Exhibit 10.4
CREDIT AGREEMENT
among
PIONEER NATURAL RESOURCES COMPANY,
Borrower
BANK OF AMERICA, N.A.,
Administrative Agent
CREDIT SUISSE FIRST BOSTON,
Documentation Agent
and
THE CHASE MANHATTAN BANK,
Syndication Agent
and certain LENDERS
May 31, 2000
$575,000,000
TABLE OF CONTENTS
ARTICLE 1 - DEFINITIONS AND REFERENCES..................................... 1
Section 1.1 Defined Terms..................................... 1
Section 1.2 Exhibits and Schedules............................ 15
Section 1.3 Amendment of Defined Instruments.................. 15
Section 1.4 References and Titles............................. 15
Section 1.5 Calculations and Determinations................... 15
ARTICLE 2 - ADVANCES AND LETTERS OF CREDIT................................. 16
Section 2.1 Making and Repaying the Revolving Loan Advances... 16
Section 2.2 Requests for Revolving Loan Advances.............. 17
Section 2.3 Rate Elections.................................... 17
Section 2.4 Swing Line Advances............................... 18
Section 2.5 Procedure for Swing Line Advances................. 19
Section 2.6 Special Provisions for Swing Line Advances........ 20
Section 2.7 Commitment Fee.................................... 21
Section 2.8 Agents' and Administrative Agent's Fees........... 21
Section 2.9 Termination and Reduction of Commitments.......... 21
Section 2.10 Optional Prepayments.............................. 22
Section 2.11 Payments to Lenders............................... 22
Section 2.12 Letters of Credit................................. 23
Section 2.13 Requesting Letters of Credit...................... 23
Section 2.14 Reimbursement of Letters of Credit................ 23
Section 2.15 Letter of Credit Fees............................. 26
Section 2.16 Capital Reimbursement............................. 26
Section 2.17 Increased Cost of Eurodollar Portions............. 27
Section 2.18 Availability...................................... 27
Section 2.19 Funding Losses.................................... 28
Section 2.20 Taxes............................................. 29
Section 2.21 Make-Whole Qualifications......................... 30
ARTICLE 3 - CONDITIONS PRECEDENT TO LENDING................................ 32
Section 3.1 Initial Conditions Precedent...................... 32
Section 3.2 Additional Conditions Precedent................... 33
ARTICLE 4 - REPRESENTATIONS AND WARRANTIES................................. 34
Section 4.1 Borrower's Representations and Warranties......... 34
Section 4.2 Representation by Lenders......................... 37
ARTICLE 5 - COVENANTS OF BORROWER.......................................... 37
Section 5.1 Affirmative Covenants............................. 37
Section 5.2 Negative Covenants................................ 41
Section 5.3 Financial Covenants............................... 43
(i)
ARTICLE 6 - EVENTS OF DEFAULT AND REMEDIES................................. 44
Section 6.1 Events of Default................................. 44
Section 6.2 Remedies.......................................... 47
Section 6.3 Annulment of Acceleration......................... 48
Section 6.4 Indemnity......................................... 48
ARTICLE 7 - AGENTS......................................................... 49
Section 7.1 Appointment and Authority......................... 49
Section 7.2 Agents' Reliance.................................. 50
Section 7.3 Lenders' Credit Decisions......................... 51
Section 7.4 Indemnification................................... 51
Section 7.5 Rights as Lender.................................. 51
Section 7.6 Sharing of Set-Offs and Other Payments............ 52
Section 7.7 Investments....................................... 52
Section 7.8 Benefit of Article 7.............................. 52
Section 7.9 Resignation and Removal........................... 53
ARTICLE 8 - MISCELLANEOUS.................................................. 53
Section 8.1 Waivers and Amendments............................ 53
Section 8.2 Survival of Agreements, Cumulative Nature......... 54
Section 8.3 Notices........................................... 54
Section 8.4 Parties in Interest............................... 55
Section 8.5 Governing Law..................................... 55
Section 8.6 Limitation on Interest............................ 55
Section 8.7 Termination: Limited Survival..................... 57
Section 8.8 Assignments, Participations....................... 57
Section 8.9 Confidentiality................................... 59
Section 8.10 Severability...................................... 59
Section 8.11 Counterparts...................................... 59
Section 8.12 WAIVER OF JURY TRIAL, PUNITIVE DAMAGES............ 59
Section 8.13 Several Obligations............................... 60
Section 8.14 Nonliability of Lenders........................... 60
Section 8.15 Setoff............................................ 60
Section 8.16 Forum Selection and Consent to Jurisdiction....... 60
Section 8.17 Release of Liens.................................. 61
Section 8.18 Entire Agreement.................................. 61
(ii)
CREDIT AGREEMENT
THIS CREDIT AGREEMENT is made as of May 31, 2000, by and among PIONEER
NATURAL RESOURCES COMPANY, a Delaware corporation (the "Borrower"), the Lenders
from time to time parties hereto, BANK OF AMERICA, N.A., as Administrative Agent
for the Lenders, CREDIT SUISSE FIRST BOSTON, as Documentation Agent for the
Lenders, and THE CHASE MANHATTAN BANK, as Syndication Agent for the Lenders.
For good and valuable consideration, the receipt and adequacy of which
are hereby acknowledged, the parties hereto agree as follows:
ARTICLE 1
DEFINITIONS AND REFERENCES
Section 1.1 Defined Terms. As used in this Agreement, each of the
following terms has the meaning given it in this section or in the sections and
subsections referred to below:
"Adjusted Eurodollar Rate" means, with respect to each particular
Eurodollar Portion and the associated Eurodollar Rate and Reserve Percentage,
the rate per annum determined hereunder by Administrative Agent pursuant to the
following formula:
AER = ER + EM
--------
1.00 - RP
AER = Adjusted Eurodollar Rate
ER = Eurodollar Rate
RP = Reserve Percentage
EM = Eurodollar Margin
The Adjusted Eurodollar Rate shall change as and when the associated
Reserve Percentage and Eurodollar Margin change.
"Administrative Agent" means Bank of America, N.A., as Administrative
Agent hereunder, and its successor in such capacity.
"Advance" means a Revolving Loan Advance or Swing Line Advance.
"Affiliate" means, as to any Person, each other Person that directly
or indirectly (through one or more intermediaries or otherwise) controls, is
controlled by, or is under common control with, such Person. A Person shall be
deemed to "control" another Person if such Person possesses, directly or
indirectly, power to (a) vote 30% or more of the securities or other equity
interests of such other Person having ordinary voting power for the election of
directors or other governing body, or (b) direct or cause the direction of the
management or policies of such other Person whether by contract or otherwise.
"Agent" means any of Administrative Agent, Collateral Agent,
Syndication Agent or Documentation Agent hereunder, solely in such capacity and
not in its capacity as a Lender.
"Agreement" means this Credit Agreement, as it may be amended,
modified or restated from time to time hereafter.
"Applicable Rating Level" means the level set forth below that
corresponds to the higher of the ratings issued from time to time by ▇▇▇▇▇'▇ and
S&P, as applicable to Borrower's senior unsecured long- term debt provided,
however, that if such ratings differ by more than one level, the Applicable
Rating Level shall be one level below the higher level:
▇▇▇▇▇'▇ S&P
------- -------
Level I >Baa3 >BBB-
- -
▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇
▇▇▇▇▇ ▇▇▇ ▇▇▇ ▇▇
Level IV " means a rating equal to or more
favorable than and "<" means a rating equal to or less favorable than; (ii) if
ratings for Borrower's senior unsecured long-term debt shall not be available
from ▇▇▇▇▇'▇ or S&P, Level IV shall be deemed applicable; (iii) if either
▇▇▇▇▇'▇ or S&P shall change its ratings nomenclature prior to the date all
Obligations have been paid and the Commitments canceled, Borrower and Lenders
shall negotiate in good faith to amend the references to specific ratings in
this definition to reflect such change, and pending such amendment, if an
appropriate Applicable Rating Level is otherwise not determinable based upon the
foregoing grid, the last Applicable Rating Level in effect at the time of such
change shall continue to apply.
"Base Rate" means the fluctuating per annum rate of interest from time
to time in effect equal to the higher of (a) the rate of interest publicly
announced by Bank of America, N.A. as its "Prime Rate" or (b) the Federal Funds
Rate plus one-half of one percent (1/2 of 1%), whether or not Borrower has
notice thereof. Such "Prime Rate" is set by Bank of America, N.A. as a general
rate of interest, taking into account such factors as Bank of America, N.A. may
deem appropriate, it being understood that many of Bank of America, N.A.'s
commercial or other loans are priced in relation to such rate, that it is not
necessarily the lowest or best rate actually charged to any customer and that
Bank of America, N.A. may make various commercial or other loans at rates of
interest having no relationship to such rate. If Bank of America, N.A.'s Prime
Rate or the Federal Funds Rate changes after the date hereof, the Base Rate
shall be automatically increased or decreased, as the case may be, without prior
notice to Borrower from time to time as of the effective time of each change in
Bank of America, N.A.'s Prime Rate or the Federal Funds Rate. Administrative
Agent shall promptly thereafter notify Borrower of each change in the Base Rate.
"Base Rate Margin" means, on any date, with respect to each Base Rate
Portion of a Revolving Loan Advance, the remainder (if positive) of (a) the then
effective Eurodollar Margin minus (b) 125 basis points per annum.
"Base Rate Portion" means that portion of the unpaid principal balance
of a Revolving Loan Advance which bears interest based on the Base Rate.
"Borrower" is defined in the Preamble hereto.
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"Business Day" means a day on which commercial banks are open for
business with the public in the State of Texas. Any Business Day in any way
relating to a Eurodollar Portion (such as the day on which a Eurodollar Interest
Period begins or ends) must also be a day on which, in the reasonable, good
faith judgment of Administrative Agent, significant transactions in dollars are
carried out in the interbank eurocurrency market.
"Cash Collateral" has the meaning given it in Section 2.14(d).
"Code" means the Internal Revenue Code of 1986, as amended from time
to time.
"Collateral Agent" means Bank of America, N.A., as collateral agent
under the Pledge Agreements and its successor in such capacity.
"Commitment" means, with respect to each Lender, the amount set forth
opposite the name of such Lender as its Commitment on Schedule 1 attached hereto
(or, if such Lender is an assignee, the amount of its Commitment set forth in
the assignment pursuant to which it became a Lender) as such amount may be
reduced or increased from time to time pursuant to any assignment to which it is
a party or otherwise pursuant to the terms of this Agreement.
"Commitment Period" means the period from and including the Effective
Date until and including the Maturity Date (or, if earlier, the day on which the
Obligations first become due and payable in full or the Commitments are
terminated upon notice by Administrative Agent to Borrower pursuant to Section
6.1).
"Commitment Fee Rate" means, for any date, the number of basis points
per annum set forth below based on the Applicable Rating Level then in effect
and the Total Leverage Ratio as of the date of the last calculation thereof:
Total Leverage Ratio
----------------------------------------
Applicable Rating Level <3.25 3.253.75
----------------------- - - -
I 25.0 25.0 37.5 37.5
II 37.5 37.5 45.0 50.0
III 50.0 50.0 50.0 50.0
IV 50.0 50.0 50.0 50.0
Changes in the Commitment Fee Rate will occur automatically without prior notice
(x) upon the effectiveness of any change of the Applicable Rating Level and (y)
three (3) days following the earlier of (A) the date Borrower delivers the
certificate in respect of the previous Fiscal Quarter required pursuant to the
second sentence of Section 5.1(b)(1) (provided that for purposes of this
definition, Borrower shall be permitted to deliver a certificate sixty (60) days
following a Fiscal Year end containing the information to be included in the
certificate to be delivered pursuant to Section 5.1(b)(1) except based upon
unaudited Financial Statements for such Fiscal Year) or Section 5.1(b)(2), as
the case may be, and (B) sixty (60) days following the end of such previous
Fiscal Quarter, in the event of a change in the Total Leverage Ratio.
Administrative Agent will give notice promptly to Borrower and Lenders of each
change in the Commitment Fee Rate.
"Consolidated" refers to the consolidation of any Person, in
accordance with GAAP, with its properly consolidated Subsidiaries. References
herein to a Person's Consolidated financial statements, financial position,
financial condition, or liabilities refer to the consolidated financial
3
statements, financial position, financial condition or liabilities, as the case
may be, of such Person and its properly consolidated Subsidiaries.
"Consolidated Interest Expense" means, for any period, the total
interest expense, whether paid or accrued, of Borrower and its Subsidiaries on a
Consolidated basis, including without limitation, all commissions, discounts and
other fees and charges owed with respect to Letters of Credit.
"Consolidated Tangible Net Worth" means, at any date, (i) the
Consolidated shareholders' equity of Borrower and its Subsidiaries (determined
in accordance with GAAP), less (ii) the amount of Consolidated intangible assets
of Borrower and its Subsidiaries, plus (iii) the aggregate amount of any
non-cash write downs under Financial Accounting Standards 19, 109 and 121, on a
Consolidated basis, by Borrower and its Subsidiaries after December 31, 1999.
"Debt" of any Person means, without duplication:
(a) indebtedness of such Person for borrowed money;
(b) indebtedness of such Person constituting an obligation to pay
the deferred purchase price of property or services (other
than customary payment terms taken in the ordinary course of
such Person's business);
(c) indebtedness of such Person evidenced by a bond, debenture,
note or similar instrument;
(d) principal obligations under leases capitalized in accordance
with GAAP under which such Person is the lessee;
(e) indebtedness, contingent or otherwise, of such Person with
respect to bankers' acceptances or the face amount of letters
of credit or applications or reimbursement agreements
therefor;
(f) guaranties of such Person of indebtedness or obligations of
the type described in clauses (a), (b), (c), (d) or (e) above
of any other Person or obligations to purchase or acquire or
to otherwise protect or insure a creditor against loss in
respect of indebtedness or obligations of the type described
in clauses (a), (b), (c), (d) or (e) above of any other
Person, but excluding endorsements in the ordinary course of
business of negotiable instruments in the course of
collection;
(g) indebtedness or obligations of the type described in clauses
(a), (b), (c), (d) or (e) above, which are secured by a Lien
on any property owned by such Person, whether or not such
indebtedness or obligations have been assumed by such Person
(limited however to the lesser of (1) the amount of its
liability or (2) the value of such property); and
(h) the undischarged balance of any Production Payment granted or
transferred by such Person or for the grant or transfer of
which such Person received payment and the amount of deferred
revenue attributable to any forward sale of production of
Properties for which such Person has received payment in
advance (other than on ordinary trade terms);
4
provided, however, Debt shall not include (1) accounts payable incurred in the
ordinary course of such Person's business, or (2) any obligations in respect of
(i) exchange, forward, future, swap, hedging or similar agreements and (ii) gas
or oil imbalances.
"Default" means any Event of Default and any default, event or
condition which would, with the giving of any requisite notices and the passage
of any requisite periods of time, constitute an Event of Default.
"Default Rate" means, at the particular time in question, two percent
(2%) per annum plus the Base Rate plus the Base Rate Margin then in effect;
provided, that, with respect to any Eurodollar Portion with a Eurodollar
Interest Period which is still in effect, "Default Rate" shall mean, during such
Eurodollar Interest Period, two percent (2%) per annum plus the Adjusted
Eurodollar Rate applicable to such Eurodollar Portion.
"Designated Entity" means Borrower and each of the Restricted
Subsidiaries.
"Designated Officer" means any Executive Officer or any other
individual duly elected to and holding one or more of the offices of vice
president, managing director, executive director, secretary or assistant
secretary of a Designated Entity, or any other Person authorized in writing by
any Designated Entity to execute any Loan Document, in each case designated by a
Designated Entity and acceptable to Required Lenders.
"Disclosure Schedule" means (a) Schedule 2 hereto and (b) any
documents listed on such schedule and expressly incorporated therein by
reference, true and correct copies of which shall have been delivered to
Administrative Agent and each Lender prior to the date hereof. Insofar as any
representations and warranties made herein are incorporated by reference or
otherwise remade in Loan Documents delivered as of a date after the date hereof,
the term "Disclosure Schedule" shall in such representations and warranties be
deemed to refer as well to all other matters and documents indicated by Borrower
in writing to be part of the Disclosure Schedule, which in the case of documents
Borrower has at the particular time in question delivered to Administrative
Agent and each Lender, and which have not been promptly objected to in writing
by or on behalf of Required Lenders.
"Documentation Agent" means Credit Suisse First Boston, as
Documentation Agent hereunder, and its successor in such capacity.
"EBITDAX" means, for any four Fiscal Quarter period ending on or after
March 31, 2000, the sum of the amounts for such period of Consolidated net
income (excluding gains or losses on the sale of assets), Consolidated Interest
Expense, depreciation expense, amortization expense, federal and state income
taxes, exploration and abandonment expense and other non-cash charges and
expenses, all as determined on a Consolidated basis for Borrower and its
Subsidiaries, with pro forma adjustments being made thereto for acquisitions and
dispositions of assets or Subsidiaries (including by way of merger) made during
such four Fiscal Quarter Period as if such acquisitions or dispositions had
occurred on the first day of such four Fiscal Quarter Period; provided, however,
that EBITDAX for the four Fiscal Quarter period ended March 31, 2000 shall be
deemed to be EBITDAX for the two Fiscal Quarter period ended March 31, 2000
times 2, and EBITDAX for the four Fiscal Quarter period ended June 30, 2000
shall be deemed to be EBITDAX for the three Fiscal Quarter period ended June 30,
2000 times 4/3.
5
"Effective Date" means the date the parties hereto shall have executed
and delivered counterparts hereof to Administrative Agent and the conditions
precedent to the initial Revolving Loan Advance shall have been satisfied (or
waived in accordance with Section 8.1). The Administrative Agent shall give the
parties hereto written notice of the occurrence of the Effective Date.
"Engineering Report" means a report prepared as of December 31 of each
year by Borrower for Securities and Exchange Commission reporting purposes and
subject to reasonable review by Agents showing the net present value (using an
8.75% discount rate and with prices adjusted to reflect a ten year future price
strip reasonably determined by Borrower and reasonably acceptable to Agents) of
the projected future net revenues attributable to the proved oil and gas
reserves included in the Properties of Borrower and its Restricted Subsidiaries.
"Environmental Law" means any federal, state, or local statute, or
rule or regulation promulgated thereunder, any judicial or administrative order
or judgment to which Borrower or any of its Subsidiaries is a party or which are
applicable to Borrower or any of its Subsidiaries or its or their respective
properties (whether or not by consent), and any provision or condition of any
permit, license or other governmental operating authorization, relating to
protection of the environment, persons or the public welfare from actual or
potential exposure or the effects of exposure to any actual or potential
release, discharge, spill or emission (whether past or present) of, or regarding
the manufacture, processing, production, gathering, transportation, importation,
use, treatment, storage or disposal of, any chemical, raw material, pollutant,
contaminant or toxic or hazardous substance or waste.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended from time to time, together with all rules and regulations promulgated
with respect thereto.
"ERISA Plan" means any pension benefit plan subject to Title IV of
ERISA maintained by any Designated Entity or any Affiliate thereof with respect
to which any Designated Entity has a fixed or contingent liability.
"Eurodollar Interest Period" means, with respect to each particular
Eurodollar Portion, a period of one (1), two (2), three (3) or six (6) months,
or, subject to Section 2.3, a period of nine (9) or twelve (12) months, as
specified in the Rate Election applicable thereto, beginning on and including
the date specified in such Rate Election (which must be a Business Day), and
ending on but not including the same day of the relevant month as the day on
which it began (e.g., a period beginning on the third day of one month shall end
on but not include the third day of another month), or if such month has no
numerically corresponding day, on the last Business Day of such month, and
provided that each Eurodollar Interest Period which would otherwise end on a day
which is not a Business Day shall end on the next succeeding Business Day
(unless such next succeeding Business Day is the first Business Day of a
calendar month, in which case such Eurodollar Interest Period shall end on the
immediately preceding Business Day). No Eurodollar Interest Period may be
elected for any Eurodollar Portion which would extend past the Maturity Date of
the Advance of which the Eurodollar Portion is a part.
"Eurodollar Margin" means, on any date, with respect to each
Eurodollar Portion of a Revolving Loan Advance, (a) prior to the day that is six
(6) months after the Effective Date, 162.5 basis points per annum, and (b) from
and after the day that is six (6) months after the Effective Date, the number of
basis points per annum set forth below based on the Applicable Rating Level then
in effect and the applicable Total Leverage Ratio as of the date of the last
calculation thereof:
6
Total Leverage Ratio
------------------------------------------
Applicable Rating Level <3.25 3.253.75
----------------------- - - -
Level I 100.0 100.0 125.0 125.0
Level II 125.0 137.5 162.5 187.5
Level III 150.0 162.5 187.5 200.0
Level IV 200.0 200.0 200.0 200.0
Changes in the Eurodollar Margin will occur automatically without prior notice
(x) upon the effectiveness of any change of the Applicable Rating Level and (y)
three (3) days following the earlier of (A) the date Borrower delivers the
certificate in respect of the previous Fiscal Quarter required pursuant to the
second sentence of Section 5.1(b)(1) (provided that for purposes of this
definition, Borrower shall be permitted to deliver a certificate sixty (60) days
following a Fiscal Year end containing the information to be included in the
certificate to be delivered pursuant to Section 5.1(b)(1) except based upon
unaudited Financial Statements for such Fiscal Year) or Section 5.1(b)(2), as
the case may be, and (B) sixty (60) days following the end of such previous
Fiscal Quarter, in the event of a change in the Total Leverage Ratio.
Administrative Agent will give notice promptly to Borrower and Lenders of each
change in the Eurodollar Margin.
"Eurodollar Portion" means the unpaid principal balance of a Revolving
Loan Advance which bears interest based on the Eurodollar Rate.
"Eurodollar Rate" means, with respect to each particular Eurodollar
Portion and with respect to the related Eurodollar Interest Period
(a) the rate per annum (carried out to the fifth decimal place) equal
to the rate determined by Administrative Agent to be the offered rate that
appears on the page of the Telerate Screen that displays an average British
Bankers Association Interest Settlement Rate (such page currently being page
number 3750) for deposits in dollars (for delivery on the first day of such
Eurodollar Interest Period) with a term equivalent to such Eurodollar Interest
Period, determined as of approximately 11:00 a.m. (London time) two Business
Days prior to the first day of such Eurodollar Interest Period, or
(b) in the event the rate referenced in the preceding subsection (a)
does not appear on such page or service or such page or service shall cease to
be available, the rate per annum (carried to the fifth decimal place) equal to
the rate determined by Administrative Agent to be the offered rate on such other
page or other service that displays an average British Bankers Association
Interest Settlement Rate for deposits in dollars (for delivery on the first day
of such Eurodollar Interest Period) with a term equivalent to such Eurodollar
Interest Period, determined as of approximately 11:00 a.m. (London time) two
Business Days prior to the first day of such Eurodollar Interest Period, or
(c) in the event the rates referenced in the preceding subsections (a)
and (b) are not available, the rate per annum determined by Administrative Agent
as the rate of interest at which dollar deposits (for delivery on the first day
of such Eurodollar Interest Period) in same day funds in the approximate amount
of the applicable Eurodollar Portion and with a term equivalent to such
Eurodollar Interest Period would be offered by Administrative Agent's London
Branch to major banks in the offshore dollar market at their request at
approximately 11:00 a.m. (London time) two Business Days prior to the first day
of such Eurodollar Interest Period.
