CREDIT AGREEMENT dated as of May 16, 2019 among BRIGHAM RESOURCES, LLC as Borrower, The Financial Institutions Party Hereto, as Banks, WELLS FARGO BANK, N.A., as Administrative Agent, and WELLS FARGO SECURITIES, LLC, as Sole Lead Arranger and Sole...
EX. 10.13
Execution Version
Deal CUSIP Number: 00000XXX0 Facility CUSIP Number: 00000XXX0
dated as of May 16, 2019
among
XXXXXXX RESOURCES, LLC
as Borrower,
The Financial Institutions Party Hereto, as Banks,
XXXXX FARGO BANK, N.A., as Administrative Agent, and
XXXXX FARGO SECURITIES, LLC,
as Sole Lead Arranger and Sole Bookrunner
TABLE OF CONTENTS
Page No.
ARTICLE I TERMS DEFINED 1
Section 1.1 Terms Defined Above 1
Section 1.2 Definitions. 1
Section 1.3 Accounting Terms and Determinations 33
Section 1.4 Classification of Loans and Borrowings 34
Section 1.5 Interpretation 34
Section 1.6 Rates 34
Section 1.7 Divisions 34
ARTICLE II THE CREDIT FACILITIES 34
Section 2.1 Commitments 34
Section 2.2 Method of Borrowing 39
Section 2.3 Method of Requesting Letters of Credit 40
Section 2.4 Notes 41
Section 2.5 Interest Rates; Payments; No Premiums 41
Section 2.6 Mandatory Prepayments 43
Section 2.7 Voluntary Prepayments 44
Section 2.8 | Mandatory Termination of Commitments; Termination Date and Maturity 44 |
Section 2.9 Optional Termination and Voluntary Reduction of Aggregate
Maximum Credit Amount 44
Section 2.10 Application of Payments 45
Section 2.11 Commitment Fee 45
Section 2.12 Letter of Credit Fees and Letter of Credit Fronting Fees 45
Section 2.13 Agency and Other Fees 45
Section 2.14 Reliance on Notices 45
Section 2.15 | Increases, Reductions and Terminations of Aggregate Elected Commitment Amount 46 |
ARTICLE III GENERAL PROVISIONS 48
Section 3.1 Delivery and Endorsement of Notes 48
Section 3.2 General Provisions as to Payments 49
Section 3.3 Funding Losses 50
Section 3.4 Non-Receipt of Funds by Administrative Agent 51
Section 3.5 Defaulting Banks 51
ARTICLE IV BORROWING BASE 52
Section 4.1 Reserve Reports; Proposed Borrowing Base 52
Section 4.2 | Periodic Determinations of the Borrowing Base; Procedures and Standards 52 |
Section 4.3 Special Determination of Borrowing Base 53
Section 4.4 Borrowing Base Deficiency 53
Section 4.5 Initial Borrowing Base 54
Section 4.6 Automatic Adjustment – Asset Disposition 54
Section 4.7 Automatic Adjustment – Issuance of Permitted Additional Debt 55
ARTICLE V COLLATERAL AND GUARANTIES 55
Section 5.1 Security 55
Section 5.2 Title Information 57
Section 5.3 Guarantees 57
Section 5.4 Additional Guarantors 57
ARTICLE VI CONDITIONS PRECEDENT 58
Section 6.1 Conditions to Initial Borrowing and Participation in Letter of
Credit Exposure 58
Section 6.2 Each Credit Event 62
ARTICLE VII REPRESENTATIONS AND WARRANTIES 63
Section 7.1 Existence and Power 63
Section 7.2 Corporate, Limited Liability Company, Partnership and
Governmental Authorization; Contravention 63
Section 7.3 Binding Effect 63
Section 7.4 Financial Information 63
Section 7.5 Litigation 64
Section 7.6 ERISA 64
Section 7.7 Taxes and Filing of Tax Returns 64
Section 7.8 Title to Properties; Liens 65
Section 7.9 Mineral Interests 65
Section 7.10 Business; Compliance 65
Section 7.11 Licenses, Permits, Etc 65
Section 7.12 Compliance with Law 66
Section 7.13 Solvency 66
Section 7.14 Full Disclosure 66
Section 7.15 Organizational Structure; Nature of Business 67
Section 7.16 Environmental Matters 67
Section 7.17 Burdensome Obligations 68
Section 7.18 Government Regulations 68
Section 7.19 No Default 68
Section 7.20 Gas Balancing Agreements and Advance Payment Contracts 68
Section 7.21 Anti-Corruption Laws and Sanctions. 68
Section 7.22 EEA Financial Institutions 68
ARTICLE VIII AFFIRMATIVE COVENANTS 69
Section 8.1 Information 69
Section 8.2 Business of Credit Parties 74
Section 8.3 Maintenance of Existence 74
Section 8.4 Right of Inspection; Books and Records 75
Section 8.5 Maintenance of Insurance 75
Section 8.6 Payment of Obligations 75
Section 8.7 Compliance with Laws and Documents 76
Section 8.8 Maintenance of Properties and Equipment 76
Section 8.9 Further Assurances 76
Section 8.10 Environmental Law Compliance and Indemnity 77
Section 8.11 ERISA Reporting Requirements 78
Section 8.12 Commodity Exchange Act Keepwell Provisions 78
Section 8.13 Unrestricted Subsidiaries 78
Section 8.14 Deposit Accounts; Commodity Accounts and Securities Accounts 79
Section 8.15 Post-Closing Delivery of Account Control Agreements 79
ARTICLE IX NEGATIVE COVENANTS 79
Section 9.1 Debt 79
Section 9.2 | Restricted Payments and Redemptions of Permitted Additional Debt 80 |
Section 9.3 Liens; Negative Pledge 81
Section 9.4 Consolidations and Mergers 81
Section 9.5 Asset Dispositions 81
Section 9.6 Use of Proceeds 82
Section 9.7 Investments 82
Section 9.8 Transactions with Affiliates 82
Section 9.9 ERISA 83
Section 9.10 Hedge Transactions 83
Section 9.11 Designation and Conversion of Restricted and Unrestricted
Subsidiaries 85
Section 9.12 Amendments to Permitted Additional Debt Documents 85
Section 9.13 Holding Company 85
ARTICLE X FINANCIAL COVENANTS 86
Section 10.1 Financial Covenants 86
ARTICLE XI DEFAULTS 86
Section 11.1 Events of Default 86
ARTICLE XII AGENTS 88
Section 12.1 Appointment and Authorization of Administrative Agent; Secured
Hedge Transactions 88
Section 12.2 Delegation of Duties 89
Section 12.3 Default; Collateral 89
Section 12.4 Liability of Administrative Agent 90
Section 12.5 Reliance by Administrative Agent 91
Section 12.6 Notice of Default 91
Section 12.7 | Credit Decision; Disclosure of Information by Administrative Agent 92 |
Section 12.8 Indemnification of Agents 92
Section 12.9 Administrative Agent in its Individual Capacity 93
Section 12.10 Successor Administrative Agent and Letter of Credit Issuer 93
Section 12.11 Syndication Agent; Other Agents; Arranger 94
Section 12.12 Administrative Agent May File Proof of Claim 94
Section 12.13 Secured Hedge Transactions 95
Section 12.14 Collateral and Guaranty Matters 95
ARTICLE XIII PROTECTION OF YIELD; CHANGE IN LAWS 96
Section 13.1 Basis for Determining Interest Rate Applicable to Eurodollar
Tranches Inadequate 96
Section 13.2 Illegality of Eurodollar Tranches 97
Section 13.3 Increased Cost of Eurodollar Tranche 98
Section 13.4 Adjusted Base Rate Tranche Substituted for Affected Eurodollar
Tranche 99
Section 13.5 Taxes 99
Section 13.6 Discretion of Banks as to Manner of Funding 103
Section 13.7 Mitigation Obligations; Replacement of Banks 103
ARTICLE XIV MISCELLANEOUS 105
Section 14.1 Notices; Effectiveness; Electronic Communications 105
Section 14.2 Waivers and Amendments; Acknowledgments 107
Section 14.3 Expenses; Indemnification 109
Section 14.4 Right and Sharing of Set-Offs 110
Section 14.5 Survival 111
Section 14.6 Limitation on Interest 111
Section 14.7 Invalid Provisions 112
Section 14.8 Successors and Assigns 112
Section 14.9 Applicable Law and Jurisdiction 115
Section 14.10 Counterparts; Effectiveness 115
Section 14.11 No Third Party Beneficiaries 115
Section 14.12 COMPLETE AGREEMENT 116
Section 14.13 WAIVER OF JURY TRIAL, PUNITIVE DAMAGES, ETC 116
Section 14.14 Confidential Information 116
Section 14.15 No Advisory or Fiduciary Responsibility 117
Section 14.16 USA Patriot Act Notice 118
Section 14.17 Headings 118
Section 14.18 Collateral Matters; Hedge Transactions 118
Section 14.19 EXCULPATION PROVISIONS 118
Section 14.20 Acknowledgement and Consent to Bail-In of EEA Financial Institutions. | 118 |
EXHIBITS
Exhibit A — Form of Note
Exhibit B — Form of Request for Borrowing Exhibit C — Form of Request for Letter of Credit Exhibit D — Form of Rollover Notice
Exhibit E — Form of Assignment and Assumption Agreement Exhibit F — Form of Financial Compliance Certificate Exhibit G — Form of Security Agreement
Exhibit H — Form of Facility Guaranty
Exhibit I-1 | — Form of U.S. Tax Compliance Certificate (Foreign Banks; not partnerships) |
Exhibit I-2 | — Form of U.S. Tax Compliance Certificate (Foreign Participants; not partnerships) |
Exhibit I-3 | — Form of U.S. Tax Compliance Certificate (Foreign Participants; partnerships) |
Exhibit I-4 | — Form of U.S. Tax Compliance Certificate (Foreign Banks; partnerships) |
Exhibit J — Form of Elected Commitment Increase Certificate Exhibit K — Form of Additional Bank Certificate
SCHEDULES
Schedule 1 — Banks; Elected Commitments and Maximum Credit Amount Schedule 2 — Litigation
Schedule 3 — Organizational Information and Subsidiaries
THIS CREDIT AGREEMENT is entered into effective as of May 16, 2019, among XXXXXXX RESOURCES, LLC, a Delaware limited liability company (“Borrower”), XXXXX FARGO BANK, N.A., a national banking association, as administrative agent (in such capacity, together with its successors in such capacity, “Administrative Agent”) and as Letter of Credit Issuer, and the financial institutions from time to time party hereto as Banks.
RECITALS:
WHEREAS, Borrower has requested that Banks provide certain loans to and extensions of credit on behalf of Borrower; and
WHEREAS, Banks have agreed to make such loans and extensions of credit subject to the terms and conditions of this Agreement.
NOW, THEREFORE, in consideration of the premises, the representations, warranties, covenants and agreements contained herein, and other good and valuable consideration, the receipt and adequacy of which are hereby acknowledged, Borrower, Administrative Agent and Banks hereby agree as follows:
ARTICLE I TERMS DEFINED
Section 1.1 Terms Defined Above. As used in this Agreement, each term defined above has the meaning indicated above.
Section 1.2 Definitions. The following terms, as used herein, have the following meanings:
“Account Control Agreement” means a control agreement, in form and substance reasonably satisfactory to Administrative Agent, which grants Administrative Agent “control” as defined in the Uniform Commercial Code in effect in the applicable jurisdiction over any Deposit Account, Securities Account or Commodity Account maintained by any Credit Party, in each case, among Administrative Agent, the applicable Credit Party and the applicable financial institution at which such Deposit Account, Securities Account or Commodity Account is maintained.
“Additional Bank” has the meaning given to such term in Section 2.15(a).
“Additional Bank Certificate” has the meaning given to such term in Section 2.15(b)(vii). “Adjusted Base Rate” means, on any day, the greatest of (a) the Base Rate in effect on such
day, (b) the sum of (i) the Federal Funds Rate in effect on such day, plus (ii) one half of one percent
(.5%), (c) the Adjusted LIBOR Rate for a one month Interest Period on such day (or if such day is not a Eurodollar Business Day, the immediately preceding Eurodollar Business Day) plus 1.0%, or (d) zero percent (0%), provided that, for the avoidance of doubt, the Adjusted LIBO Rate for any day shall be based on the rate as published by the ICE Benchmark Administration Limited, a United Kingdom company, or a comparable or successor quoting service approved by
Administrative Agent from time to time for purposes of providing quotations of interest rates applicable to dollar deposits in the London interbank market, at approximately 11:00 a.m., London time, on such day (or the immediately preceding Business Day if such day is not a Business Day), as the rate for dollar deposits with a one month maturity. Each change in the Adjusted Base Rate shall become effective automatically and without notice to Borrower or any Bank upon the effective date of each change in the Federal Funds Rate, the Base Rate or the Adjusted LIBOR Rate, as the case may be. If the Adjusted Base Rate is being used as an alternate rate of interest pursuant to Section 13.1 hereof, then the Adjusted Base Rate shall be the greater of clause (a) and
(b) above and shall be determined without reference to clause (c) above. For the avoidance of doubt, if the Adjusted Base Rate shall be less than zero, such rate shall be deemed to be zero for purposes of this Agreement.
“Adjusted Base Rate Borrowing” means any Borrowing which will constitute an Adjusted Base Rate Tranche.
“Adjusted Base Rate Tranche” means the portion of the principal of any Loan bearing interest with reference to the Adjusted Base Rate.
“Adjusted LIBOR Rate” applicable to any Interest Period, means the greater of (a) a rate per annum equal to the quotient obtained (rounded upwards, if necessary, to the next higher 1/100 of 1%) by dividing (i) the applicable LIBOR Rate by (ii) 1.00 minus the Eurodollar Reserve Percentage, and (b) zero percent (0%).
“Administrative Questionnaire” means an Administrative Questionnaire in a form supplied by Administrative Agent.
“Advance Payment Contract” means any contract whereby (a) any Credit Party receives or becomes entitled to receive (either directly or indirectly) any payment (an “Advance Payment”) to be applied toward payment of the purchase price of Hydrocarbons produced or to be produced from working interests in Proved Mineral Interests owned by any Credit Party and which Advance Payment is paid or to be paid in advance of actual delivery of such production to or for the account of the purchaser regardless of such production, and (b) the Advance Payment is, or is to be, applied as payment in full for such production when sold and delivered or is, or is to be, applied as payment for a portion only of the purchase price thereof or of a percentage or share of such production; provided that inclusion of the standard “take or pay” provision in any gas sales or purchase contract or any other similar contract shall not, in and of itself, constitute such contract as an Advance Payment Contract for the purposes hereof.
“Affiliate” means, as to any Person, any Subsidiary of such Person, or any other Person which, directly or indirectly, Controls, is Controlled by, or is under common Control with, such Person; provided that Borrower and its Subsidiaries shall not be considered “Affiliates” of other portfolio companies Controlled by any Sponsor.
“Agent Parties” has the meaning given to such term in Section 14.1(c).
“Agents” means, collectively, Administrative Agent and any syndication agent or documentation agent appointed hereunder from time to time; and “Agent” means any of them individually, as the context requires.
“Aggregate Elected Commitment Amount” means, at any time, an amount equal to the sum of the Elected Commitments, as the same may be increased, reduced or terminated pursuant to Section 2.15. As of the Effective Date, the Aggregate Elected Commitment Amount is
$120,000,000.
“Aggregate Maximum Credit Amount” at any time shall equal the sum of the Maximum Credit Amounts, as the same may be increased, reduced or terminated from time to time in accordance with the terms hereof. The initial Aggregate Maximum Credit Amount of the Banks on the Effective Date is $500,000,000.
“Agreement” means this Credit Agreement, including the Schedules and Exhibits hereto, and as the same may from time to time be amended, modified, supplemented or restated.
“Annualized EBITDA” means, for the purposes of calculating the financial ratio set forth in Section 10.1(b) for each Rolling Period ending on or prior to December 31, 2019, Borrower’s actual Consolidated EBITDA for such Rolling Period multiplied by the factor determined for such Rolling Period in accordance with the table below:
Rolling Period Ending | Factor |
June 30, 2019 | 4 |
September 30, 2019 | 2 |
December 31, 2019 | 4/3 |
“Anti-Corruption Laws” means all laws, rules, and regulations of any jurisdiction applicable to Borrower or its Subsidiaries from time to time concerning or relating to bribery or corruption.
“Applicable Environmental Law” means any Law of any Governmental Authority pertaining in any way to public health, the environment, the preservation or reclamation of natural resources, or the management, Hazardous Discharge or threatened Hazardous Discharge of any Hazardous Substance, in effect in any and all jurisdictions in which Borrower or any Restricted Subsidiary is conducting, or at any time has conducted, business, or where any Property of Borrower or any Restricted Subsidiary is located, including, the Oil Pollution Act of 1990 (“OPA”), as amended, the Clean Air Act, as amended, the Comprehensive Environmental, Response, Compensation, and Liability Act of 1980 (“CERCLA”), as amended, the Federal Water Pollution Control Act, as amended, the Resource Conservation and Recovery Act of 1976 (“RCRA”), as amended, the Safe Drinking Water Act, as amended, the Toxic Substances Control
Act, as amended, the Superfund Amendments and Reauthorization Act of 1986, as amended, the Hazardous Materials Transportation Act, as amended, and other environmental conservation or protection Laws.
“Applicable Margin” means, on any date, with respect to each Eurodollar Tranche or Adjusted Base Rate Tranche, an amount determined by reference to the ratio of Outstanding Revolving Credit to the Borrowing Base, on such date, in accordance with the table below:
Pricing Level | Ratio of Outstanding Revolving Credit to Borrowing Base | Applicable Margin for Eurodollar Tranches | Applicable Margin for Adjusted Base Rate Tranches | |||
I | ≥90% | 2.75% | 1.75% | |||
II | ≥75% but<90% | 2.50% | 1.50% | |||
III | ≥50% but <75% | 2.25% | 1.25% | |||
IV | ≥25% but <50% | 2.00% | 1.00% | |||
V | <25% | 1.75% | 0.75% | |||
Each change in the Applicable Margin shall apply during the period commencing on the effective date of such change and ending on the date immediately preceding the effective date of the next such change; provided that, if at any time Borrower fails to deliver a Reserve Report pursuant to Section 4.1, then the “Applicable Margin” means the rate per annum set forth on the grid when the Ratio of Outstanding Revolving Credit to the Borrowing Base is at its highest level until such Reserve Report is delivered.
“Applicable Percentage” means, with respect to any Bank at any time, the fraction, expressed as a percentage, the numerator of which is such Bank’s Maximum Credit Amount and the denominator of which is the Aggregate Maximum Credit Amount.
“Approved Counterparty” means (a) any Bank or any Affiliate of a Bank and (b) any other Person that either (i) has a long term senior unsecured debt rating of BBB+/Baa1 by S&P or Xxxxx’x (or their equivalent) or higher or (ii) is guaranteed with respect to its Hedge Agreements with Credit Parties by a credit support provider that has a long term senior unsecured debt rating of BBB+/Baa1 by S&P or Xxxxx’x (or their equivalent) or higher.
“Approved Petroleum Engineer” means (a) Xxxxxx, Xxxxxxxxx & Associates, Inc., (b)Netherland, Xxxxxx & Associates, Inc., (c) Xxxxx Xxxxx Company, L.P. and (d) any other
independent petroleum engineers as shall be selected by Borrower and reasonably acceptable to Administrative Agent.
“Arranger” means Xxxxx Fargo Securities, LLC, in its capacity as the sole lead arranger and sole bookrunner hereunder.
“Asset Disposition” means (a) the sale, assignment, lease, transfer, exchange or other disposition by any Credit Party of all or any portion of its right, title and interest in any Borrowing Base Property, (b) the sale, assignment, transfer, exchange or other disposition by any Credit Party of any Equity Interest in any Restricted Subsidiary that owns any Borrowing Base Property or the issuance by any Restricted Subsidiary that owns any Borrowing Base Property of any of its Equity Interests to any Person other than a Credit Party, or (c) the termination (other than at its scheduled maturity) or monetization by any Credit Party of any Borrowing Base Hedge.
“Assignee” has the meaning given to such term in Section 14.8(c).
“Assignment and Assumption Agreement” has the meaning given to such term in Section 14.8(c).
“Authorized Officer” means, as to any Person, its Chairman, Chief Executive Officer, Chief Financial Officer, Vice-Chairman, President, Executive Vice President(s), Senior Vice President(s) or Vice President duly authorized to act on behalf of such Person.
“Bail-In Action” means the exercise of any Write-Down and Conversion Powers by the applicable EEA Resolution Authority in respect of any liability of an EEA Financial Institution.
“Bail-In Legislation” means, with respect to any EEA Member Country implementing Article 55 of Directive 2014/59/EU of the European Parliament and of the Council of the European Union, the implementing law for such EEA Member Country from time to time which is described in the EU Bail-In Legislation Schedule.
“Bank” means (a) any financial institution listed on Schedule 1 hereto as having a Commitment and (b) any Person that shall have become a party to this Agreement as an Additional Bank pursuant to Section 2.15(b)(vii), and in each case, such Bank’s successors and permitted assigns, and “Banks” means all Banks.
“Bank Products” means any of the following bank services: (a) commercial credit cards,
(b)stored value cards, and (c) treasury management services (including controlled disbursement, automated clearinghouse transactions, return items, overdrafts and interstate depository network services).
“Bank Products Provider” means any Bank or Affiliate of a Bank that provides Bank Products to Borrower or any Guarantor.
“Base Rate” means the fluctuating rate of interest in effect for such day as publicly announced from time to time by Xxxxx Fargo Bank, N.A. as its “prime rate” in effect at its principal office (which, as of the Effective Date, is located in San Francisco, California). The “prime rate” is a rate set by Xxxxx Fargo Bank, N.A. based upon various factors including Xxxxx Fargo Bank, N.A.’s costs and desired return, general economic conditions and other factors, and is used as a reference point for pricing some loans, which may be priced at, above, or below such announced rate. Any change in such rate announced by Xxxxx Fargo Bank, N.A. shall take effect at the opening of business on the day specified in the public announcement of such change.
“Beneficial Ownership Certification” means a certification regarding beneficial ownership as required by the Beneficial Ownership Regulation.
“Beneficial Ownership Regulation” means 31 C.F.R. § 1010.230.
“Benefitting Guarantor” means a Guarantor for which funds or other support are required in order for such Guarantor to constitute an Eligible Contract Participant.
“Borrower Materials” has the meaning given to such term in Section 8.1.
“Borrowing” means Loans of the same Type, made, converted or continued on the same date and, in the case of Eurodollar Loans, as to which a single Interest Period is in effect.
“Borrowing Base” means, at any time, an amount determined in accordance with Article IV, as the same may be adjusted from time to time pursuant to Section 4.6, Section 4.7 and Section 5.2.
“Borrowing Base Deficiency” means, as of any date, the amount, if any, by which (a) the Outstanding Revolving Credit on such date, exceeds (b) the Borrowing Base in effect on such date; provided that, for purposes of computing the existence and amount of any Borrowing Base Deficiency, Letter of Credit Exposure will not be deemed to be outstanding to the extent funds have been deposited with Administrative Agent to secure such Letter of Credit Exposure pursuant to Section 2.1(b).
“Borrowing Base Hedge” means, at any time, any Oil and Gas Hedge Transaction that has been incorporated into the determination of the Borrowing Base (as determined by Administrative Agent) then in effect.
“Borrowing Base Properties” means all Proved Mineral Interests of Borrower and its Restricted Subsidiaries in the most recently delivered Reserve Report that are evaluated by Banks for purposes of establishing the Borrowing Base then in effect.
“Borrowing Date” means the Eurodollar Business Day or the Business Day, as the case may be, upon which the proceeds of any Borrowing are made available to Borrower or to satisfy the obligations of Borrower or any other Credit Party.
“Business Day” means any day except a Saturday, Sunday or other day on which national banks in New York, New York, Houston, Texas or Austin, Texas are authorized by Law to close.
“Capital Lease” means, subject to Section 1.3, for any Person as of any date, any lease of Property, which would be capitalized on a balance sheet of the lessee prepared as of such date in accordance with GAAP as in effect on the date hereof.
“Change in Law” means the occurrence, after the date of this Agreement, of any of the following: (a) the adoption or taking effect of any law, rule, regulation or treaty, (b) any change in any law, rule, regulation or treaty or in the administration, interpretation, implementation or application thereof by any Governmental Authority or (c) compliance by any Bank or the Letter of Credit Issuer (or, for purposes of Section 13.3, by any lending office of such Bank or by such Bank’s or the Letter of Credit Issuer’s holding company, if any) with the making or issuance of any request, rule, guideline or directive (whether or not having the force of law) by any Governmental Authority; provided that notwithstanding anything herein to the contrary, (x) the Xxxx-Xxxxx Xxxx Street Reform and Consumer Protection Act and all requests, rules, guidelines or directives thereunder or issued in connection therewith and (y) all requests, rules, guidelines or directives promulgated by the Bank for International Settlements, the Basel Committee on Banking Supervision (or any successor or similar authority) or the United States or foreign regulatory authorities, in each case pursuant to Basel III, shall in each case be deemed to be a “Change in Law”, regardless of the date enacted, adopted or issued.
“Change of Control” means the occurrence of any of the following whether voluntary or involuntary, including by operation of law:
(a) any “person” or “group” (as such terms are used in Sections 13(d) or 14(d) of the Exchange Act), other than the Permitted Holders (or any intermediate entities owned directly or indirectly or Controlled by the Permitted Holders), shall at any time have become the “beneficial owner” (as defined in Rules 13d-3 and 13d-5 under the Exchange Act), directly or indirectly, of the greater of (i) 35% or more of the aggregate ordinary voting power for the election of managers or directors of Parent and (ii) the percentage of the ordinary voting power for the election of managers or directors of Parent owned in the aggregate, directly or indirectly, beneficially, by the Permitted Holders;
(b) the occupation of a majority of the seats (other than vacant seats) on the board of directors of Parent by Persons who were neither (i) directors of the Parent on the Effective Date, (ii) nominated, appointed or approved for consideration by shareholders for election by (A) at least 51% of the then directors of Parent or (B) a Sponsor pursuant to the Stockholders’ Agreement or (iii) appointed by directors so nominated, appointed or approved;
(c) Parent and the Permitted Holders, collectively, shall at any time cease (i) to be the “beneficial owner” (as defined in Rules 13d-3 and 13d-5 under the Exchange Act), directly or indirectly, of more than 50% of the outstanding Equity Interests in Holdings or
(ii) to Control Holdings;
(d) Holdings shall at any time cease (i) to have beneficial ownership of 100% of the outstanding Equity Interests in Borrower, (ii) to be the sole managing member of Borrower or (iii) to Control Borrower; or
(e) any “change of control”, “change in control” or similar events occurs under any Permitted Additional Debt Documents evidencing Material Debt, and as a result thereof the maturity of such Material Debt is accelerated, the obligor on such Material Debt is obligated to offer to Redeem such Material Debt, or the obligee on such Material Debt shall otherwise have the right to require the obligor thereon to Redeem such Material Debt.
“Code” means the Internal Revenue Code of 1986, as amended (except as otherwise provided herein).
“Commitment” means, with respect to any Bank, the commitment of such Bank to make Loans and to acquire participations in Letters of Credit hereunder, as such amount may be terminated, reduced or increased from time to time in accordance with the provisions hereof. The amount representing each Bank’s Commitment shall at any time be the least of (a) such Bank’s Maximum Credit Amount, (b) such Bank’s Applicable Percentage of the then effective Borrowing Base and (c) such Bank’s Elected Commitment.
“Commitment Fee Percentage” means, on any date, the percentage determined pursuant to the table below based on the ratio of the Outstanding Revolving Credit on such date to the Borrowing Base on such date:
Pricing Level | Ratio of Outstanding Revolving Credit to Borrowing Base | Commitment Fee Percentage |
I | ≥90% | 0.500% |
II | ≥75% but <90% | 0.500% |
III | ≥50% but <75% | 0.500% |
IV | ≥25% but <50% | 0.375% |
V | <25% | 0.375% |
“Commodity Account” shall have the meaning set forth in Article 9 of the UCC.
“Commodity Exchange Act” means the Commodity Exchange Act (7 U.S.C. § 1 et seq.), as amended from time to time, and any successor statute, and any regulations promulgated thereunder.
“Consolidated Current Assets” means, at any time, the sum of (a) the current assets of Borrower and its Consolidated Restricted Subsidiaries at such time, plus (b) the Revolving Availability at such time. For purposes of this definition, any non-cash assets resulting from the
requirements of FASB ASC 815 for any period of determination shall be excluded from the determination of current assets of Borrower and its Consolidated Restricted Subsidiaries.
“Consolidated Current Liabilities” means, at any time, the current liabilities of Borrower and its Consolidated Restricted Subsidiaries at such time. For purposes of this definition, any non- cash liabilities resulting from the requirements of FASB ASC 815 for any period of determination, and any current maturities under this Agreement, shall be excluded from the determination of current liabilities of Borrower and its Consolidated Restricted Subsidiaries.
“Consolidated EBITDA” means, for any period, Consolidated Net Income for such period,
(a)plus each of the following, to the extent deducted in determining Consolidated Net Income: (i) any provision for (or less any benefit from) income or franchise Taxes; (ii) Consolidated Interest Expense; (iii) depreciation, depletion and amortization expense; (iv) actual transaction costs, expenses and charges incurred prior to the Effective Date with respect to the Initial Public Offering; (v) transaction costs, expenses and charges with respect to the execution, delivery and performance of this Agreement and the other Loan Papers; (vi) transaction costs, expenses and charges with respect to the acquisition or disposition of Mineral Interests in an aggregate amount not to exceed $500,000 in any Fiscal Year; and (vii) other non-cash charges to the extent not already included in the foregoing clauses (ii) through (vi), and (b) minus all non-cash income to the extent included in determining Consolidated Net Income. For the purposes of calculating Consolidated EBITDA for any Rolling Period for any determination of the financial ratio contained in Section 10.1(b), if at any time during such Rolling Period Borrower or any Consolidated Restricted Subsidiary shall have made any material disposition or material acquisition, the Consolidated EBITDA for such Rolling Period shall be calculated after giving pro forma effect thereto as if such material disposition or material acquisition had occurred on the first day of such Rolling Period, such pro forma adjustments to be acceptable to Administrative Agent and Borrower. As referred to in the preceding sentence, material disposition and material acquisition refer to any disposition or acquisition that involves the receipt or payment of
consideration by Borrower and its Consolidated Restricted Subsidiaries in excess of a dollar amount equal to the greater of $10,000,000 and five percent (5.0%) of the Borrowing Base.
“Consolidated Interest Expense” means, for any period, the total consolidated interest expense of Borrower and its Consolidated Restricted Subsidiaries for such period net of gross interest income of Borrower and its Consolidated Restricted Subsidiaries, in each case determined on a consolidated basis in accordance with GAAP plus (without duplication) to the extent not already included in such total consolidated interest expense:
(a) imputed interest on Debt attributable to Capital Leases and sale and leaseback transactions of Borrower or any of its Consolidated Restricted Subsidiaries for such period;
(b) commissions, discounts and other fees and charges owed by Borrower or any of its Consolidated Restricted Subsidiaries with respect to letters of credit securing financial obligations and bankers’ acceptances for such period;
(c) amortization of debt issuance costs, debt discount or premium and other financing fees and expenses; and
(d) the interest portion of any deferred payment obligations of Borrower or any of its Consolidated Restricted Subsidiaries for such period.
“Consolidated Net Income” means, for any period, the net income (or loss) of Borrower and its Consolidated Restricted Subsidiaries for such period determined in accordance with GAAP, but excluding: (a) the income of any other Person (other than any Consolidated Restricted Subsidiary of Borrower) in which a Credit Party has an ownership interest, unless received by such Credit Party in a cash distribution; (b) any gains or losses attributable to “sales of property”, as defined and reported in accordance with GAAP in Borrower’s consolidated financial statements; and (c) to the extent not included in clauses (a) and (b) above, any extraordinary gains or extraordinary losses.
“Consolidated Restricted Subsidiaries” means any Restricted Subsidiaries that are Consolidated Subsidiaries.
“Consolidated Subsidiary” or “Consolidated Subsidiaries” means, for any Person, at any time, any Subsidiary or other entity the accounts of which would be consolidated with those of such Person in its consolidated financial statements as of such time.
“Consolidated Unrestricted Subsidiaries” means any Unrestricted Subsidiaries that are Consolidated Subsidiaries.
“Control” (including with correlative meanings, the terms “controlled by” and “under common control with”), as used with respect to any Person, means the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of such Person, whether through the ownership of voting securities or partnership interests, or by contract or otherwise.
“Conversion Date” has the meaning given to such term in Section 2.5(c).
“Credit Parties” means, collectively, Borrower and each Guarantor, and “Credit Party” means any one of the foregoing.
“Current Financials” means the audited consolidated balance sheets of Borrower as of the end of the Fiscal Year ending December 31, 2018 (but solely with respect to Borrower and its Subsidiaries constituting Consolidated Subsidiaries upon giving effect to the Initial Public Offering) and the related consolidated statements of income and cash flows for such Fiscal Year, all reported on by KPMG LLP.
“Current Ratio” means, as of any date of determination, the ratio of Consolidated Current Assets to Consolidated Current Liabilities.
“Debt” of any Person means, without duplication:
(a)obligations of such Person for borrowed money or evidenced by bankers’ acceptances, debentures, notes, bonds or other similar instruments;
(b)obligations of such Person (whether contingent or otherwise) in respect of letters of credit;
(c) | obligations of such Person with respect to Disqualified Capital Stock; |
(d)obligations of such Person under Capital Leases or constituting Purchase Money Debt;
(e) | obligations of such Person to pay the deferred purchase price of Property; |
(f)Debt (as defined in the other clauses of this definition) of others secured by (or for which the holder of such Debt has an existing right, contingent or otherwise, to be secured by) a Lien on any Property of such Person, whether or not such Debt is assumed by such Person;
(g)Debt (as defined in the other clauses of this definition) of others guaranteed by such Person or in which such Person otherwise assures a creditor against loss of the Debt (howsoever such assurance shall be made, including by means of obligations to pay for goods or services even if such goods or services are not actually taken, received or utilized) to the extent of the lesser of the amount of such Debt and the maximum stated amount of such guarantee or assurance against loss; and
(h)Debt (as defined in the other clauses of this definition) of a partnership for which such Person is liable either by agreement or by operation of Law, but only to the extent of such liability;
provided, however, that “Debt” does not include (i) obligations with respect to surety or performance and similar instruments incurred in the ordinary course of business and obligations with respect to appeal bonds, (ii) trade accounts and other similar accounts that are (x) not
outstanding more than 90 days after the invoice date or (y) being contested in good faith by appropriate action and for which adequate reserves have been maintained in accordance with GAAP, or (iii) obligations in respect of Hedge Agreements.
“Default” means any condition or event which constitutes an Event of Default or which with the giving of notice or lapse of time or both would, unless cured or waived, become an Event of Default.
“Default Rate” means, with respect to the amount of any Obligation under any Loan Paper, a rate per annum during the period commencing on the due date until such amount is paid in full equal to the sum of (a) two percent (2%), plus (b) the Adjusted Base Rate plus the Applicable Margin then in effect for Adjusted Base Rate Borrowings (provided that, if such amount in default is principal of a Borrowing subject to a Eurodollar Tranche and the due date is a day other than the last day of an Interest Period therefor, the “Default Rate” for such principal shall be, for the period from and including the due date and to but excluding the last day of the Interest Period therefor, (i) two percent (2%), plus (ii) the Applicable Margin then in effect for Eurodollar Borrowings, plus (iii) the LIBOR Rate for such Borrowing for such Interest Period as provided in Section 2.5, and thereafter, the rate provided for above in this definition).
“Defaulting Bank” means any Bank that (a) has failed, within two (2) Business Days of the date required to be funded or paid, to (i) fund any portion of its Loans, (ii) fund any portion of its participations in Letters of Credit or (iii) pay over to any Credit Party any other amount required to be paid by it hereunder; (b) has notified Borrower or any other Credit Party in writing, or has made a public statement, to the effect that it does not intend or expect to comply with any of its funding obligations under this Agreement or generally under other agreements in which it commits to extend credit; (c) has failed, within three (3) Business Days after request by Administrative Agent or a Credit Party, acting in good faith, to provide a certification in writing from an authorized officer of such Bank that it will comply with its obligations to fund prospective Loans and participations in then outstanding Letters of Credit under this Agreement; provided that such Bank shall cease to be a Defaulting Bank pursuant to this clause (c) upon such Credit Party’s receipt of such certification in form and substance satisfactory to it and Administrative Agent; or (d) has (or whose bank holding company has) (i) become the subject of a Bail-In Action or (ii) been placed into receivership, conservatorship or bankruptcy; provided that a Bank shall not become a Defaulting Bank solely as a result of the acquisition or maintenance of an ownership interest in such Bank or Person controlling such Bank or the exercise of control (other than through the appointment of a conservator or receiver) over a Bank or Person controlling such Bank by a Governmental Authority or an instrumentality thereof, so long as such ownership interest does not result in or provide such Bank with immunity from the jurisdiction of courts within the United States or from the enforcement of judgments or writs of attachment on its assets or permit such Bank (or such Governmental Authority) to reject, repudiate, disavow or disaffirm any contracts or agreements made with such Bank.
“De Minimis Accounts” shall have the meaning assigned to such term in the Security Agreement.
“Deposit Account” shall have the meaning set forth in Article 9 of the UCC.
“Determination” means any Periodic Determination or Special Determination.
“Determination Date” means (a)(i) August 1, 2019, November 1, 2019 and February 1, 2020 and (ii) each May 1 and November 1 thereafter, commencing May 1, 2020 and (b) with respect to any Special Determination, the first day of the first month which is not less than 30 days following the date of a request for a Special Determination.
“Disqualified Capital Stock” means any Equity Interest that, by its terms (or by the terms of any security into which it is convertible or for which it is exchangeable) or upon the happening of any event, matures or is mandatorily redeemable for any consideration other than other Equity Interests (which would not constitute Disqualified Capital Stock), pursuant to a sinking fund obligation or otherwise, or is convertible or exchangeable for Debt or redeemable for any consideration other than other Equity Interests (which would not constitute Disqualified Capital Stock) at the option of the holder thereof, in whole or in part, on or prior to the date that is one year after the earlier of (a) the Maturity Date and (b) the date on which there are no Loans, Letter of Credit Exposure or other obligations hereunder outstanding and all of the Commitments are terminated.
“dollars” or “$” refers to lawful money of the United States of America.
“Domestic Lending Office” means, as to each Bank, its office identified in such Bank’s Administrative Questionnaire as its Domestic Lending Office or such other office as such Bank may hereafter designate as its Domestic Lending Office by notice to Borrower and Administrative Agent.
“Domestic Subsidiary” means any Restricted Subsidiary that is organized under the laws of the United States of America or any state thereof or the District of Columbia.
“EEA Financial Institution” means (a) any institution established in any EEA Member Country which is subject to the supervision of an EEA Resolution Authority, (b) any entity established in an EEA Member Country which is a parent of an institution described in clause (a) of this definition, or (c) any institution established in an EEA Member Country which is a subsidiary of an institution described in clauses (a) or (b) of this definition and is subject to consolidated supervision with its parent.
“EEA Member Country” means any of the member states of the European Union, Iceland, Liechtenstein, and Norway.
“EEA Resolution Authority” means any public administrative authority or any Person entrusted with public administrative authority of any EEA Member Country (including any delegee) having responsibility for the resolution of any EEA Financial Institution.
“Effective Date” means the date on which the conditions specified in Section 6.1 are satisfied (or waived in accordance with Section 14.2).
“Elected Commitment” means, as to each Bank, the amount set forth opposite such Bank’s name on Schedule 1 under the caption “Elected Commitment”, as the same may be increased,
reduced or terminated from time to time in connection with an optional increase, reduction or termination of the Aggregate Elected Commitment Amounts pursuant to Section 2.15.
“Elected Commitment Increase Certificate” has the meaning given to such term in Section 2.15(b)(vi).
“Election Notice” has the meaning given to such term in Section 4.4.
“Eligible Contract Participant” means an “eligible contract participant” as defined in the Commodity Exchange Act and the regulations thereunder.
“Environmental Complaint” means any complaint, summons, citation, notice, directive, order, claim, litigation, investigation, proceeding, judgment, letter or other communication from any federal, state or municipal authority or any other party against any Credit Party involving (a) a Hazardous Discharge from, onto or about any Property owned, leased or operated at any time by any Credit Party, (b) a Hazardous Discharge caused, in whole or in part, by any Credit Party or by any Person acting on behalf of or at the instruction of any Credit Party, or (c) any violation of any Applicable Environmental Law by any Credit Party.
“Equity Interests” in any Person means shares of capital stock issued by such Person, or any partnership, profits, capital or membership interests in such Person, or options, warrants or any other right to acquire the capital stock or a partnership, profits, capital or membership interest in such Person.
“ERISA” means the Employee Retirement Income Security Act of 1974, as amended, and any successor statute.
“ERISA Affiliate” means each trade or business (whether or not incorporated) which together with Borrower or any other Credit Party would be deemed to be a “single employer” within the meaning of section 4001(b)(1) of ERISA or subsections (b), (c), (m) or (o) of section 414 of the Code.
“EU Bail-In Legislation Schedule” means the EU Bail-In Legislation Schedule published by the Loan Market Association (or any successor Person), as in effect from time to time.
“Eurodollar Borrowing” means any Borrowing which will constitute a Eurodollar Tranche. “Eurodollar Business Day” means any Business Day on which commercial banks are open
for international business (including dealings in dollar deposits) in London.
“Eurodollar Lending Office” means, as to each Bank, its office, branch or Affiliate located at its address identified in such Bank’s Administrative Questionnaire as its Eurodollar Lending Office or such other office, branch or Affiliate of such Bank as it may hereafter designate as its Eurodollar Lending Office by notice to Borrower and Administrative Agent.
“Eurodollar Reserve Percentage” means for any day that percentage (expressed as a decimal) which is in effect on such day, as prescribed by the Board of Governors of the Federal Reserve System (or any successor) for determining the maximum reserve requirement for a
member bank of the Federal Reserve System in New York, New York in respect of “Eurocurrency Liabilities” (or in respect of any other category of liabilities which includes deposits by reference to which the interest rate on Eurodollar Tranches is determined or any category of extensions of credit or other assets which includes loans by a non-United States office of any Bank to United States residents). The Adjusted LIBOR Rate shall be adjusted automatically on and as of the effective date of any change in the Eurodollar Reserve Percentage.
“Eurodollar Tranche” means, with respect to any Interest Period, any portion of the principal amount outstanding under the Loans which bears interest at a rate computed by reference to the Adjusted LIBOR Rate for such Interest Period.
“Event of Default” has the meaning given to such term in Section 11.1.
“Exchange Act” means the Securities Exchange Act of 1934, as amended, and the rules and regulations promulgated thereunder.
“Excluded Swap Obligation” means, with respect to any Credit Party individually determined on a Credit Party by Credit Party basis, any Obligations or other obligation in respect of any Hedge Transaction if, and solely to the extent that, all or a portion of the guarantee of such Credit Party of, or the grant by such Credit Party of a security interest or other Lien to secure, such Obligations or other obligation in respect of such Hedge Transaction (or any guarantee thereof) is or becomes illegal under the Commodity Exchange Act or any rule, regulation or order of the Commodity Futures Trading Commission (or the application or official interpretation of any thereof) by virtue of such Credit Party’s failure for any reason to constitute an Eligible Contract Participant at the time such guarantee or grant of a security interest or other Lien is entered into or otherwise becomes effective with respect to, or any other time such Credit Party is by virtue of such guarantee or grant of security interest or other Lien otherwise deemed to enter into, such Obligations or other obligation in respect of such Hedge Transaction (or guarantee thereof). If such an obligation arises under a master agreement governing more than one swap, such exclusion shall apply only to the portion of such obligation that is attributable to swaps the guarantee or grant of security interest or other Lien for which (or for any guarantee of which) so is or becomes illegal.
“Excluded Taxes” means any of the following Taxes imposed on or with respect to a Recipient or required to be withheld or deducted from a payment to a Recipient, (a) Taxes imposed on or measured by net income (however denominated), franchise Taxes, and branch profits Taxes, in each case, (i) imposed as a result of such Recipient being organized under the laws of, or having its principal office or, in the case of any Bank, its applicable Lending Office located in, the jurisdiction imposing such Tax (or any political subdivision thereof) or (ii) that are Other Connection Taxes, (b) in the case of a Bank, U.S. federal withholding Taxes imposed on amounts payable to or for the account of such Bank with respect to an applicable interest in a Loan or Commitment pursuant to a law in effect on the date on which (i) such Bank acquires such interest in the Loan or Commitment (other than pursuant to an assignment request by Borrower under Section 13.7) or (ii) such Bank changes its Lending Office, except in each case to the extent that, pursuant to Section 13.5, amounts with respect to such Taxes were payable either to such Bank’s assignor immediately before such Bank became a party hereto or to such Bank immediately before it changed its Lending Office, (c)
Taxes attributable to such Recipient’s failure or inability to comply with Section 13.5(g) and (d) any U.S. federal withholding Taxes imposed under FATCA.
“Exhibit” refers to an exhibit attached to this Agreement and incorporated herein by reference, unless specifically provided otherwise.
“Facility Guaranty” means an agreement substantially in the form of Exhibit H attached hereto executed by each existing and future Restricted Subsidiary of Borrower in favor of Administrative Agent for the benefit of itself and the other Secured Parties, pursuant to which each such Restricted Subsidiary guarantees payment and performance in full of the Obligations, and each joinder or supplement thereto now or hereafter executed.
“FATCA” means Sections 1471 through 1474 of the Code, as of the date of this Agreement (or any amended or successor version that is substantively comparable and not materially more onerous to comply with), any current or future regulations or official interpretations thereof and any agreements entered into pursuant to Section 1471(b)(1) of the Code, any intergovernmental agreement entered into in connection with the implementation of such Sections of the Code and any fiscal or regulatory legislation, rules or practices adopted pursuant to such intergovernmental agreement, treaty or convention among Governmental Authorities and implementing such Sections of the Code.
“Federal Funds Rate” means, for any day, the rate per annum equal to the weighted average of the rates on overnight federal funds transactions with members of the Federal Reserve System arranged by federal funds brokers on such day, as published by the Federal Reserve Bank of New York on the Business Day next succeeding such day; provided that (a) if such day is not a Business Day, the Federal Funds Rate for such day shall be such rate on such transactions on the next preceding Business Day as so published on the next succeeding Business Day, and (b) if no such rate is so published on such next succeeding Business Day, the Federal Funds Rate for such day shall be the average rate (rounded upward, if necessary, to a whole multiple of 1/100 of 1%) charged to Administrative Agent on such day on such transactions as determined by Administrative Agent.
“Fee Letters” means (a) that certain letter agreement styled “Engagement Letter” dated as of January 22, 2019, among the Arranger, Administrative Agent and Borrower, as the same may be amended, restated, supplemented or otherwise modified from time to time and (b) any other letter agreements entered into from time to time between Borrower, Administrative Agent and the Arranger providing for the payments of fees to Administrative Agent and/or the Arranger in connection with this Agreement or any transaction contemplated hereby.
“Fiscal Quarter” means a three-month period ending March 31, June 30, September 30 or December 31 of a Fiscal Year.
“Fiscal Year” means a twelve-month period ending December 31.
“Flood Insurance Regulations” means (a) the National Flood Insurance Act of 1968 as now or hereafter in effect or any successor statute thereto, (b) the Flood Disaster Protection Act of 1973 as now or hereafter in effect or any successor statute thereto, (c) the National Flood Insurance Reform Act of 1994 (amending 42 USC § 4001, et seq.), as the same may be amended or recodified from time to time, and (d) the Flood Insurance Reform Act of 2004 and any regulations promulgated thereunder.
“Foreign Bank” means a Bank that is not a U.S. Person.
“Foreign Subsidiary” means any Restricted Subsidiary that is not a Domestic Subsidiary. “GAAP” means generally accepted accounting principles in the United States of America
as in effect from time to time subject to the terms and conditions set forth in Section 1.3.
“Gas Balancing Agreement” means any agreement or arrangement whereby any Credit Party, or any other party having an interest in any Hydrocarbons to be produced from Mineral Interests in which any Credit Party owns an interest, has a right to take more than its proportionate share of production therefrom as a result of previous overproduction by such Credit Party or its predecessor in interest.
“Governmental Authority” means any court or governmental department, commission, board, bureau, agency or instrumentality of any nation or of any province, state, commonwealth, nation, territory, possession, county, parish or municipality, whether now or hereafter constituted or existing (including any central bank or any supra-national body exercising such powers or functions, such as the European Union or the European Central Bank).
“Guarantee” by any Person means any obligation, contingent or otherwise, of such Person directly or indirectly guaranteeing any Debt of any other Person and, without limiting the generality of the foregoing, any obligation, direct or indirect, contingent or otherwise, of such Person (a) to purchase or pay (or advance or supply funds for the purchase or payment of) such Debt (whether arising by virtue of partnership arrangements, by agreement to keep-well, to purchase assets, goods, securities or services, to take-or-pay, or to maintain financial statement conditions, by “comfort letter” or other similar undertaking of support or otherwise) or (b) entered into for the purpose of assuring in any other manner the obligee of such Debt of the payment thereof or to protect such obligee against loss in respect thereof (in whole or in part), provided that the term Guarantee shall not include endorsements for collection or deposit in the ordinary course of business.
“Guarantor” means each existing and future Domestic Subsidiary, if any, that guarantees the Obligations pursuant to Section 5.3 or Section 5.4, as applicable.
“Hazardous Discharge” means any releasing, spilling, leaking, pumping, pouring, emitting, emptying, discharging, injecting, escaping, leaching, disposing or dumping of any Hazardous Substance from or onto any real property owned, leased or operated at any time by any Credit Party or any real property owned, leased or operated by any other party.
“Hazardous Substance” means any substance regulated or as to which liability might arise under any Applicable Environmental Law including: (a) any chemical, compound, material, product, byproduct, substance or waste defined as or included in the definition or meaning of “hazardous substance,” “hazardous material,” “hazardous waste,” “solid waste,” “toxic waste,” “extremely hazardous substance,” “toxic substance,” “contaminant,” “pollutant,” or words of similar meaning or import found in any Applicable Environmental Law; (b) Hydrocarbons, petroleum products, petroleum substances, natural gas, oil, oil and gas waste, crude oil, and any
components, fractions, or derivatives thereof; and (c) radioactive materials, explosives, asbestos or asbestos containing materials, polychlorinated biphenyls, radon, infectious or medical wastes.
“Hedge Agreement” means, collectively, any agreement, instrument, arrangement or schedule or supplement thereto evidencing any Hedge Transaction.
“Hedge Transaction” means any commodity, interest rate, currency or other swap, option, collar, futures contract or other derivative contract pursuant to which a Person xxxxxx risks or costs related to commodity prices, interest rates, currency exchange rates, securities prices or financial market conditions (including any agreement, contract or transaction that constitutes a “swap” within the meaning of section 1a(47) of the Commodity Exchange Act; provided that, except for the purposes of the definitions of “Benefitting Guarantor”, “Excluded Swap Obligation” and “Qualified ECP Guarantor”, “Hedge Transactions” shall refer to the underlying agreement and not include any separate guaranty or separate document granting a security interest or other Lien in respect of the obligations under such underlying agreement). Hedge Transactions expressly include Oil and Gas Hedge Transactions.
“Hydrocarbons” means oil, gas, casinghead gas, drip gasoline, natural gasoline, condensate, distillate, and all other liquid and gaseous hydrocarbons produced or to be produced in conjunction therewith, and all products, by-products and all other substances derived therefrom or the processing thereof, and all other minerals and substances produced in conjunction with such substances, including sulphur, geothermal steam, water, carbon dioxide, helium, and any other minerals, ores, or substances of value, and the products thereof.
“Indemnified Entity” has the meaning given to such term in Section 14.3(b). “Indemnified Taxes” means (a) Taxes, other than Excluded Taxes, imposed on or with
respect to any payment made by or on account of any obligation of any Credit Party under any Loan Paper and (b) to the extent not otherwise described in clause (a), Other Taxes.
“Initial Borrowing Base” means a Borrowing Base in the amount of $120,000,000, which shall be in effect during the period commencing on the Effective Date and continuing until the first Determination or other adjustment to the Borrowing Base hereunder after the Effective Date.
“Initial Public Offering” has the meaning given to such term in Section 6.1(b).
“Initial Reserve Report” means the Reserve Report audited by Xxxxxx, Xxxxxxxxx & Associates, Inc. dated as of December 31, 2018, with respect to the Proved Mineral Interests owned by Borrower and its Restricted Subsidiaries and utilized by Administrative Agent and Banks in determining the Initial Borrowing Base hereunder.
“Interest Option” has the meaning given to such term in Section 2.5(c).
“Interest Period” means, with respect to each Eurodollar Tranche, the period commencing on the Borrowing Date or Conversion Date applicable to such Tranche and ending one, two, three, six, or, if available to all Banks, twelve months thereafter, as Borrower may elect in the applicable
Request for Borrowing; provided that: (a) any Interest Period which would otherwise end on a day which is not a Eurodollar Business Day shall be extended to the next succeeding Eurodollar
Business Day unless such Eurodollar Business Day falls in another calendar month, in which case such Interest Period shall end on the next preceding Eurodollar Business Day; (b) any Interest Period which begins on the last Eurodollar Business Day of a calendar month (or on a day for which there is no numerically corresponding day in the calendar month at the end of such Interest Period) shall, subject to clause (c) below, end on the last Eurodollar Business Day of a calendar month; and (c) no Interest Period with respect to any Eurodollar Tranche shall extend past the Termination Date.
“Investment” means, with respect to any Person, any loan, advance, extension of credit, capital contribution to, investment in or purchase of the stock securities of, or interests in, any other Person; provided that, “Investment” shall not include current customer and trade accounts which are payable in accordance with customary trade terms or negotiable instruments in the course of collection. “Invested” has a meaning correlative thereto.
“ISP” means, with respect to any Letter of Credit, the “International Standby Practices 1998” published by the Institute of International Banking Law & Practice, Inc. (or such later version thereof as may be in effect at the time of issuance).
“Holdings” means Xxxxxxx Minerals Holdings, LLC, a Delaware limited liability company.
“Laws” means all applicable statutes, laws, codes, ordinances, regulations, orders, writs, injunctions, decrees, determinations, rules, judgments, franchises, permits, certificates, licenses, rules of common law, authorizations, or other directive or requirement, whether now or hereinafter in effect, of any state, commonwealth, nation, territory, possession, county, township, parish, municipality or Governmental Authority.
“Lending Office” means, as to any Bank, its Domestic Lending Office or its Eurodollar Lending Office, as the context may require.
“Letter of Credit Application” has the meaning given to such term in Section 2.1(b). “Letter of Credit Exposure” of any Bank means, collectively, such Bank’s aggregate
participation in (a) the unfunded portion of Letters of Credit outstanding at any time, and (b) the
funded but unreimbursed (by Borrower) portion of Letters of Credit outstanding at such time. For all purposes of this Agreement, if on any date of determination a Letter of Credit has expired by its terms but any amount may still be drawn thereunder by reason of the operation of Rule 3.14 of the ISP, such Letter of Credit shall be deemed to be “outstanding” in the amount so remaining available to be drawn.
“Letter of Credit Fee” means, for any date, with respect to any Letter of Credit issued hereunder, a fee in an amount equal to a percentage of the average daily aggregate amount of Letter of Credit Exposure of all Banks during the Fiscal Quarter (or portion thereof) ending on the date such payment is due (calculated on a per annum basis based on such average daily aggregate Letter of Credit Exposure) determined by reference to the ratio of Outstanding Revolving Credit to the Borrowing Base on such date, in accordance with the table below:
Pricing Level | Ratio of Outstanding Revolving Credit to Borrowing Base | Per Annum Letter of Credit Fee | ||
I | ≥90% | 2.75% | ||
II | ≥75% but <90% | 2.50% | ||
III | ≥50% but <75% | 2.25% | ||
IV | ≥25% but <50% | 2.00% | ||
V | <25% | 1.75% | ||
Such fee shall be payable in accordance with the terms of Section 2.12.
“Letter of Credit Fronting Fee” means, with respect to any Letter of Credit issued hereunder, a fee equal to the greater of (a) $500 or (b) 0.125% per annum of the average daily amount available to be drawn under such Letter of Credit during the Fiscal Quarter (or portion thereof) ending on the date the payment of such fee is due.
“Letter of Credit Issuer” means Xxxxx Fargo Bank, N.A., in its capacity as the issuer of Letters of Credit hereunder, and its successors in such capacity. The Letter of Credit Issuer may, in its discretion, arrange for one or more Letters of Credit to be issued by Affiliates of the Letter of Credit Issuer, in which case the term “Letter of Credit Issuer” shall include any such Affiliate with respect to Letters of Credit issued by such Affiliate.
“Letter of Credit Period” means the period commencing on the Effective Date and ending five (5) Business Days prior to the Termination Date.
“Letters of Credit” means, collectively, standby letters of credit issued for the account of Borrower pursuant to Section 2.1(b), in each case as extended or otherwise modified by the applicable Letter of Credit Issuer from time to time.
“LIBOR Rate” means, subject to the implementation of a Replacement Rate in accordance with Section 13.1(b), with respect to any Eurodollar Borrowing for any Interest Period, the rate as published by ICE Benchmark Administration Limited, a United Kingdom company, or a comparable or successor quoting service approved by Administrative Agent for purposes of providing quotations of interest rates applicable to dollar deposits in the London interbank market, at approximately 11:00 a.m., London time, two Eurodollar Business Days prior to the commencement of such Interest Period, as the rate for dollar deposits with a maturity comparable to such Interest Period. In the event that such rate is not so published, then the “LIBOR Rate” with respect to such Eurodollar Borrowing for such Interest Period shall be the rate (rounded upwards, if necessary, to the next 1/100 of 1%) at which dollar deposits of an amount comparable to such Eurodollar Borrowing and for a maturity comparable to such Interest Period are offered by the principal London office of Administrative Agent (or any Affiliate of Administrative Agent) in immediately available funds in the London interbank market at approximately 11:00 a.m., London time, two Eurodollar Business Days prior to the commencement of such Interest Period. Notwithstanding the above, (a) unless otherwise specified in any amendment to this Agreement entered into in accordance with Section 13.1(b), in the event that a Replacement Rate with respect to the LIBOR Rate is implemented then all references herein to the LIBOR Rate shall be deemed references to such Replacement Rate and
(b) if the LIBOR Rate or any Replacement Rate shall be less than zero at any time, such rate shall be deemed to be zero for purposes of this Agreement.
“Lien” means with respect to any asset, any mortgage, lien, pledge, charge, security interest or similar encumbrance of any kind in respect of such asset. For purposes of this Agreement, a Credit Party shall be deemed to own subject to a Lien any asset which is acquired or held subject to the interest of a vendor or lessor under any conditional sale agreement, Capital Lease or other title retention agreement relating to such asset.
“Loan” means each loan made by a Bank to Borrower pursuant to this Agreement, and “Loans” means all loans made by Banks to Borrower pursuant to this Agreement in an aggregate amount not to exceed the amount of the Total Commitment then in effect.
“Loan Papers” means this Agreement, the Notes, the Facility Guaranty, the Mortgages, the Security Agreement, the other Security Instruments, each Letter of Credit now or hereafter executed and/or delivered, each Fee Letter (excluding any term sheets attached thereto), and all other certificates, agreements or instruments delivered in connection with this Agreement by any Credit Party (or any officer thereof), as the foregoing may be amended from time to time. Hedge Agreements do not constitute Loan Papers.
“Majority Banks” means (a) as long as the Commitments are in effect, Banks having an aggregate Applicable Percentage of more than 50% of the Aggregate Maximum Credit Amount, and (b) following termination or expiration of the Commitments, Banks holding more than 50% of the Outstanding Revolving Credit, subject in each case to Section 3.5(a); provided that, in each case, in the event there are only two or three Banks, Majority Banks means at least two Banks.
“Margin Regulations” mean Regulations T, U and X of the Board of Governors of the Federal Reserve System, as in effect from time to time.
“Margin Stock” means “margin stock” as defined in Regulation U.
“Material Adverse Change” means any circumstance or event that has caused a Material Adverse Effect.
“Material Adverse Effect” means a material adverse effect on (a) the business, assets, liabilities, financial condition, or results of operations of the Credit Parties, taken as a whole, (b) the right or ability of any Credit Party to fully, completely and timely perform its obligations under the Loan Papers, (c) the validity or enforceability of any Loan Papers against any Credit Party (to the extent a party thereto), or (d) the validity, perfection or priority of any Lien on a material portion of the assets intended to be created under or pursuant to any Loan Paper to secure the Obligations.
“Material Agreement” means any material written or enforceable oral agreement, contract, commitment, or understanding to which a Person is a party, by which such Person is directly or indirectly bound, or to which any assets of such Person may be subject.
“Material Debt” means Debt (other than the Obligations) of Borrower or any other Credit Party with a principal amount in excess of the Threshold Amount.
