Exhibit 10.34
EXECUTION COPY
AMENDMENT dated as of March 1, 2002
(this "Amendment") to the Credit Agreement dated as of
December 12, 1997, as amended and restated as of
November 17, 1998, as amended (the "Credit Agreement"),
among FREEPORT-McMoRan SULPHUR LLC, a Delaware limited
liability company (the "Borrower"); McMoRan EXPLORATION
CO., a Delaware corporation, as guarantor (in such
capacity, the "Guarantor"); the several lenders from
time to time party thereto (collectively, the
"Lenders"); JPMORGAN CHASE BANK (f/k/a The Chase
Manhattan Bank), a New York banking corporation, as
administrative agent for the Lenders (in such capacity,
the "Administrative Agent"), as documentary agent for
the Lenders (in such capacity, the "Documentary Agent")
and as collateral agent for the Lenders (in such
capacity, the "Collateral Agent"; the Administrative
Agent, the Documentary Agent and the Collateral Agent
being collectively referred to herein as the "Agents");
and HIBERNIA NATIONAL BANK, a national banking
association, as co-agent for the Lenders (the "Co-
Agent").
WHEREAS the Borrower and the Guarantor have requested
that the Lenders approve amendments to certain provisions of the
Credit Agreement;
WHEREAS the Lenders are willing, on the terms, subject
to the conditions and to the extent set forth below, to amend
such provisions; and
WHEREAS capitalized terms used and not otherwise
defined herein shall have the meanings assigned to them in the
Credit Agreement.
NOW, THEREFORE, in consideration of the premises and
the agreements, provisions and covenants herein contained and
other good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, the parties hereto
hereby agree, on the terms and subject to the conditions set
forth herein, as follows:
SECTION 1. Amendments. Effective as of the March 2002
Amendment Effective Date (as defined in Section 3 hereof), the
Credit Agreement is hereby amended as follows:
(a) The preamble is hereby amended by deleting the
figure "$60,503,403" in the last line of the second paragraph
thereof and replacing it with the figure "$58,500,000".
(b) The following definitions are added to Section
1.01 in their appropriate alphabetical position:
"Drilling JV Partner" has the meaning set forth in
the definition of "Qualifying Joint Venture Project".
"Exploration Properties" means all Hydrocarbon
Interests included in the MOXY Collateral that is not Proved
Properties.
"Hydrocarbon Interests" shall mean all rights,
titles, interests and estates now owned or hereafter
acquired by MOXY in and to oil and gas leases, oil, gas and
mineral leases, or other liquid or gaseous hydrocarbon
leases, mineral fee interests, overriding royalty and
royalty interests, net profit interests and production
payment interests, including any reserved or residual
interests of whatever nature.
"March 2002 Amendment" means the Amendment to this
Agreement dated as of March 1, 2002.
"March 2002 Amendment Effective Date" shall have
the meaning given such term in Section 3 of the March 2002
Amendment.
"Maturity Date" means the earlier of (i) the
consummation by the Borrower of the disposition of
substantially all of its sulphur transportation and
terminaling business (a "Sulphur Disposition") and (ii)
April 3, 2002; provided, however, that the date referred to
in this clause (ii) shall be extended to May 31, 2002, if,
on or prior to March 29, 2002, (a) the Sulphur Sale
Condition has been satisfied and (b) this Agreement shall
have been amended to add certain financial covenants
satisfactory to each of the Lenders in its discretion.
"MOXY Collateral" means the assets and properties
of MOXY which are subject to the Liens created pursuant to
the MOXY Security Documents.
"MOXY Collateral Requirement" means the
requirement that:
(a) On or prior to the March 2002 Amendment
Effective Date, the MOXY Security Agreement shall have
been duly executed by MOXY and shall have been
delivered to the Collateral Agent and shall be in full
force and effect on such date and each document
(including each Uniform Commercial Code financing
statement) required by law or reasonably requested by
the Administrative Agent to be filed, registered or
recorded in order to create in favor of the Collateral
Agent for the benefit of the Secured Parties a valid,
legal and perfected first-priority security interest in
and Lien on the MOXY Collateral (subject to any Lien
permitted by Section 10.16(d) and Permitted MOXY
Encumbrances) described in such agreement shall have
been delivered to the Collateral Agent;
(b) On or prior to the March 2002 Amendment
Effective Date, all outstanding equity interests in
each Subsidiary owned by MOXY shall have been pledged
pursuant to the MOXY Security Agreement (except that
MOXY shall not be required to pledge more than 65% of
the outstanding voting equity interests of any foreign
Subsidiary) and the Collateral Agent shall have
received any certificates or other instruments
representing all such equity interests, together with
undated stock powers or other instruments of transfer
with respect thereto duly endorsed in blank;
(c) On or prior to the March 2002 Amendment
Effective Date, (i) all documents and instruments,
including Uniform Commercial Code financing statements,
required by law or reasonably requested by the
Collateral Agent to be filed, registered or recorded to
create the Liens intended to be created by the MOXY
Security Documents and to perfect such Liens to the
extent required by, and with the priority required by,
the MOXY Security Documents, shall have been delivered
to the Collateral Agent for filing, registration or
recording, and (ii) the Collateral Agent shall have
received such legal opinions of special and local
counsel as the Collateral Agent or the Lenders may
reasonably request with respect to the creation and
perfection of the Liens intended to be created by the
MOXY Security Documents, in form and substance
satisfactory to the Collateral Agent and its counsel;
(d) On or prior to the March 2002 Amendment
Effective Date, (i) each MOXY Mortgage, in form and
substance satisfactory to the Lenders, relating to each
of the MOXY Mortgaged Properties shall have been duly
executed by the parties thereto and delivered to the
Collateral Agent and shall be in full force and effect,
(ii) each of such MOXY Mortgaged Properties shall not
be subject to any Lien other than Permitted MOXY
Encumbrances those permitted under Section 10.16(d),
(iii) each of such MOXY Security Documents shall have
been filed and recorded in the recording office as
specified on Schedule II to the March 2002 Amendment
and, in connection therewith, the Collateral Agent
shall have received evidence satisfactory to it of each
such filing and recordation and (iv) the Collateral
Agent shall have received new or updated title opinions
or title reports as reasonably requested by the
Collateral Agent; provided that the obligations set
forth in clauses (iii) and (iv) hereof, to the extent
unable to be satisfied prior to the March 2002
Amendment Effective Date, may be satisfied as soon as
practicable but in no event later than (i) with respect
to (x) the MOXY Mortgage filings (other than the MOXY
Mortgage filing referred to in clause (y)), 14 days
following the March 2002 Amendment Effective Date and
(y) the MOXY Mortgage filing relating to the MOXY
Mortgaged Property located in Oklahoma, 20 days
following the March 2002 Amendment Effective Date and
(ii) with respect to the title reports or title
opinions, 29 days following the March 2002 Amendment
Effective Date;
(e) On or prior to the March 2002 Amendment
Effective Date, the Administrative Agent shall have
received a copy of, or a certificate as to coverage
under, the insurance policies required by Section 5.01
and the applicable provisions of the MOXY Security
Documents, each of which shall be endorsed or otherwise
amended to include a "standard" or "New York" lender's
loss payable endorsement and to name the Collateral
Agent as additional insured, in form and substance
satisfactory to the Administrative Agent; and
(f) On or prior to the March 2002 Amendment
Effective Date, the MOXY Guarantee Agreement shall have
been duly executed by MOXY and shall be in full force
and effect on such date.
Notwithstanding the foregoing, with respect to any
assets of MOXY consisting of real property or intellectual
property, in the event that the requirements of clauses (c)
and (d) above are not satisfied by the March 2002 Amendment
Effective Date with respect to such assets, the MOXY
Collateral Requirement shall not be deemed to be unsatisfied
so long as MOXY is exercising its best efforts to satisfy
such requirements; provided that the requirements of clauses
(c) and (d) above are satisfied with respect to each such
asset by the date that is 14 days or, in the case of the
MOXY Mortgaged Property located in Oklahoma, 20 days after
the March 2002 Amendment Effective Date (except as provided
in clause (ii) of the proviso of subsection (d)).
"MOXY Guarantee Agreement" means the Guarantee
Agreement dated as of March 1, 2002 between MOXY and the
Collateral Agent for the benefit of the Secured Parties, in
the form attached as Exhibit A to the March 2002 Amendment.
"MOXY Mortgaged Property" means the real property
fee and leasehold estates listed on Schedule I to the March
2002 Amendment.
"MOXY Mortgages" means the mortgages or deeds of
trust relating to the real property fee and leasehold
estates of MOXY in form and substance satisfactory to the
Collateral Agent and its counsel.
"MOXY Perfection Certificate" means the
"Perfection Certificate", as such term is defined in the
MOXY Security Agreement.
"MOXY Reduction" means a repayment of Loans by
MOXY after the March 2002 Amendment Effective Date made with
MOXY's own funds (including proceeds from joint ventures
relating to MOXY's assets or sales or dispositions of MOXY
assets), but not directly or indirectly from funds or assets
of the Borrower, accompanied by a simultaneous permanent
reduction in the Total Commitments equal to the amount of
such repayment, and shall include any such repayment and
commitment reduction pursuant to the provisions of Section
2.07(e).
"MOXY Release Date" means the date on which all
Liens created under the MOXY Security Documents are required
to be released pursuant to Section 10.16 as a result of MOXY
Reductions having been effected in an aggregate amount of
$15,000,000 and the other conditions therein having been
satisfied.
"MOXY Security Agreement" means the Security
Agreement dated as of March 1, 2002 between MOXY and the
Collateral Agent for the benefit of the Secured Parties, in
the form attached as Exhibit B to the March 2002 Amendment.
"MOXY Security Documents" means the MOXY Security
Agreement, the MOXY Mortgages and each other agreement or
instrument executed and delivered to secure the Obligations
or MOXY's obligations under the MOXY Guarantee Agreement.
