder and the Corporation and Offeree Stockholders, as

applicable (and in any event within fifteen (15) days after the Corporation and

the Offeree Stockholders have elected to purchase the Offered Shares) by

delivery of certificates representing such shares, endorsed in blank and in

proper form for transfer against payment of the purchase price.  The purchase price shall be payable in cash

or by certified or bank check or wire transfer, or in accordance with deferred

payment provisions, if any, set forth in the Proposed Sale Notice.

 

ARTICLE

4.

 

RIGHT

OF REPURCHASE ON TERMINATION OF

EMPLOYEE

STOCKHOLDER OR TRANSFER EVENT

 

(i)                                     a Stockholder

voluntarily files a petition under any bankruptcy or insolvency law or a

petition for the appointment of a receiver, or makes an assignment for the

benefit of creditors;

 

(ii)                                  a Stockholder

is subjected involuntarily to such a petition or assignment, or any creditor or

other person obtains an attachment or other legal or equitable interest in any

Stock of a Stockholder, and such involuntary petition, assignment or attachment

is not discharged within thirty (30) days after creation; or

 

(iii)                               a Stockholder

is subject to a judgment, court order or decree or by operation of law is

otherwise required to transfer Stock in other than a Permitted Transfer;

 

4

 

A Stockholder shall, within ten (10) days of the occurrence of a

Transfer Event give written notice thereof to the Corporation.

 

(b)                                                                                 Upon receipt of

written notice of occurrence of a Transfer Event, the Corporation shall have a

right to purchase any or all of the shares of Stock to which such Transfer

Event relates (the “Transfer Shares”) at the lower of Fair Value, as defined in

Section 5.1, or the original purchase price of such shares before any other

action is taken to sell, assign, transfer, pledge, grant a security interest in

or otherwise dispose of the Transfer Shares. Such  right shall continue for a period of one hundred twenty (120)

days from the receipt of written notice of a Transfer Event, and in any event

shall continue for fifteen (15) days from the date of the receipt by the

Corporation of an appraisal made pursuant to Section 5.1.

 

(c)                                                                                  If the

Corporation does not elect to purchase all of the Transfer Shares,

all other Stockholders shall have a right to purchase the remaining Transfer

Shares, at the price specified in Section 4.2(b) and in the manner specified

herein.  Such right shall continue for a

period ending ten (10) days after the Stockholder receives the Corporation’s

notice that the Corporation has not elected to purchase all the Transfer

Shares.  If a Stockholder elects to

exercise its right of purchase, the Stockholder shall so notify the Corporation

and the holder of such Transfer Shares of the number of Transfer Shares that

the Stockholder has elected to purchase. 

If more than one of the Stockholders elects to purchase more than all

the remaining Transfer Shares, the remaining Transfer Shares shall be allocated

among the Stockholders pro rata according to their then respective percentage

interests in the outstanding Stock of the Corporation, or as such Stockholders

otherwise may agree in writing.  If the

Corporation and the Stockholders shall be deemed not to have elected to

purchase any Transfer Shares hereunder, and the legal representative, beneficiary,

trustee, assignee, receiver or other transferee who obtained the Transfer

Shares by reason of the Transfer Event may retain the Transfer Shares, subject

to the provisions of this Agreement.

 

DETERMINATION

OF FAIR VALUE

 

5.1           Determination of Fair Value.               When used with reference to the Stock, Fair Value for

Stock shall be determined by agreement of the purchasing and selling parties

within fifteen (15) days after written request therefore from one party to the

other.  In the event such Fair Value

cannot be so determined within such time period, each party shall select an

experienced investment banking firm or independent appraiser by notice to the

other within ten (10)  days after

written request by either.  In the event

both parties do not select the same firm, the two (2) firms selected shall

select a third experienced investment banking firm or independent appraiser

which shall, within thirty (30) days after selection, determine the Fair Value

of the Stock.  Fair Value shall be the

amount which the selected firm determines would be paid per share by a third

party to acquire the stock of the Corporation proposed to be sold, assuming the

payment of the purchase price in cash at closing, pursuant to open and

competitive bidding conducted by a knowledgeable and experienced investment

banking firm, assuming a reasonable time (up to 12 months) to accomplish such

sale and complete cooperation by management, with appropriate reduction for the

fact that the Stock being valued constitutes a minority interest and that there

is no public market for such Stock.  In

the even the investment banking firm or independent appraiser selected provides

a range of values as opposed to a single value, the Fair Value shall be the

median of the range of values.  The

determination of Fair Value by such appraiser or investment banking firm will

be final and binding on all parties concerned. 

All costs of such determination shall be borne equally be the purchasing

and selling parties.

 

ARTICLE

6

 

MISCELLANEOUS

 

6.1           Agreement to Vote on Franchise Matters.  Each Stockholder hereby agrees to vote all

capital stock of the Corporation held by such Stockholder and entitled to vote

in the manner that the Chairman of the Board of Directors of the Corporation

shall direct,  in the event (and only in

the event) that the Stockholders are entitled to cast votes on any matter

relating to action which the Corporation is required to take or omit to take

under the express terms of any Franchise

 

5

 

Agreement.

 

6.2           Certificates Legended.  Upon the execution of this Agreement, and during the term of this

Agreement, each certificate evidencing Stock held by a Stockholder or

transferee shall be conspicuously legended as follows:

 

The shares of stock

evidenced by this certificate have not been registered under the Securities Act

of 1933 or applicable state securities law, and accordingly, the stock may not

be transferred, sold, pledged, hypothecated or otherwise disposed of in the

absence of registration under such Act and such laws or pursuant to an

exemption therefrom.  In addition, the

shares are subject to the restrictions of, and are transferable only upon

compliance with the provisions of, a Stockholders’ Agreement between the

corporation and the holders of certain securities of the corporation.  A copy of said Agreement is on file in the

office of the corporation, and a copy thereof will be mailed to the holder

hereof without charge upon receipt of a written request therefore.

 

6.3           Additional Parties.  Transferees or successors or additional holders of Stock may

become parties to this Agreement by endorsing a schedule attached hereto or by

executing a counterpart of this Agreement. 

An original copy of this Agreement and of any counterpart subsequently

executed shall be kept by the Secretary of the Corporation.

 

6.4           Shares of Stock. 

This Agreement shall apply to all shares of Stock of the Corporation now

or hereafter owned by the Stockholders or any transferees of the Stockholders,

including dividends of shares of Stock and any shares of Stock received with

respect to shares of Stock of the Corporation as the result of a merger,

consolidation, tax-free exchange, or other transaction in which the

Stockholders or their transferees receive shares of Stock in exchange for, or

with respect to, Stock.

 

6.5           Stock Transfer Record.  The Corporation shall not effect or record any transfer of shares

of Stock in its stock transfer records unless such transfer is in compliance

with the provisions of this Agreement. 

If a Stockholder desires to make a transfer, such Stockholder shall

furnish to the Corporation such evidence of compliance with this Agreement as

may be reasonably required by the Board of Directors of, or counsel for, the

Corporation.

 

6.6           Successors and Assigns.  This Agreement shall be binding upon the parties hereto and their

heirs, representatives, successors and assigns.

 

6.7           Notices. 

All notices to a party hereto shall be in writing and shall be deemed to

have been adequately given if delivered in person (including, without

limitation, by courier, Federal Express, or other overnight messenger service),

or mailed by United States certified mail, postage prepaid, return receipt

requested, addressed as follows:

 

If to the Corporation:

 

NE Restaurant Company, Inc.

5 Clock tower Place, Suite

200

Maynard, MA 01754

Attention:  General Counsel

 

If to a Stockholder:

 

The address for such

Stockholder previously provided to the Corporation by such Stockholder and on

file at the Corporation’s corporate office or to such other address as any

party may from time to time designate for itself by notice in writing given to

the other parties hereto.

 

6.8           Term and Termination.  This Agreement and all obligations of the parties hereunder other

than Section 6.12 which shall survive the termination of this Agreement, shall

terminate on the earlier of:

 

(i)            if the Corporation

is merged into or consolidated with another corporation or sells or transfers

substantially all of its assets to any other party or corporation (and the restrictions

herein contained shall not apply to that transaction) if the holders of voting

securities of the Corporation immediately prior to such merger, consolidation

or sale do not continue to own at least fifty-one percent

 

6

 

(51%)

of the voting securities of the surviving entity;

 

(ii)           if the Corporation

consummates a public offering of the Common Stock pursuant to a registration

statement declared effective under the Securities Act;

 

(iii)          upon mutual written

agreement in accordance with Section 6.9 hereof;

 

(iv)          if the Corporation

voluntarily files a petition under any bankruptcy or insolvency law or a

petition for the appointment of a receiver, or makes an assignment for the

benefit of creditors; or

 

(v)           if the Corporation

is subjected involuntarily to such a petition or assignment, and such

involuntary petition or assignment is not dissolved within one hundred twenty

(120) days of creation.