“Material Gas Imbalance” means, with respect to all Gas Balancing Agreements to which any Credit Party is a party or by which any working interest in Proved Mineral Interests owned by
any Credit Party is bound, aggregate net gas imbalances representing liabilities of the Credit Parties, taken as a whole, in excess of the Threshold Amount. Gas imbalances will be determined based on written agreements, if any, specifying the method of calculation thereof, or, alternatively, if no such agreements are in existence, gas imbalances will be calculated by multiplying (x) the volume of gas imbalance as of the date of calculation (expressed in thousand cubic feet) by (y) the heating value in Btu’s per thousand cubic feet, times the Xxxxx Hub average daily spot price for the month immediately preceding the date of calculation.
“Maturity Date” means May 16, 2024.
“Maximum Credit Amount” means, as to any Bank, the amount set forth opposite such Bank’s name on Schedule 1 under the caption “Maximum Credit Amount”, as such amount may be terminated, reduced or increased from time to time in accordance with the provisions hereof.
“Maximum Lawful Rate” means, for each Bank, the maximum rate (or, if the context so permits or requires, an amount calculated at such rate) of interest which, at the time in question would not cause the interest charged on the portion of the Loans owed to such Bank at such time to exceed the maximum amount which such Bank would be allowed to contract for, charge, take, reserve, or receive under applicable Law after taking into account, to the extent required by applicable Law, any and all relevant payments or charges under the Loan Papers.
“Mineral Interests” means rights, estates, titles, and interests in and to oil and gas leases, oil and gas mineral leases, oil and gas royalty interests and overriding royalty interests, oil and gas production payments and net profits interests, oil and gas fee interests, and other real property rights in and to oil and gas reserves, including any reversionary or carried interests relating to the foregoing and any rights, titles, and interests created by or arising under the terms of any unitization, communitization, and pooling agreements or arrangements relating to the foregoing, whether arising by contract, by order, or by operation of Law.
“Moody’s” means Xxxxx’x Investors Service, Inc. and any successor thereto that is a nationally recognized rating agency.
“Mortgaged Property” means any Property owned by Borrower or any Guarantor which is subject to the Liens existing and to exist under the terms of the Security Instruments.
“Mortgages” means all mortgages, deeds of trust and similar instruments (and all amendments thereto and amendments and restatements thereof) creating, evidencing, or otherwise establishing the Liens on Mineral Interests that are required by Article V as may have been heretofore or may hereafter be granted or assigned to Administrative Agent to secure payment of the Obligations or any part thereof, all as amended, supplemented, or otherwise modified from time to time. All Mortgages shall be in form and substance reasonably satisfactory to Administrative Agent.
“Net Cash Proceeds” means the remainder of (a) the gross cash proceeds received by any Credit Party from any Asset Disposition (including any associated Hedge Transaction termination receipts) less (b) underwriter discounts and commissions, investment banking fees, legal, accounting and other professional fees and expenses, Taxes paid or payable as a result thereof
(including any Permitted Tax Distributions), and other usual and customary transaction costs, including associated Hedge Transaction termination payments, in each case only to the extent paid or payable by a Credit Party in cash and related to such Asset Disposition.
“Non-Consenting Bank” means any Bank that does not approve (a) any consent, waiver or amendment that (i) requires the approval of all Banks or all affected Banks in accordance with the terms of Section 14.2 (other than a proposed Borrowing Base that would increase the then-current Borrowing Base) and (ii) has been approved by the Required Banks or (b) a proposed Borrowing Base pursuant to Section 4.2 or Section 4.3, as applicable, that would increase the then-current Borrowing Base that has been approved by the Super Majority Banks.
“Note” means a promissory note of Borrower, payable to a Bank, in substantially the form of Exhibit A hereto, evidencing the obligation of Borrower to repay to such Bank its Applicable Percentage of the Loans, together with all modifications, extensions, renewals and rearrangements thereof, and “Notes” means all of the Notes.
“Obligations” means, collectively, all present and future indebtedness, obligations and liabilities, and all renewals and extensions thereof, or any part thereof, of each Credit Party (a) to any Bank or to any Affiliate of any Bank arising pursuant to the Loan Papers, and all interest accrued thereon and costs, expenses and reasonable attorneys’ fees incurred in the enforcement or collection thereof (including any interest that accrues after the commencement of any case, proceeding or other action relating to the bankruptcy, insolvency or reorganization of any Credit Party (or could accrue but for the operation of applicable bankruptcy or insolvency laws), whether or not such interest is allowed or allowable as a claim in any such case, proceeding or other action),
(b)to any Bank Products Provider in respect of Bank Products, and (c) arising under or in connection with any Hedge Transaction entered into on or after the date of this Agreement between any Credit Party and any counterparty that is or was, at the time such Hedge Transaction was entered into, a Bank or an Affiliate of a Bank, in the case of this clause (c) regardless of whether such counterparty ceases to be a Bank or an Affiliate of a Bank and excluding any additional transactions or confirmations entered into after such counterparty ceases to be a Bank or an Affiliate of a Bank, or after assignment by such counterparty to another counterparty that is not a Bank or an Affiliate of a Bank, regardless in the case of the foregoing clauses (a), (b) and (c) of whether such indebtedness, obligations and liabilities are direct, indirect, fixed, contingent, liquidated, unliquidated, joint, several or joint and several; provided that solely with respect to any Guarantor that is not an Eligible Contract Participant, any Excluded Swap Obligations of such Guarantor shall in any event be excluded from the “Obligations” owing by such Guarantor.
“Oil and Gas Hedge Transactions” means a Hedge Transaction pursuant to which any Person xxxxxx the price to be received by it for future production of Hydrocarbons; provided, that for the sole purpose of Section 9.10, the term “Oil and Gas Hedge Transactions” shall be deemed to exclude all purchased put options or price floors for Hydrocarbons.
“Other Connection Taxes” means, with respect to any Recipient, Taxes imposed as a result of a present or former connection between such Recipient and the jurisdiction imposing such Tax (other than connections arising from such Recipient having executed, delivered, become a party to, performed its obligations under, received payments under, received or perfected a security
interest under, engaged in any other transaction pursuant to or enforced any Loan Paper, or sold or assigned an interest in any Loan or Loan Paper).
“Other Taxes” means all present or future stamp, court or documentary, intangible, recording, filing or similar Taxes that arise from any payment made under, from the execution, delivery, performance, enforcement or registration of, from the receipt or perfection of a security interest under, or otherwise with respect to, any Loan Paper, except any such Taxes that are Other Connection Taxes imposed with respect to an assignment (other than an assignment made pursuant to Section 13.7).
“Outstanding Revolving Credit” means, at any time, the sum of (i) the aggregate Letter of Credit Exposure on such date, including the aggregate Letter of Credit Exposure related to Letters of Credit to be issued on such date, plus (ii) the aggregate outstanding principal balance of the Loans on such date, including the amount of any Borrowing to be made on such date.
“Owl Rock Credit Agreement” means that certain First Lien Credit Agreement dated as of July 27, 2018, among Borrower, as holdings, Xxxxxxx Minerals, LLC, as borrower, Owl Rock Capital Corporation, as administrative agent and collateral agent, and the lenders from time to time party thereto, as amended, restated, supplemented or otherwise modified from time to time.
“Owl Rock Payoff” has the meaning given to such term in Section 6.1(a)(xiii). “Parent” means Xxxxxxx Minerals, Inc., a Delaware corporation.
“Parent Audit Conditions” has the meaning given to such term in Section 8.1(a). “Participant” has the meaning given to such term in Section 14.8(b). “Participant Register” has the meaning given to such term in Section 14.8(b). “Payor” has the meaning given to such term in Section 3.4.
“Periodic Determination” means any determination of the Borrowing Base pursuant to Section 4.2.
“Permitted Additional Debt” means any unsecured senior or unsecured senior subordinated Debt for borrowed money of Borrower or any Credit Party incurred or issued under Section 9.1(e).
“Permitted Additional Debt Documents” means any indenture or other loan agreement governing any Permitted Additional Debt, all guarantees thereof and all other agreements, documents or instruments executed and delivered by Borrower or any other Credit Party in connection with, or pursuant to, the incurrence or issuance of Permitted Additional Debt.
“Permitted Encumbrances” means with respect to any Property:
(a) | Liens securing the Obligations under the Loan Papers; |
(b) Liens for Taxes, assessments or other governmental charges or levies which are not delinquent or which are being contested in good faith by appropriate action and for which adequate reserves have been maintained in accordance with GAAP;
(c) Liens in connection with workers’ compensation, unemployment insurance or other social security, old age pension or public liability obligations which are not delinquent or which are being contested in good faith by appropriate action and for which adequate reserves have been maintained in accordance with GAAP;
(d) landlords’, operators’, vendors’, carriers’, warehousemen’s, repairmen’s, mechanics’, suppliers’, workers’, materialmen’s, construction or other like Liens arising in the ordinary course of business or incident to the acquisition, exploration, development, ownership, maintenance and selling, leasing or otherwise disposing of, Mineral Interests, each of which is in respect of obligations that are not delinquent or which are being contested in good faith by appropriate action and for which adequate reserves have been maintained in accordance with GAAP;
(e) Liens which arise in the ordinary course of business under operating agreements, joint venture agreements, oil and gas partnership agreements, oil and gas leases, farm-out agreements, division orders, contracts for the sale, transportation or exchange of oil and natural gas, unitization and pooling declarations and agreements, area of mutual interest agreements, overriding royalty agreements, marketing agreements, processing agreements, net profits agreements, development agreements, gas balancing or deferred production agreements, injection, repressuring and recycling agreements, salt water or other disposal agreements, seismic or other geophysical permits or agreements, and other agreements which are usual and customary in the oil and gas business and are for claims which are not delinquent or which are being contested in good faith by appropriate action and for which adequate reserves have been maintained in accordance with GAAP, provided that any such Lien referred to in this clause does not materially impair the use of any material Property covered by such Lien for the purposes for which such Property is held by Borrower or any Restricted Subsidiary or materially impair the value of any material Property subject thereto;
(f) banker’s liens, rights of set-off or similar rights and remedies arising in the ordinary course of business and burdening only deposit accounts or other funds maintained with a creditor depository institution, provided that no such deposit account is a dedicated cash collateral account;
(g) easements, restrictions, servitudes, permits, conditions, covenants, exceptions, reservations, zoning and land use requirements and other title defects in any Property of Borrower or any Restricted Subsidiary, that in each case do not secure Debt and that in the aggregate do not materially impair the use of such Property for the purposes of which such Property is held by Borrower or any Restricted Subsidiary or materially impair the value of such Property subject thereto;
(h) Liens to secure performance of tenders, surety and appeal bonds, government contracts, performance and return of money bonds, bids, trade contracts,
leases, statutory obligations, regulatory obligations, obligations in respect of workers’ compensation, unemployment insurance or other forms of government benefits or insurance and other obligations of a like nature incurred in the ordinary course of business;
(i) Liens, titles and interests of lessors (including sub-lessors) of property leased by such lessors to Borrower or any Restricted Subsidiary, restrictions and prohibitions on encumbrances and transferability with respect to such property and Borrower’s or such Restricted Subsidiary’s interests therein imposed by such leases, and Liens and encumbrances encumbering such lessors’ titles and interests in such property and to which Borrower’s or such Restricted Subsidiary’s leasehold interests may be subject or subordinate, in each case, whether or not evidenced by Uniform Commercial Code financing statement filings or other documents of record, provided that such Liens do not secure Debt of Borrower or any Restricted Subsidiary and do not encumber Property of Borrower or any Restricted Subsidiary other than the Property that is the subject of such leases and items located thereon;
(j) Liens, titles and interests of licensors of software and other intangible property licensed by such licensors to Borrower or any Restricted Subsidiary, restrictions and prohibitions on encumbrances and transferability with respect to such property and Borrower’s or such Restricted Subsidiary’s interests therein imposed by such licenses, and Liens and encumbrances encumbering such licensors’ titles and interests in such property and to which Borrower’s or such Restricted Subsidiary’s license interests may be subject or subordinate, in each case, whether or not evidenced by Uniform Commercial Code financing statement filings or other documents of record, provided that such Liens do not secure Debt of Borrower or any Restricted Subsidiary and do not encumber Property of Borrower or any Restricted Subsidiary other than the Property that is the subject of such licenses;
(k) Liens securing Capital Leases and Purchase Money Debt permitted by Section 9.1(d) but only on the Property under lease or the Property purchased, constructed or improved with such Purchase Money Debt, together with any improvements, fixtures or accessions to such Property and the proceeds of such Property, improvements, fixtures or accessions;
(l) | judgment and attachment Liens not giving rise to an Event of Default; and |
(m) Liens of issuers of commercial letters of credit or similar undertakings on the goods that are the subject of such letters of credit or undertakings.
Provisions in the Loan Papers allowing Permitted Encumbrances on any item of Property shall be construed to allow such Permitted Encumbrances also to cover any improvements, fixtures or accessions to such Property and the proceeds of and insurance on such Property, improvements, fixtures or accessions. No intention to subordinate any Lien granted in favor of Administrative Agent and Banks is to be hereby implied or expressed by the permitted existence of any Permitted Encumbrances. Notwithstanding anything to the contrary contained in the foregoing, the term “Permitted Encumbrances” shall not include any Lien securing Debt for borrowed money other than Debt described in the preceding clauses (a) and (k).
“Permitted Holders” means, collectively, the Sponsors and members of management of Borrower or Parent.
“Permitted Investment” means:
(a) | accounts receivable arising in the ordinary course of business; |
(b)direct obligations of the United States or any agency thereof, or obligations fully guaranteed by the United States or any agency thereof, in each case maturing within one year from the date of acquisition thereof;
(c)commercial paper maturing within one year from the date of acquisition thereof rated in the highest grade by S&P or Moody’s;
(d)demand deposits and time deposits (including certificates of deposit) maturing within one year from the date of creation thereof with any Bank or any office located in the United States of any other bank or trust company which is organized under the laws of the United States or any state thereof, has capital, surplus and undivided profits aggregating at least $100,000,000 (as of the date of such bank or trust company’s most recent financial reports) and has a short term deposit rating of no lower than A2 (or then equivalent grade) or P2 (or then equivalent grade), as such rating is set forth from time to time, by S&P or Moody’s, respectively;
(e)shares of any SEC registered 2a-7 money market fund that has net assets of at least $500,000,000 and the highest rating obtainable from either Moody’s or S&P;
(f) | Investments made by a Credit Party in or to another Credit Party; |
(g)subject to the limits of Section 8.2, Investments (including capital contributions) in general or limited partnerships or other types of entities (each a “venture”) entered into by any Credit Party with others in the ordinary course of business; provided that (i) any such venture is engaged primarily in oil and gas exploration, development, production, processing and related activities, including transportation, (ii) the interest in such venture is acquired in the ordinary course of business and on fair and reasonable terms, and (iii) such venture interests acquired and capital contributions made (valued as of the date such interest was acquired or the contribution made) do not exceed, in the aggregate at any time outstanding, $5,000,000;
(h)Investments made in connection with entering into or performing operating agreements, mineral leases, processing agreements, farm-out agreements, contracts for the sale, transportation or exchange of oil and natural gas, unitization agreements, pooling arrangements, area of mutual interest agreements, production sharing agreements or other similar or customary agreements, transactions or arrangements, in each case made or entered into in the ordinary course of the oil and gas business, excluding, however, Investments in Equity Interests issued by other Persons; provided that, none of the foregoing shall involve the incurrence of any Debt not permitted by Section 9.1;
(i)Investments in stock, obligations or securities received in settlement of debts arising from Investments permitted under this definition, or owing to a Credit Party as a result of a bankruptcy or other insolvency proceeding of the obligor in respect of such debts or as a result of the enforcement of any Lien in favor of such Credit Party; provided that such Credit Party shall give Administrative Agent prompt written notice in the event that the aggregate amount of all investments held at any one time under this clause (i) exceeds $5,000,000;
(j)Investments in Unrestricted Subsidiaries, provided that (i) the aggregate unrecovered Invested amount of all such Investments shall not at any time exceed the sum of (A) $5,000,000 plus (B) any additional amounts funded entirely by capital contributions (other than proceeds of Disqualified Capital Stock) received by Borrower from the holders of its Equity Interests within ten (10) Business Days prior to the making of any such Investment and (ii) no Event of Default or Borrowing Base Deficiency shall exist at the time of, or immediately following, the making of such Investment; and
(k)other Investments of any kind not to exceed at any time the Threshold Amount in aggregate unrecovered Invested amount (provided that to the extent any Investments are received as partial consideration for entering into contracts for the gathering, processing, transportation or marketing of Hydrocarbons, such Investments shall be deemed to have an unrecovered Invested amount of zero).
“Permitted Tax Distributions” means, with respect to any taxable period (or portion thereof) during which Borrower is taxable as a partnership or is a disregarded entity for United States federal income tax purposes, one or more tax distributions to the member(s) of Borrower in an aggregate amount, with respect to each such taxable period (or portion thereof), that does not exceed the amount required to make a pro rata distribution to each direct or indirect owner of Borrower equal to (a) the product of (i) the sum of the highest marginal United States federal and New York state income tax rates applicable to individuals (or, if higher, corporations) on ordinary income (including any tax rate imposed on “net investment income” by Section 1411 of the Code, but without taking into account the deductibility of state and local taxes), multiplied by (ii) the taxable income (or estimates thereof) allocable to such direct or indirect owner of Borrower as a result of the operations or activities of Borrower and its Subsidiaries during such taxable period (or portion thereof) or (b) if higher, in the case of Parent and its Consolidated Subsidiaries, an amount that will enable Parent and its Consolidated Subsidiaries to timely satisfy all of their U.S. federal, state and local tax liabilities (including estimates thereof) arising solely from their direct or indirect interest in Borrower.
“Person” means an individual, a corporation, a partnership, a limited liability company, an association, a trust or any other entity or organization, including a government or political subdivision or an agency or instrumentality thereof.
“Pine Brook Group” means Pine Brook BXP Intermediate, L.P., Pine Brook BXP II Intermediate, L.P., Pine Brook PD Intermediate, L.P., any of the foregoing Persons’ Affiliates (other than portfolio companies thereof), and any fund managed or administered by any such Person or
any of its Affiliates, and the phrase “member of the Pine Brook Group” shall be construed accordingly.
“Plan” means any employee pension benefit plan, as defined in section 3(2) of ERISA, that is subject to Title IV of ERISA, section 302 of ERISA or section 412 of the Code and which (a) is currently or hereafter sponsored, maintained or contributed to by Borrower, a Subsidiary or an ERISA Affiliate or (b) was at any time during the six calendar years preceding the Effective Date, sponsored, maintained or contributed to by Borrower, a Credit Party or an ERISA Affiliate.
“Platform” has the meaning given to such term in Section 8.1.
“Property” means any interest in any kind of property or asset, whether real, personal or mixed, or tangible or intangible, including cash, securities, accounts and contract rights.
“Proved Mineral Interests” means, collectively, Proved Producing Mineral Interests, Proved Non-producing Mineral Interests, and Proved Undeveloped Mineral Interests.
“Proved Non-producing Mineral Interests” means all Mineral Interests to which proved developed non-producing reserves of oil or gas are attributed.
“Proved Producing Mineral Interests” means all Mineral Interests to which proved developed producing reserves of oil or gas are attributed.
“Proved Undeveloped Mineral Interests” means all Mineral Interests to which proved undeveloped reserves of oil or gas are attributed.
“Public Bank” has the meaning given to such term in Section 8.1.
“Purchase Money Debt” means Debt, the proceeds of which are used to finance the acquisition, construction, or improvement of inventory, equipment or other Property in the ordinary course of business; provided, however, that such Debt is incurred no later than 120 days after such acquisition or the completion of such construction or improvement.
“Qualified ECP Guarantor” means, with respect to any Benefitting Guarantor, in respect of any Hedge Transaction, each Credit Party that, at the time the guaranty by such Benefitting Guarantor of, or the grant by such Benefitting Guarantor of a security interest or other Lien securing, obligations under such Hedge Transaction is entered into or becomes effective with respect to, or at any other time such Benefitting Guarantor is by virtue of such guaranty or grant of a security interest or other Lien otherwise deemed to enter into, such Hedge Transaction, constitutes an Eligible Contract Participant and can cause such Benefitting Guarantor to qualify as an Eligible Contract Participant at such time by entering into a keepwell under Section 1a(18)(A)(v)(II) of the Commodity Exchange Act.
“Recipient” means (a) Administrative Agent, (b) any Bank and (c) any Letter of Credit Issuer, as applicable.
“Recognized Value” means, with respect to Proved Mineral Interests, the value attributed to such Mineral Interests in the most recent Determination of the Borrowing Base pursuant to Article IV (or for purposes of determining the initial Borrowing Base in the event no such Determination
has occurred), based upon the present value discounted at 10% per annum of the estimated net cash flow to be realized from the production of Hydrocarbons from such Mineral
Interests and taking into account the risk discounts applied by Banks to the various categories of Proved Mineral Interests.
“Redemption” means with respect to any Debt, the repurchase, redemption, prepayment, repayment, defeasance or any other acquisition or retirement for value (or the segregation of funds with respect to any of the foregoing) of such Debt. “Redeem” has the correlative meaning thereto.
“Register” has the meaning given to such term in Section 14.8(d).
“Regulation U” means Regulation U of the Board of Governors of the Federal Reserve System as in effect from time to time.
“Replacement Rate” has the meaning given to such term in Section 13.1(b).
“Request for Borrowing” means a request by Borrower for a Borrowing in accordance with Section 2.2.
“Request for Letter of Credit” means a request by Borrower for a Letter of Credit in accordance with Section 2.3.
“Required Banks” means (a) as long as the Commitments are in effect, Banks having an aggregate Applicable Percentage of 66-2/3% or more of the Aggregate Maximum Credit Amount, and (b) following termination or expiration of the Commitments, Banks holding 66-2/3% or more of the Outstanding Revolving Credit, subject in each case to Section 3.5(a); provided that, in each case, in the event there are only two or three Banks, Required Banks means at least two Banks.
“Required Payment” has the meaning given to such term in Section 3.4.
“Required Reserve Value” means Proved Mineral Interests that have a Recognized Value of not less than 80% of the Recognized Value of all Proved Mineral Interests held by Borrower and its Restricted Subsidiaries.
“Reserve Report” means an unsuperseded engineering analysis of the Mineral Interests owned by Borrower and its Restricted Subsidiaries in form and substance reasonably acceptable to Administrative Agent prepared in accordance with customary and prudent practices in the petroleum engineering industry for similarly-situated owners of non-operated Mineral Interests. Each Reserve Report required to be delivered by March 31 of each year pursuant to Section 4.1 shall be prepared by an Approved Petroleum Engineer. Each other Reserve Report may, at Borrower’s option, be prepared by Borrower’s in-house staff or by an Approved Petroleum Engineer. For purposes of Section 4.1, and until superseded, the Initial Reserve Report shall be considered a Reserve Report.
“Restricted Payment” means any dividend or other distribution (whether in cash, securities or other Property) with respect to any Equity Interest in Borrower or any of its Restricted Subsidiaries, or any payment (whether in cash, securities or other Property), including any sinking fund or similar deposit, on account of the purchase, redemption, retirement, acquisition, cancellation or termination of any Equity Interest in Borrower or any of its Restricted Subsidiaries.
“Restricted Subsidiary” means any Subsidiary of Borrower that is not an Unrestricted Subsidiary.
“Revolving Availability” means, at any time: (a) the Total Commitment in effect at such time minus (b) the Outstanding Revolving Credit at such time.
“Rolling Period” means (a) for each of the Fiscal Quarters ending June 30, 2019, September 30, 2019 and December 31, 2019, the applicable period commencing on April 1, 2019 and ending on the last day of such applicable Fiscal Quarter, and (b) for each Fiscal Quarter ending thereafter, any period of four consecutive Fiscal Quarters ending on the last day of such applicable Fiscal Quarter.
“Rollover Notice” has the meaning given to such term in Section 2.5(c).
“S&P” means Standard & Poor’s Ratings Group, a division of The XxXxxx-Xxxx Companies, Inc., and any successor thereto that is a nationally recognized rating agency.
“Sanctioned Country” means, at any time, a country or territory which is the subject or target of any Sanctions.
“Sanctioned Person” means, at any time, (a) any Person listed in any Sanctions-related list of designated Persons maintained by the Office of Foreign Assets Control of the U.S. Department of the Treasury or the U.S. Department of State, (b) any Person operating, organized or resident in a Sanctioned Country or (c) any Person controlled by any such Person.
“Sanctions” means economic or financial sanctions or trade embargoes imposed, administered or enforced from time to time by the U.S. government, including those administered by the Office of Foreign Assets Control of the U.S. Department of the Treasury or the U.S. Department of State.
“Schedule” means a “schedule” attached to this Agreement and incorporated herein by reference, unless specifically indicated otherwise.
“SEC” means the Securities and Exchange Commission or any successor Governmental Authority.
“Secured Hedge Provider” means any (a) Person that is a party to a Hedge Transaction with a Credit Party that entered into such Hedge Transaction before or while such Person was a Bank or an Affiliate of a Bank, whether or not such Person at any time ceases to be a Bank or an Affiliate of a Bank, as the case may be, or (b) assignee of any Hedge Transaction (by novation or otherwise) from any Person described in clause (a) above so long as such assignee is a Bank or an Affiliate of a Bank.
“Secured Parties” means, collectively, Administrative Agent, Banks, the Letter of Credit Issuer, the Bank Products Providers and Secured Hedge Providers, and “Secured Party” means any of them individually.
“Securities Account” shall have the meaning set forth in Article 8 of the UCC.
“Securities Act” means the Securities Act of 1933, as amended, and the rules and regulations promulgated thereunder.
“Security Agreement” means a security and pledge agreement substantially in the form of Exhibit G hereto to be executed by Borrower, and each existing and future Restricted Subsidiary of Borrower, pursuant to which each Credit Party grants a security interest in substantially all of its personal property (subject to the exclusions provided therein) in favor of Administrative Agent for the benefit of the Secured Parties to secure the Obligations, together with each other joinder or supplement thereto delivered pursuant to Article V or otherwise, in each case as amended, supplemented, or otherwise modified from time to time.
“Security Instruments” means the Facility Guaranty, the Security Agreement, the Mortgages, and any and all other agreements and instruments, now or hereafter executed and delivered by Borrower or any Restricted Subsidiary as security for, or as a guaranty of, the payment or performance of the Obligations, the Notes, this Agreement, or reimbursement obligations under the Letters of Credit, as such agreements or instruments may be amended, modified, supplemented or restated from time to time. Hedge Agreements do not constitute Security Instruments.
“Special Damages” has the meaning given to such term in Section 14.13.
“Special Determination” means any determination of the Borrowing Base pursuant to Article IV or Section 5.2 other than a Periodic Determination.
“Specified Parent Investment” means (a) any direct or indirect Investment made by Parent or any of its Subsidiaries (including Holdings) in Borrower and its Subsidiaries or (b) any other Investment made or asset owned by Parent or any of its Subsidiaries (including Holdings but other than Borrower and its Subsidiaries), so long as, with respect to this clause (b), the aggregate unrecovered Invested amount of all such Investments and fair market value of all such other assets does not at any time exceed $1,500,000.
“Sponsors” means each member of the Warburg Group, each member of the Pine Brook Group and each member of the Yorktown Group.
“Stockholders’ Agreement” means that certain Stockholders’ Agreement dated as of April 23, 2019 by and between the Sponsors and Parent as in effect on the Effective Date.
“Subsidiary” means, for any Person, any corporation or other entity of which securities or other ownership interests having ordinary voting power to elect a majority of the board of directors or other persons performing similar functions (including that of a general partner or managing member) are at the time directly or indirectly owned, collectively, by such Person and any Subsidiaries of such Person. The term “Subsidiary” shall include Subsidiaries of Subsidiaries (and so on).
“Super Majority Banks” means (a) as long as the Commitments are in effect, Banks having an aggregate Applicable Percentage of 80% or more of the Aggregate Maximum Credit Amount, and (b) following termination or expiration of the Commitments, Banks holding 80% or more of
the Outstanding Revolving Credit, subject in each case to Section 3.5(a); provided that, in each case, as long as there are less than three Banks, Super Majority Banks means all Banks.
“Taxes” means all present or future taxes, levies, imposts, duties, deductions, withholdings (including backup withholding), assessments, fees or other charges, or other charges imposed by any Governmental Authority, including any interest, additions to tax or penalties applicable thereto.
“Termination Date” means the earlier of (a) the Maturity Date and (b) any earlier date on which the Commitments, Aggregate Maximum Credit Amount or the Aggregate Elected Commitment Amount are terminated in full or otherwise reduced to zero, as the case may be, pursuant to Section 2.9, Section 2.15(f) or Section 11.1.
“Threshold Amount” means the greater of (a) $10,000,000 and (b) 7.5% of the Borrowing Base then in effect; provided that the Threshold Amount shall not exceed $20,000,000 at any time.
“Total Commitment” means the sum of all of the Banks’ Commitments.
“Total Net Funded Debt” means, at any date of determination, (a) the aggregate principal amount of all Debt (without duplication) of Borrower and its Consolidated Restricted Subsidiaries described in clauses (a), (b), (d) or (e) of the definition of “Debt”, other than Debt with respect to letters of credit to the extent such letters of credit have not been drawn (and subject to the proviso at the end of the definition of “Debt”) less (b) the amount of unrestricted cash and cash equivalents of Borrower and its Consolidated Restricted Subsidiaries on such date; provided that the amount under this clause (b) shall not exceed $25,000,000.
“Tranche” means an Adjusted Base Rate Tranche or a Eurodollar Tranche and “Tranches” means Adjusted Base Rate Tranches or Eurodollar Tranches or any combination thereof.
“Type” means with reference to a Tranche, the characterization of such Tranche as an Adjusted Base Rate Tranche or a Eurodollar Tranche based on the method by which the accrual of interest on such Tranche is calculated.
“UCC” means the Uniform Commercial Code, as in effect from time to time, of the State of New York or of any other state the laws of which are required as a result thereof to be applied in connection with the attachment, perfection or priority of, or remedies with respect to, Administrative Agent’s or any Secured Party’s Lien pursuant to any Security Instrument.
“USA Patriot Act” means the USA PATRIOT ACT (Title III of Pub. L. 107-56 (signed into law October 26, 2001)).
“U.S. Person” means any Person that is a “United States Person” as defined in Section 7701(a)(30) of the Code.
“U.S. Tax Compliance Certificate” has the meaning given such term in Section 13.5(g).
“Unrestricted Subsidiary” means any Subsidiary of Borrower designated as such on Schedule 3 or which Borrower has designated in writing to Administrative Agent to be an Unrestricted Subsidiary pursuant to Section 9.11.
“Warburg Group” means Xxxxxxx Parent Holdings, L.P., Warburg Pincus Private Equity (E&P) XI-A (Xxxxxxx), LLC, Warburg Pincus XI (E&P) Partners-A (Xxxxxxx), LLC, XX Xxxxxxx Holdings, L.P., WP Energy Xxxxxxx Holdings, L.P., WP Energy Partners Xxxxxxx Holdings, L.P., Warburg Pincus Energy (E&P) Partners-A (Xxxxxxx), LLC, Warburg Pincus Energy (E&P)-A (Xxxxxxx), LLC, any of the foregoing Persons’ Affiliates (other than portfolio companies thereof), and any fund managed or administered by any such Person or any of its Affiliates, and the phrase “member of the Warburg Group” shall be construed accordingly.
“Withholding Agent” means any Credit Party or Administrative Agent.
“Write-Down and Conversion Powers” means, with respect to any EEA Resolution Authority, the write-down and conversion powers of such EEA Resolution Authority from time to time under the Bail-In Legislation for the applicable EEA Member Country, which write-down and conversion powers are described in the EU Bail-In Legislation Schedule.
“Yorktown Group” means Yorktown Energy Partners IX, L.P., Yorktown Energy Partners X, L.P., Yorktown Energy Partners XI, L.P., YT Xxxxxxx Co Investment Partners, LP, any of the foregoing Persons’ Affiliates (other than portfolio companies thereof), and any fund managed or administered by any such Person or any of its Affiliates, and the phrase “member of the Yorktown Group” shall be construed accordingly.
Section 1.3 Accounting Terms and Determinations. Unless otherwise specified herein, all accounting terms used herein shall be interpreted, all accounting determinations hereunder shall be made, and all financial statements required to be delivered hereunder shall be prepared, in accordance with GAAP as in effect from time to time, applied on a basis consistent with the most recent audited consolidated financial statements delivered to Banks except (a) that, notwithstanding GAAP and FASB ASC 842, Borrower’s and Parent’s accounting treatment of capital leases and operating leases for covenant compliance purposes hereunder shall be consistent with Borrower’s accounting treatment thereof as was in effect on December 15, 2018 and (b) for changes in which Borrower’s and/or Parent’s independent certified public accountants concur and which are disclosed to Administrative Agent on the next date on which financial statements are required to be delivered to Banks pursuant to Section 8.1(a) and Section 8.1(b); provided that, unless Borrower and Majority Banks shall otherwise agree in writing, no such change shall modify or affect the manner in which compliance with the covenants contained in Article IX or Article X are computed such that all such computations shall be conducted utilizing financial information presented consistently with prior periods. Any financial ratios required to be maintained by Borrower pursuant to this Agreement shall be calculated by dividing the appropriate component by the other component, carrying the result to one place more than the number of places by which such ratio is expressed herein and rounding the result up or down to the nearest number (with a rounding-up if there is no nearest number). Notwithstanding anything herein to the contrary, for the purposes of calculating any of the ratios tested under Section 10.1, and the components of each of such ratios, all Unrestricted
Subsidiaries, and their Subsidiaries (including their assets, liabilities, income, losses, cash flows, and the elements thereof) shall be excluded, except for any
cash dividends or distributions actually paid by any Unrestricted Subsidiary or any of its Subsidiaries to Borrower or any Restricted Subsidiary, which shall be deemed to be income to Borrower or such Restricted Subsidiary when actually received by it.
Section 1.4 Classification of Loans and Borrowings. For purposes of this Agreement, Loans may be classified and referred to by Type (e.g., a “Eurodollar Loan”). Borrowings also may be classified and referred to by Type (e.g., a “Eurodollar Borrowing”).
Section 1.5 Interpretation. As used herein, the term “including” in its various forms means including without limitation. The definitions of terms herein shall apply equally to the singular and plural forms of the terms defined. The word “will” shall be construed to have the same meaning and effect as the word “shall”. The word “or” is not exclusive. Unless the context requires otherwise (a) any definition of or reference to any agreement, instrument or other document herein shall be construed as referring to such agreement, instrument or other document as from time to time amended, supplemented or otherwise modified (subject to any restrictions on such amendments, supplements or modifications set forth in the Loan Papers), (b) any reference herein to any Law shall be construed as referring to such Law as amended, modified, codified or reenacted, in whole or in part, and in effect from time to time, (c) any reference herein to any Person shall be construed to include such Person’s successors and assigns (subject to the restrictions contained in the Loan Papers), (d) the words “herein”, “hereof” and “hereunder”, and words of similar import, shall be construed to refer to this Agreement in its entirety and not to any particular provision hereof, (e) with respect to the determination of any time period, the word “from” means “from and including” and the word “to” means “to and including” and (f) any reference herein to Articles, Sections, Annexes, Exhibits and Schedules shall be construed to refer to Articles and Sections of, and Annexes, Exhibits and Schedules to, this Agreement. Unless otherwise specified, all references herein to times of day shall be references to Eastern time (daylight or standard, as applicable). No provision of this Agreement or any other Loan Paper shall be interpreted or construed against any Person solely because such Person or its legal representative drafted such provision.
Section 1.6 Rates. Administrative Agent does not warrant or accept responsibility for, and shall not have any liability with respect to, the administration, submission or any other matter related to the rates in the definition of “LIBOR Rate”.
Section 1.7 Divisions. For all purposes under the Loan Papers, in connection with any division or plan of division under Delaware law (or any comparable event under a different jurisdiction’s laws): (a) if any asset, right, obligation or liability of any Person becomes the asset, right, obligation or liability of a different Person, then it shall be deemed to have been transferred from the original Person to the subsequent Person, and (b) if any new Person comes into existence, such new Person shall be deemed to have been organized on the first date of its existence by the holders of its Equity Interests at such time.
ARTICLE II
THE CREDIT FACILITIES
Section 2.1 Commitments.
(a)Subject to Section 2.1(c) and the other terms and conditions set forth in this Agreement, each Bank severally agrees to lend to Borrower from time to time prior to the Termination Date amounts not to exceed in the aggregate at any one time outstanding, the amount of such Bank’s Commitment less such Bank’s Letter of Credit Exposure, to the extent any such Loan would not cause the Outstanding Revolving Credit to exceed the Total Commitment. Each Borrowing shall (i) be in an aggregate principal amount of $500,000 or any larger integral multiple of $100,000, and (ii) be made from each Bank ratably in accordance with its respective Applicable Percentage. Subject to the foregoing limitations and the other provisions of this Agreement, Borrower may borrow under this Section 2.1(a), repay amounts borrowed under this Section 2.1(a) and request new Borrowings under this Section 2.1(a).
(b)The Letter of Credit Issuer will issue Letters of Credit, from time to time during the Letter of Credit Period upon request by Borrower, for the account of Borrower, so long as (i) the sum of (A) the total Letter of Credit Exposure of all Banks then existing, and (B) the amount of the requested Letter of Credit, does not exceed the lesser of (x) $10,000,000 and (y) the Total Commitment (i.e., the least of (x) the Aggregate Maximum Credit Amounts, (y) the then effective Borrowing Base and (z) the then effective Aggregate Elected Commitment Amount), and
(ii) Borrower would be entitled to a Borrowing under Section 2.1(c) and Section 6.2 in the amount of the requested Letter of Credit; provided that, the Letter of Credit Issuer shall not be under any obligation to issue any Letter of Credit if a default of any Bank’s obligations to fund under Section
2.1 exists or any Bank is at such time a Defaulting Bank hereunder, unless the Letter of Credit Issuer has entered into arrangements satisfactory to Letter of Credit Issuer with Borrower or such Bank to eliminate the Letter of Credit Issuer’s risk with respect to such Bank. Not less than three Business Days prior to the requested date of issuance of any such Letter of Credit, Borrower shall execute and deliver to the Letter of Credit Issuer, the Letter of Credit Issuer’s customary letter of credit application (“Letter of Credit Application”). Each Letter of Credit shall be in form and substance acceptable to Letter of Credit Issuer. Unless otherwise expressly agreed by the Letter of Credit Issuer and Borrower when a Letter of Credit is issued, the rules of the ISP shall apply to each standby Letter of Credit. No Letter of Credit shall have an expiration date later than the earlier of (1) five Business Days prior to the Termination Date and (2) one year from the date of issuance (subject to any applicable automatic renewal provision) and no Letter of Credit shall be issued in a currency other than U.S. Dollars. Upon the date of issuance of a Letter of Credit, the Letter of Credit Issuer shall be deemed to have sold to each other Bank, and each other Bank shall be deemed to have unconditionally and irrevocably purchased from the Letter of Credit Issuer, a non-recourse participation in the related Letter of Credit and Letter of Credit Exposure equal to such Bank’s Applicable Percentage of such Letter of Credit and Letter of Credit Exposure. Upon request of any Bank, Administrative Agent shall provide notice to each Bank by telephone or facsimile setting forth each Letter of Credit issued and outstanding pursuant to the terms hereof and specifying the Letter of Credit Issuer, beneficiary and expiration date of each such Letter of Credit, each Bank’s participation percentage of each such Letter of Credit and the actual dollar amount of each Bank’s participation held by Letter of Credit Issuer(s) thereof for such Bank’s account and risk. In connection with the issuance of Letters of Credit hereunder, Borrower shall pay to Administrative Agent in respect of such Letters of Credit (a) the applicable Letter of Credit Fee in accordance with Section 2.12, (b) the applicable Letter of Credit Fronting Fee in accordance with Section 2.12, and (c) all
customary administrative, issuance, amendment, payment, and negotiation charges of the Letter of Credit Issuer; provided that, no such Letter of Credit Fee shall
accrue or be deemed to have accrued, or be owing or payable by Borrower to Administrative Agent or any Letter of Credit Issuer for the account of any Defaulting Bank with respect to its share of such Letter of Credit Fee in the event Borrower has entered into an arrangement with or provided cash collateral to the Letter of Credit Issuer with respect to the Letter of Credit Issuer’s risk with respect to such Bank’s obligation to fund its Applicable Percentage share of the aggregate existing Letter of Credit Exposure with respect to such Letter of Credit. Administrative Agent shall distribute the Letter of Credit Fee to Banks in accordance with their respective Applicable Percentages, and Administrative Agent shall distribute the Letter of Credit Fronting Fee, and the charges described in clause (c) of the immediately preceding sentence, to the Letter of Credit Issuer for its own account. Any increase, renewal or extension of any Letter of Credit shall be deemed to be the issuance of a new Letter of Credit for purposes of this Section 2.1(b).
Upon the occurrence of an Event of Default, Borrower shall, on the next succeeding Business Day, deposit with Administrative Agent such funds as Administrative Agent may request, up to a maximum amount equal to the aggregate existing Letter of Credit Exposure of all Banks. Any funds so deposited shall be held by Administrative Agent for the ratable benefit of all Banks as security for the outstanding Letter of Credit Exposure and the other Obligations, and Borrower will, in connection therewith, execute and deliver such Security Instruments with respect to such deposit of funds in form and substance satisfactory to Administrative Agent which it may, in its discretion, require. As drafts or demands for payment are presented under any Letter of Credit, Administrative Agent shall apply such funds to satisfy such drafts or demands. When all Letters of Credit have expired and the Obligations have been repaid in full (and the Commitments of all Banks have terminated) or such Event of Default has been cured to the satisfaction of Majority Banks, Administrative Agent shall release to Borrower any remaining funds deposited under this Section 2.1(b). Whenever Borrower is required to make deposits under this Section 2.1(b) and fail to do so on the day such deposit is due, Administrative Agent or any Bank may, without notice to Borrower, make such deposit (whether by application of proceeds of any collateral for the Obligations, by transfers from other accounts maintained with any Bank or otherwise) using any funds then available to any Bank of Borrower, any guarantor, or any other Person liable for all or any part of the Obligations.
In the event there exists one or more Defaulting Banks, Borrower shall, on the next succeeding Business Day following request from Administrative Agent, deposit with Administrative Agent such funds as Administrative Agent may reasonably request, up to a maximum Letter of Credit Exposure attributable to such Defaulting Bank(s) as security for such Defaulting Bank’s Letter of Credit Exposure. As drafts or demands for payment are presented under any Letter of Credit, Administrative Agent shall apply such funds to satisfy drafts or demands attributable to such Defaulting Bank(s). When there are no longer any Defaulting Banks or no longer any Letters of Credit outstanding, Administrative Agent shall release to Borrower any remaining funds deposited under this paragraph.
Notwithstanding anything to the contrary contained herein, Borrower hereby agrees to reimburse the Letter of Credit Issuer, in immediately available funds, for any payment or disbursement made by the Letter of Credit Issuer under any Letter of Credit issued by it (x) on the same Business Day the Letter of Credit Issuer makes demand for such reimbursement if such demand
is made at or prior to 11:00 a.m. (New York, New York time) and (y) on the next Business Day after such demand for reimbursement if such demand is made after 11:00 a.m. (New York,
New York time). Payment shall be made by Borrower with interest on the amount so paid or disbursed by the Letter of Credit Issuer from and including the date payment is made under any Letter of Credit to but excluding the date of payment, at the lesser of (i) the Maximum Lawful Rate, or (ii) the Default Rate. The obligations of Borrower under this paragraph will continue until all Letters of Credit have expired and all reimbursement obligations with respect thereto have been paid in full by Borrower and until all other Obligations shall have been paid in full.
The reimbursement obligations of Borrower under this Section 2.1(b) shall be absolute, unconditional and irrevocable, and shall be performed strictly in accordance with the terms of the Loan Papers (including any Letter of Credit Application executed pursuant to this Section 2.1(b)) under and in all circumstances whatsoever and Borrower hereby waives any defense to the payment of such reimbursement obligations based on any circumstance whatsoever, including in any case, the following circumstances: (i) any lack of validity or enforceability of any Letter of Credit; (ii) the existence of any claim, set-off, counterclaim, defense or other rights which Borrower or any other Person may have at any time against any beneficiary of any Letter of Credit, Administrative Agent, any Bank or any other Person, whether in connection with any Letter of Credit or any unrelated transaction; (iii) any statement, draft or other documentation presented under any Letter of Credit proving to be forged, fraudulent, invalid or insufficient in any respect or any statement therein being untrue or inaccurate in any respect whatsoever; (iv) payment by the Letter of Credit Issuer under any Letter of Credit against presentation of a draft or other document that does not comply with the terms of such Letter of Credit; or (v) any other circumstance whatsoever, whether or not similar to any of the foregoing; provided that the Letter of Credit Issuer shall not be excused from liability to Borrower to the extent of any direct damages (as opposed to consequential damages, claims in respect of which are hereby waived by Borrower to the extent permitted by applicable law) suffered by Borrower that are caused by the Letter of Credit Issuer’s failure to exercise due care when determining whether drafts and other documents presented under a Letter of Credit comply with the terms thereof or by the Letter of Credit Issuer’s gross negligence or willful misconduct.
As among Borrower on the one hand, Administrative Agent, and each Bank, on the other hand, Borrower assumes all risks of the acts and omissions of, or misuse of Letters of Credit by, the beneficiary of such Letters of Credit. In furtherance and not in limitation of the foregoing, none of Administrative Agent, the Letter of Credit Issuer or any Bank shall be responsible for:
(i) the form, validity, sufficiency, accuracy, genuineness or legal effect of any document submitted by any Person in connection with the application for and issuance of and presentation of drafts with respect to any Letter of Credit, even if it should prove to be in any or all respects invalid, insufficient, inaccurate, fraudulent or forged;
(ii) the validity or sufficiency of any instrument transferring or assigning or purporting to transfer or assign the Letter of Credit or the rights or benefits thereunder or proceeds thereof, in whole or in part, which may prove to be invalid or ineffective for any reason;
(iii) the failure of the beneficiary of the Letter of Credit to comply duly with conditions required in order to draw upon such Letter of Credit;
(iv) errors, omissions, interruptions or delays in transmission or delivery of any messages, by mail, cable, telegraph, or otherwise, whether or not they be in cipher;
(v) | errors in interpretation of technical terms; |
(vi) any loss or delay in the transmission or otherwise of any document required in order to make a drawing under any Letter of Credit or of the proceeds thereof;
(vii) the misapplication by the beneficiary of the Letter of Credit of the proceeds of any drawing under such Letter of Credit; or
(viii) any consequences arising from causes beyond the control of Administrative Agent or any Bank.
In furtherance of the foregoing and without limiting the generality thereof, the parties agree that, with respect to documents presented which appear on their face to be in substantial compliance with the terms of a Letter of Credit, the Letter of Credit Issuer may, in its sole discretion, either accept and make payment upon such documents without responsibility for further investigation, regardless of any notice or information to the contrary, or refuse to accept and make payment upon such documents if such documents are not in strict compliance with the terms of such Letter of Credit.
Borrower shall be obligated to reimburse the Letter of Credit Issuer through Administrative Agent upon demand for all amounts paid under Letters of Credit as set forth in the third paragraph of this Section 2.1(b); provided that, if Borrower for any reason fails to reimburse the Letter of Credit Issuer in full when such reimbursement is required under such paragraph, Banks shall reimburse the Letter of Credit Issuer in accordance with each Bank’s Applicable Percentage for amounts due and unpaid from Borrower as set forth herein below; provided further that, no such reimbursement made by Banks shall discharge Borrower’s obligations to reimburse the Letter of Credit Issuer. All reimbursement amounts payable by any Bank under this Section 2.1(b) shall include interest thereon at the Federal Funds Rate, from the date of the payment of such amounts by the Letter of Credit Issuer to but excluding the date of reimbursement by such Bank. No Bank shall be liable for the performance or nonperformance of the obligations of any other Bank under this paragraph. The reimbursement obligations of Banks under this paragraph shall continue after the Termination Date and shall survive termination of this Agreement and the other Loan Papers.
Unless otherwise specified herein, the amount of a Letter of Credit at any time shall be deemed to be the stated amount of such Letter of Credit in effect at such time; provided that, with respect to any Letter of Credit that, by its terms or the terms of any Letter of Credit Application or other document related to such Letter of Credit, provides for one or more automatic increases in the stated amount thereof, the amount of such Letter of Credit shall be deemed to be the maximum stated amount of such Letter of Credit after giving effect to all such increases, whether or not such maximum stated amount is in effect at such time.
In the event of any conflict between the terms hereof and the terms of any Letter of Credit Application, the terms hereof shall control.
(c)No Bank will be obligated to lend to Borrower or incur Letter of Credit Exposure under this Section 2.1, and Borrower shall not be entitled to borrow hereunder or obtain Letters of Credit hereunder (i) if the amount of the Outstanding Revolving Credit exceeds the Total Commitment at such time, or (ii) in an amount which would cause the Outstanding Revolving Credit to exceed the Total Commitment. Nothing in this Section 2.1(c) shall be deemed to limit any Bank’s obligation to reimburse the Letter of Credit Issuer with respect to such Bank’s participation in Letters of Credit issued by the Letter of Credit Issuer as provided in Section 2.1(b).
Section 2.2 Method of Borrowing.
(a)In order to request any Borrowing hereunder, Borrower shall hand deliver or telecopy to Administrative Agent a duly completed Request for Borrowing (i) prior to 10:00
a.m. (Central time) on the Borrowing Date of a proposed Adjusted Base Rate Borrowing, and (ii) prior to 11:00 a.m. (Central time) at least three (3) Eurodollar Business Days before the Borrowing Date of a proposed Eurodollar Borrowing. Each such Request for Borrowing shall be substantially in the form of Exhibit B hereto, and shall specify:
(A) whether such Borrowing is to be an Adjusted Base Rate Borrowing or a Eurodollar Borrowing;
(B) the Borrowing Date of such Borrowing, which shall be a Business Day in the case of an Adjusted Base Rate Borrowing, or a Eurodollar Business Day in the case of a Eurodollar Borrowing;
(C) | the aggregate amount of such Borrowing; |
(D) in the case of a Eurodollar Borrowing, the duration of the Interest Period applicable thereto, subject to the provisions of the definition of Interest Period;
(E) | the Outstanding Revolving Credit exposure on the date |
thereof; and
(F) | the pro forma Outstanding Revolving Credit exposure |
(giving effect to the requested Borrowing).
Each Request for Borrowing shall constitute a representation by Borrower that the amount of the requested Borrowing shall not cause the total Outstanding Revolving Credit to exceed the Total Commitment (i.e., the least of (x) the Aggregate Maximum Credit Amounts, (y) the then effective Borrowing Base and (z) the then effective Aggregate Elected Commitment Amount).
(b)Upon receipt of a Request for Borrowing described in Section 2.2(a), Administrative Agent shall promptly notify each Bank (as applicable) of the contents thereof and the amount of the Borrowing to be loaned by such Bank pursuant thereto, and such Request for Borrowing shall not thereafter be revocable by Borrower.
(c)Not later than 12:00 noon (Central time) on the date of each Borrowing, each Bank shall make available its Applicable Percentage of such Borrowing, in funds immediately available to Administrative Agent at its address set forth on Schedule 1 hereto.
Unless Administrative Agent determines that any applicable condition specified in Section 6.2 has not been satisfied, Administrative Agent will make the funds so received from Banks available to Borrower at Administrative Agent’s aforesaid address or, if requested by Borrower, by wire transfer of such funds as specified by Borrower.
Section 2.3 Method of Requesting Letters of Credit.
(a)In order to request any Letter of Credit hereunder, Borrower shall hand deliver or telecopy to the Letter of Credit Issuer with a copy to Administrative Agent a duly completed Request for Letter of Credit prior to 10:00 a.m. (Central time) at least three Business Days before the date specified for issuance of such Letter of Credit. Each Request for Letters of Credit shall be substantially in the form of Exhibit C hereto, shall be accompanied by the applicable Letter of Credit Issuer’s duly completed and executed Letter of Credit Application and shall specify:
(i) | the requested date for issuance of such Letter of Credit; |
(ii) the terms of such requested Letter of Credit, including the name and address of the beneficiary, the stated amount, the expiration date and the text of the certificate to be presented along with drafts under such Letter of Credit;
(iii) | the Outstanding Revolving Credit exposure on the date thereof; and |
(iv) the pro forma total Outstanding Revolving Credit exposure (giving effect to the requested Letter of Credit issuance).
A Letter of Credit shall be issued, amended, renewed or extended only if (and each Request for Letter of Credit in connection therewith shall constitute a representation and warranty by Borrower that), after giving effect to the requested issuance, amendment, renewal or extension, as applicable, (A) the sum of (1) the total Letter of Credit Exposure of all Banks then existing and (2) the amount of the issued, amended, renewed or extended Letter of Credit Exposure does not exceed the lesser of (x) $10,000,000 and (y) the Total Commitment (i.e., the least of (x) the Aggregate Maximum Credit Amounts, (y) the then effective Borrowing Base and (z) the then effective Aggregate Elected Commitment Amount) and (B) the total Outstanding Revolving Credit exposure shall not exceed the Total Commitment (i.e., the least of (x) the Aggregate Maximum Credit Amounts, (y) the then effective Borrowing Base and (z) the then effective Aggregate Elected Commitment Amount).
(b)Upon receipt of a Request for Letter of Credit described in Section 2.3(a), Administrative Agent shall promptly notify each Bank of the contents thereof, including the amount of the requested Letter of Credit, and such Request for Letter of Credit shall not thereafter be revocable by Borrower.
(c)No later than 12:00 noon (Central time) on the date specified for the issuance of such Letter of Credit, unless Administrative Agent notifies the Letter of Credit Issuer that any applicable condition precedent set forth in Section 6.2 has not been satisfied, the
applicable Letter of Credit Issuer will issue and deliver such Letter of Credit pursuant to the instructions of Borrower.
Notwithstanding anything herein to the contrary, the Letter of Credit Issuer shall have no obligation hereunder to issue, and shall not issue, any Letter of Credit (1) the proceeds of which would be made available to any Person (A) to fund any activity or business of or with any Sanctioned Person, or in any country or territory that, at the time of such funding, is the subject of any Sanctions or (B) in any manner that would result in a violation of any Sanctions by any party to this Agreement, (2) if any order, judgment or decree of any Governmental Authority or arbitrator, in either case, with jurisdiction over the Letter of Credit Issuer, shall by its terms purport to enjoin or restrain the Letter of Credit Issuer from issuing such Letter of Credit, or any Law relating to the Letter of Credit Issuer or any Governmental Authority with jurisdiction over the Letter of Credit Issuer shall prohibit, the issuance of letters of credit generally or such Letter of Credit in particular or shall impose upon the Letter of Credit Issuer with respect to such Letter of Credit any reserve or capital requirement (for which the Letter of Credit Issuer is not otherwise compensated hereunder) not in effect on the Effective Date, or shall impose upon the Letter of Credit Issuer any unreimbursed loss, cost or expense which was not applicable on the Effective Date and which the Letter of Credit Issuer in good xxxxx xxxxx material to it or (3) if the issuance of such Letter of Credit would violate one or more policies of the Letter of Credit Issuer applicable to letters of credit generally under similar circumstances for similarly situated borrowers; provided that, notwithstanding anything herein to the contrary, (x) the Xxxx Xxxxx Wall Street Reform and Consumer Protection Act and all requests, rules, guidelines, requirements or directives thereunder or issued in connection therewith or in the implementation thereof, and (y) all requests, rules, guidelines, or directives promulgated by the Bank for International Settlements, the Basel Committee on Banking Supervision (or any successor or similar authority) or the United States or foreign regulatory authorities, in each case pursuant to Basel III, shall in each case be deemed not to be in effect on the Effective Date for purposes of clause (2) above, regardless of the date enacted, adopted, issued or implemented.
Section 2.4 Notes. Upon request by any Bank, the Loans made by such Bank shall be evidenced by a single promissory note of Borrower in substantially the form of Exhibit A, dated, in the case of (a) any Bank party hereto as of the date of this Agreement, as of the date of this Agreement, (b) any Bank that becomes a party hereto pursuant to an Assignment and Assumption Agreement, as of the effective date of the Assignment and Assumption Agreement, or (c) any Additional Bank that becomes a party hereto in connection with an increase in the Aggregate Elected Commitment Amount pursuant to Section 2.15(b), as of the effective date of such increase, in each case, payable to such Bank in a principal amount equal to its Maximum Credit Amount as in effect on such date, and otherwise duly completed. In the event that any Bank’s Maximum Credit Amount increases or decreases for any reason, Borrower shall deliver or cause to be delivered on the effective date of such increase or decrease (to the extent so requested), a new Note payable to such Bank in a principal amount equal to its Maximum Credit Amount after giving effect to such increase or decrease, and otherwise duly completed. Borrower will be obligated, as provided herein, to repay the Loans made by each Bank regardless of whether or not such Bank requests a Note.
Section 2.5 Interest Rates; Payments; No Premiums.
(a)The principal amount of the Loans outstanding from day to day which is the subject of an Adjusted Base Rate Tranche shall bear interest (computed on the basis of actual days elapsed in a 365 or 366 day year, as applicable) at a rate per annum equal to the sum of (i) the Adjusted Base Rate, plus (ii) the Applicable Margin; provided that in no event shall the rate charged hereunder or under the Notes exceed the Maximum Lawful Rate. Interest on any portion of the principal of the Loans subject to an Adjusted Base Rate Tranche shall be payable as it accrues on the last day of each Fiscal Quarter.
(b)The principal amount of the Loans outstanding from day to day which is the subject of a Eurodollar Tranche shall bear interest (computed on the basis of actual days elapsed and as if each calendar year consisted of 360 days, unless such computation would exceed the Maximum Lawful Rate in which case interest shall be computed on the basis of actual days elapsed in a 365 or 366 day year, as applicable) for the Interest Period applicable thereto at a rate per annum equal to the sum of (i) the Adjusted LIBOR Rate, plus (ii) the Applicable Margin; provided, that in no event shall the rate charged hereunder or under the Notes exceed the Maximum Lawful Rate. Interest on any portion of the Loans subject to a Eurodollar Tranche having an Interest Period of six (6) or twelve (12) months shall be payable on the last day of such Interest Period and on the last day of the initial three-month period and, as applicable, each subsequent, three-month period during such Interest Period.
(c)So long as no Default or Event of Default shall be continuing, subject to the provisions of this Section 2.5, Borrower shall have the option of having all or any portion of the principal outstanding under the Loans borrowed by it be the subject of an Adjusted Base Rate Tranche or one or more Eurodollar Tranches, which shall bear interest at rates based upon the Adjusted Base Rate and the Adjusted LIBOR Rate, respectively (each such option is referred to herein as an “Interest Option”); provided that each Tranche shall be in a minimum amount of
$500,000 and shall be in an amount which is an integral multiple of $100,000. Each change in an Interest Option made pursuant to this Section 2.5(c) shall, for purposes of determining how much of the Loans are the subject of an Adjusted Base Rate Tranche and how much of the Loans are the subject of Eurodollar Tranches only (and for no other purpose), be deemed both a payment in full of the portion of the principal of the Loans which was the subject of the Adjusted Base Rate Tranche or Eurodollar Tranche from which such change was made and a Borrowing (notwithstanding that the unpaid principal amount of the Loans is not changed thereby) of the portion of the principal of the Loans which is the subject of the Adjusted Base Rate Tranche or Eurodollar Tranche into which such change was made. Prior to the termination of each Interest Period with respect to each Eurodollar Tranche, Borrower shall give written notice (a “Rollover Notice”) in the form of Exhibit D attached hereto to Administrative Agent of the Interest Option which shall be applicable to such portion of the principal of the Loans upon the expiration of such Interest Period. Such Rollover Notice shall be given to Administrative Agent by the time a Request for Borrowing would be required under Section 2.2 if Borrower were requesting a Borrowing of the Type resulting from such election, prior to the termination of the Interest Period then expiring. If Borrower shall specify a Eurodollar Tranche, such Rollover Notice shall also specify the length of the succeeding Interest Period (subject to the provisions of the definitions of such term) selected by Borrower. Each Rollover Notice shall be irrevocable and effective upon notification thereof to Administrative Agent. If the required Rollover Notice shall not have been timely received by Administrative Agent, Borrower shall be
deemed to have elected that the principal of any Loan subject to the Interest Period then expiring be the subject of an Adjusted Base Rate Tranche upon
the expiration of such Interest Period, and Borrower will be deemed to have given Administrative Agent notice of such election. Subject to the limitations set forth in this Section 2.5(c) on the minimum amount of Eurodollar Tranches, Borrower shall have the right to convert all or part of the Adjusted Base Rate Tranche to a Eurodollar Tranche by giving Administrative Agent a Rollover Notice of such election at least three (3) Eurodollar Business Days prior to the date on which Borrower elects to make such conversion (a “Conversion Date”). The Conversion Date selected by Borrower shall be a Eurodollar Business Day. Notwithstanding anything in this Section 2.5 to the contrary, no portion of the principal of any Loan which is the subject of an Adjusted Base Rate Tranche may be converted to a Eurodollar Tranche and no Eurodollar Tranche may be continued as such when any Event of Default has occurred and is continuing, but each such Tranche shall be automatically converted to an Adjusted Base Rate Tranche on the last day of each applicable Interest Period. If at Borrower’s election any Eurodollar Tranche is converted into an Adjusted Base Rate Tranche prior to the end of an Interest Period, Borrower will make any payment required by Section 3.3. In no event shall more than ten (10) Interest Periods be in effect with respect to the Loans at any time.
