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[U.S. REVOLVING CREDIT AGREEMENT]
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CREDIT AGREEMENT
dated as of March 20, 2001
among
▇▇▇ ▇▇▇▇▇, INC.,
THE LENDERS PARTY HERETO,
THE OTHER AGENTS PARTY HERETO,
U.S. BANK NATIONAL ASSOCIATION,
as U.S. Syndication Agent,
BNP PARIBAS,
as U.S. Documentation Agent,
and
THE CHASE MANHATTAN BANK,
as Global Administrative Agent
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▇▇ ▇▇▇▇▇▇, A DIVISION OF CHASE SECURITIES INC.,
as Sole Bookrunner and Lead Arranger
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TABLE OF CONTENTS
ARTICLE I Definitions ...........................................................................1
1.1. Defined Terms..........................................................................1
1.2. Classification of Loans and Borrowings.................................................26
1.3. Terms Generally........................................................................26
1.4. Accounting Terms; GAAP.................................................................26
ARTICLE II The Credits ...........................................................................26
2.1. Commitments............................................................................26
2.2. Loans and Borrowings.................................................................. 27
2.3. Requests for Borrowings................................................................27
2.4. Letters of Credit......................................................................28
2.5. Funding of Borrowings..................................................................32
2.6. Interest Elections.....................................................................33
2.7. Global Borrowing Base..................................................................34
2.8. Termination and Reduction of Commitments...............................................38
2.9. Repayment of Loans; Evidence of Indebtedness...........................................38
2.10. Prepayment of Loans....................................................................39
2.11. Fees...................................................................................41
2.12. Interest...............................................................................42
2.13. Alternate Rate of Interest.............................................................43
2.14. Illegality.............................................................................43
2.15. Increased Costs........................................................................44
2.16. Break Funding Payments.................................................................45
2.17. Taxes..................................................................................46
2.18. Payments Generally; Pro Rata Treatment; Sharing of Set-offs............................47
2.19. Mitigation Obligations; Replacement of Lenders.........................................49
2.20. Currency Conversion and Currency Indemnity.............................................50
2.21. Addition of Lenders and Increase in Commitments........................................51
ARTICLE III Representations and Warranties.........................................................51
3.1. Corporate Existence....................................................................52
3.2. Financial Condition....................................................................52
3.3. Litigation.............................................................................52
3.4. No Breach..............................................................................53
3.5. Authority..............................................................................53
3.6. Approvals..............................................................................53
3.7. Use of Proceeds and Letters of Credit..................................................53
3.8. ERISA..................................................................................53
3.9. Taxes..................................................................................54
3.10. Properties, etc........................................................................55
3.11. No Material Misstatements..............................................................55
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3.12. Investment Company Act.................................................................56
3.13. Public Utility Holding Company Act.....................................................56
3.14. Subsidiaries...........................................................................56
3.15. Location of Business and Offices.......................................................56
3.16. Defaults...............................................................................56
3.17. Environmental Matters..................................................................56
3.18. Compliance with the Law................................................................57
3.19. Insurance..............................................................................57
3.20. Hedging Agreements.....................................................................58
3.21. Restriction on Liens...................................................................58
3.22. Material Agreements....................................................................58
3.23. Solvency...............................................................................58
ARTICLE IV Conditions ............................................................................59
4.1. Initial Loan...........................................................................59
4.2. Each Credit Event......................................................................62
ARTICLE V Affirmative Covenants..................................................................63
5.1. Reporting Requirements.................................................................63
5.2. Litigation.............................................................................65
5.3. Maintenance, Etc.......................................................................66
5.4. Environmental Matters..................................................................67
5.5. Further Assurances.....................................................................67
5.6. Performance of Obligations.............................................................67
5.7. Reserve Reports........................................................................68
5.8. Title to Oil and Gas Properties........................................................68
5.9. ERISA Information and Compliance.......................................................68
5.10. Additional Subsidiaries................................................................69
5.11. Gas Marketing..........................................................................69
ARTICLE VI Financial Covenants....................................................................69
6.1. Tangible Net Worth.....................................................................69
6.2. Indebtedness to EBITDAX Ratio..........................................................70
ARTICLE VII Negative Covenants.....................................................................70
7.1. Indebtedness...........................................................................70
7.2. Liens..................................................................................71
7.3. Investments............................................................................71
7.4. Dividends, Distributions and Redemptions...............................................73
7.5. Sales and Leasebacks...................................................................73
7.6. Nature of Business.....................................................................73
7.7. Limitation on Leases...................................................................73
7.8. Mergers, Etc...........................................................................73
7.9. Proceeds of Loans and Letters of Credit................................................74
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7.10. ERISA Compliance.......................................................................74
7.11. Sale or Discount of Receivables.......................................................75
7.12. Sale of Oil and Gas Properties.........................................................75
7.13. Environmental Matters..................................................................75
7.14. Transactions with Affiliates...........................................................75
7.15. Subsidiaries...........................................................................76
7.16. Negative Pledge Agreements.............................................................76
7.17. Hedging Agreements.....................................................................76
ARTICLE VIII Events of Default......................................................................77
8.1. Listing of Events of Default...........................................................77
8.2. Action if Bankruptcy...................................................................78
8.3. Action if Other Event of Default.......................................................79
ARTICLE IX Agents ................................................................................79
ARTICLE X Miscellaneous .........................................................................81
10.1. Notices................................................................................81
10.2. Waivers; Amendments....................................................................83
10.3. Expenses; Indemnity; Damage Waiver.....................................................84
10.4. Successors and Assigns.................................................................86
10.5. Survival...............................................................................88
10.6. Counterparts; Effectiveness............................................................89
10.7. Severability...........................................................................89
10.8. Right of Setoff........................................................................89
10.9. GOVERNING LAW; JURISDICTION; CONSENT TO SERVICE OF PROCESS.............................90
10.10. WAIVER OF JURY TRIAL...................................................................91
10.11. Headings...............................................................................91
10.12. Confidentiality........................................................................91
10.13. Interest Rate Limitation...............................................................92
10.14. Collateral Matters; Hedging Agreements; Overdraft Facility.............................93
10.15. Arranger; U.S. Documentation Agent; U.S. Syndication Agent;
Other Agents...........................................................................93
10.16. Intercreditor Agreement; Security Documents............................................94
10.17. NO ORAL AGREEMENTS.....................................................................94
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EXHIBITS AND SCHEDULES
EXHIBITS:
Exhibit A Form of Legal Opinion of ▇▇▇▇▇▇ & ▇▇▇▇▇▇ L.L.P.
Exhibit B Form of Lender Certificate
Exhibit C Form of Compliance Certificate
Exhibit D Form of Assignment and Acceptance
Exhibit E-1 Form of Borrowing Request
Exhibit E-2 Form of Interest Election Request
Exhibit F Form of Pledge Agreement
Exhibit G Form of Guaranty
Exhibit H Subsidiary Guarantors
SCHEDULES:
Schedule 2.1 Commitments
Schedule 3.2 Liabilities
Schedule 3.9 Taxes
Schedule 3.10 Properties
Schedule 3.14 Subsidiaries and Partnerships
Schedule 3.19 Insurance
Schedule 3.20 Hedging Agreements
Schedule 3.22 Material Agreements
Schedule 7.1 Indebtedness
Schedule 7.2 Liens
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CREDIT AGREEMENT
THIS CREDIT AGREEMENT, dated as of March 20, 2001, is among ▇▇▇ ▇▇▇▇▇,
INC., a Delaware corporation (the "Borrower"), the LENDERS party hereto, the
other Agents party hereto, U.S. BANK NATIONAL ASSOCIATION, as U.S. Syndication
Agent, BNP PARIBAS, as U.S. Documentation Agent, and THE CHASE MANHATTAN BANK,
as Global Administrative Agent.
The parties hereto agree as follows:
ARTICLE I
Definitions
SECTION 1.1. Defined Terms. As used in this Agreement, the following
terms have the meanings specified below:
"ABR", when used in reference to any Loan or Borrowing, refers to
whether such Loan, or the Loans comprising such Borrowing, are bearing interest
at a rate determined by reference to the Alternate Base Rate.
"Acquisition" means the acquisition by TBRL of Stellarton.
"Adjusted LIBO Rate" means, with respect to any Eurodollar Borrowing
for any Interest Period, an interest rate per annum (rounded upwards, if
necessary, to the next 1/16 of 1%) equal to (a) the LIBO Rate for such Interest
Period multiplied by (b) the Statutory Reserve Rate.
"Administrative Questionnaire" means an Administrative Questionnaire in
a form supplied by the Global Administrative Agent.
"Affiliate" of any Person means (i) any Person directly or indirectly
controlled by, controlling or under common control with such first Person, (ii)
any director or officer of such first Person or of any Person referred to in
clause (i) above and (iii) if any Person in clause (i) above is an individual,
any member of the immediate family (including parents, spouse and children) of
such individual and any trust whose principal beneficiary is such individual or
one or more members of such immediate family and any Person who is controlled by
any such member or trust. For purposes of this definition, any Person which owns
directly or indirectly 10% or more of the securities having ordinary voting
power for the election of directors or other governing body of a corporation or
10% or more of the partnership or other ownership interests of any other Person
(other than as a limited partner of such other Person) will be deemed to
"control" (including, with its correlative meanings, "controlled by" and "under
common control with") such corporation or other Person.
"Agents" means each of the Global Administrative Agent, the U.S.
Syndication Agent, the U.S. Documentation Agent, the Managing Agent and the
Co-Agent.
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"Agreed Currency" is defined in Section 2.20(a).
"Agreement" means this Credit Agreement, as it may be amended,
supplemented, restated or otherwise modified and in effect from time to time.
"Allocated Canadian Borrowing Base" means from time to time the
"Allocated Canadian Borrowing Base" as determined in accordance with Section
2.7(d)(ii).
"Allocated U.S. Borrowing Base" means from time to time the "Allocated
U.S. Borrowing Base" as determined in accordance with Section 2.7(d)(i).
"Alternate Base Rate" means, for any day, a rate per annum equal to the
greater of (a) the Prime Rate in effect on such day, and (b) the Federal Funds
Effective Rate in effect on such day plus 1/2 of 1%. Any change in the Alternate
Base Rate due to a change in the Prime Rate or the Federal Funds Effective Rate
shall be effective from and including the effective date of such change in the
Prime Rate or the Federal Funds Effective Rate, respectively. If for any reason
the Global Administrative Agent shall have determined (which determination shall
be conclusive and binding, absent manifest error) that it is unable to ascertain
the Federal Funds Effective Rate for any reason, including, without limitation,
the inability or failure of the Global Administrative Agent to obtain sufficient
bids or publications in accordance with the terms hereof, the Alternate Base
Rate shall be the Prime Rate until the circumstances giving rise to such
inability no longer exist.
"Applicable Lending Office" means, for each Lender and for each Type of
Loan, such office of such Lender (or of an Affiliate of such Lender) as such
Lender may from time to time specify in writing to the Global Administrative
Agent and the Borrower as the office by which its Loans of such Type are to be
made and/or issued and maintained.
"Applicable Percentage" means, with respect to any Lender, the
percentage of the total Commitments represented by such Lender's Commitment. If
the Commitments have terminated or expired, the Applicable Percentages shall be
determined based upon the Commitments most recently set forth in the Register,
giving effect to any assignments made in accordance with Section 10.4 or any
increases or decreases in Commitments made in accordance with this Agreement.
"Applicable Rate" means, for any day and with respect to any Eurodollar
Loans, any ABR Loans or any Commitment Fees payable hereunder, as the case may
be, the applicable rate per annum set forth below under the caption "Eurodollar
Loans", "ABR Loans" or "Commitment Fees", as the case may be, based on the
Global Borrowing Base Utilization on such date.
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Global Borrowing Base: Eurodollar Loans ABR Loans Commitment Fees
Utilization (in basis points) (in basis points) (in basis points)
----------- ----------------- ----------------- -----------------
Less than 25% 100.0 0.0 25.0
25% or greater and less than 33% 112.5 12.5 25.0
33% or greater and less than 50% 125.0 25.0 25.0
50% or greater and less than 75% 137.5 37.5 37.5
75% or greater 150.0 50.0 37.5
For purposes of the foregoing, any change in the Applicable Rate will
occur automatically without prior notice upon any change in the Global Borrowing
Base Utilization. Each change in the Applicable Rate shall apply during the
period commencing on the effective date of such change and ending on the date
immediately preceding the effective date of the next such change.
"Approved Engineer" means (a) ▇▇▇▇▇ ▇▇▇▇▇ Petroleum Engineers, (b)
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ & ▇▇▇▇ Associates, Ltd., or (c) such other firm of independent
petroleum engineers expert in the matters required to be performed in connection
with the preparation and delivery or auditing of a Reserve Report and reasonably
satisfactory to the Global Administrative Agent.
"Arranger" means ▇▇ ▇▇▇▇▇▇, a Division of Chase Securities Inc.
"Assignment and Acceptance" means an assignment and acceptance entered
into by a Lender and an assignee (with the consent of any party whose consent is
required by Section 10.4), and accepted by the Global Administrative Agent, in
substantially the form of Exhibit D or any other form approved by the Global
Administrative Agent.
"Authorized Officer" means the Chairman, the President, any Vice
President or the Treasurer of the Borrower or any other officer of the Borrower
specified as such to the Global Administrative Agent in writing by any of the
aforementioned officers of the Borrower or by resolution from the board of
directors of the Borrower.
"Availability Period" means the period from and including the Global
Effective Date to but excluding the earlier of the Maturity Date and the date of
termination of the Commitments.
"Board" means the Board of Governors of the Federal Reserve System of
the United States of America.
"Borrower" has the meaning given to such term in the preamble.
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"Borrowing" means Loans of the same Type, made, converted or continued
on the same date and, in the case of Eurodollar Loans, as to which a single
Interest Period is in effect.
"Borrowing Base Properties" means those Oil and Gas Properties owned by
the Borrower or its Subsidiaries that are given value in the determination of
the then current Global Borrowing Base.
"Borrowing Request" means a request by the Borrower for a Borrowing in
accordance with Section 2.3, in substantially the form of Exhibit E-1 or any
other form approved by the Global Administrative Agent.
"Business Day" means any day that is not a Saturday, Sunday or other
day on which commercial banks in New York City are authorized or required by law
to remain closed; provided that, when used in connection with a Eurodollar Loan,
the term "Business Day" shall also exclude any day on which banks are not open
for dealings in dollar deposits in the London interbank market.
"Canadian Administrative Agent" means The Chase Manhattan Bank of
Canada, in its capacity as Canadian administrative agent for the lenders party
to each of the Canadian Revolving Credit Agreement and the Canadian Term Credit
Agreement and any successor thereto.
"Canadian Borrowers" means (i) the Canadian Revolving Borrowers and
(ii) the Canadian Term Borrower.
"Canadian Documentation Agent" means The Toronto-Dominion Bank, in its
capacity as Canadian documentation agent for the lenders party to each of the
Canadian Revolving Credit Agreement and the Canadian Term Credit Agreement and
any successor thereto.
"Canadian Dollars" or "C$" refers to lawful money of Canada.
"Canadian Revolving Borrowers" means TBRL and TBF, as borrowers under
the Canadian Revolving Credit Agreement.
"Canadian Revolving Commitment" means, with respect to each Canadian
Revolving Lender, the "Commitment" of such Canadian Revolving Lender (as defined
in the Canadian Revolving Credit Agreement). The initial aggregate amount of the
Canadian Revolving Commitments is U.S.$55,000,000.
"Canadian Revolving Credit Agreement" means that certain Credit
Agreement of even date herewith among the Canadian Revolving Borrowers, the
Canadian Revolving Lenders, the other agents party thereto, the Global
Administrative Agent, the Canadian Administrative Agent, the Canadian
Syndication Agent and the Canadian Documentation Agent, as it may be amended,
supplemented, restated or otherwise modified and in effect from time to time.
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"Canadian Revolving Lenders" means the financial institutions from time
to time party to the Canadian Revolving Credit Agreement and their respective
successors and permitted assigns.
"Canadian Revolving Loan Documents" means the Canadian Revolving Credit
Agreement, any guaranties, any security documents, any assignment agreements,
and the agreement with respect to fees, together with all exhibits, schedules
and attachments thereto, and all other agreements, documents, certificates,
financing statements and instruments from time to time executed and delivered
pursuant to or in connection with any of the foregoing.
"Canadian Revolving Obligations" means, at any time, the Equivalent
Amount in U.S. Dollars of the sum of (a) the aggregate "Credit Exposure" (as
defined in the Canadian Revolving Credit Agreement) of the Canadian Revolving
Lenders under the Canadian Revolving Loan Documents plus (b) all accrued and
unpaid interest and fees owing to the Canadian Revolving Lenders under the
Canadian Revolving Loan Documents plus (c) all other obligations (monetary or
otherwise) of the Canadian Revolving Borrowers to any Canadian Revolving Lender
or the "Agents" (as defined in the Canadian Revolving Credit Agreement) under
the Canadian Revolving Credit Agreement, whether or not contingent, arising
under or in connection with any of the Canadian Revolving Loan Documents.
"Canadian Revolving Security Documents" means the "Security Documents"
as defined under the Canadian Revolving Credit Agreement.
"Canadian Security Documents" means the Canadian Revolving Security
Documents and the Canadian Term Security Documents.
"Canadian Syndication Agent" means The Bank of Nova Scotia, in its
capacity as Canadian syndication agent for the lenders party to each of the
Canadian Revolving Credit Agreement and the Canadian Term Credit Agreement and
any successor thereto.
"Canadian Term Borrower" means TBF, as borrower under the Canadian Term
Credit Agreement.
"Canadian Term Credit Agreement" means that certain Credit Agreement of
even date herewith among the Canadian Term Borrower, the Canadian Term Lenders,
the other agents party thereto, the Global Administrative Agent and the Canadian
Administrative Agent, as it may be amended, supplemented, restated or otherwise
modified and in effect from time to time.
"Canadian Term Lenders" means the U.S. domiciled financial institutions
from time to time party to the Canadian Term Credit Agreement and their
respective successors and permitted assigns.
"Canadian Term Loan Documents" means the Canadian Term Credit
Agreement, any guaranties, any security documents, any assignment agreements,
and the agreement with respect to fees, together with all exhibits, schedules
and attachments thereto, and all other agreements,
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documents, certificates, financing statements and instruments from time to time
executed and delivered pursuant to or in connection with any of the foregoing.
"Canadian Term Obligations" means, at any time, the Equivalent Amount
in U.S. Dollars of the sum of (a) the "Loans" (as defined in the Canadian Term
Credit Agreement) of the Canadian Term Lenders under the Canadian Term Loan
Documents plus (b) all accrued and unpaid interest and fees owing to the
Canadian Term Lenders under the Canadian Term Loan Documents plus (c) all other
obligations (monetary or otherwise) of the Canadian Term Borrower to any
Canadian Term Lender or the "Agents" (as defined in the Canadian Term Credit
Agreement) under the Canadian Term Credit Agreement, whether or not contingent,
arising under or in connection with any of the Canadian Term Loan Documents.
"Canadian Term Security Documents" means the "Security Documents" as
defined under the Canadian Term Credit Agreement.
"Capital Lease Obligations" means, for any Person, all obligations of
such Person to pay rent or other amounts under a lease of (or other agreement
conveying the right to use) Property to the extent such obligations are required
to be classified and accounted for as a capital lease on a balance sheet of such
Person under GAAP, and, for purposes of this Agreement, the amount of such
obligations shall be the capitalized amount thereof, determined in accordance
with GAAP.
"CERCLA" means the Comprehensive Environmental Response, Compensation
and Liability Act of 1980, 42 U.S.C. Section 9601, et. seq., as amended from
time to time.
"Change in Law" means (a) the adoption of any law, rule or regulation
after the date of this Agreement, (b) any change in any law, rule or regulation
or in the interpretation or application thereof by any Governmental Authority
after the date of this Agreement or (c) compliance by any Lender or any Issuing
Bank (or, for purposes of Section 2.15(b), by any Applicable Lending Office of
such Lender or any Issuing Bank or by such Lender's or any Issuing Bank's
holding company, if any) with any request, guideline or directive (whether or
not having the force of law) of any Governmental Authority made or issued after
the date of this Agreement.
"Change of Control" means the occurrence of any of the following
events: (a) any Person or "group" (within the meaning of Section 13(d) or 14(d)
of the Securities Exchange Act of 1934, as amended) (i) shall have acquired
beneficial ownership of 35% or more of any outstanding class of Equity Interests
having ordinary voting power in the election of directors of the Borrower, (ii)
(A) shall obtain the power (whether or not exercised) to elect a majority of the
Borrower's directors or (B) the Board of Directors of the Borrower shall not
consist of a majority of Continuing Directors, or (b) except as permitted by
Section 7.12, the Borrower shall cease to own, directly or indirectly, 100% of
the issued and outstanding Equity Interests of each of its Wholly-Owned
Subsidiaries. For purposes of this definition, "Continuing Directors" means the
directors of the Borrower on the Closing Date and each other director, if such
other director's nomination for election to the Board of Directors of the
Borrower is recommended by a majority of the then Continuing Directors.
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"Closing Date" means the date of this Agreement.
"Co-Agent" means Comerica Bank-Texas, in its capacity as co-agent for
the Lenders hereunder.
"Code" means the Internal Revenue Code of 1986, as amended from time to
time.
"Collateral" means any and all "Collateral", as defined in all of the
Security Documents.
"Combined Credit Agreements" means this Agreement, the Canadian
Revolving Credit Agreement and the Canadian Term Credit Agreement.
"Combined Credit Exposure" means the sum of (i) the aggregate Credit
Exposure of the Lenders hereunder, (ii) the Equivalent Amount in U.S. Dollars of
the aggregate "Credit Exposure" (as defined in the Canadian Revolving Credit
Agreement) of the Canadian Revolving Lenders, and (iii) the Equivalent Amount in
U.S. Dollars of the "Loans" (as defined in the Canadian Term Credit Agreement).
"Combined Lenders" means the Lenders hereunder, the Canadian Revolving
Lenders and the Canadian Term Lenders.
"Combined Loan Documents" means the Loan Documents, the Canadian
Revolving Loan Documents and the Canadian Term Loan Documents.
"Combined Loans" means the loans made by the Combined Lenders to the
Borrower and the Canadian Borrowers pursuant to the Combined Loan Documents.
"Combined Obligations" means the aggregate of the Obligations, the
Canadian Revolving Obligations and the Canadian Term Obligations (without
duplication of any Hedging Obligations).
"Combined Revolving Commitments" means the aggregate of (i) the
Commitments of the Lenders hereunder and (ii) the Canadian Revolving
Commitments. The initial aggregate amount of the Combined Revolving Commitments
is U.S.$130,000,000.
"Combined Revolving Credit Exposure" means the sum of (i) the aggregate
Credit Exposure of the Lenders hereunder and (ii) the Equivalent Amount in U.S.
Dollars of the aggregate "Credit Exposure" (as defined in the Canadian Revolving
Credit Agreement) of the Canadian Revolving Lenders.
"Combined Revolving Lenders" means (i) the Lenders hereunder and (ii)
the Canadian Revolving Lenders.
"Combined Revolving Obligations" means the aggregate of the Obligations
and the Canadian Revolving Obligations (without duplication of any Hedging
Obligations).
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"Commitment" means, with respect to each Lender, the commitment of such
Lender to make Loans and to acquire participations in Letters of Credit
hereunder, expressed as an amount representing the maximum aggregate amount of
such Lender's Credit Exposure hereunder, as such commitment may be (a) reduced
from time to time pursuant to Section 2.8, (b) reduced or increased from time to
time pursuant to assignments by or to such Lender pursuant to Section 10.4, (c)
increased from time to time pursuant to Section 2.21, and (d) terminated
pursuant to Sections 8.2 or 8.3. The initial amount of each Lender's Commitment
is set forth on Schedule 2.1, or in the Register following any Assignment and
Acceptance to which such Lender is a party or the delivery of a Lender
Certificate to which such Lender is a party. The initial aggregate amount of the
Commitments of the Lenders is U.S.$75,000,000.
"Commitment Fee" is defined in Section 2.11(a).
"Consolidated Net Income" means with respect to the Borrower and its
Consolidated Subsidiaries, for any period, the aggregate of the net income (or
loss) of the Borrower and its Consolidated Subsidiaries for such period,
determined on a consolidated basis in accordance with GAAP; provided that there
shall be excluded from such net income (to the extent otherwise included
therein) the following: (i) the net income of any Person in which the Borrower
or any Consolidated Subsidiary has an interest (which interest does not cause
the net income of such other Person to be consolidated with the net income of
the Borrower and its Consolidated Subsidiaries in accordance with GAAP), except
to the extent of the amount of dividends or distributions actually paid in such
period by such other Person to the Borrower or to a Consolidated Subsidiary, as
the case may be, (ii) the net income (but not loss) of any Consolidated
Subsidiary to the extent that the declaration or payment of dividends or similar
distributions or transfers or loans by that Consolidated Subsidiary is not at
the time permitted by operation of the terms of its Organic Documents or any
agreement, instrument or Governmental Rule applicable to such Consolidated
Subsidiary, or is otherwise restricted or prohibited (other than under
restrictions or prohibitions that the Borrower or a Wholly-Owned Subsidiary of
the Borrower may waive, in its sole discretion), in each case determined in
accordance with GAAP, (iii) any extraordinary gains or losses, (iv) the
cumulative effect of a change in accounting principles, (v) any gains or losses
attributable to writeups or write downs of assets; and (vi) non-cash gains and
losses, including, without limitation, FASB 133 non-cash gains and losses.
"Consolidated Subsidiaries" means each Subsidiary of a Person (whether
now existing or hereafter created or acquired) the financial statements of which
shall be (or should have been) consolidated with the financial statements of
such Person in accordance with GAAP. Unless otherwise indicated, each reference
to the term "Consolidated Subsidiary" means a Subsidiary consolidated with the
Borrower.
"Control" means the possession, directly or indirectly, of the power to
direct or cause the direction of the management or policies of a Person, whether
through the ability to exercise voting power, by contract or otherwise.
"Controlling" and "Controlled" have meanings correlative thereto.
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"Credit Exposure" means, with respect to any Lender at any time, the
sum of the outstanding principal amount of such Lender's Loans and its LC
Exposure at such time.
"Default" means any event or condition which constitutes an Event of
Default or which upon notice, lapse of time or both would, unless cured or
waived, become an Event of Default.
"Deficiency Notification Date" is defined in Section 2.7(f).
"dollars" or "U.S. Dollars" or "U.S.$" refers to lawful money of the
United States of America.
"EBITDAX" means, for any period, the sum of Consolidated Net Income for
such period plus the following expenses or charges to the extent deducted from
Consolidated Net Income in such period: interest, income taxes, depreciation,
depletion, amortization and exploration expense, determined on a consolidated
basis in accordance with GAAP.
"Environmental Laws" means any and all Governmental Rules pertaining to
health or the environment in effect in any and all jurisdictions in which the
Borrower or any Subsidiary is conducting or at any time has conducted business,
or where any Property of the Borrower or any Subsidiary is located, including,
without limitation, OPA, the Clean Air Act, as amended, CERCLA, the Federal
Water Pollution Control Act, as amended, the Occupational Safety and Health Act
of 1970, as amended, the Resource Conservation and Recovery Act of 1976
("RCRA"), as amended, the Safe Drinking Water Act, as amended, the Toxic
Substances Control Act, as amended, the Superfund Amendments and Reauthorization
Act of 1986, as amended, the Hazardous Materials Transportation Act, as amended,
the Environmental Protection and Enhancement Act (Alberta), as amended, the
Canadian Environmental Protection Act, as amended, and other environmental
conservation or protection laws. The term "oil" shall have the meaning specified
in OPA, the term "release" (or "threatened release") shall have the meaning
specified in CERCLA, and the term "disposal" (or "disposed") shall have the
meaning specified in RCRA; provided, however, that (i) in the event either OPA,
CERCLA or RCRA is amended so as to broaden the meaning of any term defined
thereby, such broader meaning shall apply subsequent to the effective date of
such amendment and (ii) to the extent the laws of the state in which any
Property of the Borrower or any Subsidiary is located establish a meaning for
"oil", "release", or "disposal" which is broader than that specified in either
OPA, CERCLA or RCRA, such broader meaning shall apply.
"Environmental Liability" means any liability, contingent or otherwise
(including any liability for damages, costs of environmental remediation, fines,
penalties or indemnities), of the Borrower or any of its Subsidiaries directly
or indirectly resulting from or based upon (a) violation of any Environmental
Law, (b) the generation, use, handling, transportation, storage, treatment or
disposal of any Hazardous Materials, (c) exposure to any Hazardous Materials,
(d) the release or threatened release of any Hazardous Materials into the
environment, or (e) any contract, agreement or other consensual arrangement
pursuant to which liability is assumed or imposed with respect to any of the
foregoing.
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"Equity Interests" means shares of the capital stock, partnership
interests, membership interest in a limited liability company, beneficial
interests in a trust or other equity interests in the Borrower or any Subsidiary
or any warrants, options or other rights to acquire such interests.
"Equivalent Amount" means as at any date the amount of Canadian Dollars
into which an amount of U.S. Dollars may be converted, or the amount of U.S.
Dollars into which an amount of Canadian Dollars may be converted, in either
case at The Bank of Canada mid-point noon spot rate of exchange for such date in
Toronto at approximately 12:00 noon, Toronto time on such date.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended, and any successor statute of similar import, together with the rules,
regulations and interpretations thereunder, in each case as in effect from time
to time.
"ERISA Affiliate" means all members of a controlled group of
corporations and all members of a controlled group of trades or businesses
(whether or not incorporated) under common control which, together with the
Borrower, are treated as a single employer under section 414 (b) or 414 (c) of
the Internal Revenue Code or section 4001(b)(1) of ERISA.
"ERISA Event" means (i) a "reportable event" described in section 4043
of ERISA and the regulations issues thereunder, (ii) the withdrawal of the
Borrower, any Subsidiary or any ERISA Affiliate from a Plan during a plan year
in which it was a "substantial employer" as defined in section 4001(a)(2) of
ERISA, (iii) the filing of a notice of intent to terminate a Plan or the
treatment of a Plan amendment as a termination under section 4041 of ERISA, (iv)
the institution of proceedings to terminate a Plan by the PBGC or (v) 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 Plan.
"Eurodollar", when used in reference to any Loan or Borrowing, refers
to whether such Loan, or the Loans comprising such Borrowing, are bearing
interest at a rate determined by reference to the Adjusted LIBO Rate.
"Event of Default" has the meaning assigned to such term in Section
8.1.
"Excepted Liens" means: (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
in accordance with GAAP, (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 in the ordinary course of business or incident
to the exploration, development, operation and maintenance of Oil and Gas
Properties or statutory landlord's liens, each of which is in respect of
obligations that are not more than 90 days past due or which are being contested
in good faith by appropriate proceedings and for
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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 the Borrower or any Subsidiary 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), rights of first refusal, easements,
restrictions, servitudes, permits, conditions, covenants, exceptions or
reservations in any rights of way or other Property of the Borrower or any
Subsidiary 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 the Borrower or any Subsidiary or materially
impair the value of such Property subject thereto, (vi) deposits to secure the
performance of bids, trade contracts, surety and appeal bonds, and performance
bonds leases, statutory obligations and other obligations of a like nature
incurred in the ordinary course of business, (vii) reservations in original
grants from any Governmental Authority, (viii) Liens associated with judgments
not prohibited by Section 8.1(h), (ix) rights of any Governmental Authority to
terminate a lease and (x) Liens to secure intercompany Investments permitted by
Sections 7.3(h) or (i), provided that such a Lien does not encumber any Oil and
Gas Properties.
"Excluded Taxes" means, with respect to any Agent, any Lender, any
Issuing Bank or any other recipient of any payment to be made by or on account
of any obligation of the Borrower hereunder, (a) income or franchise taxes
imposed on (or measured by) its net income by the United States of America, or
by the jurisdiction under the laws of which such recipient is organized or in
which its principal office is located or, in the case of any Lender, in which
its Applicable Lending Office is located, (b) any branch profits taxes imposed
by the United States of America or any similar tax imposed by any other
jurisdiction in which the recipient is located and (c) in the case of a Foreign
Lender (other than an assignee pursuant to a request by the Borrower under
Section 2.19(b)), any withholding tax that is imposed on amounts payable to such
Foreign Lender at the time such Foreign Lender becomes a party to this Agreement
(or designates a new Applicable Lending Office) or is attributable to such
Foreign Lender's failure to comply with Section 2.17(e), except to the extent
that such Foreign Lender (or its assignor, if any) was entitled, at the time of
designation of a new Applicable Lending Office (or assignment), to receive
additional amounts from the Borrower with respect to such withholding tax
pursuant to Section 2.17(a).
"Existing Credit Facilities" means (i) that certain Credit Agreement,
dated as of June 30, 2000, among the Borrower, TBRL, The Chase Manhattan Bank as
administrative agent and the lenders party thereto, as amended by the First
Amendment to Credit Agreement dated November 20, 2000 and as further amended by
the Second Amendment to Credit Agreement dated January 11, 2001, (ii) that
certain Loan Note, dated January 11, 2001, between TBRL and The Chase Manhattan
Bank, Toronto Branch and (iii) the Stellarton Credit Facility.
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"Federal Funds Effective Rate" means, for any day, the weighted average
(rounded upwards, if necessary, to the next 1/100 of 1%) of the rates on
overnight Federal funds transactions with members of the Federal Reserve System
arranged by Federal funds brokers, as published on the next succeeding Business
Day by the Federal Reserve Bank of New York, or, if such rate is not so
published for any day that is a Business Day, the average (rounded upwards, if
necessary, to the next 1/100 of 1%) of the quotations for such day for such
transactions received by the Global Administrative Agent from three Federal
funds brokers of recognized standing selected by it.
"Fee Letter" means that certain Fee Letter dated as of January 15,
2001, by and among the Borrower, the Global Administrative Agent and the
Arranger, as such letter may be amended, supplemented, restated or otherwise
modified from time to time in accordance with the Loan Documents.
"Financial Statements" means the financial statement or statements of
the Borrower and its Consolidated Subsidiaries described or referred to in
Section 3.2.
"Financing Transactions" means the execution, delivery and performance
by each Loan Party of the Loan Documents to which it is to be a party, the
borrowing of Loans, the use of the proceeds thereof and the issuance of Letters
of Credit hereunder.
"Foreign Lender" means any Lender that is organized under the laws of a
jurisdiction other than that in which the Borrower is located. For purposes of
this definition, the United States of America, each State thereof and the
District of Columbia shall be deemed to constitute a single jurisdiction.
"Foreign Subsidiary" means any Subsidiary that is organized under the
laws of a jurisdiction other than the United States of America or any State
thereof or the District of Columbia.
"GAAP" means generally accepted accounting principles in the United
States of America.
"Gas Marketing Policy" has the meaning set forth in Section 5.1(j).
"Global Administrative Agent" means The Chase Manhattan Bank, in its
capacity as global administrative agent for the Combined Lenders and its
successors.
"Global Borrowing Base" means the "Global Borrowing Base" as determined
from time to time pursuant to Section 2.7.
"Global Borrowing Base Deficiency" means the amount by which (a) the
Combined Credit Exposure exceeds (b) the then current Global Borrowing Base.
"Global Borrowing Base Designation Notice" is defined in Section
2.7(b).
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"Global Borrowing Base Utilization" means, at the time of
determination, an amount (expressed as a percentage) equal to the quotient of
(i) the Combined Credit Exposure divided by (ii) the Global Borrowing Base.
"Global Effective Date" means a date agreed upon by the Borrower and
the Global Administrative Agent as the date on which the conditions specified in
Section 4.1 of each Combined Credit Agreement are satisfied (or waived in
accordance with Section 10.2 of each Combined Credit Agreement).
"Global Effectiveness Notice" means a notice and certificate of the
Borrower properly executed by an Authorized Officer of the Borrower addressed to
the Combined Lenders and delivered to the Global Administrative Agent whereby
the Borrower certifies satisfaction or waiver of all the conditions precedent to
the effectiveness under Section 4.1 of each Combined Credit Agreement.
"Governmental Approval" means (a) any authorization, consent, approval,
license, ruling, permit, tariff, rate, certification, waiver, exemption, filing,
variance, claim, order, judgment or decree of, or with, (b) any required notice
to, (c) any declaration of or with, or (d) any registration by or with, any
Governmental Authority.
"Governmental Authority" means the government of the United States of
America, Canada, any other nation or any political subdivision thereof, whether
state, provincial, territorial or local, and any agency, authority,
instrumentality, regulatory body, court, central bank or other entity exercising
executive, legislative, judicial, taxing, regulatory or administrative powers or
functions of or pertaining to government.
"Governmental Rule" means any statute, law, regulation, ordinance,
rule, judgment, order, decree, permit, concession, grant, franchise, license,
agreement, directive, requirement of, or other governmental restriction or any
similar binding form of decision of or determination by, or any binding
interpretation or administration of any of the foregoing by, any Governmental
Authority, whether now or hereafter in effect.
"Guarantee" means a guarantee, an endorsement, a contingent agreement
to purchase or to furnish funds for the payment or maintenance of, or otherwise
to be or become contingently liable under or with respect to, the Indebtedness,
net worth, working capital or earnings of any Person or any production or
revenues generated by (or any capital or other expenditures incurred in
connection with the acquisition and exploitation of, exploration for,
development of or production from) any Hydrocarbons, or a guarantee of the
payment of dividends or other distributions upon the Equity Interests of any
Person, or an agreement to purchase, sell or lease (as lessee or lessor)
Property, products, materials, supplies or services primarily for the purpose of
enabling a debtor to make payment of such debtor's obligations or an agreement
to assure a creditor against loss, and including, without limitation, causing a
bank, surety company or other financial institution or similar entity to issue a
letter of credit, surety bond or other similar instrument for the benefit of
another
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Person, but excluding endorsements for collection or deposit in the ordinary
course of business. The terms "Guarantee" and "Guaranteed" used as a verb shall
have a correlative meaning.
"Guarantor" means each Subsidiary listed on Exhibit H which shall
execute a Guaranty in favor of the Global Administrative Agent or which is
required to executed a Guaranty pursuant to Section 5.10.
"Guaranty" means a Guaranty made pursuant to Section 4.1(a) or Section
5.10 by a Subsidiary of the Borrower in favor of the Global Administrative
Agent, substantially in the form of Exhibit G, as amended, supplemented,
restated or otherwise modified from time to time in accordance with the terms of
this Agreement and the other Loan Documents. The term "Guaranties" shall include
each and every Guaranty executed and delivered by a Guarantor hereunder.
"Hazardous Material" means all explosive or radioactive substances or
wastes and all hazardous or toxic substances, wastes or other pollutants,
asbestos or asbestos containing materials, polychlorinated biphenyls, radon gas,
infectious or medical wastes and all other substances or wastes of any nature
regulated pursuant to any Environmental Law, and any petroleum, petroleum
products or petroleum distillates and associated oil or natural gas exploration,
production and development wastes that are not exempted or excluded from being
defined as "hazardous substances", "hazardous materials", "hazardous wastes" and
"toxic substances" under such Environmental Laws.
"Hedging Agreements" means any commodity, interest rate or currency
swap, cap, floor, collar, forward agreement or other exchange or protection
agreements or any option with respect to any such transaction.
"Hedging Obligations" means, with respect to any Person, all
liabilities (including but not limited to obligations and liabilities arising in
connection with or as a result of early or premature termination of a Hedging
Agreement, whether or not occurring as a result of a default thereunder) of such
Person under a Hedging Agreement.
"Highest Lawful Rate" is defined in Section 10.13.
"Hydrocarbon Interests" means all rights, titles and interests in and
to oil and gas leases, oil, gas and mineral leases, other Hydrocarbon leases,
mineral interests, mineral servitudes, overriding royalty interests, royalty
interests, net profits interests, Production Payments, and other similar
interests.
"Hydrocarbons" means, collectively, oil, gas, casinghead gas, drip
gasoline, natural gasoline, condensate, distillate and all other liquid or
gaseous hydrocarbons and related minerals and all products therefrom, in each
case whether in a natural or a processed state.
"Increased Commitment Amount" is defined in Section 2.21.
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"Indebtedness" means, for any Person the sum of the following (without
duplication): (i) all obligations of such Person for borrowed money or evidenced
by bonds, debentures, notes or other similar instruments, (ii) all obligations
of such Person (whether contingent or otherwise) in respect of bankers'
acceptances, letters of credit, surety or other bonds and similar instruments,
(iii) all obligations of such Person to pay the deferred purchase price of
Property or services (other than for borrowed money), (iv) all Capital Lease
Obligations, (v) all obligations under operating leases which require such
Person or its Affiliate to make payments over the term of such lease, including
payments at termination, based on the purchase price or appraisal value of the
Property subject to such lease plus a marginal interest rate, and used primarily
as a financing vehicle for, or to monetize, such Property, (vi) all Indebtedness
(as described in the other clauses of this definition) and other obligations of
others secured by a Lien on any asset of such Person, whether or not such
Indebtedness is assumed by such Person, (vii) all Indebtedness (as described in
the other clauses of this definition) and other obligations of others Guaranteed
by such Person or in which such Person otherwise assures a creditor against loss
of the debtor or obligations of others, (viii) all obligations or undertakings
of such Person to maintain or cause to be maintained the financial position or
covenants of others or to purchase the Indebtedness or Property of others, (ix)
obligations to deliver goods or services, including, without limitation,
Hydrocarbons and the forward sale of Hydrocarbons, in consideration of advance
payments, (x) obligations to pay for goods or services whether or not such goods
or services are actually received or utilized by such Person which are more than
90 days past due, (xi) the undischarged balance of any Production Payment
created by such Person or for the creation of which such Person directly or
indirectly received payment, to the extent such Production Payment would be
reflected on a consolidated balance sheet of such Person and (xii) Net
Liabilities in respect of Hedging Obligations.
"Indemnified Taxes" means Taxes other than Excluded Taxes.
"Indemnitee" is defined in Section 10.3(b).
"Initial Reserve Report" means (i) that certain reserve report
delivered to the Global Administrative Agent dated as of January 16, 2001, with
respect to the Oil and Gas Properties of the Borrower and its Subsidiaries as of
January 1, 2001, located in the United States, and (ii) that certain reserve
report delivered to the Global Administrative Agent dated as of December 8,
2000, with respect to the Oil and Gas Properties of Stellarton and its
Subsidiaries as of September 30, 2000, located in Canada, in each case which has
been audited by an Approved Engineer and a true and correct copy of each which
has been delivered to the Global Administrative Agent and the Lenders.
"Intercreditor Agreement" means that certain Intercreditor Agreement
dated as of even date herewith, by and among the Global Administrative Agent,
the U.S. Syndication Agent, the U.S. Documentation Agent, the Canadian
Administrative Agent, the Canadian Syndication Agent, the Canadian Documentation
Agent, each Managing Agent, the Co-Agent, and the Combined Lenders, as amended,
supplemented, restated or otherwise modified from time to time in accordance
with the Combined Loan Documents.
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"Interest Election Request" means a request by the Borrower to convert
or continue a Borrowing in accordance with Section 2.6, in substantially the
form of Exhibit E-2 or any other form approved by the Global Administrative
Agent.
"Interest Payment Date" means (a) with respect to any ABR Loan, the
last day of each March, June, September and December, and (b) with respect to
any Eurodollar Loan, the last day of the Interest Period applicable to the
Borrowing of which such Loan is a part and, in the case of a Eurodollar
Borrowing with an Interest Period of more than three (3) months' duration, each
day prior to the last day of such Interest Period that occurs at intervals of
three (3) months' duration after the first day of such Interest Period.
"Interest Period" means with respect to any Eurodollar Borrowing, the
period commencing on the date of such Borrowing and ending on the numerically
corresponding day, or, with the consent of the Global Administrative Agent, such
other day, in the calendar month that is one, two, three or six months (or, with
the consent of each Lender, nine or twelve months) thereafter, as the Borrower
may elect; provided, that (a) if any Interest Period would end on a day other
than a Business Day, such Interest Period shall be extended to the next
succeeding Business Day unless such next succeeding Business Day would fall in
the next calendar month, in which case such Interest Period shall end on the
next preceding Business Day, (b) any Interest Period pertaining to a Eurodollar
Borrowing that commences on the last Business Day of a calendar month (or on a
day for which there is no numerically corresponding day in the last calendar
month of such Interest Period) shall end on the last Business Day of the last
calendar month of such Interest Period, and (c) no Interest Period may end later
than the last day of the Availability Period. For purposes hereof, the date of a
Borrowing initially shall be the date on which such Borrowing is made and
thereafter shall be the effective date of the most recent conversion or
continuation of such Borrowing.
"Investment" means, for any Person: (a) the acquisition (whether for
cash, Property, services or securities or otherwise) of Equity Interests of any
other Person or any agreement to make any such acquisition (including, without
limitation, any "short sale" or any sale of any securities at a time when such
securities are not owned by the Person entering into such short sale), (b) the
making of any deposit with, or advance, loan or other extension of credit to,
any other Person (including the purchase of Property from another Person subject
to an understanding or agreement, contingent or otherwise, to resell such
Property to such Person, but excluding any such advance, loan or extension of
credit having a term not exceeding 90 days representing the purchase price of
inventory or supplies sold by such Person in the ordinary course of business),
or (c) the entering into of any Guarantee of, or other contingent obligation
with respect to, Indebtedness of any other Person and (without duplication) any
amount committed to be advanced, lent or extended to such Person.
"Issuing Bank" means the Global Administrative Agent or any other
Lender agreed to among the Borrower and the Global Administrative Agent to issue
Letters of Credit.
"Judgment Currency" is defined in Section 2.20(b).
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"LC Disbursement" means a payment made by any Issuing Bank pursuant to
a Letter of Credit.
"LC Exposure" means, at any time, the sum of (a) the aggregate undrawn
amount of all outstanding Letters of Credit at such time plus (b) the aggregate
amount of all LC Disbursements that have not yet been reimbursed by or on behalf
of the Borrower at such time. The LC Exposure of any Lender at any time shall be
its Applicable Percentage of the total LC Exposure at such time.
"Lender Affiliate" means, with respect to any Lender, (i) an Affiliate
of such Lender or (ii) any entity (whether a corporation, partnership, trust or
otherwise) that is engaged in making, purchasing, holding or otherwise investing
in bank loans and similar extensions of credit in the ordinary course of its
business and is administered or managed by a Lender or an Affiliate of such
Lender and with respect to any Lender that is a fund which invests in bank loans
and similar extensions of credit, any other fund that invests in bank loans and
similar extensions of credit and is managed by the same investment advisor as
such Lender or by an Affiliate of such investment advisor.
"Lender Certificate" is defined in Section 2.21.
"Lenders" means the Persons listed on Schedule 2.1 and any other Person
that shall have become a party to this Agreement pursuant to an Assignment and
Acceptance or pursuant to Section 2.21, other than any such Person that ceases
to be a party hereto pursuant to an Assignment and Acceptance.
"Letter of Credit" means any letter of credit issued pursuant to this
Agreement.
"LIBO Rate" means, with respect to any Eurodollar Borrowing for any
Interest Period, the rate appearing on Page 3750 of the Telerate Service (or on
any successor or substitute page of such Service, or any successor to or
substitute for such Service, providing rate quotations comparable to those
currently provided on such page of such Service, as determined by the Global
Administrative Agent from time to time for purposes of providing quotations of
interest rates applicable to dollar deposits in the London interbank market) at
approximately 11:00 a.m., New York City time, two Business Days prior to the
commencement of such Interest Period, as the rate for dollar deposits with a
maturity comparable to such Interest Period. In the event that such rate is not
available at such time for any reason, then the "LIBO Rate" with respect to such
Eurodollar Borrowing for such Interest Period shall be the rate at which dollar
deposits of U.S.$5,000,000 and for a maturity comparable to such Interest Period
are offered by the principal London office of the Global Administrative Agent in
immediately available funds in the London interbank market at approximately
11:00 a.m., London time, two Business Days prior to the commencement of such
Interest Period.
"Lien" means any interest in Property securing an obligation owed
to, or a claim by, a Person other than the owner of the Property, whether such
interest is based on the common law, statute or contract, and whether such
obligation or claim is fixed or contingent, and including but not limited
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to (i) the lien, charge or security interest arising from a mortgage,
encumbrance, pledge, security agreement, conditional sale or trust receipt or a
lease, consignment, bailment or margin account for security purposes or (ii)
Production Payments and the like which constitute Indebtedness, payable out of
Oil and Gas Properties. The term "Lien" shall include reservations, exceptions,
encroachments, easements, rights of way, covenants, conditions, restrictions,
leases and other title exceptions and encumbrances affecting Property. For the
purposes of this Agreement, the Borrower or any Subsidiary shall be deemed to be
the owner of any Property which it has acquired or holds subject to a
conditional sale agreement, or leases under a financing lease or other
arrangement pursuant to which title to the Property has been retained by or
vested in some other Person in a transaction intended to create a financing.
"Loan Document" means (a) this Agreement, the Security Documents, the
Fee Letter, the Intercreditor Agreement, the Hedging Agreements between the
Borrower or any of its Subsidiaries and any Lender or any Affiliate of a Lender,
any Borrowing Request and any Interest Election Request, any Assignment and
Acceptance, and (b) each other agreement, document or instrument delivered by
the Borrower or any other Person in connection with this Agreement, as such may
be amended from time to time.
"Loan Parties" means the Borrower, the Guarantors, TBF and TBRL, and,
after the date of this Agreement, any other Affiliate or Subsidiary of the
Borrower which executes a Loan Document for so long as such Loan Document is in
effect.
"Loans" means the loans made by the Lenders to the Borrower pursuant to
this Agreement.
"Majority Lenders" means (i) prior to the time that the Combined
Revolving Commitments have been terminated and the Combined Revolving Credit
Exposure has been indefeasibly repaid in full in cash, the Combined Revolving
Lenders holding greater than or equal to 66-2/3% of the Combined Revolving
Commitments and (ii) after the Combined Revolving Commitments have been
terminated and the Combined Revolving Credit Exposure has been indefeasibly
repaid in full in cash, the Canadian Term Lenders holding greater than or equal
to 66-2/3% of the "Loans" (as defined in the Canadian Term Credit Agreement)
outstanding under the Canadian Term Credit Agreement.
"Managing Agent" means Christiania Bank OG Kreditkasse, ASA New York
Branch, in its capacity as managing agent for the Lenders hereunder and National
Bank of Canada, in its capacity as managing agent for the Canadian Revolving
Lenders and the Canadian Term Lenders.
"Margin Stock" means "margin stock" within the meaning of Regulation U.
"Marketing Agreements" means any agreement with respect to the
marketing, sale or other exchange of Hydrocarbons (other than with respect to
the Borrower's and its Subsidiaries' Hydrocarbons).
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"Material Adverse Effect" means any material and adverse effect on (i)
the assets, liabilities, financial condition, business, operations or affairs of
the Borrower and its Subsidiaries taken as a whole different from those
reflected in the Financial Statements or from the facts represented or warranted
in any Combined Loan Document, or (ii) the ability of the Borrower and its
Subsidiaries taken as a whole to carry out their business as at the Closing Date
or as proposed as of the Closing Date to be conducted or meet their obligations
under the Combined Loan Documents on a timely basis.
"Maturity Date" means March 20, 2004.
"Moody's" means ▇▇▇▇▇'▇ Investors Service, Inc.
"Multiemployer Plan" means a multiemployer plan as defined in section
4001(a)(3) of ERISA.
"Net Cash Proceeds" means, with respect to any sale or other
disposition of Equity Interests, the cash proceeds (including cash equivalents
and any cash payments received by way of deferred payment of principal pursuant
to a note or installment receivable or purchase price adjustment receivable or
otherwise, but only as and when received) of such sale or other disposition
received by the Borrower or any of its Subsidiaries, net of all attorneys' fees,
accountants' fees, investment banking fees and other customary fees and
commissions actually incurred by the Borrower or any of its Subsidiaries and
documented in connection therewith.
"Net Liabilities" means, with respect to any Person, the net
▇▇▇▇-to-market value determined in accordance with GAAP.
"New York City" means New York, New York.
"Non-Recourse Debt" means any Indebtedness of any Subsidiary which does
not own Borrowing Base Properties, in each case in respect of which (i) the
holder or holders thereof (a) shall have recourse only to, and shall have the
right to require the obligations of such Subsidiary to be performed, satisfied,
and paid only out of, the assets and Property of such Subsidiary and/or one or
more of its Subsidiaries which does not own Borrowing Base Properties and/or any
other Person (other than the Borrower or any Subsidiary owning Borrowing Base
Properties), and (b) shall have no direct or indirect recourse (including by way
of guaranty or indemnity) to the Borrower or any Subsidiary owning Borrowing
Base Properties or to any of the assets or Property of the Borrower or any
Subsidiary owning Borrowing Base Properties, whether for principal, interest,
fees, expenses or otherwise and (ii) the terms and conditions of such
Indebtedness are in form and substance reasonably acceptable to the Required
Lenders.
"Obligations" means (without duplication), at any time, the sum of
(a) the Credit Exposure of the Lenders under the Loan Documents plus (b) all
accrued and unpaid interest and fees owing to the Lenders under the Loan
Documents plus (c) all Hedging Obligations in connection with all Hedging
Agreements between the Borrower or any of its Subsidiaries and any Lender or any
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Affiliate of a Lender plus (d) all other obligations (monetary or otherwise) of
the Borrower or any Subsidiary to any Lender or any Agent, whether or not
contingent, arising under or in connection with any of the Loan Documents.
"Oil and Gas Properties" means the 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
having jurisdiction) which may affect all or any portion of the Hydrocarbon
Interests; all operating agreements, joint venture 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,
the lands covered thereby and all oil in tanks and all rents, issues, profits,
proceeds, products, revenues and other incomes from or attributable to the
Hydrocarbon Interests; all tenements, profits a prendre, hereditaments,
appurtenances and Properties in anywise appertaining, belonging, affixed or
incidental to the Hydrocarbon Interests, 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 ▇▇▇▇▇, gas ▇▇▇▇▇, water ▇▇▇▇▇, injection ▇▇▇▇▇ or other ▇▇▇▇▇,
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.
"OPA" means the Oil Pollution Act of 1990, as amended from time to
time.
"Organic Documents" means, relative to any Person, its articles of
organization, association, formation or incorporation (or comparable document),
its by-laws, memorandum of association or operating agreement and all
partnership agreements, limited liability company or operating agreements and
similar arrangements applicable to ownership.
"Other Currency" is defined in Section 2.20(a).
"Other Taxes" means any and all present or future stamp or documentary
taxes or any other excise or property taxes, charges or similar levies arising
from any payment made under any Loan Document or from the execution, delivery or
enforcement of, or otherwise with respect to, any Loan Document.
"Overdraft Facility" is defined in Section 7.1(i).
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"Participant" is defined in Section 10.4(e).
"PBGC" means the Pension Benefit Guaranty Corporation referred to and
defined in ERISA and any successor entity performing similar functions.
"Person" means any natural person, corporation, limited liability
company, trust, joint venture, association, company, partnership, Governmental
Authority or other entity.
"Plan" means any employee pension benefit plan, as defined in section
3(2) of ERISA, which (i) is currently or hereafter sponsored, maintained or
contributed to by the Borrower, any Subsidiary or an ERISA Affiliate or (ii) was
at any time during the preceding six calendar years sponsored, maintained or
contributed to, by the Borrower, any Subsidiary or an ERISA Affiliate.
"Pledge Agreement" means the Pledge Agreement, dated as of the Closing
Date, substantially in the form of Exhibit F, as amended, supplemented, restated
or otherwise modified from time to time in accordance with the Loan Documents.
"Prime Rate" means the rate of interest per annum publicly announced
from time to time by the Global Administrative Agent as its prime rate in effect
at its principal office in New York City. Without notice to the Borrower or any
other Person, the Prime Rate shall change automatically from time to time as and
in the amount by which said prime rate shall fluctuate. The Prime Rate is a
reference rate and does not necessarily represent the lowest or best rate
actually charged to any customer. The Global Administrative Agent may make
commercial loans and other loans at rates of interest at, above or below the
Prime Rate. For purposes of this Agreement, any change in the Alternate Base
Rate due to a change in the Prime Rate shall be effective on the date such
change in the Prime Rate is announced.
"Production Payments" means a production payment obligation (whether
volumetric or dollar denominated) of the Borrower or any of its Subsidiaries
which are payable from a specified share of proceeds received from production
from specified Oil and Gas Properties, together with all undertakings and
obligations in connection therewith.
"Property" means any interest in any kind of property or asset, whether
real, personal or mixed, or tangible or intangible.
"Proven Reserves" means collectively, "proved oil and gas reserves,"
"proved developed producing oil and gas reserves," "proved developed
non-producing oil and gas reserves" (consisting of proved developed shut-in oil
and gas reserves and proved developed behind pipe oil and gas reserves), and
"proved undeveloped oil and gas reserves," as such terms are defined by the SEC
in its standards and guidelines.
"Register" has the meaning set forth in Section 10.4(c).
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"Regulation U" means any of Regulations U or X of the Board from time
to time in effect and shall include any successor or other regulations or
official interpretations of the Board or any successor Person relating to the
extension of credit for the purpose of purchasing or carrying Margin Stock and
which is applicable to member banks of the Federal Reserve System or any
successor Person.
"Related Parties" means, with respect to any specified Person, such
Person's Affiliates and the respective directors, officers, employees, agents
and advisors of such Person and such Person's Affiliates.
"Required Lenders" means Combined Lenders holding "Loans" (as defined
in the Canadian Term Credit Agreement) and Combined Revolving Commitments (or
Combined Revolving Credit Exposure, as applicable) in the aggregate greater than
50% of the sum of (i) the aggregate unpaid principal amount of the Equivalent
Amount in U.S. Dollars of the "Loans" (as defined in the Canadian Term Credit
Agreement) and (ii) the aggregate Combined Revolving Commitments under the
Combined Loan Documents, or, if the Combined Revolving Commitments have been
terminated, the aggregate Combined Revolving Credit Exposure under the Combined
Loan Documents.
"Reserve Report" means the Initial Reserve Report and any other Reserve
Report(s) delivered pursuant to Section 2.7, in form and substance reasonably
satisfactory to the Global Administrative Agent, prepared at the sole cost and
expense of the Borrower by (i) an Approved Engineer or (ii) the Borrower's chief
petroleum engineer and reviewed by an Approved Engineer, in each case, for which
the Approved Engineer shall certify, in writing, that such Reserve Report was
prepared in accordance with the normal and customary methods and procedures used
by such Approved Engineer for evaluating oil and gas reserves. Each Reserve
Report shall evaluate the Proven Reserves and probable reserves attributable to
the Oil and Gas Properties owned directly by the Borrower and/or its
Subsidiaries, as of the immediately preceding December 31 or the date requested
by the Global Administrative Agent as provided in Section 5.7(b). Each Reserve
Report shall set forth volumes, projections of the future rate of production,
Hydrocarbons prices, escalation rates, discount rate assumptions, and net
proceeds of production, present value of the net proceeds of production,
operating expenses and capital expenditures, in each case based upon updated
economic assumptions reasonably acceptable to the Global Administrative Agent.
"Retex" means Retex Inc., a corporation organized under the laws of the
State of Wyoming.
"Revolving Borrowing Base" means an amount equal to the Global
Borrowing Base less the aggregate amount of the "Loans" (as defined in the
Canadian Term Credit Agreement) outstanding pursuant to the Canadian Term Credit
Agreement.
"Revolving Borrowing Base Allocation Notice" is defined in Section
2.7(d)(iii).
"Revolving Borrowing Base Deficiency" means the amount by which (a) the
Combined Revolving Credit Exposure exceeds (b) the then current Revolving
Borrowing Base.
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"S&P" means Standard & Poor's and any successor thereto that is a
nationally-recognized rating agency.
"SEC" means the Securities and Exchange Commission in the United States
and any successor Governmental Authority.
"Security Documents" means the Pledge Agreement, the Guaranties, each
of the Canadian Security Documents and each other security agreement or other
instrument or document executed and delivered pursuant to Section 4.1 or
pursuant to the Loan Documents to secure any of the Obligations.
"Solvent" means, with respect to any Person at any time, a condition
under which (a) the fair saleable value of such Person's assets is, on the date
of determination, greater than the total amount of such Person's liabilities
(including contingent and unliquidated liabilities) at such time; and (b) such
Person is able to pay all of its liabilities as such liabilities mature. For
purposes of this definition (i) the amount of a Person's contingent or
unliquidated liabilities at any time shall be that amount which, in light of all
the facts and circumstances then existing, represents the amount which can
reasonably be expected to become an actual or matured liability, (ii) the "fair
saleable value" of an asset shall be the amount which may be realized within a
reasonable time either through collection or sale of such asset at its regular
market value, and (iii) the "regular market value" of an asset shall be the
amount which a capable and diligent business person could obtain for such asset
from an interested buyer who is willing to purchase such asset under ordinary
selling conditions.
"Statutory Reserve Rate" means a fraction (expressed as a decimal), the
numerator of which is the number one and the denominator of which is the number
one minus the aggregate of the applicable maximum reserve percentages (including
any basic, marginal, special, emergency or supplemental reserves) expressed as a
decimal established by the Board to which the Global Administrative Agent is
subject with respect to the Adjusted LIBO Rate, for eurocurrency funding
(currently referred to as "Eurocurrency Liabilities" in Regulation D of the
Board). Such reserve percentages shall include those imposed pursuant to
Regulation D. Eurodollar Loans shall be deemed to constitute eurocurrency
fundings and to be subject to such reserve requirements without benefit of or
credit for proration, exemptions or offsets that may be available from time to
time to any Lender under such Regulation D or any comparable regulation. The
Statutory Reserve Rate shall be adjusted automatically on and as of the
effective date of any change in any reserve percentage.
"Stellarton" means Stellarton Energy Corporation, a corporation
organized under the laws of the Province of Alberta, Canada and which was
amalgamated with TBRL on January 31, 2001.
"Stellarton Credit Facility" means that certain revolving credit
facility consisting of the following documents: (a) that certain accepted
Offering Letter from National Bank of Canada to Stellarton, dated April 12,
2000, as amended by (i) that certain Amendment to Offering Letter dated as of
April 12, 2000, dated as of August 4, 2000, by National Bank of Canada to
Stellarton, and (ii) that certain Amendment to Offering Letter dated as of April
12, 2000, dated as of November 6,
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2000, by National Bank of Canada to Stellarton, (b) that certain Fixed and
Floating Charge Demand Debenture and Negative Pledge, dated as of October 17,
1996, between Stellarton and National Bank of Canada, and as supplemented by
that certain First Supplemental Debenture to the Debenture of Stellarton Energy
Corporation, dated as of October 9, 1998, between Stellarton and the National
Bank of Canada, and (c) that certain Deposit Agreement, dated as of October 17,
1996, by Stellarton in favor of National Bank of Canada.
"Subsidiary" means, with respect to any Person (the "parent") at any
date any corporation, limited liability company, partnership (limited or
general), association or other entity (a) of which securities or other ownership
interests representing more than 50% of the equity or more than 50% of the
ordinary voting power or, in the case of a partnership, more than 50% of the
general partnership interests are, as of such date, owned, controlled or held,
or (b) that is, as of such date, otherwise Controlled, by the parent or one or
more subsidiaries of the parent or by the parent and one or more subsidiaries of
the parent. Unless otherwise indicated herein, each reference to the term
"Subsidiary" means a Subsidiary of the Borrower.
"Super Majority Lenders" means (i) prior to the time that the Combined
Revolving Commitments have been terminated and the Combined Revolving Credit
Exposure has been indefeasibly repaid in full in cash, the Combined Revolving
Lenders holding greater than or equal to 75% of the Combined Revolving
Commitments and (ii) after the Combined Revolving Commitments have been
terminated and the Combined Revolving Credit Exposure has been indefeasibly
repaid in full in cash, the Canadian Term Lenders holding greater than or equal
to 75% of the "Loans" (as defined in the Canadian Term Credit Agreement).
"Tangible Net Worth" means, as at any date, the sum of the following
for the Borrower and its Consolidated Subsidiaries determined (without
duplication) in accordance with GAAP:
(i) all items which would be included under shareholders'
equity on the consolidated balance sheet of the Borrower, minus
(ii) the sum of the following: the book value of all assets of
the Borrower and its Consolidated Subsidiaries which should be
classified as intangibles (without duplication of deductions in respect
of items already deducted in arriving at surplus and retained earnings)
but in any event including as such intangibles the following: goodwill
(excluding the writeup of goodwill in connection with the Acquisition
of Stellarton), research and development costs, trademarks, trade
names, copyrights, patents and franchises, unamortized debt discount
and expense, all reserves and any writeup in the book value of assets
resulting from a revaluation thereof or resulting from any changes in
GAAP subsequent to December 31, 1999.
"Taxes" means any and all present or future taxes, levies, imposts,
duties, deductions, charges or withholdings imposed by any Governmental
Authority.
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"TBF" means ▇▇▇ ▇▇▇▇▇ Resources Funding Corp., an unlimited liability
company organized under the laws of the Province of Nova Scotia, Canada.
"TBF Documents" means (i) the TBF/TBRL Funding Agreement, (ii) that
certain Subscription Agreement dated as of the Global Effective Date between
TBRL and the Borrower, (iii) that certain Preferred Stock Purchase Agreement
dated as of the Global Effective Date between TBF and Borrower and (iv) that
certain letter agreement between the Borrower and TBF in respect of its
Guarantee of the obligations of TBF under the Combined Loan Documents, each as
amended, modified, supplemented, waived or replaced from time to time.
"TBF/TBRL Funding Agreement" means that certain Term Debenture issued
as of the Global Effective Date by TBRL to TBF and due March 20, 2021.
"TBRL" means ▇▇▇ ▇▇▇▇▇ Resources Ltd., a corporation organized under
the laws of the Province of Alberta, Canada.
"Type", when used in reference to any Loan or Borrowing, refers to
whether the rate of interest on such Loan, or on the Loans comprising such
Borrowing, is determined by reference to the Adjusted LIBO Rate or the Alternate
Base Rate.
"UCC Searches" means central and local current financing statement or
equivalent Canadian Lien searches from each state in which any Collateral or a
Borrowing Base Property is located, and such other jurisdictions as the Global
Administrative Agent may request, covering the Borrower and each Guarantor
together with copies of all financing statements listed in such searches.
"United States" or "U.S." means the United States of America, its fifty
states and the District of Columbia.
"Unutilized Commitment" means, at the time of determination, the amount
by which (a) the lesser of (i) the amount of the Commitment and (ii) the amount
of the Allocated U.S. Borrowing Base as then in effect at such time, exceeds (b)
the amount of the aggregate Credit Exposure of the Lenders at such time.
"Upfront Fee" is defined in Section 2.11(c).
"U.S. Borrowing Base Deficiency" means the amount by which (a) the
aggregate Credit Exposure of the Lenders exceeds (b) the then current Allocated
U.S. Borrowing Base.
"U.S. Documentation Agent" means BNP Paribas, in its capacity as U.S.
documentation agent for the Lenders hereunder.
"U.S. Syndication Agent" means U.S. Bank National Association, in its
capacity as U.S. syndication agent for the Lenders hereunder.
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"Wholly-Owned Subsidiary" means, as to any Person, any Subsidiary of
which all of the outstanding shares of Equity Interests (other than directors'
qualifying shares) on a fully-diluted basis, are owned by such Person or one or
more of its Wholly-Owned Subsidiaries or by such Person and one or more of its
Wholly-Owned Subsidiaries. Unless otherwise indicated, each reference to the
"Wholly-Owned Subsidiary" means a Wholly-Owned Subsidiary of the Borrower.
SECTION 1.2. Classification of Loans and Borrowings. For purposes of
this Agreement, Loans and Borrowings may be classified and referred to by Type
(e.g., a "Eurodollar Loan" or "Eurodollar Borrowing").
SECTION 1.3. Terms Generally. The definitions of terms herein shall
apply equally to the singular and plural forms of the terms defined. Whenever
the context may require, any pronoun shall include the corresponding masculine,
feminine and neuter forms. The words "include", "includes" and "including" shall
be deemed to be followed by the phrase "without limitation". The word "will"
shall be construed to have the same meaning and effect as the word "shall".
Unless the context requires otherwise (a) any definition of or reference to any
agreement, instrument or other document herein shall be construed as referring
to such agreement, instrument or other document as from time to time amended,
supplemented or otherwise modified (subject to any restrictions on such
amendments, supplements or modifications set forth herein), (b) any reference
herein to any Person shall be construed to include such Person's successors and
assigns, provided such successors and assigns are permitted by the Loan
Documents, (c) the words "herein", "hereof" and "hereunder", and words of
similar import, shall be construed to refer to this Agreement in its entirety
and not to any particular provision hereof, and (d) all references herein to
Articles, Sections, Exhibits and Schedules shall be construed to refer to
Articles and Sections of, and Exhibits and Schedules to, this Agreement.
SECTION 1.4. Accounting Terms; GAAP. Except as otherwise expressly
provided herein, all terms of an accounting or financial nature shall be
construed in accordance with GAAP, as in effect from time to time; provided
that, if the Borrower notifies the Global Administrative Agent that the Borrower
requests an amendment to any provision hereof to eliminate the effect of any
change occurring after the date of this Agreement in GAAP or in the application
thereof on the operation of such provision (or if the Global Administrative
Agent notifies the Borrower that the Required Lenders request an amendment to
any provision hereof for such purpose), regardless of whether any such notice is
given before or after such change in GAAP or in the application thereof, then
such provision shall be interpreted on the basis of GAAP as in effect and
applied immediately before such change shall have become effective until such
notice shall have been withdrawn or such provision amended in accordance
herewith.
ARTICLE II
The Credits
SECTION 2.1. Commitments. Subject to the terms and conditions set forth
herein, each Lender agrees to make Loans in U.S. Dollars to the Borrower from
time to time during the Availability Period in an aggregate principal amount
that will not result in (a) the Credit Exposure
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of any Lender exceeding the Commitment of such Lender, or (b) the aggregate
amount of the Credit Exposure of all Lenders exceeding the lesser of (i) the
aggregate amount of the Allocated U.S. Borrowing Base then in effect and (ii)
the aggregate amount of the Commitments of the Lenders. Within the foregoing
limits and subject to the terms and conditions set forth herein, the Borrower
may borrow, prepay and reborrow Loans.
SECTION 2.2. Loans and Borrowings.
(a) Each Loan shall be made as part of a Borrowing consisting of Loans
made by the Lenders ratably in accordance with their respective Applicable
Percentages. The failure of any Lender to make any Loan required to be made by
it shall not relieve any other Lender of its obligations hereunder; provided
that the Commitments of the Lenders are several and no Lender shall be
responsible for any other Lender's failure to make Loans as required.
(b) Subject to Sections 2.13 and 2.14, each Borrowing shall be
comprised entirely of ABR Loans or Eurodollar Loans as the Borrower may request
in accordance herewith. Each Lender at its option may make any Eurodollar Loan
by causing any domestic or foreign branch or Affiliate of such Lender to make
such Loan; provided that any exercise of such option shall not affect the
obligation of the Borrower to repay such Loan in accordance with the terms of
this Agreement.
(c) At the commencement of each Interest Period for any Eurodollar
Borrowing, such Borrowing shall be in an aggregate amount that is an integral
multiple of U.S.$1,000,000 and not less than U.S.$1,000,000 (including any
continuation or conversion of existing Loans made in connection therewith). At
the time that each ABR Borrowing is made, such Borrowing shall be in an
aggregate amount that is an integral multiple of U.S.$500,000 and not less than
U.S.$500,000 (including any continuation or conversion of existing Loans made in
connection therewith); provided that an ABR Borrowing may be in an aggregate
amount that is equal to the entire Unutilized Commitment, if less. Borrowings of
more than one Type may be outstanding at the same time; provided that there
shall not at any time be more than a total of seven (7) Eurodollar Borrowings
outstanding.
(d) Notwithstanding any other provision of this Agreement, the Borrower
shall not be entitled to request, or to elect to convert or continue, any
Eurodollar Borrowing if the Interest Period requested with respect thereto would
end after the Maturity Date.
SECTION 2.3. Requests for Borrowings. To request a Borrowing, the
Borrower shall notify the Global Administrative Agent of such request by
telephone (a) in the case of a Eurodollar Borrowing, not later than 2:00 p.m.,
New York City time, three Business Days before the date of the proposed
Borrowing or (b) in the case of an ABR Borrowing, not later than 11:00 a.m., New
York City time, on the date of the proposed Borrowing. Each such telephonic
Borrowing Request shall be irrevocable and shall be confirmed promptly by hand
delivery or telecopy to the Global Administrative Agent of a written Borrowing
Request executed by an Authorized Officer of the Borrower, substantially in the
form of Exhibit E-1 or otherwise in a form approved by the Global
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Administrative Agent. Each such telephonic and written Borrowing Request shall
specify the following information in compliance with Section 2.2:
(i) the aggregate amount of the requested Borrowing;
(ii) the date of such Borrowing, which shall be a Business
Day;
(iii) whether such Borrowing is to be an ABR Borrowing or a
Eurodollar Borrowing; and
(iv) in the case of a Eurodollar Borrowing, the initial
Interest Period to be applicable thereto, which shall be a period
contemplated by the definition of the term "Interest Period".
If no election as to the Type of Borrowing is specified, then the requested
Borrowing shall be an ABR Borrowing. If no Interest Period is specified with
respect to any requested Eurodollar Borrowing, then the Borrower shall be deemed
to have selected an Interest Period of one month's duration. Promptly following
receipt of a Borrowing Request in accordance with this Section, the Global
Administrative Agent shall advise each Lender of the details thereof and of the
amount of such Lender's Loan to be made as part of the requested Borrowing.
SECTION 2.4. Letters of Credit.
(a) General. Subject to the terms and conditions set forth herein, the
Borrower may request the issuance of Letters of Credit for its own account or
the account of any Subsidiary, in a form reasonably acceptable to the Global
Administrative Agent and the Issuing Bank, at any time and from time to time
during the Availability Period. In the event of any inconsistency between the
terms and conditions of this Agreement and the terms and conditions of any form
of letter of credit application or other agreement submitted by the Borrower to,
or entered into by the Borrower with, the Issuing Bank relating to any Letter of
Credit, the terms and conditions of this Agreement shall control.
(b) Notice of Issuance, Amendment, Renewal, Extension; Certain
Conditions. To request the issuance of a Letter of Credit (or the amendment,
renewal or extension of an outstanding Letter of Credit), the Borrower shall
hand deliver or telecopy (or transmit by electronic communication, if
arrangements for doing so have been approved by the Issuing Bank) to an Issuing
Bank and the Global Administrative Agent (reasonably in advance of the requested
date of issuance, amendment, renewal or extension) a notice requesting the
issuance of a Letter of Credit, or identifying the Letter of Credit to be
amended, renewed or extended, and specifying the date of issuance, amendment,
renewal or extension (which shall be a Business Day), the date on which such
Letter of Credit is to expire (which shall comply with paragraph (c) of this
Section), the amount of such Letter of Credit, the name and address of the
beneficiary thereof and such other information as shall be necessary to prepare,
amend, renew or extend such Letter of Credit. If requested by the Issuing Bank,
the Borrower also shall submit a letter of credit application on the Issuing
Bank's
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standard form in connection with any request for a Letter of Credit. A Letter of
Credit shall be issued, amended, renewed or extended only if (and upon issuance,
amendment, renewal or extension of each Letter of Credit the Borrower shall be
deemed to represent and warrant that), after giving effect to such issuance,
amendment, renewal or extension (i) the LC Exposure shall not exceed
U.S.$15,000,000 and (ii) the total Credit Exposure shall not exceed the lesser
of (x) the aggregate Commitments of the Lenders or (y) the Allocated U.S.
Borrowing Base then in effect.
(c) Expiration Date. Each Letter of Credit shall expire at or prior to
the close of business on the earlier of (i) the date one year after the date of
the issuance of such Letter of Credit (or, in the case of any renewal or
extension thereof, one year after such renewal or extension, provided such date
is not beyond the date in clause (ii)) and (ii) five (5) Business Days prior to
the Maturity Date.
(d) Participations. By the issuance of a Letter of Credit (or an
amendment to a Letter of Credit increasing the amount thereof) and without any
further action on the part of the Issuing Bank or the Lenders, the Issuing Bank
hereby grants to each Lender, and each Lender hereby acquires from the Issuing
Bank, a participation in such Letter of Credit equal to such Lender's Applicable
Percentage of the aggregate amount available to be drawn under such Letter of
Credit. In consideration and in furtherance of the foregoing, each Lender hereby
absolutely and unconditionally agrees to pay to the Global Administrative Agent,
for the account of the Issuing Bank, such Lender's Applicable Percentage of each
LC Disbursement made by such Issuing Bank and not reimbursed by the Borrower on
the date due as provided in paragraph (e) of this Section, or of any
reimbursement payment required to be refunded to the Borrower for any reason.
Each Lender acknowledges and agrees that its obligation to acquire
participations pursuant to this paragraph in respect of Letters of Credit is
absolute and unconditional and shall not be affected by any circumstance
whatsoever, including any amendment, renewal or extension of any Letter of
Credit or the occurrence and continuance of a Default or reduction or
termination of the Commitments, and that each such payment shall be made without
any offset, abatement, withholding or reduction whatsoever.
(e) Reimbursement. If an Issuing Bank shall make any LC Disbursement in
respect of a Letter of Credit, the Borrower shall reimburse such LC Disbursement
by paying to the Global Administrative Agent an amount equal to such LC
Disbursement not later than 12:00 noon, New York City time, on the date that
such LC Disbursement is made, if the Borrower shall have received notice of such
LC Disbursement prior to 10:00 a.m., New York City time, on such date, or, if
such notice has not been received by the Borrower prior to such time on such
date, then not later than 12:00 noon, New York City time, on (i) the Business
Day that the Borrower receives such notice, if such notice is received prior to
10:00 a.m., New York City time, on the day of receipt, or (ii) the Business Day
immediately following the day that the Borrower receives such notice, if such
notice is not received prior to such time on the day of receipt; provided that,
unless such LC Disbursement is less than U.S.$500,000, the Borrower may, subject
to the conditions to Borrowing set forth herein, request in accordance with
Section 2.3 that such payment be financed with a Borrowing in an equivalent
amount and, to the extent so financed, the Borrower's obligation to make such
payment shall be discharged and replaced by the resulting Borrowing. If the
Borrower fails to make such payment when due, the Global Administrative Agent
shall notify each Lender of the applicable LC
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Disbursement, the payment then due from the Borrower in respect thereof and such
Lender's Applicable Percentage thereof. Promptly following receipt of such
notice, each Lender shall pay to the Global Administrative Agent its Applicable
Percentage of the payment then due from the Borrower, in the same manner as
provided in Section 2.5 with respect to Loans made by such Lender (and Section
2.5 shall apply, mutatis mutandis, to the payment obligations of the Lenders),
and the Global Administrative Agent shall promptly pay to the Issuing Bank the
amounts so received by it from the Lenders. Promptly following receipt by the
Global Administrative Agent of any payment from the Borrower pursuant to this
paragraph, the Global Administrative Agent shall distribute such payment to the
Issuing Bank or, to the extent that Lenders have made payments pursuant to this
paragraph to reimburse the Issuing Bank, then to such Lenders and the Issuing
Bank as their interests may appear. Any payment made by a Lender pursuant to
this paragraph to reimburse the Issuing Bank for any LC Disbursement (other than
the funding of ABR Loans as contemplated above) shall not constitute a Loan and
shall not relieve the Borrower of its obligation to reimburse such LC
Disbursement.
(f) Obligations Absolute. The Borrower's obligation to reimburse LC
Disbursements as provided in paragraph (e) of this Section shall be absolute,
unconditional and irrevocable, and shall be performed strictly in accordance
with the terms of this Agreement under any and all circumstances whatsoever and
irrespective of (i) any lack of validity or enforceability of any Letter of
Credit or this Agreement, or any term or provision therein, (ii) any draft or
other document presented under a Letter of Credit proving to be forged,
fraudulent or invalid in any respect or any statement therein proving to be
untrue or inaccurate in any respect, (iii) payment by an Issuing Bank under a
Letter of Credit against presentation of a draft or other document that does not
comply with the terms of such Letter of Credit, or (iv) any other event or
circumstance whatsoever, whether or not similar to any of the foregoing, that
might, but for the provisions of this Section, constitute a legal or equitable
discharge of, or provide a right of setoff against, the Borrower's obligations
hereunder. Neither the Agents, the Lenders or any Issuing Bank nor any of their
Related Parties shall have any liability or responsibility by reason of or in
connection with the issuance or transfer of any Letter of Credit or any payment
or failure to make any payment thereunder (irrespective of any of the
circumstances referred to in the preceding sentence), or any error, omission,
interruption, loss or delay in transmission or delivery of any draft, notice or
other communication under or relating to any Letter of Credit (including any
document required to make a drawing thereunder), any error in interpretation of
technical terms or any consequence arising from causes beyond the control of
such Issuing Bank; provided that the foregoing shall not be construed to excuse
such Issuing Bank from liability to the Borrower to the extent of any direct or
actual damages (as opposed to special, indirect, consequential or punitive
damages, claims in respect of which are hereby waived by the Borrower to the
extent permitted by applicable law) suffered by the Borrower that are caused by
such Issuing Bank's failure to exercise care when determining whether drafts and
other documents presented under a Letter of Credit comply with the terms
thereof. The parties hereto expressly agree that, in the absence of gross
negligence or wilful misconduct on the part of the Issuing Bank (as finally
determined by a court of competent jurisdiction), the Issuing Bank shall be
deemed to have exercised care in each such determination. In furtherance of the
foregoing and without limiting the generality thereof, the parties agree that,
with respect to documents presented which appear on their face to be in
substantial compliance with the terms of a Letter of Credit, the
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Issuing Bank may, in its sole discretion, either accept and make payment upon
such documents without responsibility for further investigation, regardless of
any notice or information to the contrary, or refuse to accept and make payment
upon such documents if such documents are not in strict compliance with the
terms of such Letter of Credit.
(g) Disbursement Procedures. An Issuing Bank shall, promptly following
its receipt thereof, examine all documents purporting to represent a demand for
payment under a Letter of Credit. Such Issuing Bank shall promptly notify the
Global Administrative Agent and the Borrower by telephone (confirmed by
telecopy) of such demand for payment and whether such Issuing Bank has made or
will make an LC Disbursement thereunder; provided that any failure to give or
delay in giving such notice shall not relieve the Borrower of its obligation to
reimburse such Issuing Bank and the Lenders with respect to any such LC
Disbursement.
(h) Interim Interest. If an Issuing Bank shall make any LC
Disbursement, then, unless the Borrower shall reimburse such LC Disbursement in
full on the date such LC Disbursement is made, the unpaid amount thereof shall
bear interest, for each day from and including the date such LC Disbursement is
made to but excluding the date that the Borrower reimburses such LC
Disbursement, at the rate per annum then applicable to ABR Loans; provided that,
if the Borrower fails to reimburse such LC Disbursement within two (2) Business
Days after such reimbursement is due pursuant to paragraph (e) of this Section,
then Section 2.12(c) shall apply. Interest accrued pursuant to this paragraph
shall be for the account of the Issuing Bank, except that interest accrued on
and after the date of payment by any Lender pursuant to paragraph (e) of this
Section to reimburse the Issuing Bank shall be for the account of such Lender to
the extent of such payment.
(i) Cash Collateralization. If any Event of Default shall occur and be
continuing, on the Business Day that the Borrower receives notice from the
Global Administrative Agent or the Majority Lenders demanding the deposit of
cash collateral pursuant to this paragraph, the Borrower shall deposit in an
account with the Global Administrative Agent, in the name of the Global
Administrative Agent and for the benefit of the Lenders, an amount in cash equal
to the LC Exposure as of such date plus any accrued and unpaid interest thereon;
provided that the obligation to deposit such cash collateral shall become
effective immediately, and such deposit shall become immediately due and
payable, without demand or other notice of any kind, upon the occurrence of any
Event of Default with respect to the Borrower described in Section 8.1(g). The
Borrower also shall deposit cash collateral pursuant to this paragraph as and to
the extent required by Section 2.10, and any such cash collateral so deposited
and held by the Global Administrative Agent hereunder shall constitute part of
the Global Borrowing Base for purposes of determining compliance with Section
2.10. Each such deposit shall be held by the Global Administrative Agent as
collateral for the payment and performance of the obligations of the Borrower
under this Agreement. The Global Administrative Agent shall have exclusive
dominion and control, including the exclusive right of withdrawal, over such
account. Other than any interest earned on the investment of such deposits,
which investments shall be made at the option and sole discretion of the Global
Administrative Agent and at the Borrower's risk and expense, such deposits shall
not bear interest. Interest or profits, if any, on such investments shall
accumulate in such account. Moneys in such account shall be applied by the
Global Administrative Agent to reimburse the Issuing Bank for LC Disbursements
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for which it has not been reimbursed and, to the extent not so applied, shall be
held for the satisfaction of the reimbursement obligations of the Borrower for
the LC Exposure at such time or, if the maturity of the Loans has been
accelerated (but subject to the consent of Lenders with LC Exposure representing
greater than 50% of the total LC Exposure), be applied to satisfy other
obligations of the Borrower under this Agreement. If the Borrower is required to
provide an amount of cash collateral hereunder as a result of the occurrence of
an Event of Default, such amount (to the extent not applied as aforesaid) shall
be returned to the Borrower within three (3) Business Days after all Events of
Default have been cured or waived. If the Borrower is required to provide an
amount of cash collateral hereunder pursuant to Section 2.10, such amount (to
the extent not applied as aforesaid) shall be returned to the Borrower as and to
the extent that, after giving effect to such return, the Borrower would remain
in compliance with Section 2.10 and no Default shall have occurred and be
continuing.
SECTION 2.5. Funding of Borrowings.
(a) Each Lender shall make each Loan to be made by it hereunder on the
proposed date thereof by wire transfer of immediately available funds by 12:00
noon, New York City time, to the account of the Global Administrative Agent most
recently designated by it for such purpose by notice to the Lenders. The Global
Administrative Agent will make such Loans available to the Borrower by promptly
crediting the amounts so received, in like funds, to an account of the Borrower
maintained with the Global Administrative Agent in New York City; provided that
ABR Loans made to finance the reimbursement of an LC Disbursement as provided in
Section 2.4(e) shall be remitted by the Global Administrative Agent to the
applicable Issuing Bank.
(b) Unless the Global Administrative Agent shall have received notice
from a Lender prior to the proposed date of any Borrowing that such Lender will
not make available to the Global Administrative Agent such Lender's share of
such Borrowing, the Global Administrative Agent may assume that such Lender has
made such share available on such date in accordance with paragraph (a) of this
Section and may, in reliance upon such assumption, make available to the
Borrower a corresponding amount. In such event, if a Lender has not in fact made
its share of the applicable Borrowing available to the Global Administrative
Agent, then the applicable Lender and the Borrower severally agree to pay to the
Global Administrative Agent forthwith on demand such corresponding amount with
interest thereon, for each day from and including the date such amount is made
available to the Borrower to but excluding the date of payment to the Global
Administrative Agent, at (i) in the case of such Lender, the greater of (A) the
Federal Funds Effective Rate or (B) a rate determined by the Global
Administrative Agent in accordance with banking industry rules on interbank
compensation or (ii) in the case of the Borrower, the interest rate applicable
to Loans made in such Borrowing. If such Lender pays such amount to the Global
Administrative Agent, then such amount shall constitute such Lender's Loan
included in such Borrowing.
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SECTION 2.6. Interest Elections.
(a) Each Borrowing initially shall be of the Type specified in the
applicable Borrowing Request (or an ABR Borrowing if no Type is specified) and,
in the case of a Eurodollar Borrowing, shall have an initial Interest Period as
specified in such Borrowing Request (or one month if no Interest Period is
specified). Thereafter, the Borrower may elect to convert such Borrowing to a
different Type or to continue such Borrowing and, in the case of a Eurodollar
Borrowing, may elect Interest Periods therefor, all as provided in this Section.
The Borrower may, subject to the requirements of Section 2.2(c), elect different
options with respect to different portions of the affected Borrowing, in which
case each such portion shall be allocated ratably among the Lenders holding the
Loans comprising such Borrowing, and the Loans comprising each such portion
shall be considered a separate Borrowing.
(b) To make an election pursuant to this Section, the Borrower shall
notify the Global Administrative Agent of such election by telephone by the time
that a Borrowing Request would be required under Section 2.3 if the Borrower
were requesting a Borrowing of the Type resulting from such election to be made
on the effective date of such election. Each such telephonic Interest Election
Request shall be irrevocable and shall be confirmed promptly by hand delivery or
telecopy to the Global Administrative Agent of a written Interest Election
Request executed by an Authorized Officer of the Borrower, substantially in the
form of Exhibit E-2 or otherwise in a form approved by the Global Administrative
Agent.
(c) Each telephonic and written Interest Election Request shall specify
the following information in compliance with Section 2.2:
(i) the Borrowing to which such Interest Election Request
applies and, if different options are being elected with respect to
different portions thereof, the portions thereof to be allocated to
each resulting Borrowing (in which case the information to be specified
pursuant to clauses (iii) and (iv) below shall be specified for each
resulting Borrowing);
(ii) the effective date of the election made pursuant to such
Interest Election Request, which shall be a Business Day;
(iii) whether the resulting Borrowing is to be an ABR
Borrowing or a Eurodollar Borrowing; and
(iv) if the resulting Borrowing is a Eurodollar Borrowing, the
Interest Period to be applicable thereto after giving effect to such
election, which shall be a period contemplated by the definition of the
term "Interest Period".
If any such Interest Election Request requests a Eurodollar Borrowing but does
not specify an Interest Period, then the Borrower shall be deemed to have
selected an Interest Period of one month's duration.
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(d) Promptly following receipt of an Interest Election Request, the
Global Administrative Agent shall advise each Lender of the details thereof and
of such Lender's portion of each resulting Borrowing.
(e) If the Borrower fails to deliver a timely Interest Election Request
with respect to a Eurodollar Borrowing prior to the end of the Interest Period
applicable thereto, then, unless such Borrowing is repaid as provided herein, at
the end of such Interest Period such Borrowing shall be converted to an ABR
Borrowing. Notwithstanding any contrary provision hereof, if an Event of Default
has occurred and is continuing and the Global Administrative Agent, at the
request of the Required Lenders, so notifies the Borrower, then, so long as such
Event of Default is continuing, (i) no outstanding Borrowing may be converted to
or continued as a Eurodollar Borrowing and (ii) unless the Obligations have been
accelerated pursuant to Section 8.3, each Eurodollar Borrowing shall be
converted to an ABR Borrowing at the end of the Interest Period applicable
thereto.
SECTION 2.7. Global Borrowing Base.
(a) Initial Global Borrowing Base. During the period from the date
hereof to the date of the first redetermination of the Global Borrowing Base
pursuant to the provisions of this Section, the initial amount of the Global
Borrowing Base has been determined by the Global Administrative Agent and
acknowledged by the Borrower and its Subsidiaries (including the Canadian
Borrowers) and agreed to by the Combined Lenders to be U.S.$300,000,000.
(b) Annual Scheduled Determinations of the Global Borrowing Base.
Promptly after January 1 of each calendar year (commencing January 1, 2002), and
in any event prior to March 1 of each calendar year, the Borrower shall furnish
to the Global Administrative Agent and the Combined Lenders a Reserve Report in
form and substance reasonably satisfactory to the Global Administrative Agent,
which report shall evaluate as of December 31 of the immediately preceding
calendar year the Proven Reserves attributable to the Oil and Gas Properties
which the Borrower wishes to include in the Global Borrowing Base and a
projection of the rate of production and net operating income with respect
thereto, as of such date, together with additional data concerning pricing,
hedging, operating costs and quantities of production, and other information and
engineering and geological data as the Global Administrative Agent or any
Combined Lender may reasonably request. Within 30 days after receipt of such
report and information, the Global Administrative Agent shall make an initial
determination of the amount of credit to be made available to the Borrower
hereunder, and shall promptly notify the Combined Lenders in writing of the
Global Administrative Agent's initial determination of the Global Borrowing
Base. The Global Administrative Agent shall make such determination in
accordance with its customary practices and standards for oil and gas loans and
in the exercise of its sole discretion. Within 15 days following their receipt
of the proposed amount for the redetermined Global Borrowing Base, (x) the Super
Majority Lenders if the proposed amount is an increase or (y) the Majority
Lenders if the proposed amount is a decrease or maintenance, shall approve or
reject the Global Administrative Agent's initial determination of the Global
Borrowing Base by written notice to the Global Administrative Agent; provided,
however that failure by any Combined Lender to reject in writing the Global
Administrative Agent's determination of the Global Borrowing Base within said 15
day period shall
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be deemed an acceptance of such determination by such Combined Lender. If the
Super Majority Lenders or the Majority Lenders, as applicable, fail to approve
any such determination of the Global Borrowing Base made by the Global
Administrative Agent hereunder, then the Global Administrative Agent shall poll
the Combined Lenders and the Global Borrowing Base shall be set at the highest
amount on which the Super Majority Lenders if such number would result in an
increase in the Global Borrowing Base or otherwise, the Majority Lenders, can
agree, it being understood that a Combined Lender is deemed to have agreed to
any and all amounts that are lower than the amount actually determined by such
Combined Lender to be the appropriate value of the Global Borrowing Base. Upon
approval or deemed approval by the Super Majority Lenders or the Majority
Lenders, as applicable, of the Global Borrowing Base, the Global Administrative
Agent upon notice thereof shall, by written notice to the Borrower, and the
Combined Lenders, designate the new Global Borrowing Base available to the
Borrower, the Canadian Revolving Borrowers and the Canadian Term Borrower (each
such notice in this Section 2.7(b) below, herein a "Global Borrowing Base
Designation Notice"). If the Combined Revolving Commitments are in effect and/or
any Combined Revolving Obligation is outstanding, then the Global Borrowing Base
Designation Notice shall also set forth the then applicable Revolving Borrowing
Base. If the Combined Revolving Commitments are in effect and/or any Combined
Revolving Obligation is outstanding, then upon receipt of such Global Borrowing
Base Designation Notice, the Borrower shall designate the Allocated U.S.
Borrowing Base and the Allocated Canadian Borrowing Base to the Global
Administrative Agent in accordance with Section 2.7(d).
(c) [Intentionally blank].
(d) Allocation of the Revolving Borrowing Base. For so long as any of
the Combined Revolving Commitments are in effect and/or any Combined Revolving
Obligation is outstanding, then the Revolving Borrowing Base shall be comprised
of the Allocated U.S. Borrowing Base and the Allocated Canadian Borrowing Base,
and allocations between the Allocated U.S. Borrowing Base and Allocated Canadian
Borrowing Base shall be made in accordance with this Section 2.7(d).
(i) The "Allocated U.S. Borrowing Base" means, as of any date,
the amount in U.S. Dollars designated or determined as such from time
to time (A) by the Borrower pursuant to a Revolving Borrowing Base
Allocation Notice delivered in accordance with Section 2.7(d)(iii) or
(iv) of this Agreement or (B) in accordance with the other provisions
of this Agreement. The Allocated U.S. Borrowing Base shall represent
the maximum amount of credit in the form of Loans and Letters of Credit
(subject to the aggregate Commitments and subject to the other
provisions thereof) that the Lenders will extend to the Borrower at any
one time prior to the Maturity Date. On the date of this Agreement, the
initial Allocated U.S. Borrowing Base shall be U.S.$120,000,000.
(ii) The "Allocated Canadian Borrowing Base" means, as of any
date, the Equivalent Amount in U.S. Dollars designated as such from
time to time (A) by the Borrower pursuant to a Revolving Borrowing Base
Allocation Notice delivered in accordance with Section 2.7(d)(iii) or
(iv) of this Agreement or (B) in accordance with the other provisions
of this Agreement. The Allocated Canadian Borrowing Base shall
represent
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the maximum amount of credit in the form of "Loans", "Letters of
Credit" and "Bankers' Acceptances" in each case as defined in the
Canadian Revolving Credit Agreement (subject to the aggregate
"Commitments" as defined in the Canadian Revolving Credit Agreement and
subject to the other provisions thereof) that the Canadian Revolving
Lenders will extend to the Canadian Revolving Borrowers at any one time
prior to the "Maturity Date" as defined in the Canadian Revolving
Credit Agreement. On the date of this Agreement, the initial Allocated
Canadian Borrowing Base shall be U.S.$85,000,000.
(iii) Upon receipt of the Global Borrowing Base Designation
Notice and the Revolving Borrowing Base set forth therein, the Borrower
shall specify within ten (10) days of its receipt thereof the
allocation of the Revolving Borrowing Base between the Allocated U.S.
Borrowing Base and the Allocated Canadian Borrowing Base by providing a
written notice to the Global Administrative Agent of such allocation
(each such notice herein a "Revolving Borrowing Base Allocation
Notice"); provided that the sum of the Allocated U.S. Borrowing Base
and the Allocated Canadian Borrowing Base shall at all times be equal
to the Revolving Borrowing Base. In the event that the Borrower fails
to provide the Global Administrative Agent with a Revolving Borrowing
Base Allocation Notice within the period required by this Section
2.7(d)(iii), the Revolving Borrowing Base will be allocated in same
proportion as existed prior to such redetermination. Promptly upon the
allocation of the Revolving Borrowing Base between the Allocated U.S.
Borrowing Base and the Allocated Canadian Borrowing Base in accordance
with the procedures set forth above, the Global Administrative Agent
shall provide a written notice to the Combined Revolving Lenders and
the Borrower, which written notice shall set forth the Allocated U.S.
Borrowing Base and the Allocated Canadian Borrowing Base to be in
effect. Any designation of the Allocated U.S. Borrowing Base or the
Allocated Canadian Borrowing Base effected pursuant to this Section
2.7(d)(iii) in connection with a determination or redetermination of
the Global Borrowing Base shall be effective as of the date of the
Global Borrowing Base Designation Notice.
(iv) The Borrower shall have the right to request the Combined
Revolving Lenders to increase the Allocated U.S. Borrowing Base and
decrease the Allocated Canadian Borrowing Base, or to increase the
Allocated Canadian Borrowing Base and decrease the Allocated U.S.
Borrowing Base, by providing a written notice to the Global
Administrative Agent and the Combined Revolving Lenders; provided that
the Borrower may change the Allocated U.S. Borrowing Base and/or the
Allocated Canadian Borrowing Base only one (1) time during the period
between scheduled annual redeterminations of the Global Borrowing Base
pursuant to Section 2.7(b) and pursuant to Section 2.10(b)(4). In
connection with such increase or decrease, each Combined Revolving
Lender shall have its share of the Allocated U.S. Borrowing Base or the
Allocated Canadian Borrowing Base, as applicable, increased or
decreased, as the case may be, by an amount in proportion to its
Applicable Percentage (as defined herein, in the case of a Lender, and
as defined in the Canadian Revolving Credit Agreement, in the case of a
Canadian Revolving Lender). The revised Allocated U.S. Borrowing Base
and Allocated Canadian Borrowing Base shall become effective upon the
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delivery by the Global Administrative Agent to the Borrower, the Agents
and the Combined Revolving Lenders of written notice thereof.
(e) Discretionary Determination of the Global Borrowing Base. Each of
(i) the Global Administrative Agent or the Majority Lenders in the event that
Global Borrowing Base Utilization exceeds 50% at any time for a period of 15
consecutive Business Days or (ii) (A) the Borrower or (B) the Global
Administrative Agent, at the request of the Required Lenders, shall have the
right to request in writing a redetermination of the Global Borrowing Base, in
its sole discretion at any time and from time to time, provided, that clause (i)
and clause (ii) may each be the basis of an unscheduled redetermination not more
often than one (1) time during any calendar year. If any Person shall request
discretionary redetermination of the Global Borrowing Base pursuant to the
provisions of this Section 2.7(e), the Borrower shall within 30 days of receipt
of a request therefor from the Global Administrative Agent, deliver to the
Global Administrative Agent a Reserve Report dated as of the date requested in
such notice and such updated engineering, production, operating and other data
as the Global Administrative Agent or any other Combined Lender may reasonably
request. The Super Majority Lenders if such number would result in an increase
in the Global Borrowing Base or otherwise, the Majority Lenders, shall approve
and designate the new Global Borrowing Base in accordance with the procedures
and standards described in Section 2.7(b) and the Borrower shall provide a
Revolving Borrowing Base Allocation Notice to the Global Administrative Agent in
accordance with Section 2.7(d)(iii); provided that in the event that the
Borrower fails to provide such Revolving Borrowing Base Allocation Notice, the
Revolving Borrowing Base shall be allocated between the Allocated U.S. Borrowing
Base and Allocated Canadian Borrowing Base in accordance with Section
2.7(d)(iii).
(f) General Provisions With Respect to the Global Borrowing Base. The
determination of the Global Borrowing Base shall be made by the Global
Administrative Agent and the Super Majority Lenders or Majority Lenders, as
applicable, taking into consideration the estimated value of the Oil and Gas
Properties owned by the Borrower and its Subsidiaries as reflected in the most
recent Reserve Report delivered hereunder and any other relevant information
obtained by or delivered to the Global Administrative Agent or any other
Combined Lender, all in accordance with the other provisions of this Section 2.7
in accordance with their customary practices for oil and gas loans as in effect
from time to time. It is understood by the parties hereto that the Combined
Lenders shall have no commitment or obligation whatsoever to increase the Global
Borrowing Base to any amount in excess of U.S.$300,000,000, and nothing herein
contained shall be construed to be a commitment by the Combined Lenders to so
increase the Global Borrowing Base. The Global Borrowing Base may be
redetermined pursuant to Section 2.7(b) (annual) and Section 2.7(e)
(unscheduled). In connection with any redetermination or adjustment pursuant to
any of the foregoing, if the Global Administrative Agent determines that either
a Global Borrowing Base Deficiency, Revolving Borrowing Base Deficiency or a
U.S. Borrowing Base Deficiency exists, the Global Administrative Agent shall
give written notice thereof to the Borrower and the date such notice is received
shall be the "Deficiency Notification Date".
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SECTION 2.8. Termination and Reduction of Commitments.
(a) Unless previously terminated, the Commitments shall terminate on
the Maturity Date.
(b) The 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 U.S.$1,000,000 and not
less than U.S.$5,000,000 and (ii) the Borrower shall not terminate or reduce the
Commitments if, after giving effect to any concurrent prepayment of the Loans in
accordance with Section 2.10, the aggregate Credit Exposure of the Lenders would
exceed the aggregate Commitments of the Lenders.
(c) The Borrower shall notify the Global Administrative Agent of any
election to terminate or reduce the Commitments under paragraph (b) of this
Section at least two (2) 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 Global Administrative
Agent shall advise the Lenders of the contents thereof. Each notice delivered by
the Borrower pursuant to this Section shall be irrevocable; provided that a
notice of termination of the Commitments delivered by the Borrower may state
that such notice is conditioned upon the effectiveness of other credit
facilities, in which case such notice may be revoked by the Borrower (by notice
to the Global Administrative Agent on or prior to the specified effective date)
if such condition is not satisfied. Subject to the rights of the Borrower under
Section 2.21, 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 Applicable Percentage of the Commitments.
(d) The Borrower will not terminate, or permit to expire, all of the
Commitments under this Agreement prior to (i) the expiration or termination of
the Canadian Revolving Commitments and (ii) the payment and performance in full
of all Canadian Revolving Obligations.
SECTION 2.9. Repayment of Loans; Evidence of Indebtedness.
(a) The Borrower hereby unconditionally promises to pay to the Global
Administrative Agent for the account of each Lender the then unpaid principal
amount of each Loan and Borrowing of such Lender on the Maturity Date.
(b) Each Lender shall maintain in accordance with its usual practice an
account or accounts evidencing the Obligations of the Borrower to such Lender
resulting from each Loan made by such Lender, including the amounts of principal
and interest payable and paid to such Lender from time to time hereunder.
(c) The Global Administrative Agent shall maintain accounts in which it
shall record (i) the amount of each Loan made hereunder, the Type thereof and
the Interest Period applicable thereto, (ii) the amount of any principal or
interest due and payable or to become due and payable from the Borrower to each
Lender hereunder and (iii) the amount of any sum received by the Global
Administrative Agent hereunder for the account of the Lenders and each Lender's
share thereof.
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(d) The entries made in the accounts maintained pursuant to paragraphs
(b) or (c) of this Section shall be prima facie evidence of the existence and
amounts of the obligations recorded therein; provided that the failure of any
Lender or the Global Administrative Agent to maintain such accounts or any error
therein shall not in any manner affect the obligation of the Borrower to repay
the Loans in accordance with the terms of this Agreement.
(e) Any Lender may request that Loans made by it be evidenced by one or
more promissory notes. In such event, the Borrower shall prepare, execute and
deliver to such Lender promissory notes payable to the order of such Lender (or,
if requested by such Lender, to such Lender and its registered assigns and in a
form approved by the Global Administrative Agent). Thereafter, the Loans
evidenced by such promissory notes and interest thereon shall at all times
(including after assignment pursuant to Section 10.4) be represented by one or
more promissory notes in such form payable to the order of the payee named
therein (or, if any such promissory note is a registered note, to such payee and
its registered assigns).
SECTION 2.10. Prepayment of Loans.
(a) The Borrower shall have the right at any time and from time to time
to prepay any Borrowing in whole or in part, subject to the requirements of
Section 2.10(c).
(b) If, (i) either the Global Borrowing Base, Revolving Borrowing Base
or the Allocated U.S. Borrowing Base is (A) redetermined under Section 2.7, (B)
reallocated pursuant to Section 2.7(d), or (C) reduced pursuant to any other
provision of this Agreement, and (ii) as a result thereof, either a Global
Borrowing Base Deficiency, Revolving Borrowing Base Deficiency or a U.S.
Borrowing Base Deficiency occurs, then the Borrower shall take the following
actions:
(1) in the case of a Global Borrowing Base Deficiency or a
Revolving Borrowing Base Deficiency resulting from a
redetermination or reduction of the Global Borrowing Base,
prepay, or cause to be prepaid, (a) Loans and "Loans" under
the Canadian Revolving Credit Agreement in an aggregate
principal amount equal to such deficiency and (b) if such
deficiency is greater than the sum of the outstanding Loans
and "Loans" under the Canadian Revolving Credit Agreement, an
additional amount of "Loans" under the Canadian Term Credit
Agreement, together, in each case, with interest on the
principal amount paid accrued to the date of such prepayment
and, if after prepaying all of the Combined Loans a Global
Borrowing Base Deficiency or a Revolving Borrowing Base
Deficiency remains as a result of an LC Exposure, pay to the
Global Administrative Agent an amount equal to such remaining
Global Borrowing Base Deficiency or Revolving Borrowing Base
Deficiency to be held as cash collateral as provided in
Section 2.4(i); provided that the Borrower shall be obligated
to make (or cause to be made) any such prepayment and/or
deposit of cash collateral within 180 days following the
Deficiency Notification Date with respect to such deficiency,
and provided further that within 90 days following the
Deficiency Notification Date, the Borrower shall have prepaid
(or caused to be prepaid), or
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deposited cash in an amount equal to, one-half of such Global
Borrowing Base Deficiency or Revolving Borrowing Base
Deficiency;
(2) in the case of a U.S. Borrowing Base Deficiency resulting from
a redetermination or reduction of the Global Borrowing Base,
take the action described under clause (1) above (except that
prepayments shall be made in respect of Loans made pursuant to
this Agreement);
(3) in the case of a U.S. Borrowing Base Deficiency resulting from
a reallocation of the Revolving Borrowing Base pursuant to
Section 2.7(d), prepay Loans in an aggregate principal amount
equal to such deficiency, together with interest on the
principal amount paid accrued to the date of such prepayment,
and if a U.S. Borrowing Base Deficiency remains after
prepaying all of the Loans as a result of an LC Exposure, pay
to the Global Administrative Agent an amount equal to such
remaining U.S. Borrowing Base Deficiency to be held as cash
collateral as provided in Section 2.4(i); it being understood
that the Borrower shall be obligated to make such prepayment
and/or deposit of cash collateral on the effective date of
such reallocation; and
(4) notwithstanding anything in this Section 2.10 to the contrary,
in the event that a U.S. Borrowing Base Deficiency exists at a
time when no Revolving Borrowing Base Deficiency exists, then,
to the extent that such action would cure (in whole or in
part) such U.S. Borrowing Base Deficiency, the Borrower may
reallocate the Revolving Borrowing Base between the Allocated
U.S. Borrowing Base and the Allocated Canadian Borrowing Base
by providing the Global Administrative Agent with its election
to do so (which election will designate the relevant
reallocations) on the Business Day on which such U.S.
Borrowing Base Deficiency occurs; provided, however, that no
reallocation shall be permitted to the extent such
reallocation would cause the aggregate "Credit Exposure" of
the Canadian Revolving Lenders under the Canadian Revolving
Credit Agreement to be greater than the lesser of the
aggregate "Commitments" thereunder and the Allocated Canadian
Borrowing Base.
(c) The Borrower shall notify the Global Administrative Agent by
telephone (confirmed by telecopy) of any prepayment hereunder (i) in the case of
prepayment of a Eurodollar Borrowing, not later than 1:00 p.m., New York City
time, two Business Days before the date of prepayment or (ii) in the case of
prepayment of an ABR Borrowing, not later than 11:00 a.m., New York City time,
on the date of prepayment. Each such notice shall be irrevocable and shall
specify the prepayment date and the principal amount of each Borrowing or
portion thereof to be prepaid (which amount shall be in a minimum principal
amount of U.S.$1,000,000 and in U.S.$1,000,000 increments in excess thereof);
provided that, if a notice of prepayment is given in connection with a
conditional notice of termination of the Commitments as contemplated by Section
2.8, then such notice of prepayment may be revoked if such notice of termination
is revoked in accordance with Section 2.8. Promptly following receipt of any
such notice relating to a Borrowing, the Global Administrative Agent shall
advise the Lenders of the contents thereof. Each partial prepayment of any
Borrowing
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shall be in an amount that would be permitted in the case of an advance of a
Borrowing of the same Type as provided in Section 2.2. Each prepayment of a
Borrowing shall be applied ratably to the Loans included in the prepaid
Borrowing. Prepayments shall be accompanied by accrued interest to the extent
required by Section 2.12 and by any other amounts then due under this Agreement
(including all amounts due under Section 2.16).
SECTION 2.11. Fees.
(a) The Borrower agrees to pay to the Global Administrative Agent for
the account of each Lender a commitment fee (the "Commitment Fee"), which shall
accrue at the Applicable Rate on the daily amount equal to the Applicable
Percentage of such Lender of the Unutilized Commitment during the period from
and including the Global Effective Date to but excluding the date on which the
Commitments terminate. Accrued Commitment Fees shall be payable in arrears on
the last day of March, June, September and December of each year and on the date
on which the Commitments terminate, commencing on the first such date to occur
after the date of this Agreement; provided that any Commitment Fees accruing
after the date on which the Commitments terminate shall be payable on demand.
All Commitment Fees shall be computed on the basis of a year of 360 days and
shall be payable for the actual number of days elapsed (including the first day
but excluding the last day).
(b) The Borrower agrees to pay (i) to the Global Administrative Agent
for the account of each Lender a participation fee with respect to its
participations in Letters of Credit, which shall accrue at the same Applicable
Rate as interest on Eurodollar Loans on the average daily amount of such
Lender's Applicable Percentage of the LC Exposure (excluding any portion thereof
attributable to unreimbursed LC Disbursements) during the period from and
including the date of this Agreement to but excluding the later of the date on
which the Commitments terminate and the date on which the Lenders cease to have
any LC Exposure, and (ii) to the Issuing Bank a fronting fee equal to the
greater of (A) U.S.$500 and (B) the rate of 0.125% per annum on the average
daily amount of the LC Exposure (excluding any portion thereof attributable to
unreimbursed LC Disbursements) during the period from and including the date of
this Agreement to but excluding the later of the date of termination of the
Commitments and the date on which there ceases to be any LC Exposure, as well as
the Issuing Bank's standard fees with respect to the administration, issuance,
amendment, renewal or extension of any Letter of Credit or processing of
drawings thereunder. Participation fees and fronting fees shall be payable in
arrears on the last day of each March, June, September and December of each
year, commencing on the first such date to occur after the date of this
Agreement; provided that all such fees shall be payable on the date on which the
Commitments terminate and any such fees accruing after the date on which the
Commitments terminate shall be payable on demand. Any other fees payable to the
Issuing Bank pursuant to this paragraph shall be payable within ten (10) days
after demand. All participation fees and fronting fees shall be computed on the
basis of a year of 360 days and shall be payable for the actual number of days
elapsed (including the first day but excluding the last day).
(c) The Borrower agrees to pay to the Global Administrative Agent, for
its own account and for the account of each Lender, as applicable, fees,
including, without limitation, an upfront fee
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(the "Upfront Fee"), in the amounts and at the times separately agreed upon
between the Borrower and the Global Administrative Agent, including, without
limitation, the amounts agreed upon between the Borrower and the Global
Administrative Agent in the Fee Letter.
(d) All fees payable hereunder shall be paid on the dates due, in
immediately available funds, to the Global Administrative Agent (or the Issuing
Bank, in the case of fees payable to it) for distribution, in the case of
Commitment Fees, and participation fees, to the Lenders entitled thereto. Fees
paid shall not be refundable under any circumstances.
SECTION 2.12. Interest.
(a) Subject to Section 10.13, the Loans comprising each ABR Borrowing
shall bear interest at the Alternate Base Rate plus the Applicable Rate for ABR
Loans.
(b) Subject to Section 10.13, the Loans comprising each Eurodollar
Borrowing shall bear interest at the Adjusted LIBO Rate for the Interest Period
in effect for such Borrowing plus the Applicable Rate for Eurodollar Loans.
(c) Notwithstanding the foregoing, but subject to Section 10.13, if any
principal of or interest on any Loan or any fee or other amount payable by the
Borrower hereunder is not paid when due, whether at stated maturity, upon
acceleration or otherwise, such overdue amount shall bear interest, after as
well as before judgment, at a rate per annum equal to (i) in the case of overdue
principal of any Loan, the rate otherwise applicable to such Loan as provided in
the preceding paragraphs of this Section plus, to the extent permitted by
applicable law, 2% or (ii) in the case of any other amount, the rate applicable
to ABR Loans as provided in paragraph (a) of this Section plus, to the extent
permitted by applicable law, 2%.
(d) Subject to Section 10.13, accrued interest on each Loan shall be
payable in arrears on each Interest Payment Date for such Loan and upon
termination of the Commitments; provided that (i) interest accrued pursuant to
paragraph (c) of this Section shall be payable on demand of the Global
Administrative Agent or the Required Lenders (through the Global Administrative
Agent), (ii) in the event of any repayment or prepayment of any Loan, accrued
interest on the principal amount repaid or prepaid shall be payable on the date
of such repayment or prepayment and (iii) in the event of any conversion of any
Eurodollar Loan prior to the end of the current Interest Period therefor,
accrued interest on such Loan shall be payable on the effective date of such
conversion.
(e) Subject to Section 10.13, all interest hereunder shall be computed
on the basis of a year of 360 days, except that interest computed by reference
to the Alternate Base Rate at times when the Alternate Base Rate is based on the
Prime Rate, shall be computed on the basis of a year of 365 days (or 366 days in
a leap year), and in each case shall be payable for the actual number of days
elapsed (including the first day but excluding the last day). Promptly after the
determination of any interest rate provided for herein or any change therein,
the Global Administrative Agent shall notify the Lenders to which such interest
is payable and the Borrower thereof. Each determination
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by the Global Administrative Agent of an interest rate or fee hereunder shall,
except in cases of manifest error, be final, conclusive and binding on the
parties.
SECTION 2.13. Alternate Rate of Interest. If prior to the commencement
of any Interest Period for a Eurodollar Borrowing:
(a) the Global Administrative Agent determines (which determination
shall be conclusive absent manifest error) that adequate and reasonable means do
not exist for ascertaining the Adjusted LIBO Rate or the LIBO Rate, as
applicable, for such Interest Period;
(b) the Global Administrative Agent is advised by the Required Lenders
that the Adjusted LIBO Rate for such Interest Period will not adequately and
fairly reflect the cost to such Lenders of making or maintaining their Loans
included in such Borrowing for such Interest Period; or
(c) the Global Administrative Agent determines in good faith (which
determination shall be conclusive) that by reason of circumstances affecting the
interbank dollar market generally, deposits in U.S. Dollars in the London
interbank dollar market are not being offered for the applicable Interest Period
and in an amount equal to the amount of the Eurodollar Loan requested by the
Borrower,
then the Global Administrative Agent shall give notice thereof to the Borrower
and the Lenders by telephone or telecopy as promptly as practicable thereafter
and, until the Global Administrative Agent notifies the Borrower and the Lenders
that the circumstances giving rise to such notice no longer exist, (i) any
Interest Election Request that requests the conversion of any Borrowing to, or
continuation of any Borrowing as, a Eurodollar Borrowing for the affected
Interest Period shall be ineffective, and (ii) if any Borrowing Request requests
a Eurodollar Borrowing, such Borrowing shall be made as a Eurodollar Loan having
the shortest Interest Period which is not unavailable under clauses (a) through
(c) of this Section, and if no Interest Period is available, as an ABR
Borrowing.
SECTION 2.14. Illegality.
(a) Notwithstanding any other provision of this Agreement to the
contrary, if (i) by reason of the adoption of any applicable Governmental Rule
or any change in any applicable Governmental Rule or in the interpretation or
administration thereof by any Governmental Authority or compliance by any Lender
with any request or directive (whether or not having the force of law) of any
central bank or other Governmental Authority or (ii) circumstances affecting the
London interbank dollar market or the position of a Lender therein shall at any
time make it unlawful or impracticable in the sole discretion of a Lender
exercised in good faith for such Lender or its Applicable Lending Office to (A)
honor its obligation to make Eurodollar Loans either generally or for a
particular Interest Period provided for hereunder, or (B) maintain Eurodollar
Loans either generally or for a particular Interest Period provided for
hereunder, then such Lender shall promptly notify the Borrower thereof through
the Global Administrative Agent and such Lender's obligation
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to make or maintain Eurodollar Loans having an affected Interest Period
hereunder shall be suspended until such time as such Lender may again make and
maintain Eurodollar Loans having an affected Interest Period (in which case the
provisions of Section 2.14(b) hereof shall be applicable). Before giving such
notice pursuant to this Section 2.14, such Lender will designate a different
available Applicable Lending Office for the affected Eurodollar Loans of such
Lender or take such other action as the Borrower may request if such designation
or action will avoid the need to suspend such Lender's obligation to make
Eurodollar Loans hereunder and will not, in the sole opinion of such Lender
exercised in good faith, be disadvantageous to such Lender (provided, that such
Lender shall have no obligation so to designate an Applicable Lending Office for
Eurodollar Loans located in the United States of America).
(b) If the obligation of any Lender to make or maintain any Eurodollar
Loans shall be suspended pursuant to Section 2.14(a) hereof, all Loans having an
affected Interest Period which would otherwise be made by such Lender as
Eurodollar Loans shall be made instead as ABR Loans (and, if such Lender so
requests by notice to the Borrower with a copy to the Global Administrative
Agent, each Eurodollar Loan having an affected Interest Period of such Lender
then outstanding shall be automatically converted into an ABR Loan on the last
day of the Interest Period for such Eurodollar Loans unless earlier conversion
is required by applicable law) and, to the extent that Eurodollar Loans are so
made as (or converted into) ABR Loans, all payments of principal which would
otherwise be applied to such Eurodollar Loans shall be applied instead to such
ABR Loans.
SECTION 2.15. Increased Costs.
(a) If any Change in Law shall:
(i) impose, modify or deem applicable any reserve, special
deposit or similar requirement against assets of, deposits with or for
the account of, or credit extended by, any Lender (except any such
reserve requirement reflected in the Adjusted LIBO Rate) or any Issuing
Bank; or
(ii) impose on any Lender or any Issuing Bank or the London
interbank market any other condition affecting this Agreement or
Eurodollar Loans made by such Lender or any Letter of Credit or
participation therein;
and the result of any of the foregoing shall be to increase the cost to such
Lender of making or maintaining any Eurodollar Loan (or of maintaining its
obligation to make any such Loan) or to increase the cost to such Lender or such
Issuing Bank of participating in, issuing or maintaining any Letter of Credit or
to reduce the amount of any sum received or receivable by such Lender or such
Issuing Bank hereunder (whether of principal, interest or otherwise), then the
Borrower will pay to such Lender or such Issuing Bank such additional amount or
amounts as will compensate such Lender or such Issuing Bank, as the case may be,
for such additional costs incurred or reduction suffered.
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(b) If any Lender or any Issuing Bank determines that any Change in Law
regarding capital requirements has or would have the effect of reducing the rate
of return on such Lender's or such Issuing Bank's capital or on the capital of
such Lender's or such Issuing Bank's holding company, if any, as a consequence
of this Agreement or the Loans made by, or participations in Letters of Credit
held by, such Lender, or the Letters of Credit issued by such Issuing Bank, to a
level below that which such Lender or such Issuing Bank or such Lender's or such
Issuing Bank's holding company could have achieved but for such Change in Law
(taking into consideration such Lender's or such Issuing Bank's policies and the
policies of such Lender's or such Issuing Bank's holding company with respect to
capital adequacy), then the Borrower will pay to such Lender or such Issuing
Bank, as the case may be, such additional amount or amounts as will compensate
such Lender or such Issuing Bank or such Lender's or such Issuing Bank's holding
company for any such reduction suffered.
(c) A certificate of a Lender or an Issuing Bank setting forth the
amount or amounts necessary to compensate such Lender or such Issuing Bank or
such Lender's or such Issuing Bank's holding company, as the case may be, as
specified in paragraph (a) or (b) of this Section shall be delivered to the
Borrower and shall be conclusive absent manifest error. The Borrower shall pay
such Lender or such Issuing Bank, as the case may be, the amount shown as due on
any such certificate within ten (10) days after receipt thereof.
(d) Failure or delay on the part of any Lender or any Issuing Bank to
demand compensation pursuant to this Section shall not constitute a waiver of
such Lender's or such Issuing Bank's right to demand such compensation; provided
that the Borrower shall not be required to compensate a Lender or an Issuing
Bank pursuant to this Section for any increased costs or reductions incurred
more than 270 days prior to the date that such Lender or such Issuing Bank, as
the case may be, notifies the Borrower of the Change in Law giving rise to such
increased costs or reductions and of such Lender's or such Issuing Bank's
intention to claim compensation therefor; provided further that, if the Change
in Law giving rise to such increased costs or reductions is retroactive, then
the 270-day period referred to above shall be extended to include the period of
retroactive effect thereof.
SECTION 2.16. Break Funding Payments. In the event of (a) the payment
(including prepayment) of any principal of any Eurodollar Loan other than on the
last day of an Interest Period applicable thereto (including as a result of an
Event of Default), (b) the conversion of any Eurodollar Loan other than on the
last day of the Interest Period applicable thereto, (c) the failure to borrow,
convert, continue or prepay any Loan on the date specified in any notice
delivered pursuant hereto (regardless of whether such notice may be revoked
under Section 2.10(b) and is revoked in accordance therewith), or (d) the
assignment of any Eurodollar Loan other than on the last day of the Interest
Period applicable thereto as a result of a request by the Borrower pursuant to
Section 2.19 then, in any such event, the Borrower shall compensate each Lender
for the loss, cost and expense attributable to such event. In the case of a
Eurodollar Loan, such loss, cost or expense to any Lender shall be deemed to
include an amount determined by such Lender to be the excess, if any, of (i) the
amount of interest which would have accrued on the principal amount of such Loan
had such event not occurred, at the Adjusted LIBO Rate that would have been
applicable to such
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Loan, for the period from the date of such event to the last day of the then
current Interest Period therefor (or, in the case of a failure to borrow,
convert or continue, for the period that would have been the Interest Period for
such Loan), over (ii) the amount of interest which would accrue on such
principal amount for such period at the interest rate which such Lender would
bid were it to bid, at the commencement of such period, for dollar deposits of a
comparable amount and period from other banks in the London interbank market. A
certificate of any Lender setting forth any amount or amounts that such Lender
is entitled to receive pursuant to this Section shall be delivered to the
Borrower and the Global Administrative Agent and shall be conclusive absent
manifest error. The Borrower shall pay such Lender the amount shown as due on
any such certificate within ten (10) days after receipt thereof.
SECTION 2.17. Taxes.
(a) Any and all payments by or on account of any obligation of the
Borrower hereunder or under any other Loan Document shall be made free and clear
of and without deduction for any Indemnified Taxes or Other Taxes; provided that
if the Borrower shall be required to deduct any Indemnified Taxes or Other Taxes
from such payments, then (i) the sum payable shall be increased as necessary so
that after making all required deductions (including deductions applicable to
additional sums payable under this Section), the Global Administrative Agent,
each Lender or Issuing Bank (as the case may be) receives an amount equal to the
sum it would have received had no such deductions been made, (ii) the Borrower
shall make such deductions and (iii) the Borrower shall pay the full amount
deducted to the relevant Governmental Authority in accordance with applicable
law; provided that if a Lender is in breach of its obligations under Section
2.17(e), then the Borrower shall only be obligated to comply with clauses (ii)
and (iii) of this Section 2.17(a) with respect to payments to be made to such
Lender.
(b) In addition, the Borrower shall pay any Other Taxes to the relevant
Governmental Authority in accordance with applicable law.
(c) The Borrower shall indemnify the Global Administrative Agent, each
Lender and each Issuing Bank, within ten (10) days after written demand
therefor, for the full amount of any Indemnified Taxes or Other Taxes paid by
the Global Administrative Agent, such Lender or such Issuing Bank, as the case
may be, on or with respect to any payment by or on account of any obligation of
the Borrower hereunder or under any other Loan Document (including Indemnified
Taxes or Other Taxes imposed or asserted on or attributable to amounts payable
under this Section) and any penalties, interest and reasonable expenses arising
therefrom or with respect thereto, whether or not such Indemnified Taxes or
Other Taxes were correctly or legally imposed or asserted by the relevant
Governmental Authority ; provided that if a Lender is in breach of its
obligations under Section 2.17(e), then the Borrower shall have no obligations
under this Section 2.17(c) with respect to any payments or liabilities described
herein made or owed by such Lender. A certificate as to the amount of such
payment or liability delivered to the Borrower by a Lender or an Issuing Bank,
or by the Global Administrative Agent on its own behalf or on behalf of a Lender
or an Issuing Bank, shall be conclusive absent manifest error.
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(d) As soon as practicable after any payment of Indemnified Taxes or
Other Taxes by the Borrower to a Governmental Authority, if available, the
Borrower shall deliver to the Global Administrative Agent the original or a
certified copy of a receipt issued by such Governmental Authority evidencing
such payment, a copy of the return reporting such payment or other evidence of
such payment reasonably satisfactory to the Global Administrative Agent.
(e) Each Lender that is not organized under the laws of the United
States of America or a state thereof agrees that such Lender will deliver to the
Borrower and the Global Administrative Agent two (2) duly completed copies of
United States Internal Revenue Service Form W-8 BEN or W-8 ECI (or if such forms
are no longer required, a representation by such Lender) certifying in either
case that such Lender is entitled to receive payments from the Loan Parties
under the Loan Documents without deduction or withholding of any United States
federal income taxes. Each Lender which so delivers a Form W-8 BEN or W-8 ECI
further undertakes to deliver to the Borrower and the Global Administrative
Agent two (2) additional copies of such form (or a successor form) on or before
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 the Borrower or the Global Administrative Agent, in each case,
certifying that such Lender is entitled to receive payments from the Borrower
under the Loan Documents without deduction or withholding of any United States
federal income taxes, unless (i) 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
inapplicable or which would prevent such Lender from duly completing and
delivering any such form with respect to it and (ii) such Lender advises the
Borrower and the Global Administrative Agent that it is not capable of receiving
such payments without any deduction or withholding of United States federal
income tax.
(f) If the Borrower at any time pays an amount under Section 2.17(a),
(b) or (c) to any Lender, the Global Administrative Agent or any Issuing Bank,
and such payee receives a refund of or credit for any part of any Indemnified
Taxes or Other Taxes which such payee determines in its sole judgment is made
with respect to such amount paid by the Borrower, such Lender, the Global
Administrative Agent or any Issuing Bank, as the case may be, shall pay to the
Borrower the amount of such refund or credit promptly, and in any event within
60 days, following the receipt of such refund or credit by such payee.
SECTION 2.18. Payments Generally; Pro Rata Treatment; Sharing of
Set-offs.
(a) The Borrower shall make each payment required to be made by it
hereunder or under any other Loan Document (whether of principal, interest, fees
or reimbursement of LC Disbursements, or of amounts payable under Section 2.15,
2.16 or 2.17, or otherwise) prior to the time expressly required hereunder or
under such other Loan Document for such payment (or, if no such time is
expressly required, prior to 12:00 noon, New York City time), on the date when
due, in immediately available funds, without set-off or counterclaim. Any
amounts received after such time on any date may, in the discretion of the
Global Administrative Agent, be deemed to have been received on the next
succeeding Business Day for purposes of calculating interest thereon. All such
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payments shall be made to the Global Administrative Agent c/o The Chase
Manhattan Bank, Loan and Agency Services, ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇,
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇, Attention: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇, Telephone: ▇▇▇-▇▇▇-▇▇▇▇, Fax:
▇▇▇-▇▇▇-▇▇▇▇, with a copy to The Chase Manhattan Bank, Global Oil & Gas, ▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇, Attention: ▇▇▇▇▇ ▇▇▇▇▇▇▇,
Telephone: ▇▇▇-▇▇▇-▇▇▇▇, Fax: ▇▇▇-▇▇▇-▇▇▇▇, except payments to be made directly
to an Issuing Bank as expressly provided herein and payments pursuant to
Sections 2.15, 2.16, 2.17(c) and 10.3 shall be made directly to the Persons
entitled thereto and payments pursuant to other Loan Documents shall be made to
the Persons specified therein. The Global Administrative Agent shall distribute
any such payments received by it for the account of any other Person to the
appropriate recipient promptly following receipt thereof. Except as set forth in
clause (a) of the definition of "Interest Period", if any payment under any Loan
Document shall be due on a day that is not a Business Day, the date for payment
shall be extended to the next succeeding Business Day, and, in the case of any
payment accruing interest, interest thereon shall be payable for the period of
such extension. All payments under each Loan Document shall be made in U.S.
Dollars.
(b) If at any time insufficient funds are received by and available to
the Global Administrative Agent to pay fully all amounts of principal,
unreimbursed LC Disbursements, interest and fees then due hereunder, such funds
shall be applied (i) first, towards payment of interest and fees then due
hereunder, ratably among the parties entitled thereto in accordance with the
amounts of interest and fees then due to such parties, and (ii) second, towards
payment of principal and unreimbursed LC Disbursements then due hereunder,
ratably among the parties entitled thereto in accordance with the amounts of
principal and unreimbursed LC Disbursements then due to such parties.
(c) If any Lender shall, by exercising any right of set-off or
counterclaim or otherwise, obtain payment in respect of any principal of or
interest on any of its Loans or participations in LC Disbursements resulting in
such Lender receiving payment of a greater proportion of the aggregate amount of
its Loans and participations in LC Disbursements and accrued interest thereon
than the proportion received by any other Lender, then the Lender receiving such
greater proportion shall purchase (for cash at face value) participations in the
Loans and participations in LC Disbursements of other Lenders to the extent
necessary so that the benefit of all such payments shall be shared by the
Lenders ratably in accordance with the aggregate amount of principal of and
accrued interest on their respective Loans and participations in LC
Disbursements; provided that (i) if any such participations are purchased and
all or any portion of the payment giving rise thereto is recovered, such
participations shall be rescinded and the purchase price restored to the extent
of such recovery, without interest, and (ii) the provisions of this paragraph
shall not be construed to apply to any payment made by the Borrower pursuant to
and in accordance with the express terms of this Agreement or any payment
obtained by a Lender as consideration for the assignment of or sale of a
participation in any of its Loans or participations in LC Disbursements to any
assignee or participant, other than to the Borrower or any Subsidiary or
Affiliate thereof (as to which the provisions of this paragraph shall apply).
The Borrower consents to the foregoing and agrees, to the extent it may
effectively do so under applicable law, that any Lender acquiring a
participation pursuant to the foregoing arrangements may exercise against the
Borrower rights of set-off and
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counterclaim with respect to such participation as fully as if such Lender were
a direct creditor of the Borrower in the amount of such participation.
(d) Unless the Global Administrative Agent shall have received notice
from the Borrower prior to the date on which any payment is due to the Global
Administrative Agent for the account of the Lenders or an Issuing Bank hereunder
that the Borrower will not make such payment, the Global Administrative Agent
may assume that the Borrower has made such payment on such date in accordance
herewith and may, in reliance upon such assumption, distribute to the Lenders or
an Issuing Bank, as the case may be, the amount due. In such event, if the
Borrower has not in fact made such payment, then each of the Lenders or each of
the Issuing Banks, as the case may be, severally agrees to repay to the Global
Administrative Agent forthwith on demand the amount so distributed to such
Lender or such Issuing Bank with interest thereon, for each day from and
including the date such amount is distributed to it to but excluding the date of
payment to the Global Administrative Agent, at the greater of the Federal Funds
Effective Rate and a rate determined by the Global Administrative Agent in
accordance with banking industry rules on interbank compensation.
(e) If any Lender shall fail to make any payment required to be made by
it pursuant to Section 2.4(d) or (e), 2.5(b), 2.18(d) or 10.3(c) then the Global
Administrative Agent may, in its discretion (notwithstanding any contrary
provision hereof), apply any amounts thereafter received by the Global
Administrative Agent for the account of such Lender to satisfy such Lender's
obligations under such Sections until all such unsatisfied obligations are fully
paid.
SECTION 2.19. Mitigation Obligations; Replacement of Lenders.
(a) If any Lender requests compensation under Section 2.15, or if the
Borrower is required to pay any additional amount to any Lender or any
Governmental Authority for the account of any Lender pursuant to Section 2.17,
then such Lender shall use reasonable efforts to designate a different
Applicable Lending Office for funding or booking its Loans hereunder or to
assign its rights and obligations hereunder to another of its offices, branches
or Affiliates, if, in the judgment of such Lender, such designation or
assignment (i) would eliminate or reduce amounts payable pursuant to Section
2.15 or 2.17, as the case may be, in the future and (ii) would not subject such
Lender to any unreimbursed cost or expense and would not otherwise be
disadvantageous to such Lender. The Borrower hereby agrees to pay all reasonable
costs and expenses incurred by any Lender in connection with any such
designation or assignment.
(b) If (i) any Lender asserts that events have occurred suspending its
obligation to make or maintain Eurodollar Loans under Section 2.14 when
substantially all other Lenders have not also done so, (ii) any Lender requests
compensation under Section 2.15, (iii) the Borrower is required to pay any
additional amount to any Lender or any Governmental Authority for the account of
any Lender pursuant to Section 2.17, or (iv) any Lender defaults in its
obligation to fund Loans hereunder, then the Borrower may, at its sole expense
and effort, upon notice to such Lender and the Global Administrative Agent,
require such Lender to assign and delegate, without recourse (in accordance with
and subject to the restrictions contained in Section 10.4), all its interests,
rights and
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obligations under this Agreement to an assignee that shall assume such
obligations (which assignee may be another Lender, if a Lender accepts such
assignment); provided that (1) the Borrower shall have received the prior
written consent of the Global Administrative Agent, which consent shall not
unreasonably be withheld or delayed, (2) such Lender shall have received payment
of an amount equal to the outstanding principal of its Loans and participations
in LC Disbursements, accrued interest thereon, accrued fees and all other
amounts payable to it hereunder, from the assignee (to the extent of such
outstanding principal and accrued interest and fees) or the Borrower (in the
case of all other amounts), (3) the assignee and assignor shall have entered
into an Assignment and Acceptance, and (4) in the case of any such assignment
resulting from a claim for compensation under Section 2.15 or payments required
to be made pursuant to Section 2.17, such assignment will result in a reduction
in such compensation or payments.
SECTION 2.20. Currency Conversion and Currency Indemnity.
(a) Payments in Agreed Currency. The Borrower shall make payment
relative to any Obligation in the currency (the "Agreed Currency") in which the
Obligation was effected. If any payment is received on account of any Obligation
in any currency (the "Other Currency") other than the Agreed Currency (whether
voluntarily or pursuant to an order or judgment or the enforcement thereof or
the realization of any Collateral or the liquidation of the Borrower or
otherwise howsoever), such payment shall constitute a discharge of the liability
of the Borrower hereunder and under the other Loan Documents in respect of such
obligation only to the extent of the amount of the Agreed Currency which the
relevant Lender or Agent, as the case may be, is able to purchase with the
amount of the Other Currency received by it on the Business Day next following
such receipt in accordance with its normal procedures and after deducting any
premium and costs of exchange.
(b) Conversion of Agreed Currency into Judgment Currency. If, for the
purpose of obtaining or enforcing judgment in any court in any jurisdiction, it
becomes necessary to convert into a particular currency (the "Judgment
Currency") any amount due in the Agreed Currency then the conversion shall be
made on the basis of the rate of exchange prevailing on the next Business Day
following the date such judgment is given and in any event the Borrower shall be
obligated to pay the Agents and the Lenders any deficiency in accordance with
Section 2.20(c). For the foregoing purposes "rate of exchange" means the rate at
which the relevant Lender or Agent, as applicable, in accordance with its normal
banking procedures is able on the relevant date to purchase the Agreed Currency
with the Judgment Currency after deducting any premium and costs of exchange.
(c) Circumstances Giving Rise to Indemnity. To the fullest extent
permitted by applicable law, if (i) any Lender or any Agent receives any payment
or payments on account of the liability of the Borrower hereunder pursuant to
any judgment or order in any Other Currency, and (ii) the amount of the Agreed
Currency which the relevant Lender or Agent, as applicable, is able to purchase
on the Business Day next following such receipt with the proceeds of such
payment or payments in accordance with its normal procedures and after deducting
any premiums and costs of exchange is less than the amount of the Agreed
Currency due in respect of such liability
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immediately prior to such judgment or order, then the Borrower on demand shall,
and the Borrower hereby agrees to, indemnify the Lenders and the Agents from and
against any loss, cost or expense arising out of or in connection with such
deficiency.
(d) Indemnity Separate Obligation. To the fullest extent permitted by
applicable law, the agreement of indemnity provided for in Section 2.20(c) shall
constitute an obligation separate and independent from all other obligations
contained in this Agreement, shall give rise to a separate and independent cause
of action, shall apply irrespective of any indulgence granted by the Lenders or
Agents or any of them from time to time, and shall continue in full force and
effect notwithstanding any judgment or order for a liquidated sum in respect of
an amount due hereunder or under any judgment or order.
SECTION 2.21. Addition of Lenders and Increase in Commitments. It is
agreed by the parties hereto that one or more financial institutions acceptable
to the Borrower and the Global Administrative Agent may become a Lender under
this Agreement by executing and delivering to the Borrower and the Global
Administrative Agent a certificate substantially in the form of Exhibit B hereto
(a "Lender Certificate"). Upon receipt and agreement by the Borrower and the
Global Administrative Agent of any such Lender Certificate, (a) the aggregate
amount of the Commitments of the Lenders (including any Person that becomes a
Lender by delivery of such a Lender Certificate) automatically without further
action by the Borrower, the Global Administrative Agent or any Lender shall be
increased by the amount indicated in such Lender Certificate (but not in excess
of the Equivalent Amount of U.S.$75,000,000 in the aggregate for all such
increases in the Combined Revolving Commitments pursuant to this Section and
Section 2.21 of the Canadian Revolving Credit Agreement) on the effective date
set forth in such Lender Certificate (such increased amount herein the
"Increased Commitment Amount"), (b) the Register shall be amended to add such
Commitment of such additional Lender or to reflect the increase in the
Commitment of an existing Lender and the Applicable Percentages of the Lenders
shall be adjusted accordingly to reflect the additional Lender or in the
increase in the Commitment of an existing Lender, (c) any such additional Lender
shall be deemed to be a party in all respect to this Agreement and the other
Loan Documents, and (d) upon the effective date set forth in such Lender
Certificate, any such Lender party to the Lender Certificate shall (i) purchase
a pro rata portion of the outstanding Credit Exposure of each of the current
Lenders such that the Lenders (including any additional Lender, if applicable)
shall have the appropriate portion of the aggregate outstanding Credit Exposure
(based in each case of such Lender's Applicable Percentage, as revised pursuant
to this Section) and (ii) make any required payments pursuant to Section 2.16 in
connection with the purchases described in clause (i) above.
ARTICLE III
Representations and Warranties
In order to induce the Global Administrative Agent, the other Agents,
any Issuing Bank and the Lenders to enter into this Agreement and to make Loans
hereunder, the Borrower represents and warrants to the Global Administrative
Agent, the other Agents, any Issuing Bank and the Lenders as set forth in this
Article.
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SECTION 3.1. Corporate Existence. Each of the Borrower and its
Subsidiaries: (i) is an organization duly organized, legally existing and in
good standing under the laws of the jurisdiction of its organization; (ii) has
all requisite power, and has all material Government Approvals necessary to own
its assets and carry on its business as now being or as proposed to be
conducted; and (iii) is qualified to do business in all jurisdictions in which
the nature of the business conducted by it makes such qualification necessary
and where failure so to qualify could reasonably be expected to have a Material
Adverse Effect.
SECTION 3.2. Financial Condition. The audited consolidated balance
sheet of the Borrower and its Consolidated Subsidiaries as at December 31, 1999
and the related consolidated statement of income, stockholders' equity and cash
flow of the Borrower and its Consolidated Subsidiaries for the fiscal year ended
on said date, with the opinion thereon of ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ LLP heretofore
furnished to each of the Lenders and the unaudited consolidated balance sheet of
the Borrower and its Consolidated Subsidiaries as at September 30, 2000 and
their related consolidated statements of income, stockholders' equity and cash
flow of the Borrower and its Consolidated Subsidiaries for the nine month period
ended on such date heretofore furnished to the Global Administrative Agent, are
complete and correct and fairly present, in all material respects, the
consolidated financial condition of the Borrower and its Consolidated
Subsidiaries as at said dates and the results of its operations for the fiscal
year and the nine month period on said dates, all in accordance with GAAP, as
applied on a consistent basis (subject, in the case of the interim financial
statements, to normal year-end adjustments). The pro forma balance sheet of the
Borrower as of September 30, 2000 delivered to the Global Administrative Agent
and prepared giving effect to the Acquisition (i) has been prepared in good
faith in accordance with GAAP, (ii) is based upon assumptions believed to be
reasonable and (iii) presents fairly, in all material respects, the unaudited,
pro forma financial position of the Borrower and its Subsidiaries as of
September 30, 2000. Neither the Borrower nor any Consolidated Subsidiary has on
the Closing Date any material Indebtedness, contingent liabilities, liabilities
for taxes, unusual forward or long-term commitments or unrealized or anticipated
losses from any unfavorable commitments, except as referred to or reflected or
provided for in the Financial Statements or in Schedule 3.2. Since September 30,
2000, there has been no change or event which could reasonably be expected to
have a Material Adverse Effect. Since the date of the Financial Statements,
neither the business nor the Properties of the Borrower or any Subsidiary have
been materially and adversely affected as a result of any fire, explosion,
earthquake, flood, drought, windstorm, accident, strike or other labor
disturbance, embargo, requisition or taking of Property or cancellation of
contracts, permits or concessions by any Governmental Authority, riot,
activities of armed forces or acts of God or of any public enemy.
SECTION 3.3. Litigation. At the Closing Date, there is no litigation,
legal, administrative or arbitral proceeding, investigation or other action of
any nature pending or, to the knowledge of the Borrower threatened against or
affecting the Borrower or any Subsidiary which involves the possibility of any
judgment or liability against the Borrower or any Subsidiary not fully covered
by insurance (except for normal deductibles), and which could reasonably be
expected to have a Material Adverse Effect.
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SECTION 3.4. No Breach. Neither the execution and delivery of the
Combined Loan Documents, nor compliance with the terms and provisions hereof
will conflict with or result in a breach of, or require any consent which has
not been obtained as of the Closing Date under, the respective Organic Documents
of the Borrower or any Subsidiary, or any Governmental Rule or any material
agreement or instrument to which the Borrower or any Subsidiary is a party or by
which it is bound or to which it or its Properties are subject, or constitute a
default under any such agreement or instrument, or result in the creation or
imposition of any Lien upon any of the revenues or assets of the Borrower or any
Subsidiary pursuant to the terms of any such agreement or instrument other than
the Liens created by the Combined Loan Documents.
SECTION 3.5. Authority. Each Loan Party has all necessary power and
authority to execute, deliver and perform its obligations under the Combined
Loan Documents to which it is a party; and the execution, delivery and
performance by each Loan Party of the Combined Loan Documents to which it is a
party, have been duly authorized by all necessary action on its part; and the
Combined Loan Documents constitute the legal, valid and binding obligations of
each Loan Party party thereto, enforceable in accordance with their terms,
except to the extent that enforcement may be subject to any applicable
bankruptcy, insolvency or similar laws generally affecting the enforcement of
creditors' rights.
SECTION 3.6. Approvals. No authorizations, approvals or consents of,
and no filings or registrations with, any Governmental Authority are necessary
for the execution, delivery or performance by any Loan Party of the Combined
Loan Documents or for the validity or enforceability thereof.
SECTION 3.7. Use of Proceeds and Letters of Credit. The Borrower will,
and will cause each Subsidiary to, use the proceeds of the Loans (a) to
refinance existing Indebtedness of the Borrower and its Subsidiaries, (b) to
reimburse each Issuing Bank for LC Disbursements in accordance with Section
2.4(e), or (c) for the Borrower's and its Subsidiaries' general corporate
purposes, including intercompany Investments. No part of the proceeds of any
Loan will be used, whether directly or indirectly, for any purpose that entails
a violation of any of the regulations of the Board, including Regulation U.
Letters of Credit will be issued only to support normal and customary oil and
gas operations undertaken by the Borrower or any of its Subsidiaries in the
ordinary course of its business.
SECTION 3.8. ERISA. Except as could not reasonably be expected to have
a Material Adverse Effect (or with respect to clauses (a), (b) or (e) where the
failure to take such actions could not reasonably be expected to have a Material
Adverse Effect):
(a) The Borrower, each Subsidiary and each ERISA Affiliate have
complied with ERISA and, where applicable, the Code regarding each Plan.
(b) Each Plan is, and has been, maintained in substantial compliance
with ERISA and, where applicable, the Code.
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(c) No act, omission or transaction has occurred which could result in
imposition on the Borrower, any Subsidiary or any ERISA Affiliate (whether
directly or indirectly) of (i) either a civil penalty assessed pursuant to
section 502(c), (i) or (l) of ERISA or a tax imposed pursuant to Chapter 43 of
Subtitle D of the Code or (ii) breach of fiduciary duty liability damages under
section 409 of ERISA.
(d) No Plan (other than a defined contribution plan) or any trust
created under any such Plan has been terminated since September 2, 1974. No
liability to the PBGC (other than for the payment of current premiums which are
not past due) by the Borrower, any Subsidiary or any ERISA Affiliate has been or
is expected by the Borrower, any Subsidiary or any ERISA Affiliate to be
incurred with respect to any Plan. No ERISA Event with respect to any Plan has
occurred.
(e) Full payment when due has been made of all amounts which the
Borrower, any Subsidiary or any ERISA Affiliate is required under the terms of
each Plan or applicable law to have paid as contributions to such Plan, and no
accumulated funding deficiency (as defined in section 302 of ERISA and section
412 of the Code), whether or not waived, exists with respect to any Plan.
(f) The actuarial present value of the benefit liabilities under each
Plan which is subject to Title IV of ERISA does not, as of the end of the
Borrower's most recently ended fiscal year, exceed the current value of the
assets (computed on a plan termination basis in accordance with Title IV of
ERISA) of such Plan allocable to such benefit liabilities. The term "actuarial
present value of the benefit liabilities" shall have the meaning specified in
section 4041 of ERISA.
(g) None of the Borrower, any Subsidiary or any ERISA Affiliate
sponsors, maintains, or contributes to an employee welfare benefit plan, as
defined in section 3(1) of ERISA, including, without limitation, any such plan
maintained to provide benefits to former employees of such entities, that may
not be terminated by the Borrower, a Subsidiary or any ERISA Affiliate in its
sole discretion at any time without any material liability.
(h) None of the Borrower, any Subsidiary or any ERISA Affiliate
sponsors, maintains or contributes to, or has at any time in the preceding six
calendar years, sponsored, maintained or contributed to, any Multiemployer Plan.
(i) None of the Borrower, any Subsidiary or any ERISA Affiliate is
required to provide security under section 401(a)(29) of the Code due to a Plan
amendment that results in an increase in current liability for the Plan.
SECTION 3.9. Taxes. Except as set forth in Schedule 3.9, each of the
Borrower and its Subsidiaries has filed all U.S. Federal income tax returns,
Canadian income tax returns and all other tax returns which are required to be
filed by them and have paid all material taxes due pursuant to such returns or
pursuant to any assessment received by the Borrower or any Subsidiary. The
charges, accruals and reserves on the books of the Borrower and its Subsidiaries
in respect of taxes and other governmental charges are, in the opinion of the
Borrower, adequate. No tax lien has been
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filed and, to the knowledge of the Borrower, no claim is being asserted with
respect to any such tax, fee or other charge.
SECTION 3.10. Properties, etc.
(a) Except as set out in Schedule 3.10, each of the Borrower and its
Subsidiaries has good and defensible title to its material (individually or in
the aggregate) Properties, free and clear of all Liens, except Liens permitted
by Section 7.2. Except as set forth in Schedule 3.10, after giving full effect
to the Excepted Liens, the Borrower owns the net interests in production
attributable to the Hydrocarbon Interests reflected in the most recently
delivered Reserve Report and the ownership of such Properties shall not in any
material respect obligate the Borrower to bear the costs and expenses relating
to the maintenance, development and operations of each such Property in an
amount in excess of the working interest of each Property set forth in the most
recently delivered Reserve Report. All information contained in the most
recently delivered Reserve Report is true and correct in all material respects
as of the date thereof.
(b) All leases and agreements necessary for the conduct of the business
of the Borrower and its Subsidiaries are valid and subsisting, in full force and
effect and there exists no default or event or circumstance which with the
giving of notice or the passage of time or both would give rise to a default
under any such lease or leases, which would affect in any material respect the
conduct of the business of the Borrower and its Subsidiaries.
(c) The rights, Properties and other assets presently owned, leased or
licensed by the Borrower and its Subsidiaries including, without limitation, all
easements and rights of way, include all rights, Properties and other assets
necessary to permit the Borrower and its Subsidiaries to conduct their business
in all material respects in the same manner as its business has been conducted
prior to the Closing Date.
(d) All of the assets and Properties of the Borrower and its
Subsidiaries which are reasonably necessary for the operation of its business
are in good working condition and are maintained in accordance with prudent
business standards.
SECTION 3.11. No Material Misstatements. No written information,
statement, exhibit, certificate, document or report furnished to the Global
Administrative Agent, the other Agents and the Lenders (or any of them) by the
Borrower or any Subsidiary in connection with the negotiation of the Combined
Loan Documents contained any material misstatement of fact or omitted to state a
material fact or any fact necessary to make the statement contained therein not
materially misleading in the light of the circumstances in which made and with
respect to the Borrower and its Subsidiaries taken as a whole. There is no fact
existing with respect to the Borrower or any Subsidiary which could reasonably
be expected to have a Material Adverse Effect or in the future could reasonably
be likely to have (so far as the Borrower can now foresee) a Material Adverse
Effect and which has not been set forth in this Agreement or the other
documents, certificates and statements furnished to the Global Administrative
Agent by or on behalf of the
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Borrower or any Subsidiary prior to, or on, the Closing Date in connection with
the transactions contemplated hereby.
SECTION 3.12. Investment Company Act. Neither the Borrower nor any
Subsidiary is an "investment company" or a company "controlled" by an
"investment company," within the meaning of the Investment Company Act of 1940,
as amended.
SECTION 3.13. Public Utility Holding Company Act. Neither the Borrower
nor any Subsidiary 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.
SECTION 3.14. Subsidiaries. Except as set forth on Schedule 3.14 or as
otherwise disclosed in writing to the Global Administrative Agent, the Borrower
has no Subsidiaries.
SECTION 3.15. Location of Business and Offices. The Borrower's
principal place of business and chief executive offices are located at the
address stated on the signature page of this Agreement or as otherwise disclosed
in writing to the Global Administrative Agent. The principal place of business
and chief executive office of each Subsidiary are located at the addresses
stated on Schedule 3.14 or as otherwise disclosed in writing to the Global
Administrative Agent.
SECTION 3.16. Defaults. Neither the Borrower nor any Subsidiary is in
default nor has any event or circumstance occurred which, but for the expiration
of any applicable grace period or the giving of notice, or both, would
constitute a default under any material agreement or instrument to which the
Borrower or any Subsidiary is a party or by which the Borrower or any Subsidiary
is bound which default could reasonably be expected to have a Material Adverse
Effect. No Default hereunder has occurred and is continuing.
SECTION 3.17. Environmental Matters. Except as could not reasonably be
expected to have a Material Adverse Effect (or with respect to clauses(c), (d)
and (e) below, where the failure to take such actions would not have a Material
Adverse Effect):
(a) Neither any Property of the Borrower or any Subsidiary nor the
operations conducted thereon violate any order or requirement of any court or
Governmental Authority or any Environmental Laws;
(b) Without limitation of clause (a) above, no Property of the Borrower
or any Subsidiary nor the operations currently conducted thereon or, to the best
knowledge of the Borrower, by any prior owner or operator of such Property or
operation, are in violation of or subject to any existing, pending or threatened
action, suit, investigation, inquiry or proceeding by or before any court or
Governmental Authority or to any remedial obligations under Environmental Laws;
(c) All notices, permits, licenses or similar authorizations, if any,
required to be obtained or filed in connection with the operation or use of any
and all Property of the Borrower and each
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Subsidiary, including without limitation past or present treatment, storage,
disposal or release of a Hazardous Material into the environment, have been duly
obtained or filed, and the Borrower and each Subsidiary are in compliance with
the terms and conditions of all such notices, permits, licenses and similar
authorizations;
(d) All Hazardous Materials, if any, generated at any and all Property
of the Borrower or any Subsidiary have in the past been transported, treated and
disposed of in accordance with Environmental Laws and so as not to pose an
imminent and substantial endangerment to public health or welfare or the
environment, and, to the best knowledge of the Borrower, all such transport
carriers and treatment and disposal facilities have been and are operating in
compliance with Environmental Laws and so as not to pose an imminent and
substantial endangerment to public health or welfare or the environment, and are
not the subject of any existing, pending or threatened action, investigation or
inquiry by any Governmental Authority in connection with any Environmental Laws;
(e) The Borrower has taken all steps reasonably necessary to determine
and has determined that no Hazardous Materials, have been disposed of or
otherwise released and there has been no threatened release of any Hazardous
Materials on or to any Property of the Borrower or any Subsidiary except in
compliance with Environmental Laws and so as not to pose an imminent and
substantial endangerment to public health or welfare or the environment;
(f) To the extent applicable, all Property of the Borrower and each
Subsidiary currently satisfies all design, operation, and equipment requirements
imposed by the OPA or scheduled as of the Closing Date to be imposed by OPA
during the term of this Agreement, and the Borrower does not have any reason to
believe that such Property, to the extent subject to OPA, will not be able to
maintain compliance with the OPA requirements during the term of this Agreement;
and
(g) Neither the Borrower nor any Subsidiary has any known contingent
liability in connection with any release or threatened release of any Hazardous
Material into the environment.
SECTION 3.18. Compliance with the Law. Neither the Borrower nor any
Subsidiary has violated any Governmental Rule or failed to obtain any
Governmental Approval necessary for the ownership of any of its Properties or
the conduct of its business, which violation or failure could reasonably be
expected to have (in the event such violation or failure were asserted by any
Person through appropriate action) a Material Adverse Effect. Except for such
acts or failures to act as could not reasonably be expected to have a Material
Adverse Effect, the Oil and Gas Properties (and properties unitized therewith)
have been maintained, operated and developed in a good and workmanlike manner
and in conformity with all applicable Governmental Rules of all Governmental
Authorities having jurisdiction and in conformity with the provisions of all
leases, subleases or other contracts comprising a part of the Hydrocarbon
Interests and other contracts and agreements forming a part of the Oil and Gas
Properties.
SECTION 3.19. Insurance. Schedule 3.19 attached hereto contains an
accurate and complete description of all material policies of fire, liability,
workmen's compensation and other
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forms of insurance owned or held by the Borrower and each Subsidiary. All such
policies are in full force and effect, all premiums with respect thereto
covering all periods up to and including the date of the closing and through the
respective dates set forth in Schedule 3.19 have been paid, and no notice of
cancellation or termination has been received with respect to any such policy.
Such policies are sufficient for compliance with all requirements of law and of
all agreements to which the Borrower or any Subsidiary is a party; are valid,
outstanding and enforceable policies; provide adequate insurance coverage in at
least such amounts and against at least such risks (but including in any event
public liability) as are usually insured against in the same general area by
companies engaged in the same or a similar business for the assets and
operations of the Borrower and each Subsidiary.
SECTION 3.20. Hedging Agreements. Schedule 3.20 sets forth, as of the
Closing Date, a true and complete list of all Hedging Agreements (including
commodity price swap agreements) and all forward agreements or contracts of sale
which provide for prepayment for deferred shipment or delivery of oil, gas or
other commodities) of the Borrower and each Subsidiary, the material terms
thereof (including the type, term, effective date, termination date and notional
amounts or volumes), the net ▇▇▇▇ to market value thereof, all credit support
agreements relating thereto (including any margin required or supplied), and the
counter party to each such agreement.
SECTION 3.21. Restriction on Liens. Except for any industrial
development bonds, purchase money mortgages or Capital Lease Obligations
permitted by Section 7.1 (in which cases, any prohibition or limitation shall
only be effective against the assets finance thereby), neither the Borrower nor
any of its Subsidiaries is a party to any agreement or arrangement (other than
this Agreement), or subject to any order, judgment, writ or decree, which either
restricts or purports to restrict its ability to grant Liens to the Global
Administrative Agent and the Lenders on or in respect of their respective assets
or Properties.
SECTION 3.22. Material Agreements. Set forth on Schedule 3.22 hereto is
a complete and correct list of all material agreements, leases, indentures,
purchase agreements, obligations in respect of letters of credit, Guarantees,
joint venture agreements, and other instruments in effect or to be in effect as
of the Closing Date (other than Hedging Agreements) providing for, evidencing,
securing or otherwise relating to any Indebtedness of the Borrower or any of its
Subsidiaries.
SECTION 3.23. Solvency. Immediately after the consummation of the
Financing Transactions to occur on the Global Effective Date and immediately
following the making of each Loan made on the Global Effective Date and after
giving effect to the application of the proceeds of such Loans, (a) each Loan
Party will not have unreasonably small capital with which to conduct the
business in which such Loan Party is engaged as such business is now conducted
and is proposed to be conducted following the Global Effective Date; and (b) the
Borrower, each Loan Party and the Borrower and its Subsidiaries, on a
consolidated basis, will be Solvent.
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ARTICLE IV
Conditions
SECTION 4.1. Initial Loan. The obligations of the Lenders to make Loans
or for any Issuing Bank to issue Letters of Credit hereunder shall not become
effective until the date on which each of the following conditions is satisfied
(or waived in accordance with Section 10.2):
(a) Certain Loan Documents. The Global Administrative Agent (or its
counsel) shall have received from each party thereto either a counterpart of
each of the following documents duly executed on behalf of such party or written
evidence satisfactory to the Global Administrative Agent (which may include
telecopy transmission of a signed signature page of such document) that each
such party has duly executed for delivery to the Global Administrative Agent a
counterpart of each of the following documents which documents must be
acceptable to the Global Administrative Agent in its sole and absolute
discretion: this Agreement, the Intercreditor Agreement, the Fee Letter, a
Guaranty from each Guarantor, the Pledge Agreement required by Section 4.1(e)
and all related financing statements and other filings, and the other Loan
Documents .
(b) Canadian Revolving Loan Documents and Canadian Term Loan Documents.
The Global Administrative Agent shall have received copies of the executed
Canadian Revolving Loan Documents and Canadian Term Loan Documents.
(c) Opinions of Counsel. The Global Administrative Agent shall have
received opinions, dated the Global Effective Date, addressed to the Global
Administrative Agent, the Canadian Administrative Agent and all Lenders, from
▇▇▇▇▇▇ & ▇▇▇▇▇▇ L.L.P., counsel to the Borrower, in substantially the form
attached hereto as Exhibit A.
(d) Organizational Documents. The Global Administrative Agent shall
have received a certificate of an Authorized Officer of each Loan Party dated as
of the Global Effective Date, certifying:
(i) that attached to each such certificate are (A) a true and
complete copy of the Organic Documents of such Loan Party, as the case
may be, as in effect on the date of such certificate, (B) a true and
complete copy of a certificate from the Governmental Authority of the
state of such entity's organization certifying that such entity is duly
organized and validly existing in such jurisdiction, and (C) a true and
complete copy of a certificate from the appropriate Governmental
Authority of each state (without duplication) certifying that such
entity is duly qualified and in good standing to transact business in
such jurisdiction as a foreign corporation, if the failure to be so
qualified or in good standing could reasonably be expected to have a
Material Adverse Effect;
(ii) that attached to such certificate is a true and complete
copy of resolutions duly adopted by the board of directors or
management committee of such Loan Party, as applicable, authorizing the
execution, delivery and performance of such of the Combined Loan
Documents to which such Loan Party is or is intended to be a party;
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(iii) that attached thereto is a copy of the certificate of
incorporation or formation, as the case may be, of such Loan Party, and
a certificate as to the good standing of and payment of franchise taxes
by the Borrower or each such Loan Party, if applicable, dated as of a
recent date; and that such certificate of incorporation or certificate
of formation, as the case may be, has not been amended since the date
of such certified copy; and
(iv) as to the incumbency and specimen signature of each
officer of such Loan Party executing such of the Combined Loan
Documents to which such Loan Party is or is intended to be a party.
(e) Pledge Agreement. The Global Administrative Agent shall have
received counterparts of the Pledge Agreement, dated as of the Closing Date,
duly executed and delivered by the Borrower, together with the following:
(i) stock certificates representing 65% of the outstanding
shares of common stock of (x) TBF and (y) TBRL, and stock powers and
instruments of transfer, endorsed in blank, with respect to such stock
certificates; and
(ii) all documents and instruments, including Uniform
Commercial Code Financing Statements (Form UCC-1), required by law or
reasonably requested by the Global Administrative Agent to be filed,
registered or recorded to create or perfect the Liens intended to be
created under the Pledge Agreement.
(f) UCC Searches. The Global Administrative Agent shall have received
(i) the UCC Searches, all dated reasonably close to the Closing Date, in the
discretion of the Global Administrative Agent and in form and substance
satisfactory to the Global Administrative Agent, and (ii) evidence reasonably
satisfactory to the Global Administrative Agent that the Liens indicated by the
financing statements (or similar documents) in such UCC Searches are permitted
by Section 7.2 or have been released.
(g) Priority; Security Interest. The Collateral and Borrowing Base
Properties shall be free and clear of all Liens, except Liens permitted by
Section 7.2. All filings, notices, recordings and other action necessary to
perfect the Liens in the Collateral shall have been made, given or accomplished
or arrangements for the completion thereof satisfactory to the Global
Administrative Agent and its counsel shall have been made and all filing fees
and other expenses related to such actions either have been paid in full or
arrangements have been made for their payment in full which are satisfactory to
the Global Administrative Agent.
(h) Approvals and Consents. The Global Administrative Agent shall have
received copies of all Governmental Approvals and third party consents and
approvals necessary or, advisable in connection with the Financing Transactions,
and all applicable waiting periods and appeal periods shall have expired, in
each case without the imposition of any burdensome conditions. There shall be no
actual government or judicial action restraining, preventing or imposing
burdensome conditions on the Financing Transactions.
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(i) Insurance. The Global Administrative Agent and the Lenders shall
have received certificates, dated within fifteen (15) days of the Closing Date,
from the Borrower's insurers certifying (i) compliance with all of the insurance
required by Section 5.3 and by the Security Documents and (ii) that such
insurance is in full force and effect.
(j) Pro Forma Balance Sheet and Income Statement. The Global
Administrative Agent shall have received the pro forma consolidated balance
sheet and income statement of the Borrower and its Subsidiaries described in
Section 3.2, and such pro forma consolidated balance sheet shall be consistent
in all material respects with the forecasts and other information previously
provided to the Lenders.
(k) Initial Reserve Report. The Global Administrative Agent and the
Lenders shall have received and shall be satisfied with the contents, results
and scope of the Initial Reserve Report.
(l) Hedging Agreements. The Global Administrative Agent shall have
received a list of any Hedging Agreements currently in existence with respect to
the Borrower or any of its Subsidiaries.
(m) Existing Facilities. The Global Administrative Agent shall have
received a certificate, signed by an Authorized Officer of the Borrower, stating
that the Borrower or its Subsidiaries have repaid in full and terminated the
Existing Credit Facilities contemporaneously with the initial Combined Loans
under the Combined Credit Agreements. The Global Administrative Agent shall have
received evidence satisfactory to it that all Liens associated with the Existing
Credit Facilities have been released or terminated contemporaneously with the
making of such payments and that arrangements satisfactory to the Global
Administrative Agent have been made for recording and filing such releases.
(n) [Intentionally omitted].
(o) Financial Statements. The Global Administrative Agent shall have
received the financial statements described in Section 3.2 hereof.
(p) Environmental Warranties. The Borrower has adopted and implemented
procedures and guidelines as the Borrower has determined are reasonably
appropriate to continuously assure compliance with applicable Environmental Laws
and to identify and evaluate events or conditions which would result in any
Environmental Liability. On the basis of these procedures and guidelines, the
Global Administrative Agent shall have received a certificate, signed by an
Authorized Officer of the Borrower, stating that after such review the Borrower
has reasonably concluded that no Environmental Liabilities exist or violations
of Environmental Laws have occurred, which, individually or in the aggregate,
could reasonably be expected to have a Material Adverse Effect.
(q) Global Effectiveness Notice. The Global Administrative Agent shall
have received the Global Effectiveness Notice.
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(r) No Material Adverse Effect; Litigation. The Global Administrative
Agent shall have received a certificate, signed by an Authorized Officer of the
Borrower, stating that (i) no event or condition has occurred since September
30, 2000, which could reasonably be expected to have a Material Adverse Effect
and (ii) no litigation, arbitration, governmental proceeding, claim for Taxes,
dispute or administrative or other proceeding shall be pending or, to the
knowledge of the Borrower, threatened against the Borrower or any of its
Subsidiaries which could reasonably be expected to have a Material Adverse
Effect or which purports to affect the legality, validity or enforceability of
this Agreement or any other Combined Loan Document.
(s) Other Documents. The Global Administrative Agent shall have
received such other legal opinions, instruments and documents as any of the
Agents or their counsel may have reasonably requested.
(t) Satisfactory Legal Form. All documents executed or submitted
pursuant hereto by and on behalf of the Borrower or any other Loan Party shall
be in form and substance reasonably satisfactory to the Global Administrative
Agent and its counsel. The Global Administrative Agent and its counsel shall
have received all information, approvals, documents or instruments as the Global
Administrative Agent or its counsel may reasonably request.
(u) Fees and Expenses. The Global Administrative Agent, the Canadian
Administrative Agent, the Arranger, the other Agents and the Lenders shall have
received all fees, including the Upfront Fee, and other amounts due and payable
pursuant to this Agreement or any other Combined Loan Document on or prior to
the date hereof, including, to the extent invoiced, reimbursement or payment of
all reasonable out-of-pocket expenses (including fees, charges and disbursements
of counsel) required to be reimbursed or paid by any Loan Party hereunder or
under any other Combined Loan Document.
(v) TBF Documents. The Global Administrative Agent and the Lenders
shall have received executed copies of and shall be satisfied with the contents
of the TBF Documents.
The Global Administrative Agent shall notify the Borrower, the other Agents and
the Lenders of the Global Effective Date, and such notice shall be conclusive
and binding. Notwithstanding the foregoing, the obligations of the Lenders to
make Loans and of the Issuing Banks to issue Letters of Credit hereunder shall
not become effective unless each of the foregoing conditions is satisfied (or
waived pursuant to Section 10.2) at or prior to 3:00 p.m., New York City time,
on April 11, 2001 (and, in the event such conditions are not so satisfied or
waived, the Commitments shall terminate at such time).
SECTION 4.2. Each Credit Event. The obligation of each Lender to make a
Loan on the occasion of any Borrowing, and of the Issuing Banks to issue, amend,
renew or extend any Letter of Credit, is subject to receipt of the request
therefor in accordance herewith and to the satisfaction of the following
conditions:
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(a) Representations and Warranties. At the time of and immediately
after giving effect to such Borrowing or the issuance, amendment, renewal or
extension of such Letter of Credit, as applicable, the representations and
warranties of each Loan Party set forth in the Combined Loan Documents to which
it is a party shall be true and correct on and as of such date after giving
effect to such funding and to the intended use thereof in all material respects
as if made on and as of such date (or, if stated to have been made expressly as
of an earlier date, were true and correct in all material respects as of such
date).
(b) No Defaults. At the time of and immediately after giving effect to
such Borrowing or the issuance, amendment, renewal or extension of such Letter
of Credit, as applicable, no Default shall have occurred and be continuing and
the Borrower shall be in compliance with the financial covenants set forth in
Article VI.
(c) No Material Adverse Effect. At the time of and immediately after
giving effect to such Borrowing or the issuance, amendment, renewal or extension
of such Letter of Credit, no event or events shall have occurred which
individually or in the aggregate could reasonably be expected to have a Material
Adverse Effect.
(d) Borrowing Request. The Global Administrative Agent shall have
received a Borrowing Request for any Borrowing. Each Borrowing and each
issuance, amendment, renewal or extension of a Letter of Credit shall be deemed
to constitute a representation and warranty by the Borrower on the date thereof
as to the matters specified in paragraphs (a), (b) and (c) of this Section.
ARTICLE V
Affirmative Covenants
The Borrower agrees with the Global Administrative Agent, the other
Agents, any Issuing Bank and each Lender that, until the Commitments have
expired or been terminated and Obligations shall have been paid and performed in
full and all Letters of Credit shall have expired or terminated and all LC
Disbursements shall have been reimbursed, the Borrower will perform the
obligations set forth in this Article.
SECTION 5.1. Reporting Requirements. The Borrower shall deliver, or
shall cause to be delivered, to the Global Administrative Agent and each Lender:
(a) Annual Financial Statements. As soon as available and in any event
within 90 days after the end of each fiscal year of the Borrower, the audited
consolidated statements of income, stockholders' equity, changes in financial
position and cash flows of the Borrower and its Consolidated Subsidiaries for
such fiscal year, and the related consolidated balance sheets of the Borrower
and its Consolidated Subsidiaries as at the end of such fiscal year, and setting
forth in each case in comparative form the corresponding figures for the
preceding fiscal year, and accompanied by the related opinion of independent
public accountants of recognized national standing reasonably acceptable to the
Global Administrative Agent which opinion shall state that said financial
statements fairly present, in all material respects, the consolidated financial
condition and results
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of operations of the Borrower and its Consolidated Subsidiaries as at the end
of, and for, such fiscal year and that such financial statements have been
prepared in accordance with GAAP, except for such changes in such principles
with which the independent public accountants shall have concurred and such
opinion shall not contain a "going concern" or like qualification or exception.
(b) Quarterly Financial Statements. As soon as available and in any
event within 60 days after the end of each of the first three fiscal quarterly
periods of each fiscal year of the Borrower, consolidated statements of income,
stockholders' equity, changes in financial position and cash flows of the
Borrower and its Consolidated Subsidiaries for such period and for the period
from the beginning of the respective fiscal year to the end of such period, and
the related consolidated balance sheets as at the end of such period, and
setting forth in each case in comparative form the corresponding figures for the
corresponding period in the preceding fiscal year, accompanied by the
certificate of an Authorized Officer, which certificate shall state that said
financial statements fairly present, in all material respects, the consolidated
financial condition and results of operations of the Borrower and its
Consolidated Subsidiaries in accordance with GAAP, as at the end of, and for,
such period (subject to normal year-end audit adjustments).
(c) Notice of Default, Etc. Promptly after the Borrower knows that any
Default or any Material Adverse Effect has occurred, a notice of such Default or
Material Adverse Effect, describing the same in reasonable detail and the action
the Borrower proposes to take with respect thereto.
(d) Other Accounting Reports. Promptly upon receipt thereof, a copy of
each other report or letter submitted to the Borrower or any Subsidiary by
independent accountants in connection with any annual, interim or special audit
made by them of the books of the Borrower and its Subsidiaries, and a copy of
any response by the Borrower or any Subsidiary of the Borrower, or the Board of
Directors of the Borrower or any Subsidiary of the Borrower, to such letter or
report.
(e) SEC Filings, Etc. Promptly upon its becoming available, each
financial statement, report, notice or proxy statement sent by the Borrower to
stockholders generally and each regular or periodic report and any registration
statement, prospectus or written communication (other than transmittal letters)
in respect thereof filed by the Borrower with or received by the Borrower in
connection therewith from any securities exchange or the SEC.
(f) Notices Under Other Loan Agreements. Promptly after the furnishing
thereof, copies of any statement, report or notice furnished to any Person
pursuant to the terms of any indenture, loan or credit or other similar
agreement, other than this Agreement and not otherwise required to be furnished
to the Lenders pursuant to any other provision of this Section 5.1.
(g) Gas Imbalances. Concurrently with the delivery of the financial
statements required to be delivered pursuant to Sections 5.1(a) and (b), a
report in form and substance satisfactory to the Global Administrative Agent
setting forth, on a net basis, all gas imbalances, take or pay or other
prepayments with respect to the Borrower's and any Subsidiaries' Oil and Gas
Properties which
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would require the Borrower or any Subsidiary to deliver Hydrocarbons produced
from such Oil and Gas Properties at some future time without then or thereafter
receiving full payment therefor.
(h) [Intentionally omitted].
(i) Notice of Asset Disposition. Promptly upon the disposition of any
Property or Equity Interest pursuant to Section 7.12(iv) either (i) which
produces net proceeds in excess of $3,000,000 or (ii) which produces net
proceeds which when aggregated with the net proceeds generated by all other
prior dispositions of Property or Equity Interests since the later to occur of
(A) the previous notice received by the Global Administrative Agent pursuant to
this Section 5.1(i) or (B) the last redetermination of the Global Borrowing Base
are in excess of $3,000,000, and in any event within five (5) Business Days of
such disposition, the Borrower shall provide the Global Administrative Agent
with written notice of such disposition which sets forth a description of the
Properties or Equity Interests so disposed of and the value assigned to such
Properties or Equity Interests in the most recent Reserve Report.
(j) Gas Marketing Policy. On or before May 31, 2001, the Borrower shall
deliver a gas marketing policy ("Gas Marketing Policy") to the Global
Administrative Agent in form and substance satisfactory to the Global
Administrative Agent, in its reasonable discretion.
(k) Other Matters. From time to time such other information regarding
the business, affairs or financial condition of the Borrower or any Subsidiary
(including, without limitation, any Plan or Multiemployer Plan and any reports
or other information required to be filed under ERISA) as any Lender or the
Global Administrative Agent may reasonably request.
The Borrower will furnish to the Global Administrative Agent, at the time it
furnishes each set of financial statements pursuant to paragraph (a) or (b)
above, a compliance certificate substantially in the form of Exhibit C executed
by an Authorized Officer (i) certifying as to the matters set forth therein and
stating that no Default has occurred and is continuing (or, if any Default has
occurred and is continuing, describing the same in reasonable detail), and (ii)
setting forth in reasonable detail the computations necessary to determine
whether the Borrower is in compliance with Sections 6.1, and 6.2 as of the end
of the respective fiscal quarter or fiscal year.
SECTION 5.2. Litigation. The Borrower shall promptly give to the Global
Administrative Agent notice of: (i) all legal or arbitral proceedings, and of
all proceedings before any Governmental Authority affecting the Borrower or any
Subsidiary, except proceedings which, if adversely determined, could not
reasonably be expected to have a Material Adverse Effect, and (ii) any
litigation or proceeding against or adversely affecting the Borrower or any
Subsidiary in which injunctive or similar relief is sought. The Borrower will,
and will cause each of its Subsidiaries to, promptly notify the Global
Administrative Agent and each of the Lenders of any claim, judgment, Lien or
other encumbrance affecting any Property of the Borrower or any Subsidiary if
the value of the claim, judgment, Lien, or other encumbrance when aggregated
with all other existing claims, judgment or Liens affecting such Property shall
exceed U.S.$3,000,000.
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SECTION 5.3. Maintenance, Etc.
(a) Generally. The Borrower shall and shall cause each Subsidiary to:
preserve and maintain its corporate existence and all of its material rights,
privileges and franchises; keep books of record and account in which full, true
and correct entries will be made of all dealings or transactions in relation to
its business and activities; comply with all Governmental Rules if failure to
comply with any such requirements could reasonably be expected to have a
Material Adverse Effect; pay and discharge all taxes, assessments and
governmental charges or levies imposed on it or on its income or profits or on
any of its Property prior to the date on which penalties attach thereto, except
for any such tax, assessment, charge or levy the payment of which is being
contested in good faith and by proper proceedings and against which adequate
reserves are being maintained; upon reasonable notice, permit representatives of
the Global Administrative Agent or any Lender, during normal business hours, to
examine, copy, and make extracts from its books and records, to inspect its
Properties, and to discuss its business and affairs with its officers, all to
the extent reasonably requested by such Lender or the Global Administrative
Agent (as the case may be); and keep, or cause to be kept, insured by
financially sound and reputable insurers all Property of a character usually
insured by Persons engaged in the same or similar business similarly situated
against loss or damage of the kinds and in the amounts customarily insured
against by such Persons and carry such other insurance as is usually carried by
such Persons including, without limitation, environmental risk insurance to the
extent reasonably available.
(b) Proof of Insurance. Contemporaneously with the delivery of the
financial statements required by Section 5.1(a) to be delivered for each year,
upon the request of the Global Administrative Agent, the Borrower will furnish
or cause to be furnished to the Global Administrative Agent and the Lenders a
certificate of insurance coverage from the insurer in form and substance
satisfactory to the Global Administrative Agent and, if requested, will furnish
the Global Administrative Agent and the Lenders copies of the applicable
policies.
(c) Oil and Gas Properties. The Borrower will and will cause each
Subsidiary to, at its own expense, (i) do or cause to be done all things
reasonably necessary to preserve and keep in good repair, working order and
efficiency all of its Oil and Gas Properties and other material Properties,
including, without limitation, all equipment, machinery and facilities, and (ii)
from time to time, make all the reasonably necessary repairs, renewals and
replacements so that at all times the state and condition of its Oil and Gas
Properties and other material Properties will be fully preserved and maintained
in all material respects, except, in either case of clauses (i) or (ii), to the
extent a portion of such Properties is no longer capable of producing
Hydrocarbons in economically reasonable amounts. The Borrower will and will
cause each Subsidiary to, in all material respects, promptly: (i) pay and
discharge, or make reasonable and customary efforts to cause to be paid and
discharged, all delay rentals, royalties and expenses accruing under the leases
or other agreements affecting or pertaining to its Oil and Gas Properties, (ii)
perform or make reasonable and customary efforts to cause to be performed, in
accordance with industry standards, the obligations required by each and all of
the assignments, deeds, leases, sub-leases, contracts and agreements affecting
its interests in its Oil and Gas Properties and other material Properties, (iii)
do all other things necessary to keep unimpaired, except for Liens permitted in
Section 7.2, its rights with respect to its Oil and Gas
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Properties and other material Properties and prevent any forfeiture thereof or a
default thereunder, except to the extent a portion of such Properties is no
longer capable of producing Hydrocarbons in economically reasonable amounts and
except for dispositions permitted by Section 7.12. The Borrower will and will
cause each Subsidiary to operate its Oil and Gas Properties and other material
Properties or cause or make reasonable and customary efforts to cause such Oil
and Gas Properties and other material Properties to be operated in a careful and
efficient manner in accordance with the practices of the industry and in
compliance with all applicable contracts and agreements and in compliance with
all Governmental Rules, except where the failure to comply would not reasonably
be expected to have a Material Adverse Effect.
SECTION 5.4. Environmental Matters.
(a) Establishment of Procedures. The Borrower will and will cause each
Subsidiary to establish and implement such procedures as may be reasonably
necessary to continuously determine and assure that any failure of the following
could not reasonably be expected to have a Material Adverse Effect: (i) all
Property of the Borrower and its Subsidiaries and the operations conducted
thereon and other activities of the Borrower and its Subsidiaries are in
compliance with and do not violate the requirements of any Environmental Laws,
(ii) no Hazardous Materials are disposed of or otherwise released on or to any
Property owned by any such party except in compliance with Environmental Laws,
(iii) no Hazardous Material will be released on or to any such Property in a
quantity equal to or exceeding that quantity which requires reporting pursuant
to Section 103 of CERCLA, and (iv) no Hazardous Material is released on or to
any such Property so as to pose an imminent and substantial endangerment to
public health or welfare or the environment.
(b) Notice of Action. The Borrower will promptly notify the Global
Administrative Agent and the Lenders in writing of any threatened action,
investigation or inquiry by any Governmental Authority of which the Borrower has
knowledge in connection with any Environmental Laws, excluding routine testing
and corrective action.
SECTION 5.5. Further Assurances. The Borrower will and will cause each
Subsidiary to cure promptly any defects in the execution and delivery of this
Agreement and any other Loan Document to which it is a party. The Borrower, at
its expense, will and will cause each Subsidiary to, promptly execute and
deliver to the Global Administrative Agent all such other documents, agreements
and instruments reasonably requested by the Global Administrative Agent to
comply with or accomplish the covenants and agreements of the Borrower or any
Subsidiary, as the case may be, in this Agreement and any other Loan Document,
or to file any notices or obtain any consents, all as may be reasonably
necessary or appropriate in connection therewith.
SECTION 5.6. Performance of Obligations. The Borrower will and will
cause each Loan Party to do and perform every act and discharge all of the
Obligations at the time or times and in the manner specified.
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SECTION 5.7. Reserve Reports.
(a) On or before March 1 of each year, commencing March 1, 2002, the
Borrower shall furnish to the Global Administrative Agent and the Lenders a
Reserve Report.
(b) In the event of a discretionary redetermination or a
redetermination pursuant to clause (i) of Section 2.7(e), the Borrower shall
furnish to the Global Administrative Agent and the Lenders a Reserve Report with
an "as of" date as required by the Global Administrative Agent and prepared by
or under the supervision of the chief engineer of the Borrower who shall certify
such Reserve Report to be true and accurate and to have been prepared in
accordance with the procedures used in the immediately preceding Reserve Report.
The Borrower shall provide such Reserve Reports required by this Section 5.7(b)
as soon as possible, but in any event no later than 30 days following the
receipt of the request by the Global Administrative Agent.
(c) With the delivery of each Reserve Report, the Borrower shall
provide to the Global Administrative Agent and the Lenders, a certificate from
an Authorized Officer certifying that, to the best of his knowledge and in all
material respects: (i) the information contained in the Reserve Report and any
other information delivered in connection therewith is true and correct, (ii)
the Borrower owns good and defensible title to the Oil and Gas Properties
evaluated in such Reserve Report and such Properties are free of all Liens
except for Liens permitted by Section 7.2 and (iii) the report, in form and
substance satisfactory to the Global Administrative Agent, attached as an
exhibit to the certificate, sets forth on a net basis all gas imbalances, take
or pay or other prepayments with respect to the Borrower's and any Subsidiaries'
Oil and Gas Properties evaluated in such Reserve Report which would require the
Borrower or any Subsidiary to deliver Hydrocarbons produced from such Oil and
Gas Properties at some future time without then or thereafter receiving full
payment therefor.
SECTION 5.8. Title to Oil and Gas Properties. The Borrower shall, and
shall cause each Subsidiary to, maintain good and defensible title to its
material (individually or in the aggregate) Oil and Gas Properties, and to do
all things reasonably necessary to cure any material title defects which are not
Liens permitted by Section 7.2 of which the Borrower or any Subsidiary has
knowledge or has been provided notice.
SECTION 5.9. ERISA Information and Compliance. The Borrower will
promptly furnish and will cause the Subsidiaries and any ERISA Affiliate to
promptly furnish to the Global Administrative Agent with sufficient copies to
the Lenders (i) upon request of the Global Administrative Agent, copies of each
annual and other report filed with the United States Secretary of Labor, the
Internal Revenue Service or the PBGC, with respect to each Plan or any trust
created thereunder, (ii) immediately upon becoming aware of the occurrence of
any ERISA Event or of any "prohibited transaction," as described in section 406
of ERISA or in section 4975 of the Code, in connection with any Plan or any
trust created thereunder, a written notice signed by an Authorized Officer
specifying the nature thereof, what action the Borrower, the Subsidiary or the
ERISA Affiliate is taking or proposes to take with respect thereto, and, when
known, any action taken or proposed by the Internal Revenue Service, the
Department of Labor or the PBGC with respect
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thereto, and (iii) immediately upon receipt thereof, copies of any notice of the
PBGC's intention to terminate or to have a trustee appointed to administer any
Plan. With respect to each Plan (other than a Multiemployer Plan), the Borrower
will, and will cause each Subsidiary and ERISA Affiliate to, (i) satisfy in full
and in a timely manner, without incurring any late payment or underpayment
charge or penalty and without giving rise to any lien, all of the contribution
and funding requirements of section 412 of the Code (determined without regard
to subsections (d), (e), (f) and (k) thereof) and of section 302 of ERISA
(determined without regard to sections 303, 304 and 306 of ERISA), and (ii) pay,
or cause to be paid, to the PBGC in a timely manner, without incurring any late
payment or underpayment charge or penalty, all premiums required pursuant to
sections 4006 and 4007 of ERISA.
SECTION 5.10. Additional Subsidiaries. If any additional Subsidiary of
Borrower is formed or acquired after the Global Effective Date, the Borrower
will notify the Global Administrative Agent and the Lenders thereof. If any
Subsidiary as of the date of its formation, its acquisition or at any time
thereafter has a total asset value in excess of U.S.$25,000,000 (or its
equivalent in other currencies) and such Subsidiary owns Oil and Gas Properties
included in the Global Borrowing Base, then the Borrower will cause such
Subsidiary (unless such Subsidiary is a Foreign Subsidiary) to execute a
Guaranty within 30 days after such Subsidiary is formed or acquired or it is
determined to have the requisite total asset value.
SECTION 5.11. Gas Marketing.
(a) After its delivery in compliance with Section 5.1(j), (i) the
Borrower shall not modify the Gas Marketing Policy without the prior written
consent of the Global Administrative Agent and the Required Lenders and (ii)
unless otherwise consented to in writing by the Global Administrative Agent and
the Required Lenders, the Borrower shall, and shall cause each Subsidiary to,
comply with the Gas Marketing Policy.
(b) Except for hedged positions that are closed out with contracts with
the Borrower or one of its Subsidiaries regarding the physical delivery of
Hydrocarbons, the Borrower will not permit the Net Liabilities for all Hedging
Agreements and Marketing Agreements entered into by Borrower and its
Subsidiaries to be greater than U.S.$500,000 at any time.
ARTICLE VI
Financial Covenants
The Borrower agrees with the Global Administrative Agent, the other
Agents, any Issuing Bank, and each Lender that, until the Commitments have
expired or been terminated and Obligations shall have been paid and performed in
full and all Letters of Credit shall have expired or terminated and all LC
Disbursements shall have been reimbursed, the Borrower will perform the
obligations set forth in this Article.
SECTION 6.1. Tangible Net Worth. The Borrower will not permit Tangible
Net Worth at any time to be less than the sum (without duplication) of (i)
U.S.$350,000,000, plus (ii)
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50% of Consolidated Net Income for each fiscal quarter of the Borrower ending
after March 31, 2001 (to the extent for any such fiscal quarter Consolidated Net
Income is positive), plus (iii) 50% of the Net Cash Proceeds of any primary
offering (public or private) of Equity Interests consummated by the Borrower
after the Closing Date.
SECTION 6.2. Indebtedness to EBITDAX Ratio. The Borrower will not
permit its ratio of Indebtedness to EBITDAX as of the end of any fiscal quarter
of the Borrower (calculated quarterly at the end of each fiscal quarter on a
rolling four quarter basis) to be more than 3.0 to 1.0; provided, however, that
for periods of calculation ending on or before December 31, 2001, any
calculation undertaken pursuant to this Section shall be made using an EBITDAX
calculated on a pro forma basis (inclusive of any acquisitions, including the
Acquisition, and/or divestitures, if any, made during the relevant calculation
period as if such acquisition or divestiture had occurred on the first day of
such four-quarter period).
ARTICLE VII
Negative Covenants
The Borrower agrees with the Global Administrative Agent, the other
Agents, any Issuing Bank, and each Lender that, until the Commitments have
expired or been terminated and Obligations shall have been paid and performed in
full and all Letters of Credit shall have expired or terminated and all LC
Disbursements shall have been reimbursed, the Borrower will perform the
obligations set forth in this Article.
SECTION 7.1. Indebtedness. Neither the Borrower nor any Subsidiary will
incur, create, assume or permit to exist any Indebtedness, except:
(a) the Combined Obligations or any Guaranty of or suretyship
arrangement for the Combined Obligations;
(b) Indebtedness of the Borrower existing on the Closing Date which is
disclosed in Schedule 7.1, and any renewals, extensions refinancings or
replacements (but not increases) thereof;
(c) accounts payable and Guarantees thereof (for the deferred purchase
price of Property or services) from time to time incurred in the ordinary course
of business which, if greater than 90 days past due, are being contested in good
faith by appropriate proceedings and for which reserves adequate under GAAP
shall have been established therefor;
(d) Capital Lease Obligations (as required to be reported on the
financial statements of the Borrower pursuant to GAAP) not to exceed
U.S.$5,000,000;
(e) Indebtedness associated with bonds or surety obligations required
by Governmental Rules in connection with the operation of Oil and Gas
Properties;
(f) Indebtedness permitted by Section 7.3;
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(g) Indebtedness of any Subsidiary so long as such Indebtedness is (i)
Non-Recourse Debt and (ii) does not exceed U.S.$40,000,000 in the aggregate
outstanding at any one time;
(h) Hedging Obligations to the extent permitted by Sections 5.11 and
7.17; and
(i) Indebtedness associated with accounts payable overdraft facilities
for TBRL and its Subsidiaries (the "Overdraft Facility") not to exceed
U.S.$5,000,000 at any time and Guarantees thereof by the Borrower; and
(j) Indebtedness of the Borrower or TBRL not otherwise allowed under
this Section 7.1 not to exceed U.S.$25,000,000 outstanding at any one time.
SECTION 7.2. Liens. Neither the Borrower nor any Subsidiary will
create, incur, assume or permit to exist any Lien on any of its Properties (now
owned or hereafter acquired), except:
(a) Liens securing the payment of any of the Combined Obligations;
(b) Excepted Liens;
(c) Liens disclosed on Schedule 7.2;
(d) Liens securing Capital Lease Obligations allowed under Section
7.1(d), but only on the Property under lease;
(e) Liens on the Equity Interests or Properties of any Subsidiary
securing Indebtedness permitted by Section 7.1(g);
(f) Liens permitted by any of the Combined Loan Documents; and
(g) other Liens securing obligations not in excess of U.S.$5,000,000 in
the aggregate.
SECTION 7.3. Investments. Neither the Borrower nor any Subsidiary will
make or permit to remain outstanding any Investment in any Person, except that
the foregoing restriction shall not apply to:
(a) Investments which are disclosed in the Financial Statements;
(b) accounts receivable arising in the ordinary course of business;
(c) direct obligations of the United States or Canada or any province
of Canada or any agency thereof, or obligations Guaranteed by the United States
or Canada or any province of Canada or any agency thereof, in each case maturing
within one year from the date of acquisition thereof;
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(d) commercial paper maturing within one year from the date of creation
thereof rated at least "A-2", "P-2", "R-1 low" or "A-1" by S&P, ▇▇▇▇▇'▇,
Dominion Bond Rating Service Limited or Canada Bond Rating Service,
respectively;
(e) deposits maturing within one year from the date of acquisition
thereof with, including certificates of deposit issued by, any Lender or any
office located in the United States or Canada of any other bank or trust company
which is organized under the laws of the United States or Canada or any state or
province thereof, has capital and surplus aggregating at least U.S.$500,000,000
(as of the date of such Lender's or bank or trust company's most recent
financial reports) and has a short term deposit rating of no lower than "A-2",
"P-2", "R-1 low" or "A-1", as such rating is set forth from time to time, by
S&P, ▇▇▇▇▇'▇, Dominion Bond Rating Service Limited or Canada Bond Rating
Service, respectively;
(f) deposits in money market or similar funds investing exclusively in
Investments described in Section 7.3(c), 7.3(d) or 7.3(e);
(g) (i) repurchase obligations of any Lender or of any commercial bank
satisfying the requirements of Section 7.3(e); (ii) securities with maturities
of one year or less from the date of acquisition issued or fully Guaranteed by
any state, commonwealth, province or territory of the United States or Canada,
by any political subdivision or taxing authority of any such state,
commonwealth, province or territory or by any foreign government, the securities
of which state, commonwealth, province, territory, political subdivision, taxing
authority or foreign government (as the case may be) are rated at least "A",
"P-1", or "R-1 low" by S&P, ▇▇▇▇▇'▇, Dominion Bond Rating Service Limited or
Canada Bond Rating Service, respectively; (iii) securities with effective
maturities of one year or less from the date of acquisition backed by an
"Aaa/AAA" insurer or standby letters of credit issued by any Lender or any
commercial bank satisfying the requirements of Section 7.3(e); and (iv)
securities with maturities of six months or less from the date of acquisition
overcollateralized with government obligations of the United States or Canada as
collateral;
(h) Investments made by the Borrower in or to its Subsidiaries (other
than Subsidiaries which are obligated with respect to any Non-Recourse Debt) or
by any Subsidiary in and to the Borrower or any other Subsidiary (other than
Subsidiaries which are obligated with respect to any Non-Recourse Debt);
(i) Investments made by any Subsidiary liable in respect of
Non-Recourse Debt in any of its Subsidiaries;
(j) Investments by the Borrower or any Subsidiary in direct ownership
interests in additional Oil and Gas Properties and gas gathering systems related
thereto or in Persons owning Oil and Gas Properties provided that after giving
effect thereto such Person is a Wholly-Owned Subsidiary; and
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(k) other Investments by the Borrower or any Subsidiary in or to any
other Persons not to exceed U.S.$25,000,000 in the aggregate at any time;
provided, however, that Investments to Persons who are not Subsidiaries shall
not exceed U.S.$10,000,000 in the aggregate at any time outstanding, net of
dividends or other returns of capital or return on Investments.
SECTION 7.4. Dividends, Distributions and Redemptions. The Borrower
will not declare or pay any dividend, purchase, redeem or otherwise acquire for
value any of its stock now or hereafter outstanding, return any capital to its
stockholders or make any distribution of its assets to its stockholders, except
that so long as no Default exists or would result therefrom, the Borrower may
pay (i) dividends in shares of Equity Interests of the Borrower and (ii) the
Borrower may repurchase Equity Interests of the Borrower in an aggregate
principal amount not to exceed U.S.$30,000,000.
SECTION 7.5. Sales and Leasebacks. Neither the Borrower nor any
Subsidiary will enter into any arrangement, directly or indirectly, with any
Person whereby the Borrower or any Subsidiary shall sell or transfer any of its
Property, whether now owned or hereafter acquired, and whereby the Borrower or
any Subsidiary shall then or thereafter rent or lease as lessee such Property or
any part thereof or other Property which the Borrower or any Subsidiary intends
to use for substantially the same purpose or purposes as the Property sold or
transferred.
SECTION 7.6. Nature of Business. Neither the Borrower nor any
Subsidiary will allow any material change to be made in the character of its
business as an independent oil and gas exploration and production, gas gathering
and processing or marketing company.
SECTION 7.7. Limitation on Leases. Neither the Borrower nor any
Subsidiary will create, incur, assume or permit to exist any obligation for the
payment of rent or hire of Property of any kind whatsoever (real or personal,
but excluding leases of Hydrocarbon Interests, oil and gas operating agreements
and Capital Lease Obligations), under leases or lease agreements which would
cause the aggregate amount of all payments made by the Borrower and its
Subsidiaries pursuant to all such leases or lease agreements to exceed
U.S.$10,000,000 in any period of twelve consecutive calendar months during the
life of such leases.
SECTION 7.8. Mergers, Etc. Neither the Borrower nor any Subsidiary will
merge into or with or consolidate with any other Person, or sell, lease or
otherwise dispose of (whether in one transaction or in a series of transactions)
all or substantially all of its Property or assets to any other Person, except
(i) any Subsidiary of the Borrower may be merged or consolidated with or into
the Borrower (provided that the Borrower shall be the continuing or surviving
corporation) or with or into any one or more Wholly-Owned Subsidiaries of the
Borrower (provided that the Wholly-Owned Subsidiary or Subsidiaries shall be the
continuing or surviving corporation), and (ii) any Subsidiary may sell, lease,
transfer or otherwise dispose of any or all of its assets (upon voluntary
liquidation or otherwise) to the Borrower or any Wholly-Owned Subsidiary of the
Borrower.
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SECTION 7.9. Proceeds of Loans and Letters of Credit. The Borrower will
not permit the proceeds of the Loans or Letters of Credit to be used for any
purpose other than those permitted by Section 3.7. Neither the Borrower nor any
Person acting on behalf of the Borrower has taken or will take any action which
might cause any of the Loan Documents to violate Regulation U or any other
regulation of the Board or to violate Section 7 of the Securities Exchange Act
of 1934 or any rule or regulation thereunder, in each case as now in effect or
as the same may hereinafter be in effect.
SECTION 7.10. ERISA Compliance. The Borrower will not at any time do
any of the following if such action or inaction could reasonably be expected to
have a Material Adverse Effect:
(a) Engage in, or permit any Subsidiary or ERISA Affiliate to engage
in, any transaction in connection with which the Borrower, any Subsidiary or any
ERISA Affiliate could be subjected to either a civil penalty assessed pursuant
to section 502(c), (i) or (l) of ERISA or a tax imposed by Chapter 43 of
Subtitle D of the Code;
(b) Terminate, or permit any Subsidiary or ERISA Affiliate to
terminate, any Plan in a manner, or take any other action with respect to any
Plan, which could result in any liability to the Borrower, any Subsidiary or any
ERISA Affiliate to the PBGC;
(c) Fail to make, or permit any Subsidiary or ERISA Affiliate to fail
to make, full payment when due of all amounts which, under the provisions of any
Plan, agreement relating thereto or applicable law, the Borrower, a Subsidiary
or any ERISA Affiliate is required to pay as contributions thereto;
(d) Permit to exist, or allow any Subsidiary or ERISA Affiliate to
permit to exist, any accumulated funding deficiency within the meaning of
section 302 of ERISA or section 412 of the Code, whether or not waived, with
respect to any Plan;
(e) Permit, or allow any Subsidiary or ERISA Affiliate to permit, the
actuarial present value of the benefit liabilities under any Plan maintained by
the Borrower, any Subsidiary or any ERISA Affiliate which is regulated under
Title IV of ERISA to exceed the current value of the assets (computed on a plan
termination basis in accordance with Title IV of ERISA) of such Plan allocable
to such benefit liabilities. The term "actuarial present value of the benefit
liabilities" shall have the meaning specified in section 4041 of ERISA;
(f) Contribute to or assume an obligation to contribute to, or permit
any Subsidiary or ERISA Affiliate to contribute to or assume an obligation to
contribute to, any Multiemployer Plan;
(g) Acquire, or permit any Subsidiary or ERISA Affiliate to acquire, an
interest in any Person that causes such Person to become an ERISA Affiliate with
respect to the Borrower, any Subsidiary or any ERISA Affiliate if such Person
sponsors, maintains or contributes to, or at any time in the six-year period
preceding such acquisition has sponsored, maintained, or contributed to, (1) any
Multiemployer Plan, or (2) any other Plan that is subject to Title IV of ERISA
under which
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the actuarial present value of the benefit liabilities under such Plan exceeds
the current value of the assets (computed on a plan termination basis in
accordance with Title IV of ERISA) of such Plan allocable to such benefit
liabilities;
(h) Incur, or permit any Subsidiary or ERISA Affiliate to incur, a
liability to or on account of a Plan under sections 515, 4062, 4063, 4064, 4201
or 4204 of ERISA;
(i) Contribute to or assume an obligation to contribute to, or permit
any Subsidiary or ERISA Affiliate to contribute to or assume an obligation to
contribute to, any employee welfare benefit plan, as defined in section 3(1) of
ERISA, including, without limitation, any such plan maintained to provide
benefits to former employees of such entities, that may not be terminated by
such entities in their sole discretion at any time without any material
liability; or
(j) Amend or permit any Subsidiary or ERISA Affiliate to amend, a Plan
resulting in an increase in current liability such that the Borrower, any
Subsidiary or any ERISA Affiliate is required to provide security to such Plan
under section 401(a)(29) of the Code.
SECTION 7.11. Sale or Discount of Receivables. Neither the Borrower nor
any Subsidiary will discount or sell (with or without recourse) any of its notes
receivable or accounts receivable.
SECTION 7.12. Sale of Oil and Gas Properties. The Borrower will not,
and will not permit any Subsidiary to, sell, assign, farm-out, convey or
otherwise transfer any Oil and Gas Property or any interest in any Oil and Gas
Property, except for (i) the sale of Hydrocarbons in the ordinary course of
business; (ii) the sale or transfer of equipment that is obsolete, worn out,
depleted or uneconomic and disposed of in the ordinary course of business; (iii)
the sale, assignment, farm-out, conveyance or other transfer of any undeveloped
acreage for which no Global Borrowing Base value was given in the most recent
determination of the Global Borrowing Base; (iv) during any 12 consecutive month
period, sales of Oil and Gas Properties or all of the Equity Interests of any
Subsidiary owning Oil and Gas Properties, provided such sales shall not exceed
in the aggregate 10% of the amount of the then current Global Borrowing Base and
Borrower shall provide the Global Administrative Agent with notice of such sales
in accordance with Section 5.1(i); (v) the sale of gas gathering and processing
systems assets; and (vi) dispositions permitted by Section 7.8.
SECTION 7.13. Environmental Matters. Neither the Borrower nor any
Subsidiary will cause or permit any of its Property to be in violation of, or do
anything or permit anything to be done which will subject any such Property to
any remedial obligations under any applicable Environmental Laws, assuming
disclosure to the applicable Governmental Authority of all relevant facts,
conditions and circumstances, if any, pertaining to such Property where such
violations or remedial obligations could reasonably be expected to have a
Material Adverse Effect.
SECTION 7.14. Transactions with Affiliates. Neither the Borrower nor
any Subsidiary will enter into any transaction, including, without limitation,
any purchase, sale, lease or exchange of Property or the rendering of any
service, with any Affiliate (other than a Subsidiary) unless such
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transactions are otherwise permitted under this Agreement or the other Combined
Loan Documents, are in the ordinary course of its business and are upon fair and
reasonable terms no less favorable to it than it would obtain in a comparable
arm's length transaction with a Person not an Affiliate.
SECTION 7.15. Subsidiaries. The Borrower shall not, and shall not
permit any Subsidiary to, create any additional Subsidiaries except in
accordance with Section 5.10.
SECTION 7.16. Negative Pledge Agreements. Except for (i) any Capital
Lease Obligations permitted by Section 7.1(d), (ii) agreements pursuant to which
Indebtedness permitted by Section 7.1(g) is incurred (in which cases, any
prohibition or limitation shall only be effective against the assets finance
thereby) and (iii) agreements pursuant to which Investments permitted by
Sections 7.3(h) or (i) are made, neither the Borrower nor any Subsidiary will
create, incur, assume or permit to exist any contract, agreement or
understanding (other than this Agreement and the other Combined Loan Documents)
which in any way prohibits or restricts the granting, conveying, creation or
imposition of any Lien on any of its Property in favor of the Global
Administrative Agent and the Lenders or restricts any Subsidiary from paying
dividends to the Borrower, or which requires the consent of or notice to other
Persons in connection therewith.
SECTION 7.17. Hedging Agreements.
(a) Neither the Borrower nor any Subsidiary will enter into any Hedging
Agreements, except where such agreements are entered into in the ordinary course
of business (and not for speculative purposes) and designed to protect the
Borrower or any of its Subsidiaries against fluctuations in Hydrocarbon prices,
currency exchange rates and interest rates; provided, that (i) with respect to
Hedging Agreements relating to crude oil in place that the aggregate amount of
volumes of Hydrocarbons subject to such Hedging Agreements shall not exceed 75%
of the anticipated production from the Borrower's and its Subsidiaries'
Hydrocarbons constituting "proved developed producing oil and gas reserves" (as
defined in the standards and guidelines of the SEC) for the period covered by
such Hedging Agreements and (ii) with respect to Hedging Agreements relating to
natural gas in place that the aggregate amount of volumes of Hydrocarbons
subject to such Hedging Agreements shall not exceed 75% of the anticipated
production from the Borrower's and its Subsidiaries' Hydrocarbons constituting
"proved developed producing oil and gas reserves" (as defined in the standards
and guidelines of the SEC) for the period covered by such Hedging Agreements;
and provided, further, if the Borrower or any of its Subsidiaries enters into a
Hedging Agreement with a Lender, or an Affiliate thereof, the Hedging
Obligations of the Borrower or such Subsidiary under such Hedging Agreement will
rank pari passu with the Obligations under this Agreement.
(b) Borrower will not, and will not permit any of its Subsidiaries, to
enter into a Hedging Agreement (i) which creates any Lien other than pursuant to
any Combined Loan Document or as permitted by Section 7.2(g) or (ii) with a
counterparty with a rating of its senior, unsecured, long-term indebtedness for
borrowed money that is not guaranteed by any other Person or subject to any
other credit enhancement of lower than "BBB-" or Baa3" by S&P and ▇▇▇▇▇'▇,
respectively.
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ARTICLE VIII
Events of Default
SECTION 8.1. Listing of Events of Default. Each of the following events
or occurrences described in this Section 8.1 shall constitute an "Event of
Default":
(a) any Loan Party shall default in the payment or prepayment when due
of any principal of or interest on any Loan, or any reimbursement obligation for
a disbursement made under any Letter of Credit, or any fees or other amount
payable by it hereunder or under any other Loan Document and such default, other
than a default of a payment or prepayment of principal (which shall have no cure
period), shall continue unremedied for a period of five days; or
(b) any Loan Party shall default in the payment when due of any
principal of or interest on any of its other Indebtedness (other than
Non-Recourse Debt) aggregating U.S.$10,000,000 or more, or any event specified
in any note, agreement, indenture or other document evidencing or relating to
any such Indebtedness shall occur if the effect of such event is to cause, or
(with the giving of any notice or the lapse of time or both) to permit the
holder or holders of such Indebtedness (or a trustee or agent on behalf of such
holder or holders) to cause after giving effect to all applicable grace periods,
such Indebtedness to become due prior to its stated maturity; or
(c) any representation, warranty or certification made or deemed made
herein or in any other Combined Loan Document by any Loan Party, or any
certificate furnished to any Lender or the Global Administrative Agent pursuant
to the provisions hereof or any other Combined Loan Document, shall prove to
have been false or misleading as of the time made, deemed made or furnished in
any material respect; or
(d) the Borrower shall default in the performance of any of its
obligations under Article VII, any other Article of this Agreement other than
under Article V, or the Borrower shall default in the performance of any of its
obligations under Article V or any Loan Party shall default in the performance
of its obligations under any other Loan Document (other than the payment of
amounts due which shall be governed by Section 8.1(a)) and such default shall
continue unremedied for a period of thirty (30) days after the earlier to occur
of (i) notice thereof to the Borrower by the Global Administrative Agent or any
Lender (through the Global Administrative Agent), or (ii) the Borrower otherwise
becoming aware of such default; or
(e) the Borrower shall admit in writing its inability to, or be
generally unable to, pay its debts as such debts become due; or
(f) the Borrower shall (i) apply for or consent to the appointment of,
or the taking of possession by, a receiver, custodian, trustee or liquidator of
itself or of all or a substantial part of its property, (ii) make a general
assignment for the benefit of its creditors, (iii) commence a voluntary case
under the Federal Bankruptcy Code (as now or hereafter in effect), (iv) file a
petition seeking to take advantage of any other law relating to bankruptcy,
insolvency, reorganization, winding-up, liquidation or composition or
readjustment of debts, (v) fail to controvert in a timely and appropriate
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manner, or acquiesce in writing to, any petition filed against it in an
involuntary case under the Federal Bankruptcy Code, or (vi) take any corporate
action for the purpose of effecting any of the foregoing; or
(g) a proceeding or case shall be commenced, without the application or
consent of the Borrower, in any court of competent jurisdiction, seeking (i) its
liquidation, reorganization, dissolution or winding-up, or the composition or
readjustment of its debts, (ii) the appointment of a trustee, receiver,
custodian, liquidator or the like of the Borrower of all or any substantial part
of its assets, or (iii) similar relief in respect of the Borrower under any law
relating to bankruptcy, insolvency, reorganization, winding-up, or composition
or adjustment of debts, and such proceeding or case shall continue undismissed,
or an order, judgment or decree approving or ordering any of the foregoing shall
be entered and continue unstayed and in effect, for a period of 60 days; or (iv)
an order for relief against the Borrower shall be entered in an involuntary case
under the Federal Bankruptcy Code; or
(h) a judgment or judgments for the payment of money in excess of
U.S.$10,000,000 in the aggregate shall be rendered by a court against any Loan
Party and the same shall not be discharged (or provision shall not be made for
such discharge), or a stay of execution thereof shall not be procured, within 60
days from the date of entry thereof and such Loan Party shall not, within said
period of 60 days, or such longer period during which execution of the same
shall have been stayed, appeal therefrom and cause the execution thereof to be
stayed during such appeal; or
(i) any Loan Party takes, suffers or permits to exist any of the events
or conditions referred to in paragraphs (e), (f) or (g) or if any Loan Party
shall so state in writing; or
(j) a Change of Control shall occur; or
(k) the Liens created by the Combined Security Documents shall at any
time not constitute a valid and perfected Lien on the collateral intended to be
covered thereby (to the extent perfection by filing, registration, recordation
or possession is required herein or therein) in favor of the Global
Administrative Agent or, except for expiration in accordance with its terms, any
of the Security Documents shall for whatever reason be terminated or cease to be
in full force and effect, or the enforceability thereof shall be contested by
any Loan Party; or
(l) any "Default" or "Event of Default" as defined in either the
Canadian Revolving Loan Documents or the Canadian Term Loan Documents shall
occur; provided that if such "Default" or "Event of Default" is cured or waived
under the Canadian Revolving Loan Documents or the Canadian Term Loan Documents,
as applicable, then such "Default" or 'Event of Default" shall no longer
constitute a Default or an Event of Default, respectively, under this Agreement.
SECTION 8.2. Action if Bankruptcy. If any Event of Default described in
Section 8.1(g) with respect to Borrower shall occur, the Commitments (if not
theretofore terminated) shall automatically terminate and the outstanding
principal amount of all outstanding Loans and all other obligations hereunder
shall automatically be and become immediately due and payable,
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without demand, protest or presentment or notice of any kind, all of which are
hereby expressly waived by the Borrower and its Subsidiaries. Without limiting
the foregoing, the Agents and the Lenders shall be entitled to exercise any and
all other remedies available to them under the Loan Documents and applicable
law.
SECTION 8.3. Action if Other Event of Default. If any Event of Default
(other than any Event of Default described in Section 8.1(g)) shall occur for
any reason, whether voluntary or involuntary, and be continuing, the Required
Lenders may, by notice to the Borrower, declare (a) the Commitments (if not
theretofore terminated) to be terminated and/or (b) all of the outstanding
principal amount of the Loans and all other obligations hereunder to be due and
payable, whereupon the Commitments shall terminate and the full unpaid amount of
such Loans and other obligations shall be and become immediately due and
payable, without demand, protest or presentment or notice of any kind, all of
which are hereby waived by the Borrower and its Subsidiaries. Without limiting
the foregoing, the Agents and the Lenders shall be entitled to exercise any and
all other remedies available to them under the Loan Documents and applicable
law.
ARTICLE IX
Agents
Each of the Lenders, the Issuing Banks and the other Agents hereby
irrevocably appoints The Chase Manhattan Bank as the Global Administrative
Agent, U.S. Bank National Association, as U.S. Syndication Agent, BNP Paribas as
U.S. Documentation Agent, and authorizes each such Agent to take such actions on
its behalf and to exercise such powers as are delegated to such Agent by the
terms of the Loan Documents, together with such actions and powers as are
reasonably incidental thereto.
Any bank serving as an Agent hereunder shall have the same rights and
powers in its capacity as a Lender as any other Lender and may exercise the same
as though it were not an Agent, and such bank and its Affiliates may accept
deposits from, lend money to and generally engage in any kind of business with
the Borrower or any Subsidiary or other Affiliate thereof as if it were not an
Agent hereunder.
The Agents shall not have any duties or obligations except those
expressly set forth in the Loan Documents. Without limiting the generality of
the foregoing, (a) the Agents shall not be subject to any fiduciary or other
implied duties, regardless of whether a Default has occurred and is continuing,
(b) each Agent shall not have any duty to take any discretionary action or
exercise any discretionary powers, except discretionary rights and powers
expressly contemplated by the Loan Documents that such Agent is required to
exercise following its receipt of written instructions from the Required Lenders
(or such other number or percentage of the Combined Lenders as shall be
necessary under the circumstances as provided in Section 10.2), and (c) except
as expressly set forth in the Loan Documents, the Agents shall not have any duty
to disclose, and shall not be liable for the failure to disclose, any
information relating to the Borrower or any of its Subsidiaries that is
communicated to or obtained by the bank serving as such Agent or any of its
Related Parties in any capacity. Each Agent shall not be liable for any action
taken or not taken by it with the consent or
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at the request of the Required Lenders (or such other number or percentage of
the Combined Lenders as shall be necessary under the circumstances as provided
in Section 10.2) or in the absence of its own gross negligence or wilful
misconduct; PROVIDED, HOWEVER, THAT IT IS THE INTENTION OF THE PARTIES HERETO
THAT EACH OF THE AGENTS BE INDEMNIFIED IN THE CASE OF ITS OWN NEGLIGENCE (OTHER
THAN GROSS NEGLIGENCE), REGARDLESS OF WHETHER SUCH NEGLIGENCE IS SOLE OR
CONTRIBUTORY, ACTIVE OR PASSIVE, IMPUTED, JOINT OR TECHNICAL. Each Agent shall
be deemed not to have knowledge of any Default unless and until written notice
thereof is given to such Agent by the Borrower or a Lender, and such Agent shall
not be responsible for or have any duty to ascertain or inquire into (i) any
statement, warranty or representation made in or in connection with any Loan
Document, (ii) the contents of any certificate, report or other document
delivered thereunder or in connection therewith, (iii) the performance or
observance of any of the covenants, agreements or other terms or conditions set
forth in any Loan Document, (iv) the validity, enforceability, effectiveness or
genuineness of any Loan Document or any other agreement, instrument or document,
or (v) the satisfaction of any condition set forth in Article IV or elsewhere in
any Loan Document, other than to confirm receipt of items expressly required to
be delivered to such Agent.
The Global Administrative Agent and the other Agents shall be entitled
to rely upon, and shall not incur any liability for relying upon, any notice,
request, certificate, consent, statement, instrument, document or other writing
believed by it to be genuine and to have been signed or sent by the proper
Person. The Global Administrative Agent and the other Agents also may rely upon
any statement made to it orally or by telephone and believed by it to be made by
the proper Person, and shall not incur any liability for relying thereon. The
Global Administrative Agent and the other Agents may consult with legal counsel
(who may be counsel for the Borrower), independent accountants and other experts
selected by it, and shall not be liable for any action taken or not taken by it
in accordance with the advice of any such counsel, accountants or experts.
Any Agent may perform any and all its duties and exercise its rights
and powers by or through any one or more sub-agents appointed by such Agent. Any
Agent and any such sub-agent may perform any and all its duties and exercise its
rights and powers through their respective Related Parties. The exculpatory
provisions of the preceding paragraphs shall apply to any such sub-agent and to
the Related Parties of such Agent and any such sub-agent, and shall apply to
their respective activities in connection with the syndication of the credit
facilities provided for herein as well as activities as an Agent.
Subject to the appointment and acceptance of a successor Global
Administrative Agent as provided in this paragraph, the Global Administrative
Agent may resign at any time by notifying the Combined Lenders and the Borrower.
Upon any such resignation, the Required Lenders shall have the right, in
consultation with the Borrower, to appoint a successor. If no successor shall
have been so appointed by the Required Lenders and shall have accepted such
appointment within 30 days after the retiring Global Administrative Agent gives
notice of its resignation, then the retiring Global Administrative Agent may, on
behalf of the Combined Lenders and the Issuing Banks, appoint a successor Global
Administrative Agent which shall be a bank with an office in
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New York, City, or an Affiliate of any such bank. Upon the acceptance of its
appointment as Global Administrative Agent hereunder by a successor, such
successor shall succeed to and become vested with all the rights, powers,
privileges and duties of the retiring Global Administrative Agent, and the
retiring Global Administrative Agent shall be discharged from its duties and
obligations hereunder (other than its obligations under Section 10.12). The fees
payable by the Borrower to a successor Global Administrative Agent shall be the
same as those payable to its predecessor unless otherwise agreed between the
Borrower and such successor. After the Global Administrative Agent's resignation
hereunder, the provisions of this Article and Section 10.3 shall continue in
effect for the benefit of such retiring Global Administrative Agent, its
sub-agents and their respective Related Parties in respect of any actions taken
or omitted to be taken by any of them while it was acting as Global
Administrative Agent.
Each Lender acknowledges that it has, independently and without
reliance upon any Agent or any other Lender and based on such documents and
information as it has deemed appropriate, made its own credit analysis and
decision to enter into this Agreement and the Intercreditor Agreement. 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 from time to time deem appropriate, continue to make its own decisions in
taking or not taking action under or based upon this Agreement, any other Loan
Document or any related agreement or any document furnished hereunder or
thereunder.
Each of the Lenders, for itself and on behalf of any of its Affiliates,
and the Issuing Banks hereby irrevocably appoints the Global Administrative
Agent to act as its agent under the Intercreditor Agreement and authorizes the
Global Administrative Agent to execute the Intercreditor Agent on its behalf and
to take such actions on its behalf and to exercise such powers as are delegated
to the Global Administrative Agent by the terms hereof and thereof, together
with such actions and powers as are reasonably incidental thereto.
ARTICLE X
Miscellaneous
SECTION 10.1. Notices. Except in the case of notices and other
communications expressly permitted to be given by telephone, all notices and
other communications provided for herein shall be in writing and shall be
delivered by hand or overnight courier service, mailed by certified or
registered mail or sent by telecopy, as follows:
(a) if to the Borrower, to:
▇▇▇ ▇▇▇▇▇, Inc.
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇, Executive Vice President,
Treasurer and Chief Financial Officer
Telephone: ▇▇▇-▇▇▇-▇▇▇▇
Facsimile: ▇▇▇-▇▇▇-▇▇▇▇
e-mail: ▇▇▇▇▇▇▇▇▇▇@▇▇▇▇▇▇▇▇.▇▇▇
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(b) if to the Global Administrative Agent, to:
The Chase Manhattan Bank
Loan and Agency Services
One Chase ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Telephone: ▇▇▇-▇▇▇-▇▇▇▇
Facsimile: ▇▇▇-▇▇▇-▇▇▇▇
with a copy to:
The Chase Manhattan Bank
Global Oil & Gas Group
▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇▇▇
Telephone: ▇▇▇-▇▇▇-▇▇▇▇
Facsimile: ▇▇▇-▇▇▇-▇▇▇▇
and, with respect to non-Borrowing related matters, with a copy to:
The Chase Manhattan Bank
Global Oil & Gas Group
▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇
Telephone: ▇▇▇-▇▇▇-▇▇▇▇
Facsimile: ▇▇▇-▇▇▇-▇▇▇▇
(c) if to the Syndication Agent:
U.S. Bank National Association
CNBB 0300
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Telephone: ▇▇▇-▇▇▇-▇▇▇▇
Facsimile: ▇▇▇-▇▇▇-▇▇▇▇
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(d) if to the Documentation Agent:
BNP Paribas
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇
Telephone: ▇▇▇-▇▇▇-▇▇▇▇
Facsimile: ▇▇▇-▇▇▇-▇▇▇▇
(e) if to any other Lender, to it at its address (or telecopy number)
provided to the Global Administrative Agent and the Borrower or as set forth in
its Administrative Questionnaire; and
(f) if to any Canadian Revolving Lender or Canadian Term Lender, to it
at its address (or telecopy number) provided to the Canadian Administrative
Agent and the Canadian Borrowers or as set forth in its "Administrative
Questionnaire" as defined in the Canadian Revolving Credit Agreement or Canadian
Term Credit Agreement, as applicable.
Any party hereto may change its address or telecopy number for notices and other
communications hereunder by notice to the other parties hereto. All notices and
other communications given to any party hereto in accordance with the provisions
of this Agreement shall be deemed to have been given on the date of receipt.
SECTION 10.2. Waivers; Amendments.
(a) No failure or delay by the Global Administrative Agent, any Issuing
Bank or any Lender in exercising any right or power hereunder or under any other
Loan Document shall operate as a waiver thereof, nor shall any single or partial
exercise of any such right or power, or any abandonment or discontinuance of
steps to enforce such a right or power, preclude any other or further exercise
thereof or the exercise of any other right or power. The rights and remedies of
the Global Administrative Agent, the Issuing Banks and the Lenders hereunder and
under the other Loan Documents are cumulative and are not exclusive of any
rights or remedies that they would otherwise have. No waiver of any provision of
any Loan Document or consent to any departure by any Loan Party therefrom shall
in any event be effective unless the same shall be permitted by paragraph (b) of
this Section, and then such waiver or consent shall be effective only in the
specific instance and for the purpose for which given. Without limiting the
generality of the foregoing, the making of a Loan or issuance of a Letter of
Credit shall not be construed as a waiver of any Default, regardless of whether
the Global Administrative Agent, any Lender or any Issuing Bank may have had
notice or knowledge of such Default at the time.
(b) Neither this Agreement nor any of the Combined Loan Documents nor
any provision hereof or thereof may be waived, amended or modified except, in
the case of this Agreement, pursuant to an agreement or agreements in writing
entered into by the Borrower and the Required Lenders or by the Borrower and the
Global Administrative Agent with the consent of the Required Lenders, or, in the
case of any other Combined Loan Document, pursuant to an agreement or agreements
in writing entered into by the relevant Loan Parties thereto and the Required
Lenders
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or by the relevant Loan Parties thereto and the Global Administrative Agent with
the consent of the Required Lenders, provided that no such agreement shall (i)
increase the Commitment of any Lender without the written consent of such
Lender, (ii) reduce the principal amount of any Loan or LC Disbursement or
reduce the rate of interest thereon, or reduce any fees payable hereunder,
without the written consent of each Lender affected thereby, (iii) postpone the
scheduled date of payment of the principal amount of any Loan or LC
Disbursement, or any interest thereon, or any fees payable hereunder, or reduce
the amount of, waive or excuse any such payment, or postpone the scheduled date
of expiration of any Commitment, without the written consent of each Lender
affected thereby, (iv) change Section 2.18(b) or (c) in a manner that would
alter the pro rata sharing of payments required thereby, without the written
consent of each Lender, (v) change any of the provisions of this Section 10.2,
Section 2.7, 2.10 or the definition of "Combined Lenders," "Combined Revolving
Lenders," "Required Lenders," "Majority Lenders" or "Super Majority Lenders" or
any other provision of any Combined Loan Document specifying the number or
percentage of Lenders, Canadian Revolving Lenders, Canadian Term Lenders,
Combined Lenders or Combined Revolving Lenders required to determine or
redetermine the Global Borrowing Base or the Revolving Borrowing Base or
required to waive, amend or modify any rights thereunder or make any
determination or grant any consent thereunder, without the written consent of
each Combined Lender, (vi) release any Loan Party from its Guaranty (except as
expressly provided in such Guaranty), or limit its liability in respect of such
Guaranty, without the written consent of each Combined Lender, or (vii) except
as expressly provided herein, in the Intercreditor Agreement or in the Security
Documents (as defined herein and in each other Combined Credit Agreement),
release all or any part of the Collateral from the Liens of the Security
Documents (as defined herein and in each other Combined Credit Agreement),
without the written consent of each Combined Lender; provided further that no
such agreement shall amend, waive, modify or otherwise affect the rights or
duties of any Agent (as defined herein and in each other Combined Credit
Agreement) or any Issuing Bank (as defined herein and in each other Combined
Credit Agreement) without the prior written consent of such Agent (as defined
herein and in each other Combined Credit Agreement) or any Issuing Bank (as
defined herein and in each other Combined Credit Agreement), as the case may be;
provided further that the Global Administrative Agent shall have the right to
execute and deliver any release of Lien (or other similar instrument) without
the consent of any Lender to the extent such release is required to permit the
Borrower or a Subsidiary to consummate a transaction permitted by this Agreement
or the other Combined Loan Documents.
SECTION 10.3. Expenses; Indemnity; Damage Waiver.
(a) The Borrower shall pay (i) all legal, printing, recording,
syndication, travel, advertising and other reasonable out-of-pocket expenses
incurred by the Agents, the Arranger and their Affiliates, including the
reasonable fees, charges and disbursements of counsel for the Agents and the
Arranger, in connection with the syndication of the credit facilities provided
for herein, the preparation, execution, delivery and administration of this
Agreement, the Loan Documents and each other document or instrument relevant to
this Agreement or the Loan Documents and any amendments, modifications or
waivers of the provisions hereof or thereof (whether or not the transactions
contemplated hereby or thereby shall be consummated), (ii) all reasonable
out-of-pocket expenses incurred by an Issuing Bank in connection with the
issuance, amendment, renewal or
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extension of any Letter of Credit or any demand for payment thereunder, (iii)
the filing, recording, refiling or rerecording of the Pledge Agreement and the
other Security Documents and/or any Uniform Commercial Code financing statements
relating thereto and all amendments, supplements and modifications to, and all
releases and terminations of, any thereof and any and all other documents or
instruments of further assurance required to be filed or recorded or refiled or
rerecorded by the terms hereof or of the Pledge Agreement and the other Security
Documents, and (iv) all reasonable out-of-pocket expenses incurred by the
Agents, any Issuing Bank or any Lender, including the fees, charges and
disbursements of any counsel for the Agents, any Issuing Bank or any Lender, in
connection with the enforcement or protection of its rights in connection with
the Loan Documents, including its rights under this Section, or in connection
with the Loans made or Letters of Credit issued hereunder, including all such
reasonable out-of-pocket expenses incurred during any workout, restructuring or
negotiations in respect of such Loans or Letters of Credit.
(b) The Borrower shall indemnify the Agents, each Issuing Bank, the
Arranger and each Lender, and each Related Party of any of the foregoing Persons
(each such Person being called an "Indemnitee") against, and hold each
Indemnitee harmless from, any and all losses, claims, damages, liabilities and
related expenses, including the reasonable out-of-pocket fees, charges and
disbursements of any counsel for any Indemnitee, incurred by or asserted against
any Indemnitee arising out of, in connection with, or as a result of (i) the
execution or delivery of any Loan Document or any other agreement or instrument
contemplated hereby, the performance by the parties to the Loan Documents of
their respective obligations thereunder or the consummation of the Financing
Transactions or any other transactions contemplated hereby, (ii) any Loan or
Letter of Credit or the use of the proceeds therefrom (including any refusal by
an Issuing Bank to honor a demand for payment under a Letter of Credit if the
documents presented in connection with such demand do not strictly comply with
the terms of such Letter of Credit), (iii) any actual or alleged presence or
release of Hazardous Materials on or from any property currently or formerly
owned or operated by the Borrower or any of its Subsidiaries, or any
Environmental Liability related in any way to the Borrower or any of its
Subsidiaries, or (iv) any actual or prospective claim, litigation, investigation
or proceeding relating to any of the foregoing, whether based on contract, tort
or any other theory and regardless of whether any Indemnitee is a party thereto;
provided that such indemnity and release shall not, as to any Indemnitee, be
available to the extent that such losses, claims, damages, liabilities or
related expenses are determined by a court of competent jurisdiction by final
and nonappealable judgment to have resulted from the gross negligence or wilful
misconduct of such Indemnitee (IT BEING UNDERSTOOD THAT IT IS THE INTENTION OF
THE PARTIES HERETO THAT EACH OF THE INDEMNITEES BE INDEMNIFIED IN THE CASE OF
ITS OWN NEGLIGENCE (OTHER THAN GROSS NEGLIGENCE), REGARDLESS OF WHETHER SUCH
NEGLIGENCE IS SOLE OR CONTRIBUTORY, ACTIVE OR PASSIVE, IMPUTED, JOINT OR
TECHNICAL).
(c) To the extent that the Borrower fails to pay any amount required to
be paid by the Borrower to the Global Administrative Agent or an Issuing Bank
under paragraph (a) or (b) of this Section, each Lender severally agrees to pay
to the Global Administrative Agent or such Issuing Bank, as the case may be,
such Lender's Applicable Percentage (determined as of the time that the
applicable unreimbursed expense or indemnity payment is sought) of such unpaid
amount; provided
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that the unreimbursed expense or indemnified loss, claim, damage, liability or
related expense, as the case may be, was incurred by or asserted against the
Global Administrative Agent or such Issuing Bank in its capacity as such.
(d) To the extent permitted by applicable law, the Borrower shall not
assert, and hereby waives, any claim against any Indemnitee, on any theory of
liability, for special, indirect, consequential or punitive damages (as opposed
to direct or actual damages) arising out of, in connection with, or as a result
of, this Agreement or any agreement or instrument contemplated hereby, the
Financing Transactions, any Loan or Letter of Credit or the use of the proceeds
thereof.
(e) All amounts due under this Section shall be payable not later than
thirty (30) days after written demand therefor.
SECTION 10.4. Successors and Assigns.
(a) The provisions of this Agreement shall be binding upon and inure to
the benefit of the parties hereto and their respective successors and assigns
permitted hereby (including any Affiliate of an Issuing Bank that issues any
Letter of Credit), except that the Borrower may not assign or otherwise transfer
any of its rights or obligations hereunder without the prior written consent of
the Global Administrative Agent, each Issuing Bank and each Combined Lender (and
any attempted assignment or transfer by the Borrower without such consent shall
be null and void). Nothing in this Agreement, expressed or implied, shall be
construed to confer upon any Person (other than the parties hereto, their
respective successors and assigns permitted hereby (including any Affiliate of
an Issuing Bank that issues any Letter of Credit) and, to the extent expressly
contemplated hereby, the Related Parties of each of the Global Administrative
Agent, the Issuing Banks and the Lenders) any legal or equitable right, remedy
or claim under or by reason of this Agreement.
(b) Any Lender may assign to one or more assignees all or a portion of
its rights and obligations under this Agreement (including all or a portion of
its Commitment and the Loans at the time owing to it); provided that (i) except
in the case of an assignment to a Lender or a Lender Affiliate, each of the
Borrower and the Global Administrative Agent (and, in the case of an assignment
of all or a portion of a Commitment or any Lender's obligations in respect of
its LC Exposure, the Issuing Banks) must give their prior written consent to
such assignment (which consents shall not be unreasonably withheld), (ii) except
in the case of an assignment to a Lender or a Lender Affiliate or an assignment
of the entire remaining amount of the assigning Lender's Commitment or Loans,
the amount of the Commitment or Loans of the assigning Lender subject to each
such assignment (determined as of the date the Assignment and Acceptance with
respect to such assignment is delivered to the Global Administrative Agent)
shall be in increments of U.S.$1,000,000 and not less than U.S.$10,000,000
unless each of the Borrower and the Global Administrative Agent otherwise
consent, (iii) each partial assignment shall be made as an assignment of a
proportionate part of all the assigning Lender's rights and obligations under
this Agreement, except that this clause (iii) shall not be construed to prohibit
the assignment of a proportionate part of all the assigning Lender's rights and
obligations in respect of its Commitments
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or Loans in conformity with the Intercreditor Agreement, (iv) the parties to
each assignment shall execute and deliver to the Global Administrative Agent an
Assignment and Acceptance, together with a processing and recordation fee of
U.S.$3,500, (v) the assignee, if it shall not be a Lender, shall deliver to the
Global Administrative Agent an Administrative Questionnaire, and (vi) after
giving effect to any assignment hereunder, the assigning Lender shall have a
Commitment of at least U.S.$10,000,000 unless each of the Borrower and the
Global Administrative Agent otherwise consents; and provided further that any
consent of the Borrower otherwise required under this paragraph shall not be
required if an Event of Default under Section 8.1 has occurred and is
continuing. Subject to acceptance and recording thereof pursuant to paragraph
(d) of this Section, from and after the effective date specified in each
Assignment and Acceptance, the assignee thereunder shall be a party hereto and
to the other Loan Documents and, to the extent of the interest assigned by such
Assignment and Acceptance, have the rights and obligations of a Lender under
this Agreement, and the assigning Lender thereunder shall, to the extent of the
interest assigned by such Assignment and Acceptance, be released from its
obligations under this Agreement and the other Loan Documents (and, in the case
of an Assignment and Acceptance covering all of the assigning Lender's rights
and obligations under this Agreement, such Lender shall cease to be a party
hereto but shall continue to be entitled to the benefits of Sections 2.15, 2.16,
2.17, 2.18, 2.20 and 10.3 and be subject to the terms of Section 10.12). Any
assignment or transfer by a Lender of rights or obligations under this Agreement
that does not comply with this paragraph shall be treated for purposes of this
Agreement as a sale by such Lender of a participation in such rights and
obligations in accordance with paragraph (e) of this Section.
(c) The Global Administrative Agent, acting for this purpose as an
agent of the Borrower, shall maintain at one of its offices in New York City a
copy of each Assignment and Acceptance delivered to it and a register for the
recordation of the names and addresses of the Lenders, and the Commitment of,
and principal amount of the Loans and LC Disbursements owing to, each Lender
pursuant to the terms hereof from time to time (the "Register"). The entries in
the Register shall be conclusive, and the Borrower, the Global Administrative
Agent, the Issuing Banks and the Lenders may treat each Person whose name is
recorded in the Register pursuant to the terms hereof as a Lender hereunder for
all purposes of this Agreement and the other Loan Documents, notwithstanding
notice to the contrary. The Register shall be available for inspection by the
Borrower, any Issuing Bank and any Lender, at any reasonable time and from time
to time upon reasonable prior notice.
(d) Upon its receipt of a duly completed Assignment and Acceptance
executed by an assigning Lender and an assignee, the assignee's completed
Administrative Questionnaire (unless the assignee shall already be a Lender
hereunder), the processing and recordation fee referred to in paragraph (b) of
this Section and any written consent to such assignment required by paragraph
(b) of this Section, the Global Administrative Agent shall accept such
Assignment and Acceptance and record the information contained therein in the
Register and will provide prompt written notice to the Borrower of the
effectiveness of such assignment. No assignment shall be effective for purposes
of this Agreement unless it has been recorded in the Register as provided in
this paragraph.
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(e) Any Lender may, without the consent of the Borrower, the Global
Administrative Agent or any Issuing Bank, sell participations to one or more
banks or other entities (a "Participant") in all or a portion of such Lender's
rights and obligations under this Agreement (including all or a portion of its
Commitment and the Loans owing to it); provided that (i) such Lender's
obligations under this Agreement shall remain unchanged, (ii) such Lender shall
remain solely responsible to the other parties hereto for the performance of
such obligations, and (iii) the Borrower, the Global Administrative Agent, the
Issuing Banks and the other Lenders shall continue to deal solely and directly
with such Lender in connection with such Lender's rights and obligations under
this Agreement. Any agreement or instrument pursuant to which a Lender sells
such a participation shall provide that such Lender shall retain the sole right
to enforce the Loan Documents and to approve any amendment, modification or
waiver of any provision of the Loan Documents; provided that such agreement or
instrument may provide that such Lender will not, without the consent of the
Participant, agree to any amendment, modification or waiver described in the
second proviso to Section 10.2(b) that affects such Participant. Subject to
paragraph (f) of this Section, the Borrower agrees that each Participant shall
be entitled to the benefits of Sections 2.15, 2.16 and 2.17 to the same extent
as if it were a Lender and had acquired its interest by assignment pursuant to
paragraph (b) of this Section. To the extent permitted by law, each Participant
also shall be entitled to the benefits of Section 10.8 and 10.12 as though it
were a Lender, provided such Participant agrees to be subject to Section 2.18(c)
as though it were a Lender.
(f) A Participant shall not be entitled to receive any greater payment
under Section 2.15, 2.16 or 2.17 than the applicable Lender would have been
entitled to receive with respect to the participation sold to such Participant.
A Participant that would be a Foreign Lender if it were a Lender shall not be
entitled to the benefits of Section 2.17 unless the Borrower is notified of the
participation sold to such Participant and such Participant agrees, for the
benefit of the Borrower, to comply with Section 2.17(e) as though it were a
Lender.
(g) Any Lender may at any time pledge or assign a Lien in all or any
portion of its rights under this Agreement to secure obligations of such Lender,
including any pledge or assignment to secure obligations to a Federal Reserve
Bank or, in the case of a Lender organized in a jurisdiction outside of the
United States, a comparable Person, and this Section shall not apply to any such
pledge or assignment of a security interest; provided that no such pledge or
assignment of a security interest shall release a Lender from any of its
obligations hereunder or substitute any such pledgee or assignee for such Lender
as a party hereto.
SECTION 10.5. Survival. All covenants, agreements, representations and
warranties made by the Loan Parties in the Loan Documents and in the
certificates or other instruments delivered in connection with or pursuant to
this Agreement or any other Loan Document shall be considered to have been
relied upon by the other parties hereto and shall survive the execution and
delivery of the Loan Documents and the making of any Loans and issuance of any
Letters of Credit, regardless of any investigation made by any such other party
or on its behalf and notwithstanding that any Agent, any Issuing Bank, the
Arranger or any Lender may have had notice or knowledge of any Default or
incorrect representation or warranty at the time any credit is extended
hereunder, and shall continue in full force and effect as long as the principal
of or any accrued interest on any
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Loan or any fee or any other amount payable under this Agreement is outstanding
and unpaid or any Letter of Credit is outstanding and so long as the Commitments
have not expired or terminated. The provisions of Sections 2.15, 2.16, 2.17,
2.18, 2.20, 10.3 and 10.12 and Article IX shall survive and remain in full force
and effect regardless of the consummation of the transactions contemplated
hereby, the repayment of the Loans, the expiration or termination of the Letters
of Credit and the Commitments or the termination of this Agreement or any
provision hereof.
SECTION 10.6. Counterparts; Effectiveness. This Agreement may be
executed in counterparts (and by different parties hereto on different
counterparts), each of which shall constitute an original, but all of which when
taken together shall constitute a single contract. Except as provided in Section
4.1, this Agreement shall become effective when it shall have been executed by
the Global Administrative Agent and when the Global Administrative Agent shall
have received counterparts hereof which, when taken together, bear the
signatures of each of the other parties hereto, and thereafter shall be binding
upon and inure to the benefit of the parties hereto and their respective
successors and assigns. Delivery of an executed counterpart of a signature page
of this Agreement by telecopy shall be effective as delivery of a manually
executed counterpart of this Agreement.
SECTION 10.7. Severability. Any provision of this Agreement held to be
invalid, illegal or unenforceable in any jurisdiction shall, as to such
jurisdiction, be ineffective to the extent of such invalidity, illegality or
unenforceability without affecting the validity, legality and enforceability of
the remaining provisions hereof; and the invalidity of a particular provision in
a particular jurisdiction shall not invalidate such provision in any other
jurisdiction.
SECTION 10.8. Right of Setoff. If an Event of Default shall have
occurred and be continuing, each of the Agents, the Issuing Banks, the Lenders
and their Affiliates is hereby authorized at any time and from time to time, to
the fullest extent permitted by law, to set off and apply any and all deposits
(general or special, time or demand, provisional or final) at any time held and
other obligations at any time owing by such Lender or Affiliate to or for the
credit or the account of the Borrower or any of its Subsidiaries (other than a
Foreign Subsidiary) against any and all the obligations of the Borrower now or
hereafter existing under this Agreement held by such Lender, irrespective of
whether or not such Lender shall have made any demand under this Agreement and
although such obligations may be unmatured; provided, however, that any such
set-off and application shall be subject to the provisions of Section 2.18. As
security for such obligations, the Borrower hereby grants to the Agents, each
Issuing Bank and each Lender a continuing security interest in any and all
balances, credits, deposits, accounts or moneys of the Borrower and its
Subsidiaries (other than a Foreign Subsidiary) then or thereafter maintained
with any of the Agents, such Issuing Bank and such Lenders. The rights of each
Lender under this Section are in addition to other rights and remedies
(including other rights of setoff) which such Lender may have.
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SECTION 10.9. GOVERNING LAW; JURISDICTION; CONSENT TO SERVICE OF
PROCESS.
(a) THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS (OTHER THAN THOSE
CONTAINING A CONTRARY EXPRESS CHOICE OF LAW PROVISION) SHALL BE CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.
(b) THE BORROWER HEREBY IRREVOCABLY AND UNCONDITIONALLY SUBMITS, FOR
ITSELF AND ITS PROPERTY, TO THE NONEXCLUSIVE JURISDICTION OF THE SUPREME COURT
OF THE STATE OF NEW YORK SITTING IN NEW YORK COUNTY AND OF THE UNITED STATES
DISTRICT COURT OF THE SOUTHERN DISTRICT OF NEW YORK, AND ANY APPELLATE COURT
FROM ANY THEREOF, IN ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS
AGREEMENT OR ANY LOAN DOCUMENT, OR FOR RECOGNITION OR ENFORCEMENT OF ANY
JUDGMENT, AND EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY AND UNCONDITIONALLY
AGREES THAT ALL CLAIMS IN RESPECT OF ANY SUCH ACTION OR PROCEEDING MAY BE HEARD
AND DETERMINED IN SUCH NEW YORK STATE OR, TO THE EXTENT PERMITTED BY LAW, IN
SUCH FEDERAL COURT. EACH OF THE PARTIES HERETO AGREES THAT, TO THE FULLEST
EXTENT PERMITTED BY APPLICABLE LAW, A FINAL JUDGMENT IN ANY SUCH ACTION OR
PROCEEDING SHALL BE CONCLUSIVE AND MAY BE ENFORCED IN OTHER JURISDICTIONS BY
SUIT ON THE JUDGMENT OR IN ANY OTHER MANNER PROVIDED BY LAW. NOTHING IN THIS
AGREEMENT SHALL AFFECT ANY RIGHT THAT THE AGENTS OR ANY LENDER MAY OTHERWISE
HAVE TO BRING ANY ACTION OR PROCEEDING RELATING TO THIS AGREEMENT AGAINST THE
BORROWER OR ITS PROPERTIES IN THE COURTS OF ANY JURISDICTION.
(c) THE BORROWER HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVES, TO THE
FULLEST EXTENT IT MAY LEGALLY AND EFFECTIVELY DO SO, ANY OBJECTION WHICH IT MAY
NOW OR HEREAFTER HAVE TO THE LAYING OF VENUE OF ANY SUIT, ACTION OR PROCEEDING
ARISING OUT OF OR RELATING TO THIS AGREEMENT IN ANY COURT REFERRED TO IN
PARAGRAPH (B) OF THIS SECTION. EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY
WAIVES, TO THE FULLEST EXTENT PERMITTED BY LAW, THE DEFENSE OF AN INCONVENIENT
FORUM TO THE MAINTENANCE OF SUCH ACTION OR PROCEEDING IN ANY SUCH COURT.
(d) EACH PARTY TO THIS AGREEMENT IRREVOCABLY CONSENTS TO SERVICE OF
PROCESS BY REGISTERED MAIL, POSTAGE PREPAID, OR BY PERSONAL SERVICE WITHIN OR
WITHOUT THE STATE OF NEW YORK. NOTHING IN THIS AGREEMENT WILL AFFECT THE RIGHT
OF ANY PARTY TO THIS AGREEMENT TO SERVE PROCESS IN ANY OTHER MANNER PERMITTED BY
LAW.
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SECTION 10.10. WAIVER OF JURY TRIAL. EACH PARTY HERETO HEREBY WAIVES,
TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A
TRIAL BY JURY IN ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF OR
RELATING TO THIS AGREEMENT, ANY OTHER LOAN DOCUMENT OR THE TRANSACTIONS
CONTEMPLATED HEREBY (WHETHER BASED ON CONTRACT, TORT OR ANY OTHER THEORY). EACH
PARTY HERETO (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY
OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD
NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND (B)
ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO ENTER
INTO THIS AGREEMENT BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND
CERTIFICATIONS IN THIS SECTION.
SECTION 10.11. Headings. Article and Section headings and the Table of
Contents used herein are for convenience of reference only, are not part of this
Agreement and shall not affect the construction of, or be taken into
consideration in interpreting, this Agreement.
SECTION 10.12. Confidentiality. In the event that the Borrower provides
to the Global Administrative Agent or the Lenders confidential information
belonging to the Borrower or any of its Subsidiaries, then the Global
Administrative Agent and the Lenders shall thereafter maintain such information
in confidence in accordance with the standards of care and diligence that each
utilizes in maintaining its own confidential information. This obligation of
confidence shall not apply to such portions of the information which (i) are in
the public domain, (ii) hereafter become part of the public domain without the
Global Administrative Agent or the Lenders breaching their obligation of
confidence to the Borrower, (iii) are previously known by the Global
Administrative Agent or the Lenders from some source other than the Borrower,
(iv) are hereafter developed by the Global Administrative Agent or the Lenders
without using the Borrower's information, (v) are hereafter obtained by or
available to the Global Administrative Agent or the Lenders from a third party
who owes no obligation of confidence to the Borrower with respect to such
information or through any other means other than through disclosure by the
Borrower, (vi) are disclosed with the Borrower's consent, (vii) must be
disclosed either pursuant to any Governmental Rule or to Persons regulating the
activities of the Global Administrative Agent or the Lenders, or (viii) as may
be required by law or regulation or order of any Governmental Authority in any
judicial, arbitration or governmental proceeding. Further, the Global
Administrative Agent or a Lender may disclose any such information to any other
Lender, any independent petroleum engineers or consultants, any independent
certified public or chartered accountants, any legal counsel employed by such
Person in connection with this Agreement or any other Combined Loan Document,
including without limitation, the enforcement or exercise of all rights and
remedies thereunder, or any assignee or participant (including prospective
assignees and participants) in the Loans; provided, however, that the Global
Administrative Agent or the Lenders shall receive a confidentiality agreement
from the Person to whom such information is disclosed such that said Person
shall have the same obligation to maintain the confidentiality of such
information as is imposed upon the Global Administrative Agent or the Lenders
hereunder. Notwithstanding anything to the contrary provided herein, this
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obligation of confidence shall cease three (3) years from the date the
information was furnished, unless the Borrower requests in writing at least
thirty (30) days prior to the expiration of such three year period, to maintain
the confidentiality of such information for an additional three year period. The
Borrower waives any and all other rights it may have to confidentiality as
against the Global Administrative Agent and the Lenders arising by contract,
agreement, statute or law except as expressly stated in this Section 10.12.
SECTION 10.13. Interest Rate Limitation. It is the intention of the
parties hereto to conform strictly to applicable interest, usury and criminal
laws and, anything herein to the contrary notwithstanding, the obligations of
the Borrower and the Guarantors to a Lender, any Issuing Bank or any Agent under
this Agreement or any Combined Loan Document 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, such
Issuing Bank or Agent limiting rates of interest which may be charged or
collected by such Lender, such Issuing Bank or Agent. Accordingly, if the
transactions contemplated hereby or thereby would be illegal, unenforceable,
usurious or criminal under laws applicable to a Lender, any Issuing Bank or any
Agent (including the laws of any jurisdiction whose laws may be mandatorily
applicable to such Lender or Agent notwithstanding anything to the contrary in
this Agreement or any other Combined Loan Document then, in that event,
notwithstanding anything to the contrary in this Agreement or any other Combined
Loan Document, it is agreed as follows:
(i) the provisions of this Section shall govern and control;
(ii) the aggregate of all consideration which constitutes
interest under applicable law that is contracted for, taken, reserved,
charged or received under this Agreement or any Combined Loan Document
or otherwise in connection with this Agreement or any Combined Loan
Document by such Lender, such Issuing Bank or such 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, each Issuing Bank and the Agents herein called the
"Highest Lawful Rate"), and any excess shall be cancelled automatically
and if theretofore paid shall be credited to the Borrower by such
Lender, such Issuing Bank or such Agent (or, if such consideration
shall have been paid in full, such excess refunded to the Borrower);
(iii) all sums paid, or agreed to be paid, to such Lender,
such Issuing Bank or such Agent for the use, forbearance and detention
of the indebtedness of the Borrower to such Lender, such Issuing Bank
or such Agent hereunder or under any Combined Loan Document shall, to
the extent permitted by laws applicable to such Lender, such Issuing
Bank or such Agent, as the case may be, be amortized, prorated,
allocated and spread throughout the full term of such indebtedness
until payment in full so that the actual rate of interest is uniform
throughout the full term thereof;
(iv) if at any time the interest provided pursuant to this
Section or any other clause of this Agreement or any other Combined
Loan Document, together with any other fees or
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compensation payable pursuant to this Agreement or any other Combined
Loan Document and deemed interest under laws applicable to such Lender,
such Issuing Bank or such Agent, exceeds that amount which would have
accrued at the Highest Lawful Rate, the amount of interest and any such
fees or compensation to accrue to such Lender, such Issuing Bank or
such Agent pursuant to this Agreement or such other Combined Loan
Document shall be limited, notwithstanding anything to the contrary in
this Agreement or any other Combined Loan Document, to that amount
which would have accrued at the Highest Lawful Rate, but any subsequent
reductions, as applicable, shall not reduce the interest to accrue to
such Lender, such Issuing Bank or such Agent pursuant to this Agreement
or such other Combined Loan Document below the Highest Lawful Rate
until the total amount of interest accrued pursuant to this Agreement
or such other Combined Loan Document, as the case may be, and such fees
or compensation deemed to be interest equals the amount of interest
which would have accrued to such Lender or Agent if a varying rate per
annum equal to the interest provided pursuant to any other relevant
Section hereof (other than this Section) or thereof, 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
(v) with the intent that the rate of interest herein shall at
all times be lawful, and if the receipt of any funds owing hereunder or
under any other agreement related hereto (including any of the other
Combined Loan Documents) by such Lender, such Issuing Bank or such
Agent would cause such Lender to charge the Borrower a criminal rate of
interest, the Lenders, the Issuing Banks and the Agents agree that they
will not require the payment or receipt thereof or a portion thereof
which would cause a criminal rate of interest to be charged by such
Lender, such Issuing Bank or such Agent, as applicable, and if received
such affected Lender, such Issuing Bank or Agent will return such funds
to the Borrower so that the rate of interest paid by the Borrower shall
not exceed a criminal rate of interest from the date this Agreement was
entered into.
SECTION 10.14. Collateral Matters; Hedging Agreements; Overdraft
Facility. The benefit of the Security Documents and of the provisions of this
Agreement relating to the Collateral shall also extend to and be available to
(i) those Lenders or their Affiliates which are counterparties to the Hedging
Agreements on a pro rata basis in respect of any Hedging Obligations of the
Borrower or any of its Subsidiaries that is in effect at such time as such
Person (or its Affiliate) is a Lender, but only while such Person or its
Affiliate is a Lender, and (ii) those Lenders which are parties to the Overdraft
Facility on a pro rata basis in respect of any obligations of the Borrower or
any of its Subsidiaries under such Overdraft Facility up to a maximum of
$5,000,000 that are in effect at such time as such Person is a Lender, but only
while such Person is a Lender.
SECTION 10.15. Arranger; U.S. Documentation Agent; U.S. Syndication
Agent; Other Agents. None of the Persons identified on the facing page or the
signature pages of this Agreement as the "Sole Bookrunner and Lead Arranger" or
"U.S. Documentation Agent" or "U.S. Syndication Agent" or any other Agent (other
than the Global Administrative Agent) shall have any right, power, obligation,
liability, responsibility or duty under this Agreement or any other Combined
Loan Document other than, except in the case of the Arranger, those applicable
to all Lenders as such.
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Without limiting the foregoing, none of the Arranger, the U.S. Documentation
Agent, the U.S. Syndication Agent or any other Agent (other than the Global
Administrative Agent) shall have or be deemed to have any fiduciary relationship
with any Lender or the Borrower or any of its Subsidiaries. The Borrower and
each Lender acknowledges that it has not relied, and will not rely, on any of
the Arranger, the U.S. Documentation Agent, U.S. Syndication Agent or any other
Agent (other than the Global Administrative Agent) in deciding to enter into
this Agreement or in taking or not taking any action hereunder or under the
Combined Loan Documents.
SECTION 10.16. Intercreditor Agreement; Security Documents. For so long
as the Intercreditor Agreement shall be in effect, the terms and conditions of
this Agreement and the other Loan Documents are subject to the terms of the
Intercreditor Agreement. In the event of any inconsistency between this
Agreement or any other Loan Document and the terms of the Intercreditor
Agreement, the Intercreditor Agreement shall control. In the event of any
inconsistency between this Agreement and the terms of any other Loan Document,
this Agreement shall control.
SECTION 10.17. NO ORAL AGREEMENTS. THIS WRITTEN AGREEMENT AND THE OTHER
LOAN DOCUMENTS REPRESENT THE FINAL AGREEMENT BETWEEN THE PARTIES WITH RESPECT TO
THE SUBJECT MATTER HEREOF AND THEREOF AND MAY NOT BE CONTRADICTED BY EVIDENCE OF
PRIOR, CONTEMPORANEOUS, OR SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES. THERE ARE
NO UNWRITTEN ORAL AGREEMENTS AMONG THE PARTIES.
[SIGNATURES BEGIN ON FOLLOWING PAGE]
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed by their respective authorized officers as of the day and year
first above written.
▇▇▇ ▇▇▇▇▇, INC., as Borrower
By:
-------------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Title: Executive Vice President, Treasurer
and Chief Financial Officer
[SIGNATURE PAGE TO U.S. REVOLVING CREDIT AGREEMENT]
S - 1
101
THE CHASE MANHATTAN BANK, as
Global Administrative Agent and as a Lender
By:
----------------------------------------
Name:
Title:
[SIGNATURE PAGE TO U.S. REVOLVING CREDIT AGREEMENT]
S - 2
102
BNP PARIBAS, as U.S. Documentation
Agent and as a Lender
By:
--------------------------------------
Name:
Title:
By:
--------------------------------------
Name:
Title:
[SIGNATURE PAGE TO U.S. REVOLVING CREDIT AGREEMENT]
S - 3
103
U.S. BANK NATIONAL ASSOCIATION,
as U.S. Syndication Agent and as a Lender
By:
--------------------------------------
Name:
Title:
[SIGNATURE PAGE TO U.S. REVOLVING CREDIT AGREEMENT]
S - 4
▇▇▇
▇▇▇ ▇▇▇▇ ▇▇ ▇▇▇▇ ▇▇▇▇▇▇, as a
Lender
By:
--------------------------------------
Name:
Title:
[SIGNATURE PAGE TO U.S. REVOLVING CREDIT AGREEMENT]
S - 5
105
TORONTO DOMINION (TEXAS), INC.,
as a Lender
By:
--------------------------------------
Name:
Title:
[SIGNATURE PAGE TO U.S. REVOLVING CREDIT AGREEMENT]
S - 6
106
CHRISTIANIA BANK OG
KREDITKASSE, ASA NEW YORK
BRANCH, as Managing Agent and as a
Lender
By:
--------------------------------------
Name:
Title:
[SIGNATURE PAGE TO U.S. REVOLVING CREDIT AGREEMENT]
S - 7
107
COMERICA BANK - TEXAS, as Co-Agent
and as a Lender
By:
--------------------------------------
Name:
Title:
[SIGNATURE PAGE TO U.S. REVOLVING CREDIT AGREEMENT]
S - 8
108
THE FUJI BANK, LIMITED, as a Lender
By:
--------------------------------------
Name:
Title:
[SIGNATURE PAGE TO U.S. REVOLVING CREDIT AGREEMENT]
S - 9
109
▇▇▇▇▇ FARGO BANK, N.A., as a Lender
By:
--------------------------------------
Name:
Title:
[SIGNATURE PAGE TO U.S. REVOLVING CREDIT AGREEMENT]
S - 10
110
EXHIBIT A
FORM OF LEGAL OPINION OF ▇▇▇▇▇▇ & ▇▇▇▇▇▇ L.L.P.
[to be attached]
Exhibit A - Page 1
111
EXHIBIT B
FORM OF LENDER CERTIFICATE
, 200
-------- ---
To: THE CHASE MANHATTAN BANK,
as Global Administrative Agent
The Borrower, the Global Administrative Agent, the other Agents and
certain Lenders have heretofore entered into a Credit Agreement, dated as of
March 20, 2001 as amended from time to time (the "Credit Agreement").
Capitalized terms herein used having the meaning specified in the Credit
Agreement.
[Language for Existing Lender]
[ Please be advised that the undersigned has agreed to increase its
Commitment under the Credit Agreement effective __________, 200__ from
U.S.$________________ to U.S.$____________ and (b) that it shall continue to be
a party in all respect to the Credit Agreement and the other Loan Documents.]
[Language for New Lender]
[ Please be advised that the undersigned has agreed (a) to become a
Lender under the Credit Agreement effective __________, 200__ with a Commitment
of U.S.$____________ and (b) that it shall be deemed to be a party in all
respect to the Credit Agreement and the other Loan Documents.]
Very truly yours,
By:
--------------------------------------
Name:
Title:
Exhibit B - Page 1
112
Accepted and Agreed:
THE CHASE MANHATTAN BANK.,
as Global Administrative Agent
By:
-------------------------------------
Name:
Title:
Accepted and Agreed:
▇▇▇ ▇▇▇▇▇, INC.
By:
-------------------------------------
Name:
Title:
Exhibit B - Page 2
113
EXHIBIT C
FORM OF COMPLIANCE CERTIFICATE
The undersigned hereby certifies that he is the ________________ of ▇▇▇
▇▇▇▇▇, Inc., a Delaware corporation ("Borrower"), and that as such he is
authorized to execute this certificate on behalf of the Borrower. With reference
to the Credit Agreement dated as of March 20, 2001 among the Borrower, The Chase
Manhattan Bank, as Global Administrative Agent, U.S. Bank National Association,
as U.S. Syndication Agent, BNP Paribas, as U.S. Documentation Agent, the other
Agents party thereto, and such Lenders which are or become a party thereto
(together with all amendments or supplements thereto being the "Credit
Agreement"), the undersigned represents and warrants as follows (each
capitalized term used herein having the same meaning given to it in the Credit
Agreement unless otherwise specified):
(a) The representations and warranties of the Borrower contained in
Article VIII of the Credit Agreement and of the Borrower and its Subsidiaries in
any other Combined Loan Document and otherwise made in writing by or on behalf
of the Borrower pursuant to the Credit Agreement and the Borrower or any
Subsidiary pursuant to the other Combined Loan Documents were true and correct
when made, and are repeated at and as of the time of delivery hereof and are
true and correct at and as of the time of delivery hereof, except as such
representations and warranties are modified to give effect to the transactions
expressly permitted by the Credit Agreement or are limited to an earlier date.
(b) The Borrower and each Subsidiary has performed and complied with
all agreements and conditions contained in the Combined Loan Documents to which
it is a party required to be performed or complied with by it prior to or at the
time of delivery hereof.
(c) Neither the Borrower nor any Subsidiary has incurred any material
liabilities, direct or contingent, since December 31, 1999 except those set
forth in Schedule 7.1 to the Credit Agreement and except those allowed by the
terms of the Combined Credit Agreements or consented to by the Lenders in
writing.
(d) Since December 31, 1999, no change has occurred, either in any case
or in the aggregate, in the condition, financial or otherwise, of the Borrower
or any Subsidiary which could reasonably be expected to have a Material Adverse
Effect.
(e) There exists, and, after giving effect to the Loan or Loans with
respect to which this certificate is being delivered, will exist, no Default
under the Combined Credit Agreements or any event or circumstance which
constitutes, or with notice or lapse of time (or both) would constitute, an
event of default under any loan or credit agreement, indenture, deed of trust,
security agreement or other agreement or instrument evidencing or pertaining to
any Indebtedness of the Borrower or any Subsidiary, including, without
limitation, the Combined Loan Documents, or under any material
Exhibit C - Page 1
114
agreement or instrument to which the Borrower or any Subsidiary is a party or by
which the Borrower or any Subsidiary is bound.
(f) The financial statements furnished to the Global Administrative
Agent with this certificate fairly present, in all material respects, the
consolidated financial condition and results of operations of the Borrower and
its Consolidated Subsidiaries as at the end of, and for, the [fiscal quarter]
[fiscal year] ending _________________________ and such financial statements
have been approved in accordance with the accounting procedures specified in the
Credit Agreement.
(g) Attached hereto are the detailed computations necessary to
determine whether the Borrower and its Consolidated Subsidiaries are in
compliance with Sections 6.1 and 6.2 of the Credit Agreement as of the end of
the [fiscal quarter] [fiscal year] ending __________________.
EXECUTED AND DELIVERED this ____ day of ______________, 200__.
▇▇▇ ▇▇▇▇▇, INC.
By:
--------------------------------------
Name:
Title:
Exhibit C - Page 2
115
EXHIBIT D
FORM OF ASSIGNMENT AND ACCEPTANCE
Reference is made to that certain Credit Agreement, dated as of March
20, 2001 (together with all amendments, if any, from time to time made thereto,
the "Credit Agreement"), among ▇▇▇ ▇▇▇▇▇, Inc., a Delaware corporation (the
"Borrower"), The Chase Manhattan Bank, as Global Administrative Agent (the
"Global Administrative Agent"), U.S. Bank National Association, as the U.S.
Syndication Agent, BNP Paribas, as the U.S. Documentation Agent, the other
Agents party thereto, and such Lenders which are or become a party thereto.
Terms defined in the Credit Agreement are used herein with the same meanings.
The Assignor named on the reverse hereof hereby sells and assigns,
without recourse, to the Assignee named on the reverse hereof, and the Assignee
hereby purchases and assumes, without recourse, from the Assignor, effective as
of the Assignment Date set forth on the reverse hereof, the interests set forth
on the reverse hereof (the "Assigned Interest") in the Assignor's rights and
obligations under the Credit Agreement and the other Loan Documents, including,
without limitation, the interests set forth on the reverse hereof in the
Commitment of the Assignor on the Assignment Date and Loans owing to the
Assignor which are outstanding on the Assignment Date, but excluding accrued
interest and fees to and excluding the Assignment Date. The Assignee hereby
acknowledges receipt of a copy of the Credit Agreement and the other Loan
Documents. From and after the Assignment Date (i) the Assignee shall be a party
to and be bound by the provisions of the Credit Agreement and the other Loan
Documents, including, without limitation, the Intercreditor Agreement, and, to
the extent of the Assigned Interest, have the rights and obligations of a Lender
thereunder and (ii) the Assignor shall, to the extent of the Assigned Interest,
relinquish its rights and be released from its obligations under the Credit
Agreement and the other Loan Documents (other than those set forth in Sections
10.4 and 10.12 thereof).
This Assignment and Acceptance is being delivered to the Global
Administrative Agent together with (i) if the Assignee is a Foreign Lender, any
documentation required to be delivered by the Assignee pursuant to Section
2.17(e) of the Credit Agreement, duly completed and executed by the Assignee,
and (ii) if the Assignee is not already a Lender under the Credit Agreement, an
Administrative Questionnaire in the form supplied by the Global Administrative
Agent, duly completed by the Assignee. The [Assignee/Assignor] shall pay the fee
payable to the Global Administrative Agent pursuant to Section 10.4(b) of the
Credit Agreement.
THIS ASSIGNMENT AND ACCEPTANCE SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.
Date of Assignment:
------------------------------------------------------------
Legal Name of Assignor:
--------------------------------------------------------
Legal Name of Assignee:
--------------------------------------------------------
Exhibit D - Page 1
116
Assignee's Address for Notices:
------------------------------------------------
Effective Date of Assignment ("Assignment Date"):
------------------------------
Percentage Assigned of
Facility/Commitment (set forth, to
at least 8 decimals, as a percentage
of the Facility and the aggregate
Principal Amount Commitments of all Lenders
Facility Assigned thereunder)
-------- ---------------- ------------------------------------
Commitment Assigned: U.S.$ %
--------- -------------
Loans: U.S.$ %
--------- -------------
Credit Exposure: U.S.$ %
--------- -------------
The terms set forth above and on the reverse side hereof are hereby agreed to:
[Name of Assignor] , as Assignor
By:
--------------------------------------
Name:
Title:
[Name of Assignee] , as Assignee
By:
--------------------------------------
Name:
Title:
Exhibit D - Page 2
117
The undersigned hereby consent to the within assignment:(1)
▇▇▇ ▇▇▇▇▇, INC.
By:
--------------------------------------
Name:
Title:
THE CHASE MANHATTAN BANK, as Global
Administrative Agent
By:
--------------------------------------
Name:
Title:
----------
(1) Consents to be included to the extent required by Section 10.4(b) of
the Credit Agreement.
Exhibit D - Page 3
118
EXHIBIT E-1
FORM OF BORROWING REQUEST
, 200
--------- ---
The Chase Manhattan Bank
as Global Administrative Agent
for the Lenders referred to below
c/o The Chase Manhattan Bank
Global Oil & Gas Group
▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇▇▇
Facsimile: ▇▇▇-▇▇▇-▇▇▇▇
The Chase Manhattan Bank
as Global Administrative Agent
for the Lenders referred to below
▇/▇ ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ Bank
Loan and Agency Services
One Chase ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Facsimile: ▇▇▇-▇▇▇-▇▇▇▇
Re: ▇▇▇ ▇▇▇▇▇, Inc. - U.S. Revolving Credit Agreement
Dear Sirs:
Reference is made to that certain Credit Agreement, dated as of March
20, 2001 (together with all amendments, if any, from time to time made thereto,
the "Credit Agreement"), among ▇▇▇ ▇▇▇▇▇, Inc, a Delaware corporation (the
"Borrower"), The Chase Manhattan Bank, as Global Administrative Agent (the
"Global Administrative Agent"), U.S. Bank National Association, as the U.S.
Syndication Agent, BNP Paribas, as the U.S. Documentation Agent, the other
Agents party thereto, and such Lenders which are or become a party thereto.
Terms defined in the Credit Agreement are used herein with the same meanings.
This notice constitutes a Borrowing Request and the Borrower hereby requests a
Borrowing under the Credit Agreement, and in that connection the Borrower
specifies the following information with respect to the Borrowing requested
hereby:
Exhibit E-1 - Page 1
119
(A) Principal amount of Borrowing(1):
----------------------------------
(B) Interest rate basis(2):
--------------------------------------------
(C) Effective date (which is a Business Day):
--------------------------
(D) Date of maturity (which is a Business Day):
------------------------
(E) Interest Period(3):
------------------------------------------------
If the Borrowing results in an increase in the aggregate outstanding
principal amount of the Loans, the Borrower hereby represents and warrants that
the conditions specified in paragraphs (a), (b) and (c) of Section 4.2 of the
Credit Agreement are satisfied.
The Borrower has caused this Borrowing Request to be executed and
delivered by its Authorized Officer this ___________ day of ___________________,
200___.
Very truly yours,
▇▇▇ ▇▇▇▇▇, INC.
By:
-------------------------------------
Name:
Title:
----------
(1) Not less than (i) U.S.$1,000,000 and an integral multiple of
U.S.$1,000,000 with respect to Eurodollar Loans (ii) U.S.$500,000 and
an integral multiple of U.S.$500,000 with respect to an ABR Borrowing
(or the aggregate unused balance of the Commitments in the case of an
ABR Borrowing).
(2) Eurodollar Borrowing or ABR Borrowing.
(3) If applicable, selected period must comply with the definition of
"Interest Period" and end not later than the Maturity Date.
Exhibit E-1 - Page 2
120
EXHIBIT E-2
FORM OF INTEREST ELECTION REQUEST
, 200
---------------- ---
The Chase Manhattan Bank
as Global Administrative Agent
for the Lenders referred to below
c/o The Chase Manhattan Bank
Global Oil & Gas Group
▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇▇▇
Facsimile: ▇▇▇-▇▇▇-▇▇▇▇
The Chase Manhattan Bank
as Global Administrative Agent
for the Lenders referred to below
▇/▇ ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ Bank
Loan and Agency Services
One Chase ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Facsimile: ▇▇▇-▇▇▇-▇▇▇▇
Re: ▇▇▇ ▇▇▇▇▇, Inc. - U.S. Revolving Credit Agreement
Dear Sirs:
Reference is made to that certain Credit Agreement, dated as of March
20, 2001 (together with all amendments, if any, from time to time made thereto,
the "Credit Agreement"), among ▇▇▇ ▇▇▇▇▇, Inc., a Delaware corporation (the
"Borrower"), The Chase Manhattan Bank, as Global Administrative Agent (the
"Global Administrative Agent"), U.S. Bank National Association, as the U.S.
Syndication Agent, BNP Paribas, as the U.S. Documentation Agent, the other
Agents party thereto, and such Lenders which are or become a party thereto.
Terms defined in the Credit Agreement are used herein with the same meanings.
This notice constitutes an Interest Election Request and the Borrower hereby
requests the conversion or continuation of a Borrowing under the Credit
Agreement, and in that connection the Borrower specifies the following
information with respect to the Borrowing to be converted or continued as
requested hereby:
Exhibit E-2 - Page 1
121
(A) Borrowing to which this request applies(1):
------------------------
(B) Principal amount of Borrowing to be converted/continued(2):
--------
(C) Effective date of election (which is a Business Day):
--------------
(D) Interest rate basis of resulting Borrowing(3):
---------------------
(E) Interest Period of resulting Borrowing(4):
-------------------------
Very truly yours,
▇▇▇ ▇▇▇▇▇, INC.
By:
--------------------------------------
Name:
Title:
----------
(1) Specify existing Type and last day of current Interest Period.
(2) Not less than (i) U.S.$1,000,000 and an integral multiple of
U.S.$1,000,000 with respect to Eurodollar Loans (ii) U.S.$500,000 and
an integral multiple of U.S.$500,000 with respect to an ABR Borrowing
(or the aggregate unused balance of the Commitments in the case of an
ABR Borrowing).
(3) Eurodollar Borrowing or ABR Borrowing.
(4) Which must comply with the definition of "Interest Period" and end not
later than the Maturity Date.
Exhibit E-2 - Page 2
122
EXHIBIT F
FORM OF PLEDGE AGREEMENT
[to be attached]
Exhibit F - Page 1
123
EXHIBIT G
FORM OF GUARANTY
[to be attached]
Exhibit G - Page 1
124
EXHIBIT H
SUBSIDIARY GUARANTORS
Retex, Inc., a Wyoming corporation
TBI West Virginia, Inc., a Delaware corporation
▇▇▇▇▇ Drilling Company, a Delaware corporation
TBI Field Services, Inc., a Delaware corporation
Exhibit H - Page 1
125
SCHEDULE 2.1
COMMITMENTS
Lender Commitments
------ -----------
The Chase Manhattan Bank U.S.$ 1,888,888.90
U.S. Bank National Association U.S.$14,444,444.44
BNP Paribas U.S.$ 6,444,444.44
The Bank of Nova Scotia U.S.$ 4,444,444.44
Toronto Dominion (Texas), Inc. U.S.$ 4,444,444.44
Christiania Bank OG Kreditkasse, ASA New York Branch U.S.$14,444,444.44
Comerica Bank - Texas U.S.$11,555,555.56
The Fuji Bank, Limited U.S.$ 8,666,666.67
▇▇▇▇▇ Fargo Bank, ▇.▇. ▇.▇.$ 8,666,666.67
TOTAL: U.S.$75,000,000
Schedule 2.1 - Page 1
126
SCHEDULE 3.2
LIABILITIES
NONE
Schedule 3.2 - Page 1
127
SCHEDULE 3.9
TAXES
NONE
Schedule 3.9 - Page 1
128
SCHEDULE 3.10
PROPERTIES
NONE
Schedule 3.10 - Page 1
129
SCHEDULE 3.14
SUBSIDIARIES AND PARTNERSHIPS
Principal place of business and chief executive office of each Subsidiary:
Wholly owned Subsidiaries of ▇▇▇ ▇▇▇▇▇, Inc.:
Retex Inc.
▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Rocno Corporation
▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
▇▇▇▇▇ Drilling Company
▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
TBI Field Services, Inc.
▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
▇▇▇ ▇▇▇▇▇ Resources Funding Corp.
▇▇▇ ▇▇▇ ▇▇▇▇▇▇ ▇▇, ▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇ ▇▇▇
TBI Pipeline Company
▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
TBI West Virginia, Inc.
▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
TCP Gathering Co.
▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
▇▇▇ ▇▇▇▇▇ Resources Ltd.
▇▇▇ ▇▇▇ ▇▇▇▇▇▇ ▇▇, ▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇ ▇▇▇
Schedule 3.14 - Page 1
130
Subsidiary of ▇▇▇ ▇▇▇▇▇ Resources Ltd.:
Stellarton Energy International Corporation (Barbados) 100% owned
▇▇▇ ▇▇▇ ▇▇▇▇▇▇ ▇▇, ▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇ ▇▇▇
Subsidiary of Stellarton Energy International Corporation (Barbados)
Stellarton de Venezuela C.A. (Venezuela) 100% owned
▇▇▇ ▇▇▇ ▇▇▇▇▇▇ ▇▇, ▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇ ▇▇▇
Schedule 3.14 - Page 2
131
SCHEDULE 3.19
INSURANCE
[to be attached]
Schedule 3.19 - Page 1
132
SCHEDULE 3.20
HEDGING AGREEMENTS
I. 2001 U.S. volumes hedged by quarter:
Period Volume NYMEX NYMEX NYMEX
(Quarter) (MMBtu/d) Floor Ceiling Basis Swap
--------- --------- ----- ------- ----------
First 70,000 $6.60 $9.06 ($0.05)
Second 63,000 $4.32 $7.05 ($0.28)
Third 60,000 $4.03 $6.73 ($0.28)
Fourth 40,000 $4.14 $6.76 ($0.27)
------ ----- ----- ------
Year average 58,000 $4.89 $7.51 ($0.21)
For the first quarter 2001, ▇▇▇ ▇▇▇▇▇ realized a gain of $1,713,460
from the NYMEX collars and $1,359,980 from the NYMEX Basis swap. ▇▇▇ ▇▇▇▇▇ has
no other ▇▇▇▇▇▇ beyond December 31, 2001 in the U.S.
The net ▇▇▇▇ to market value for the NYMEX collars and the NYMEX Basis
swap for second through fourth quarters 2001 totals ($714,046) (loss) and
$899,220 gain, respectively, as of March 1, 2001.
II. Canadian volumes hedged:
2001 Volume Delivered
(Quarter) (Mcf/d) Price C$
--------- ------- ---------
First 11,800 $5.45
Second 7,200 $3.83
Third 7,200 $3.83
Fourth 5,900 $3.36
----- -----
2001 average 8,000 $4.33
2002 average 5,125 $2.89
2003 average 1,470 $2.73
2004 average 1,370 $3.25
The net ▇▇▇▇ value of the physical ▇▇▇▇▇▇ as of March 1, 2001 was
(C$28,433,767) (loss). The Canadian ▇▇▇▇▇▇ are considered effective ▇▇▇▇▇▇ and
will not have to be marked to market for accounting purposes.
Schedule 3.20 - Page 1
133
SCHEDULE 3.22
MATERIAL AGREEMENTS
NONE
Schedule 3.22 - Page 1
134
SCHEDULE 7.1
INDEBTEDNESS
NONE
Schedule 7.1 - Page 1
135
SCHEDULE 7.2
LIENS
NONE
Schedule 7.2 - Page 1