"Eurodollars" is defined in Section 2.18.
7
"Event of Default" has the meaning given it in Section 6.1.
"Exchangeable Shares" means the capital stock of Pioneer Natural
Resources Canada Inc. that is exchangeable into common stock of Borrower
pursuant to a Voting and Exchange Trust Agreement between Borrower and The
Montreal Trust Company of Canada.
"Excluded Restricted Subsidiary" means, at the particular time in
question, a Foreign Restricted Subsidiary or any other Restricted Subsidiary
that is prohibited from, or causes Borrower or any Restricted Subsidiary to be
subject to adverse income tax consequences or substantial stamp or similar taxes
as a result of, guaranteeing the Obligations or pledging the capital stock of,
partnership interests in, or other ownership interests in, its Restricted
Subsidiaries to secure the Obligations (a) under Section 956 of the Code or
applicable stamp or similar tax laws, (b) by contractual restrictions in
existence prior to the Effective Date, in the case of a Person that is a
Restricted Subsidiary on the Effective Date, or by contractual restrictions in
existence prior to the date such Person becomes a Restricted Subsidiary, in the
case of a Person that becomes a Restricted Subsidiary after the Effective Date,
or (c) as a matter of corporate, partnership or limited liability company law.
"Executive Officer" means any individual duly elected to and holding
one or more of the following offices of Borrower: President, Chief Executive
Officer, Chief Financial Officer, Executive Vice President or Senior Vice
President.
"Existing Credit Agreement" means that certain Second Amended and
Restated Credit Agreement dated as of March 19, 1999, by and among Borrower, the
lenders parties thereto, Bank of America, N.A., as Administrative Agent and
Collateral Agent, and certain other Agents, as amended, modified or restated
prior to the Effective Date.
"Facility Amount" means the aggregate amount of the Commitments (which
amount shall initially be $575,000,000), as such amount may be reduced from time
to time pursuant to the terms of this Agreement.
"Federal Funds Rate" means, for any day, the rate per annum (rounded
upwards, if necessary, to the nearest 1/100 of 1%) 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 quoted to Administrative Agent
on such day on such transactions as determined by Administrative Agent.
"Fiscal Quarter" means a three-month period ending on March 31, June
30, September 30 or December 31 of each year.
"Fiscal Year" means a twelve-month period ending on December 31 of each
year.
"Foreign Restricted Subsidiary" means any Restricted Subsidiary of the
Borrower organized under the laws of any jurisdiction other than the United
States or any state thereof.
8
"GAAP" means those generally accepted accounting principles and
practices which are recognized as such by the Financial Accounting Standards
Board (or any generally recognized successor) and which, in the case of Borrower
and its Consolidated Subsidiaries, are applied for all periods after the date
hereof in a manner consistent with the manner in which such principles and
practices were applied to the Updated Financial Statements (except for changes
concurred with by Borrower's independent public accountants). If any change in
any accounting principle or practice is required by the Financial Accounting
Standards Board (or any such successor) in order for such principle or practice
to continue as a generally accepted accounting principle or practice, all
reports and financial statements required hereunder with respect to Borrower or
with respect to Borrower and its Consolidated Subsidiaries must be prepared in
accordance with such change. In the event any changes in GAAP materially affect
the calculation of Borrower's compliance with the covenants set forth in Section
5.3, Borrower and Lenders agree to enter into good faith negotiations for an
agreement to revise such covenants to take into account such changes in GAAP,
but until Borrower and Required Lenders have entered into such an agreement,
such financial calculation shall continue to be made in accordance with GAAP as
in effect immediately preceding the date of such change.
"Governmental Authority" means any national, state, county or municipal
government, domestic or foreign, any agency, board, bureau, commission, court,
department or other instrumentality of any such government, or any arbitrator in
any case which has jurisdiction over any Lender, Borrower or any of its
Subsidiaries or any properties of Borrower or any of its Subsidiaries.
"Guaranty" means a guaranty substantially in the form of Exhibit B,
with appropriate insertions and deletions, executed or to be executed by a
Restricted Subsidiary (other than an Excluded Restricted Subsidiary), as from
time to time amended, modified, or restated.
"Incumbent Directors" has the meaning given in Section 6.1(i).
"Issuing Bank" means each of Bank of America, N.A. and any other Lender
that in its sole discretion agrees to be and is designated by Borrower and
accepted by Administrative Agent to issue one or more Letters of Credit in its
capacity as an issuer of Letters of Credit hereunder, and their respective
successors in such capacity.
"LC Application" means any application for a Letter of Credit hereafter
made by Borrower to Issuing Bank.
"LC Conditions" has the meaning given it in Section 2.12.
"LC Obligations" means, at the particular time in question, the sum of
the Matured LC Obligations plus the aggregate amounts which Issuing Bank or any
Lender might be called upon to advance under all then outstanding Letters of
Credit.
"Letter of Credit" means (i) any letter of credit issued by Issuing
Bank upon the application of Borrower and (ii) each letter of credit listed on
Schedule 5 hereto and outstanding on the Effective Date, which letters of credit
will be deemed to be issued and outstanding under this Agreement as of the
Effective Date. Each Letter of Credit shall be classified by Issuing Bank as a
"Commercial" Letter of Credit or a "Standby" Letter of Credit, in accordance
with the laws and regulations applicable to Issuing Bank from time to time and
in accordance with Issuing Bank's customary practices at such times for
reporting to regulatory authorities.
9
"Lender" means each party hereto (other than Borrower) in its capacity
as a lender (including a swing line lender) hereunder.
"Lien" means, any lien, mortgage, security interest, pledge, deposit,
Production Payment, encumbrance, rights of a vendor under any title retention or
conditional sale agreement or lease or other arrangement substantially
equivalent thereto.
"Loan Documents" means this Credit Agreement, as the same may be
amended, modified or restated from time to time hereafter, any Notes, the LC
Applications, the Letters of Credit, the Swing Line Participation Certificates,
the Guaranties, the Pledge Agreements, the Disclosure Schedule, the agreements
with the Agents referred to in Section 2.8, any amendments, modifications or
restatements to any of the foregoing, and all other agreements, certificates,
notices and disclosures at any time executed or certified by a Designated
Officer of and on behalf of a Designated Entity and delivered by such Designated
Entity or such Designated Officer in connection herewith or therewith (exclusive
of term sheets, commitment letters, correspondence and similar documents used in
the negotiation hereof or thereof).
"Margin Regulations" means, as applicable, Regulations G, U and X of
the Board of Governors of the Federal Reserve System, as from time to time in
effect.
"Material Adverse Effect" shall mean a material adverse effect on (a)
the financial condition of Borrower and its Subsidiaries taken as a whole, (b)
the ability of Borrower and its Subsidiaries taken as a whole to operate their
respective businesses, (c) the ability of Borrower to meet its obligations under
the Loan Documents on a timely basis or (d) the ability of the Designated
Entities taken as a whole to meet their obligations under the Loan Documents on
a timely basis; provided, however, that a material adverse effect that is
limited to an Unrestricted Subsidiary shall not (i) be a Material Adverse Effect
or (ii) be included in the determination of whether a Material Adverse Effect
shall have occurred or shall be expected to occur.
"Matured LC Obligations" means all amounts paid by Issuing Bank or any
Lender on drafts or demands for payment drawn or made under any Letter of Credit
(or under or in connection with any LC Application) which have not been repaid
to Issuing Bank or such Lender (with the proceeds of a Revolving Loan Advance or
otherwise).
"Maturity Date" means the earlier of (a) March 1, 2005 and (b) the date
on which the Commitment of each Lender is reduced to zero or terminated.
"Maximum Lawful Rate" has the meaning given it in Section 8.6.
"Moody's" means ▇▇▇▇▇'▇ Investors Service, Inc. and any successor
thereto that is a nationally-recognized rating agency.
"Note" means any Revolving Loan Note or Swing Line Note.
"Notice Period" has the meaning given it in Section 6.4.
"Obligations" means all Debt from time to time owing by any of the
Designated Entities to any Agent or any Lender under or pursuant to any of the
Loan Documents, including, without limitation, all LC Obligations and Swing Line
Obligations. "Obligation" means any part of the Obligations.
10
"Percentage Share" means, with respect to any Lender (a) prior to the
Maturity Date (or after the Maturity Date if no Obligations are then
outstanding), the percentage set forth opposite such Lender's name on Schedule 1
to this Agreement, or in documents of assignment delivered pursuant to Section
8.8, as such percentage may be adjusted from time to time by such assignment
documents, and (b) on and after the Maturity Date if any Obligations are then
outstanding, the percentage equal to the unpaid principal balance of such
Lender's Revolving Loan Advances and participation in Swing Line Advances and LC
Obligations at the particular time in question divided by the aggregate unpaid
principal balance of all Revolving Loan Advances of all Lenders and
participations of all Lenders in Swing Line Advances and LC Obligations at such
time.
"Permitted Liens" means (a) Liens for taxes, assessments or other
governmental charges or levies if the same shall not at the particular time in
question be due and delinquent or (if foreclosure, distraint, sale or other
similar proceedings shall not have been commenced or, if commenced, shall have
been stayed) are being contested in good faith and by appropriate proceedings,
and if the Borrower shall have set aside on its books such reserves (segregated
to the extent required by sound accounting practices) as may be required by GAAP
or otherwise determined by the Board of Directors of Borrower to be adequate
with respect thereto; (b) Liens of carriers, warehousemen, mechanics, laborers,
materialmen, landlords, vendors, workmen, and operators arising in the ordinary
course of business or incident to the exploration, development, operations and
maintenance of oil, gas and other hydrocarbon properties and related facilities
and assets, for sums not yet due or being contested in good faith and by
appropriate proceedings, if Borrower shall have set aside on its books such
reserves (segregated to the extent required by sound accounting practices) as
may be required by GAAP or otherwise determined by the Board of Directors of
Borrower to be adequate with respect thereto; (c) Liens incurred in the ordinary
course of the Designated Entities' respective businesses in connection with
worker's compensation, unemployment insurance and other social security
legislation (other than ERISA); (d) Liens incurred in the ordinary course of
Designated Entities' businesses to secure the performance of bids, tenders,
trade contracts, leases (statutory only), statutory obligations, surety and
appeal bonds, performance and return-of-money bonds and other obligations of a
like nature; (e) Liens, easements, rights-of-way restrictions, servitudes,
permits, conditions, covenants, exceptions, reservations and other similar
encumbrances incurred in the ordinary course of Designated Entities' businesses
or existing on property and not in the aggregate materially interfering with the
ordinary conduct of the Designated Entities' businesses; (f) legal or equitable
encumbrances deemed to exist by reason of negative pledges such as in Section
5.2 of this Agreement or the existence of any litigation or other legal
proceeding and any related lis pendens filing (excluding any attachment prior to
judgment, judgment lien or attachment lien in aid of execution on a judgment);
(g) rights of a common owner of any interest in property held by any Designated
Entity as such common owner; (h) farmout, carried working interest, joint
operating, unitization, royalty, overriding royalty, sales and similar
agreements relating to the exploration or development of, or production from,
oil and gas properties incurred in the ordinary course of business, (i) Liens
arising pursuant to Section 9.319 of the Texas Uniform Commercial Code or other
similar statutory provisions of other states with respect to production
purchased from others; (j) Liens represented by capital leases permitted under
this Agreement; (k) any defects, irregularities, or deficiencies in title to
easements, rights-of-way or other properties which do not in the aggregate have
a Material Adverse Effect;(l) Liens existing in favor of Agents and Lenders
under the Loan Documents; (m) Liens on assets of a Subsidiary of Borrower in
favor of Borrower or another Restricted Subsidiary; (n) Liens on any property or
assets owned or leased by Borrower or any Subsidiary existing at the time such
property or asset was acquired (or at the time such Person became a Subsidiary);
provided that (1) in the case of the acquisition of a Subsidiary, such lien only
encumbers property or assets of such Subsidiary immediately prior to or at the
time of acquisition of such Subsidiary and (2) Borrower will use its best
efforts to eliminate such Liens in a timely manner; (o) purchase money Liens, so
11
long as such Liens only encumber property or assets (including any improvements
thereon, accessions thereto or proceeds thereof) acquired with the proceeds of
purchase money indebtedness incurred in connection with such Lien and permitted
hereunder; (p) Liens on the stock or other ownership interest of or in any
Unrestricted Subsidiary; (q) Liens in renewal or extension of any of the
foregoing permitted Liens, so long as limited to the property or assets
encumbered and the amount of indebtedness secured immediately prior to such
renewal or extension; (r) Liens approved in writing by or on behalf of the
Required Lenders; and (s) Liens on cash or cash equivalents pledged to secure
obligations in respect of exchange, forward, future, swap, hedging or similar
agreements.
"Person" means an individual, corporation, company, partnership,
association, joint stock company, trust or trustee thereof, estate or executor
thereof, unincorporated organization or joint venture, court or governmental
unit or any agency or subdivision thereof, or any other legally recognizable
entity.
"Pledge Agreement" means a Pledge Agreement substantially in the form
of Exhibit L hereto, or other form of pledge agreement in form and substance
satisfactory to Agents and the subject Designated Entity, pledging an interest
in the capital shares or stock of, partnership interests in, or other ownership
interests in, a Restricted Subsidiary, as from time to time amended, modified or
restated.
"Pledge Release Date" has the meaning given such term in Section 8.17.
"Production Payment" means a royalty, overriding royalty, net profits
interest, production payment (whether volumetric or dollar denominated) or other
similar interest in oil and gas Properties, reserves or the right to receive all
or a portion of the production or the proceeds from the sale of production
attributable to such oil and gas Properties, if and to the extent accounted for
as indebtedness or deferred revenue on the balance sheet of Borrower or any of
its Restricted Subsidiaries under GAAP at the time of the grant or transfer
thereof.
"Properties" means, at the particular time in question, all oil and gas
properties, interests and reserves and facilities and related assets (which
properties, interests and reserves and facilities and related assets shall be
free of any Liens other than Permitted Liens) of the Borrower and its Restricted
Subsidiaries at such time.
"Properties NPV" means, at the particular time in question, the net
present value (determined in accordance with the definition of Engineering
Report) of the projected future net revenues attributable to the proved oil and
gas reserves included in the Properties, as set forth in the Engineering Report
most recently provided by Borrower pursuant to Section 5.1(b)(3).
"Rate Election" has the meaning given it in Section 2.3.
"Regulation D" means Regulation D of the Board of Governors of the
Federal Reserve System, as from time to time in effect.
"Request for Revolving Loan Advance" means a written or telephonic
request, or a written confirmation, made by Borrower which meets the
requirements of Section 2.2.
"Request for Swing Line Advance" has the meaning given it in Section
2.5(a).
"Required Lenders" means Lenders whose aggregate Percentage Shares
exceed 50%.
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"Reserve Percentage" means, on any day with respect to each particular
Eurodollar Portion, the maximum reserve requirement, as determined by
Administrative Agent (including without limitation any basic, supplemental,
marginal, emergency or similar reserves), expressed as a percentage and rounded
to the nearest 1/100th of 1%, which would then apply to Bank of America, N.A.
under Regulation D or successor regulations issued from time to time by the
Board of Governors of the Federal Reserve System with respect to "Eurocurrency
liabilities" (as such term is defined in Regulation D) equal in amount to Bank
of America, N.A.'s part of such Eurodollar Portion, were Bank of America, N.A.
to have any such Eurocurrency liabilities. If such reserve requirement shall
change after the date hereof, the Reserve Percentage shall be automatically
increased or decreased, as the case may be, from time to time as of the
effective time of each such change in such reserve requirement.
"Restricted Payment" means with respect to any Person (i) any dividend
or distribution (other than dividends or distributions payable in capital stock
or to Borrower or any Restricted Subsidiary) on, or purchase, redemption or
other acquisition for value of, any capital stock of such Person, or (ii) any
investment, contribution, loan or advance of cash to a Person (other than
Borrower or a Restricted Subsidiary) other than:
(a) prudent short-term investments;
(b) investments, contributions, loans or advances disclosed in the
Updated Financial Statements or in the Disclosure Schedule or
in disclosures made subsequent to the date hereof and
consented to in writing by or on behalf of the Required
Lenders;
(c) investments, contributions, loans or advances made by any
Designated Entity in the ordinary course of its business; or
(d) contributions made by Borrower to any of its Subsidiaries
arising out of or in respect of Letters of Credit issued
hereunder and used for the general corporate purposes of such
Subsidiary (i) so long as no amounts have been drawn under any
such Letter of Credit or (ii) to the extent that Borrower has
been reimbursed by such Subsidiary for amounts drawn under any
such Letter of Credit.
"Restricted Subsidiary" means each Subsidiary of Borrower that, at the
particular time in question, (i) owns directly or indirectly any material assets
or any interest in any other Restricted Subsidiary and (ii) either (a) has not
been designated as an Unrestricted Subsidiary or (b) has been redesignated as a
Restricted Subsidiary. The Restricted Subsidiaries on the date hereof are listed
on Schedule 3 attached hereto and each other Subsidiary of Borrower as of the
date hereof shall be an Unrestricted Subsidiary. A Restricted Subsidiary shall
remain such (even if it no longer owns directly or indirectly any interest in
any of the material assets) until designated as an Unrestricted Subsidiary
pursuant to Section 5.2(i). An Unrestricted Subsidiary shall remain an
Unrestricted Subsidiary unless redesignated as a Restricted Subsidiary pursuant
to the provisions of Section 5.2(i).
"Revolving Loan Advance" has the meaning given it in Section 2.1(a).
"Revolving Loan Note" has the meaning given it in Section 2.1(c).
13
"S&P" means Standard & Poor's Ratings Group and any successor thereto
that is a nationally- recognized rating agency.
"Subsidiary" means, with respect to any Person, any corporation, which
is directly or indirectly (through one or more intermediaries) controlled by or
with respect to which fifty percent (50%) or more of the stock or other equity
interests having ordinary voting power to elect the board of directors or other
governing body is owned by such Person, or any association, partnership, joint
venture, or other non- corporate business entity, enterprise or organization
that is directly or indirectly (through one or more intermediaries) controlled
by, or owned one hundred percent (100%) by, such Person, provided that
associations, joint ventures or other relationships (a) which are established
pursuant to an operating agreement or similar agreement or which are
partnerships for purposes of federal income taxation only, (b) which are not
partnerships (or subject to the Uniform Partnership Act) under applicable state
law, and (c) whose businesses are limited to the exploration, development and
operation of oil, gas or mineral properties and interests owned directly by the
parties in such associations, joint ventures or relationships, shall not be
deemed to be "Subsidiaries" of such Person.
"Swing Line Advances" has the meaning given it in Section 2.4.
"Swing Line Lender" means Bank of America, N.A., in its capacity as
swing line lender hereunder, and its successor in such capacity.
"Swing Line Note" has the meaning given it in Section 2.5(e).
"Swing Line Obligations" means, at the particular time in question, the
sum of all outstanding Swing Line Advances.
"Swing Line Participation Certificate" means a Swing Line Participation
Certificate substantially in the form of Exhibit F.
"Swing Line Rate" has the meaning given it in Section 2.5(a).
"Syndication Agent" means The Chase Manhattan Bank, as Syndication
Agent hereunder, and its successor in such capacity.
"Taxes" has the meaning given it in Section 2.20.
"Termination Event" means (a) the occurrence with respect to any ERISA
Plan of (1) a reportable event described in Sections 4043(b)(5) or (6) of ERISA
or (2) any other reportable event described in Section 4043(b) of ERISA other
than a reportable event not subject to the provision for 30-day notice to the
Pension Benefit Guaranty Corporation pursuant to a waiver by such corporation
under Section 4043(a) of ERISA, or (b) the withdrawal of any Designated Entity
or of any Affiliate of any Designated Entity from an ERISA Plan during a plan
year in which it was a "substantial employer" as defined in Section 4001(a)(2)
of ERISA, or (c) the filing of a notice of intent to terminate any ERISA Plan or
the treatment of any ERISA Plan amendment as a termination under Section 4041 of
ERISA, or (d) the institution of proceedings to terminate any ERISA Plan by the
Pension Benefit Guaranty Corporation under Section 4042 of ERISA, or (e) any
other event or condition which might constitute grounds under Section 4042 of
ERISA for the termination of, or the appointment of a trustee to administer, any
ERISA Plan.
14
"Total Funded Debt" means all Debt of the type referred to in clauses
(a), (b), (c), (d), (g) (excluding Debt of the type referred to in clause (e) of
the definition of "Debt") and (h) of the definition of "Debt".
"Total Leverage Ratio" means, at any time, the ratio of (a) Borrower's
Consolidated Total Funded Debt to (b) Borrower's EBITDAX for the four Fiscal
Quarter period then ended.
"Unrestricted Subsidiary" means each Subsidiary of Borrower which is
not designated as a Restricted Subsidiary on Schedule 3 attached hereto or is
designated by Borrower as an Unrestricted Subsidiary pursuant to Section 5.2(i).
"Updated Financial Statements" means the audited annual Consolidated
financial statements of Borrower and its Consolidated Subsidiaries dated as of
December 31, 1999.
Section 1.2 Exhibits and Schedules. All Exhibits and Schedules
attached to this Agreement are a part hereof for all purposes.
Section 1.3 Amendment of Defined Instruments. Unless the context
otherwise requires or unless otherwise provided herein, the terms defined in
this Agreement which refer to a particular agreement, instrument or document
also refer to and include all renewals, extensions, modifications, amendments
and restatements of such agreement, instrument or document, provided that
nothing contained in this section shall be construed to authorize or require any
such renewal, extension, modification, amendment or restatement.
Section 1.4 References and Titles. All references in this Agreement to
Exhibits, Schedules, articles, sections, subsections and other subdivisions
refer to the Exhibits, Schedules, articles, sections, subsections and other
subdivisions of this Agreement unless expressly provided otherwise. Titles
appearing at the beginning of any subdivisions are for convenience only and do
not constitute any part of such subdivisions and shall be disregarded in
construing the language contained in such subdivisions. The words "this
Agreement", "this instrument", "herein", "hereof", "hereby", "hereunder" and
words of similar import refer to this Agreement as a whole and not to any
particular subdivision unless expressly so limited. The phrases "this section"
and "this subsection" and similar phrases refer only to the sections or
subsections hereof in which such phrases occur. The word "or" is not exclusive,
and the word "including" (in its various forms) means "including without
limitation". Pronouns in masculine, feminine and neuter genders shall be
construed to include any other gender, and words in the singular form shall be
construed to include the plural and vice versa, unless the context otherwise
requires.
Section 1.5 Calculations and Determinations. All calculations under the
Loan Documents of interest and fees made under the Loan Documents shall be made
on the basis of actual days elapsed (including the first day but excluding the
last) and a year of 360 days; provided, however, that all calculations of
interest based on the "Prime Rate" shall be made on the basis of actual days
elapsed (including the first day but excluding the last) and a year of 365 or
366 days, as appropriate; and provided, further, however that, all calculations
of interest shall be subject to the limitations set forth in Section 8.6 hereof.