(d)Notwithstanding anything to the contrary set forth in Section 2.5(a) or Section 2.5(b), all overdue principal of and, to the extent permitted by Law, overdue interest on the Loans and all other Obligations which are not paid in full when due (whether at stated maturity, by acceleration or otherwise), for the period from and including the due date thereof to but excluding the date the same is paid in full, shall bear interest, at a rate per annum equal to the lesser of (i) the Default Rate, and (ii) the Maximum Lawful Rate. Interest payable as provided in this Section 2.5(d) shall be payable from time to time on demand.
(e)Administrative Agent shall determine each interest rate applicable to the Loans in accordance with the terms hereof. Administrative Agent shall promptly notify Borrower and Banks by telecopy or e-mail of each rate of interest so determined, and its determination thereof shall be conclusive in the absence of manifest error.
(f)All prepayments made or required under this Agreement, whether mandatory or voluntary or otherwise, shall be without premium or penalty, provided that Borrower shall be obligated to make any payments required under Section 3.3.
Section 2.6 Mandatory Prepayments.
(a)Promptly (and in any event within two Business Days) after the consummation by any Credit Party of any Asset Disposition pursuant to Section 9.5 that creates a Borrowing Base Deficiency (or increase in any existing Borrowing Base Deficiency) pursuant to Section 4.6, Borrower shall (i) apply a portion of the Net Cash Proceeds equal to such Borrowing Base Deficiency (or increase in any previously existing Borrowing Base Deficiency) as a mandatory prepayment on the Loans and (ii) if a Borrowing Base Deficiency remains after prepaying all of the Loans as a result of Letter of Credit Exposure, deposit with Administrative Agent on behalf of the Banks an amount equal to such Borrowing Base Deficiency (or increase in any previously existing Borrowing Base Deficiency) to be held as cash collateral to the extent required pursuant to Section 2.1(b); provided that the Borrowing Base Deficiency must be eliminated on or prior to the Termination Date. Notwithstanding the foregoing, if an Event of Default exists on the date of the consummation of any Asset Disposition, then, unless Required
Banks and Borrower agree otherwise, all Net Cash Proceeds from any such Asset Disposition shall be applied as a mandatory prepayment on the Loans in accordance with Section 3.2(c).
(b)Promptly (and in any event within two Business Days) after the incurrence or issuance by any Credit Party of any Permitted Additional Debt that creates a Borrowing Base Deficiency pursuant to Section 4.7, Borrower shall (i) prepay the Loans in an aggregate principal amount equal to such Borrowing Base Deficiency, and (ii) if a Borrowing Base Deficiency remains after prepaying all of the Loans as a result of Letter of Credit Exposure, deposit with Administrative Agent on behalf of the Banks an amount equal to such Borrowing Base Deficiency to be held as cash collateral to the extent required pursuant to Section 2.1(b); provided that the Borrowing Base Deficiency must be eliminated on or prior to the Termination Date. Notwithstanding the foregoing, if an Event of Default exists on the date of the incurrence or issuance of the Permitted Additional Debt, then, unless Required Banks and Borrower agrees otherwise, all proceeds from any such Permitted Additional Debt shall be applied as a mandatory prepayment on the Loans in accordance with Section 3.2(c).
(c)Upon any termination or reduction of the Aggregate Maximum Credit Amount pursuant to Section 2.9 or any reduction in the Aggregate Elected Commitment Amount pursuant to Section 2.15(f) that results in the Outstanding Revolving Credit exceeding the Total Commitment, on the effective date of any such termination or reduction, Borrower shall prepay the Loans (together with accrued interest thereon) in an amount sufficient to cause the Outstanding Revolving Credit to be equal to or less than the Total Commitment as thereby reduced (and Administrative Agent shall distribute to each Bank in like funds that portion of any such payment as is required to cause the principal balance of the Loans held by such Bank to be not greater than its Commitment as thereby reduced), and any such payment shall be accompanied by amounts due under Section 3.3).
Section 2.7 Voluntary Prepayments. Borrower may, subject to Section 3.3 and the other provisions of this Agreement, upon (a) same-Business Day advance notice (no later than 11:00
a.m. (Central time)) to Administrative Agent with respect to Adjusted Base Rate Borrowings, and
(b)three (3) Business Days advance notice (no later than 11:00 a.m. (Central time)) to Administrative Agent with respect to Eurodollar Borrowings, prepay the principal of the Loans in whole or in part. Any partial prepayment shall be in a minimum amount of $100,000 and shall be in an integral multiple of $100,000.
Section 2.8 Mandatory Termination of Commitments; Termination Date and Maturity. The Total Commitment (and the Commitment of each Bank) shall terminate on the Termination Date. The outstanding principal balance of the Loans, all accrued but unpaid interest thereon, and all other Obligations shall be due and payable in full on the Termination Date.
Section 2.9 Optional Termination and Voluntary Reduction of Aggregate Maximum Credit Amount. Borrower may, by notice to Administrative Agent three (3) Business Days prior to the effective date of any such termination or reduction, terminate or permanently reduce the Aggregate Maximum Credit Amount; provided that (i) any reduction shall be in amounts not less than $500,000 or any larger multiple of $500,000 (or shall be in an amount equal to the entire Aggregate Maximum
Credit Amount) and (ii) upon any reduction of the Aggregate Maximum Credit Amount that would otherwise result in the Aggregate Maximum Credit Amount being less
than the Aggregate Elected Commitment Amount, the Aggregate Elected Commitment Amount shall be automatically reduced (ratably among all Banks in accordance with each Bank’s Applicable Percentage) so that it equals the Aggregate Maximum Credit Amount as so reduced. Notwithstanding the foregoing, Borrower shall not be permitted to voluntarily reduce the Aggregate Maximum Credit Amount to an amount less than the aggregate Letter of Credit Exposure of all Banks.
Section 2.10 Application of Payments. Each repayment pursuant to Section 2.6, Section 2.7, Section 2.8, Section 2.9 and Section 4.4 shall be made together with accrued interest to the date of payment, and shall be applied to payment of the Loans in accordance with Section 3.2 and the other provisions of this Agreement.
Section 2.11 Commitment Fee. On the Termination Date, and on the last day of each Fiscal Quarter prior to the Termination Date, and in the event the Commitments are terminated in their entirety prior to the Termination Date, on the date of such termination, commencing with the last day of the Fiscal Quarter ending on June 30, 2019, Borrower shall pay to Administrative Agent, for the ratable benefit of each Bank based on each Bank’s Applicable Percentage, a commitment fee equal to the Commitment Fee Percentage (computed on the basis of actual days elapsed and as if each calendar year consisted of 360 days) of the average daily Revolving Availability for the Fiscal Quarter (or portion thereof) then ended; provided that, the aforementioned commitment fee shall cease to accrue on the unfunded portion of the Commitment of any Defaulting Bank.
Section 2.12 Letter of Credit Fees and Letter of Credit Fronting Fees. On the Termination Date, and on the last day of each Fiscal Quarter prior to the Termination Date, commencing with the last day of the Fiscal Quarter ending on June 30, 2019, and, in the event the Commitments are terminated in their entirety prior to the Termination Date, on the date of such termination, Borrower shall pay to Administrative Agent (to be distributed by Administrative Agent in accordance with Section 2.1(b)) (a) the Letter of Credit Fee which accrued during such Fiscal Quarter (or portion thereof) and (b) the Letter of Credit Fronting Fee which accrued during such Fiscal Quarter (or portion thereof), in each case computed on the basis of actual days elapsed and as if each calendar year consisted of 360 days.
Section 2.13 Agency and Other Fees. Borrower shall pay (a) to the Arranger, Xxxxx Fargo Bank, N.A. and their Affiliates such fees and other amounts as Borrower shall be required to pay to such Persons from time to time pursuant to any Fee Letter and (b) to Banks such fees as shall have been separately agreed upon in writing in the amounts and at the times so specified.
Section 2.14 Reliance on Notices. Administrative Agent shall be entitled to rely upon, and shall be fully protected in relying upon, any Request for Borrowing, Rollover Notice, Request for Letter of Credit or similar notice executed and delivered by Borrower and believed by Administrative Agent to be genuine. Administrative Agent may assume that each Person executing and delivering any notice in accordance herewith was duly authorized, unless the responsible individual acting thereon for Administrative Agent has actual knowledge to the contrary.
Section 2.15 Increases, Reductions and Terminations of Aggregate Elected Commitment Amount.
(a) Subject to the conditions set forth in Section 2.15(b), Borrower may increase the Aggregate Elected Commitment Amount then in effect by increasing the Elected Commitment of a Bank or by causing a Person that is acceptable to Administrative Agent that at such time is not a Bank to become a Bank (any such Person that is not at such time a Bank and becomes a Bank, an “Additional Bank”). Notwithstanding anything to the contrary contained in this Agreement, in no case shall an Additional Bank be Parent, Borrower, an Affiliate of Borrower or a natural person.
(b) Any increase in the Aggregate Elected Commitment Amount shall be subject to the following additional conditions:
(i) such increase shall not be less than $10,000,000 (or, in the event such increase would otherwise exceed the Aggregate Maximum Credit Amount, such lesser amount that would constitute the Aggregate Elected Commitment Amount being equal to the Aggregate Maximum Credit Amount) unless Administrative Agent otherwise consents, and no such increase shall be permitted if after giving effect thereto the Aggregate Elected Commitment Amount exceed the Borrowing Base then in effect;
(ii) following any Periodic Determination, Borrower may not increase the Aggregate Elected Commitment Amount more than once before the next Periodic Determination (for the sake of clarity, all increases in the Aggregate Elected Commitment Amount effective on a single date shall be deemed a single increase in the Aggregate Elected Commitment Amounts for purposes of this Section 2.15(b)(ii));
(iii) | no Default shall have occurred and be continuing on the effective |
date of such increase;
(iv) | on the effective date of such increase, no Eurodollar Borrowings |
shall be outstanding or if any Eurodollar Borrowings are outstanding, then the effective date of such increase shall be the last day of the Interest Period in respect of such Eurodollar Borrowings unless Borrower pays any compensation required by Section 3.3;
(v) | no Bank’s Elected Commitment may be increased without the |
consent of such Bank;
(vi) | if Borrower elects to increase the Aggregate Elected Commitment |
Amount by increasing the Elected Commitment of an existing Bank, Borrower and such Bank shall execute and deliver to Administrative Agent a certificate substantially in the form of Exhibit J (an “Elected Commitment Increase Certificate”); and
(vii) if Borrower elects to increase the Aggregate Elected Commitment Amount by causing an Additional Bank to become a party to this Agreement, then Borrower and such Additional Bank shall execute and deliver to Administrative Agent a certificate substantially in the form of Exhibit K (an “Additional Bank Certificate”), together with an Administrative
Questionnaire and a processing and recordation fee of $3,500, and Borrower shall (1) if requested by Additional Bank, deliver a Note payable to such Additional Bank in a principal amount equal to its Maximum Credit Amount, and otherwise duly completed and (2) pay any applicable fees as may have been agreed to between Borrower and the Additional Bank, and, to the extent applicable and agreed to by Borrower, Administrative Agent.
(c) Subject to acceptance and recording thereof pursuant to Section 2.15(d), from and after the effective date specified in the Elected Commitment Increase Certificate or the Additional Bank Certificate (or if any Eurodollar Borrowings are outstanding, then the last day of the Interest Period in respect of such Eurodollar Borrowings, unless Borrower has paid any compensation required by Section 3.3): (i) the amount of the Aggregate Elected Commitment Amount shall be increased as set forth therein, and (ii) in the case of an Additional Bank Certificate, any Additional Bank party thereto shall be a party to this Agreement and have the rights and obligations of a Bank under this Agreement and the other Loan Papers. In addition, the increasing Bank or the Additional Bank, as applicable, shall purchase a pro rata portion of the outstanding Loans (and participation interests in Letters of Credit) of each of the other Banks (and such Banks hereby agree to sell and to take all such further action to effectuate such sale) such that each Bank (including any Additional Bank, if applicable) shall hold its Applicable Percentage of the outstanding Loans (and participation interests) after giving effect to the increase in the Aggregate Elected Commitment Amount (and the resulting modifications of each Bank’s Maximum Credit Amount pursuant to Section 2.15(e)).
(d) Upon its receipt of a duly completed Elected Commitment Increase Certificate or an Additional Bank Certificate, executed by Borrower and the increasing Bank or by Borrower and the Additional Bank party thereto, as applicable, the processing and recording fee referred to in Section 2.15(b)(vii), the Administrative Questionnaire referred to in Section 2.15(b)(vii) and the break-funding payments from Borrower, if any, required by Section 3.3, if applicable, Administrative Agent shall accept such Elected Commitment Increase Certificate or Additional Bank Certificate and record the information contained therein in the Register required to be maintained by Administrative Agent pursuant to Section 14.8(d). No increase in the Aggregate Elected Commitment Amount shall be effective for purposes of this Agreement unless it has been recorded in the Register as provided in this Section 2.15(d).
(e) Upon any increase in the Aggregate Elected Commitment Amount pursuant to this Section 2.15, (i) each Bank’s Maximum Credit Amount shall be automatically deemed amended to the extent necessary so that each such Bank’s Applicable Percentage equals the percentage of the Aggregate Elected Commitment Amount represented by such Bank’s Elected Commitment, in each case after giving effect to such increase, and (ii) Schedule 1 to this Agreement shall be deemed amended to reflect the Elected Commitment of each Bank (including any Additional Bank) as thereby increased, any changes in the Banks’ Maximum Credit Amounts pursuant to the foregoing clause (i), and any resulting changes in the Banks’ Applicable Percentages.
(f) Borrower may from time to time terminate or reduce the Aggregate Elected Commitment Amount; provided that (i) each reduction of the Aggregate Elected Commitment Amount shall be in an amount that is an integral multiple of $500,000 and not less than $1,000,000 and (B) Borrower shall not reduce the Aggregate Elected Commitment Amount if, after giving
effect to any concurrent prepayment of the Loans in accordance with Section 2.6(c), the Outstanding Revolving Credit would exceed the Aggregate Elected Commitment Amount as reduced.
(g) Borrower shall notify Administrative Agent of any election to terminate or reduce the Aggregate Elected Commitment Amount under Section 2.15(f) at least three Business Days prior to the effective date of such termination or reduction, specifying such election and the effective date thereof. Promptly following receipt of any notice, Administrative Agent shall advise the Banks of the contents thereof. Each notice delivered by Borrower pursuant to this Section 2.15(g) shall be irrevocable. Any termination or reduction of the Aggregate Elected Commitment Amount shall be permanent and may not be reinstated, except pursuant to Section 2.15(a). Each reduction of the Aggregate Elected Commitment Amount shall be made ratably among the Banks in accordance with each Bank’s Applicable Percentage.
(h) Upon any redetermination or other adjustment in the Borrowing Base pursuant to this Agreement that would otherwise result in the Borrowing Base becoming less than the Aggregate Elected Commitment Amount, the Aggregate Elected Commitment Amount shall be automatically reduced (ratably among the Banks in accordance with each Bank’s Applicable Percentage) so that they equal such redetermined Borrowing Base (and Schedule 1 of this Agreement shall be deemed amended to reflect such amendments to each Bank’s Elected Commitment and the Aggregate Elected Commitment Amount).
(i) Contemporaneously with any increase in the Borrowing Base pursuant to this Agreement, if (i) Borrower elects to increase the Aggregate Elected Commitment Amount and
(ii)each Bank has consented to such increase in its Elected Commitment, then the Aggregate Elected Commitment Amount shall be increased (ratably among the Banks in accordance with each Bank’s Applicable Percentage) by the amount requested by Borrower (subject to the limitations set forth in Section 2.15(b)(i)) without the requirement that any Bank deliver an Elected Commitment Increase Certificate or that Borrower pay any amounts under Section 3.3, and Schedule 1 of this Agreement shall be deemed amended to reflect such amendments to each Bank’s Elected Commitment and the Aggregate Elected Commitment Amount. Administrative Agent shall record the information regarding such increases in the Register required to be maintained by Administrative Agent pursuant to Section 14.8(d).
ARTICLE III GENERAL PROVISIONS
Section 3.1 Delivery and Endorsement of Notes. Simultaneously with the execution of this Agreement and in accordance with Section 2.4, Administrative Agent shall deliver to each Bank the Note, if any, payable to such Bank. Each Bank may record (and prior to any transfer of its Note shall record) on the schedule attached to its Note appropriate notations to evidence the date and amount of each advance of funds made by it in respect of any Borrowing, the Interest Period (if any) applicable thereto, and the date and amount of each payment of principal received by such Bank with respect to the Loans; provided that the failure by any Bank to so record its Note shall not affect the liability of Borrower for the repayment of all amounts outstanding under such Notes together with interest thereon. Each Bank is hereby irrevocably authorized by Borrower to
record such notations on its Note and to attach to and make a part of any Note a continuation of any such schedule as required.
Section 3.2 General Provisions as to Payments.
(a) Borrower shall make each payment of principal of, and interest on, the Loans and all fees payable by Borrower hereunder not later than 11:00 a.m. (Central time) on the date when due, in funds immediately available to Administrative Agent at its address set forth on Schedule 1 hereto. Administrative Agent will promptly (and if such payment is received by Administrative Agent by noon (Central time), and otherwise if reasonably possible, on the same Business Day) distribute to each Bank its Applicable Percentage of each such payment received by Administrative Agent for the account of Banks. Whenever any payment of principal of, or interest on, that portion of the Loans subject to an Adjusted Base Rate Tranche or of fees shall be due on a day which is not a Business Day, the date for payment thereof shall be extended to the next succeeding Business Day (subject to the definition of Interest Period). Whenever any payment of principal of, or interest on, that portion of the Loans subject to a Eurodollar Tranche shall be due on a day which is not a Eurodollar Business Day, the date for payment thereof shall be extended to the next succeeding Eurodollar Business Day (subject to the definition of Interest Period). If the date for any payment of principal is extended by operation of Law or otherwise, interest thereon shall be payable for such extended time. Borrower hereby authorizes Administrative Agent to charge from time to time against Borrower’s account or accounts with Administrative Agent any amount then due by Borrower. All amounts payable by Borrower under the Loan Papers (whether principal, interest, fees, expenses, or otherwise) shall be paid in full, without set-off or counterclaim.
(b) Prior to the occurrence of an Event of Default, all principal payments received by Banks with respect to the Loans shall be applied as instructed by Borrower and, in the absence of such instructions, first to Eurodollar Tranches outstanding under the Loans with Interest Periods ending on the date of such payment, then to Adjusted Base Rate Tranches, then to Eurodollar Tranches outstanding under the Loans next maturing, and then to Eurodollar Tranches outstanding under the Loans next maturing until all such Eurodollar Tranches are repaid until such principal payment is fully applied, with such adjustments in such order of payment as Administrative Agent shall specify in order that each Bank receives its ratable share of each such payment.
(c) During the continuation of an Event of Default, all amounts collected or received by Administrative Agent or any Bank from any Credit Party or in respect of any of the assets of any Credit Party shall be applied in the following order:
(i) first, to the payment of all fees, indemnities, expenses and other amounts payable to Administrative Agent (including fees, expenses, and disbursements of counsel to Administrative Agent);
(ii) second, to the payment of all fees, indemnities, expenses and other amounts (other than principal, interest, and Letter of Credit Fees) payable to Banks under the Loan Papers (including fees, expenses, and disbursements of counsel to Banks), ratably among them in proportion to the respective amounts described in this clause second payable to them;
(iii) third, to the reimbursement of any advances made by Administrative Agent or Banks as authorized hereunder to effect performance of any unperformed covenants of any Credit Party under any of the Loan Papers;
(iv) fourth, to payment of that portion of the Obligations constituting (A) accrued and unpaid Letter of Credit Fees and interest on the Loans and other Obligations, (B) unpaid principal of the Loans in the order specified in Section 3.2(b), (C) any amounts funded but unreimbursed under Letters of Credit, (D) amounts owing under Hedge Agreements (to the extent such amounts are Obligations), and (E) amounts owing under Bank Products (to the extent such amounts are Obligations), ratably among the Banks, the Letter of Credit Issuer, the Secured Hedge Providers and the Bank Products Providers in proportion to the respective amounts described in this clause fourth payable to them;
(v) | fifth, pro rata to any other Obligations; |
(vi) | sixth, to establish the deposits required by Section 2.1(b) if any; and |
(vii) last, the balance, if any, after all of the Obligations have been indefeasibly paid in full, to Borrower or as otherwise required by Law.
All payments received by a Bank during the continuation of an Event of Default for application to the principal of the Loans pursuant to this Section 3.2(c) shall be applied by such Bank in the manner provided in Section 3.2(b).
Notwithstanding the foregoing, amounts received from any Guarantor that is not an Eligible Contract Participant shall not be applied to any Obligations that are Excluded Swap Obligations with respect to such Guarantor (it being understood, that in the event that any amount is applied to Obligations other than Excluded Swap Obligations as a result of this clause, Administrative Agent shall make such adjustments as it determines are appropriate to distributions pursuant to clause fourth above from amounts received from Eligible Contract Participants to ensure, as nearly as possible, that the proportional aggregate recoveries with respect to Obligations described in clause fourth above by the holders of any Excluded Swap Obligations are the same as the proportional aggregate recoveries with respect to other Obligations pursuant to clause fourth above).
Section 3.3 Funding Losses. If Borrower makes or is deemed to make any payment of principal subject to a Eurodollar Tranche (whether pursuant to Section 2.6, Section 2.7, Section 2.8, Section 2.9, Section 4.4, Article XI or Article XIII, whether as a voluntary or mandatory prepayment or otherwise) on any day other than the last day of an Interest Period applicable thereto, or if Borrower fails to borrow any Eurodollar Borrowing, after notice has been given to any Bank in accordance with Section 2.2, Borrower shall reimburse each Bank on demand for any resulting loss or expense incurred by it, including any loss incurred in obtaining, liquidating or employing deposits from third parties, or any loss arising from the reemployment of funds at rates lower than the cost to such Bank of such funds and related costs, which in the case of the payment or prepayment prior to the end of the Interest Period for any Eurodollar Tranche, shall include the amount, if any, by which (a) the interest which such Bank would have received for such Loan absent such payment or prepayment for the applicable Interest Period at the applicable Adjusted LIBOR Rate, but excluding the Applicable Margin, exceeds (b) the interest which such Bank
would receive if its Applicable Percentage of the amount of such Eurodollar Borrowing were deposited, loaned, or placed by such Bank in the interbank eurodollar market on the date of such payment or prepayment for the remainder of the applicable Interest Period. Such Bank shall promptly deliver to Borrower and Administrative Agent a certificate as to the amount of such loss or expense, which certificate shall be conclusive in the absence of manifest error.
Section 3.4 Non-Receipt of Funds by Administrative Agent. Unless Administrative Agent shall have been notified by a Bank or Borrower (as used in this Section, “Payor”) prior to the date on which such Bank is to make payment to Administrative Agent hereunder or Borrower is to make a payment to Administrative Agent for the account of one or more Banks, as the case may be (as used in this Section, such payment being herein called the “Required Payment”), which notice shall be effective upon receipt, that Payor does not intend to make the Required Payment to Administrative Agent, Administrative Agent may assume that the Required Payment has been made and may, in reliance upon such assumption (but shall not be required to), make the amount thereof available to the intended recipient on such date and, if Payor has not in fact made the Required Payment to Administrative Agent, (a) the recipient of such payment shall, on demand, pay to Administrative Agent the amount made available to it together with interest thereon in respect of the period commencing on the date such amount was so made available by Administrative Agent until the date Administrative Agent recovers such amount at a rate per annum equal to the Adjusted Base Rate then in effect for such period, and (b) Administrative Agent shall be entitled to offset against any and all sums to be paid to such recipient, the amount calculated in accordance with the foregoing clause (a).
Section 3.5 Defaulting Banks.
(a)Notwithstanding anything to the contrary contained herein, the Maximum Credit Amount of a Defaulting Bank shall not be included in determining whether all Banks, the Majority Banks, the Required Banks or the Super Majority Banks have taken or may take any action hereunder (including approval of any redetermination of the Borrowing Base pursuant to Article IV and any consent to any amendment or waiver pursuant to Section 14.2); provided that, any waiver, amendment or modification requiring the consent of all Banks or each affected Bank which affects such Defaulting Bank differently than other affected Banks shall require the consent of such Defaulting Bank; and provided further that in no event shall (i) the Commitment, Elected Commitment or Maximum Credit Amount of any Defaulting Bank be increased without the consent of such Defaulting Bank, or (ii) the Termination Date or any date fixed for any payment of interest on the Loans or any fees hereunder be postponed without the consent of such Defaulting Bank.
(b)If any Bank shall fail to make any payment referenced in clause (a) of the definition of “Defaulting Bank”, then Administrative Agent may, in its discretion and notwithstanding any contrary provision hereof, (i) apply any amounts thereafter received by Administrative Agent for the account of such Bank and for the benefit of Administrative Agent or the Letter of Credit Issuer to satisfy such Bank’s obligations hereunder until all such unsatisfied obligations are fully paid, and/or (ii) hold any such amounts in a segregated account as cash collateral for, and application to, any future funding obligations of such Bank hereunder; in the case of each of (i) and (ii) above, in any order as determined by Administrative Agent in its discretion.
(c)Borrower shall not be obligated to pay any Defaulting Bank's ratable share of the fees described in Section 2.11, Section 2.12 or Section 2.13 (notwithstanding anything to the contrary in such sections) for the period commencing on the day such Defaulting Bank becomes a Defaulting Bank and continuing for so long as such Bank continues to be a Defaulting Bank.
ARTICLE IV BORROWING BASE
Section 4.1 Reserve Reports; Proposed Borrowing Base. As soon as available and in any event by (a) June 30, 2019, September 30, 2019 and December 31, 2019, and (b) each March 31 and September 30 of each year thereafter, Borrower shall deliver to each Bank a Reserve Report prepared (i) in the case of the Reserve Reports required to be delivered on the dates in the foregoing clause (a), as of the immediately preceding March 31, 2019, June 30, 2019 and September 30, 2019, respectively, and (ii) in the case of the Reserve Reports required to be delivered on the dates in the foregoing clause (b), as of the immediately preceding December 31 and June 30, respectively. Simultaneously with the delivery to Administrative Agent and each Bank of each Reserve Report, Borrower shall notify Administrative Agent of the Borrowing Base which Borrower requested become effective for the period commencing on the next Determination Date.
Section 4.2 Periodic Determinations of the Borrowing Base; Procedures and Standards. Based in part on the Reserve Report made available to Banks pursuant to Section 4.1, Banks shall redetermine the Borrowing Base on or prior to the next Determination Date or such date promptly thereafter as reasonably possible (i) based on the engineering and other information available to Banks, and (ii) in accordance with, and consistent with, the subsequent provisions of this Section
4.2. Any Borrowing Base which becomes effective as a result of any Determination of the Borrowing Base shall be subject to the following restrictions: (A) such Borrowing Base shall not exceed the Borrowing Base requested by Borrower pursuant to Section 4.1 or Section 4.3 (as applicable), (B) such Borrowing Base shall not exceed the Aggregate Maximum Credit Amount then in effect, (C) to the extent such Borrowing Base represents an increase from the Borrowing Base in effect prior to such Determination such Borrowing Base shall be approved by all Banks, and (D) any Borrowing Base which represents a decrease in the Borrowing Base in effect prior to such Determination, or a reaffirmation of such prior Borrowing Base, shall require approval of Required Banks. Administrative Agent shall propose such redetermined Borrowing Base to Banks within fifteen (15) days following receipt by the Banks of a Reserve Report (or such date promptly thereafter as reasonably practicable). After having received notice of such proposal by Administrative Agent, Required Banks (or all Banks in the event of a proposed increase) shall have fifteen (15) days to agree or disagree with such proposal. If, in the case of any proposed Borrowing Base that would decrease or maintain the Borrowing Base then in effect, at the end of such 15-day period, any Bank has not communicated its approval or disapproval, such silence shall be deemed an approval. If, in the case of any proposed Borrowing Base that would increase the Borrowing Base then in effect, at the end of such 15-day period, any Bank has not communicated its approval or disapproval, such silence shall be deemed disapproval. If sufficient Banks notify Administrative Agent within such 15-day period of their disapproval such that Required Banks have neither approved nor been deemed to approve such Borrowing Base as herein provided (or, in the event of a proposed increase, any Bank notifies Administrative Agent within such 15-day
period of its disapproval), Required Banks (or all Banks in the event of a proposed increase) shall, within a reasonable period of time, agree on a new Borrowing Base.
In taking the above actions, Administrative Agent and the Banks shall act in their sole discretion. It is further acknowledged and agreed that each Bank may consider such other credit factors as it deems appropriate and shall have no obligation in connection with any Determination to approve any change in the Borrowing Base in effect prior to such Determination. Promptly following any Determination of the Borrowing Base, Administrative Agent shall notify Borrower of the amount of the Borrowing Base as redetermined, which Borrowing Base shall be effective as of the date specified in such notice, and shall remain in effect for all purposes of this Agreement until the next Determination.
Section 4.3 Special Determination of Borrowing Base. In addition to the redetermination of the Borrowing Base pursuant to Section 4.2, and adjustments of the Borrowing Base pursuant to Section 4.6, Section 4.7 and Section 5.2, Borrower and Required Banks may each request one Special Determination of the Borrowing Base in any Fiscal Year. In addition, Borrower may request Special Determinations from time to time as significant acquisition opportunities are presented to Borrower or for significant development and exploration of Borrower’s and its Restricted Subsidiaries’ Mineral Interests. In the event Required Banks request such a Special Determination, Administrative Agent shall promptly deliver notice of such request to Borrower and Borrower shall, within 20 days following the date of such request, deliver to Banks (i) a Reserve Report prepared as of the last day of the calendar month preceding the date of such request and (ii) such other reports, data and supplemental information as may be reasonably requested by the Required Banks. In the event Borrower requests a Special Determination, Borrower shall deliver written notice of such request to Banks which shall include (A) a Reserve Report prepared as of a date not more than 30 days prior to the date of such request, (B) such other reports, data and supplemental information as may be reasonably requested by the Required Banks and (C) the amount of the Borrowing Base requested by Borrower and to become effective on the Determination Date applicable to such Special Determination. Upon receipt of such Reserve Report, Administrative Agent shall, subject to approval of Required Banks, or all Banks in the event of a proposed increase in the Borrowing Base, redetermine the Borrowing Base in accordance with the procedure set forth in Section 4.2 which Borrowing Base shall become effective on the Determination Date applicable to such Special Determination (or as soon thereafter as Administrative Agent and Required Banks, or all Banks in the event of a proposed increase in the Borrowing Base, approve such Borrowing Base and provide notice thereof to Borrower).
Section 4.4 Borrowing Base Deficiency. If a Borrowing Base Deficiency exists at any time (other than as a result of any reduction of the Borrowing Base pursuant to Section 4.6 or Section 4.7), Borrower shall, within 30 days following notice thereof from Administrative Agent, provide written notice (the “Election Notice”) to Administrative Agent stating the action which Borrower proposes to take to remedy such Borrowing Base Deficiency, and Borrower shall thereafter, at its option, do one or a combination of the following: (a) within 45 days following the delivery of such Election Notice, make a prepayment of principal on the Loans in an amount sufficient to eliminate 50% of such Borrowing Base Deficiency, with a payment or payments to eliminate the remainder of such Borrowing Base Deficiency due within 90 days following the delivery of such Election
Notice, and if such Borrowing Base Deficiency cannot be eliminated by prepaying the Loans in full (as a result of outstanding Letter of Credit Exposure), Borrower shall
also at such time or times deposit with Administrative Agent sufficient funds to be held by Administrative Agent as security for outstanding Letter of Credit Exposure in the manner contemplated by Section 2.1(b) as necessary to eliminate the required portions of such Borrowing Base Deficiency on the dates required therefor, (b) within 90 days following the delivery of such Election Notice, submit additional oil and gas properties owned by Borrower and its Restricted Subsidiaries for consideration in connection with the determination of the Borrowing Base which Administrative Agent and Required Banks deem sufficient in their sole discretion to eliminate such Borrowing Base Deficiency, or (c) eliminate such deficiency by making six consecutive mandatory prepayments of principal on the Loans, each of which shall be in the amount of one sixth of the amount of such Borrowing Base Deficiency, commencing on the date that is 30 days after notice of such Borrowing Base Deficiency is delivered to Borrower and continuing thereafter on each monthly anniversary of such first payment, and in connection therewith, Borrower shall dedicate a sufficient amount (as determined by Administrative Agent) of the monthly cash flow from Borrower’s and the Restricted Subsidiaries’ Mineral Interests to satisfy such payments.
Section 4.5 Initial Borrowing Base. The Borrowing Base in effect during the period from the Effective Date until the date of the first Special Determination, Periodic Determination or other adjustment to the Borrowing Base hereunder after the Effective Date shall be the Initial Borrowing Base.
Section 4.6 Automatic Adjustment – Asset Disposition. In addition to the redeterminations of the Borrowing Base pursuant to Section 4.2 and Section 4.3, and adjustments of the Borrowing Base pursuant to Section 4.7 and Section 5.2, simultaneously with the completion by any Credit Party of any Asset Disposition pursuant to Section 9.5 of the Borrowing Base Properties and/or Borrowing Base Xxxxxx which, when aggregated with the Borrowing Base Properties and/or Borrowing Base Xxxxxx subject to all other Asset Dispositions since the Determination Date of the Borrowing Base then in effect, have a fair market value in excess of 5% of the Borrowing Base then in effect, the Borrowing Base shall be automatically reduced as set forth in this Section 4.6; provided, that, for purposes of this Section 4.6, a termination or other monetization, in whole or in part, of an Oil and Gas Hedge Transaction shall be deemed not to be an “Asset Disposition” to the extent that (x) such Oil and Gas Hedge Transaction is novated, in whole or in part, from the existing counterparty to another counterparty, with Borrower or another Credit Party being the “remaining party” for purposes of such novation, or (y) upon its termination, in whole or in part, it is replaced, in a substantially contemporaneous transaction, with one or more Oil and Gas Hedge Transactions covering Hydrocarbons of the type that were hedged pursuant to such replaced Oil and Gas Hedge Transaction with notional volumes, prices and tenors not less favorable to Borrower or such Credit Party as those set forth in such replaced Oil and Gas Hedge Transaction, and without cash payments to any Credit Party in connection therewith (except to the extent that such cash payments are paid to the counterparties on such replacement transactions upon the relevant Credit Party entering into such replacement transactions). Such reduction shall be in an amount equal to the sum of (a) the value, if any, assigned to such Borrowing Base Properties and/or Borrowing Base Xxxxxx (to the extent so terminated and not so replaced) subject to such Asset Disposition in the Borrowing Base then in effect (such value as determined by Administrative Agent (and approved by Required Banks) in good faith and consistent with the manner of determination of such Borrowing Base pursuant to Section 4.2 and taking into consideration any negative Borrowing Base value attributed to any out-
of-the money Borrowing Base Xxxxxx so terminated), and (b) the reduction in the Borrowing Base value realized or
resulting from any such replacement of Borrowing Base Xxxxxx (such value as determined by Administrative Agent (and approved by Required Banks) in good faith and consistent with the manner of determination of such Borrowing Base pursuant to Section 4.2 and taking into consideration any negative Borrowing Base value attributed to any out-of-the-money Borrowing Base Xxxxxx so replaced). Notwithstanding Section 4.4, upon any reduction of the Borrowing Base pursuant to this Section 4.6 which results in a Borrowing Base Deficiency (or increase in any existing Borrowing Base Deficiency), Borrower shall prepay the Loans and/or cash collateralize the Letter of Credit Exposure in accordance with Section 2.6(a). For the sake of clarity, the termination or other monetization of a Borrowing Base Hedge at its scheduled maturity does not constitute an Asset Disposition and notwithstanding anything to the contrary in this Section 4.6, the termination or monetization of a Borrowing Base Hedge at its scheduled maturity shall not result in any reduction of the Borrowing Base.
Section 4.7 Automatic Adjustment – Issuance of Permitted Additional Debt. In addition to the redeterminations of the Borrowing Base pursuant to Section 4.2 and Section 4.3, and adjustments of the Borrowing Base pursuant to Section 4.6 and Section 5.2, upon any incurrence or issuance of any Permitted Additional Debt, the Borrowing Base then in effect shall automatically be decreased by an amount equal to 25% of the aggregate stated principal amount of such Permitted Additional Debt incurred or issued at such time. Such decrease in the Borrowing Base shall occur automatically upon the incurrence or issuance of such Permitted Additional Debt on the date of incurrence or issuance, without any vote of the Banks or action by Administrative Agent and shall be effective and applicable to Borrower, Administrative Agent, the Letter of Credit Issuer and the Banks on such date until the next redetermination or other adjustment of the Borrowing Base pursuant to this Agreement; provided, that, no such reduction of the Borrowing Base shall occur with respect to any Permitted Additional Debt incurred or issued to substantially simultaneously refinance or replace any then existing Permitted Additional Debt (up to the principal amount of such refinanced or replaced Permitted Additional Debt). Upon any such reduction in the Borrowing Base, Administrative Agent shall promptly deliver notice thereof to Borrower and the Banks. Notwithstanding Section 4.4, upon any reduction of the Borrowing Base pursuant to this Section 4.7 which results in a Borrowing Base Deficiency (or increase in any existing Borrowing Base Deficiency), Borrower shall prepay the Loans and/or cash collateralize the Letter of Credit Exposure in accordance with Section 2.6(b).
ARTICLE V COLLATERAL AND GUARANTIES
Section 5.1 Security.
(a) On and after the Effective Date, the Obligations shall be secured by first and prior Liens covering and encumbering (i) one hundred percent (100%) of the issued and outstanding Equity Interests of each existing and future Domestic Subsidiary of Borrower that are owned by a Credit Party, (ii) Proved Mineral Interests owned by Borrower and its Restricted Subsidiaries that constitute not less than the Required Reserve Value of all Proved Mineral Interests owned by Borrower and its Restricted Subsidiaries and (iii) substantially all of the other material personal property assets of the Credit Parties (subject to certain exceptions as set forth in the Security
Instruments), except that, in each case, Permitted Encumbrances may exist. On or before the Effective Date, Borrower shall deliver, or cause to be delivered, to Administrative
Agent, for the ratable benefit of each Bank, the Security Agreement and Mortgages in form and substance acceptable to Administrative Agent and duly executed by such Credit Party, together with such other assignments, conveyances, amendments, agreements and other writings, including UCC-1 financing statements (each duly authorized and, as applicable, executed) as Administrative Agent shall deem necessary or appropriate to grant, evidence and perfect first and prior Liens in all Borrowing Base Properties and other interests of Borrower and the other Credit Parties as required by this Section 5.1(a). Borrower hereby authorizes Administrative Agent, and its agents, successors and assigns, to file any and all necessary financing statements under the Uniform Commercial Code, assignments and/or continuation statements as necessary from time to time (in Administrative Agent’s discretion) to perfect (or continue perfection of) the Liens granted pursuant to the Loan Papers.
(b) On or before each Determination Date after the Effective Date, and at such other times as Administrative Agent or Required Banks shall reasonably request, Borrower shall, and shall cause its Restricted Subsidiaries to, deliver to Administrative Agent, for the ratable benefit of each Bank, Mortgages in form and substance acceptable to Administrative Agent and duly executed by Borrower and such Restricted Subsidiaries (as applicable) together with such other assignments, conveyances, amendments, agreements and other writings, including UCC-1 financing statements (each duly authorized and, as applicable, executed) as Administrative Agent shall reasonably deem necessary or appropriate to grant, evidence and perfect the Liens required by Section 5.1(a) above with respect to Proved Mineral Interests then held by Borrower and such Restricted Subsidiaries (as applicable) which are not the subject of existing first and prior, perfected Liens securing the Obligations as required by Section 5.1(a). Borrower and its Restricted Subsidiaries are not required to grant Liens on Mineral Interests other than their Proved Mineral Interests.
(c) Borrower will at all times cause the other material tangible and intangible personal property of Borrower and each Restricted Subsidiary (to the extent purported to be subject to the Security Agreement) to be subject to the Lien of the Security Agreement including all Hedge Agreements and Hedge Transactions entered into by Borrower and each Restricted Subsidiary and all Equity Interests owned by Borrower and each Restricted Subsidiary.
(d) Notwithstanding any provision in any of the Loan Papers to the contrary, in no event is any Building (as defined in the applicable Flood Insurance Regulations) or Manufactured (Mobile) Home (as defined in the applicable Flood Insurance Regulations) owned by any Credit Party included in the Mortgaged Property and no Building or Manufactured (Mobile) Home shall be encumbered by any Security Instrument; provided, that (i) the applicable Credit Party’s interests in all lands and Hydrocarbons situated under any such Building or Manufactured (Mobile) Home shall be included in the Mortgaged Property and shall be encumbered by the Security Instruments and (ii) Borrower shall not, and shall not permit any of its Restricted Subsidiaries to, permit to exist any Lien on any Building or Manufactured (Mobile) Home owned by them except Permitted Encumbrances.
(e) Notwithstanding that, by the terms of the various Security Instruments, the Credit Parties are and will be assigning to Administrative Agent for the benefit of the Secured Parties
all of the Hydrocarbon production, products and proceeds accruing to the property covered thereby and are and will be providing to Administrative Agent various control agreements, powers
of attorney and other rights to exercise control over such collateral or any other collateral covered by any of the Security Instruments, so long as no Event of Default has occurred and is continuing the Credit Parties may continue to receive and collect all such proceeds and Administrative Agent will not exercise its rights and remedies under the control agreements, powers of attorney and other rights and remedies to collect or control any of the collateral subject to the Security Instruments, provided that such forbearance by Administrative Agent in not exercising its rights and remedies under the control agreements, powers of attorney and other rights and remedies to collect or control any of such collateral shall not constitute in any way a waiver, remission or release of any of its rights or remedies under the Security Instruments or a release of any Lien granted thereunder.
Section 5.2 Title Information. At any time Borrower or any of its Restricted Subsidiaries are required to execute and deliver Mortgages to Administrative Agent pursuant to Section 5.1, Borrower shall also deliver to Administrative Agent (a) such evidence of title (including but not limited to any title opinions available to Borrower) as Administrative Agent shall reasonably require to verify Borrower’s or any such Restricted Subsidiary’s (as applicable) title to an appropriate portion of Borrower’s and its Restricted Subsidiaries’ Proved Mineral Interests (taking into account their nature as royalty interests or non-operated working interests, as applicable); provided that to the extent the Recognized Value of non-operated working interests owned by Borrower and its Restricted Subsidiaries is greater than or equal to ten percent (10%) Recognized Value of Borrower and its Restricted Subsidiaries’ Proved Minerals Interests, then Borrower or any such Restricted Subsidiary shall deliver such satisfactory evidence of title covering properties comprising not less than 80% of the Recognized Value of all of Borrower’s and its Restricted Subsidiaries’ non-operated working interests, and (b) such opinions of counsel (addressed to Administrative Agent) as Administrative Agent shall reasonably require to address the validity and perfection of the Liens created by such Mortgages. If Borrower fails to provide title information requested under this Section 5.2 within a 90-day period following a request therefor or if Borrower fails to cure any title defect requested by Administrative Agent or the Banks to be cured within a 90-day period following such request, such failure shall not be a Default, but instead Administrative Agent and/or the Required Banks shall have the right to exercise the following remedy in their sole discretion from time to time, and any failure to so exercise this remedy at any time shall not be a waiver as to future exercise of the remedy by Administrative Agent or the Banks. To the extent that Administrative Agent or the Required Banks are not satisfied with title to any Mineral Interest after the 90-day period has elapsed, Administrative Agent may send a notice to Borrower and the Banks that the then outstanding Borrowing Base shall be reduced by an amount reasonably determined by the Required Banks in light of such failure to be in compliance with the title requirement set forth in clause (a) of the first sentence of this Section 5.2. This new Borrowing Base shall become effective immediately after receipt of such notice and any resulting Borrowing Base Deficiency shall be cured in accordance with Section 4.4.
Section 5.3 Guarantees. Payment and performance of the Obligations shall be fully guaranteed by each existing or hereafter acquired or formed Restricted Subsidiary of Borrower, in each case, pursuant to the Facility Guaranty.
Section 5.4 Additional Guarantors. In connection with the acquisition or organization of any new Domestic Subsidiary of Borrower or any designation of an Unrestricted Subsidiary as a Restricted Subsidiary pursuant to Section 9.11, promptly (and in no event more than 30 days or
such later date as Administrative Agent may agree in its sole discretion) following such creation or acquisition, Borrower (a) shall, or shall cause the applicable Restricted Subsidiary, to execute and deliver a joinder to the Facility Guaranty and the Security Agreement executed by such Restricted Subsidiary, (b) shall, or shall cause the holder of the Equity Interests in such Restricted Subsidiary, to pledge all of the Equity Interests of such Restricted Subsidiary (including delivery of any stock certificates evidencing the Equity Interests of such Restricted Subsidiary, together with appropriate undated stock powers for each certificate duly executed in blank by the registered owner thereof), and (c) shall, or shall cause any other Credit Party, to execute and deliver, such other additional UCC-1 financing statements, closing documents, certificates, and legal opinions as shall reasonably be requested by Administrative Agent, in the case of each of clause (a), (b), and (c) above, in form and substance reasonably satisfactory to Administrative Agent. Borrower shall cause any Person (including any Unrestricted Subsidiary) that guarantees the obligations with respect to any Permitted Additional Debt to become a Guarantor (if it is not already a Guarantor) by executing and delivering to Administrative Agent a joinder to the Facility Guaranty.
ARTICLE VI CONDITIONS PRECEDENT
Section 6.1 Conditions to Initial Borrowing and Participation in Letter of Credit Exposure. The obligations of each Bank to loan its Applicable Percentage of the initial Borrowing hereunder, and the obligation of the Letter of Credit Issuer to issue the initial Letter of Credit issued hereunder, is subject to the satisfaction (or waiver in accordance with Section 14.2) of each of the following conditions:
(a)Closing Deliveries. Administrative Agent shall have received each of the following documents, instruments and agreements, each of which shall be in form and substance and executed in such counterparts as shall be acceptable to Administrative Agent and each of which shall, unless otherwise indicated, be dated the Effective Date:
(i) this Agreement, duly executed and delivered by Borrower, each Bank, the Letter of Credit Issuer, and Administrative Agent;
(ii) a Note payable to each Bank requesting a Note in the amount of such Bank’s Maximum Credit Amount, in each case duly executed and delivered by Borrower;
(iii) | the Facility Guaranty, duly executed and delivered by each |
Guarantor;
(iv) | the Security Agreement, duly executed and delivered by Borrower |
and each other Credit Party;
(v) the Mortgages, each duly executed and delivered by the appropriate Credit Party, together with such other assignments, conveyances, amendments, merger and/or name change affidavits, agreements and other writings, including UCC-1 financing statements, as may reasonably be requested by Administrative Agent;
(vi) certificates, together with undated, blank stock powers (or the equivalent for Persons that are not corporations) for each certificate, representing all of the certificated issued and outstanding Equity Interests of each direct or indirect Subsidiary of Borrower owned by a Credit Party;
(vii) copies of the certificate of incorporation or certificate of formation, and all amendments thereto, of each Credit Party accompanied by a certificate that such copy is true, correct and complete issued by the appropriate Governmental Authority of the state of formation for such Credit Party and accompanied by a certificate of the Secretary or comparable Authorized Officer of such Credit Party that such copy is true, correct and complete as of the Effective Date;
(viii) copies of the bylaws or limited liability company agreement, and all amendments thereto, of each Credit Party, accompanied by a certificate of the Secretary or comparable Authorized Officer of each Credit Party that such copy is true, correct and complete as of the Effective Date;
(ix) certain certificates and other documents issued by the appropriate Governmental Authorities of the state of formation and the other states listed on Schedule 3 hereto, as applicable, relating to the existence of each Credit Party and to the effect that such Credit Party is organized or qualified to do business in such jurisdiction is in good standing with respect to the payment of franchise and similar Taxes and is duly qualified to transact business in such jurisdictions;
(x) a certificate of incumbency of all officers of each Credit Party who will be authorized to execute or attest to any Loan Paper, dated the Effective Date, executed by the Secretary or comparable Authorized Officer of such Credit Party;
(xi) copies of resolutions or comparable authorizations and consents approving the Loan Papers and authorizing the transactions contemplated by this Agreement and the other Loan Papers, duly adopted by the Board of Managers (or similar managing body) of each Credit Party, accompanied by certificates of the Secretary or comparable officer of such Credit Party that such copies are true and correct copies of resolutions duly adopted by the Board of Managers (or similar managing body) of each Credit Party, and that such resolutions have not been amended, modified, or revoked in any respect, and are in full force and effect as of the Effective Date;
(xii) such UCC and county level Lien search reports as Administrative Agent shall reasonably require, conducted in such jurisdictions and reflecting such names as Administrative Agent shall reasonably request reflecting no prior Liens encumbering the Properties of Borrower and its Restricted Subsidiaries other than those being assigned or released on or prior to the Effective Date or Permitted Encumbrances;
(xiii) a duly executed payoff letter dated on or prior to the Effective Date with respect to the Owl Rock Credit Agreement and evidence satisfactory to it (including mortgage releases and UCC-3 financing statement terminations) that the Owl Rock Credit Agreement has been repaid in full and the commitments thereunder have been terminated and that the Liens
securing the Owl Rock Credit Agreement have been released, subject only to the filing of applicable terminations and releases (the “Owl Rock Payoff”);
(xiv) to the extent applicable, certificates from the Credit Parties’ insurance providers setting forth the insurance maintained by the Credit Parties, showing that insurance meeting the requirements of Section 8.5 is in full force and effect and that all premiums due with respect thereto have been paid, showing Administrative Agent as loss payee with respect to all such property or casualty policies and as additional insured with respect to all such liability policies, and stating that such insurer will provide Administrative Agent with at least 30 days’ advance notice (or, if less, the maximum notice that such insurer will provide) of cancellation of any such policy;
(xv) an opinion of (A) Xxxxxxxx & Xxxxxx LLP, special counsel to the Credit Parties and (B) local counsel in the States of Colorado, North Dakota and Oklahoma, in each case, in form and substance reasonably satisfactory to Administrative Agent;
(xvi) a solvency certificate of the chief financial officer or chief executive officer of Borrower, certifying the solvency of Borrower and its Restricted Subsidiaries, on a consolidated basis, after giving effect to the transactions on the Effective Date; and
(xvii) a certificate of any Authorized Officer of Borrower, dated as of the Effective Date, certifying that attached to such certificate, is a true, accurate and complete copy of the Stockholders’ Agreement (including any amendments thereto), duly executed by the Sponsors and Parent.
(b)Initial Public Offering. Administrative Agent shall have received evidence satisfactory to it of (i) the issuance by the Parent of its common Equity Interests generating gross proceeds exceeding $200,000,000, in an underwritten primary public offering (other than a public offering pursuant to a registration statement on Form S-8) pursuant to an effective registration statement filed with the SEC in accordance with the Securities Act (the “Initial Public Offering”) and (ii) the contribution of 100% of the net cash proceeds thereof to Borrower.
(c)Fees and Expenses. All fees of Administrative Agent, the Arranger, the Banks and their respective Affiliates in connection with the credit facilities provided herein (including those payable pursuant to Section 2.13), and all expenses of Administrative Agent and the Arranger in connection with such credit facilities, shall have been paid.
(d)Know Your Customer Documentation. Administrative Agent and each of the Banks shall have received from the Credit Parties, to the extent requested by Administrative Agent or such Bank at least five (5) Business Days prior to the Effective Date, all documentation and other information required by regulatory authorities under applicable “know your customer” and anti-money laundering rules and regulations, including the USA Patriot Act.
(e)Beneficial Ownership Regulation. To the extent requested by any Bank or Administrative Agent from Borrower directly at least five (5) Business Days prior to the Effective Date, Borrower, to the extent qualifying as a “legal entity customer” under the Beneficial
Ownership Regulation, shall deliver to each such Bank or Administrative Agent a Beneficial Ownership Certification at least two (2) Business Days prior to the Effective Date.
(f)No Legal Prohibition. The transactions contemplated by this Agreement and the other Loan Papers shall be permitted by applicable Law and such Laws shall not subject Administrative Agent, any Bank, or any Credit Party to any Material Adverse Change.
(g)No Litigation. No litigation, arbitration or similar proceeding shall be pending which calls into question the validity or enforceability of this Agreement and/or the other Loan Papers.
(h)Due Diligence. Administrative Agent shall have received, and satisfactorily completed its review of, all due diligence information regarding Borrower and its Subsidiaries as Administrative Agent shall have requested.
(i)Title Review. Administrative Agent or its counsel shall have completed a review of title regarding that portion of the Borrowing Base Properties which results in evidence of title satisfactory to Administrative Agent and its counsel.
(j)Review of Properties. Administrative Agent or its counsel shall have completed a due diligence review of the Credit Parties’ Mineral Interests and other operations. Administrative Agent shall also be reasonably satisfied with the environmental condition of the Credit Parties’ Mineral Interests.
(k)Collateral Security. Administrative Agent shall be reasonably satisfied that the requirements of Section 5.1 are satisfied as of the Effective Date.
(l)Initial Financial Statements and the Initial Reserve Report. Administrative Agent shall have received the Current Financials and the Initial Reserve Report.
(m)Revolving Availability. After giving effect to the transactions contemplated hereby, including the Owl Rock Payoff, the amount of the Outstanding Revolving Credit shall not exceed $0.00.
(n)No Material Adverse Change. As of the Effective Date, no Material Adverse Change has occurred.
(o)Other Matters. All matters related to this Agreement, the other Loan Papers and any Credit Party shall be acceptable to Administrative Agent, and Borrower shall have delivered to Administrative Agent and each Bank such evidence as Administrative Agent shall request to substantiate any matters related to this Agreement, the other Loan Papers or any Credit Party.
For purposes of determining compliance with the conditions specified in this Section 6.1, each Bank that has signed this Agreement shall be deemed to have consented to, approved or accepted or to be satisfied with, each document or other matter required under this Section 6.1 to be consented to or approved by or acceptable or satisfactory to a Bank unless Administrative Agent shall have received notice from such Bank prior to the Effective Date specifying its objection
thereto. All documents executed or submitted pursuant to this Section 6.1 by and on behalf of Borrower or any of its Restricted Subsidiaries shall be in form and substance satisfactory to Administrative Agent and its counsel. Administrative Agent shall notify the Banks of the Effective Date, and such notice shall be conclusive and binding.
Section 6.2 Each Credit Event. The obligation of each Bank to loan its Applicable Percentage of each Borrowing and the obligation of any Letter of Credit Issuer to issue Letters of Credit on the date any Letter of Credit is to be issued is subject to the further satisfaction of the following conditions:
(a)timely receipt by Administrative Agent of a Request for Borrowing or Request for Letter(s) of Credit (as applicable);
(b)immediately before and after giving effect to such Borrowing or issuance of such Letter(s) of Credit, no Default or Event of Default shall have occurred and be continuing and neither such Borrowing nor the issuance of such Letter(s) of Credit (as applicable) shall cause a Default or Event of Default;
(c)the representations and warranties of each Credit Party contained in this Agreement and the other Loan Papers shall be true and correct in all material respects on and as of the date of such Borrowing or the issuance of such Letter(s) of Credit (as applicable), except (i) to the extent such representations and warranties are expressly stated as of a certain date, in which case such representations and warranties shall be true and correct in all material respects as of such date and (ii) to the extent that any such representation and warranty is expressly qualified by materiality or by reference to Material Adverse Effect, such representation and warranty (as so qualified) shall continue to be true and correct in all respects;
(d)the funding of such Borrowing or the issuance of such Letter(s) of Credit (as applicable) and all other Borrowings to be made and/or Letter(s) of Credit to be issued (as applicable) on the same day under this Agreement, shall not cause the total Outstanding Revolving Credit to exceed the Total Commitment (i.e., the least of (x) the Aggregate Maximum Credit Amounts, (y) the then effective Borrowing Base and (z) the then effective Aggregate Elected Commitment Amount); and
(e)following the issuance of any Letter(s) of Credit, the aggregate Letter of Credit Exposure of all Banks shall not exceed the lesser of (x) $10,000,000 and (y) the Total Commitment (i.e., the least of (x) the Aggregate Maximum Credit Amounts, (y) the then effective Borrowing Base and (z) the then effective Aggregate Elected Commitment Amount).
(f)Each Borrowing and the issuance of each Letter of Credit hereunder shall constitute a representation and warranty by Borrower that on the date of such Borrowing or issuance of such Letter of Credit (as applicable) the statements contained in subclauses (b), (c), (d) and (e) above are true.
ARTICLE VII REPRESENTATIONS AND WARRANTIES
Borrower represents and warrants to Banks that:
Section 7.1 Existence and Power. Each of the Credit Parties (a) is a corporation, limited liability company or partnership duly incorporated or organized (as applicable), and is validly existing and in good standing under the Laws of its jurisdiction of incorporation or organization (as applicable), (b) has all corporate, limited liability company or partnership power (as applicable) and all material governmental licenses, authorizations, consents and approvals required to carry on its businesses as now conducted and as proposed to be conducted, and (c) is duly qualified to transact business as a foreign corporation, foreign limited liability company or foreign partnership (as applicable) in each jurisdiction where a failure to be so qualified could reasonably be expected to have a Material Adverse Effect.
Section 7.2 Corporate, Limited Liability Company, Partnership and Governmental Authorization; Contravention. The execution, delivery and performance of this Agreement, the Notes, the Mortgages and the other Loan Papers by each Credit Party (as applicable) (a) are within such Credit Party’s corporate, partnership, or limited liability company powers (as applicable), (b) have been duly authorized by all necessary corporate, partnership, or limited liability company action (as applicable), (c) except to the extent that such performance requires actions or filings in connection with the conduct of a Credit Party’s business or maintenance of its existence or good standing, require no action by or in respect of, or filing with, any Governmental Authority or official, (d) do not contravene, or constitute a default under, the articles of association, partnership agreement, certificate of limited partnership, articles of incorporation, certificate of incorporation, bylaws, regulations or other organizational documents (as applicable) of any such Credit Party or the Margin Regulations, (e) do not in any material respect contravene, or constitute a default under, any provision of applicable Law or any provision of any agreement, judgment, injunction, order, decree or other instrument binding upon any such Credit Party, and (f) do not result in the creation or imposition of any Lien on any asset of any such Credit Party except Liens securing the Obligations.
Section 7.3 Binding Effect. (a) Each of this Agreement and the Notes constitutes a valid and binding agreement of Borrower; (b) the Mortgages, the Security Agreement, the Facility Guaranty, the other Security Instruments and the other Loan Papers when executed and delivered in accordance with this Agreement, will then constitute valid and binding obligations of each Credit Party party thereto; and (c) each Loan Paper is enforceable against each Credit Party party thereto in accordance with its terms except as (i) the enforceability thereof may be limited by bankruptcy, insolvency or similar Laws affecting creditors’ rights generally, and (ii) the availability of equitable remedies may be limited by equitable principles of general applicability.
Section 7.4 Financial Information.
(a)The Current Financials fairly present, in conformity with GAAP (except to the extent that GAAP does not address consolidating financial statements), the consolidated financial position of Borrower and its consolidated results of operations and cash flows (but solely
with respect to Borrower and its Subsidiaries constituting Consolidated Subsidiaries upon giving effect to the Initial Public Offering) as of the date and for the periods covered thereby.
(b)There has been no Material Adverse Change in the business, assets, liabilities, financial condition or results of operations of the Credit Parties, taken as a whole, relative to that set forth in the Current Financials as of December 31, 2018.
Section 7.5 Litigation. Except for matters disclosed on Schedule 2 hereto, there is no action, suit or proceeding pending against, or to the knowledge of any Credit Party, threatened against or affecting any Credit Party before any court, arbitrator, Governmental Authority or official in which there is a reasonable possibility of an adverse decision that would have a Material Adverse Effect.
Section 7.6 ERISA.
(a) | Except as could not reasonably be expected to have a Material Adverse |
Effect:
(i) | Each Credit Party and each ERISA Affiliate have complied in all |
material respects with ERISA and, where applicable, the Code regarding each Plan, if any.
(ii) Each Plan is, and has been, established and maintained in substantial compliance with its terms, ERISA and, where applicable, the Code.
(iii) No act, omission or transaction has occurred which could result in imposition on any Credit Party or any ERISA Affiliate (whether directly or indirectly) of (i) either a civil penalty assessed pursuant to subsections (c), (i), (l) or (m) of section 502 of ERISA or a tax imposed pursuant to Chapter 43 of Subtitle D of the Code or (ii) breach of fiduciary duty liability damages under section 409 of ERISA.
(iv) Full payment when due has been made of all amounts which the Credit Parties or any ERISA Affiliate is required under the terms of each Plan or applicable Law to have paid as contributions to such Plan as of the Effective Date.
(b)Neither any Credit Party nor any ERISA Affiliate sponsors, maintains, or contributes to an employee welfare benefit plan, as defined in section 3(1) of ERISA, including any such plan maintained to provide benefits to former employees of such entities, that may not be terminated by any Credit Party or any ERISA Affiliate in its sole discretion at any time without any material liability.