"Oil and Gas Properties" shall mean Hydrocarbon
Interests; the properties now or hereafter pooled or
unitized with Hydrocarbon Interests; all presently existing
or future unitization, pooling agreements and declarations
of pooled units and the units created thereby (including
without limitation all units created under orders,
regulations and rules of any Governmental Authority) which
may affect all or any portion of the Hydrocarbon Interests;
all operating agreements, contracts and other agreements
which relate to any of the Hydrocarbon Interests or the
production, sale, purchase, exchange or processing of
Hydrocarbons from or attributable to such Hydrocarbon
Interests; all hydrocarbons in and under and which may be
produced and saved or attributable to the Hydrocarbon
Interests, including all oil in tanks, the lands covered
thereby and all rents, issues, profits, proceeds, products,
revenues and other incomes from or attributable to the
Hydrocarbon Interests; all tenements, hereditaments,
appurtenances and properties in any manner appertaining,
belonging, affixed or incidental to the Hydrocarbon
Interests; and all properties, rights, titles, interests and
estates described or referred to above, including any and
all property, real or personal, now owned or hereinafter
acquired and situated upon, used, held for use or useful in
connection with the operating, working or development of any
of such Hydrocarbon Interests or property (excluding
drilling rigs, automotive equipment or other personal
property which may be on such premises for the purpose of
drilling a well or for other similar temporary uses) and
including any and all oil xxxxx, gas xxxxx, injection xxxxx
or other xxxxx, buildings, structures, fuel separators,
liquid extraction plants, plant compressors, pumps, pumping
units, field gathering systems, tanks and tank batteries,
fixtures, valves, fittings, machinery and parts, engines,
boilers, meters, apparatus, equipment, appliances, tools,
implements, cables, wires, towers, casing, tubing and rods,
surface leases, rights-of-way, easements and servitudes
together with all additions, substitutions, replacements,
accessions and attachments to any and all of the foregoing.
"Permitted MOXY Encumbrances" shall mean: (i)
Liens for taxes, assessments or other governmental charges
or levies not yet due or which are being contested in good
faith by appropriate action and for which adequate reserves
have been maintained; (ii) Liens in connection with
workmen's compensation, unemployment insurance or other
social security, old age pension or public liability
obligations not yet due or which are being contested in good
faith by appropriate action and for which adequate reserves
have been maintained in accordance with GAAP; (iii)
operators', vendors', carriers', warehousemen's,
repairmen's, mechanics', workmen's, materialmen's,
construction or other like Liens arising by operation of law
or lien in favor of operators or co-interest owners under
contract in the ordinary course of business or incident to
the exploration, development, operation and maintenance of
oil and gas properties or interests (including without
limitation all presently existing or future unitization,
pooling agreements, operating agreements, contracts and
other agreements which relate to any such properties or
interests or the production, sale, purchase, exchange or
processing of hydrocarbons, and all properties, rights,
titles, interests and estates described or referred to
above, including any and all property, real or personal, now
owned or hereinafter acquired and situated upon, used, held
for use or useful in connection with the operating, working
or development of any such interests or properties) or
statutory landlord's liens, each of which is in respect of
obligations that have not been outstanding more than 90 days
or which are being contested in good faith by appropriate
proceedings and for which adequate reserves have been
maintained in accordance with GAAP; (iv) any Liens reserved
in leases or farmout agreements for rent or royalties and
for compliance with the terms of the farmout agreements or
leases in the case of leasehold estates, to the extent that
any such Lien referred to in this clause does not materially
impair the use of the property covered by such Lien for the
purposes for which such property is held by MOXY or any
Subsidiary of MOXY or materially impair the value of such
property subject thereto; (v) encumbrances (other than to
secure the payment of borrowed money or the deferred
purchase price of property or services), easements,
restrictions, servitudes, permits, conditions, covenants,
exceptions or reservations in any rights of way or other
property of MOXY or any Subsidiary of MOXY for the purpose
of roads, pipelines, transmission lines, transportation
lines, distribution lines for the removal of gas, oil, coal
or other minerals or timber, and other like purposes, or for
the joint or common use of real estate, rights of way,
facilities and equipment, and defects, irregularities,
zoning restrictions and deficiencies in title of any rights
of way or other property which in the aggregate do not
materially impair the use of such rights of way or other
property for the purposes of which such rights of way and
other property are held by MOXY or any Subsidiary MOXY or
materially impair the value of such property subject
thereto; (vi) deposits of cash or securities in existence on
the March 2002 Amendment Effective Date to secure the
performance of bids, trade contracts, leases, statutory
obligations and other obligations of a like nature incurred
in the ordinary course of business; (vii) Liens permitted by
the MOXY Security Documents; (viii) required margin deposits
on hedge agreements arising in the ordinary course of
business; (ix) Liens of lessors of property (in such
capacity) leased by MOXY, which Lien in any such case is
limited to the property leased thereunder; (x) Liens
identified on Schedules I or III to the March 2002 Amendment
or any Liens required to be created as a result of the
documents creating any such Liens; and (xi) Liens (other
than to secure the payment of borrowed money or the deferred
purchase price of property or services) reasonably
acceptable to the Collateral Agent as reflected on title
reports or title opinions delivered by MOXY to the
Collateral Agent.