Unless otherwise expressly provided herein or unless Required Lenders otherwise
consent, all financial statements and reports furnished to Administrative Agent
or any Lender hereunder shall be prepared and all financial computations and
determinations pursuant hereto shall be made in accordance with GAAP.
15
ARTICLE 2
ADVANCES AND LETTERS OF CREDIT
Section 2.1 Making and Repaying the Revolving Loan Advances.
(a) Subject to the terms and conditions hereof, each Lender severally
agrees to make advances on a revolving basis (each a "Revolving
Loan Advance") to Borrower from time to time on any Business Day
during the Commitment Period, equal to such Lender's Percentage
Share of the aggregate amount of Revolving Loan Advances
requested by Borrower to be made on such day, so long as the
aggregate amount of (i) all Lenders' Revolving Loan Advances
(including any Revolving Loan Advances to be made but not yet
made pursuant to a Request for Revolving Loan Advance)
outstanding at any time plus (ii) the LC Obligations of all
Lenders at such time plus (iii) all Swing Line Obligations
outstanding at such time do not exceed the Facility Amount.
Subject to the terms and conditions hereof, Borrower may borrow,
repay and reborrow Revolving Loan Advances.
(b) No Lender shall be permitted or required to make any Revolving
Loan Advance under this Agreement unless the aggregate of (1)
such Lender's Revolving Loan Advances under this Agreement
(including any Revolving Loan Advances to be made but not yet
made pursuant to a Request for Revolving Loan Advance)
outstanding at any time plus (2) such Lender's share of LC
Obligations at such time plus (3) such Lender's participation
pursuant to a Swing Line Participation Certificate in any Swing
Line Advance outstanding at such time is less than or equal to
the least of (i) such Lender's Commitment or (ii) such Lender's
Percentage Share of the Facility Amount.
(c) The aggregate amount of all Revolving Loan Advances requested of
all Lenders in any Request for Revolving Loan Advance must be an
integral multiple of $1,000,00 which equals or exceeds
$10,000,000 or must equal the least of the unadvanced portion of
the aggregate Commitments of all Lenders or the unadvanced
portion of the Facility Amount. The obligation of Borrower to
repay to each Lender the aggregate amount of all Revolving Loan
Advances made by such Lender to Borrower, together with interest
accruing thereon, shall be evidenced by one or more loan accounts
or records maintained by such Lender in the ordinary course of
business. Upon the request of any Lender made through
Administrative Agent, such Lender's Revolving Loan Advances may
be evidenced by a promissory note (a "Revolving Loan Note") made
by Borrower payable to the order of such Lender in the amount of
its Commitment, substantially in the form of Exhibit A-1 with
appropriate insertions. Each such Lender may attach schedules to
its Revolving Loan Note and endorse thereon the date and amount
of, and interest rate applicable to, each Revolving Loan Advance
and each payment thereon. Such loan accounts, records and
Revolving Loan Note shall be presumptive evidence of the amount
of Revolving Loan Advances made by such Lender and payments
thereon. Any failure so to record or any error in doing so shall
not, however, limit or otherwise affect the obligation of
Borrower to pay any amount owing with respect to the Obligations.
(d) Borrower promises to pay to each Lender, on the Maturity Date,
the balance of all Revolving Loans made by such Lender.
Borrower promises to pay to each Lender interest (a) on each
Base Rate Portion, at the Base Rate plus the Base Rate Margin,
payable on the third Business
16
Day of each Fiscal Quarter and on the Maturity Date, and (b) on
each Eurodollar Portion, at the Adjusted Eurodollar Rate, payable
on the last day of each applicable Eurodollar Interest Period
(and if such Eurodollar Interest Period shall exceed three
months, every three months during such Eurodollar Interest
Period) and on the Maturity Date. Past due principal and interest
(to the extent allowed by law) shall bear interest at the lesser
of the Default Rate or the Maximum Lawful Rate and shall be
payable on demand.
Section 2.2 Requests for Revolving Loan Advances. Borrower must give to
Administrative Agent not later than 11:00 a.m., Dallas, Texas time, for same day
funding, and not later than 1:00 p.m., Dallas, Texas time, for next Business Day
funding, written notice, or telephonic notice promptly confirmed in writing, of
any requested Revolving Loan Advances, after which Administrative Agent shall
give each Lender prompt notice thereof. Each such written request or
confirmation must be made in the form and substance of Exhibit C attached
hereto, duly completed (herein called a "Request for Revolving Loan Advance").
Each such telephonic request shall be deemed a representation, warranty,
acknowledgment and agreement by Borrower as to the matters which are required to
be set out in such Request for Revolving Loan Advance. If all conditions
precedent to a Revolving Loan Advance have been met, each Lender will on the
date requested remit, not later than 1:00 p.m., Dallas, Texas time, for same day
funding, and not later than 1:00 p.m., Dallas, Texas time, the following
Business Day for next Business Day funding, to Administrative Agent at
Administrative Agent's office in Dallas, Texas, or to such other office as
Administrative Agent may specify from time to time by notice to Lenders, the
amount of such Lender's Revolving Loan Advance in immediately available funds,
and upon receipt of such funds, unless to its actual knowledge any conditions
precedent to such Revolving Loan Advances have been neither met nor waived as
provided herein, Administrative Agent shall promptly make the Revolving Loan
Advances available to Borrower. Each Request for Revolving Loan Advance shall be
irrevocable and binding on Borrower. Unless Administrative Agent shall have
received prompt notice from a Lender that such Lender will not make available to
Administrative Agent such Lender's Revolving Loan Advance, Administrative Agent
may in its discretion assume that such Lender has made such Revolving Loan
Advance available to Administrative Agent in accordance with this section and
Administrative Agent may if it chooses, in reliance upon such assumption, make
such Revolving Loan Advance available to Borrower. If and to the extent such
Lender shall not so make its Revolving Loan Advance available to Administrative
Agent, such Lender and Borrower severally agree to pay or repay to
Administrative Agent on demand the amount of such Revolving Loan Advance
together with interest thereon, for each day from the date such amount is made
available to Borrower until the date such amount is paid or repaid to
Administrative Agent, (i) if paid or repaid by Borrower at the interest rate
applicable at the time to the other Revolving Loan Advances made on such date of
such Revolving Loan Advance and (ii) if paid or repaid by such Lender, at the
Federal Funds Rate. The failure of any Lender to make any Revolving Loan Advance
to be made by it hereunder shall not relieve any other Lender of its obligation
hereunder, if any, to make its Revolving Loan Advance, but no Lender shall be
responsible for the failure of any other Lender to make any Revolving Loan
Advance to be made by such other Lender.
Section 2.3 Rate Elections. Borrower may from time to time designate
all or any portions of the Revolving Loan Advances (including any yet to be made
Revolving Loan Advances which are to be made prior to or at the beginning of the
designated Eurodollar Interest Period but excluding any portions of the
Revolving Loan Advances which are required to be repaid prior to the end of the
designated Eurodollar Interest Period and excluding any Swing Line Advance) as a
Eurodollar Portion with each Lender participating in such Eurodollar Portion in
accordance with its Percentage Share. Without the consent of Required Lenders,
Borrower may not make such election, and Administrative Agent and Lenders shall
not be required to give effect to such election, during the continuance of a
Default and Borrower may make such
17
an election with respect to already existing Eurodollar Portions only if such
election will take effect at or after the termination of the Eurodollar Interest
Period applicable thereto. Each election by Borrower of a Eurodollar Portion
shall:
(a) Be made in writing in the form and substance of Exhibit D
attached hereto, duly completed, herein called a "Rate
Election";
(b) Specify the aggregate amount of the Revolving Loan Advances
which Borrower desires to designate as such Eurodollar
Portion, the first day of the Eurodollar Interest Period which
is to apply thereto, and the length of such Eurodollar
Interest Period; and
(c) Be received by Administrative Agent not later than 10:00 a.m.,
Dallas, Texas time, on the third Business Day preceding the
first day of the specified Eurodollar Interest Period.
Promptly after receiving any such Rate Election which meets the
requirements of this section, Administrative Agent shall notify each Lender
thereof. Each Rate Election shall be irrevocable. Borrower may not make any Rate
Election which does not specify an Eurodollar Interest Period complying with the
definition of "Eurodollar Interest Period" in Section 1.1, and the aggregate
amount of the Eurodollar Portion elected in any Rate Election must be
$10,000,000 or a higher integral multiple of $1,000,000. Upon the termination of
each Eurodollar Interest Period, the Eurodollar Portion subject thereto shall,
unless the subject of a new Rate Election then taking effect, automatically
become a Base Rate Portion and become subject to all provisions of the Loan
Documents governing such Base Rate Portion. Borrower shall have no more than
fifteen (15) Eurodollar Portions in effect at any time.
If requested to do so by Borrower through Administrative Agent at least
two (2) Business Days before the delivery date of any proposed Rate Election,
each Lender will advise Administrative Agent before 10:00 a.m., Dallas, Texas
time, on the Business Day following receipt of such request as to whether, if
Borrower selects a specified duration of nine (9) or twelve (12) months for the
Eurodollar Interest Period applicable to such proposed Rate Election, such
Lender expects that deposits in dollars with a corresponding term will be
available to it in the relevant market on the first day of such Eurodollar
Interest Period in the amount required to fund the Eurodollar Portion to which
such Eurodollar Interest Period would apply. Unless each Lender responds by such
time to the effect that it expects such deposits will be available to it,
Borrower shall not be entitled to select such proposed duration for such
Eurodollar Interest Period.
Each Lender may, if it so elects, fulfill its obligation to fund any
Eurodollar Portion by causing one of its foreign branches or Affiliates (or an
international banking facility created by such Lender) to fund or continue such
Eurodollar Portion; provided, however, that such Eurodollar Portion shall be
deemed to have been made and held by such Lender, and the obligations of
Borrower to repay such Eurodollar Portion shall nevertheless be to such Lender
for the account of such branch or Affiliate (or international banking facility).
In addition, Borrower hereby consents and agrees that, for purposes of any
determination to be made for purposes of Sections 2.17, 2.18, 2.19 and 2.20, it
shall be conclusively assumed that such Lender elected to fund all Eurodollar
Portions by purchasing Dollar deposits in the interbank eurodollar market of its
designated office.
Section 2.4 Swing Line Advances. In addition to borrowings pursuant to
Section 2.1(a), Borrower may request Swing Line Lender to make advances to
Borrower on any Business Day (unless Borrower and Swing Line Lender agree
otherwise) during the Commitment Period as provided in Sections 2.5 and 2.6
(herein called "Swing Line Advances"); provided, however, that (a) each Swing
Line Advance
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shall be in an amount not less than $1,000,000, (b) at no time shall the
outstanding aggregate principal amount of all Swing Line Advances exceed
$50,000,000, and (c) at no time shall the sum of (1) the outstanding aggregate
principal amount of all Swing Line Advances, (2) the outstanding aggregate
principal amount of the Revolving Loans, and (3) the outstanding aggregate
principal amount of LC Obligations exceed the Facility Amount.
Section 2.5 Procedure for Swing Line Advances.
(a) No later than 11:00 a.m., Dallas, Texas time, on a Business Day
on which Borrower desires a Swing Line Advance, Borrower shall
transmit to Swing Line Lender and to Administrative Agent by
telecopy a notice in substantially the form of Exhibit E attached
hereto (herein called a "Request for Swing Line Advance"). Swing
Line Lender will specify the rate of interest per annum which
will be the fixed rate of interest to be charged for such Swing
Line Advance until maturity (herein called the "Swing Line
Rate").
(b) Swing Line Lender shall wire the Swing Line Advance to
Administrative Agent in immediately available funds by no later
than 1:00 p.m., Dallas, Texas time on the date of request for
such Swing Line Advance, and Administrative Agent shall deposit
such funds to an account designated by Borrower by no later than
1:15 p.m. on the same day.
(c) Borrower promises to pay each Swing Line Advance at or before
1:00 p.m., Dallas, Texas time, on the first Business Day after it
is made or at such other maturity (such date of maturity being no
more than fourteen (14) days after the date of the Swing Line
Advance and no later than the Maturity Date) as is agreed to by
Borrower, Administrative Agent and Swing Line Lender. The
repayment shall be paid on such date by Borrower (which payment
may be in the form of a Swing Line Advance advanced to Borrower
on that day) to Administrative Agent in immediately available
funds with instructions to Administrative Agent to forward such
proceeds to Swing Line Lender. Borrower promises to pay interest
on each Swing Line Advance at the Swing Line Rate. Such interest
shall be paid by Borrower (which payment may be in the form of a
Swing Line Advance advanced to Borrower on that day) to
Administrative Agent in immediately available funds on the first
Business Day of each calendar month with instructions to
Administrative Agent to forward such proceeds to Swing Line
Lender.
(d) Interest on the Swing Line Advances shall be computed on the
basis of a year of 360 days and actual days elapsed (including
the first day, but excluding the last day) occurring in the
period for which payable and shall not exceed Maximum Lawful
Rate. Past due principal and interest (to the extent allowed by
law) shall bear interest at the lesser of the Default Rate or the
Maximum Lawful Rate and shall be payable on demand.
(e) The Swing Line Advances made by Swing Line Lender shall be
evidenced by one or more loan accounts or records maintained by
Swing Line Lender in the ordinary course of business. Upon the
request of Swing Line Lender made through Administrative Agent,
Swing Line Advances may be evidenced by a promissory note (the
"Swing Line Note") made by Borrower payable to the order of Swing
Line Lender in the amount of $50,000,000 and in substantially the
form of Exhibit A-2 attached hereto, with appropriate insertions.
The date, amount, Swing Line Rate and maturity of each Swing Line
Advance made by Swing Line Lender to Borrower, and each payment
made on account thereof, may be recorded by Swing Line Lender on
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its books and/or on the Swing Line Note (or a schedule thereto).
Such books and Swing Line Note shall be presumptive evidence of
the amount of the Swing Line Advances, the Swing Line Rate
applicable thereto and payments thereon. Any failure of Swing
Line Lender so to record or any error in doing so shall not,
however, limit or otherwise affect the obligation of Borrower to
pay any amount owing with respect to the Obligations.
(f) The Swing Line Advances will be used by Borrower to provide
working capital for the operations of Borrower and its
Subsidiaries and for general business purposes. No Swing Line
Advances shall be used for the purpose of purchasing or carrying
any Margin Stock in violation of the Margin Regulations.
(g) The obligation of Swing Line Lender to make each Swing Line
Advance is further subject to the conditions contained in Article
3.
Section 2.6 Special Provisions for Swing Line Advances.
(a) Lenders to Make Revolving Loan Advances.
(i) Swing Line Lender, at any time in its discretion, upon
written request to Lenders through Administrative Agent (with a copy to
Borrower), may require each Lender (including the Swing Line Lender) to
make a Revolving Loan Advance, subject to the provisions of Section 2.1
hereof (other than the satisfaction of the conditions precedent set
forth in Article III), in an amount equal to such Lender's Percentage
Share of the outstanding Swing Line Advances. Swing Line Lender shall
deliver such request to Administrative Agent prior to 11:00 a.m.,
Dallas, Texas time, on the Business Day next preceding the date (which
shall be a Business Day) on which such Revolving Loan Advances are to
be made. Promptly upon receipt of any such request, Administrative
Agent shall give notice thereof to Lenders. Each Lender shall make
available its Percentage Share of such Revolving Loan Advances to
Administrative Agent by 11:00 a.m., Dallas, Texas time, on the
requested date for such Revolving Loan Advances. Administrative Agent
shall apply the proceeds of such Revolving Loan Advances to prepay the
Swing Line Advances of Swing Line Lender; provided, however, that
Administrative Agent shall be obligated to make the proceeds of such
Revolving Loan Advances available only to the extent received by it
from Lenders. All Revolving Loan Advances made pursuant to this
subsection shall initially be Base Rate Portions.
(ii) In the event Administrative Agent advances proceeds of
any Revolving Loan Advance to Swing Line Lender and one or more of the
Lenders (other than Swing Line Lender) fail to fund all or any portion
of such Revolving Loan Advance as provided herein, then (I) such Lender
shall pay directly to Administrative Agent the amount thereof together
with interest thereon at the Federal Funds Rate, and (II) if not paid
by such Lender, the Swing Line Lender will repay directly to
Administrative Agent such amount as will equal the amount such other
Lender(s) failed to fund, together with interest at the Federal Funds
Rate.
(b) Participations in Swing Line Advances.
(i) If, at any time prior to the making of Revolving Loan
Advances pursuant to subsection 2.6(a) hereof, any Event of Default
described in Sections 6.1(h) hereof shall have occurred, each Lender,
on the date such Revolving Loan Advances were to have been made or, if
20
no request for Revolving Loan Advances had been made pursuant to
Section 2.6(a)(i) hereof, promptly upon request by Swing Line Lender
delivered to Administrative Agent, shall purchase an undivided
participation interest in all outstanding Swing Line Advances in an
amount equal to its Percentage Share times the outstanding amount of
such Swing Line Advances. Each Lender (other than Swing Line Lender)
will transfer immediately to Administrative Agent for credit to Swing
Line Lender, in immediately available funds, the amount of its
participation. Upon receipt thereof, Swing Line Lender will deliver to
such other Lender a Swing Line Advance Participation Certificate, dated
the date of receipt of such funds and in the amount of such Lender's
participation.
(ii) Whenever, at any time after Swing Line Lender has
received from any other Lender such other Lender's participating
interest in a Swing Line Advance, Swing Line Lender receives any
payment on account thereof, Administrative Agent will distribute to
such other Lender its participating interest in such amount
(appropriately adjusted, in the case of interest payments, to reflect
the period of time during which such Lender's participating interest
was outstanding and funded); provided, however, that in the event that
any payment received by Swing Line Lender is required to be returned,
such other Lender will return to Swing Line Lender any portion thereof
previously distributed to it.
(c) Acknowledged Privity. Borrower expressly agrees that, in respect of
each Lender's funded participation interest in any Swing Line Advance, such
Lender shall be deemed to be in privity of contract with Borrower and have the
same rights and remedies against Borrower under the Loan Documents as if such
funded participation interest in such Swing Line Advance were a Revolving Loan
Advance.
(d) Unconditional Obligation. Each Lender's obligation to make
Revolving Loan Advances or to purchase participation interests in Swing Line
Advances as provided in this section shall be absolute and unconditional and
shall not be affected by any circumstance, including, without limitation, (A)
any set-off, counterclaim, recoupment, defense or other right which such Lender
may have against Swing Line Lender, Borrower or any other Person for any reason
whatsoever, (B) the existence of any Default or Event of Default at any time,
(C) the occurrence of any event or existence of any condition that might have a
Material Adverse Effect, or (D) any other circumstance, happening or event
whatsoever, whether or not similar to any of the foregoing.
Section 2.7 Commitment Fee. In consideration of each Lender's
commitment to make Revolving Loan Advances, Borrower will pay to Administrative
Agent for the account of each Lender based on its Percentage Share a commitment
fee equal to the Commitment Fee Rate times the daily average unused amount of
the Facility Amount, payable in arrears quarterly until the Maturity Date, with
the first payment thereof to be July 1, 2000, subsequent payments on the first
day following each successive calendar quarter ending on each March, June,
September and December, and the final payment thereof on the Maturity Date. For
purposes of this section, outstanding Swing Line Advances shall not be deemed to
be usage of the Facility Amount.
Section 2.8 Agents' and Administrative Agent's Fees. In addition to all
other amounts due to Agents under the Loan Documents, Borrower will pay the
non-refundable fees set forth in those certain separate Fee Letters dated March
22, 2000, between Borrower and each Agent.
Section 2.9 Termination and Reduction of Commitments.
(a) Unless previously terminated, the Commitments shall terminate on
the Maturity Date.
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(b) Borrower may at any time terminate, or from time to time reduce,
the Commitments; provided that (i) each reduction of the Commitments shall be in
an amount that is an integral multiple of $1,000,000 and not less than
$5,000,000 and (ii) Borrower shall not terminate or reduce the Commitments if,
after giving effect to any concurrent prepayment of the Advances in accordance
with Section 2.10, the sum of (i) all Lenders' Revolving Loan Advances
(including any Revolving Loan Advances to be made but not yet made pursuant to a
Request for Revolving Loan Advance) outstanding at such time plus (ii) the LC
Obligations of all Lenders outstanding at such time plus (iii) all Swing Line
Advances outstanding at such time would exceed the total Commitments.
(c) Borrower shall notify the Administrative Agent of any election to
terminate or reduce the Commitments under paragraph (b) of this section at least
two 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, the Administrative Agent shall advise the Lenders of the
contents thereof. Each notice delivered by Borrower pursuant to this section
shall be irrevocable; provided that a notice of termination of the Commitments
delivered by Borrower may state that such notice is conditioned upon the
effectiveness of other credit facilities, in which case such notice may be
revoked by Borrower (by notice to the Administrative Agent on or prior to the
specified effective date) if such condition is not satisfied. Any termination or
reduction of the Commitments shall be permanent. Each reduction of the
Commitments shall be made ratably among the Lenders in accordance with their
respective Commitments.
Section 2.10 Optional Prepayments. Borrower may, upon notice to each
Lender identical to that required for related borrowings under this Agreement,
from time to time and without premium or penalty, prepay Advances (ratably if
such prepayment is of Revolving Loan Advances), in whole or in part, so long as
the aggregate amounts of all partial prepayments of principal concurrently paid
equals $5,000,000 or any higher integral multiple of $1,000,000 or the aggregate
outstanding balance of the Advances, and so long as Borrower does not prepay any
Revolving Loan Advance or Swing Line Advance except in accordance herewith. Any
amounts prepaid pursuant to this section shall be in addition to, and not in
lieu of, all payments otherwise required to be paid under the Loan Documents at
the time of such prepayment.
Section 2.11 Payments to Lenders. Except as expressly set forth in
Section 2.5(c) with respect to repayment of Swing Line Advances, Borrower will
make each payment which it owes under the Loan Documents to Administrative Agent
at its principal banking office in Dallas, Texas, or to such other office as
Administrative Agent may specify from time to time by notice to Borrower for the
account of each Lender to whom such payment is owed, without the application of
any setoff, deduction or counterclaim. Each such payment must be received by
Administrative Agent not later than 1:00 p.m., Dallas, Texas time, on the date
such payment becomes due and payable, in lawful money of the United States of
America and in immediately available funds. Any payment received by
Administrative Agent after such time will be deemed to have been made on the
next Business Day. Should any such payment become due and payable on a day other
than a Business Day, the maturity of such payment shall be extended to the next
succeeding Business Day (except, with respect to any Eurodollar Portion, as may
be otherwise required by the definition of Eurodollar Interest Period), and, in
the case of a payment of principal or past due interest, interest shall accrue
and be payable thereon for the period of such extension as provided in the Loan
Document under which such payment is due.