 

6.9           Waiver and Amendments.  The parties may terminate, amend or modify this Agreement in such

manner as may be agreed upon, with the written consent of the holders of

two-thirds (66 2/3%) of the aggregate outstanding shares of Voting Stock owned

by the Stockholders; provided, however, that no amendment to this Agreement

shall be valid as to a Stockholder that materially increases any of such

Stockholder’s obligations hereunder without the written consent of such

Stockholder.  No party shall be deemed

to waive any rights hereunder, unless such waiver is in writing and signed by

such party.  A waiver in writing on one

occasion shall not be construed as a consent to or a waiver of any right or

remedy on any future occasion.

 

6.10         Entire Agreement. 

This Agreement shall supercede and replace the Original Agreement and

the Employee Agreement which are hereby terminated and shall constitute the

entire agreement between the parties, and all premises, representations,

understandings, warranties and agreements with reference to the subject matter

hereof have been expressed herein or in the documents incorporated herein by

reference.

 

6.11         Applicable Law; Severability.  This Agreement shall be governed by and

construed and enforced in accordance with the internal laws of the State of

Delaware.  Wherever possible, each

provision of this Agreement shall be interpreted in such manner as to be

effective and valid under applicable law, but if any provision hereof shall be

prohibited by or invalid under any such law, that provision shall be

ineffective only to the extent of such prohibition or invalidity, without

invalidating or nullifying the remainder of that provision or any other

provisions of this Agreement.

 

6.12         Confidentiality. 

The Stockholders each agree that they will keep confidential and not

disclose or divulge any confidential, proprietary or secret information which

they may obtain from the Corporation; provided, however, that on

their request of any regulatory body having jurisdiction over the Stockholder

or if otherwise required by law, the Stockholder may disclose such matters that

only to the extent required by such regulatory body or law; provided, further,

that a Stockholder may make such disclosures on a confidential basis to its or

their members, partners or beneficiaries as may be necessary under its or their

organizational documents or as the Stockholder may deem reasonably

advisable.  The Stockholders each

further agree that this Section 6.12 shall survive the termination of this

Agreement.

 

6.13         Specific Performance.  Due to the fact that the Stock cannot be readily purchased or

sold in the open market, and for other reasons, the parties will be irreparable

damaged in the event that this Agreement is not specifically enforced.  In the event of a breach or threatened

breach of the terms, covenants and/or conditions of this Agreement by any of

the parties hereto, the other parties shall, in addition to all other remedies,

be entitled to a temporary or permanent injunction, without showing any actual

damage, and/or a decree for specific performance in accordance with the

provisions hereof.

 

6.14         Counterparts. 

This Agreement may be executed in multiple counterparts, each of which

shall be deemed in original but all of which together shall constitute one and

the same instrument.

 

6.15         Effect of Headings. 

Any table of contents, title of an article or section heading herein

contained is for convenience or reference only and shall not affect the meaning

of construction of any of the provisions hereof.

 

[Remainder

of Page Intentionally Left Blank]

 

7

 

Stockholder

Agreement

Signature

Page

 

 

IN WITNESS WHEREOF, each

Stockholder has hereunto set his hand and the Corporation has authorized this

instrument to be signed by its officers thereunto duly authorized, effective as

an instrument under seal.

 

 

	

  THE CORPORATION:

  	

  NE RESTAURANT COMPANY,

  INC.

  
	

   

  	

   

  
	

   

  	

  By:

  	

   

  
	

   

  	

   

  	

  Benjamin R. Jacobson,

  
	

   

  	

   

  	

  Chairman of the Board

  
	

   

  	

   

  
	

  STOCKHOLDER:

  	

  NAME AND ADDRESS OF

  STOCKHOLDER

  
	

   

  	

   

  
	

   

  	

   

  
	

   

  	

   

  
	

   

  	

   

  
	

   

  	

   

  
	

   

  	

   

  
	

   

  	

   

  
	

   

  	

  By:

  	

   

  
	

   

  	

   

  
	

   

  	

  Title:

  	

   

  
				

 

8

 

EXHIBIT

A

 

	

  Stockholder

  	

  Address

  

 

 

9SIXTH AMENDMENT

Exhibit

4.8

 

SIXTH

AMENDMENT

 

THIS SIXTH AMENDMENT dated as of January 2, 2002 (this “Amendment”)

amends the Second Amended and Restated Credit Agreement dated as of February 3,

1999 (as previously amended, the “Credit Agreement”) among U S Liquids Inc. (the

“Company”), various financial institutions (the “Banks”), Fleet National Bank,

as Syndication Agent, and Bank of America, N.A. (formerly known as Bank of

America National Trust and Savings Association), as administrative agent (in

such capacity, the “Administrative Agent”). 

Terms defined in the Credit Agreement are, unless otherwise defined

herein or the context otherwise requires, used herein as defined therein.

 

WHEREAS, the Company, the Banks and the Administrative Agent have

entered into the Credit Agreement; and

 

WHEREAS, the parties hereto desire to amend the Credit Agreement in

certain respects as more fully set forth herein;

 

NOW, THEREFORE, the parties hereto agree as follows:

 

SECTION 1  Amendments

Requiring the Consent of the Required Banks.  Subject to the satisfaction of the conditions precedent set forth

in Section 4(a), the Credit Agreement shall be amended as follows:

 

1.1           Addition of

Definitions.  The following new

definitions are added to Section 1.1 of the Credit Agreement in appropriate

alphabetical sequence:

 

Asset Sale Charges means any non-cash special

charges taken by the Company related to any sale of assets described in Section

5.5 of the Sixth Amendment to this Agreement.

 

Bonus Charges means up to $3,000,000 of non-cash special charges

taken by the Company related to the payment of employee bonuses in the form of

the Company’s capital stock.

 

FAS 142 Charges means non-cash charges taken by the Company

arising from the write-down of goodwill and other intangible assets pursuant to

Financial Accounting Standard No.142.

 

1.2           Amendments to

Definitions.

 

(a)           The definition of

“Adjusted EBITDA” is amended in its entirety to read as follows:

 

 

Adjusted EBITDA means, for any Computation Period, the total

of (i) EBITDA for such Computation Period plus (ii) any Detroit Facility

Reserve Charges taken during such Computation Period plus (iii) any Asset Sale

Charges taken during such Computation Period plus (iv) any FAS 142 Charges

taken during such Computation Period plus (v) any Bonus Charges taken during

such Computation Period minus (vi) any Recoveries received (or, in the case of

reversal of charges, taken) during such Computation Period.

 

 (b)          The definition of “Availability Amount” is amended in its

entirety to read as follows:

 

Availability Amount means the Commitment

Amount.

 

(c)           Subject to the approval by each Bank of

the amendment set forth in Section 2, the definition of “Commitment

Amount” is amended by deleting the reference to “$120,000,000” therein and

substituting “$100,000,000” therefor.

 

(d)           The definition of

“Net Worth” is amended in its entirety to read as follows:

 

Net Worth means,  at any time, the sum of (a) the Company’s consolidated stockholders’

equity (including preferred stock accounts) at such time period plus (b)

all Asset Sale Charges, Bonus Charges and FAS 142 Charges taken after June 1,

2001.

 

1.3           Amendment to

Section 4.3.  The introductory

clause of Section 4.3 is amended in its entirety to read as follows:

 

Each “Interest Period” for a Eurodollar Loan shall commence on the date

such Eurodollar Loan is made or converted from a Floating Rate Loan, or on the

expiration of the immediately preceding Interest Period for such Eurodollar

Loan, and shall end on the date which is one, two, three or six months thereafter

(or, in the case of an Interest Period which commences after February 1, 2002,

the date which is one month thereafter), as the Company may specify:.

 

1.4           Amendment to Section 6.1(b). Section 6.1(b) is

amended in its entirety to read as follows:

 

(b)           Commitment

Reductions.  Concurrently with the

receipt by the Company or any Subsidiary of any Net Cash Proceeds from any

Asset Sale, issuance of equity (other than any equity issued in connection with

the employee stock purchase plan of the Company) or issuance of Debt (other

than Debt permitted under Section 10.7(a), (b), (c), (d),

(e), (g) or (h)), the Commitment 

 

2

 

Amount shall be permanently reduced by an amount (rounded down, if

necessary, to an integral multiple of $100,000) equal to (A) 100% of all Net

Cash Proceeds from any Asset Sale and (B) 50% of all other such Net Cash

Proceeds; provided that the requirements of this clause (b) shall

not apply to any Net Cash Proceeds from any Asset Sale that are used to

purchase similar assets within 60 days after such Asset Sale.  All reductions of the Commitment Amount

pursuant this clause (b) shall reduce the Commitments pro rata among the

Banks according to their respective Percentages.

 

1.5           Amendment to

Section 10.6.2.  Section 10.6.2 is

amended in its entirety to read as follows:

 

10.6.2      Minimum Interest

Coverage.  Not permit the Interest

Coverage Ratio for any Computation Period to be less than the applicable ratio

set forth below:

 

	

  Computation

  	

   

  	

  Interest

  	

   

  
	

  Period Ending

  	

   

  	

  Coverage

  Ratio

  	

   

  
	

  12/31/01

  	

   

  	

  3.00 to 1.0

  	

   

  
	

  3/31/02 and thereafter

  	

   

  	

  3.50 to 1.0.

  	

   

  

 

1.6           Amendment to

Section 10.6.4.  Section 10.6.4 is

amended in its entirety to read as follows:

 

10.6.4      Capital

Expenditures.  Not permit the

aggregate amount of Capital Expenditures (excluding amounts, if any, paid to

consummate acquisitions permitted by Section 10.11(c) which constitute

Capital Expenditures) made by the Company and its Subsidiaries to exceed (a)

$11,000,000 from January 1, 2001 through December 31, 2001 or (b) $7,000,000

from January 1, 2002 through the Termination Date.

 

SECTION 2    Amendment Requiring the Consent of each

Bank. Subject to the satisfaction of the conditions precedent set forth in Section

4(b), the definition of “Termination Date” set forth in Section 1.1 is

amended in its entirety to read as follows:

 

Termination Date means the earlier to occur of (a) June 15,

2002; and (b) such other date on which the Commitments shall terminate pursuant

to Section 6 or Section 12.

 

SECTION 3            Representations

and Warranties.  The Company

represents and warrants to the Administrative Agent and the Banks that, after

giving effect to the effectiveness hereof, (a) each warranty set forth in

Section 9 (excluding Section 9.14 with respect to U S Liquids of 

 

3

 

Central Texas, L.L.C.) of the Credit Agreement is true and correct as

of the date of the execution and delivery of this Amendment by the Company,

with the same effect as if made on such date, and (b) no Event of Default or

Unmatured Event of Default exists.

 

SECTION 4            Effectiveness.  (a) The amendments set forth in Section 1

above shall become effective when the Administrative Agent shall have received

(i) counterparts of this Amendment executed by the Company and the Required

Banks, (ii) a Confirmation, substantially in the form of Exhibit A,

signed by the Company and each Subsidiary, and (iii) an amendment fee for each

Bank which, on or before January 2, 2002, executes and delivers to the

Administrative Agent a counterpart hereof agreeing to the amendments set forth

in Section 1, such fee to be in an amount equal to 0.05% of such Bank’s

Commitment after giving effect to the amendment in Section 1.2(b).

 

(b)           The amendment set

forth in Section 2 shall become effective when the Administrative Agent

shall have received (i) counterparts of this Amendment executed by the Company

and each Bank and (ii) an extension fee in the amount of $200,000 (to be shared

among the Banks pro rata according to their respective Commitments after giving

effect to the amendment in Section 1.2(b).

 

SECTION 5            Miscellaneous.

 

5.1           Continuing

Effectiveness, etc.  As herein

amended, the Credit Agreement shall remain in full force and effect and is

hereby ratified and confirmed in all respects. 

After the effectiveness of this Amendment, all references in the Credit

Agreement and the other Loan Documents to “Credit Agreement” or similar terms

shall refer to the Credit Agreement as amended hereby.

 

5.2           Counterparts. 

This Amendment may be executed in any number of counterparts and by the

different parties on separate counterparts, and each such counterpart shall be

deemed to be an original but all such counterparts shall together constitute

one and the same Amendment.

 

5.3           Governing Law. 

This Amendment shall be a contract made under and governed by the laws

of the State of Illinois applicable to contracts made and to be performed

entirely within such state.