(c)Neither any Credit Party nor any ERISA Affiliate sponsors, maintains or contributes to, or has at any time in the six-year period preceding the Effective Date sponsored, maintained or contributed to, any employee pension benefit plan, as defined in section 3(2) of ERISA, that is subject to Title IV of ERISA, section 302 of ERISA or section 412 of the Code.
Section 7.7 Taxes and Filing of Tax Returns. Each Credit Party has filed all material tax returns required to have been filed and has paid all material Taxes shown to be due and payable on such returns and all other material Taxes which are payable by such party, to the extent the
same have become due and payable. Borrower knows of no proposed material Tax assessment against any Credit Party, and each Credit Party maintains adequate reserves in accordance with GAAP with respect to all of its Tax liabilities of and those of its predecessors. Except as disclosed in writing to Banks, no Tax liability of any Credit Party, or any of their predecessors, has been asserted by the Internal Revenue Service for Taxes, in excess of those already paid.
Section 7.8 Title to Properties; Liens. Each Credit Party has good and valid title to all material assets purported to be owned by it except for Permitted Encumbrances. Without limiting the foregoing, Borrower and/or its Restricted Subsidiaries have good, valid and defensible title to all Borrowing Base Properties (except for Borrowing Base Properties disposed of in compliance with, and to the extent permitted by Section 9.5 to the extent this representation and warranty is made or deemed made after the Effective Date), free and clear of all Liens, except for Permitted Encumbrances.
Section 7.9 Mineral Interests. All Borrowing Base Properties are valid, subsisting, and in full force and effect in all material respects, and all rentals, royalties, and other amounts due and payable in respect thereof have been duly paid or provided for in all material respects (except for those amounts being contested by a Credit Party in good faith or held in suspense in accordance with oil industry practice); provided that, to the extent Mineral Interests owned by any such Credit Party are operated by operators other than such Credit Party or an Affiliate of such Credit Party, Borrower has no knowledge that any such obligation remains unperformed in any material respect and the appropriate Person has enforced the contractual obligations of such operators in accordance with reasonable commercial practices in the oil industry in order to ensure performance. Except as may be provided in any consent or non-consent provisions of any joint operating agreement covering any Credit Party’s Proved Mineral Interests, to the extent applicable, each Credit Party’s share of (a) the costs attributable to each Borrowing Base Property is not greater than the decimal fraction set forth in the most recently delivered Reserve Report, before and after payout, as the case may be, and described therein by the respective designations “working interests”, “WI”, “gross working interest”, “GWI”, or similar terms, and (b) production from, allocated to, or attributed to each such Borrowing Base Property is not less than the decimal fraction set forth in the Reserve Report, before and after payout, as the case may be, and described therein by the designations “net revenue interest,” “NRI,” or similar terms.
Section 7.10 Business; Compliance. Each Credit Party has performed and abided by all obligations required to be performed under each license, permit, order, authorization, grant, contract, agreement, or regulation to which such Credit Party is a party or by which such Credit Party or any of the assets of such Credit Party are bound to the extent a failure to perform and abide by such obligations could reasonably be expected to have a Material Adverse Effect; provided that, to the extent Mineral Interests owned by any such Credit Party are operated by operators other than such Credit Party or an Affiliate of such Credit Party, Borrower has no knowledge that any such obligation remains unperformed in any material respect and the appropriate Person has enforced the contractual obligations of such operators in accordance with reasonable commercial practices in the industry in order to ensure performance.
Section 7.11 Licenses, Permits, Etc. Each Credit Party possesses such valid franchises, certificates of convenience and necessity, operating rights, licenses, permits, consents, authorizations, exemptions and orders of tribunals, as are necessary to carry on its businesses as
now being conducted except to the extent a failure to obtain any such item would not reasonably be expected to have a Material Adverse Effect; provided that, to the extent Mineral Interests owned by any Credit Party are operated by operators other than such Credit Party or an Affiliate of such Credit Party, Borrower has no knowledge that possession of such items has not been obtained.
Section 7.12 Compliance with Law. The business and operations of each Credit Party have been and are being conducted in accordance with all applicable Laws, rules and regulations including all Margin Regulations, of all tribunals and Governmental Authorities, other than Laws, the violation of which could not (either individually or collectively) reasonably be expected to have a Material Adverse Effect; provided that to the extent Mineral Interests owned by any Credit Party are operated by operators other than any Credit Party or an Affiliate of any Credit Party, Borrower has no knowledge of non-compliance and the appropriate Person has enforced all contractual obligations of such operators in accordance with reasonable commercial practices in the industry in order to achieve compliance.
Section 7.13 Solvency. After giving effect to the transactions contemplated hereby, including each Borrowing made hereunder and each issuance, amendment, renewal or extension of a Letter of Credit, (a) the aggregate assets (after giving effect to amounts that could reasonably be expected to be received by reason of indemnity, offset, insurance or any similar arrangement), at a fair valuation, of Borrower and its Restricted Subsidiaries, taken as a whole, exceed the aggregate Debt of Borrower and its Restricted Subsidiaries on a consolidated basis, (b) each of Borrower and its Restricted Subsidiaries has not incurred and does not intend to incur, and does not believe that it has incurred, Debt beyond its ability to pay such Debt (after taking into account the timing and amounts of cash it reasonably expects could be received and the amounts that it reasonably expects could be payable on or in respect of its liabilities, and giving effect to amounts that could reasonably be expected to be received by reason of indemnity, offset, insurance or any similar arrangement) as such Debt becomes absolute and matures, and (c) each of Borrower and its Restricted Subsidiaries does not have (and does not have reason to believe that it will have thereafter) unreasonably small capital for the conduct of its business.
Section 7.14 Full Disclosure.
(a)All information, taken as a whole, heretofore furnished by or on behalf of any Credit Party to Administrative Agent, the Arranger, or any Bank for purposes of or in connection with this Agreement or any transaction contemplated hereby is, and all such information hereafter furnished by or on behalf of any Credit Party to Administrative Agent, the Arranger, or any Bank will be, true, complete, and accurate in every material respect and based on reasonable estimates on the date as of which such information is stated or certified (it being understood that actual results may vary materially from the financial projections provided hereunder). There are no statements or conclusions in any Reserve Report which are based upon or include misleading information or fail to take into account material information regarding the matters reported therein, it being understood that projections concerning volumes attributable to the Mineral Interests and production and cost estimates contained in each Reserve Report are necessarily based upon professional opinions, estimates and projections and that the Credit Parties do not warrant that such opinions, estimates and projections will ultimately prove to have been accurate.
(b)As of the Effective Date, the information included in the Beneficial Ownership Certification is true and correct in all respects.
Section 7.15 Organizational Structure; Nature of Business. The primary business of the Credit Parties is the acquisition, ownership, maintenance and selling, leasing or otherwise disposing of Mineral Interests; provided that, for the avoidance of doubt, neither Borrower nor any of its Restricted Subsidiaries operates, explores or develops Mineral Interests; provided, further that the foregoing proviso shall not be construed to prohibit actions incidental to any such Person’s ownership of non-operated working interests. As of the Effective Date, Schedule 3 hereto accurately reflects (a) the jurisdiction of incorporation or organization of each Credit Party, (b) each jurisdiction in which each Credit Party is qualified to transact business as a foreign corporation, foreign partnership or foreign limited liability company and (c) the authorized, issued and outstanding Equity Interests of each Credit Party (other than Borrower) and each Subsidiary of each Credit Party, including, the names of (and number of Equity Interests held by) the record and beneficial owners of such Equity Interests. Except as set forth in this Section 7.15 and in Schedule 3 hereto, as of the Effective Date, no Person holds record or beneficial ownership of any Equity Interest in any Credit Party (other than Borrower) or any Subsidiary of any Credit Party. No Credit Party presently holds any Investments other than Permitted Investments. Except as set forth in Schedule 3 hereto, as of the Effective Date, no Credit Party has any Subsidiaries, and no Credit Party is a partner or joint venturer in any partnership or joint venture or a member of any unincorporated association.
Section 7.16 Environmental Matters. No Property owned or leased by any Credit Party (including Mineral Interests) and no operations conducted thereon, and no operations of any prior owner, lessee or operator of any such Properties, is or has been in violation of any Applicable Environmental Law other than violations which neither individually nor in the aggregate will have a Material Adverse Effect, nor is any such Property or operation the subject of any existing, pending or, to Borrower’s knowledge, threatened Environmental Complaint which could, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect. All notices, permits, licenses, and similar authorizations, if any, required to be obtained or filed in connection with the ownership or operation of any and all real and personal property owned, leased or operated by any Credit Party, including notices, licenses, permits and authorizations required in connection with any past or present treatment, storage, disposal, or release of Hazardous Substances into the environment, have been duly obtained or filed except to the extent the failure to obtain or file such notices, licenses, permits and authorizations would not reasonably be expected to have a Material Adverse Effect. Except for such matters that, individually or in the aggregate, could not reasonably be expected to have a Material Adverse Effect, none of the Properties of any Credit Party contain or have contained any: (a) underground storage tanks; (b) asbestos-containing materials; (c) landfills or dumps; (d) hazardous waste management units as defined pursuant to RCRA or any comparable state law; or (e) sites on or nominated for the National Priority List promulgated pursuant to CERCLA or any state remedial priority list promulgated or published pursuant to any comparable state law. There have been no Hazardous Discharges which were not in compliance with Applicable Environmental Laws other than Hazardous Discharges which would not, individually or in the aggregate, have a Material Adverse Effect. No Credit Party has any contingent liability in connection with any Hazardous Discharges which could reasonably be expected to have a Material Adverse Effect. Notwithstanding anything to the contrary in this Section 7.16, to the extent Mineral Interests owned by any Credit Party are
operated by operators other than any Credit Party or an Affiliate of any Credit Party, Borrower has no knowledge of non-compliance.
Section 7.17 Burdensome Obligations. No Credit Party is a party to or bound by any agreement (other than the Loan Papers), or subject to any Law of any Governmental Authority, which prohibits or restricts in any way (a) the right of such party to grant Liens to Administrative Agent and Banks on or in respect of their Properties to secure the Obligations and the Loan Papers or (b) the right of any Restricted Subsidiary to make Restricted Payments to any other Credit Party that owns Equity Interests in such Restricted Subsidiary.
Section 7.18 Government Regulations. No Credit Party is subject to regulation under the Federal Power Act, the Interstate Commerce Act, the Investment Company Act of 1940 (as any of the preceding acts have been amended) or any other Law that limits the incurrence of Debt by such Credit Party, including Laws relating to common carriers or the sale of electricity, gas, steam, water or other public utility services.
Section 7.19 No Default. Neither a Default nor an Event of Default has occurred and is continuing.
Section 7.20 Gas Balancing Agreements and Advance Payment Contracts. Solely to the extent Borrower or any Restricted Subsidiary owns any working interests in any Proved Mineral Interests, except as set forth on the most recent certificate delivered pursuant to Section 8.1(c), there are no Material Gas Imbalances or Advance Payment Contracts which would require Borrower or any of its Restricted Subsidiaries to deliver Hydrocarbons produced from their Borrowing Base Properties comprised of working interests in Proved Mineral Interests at some future time without then or thereafter receiving full payment therefor exceeding one-half bcf of gas (on an mcf equivalent basis) in the aggregate; provided that to the extent any such working interests in Proved Mineral Interests owned by any Credit Party are operated by operators other than any Credit Party or an Affiliate of any Credit Party, Borrower has no knowledge of non- compliance based upon information available to Borrower from such operators.
Section 7.21 Anti-Corruption Laws and Sanctions. Each Credit Party has implemented and maintains in effect policies and procedures designed to achieve compliance by such Credit Party, its Subsidiaries and their respective directors, officers, employees and agents with Anti- Corruption Laws and applicable Sanctions, and such Credit Party, its Subsidiaries and their respective officers and employees and, to the knowledge of such Credit Party, its directors and agents, are in compliance with Anti-Corruption Laws and applicable Sanctions in all material respects. None of (a) any Credit Party, any Subsidiary or any of their respective directors, officers or employees, or (b) to the knowledge of any such Credit Party or Subsidiary, any agent of such Credit Party or any Subsidiary that will act in any capacity in connection with or benefit from the credit facility established hereby, is a Sanctioned Person. No Borrowing or Letter of Credit, use of proceeds, or other transaction contemplated by this Agreement or the other Loan Documents will violate Anti-Corruption Laws or applicable Sanctions.
Section 7.22 EEA Financial Institutions. No Credit Party is an EEA Financial Institution.
ARTICLE VIII AFFIRMATIVE COVENANTS
Borrower agrees that, so long as any Bank has any commitment to lend or participate in Letter of Credit Exposure hereunder or any Loan or any other amount payable under any Note remains unpaid or any Letter of Credit remains outstanding:
Section 8.1 Information. Borrower will deliver, or cause to be delivered, to each Bank:
(a)(i) at any time when (x) Parent and its Subsidiaries (including Holdings but other than Borrower and its Subsidiaries) own no assets other than Specified Parent Investments and have no other operations other than those ancillary to their ownership of such Specified Parent Investments and (y) Borrower is a Consolidated Subsidiary of Parent (the foregoing clauses (x) and (y), the “Parent Audit Conditions”), as soon as available and in any event within 120 days (or with respect to the delivery of the financial statements of Parent required to be delivered pursuant to clauses (A) and (C) herein, as soon as available and in any event within 90 days (or, if earlier, on the date on which such financial statements are required to be filed with the SEC after giving effect to any permitted extensions pursuant to Rule 12b-25 under the Exchange Act)) after the end of each Fiscal Year of Parent and Borrower, commencing with Fiscal Year ending December 31, 2019, (A) audited consolidated balance sheets of Parent as of the end of such Fiscal Year and the related consolidated statements of income and cash flows for such Fiscal Year, setting forth in each case in comparative form the figures for the previous Fiscal Year, all reported on by independent public accountants of recognized national standing (without a “going concern” or like qualification or exception and without any qualification or exception as to the scope of such audit) to the effect that such consolidated financial statements present fairly in all material respects the financial condition and results of operations of Parent and its Consolidated Subsidiaries on a consolidated basis in accordance with GAAP consistently applied, as applicable,
(B)unaudited consolidated balance sheets of Borrower as of the end of such Fiscal Year and the related consolidated statements of income and cash flows for such Fiscal Year, setting forth in each case in comparative form the figures for the previous Fiscal Year, all certified by the chief financial officer, principal accounting officer, treasurer, controller or chief executive officer of Borrower as presenting fairly in all material respects the financial condition and results of operations of Borrower and its Consolidated Subsidiaries on a consolidated basis in accordance with GAAP consistently applied, subject to the absence of footnotes; and (C) unaudited consolidating balance sheets of Parent, separating out Borrower by a specific column, as of the end of such Fiscal Year and the related consolidating statements of income and cash flows for such Fiscal Year, setting forth in each case in comparative form the figures for the previous Fiscal Year, all certified by the chief financial officer, principal accounting officer, treasurer, controller or chief executive officer of Borrower as presenting fairly in all material respects the financial condition and results of operations of Parent and its Consolidated Subsidiaries on a consolidating basis in accordance with GAAP consistently applied, subject to the absence of footnotes; and
(ii) at any other time, as soon as available and in any event within 120 days after the end of each Fiscal Year of Borrower, commencing with Fiscal Year ending December 31, 2019, audited consolidated balance sheets of Borrower as of the end of such Fiscal Year and the related
consolidated statements of income and cash flows for such Fiscal Year, setting forth in each case in comparative form the figures for the previous Fiscal Year, all reported on by
independent public accountants of recognized national standing (without a “going concern” or like qualification or exception and without any qualification or exception as to the scope of such audit) to the effect that such consolidated financial statements present fairly in all material respects the financial condition and results of operations of Borrower and its Consolidated Subsidiaries on a consolidated basis in accordance with GAAP consistently applied, as applicable.
(b)as soon as available and in any event within 60 days (or with respect to the delivery of the financial statements of Parent in this clause (b), as soon as available and in any event within 45 days (or, if earlier, on the date on which such financial statements are required to be filed with the SEC after giving effect to any permitted extensions pursuant to Rule 12b-25 under the Exchange Act)) after the end of each of the first three Fiscal Quarters of each Fiscal Year of Borrower and Parent, commencing with the Fiscal Quarter ending June 30, 2019, (i) consolidated balance sheets of Borrower and consolidated balance sheets of Parent, in each case as of the end of such Fiscal Quarter, (ii) the related consolidated statements of income and cash flows for such Fiscal Quarter and for the portion of Borrower’s Fiscal Year or Parent’s Fiscal Year, as applicable, ended at the end of such Fiscal Quarter, and (iii) at any time the Parent Audit Conditions are satisfied, consolidating balance sheets of Parent, separating out Borrower by a specific column, as of the end of such Fiscal Quarter and the related consolidating statements of income and cash flows for such Fiscal Quarter, setting forth in each case in comparative form the figures for the corresponding quarter and the corresponding portion of Borrower’s or Parent’s, as applicable, previous Fiscal Year;
(c)simultaneously with the delivery of each set of financial statements of Borrower referred to in Section 8.1(a) and Section 8.1(b), a certificate of the chief financial officer, principal accounting officer, treasurer, controller or chief executive officer of Borrower substantially in the form of Exhibit F hereto, (i) setting forth in reasonable detail (either in attachments thereto or in spreadsheets delivered in connection therewith) the calculations required to establish whether Borrower was in compliance with the requirements of Article X on the date of such financial statements (it being understood that, notwithstanding anything to the contrary herein, the calculations required to establish whether Borrower was in compliance with the requirements of Article X shall be based on either (A) at any time the Parent Audit Conditions are satisfied, the unaudited consolidating financial statements of Parent delivered to the Banks pursuant to Section 8.1(a) and Section 8.1(b) and (B) at any other time, the audited or unaudited, a applicable, consolidated financial statements of Borrower delivered to the Banks pursuant to Section 8.1(a) and Section 8.1(b)), (ii) stating whether there exists on the date of such certificate any Default and, if any Default then exists, setting forth the details thereof and the action which Borrower is taking or proposes to take with respect thereto, (iii) stating whether or not such financial statements fairly present in all material respects the results of operations and financial condition of Borrower as of the date of such financial statements and for the period covered thereby, (iv) to the extent Borrower or any Restricted Subsidiary owns any working interest in any Proved Mineral Interests, setting forth as of the date of such financial statements (A) whether there is a Material Gas Imbalance and, if so, setting forth the estimated amount of net gas imbalances under Gas Balancing Agreements to which any Credit Party is a party or by which any working interests in Proved Mineral Interests owned by any Credit Party are bound, and (B) the aggregate amount of all Advance Payments in excess of the Threshold Amount received under Advance Payment Contracts to which Borrower or any Restricted Subsidiary is a party or by which any working interests in Proved Mineral Interests owned by any Credit Party are bound which have
not been satisfied by delivery of production, if any, (v) setting forth as of the date of such financial statements, a true and complete list of all Hedge Transactions of Borrower and each Restricted Subsidiary, the counterparties thereto, the material terms thereof (including the type, term, effective date, termination date and notional amounts or volumes), the estimated net xxxx-to- market value therefor, any credit support agreements relating thereto other than the Loan Papers, and any margin required or supplied under any such credit support document, and (vi) to the extent Borrower has any Unrestricted Subsidiaries, having consolidating spreadsheets attached thereto (or delivered in connection therewith) that show all Consolidated Unrestricted Subsidiaries and the eliminating entries, in such form as would be presentable to the auditors of Borrower;
(d)at any time the financial statements delivered pursuant Section 8.1(a) or Section 8.1(b) are not prepared in accordance with clause (a) of Section 1.3 with respect to capital leases and operating leases, then concurrently with any such delivery of financial statements, a certificate of the chief financial officer, principal accounting officer, treasurer, controller or chief executive officer of Borrower setting forth and certifying as to internally prepared financial statements reflecting the accounting treatment of capital leases and operating leases pursuant to clause (a) of Section 1.3;
(e)promptly upon any Authorized Officer of any Credit Party becoming aware of the occurrence of any Default under any of the Loan Papers, including a Default under Article X, a certificate of an Authorized Officer of Borrower setting forth the details thereof and the action which Borrower is taking or propose to take with respect thereto;
(f)simultaneously with the delivery of each Reserve Report prepared as of December 31 of each Fiscal Year pursuant to Section 4.1, a corporate model for Borrower and its Restricted Subsidiaries for such fiscal year, including the projected monthly production of Mineral Interests by Borrower and its Restricted Subsidiaries and the assumptions used in calculating such projections, the projected capital expenditures to be incurred by Borrower and its Restricted Subsidiaries and projected cash flows, and such other information as may be reasonably requested by Administrative Agent; it being understood that projections concerning volumes attributable to the Mineral Interests of Borrower and its Restricted Subsidiaries and production and cost estimates contained in such projections are necessarily based upon professional opinions, estimates and projections and that Borrower and its Restricted Subsidiaries do not warrant that such opinions, estimates and projections will ultimately prove to have been accurate;
(g)prompt notice of any Material Adverse Change in the financial condition of the Credit Parties, taken as a whole;
(h)promptly upon receipt of same, any written notice received by any Credit Party from a Governmental Authority indicating any potential, actual or alleged (i) non- compliance with or violation of the requirements of any Applicable Environmental Law which could result in liability to any Credit Party for fines, clean up or any other remediation obligations or any other liability in excess of the Threshold Amount in the aggregate; (ii) Hazardous Discharge or threatened Hazardous Discharge of any Hazardous Substance which Hazardous Discharge would impose on any Credit Party a duty to report to a Governmental Authority or to pay cleanup costs or to take
remedial action under any Applicable Environmental Law which could result in liability to any Credit Party for fines, clean-up and other remediation obligations or any other
liability in excess of the Threshold Amount in the aggregate; or (iii) the existence of any Lien arising under any Applicable Environmental Law securing any obligation to pay fines, clean up or other remediation costs or any other liability in excess of the Threshold Amount in the aggregate;
(i)prompt notice of any actions, suits, proceedings, claims or disputes pending or, to the knowledge of Borrower after due and diligent investigation, threatened in writing, whether at law, in equity, in arbitration or before any Governmental Authority, by or against any Credit Party or against any of their Properties that (i) purport to affect or pertain to this Agreement or any other Loan Paper or the transactions hereunder or thereunder, or (ii) either individually or in the aggregate, if determined adversely, could reasonably be expected to have a Material Adverse Effect;
(j)as soon as available and in any event no later than 60 days after the end of each Fiscal Quarter, a report setting forth, for each calendar month during such Fiscal Quarter, the volume of production and sales attributable to production (and the prices at which such sales were made and the revenues derived from such sales) for each such calendar month from the Borrowing Base Properties, and setting forth the related ad valorem, severance and production taxes and lease operating expenses attributable thereto and incurred for each such calendar month, such information being reported in form and substance acceptable to Administrative Agent;
(k)prompt notice of any material change in accounting policies or financial reporting practices by any Credit Party;
(l)from time to time such additional information regarding the financial position or business of each Credit Party (including any Plan and any reports or other information required to be filed with respect thereto under the Code or under ERISA and a list of all Persons purchasing Hydrocarbons from any Credit Party) as Administrative Agent, at the request of any Bank, may reasonably request;
(m)promptly following any reasonable request therefor, information and documentation reasonably requested by Administrative Agent or any Bank for purposes of compliance with the Beneficial Ownership Regulation or applicable “know your customer” requirements under the USA Patriot Act or other applicable anti-money laundering laws;
(n)prompt written notice, and in any event within three (3) Business Days (or such longer period of time as Administrative Agent may agree to in its discretion), of (i) the occurrence of any material loss, casualty or other insured damage to, or any nationalization, taking under power of eminent domain or by condemnation or similar proceeding of, any property of Borrower or any other Credit Party having a fair market value in excess of the Threshold Amount or (ii) the commencement of any action or proceeding that could reasonably be expected to result in a such an event;
(o)as soon as available and in any event no later than 60 days after the end of each Fiscal Quarter, a schedule of all Proved Mineral Interests sold or assigned by Borrower or any other Credit Party during such Fiscal Quarter to any purchaser or assignee other than a Credit Party;
(p)no later than five (5) Business Days (or such shorter period of time as Administrative Agent may agree to in its discretion) prior to any Asset Disposition that will cause a reduction in the Borrowing Base pursuant to Section 4.6, written notice of such Asset Disposition, in such detail as Administrative Agent may request;
(q)prior written notice of the intended incurrence of any Permitted Additional Debt, the anticipated amount thereof, and the anticipated date of closing and promptly when available a copy of the preliminary offering memorandum (if any) and the final offering memorandum (if any);
(r)promptly, but in any event within five (5) Business Days (or such longer period of time as Administrative Agent may agree to in its discretion) after the execution thereof, copies of any amendment, modification or supplement to the certificate or articles of incorporation, by-laws, any preferred stock designation or any other organic document of Borrower or any other Credit Party that could reasonably be expected to adversely affect the interests of the Banks in any material respect;
(s)prompt written notice (and in any event no less than 30 days prior thereto, or such shorter period of time as Administrative Agent may agree to in its discretion) of any change
(1) in Borrower’s or any other Credit Party’s corporate, partnership or company name, (2) in the location of Borrower’s or any other Credit Party’s chief executive office or, if it has none, its principal place of business, (3) in Borrower’s or any other Credit Party’s identity or corporate structure, (4) in Borrower’s or any other Credit Party’s jurisdiction of organization or such Person’s organizational identification number in such jurisdiction of organization, and (5) in Borrower’s or any other Credit Party’s federal taxpayer identification number;
(t)prompt written notice of the acquisition or organization of any new Domestic Subsidiary of Borrower (and thereupon Borrower will comply, and cause such Domestic Subsidiary to comply, with Section 5.4);
(u)promptly following any request therefor, such other information regarding the operations, business affairs and financial condition of Borrower or any Subsidiary (including any Plan and any reports or other information required to be filed with respect thereto under the Code or under ERISA), or compliance with the terms of this Agreement or any other Loan Paper, as Administrative Agent or any Bank acting through Administrative Agent may reasonably request; and
(v)prompt written notice (such notice to include reasonably detailed information regarding the account number, purpose and applicable bank or other institution in respect of such Deposit Account, Commodity Account or Securities Account) to Administrative Agent of any Deposit Account, Commodity Account or Securities Account (other than a De Minimis Account) intended to be opened by Borrower or any Guarantor.
Solely the financial statements of Parent required to be delivered pursuant to Section 8.1(a)(i) and Section 8.1(b) may be delivered electronically and if so delivered, shall be deemed to have been delivered on the date (x) on which Parent posts such financial statements, or provides a link thereto on Parent’s public website; or (y) on which such financial statements are posted on Parent’s behalf
on an Internet or intranet website, if any, to which each Bank and Administrative Agent have access (whether a commercial, third-party website or whether sponsored by Administrative Agent); provided that: (1) Borrower shall deliver, or cause Parent to deliver, paper copies of such financial statements to Administrative Agent or any Bank upon its request to Borrower to deliver such paper copies until a written request to cease delivering paper copies is given by Administrative Agent or such Bank and (2) Borrower shall notify Administrative Agent and each Bank of the posting of any such financial statements and provide to Administrative Agent by electronic mail electronic versions (i.e., soft copies) of such financial statements. Administrative Agent shall have no obligation to request the delivery of or to maintain paper copies of the financial statements referred to above, and in any event shall have no responsibility to monitor compliance by Borrower with any such request by a Bank for delivery, and each Bank shall be solely responsible for requesting delivery to it or maintaining its copies of such financial statements.
Borrower hereby acknowledges that (a) Administrative Agent and/or the Arranger will make available to Banks and the Letter of Credit Issuer materials and/or information provided by or on behalf of Borrower hereunder (collectively, “Borrower Materials”) by posting Borrower Materials on IntraLinks or another similar electronic system (the “Platform”) and (b) certain of Banks (each, a “Public Bank”) may have personnel who do not wish to receive material non-public information with respect to Borrower or its Affiliates, or the respective securities of any of the foregoing, and who may be engaged in investment and other market-related activities with respect to such Persons’ securities. Borrower hereby agrees that, as reasonably requested by any Bank, (i) Borrower will use commercially reasonable efforts to identify that portion of the Borrower Materials that may be distributed to the Public Banks; (ii) all such Borrower Materials shall be clearly and conspicuously marked “PUBLIC” which, at a minimum, shall mean that the word “PUBLIC” shall appear prominently on the first page thereof; (iii) by marking Borrower Materials “PUBLIC,” Borrower shall be deemed to have authorized Administrative Agent, the Arranger, the Letter of Credit Issuer and Banks to treat such Borrower Materials as not containing any material non-public information (although it may be sensitive and proprietary) with respect to Borrower or its securities for purposes of United States Federal and state securities laws (provided that, to the extent such Borrower Materials constitute confidential information subject to Section 14.14, they shall be treated as set forth in Section 14.14); (iv) all Borrower Materials marked “PUBLIC” are permitted to be made available through a portion of the Platform designated “Public Investor”; and
(v)Administrative Agent and the Arranger shall be entitled to treat any Borrower Materials that are not marked “PUBLIC” as being suitable only for posting on a portion of the Platform not designated “Public Investor.”
Section 8.2 Business of Credit Parties. The primary business of the Credit Parties will continue to be the acquisition, ownership, maintenance and selling, leasing or otherwise disposing of Mineral Interests; provided that, for the avoidance of doubt, neither Borrower nor any of its Restricted Subsidiaries operates, explores or develops Mineral Interests; provided, further that the foregoing proviso shall not be construed to prohibit actions incidental to any such Person’s ownership of non-operated working interests.
Section 8.3 Maintenance of Existence. Borrower shall, and shall cause each of the other Credit Parties to, at all times (a) maintain its corporate, partnership or limited liability company
existence (as applicable) in its state of organization, and (b) maintain its good standing and qualification to transact business in all jurisdictions where the failure to maintain good standing or
qualification to transact business could reasonably be expected to have a Material Adverse Effect; provided that, the foregoing shall not prohibit any merger, consolidation, liquidation or dissolution permitted under Section 9.4.
Section 8.4 Right of Inspection; Books and Records.
(a) Borrower will permit, and will cause each other Credit Party to permit, any officer, employee or agent of Administrative Agent or any Bank to visit and inspect any of the assets of any Credit Party, examine each Credit Party’s books of record and accounts, take copies and extracts therefrom, and discuss the affairs, finances and accounts of each Credit Party with any of such Credit Party’s officers, accountants and auditors, all upon reasonable advance notice and at such reasonable times and as often as Administrative Agent or any Bank may desire, all at the expense of Borrower; provided that, (i) any inspection by any Bank shall be coordinated through and together with Administrative Agent and (ii) prior to the occurrence of an Event of Default, neither Administrative Agent nor any Bank will require any Credit Party to incur any unreasonable expense as a result of the exercise by Administrative Agent or any Bank of its rights pursuant to this Section 8.4.
(b) Borrower will, and will cause each other Credit Party to, maintain proper books of record and account, in which full, true and correct entries in conformity with GAAP consistently applied shall be made of all financial transactions and matters involving the assets and business of Borrower or such other Credit Party, as the case may be.
Section 8.5 Maintenance of Insurance. Borrower will, and will cause each other Credit Party to, at all times maintain or cause to be maintained (a) all insurance policies (including self- insurance where appropriate) sufficient for the compliance by each of them with all material Laws and all material agreements and (b) insurance coverage in at least amounts and against such risk (including, without limitation, public liability) that are customarily insured against by companies similarly situated and engaged in the same or a similar business for the assets and operations of Borrower and its Restricted Subsidiaries. All lender loss payable clauses or provisions in all policies of insurance maintained by the Credit Parties pursuant to this Section 8.5 shall be endorsed in favor of and made payable to Administrative Agent for the ratable benefit of Banks, as their interests may appear. Administrative Agent shall be named an additional insured with respect to all of the Credit Parties’ liability policies to the extent permitted by Law. Whenever an Event of Default has occurred and is continuing, Administrative Agent for the ratable benefit of Banks shall have the right to collect, and Borrower hereby assigns to Administrative Agent for the ratable benefit of Banks, any and all monies that may become payable under any such policies of property and casualty insurance by reason of damage, loss or destruction of any property which stands as security for the Obligations or any part thereof, and Administrative Agent may, at its election (which election shall be made in the reasonable discretion of Administrative Agent with the consent of Majority Banks), either apply for the ratable benefit of Banks all or any part of the sums so collected toward payment of the Obligations (or the portion thereof with respect to which such property stands as security), whether or not such Obligations are then due and payable, in such manner as Administrative Agent may elect or release same to Borrower.
Section 8.6 Payment of Obligations. Borrower will, and will cause each other Credit Party to, pay and discharge as the same shall become due and payable, all its material obligations
and liabilities, including (a) all material Taxes imposed upon it or any of its assets or with respect to any of its franchises, business, income or profits, unless the same are being contested in good faith by appropriate proceedings diligently conducted and adequate reserves in accordance with GAAP are being maintained by the applicable Credit Party, (b) all material claims (including claims for labor, services, materials and supplies) for sums which have become due and payable and which by Law have or might become a Lien (other than a Permitted Encumbrance) on any of its assets, and (c) all Debt, as and when due and payable, but subject to any subordination provisions contained in any instrument or agreement evidencing such Debt.
Section 8.7 Compliance with Laws and Documents. Borrower will, and will cause each other Credit Party to, comply with all Laws, its articles or certificate of incorporation, certificate of limited partnership, partnership agreement, bylaws, regulations and similar organizational documents and all Material Agreements to which any Credit Party is a party, if a violation, alone or when combined with all other such violations, could reasonably be expected to have a Material Adverse Effect. Each Credit Party will maintain in effect and enforce policies and procedures designed to achieve compliance by such Credit Party, its Subsidiaries and their respective directors, officers, employees and agents with applicable Anti-Corruption Laws and applicable Sanctions.
Section 8.8 Maintenance of Properties and Equipment.
(a)Borrower will, and will cause each other Credit Party to, maintain, preserve and keep its Borrowing Base Properties, and observe and comply with all of the terms and provisions, express or implied, of all oil and gas leases relating to such properties so long as such oil and gas leases are capable of producing Hydrocarbons and accompanying elements in paying quantities, to the extent that the failure to so observe and comply could reasonably be expected to have a Material Adverse Effect.
(b)Borrower will, and will cause each other Credit Party to, comply in all respects with all contracts and agreements applicable to or relating to its Borrowing Base Properties or the production and sale of Hydrocarbons and accompanying elements therefrom, except to the extent a failure to so comply could not reasonably be expected to have a Material Adverse Effect.
(c)With respect to the Borrowing Base Properties of any Credit Party which are operated by operators other than such Credit Party, no Credit Party shall be obligated itself to perform any undertakings contemplated by the covenants and agreements contained in this Section
8.8 which are performable only by such operators and are beyond the control of such Credit Party, but shall be obligated to seek to enforce such operators’ material contractual obligations to maintain, develop and operate the Borrowing Base Properties in accordance with such operating agreements.
Section 8.9 Further Assurances. Borrower will, and will cause each other Credit Party to, execute and deliver or cause to be executed and delivered such other and further instruments or documents and take such further action as in the judgment of Administrative Agent may be required to carry out the provisions and purposes of the Loan Papers, including to create, preserve,
protect and perfect the Liens of Administrative Agent for the ratable benefit of the Banks and other holders of Obligations as required by Article V.
Section 8.10 Environmental Law Compliance and Indemnity. (a) Borrower will, and will cause each other Credit Party to, comply with all Applicable Environmental Laws, including
(i) all licensing, permitting, notification and similar requirements of Applicable Environmental Laws, and (ii) all provisions of Applicable Environmental Law regarding storage, discharge, release, transportation, treatment and disposal of Hazardous Substances, except in each case where the failure to comply could not reasonably be expected to have a Material Adverse Effect. Borrower will, and will cause each other Credit Party to, promptly pay and discharge when due all debts, claims, liabilities and obligations with respect to any clean-up or remediation measures necessary to comply in all material respects with Applicable Environmental Laws. Borrower hereby indemnifies and agrees to defend and hold Banks and their successors and assigns harmless from and against any and all claims, demands, causes of action, loss, damage, liabilities, costs and expenses (including reasonable attorneys’ fees and court costs) of any and every kind or character, known or unknown, fixed or contingent, asserted against or incurred by any Bank at any time and from time to time, including those asserted or arising subsequent to the payment or other satisfaction of the Loans, by reason of or arising out of the ownership, construction, occupancy, operation, use and maintenance of any of the collateral for the Loans, including matters arising out of the negligence of any Bank; provided that, this indemnity shall not apply with respect to matters caused by or arising out of (A) with respect to each Bank, the gross negligence or willful misconduct of such Bank, as determined by a court of competent jurisdiction in a final, non- appealable judgment (IT BEING THE EXPRESS INTENTION HEREBY THAT BANKS SHALL BE INDEMNIFIED FROM THE CONSEQUENCES OF THEIR ORDINARY NEGLIGENCE); and (B) the construction, occupancy, operation, use and maintenance of the collateral for the Loans by any owner, lessee or party in possession of the collateral for the Loans subsequent to the ownership of the collateral for the Loans by Borrower; provided further that, this subclause (B) shall not exclude from the foregoing indemnity and agreement, liability, claims, demands, causes of action, loss, damage, costs and expenses imposed by reason of the ownership of the collateral for the Loans by Banks after purchase by Banks at any foreclosure sale or transfer in lieu thereof from any Credit Party in partial or entire satisfaction of the Loans (unless the same shall be solely attributable to the subsequent use of the collateral by Banks during their ownership thereof). The foregoing indemnity and agreement applies to the violation of any Applicable Environmental Law prior to the payment or other satisfaction of the Loans and any act, omission, event or circumstance existing or occurring on or about the collateral for the Loans (including the presence on the collateral for the Loans or release from the collateral for the Loans of asbestos or other Hazardous Substances disposed of or otherwise present in or released prior to the payment or other satisfaction of the Loans). It shall not be a defense to the covenant of Borrower to indemnify that the act, omission, event or circumstance did not constitute a violation of any Applicable Environmental Law at the time of its existence or occurrence. The provisions of this Section 8.10 shall survive the repayment of the Loans and shall continue thereafter in full force and effect. In the event of the transfer of the Loans or any portion thereof, Banks or any prior holder of the Loans and any participants shall continue to be benefited by this indemnity and agreement with respect to the period of such holding of the Loans.
(b) With respect to the Borrowing Base Properties of any Credit Party which are operated by operators other than such Credit Party, no Credit Party shall be obligated
itself to perform any undertakings contemplated by the covenants and agreements contained in this Section 8.10 which are performable only by such operators and are beyond the control of such Credit Party, but shall be obligated to seek to enforce such operators’ material contractual obligations to maintain, develop and operate the Borrowing Base Properties in accordance with such operating agreements.
Section 8.11 ERISA Reporting Requirements. Borrower will promptly furnish and will cause the other Credit Parties and any ERISA Affiliate to promptly furnish to Administrative Agent (i) promptly upon request from the Administrative Agent, copies of the most recent annual and other reports with respect to each Plan or any trust created thereunder, and (ii) promptly upon becoming aware of the occurrence of any “prohibited transaction,” as described in section 406 of ERISA or in section 4975 of the Code, in connection with any Plan or any trust created thereunder, a written notice signed by the chief executive officer or the chief financial officer of the Credit Party or the ERISA Affiliate, as the case may be, specifying the nature thereof, what action Borrower, such Credit Party or ERISA Affiliate is taking or proposes to take with respect thereto, and, when known, any action taken or proposed by the Internal Revenue Service or the Department of Labor with respect thereto.
Section 8.12 Commodity Exchange Act Keepwell Provisions.
(a)Borrower hereby absolutely, unconditionally and irrevocably undertakes to provide such funds or other support as may be needed from time to time by each Benefitting Guarantor in order for such Benefitting Guarantor to honor its obligations under the Facility Guaranty and any other Loan Paper with respect to Hedge Transactions (provided, however, that Borrower shall only be liable under this Section 8.12(a) for the maximum amount of such liability that can be hereby incurred without rendering their obligations under this Section 8.12(a), or otherwise under this Agreement or any Loan Paper, as it relates to such Benefitting Guarantor, voidable under applicable law relating to fraudulent conveyance or fraudulent transfer, and not for any greater amount). The obligations of Borrower under this Section 8.12(a) shall remain in full force and effect until all Obligations are paid in full to Banks, Administrative Agent and all other Secured Parties to whom Obligations are owing, and all of Banks’ Commitments are terminated. Borrower intends that this Section 8.12(a) constitute, and this Section 8.12(a) shall be deemed to constitute, a “keepwell, support, or other agreement” for the benefit of each Benefitting Guarantor for all purposes of Section 1a(18)(A)(v)(II) of the Commodity Exchange Act.
(b)Notwithstanding any other provisions of this Agreement or any other Loan Paper, the Obligations guaranteed by any Guarantor, or secured by the grant of any Lien by such Guarantor under any Loan Paper, shall exclude all Excluded Swap Obligations with respect to such Guarantor.
Section 8.13 Unrestricted Subsidiaries. Borrower:
(a)will cause the management, business and affairs of Borrower and each of its Restricted Subsidiaries to be conducted in such a manner (including by keeping separate books of account, furnishing separate financial statements of Unrestricted Subsidiaries to creditors and potential creditors thereof and by not permitting Properties of Borrower and its respective Restricted Subsidiaries to be commingled) so that each Unrestricted Subsidiary that is a
corporation will be treated as a corporate entity separate and distinct from Borrower and its Restricted Subsidiaries;
(b)will not, and will not permit any of the Restricted Subsidiaries to, incur, assume, guarantee or be or become liable for any Debt of any of the Unrestricted Subsidiaries; and
(c)will not permit any Unrestricted Subsidiary to hold any Equity Interest in, or any Debt of, Borrower or any Restricted Subsidiary.
Section 8.14 Deposit Accounts; Commodity Accounts and Securities Accounts. Borrower and each Guarantor will cause each of their respective Deposit Accounts, Commodity Accounts or Securities Accounts (in each case, other than De Minimis Accounts) to at all times be subject to an Account Control Agreement in accordance with and to the extent required by the Security Agreement.
Section 8.15 Post-Closing Delivery of Account Control Agreements. Notwithstanding the requirements set forth in Section 8.14, with respect to each Deposit Account, Commodity Account and Securities Account of the Credit Parties in existence on the Effective Date (other than, in each case, De Minimis Accounts), Borrower and each Restricted Subsidiary shall, no later than thirty (30) days after the Effective Date (or such later date as Administrative Agent may agree in its sole discretion), deliver to Administrative Agent duly executed Account Control Agreements in accordance with and to the extent required by the Security Agreement.
ARTICLE IX NEGATIVE COVENANTS
Borrower agrees that, so long as any Bank has any commitment to lend or participate in Letter of Credit Exposure hereunder or any Loan or any other amount payable under any Note remains unpaid or any Letter of Credit remains outstanding:
Section 9.1 Debt. Borrower will not, nor will Borrower permit any other Credit Party to, incur, become or remain liable for any Debt other than:
(a) | the Obligations; |
(b) | Debt of any Credit Party to any other Credit Party; |
(c)Debt constituting a Guarantee by any Credit Party of any Debt of one or more other Credit Parties that is permitted under this Section 9.1;
(d)Debt under Capital Leases or that constitutes Purchase Money Debt; provided that the aggregate principal amount of all Debt described in this Section 9.1(d) at any one time outstanding shall not exceed $10,000,000 in the aggregate;
(e)other Debt of any Credit Party; provided that: (i) such Debt shall solely be comprised of unsecured senior or unsecured senior subordinated Debt, (ii) such Debt shall not
provide for any amortization of principal or any scheduled principal prepayments on any date prior to 180 days after the Maturity Date in effect at the time of incurrence or issuance, (iii) such Debt
shall not contain a scheduled maturity date that is earlier than 180 days after the Maturity Date in effect at the time of incurrence or issuance, (iv) such Debt (or the documents governing such Debt) shall not contain (A) any financial maintenance covenant that is more restrictive or onerous with respect to Borrower and its Restricted Subsidiaries than any financial maintenance covenant in this Agreement (as determined in good faith by senior management of Borrower), (B) covenants (other than financial maintenance covenants) or events of default, taken as a whole, that are more restrictive or onerous with respect to Borrower and its Restricted Subsidiaries than the covenants (other than financial maintenance covenants) and events of default in this Agreement (as determined in good faith by senior management of Borrower), (C) restrictions on the ability of Borrower or any of its Restricted Subsidiaries to guarantee the Obligations or to pledge assets as collateral security for the Obligations, (D) any mandatory prepayment or Redemption provisions which would require a mandatory prepayment or Redemption of such Debt (other than provisions requiring Redemption or offers to Redeem in connection with asset sales or a “change in control”) or (E) any prohibition on the prior repayment of any Obligations, (v) after giving effect to the incurrence or issuance of such Debt, the application of the proceeds thereof, and any automatic reduction of the Borrowing Base pursuant to Section 4.7 on account thereof and on the date of such incurrence or issuance of such Debt: (A) Borrower shall be in pro forma compliance with Section 10.1(a) and Section 10.1(b), in each case, for the Rolling Period most recently ended for which financial statements are available and (B) no Event of Default shall exist and (vi) the Borrowing Base shall automatically be reduced on the date of the incurrence or issuance of such Debt in accordance with Section 4.7; and
(f)other Debt in an amount not to exceed at any time outstanding $10,000,000 in the aggregate.
Section 9.2 Restricted Payments and Redemptions of Permitted Additional Debt.
(a)Restricted Payments. Borrower will not, nor will Borrower permit any other Credit Party to, declare, pay or make, or incur any liability to declare, pay or make, any Restricted Payment, except that, (i) Borrower may declare and pay dividends with respect to its Equity Interests payable solely in additional shares of such Equity Interests (other than Disqualified Capital Stock), (ii) Restricted Subsidiaries may make Restricted Payments ratably with respect to their Equity Interests, (iii) Borrower may make Permitted Tax Distributions; provided that if the aggregate Permitted Tax Distributions for any tax year exceed the actual annual tax amount for such year (based on the calculation in the definition of Permitted Tax Distribution), such excess shall be deducted from the next distribution(s) to occur after such U.S. federal income tax filing, and (iv) Borrower may make Restricted Payments with respect to its Equity Interests so long as no Default or Event of Default or Borrowing Base Deficiency then exists or would result therefrom.
(b)Redemptions of Permitted Additional Debt. Borrower will not, nor will permit any other Credit Party to, call, make or offer to make any optional or voluntary Redemption of, or otherwise optionally or voluntarily Redeem (whether in whole or in part), any Permitted Additional Debt, provided, that Borrower may convert Permitted Additional Debt into Equity Interests in Borrower (other than Disqualified Capital Stock) and Borrower or any other Credit Party may otherwise voluntarily Redeem Permitted Additional Debt (i) with net proceeds from any incurrence of Permitted Additional Debt so long as such Redemption occurs substantially
contemporaneously with the receipt of such net proceeds and in an amount no greater than the amount of the net proceeds of such incurrence of Permitted Additional Debt that remain after giving effect to any mandatory prepayments hereunder with such proceeds and (ii) with net proceeds of an offering of Equity Interests (other than Disqualified Capital Stock) or new cash contributions from the holders of Borrower’s Equity Interests so long as (A) no Default or Event of Default then exists or would result therefrom and (B) such Redemption occurs within 45 days after the receipt of such equity net proceeds.
Section 9.3 Liens; Negative Pledge. Borrower will not, nor will Borrower permit any other Credit Party to, create, assume or suffer to exist any Lien on any Credit Party’s Properties (now owned or hereafter acquired) other than Permitted Encumbrances. Borrower will not, nor will Borrower permit any other Credit Party to, enter into or become subject to any agreement that prohibits or otherwise restricts the right of any Credit Party to create, assume or suffer to exist any Lien in favor of Administrative Agent on any Credit Party’s Property other than agreements with respect to Permitted Encumbrances described in clauses (e), (h), (i), (j), (k) and (m) of the definition of such term but only to the extent such agreements apply to the Property subject to such Permitted Encumbrances.
Section 9.4 Consolidations and Mergers. Borrower will not, nor will Borrower permit any other Credit Party to, divide, consolidate or merge with or into any other Person; provided that, so long as no Event of Default exists or will result therefrom, (a) any Credit Party may merge or consolidate with, or be liquidated or dissolved into, Borrower (provided that Borrower shall be the surviving entity of such merger or consolidation), (b) any Credit Party (other than Borrower) may merge or consolidate with, or be liquidated or dissolved into, any other Credit Party, and (c) any Person may merge or consolidate with or into any Credit Party; provided that, in the case of this clause (c), (i) such Credit Party shall be the surviving entity of such merger or consolidation and (ii) such merger or consolidation shall (A) be deemed to be an Investment by such Credit Party in such Person in the form of an acquisition of Equity Interests in such Person and (B) otherwise be permitted by Section 9.7.
Section 9.5 Asset Dispositions. Borrower will not, nor will Borrower permit any other Credit Party to, make any Asset Disposition (including, in each case, as a result of the designation of any Restricted Subsidiary as an Unrestricted Subsidiary in accordance with Section 9.11) to any Person other than a Credit Party or to sell, lease, transfer, abandon or otherwise dispose of (other than by means of a transfer to a Credit Party) any equipment affixed to or located on the lands subject to any Borrowing Base Property, unless:
(a)in the case of any such disposition of equipment and fixtures, such equipment and fixtures are (i) disposed of in connection with a release, surrender or abandonment of a well or Mineral Interest, (ii) sold, leased, transferred, or otherwise disposed of as part of a sale, lease, transfer or other disposition of associated Mineral Interests that is permitted hereunder,
(iii)obsolete or otherwise not useful for their intended purpose and disposed of in the ordinary course of business, or (iv) replaced by articles of comparable suitability owned by any Credit Party, free and clear of all Liens except Permitted Encumbrances; and
(b)in the case of any such Asset Disposition, (i) all mandatory prepayments required by Section 2.6 in connection with such Asset Disposition (after giving effect to any
automatic reduction in the Borrowing Base pursuant to Section 4.6) are made in accordance with Section 2.6, and (ii) Borrower or other applicable Credit Party shall, no later than 30 days following the closing of such Asset Disposition, novate, unwind or terminate Oil and Gas Hedge Transactions to the extent, if any, needed to comply with Section 9.10.
In addition, Borrower will not make, or permit any other Credit Party to make, any Asset Disposition consisting of (i) the sale, assignment, lease, transfer, exchange or other disposition by any Credit Party of any Equity Interest in any Restricted Subsidiary or (ii) the issuance by any Restricted Subsidiary that owns any Borrowing Base Property of any of its Equity Interests, if in either case the aggregate, consolidated Equity Interests of the Credit Parties in such Restricted Subsidiary will be reduced as a result of such transaction. Notwithstanding the foregoing to the contrary, if any Properties are transferred (by merger or otherwise) from one Credit Party to another Credit Party in any Asset Disposition or other transfer of Property permitted hereunder, such transferred Properties shall be subject in each case to the requirements set forth in Article V.
Section 9.6 Use of Proceeds. The proceeds of Borrowings will not be used for any purpose other than to finance the acquisition of Mineral Interests, to reimburse third parties for exploration and development costs incurred in respect of Borrower and its Restricted Subsidiaries’ Mineral Interests, for working capital and general company purposes, and to pay fees and expenses incurred in connection with the transactions contemplated hereby. None of the proceeds of the Loans or any Letter of Credit issued hereunder will be used, directly or indirectly, (a) for the purpose, whether immediate, incidental or ultimate, of purchasing or carrying any Margin Stock, or (b) in violation of applicable Law (including the Margin Regulations or any Sanctions), and Borrower shall not use, and Borrower shall not procure that any of its Subsidiaries and its and their respective directors, officers, employees and agents shall use, the proceeds of any Borrowing or Letter of Credit (i) for the purpose of making an offer, payment, promise to pay, or authorization of the payment or giving of money, or anything else of value, to any Person in violation of any Anti-Corruption Laws, or (ii) for the purpose of funding, financing or facilitating any activities, business or transaction of or with any Sanctioned Person, or in any Sanctioned Country. No Letters of Credit will be issued hereunder for the purpose of or providing credit enhancement with respect to any Debt or equity security of any Credit Party or to secure any Credit Party’s obligations with respect to Hedge Transactions.
Section 9.7 Investments. Borrower will not, nor will Borrower permit any other Credit Party to, directly or indirectly, make any Investment other than Permitted Investments.
Section 9.8 Transactions with Affiliates. Borrower will not, nor will Borrower permit any other Credit Party to, engage in any material transaction with any of their Affiliates (other than transactions among the Credit Parties) or any portfolio company Controlled by a Sponsor unless such transaction is generally as favorable to such Credit Party as could be obtained in an arm’s length transaction with an Person not an Affiliate or otherwise Controlled by a Sponsor in accordance with prevailing industry customs and practices. Notwithstanding the foregoing, the restrictions set forth in this Section 9.8 shall not apply to (a) executing, delivering and performing obligations under the Loan Papers, (b) compensation to, and the terms of employment contracts with, individuals who are officers, managers or directors of any Credit Party, provided such compensation or contract is approved by Parent’s board of directors, (c) the issuance of Equity
Interests (other than Disqualified Capital Stock) by Borrower and (d) payments made pursuant to Section 9.2 or otherwise expressly permitted under this Agreement.
Section 9.9 ERISA. Except as could not reasonably be expected to have a Material Adverse Effect, Borrower will not, and will not permit any Credit Party to, at any time:
(a)engage in, or permit any ERISA Affiliate to engage in, any transaction in connection with which Borrower, any other Credit Party or any ERISA Affiliate could be subjected to either a civil penalty assessed pursuant to subsections (c), (i), (l) or (m) of section 502 of ERISA or a tax imposed by Chapter 43 of Subtitle D of the Code;
(b)fail to make, or permit any ERISA Affiliate to fail to make, full payment when due of all amounts which, under the provisions of any Plan, agreement relating thereto or applicable law, Borrower, any other Credit Party or any ERISA Affiliate is required to pay as contributions thereto; and
(c)contribute to or assume an obligation to contribute to, or permit any ERISA Affiliate to contribute to or assume an obligation to contribute to (i) any employee welfare benefit plan, as defined in section 3(1) of ERISA, including any such plan maintained to provide benefits to former employees of such entities, that may not be terminated by such entities in their sole discretion at any time without any material liability, or (ii) any employee pension benefit plan, as defined in section 3(2) of ERISA, that is subject to Title IV of ERISA, section 302 of ERISA or section 412 of the Code.
Section 9.10 Hedge Transactions.
(a)Borrower will not, nor will Borrower permit any other Credit Party to, enter into any Oil and Gas Hedge Transactions (i) with a duration longer than five years after the end of the month during which the applicable Oil and Gas Hedge Transaction is entered into, (ii) with any Person other than a Person that is an Approved Counterparty at the time such Oil and Gas Hedge Transaction is entered into, or (iii) the notional volumes for which (when aggregated or netted, as appropriate, with other Oil and Gas Hedge Transactions then in effect other than basis differential swaps on volumes already hedged pursuant to other Hedge Agreements) exceed, as of the date such Oil and Gas Hedge Transaction is entered into, 85% of the reasonably anticipated projected production (as such production is projected in the most recent Reserve Report delivered pursuant to the terms of this Agreement and otherwise determined as described in Section 9.10(g)) attributable to Borrower’s and its Restricted Subsidiaries’ Proved Mineral Interests for each month during the period of such Oil and Gas Hedge Transaction.
(b)If, after the end of any calendar quarter, Borrower determines that the aggregate weighted average of the notional volumes of all Oil and Gas Hedge Transactions for such calendar quarter (other than basis differential swaps on volumes already hedged pursuant to other Oil and Gas Hedge Transactions) exceeded 100% of actual production of Hydrocarbons attributable to Borrower’s and its Restricted Subsidiaries’ Proved Producing Mineral Interests in such calendar quarter, then Borrower (i) shall promptly notify Administrative Agent of such determination and (ii) shall, no later than 30 days after such notice, terminate (only to the extent such terminations are permitted pursuant to Section 9.5), create off-setting positions, or otherwise
unwind or monetize (only to the extent such unwinds or monetizations are permitted pursuant to Section 9.5) existing Oil and Gas Hedge Transactions such that, at such time, future hedging volumes will not exceed 100% of reasonably anticipated projected production attributable to Borrower’s and its Restricted Subsidiaries’ Proved Producing Mineral Interests for the then- current and any succeeding calendar quarters.
(c)Borrower will not, nor will Borrower permit any other Credit Party to, enter into or permit to exist any Hedge Transactions with respect to interest rates other than (i) Hedge Transactions effectively converting interest rates from floating to fixed, the notional amounts of which (when aggregated with all other Hedge Transactions of Borrower and its Restricted Subsidiaries then in effect effectively converting interest rates from floating to fixed) do not exceed 75% of the then outstanding principal amount of the Credit Parties’ consolidated Debt for borrowed money which bears interest at a floating rate, and (ii) Hedge Transactions that have the effect of unwinding or reducing, in whole or in part, Hedge Transactions permitted under the preceding clause (i).
(d)Borrower will not, nor will Borrower permit any other Credit Party to, enter into any commodity, interest rate, currency or other swap, option, collar or other derivative transaction pursuant to which any Credit Party speculates on the movement of commodity prices, securities prices, interest rates, financial markets, currency markets or other items; provided that, nothing contained in this Section 9.10(d) shall prohibit any Credit Party from (i) entering into Hedge Transactions otherwise permitted by this Section 9.10, or (ii) making Permitted Investments.
(e)Borrower will not, and will not permit any Restricted Subsidiary to, terminate or monetize any Oil and Gas Hedge Transaction except to the extent such terminations are permitted pursuant to Section 9.5.
(f)In no event shall any Hedge Agreement contain any requirement, agreement or covenant for Borrower or any Restricted Subsidiary to post collateral or margin to secure their obligations under such Hedge Agreement other than pursuant to the Loan Papers.
(g)For purposes of entering into, maintaining or adjusting Hedge Agreements or Hedge Transactions under Section 9.10(a) and Section 9.10(b), respectively, forecasts of reasonably anticipated production attributable to Borrower’s and its Restricted Subsidiaries’ Proved Mineral Interests as set forth on the most recent Reserve Report delivered pursuant to the terms of this Agreement shall be revised to account for any increase or decrease in forecasted production that is anticipated because of information obtained by Borrower or any of its Restricted Subsidiaries subsequent to the publication of such Reserve Report including forecasts of production decline rates for existing xxxxx received by any Credit Party from the applicable operators of the oil and gas properties comprising the Credit Party’s Mineral Interests and additions to or deletions from anticipated future production from new xxxxx and completed acquisitions coming on stream or failing to come on stream.
(h)Notwithstanding anything to the contrary contained in this Agreement, Borrower will not, and will not permit any Restricted Subsidiary to, enter into any Hedge Agreement unless Borrower is a Qualified ECP Guarantor at such time.
Section 9.11 Designation and Conversion of Restricted and Unrestricted Subsidiaries; Foreign Subsidiaries.
(a)Unless designated as an Unrestricted Subsidiary on Schedule 3 as of the Effective Date or designated hereafter in compliance with Section 9.11(b), any Person that becomes a Subsidiary of Borrower or any of its Restricted Subsidiaries shall be classified as a Restricted Subsidiary. Except for any merger, consolidation, liquidation or dissolution of a Subsidiary in accordance with Section 9.4 or the sale of a Subsidiary permitted by Section 9.5, all Restricted Subsidiaries shall at all times be, directly or indirectly, wholly-owned Subsidiaries of Borrower.
(b)Borrower may designate by written notification thereof to Administrative Agent, any Restricted Subsidiary, including a newly formed or newly acquired Domestic Subsidiary, as an Unrestricted Subsidiary if (i) immediately before and immediately after giving effect to such designation, neither an Event of Default nor a Borrowing Base Deficiency would exist, (ii) such designation is deemed to be an Investment in an Unrestricted Subsidiary in an amount equal to the fair market value as of the date of such designation of Borrower’s direct and indirect ownership interest in such Domestic Subsidiary and such Investment would be permitted to be made at the time of such designation under Section 9.7, (iii) such designation is deemed to be an Asset Disposition to the extent such Domestic Subsidiary owns Proved Mineral Interests and
(iv)such Domestic Subsidiary is not a “restricted subsidiary” or guarantor with respect to any Permitted Additional Debt. Except as provided in this Section 9.11(b), no Restricted Subsidiary may be redesignated as an Unrestricted Subsidiary.
(c)Borrower may designate any Unrestricted Subsidiary to be a Restricted Subsidiary if after giving effect to such designation, (i) the representations and warranties of Borrower and its Restricted Subsidiaries contained in each of the Loan Papers are true and correct in all material respects on and as of such date as if made on and as of the date of such redesignation (or, if stated to have been made expressly as of an earlier date, were true and correct in all material respects as of such date), (ii) no Event of Default would exist and (iii) Borrower complies with the requirements of Section 5.4 and Section 8.13.
(d) | Neither Borrower nor any Restricted Subsidiary will have any Foreign |
Subsidiaries.
Section 9.12 Amendments to Permitted Additional Debt Documents. Without the prior written consent of Administrative Agent, Borrower will not, and will not permit any Credit Party to, prior to the date that is 180 days after the Maturity Date, amend, modify, waive or otherwise change, or consent or agree to any amendment, modification, waiver or other change to, any of the terms of the Permitted Additional Debt Documents if the effect thereof would result in such Debt being not permitted under Section 9.1(e) as if such Debt had been incurred concurrently with such amendment, modification, waiver or other change.