"Proved Properties" means properties listed as
having "proved developed oil and gas reserves" on the report
entitled "McMoRan Oil & Gas LLC Estimated Future Reserves as
of December 31, 2001" prepared by Xxxxx Xxxxx.
"Qualifying Drilling Project" means a drilling,
exploration or development agreement between MOXY and a
third party that is not an Affiliate of MOXY (a "Drilling JV
Partner") which is entered into on arm's length terms in the
ordinary course of MOXY's exploration and development
activities and pursuant to which (i) MOXY conveys or agrees
to convey to the Drilling JV Partner a Hydrocarbon Interest
in specific Exploration Properties and (ii) in consideration
therefor, the Drilling JV Partner (A) agrees to bear and be
responsible for a specified percentage of the exploration
and/or development costs and/or (B) agrees to make a cash
payment to MOXY and/or (C) agrees to assign to MOXY a
Hydrocarbon Interest on which MOXY grants a Lien in favor of
the Collateral Agent for the benefit of the Secured Parties
contemporaneously with the acquisition thereof and (iii)
shall not include any consideration other than as described
in (ii) above; provided, however, that all interests
conveyed to Drilling JV Partners in respect of all such
projects shall not relate, on a cumulative basis, to more
than 125,000 acres of Exploration Properties.
"Sulphur Disposition" has the meaning set forth in
the definition of "Maturity Date".
"Sulphur Sale Condition" means that, on or prior
to March 29, 2002, (x) a definitive sale agreement providing
for a Sulphur Disposition has been executed and delivered by
the Borrower and a purchaser and true and correct copies
thereof provided to the Lenders and (y) such definitive
agreement and Sulphur Disposition, including without
limitation the terms, conditions and pricing thereof, have
been consented to in writing by each of the Lenders, in its
discretion, pursuant to a notice given to the Administrative
Agent.
(c) Each of the following definitions in Section 1.01
is amended and restated in its entirety as follows:
"Casualty" shall mean any casualty or insured
damages to any portion of any Mortgaged Property or any MOXY
Mortgaged Property.
"Collateral" shall mean all the "Collateral" as
defined in any Security Document or any MOXY Security
Document and shall also include the Mortgaged Property and
the MOXY Mortgaged Property.
"Condemnation" shall mean the institution of any
action or proceeding for the taking of any Mortgaged
Property or any MOXY Mortgaged Property, or any part thereof
or interest therein, for public or quasi-public use under
the power of eminent domain, by reason of any public
improvement or condemnation proceeding, or in any other
manner.
"Loan Documents" means the January 1999 Amendment,
the August 2000 Amendment, the April 2001 Amendment, the
August 2001 Amendment, the October 2001 Amendment, the
January 2002 Amendment, the February 2002 Amendment, the
February 2002 Consent, the March 2002 Amendment, the Credit
Agreement, the MOXY Guarantee Agreement, the Security
Documents, the MOXY Security Documents and all other
agreements, certificates and instruments now or hereafter
entered into in connection therewith or in furtherance
thereof, in each case as amended and modified from time to
time.
"MOXY" means McMoRan Oil & Gas LLC, a Delaware
limited liability company and a wholly-owned Subsidiary of
the Guarantor.
"Net Proceeds" means (i) the gross fair market
value of the consideration or other amounts payable to or
receivable by the Borrower, the Guarantor, any of the
Restricted Subsidiaries or MOXY (provided that in the case
of MOXY, only cash consideration shall be included) in
respect of any sales, transfers, distributions or other
dispositions (including by merger or consolidation) of
assets, properties or interests therein (including any
capital or other equity interests owned), less (ii) the
amount, if any, of all taxes (but only to the extent such
Person reasonably estimates that such taxes will be paid on
the date of the next tax filing by such Person or such
Affiliate of such Person), and reasonable and customary
fees, commissions, costs and other expenses (other than
those payable to the Guarantor, the Borrower or any of their
Affiliates) which are incurred in connection with such
sales, transfers, distributions or other dispositions and
are payable by the seller or the transferor (or an Affiliate
of the seller or the transferor) of the assets or property
to which such sales, transfers, distributions or other
dispositions relate, but only to the extent not already
deducted in arriving at the amount referred to in clause
(i). Under no circumstances will any trade payables, claims
of materialmen, mechanics, suppliers or similar expenses be
deducted in computing Net Proceeds in respect of any sale,
transfer, distribution or other disposition.
(d) Section 2.07 is amended by adding a new paragraph
(e) thereto to read in its entirety as follows:
"(e) In the event and on each occasion prior to the
MOXY Release Date that any Net Proceeds are received by or
on behalf of MOXY (or any Affiliate of MOXY) as
consideration for the conveyance or transfer of any
Hydrocarbon Interest in Exploration Properties conveyed to a
Drilling JV Partner in connection with a Qualifying Drilling
Project, the Total Commitments shall be permanently reduced
on the date of such receipt by an amount equal to 75% of
such Net Proceeds (and Loans repaid on that date to the
extent necessary so that the aggregate amount of Loans
outstanding does not exceed the Total Commitments)."
(e) Section 3.01 is amended by adding a new paragraph
(s) to read in its entirety as follows:
"(s) Certain MOXY Representations. (i) The MOXY
Security Agreement is effective to create in favor of the
Collateral Agent, for the ratable benefit of the Secured
Parties, a legal, valid and enforceable security interest in
the MOXY Collateral covered thereby and, when financing
statements in appropriate form are filed in the offices
specified on the MOXY Perfection Certificate, the MOXY
Security Agreement shall constitute a fully perfected Lien
on, and security interest in, all right, title and interest
of the grantors thereunder in such collateral, in each case
prior and superior to any other Lien, other than Liens of
the types referred to in Section 5.02(i) and (vi) Liens
expressly permitted by Section 10.16 and Permitted MOXY
Encumbrances.
(ii) The MOXY Mortgages are effective to create in
favor of the Collateral Agent, for the ratable benefit of
the Secured Parties, a legal, valid and enforceable Lien on
all of the respective mortgagee's right, title and interest
in and to the MOXY Mortgaged Property thereunder and the
proceeds thereof, and when the MOXY Mortgages are filed in
the offices specified on Schedule II to the March 2002
Amendment, the MOXY Mortgages shall constitute a fully
perfected Lien on, and security interest in, all right,
title and interest of such mortgagee in such MOXY Mortgaged
Property and the proceeds thereof, in each case prior and
superior to any other Lien, other than Liens of the type
referred to in Section 5.02(d)(i) and (vi), Liens expressly
permitted by Section 10.16 and Permitted MOXY Encumbrances.
(iii) Schedule I to the March 2002 Amendment lists
completely and correctly as of the March 2002 Amendment
Effective Date all real property, including all Hydrocarbon
Interests, owned or leased by MOXY (other than real property
with a fair market value that in the aggregate does not
exceed $250,000) and the addresses or location thereof.
MOXY owns an interest of the type described in Schedule I in
all the real property set forth on Schedule I to the March
2002 Amendment.
(iv) The MOXY Collateral covered by the MOXY Security
Documents includes substantially all of MOXY's right, title
and interest in and to all Hydrocarbon Interests and Oil and
Gas Properties owned or leased by MOXY which are susceptible
to having a Lien created thereon in favor of the Collateral
Agent.
(v) MOXY has no Subsidiaries other than those listed on
Schedule III."
(f) Section 5.01(r) is amended to read in its entirety
as follows:
"(r) [Intentionally Omitted]".
(g) Section 5.02 is amended by adding new paragraphs
(r), (s), (t) and (u) to read in their entirety as follows:
"(r) The Guarantor will not cause or permit MOXY to (i)
form or acquire any Subsidiary, (ii) purchase any securities
of, make any investment in, or make any loan or advance to,
any Subsidiary or any other Person other than Permitted
Investments, or (iii) pay or make any dividend or
distribution on, or purchase, retire, redeem or otherwise
acquire any shares of, any capital stock or other equity
interest of MOXY other than dividends or distributions from
MOXY to the Guarantor that are made for the purpose of being
contributed by the Guarantor to the Borrower.
(s) The Guarantor will, at all times on and after the
date that is 14 days, or in the case of the MOXY Mortgaged
Property located in Oklahoma 20 days, after the March 2002
Amendment Effective Date and prior to the MOXY Release Date,
cause the MOXY Collateral Requirement to be satisfied
(except as provided in clause (ii) of the proviso of
subsection (d) of the definition of MOXY Collateral
Requirement).
(t) Until the MOXY Release Date, the Guarantor will not
cause or permit MOXY to enter into any drilling, exploration
or development joint ventures with respect to the MOXY
Collateral pursuant to which MOXY conveys or agrees to
convey a Hydrocarbon Interest to a third party other than
Qualifying Drilling Projects.
(u) The Guarantor will at all times cause MOXY to
comply with the following Sections 5.01(k) and 5.01(l) of
this Agreement with the same effect as though MOXY were
named in such Sections each time a reference to the Borrower
is made therein."
(h) Section 7.01(n) is hereby amended and restated in
its entirety as follows:
"(n) any security interest purported to be created by
any Security Document or (prior to the MOXY Release Date)
any MOXY Security Document shall cease to be, or shall be
asserted by the Borrower, the Guarantor or MOXY not to be, a
valid, perfected, first priority (except as otherwise
expressly provided in this Agreement, such Security Document
or such MOXY Security Document) security interest in the
assets or properties covered thereby, except to the extent
that such loss is covered by a lender's title insurance
policy and the related insurer promptly after such loss
shall have acknowledged in writing that such loss is covered
by such title insurance policy; and"
(i) Section 7.01(o) is hereby amended and restated in
its entirety as follows:
"(o) the requirements of clauses (c) or (d) of the
definition of "Collateral Requirement" or the requirements
of clauses (c) or (d) of the definition of "MOXY Collateral
Requirement" shall not have been satisfied within 45 days of
the Amendment Effective Date or 14 days, or in the case of
the MOXY Mortgaged Property located in Oklahoma 20 days, of
the March 2002 Amendment Effective Date, or with respect to
clause (ii) of the proviso set forth in subsection (d) of
the definition of "MOXY Collateral Requirement", 29 days,
respectively."