All payments applied to principal or interest shall be applied first to
any interest then due and payable, then to principal then due and payable, and
last to any prepayment of principal and interest in compliance with Section
2.10. Unless otherwise expressly provided, all payments by any Designated Entity
pursuant to this Agreement or any other Loan Document shall be made by such
22
Designated Entity to Administrative Agent for the account of Agents and Lenders
pro rata among Obligations of the same type and, if applicable, having the same
Eurodollar Interest Period or, in the case of Swing Line Advances, the same
maturity date.
Section 2.12 Letters of Credit. Subject to the terms and conditions
hereof, Borrower may request Issuing Bank to issue one or more Letters of
Credit, provided that, after taking such Letter of Credit into account:
(a) the sum of (1) the aggregate principal amount of Revolving
Loan Advances outstanding at such time, (2) the aggregate
principal amount of LC Obligations outstanding at such time
and (3) the aggregate principal amount of Swing Line Advances
outstanding at such time does not exceed the least of (i) the
aggregate of all Lenders' Commitments at such time or (ii) the
Facility Amount;
(b) the aggregate amount of LC Obligations outstanding at such
time does not exceed $75,000,000;
(c) the expiration date of such Letter of Credit is prior to the
Maturity Date, unless otherwise agreed to by all Lenders and
Issuing Bank;
(d) such Letter of Credit is to be used for general corporate
purposes of Borrower or any of its Subsidiaries, subject to
paragraph (e) of this section;
(e) the terms of such Letter of Credit are acceptable to Issuing
Bank in the reasonable exercise of its discretion; and
(f) all other conditions in this Agreement to the issuance of such
Letter of Credit have been satisfied.
Issuing Bank will honor any such request if the foregoing conditions (a) through
(f) (herein called the "LC Conditions") have been met as of the date of issuance
of such Letter of Credit.
Section 2.13 Requesting Letters of Credit. Borrower must make written
application pursuant to an LC Application for any Letter of Credit at least
three (3) Business Days before the date on which Issuing Bank is requested to
issue such Letter of Credit. By making any such written application Borrower
shall be deemed to have represented and warranted that the LC Conditions will be
met as of the date of issuance of such Letter of Credit. Each such LC
Application must be made in such form as may mutually be agreed upon by Issuing
Bank and Borrower. No more than two (2) Business Days after the LC Conditions
have been met, Issuing Bank will issue such Letter of Credit at Issuing Bank's
office in Dallas, Texas or at such other office of which Issuing Bank shall give
Borrower written notice. In the event of a conflict between any provision
contained in this Agreement and any provision contained in any LC Application,
the provision contained in this Agreement shall control.
Section 2.14 Reimbursement of Letters of Credit.
(a) Reimbursement by Borrower. Each payment of a draft or demand
for payment honored by Issuing Bank under a Letter of Credit
shall constitute a loan to and obligation of Borrower.
Promptly upon receipt of written notice of Issuing Bank's
honoring of a Letter of Credit, Borrower promises to pay to
Issuing Bank, or to Issuing Bank's order at Issuing Bank's
23
office in Dallas, Texas or at such other office of which
Issuing Bank shall give Borrower written notice, on demand, in
legal tender of the United States of America, any and all
amounts paid by Issuing Bank under such Letter of Credit,
together with interest on any such amounts from the date
payment is made by Issuing Bank under such Letter of Credit
until but not including the date of the repayment of such
amounts to Issuing Bank, at the Base Rate plus the Base Rate
Margin; provided that if any such payment or reimbursement
shall be reimbursed to Issuing Bank on the date Issuing Bank
makes such payment or disbursement, interest shall be payable
on the reimbursable amount at such rate for one (1) day. In
the event that Borrower fails to pay when due any Matured LC
Obligation owed by it to Issuing Bank, Administrative Agent
may, at its option, and without any notice or further
authorization from Borrower, make, pro rata on behalf of the
Lenders, a Revolving Loan Advance under this Agreement to
Borrower in the amount of such unpaid Matured LC Obligation
(whether or not such amount is less than the minimum Revolving
Loan Advance or would result in the outstanding Obligations
being greater than or equal to the Facility Amount), and apply
the proceeds of such Revolving Loan Advance to the payment of
such Matured LC Obligation. Borrower hereby expressly requests
and irrevocably authorizes Administrative Agent to do all of
the foregoing. Revolving Loan Advances used to refinance
Matured LC Obligations shall initially bear interest at the
Base Rate plus the Base Rate Margin. Borrower hereby promises
to pay, when and as due, all present and future levies, costs
and charges whatsoever imposed, assessed, levied or collected
on, under or in respect of this Agreement with respect to any
Letter of Credit and any payments of principal, interest or
other amounts made on or in respect of any thereof (excluding,
however, any such levies, costs and charges imposed on or
measured by the net income or receipts of Issuing Bank).
Borrower promises to indemnify Issuing Bank against, and to
reimburse Issuing Bank on demand for, any of the foregoing
levies, costs or charges paid by Issuing Bank and any loss,
liability, claim or expense, including interest, penalties and
legal fees, that Issuing Bank may incur because of or in
connection with the failure of Borrower to make any such
payment of levies, costs or charges when and as due or any
payment of Matured LC Obligations when and as due.
Borrower's obligation to reimburse Issuing Bank under this
paragraph (a) of this section for payments and disbursements
made by Issuing Bank under any Letter of Credit issued
pursuant to this section shall be absolute and unconditional
under any and all circumstances and irrespective of any
setoff, counterclaim or defense to payment which Borrower may
have or have had against Issuing Bank, the beneficiary of such
Letter of Credit, any Agent or any Lender, including, without
limitation, any defense based on the failure of the demand for
payment under such Letter of Credit to conform to the terms of
such Letter of Credit or the legality, validity, regularity or
enforceability of such Letter of Credit; provided, however,
that Borrower shall not be obligated to reimburse Issuing Bank
for any wrongful payment or disbursement made by Issuing Bank
under any Letter of Credit as a result of acts or omissions
constituting gross negligence or willful misconduct on the
part of Issuing Bank or any of its officers, employees or
agents.
(b) Reimbursement by Lenders. Issuing Bank irrevocably agrees to
grant and hereby grants to each Lender, and each Lender
irrevocably agrees to accept and purchase and hereby accepts
and purchases from Issuing Bank, on the terms and conditions
hereinafter stated, for such Lender's own account and risk an
undivided participation interest equal to such Lender's
Percentage Share of Issuing Bank's obligations and rights
under each Letter of Credit issued hereunder and the amount of
24
each draft paid by Issuing Bank thereunder. In the event that
Borrower should fail to pay Issuing Bank on demand the amount
of any draft or other request for payment drawn under a Letter
of Credit as provided in paragraph (a) of this section, each
Lender shall, before 2:00 p.m., Dallas, Texas time, on the
Business Day Issuing Bank shall have given notice to Lenders
of Borrower's failure to so pay Issuing Bank, if such notice
is given by 10:00 a.m., Dallas, Texas time (or on the Business
Day immediately succeeding the day such notice is given after
10:00 a.m., Dallas, Texas time), pay to Issuing Bank at
Issuing Bank's offices in Dallas, Texas, or at such other
office of which Issuing Bank shall have given Lenders written
notice, in legal tender of the United States of America, in
same day funds, such Lender's Percentage Share of the amount
of such draft or other request for payment plus interest on
such amount from the date Issuing Bank shall have paid such
draft or request for payment to the date of such payment by
such Lender at the Federal Funds Rate. Each Lender's
obligation to reimburse Issuing Bank pursuant to the terms of
this section is irrevocable and unconditional; provided,
however, that Lenders shall not be obligated to reimburse
Issuing Bank for any wrongful payment or disbursement made by
Issuing Bank under any Letter of Credit as a result of acts or
omissions constituting gross negligence or willful misconduct
on the part of Issuing Bank or any of its officers, employees,
or agents. Whenever, at any time after Issuing Bank has made
payment under any Letter of Credit and has received from any
Lender its Percentage Share of such payment in accordance with
this subsection, Issuing Bank receives any payment related to
such Letter of Credit (whether directly from Borrower or
otherwise, including proceeds of collateral applied thereto by
Issuing Bank), or any payment of interest on account thereof,
Issuing Bank will distribute to such Lender its Percentage
Share thereof; provided, however, that in the event that any
such payment received by Issuing Bank shall be required to be
returned by Issuing Bank, such Lender shall return to Issuing
Bank the portion thereof previously distributed by Issuing
Bank to it. Each Lender shall indemnify and hold Issuing Bank
harmless from and against any and all losses, liabilities
(including, without limitation, liabilities for penalties),
actions, suits, judgments, demands, damages, costs and
expenses (including, without limitation, attorneys' fees and
expenses) resulting from any failure on the part of such
Lender to provide, or from any delay in providing, in
accordance with this paragraph to Issuing Bank such Lender's
Percentage Share of the amount of any payment or disbursement
made by Issuing Bank to settle its obligations under any draft
drawn under any Letter of Credit.
(c) Cash Collateral Upon Event of Default. Upon the occurrence of
any Default or Event of Default and the acceleration of the
maturity of the Obligations, an amount equal to the amount of
the aggregate contingent liability of Issuing Bank and Lenders
in connection with each Letter of Credit then in effect shall
be deemed (as between Lenders and Borrower) to have been paid
or disbursed by Issuing Bank and Lenders under such Letter of
Credit (notwithstanding that such amount may not in fact have
been so paid or disbursed), and Borrower shall be immediately
obligated to pay to Administrative Agent for the pro rata
benefit of Lenders in accordance with their respective
Percentage Shares, the amount so deemed to have been so paid
or disbursed, which payment shall be made by depositing Cash
Collateral with Administrative Agent in accordance with the
provisions of paragraph (d) of this section.
(d) Procedures for Depositing and Returning of Cash Collateral.
Any cash collateral amounts received by Administrative Agent
pursuant to the provisions of paragraph (c) of this section
25
(the "Cash Collateral") shall be deposited in a separate
interest bearing cash collateral account maintained at the
offices of Administrative Agent or another Lender designated
by Administrative Agent under the sole dominion and control of
Administrative Agent and shall be retained by Administrative
Agent for the pro rata benefit of Lenders as collateral
security for, and Borrower hereby grants to Administrative
Agent for the benefit of the Lenders a security interest in
such Cash Collateral including all interest accruing thereon
and the proceeds thereof to secure, first the payment of the
Obligations of Borrower under or in connection with the
Letters of Credit, and then the other Obligations of Borrower
under and in connection with this Agreement and the other Loan
Documents, pro rata to each Lender in accordance with its
Advances and Percentage Share of all LC Obligations. All Cash
Collateral delivered to Administrative Agent may be applied by
Administrative Agent from time to time against any of
Borrower's reimbursement Obligations with respect to any
Letter of Credit as to which a draw is made. If and to the
extent that the Default or Event of Default giving rise to the
requirement for Cash Collateral has been cured to the
reasonable satisfaction of Required Lenders and any
acceleration of the Obligations has been rescinded and
annulled pursuant to Section 6.3 or (a) all Obligations of
Borrower have been fully paid and satisfied, (b) no Letters of
Credit remain outstanding and (c) Lenders' Commitments have
terminated, Administrative Agent shall promptly return to
Borrower, upon Borrower's request therefor, all amounts
previously paid to Administrative Agent pursuant to paragraph
(c) of this section and not theretofore returned by
Administrative Agent to Borrower or applied by Administrative
Agent to reduce amounts payable by Borrower to Lenders under
or with respect to the Letters of Credit or other amounts due
to Lenders or Agents hereunder or under the other Loan
Documents.
Section 2.15 Letter of Credit Fees. In consideration of Issuing Bank's
issuance of each Letter of Credit and each other Lender's agreement to purchase
a risk participation therein, Borrower agrees to pay to Administrative Agent:
(a) a letter of credit fronting fee for the account of the Issuing
Bank with respect to each Letter of Credit (other than the
Letters of Credit listed on Schedule 5) upon issuance of such
Letter of Credit in an amount equal to the greater of (x) $500
or (y) one-eighth of one percent (1/8 of 1%) per annum
calculated on the face amount thereof; and
(b) a letter of credit fee for the account of Lenders, to be
distributed to Lenders ratably in accordance with their
Percentage Shares, calculated on the face amount of each
Letter of Credit in the amount of the applicable Eurodollar
Margin, payable quarterly in arrears and at the expiration or
termination of each Letter of Credit. For purposes of this
Section 2.15(b), each Letter of Credit listed on Schedule 5
shall be deemed to have been issued on the Effective Date.
Section 2.16 Capital Reimbursement. If either (a) the introduction or
implementation of, or the compliance with, or any change in, or in the
interpretation of, any law, rule or regulation, or (b) the introduction or
implementation of or the compliance with any request, directive or guideline
from any central bank or Governmental Authority (whether or not having the force
of law) affects or would affect the amount of capital required to be maintained
by any Lender or any corporation controlling any Lender, then, upon demand by
such Lender, Borrower will immediately pay to Administrative Agent for the
benefit of such Lender, from time to time as specified by such Lender, such
additional amount which such Lender shall determine to be appropriate to
compensate such Lender or any corporation controlling such Lender in light
26
of such circumstances, to the extent that such Lender reasonably determines
that, because of the existence of such circumstances, the amount of any such
capital would be increased or the rate of return on any such capital would be
reduced, in whole or in part, by or as a consequence of the existence of such
Lender's Commitment, its Advances, its Percentage Share of LC Obligations, its
participation in any Swing Line Advances and its other commitments under this
Agreement to Borrower, subject to the provisions of Section 2.21.
Section 2.17 Increased Cost of Eurodollar Portions. If any applicable
domestic or foreign law, treaty, rule, directive or regulation (whether now in
effect or hereinafter enacted or promulgated, including Regulation D) or any
interpretation or administration thereof by any Governmental Authority charged
with the interpretation or administration thereof (whether or not having the
force of law):
(a) shall change the basis of taxation of payments to any Lender
of any principal, interest, or other amounts attributable to
any Eurodollar Portion of its Advances, its Percentage Share
of LC Obligations, its participation in any Swing Line
Advances or otherwise due under this Agreement in respect of
any Eurodollar Portion of its Advances, its Percentage Share
of LC Obligations or its participation in any Swing Line
Advances (other than taxes imposed on the overall net income
of such Lender or any lending office of such Lender by any
jurisdiction in which such Lender or any such lending office
is located);
(b) shall change, impose, modify, apply or deem applicable any
reserve, special deposit or similar requirements in respect of
any Eurodollar Portion of any Lender (excluding those for
which such Lender is fully compensated pursuant to adjustments
made in the definition of Adjusted Eurodollar Rate) or against
assets of, deposits with or for the account of, or credit
extended by, such Lender; or
(c) shall impose on any Lender, the certificate of deposit market
or the interbank eurocurrency deposit market any other
condition affecting any Eurodollar Portion;
and the result of any of the foregoing (a) through (c) is to (1) increase the
cost to any Lender of funding or maintaining any Eurodollar Portion, its
Percentage Share of any L/C Obligations or its participation in any Swing Line
Advances, as the case may be, or (2) to reduce the amount of any sum receivable
by any Lender in respect of any Eurodollar Portion, L/C Obligation or Swing Line
Advance, as the case may be, by an amount reasonably deemed by such Lender to be
material; then (i) such Lender shall promptly notify Administrative Agent and
Borrower in writing of the happening of such event, (ii) Borrower shall
thereafter upon demand pay to Administrative Agent for the account of such
Lender such additional amount or amounts as will compensate such Lender for such
additional cost or reduction, subject to the provisions of Sections 2.21 and
2.19, and (iii) Borrower may elect, by giving to Administrative Agent and such
Lender not less than three (3) Business Days' notice, to convert all (but not
less than all) of any such Eurodollar Portion into a Base Rate Portion.
Section 2.18 Availability. If (a) any change in applicable laws,
treaties, rules or regulations or in the interpretation or administration
thereof in any jurisdiction whatsoever, domestic or foreign, shall make it
unlawful or impracticable for any Lender to fund or maintain Eurodollar
Portions, or shall materially restrict the authority of any Lender to purchase
or take offshore deposits of dollars ("Eurodollars"), or to issue Letters of
Credit or fund its Percentage Share of LC Obligations, or (b) any Lender
determines that matching deposits appropriate to fund or maintain any Eurodollar
Portion are not available to it, or (c) any Lender determines that the formula
for calculating the Eurodollar Rate does not fairly reflect the cost to such
27
Lender of making or maintaining loans based on such rate, then, upon notice by
such Lender to Administrative Agent and to Borrower, Borrower's right to elect
Eurodollar Portions or to apply for Letters of Credit shall be suspended to the
extent and for the duration of such illegality, impracticability, restriction or
condition, and all Eurodollar Portions (or portions thereof) which are then
outstanding or are then the subject of any Rate Election and which cannot
lawfully or practicably be maintained or funded shall immediately become or
remain part of the Base Rate Portions of such Lender's Advances. Subject to the
provisions of Sections 2.21 and 2.19, Borrower agrees to indemnify
Administrative Agent and each Lender and hold Administrative Agent and each
Lender harmless against all costs, expenses, claims, penalties, liabilities and
damages which may result from any such change in law, treaty, rule, regulation,
interpretation or administration.
Section 2.19 Funding Losses. In addition to its other obligations
hereunder, subject to the provisions of Section 2.21, Borrower shall indemnify
each Lender against, and reimburse each Lender on demand for, any loss or
expense incurred or sustained by such Lender, determined as provided in this
section, as a result of (a) any payment or prepayment (whether authorized or
required hereunder or otherwise) of all or a portion of a Eurodollar Portion on
a day other than the day on which the applicable Eurodollar Interest Period
ends, (b) any payment or prepayment, whether required hereunder or otherwise, of
an Advance made after the delivery, but before the effective date, of a Rate
Election, if such payment or prepayment prevents such Rate Election from
becoming fully effective, (c) the failure of any Revolving Loan Advance or Swing
Line Advance to be made to Borrower or of any Rate Election of Borrower to
become effective due to any condition precedent to such Revolving Loan Advance
or Swing Line Advance not being satisfied, due to the inability of
Administrative Agent (acting reasonably and in accordance with Section 2.18) to
determine a Eurodollar Rate for a Eurodollar Portion or due to any other action
or inaction of any Designated Entity, (d) any conversion (whether authorized or
required hereunder or otherwise) of all or any portion of any Eurodollar Portion
into a Base Rate Portion or into a different Eurodollar Portion on a day other
than the day on which the applicable Eurodollar Interest Period ends, or (e) any
payment or prepayment of all or a portion of a Swing Line Advance on a day other
than the maturity date for such Swing Line Advance.
Upon the occurrence of an event as described in subsections (a) through
(e) of the immediately preceding paragraph, the method to be used by each Lender
to calculate the loss or expense incurred by reason of the liquidation or
reemployment of deposits or other funds required by such Lender to fund or
maintain Eurodollar Portions of Revolving Loan Advances or Swing Line Advances,
as the case may be, is as follows:
Funding Loss = P x (F-R) x D/360
P = principal amount of payment, prepayment, conversion, nonborrowing
or non-effective Rate Election
F = Eurodollar Rate or Swing Line Rate, as the case may be (adjusted
for Reserve Percentage), utilized in the calculations of the
Eurodollar Rate or Swing Line Rate, as the case may be, on the
Revolving Loan Advance or Swing Line Advance which is being paid,
prepaid, converted, not borrowed or not subject to effective Rate
Election
R = reinvestment rate (as hereinafter defined)
28
D = number of days from the date of the payment, prepayment,
conversion, non-borrowing or non-effectiveness until the day on
which the Eurodollar Interest Period of the Eurodollar Portion
ends or the Swing Line Advance matures
Reinvestment rate as it is used herein will be equal to the Eurodollar Rate,
adjusted for the Reserve Percentage, quoted to such Lender, or the Swing Line
Rate that would be quoted by such Lender, as the case may be, effective for the
date on which the payment, prepayment, conversion, non-borrowing or non-
effectiveness occurs. For purposes of determining the reinvestment rate for
purposes of this section, the Eurodollar Rate will be the quote for either one
(1) month, two (2) months, three (3) months, six (6) months, nine (9) months or
twelve (12) months, and the Swing Line Rate will be the quote for a number of
days between one (1) and fourteen (14), whichever most closely approximates (but
which may contain more or fewer days than) the number of days from the date of
the payment, prepayment, conversion, non-borrowing or non-effectiveness until
the last day of the relevant Eurodollar Interest Period or the scheduled
maturity, as the case may be, of the Eurodollar Portion, or Swing Line Advance,
as the case may be, in respect of which the payment, prepayment, conversion,
non-borrowing or non-effectiveness occurs; provided that if such number of days
in respect of a Eurodollar Rate is the midpoint between two such periods, such
rate will be the lower of the two rates for such periods.
Section 2.20 Taxes. All payments by Borrower of principal of, and
interest on, the Advances, the LC Obligations and all other amounts payable
hereunder shall be made free and clear of and without deduction for any present
or future income, excise, stamp, or franchise taxes and other taxes, fees,
duties, withholdings or other charges of any nature whatsoever imposed by any
taxing authority, but excluding franchise taxes and taxes imposed on or measured
by any Lender's or Agent's net income or receipts (such non-excluded items being
called "Taxes"). In the event that any withholding or deduction from any payment
to be made by Borrower hereunder is required in respect of any Taxes pursuant to
any applicable law, rule or regulation, then, subject to the provisions of
Section 2.21, Borrower will:
(a) pay directly to the relevant authority the full amount
required to be so withheld or deducted;
(b) promptly forward to Administrative Agent an official receipt
or other documentation satisfactory to Administrative Agent
evidencing such payment to such authority; and
(c) pay to Administrative Agent for the account of the applicable
Lender or Agent such additional amount(s) as is necessary to
ensure that the net amount actually received by such Lender or
Agent will equal the full amount such Lender or Agent would
have received had no such withholding or deduction been
required and Borrower hereby acknowledges that it is not
entitled to and will not seek recovery or restitution of any
amount due to any Lender or Agent and paid by Borrower
pursuant to this clause (c) or pursuant to the next sentence.
If any Taxes are directly asserted against any Lender or Agent with respect to
any payment received by such Agent or such Lender hereunder, such Lender or
Agent may pay such Taxes and, if paid in good faith, Borrower will promptly pay
such additional amounts to Administrative Agent for the account of such Lender
or Agent (including any penalties, interest or expenses) as is necessary in
order that the net amount received by such person after the payment of such
Taxes (including any taxes on such additional amount) shall equal the amount
such person would have received had no such Taxes been asserted, subject to the
provisions of Section 2.21.
29
Borrower shall pay all stamp, transaction, registration and similar
taxes (including financial institutions' duties, debit taxes or other taxes
payable by return and taxes passed on to any Lender or Agent by a bank or
financial institution (collectively "Stamp Taxes") and, if Borrower fails to pay
any such charges or taxes after reasonable notice from any such Lender or Agent,
fines and penalties) which may be payable or determined to be payable in
relation to the execution, delivery, performance or enforcement of this
Agreement or any Loan Document or any other transaction contemplated by any Loan
Document to which Borrower is a party. Borrower hereby indemnifies each Lender
and Agent against any liability resulting from delay or omission to pay such
charges or taxes except to the extent the liability results from failure by the
relevant Lender or Agent to pay any such tax after having been delivered funds
to do so by Borrower or to the extent such liability is for fines and penalties
resulting from such Lender's or Agent's failure to provide reasonable notice to
Borrower as provided herein.
If Borrower fails to pay any Taxes or Stamp Taxes when due to the
appropriate taxing authority or fails to remit to Administrative Agent, for the
account of the respective Lender or Agent, the required receipts or other
required documentary evidence, Borrower shall indemnify Lenders and Agents for
any Taxes, interest or penalties that may become payable by any Lender or Agent
as a result of any such failure, subject to the provisions of Section 2.21. For
purposes of this section, a distribution hereunder by any Lender or Agent to or
for the account of any Lender or Agent shall be deemed a payment by the subject
Borrower.
Borrower waives any statutory right to recover from any Lender or Agent
any amount due to any such Lender or Agent and paid by Borrower under this
section.
On or prior to the first date on which interest or fees are payable
hereunder for the account of any Lender, each Lender that is organized under the
laws of a jurisdiction other than the United States shall execute and deliver to
Administrative Agent, three (3) or more (as Administrative Agent may reasonably
request) United States Internal Revenue Service Forms W-8BEN or W-8ECI or such
other forms or documents (or successor forms or documents), appropriately
completed, as may be applicable to establish the extent, if any, to which a
payment to such Lender is exempt from withholding or deduction of United States
federal income taxes. Each Lender which so delivers a Form W-8BEN or W-8ECI
further undertakes to deliver to Administrative Agent three (3) additional
copies of such form (or a successor form) on or before the date that such form
expires or becomes obsolete or after the occurrence of any event requiring a
change in the most recent form so delivered by it, and such amendments thereto
or extensions or renewals thereof as may be reasonably requested by
Administrative Agent, in each case certifying that such Lender is entitled to
receive payments from Borrower under the Loan Documents without deduction or
withholding of any United States federal income taxes, unless an event
(including without limitation any change in treaty, law or regulation) has
occurred prior to the date on which any such delivery would otherwise be
required which renders all such forms of the type previously delivered
inapplicable or which would prevent such Lender from duly completing and
delivering such form with respect to it and such Lender advises Administrative
Agent that it is not capable of receiving such payments on the basis reflected
in such previously delivered form without any deduction or withholding of United
States federal income tax. Administrative Agent shall provide one (1) copy of
each of such forms or documents so provided to Borrower and Documentation Agent.
Section 2.21 Make-Whole Qualifications. Each Lender's claims for
reimbursements, payments, indemnities or otherwise under Sections 2.16, 2.17,
2.18, 2.19 and 2.20 and Borrower's obligation with respect thereto, shall be
limited and qualified by and subject to the following:
30
(a) Borrower's obligation to pay, satisfy or recognize such claim
shall be limited to costs or losses incurred within one (1)
year immediately prior to any demand or request therefor upon
Borrower;
(b) each Lender's demand for reimbursement, payment or indemnity
from Borrower must be limited to that which is being generally
applied at the time by such Lender for comparable borrowers
and credits subject to credit agreements similar to this
Agreement, but without regard to provisions similar to this
section;
(c) each Lender which asserts its rights with respect thereto or
which is seeking or imposing such reimbursement, payment or
indemnity shall provide evidence regarding the basis of such
claim and the calculation and application thereof in
reasonable detail and, in determining such amount, each Lender
may use reasonable methods of attribution and averaging;
(d) each Lender which is seeking payment or reimbursement pursuant
to Section 2.20 shall, if so requested by Borrower, use
reasonable efforts (subject to the overall policy
considerations of such Lender) to designate a different
lending office hereunder if to do so will avoid the need for,
or reduce the amount of, any such payment or reimbursement;
provided that such Lender would, in its sole but reasonable
determination, suffer no material economic, legal or
regulatory disadvantage or burden;
(e) Borrower may, in its sole discretion, elect, unless and until
the applicable Lender notifies Borrower that the circumstances
giving rise thereto no longer apply to such Lender, that, to
the extent that a Lender's claims for such reimbursements,
payments or indemnities would be reduced thereby, that subject
to Section 2.19, (1) all Advances to Borrower which would
otherwise be made by such Lender as Eurodollar Portions shall
be made instead as Base Rate Portions (all of which interest
and principal shall be payable as provided herein with respect
to the related Eurodollar Portions of the other Lenders), and
(2) after each Eurodollar Portion has been repaid, all
payments of principal, which would otherwise would be applied
to repay such Eurodollar Portions, shall be applied to repay
Base Rate Portions instead; and
(f) Borrower may designate a replacement Lender (which may be one
(1) or more of the then existing Lenders hereunder and which
shall be reasonably satisfactory to Administrative Agent) to
purchase the Advances and Percentage Share of LC Obligations
and Swing Line Obligations, in each case without recourse, and
assume the Commitment and all other obligations hereunder of
any Lender that has suspended the availability of Eurodollar
Portions pursuant to Section 2.18 or that has demanded
reimbursement, payment or indemnity under Sections 2.16, 2.17,
2.18, 2.19 or 2.20, and such Lender shall be obligated to
sell, transfer and deliver all of its Advances and Percentage
Share of LC Obligations and Swing Line Obligations to such
replacement Lender for the outstanding principal amount of
such Advances, plus such Lender's Percentage Share of LC
Obligations and Swing Line Obligations, plus in each case,
accrued interest thereon and such Lender's portion of accrued
but unpaid fees through the date of such purchase, and permit
such replacement lender to assume its Commitment. Borrower
shall be obligated to pay all additional amounts due to the
Lender being replaced pursuant to Sections 2.16, 2.17, 2.18,
2.19 and 2.20 through the date of such purchase and
assumption; provided, that if the replacement Lender fails to
purchase all such rights and interests and assume such
Commitment on the specified date
31
in accordance herewith, Borrower shall continue to be
obligated to pay such amounts to such Lender which was to have
been replaced and provided further that Borrower shall pay any
Taxes or Stamp Taxes, if any, as a result of such transfer.
ARTICLE 3
CONDITIONS PRECEDENT TO LENDING
Section 3.1 Initial Conditions Precedent. No Lender has any obligation
to make its first Revolving Loan Advance or Swing Line Advance and Issuing Bank
has no obligation to issue the first Letter of Credit (whether or not otherwise
agreed to by Issuing Bank) unless:
(a) Administrative Agent shall have received all of the following
with copies for each Lender, at Administrative Agent's office
in Dallas, Texas:
(1) This Agreement, the Notes (to the Lenders that have
requested Notes), the Guaranties and Pledge Agreements
listed on Schedule 4 hereto, and any other documents
required in connection herewith, each duly executed
and delivered and in form, substance and date
satisfactory to Administrative Agent.
(2) The following certificates:
(i) an "Omnibus Certificate" of the Secretary or
an Assistant Secretary and of a Designated
Officer, which shall contain the names and
signatures of the officers of Borrower
authorized to execute Loan Documents and which
shall certify to the truth, correctness and
completeness of the following exhibits
attached thereto: (A) a copy of resolutions
duly adopted by the Board of Directors of
Borrower and in full force and effect on the
Effective Date, authorizing the execution of
this Agreement and the other Loan Documents
delivered or to be delivered in connection
herewith and the consummation of the
transactions contemplated herein and therein,
(B) a copy of the charter documents of
Borrower and all amendments thereto, certified
by the appropriate official of Borrower's
jurisdiction of organization, and (C) a copy
of the bylaws or similar governing documents
of Borrower; and
(ii) a "Compliance Certificate" of a Designated
Officer of Borrower, of even date with such
Revolving Loan Advance or Swing Line Advance
or issuance of such Letter of Credit, in which
such officer certifies to the satisfaction of
the conditions set out in Section 3.2(a) and
(b) and that all conditions hereunder have
been satisfied.
(3) A certificate (or certificates) of the due formation,
valid existence and good standing of Borrower in its
jurisdiction of organization, issued by the
appropriate authorities of such jurisdiction.
32
(4) The favorable opinions of the counsel for each
Designated Entity, given upon their express
instructions substantially in the form set forth as
Exhibit G attached hereto.
(5) Documents similar to those specified in Section
3.1(a)(2)(i) and 3.1(a)(3) with respect to each
Restricted Subsidiary which is or will be party to a
Guaranty or Pledge Agreement on the date hereof.
(6) A certificate of a Designated Officer of Borrower
disclosing the insurance coverages on material assets
of the Designated Entities.
(7) A certificate of a Designated Officer of Borrower as
to the aggregate book value of the assets of the
Unrestricted Subsidiaries as of the Effective Date,
which aggregate book value shall not exceed
$10,000,000.
(b) Except as disclosed to the Lenders in the Disclosure Schedule
or otherwise in writing prior to the execution hereof and not
objected to by Required Lenders, there shall be no pending or
threatened litigation, action or proceeding against Borrower
or any of its Subsidiaries which, if adversely determined,
could reasonably be expected to have a Material Adverse
Effect.
(c) No event or condition shall have occurred since December 31,
1999 which could reasonably be expected to result in a
Material Adverse Effect.
(d) After giving effect to such Revolving Loan Advances, Swing
Line Advances and Letters of Credit, Borrower and Lenders
shall be in compliance with the Margin Regulations.
(e) All commitments under the Existing Credit Agreement shall have
been terminated.
Section 3.2 Additional Conditions Precedent. No Lender has any
obligation to make any Revolving Loan Advance or Swing Line Advance (including
the first) and Issuing Bank has no obligation to issue any Letter of Credit
(including the first) unless the following conditions precedent have been
satisfied:
(a) All representations and warranties made by any Designated
Entity in any Loan Document shall be true on and as of the
date of such Revolving Loan Advance or Swing Line Advance or
issuance of Letter of Credit as if such representations and
warranties had been made as of the date of such Revolving Loan
Advance or Swing Line Advance or issuance of such Letter of
Credit (unless stated to relate solely to an earlier date, in
which case such representations and warranties shall be true
and correct as of such earlier date).
(b) No Default shall exist at the date of such Revolving Loan
Advance or Swing Line Advance or issuance of Letter of Credit
or will occur as a result of the making of the requested
Revolving Loan Advance or Swing Line Advance or the issuance
of the requested Letter of Credit.
33
ARTICLE 4
REPRESENTATIONS AND WARRANTIES
Section 4.1 Borrower's Representations and Warranties. To confirm each
Lender's understanding concerning Borrower and its businesses, properties and
obligations, and to induce Agents and each Lender to enter into this Agreement
and to make the Advances to Borrower, except as to matters disclosed herein or
in the Disclosure Schedule, Borrower represents and warrants to Agents and each
Lender that:
(a) No Default. No Designated Entity is in default in the
performance of any of the covenants and agreements contained
herein or under any other Loan Document. No event or
circumstance has occurred and is continuing which constitutes
a Default.
(b) Organization, Existence and Good Standing. Each Designated
Entity is duly organized or incorporated, validly existing and
in good standing under the laws of its jurisdiction of
organization or incorporation, having all corporate or
partnership powers required to enter into and carry out the
transactions contemplated hereby. Each Designated Entity is
duly qualified, in good standing, and authorized to do
business in all other jurisdictions wherein the character of
the properties owned or held by it or the nature of the
business transacted by it makes such qualification necessary,
except for any lack of qualification, good standing or
authorization that could not reasonably be expected to have a
Material Adverse Effect. Each Designated Entity has taken all
actions customarily taken in order to enter, for the purpose
of conducting business or owning property, each jurisdiction
outside the United States wherein the character of the
properties owned or held by it or the nature of the business
transacted by it makes such actions desirable, except for any
failure or other matter that could not reasonably be expected
to have a Material Adverse Effect.
(c) Authorization. Each Designated Entity has duly taken all
corporate or partnership action necessary to authorize the
execution and delivery by it of the Loan Documents to which it
is a party and to authorize the consummation of the
transactions contemplated thereby and the performance of its
obligations thereunder. Borrower is duly authorized to borrow
funds hereunder.
(d) No Conflicts or Consents. The execution and delivery by each
Designated Entity of the Loan Documents to which it is a
party, the performance by each Designated Entity of its
obligations under such Loan Documents, and the consummation of
the transactions contemplated by the various Loan Documents,
do not and will not (1) conflict with any provision of the
articles or certificate of incorporation, bylaws, charter,
partnership agreement or certificate or other governing
document of such Designated Entity, or (2) except as to
matters that could not reasonably be expected to have a
Material Adverse Effect, result in the acceleration of any
Debt owed by such Designated Entity, or conflict with any law,
statute, rule, regulation, or material agreement, judgment,
license, order or permit applicable to or binding upon such
Designated Entity, or require the consent, approval,
authorization or order of, or notice to or filing with, any
Governmental Authority or third party, or result in or require
the creation of any Lien upon any material assets or
properties of such Designated Entity, except as permitted in
the Loan Documents.
34
(e) Enforceable Obligations. This Agreement is, and the other Loan
Documents when duly executed and delivered will be, legal,
valid and binding obligations of each Designated Entity which
is a party hereto or thereto, enforceable in accordance with
their terms except as such enforcement may be limited by
bankruptcy, insolvency or similar laws of general application
relating to the enforcement of creditors' rights generally and
by general principles of equity.
(f) Financial Statements. (i) The Updated Financial Statements
fairly present Borrower's and its Consolidated Subsidiaries'
financial position at the date thereof and the results of
Borrower's and its Consolidated Subsidiaries' operations and
cash flows for the period covered thereby. From the date of
the Updated Financial Statements to the Effective Date, no
change has occurred in Borrower's and its Subsidiaries'
Consolidated financial condition which could reasonably be
expected to result in a Material Adverse Effect, except as
reflected in the Disclosure Schedule. The Updated Financial
Statements were prepared in accordance with GAAP as in effect
on the date thereof.
(ii) The unaudited Consolidated financial statements
of Borrower and the Consolidated Subsidiaries at and for the
Fiscal Quarter ended March 31, 2000, heretofore delivered to
Lenders, fairly present Borrower's and its Consolidated
Subsidiaries' financial position at such date and the results
of Borrower's and its Consolidated Subsidiaries' operations
and cash flows for the period covered thereby. Such financial
statements were prepared in accordance with GAAP as in effect
on the date thereof, subject to year-end audit adjustments.
(g) Other Obligations. Except as disclosed in the Disclosure
Schedule , as of the Effective Date, neither Borrower nor any
of its Consolidated Subsidiaries has any outstanding Debt
which is, in the aggregate, material to Borrower and its
Consolidated Subsidiaries and not shown in the Updated
Financial Statements.
(h) Full Disclosure. No certificate, statement or other
information delivered herewith or heretofore by any Designated
Officer of any Designated Entity to any Agent or any Lender
in connection with the negotiation of this Agreement or in
connection with any transaction contemplated hereby contains
any untrue statement of a fact or omits to state any fact
known to Borrower or any Designated Entity (other than
industry-wide risks normally associated with the types of
businesses conducted by Borrower or any Designated Entity)
necessary to make the statements contained herein or therein
not misleading as of the date made or deemed made, except to
the extent that any untrue statement or omission could not
reasonably be expected to have a Material Adverse Effect.
(i) Litigation. Except as disclosed in the Updated Financial
Statements or in the Disclosure Schedule : (1) there are no
actions, suits or legal, equitable, arbitrative or
administrative proceedings pending, or, to the knowledge of
Borrower, threatened, against any Designated Entity before any
Governmental Authority that could reasonably be expected to
have a Material Adverse Effect, and (2) there are no
outstanding judgments, injunctions, writs, rulings or orders
by any such Governmental Authority against Borrower or any of
its Subsidiaries which could reasonably be expected to have a
Material Adverse Effect.
35
(j) Environmental Matters. The liabilities and costs of Borrower
and its Subsidiaries related to compliance with applicable
Environmental Laws (as in effect on the date on which this
representation is made or deemed made) could not reasonably be
expected to have a Material Adverse Effect.
(k) Title to Properties. Each Designated Entity has good and
defensible title to all of its material properties and assets,
except any failure, defect or other matter that could not, in
the aggregate, reasonably be expected to have a Material
Adverse Effect.
(l) Investment Company Act. Neither Borrower nor any of its
Subsidiaries is an "investment company" or a "company
controlled" by an "investment company", within the meaning of
the Investment Company Act of 1940, as amended.
(m) Public Utility Holding Company Act. Neither Borrower nor any
of its Subsidiaries is a "holding company", or a "Subsidiary
company" of a "holding company" or an "affiliate" of a
"holding company" or of a "Subsidiary company" of a "holding
company", or a "public utility" within the meaning of the
Public Utility Holding Company Act of 1935, as amended.
(n) Principal Business Offices. As of the Effective Date, each
Designated Entity's principal place of business and chief
executive office is located at the place described in the
Disclosure Schedule .
(o) Solvency. Each Designated Entity is solvent and will continue
to be solvent after the making and guarantying of the
Obligations and the issuance of the Letters of Credit.
(p) Organization. As of the Effective Date, the organization chart
of Borrower and its Subsidiaries with material assets set
forth on Exhibit H is true and correct in all material
respects. Except for the Exchangeable Shares, as of the
Effective Date, Borrower or a R estricted Subsidiary owns all
of the issued and outstanding capital stock of each Restricted
Subsidiary. As of the Effective Date, no Restricted Subsidiary
has issued any securities convertible into shares of its stock
or any options (except as set forth in the Disclosure
Schedule), warrants or other rights to acquire such shares or
securities convertible into such shares and the outstanding
capital stock and securities of each Restricted Subsidiary is
owned by Borrower or another Restricted Subsidiary free and
clear of all Liens, warrants, options or rights of others of
any kind whatsoever, except for Permitted Liens.
(q) Use of Proceeds: Margin Stock. Borrower and its Subsidiaries
shall use (i) the initial Revolving Loan Advance to discharge
all outstanding obligations (other than in respect of Letters
of Credit listed on Schedule 5 under the Existing Credit
Agreement), and (ii) all Revolving Loan Advances, Letters of
Credit and Swing Line Advances for its and their respective
general corporate purposes. In no event shall the funds from
any Revolving Loan Advance, Swing Line Advance or Letter of
Credit be used directly or indirectly by any Person for
personal, family, household or agricultural purposes or for
the purpose, whether immediate, incidental or ultimate, of
purchasing, acquiring or carrying any "margin stock" or any
"margin securities" (as such terms are defined in the Margin
Regulations) in violation of the Margin Regulations, or for
the purpose of reducing or retiring any indebtedness which
was originally incurred to purchase or carry "margin stock" or
"margin securities" in violation of the Margin Regulations, or
36
to extend credit to others directly or indirectly for the
purpose of purchasing or carrying any such margin stock or
margin securities in violation of the Margin Regulations.
Borrower is not engaged principally, or as one of Borrower's
important activities, in the business of extending credit to
others for the purpose of purchasing or carrying such margin
stock or margin securities. Neither any Designated Entity nor
any Person acting on behalf of any Designated Entity has taken
or will take any action which might cause this Agreement, any
Note, any Guaranty, any Loan Document or any Advance or Letter
of Credit to violate the Margin Regulations or to violate
Section 7 of the Securities Exchange Act of 1934, or any rule
or regulation thereunder, in each case as now or hereafter in
effect.
(r) ERISA Compliance. Each ERISA Plan is in compliance in all
material respects with the applicable provisions of ERISA, the
Code and other applicable laws. There are no pending or, to
the best knowledge of Borrower, threatened claims, actions or
lawsuits, or action by any Governmental Authority, with
respect to any ERISA Plan that could reasonably be expected to
have a Material Adverse Effect. There has been no prohibited
transaction or violation of the fiduciary responsibility rules
with respect to any ERISA Plan that could reasonably be
expected to have a Material Adverse Effect. No Termination
Event has occurred which could reasonably be expected to have
a Material Adverse Effect.
Section 4.2 Representation by Lenders. Each Lender hereby represents
that it will acquire its Notes, if any, for its own account in the ordinary
course of its commercial lending business; however, such Lender may sell or
otherwise transfer its Notes, if any, any participation interest or other
interest in its Notes, if any, or any of its other rights and obligations under
the Loan Documents as permitted by Section 8.8.
ARTICLE 5
COVENANTS OF BORROWER
Section 5.1 Affirmative Covenants. To conform with the terms and
conditions under which each Lender is willing to have credit outstanding to
Borrower, and to induce Agents and each Lender to enter into this Agreement and
make the Advances to Borrower and to issue Letters of Credit, unless Required
Lenders shall have previously agreed otherwise in writing, Borrower, severally
for itself and its Subsidiaries, covenants and agrees that:
(a) Payment and Performance. Borrower will pay all amounts due
from it under the Loan Documents in accordance with the terms
thereof and will observe, perform and comply with every
covenant, term and condition expressed in the Loan Documents,
and will cause each Designated Entity which is a Subsidiary of
Borrower to perform and comply with every covenant, term and
condition expressed in the Loan Documents and applicable to
such Designated Entity.
(b) Books, Financial Statements and Reports. Borrower will at all
times maintain full and materially accurate books of account
and records. Borrower will maintain and will cause its
Subsidiaries to maintain a standard system of accounting and
will cause the following statements and reports to be
delivered to Agents and each Lender (Agents only in the case
of clause (3) below) at Borrower's expense:
37
(1) As soon as available, and in any event within 120 days
after the end of each Fiscal Year, complete audited
Consolidated financial statements of Borrower and its
Subsidiaries and unaudited consolidating balance
sheets and statements of operations of Borrower and
its Subsidiaries, prepared in reasonable detail in
accordance with GAAP; such audited statements to be
accompanied by an opinion, by Ernst & Young LLP, or
such other independent certified public accountants of
nationally recognized standing selected by Borrower,
stating that such Consolidated financial statements
have been so prepared. Borrower will, together with
each set of such financial statements delivered
pursuant to this section, furnish a certificate in the
form of Exhibit I signed by a Designated Officer of
Borrower stating that, to the best of his knowledge,
(i) such financial statements are accurate and
complete, and (ii) no Default or Event of Default
exists at the end of such Fiscal Year or at the time
of such certificate or specifying the nature and
period of existence of any such Default or Event of
Default. Such certificate shall contain calculations
showing compliance (or noncompliance) at the end of
such Fiscal Year with the requirements of Sections
5.2(e) and 5.3(a), (b), and (c).
(2) As soon as available, and in any event within 60 days
after the end of the first three Fiscal Quarters in
each Fiscal Year, unaudited Consolidated financial
statements of Borrower and its Subsidiaries and
unaudited consolidating balance sheet and statements
of operations of Borrower and its Subsidiaries as of
the end of such Fiscal Quarter, all in reasonable
detail and prepared in accordance with GAAP, subject
to changes resulting from year-end adjustments.
Borrower will, together with each set of such
financial statements delivered pursuant to this
section, furnish a certificate in the form of Exhibit
I signed by a Designated Officer of Borrower stating
that, to the best of his knowledge, (i) such financial
statements are accurate and complete, and (ii) no
Default or Event of Default exists at the end of such
Fiscal Quarter or at the time of such certificate or
specifying the nature and period of existence of any
such Default or Event of Default. Such certificate
shall contain calculations showing compliance (or
noncompliance) at the end of such Fiscal Quarter with
the requirements of Sections 5.2(e) and 5.3(a) and
(b).