Section 9.13 Holding Company. Borrower shall not directly own any interest in any Proved Mineral Interests of the Credit Parties. Any Proved Mineral Interests of the Credit Parties will at all times be owned by one or more Restricted Subsidiaries.
ARTICLE X FINANCIAL COVENANTS
Section 10.1 Financial Covenants. Borrower agrees that, so long as any Bank has any commitment to lend or participate in Letter of Credit Exposure hereunder or any Loans or any other amount payable under any Note remains unpaid or any Letter of Credit remains outstanding:
(a)As of the last day of any Fiscal Quarter, commencing with the last day of the Fiscal Quarter ending June 30, 2019, Borrower will not permit its Current Ratio to be less than
1.00 to 1.00; and
(b)As of the last day of any Fiscal Quarter, commencing with the last day of the Fiscal Quarter ending June 30, 2019, Borrower will not permit the ratio of (i) Total Net Funded Debt as of such date to (ii) Consolidated EBITDA (or, in the case of the Rolling Periods ending on the last day of the Fiscal Quarters ending June 30, 2019, September 30, 2019 and December 31, 2019, Annualized EBITDA) for the Rolling Period then ending to be greater than 4.00 to 1.00.
ARTICLE XI DEFAULTS
Section 11.1 Events of Default. If one or more of the following events (collectively “Events of Default” and individually an “Event of Default”) shall have occurred and be continuing:
(a)Borrower shall fail to pay when due any principal of any Loan or any reimbursement obligation with respect to any Letters of Credit when due;
(b)Borrower shall fail to pay any accrued interest due and owing on any Loan or any fees or any other amount payable hereunder when due and such failure shall continue for a period of five (5) Business Days following the due date;
(c)any Credit Party shall fail to observe or perform any covenant or agreement applicable thereto contained in Section 4.4, Section 8.1(e), Section 8.3(a), Section 8.5, Section 8.14, Section 8.15, Article IX, or Section 10.1;
(d)any Credit Party shall fail to observe or perform any covenant or agreement contained in this Agreement or the other Loan Papers (other than those covered by Section 11.1(a), Section 11.1(b) and Section 11.1(c)) and such failure continues for a period of 30 days after the earlier of (i) the date any Authorized Officer of any Credit Party acquires knowledge of such failure, or (ii) written notice thereof has been given to any such Credit Party by Administrative Agent at the request of any Bank;
(e)any representation, warranty, certification or statement made or deemed to have been made by any Credit Party in this Agreement or by any Credit Party or any other Person on behalf of any Credit Party in any other Loan Paper shall prove to have been incorrect in any material respect when made, deemed made, or confirmed;
(f)(i) any Credit Party shall fail to make any payment when due on any Material Debt, or any event or condition (A) shall occur which results in the acceleration of the
maturity of any Material Debt of any such Credit Party, or (B) shall occur which entitles (or, with the giving of notice or lapse of time or both, would unless cured or waived, entitle) the holder of such Material Debt to accelerate the maturity thereof; or (ii) there occurs under any Hedge Agreement an Early Termination Date (as defined in such Hedge Agreement if applicable), or such Hedge Agreement is otherwise terminated prior to the scheduled term of the applicable transaction, in each case, resulting from (1) any event of default under such Hedge Agreement as to which any Credit Party is the defaulting party or (2) any Termination Event (as defined in such Hedge Agreement, if applicable) under such Hedge Agreement as to which any Credit Party is an Affected Party (as so defined, if applicable) and, in either event, the net hedging obligation owed by such Credit Party as a result thereof is greater than the Threshold Amount;
(g)any Credit Party shall commence a voluntary case or other proceeding seeking liquidation, reorganization or other relief with respect to itself or its debts under any bankruptcy, insolvency or other similar Law now or hereafter in effect or seeking the appointment of a trustee, receiver, liquidator, custodian or other similar official of it or any substantial part of its property, or shall consent to any such relief or to the appointment of or taking possession by any such official in an involuntary case or other proceeding commenced against it, or shall make a general assignment for the benefit of creditors, or shall become unable, admit in writing its inability or fail generally to pay its debts as they become due, or shall take any corporate or partnership action to authorize any of the foregoing;
(h)an involuntary case or other proceeding shall be commenced against any Credit Party seeking liquidation, reorganization or other relief with respect to it or its debts under any bankruptcy, insolvency or other similar Law now or hereafter in effect or seeking the appointment of a trustee, receiver, liquidator, custodian or other similar official of it or any substantial part of its property, and such involuntary case or other proceeding shall remain undismissed and unstayed for a period of 60 days; or an order for relief shall be entered against any Credit Party under the federal bankruptcy Laws as now or hereafter in effect;
(i)one (1) or more judgments or orders for the payment of money aggregating in excess of the Threshold Amount (to the extent not covered by independent third party insurance provided by insurers of the highest claims paying rating or financial strength as to which the insurer does not dispute coverage and is not subject to an insolvency proceeding) shall be rendered against any Credit Party and such judgment or order (i) shall continue unsatisfied and unstayed (unless bonded with a supersedeas bond at least equal to such judgment or order) for a period of 60 days, or (ii) is not fully paid and satisfied at least 10 days prior to the date on which any of its assets may be lawfully sold to satisfy such judgment or order;
(j)this Agreement or any other Loan Paper shall cease to be in full force and effect or shall be declared null and void or the validity or enforceability thereof shall be contested or challenged by any Credit Party, or any Credit Party shall deny that it has any further liability or obligation under any of the Loan Papers, or any Lien created by the Loan Papers shall for any reason (other than by reason of the operation of Law or pursuant to the terms of the Loan Papers or the express release thereof by a written instrument executed by Administrative Agent in accordance with the Loan Papers) cease to be a valid, first priority, perfected Lien (other than Permitted
Encumbrances) upon any of the property purported to be covered thereby having a fair market value, individually or in the aggregate, greater than $1,000,000; or
(k) | a Change of Control shall occur; |
then, and in every such event, Administrative Agent shall without presentment, notice or demand (unless expressly provided for herein) of any kind (including notice of intention to accelerate and acceleration), all of which are hereby waived, (i) if requested by Majority Banks, terminate the Commitments and they shall thereupon terminate, and (ii) if requested by Majority Banks, take such other actions as may be permitted by the Loan Papers including, declaring the Loans, or any of them, (together with accrued interest thereon) to be, and the Loans, or any of them, shall thereupon become, immediately due and payable; provided that (iii) in the case of any of the Events of Default specified in Section 11.1(g) or Section 11.1(h), without any notice to Borrower or any other Credit Party or any other act by Administrative Agent or Banks, the Commitments shall thereupon terminate and the Loans (together with accrued interest thereon) shall become immediately due and payable.
ARTICLE XII AGENTS
Section 12.1 Appointment and Authorization of Administrative Agent; Secured Hedge Transactions.
(a)Each Bank hereby irrevocably (subject to Section 12.10) appoints, designates and authorizes Administrative Agent to take such action on its behalf under the provisions of this Agreement and each other Loan Paper and to exercise such powers and perform such duties as are expressly delegated to it by the terms of this Agreement or any other Loan Paper, together with such powers as are reasonably incidental thereto. Notwithstanding any provision to the contrary contained elsewhere herein or in any other Loan Paper, Administrative Agent shall not have any duties or responsibilities, except those expressly set forth herein, nor shall Administrative Agent have or be deemed to have any fiduciary relationship with any Bank or participant, and no implied covenants, functions, responsibilities, duties, obligations or liabilities shall be read into this Agreement or any other Loan Paper or otherwise exist against Administrative Agent. Without limiting the generality of the foregoing sentence, the use of the term “agent” herein and in the other Loan Papers with reference to Administrative Agent, any syndication agent or documentation agent is not intended to connote any fiduciary or other implied (or express) obligations arising under agency doctrine of any applicable law. Instead, such term is used merely as a matter of market custom, and is intended to create or reflect only an administrative relationship between independent contracting parties.
(b)Each Letter of Credit Issuer shall act on behalf of Banks with respect to any Letters of Credit issued by it and the documents associated therewith until such time (and except for so long) as Administrative Agent may agree at the request of the Majority Banks to act for such Letter of Credit Issuer with respect thereto; provided, however, that each Letter of Credit Issuer shall have all of the benefits and immunities (i) provided to Administrative Agent in this Article XII with respect to any acts taken or omissions suffered by a Letter of Credit Issuer in connection with Letters of Credit issued by it or proposed to be issued by it and the application and agreements for letters of credit pertaining to the Letters of Credit as fully as if the term “Administrative Agent” as used in this Article XII included each Letter of Credit Issuer with
respect to such acts or omissions, and (ii) as additionally provided herein with respect to each Letter of Credit Issuer.
Section 12.2 Delegation of Duties. Administrative Agent may execute any of its duties under this Agreement or any other Loan Paper by or through agents, sub-agents, employees or attorneys in fact and shall be entitled to advice of counsel and other consultants or experts concerning all matters pertaining to such duties. Administrative Agent shall not be responsible for the negligence or misconduct of any agent or attorney in fact that it selects in the absence of gross negligence or willful misconduct.
Section 12.3 Default; Collateral.
(a)Upon the occurrence and continuance of a Default or Event of Default, Banks agree to promptly confer in order that Majority Banks, Required Banks or Banks, as the case may
be, may agree upon a course of action for the enforcement of the rights of Banks; and Administrative Agent shall be entitled to refrain from taking any action (without incurring any liability to any Person for so refraining) unless and until Administrative Agent shall have received instructions from Majority Banks, Required Banks or Banks, as the case may be. All rights of action under the Loan Papers and all right to the collateral under the Loan Papers, if any, hereunder may be enforced by Administrative Agent and any suit or proceeding instituted by Administrative Agent in furtherance of such enforcement shall be brought in its name as Administrative Agent without the necessity of joining as plaintiffs or defendants any other Secured Party, and the recovery of any judgment shall be for the benefit of the Secured Parties subject to the expenses of Administrative Agent. In actions with respect to any property of Borrower or any other Credit Party, Administrative Agent is acting for the ratable benefit of each Secured Party as provided in the Loan Papers. Any and all agreements to subordinate (whether made heretofore or hereafter) other indebtedness or obligations of Borrower to the Obligations shall be construed as being for the ratable benefit of each Secured Party as provided in the Loan Papers.
(b)Each Secured Party authorizes and directs Administrative Agent to enter into the other Loan Papers on behalf of and for the benefit of such Secured Party (or if previously entered into, hereby ratifies Administrative Agent’s previously entering into such agreements and other Loan Papers).
(c)Except to the extent unanimity (or other percentage set forth in Section 14.2) is required hereunder, each Bank agrees that any action taken by Majority Banks or Required Banks, as the case may be, in accordance with the provisions of the Loan Papers, and the exercise by Majority Banks or Required Banks, as the case may be, of the power set forth herein or therein, together with such other powers as are reasonably incidental thereto, shall be authorized and binding upon all of Banks.
(d)Administrative Agent is hereby authorized on behalf of the Secured Parties, without the necessity of any notice to or further consent from any Secured Party, from time to time to take any action with respect to any collateral under the Loan Papers or any Loan Papers which may be necessary to perfect and maintain perfected the Liens upon such collateral granted pursuant to the other Loan Papers.
(e)Administrative Agent shall not have any obligation whatsoever to any Secured Party or to any other Person to assure that such collateral exists or is owned by the Person purporting to own it or is cared for, protected, or insured or has been encumbered or that the Liens granted to Administrative Agent herein or pursuant thereto have been properly or sufficiently or lawfully created, perfected, protected, or enforced, or are entitled to any particular priority, or to exercise at all or in any particular manner or under any duty of care, disclosure, or fidelity, or to continue exercising, any of the rights granted or available to Administrative Agent in this Section
12.3 or in any of the other Loan Papers; IT BEING UNDERSTOOD AND AGREED THAT IN RESPECT OF THE COLLATERAL UNDER THE LOAN PAPERS, OR ANY ACT, OMISSION, OR EVENT RELATED THERETO, ADMINISTRATIVE AGENT MAY (AS BETWEEN ADMINISTRATIVE AGENT AND THE SECURED PARTIES) ACT IN ANY MANNER IT MAY DEEM APPROPRIATE, IN ITS SOLE DISCRETION, GIVEN ADMINISTRATIVE AGENT’S OWN INTEREST IN SUCH COLLATERAL AS ONE OF THE SECURED PARTIES AND THAT ADMINISTRATIVE AGENT SHALL HAVE NO DUTY OR LIABILITY WHATSOEVER TO ANY SECURED PARTY OTHER THAN TO ACT WITHOUT GROSS NEGLIGENCE OR WILLFUL MISCONDUCT.
(f)In furtherance of the authorizations set forth in this Section 12.3, each Secured Party hereby irrevocably appoints Administrative Agent as its attorney-in-fact, with full power of substitution, for and on behalf of and in the name of each such Secured Party (i) to enter into the other Loan Papers (including any appointments of substitute trustees under any such Loan Papers), (ii) to take action with respect to the other Loan Papers and the collateral thereunder to perfect, maintain, and preserve Administrative Agent’s Liens, and (iii) to execute instruments of release or to take other action necessary to release Liens upon any such collateral to the extent authorized in Section 12.14. This power of attorney shall be liberally, not restrictively, construed so as to give the greatest latitude to Administrative Agent’s power, as attorney, relative to the matters described in this Section 12.3 relating to collateral. The powers and authorities herein conferred on Administrative Agent may be exercised by Administrative Agent through any Person who, at the time of the execution of a particular instrument, is an officer of Administrative Agent (or any Person acting on behalf of Administrative Agent pursuant to a valid power of attorney). The power of attorney conferred by this Section 12.3(f) to Administrative Agent is granted for valuable consideration and is coupled with an interest and is irrevocable so long as the Obligations, or any part thereof, shall remain unpaid or the Banks are obligated to make any Loan or issue any Letter of Credit under the Loan Papers.
Section 12.4 Liability of Administrative Agent. NO INDEMNIFIED ENTITY OF ADMINISTRATIVE AGENT SHALL (a) BE LIABLE TO ANY SECURED PARTY FOR ANY ACTION TAKEN OR OMITTED TO BE TAKEN BY ANY OF THEM UNDER OR IN CONNECTION WITH THIS AGREEMENT OR ANY OTHER LOAN PAPER OR THE TRANSACTIONS CONTEMPLATED HEREBY (EXCEPT FOR ITS OWN GROSS NEGLIGENCE OR WILLFUL MISCONDUCT IN CONNECTION WITH ITS DUTIES
EXPRESSLY SET FORTH HEREIN), or (b) be responsible in any manner to any Secured Party or participant for any recital, statement, representation or warranty made by Borrower or any other Credit Party or any officer thereof, contained herein or in any other Loan Paper, or in any certificate, report, statement or other document referred to or provided for in, or received by Administrative
Agent under or in connection with, this Agreement or any other Loan Paper, or the validity, effectiveness, genuineness, enforceability or sufficiency of this Agreement or any other
Loan Paper, or for the creation, perfection or priority of any Liens purported to be created by any of the Loan Papers, or the validity, genuineness, enforceability, existence, value or sufficiency of any collateral security, or to make any inquiry respecting the performance by Borrower of its obligations hereunder or under any other Loan Paper, or for any failure of Borrower or other Credit Party or any other party to any Credit Party to perform its obligations hereunder or thereunder. No Indemnified Entity of Administrative Agent shall be under any obligation to any Secured Party or participant to ascertain or to inquire as to the observance or performance of any of the agreements contained in, or conditions of, this Agreement or any other Loan Paper, or to inspect the properties, books or records of Borrower or any other Credit Party or any Affiliate thereof.
Section 12.5 Reliance by Administrative Agent.
(a)Administrative Agent shall be entitled to rely, and shall be fully protected in relying, upon any writing, communication, signature, resolution, representation, notice, consent, certificate, affidavit, letter, telegram, facsimile, electronic mail, or telephone message, statement or other document or conversation believed by it to be genuine and correct and to have been signed, sent or made by the proper Person or Persons, and upon advice and statements of legal counsel (including counsel to Borrower or any other Credit Party), independent accountants and other experts selected by Administrative Agent. Administrative Agent shall be fully justified in failing or refusing to take any action under any Loan Paper unless it shall first receive such advice or concurrence of the requisite Majority Banks, Required Banks, or all Banks, as applicable, as it deems appropriate and, if it so requests, it shall first be indemnified to its satisfaction by Banks against any and all liability and expense which may be incurred by it by reason of taking or continuing to take any such action. Administrative Agent shall in all cases be fully protected in acting, or in refraining from acting, under this Agreement or any other Loan Paper in accordance with a request or consent of the requisite Majority Banks, Required Banks, or all Banks, as applicable, and such request and any action taken or failure to act pursuant thereto shall be binding upon all Banks and participants. Where this Agreement expressly permits or prohibits an action unless the requisite Majority Banks or Required Banks otherwise determine, Administrative Agent shall, and in all other instances, Administrative Agent may, but shall not be required to, initiate any solicitation for the consent or a vote of the requisite Banks.
(b)For purposes of determining compliance with the conditions specified in Section 6.1, each Bank that has funded its Applicable Percentage of the initial Loan on the Effective Date (or, if there is no Loan made on such date, each Bank other than Banks who gave written objection to Administrative Agent prior to such date) shall be deemed to have consented to, approved or accepted or to be satisfied with, each document or other matter either sent by Administrative Agent to such Bank (or otherwise made available for such Bank on SyndTrak Online, DXSyndicate™ or any similar website) for consent, approval, acceptance or satisfaction, or required hereunder to be consented to or approved by or acceptable or satisfactory to a Bank.
Section 12.6 Notice of Default. Administrative Agent shall not be deemed to have knowledge or notice of the occurrence of any Default or Event of Default, except with respect to defaults in the payment of principal, interest and fees required to be paid to Administrative Agent for the account of Banks, unless Administrative Agent shall have received written notice from a Bank or Borrower
referring to this Agreement, describing such Default or Event of Default and stating that such notice is a “notice of default.” Administrative Agent will notify Banks of its
receipt of any such notice. Administrative Agent shall take such action with respect to such Default or Event of Default as may be directed by the Majority Banks or Required Banks, as applicable, in accordance with this Agreement; provided, however, that unless and until Administrative Agent has received any such direction, Administrative Agent may (but shall not be obligated to) take such action, or refrain from taking such action, with respect to such Default or Event of Default as it shall deem advisable or in the best interest of Banks.
Section 12.7 Credit Decision; Disclosure of Information by Administrative Agent. Each Bank acknowledges that no Indemnified Entity of Administrative Agent has made any representation or warranty to it, and that no act by Administrative Agent hereinafter taken, including any consent to and acceptance of any assignment or review of the affairs of Borrower or any other Credit Party or any Affiliate thereof, shall be deemed to constitute any representation or warranty by any Indemnified Entity of Administrative Agent to any Bank as to any matter, including whether Indemnified Entities of Administrative Agent have disclosed material information in their possession. Each Bank represents to Administrative Agent that it has, independently and without reliance upon any Indemnified Entity of Administrative Agent and based on such documents and information as it has deemed appropriate, made its own appraisal of and investigation into the business, prospects, operations, property, financial and other condition and creditworthiness of Borrower and each other Credit Party, and all applicable bank or other regulatory laws relating to the transactions contemplated hereby, and made its own decision to enter into this Agreement and to extend credit to Borrower hereunder. Each Bank also represents that it will, independently and without reliance upon any Indemnified Entity of Administrative Agent and based on such documents and information as it shall deem appropriate at the time, continue to make its own credit analysis, appraisals and decisions in taking or not taking action under this Agreement and the other Loan Papers, and to make such investigations as it deems necessary to inform itself as to the business, prospects, operations, property, financial and other condition and creditworthiness of Borrower and the other Credit Parties. In this regard, each Bank acknowledges that Xxxxxx & Xxxxxx L.L.P. is acting in this transaction as counsel to Administrative Agent. Each other party hereto will consult with its own legal counsel to the extent that it deems necessary in connection with the Loan Papers and the matters contemplated therein. Except for notices, reports and other documents expressly required to be furnished to Banks by Administrative Agent herein, Administrative Agent shall not have any duty or responsibility to provide any Bank with any credit or other information concerning the business, prospects, operations, property, financial and other condition or creditworthiness of any of the Credit Parties or any of their respective Affiliates which may come into the possession of any Indemnified Entity of Administrative Agent.
Section 12.8 Indemnification of Agents. WHETHER OR NOT THE TRANSACTIONS CONTEMPLATED HEREBY ARE CONSUMMATED, BANKS SHALL INDEMNIFY UPON DEMAND EACH INDEMNIFIED ENTITY OF ADMINISTRATIVE AGENT (TO THE EXTENT NOT REIMBURSED BY OR ON BEHALF OF BORROWER AND WITHOUT LIMITING THE OBLIGATION OF BORROWER TO DO SO), IN ACCORDANCE WITH THEIR RESPECTIVE APPLICABLE PERCENTAGES, AND HOLD HARMLESS EACH INDEMNIFIED ENTITY OF ADMINISTRATIVE AGENT FROM AND AGAINST ANY AND ALL INDEMNIFIED LIABILITIES INCURRED BY IT (INCLUDING SUCH INDEMNIFIED ENTITY OF ADMINISTRATIVE AGENT’S OWN NEGLIGENCE); PROVIDED, HOWEVER, THAT NO BANK SHALL BE LIABLE FOR THE PAYMENT TO ANY INDEMNIFIED
ENTITY OF ADMINISTRATIVE AGENT OF ANY PORTION OF SUCH INDEMNIFIED LIABILITIES RESULTING FROM SUCH PERSON’S GROSS NEGLIGENCE OR WILLFUL
MISCONDUCT; provided, however, that no action taken in accordance with the directions of the Required Banks or Majority Banks, as applicable, shall be deemed to constitute gross negligence or willful misconduct for purposes of this Section 12.8. Without limitation of the foregoing, each Bank shall reimburse Administrative Agent upon demand for its ratable share of any costs or out- of-pocket expenses (including counsel fees) incurred by Administrative Agent in connection with the preparation, execution, delivery, administration, modification, amendment or enforcement (whether through negotiations, legal proceedings or otherwise) of, or legal advice in respect of rights or responsibilities under, this Agreement, any other Loan Paper, or any document contemplated by or referred to herein, to the extent that Administrative Agent is not reimbursed for such expenses by or on behalf of Borrower. The undertaking in this Section 12.8 shall survive termination of the Commitments, the payment of all Obligations hereunder and the resignation or replacement of Administrative Agent.
Section 12.9 Administrative Agent in its Individual Capacity. Xxxxx Fargo Bank, N.A. and its Affiliates may make loans to, accept deposits from, acquire Equity Interests in and generally engage in any kind of banking, trust, financial advisory, underwriting or other business with Borrower and its Affiliates as though Xxxxx Fargo Bank, N.A. were not Administrative Agent or the Letter of Credit Issuer hereunder and without notice to or consent of Banks. Banks acknowledge that, pursuant to such activities, Xxxxx Fargo Bank, N.A. or its Affiliates may receive information regarding Borrower or its Affiliates (including information that may be subject to confidentiality obligations in favor of Borrower or such Affiliate) and acknowledge that Administrative Agent shall be under no obligation to provide such information to them. With respect to its Loans, Xxxxx Fargo Bank, N.A. shall have the same rights and powers under this Agreement as any other Bank and may exercise such rights and powers as though it were not Administrative Agent or the Letter of Credit Issuer, and the terms “Bank” and “Banks” include Xxxxx Fargo Bank, N.A. in its individual capacity.
Section 12.10 Successor Administrative Agent and Letter of Credit Issuer. Administrative Agent or the Letter of Credit Issuer may, subject to the acceptance of the appointment of a successor as provided herein, resign at any time upon 30 days’ notice to Banks with a copy of such notice to Borrower. Upon any such notice by Administrative Agent or the Letter of Credit Issuer, the Majority Banks shall, with the consent of Borrower at all times other than during the existence of an Event of Default (which consent of Borrower shall not be unreasonably withheld, delayed or conditioned) appoint from among Banks a successor administrative agent or letter of credit issuer. If no successor administrative agent or letter of credit issuer has both been appointed by the Majority Banks and accepted within 30 days after the retiring Administrative Agent’s or Letter of Credit Issuer’s notice of resignation, Administrative Agent may appoint a successor administrative agent and/or letter of credit issuer which shall (a) be a commercial bank organized under the Laws of the United States of America or of any State thereof and having a combined capital surplus of at least $500,000,000 and (b) unless the successor administrative agent and/or letter of credit issuer is a Bank, be reasonably acceptable to Borrower. Upon the acceptance of its appointment as successor administrative agent and/or letter of credit issuer hereunder, (x) such successor administrative agent and/or letter of credit issuer shall succeed to all the rights, powers and duties of the retiring Administrative Agent or Letter of Credit Issuer, (y) the terms “Administrative Agent” and “Letter of Credit Issuer” shall respectively mean such successor administrative agent
and letter of credit issuer, and (z) the retiring Administrative Agent’s or Letter of Credit Issuer’s appointment, powers and duties as Administrative Agent or Letter of Credit Issuer shall be terminated. The retiring Letter of Credit Issuer shall remain the Letter of Credit Issuer with respect to any Letters of Credit outstanding on the effective date of its resignation and the provisions affecting such Letter of Credit Issuer with respect to Letters of Credit shall inure to the benefit of the resigning Letter of Credit Issuer until the termination of all such Letters of Credit. After any retiring Administrative Agent’s resignation hereunder as Administrative Agent, the provisions of this Article XII and Sections 14.3 and 14.5 shall inure to its benefit as to any actions taken or omitted to be taken by it while it was Administrative Agent under this Agreement.
Section 12.11 Syndication Agent; Other Agents; Arranger. None of the Banks or other Persons identified on the facing page or signature pages of this Agreement as a “syndication agent,” as a “documentation agent,” any other type of agent (other than Administrative Agent), “arranger,” or “bookrunner” shall have any right, power, obligation, liability, responsibility or duty under this Agreement other than those applicable to all Banks as such. Without limiting the foregoing, none of Banks so identified shall have or be deemed to have any fiduciary relationship with any Bank. Each Bank acknowledges that it has not relied, and will not rely, on any of Banks so identified in deciding to enter into this Agreement or in taking or not taking action hereunder.
Section 12.12 Administrative Agent May File Proof of Claim. In case of the pendency of any receivership, insolvency, liquidation, bankruptcy, reorganization, arrangement, adjustment, composition or other judicial proceeding relative to Borrower or other Credit Party, Administrative Agent (irrespective of whether the principal of any Loan or Letter of Credit Exposure shall then be due and payable as herein expressed or by declaration or otherwise and irrespective of whether Administrative Agent shall have made any demand on Borrower) shall be entitled and empowered, by intervention in such proceeding or otherwise,
(a)to file and prove a claim for the whole amount of the principal and interest owing and unpaid in respect of the Loans, Letter of Credit Exposures and all other Obligations that are owing and unpaid and to file such other documents as may be necessary or advisable in order to have the claims of Banks, the Letter of Credit Issuer and Administrative Agent (including any claim for the reasonable compensation, expenses, disbursements and advances of Banks, the Letter of Credit Issuer and Administrative Agent and their respective agents and counsel and all other amounts due Banks, Letter of Credit Issuers and Administrative Agent under Section 14.3) allowed in such judicial proceeding; and
(b)to collect and receive any monies or other property payable or deliverable on any such claims and to distribute the same;
and any custodian, receiver, assignee, trustee, liquidator, sequestrator or other similar official in any such judicial proceeding is hereby authorized by each Bank and the Letter of Credit Issuer to make such payments to Administrative Agent and, in the event that Administrative Agent shall consent to the making of such payments directly to Banks and the Letter of Credit Issuer, to pay to Administrative Agent any amount due for the reasonable compensation, expenses, disbursements and advances of Administrative Agent and its agents and counsel, and any other amounts due Administrative Agent under Section 14.3.
Nothing contained herein shall be deemed to authorize Administrative Agent to authorize or consent to or accept or adopt on behalf of any Bank or the Letter of Credit Issuer any plan of reorganization, arrangement, adjustment or composition affecting the Obligations or the rights of any Bank or to authorize Administrative Agent to vote in respect of the claim of any Bank in any such proceeding.
Section 12.13 Secured Hedge Transactions. To the extent any Approved Counterparty is a party to a Hedge Transaction with Borrower or other Credit Party and thereby becomes a Secured Hedge Provider and a beneficiary of the Liens pursuant to any Loan Paper, such Secured Hedge Provider shall be deemed to appoint Administrative Agent its nominee and agent to act for and on behalf of such Affiliate in connection with such Loan Papers and to be bound by the terms of this Article XII, and the other provisions of this Agreement.
Section 12.14 Collateral and Guaranty Matters.
(a)Each Bank and the Letter of Credit Issuer hereby authorizes Administrative Agent to take the following actions and Administrative Agent hereby agrees to take such actions at the request of Borrower:
(i) to release any Lien on any Property granted to or held by Administrative Agent under any Loan Papers (x) upon (A) termination of all Commitments and payment in full of all Obligations (other than contingent indemnification obligations) owing under the Loan Papers to Administrative Agent, the Banks and (unless the Letter of Credit Issuer has advised Administrative Agent that the Obligations owing to it are otherwise adequately provided for) the Letter of Credit Issuer and owing to any Secured Hedge Provider under any Obligation with respect to a Hedge Transaction (other than a Secured Hedge Provider that has advised Administrative Agent that the Obligations owing to it are otherwise adequately provided for or novated), and (B) termination of all Hedge Transactions with Secured Hedge Providers (other than any Secured Hedge Provider that has advised Administrative Agent that such Hedge Transactions are otherwise adequately provided for or novated), (y) that is, or is to be, sold, released or otherwise disposed of as permitted pursuant to the terms of the Loan Papers, or (z) if approved, authorized or ratified in writing by Majority Banks (or, if approval, authorization or ratification by all Banks is required with respect to the release or substitution of all or substantially all of the collateral for the Obligations pursuant to Section 14.2(c), then by all Banks);
(ii) to release any Guarantor from its obligations under the Loan Papers if such Person ceases to be a Restricted Subsidiary as a result of a transaction permitted under the Loan Papers; and
(iii) to execute and deliver to Borrower, at Borrower’s sole cost and expense, any and all releases of Liens, guaranty releases, termination statements, assignments or other documents necessary or useful to accomplish or evidence the foregoing.
(b)Upon the request of Administrative Agent at any time, Majority Banks will confirm in writing Administrative Agent’s authority to release particular types or items of Collateral pursuant to this Section 12.14.
(c)Notwithstanding anything contained in any of the Loan Papers to the contrary, no Person other than Administrative Agent has any individual right to realize upon any of the collateral subject to the Security Instruments or to enforce any Liens or remedies under the Security Instruments, and all powers, rights and remedies under the Security Instruments may be exercised solely by Administrative Agent on behalf of the Persons secured or otherwise benefitted thereby.
(d)By accepting the benefit of the Liens granted pursuant to the Security Instruments, each Person secured by such Liens that is not a party hereto agrees to the terms of this Section 12.14 and each Secured Hedge Provider consents to the grant by the Credit Parties to Administrative Agent of Liens on all Hedge Agreements and Hedge Transactions between such Secured Hedge Provider and any Credit Party.
ARTICLE XIII
PROTECTION OF YIELD; CHANGE IN LAWS
Section 13.1 Basis for Determining Interest Rate Applicable to Eurodollar Tranches Inadequate.
(a)Unless and until a Replacement Rate is implemented in accordance with Section 13.1(b), if the Majority Banks determine that for any reason in connection with any request for a Loan or a conversion to or continuation thereof that (i) dollar deposits are not being offered to banks in the London interbank eurodollar market for the applicable amount and Interest Period of such Loan, (ii) adequate and reasonable means do not exist for determining the Adjusted LIBO Rate or the LIBOR Rate, as applicable, for any requested Interest Period with respect to a proposed Eurodollar Loan or in connection with an Adjusted Base Rate Loan, or (iii) the Adjusted LIBO Rate or the LIBOR Rate, as applicable, for any requested Interest Period with respect to a proposed Eurodollar Loan or in connection with an Adjusted Base Rate Loan does not adequately and fairly reflect the cost to such Banks of funding such Loan, Administrative Agent will promptly so notify Borrower and each Bank. Thereafter, the obligation of Banks to make or maintain Eurodollar Loans and Adjusted Base Rate Loans as to which the interest rate is determined with reference to the LIBOR Rate or Adjusted LIBO Rate, as applicable, shall be suspended until Administrative Agent (upon the instruction of the Majority Banks) revokes such notice. Upon receipt of such notice, Borrower may revoke any pending request for a Borrowing of, conversion to or continuation of Eurodollar Loans or, failing that, will be deemed to have converted such request into a request for a Borrowing of Adjusted Base Rate Loans in the amount specified therein.
(b)Notwithstanding anything to the contrary in Section 13.1(a) above, if at any time Administrative Agent has made the determination (such determination to be conclusive absent manifest error) that (i) the circumstances described in Section 13.1(a)(i) or (a)(ii) have arisen and that such circumstances are unlikely to be temporary, (ii) any applicable interest rate specified herein is no longer a widely recognized benchmark rate for newly originated loans in the United States syndicated loan market in the applicable currency or (iii) the applicable supervisor or administrator (if any) of any applicable interest rate specified herein or any Governmental Authority having, or purporting to have, jurisdiction over Administrative Agent has made a public statement identifying a specific date after which any applicable interest rate specified herein shall
no longer be used for determining interest rates for loans in the United States syndicated loan market in the applicable currency, then Administrative Agent may, to the extent practicable (in consultation with Borrower and as determined by Administrative Agent to be generally in accordance with similar situations in other transactions in which it is serving as administrative agent or otherwise consistent with market practice generally), establish a replacement interest rate (the “Replacement Rate”), in which case, the Replacement Rate shall, subject to the next two sentences, replace such applicable interest rate for all purposes under the Loan Papers unless and until (A) an event described in Section 13.1(a)(i), (a)(ii), (b)(i), (b)(ii) or (b)(iii) occurs with respect to the Replacement Rate or (B) Administrative Agent (or the Majority Banks through Administrative Agent) notifies Borrower that the Replacement Rate does not adequately and fairly reflect the cost to the Banks of funding the Loans bearing interest at the Replacement Rate. In connection with the establishment and application of the Replacement Rate, this Agreement and the other Loan Papers shall be amended solely with the consent of Administrative Agent and Borrower, to give effect to such Replacement Rate, together with such administrative, technical or operational changes as may be necessary or appropriate, in the opinion of Administrative Agent, to effect the provisions of this Section 13.1(b). Notwithstanding anything to the contrary in this Agreement or the other Loan Papers (including, without limitation, Section 14.2), such amendment shall become effective without any further action or consent of any other party to this Agreement so long as Administrative Agent shall not have received, within five (5) Business Days of the delivery of such amendment to the Banks, written notices from such Banks that in the aggregate constitute Majority Banks, with each such notice stating that such Bank objects to such amendment (which such notice shall note with specificity the particular provisions of the amendment to which such Bank objects). To the extent the Replacement Rate is approved by Administrative Agent in connection with this clause (b), the Replacement Rate shall be applied in a manner consistent with market practice; provided that, in each case, to the extent such market practice is not administratively feasible for Administrative Agent, such Replacement Rate shall be applied as otherwise reasonably determined by Administrative Agent (it being understood that any such modification by Administrative Agent shall not require the consent of, or consultation with, any of the Banks).
Section 13.2 Illegality of Eurodollar Tranches.
(a)If, after the date of this Agreement, any Change in Law shall make it unlawful or impossible for any Bank (or its Eurodollar Lending Office) to make, maintain or fund any portion of the Loans subject to a Eurodollar Tranche and such Bank shall so notify Administrative Agent, Administrative Agent shall forthwith give notice thereof to the other Banks and Borrower. Until such Bank notifies Borrower and Administrative Agent that the circumstances giving rise to such suspension no longer exist, the obligation of such Bank to maintain or fund any portion of the Loans subject to a Eurodollar Tranche shall be suspended. Before giving any notice to Administrative Agent pursuant to this Section 13.2, such Bank shall designate a different Eurodollar Lending Office if such designation will avoid the need for giving such notice and will not, in the judgment of such Bank, be otherwise disadvantageous to such Bank. If such Bank shall determine that it may not lawfully continue to maintain and fund any portion of the Loans outstanding subject to a Eurodollar Tranche to maturity and shall so specify in such notice, Borrower shall immediately convert the principal amount of the Loans which is subject to a Eurodollar Tranche to an Adjusted Base Rate Tranche of an equal principal amount
from such Bank (on which interest and principal shall be payable contemporaneously with the unaffected Eurodollar Tranches of the other Banks).
(b)No Bank shall be required to make any Loan (or any portion thereof) hereunder if the making of such Loan (or any portion thereof) would be in violation of any Law applicable to such Bank.
Section 13.3 Increased Cost of Eurodollar Tranche.
(a) | (a) Increased Costs Generally. If any Change in Law shall: |
(i) impose, modify or deem applicable any reserve, special deposit, compulsory loan, insurance charge or similar requirement against assets of, deposits with or for the account of, or credit extended or participated in by, any Bank (except any reserve requirement reflected in the Adjusted LIBOR Rate) or the Letter of Credit Issuer;
(ii) subject any Recipient to any Taxes (other than (A) Indemnified Taxes and (B) Excluded Taxes) on its loans, loan principal, letters of credit, commitments, or other obligations, or its deposits, reserves, other liabilities or capital attributable thereto; or
(iii) impose on any Bank or the Letter of Credit Issuer or the London interbank market any other condition, cost or expense (other than Taxes) affecting this Agreement or Loans made by such Bank or any Letter of Credit or participation therein;
(b)and the result of any of the foregoing shall be to increase the cost to such Bank or such other Recipient of making, converting to, continuing or maintaining any Loan or of maintaining its obligation to make any such Loan, or to increase the cost to such Bank, the Letter of Credit Issuer or such other Recipient of participating in, issuing or maintaining any Letter of Credit (or of maintaining its obligation to participate in or to issue any Letter of Credit), or to reduce the amount of any sum received or receivable by such Bank, the Letter of Credit Issuer or other Recipient hereunder (whether of principal, interest or any other amount) then, upon request of such Bank, the Letter of Credit Issuer or other Recipient, Borrower will pay to such Bank, the Letter of Credit Issuer or other Recipient, as the case may be, such additional amount or amounts as will compensate such Bank, the Letter of Credit Issuer or other Recipient, as the case may be, for such additional costs incurred or reduction suffered.
(c)Capital Requirements. If any Bank or the Letter of Credit Issuer determines that any Change in Law affecting such Bank or the Letter of Credit Issuer or any lending office of such Bank or such Bank’s or the Letter of Credit Issuer’s holding company, if any, regarding capital or liquidity requirements, has or would have the effect of reducing the rate of return on such Bank’s or the Letter of Credit Issuer’s capital or on the capital of such Bank’s or the Letter of Credit Issuer’s holding company, if any, as a consequence of this Agreement, the Commitments of such Bank or the Loans made by, or participations in Letters of Credit, such Bank, or the Letters of Credit issued by the Letter of Credit Issuer, to a level below that which such Bank or the Letter of Credit Issuer or such Bank’s or the Letter of Credit Issuer’s holding company could have achieved but for such Change in Law (taking into consideration such Bank’s or the Letter of Credit Issuer’s policies and the policies of such Bank’s or the Letter of Credit Issuer’s holding company
with respect to capital adequacy), then from time to time Borrower will pay to such Bank or the Letter of Credit Issuer, as the case may be, such additional amount or amounts as will compensate such Bank or the Letter of Credit Issuer or such Bank’s or the Letter of Credit Issuer’s holding company for any such reduction suffered.
(d)Certificates for Reimbursement. A certificate of a Bank or the Letter of Credit Issuer setting forth the amount or amounts necessary to compensate such Bank or the Letter of Credit Issuer or its holding company, as the case may be, as specified in paragraph (a) or (b) of this Section and delivered to Borrower, shall be conclusive absent manifest error. Borrower shall pay such Bank or the Letter of Credit Issuer, as the case may be, the amount shown as due on any such certificate within 10 days after receipt thereof.
(e)Delay in Requests. Failure or delay on the part of any Bank or the Letter of Credit Issuer to demand compensation pursuant to this Section shall not constitute a waiver of such Bank’s or the Letter of Credit Issuer’s right to demand such compensation; provided that Borrower shall not be required to compensate a Bank or the Letter of Credit Issuer pursuant to this Section for any increased costs incurred or reductions suffered more than nine months prior to the date that such Bank or the Letter of Credit Issuer, as the case may be, notifies Borrower of the Change in Law giving rise to such increased costs or reductions, and of such Bank’s or the Letter of Credit Issuer’s intention to claim compensation therefor (except that, if the Change in Law giving rise to such increased costs or reductions is retroactive, then the nine-month period referred to above shall be extended to include the period of retroactive effect thereof).
Section 13.4 Adjusted Base Rate Tranche Substituted for Affected Eurodollar Tranche. If (a) the obligation of any Bank to fund or maintain any portion of any Loan subject to a Eurodollar Tranche has been suspended pursuant to Section 13.2, or (b) any Bank has demanded compensation under Section 13.3 and Borrower shall, by at least five (5) Eurodollar Business Days prior notice to such Bank through Administrative Agent, have elected that the provisions of this Section 13.4 shall apply to such Bank, then, unless and until such Bank notifies Borrower that the circumstances giving rise to such suspension or demand for compensation no longer apply:
(i) any Tranche which would otherwise be characterized by such Bank as a Eurodollar Tranche shall instead be deemed an Adjusted Base Rate Tranche (on which interest and principal shall be payable contemporaneously with the unaffected Eurodollar Tranches of the other Banks); and
(ii) after all of its Eurodollar Tranches have been repaid, all payments of principal which would otherwise be applied to repay Eurodollar Tranches shall be applied to repay its Adjusted Base Rate Tranches instead.
Section 13.5 Taxes.
(a)For purposes of this Section 13.5, the term “Bank” includes any Letter of Credit Issuer and the term “applicable law” includes FATCA.
(b)Any and all payments by or on account of any obligation of any Credit Party under any Loan Paper shall be made without deduction or withholding for any Taxes, except as
required by applicable law. If any applicable law (as determined in the good faith discretion of an applicable Withholding Agent) requires the deduction or withholding of any Tax from any such payment by a Withholding Agent, then the applicable Withholding Agent shall be entitled to make such deduction or withholding and shall timely pay the full amount deducted or withheld to the relevant Governmental Authority in accordance with applicable law and, if such Tax is an Indemnified Tax, then the sum payable by the applicable Credit Party shall be increased as necessary so that after such deduction or withholding has been made (including such deductions and withholdings applicable to additional sums payable under this Section) the applicable Recipient receives an amount equal to the sum it would have received had no such deduction or withholding been made.
(c)The Credit Parties shall timely pay to the relevant Governmental Authority in accordance with applicable law, or at the option of Administrative Agent timely reimburse it for the payment of, any Other Taxes.
(d)The Credit Parties shall jointly and severally indemnify each Recipient, within 10 days after demand therefor, for the full amount of any Indemnified Taxes (including Indemnified Taxes imposed or asserted on or attributable to amounts payable under this Section) payable or paid by such Recipient or required to be withheld or deducted from a payment to such Recipient and any reasonable expenses arising therefrom or with respect thereto, whether or not such Indemnified Taxes were correctly or legally imposed or asserted by the relevant Governmental Authority. A certificate as to the amount of such payment or liability delivered to Borrower by a Bank (with a copy to Administrative Agent), or by Administrative Agent on its own behalf or on behalf of a Bank, shall be conclusive absent manifest error.
(e)Each Bank shall severally indemnify Administrative Agent, within 10 days after demand therefor, for (i) any Indemnified Taxes attributable to such Bank (but only to the extent that any Credit Party has not already indemnified Administrative Agent for such Indemnified Taxes and without limiting the obligation of the Credit Parties to do so), (ii) any Taxes attributable to such Bank’s failure to comply with the provisions of Section 14.8(b) relating to the maintenance of a Participant Register and (iii) any Excluded Taxes attributable to such Bank, in each case, that are payable or paid by Administrative Agent in connection with any Loan Paper, and any reasonable expenses arising therefrom or with respect thereto, whether or not such Taxes were correctly or legally imposed or asserted by the relevant Governmental Authority. A certificate as to the amount of such payment or liability delivered to any Bank by Administrative Agent shall be conclusive absent manifest error. Each Bank hereby authorizes Administrative Agent to set off and apply any and all amounts at any time owing to such Bank under any Loan Paper or otherwise payable by Administrative Agent to such Bank from any other source against any amount due to Administrative Agent under this Section 13.5(e).
(f)As soon as practicable after any payment of Taxes by any Credit Party to a Governmental Authority pursuant to this Section 13.5, such Credit Party shall deliver to Administrative Agent the original or a certified copy of a receipt issued by such Governmental Authority evidencing such payment, a copy of the return reporting such payment or other evidence of such payment reasonably satisfactory to Administrative Agent.
(g)(i) Any Bank that is entitled to an exemption from or reduction of withholding Tax with respect to payments made under any Loan Paper shall deliver to Borrower and Administrative Agent, at the time or times reasonably requested by Borrower or Administrative Agent, such properly completed and executed documentation reasonably requested by Borrower or Administrative Agent as will permit such payments to be made without withholding or at a reduced rate of withholding. In addition, any Bank, if reasonably requested by Borrower or Administrative Agent, shall deliver such other documentation prescribed by applicable law or reasonably requested by Borrower or Administrative Agent as will enable Borrower or Administrative Agent to determine whether or not such Bank is subject to backup withholding or information reporting requirements. Notwithstanding anything to the contrary in the preceding two sentences, the completion, execution and submission of such documentation (other than such documentation set forth in Section 13.5(g)(ii)(A), (ii)(B) and (ii)(D) below) shall not be required if in Bank’s reasonable judgment such completion, execution or submission would subject such Bank to any material unreimbursed cost or expense or would materially prejudice the legal or commercial position of such Bank.
(ii) Without limiting the generality of the foregoing,
(A)any Bank that is a U.S. Person shall deliver to Borrower and Administrative Agent on or prior to the date on which such Bank becomes a Bank under this Agreement (and from time to time thereafter upon the reasonable request of Borrower or Administrative Agent), executed originals of IRS Form W-9 certifying that such Bank is exempt from U.S. federal backup withholding tax;
(B)any Foreign Bank shall, to the extent it is legally entitled to do so, deliver to Borrower and Administrative Agent (in such number of copies as shall be requested by the recipient) on or prior to the date on which such Foreign Bank becomes a Bank under this Agreement (and from time to time thereafter upon the reasonable request of Borrower or Administrative Agent), whichever of the following is applicable:
(i) in the case of a Foreign Bank claiming the benefits of an income tax treaty to which the United States is a party (x) with respect to payments of interest under any Loan Paper, executed originals of IRS Form W-8BEN-E, establishing an exemption from, or reduction of, U.S. federal withholding Tax pursuant to the “interest” article of such tax treaty and (y) with respect to any other applicable payments under any Loan Paper, IRS Form W-8BEN-E, establishing an exemption from, or reduction of, U.S. federal withholding Tax pursuant to the “business profits” or “other income” article of such tax treaty;
(ii) | executed originals of IRS Form W-8ECI; |
(iii) in the case of a Foreign Bank claiming the benefits of the exemption for portfolio interest under Section 881(c) of the Code, (x) a certificate substantially in the form of Exhibit I-1 to the effect that such Foreign Bank is not a “bank” within the meaning of Section 881(c)(3)(A) of the Code, a “10 percent shareholder” of Borrower within the meaning of Section 881(c)(3)(B) of the Code, or a “controlled
foreign corporation” described in Section 881(c)(3)(C) of the Code (a “U.S. Tax Compliance Certificate”) and (y) executed originals of IRS Form W-8BEN-E; or
(iv) to the extent a Foreign Bank is not the beneficial owner, executed originals of IRS Form W-8IMY, accompanied by IRS Form W-8ECI or IRS Form W-8BEN-E, as applicable, a U.S. Tax Compliance Certificate substantially in the form of Exhibit I-2 or Exhibit I-3, IRS Form W-9, and/or other certification documents from each beneficial owner, as applicable; provided that if the Foreign Bank is a partnership and one or more direct or indirect partners of such Foreign Bank are claiming the portfolio interest exemption, such Foreign Bank may provide a U.S. Tax Compliance Certificate substantially in the form of Exhibit I-4 on behalf of each such direct and indirect partner;
(C)any Foreign Bank shall, to the extent it is legally entitled to do so, deliver to Borrower and Administrative Agent (in such number of copies as shall be requested by the recipient) on or prior to the date on which such Foreign Bank becomes a Bank under this Agreement (and from time to time thereafter upon the reasonable request of Borrower or Administrative Agent), executed originals of any other form prescribed by applicable law as a basis for claiming exemption from or a reduction in U.S. federal withholding Tax, duly completed, together with such supplementary documentation as may be prescribed by applicable law to permit Borrower or Administrative Agent to determine the withholding or deduction required to be made; and
(D)if a payment made to a Bank under any Loan Paper would be subject to U.S. federal withholding Tax imposed by FATCA if such Bank were to fail to comply with the applicable reporting requirements of FATCA (including those contained in Section 1471(b) or 1472(b) of the Code, as applicable), such Bank shall deliver to Borrower and Administrative Agent at the time or times prescribed by law and at such time or times reasonably requested by Borrower or Administrative Agent such documentation prescribed by applicable law (including as prescribed by Section 1471(b)(3)(C)(i) of the Code) and such additional documentation reasonably requested by Borrower or Administrative Agent as may be necessary for Borrower and Administrative Agent to comply with their obligations under FATCA and to determine that such Bank has complied with such Bank’s obligations under FATCA or to determine the amount to deduct and withhold from such payment. Solely for purposes of this clause (D), “FATCA” shall include any amendments made to FATCA after the date of this Agreement.
(h)Each Bank agrees that if any form or certification it previously delivered expires or becomes obsolete or inaccurate in any respect, it shall update such form or certification or promptly notify Borrower and Administrative Agent in writing of its legal inability to do so.
(i)Treatment of Certain Refunds. If any party determines, in its sole discretion exercised in good faith, that it has received a refund of any Taxes as to which it has been indemnified pursuant to this Section 13.5 (including by the payment of additional amounts pursuant to this Section 13.5), it shall pay to the indemnifying party an amount equal to such refund (but only to the extent of indemnity payments made under this Section with respect to the Taxes giving rise to such refund), net of all out-of-pocket expenses (including Taxes) of such indemnified
party and without interest (other than any interest paid by the relevant Governmental Authority with respect to such refund). Such indemnifying party, upon the request of such indemnified party, shall repay to such indemnified party the amount paid over pursuant to this subsection (i) (plus any penalties, interest or other charges imposed by the relevant Governmental Authority) in the event that such indemnified party is required to repay such refund to such Governmental Authority. Notwithstanding anything to the contrary in this subsection (i), in no event will the indemnified party be required to pay any amount to an indemnifying party pursuant to this subsection (i) the payment of which would place the indemnified party in a less favorable net after-Tax position than the indemnified party would have been in if the Tax subject to indemnification and giving rise to such refund had not been deducted, withheld or otherwise imposed and the indemnification payments or additional amounts with respect to such Tax had never been paid. This subsection (i) shall not be construed to require any indemnified party to make available its Tax returns (or any other information relating to its Taxes that it deems confidential) to the indemnifying party or any other Person.
(j)Survival. Each party’s obligations under this Section 13.5 shall survive the resignation or replacement of Administrative Agent or any assignment of rights by, or the replacement of, a Bank, the termination of the Commitments and the repayment, satisfaction or discharge of all obligations under any Loan Paper.
Section 13.6 Discretion of Banks as to Manner of Funding. Notwithstanding any provisions of this Agreement to the contrary, each Bank shall be entitled to fund and maintain its funding of all or any part of its Commitment in any manner it sees fit, it being understood, however, that for the purposes of this Agreement all determinations hereunder shall be made as if such Bank had actually funded and maintained the Loans (or any portion thereof) subject to a Eurodollar Tranche during the Interest Period for the Loans (or any portion thereof) through the acceptance of deposits having a maturity corresponding to the last day of such Interest Period and bearing an interest rate equal to the LIBOR Rate for such Interest Period.
Section 13.7 Mitigation Obligations; Replacement of Banks.
(a)Designation of a Different Lending Office. If any Bank requests compensation under Section 13.3, or requires Borrower to pay any Indemnified Taxes or additional amounts to any Bank or any Governmental Authority for the account of any Bank pursuant to Section 13.5, then such Bank shall (at the request of Borrower) use reasonable efforts to designate a different lending office for funding or booking its Loans hereunder or to assign its rights and obligations hereunder to another of its offices, branches or affiliates, if, in the judgment of such Bank, such designation or assignment (x) would eliminate or reduce amounts payable pursuant to Section 13.3 or Section 13.5, as the case may be, in the future, and (y) would not subject such Bank to any unreimbursed cost or expense and would not otherwise be disadvantageous to such Bank. Borrower hereby agrees to pay all reasonable costs and expenses incurred by any Bank in connection with any such designation or assignment.
(b)Replacement of Banks. If (i) any Bank requests compensation under Section 13.3, (ii) the obligation of any Bank to make Eurodollar Loans or continue Loans as Eurodollar
Loans has been suspended pursuant to Section 13.4, (iii) Borrower is required to pay any Indemnified Taxes or additional amounts to any Bank or any Governmental Authority for the
account of any Bank pursuant to Section 13.5 and, in each case, such Bank has declined or is unable to designate a different lending office in accordance with Section 13.7(a), or (iv) any Bank is a Defaulting Bank or a Non-Consenting Bank, then Borrower may, at its sole expense and effort, upon notice to such Bank and Administrative Agent, require such Bank to assign and delegate, without recourse (in accordance with and subject to the restrictions contained in, and consents required by, Section 14.8), all of its interests, rights (other than its existing rights to payments pursuant to Section 13.3 or Section 13.5) and obligations under this Agreement and the related Loan Papers to an eligible assignee that shall assume such obligations (which assignee may be another Bank, if a Bank accepts such assignment); provided that:
(i) Borrower shall have paid to Administrative Agent the assignment fee (if any) specified in Section 14.8;
(ii) such Bank shall have received payment of an amount equal to the outstanding principal of its Loans and participations in Letter of Credit Exposure, accrued interest thereon, accrued fees and all other amounts payable to it hereunder and under the other Loan Papers (including any amounts under Section 3.3) from the assignee (to the extent of such outstanding principal and accrued interest and fees) or Borrower (in the case of all other amounts);
(iii) in the case of any such assignment resulting from a claim for compensation under Section 13.3 or payments required to be made pursuant to Section 13.5, such assignment will result in a reduction in such compensation or payments thereafter;
(iv) in the case of any such assignment resulting from the suspension of an obligation to make Eurodollar Loans or continue Loans as Eurodollar Loans under Section 13.4, such assignment will result in a resumption of such obligation in whole or in part;
(v) | such assignment does not conflict with applicable Law; and |
(vi) in the case of any assignment resulting from a Bank becoming a Non-Consenting Bank, the applicable assignee shall have consented to the applicable amendment, waiver or consent.
A Bank shall not be required to make any such assignment or delegation if, prior thereto, as a result of a waiver by such Bank or otherwise, the circumstances entitling Borrower to require such assignment and delegation cease to apply. Notwithstanding the foregoing, a Bank shall not be required to make any such assignment and delegation if such Bank is a Secured Hedge Provider with any outstanding Hedge Transaction with any Credit Party (to the extent obligations under such Hedge Transactions constitute Obligations), unless on or prior thereto, all such Hedge Transactions have been terminated or novated to another Person and such Bank (or its Affiliate) shall have received payment of all amounts, if any, payable to it in connection with such termination or novation. If any Bank refuses, pursuant to the previous sentence, to make any such assignment and delegation, such Bank shall give all reasonable cooperation to Borrower to effect such termination or novation of such Hedge Transactions.
ARTICLE XIV MISCELLANEOUS
Section 14.1 Notices; Effectiveness; Electronic Communications.
(a)Notices Generally. Except in the case of notices and other communications expressly permitted to be given by telephone (and except as provided in subsection (b) below), all notices and other communications provided for herein shall be in writing and shall be delivered by hand or overnight courier service, mailed by certified or registered mail or sent by telecopier as follows, and all notices and other communications expressly permitted hereunder to be given by telephone shall be made to the applicable telephone number, as follows:
(i) if to Borrower or any other Credit Party, to the address, telecopier number, electronic mail address or telephone number specified for such Person on the signature pages hereof; and
(ii) Administrative Agent, the Letter of Credit Issuer, or any Bank, to the address, telecopier number, electronic mail address or telephone number specified for such Person on Schedule 1 or in such Bank’s Administrative Questionnaire, as applicable.
Notices sent by hand or overnight courier service, or mailed by certified or registered mail, shall be deemed to have been given when received; notices sent by telecopier shall be deemed to have been given when sent (except that, if not given during normal business hours for the recipient, shall be deemed to have been given at the opening of business on the next business day for the recipient). Notices delivered through electronic communications to the extent provided in subsection (b) below shall be effective as provided in such subsection (b).
(b)Electronic Communications. Notices and other communications to Banks and the Letter of Credit Issuer hereunder may be delivered or furnished by electronic communication (including e-mail and Internet or intranet websites) pursuant to procedures approved by Administrative Agent, provided that the foregoing shall not apply to notices to any Bank or the Letter of Credit Issuer pursuant to Article II if such Bank or the Letter of Credit Issuer, as applicable, has notified Administrative Agent that it is incapable of receiving notices under such Article by electronic communication. Administrative Agent or Borrower may, in their discretion, agree to accept notices and other communications to them hereunder by electronic communications pursuant to procedures approved by them, provided that approval of such procedures may be limited to particular notices or communications. Unless Administrative Agent otherwise prescribes, (i) notices and other communications sent to an e-mail address shall be deemed received upon the sender’s receipt of an acknowledgement from the intended recipient (such as by the “return receipt requested” function, as available, return e-mail or other written acknowledgement), provided that if such notice or other communication is not sent during the normal business hours of the recipient, such notice or communication shall be deemed to have been sent at the opening of business on the next business day for the recipient, and (ii) notices or communications posted to an internet or intranet website shall be deemed received upon the deemed receipt by the intended recipient at its e-mail address as described in the foregoing clause
(i) of notification that such notice or communication is available and identifying the website address therefor.
(c)The Platform. THE PLATFORM IS PROVIDED “AS IS” AND “AS AVAILABLE.” THE AGENT PARTIES (AS DEFINED BELOW) DO NOT WARRANT THE ACCURACY OR COMPLETENESS OF THE BORROWER MATERIALS OR THE ADEQUACY OF THE PLATFORM, AND EXPRESSLY DISCLAIM LIABILITY FOR ERRORS IN OR OMISSIONS FROM THE BORROWER MATERIALS. NO WARRANTY OF ANY KIND, EXPRESS, IMPLIED OR STATUTORY, INCLUDING ANY WARRANTY OF MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE, NON- INFRINGEMENT OF THIRD PARTY RIGHTS OR FREEDOM FROM VIRUSES OR OTHER CODE DEFECTS, IS MADE BY ANY AGENT PARTY IN CONNECTION WITH THE BORROWER MATERIALS OR THE PLATFORM. In no event shall Administrative Agent or any of its Affiliates (collectively, the “Agent Parties”) have any liability to Borrower, any other Credit Party, any Bank, the Letter of Credit Issuer or any other Person for losses, claims, damages, liabilities or expenses of any kind (whether in tort, contract or otherwise) arising out of Borrower’s or Administrative Agent’s transmission of Borrower Materials through the Internet, except to the extent that such losses, claims, damages, liabilities or expenses are determined by a court of competent jurisdiction by a final and nonappealable judgment to have resulted from the gross negligence or willful misconduct of such Agent Party; provided that, in no event shall any Agent Party have any liability to Borrower, any other Credit Party, any Bank, the Letter of Credit Issuer or any other Person for indirect, special, incidental, consequential or punitive damages (as opposed to direct or actual damages).
(d)Change of Address, Etc. Borrower, each other Credit Party, Administrative Agent, and the Letter of Credit Issuer may change its address, telecopier, electronic mail address or telephone number for notices and other communications hereunder by written notice to the other parties hereto. Each other Bank may change its address, telecopier or telephone number for notices and other communications hereunder by written notice to Borrower, Administrative Agent, and the Letter of Credit Issuer. In addition, each Bank agrees to notify Administrative Agent from time to time to ensure that Administrative Agent has on record (i) an effective address, contact name, telephone number, telecopier number and electronic mail address to which notices and other communications may be sent and (ii) accurate wire instructions for such Bank. Furthermore, each Public Bank agrees to cause at least one individual at or on behalf of such Public Bank to at all times have selected the “Private Side Information” or similar designation on the content declaration screen of the Platform in order to enable such Public Bank or its delegate, in accordance with such Public Bank’s compliance procedures and applicable Law, including United States Federal and state securities Laws, to make reference to Borrower Materials that are not made available through the “Public Side Information” portion of the Platform and that may contain material non-public information with respect to Borrower or its securities for purposes of United States Federal or state securities laws.
(e)Reliance by Administrative Agent, Letter of Credit Issuer and Banks. Administrative Agent, the Letter of Credit Issuer and Banks shall be entitled to rely and act upon any notices (including telephonic Requests for Borrowing) purportedly given by or on behalf of Borrower even if (i) such notices were not made in a manner specified herein, were incomplete or were not preceded or followed by any other form of notice specified herein, or (ii) the terms thereof, as understood by the recipient, varied from any confirmation thereof. Borrower shall indemnify Administrative Agent, the Letter of Credit Issuer, each Bank and the Affiliates of each of them from all losses, costs, expenses and liabilities resulting from the reliance by such Person
on each notice purportedly given by or on behalf of Borrower. All telephonic notices to and other telephonic communications with Administrative Agent may be recorded by Administrative Agent, and each of the parties hereto hereby consents to such recording.
Section 14.2 Waivers and Amendments; Acknowledgments.
(a)No failure or delay (whether by course of conduct or otherwise) by any Bank or Administrative Agent in exercising any right, power or remedy which they may have under any of the Loan Papers shall operate as a waiver thereof or of any other right, power or remedy, nor shall any single or partial exercise by any Bank or Administrative Agent of any such right, power or remedy preclude any other or further exercise thereof or of any other right, power or remedy. No waiver of any provision of any Loan Paper and no consent to any departure therefrom shall ever be effective unless it is in writing and signed by Majority Banks and/or Administrative Agent in accordance with Section 14.2(c), and then such waiver or consent shall be effective only in the specific instances and for the purposes for which given and to the extent specified in such writing. No notice to or demand on Borrower shall in any case of itself entitle Borrower to any other or further notice or demand in similar or other circumstances. This Agreement and the other Loan Papers set forth the entire understanding and agreement of the parties hereto and thereto with respect to the transactions contemplated herein and therein and supersede all prior discussions and understandings with respect to the subject matter hereof and thereof, and no modification or amendment of or supplement to this Agreement or the other Loan Papers shall be valid or effective unless the same is in compliance with Section 14.2(c).
(b)Borrower acknowledges and agrees, and acknowledges its Affiliates’ understanding, that (i) it has been advised by counsel in the negotiation, execution and delivery of the Loan Papers to which it is a party, (ii) it has made an independent decision to enter into this Agreement and the other Loan Papers to which it is a party, without reliance on any representation, warranty, covenant or undertaking by Banks or Agents whether written, oral or implicit, other than as expressly set out in this Agreement or in another Loan Paper delivered on or after the Effective Date, (iii) there are no representations, warranties, covenants, undertakings or agreements by any Bank or any Agent as to the Loan Papers except as expressly set out in this Agreement or in another Loan Paper delivered on or after the Effective Date, (iv) neither any Bank nor any Agent owes any fiduciary duty to Borrower or any other Credit Party with respect to any Loan Paper or the transactions contemplated thereby, (v) the relationship pursuant to the Loan Papers between Borrower, on one hand, and Banks and Agents, on the other hand, is and shall be solely that of debtor and creditor, respectively, (vi) no partnership or joint venture exists with respect to the Loan Papers between Borrower and any Bank or any Agent, (vii) should an Event of Default or Default occur or exist each Bank and each Agent will determine in its sole and absolute discretion and for its own reasons what remedies and actions it will or will not exercise or take at that time, (viii) without limiting any of the foregoing, Borrower is not relying upon any representation or covenant by any Bank or any Agent or any representative thereof, and no such representation or covenant has been made, that any Bank or any Agent will, at the time of an Event of Default, or at any other time, waive, negotiate, discuss, or take or refrain from taking any action permitted under the Loan Papers with respect to any such Event of Default or Default or any other provision of the Loan Papers, and (ix) each Bank has relied upon the truthfulness of the acknowledgments in this Section 14.2(b) in deciding to execute and deliver this Agreement and to make the Loans.
(c)The Aggregate Elected Commitment Amount, a Bank’s Elected Commitment Amount, a Bank’s Maximum Credit Amount, the Applicable Percentage of each Bank and Schedule 1 to this Agreement may be amended as set forth in Section 2.15 and Section 14.8(c). Administrative Agent and Borrower may, without the consent of any Bank, enter into amendments or modifications to this Agreement in order to effectuate the terms of Section 13.1(b) in accordance with, and to the extent set forth in, the terms of Section 13.1(b). Any other provision of this Agreement, the Notes or the other Loan Papers may be amended or waived if, but only if such amendment or waiver is in writing and is signed by Borrower and Majority Banks (and, if the rights or duties of Administrative Agent are affected thereby, by Administrative Agent); provided that, (i) no such amendment or waiver shall (A) increase the Commitment, Elected Commitment or Maximum Credit Amount of any Bank without the written consent of such Bank, (B) subject any Bank to any additional obligation to extend credit without the written consent of such Bank, or (C) decrease (other than pursuant to Section 4.6, Section 4.7 and Section 5.2) or maintain the Borrowing Base without the consent of the Required Banks and (ii) no such amendment or waiver shall unless signed by all Banks (or, in the case of the following clauses (C) and (D), each Bank affected thereby): (A) increase the Borrowing Base, (B) amend or waive any of the provisions of Section 4.2, Section 4.3, Section 4.4 or Section 4.5 or the definitions contained in Section 1.1 applicable thereto in any manner that results in any increase in the Borrowing Base, (C) forgive any of the principal of or reduce the rate of interest on the Loans (other than as a result of the adoption of a Replacement Rate pursuant to Section 13.1(b)) or any fees hereunder, (D) postpone the Termination Date or any date fixed for any payment of principal of or interest on the Loan or any fees hereunder (provided that the amounts to be paid may be determined or modified in accordance with the terms hereof), (E) change the percentages of the Aggregate Maximum Credit Amount, the definitions of “Majority Banks”, “Required Banks” and/or “Super Majority Banks”, or the number of Banks which shall be required for the Banks or any of them to take any action under this Section 14.2(c) or any other provision of this Agreement, (F) permit Borrower to assign any of its rights hereunder, (G) provide for the release or substitution of all or substantially all of the collateral for the Obligations other than releases required in connection with sales of collateral that are expressly permitted by Section 9.5 or releases permitted pursuant to Section 12.14, (H) provide for the release of any Credit Party from its Facility Guaranty, except in connection with a transaction expressly permitted under this Agreement or any other Loan Paper, or (I) amend any provisions governing the pro rata sharing of payments among Banks in a manner to permit non- pro rata sharing of payments among Banks. Notwithstanding the foregoing, (x) Borrower and Administrative Agent may amend this Agreement or any other Loan Paper without the consent of the Banks in order to correct, amend or cure any ambiguity, inconsistency or defect or correct any typographical error or other manifest error in any Loan Paper, and (y) Administrative Agent and Borrower (or other applicable Credit Party) may enter into any amendment, modification or waiver of this Agreement or any other Loan Paper or enter into any agreement or instrument to effect the granting, perfection, protection, expansion or enhancement of any security interest in any Mortgaged Property or Property to become Mortgaged Property to secure the Obligations for the benefit of the Secured Parties or as required by any applicable Law to give effect to, protect or otherwise enhance the rights or benefits of any Bank under the Loan Papers without the consent of any Bank. Borrower, Administrative Agent and each Bank further acknowledge that any decision by Administrative Agent or any Bank to enter into any amendment, waiver or consent pursuant hereto shall be made by such Bank or Administrative Agent in its sole discretion, and in making any such decision Administrative Agent and each such Bank shall be permitted to give
due consideration to any credit or other relationship Administrative Agent or any such Bank may have with Borrower, any other Credit Party or any Affiliate of any Credit Party.
Section 14.3 Expenses; Indemnification.
(a)Borrower shall pay (i) all reasonable and documented out-of-pocket expenses of Administrative Agent, including reasonable and documented fees and disbursements of special counsel for Administrative Agent, in connection with the preparation of this Agreement and the other Loan Papers and, if appropriate, the recordation of the Loan Papers, any waiver or consent hereunder or any amendment hereof or any Default or alleged Default hereunder, and (ii) if an Event of Default has occurred and is continuing, all documented out-of-pocket expenses incurred by Administrative Agent and each Bank, including fees and disbursements of counsel in connection with such Event of Default and collection and other enforcement proceedings resulting therefrom, fees of auditors and consultants incurred in connection therewith and investigation expenses incurred by Administrative Agent and each Bank in connection therewith.
(b)BORROWER AGREES TO INDEMNIFY EACH INDEMNIFIED ENTITY (AS DEFINED BELOW), UPON DEMAND, FROM AND AGAINST ANY AND ALL LIABILITIES, OBLIGATIONS, CLAIMS, LOSSES, DAMAGES, PENALTIES, FINES, ACTIONS, JUDGMENTS, SUITS, SETTLEMENTS, COSTS, EXPENSES OR DISBURSEMENTS (INCLUDING REASONABLE FEES OF ATTORNEYS, ACCOUNTANTS, EXPERTS AND ADVISORS) OF ANY KIND OR NATURE WHATSOEVER (IN THIS SECTION COLLECTIVELY CALLED “LIABILITIES AND COSTS”) WHICH TO ANY EXTENT (IN WHOLE OR IN PART) MAY BE IMPOSED ON, INCURRED BY, OR ASSERTED AGAINST SUCH INDEMNIFIED ENTITY ARISING OUT OF, IN CONNECTION WITH, OR AS A RESULT OF ANY OF THE COLLATERAL FOR THE LOANS, THE LOAN PAPERS, OR THE TRANSACTIONS AND EVENTS (INCLUDING THE ENFORCEMENT OR DEFENSE THEREOF) AT ANY TIME PROVIDED FOR OR CONTEMPLATED THEREIN (INCLUDING ANY VIOLATION OR NONCOMPLIANCE WITH ANY APPLICABLE ENVIRONMENTAL LAWS BY ANY CREDIT PARTY OR ANY LIABILITIES OR DUTIES OF ANY CREDIT PARTY OR OF ANY INDEMNIFIED ENTITY WITH RESPECT TO HAZARDOUS SUBSTANCES FOUND IN OR RELEASED INTO THE ENVIRONMENT). THIS SECTION 14.3(b) SHALL NOT APPLY WITH RESPECT TO TAXES OTHER THAN ANY TAXES THAT REPRESENT LOSSES, CLAIMS, DAMAGES, ETC. ARISING FROM ANY NON-TAX CLAIM.
THE FOREGOING INDEMNIFICATION SHALL APPLY WHETHER OR NOT SUCH LIABILITIES AND COSTS ARE IN ANY WAY OR TO ANY EXTENT OWED, IN WHOLE OR IN PART, UNDER ANY CLAIM OR THEORY OF STRICT LIABILITY OR ARE IN ANY EXTENT CAUSED, IN WHOLE OR IN PART, BY ANY NEGLIGENT ACT OR OMISSION OF ANY KIND BY ANY INDEMNIFIED ENTITY; PROVIDED THAT, NO INDEMNIFIED ENTITY SHALL BE ENTITLED UNDER THIS SECTION 14.3(b) TO RECEIVE INDEMNIFICATION FOR THAT PORTION, IF ANY, OF ANY LIABILITIES AND COSTS RESULTING FROM (A) SUCH INDEMNIFIED ENTITY’S OWN INDIVIDUAL GROSS NEGLIGENCE OR WILLFUL MISCONDUCT, (B) A CLAIM BROUGHT BY ANY CREDIT PARTY AGAINST AN INDEMNIFIED ENTITY FOR A BREACH IN BAD FAITH OF SUCH INDEMNIFIED ENTITY’S OBLIGATIONS CONTEMPLATED BY THIS AGREEMENT
AND THE OTHER LOAN PAPERS, OR (C) A DISPUTE SOLELY BETWEEN OR AMONG THE INDEMNIFIED ENTITIES THAT DOES NOT INVOLVE ANY ACTION OR OMISSION BY BORROWER, ANY OTHER CREDIT PARTY OR ANY OF THEIR SUBSIDIARIES OR AFFILIATES, OTHER THAN CLAIMS AGAINST ANY OF ADMINISTRATIVE AGENT OR BANK OR ANY OF THEIR AFFILIATES IN THEIR CAPACITIES OR FULFILLING THEIR ROLES AS “ADMINISTRATIVE AGENT”, “ARRANGER”, “LEAD ARRANGER”, OR ANY SIMILAR ROLE UNDER THIS AGREEMENT, IN EACH CASE, AS DETERMINED BY A COURT OF COMPETENT JURISDICTION IN A FINAL, NON-APPEALABLE JUDGMENT. AS USED HEREIN, THE TERM “INDEMNIFIED ENTITY” REFERS TO EACH BANK, ADMINISTRATIVE AGENT, LETTER OF CREDIT ISSUER, AND EACH DIRECTOR, OFFICER, AGENT, TRUSTEE, MANAGER, ATTORNEY, EMPLOYEE, REPRESENTATIVE, PARTNER, ADVISORS, AGENTS AND AFFILIATE OF ANY SUCH PERSON AND THEIR RESPECTIVE HEIRS, SUCCESSORS AND PERMITTED ASSIGNS.
(c)The agreements in this Section 14.3 shall survive the resignation of Administrative Agent, the Letter of Credit Issuer, the replacement of any Bank, the termination of the Total Commitment, the repayment, satisfaction or discharge of all the other Obligations, and the termination of the Loan Papers.
Section 14.4 Right and Sharing of Set-Offs.
(a)If any Event of Default shall have occurred and be continuing, each Bank is hereby authorized at any time and from time to time, to the fullest extent permitted by Law, to set off and apply any and all deposits (general or special, time or demand, provisional or final) at any time held and other indebtedness at any time owing by such Bank to or for the credit or the account of any Credit Party against any and all of the obligations now or hereafter existing under this Agreement and any Note held by such Bank, irrespective of whether or not such Bank shall have made any demand under this Agreement or such Note and although such obligations may be unmatured. Each Bank agrees promptly to notify such Credit Party after any such setoff and application made by such Bank, provided that the failure to give such notice shall not affect the validity of such setoff and application. The rights of each Bank under this Section 14.4(a) are in addition to other rights and remedies (including other rights of setoff) which such Bank may have.
(b)Each Bank agrees that if it shall, by exercising any right of setoff or counterclaim or otherwise, receive payment after the occurrence and during the continuance of an Event of Default of a proportion of the aggregate amount of principal and interest due with respect to the Loans which is greater than the proportion received by any other Bank in respect of the Loans, the Bank receiving such proportionately greater payment shall purchase such participations in the interests in the Loans held by the other Banks, and such other adjustments shall be made, as may be required so that all such payments of principal and interest with respect to the Loans held by Banks shall be shared by Banks ratably in accordance with their respective Applicable Percentages; provided that nothing in this Section 14.4(b) shall impair the right of any Bank to exercise any right of setoff or counterclaim it may have and to apply the amount subject to such exercise to the payment of indebtedness of any Credit Party other than its indebtedness under the Loans. Borrower agrees, to the fullest extent they may effectively do so under applicable Law, that Participants may exercise
rights of setoff or counterclaim and other rights with respect to such participation as fully as if such holder of a participation were a direct creditor of Borrower in the
amount of such participation; provided that such Participant agrees to be subject to this Section 14.4(b) as though it were a Bank.
Section 14.5 Survival. All of the various representations, warranties, covenants, indemnities and agreements in the Loan Papers shall survive the execution and delivery of this Agreement and the other Loan Papers and the performance hereof and thereof, including the making or granting of the Loans and the delivery of the Notes and the other Loan Papers, and shall further survive until all of the Obligations (other than contingent indemnification obligations) owing under the Loan Papers to Administrative Agent, the Banks and (unless the Letter of Credit Issuer has advised Administrative Agent that the Obligations owing to it are otherwise adequately provided for) the Letter of Credit Issuer are paid in full and all of Banks’ obligations to Borrower are terminated, and at such time Administrative Agent shall, upon request by Borrower, confirm that this Agreement and the other Loan Papers have terminated; provided that, (a) to the extent expressly provided in any indemnification clause contained herein or in any other Loan Paper, such indemnification obligation shall survive payment in full of the Obligations and termination of the obligations of Banks to Borrower hereunder and (b) release of the Liens under the Security Instruments shall be subject to Section 12.14. All statements and agreements by Borrower to any Bank or Administrative Agent in any Loan Paper shall be deemed representations and warranties by Borrower or agreements and covenants of Borrower under this Agreement. The representations, warranties and covenants made by any Credit Party (as applicable) in the Loan Papers, and the rights, powers and privileges granted to Banks and Administrative Agent in the Loan Papers, are cumulative, and, except for expressly specified waivers and consents, no Loan Paper shall be construed in the context of another to diminish, nullify, or otherwise reduce the benefit to Banks and Administrative Agent of any such representation, warranty, covenant, right, power or privilege. In particular and without limitation, no exception set out in this Agreement to any representation, warranty or covenant herein contained shall apply to any similar representation, warranty or covenant contained in any other Loan Paper, and each such similar representation, warranty or covenant shall be subject only to those exceptions which are expressly made applicable to it by the terms of the various Loan Papers.
Section 14.6 Limitation on Interest. Each Bank, each Agent, Borrower, each other Credit Party and any other parties to the Loan Papers intend to contract in strict compliance with applicable usury Law from time to time in effect. In furtherance thereof such Persons stipulate and agree that none of the terms and provisions contained in the Loan Papers shall ever be construed to create a contract to pay, for the use, forbearance or detention of money, interest in excess of the Maximum Lawful Rate. None of Borrower, any other Credit Party, nor any present or future guarantors, endorsers, or other Persons hereafter becoming liable for payment of any Obligation shall ever be liable for unearned interest thereon or shall ever be required to pay interest thereon in excess of the Maximum Lawful Rate and the provisions of this Section 14.6 shall control over all other provisions of the Loan Papers which may be in conflict or apparent conflict herewith. Each Bank and Administrative Agent expressly disavow any intention to charge or collect excessive unearned interest or finance charges in the event the maturity of any Obligation is accelerated. If (a) the maturity of any Obligation is accelerated for any reason, (b) any Obligation is prepaid and as a result any amounts held to constitute interest are determined to be in excess of the Maximum Lawful Rate, or (c) any Bank or any other holder of any or all of the Obligations shall otherwise collect moneys which are determined to constitute interest which would otherwise increase the interest on any or all of the Obligations to an amount in excess of the Maximum
Lawful Rate, then all such sums determined to constitute interest in excess of the Maximum Lawful Rate shall, without penalty, be promptly applied to reduce the then outstanding principal of the related Obligations or, at any Bank’s or such holder’s option, promptly returned to Borrower or the other payor thereof upon such determination. In determining whether or not the interest paid or payable, under any specific circumstance, exceeds the Maximum Lawful Rate, Administrative Agent, Banks, Borrower and the other Credit Parties (and any other payors or payees thereof) shall to the greatest extent permitted under applicable Law, (i) characterize any non-principal payment as an expense, fee or premium rather than as interest, (ii) exclude voluntary prepayments and the effects thereof, and (iii) amortize, prorate, allocate, and spread the total amount of interest throughout the entire contemplated term of the instrument evidencing the Obligations in accordance with the amounts outstanding from time to time thereunder and the Maximum Lawful Rate in order to lawfully charge the Maximum Lawful Rate. Notwithstanding anything to the contrary contained in this Agreement, if at any time the rate of interest calculated with reference to the Adjusted Base Rate or the LIBOR Rate hereunder (as used in this sub-section, the “contract rate”) is limited to the Maximum Lawful Rate, any subsequent reductions in the contract rate shall not reduce the rate of interest on the Loans below the Maximum Lawful Rate until the total amount of interest accrued equals the amount of interest which would have accrued if the contract rate had at all times been in effect. In the event that at maturity (stated or by acceleration), or at final payment of any Loan, the total amount of interest paid or accrued on such Loan is less than the amount of interest which would have accrued if the contract rate had at all times been in effect with respect thereto, then at such time, to the extent permitted by Law, Borrower shall pay to the holder of such Loan an amount equal to the difference between (i) the lesser of the amount of interest which would have accrued if the contract rate had at all times been in effect and the amount of interest which would have accrued if the Maximum Lawful Rate had at all times been in effect, and (ii) the amount of interest actually paid on such Loan.
Section 14.7 Invalid Provisions. If any provision of the Loan Papers is held to be illegal, invalid, or unenforceable under present or future Laws effective during the term thereof, such provision shall be fully severable, the Loan Papers shall be construed and enforced as if such illegal, invalid, or unenforceable provision had never comprised a part thereof, and the remaining provisions thereof shall remain in full force and effect and shall not be affected by the illegal, invalid, or unenforceable provision or by its severance therefrom. Furthermore, in lieu of such illegal, invalid, or unenforceable provision there shall be added automatically as a part of the Loan Papers a provision as similar in terms to such illegal, invalid, or unenforceable provision as may be possible and be legal, valid and enforceable.
Section 14.8 Successors and Assigns.
(a)Each Loan Paper binds and inures to the parties thereto and each of their respective successors and permitted assigns permitted thereby (including any Affiliate of Letter of Credit Issuer that issues any Letter of Credit and Participants to the extent provided in Section 14.8(b)), and any Indemnified Entity of each of Administrative Agent, the Letter of Credit Issuer and Banks. No Credit Party may assign or transfer any rights or obligations under any Loan Paper without first obtaining the consent of all Banks (other than any Defaulting Bank), and any purported assignment or transfer without all Banks’ consent is void. No Bank may transfer, pledge, assign,
sell any participation in, or otherwise encumber its portion of the Obligations except as permitted by clauses (b) or (c) below.
(b)Any Bank may (subject to the provisions of this section, in accordance with applicable Law, in the ordinary course of its business, and at any time) sell to one or more Persons (each a “Participant”) participating interests in its portion of the Obligations. The selling Bank remains a “Bank” under the Loan Papers, the Participant does not become a “Bank” under the Loan Papers, and the selling Bank’s obligations under the Loan Papers remain unchanged. The selling Bank remains solely responsible for the performance of its obligations and remains the holder of its share of the outstanding Loans for all purposes under the Loan Papers. Borrower and Administrative Agent shall continue to deal solely and directly with the selling Bank in connection with that Bank’s rights and obligations under the Loan Papers, and each Bank must retain the sole right and responsibility to enforce due obligations of Borrower and/or any other Credit Party. Participants have no rights under the Loan Papers except certain voting rights as provided below. Subject to the following, each Bank may obtain (on behalf of its Participants) the benefits of Article XIII with respect to all participations in its part of the Obligations outstanding from time to time (subject to the requirements and limitations therein, including the requirements under Section 13.5(g) (it being understood that the documentation required under Section 13.5(g) shall be delivered to the participating Bank)) to the same extent as if it were a Bank and had acquired its interest by assignment pursuant to Section 14.8(c); provided that such Participant shall not be entitled to receive any greater payment under Article XIII with respect to its participation, than its participating Bank would have been entitled to receive, except to the extent such entitlement to receive a greater payment results from a Change in Law that occurs after the Participant acquired the applicable participation. No Bank may sell any participating interest under which the Participant has any rights to approve any amendment, modification, or waiver of any Loan Paper except to the extent such amendment, modification or waiver would (i) extend the Termination Date, (ii) reduce the interest rate or fees applicable to the Commitments or any portion of the Loans in which such Participant is participating, or postpone the payment of any thereof, or (iii) release all or substantially all of the collateral or guarantees securing any portion of the Aggregate Maximum Credit Amount or the Loans in which such Participant is participating. In addition, each agreement creating any participation must include an agreement by the Participant to be bound by the provisions of Section 14.14.
(c)Each Bank that sells a participation shall, acting solely for this purpose as an agent of Borrower, maintain a register on which it enters the name and address of each Participant and the principal amounts (and stated interest) of each Participant’s interest in the Loans or other obligations under the Loan Papers (the “Participant Register”); provided that no Bank shall have any obligation to disclose all or any portion of the Participant Register (including the identity of any Participant or any information relating to a Participant's interest in any commitments, loans, letters of credit or its other obligations under any Loan Paper) to any Person except to the extent that such disclosure is necessary to establish that such commitment, loan, letter of credit or other obligation is in registered form under Section 5f.103-1(c) of the United States Treasury Regulations. The entries in the Participant Register shall be conclusive absent manifest error, and such Bank shall treat each Person whose name is recorded in the Participant Register as the owner of such participation for all purposes of this Agreement notwithstanding any notice to the contrary. For the avoidance of doubt, Administrative Agent (in its capacity as Administrative Agent) shall have no responsibility for maintaining a Participant Register.
(d)Each Bank may make assignments to the Federal Reserve Bank or any central bank having jurisdiction over such Bank. Each Bank may also assign to one or more
assignees (each an “Assignee”) all or any part of its rights and obligations under the Loan Papers so long as (i) Administrative Agent consents in writing thereto (such consent not to be unreasonably withheld or delayed), provided that no such consent shall be required for an assignment to a Bank or an Affiliate of a Bank, (ii) Borrower consents in writing thereto (such consent not to be unreasonably withheld or delayed), provided that no such consent shall be required for an assignment to a Bank, an Affiliate of a Bank, or, if an Event of Default exists, any other assignee, (iii) the assignor Bank and Assignee execute and deliver to Administrative Agent an assignment and assumption agreement in substantially the form of Exhibit E (an “Assignment and Assumption Agreement”) and pay to Administrative Agent a processing fee of $3,500, (iv) the Assignee acquires an identical percentage interest in the Maximum Credit Amount and Elected Commitment of the assignor Bank and an identical percentage of the interests in the outstanding Loans held by such assignor Bank, and (v) the conditions (including minimum amounts of the Aggregate Maximum Credit Amount that may be assigned or that must be retained) for that assignment set forth in the applicable Assignment and Assumption Agreement are satisfied. The “Effective Date” in each Assignment and Assumption Agreement must (unless a shorter period is agreeable to Borrower (solely to the extent Borrower is required to consent to such assignment pursuant to clause (ii) herein) and Administrative Agent) be at least three Business Days after it is executed and delivered by the assignor Bank and Assignee to Administrative Agent and Borrower (solely to the extent Borrower is required to consent to such assignment pursuant to clause (ii) herein) for acceptance. Once that Assignment and Assumption Agreement is accepted by Administrative Agent and Borrower (solely to the extent Borrower is required to consent to such assignment pursuant to clause (ii) herein), then, from and after the Effective Date stated in it (A) the Assignee automatically becomes a party to this Agreement and, to the extent provided in that Assignment and Assumption Agreement, has the rights and obligations of a Bank under the Loan Papers, (B) the assignor Bank, to the extent provided in that Assignment and Assumption Agreement, is released from its obligations to fund Borrowings under this Agreement and its reimbursement obligations under this Agreement and, in the case of an Assignment and Assumption Agreement covering all of the remaining portion of the assignor Bank’s rights and obligations under the Loan Papers, that Bank ceases to be a party to the Loan Papers, (C) Borrower shall execute and deliver to the assignor Bank and Assignee the appropriate Notes (if requested) in accordance with this Agreement following the transfer, (D) upon delivery of the Notes under clause (C) preceding, the assignor Bank shall return to Borrower all Notes previously delivered to that Bank under this Agreement, and (E) Schedule 1 hereto is automatically deemed to be amended to reflect the name, Maximum Credit Amount and Elected Commitment of Assignee and the remaining Maximum Credit Amount or Elected Commitment (if any) of the assignor Bank, and Administrative Agent shall prepare and circulate to Borrower and Banks an amended Schedule 1, reflecting those changes.
(e)Administrative Agent, acting for this purpose as an agent of Borrower, shall maintain at one of its offices a copy of each Assignment and Assumption Agreement delivered to it and a register for the recordation of the names and addresses of Banks, and the Maximum Credit Amount and Elected Commitment of, and principal amount (and stated interest) of the Loans and payments made in respect of Letter of Credit disbursements owing to, each Bank pursuant to the terms hereof from time to time (the “Register”). The entries in the Register shall be conclusive absent manifest error, and Borrower, Administrative Agent, the Letter of Credit Issuer and Banks shall treat each Person whose name is recorded in the Register pursuant to the terms hereof as a
Bank hereunder for all purposes of this Agreement, notwithstanding notice to the contrary. The Register shall be available for inspection by Borrower, the Letter of Credit Issuer and any Bank, at any reasonable time and from time to time upon reasonable prior notice.
Section 14.9 Applicable Law and Jurisdiction. THIS AGREEMENT (INCLUDING THE VALIDITY AND ENFORCEABILITY HEREOF) SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK. Any
legal action or proceeding with respect to this Agreement or any Loan Paper may be brought in the courts of the State of New York, the U.S. Federal Courts in such state, sitting in the County of New York, and each of Borrower, Administrative Agent, Letter of Credit Issuer and the Banks hereby irrevocably (a) accepts the non-exclusive jurisdiction of such courts for the purpose of any such action or proceeding, (b) to the extent permitted by applicable Law, consents to the service of process out of said courts by the mailing thereof by U.S. registered or certified mail postage prepaid to such Person at its address as designated or provided in Section 14.1 and agrees that a final judgment in any action or proceeding shall be conclusive and may be enforced in any other jurisdiction by suit on the judgment or in any other manner provided by Law. Nothing in this Section 14.9 shall affect the rights of any party hereto to serve legal process on any other party hereto in any other manner permitted by Law or affect the right of any party hereto to bring any action or proceeding against any other party hereto in the courts of any other jurisdiction. To the extent that any party hereto 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, execution or otherwise) with respect to either itself or its Property, such party hereby irrevocably waives such immunity in respect of its obligations under this Agreement and the other Loan Papers. Each party hereto hereby irrevocably waives any objection which it may now or hereafter have to the laying of venue of any suit, action or proceeding arising out of or relating to this Agreement or any Loan Paper brought in the Supreme Court of the State of New York, County of New York or the U.S. District Court for the Southern District of New York, and hereby further irrevocably waives any claims that any such suit, action or proceeding brought in any such court has been brought in an inconvenient forum.
Section 14.10 Counterparts; Effectiveness. This Agreement may be signed in any number of counterparts, each of which shall be an original, with the same effect as if the signatures thereto and hereto were upon the same instrument. Except as provided in Section 6.1, this Agreement shall become effective when it shall have been executed by Administrative Agent and when Administrative Agent shall have received counterparts hereof which, when taken together, bear the signatures of each of the other parties hereto, and thereafter shall be binding upon and inure to the benefit of the parties hereto and their respective successors and permitted assigns. Delivery of an executed counterpart of a signature page of this Agreement by facsimile or other electronic transmission (e.g. .pdf) shall be effective as delivery of a manually executed counterpart of this Agreement.
Section 14.11 No Third Party Beneficiaries. It is expressly intended that there shall be no third party beneficiaries of the covenants, agreements, representations or warranties herein contained other than Participants and Assignees permitted pursuant to Section 14.8 and Indemnified Entities to the extent provided in Section 14.3.
Section 14.12 COMPLETE AGREEMENT. THIS AGREEMENT AND THE OTHER LOAN PAPERS COLLECTIVELY REPRESENT THE FINAL AGREEMENT BY AND AMONG BANKS, ADMINISTRATIVE AGENT AND BORROWER AND MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS, OR SUBSEQUENT ORAL AGREEMENTS OF BANKS, ADMINISTRATIVE AGENT AND BORROWER. THERE ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN OR AMONG BANKS, ADMINISTRATIVE AGENT AND BORROWER.
Section 14.13 WAIVER OF JURY TRIAL, PUNITIVE DAMAGES, ETC. BORROWER, ADMINISTRATIVE AGENT, LETTER OF CREDIT ISSUER AND EACH BANK HEREBY (a) KNOWINGLY, VOLUNTARILY, INTENTIONALLY, AND IRREVOCABLY WAIVE, TO THE MAXIMUM EXTENT NOT PROHIBITED BY LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY LITIGATION BASED HEREON, OR DIRECTLY OR INDIRECTLY AT ANY TIME ARISING OUT OF, UNDER OR IN CONNECTION WITH THE LOAN PAPERS OR ANY TRANSACTION CONTEMPLATED THEREBY OR ASSOCIATED THEREWITH, BEFORE OR AFTER MATURITY; (b) IRREVOCABLY WAIVE, TO THE MAXIMUM EXTENT NOT PROHIBITED BY LAW, ANY RIGHT IT MAY HAVE TO CLAIM OR RECOVER IN ANY SUCH LITIGATION ANY “SPECIAL DAMAGES” (AS DEFINED BELOW); PROVIDED THAT NOTHING CONTAINED IN THIS SECTION 14.13(b) SHALL LIMIT BORROWER’S INDEMNIFICATION OBLIGATIONS TO THE EXTENT SET FORTH IN SECTION 14.3(b) TO THE EXTENT SUCH SPECIAL DAMAGES ARE INCLUDED IN ANY THIRD PARTY CLAIM IN CONNECTION WITH WHICH SUCH INDEMNIFIED ENTITY IS OTHERWISE ENTITLED TO INDEMNIFICATION HEREUNDER; (c) CERTIFY THAT NO PARTY HERETO NOR ANY REPRESENTATIVE OR AGENT OR COUNSEL FOR ANY PARTY HERETO HAS REPRESENTED, EXPRESSLY OR OTHERWISE, OR IMPLIED THAT SUCH PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVERS, AND (d) ACKNOWLEDGE THAT IT HAS BEEN INDUCED TO ENTER INTO THIS AGREEMENT, THE OTHER LOAN PAPERS AND THE TRANSACTIONS CONTEMPLATED HEREBY AND THEREBY BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS CONTAINED IN THIS SECTION. AS USED IN THIS SECTION, “SPECIAL DAMAGES” INCLUDES ALL SPECIAL, CONSEQUENTIAL, EXEMPLARY, OR PUNITIVE DAMAGES (REGARDLESS OF HOW NAMED), BUT DOES NOT INCLUDE ANY PAYMENT OR FUNDS WHICH ANY PARTY HERETO HAS EXPRESSLY PROMISED TO PAY OR DELIVER TO ANY OTHER PARTY HERETO.
Section 14.14 Confidential Information. Administrative Agent and each Bank agree that all documentation and other information made available by any Credit Party to any Agent or any Bank under the terms of this Agreement shall (except to the extent such documentation or other information is publicly available or hereafter becomes publicly available other than by action of Administrative Agent or such Bank, or was therefore known or hereinafter becomes known to Administrative Agent or such Bank independent of any disclosure thereto by any Credit Party) be held in the strictest confidence by Administrative Agent or such Bank and used solely in the administration and enforcement of the Loans from time to time outstanding from such Bank to Borrower and in the prosecution or defense of legal proceedings arising in connection herewith; provided that (a) Administrative Agent or such Bank may disclose documentation and information
to Administrative Agent and/or any Bank which is a party to this Agreement or any Affiliates thereof, and (b) Administrative Agent or such Bank may disclose such documentation or other information to any other bank or other Person to which such Bank sells or proposes to make an assignment or sell a participation in the Loans hereunder or any of its rights or obligations under this Agreement if such other bank or Person, prior to such disclosure, agrees in writing to be bound by the terms of the confidentiality statement customarily employed by Administrative Agent in connection with such potential transfers or such other confidentiality agreement not less restrictive than this Section 14.14. Notwithstanding the foregoing, nothing contained herein shall be construed to prevent Administrative Agent or a Bank from (i) making disclosure of any information (A) if required to do so by applicable Law or accepted banking regulatory practices,
(B)to any Governmental Authority having or claiming to have authority to regulate or oversee any aspect of such Bank’s business or that of such Bank’s corporate parent or Affiliates in connection with the exercise of such authority or claimed authority, (C) pursuant to any subpoena or if otherwise compelled in connection with any litigation or administrative proceeding, (D) to correct any false or misleading information which may become public concerning such Person’s relationship to any Credit Party, or (E) to the extent Administrative Agent or such Bank or its counsel deems necessary or appropriate to effect or preserve its security for the Obligations or any portion thereof or, while any Event of Default exists, to enforce any remedy provided in this Agreement, or any other Loan Paper, or otherwise available by law; or (ii) making, on a confidential basis, such disclosures (1) as such Bank reasonably deems necessary or appropriate to its legal counsel, agents, advisors or accountants (including outside auditors) and (2) to the CUSIP Service Bureau or any similar agency in connection with the issuance and monitoring of CUSIP numbers with respect to the credit facility provided hereunder. If Administrative Agent or such Bank is compelled to disclose such confidential information in a proceeding requesting such disclosure, Administrative Agent or such Bank shall seek to obtain assurance that such confidential treatment will be accorded such information; provided that, neither Administrative Agent nor any Bank shall have any liability for the failure to obtain such treatment.
Section 14.15 No Advisory or Fiduciary Responsibility. In connection with all aspects of each transaction contemplated hereby (including in connection with any amendment, waiver or other modification hereof or of any other Loan Paper), Borrower acknowledges and agrees, and acknowledge its Affiliates’ understanding, that: (a)(i) the arranging and other services regarding this Agreement provided by Administrative Agent and the Arranger, are arm’s-length commercial transactions between Borrower and its Affiliates, on the one hand, and Administrative Agent and the Arranger, on the other hand, (ii) Borrower has consulted its own legal, accounting, regulatory and tax advisors to the extent it has deemed appropriate, and (iii) Borrower is capable of evaluating, and understands and accepts, the terms, risks and conditions of the transactions contemplated hereby and by the other Loan Papers; (b)(i) each of Administrative Agent, the Arranger and each Bank is and has been acting solely as a principal and, except as expressly agreed in writing by the relevant parties, has not been, is not, and will not be acting as an advisor, agent or fiduciary for Borrower or any of its Affiliates, or any other Person and (ii) none of Administrative Agent, the Arranger or any Bank has any obligation to Borrower or any of its Affiliates with respect to the transactions contemplated hereby except those obligations expressly set forth herein and in the other Loan Papers; and (c) Administrative Agent, the Arranger and Banks and their respective Affiliates may be engaged in a broad range of transactions that involve interests that differ from those of Borrower and its Affiliates, and neither Administrative Agent nor the Arranger or any
Bank has any obligation to disclose any of such interests to Borrower or its Affiliates. To the fullest extent permitted by law, Borrower hereby waives and releases any claims that it has against Administrative Agent, the Arranger and the Banks with respect to any breach or alleged breach of agency or fiduciary duty in connection with any aspect of any transaction contemplated hereby.
Section 14.16 USA Patriot Act Notice. Each Bank that is subject to the Act (as hereinafter defined) hereby notifies Borrower that pursuant to the requirements of the USA Patriot Act, it is required to obtain, verify and record information that identifies each Credit Party, which information includes the name and address of each Credit Party and other information that will allow such Bank or Administrative Agent, as applicable, to identify each Credit Party in accordance with the USA Patriot Act.
Section 14.17 Headings. Article and Section headings and the Table of Contents used herein are for convenience of reference only, are not part of this Agreement and shall not affect the construction of, or be taken into consideration in interpreting, this Agreement.
Section 14.18 Collateral Matters; Hedge Transactions. The benefit of the Security Instruments shall extend to and be available to the Secured Hedge Providers with respect to any Obligations described in clause (c) of the definition of “Obligations”. No Bank or any Affiliate of a Bank shall have any voting or consent rights under any Loan Paper as a result of the existence of obligations owed to it under any such Hedge Transactions.
Section 14.19 EXCULPATION PROVISIONS. EACH OF THE PARTIES HERETO SPECIFICALLY AGREES THAT IT HAS A DUTY TO READ THIS AGREEMENT AND THE OTHER LOAN PAPERS AND AGREES THAT IT IS CHARGED WITH NOTICE AND KNOWLEDGE OF THE TERMS OF THIS AGREEMENT AND THE OTHER LOAN PAPERS; THAT IT HAS IN FACT READ THIS AGREEMENT AND IS FULLY INFORMED AND HAS FULL NOTICE AND KNOWLEDGE OF THE TERMS, CONDITIONS AND EFFECTS OF THIS AGREEMENT; THAT IT HAS BEEN REPRESENTED BY INDEPENDENT LEGAL COUNSEL OF ITS CHOICE THROUGHOUT THE NEGOTIATIONS PRECEDING ITS EXECUTION OF THIS AGREEMENT AND THE OTHER LOAN PAPERS; AND HAS RECEIVED THE ADVICE OF ITS ATTORNEY IN ENTERING INTO THIS AGREEMENT AND THE OTHER LOAN PAPERS; AND THAT IT RECOGNIZES THAT CERTAIN OF THE TERMS OF THIS AGREEMENT AND THE OTHER LOAN PAPERS RESULT IN ONE PARTY ASSUMING THE LIABILITY INHERENT IN SOME ASPECTS OF THE TRANSACTION AND RELIEVING THE OTHER PARTY OF ITS RESPONSIBILITY FOR SUCH LIABILITY. EACH PARTY HERETO AGREES AND COVENANTS THAT IT WILL NOT CONTEST THE VALIDITY OR ENFORCEABILITY OF ANY EXCULPATORY PROVISION OF THIS AGREEMENT AND THE OTHER LOAN PAPERS ON THE BASIS THAT THE PARTY HAD NO NOTICE OR KNOWLEDGE OF SUCH PROVISION OR THAT THE PROVISION IS NOT “CONSPICUOUS.”
Section 14.20 Acknowledgement and Consent to Bail-In of EEA Financial Institutions. Notwithstanding anything to the contrary in any Loan Paper or in any other agreement, arrangement or understanding among any such parties, each party hereto acknowledges that any liability of any EEA Financial Institution arising under any Loan Paper may be subject to the
Write-Down and Conversion Powers of an EEA Resolution Authority and agrees and consents to, and acknowledges and agrees to be bound by:
(a) the application of any Write-Down and Conversion Powers by an EEA Resolution Authority to any such liabilities arising hereunder which may be payable to it by any party hereto that is an EEA Financial Institution; and
(b) | the effects of any Bail-In Action on any such liability, including, if |
instruments of ownership in such EEA Financial Institution, its parent entity, or a bridge institution that may be issued to it or otherwise conferred on it, and that such shares or other instruments of ownership will be accepted by it in lieu of any rights with respect to any such liability under this Agreement or any other Loan Paper; or
(iii)the variation of the terms of such liability in connection with the exercise of the Write-Down and Conversion Powers of any EEA Resolution Authority.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
fN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed by their respective Authorized Officers effective as of the day and year first above written.
BORROWER:
XXXXXXX RESOURCES, LLC,
a Delaware limited liability company
By: 
Name: Xxxxx Xxxxxxxx
Name: Xxxxx XxxxxxxxTitle: Chief Financial Officer
Address for Notice:
0000 X. Xxx0xx ard Dr. Xxxxxxxxxxx Xxxxx XX, Xxxxx 000 Xxxxxx, XX 00000
Attention: Xxxxx Xxxxxxxx, Chief Financial Officer Telephone: (000) 000-0000
Telecopy: (000) 000-0000
Email: bwilliams@brighammine xxxx.xxx
ADMINISTRATIVE AGENT, BANK AND LETTER OF CREDIT ISSUER:
XXXXX FARGO BANK, N.A.,
as Adminiirative e; aBank and Letter of Credit Issuer
-\sJ_ \
\-\ ?,I /-----
By: ' - l Name: Xxx Xxxxx Title: Director
BANKS:
CREDIT SUISSE AG, CAYMAN ISLANDS BRANCH,as a Bank
By: -_ ::.---,::..--:7 -c:::::::::=
Name: 
Title: Authorized Signatory
Title: Authorized SignatoryBARCLAYS BANK PLC,
as a Bank[SIGNATURE PAGETO CREDIT A GREEMENT - XXXXXXX RESOURCES, L L C]
COMPASS BANK,
as a BankBy: _
________________________
Name: Xxxxxxxx Xxxxxxxx
XXXXXXX XXXXX BANK USA,
as a BankBy: Name: Xxxx Xxxxxx
Title: Authorized Signatory
ROYAL BANK OF CANADA,
as a Bank
By: e ( q;((
Name: Xxxxxx Xxxxx
Title: Authorized Signatory
[SIGNATURE PAGE TO CREDIT AGREEMENT - XXXXXXX RESOURCES, LLC]
UBS AG, STAMFORD BRANCH,
as a Bank
Name: .:•.. , .,ng Produ ts Servioes, USTitle:
By: ,,,,.---
Name: Title: Xxxxxxx Xxxxx
Director
[SIGNATURE PAGE TO CREDIT AGREEMENT-XXXXXXX RESOURCES, LLC]
EXHIBIT A
FORM OF NOTE
$[ | ] [ ], 20[ ] |
FOR VALUE RECEIVED, XXXXXXX RESOURCES, LLC, a Delaware limited liability company (“Borrower”), hereby promises to pay to [ ] or registered assigns (the “Bank”), the principal amount of [ ] or, if less, the aggregate outstanding principal amount of the Loans (as defined in the Credit Agreement, referred to below) from time to time made by the Bank to Borrower under that certain Credit Agreement dated as of May 16, 2019 (as amended, restated, extended, supplemented or otherwise modified in writing from time to time, the “Credit Agreement”; the terms defined therein being used herein as therein defined), among Borrower, the banks from time to time party thereto (including the Bank), and Xxxxx Fargo Bank, N.A., as administrative agent (together with its successors or assigns, the “Administrative Agent”).
Borrower promises to pay interest on the unpaid principal amount of each Loan made by the Bank from the date of such Loan until such principal amount is paid in full, at such interest rates and at such times as provided in the Credit Agreement. All payments of principal and interest shall be made to Administrative Agent for the account of the Bank in Dollars in immediately available funds at Administrative Agent’s address as set forth on Schedule 1 to the Credit Agreement. If any amount is not paid in full when due hereunder, such unpaid amount shall bear interest, to be paid upon demand, from the due date thereof until the date of actual payment (and before as well as after judgment) computed at the per annum rate set forth in the Credit Agreement.
This note (this “Note”) is one of the Notes referred to in the Credit Agreement, is entitled to the benefits thereof and may be prepaid in whole or in part subject to the terms and conditions provided therein. This Note is also entitled to the benefits of each Facility Guaranty and is secured by the Liens granted pursuant to the Loan Papers. Upon the occurrence and continuation of one or more of the Events of Default specified in the Credit Agreement, all amounts then remaining unpaid on this Note shall become, or may be declared to be, immediately due and payable as provided in the Credit Agreement. Loans made by the Bank shall be evidenced by one or more loan accounts or records maintained by the Bank in the ordinary course of business, and will be recorded in the Register pursuant to Section 14.8(d) of the Credit Agreement. The Bank may also attach schedules to this Note and endorse thereon the date, amount and maturity of its Loans and payments with respect thereto. Failure to make any such notation or to attach a schedule shall not affect any Bank’s (as such term is defined in the Credit Agreement) or Borrower’s rights or obligations in respect of such Loans or affect the validity of such transfer by any Bank (as such term is defined in the Credit Agreement) of this Note.
Borrower, for itself and its successors and assigns, hereby waives diligence, presentment, protest and demand and notice of protest, demand, dishonor and non-payment of this Note.
[SIGNATURE PAGE FOLLOWS]
THIS NOTE SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.
XXXXXXX RESOURCES, LLC,
a Delaware limited liability company
By: Name: Title:
LOANS AND PAYMENTS WITH RESPECT THERETO
Date | Type of Loan Made | Amount of Loan Made | End of Interest Period | Amount of Principal or Interest Paid This Date | Outstanding Principal Balance This Date | Notation Made By | |||
EXHIBIT B
Reference is made to that certain Credit Agreement dated as of May 16, 2019 (as amended, restated, extended, supplemented or otherwise modified in writing from time to time, the “Credit Agreement”; the terms defined therein being used herein as therein defined), among Xxxxxxx Resources, LLC, a Delaware limited liability company (“Borrower”), the Banks from time to time party thereto, and Xxxxx Fargo Bank, N.A., as Administrative Agent.
The undersigned hereby requests a Borrowing of Loans:
1. | To be made on 1 |
2. | In the amount of $ |
3. | As [a Eurodollar][an Adjusted Base Rate] Borrowing |
4. | For Eurodollar Borrowings only: with an Interest Period of months.2 |
5.Prior to giving effect to such Borrowing, the Outstanding Revolving Credit exposure is $ .
6.The pro forma Outstanding Revolving Credit exposure, after giving effect to such Borrowing, is $ .
7. | Amount of Borrowing Base in effect on the date hereof is $[ ]. |
8. | Aggregate Elected Commitment Amount in effect on the date hereof is |
$[ ].
9. | The lesser of items 7 and 8 above is $[ ]. |
[Remainder of page intentionally left blank.]
1 A Business Day or, in the case of a Eurodollar Borrowing, a Eurodollar Business Day.
2 One (1), two (2), three (3), six (6), or twelve (12) months.
The undersigned hereby certifies that he/she is the [ ] of Borrower, and that as such he/she is authorized to execute this certificate on behalf of Borrower. The undersigned further certifies, represents and warrants on behalf of Borrower that Borrower is entitled to receive the requested Borrowing under the terms and conditions of the Credit Agreement.
XXXXXXX RESOURCES, LLC,
a Delaware limited liability company
By: Name: Title:
EXHIBIT C
FORM OF REQUEST FOR LETTER OF CREDIT
Date: 3
To: Xxxxx Fargo Bank, N.A., as Administrative Agent Ladies and Gentlemen:
Reference is made to that certain Credit Agreement dated as of May 16, 2019 (as amended, restated, extended, supplemented or otherwise modified in writing from time to time, the “Credit Agreement”; the terms defined therein being used herein as therein defined), among Xxxxxxx Resources, LLC, a Delaware limited liability company (“Borrower”), the Banks from time to time party thereto, and Xxxxx Fargo Bank, N.A., as Administrative Agent. Capitalized terms used herein and not otherwise defined shall have the meanings set forth in the Credit Agreement.
The undersigned hereby requests the issuance, amendment, renewal or extension (as applicable) of a Letter of Credit:
1. | The proposed date of issuance, amendment, renewal or extension of such Letter of Credit is: [ ].4 |
2. | For the issuance of a new Letter of Credit: |
(a) | The face amount of such Letter of Credit is $ [ ]. |
(b) | The expiration date of such Letter of Credit is [ ]. |
(c) | The name and address of the beneficiary of such Letter of Credit is: [ ] |
3. | For the amendment, renewal or extension of a Letter of Credit: A description of the Letter of Credit, amendment, renewal or extension (as applicable) being requested is as follows: |
3 To be delivered by 10:00 a.m. (Central time) at least three (3) Business Days before the proposed date of issuance, amendment, renewal or extension.
4 Must be a Business Day.
4. | Any other information as shall be necessary to prepare, amend, renew or extend the applicable Letter of Credit is as set forth below: |
5. | The full text of any certificate to be presented by the beneficiary in case of any drawing thereunder is [as follows: / set out on Annex A hereto]. |
6. | Prior to giving effect to such Letter of Credit, the Outstanding Revolving Credit exposure is $[ ]. |
7. | The pro forma Outstanding Revolving Credit exposure, after giving effect to such Letter of Credit, is $[ ]. |
8. | Amount of Borrowing Base in effect on the date hereof is $[ ]. |
9. | Aggregate Elected Commitment Amount in effect on the date hereof is |
$[ ].
10. | The lesser of items 8 and 9 above is $[ ]. |
[Remainder of page intentionally left blank.]
The undersigned hereby certifies that he/she is the [ ] of Borrower, and that as such he/she is authorized to execute this certificate on behalf of Borrower. The undersigned further certifies, represents and warrants on behalf of Borrower that Borrower is entitled to receive the requested Borrowing under the terms and conditions of the Credit Agreement.
XXXXXXX RESOURCES, LLC, a Delaware
limited liability company
By: Name: Title:
EXHIBIT D
Reference is made to that certain Credit Agreement dated as of May 16, 2019 (as amended, restated, extended, supplemented or otherwise modified in writing from time to time, the “Credit Agreement”; the terms defined therein being used herein as therein defined), among Xxxxxxx Resources, LLC, a Delaware limited liability company (“Borrower”), the Banks from time to time party thereto, and Xxxxx Fargo Bank, N.A., as Administrative Agent.
The undersigned hereby requests a continuation or conversion of Loans:
1. | On 5 |
2. | In the amount of $ |
3. | As [a Eurodollar][an Adjusted Base Rate] Borrowing |
4. | For Eurodollar Rate Loans: with an Interest Period of months.6 |
Borrower hereby represents and warrants that the conditions specified in Section 2.5(c) of the Credit Agreement shall be satisfied on and as of the date of the Rollover Notice.
[SIGNATURE PAGE FOLLOWS]
5 A Business Day or, in the case of a Eurodollar Borrowing, a Eurodollar Business Day.
6 One (1), two (2), three (3), six (6), or twelve (12) months.
XXXXXXX RESOURCES, LLC, a Delaware
limited liability company
By: Name: Title:
EXHIBIT E
FORM OF ASSIGNMENT AND ASSUMPTION AGREEMENT
This Assignment and Assumption Agreement (this “Assignment and Assumption Agreement”) is dated as of the Effective Date set forth below and is entered into by and between [the][each] Assignor identified in item 1 below ([the][each, an] “Assignor”) and [the][each]7 Assignee identified in item 2 below ([the][each, an] “Assignee”). [It is understood and agreed that the rights and obligations of [the Assignors][the Assignees] hereunder are several and not joint.]8 Capitalized terms used but not defined herein shall have the meanings given to them in the Credit Agreement identified below, receipt of a copy of which is hereby acknowledged by the Assignee. The Standard Terms and Conditions set forth in Annex 1 attached hereto are hereby agreed to and incorporated herein by reference and made a part of this Assignment and Assumption Agreement as if set forth herein in full.
For an agreed consideration, [the][each] Assignor hereby irrevocably sells and assigns to [the Assignee][the respective Assignees], and [the][each] Assignee hereby irrevocably purchases and assumes from [the Assignor][the respective Assignors], subject to and in accordance with the Standard Terms and Conditions and the Credit Agreement, as of the Effective Date inserted by Administrative Agent as contemplated below (i) all of [the Assignor’s][the respective Assignors’] rights and obligations in [its capacity as a Bank][their respective capacities as Banks] under the Credit Agreement and any other documents or instruments delivered pursuant thereto to the extent related to the amount and percentage interest identified below of all of such outstanding rights and obligations of [the Assignor][the respective Assignors] under the Loan Papers (including, without limitation, the Letters of Credit) and (ii) to the extent permitted to be assigned under applicable law, all claims, suits, causes of action and any other right of [the Assignor (in its capacity as a Bank)][the respective Assignors (in their respective capacities as Banks)] against any Person, whether known or unknown, arising under or in connection with the Credit Agreement, any other documents or instruments delivered pursuant thereto or the loan transactions governed thereby or in any way based on or related to any of the foregoing, including, but not limited to, contract claims, tort claims, malpractice claims, statutory claims and all other claims at law or in equity related to the rights and obligations sold and assigned pursuant to clause (i) above (the rights and obligations sold and assigned by [the][any] Assignor to [the][any] Assignee pursuant to clauses (i) and (ii) above being referred to herein collectively as [the][an] “Assigned Interest”). Each such sale and assignment is without recourse to [the][any] Assignor and, except as expressly provided in this Assignment and Assumption Agreement, without representation or warranty by [the][any] Assignor.
7 For bracketed language here and elsewhere in this form relating to the Assignee(s), if the assignment is to a single Assignee, choose the first bracketed language. If the assignment is to multiple Assignees, choose the second bracketed language.
8 Include bracketed language if there are either multiple Assignors or multiple Assignees.
1. | Assignor[s]: |
2. | Assignee[s]: |
3. | Borrower: Xxxxxxx Resources, LLC, a Delaware limited liability company |
4. | Administrative Agent: Xxxxx Fargo Bank, N.A. |
5.Credit Agreement: Credit Agreement dated as of May 16, 2019 (as amended, restated, extended, supplemented or otherwise modified in writing from time to time, the “Credit Agreement”), among Borrower, the Banks from time to time party thereto and Administrative Agent.
6. | Assigned Interest: |
Assignor[s] | Assignee[s] | Aggregate Maximum Credit Amounts of all Banks | Amount of Maximum Credit Amount Assigned | Percentage of Aggregate Maximum Credit Amount Assigned9 | Percentage of Assignor’s Maximum Credit Amount Assigned |
$ | $ | % | % | ||
7. | Effective Date: |
[SIGNATURE PAGE FOLLOWS]
9 Set forth, to at least 8 decimals, as a percentage of the Commitment/Loans of all Banks thereunder.
The terms set forth in this Assignment and Assumption Agreement are hereby agreed to: ASSIGNOR
[NAME OF ASSIGNOR]
By: Name: Title:
ASSIGNEE
[NAME OF ASSIGNEE]
By: Name: Title:
[Consented to and Accepted:10
XXXXX FARGO BANK, N.A.,
as Administrative Agent
By: Name: Title: ]
10 To be deleted only if the consent of Administrative Agent is not required by the terms of the Credit Agreement.
[Consented to:11
XXXXXXX RESOURCES, LLC,
a Delaware limited liability company
By: Name: Title:
11 To be deleted only if the consent of Borrower is not required by the terms of the Credit Agreement.
ANNEX 1 TO ASSIGNMENT AND ASSUMPTION AGREEMENT
STANDARD TERMS AND CONDITIONS FOR ASSIGNMENT AND ASSUMPTION AGREEMENT
1. | Representation and Warranties. |
1.1 Assignor. [The] [Each] Assignor (a) represents and warrants that (i) it is the legal and beneficial owner of [the] [[the relevant] Assigned Interest, (ii) [the] [such] Assigned Interest is free and clear of any lien, encumbrance or other adverse claim and (iii) it has full power and authority, and has taken all action necessary, to execute and deliver this Assignment and Assumption Agreement and to consummate the transactions contemplated hereby; and
(b) assumes no responsibility with respect to (i) any statements, warranties or representations made in or in connection with the Credit Agreement or any other Loan Paper, (ii) the execution, legality, validity, enforceability, genuineness, sufficiency or value of the Loan Papers or any collateral thereunder, (iii) the financial condition of Borrower, any of its Subsidiaries or Affiliates or any other Person obligated in respect of any Loan Paper or (iv) the performance or observance by Borrower, any of its Subsidiaries or Affiliates or any other Person of any of their respective obligations under any Loan Paper.
1.2. Assignee. [The] [Each] Assignee (a) represents and warrants that (i) it has full power and authority, and has taken all action necessary, to execute and deliver this Assignment and Assumption Agreement and to consummate the transactions contemplated hereby and to become a Bank under the Credit Agreement, (ii) it meets all the requirements to be an assignee under Sections 14.8(a) and 14.8(c) of the Credit Agreement (subject to such consents, if any, as may be required under Sections 14.8(a) and 14.8(c) of the Credit Agreement), (iii) from and after the Effective Date, it shall be bound by the provisions of the Credit Agreement as a Bank thereunder and, to the extent of [the] [the relevant] Assigned Interest, shall have the obligations of a Bank thereunder, (iv) it is sophisticated with respect to decisions to acquire assets of the type represented by [the] [such] Assigned Interest and either it, or the Person exercising discretion in making its decision to acquire [the][such] Assigned Interest, is experienced in acquiring assets of such type, (v) it has received a copy of the Credit Agreement, and has received or has been accorded the opportunity to receive copies of the most recent financial statements delivered pursuant to Sections 8.1(a) and 8.1(b) thereof, as applicable, and such other documents and information as it deems appropriate to make its own credit analysis and decision to enter into this Assignment and Assumption Agreement and to purchase [the] [such] Assigned Interest, (vi) it has, independently and without reliance upon Administrative Agent or any other Bank and based on such documents and information as it has deemed appropriate, made its own credit analysis and decision to enter into this Assignment and Assumption Agreement and to purchase [the] [such] Assigned Interest, and (vii) if it is a Foreign Bank, attached hereto is any documentation required to be delivered by it pursuant to Section 13.5(g) of the Credit Agreement, duly completed and executed by [the] [such] Assignee; and (b) agrees that (i) it will, independently and without reliance upon Administrative Agent, [the] [any] Assignor or any other Bank, and based on such documents and information as it shall deem appropriate at the time, continue to make its own credit decisions in taking or not taking action under the Loan Papers, and (ii) it will perform in accordance with
their terms all of the obligations which by the terms of the Loan Papers are required to be performed by it as a Bank.
2. Payments. From and after the Effective Date, Administrative Agent shall make all payments in respect of [the][each] Assigned Interest (including payments of principal, interest, fees and other amounts) to [the] [the relevant] Assignor for amounts which have accrued to but excluding the Effective Date and to [the] [the relevant] Assignee for amounts which have accrued from and after the Effective Date.
3. General Provisions. This Assignment and Assumption Agreement shall be binding upon, and inure to the benefit of, the parties hereto and their respective successors and assigns. This Assignment and Assumption Agreement may be executed in any number of counterparts, which together shall constitute one instrument. Delivery of an executed counterpart of a signature page of this Assignment and Assumption Agreement by telecopy shall be effective as delivery of a manually executed counterpart of this Assignment and Assumption Agreement. This Assignment and Assumption Agreement shall be governed by, and construed in accordance with, the law of the State of New York.
EXHIBIT F
FORM OF FINANCIAL COMPLIANCE CERTIFICATE
Financial Statement Date: To: Xxxxx Fargo Bank, N.A., as Administrative Agent
Ladies and Gentlemen:
Reference is made to that certain Credit Agreement dated as of May 16, 2019 (as amended, restated, extended, supplemented or otherwise modified in writing from time to time, the “Credit Agreement”; the terms defined therein being used herein as therein defined), among Xxxxxxx Resources, LLC, a Delaware limited liability company (“Borrower”), the Banks from time to time party thereto, and Xxxxx Fargo Bank, N.A., as Administrative Agent.
The undersigned12 hereby certifies on behalf and as the act of Borrower that he/she is the [ ] of Borrower, and, as such, he/she is authorized to execute and deliver this Financial Compliance Certificate (this “Certificate”) to Administrative Agent on behalf of Borrower, and that, as of the date hereof:
[Use following paragraph 1 for fiscal year-end financial statements pursuant to Section 8.1(a)(i) of the Credit Agreement]
1. Borrower has delivered, or has caused Parent to deliver:
(a)The year-end audited consolidated financial statements of Parent required by Section 8.1(a)(i)(A) of the Credit Agreement for the fiscal year of Parent ended as of the Financial Statement Date set forth above, audited by a firm of independent public accountants as required by such section. Such consolidated statements fairly present in all material respects the financial condition and results of operations of Parent and its Consolidated Subsidiaries, if any, on a consolidated basis in accordance with GAAP (as applicable) as of the date of such financial statements and for the period covered thereby.
(b)The year-end unaudited consolidated financial statements of Borrower required by Section 8.1(a)(i)(B) of the Credit Agreement for the fiscal year of Borrower ended as of the Financial Statement Date set forth above. Such consolidated statements fairly present in all material respects the financial condition and results of operations of Borrower and its Consolidated Subsidiaries, if any, on a consolidated basis in accordance with GAAP (as applicable) as of the date of such financial statements (subject to the absence of footnotes) and for the period covered thereby.
(c)The year-end unaudited consolidating financial statements of Parent required by Section 8.1(a)(i)(C) of the Credit Agreement for the fiscal year of Parent ended as of the Financial
12 This certificate should be from the chief financial officer, principal accounting officer, treasurer, controller or chief executive officer of Borrower.
Statement Date set forth above. Such consolidating statements fairly present in all material respects the financial condition and results of operations of Parent and its Consolidated Subsidiaries, if any, on a consolidating basis in accordance with GAAP (as applicable) as of the date of such financial statements (subject to the absence of footnotes) and for the period covered thereby.
[Use following paragraph 1 for fiscal year-end financial statements pursuant to Section 8.1(a)(ii) of the Credit Agreement]
1. Borrower has delivered the year-end audited consolidated financial statements of Borrower required by Section 8.1(a)(ii) of the Credit Agreement for the fiscal year of Borrower ended as of the Financial Statement Date set forth above, audited by a firm of independent public accountants as required by such section. Such consolidated statements fairly present in all material respects the financial condition and results of operations of Borrower and its Consolidated Subsidiaries, if any, on a consolidated basis in accordance with GAAP (as applicable) as of the date of such financial statements and for the period covered thereby.
[Use following paragraph 1 for fiscal quarter-end financial statements]
1.[(a)] Borrower has delivered the unaudited financial statements of Borrower required by Section 8.1(b) of the Credit Agreement for the fiscal quarter of Borrower ended as of the Financial Statement Date set forth above. Such consolidated financial statements fairly present in all material respects the financial condition and results of operations of Borrower and its Consolidated Subsidiaries, if any, on a consolidated basis in accordance with GAAP as of the date of such financial statements (subject to customary year-end adjustments and the absence of footnotes) and for the period covered thereby.
[(b) Borrower has caused Parent to deliver the unaudited consolidating financial statements of Parent required by Section 8.1(b) of the Credit Agreement for the fiscal quarter of Parent ended as of the Financial Statement Date set forth above. Such consolidating financial statements fairly present in all material respects the financial condition and results of operations of Parent and its Consolidated Subsidiaries on a consolidating basis (separating out Borrower by a specific column) in accordance with GAAP as of the date of such financial statements (subject to customary year-end adjustments and the absence of footnotes) and for the period covered thereby.]13
2.[Attached as Annex hereto / As shown in spreadsheets delivered in connection herewith] are calculations showing whether Borrower was in compliance with the requirements of Article X of the Credit Agreement on the Financial Statement Date set forth above.
3. | As of the date hereof, no Default exists.14 |
13 Paragraph (b) to be included so long as the Parent Audit Conditions are satisfied.
14 If a Default exists, change paragraph 3 to say that a Default exists and refer to an Annex setting forth the details thereof and the action which Borrower is taking or propose to take with respect thereto.
[4. As of the Financial Statement Date set forth above [check one]:
there is no Material Gas Imbalance15
there is an estimated Material Gas Imbalance and the aggregate net gas imbalances representing liabilities of the Credit Parties, taken as a whole, are |
$ ]16
[5. As of the Financial Statement Date set forth above [check one]:
there is no Advance Payment, individually or in the aggregate, in excess of the Threshold Amount that has been received under Advance Payment Contracts to which Borrower or any Restricted Subsidiary is a party or by which any working interests in Proved Mineral Interests owned by any Credit Party are bound which have not been satisfied by delivery of production
the aggregate amount of all Advance Payments in excess of the Threshold Amount received under Advance Payment Contracts to which Borrower or any Restricted Subsidiary is a party or by which any working interests in Proved Mineral Interests owned by any Credit Party are bound which have not been satisfied by delivery of production is $ ]17
[6.] Attached as Annex hereto is a true and complete list of all Hedge Transactions of Borrower and each Restricted Subsidiary in existence on the Financial Statement Date set forth above, showing the counterparties thereto, the material terms thereof (including the type, term, effective date, termination date and notional amounts or volumes), the estimated net xxxx-to- market value therefor, any credit support agreements relating thereto other than the Loan Papers, and any margin required or supplied under any such credit support document.
[7.] As of the Financial Statement Date set forth above [check one]:
Borrower has no Consolidated Unrestricted Subsidiaries
Borrower has one or more Consolidated Unrestricted Subsidiaries. [Attached as Annex hereto / As shown in spreadsheets delivered in connection herewith] are consolidating spreadsheets that show all Consolidated Unrestricted Subsidiaries and the eliminating entries, in such form as would be presentable to the auditors of Borrower.
15 See definition of “Material Gas Imbalance”.
16 To be included solely to the extent the Borrower or any Restricted Subsidiary owns any working interest in any Proved Mineral Interests.
17 To be included solely to the extent the Borrower or any Restricted Subsidiary owns any working interest in any Proved Mineral Interests.
IN WITNESS WHEREOF, the undersigned has executed this Certificate on behalf and as the act of Borrower (and not in any individual capacity) as of [ ].
XXXXXXX RESOURCES, LLC, a Delaware
limited liability company
By: Name: Title:
EXHIBIT G
FORM OF SECURITY AGREEMENT
[See attached.]
Exhibit G-1
Form of Security Agreement
PLEDGE AND SECURITY AGREEMENT
This PLEDGE AND SECURITY AGREEMENT (as it may be amended, restated, supplemented or otherwise modified from time to time, this “Security Agreement”) is entered into as of May 16, 2019, by and among each of the undersigned identified on the signature pages hereto as Grantors (together with any other entity that may become a party hereto as provided herein, each a “Grantor, and collectively, the “Grantors”), and XXXXX FARGO BANK, N.A., in its capacity as administrative agent (the “Administrative Agent”) for the Banks and the other Secured Parties.
PRELIMINARY STATEMENTS
A.On even date herewith, Xxxxxxx Resources, LLC, a Delaware limited liability company (the “Borrower”), the Administrative Agent, the banks and other financial institutions party thereto as “Banks” (the “Banks”), entered into that certain Credit Agreement (as amended, restated, replaced, supplemented or otherwise modified from time to time, the “Credit Agreement”) pursuant to which the Banks agreed to make loans and other extensions of credit to the Borrower for the purposes set forth therein.
B.The Borrower and/or certain of its Restricted Subsidiaries and certain Secured Hedge Providers have entered into or may from time to time enter into certain Hedge Agreements (collectively, the “Secured Hedge Agreements”).
C.The Borrower and/or certain of its Restricted Subsidiaries and certain Bank Products Providers have entered into or may from time to time enter into certain agreements regarding Bank Products (collectively, the “Secured Bank Products Agreements”).
D.From time to time, the Restricted Subsidiaries of the Borrower shall enter into the Facility Guaranty, whether by means of a joinder or assumption agreement related thereto or otherwise (such Facility Guaranty and such joinders and assumption agreements, as they may from time to time be amended, restated, replaced, supplemented or otherwise modified, are collectively the “Guaranty”) pursuant to which, upon the terms and conditions stated therein, the Guarantors from time to time party thereto shall guarantee the obligations of the Borrower and the other Credit Parties under the Credit Agreement, the other Loan Papers, the Secured Hedge Agreements, and the Secured Bank Products Agreements. The Credit Agreement, the Guaranty, the other Loan Papers, the Secured Hedge Agreements and the Secured Bank Products Agreements are collectively referred to herein as the “Secured Transaction Documents”).
E.The Administrative Agent and the other Secured Parties have conditioned their obligations under the Secured Transaction Documents upon the execution and delivery by the Grantors of this Security Agreement, and the Grantors have agreed to enter into this Security Agreement to secure all obligations owing to the Administrative Agent and the other Secured Parties under the Secured Transaction Documents.
F.Each Grantor has determined that valuable benefits will be derived by it as a result of the Credit Agreement and the extension of credit made (and to be made) by the Banks thereunder.
ACCORDINGLY, the Grantors and the Administrative Agent, on behalf of the Secured Parties, hereby act and agree as follows:
ARTICLE I DEFINITIONS
1.1. Terms Defined in Credit Agreement. All capitalized terms used herein and not otherwise defined shall have the meanings assigned to such terms in the Credit Agreement.
1.2. Terms Defined in UCC. Terms defined in the UCC which are not otherwise defined in this Security Agreement or the Credit Agreement are used herein as defined in the UCC.
1.3. Definitions of Certain Terms Used Herein. As used in this Security Agreement, in addition to the terms defined in the introductory paragraph hereto and in the Preliminary Statements, the following terms shall have the following meanings:
“Account Debtor” means a Person who is obligated on an Account.
“Account” shall have the meaning set forth in Article 9 of the UCC.
“Amendment” shall have the meaning set forth in Section 4.4 hereof.
“Article” means a numbered article of this Security Agreement, unless another document is specifically referenced.
“As-extracted Collateral” shall have the meaning set forth in Article 9 of the UCC.
“Assigned Contracts” means, collectively, all of the Grantors’ rights and remedies under, and all moneys and claims for money due or to become due to any Grantor under all written contracts, and any and all amendments, supplements, extensions, and renewals thereof including all rights and claims of the Grantors now or hereafter existing: (a) under any insurance, indemnities, warranties, and guarantees provided for or arising out of or in connection with any of the foregoing contracts; (b) for any damages arising out of or for breach or default under or in connection with any of the foregoing contracts; (c) to all other amounts from time to time paid or payable under or in connection with any of the foregoing contracts; or (d) to exercise or enforce any and all covenants, remedies, powers and privileges thereunder.
“Assumption Agreement” means an Assumption Agreement substantially in the form of Annex 1 hereto.
“Chattel Paper” and “Electronic Chattel Paper” shall have the meanings set forth in Article 9 of the UCC.
“Collateral” shall have the meaning set forth in Article II.
“Collateral Account” means any Deposit Account under the sole dominion and control of the Administrative Agent established by the Administrative Agent as provided in Section 7.1.
“Commercial Tort Claim” shall have the meaning set forth in Article 9 of the UCC.
“Commodity Account” shall have the meaning set forth in Article 9 of the UCC.
“Commodity Account Control Agreement” means an agreement, in form and substance reasonably satisfactory to the Administrative Agent, among any Credit Party, a commodity intermediary holding such Credit Party’s assets, including funds and commodity contracts, and the Administrative Agent with respect to collection and control of all deposits, commodity contracts and other balances held in a Commodity Account maintained by any Credit Party with such commodity intermediary.
“Control” shall have the meaning set forth in Article 8 or, if applicable, in Section 9-104, 9-105, 9-106 or 9-107 of Article 9 of the UCC.
“Control Agreement” means a Deposit Account Control Agreement, a Securities Account Control Agreement or a Commodity Account Control Agreement, as context may require.
“Copyrights” means, with respect to any Person, all of such Person’s right, title, and interest in and to the following: (a) all copyrights, rights and interests in copyrights, works protectable by copyright, copyright registrations, and copyright applications; (b) all renewals of any of the foregoing; and (c) all rights corresponding to any of the foregoing throughout the world.
“De Minimis Accounts” means (a) any Deposit Account, Commodity Account or Securities Account so long as the balance in each such account, individually, does not exceed
$250,000 at any time and the aggregate balance of all such Deposit Accounts, Commodity Accounts and Securities Accounts does not at any time exceed $1,000,000, (b) any Deposit Account that is a zero balance account or a Deposit Account for which the balance of such Deposit Account is transferred at the end of each date to a Deposit Account that is not a De Minimis Account, (c) any Deposit Account that is exclusively used to facilitate the payment of drafts presented by sellers or lessors of Mineral Interests, so long as the aggregate balance of any such Deposit Account does not at any time exceed the amounts of the drafts that have been presented and not subsequently withdrawn (or are reasonably expected to soon be presented) for drawing against such Deposit Account and (d) any other Deposit Accounts exclusively used for trust, payroll, payroll taxes and other employee wage and benefit payments to or for the benefit of any employees of the Grantors or any of their Subsidiaries.
“Deposit Account” shall have the meaning set forth in Article 9 of the UCC.
“Deposit Account Control Agreement” means an agreement, in form and substance reasonably satisfactory to the Administrative Agent, among any Credit Party, a banking institution holding such Credit Party’s funds, and the Administrative Agent with respect to collection and control of all deposits and balances held in a Deposit Account maintained by any Credit Party with such banking institution.
“Document” shall have the meaning set forth in Article 9 of the UCC.
“Effective Date” means (a) with respect to the Borrower and each other Grantor party hereto on the date hereof, the “Effective Date” as defined in the Credit Agreement, and (b) with respect to each other Grantor, the date of the Assumption Agreement by means of which such Grantor becomes a party hereto.
“Equipment” shall have the meaning set forth in Article 9 of the UCC.
“Excluded Assets” means:
(a)any motor vehicle in which a lien can only be perfected by action with respect to a certificate of title;
(b) | any As-extracted Collateral or Fixtures; |
(c) | any Patents, Copyrights, Trademarks or Licenses; |
(d)any contract, license, agreement, instrument or other document to the extent that the grant of a security interest therein is prohibited by, or constitutes a breach or default under or results in the termination of or gives rise to a right on the part of the parties thereto other than any Grantor to terminate (or materially modify) or requires any consent not obtained under, any such contract, license, agreement, instrument or other document, except to the extent that the term in such contract, license, agreement, instrument or other document providing for such prohibition, breach, default or right of termination or modification or requiring such consent is ineffective under Sections 9-406, 9-407, 9-408 or 9-409 of the UCC (or any successor provision or provisions) of any relevant jurisdiction or any other applicable law;
(e) | any Equity Interests in any Unrestricted Subsidiary; and |
(f)any other personal property that the Administrative Agent has (i) determined in its sole discretion to be immaterial for oil and gas mineral interest owners and the cost of obtaining such a security interest or perfection thereof are excessive in relation to the benefit of the Lenders of the security to be afforded thereby and (ii) designated as such in writing;
provided, however, that “Excluded Assets” shall (i) not include any right to receive proceeds from the sale or other disposition of Excluded Assets or any proceeds, substitutions or replacements of Excluded Assets (unless such proceeds, substitutions or replacements would constitute Excluded Assets) and (ii) with respect to the exclusions set forth in clause (d) above, not be construed to limit, impair or otherwise affect the Administrative Agent’s continuing security interests in any Grantor’s rights to or interests of any Grantor in (x) monies due or to become due under any such contract, license, agreement, instrument or other document (to the extent not prohibited by such contract, license, agreement, instrument or other document and applicable law), or (y) any proceeds from the sale, license, lease or other disposition of any such contract, license, agreement, instrument or other document. References in this Security Agreement to Collateral and to Goods, Equipment, Investment Property, and other categories or types of Collateral do not include Excluded Assets. Notwithstanding the exclusion of As-extracted Collateral and Fixtures from the Collateral under this Security Agreement, however, the Grantors intend to grant security interests
to the Administrative Agent in certain As-extracted Collateral and Fixtures under various deeds of trust and mortgages, and the exclusion of As-extracted Collateral and Fixtures as Collateral hereunder shall have no effect upon any such grant of a security interest therein under any such deed of trust or mortgage in favor of the Administrative Agent.
“Excluded Payments” shall have the meaning set forth in Section 4.6(b)(iii) hereof.
“Exhibit” refers to a specific exhibit to this Security Agreement (unless another document is specifically referenced) as from time to time supplemented by any Assumption Agreements.
“Fixtures” shall have the meaning set forth in Article 9 of the UCC.
“General Intangible” shall have the meaning set forth in Article 9 of the UCC.
“Goods” shall have the meaning set forth in Article 9 of the UCC.
“Instrument” shall have the meaning set forth in Article 9 of the UCC.
“Inventory” shall have the meaning set forth in Article 9 of the UCC.
“Investment Property” shall have the meaning set forth in Article 9 of the UCC.
“Issuer” shall have the meaning set forth in Section 11.1 hereof.
“Letter-of-Credit Rights” shall have the meaning set forth in Article 9 of the UCC.
“Licenses” means, with respect to any Person, all of such Person’s right, title, and interest as a licensor in and to any and all licensing agreements or similar arrangements in and to its Patents, Copyrights, or Trademarks.
“Patents” means, with respect to any Person, all of such Person’s right, title, and interest (other than as a licensee) in and to: (a) any and all patents and patent applications; (b) all inventions and improvements described and claimed therein; (c) all reissues, divisions, continuations, renewals, extensions, and continuations-in-part thereof; and (d) all rights corresponding to any of the foregoing throughout the world.
“Pledged Equity” means all Equity Interests owned by any of the Grantors that constitute Collateral hereunder, whether or not evidenced by certificates physically delivered to the Administrative Agent pursuant to this Security Agreement.
“Proceeds” shall have the meaning set forth in Article 9 of the UCC and, in any event shall include, without limitation, all dividends or other income from the Pledged Equity or other Collateral, collections thereon or distributions or payments with respect thereto.
“Receivables” means the Accounts, Chattel Paper, Documents, Investment Property, Instruments and any other rights or claims to receive money which are General Intangibles or which are otherwise included as Collateral.
“Section” means a numbered section of this Security Agreement, unless another document is specifically referenced.
“Securities Account Control Agreement” means an agreement, in form and substance reasonably satisfactory to the Administrative Agent, among any Credit Party, a securities intermediary holding such Credit Party’s assets, including funds and securities, or an issuer of Securities, and the Administrative Agent with respect to collection and control of all deposits, securities and other balances held in a Securities Account maintained by any Credit Party with such securities intermediary.
“Securities Account” shall have the meaning set forth in Article 8 of the UCC. “Security” has the meaning set forth in Article 8 of the UCC.
“Stock Rights” means all dividends, instruments or other distributions and any other right or property which the Grantors shall receive or shall become entitled to receive for any reason whatsoever with respect to, in substitution for or in exchange for any Equity Interest constituting Collateral, any right to receive an Equity Interest and any right to receive earnings, in which the Grantors now have or hereafter acquire any right, issued by an issuer of such Equity Interest.
“Supporting Obligation” shall have the meaning set forth in Article 9 of the UCC.
“Trademarks” means, with respect to any Person, all of such Person’s right, title, and interest (other than as a licensee) in and to the following: (a) all trademarks (including service marks), trade names, trade dress, and trade styles and the registrations and applications for registration thereof and the goodwill of the business symbolized by the foregoing; (b) all licenses of the foregoing; (c) all renewals of the foregoing; and (d) all rights corresponding to any of the foregoing throughout the world.
“UCC” means the Uniform Commercial Code, as in effect from time to time, of the State of New York or of any other state the laws of which are required as a result thereof to be applied in connection with the attachment, perfection or priority of, or remedies with respect to, Administrative Agent’s or any Secured Party’s Lien on any Collateral.
The foregoing definitions shall be equally applicable to both the singular and plural forms of the defined terms.
ARTICLE II
GRANT OF SECURITY INTEREST
Each Grantor hereby pledges, collaterally assigns and grants to the Administrative Agent, on behalf of and for the ratable benefit of the Secured Parties, a security interest in all of its right, title and interest in, to and under all of the following items, categories and types of personal
property, whether now owned by or owing to, or hereafter acquired by or arising in favor of such Grantor (including under any trade name or derivations thereof), and whether owned or consigned by or to, or leased from or to, such Grantor, and regardless of where located (all of which will be collectively referred to as the “Collateral”):
(a) | all Accounts; |
(b) | all Chattel Paper; |
(c) | all Documents; |
(d) | all Equipment; |
(e) | all General Intangibles; |
(f) | all Goods (other than consumer goods); |
(g) | all Instruments; |
(h) | all Inventory; |
(i) | all Investment Property; |
(j) | all cash in possession of the Administrative Agent; |
(k) | all letters of credit, Letter-of-Credit Rights and Supporting Obligations; |
(l) | all Deposit Accounts; |
(m) | all Commercial Tort Claims listed on Exhibit G hereto; |
(n) | all Securities Accounts; |
(o) | all Commodity Accounts; |
(p) | all Assigned Contracts and all Hedge Agreements; and |
(q) all accessions to, substitutions for and replacements, Proceeds (including Stock Rights), insurance proceeds and products of the foregoing, together with all books and records, customer lists, credit files, computer files, programs, printouts and other computer materials and records related thereto and any General Intangibles at any time evidencing or relating to any of the foregoing;
to secure the prompt and complete payment and performance of the Obligations; provided, however, that “Collateral” shall not include any Excluded Assets; and provided further, that if and when any such item, category or type of property shall cease to be an Excluded Asset, such property shall be deemed at all times from and after such date to constitute Collateral.
ARTICLE III
REPRESENTATIONS AND WARRANTIES
Each Grantor represents and warrants to the Administrative Agent and the Secured Parties that:
3.1. Title, Perfection and Priority. The representations and warranties of the Borrower in the Credit Agreement concerning each Grantor, this Security Agreement, and the Collateral are true and correct in all material respects (without duplication of any materiality qualifier contained therein), except to the extent any such representations and warranties are expressly limited to an earlier date, in which case, such representations and warranties are true and correct in all material respects as of such specified earlier date. When financing statements have been filed in the appropriate offices against each Grantor in the locations listed on Exhibit E, the Administrative Agent will have a validly perfected first priority security interest in that Collateral of the Grantor in which a security interest may be perfected by the filing of financing statements, subject only to Permitted Encumbrances.
3.2. Type and Jurisdiction of Organization, Organizational and Identification Numbers. The type of entity of such Grantor, its state of organization, the organizational number issued to it by its state of organization and its federal employer identification number are set forth on Exhibit A.
3.3. Principal Location. Such Grantor’s mailing address and the location of its place of business (if it has only one) or its chief executive office (if it has more than one place of business), are disclosed in Exhibit A.
3.4. Deposit Accounts, Commodity Accounts and Securities Accounts. All of such Grantor’s Deposit Accounts, Commodity Accounts and Securities Accounts as of the Effective Date are listed on Exhibit B and any De Minimis Accounts as of the Effective Date are identified as such on Exhibit B.
3.5. Exact Names. Such Grantor’s name in which it has executed this Security Agreement is the exact name as it appears in such Grantor’s organizational documents, as amended, as filed with such Grantor’s jurisdiction of organization as of the Effective Date. Except as may be described in Exhibit A or in an applicable Assumption Agreement, such Grantor has not, during the past five years prior to its becoming a party hereto, conducted business under any other name or been a party to any merger or consolidation.
3.6. Letter-of-Credit Rights and Chattel Paper on Effective Date. Exhibit C lists all Letter-of-Credit Rights and Chattel Paper owned by such Grantor as of the Effective Date, if any, with a value in excess of $250,000.
3.7. No Financing Statements, Security Agreements. No financing statement describing all or any portion of the Collateral which has not lapsed or been terminated naming such Grantor as debtor has been filed or is of record in any jurisdiction except for (a) financing statements naming the Administrative Agent as the secured party, (b) financing statements with respect to Liens permitted by Section 4.1(e), (c) financing statements being terminated concurrently with the
execution of this Security Agreement, and (d) financing statements filed as a precaution to describe personal property leased to a Grantor.
3.8. | Pledged Equity. |
(a) Exhibit D sets forth a complete and accurate list of all Pledged Equity owned by such Grantor as of the Effective Date. Such Grantor is the direct, sole beneficial owner and sole holder of record of the Pledged Equity listed on Exhibit D as being owned by it, free and clear of any Liens except for Permitted Encumbrances. Such Grantor further represents and warrants that (i) all Pledged Equity owned by it is duly authorized and validly issued and, if such Pledged Equity is stock in a corporation is fully paid and non-assessable, (ii) with respect to any certificates delivered to the Administrative Agent representing Pledged Equity, either such certificates are Securities as defined in Article 8 of the UCC as a result of actions by the issuer or otherwise, or, if such certificates are not Securities, such Grantor has so informed the Administrative Agent so that the Administrative Agent may take steps to perfect its security interest therein as a General Intangible, and (iii) all such Pledged Equity held by a securities intermediary is covered by a Securities Account Control Agreement.
(b) In addition, except for any that have been obtained, as of the Effective Date, no consent, approval, authorization, or other action by, and no giving of notice, filing with, any Governmental Authority or any other Person is required for the pledge by such Grantor of such Pledged Equity pursuant to this Security Agreement or for the execution, delivery and performance of this Security Agreement by such Grantor.
(c) Except as set forth in Exhibit D, as of the Effective Date such Grantor owns 100% of the issued and outstanding Equity Interests in each issuer that has issued Pledged Equity to such Grantor.
3.10 Instruments, Securities and Documents. Exhibit D lists all Instruments, Securities (other than Equity Interests) and Documents constituting or evidencing Collateral owned by such Grantor as of the Effective Date, if any, that such Grantor is required to deliver to the Administrative Agent pursuant to Section 4.4 hereof.
ARTICLE IV COVENANTS
From the date of this Security Agreement, and thereafter until this Security Agreement is terminated, each Grantor agrees that:
4.1. | General. |
(a) Access to Records. Such Grantor will comply with Borrower’s covenants contained in Section 8.4 of the Credit Agreement concerning maintenance of books and records and provision of access to such records and the Collateral to the Administrative Agent.
(b) Authorization to File Financing Statements; Ratification. Such Grantor hereby authorizes the Administrative Agent to file financing statements and other documents describing the Collateral in order to perfect the security interests created hereby. Each Grantor hereby agrees to deliver or file such financing statements, and to take such other actions, as may from time to time be reasonably requested by the Administrative Agent in order to maintain the perfection and priority described in Section 3.1 and, if applicable and subject to the limitations herein, Control of, the Collateral owned by such Grantor. Any financing statement filed by the Administrative Agent may be filed in any filing office in any UCC jurisdiction and may (i) describe such Grantor’s Collateral (A) as all assets of the Grantor or words of similar effect, regardless of whether any particular asset comprised in the Collateral falls within the scope of Article 9 of the UCC of such jurisdiction, or (B) by any other description which reasonably approximates the description contained in this Security Agreement, and (ii) contain any other information required by Part 5 of Article 9 of the UCC for the sufficiency or filing office’s acceptance of any financing statement or amendment, including whether such Grantor is an organization, the type of organization and any organization identification number issued to such Grantor. Such Grantor also agrees to furnish any such information to the Administrative Agent promptly upon reasonable request.
(c) Further Assurances. Such Grantor will, if so reasonably requested by the Administrative Agent, furnish to the Administrative Agent, as often as the Administrative Agent reasonably requests, statements and schedules further identifying and describing the Collateral owned by it and such other reports and information in connection with its Collateral as the Administrative Agent may reasonably request, all in such detail as the Administrative Agent may reasonably specify. Such Grantor also agrees to take any and all actions necessary to defend title to the Collateral against all persons and to defend the security interest of the Administrative Agent in its Collateral and the priority thereof against any Lien not expressly permitted hereunder.
(d) Disposition of Collateral. Such Grantor will not sell, lease or otherwise dispose of the Collateral owned by it in violation of Section 9.5 of the Credit Agreement.
(e) Liens. Such Grantor will not create, incur, or suffer to exist any Lien on the Collateral owned by it except (i) the security interest created by this Security Agreement, and (ii) other Permitted Encumbrances.
(f) Other Financing Statements. Such Grantor will not authorize the filing of any financing statement naming it as debtor covering all or any portion of the Collateral owned by it, except for (i) financing statements naming the Administrative Agent as the secured party, (ii) financing statements with respect to Liens permitted by Section 4.1(e), and (iii) financing statements filed as a precaution to specifically describe personal property leased to a Grantor and permitted under the Credit Agreement. Such Grantor acknowledges that it is not authorized to file any financing statement or amendment or termination statement with respect to any financing statement naming the Administrative Agent as secured party without the prior written consent of the Administrative Agent, subject to such Grantor’s rights under Section 9-509(d)(2) of the UCC.
4.2. Electronic Chattel Paper. Upon request by the Administrative Agent at any time that an Event of Default has occurred and is continuing, such Grantor shall take all steps necessary
to grant the Administrative Agent Control of such Grantor’s electronic chattel paper in accordance with the UCC and all “transferable records” as defined in each of the Uniform Electronic Transactions Act and the Electronic Signatures in Global and National Commerce Act to the extent necessary to ensure that the aggregate value of all electronic chattel paper of all Grantors for which Control has not been granted to the Administrative Agent does not exceed $250,000.
4.3. Inventory and Equipment. Each Grantor will perform its obligations with respect to Inventory and Equipment under Section 8.8 of the Credit Agreement and under any deed of trust or mortgage that it grants to the Administrative Agent.
4.4. Delivery of Instruments, Certificated Securities, Chattel Paper and Documents. Such Grantor will (a) deliver to the Administrative Agent, (i) immediately upon the Effective Date, the originals of all certificated Securities constituting Collateral owned by it on the Effective Date (if any then exist), and (ii) thereafter, upon request by the Administrative Agent at any time that an Event of Default has occurred and is continuing, deliver to the Administrative Agent any such Chattel Paper and Instruments constituting Collateral, (b) upon the Administrative Agent’s request at any time that an Event of Default has occurred and is continuing, deliver to the Administrative Agent any Document evidencing or constituting Collateral, (c) following the Effective Date, upon receipt thereof, deliver to the Administrative Agent any certificated Securities constituting Collateral to the extent necessary to ensure that the aggregate value of all certificated Securities constituting Collateral and owned by the Grantors for which originals have not been delivered to the Administrative Agent does not exceed $250,000 and (d) upon the Administrative Agent’s request, deliver to the Administrative Agent a duly executed amendment to this Security Agreement (an “Amendment”), substantially in the form of Exhibit F hereto, pursuant to which such Grantor will identify and ratify the pledge of such additional Collateral. Such Grantor hereby authorizes the Administrative Agent to attach each Amendment to this Security Agreement and agrees that all additional Collateral owned by it set forth in such Amendments shall be considered to be part of the Collateral.
4.5. Uncertificated Pledged Equity. Such Grantor will permit the Administrative Agent from time to time to cause the appropriate issuers (and, if held with a securities intermediary, such securities intermediary) of uncertificated Securities or other types of Pledged Equity not represented by certificates owned by it with a value of $250,000 or more to xxxx their books and records with respect thereto to reflect the Lien of the Administrative Agent granted pursuant to this Security Agreement. With respect to any Pledged Equity owned by it, such Grantor will, upon request by the Administrative Agent, cause (a) the issuers of uncertificated Securities which are Pledged Equity and (b) any securities intermediary which is the holder of any such Pledged Equity, to cause the Administrative Agent to have and retain Control over such Pledged Equity. Without limiting the foregoing, such Grantor will, with respect to any such Pledged Equity held with a securities intermediary, cause such securities intermediary to enter into a Securities Account Control Agreement unless such Pledged Equity is held in a De Minimis Account.
4.6. | Pledged Equity. |
(a) Registration of Pledged Equity. After an Event of Default has occurred and is continuing, such Grantor will permit any registerable Pledged Equity owned by it to be registered
in the name of the Administrative Agent or its nominee at any time at the option of the Required Banks.
(b) | Exercise of Rights in Pledged Equity. |
(i) Subject to clause (ii) below, such Grantor shall have the right to exercise all voting rights or other rights relating to the Pledged Equity owned by it for all purposes not inconsistent with this Security Agreement, the Credit Agreement or any other Loan Paper; provided however, that no vote or other right shall be exercised or action taken which would have the effect of impairing the rights of the Administrative Agent in respect of such Pledged Equity.
(ii) Such Grantor will permit the Administrative Agent or its nominee at any time during the continuance of an Event of Default to exercise all voting rights or other rights relating to the Pledged Equity owned by it, including, without limitation, exchange, subscription or any other rights, privileges, or options pertaining to any Equity Interest or Investment Property constituting such Pledged Equity as if it were the absolute owner thereof.
(iii) Such Grantor shall be entitled to collect and receive for its own use all cash dividends and interest paid in respect of the Pledged Equity owned by it to the extent not in violation of the Credit Agreement; provided that, to the extent, if any, that any Pledged Equity is issued by a Person other than a Credit Party, the following distributions and payments (collectively referred to as the “Excluded Payments”) shall be delivered to the Administrative Agent as and to the extent required in the following subsection (iv): (A) dividends and interest paid or payable other than in cash in respect of such Pledged Equity, and instruments and other property received, receivable or otherwise distributed in respect of, or in exchange for, any such Pledged Equity; (B) dividends and other distributions paid or payable in cash in respect of such Pledged Equity in connection with a partial or total liquidation or dissolution of an issuer or in connection with a reduction of capital, capital surplus or paid-in capital of a corporate issuer; and (C) cash paid, payable or otherwise distributed, in respect of principal of, or in redemption of, or in exchange for, such Pledged Equity; provided however, that until actually paid, all rights to such distributions shall remain subject to the Lien created by this Security Agreement; and
(iv) To the extent such Collateral is required to be delivered to the Administrative Agent pursuant to the terms hereof, all Excluded Payments, whenever paid or made, shall be delivered to the Administrative Agent to hold as Pledged Equity and shall, if received by such Grantor, be received in trust for the benefit of the Administrative Agent, be segregated from the other property or funds of such Grantor, and be forthwith delivered to the Administrative Agent as Pledged Equity in the same form as so received (with any necessary endorsement).
(c) Securities. No Grantor shall permit any Equity Interest which is included within the Collateral at any time to constitute a Security or permit the issuer of any such Equity Interest to take any action to have such interests treated as a Security unless (i) all
certificates or other documents constituting such Security have been delivered to the Administrative Agent and such Security is properly defined as such under Article 8 of the UCC of the applicable jurisdiction, whether as a result of actions by the issuer thereof or otherwise, or (ii) the Administrative Agent has entered into a Securities Account Control Agreement with the issuer of such Security or with a securities intermediary relating to such Security.
4.7. Commercial Tort Claims. Such Grantor shall promptly notify the Administrative Agent of any commercial tort claim (as defined in the UCC) acquired by it that is the subject of pending litigation and that could reasonably be expected to result in a judgment or settlement in such Grantor’s favor in excess of $250,000 and, upon request by the Administrative Agent, such Grantor shall enter into an Amendment, substantially in the form of Exhibit F hereto, granting to Administrative Agent a first priority security interest in such Commercial Tort Claim.
4.8. Letter-of-Credit Rights. If such Grantor is or becomes the beneficiary of a letter of credit with a face amount in excess of $250,000, it shall promptly notify the Administrative Agent thereof and, if requested to do so by the Administrative Agent at any time that an Event of Default has occurred and is continuing, make reasonable commercial efforts to cause the issuer and/or confirmation bank to (i) consent to the assignment of the related Letter-of-Credit Rights to the Administrative Agent and (ii) agree to direct all payments thereunder to a Deposit Account subject to a Deposit Account Control Agreement, all in form and substance reasonably satisfactory to the Administrative Agent.
4.9. Control Agreements. Subject to Section 8.15 of the Credit Agreement, for each Deposit Account, Securities Account and Commodity Account (in each case, other than De Minimis Accounts) that such Grantor at any time maintains, such Grantor will, substantially contemporaneously with the opening of such Deposit Account, Securities Account or Commodity Account (in each case, other than De Minimis Accounts) (or at such later date as the Administrative Agent may agree in its sole discretion), pursuant to a Control Agreement, cause the depository bank that maintains such Deposit Account, securities intermediary that maintains such Securities Account, or commodities intermediary that maintains such Commodity Account, as applicable, to agree to comply at any time with instructions from the Administrative Agent to such depository bank, securities intermediary or commodities intermediary directing the disposition of funds from time to time credited to such Deposit Account, Securities Account or Commodity Account, without further consent of such Grantor, or take such other action as the Administrative Agent may approve in order to perfect the Administrative Agent’s security interest in such Deposit Account, Securities Account or Commodity Account. Notwithstanding the foregoing or the terms of any Control Agreement, unless an Event of Default is continuing the Administrative Agent will not enforce the terms of any Control Agreement in order to take possession of, or prevent or limit the ability of any Grantor to direct the disposition of, the funds and other assets held in any Deposit Account, Securities Account or Commodity Account.
4.10. Change of Name or Location; etc. Such Grantor shall insure that the Borrower gives the notices required in Section 8.1(r) of the Credit Agreement with respect to any change in Grantor’s name, jurisdiction of organization, or the other matters addressed in such section of the Credit Agreement.
4.11. Additional Grantors. Each Grantor agrees to cause each of its Domestic Subsidiaries (other than any Unrestricted Subsidiary) that is required to become a party to this Security Agreement pursuant to Section 5.4 of the Credit Agreement to become a Grantor for all purposes of this Security Agreement by executing and delivering an Assumption Agreement substantially in the form of Annex 1 hereto.
4.12. Certain De Minimis Accounts. Each Grantor agrees that any De Minimis Account under clause (c) of the definition of De Minimis Account shall only be used to facilitate or settle the payment of drafts presented by sellers or lessors of Mineral Interests and shall not contain any funds for any other purpose.
ARTICLE V
EVENTS OF DEFAULT AND REMEDIES
5.1 | Remedies. During the continuation of an Event of Default: |
(a) the Administrative Agent may, or at the direction of the Required Banks, shall, exercise any or all of the following rights and remedies to the fullest extent permitted under applicable law:
(i) those rights and remedies provided in this Security Agreement, the Credit Agreement, or any other Loan Paper; provided that, this Section 5.1(a) shall not be understood to limit any rights or remedies available to the Administrative Agent and the Secured Parties prior to an Event of Default;
(ii) those rights and remedies available to a secured party under the UCC (whether or not the UCC applies to the affected Collateral) or under any other applicable law (including, without limitation, any law governing the exercise of a bank’s right of setoff or bankers’ lien) when a debtor is in default under a security agreement;
(iii) the right to give notice of sole control or any other instruction under any Control Agreement and take any action therein with respect to such Collateral, and the right to endorse and collect any cash proceeds of the Collateral;
(iv) without notice, demand or advertisement of any kind to any Grantor or any other Person (except as specifically provided in Section 8.1 or elsewhere herein or in the UCC), the right to enter the premises of any Grantor where any Collateral is located (through self-help and without judicial process), the right to collect, receive, assemble, process, appropriate, sell, lease, assign, grant an option or options to purchase or otherwise dispose of, deliver, or realize upon, the Collateral or any part thereof in one or more parcels at public or private sale or sales (which sales may be adjourned or continued from time to time with or without notice and may take place at any Grantor’s premises or elsewhere), for cash, on credit or for future delivery without assumption of any credit risk, and upon such other terms as are commercially reasonable;
(v) concurrently with written notice to the applicable Grantor, the right to transfer and register in its name or in the name of its nominee the whole or any part of the Pledged Equity, to exchange certificates or instruments representing or evidencing Pledged Equity for certificates or instruments of smaller or larger denominations, to exercise the voting and all other rights as a holder with respect thereto, to collect and receive all cash dividends and other distributions made thereon and to otherwise act with respect to the Pledged Equity as though the Administrative Agent was the outright owner thereof; and
(vi) the right to discharge past due taxes, assessments, charges, fees or Liens on the Collateral (except for such Liens as are specifically permitted hereunder).
(b) The Administrative Agent, on behalf of the Secured Parties, may comply with any applicable state or federal law requirements in connection with a disposition of the Collateral and compliance will not be considered to adversely affect the commercial reasonableness of any sale of the Collateral.
(c) Upon any such public sale or sales or any such private sale or sales, the Administrative Agent shall have the right, to the extent permitted by law, to purchase for the benefit of the Administrative Agent and the Secured Parties, the whole or any part of the Collateral so sold, free of any right of equity redemption, which equity redemption the Grantor hereby expressly releases.
(d) Until the Administrative Agent is able to effect a sale, lease, or other disposition of Collateral, the Administrative Agent shall have the right, as provided under applicable law, to hold or use Collateral, or any part thereof, to the extent that it deems appropriate for the purpose of preserving or protecting the Collateral or its value, enforcing this Security Agreement or perfecting and maintaining the perfection and priority of the Administrative Agent’s security interest in the Collateral. The Administrative Agent may, if it so elects, seek the appointment of a receiver or keeper to take possession of Collateral and to enforce any of the Administrative Agent’s remedies (for the benefit of the Administrative Agent and Secured Parties), with respect to such appointment.
(e) Notwithstanding the foregoing, neither the Administrative Agent nor any Secured Party shall be required to (i) make any demand upon, or pursue or exhaust any of their rights or remedies against, any Grantor, any other obligor, guarantor, pledgor or any other Person with respect to the payment of the Obligations or to pursue or exhaust any of their rights or remedies with respect to any Collateral therefor or any direct or indirect guarantee thereof, (ii) marshal the Collateral or any guarantee of the Obligations or to resort to the Collateral or any such guarantee in any particular order, or (iii) effect a public sale of any Collateral.
(f) Each Grantor recognizes that the Administrative Agent may be unable to effect a public sale of any or all the Pledged Equity and may be compelled to resort to one or more private sales thereof in accordance with clause (a) above. Each Grantor also acknowledges that any private sale may result in prices and other terms less favorable to the seller than if such sale were a public sale and, notwithstanding such circumstances, agrees that any such private sale shall not be deemed to have been made in a commercially unreasonable manner solely by virtue of such
sale being private. The Administrative Agent shall be under no obligation to delay a sale of any of the Pledged Equity for the period of time necessary to permit any Grantor or the issuer of the Pledged Equity to register such securities for public sale under the Securities Act of 1933, as amended, or under applicable state securities laws, even if the applicable Grantor and the issuer would agree to do so.
5.2. Grantor’s Obligations Upon Default. Upon the request of the Administrative Agent during the continuance of an Event of Default, each Grantor will:
(a) assemble and make available to the Administrative Agent the Collateral and all books and records relating thereto at any place or places reasonably specified by the Administrative Agent, whether at a Grantor’s premises or elsewhere; and
(b) permit the Administrative Agent, by the Administrative Agent’s representatives and agents, to enter, occupy and use any premises where all or any part of the Collateral, or the books and records relating thereto, or both, are located, to take possession of all or any part of the Collateral or the books and records relating thereto, or both, to remove all or any part of the Collateral or the books and records relating thereto, or both, and to conduct sales of the Collateral, without any obligation to pay the Grantor for such use and occupancy.
5.3. Grant of Intellectual Property License. For the purpose of enabling the Administrative Agent to exercise the rights and remedies under this Article V at such time as the Administrative Agent shall be lawfully entitled to exercise such rights and remedies, each Grantor hereby grants to the Administrative Agent, for the benefit of the Administrative Agent and the Secured Parties, an irrevocable, nonexclusive license (exercisable without payment of royalty or other compensation to any Grantor) to use, license or sublicense, during the continuance of an Event of Default, any intellectual property rights now owned or hereafter acquired by such Grantor, and wherever the same may be located, and including in such license access to all media in which any of the licensed items may be recorded or stored and to all computer software and programs used for the compilation or printout thereof.
ARTICLE VI
ACCOUNT VERIFICATION; ATTORNEY IN FACT; PROXY
6.1. Account Verification and Collection. During the continuation of an Event of Default, the Administrative Agent shall have the right at any time at the Grantors’ expense to (a) verify the validity, amount or any other material information relating to any Accounts, including verification with the relevant Account Debtors, and (b) enforce collection of any such Accounts and to adjust, settle or compromise the amount of payment thereof, in each case to the full extent permitted by applicable law.
6.2. | Authorization for Secured Party to Take Certain Action. |
(a) Each Grantor irrevocably authorizes the Administrative Agent at any time and from time to time and appoints the Administrative Agent as its attorney in fact, to do all acts and things necessary or desirable in the Administrative Agent’s sole
discretion to preserve and protect the Collateral and perfect and maintain the perfection and priority of the Administrative Agent’s security interest in the Collateral including, without limitation, to endorse and collect any cash proceeds of the Collateral, and to contact and enter into one or more agreements with the issuers of uncertificated securities which are Pledged Equity or with securities intermediaries holding Pledged Equity as may be necessary or advisable to give the Administrative Agent Control over such Pledged Equity; provided that, this authorization shall not relieve such Grantor of any of its obligations under this Security Agreement, the Credit Agreement or under any other Loan Paper.
(b) Subject to the limitation set forth in the last sentence of this Section 6.2(b), all acts of said attorney or designee are hereby ratified and approved. The powers conferred on the Administrative Agent, for the benefit of the Administrative Agent and Secured Parties, under this Section 6.2 are solely to protect the Administrative Agent’s interests in the Collateral and shall not impose any duty upon the Administrative Agent or any Secured Party to exercise any such powers. The Administrative Agent agrees that it shall not exercise any power or authority granted to it under this Section 6.2 unless an Event of Default has occurred and is continuing.
6.3. Proxy. EACH GRANTOR HEREBY IRREVOCABLY CONSTITUTES AND APPOINTS THE ADMINISTRATIVE AGENT AS ITS PROXY AND ATTORNEY-IN-FACT TO TAKE THOSE ACTIONS WITH RESPECT TO ITS PLEDGED EQUITY THAT ARE DESCRIBED IN SECTION 4.6(b)(ii), INCLUDING THE RIGHT TO VOTE SUCH PLEDGED EQUITY, WITH FULL POWER OF SUBSTITUTION TO DO SO. IN ADDITION TO THE RIGHT TO VOTE ANY SUCH PLEDGED EQUITY, THE APPOINTMENT OF THE ADMINISTRATIVE AGENT AS PROXY AND ATTORNEY-IN-FACT SHALL INCLUDE THE RIGHT TO EXERCISE ALL OTHER RIGHTS, POWERS, PRIVILEGES AND REMEDIES TO WHICH A HOLDER OF SUCH PLEDGED EQUITY WOULD BE ENTITLED (INCLUDING GIVING OR WITHHOLDING WRITTEN CONSENTS OF SHAREHOLDERS, CALLING SPECIAL MEETINGS OF SHAREHOLDERS AND VOTING AT SUCH MEETINGS). SUCH PROXY SHALL BE EFFECTIVE, AUTOMATICALLY AND WITHOUT THE NECESSITY OF ANY ACTION (INCLUDING ANY TRANSFER OF ANY SUCH PLEDGED EQUITY ON THE RECORD BOOKS OF THE ISSUER THEREOF) BY ANY PERSON (INCLUDING THE ISSUER OF SUCH PLEDGED EQUITY OR ANY OFFICER OR AGENT THEREOF). NOTWITHSTANDING THE FOREGOING, THE ADMINISTRATIVE AGENT MAY EXERCISE THE RIGHTS AND POWERS PROVIDED IN THIS SECTION 6.3 ONLY DURING THE CONTINUANCE OF AN EVENT OF DEFAULT.
6.4. Nature of Appointment; Limitation of Duty. THE APPOINTMENT OF THE ADMINISTRATIVE AGENT AS PROXY AND ATTORNEY-IN-FACT IN THIS ARTICLE VI IS COUPLED WITH AN INTEREST AND SHALL BE IRREVOCABLE UNTIL THE DATE ON WHICH THIS SECURITY AGREEMENT IS TERMINATED IN ACCORDANCE WITH SECTION 8.13. NOTWITHSTANDING ANYTHING CONTAINED HEREIN, NEITHER THE ADMINISTRATIVE AGENT, NOR ANY SECURED PARTY, NOR ANY OF THEIR RESPECTIVE AFFILIATES, OFFICERS, DIRECTORS, EMPLOYEES, AGENTS OR REPRESENTATIVES SHALL HAVE ANY DUTY TO EXERCISE ANY RIGHT OR POWER
GRANTED HEREUNDER OR OTHERWISE OR TO PRESERVE THE SAME AND SHALL NOT BE LIABLE FOR ANY FAILURE TO DO SO OR FOR ANY DELAY IN DOING SO, EXCEPT IN RESPECT OF DAMAGES ATTRIBUTABLE SOLELY TO THEIR OWN GROSS NEGLIGENCE OR WILLFUL MISCONDUCT AS FINALLY DETERMINED BY A COURT OF COMPETENT JURISDICTION; PROVIDED THAT, IN NO EVENT SHALL THEY BE LIABLE FOR ANY PUNITIVE, EXEMPLARY, INDIRECT OR CONSEQUENTIAL DAMAGES.
ARTICLE VII
COLLECTION AND APPLICATION OF RECEIVABLES AND OTHER COLLATERAL PROCEEDS
7.1. Collection and Application of Receivables and Other Collateral Proceeds. The Administrative Agent hereby authorizes each Grantor to collect such Grantor’s Receivables, and the Administrative Agent may curtail or terminate said authority at any time after the occurrence and during the continuance of an Event of Default (but not at any other time). If required by the Administrative Agent at any time after the occurrence and during the continuance of an Event of Default, any Proceeds constituting collections of such Receivables, when collected by such Grantor, (i) shall be forthwith (and, in any event, within two Business Days) deposited by such Grantor in the exact form received, duly endorsed by such Grantor to the Administrative Agent if required, in a Collateral Account maintained under the sole dominion and control of the Administrative Agent, subject to withdrawal by the Administrative Agent for the account of the Secured Parties only as provided below in this Section 7.1, and (ii) until so turned over, shall be held by such Grantor in trust for the Secured Parties, segregated from other funds of such Grantor. Each such deposit of Proceeds of Receivables shall be accompanied by a report identifying in reasonable detail the nature and source of the payments included in the deposit. All Proceeds constituting collections of Receivables while held by the Collateral Account bank (or by any Grantor in trust for the benefit of the Secured Parties) shall continue to be collateral security for the Obligations of the applicable Grantor and shall not constitute payment thereof until applied as hereinafter provided. At any time when an Event of Default has occurred and is continuing, at the Administrative Agent’s election, the Administrative Agent may apply all or any part of the funds on deposit in the Collateral Account established by the relevant Grantor to the payment of the Obligations of such Grantor then due and owing, such application to be made as set forth below in this Section 7.1. In addition to the rights of the Secured Parties specified above with respect to payments of Receivables, if an Event of Default shall occur and be continuing, all Proceeds of Collateral received by any Grantor consisting of cash, checks and other near cash items shall be held by such Grantor in trust for the Secured Parties segregated from other funds of such Grantor, and shall, at the request of the Administrative Agent, forthwith upon receipt by such Grantor, be turned over to the Administrative Agent in the exact form received by such Grantor (duly endorsed by such Grantor to the Administrative Agent, if required). All Proceeds received by the Administrative Agent hereunder shall be held by the Administrative Agent in a Collateral Account maintained under its sole dominion and control. All Proceeds while held by the Administrative Agent in a Collateral Account (or by such Grantor in trust for the Secured Parties) shall continue to be held as collateral security for all the Obligations and shall not constitute payment thereof until applied as provided below in this Section 7.1. At any time after the occurrence and during the continuance of an Event of Default, at the Administrative Agent’s election, the Administrative
Agent may apply all or any part of Proceeds of any Grantor held in any Collateral Account in payment of the Obligations of such Grantor in such order as the Administrative Agent may elect in compliance with the Credit Agreement, and any part of such funds which the Administrative Agent elects not so to apply and deems not required as collateral security for such Obligations shall be paid over from time to time by the Administrative Agent to the Borrower or to whomsoever may be lawfully entitled to receive the same. Any balance of such Proceeds remaining after the Obligations shall have been paid in full shall be paid over to the Borrower or to whomsoever may be lawfully entitled to receive the same.
ARTICLE VIII GENERAL PROVISIONS
8.1. Waivers. As provided in Section 9-612 of the UCC, any notice of the time and place of any public sale or the time after which any private sale or other disposition of all or any part of the Collateral may be made shall be deemed sent within a reasonable time if sent to the Grantors, addressed as set forth in Article IX, after the occurrence of an Event of Default and at least ten days prior to (a) the date of any such public sale or (b) the time after which any such private sale or other disposition may be made. To the extent it may lawfully do so, each Grantor absolutely and irrevocably waives and relinquishes the benefit and advantage of, and covenants not to assert against the Administrative Agent or any Secured Party, any valuation, stay, appraisal, extension, moratorium, redemption or similar laws and any and all rights or defenses it may have as a surety now or hereafter existing which, but for this provision, might be applicable to the sale of any Collateral made under the judgment, order or decree of any court, or under the power of sale conferred by this Security Agreement, or applicable law. Except as otherwise specifically provided herein, each Grantor hereby waives presentment, demand, protest or any notice (to the maximum extent permitted by applicable law) of any kind in connection with this Security Agreement or any Collateral.
8.2. Limitation on Administrative Agent’s and any Secured Party’s Duty with Respect to the Collateral. The Administrative Agent shall have no obligation to clean-up or otherwise prepare the Collateral for sale. The Administrative Agent and each Secured Party shall use reasonable care with respect to the Collateral in its possession or under its control. Neither the Administrative Agent nor any Secured Party shall have any other duty as to any Collateral in its possession or control or in the possession or control of any agent or nominee of the Administrative Agent or such Secured Party, or any income thereon or as to the preservation of rights against prior parties or any other rights pertaining thereto.
8.3. Compromises and Collection of Collateral. The Grantors and the Administrative Agent recognize that setoffs, counterclaims, defenses and other claims may be asserted by obligors with respect to certain of the Receivables, that certain of the Receivables may be or become uncollectible in whole or in part and that the expense and probability of success in litigating a disputed Receivable may exceed the amount that reasonably may be expected to be recovered with respect to a Receivable. In view of the foregoing, each Grantor agrees that the Administrative Agent may at any time and from time to time, if an Event of Default has occurred and is continuing, compromise with the obligor on any Receivable, accept in full payment of any Receivable such amount as the Administrative Agent in its sole discretion shall determine or abandon any
Receivable, and any such action by the Administrative Agent shall be commercially reasonable so long as the Administrative Agent acts in good faith based on information known to it at the time it takes any such action.
8.4. Secured Party Performance of Debtor Obligations. Without having any obligation to do so, the Administrative Agent may during the continuance of an Event of Default perform or pay any obligation which any Grantor has agreed to perform or pay in this Security Agreement and the Grantors shall reimburse the Administrative Agent for any amounts paid by the Administrative Agent pursuant to this Section 8.4. The Grantors’ obligation to reimburse the Administrative Agent pursuant to the preceding sentence shall be included in the Obligations and payable on demand.
8.5. Specific Performance of Certain Covenants. Each Grantor acknowledges and agrees that a breach of any of the covenants contained herein will cause irreparable injury to the Administrative Agent and the Secured Parties, that the Administrative Agent and Secured Parties have no adequate remedy at law in respect of such breaches and therefore agrees that the covenants of the Grantors contained herein shall be specifically enforceable against the Grantors.
8.6. No Waiver; Amendments; Cumulative Remedies. No delay or omission of the Administrative Agent or any Secured Party to exercise any right or remedy granted under this Security Agreement shall impair such right or remedy or be construed to be a waiver of any Default or an acquiescence therein, and any single or partial exercise of any such right or remedy shall not preclude any other or further exercise thereof or the exercise of any other right or remedy. No waiver, amendment or other variation of the terms, conditions or provisions of this Security Agreement (other than any Amendment or Assumption Agreement) whatsoever shall be valid unless in writing signed by the Administrative Agent with the concurrence or at the direction of the Banks to the extent required under Section 14.2(c) of the Credit Agreement and then only to the extent in such writing specifically set forth. All rights and remedies contained in this Security Agreement or by law afforded shall be cumulative and all shall be available to the Administrative Agent and the Secured Parties until termination of this Security Agreement in accordance with Section 8.13.
8.7. Limitation by Law; Severability of Provisions. All rights, remedies and powers provided in this Security Agreement may be exercised only to the extent that the exercise thereof does not violate any applicable provision of law, and all the provisions of this Security Agreement are intended to be subject to all applicable mandatory provisions of law that may be controlling and to be limited to the extent necessary so that they shall not render this Security Agreement invalid, unenforceable or not entitled to be recorded or registered, in whole or in part. Any provision in this Security Agreement that is held to be inoperative, unenforceable, or invalid in any jurisdiction shall, as to that jurisdiction, be inoperative, unenforceable, or invalid without affecting the remaining provisions in that jurisdiction or the operation, enforceability, or validity of that provision in any other jurisdiction, and to this end the provisions of this Security Agreement are declared to be severable.
8.8. Reinstatement. This Security Agreement shall continue to be effective or be reinstated, as the case may be, if at any time payment and performance of the Obligations, or any
part thereof, is, pursuant to applicable law, rescinded or reduced in amount, or must otherwise be restored or returned by any obligee of the Obligations, whether as a “voidable preference,” “fraudulent conveyance,” or otherwise, all as though such payment or performance had not been made. In the event that any payment, or any part thereof, is rescinded, reduced, restored or returned, the Obligations shall be reinstated and deemed reduced only by such amount paid and not so rescinded, reduced, restored or returned.
8.9. Benefit of Agreement. The terms and provisions of this Security Agreement shall be binding upon and inure to the benefit of the Grantors, the Administrative Agent and the Secured Parties and their respective successors and permitted assigns (including all persons who become bound as a debtor to this Security Agreement), except that no Grantor shall have the right to assign its rights or delegate its obligations under this Security Agreement or any interest herein, without the prior written consent of the Administrative Agent. No sales of participations, assignments, transfers, or other dispositions of any agreement governing the Obligations or any portion thereof or interest therein shall in any manner impair the Lien granted to the Administrative Agent, for the benefit of the Administrative Agent and the other Secured Parties, hereunder.
8.10. Survival of Representations. All representations and warranties of the Grantors contained in this Security Agreement shall survive the execution and delivery of this Security Agreement.
8.11. Taxes and Expenses. Any taxes (other than Excluded Taxes) payable or ruled payable by Federal or State authority in respect of this Security Agreement shall be paid by the Grantors, together with interest and penalties, if any, upon and pursuant to the terms set forth in Section 13.5 of the Credit Agreement. The Grantors shall reimburse the Administrative Agent for any and all out-of-pocket expenses (including reasonable attorneys’, auditors’ and accountants’ fees) paid or incurred by the Administrative Agent in connection with the preparation, execution, delivery, administration, collection and enforcement of this Security Agreement, in each case upon and pursuant to the terms set forth in Section 14.3 of the Credit Agreement. Any and all costs and expenses incurred by the Grantors in the performance of actions required pursuant to the terms hereof shall be borne solely by the Grantors.
8.12. Headings. The title of and section headings in this Security Agreement are for convenience of reference only, and shall not govern the interpretation of any of the terms and provisions of this Security Agreement.
8.13. Termination. This Security Agreement shall continue in effect (notwithstanding the fact that from time to time there may be no Obligations outstanding) until (a) the termination of all Commitments and payment in full of all Obligations (other than contingent indemnification obligations) owing under the Loan Papers to Administrative Agent, the Banks and (unless the Letter of Credit Issuer has advised Administrative Agent that the Obligations owing to it are otherwise adequately provided for) the Letter of Credit Issuer and owing to any Secured Hedge Provider under any Obligation with respect to a Hedge Transaction (other than a Secured Hedge Provider that has advised Administrative Agent that the Obligations owing to it are otherwise adequately provided for or novated), and (b) the termination of all Hedge Transactions with
Secured Hedge Providers (other than any Secured Hedge Provider that has advised Administrative Agent that such Hedge Transactions are otherwise adequately provided for or novated).
8.14. Entire Agreement. This Security Agreement, the Credit Agreement, and the other Loan Papers embody the entire agreement and understanding between the Grantors and the Administrative Agent relating to the Collateral and supersede all prior agreements and understandings between the Grantors and the Administrative Agent relating to the Collateral.
8.15. CHOICE OF LAW. THIS SECURITY AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.
8.16. CONSENT TO JURISDICTION. EACH PARTY HERETO HEREBY IRREVOCABLY SUBMITS TO THE NON-EXCLUSIVE JURISDICTION OF ANY UNITED STATES FEDERAL OR NEW YORK STATE COURT, IN EITHER CASE, SITTING IN NEW YORK COUNTY, NEW YORK IN ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS SECURITY AGREEMENT OR ANY OTHER LOAN PAPER AND EACH PARTY HERETO HEREBY IRREVOCABLY AGREES THAT ALL CLAIMS IN RESPECT OF SUCH ACTION OR PROCEEDING MAY BE HEARD AND DETERMINED IN ANY SUCH COURT AND IRREVOCABLY WAIVES ANY OBJECTION IT MAY NOW OR HEREAFTER HAVE AS TO THE VENUE OF ANY SUCH SUIT, ACTION OR PROCEEDING BROUGHT IN SUCH A COURT OR THAT SUCH COURT IS AN INCONVENIENT FORUM. NOTHING HEREIN SHALL LIMIT THE RIGHT OF THE ADMINISTRATIVE AGENT OR ANY SECURED PARTY OR GRANTOR TO BRING PROCEEDINGS IN THE COURTS OF ANY OTHER JURISDICTION.
8.17. WAIVER OF JURY TRIAL. EACH GRANTOR, THE ADMINISTRATIVE AGENT AND EACH SECURED PARTY HEREBY WAIVE TRIAL BY JURY IN ANY JUDICIAL PROCEEDING INVOLVING, DIRECTLY OR INDIRECTLY, ANY MATTER (WHETHER SOUNDING IN TORT, CONTRACT OR OTHERWISE) IN ANY WAY ARISING OUT OF, RELATED TO, OR CONNECTED WITH THIS SECURITY AGREEMENT OR ANY OTHER LOAN PAPER OR THE RELATIONSHIP ESTABLISHED THEREUNDER.
8.18. Indemnity. Section 14.3 of the Credit Agreement is hereby incorporated by reference mutatis mutandis, as if stated verbatim herein as agreements and obligations of each Grantor.
8.19. Counterparts. This Security Agreement may be executed in any number of counterparts, all of which taken together shall constitute one agreement, and any of the parties hereto may execute this Security Agreement by signing any such counterpart. Delivery of an executed counterpart of a signature page of this Security Agreement by facsimile or other electronic transmission (e.g. .pdf) shall be effective as delivery of a manually executed counterpart of this Security Agreement.
8.20. Lien Absolute. No Grantor that is a Guarantor shall be released from its obligations hereunder by reason of:
(a) any extension, renewal, settlement, compromise, waiver or release in respect of any of the Obligations, by operation of law or otherwise, or any obligation of any other guarantor of any of the Obligations, or any default, failure or delay, willful or otherwise, in the payment or performance of the Obligations;
(b) any lack of validity or enforceability relating to or against the Borrower, any other Credit Party or any other guarantor of any of the Obligations, for any reason related to the Credit Agreement, any other Loan Paper or any other agreement or instrument governing or evidencing any Obligations, or any Laws purporting to prohibit the payment by the Borrower, any other Credit Party or any other guarantor of the Obligations of the principal of or interest on the Obligations;
(c) any modification or amendment of or supplement to the Credit Agreement or any other Loan Paper;
(d) any change in the time, manner or place of payment of, or in any other term of, all or any part of the Obligations, or any other amendment or waiver of or any consent to any departure from the Credit Agreement, any other Loan Paper or any other agreement or instrument governing or evidencing any Obligations, including any increase or decrease in the rate of interest thereon;
(e) any change in the corporate existence, structure or ownership of the Borrower, any other Credit Party or any other guarantor of any of the Obligations, or any insolvency, bankruptcy, reorganization or other similar proceeding affecting the Borrower, any other Credit Party or any other guarantor of the Obligations, or any of their assets or any resulting release or discharge of any obligation of the Borrower, any other Credit Party or any other guarantor or any of the Obligations;
(f) any present or future law, regulation or order of any jurisdiction (whether of right or in fact) or of any agency thereof purporting to reduce, amend, restructure or otherwise affect any term of any Loan Paper or Obligations;
(g) any other setoff, defense or counterclaim whatsoever (in any case, whether based on contract, tort or any other theory) with respect to the Credit Agreement, any other Loan Paper, any other agreement or instrument or the transactions contemplated thereby which might constitute a legal or equitable defense available to, or discharge of any Guarantor, other than payment or performance of the Obligations; or
(h) any other act or omission to act or delay of any kind by the Borrower, any other Credit Party, any other guarantor of the Obligations, the Administrative Agent, any Bank or any other Person or any other circumstance whatsoever which might, but for the provisions of this paragraph, constitute a legal or equitable discharge of any Guarantor’s obligations hereunder, other than payment or performance of the Obligations;
in each case to the extent permitted by applicable law, and except in each case to the extent that any written amendment, settlement, compromise, waiver or release expressly modifies or terminates the obligations of such Grantor.
8.21. Release. Each Grantor that is a Guarantor consents and agrees that the Administrative Agent may at any time, or from time to time, in compliance with the Credit Agreement and otherwise in its discretion:
(a) renew, extend or change the time of payment, and/or the manner, place or terms of payment of all or any part of the Obligations; and
(b) exchange, release and/or surrender all or any of the Collateral (including the Pledged Equity), or any part thereof, by whomsoever deposited, which is now or may hereafter be held by the Administrative Agent in connection with all or any of the Obligations; all in such manner and upon such terms as the Administrative Agent may deem proper, and without notice to or further assent from any Grantor that is a Guarantor, it being hereby agreed that each such Guarantor shall be and remain bound upon this Security Agreement, irrespective of the value or condition of any of the Collateral, and notwithstanding any such change, exchange, settlement, compromise, surrender, release, renewal or extension, and notwithstanding also that the Obligations may, at any time, exceed the aggregate principal amount thereof set forth in the Credit Agreement, or any other agreement governing any Obligations.
ARTICLE IX NOTICES
9.1. Sending Notices. Any notice required or permitted to be given under this Security Agreement shall be given in accordance with Section 14.1 of the Credit Agreement, with each notice to each Grantor other than the Borrower being given in the same manner as notice to the Borrower under the Credit Agreement, provided that such notice shall in each case be addressed to such Grantor at its notice address set forth on Exhibit A.
9.2. Change in Address for Notices. Each of the Grantors, the Administrative Agent and the Banks may change the address for service of notice upon it by a notice in writing to the other parties.
ARTICLE X
THE ADMINISTRATIVE AGENT
Xxxxx Fargo Bank, N.A. has been appointed Administrative Agent for the Secured Parties hereunder pursuant to Article XII of the Credit Agreement. It is expressly understood and agreed by the parties to this Security Agreement that any authority conferred upon the Administrative Agent hereunder is subject to the terms of the delegation of authority made by the Secured Parties to the Administrative Agent pursuant to the Credit Agreement, and that the Administrative Agent has agreed to act (and any successor Administrative Agent shall act) as such hereunder only on the express conditions contained in such Article XII. Any successor Administrative Agent appointed pursuant to Article XII of the Credit Agreement shall be entitled to all the rights, interests and benefits of the Administrative Agent hereunder.
ARTICLE XI CONSENT TO PLEDGED EQUITY
11.1 Each Grantor, in its respective capacity as an issuer of Pledged Equity (in such capacity, an “Issuer”), hereby (a) consents to the grant by each other Grantor to the Administrative Agent, for the benefit of the Secured Parties, of a security interest in and lien on all of the Pledged Equity, (b) represents to the Administrative Agent that it has no rights of setoff or other claims against any of the Pledged Equity, (c) acknowledges and agrees that it shall, upon demand by the Administrative Agent, pay to the Administrative Agent, for the benefit of the Secured Parties, any dividends and distributions due to any Grantor in accordance with the terms hereof, and (d) consents to the transfer of such Pledged Equity to the Administrative Agent or its nominee during the continuance of an Event of Default and to the substitution of the Administrative Agent or its nominee as a partner in any partnership or as a member in any limited liability company with all the rights and powers related thereto.
11.2 Each Grantor hereby authorizes and instructs each Issuer to comply with any instruction received by it from the Administrative Agent in writing that (a) states that an Event of Default has occurred and is continuing and (b) is otherwise in accordance with the terms of this Security Agreement, without any other or further instructions from such Grantor.
[Signature Pages Follow]
IN WITNESS WHEREOF, the Grantors and the Administrative Agent have executed this Security Agreement as of the date first above written.
GRANTORS:
XXXXXXX RESOURCES, LLC,
a Delaware limited liability company
By: Name:
Title:
XXXXXXX MINERALS, LLC,
a Delaware limited liability company
By: Name:
Title:
XXXXXXX MINERALS, LLC,
a Delaware limited liability company
By: Name:
Title:
XXXXXXX RESOURCES MANAGEMENT HOLDINGS, INC.,
a Delaware corporation
By: Name:
Title:
XXXXXXX RESOURCES MANAGEMENT, LLC,
a Delaware limited liability company
By: Name:
Title:
ADMINISTRATIVE AGENT:
XXXXX FARGO BANK, N.A.,
as Administrative Agent
By: Name:
Title:
EXHIBIT A
(See Sections 3.2, 3.3, 3.5 and 9.1 of Security Agreement)
NOTICE ADDRESS FOR ALL GRANTORS:
c/o Brigham Resources, LLC 0000 X. Xxxxxxxxx Xx., Xxxxx 000
Xxxxxx, XX 00000
Attention: Xxxxx Xxxxxxxx, Chief Financial Officer Fax: (000) 000-0000
ENTITY INFORMATION
Xxxxxxx Resources, LLC
I. | Name of Grantor: Xxxxxxx Resources, LLC |
II. | State of Incorporation or Organization: Delaware |
III. | Type of Entity: Limited Liability Company |
IV. | Organizational Number assigned by State of Incorporation or Organization: 5311033 |
V. | Federal Identification Number: 00-0000000 |
VI. | Principal Place of Business and Mailing Address: Same as Notice Address above. |
VII. | Other Names and Mergers or Consolidations During the Five Years Prior to the Effective Date for such Grantor: Xxxxxxx Resources, LLC merged with its indirect subsidiary Xxxxxxx Merger Sub, LLC (with Xxxxxxx Resources, LLC surviving the merger) in November 2018 in connection with an internal reorganization. The end result was Xxxxxxx Resources, LLC became a wholly-owned subsidiary of Xxxxxxx Minerals Holdings, LLC, which was a wholly-owned subsidiary of Xxxxxxx Equity Holdings, LLC, and the former members of Xxxxxxx Resources, LLC became the members of Xxxxxxx Equity Holdings, LLC. |
Xxxxxxx Minerals, LLC
I. | Name of Grantor: Xxxxxxx Minerals, LLC |
II. | State of Incorporation or Organization: Delaware |
III. | Type of Entity: Limited Liability Company |
IV. | Organizational Number assigned by State of Incorporation or Organization: 5229294 |
V. | Federal Identification Number: 46–1225868 |
VI. | Principal Place of Business and Mailing Address: Same as Notice Address above. |
VII. | Other Names and Mergers or Consolidations During the Five Years Prior to the Effective Date for such Grantor: None. |
Xxxxxxx Minerals, LLC
I. | Name of Grantor: Xxxxxxx Minerals, LLC |
II. | State of Incorporation or Organization: Delaware |
III. | Type of Entity: Limited Liability Company |
IV. | Organizational Number assigned by State of Incorporation or Organization: 5263424 |
V. | Federal Identification Number: 46–1614946 |
VI. | Principal Place of Business and Mailing Address: Same as Notice Address above. |
VII. | Other Names and Mergers or Consolidations During the Five Years Prior to the Effective Date for such Grantor: None. |
Xxxxxxx Resources Management Holdings, Inc.
I. | Name of Grantor: Xxxxxxx Resources Management Holdings, Inc. |
II. | State of Incorporation or Organization: Delaware |
III. | Type of Entity: Corporation |
IV. | Organizational Number assigned by State of Incorporation or Organization: 5311036 |
V. | Federal Identification Number: 00-0000000 |
VI. | Principal Place of Business and Mailing Address: Same as Notice Address above. |
VII. | Other Names and Mergers or Consolidations During the Five Years Prior to the Effective Date for such Grantor: None. |
Xxxxxxx Resources Management, LLC
I. | Name of Grantor: Xxxxxxx Resources Management, LLC |
II. | State of Incorporation or Organization: Delaware |
III. | Type of Entity: Limited Liability Company |
IV. | Organizational Number assigned by State of Incorporation or Organization: 5311040 |
V. | Federal Identification Number: 00-0000000 |
VI. | Principal Place of Business and Mailing Address: Same as Notice Address above. |
VII. | Other Names and Mergers or Consolidations During the Five Years Prior to the Effective Date for such Grantor: None. |
EXHIBIT B
(See Section 3.4 of Security Agreement)
DEPOSIT ACCOUNTS
Name of Grantor | Name of Institution | Account Number | Description of Account | De Minimis Account as of the Effective Date (Yes / No) |
Xxxxxxx Resources, LLC | Xxxxx Fargo Bank, N.A. | 7836956339 | Operating | No |
Xxxxxxx Minerals, LLC | Xxxxx Fargo Bank, N.A. | 5156747320 | Operating | No |
Xxxxxxx Minerals, LLC | NBC Bank | 3200078652 | Operating | Yes |
Xxxxxxx Minerals, LLC | Xxxxx Fargo Bank, N.A. | 5156746843 | Operating | No |
Xxxxxxx Minerals, LLC | NBC Bank | 3200041650 | Operating | Yes |
Xxxxxxx Resources Management, LLC | Xxxxx Fargo Bank, N.A. | 7836956305 | Operating | No |
COMMODITY ACCOUNTS
Name of Grantor | Name of Institution | Account Number | Description of Account | De Minimis Accounts as of the Effective Date (Yes / No) |
Nothing to disclose. | ||||
SECURITIES ACCOUNTS
Name of Grantor | Name of Institution | Account Number | Description of Account | De Minimis Accounts as of the Effective Date (Yes / No) |
Nothing to disclose. | ||||
EXHIBIT C
(See Section 3.6 of Security Agreement)
LETTER OF CREDIT RIGHTS
None.
CHATTEL PAPER
None.
EXHIBIT D
(See Section 3.8 and Section 3.9 of Security Agreement and Definition of “Pledged Equity”) LIST OF PLEDGED EQUITY, SECURITIES AND OTHER INVESTMENT PROPERTY PLEDGED EQUITY
Name of Grantor | Issuer | Certificate Number(s) | Number of Shares | Type of Equity Interests | Percentage of Outstanding Equity Interests Owned by Grantor |
Xxxxxxx Resources, LLC | Xxxxxxx Minerals, LLC | N/A | N/A | LLC Membership Interests | 100% |
Xxxxxxx Resources, LLC | Xxxxxxx Minerals, LLC | N/A | N/A | LLC Membership Interests | 100% |
Xxxxxxx Resources, LLC | Xxxxxxx Resources Management Holdings, Inc. | N/A | 1,000 (uncertificated) | Common Stock | 100% |
Xxxxxxx Resources, LLC | Xxxxxxx Resources Management, LLC | 1 | 999 | LLC Membership Interests | 99.9% |
Xxxxxxx Resources Management Holdings, Inc. | Xxxxxxx Resources Management, LLC | 2 | 1 | LLC Membership Interests | 0.1% |
OTHER INSTRUMENTS, SECURITIES AND DOCUMENTS
Name of Grantor | Issuer | Number | Face Amount | Coupon Rate | Maturity |
Nothing to disclose. | |||||
EXHIBIT E
(See Section 3.1 of Security Agreement)
FILING OFFICES
Name of Grantor | Filing Office |
Xxxxxxx Resources, LLC | Delaware Secretary of State |
Xxxxxxx Minerals, LLC | Delaware Secretary of State |
Xxxxxxx Minerals, LLC | Delaware Secretary of State |
Xxxxxxx Resources Management Holdings, Inc. | Delaware Secretary of State |
Xxxxxxx Resources Management, LLC | Delaware Secretary of State |
EXHIBIT F
(See Section 4.4 and Section 4.7 of Security Agreement)
AMENDMENT
Reference is made to that certain Pledge and Security Agreement, dated May 16, 2019, by and among the undersigned, the other Grantors from time to time party thereto, and Xxxxx Fargo Bank, N.A., as the Administrative Agent (as amended, restated, supplemented or otherwise modified from time to time, the “Security Agreement”).
This Amendment, dated , (the “Effective Date”) is delivered pursuant to Section [4.4] [4.7] of the Security Agreement. All defined terms herein shall have the meanings ascribed thereto or incorporated by reference in the Security Agreement.
The undersigned hereby agrees that this Amendment may be attached to the Security Agreement and that the Collateral listed on Schedule I to this Amendment shall be and become a part of the Collateral referred to in the Security Agreement and shall secure all Obligations referred to in the Security Agreement.
By: Name: Title:
SCHEDULE I TO AMENDMENT
PLEDGED EQUITY
Name of Grantor | Issuer | Certificate Number(s) | Number of Shares | Type of Equity Interests | Percentage of Outstanding Equity Interests Owned by Grantor |
OTHER INSTRUMENTS, SECURITIES AND DOCUMENTS
Name of Grantor | Issuer | Number | Face Amount | Coupon Rate | Maturity |
COMMERCIAL TORT CLAIMS
Name of Grantor | Description of Claim | Parties | Case Number; Name of Court where Case was Filed |
EXHIBIT G
COMMERCIAL TORT CLAIMS AS OF THE EFFECTIVE DATE
Name of Grantor | Description of Claim | Parties | Case Number; Name of Court where Case was Filed |
None. | |||
Annex 1 to Pledge and Security Agreement
ASSUMPTION AGREEMENT (this “Assumption Agreement”), dated as of
, 20 , by , a
(the “Additional Grantor”), in favor of XXXXX FARGO BANK, N.A., as Administrative Agent (in such capacity, the “Administrative Agent”) for the Secured Parties. All capitalized terms not defined herein shall have the meaning ascribed to them in the Credit Agreement referred to below.
PRELIMINARY STATEMENTS
X. XXXXXXX RESOURCES, LLC, a Delaware limited liability company (the “Borrower”), the Banks and the Administrative Agent have entered into that certain Credit Agreement, dated as of May 16, 2019 (as amended, restated, supplemented or otherwise modified from time to time, the “Credit Agreement”).
B. In connection with the Credit Agreement, the Borrower and/or certain other Credit Parties are party to (i) that certain Pledge and Security Agreement, dated as of May 16, 2019 (as amended, restated, supplemented or otherwise modified from time to time, the “Security Agreement”), and (ii) that certain Guaranty Agreement, dated as of May 16, 2019 (as amended, restated or otherwise modified from time to time, the “Guaranty”), in favor of the Administrative Agent for the benefit of the Secured Parties.
C. The Credit Agreement requires the Additional Grantor to become a party to the Security Agreement and the Guaranty.
D. The Additional Grantor has agreed to execute and deliver this Assumption Agreement in order to become a party to the Security Agreement and the Guaranty.
ACCORDINGLY, IT IS AGREED:
1. Security Agreement. By executing and delivering this Assumption Agreement, the Additional Grantor, as provided in Section 4.11 of the Security Agreement, hereby becomes a party to the Security Agreement as a “Grantor” thereunder with the same force and effect as if originally named therein as a Grantor and, without limiting the generality of the foregoing, hereby expressly assumes all obligations and liabilities of a Grantor thereunder and grants a security interest to the Administrative Agent, as provided therein, in all of its right, title and interest in and to the Collateral to secure the prompt and complete payment and performance of the Obligations. The information set forth in Annex 1-A hereto is hereby added to the information set forth in the appropriate Exhibits to the Security Agreement. The Additional Grantor hereby represents and warrants that each of the representations and warranties contained in Article III of the Security Agreement is, as to itself, true and correct on and as the date hereof (after giving effect to this Assumption Agreement) as if made on and as of such date.
2. Guaranty. By executing and delivering this Assumption Agreement, the Additional Grantor, as provided in Paragraph 27 of the Guaranty, hereby becomes a party to the Guaranty as
a “Guarantor” thereunder with the same force and effect as if originally named therein as a Guarantor and, without limiting the generality of the foregoing, hereby expressly assumes all obligations and liabilities of a Guarantor thereunder. The Additional Grantor hereby represents and warrants that each of the representations and warranties contained in Paragraph 10 of the Guaranty is, as to itself, true and correct on and as the date hereof (after giving effect to this Assumption Agreement) as if made on and as of such date.
3. GOVERNING LAW. THIS ASSUMPTION AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES UNDER THIS ASSUMPTION AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.
IN WITNESS WHEREOF, the undersigned has caused this Assumption Agreement to be duly executed and delivered as of the date first above written.
[ADDITIONAL GRANTOR]
, a
By: Name: Title:
EXHIBIT H
FORM OF FACILITY GUARANTY
[See attached.]
Exhibit H-1
Form of Facility Guaranty
GUARANTY AGREEMENT
This GUARANTY AGREEMENT (as it may be amended, restated, supplemented or modified from time to time, this “Guaranty”), dated as of May 16, 2019, is made by each of the undersigned identified on the signature pages hereto as guarantors (together with any other entity that may become a party hereto as provided herein, each a “Guarantor”, and collectively, the “Guarantors”), in favor of XXXXX FARGO BANK, N.A., as Administrative Agent for the benefit of the Secured Parties and each of their successors and assigns as permitted pursuant to the Credit Agreement (Administrative Agent, the Secured Parties, and such successors and assigns, collectively, the “Beneficiaries”).
PRELIMINARY STATEMENTS
X. Xxxxxxx Resources, LLC, a Delaware limited liability company (“Borrower”), Administrative Agent, the banks and other financial institutions party thereto as “Banks” (the “Banks”) and the other agents party thereto executed that certain Credit Agreement dated as of May 16, 2019 (as amended, restated, replaced, supplemented or otherwise modified from time to time, the “Credit Agreement”), pursuant to which the Banks agreed to make loans and other extensions of credit to Borrower for the purposes set forth therein (unless otherwise defined herein, all terms used herein with their initial letter capitalized shall have the meaning given such terms in the Credit Agreement).
B. The Banks have required, as a condition to continuing to extend credit under the Credit Agreement, that each Guarantor execute and deliver this Guaranty to guarantee the payment and performance of the Obligations.
C. Each Guarantor has determined that valuable benefits will be derived by it as a result of the Credit Agreement and the extension of credit made (and to be made) by the Banks thereunder.
D. Each Guarantor has further determined that the benefits accruing to it from the Credit Agreement exceed such Guarantor’s anticipated liability under this Guaranty.
Accordingly, for valuable consideration, the receipt and sufficiency of which are hereby acknowledged and confessed, each Guarantor hereby covenants and agrees in favor of Administrative Agent for the benefit of the Secured Parties as follows:
1. Each Guarantor hereby absolutely and unconditionally guarantees the prompt, complete and full payment when due, no matter how such shall become due, of the Obligations, and further guarantees that Borrower will properly and timely perform the Obligations and other obligations and liabilities of the Credit Parties under the Credit Agreement, Notes and any other Loan Papers. This Guaranty shall continue in effect (notwithstanding the fact that from time to time there may be no Obligations outstanding) until (a) the termination of all Commitments and payment in full of all Obligations (other than contingent indemnification obligations) owing under the Loan Papers to Administrative Agent, the Banks and (unless the Letter of Credit Issuer has advised Administrative Agent that the Obligations owing to it are otherwise adequately provided for) the Letter of Credit Issuer and owing to any Secured Hedge Provider under any Obligation with respect to a Hedge Transaction (other than a Secured Hedge Provider that has advised
1
Administrative Agent that the Obligations owing to it are otherwise adequately provided for or novated), and (b) the termination of all Hedge Transactions with Secured Hedge Providers (other than any Secured Hedge Provider that has advised Administrative Agent that such Hedge Transactions are otherwise adequately provided for or novated).
2. Each Guarantor covenants that, so long as any Bank has any Commitment or any Outstanding Revolving Credit under the Credit Agreement, it will, and, if necessary, will enable Borrower to, fully comply with the applicable conditions, covenants, and agreements set forth in the Credit Agreement. Notwithstanding any contrary provision in this Guaranty, however, each Guarantor’s maximum liability under this Guaranty is limited, to the extent, if any, required so that its liability is not subject to avoidance under applicable Debtor Relief Laws (as such term is defined in Paragraph 10 hereof).
3. If any Guarantor is or becomes liable for any indebtedness owing by any Credit Party to any Beneficiary by endorsement or otherwise other than under this Guaranty, such liability shall not be in any manner impaired or affected hereby, and the rights of Beneficiaries hereunder shall be cumulative of any and all other rights that Beneficiaries may ever have against any Guarantor. The exercise by any Beneficiary of any right or remedy hereunder or under any other instrument, at law or in equity, shall not preclude the concurrent or subsequent exercise of any other right or remedy.
4. All obligations of each Guarantor hereunder, shall be absolute and unconditional irrespective of:
(a) any extension, renewal, settlement, compromise, waiver or release in respect of any of the Obligations, by operation of law or otherwise, or any obligation of any other guarantor of any of the Obligations, or any default, failure or delay, willful or otherwise, in the payment or performance of the Obligations;
(b) any lack of validity or enforceability relating to or against Borrower, any other Credit Party or any other guarantor of any of the Obligations, for any reason related to the Credit Agreement, any other Loan Papers or any other agreement or instrument governing or evidencing any Obligations, or any Laws purporting to prohibit the payment by Borrower, any other Credit Party or any other guarantor of the Obligations of the principal of or interest on the Obligations;
(c) any modification or amendment of or supplement to the Credit Agreement or any other Loan Paper;
(d) any change in the time, manner or place of payment of, or in any other term of, all or any part of the Obligations, or any other amendment or waiver of or any consent to any departure from the Credit Agreement, any other Loan Paper or any other agreement or instrument governing or evidencing any Obligations, including any increase or decrease in the rate of interest thereon;
(e) any release, nonperfection or invalidity of any direct or indirect security for any obligation of any Credit Party under the Credit Agreement or any other Loan Paper or any obligations of any other guarantor of any of the Obligations, any amendment or waiver of, or
consent to departure from, any other guaranty or support document, any exchange, release or non- perfection of any Mortgaged Property or other collateral pursuant to the Security Instruments, for all or any of the Loan Papers or Obligations, or any action or failure to act by Administrative Agent, any Bank or any Affiliate of any Bank with respect to any Mortgaged Property or other collateral securing all or any part of the Obligations;
(f) any change in the legal existence, structure or ownership of Borrower, any other Credit Party or any other guarantor of any of the Obligations, or any insolvency, bankruptcy, reorganization or other similar proceeding affecting Borrower, any other Credit Party or any other guarantor of the Obligations, or any of their assets or any resulting release or discharge of any obligation of Borrower, any other Credit Party or any other guarantor of the Obligations;
(g) any present or future law, regulation or order of any jurisdiction (whether of right or in fact) or of any agency thereof purporting to reduce, amend, restructure or otherwise affect any term of any Loan Paper or Obligations;
(h) any other setoff, defense or counterclaim whatsoever (in any case, whether based on contract, tort or any other theory) with respect to the Credit Agreement, any other Loan Paper, any other agreement or instrument or the transactions contemplated thereby which might constitute a legal or equitable defense available to, or discharge of, Borrower or any Guarantor, other than payment or performance of the Obligations; or
(i) any other act or omission to act or delay of any kind by Borrower, any other Credit Party, any other guarantor of the Obligations, Administrative Agent, any Bank or any other Person or any other circumstance whatsoever which might, but for the provisions of this paragraph, constitute a legal or equitable discharge of any Guarantor’s obligations hereunder, other than payment or performance of the Obligations.
In each case to the extent permitted by applicable law, and except in each case to the extent that any written amendment, settlement, compromise, waiver or release expressly modifies or terminates the obligations of such Guarantor.
5. In the event of default by Borrower or any other Credit Party in payment of the Obligations, or any part thereof, when such Obligations become due, either by its terms or as the result of the exercise of any power to accelerate, each Guarantor shall, on demand, and without further notice of dishonor and without any notice having been given to such Guarantor previous to such demand of the acceptance by the Beneficiaries of this Guaranty, and without any notice having been given to such Guarantor previous to such demand of the creating or incurring of such Obligations, pay the amount due thereon to Beneficiaries at Administrative Agent’s office as set forth in the Credit Agreement, and it shall not be necessary for any Beneficiary, in order to enforce such payment by any Guarantor, first, to institute suit or exhaust its remedies against Borrower, any other Guarantor or others liable on such Obligations, to have Borrower joined with any Guarantor in any suit brought under this Guaranty or to enforce its rights against any security which shall ever have been given to secure such Obligations; provided, however, that in the event any Beneficiary elects to enforce and/or exercise any remedies it may possess with respect to any security for the Obligations prior to demanding payment from any Guarantor, such Guarantor shall
nevertheless be obligated hereunder for any and all sums still owing to Beneficiaries on the Obligations and not repaid or recovered incident to the exercise of such remedies.
6. Notice to any Guarantor of the acceptance of this Guaranty and of the making, renewing or assignment of the Obligations and each item thereof, are hereby expressly waived by each Guarantor.
7. Each payment on the Obligations shall be deemed to have been made by Borrower unless express written notice is given to Administrative Agent at the time of such payment that such payment is made by any Guarantor as specified in such notice.
8. If all or any part of the Obligations at any time are secured, each Guarantor agrees that Administrative Agent and/or the Secured Parties may at any time and from time to time, at their discretion and with or without valuable consideration, allow substitution or withdrawal of collateral or other security and release collateral or other security or compromise or settle any amount due or owing under the Credit Agreement or amend or modify in whole or in part, in accordance with the terms thereof, the Credit Agreement or any Loan Paper executed in connection with same without impairing or diminishing the obligations of each Guarantor hereunder. Each Guarantor further agrees that if any Credit Party executes in favor of any Beneficiary any collateral agreement, mortgage or other security instrument, the exercise by any Beneficiary of any right or remedy thereby conferred on such Beneficiary shall be wholly discretionary with such Beneficiary, and that the exercise or failure to exercise any such right or remedy shall in no way impair or diminish the obligation of each Guarantor hereunder. Each Guarantor further agrees that Beneficiaries and Administrative Agent shall not be liable for their failure to use diligence in the collection of the Obligations or in preserving the liability of any person liable for the Obligations, and each Guarantor hereby waives presentment for payment, notice of nonpayment, protest and notice thereof (including, notice of acceleration), and diligence in bringing suits against any Person liable on the Obligations, or any part thereof.
9. Each Guarantor agrees that Beneficiaries, in their discretion, may (a) acting through Administrative Agent, bring suit against all guarantors (including, without limitation, each Guarantor hereunder) of the Obligations jointly and severally or against any one or more of them,
(b) compound or settle with any one or more of such guarantors for such consideration as Beneficiaries may deem proper, and (c) release one or more of such guarantors from liability hereunder, and that no such action shall impair the rights of Beneficiaries to collect the Obligations (or the unpaid balance thereof) from other such guarantors of the Obligations, or any of them, not so sued, settled with or released. Each Guarantor agrees, however, that nothing contained in this paragraph, and no action by Beneficiaries permitted under this paragraph, shall in any way affect or impair the rights or the obligations of such guarantors among themselves.
10. Each Guarantor further represents and warrants to each Beneficiary that (a) such Guarantor is a corporation, limited liability company, partnership or limited partnership duly organized and validly existing under the laws of the jurisdiction of its incorporation or formation;
(b) such Guarantor possesses all requisite authority and power to authorize, execute, deliver and comply with the terms of this Guaranty; (c) this Guaranty has been duly authorized and approved by all necessary action on the part of such Guarantor and constitutes a legal, valid and binding obligation of such Guarantor enforceable in accordance with its terms, except as the enforcement
thereof may be limited by (x) applicable Debtor Relief Laws, and (y) equitable principles of general applicability; (d) the execution, delivery and compliance with this Guaranty do not violate any agreement, instrument or Law applicable to such Guarantor; (e) no approval or consent of any person or entity, including but not limited to any court or governmental authority, or any filing or registration of any kind is required for the authorization, execution, delivery or compliance with this Guaranty which has not been obtained; and (f) in executing and delivering this Guaranty, each Guarantor has (i) without reliance on Administrative Agent or any information received from Administrative Agent and based upon such documents and information it deems appropriate, made an independent investigation of the transactions contemplated hereby and Borrower, Borrower’s business, assets, operations, prospects and condition, financial or otherwise, and any circumstances which may bear upon such transactions, Borrower or the obligations and risks undertaken herein with respect to the Obligations; (ii) adequate means to obtain from Borrower on a continuing basis information concerning Borrower; (iii) full and complete access to the Loan Papers and any other documents executed in connection with the Loan Papers; and (iv) not relied and will not rely upon any representations or warranties of Administrative Agent not embodied herein or any acts heretofore or hereafter taken by Administrative Agent (including but not limited to any review by Administrative Agent of the affairs of Borrower). As used in this Guaranty, the term “Debtor Relief Laws” means the Bankruptcy Code of the United States of America and all other applicable liquidation, conservatorship, bankruptcy, moratorium, rearrangement, receivership, insolvency, reorganization, suspension of payments or similar debtor relief laws from time to time in effect affecting the rights of creditors generally.
11. Each Guarantor covenants and agrees that until the Obligations are paid and performed in full, except as otherwise provided in the Credit Agreement or unless Banks give their prior written consent to any deviation therefrom, it will duly and punctually observe and perform all covenants applicable to such Guarantor under the Credit Agreement and the other Loan Papers.
12. This Guaranty is for the benefit of the Secured Parties, their successors and permitted assigns, and in the event of an assignment by any Secured Party (or its successors or permitted assigns) of the Obligations, or any part thereof, the rights and benefits hereunder, to the extent applicable to the Obligations so assigned, may be transferred with such Obligations. This Guaranty is binding upon each Guarantor and its successors and assigns.
13. No modification, consent, amendment or waiver of any provision of this Guaranty, nor consent to any departure by any Guarantor therefrom, shall be effective unless the same shall be in writing and signed by Administrative Agent with requisite Bank approval as required under the Credit Agreement, and then shall be effective only in the specific instance and for the purpose for which given. No notice to or demand on any Guarantor in any case shall, of itself, entitle such Guarantor to any other or further notice or demand in similar or other circumstances. No delay or omission by the Beneficiaries in exercising any power or right hereunder shall impair any such right or power or be construed as a waiver thereof or any acquiescence therein, nor shall any single or partial exercise of any such power preclude other or further exercise thereof, or the exercise of any other right or power hereunder. All rights and remedies of the Beneficiaries hereunder are cumulative of each other and of every other right or remedy which the Beneficiaries may otherwise have at law or in equity or under any other contract or document, and the exercise of one or more rights or remedies shall not prejudice or impair the concurrent or subsequent exercise of other rights or remedies.
14. No provision herein or in any promissory note, instrument or any other Loan Paper executed by Borrower or any Guarantor evidencing the Obligations shall require the payment or permit the collection of interest in excess of the Maximum Lawful Rate. If any excess of interest in such respect is provided for herein or in any such promissory note, instrument, or any other Loan Paper, the provisions of this paragraph shall govern, and neither Borrower nor any Guarantor shall be obligated to pay the amount of such interest to the extent that it is in excess of the amount permitted by law. The intention of the parties being to conform strictly to any applicable federal or state usury laws now in force, all promissory notes, instruments and other Loan Papers executed by Borrower or any Guarantor evidencing the Obligations shall be held subject to reduction to the amount allowed under said usury laws as now or hereafter construed by the courts having jurisdiction.
15. If any Guarantor should breach or fail to perform any provision of this Guaranty, each Guarantor agrees to pay Beneficiaries all out-of-pocket costs and expenses (including court costs and reasonable attorneys’ fees) incurred by Beneficiaries in the enforcement hereof.
16. (a) The liability of each Guarantor under this Guaranty shall in no manner be impaired, affected or released by the insolvency, bankruptcy, making of an assignment for the benefit of creditors, arrangement, compensation, composition or readjustment of any Credit Party, or any proceedings affecting the status, legal existence or assets of any Credit Party or other similar proceedings instituted by or against any Credit Party and affecting the assets of any Credit Party.
(b) Each Guarantor acknowledges and agrees that any interest on any portion of the Obligations which accrues after the commencement of any proceeding referred to in clause
(a) above (or, if interest on any portion of the Obligations ceases to accrue by operation of law by reason of the commencement of said proceeding, such interest as would have accrued on such portion of the Obligations if said proceedings had not been commenced) shall be included in the Obligations because it is the intention of each Guarantor and the Beneficiaries that the Obligations which are guaranteed by each Guarantor pursuant to this Guaranty should be determined without regard to any rule of law or order which may relieve any Credit Party of any portion of such Obligations. Each Guarantor will, to the extent not prohibited by law from doing so, permit any trustee in bankruptcy, receiver, debtor in possession, assignee for the benefit of creditors or similar person to pay Beneficiaries or Administrative Agent, or allow the claim of Beneficiaries or Administrative Agent in respect of, any such interest accruing after the date on which such proceeding is commenced.
(c) In the event that all or any portion of the Obligations are paid by any Credit Party, the obligations of each Guarantor hereunder shall continue and remain in full force and effect or be reinstated, as the case may be, in the event that all or any part of such payment(s) are rescinded or recovered directly or indirectly from Administrative Agent or any Beneficiary as a preference, fraudulent transfer or otherwise, and any such payments which are so rescinded or recovered shall constitute Obligations for all purposes under this Guaranty.
17. Each Guarantor understands and agrees that any amounts of any Guarantor on account with any Bank may, if an Event of Default shall have occurred and be continuing, be offset to satisfy the obligations of such Guarantor hereunder.
18. Each Guarantor hereby subordinates and makes inferior any and all indebtedness now or at any time hereafter owed by any Credit Party to such Guarantor to the Obligations evidenced by the Credit Agreement and agrees if an Event of Default shall have occurred and be continuing, not to permit any Credit Party to repay, or to accept payment from any Credit Party of, such indebtedness or any part thereof without the prior written consent of Administrative Agent. Each Guarantor further agrees that, if Administrative Agent so requests while an Event of Default is continuing, such indebtedness of such Credit Party to such Guarantor shall be collected, enforced and received by such Guarantor in trust for Administrative Agent (for the benefit of the Secured Parties) and shall be paid over to Administrative Agent (for the benefit of the Secured Parties) on account of the Obligations but without reducing or affecting in any manner the liability of such Guarantor under the other provisions of this Guaranty, except to the extent of such payment.
19. Each Guarantor hereby agrees that to the extent that any Guarantor shall have paid more than its proportionate share of any payment made hereunder, such Guarantor shall be entitled to seek and receive contribution from and against any other Guarantor hereunder which has not paid its proportionate share of such payment. Each Guarantor’s right of contribution shall be subject to the terms and conditions of Paragraph 20. The provisions of this Paragraph 19 shall in no respect limit the obligations and liabilities of any Guarantor to the Secured Parties, and each Guarantor shall remain liable to the Secured Parties for the full amount guaranteed by such Guarantor hereunder.
20. Notwithstanding any payment made by any Guarantor hereunder or any set-off or application of funds of any Guarantor by any Secured Party, no Guarantor shall be entitled to be subrogated to any of the rights of any Secured Party against Borrower or any Guarantor or any collateral security or guaranty or right of offset held by any Secured Party for the payment of the Obligations, nor shall any Guarantor seek or be entitled to seek any indemnity, exoneration, participation, contribution or reimbursement from Borrower or any Guarantor in respect of payments made by such Guarantor hereunder, until all amounts owing to the Secured Parties by the Credit Parties on account of the Obligations are paid in full and the Commitments are terminated. If any amount shall be paid to any Guarantor on account of such subrogation rights at any time when all of the Obligations shall not have been paid in full, such amount shall be held by such Guarantor in trust for Administrative Agent (for the benefit of the Secured Parties), segregated from other funds of such Guarantor, and shall, forthwith upon receipt by such Guarantor, be turned over to Administrative Agent (for the benefit of the Secured Parties) in the exact form received by such Guarantor (duly endorsed by such Guarantor to Administrative Agent, if required), to be applied against the Obligations whether matured or unmatured.
21. As of the date hereof, the fair value of the property of each Guarantor (including its rights of contribution and reimbursement with respect hereto) is greater than the total amount of liabilities (including contingent and unliquidated liabilities) of such Guarantor, and each Guarantor is able to pay all of its liabilities as such liabilities mature and each Guarantor does not have unreasonably small capital within the meaning of Xxxxxxx 000, Xxxxx 00, Xxxxxx Xxxxxx Code, as amended. In computing the amount of contingent or liquidated liabilities, such liabilities have been computed at the amount which, in light of all the facts and circumstances existing as of the date hereof, represents the amount that can reasonably be expected to become an actual or matured liability.
22. If any provision of this Guaranty is held to be illegal, invalid, or unenforceable, such provision shall be fully severable, this Guaranty shall be construed and enforced as if such illegal, invalid, or unenforceable provision had never comprised a part hereof, and the remaining provisions hereof shall remain in full force and effect and shall not be affected by the illegal, invalid, or unenforceable provision or by its severance herefrom. Furthermore, in lieu of such illegal, invalid, or unenforceable provision there shall be added automatically as a part of this Guaranty a provision as similar in terms to such illegal, invalid, or unenforceable provision as may be possible and be legal, valid and enforceable.
23. (a) EXCEPT TO THE EXTENT REQUIRED FOR THE EXERCISE OF THE REMEDIES PROVIDED IN THE OTHER SECURITY INSTRUMENTS, EACH GUARANTOR HEREBY IRREVOCABLY SUBMITS TO THE NON-EXCLUSIVE JURISDICTION OF ANY UNITED STATES FEDERAL OR NEW YORK STATE COURT, IN EITHER CASE, SITTING IN NEW YORK COUNTY, NEW YORK IN ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS GUARANTY OR ANY OTHER LOAN PAPER AND EACH GUARANTOR HEREBY IRREVOCABLY AGREES THAT ALL CLAIMS IN RESPECT OF SUCH ACTION OR PROCEEDING MAY BE HEARD AND DETERMINED IN ANY SUCH COURT AND IRREVOCABLY WAIVES ANY OBJECTION IT MAY NOW OR HEREAFTER HAVE AS TO THE VENUE OF ANY SUCH SUIT, ACTION OR PROCEEDING BROUGHT IN SUCH A COURT OR THAT SUCH COURT IS AN INCONVENIENT FORUM. NOTHING HEREIN SHALL LIMIT THE RIGHT OF THE BENEFICIARIES OR GUARANTOR TO BRING PROCEEDINGS IN THE COURTS OF ANY OTHER JURISDICTION.
(b)To the extent effective under applicable law, each Guarantor hereby irrevocably consents to the service of process out of any of the aforementioned courts in any such Litigation by the delivery of copies thereof by Federal Express or other nationally recognized overnight delivery service, to each Guarantor’s office at c/o Brigham Resources, LLC, 0000 X. Xxxxxxxxx Xx., Xxxxxxxxxxx Xxxxx XX, Xxxxx 000, Xxxxxx, XX 00000, Attention of Xxxxx Xxxxxxxx, Chief Financial Officer (Facsimile No. (000) 000-0000). Nothing herein shall affect the right of the Beneficiaries or any Guarantor to serve process in any manner permitted by applicable law. As used herein, the term “Litigation” means any proceeding, claim, lawsuit or investigation (i) conducted or threatened by or before any court or governmental department, commission, board, bureau, agency or instrumentality of the United States or of any state, commonwealth, nation, territory, possession, county, parish, or municipality, whether now or hereafter constituted or existing, or (ii) pending before any public or private arbitration board or panel.
(c)To the extent that any Guarantor has or hereafter may acquire any immunity from jurisdiction of any court or from any legal process (whether through service or notice, attachment prior to judgment, attachment in aid of execution, execution or otherwise) with respect to itself or its property, such Guarantor hereby irrevocably waives such immunity in respect of its obligations under this Guaranty and the other Loan Papers.
24. THIS GUARANTY AND THE OTHER LOAN PAPERS COLLECTIVELY REPRESENT THE FINAL AGREEMENT BY AND AMONG THE ADMINISTRATIVE AGENT, THE OTHER SECURED PARTIES AND EACH GUARANTOR AND MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS, OR
SUBSEQUENT ORAL AGREEMENTS OF THE SECURED PARTIES, ADMINISTRATIVE AGENT AND EACH GUARANTOR. THERE ARE NO UNWRITTEN ORAL AGREEMENTS AMONG THE SECURED PARTIES, ADMINISTRATIVE AGENT AND EACH GUARANTOR.
25. EACH GUARANTOR, FOR ITSELF, ITS SUCCESSORS AND ASSIGNS, HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY LAW, ITS RIGHT TO A JURY TRIAL, IN ANY LITIGATION ARISING OUT OF OR IN CONNECTION WITH THIS GUARANTY OR ANY OF THE OTHER LOAN PAPERS.
26. THIS GUARANTY AND THE OTHER LOAN PAPERS SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE LAWS OF THE STATE OF NEW YORK.
27. Each Guarantor agrees to cause each of its Domestic Subsidiaries that is required to become a party to this Guaranty pursuant to Section 5.4 of the Credit Agreement to become a Guarantor for all purposes of this Guaranty upon execution and delivery by such Domestic Subsidiary of an Assumption Agreement in substantially the form of Annex 1 attached to the Security Agreement.
28. This Guaranty may be executed in counterparts (and by different parties hereto on different counterparts), each of which shall constitute an original, but all of which when taken together shall constitute a single contract. Delivery of an executed counterpart of a signature page of this Guaranty by fax or other electronic transmission (e.g., “.pdf”) shall be effective as delivery of a manually executed counterpart of this Guaranty.
29. Each Guarantor that is a Qualified ECP Guarantor hereby absolutely, unconditionally and irrevocably undertakes to provide such funds or other support as may be needed from time to time by each Credit Party (other than itself) in order for such Credit Party to honor its obligations with respect to Hedge Transactions (provided, however, that each such Guarantor shall only be liable under this Paragraph 29 for the maximum amount of such liability that can be hereby incurred without rendering its obligations under this Paragraph 29, or otherwise under this Guaranty or any Loan Paper, as it relates to such other Credit Parties, voidable under applicable law relating to fraudulent conveyance or fraudulent transfer, and not for any greater amount). The obligations of each such Guarantor under this Paragraph 29 shall remain in full force and effect until all Obligations are paid in full to the Banks and Administrative Agent, and all of the Banks’ Commitments are terminated. Each Guarantor intends that this Paragraph 29 constitute, and this Paragraph 29 shall be deemed to constitute, a “keepwell, support, or other agreement” for the benefit of each other Credit Party for all purposes of Section 1a(18)(A)(v)(II) of the Commodity Exchange Act.
[Remainder of Page Intentionally Left Blank]
EXECUTED and effective as of the date first above written.
GUARANTORS:
XXXXXXX MINERALS, LLC,
a Delaware limited liability company
By: Name:
Title:
XXXXXXX MINERALS, LLC,
a Delaware limited liability company
By: Name:
Title:
XXXXXXX RESOURCES MANAGEMENT HOLDINGS, INC.,
a Delaware corporation
By: Name:
Title:
XXXXXXX RESOURCES MANAGEMENT, LLC,
a Delaware limited liability company
By: Name:
Title:
EXHIBIT I-1
FORM OF U.S. TAX COMPLIANCE CERTIFICATE
(For Foreign Banks That Are Not Partnerships For U.S. Federal Income Tax Purposes) Reference is hereby made to the Credit Agreement dated as of May 16, 2019 (as amended,
restated, extended, supplemented or otherwise modified in writing from time to time, the “Credit
Agreement”), among Xxxxxxx Resources, LLC, a Delaware limited liability company, as Borrower, Xxxxx Fargo Bank, N.A., as Administrative Agent, and each Bank from time to time party thereto.
Pursuant to the provisions of Section 13.5 of the Credit Agreement, the undersigned hereby certifies that (i) it is the sole record and beneficial owner of the Loan(s) (as well as any Note(s) evidencing such Loan(s)) in respect of which it is providing this certificate, (ii) it is not a bank within the meaning of Section 881(c)(3)(A) of the Code, (iii) it is not a ten percent shareholder of Borrower within the meaning of Section 871(h)(3)(B) of the Code and (iv) it is not a controlled foreign corporation related to Borrower as described in Section 881(c)(3)(C) of the Code.
The undersigned has furnished Administrative Agent and Borrower with a certificate of its Foreign Bank status on IRS Form W-8BEN-E (or applicable successor form). By executing this certificate, the undersigned agrees that (1) if the information provided on this certificate changes, the undersigned shall promptly so inform Borrower and Administrative Agent, and (2) the undersigned shall have at all times furnished Borrower and Administrative Agent with a properly completed and currently effective certificate in either the calendar year in which each payment is to be made to the undersigned, or in either of the two calendar years preceding such payments.
Unless otherwise defined herein, terms defined in the Credit Agreement and used herein shall have the meanings given to them in the Credit Agreement.
[NAME OF BANK]
By: Name: Title:
Date: , 20[ ]
EXHIBIT I-2
FORM OF U.S. TAX COMPLIANCE CERTIFICATE
(For Foreign Participants That Are Not Partnerships For U.S. Federal Income Tax Purposes) Reference is hereby made to the Credit Agreement dated as of May 16, 2019 (as amended,
restated, extended, supplemented or otherwise modified in writing from time to time, the “Credit
Agreement”), among Xxxxxxx Resources, LLC, a Delaware limited liability company, as Borrower, Xxxxx Fargo Bank, N.A., as Administrative Agent, and each Bank from time to time party thereto.
Pursuant to the provisions of Section 13.5 of the Credit Agreement, the undersigned hereby certifies that (i) it is the sole record and beneficial owner of the participation in respect of which it is providing this certificate, (ii) it is not a bank within the meaning of Section 881(c)(3)(A) of the Code, (iii) it is not a ten percent shareholder of Borrower within the meaning of Section 871(h)(3)(B) of the Code, and (iv) it is not a controlled foreign corporation related to Borrower as described in Section 881(c)(3)(C) of the Code.
The undersigned has furnished its participating Bank with a certificate of its Foreign status on IRS Form W-8BEN-E (or applicable successor form). By executing this certificate, the undersigned agrees that (1) if the information provided on this certificate changes, the undersigned shall promptly so inform such Bank in writing, and (2) the undersigned shall have at all times furnished such Bank with a properly completed and currently effective certificate in either the calendar year in which each payment is to be made to the undersigned, or in either of the two calendar years preceding such payments.
Unless otherwise defined herein, terms defined in the Credit Agreement and used herein shall have the meanings given to them in the Credit Agreement.
[NAME OF PARTICIPANT]
By: Name: Title:
Date: , 20[ ]
EXHIBIT I-3
FORM OF U.S. TAX COMPLIANCE CERTIFICATE
(For Foreign Participants That Are Partnerships For U.S. Federal Income Tax Purposes) Reference is hereby made to the Credit Agreement dated as of May 16, 2019 (as amended,
restated, extended, supplemented or otherwise modified in writing from time to time, the “Credit
Agreement”), among Xxxxxxx Resources, LLC, a Delaware limited liability company, as Borrower, Xxxxx Fargo Bank, N.A., as Administrative Agent, and each Bank from time to time party thereto.
Pursuant to the provisions of Section 13.5 of the Credit Agreement, the undersigned hereby certifies that (i) it is the sole record owner of the participation in respect of which it is providing this certificate, (ii) its direct or indirect partners/members are the sole beneficial owners of such participation, (iii) with respect such participation, neither the undersigned nor any of its direct or indirect partners/members is a bank extending credit pursuant to a loan agreement entered into in the ordinary course of its trade or business within the meaning of Section 881(c)(3)(A) of the Code,
(iv)none of its direct or indirect partners/members is a ten percent shareholder of Borrower within the meaning of Section 871(h)(3)(B) of the Code and (v) none of its direct or indirect partners/members is a controlled foreign corporation related to Borrower as described in Section 881(c)(3)(C) of the Code.
The undersigned has furnished its participating Bank with IRS Form W-8IMY (or applicable successor form) accompanied by one of the following forms from each of its partners/members that is claiming the portfolio interest exemption: (i) an IRS Form W-8BEN-E (or applicable successor form) or (ii) an IRS Form W-8IMY (or applicable successor form) accompanied by an IRS Form W-8BEN-E (or applicable successor form) from each of such partner’s/member’s beneficial owners that is claiming the portfolio interest exemption. By executing this certificate, the undersigned agrees that (1) if the information provided on this certificate changes, the undersigned shall promptly so inform such Bank and (2) the undersigned shall have at all times furnished such Bank with a properly completed and currently effective certificate in either the calendar year in which each payment is to be made to the undersigned, or in either of the two calendar years preceding such payments.
Unless otherwise defined herein, terms defined in the Credit Agreement and used herein shall have the meanings given to them in the Credit Agreement.
[NAME OF PARTICIPANT]
By: Name: Title: Date: , 20[ ]
EXHIBIT I-4
FORM OF U.S. TAX COMPLIANCE CERTIFICATE
(For Foreign Banks That Are Partnerships For U.S. Federal Income Tax Purposes) Reference is hereby made to the Credit Agreement dated as of May 16, 2019 (as amended,
restated, extended, supplemented or otherwise modified in writing from time to time, the “Credit
Agreement”), among Xxxxxxx Resources, LLC, a Delaware limited liability company, as Borrower, Xxxxx Fargo Bank, N.A., as Administrative Agent, and each Bank from time to time party thereto.
Pursuant to the provisions of Section 13.5 of the Credit Agreement, the undersigned hereby certifies that (i) it is the sole record owner of the Loan(s) (as well as any Note(s) evidencing such Loan(s)) in respect of which it is providing this certificate, (ii) its direct or indirect partners/members are the sole beneficial owners of such Loan(s) (as well as any Note(s) evidencing such Loan(s)), (iii) with respect to the extension of credit pursuant to the Credit Agreement or any other Loan Paper, neither the undersigned nor any of its direct or indirect partners/members is a bank extending credit pursuant to a loan agreement entered into in the ordinary course of its trade or business within the meaning of Section 881(c)(3)(A) of the Code, (iv) none of its direct or indirect partners/members is a ten percent shareholder of Borrower within the meaning of Section 871(h)(3)(B) of the Code and (v) none of its direct or indirect partners/members is a controlled foreign corporation related to Borrower as described in Section 881(c)(3)(C) of the Code.
The undersigned has furnished Administrative Agent and Borrower with IRS Form W- 8IMY (or applicable successor form) accompanied by one of the following forms from each of its partners/members that is claiming the portfolio interest exemption: (i) an IRS Form W-8BEN-E (or applicable successor form) or (ii) an IRS Form W-8IMY (or applicable successor form) accompanied by an IRS Form W-8BEN-E (or applicable successor form) from each of such partner’s/member’s beneficial owners that is claiming the portfolio interest exemption. By executing this certificate, the undersigned agrees that (1) if the information provided on this certificate changes, the undersigned shall promptly so inform Borrower and Administrative Agent, and (2) the undersigned shall have at all times furnished Borrower and Administrative Agent with a properly completed and currently effective certificate in either the calendar year in which each payment is to be made to the undersigned, or in either of the two calendar years preceding such payments.
Unless otherwise defined herein, terms defined in the Credit Agreement and used herein shall have the meanings given to them in the Credit Agreement.
[NAME OF BANK]
By: Name: Title: Date: , 20[ ]
EXHIBIT J
FORM OF ELECTED COMMITMENT INCREASE CERTIFICATE
[ ], 20[ ]
To: Xxxxx Fargo Bank, N.A., as Administrative Agent
Xxxxxxx Resources, LLC, a Delaware limited liability company (“Borrower”), Administrative Agent and certain Banks have heretofore entered into a Credit Agreement dated as of May 16, 2019 (together with all amendments, restatements, supplements or other modifications thereto, the “Credit Agreement”). Capitalized terms used but not otherwise defined herein shall have the meaning given to such terms in the Credit Agreement.
This Elected Commitment Increase Certificate is being delivered pursuant to Section 2.15(b)(vi) of the Credit Agreement.
Please be advised that the undersigned Bank has agreed (a) to increase its Elected Commitment under the Credit Agreement effective [ ], 20[ ] (the “Increase Effective Date”) from $[ ] to $[ ] and (b) that it shall continue to be a party in all respects to the Credit Agreement and the other Loan Papers.
With reference to Section 2.15(b)(iv) of the Credit Agreement, Borrower hereby confirms that [Check Applicable Box]:
[ ] There are, or if the Increase Effective Date is after the date hereof, there will be no Eurodollar Borrowings outstanding on the Increase Effective Date.
[ ] There are, or if the Increase Effective Date is after the date hereof, there will be Eurodollar Borrowings outstanding on the Increase Effective Date and Borrower will pay any compensation required by Section 3.3 of the Credit Agreement on the Increase Effective Date.
Very truly yours,
XXXXXXX RESOURCES, LLC,
a Delaware limited liability company
By: Name: Title:
ACCEPTED AND AGREED:
XXXXX FARGO BANK, N.A.,
as Administrative Agent
By:
Name:
Title:
Accepted and Agreed:
[NAME OF INCREASING BANK]
By:
Name:
Title:
EXHIBIT K
FORM OF ADDITIONAL BANK CERTIFICATE
[ ], 20[ ]
To: Xxxxx Fargo Bank, N.A., as Administrative Agent
Xxxxxxx Resources, LLC, a Delaware limited liability company (“Borrower”), Administrative Agent and certain Banks have heretofore entered into a Credit Agreement dated as of May 16, 2019 (as amended, restated, supplemented or otherwise modified from time to time, the “Credit Agreement”). Capitalized terms used but not otherwise defined herein shall have the meaning given to such terms in the Credit Agreement.
This Additional Bank Certificate is being delivered pursuant to Section 2.15(b)(vii) of the Credit Agreement.
Please be advised that the undersigned Additional Bank has agreed (a) to become a Bank under the Credit Agreement effective [ ], 20[ ] (the “Additional Bank Effective Date”) with a Maximum Aggregate Credit Amount of $[ ] and an Elected Commitment of $[
] and (b) that it shall be a party in all respects to the Credit Agreement and the other Loan Papers.
This Additional Bank Certificate is being delivered to Administrative Agent together with
(i) if the Additional Bank is a Foreign Bank any documentation required to be delivered by such Additional Bank pursuant to Section 13.5(g) of the Credit Agreement, duly completed and executed by the Additional Bank, and (ii) an Administrative Questionnaire in the form supplied by Administrative Agent, duly completed by the Additional Bank. [The [Borrower/Additional Bank] shall pay the processing and recordation fee payable to Administrative Agent pursuant to Section 2.15(b)(vii) of the Credit Agreement.]18
With reference to Section 2.15(b)(iv) of the Credit Agreement, Borrower hereby confirms that [Check Applicable Box]:
[ ] There are, or if the Additional Bank Effective Date is after the date hereof, there will be no Eurodollar Borrowings outstanding on the Additional Bank Effective Date.
[ ] There are, or if the Additional Bank Effective Date is after the date hereof, there will be Eurodollar Borrowings outstanding on the Additional Bank Effective Date and Borrower will pay any compensation required by Section 3.3 of the Credit Agreement on the Additional Bank Effective Date.
18 Include, if applicable.
Very truly yours,
XXXXXXX RESOURCES, LLC,
a Delaware limited liability company
By: Name: Title:
ACCEPTED AND AGREED:
XXXXX FARGO BANK, N.A.,
as Administrative Agent
By:
Name:
Title:
Accepted and Agreed:
[NAME OF ADDITIONAL BANK]
By:
Name:
Title:
SCHEDULE 1
BANKS; ELECTED COMMITMENTS AND MAXIMUM CREDIT AMOUNT
Bank | Maximum Credit Amt | Elected Commitment | Applicable Percentage | |||||
Xxxxx Fargo Bank, N.A. | $125,000,000.00 | $30,000,000.00 | 25.00 | % | ||||
Credit Suisse AG, Cayman Islands Branch | $62,500,000.00 | $15,000,000.00 | 12.50 | % | ||||
Barclays Bank PLC | $62,500,000.00 | $15,000,000.00 | 12.50 | % | ||||
Compass Bank | $62,500,000.00 | $15,000,000.00 | 12.50 | % | ||||
Xxxxxxx Sachs Bank USA | $62,500,000.00 | $15,000,000.00 | 12.50 | % | ||||
Royal Bank of Canada | $62,500,000.00 | $15,000,000.00 | 12.50 | % | ||||
UBS AG, Stamford Branch | $62,500,000.00 | $15,000,000.00 | 12.50 | % | ||||
Totals: | $500,000,000.00 | $120,000,000.00 | 100.00 | % | ||||
Administrative Agent | Address for Notice |
Xxxxx Fargo Bank, N.A. | Credit Contact: 1700 Lincoln, Sixth Floor MAC: C7300-061 Xxxxxx, Xxxxxxxx 00000 Attn: Xxx Xxxxx Tel: (000) 000-0000 Fax: (000) 000-0000 Email: xxx.xxxxx@xxxxxxxxxx.xxx Primary Operations Contact: 0000 X XX Xxxxxx Xxxx. Xxxxxxxxx, XX 00000 MAC D1109-019 Attn: Syndication Agency Services Fax: 000-000-0000 |
SCHEDULE 2
LITIGATION
None.
SCHEDULE 3
ORGANIZATIONAL INFORMATION AND SUBSIDIARIES
Credit Party
Name of Credit Party | Jurisdiction of Organization | States in Which qualified to do Business as Foreign Entity |
Xxxxxxx Resources, LLC | Delaware | N/A |
Xxxxxxx Minerals, LLC | Delaware | Colorado, Oklahoma, Texas and Wyoming |
Xxxxxxx Minerals, LLC | Delaware | Colorado and North Dakota |
Xxxxxxx Resources Management Holdings, Inc. | Delaware | N/A |
Xxxxxxx Resources Management, LLC | Delaware | Texas |
Restricted Subsidiaries of Borrower
Issuer | Holder | Description of Interest | Percentage Ownership | |
Xxxxxxx Minerals, LLC | Xxxxxxx Resources, LLC | LLC Membership Interest | 100 | % |
Xxxxxxx Minerals, LLC | Xxxxxxx Resources, LLC | LLC Membership Interest | 100 | % |
Xxxxxxx Resources Management Holdings, Inc. | Xxxxxxx Resources, LLC | Common Stock | 100 | % |
Xxxxxxx Resources Management, LLC | Xxxxxxx Resources, LLC | LLC Membership Interest (Unitized) | 99.9 | % |
Xxxxxxx Resources Management, LLC | Xxxxxxx Resources Management Holdings, Inc. | LLC Membership Interest (Unitized) | 0.1 | % |
Unrestricted Subsidiaries of Borrower
None.