(j) The last sentence of subsection (a) of Article
VIII is hereby amended by deleting the phrase "and the Security
Documents" and replacing it with ", the Security Documents and
the MOXY Security Documents".
(k) Section 10.07(b)(v) is hereby amended and restated
as follows:
", (v) subject to Section 10.16, release all or a
substantial part of the Collateral".
(l) A new Section 10.07(b)(vi) is hereby added
immediately following Section 10.07(b)(v) as follows:
"or (vi) release MOXY from its guarantee pursuant to
the MOXY Guarantee Agreement (except as expressly provided
in the MOXY Guarantee Agreement), or limit its liability in
respect of such guarantee".
(m) A new Section 10.16 is hereby added immediately
following Section 10.15 as follows:
"SECTION 10.16. Release of Liens; Subordination. (a)
In the event that the MOXY Reductions in an aggregate
cumulative amount of $10,000,000 have been effected, the
Lenders will, promptly upon the written request of the
Guarantor, release from the Liens of the MOXY Mortgages (i)
all the Proved Properties and (ii) Exploration Properties
constituting 50% of the total acreage of all Exploration
Properties then subject to the MOXY Mortgages (such
Exploration Properties to be released to be designated in
writing by the Guarantor in such request); provided,
however, that no such release under this paragraph (a) shall
be required or requested at any time when a Default or Event
of Default has occurred and is continuing. The Collateral
Agent shall, without the necessity of any consent of any
Lender, execute and deliver all such instruments, releases,
financing statements or other agreements, and take all such
further actions, in each case without representation,
warranty or recourse of any nature, as shall be necessary to
effectuate any release of such MOXY Collateral required
hereby.
(b) In the event that the MOXY Reductions in an
aggregate cumulative amount of $15,000,000 have been
effected (including any such MOXY Reductions referred to in
Section 10.16(a)), the Lenders will, promptly upon the
written request of the Guarantor, release all Liens created
under the MOXY Security Documents and terminate the MOXY
Security Documents; provided, however, that no such release
under this paragraph (b) shall be required or requested at
any time when a Default or Event of Default has occurred and
is continuing. The Collateral Agent shall, without the
necessity of any consent of any Lender, execute and deliver
all such instruments, releases, financing statements or
other agreements, and take all such further actions, in each
case without representation, warranty or recourse of any
nature, as shall be necessary to effectuate any release of
the MOXY Collateral required hereby.
(c) If the Guarantor shall request the release under
any MOXY Security Document of Liens covering interests in
Exploration Properties that are to be transferred to a
Drilling JV Partner in connection with a Qualifying Drilling
Project permitted hereunder, so long as no Default or Event
of Default shall have occurred and be continuing, the
Lenders hereby agree to release Liens on such interests (but
not on interests retained by MOXY in any such Exploration
Properties). In such event, the Guarantor shall deliver to
the Collateral Agent a certificate describing the Qualifying
Drilling Project, including what portion of the drilling
costs each party will bear and what amount of equity in the
exploration project each party will own and what additional
consideration, if any, will be paid to MOXY in connection
with such transaction, stating that such transaction
qualifies as a Qualifying Drilling Project and that it will
comply with the terms of this Agreement (including, if
applicable, Section 2.07(e)). The Collateral Agent, if
satisfied that such certificate is correct, shall, without
the necessity of any consent of any Lender, execute and
deliver all such instruments, releases, financing statements
or other agreements, and take all such further actions, in
each case without representation, warranty or recourse of
any nature, as shall be necessary to effectuate the release
of such Liens upon the closing of such Qualifying Drilling
Project; provided, however, that no such release shall be
required if a Default or Event of Default has occurred and
is continuing or if any prepayment of Loans required by
Section 2.07(e) in connection with the closing of such
transaction is not made when due.
(d) At the written request of the Guarantor, the
Lenders will enter into a subordination agreement in form
and substance reasonably satisfactory to the Collateral
Agent pursuant to which the Liens under the MOXY Security
Documents on Proved Properties (but no other assets) will be
subordinated to Liens securing Debt not in excess of
$10,000,000 in principal amount at any time outstanding
incurred by MOXY under a working capital liquidity loan
facility (and securing interest in respect of such principal
amounts, and related fees, reimbursement obligations and
indemnities under such facility). The Lenders hereby
authorize the Collateral Agent to enter into any such
subordination agreement on their behalf, without the
necessity of any further consent from any Lender.
(e) Notwithstanding any other provisions hereof or the
occurrence of the MOXY Release Date, the MOXY Guarantee
Agreement and MOXY's obligations thereunder shall not be
released, subordinated or otherwise affected pursuant to the
provisions of this Section.