 

5.4           Successors and Assigns.  This Amendment shall be binding upon the Company, the Banks and

the Administrative Agent and their respective successors and assigns, and shall

inure to the benefit of the Company, the Banks and the Administrative Agent and

the respective successors and assigns of the Banks and the Administrative

Agent.

 

5.5           Consent to Asset

Sales.  Notwithstanding any

provision of Section 10.11 of the Credit Agreement or Section 6.6 of the Fourth

Amendment to the Credit Agreement to the contrary, the Required Banks hereby

agree that the Company may sell all of the stock or all or a 

 

4

 

portion of the assets of any of the Subsidiaries listed on Schedule

10.9(d) of the Credit Agreement and any Specified Property so long as the Net

Cash Proceeds from any such sale are at least equal to the tangible book value

of such Subsidiary or assets, as applicable.

 

5.6           Pricing.  The Company and the Required Banks agree

that, notwithstanding any provision of the Credit Agreement to the contrary, (a) each of the Floating Rate Margin,

the Eurodollar Margin, the rate per annum for non–use fees and the rate

per annum for letter of credit fees for Financial Letters of Credit and Non–Financial

Letters of Credit, respectively, set forth in Schedule 1.1 of the Credit

Agreement (the “Pricing Schedule”) shall not be priced lower than the rates set

forth in Level II of the Pricing Schedule during the period from

February 1, 2002 through April 1, 2002 and (b) the Floating Rate Margin and the Eurodollar

Margin shall be increased by 0.25% on each of April 2, 2002 and May 1, 2002 for

each of Level I and Level II.

 

 

[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

 

5

 

Delivered at Chicago, Illinois, as of the day and year first above

written.

 

	

  U

  S LIQUIDS INC.

  
	

   

  
	

   

  
	

  By

  	

   

  
	

  Title

  	

   

  
	

   

  
	

   

  
	

  BANK

  OF AMERICA, N.A., as Administrative Agent

  
	

   

  
	

   

  
	

  By

  	

   

  
	

  Title

  	

   

  
	

   

  
	

   

  
	

  BANK

  OF AMERICA, N.A., as a Bank

  
	

   

  
	

   

  
	

  By

  	

   

  
	

  Title

  	

   

  
	

   

  
	

   

  
	

  FLEET

  NATIONAL BANK, as Syndication Agent and as a Bank

  
	

   

  
	

   

  
	

  By

  	

   

  
	

  Title

  	

   

  
	

   

  
	

   

  
	

  BANK

  ONE TEXAS, N.A.

  
	

   

  
	

   

  
	

  By

  	

   

  
	

  Title

  	

   

  

 

6

 

	

   

  
	

  THE BANK OF NOVA SCOTIA

  
	

   

  
	

   

  
	

  By

  	

   

  
	

  Title

  	

   

  
	

   

  
	

   

  
	

  UNION

  BANK OF CALIFORNIA

  
	

   

  
	

   

  
	

  By

  	

   

  
	

  Title

  	

   

  
	

   

  
	

   

  
	

  COMERICA

  BANK

  
	

   

  
	

   

  
	

  By

  	

   

  
	

  Title

  	

   

  
	

   

  
	

   

  
	

  WELLS FARGO BANK, N.A.

  
	

   

  
	

   

  
	

  By

  	

   

  
	

  Title

  	

   

  
	

   

  
	

   

  
	

  BNP PARIBAS

  
	

   

  
	

   

  
	

  By

  	

   

  
	

  Title

  	

   

  
	

   

  
	

   

  
	

  By

  	

   

  
	

  Title

  	

   

  

 

7

 

Exhibit A

 

CONFIRMATION

 

Dated as of January 2, 2002

 

To:           Bank of America, N.A.,

individually and as Agent, and the other financial institutions party to the

Credit Agreement referred to below

 

Please refer to (a) the

Second Amended and Restated Credit Agreement dated as of February 3, 1999 (as

amended, the “Credit Agreement”) among U S Liquids Inc., various financial

institutions (the “Banks”) and Bank of America, N.A. (formerly known as Bank of

America National Trust and Savings Association), as agent (the “Agent”); (b)

the other “Loan Documents” (as defined in the Credit Agreement), including the

Guaranty and the Security Agreement; and (c) the Sixth Amendment dated as of

January 2, 2002 to the Credit Agreement (the “Sixth Amendment”).

 

Each of the undersigned

hereby confirms to the Agent and the Banks that, after giving effect to the

Sixth Amendment and the transactions contemplated thereby, each Loan Document

to which such undersigned is a party continues in full force and effect and is

the legal, valid and binding obligation of such undersigned, enforceable

against such undersigned in accordance with its terms.

 

	

  U

  S LIQUIDS INC.

  	

   

  
	

   

  	

   

  
	

   

  	

   

  
	

  By:

  	

   

  	

   

  
	

  Name

  Printed:

  	

   

  	

   

  
	

  Title:

  	

   

  	

   

  
	

   

  	

   

  
	

  EARTH

  BLENDS, INC.

  	

   

  
	

  MBO,

  INC.

  	

   

  
	

  THE

  NATIONAL SOLVENT EXCHANGE CORP.

  	

   

  
	

  NORTHERN

  A-1 SANITATION SERVICES, INC.

  	

   

  
	

  PARALLEL

  PRODUCTS OF FLORIDA, INC.

  	

   

  
	

  PARALLEL

  PRODUCTS OF KENTUCKY, INC.

  	

   

  
	

  RE-CLAIM

  ENVIRONMENTAL LOUISIANA, L.L.C.

  	

   

  
	

  ROMIC ENVIRONMENTAL TECHNOLOGIES

  CORPORATION

  	

   

  
	

  USL

  FIRST SOURCE, INC.

  	

   

  
	

  U

  S LIQUIDS OF HOUSTON, L.L.C.

  	

   

  
	

  U

  S LIQUIDS OF DALLAS, L.L.C.

  	

   

  
	

  U

  S LIQUIDS OF CENTRAL TEXAS, L.L.C.

  	

   

  
					

 

A-1

 

	

  U

  S LIQUIDS OF CONNECTICUT, INC.

  	

   

  
	

  U

  S LIQUIDS OF GREATER CHICAGO, INC.

  	

   

  
	

  U

  S LIQUIDS OF PENNSYLVANIA, INC.

  	

   

  
	

  U

  S LIQUIDS OF TEXAS, INC.

  	

   

  
	

  U

  S LIQUIDS LP HOLDING CO.

  	

   

  
	

  U

  S LIQUIDS NORTHEAST, INC.

  	

   

  
	

  U

  S LIQUIDS TERMINAL SERVICES, INC.

  	

   

  
	

  U

  S LIQUIDS OF DETROIT, INC.

  	

   

  
	

  U

  S LIQUIDS OF FLORIDA, INC.

  	

   

  
	

  USL

  ENVIRONMENTAL SERVICES, INC.

  	

   

  
	

  USL

  GENERAL MANAGEMENT, INC.

  	

   

  
	

  USL

  PARALLEL PRODUCTS OF CALIFORNIA

  	

   

  
	

  WASTE

  RESEARCH AND RECOVERY, INC.

  	

   

  
	

  WASTE

  STREAM ENVIRONMENTAL, INC.

  	

   

  
	

   

  	

   

  
	

   

  	

   

  
	

  By:

  	

   

  	

   

  
	

  Name:

  	

   

  	

   

  
	

  Title:

  	

   

  	

   

  
	

   

  	

   

  
	

  U S LIQUIDS OF LA, L.P.

  	

   

  
	

   

  	

   

  
	

  By:  MBO, Inc., its General Partner

  	

   

  
	

   

  	

   

  
	

  By:

  	

   

  	

   

  
	

  Name:

  	

   

  	

   

  
	

  Title:

  	

   

  	

   

  
	

   

  	

   

  
	

  USL

  MANAGEMENT LIMITED PARTNERSHIP

  	

   

  
	

   

  	

   

  
	

  By:  USL General Management, Inc., its General

  Partner

  	

   

  
	

   

  	

   

  
	

  By:

  	

   

  	

   

  
	

  Name:

  	

   

  	

   

  
	

  Title:

  	

   

  	

   

  
	

   

  	

   

  
	

  GEM

  MANAGEMENT, INC.

  	

   

  
	

   

  	

   

  
	

  By:

  	

   

  	

   

  
	

  Name:

  	

   

  	

   

  
	

  Title:

  	

   

  	

   

  

 

 

 

A-2

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