(3) Within 120 days after the end of each Fiscal Year (but
only at such times as the Applicable Rating Level is
Level II, Level III or Level IV), an Engineering
Report.
(4) Promptly after transmittal or filing, copies of all
financial statements, reports, notices and proxy
statements sent by Borrower to its stockholders and
all registration statements, periodic reports and
other statements and schedules filed by Borrower or
any of its Subsidiaries with any securities exchange,
the Securities and Exchange Commission or any similar
Governmental Authority.
(c) Other Information and Inspections. Borrower will furnish to
Agents and each Lender any information which Administrative
Agent, on behalf of any Lender, may from time to time
reasonably request in writing concerning any covenant,
provision or condition of the Loan Documents or any matter in
connection with Borrower's and its Subsidiaries' businesses
and operations. Borrower will permit and will cause each of
its Subsidiaries to permit representatives of Agents and
Lenders (including independent accountants, agents and
38
attorneys), at the expense and risk of the applicable Agent or
Lender, to visit and inspect, during normal business hours and
upon reasonable notice any of Borrower's or such Subsidiaries'
property, including its books of account, other books and
records, and any facilities or other business assets, and to
make extra copies therefrom and photocopies and photographs
thereof, and to write down and record any information such
representatives obtain, and Borrower shall permit and will
cause each of its Subsidiaries to permit Agents and Lenders or
their representatives, to investigate and verify the accuracy
of the information furnished to any Agent or Lender in
connection with the Loan Documents and to discuss all such
matters with its officers, employees and representatives;
provided, however, that any such visit, inspection,
investigation or verification or discussion with respect to
Borrower taking place at a time when Borrower has been
notified in writing by Administrative Agent of the existence
of a Default or an Event of Default applicable to Borrower has
occurred and is continuing shall be at the cost and expense of
Borrower, and that no Agent or Lender shall have any
obligation to pay any costs or expenses of Borrower or any
other Designated Entity or any of their officers, employees or
representatives in respect thereof irrespective of the
existence of any Default or Event of Default.
(d) Notice of Material Events. Borrower will promptly upon its
awareness thereof notify Administrative Agent and each Lender
(1) of the occurrence of any Default or any other event which
has or may reasonably be expected to have a Material Adverse
Effect, (2) of the acceleration of the maturity of any Debt
owed by any Designated Entity or any default by any Designated
Entity under any instrument evidencing or governing Debt, if
such acceleration or default has or may reasonably be expected
to have a Material Adverse Effect, (3) of the occurrence of
any Termination Event which has or may reasonably be expected
to have a Material Adverse Effect, and (4) of the filing of
any litigation or proceeding in which any Designated Entity is
a party or of any material developments in existing litigation
in which any Designated Entity is a party in which an adverse
decision may reasonably be expected to have a Material Adverse
Effect.
(e) Maintenance of Existence and Qualifications. Borrower will,
and will cause each Restricted Subsidiary to, maintain and
preserve its existence as a corporation or partnership, as the
case may be. Borrower will, and will cause each Restricted
Subsidiary to, maintain and preserve its good standing and its
rights and franchises in full force and effect and qualify to
do business as a foreign corporation in all states or
jurisdictions where required by applicable law, except for any
failure to maintain, preserve and qualify that could not
reasonably be expected to have a Material Adverse Effect.
Nothing in this section shall prohibit (i) a merger or
consolidation permitted by Section 5.2(c) or (ii) a
termination of such existence, good standing, rights or
franchises of any Restricted Subsidiary if Borrower determines
in good faith that such termination is in the best interest of
Borrower and could not reasonably be expected to have a
Material Adverse Effect.
(f) Payment of Taxes and Trade Debt. Borrower will, and will cause
each of its Subsidiaries to, except for any failure or other
matter that could not reasonably be expected to have a
Material Adverse Effect, (1) timely file all required tax
returns, (2) timely pay all taxes, assessments, and other
governmental charges or levies imposed upon it or upon its
income, profits or property, and (3) timely pay all trade
debt. Borrower and its respective Subsidiaries may, however,
delay paying or discharging any such taxes, assessments,
charges, debts or levies so long as the validity thereof is
contested in good faith by appropriate proceedings and
39
adequate reserves therefor in accordance with GAAP have been
set aside and reflected among the books and records of
Borrower and its Subsidiaries.
(g) Insurance. Borrower will, and will cause each of its
Subsidiaries to, at all times maintain insurance in such
amounts and covering such risks as are in accordance with
normal industry practice for companies engaged in similar
businesses and owning similar properties in the same general
area in which Borrower and its Subsidiaries conduct business,
which insurance (other than prudent self-insurance programs)
shall be by financially sound and reputable insurers.
(h) Payment of Expenses. Whether or not the transactions
contemplated by this Agreement are consummated, Borrower will
promptly pay all reasonable costs and expenses (including
reasonable attorneys' fees) incurred by or on behalf of (1)
the Administrative Agent in connection with the negotiation,
preparation, execution and delivery of the Loan Documents and
any amendment, modification or restatement thereof, and any
and all consents, waivers or other documents or instruments,
including commitment letters, term sheets and any memorandum
relating thereto, or in connection with the performance of its
duties as administrative agent under the Loan Documents other
than in the normal course of business, (2) Agents in
connection with due diligence, syndication, travel and
advertising related to this Agreement and the transactions
contemplated thereby, and (3) each Agent and each Lender in
connection with enforcement of the Loan Documents or the
defense of any Agent's or any Lender's exercise of its rights
thereunder, or in connection with any refinancing or
restructuring of any of the Loan Documents in the nature of a
"workout" (whether or not as a part of any insolvency or
bankruptcy proceeding). The selection of Agents' counsel and
consultants in connection with the matters described in
clauses (1) and (2) of the preceding sentence shall be subject
to the approval of Borrower, which approval shall not be
unreasonably withheld. Attorneys' fees reimbursed by Borrower
for any amendment, modification or restatement of any Loan
Document shall be estimated and approved by Borrower prior to
incurrence, such approval not to be unreasonably withheld.
Attorneys' fees reimbursed by Borrower in connection with the
enforcement of the Loan Documents or the defense of any
Agent's or any Lenders' exercise of its rights hereunder or in
connection with any refinancing or restructuring of any of the
Loan Documents in the nature of a "workout" shall be for a
single law firm per country (unless conflicts (including
conflicts between any Agent and any Lender as determined in
the reasonable discretion of the Required Lenders) otherwise
prohibit the engagement of a single law firm).
(i) Compliance with Agreements and Law. Borrower will, and will
cause each of its Subsidiaries to (1) perform all material
obligations it is required to perform under the terms of each
material agreement, contract or other instrument or obligation
to which it is a party or by which it or any of its material
properties is bound, except for any non-performance that will
not have or reasonably be expected to have a Material Adverse
Effect; and (2) conduct its business and affairs in material
compliance with all laws, regulations, and orders applicable
thereto (including without limitation Environmental Laws)
except for any non-compliance that could not reasonably be
expected to have a Material Adverse Effect.
(j) Maintenance of Business. Borrower will, and will cause each
Restricted Subsidiary to, maintain as its primary business the
exploration, production and development of oil, natural gas
40
and other liquid and gaseous hydrocarbons and the gathering,
processing, transmission and marketing of hydrocarbons and
activities related or ancillary thereto.
(k) Operations. Borrower will, and will cause each Restricted
Subsidiary to, cause all material properties to be regularly
operated, maintained and developed in a good and workmanlike
manner, as would a prudent operator and in accordance with all
applicable federal, state and local laws, rules and
regulations, except for any failure to so operate, maintain
and develop that could not reasonably be expected to have a
Material Adverse Effect.
Section 5.2 Negative Covenants. To conform with the terms and
conditions under which each Lender is willing to have credit outstanding to
Borrower, and to induce Administrative Agent and each Lender to enter into this
Agreement and make the Advances to Borrower and to issue Letters of Credit,
unless Required Lenders shall have previously agreed otherwise in writing,
Borrower, severally for itself and its Subsidiaries, covenants and agrees that:
(a) Limitation on Debt. Borrower will not, and will not permit any
Restricted Subsidiary to, in any manner owe or be liable for
Debt except:
(1) the Obligations;
(2) unsecured Debt among Designated Entities;
(3) Debt arising under capital leases which does not in
the aggregate for Borrower and all Restricted
Subsidiaries exceed $20,000,000 at any one time
outstanding;
(4) Debt, other than Debt otherwise permitted by another
subparagraph of this Section 5.2(a), which, at the
time incurred, is at prevailing market rates of
interest and contains covenants and conditions and
events of default no more onerous to the Designated
Entities than the terms of this Agreement; provided,
that no Default or Event of Default will result from
the incurrence of such Debt and be continuing;
(5) guaranties of Debt which is the primary obligation of
a Designated Entity and permitted under this Section
5.2(a);
(6) Debt arising (whether by contract or as a result of
statutory liability of a general partner) by virtue of
any Designated Entity being a general partner of a
general or limited partnership pursuant to agreements
in effect on the date hereof not in excess of the
aggregate amounts permitted to be incurred pursuant to
such agreements on the date hereof for all such Debt
and other such Debt otherwise permitted pursuant to
the other subparagraphs of this Section 5.2(a); and
(7) Debt existing on the Effective Date which is disclosed
(i) in the Updated Financial Statements or (ii) in the
Disclosure Schedule and any extensions, renewals or
replacements thereof upon terms no more onerous to
Borrower than the terms of this Agreement or the terms
of the instruments evidencing such Debt as of the date
of this Agreement.
41
(b) Negative Pledge. Borrower will not, and will not permit any
of its Restricted Subsidiaries to, create, assume or permit to
exist any Lien upon any of their respective material
properties, except Permitted Liens.
(c) Limitation on Mergers. Except as expressly provided in this
subsection, Borrower will not, and will not permit any of its
Restricted Subsidiaries to, merge or consolidate with or into
any other business entity, except (1) Borrower may be party to
a merger or consolidation so long as the surviving entity is
Borrower and no Default will exist and the Obligations do not
exceed the Facility Amount after giving effect thereto and (2)
any Restricted Subsidiary may be a party to any merger or
consolidation so long as the surviving entity is Borrower or a
Restricted Subsidiary and any Guaranty of such Restricted
Subsidiary continues as to such surviving entity, no Default
will exist, and the Obligations do not exceed the Facility
Amount, in each case after giving effect thereto.
(d) Limitation on Disposition of Capital Stock of Restricted
Subsidiaries. Borrower will not, and will not permit any
Restricted Subsidiary to, sell, transfer or otherwise dispose
of capital stock of any Restricted Subsidiary, except that
Borrower and any Restricted Subsidiary may sell, issue,
transfer or otherwise dispose of the capital stock of any
Restricted Subsidiary to Borrower or to another Restricted
Subsidiary.
(e) Limitation on Restricted Payments. Borrower will not and will
not permit any of its Subsidiaries to pay or declare
Restricted Payments (of the kind described in clause (i) of
the definition of Restricted Payment) with respect to
Borrower's or any Restricted Subsidiary's capital stock in
excess of $50,000,000 in the aggregate for all such Restricted
Payments during any Fiscal Year. Borrower will not, and will
not permit any Restricted Subsidiary to, make any Restricted
Payments (of the kind described in clause (ii) of the
definition of Restricted Payment) in excess of $10,000,000 in
the aggregate for all such Restricted Payments during any
Fiscal Year; provided, however, that in the event that any
Unrestricted Subsidiary of Borrower is redesignated to be a
Restricted Subsidiary of Borrower for purposes of this
Agreement, then for purposes of redetermining compliance with
this section, such Restricted Payments made to such
Unrestricted Subsidiary during the Fiscal Year of
redesignation shall be deducted from the aggregate total of
such Restricted Payments made during such Fiscal Year.
Borrower will not, and will not permit any of its Subsidiaries
to declare any dividend or distribution, make any Restricted
Payment (other than dividends or distributions not in
violation of this provision at the time declared), or
purchase, redeem, or otherwise acquire or retire for value,
prior to scheduled maturity, or repay, any Debt that is
subordinated in right of payment to the Obligations (1) if the
Obligations shall exceed the Facility Amount, (2) if any
Default or Event of Default shall have occurred and be
continuing, or (3) if as a result thereof, any Default or
Event of Default shall occur and be continuing.
(f) Transactions with Affiliates. Borrower will not, and will not
permit any of its Restricted Subsidiaries to, engage in any
material transaction with any of Borrower's Affiliates on
terms which are less favorable than those which would have
been obtainable at the time in arm's-length dealing with
Persons other than such Affiliates, provided, however that
such restriction shall not apply to transactions (i) among
Borrower and its Restricted Subsidiaries and (ii) among
Restricted Subsidiaries.
42
(g) Limitations on Restricted Subsidiaries. Borrower will not
permit any Restricted Subsidiary to become subject to
covenants which:
(1) restrict dividends or dividend capacity;
(2) restrict loans and advances to Borrower;
(3) restrict the ability to make tax payments or
management payments to Borrower; or
(4) restrict the capitalization structure of any
Restricted Subsidiary.
(h) Limitation on Sale/Leasebacks. Designated Entities will not
enter into any arrangement, directly or indirectly, with any
Person whereby any Designated Entity shall sell or transfer
any material asset, and whereby any Designated Entity shall
then or immediately thereafter rent or lease as lessee such
asset or any part thereof.
(i) Conversion between Restricted Subsidiary and Unrestricted
Subsidiary. Borrower may convert any Restricted Subsidiary to
an Unrestricted Subsidiary by giving Administrative Agent at
least five (5) Business Days' notice of such conversion in the
form of Exhibit J-1 attached hereto; provided that (1) no
Restricted Subsidiary may be converted to an Unrestricted
Subsidiary if, after giving effect thereto, a Restricted
Subsidiary would be a Subsidiary of an Unrestricted Subsidiary
or the sum of (A) the value of the assets of all Restricted
Subsidiaries converted to Unrestricted Subsidiaries during a
Fiscal Year (such value to be determined at the time of each
conversion), plus (B) all Restricted Payments (of the kind
described in clause (ii) of the definition of Restricted
Payment) made during such Fiscal Year does not exceed the
limitation on Restricted Payments (of the kind described in
clause (ii) of the definition of Restricted Payment) contained
in Section 5.2(e) hereof, and (2) no such conversion shall be
made if after giving effect to such conversion, any Default
would exist. Upon any such conversion of a Restricted
Subsidiary to an Unrestricted Subsidiary, (A) such Subsidiary
shall be released from its obligations under its Guaranty, and
Administrative Agent shall execute and deliver a release
substantially in the form of Exhibit J-2 hereto, and (B) if a
Pledge Agreement has theretofore been executed covering the
capital stock of, partnership interests in, or other ownership
interests in, such Subsidiary, Collateral Agent shall execute
and deliver a release of such Pledge Agreement and shall
return all stock certificates or other evidences of ownership
interests and any blank stock powers or share transfers
delivered in connection with such Pledge Agreement. Borrower
may convert any Unrestricted Subsidiary to a Restricted
Subsidiary by giving Administrative Agent at least five (5)
Business Days' notice of such conversion in the form of
Exhibit J-1 attached hereto; provided that no such conversion
may be made if after giving effect to such conversion, any
Default would exist.
(j) Margin Securities. Proceeds of the Advances will not be used
to purchase or carry Margin Stock except in compliance with
the Margin Regulations.
Section 5.3 Financial Covenants. To conform with the terms and
conditions under which each Lender is willing to have credit outstanding to
Borrower, and to induce Administrative Agent and each Lender to enter into this
Agreement and make the Advances to Borrower and to issue Letters of Credit,
unless
43
Required Lenders shall have previously agreed otherwise in writing, Borrower,
severally for itself and its Subsidiaries, covenants and agrees that:
(a) Total Leverage Ratio. Borrower's Consolidated Total Leverage
Ratio will not (i) as of the last day of any Fiscal Quarter
ending on or after March 31, 2000 and on or prior to September
30, 2002, be greater than 4.00 to 1.00, and (ii) as of the
last day of any Fiscal Quarter ending on or after December 31,
2002, be greater than 3.75 to 1.00.
(b) Minimum Consolidated Tangible Net Worth. Borrower will not
permit its Consolidated Tangible Net Worth as of the end of
any Fiscal Quarter, commencing with the Fiscal Quarter ending
March 31, 2000, to be less than (i) $658,000,000 plus (ii) an
amount equal to 50% of the sum of Borrower's and its
Subsidiaries' Consolidated net income for each Fiscal Quarter,
beginning with the Fiscal Quarter ending March 31, 2000,
during which such Consolidated net income is greater than $0,
plus (iii) an amount equal to 50% of the net cash proceeds
received by the Borrower and its Subsidiaries from the
issuance of any common stock, preferred stock or other equity
during any Fiscal Quarter, beginning with the Fiscal Quarter
ending March 31, 2000.
(c) Properties NPV to Total Debt Ratio. At such times as the
Applicable Rating Level is Level II, Level III or Level IV,
Borrower will not, as of December 31 of any year, permit the
ratio of the Properties NPV to Total Funded Debt to be less
than 1.25 to 1.00.
ARTICLE 6
EVENTS OF DEFAULT AND REMEDIES
Section 6.1 Events of Default. Each of the following events constitutes
an "Event of Default" under this Agreement:
(a) Borrower shall default on the payment when due of any
principal on any of its Advances or any amount in respect of
any LC Obligations;
(b) Borrower fails to pay any of its Obligations (other than
principal or any amount in respect of its LC Obligations) when
due and payable, whether interest in respect of any Advance or
any fee or any other amounts payable under any of the Loan
Documents and such failure shall continue unremedied for a
period of five (5) Business Days; provided, however, that any
such Default shall not constitute an Event of Default if
subsequently available information indicates that a payment
made when due was insufficient because of a good faith error
in calculation so long as Borrower shall cure such deficiency
within five (5) Business Days after Borrower becomes aware of
such deficiency;
(c) any Designated Entity fails to duly observe, perform or comply
with any covenant, agreement, condition or provision set forth
in Section 5.1(d), 5.2 or 5.3 of this Agreement;
(d) any Designated Entity fails (other than as referred to in
subsections (a), (b) and (c) above) to duly observe, perform
or comply with any covenant, agreement, condition or provision
of any Loan Document applicable to it (even if all or part of
such agreement or covenant is void or unenforceable), and such
failure is not remedied within thirty (30) Business Days after
44
written notice thereof shall have been sent to Borrower by
Administrative Agent or any Lender;
(e) any representation or warranty previously, presently or
hereafter made in writing or deemed made by or on behalf of
any Designated Entity in connection with any Loan Document
shall have been false or incorrect in any material respect on
any date on or as of which made and either (1) an Executive
Officer of Borrower had actual knowledge that such
representation or warranty was false or incorrect in a
material respect when made or (2) if no Executive Officer had
such knowledge, such representation or warranty shall continue
to be false or incorrect in any material respect thirty (30)
Business Days after the earlier of an Executive Officer of
Borrower obtaining actual knowledge thereof or written notice
thereof shall have been sent to Borrower by Administrative
Agent or any Lender;
(f) any Designated Entity (1) fails to pay when due Debt in excess
of $20,000,000 or (2) breaches or defaults in the performance
of any agreement or instrument by which any such Debt in
excess of $20,000,000 is issued, evidenced, governed, or
secured, and any such failure, breach or default continues
beyond any applicable period of grace provided therefor;
(g) either (1) any "accumulated funding deficiency" (as defined in
Section 412(a) of the Internal Revenue Code of 1986, as
amended) in excess of $10,000,000 exists with respect to any
ERISA Plan, whether or not waived by the Secretary of the
Treasury or his delegate, or (2) any Termination Event which
has a Material Adverse Effect occurs with respect to any ERISA
Plan and the then current value of such ERISA Plan's benefit
liabilities exceeds the then current value of such ERISA
Plan's assets available for the payment of such benefit
liabilities by more than $10,000,000 (or in the case of a
Termination Event involving the withdrawal of a substantial
employer, the withdrawing employer's proportionate share of
such excess exceeds such amount);
(h) any Designated Entity:
(1) suffers the commencement of any involuntary
bankruptcy, reorganization, debt arrangement, winding
up, dissolution, official management or
administration, or other case or proceeding under any
bankruptcy or insolvency law or the entry against it
of a judgment, decree or order for relief by a court
of competent jurisdiction in such a case or
proceeding, which in either case remains undismissed
for a period of sixty (60) days; provided that each
Designated Entity hereby expressly authorizes each
Agent and each Lender to appear in any court
proceeding during such sixty (60) day period to
preserve, protect and defend their rights under the
Loan Documents;
(2) commences a voluntary case under any applicable
bankruptcy, insolvency or similar law now or hereafter
in effect, including, without limitation, the United
States Bankruptcy Code or the Corporations Law of
Australia, as from time to time amended; or applies
for or consents or acquiesces to the entry of an order
for relief in an involuntary case under any such law,
or becomes insolvent or makes a general assignment for
the benefit of creditors, or falls generally to pay
(or admits in writing its inability to pay) its debts
as such debts become due, or takes corporate or other
action to authorize any of the foregoing;
45
(3) suffers the appointment of or taking possession by a
receiver, liquidator, assignee, custodian, trustee,
sequestrator, administrator or similar official of all
or a substantial part of its assets in a proceeding
brought against or initiated by it, and such
appointment is neither made ineffective nor discharged
within sixty (60) days after such event or such
appointment or taking possession is at any time
consented to, requested by, or acquiesced to by such
Designated Entity;
(4) suffers the entry against it of a final judgment for
the payment of money in excess of $20,000,000 (not
covered by insurance satisfactory to Administrative
Agent in its discretion), unless the same is
discharged within thirty (30) days after the date of
entry thereof or an appeal or appropriate proceeding
for review thereof is taken within such period and a
stay of execution pending such appeal is obtained and
continues; or
(5) suffers a writ or warrant of attachment or any similar
process to be issued by any court against all or any
substantial part of its property, and such writ or
warrant of attachment or any similar process is not
stayed or released within thirty (30) days after the
entry or levy thereof or after any stay is vacated or
set aside;
(i) (a) any person (other than Borrower, a Restricted Subsidiary
of Borrower or any employee benefit plan of Borrower or any of
its Restricted Subsidiaries) or group (as such term is used in
Section 13(d) or 14(d)(2) of the Securities Exchange Act of
1934, as amended) shall acquire, directly or indirectly,
beneficial ownership of an aggregate of 35% or more of the
issued and outstanding voting stock of Borrower; or (b) during
any period of two consecutive years ending on or after the
Effective Date, as determined as of the last day of each
calendar quarter after the Effective Date, the individuals
(the "Incumbent Directors") who at the beginning of such
period constituted the Board of Directors of Borrower (other
than additions thereto or removals therefrom from time to time
thereafter approved by a vote of at least two-thirds of such
Incumbent Directors) shall cease for any reason to constitute
50% or more of the Board of Directors of Borrower; provided,
however, that for each determination period ending on or
before June 30, 2002, each determination period shall be
deemed to be a period from the Effective Date through the date
of such calculation; or (c) Borrower shall adopt a plan
relating to the liquidation or dissolution of Borrower; or (d)
Borrower shall sell all or substantially all of its assets
(determined on a Consolidated basis) to another Person (except
as permitted by Section 5.2(c));
(j) any of the Loan Documents or any Lien created thereby are
determined to be invalid or unenforceable in any material
respect;
(k) any Restricted Subsidiary (other than an Excluded Restricted
Subsidiary) fails to execute and deliver to Administrative
Agent a Guaranty within 30 days after becoming a Restricted
Subsidiary, or any Restricted Subsidiary that ceases to be an
Excluded Restricted Subsidiary fails to execute and deliver to
Administrative Agent a Guaranty within 30 days after the
determination has been made that such Restricted Subsidiary is
no longer an Excluded Restricted Subsidiary; or
46
(l) Borrower or any Restricted Subsidiary fails (i) to execute and
deliver to Collateral Agent a Pledge Agreement covering the
capital stock, partnership interests, or other ownership
interests directly owned by it in each Person that is a
Restricted Subsidiary (other than a Restricted Subsidiary that
has executed a Guaranty) within 30 days after such Person
becomes a Restricted Subsidiary (limited to 65% of the
outstanding capital stock, partnership interests, or other
ownership interests in such Person if such Person is a Foreign
Restricted Subsidiary), or (ii) to promptly execute and
deliver or register, file or record such other documents and
instruments as Collateral Agent may reasonably request to
grant, create, preserve, perfect and maintain, as first, prior
and perfected Liens, the Liens created, or intended to be
created, by such Pledge Agreement, subject to Permitted Liens,
provided, however, the foregoing shall not apply to the extent
that any such Pledge Agreement is prohibited or would subject
Borrower or any Restricted Subsidiary to adverse income tax
consequences or substantial stamp or similar taxes (A) under
Section 956 of the Code or applicable stamp or similar tax
laws, (B) by contractual restrictions in existence prior to
the Effective Date, in the case of a Person that is a
Restricted Subsidiary on the Effective Date, or by contractual
restrictions in existence prior to the date such Person shall
become a Restricted Subsidiary, in the case of a Person that
becomes a Restricted Subsidiary after the Effective Date or
(C) as a matter of corporate, partnership or limited liability
company law.
Upon the occurrence of an Event of Default described in Section 6.1(h)(1), (2)
or (3) with respect to Borrower, the Commitments shall automatically terminate
and all of the Obligations shall thereupon be immediately due and payable,
without demand, presentment, notice of demand or of dishonor and nonpayment,
protest, notice of protest, notice of intention to accelerate, declaration or
notice of acceleration, or any other notice or declaration of any kind, all of
which are hereby expressly waived by Borrower and each Designated Entity who at
any time ratifies, approves or guarantees this Agreement. During the continuance
of any other Event of Default, Administrative Agent at any time and from time to
time upon written instructions from Required Lenders shall, by notice to
Borrower (but otherwise without notice to any other Designated Entity), declare
the Commitments to be terminated, and/or declare any or all of the Obligations
immediately due and payable, and all such Obligations shall thereupon be
immediately due and payable, without demand, presentment, notice of demand or of
dishonor and nonpayment, protest, notice of protest, notice of intention to
accelerate, declaration or notice of acceleration, or any other notice or
declaration of any kind, all of which are hereby expressly waived by Borrower
and each Designated Entity who at any time ratifies, approves or guarantees this
Agreement and/or require Borrower to deposit Cash Collateral with Administrative
Agent in an amount determined in accordance with paragraph (c) of Section 2.14.
Section 6.2 Remedies. If any Default shall occur and be continuing,
Required Lenders or Administrative Agent, at the direction of Required Lenders,
may proceed (or direct Collateral Agent to proceed) to protect and enforce
Lenders' and Agents' rights under the Loan Documents by any appropriate
proceedings, including, without limitation, proceedings for specific performance
of any covenant or agreement contained in any Loan Document. All rights,
remedies and powers conferred upon Administrative Agent, Collateral Agent and
Lenders under the Loan Documents are cumulative and not exclusive of any other
rights, remedies or powers available under the Loan Documents or at law or in
equity.
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Section 6.3 Annulment of Acceleration. If a declaration of acceleration
is made pursuant to this Article 6, then Required Lenders, by written notice to
Borrower and Administrative Agent, may collectively rescind and annul such
declaration in its entirety; provided, that at the time such declaration is
annulled and rescinded: (a) no judgment or decree has been entered for the
payment of any moneys due pursuant to any Loan Document; (b) all arrears of
interest and all other sums payable under the Loan Documents (other than
principal amounts which may have become due as a result of acceleration),
including interest upon overdue interest, to the extent payment thereof is
lawful, shall have been duly paid; and (c) each and every other Event of Default
which has theretofore occurred shall have been waived pursuant to Section 8.1 or
otherwise made good or cured.
Section 6.4 Indemnity. Borrower hereby indemnifies each Agent and each
Lender from and against any and all liabilities, obligations, claims, losses,
damages, penalties, actions, judgments, suits, 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 Agent or such Lender as a result of,
arising out of, relating to or in connection with:
(a) the Loan Documents to which Borrower or one or more of its
Subsidiaries is a party or the rights provided therein
(including the enforcement or defense thereof);
(b) the direct or indirect application or proposed application of
the proceeds of any Advance or Letter of Credit to or for
Borrower or any of its Subsidiaries;
(c) any transaction financed or to be financed in whole or in
part, directly or indirectly, with the proceeds of any Advance
or Letter of Credit to or for Borrower or any of its
Subsidiaries;
(d) any investigation, litigation or proceeding related to any
environmental cleanup, audit, compliance or other matter
(including enforcement) relating to any Environmental Law or
the condition of any facility or property owned, leased or
operated by Borrower or any of its Subsidiaries; or
(e) the presence on or under, or the escape, seepage, leakage,
spillage, discharge, emission, discharging or releases from,
any facility owned or operated by Borrower or any of its
Subsidiaries of any hazardous or toxic substance (including
any liabilities and costs under any Environmental Law),
regardless of whether caused by, or within the control of,
Borrower or any of its Subsidiaries; or any misrepresentation,
inaccuracy or any breach in or of Section 4.1(j) or Section
5.1(i) by or with respect to Borrower or any of its
Subsidiaries.
The foregoing indemnification shall not apply to the extent such liabilities and
costs are determined to have resulted or been caused, in whole or in part, by
the gross negligence or willful misconduct on the part of such Agent or Lender.
THE FOREGOING INDEMNIFICATION SHALL APPLY WHETHER OR NOT SUCH LIABILITIES AND
COSTS ARE IN ANY WAY OR TO ANY EXTENT CAUSED, IN WHOLE OR IN PART, BY ANY
NEGLIGENT ACT OR OMISSION OF ANY KIND EXCEPT AS PROVIDED BY THE IMMEDIATELY
PRECEDING SENTENCE. In the event that any claim or demand for which Borrower
would be liable to any Agent or any Lender under this section is asserted
against or sought to be collected from any Agent or any Lender by a third party,
such Agent or such Lender shall promptly notify Borrower of such claim or
demand. Borrower shall have the lesser of: (i) thirty (30) Business Days from
receipt of the above notice; or (ii) three (3) Business Days prior to the
48
expiration of any period after which a default judgment may be entered against
such Agent or Lender (the "Notice Period") to notify such Agent and/or Lender
whether or not Borrower desires, at the sole cost and expense of Borrower, to
defend such Agent and/or Lender against such claim or demand. In the event that
Borrower notifies such Agent and/or Lender within the Notice Period, that it
desires to defend such Agent and/or Lender against such claim or demand,
Borrower shall have the right to settle or otherwise dispose of such claim or
demand (other than claims alleging criminal violations) on such terms as
Borrower, with the consent of the indemnified party (which consent shall not be
unreasonably withheld) shall deem appropriate; provided that
(w) counsel designated by Borrower is reasonably acceptable to
Administrative Agent and the affected Lender;
(x) Borrower will have acknowledged in writing that this section
will cover any liabilities and costs in any such claim or
demand;
(y) in the sole determination of Administrative Agent and the
affected Lender, Borrower will have the financial ability to
pay such liabilities and costs; and
(z) Borrower shall thereafter consult with Administrative Agent
and the affected Lender with respect to such claim or demand;
and
provided further, that each of Administrative Agent and the affected Lender
shall have the right at all times to participate in any proceeding, at their
sole cost and expense, subject, however, to Borrower's right to control the
defense of all proceedings concerning such claim or demand.
In the event that Borrower fails to give such Agent and/or Lender such notice,
such Agent and/or Lender may defend against such claim or demand; provided,
however, that Borrower's obligation to reimburse such Agent and/or Lender shall
be limited to a single law firm of such Agent and/or Lender (unless Borrower
otherwise consents, which consent shall not be unreasonably withheld); provided
further, that Borrower shall have the right at all times to participate in any
such proceeding, at its sole cost and expense, subject, however, to the right of
such Agent and/or Lender to control the defense of all proceedings concerning
such claim or demand. As used in this section, the terms "Administrative Agent"
and "Lender" shall refer not only to the Persons designated as such in Section
1.1 but also to each director, officer, agent, attorney, employee and
representative of such Person.
ARTICLE 7
AGENTS
Section 7.1 Appointment and Authority. Bank of America, N.A. is hereby
appointed Administrative Agent hereunder and under each other Loan Document and
as Collateral Agent under the Pledge Agreements. Credit Suisse First Boston is
hereby appointed Documentation Agent hereunder and under each other Loan
Document. The Chase Manhattan Bank is hereby appointed Syndication Agent
hereunder and under each other Loan Document. Lenders hereby authorizes each
such Agent to act as the agent of such Lender hereunder and each other Loan
Document to the extent provided herein or therein. In addition, each Lender
hereby irrevocably authorizes Administrative Agent, and Administrative Agent
hereby undertakes, to receive payments of principal, interest and other amounts
due hereunder as specified herein. In addition, each Lender hereby authorizes
Administrative Agent and Collateral Agent, and Administrative Agent and
49
Collateral Agent hereby undertakes, to take all other actions and to exercise
such powers under the Loan Documents as are specifically delegated to it by the
terms hereof or thereof, together with all other powers reasonably incidental
thereto. Neither Documentation Agent nor Syndication Agent has any duties or
responsibilities whatsoever under or in connection with this Agreement or any of
the other Loan Documents except as expressly set forth herein. The relationship
of each Agent to Lenders is only that of one commercial bank acting as agent for
others, and nothing in the Loan Documents shall be construed to constitute any
Agent a trustee or other fiduciary for any holder of any of the Obligations, nor
to impose on any Agent duties and obligations other than those expressly
provided for in the Loan Documents. None of the Agents shall have implied duties
to Lenders, or any obligations to Lenders to take any action under the Loan
Documents, except any action by an Agent specifically required by the Loan
Documents to be taken by such Agent. With respect to any matters not expressly
provided for in the Loan Documents and any matters which the Loan Documents
place within the discretion of any Agent, such Agent shall not be required to
exercise any discretion or take any action, and each such Agent may request
instructions from Lenders with respect to any such matter, in which case such
Agent shall be required to act or to refrain from acting (and shall be fully
protected and free from liability to any and all Lenders and Agents in so acting
or refraining from acting) upon the instructions of Required Lenders (including
itself) or all Lenders (in the circumstances provided in Section 8.1); provided,
however, that no Agent shall be required to take any action which exposes it to
a risk of personal liability that it considers unreasonable or which is contrary
to the Loan Documents or to applicable law unless indemnified to its
satisfaction by Lenders or Borrower. Upon receipt by Administrative Agent from
Borrower of any communication calling for action on the part of Lenders or upon
notice from any Lender to Administrative Agent of any Default or Event of
Default, Administrative Agent shall promptly notify each Lender thereof.
Section 7.2 Agents' Reliance. No Agent or any of its directors,
officers, agents, attorneys, or employees shall be liable for any action taken
or omitted to be taken by any of them under or in connection with the Loan
Documents, including their negligence of any kind, except that each shall be
liable for its own gross negligence or willful misconduct. Without limiting the
generality of the foregoing, each Agent:
(a) may treat the payee of any Note as the holder thereof until
Administrative Agent receives written notice of the assignment
or transfer thereof in accordance with this Agreement, signed
by such payee and in form satisfactory to Administrative
Agent;
(b) may consult with legal counsel (including counsel for
Borrower), independent public accountants and other experts
selected by such Agent and shall not be liable for any action
taken or omitted to be taken in good faith by it in accordance
with the advice of such counsel, accountants or experts;
(c) makes no warranty or representation to any Lender or any other
Agent and shall not be responsible to any Lender or any other
Agent for any statements, warranties or representations made
in or in connection with the Loan Documents by any other
Person;
(d) shall not have any duty to ascertain or to inquire as to the
performance or observance of any of the terms, covenants or
conditions of the Loan Documents on the part of any Designated
Entity or to inspect the property (including the books and
records) of any Designated Entity;
(e) shall not be responsible to any Lender or any other Agent for
the due execution (other than its own due execution and
delivery), legality, validity, enforceability, genuineness,
50
existence, sufficiency or value of any Loan Document or any
instrument or document furnished in connection herewith, or
any collateral;
(f) may rely upon the representations and warranties of any
Designated Entity and the Lenders in exercising its powers
hereunder;
(g) shall not be responsible for the satisfaction of any condition
specified in Article 3, except receipt by such Agent of items
required to be delivered to such Agent; and
(h) shall incur no liability under or in respect of the Loan
Documents by acting upon any notice, consent, certificate or
other instrument or writing (including any telecopy, telegram,
cable or telex) believed by it to be genuine and signed or
sent by the proper Person or Persons.
Section 7.3 Lenders' Credit Decisions. Each Lender acknowledges that it
has, independently and without reliance upon any Agent or any other Lender, made
its own analysis of the Designated Entities and the transactions contemplated
hereby and its own independent decision to enter into this Agreement and the
other Loan Documents. Each Lender also acknowledges that it will, independently
and without reliance upon any Agent or any other Lender 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
Documents.
Section 7.4 Indemnification. Each Lender agrees to indemnify each Agent
(to the extent not reimbursed by Borrower within ten (10) days after demand)
from and against such Lender's Percentage Share of any and all liabilities,
obligations, claims, losses, damages, penalties, actions, judgments, suits,
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 Agent
growing out of, resulting from or in any other way associated with any of the
Loan Documents and the transactions and events (including, without rotation, the
enforcement thereof) at any time associated therewith or contemplated therein.
THE FOREGOING INDEMNIFICATION SHALL APPLY WHETHER OR NOT SUCH LIABILITIES AND
COSTS ARE IN ANY WAY OR TO ANY EXTENT CAUSED, IN WHOLE OR IN PART, BY ANY
NEGLIGENT ACT OR OMISSION OF ANY KIND BY ANY AGENT, PROVIDED ONLY THAT NO LENDER
SHALL BE OBLIGATED UNDER THIS SECTION TO INDEMNIFY AN AGENT FOR THAT PORTION, IF
ANY, OF ANY LIABILITIES AND COSTS WHICH IS THE SOLE RESULT OF SUCH AGENT'S OWN
INDIVIDUAL GROSS NEGLIGENCE OR WILLFUL MISCONDUCT, AS DETERMINED IN A FINAL
JUDGMENT OF A COURT OF COMPETENT JURISDICTION. Cumulative of the foregoing, each
Lender agrees to reimburse each Agent promptly upon demand for such Lender's
Percentage Share of any costs and expenses required to be paid to such Agent by
Borrower under Section 5.1(h) to the extent that such Agent is not timely
reimbursed for such costs and expenses by Borrower as provided in such section.
As used in this section the term "Agents" shall refer not only to the Person(s)
designated as such in Section 1.1 but also to each director, officer, agent,
attorney, employee and representative of such Person(s).
Section 7.5 Rights as Lender. In their respective capacity as a Lender,
each Agent shall have the same rights and obligations as any Lender and may
exercise such rights as though it were not an Agent. Each Agent and its
Affiliates may accept deposits from, lend money to, act as trustee under
indentures of, and generally engage in any kind of business with any of
Designated Entities or their Affiliates, all as if it were not an Agent
hereunder and without any duty to account therefor to any other Lender.
51
Section 7.6 Sharing of Set-Offs and Other Payments. Each Agent and
Lender agrees that if it shall, whether through the exercise of rights under
security documents or rights of banker's lien, setoff, or counterclaim against
any Designated Entity or otherwise, obtain payment of a portion of the aggregate
Obligations owed to it (other than in respect of its Swing Line Advances) which,
taking into account all distributions made by Administrative Agent under Section
2.11, causes such Agent or such Lender to have received more than it would have
received had such payment been received by Administrative Agent and distributed
pursuant to Section 2.11 (or, in the case of Swing Line Advances paid as
provided in Section 2.5(c)), then it shall be deemed to have simultaneously
purchased and shall be obligated to purchase interests in the Obligations as
necessary to cause Agents and all Lenders to share all payments (other than in
respect of Swing Line Advances) as provided for in Section 2.11, and such other
adjustments shall be made from time to time as shall be equitable to ensure that
all Agents and all Lenders share all payments of Obligations (other than in
respect of Swing Line Advances) as provided in Section 2.11. If any Agent or any
Lender, whether in connection with setoff of amounts which might be subject to
setoff or otherwise, receives collateral or other protection for its Obligations
or such amounts which might be subject to setoff, such Agent or Lender agrees,
promptly upon demand, to take such action necessary so that all Agents and all
Lenders share in the benefits of such collateral ratably in proportion to the
Obligations owing to each of them. Nothing herein contained shall in any way
affect the right of any Agent or any Lender to obtain payment (whether by
exercise of rights of banker's lien, set-off or counterclaim or otherwise) of
indebtedness other than the Obligations. Borrower expressly consents to the
foregoing arrangements and agrees that any holder of any such interest or other
participation in the Obligations, whether or not acquired pursuant to the
foregoing arrangements, may to the fullest extent permitted by law exercise any
and all rights of banker's lien, set-off, or counterclaim as fully as if such
holder were a holder of the Obligations in the amount of such interest or other
participation. If all or any part of any funds transferred pursuant to this
section is thereafter recovered from the seller under this section which
received the same, the purchase provided for in this section shall be deemed to
have been rescinded to the extent of such recovery, together with interest, if
any, if interest is required pursuant to court order to be paid on account of
the possession of such funds prior to such recovery.
Section 7.7 Investments. Whenever Administrative Agent in good faith
determines that it is uncertain about how to distribute to Lenders any funds
which it has received, or whenever Administrative Agent in good faith determines
that there is any dispute among Lenders about how such funds should be
distributed, Administrative Agent may choose to defer distribution of the funds
which are the subject of such uncertainty or dispute. If Administrative Agent in
good faith believes that the uncertainty or dispute will not be promptly
resolved, or if Administrative Agent is otherwise required to invest funds
pending distribution to Lenders, Administrative Agent may invest such funds
pending distribution (at the risk of Borrower); all interest on any such
investment shall be distributed upon the distribution of such investment and in
the same proportion and to the same Persons as such investment. All moneys
received by Administrative Agent for distribution to Lenders (other than to the
Person who is Administrative Agent in its separate capacity as a Lender) shall
be held by Administrative Agent pending such distribution solely as
Administrative Agent for such Lenders, and Administrative Agent shall have no
equitable title to any portion thereof.
Section 7.8 Benefit of Article 7. The provisions of this Article (other
than the following Section 7.9) are intended solely for the benefit of Agents
and Lenders, and no Designated Entity shall be entitled to rely on any such
provision or assert any such provision in a claim or defense against any Agent
or Lender. Agents and Lenders may waive or amend such provisions as they desire
without any notice to or consent of any Designated Entity.
52
Section 7.9 Resignation and Removal. Any Agent may resign at any time
by giving written notice thereof to Lenders and Borrower. Each such notice shall
set forth the date of such resignation. Required Lenders or Borrower, with the
consent (which shall not be unreasonably withheld) of Required Lenders (other
than any Agent to be removed) shall be entitled to remove any Agent. Upon any
such resignation or removal, Borrower may, with the written concurrence (which
shall not be unreasonably withheld) of Required Lenders (exclusive of any such
resigned or removed Agent), designate a successor Agent. If, within fifteen (15)
days after the date of such resignation or removal, Borrower makes no such
designation or such written concurrence is not given, Required Lenders
(exclusive of any such resigned or removed Agent) shall, with the consent of
Borrower (which consent shall not be unreasonably withheld or delayed), have the
right to appoint a successor Agent. After any Agent's resignation or removal
hereunder, the provisions of this Article 7 shall continue to inure to its
benefit as to any actions taken or omitted to be taken by it while it was Agent
under the Loan Documents. Any out-going Agent shall promptly execute all
assignments and other documents necessary to effectuate the transfer of the
agency in connection with this Agreement and shall promptly deliver all original
documents and any collateral in its possession to the successor Agent.
ARTICLE 8
MISCELLANEOUS
Section 8.1 Waivers and Amendments. No failure or delay (whether by
course of conduct or otherwise) by any Agent or any Lender in exercising any
right, power or remedy which any Agent or Lender may have under any of the Loan
Documents shall operate as a waiver thereof or of any other right, power or
remedy, nor shall any single or partial exercise by any Agent or Lender 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
Document and no consent to any departure therefrom shall ever be effective
unless it is in writing and signed as provided below in this section, 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 any Designated Entity shall in any case of itself entitle
any Designated Entity to any other or further notice or demand in similar or
other circumstances. This Agreement and the other Loan Documents set forth the
entire understanding between the parties hereto 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
waiver, consent, release, modification or amendment of or supplement to this
Agreement or the other Loan Documents shall be valid or effective against any
party hereto unless the same is in writing and signed by (a) if such party is a
Designated Entity, by such Designated Entity, (b) if such party is an Agent, by
such Agent and (c) if such party is a Lender, by Required Lenders, or by
Administrative Agent on behalf of Lenders with the prior written consent of
Required Lenders (or without further consent than that already provided herein
in the circumstances provided in Section 8.7). Notwithstanding the foregoing or
anything to the contrary herein or in any other Loan Document, no waiver,
consent, release, modification or amendment of or supplement to this Agreement
or any other Loan Document which would:
(i) increase the Commitment of any Lender or subject any Lender to
any additional obligations;
(ii) reduce or forgive any fees hereunder, or the principal of, or
interest on, any Lender's Advances or participation in Swing
Line Advances or LC Obligations;
53
(iii) postpone any date fixed for any payment of any fees hereunder,
or principal of, or interest on, any Lender's Advances or
participation in Swing Line Advances or LC Obligations;
(iv) amend the definitions herein of "Required Lenders" or
otherwise change the aggregate amount of Percentage Shares
which is required for Administrative Agent, any other Agent,
Lenders or any of them to take any particular action under the
Loan Documents;
(v) release any Restricted Subsidiary from its Guaranty (except
upon the Restricted Subsidiary becoming an Unrestricted
Subsidiary as specified in this Agreement) or release all or
substantially all of the collateral (except as contemplated by
this Agreement);
(vi) amend this Section 8.1;
(vii) extend the Commitment Period;
(ix) amend, modify or waive any provision applicable to the
indemnification of any Lender;
(x) consent to the assignment or transfer by any Designated Entity
of any of its rights or obligations under this Agreement or
the other Loan Documents; or
(xi) amend, modify or waive the rights and obligations of Issuing
Bank or Agents; provided, that no obligation to any Designated
Entity of any Lender or Issuing Bank or any Agent may be
amended, modified or waived without the written approval of
Borrower, which approval shall not be unreasonably withheld;
shall be valid or effective, in each case, without the prior written consent of
each Lender affected thereby.
Notwithstanding the foregoing or anything to the contrary herein or in any other
Loan Document, no provision hereof may be amended or waived which impacts or
affects Swing Line Lender without its prior written consent and no provision
hereof may be amended or waived which impacts or affects Issuing Bank without
its prior written consent.
Section 8.2 Survival of Agreements, Cumulative Nature. Each Designated
Entity's various representations, warranties, covenants, indemnities and
agreements in the Loan Documents shall survive the execution and delivery of
this Agreement and the other Loan Documents and the performance hereof and
thereof, including the making or granting of the Loans, the issuance of the
Letters of Credit and the delivery of the Notes, and the other Loan Documents,
and shall further survive until all of the Obligations are paid in full to
Agents and Lenders, all Letters of Credit have expired or been canceled and all
of Agents' and Lenders' obligations to Borrower are terminated, provided that,
notwithstanding the foregoing, certain Obligations of certain Designated
Entities under their respective Guaranties shall survive or be reinstated as
provided in such Guaranties. The representations, warranties, indemnities, and
covenants made by any Designated Entity in any Loan Documents, and the rights,
powers, and privileges granted to Agents and Lenders in the Loan Documents, are
cumulative.
Section 8.3 Notices. All notices, requests, consents, demands and other
communications required or permitted under any Loan Document shall be in
writing, unless otherwise specifically provided in such Loan Document (provided
that Administrative Agent may give telephonic notices to the other Agents and
54
Lenders), and shall be deemed sufficiently given or furnished if delivered by
personal delivery, by telecopy (with telephonic confirmation of transmission),
by delivery service with proof of delivery, or by registered or certified United
States mail, postage prepaid, to Borrower at the address of Borrower specified
on the signature pages hereto and to each Agent and each Lender at their
addresses specified on the signature pages hereto (unless changed by similar
notice in writing given by the particular Person whose address is to be
changed). Any such notice or communication shall be deemed to have been given:
(a) in the case of personal delivery or delivery service, as of
the date of first attempted delivery during normal business
hours at the address provided herein;
(b) in the case of telecopy, upon receipt; or
(c) in the case of registered or certified United States mail,
three 3) days after deposit in the mail, postage prepaid;
provided, however, that no Request for Revolving Loan Advance
or Rate Election shall become effective until actually
received by Administrative Agent and no request for the
issuance of a Letter of Credit or Letter of Credit Application
shall become effective until actually received by Issuing
Bank.
Section 8.4 Parties in Interest. All grants, covenants and agreements
contained in the Loan Documents shall bind and inure to the benefit of the
parties thereto and their respective successors and assigns; provided, however,
that no Designated Entity may assign or transfer any of its rights or delegate
any of its duties or obligations under any Loan Document without the prior
written consent of all Lenders.
Section 8.5 Governing Law. THE LOAN DOCUMENTS SHALL BE DEEMED CONTRACTS
AND INSTRUMENTS MADE UNDER THE LAWS OF THE STATE OF TEXAS AND SHALL BE CONSTRUED
AND ENFORCED IN ACCORDANCE WITH AND GOVERNED BY THE LAWS OF THE STATE OF TEXAS
AND THE LAWS OF THE UNITED STATES OF AMERICA, WITHOUT REGARD TO PRINCIPLES OF
CONFLICTS OF LAW. CHAPTER 346 OF THE TEXAS FINANCE CODE (WHICH REGULATES CERTAIN
REVOLVING CREDIT LOAN ACCOUNTS AND REVOLVING TRI- PARTY ACCOUNTS) DOES NOT APPLY
TO THIS AGREEMENT OR TO ANY NOTES.
Section 8.6 Limitation on Interest. It is the intention of the parties
hereto to conform strictly to applicable usury laws and, anything herein or any
other Loan Document to the contrary notwithstanding, the obligations of
Designated Entities to a Lender or an Agent under this Agreement and the Loan
Documents shall be subject to the limitation that payments of interest shall not
be required to the extent that receipt thereof would be contrary to provisions
of law applicable to such Lender or Agent limiting rates of interest which may
be charged or collected by such Lender or Agent. Accordingly, if the
transactions contemplated hereby would be usurious under laws applicable to a
Lender or Agent (including the federal and state laws of the United States of
America or of any other jurisdiction whose laws may be mandatorily applicable to
such Lender or Agent notwithstanding anything to the contrary in this Agreement
or any other Loan Document) then, in that event, notwithstanding anything to the
contrary in this Agreement or any other Loan Document, it is agreed as follows:
(a) the provisions of this section shall govern and control;
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(b) the aggregate of all consideration which constitutes interest
under applicable law that is contracted for, taken, reserved,
charged or received under this Agreement, or under any of the
aforesaid agreements or otherwise in connection with this
Agreement or any other Loan Document by such Lender or Agent
shall under no circumstances exceed the maximum amount of
interest allowed by applicable law (such maximum lawful
interest rate, if any, with respect to each Lender and each
Agent herein called the "Maximum Lawful Rate"), and any excess
shall be canceled automatically and if theretofore paid shall
be credited to the relevant Designated Entity by such Lender
or Agent (or, if such consideration shall have been paid in
full, such excess refunded to the relevant Designated Entity);
(c) all sums paid, or agreed to be paid, to such Lender or Agent
for the use, forbearance and detention of the indebtedness of
the relevant Designated Entity to such Lender or Agent
hereunder or under any other Loan Document shall, to the
extent permitted by laws applicable to such Lender or Agent,
as the case may be, be amortized, prorated, allocated and
spread throughout the full term of such indebtedness until
payment in fall so that the actual rate of interest is uniform
throughout the full term thereof;
(d) if at any time the interest provided pursuant to any provision
of this Agreement or any other Loan Document, together with
any other fees payable pursuant to this Agreement or any other
Loan Document and deemed interest under laws applicable to
such Lender or Agent, exceeds the amount which would have
accrued at the Maximum Lawful Rate, the amount of interest and
any such fees to accrue to such Lender or Agent pursuant to
this Agreement or any other Loan Document shall be limited,
notwithstanding anything to the contrary in this Agreement or
any other Loan Document, to that amount which would have
accrued at the Maximum Lawful Rate, but any subsequent
reductions, as applicable, shall not reduce the interest to
accrue to such Lender or Agent pursuant to this Agreement or
any other Loan Document below the Maximum Lawful Rate until
the total amount of interest accrued pursuant to this
Agreement or such other Loan Document, as the case may be, and
such fees deemed to be interest equals the amount of interest
which would have accrued to such Lender or Agent if a varying
rate of interest per annum equal to the interest provided
pursuant to Section 2.3 or any other relevant section hereof
(other than this section) and any Note, as applicable, had at
all times been in effect, plus the amount of fees which would
have been received but for the effect of this section; and
(e) if the total amount of interest paid by or accrued with
respect to the Obligations of Borrower, together with any
other fees payable pursuant to this Agreement and the other
Loan Documents and deemed interest under laws applicable to
such Lender or Agent pursuant to this Agreement or any other
Loan Document under the foregoing provisions of this section
is less than the total amount of interest which would have
accrued if a varying rate per annum equal to the interest
provided pursuant to Section 2.3 or any other relevant section
hereof (other than this section), as applicable, had at all
times been in effect and all fees provided for in this
Agreement and the other Loan Documents had been paid, then
Borrower severally agrees to pay to such Lender or Agent an
amount equal to the difference between, (i) the lesser of (x)
the amount of interest and fees which would have accrued if
the Maximum Lawful Rate had at all times been in effect, and
(y) the amount of interest and fees which would have accrued
if a varying rate per annum equal to the interest provided
pursuant to Section 2.3 or such other relevant section of this
Agreement (other than this section) and any Note, as
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applicable, had at all times been in effect and all fees had
been paid, and (ii) the amount of interest and fees accrued in
accordance with the other provisions of this Agreement and
other Loan Documents.
For purposes of Chapter 303 of the Texas Finance Code, to the extent
applicable to any Lender or Agent, Borrower and each other Designated Entity
agrees that the Maximum Lawful Rate shall be the "weekly ceiling" as defined in
said Chapter, provided that such Lender or Agent, as applicable, may also rely,
to the extent permitted by applicable laws of the State of Texas and the United
States of America, on alternative maximum rates of interest under the Texas
Finance Code or other laws applicable to such Lender or Agent from time to time
if greater.
Section 8.7 Termination: Limited Survival. In its sole and absolute
discretion, Borrower may, at any time that no Obligations or other amounts are
owing and no Letters of Credit are outstanding, elect to terminate this
Agreement in a written notice delivered to Administrative Agent. Upon receipt by
Administrative Agent of such a notice, if no Obligations or other amounts are
then owing and no Letters of Credit are outstanding, this Agreement and all
other Loan Documents shall thereupon be terminated and the parties thereto
released from all prospective obligations hereunder or thereunder.
Notwithstanding the foregoing or anything herein to the contrary, any waivers or
admissions made by any Designated Entity in any Loan Document, any Obligations
under Sections 2.16 through 2.20, any obligations which any Designated Entity
may have to indemnify or compensate any Agent, any Issuing Bank, or any Lender
in connection with matters arising upon or prior to the termination of this
Agreement and any obligations which any Lender may have to indemnify or
compensate any Agent or Issuing Bank in connection with matters arising upon or
prior to the termination of this Agreement shall survive any termination of this
Agreement or any other Loan Document and the release of Designated Entities. At
the request and expense of Borrower, Administrative Agent or Collateral Agent,
as applicable, shall prepare and execute all necessary instruments to reflect
and effect such termination of the Loan Documents including, without limitation,
the Guaranties and the Pledge Agreements. Administrative Agent or Collateral
Agent, as applicable, is hereby authorized to execute all such instruments on
behalf of all Lenders, without the joinder of or farther action or consent by
any Lender.
Section 8.8 Assignments, Participations.
(a) Each Lender shall have the right to sell, assign or transfer
all or any part of such Lender's Notes, Advances, Commitment,
LC Obligations and Swing Line Obligations hereunder to one or
more Affiliates, Lenders, financial institutions, pension
plans, investment funds, or similar Persons or to a Federal
Reserve Bank; provided, that each such sale, assignment, or
transfer (other than to an Affiliate, a Lender or a Federal
Reserve Bank) shall be with the consent of Borrower (unless an
Event of Default has occurred and is continuing), which
consent will not be unreasonably withheld, and with the
consent of Administrative Agent, which consent will not be
unreasonably withheld, and the assignee, transferee or
recipient shall have, to the extent of such sale, assignment,
or transfer, the same rights, benefits and obligations as it
would if it were such Lender and a holder of such Notes,
Advances, Commitment, LC Obligations and Swing Line
Obligations, including, without limitation, the right to vote
on decisions requiring consent or approval of all Lenders or
Required Lenders and the obligation to fund its Advances;
provided further, that (1) each Lender in making each such
sale, assignment, or transfer must sell, assign or transfer a
pro rata portion of its Commitment and each Advance (other
than a Swing Line Advance), LC Obligation and Swing Line
Obligation made or held by such Lender, (2) each such sale,
assignment, or transfer (other than to an Affiliate, a Lender
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or a Federal Reserve Bank) shall be in an aggregate principal
amount not less than $10,000,000, (3) unless such sale,
assignment or transfer results in a Lender's Commitment being
reduced to zero, each Lender shall at all times maintain a
Commitment then outstanding in an aggregate principal amount
at least equal to $10,000,000; (4) no Lender may offer to sell
its Notes, Commitment, LC Obligations, Swing Line Obligations
or Advances or interests therein in violation of any
securities laws; and (5) no such assignment (other than to a
Federal Reserve Bank) shall become effective until the
assigning Lender delivers to Administrative Agent and Borrower
copies of all written assignments and other documents
evidencing any such assignment and an Agreement to be Bound in
the form of Exhibit K, providing for the assignee's
ratification and agreement to be bound by the terms of this
Agreement and the other Loan Documents. An assignment fee in
the amount of $3,500 for each such assignment will be payable
to Administrative Agent by the assignor or assignee. Within
five (5) Business Days after its receipt of copies of any
assignment and the other documents relating thereto and any
Note of the assignor, Borrower shall, if requested by the
assignor or assignee, execute and deliver to Administrative
Agent (for delivery to the assignor or assignee, as
applicable) new Notes evidencing such assignee's assigned
Advances and Commitment and if the assignor Lender has
retained a portion of its Advances and Commitment, replacement
Notes in the principal amount of the Advances and Commitment
retained by the assignor Lender. On and after the effective
date of an assignment hereunder, the assignee shall for all
purposes be a Lender party to this Agreement and any other
Loan Document executed by Lenders and shall have all the
rights and obligations of a Lender under the Loan Documents,
to the same extent as if it were an original party thereto,
and no further consent or action by Borrower, Lenders or any
Agent shall be required to release the transferor Lender, with
respect to the Commitment, the LC Obligations, the Swing Line
Obligations and the Advances assigned to such assignee and the
transferor Lender shall henceforth be so released.
(b) Each Lender shall have the right to grant participations in
all or any part of such Lender's Notes, Commitment, LC
Obligations, Swing Line Obligations and Advances hereunder to
one or more pension plans, investment funds, financial
institutions or other Persons; provided, that:
(1) each Lender granting a participation shall retain the
right to vote hereunder, and no participant shall be
entitled to vote hereunder on decisions requiring
consent or approval of Lenders or Required Lenders
(except as set forth in (3) below);
(2) in the event any Lender grants a participation
hereunder, such Lender's obligations under the Loan
Documents shall remain unchanged, such Lender shall
remain solely responsible to the other parties hereto
for the performance of such obligations, such Lender
shall remain the holder of any such Notes for all
purposes under the Loan Documents, and each Agent,
each Lender and Borrower shall be entitled to deal
with the Lender granting a participation in the same
manner as if no participation had been granted; and
(3) no participant shall ever have any right by reason of
its participation to exercise any of the rights of
Lenders hereunder (other than Section 8.15 hereof),
except that any Lender may agree with any participant
that such Lender will not, without the consent of such
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participant, consent to any amendment or waiver
described in Section 8.1 requiring approval of 100% of
the Lenders.
(c) It is understood and agreed that any Lender may provide to
assignees and participants and prospective assignees and
participants financial information and reports and data
concerning Designated Entities' properties and operations
which was provided to such Lender pursuant to this Agreement,
subject to Section 8.9.
(d) Upon the reasonable request of either Administrative Agent or
Borrower, each Lender will identify those to whom it has
assigned or participated any part of its Notes, LC
Obligations, Swing Line Obligations or Advances, and provide
the amounts so assigned or participated. Administrative Agent
shall maintain, at its office, a register for the recordation
of the names and addresses of Lenders and their Commitments,
which register shall be available for inspection by Borrower
or any Lender at any reasonable time and from time to time
upon reasonable prior notice.
Section 8.9 Confidentiality. Each Agent and each Lender agrees that it
(a) will maintain the confidentiality of all non-public information from any
Designated Entity or any Subsidiary of Borrower obtained pursuant to the terms
of this Agreement or any other Loan Document in accordance with safe and sound
banking practices, and (b) will not use such confidential information for any
purpose other than in connection with this Agreement; provided, however, that
this restriction shall not apply to information which (w) has at the particular
time in question entered the public domain, or been independently developed
without the use or incorporation of any non-public information provided to such
Agent or Lender by any Designated Entity or any Subsidiary of Borrower by such
Agent or such Lender other than through disclosure by such Agent or such Lender
in violation of this section, (x) is required to be disclosed by law or by any
order, rule, regulation or legal process (whether valid or invalid) of any court
or Governmental Authority, (y) is furnished to any other Lender or to any
purchaser or prospective purchaser of participations, assignments or other
interests in any Advance, Note, LC Obligation, Swing Line Obligation or
Commitment that has executed and delivered to Borrower an agreement containing
terms substantially similar to this section and reasonably acceptable to
Borrower, to keep such information confidential or (z) is disclosed to such
Lender's or Agent's examiners, Affiliates, outside auditors, counsel and other
professional advisors who have a need for such information in connection with
this Agreement and who are advised of the confidential nature of such
information. As used in this section, the terms "Agent" and "Lender" shall refer
not only to the Persons designated as such in Section 1.1, but also to each
director, Affiliate, officer, agent, attorney, employee and representative of
such Person. Notwithstanding any other provisions of this Agreement, the terms
of this section shall survive the termination of this Agreement for a period of
three (3) years.
Section 8.10 Severability. If any term or provision of any Loan
Document shall be determined to be illegal or unenforceable in any jurisdiction,
such term or provision shall, as to such jurisdiction, be illegal or
unenforceable, without affecting the remaining provisions in that jurisdiction
or the legality or enforceability of such terms or conditions in any other
jurisdiction.
Section 8.11 Counterparts. This Agreement may be separately executed in
any number of counterparts and by different parties hereto in separate
counterparts, each of which when so executed shall be deemed to constitute one
and the same Agreement.
Section 8.12 WAIVER OF JURY TRIAL, PUNITIVE DAMAGES. EACH OF THE
BORROWER, AGENTS AND LENDERS HEREBY (I) IRREVOCABLY WAIVES, TO THE MAXIMUM
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EXTENT NOT PROHIBITED BY LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN
RESPECT OF ANY LITIGATION DIRECTLY OR INDIRECTLY AT ANY TIME ARISING OUT OF,
UNDER OR IN CONNECTION WITH THE LOAN DOCUMENTS OR ANY TRANSACTION CONTEMPLATED
THEREBY OR ASSOCIATED THEREWITH, BEFORE OR AFTER MATURITY; (II) IRREVOCABLY
WAIVES, TO THE MAXIMUM EXTENT NOT PROHIBITED BY LAW, ANY RIGHT IT MAY HAVE TO
CLAIM OR RECOVER IN ANY SUCH LITIGATION ANY EXEMPLARY, PUNITIVE OR CONSEQUENTIAL
DAMAGES; (III) CERTIFIES 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 (IV) ACKNOWLEDGES THAT IT HAS BEEN INDUCED TO ENTER INTO
THIS AGREEMENT, THE OTHER LOAN DOCUMENTS AND THE TRANSACTIONS CONTEMPLATED
HEREBY AND THEREBY BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS
CONTAINED IN THIS SECTION.
Section 8.13 Several Obligations. The respective obligations of Lenders
hereunder are several and not joint and no Lender shall be the partner or agent
of any other (except to the extent to which an Agent is authorized to act as
such). The failure of any Lender to perform any of its obligations hereunder
shall not relieve any other Lender from any of its obligations hereunder. This
Agreement is not intended to, and shall not be construed so as to, confer any
right or benefit upon any Person other than the parties to this Agreement and
their respective successors and assigns.
Section 8.14 Nonliability of Lenders. The relationship between Borrower
on the one hand and Lenders and Agents on the other hand shall be solely that of
borrower and lender. None of the Agents nor any Lender shall have any fiduciary
responsibilities to Borrower or any of its respective Subsidiaries. None of the
Agents nor any Lender undertakes any responsibility to Borrower or any of their
respective Subsidiaries to review or inform Borrower of any matter in connection
with any phase of Borrower's or such Subsidiary's business or operations.
Section 8.15 Setoff. In addition to, and without any limitation of, any
rights of the Lenders under applicable law, if Borrower becomes insolvent,
however evidenced, or any Event of Default or Default occurs and the maturity of
the Obligations has been accelerated, any indebtedness from any Lender or any
participant under section 8.8(b) of this Agreement to Borrower (including all
account balances, whether provisional or final and whether or not collected or
available) may be offset and applied toward the payment of the Obligations owing
to such Lender, whether or not the Obligations, or any part thereof, shall then
be due and payable.
Section 8.16 Forum Selection and Consent to Jurisdiction. ANY
LITIGATION BASED HEREON, OR ARISING OUT OF, UNDER, OR IN CONNECTION WITH, THIS
AGREEMENT OR ANY OTHER LOAN DOCUMENT, OR ANY COURSE OF CONDUCT, COURSE OF
DEALING, STATEMENTS (WHETHER VERBAL OR WRITTEN) OR ACTIONS OF AGENTS, LENDERS OR
BORROWER SHALL BE BROUGHT AND MAINTAINED EXCLUSIVELY IN THE COURTS OF THE STATE
OF TEXAS OR IN THE UNITED STATES DISTRICT COURT FOR THE NORTHERN DISTRICT OF
TEXAS. BORROWER HEREBY EXPRESSLY AND IRREVOCABLY SUBMITS TO THE JURISDICTION OF
THE COURTS OF THE STATE OF TEXAS AND THE UNITED STATES DISTRICT COURT FOR THE
NORTHERN DISTRICT OF TEXAS FOR THE PURPOSE OF ANY SUCH LITIGATION AS SET FORTH
ABOVE AND IRREVOCABLY AGREES TO BE BOUND BY ANY JUDGMENT RENDERED THEREBY IN
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CONNECTION WITH SUCH LITIGATION. BORROWER FURTHER IRREVOCABLY CONSENTS TO THE
SERVICE OF PROCESS BY REGISTERED MAIL, POSTAGE PREPAID, OR BY PERSONAL SERVICE
WITHIN OR WITHOUT THE STATE OF TEXAS. BORROWER HEREBY EXPRESSLY AND IRREVOCABLY
WAIVES, TO THE FULLEST EXTENT PERMITTED BY LAW, ANY OBJECTION WHICH IT MAY HAVE
OR HEREAFTER MAY HAVE TO THE LAYING OF VENUE OF ANY SUCH LITIGATION BROUGHT IN
ANY SUCH COURT REFERRED TO ABOVE AND ANY CLAIM THAT ANY SUCH LITIGATION HAS BEEN
BROUGHT IN AN INCONVENIENT FORUM. TO THE EXTENT THAT BORROWER 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 OR OTHERWISE) WITH RESPECT TO ITSELF OR ITS
PROPERTY, BORROWER HEREBY IRREVOCABLY WAIVES SUCH IMMUNITY IN RESPECT OF ITS
OBLIGATIONS UNDER THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS.
Section 8.17 Release of Liens. Upon the date of execution and delivery
of a Guaranty by a Restricted Subsidiary, the capital stock or other ownership
interests of which has theretofore been subject to a Pledge Agreement (each such
date, a "Pledge Release Date"), the Collateral Agent shall release and
discharge, at the cost or expense of Borrower, such capital stock or other
ownership interests from the liens and security interests created by such Pledge
Agreement.
Section 8.18 Entire Agreement. THIS WRITTEN AGREEMENT AND THE OTHER
LOAN DOCUMENTS REPRESENT THE FINAL AGREEMENT BETWEEN THE PARTIES AND MAY NOT BE
CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS, OR SUBSEQUENT ORAL
AGREEMENTS OF THE PARTIES,
THERE ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN THE PARTIES,
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