(n) Schedule II to the Credit Agreement is replaced
with Schedule II attached in the form of Exhibit C hereto.
SECTION 2. Representations and Warranties. Each of
the Borrower and the Guarantor represents and warrants to each of
the Lenders that, after giving effect to the amendments
contemplated hereby, (a) the representations and warranties of
the Borrower or the Guarantor, as applicable, set forth in the
Loan Documents are true and correct in all material respects on
and as of the date of this March 2002 Amendment, except to the
extent such representations and warranties expressly relate to an
earlier date (in which case such representations and warranties
shall be true and correct in all material respects as of such
earlier date) and (b) no Default or Event of Default has occurred
and is continuing.
SECTION 3. Effectiveness. This March 2002 Amendment
shall become effective as of the first date (the "March 2002
Amendment Effective Date") when the following conditions are
satisfied:
(a) The Administrative Agent (or its counsel)
shall have received duly executed counterparts hereof that,
when taken together, bear the signatures of the Borrower,
the Guarantor and each of the Lenders;
(b) The Administrative Agent shall have received
a favorable written opinion of Jones, Walker, Waechter,
Poitevent, Carrere & Xxxxxxx, L.L.P., counsel to the
Borrower, the Guarantor and MOXY, in a form satisfactory to
the Administrative Agent and counsel to the Administrative
Agent, in each case (A) dated the March 2002 Amendment
Effective Date, (B) addressed to the Agents and the Lenders,
and (C) covering such matters relating to the Loan
Documents, the MOXY Guarantee Agreement, the MOXY Security
Documents and the transactions contemplated thereby, as the
Administrative Agent shall reasonably request, and each of
the Borrower, the Guarantor and MOXY hereby instructs such
counsel to deliver such opinions;
(c) All legal matters incident to this March 2002
Amendment shall be satisfactory to the Administrative Agent
and counsel to the Administrative Agent;
(d) The Administrative Agent shall have received
(i) a certificate of the Secretary or Assistant Secretary of
each of the Borrower and the Guarantor dated the March 2002
Amendment Effective Date and certifying (A) that attached
thereto is a true and complete copy of resolutions duly
adopted by the Board of Directors of each of the Guarantor,
individually and in its capacity as the sole member of the
Borrower, and of the Borrower authorizing the execution,
delivery and performance of the March 2002 Amendment, and
that such resolutions have not been modified, rescinded or
amended and are in full force and effect, (B) that neither
the certificate of incorporation nor the by-laws of the
Guarantor and neither the articles of organization nor the
operating agreement of the Borrower have been amended since
the versions thereof that were delivered in connection with
the February 2002 Amendment (or represented as being
unchanged from the immediately prior amendment); (ii) a copy
of the articles of organization or analogous organizational
documents, including all amendments thereto, of MOXY,
certified as of a recent date by the Secretary or Assistant
Secretary of MOXY, and a long-form good standing certificate
of MOXY as of a recent date, from the Secretary of State of
the state of its organization; (iii) a certificate of the
Secretary or Assistant Secretary of MOXY dated the March
2002 Amendment Effective Date and certifying (A) that
attached thereto is a true and complete copy of the articles
of organization and the operating agreement of MOXY as in
effect on the March 2002 Amendment Effective Date and at all
times since a date prior to the resolutions described in
clause (B) below, (B) that attached thereto is a true and
complete copy of resolutions duly adopted by the Board of
Directors of MOXY authorizing the execution, delivery and
performance of the MOXY Guarantee and the MOXY Security
Documents, and that such resolutions have not been modified,
rescinded or amended and are in full force and effect, (C)
that neither the articles of organization nor the operating
agreement of MOXY have been amended since the date of the
last amendment thereto shown on the date of the certificate
furnished pursuant to clause (ii) above, and (D) as to the
incumbency and specimen signature of each officer executing
any agreement or any other document delivered in connection
herewith on behalf of MOXY; (iv) a certificate of a
Responsible Officer of MOXY as to the incumbency and
specimen signature of the Secretary or Assistant Secretary
executing the certificate pursuant to clause (iii) above;
and (v) such other documents as the Administrative Agent or
its counsel may reasonably request;
(e) The Agents shall have received certificates,
dated the March 2002 Amendment Effective Date and signed by
a Responsible Officer of each of the Guarantor and the
Borrower, confirming compliance on and as of such date with
the conditions precedent set forth in paragraphs (i) and
(iii) of Section 6.01 of the Credit Agreement, as amended by
this Amendment;
(f) The Administrative Agent shall have received
all fees and other amounts due and payable on or prior to
the March 2002 Amendment Effective Date, including, to the
extent invoiced, reimbursement or payment of all out-of-
pocket expenses required to be reimbursed or paid by the
Borrower hereunder or under any other Loan Document, such
expenses to include the legal fees of Cravath, Swaine &
Xxxxx and Xxxxx and Xxxxxxxx, L.L.P., counsel to the Agents;
(g) The MOXY Collateral Requirement which is
required to be satisfied as of the March 2002 Amendment
Effective Date shall have been satisfied and the MOXY
Collateral Agent shall have received a completed MOXY
Perfection Certificate dated the March 2002 Amendment
Effective Date and signed by a Responsible Officer of each
of the Borrower, the Guarantor and MOXY, together with all
attachments contemplated thereby, including the results of a
search of the Uniform Commercial Code (or equivalent)
filings made with respect to MOXY in the jurisdictions
contemplated by the MOXY Perfection Certificate, together
with copies of the financing statements (or similar
documents) disclosed by such search, and accompanied by
evidence reasonably satisfactory to the Collateral Agent
that the Liens indicated by such financing statements (or
similar documents) are permitted by the Credit Agreement and
the MOXY Security Documents or have been released;
(h) The Administrative Agent shall have received
a certificate, duly executed by a Responsible Officer of
each of the Borrower, the Guarantor and MOXY, stating that
all amounts outstanding under MOXY's bank credit facilities
have been repaid in full and that such bank credit
facilities have been terminated;
(i) There shall be no litigation or
administrative proceedings or other legal or regulatory
developments, actual or threatened, that, in the reasonable
judgment of the Lenders, involve a reasonable possibility of
a Material Adverse Effect or could reasonably be expected to
restrain, prevent or impose burdensome conditions on the
satisfaction of the MOXY Collateral Requirement; and
(j) MOXY shall have in place insurance with
reputable insurance companies or associations (or, to the
extent consistent with prudent business practice, through
its own program of self-insurance) in such amounts and
covering such risks as is usually carried by companies in
similar businesses and owning similar properties in the same
general areas in which MOXY operates.
SECTION 4. Amendment Fee. The Borrower agrees to pay
to each Lender that executes and delivers a copy of this
Amendment to the Administrative Agent (or its counsel) an
amendment fee in an amount equal to 0.50% of such Lender's
aggregate unused Commitment and outstanding Loans as of the March
2002 Amendment Effective Date (giving effect to the reduction in
Total Commitments on the March 2002 Amendment Effective Date);
provided that the Borrower shall have no liability for any such
amendment fee if this Amendment does not become effective. Such
amendment fee shall be deemed earned on the March 2002 Amendment
Effective Date and will be payable in cash to each Lender
entitled to receive such fee on the Maturity Date.
SECTION 5. Applicable Law. THIS MARCH 2002 AMENDMENT
SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE LAWS OF
THE STATE OF NEW YORK.
SECTION 6. No Other Amendments. Except as expressly
set forth herein, this March 2002 Amendment shall not by
implication or otherwise limit, impair, constitute a waiver of,
or otherwise affect the rights and remedies of any party under,
the Credit Agreement or any other Loan Document, nor alter,
modify, amend or in any way affect any of the terms, conditions,
obligations, covenants or agreements contained in the Credit
Agreement or any other Loan Document, all of which are ratified
and affirmed in all respects and shall continue in full force and
effect. Nothing herein shall be deemed to entitle the Borrower
to a consent to, or a waiver, amendment, modification or other
change of, any of the terms, conditions, obligations, covenants
or agreements contained in the Credit Agreement or any other Loan
Document in similar or different circumstances. This March 2002
Amendment shall apply and be effective only with respect to the
provisions of the Credit Agreement specifically referred to
herein.
SECTION 7. Counterparts. This March 2002 Amendment
may be executed in two or more counterparts, each of which shall
constitute an original, but all of which when taken together
shall constitute but one contract. Delivery of an executed
counterpart of a signature page of this March 2002 Amendment by
facsimile transmission shall be as effective as delivery of a
manually executed counterpart of this March 2002 Amendment.
SECTION 8. Headings. Section headings used herein are
for convenience of reference only, are not part of this March
2002 Amendment and are not to affect the construction of, or to
be taken into consideration in interpreting, this March 2002
Amendment.
IN WITNESS WHEREOF, the Borrower, the Guarantor and the
undersigned Lenders have caused this March 2002 Amendment to be
duly executed by their duly authorized officers, all as of the
date first above written.
FREEPORT-McMoRan SULPHUR LLC,
by
Name:
Title:
McMoRan EXPLORATION CO., as Guarantor,
by
Name:
Title:
JPMORGAN CHASE BANK (formerly known as
The Chase Manhattan Bank), individually
and as Administrative Agent, Documentary
Agent and Collateral Agent,
by
Name:
Title:
HIBERNIA NATIONAL BANK,
by
Name:
Title:
BANK OF MONTREAL,
by
Name:
Title:
THE BANK OF NOVA SCOTIA,
by
Name:
Title:
THE BANK OF TOKYO-MITSUBISHI, LTD.,HOUSTON AGENCY,
by
Name:
Title:
THE FUJI BANK, LIMITED,
by
Name:
Title:
GE CAPITAL CFE, INC.,
by
Name:
Title:
BANK ONE, NA (f/k/a Bank One Louisiana,NA),
by
Name:
Title:
