EXHIBIT 4.18
AMENDED AND RESTATED
SECURED CREDIT AGREEMENT
among
TRANSOK, INC.,
as the Borrower,
and
CERTAIN FINANCIAL INSTITUTIONS,
as the Lenders,
and
BANK OF MONTREAL,
as Administrative Agent,
and
CANADIAN IMPERIAL BANK OF COMMERCE,
as Documentation Agent
Dated as of December 12, 1996
TABLE OF CONTENTS
Page
ARTICLE I DEFINITIONS............................................. 1
SECTION 1.1 Certain Defined Terms................................... 1
ARTICLE II COMMITMENTS OF THE LENDERS;
BORROWING PROCEDURES AND
CONDITIONS.............................................. 24
SECTION 2.1 Commitments............................................. 24
SECTION 2.1.1 Loan Commitment......................................... 24
SECTION 2.1.2 Letter of Credit Commitment............................. 24
SECTION 2.1.3 Lenders Not Permitted or Required to Make
Borrowings Available.................................... 25
SECTION 2.2 Domestic Loans and Eurodollar Loans..................... 25
SECTION 2.3 Borrowing Procedures.................................... 25
SECTION 2.3.1 Domestic Loans.......................................... 25
SECTION 2.3.2 Eurodollar Loans........................................ 26
SECTION 2.3.3 Letters of Credit....................................... 26
SECTION 2.4 Letter of Credit Procedures............................. 27
SECTION 2.4.1 Letter of Credit Operations............................. 27
SECTION 2.4.2 Borrower's Agreement to Repay Letter of Credit
Drawings................................................ 27
SECTION 2.4.3 Lenders' Agreement to Repay Letter of Credit
Drawings................................................ 29
SECTION 2.4.4 Procedures for Depositing Cash Collateral............... 30
SECTION 2.5 [Intentionally Omitted]................................. 30
SECTION 2.6 Increased Capital Costs................................. 30
SECTION 2.7 Extension of Scheduled Commitment Termination
Date, Initial Commitment Amortization Date and
Revolving Commitments................................... 31
ARTICLE III PROVISIONS RELATING TO THE NOTES
AND REPAYMENT........................................... 38
SECTION 3.1 The Notes............................................... 38
SECTION 3.2 Repayments.............................................. 38
SECTION 3.3 Due Date Extension...................................... 38
ARTICLE IV INTEREST, FEES AND SPECIAL
EURODOLLAR LOAN RELATED
PROVISIONS.............................................. 38
SECTION 4.1 Interest on the Borrowings.............................. 38
SECTION 4.1.1 Interest Prior to Maturity.............................. 38
TABLE OF CONTENTS
(CONTINUED)
PAGE
SECTION 4.1.2 Interest After Maturity................................. 39
SECTION 4.2 Notice of Eurodollar Interest Rate; Determination
Conclusive.............................................. 40
SECTION 4.3 Eurodollar Interest Periods............................. 40
SECTION 4.4 Commitment Fee; Other Fees.............................. 40
SECTION 4.5 Letter of Credit Fees................................... 41
SECTION 4.6 Payment of Interest; Calculation of Interest and
Fees.................................................... 41
SECTION 4.7 Eurodollar Deposits Unavailable or Eurodollar
Interest Rate Unascertainable........................... 42
SECTION 4.8 Changes in Law Rendering Eurodollar Lending
Unlawful................................................ 42
SECTION 4.9 Special Fees in Respect of Reserve Requirements......... 43
SECTION 4.10 Taxes................................................... 43
SECTION 4.11 Reasonable Efforts...................................... 44
SECTION 4.12 Increased Costs......................................... 44
SECTION 4.13 Discretion of the Lenders as to Manner of
Funding................................................. 45
SECTION 4.14 Eurodollar Loan-Related Indemnification Provisions...... 46
SECTION 4.15 Replacement of Lender on Account of Increased
Costs, Eurodollar Lending Unlawful, Reserve
Requirements, Taxes, Certain Dissents, etc.............. 46
SECTION 4.16 Maximum Interest........................................ 47
ARTICLE V REDUCTION OR TERMINATION OF THE
COMMITMENTS; PREPAYMENTS................................ 49
SECTION 5.1 Voluntary Reduction or Termination of the
Commitments............................................. 49
SECTION 5.2 Voluntary Prepayments................................... 49
SECTION 5.3 Mandatory Scheduled Reductions of the
Commitment Amount....................................... 49
SECTION 5.4 [Intentionally Omitted]................................. 50
SECTION 5.5 Mandatory Prepayments and Reduction of
Commitment Amount on Account of Asset
Transfers............................................... 50
SECTION 5.6 [Intentionally Omitted]................................. 50
SECTION 5.7 Mandatory Prepayments on Account of Loans and
Letters of Credit Exceeding Commitment
Amounts................................................. 50
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TABLE OF CONTENTS
(CONTINUED)
PAGE
ARTICLE VI CONVERSION OF LOANS BETWEEN
EURODOLLAR LOANS AND DOMESTIC
LOANS................................................... 51
ARTICLE VII MAKING AND PRORATION OF PAYMENTS;
OFFSET.................................................. 51
SECTION 7.1 Making of Payments...................................... 51
SECTION 7.2 Proration of Payments................................... 52
SECTION 7.3 Offset.................................................. 52
ARTICLE VIII REPRESENTATIONS AND WARRANTIES.......................... 52
SECTION 8.1 Organization, etc....................................... 52
SECTION 8.2 Authorization; No Conflict.............................. 53
SECTION 8.3 Validity and Binding Nature............................. 53
SECTION 8.4 Representation with Respect to Financial Statements..... 53
SECTION 8.5 Pending or Threatened Litigation and Contingent
Liabilities............................................. 54
SECTION 8.6 Existing Liens.......................................... 54
SECTION 8.7 Existing Subsidiaries................................... 55
SECTION 8.8 Existing Employee Benefit Plans......................... 55
SECTION 8.9 Investment Company Act Representation................... 55
SECTION 8.10 Public Utility Holding Company Act Representation....... 55
SECTION 8.11 Representation with Respect to Regulations G, T,
U and X................................................. 55
SECTION 8.12 Representation with Respect to True and Complete
Disclosure.............................................. 56
SECTION 8.13 Status of Title to Assets............................... 56
SECTION 8.14 Taxes................................................... 56
SECTION 8.15 Unconditional Purchase Obligations...................... 56
SECTION 8.16 Environmental Warranties................................ 56
SECTION 8.17 Regulatory Compliance................................... 59
ARTICLE IX BORROWER'S COVENANTS.................................... 59
SECTION 9.1 Reports, Certificates and Other Information............. 59
SECTION 9.1.1 Audit Report............................................ 60
SECTION 9.1.2 Interim Financial Reports............................... 60
SECTION 9.1.3 Compliance Certificates................................. 60
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TABLE OF CONTENTS
(CONTINUED)
PAGE
SECTION 9.1.4 Reports to SEC, Shareholders and Other
Regulatory Agencies..................................... 61
SECTION 9.1.5 Notices Relating to Default, Litigation and
Certain ERISA Matters................................... 61
SECTION 9.1.6 Changes in Material Subsidiaries........................ 62
SECTION 9.1.7 Projected Cash Flow Statements.......................... 62
SECTION 9.1.8 Other Information....................................... 62
SECTION 9.2 Affirmative Covenants................................... 62
SECTION 9.2.1 Books, Records and Inspections.......................... 62
SECTION 9.2.2 Insurance............................................... 62
SECTION 9.2.3 Taxes, Assessments, Etc................................. 62
SECTION 9.2.4 Maintenance of Employee Benefit Plans................... 63
SECTION 9.2.5 Use of Loan Proceeds and Letters of Credit.............. 63
SECTION 9.2.6 Title to Properties..................................... 63
SECTION 9.2.7 New or Activated Subsidiaries; Material Subsidiaries.... 63
SECTION 9.2.8 Environmental Covenant.................................. 63
SECTION 9.2.9 Compliance with Laws, etc............................... 64
SECTION 9.2.10 [Intentionally Omitted]................................. 64
SECTION 9.2.11 Indemnity............................................... 64
SECTION 9.3 Negative Covenants...................................... 64
SECTION 9.3.1 Restrictions on Redemption and Purchase of Securities
and Payment of Dividends................................ 64
SECTION 9.3.2 Stock Purchases......................................... 66
SECTION 9.3.3 Permitted Indebtedness.................................. 66
SECTION 9.3.4 Liens................................................... 68
SECTION 9.3.5 Guaranties, Loans, Advances or Investments.............. 69
SECTION 9.3.6 Restrictions on Fundamental Changes..................... 72
SECTION 9.3.7 Fiscal Year............................................. 73
SECTION 9.3.8 Transfer of Assets...................................... 73
SECTION 9.3.9 Unconditional Purchase Obligations...................... 75
SECTION 9.3.10 Other Agreements........................................ 75
SECTION 9.3.11 Business Activities..................................... 75
SECTION 9.3.12 Capital Expenditures, etc............................... 75
SECTION 9.3.13 Negative Pledges, Restrictive Agreements, etc........... 76
SECTION 9.3.14 [Intentionally Omitted]................................. 76
SECTION 9.3.15 Transactions with Affiliates............................ 76
SECTION 9.3.16 Restrictions on Decrease in Capital Stock............... 76
SECTION 9.3.17 [Intentionally Omitted]................................. 76
SECTION 9.3.18 Modifications of Certain Agreements..................... 76
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TABLE OF CONTENTS
(CONTINUED)
PAGE
SECTION 9.3.19 Receivables Financing................................... 76
SECTION 9.4 Financial Covenants..................................... 77
SECTION 9.4.1 Minimum Stockholders' Equity............................ 77
SECTION 9.4.2 EBITDA to Total Interest Expense........................ 77
SECTION 9.4.3 Funded Debt to Capitalization........................... 77
ARTICLE X COLLATERAL SECURITY..................................... 77
SECTION 10.1 Pledge Agreement........................................ 77
SECTION 10.2 Partnership/Limited Liability Company Security
Agreement............................................... 78
SECTION 10.3 Guaranties.............................................. 78
SECTION 10.4 Notes Security Agreement................................ 78
SECTION 10.5 Guaranty of the Holding Company......................... 78
ARTICLE XI CONDITIONS TO BORROWING................................. 79
SECTION 11.1 Conditions Precedent to Initial Borrowing............... 79
SECTION 11.1.1 Executed Original Notes................................. 79
SECTION 11.1.2 Certificate of Officers of the Borrower and
Certain Subsidiaries.................................... 79
SECTION 11.1.3 Consents, etc........................................... 79
SECTION 11.1.4 Opinion of Counsel for the Borrower..................... 80
SECTION 11.1.5 [Intentionally Omitted]................................. 80
SECTION 11.1.6 The Pledge Agreement.................................... 80
SECTION 11.1.7 [Intentionally Omitted]................................. 80
SECTION 11.1.8 Guaranties.............................................. 80
SECTION 11.1.11 Notes Security Agreement................................ 80
SECTION 11.1.12 Partnership/Limited Liability Company Security
Agreement............................................... 80
SECTION 11.1.13 Holding Company......................................... 81
SECTION 11.1.14 [Intentionally Omitted]................................. 81
SECTION 11.1.15 [Intentionally Omitted]. .............................. 81
SECTION 11.1.16 Financial Statements.................................... 81
SECTION 11.1.17 Other Documents......................................... 81
SECTION 11.2 Other Conditions Precedent to Making Initial
Borrowing............................................... 81
SECTION 11.2.1 Fees.................................................... 81
SECTION 11.2.2 Purchase of A-Notes and B-Notes......................... 81
SECTION 11.2.3 [Intentionally Omitted]................................. 81
SECTION 11.2.4 [Intentionally Omitted]................................. 81
SECTION 11.2.5 [Intentionally Omitted]................................. 81
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TABLE OF CONTENTS
(CONTINUED)
PAGE
SECTION 11.3 All Borrowings.......................................... 81
SECTION 11.3.1 No Default; Warranties True and Correct................. 81
ARTICLE XII EVENTS OF DEFAULT AND THEIR EFFECT...................... 82
SECTION 12.1 Events of Default....................................... 82
SECTION 12.1.1 Non-Payment of the Loans, Letter of Credit
Obligations, Fees or Other Amounts...................... 82
SECTION 12.1.2 Non-Payment of Other Indebtedness for
Borrowed Money.......................................... 82
SECTION 12.1.3 Lease................................................... 82
SECTION 12.1.4 Bankruptcy, Insolvency, etc............................. 83
SECTION 12.1.5 Non-Performance of Certain Covenants and
Obligations............................................. 83
SECTION 12.1.6 Non-Performance of Other Covenants and
Obligations............................................. 83
SECTION 12.1.7 Breach of Warranties and Misleading Statements.......... 83
SECTION 12.1.8 Change in Ownership..................................... 84
SECTION 12.1.9 Judgments............................................... 84
SECTION 12.1.10 Employee Benefit Plans.................................. 85
SECTION 12.1.11 Lien or Guaranty Failure................................ 85
SECTION 12.1.12 Default Under Any Security Document..................... 85
SECTION 12.1.13 [Intentionally Omitted]................................. 85
SECTION 12.1.14 [Intentionally Omitted]................................. 85
SECTION 12.1.15 [Intentionally Omitted]................................. 85
SECTION 12.1.16 Non-Payment of Other Indebtedness for
Borrowed Money by the Parent Company.................... 85
SECTION 12.2 Effect of Event of Default.............................. 85
SECTION 12.3 Cash Collateralization of Letters of Credit Upon
Event of Default........................................ 86
ARTICLE XIII THE ADMINISTRATIVE AGENT,
DOCUMENTATION AGENT AND ISSUING
BANK.................................................... 86
SECTION 13.1 Authorization........................................... 86
SECTION 13.2 Power................................................... 87
SECTION 13.3 Indemnification of the Administrative Agent, the
Documentation Agent or the Issuing Bank................. 87
SECTION 13.4 Action on Instructions of the Required Lenders.......... 88
SECTION 13.5 Exculpation............................................. 88
SECTION 13.6 Employment of Counsel, etc.............................. 89
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TABLE OF CONTENTS
(CONTINUED)
PAGE
SECTION 13.7 Reliance on Documents................................... 89
SECTION 13.8 Credit Investigation.................................... 89
SECTION 13.9 Resignation............................................. 89
SECTION 13.10 Annual Administrative Agency Fees....................... 90
SECTION 13.11 The Administrative Agent, Issuing Bank and
Documentation Agent as Lenders.......................... 90
ARTICLE XIV MISCELLANEOUS PROVISIONS................................ 90
SECTION 14.1 No Waiver............................................... 90
SECTION 14.2 Amendments, Modifications, Waivers and Consents......... 90
SECTION 14.3 Confirmations........................................... 91
SECTION 14.4 Notices, Demands, Instructions and Other
Communications.......................................... 91
SECTION 14.5 Accounting Terms and Computations....................... 92
SECTION 14.6 Sales and Transfers, etc., of Borrowings and
Notes; Participations in Borrowings and Notes........... 92
SECTION 14.7 Payment of Costs, Expenses and Taxes.................... 97
SECTION 14.8 INDEMNIFICATION PROVISIONS.............................. 97
SECTION 14.9 Subsidiary References................................... 98
SECTION 14.10 Section Captions and Table of Contents.................. 98
SECTION 14.11 Governing Law........................................... 98
SECTION 14.12 Execution in Counterparts............................... 99
SECTION 14.13 Successors and Assigns.................................. 99
SECTION 14.14 Waiver of Jury Trial.................................... 99
SECTION 14.15 Forum Selection and Consent to Jurisdiction............. 99
SECTION 14.16 Severability............................................100
SECTION 14.17 Confidentiality.........................................100
SECTION 14.18 Release of Parent Company Guaranty......................101
SECTION 14.19 Notice..................................................101
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LIST OF SCHEDULES AND EXHIBITS TO SECURED CREDIT AGREEMENT
SCHEDULE I Address, Telex, TWX, Telephone and Telecopier Numbers
SCHEDULE II Percentages, Original Designated Maximum Commitments, Etc.
EXHIBIT 2.3 Form of Borrowing Request
EXHIBIT 2.3.3A Form of Issuance Request
EXHIBIT 2.7 Form of Annual Certificate of Extension
EXHIBIT 3.1 Form of Note
EXHIBIT 8.5 Pending Litigation
EXHIBIT 8.6 Existing Liens
EXHIBIT 8.7 Existing Subsidiaries and Material Subsidiaries
EXHIBIT 8.14 Taxes
EXHIBIT 8.16 Environmental Matters
EXHIBIT 8.17 Regulatory Compliance
EXHIBIT 9.1.3A Form of Annual Compliance Certificate
EXHIBIT 9.1.3B Form of Quarterly Compliance Certificate
EXHIBIT 9.3.3 Form of RSN
EXHIBIT 9.3.3(xv) Subordination Provisions
EXHIBIT 9.3.5(xxiv) Existing Equity Investments
EXHIBIT 9.3.9 Unconditional Purchase Obligations
EXHIBIT 10.1A Form of Pledge Agreement from Borrower
EXHIBIT 10.1B Form of Pledge Agreement from Subsidiary
EXHIBIT 10.2 Form of Partnership/Limited Liability Company Security
Agreement
EXHIBIT 10.3 Form of Guaranty
EXHIBIT 10.4A Form of Notes Security Agreement
EXHIBIT 10.4B Form of Intercompany Subordinated Demand Note
EXHIBIT 11.1.4 Form of Opinion of Counsel for the Borrower
EXHIBIT 11.1.6 Form of Acknowledgement and Reaffirmation of Pledge
Agreement
EXHIBIT 11.1.8 Guarantors
EXHIBIT 11.1.8A Form of Consent, Acknowledgement and Agreement of
Guarantors
EXHIBIT 11.1.8B Form of Consent, Acknowledgement and Agreement of Tejas
Transok Holding Company
EXHIBIT 11.1.9 Form of Certificate of Financial Condition
EXHIBIT 11.1.10 Form of Subordination Agreement
EXHIBIT 11.1.10A Form of Acknowledgement and Reaffirmation of Subordination
Agreement
EXHIBIT 11.1.11 Form of First Amendment to Notes Security Agreement
EXHIBIT 11.1.12 Form of Acknowledgement and Reaffirmation of
Partnership/Limited Liability Company Pledge Agreement
EXHIBIT 11.1.13 Form of Acknowledgement and Reaffirmation of Holding
Company
Security Agreement.
EXHIBIT 14.6 Form of Assignment and Acceptance Agreement
AMENDED AND RESTATED SECURED CREDIT AGREEMENT
THIS AMENDED AND RESTATED SECURED CREDIT AGREEMENT, dated as of
December 12, 1996 (as may be amended, modified, supplemented, renewed, extended
or restated from time to time, this "AGREEMENT"), among TRANSOK, INC., an
Oklahoma corporation (the "BORROWER"), the various financial institutions as are
or may become parties hereto (collectively the "LENDERS"), BANK OF MONTREAL,
acting through certain of its U.S. branches or agencies ("BMO"), as
administrative agent (in such capacity, together with any successor(s) thereto
in such capacity, the "ADMINISTRATIVE AGENT") and CANADIAN IMPERIAL BANK OF
COMMERCE, acting through certain of its U.S. branches or agencies ("CIBC"), as
documentation agent (in such capacity, together with any successor(s) thereto in
such capacity (the "DOCUMENTATION AGENT").
W I T N E S S E T H:
WHEREAS, Transok Acquisition Company, a Delaware corporation ("TAC"), the
Lenders, the Administrative Agent and the Documentation Agent have heretofore
entered into a Secured Credit Agreement, dated as of June 6, 1996 (herein called
the "ORIGINAL CREDIT AGREEMENT"); and
WHEREAS, TAC has merged with and into the Borrower and the Borrower is the
surviving corporation;
WHEREAS, the Borrower, the Lenders, the Administrative Agent and the
Documentation Agent now desire to amend and restate the Original Credit
Agreement in its entirety as hereinafter set forth;
NOW, THEREFORE, in consideration of the premises and of the mutual
covenants herein contained, the parties hereto agree as follows:
ARTICLE I
DEFINITIONS
SECTION 1.1 CERTAIN DEFINED TERMS. Unless otherwise defined herein or in
such other agreements, as used in this Agreement, the Notes (as hereinafter
defined), or any other agreement, document, statement, instrument or transaction
contemplated thereby or relating thereto, and all amendments, extensions,
modifications, renewals, supplements or waivers thereof or thereto, the
following terms shall have the following meanings, which meanings shall be
equally applicable to both the singular and plural form of such terms:
A-NOTES - shall mean all of the Series A Notes issued and, unless
otherwise specified or the context otherwise requires, outstanding under the
Loan Agreement (as defined in the Participation Agreement).
ACCEPTING LENDERS - shall have the meaning assigned to such term in
SECTION 2.7(B).
ACADIAN - shall mean Acadian Gas Corporation, a Nevada corporation.
ACTIVATION - shall mean, with respect to any Subsidiary of the Borrower,
the transformation of such entity from a passive legal entity existing for a
purpose such as holding a royalty or similar interest and receiving payments
thereunder to an entity engaged in business or commercial activities of any type
or otherwise engaged in activities other than the holding of such interest and
the receipt of payments thereunder.
ADDITIONAL RENT - shall have the meaning set forth in the Lease.
ADJUSTED STOCKHOLDER'S EQUITY - shall mean, as of the time any
determination thereof is to be made, the positive sum, if any, of (i)
Stockholder's Equity PLUS (ii) all Indebtedness of the Borrower outstanding
under the RSNs MINUS (iii) all outstanding Indebtedness of the Borrower to the
Parent Company to the extent the Parent Company's source of funds for such
Indebtedness is unsecured credit lines which by their terms require borrowing
availability to be maintained under this Agreement to the extent of any
outstanding Indebtedness under such unsecured credit lines.
ADMINISTRATIVE AGENT - is defined in the PREAMBLE.
AFFILIATE - of any Person shall mean any other Person which, directly or
indirectly, controls, is controlled by or is under common control with such
Person (excluding any trustee under, or any committee with responsibility for
administering, any employee benefit plan). A Person shall be deemed to be
"controlled by" any other Person if such other Person possesses, directly or
indirectly, power (a) to vote 10% or more of the securities (on a fully diluted
basis) having ordinary voting power for the election of directors or managing
general partners; or (b) to direct or cause the direction of the management and
policies of such Person whether by contract or otherwise.
AGENT - shall mean either the Administrative Agent, the Collateral Agent
or the Documentation Agent, or any combination of the foregoing, as the case may
be.
AGGREGATE DISTRIBUTIONS AND INVESTMENTS - shall mean at the time any
determination thereof is to be made, the sum of (i) all Distributions made in
accordance with SECTION 9.3.1(I), (ii) the aggregate amount of all Equity
Investments in excess of $35,000,000 in the aggregate made in accordance with
SECTION 9.3.5(XIX), (iii) loans made and not repaid pursuant to SECTION
9.3.5(XVIII) to the Parent Company in excess of $100,000,000, made on or after
June 6, 1996 and to and including the date of such determination; and (iv) loans
made and not repaid pursuant to SECTION 9.3.5(XVII)(D) to any Subsidiary of the
Borrower that is not a Material Subsidiary in excess of $35,000,000 in the
aggregate.
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AGGREGATE REVOLVING OUTSTANDINGS - shall mean, at any time, the sum of (i)
the aggregate principal amount of all Loans outstanding at such time PLUS (ii)
the aggregate amount of all Letter of Credit Liabilities outstanding at such
time.
AGREEMENT - is defined in the PREAMBLE.
ALTERNATE BASE RATE - shall mean:
(a) on any date and with respect to all Domestic Loans other than
those dates and Loans described in CLAUSE (B) of this
definition, a fluctuating rate of interest per annum equal to
the higher of:
(i) the Base Rate, and
(ii) the Federal Funds Rate most recently determined by the
Administrative Agent PLUS 1% per annum; or
(b) on any date occurring during any Overnight Funds Period, but
with respect only to Domestic Loans made or Eurodollar Loans
converted into Domestic Loans during such Overnight Funds
Period, the Overnight Funds Rate.
The Alternate Base Rate is not necessarily intended to be the lowest rate of
interest determined by the Administrative Agent in connection with extensions of
credit. Changes in the rate of interest on that portion of any Loans maintained
as Domestic Loans shall take effect simultaneously with each change in the
Alternate Base Rate. The Administrative Agent shall give notice promptly to the
Borrower and the Lenders of changes in the Alternate Base Rate.
ANNIVERSARY DATE - shall mean any December 31, with the first such date
being December 31, 1997.
ANNUAL CERTIFICATE OF EXTENSION - shall mean any certificate of extension
duly executed by an authorized officer of the Borrower, substantially in the
form of EXHIBIT 2.7.
APPLICABLE DEFAULT MARGIN - shall mean two percent (2%) per annum.
APPLICABLE MARGIN - shall mean either the Applicable Margin for Loans or
the Applicable Margin for Letters of Credit, as the case may be.
APPLICABLE MARGIN FOR LETTERS OF CREDIT - shall mean with respect to the
letter of credit fee described in SECTION 4.5(A) at such times and from time to
time as the relevant Leverage Ratio is in one of the following ranges, the
percentage per annum set forth opposite such Leverage Ratio:
3
LEVERAGE RATIO PERCENTAGE
Range 1: Equal to or greater than 65% 1.250%
Range 2: Less than 65% but
equal to or greater than 60% 0.875%
Range 3: Less than 60% but
equal to or greater than 55% 0.750%
Range 4: Less than 55% but
equal to or greater than 50% 0.625%
Range 5: Less than 50% 0.500%
PROVIDED, HOWEVER that during the period from the Effective Date through and
including December 30, 1997, at such times and from time to time as the Leverage
Ratio is in Range 2, 3, 4 or 5 as indicated above, the minimum Applicable Margin
for Letters of Credit shall be 1.000%, unless the ratio of EBITDA to Total
Interest Expense calculated on June 30, 1997 or at any time thereafter in
accordance with SECTION 9.4.2 is at least 2.50:1, in which case the Applicable
Margin for Letters of Credit shall be calculated in accordance with the Leverage
Ratio table above.
APPLICABLE MARGIN FOR LOANS - shall mean with respect to Loans, at such
times and from time to time as the Leverage Ratio is in one of the following
ranges, the percentages per annum set forth opposite such Leverage Ratio under
the heading for the relevant type of Loan:
PERCENTAGE
LEVERAGE RATIO DOMESTIC LOAN EURODOLLAR LOAN
Range 1: Equal to or greater than 65% 0.250% 1.250%
Range 2: Less than 65% and
equal to or greater than 60% 0% 0.875%
Range 3: Less than 60% and
equal to or greater than 55% 0% 0.750%
Range 4: Less than 55% and
equal to or greater than 50% 0% 0.625%
Range 5: Less than 50% 0% 0.500%
PROVIDED, HOWEVER that during the period from the Effective Date through and
including December 30, 1997, at such times and from time to time as the Leverage
Ratio is in Range 2, 3, 4 or 5 as indicated above, the minimum Applicable Margin
for Loans with respect to Eurodollar Loans shall be 1.000%, unless the ratio of
EBITDA to Total Interest Expense calculated on June 30, 1997 or at any time
thereafter in accordance with SECTION 9.4.2 is at least 2.50:1, in which case
the Applicable Margin for Loans with respect to Eurodollar Loans shall be
calculated in accordance with the Leverage Ratio table above.
4
ASSET - shall mean, as to the Borrower and its Subsidiaries, all property
of any kind, name or nature, real or personal, tangible or intangible, legal or
equitable, whether now owned or hereafter acquired, including, without
limitation, money, stock, contract rights, franchises, value as a going concern,
causes of action, undivided fractional ownership interests, and anything of any
value which can be made available for, or may be appropriated to, the payment of
debts.
ASSIGNMENT AND ACCEPTANCE - shall mean an Assignment and Acceptance
Agreement substantially in the form of EXHIBIT 14.6.
B-NOTES - shall mean the Series B Notes issued and, unless specified or
the context otherwise requires, outstanding under the Loan Agreement (as defined
in the Participation Agreement).
BASE RATE - shall mean, at any time, the rate per annum then most recently
announced by the Administrative Agent at Chicago, Illinois, as its base rate for
Dollar loans in the United States, which base rate may not be the lowest rate
charged by the Administrative Agent on loans to any of its customers.
BMO - is defined in the PREAMBLE.
BORROWER - is defined in the PREAMBLE.
BORROWING - shall mean any extension of credit (as opposed to any
continuation or conversion thereof) made by the Lenders by way of Letters of
Credit or Loans.
BORROWING REQUEST - shall mean a request for a Borrowing and certificate
duly executed by the Borrower substantially in the form of EXHIBIT 2.3.
BUSINESS DAY - shall mean a day which is both a Domestic Business Day and
a Eurodollar Business Day.
CAPITAL EXPENDITURES - shall mean, for any period, the sum, without
duplication, of (i) all expenditures of the Borrower and its Subsidiaries
(including all expenditures incurred by the Lessee pursuant to the Lease) for
fixed or capital assets (except for purchases of natural gas classified as
property, plant and equipment) made during such period which, in accordance with
GAAP, would be classified as capital expenditures, and (ii) all Capitalized
Lease Obligations incurred during such period.
CAPITALIZATION - shall mean the sum, at the time outstanding and without
duplication, of (i) Funded Debt plus (ii) Stockholders' Equity plus (iii)
Operating Lessor's Debt.
CAPITALIZED LEASE OBLIGATIONS - shall mean all monetary obligations of the
Borrower or any of its Subsidiaries under any leasing or similar arrangement
which, in accordance with GAAP, would be classified as capitalized leases, and,
for purposes of this Agreement and each
5
other Loan Document, the amount of such obligations shall be the capitalized
amount thereof, determined in accordance with GAAP.
CERCLA - shall mean the Comprehensive Environmental Response, Compensation
and Liability Act of 1980, as amended.
CERCLIS - shall mean the Comprehensive Environmental Response Compensation
Liability Information System List.
CIBC - is defined in the PREAMBLE.
CODE - shall mean the Internal Revenue Code of 1986, as amended, and the
laws promulgated or issued from time to time thereunder.
CLOSING DATE - shall mean the date of this Agreement.
COLLATERAL AGENT - shall mean BMO, in its capacity as collateral agent
under the Security Documents, together with its successors in such capacity.
COMMITMENT - shall mean, as the context may require, a Letter of Credit
Commitment, Loan Commitment or Revolving Commitment.
COMMITMENT AMOUNT - shall mean, on any date, the Total Committed Amount as
such amount may be reduced from time to time pursuant to SECTIONS 5.1, 5.3, or
5.5; provided in no event shall the Commitment Amount exceed the Total Committed
Amount.
COMMITMENT FEE RATE - shall mean, at such times and from time to time as
the Leverage Ratio is in one of the following ranges, the percentage per annum
set forth opposite such Leverage Ratio:
LEVERAGE RATIO PERCENTAGE
Equal to or greater than 0.375%
50%
Less than 50% 0.250%
COMMITMENT TERMINATION DATE - shall mean the earliest of:
(a) the Scheduled Commitment Termination Date;
(b) the date on which all of the Commitments are terminated in
full or the Commitment Amount is reduced to zero pursuant to
SECTIONS 5.1, 5.3, or 5.5; and
6
(c) the earlier of the date of either
(i) the occurrence of any Event of Default described in
SECTION 12.1.4; or
(ii) the occurrence and continuance of any other Event of
Default and either (1) the declaration of the Loans to
be due and payable pursuant to SECTION 12.2, or (2) in
the absence of such declaration, the giving of notice by
the Administrative Agent to the Borrower that the
Commitments have been terminated pursuant to SECTION
12.2.
CONSOLIDATED NET INCOME - shall mean, for any period, the consolidated net
income (or loss) of the Borrower and its Subsidiaries for such period determined
on a consolidated basis in accordance with GAAP; PROVIDED that there shall be
excluded therefrom all non-cash gains and losses which would be classified as
extraordinary under GAAP.
CONSOLIDATED STOCKHOLDERS' EQUITY - shall mean, with respect to any Person
as of the time any determination thereof is to be made, (a) with respect to any
Person that is a corporation, the sum of such Person's capital stock (which
shall exclude, except in the case of the Parent Company, treasury stock and any
capital stock subject to mandatory redemption by the issuer at the option of the
holder thereof) and additional paid-in capital, PLUS retained earnings (MINUS
accumulated deficit), (b) with respect to any Person that is a partnership, the
aggregate of the capital accounts of all partners of such partnership, and (c)
with respect to any Person that is a limited liability company, the aggregate of
all membership interests of all members of such limited liability company.
CONTINGENT LIABILITY - shall mean any agreement, undertaking or
arrangement by which any Person guarantees, endorses or otherwise becomes or is
contingently liable upon (by direct or indirect agreement, contingent or
otherwise, to provide funds for payment, to supply funds to, or otherwise to
invest in, a debtor, or otherwise to assure a creditor against loss) the
Indebtedness, obligation or any other liability of any other Person (other than
by endorsements of instruments in the course of collection), or guarantees the
payment of dividends or other distributions upon the shares of or interests in
any other Person. The amount of any Person's obligation under any Contingent
Liability shall (subject to any limitation set forth therein) be deemed to be
the outstanding principal amount (or maximum principal amount, if larger) of the
Indebtedness, obligation or other liability guaranteed thereby or, if
applicable, such lesser principal amount as is expressly stated to be the
maximum principal amount of such Person's obligation thereunder.
DECLINING LENDER - shall have the meaning assigned to such term in SECTION
2.7(C).
DESIGNATED MAXIMUM COMMITMENT - shall mean at any time, as to any Lender,
the lesser of (i) such Lender's Original Designated Maximum Commitment and (ii)
from and after the Election Effective Date, the amount specified by such Lender
in the most recent notice provided
7
by such Lender pursuant to SECTION 2.7(A) and resulting from the Borrower's
election in SECTION 2.7(C).
DISTRIBUTION - shall have the meaning assigned to such term in SECTION
9.3.1.
DOLLARS (and the symbol "$") - shall mean lawful money of the United
States.
DOMESTIC BUSINESS DAY - shall mean a day on which banks are open for
business in Xxxxxxx, Xxxxx, Xxx Xxxx Xxxx, Xxx Xxxx and Chicago, Illinois.
DOMESTIC LOAN - shall mean a Loan bearing an interest rate determined with
reference to the Alternate Base Rate.
EBITDA - shall mean, with respect to any period for which a determination
thereof is to be made, the sum of (i) gross profit (revenues less cost of
sales), MINUS (ii) operating expenses (excluding any Fixed Rent or amortization
of deferred costs associated with such Fixed Rent), MINUS (iii) general and
administrative expenses, PLUS (iv) cash equity earnings of any unconsolidated
Subsidiary of the Borrower or any partnership or joint venture in which the
Borrower or any of its Subsidiaries has an equity interest and actually paid to
the Borrower and its Subsidiaries, all as determined on a consolidated basis for
the Borrower and its Subsidiaries in accordance with GAAP.
EFFECTIVE DATE - shall mean the first Business Day to occur on which all
conditions to the effectiveness of this Agreement set forth in ARTICLE XI have
been satisfied or waived by all Lenders, which will be in no event later than
December 31, 1996.
ELECTION EFFECTIVE DATE - shall mean the date specified in the Election
Notice as the date on which Commitments of any of the Lenders are to terminate
or reduce as a result of the Borrower's election in SECTION 2.7(C) or such later
date as selected by the Borrower in an amended Election Notice, and which date
shall be on or before the Initial Commitment Amortization Date of the year in
which such Election Notice or amended Election Notice is given, or if no
Election Notice is provided pursuant to the terms of SECTION 2.7, the Initial
Commitment Amortization Date.
ELECTION NOTICE - shall have the meaning assigned to such term in SECTION
2.7(C).
ENVIRONMENTAL LAWS - shall mean all applicable federal, state or local
statutes, laws, ordinances, codes, rules, regulations and guidelines (including
consent decrees and administrative orders) relating to public health and safety
and protection of the environment.
EQUITY INVESTMENT - shall mean, relative to any Person, any ownership or
similar interest held by such Person in any other Person. The amount of any
Equity Investment shall be the original capital amount thereof less all returns
of equity thereon (and without adjustment by reason of the financial condition
of such other Person) and shall, if made by the transfer or
8
exchange of property other than cash, be deemed to have been made in an original
capital amount equal to the Fair Market Value of such property.
ERISA - shall mean the Employee Retirement Income Security Act of 1974, as
amended, and any successor statute of similar import, together with the
regulations thereunder, in each case as in effect from time to time.
EUROCURRENCY RESERVE PERCENTAGE - shall mean, with respect to each
Eurodollar Interest Period, a percentage (expressed as a decimal) equal to the
daily average during such Eurodollar Interest Period of the percentages in
effect on each day of such Eurodollar Interest Period, if any, as prescribed by
the Board of Governors of the Federal Reserve System (or any successor thereto),
for determining the maximum reserve requirements applicable to "Eurocurrency
Liabilities" pursuant to Regulation D of the Board of Governors of the Federal
Reserve System or any other then applicable regulation of the Board of Governors
which prescribes reserve requirements applicable to "Eurocurrency Liabilities"
as presently defined in Regulation D.
EURODOLLAR BUSINESS DAY - shall mean a day on which dealings are carried
on in the interbank Eurodollar market and on which banks are open for business
in Xxxxxxx, Xxxxx, Xxx Xxxx Xxxx, Xxx Xxxx and Chicago, Illinois.
EURODOLLAR INTEREST PAYMENT DATE - shall have the meaning assigned to such
term in SECTION 4.6.
EURODOLLAR INTEREST PERIOD - shall mean, as to each Eurodollar Loan, the
period commencing on (and including) the latest Eurodollar Period Commencement
Date with respect to such Eurodollar Loan and ending on (but excluding) the day
numerically corresponding to such date one (1) month, two (2), three (3), or six
(6) months, or, if available from all the Lenders, twelve (12) months,
thereafter, as selected by the Borrower in the relevant notice pursuant to
SECTION 2.3; PROVIDED, HOWEVER, that:
(a) absent such selection, the Borrower shall be deemed to have
selected a Eurodollar Interest Period of one month or such
other duration as shall be required in order to comply with
the provisions of this definition;
(b) there shall not be more than fifteen (15) Eurodollar Interest
Payment Dates in effect at any one time for all Loans;
(c) any Eurodollar Interest Period which would otherwise end on a
day which is not a Eurodollar Business Day shall continue to
and end on the next succeeding Eurodollar Business Day, unless
the result would be that such Eurodollar Interest Period would
be extended to the next succeeding calendar month in which
case such Eurodollar Interest Period shall end on the next
preceding Eurodollar Business Day;
9
(d) if there exists no numerically corresponding day in such
month, such Eurodollar Interest Period shall end on the last
Eurodollar Business Day of such month; and
(e) no Eurodollar Interest Period shall end later than the
Scheduled Commitment Termination Date.
EURODOLLAR INTEREST RATE - shall mean, with respect to each Eurodollar
Loan for any Eurodollar Interest Period, a rate per annum (rounded upwards, if
necessary, to the nearest integral multiple of the number of decimal points
displayed on Telerate Page 3750, or any successor or similar service, or if
neither such Telerate Page 3750 nor any successor or similar service is
available and such rate is determined using Reference Lenders, one one-hundredth
of one percent (1/100%)), equal to (i) the average of the offered quotations
appearing on Telerate Page 3750 (or if such Telerate Page shall not be
available, any successor or similar service as may be selected by the Agents and
the Borrower) as of 11:00 a.m., London time (or as soon thereafter as
practicable), two (2) Eurodollar Business Days prior to the beginning of such
Eurodollar Interest Period, and (ii) if neither such Telerate Page 3750 nor any
successor or similar service is available, then the quotient of (x) the
arithmetic average of the quotation by each Reference Lender (notified to the
Administrative Agent by such Reference Lender) of the rate of interest per annum
at which deposits in Dollars in immediately available funds are offered to such
Reference Lender two (2) Eurodollar Business Days prior to the beginning of such
Eurodollar Interest Period by prime banks in the interbank Eurodollar market as
at or about 9:00 a.m., Chicago time, for delivery on the first day of such
Eurodollar Interest Period, in each case for a period equal to such Eurodollar
Interest Period and in an amount equal to the proposed Eurodollar Loan of such
Reference Lender to which such Eurodollar Interest Period relates, divided by
(y) the remainder of one (1) minus the decimal equivalent of the applicable
Eurocurrency Reserve Percentage. If on any occasion any Reference Lender is
unable, or for any reason fails, so to notify the Administrative Agent by 10:00
a.m., Chicago time, two (2) Eurodollar Business Days before the first day of
such Eurodollar Interest Period, the applicable Eurodollar Interest Rate shall
be determined on the basis of each quotation furnished by those of the Reference
Lenders which so notify the Administrative Agent at or prior to said 10:00 a.m.
EURODOLLAR LOAN - shall mean a Loan bearing an interest rate determined
with reference to the Eurodollar Interest Rate.
EURODOLLAR OFFICE - shall have the meaning set forth in SECTION 4.12.
EURODOLLAR PERIOD COMMENCEMENT DATE - shall mean, with respect to each
Eurodollar Loan, the date on which such Eurodollar Loan is made or the date on
which such Eurodollar Loan is converted from a Domestic Loan to a Eurodollar
Loan pursuant to the provisions of ARTICLE VI, and thereafter each date on which
such Eurodollar Loan is continued as a Eurodollar Loan pursuant to the
provisions of SECTION 4.3.
EVENT OF DEFAULT - shall mean any event described in SECTION 12.1.
10
FAIR MARKET VALUE - shall mean (i) with respect to any Asset (other than
cash) the price at which a willing buyer would buy and a willing seller would
sell, such Asset in an arms' length transaction, and (ii) with respect to cash,
the amount of such cash.
FEDERAL FUNDS RATE - shall mean, for any period, a fluctuating interest
rate per annum equal for each day during such period to:
(a) the weighted average of the rates on overnight Federal funds
transactions with members of the Federal Reserve System
arranged by Federal funds brokers, as published for such day
(or, if such day is not a Domestic Business Day, for the next
preceding Domestic Business Day) by the Federal Reserve Bank
of New York; or
(b) if such rate is not so published for any day which is a
Domestic Business Day, the average of the quotations for such
day on such transactions received by the Administrative Agent
from two Federal funds brokers of recognized standing selected
by it.
FIXED RENT - shall have the meaning provided in the Lease.
FUNDED DEBT - shall mean on a consolidated basis for the Borrower and its
Subsidiaries at any time a determination thereof is to be made, the sum without
duplication of: (a) indebtedness for borrowed money, all obligations evidenced
by bonds, debentures, notes or other similar instruments, and purchase money
obligations which in accordance with GAAP would be shown on the consolidated
balance sheet of the Borrower as a liability, (b) all obligations evidenced by
the Medium Term Notes, (c) all obligations, contingent or otherwise, relative to
the face amount of all letters of credit, whether or not drawn, issued for the
account of such Person, and (d) all obligations of such Person as lessee under
leases which have been, in accordance with GAAP, recorded as Capitalized Lease
Obligations.
GAAP - shall have the meaning assigned to such term in SECTION 14.5.
GUARANTOR - shall mean each Subsidiary of the Borrower listed as a
Material Subsidiary in EXHIBIT 8.7 or a Guarantor in EXHIBIT 11.1.8, and any
other Subsidiary of the Borrower that may from time to time execute and deliver
a Guaranty and become a Guarantor pursuant to SECTION 9.2.7.
GUARANTY - shall have the meaning set forth in SECTION 10.3.
HAZARDOUS MATERIAL - shall mean
(a) any "hazardous substance," as defined by CERCLA;
(b) any "hazardous waste," as defined by the Resource Conservation
and Recovery Act, as amended;
11
(c) any petroleum product, crude oil or any fraction thereof; or
(d) any pollutant or contaminant or hazardous, dangerous or toxic
chemical, material or substance within the meaning of any
other Environmental Law.
HEDGING OBLIGATIONS - shall mean, with respect to any Person, (a) all
liabilities of such Person under interest rate swap agreements, interest rate
cap agreements and interest rate collar agreements, and all other agreements or
arrangements designed to protect such Person against fluctuations in interest
rates or currency exchange rates, and (b) all liabilities of such Person under
commodity hedge, commodity swap, exchange, forward, future, collar or cap
agreements, fixed price agreements and all other agreements or arrangements
designed to protect such Person against fluctuations in commodity prices.
HEREIN, HEREOF, HERETO, HEREUNDER and similar terms contained in this
Agreement or any other Loan Document refer to this Agreement or such other Loan
Document, as the case may be, as a whole and not to any particular section,
paragraph or provision of this Agreement or such other Loan Document.
HIGHEST LAWFUL RATE - shall have the meaning assigned to such term in
SECTION 4.16.
HOLDING COMPANY - shall mean Tejas Transok Holding Company, a Delaware
Corporation.
HOLDING COMPANY GUARANTY - shall have the meaning assigned to such term in
SECTION 10.5.
HOLDING COMPANY SECURITY AGREEMENT - shall have the meaning assigned to
such term in SECTION 10.5.
HYDROCARBONS - shall mean collectively, natural gas, oil, condensate and
other liquid and gaseous hydrocarbons, including natural gas or liquid products
extracted from gas.
INCREMENTAL EARNINGS - shall mean at the time any determination thereof is
to be made, the amount, if positive, equal to the sum of (i) 50% of Consolidated
Net Income of the Borrower and its Subsidiaries for each quarter ending on or
prior to the date of such determination (as shown on the financial statements
delivered under SECTION 9.1.2 or, with respect to the last fiscal quarter of any
fiscal year, as shown on the financial statements delivered under SECTION 9.1.1)
in which such Consolidated Net Income is positive AND (ii) 100% of Consolidated
Net Income of the Borrower and its Subsidiaries for each quarter ending on or
prior to the date of such determination (as shown on the financial statements
delivered under SECTION 9.1.2 or, with respect to the last fiscal quarter of any
fiscal year, as shown on the financial statements delivered under SECTION 9.1.1)
in which such Consolidated Net Income is negative, for each quarter beginning
with the fiscal quarter commencing October 1, 1996 through the date of such
determination and, if negative, zero.
12
INCREMENTAL LOSSES - shall mean at the time any determination thereof is
to be made, the amount, if negative, equal to the sum of (i) 50% of Consolidated
Net Income of the Borrower and its Subsidiaries for each quarter ending on or
prior to the date of such determination (as shown on the financial statements
delivered under SECTION 9.1.2 or, with respect to the last fiscal quarter of any
fiscal year, as shown on the financial statements delivered under SECTION 9.1.1)
in which such Consolidated Net Income is positive AND (ii) 100% of Consolidated
Net Income of the Borrower and its Subsidiaries for each quarter ending on or
prior to the date of such determination (as shown on the financial statements
delivered under SECTION 9.1.2 or, with respect to the last fiscal quarter of any
fiscal year, as shown on the financial statements delivered under SECTION 9.1.1)
in which such Consolidated Net Income is negative, for each quarter beginning
with the fiscal quarter commencing October 1, 1996 through the date of such
determination and, if positive, zero.
INDEBTEDNESS - of any Person shall mean, without duplication:
(a) all obligations of such Person for borrowed money and all
obligations of such Person evidenced by bonds, debentures,
notes or other similar instruments (but excluding sight drafts
that evidence trade account payables arising in the ordinary
course of business);
(b) all obligations, contingent or otherwise, relative to the face
amount of all letters of credit, whether or not drawn, and
banker's acceptances issued for the account of such Person;
(c) all obligations of such Person as lessee under leases which
have been or should be, in accordance with GAAP, recorded as
Capitalized Lease Obligations;
(d) all obligations of such Person as lessee of any real or
personal property (or any interest therein) which have not
been or should not be, in accordance with GAAP, recorded as
Capitalized Lease Obligations;
(e) all other items which, in accordance with GAAP, would be
included as liabilities on the liability side of the balance
sheet of such Person as of the date at which Indebtedness is
to be determined;
(f) net liabilities of such Person under all Hedging Obligations;
(g) whether or not so included as liabilities in accordance with
GAAP, all obligations of such Person to pay the deferred
purchase price of property or services (but excluding trade
accounts payable arising in the ordinary course of business),
and indebtedness (excluding prepaid interest thereon) secured
by a Lien on property owned or being purchased by such Person
(including indebtedness arising under conditional sales or
other title
13
retention agreements), whether or not such indebtedness shall
have been assumed by such Person or is limited in recourse;
and
(h) all Contingent Liabilities of such Person in respect of any
Indebtedness of any other Person.
For all purposes of this Agreement, the Indebtedness of any Person shall include
the Indebtedness of any partnership or joint venture in which such Person is a
general partner or a joint venturer.
INDEMNIFIED PARTIES - shall have the meaning assigned to such term in
SECTION 14.8.
INITIAL BORROWING DATE - shall mean the date on which the initial Loans
are made or the initial Letters of Credit are issued hereunder.
INITIAL COMMITMENT AMORTIZATION DATE - shall mean March 31, 1999, or such
later date as may result from any extension requested by the Borrower and
consented to by the Accepting Lenders pursuant to SECTION 2.7.
INTERCOMPANY SUBORDINATED DEMAND NOTES - shall have the meaning assigned
to such term in SECTION 10.4.
ISSUANCE REQUEST - shall mean a request for issuance of a Letter of Credit
and a certificate duly executed by the Borrower substantially in the form of
EXHIBIT 2.3.3A.
ISSUING BANK - shall mean BMO, in its capacity as Letter of Credit issuing
bank, together with its successors and assigns in such capacity.
LAW - shall mean any law (including, without limitation, any zoning law or
ordinance or any Environmental Law), statute, rule, regulation, ordinance,
order, directive, code, interpretation, judgment, decree, injunction, writ,
determination, award, permit, license, authorization, direction, requirement or
decision of and agreement with or by any government or governmental department,
commission, board, court, authority, agency, official or officer, domestic or
foreign.
LEASE - shall mean the Lease, dated as of June 6, 1996 between CIBC Inc.,
as Lessor and Transok Acquisition Corporation III, as Lessee, as the same may be
amended, extended, renewed, supplemented, restated or otherwise modified from
time to time.
LENDERS - is defined in the PREAMBLE.
LENDING INSTALLATION - shall mean a foreign branch, foreign subsidiary or
foreign affiliate of a Lender designated by such Lender pursuant to the
provisions of SECTION 2.2 to make any Eurodollar Loan.
14
LESSEE - shall mean Transok Gas Processing Company, successor by merger to
Transok Acquisition Corporation III, a Delaware corporation.
LESSOR - shall mean CIBC Inc.
LESSOR'S A-INVESTED AMOUNT - is defined in the Participation Agreement.
LESSOR'S B-INVESTED AMOUNT - is defined in the Participation Agreement.
LETTER OF CREDIT - shall have the meaning assigned to such term in SECTION
2.1.2.
LETTER OF CREDIT COMMITMENT - shall mean, relative to the Issuing Bank its
obligation to issue, and relative to any Lender, its obligation to participate
in, Letters of Credit hereunder pursuant to SECTION 2.1.2 and SECTION 2.3.3.
LETTER OF CREDIT COMMITMENT AMOUNT - shall mean, at any time, the lesser
of (i) $50,000,000, as such amount may be reduced pursuant to SECTION 5.1, 5.3,
or 5.5, (ii) an amount equal to the positive difference, if any, between the
Commitment Amount MINUS the aggregate principal amount of all Loans outstanding
at such time and (iii) the Commitment Amount.
LETTER OF CREDIT LIABILITIES - shall mean, at any time, with respect to
any Letter of Credit then in effect, the sum of (i) the undrawn face amount of
such Letter of Credit PLUS (ii) the aggregate unpaid amount, if any, of all
Obligations of the Borrower then due and payable to reimburse the Issuing Bank
and the Lenders in respect of drawings under such Letter of Credit.
LEVERAGE RATIO - shall mean the ratio, expressed as a percentage, of (a)
the sum, without duplication of Funded Debt (other than Indebtedness of the
Borrower outstanding under the RSNs) PLUS Operating Lessor's Debt to (b) the
sum, without duplication, of Adjusted Stockholder's Equity PLUS Funded Debt PLUS
Operating Lessor's Debt. The Borrower shall give written notice promptly to the
Administrative Agent of any changes in the Leverage Ratio which result in a
change to the Applicable Margin or the Commitment Fee Rate, and the
Administrative Agent shall advise each Lender thereof promptly thereafter. For
purposes of determining the appropriate Leverage Ratio, figures of one-half of
one-tenth of one percent (.05%) or more shall be rounded upwards to the nearest
integral multiple of one-tenth of one percent (.1%) and figures of less than
one-half of one-tenth of one percent (.05%) shall be rounded down to the nearest
integral multiple of one-tenth of one percent (.1%).
LIEN - shall mean any interest in any asset or property securing an
obligation owed to, or a claim by, a Person other than the owner of the asset or
property, whether such interest is based on the common law, statute or contract,
and whether such obligation or claim is fixed or contingent, and including,
without limitation, any security interest, mortgage, pledge, lien, claim,
charge, encumbrance, hypothecation, assignment, deposit arrangement, or interest
in property to secure payment of a debt or performance of an obligation;
provided that a negative
15
pledge arrangement or a restriction on alienation is not a Lien for purposes of
this Agreement or any other Loan Document.
LOAN - shall have the meaning assigned to such term in SECTION 2.1.1 and
shall include Loans deemed made or continued pursuant to SECTION 14.6(F).
LOAN COMMITMENT - shall mean, relative to any Lender, such Lender's
obligations to make Loans pursuant to SECTION 2.1.1.
LOAN COMMITMENT AMOUNT - shall mean, at any time, an amount equal to the
positive difference, if any, between (a) the Commitment Amount then in effect
MINUS (b) the aggregate of all Letter of Credit Liabilities.
LOAN DOCUMENTS - shall mean, collectively, this Agreement, the Notes, the
Guaranties, the Security Documents and any other document, instrument or
certificate executed pursuant hereto or thereto as such may be amended,
modified, supplemented, renewed, extended, or restated from time to time.
MAJORITY LENDERS - shall mean, at any time, Lenders holding more than 66
2/3% of the then aggregate outstanding principal or face amount of the
Borrowings, or, if no such principal or face amount is then outstanding, Lenders
having more than 66 2/3% of the total Commitments.
MARGIN STOCK - shall mean "margin stock" as such term is defined in
Regulation U.
MATERIAL SUBSIDIARY - shall mean (i) as of the date hereof the entities
identified as such on EXHIBIT 8.7 and (ii) any Subsidiary of the Borrower having
Consolidated Stockholders' Equity in excess of $15,000,000; provided, that any
Subsidiary which becomes a Material Subsidiary of the type described in the
foregoing clause shall remain a Material Subsidiary for purposes of this
Agreement even if it shall cease to have Consolidated Stockholders' Equity in
excess of $15,000,000 and provided further that the following Subsidiaries shall
not be a Material Subsidiary for purposes of this Agreement: Tranpache
Partnership, a Texas general partnership; Downtown Plaza II, an Oklahoma general
partnership; Southwest Gathering (East Caddo), a joint venture governed by the
Texas Uniform Partnership Act; Southwest Joint Venture (West Caddo); Mistletoe
Gathering System, a joint venture governed by the Oklahoma Uniform Partnership
Act; and Xxxxx Xxxxx Gas Gathering System, a joint venture governed by the laws
of Texas; and (iii) any Subsidiary of the Borrower that is designated by the
Borrower in writing to the Administrative Agent as a Material Subsidiary.
MATERIAL TEJAS SUBSIDIARIES - shall mean Acadian, TGC, TAHC, TNGC and any
Subsidiary of the Parent Company having Consolidated Stockholders' Equity in
excess of $75,000,000.
16
MEDIUM TERM NOTES - shall mean the $200,000,000 Medium Term Notes of the
Borrower issued under the Private Placement Memorandum dated March 30, 1992, and
the Amended Private Placement Memorandum dated August 17, 1992.
MERGER - means the merger of TAC and the Borrower, with the Borrower being
the surviving Person as provided in the Merger Agreement.
MERGER AGREEMENT - shall mean the Agreement of Merger dated May 9, 0000,
xxxxxxx Xxxxxxx xxx Xxxxx Xxxx Corporation and Tejas Gas Corporation relating to
Transok, Inc., as amended, extended, modified or supplemented from time to time.
NET PROCEEDS - shall mean, with respect to any Transfer of any Asset, an
amount equal to the proceeds received by the transferor of such Asset net of
reasonable brokerage and reasonable legal and other closing costs, commissions
and any transfer or similar tax.
NOTE - shall mean a promissory note issued by the Borrower to a Lender
pursuant to the provisions of SECTION 3.1, which note will be issued in
rearrangement and modification, and extension and renewal, of the notes executed
and delivered pursuant to the Original Credit Agreement, as amended, extended,
modified, rearranged and/or supplemented from time to time, together with any
promissory note given in extension, renewal, replacement, rearrangement,
modification and/or substitution thereof or therefor.
NOTES SECURITY AGREEMENT - shall have the meaning assigned to such term in
SECTION 10.4.
OBLIGATIONS - shall mean all obligations (monetary or otherwise) of the
Borrower and each other Obligor arising under or in connection with this
Agreement, the Notes, the Letters of Credit and each other Loan Document.
OBLIGOR - shall mean the Borrower, any Guarantor, and the Holding Company.
OPERATING LESSOR'S DEBT - shall mean Indebtedness in respect of the
A-Notes, the Lessor's A-Invested Amount, the B-Notes and the Lessor's B-Invested
Amount.
OPERATIVE DOCUMENTS - shall have the meaning set forth in the
Participation Agreement.
OPTION TO PURCHASE - shall mean any option to purchase all or a portion of
any pipeline, gas plant, gas gathering system or other related assets of a type
customarily entered into by parties engaged in the gas processing, transporting
and gathering business.
ORIGINAL CREDIT AGREEMENT - shall have the meaning assigned to such term
in the FIRST RECITAL.
ORIGINAL DESIGNATED MAXIMUM COMMITMENT - shall mean, as to each Lender,
the amount set forth opposite its name on SCHEDULE II or as set forth in the
Assignment and Acceptance
17
Agreement executed by such Lender and its Purchasing Lender and delivered
pursuant to SECTION 14.6.
ORIGINAL TOTAL COMMITTED AMOUNT - shall mean $275,000,000.
OVERNIGHT FUNDS PERIOD - shall mean a period of one or more consecutive
days during which the Overnight Funds Rate exceeds the rates described in
CLAUSES (A)(I) and (A)(II) of the definition "ALTERNATE BASE RATE." Upon the
making, continuing, or converting of any applicable Loan during any such period,
the Administrative Agent shall give prompt notice to the Borrower and the
Lenders of the commencement and termination of such Overnight Funds Period and
the Overnight Funds Rate for such period.
OVERNIGHT FUNDS RATE - shall mean, for any Overnight Funds Period, a
fluctuating interest rate per annum equal for each day during such period to the
rate of interest offered in the interbank market to the Administrative Agent as
the overnight Federal Funds Rate as at or about 10:00 a.m., New York City time
on such day (or if such day is not a Domestic Business Day, for the next
preceding Domestic Business Day) plus 1% per annum.
PARENT COMPANY - shall mean Tejas Gas Corporation, a Delaware corporation.
PARENT COMPANY NOTE - shall have the meaning assigned to such term in
Section 9.3.5 (xviii).
PARTICIPANT - shall have the meaning assigned to such term in SECTION
14.6.
PARTICIPATION AGREEMENT - shall mean the Participation Agreement dated as
of June 6, 1996, among the Lessee, the Lessor, the Transok Guarantor, the
Administrative Agent, the Documentation Agent and the Lenders party thereto, as
amended, modified, supplemented or restated from time to time.
PARTNERSHIP/LIMITED LIABILITY COMPANY SECURITY AGREEMENTS - shall have the
meaning assigned to such term in SECTION 10.2.
PAYEE - shall have the meaning assigned to such term in SECTION 9.3.3(XV).
PAYMENT OFFICE - shall mean the office of Xxxxxx Trust and Savings Bank
located at 000 Xxxxx XxXxxxx Xxxxxx, Xxxxxxx, Xxxxxxxx 00000, or such other
office or branch of a financial institution located in Chicago, Illinois, or New
York City, New York as the Administrative Agent may from time to time designate
by notice to the Borrower and the Lenders.
PAYOR - shall have the meaning assigned to such term in SECTION 9.3.3(XV).
PBGC - shall have the meaning assigned to such term in SECTION 8.8.
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PERCENTAGE - shall mean, relative to any Lender, the percentage set forth
opposite its name on SCHEDULE II, or as set forth in an Assignment and
Acceptance executed by such Lender and its Purchasing Lender and delivered
pursuant to SECTION 14.6, or allocated to such Lender pursuant to SECTION
2.7(C), as the case may be.
PERMITTED BUSINESS - shall have the meaning assigned to such term in
SECTION 9.3.11.
PERMITTED CASH COLLATERAL INVESTMENTS - shall mean marketable obligations,
maturing within one (1) year after acquisition thereof, issued or
unconditionally guaranteed by the United States of America or an instrumentality
or agency thereof and entitled to the full faith and credit of the United States
of America, and money market and mutual funds that invest solely in such
obligations.
PERMITTED INVESTMENT - shall mean the following at any time:
(a) any evidence of Indebtedness, maturing not more than one year
after such time, issued by or guaranteed by the full faith and
credit of the United States of America; or
(b) commercial paper, maturing not more than nine months from the
date of issue, which is issued by, or notes or bonds maturing
not more than one year after such time which is issued by a
corporation (other than an Affiliate of a Borrower) organized
under the laws of any state of the United States or of the
District of Columbia with a senior unsecured debt rating of
AA- or higher by Standard & Poors Ratings Group or the
equivalent by Xxxxx'x Investor Service, Inc. and which
commercial paper is rated A-1 by Standard & Poors Ratings
Group or P-1 by Xxxxx'x Investors Service, Inc.; or
(c) any certificate of deposit or bankers acceptance, or time
deposits including Eurodollar time deposits, in each case,
maturing not more than one year after such time, which is
issued by either
(i) a commercial banking institution that is a member of the
Federal Reserve System and has a combined capital and
surplus and undivided profits of not less than
U.S.$400,000,000 and with a senior unsecured debt rating
of AA- or higher by Standard & Poors Ratings Group or
the equivalent by Xxxxx'x Investor Service, Inc.; or
(ii) a commercial banking institution not organized under the
laws of the United States or any State thereof, that has
a combined capital and surplus and undivided profits of
not less than $500,000,000 and with senior unsecured
debt rating of AA- by Standard & Poors
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Ratings Group or the equivalent by Xxxxx'x Investor
Service, Inc.; or
(d) any repurchase agreement entered into with any Lender (or
other Person) having a senior unsecured debt rating of AA- or
higher by Standard & Poors Ratings Group or the equivalent by
Xxxxx'x Investor Service, Inc. which
(i) is secured by a fully perfected security interest in any
obligation of the type described in CLAUSE (A); and
(ii) has a market value at the time such repurchase agreement
is entered into of not less than 100% of the repurchase
obligation of such Lender (or other Person) thereunder;
(e) any investment permitted by the investment policy of United
States Trust Company of New York as in effect from time to
time; or
(f) any certificate of deposit or bankers acceptance or time
deposits including Eurodollar time deposits, in each case
maturing not more than one year after such time, issued by one
or more local Oklahoma banks; provided, however, that the
aggregate at any time of all such investments permitted by
this clause (f) shall not exceed at any time outstanding
$10,000,000 in the aggregate.
PERSON - shall mean any corporation, limited liability company, trust,
partnership, joint venture, association, joint stock association or other
unincorporated entity or any government or governmental agency, body or
instrumentality; or a natural person.
PLEDGE AGREEMENT - shall have the meaning assigned to such term in SECTION
10.1.
PURCHASING LENDER - shall have the meaning assigned to such term in
SECTION 14.6.
RECEIVABLES - shall mean trade receivables of the Borrower or any of its
Subsidiaries arising in the ordinary course of business and (i) all of the
interest of the Borrower or such Subsidiary in the goods or services the sale or
rendering of which gave rise to such receivables after the passage of title
thereto to any obligor, (ii) all security interests, mortgages, pledges,
hypothecations, assignments, deposit arrangements, encumbrances, liens or
charges and property subject thereto from time to time purporting to secure
payment of such receivables and (iii) all guarantees, insurance, letters of
credit and other agreements or arrangements of whatever character from time to
time supporting or securing payment of any such receivables.
RECEIVABLES FINANCING - shall mean the Transfer by the Borrower or any
Subsidiary of the Borrower of Receivables or of an undivided ownership interest
in a Receivables pool purporting to be a sale (and considered a sale under GAAP)
that (i) does not provide, directly
20
or indirectly, for recourse against the seller of such Receivables (or against
the Borrower or any Subsidiary of the Borrower) by way of guaranty or any other
support arrangement for the collectibility of such Receivables (based on
financial conditions or circumstances of the obligor thereunder) other than such
limited recourse as is related to historical bad debt loss experience or (ii)
does not satisfy the requirements of the foregoing clause (i).
REDUCED DECLINING LENDER - shall have the meaning assigned to such term in
SECTION 2.7(C)(II).
REFERENCE LENDERS - shall mean BMO and CIBC.
REGULATION G - shall mean Regulation G of the Board of Governors of the
Federal Reserve System, from time to time in effect, and all official rulings
and interpretations thereunder or thereof.
REGULATION T - shall mean Regulation T of the Board of Governors of the
Federal Reserve System, from time to time in effect, and all official rulings
and interpretations thereunder or thereof.
REGULATION U - shall mean Regulation U of the Board of Governors of the
Federal Reserve System, as from time to time in effect, and all official rulings
and interpretations thereunder or thereof.
REGULATION X - shall mean Regulation X of the Board of Governors of the
Federal Reserve System, as from time to time in effect, and all official rulings
and interpretations thereunder or thereof.
REGULATORY CHANGE - shall mean, relative to any Lender, any change
occurring after the date hereof in any (or the adoption after the date hereof of
any new):
(a) United States Federal or state law or foreign law applicable
to such Lender; or
(b) regulation, interpretation, directive, or request (whether or
not having the force of law) applicable to such Lender of any
court or governmental authority charged with the
interpretation or administration of any law referred to in
CLAUSE (A) or of any fiscal, monetary, or other authority
having jurisdiction over such Lender.
REIMBURSEMENT OBLIGATION - shall have the meaning assigned to such term in
SECTION 2.4.2.
RELEASE - shall mean a "release," as such term is defined in CERCLA.
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REQUIRED LENDERS - shall mean, at any time, Lenders holding at least 51%
of the then aggregate outstanding principal or face amount of the Borrowings,
or, if no such principal or face amount is then outstanding, Lenders having at
least 51% of the total Commitments.
RESOURCE CONSERVATION AND RECOVERY ACT - shall mean the Resource
Conservation and Recovery Act, 42 U.S.C. Section 690, ET SEQ., as in effect from
time to time.
REVOLVING COMMITMENT - shall mean, relative to any Lender, such Lender's
obligation to make Loans and to participate in Letters of Credit pursuant to
SECTIONS 2.1.1 and 2.1.2.
RSN - shall mean one or more revolving subordinated promissory notes from
the Borrower payable to the Holding Company or the Parent Company in the form of
EXHIBIT 9.3.3 and shall include the Subordinated Promissory Note (RSN) dated as
of June 6, 1996 from the Borrower payable to the Parent Company.
SCHEDULED COMMITMENT TERMINATION DATE - shall mean December 31, 2004, or
such other later date as may result from any extension requested by the Borrower
and consented to by the Accepting Lenders pursuant to SECTION 2.7.
SECURITY DOCUMENTS - shall mean, collectively, the Pledge Agreements, the
Notes Security Agreement, the Holding Company Guaranty, the Holding Company
Security Agreement, the Partnership/Limited Liability Company Security
Agreements and any and all additional security documents described in SECTION
9.2.7.
STATED MATURITY DATE - shall mean the earlier of:
(a) the Scheduled Commitment Termination Date; and
(b) either
(i) the occurrence of any Event of Default described in SECTION
12.1.4; or
(ii) the occurrence and continuance of any other Event of Default
and the declaration of the Loans to be due and payable
pursuant to SECTION 12.2.
STOCKHOLDERS' EQUITY - shall mean, as of the time any determination
thereof is to be made, (i) at a time when the Borrower is a corporation, the sum
of the Borrower's capital stock (which shall exclude treasury stock and any
capital stock subject to mandatory redemption by the issuer at the option of the
holder thereof) and additional paid-in capital, PLUS retained earnings (MINUS
accumulated deficit), and (ii) at a time when the Borrower is a limited
liability company, the sum of all membership interests of all members of the
Borrower, all as shown on the consolidated balance sheet of the Borrower and its
Subsidiaries and based on GAAP.
SUBORDINATED DEBT - shall mean all unsecured Indebtedness of the Borrower
and its Subsidiaries on a consolidated basis for borrowed money which is
subordinated, upon terms
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satisfactory to the Lenders, in right of payment to the payment in full in cash
of all Obligations, including Indebtedness evidenced by the RSNs.
SUBSIDIARY - shall mean a corporation of which any Person and its
Subsidiaries own, directly or indirectly, such number of outstanding shares of
capital stock as have more than fifty percent (50%) of the ordinary voting power
for the election of directors; each partnership of which any Person or any
Subsidiary of any Person is a general partner; and each limited liability
company in which any Person is a member or manager and with an aggregate
interest of more than fifty percent (50%).
TAC - shall have the meaning assigned to such term in the FIRST RECITAL.
TAHC - shall mean Tejas-Acadian Holding Company, a Delaware corporation.
TAXES - shall have the meaning assigned to such term in SECTION 4.10.
TGC - shall mean Tejas Gas Corp., a Nevada corporation.
TNGC - shall mean Tejas Natural Gas Company, a Nevada corporation.
TOTAL COMMITTED AMOUNT - shall mean the lesser of:
(a) the Original Total Committed Amount; and
(b) the aggregate of the Designated Maximum Commitments.
TOTAL INTEREST EXPENSE - shall mean with respect to any period for which a
determination thereof is to be made, the sum, without duplication, of (i) the
aggregate amount of all interest accrued (whether or not paid) on all
Indebtedness of the Borrower and its Subsidiaries on a consolidated basis other
than unpaid accrued interest on Subordinated Debt owed or owing by the Borrower
or any of its Subsidiaries to any Person, including, without limitation, the
RSNs, PLUS (ii) the aggregate amount of all accrued Fixed Rent (whether or not
paid), PLUS (iii) the portion of any rental obligation allocable to interest
expense in accordance with GAAP.
TRANSFER - shall mean (i) a sale, transfer, conveyance, assignment or
other disposition of an Asset (or related Assets) having a Fair Market Value in
excess of $100,000, or (ii) destruction as a result of a casualty of an Asset
(or related Assets) having a Fair Market Value in excess of $500,000 in the
aggregate for any such casualty.
TRANSFER EFFECTIVE DATE - shall have the meaning assigned to such term in
the Assignment and Acceptance.
TRANSFEREE - shall have the meaning assigned to such term in SECTION 14.6.
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TYPE - shall mean, relative to any Loan, the portion thereof, if any,
being maintained as a Domestic Loan or a Eurodollar Loan.
UNITED STATES or U.S. - shall mean the United States of America, its fifty
States and the District of Columbia.
UNMATURED EVENT OF DEFAULT - shall mean any event which with the passage
of time or notice to the Borrower, or both, would constitute an Event of
Default.
UNUSED ASSET TRANSFER ALLOWANCE - shall mean, as of the time any
determination thereof is to be made, the positive difference, if any, of (a) the
product of (i) $40,000,000 times (ii) the number of fiscal years of the Borrower
ended during the period from the Effective Date to such determination date MINUS
(b) the aggregate Fair Market Value of all Assets Transferred during the period
from the Effective Date to such determination date as permitted by SECTION
9.3.8(III).
ARTICLE II
COMMITMENTS OF THE LENDERS;
BORROWING PROCEDURES AND CONDITIONS
SECTION 2.1 COMMITMENTS. Subject to the terms and conditions of this
Agreement, each Lender severally and for itself alone agrees to make extensions
of credit pursuant to the Commitments as described in this ARTICLE II.
SECTION 2.1.1 LOAN COMMITMENT. From time to time on any Business Day
occurring prior to the Commitment Termination Date each Lender will make loans
(relative to such Lender, its "LOANS") to the Borrower equal to such Lender's
Percentage of the aggregate amount of Loans requested by the Borrower to be made
on such day. No Lender shall be permitted or required to make any Loan if, after
giving effect thereto, the aggregate outstanding principal amount of all Loans
(i) of all Lenders would exceed the Loan Commitment Amount or (ii) of such
Lender would exceed such Lender's Percentage of the Loan Commitment Amount or
such Lender's Designated Maximum Commitment. On the terms and subject to the
conditions hereof, the Borrower may from time to time borrow, prepay, repay and
reborrow Loans.
SECTION 2.1.2 LETTER OF CREDIT COMMITMENT. From time to time on any
Business Day occurring at least six (6) Business Days prior to the Commitment
Termination Date then in effect, the Issuing Bank will issue, and each Lender
will participate in, standby letters of credit (herein individually referred to
as a "LETTER OF CREDIT" and collectively referred to as "LETTERS OF CREDIT") for
the account of the Borrower, and in the name of the Borrower or any Subsidiary
of the Borrower, in a principal amount equal to such Lender's Percentage of the
face amount of all Letters of Credit requested by the Borrower to be issued on
such day. Neither the Issuing Bank nor any Lender shall be permitted or required
to issue or participate in any Letter of Credit if, after giving effect thereto,
(i) the aggregate of all Letter of Credit Liabilities outstanding on such date
under and in connection with all Letters of Credit of all Lenders would
24
exceed the Letter of Credit Commitment Amount or (ii) the Percentage of such
Lender in all Letter of Credit Liabilities outstanding on such date would exceed
such Lender's Percentage of the Letter of Credit Commitment Amount. Anything
herein contained to the contrary notwithstanding, BMO's obligations and
commitments to issue Letters of Credit hereunder shall cease immediately and
automatically and without further action of any kind if BMO ceases to be the
Administrative Agent hereunder. On the terms and subject to the conditions
hereof, the Borrower may from time to time request, reimburse and request new
Letters of Credit.
SECTION 2.1.3 LENDERS NOT PERMITTED OR REQUIRED TO MAKE BORROWINGS
AVAILABLE. No Lender shall be permitted or required to make any Loan or
participate in (and the Issuing Bank shall have no obligation to issue) any
Letter of Credit, if, after giving effect thereto and to all other Borrowings
and conversions and continuations to be made on such date, (a) the Aggregate
Revolving Outstandings of all Lenders would exceed the Commitment Amount or (b)
the sum of the aggregate outstanding principal amount of all Loans of such
Lender PLUS the aggregate of such Lender's Percentage of all Letter of Credit
Liabilities would exceed the lesser of (i) such Lender's Percentage of the
Commitment Amount and (ii) such Lender's Designated Maximum Commitment.
SECTION 2.2 DOMESTIC LOANS AND EURODOLLAR LOANS. Subject to the terms and
conditions set forth in ARTICLE VI, each Loan shall be either a Eurodollar Loan
or a Domestic Loan as the Borrower may request, it being understood that Loans
made to the Borrower on any date may be either Eurodollar Loans or Domestic
Loans or a combination thereof. As to any Eurodollar Loan, each Lender may, if
it so elects, fulfill its commitment to make such Eurodollar Loan by causing a
Lending Installation to make such Eurodollar Loan; PROVIDED, HOWEVER, that in
such event the obligation of the Borrower to repay such Eurodollar Loan
nevertheless shall be to such Lender and shall be deemed to be held by such
Lender for the account of such Lending Installation.
SECTION 2.3 BORROWING PROCEDURES. The Borrower shall give the
Administrative Agent prior written or telegraphic notice (in substantially the
form of EXHIBIT 2.3 hereto) of each proposed Borrowing or continuation, and as
to whether such Borrowing or continuation is to be of Domestic Loans, Eurodollar
Loans or Letters of Credit, as follows:
SECTION 2.3.1 DOMESTIC LOANS. The Administrative Agent shall receive
written or telegraphic notice from the Borrower on or before 11:00 a.m. Chicago
time at least one (1) Domestic Business Day prior to the date requested for each
proposed Borrowing of a Domestic Loan of the date of such Borrowing and amount
of such Borrowing (which shall be in a minimum amount of $1,000,000 or in the
unused amount of the Loan Commitment), and the Administrative Agent shall advise
each Lender thereof promptly thereafter. Not later than 10:00 a.m., Chicago
time, on the date specified in such notice for such Borrowing, each Lender shall
provide to the Administrative Agent at the Payment Office, same day or
immediately available funds covering such Lender's Percentage of the requested
Domestic Loan. Upon fulfillment of the applicable conditions set forth in
ARTICLE XI with respect to such Domestic Loan, the Administrative Agent shall
make available to the Borrower the proceeds of each
25
Domestic Loan (to the extent received from the Lenders) by wire transfer of such
proceeds to such account(s) as the Borrower shall have specified in the
Borrowing Request.
SECTION 2.3.2 EURODOLLAR LOANS. The Administrative Agent shall receive
written or telegraphic notice from the Borrower on or before 11:00 a.m. Chicago
time, (i) at least three (3) Eurodollar Business Days prior to the date
requested for each proposed Borrowing or continuation of a Eurodollar Loan
having an initial one (1), two (2), three (3) or six (6) month Eurodollar
Interest Period and (ii) at least four (4) Eurodollar Business Days prior to the
date requested for each proposed Borrowing or continuation of a Eurodollar Loan
having an initial twelve (12) month Eurodollar Interest Period, of the date of
such Borrowing or continuation, as the case may be, the amount of such Borrowing
or continuation, as the case may be (which shall be in a minimum amount of
$5,000,000 or in the unused amount of the applicable Commitment), and the
duration of the initial Eurodollar Interest Period with respect thereto, and the
Administrative Agent shall advise each Lender thereof promptly thereafter. Not
later than 10:00 a.m., Chicago time, on the date specified in such notice for
such Borrowing, each Lender shall provide to the Administrative Agent at the
Payment Office, same day or immediately available funds covering such Lender's
Percentage of the requested Eurodollar Loan. Upon fulfillment of the applicable
conditions set forth in ARTICLE XI with respect to such Eurodollar Loan, the
Administrative Agent shall make available to the Borrower the proceeds of each
Eurodollar Loan (to the extent received from the Lenders) by wire transfer of
such proceeds to such account(s) as the Borrower shall have specified in the
Borrowing Request.
SECTION 2.3.3 LETTERS OF CREDIT. The Administrative Agent shall receive
written or telegraphic notice from the Borrower on or before 11:00 a.m. Chicago
time at least three (3) Domestic Business Days prior to the proposed issuance
date of a Letter of Credit, and the Administrative Agent shall advise the
Issuing Bank and each Lender thereof promptly thereafter. Each Borrowing Request
for the issuance of a Letter of Credit shall be accompanied by an Issuance
Request, substantially in the form of EXHIBIT 2.3.3A, with appropriate
insertions, setting forth in detail the proposed terms of such requested Letter
of Credit, including, without limitation, the proposed date of issuance, amount,
beneficiary, expiry date and documents to be required upon presentation, if any
(such terms regarding documents required upon presentation to be satisfactory in
form and substance to the Issuing Bank). Each Letter of Credit shall have a
fixed expiration date occurring not later than one (1) year after the date of
issuance thereof (and in no event later than five (5) Business Days prior to the
earlier of (a) the Commitment Termination Date in effect at the time of issuance
thereof and (b) the next scheduled Election Effective Date, if any, in effect at
the time of issuance thereof), may, by its terms, be renewable annually for
additional one-year periods (but in no event later than five (5) Business Days
prior to the earlier of (a) the Commitment Termination Date in effect at the
time of renewal thereof and (b) the next scheduled Election Effective Date, if
any, in effect at the time of renewal thereof) unless notice of non-renewal is
received by the beneficiary thereof in accordance with the terms of such Letter
of Credit, and shall provide that demands for payment thereunder be made at
least three (3) Domestic Business Days prior to the proposed date of payment;
PROVIDED, HOWEVER, that for all purposes of this Agreement (other than the
condition requiring delivery of a Borrowing Request and an Issuance Request and
except that customary renewal fees, rather than issuance fees, of the Issuing
Bank shall be payable with respect to such renewals)
26
the renewal of a Letter of Credit shall be considered an issuance thereof and
the Borrower shall be required to comply with all the provisions of this
Agreement with respect to any such renewal to the same extent as if a new Letter
of Credit was being issued on such renewal date. Upon fulfillment of the
applicable conditions set forth in ARTICLE XI and subject to the terms hereof,
the Issuing Bank shall issue such Letter of Credit to the requested beneficiary
no later than the close of business on the date of such proposed issuance. Each
Lender shall, upon the issuance of each Letter of Credit and without further
action, hold a participation therein and each Lender hereby irrevocably and
unconditionally purchases a participation in each such Letter of Credit in an
amount equal to such Lender's Percentage of the face amount of such Letter of
Credit. Each Lender shall, to the extent of its Percentage, be responsible for
reimbursing promptly (and in any event within one Business Day), without setoff,
deduction or counterclaim, the Issuing Bank for Reimbursement Obligations which
have not been reimbursed by the Borrower in accordance with SECTION 2.4.2.
SECTION 2.4 LETTER OF CREDIT PROCEDURES.
SECTION 2.4.1 LETTER OF CREDIT OPERATIONS. The Issuing Bank shall,
promptly following its receipt thereof, examine all documents purporting to
represent a demand for payment by a beneficiary under a Letter of Credit to
ascertain that the same appear on their face to be in conformity with the terms
and conditions of such Letter of Credit. If, after examination, the Issuing Bank
shall have determined that a demand for payment under such Letter of Credit does
not conform to the terms and conditions of such Letter of Credit, then the
Issuing Bank shall, as soon as reasonably practicable, give notice to such
beneficiary to the effect that such demand for payment was not in accordance
with the terms and conditions of such Letter of Credit, stating the reasons
therefor. Thereupon, such beneficiary may attempt to correct any such
non-conforming demand for payment under such Letter of Credit if, and to the
extent that, such beneficiary is entitled (without regard to the provisions of
this sentence) and able to do so. The Lenders hereby expressly agree to accept
as correct and conclusive, in the absence of gross negligence or willful
misconduct, any determination by the Issuing Bank that any demand for payment
under a Letter of Credit complies, or does not comply, with the terms and
conditions of such Letter of Credit.
After determining that a demand for payment under such Letter of Credit
conforms to the terms and conditions thereof, the Issuing Bank shall promptly
notify the Lenders by telecopy of the same.
SECTION 2.4.2 BORROWER'S AGREEMENT TO REPAY LETTER OF CREDIT DRAWINGS. The
Borrower hereby agrees to reimburse the Issuing Bank, forthwith, for each
payment or disbursement made by the Issuing Bank to settle its obligations under
any draft drawn under any Letter of Credit, with interest on the amount so paid
or disbursed by the Issuing Bank from and including the date of payment or
disbursement to, but not including, the date the Issuing Bank is reimbursed
therefor or the Lenders are deemed to have made a Loan in respect thereof
pursuant to the following proviso, as the case may be, at the rate set forth in
SECTION 4.1.1(A) (any and all obligations of the Borrower to reimburse the
Issuing Bank hereunder with respect to each payment or disbursement made by the
Issuing Bank under a Letter of Credit being herein
27
referred to as a "REIMBURSEMENT OBLIGATION" and collectively as "REIMBURSEMENT
OBLIGATIONS"); PROVIDED, HOWEVER, that if any such payment or disbursement shall
not be reimbursed to the Issuing Bank after any grace period for the payment
thereof as provided in SECTION 12.1.1 herein and if the Commitment Termination
Date shall not have occurred, then the Reimbursement Obligation in respect
thereof shall automatically, without notice from or to the Borrower and without
any further authorization from the Borrower (and whether or not the amount
thereof satisfies the conditions of SECTION 2.3.1 and whether or not the
conditions of ARTICLE XI are satisfied), be deemed to be a Loan, made by each of
the Lenders to the Borrower in their respective Percentages of the Issuing
Bank's payments or disbursements bearing interest determined pursuant to SECTION
4.1.1(A) and the related Letter of Credit Liability shall be deemed paid
simultaneously with such funding of the deemed Loan; PROVIDED FURTHER, HOWEVER,
that if any such payment or disbursement shall not be reimbursed to the Issuing
Bank and a Loan shall not be deemed to have been made notwithstanding the
preceding proviso due to failure to meet the applicable conditions in ARTICLE
XI, then the Reimbursement Obligation in respect thereof shall be due and
payable, with interest accruing thereon at the rate set forth in SECTION
4.1.2(C), if applicable.
Any action taken by the Issuing Bank, any Lender, the Administrative
Agent, the Documentation Agent or the Collateral Agent in connection with any
Letter of Credit or any draft thereon or demand for payment thereunder shall, if
in good faith and in conformity with all laws, regulations or customs applicable
thereto, be binding upon the Borrower and its Subsidiaries and shall not place
the Issuing Bank, any Lender, the Administrative Agent, the Collateral Agent or
the Documentation Agent under any resulting liability to the Borrower or any of
its Subsidiaries. Without limiting the generality of the foregoing, the Borrower
and its Subsidiaries assume all risks of the acts or omissions of any
beneficiary or transferee of each Letter of Credit and neither the Issuing Bank,
the Lenders, the Administrative Agent, the Collateral Agent nor the
Documentation Agent nor any of their respective officers, directors or agents
shall be liable or responsible for (i) the use which may be made of any Letters
of Credit or any acts or omissions of any beneficiary or transferee in
connection therewith, (ii) the validity or genuineness of any document specified
in, or demand for payment under, any Letter of Credit, or any endorsements
thereon, even if such document or demand should prove to be in any or all
respects invalid, fraudulent or forged (and the Issuing Bank may accept
documents and demands that appear on their face to be in order, without
responsibility for further investigation, regardless of any notice or
information to the contrary), (iii) failure of any draft to bear any reference
or adequate reference to a Letter of Credit, or failure of any Person to note
the amount of any draft on the reverse side of a Letter of Credit, (iv) errors,
omissions, interruptions or delays in transmission or delivery of any message by
mail, cable, telegram, telecopier, wireless or otherwise, (v) errors in
translation or errors in interpretation of technical terms or (vi) any error,
neglect, default, suspension or insolvency of any of the Issuing Bank's
correspondents. Notwithstanding the foregoing, the Borrower shall not be
obligated to reimburse the Issuing Bank for any wrongful payment or disbursement
made by the Issuing Bank under any Letter of Credit as a result of acts or
omissions constituting gross negligence or willful misconduct on the part of the
Issuing Bank or any of its officers, directors, employees or agents.
28
THE BORROWER WILL ON DEMAND INDEMNIFY AND KEEP THE ISSUING BANK AND EACH
LENDER HARMLESS FROM AND AGAINST ALL LIABILITIES, LOSSES, DAMAGES, CLAIMS,
COSTS, DEMANDS AND ACTIONS WHICH THE ISSUING BANK OR SUCH LENDER MAY SUFFER OR
INCUR IN CONNECTION WITH ANY LETTER OF CREDIT OR ANY PAYMENT THEREUNDER, EXCEPT
TO THE EXTENT DUE TO THE GROSS NEGLIGENCE OR WILLFUL MISCONDUCT OF THE ISSUING
BANK OR SUCH LENDER OR RESULTING FROM THE ISSUING BANK'S OR SUCH LENDER'S OWN
UNEXCUSED BREACH OF ANY MATERIAL PROVISION OF ANY LOAN DOCUMENT, PROVIDED THAT
IT IS THE INTENTION OF THE PARTIES HERETO FOR THE ISSUING BANK AND EACH LENDER
TO BE INDEMNIFIED IN THE CASE OF SIMPLE NEGLIGENCE, INCLUDING THEIR OWN
NEGLIGENCE. The obligations of the Borrower under this SECTION 2.4.2 shall not
be impaired by (i) any waiver or time granted to or by the Issuing Bank, any
Lender, the Documentation Agent, the Administrative Agent or the Collateral
Agent, (ii) any release or dealings with any rights or security of the Issuing
Bank, any Lender, the Documentation Agent, the Administrative Agent or the
Collateral Agent (including, without limitation, under any of the Security
Documents or any of the Guaranties), (iii) any invalidity of any Letter of
Credit or (iv) any other circumstances (other than an express release in writing
by the relevant beneficiaries) which might impair such obligations. Anything in
this SECTION 2.4.2 to the contrary notwithstanding, the Borrower does not hereby
waive its right to pursue an action against the Issuing Bank or any Lender for
willful misconduct or gross negligence by the Issuing Bank, such Lender or any
of their officers, employees or agents in connection with a Letter of Credit or
any payment thereunder.
SECTION 2.4.3 LENDERS' AGREEMENT TO REPAY LETTER OF CREDIT DRAWINGS. Any
action taken by the Issuing Bank, any Lender, the Administrative Agent, the
Documentation Agent or the Collateral Agent in connection with any Letter of
Credit or any draft thereon or demand for payment thereunder shall, if in good
faith and in conformity with all laws, regulations or customs applicable
thereto, be binding upon the Lenders and shall not place the Issuing Bank, any
Lender, the Administrative Agent, the Collateral Agent or the Documentation
Agent under any resulting liability to any of the other Lenders. Without
limiting the generality of the foregoing, the Lenders assume all risks of the
acts or omissions of each beneficiary or transferee of each Letter of Credit and
neither the Issuing Bank nor any of its officers, directors, employees, or
agents shall be liable or responsible for (i) the use which may be made of any
Letters of Credit or any acts or omissions of any beneficiary or transferee in
connection therewith, (ii) the validity or genuineness of any document specified
in, or demand for payment under, any Letter of Credit, or any endorsements
thereon, even if such document or demand should prove to be in any or all
respects invalid, fraudulent or forged (and the Issuing Bank may accept
documents and demands that appear on their face to be in order, without
responsibility for further investigation, regardless of any notice or
information to the contrary), (iii) failure of any draft to bear any reference
or adequate reference to a Letter of Credit, or failure of any Person to note
the amount of any draft on the reverse side of a Letter of Credit, (iv) errors,
omissions, interruptions or delays in transmission or delivery of any message by
mail, cable, telegram, telecopier, wireless or otherwise, (v) errors in
translation or errors in interpretation of technical terms or (vi) any error,
neglect, default, suspension or insolvency of any of the Issuing Bank's
correspondents. Notwithstanding the foregoing, no Lender shall be obligated to
reimburse the Issuing Bank for any wrongful payment or disbursement made by the
Issuing Bank
29
under any Letter of Credit as a result of acts or omissions constituting gross
negligence or willful misconduct on the part of the Issuing Bank or any of its
officers, employees or agents.
SECTION 2.4.4 PROCEDURES FOR DEPOSITING CASH COLLATERAL. Any cash
collateral amounts received by the Collateral Agent pursuant to SECTION 5.7 or
12.3 shall be retained by the Collateral Agent for the benefit of the Lenders as
collateral security for, and the Borrower hereby grants to the Collateral Agent
a security interest in, such cash collateral, the Permitted Cash Collateral
Investments and the proceeds of any thereof to secure, first, the payment of the
Obligations of the Borrower under and in connection with the Letters of Credit
and then the other Obligations of the Borrower under and in connection with this
Agreement and the other Loan Documents. If, and to the extent that (i) all
Obligations of the Borrower in connection with all outstanding Letters of Credit
and all other Obligations have been fully paid and satisfied, and (ii) the
Commitments have terminated, the Collateral Agent shall pay to the Borrower,
upon the Borrower's request therefor, all amounts previously paid by the
Borrower pursuant to SECTION 5.7 or 12.3, plus any interest earned thereon, and
not theretofore applied by the Collateral Agent to reduce amounts payable by the
Borrower to the Issuing Bank and the Lenders under or in connection with the
Letters of Credit or other Obligations. All amounts on deposit pursuant to this
SECTION 2.4.4 shall, until their application to any Obligation or their return
to the Borrower, as the case may be, at the Borrower's written request, be
invested in Permitted Cash Collateral Investments designated by the Borrower,
which Permitted Cash Collateral Investments shall be held by the Collateral
Agent as additional collateral security for the repayment of the Borrower's
Obligations under and in connection with the Letters of Credit and all other
Obligations. Any losses, net of earnings, and reasonable fees and expenses of
such Permitted Cash Collateral Investments shall be charged against the
principal amount invested. The Collateral Agent and the Lenders shall not be
liable for any loss resulting from any Permitted Cash Collateral Investment made
by it at the Borrower's request. The Collateral Agent is not obligated hereby,
or by any other Loan Document, to make or maintain any Permitted Cash Collateral
Investment, except upon written request by the Borrower.
SECTION 2.5 [INTENTIONALLY OMITTED]
SECTION 2.6 INCREASED CAPITAL COSTS. If any Regulatory Change imposes,
modifies, or deems applicable any capital adequacy, capital maintenance, or
similar requirement (including a request or requirement which affects the manner
in which any Lender or the Issuing Bank allocates capital resources to its
commitments, including its Commitments hereunder) and as a result thereof, in
the opinion of such Lender or the Issuing Bank, the rate of return on such
Lender's or the Issuing Bank's capital as a consequence of its Commitments, the
Loans made by such Lender or its issuance of or participation in the Letters of
Credit is reduced to a level below that which such Lender or the Issuing Bank
could have achieved but for such circumstances, then and in each such case upon
notice from time to time by such Lender or the Issuing Bank to the Borrower, the
Borrower shall pay (without duplication of costs paid pursuant to SECTIONS 4.9
and 4.12) to such Lender or the Issuing Bank such additional amount or amounts
as shall compensate such Lender or the Issuing Bank for such reduction in rate
of return. Each Lender and the Issuing Bank, upon determining in good faith that
any additional amounts are
30
payable pursuant to this SECTION 2.6, will give prompt written notice thereof to
the Borrower with a copy to the Administrative Agent, PROVIDED that the failure
to give any such notice shall not release or diminish the Borrower's obligations
to pay additional amounts pursuant to this SECTION 2.6; PROVIDED FURTHER,
HOWEVER, that the Borrower shall not be obligated to pay additional amounts
attributable to such reduction under this SECTION 2.6 in respect of time periods
more than 180 days prior to the date of such notice. A statement of any Lender
or the Issuing Bank as to any such additional amount or amounts (including
calculations thereof in reasonable detail) shall be rebuttable presumptive
evidence of such cost and amount. In determining such amount, any Lender and the
Issuing Bank may use any method of averaging and attribution that it (in its
sole and absolute discretion) shall deem applicable.
SECTION 2.7 EXTENSION OF SCHEDULED COMMITMENT TERMINATION DATE, INITIAL
COMMITMENT AMORTIZATION DATE AND REVOLVING COMMITMENTS.
(a) Subject to the other provisions of this Agreement, the
Commitments of the Lenders shall be effective for an initial
period from the Effective Date to the original Scheduled
Commitment Termination Date; PROVIDED that the Revolving
Commitments of the Lenders, and concomitantly the Initial
Commitment Amortization Date and the Scheduled Commitment
Termination Date, may be extended for successive one-year
periods expiring, in the case of the Revolving Commitments and
the Scheduled Commitment Termination Date, on the date which
is one year from the then Scheduled Commitment Termination
Date, and in the case of the Initial Commitment Amortization
Date, on the date which is one year from the then scheduled
Initial Commitment Amortization Date, in accordance with the
terms of this SECTION 2.7. If the Borrower shall request in an
Annual Certificate of Extension delivered to the
Administrative Agent not more than one hundred twenty (120)
nor less than sixty (60) days prior to an Anniversary Date,
that the Revolving Commitments of the Lenders be extended for
one year from the then Scheduled Commitment Termination Date
and that the Initial Commitment Amortization Date be extended
for one year from the then scheduled Initial Commitment
Amortization Date, then the Administrative Agent shall
promptly notify each Lender of such request and each Lender
shall notify the Administrative Agent, not fewer than thirty
(30) days prior to such Anniversary Date, whether, in the
exercise of its sole discretion, it will extend the Scheduled
Commitment Termination Date and the Initial Commitment
Amortization Date and, in the event such Lender is a Reduced
Declining Lender such notice will specify a proposed Total
Committed Amount and its proposed Designated Maximum
Commitment. Any Lender which shall not timely notify the
Administrative Agent whether it will extend the Scheduled
Commitment Termination Date and the Initial Commitment
Amortization Date shall be deemed to not have agreed to extend
the Scheduled Commitment Termination Date and the
31
Initial Commitment Amortization Date. No Lender shall have any
obligation whatsoever to extend the Scheduled Commitment
Termination Date or the Initial Commitment Amortization Date.
Any agreement to extend the Scheduled Commitment Termination
Date and the Initial Commitment Amortization Date shall be
irrevocable, except as provided in SECTION 2.7(C).
(b) If all the Lenders notify the Administrative Agent pursuant to
CLAUSE (A) of this SECTION 2.7 of their agreement to extend
the Scheduled Commitment Termination Date and the Initial
Commitment Amortization Date (each Lender agreeing to extend
the Scheduled Commitment Termination Date and the Initial
Commitment Amortization Date herein called an "ACCEPTING
LENDER"), then the Administrative Agent shall so notify each
Lender and the Borrower, and such extension shall be effective
without other or further action by any party hereto for such
additional one-year period.
(c) If any one or more of the Lenders shall notify or be deemed to
have notified the Administrative Agent pursuant to CLAUSE (A)
of this SECTION 2.7 that it will not extend the then Scheduled
Commitment Termination Date and the then scheduled Initial
Commitment Amortization Date at the then current Total
Committed Amount (any such Lender herein called a "DECLINING
LENDER"), then (A) the Administrative Agent shall promptly so
notify the Borrower and the Accepting Lenders; (B) the
Accepting Lenders shall, upon the Borrower's election to
extend the then Scheduled Commitment Termination Date and the
then scheduled Initial Commitment Amortization Date in
accordance with CLAUSE (I), (II) or (III) below, extend the
then Scheduled Commitment Termination Date and the then
scheduled Initial Commitment Amortization Date; and (C) the
Borrower shall, pursuant to a notice (an "ELECTION NOTICE")
delivered to the Administrative Agent, the Accepting Lenders
and the Declining Lenders not fewer than ten (10) Business
Days prior to the earlier of (x) December 31 next following
such Anniversary Date and (y) the Election Effective Date,
either:
(i) elect to extend the Scheduled Commitment
Termination Date and the then scheduled Initial
Commitment Amortization Date with respect to the
Accepting Lenders and direct the Declining Lenders
to terminate their Commitments, which termination
shall become effective on the Election Effective
Date. On such Election Effective Date (x) the
Borrower shall deliver notice of the effectiveness
of such termination to the Declining Lenders and
to the Administrative Agent, (y) the Borrower
shall
32
pay in full in immediately available funds (a) all
monetary Obligations of the Borrower hereunder and
(b) all monetary obligations evidenced by the
A-Notes and B-Notes and the Lessor's A-Invested
Amount and Lessor's B-Invested Amount, including,
without limitation, all increased costs, breakage
fees payable under SECTION 4.14 hereof, and all
other costs, fees and expenses payable to each
such Declining Lender hereunder, under the
Operative Documents and under the Operative Loan
Documents (as defined in the Operative Documents),
in each case owing to the Declining Lenders and
otherwise cause the Declining Lenders no longer to
have any liability or obligation under or with
respect to any Letter of Credit issued hereunder,
whether by termination, cancellation, expiration
or amendment of all such Letters of Credit,
replacement of such Letters of Credit, or
otherwise and (z) upon the occurrence of the
events set forth in CLAUSES (X) and (Y), the
Declining Lenders shall cease to be a "Lender"
hereunder for all purposes, other than for
purposes of the last paragraph of SECTION 2.4.2
and SECTIONS 2.6, 4.9, 4.10, 4.12, 4.14, 14.7 and
14.8, and shall cease to have any obligations or
any Commitment hereunder, other than to the
Administrative Agent, the Document Agent and the
Issuing Bank pursuant to SECTION 13.3, to the
Collateral Agent pursuant to Section 10 of the
Collateral Agency Exhibit attached to certain of
the Security Documents and to the Borrower
pursuant to SECTION 14.17, and the Administrative
Agent shall promptly notify the Accepting Lenders
and the Borrower of the new Total Committed Amount
and the respective Percentages of each Accepting
Lender. So long as (a) no Event of Default or
Unmatured Event of Default has occurred and is
continuing, and (b) the Aggregate Revolving
Outstandings do not exceed the new Commitment
Amount, the Administrative Agent shall reallocate
the Percentage of each Lender in the Letters of
Credit issued hereunder at such time; or
(ii) elect to extend the Scheduled Commitment
Termination Date and the Initial Commitment
Amortization Date with respect to (x) the
Accepting Lenders and (y) all of the Declining
Lenders which commit to extend the Scheduled
Commitment Termination Date and the Initial
33
Commitment Amortization Date but only at a lower
Total Committed Amount (any such Declining Lender
herein called a "REDUCED DECLINING LENDER") and
direct the Declining Lenders to terminate or
reduce, as the case may be, their respective
Commitments, which termination or reduction shall
become effective on the Election Effective Date;
PROVIDED, that if one or more Lenders shall be a
Reduced Declining Lender, then effective on the
Election Effective Date, the Total Committed
Amount shall be reduced to the lower of (A) the
lowest Total Committed Amount proposed by a
Reduced Declining Lender in the notice provided
pursuant to SECTION 2.7(A) and (B) the aggregate
of the Designated Maximum Commitments of all
Accepting Lenders and all Reduced Declining
Lenders and provided further, if one or more
Lenders shall be a Declining Lender, each
remaining Lender's Percentage shall be adjusted to
equal the quotient of (1) such Lender's Designated
Maximum Commitment DIVIDED BY (2) the reduced
Total Committed Amount. On such Election Effective
Date (x) the Borrower shall deliver a notice of
the effectiveness of such termination or
reduction, as the case may be, to such Declining
Lenders and to the Administrative Agent and (y)
the Borrower shall pay in full in immediately
available funds (A) all monetary Obligations of
the Borrower hereunder and (B) all monetary
obligations evidenced by the A-Notes and the
B-Notes and the Lessor's A-Invested Amount and
Lessor's B-Invested Amount, including, without
limitation, all increased costs, breakage fees,
amounts payable under SECTION 4.14 hereof, and all
other costs, fees and expenses payable to each
such Declining Lender hereunder, under the
Operative Documents and under the Operative Loan
Documents (as defined in the Operative
Documents),and otherwise cause such Declining
Lenders (to the extent of the reduction of their
respective Commitments) no longer to have any
liability or obligation under or with respect to
any Letter of Credit issued hereunder, whether by
termination, cancellation, expiration or amendment
of all such Letters of Credit, replacement of such
Letters of Credit, or otherwise and pay to the
Reduced Declining Lenders and the Accepting
Lenders such amounts as are necessary to cause the
amounts owing to the Reduced Declining Lenders and
the Accepting Lenders to reflect their reduced
Commitments
34
and their new Percentages and (z) upon the
occurrence of the events set forth in CLAUSES (X)
and (Y), each Declining Lender as is terminating
its respective Revolving Commitments shall cease
to be a "Lender" hereunder for all purposes, other
than for purposes of the last paragraph of SECTION
2.4.2 and SECTIONS 2.6, 4.9, 4.10, 4.12, 4.14,
14.7 and 14.8, and shall cease to have any
obligations or any Commitment hereunder, other
than to the Administrative Agent, the
Documentation Agent and the Issuing Bank pursuant
to SECTION 13.3, to the Collateral Agent pursuant
to Section 10 of the Collateral Agency Exhibit
attached to certain of the Security Documents and
to the Borrower pursuant to SECTION 14.17, and the
Administrative Agent shall promptly notify the
Accepting Lenders, the Reduced Declining Lenders
and the Borrower of the new Total Committed Amount
and the respective Percentages of each Lender. So
long as (a) no Event of Default or Unmatured Event
of Default has occurred and is continuing, and (b)
the Aggregate Revolving Outstandings do not exceed
the new Commitment Amount, the Administrative
Agent shall reallocate the Percentage of each
Lender in the Letters of Credit issued hereunder
at such time; or
(iii) (a) elect to extend the Scheduled Commitment
Termination Date and the Initial Commitment
Amortization Date with respect to (1) the
Accepting Lenders and (2) the Reduced Declining
Lenders, and to replace the Declining Lenders that
are not extending the then Scheduled Commitment
Termination Date and the Initial Commitment
Amortization Date at any Total Committed Amount,
effective on the Election Effective Date, with one
or more banks or financial institutions reasonably
acceptable to the Co-Agents and the Issuing Bank
or (b) elect to extend the Scheduled Commitment
Termination Date and the Initial Commitment
Amortization Date with respect to the Accepting
Lenders and to replace (1) one or more of the
Reduced Declining Lenders and (2) the Declining
Lenders that are not extending the then Scheduled
Commitment Termination Date and the Initial
Commitment Amortization Date at any Total
Committed Amount, effective on the Election
Effective Date, with one or more banks or
financial institutions reasonably acceptable to
the Administrative
35
Agent, the Documentation Agent and the Issuing
Bank; PROVIDED, that (v) if one or more Lenders
shall be a Reduced Declining Lender that is not
being replaced, then effective on the Election
Effective Date, the Total Committed Amount shall
be reduced to the lower of (A) the lowest Total
Committed Amount proposed by a Reduced Declining
Lender that is not being replaced in the notice
provided pursuant to SECTION 2.7(A) and (B) the
aggregate of the Designated Maximum Commitments of
all Accepting Lenders and the Reduced Declining
Lenders that are not being replaced, (w) on such
date the Borrower shall pay in immediately
available funds to such Reduced Declining Lenders
that are not being replaced and to the Accepting
Lenders such amounts as are necessary to cause
amounts owing to such Reduced Declining Lenders to
reflect their reduced Commitments and their new
Percentages, (x) the replacement banks or
financial institutions shall purchase (A) the Note
or Notes, and (B) the A-Note and B-Note or the
A-Notes and B-Notes and the Lessor's A-Invested
Amount and Lessor's B-Invested Amount, as the case
may be, of the Declining Lender or Lenders being
replaced and such Declining Lender's or Lenders'
rights hereunder, under the Participation
Agreement without recourse or expense to, or
warranty by, such Declining Lender or Lenders
being replaced for a purchase price equal to the
aggregate outstanding principal amount of the Note
or Notes payable to such Declining Lender or
Lenders PLUS such Declining Lender's or Lenders'
respective Percentage of any outstanding
Reimbursement Obligations PLUS any accrued but
unpaid interest on such Note or Notes and such
Reimbursement Obligations PLUS the principal
amount of such A-Note and B-Note or A-Notes and
B-Notes and the Lessor's A-Invested Amount and
Lessor's B-Invested Amount, as the case may be,
PLUS interest and accrued yield thereon PLUS any
accrued but unpaid fees in respect of such
Declining Lender's or Lenders' outstanding
Borrowings and Percentage of Commitments hereunder
PLUS such replacement banks or financial
institutions shall assume such Declining Lender's
or Lenders' respective Percentage with respect to
any outstanding Letters of Credit hereunder, (y)
all monetary Obligations of the Borrower owing
under or in connection with this Agreement, and
the Operative Documents to the
36
Declining Lender or Lenders being replaced
(including, without limitation, such increased
costs, breakage fees payable under SECTION 4.14
hereof, and all other costs, fees and expenses
payable to each such Declining Lender being
replaced hereunder) shall be paid by the Borrower
in full in immediately available funds to such
Declining Lender or Lenders being replaced
concurrently with such replacement and (z) upon
the payment of such amounts referred to in CLAUSES
(X) and (Y), the replacement banks or financial
institutions shall each constitute a "Lender"
hereunder and the Declining Lenders or Lenders
being so replaced shall no longer constitute a
"Lender" hereunder (other than for purposes of the
last paragraph of SECTION 2.4.2 and SECTIONS 2.6,
4.9, 4.10, 4.12, 4.14, 14.7 and 14.8) and shall no
longer have any obligations hereunder, other than
to the Administrative Agent, the Co-Agents and the
Issuing Bank pursuant to SECTION 13.3, to the
Collateral Agent pursuant to Section 10 of the
Collateral Agency Agreement attached to certain of
the Security Documents and to the Borrower
pursuant to SECTION 14.17. So long as (a) no Event
of Default or Unmatured Event of Default has
occurred and is continuing, and (b) the Aggregate
Revolving Outstandings do not exceed the new
Commitment Amount, the Administrative Agent shall
reallocate the Percentage of each Lender in the
Letters of Credit issued hereunder at such time;
or
(iv) elect to revoke and cancel the extension request
in such Annual Certificate of Extension by
giving written notice of such revocation and
cancellation to the Administrative Agent (which
shall promptly notify the Lenders thereof) at
least ten (10) Business Days prior to the
December 31 next following such Anniversary
Date.
If the Borrower fails to provide the Election Notice referred
to in this CLAUSE (C) on or prior to the tenth (10th) Business
Day preceding the December 31 next following the relevant
Anniversary Date, the Borrower shall be deemed to have revoked
and cancelled its extension request in the Annual Certificate
of Extension and to have elected not to extend the
Commitments, the Initial Commitment Amortization Date and the
Scheduled Commitment Termination Date. Upon the election by
the Borrower described in CLAUSES (I)-(IV), the Borrower shall
give prompt notice to the Administrative Agent of such
election, but nothing herein
37
shall be deemed to require Borrower to make such election
before ten (10) Business Days prior to the December 31 next
following the relevant Anniversary Date.
ARTICLE III
PROVISIONS RELATING TO THE NOTES AND REPAYMENT
SECTION 3.1 THE NOTES. Each Lender's Loans under the Revolving Commitment
shall be evidenced by a Note of the Borrower substantially in the form set forth
in EXHIBIT 3.1 (such Note herein called the "NOTE") with appropriate insertions,
and dated the Initial Borrowing Date (or such other date prior thereto as shall
be satisfactory to the Co-Agents), payable to the order of such Lender in a
maximum principal amount equal to such Lender's Percentage of the Original Total
Committed Amount. The date and amount of each Loan made by such Lender and of
each repayment of principal thereon received by such Lender shall be recorded by
such Lender in its records or, at its option, on the schedule attached to the
Note issued to such Lender. The aggregate unpaid principal amount so recorded
shall be rebuttable presumptive evidence of the principal amount owing and
unpaid on such Note. The failure to so record any such amount or any error in so
recording any such amount shall not, however, limit or otherwise affect the
obligations of the Borrower hereunder or under any Note to repay the principal
amount of the Loans together with all interest accruing thereon.
SECTION 3.2 REPAYMENTS. The Borrower shall repay in full the unpaid
principal amount of each Loan upon the Stated Maturity Date.
SECTION 3.3 DUE DATE EXTENSION. If any payment of principal of, or
interest on, any Eurodollar Loan shall fall due on a day which is not a
Eurodollar Business Day, or if any pay ment of principal of or interest on any
Domestic Loan or any payment of any fee provided for herein or any other amount
due hereunder shall fall due on a day which is not a Domestic Business Day, then
such due date shall be extended to the next succeeding Eurodollar Business Day
or Domestic Business Day, as the case may be (unless, with respect to a payment
relating to a Eurodollar Loan, such due date would fall in another calendar
month, in which event payment shall be made on the next preceding Eurodollar
Business Day) and additional interest and fees shall accrue and be payable for
the period of such extension.
ARTICLE IV
INTEREST, FEES AND SPECIAL
EURODOLLAR LOAN RELATED PROVISIONS
SECTION 4.1 INTEREST ON THE BORROWINGS.
SECTION 4.1.1 INTEREST PRIOR TO MATURITY. Until maturity (whether on the
Stated Maturity Date, upon acceleration or otherwise), the unpaid principal
amount from time to time
38
outstanding on the Loans and any unpaid Reimbursement Obligations with respect
to the Letters of Credit shall bear interest at a fluctuating rate per annum
equal to:
(a) as to any unpaid principal amount representing Domestic Loans
or any unpaid Reimbursement Obligations with respect to the
Letters of Credit, the sum of the Alternate Base Rate from
time to time in effect, PLUS the Applicable Margin for Loans
with respect to Domestic Loans from time to time in effect,
and
(b) as to any unpaid principal amount representing Eurodollar
Loans, the sum of the Eurodollar Interest Rate for the
applicable Eurodollar Interest Period in effect, PLUS the
Applicable Margin for Loans with respect to Eurodollar Loans
from time to time in effect.
SECTION 4.1.2 INTEREST AFTER MATURITY. After the date any principal amount
of any Loan is due and payable (whether on the Stated Maturity Date, upon
acceleration or otherwise) and after any other monetary Obligation with respect
to Letters of Credit of the Borrower hereunder shall have become due and
payable, and after any applicable grace periods have lapsed, until paid, such
due and payable amounts and Obligations shall bear interest, but only to the
extent permitted by applicable law, at a fluctuating rate per annum equal to:
(a) as to any unpaid principal amount representing Domestic Loans
and, to the extent permitted by applicable law, as to any
unpaid, accrued interest on Domestic Loans, the sum of the
Applicable Default Margin, PLUS the Applicable Margin for
Loans with respect to Domestic Loans from time to time in
effect, PLUS the Alternate Base Rate from time to time in
effect (but not less than the Alternate Base Rate in effect at
maturity); and
(b) as to any unpaid principal amount representing Eurodollar
Loans and, to the extent permitted by applicable law, as to
any unpaid, accrued interest on Eurodollar Loans, the sum of
the Applicable Default Margin, PLUS the Applicable Margin for
Loans with respect to Eurodollar Loans from time to time in
effect, PLUS the Eurodollar Interest Rate for a Eurodollar
Interest Period of one (1) day, one (1) week, or one (1) month
(as the Administrative Agent shall select in the exercise of
its sole discretion) determined as at 9:00 a.m., Chicago time,
on the Eurodollar Business Day next succeeding that on which
the Administrative Agent became aware of such default, all of
the foregoing as determined by the Administrative Agent;
PROVIDED that so long as the principal amount or any part
thereof of any such Eurodollar Loan remains unpaid, the rate
herein provided for shall be recalculated on the same basis as
aforesaid on the last day of each period for which such rate
has been determined as aforesaid. If on any occasion any of
the Reference Lenders is unable, or for any reason fails, so
to notify the Administrative Agent by 10:00 a.m., Chicago time
on
39
such Eurodollar Business Day, such interest rate shall be
determined on the basis of the quotations furnished by the
other Reference Lenders to the Administrative Agent at or
prior to said 10:00 a.m.; and
(c) as to any other unpaid monetary Obligations with respect to
Letters of Credit, the sum of the Applicable Default Margin,
PLUS the Applicable Margin for Loans with respect to Domestic
Loans from time to time in effect, PLUS the Alternate Base
Rate from time to time in effect.
SECTION 4.2 NOTICE OF EURODOLLAR INTEREST RATE; DETERMINATION CONCLUSIVE.
The Eurodollar Interest Rate with respect to each Eurodollar Interest Period
shall be determined by the Administrative Agent as provided in the definition of
Eurodollar Interest Rate in SECTION 1.1, and notice thereof shall be given
promptly by the Administrative Agent to the Borrower and the Lenders. Each
determination of the Eurodollar Interest Rate by the Administrative Agent shall
be conclusive and binding upon the parties hereto, in the absence of
demonstrable error. At the request in writing of the Borrower, however, the
Administrative Agent shall deliver to the Borrower a statement showing in
reasonable detail the computations used by the Administrative Agent in
determining the Eurodollar Interest Rate.
SECTION 4.3 EURODOLLAR INTEREST PERIODS. Subject to the provisions of
SECTION 4.1.2(B) and subject to the requirements of the definition of Eurodollar
Interest Period, the Borrower may elect to continue a Eurodollar Loan from one
Eurodollar Interest Period into the subsequent Eurodollar Interest Period, in
the notice required by SECTION 2.3.2 above. If no such election is made and such
Eurodollar Loan is not repaid, the Borrower shall be deemed to have elected a
one (1) month Eurodollar Interest Period.
SECTION 4.4 COMMITMENT FEE; OTHER FEES.
(a) The Borrower agrees to pay to the Administrative Agent for the
account of each Lender, for the period commencing on the
Effective Date, and continuing through the Commitment
Termination Date, a commitment fee at a rate PER ANNUM equal
to the Commitment Fee Rate on such Lender's Percentage of the
sum of the average daily unused portion of the Commitment
Amount (it being understood that, with respect to any Lender,
the principal amount of its Loans and the outstanding
principal amount of its Percentage of Letter of Credit
Liabilities shall be considered utilizations of the Commitment
Amount). Such commitment fees shall be payable by the Borrower
in arrears on the last Business Day of March, June, September
and December of each year, the first such payment to be made
on December 31, 1996 for the period then ending for which no
fees shall theretofore have been paid, and on the Commitment
Termination Date.
40
(b) The Borrower agrees to pay to the Administrative Agent for the
account of each Lender a restructuring fee pursuant to that
certain fee letter agreement dated the date hereof between the
Borrower and the Administrative Agent.
SECTION 4.5 LETTER OF CREDIT FEES. (a) The Borrower agrees to pay to the
Administrative Agent for the account of each Lender with respect to each Letter
of Credit issued hereunder, for the period from and including the date of
issuance of such Letter of Credit to (but not including) the date on which such
Letter of Credit expires, a letter of credit fee at a rate PER ANNUM equal to
the Applicable Margin for Letters of Credit on such Lender's Percentage of the
face amount of such Letter of Credit. Such letter of credit fees shall be
payable by the Borrower in arrears on the last Business Day of March, June,
September and December of each year, the first such payment to be made on the
last day of the first calendar quarter for which a Letter of Credit is first
outstanding hereunder for which no fees shall theretofore have been paid, and on
the date such Letter of Credit expires.
(b) The Borrower agrees to pay to the Issuing Bank an issuance fee and a
renewal fee for each Letter of Credit issued hereunder, payable at the time of
issuance or renewal of such Letter of Credit, as the case may be, and
negotiation fees on each sight draft drawn under a Letter of Credit and
amendment fees in respect of the amendment of each Letter of Credit, payable on
demand, such issuance fees, renewal fees, negotiation fees and amendment fees to
be in amounts mutually agreed by the Borrower and the Issuing Bank.
SECTION 4.6 PAYMENT OF INTEREST; CALCULATION OF INTEREST AND FEES.
Interest accrued on each Note prior to maturity (whether by acceleration or
otherwise) shall be payable:
(a) on Eurodollar Loans, on the last day of each applicable
Eurodollar Interest Period and, if such Eurodollar Interest
Period shall exceed three (3) months, on the day of each third
month during such Eurodollar Interest Period which is
numerically equivalent to the Eurodollar Period Commencement
Date for such Eurodollar Interest Period or if there exists no
numerically corresponding day in such month, on the last
Eurodollar Business Day of such month (each such date herein
called a "EURODOLLAR INTEREST PAYMENT DATE");
(b) on Domestic Loans, in arrears, on the last Business Day of
each March, June, September, and December of each year,
commencing with the first quarterly period during which
Domestic Loans are outstanding hereunder for which no interest
shall theretofore have been paid;
and at the Stated Maturity Date for each Loan. After maturity (whether by
acceleration or otherwise), interest shall be payable on demand. All interest
on Domestic Loans and all commitment and letter of credit fees due under this
Agreement shall be calculated on the basis of the actual number of days elapsed
in a year consisting of 365 days (or 366 days in a leap year, as
41
applicable). All interest on the Eurodollar Loans shall be calculated on the
basis of the actual number of days elapsed in a year consisting of 360 days.
Where interest is calculated on the basis of the Alternate Base Rate, such rate
shall change simultaneously with each change in the Alternate Base Rate.
SECTION 4.7 EURODOLLAR DEPOSITS UNAVAILABLE OR EURODOLLAR INTEREST RATE
UNASCERTAINABLE. In the event that, prior to any Eurodollar Period Commencement
Date in respect of any Eurodollar Loans, the Administrative Agent shall have
determined (which determination shall be conclusive and binding on all parties
hereto) that Dollar deposits of the relevant amount and for the relevant
Eurodollar Interest Period for such Eurodollar Loans are not available to the
Lenders in the interbank Eurodollar market or that, by reason of circumstances
affecting the interbank Eurodollar market, adequate and reasonable means do not
exist for ascertaining the Eurodollar Interest Rate applicable to such
Eurodollar Interest Period or the Required Lenders advise the Administrative
Agent that the Eurodollar Interest Rate as determined by the Administrative
Agent will not adequately and fairly reflect the cost to such Required Lenders
of maintaining or funding Eurodollar Loans for the relevant Eurodollar Interest
Period, the Administrative Agent shall promptly give notice of such
determination to the Borrower and the Lenders and (i) the Borrower's request for
a proposed Eurodollar Loan shall be deemed a request for a Domestic Loan, (ii)
any outstanding Eurodollar Loans (unless the Administrative Agent subsequent to
such determination of unavailability shall determine that such Dollar deposits
are again available) shall be converted, without any notice to or from the
Borrower, into Domestic Loans on the last day of the then current Eurodollar
Interest Period for any outstanding Eurodollar Loan, and (iii) the obligation of
the Lenders to make or maintain Eurodollar Loans shall forthwith terminate,
provided that if circumstances subsequently change so that the Lenders shall not
continue to be so affected, the Lenders shall by notice to the Borrower
reinstate their obligations to make, convert, maintain or continue Domestic
Loans as, or into, Eurodollar Loans.
SECTION 4.8 CHANGES IN LAW RENDERING EURODOLLAR LENDING UNLAWFUL. In the
event that any change in (including the adoption of any new) applicable Laws or
regulations, or in the interpretation or application thereof by any governmental
or other regulatory authority charged with the administration thereof, should
make it unlawful for any Lender to make, continue or maintain any Loan as, or to
convert any Loan to, a Eurodollar Loan, the Commitment of such Lender to make,
continue and maintain any Loan as, and to convert any Loan to, a Eurodollar Loan
shall, upon the happening of such event, forthwith terminate and such Lender
shall, by written notice to the Borrower, declare that such Commitment has so
terminated; and if any such change or adoption shall make it unlawful for such
Lender to maintain any Eurodollar Loan made by it hereunder, such Lender shall,
upon the happening of such event, notify the Borrower thereof in writing stating
the reasons therefor, and the Borrower shall, at the maturity thereof (or such
earlier date as may be required by the relevant law, regulation, interpretation
or application), repay such Eurodollar Loan with respect to such Lender in full.
Upon the happening of any such event, such Eurodollar Loan shall automatically
convert to a Domestic Loan at the end of the current Eurodollar Interest Period
with respect thereto (or such earlier date as may be required by the relevant
law, regulation, interpretation
42
or application) provided that if circumstances subsequently change so that such
Lender shall not continue to be so affected, such Lender shall by notice to the
Borrower reinstate its obligations to make, convert, maintain or continue Loans
as, or into, Eurodollar Loans.
SECTION 4.9 SPECIAL FEES IN RESPECT OF RESERVE REQUIREMENTS. With respect
to Eurodollar Loans, the Borrower agrees to pay to each Lender on appropriate
Eurodollar Interest Payment Dates, as additional interest, such amounts as will
compensate such Lender for any cost to such Lender, from time to time, of any
reserve, special deposit, special assessment or similar capital requirements
against assets of, deposits with or for the account of, or credit extended by,
such Lender which are imposed on, or deemed applicable by, such Lender, from
time to time, under or pursuant to (i) any Law, treaty, regulation or directive
now or hereafter in effect (including, without limitation, Regulation D of the
Board of Governors of the Federal Reserve System but excluding any reserve
requirement included in the definition of Eurodollar Interest Rate in SECTION
1.1,) (ii) any interpretation or application thereof by any governmental
authority, agency or instrumentality charged with the administration thereof or
by any court, central bank or other fiscal, monetary or other authority having
jurisdiction over the Eurodollar Loans or the office of such Lender where its
Eurodollar Loans are lodged, or (iii) any requirement imposed or requested by
any court, governmental authority, agency or instrumentality or central bank,
fiscal, monetary or other authority, whether or not having the force of law. A
certificate as to the amount of any such cost or any change therein (including
calculations, in reasonable detail, showing how such Lender computed such cost
or change) shall be promptly furnished by such Lender to the Borrower and, in
the absence of manifest error, shall be rebuttable presumptive evidence of such
cost or change. The Borrower will not be responsible for paying any amounts
pursuant to this SECTION 4.9 accruing prior to 180 days prior to the receipt by
the Borrower of the certificate referred to in the preceding sentence. Within
fifteen (15) days after such certificate is furnished to the Borrower, the
Borrower will pay directly to such Lender such additional amount or amounts as
will compensate such Lender for such cost or change.
SECTION 4.10 TAXES. All payments by the Borrower of principal of, and
interest on, the Loans and all other amounts payable hereunder shall be made
free and clear of and without deduction for any present or future income,
excise, stamp or franchise taxes and other taxes, fees, duties, withholdings or
other charges of any nature whatsoever imposed by any taxing authority, but
excluding franchise taxes and taxes imposed on or measured by any Lender's net
income or receipts imposed on such Lender as a result of a present or former
connection between the government or taxing authority imposing such tax and such
Lender or any political subdivision or taxing authority thereof or therein
(other than a connection arising solely from such Lender having executed,
delivered or performed its obligations or received a payment under, or enforced
this Agreement or the Notes) (such non-excluded taxes, fees, duties,
withholdings, charges and other items being called "TAXES"). In the event that
any withholding or deduction from any payment to be made by the Borrower
hereunder is required in respect of any Taxes pursuant to any applicable law,
rule or regulation, or if any Taxes are directly asserted against the
Administrative Agent or any Lender with respect to any payment received by the
Administrative Agent or such Lender hereunder, the Administrative Agent or such
43
Lender, as the case may be, shall promptly notify the Borrower thereof, and the
Borrower will promptly pay to the Administrative Agent for its or such Lender's
account such additional amount or amounts as is necessary in order that the net
amount received by the Administrative Agent and each Lender after any
withholding or deduction and the payment of such Taxes (including any Taxes on
such additional amount) shall equal the amount such person would have received
had not such withholding or deduction been required or such Taxes been asserted.
If the Borrower fails to pay any Taxes when due to the appropriate taxing
authority, the Borrower shall indemnify the Lenders for any incremental Taxes,
interest or penalties that may become payable by any Lender as a result of any
such failure. For purposes of this SECTION 4.10, a distribution hereunder by the
Administrative Agent or any Lender to or for the account of any Lender shall be
deemed a payment by the Borrower.
Upon the request of the Borrower or the Administrative Agent, each Lender
that is organized under the laws of a jurisdiction other than the United States
shall, prior to the due date of any payments in respect of the Borrowings,
execute and deliver to the Borrower and the Administrative Agent, on or about
January 15 of each calendar year, one or more (as the Borrower or the
Administrative Agent may reasonably request) United States Internal Revenue
Service Forms 4224 or Forms 1001 or such other forms or documents (or successor
forms or documents), appropriately completed, as may be applicable to establish
the extent, if any, to which a payment to such Lender is exempt from withholding
or deduction of Taxes.
SECTION 4.11 REASONABLE EFFORTS. Each Lender agrees that it will use all
reasonable efforts in order to avoid or to minimize, as the case may be, the
payment by the Borrower of any additional amounts under SECTION 4.9, SECTION
4.10 or SECTION 4.12 or the subjecting of any payment by the Borrower to any
withholding tax, and that it will, as promptly as practicable, notify the
Borrower of the existence of any event which will require the payment by the
Borrower of any such additional amounts or the subjecting of any payment by the
Borrower to any withholding tax; PROVIDED, HOWEVER, that the foregoing shall not
in any way affect the rights of any Lender or the obligations of the Borrower
under said Sections, and PROVIDED FURTHER that no Lender shall be obligated to
make its Eurodollar Loans hereunder at any office located in the United States
of America, and PROVIDED FURTHER that no Lender shall be required to use any
such efforts that are disadvantageous to such Lender in the sole opinion of such
Lender.
SECTION 4.12 INCREASED COSTS. If (i) Regulation D of the Board of
Governors of the Federal Reserve System, or (ii) after the date hereof, the
adoption of any applicable Law or treaty or any change in any applicable Law or
treaty or any change in the interpretation or administration thereof by any
governmental authority, central bank or comparable agency charged with the
interpretation or administration thereof, or compliance by any Lender (or any
office of such Lender designated from time to time by such Lender as the office
which shall be making or maintaining the Eurodollar Loans of such Lender
hereunder or through which such Lender will be determining its Eurodollar
Interest Rate (herein called a "EURODOLLAR OFFICE"))
44
with any request or directive (whether or not having the force of law) of any
such authority, central bank or comparable agency:
(a) shall subject any Lender (or any Eurodollar Office of such
Lender) to any tax, levy, impost, fee, duty, assessment or
other charge with respect to its Eurodollar Loans, its Notes
or its obligation to make Eurodollar Loans, or shall change
the basis of taxation of payments to any Lender of the
principal of or interest on its Eurodollar Loans or any other
amounts due under this Agreement in respect of its Eurodollar
Loans or its obligation to make Eurodollar Loans (except for
changes in the rate of tax imposed on or measured by the
overall net income or receipts of such Lender or its
Eurodollar Office imposed by the jurisdiction in which such
Lender's principal office or its Eurodollar Office is
located); or
(b) shall impose, modify or deem applicable any reserve
(including, without limitation, any reserve imposed by the
Board of Governors of the Federal Reserve System, but
excluding any reserve included in the determination of the
Eurodollar Interest Rate pursuant to SECTION 1.1), special
deposit, special assessment or similar capital requirement
against assets of, deposits with or for the account of, or
credit extended by, any Lender (or any Eurodollar Office of
such Lender); or
(c) shall impose on any Lender (or its Eurodollar Office) any
other condition affecting this Agreement, its Eurodollar
Loans, its Notes or its obligation to make Eurodollar Loans,
and the result of any of the foregoing is to increase the cost to (or in the
case of Regulation D referred to above, to impose a cost on) such Lender (or any
Eurodollar Office of such Lender) of making or maintaining any Eurodollar Loan,
or to reduce the amount of any sum received or receivable by such Lender (or any
Eurodollar Office of such Lender) under this Agreement or under its Notes with
respect thereto, then within fifteen (15) days after demand by such Lender
(which demand shall be accompanied by a certificate setting forth the basis of
such demand and including calculations in reasonable detail), the Borrower shall
pay directly to such Lender such additional amount or amounts as will compensate
such Lender for such costs or expenses. The Borrower will not be responsible for
paying any amounts pursuant to this SECTION 4.12 accruing prior to 180 days
prior to the receipt by the Borrower of the certificate referred to in the
preceding sentence. Any certificate as to any such cost or expense submitted by
such Lender to the Borrower shall be rebuttable presumptive evidence of such
cost or expense. In determining such amount, any Lender may use any method of
averaging and attribution that it (in its sole and absolute discretion) shall
deem applicable.
SECTION 4.13 DISCRETION OF THE LENDERS AS TO MANNER OF FUNDING.
Notwithstanding any provision of this Agreement to the contrary, each Lender
shall be entitled to fund and maintain its funding of all or any part of its
Loans in any manner it sees fit, it being
45
understood, however, that for the purposes of this Agreement all determinations
hereunder shall be made as if such Lender had actually funded and maintained
each Eurodollar Loan during each Eurodollar Interest Period for such Eurodollar
Loan through the purchase of deposits having a maturity corresponding to such
Eurodollar Interest Period and bearing an interest rate equal to the Eurodollar
Interest Rate for such Eurodollar Interest Period. It is understood by the
parties hereto that this SECTION 4.13 is not intended to, nor shall it be
construed so as to, relieve any Lender of any obligation to make a Loan
hereunder pursuant to the other provisions of this Agreement.
SECTION 4.14 EURODOLLAR LOAN-RELATED INDEMNIFICATION PROVISIONS. UPON
DEMAND BY ANY LENDER, THE BORROWER SHALL INDEMNIFY SUCH LENDER AGAINST ANY
ACTUAL LOSS OR EXPENSE WHICH SUCH LENDER MAY SUSTAIN OR INCUR (BUT NOT ANY
PENALTY OR PREMIUM), AS A CONSEQUENCE OF (I) THE BORROWER'S FAILURE TO MAKE A
PRINCIPAL OR INTEREST PAYMENT WITH RESPECT TO ANY EURODOLLAR LOANS ON THE DUE
DATE THEREOF, (II) ANY PAYMENT, PREPAYMENT (MANDATORY OR OPTIONAL) OR CONVERSION
OF EURODOLLAR LOANS BY THE BORROWER ON ANY DATE OTHER THAN ON THE LAST DAY OF
ANY RELEVANT EURODOLLAR INTEREST PERIOD, (III) ANY FAILURE BY THE BORROWER TO
BORROW, CONTINUE, CONVERT INTO OR PREPAY A EURODOLLAR LOAN ON THE DATE FOR SUCH
BORROWING, CONTINUATION, CONVERSION OR PREPAYMENT SPECIFIED IN THE RELEVANT
BORROWING REQUEST, OR NOTICE OF CONVERSION, CONTINUATION OR PREPAYMENT MADE BY
THE BORROWER TO THE ADMINISTRATIVE AGENT, (IV) ANY CONVERSION ON ANY DATE OTHER
THAN ON THE LAST DAY OF ANY RELEVANT EURODOLLAR INTEREST PERIOD BY REASON OF THE
OPERATION OF SECTION 4.7 OR 4.8, OR (V) SUCH LENDER'S BEING A DECLINING LENDER
OR REDUCED DECLINING LENDER AS PROVIDED IN SECTION 2.7(C) OR SUCH LENDER BEING
REPLACED PURSUANT TO SECTION 4.15, INCLUDING IN ALL INSTANCES, BUT NOT LIMITED
TO, ANY LOSS OR EXPENSE SUSTAINED OR INCURRED IN LIQUIDATING OR EMPLOYING
DEPOSITS FROM THIRD PARTIES ACQUIRED TO EFFECT, FUND OR MAINTAIN SUCH EURODOLLAR
LOANS OR ANY PART THEREOF. A certificate from a Lender as to the amount of any
such loss or expense to such Lender, specifying the basis upon which such loss
or expense is computed (and including calculations in reasonable detail), shall,
in the absence of manifest error, be rebuttable presumptive evidence of such
loss or expense. Within fifteen (15) days after such certificate is furnished to
the Borrower, the Borrower will pay directly to such Lender such additional
amount or amounts as will compensate such Lender for such loss or expense.
SECTION 4.15 REPLACEMENT OF LENDER ON ACCOUNT OF INCREASED COSTS,
EURODOLLAR LENDING UNLAWFUL, RESERVE REQUIREMENTS, TAXES, CERTAIN DISSENTS, ETC.
If any Lender is owed increased costs under SECTION 2.6 above, if any Lender
shall claim the inability to make or maintain Eurodollar Loans pursuant to
SECTION 4.8 above, if any Lender is owed any cost or expense pursuant to SECTION
4.9 or 4.12 above, if any payment to any Lender by the Borrower is subject to
any withholding tax pursuant to SECTION 4.10, or if any Lender does not agree to
an amendment, modification, waiver or consent, the Borrower shall have the
right, if no Event of Default or Unmatured Event of Default then exists, to
replace such Lender with another bank or financial institution PROVIDED that (i)
if it is not a Lender or an affiliate thereof, such bank or financial
institution shall be reasonably acceptable to the Agents and the Issuing Bank
and (ii) such bank or financial institution shall unconditionally offer in
writing (with a copy to the Administrative Agent and the Documentation Agent) to
purchase, in accordance with SECTION
46
14.6 hereof and Section 7.5(i) of the Participation Agreement, all of such
Lender's rights and obligations under this Agreement and the Notes and the
appropriate PRO RATA share of such Lender's A-Notes, Lessor's A-Invested Amount,
B-Notes, and Lessor's B-Invested Amount, without recourse or expense to, or
warranty by, such Lender being replaced for a purchase price equal to the
aggregate outstanding principal amount of the Note payable to such Lender PLUS
such Lender's Percentage of any outstanding Reimbursement Obligation, PLUS any
accrued but unpaid interest on such Note and such Reimbursement Obligations PLUS
the principal and stated amount of such A-Notes, Lessor's A-Invested Amount,
B-Notes, and Lessor's B-Invested Amount, PLUS any accrued but unpaid Fixed Rent,
PLUS accrued but unpaid fees in respect of such Lender's Borrowings and
Percentage of the Commitments hereunder to the date of such purchase on a date
therein specified. If such Lender accepts such purchase offer and such purchase
is consummated, the Borrower shall be obligated to pay, simultaneously with such
purchase and sale, the increased costs, amounts, expenses and taxes under
SECTIONS 2.6, 4.8, 4.9, 4.10, and 4.12 above, all breakage fees payable under
SECTION 4.14 and all other costs, fees and expenses payable to such Lender
hereunder and under the Operative Documents and under the Operative Loan
Documents (as defined in the Operative Documents), to the date of such purchase
as well as all other Obligations due and payable to or for the benefit of such
Lender; PROVIDED, that (x) if such Lender accepts such an offer and such bank or
financial institution fails to purchase such rights and obligations on such
specified date in accordance with the terms of such offer, the Borrower shall
continue to be obligated to pay the increased costs, amounts, expenses and taxes
under SECTIONS 2.6, 4.8, 4.9, 4.10 and 4.12 above to such Lender and (y) if such
Lender fails to accept such purchase offer, the Borrower shall not be obligated
to pay such Lender such increased costs pursuant to SECTIONS 2.6, 4.8, 4.9, 4.10
and 4.12 above from and after the date of such purchase offer.
SECTION 4.16 MAXIMUM INTEREST. It is the intention of the parties hereto
to conform strictly to applicable usury laws and, anything herein to the
contrary notwithstanding, the obligations of the Borrower to each Lender under
this Agreement shall be subject to the limitation that payments of interest
shall not be required to the extent that receipt thereof would be contrary to
provisions of law applicable to such Lender limiting rates of interest which may
be charged or collected by such Lender. Accordingly, if the transactions
contemplated hereby would be usurious under applicable law (including the
Federal and state laws of the United States of America, or of any other
jurisdiction whose laws may be mandatorily applicable) with respect to a Lender
then, in that event, notwithstanding anything to the contrary in this Agreement,
it is agreed as follows:
(a) the provisions of this SECTION 4.16 shall govern and control;
(b) the aggregate of all consideration which constitutes interest
under applicable law that is contracted for, charged or
received under this Agreement, or under any of the other
aforesaid agreements or otherwise in connection with this
Agreement by such Lender shall under no circumstances exceed
the maximum amount of interest allowed by applicable law (such
maximum lawful interest rate, if any, with respect
47
to such Lender herein called the "HIGHEST LAWFUL RATE"), and
any excess shall be credited to the Borrower by such Lender
(or, if such consideration shall have been paid in full, such
excess refunded to the Borrower);
(c) all sums paid, or agreed to be paid, to such Lender for the
use, forbearance and detention of the indebtedness of the
Borrower to such Lender hereunder shall, to the extent
permitted by applicable law, be amortized, prorated, allocated
and spread throughout the full term of such indebtedness until
payment in full so that the actual rate of interest is uniform
throughout the full term thereof; and
(d) if at any time the interest provided pursuant to SECTION 4.1
together with any other fees payable pursuant to this
Agreement and deemed interest under applicable law, exceeds
that amount which would have accrued at the Highest Lawful
Rate, the amount of interest and any such fees to accrue to
such Lender pursuant to this Agreement shall be limited, not
withstanding anything to the contrary in this Agreement to
that amount which would have accrued at the Highest Lawful
Rate, but any subsequent reductions, as applicable, shall not
reduce the interest to accrue to such Lender pursuant to this
Agreement below the Highest Lawful Rate until the total amount
of interest accrued pursuant to this Agreement and such fees
deemed to be interest equals the amount of interest which
would have accrued to such Lender if a varying rate per annum
equal to the interest provided pursuant to SECTION 4.1 had at
all times been in ef fect, PLUS the amount of fees which would
have been received but for the effect of this SECTION 4.16.
For purposes of Article 5069-1.04, Vernon's Texas Civil Statutes, as amended, to
the extent, if any, applicable to a Lender, the Borrower agrees that the Highest
Lawful Rate shall be the "indicated (weekly) rate ceiling" as defined in said
Article, provided that such Lender may also rely, to the extent permitted by
applicable laws, on alternative maximum rates of interest under other laws
applicable to such Lender if greater.
Tex. Rev. Civ. Stat. Xxx. Art. 0000, Xx. 15 (which regulates certain
revolving credit loan accounts and revolving tri-party accounts) shall not apply
to this Agreement or the Notes.
48
ARTICLE V
REDUCTION OR TERMINATION
OF THE COMMITMENTS; PREPAYMENTS
SECTION 5.1 VOLUNTARY REDUCTION OR TERMINATION OF THE COMMITMENTS. The
Borrower may from time to time on at least three (3) Business Days' prior
written or telegraphic notice received by the Administrative Agent (which shall
promptly advise each Lender thereof) permanently reduce the Commitment Amount or
the Letter of Credit Commitment Amount (such reduction to be made PRO RATA among
the Lenders according to their respective Percentages) but only upon repayment
of the amount, if any, by which the aggregate outstandings under such facility
exceeds the then reduced Commitment Amount in accordance with SECTION 5.7;
PROVIDED, HOWEVER, that (i) if as a result thereof, the Borrower shall prepay
Eurodollar Loans on any day other than the last day of the relevant Eurodollar
Interest Period for such Eurodollar Loans then it shall also pay any loss or
expense pursuant to SECTION 4.14 and (ii) any permanent reduction shall be in a
minimum principal amount of $5,000,000 and in integral multiples of $100,000.
The Borrower may at any time on like notice, terminate all of the Commitments
upon payment in full of the Notes, all other Obligations with respect to the
Loans and all Letter of Credit Liabilities (including, without limitation, all
increased costs pursuant to SECTION 2.6, breakage fees pursuant to SECTION 4.14
and all other fees, costs and expenses) owing under this Agreement.
Additionally, any election by the Borrower to reduce the Total Committed Amount
pursuant to SECTION 2.7(C)(I), (II) or (III) shall be deemed to be a permanent
reduction of the Total Committed Amount and the Commitment Amount (such
reduction to be made among the Accepting Lenders and the Reduced Declining
Lenders according to such SECTION 2.7(C)(I), (II) or (III), as the case may be).
SECTION 5.2 VOLUNTARY PREPAYMENTS. The Borrower may from time to time,
upon at least one (1) Business Day for Domestic Loans and three (3) Business
Days for Eurodollar Loans prior written or telegraphic notice received by the
Administrative Agent (which shall promptly advise each Lender thereof), prepay
the Loans in whole or in part, without premium or penalty; PROVIDED, HOWEVER,
that the Borrower may only prepay Eurodollar Loans in whole or in part on the
last day of the relevant Eurodollar Interest Period for such Eurodollar Loan
UNLESS the Borrower pays all losses and expenses pursuant to SECTION 4.14 and
PROVIDED FURTHER after giving effect to such prepayment, the outstanding
Eurodollar Loans, if any, having a Eurodollar Interest Period ending on the same
date, if any, shall be in a minimum principal amount of $5,000,000. Any
voluntary partial prepayment shall be in a minimum principal amount of
$1,000,000 and in integral multiples of $100,000. Any voluntary prepayment of
principal of the Loans shall include accrued interest to the date of prepayment
on the principal amount being prepaid.
SECTION 5.3 MANDATORY SCHEDULED REDUCTIONS OF THE COMMITMENT AMOUNT. On
the last Business Day of each calendar quarter, commencing on the Initial
Commitment Amortization Date and continuing until the Commitment Termination
Date, the Commitment Amount shall, without any further action, automatically and
permanently be reduced by
49
$8,593,750, provided, however, that on the Commitment Termination Date, the
Commitment Amount shall be zero.
SECTION 5.4 [INTENTIONALLY OMITTED].
SECTION 5.5 MANDATORY PREPAYMENTS AND REDUCTION OF COMMITMENT AMOUNT ON
ACCOUNT OF ASSET TRANSFERS.
(i) If, at any time and from time to time after the date hereof,
the Borrower or any of its Subsidiaries shall Transfer any
Asset as permitted by SECTION 9.3.8(II), the Commitment Amount
shall be automatically and permanently reduced (1) on the
earlier to occur of (A) five (5) Business Days after the date
of receipt by the Borrower or any Subsidiary of the Borrower
of the consideration on account of such Transfer (other than a
Transfer pursuant to the exercise of an Option to Purchase)
and (B) the date which is 15 days after the date of such
Transfer and (2) on the earlier to occur of (A) five (5)
Business Days after the date of receipt by the Borrower or any
Subsidiary of the Borrower of the consideration due on account
of any such Transfer made pursuant to the exercise of an
Option to Purchase or (B) the date which is 25 days after the
date of any such Transfer made pursuant to the exercise of an
Option to Purchase. Such mandatory reduction of the Commitment
Amount shall be in an amount equal to the Net Proceeds
received or to be received from such Transfer or, if such
Transfer is to an Affiliate of the transferor, the higher of
(x) the Fair Market Value of the Asset so transferred and (y)
the Net Proceeds received or to be received.
(ii) On each date when a reduction in the Commitment Amount
pursuant to this SECTION 5.5 is effective, the Borrower shall
make any and all prepayments required by SECTION 5.7.
SECTION 5.6 [INTENTIONALLY OMITTED].
SECTION 5.7 MANDATORY PREPAYMENTS ON ACCOUNT OF LOANS AND LETTERS OF
CREDIT EXCEEDING COMMITMENT AMOUNTS. In the event the aggregate outstanding
principal amount of the Loans shall at any time exceed the Loan Commitment
Amount, the Borrower shall immediately prepay the Loans in an amount equal to
such excess. In the event the aggregate of Letter of Credit Liabilities exceeds
the Letter of Credit Commitment Amount, the Borrower shall either reduce the
Letter of Credit Liabilities by an amount equal to such excess or deposit cash
collateral with the Collateral Agent on account of and to secure its Obligations
with respect to Letters of Credit then in effect and not otherwise fully
collateralized pursuant to SECTION 2.4.4, such cash deposits to be in an amount
equal to such excess. In addition, in the event the sum of the aggregate
outstanding principal amount of the Loans plus the aggregate amount of all
Letter of Credit Liabilities then outstanding exceeds the Commitment Amount, the
50
Borrower shall first make a mandatory prepayment of the outstanding principal
amount of the Loans, and second, deposit cash collateral with the Collateral
Agent on account of and to secure its Obligations with respect to the Letters of
Credit then in effect and not otherwise fully collateralized pursuant to SECTION
2.4.4, such prepayments and/or cash deposits to be in an aggregate amount equal
to such excess.
ARTICLE VI
CONVERSION OF LOANS BETWEEN
EURODOLLAR LOANS AND DOMESTIC LOANS
On any Eurodollar Business Day, the Borrower may convert any outstanding
Domestic Loans into Eurodollar Loans or any outstanding Eurodollar Loans into
Domestic Loans; PROVIDED, HOWEVER, that (i) no such conversion of any Eurodollar
Loan into a Domestic Loan may be made except on the last day of the relevant
Eurodollar Interest Period for such Eurodollar Loan UNLESS the Borrower pays all
losses and expenses pursuant to SECTION 4.14, (ii) any conversion of a Domestic
Loan into a Eurodollar Loan shall be preceded by written notice from the
Borrower that it elects such conversion, which notice shall contain the
information required in SECTION 2.3.2 and shall be received by the
Administrative Agent by 11:00 a.m. (Chicago time) at least three (3) Eurodollar
Business Days prior to the date requested for such conversion (or four (4)
Eurodollar Business Days in the case of a Eurodollar Loan having a twelve (12)
month Eurodollar Interest Period) (and the Administrative Agent shall advise
such Lender thereof promptly thereafter), (iii) except as provided in Section
4.7, the Lenders shall not be obligated to effect any conversion into Eurodollar
Loans hereunder so long as any Unmatured Event of Default or any Event of
Default has occurred and is continuing, and (iv) after giving effect to each
conversion, Eurodollar Loans having a Eurodollar Interest Period ending on the
same date, if any, shall be in a minimum principal amount of $5,000,000.
ARTICLE VII
MAKING AND PRORATION OF PAYMENTS; OFFSET
SECTION 7.1 MAKING OF PAYMENTS. Unless otherwise expressly provided, all
payments (including those made pursuant to the provisions of ARTICLE V) by the
Borrower under this Agreement, the Notes or any other Loan Document shall be
made, without setoff, deduction or counterclaim, in immediately available funds
by the Borrower to the Administrative Agent at the Payment Office, for the PRO
RATA account of the Lenders entitled to receive such payment. All such payments
shall be made not later than 11:00 a.m. (Chicago time) at the place of payment,
on the date due; and funds received after that hour shall be deemed to have been
received by the Administrative Agent on the next succeeding Eurodollar Business
Day or Domestic Business Day, as the case may be. The Administrative Agent shall
promptly remit in same day funds to each Lender its share of all such payments
received by the Administrative Agent for the account of such Lender.
51
SECTION 7.2 PRORATION OF PAYMENTS. If any Lender or other holder of a Note
shall obtain any payment or other recovery (whether voluntary, involuntary, by
application of off set pursuant to applicable law or SECTION 7.3, or otherwise)
on account of all or part of its Loans or the Reimbursement Obligations owing to
it, or interest thereon, owing hereunder or under any other Loan Document (other
than any payment or recovery under SECTION 2.7(C), SECTION 4.9, SECTION 4.12,
SECTION 4.14, SECTION 4.15 or SECTION 14.6) in excess of such Lender's PRO RATA
share of payments and other recoveries then and therewith obtained by all
Lenders, then such Lender receiving such excess payment or other recovery shall
purchase for cash without recourse from the other Lenders participating
interests in the Obligations of the Borrower to such Lenders in such amount as
shall be necessary to cause such purchasing Lender to share such excess payment
or other recovery ratably with each of them; PROVIDED, HOWEVER, that if all or
any portion of the excess payment or other recovery is thereafter recovered from
such purchasing Lender or other holder, the purchase shall be rescinded and the
purchase price restored to the extent of such recovery, but without interest.
SECTION 7.3 OFFSET. In addition to and not in limitation of all rights of
offset that any Lender or other holder of a Note may have under applicable law,
to the fullest extent permitted by applicable law, each Lender shall, upon the
occurrence of any Event of Default, have the right to appropriate and apply to
the payment of such Note and any other Obligations any and all balances,
credits, deposits, accounts or moneys of the Borrower then or thereafter with
such Lender.
ARTICLE VIII
REPRESENTATIONS AND WARRANTIES
To induce the Lenders and the Issuing Bank to extend their Commitments
hereunder to make the Loans hereunder and to issue the Letters of Credit and
acquire participation therein hereunder, the Borrower represents and warrants to
the Administrative Agent, the Documentation Agent, the Collateral Agent, the
Issuing Bank and the Lenders that:
SECTION 8.1 ORGANIZATION, ETC. The Borrower and each Subsidiary of the
Borrower are each a corporation duly incorporated, a limited liability company
duly organized or a partnership duly formed, as the case may be, and are each
validly existing and in good standing (or, in the case of a partnership, validly
existing) under the laws of the state of its respective incorporation,
organization or formation; and the Borrower and each Subsidiary of the Borrower
are each duly qualified and in good standing as a foreign corporation, limited
liability company or partnership authorized to do business in each jurisdiction
where, because of the nature of its activities or properties, such qualification
is required and where the failure so to qualify would have a material adverse
effect on the consolidated business condition (financial or otherwise),
operations, performance or properties of the Borrower and its Subsidiaries
(taken as a whole).
52
SECTION 8.2 AUTHORIZATION; NO CONFLICT. The execution and delivery of this
Agreement, the Borrowings hereunder, the execution and delivery of the Notes and
the Loan Documents, and the performance by the Borrower and the other Obligors
of their respective Obligations under this Agreement, the Notes and the other
Loan Documents, are within the Borrower's and the other Obligors' corporate,
limited liability company, or partnership powers, as the case may be, have been
duly authorized by all necessary corporate, limited liability company or
partnership action, as the case may be, have received all necessary governmental
consents, authorizations, orders and approvals (if any shall be required), and
do not and will not contravene or conflict with any provision (a) of Law, (b) of
the charter, bylaws, certificate of formation, limited liability company
agreement or partnership agreement of the Borrower or any other Obligor, or (c)
of any material agreement binding upon the Borrower or any other Obligor or any
of them.
SECTION 8.3 VALIDITY AND BINDING NATURE. This Agreement is, and the Notes
and the Loan Documents when duly executed and delivered will be, legal, valid
and binding obligations of the Borrower and each other Obligor party thereto
enforceable against each of the Borrower and such other Obligors in accordance
with their respective terms subject as to enforcement only to bankruptcy,
insolvency, reorganization, moratorium or other similar laws affecting the
enforcement of creditors' rights generally and general principles of equity.
SECTION 8.4 REPRESENTATION WITH RESPECT TO FINANCIAL STATEMENTS.
(a) The audited consolidated financial statements of Transok,
Inc., dated as of December 31, 1995, and the related
consolidated statements of earnings and cash flow of the
Borrower and its Subsidiaries, copies of which have been
furnished to each Lender, have been prepared in conformity
with GAAP, and present fairly the consolidated financial
condition of the corporations and other entities covered
thereby as at the dates thereof and the results of operations
for the periods then ended.
(b) The unaudited financial statements of the Borrower dated as of
September 30, 1996, prepared on a consolidated and
consolidating basis signed by a duly authorized financial
officer of the Borrower and consisting of at least a balance
sheet as at the close of such quarter, statements of cash
flows and statements of earnings for such quarter, copies of
which have been furnished to each Lender, have been prepared
in conformity with GAAP, and present fairly the consolidated
and consolidating financial condition of the corporations and
other entities covered thereby as at the dates thereof and the
results of operations for the periods then ended and since
September 30, 1996, there has been no material adverse change
in the consolidated business condition (financial or
otherwise), operations, performance or properties of, the
Borrower and its Subsidiaries (taken as a whole).
53
SECTION 8.5 PENDING OR THREATENED LITIGATION AND CONTINGENT LIABILITIES.
No litigation (including, without limitation, derivative actions and take-or-pay
actions), arbitration proceedings or governmental proceedings are pending or to
the best knowledge of the Borrower and its Subsidiaries threatened against the
Borrower or any of its Subsidiaries which would, if adversely determined,
materially and adversely affect the consolidated business condition (financial
or otherwise), operations, performance or properties of the Borrower and its
Subsidiaries (taken as a whole) (excluding any rulemaking or similar proceedings
of general applicability to natural gas pipelines and any appeal or petition for
review related thereto) or continued operations of the Borrower and its
Subsidiaries, or which purports to affect the legality, validity or
enforceability of this Agreement, the Notes or any other Loan Document, except
as set forth in EXHIBIT 8.5.
SECTION 8.6 EXISTING LIENS. None of the Assets of the Borrower or any
Subsidiary of the Borrower is subject to any Lien except (i) for current taxes
not delinquent or taxes being contested in good faith and by appropriate
proceedings; (ii) liens arising in the ordinary course of business for sums not
due or sums being contested in good faith and by appropriate proceedings and not
involving any deposits or advances or borrowed money or the deferred purchase
price of property or services, including, but not limited to, reciprocal liens
customarily granted pursuant to joint venture agreements and joint operating
agreements to secure payment of joint operating costs, PROVIDED such costs are
directly related to the business and operations of the pertinent joint venture,
and liens imposed by law, such as mechanic's, materialman's, and carrier's liens
and liens arising in connection with customary pooling or unitization agreements
entered into by the Borrower or its Subsidiaries in the ordinary course of
business; (iii) liens (other than any lien imposed under ERISA) incurred or
deposits made in the ordinary course of business in connection with workers'
compensation, unemployment insurance and other types of social security or old
age pension benefits; (iv) any liens in favor of the Collateral Agent for the
benefit of the Lenders and liens created under the Security Documents; (v) liens
on real or personal property leased pursuant to leases permitted under SECTION
9.3.3(VI) for nondelinquent lease payments thereunder; (vi) severance tax liens
on purchased gas arising by operation of law; (vii) to the extent shown in the
financial statements referred to in SECTION 8.4; (viii) to the extent shown in
EXHIBIT 8.6; (ix) Options to Purchase granted in the ordinary course of
business; (x) liens permitted by SECTION 9.3.4; (xi) deposits of cash to secure
insurance in the ordinary course of business, the performance of bonds, tenders,
contracts (other than contracts for the payment of money), leases, licenses,
franchises, statutory obligations, surety and appeal bonds and performance bonds
and other obligations of a like nature incurred in the ordinary course of
business; (xii) easements, rights-of-way, covenants, reservations, exceptions,
encroachments, zoning and similar restrictions and other similar encumbrances or
title defects which, in the aggregate, are not substantial in amount, and which
do not in any case singly or in the aggregate materially detract from the value
or usefulness of the property subject thereto for the business conducted or
materially interfere with the ordinary conduct of the business of the Borrower
and its Subsidiaries; (xiii) bankers' liens arising by operation of law; (xiv)
Liens arising pursuant to any order of attachment, distraint or similar legal
process arising in connection with any court proceeding the payment of which is
covered in full (subject to customary deductibles) by insurance; (xv) inchoate
Liens arising under ERISA
54
to secure contingent liabilities of the Borrower and its Subsidiaries; (xvi)
rights of lessee and sublessee in property leased by the Borrower or any of its
Subsidiaries not prohibited elsewhere herein; and (xvii) Liens of record on
Assets acquired in connection with the Merger permitted in Section 4.06 of the
Merger Agreement.
SECTION 8.7 EXISTING SUBSIDIARIES. As of the date hereof, the Borrower has
no Subsidiaries and owns no interest in any other entity except those listed in
EXHIBIT 8.7. The Borrower has no Material Subsidiaries except those listed on
EXHIBIT 8.7 (as such exhibit may be deemed amended pursuant to SECTION 9.1.6).
SECTION 8.8 EXISTING EMPLOYEE BENEFIT PLANS. Each employee benefit plan
sponsored or maintained by the Borrower or any of its Subsidiaries for their
employees or former employees ("EMPLOYEE BENEFIT PLAN") complies in all material
respects with all applicable requirements of Law. No Reportable Event (as
defined in ERISA) for which the disclosure requirements under Regulation 2615.3
promulgated by the Pension Benefit Guaranty Corporation (the "PBGC") has not
been waived has occurred with respect to any Employee Benefit Plan that is
subject to Title IV of ERISA (hereinafter "PENSION PLAN") and there has been no
withdrawal from any such plan or steps taken to do so which has resulted or
could result in material liability for the Borrower or any of its Subsidiaries
under Title IV of ERISA.
SECTION 8.9 INVESTMENT COMPANY ACT REPRESENTATION. Neither the Borrower
nor any of its Subsidiaries is an "investment company" or a company "controlled"
by an "investment company," within the meaning of the Investment Company Act of
1940, as amended.
SECTION 8.10 PUBLIC UTILITY HOLDING COMPANY ACT REPRESENTATION. Neither
the Borrower nor any of its Subsidiaries is a "holding company," or a
"subsidiary company" of a "holding company," or an "affiliate" of a "holding
company" or of a "subsidiary company" of a "holding company," within the meaning
of the Public Utility Holding Company Act of 1935, as amended.
SECTION 8.11 REPRESENTATION WITH RESPECT TO REGULATIONS G, T, U AND X. No
part of the proceeds of the Borrowings will be used to purchase or carry Margin
Stock in violation of Regulation G, T, U or X, nor will the execution,
performance or delivery by the Borrower of the Notes or the Security Documents,
or the execution, performance and delivery by any Guarantor of its respective
Guaranty and of those Security Documents to which such Guarantor is a party, nor
the application of the proceeds of the Borrowings in accordance herewith,
violate Regulation G, T, U or X. Neither the Borrower nor any of its
Subsidiaries is engaged principally, or as one of its important activities in
the business of extending credit for the purpose of buying or carrying Margin
Stock, and both before and after giving effect to all of the transactions
contemplated herein, and the purchases and acquisitions permitted under Section
9.3.2, and application of the proceeds of any Borrowings, less than 25% of the
Assets of each of the Borrower and each of its Subsidiaries consists of Margin
Stock.
55
SECTION 8.12 REPRESENTATION WITH RESPECT TO TRUE AND COMPLETE DISCLOSURE.
To the best of the Borrower's knowledge and belief, all factual information
heretofore or contemporaneously furnished by or on behalf of the Borrower, any
Subsidiary of the Borrower, the Holding Company or the Parent Company to any
Lender, the Issuing Bank, the Documentation Agent, the Collateral Agent or the
Administrative Agent for purposes of or in connection with this Agreement or any
transaction contemplated hereby is, and all other such factual information
hereafter furnished by or on behalf of the Borrower, any Subsidiary of the
Borrower, the Holding Company or the Parent Company to any Lender, the Issuing
Bank, the Collateral Agent, the Documentation Agent or the Administrative Agent
will be, true and accurate (taken as a whole) on the date as of which such
information is dated or certified and does not omit any material fact necessary
to make such information (taken as a whole) not misleading at such time.
SECTION 8.13 STATUS OF TITLE TO ASSETS. The Borrower and each of its
Subsidiaries have valid title to, or valid leasehold interest in, all of the
Assets of the Borrower and its Subsidiaries, free and clear of liens, burdens
and imperfections other than such imperfections or other burdens of title to
such Assets as do not in the aggregate materially detract from the value thereof
to, or for the use thereof in, their businesses (taken as a whole), the Liens
permitted by SECTION 9.3.4 and Options to Purchase granted in the ordinary
course of business.
SECTION 8.14 TAXES. The Borrower and each of its Subsidiaries has to the
best knowledge of the Borrower filed all tax returns or extensions and reports
required by law to have been filed by them and have paid all taxes and
governmental charges thereby shown to be owing, except such taxes or charges
which are being contested in good faith by appropriate proceedings and for which
adequate reserves in accordance with GAAP shall have been set aside on their
respective books and except for taxes and governmental charges, and any tax
returns, extensions, reports or audits in connection therewith, disclosed in
EXHIBIT 8.14 and except for Taxes for which the Parent Company is fully
indemnified under Section 8.03 of the Merger Agreement.
SECTION 8.15 UNCONDITIONAL PURCHASE OBLIGATIONS. Except as permitted in
SECTION 9.3.9, neither the Borrower nor any of its Subsidiaries has entered
into, is a party to, or has any obligations under, any material contract for the
purchase of materials, supplies or other property or services, if such contract
requires that payment be made by it regardless of whether or not delivery is
ever made of such materials, supplies or other property or services.
SECTION 8.16 ENVIRONMENTAL WARRANTIES. Except as set forth in EXHIBIT 8.16
and except for matters for which the Parent Company is fully indemnified
(subject to the dollar limitations set forth in Section 8.01 or Section 8.02 of
the Merger Agreement) pursuant to such Section 8.01 or Section 8.02.:
(a) to the best knowledge of the management of the Borrower, all
facilities and property (including underlying groundwater)
owned, leased or
56
operated by the Borrower or any of its Subsidiaries have been,
and continue to be, owned, leased or operated by the Borrower
and its Subsidiaries in material compliance with all
Environmental Laws except where such failure to comply singly
or in the aggregate, will not have or reasonably be expected
to have, a material adverse effect on the consolidated
business condition (financial or otherwise), operations,
performance or properties of the Borrower and its Subsidiaries
(taken as a whole);
(b) to the best knowledge of the Borrower, there have been no
past, and there are no pending or threatened
(i) claims, complaints, notices or inquiries to, or requests
for information received by, the Borrower or any of its
Subsidiaries with respect to any alleged violation of
any Environmental Law, except where such violation
singly or in the aggregate, will not have, or reasonably
be expected to have, a material adverse effect on the
consolidated business condition (financial or
otherwise), operations, performance or properties of the
Borrower and its Subsidiaries (taken as a whole) or
(ii) claims, complaints, notices or inquiries to, or requests
for information received by, the Borrower or any of its
Subsidiaries regarding potential liability under any
Environmental Law or under any common law theories
relating to operations or the condition of any
facilities or property (including underlying
groundwater) owned, leased or operated by the Borrower
or any of its Subsidiaries that, singly or in the
aggregate, have, or may reasonably be expected to have,
a material adverse effect on the consolidated business
condition (financial or otherwise), operations,
performance or properties of the Borrower and its
Subsidiaries (taken as a whole);
(c) to the best knowledge of the management of the Borrower, there
have been no Releases of Hazardous Materials at, on or under
any property now or previously owned or leased by the Borrower
or any of its Subsidiaries that, singly or in the aggregate,
have, or may reasonably be expected to have, a material
adverse effect on the consolidated business condition
(financial or otherwise), operations, performance or
properties of the Borrower and its Subsidiaries (taken as a
whole);
(d) the Borrower and its Subsidiaries have been issued and are in
material compliance with all permits, certificates, approvals,
licenses and other authorizations relating to environmental
matters and necessary or desirable
57
for their businesses, except where failure to have been so
issued or comply, singly or in the aggregate, will not have,
or reasonably be expected to have, a material adverse effect
on the consolidated business condition (financial or
otherwise), operations, performance or properties of the
Borrower and its Subsidiaries (taken as a whole);
(e) no property now (or to the best knowledge of the management of
the Borrower previously) owned, leased or operated by the
Borrower or any of its Subsidiaries is listed or proposed for
listing on the National Priorities List pursuant to CERCLA, on
the CERCLIS or on any other similar state list of sites
requiring investigation or clean-up;
(f) to the best knowledge of the Borrower, there are no
underground storage tanks, active or abandoned, including
petroleum storage tanks, on or under any property now or
previously owned, leased or operated by the Borrower or any of
its Subsidiaries that, singly or in the aggregate, have, or
may reasonably be expected to have, a material adverse effect
on the consolidated business condition (financial or
otherwise), operations, performance or properties of the
Borrower and its Subsidiaries (taken as a whole);
(g) to the best knowledge of the Borrower, neither the Borrower
nor any Subsidiary of the Borrower has directly transported or
directly arranged for the transportation of any Hazardous
Material to any location which is listed or proposed for
listing on the National Priorities List pursuant to CERCLA, on
the CERCLIS or on any similar state list or which is the
subject of federal, state or local enforcement actions or
other investigations which may lead to material claims against
the Borrower or such Subsidiary thereof for any remedial work,
damage to natural resources or personal injury, including
claims under CERCLA;
(h) to the best knowledge of the Borrower, there are no
polychlorinated biphenyls, radioactive materials or friable
asbestos present at any property now or previously owned or
leased by the Borrower or any Subsidiary of the Borrower that,
singly or in the aggregate, have, or may reasonably be
expected to have, a material adverse effect on the
consolidated business condition (financial or otherwise),
operations, performance or properties of the Borrower and its
Subsidiaries (taken as a whole); and
(i) no conditions exist at, on or under any property now or
previously owned or leased by the Borrower or any Subsidiary
of the Borrower which would have a material adverse effect on
the consolidated business condition (financial or otherwise),
operations, performance or properties of the
58
Borrower and its Subsidiaries (taken as a whole) arising out
of liability under any Environmental Law.
SECTION 8.17 REGULATORY COMPLIANCE. The Borrower and each of its
Subsidiaries is in possession of, and is operating in compliance with, all
franchises, grants, authorizations, approvals, licenses, permits, consents,
certificates and orders required to own, lease or use their respective Assets
(including, without limitation, those required to be obtained from the Railroad
Commission of Texas, the Federal Energy Regulatory Commission, the Oklahoma
Corporation Commission and any successor agencies) and to permit the conduct of
its business as now conducted and as proposed to be conducted, except (i) for
those franchises, grants, authorizations, approvals, licenses, permits,
consents, certificates and orders which are routine or administrative in nature
and are expected in the reasonable judgment of the Borrower to be obtained or
given in the ordinary course of business after the Closing Date, (ii) where
failure to so possess, or operate in compliance with, such franchises, grants,
authorizations, approvals, licenses, permits, consents, certificates and orders
would not singly or in the aggregate have, and could not reasonably be expected
to have, a material adverse effect on the consolidated business condition
(financial or otherwise), operations, performance or properties of the Borrower
and its Subsidiaries (taken as a whole), (iii) as disclosed in EXHIBIT 8.17 and
(iv) matters for which the Parent Company is fully indemnified (subject to the
dollar limitations set forth in Section 8.01 and Section 8.02 of the Merger
Agreement) pursuant to such Section 8.01 or Section 8.02. The Borrower, each of
its Subsidiaries and their respective Assets are in compliance with all
applicable statutes and regulations of, and all applicable restrictions imposed
by, all governmental authorities and regulatory bodies (including, without
limitation, the Federal Energy Regulatory Commission, the Railroad Commission of
Texas, the Oklahoma Corporation Commission and any successor agencies) except
(i) where failure to so comply would not singly or in the aggregate have, and
could not reasonably be expected to have, a material adverse effect on the
consolidated business condition (financial or otherwise), operations,
performance or properties of the Borrower and its Subsidiaries (taken as a
whole) and (ii) as specifically disclosed in EXHIBIT 8.17 and matters for which
the Parent Company is fully indemnified (subject to the dollar limitations set
forth in Section 8.01 and Section 8.02 of the Merger Agreement) pursuant to such
Section 8.01 or Section 8.02.
ARTICLE IX
BORROWER'S COVENANTS
Until the expiration or termination of the Commitments of the Lenders
hereunder and thereafter until all Obligations are paid and performed (other
than continuing indemnity obligations) in full, the Borrower agrees that, unless
at any time the Required Lenders shall consent in writing, it will observe or
cause to be observed, as the case may be, the following covenants, agreements
and obligations:
SECTION 9.1 REPORTS, CERTIFICATES AND OTHER INFORMATION. The Borrower will
furnish or cause to be furnished to each Lender and each Agent (or in the case
of the
59
information and documents described in SECTIONS 9.1.4 AND 9.1.6, to the
Administrative Agent with enough copies to provide one to each Agent and each
Lender or in the case of information requested by any Agent or any Lender
pursuant to SECTION 9.1.8, a copy for such requestor);
SECTION 9.1.1 AUDIT REPORT. Within one hundred twenty (120) days after the
end of each fiscal year of the Borrower, beginning with the fiscal year ended
December 31, 1996, a copy of an annual audit report of the Borrower, including
therein consolidated balance sheets of the Borrower and its Subsidiaries as of
the end of such fiscal year and consolidated statements of earnings of the
Borrower and its Subsidiaries for such fiscal year, and, consolidated statements
of cash flow for the Borrower and its Subsidiaries for such fiscal year, in
conformity with GAAP and, in the case of such annual audit reports for fiscal
years commencing with fiscal year ended December 31, 1996, applied on a basis
consistent with the audited consolidated financial statements of the Parent
Company as of December 31, 1995, duly certified by independent certified public
accountants of nationally recognized standing selected by the Borrower and
consisting of at least a balance sheet as of the close of such fiscal year,
statements of cash flow and statements of earnings for such fiscal year. Such
annual audit reports shall be accompanied by a certificate (which certificate
shall not be part of such audit report) from a duly authorized financial officer
of the Borrower showing compliance with SECTION 9.4 and containing a statement
by such authorized officer that in examining the financial statements and the
covenants contained in SECTION 9.4 such authorized officer did not become aware
of any Event of Default or Unmatured Event of Default, or if the authorized
officer has become aware of any such event, describing it and the steps, if any,
being taken to cure it.
SECTION 9.1.2 INTERIM FINANCIAL REPORTS. Within seventy-five (75) days
after the end of the first three fiscal quarters of each fiscal year, commencing
with the fiscal quarter ending September 30, 1996, copies of the unaudited
financial statements of the Borrower prepared on a consolidated and
consolidating basis and in the same manner as the audit report referred to in
SECTION 9.1.1 (except that allocation of taxes need not be shown on such
quarterly unaudited consolidating financial statements), signed by a duly
authorized financial officer of the Borrower and consisting of at least a
balance sheet as at the close of such quarter, statements of cash flows and
statements of earnings for such quarter. Such quarterly financial statements
shall be accompanied by a certificate (which certificate shall not be part of
such quarterly financial statements) from a duly authorized financial officer of
the Borrower, and showing compliance with SECTION 9.4 and containing a statement
by such authorized officer that in examining the financial statements and the
covenants contained in SECTION 9.4 such authorized officer did not become aware
of any Event of Default or Unmatured Event of Default, or if the authorized
officer has become aware of any such event, describing it and the steps, if any,
being taken to cure it.
SECTION 9.1.3 COMPLIANCE CERTIFICATES. Concurrently with the delivery of
the reports described in SECTIONS 9.1.1 and 9.1.2 and from time to time promptly
upon request by the Lenders, a compliance certificate substantially in the form
of EXHIBIT 9.1.3A or EXHIBIT 9.1.3B, as the case may be, duly executed by an
authorized financial officer of the Borrower, containing a computation of, and
showing compliance with, each of the financial
60
ratios and restrictions contained in SECTION 9.4 and containing a computation of
the Leverage Ratio, all such computations to be made as of the end of the
immediately preceding fiscal year if furnished concurrently with the report
described in SECTION 9.1.1, and as of the end of the immediately preceding
fiscal quarter if furnished concurrently with the report described in SECTION
9.1.2 or at the request of the Lenders.
SECTION 9.1.4 REPORTS TO SEC, SHAREHOLDERS AND OTHER REGULATORY AGENCIES.
Copies of (i) each material public filing and report made by the Borrower, any
of its Subsidiaries, the Parent Company or any Material Tejas Subsidiary with or
to any securities exchange or the Securities and Exchange Commission, (ii) as
may be reasonably requested by any Lender or any Agent, each material public
filing and report (other than routine operating reports) made by the Borrower or
any of its Subsidiaries, with or to any governmental authority or regulatory
body (including, without limitation, the Federal Energy Regulatory Commission,
the Railroad Commission of Texas, the Louisiana Public Service Commission, the
Louisiana Conservation Commission, the Oklahoma Corporation Commission and any
successor agencies), and (iii) other customarily provided material public
communications from the Borrower, any of its Subsidiaries, the Parent Company or
any Material Tejas Subsidiary, promptly upon the filing or making thereof.
SECTION 9.1.5 NOTICES RELATING TO DEFAULT, LITIGATION AND CERTAIN ERISA
MATTERS. Promptly upon learning of the occurrence of any of the following,
written notice thereof, describing the same and the steps being taken by the
Borrower or any of its Subsidiaries affected with respect thereto: (i) the
occurrence of an Event of Default or an Unmatured Event of Default, or (ii) the
institution of, or any adverse determination in, any litigation, arbitration
proceeding or governmental proceeding which in the opinion of Borrower's
management is or should reasonably be expected to be material to the Borrower
and its Subsidiaries on a consolidated basis. Promptly upon an officer of the
Borrower knowing of the occurrence of any of the following written notice
thereof, describing the same and the steps being taken by the Borrower or any of
its Subsidiaries affected with respect thereto: (i) the occurrence of a
Reportable Event (as defined in ERISA) for which the disclosure requirements
under Regulation 2615.3 promulgated by the PBGC have not been waived with
respect to a Pension Plan, (ii) the institution of steps to withdraw from, or
the institution of any steps to terminate, any Pension Plan of the Borrower, its
Subsidiaries or a corporation or other entity which together with the Borrower
or a Subsidiary of the Borrower is under common control or a member of an
affiliated service group or any other entity required to be aggregated with the
Borrower or a Subsidiary of the Borrower under Code Sections 414(b) or (c) as
modified by Code Section 414(h) or Code Sections 414(m) or (o) ("ERISA
AFFILIATE") or the failure to make a required contribution to any such plan if
such failure is sufficient to give rise to a Lien under section 302(f) of ERISA
or Section 412 of the Code, or (iii) the taking of any action with respect to
any such Pension Plan which could result in the requirement that the Borrower or
any of its Subsidiaries furnish a bond or other security to the PBGC or such
plan, or the occurrence of any event with respect to any such plan which could
result in material liability for the Borrower or any of its Subsidiaries.
61
SECTION 9.1.6 CHANGES IN MATERIAL SUBSIDIARIES. Within fifteen (15) days
after the formation, Activation, or acquisition of any Material Subsidiary or
upon the designation of a Material Subsidiary as such, a written report of any
changes in the list of its respective Material Subsidiaries which report shall
be deemed to be an amendment to EXHIBIT 8.7.
SECTION 9.1.7 PROJECTED CASH FLOW STATEMENTS. On or before September 30 of
each calendar year, commencing September 30, 1997, projected cash flow
statements, earnings forecasts and financial ratios, prepared on a consolidated
basis for the Borrower and its Subsidiaries, including, without limitation,
projected gas systems volumes, average gas spread, costs, capital expenditures,
cash flow from operations and debt retirement together with schedules containing
supporting data used in calculating the foregoing.
SECTION 9.1.8 OTHER INFORMATION. From time to time such other information
concerning the Borrower and its Subsidiaries as any Lender or any Agent may
reasonably request from the Borrower.
SECTION 9.2 AFFIRMATIVE COVENANTS. The Borrower will and will cause each
of its Subsidiaries to:
SECTION 9.2.1 BOOKS, RECORDS AND INSPECTIONS. Maintain complete and
accurate books and records; permit access by any Lender or any Agent to the
books and records of the Borrower and any of its Subsidiaries at such times
during normal business hours as such Lender or such Agent may reasonably
request; and permit any Lender or any Agent to inspect the properties and
operations of the Borrower and any of its Subsidiaries at such times during
normal business hours as such Lender or such Agent may reasonably request.
SECTION 9.2.2 INSURANCE. Maintain, directly or indirectly, with
responsible insurance companies such insurance with respect to their properties
and business as may be required by law and such other insurance, in such types
and amounts and against such hazards and liabilities, as is customarily
maintained by well-insured companies in the industry; and (i) furnish to any
Lender or any Agent promptly after a request by such Lender or such Agent during
any period an Event of Default shall have occurred and be continuing, but in no
event more frequently than once per calendar quarter, a certificate from an
authorized officer of the Borrower setting forth all insurance maintained by the
Borrower and its Subsidiaries; PROVIDED, HOWEVER, that the Borrower may provide
to the Lender requesting such information any insurance certificate having
already been prepared by the Borrower within such calendar quarter pursuant to
this SECTION 9.2.2 and such certificate shall suffice for purposes of this
section, and (ii) on or before November 1st of each calendar year, furnish to
each Lender and each Agent a certificate from an authorized officer of the
Borrower setting forth in detail the insurance maintained by the Borrower and
its Subsidiaries.
SECTION 9.2.3 TAXES, ASSESSMENTS, ETC. Pay when due all taxes, assessments
and other governmental charges except as contested in good faith and by
appropriate proceedings and for which adequate reserves in accordance with GAAP
have been set aside on its books.
62
SECTION 9.2.4 MAINTENANCE OF EMPLOYEE BENEFIT PLANS. Maintain each
employee benefit plan as to which the Borrower or any of its Subsidiaries may
have any liability, in compliance in all material respects with all applicable
requirements of law and regulations.
SECTION 9.2.5 USE OF LOAN PROCEEDS AND LETTERS OF CREDIT. Use the proceeds
of the Loans hereunder and the Letters of Credit for general corporate purposes
including, without limitation, support of trade payables of the Borrower and its
Subsidiaries; PROVIDED, HOWEVER, that no part of the proceeds of the Loans or
any Letter of Credit will be used to purchase or carry any Margin Stock in
violation of Regulation G, T, U or X.
SECTION 9.2.6 TITLE TO PROPERTIES. Maintain at all times valid title to,
or valid leasehold or right-of-way interest, easement or license in, all their
respective Assets free and clear of Liens, burdens and imperfections other than
such imperfections or other burdens of title to such Assets as do not in the
aggregate materially detract from the value thereof to, or for the use thereof
in, the business of the Borrower and its Subsidiaries (taken as a whole), the
Liens permitted by SECTION 9.3.4 and Options to Purchase granted in the ordinary
course of business.
SECTION 9.2.7 NEW OR ACTIVATED SUBSIDIARIES; MATERIAL SUBSIDIARIES. Cause
any Subsidiary of the Borrower which Subsidiary (a) is a Material Subsidiary
that is formed, acquired, or Activated after the date hereof or (b) becomes a
Material Subsidiary after the date hereof, to become a Guarantor with respect
to, and jointly and severally liable with all other Guarantors for, all the
obligations under this Agreement and the Notes by executing and delivering to
the Lenders a guaranty substantially in the form of the Guaranties delivered
pursuant to SECTION 10.3 and an Intercompany Subordinated Demand Note
substantially in the form of the Intercompany Subordinated Demand Notes
delivered pursuant to SECTION 10.4 and by causing such Subsidiary's, as the case
may be, capital stock, partnership or membership interest therein to be pledged
pursuant to a Pledge Agreement delivered pursuant to SECTION 10.1 or a
Partnership/Limited Liability Company Security Agreement pursuant to SECTION
10.2, as appropriate; and cause any Subsidiary of the Borrower that is not a
Material Subsidiary and that owns directly any interest in a Guarantor to become
a Guarantor with respect to, and jointly and severally liable with all other
Guarantors, for all obligations under this Agreement and the Notes by executing
and delivering to the Lenders a guaranty substantially in the form of the
Guaranties delivered pursuant to SECTION 10.3. In addition, the Borrower may
cause any Subsidiary which is not a Material Subsidiary to become a Guarantor
hereunder by executing and delivering a Guaranty and an Intercompany
Subordinated Demand Note and by causing its capital stock, partnership or
membership interest to be pledged, all as provided in the foregoing sentence.
SECTION 9.2.8 ENVIRONMENTAL COVENANT. Use, operate and maintain all
respective facilities and properties of the Borrower and its Subsidiaries in
material compliance with all Environmental Laws, keep all necessary permits,
approvals, certificates, licenses and other authorizations relating to
environmental matters in effect and remain in material compliance therewith, and
handle all Hazardous Materials in material compliance with all applicable
Environmental Laws, and promptly cure or defend any actions and proceedings
relating to compliance with Environmental Laws, in each case where failure to do
so may reasonably be
63
expected to have a material adverse effect on the consolidated business
condition (financial or otherwise), operations, performance or properties of the
Borrower and its Subsidiaries (taken as a whole).
SECTION 9.2.9 COMPLIANCE WITH LAWS, ETC. Comply in all material respects
with, and own, operate and maintain the Borrower's and its Subsidiaries' Assets
in material compliance with, all applicable federal, state and local laws,
rules, regulations and orders, including, without limitation, compliance with
all applicable laws, rules, regulations and orders of the Federal Energy
Regulatory Commission, the Railroad Commission of Texas, the Oklahoma
Corporation Commission, and any successor agencies; and obtain, maintain in full
force and effect, and comply in all material respects with all applicable
authorizations, consents, approvals, licenses, rulings, permits, tariffs, rates,
certifications, exemptions and filings required by any governmental authority
or regulatory body (including, without limitation, the Federal Energy Regulatory
Commission, the Railroad Commission of Texas, the Oklahoma Corporation
Commission, and any successor agencies) as shall now or hereafter be necessary
under applicable laws, ordinances, regulations or any interpretation or
administration thereof in connection with the ownership, operation and
maintenance of the Assets of the Borrower and its Subsidiaries; and in each case
where non-compliance therewith may reasonably be expected to have a material
adverse effect on the consolidated business condition (financial or otherwise),
operations, performance or properties of the Borrower and its Subsidiaries
(taken as a whole).
SECTION 9.2.10 [Intentionally Omitted].
SECTION 9.2.11 INDEMNITY. The Borrower from time to time and on a timely
basis and in accordance with appropriate procedures will enforce its rights to
the indemnities provided in Article VIII of the Merger Agreement.
SECTION 9.3 NEGATIVE COVENANTS. The Borrower will:
SECTION 9.3.1 RESTRICTIONS ON REDEMPTION AND PURCHASE OF SECURITIES AND
PAYMENT OF DIVIDENDS; ISSUANCE OF CAPITAL STOCK. Not, and not permit any of its
Subsidiaries to, redeem, purchase or otherwise acquire any shares of the capital
stock of the Borrower or any Subsidiary of the Borrower other than as permitted
by SECTION 9.3.6, and not declare or pay any dividends on the capital stock of
the Borrower (other than stock dividends), make any distribution or (except for
payments on Indebtedness permitted pursuant to SECTION 9.3.3(V),(IX), (XV),
(XIX) or (XXIII)) payment to stockholders, or set aside any funds for any such
purpose, and not prepay, purchase or redeem, and not permit any of its
Subsidiaries to purchase, any subordinated Indebtedness of the Borrower (any
such foregoing redemption, purchase, acquisition, declaration, payment,
distribution, prepayment or set aside herein called a "DISTRIBUTION" and all of
the foregoing collectively called "DISTRIBUTIONS") except:
(i) the Borrower may make Distributions on any date so long as
such Distributions, do not exceed the positive difference,
if any, between (i) the sum of (A) Incremental Earnings PLUS
(B) Incremental Losses, to the date
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of such Distribution, MINUS (ii) Aggregate Distributions and
Investments to and including the date of such Distribution
(without giving effect to such Distribution on such date);
PROVIDED that no Event of Default or Unmatured Event of
Default has occurred and is continuing or would occur as a
result of any such Distribution;
(ii) [Intentionally Omitted];
(iii) the Borrower may make payments of principal and accrued
interest on the RSNs PROVIDED that (A) such payment is
permitted by and in accordance with the terms of such
Indebtedness and any subordination provisions and agreements
applicable thereto and (B) no Unmatured Event of Default of
the type described in SECTION 12.1.1, 12.1.2, 12.1.4,
12.1.8, 12.1.9, 12.1.16, or Event of Default shall have
occurred and be continuing or would occur as a result of any
such payment;
(iv) any Subsidiary of the Borrower may declare and pay dividends
to its owners ratably, in accordance with their respective
ownership interests;
(v) the Borrower may make payments to the Parent Company or any
Affiliate thereof for all reasonable amounts owing to the
Parent Company or any Affiliate thereof in the ordinary
course of business for the Borrower's direct benefit or the
Borrower's PRO RATA share of such ordinary course items,
including, but not limited to, insurance, taxes, and
professional fees; PROVIDED such ordinary course items are
incurred pursuant to an arrangement or contract that
complies with SECTION 9.3.15 and upon the reasonable request
of any Lender or any Agent, the Borrower shall provide
calculations in reasonable detail setting forth such
ordinary course items; and
(vi) the Borrower may make payments to Material Subsidiaries in
respect of Indebtedness described in SECTION 9.3.3(XVI) to
the extent permitted by the subordination provisions in such
promissory notes as described in SECTION 9.3.3(XVI).
The Borrower will not permit any Guarantor to issue any shares of capital stock
having any voting rights including, without limitation, in connection with a
stock dividend, UNLESS such shares are promptly pledged to, and a first and
prior lien or security interest therein is promptly granted to, the Collateral
Agent, for the benefit of the Lenders, pursuant to a duly authorized, executed
and delivered Pledge Agreement, from each holder of such shares, as additional
security for the Loans and all other Obligations hereunder, all Obligations to
any Lender pursuant to Hedging Obligations or all Obligations pursuant to such
holder's Guaranty. The holder of such shares shall further deliver to the
Collateral Agent stock certificates and undated stock powers executed in blank
and any and all instruments, documents, approvals, consents or
65
opinions of counsel reasonably requested by the Collateral Agent or any other
Agent in connection with any such Pledge Agreements required to be executed
pursuant to the foregoing.
SECTION 9.3.2 STOCK PURCHASES. Not, and not permit any of its Subsidiaries
to, make a Borrowing hereunder or use any Letter of Credit or the proceeds of a
Loan to consummate a tender offer, merger, stock purchase transaction, or
investment in the securities of any other Person unless the board of directors,
partners, members, or other governing body of such Person and any shareholder,
partner or member vote required by law or corporate charter shall have approved
such tender offer, merger, stock purchase transaction or investment.
SECTION 9.3.3 PERMITTED INDEBTEDNESS. Not, and not permit any of its
Subsidiaries to, create, incur, assume or permit to exist or otherwise become or
be liable in respect of any Indebtedness unless approved in writing by the
Required Lenders, except:
(i) Indebtedness under this Agreement and the other Loan
Documents;
(ii) Indebtedness in respect of the Medium Term Notes and any
Indebtedness refinancing such Medium Term Notes or in
extension or renewal thereof;
(iii) current accounts payable and accrued liabilities arising
in the ordinary course of business;
(iv) Indebtedness incurred in connection with the Liens
permitted by SECTION 9.3.4;
(v) Indebtedness of any Material Subsidiary of the Borrower
payable to the Borrower PROVIDED that such Indebtedness
shall be evidenced by the Intercompany Subordinated Demand
Note of such Material Subsidiary payable to the order of
the Borrower, and endorsed over to the Collateral Agent
pursuant to the terms of, and subject to the Liens created
under, the Notes Security Agreement, and PROVIDED FURTHER,
that such Indebtedness shall be subordinated pursuant to
the terms of a subordination agreement in substantially the
form of the Subordination Agreement referred to in
SECTION 11.1.10;
(vi) (a) Capitalized Lease Obligations; provided the amount of
Capitalized Lease Obligations payable by the Borrower and
its Subsidiaries during any calendar year does not exceed
$20,000,000 in the aggregate and (b) Indebtedness of the
Borrower and its Subsidiaries of the type described in
CLAUSE (D) of the definition of "INDEBTEDNESS"; PROVIDED the
amount of rentals payable by the Borrower and its
Subsidiaries under all arrangements (other than the
66
Lease) for such Indebtedness described in such CLAUSE (D)
during any calendar year does not exceed $7,500,000 in the
aggregate;
(vii) Indebtedness of the Borrower or any of its Subsidiaries in
respect of Hedging Obligations from time to time entered
into in accordance with customary industry practice;
(viii) [Intentionally omitted];
(ix) Indebtedness of the Borrower and the Lessee under the
Operative Documents, all as in effect on the date hereof;
(x) Indebtedness of the Borrower to the Holding Company or the
Parent Company evidenced by the RSNs in an aggregate
original principal amount not to exceed $100,000,000;
(xi) Indebtedness permitted under SECTION 9.3.5;
(xii) Indebtedness for current taxes and deferred taxes not
delinquent or being contested in good faith and by
appropriate proceedings;
(xiii) Indebtedness of the Borrower to the Parent Company or its
Affiliates permitted under SECTION 9.3.1(V);
(xiv) Indebtedness in respect of one or more letters of credit
(other than Letters of Credit) in an aggregate undrawn
face amount not to exceed $4,000,000 for all such letters
of credit;
(xv) Indebtedness of any Material Subsidiary of the Borrower
(the "PAYOR") to any other Subsidiary of the Borrower (the
"PAYEE") PROVIDED that (a) such Indebtedness shall be
evidenced by a promissory note of the Payor payable to the
order of the Payee, (b) such promissory note is subordinated
to the Guaranty of the Payor and the other obligations of
the Payor to the Lenders and the Agents pursuant to
subordination provisions in such promissory note no less
favorable to the Lenders than those provisions set forth in
EXHIBIT 9.3.3(XV) hereto;
(xvi) Indebtedness of the Borrower to any Subsidiary of the
Borrower PROVIDED that (a) such Indebtedness shall be
evidenced by a promissory note of the Borrower payable to
the order of such Subsidiary, (b) such promissory note is
subordinated to the Obligations of the Borrower pursuant to
subordination provisions in
67
such promissory note no less favorable to the Lenders than
those provisions set forth in EXHIBIT 9.3.3(XV) hereto;
(xvii) [Intentionally omitted];
(xviii) [Intentionally omitted];
(xix) Indebtedness of any Subsidiary of the Borrower that is not
a Material Subsidiary, payable to the Borrower or any
Material Subsidiary, PROVIDED the aggregate outstanding
principal amount of all such Indebtedness does not at any
time exceed the positive difference, if any, of (x)
$35,000,000 PLUS Incremental Earnings PLUS Incremental
Losses to such time, MINUS (y) Aggregate Distributions and
Investments to and including such time;
(xx) [Intentionally omitted];
(xxi) Indebtedness of the Borrower not to exceed in the
aggregate the greater of (a) $50,000,000 and (b) the
aggregate unused portion of the Commitment Amount (it
being understood that the principal amount of all Loans
and the outstanding principal amount of all Letters of
Credit Liabilities shall be considered utilizations of the
Commitment Amount), pursuant to one or more unsecured
lines of credit; and
(xxii) [Intentionally omitted];
(xxiii) Indebtedness of any Subsidiary of the Borrower that is not
a Material Subsidiary, payable to any other Subsidiary of
the Borrower that is not a Material Subsidiary.
SECTION 9.3.4 LIENS. Not, and not permit any of its Subsidiaries to,
create or permit to exist any Lien with respect to any Assets (it being
understood that any Asset sold, transferred, conveyed, assigned or otherwise
disposed of to any Person (other than to the Borrower or any of its
Subsidiaries) as permitted by SECTION 9.3.8 (other than SECTIONS 9.3.8(IV) and
9.3.8(XIV)) shall not be subject to the provisions of this SECTION 9.3.4 upon
the consummation of such sale, transfer, conveyance, assignment or disposition)
now owned or hereafter acquired, except
(i) those in favor of the Collateral Agent pursuant to the
Security Documents;
(ii) the Liens referred to in CLAUSES (VII) and (VIII) of
SECTION 8.6, and the types of Liens referred to in the
other clauses of SECTION 8.6 and the Liens listed on
Exhibit 8.6;
68
(iii) [Intentionally omitted];
(iv) Liens on (A) cash collateral, (B) letters of credit or (C)
Permitted Investments pledged as collateral in favor of
counterparties to Hedging Obligations of the type
described in CLAUSE (B) of the definition of "HEDGING
OBLIGATIONS" and permitted by SECTION 9.3.3(VII);
(v) Liens or encumbrances on Receivables created in
connection with a Receivables Financing permitted
pursuant to SECTION 9.3.19 and Liens or encumbrances on
the rights of the Borrower or any of its Subsidiaries
related to such Receivables which are transferred to the
purchaser of such Receivables in connection with any
such permitted Receivables Financing; PROVIDED that such
Liens secure only, or such encumbrances relate solely
to, the obligations of the Borrower or any of its
Subsidiaries in connection with such Receivables
Financing; and
(vi) Liens on Assets securing Indebtedness of Capitalized Lease
Obligations provided such Liens attach solely to the
assets subject of the capitalized lease.
SECTION 9.3.5 GUARANTIES, LOANS, ADVANCES OR INVESTMENTS. Not, and not
permit any of its Subsidiaries to, become or be a guarantor or surety of,
endorse or otherwise become or be contingently liable upon (by direct or
indirect agreement, contingent or otherwise, or by operation of law, to provide
funds for payment, to supply funds to, or otherwise invest in, a debtor, or
otherwise assure a creditor against loss) the debt, obligation, undertaking or
other liability of any other Person, or otherwise become or be responsible in
any manner (whether by agreement to purchase any obligations, stock, assets,
goods or services, or to supply or advance any funds, assets, goods or services,
or otherwise) with respect to, any undertaking of any other Person, or make or
permit to exist any loans or advances to or investments in any other Person,
except for
(i) (a) the endorsement, in the ordinary course of collection,
of instruments payable to the Borrower or any of its
Subsidiaries or to the order of the Borrower or any of its
Subsidiaries and (b) advances and prepayments to trade
creditors and employees incurred in the ordinary course of
business;
(ii) the Guaranties;
(iii) guaranties or similar assurances incurred by the Borrower
or its Subsidiaries in respect of obligations of the
Borrower or its Subsidiaries permitted hereunder and
incurred in the ordinary course of a Permitted Business
provided that such obligations so guarantied
69
are not Funded Debt or lease obligations other than Funded
Debt or lease obligations permitted hereunder;
(iv) the guaranty by the Borrower or its Subsidiaries of
Hedging Obligations of the Borrower or Subsidiaries of the
Borrower permitted under SECTION 9.3.3(VII);
(v) [Intentionally omitted];
(vi) the Transok Guaranty (as defined in the Participation
Agreement);
(vii) [Intentionally omitted];
(viii) [Intentionally omitted];
(ix) [Intentionally omitted];
(x) [Intentionally omitted];
(xi) [Intentionally omitted];
(xii) [Intentionally omitted];
(xiii) [Intentionally omitted];
(xiv) guaranties and indemnities by the Borrower or any of its
Subsidiaries pursuant to a Receivables Financing of the
Borrower or any Subsidiary of the Borrower permitted
hereunder;
(xv) [Intentionally omitted];
(xvi) [Intentionally omitted];
(xvii) (a) loans from the Borrower to its Material Subsidiaries
pursuant to Indebtedness permitted under SECTION 9.3.3(V);
(b) loans from any Subsidiary of the Borrower to any
Material Subsidiary of the Borrower pursuant to
Indebtedness permitted under SECTION 9.3.3(XV); loans from
any Subsidiary of the Borrower to the Borrower pursuant to
Indebtedness permitted under SECTION 9.3.3(XVI); (c) loans
from any Subsidiary of the Borrower that is not a Material
Subsidiary to any Subsidiary of the Borrower that is not a
Material Subsidiary pursuant to Indebtedness permitted
under SECTION 9.3.3(XXIII); and (d) loans from the
Borrower or from a Material Subsidiary of the Borrower to
any Subsidiary of the Borrower that is not a Material
70
Subsidiary not to exceed an aggregate principal amount
equal to the positive difference, if any, of (x)
$35,000,000 PLUS Incremental Earnings PLUS Incremental
Losses to the date of such loan MINUS (y) Aggregate
Distributions and Investments to and including the date of
such loan (without giving effect to such loan on such
date) for all such loans;
(xviii) loans from the Borrower to the Holding Company and/or the
Parent Company not to exceed an aggregate principal
amount equal to the sum of (a) $100,000,000 (excluding
accrued and unpaid interest), PLUS (b) so long as no
Event of Default or Unmatured Event of Default has
occurred and is continuing or would occur as a result of
any such loan, an amount equal to the positive
difference, if any, of (x) the sum of Incremental
Earnings PLUS Incremental Losses to the date of such
loan MINUS (y) Aggregate Distributions and Investments
to and including the date of such loan (without giving
effect to such loan on such date); PROVIDED that (a) the
Borrower may not make any loan to the Parent Company if
an Unmatured Event of Default of the type described in
SECTION 12.1.1, 12.1.2, 12.1.4, 12.1.8, 12.1.9 or
12.1.16, or Event of Default has occurred and is
continuing or would occur as a result of any such loan,
(b) the obligations of the Holding Company or the Parent
Company, as the case may be, with respect to any such
loans are evidenced by promissory notes of the Holding
Company or the Parent Company, as the case may be,
payable to the order of the Borrower (as from time to
time amended, modified or supplemented, each "PARENT
COMPANY NOTE"), (c) such Parent Company Notes are
endorsed and delivered by the Borrower to the Collateral
Agent pursuant to the terms of, and subject to the Liens
created under, the Notes Security Agreement and (d) the
Indebtedness evidenced by such Parent Company Notes
ranks PARI PASSU with all senior unsecured debt of the
Holding Company or the Parent Company, as the case may
be;
(xix) Equity Investments by the Borrower or any of its
Subsidiaries in any one or more Persons that is not the
Borrower or a Material Subsidiary of the Borrower in an
aggregate amount not to exceed at the time of such Equity
Investment the sum of (a) $35,000,000 PLUS (b) the
positive difference, if any, between (1) Incremental
Earnings to such date, if any, and zero if no Incremental
Earnings to such date and (2) all Aggregate Distributions
and Investments to and including such date (without giving
effect to Equity Investments on such date); PROVIDED that
any Equity Investment pursuant to this CLAUSE (XIX) will
only be made in cash;
71
(xx) Equity Investments in Material Subsidiaries;
(xxi) [Intentionally omitted];
(xxii) [Intentionally omitted];
(xxiii) Permitted Investments; and
(xxiv) Equity Investments outstanding as of the Effective Date
and set forth in EXHIBIT 9.3.5 (XXIV).
SECTION 9.3.6 RESTRICTIONS ON FUNDAMENTAL CHANGES. Without the prior
written consent of the Required Lenders, not, and not permit any of its
Subsidiaries to, be a party to any merger into or consolidation with, or
purchase or otherwise acquire all or substantially all of the assets of, any
other Person, except that (1) the Borrower or any of its Subsidiaries may merge
into or consolidate with any other Person and the Borrower or any of its
Subsidiaries may purchase or otherwise acquire the assets of any other Person,
IF upon the consummation of any such merger, consolidation, purchase or
acquisition, (A) the Borrower or, if the Borrower is not a party to such merger,
such Subsidiary is the surviving entity and the nature of its business is not
materially changed from its core Hydrocarbons, transportation, construction,
procurement, sales, leasing, storage, transmission, gathering, marketing,
processing and other related activities, (B) the Borrower or such Subsidiary has
the power and authority under the pertinent agreement, as applicable, and under
applicable law, to subject the assets of such acquired Person or the assets so
acquired to the provisions of this Agreement, including, without limitation,
SECTION 9.3.4, (C) the Borrower or such Subsidiary does so subject such assets
to the provisions of this Agreement, including without limitation, SECTION
9.3.4, and (D) no Event of Default or Unmatured Event of Default shall have
occurred, exist or be continuing or shall result after giving effect to such
merger, consolidation, purchase or acquisition and (2) the Borrower or any
Subsidiary of the Borrower may merge into, or consolidate with, or purchase or
otherwise acquire the assets of, any other Subsidiary of the Borrower, if (A)
the surviving entity (if either such Subsidiary is a Guarantor) shall be the
Borrower, a Subsidiary that is liable with all other Guarantors pursuant to a
Guaranty for all obligations of the Borrower under this Agreement and the Notes
or a Subsidiary that is liable for all obligations of the Borrower under this
Agreement and each other Loan Document to which the Borrower is a party, (B) the
Collateral Agent shall have received documentation duly executed by the
surviving entity in form and substance satisfactory to the Required Lenders and
the Agents, which documentation shall at a minimum consist of (x) the execution
and delivery of a Guaranty or restated Guaranty (if the surviving Subsidiary is
not a Guarantor prior to the consummation of such merger or consolidation but is
a Material Subsidiary or a Subsidiary which directly owns an interest in a
Guarantor) and supporting documentation substantially similar to the
documentation described in SECTION 11.1, as applicable or (y) the execution and
delivery of an assumption agreement of the obligations of the Borrower under or
in connection with, among others, this Agreement, the Notes and the Security
Documents (if the Borrower merges or consolidates with a Subsidiary and such
Subsidiary is the surviving entity) and supporting documentation substantially
similar to the
72
documentation described in SECTION 11.1, as applicable, and (C) no Event of
Default or Unmatured Event of Default shall have occurred and be continuing or
would otherwise be existing after or result from such merger or consolidation.
The Borrower shall not, and shall not permit any of its Subsidiaries to, sell
or dispose of any capital stock of any Subsidiary of the Borrower except for
Transfer of minority interests in any Subsidiary of the Borrower pursuant to
SECTION 9.3.8(IX).
SECTION 9.3.7 FISCAL YEAR. Not, and not permit any of its Subsidiaries to,
change its fiscal year as in effect on the date hereof without the consent of
the Required Lenders, which consent shall not be unreasonably withheld.
SECTION 9.3.8 TRANSFER OF ASSETS. Not, and not permit any of its
Subsidiaries to, Transfer any Asset (including, without limitation, any sale or
assignment with or without recourse of any Receivable and any Transfer pursuant
to an Option to Purchase) whether or not such Asset constitutes all or a
substantial part of its Assets, except:
(i) retirement of assets in the ordinary course of business;
(ii) the Transfer of any Asset or Assets; PROVIDED that (x)
the Commitment Amount is reduced as a result thereof in
accordance with SECTION 5.5, (y) promptly, and in any
event within five (5) Business Days after the receipt by
the Borrower or such Subsidiary of the Net Proceeds of
such Transfer, the Borrower shall provide the
Administrative Agent with written notice of such
Transfer, of the amount of the Fair Market Value and the
Net Proceeds thereof, and of the Borrower's election to
make such Transfer pursuant to this CLAUSE (II), and (z)
in the event of any Transfer of any Asset or related
Assets with a Fair Market Value estimated by the
Borrower in good faith to be in excess of $25,000,000 to
the Parent Company or any Affiliate of the Parent
Company (other than to the Borrower or a Subsidiary of
the Borrower), the Lenders shall have received a written
appraisal (dated a date, and using a method of appraisal
and assumptions, reasonably acceptable to the Required
Lenders), from an independent appraiser reasonably
acceptable to the Required Lenders, of the Fair Market
Value of such Asset;
(iii) at any time after the Effective Date, (a) the Transfer of
any Asset or Assets having a Fair Market Value at the time
of Transfer of $40,000,000 or less in the aggregate for
all such Transfers in any fiscal year, and (b) the
Transfer of any Asset or Assets having a Fair Market Value
at the time of such Transfer equal to or less than the
lesser of (x) $80,000,000 and (y) the then Unused Asset
Transfer Allowance; PROVIDED that (x) promptly, and in any
event within fifteen (15) days after the receipt by the
Borrower or such Subsidiary
73
of the Net Proceeds of such Transfer, the Borrower shall
provide the Administrative Agent with written notice of
such Transfer, of the amount of the Fair Market Value
and the Net Proceeds thereof, and of the Borrower's
election to make such Transfer pursuant to this CLAUSE
(III), and (y) in the event of any Transfer of any Asset
(or related Assets) with a Fair Market Value estimated
by the Borrower in good faith to be in excess of
$25,000,000 to the Parent Company or any Affiliate of
the Parent Company (other than to the Borrower or a
Subsidiary of the Borrower), the Lenders shall have
received a written appraisal (dated a date, and using a
method of appraisal and assumptions, reasonably
acceptable to the Required Lenders), from an independent
appraiser reasonably acceptable to the Required Lenders,
of the Fair Market Value of such Asset; PROVIDED
FURTHER, that Transfers to Coral Energy Resources, L.P.,
a Delaware partnership ("CORAL") or any Affiliate
thereof, of a portion of the Borrower's and its
Subsidiaries' respective economic interests in certain
contracts having an aggregate Fair Market Value not to
exceed $25,000,000 shall not be considered a Transfer
(any portion transferred in excess thereof to be
considered a Transfer) for purposes of the $40,000,000
and $80,000,000 limits set forth above and for purposes
of CLAUSE (B) of the definition of "Unused Asset
Transfer Allowance," if at the time of such Transfer
Coral or such Affiliate thereof is an Affiliate of the
Borrower;
(iv) the Transfer of any Asset to the Borrower or any
Guarantor;
(v) Transfers in connection with the settlement of Hedging
Obligations permitted under SECTION 9.3.3(VII);
(vi) the sale of inventory in the ordinary course of business;
(vii) the Transfer of the interest in the Palo Duro Pipeline
leased by the Borrower or one or more of its Subsidiaries
to Central and South West Corporation or an Affiliate
pursuant to the Merger Agreement;
(viii) the Transfer of Receivables in accordance with SECTION
9.3.19;
(ix) the Transfer of minority interests in any Subsidiary of
the Borrower provided that after giving effect to such
Transfer, such Subsidiary remains a Subsidiary of the
Borrower;
(x) [Intentionally omitted];
(xi) the assignment or termination of any Hedging Obligation;
74
(xii) [Intentionally omitted];
(xiii) [Intentionally omitted]; and
(xiv) the Transfer by a Subsidiary of the Borrower (other than a
Material Subsidiary of the Borrower or a Guarantor) to a
Subsidiary of the Borrower or to the Borrower.
The foregoing notwithstanding, the Borrower shall not, nor shall the Borrower
permit any of its Subsidiaries to, Transfer any Assets, other than the sale of
inventory and payment of trade payables in the ordinary course of business, to
any Person pursuant to this SECTION 9.3.8 if an Event of Default or Unmatured
Event of Default shall have occurred and be continuing or would otherwise be
existing after or result from any such Transfer.
SECTION 9.3.9 UNCONDITIONAL PURCHASE OBLIGATIONS. Not, and not permit any
of its Subsidiaries to, enter into or be a party to any material contract for
the purchase of materials, supplies or other property or services, if such
contract requires that payment be made by it regardless of whether or not
delivery is ever made of such materials, supplies or other property or services
except for (i) take-or-pay arrangements and Hedging Obligations permitted under
SECTION 9.3.3(VII) entered into in the ordinary course of business in accordance
with industry standards by the Borrower and its Subsidiaries relating to the
purchase and sale of energy-related commodities, including Hydrocarbons, (ii)
those set forth on EXHIBIT 9.3.9 and (iii) arrangements entered into by the
Borrower and its Subsidiaries relating to the purchase of assets or stock of
another Person.
SECTION 9.3.10 OTHER AGREEMENTS. Not, and not permit any of its
Subsidiaries to, enter into any agreement containing any provision which would
be violated or breached by the performance of their Obligations hereunder or
under any instrument or document delivered or to be delivered by them hereunder
or in connection herewith in each case if such violation would singly or in the
aggregate have or may reasonably be expected to have a material adverse effect
on the consolidated business condition (financial or otherwise), operations,
performance or properties of the Borrower and its Subsidiaries (taken as a
whole) or on the ability of the Borrower and its Subsidiaries to perform their
respective obligations under each of the Loan Documents or which could result in
any liability to any Agent or any Lender.
SECTION 9.3.11 BUSINESS ACTIVITIES. Not, and not permit any of its
Subsidiaries to, engage in any business activities other than Hydrocarbon
transportation, construction, procurement, sales, leasing, storage,
transmission, gathering, marketing, processing and other related business
activities ("Permitted Business").
SECTION 9.3.12 CAPITAL EXPENDITURES, ETC. Not, and not permit any of its
Subsidiaries to, make or commit to make any Capital Expenditures the effect of
which would materially change the nature of its business away from its core
Permitted Businesses.
75
SECTION 9.3.13 NEGATIVE PLEDGES, RESTRICTIVE AGREEMENTS, ETC. Not, and not
permit any of its Subsidiaries to, enter into any agreement (other than this
Agreement, any other Loan Document, any of the Operative Documents, or the
Medium Term Notes or organizational documents for Subsidiaries which documents
are in existence prior to June 6, 1996) prohibiting (a) the creation or
assumption of any Lien upon its properties, revenues or assets, whether now
owned or hereafter acquired; (b) the ability of the Borrower or any Guarantor or
the Parent Company to amend or otherwise modify this Agreement or any other Loan
Document; or (c) the ability of any Subsidiary of the Borrower to make any
payments, directly or indirectly, to the Borrower by way of dividends, advances,
repayments of loans or advances, reimbursements of management and other
intercompany charges, expenses and accruals or other returns on investments, or
any other agreement or arrangement which restricts the ability of any such
Subsidiary to make any payment, directly or indirectly, to the Borrower.
SECTION 9.3.14 [INTENTIONALLY OMITTED].
SECTION 9.3.15 TRANSACTIONS WITH AFFILIATES. Not, and not permit any of
its Subsidiaries to, enter into any transaction (including, without limitation,
the purchase or sale of any property or service) with, or make any payment or
transfer to, any Affiliate (other than the Borrower or a Guarantor) except in
the ordinary course of business and pursuant to the reasonable requirements of
the Borrower's or such Subsidiary's business and upon fair and reasonable terms
no less favorable to the Borrower or such Subsidiary than the Borrower or such
Subsidiary would obtain in a comparable arms-length transaction.
SECTION 9.3.16 RESTRICTIONS ON DECREASE IN CAPITAL STOCK. Not take any
action, or permit any of its Subsidiaries to take any action, which will result
in a decrease in the percentage of the outstanding shares of capital stock of,
or in the percentage of the partnership interests in, any of the Material
Subsidiaries of the Borrower or any Guarantor by the Borrower and any Subsidiary
of the Borrower other than as permitted by SECTION 9.3.6 or SECTION 9.3.8(IX)
herein.
SECTION 9.3.17 [INTENTIONALLY OMITTED].
SECTION 9.3.18 MODIFICATIONS OF CERTAIN AGREEMENTS. Not, and not permit
any of its Subsidiaries to, consent to any amendment, supplement or other
modification of any of the subordination terms or subordination provisions
contained in or applicable to any document or instrument evidencing or
applicable to any Subordinated Debt.
SECTION 9.3.19 RECEIVABLES FINANCING. Not, and not permit any of its
Subsidiaries to, sell, transfer, convey, assign or otherwise dispose of, with or
without recourse, any Receivables of any kind; PROVIDED, HOWEVER, the foregoing
restriction will not prohibit the sale of Receivables of the Borrower and its
Subsidiaries so long as (a) such Receivables are sold pursuant to a Receivables
Financing for no less than 80% of face value and (b) the aggregate outstanding
amount of Receivables so sold at no time exceeds $75,000,000.
76
SECTION 9.4 FINANCIAL COVENANTS. The Borrower will and will cause each of
its Subsidiaries to:
SECTION 9.4.1MINIMUM STOCKHOLDERS' EQUITY. Not permit the Stockholders'
Equity of the Borrower at any time to be less than $210,000,000 as adjusted at
the end of each calendar quarter, commencing with the calendar quarter ending
December 31, 1996, by adding 50% of the Consolidated Net Income, if positive, of
the Borrower and its Subsidiaries on a consolidated basis for such quarter.
SECTION 9.4.2EBITDA TO TOTAL INTEREST EXPENSE. Not permit the ratio of
EBITDA to Total Interest Expense for any consecutive period of four fiscal
quarters ending on the last day of each fiscal quarter during any of the
following periods to be less than the ratio set forth opposite such period
below:
PERIOD RATIO
------ -----
September 30, 1996 to September 30, 1998 1.85 : 1.00
October 1, 1998 to September 30, 1999 2.25 : 1.00
October 1, 1999 and thereafter 2.75 : 1.00;
provided, that for purposes of determining compliance with this SECTION 9.4.2
for the periods ending on each of September 30, 1996, December 31, 1996 and
March 31, 1997, the actual quarterly EBITDA and Total Interest Expense from the
Closing Date to each such respective date shall be annualized, and thereafter,
all calculations will be based upon the four fiscal quarters ending on the last
day of each fiscal quarter.
SECTION 9.4.3FUNDED DEBT TO CAPITALIZATION. Not permit the ratio of (a)
the sum of Funded Debt PLUS Operating Lessor's Debt to (b) Capitalization
expressed as a percentage to exceed 68% at any time.
77
ARTICLE X
COLLATERAL SECURITY
As collateral security for its Obligations hereunder and under the Notes
and the other Loan Documents, the Borrower and its Subsidiaries shall, as
applicable, either (i) acknowledge and reaffirm the Security Documents executed
and delivered pursuant to the Original Credit Agreement or (ii) execute and
deliver or cause to be executed and delivered to the Collateral Agent the
following:
SECTION 10.1 PLEDGE AGREEMENT. A pledge agreement (herein, together with
each Pledge Agreement as defined in and executed and delivered pursuant to the
Original Credit Agreement, as from time to time amended, modified or
supplemented, individually called a "PLEDGE AGREEMENT" and collectively called
the "PLEDGE AGREEMENTS") in substantially the form of EXHIBIT 10.1A or 10.1B, as
appropriate, from the Borrower and any Subsidiary of the Borrower (including all
entities which shall become Subsidiaries of the Borrower after the Closing Date)
owning stock of any Material Subsidiary including those set forth in EXHIBIT 8.7
(and including all entities which shall become Material Subsidiaries after the
Closing Date), together with all the issued and outstanding capital stock of all
such Material Subsidiaries of the Borrower owned by the Borrower and its
Subsidiaries.
SECTION 10.2 PARTNERSHIP/LIMITED LIABILITY COMPANY SECURITY AGREEMENT. A
Security Agreement, Undertaking and Financing Statement (herein, together with
each Partnership/Limited Liability Company Security Agreement as defined in and
executed and delivered pursuant to the Original Credit Agreement, as from time
to time amended, modified or supplemented, individually called a
"PARTNERSHIP/LIMITED LIABILITY COMPANY SECURITY AGREEMENT" and collectively
called the PARTNERSHIP/LIMITED LIABILITY COMPANY SECURITY AGREEMENTS") in
substantially the form of EXHIBIT 10.2 from the Borrower and each Subsidiary of
the Borrower (including all entities which shall become Subsidiaries after the
Closing Date) owning a partnership interest or membership interest in any
Material Subsidiary (including all entities which shall become Material
Subsidiaries after the Closing Date).
SECTION 10.3 GUARANTIES. A Guaranty (herein, together with each Guaranty
as defined in and executed and delivered pursuant to the Original Credit
Agreement, as from time to time amended, modified or supplemented, individually
called a "GUARANTY" and collectively called the "GUARANTIES") from each
Guarantor in substantially the form of EXHIBIT 10.3.
SECTION 10.4 NOTES SECURITY AGREEMENT. A Security Agreement, Assignment,
Undertaking and Financing Statement (herein, together with the Notes Security
Agreement (as defined in and executed and delivered pursuant to the Original
Credit Agreement) as amended by the First Amendment to Security Agreement,
Assignment, Undertaking and Financing Statement in substantially the form of
EXHIBIT 11.1.11 hereto, as from time to time amended, modified or supplemented,
called the "NOTES SECURITY AGREEMENT") from the Borrower in substantially the
form of EXHIBIT 10.4A, pledging (i) a subordinated demand promissory note from
each Material Subsidiary of the Borrower in favor of the Borrower in
substantially the form of EXHIBIT 10.4B (herein, together with the Intercompany
Subordinated Demand Notes as defined in and executed and delivered pursuant to
the Original Credit Agreement, as from time to time amended, modified or
supplemented, collectively called the "INTERCOMPANY SUBORDINATED DEMAND NOTES"),
(ii) [intentionally omitted], and (iii) all Parent Company Notes.
SECTION 10.5 GUARANTY OF THE HOLDING COMPANY. The Guaranty dated as of
June 6, 1996 from the Holding Company (herein, as the same may amended,
modified, supplemented, extended or renewed, called the "HOLDING COMPANY
GUARANTY") and the Security Agreement, Undertaking and Financing Statement dated
as of June 6, 1996 from the Holding Company (herein, as the same may amended,
modified, supplemented, extended or renewed, called the "HOLDING COMPANY
SECURITY AGREEMENT").
78
ARTICLE XI
CONDITIONS TO BORROWING
The obligation of each Lender to fund or make any Borrowing is subject to
the following conditions precedent:
SECTION 11.1 CONDITIONS PRECEDENT TO INITIAL BORROWING. The obligation of
each Lender to fund or make its Borrowing on the Initial Borrowing Date is, in
addition to the conditions precedent specified in SECTIONS 11.2 and 11.3,
subject to the conditions precedent that the Administrative Agent shall have
received all of the following, each duly executed and dated the date of the
Initial Borrowing Date (or such other date prior thereto as shall be
satisfactory to the Agents), in form and substance satisfactory to the Agents,
and each (except for the Notes, of which only one original shall be signed for
each Lender) in sufficient number of signed counterparts to provide one for
each Agent and each Lender:
SECTION 11.1.1 EXECUTED ORIGINAL NOTES. The Notes of the Borrower payable
to the order of each of the Lenders, which shall be exchanged for the Notes
issued pursuant to the Original Credit Agreement marked "amended, renewed and
extended", and delivered to the Borrower.
SECTION 11.1.2 CERTIFICATE OF OFFICERS OF THE BORROWER AND CERTAIN
SUBSIDIARIES. Certificates, in form and substance satisfactory to the Agents, of
a Secretary or an Assistant Secretary and the President or a Vice President of
the Holding Company, the Borrower and each Subsidiary of the Borrower which is a
party to a Loan Document, together with certified copies of the articles of
incorporation and bylaws, certificate of formation and limited liability company
agreement, or the partnership agreement, as the case may be, and signatures and
incumbency of officers of the Holding Company, the Borrower and each such
Subsidiary of the Borrower and resolutions with respect to the transactions
contemplated herein; provided that in lieu of delivering articles of
incorporation, bylaws, certificates of formation, limited liability company
agreements or partnership agreements for the Holding Company and for
Subsidiaries of the Borrower for which such documents were provided to the
Administrative Agent pursuant to the Original Credit Agreement and which
documents so provided have not changed, such certificate may state that such
documents were so delivered and have not changed.
SECTION 11.1.3 CONSENTS, ETC. Certified copies of all documents evidencing
any necessary corporate action, consents and governmental approvals (if any)
with respect to this Agreement, the Notes, any Security Document or any other
documents provided for herein or therein and certified copies of all notices or
requests for consents required to be obtained in order to enable the Holding
Company, the Borrower and each Subsidiary of the Borrower, as applicable, to
acknowledge and reaffirm the liens pursuant to the Security Documents and
execute the pertinent collateral documents described in ARTICLE X.
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SECTION 11.1.4 OPINION OF COUNSEL FOR THE BORROWER. The opinions of
Xxxxxxxxx & Xxxxxx, L.L.P., counsel for the Holding Company, the Borrower and
certain Subsidiaries of the Borrower, addressed to the Lenders in substantially
the form of EXHIBIT 11.1.4.
SECTION 11.1.5 [INTENTIONALLY OMITTED].
SECTION 11.1.6 THE PLEDGE AGREEMENT. An acknowledgment and reaffirmation,
and any necessary financing statements relating thereto, as to each of the
Pledge Agreements duly executed by each of the Persons that executed and
delivered a Pledge Agreement pursuant to the Original Credit Agreement, in
substantially the form of EXHIBIT 11.1.6.
SECTION 11.1.7 [INTENTIONALLY OMITTED].
SECTION 11.1.8 GUARANTIES. A consent, acknowledgment, and agreement as to
each of the Guaranties duly executed by each Guarantor described in EXHIBIT
11.1.8 in substantially the form of EXHIBIT 11.1.8A and as to the Holding
Company Guaranty duly executed by the Holding Company in substantially the form
of EXHIBIT 11.1.8B.
SECTION 11.1.9 CERTIFICATE OF FINANCIAL CONDITION. Certificate of
Financial Condition from the chief financial officer of the Borrower, in
substantially the form of EXHIBIT 11.1.9, together with all related financial
statements, opinions and other material documents containing information on
which such certificate is based.
SECTION 11.1.10 SUBORDINATION AGREEMENT. An acknowledgement and
reaffirmation as to the Subordination Agreement as defined in and executed and
delivered pursuant to the Original Credit Agreement (herein, together with any
subordination agreement substantially in the form of EXHIBIT 11.1.10 that may
hereafter be executed and delivered pursuant to SECTION 9.3.3(V) as from time to
time amended, modified, restated or supplemented, the "SUBORDINATION AGREEMENT")
duly executed by the Borrower in substantially the form of EXHIBIT 11.1.10A.
SECTION 11.1.11 NOTES SECURITY AGREEMENT. An amendment to the Notes
Security Agreement duly executed by the Borrower in substantially the form of
EXHIBIT 11.1.11, and any necessary financing statements relating thereto, and
all the original Parent Company Notes outstanding as of the Initial Borrowing
Date properly endorsed to the Collateral Agent (which such Parent Company Notes
shall be exchanged for the Parent Company Note delivered and endorsed to the
Collateral Agent pursuant to the Original Credit Agreement).
SECTION 11.1.12 PARTNERSHIP/LIMITED LIABILITY COMPANY SECURITY AGREEMENT.
An acknowledgment and reaffirmation, and any necessary financing statements
relating thereto, as to each of the Partnership/Limited Liability Company
Security Agreements duly executed by each of the Persons that executed and
delivered a Partnership/Limited Liability Company Agreement pursuant to the
Original Credit Agreement, in substantially the form set forth in EXHIBIT
11.1.12.
80
SECTION 11.1.13 HOLDING COMPANY. An acknowledgment and reaffirmation, and
any necessary financing statements relating thereto, as to the Holding Company
Security Agreement duly executed by the Holding Company in substantially the
form of EXHIBIT 11.1.13.
SECTION 11.1.14 [INTENTIONALLY OMITTED].
SECTION 11.1.15 [INTENTIONALLY OMITTED].
SECTION 11.1.16 FINANCIAL STATEMENTS. Copies, certified by the Borrower as
true, correct and complete copies, of all the financial statements described in
SECTION 8.4(B).
SECTION 11.1.17 OTHER DOCUMENTS. Such other documents as any Agent or any
Lender may reasonably request.
SECTION 11.2 OTHER CONDITIONS PRECEDENT TO MAKING INITIAL BORROWING. The
obligation of each Lender to fund or make any Borrowing on the Initial Borrowing
Date is, in addition to the conditions precedent specified in SECTIONS 11.1 and
11.3, subject to the conditions precedent that:
SECTION 11.2.1 FEES. The Borrower shall have paid to the Administrative
Agent for the benefit of the Lenders or the Agents, as the case may be, all
remaining fees due and payable to the Agents and the Lenders as described in
SECTION 4.4 herein.
SECTION 11.2.2 PURCHASE OF A-NOTES AND B-NOTES. The amendments to the
Operative Documents, and the purchase of and payment for the A-Notes, the
Lessor's A-Invested Amount, the B-Notes and the Lessor's B-Invested Amount by
the Lenders so as to reallocate the commitments of the Lenders under the
Participation Agreement, shall have been concurrently consummated in accordance
with the first amendment to Participation Agreement.
SECTION 11.2.3 [INTENTIONALLY OMITTED].
SECTION 11.2.4 [INTENTIONALLY OMITTED].
SECTION 11.2.5 [INTENTIONALLY OMITTED].
SECTION 11.3 ALL BORROWINGS. The obligation of each Lender to fund or make
any Borrowing (including the Initial Borrowing) is subject to the following
further conditions precedent that:
SECTION 11.3.1 NO DEFAULT; WARRANTIES TRUE AND CORRECT. (i) No Event of
Default, or Unmatured Event of Default, shall have occurred and be continuing,
or will result from the making of such Borrowing and (ii) the representations
and warranties of the Borrower, the Holding Company and each Subsidiary
contained in ARTICLE VIII, any Guaranty or any Security Document shall be true
and correct as of the date of such requested Borrowing, except
81
to the extent such representations and warranties relate solely to an earlier
date (it being understood that the financial statements referred to in SECTION
8.4 are dated as of December 31, 1995 and September 30, 1996, as the case may
be). Each Borrowing under this Agreement shall be deemed to constitute a
representation and warranty by the Borrower on the date of such Borrowing as to
the matters set forth in this SECTION 11.3.1.
SECTION 11.3.2 MATERIAL ADVERSE CHANGE. There shall have been no material
adverse change in the opinion of the Majority Lenders, (i) since September 30,
1996, in the consolidated business condition (financial or otherwise),
operations, performance or properties of the Borrower and its Subsidiaries
(taken as a whole), (ii) since the Effective Date, affecting the rights and
remedies of the Lenders under the Loan Documents, or (iii) since the Effective
Date, in the ability of the Borrower, the Holding Company or the Guarantors to
perform their respective Obligations under the Loan Documents to which they are
a party.
ARTICLE XII
EVENTS OF DEFAULT AND THEIR EFFECT
SECTION 12.1 EVENTS OF DEFAULT. Each of the following shall constitute an
Event of Default under this Agreement:
SECTION 12.1.1 NON-PAYMENT OF THE LOANS, LETTER OF CREDIT OBLIGATIONS,
FEES OR OTHER AMOUNTS. Default, and continuance thereof for five (5) Domestic
Business Days, in the payment when due (i) of any principal of any Loan or any
Reimbursement Obligation, or (ii) of any interest on any Loan, of any Obligation
in connection with or with respect to any Letter of Credit, of any Fixed Rent or
any Additional Rent under the Lease, of any fees payable by the Borrower
hereunder or in connection herewith, or of any other monetary Obligation.
SECTION 12.1.2 NON-PAYMENT OF OTHER INDEBTEDNESS FOR BORROWED MONEY.
Default in the payment when due (subject to any applicable grace period),
whether by acceleration or otherwise, of any other indebtedness for borrowed
money of, or guaranteed by, the Borrower or any of its Subsidiaries having a
principal amount, individually or in the aggregate, in excess of $10,000,000
(except any such indebtedness for borrowed money of any Subsidiary of the
Borrower to the Borrower or any such indebtedness for borrowed money of the
Borrower under the RSNs) or default in the performance or observance of any
obligation or condition with respect to any such other indebtedness for borrowed
money if the effect of such default in performance or observance is to
accelerate the maturity of any such indebtedness for borrowed money or to permit
the holder or holders thereof, or any trustee or agent for such holders, to
cause such indebtedness for borrowed money to become due and payable prior to
its expressed maturity.
SECTION 12.1.3 LEASE. An Event of Default shall have occurred and be
continuing under any of the Operative Documents; provided that from and after
any waiver of such Event
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of Default under any of such Operative Documents, such Event of Default shall no
longer be an Event of Default hereunder.
SECTION 12.1.4 BANKRUPTCY, INSOLVENCY, ETC. The Borrower, any of its
Subsidiaries, the Parent Company, the Holding Company or any Material Tejas
Subsidiary becomes insolvent or generally fails to pay, or admits in writing its
inability to pay, debts as they become due; or the Borrower, any of its
Subsidiaries, the Parent Company, the Holding Company or any Material Tejas
Subsidiary applies for, consents to, or acquiesces in, the appointment of, a
trustee, receiver or other custodian for the Borrower, any of its Subsidiaries,
the Parent Company, the Holding Company or any Material Tejas Subsidiary or any
property of any thereof, or makes a general assignment for the benefit of
creditors; or, in the absence of such application, consent or acquiescence, a
trustee, receiver or other custodian is appointed for the Borrower, any of its
Subsidiaries, the Parent Company, the Holding Company or any Material Tejas
Subsidiary or for a substantial part of the property of any thereof and is not
discharged within sixty (60) days; or any bankruptcy, reorganization, debt
arrangement, or other case or proceeding under any bankruptcy or insolvency law,
or any dissolution or liquidation proceeding (except the voluntary dissolution,
not under any bankruptcy or insolvency law, of a Subsidiary of the Borrower), is
commenced in respect of the Borrower, any of its Subsidiaries, the Parent
Company, the Holding Company or any Material Tejas Subsidiary and if such case
or proceeding is not commenced by the Borrower, any of its Subsidiaries, the
Parent Company, the Holding Company or any Material Tejas Subsidiary, it is
consented to or acquiesced in by the Borrower, any of its Subsidiaries, the
Parent Company, the Holding Company or any Material Tejas Subsidiary or remains
for sixty (60) days undismissed; or the Borrower, any of its Subsidiaries, the
Parent Company, the Holding Company or any Material Tejas Subsidiary takes any
corporate action to authorize, or in furtherance of, any of the foregoing.
SECTION 12.1.5 NON-PERFORMANCE OF CERTAIN COVENANTS AND OBLIGATIONS. The
Borrower shall default in the due performance and observance of any of its
obligations under SECTION 9.1.5(I), 9.3.2 or 9.3.6 (other than SECTION
9.3.6(1)(C)).
SECTION 12.1.6 NON-PERFORMANCE OF OTHER COVENANTS AND OBLIGATIONS. The
Borrower or any Subsidiary of the Borrower shall default in the due performance
and observance of any other provision of this Agreement (and not constituting an
Event of Default under any of the preceding provisions of this SECTION 12.1) or
in any other Loan Document executed by it (and not constituting an Event of
Default under SECTION 12.1.12), and such default shall continue unremedied for a
period of fifteen (15) days after notice thereof to the Borrower from any Agent
or any Agent at the request of any Lender.
SECTION 12.1.7 BREACH OF WARRANTIES AND MISLEADING STATEMENTS. (a) Any
representation or warranty made or deemed made by the Borrower, the Parent
Company, the Holding Company or any Subsidiary of the Borrower herein (other
than in SECTION 8.16) or in any other Loan Document executed by it is breached
or is false or misleading in any material respect on the date made or deemed
made, or (b) any schedule, certificate, financial statement, report, notice, or
other writing now or hereafter furnished by the Borrower, the Parent
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Company, the Holding Company or any Subsidiary of the Borrower to any Agent, the
Issuing Bank or any Lender in connection with the Loan Documents and the
transactions contemplated therein is false or misleading in any material respect
(taken as a whole) on the date as of which the facts therein set forth are
stated or certified, or (c) (i) any representation or warranty made or deemed
made by the Borrower in SECTION 8.16 shall be false or misleading in any
material respect, (ii) the Borrower or any of its Subsidiaries shall obtain
knowledge of any fact or matter which would have made any representation or
warranty made or deemed made in SECTION 8.16(A), (B), (C), (F), (G) or (H) false
or misleading at the time such representation or warranty was made or deemed
made had the Borrower had knowledge of such fact or matter at the time such
representation or warranty was made or deemed made or (iii) any representation
or warranty made or deemed made in SECTION 8.16(D) was false or misleading when
made or deemed made.
SECTION 12.1.8 CHANGE IN OWNERSHIP. Unless the Borrower or the Parent
Company shall have obtained the prior written consent of the Required Lenders,
failure by the Parent Company to own free and clear of all Liens and other
encumbrances (except for agreements prohibiting the creation of any Lien or
security interest on the voting stock of the Borrower and Liens of the type
permitted by SECTIONS 8.6(I), (III) and (XV) of this Agreement), directly or
indirectly through any of its Subsidiaries, 100% of the outstanding voting stock
or membership interests of the Borrower; or failure by the Borrower to own (free
and clear of all Liens and other encumbrances except (i) those in favor of the
Collateral Agent under the Pledge Agreements and the Partnership/Limited
Liability Company Security Agreements and (ii) for agreements prohibiting the
creation of any Lien or security interest on the voting stock, membership
interests or partnership interests, as the case may be, of the Guarantors)
directly or indirectly through any of its Subsidiaries, 100% of the outstanding
voting stock, membership interests or partnership interests, as the case may be,
of the Guarantors (other than failure to own 100% of such outstanding voting
stock, membership interests or partnership interests, as the case may be, as a
result of Transfers of minority interests in Subsidiaries permitted by SECTION
9.3.8(IX) or as a result of any transactions permitted by SECTION 9.3.6).
SECTION 12.1.9 JUDGMENTS. A judgment, decree or order for the payment of
money in an amount of $5,000,000 or more in excess of valid and collectible
insurance in respect thereof the payment of which is not being disputed or
contested by the insurer or insurers shall be rendered against the Borrower or
any of its Subsidiaries (or, in the event the Borrower or such Subsidiary shall
have an indemnity reasonably acceptable to the Required Lenders from a Person
satisfactory to the Required Lenders (which Person acknowledges in writing its
liability for such indemnity) in respect of such judgment, decree or order for
the payment of money, after giving effect to such indemnity, the Borrower's or
such Subsidiary's liability in respect of such judgment, decree or order is in
excess of $5,000,000, as the case may be), and either (a) enforcement
proceedings shall have been commenced by any creditor upon such judgment, decree
or order or (b) such judgment shall become final and non-appealable and shall
have remained outstanding for a period of sixty (60) consecutive days.
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SECTION 12.1.10 EMPLOYEE BENEFIT PLANS. With respect to any Pension Plan,
there shall exist a deficiency of more than $5,000,000 in the aggregate in the
plan assets available to satisfy the benefit liabilities under such plan on
account of which the Borrower or any of its Subsidiaries could incur a liability
in excess of $5,000,000 in the aggregate, and steps are or have been undertaken
to terminate such plan or such plan is terminated or the Borrower or any of its
Subsidiaries withdraws from or institutes steps to withdraw from such plan or
any Reportable Event with respect to such plan shall occur.
SECTION 12.1.11 LIEN OR GUARANTY FAILURE. The failure of any of the
Security Documents to constitute a valid and perfected first and prior lien
upon, and security interest in, any property or properties purported to be
pledged or covered thereby, or, if for any reason whatsoever, any of the
Guaranties or Security Documents becomes unenforceable or the security afforded
thereby becomes unenforceable with respect to any property or properties
purported to be pledged or covered thereby; or the Borrower or any Subsidiary of
the Borrower or the Parent Company shall, directly or indirectly, contest in any
manner the effectiveness, validity, binding nature or enforceability of, or
disclaim their liability under, this Agreement or any other Loan Document to
which it is a party.
SECTION 12.1.12 DEFAULT UNDER ANY SECURITY DOCUMENT. A default shall occur
under the terms of any Security Document or Guaranty and continue for more than
the applicable period of grace, if any, therein set forth.
SECTION 12.1.13 [INTENTIONALLY OMITTED].
SECTION 12.1.14 [INTENTIONALLY OMITTED].
SECTION 12.1.15 [INTENTIONALLY OMITTED].
SECTION 12.1.16 NON-PAYMENT OF OTHER INDEBTEDNESS FOR BORROWED MONEY
BY THE PARENT COMPANY. Default in the payment when due (subject to any
applicable grace period), whether by acceleration or otherwise, of any
indebtedness for borrowed money of, or guaranteed by, the Parent Company and/or
the Holding Company, having a principal amount, individually or in the
aggregate, in excess of $25,000,000; or any indebtedness for borrowed money of
the Parent Company and/or the Holding Company having a principal amount,
individually or in the aggregate, in excess of $25,000,000 shall become due
before its stated maturity by acceleration of the maturity thereof PROVIDED that
default in respect of indebtedness for borrowed money guaranteed by the Parent
Company and/or the Holding Company (other than indebtedness for borrowed money
of the Borrower) shall not be an Event of Default under this SECTION 12.1.16
unless either (i) a request or demand for payment in respect of such guaranty
shall have been made or (ii) enforcement proceedings in respect of such guaranty
shall have been commenced.
SECTION 12.2 EFFECT OF EVENT OF DEFAULT. If any Event of Default described
in SECTION 12.1.4 shall occur with respect to the Borrower, the Commitments of
the Lenders hereunder (if not theretofore terminated) shall immediately
terminate and the outstanding
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principal amount of the Loans and all other Obligations shall automatically be
and become immediately due and payable, all without notice or demand of any
kind; and, in the case of any other Event of Default, the Administrative Agent
may (and, upon written request of the Required Lenders, shall) declare the
Commitments of the Lenders hereunder (if not theretofore terminated) to be
terminated and/or declare all or any portion of the outstanding principal amount
of the Loans and other Obligations to be due and payable, whereupon the
Commitments of the Lenders hereunder (if not theretofore terminated) shall
immediately terminate and/or, as the case may be, the full unpaid amount of such
Loans and other Obligations which shall be so declared due and payable shall be
and become immediately due and payable, all without notice of any kind. The
Administrative Agent shall promptly advise the Borrower and each Lender of any
such declaration, but failure to do so shall not impair the effect of such
declaration. Notwithstanding the foregoing, the effect as an Event of Default of
any event described in SECTION 12.1.1, or SECTION 12.1.4 with respect to the
Borrower, may be waived by the written concurrence of the holders of one hundred
percent (100%) of the aggregate unpaid principal amount of the Borrowings and
the effect as an Event of Default of any other event described in SECTION 12.1
may be waived by the written concurrence of the Required Lenders.
SECTION 12.3 CASH COLLATERALIZATION OF LETTERS OF CREDIT UPON EVENT OF
DEFAULT. Upon the occurrence of an Event of Default, an amount equal to the
amount of the then contingent liability of the Issuing Bank (and the other
Lenders) under each outstanding Letter of Credit shall, at the option of the
Majority Lenders and without demand upon or notice to the Borrower, be deemed
(as between the Borrower, Issuing Bank and the Lenders) to have been paid or
disbursed by the Issuing Bank (and the other Lenders) under such Letter of
Credit (notwithstanding that such amount may not in fact have been so paid or
disbursed), and the Borrower shall be obligated forthwith, upon demand or notice
to the Borrower, to reimburse the Lenders for, by depositing with the Collateral
Agent, which amount may be invested as provided in SECTION 2.4.4, the amount
deemed to have been so paid or disbursed. Any amounts so received by the
Collateral Agent pursuant to the provisions of the preceding sentence shall be
held as collateral security as provided in SECTION 2.4.4 until such time as such
Event of Default is waived or remedied, at which time, if no other Event of
Default shall then exist, any such cash collateral and any interest thereon not
theretofore applied to reduce amounts payable by the Borrower to the Issuing
Bank under such Letter of Credit and not required to remain on deposit as a
result of SECTION 5.7 shall be returned promptly to the Borrower.
ARTICLE XIII
THE ADMINISTRATIVE AGENT, DOCUMENTATION AGENT AND ISSUING BANK
SECTION 13.1AUTHORIZATION. Each Lender and the holder of each Note
authorizes each of the Administrative Agent, the Documentation Agent and the
Issuing Bank to act on behalf of such Lender or holder to the extent provided
herein or in any document or instrument delivered hereunder or in connection
herewith, and to take such other action as may be reasonably incidental thereto.
The Lenders hereby further authorize the Collateral Agent to release any
Collateral constituting any interest in a Guarantor or a Subsidiary owning an
interest
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in any Guarantor in connection with a disposition of a minority interest in such
Subsidiary permitted by this Agreement.
SECTION 13.2 POWER. Each of the Administrative Agent and the Documentation
Agent shall have and may exercise such powers under this Agreement and the other
Loan Documents as are specifically delegated to the Administrative Agent and the
Documentation Agent by the terms hereof, together with such powers as are
reasonably incidental thereto. The Administrative Agent and the Documentation
Agent and the Issuing Bank shall not have any implied duties or any obligation
to take any action under this Agreement except any action specifically provided
by this Agreement to be taken by the Administrative Agent or the Documentation
Agent or the Issuing Bank, as the case may be.
SECTION 13.3 INDEMNIFICATION OF THE ADMINISTRATIVE AGENT, THE
DOCUMENTATION AGENT OR THE ISSUING BANK. The Lenders agree to indemnify and do
hereby indemnify each of the Administrative Agent, the Documentation Agent and
the Issuing Bank (to the extent not reimbursed by the Borrower or the
Guarantors) ratably according to the Lenders' respective Percentages from and
against any and all claims, liabilities, obligations, losses, damages,
penalties, costs, expenses and disbursements of any kind or nature whatsoever
which may be paid by, imposed on, incurred by, or asserted against any of the
Administrative Agent, the Documentation Agent or the Issuing Bank in any way
relating to or arising out of this Agreement, any Note, any Loan Document, any
Letter of Credit, or any other document executed in connection herewith or any
action taken or omitted by any of the Administrative Agent, the Documentation
Agent or the Issuing Bank under this Agreement, any Note, any other Loan
Document or any other document executed in connection herewith or therewith,
PROVIDED that no Lender shall be liable for any portion of such claims,
liabilities, obligations, losses, damages, penalties, costs, expenses and
disbursements resulting from such Administrative Agent's, Documentation Agent's
or Issuing Bank's gross negligence or wilful misconduct. Without limiting the
generality of the foregoing, each Lender agrees to reimburse each of the
Administrative Agent, the Documentation Agent and the Issuing Bank promptly upon
demand for its ratable share of any out-of-pocket expenses (including reasonable
counsel fees) incurred by any of the Administrative Agent, the Documentation
Agent or the Issuing Bank under, or in the enforcement of, or for legal advice
in respect of rights or responsibilities under, this Agreement, any Note, any
other Loan Document or any other document executed in connection herewith or
therewith to the extent that the Administrative Agent, the Documentation Agent
and the Issuing Bank are not reimbursed for such expenses by the Borrower or any
Guarantor PROVIDED that no Lender shall be liable for any such expenses
resulting from the Administrative Agent's, the Documentation Agent's or the
Issuing Bank's gross negligence or wilful misconduct. If any indemnity furnished
to any of the Administrative Agent, the Documentation Agent or the Issuing Bank
for any purpose shall, in the opinion of such Administrative Agent, such
Documentation Agent or such Issuing Bank, be insufficient or become impaired,
such Administrative Agent, Documentation Agent or such Issuing Bank may call for
additional indemnity and not commence or cease to do the acts indemnified
against until such additional indemnity is furnished.
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SECTION 13.4 ACTION ON INSTRUCTIONS OF THE REQUIRED LENDERS. As to any
matters not expressly provided for by this Agreement (including, without
limitation, enforcement or collection of the Notes), neither the Administrative
Agent, the Documentation Agent nor the Issuing Bank shall be required to
exercise any discretion or take any action, but the Administrative Agent, the
Documentation Agent and the Issuing Bank shall be required to act or to refrain
from acting (and shall be fully protected in so acting or refraining from
acting) upon the instructions of the Required Lenders, and such instructions
shall be binding upon the Lenders (including, without limitation, all subsequent
holders of the Notes); PROVIDED, HOWEVER, that neither the Administrative Agent,
the Documentation Agent the Issuing Bank shall be required to take any action
which exposes the Administrative Agent, the Documentation Agent or the Issuing
Bank to personal liability or which is contrary to this Agreement, any Loan
Document or applicable law; PROVIDED, FURTHER, HOWEVER, that neither the
Administrative Agent, the Documentation Agent nor the Issuing Bank shall be
required to do any act hereunder or under any Loan Document or any other
document or instrument delivered hereunder or in connection herewith or take any
action toward the execution or enforcement of the agency hereby created, or to
prosecute or defend any suit in respect of this Agreement, any Loan Document,
any Letter of Credit or the Notes or any collateral security, unless the
Administrative Agent, the Documentation Agent and the Issuing Bank are fully and
specifically indemnified to their satisfaction by the Lenders against any and
all claims, liabilities, obligations, losses, damages, penalties, costs,
disbursements and expenses of any kind or nature whatsoever relating to or
arising out of such action (other than any portions of such claims, liabilities,
obligations, losses, damages, penalties, costs, disbursements and expenses
resulting from such Administrative Agent's, Documentation Agent's or Issuing
Bank's gross negligence or wilful misconduct). The relationship between the
Administrative Agent, the Documentation Agent and the Issuing Bank on the one
hand and the Lenders on the other hand is and shall be that of agent and
principal only and nothing herein contained shall be construed to constitute the
Administrative Agent, the Documentation Agent or the Issuing Bank a trustee for
any holder of a Note or of a participation therein or in a Letter of Credit nor
to impose on the Administrative Agent, the Documentation Agent or the Issuing
Bank duties and obligations other than those expressly provided for herein.
SECTION 13.5 EXCULPATION. Neither the Administrative Agent nor the
Documentation Agent nor any of their respective directors, officers, employees
or agents shall (i) be responsible to the Lenders for any recitals,
representations or warranties contained in, or for the execution, validity,
genuineness, effectiveness or enforceability of this Agreement, any Note, any
Loan Document or any other instrument or document delivered hereunder or in
connection herewith, (ii) be responsible for the validity, genuineness,
perfection, effectiveness, enforceability, existence, value or enforcement of
any guaranty or collateral security, (iii) be under any duty to inquire into or
pass upon any of the foregoing matters, or to make any inquiry concerning the
performance by the Borrower or any other Obligor of its obligations, or (iv) in
any event, be liable as such for any action taken or omitted by it or them,
except for its or their own gross negligence or willful misconduct. The agency
hereby created shall in no way impair or affect any of the rights and powers of,
or impose any duties or obligations upon, the Administrative Agent and the
Documentation Agent in their individual capacity.
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SECTION 13.6 EMPLOYMENT OF COUNSEL, ETC. The Administrative Agent, the
Documentation Agent and the Issuing Bank may execute any of their respective
duties under this Agreement, any Loan Document and any instrument, agreement or
document executed, issued or delivered pursuant hereto or thereto or in
connection herewith or therewith, by or through employees, agents,
correspondents, confirming banks, and attorneys-in-fact and shall not be
answerable to the Lenders for the default or misconduct of any such employee,
agent, correspondents, confirming banks, or attorney-in-fact selected by it with
reasonable care. The Administrative Agent, the Documentation Agent and the
Issuing Bank shall be entitled to rely on advice of counsel (including counsel
who are the employees of the Administrative Agent, the Documentation Agent and
the Issuing Bank) selected by such Administrative Agent or such Documentation
Agent or such Issuing Bank concerning all matters pertaining to the agency
hereby created and its duties to the Lenders under this Agreement, any Loan
Document and any instrument, agreement or document executed, issued or delivered
pursuant hereto or thereto or in connection herewith or therewith.
SECTION 13.7 RELIANCE ON DOCUMENTS. Each of the Administrative Agent, the
Documentation Agent and the Issuing Bank shall be entitled to rely upon any
notice, consent, waiver, amendment, certificate, affidavit, letter, telegram,
statement, paper or document believed by it to be genuine and correct and to
have been signed or sent by the proper Person or Persons.
SECTION 13.8 CREDIT INVESTIGATION. Each Lender acknowledges that it has
made such inquiries and taken such care on its own behalf (including, without
limitation, that it had this Agreement, the form of its Note and the Guaranties,
the Security Documents and such other documents or matters as it deemed
appropriate relating hereto and thereto reviewed by its own legal counsel as it
deemed appropriate, and it is satisfied with the form of this Agreement, its
Note and the Security Documents) as would have been the case had the Commitments
hereunder been granted and the Borrowings made and the Letters of Credit issued
directly by such Lender to the Borrower without the intervention of the
Collateral Agent, the Administrative Agent, the Documentation Agent, the Issuing
Bank or any other Lender. Each Lender agrees and acknowledges that neither the
Administrative Agent nor the Documentation Agent nor the Issuing Bank make any
representations or warranties about the creditworthiness of the Borrower, any
Subsidiary, any Guarantor, the Parent Company, the Holding Company or any other
party to this Agreement or with respect to the legality, validity, sufficiency
or enforceability of this Agreement, any Note, any other Loan Document or the
existence or value of any collateral security therefor.
SECTION 13.9 RESIGNATION. Any of the Administrative Agent, the Issuing
Bank, and the Documentation Agent may resign as such at any time upon at least
thirty (30) days prior notice to the Borrower and the Lenders. In the event of
any such resignation of the Administrative Agent, the Borrower, with the consent
of the Documentation Agent, shall as promptly as practicable appoint a successor
agent to the Administrative Agent, which shall be the Documentation Agent. In
the event no such successor is appointed, the Required Lenders shall as promptly
as practicable appoint a successor agent to such resigning Administrative
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Agent. In the event no such successor is so appointed within thirty (30) days of
any such notice, any Lender may apply to a court of competent jurisdiction for
the appointment of a successor agent hereunder to such resigning Administrative
Agent. After any retiring Administrative Agent's or Documentation Agent's
resignation hereunder as the Administrative Agent or the Documentation Agent or
the Issuing Bank, the provisions of (i) this ARTICLE XIII shall inure to its
benefit as to any actions taken or omitted to be taken by it while it was the
Administrative Agent or Documentation Agent or the Issuing Bank, as the case may
be, under this Agreement; (ii) SECTION 14.8 shall continue to inure to its
benefit; and ARTICLE II shall continue to inure to the benefit of the Issuing
Bank.
SECTION 13.10 ANNUAL ADMINISTRATIVE AGENCY FEES. The obligations of the
Administrative Agent hereunder are subject to the condition precedent that the
Borrower shall pay to the Administrative Agent on each anniversary date of the
Effective Date until the Obligations of the Borrower are paid in full in same
day or immediately available funds a fee in an amount that has been agreed upon
by the Borrower and the Administrative Agent.
SECTION 13.11 THE ADMINISTRATIVE AGENT, ISSUING BANK AND DOCUMENTATION
AGENT AS LENDERS. With respect to any Note or other Obligation held or issued by
or owed to it, each of the Issuing Bank, the Documentation Agent and the
Administrative Agent shall have and may exercise the same rights and powers
hereunder, under the Notes and under the other Loan Documents and is subject to
the same obligations and liabilities as and to the extent set forth herein for
any other Lender. The terms "Lenders" or "Required Lenders," or "Majority
Lenders" or any similar terms shall, unless the context clearly otherwise
indicates, include the Issuing Bank, the Administrative Agent and the
Documentation Agent in their individual capacity as a Lender or as the, or one
of the, Required Lenders or Majority Lenders. The Issuing Bank, the
Administrative Agent and the Documentation Agent may lend money to and generally
engage in any kind of banking, trust or other business with the Borrower, the
Parent Company, the Holding Company, any Guarantor, any Subsidiary of any
thereof, or any other Person as if it were not acting pursuant hereto.
ARTICLE XIV
MISCELLANEOUS PROVISIONS
SECTION 14.1 NO WAIVER. No delay on the part of the Administrative Agent,
the Documentation Agent, the Issuing Bank or any Lender in the exercise of any
right, power or remedy shall operate as a waiver thereof, nor shall any single
or partial exercise by any of them of any right, power or remedy preclude any
other or further exercise thereof, or the exercise of any other right, power or
remedy.
SECTION 14.2 AMENDMENTS, MODIFICATIONS, WAIVERS AND CONSENTS. No amendment
to, modification or waiver of, or consent with respect to, any provision of this
Agreement or the Notes shall in any event be effective unless the same shall be
in writing and signed and delivered by the Required Lenders or by the
Administrative Agent on behalf of and with the written consent of the Required
Lenders to the Borrower or, as to any provision of this Agreement or the Notes,
which only may be amended by the Lenders, by the Lenders or by the
Administrative Agent on behalf of and
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with the written consent of the Lenders, to the Borrower and then any such
amendment, modification, waiver or consent shall be effective only in the
specific instance and for the specific purpose for which given. No amendment,
modification, waiver or consent (i) shall affect this sentence, increase the
amount of any of the Commitments of the Lenders hereunder, extend the maturity
of any Borrowing, postpone or forgive the payment of interest thereon, reduce
the amount in SECTION 5.3, postpone or reduce the fees hereunder (other than
fees payable to the Issuing Bank pursuant to SECTION 4.5(B) and the fees payable
to the Administrative Agent pursuant to SECTION 13.10), reduce the rate of
interest payable with respect to any Borrowing, release any collateral security
for any Obligation (including without limitation any Guaranty), except as
otherwise specifically provided in any Loan Document, or reduce the aggregate
percentage required to effect an amendment, modification, waiver or consent
without the unanimous consent of the Lenders, or (ii) shall extend the maturity
of, postpone or forgive the payment of interest on, extend the due date for any
scheduled repayment or prepayment of principal of, or reduce the principal
amount of, or rate of interest on, any Borrowing (A) without the consent of the
holder of the Note evidencing such Borrowing in the case of any such extension,
postponement, forgiveness or reduction relating to Loans or (B) without the
consent of the Issuing Bank and all the Lenders in the case of any such
extension, postponement, forgiveness or reduction relating to Letters of Credit.
No provisions of ARTICLE XIII (or of this sentence) shall be deleted, amended,
modified or waived without the consent of the Administrative Agent, the Issuing
Bank and the Documentation Agent. No provisions of SECTION 2.4 (or of this
sentence) shall be deleted, amended, modified or waived without the consent of
the Issuing Bank.
SECTION 14.3 CONFIRMATIONS. The Borrower and each holder of a Note agree
from time to time, upon written request received by it from the other, to
confirm to the other in writing the aggregate unpaid principal amount of the
Loans then outstanding under such Note; and each such holder agrees from time to
time, upon written request received by it from the Borrower, to make that Note
held by it (including the schedule attached thereto) available for reasonable
inspection by the Borrower, at the office of such holder.
SECTION 14.4 NOTICES, DEMANDS, INSTRUCTIONS AND OTHER COMMUNICATIONS. All
notices, demands, instructions and other communications required or permitted to
be given to or made upon any party hereto shall be in writing and shall be
personally delivered or sent by registered or certified mail, postage prepaid,
return receipt requested, or by telecopier; PROVIDED, HOWEVER that no Borrowing
Request and no conversion notice pursuant to ARTICLE VI shall become effective
until actually received by the Administrative Agent and no Issuance Request
shall become effective until actually received by the Issuing Bank, and shall be
deemed to be given for purposes of this Agreement on the day that such writing
is delivered or sent to the intended recipient thereof in accordance with the
provisions of this SECTION 14.4. Unless otherwise specified in a notice sent or
delivered in accordance with the foregoing provisions of this SECTION 14.4,
notices, demands, instructions and other communications shall be given to or
made upon the respective parties hereto at their respective addresses (or to
their respective telecopier
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numbers) indicated on SCHEDULE I, or as set forth in the relevant Assignment and
Acceptance, as the case may be.
SECTION 14.5 ACCOUNTING TERMS AND COMPUTATIONS. Wherever any accounting
term shall be used herein or in any other Loan Document, or the character or
amount of any asset or liability or item of income or expense is required to be
determined, or any consolidation or other accounting computation is required to
be made, for the purposes of this Agreement and each other Loan Document, such
accounting term, such determination or such computation shall, to the extent
applicable and except as otherwise specified in this Agreement or such other
Loan Document, be defined or made (as the case may be) in accordance with
generally accepted accounting principles ("GAAP") applied (in the case of
determinations or computations) on a basis consistent with those in effect at
the time of such determination or computation. In the event any changes in GAAP
after the Effective Date would materially affect the calculation of the
financial covenants in SECTION 9.4 or of the Leverage Ratio or Consolidated
Stockholders' Equity, the Borrower and the Lenders agree to enter into good
faith negotiations for an agreement to revise such financial covenants or the
definitions of "LEVERAGE RATIO" or "CONSOLIDATED STOCKHOLDERS' EQUITY" or
"STOCKHOLDER'S EQUITY" to take into account such changes in GAAP; PROVIDED that
until the Borrower and the Lenders have entered into such an agreement, such
financial calculations shall continue to be made in accordance with GAAP as in
effect immediately prior to such change.
SECTION 14.6 SALES AND TRANSFERS, ETC., OF BORROWINGS AND NOTES;
PARTICIPATIONS IN BORROWINGS AND NOTES.
(a) Any Lender may at any time sell to one or more banks or other
entities (other than a direct competitor of the Borrower or
any of its Subsidiaries or a person engaged as one of its
principal activities in the Hydrocarbons transportation,
marketing or storage business ("PARTICIPANTS")) participating
interests in any Borrowing owing to such Lender, any Note held
by such Lender, any Commitment of such Lender or any other
interest of such Lender hereunder, PROVIDED that no Lender may
sell any participating interests in any such Borrowing, Note,
Commitment or other interest hereunder without also selling to
such Participant the appropriate PRO RATA share of such
Borrowings, Notes, Commitments and other interests hereunder
and the appropriate PRO RATA share of the A-Notes, the
Lessor's A-Invested Amount, the B-Notes and the Lessor's
B-Invested Amount under the Operative Documents and the
Operative Loan Documents (as defined in the Operative
Documents), and PROVIDED FURTHER that no Lender shall
transfer, grant or assign any participation under which the
participant shall have rights to approve any amendment to or
waiver of this Agreement except to the extent such amendment
or waiver would (i) increase the amount of such Lender's
Commitment, (ii) reduce the principal of, or interest on, any
of such Lender's Borrowings, or any fees payable to such
Lender hereunder, (iii) postpone any date fixed for any
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scheduled payment of principal of, or interest on, any of such
Lender's Borrowings, or any fees or other amounts payable to
such Lender hereunder or (iv) release all or substantially all
collateral security for any Obligation (including, without
limitation, any Guaranty), except as otherwise specifically
provided in any Loan Document. In the event of any such sale
by a Lender of participating interests to a Participant, such
Lender's obligations under this Agreement to the other parties
to this Agreement shall remain unchanged, such Lender shall
remain solely responsible for the performance thereof, such
Lender shall remain the holder of any such Note for all
purposes under this Agreement and the Borrower, the
Administrative Agent and the Documentation Agent shall
continue to deal solely and directly with such Lender in
connection with such Lender's rights and obligations under
this Agreement. The Borrower agrees that if amounts
outstanding under this Agreement and the Notes are due and
unpaid, or shall have been declared or shall have become due
and payable upon the occurrence of an Event of Default, each
Participant shall be deemed to have the right of setoff in
respect of its participating interest in amounts owing under
this Agreement and any Note to the same extent as if the
amount of its participating interest were owing directly to it
as a Lender under this Agreement or any Note; PROVIDED that
such right of setoff shall be subject to the obligation of
such Participant to share with the Lenders, and the Lenders
agree to share with such Participant, as provided in SECTION
7.2. The Borrower also agrees that each Participant shall be
entitled to the benefits of SECTIONS 2.6, 4.9, 4.12 and 4.14
with respect to its participation in the Commitments and the
Borrowings outstanding from time to time; PROVIDED that no
Participant shall be entitled to receive any greater amount
pursuant to such Sections than the transferor Lender would
have been entitled to receive in respect of
the amount of the participation transferred by such transferor
Lender to such Participant had no such transfer occurred.
(b) Any Lender may at any time sell to any Lender or any affiliate
thereof, and, with the consent of the Administrative Agent and
the Issuing Bank and the Borrower (which shall not be
unreasonably withheld or delayed), to one or more banks or
financial institutions ("PURCHASING LENDERS") all or any part
of its rights and obligations under this Agreement, the Notes
and the other Loan Documents, pursuant to an Assignment and
Acceptance in the form attached as EXHIBIT 14.6 hereto,
executed by such Purchasing Lender, such transferor Lender
(and, in the case of a Purchasing Lender which is not then a
Lender or an affiliate thereof, consented to by the Borrower
and the Administrative Agent and the Issuing Bank) and the
Administrative Agent and delivered to the Administrative
Agent; PROVIDED that each such sale to a Purchasing Lender
shall be in an amount of $5,000,000 or more; and PROVIDED,
FURTHER, that
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no Lender may sell any Loans to a Purchasing Lender without
also selling to such Purchasing Lender the appropriate PRO
RATA share of its Borrowings and participations in Letters of
Credit hereunder, and its Commitments hereunder and the
appropriate PRO RATA share of the A-Notes, the Lessor's
A-Invested Amount, the B-Notes and the Lessor's B-Invested
Amount under the Operative Documents and the Operative Loan
Documents (as defined in the Operative Documents). Upon such
execution, delivery and acceptance, from and after the
Transfer Effective Date determined pursuant to such Assignment
and Acceptance (x) the Purchasing Lender thereunder shall be a
party hereto and, to the extent provided in such Assignment
and Acceptance, have the rights and obligations of a Lender
hereunder and under the other Loan Documents with a Commitment
as set forth therein and (y) the transferor Lender thereunder
shall, to the extent provided in such Assignment and
Acceptance be released from its obligations under this
Agreement and under the other Loan Documents (and, in the case
of an Assignment and Acceptance covering all or the remaining
portion of a transferor Lender's rights and obligations under
this Agreement and under the other Loan Documents, such
transferor Lender shall cease to be a party hereto). Such
Assignment and Acceptance shall be deemed to amend this
Agreement to the extent, and only to the extent, necessary to
reflect the addition of such Purchasing Lender and the
resulting adjustment of Commitments and Percentages arising
from the purchase by such Purchasing Lender of all or a
portion of the rights and obligations of such transferor
Lender under this Agreement, the Notes and the other Loan
Documents. On or prior to the Transfer Effective Date
determined pursuant to such Assignment and Acceptance, the
Borrower at its own expense, shall execute and deliver to the
Administrative Agent in exchange for any surrendered Note, a
new Note to the order of such Purchasing Lender in an amount
equal to the Commitments assumed by it pursuant to such
Assignment and Acceptance, and, if the transferor Lender has
retained a Commitment or Borrowing hereunder, a new Note to
the order of the transferor Lender in an amount equal to the
Commitments or Borrowings retained by it hereunder. Such new
Notes shall be dated the Initial Borrowing Date and shall
otherwise be in the form of the Notes replaced thereby. The
Notes surrendered by the transferor Lender shall be returned
by the Administrative Agent to the Borrower marked
"cancelled."
(c) Upon its receipt of an Assignment and Acceptance executed by a
transferor Lender and a Purchasing Lender (and, in the case of
a Purchasing Lender that is not then a Lender or an affiliate
thereof, consented to by the Borrower, the Administrative
Agent and the Issuing Bank (if the consent of the Borrower and
the Administrative Agent and the Issuing Bank is required))
and the Administrative Agent, together with
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payment to the Administrative Agent hereunder of a
registration and processing fee of $2,500 and to the
Administrative Agent (as defined in the Participation
Agreement) the registration and processing fee referred to in
Section 6.3 of the Participation Agreement (provided, a Lender
being replaced pursuant to SECTION 4.15 shall have no
obligation to pay such registration and processing fees), the
Administrative Agent shall (i) promptly accept such Assignment
and Acceptance and (ii) on the Transfer Effective Date
determined pursuant thereto give notice of such acceptance and
recordation to the Lenders and the Borrower.
(d) The provisions of the foregoing CLAUSES (B) and (C) shall not
apply to or restrict, or require the consent of or any notice
to any Person to effectuate, the pledge or assignment by any
Lender of its rights under this Agreement and its Notes to any
Federal Reserve Bank.
(e) If, pursuant to this SECTION 14.6 any interest in this
Agreement or any Note is transferred to any transferee (a
"TRANSFEREE") which is organized under the laws of any
jurisdiction other than the United States or any State
thereof, the transferor Lender shall cause such Transferee,
concurrently with the effectiveness of such transfer, (i) to
represent to the transferor Lender (for the benefit of the
transferor Lender, the Administrative Agent, the Issuing Bank,
the Documentation Agent and the Borrower) that under
applicable law and treaties no taxes will be required to be
withheld by the Administrative Agent, the Borrower or the
transferor Lender with respect to any payments to be made to
such Transferee in respect of the Loans or Letters of Credit,
(ii) to furnish to the transferor Lender (and, in the case of
any Purchasing Lender, the Administrative Agent, the Issuing
Bank, the Documentation Agent and the Borrower) either U.S.
Internal Revenue Service Form 4224 or U.S. Internal Revenue
Service Form 1001 (wherein such Transferee claims entitlement
to complete exemption from U.S. federal withholding tax on all
interest payments hereunder) and (iii) to agree (for the
benefit of the transferor Lender, the Administrative Agent,
the Issuing Bank, the Documentation Agent and the Borrower) to
provide the transferor Lender (and, in the case of any
Purchasing Lender, the Administrative Agent, the Issuing Bank,
the Documentation Agent and the Borrower) a new Form 4224 or
Form 1001 upon the expiration or obsolescence of any
previously delivered form and comparable statements in
accordance with applicable U.S. laws and regulations and
amendments duly executed and completed by such Transferee, and
to comply from time to time with all applicable U.S. laws and
regulations with regard to such withholding tax exemption.
(f) On the Effective Date, the aggregate principal balance of the
obligations outstanding under the Original Credit Agreement is
$195,780,000 (the
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"Prior Indebtedness") as shown on SCHEDULE II, and Borrower
represents for itself and each Lender represents and warrants
for itself, that its outstanding loans and letter of credit
reimbursement obligations, if any, under the Original Credit
Agreement as of the Effective Date are as set forth in the
second column of SCHEDULE II. Lenders hereby sell, assign,
transfer and convey, and Lenders (including, without
limitation, those Lenders not previously a party to the
Original Credit Agreement) hereby purchase and accept so much
of the Prior Indebtedness and all of the rights, titles,
benefits, interests, privileges, claims, liens, security
interests, and obligations existing and to exist (collectively
the "INTERESTS") such that each Lender's Percentage of the
outstanding Loans and Commitments under the Original Credit
Agreement as amended and restated by this Agreement shall be
as set forth in SCHEDULE II as of the Effective Date. The
foregoing assignment, transfer and conveyance are without
recourse to the Lenders and without any warranties whatsoever
as to title, enforceability, collectibility, documentation or
freedom from liens or encumbrances, in whole or in part, other
than the warranty by each Lender that it has not sold,
transferred, conveyed or encumbered such Interests. If as a
result thereof, a Lender's Percentage of the outstanding
Borrowings under this Agreement is less than its outstanding
loans and letter of credit reimbursement obligations under the
Original Credit Agreement on the Effective Date, the
difference set forth in the last column of SCHEDULE II shall
be remitted to such Lender by the Administrative Agent upon
receipt of funds from the other Lenders shown in the last
column of SCHEDULE II on the Effective Date. Each Lender so
acquiring a part of such outstanding loans and letter of
credit reimbursement obligations assumes its Percentage of the
outstanding Borrowings, Commitments, rights, titles,
interests, privileges, claims, liens, security interests,
benefits and obligations under this Agreement and the Security
Documents. Lenders are proportionately released from the
obligations assumed by Lenders so acquiring such obligations
and, to that extent, the Lenders so released shall have no
further obligation under the Original Credit Agreement, as
amended and restated hereby. The Borrower hereby represents
and warrants that it has no defenses, offsets or counterclaims
to the Prior Indebtedness or its obligations or rights under
the Original Credit Agreement, this Agreement or the Security
Documents, including, without limitation, the Interests being
assigned pursuant to this SECTION 14.6(F). Any Loans
outstanding under the Original Credit Agreement on the
Effective Date bearing interest at a Eurodollar Interest Rate
(as defined in the Original Credit Agreement) shall be deemed
continued as a Loan under this Agreement at such Eurodollar
Interest Rate and for the Interest Period with respect thereto
under the Original Credit Agreement.
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SECTION 14.7 PAYMENT OF COSTS, EXPENSES AND TAXES. The Borrower agrees to
pay on demand all out-of-pocket costs and expenses of the Administrative Agent,
the Collateral Agent, the Issuing Bank and the Documentation Agent (including,
without limitation, the reasonable fees and out-of-pocket expenses of Messrs.
Xxxxx, Xxxxx & Xxxxx, and any and all other special counsel for the Agents, and
of local counsel, if any, who may be retained by said special counsel) in
connection with (i) the preparation, negotiation, execution, delivery,
syndication and administration of this Agreement, the Notes, the Guaranties, the
Security Documents, and all other instruments or documents provided for herein
or delivered or to be delivered hereunder or in connection herewith, (ii) the
preparation, negotiation, execution and delivery of any and all amendments,
supplements, renewals, restatements, rearrangements, extensions, substitutions,
or modifications to this Agreement, the Notes, the Guaranties, the Security
Documents, and all other instruments or documents provided for herein or
delivered or to be delivered hereunder or in connection herewith except for
those (excluding the preparation of new Notes) incurred in connection with
SECTION 14.6 unless such sale, assignment, or transfer under SECTION 14.6
results from the exercise of Borrower's rights under SECTION 4.15, and (iii) the
enforcement by the Lenders, the Administrative Agent, the Issuing Bank, the
Collateral Agent and the Documentation Agent of, or the protection of rights
under, this Agreement, the Notes, the Guaranties, the Security Documents, any
such other instruments or documents or any collateral security. The
Administrative Agent, the Collateral Agent, each Lender, the Issuing Bank and
the Documentation Agent agree to the extent feasible, and to the extent a
conflict of interest does not exist in the reasonable opinion of the
Administrative Agent, any Lender, the Collateral Agent, the Issuing Bank, the
Documentation Agent or their counsel, to use the same single counsel (i.e. one
law firm) in connection with the foregoing, to the extent they seek
reimbursement for the expenses thereof from the Borrower. Such requests for
payment shall be accompanied by invoices containing reasonable details. Each
Lender agrees to reimburse each of the Administrative Agent, the Collateral
Agent, the Issuing Bank and the Documentation Agent on demand for such Lender's
PRO RATA share (based upon its respective Percentage) of any such costs or
expenses not paid by the Borrower. In addition, the Borrower agrees to pay, and
to save the Administrative Agent, the Collateral Agent and the Documentation
Agent and the Lenders harmless from all liability for, any stamp or other taxes
which may be payable in connection with the execution or delivery of this
Agreement, the Borrowings hereunder, or the issuance of the Notes, the Letters
of Credit, or of any other instruments or documents provided for herein or
delivered or to be delivered hereunder or in connection herewith. All
obligations provided for in this SECTION 14.7, in the last paragraph of SECTION
2.4.2 and in SECTION 2.6, SECTION 4.9, SECTION 4.10, SECTION 4.12, SECTION 4.14
and SECTION 14.8 shall survive any termination of this Agreement. The
representations and warranties made by the Borrower in this Agreement and in
each other Loan Document shall survive the execution and delivery of this
Agreement and each such other Loan Document.
SECTION 14.8 INDEMNIFICATION PROVISIONS. IN CONSIDERATION OF THE EXECUTION
AND DELIVERY OF THIS AGREEMENT BY THE ADMINISTRATIVE AGENT, THE COLLATERAL
AGENT, THE ISSUING BANK AND THE DOCUMENTATION AGENT AND EACH LENDER, THE
BORROWER HEREBY AGREES TO INDEMNIFY EACH OF THE ADMINISTRATIVE AGENT, THE
COLLATERAL AGENT, THE ISSUING BANK AND THE DOCUMENTATION AGENT AND EACH LENDER
AND THEIR RESPECTIVE DIRECTORS, OFFICERS, AGENTS
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AND EMPLOYEES (COLLECTIVELY, THE "INDEMNIFIED PARTIES") FROM AND AGAINST
ANY AND ALL SUITS, LOSSES, LIABILITIES, CLAIMS AND DAMAGES, AND EXPENSES
INCURRED BY ANY OF THE INDEMNIFIED PARTIES RELATING TO, ARISING OUT OF OR BY
REASON OF (I) ANY INVESTIGATION, LITIGATION OR OTHER PROCEEDING RELATED TO ANY
USE MADE OR PROPOSED TO BE MADE BY THE BORROWER OF THE PROCEEDS OF THE
BORROWINGS, OR ANY TRANSACTION FINANCED OR TO BE FINANCED IN WHOLE OR IN PART,
DIRECTLY OR INDIRECTLY WITH THE PROCEEDS OF ANY BORROWING, (II) THE ENTERING
INTO AND PERFORMANCE OF THIS AGREEMENT AND ANY OTHER LOAN DOCUMENT BY ANY OF THE
INDEMNIFIED PARTIES (OTHER THAN EXPENSES OF THE TYPE FOR WHICH THE BORROWER
AGREES TO REIMBURSE PURSUANT TO SECTION 14.7), (III) ANY INVESTIGATION,
LITIGATION OR PROCEEDING RELATED TO ANY ENVIRONMENTAL CLEANUP, AUDIT, COMPLIANCE
OR OTHER MATTER RELATING TO ANY ENVIRONMENTAL LAW OR THE CONDITION OF ANY
FACILITY OR PROPERTY OWNED, LEASED OR OPERATED BY THE BORROWER OR ANY OF ITS
SUBSIDIARIES, OR (IV) THE PRESENCE ON OR UNDER, OR THE ESCAPE, SEEPAGE, LEAKAGE,
SPILLAGE, DISCHARGE, EMISSION, DISCHARGING OR RELEASES FROM, ANY FACILITY OR
PROPERTY OWNED, LEASED OR OPERATED BY THE BORROWER OR ANY SUBSIDIARY THEREOF OF
ANY HAZARDOUS MATERIAL (INCLUDING, WITHOUT LIMITATION, ANY LOSSES, LIABILITIES,
DAMAGES, INJURIES, COSTS, EXPENSES OR CLAIMS ASSERTED OR ARISING UNDER ANY
ENVIRONMENTAL LAW), REGARDLESS OF WHETHER CAUSED BY, OR WITHIN THE CONTROL OF,
THE BORROWER OR SUCH SUBSIDIARY (BUT EXCLUDING ANY SUCH LOSSES, LIABILITIES,
CLAIMS, DAMAGES OR EXPENSES TO THE EXTENT THEY RESULTED FROM THE GROSS
NEGLIGENCE OR WILLFUL MISCONDUCT OF SUCH INDEMNIFIED PARTY OR OF ITS RESPECTIVE
DIRECTORS, OFFICERS, AGENTS OR EMPLOYEES OR RESULTED FROM SUCH INDEMNIFIED
PARTY'S OWN UNEXCUSED BREACH OF ANY MATERIAL PROVISION OF ANY LOAN DOCUMENT),
PROVIDED THAT IT IS THE INTENTION OF THE PARTIES HERETO THAT THE INDEMNIFIED
PARTIES BE INDEMNIFIED IN THE CASE OF THEIR OWN NEGLIGENCE. IF AND TO THE EXTENT
THAT THE FOREGOING UNDERTAKING MAY BE UNENFORCEABLE FOR ANY REASON, THE BORROWER
HEREBY AGREES, TO THE MAXIMUM EXTENT PERMITTED BY APPLICABLE LAW, TO MAKE THE
MAXIMUM CONTRIBUTION TO THE PAYMENT AND SATISFACTION OF EACH OF SUCH LOSSES,
LIABILITIES, CLAIMS, DAMAGES, EXPENSES, FEES AND DISBURSEMENTS WHICH IS
PERMISSIBLE UNDER APPLICABLE LAW. THE COLLATERAL AGENT, THE ADMINISTRATIVE
AGENT, THE DOCUMENTATION AGENT, THE ISSUING BANK AND EACH LENDER AGREE TO THE
EXTENT FEASIBLE, AND TO THE EXTENT A CONFLICT OF INTEREST DOES NOT EXIST IN THE
REASONABLE OPINION OF ANY OF THE COLLATERAL AGENT, THE ADMINISTRATIVE AGENT, THE
DOCUMENTATION AGENT, THE ISSUING BANK OR ANY LENDER OR THEIR COUNSEL, TO USE THE
SAME SINGLE COUNSEL (I.E. ONE LAW FIRM) IN CONNECTION WITH ANY SUCH
INVESTIGATION, LITIGATION OR OTHER PROCEEDING. ALL OBLIGATIONS PROVIDED FOR IN
THIS SECTION 14.8 SHALL SURVIVE ANY TERMINATION OF THIS AGREEMENT, THE PAYMENT
OF THE OBLIGATIONS AND THE ASSIGNMENT OF THE NOTES.
SECTION 14.9 SUBSIDIARY REFERENCES. The provisions of this Agreement
relating to Subsidiaries shall apply only during such times as the Borrower has
one or more Subsidiaries.
SECTION 14.10 SECTION CAPTIONS AND TABLE OF CONTENTS. Section captions
used in, and the Table of Contents to, this Agreement are for convenience of
reference only, and shall not affect the construction of this Agreement.
SECTION 14.11 GOVERNING LAW. THIS AGREEMENT AND EACH NOTE SHALL BE DEEMED
TO BE A CONTRACT MADE UNDER THE LAWS OF THE
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STATE OF NEW YORK, AND FOR ALL PURPOSES SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF SAID STATE. All obligations of the Borrower and
rights of the Collateral Agent, the Administrative Agent, the Issuing Bank, the
Documentation Agent, the Lenders and any other holders of the Notes expressed
herein or in the Notes shall be in addition to and not in limitation of those
provided by applicable law.
SECTION 14.12 EXECUTION IN COUNTERPARTS. This Agreement 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 but one and the same Agreement.
SECTION 14.13 SUCCESSORS AND ASSIGNS. This Agreement shall be binding upon
the Borrower, the Lenders, the Administrative Agent and the Documentation Agent
and their respective successors and assigns, and shall inure to the benefit of
the Borrower, the Lenders, the Collateral Agent, the Administrative Agent, the
Issuing Bank and the Documentation Agent and the respective successors and
assigns of the Lenders, the Collateral Agent, the Administrative Agent, the
Issuing Bank and the Documentation Agent; PROVIDED, HOWEVER, that the Borrower
may not assign or transfer its rights or obligations hereunder without the prior
written consent of all Lenders; PROVIDED FURTHER, however, that for purposes of
this SECTION 14.13 if the survivor of such a merger is obligated in respect of
all Obligations of the Borrower hereunder and under all other Loan Documents, a
merger permitted pursuant to SECTION 9.3.6 hereof shall not be an assignment or
transfer of the Borrower's rights or obligations hereunder.
SECTION 14.14 WAIVER OF JURY TRIAL. TO THE FULLEST EXTENT PERMITTED BY
APPLICABLE LAW, EACH PARTY HERETO WAIVES ANY RIGHT TO A TRIAL BY JURY IN ANY
ACTION OR PROCEEDING TO ENFORCE OR DEFEND ANY RIGHTS UNDER THIS AGREEMENT OR
UNDER ANY AMENDMENT, INSTRUMENT, DOCUMENT OR AGREEMENT DELIVERED OR WHICH MAY IN
THE FUTURE BE DELIVERED IN CONNECTION HEREWITH OR ARISING FROM ANY BANKING
RELATIONSHIP EXISTING IN CONNECTION WITH THIS AGREEMENT, AND AGREES THAT ANY
SUCH ACTION OR PROCEEDING SHALL BE TRIED BEFORE A COURT AND NOT BEFORE A JURY.
SECTION 14.15 FORUM SELECTION AND CONSENT TO JURISDICTION. TO THE FULLEST
EXTENT PERMITTED BY APPLICABLE LAW, ANY LITIGATION BASED HEREON, OR ARISING OUT
OF, UNDER, OR IN CONNECTION WITH, THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT, OR
ANY COURSE OF CONDUCT, COURSE OF DEALING, STATEMENTS (WHETHER VERBAL OR WRITTEN)
OR ACTIONS OF THE DOCUMENTATION AGENT, THE ADMINISTRATIVE AGENT, THE ISSUING
BANK, THE COLLATERAL AGENT, THE LENDERS OR THE BORROWER SHALL BE BROUGHT AND
MAINTAINED EXCLUSIVELY IN THE COURTS OF THE STATE OF NEW YORK OR IN THE UNITED
STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT OF NEW YORK; PROVIDED, HOWEVER,
THAT ANY SUIT SEEKING ENFORCEMENT AGAINST ANY OBLIGOR, COLLATERAL OR OTHER
PROPERTY MAY BE
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BROUGHT, AT THE COLLATERAL AGENT'S OPTION, IN THE COURTS OF ANY JURISDICTION
WHERE SUCH OBLIGOR, COLLATERAL OR OTHER PROPERTY MAY BE FOUND. TO THE FULLEST
EXTENT PERMITTED BY APPLICABLE LAW, THE BORROWER HEREBY EXPRESSLY AND
IRREVOCABLY SUBMITS TO THE JURISDICTION OF THE COURTS OF THE STATE OF NEW YORK
AND THE UNITED STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT OF NEW YORK FOR
THE PURPOSE OF ANY SUCH LITIGATION AS SET FORTH ABOVE AND IRREVOCABLY AGREES TO
BE BOUND BY ANY JUDGMENT RENDERED THEREBY IN CONNECTION WITH SUCH LITIGATION. TO
THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, THE BORROWER FURTHER IRREVOCABLY
CONSENTS TO THE SERVICE OF PROCESS, BY REGISTERED MAIL, POSTAGE PREPAID, OR BY
PERSONAL SERVICE WITHIN OR WITHOUT THE STATE OF NEW YORK. TO THE FULLEST EXTENT
PERMITTED BY APPLICABLE LAW, THE BORROWER HEREBY EXPRESSLY AND IRREVOCABLY
WAIVES, TO THE FULLEST EXTENT PERMITTED BY LAW, ANY OBJECTION WHICH IT MAY HAVE
OR HEREAFTER MAY HAVE TO THE LAYING OF VENUE OF ANY SUCH LITIGATION BROUGHT IN
ANY SUCH COURT REFERRED TO ABOVE AND ANY CLAIM THAT ANY SUCH LITIGATION HAS BEEN
BROUGHT IN AN INCONVENIENT FORUM. TO THE EXTENT THAT THE BORROWER HAS OR
HEREAFTER MAY ACQUIRE ANY IMMUNITY FROM JURISDICTION OF ANY COURT OR FROM ANY
LEGAL PROCESS (WHETHER THROUGH SERVICE OF NOTICE, ATTACHMENT PRIOR TO JUDGMENT,
ATTACHMENT IN AID OF EXECUTION OR OTHERWISE) WITH RESPECT TO ITSELF OR ITS
PROPERTY, THE BORROWER HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT
PERMITTED BY APPLICABLE LAW, SUCH IMMUNITY IN RESPECT OF ITS OBLIGATIONS UNDER
THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS.
SECTION 14.16 SEVERABILITY. Any provision of this Agreement or any other
Loan Document which is prohibited or unenforceable in any jurisdiction shall, as
to such provision and such jurisdiction, be ineffective to the extent of such
prohibition or unenforceability without invalidating the remaining provisions of
this Agreement or such Loan Document or affecting the validity or enforceability
of such provision in any other jurisdiction.
SECTION 14.17 CONFIDENTIALITY. Each Lender agrees that it will use
reasonable efforts not to disclose without the prior written consent of the
Borrower (other than to its employees, affiliates, auditors or counsel or to any
other party hereto) any information with respect to the Borrower, any of its
Subsidiaries or the Parent Company or any of its Subsidiaries which is furnished
pursuant to this Agreement or any other agreement executed pursuant hereto and
which is clearly designated by the Borrower to each Lender in writing as
confidential, PROVIDED that the foregoing shall not apply to, and each Lender
may disclose any such information, (a) as has become generally available to the
public, (b) to any of its examiners or as may be required or appropriate in any
report, statement or testimony submitted to any municipal, state or Federal
regulatory body having or claiming to have jurisdiction over such Lender or to
the Federal Reserve Board or the Federal Deposit Insurance Corporation or
similar
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organizations (whether in the United States or elsewhere) or their successors,
(c) as may be required or appropriate in response to any summons or subpoena or
in connection with any litigation, (d) in order to comply with any law, order,
regulation or ruling applicable to such Lender, (e) to the prospective
Transferee, Participant, or Purchasing Lender, in connection with any
contemplated transfer of any of the Notes or any interest therein by such
Lender, PROVIDED, that such prospective Transferee, Participant, or Purchasing
Lender (other than an affiliate of such Lender) executes an agreement with the
Borrower containing provisions substantially identical to those contained in
this SECTION 14.17, (f) with the prior written authorization of the Borrower,
(g) received by such Lender prior to June 6, 1996 or already known by, or in the
possession of such Lender without restrictions on the disclosure thereof at the
time such information was received by the Lender (it being acknowledged by each
of the Lenders that all information received from the Parent Company, any
Subsidiary thereof, or the Borrower prior to June 6, 1996 was confidential) or
(h) in connection with the exercise of any remedies by any Lender, the
Administrative Agent, the Issuing Bank, the Documentation Agent or the
Collateral Agent. Each Lender further agrees that it will use its reasonable
efforts to advise the Borrower, as promptly as practicable, of any disclosure of
information clearly designated by the Borrower to each Lender in writing as
confidential made by such Lender pursuant to CLAUSE (C) of this SECTION 14.17;
PROVIDED, HOWEVER, that the foregoing notwithstanding, such Lender shall have no
obligation to notify the Borrower of any such disclosure pursuant to such CLAUSE
(C) or otherwise and failure to give such notification shall not give rise to a
claim against such Lender.
SECTION 14.18 RELEASE OF PARENT COMPANY GUARANTY. On the Effective Date,
the Parent Company shall be released from its obligations as guarantor under its
Guaranty dated as of June 6, 1996.
SECTION 14.19 NOTICE. THIS WRITTEN AGREEMENT TOGETHER WITH THE OTHER LOAN
DOCUMENTS REPRESENTS THE FINAL AGREEMENT BETWEEN THE PARTIES AND MAY NOT BE
CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS, OR SUBSEQUENT ORAL
AGREEMENTS OF THE PARTIES.
THERE ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN THE PARTIES.
101
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by their respective officers thereunto duly authorized as of the day
and year first above written.
TRANSOK, INC.
By:
Name:
Title:
BANK OF MONTREAL, HOUSTON AGENCY, as
Administrative Agent and as a Lender
By:
Name:
Title:
CANADIAN IMPERIAL BANK OF COMMERCE,
as Documentation Agent and as a Lender
By:
Name:
Title:
THE BANK OF NEW YORK
By:
Name:
Title:
BANKERS TRUST COMPANY
By:
Name:
Title:
BANQUE PARIBAS
By:
Name:
Title:
By:
Name:
Title:
CHRISTIANA BANK OG KREDITKASSE
By:
Name:
Title:
By:
Name:
Title:
CITIBANK N.A.
By:
Name:
Title:
CREDIT LYONNAIS
By:
Name:
Title:
CREDIT SUISSE
By:
Name:
Title:
By:
Name:
Title:
THE FIRST NATIONAL BANK OF CHICAGO
By:
Name:
Title:
THE FUJI BANK, LIMITED
By:
Name:
Title:
XXXXXX GUARANTY TRUST COMPANY OF
NEW YORK
By:
Name:
Title:
LONG TERM CREDIT BANK OF JAPAN,
LIMITED
By:
Name:
Title:
MELLON BANK, N.A.
By:
Name:
Title:
NATIONAL WESTMINSTER BANK PLC.,
NEW YORK BRANCH
By:
Name:
Title:
NATIONAL WESTMINSTER BANK PLC.,
NASSAU BRANCH
By:
Name:
Title:
NATIONSBANK OF TEXAS, N.A.
By:
Name:
Title:
SOCIETE GENERALE, SOUTHWEST AGENCY
By:
Name:
Title:
TEXAS COMMERCE BANK NATIONAL
ASSOCIATION
By:
Name:
Title:
TORONTO DOMINION (TEXAS), INC.
By:
Name:
Title:
UNION BANK OF CALIFORNIA, N.A.
By:
Name:
Title:
UNION BANK OF SWITZERLAND,
HOUSTON AGENCY
By:
Name:
Title:
By:
Name:
Title:
XXXXX FARGO BANK (TEXAS) N.A.
By:
Name:
Title:
CAISSE NATIONALE DE CREDIT AGRICOLE
By:
Name:
Title:
BANK OF AMERICA NATIONAL TRUST AND
SAVINGS ASSOCIATION
By:
Name:
Title:
BANK OF TOKYO-MITSUBISHI, LTD.
By:
Name:
Title:
BANK OF NOVA SCOTIA, ATLANTA AGENCY
By:
Name:
Title:
THE SUMITOMO BANK, LIMITED
By:
Name:
Title:
By:
Name:
Title:
For purposes of selling, assigning, transferring and conveying its
Interest, the undersigned has caused this Agreement to be executed by its
officer thereunto duly authorized as of the date and year first above written.
BANK OF BOSTON
By:
Name:
Title:
