================================================================================
U.S. $95,000,000
FOURTH AMENDED AND RESTATED CREDIT AGREEMENT
dated as of October 12, 2001,
among
MARKWEST HYDROCARBON, INC.,
as the Borrower,
and
CERTAIN FINANCIAL INSTITUTIONS,
as the Lenders,
and
BANK OF AMERICA, N.A.,
as the Administrative Agent for the Lenders
--------------------
BANC OF AMERICA SECURITIES LLC,
as Lead Arranger and Sole Book Manager
================================================================================
TABLE OF CONTENTS
Page
ARTICLE I DEFINITIONS AND ACCOUNTING TERMS......................................................2
SECTION 1.1 Defined Terms.........................................................................2
SECTION 1.2 Use of Defined Terms.................................................................23
SECTION 1.3 Cross-References.....................................................................24
SECTION 1.4 Accounting and Financial Determinations..............................................24
ARTICLE II COMMITMENTS, BORROWING PROCEDURES AND NOTES..........................................24
SECTION 2.1 Commitments..........................................................................24
SECTION 2.1.1 Revolving Loan Commitment............................................................24
SECTION 2.1.2 Commitment to Issue Letters of Credit................................................25
SECTION 2.1.3 [Intentionally Left Blank]...........................................................25
SECTION 2.1.4 Term Loan Commitment.................................................................25
SECTION 2.1.5 Lenders Not Required To Make Loans or Issue or Participate in Letters of Credit......25
SECTION 2.1.6 Increase in Revolving Loan Commitment Amount.........................................25
SECTION 2.2 Reduction of Commitment Amounts......................................................27
SECTION 2.2.1 Optional Reductions..................................................................27
SECTION 2.2.2 Mandatory Reductions.................................................................27
SECTION 2.3 Borrowing Procedure..................................................................27
SECTION 2.4 Continuation and Conversion Elections................................................28
SECTION 2.5 Notes................................................................................28
SECTION 2.6 Letters of Credit....................................................................29
SECTION 2.6.1 Issuance Requests....................................................................29
SECTION 2.6.2 Issuances and Extensions.............................................................29
SECTION 2.6.3 [Intentionally Left Blank]...........................................................29
SECTION 2.6.4 Other Lenders' Participation.........................................................30
SECTION 2.6.5 Disbursements........................................................................30
SECTION 2.6.6 Reimbursement........................................................................31
SECTION 2.6.7 Deemed Disbursements.................................................................31
SECTION 2.6.8 Nature of Reimbursement Obligations..................................................32
SECTION 2.6.9 Increased Costs; Indemnity...........................................................33
ARTICLE III REPAYMENTS, PREPAYMENTS, INTEREST AND FEES...........................................34
SECTION 3.1 Repayments and Prepayments...........................................................34
SECTION 3.1.1 Optional Prepayment..................................................................35
SECTION 3.1.2 Mandatory Prepayment.................................................................36
SECTION 3.1.3 Mandatory Prepayment on Acceleration.................................................36
SECTION 3.1.4 Prepayments of Term Loans............................................................36
SECTION 3.2 Interest Provisions..................................................................36
SECTION 3.2.1 Rates................................................................................36
i
SECTION 3.2.2 Default Rate.........................................................................36
SECTION 3.2.3 Payment Dates........................................................................37
SECTION 3.3 Fees.................................................................................37
SECTION 3.3.1 Commitment Fee.......................................................................37
SECTION 3.3.2 Administrative Agent's Fee...........................................................37
SECTION 3.3.3 Letter of Credit Fees................................................................37
ARTICLE IV CERTAIN LIBO RATE AND OTHER PROVISIONS...............................................38
SECTION 4.1 Fixed Rate Lending Unlawful..........................................................38
SECTION 4.2 Deposits Unavailable.................................................................38
SECTION 4.3 Increased LIBO Rate Loan Costs, etc..................................................38
SECTION 4.4 Funding Losses.......................................................................39
SECTION 4.5 Increased Capital Costs..............................................................39
SECTION 4.6 Taxes................................................................................39
SECTION 4.7 Payments, Computations, etc..........................................................40
SECTION 4.8 Sharing of Payments..................................................................41
SECTION 4.9 Setoff...............................................................................41
ARTICLE V CONDITIONS TO BORROWING..............................................................42
SECTION 5.1 Continuation of Existing Loans; Initial Borrowing....................................42
SECTION 5.1.1 Resolutions, etc.....................................................................42
SECTION 5.1.2 Delivery of this Agreement...........................................................42
SECTION 5.1.3 Guaranty Agreements..................................................................42
SECTION 5.1.4 Collateral Documents.................................................................42
SECTION 5.1.6 Repayment of Loans under.............................................................43
SECTION 5.1.7 Closing of the Canadian Facility.....................................................43
SECTION 5.1.8 Closing Certificate..................................................................43
SECTION 5.1.9 Opinions of Counsel..................................................................43
SECTION 5.1.10 Closing Fees, Expenses, etc..........................................................43
SECTION 5.1.11 Evidence of Insurance................................................................43
SECTION 5.1.12 [Intentionally Left Blank]...........................................................44
SECTION 5.1.13 Title................................................................................44
SECTION 5.1.14 Initial Reserve Report...............................................................44
SECTION 5.1.15 Environmental Reports................................................................44
SECTION 5.1.16 Financial Statements.................................................................44
SECTION 5.1.17 Incentive Payments Agreement.........................................................45
SECTION 5.1.18 Other................................................................................45
SECTION 5.2 All Borrowings.......................................................................45
SECTION 5.2.1 Compliance with Warranties, No Default, etc..........................................45
SECTION 5.2.2 Borrowing Request; Compliance Certificate............................................45
SECTION 5.2.3 Satisfactory Legal Form..............................................................46
ARTICLE VI REPRESENTATIONS AND WARRANTIES.......................................................46
SECTION 6.1 Organization, etc....................................................................46
SECTION 6.2 Due Authorization, Non-Contravention, etc............................................46
ii
SECTION 6.3 Government Approval, Regulation, etc.................................................47
SECTION 6.4 Validity, etc........................................................................47
SECTION 6.5 Financial Information; Projections...................................................47
SECTION 6.6 No Material Adverse Change...........................................................48
SECTION 6.7 Litigation, Labor Controversies, etc.................................................48
SECTION 6.8 Subsidiaries.........................................................................48
SECTION 6.9 Ownership of Properties..............................................................48
SECTION 6.10 Taxes................................................................................48
SECTION 6.11 Pension and Welfare Plans............................................................48
SECTION 6.12 Compliance with Law..................................................................48
SECTION 6.13 Claims and Liabilities...............................................................49
SECTION 6.14 No Prohibition on Perfection of Collateral Documents.................................49
SECTION 6.15 Solvency.............................................................................49
SECTION 6.16 Environmental Warranties.............................................................50
SECTION 6.17 Regulations T, U and X...............................................................51
SECTION 6.18 Accuracy of Information..............................................................52
SECTION 6.19 Default..............................................................................52
SECTION 6.20 [Intentionally Left Blank]...........................................................52
SECTION 6.21 ▇▇▇▇▇▇▇ Plant; Other Plants..........................................................52
SECTION 6.22 Oil and Gas Reserves.................................................................52
SECTION 6.23 Initial Reserve Report...............................................................53
ARTICLE VII COVENANTS............................................................................53
SECTION 7.1 Affirmative Covenants................................................................53
SECTION 7.1.1 Financial Information, Reports, Notices, etc.........................................53
SECTION 7.1.2 Compliance with Laws, etc............................................................56
SECTION 7.1.3 Maintenance of Properties............................................................56
SECTION 7.1.4 Use of Proceeds......................................................................56
SECTION 7.1.5 Insurance............................................................................56
SECTION 7.1.6 Books and Records....................................................................57
SECTION 7.1.7 Environmental Covenant...............................................................57
SECTION 7.1.8 Further Assurances; Additional Collateral............................................58
SECTION 7.1.9 Compliance with Hedging Policy; Hedging Agreements...................................59
SECTION 7.1.10 Hedging Agreements...................................................................59
SECTION 7.1.11 Performance of Obligations...........................................................59
SECTION 7.1.12 Payment of Taxes and Claims..........................................................60
SECTION 7.1.13 ERISA Information and Compliance.....................................................60
SECTION 7.2 Negative Covenants...................................................................60
SECTION 7.2.1 Business Activities..................................................................61
SECTION 7.2.2 Indebtedness.........................................................................61
SECTION 7.2.3 Liens................................................................................61
SECTION 7.2.4 Financial Covenants..................................................................64
SECTION 7.2.5 Investments..........................................................................65
iii
SECTION 7.2.6 Restricted Payments, etc.............................................................66
SECTION 7.2.7 Rental Obligations...................................................................66
SECTION 7.2.8 Consolidation, Merger, etc...........................................................67
SECTION 7.2.9 Asset Dispositions, etc..............................................................67
SECTION 7.2.10 Subordinated Debt Documents..........................................................68
SECTION 7.2.11 Transactions with Affiliates.........................................................68
SECTION 7.2.12 Negative Pledges, Restrictive Agreements, etc........................................68
SECTION 7.2.13 Amendments to Incentive Payments Agreement...........................................69
SECTION 7.2.14 Use of Proceeds......................................................................69
ARTICLE VIII EVENTS OF DEFAULT....................................................................69
SECTION 8.1 Listing of Events of Default.........................................................69
SECTION 8.1.1 Non-Payment of Obligations...........................................................69
SECTION 8.1.2 Breach of Warranty...................................................................69
SECTION 8.1.3 Non-Performance of Certain Covenants and Obligations.................................70
SECTION 8.1.4 Non-Performance of Other Covenants and Obligations...................................70
SECTION 8.1.5 Default under Subordinated Note Documents or on Other Indebtedness...................70
SECTION 8.1.6 Judgments............................................................................70
SECTION 8.1.7 Pension Plans........................................................................71
SECTION 8.1.8 Control of the Borrower..............................................................71
SECTION 8.1.9 Bankruptcy, Insolvency, etc..........................................................71
SECTION 8.1.10 Impairment of Security, etc..........................................................71
SECTION 8.1.11 Default Under Material Agreement.....................................................72
SECTION 8.1.12 Invalidity of Loan Documents.........................................................72
SECTION 8.2 Action if Bankruptcy.................................................................72
SECTION 8.3 Action if Other Event of Default.....................................................72
ARTICLE IX THE AGENT............................................................................73
SECTION 9.1 Actions..............................................................................73
SECTION 9.2 Funding Reliance, etc................................................................73
SECTION 9.3 Exculpation..........................................................................74
SECTION 9.4 Successor............................................................................74
SECTION 9.5 Loans by BofA........................................................................75
SECTION 9.6 Credit Decisions.....................................................................75
SECTION 9.7 Copies, etc..........................................................................75
SECTION 9.8 Default; Collateral..................................................................75
SECTION 9.9 Lender Hedging Agreements............................................................77
ARTICLE X MISCELLANEOUS PROVISIONS.............................................................77
SECTION 10.1 Waivers, Amendments, Release of Collateral, etc......................................77
SECTION 10.2 Notices..............................................................................79
SECTION 10.3 Payment of Costs and Expenses........................................................79
SECTION 10.4 Indemnification......................................................................80
SECTION 10.5 Survival.............................................................................81
iv
SECTION 10.6 Severability.........................................................................81
SECTION 10.7 Headings.............................................................................81
SECTION 10.8 Execution in Counterparts............................................................81
SECTION 10.9 Governing Law; Entire Agreement......................................................81
SECTION 10.10 Successors and Assigns...............................................................81
SECTION 10.11 Sale and Transfer of Loans and Notes; Participations in Loans and Notes..............82
SECTION 10.11.1 Assignments..........................................................................82
SECTION 10.11.2 Participations.......................................................................83
SECTION 10.12 Other Transactions...................................................................83
SECTION 10.13 Forum Selection and Consent to Jurisdiction..........................................83
SECTION 10.14 Waiver of Jury Trial.................................................................84
SECTION 10.15 Confidentiality......................................................................84
SECTION 10.16 Assignment...........................................................................85
SECTION 10.17 Priority of Hedging Obligations......................................................85
SECTION 10.18 Certain Remedies.....................................................................85
SECTION 10.19 Maximum Rate.........................................................................85
SECTION 10.20 Entire Agreement.....................................................................87
v
SCHEDULES:
Schedule I - Disclosure Schedule
Schedule II - Collateral Documents to Be Delivered
Schedule III - Initial Reserve Reports
Schedule IV - Lender Addresses and Offices
Schedule V - Lender Percentages
EXHIBITS:
Exhibit A-1 - Form of Revolving Note
Exhibit A-2 - Form of Term Loan Note
Exhibit B - Form of Borrowing Request
Exhibit C - Form of Continuation/Conversion Notice
Exhibit D - Form of Lender Assignment Agreement
Exhibit E-1 - Form of Legal Opinion of ▇▇▇▇▇, ▇▇▇▇▇▇ & ▇▇▇▇▇▇ LLP
Exhibit E-2 - Form of Legal Opinion of ▇▇▇▇▇ ▇▇▇▇▇ LLP
Exhibit E-3 - Form of Legal Opinion of ▇▇▇▇▇ ▇▇▇▇▇▇▇
Exhibit F - Form of Compliance Certificate
Exhibit G - Form of Guaranty
Exhibit H-1 - Form of Borrower Pledge and Security Agreement
Exhibit H-2 - Form of Subsidiary Pledge and Security Agreement
Exhibit I - Form of First Amendment to Mortgages and Deeds of Trust
Exhibit J-1 - Form of Deed of Trust (▇▇▇▇)
Exhibit J-2 - Form of Mortgage (Lynchburg)
Exhibit K - Form of Intercreditor Agreement
Exhibit L - Form of Issuance Request
Exhibit M - Hedging Policy
vi
FOURTH AMENDED AND RESTATED
CREDIT AGREEMENT
THIS FOURTH AMENDED AND RESTATED
CREDIT AGREEMENT dated as of October
12, 2001, among MARKWEST HYDROCARBON, INC., a Delaware corporation (the
"BORROWER"), the various financial institutions as are or may become parties
hereto (collectively, the "LENDERS"), and BANK OF AMERICA, N.A. ("BOFA"), as
administrative agent for the Lenders (in such capacity, the "AGENT" or the
"ADMINISTRATIVE AGENT").
W I T N E S S E T H:
WHEREAS, the Borrower is engaged in the business of the acquisition,
ownership, operation, leasing and construction of natural gas processing and
treating plants, fractionation facilities and pipelines and oil and gas
exploration, production and development, natural gas, natural gas liquids and
crude oil marketing, storage, transportation and terminalling, and activities
related or ancillary to the foregoing;
WHEREAS, the Borrower, certain financial institutions (the "NORWEST
LENDERS"), and Norwest Bank Colorado, National Association ("NORWEST"), as
predecessor to BofA in its capacity as Administrative Agent, heretofore entered
into an Amended and Restated Working Capital Loan Agreement dated as of October
8, 1996 (such agreement, as so amended, the "WORKING CAPITAL LOAN AGREEMENT"),
pursuant to which the Norwest Lenders agreed to make loans (therein referred to
as the "ORIGINAL WORKING CAPITAL LOANS") to the Borrower;
WHEREAS, the Borrower, the Norwest Lenders, and Norwest heretofore
entered into an Amended and Restated Loan Agreement dated as of October 8, 1996
(such agreement, as so amended, the "LOAN AGREEMENT"), pursuant to which the
Norwest Lenders agreed to make loans to the Borrower;
WHEREAS, the Borrower, certain financial institutions (the "BMO
LENDERS"), NationsBank, N.A., as syndication agent, and Bank of Montreal
("BMO"), as predecessor to BofA in its capacity as Administrative Agent,
heretofore entered into that certain Amended and Restated
Credit Agreement dated
as of June 20, 1997, as amended (such agreement, as so amended, the "A&R
CREDIT
AGREEMENT"), pursuant to which the Borrower, the BMO Lenders, the syndication
agent and the Administrative Agent restructured the indebtedness of the Borrower
to the Original Lenders under the Original Loan Agreement and the Original
Working Capital Loan Agreement and amended, renewed, restated and converted such
indebtedness to indebtedness under the A&R
Credit Agreement;
WHEREAS, the Borrower, certain financial institutions (the "SECOND A&R
LENDERS"), and the Administrative Agent heretofore entered into that certain
Second Amended and Restated
Credit Agreement dated as of September 29, 1999 (the
"SECOND A&R
CREDIT AGREEMENT"), pursuant to
which the Second A&R Lenders amended, renewed, restated and restructured the
indebtedness under the A&R
Credit Agreement and agreed to make loans to the
Borrower;
WHEREAS, pursuant to assignment agreements (collectively, the "SECOND
A&R LENDER ASSIGNMENT") dated as of August 10, 2001, BofA purchased from the
Second A&R Lenders (other than BofA) all of such Second A&R Lenders' loans under
the Second A&R
Credit Agreement;
WHEREAS, immediately after giving effect to the Second A&R Lender
Assignment, the Borrower, certain financial institutions (the "EXISTING
LENDERS"), and the Administrative Agent entered into that certain Third Amended
and Restated Credit Agreement dated as of August 10, 2001 (the "EXISTING CREDIT
AGREEMENT"), pursuant to which the Existing Lenders amended, renewed, restated
and restructured the indebtedness under the Second A&R Credit Agreement and
agreed to make loans (the "EXISTING LOANS") to the Borrower;
WHEREAS, concurrently herewith, the Borrower will repay loans under
"Revolving Facility B" of the Existing Credit Agreement with working capital and
proceeds from the repayment of a portion of a loan made by the Borrower to
MarkWest Resources Canada Corp., a wholly-owned Subsidiary of Borrower, and
MarkWest Resources Canada Corp. will repay a portion of such loan with the
proceeds of a loan to it under the Canadian Credit Agreement (as herein
defined); and
WHEREAS, together with the repayment of indebtedness under "Revolving
Facility B" of the Existing Credit Agreement, Borrower, the Lenders and the
Administrative Agent hereby make further amendments to the Existing Credit
Agreement and restate the Existing Credit Agreement in its entirety.
NOW, THEREFORE, the parties hereto agree as follows:
ARTICLE I
DEFINITIONS AND ACCOUNTING TERMS
SECTION 1.1 DEFINED TERMS. The following terms (whether or not
underscored) when used in this Agreement, including its preamble and recitals,
shall, except where the context otherwise requires, have the following meanings
(such meanings to be equally applicable to the singular and plural forms
thereof) and the meanings set forth in SCHEDULES II and III to this Agreement:
"A&R CREDIT AGREEMENT" is defined in the FOURTH RECITAL.
"ACQUIRED COMPANIES" means the entities acquired by the Borrower on
August 10, 2001, pursuant to the Acquisition Contracts.
"ACQUISITION" means any transaction or series of related transactions
for the purpose of or resulting, directly or indirectly, in (a) the acquisition
of all or substantially all of the assets of a
2
Person, or of any business or division of a Person, (b) the acquisition of in
excess of 50% of the capital stock, partnership interests, membership interests
or equity of any Person, or otherwise causing any Person to become a Subsidiary,
or (c) a merger or consolidation or any other combination of the Borrower or a
Subsidiary with another Person (other than a Person that is a Subsidiary),
PROVIDED, THAT, if the Borrower is a party to such merger, consolidation or
other combination, the Borrower shall be the surviving entity, and if the
Borrower is not a party to such transaction, the Subsidiary shall be the
surviving entity.
"ACQUISITION CONTRACTS" means (a) the Share Purchase Agreement dated
August 10, ▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ Co. and the Sellers therein named with
respect to the shares of the Watford Entities and Watford Energy as therein
defined, and (b) the Share Purchase Agreement dated August 10, ▇▇▇▇, ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ Co. and ▇▇▇▇▇▇ Energy Ltd.
"ADMINISTRATIVE AGENT" is defined in the PREAMBLE and includes each
other Person as shall have subsequently been appointed as the successor
Administrative Agent pursuant to SECTION 9.4.
"AFFILIATE" of any Person means any other Person which, directly or
indirectly, controls, is controlled by or is under common control with such
Person (excluding any trustee under, or any committee with responsibility for
administering, any Plan). A Person shall be deemed to be "controlled by" any
other Person if such other Person possesses, directly or indirectly, power (a)
to vote 10% or more of the securities (on a fully diluted basis) having ordinary
voting power for the election of directors or managing general partners; or (b)
to direct or cause the direction of the management and policies of such Person
whether by contract or otherwise.
"AGREEMENT" means, on any date, this Fourth Amended and Restated Credit
Agreement as originally in effect on the Effective Date and as thereafter from
time to time amended, supplemented, amended and restated, or otherwise modified
and in effect on such date.
"ALTERNATE BASE RATE" means, on any date and with respect to all Base
Rate Loans, a fluctuating rate of interest per annum equal to the higher of (a)
the rate of interest most recently established by BofA as its base rate, and (b)
the Federal Funds Rate most recently determined by Administrative Agent (in
accordance with the definition of Federal Funds Rate) PLUS 0.5%. The Alternate
Base Rate is not necessarily intended to be the lowest rate of interest
determined by BofA in connection with extensions of credit. Changes in the rate
of interest on that portion of any Loans maintained as Base Rate Loans will take
effect simultaneously with each change in the Alternate Base Rate.
"APPLICABLE MARGIN" means, with respect to any Loan of any type or any
Letter of Credit, and at such time as the Leverage Ratio is in one of the
following ranges, the number of basis points ("b.p.") PER ANNUM for the relevant
type of Loan, Commitment Fee or Letter of Credit and the relevant range set
forth below:
3
====================================================================================================================
Leverage Ratio Applicable Margin
--------------------------------------------------------------------------------------------------------------------
Pricing LIBO Rate Letter of Base Rate Commitment
Level Loan Credit Loan Fee
--------------------------------------------------------------------------------------------------------------------
1 Less than or equal to 1.0X 150.0 b.p. 150.0 b.p. 37.5 b.p. 25.0 b.p.
--------------------------------------------------------------------------------------------------------------------
2 Greater than 1.0X but less than 175.0 b.p. 175.0 b.p. 62.5 b.p. 30.0 b.p.
or equal to 2.0X
--------------------------------------------------------------------------------------------------------------------
3 Greater than 2.0X, but less than 200.0 b.p. 200.0 b.p. 87.5 b.p. 37.5 b.p.
or equal to 2.75X
--------------------------------------------------------------------------------------------------------------------
4 Greater than 2.75X, but less 225.0 b.p. 225.0 b.p. 112.5 b.p. 50.0 b.p.
than or equal to 3.25X
--------------------------------------------------------------------------------------------------------------------
5 Greater than 3.25X 250.0 b.p. 250.0 b.p. 137.5 b.p. 50.0 b.p.
====================================================================================================================
The Leverage Ratio shall be determined from the then most recent
monthly financial statements delivered by the Borrower pursuant to
SECTION 7.1.1, and any changes in Applicable Margin shall become
effective the first day of the second month following the date such
financial statements are dated. In the event that the Borrower shall at
any time fail to furnish the Lenders such financial statements required
to be delivered under SECTION 7.1.1, the maximum Applicable Margin as
set forth above shall apply until such time as such financial
statements are so delivered. Changes in the Applicable Margin as a
result of a change in the Leverage Ratio will occur automatically as
aforesaid without notice. The Applicable Margin shall be set at Pricing
▇▇▇▇▇ ▇ for the period beginning on the Effective Date and ending on
January 31, 2002, UNLESS during such period the Leverage Ratio falls
within Pricing ▇▇▇▇▇ ▇, in which case Pricing Level 5 will apply.
"ASSIGNEE LENDER" is defined in SECTION 10.11.1.
"AUTHORIZED OFFICER" means, relative to any Obligor, those of its
officers whose signatures and incumbency shall have been certified to the
Administrative Agent and the Lenders pursuant to SECTION 5.1.1.
"BASE RATE LOAN" means a Loan bearing interest at a fluctuating rate
determined by reference to the Alternate Base Rate.
4
"BASE RATE MARGIN" means, on any date, a per annum fee equal to the
Applicable Margin for Base Rate Loans on such date.
"BASIN" means Basin Pipeline L.L.C., a Michigan limited liability
company.
"BMO" is defined in the FOURTH RECITAL.
"BOFA" is defined in the PREAMBLE.
"BORROWER" is defined in the PREAMBLE.
"BORROWING" means the Loans of the same type and, in the case of LIBO
Rate Loans, having the same Interest Period made by all Lenders on the same
Business Day and pursuant to the same Borrowing Request in accordance with
SECTION 2.1.
"BORROWING REQUEST" means a loan request and certificate duly executed
by an Authorized Officer of the Borrower, substantially in the form of EXHIBIT B
hereto.
"BUSINESS DAY" means (a) any day which is neither a Saturday or Sunday
nor a legal holiday on which banks are authorized or required to be closed in
Dallas, Texas, Denver, Colorado or New York, New York; and (b) relative to the
making, continuing, prepaying or repaying of any LIBO Rate Loans, any day on
which dealings in Dollars are carried on in the interbank eurodollar market.
"CAN" or "CAN$" means the lawful currency of Canada.
"CANADIAN ACQUISITION" means the acquisition by MarkWest Canada Co. of
the Acquired Companies pursuant to the Acquisition Contracts.
"CANADIAN COMMITMENT" means the aggregate Commitment of the Lenders
under and as defined in the Canadian Credit Agreement, expressed in U.S.
Equivalent Dollars.
"CANADIAN COMMITMENT PORTION" means at any time (a) during the
Revolving Loan Availability Period (as defined in the Canadian Credit
Agreement), an amount equal to the U.S. Dollar Equivalent of the Revolving Loan
Commitment Amount (as defined in the Canadian Credit Agreement in effect at such
time), and (b) on and after the Conversion Date (as defined in the Canadian
Credit Agreement), an amount equal to the U.S. Dollar Equivalent of the Term
Loan Principal Debt (as defined in the Canadian Credit Agreement) outstanding at
such time.
"CANADIAN CREDIT AGREEMENT" means the Credit Agreement dated as of even
date herewith among MarkWest Canada Co., as Borrower, Bank of America Canada, as
Agent, and the Lenders from time to time party thereto, as the same may from
time to time be amended and restated.
"CANADIAN FACILITY" means the credit facility pursuant to the Canadian
Credit Agreement.
5
"CANADIAN RATIO" means, at any time, (a) an amount equal to the
Canadian Commitment Portion DIVIDED BY (b) an amount equal to the sum of (i) the
U.S. Commitment Portion in effect at such time PLUS (ii) the Canadian Commitment
Portion in effect at such time.
"CANADIAN SUBSIDIARY" means any Subsidiary of Borrower formed under the
laws of Canada, or any province thereof.
"CAPITALIZED LEASE LIABILITIES" of a Person means all monetary
obligations of such Person or any of its Subsidiaries under any leasing or
similar arrangement which, in accordance with GAAP, would be classified as
capitalized leases, and, for purposes of this Agreement and each other Loan
Document, the amount of such obligations shall be the capitalized amount
thereof, determined in accordance with GAAP, and the stated maturity thereof
shall be the date of the last payment of rent or any other amount due under such
lease prior to the first date upon which such lease may be terminated by the
lessee without payment of a penalty.
"CASH COLLATERALIZE" means to pledge and deposit with or deliver to the
Administrative Agent, for the benefit of the Issuer and the Lenders, as
collateral for the Obligations in respect of Letters of Credit, cash or deposit
account balances pursuant to documentation in form and substance satisfactory to
the Administrative Agent and the Issuer (which documents are hereby consented to
by the Lenders). Derivatives of such term shall have corresponding meaning. The
Borrower hereby grants the Administrative Agent, for the benefit of the Issuer
and the Lenders, a Lien on all such cash and deposit account balances. Cash
collateral shall be maintained in blocked, non-interest bearing deposit accounts
at BofA or other institutions satisfactory to it.
"CASH EQUIVALENT INVESTMENT" means, at any time: (a) any evidence of
Indebtedness, maturing not more than one year after such time, issued or
guaranteed by the United States Government; (b) commercial paper, maturing not
more than nine months from the date of issue, which is issued by (i) a
corporation (other than an Affiliate of any Obligor) organized under the laws of
any state of the United States or of the District of Columbia and rated A-l by
Standard & Poor's Corporation or P-l by ▇▇▇▇▇'▇ Investors Service, Inc., or (ii)
any Lender (or its holding company); (c) any certificate of deposit or bankers
acceptance, maturing not more than one year after such time, which is issued by
either (i) a commercial banking institution that is a member of the Federal
Reserve System and has a combined capital and surplus and undivided profits of
not less than $250,000,000, or (ii) any Lender or an Affiliate thereof; (d) any
repurchase agreement entered into with any Lender or an Affiliate thereof (or
other commercial banking institution of the stature referred to in CLAUSE
(c)(i)) which (i) is secured by a fully perfected security interest in any
obligation of the type described in any of CLAUSES (a) through (c) and (ii) has
a market value at the time such repurchase agreement is entered into of not less
than 100% of the repurchase obligation of such Lender or Affiliate (or other
commercial banking institution) thereunder; (e) obligations of any state within
the United States of America, any nonprofit corporation or any instrumentality
of the foregoing, PROVIDED, THAT at the time of their purchase, such obligations
are rated in one of the two
6
highest letter rating categories (e.g. in the case of Standard & Poor's
Corporation, either its AAA or AA category) by a nationally recognized
securities credit rating agency; (f) obligations issued by political
subdivisions or municipalities of any state within the United States of America,
any nonprofit corporation or any instrumentality of the foregoing, PROVIDED,
THAT at the time of their purchase, such obligations are rated in one of the two
highest letter rating categories (e.g., in the case of Standard & Poor's
Corporation, either its AAA or AA category) by a nationally recognized
securities credit rating agency; or (g) eurodollar deposits with the overseas
branch of (i) any commercial banking institution that is a member of the Federal
Reserve System and has a combined capital and surplus and undivided profits of
not less than $250,000,000, or (ii) any Lender or an Affiliate thereof.
"CERCLA" means the Comprehensive Environmental Response, Compensation
and Liability Act of 1980, as amended.
"CERCLIS" means the Comprehensive Environmental Response Compensation
Liability Information System List.
"CHANGE IN CONTROL" means (a) the acquisition by any Person, or two or
more Persons acting in concert (other than ▇▇▇▇ ▇▇▇ and members of his family),
of beneficial ownership (within the meaning of Rule 13d-3 of the Securities and
Exchange Commission under the Securities Exchange Act of 1934) of 30% or more of
the outstanding shares of voting stock of the Borrower; or (b) the failure of
▇▇▇▇ ▇▇▇ and members of his family to own, free and clear of all Liens or other
encumbrances, at least 25% of the outstanding shares of voting stock of the
Borrower on a fully diluted basis.
"CODE" means the Internal Revenue Code of 1986, as amended, reformed or
otherwise modified from time to time.
"COLLATERAL" means all of the items and types of property described in
now existing or hereafter created Collateral Documents and cash and non-cash
proceeds thereof.
"COLLATERAL DOCUMENTS" means each guaranty, pledge agreement, security
agreement, mortgage, assignment, and all other security agreements, deeds of
trust, mortgages, chattel mortgages, assignments, pledges, guaranties, financing
statements, continuation statements, extension agreements and other agreements
or instruments previously delivered or now or hereafter delivered by the
Borrower or any Subsidiary of the Borrower to the Administrative Agent on behalf
of the Lenders or to the Lenders in connection with this Agreement, or any
transaction contemplated hereby, to secure or guarantee the payment of any part
of the Obligations or the performance of any other duties and obligations of
Borrower under the Loan Documents, whenever made or delivered.
"COMMITMENT" means the sum of a Lender's (a) Revolving Loan Commitment
and (b) Term Loan Commitment.
7
"COMMITMENT AMOUNT" means the sum of (a) the Revolving Loan Commitment
Amount and (b) the Term Loan Commitment Amount.
"COMMITMENT FEE" means, on any date, a per annum fee equal to the
commitment fee indicated in the pricing grid set forth in the definition of
Applicable Margin on such date.
"COMMITMENT TERMINATION DATE" means, with respect to the Revolving
Loans and Letters of Credit issued under the Revolving Facility, the Revolving
Loan Commitment Termination Date, and with respect to the Term Loans, the date
of the Borrowing of the Term Loans.
"COMMITMENT TERMINATION EVENT" means (a) the occurrence of any Default
described in CLAUSES (a) through (d) of SECTION 8.1.9; or (b) the occurrence and
continuance of any other Event of Default and either (i) the declaration of the
Loans and other Obligations to be due and payable pursuant to SECTION 8.3, or
(ii) in the absence of such declaration, the giving of notice by the
Administrative Agent, acting at the direction of the Required Lenders, to the
Borrower that the Commitments have been terminated.
"CONSOLIDATED NET INCOME" of the Borrower means, for any period, the
aggregate net income (or net loss, as the case may be) of the Borrower and its
Subsidiaries for such period on a consolidated basis, determined in accordance
with GAAP; PROVIDED, THAT there shall be excluded therefrom, without
duplication, (a) items classified as extraordinary (other than the tax benefit
of the utilization of net operating loss carry-forwards and alternative minimum
tax credits); (b) any gain or loss, net of taxes, on the sale or other
disposition of assets (including the capital stock or other equity ownership of
any other person, but excluding the sale of oil and gas inventories in the
ordinary course of business); (c) any gain or loss, net of taxes, realized on
the termination of any employee pension benefit plan; (d) any adjustments of a
deferred tax liability or asset pursuant to Statement of Financial Accounting
Standards No. 109 which result from changes in enacted tax laws or rates; (e)
the cumulative effect of a change in accounting principles; and (f) impairment
losses on oil and gas properties.
"CONTINGENT LIABILITY" means any agreement, undertaking or arrangement
by which any Person guarantees, endorses or otherwise becomes or is contingently
liable upon (by direct or indirect agreement, contingent or otherwise, to
provide funds for payment, to supply funds to, or otherwise to invest in, a
debtor, or otherwise to assure a creditor against loss) the indebtedness,
obligation or any other liability of any other Person (other than by
endorsements of instruments for deposit and/or in the course of collection), or
guarantees the payment of dividends or other distributions upon the shares of
any other Person; PROVIDED, HOWEVER, that notwithstanding the foregoing, the
definition of "Contingent Liability" shall not include (a) any contingent
payments owing by Borrower or any of its Subsidiaries in connection with Section
2 of the West Shore/Basin Purchase Agreement, and (b) Incentive Payments paid in
accordance with the Incentive Payments Agreement. The amount of any Person's
obligation under any Contingent Liability shall (subject to
8
any limitation set forth therein) be deemed to be the outstanding principal
amount (or maximum principal amount, if larger) of the debt, obligation or other
liability guaranteed thereby.
"CONTINUATION/CONVERSION NOTICE" means a notice of continuation or
conversion and certificate duly executed by an Authorized Officer of the
Borrower, substantially in the form of EXHIBIT C hereto.
"CONTROLLED GROUP" 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
Code or Section 4001 of ERISA.
"CURRENT RATIO" means the ratio of (a) consolidated current assets of
the Borrower and its Subsidiaries (including any unused portion of (i) the
Revolving Loan Commitment Amount and (ii) the Canadian Commitment) to (b)
consolidated current liabilities of the Borrower and its Subsidiaries, both as
determined in accordance with GAAP; PROVIDED, THAT for purposes of this
definition, non-▇▇▇▇ ▇▇▇▇-to-market adjustments relating to Hedging Agreements
required to be made under GAAP shall be excluded for purposes of determining
such ratio.
"DEFAULT" means any Event of Default or any condition, occurrence or
event which, after notice or lapse of time or both, would constitute an Event of
Default.
"DEFAULT RATE" means the rate of interest set forth in SECTION 3.2.2.
"DISCLOSURE SCHEDULE" means the Disclosure Schedule attached hereto as
SCHEDULE I, as it may be amended, supplemented or otherwise modified from time
to time by the Borrower with the written consent of the Administrative Agent and
the Required Lenders.
"DOLLAR" and the sign "$" mean lawful money of the United States.
"DOMESTIC OFFICE" means, relative to any Lender, the office of such
Lender designated as such on SCHEDULE IV hereto or designated in the Lender
Assignment Agreement or such other office of a Lender (or any successor or
assign of such Lender) within the United States as may be designated from time
to time by notice from such Lender, as the case may be, to each other Person
party hereto.
"DOMESTIC SUBSIDIARY" means a Subsidiary of the Borrower that is
incorporated, organized or formed under the laws of a state in the United
States.
"EBITDA" means net earnings (excluding extraordinary items, gains and
losses on sales and retirement of assets, non-cash write downs and charges
resulting from accounting convention changes) before deduction for federal and
state income taxes, Interest Expense, depreciation,
9
depletion and amortization expense and other non-cash charges and expenses,
including, without limitation, non-cash charges and expenses relating to Hedging
Agreements, of the Borrower and its Subsidiaries on a consolidated basis, all
determined in accordance with GAAP.
"EFFECTIVE DATE" means the first date all conditions precedent in
SECTION 5.1 are satisfied or waived in accordance with SECTION 10.1.
"ENVIRONMENTAL LAWS" means all applicable federal, state or local
statutes, laws, ordinances, codes, rules, regulations and guidelines (including
consent decrees and administrative orders) relating to public health and safety
and protection of the environment.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended, and any successor statute of similar import, together with the
regulations thereunder, in each case as in effect from time to time. References
to sections of ERISA also refer to any successor sections.
"ERISA AFFILIATE" shall mean each trade or business (whether or not
incorporated) which together with the Company or any Subsidiary would be deemed
to be a "single employer" within the meaning of section 4001(b)(1) of ERISA or
subsections (b), (c), (m) or (o) of section 414 of the Code.
"ERISA EVENT" shall mean (a) a "Reportable Event" described in Section
4043 of ERISA and the regulations issued thereunder, (b) 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, (c) 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, (d) the
institution of proceedings to terminate a Plan by the PBGC or (e) any other
event or condition which might constitute grounds under Section 4042 of ERISA
for the termination of, or the appointment of a trustee to administer, any Plan.
"EVENT OF DEFAULT" is defined in SECTION 8.1.
"EXISTING CREDIT AGREEMENT" is defined in the SEVENTH RECITAL.
"EXISTING LENDERS" is defined in the SEVENTH RECITAL.
"EXISTING LOANS" is defined in the SEVENTH RECITAL.
"FEDERAL FUNDS RATE" means, for any day, a fluctuating interest rate
per annum (rounded upwards to the nearest 1/100 of 1%) equal to (a) the weighted
average of the rates on overnight federal funds transactions with members of the
Federal Reserve System arranged by federal funds brokers, as published for such
day (or, if such day is not a Business Day, for the next preceding Business Day
as so published on the next succeeding Business Day) by the Federal Reserve Bank
of
10
New York; or (b) if such rate is not so published on the next succeeding
Business Day, the Federal Funds Rate for such day shall be the average rate
charged to BofA on such day on such transactions as determined by the
Administrative Agent.
"FISCAL QUARTER" means any quarter of a Fiscal Year.
"FISCAL YEAR" means any period of twelve consecutive calendar months
ending on December 31; references to a Fiscal Year with a number corresponding
to any calendar year (E.G., the "2000 Fiscal Year") refer to the Fiscal Year
ending on December 31 during such calendar year.
"FIXED CHARGES" for any period ending on a calculation date means the
sum of (a) Interest Expense for such period, PLUS (b) maintenance capital
expenses of Borrower and its Subsidiaries for such period, PLUS (c) dividends
paid, declared or required to be paid in such period in respect of preferred
stock, PLUS (d) 12.5% of the principal amount of Indebtedness (other than
Subordinated Debt) of the Borrower and its Subsidiaries of the nature referred
to in CLAUSES (a), (b), and (c) of the definition of "Indebtedness" hereunder
which is outstanding on such date of calculation.
"FIXED CHARGE COVERAGE RATIO" as of a date means the ratio of (a)
EBITDA for the 12 months ended on such date, after adjusting such EBITDA on a
pro forma basis for any assets sold (to the extent set forth in the last
sentence of this definition) or acquired after the beginning of such 12-month
period as if such assets had been sold or acquired at the beginning of such
period (PROVIDED, HOWEVER, that the Required Lenders must consent to any pro
forma adjustments to actual historical EBITDA for any assets sold or acquired)
to (b) Fixed Charges for such 12-month period. There shall be an adjustment to
EBITDA on a pro forma basis for assets sold or transferred if the fair market
value of such assets (including the transfer of Hydrocarbon Interests as
payments in kind pursuant to the Incentive Payments Agreement as permitted by
SECTION 7.2.9(b)(vi)) at the time of conveyance equals or exceeds $10,000,000 in
any calendar year.
"FOREIGN SUBSIDIARY" means a Subsidiary of the Borrower organized under
the laws of a jurisdiction outside the United States.
"F.R.S. BOARD" means the Board of Governors of the Federal Reserve
System or any successor thereto.
"GAAP" is defined in SECTION 1.4.
"GUARANTY" means any guaranty agreement or amended and restated
guaranty agreement executed and delivered pursuant to SECTION 5.1.3 or SECTION
7.1.8, substantially in the form of EXHIBIT G hereto, as amended, supplemented,
restated or otherwise modified from time to time.
"HAZARDOUS MATERIAL" means (a) any "hazardous substance" as defined by
CERCLA; (b) any "hazardous waste" as defined by the Resource Conservation and
Recovery Act, as amended;
11
(c) crude oil or any fraction thereof; or (d) any pollutant or contaminant or
hazardous, dangerous or toxic chemical, material or substance within the meaning
of any other applicable federal, state or local law, regulation, ordinance or
requirement (including consent decrees and administrative orders) relating to or
imposing liability or standards of conduct concerning any hazardous, toxic or
dangerous waste, substance or material, all as amended or hereafter amended.
"HEDGING AGREEMENT" for a Person means any interest rate swap
agreements, interest rate cap agreements, interest rate collar agreements,
commodity price protection agreements, foreign exchange protection agreements,
and all other agreements or arrangements designed to protect such Person against
fluctuations in interest rates, commodity prices, or foreign exchange rates, as
any such agreement is amendment, supplemented or otherwise modified from time to
time.
"HEDGING COUNTERPARTY" means any Person which is a counterparty to a
Hedging Agreement.
"HEDGING OBLIGATION" means, with respect to any Person, all liabilities
of such Person under any Hedging Agreement.
"HEDGING POLICY" is defined in SECTION 7.1.9.
"HEREIN," "HEREOF," "HERETO," "HEREUNDER" and similar terms contained
in this Agreement or any other Loan Document refer to this Agreement or such
other Loan Document, as the case may be, as a whole and not to any particular
section, paragraph or provision of this Agreement or such other Loan Document.
"HYDROCARBON INTERESTS" means leasehold and other interests in or under
oil, gas and other liquid or gaseous hydrocarbon leases with respect to Oil and
Gas Properties wherever located, mineral fee interests, overriding royalty and
royalty interests, net profit interests, production payment interests relating
to oil, gas or other liquid or gaseous hydrocarbons wherever located including
any reserved or residual interest of whatever nature.
"INCENTIVE PAYMENTS" means payments of the "Entitlement Amount" as
defined in and pursuant to the Incentive Payment Agreement.
"INCENTIVE PAYMENTS AGREEMENT" means collectively the Executive
Incentive and Employment Agreements dated August 10, 2001, between the Borrower
and MarkWest Canada Co. and each of ▇▇▇ ▇. ▇▇ ▇▇▇, ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, ▇▇▇ ▇.
▇▇▇▇▇▇▇▇, and ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, in the forms delivered to the Administrative
Agent pursuant to SECTION 5.1.17 and as may be amended as permitted under
ARTICLE VII.
"INCLUDE" and "INCLUDING" mean including without limiting the
generality of any description preceding such term, and, for purposes of this
Agreement and each other Loan Document, the parties
12
hereto agree that a general statement, which is followed by or referable to an
enumeration of specific matters, shall not be limited to matters similar to the
matters specifically mentioned.
"INDEBTEDNESS" of any Person means, without duplication: (a) all
obligations of such Person for borrowed money and all obligations of such Person
evidenced by bonds, debentures, notes or other similar instruments; (b) all
obligations, contingent or otherwise, relative to the face amount of all letters
of credit, whether or not drawn, and banker's acceptances issued for the account
of such Person; (c) all obligations of such Person as lessee under leases which
have been or should be, in accordance with GAAP, recorded as Capitalized Lease
Liabilities; (d) all other items which, in accordance with GAAP, would be
included as liabilities on the liability side of the balance sheet of such
Person as of the date at which Indebtedness is to be determined other than
non-cash items, such as deferred taxes, required by GAAP to be included as
liabilities on the balance sheet; (e) net liabilities of such Person under all
Hedging Obligations except for non-▇▇▇▇ ▇▇▇▇-to-market adjustments required by
GAAP; (f) all obligations of such Person to pay the deferred purchase price of
property or services which have been or should be in accordance with GAAP,
included as liabilities, and indebtedness (excluding prepaid interest thereon)
secured by a Lien on property owned or being purchased by such Person (including
indebtedness arising under conditional sales or other title retention
agreements), whether or not such indebtedness shall have been assumed by such
Person except to the extent such indebtedness is expressly non-recourse to such
Person; and (g) all Contingent Liabilities of such Person in respect of any of
the foregoing; PROVIDED, HOWEVER, that for the purposes of this definition, a
production payment or similar transaction which is non-recourse to such Person
shall not constitute "Indebtedness." For all purposes of this Agreement, the
Indebtedness of any Person shall include the Indebtedness of any partnership or
joint venture in which such Person is a general partner or a joint venturer
unless such Indebtedness is expressly non-recourse to such general partner or
joint venturer.
"INDEMNIFIED LIABILITIES" is defined in SECTION 10.4.
"INDEMNIFIED PARTIES" is defined in SECTION 10.4.
"INDEPENDENT ENGINEER" has the meaning set forth in SECTION 7.1.1(k).
"INITIAL RESERVE REPORT" means the reserve report(s) described in
SCHEDULE III.
"INSURANCE DEPOSIT ACCOUNT" is defined in SECTION 7.1.5.
"INTERCREDITOR AGREEMENT" means that certain Intercreditor Agreement
dated as of even date herewith, by and among the Administrative Agent, the
Lenders hereunder, the Canadian administrative agent under the Canadian Credit
Agreement and the lenders thereunder, as amended, supplemented, restated or
otherwise modified from time to time.
"INTEREST EXPENSE" means, for any period, for the Borrower and its
Subsidiaries on a consolidated basis, the sum of (a) all interest, premium
payments, fees, charges and related expenses
13
of the Borrower and its Subsidiaries in connection with borrowed money
(including capitalized interest and including fees payable in respect of letters
of credit and bankers' acceptances) or in connection with the deferred purchase
price of assets, in each case to the extent treated as interest in accordance
with GAAP, and (b) the portion of rent expense of the Borrower and its
Subsidiaries with respect to such period under capital leases that is treated as
interest in accordance with GAAP; PROVIDED, HOWEVER, that the issuance of PIK
Notes shall not be included in the calculation of Interest Expense.
"INTEREST PERIOD" means, relative to any LIBO Rate Loans, the period
beginning on (and including) the date on which such LIBO Rate Loan is made or
continued as, or converted into, a LIBO Rate Loan pursuant to SECTION 2.3 or 2.4
and shall end on (but exclude) the day which numerically corresponds to such
date one, two, three or six months thereafter (or, if such month has no
numerically corresponding day, on the last Business Day of such month), in
either case as the Borrower may select in its relevant notice pursuant to
SECTION 2.3 or 2.4; PROVIDED, HOWEVER, that (a) the Borrower shall not be
permitted to select Interest Periods to be in effect at any one time which have
expiration dates occurring on more than eight different dates; (b) Interest
Periods commencing on the same date for Loans comprising part of the same
Borrowing shall be of the same duration; (c) if such Interest Period would
otherwise end on a day which is not a Business Day, such Interest Period shall
end on the next following Business Day (unless, if such Interest Period applies
to LIBO Rate Loans, such next following Business Day is the first Business Day
of a calendar month, in which case such Interest Period shall end on the
Business Day next preceding such numerically corresponding day); and (d) no
Interest Period may end later than the Stated Maturity Date, and the Borrower
shall not select Interest Periods for Loans in amounts such that the Borrower
would be obligated to prepay Loans on any date other than the last day of an
Interest Period as a result of the operation of SECTION 2.2.2.
"INVESTMENT" means, relative to any Person, (a) any loan or advance
made by such Person to any other Person (excluding travel and similar advances
not to exceed $200,000 in the aggregate for all such advances to officers and
employees made in the ordinary course of business, and relocation advances made
to officers and employees in the ordinary course of business); (b) any
Contingent Liability of such Person; and (c) any ownership or similar interest
held by such Person in any other Person. The amount of any Investment shall be
the original principal or capital amount thereof less all returns of principal
or equity thereon (and without adjustment by reason of the financial condition
of such other Person) and shall, if made by the transfer or exchange of property
other than cash, be deemed to have been made in an original principal or capital
amount equal to the fair market value of such property.
"ISSUANCE REQUEST" means a request and certificate duly executed by the
chief executive, accounting or financial Authorized Officer of the Borrower,
substantially in the form of EXHIBIT K attached hereto (with such changes
thereto as may be agreed upon from time to time by the Administrative Agent, the
Issuer and the Borrower).
14
"ISSUER" means any affiliate, unit or agency of BofA or any other
Lender which has agreed to issue one or more Letters of Credit at the request of
the Administrative Agent (which shall, at the Borrower's request, notify the
Borrower from time to time of the identity of such other Lender).
"▇▇▇▇▇▇" shall have the meaning given to it in the Acquisition
Contracts.
"LENDER ASSIGNMENT AGREEMENT" means a Lender Assignment Agreement,
substantially in the form of EXHIBIT D hereto.
"LENDER HEDGING AGREEMENT" means any Hedging Agreements entered into by
Borrower or any of its Subsidiaries in which a Lender or an Affiliate of a
Lender is the Hedging Counterparty.
"LENDERS" is defined in the preamble.
"LETTER OF CREDIT" is defined in SECTION 2.7.
"LETTER OF CREDIT COMMITMENT" means, relative to any Lender, such
Lender's obligation to issue (in the case of an Issuer) or participate in (in
the case of all Lenders) Letters of Credit pursuant to SECTION 2.1.2.
"LETTER OF CREDIT OUTSTANDINGS" means, at any time, an amount equal to
the sum of (a) the aggregate Stated Amount at such time of all Letters of Credit
then outstanding and undrawn (as such aggregate Stated Amount shall be adjusted,
from time to time, as a result of drawings, the issuance of Letters of Credit,
or otherwise), PLUS (b) the then aggregate amount of all unpaid and outstanding
Reimbursement Obligations.
"LETTER OF CREDIT SUBLIMIT" means $10,000,000.
"LEVERAGE RATIO" means, as of a date, the ratio of (a) Total Funded
Debt to (b) EBITDA for the 12 months most recently ended prior to such date,
after adjusting such EBITDA on a pro forma basis for any assets sold (to the
extent set forth in the last sentence of this definition) or acquired after the
beginning of such most recently ended 12 months as if such assets had been sold
or acquired at the beginning of such twelve most recently ended months;
PROVIDED, HOWEVER, that the Required Lenders must consent to any pro forma
adjustments made to actual historical EBITDA for any asset which Borrower or any
of its Subsidiaries has sold or acquired. There shall be an adjustment to EBITDA
on a pro forma basis for assets sold or transferred if the fair market value of
such assets at the time of conveyance (including the transfer of Hydrocarbon
Interests as payments in kind pursuant to the Incentive Payments Agreement as
permitted by SECTION 7.2.9(b)(vi)) equals or exceeds $10,000,000 in any calendar
year.
"LIBO RATE" means, relative to any Interest Period for LIBO Rate Loans,
the rate of interest equal to the average (rounded upwards, if necessary, to the
nearest 1/16 of 1%) of the rates per
15
annum at which Dollar deposits in immedaitely available funds are offered to
BofA's LIBOR Office in the interbank eurodollar market as at or about 11:00
a.m., Central time, two Business Days prior to the beginning of such Interest
Period for delivery on the first day of such Interest Period, and in an amount
approximately equal to the amount of BofA's LIBO Rate Loan and for a period
approximately equal to such Interest Period.
"LIBO RATE LOAN" means a Loan bearing interest, at all times during an
Interest Period applicable to such Loan, at a fixed rate of interest determined
by reference to the LIBO Rate (Reserve Adjusted).
"LIBO RATE (RESERVE ADJUSTED)" means, relative to any Loan to be made,
continued or maintained as, or converted into, a LIBO Rate Loan for any Interest
Period, a rate per annum (rounded upwards, if necessary, to the nearest 1/16 of
1%) determined pursuant to the following formula:
LIBO Rate = LIBO RATE
(Reserve Adjusted) -----------------------
1.00 - LIBOR Reserve Percentage
The LIBO Rate (Reserve Adjusted) for any Interest Period for LIBO Rate
Loans will be determined by the Administrative Agent on the basis of the LIBOR
Reserve Percentage in effect on, and the applicable LIBO Rates furnished to and
received by the Administrative Agent from BofA, two Business Days before the
first day of such Interest Period.
"LIBOR OFFICE" means, relative to any Lender, the office of such Lender
designated as such on SCHEDULE IV hereto or designated in the Lender Assignment
Agreement or such other office of a Lender as designated from time to time by
notice from such Lender to the Borrower and the Administrative Agent, whether or
not outside the United States, which shall be making or maintaining LIBO Rate
Loans of such Lender hereunder.
"LIBOR RESERVE PERCENTAGE" means, relative to any Interest Period for
LIBO Rate Loans, the reserve percentage (expressed as a decimal) equal to the
maximum aggregate reserve requirements (including all basic, emergency,
supplemental, marginal and other reserves and taking into account any
transitional adjustments or other scheduled changes in reserve requirements)
specified under regulations issued from time to time by the F.R.S. Board and
then applicable to assets or liabilities consisting of and including
"Eurocurrency Liabilities," as currently defined in Regulation D of the F.R.S.
Board, having a term approximately equal or comparable to such Interest Period.
"LIEN" means any security interest, mortgage, pledge, hypothecation,
assignment, deposit arrangement, encumbrance, lien (statutory or otherwise),
charge against or interest in property to secure payment of a debt or
performance of an obligation or other priority or preferential arrangement of
any kind or nature whatsoever.
16
"LOAN" means, as the context may require, a Revolving Loan or a Term
Loan of any type.
"LOAN AGREEMENT" is defined in the THIRD RECITAL.
"LOAN DOCUMENTS" means this Agreement, the Notes, each of the
Collateral Documents, each Guaranty, any Subordination Agreement, the
Intercreditor Agreement, and each other agreement, document or instrument
delivered by the Borrower or any of its Subsidiaries from time to time in
connection with this Agreement and the Notes. In addition, references to "Loan
Documents" in the Collateral Documents shall include Lender Hedging Agreements.
"MARGIN STOCK" means margin stock as defined in Regulation U.
"MARKWEST 401(k) PLAN" means the MarkWest Hydrocarbon, Inc. 401(k)
Savings & Profit Sharing Plan dated April 1, 1988, restated January 1, 1997 and
amended November 1, 1998, the purpose of which is to enable eligible employees
to save for retirement and to provide certain benefits in the event of death,
disability, or other termination of employment. The MarkWest 401(k) Plan is for
the exclusive benefit of eligible employees of the Borrower and their
beneficiaries.
"MARKWEST MICHIGAN" means MarkWest Michigan, Inc., a Colorado
corporation.
"MARKWEST CANADA CO." means MarkWest Resources Canada Corp., a
corporation organized pursuant to the laws of the province of Alberta, Canada
and a Wholly-Owned Subsidiary.
"MARKWEST RESOURCES" means MarkWest Resources, Inc., a Colorado
corporation.
"MATERIAL ADVERSE EFFECT" means with respect to any matter that such
matter could reasonably be expected to materially and adversely affect the
assets, business, properties, financial condition or prospects, or results or
operations of the Borrower and its Subsidiaries taken as a whole, or the ability
of the Borrower or any other Obligor to perform in a material respect its
respective obligations under any of the Loan Documents.
"MATREX" means Matrex, L.L.C., a Michigan limited liability company.
"MONTHLY PAYMENT DATE" means the last day of each calendar month or, if
any such day is not a Business Day, the next succeeding Business Day.
"NOTE" means a promissory note of the Borrower payable to any Lender,
in substantially the form of EXHIBIT A-1 and EXHIBIT A-2 hereto (as such
promissory note may be amended, endorsed or otherwise modified from time to
time), evidencing the aggregate Obligations of the Borrower to such Lender
resulting from outstanding Revolving Loans, Term Loans and Reimbursement
Obligations, and also means all other promissory notes accepted from time to
time in substitution therefor or renewal thereof.
17
"OBLIGATIONS" means all obligations (monetary or otherwise) of the
Borrower and each other Obligor arising under or in connection with this
Agreement, the Notes, the Reimbursement Obligations and each other Loan
Document. In addition, all references to "Obligations" in the Collateral
Documents and in SECTIONS 4.8, 4.9 and 10.17 shall, in addition to the
foregoing, also include all present and future indebtedness, liabilities and
obligations (and all renewals and extensions thereof or any part thereof) now or
hereafter owed by the Borrower and each other Obligor to any Lender or any
Affiliate of a Lender pursuant to a Lender Hedging Agreement.
"OBLIGOR" means the Borrower or any other Person (other than the
Administrative Agent or any Lender) obligated under any Loan Document.
"OIL AND GAS" means petroleum, natural gas and other related
hydrocarbons or minerals or any of them and all other substances produced or
extracted in association therewith.
"OIL AND GAS PROPERTIES" means Hydrocarbon Interests now owned or
hereafter acquired by the Borrower and its Subsidiaries and contracts executed
in connection therewith and all tenements, hereditaments, appurtenances, and
properties belonging, affixed or incidental to such Hydrocarbon Interests,
including, without limitation, any and all property, real or personal, now owned
by the Borrower and its Subsidiaries and situated upon or to be situated upon,
and used, built for use, or useful in connection with the operating, working or
developing of such Hydrocarbon Interests, including, without limitation, any and
all petroleum and/or natural gas ▇▇▇▇▇, buildings, structures, field separators,
liquid extractors, plant compressors, pumps, pumping units, field gathering
systems, tank and tank batteries, fixtures, valves, fittings, machinery and
parts, engines, boilers, liters, apparatus, equipment, appliances, tools,
implements, cables, wires, towers, taping, tubing and rods, surface leases,
rights-of-way, easements and servitudes, and all additions, substitutions,
replacements for, fixtures and attachments to any and all of the foregoing owned
directly or indirectly by the Borrower and its Subsidiaries.
"ORGANIC DOCUMENT" means, relative to any Obligor, its certificate of
incorporation, articles of formation, operating agreement, its by-laws and all
shareholder agreements, voting trusts and similar arrangements applicable to any
of its authorized shares of capital stock or equity interests.
"PARTICIPANT" is defined in SECTION 10.11.
"PBGC" means the Pension Benefit Guaranty Corporation and any entity
succeeding to any or all of its functions under ERISA.
"PENSION PLAN" means a "pension plan," as such term is defined in
section 3(2) of ERISA, which is subject to Title IV of ERISA (other than a
multiemployer plan as defined in section 4001(a)(3) of ERISA), and to which the
Borrower or any corporation, trade or business that is, along with the Borrower,
a member of a Controlled Group, may have liability, including any liability by
18
reason of having been a substantial employer within the meaning of section 4063
of ERISA at any time during the preceding five years, or by reason of being
deemed to be a contributing sponsor under section 4069 of ERISA.
"PERCENTAGE" means, relative to any Lender, the percentage set forth on
SCHEDULE V hereto or set forth in a Lender Assignment Agreement, as such
percentage may be adjusted from time to time pursuant to Lender Assignment
Agreement(s) executed by such Lender and its Assignee Lender(s) and delivered
pursuant to SECTION 10.11; PROVIDED, THAT the sum of all Percentages for all
Lenders shall never be less than 100%.
"PERMITTED LIENS" has the meaning set forth in SECTION 7.2.3.
"PERSON" means any natural person, corporation, partnership, firm,
association, trust, government, governmental agency or any other entity, whether
acting in an individual, fiduciary or other capacity.
"PIK NOTES" means Subordinated Notes that may be issued pursuant to the
Subordinated Debt Documents in connection with the Borrower's exercise of its
option to elect to pay accrued and unpaid interest on Subordinated Debt by
delivery of additional Subordinated Notes.
"PLAN" means any Pension Plan or Welfare Plan.
"PRINCIPAL PAYMENT DATE" is defined in SECTION 3.1(b).
"PROJECTIONS" means the Borrower's budget for 2001 and three-year
projections delivered to the Administrative Agent pursuant to the Existing
Credit Agreement.
"QUARTERLY PAYMENT DATE" means the last day of each March, June,
September, and December or, if any such day is not a Business Day, the next
succeeding Business Day.
"QUARTERLY STATUS REPORT" means a status report prepared quarterly by
the Borrower in form, scope and content acceptable to the Administrative Agent,
(a) detailing production from the Oil and Gas Properties, the volumes of Oil and
Gas produced and saved, the volumes of Oil and Gas sold, gross revenue, net
income, related leasehold operating expenses, severance taxes, other taxes,
capital costs and any production imbalances incurred during such period, (b)
describing the Borrower's position regarding its Hedging Agreements with respect
to its Oil and Gas Properties including the amount contracted in volumes and as
a percentage of such company's total anticipated production, length of
contracts, and the price or prices hedged, and (c) setting forth such additional
information with respect to any of Borrower's Oil and Gas Properties as may be
reasonably requested by Administrative Agent, in each case for such quarter then
ended.
19
"REDEEMABLE PREFERRED STOCK" means preferred stock that has, or is
convertible into any security that has, mandatory redemption or repurchase
requirements (other than those exercisable solely at the option of the issuer of
said stock) on or prior to the date set forth in the definition of Stated
Maturity Date.
"REGULATION U" means Regulation U of the Board of Governors of the
Federal Reserve System.
"REIMBURSEMENT OBLIGATION" is defined in SECTION 2.7.6.
"RELEASE" means a "release," as such term is defined in CERCLA.
"REQUIRED LENDERS" means, at any time, the Administrative Agent and two
or more Lenders holding at least 66% of the then aggregate outstanding principal
amount of the Notes then held by the Lenders, or, if no such principal amount is
then outstanding, the Administrative Agent and Lenders having at least 66% of
the aggregate Commitments.
"RESERVE REPORT" means a report, prepared in accordance with guidelines
and requirements of the Securities and Exchange Commission in form acceptable to
the Administrative Agent, covering proved developed and proved undeveloped Oil
and Gas reserves attributable to Borrower's and its Subsidiaries' Oil and Gas
Properties, and setting forth with respect thereto (a) the total quantity of
proved developed and proved undeveloped reserves (separately classified as to
producing, shut-in, behind pipe, and undeveloped), (b) the estimated future net
revenues and cumulative estimated future net revenues, (c) the present
discounted value of future net revenues, and (d) such other information and data
with respect to the Oil and Gas Properties as the Administrative Agent may
reasonably request.
"RESOURCE CONSERVATION AND RECOVERY ACT" means the Resource
Conservation and Recovery Act, 42 U.S.C. Section 690, ET SEQ., as in effect from
time to time.
"REVOLVING FACILITY" means the credit facility described as the
"Revolving Facility" in SECTION 2.1.1.
"REVOLVING LOAN" means a loan made pursuant to SECTION 2.1.1.
"REVOLVING LOAN COMMITMENT" means relative to any Lender, such Lender's
obligation to continue the Existing Loans as Revolving Loans and to make
subsequent Revolving Loans pursuant to SECTION 2.1.1.
"REVOLVING LOAN COMMITMENT AMOUNT" means, on any date, $55,000,000, as
such amount may be increased from time to time pursuant to SECTION 2.1.6 and as
may be reduced from time to time pursuant to SECTION 2.2.
20
"REVOLVING LOAN COMMITMENT TERMINATION DATE" means the earliest of (a)
▇▇▇▇▇▇ ▇, ▇▇▇▇, (▇) the date on which the Revolving Loan Commitment Amount is
terminated in full or reduced to zero pursuant to SECTION 2.2, and (c) the date
on which any Commitment Termination Event occurs. Upon the occurrence of any
event described in CLAUSE (b) or (c), the Revolving Loan Commitments shall
terminate automatically and without any further action.
"REVOLVING NOTE" means the promissory note issued to each Lender under
this Agreement to evidence the Borrower's obligations to repay the Revolving
Loans made hereunder, each such note to be substantially in the form of EXHIBIT
A-1.
"RIGHTS" means rights, remedies, powers, privileges and benefits.
"SECOND A&R CREDIT AGREEMENT" is defined in the FIFTH RECITAL.
"SECOND A&R LENDER ASSIGNMENT" is defined in the SIXTH RECITAL.
"SECOND A&R LENDERS" is defined in the FIFTH RECITAL.
"STATED AMOUNT" of each Letter of Credit means the face amount of such
Letter of Credit as such amount is in effect on the issuance date thereof.
"STATED EXPIRY DATE" is defined in SECTION 2.7.1.
"STATED MATURITY DATE" means, for any Revolving Loan, Letter of Credit,
and Term Loan, August 9, 2005.
"SUBORDINATED DEBT" means Indebtedness of the Borrower that the
Borrower designates as "Subordinated Indebtedness" hereunder by giving written
notice to the Administrative Agent, which Indebtedness is issued upon, and that
is governed by documents containing, terms and conditions satisfactory to the
Required Lenders in their sole discretion and that is subordinated to the
Obligations upon terms and conditions satisfactory to the Required Lenders in
their sole discretion.
"SUBORDINATED DEBT DOCUMENTS" means documents executed in connection
with Subordinated Debt.
"SUBORDINATED NOTES" means promissory notes evidencing Subordinated
Debt.
"SUBORDINATION AGREEMENT" means a subordination agreement or other
agreement containing the terms upon which Subordinated Debt is subordinated to
the Obligations.
21
"SUBSIDIARY" of a Person means a corporation, partnership, joint
venture, limited liability company or other business entity of which a majority
of the shares of securities or other interests having ordinary voting power for
the election of directors or other governing body (other than securities or
interests having such power only by reason of the happening of a contingency)
are at the time beneficially owned, or the management of which is otherwise
controlled, directly, or indirectly through one or more intermediaries, or both,
by such Person. Unless otherwise specified, all references herein to a
"Subsidiary" or to "Subsidiaries" shall refer to a Subsidiary or Subsidiaries of
the Borrower.
"TANGIBLE NET WORTH" means the consolidated net worth of the Borrower
and its Subsidiaries (excluding any Redeemable Preferred Stock) after
subtracting therefrom the aggregate amount of any Intangible Assets of the
Borrower and its Subsidiaries. "INTANGIBLE ASSETS" means the amount (to the
extent reflected in determining consolidated net worth) of all unamortized debt
discount and expense (to the extent, if any, recorded as an unamortized deferred
charge), unamortized deferred charges, goodwill, franchises, licenses, patents,
trademarks, trade names, copyrights, service marks and brand names; PROVIDED,
THAT for purposes of this definition, consolidated net worth shall be adjusted
to exclude non-cash items, including foreign currency translation adjustments,
unrealized gains and losses, and ▇▇▇▇-to-market adjustments relating to Hedging
Agreements, pursuant to GAAP.
"TAXES" is defined in SECTION 4.6.
"TERM LOAN" means the term loan of each Lender made pursuant to SECTION
2.1.4.
"TERM LOAN COMMITMENT" means, relative to any Lender, such Lender's
obligation to make a Term Loan pursuant to SECTION 2.1.4.
"TERM LOAN COMMITMENT AMOUNT" means an amount (subject to reduction or
cancellation as herein provided) equal to $40,000,000.
"TERM LOAN FACILITY" means the term credit facility as described in and
subject to the limitations set forth in SECTION 2.1.4.
"TERM LOAN NOTE" means the promissory note issued to each Lender under
this Agreement to evidence the Borrower's obligations to repay the Term Loan,
each such note to be substantially in the form of EXHIBIT A-2.
"TERM LOAN PRINCIPAL DEBT" means, on any date of determination, the
aggregate unpaid principal balance of all Borrowings under the Term Loan
Facility.
"TOTAL FUNDED DEBT" means, as of any date, the sum without duplication
of (a) the outstanding principal amount of all Indebtedness of the Borrower and
its Subsidiaries of the nature referred to in CLAUSES (a), (b), (c) and (f) of
the definition of Indebtedness and (b) all Redeemable
22
Preferred Stock, valued at the redemption price thereof; PROVIDED, HOWEVER,
that in the event that Borrower's "working capital" (determined in accordance
with GAAP) is greater than $0 at any time at which the Borrower's Total
Funded Debt is calculated, then Total Funded Debt for such time period shall
equal the outstanding principal amount of all Indebtedness of the Borrower
and its Subsidiaries of the nature referred to in CLAUSES (a), (b), (c) and
(f) of the definition of Indebtedness PLUS all Redeemable Preferred Stock,
LESS cash on hand or Cash Equivalent Investments which are free and clear of
all Liens other than Liens securing the Loans.
"TYPE" means, relative to any Loan, the portion thereof, if any, being
maintained as a Base Rate Loan or a LIBO Rate Loan.
"U.C.C." means the Uniform Commercial Code, as in effect in the State
of Texas.
"UNITED STATES" or "U.S." means the United States of America, its fifty
states and the District of Columbia.
"U.S. COMMITMENT PORTION" at any time means an amount equal to the
Revolving Loan Commitment Amount in effect at such time plus the aggregate
principal amount of the Term Loan Principal Debt then outstanding.
"U.S. DOLLAR EQUIVALENT" means, on any day, with respect to an amount
denominated in CAN$, the amount of Dollars required to purchase the relevant
stated amount of CAN$ based on the Noon Rate (as defined in the Canadian Credit
Agreement) in effect on such day.
"WATFORD" shall have the meaning given to it in the Acquisition
Contracts.
"WELFARE PLAN" means a "welfare plan," as such term is defined in
section 3(1) of ERISA.
"WEST SHORE" means West Shore Processing Company, L.L.C., a Michigan
limited liability company.
"WEST SHORE/BASIN PURCHASE AGREEMENT" means that certain Purchase and
Sale Agreement dated as of November 21, 1997, between Michigan Energy Company
and MarkWest Michigan.
"WHOLLY-OWNED SUBSIDIARY" means a Subsidiary of the Borrower of which
all of the equity is owned by the Borrower.
"WORKING CAPITAL LOAN AGREEMENT" is defined in the SECOND RECITAL.
SECTION 1.2 USE OF DEFINED TERMS. Unless otherwise defined or the
context otherwise requires, terms for which meanings are provided in this
Agreement shall have such meanings when used in the Disclosure Schedule and in
each Note, Borrowing Request, Continuation/Conversion
23
Notice, Loan Document, notice and other communication delivered from time to
time in connection with this Agreement or any other Loan Document.
SECTION 1.3 CROSS-REFERENCES. Unless otherwise specified, references in
this Agreement and in each other Loan Document to any Article or Section are
references to such Article or Section of this Agreement or such other Loan
Document, as the case may be, and, unless otherwise specified, references in any
Article, Section or definition to any clause are references to such clause of
such Article, Section or definition.
SECTION 1.4 ACCOUNTING AND FINANCIAL DETERMINATIONS. Unless otherwise
specified, all accounting terms used herein or in any other Loan Document shall
be interpreted, all accounting determinations and computations hereunder or
thereunder (including under SECTION 7.2.4) shall be made, and all financial
statements required to be delivered hereunder or thereunder shall be prepared in
accordance with, those generally accepted accounting principles ("GAAP") applied
in the preparation of the financial statements referred to in SECTION 6.5.
ARTICLE II
COMMITMENTS, BORROWING PROCEDURES AND NOTES
SECTION 2.1 COMMITMENTS. On the terms and subject to the conditions of
this Agreement (including ARTICLE V), each Lender severally, to the extent of
its Percentage, agrees to make Loans pursuant to the Commitments described in
this SECTION 2.1.
SECTION 2.1.1 REVOLVING LOAN COMMITMENT.
(a) On the Effective Date, all outstanding Existing Loans
(other than Existing Loans under "Revolving Facility B" of the Existing Credit
Agreement, which shall be repaid) shall be amended, renewed, restated, extended
and converted (but shall not be deemed to be repaid) to Revolving Loans under
this Agreement.
(b) Each Lender severally, but not jointly, agrees to
lend to the Borrower such Lender's Percentage of one or more Borrowings under
the Revolving Facility, not to exceed such Lender's Percentage of the Revolving
Loan Commitment Amount.
(c) Subject to the conditions set forth in this
Agreement, Revolving Loans under the Revolving Facility may be made during the
period beginning on the Effective Date and ending on the day prior to the
Revolving Loan Commitment Termination Date.
(d) On the terms and subject to the conditions hereof,
the Borrower may from time to time borrow, prepay and reborrow Revolving Loans.
24
SECTION 2.1.2 COMMITMENT TO ISSUE LETTERS OF CREDIT. From time to time
on any Business Day prior to the Commitment Termination Date, each Issuer will
issue, and each Lender will participate in, to the extent of each Lender's
Percentage, the Letters of Credit, in accordance with the terms of SECTION 2.7.
SECTION 2.1.3 [INTENTIONALLY LEFT BLANK].
SECTION 2.1.4 TERM LOAN COMMITMENT. Subject to and in reliance upon the
terms and conditions hereof, each Lender severally, but not jointly, agrees to
lend to Borrower in a single disbursement on the Effective Date such Lender's
Percentage of the Term Loan Commitment. If all or a portion of the Term Loan
Principal Debt is paid or prepaid, then the amount so paid or prepaid may not be
reborrowed. Any portion of the Term Loan Commitment that remains undisbursed
after the initial disbursement under the Term Loan Facility shall be reduced to
zero and cancelled on the date of such initial disbursement.
SECTION 2.1.5 LENDERS NOT REQUIRED TO MAKE LOANS OR ISSUE OR
PARTICIPATE IN LETTERS OF CREDIT. No Lender shall be permitted or required to
(a) continue any Existing Loan as a Loan hereunder or to make any Revolving Loan
if, after giving effect thereto, (i) the aggregate outstanding principal amount
of all Revolving Loans of all Lenders, together with all Letter of Credit
Outstandings, would exceed the Revolving Loan Commitment Amount, or (ii) the
aggregate outstanding principal amount of all Revolving Loans of such Lender,
together with its Percentage of all Letter of Credit Outstandings, would exceed
such Lender's Percentage of the Revolving Loan Commitment Amount, or (b) issue
(in the case of any Issuer) or participate in (in the case of each Lender) any
Letter of Credit if, after giving effect thereto, (i) all Letter of Credit
Outstandings together with the aggregate outstanding principal amount of all
Loans of all Lenders would exceed the Revolving Loan Commitment Amount, or (ii)
such Lender's Percentage of all Letter of Credit Outstandings together with the
aggregate outstanding principal amount of all Loans of such Lender would exceed
such Lender's Percentage of the Revolving Loan Commitment Amount, or (iii) all
Letter of Credit Outstandings would exceed the Letter of Credit Sublimit.
SECTION 2.1.6 INCREASE IN REVOLVING LOAN COMMITMENT AMOUNT.
(a) Through and including December 31, 2003, the Borrower
may, by written notice (the "INCREASE NOTICE") to the Administrative Agent (and
the Administrative Agent shall promptly deliver a copy of such notice to the
Lenders), request that the aggregate amount of the Revolving Loan Commitment
Amount be increased by an amount not less than $5,000,000 to $75,000,000;
PROVIDED, THAT the aggregate amount of the Revolving Loan Commitment Amount
hereunder PLUS the Canadian Commitment shall not exceed $110,000,000, MINUS any
amount by which the Revolving Loan Commitment Amount shall have been reduced
pursuant to SECTION 2.2, and MINUS any amount by which the Canadian Commitment
shall have been reduced pursuant to the provisions of the Canadian Credit
Agreement. The Increase Notice shall set forth the amount of the requested
increase in the Revolving Loan Commitment Amount and the date on which such
increase
25
is requested to become effective (which shall be not less than 30 days or more
than 60 days after the date of such notice), and at the Borrower's option, may
offer to one or more existing Lenders and/or other banks or financial
institutions (any such Lender or other bank or other institution referred to in
this CLAUSE (a) being called an "AUGMENTING LENDER") the opportunity to extend
credit hereunder or increase their existing Revolving Loan Commitment Amount in
an aggregate amount equal to the proposed increase; PROVIDED, THAT no Lender
shall be obligated to agree to increase its Revolving Loan Commitment Amount
and, PROVIDED FURTHER, that each Augmenting Lender, if not already a Lender
hereunder, shall be subject to the approval of the Administrative Agent (which
approval shall not be unreasonably withheld) and the Borrower and each such
Augmenting Lender shall execute all such documentation as the Administrative
Agent shall reasonably specify to evidence its Revolving Loan Commitment Amount
and status as a Lender hereunder.
(b) On the effective date (the "INCREASE EFFECTIVE DATE")
of any increase in the Revolving Loan Commitment Amount pursuant to this SECTION
2.1.6 (the "COMMITMENT INCREASE"), (i) the aggregate principal amount of the
Loans outstanding (the "INITIAL LOANS") immediately prior to giving effect to
the Commitment Increase on the Increase Effective Date shall be deemed to be
paid, (ii) each Augmenting Lender that shall have been a Lender prior to the
Commitment Increase shall pay to the Administrative Agent in same day funds an
amount equal to the difference between (A) the product of (1) such Lender's
Percentage of the Commitment (the "PRO RATA SHARE") (calculated after giving
effect to the Commitment Increase) multiplied by (2) the amount of the
Subsequent Loans (as hereinafter defined) and (B) the product of (1) such
Lender's Pro Rata Share (calculated without giving effect to the Commitment
Increase) multiplied by (2) the amount of the Initial Loans, (iii) each
Augmenting Lender that shall not have been a Lender prior to the Commitment
Increase shall pay to Administrative Agent in same day funds an amount equal to
the product of (1) such Augmenting Lender's Pro Rata Share (calculated after
giving effect to the Commitment Increase) multiplied by (2) the amount of the
Subsequent Loans, and (iv) after the Administrative Agent receives the funds
specified in CLAUSES (ii) and (iii) above, the Administrative Agent shall pay to
each Lender whose Commitment is not being increased (a "NON-INCREASING LENDER")
the portion of such funds that is equal to the difference between (A) the
product of (1) such Non-Increasing Lender's Pro Rata Share (calculated without
giving effect to the Commitment Increase) multiplied by (2) the amount of the
Initial Loans, and (B) the product of (1) such Non-Increasing Lender's Pro Rata
Share (calculated after giving effect to the Commitment Increase) multiplied by
(2) the amount of the Subsequent Loans, (v) after the effectiveness of the
Commitment Increase, the Borrower shall be deemed to have made new Borrowings
(the "SUBSEQUENT LOANS") in an aggregate principal amount of the Initial Loans
and of the types and for the Interest Periods specified in a Borrowing Request
delivered to the Administrative Agent in accordance with SECTION 2.2, (vi) each
Non-Increasing Lender and each Augmenting Lender shall be deemed to hold its Pro
Rata Share of each Subsequent Loan (each calculated after giving effect to the
Commitment Increase) and (vii) the Borrower shall pay each Augmenting Lender
that shall have been a Lender prior to the Commitment Increase and each
Non-Increasing Lender any and all accrued but unpaid interest on the Initial
Loans. The deemed payments made pursuant to CLAUSE (i) above in respect of each
LIBO Rate Loan shall be subject to indemnification by the Borrower pursuant to
the provisions
26
of SECTION 4.4 if the Increase Effective Date occurs other than on the last day
of the Interest Period relating thereto and breakage costs result.
(c) Increases and new Revolving Loan Commitment Amount
created pursuant to this SECTION 2.1.6 shall become effective on the date
specified in the notice delivered by the Borrower pursuant to the first sentence
of PARAGRAPH (a) above.
(d) No increase in the total Revolving Loan Commitment
Amount (or in the Commitment of any Lender) or addition of a new Lender shall
become effective under this section unless (i) the Borrower shall deliver a
certificate of an Authorized Officer, dated as of the Increase Effective Date,
certifying that no Default shall have occurred and be continuing and that the
representations and warranties of the Borrower contained in this Agreement are
true and correct on and as of such date, and (ii) the Administrative Agent shall
have received documents and an opinion consistent with those delivered on the
Effective Date under SECTIONS 5.1.1 and 5.1.7 as to the corporate authority of
the Borrower to borrow hereunder after giving effect to such increase.
(e) Notwithstanding the foregoing, no increase in the
Revolving Loan Commitment Amount may be made pursuant to this SECTION 2.1.6
unless, after such increase, the Percentage of each Lender hereunder is the same
as the pro rata share of such Lender or its Affiliate in the aggregate
Commitments under and as defined in the Canadian Credit Agreement.
SECTION 2.2 REDUCTION OF COMMITMENT AMOUNTS. The Commitment Amounts are
subject to reduction from time to time pursuant to this SECTION 2.2.
SECTION 2.2.1 OPTIONAL REDUCTIONS. The Borrower may, from time to time
on any Business Day, voluntarily reduce the Commitment Amount; PROVIDED,
HOWEVER, that all such reductions shall require at least three Business Days'
prior notice to the Administrative Agent and be permanent, and any partial
reduction of any Commitment Amount shall be in a minimum amount of $2,500,000,
and greater integral multiples of $500,000.
SECTION 2.2.2 MANDATORY REDUCTIONS. On March 31, 2004, and on the last
day of each fiscal quarter thereafter, the Revolving Loan Commitment Amount
shall, without any further action, automatically and permanently be reduced by
an amount equal to the GREATER OF (a) $3,667,000, and (b) 6.67% of the aggregate
Revolving Loan Commitment in effect on such day; PROVIDED, HOWEVER, that on the
Stated Maturity Date, the Revolving Loan Commitment Amount shall be zero.
Voluntary reductions of the Revolving Loan Commitment Amount made pursuant to
SECTION 2.2.1 shall be applied to diminish the amount of scheduled reductions to
such Revolving Loan Commitment Amount thereafter becoming effective pursuant to
this Section pro rata.
SECTION 2.3 BORROWING PROCEDURE. By delivering a Borrowing Request to
the Administrative Agent on or before 10:00 a.m., Central time, on a Business
Day, the Borrower may from time to time irrevocably request (a) on not less than
three nor more than five Business Days'
27
notice, a LIBO Rate Loan, or (b) on not less than the same day or more than five
Business Days' notice, a Base Rate Loan, in a minimum amount of $500,000, and
greater integral multiples of $500,000, or in the unused amount of the
applicable Commitment, if less. On the terms and subject to the conditions of
this Agreement, each Borrowing shall be comprised of the type of Loans, and
shall be made on the Business Day specified in such Borrowing Request. On or
before 11:00 a.m., Central time, on such specified Business Day, each Lender
shall deposit with the Administrative Agent same day funds in an amount equal to
such Lender's Percentage of the requested Borrowing. Such deposit will be made
to an account which the Administrative Agent shall specify from time to time by
notice to the Lenders. To the extent funds are received from the Lenders, the
Administrative Agent shall make such funds available to the Borrower by wire
transfer to the accounts the Borrower shall have specified in its Borrowing
Request. No Lender's obligation to make any Loan shall be affected by any other
Lender's failure to make any Loan.
SECTION 2.4 CONTINUATION AND CONVERSION ELECTIONS. By delivering a
Continuation/Conversion Notice to the Administrative Agent on or before 10:00
a.m., Central time, on a Business Day, the Borrower may from time to time
irrevocably elect (a) on not less than three nor more than five Business Days'
notice, in connection with any LIBO Rate Loan or any Base Rate Loan, that all,
or any portion in an aggregate minimum amount of $500,000, and greater integral
multiples of $500,000, of any Loans be, in the case of Base Rate Loans,
converted into LIBO Rate Loans or, in the case of LIBO Rate Loans, be continued
as a LIBO Rate Loan, and (b) on or before the last day of the then current
Interest Period with respect to a LIBO Rate Loan that such Loan be converted
into a Base Rate Loan (in the absence of delivery of a Continuation/Conversion
Notice with respect to any LIBO Rate Loan at least three Business Days before
the last day of the then current Interest Period with respect thereto, such LIBO
Rate Loan shall, on such last day, automatically convert to a Base Rate Loan);
PROVIDED, HOWEVER, that (x) each such conversion or continuation shall be pro
rated among the applicable outstanding Loans of all Lenders, and (y) no portion
of the outstanding principal amount of any Loans may be continued as, or be
converted into, LIBO Rate Loans when any Default has occurred and is continuing.
SECTION 2.5 NOTES.
(a) The Loans made by, and the Borrower's Reimbursement
Obligations to, each Lender shall be evidenced by one or more accounts or
records maintained by such Lender and by the Administrative Agent in the
ordinary course of business. The accounts or records maintained by the
Administrative Agent and each Lender shall be conclusive absent manifest error.
Any failure so to record or any error in doing so shall not, however, limit or
otherwise affect the obligation of the Borrower hereunder to pay any amount
owing with respect to the Loans and Letters of Credit. In addition to such
accounts or records, each Lender's Revolving Loans may be evidenced by a
Revolving Note substantially in the form of Exhibit A-1 hereto, and each
Lender's Term Loan may be evidenced by a Term Loan Note substantially in the
form of Exhibit A-2 hereto. Each Lender may attach schedules to its Note(s) and
endorse thereon the date, amount and maturity of the applicable Loans and
payments with respect thereto.
28
(b) In addition to the accounts and records referred to
in subsection (a), each Lender and the Administrative Agent shall maintain in
accordance with its usual practice accounts or records evidencing the purchases
and sales by such Lender of participations in Letters of Credit. In the event of
any conflict between the accounts and records maintained by the Administrative
Agent and the accounts and records of any Lender in respect of such matters, the
accounts and records of the Administrative Agent shall control.
SECTION 2.6 LETTERS OF CREDIT.
SECTION 2.6.1 ISSUANCE REQUESTS. By delivering to the Administrative
Agent and the applicable Issuer an Issuance Request on or before 11:30 a.m.,
Central time, the Borrower may request, from time to time prior to the
Commitment Termination Date and on not less than three nor more than ten
Business Days' notice, that such Issuer issue an irrevocable standby letter of
credit in such form as may be mutually agreed to by the Borrower and such Issuer
(each a "LETTER OF CREDIT"), in support of financial and performance obligations
of the Borrower incurred in the Borrower's ordinary course of business and which
are described in such Issuance Request. Upon receipt of an Issuance Request, the
Administrative Agent shall promptly notify the Lenders thereof. Each Letter of
Credit shall by its terms: (a) be issued in a Stated Amount, which (i) together
with all Letter of Credit Outstandings, does not exceed the Letter of Credit
Sublimit, or (ii) together with all Letter of Credit Outstandings and all
outstanding Loans, does not exceed (or would not exceed) the Revolving Loan
Commitment Amount as of such date (as such amount is reduced and is scheduled to
reduce prior to the Stated Expiry Date pursuant to SECTION 2.2); and (b) be
stated to expire on a date (its "STATED EXPIRY DATE") no later than the earlier
of (i) one year from its date of issuance and (ii) the Commitment Termination
Date. So long as no Default has occurred and is continuing, by delivery to the
applicable Issuer and the Administrative Agent of an Issuance Request at least
three but not more than ten Business Days prior to the Stated Expiry Date of any
Letter of Credit, the Borrower may request such Issuer to extend the Stated
Expiry Date of such Letter of Credit for an additional period not to exceed the
earlier of one year from its date of extension and the Revolving Loan Commitment
Termination Date.
SECTION 2.6.2 ISSUANCES AND EXTENSIONS. On the terms and subject to the
conditions of this Agreement (including ARTICLE V), the Issuer shall issue
Letters of Credit, and extend the Stated Expiry Dates of outstanding Letters of
Credit, in accordance with the Issuance Requests made therefor. Each Issuer will
make available the original of each Letter of Credit which it issues in
accordance with the Issuance Request therefor to the beneficiary thereof (and
will promptly provide each of the Lenders and the Borrower with a copy of such
Letter of Credit) and will notify the beneficiary under any Letter of Credit of
any extension of the Stated Expiry Date thereof.
SECTION 2.6.3 [INTENTIONALLY LEFT BLANK].
29
SECTION 2.6.4 OTHER LENDERS' PARTICIPATION. Each Letter of Credit
issued pursuant to SECTION 2.6.2 shall, effective upon its issuance and without
further action, be issued on behalf of all Lenders (including the Issuer
thereof) PRO RATA according to their respective Percentages. Each Lender shall,
to the extent of its Percentage, be deemed irrevocably to have participated in
the issuance of such Letter of Credit and shall be responsible to reimburse
promptly the Issuer thereof for Reimbursement Obligations which have not been
reimbursed by the Borrower in accordance with SECTION 2.6.5, or which have been
reimbursed by the Borrower but must be returned, restored or disgorged by such
Issuer for any reason, and each Lender shall, to the extent of its Percentage,
be entitled to receive from the Administrative Agent a ratable portion of the
letter of credit fees received by the Administrative Agent pursuant to SECTION
3.3.3, with respect to each Letter of Credit. In the event that the Borrower
shall fail to reimburse any Issuer, or if for any reason Loans shall not be made
to fund any Reimbursement Obligation, all as provided in SECTION 2.6.5 and in an
amount equal to the amount of any drawing honored by such Issuer under a Letter
of Credit issued by it, or in the event such Issuer must for any reason return
or disgorge such reimbursement, such Issuer shall promptly notify each Lender of
the unreimbursed amount of such drawing and of such Lender's respective
participation therein. Each Lender shall make available to such Issuer, whether
or not any Default shall have occurred and be continuing, an amount equal to its
respective participation in same day or immediately available funds at the
office of such Issuer specified in such notice not later than 11:30 a.m.,
Central time, on the Business Day (under the laws of the jurisdiction of such
Issuer) after the date notified by such Issuer. In the event that any Lender
fails to make available to such Issuer the amount of such Lender's participation
in such Letter of Credit as provided herein, such Issuer shall be entitled to
recover such amount on demand from such Lender together with interest at the
daily average Federal Funds Rate for three Business Days (together with such
other compensatory amounts as may be required to be paid by such Lender to the
Administrative Agent pursuant to the Rules for Interbank Compensation of the
council on International Banking or the Clearinghouse Compensation Committee, as
the case may be, as in effect from time to time) and thereafter at the Alternate
Base Rate PLUS 2%. Nothing in this Section shall be deemed to prejudice the
right of any Lender to recover from any Issuer any amounts made available by
such Lender to such Issuer pursuant to this Section in the event that it is
determined by a court of competent jurisdiction that the payment with respect to
a Letter of Credit by such Issuer in respect of which payment was made by such
Lender constituted gross negligence or wilful misconduct on the part of such
Issuer. Each Issuer shall distribute to each other Lender which has paid all
amounts payable by it under this Section with respect to any Letter of Credit
issued by such Issuer such other Lender's Percentage of all payments received by
such Issuer from the Borrower in reimbursement of drawings honored by such
Issuer under such Letter of Credit when such payments are received.
SECTION 2.6.5 DISBURSEMENTS. Each Issuer will notify the Borrower and
the Administrative Agent promptly of the presentment for payment of any Letter
of Credit, together with notice of the date (the "DISBURSEMENT DATE") such
payment shall be made. Subject to the terms and provisions of such Letter of
Credit, the applicable Issuer shall make such payment to the beneficiary (or its
designee) of such Letter of Credit. Prior to 11:30 a.m., Central time, on the
Disbursement Date, the Borrower will reimburse the applicable Issuer for all
amounts which it has disbursed under
30
the Letter of Credit. In the event the applicable Issuer is not reimbursed by
the Borrower on the Disbursement Date, or if such Issuer must for any reason
return or disgorge such reimbursement, the Lenders (including such Issuer)
shall, on the terms and subject to the conditions of this Agreement, fund the
Reimbursement Obligation therefor by making, on the next Business Day, Loans
which are Base Rate Loans as provided in SECTION 2.3 (the Borrower being deemed
to have given a timely Borrowing Request therefor for such amount); PROVIDED,
HOWEVER, that for the purpose of determining the availability of the Commitments
to make Loans immediately prior to giving effect to the application of the
proceeds of such Loans, such Reimbursement Obligation shall be deemed not to be
outstanding at such time. To the extent the applicable Issuer is not reimbursed
in full in accordance with the preceding sentences, the Borrower's Reimbursement
Obligation shall accrue interest at a fluctuating rate equal to the Alternate
Base Rate, PLUS the Applicable Margin PLUS a margin of 2% per annum, payable on
demand.
SECTION 2.6.6 REIMBURSEMENT. The Borrower's obligation (a
"REIMBURSEMENT OBLIGATION") under SECTION 2.6.5 to reimburse an Issuer with
respect to each Disbursement (including interest thereon), and each Lender's
obligation to make participation payments in each drawing which has not been
reimbursed by the Borrower, shall be absolute and unconditional under any and
all circumstances and irrespective of any setoff, counterclaim, or defense to
payment which the Borrower may have or have had against any Lender or any
beneficiary of a Letter of Credit, including any defense based upon the
occurrence of any Default, any draft, demand or certificate or other document
presented under a Letter of Credit proving to be forged, fraudulent, invalid or
insufficient, the failure of any disbursement to conform to the terms of the
applicable Letter of Credit (if, in the applicable Issuer's good faith opinion,
such disbursement is determined to be appropriate) or any non-application or
misapplication by the beneficiary of the proceeds of such disbursement, or the
legality, validity, form, regularity, or enforceability of such Letter of
Credit; PROVIDED, HOWEVER, that nothing herein shall adversely affect the right
of the Borrower or any Lender to commence any proceeding against the applicable
Issuer for any wrongful disbursement made by such Issuer under a Letter of
Credit as a result of acts or omissions constituting gross negligence or wilful
misconduct on the part of such Issuer.
SECTION 2.6.7 DEEMED DISBURSEMENTS. Upon either (a) the occurrence and
during the continuation of an Event of Default pursuant to SECTION 8.1.9 or the
occurrence of the Commitment Termination Date, or (b) the declaration by the
Administrative Agent of all or any portion of the outstanding principal amount
of the Loans and other Obligations to be due and payable and/or the Commitments
(if not theretofore terminated) to be terminated as provided in SECTION 8.3, an
amount equal to that portion of Letter of Credit Outstandings attributable to
outstanding and undrawn Letters of Credit shall, at the election of the
applicable Issuer acting on instructions from the Required Lenders, and without
demand upon or notice to the Borrower, be deemed to have been paid or disbursed
by such Issuer under such Letters of Credit (notwithstanding that such amount
may not in fact have been so paid or disbursed), and, upon notification by such
Issuer to the Administrative Agent and the Borrower of its obligations under
this Section, the Borrower shall be immediately obligated to reimburse such
Issuer the amount deemed to have been so paid or disbursed by such
31
Issuer. Any amounts so received by such Issuer from the Borrower pursuant to
this Section shall be held as collateral security for the repayment of the
Borrower's obligations in connection with the Letters of Credit issued by such
Issuer. All amounts on deposit pursuant to this SECTION 2.6.7 shall, until their
application to any Obligation or their return to the Borrower, as the case may
be, at the Borrower's written request, be invested in high grade short-term
liquid investments acceptable to Administrative Agent and designated by the
Borrower, which investments shall be held by the Administrative Agent as
additional collateral security for the repayment of the Borrower's Obligations
under and in connection with the Letters of Credit and all other Obligations.
Any losses, net of earnings, and reasonable fees and expenses of such
investments shall be charged against the principal amount invested. The
Administrative Agent and the Lenders shall not be liable for any loss resulting
from any investment made by the Administrative Agent at the Borrower's request.
The Administrative Agent is not obligated hereby, or by any other Loan Document,
to make or maintain any investment, except upon written request by the Borrower.
At any time when such Letters of Credit shall terminate and all Obligations to
each Issuer are either terminated or paid or reimbursed to such Issuer in full,
the Obligations of the Borrower under this Section shall be reduced accordingly
(subject, however, to reinstatement in the event any payment in respect of such
Letters of Credit is recovered in any manner from such Issuer), and such Issuer
will return to the Borrower the excess, if any, of (x) the aggregate amount held
by such Issuer and not theretofore applied by such Issuer to any Reimbursement
Obligation OVER (y) the aggregate amount of all Reimbursement Obligations to
such Issuer pursuant to this Section, as so adjusted. At such time when all
Events of Default shall have been cured or waived, if the Revolving Loan
Commitment Termination Date shall not have occurred for any reason, each Issuer
shall return to the Borrower all amounts then on deposit with such Issuer
pursuant to this Section.
SECTION 2.6.8 NATURE OF REIMBURSEMENT OBLIGATIONS. The Borrower shall
assume all risks of the acts, omissions, or misuse of any Letter of Credit by
the beneficiary thereof. Neither any Issuer nor any Lender (except to the extent
of its own gross negligence or wilful misconduct) shall be responsible for: (a)
the form, validity, sufficiency, accuracy, genuineness, or legal effect of any
Letter of Credit or any document submitted by any party in connection with the
application for and issuance of a Letter of Credit, even if it should in fact
prove to be in any or all respects invalid, insufficient, inaccurate,
fraudulent, or forged; (b) the form, validity, sufficiency, accuracy,
genuineness, or legal effect of any instrument transferring or assigning or
purporting to transfer or assign a Letter of Credit or the rights or benefits
thereunder or proceeds thereof in whole or in part, which may prove to be
invalid or ineffective for any reason; (c) failure of the beneficiary to comply
fully with conditions required in order to demand payment under a Letter of
Credit; (d) errors, omissions, interruptions, or delays in transmission or
delivery of any messages, by mail, cable, telegraph, telex, facsimile or
otherwise; or (e) any loss or delay in the transmission or otherwise of any
document or draft required in order to make a Disbursement under a Letter of
Credit or of the proceeds thereof. None of the foregoing shall affect, impair,
or prevent the vesting of any of the rights or powers granted any Issuer or any
Lender hereunder. In furtherance and extension, and not in limitation or
derogation, of any of the foregoing, any action taken or omitted to be taken by
any
32
Issuer in good faith shall be binding upon the Borrower and shall not put such
Issuer under any resulting liability to the Borrower.
SECTION 2.6.9 INCREASED COSTS; INDEMNITY. If by reason of (a) any
change in applicable law, regulation, rule, decree or regulatory requirement or
any change in the interpretation or application by any judicial or regulatory
authority of any law, regulation, rule, decree or regulatory requirement, or (b)
compliance by any Issuer or any Lender with any direction, or requirement of any
governmental or monetary authority, including Regulation D of the F.R.S. Board:
(i) any Issuer or any Lender shall be subject to any tax (other than taxes on
net income and franchises), levy, charge or withholding of any nature or to any
variation thereof or to any penalty with respect to the maintenance or
fulfillment of its obligations under this SECTION 2.6, whether directly or by
such being imposed on or suffered by such Issuer or such Lender; (ii) any
reserve, deposit or similar requirement is or shall be applicable, increased,
imposed or modified in respect of any Letters of Credit issued by any Issuer or
participations therein purchased by any Lender; or (iii) there shall be imposed
on any Issuer or any Lender any other condition regarding this SECTION 2.6, any
Letter of Credit or any participation therein, and the result of the foregoing
is directly to increase the cost to such Issuer or such Lender of issuing or
maintaining any Letter of Credit or of purchasing or maintaining any
participation therein, or to reduce any amount receivable in respect thereof by
such Issuer or such Lender, then and in any such case such Issuer or such Lender
may, at any time after the additional cost is incurred or the amount received is
reduced, notify the Administrative Agent and the Borrower thereof, and the
Borrower shall pay within 10 days of demand such amounts as such Issuer or
Lender may in good faith specify to be necessary to compensate such Issuer or
Lender for such additional cost or reduced receipt, together with interest on
such amount from the date demanded until payment in full thereof at a rate equal
at all times to the Alternate Base Rate PLUS the Applicable Margin per annum.
The determination by such Issuer or Lender, as the case may be, of any amount
due pursuant to this Section, as set forth in a statement setting forth the
calculation thereof in reasonable detail, shall be rebuttable presumptive
evidence of such amounts.
In addition to amounts payable as elsewhere provided in this SECTION
2.6, the Borrower hereby indemnifies, exonerates and holds each Issuer, the
Administrative Agent and each Lender harmless from and against any and all
actions, causes of action, suits, losses, costs, liabilities and damages, and
expenses incurred in connection therewith (irrespective of whether such Issuer,
the Administrative Agent or such Lender is a party to the action for which
indemnification is sought), including reasonable attorneys' fees and
disbursements, which such Issuer, the Administrative Agent or such Lender may
incur or be subject to as a consequence, direct or indirect, of the issuance of
the Letters of Credit, other than as a result of the gross negligence or wilful
misconduct of such Issuer as determined by a court of competent jurisdiction, or
the failure of such Issuer to honor a drawing under any Letter of Credit as a
result of any act or omission, whether rightful or wrongful, of any present or
future de jure or de facto government or governmental authority.
33
ARTICLE III
REPAYMENTS, PREPAYMENTS, INTEREST AND FEES
SECTION 3.1 REPAYMENTS AND PREPAYMENTS. (a) The Borrower shall repay in
full the unpaid principal amount of each Loan upon the Stated Maturity Date
therefor. Each prepayment of any Loans made pursuant to this Section shall be
without premium or penalty, except as may be required by SECTION 4.4. No
voluntary prepayment of principal of any Revolving Loan shall cause a reduction
in the Revolving Loan Commitment Amount, except as provided in SECTION 2.2.1.
(b) THE TERM LOANS. The Borrower shall repay the
principal of and interest on the Term Loans as follows: the Borrower shall make
principal payments on each date set forth below (each, a "PRINCIPAL PAYMENT
DATE"), in an amount equal to the dollar amount set forth below opposite such
date. Each principal payment made on a Principal Payment Date shall be made
together with accrued and unpaid interest thereon.
34
======================================================================
Principal Payment Date Amount of Payment
----------------------------------------------------------------------
March 31, 2002 $ 2,800,000
----------------------------------------------------------------------
June 30, 2002 $ 2,800,000
----------------------------------------------------------------------
September 30, 2002 $ 4,112,500
----------------------------------------------------------------------
December 31, 2002 $ 4,562,500
----------------------------------------------------------------------
March 31, 2003 $ 4,562,500
----------------------------------------------------------------------
June 30, 2003 $ 4,562,500
----------------------------------------------------------------------
September 30, 2003 $ 4,562,500
----------------------------------------------------------------------
December 31, 2003 $ 1,504,700
----------------------------------------------------------------------
March 31, 2004 $ 1,504,700
----------------------------------------------------------------------
June 30, 2004 $ 1,504,700
----------------------------------------------------------------------
September 30, 2004 $ 1,504,700
----------------------------------------------------------------------
December 31, 2004 $ 1,504,700
----------------------------------------------------------------------
March 31, 2005 $ 1,504,700
----------------------------------------------------------------------
June 30, 2005 $ 1,504,700
----------------------------------------------------------------------
August 9, 2005 The remaining principal
balance of the Term Loan
----------------------------------------------------------------------
Total: $40,000,000
======================================================================
SECTION 3.1.1 OPTIONAL PREPAYMENT. At any time prior to the Stated
Maturity Date, the Borrower may, from time to time on any Business Day, make a
voluntary prepayment, in whole or in part, of the outstanding principal amount
of any Loans; PROVIDED, HOWEVER, that (a) any such prepayment shall be made PRO
RATA among Loans of the same type and, if applicable, having the same Interest
Period of all Lenders, (b) no such prepayment of any LIBO Rate Loan may be made
on any day other than the last day of the Interest Period for such Loan, (c) all
such voluntary prepayments (i) of LIBO Rate Loans shall require at least three
(3) Business Days' prior written notice to the Administrative Agent, and (ii) of
Base Rate Loans shall require prior written notice on the date of prepayment to
the Administrative Agent, and (d) all such voluntary partial prepayments shall
be in a minimum amount of $500,000, and greater integral multiples of $500,000.
35
SECTION 3.1.2 MANDATORY PREPAYMENT. On each date when any reduction in
the Revolving Loan Commitment Amount shall become effective, including pursuant
to SECTION 2.2, if the then aggregate outstanding principal amount of all
Revolving Loans together with Letter of Credit Outstandings exceeds the
Revolving Loan Commitment Amount as so reduced, the Borrower shall make a
mandatory prepayment of Revolving Loans equal to such excess, and if any such
excess remains after such prepayment, to the extent of such excess the Borrower
shall immediately Cash Collateralize the Reimbursement Obligations in an amount
equal to the aggregate Stated Amount of all Letters of Credit outstanding and
undrawn.
SECTION 3.1.3 MANDATORY PREPAYMENT ON ACCELERATION. The Borrower shall,
immediately upon any acceleration of the Stated Maturity Date of any Loans
pursuant to SECTION 8.2 or SECTION 8.3, repay all Loans, unless, pursuant to
SECTION 8.3, only a portion of all Loans is so accelerated.
SECTION 3.1.4 PREPAYMENTS OF TERM LOANS. All prepayments of the Term
Loans made on or before September 30, 2003 will be applied FIRST to reduce pro
rata the amount of the remaining installments through September 30, 2003, and
SECOND, to reduce pro rata the amount of the remaining installments through June
30, 2005. Prepayments made after September 30, 2003 will be applied to reduce
pro rata the amount of the remaining installments.
SECTION 3.2 INTEREST PROVISIONS. Interest on the outstanding principal
amount of Loans shall accrue and be payable in accordance with this SECTION 3.2.
SECTION 3.2.1 RATES. Pursuant to an appropriately delivered Borrowing
Request or Continuation/Conversion Notice, the Borrower may elect that Loans
comprising a Borrowing accrue interest at a rate per annum: (a) on that portion
maintained from time to time as a Base Rate Loan, equal to the Alternate Base
Rate PLUS the Applicable Margin from time to time in effect; and (b) on that
portion maintained as a LIBO Rate Loan, during each Interest Period applicable
thereto, equal to the sum of the LIBO Rate (Reserve Adjusted) for such Interest
Period PLUS the Applicable Margin.
All LIBO Rate Loans shall bear interest from and including the
first day of the applicable Interest Period to (but not including) the last day
of such Interest Period at the interest rate determined as applicable to such
LIBO Rate Loan.
SECTION 3.2.2 DEFAULT RATE. While any Event of Default exists or after
acceleration, the Borrower shall pay upon demand interest (after as well as
before judgment) on the principal amount of all outstanding Obligations at a
fluctuating rate per annum equal to the Alternate Base Rate PLUS the Applicable
Margin PLUS 2%; PROVIDED, HOWEVER, that with respect to a LIBO Rate Loan, the
Default Rate shall be an interest rate equal to the interest rate (including any
Applicable Margin) otherwise applicable to such Loan PLUS 2% per annum, but in
any event not to exceed the maximum rate permitted by applicable law.
36
SECTION 3.2.3 PAYMENT DATES. Interest accrued on each Loan shall be
payable, without duplication: (a) on the Stated Maturity Date therefor; (b) on
the date of any payment or prepayment, in whole or in part, of principal
outstanding on such Loan; (c) with respect to Base Rate Loans, on each Quarterly
Payment Date occurring after the Effective Date; (d) with respect to LIBO Rate
Loans, the last day of each applicable Interest Period (and, if such Interest
Period shall exceed 90 days, on the 90th day of such Interest Period); (e) with
respect to any Base Rate Loans converted into LIBO Rate Loans; on a day when
interest would not otherwise have been payable pursuant to CLAUSE (c), on the
date of such conversion; and (f) on that portion of any Loans the Stated
Maturity Date of which is accelerated pursuant to SECTION 8.2 or SECTION 8.3,
immediately upon such acceleration. Interest accrued on Loans or other monetary
Obligations arising under this Agreement or any other Loan Document after the
date such amount is due and payable (whether on the Stated Maturity Date, upon
acceleration or otherwise) shall be payable upon demand.
SECTION 3.3 FEES. The Borrower agrees to pay the fees set forth in this
SECTION 3.3. All such fees shall be non-refundable.
SECTION 3.3.1 COMMITMENT FEE. The Borrower agrees to pay to the
Administrative Agent for the account of each Lender, for the period (including
any portion thereof when any of its Commitments are suspended by reason of the
Borrower's inability to satisfy any condition of ARTICLE V) commencing on the
Effective Date and continuing through the final Commitment Termination Date, a
Commitment Fee on such Lender's Percentage of the sum of the average daily
unused portion of the Commitment Amount (outstanding Loans and Letters of Credit
being deemed to be usage hereunder). Such Commitment Fee shall be payable by the
Borrower in arrears, on each Quarterly Payment Date, commencing with the first
such day following the Effective Date, and on each Commitment Termination Date.
SECTION 3.3.2 ADMINISTRATIVE AGENT'S FEE. The Borrower agrees to pay
the fees provided in the fee letter dated August 10, 2001 between the Borrower,
the Administrative Agent and Banc of America Securities LLC.
SECTION 3.3.3 LETTER OF CREDIT FEES. (a) The Borrower agrees to pay to
the Administrative Agent, for the account of each Lender, a fee for each Letter
of Credit for the period from and including the date of the issuance of such
Letter of Credit to (but not including) the date upon which such Letter of
Credit expires, at a per annum rate equal to the Applicable Margin on the
outstanding face amount of each Letter of Credit. Such fee shall be payable by
the Borrower in arrears on each Quarterly Payment Date, and on the Commitment
Termination Date for any period then ending for which such fee shall not
theretofore have been paid, commencing on the first such date after the issuance
of such Letter of Credit.
(b) The Borrower agrees to pay to the Administrative Agent,
for the account of the Issuer, (i) a Letter of Credit fronting fee for each
Letter of Credit upon the issuance of each Letter
37
of Credit in an amount equal to the greater of (A) $500 or (B) one-eight of one
percent (1/8 of 1%) calculated on the face amount thereof, and (ii) such
Issuer's standard drawing fees and other processing fees upon any drawing under
such Letter of Credit.
ARTICLE IV
CERTAIN LIBO RATE AND OTHER PROVISIONS
SECTION 4.1 FIXED RATE LENDING UNLAWFUL. If any Lender shall determine
(which determination shall, upon notice thereof to the Borrower and the Lenders,
be conclusive and binding on the Borrower) that the introduction of or any
change in or in the interpretation of any law makes it unlawful, or any central
bank or other governmental authority asserts that it is unlawful, for such
Lender to make, continue or maintain any Loan as, or to convert any Loan into, a
LIBO Rate Loan of a certain type, the obligations of all Lenders to make,
continue, maintain or convert any such Loans shall, upon such determination,
forthwith be suspended until such Lender shall notify the Administrative Agent
that the circumstances causing such suspension no longer exist, and all LIBO
Rate Loans of such type shall automatically convert into Base Rate Loans at the
end of the then current Interest Periods with respect thereto or sooner, if
required by such law or assertion.
SECTION 4.2 DEPOSITS UNAVAILABLE. If the Administrative Agent shall
have determined that (a) Dollar deposits in the relevant amount and for the
relevant Interest Period are not available to the Lenders in their relevant
markets; or (b) by reason of circumstances affecting BofA's relevant market,
adequate means do not exist for ascertaining the interest rate applicable
hereunder to LIBO Rate Loans, then, upon notice from the Administrative Agent to
the Borrower and the Lenders, the obligations of all Lenders under SECTION 2.3
and SECTION 2.4 to make or continue any Loans as, or to convert any Loans into,
LIBO Rate Loans shall forthwith be suspended until the Administrative Agent
shall notify the Borrower and the Lenders that the circumstances causing such
suspension no longer exist.
SECTION 4.3 INCREASED LIBO RATE LOAN COSTS, ETC. The Borrower agrees to
reimburse each Lender for any increase in the cost to such Lender of, or any
reduction in the amount of any sum receivable by such Lender in respect of,
making, continuing or maintaining (or of its obligation to make, continue or
maintain) any Loans as, or of converting (or of its obligation to convert) any
Loans into, LIBO Rate Loans. Such Lender shall promptly notify the
Administrative Agent and the Borrower in writing of the occurrence of any such
event, such notice to state, in reasonable detail, the reasons therefor and the
additional amount required fully to compensate such Lender for such increased
cost or reduced amount; PROVIDED, THAT no Lender shall give such notice unless
it is generally charging borrowers similarly situated to the Borrower with
similar agreements with such Lender such amounts. Such additional amounts shall
be payable by the Borrower directly to such Lender within five days of its
receipt of such notice, and such notice shall be rebuttable presumptive evidence
of such amounts.
38
SECTION 4.4 FUNDING LOSSES. In the event any Lender shall incur any
loss, cost or expense as a result of (a) any conversion or repayment or
prepayment of the principal amount of any LIBO Rate Loans on a date other than
the scheduled last day of the Interest Period applicable thereto, whether
pursuant to SECTION 3.1 or otherwise; (b) any Loans not being made as LIBO Rate
Loans in accordance with the Borrowing Request therefor; or (c) any Loans not
being continued as, or converted into, LIBO Rate Loans in accordance with the
Continuation/ Conversion Notice therefor, then, upon the written notice of such
Lender to the Borrower (with a copy to the Administrative Agent), the Borrower
shall, within five days of its receipt thereof, pay directly to such Lender such
amount as will (in the reasonable determination of such Lender) reimburse such
Lender for such loss, cost or expense. Such written notice (which shall include
calculations in reasonable detail) and shall be rebuttable presumptive evidence
of such amounts. The amounts calculated pursuant to this SECTION 4.4 shall
include any loss, cost or expense incurred by reason of the liquidation or
reemployment of deposits or other funds acquired by such Lender to make,
continue or maintain any portion of the principal amount of any Loan as, or to
convert any portion of the principal amount of any Loan into, a LIBO Rate Loan.
SECTION 4.5 INCREASED CAPITAL COSTS. If any change in, or the
introduction, adoption, effectiveness, interpretation, reinterpretation or
phase-in of, any law or regulation, directive, guideline, decision or request of
any court, central bank, regulator or other governmental authority affects or
would affect the amount of capital required or expected to be maintained by any
Lender or any Person controlling such Lender, and such Lender determines (in its
discretion exercised in good faith) that the rate of return on its or such
controlling Person's capital as a consequence of its Commitments or the Loans
made by such Lender is reduced to a level below that which such Lender or such
controlling Person could have achieved but for the occurrence of any such
circumstance, then, in any such case upon notice from time to time by such
Lender to the Borrower, the Borrower shall immediately pay directly to such
Lender additional amounts sufficient to compensate such Lender or such
controlling Person for such reduction in rate of return. A statement of such
Lender as to any such additional amount or amounts shall be furnished to
Borrower including calculations thereof in reasonable detail and shall be
rebuttable presumptive evidence of such amounts. In determining such amount,
such Lender may use any method of averaging and attribution that it (in its
discretion exercised in good faith) shall deem applicable.
SECTION 4.6 TAXES. All payments by the Borrower of principal of, and
interest on, the Loans, all payments in respect of the Reimbursement Obligations
and all other amounts payable hereunder shall be made free and clear of and
without deduction for any present or future excise, stamp or franchise taxes and
other taxes, fees, duties, withholdings or other charges of any nature
whatsoever imposed by any taxing authority, but excluding franchise taxes and
taxes imposed on or measured by any Lender's net income or receipts by the
jurisdiction (or any political subdivision thereof) under the laws of which such
Lender is organized or maintains an office from which Loans are funded (such
non-excluded items being called "TAXES"). In the event that any withholding or
deduction from any payment to be made by the Borrower hereunder is required in
respect of any Taxes pursuant to any applicable law, rule or regulation, then
the Borrower will (a) pay directly to
39
the relevant authority the full amount required to be so withheld or deducted;
(b) promptly forward to the Administrative Agent an official receipt or other
documentation satisfactory to the Administrative Agent evidencing such payment
to such authority; and (c) pay to the Administrative Agent for the account of
the Lenders such additional amount or amounts as is necessary to ensure that the
net amount actually received by each Lender will equal the full amount such
Lender would have received had no such withholding or deduction been required.
Moreover, if any Taxes are directly asserted against the Administrative Agent or
any Lender with respect to any payment received by the Administrative Agent or
such Lender hereunder, the Administrative Agent or such Lender may pay such
Taxes and the Borrower will promptly pay such additional amounts (including, if
incurred as a result of the Borrower's action, omission or delay, any penalties,
interest or expenses) as is necessary in order that the net amount received by
such person after the payment of such Taxes (including any Taxes on such
additional amount) shall equal the amount such person would have received had
not such Taxes been asserted.
If the Borrower fails to pay any Taxes when due to the
appropriate taxing authority or fails to remit to the Administrative Agent, for
the account of the respective Lenders, the required receipts or other required
documentary evidence, the Borrower shall indemnify the Lenders for any
incremental Taxes, interest or penalties that may become payable by any Lender
as a result of any failure of Borrower to pay the taxing authorities directly
where required. For purposes of this SECTION 4.6, a distribution hereunder by
the Administrative Agent or any Lender to or for the account of any Lender shall
be deemed a payment by the Borrower.
Each Lender that is organized under the laws of a jurisdiction
other than the United States shall, prior to the due date of any payments under
the Notes, execute and deliver to the Borrower and the Administrative Agent, on
or about the first scheduled payment date in each Fiscal Year, one or more (as
the Borrower or the Administrative Agent may reasonably request) United States
Internal Revenue Service Forms 4224 or Forms 1001 or such other forms or
documents (or successor forms or documents), appropriately completed, as may be
applicable to establish the extent, if any, to which a payment to such Lender is
exempt from withholding or deduction of Taxes.
SECTION 4.7 PAYMENTS, COMPUTATIONS, ETC. Unless otherwise expressly
provided, all payments by the Borrower pursuant to this Agreement, the Notes or
any other Loan Document shall be made by the Borrower to the Administrative
Agent for the PRO RATA account of the Lenders entitled to receive such payment.
All such payments required to be made to the Administrative Agent shall be made,
without setoff, deduction or counterclaim, not later than 11:00 a.m., Central
time, on the date due, in same day or immediately available funds, to such
account as the Administrative Agent shall specify from time to time by notice to
the Borrower. Funds received after that time shall be deemed to have been
received by the Administrative Agent on the next succeeding Business Day. The
Administrative Agent shall promptly remit in same day funds to each Lender its
share, if any, of such payments received by the Administrative Agent for the
account of such Lender. All interest and fees shall be computed on the basis of
the actual number of days (including the first day but excluding the last day)
occurring during the period for which such interest or fee is payable over a
40
year comprised of 360 days (or, in the case of interest on a Base Rate Loan, 365
days or, if appropriate, 366 days). Whenever any payment to be made shall
otherwise be due on a day which is not a Business Day, such payment shall
(except as otherwise required by CLAUSE (c) of the definition of the term
"INTEREST PERIOD" with respect to LIBO Rate Loans) be made on the next
succeeding Business Day and such extension of time shall be included in
computing interest and fees, if any, in connection with such payment.
SECTION 4.8 SHARING OF PAYMENTS. If any Lender shall obtain any payment
or other recovery (whether voluntary, involuntary, by application of setoff or
otherwise) on account of any Loan, any Reimbursement Obligation or any other
Obligation (other than pursuant to the terms of SECTIONS 4.3, 4.4 and 4.5) in
excess of its PRO RATA share of payments then or therewith obtained by all
Lenders, such Lender shall purchase from the other Lenders such participations
as shall be necessary to cause such purchasing Lender to share the excess
payment or other recovery ratably with each of them; PROVIDED, HOWEVER, that if
all or any portion of the excess payment or other recovery is thereafter
recovered from such purchasing Lender, the purchase shall be rescinded and each
Lender which has sold a participation to the purchasing Lender shall repay to
the purchasing Lender the purchase price to the ratable extent of such recovery
together with an amount equal to such selling Lender's ratable share (according
to the proportion of (a) the amount of such selling Lender's required repayment
to the purchasing Lender (b) the total amount so recovered from the purchasing
Lender) of any interest or other amount paid or payable by the purchasing Lender
in respect of the total amount so recovered. The Borrower agrees that any Lender
so purchasing a participation from another Lender pursuant to this Section may,
to the fullest extent permitted by law, exercise all its rights of payment
(including pursuant to SECTION 4.9) with respect to such participation as fully
as if such Lender were the direct creditor of the Borrower in the amount of such
participation. If under any applicable bankruptcy, insolvency or other similar
law, any Lender receives a secured claim in lieu of a setoff to which this
Section applies, such Lender shall, to the extent practicable, exercise its
rights in respect of such secured claim in a manner consistent with the rights
of the Lenders entitled under this Section to share in the benefits of any
recovery on such secured claim.
SECTION 4.9 SETOFF. Upon the occurrence of an Event of Default, each
Lender shall be entitled to exercise (for the benefit of all Lenders pursuant to
SECTION 4.8) any right of offset or bankers' lien against each and every account
and other property or interest therein that the Borrower or any Obligor may now
or hereafter have with, or which is now or hereafter in the possession of, such
Lender, to the extent of the full amount of the Obligations. To secure the
Obligations, the Borrower hereby grants to each Lender a continuing security
interest in any and all balances, credits, deposits, accounts or moneys of the
Borrower then or thereafter maintained with such Lender; PROVIDED, HOWEVER, that
any exercise of such security interest shall be subject to the provisions of
SECTION 4.8. Each Lender agrees promptly to notify the Borrower and the
Administrative Agent after any such setoff and application made by such Lender;
PROVIDED, HOWEVER, that the failure to give such notice shall not affect the
validity of such setoff and application. The rights of each Lender under this
Section are in addition to other rights and remedies (including other rights of
setoff under applicable law or otherwise) which such Lender may have.
41
ARTICLE V
CONDITIONS TO BORROWING
SECTION 5.1 CONTINUATION OF EXISTING LOANS; INITIAL BORROWING. The
obligations of the Lenders to fund the initial Borrowing and to issue the
initial Letter of Credit shall be subject to the prior or concurrent
satisfaction of each of the conditions precedent set forth in this SECTION 5.1.
All certificates, agreements, opinions and other documents delivered shall be in
form and substance satisfactory to the Administrative Agent.
SECTION 5.1.1 RESOLUTIONS, ETC. The Administrative Agent shall have
received from each Obligor a certificate, dated the date of the initial
Borrowing or the issuance of the initial Letter of Credit or of such
continuation, of its secretary, assistant secretary, manager or general partner
as applicable as to (a) resolutions of its Board of Directors, Managers, or
their equivalent then in full force and effect authorizing the execution,
delivery and performance of this Agreement, the Notes and each other Loan
Document to be executed by it, (b) any amendments to the articles or certificate
of incorporation or organization for such Obligor, and the bylaws, operating
agreements, or partnership agreement of such Obligor, in each case as previously
delivered to the Administrative Agent pursuant to the Existing Credit Agreement,
and (c) the incumbency and signatures of those of its officers authorized to act
with respect to this Agreement, the Notes and each other Loan Document executed
by it, upon which certificate each Lender may conclusively rely until it shall
have received a further certificate of the secretary, manager or general partner
as applicable of such Obligor canceling or amending such prior certificate. The
Administrative Agent shall have received from each Obligor certificates of
existence and good standing provided by the appropriate governmental officer in
its jurisdiction of incorporation and, in the case of certificates of good
standing, in each jurisdiction in which its business is conducted.
SECTION 5.1.2 DELIVERY OF THIS AGREEMENT. The Administrative Agent
shall have received this Agreement and the Notes issued pursuant hereto.
SECTION 5.1.3 GUARANTY AGREEMENTS. The Administrative Agent shall have
received Second Amended and Restated Guaranty Agreements dated as of the date
hereof, duly executed by ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ and Matrex, and
shall have received an Amended and Restated Guaranty Agreement dated as of the
date hereof, duly executed by MarkWest Resources.
SECTION 5.1.4 COLLATERAL DOCUMENTS. The Administrative Agent shall have
received (a) executed counterparts of the Collateral Documents described on
Schedule II, together with commitments for title insurance described on Schedule
II, and (b) to the extent not previously delivered to Agent, certificates
evidencing all of the issued and outstanding shares of capital stock,
partnership interests, or membership interests pledged pursuant thereto, which
certificates shall in each case be accompanied by undated stock powers duly
executed in blank, or, if any securities pledged pursuant thereto are
uncertificated securities, confirmation and evidence satisfactory to the
42
Administrative Agent that the security interest in such uncertificated
securities has been transferred to and perfected by the Administrative Agent for
the benefit of the Lenders in accordance with the Uniform Commercial Code.
SECTION 5.1.5 INTERCREDITOR AGREEMENT. Administrative Agent shall have
received executed counterparts of the Intercreditor Agreement.
SECTION 5.1.6 REPAYMENT OF LOANS UNDER "REVOLVING FACILITY B" OF THE
EXISTING CREDIT AGREEMENT. On the Effective Date, the Borrower shall repay the
Existing Loans under "Revolving Facility B" of the Existing Credit Agreement.
SECTION 5.1.7 CLOSING OF THE CANADIAN FACILITY. The Administrative
Agent shall have received evidence that the "Effective Date" under the Canadian
Facility shall have occurred.
SECTION 5.1.8 CLOSING CERTIFICATE. The Administrative Agent shall have
received a certificate signed by an Authorized Officer certifying (a) that the
conditions specified in ARTICLE V have been satisfied, (b) no Default or Event
of Default exists, (c) except as set forth in ITEM 6.7 on SCHEDULE I hereto, no
default under any material contract or agreement exists, (d) no "Default" or
"Event of Default" under the Existing Credit Agreement exists, (e) except as set
forth in ITEM 6.7 on SCHEDULE I to this Agreement, no litigation or action
exists or is pending or threatened which could reasonably be expected to have a
Material Adverse Effect, and (f) since December 31, 2000, there has occurred no
event or circumstance which could reasonably be expected to have a Material
Adverse Effect.
SECTION 5.1.9 OPINIONS OF COUNSEL. The Administrative Agent shall have
received the following, each dated the Effective Date and addressed to the
Administrative Agent and all Lenders: (a) legal opinions from ▇▇▇▇▇, ▇▇▇▇▇▇ &
▇▇▇▇▇▇ LLP and from ▇▇▇▇▇ ▇▇▇▇▇▇▇, counsel to the Borrower and its Subsidiaries,
substantially in the form of EXHIBIT E-1 and EXHIBIT E-3 hereto, (b) a legal
opinion from ▇▇▇▇▇ ▇▇▇▇▇ LLP, Texas counsel to the Borrower and its
Subsidiaries, substantially in the form of EXHIBIT E-2 hereto, and (c) such
opinions of local counsel as the Administrative Agent shall require.
SECTION 5.1.10 CLOSING FEES, EXPENSES, ETC. All fees and expenses to be
paid on or before the Effective Date shall have been paid, including attorneys'
fees and expenses to the extent invoiced prior to the Effective Date.
SECTION 5.1.11 EVIDENCE OF INSURANCE. The Administrative Agent shall
have received certificates of insurance satisfactory to it evidencing the
existence of all insurance required to be maintained by the Borrower by this
Agreement and the other Loan Documents, which insurance shall list
Administrative Agent as additional insured and sole loss payee and be
satisfactory to the Administrative Agent.
43
SECTION 5.1.12 [INTENTIONALLY LEFT BLANK]
SECTION 5.1.13 TITLE. The Administrative Agent shall have received (a)
such title information as the Administrative Agent may require setting forth the
status of title acceptable to the Administrative Agent to at least 75% of the
value of the Borrower's and its Subsidiaries' Oil and Gas Properties included in
the Initial Reserve Reports, and (b) such title information as the
Administrative Agent may require setting forth the status of title acceptable to
the Administrative Agent to the Borrower's real estate and facilities.
SECTION 5.1.14 INITIAL RESERVE REPORT. The Administrative Agent shall
have received the Initial Reserve Reports in form and substance satisfactory to
the Lenders.
SECTION 5.1.15 ENVIRONMENTAL REPORTS. The Administrative Agent and the
Lenders shall have received environmental assessment reports relating to assets
of the Borrower and its Subsidiaries, and the Lenders shall be satisfied with
the reports.
SECTION 5.1.16 FINANCIAL STATEMENTS. The Administrative Agent shall
have received and, in each case, approved the following financial statements:
(i) With respect to the Borrower, audited
consolidated financial statements for the fiscal years ended
1998, 1999 and 2000, including balance sheets, income and cash
flow statements audited by independent public accountants of
recognized national standing and prepared in conformity with
GAAP, quarterly financial statements for the first two Fiscal
Quarters of 2001, interim monthly financial statements for the
months January 2001 through June 2001, monthly working capital
needs for 2001 and quarterly for 2002, and a budget for the
fiscal year 2001.
(ii) With respect to the Acquired Companies,
unaudited consolidated financial statements for the eight
months ended March 31, 2001 for the eight ▇▇▇▇▇▇-side
management holding companies including balance sheet, income
and cash flow statements; unaudited consolidated financial
statements for the nine months ended March 31, 2001 for ▇▇▇▇▇▇
Energy Canada Ltd. including balance sheet, income and cash
flow statements; and unaudited consolidated financial
statements for the eleven months ended June 30, 2001 for the
eight Watford-side management holding companies, including
balance sheet, income and cash flow statements.
(iii) Pro forma consolidated balance sheet of the
Borrower and its Subsidiaries as of June 30, 2001 after giving
effect to the Canadian Acquisition.
44
SECTION 5.1.17 INCENTIVE PAYMENTS AGREEMENT. The Administrative Agent
shall have received a copy of the Incentive Payments Agreement.
SECTION 5.1.18 OTHER. The Administrative Agent shall have received such
other assurances, certificates, documents, consents or opinions as the
Administrative Agent or the Required Lenders may require.
SECTION 5.2 ALL BORROWINGS. The obligation of each Lender to fund any
Loan on the occasion of any Borrowing (including the initial Borrowing) and to
issue any Letter of Credit (including the initial Letter of Credit) shall be
subject to the satisfaction of each of the conditions precedent set forth in
this SECTION 5.3.
SECTION 5.2.1 COMPLIANCE WITH WARRANTIES, NO DEFAULT, ETC. Both before
and after giving effect to any Borrowing or Letter of Credit (but, if any
Default of the nature referred to in SECTION 8.1.5 shall have occurred with
respect to any other Indebtedness, without giving effect to the application,
directly or indirectly, of the proceeds thereof) the following statements shall
be true and correct in all material respects (a) the representations and
warranties set forth in ARTICLE VI and in each Collateral Document shall be true
and correct with the same effect as if then made (unless stated to relate solely
to an earlier date, in which case such representations and warranties shall be
true and correct as of such earlier date); (b) except as disclosed by the
Borrower to the Administrative Agent and the Lenders pursuant to SECTION 6.7 (i)
no labor controversy, litigation, arbitration or governmental investigation or
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 materially adversely affect the Borrower's and its Subsidiaries'
consolidated business, operations, assets, revenues, properties or prospects or
which purports to affect the legality, validity or enforceability of this
Agreement, the Notes or any other Loan Document, and (ii) no development shall
have occurred in any labor controversy, litigation, arbitration, environmental
or governmental investigation or proceeding disclosed pursuant to SECTION 6.7
which could reasonably be expected to materially adversely affect the
consolidated businesses, operations, assets, revenues, properties or prospects
of the Borrower and its Subsidiaries; and (c) no Default shall have then
occurred and be continuing, and neither the Borrower, any other Obligor, nor any
of their Subsidiaries are in violation of any law or governmental regulation or
court order or decree, which would have a Material Adverse Effect.
SECTION 5.2.2 BORROWING REQUEST; COMPLIANCE CERTIFICATE. (a) The
Administrative Agent shall have received a Borrowing Request for such Borrowing
or Issuance Request for such Letter of Credit, as the case may be. Each of the
delivery of a Borrowing Request or Issuance Request for such Letter of Credit,
as the case may be, and the acceptance by the Borrower of the proceeds of such
Borrowing or such Letter of Credit shall constitute a representation and
warranty by the Borrower that on the date of such Borrowing (both immediately
before and after giving effect to such Borrowing and the application of the
proceeds thereof) the statements made in SECTION 5.3.1 are true and correct.
45
(b) In addition, if Borrower is unable to make the
representations and warranties set forth in paragraph 5 of the form of Borrowing
Request attached hereto as EXHIBIT B, then Borrower shall deliver to the
Administrative Agent, not less than ten (10) days prior to the date of requested
Borrowing or Issuance Request, a certificate (a "REGULATION U COMPLIANCE
CERTIFICATE") in form and substance satisfactory to the Administrative Agent
setting forth calculations demonstrating compliance with Regulation U and, if
required by the Administrative Agent, an opinion of counsel (a "REGULATION U
OPINION") in form and substance satisfactory to the Administrative Agent stating
that the Lenders and the Borrowers are, and after the requested Borrowing or
Issuance will be, in compliance with Regulation U.
SECTION 5.2.3 SATISFACTORY LEGAL FORM. All documents executed or
submitted pursuant hereto by or on behalf of the Borrower or any of its
Subsidiaries or any other Obligors shall be satisfactory in form and substance
to the Administrative Agent and its counsel (which satisfaction is acknowledged
with respect to any documents conforming to the respective exhibit attached
hereto); and the Administrative Agent and its counsel shall have received all
information, approvals, opinions, documents or instruments as the Administrative
Agent or its counsel may reasonably request.
ARTICLE VI
REPRESENTATIONS AND WARRANTIES
In order to induce the Lenders and the Administrative Agent to
enter into this Agreement and to make Loans hereunder, the Borrower represents
and warrants unto the Administrative Agent and each Lender as set forth in this
ARTICLE VI, except as otherwise indicated on the Disclosure Schedule:
SECTION 6.1 ORGANIZATION, ETC. The Borrower and each of its
Subsidiaries is a corporation or limited liability company validly incorporated
or organized and existing and in good standing under the laws of the state of
its incorporation or formation, is duly qualified to do business and is in good
standing as a foreign corporation or limited liability company in each
jurisdiction where the nature of its business requires such qualification, and
has full power and authority and holds all requisite governmental licenses,
permits and other approvals to enter into and perform its Obligations under this
Agreement, the Notes and each other Loan Document to which it is a party and to
own and hold under lease its property and to conduct its business substantially
in accordance with the first recital.
SECTION 6.2 DUE AUTHORIZATION, NON-CONTRAVENTION, ETC. The execution,
delivery and performance by the Borrower of this Agreement, the Notes and each
other Loan Document executed or to be executed by it, and the execution,
delivery and performance by each other Obligor of each Loan Document executed or
to be executed by it, are within the Borrower's and each such Obligor's
corporate powers, have been duly authorized by all necessary corporate action,
and do not
46
(a) contravene the Borrower's or any such Obligor's Organic Documents; (b)
contravene any contractual restriction, law or governmental regulation or court
decree or order binding on or affecting the Borrower or any such Obligor; or (c)
result in, or require the creation or imposition of, any Lien on any of any
Obligor's properties.
SECTION 6.3 GOVERNMENT APPROVAL, REGULATION, ETC. No authorization or
approval or other action by, and no notice to or filing with, any governmental
authority or regulatory body or other Person is required for the due execution,
delivery or performance by the Borrower of this Agreement, the Notes or any
other Loan Document to which it is a party, except for the filings of mortgages
and lien notices in connection with the granting of security interests pursuant
to the Collateral Documents. The Borrower and its Subsidiaries possess all
authorizations, approvals, permits and licenses necessary to operate their
respective businesses as currently operated and as anticipated to be operated.
Neither the Borrower nor any of its Subsidiaries is an "investment company"
within the meaning of the Investment Company Act of 1940, as amended, or a
"holding company," or a "subsidiary company" of a "holding company," or an
"affiliate" of a "holding company" or of a "subsidiary company" of a "holding
company," within the meaning of the Public Utility Holding Company Act of 1935,
as amended.
SECTION 6.4 VALIDITY, ETC. This Agreement constitutes, and the Notes
and each other Loan Document executed by the Borrower will, on the due execution
and delivery thereof, constitute, the legal, valid and binding obligations of
the Borrower enforceable in accordance with their respective terms; and each
Loan Document executed pursuant hereto by each other Obligor will, on the due
execution and delivery thereof by such Obligor, be the legal, valid and binding
obligation of such Obligor enforceable in accordance with its terms.
SECTION 6.5 FINANCIAL INFORMATION; PROJECTIONS. (a) The consolidated
balance sheets of the Borrower and each of its Subsidiaries as at December 31,
2000 and June 30, 2001, and the related consolidated statements of earnings and
cash flow of the Borrower and each of its Subsidiaries, copies of which have
been furnished to the Administrative Agent and each Lender, have been prepared
in accordance with GAAP consistently applied, and present fairly the
consolidated financial condition of the corporations covered thereby as at the
dates thereof and the results of their operations for the periods then ended,
subject, in the case of the June 30, 2001 statements, to normal year-end audit
adjustments and the omission of certain footnote disclosures. The Borrower and
each of its Subsidiaries are in compliance with all of their existing financial
obligations.
(b) The Projections are the Borrower's best estimate as
of the date the Projections were prepared, are based upon information available
as of such date, which the Borrower believes to be correct as of such date, and
are based upon assumptions the Borrower believes were reasonable as of such
date.
47
SECTION 6.6 NO MATERIAL ADVERSE CHANGE. Since December 31, 2000, there
has not been any Material Adverse Effect.
SECTION 6.7 LITIGATION, LABOR CONTROVERSIES, ETC. As of the Effective
Date, except as disclosed in SCHEDULE I, there is no pending or, to the
knowledge of the Borrower, threatened litigation, action, proceeding or labor
controversy affecting the Borrower or any of its Subsidiaries, or any of their
respective properties, businesses, assets or revenues, which could reasonably be
expected to materially adversely affect the financial condition, operations,
assets, business, properties or prospects of the Borrower or any Subsidiary or
which purports to affect the legality, validity or enforceability of this
Agreement, the Notes or any other Loan Document.
SECTION 6.8 SUBSIDIARIES. The Borrower has no Subsidiaries, except
those Subsidiaries (a) which are identified in ITEM 6.8 ("EXISTING
SUBSIDIARIES") of the Disclosure Schedule; or (b) which are permitted to have
been acquired in accordance with SECTION 7.2.5 or 7.2.8. Each Domestic
Subsidiary has executed a Guaranty; PROVIDED, HOWEVER, that so long as Inverness
does not own any assets, Inverness need not execute a Guaranty.
SECTION 6.9 OWNERSHIP OF PROPERTIES. The Borrower and each of its
Subsidiaries owns good and defensible title to all of its properties and assets,
real and personal, tangible and intangible, of any nature whatsoever (including
patents, trademarks, trade names, service marks and copyrights), free and clear
of all Liens, charges or claims (including infringement claims with respect to
patents, trademarks, copyrights and the like) except as permitted pursuant to
SECTION 7.2.3.
SECTION 6.10 TAXES. The Borrower and each of its Subsidiaries has filed
all tax returns and reports required by law to have been filed by it and has
paid all taxes and governmental charges thereby shown to be owing, except any
such taxes or charges which are being diligently contested in good faith by
appropriate proceedings and for which adequate reserves in accordance with GAAP
shall have been set aside on its books.
SECTION 6.11 PENSION AND WELFARE PLANS. During the
twelve-consecutive-month period prior to the date of the execution and delivery
of this Agreement and prior to the date of any Borrowing hereunder, no steps
have been taken to terminate any Pension Plan, and no contribution failure has
occurred with respect to any Pension Plan sufficient to give rise to a Lien
under section 302(f) of ERISA. No condition exists or event or transaction has
occurred with respect to any Pension Plan which might result in the incurrence
by the Borrower or any member of the Controlled Group of any material liability,
fine or penalty. Except as disclosed in ITEM 6.11 ("EMPLOYEE BENEFIT PLANS") of
the Disclosure Schedule, neither the Borrower nor any member of the Controlled
Group has any contingent liability with respect to any post-retirement benefit
under a Welfare Plan, other than liability for continuation coverage described
in Part 6 of Title I of ERISA.
SECTION 6.12 COMPLIANCE WITH LAW. Neither the Borrower nor any of its
Subsidiaries (a) is in violation of any law, statute, ordinance, decree,
requirement, order, judgment,
48
rule, regulation (or any interpretation of the foregoing) of, or the terms of
any license or permit issued by, any governmental authority; or (b) has failed
to obtain any license, permit, franchise or other governmental authorization
necessary to ownership of any of their respective properties or the conduct of
their respective business; which violation or failure could reasonably be
expected to have a Material Adverse Effect.
SECTION 6.13 CLAIMS AND LIABILITIES. Except as disclosed to the Lenders
in the Disclosure Schedule, neither the Borrower nor any of its Subsidiaries has
accrued any liabilities under gas purchase contracts for gas not taken, but for
which it is liable to pay if not made up and which, if not paid, would have a
Material Adverse Effect. Except as disclosed to the Lenders in the Disclosure
Schedule, no claims exist against the Borrower or its Subsidiaries for gas
imbalances which claims if adversely determined would have a Material Adverse
Effect. Except as disclosed to the Lenders in the Disclosure Schedule, no
purchaser of product supplied by the Borrower or any of its Subsidiaries has any
claim against the Borrower or any of its Subsidiaries for product paid for, but
for which delivery was not taken as and when paid for, which claim if adversely
determined would have a Material Adverse Effect.
SECTION 6.14 NO PROHIBITION ON PERFECTION OF COLLATERAL DOCUMENTS. None
of the terms or provisions of any indenture, mortgage, deed of trust, agreement
or other instrument to which the Borrower or any of its Subsidiaries is a party
or by which the Borrower or any of its Subsidiaries or the property of the
Borrower or any of its Subsidiaries is bound (other than documentation governing
Permitted Liens described in CLAUSES (a), (c), (q) and (r)) prohibit the filing
or recordation of any of the Loan Documents or any other action which is
necessary or appropriate in connection with the perfection or maintenance of the
Liens on material assets evidenced and created by any of the Loan Documents.
Notwithstanding the foregoing, (i) documents governing a Capitalized Lease
Liability or a purchase money Lien permitted by SECTION 7.2.3(q) and (r) may
prohibit other Liens on the asset encumbered by such Lien, and (ii) the Lenders
acknowledge that certain real estate leases entered into by Borrower or its
Subsidiaries prior to the Effective Date restrict or prohibit Liens on the
Borrower's or its Subsidiary's leasehold interest.
SECTION 6.15 SOLVENCY.
(a) Neither the Borrower nor the Borrower and its
Subsidiaries, on a consolidated basis, is "insolvent," as such term is used and
defined in the United States Bankruptcy Code, 11 U.S.C. Section 101, ET SEQ.
(b) Immediately after the making of each Loan, if any,
and issuance of any Letter of Credit, if any, made or issued, as the case may
be, and after giving effect to the application of the proceeds of such Loans and
Letters of Credit, (i) the value of the assets of the Borrower and its
Subsidiaries on a consolidated basis, at a fair valuation, will exceed the debts
and liabilities, subordinated, contingent or otherwise, of the Borrower and its
Subsidiaries on a consolidated basis; (ii) the present fair saleable value of
the property of the Borrower and the Subsidiaries on a
49
consolidated basis will be greater than the amount that will be required to pay
the probable liability of the Borrower and its Subsidiaries on a consolidated
basis on their debts and other liabilities, subordinated, contingent or
otherwise, as such debts and other liabilities become absolute and matured;
(iii) the Borrower and its Subsidiaries on a consolidated basis will be able to
pay their debts and liabilities, subordinated, contingent or otherwise, as such
debts and liabilities become absolute and matured; and (iv) the Borrower and its
Subsidiaries on a consolidated basis will not have unreasonably small capital
with which to conduct the businesses in which they are engaged as such
businesses are now conducted and are proposed to be conducted after the date
hereof.
(c) The Borrower does not intend to, or to permit any of
its Subsidiaries to, and does not believe that it or any of its Subsidiaries
will, incur debts beyond its ability to pay such debts as they mature, taking
into account the timing of and amounts of cash to be received by it or any such
Subsidiary and the timing of the amounts of cash to be payable on or in respect
of its Indebtedness or the Indebtedness of any such Subsidiary.
SECTION 6.16 ENVIRONMENTAL WARRANTIES. In the ordinary course of its
business, the Borrower conducts an ongoing review of the effect of Environmental
Laws on the business, operations and properties of the Borrower and its
Subsidiaries, in the course of which it identifies and evaluates associated
liabilities and costs (including any capital or operating expenditures required
for clean-up or closure of properties presently owned or operated, any capital
or operating expenditures required to achieve or maintain compliance with
environmental protection standards imposed by law or as a condition of any
license, permit or contract, any related constraints on operating activities,
including any periodic or permanent shutdown of any facility or reduction in the
level of or change in the nature of operations conducted thereat and any actual
or potential liabilities to third parties, including employees, and any related
costs and expenses). On the basis of this review, the Borrower has reasonably
concluded that, except as set forth in SCHEDULE I hereto, to the best of its
knowledge after due inquiry:
(a) all facilities and property (including underlying
groundwater) owned, leased or operated by the Borrower or any of its
Subsidiaries are owned, leased or operated by the Borrower and its Subsidiaries
in material compliance with all Environmental Laws;
(b) there are no pending or threatened, and to Borrower's
knowledge, there have been no past, continuing (i) claims, complaints, notices
or inquiries to, or requests for information received by, the Borrower or any of
its Subsidiaries with respect to any alleged violation of any Environmental Law,
that, singly or in the aggregate, have or may reasonably be expected to have a
Material Adverse Effect, or (ii) claims, complaints, notices or inquiries to, or
requests for information received by, the Borrower or any of its Subsidiaries
regarding potential liability under any Environmental Law or under any common
law theories relating to operations or the condition of any facilities or
property (including underlying groundwater) owned, leased or operated by the
Borrower and its Subsidiaries that, singly or in the aggregate, have, or may
reasonably be expected to have, a Material Adverse Effect;
50
(c) there have been no Releases of Hazardous Materials
at, on or under any property now or previously owned or leased by the Borrower
or any of its Subsidiaries that, singly or in the aggregate, have, or may
reasonably be expected to have, a Material Adverse Effect;
(d) the Borrower and its Subsidiaries have been issued
and are in material compliance with all permits, certificates, approvals,
licenses and other authorizations relating to environmental matters and
necessary or desirable for their businesses;
(e) no property now or previously owned, leased or
operated by the Borrower or any of its Subsidiaries is listed or proposed for
listing on the "National Priorities List" pursuant to CERCLA, or, to the extent
that such listing may, singly or in the aggregate, have, or may reasonably be
expected to have, a Material Adverse Effect, on the CERCLIS or on any other
federal or state list of sites requiring investigation or clean-up;
(f) there are no underground storage tanks, active or
abandoned, including petroleum storage tanks, on or under any property now or
previously owned, leased or operated by the Borrower or any of its Subsidiaries
that, singly or in the aggregate, have, or may reasonably be expected to have, a
Material Adverse Effect;
(g) none of the Borrower or any of its Subsidiaries has
directly transported or directly arranged for the transportation of any
Hazardous Material to any location which is listed or proposed for listing on
the "National Priorities List" pursuant to CERCLA, or, to the extent that such
listing may, singly or in the aggregate, have, or may reasonably be expected to
have a Material Adverse Effect, on the CERCLIS or on any federal or state list
or which is the subject of federal, state or local enforcement actions or other
investigations which may lead to material claims against the Borrower or any of
its Subsidiaries for any remedial work, damage to natural resources or personal
injury, including claims under CERCLA;
(h) there are no polychlorinated biphenyls, radioactive
materials or friable asbestos present at any property now or previously owned or
leased by the Borrower or any of its Subsidiaries that, singly or in the
aggregate, have, or may reasonably be expected to have, a Material Adverse
Effect; and
(i) no condition exists at, on or under any property now
or previously owned or leased by the Borrower or any of its Subsidiaries which,
with the passage of time, or the giving of notice or both, would give rise to
material liability under any Environmental Law that, singly or in the aggregate
have, or may reasonably be expected to have, a Material Adverse Effect.
SECTION 6.17 REGULATIONS T, U AND X. The Borrower is not engaged and
will not engage, principally or as one of its important activities, in the
business of purchasing or carrying margin stock, and no proceeds of any Loans
will be used for a purpose which violates, or would be
51
inconsistent with, F.R.S. Board Regulation T, U or X. Terms for which meanings
are provided in F.R.S. Board Regulation T, U or X or any regulations substituted
therefor, as from time to time in effect, are used in this Section with such
meanings. As of the Effective Date, the Borrower does not own any Margin Stock.
SECTION 6.18 ACCURACY OF INFORMATION. All material factual information
heretofore or contemporaneously furnished by or on behalf of the Borrower in
writing to the Administrative Agent or any Lender for purposes of or in
connection with this Agreement or any transaction contemplated hereby is, and
all other such factual information hereafter furnished by or on behalf of the
Borrower to the Administrative Agent or any Lender will be, true and accurate in
all material respects on the date as of which such information is dated or
certified, and except as amended or superseded by any such information
subsequently provided prior to the date of execution and delivery of this
Agreement, as of the date of execution and delivery of this Agreement, by the
Administrative Agent and such Lender, and such information is not, or shall not
be, as the case may be, incomplete by omitting to state any material fact
necessary to make such information not misleading. All estimates and projections
(including the Projections) delivered to the Administrative Agent or any Lender
were based upon information that was available at the time such estimates or
projections were prepared and believed to be correct and upon assumptions
believed to be reasonable; however the Borrower does not warrant that such
estimates and projections will ultimately prove to have been accurate.
SECTION 6.19 DEFAULT. No Default or Event of Default has occurred and
is continuing.
SECTION 6.20 [INTENTIONALLY LEFT BLANK].
SECTION 6.21 ▇▇▇▇▇▇▇ PLANT; OTHER PLANTS. All assets of the Borrower in
Boldman, Kentucky, Lordstown, Ohio, and Church Hill, Tennessee, including,
without limitation, the plants, terminals and storage facilities there located,
(i) constitute "Goods" as defined in Article 9 of the U.C.C., (ii) are not
affixed to the Land and are considered mobile Goods, and (iii) may be moved from
the land on which they are located to another location and reinstalled without
extraordinary cost and effort.
SECTION 6.22 OIL AND GAS RESERVES. The Borrower and each Subsidiary is
and will hereafter be, in all material respects, the owner of the Hydrocarbon
Interests that it purports to own from time to time in and under its Oil and Gas
Properties, together with the right to produce the same. The Hydrocarbon
Interests are not subject to any Lien other than Permitted Liens. All Oil and
Gas have been and will hereafter be produced, sold and delivered in accordance
in all material respects with all applicable laws and regulations; each of the
Borrower and its Subsidiaries has complied in all material respects and will
hereafter use commercially reasonable efforts to comply with all material terms
of each oil, gas and mineral lease comprising its Hydrocarbon Interests; and all
such oil, gas and mineral leases have been and will hereafter be maintained in
full force and
52
effect; PROVIDED, HOWEVER, that nothing in this SECTION 6.22 shall prevent the
Borrower or its Subsidiaries from (a) selling or otherwise disposing of assets
as permitted by SECTION 7.2.9 or (b) abandoning any well or forfeiting,
surrendering, releasing or defaulting under any lease in the ordinary course of
business and which, in the opinion of the Borrower or its Subsidiaries, is in
its best interest, PROVIDED, THAT the Borrower and its Subsidiaries is and will
hereafter be in compliance with all obligations hereunder. To the best of the
knowledge of the Borrower all agreements pursuant to which Borrower and its
Subsidiaries own their Hydrocarbon Interests are and will hereafter be
enforceable in all material respects in accordance with their terms except as
such may be modified by applicable bankruptcy law or an order of a court in
equity.
SECTION 6.23 INITIAL RESERVE REPORT. The Borrower has heretofore
delivered to the Administrative Agent a true and complete copy of the Initial
Reserve Report covering certain of the Borrower's Oil and Gas Properties located
in Canada, Michigan, New Mexico, and Colorado relating to an evaluation of the
Oil and Gas attributable to certain of the Oil and Gas Properties described
therein. To the best knowledge of the Borrower, (a) the assumptions stated or
used in the preparation of the Initial Reserve Report are reasonable, (b) all
information furnished by the Borrower to the Independent Engineer for use in the
preparation of the Initial Reserve Report was accurate in all material respects
and (c) there has been no material adverse change in the amount of the estimated
Oil and Gas shown in the Initial Reserve Report since the date thereof, except
for changes which have occurred as a result of production in the ordinary course
of business.
ARTICLE VII
COVENANTS
SECTION 7.1 AFFIRMATIVE COVENANTS. The Borrower agrees with the
Administrative Agent and each Lender that, until all Commitments have terminated
and all Obligations have been paid and performed in full, the Borrower will
perform the obligations set forth in this SECTION 7.1.
SECTION 7.1.1 FINANCIAL INFORMATION, REPORTS, NOTICES, ETC. The
Borrower will furnish, or will cause to be furnished, to the Administrative
Agent sufficient copies of the following financial statements, reports, notices
and information to provide one to each Lender:
(a) as soon as available and in any event within (i) (A)
30 days after the end of each month (other than December), and (B) within 45
days after the end of each December, a consolidated balance sheet of the
Borrower and its Subsidiaries as of the end of such month and consolidated
statements of earnings and cash flow of the Borrower and its Subsidiaries for
such month and for the period commencing at the end of the previous Fiscal Year
and ending with the end of such month, certified by the chief financial officer
of the Borrower (ii) within 45 days after the end of each of the first three
quarters of each year, the Borrower's form 10-Q for such quarter, in each case
together with a report, in form and substance satisfactory to the Administrative
Agent and the Required Lenders, reconciling the Borrower's and its Subsidiaries'
actual performance to the most recent budgets and forecasts delivered pursuant
to SECTION 5.1.10 or SECTION 7.1.1(h)(i) or (ii),
53
as the case may be, certified by the chief financial officer of the Borrower and
containing an explanation in reasonable detail for any significant negative
variances;
(b) as soon as available and in any event within 90 days
after the end of each Fiscal Year of the Borrower, a copy of the annual audit
report for such Fiscal Year for the Borrower and its Subsidiaries, including
therein consolidated balance sheets of the Borrower and its Subsidiaries as of
the end of such Fiscal Year and consolidated statements of earnings and cash
flow of the Borrower and its Subsidiaries for such Fiscal Year, certified
(without any "going concern" or other qualification) in a manner acceptable to
the Administrative Agent and the Required Lenders by PriceWaterhouseCoopers LLP
or other independent public accountants acceptable to the Administrative Agent
and the Required Lenders, together with certificates from such accountants
containing (x) a report on management's assertion about compliance (together
with management's computation of, and showing compliance) with each of the
financial ratios and restrictions contained in SECTION 7.2.4 and (y) to the
effect that, in making the examination necessary for the signing of such annual
report by such accountants, they have not become aware of any Default or Event
of Default that has occurred and is continuing, or, if they have become aware of
such Default or Event of Default, describing such Default or Event of Default
and the steps, if any, being taken to cure it; timely delivery of the Borrower's
Form 10-K pursuant to CLAUSE (f) below shall be deemed to satisfy this CLAUSE
(b).
(c) as soon as available and in any event within 45 days
after the end of each month, a certificate in the form of EXHIBIT F, executed by
the chief financial officer of the Borrower, showing (in reasonable detail and
with appropriate calculations and computations in all respects satisfactory to
the Administrative Agent) compliance with the financial covenants set forth in
SECTION 7.2.4 and setting forth such information as is required in such form;
(d) as soon as possible and in any event within three
Business Days after the Borrower obtains knowledge of the occurrence of each
Default, a statement of the chief financial officer of the Borrower setting
forth details of such Default and the action which the Borrower has taken and
proposes to take with respect thereto;
(e) as soon as possible and in any event within three (3)
Business Days after the Borrower obtains knowledge of any of the following if it
could reasonably be expected to result in a Material Adverse Effect if adversely
determined: (i) the occurrence of any adverse development with respect to any
litigation, action, proceeding, or labor controversy described in SECTION 6.7,
(ii) the commencement of any labor controversy, litigation, action, proceeding
of the type described in SECTION 6.7, notice thereof and copies of all
documentation relating thereto, (iii) any adverse development involving, or
material default by any party under, or breach by any party of any material
contract or agreement to which the Borrower or any Subsidiary is a party or by
which it is bound, or (iv) any dispute, litigation, investigation, proceeding or
suspension between the Borrower or any Subsidiary and any Governmental
Authority;
54
(f) promptly after the sending or filing thereof, copies
of all reports which the Borrower sends to any of its security holders, and all
reports and registration statements (without exhibits) which the Borrower or any
of its Subsidiaries files with the Securities and Exchange Commission or any
national securities exchange;
(g) within three (3) Business Days upon becoming aware of
the institution of any steps by the Borrower or any other Person to terminate
any Pension Plan, or the failure to make a required contribution to any Pension
Plan if such failure is sufficient to give rise to a Lien under section 302(f)
of ERISA, or the taking of any action with respect to a Pension Plan which could
result in the requirement that the Borrower furnish a bond or other security to
the PBGC or such Pension Plan, or the occurrence of any event with respect to
any Pension Plan which could result in the incurrence by the Borrower of any
material liability, fine or penalty, or any material increase in the contingent
liability of the Borrower with respect to any post-retirement Welfare Plan
benefit, notice thereof and copies of all documentation relating thereto;
(h) (i) annually, on or before March 31 of each year and
(ii) promptly upon request of the Administrative Agent or the Required Lenders
(which requests may not be more frequent than once each quarter), a budget for
the year commencing the preceding January 1 and a five-year forecast for the
Borrower and its Subsidiaries in form and substance satisfactory to the
Administrative Agent and the Required Lenders and consistent with the budget and
projections delivered pursuant to SECTION 5.1.10 and based upon information that
is then currently available and believed to be correct and upon assumptions
believed to be reasonable;
(i) the Borrower shall deliver to the Administrative
Agent, promptly upon sending or receipt, copies of any and all management
letters and correspondence relating to management letters, sent or received by
the Borrower or any of its Subsidiaries to or from PriceWaterhouseCoopers LLP or
other independent public accountants acceptable to the Administrative Agent and
the Required Lenders;
(j) as soon as available, but not later than 60 days
after the close of each of the first three Fiscal Quarters of each year,
beginning with the Fiscal Quarter ending September 30, 2001, and not later than
90 days after the close of each Fiscal Quarter ending on December 31, a
Quarterly Status Report as of the last day of the immediately preceding quarter;
(k) on or before April 1, effective as of January 1, of
each year during the term of this Agreement, a Reserve Report prepared by an
independent petroleum engineer acceptable to the Required Lenders (the
"INDEPENDENT ENGINEER");
(l) promptly upon the request of the Administrative
Agent, such copies of all geological, engineering and related data contained in
the Borrower's files or readily accessible to the Borrower relating to its and
its Subsidiaries' Oil and Gas Properties as may reasonably be requested; and
55
(m) such other information respecting the condition or
operations, financial or otherwise, or properties or assets of the Borrower or
any of its Subsidiaries as any Lender through the Administrative Agent may from
time to time reasonably request in writing.
SECTION 7.1.2 COMPLIANCE WITH LAWS, ETC. The Borrower will, and will
cause each of its Subsidiaries to, comply with all applicable laws, rules,
regulations and orders (including Environmental Laws), such compliance to
include, without limitation, (a) the maintenance and preservation of its
corporate, partnership or limited liability company existence and qualification
as a foreign corporation, partnership or limited liability company; and (b) the
payment, before the same become delinquent, of all taxes, assessments and
governmental charges imposed upon it or upon its property except to the extent
being diligently contested in good faith by appropriate proceedings and for
which adequate reserves in accordance with GAAP shall have been set aside on its
books, except where the failure to so comply with the terms of this SECTION
7.1.2 shall not reasonably be expected to have a Material Adverse Effect.
SECTION 7.1.3 MAINTENANCE OF PROPERTIES. The Borrower will, and will
cause each of its Subsidiaries to, maintain, preserve, protect and keep its
properties in good repair, working order and condition in all material respects,
and make necessary and proper repairs, renewals and replacements so that its
business carried on in connection therewith may be properly conducted at all
times unless the Borrower determines in good faith that the continued
maintenance of any of its properties is no longer economical.
SECTION 7.1.4 USE OF PROCEEDS. The proceeds of the Loans under the
Revolving Facility and the proceeds of the Term Loans shall be used to refinance
existing indebtedness of the Borrower under the Existing Credit Agreement and
for general corporate and working capital purposes of the Borrower and its
Subsidiaries.
SECTION 7.1.5 INSURANCE. The Borrower will, and will cause each of its
Subsidiaries to, maintain or cause to be maintained with responsible insurance
companies insurance with respect to its properties and business (including
business interruption insurance) against such casualties and contingencies and
of such types and in such amounts as is customary in the case of similar
businesses and which is satisfactory to the Administrative Agent and the
Required Lenders and will (a) furnish to the Administrative Agent on each
anniversary of the Effective Date a certificate or certificates of insurance
from Borrower's insurance companies evidencing the existence of all insurance
required to be maintained by the Borrower by this Agreement and the other Loan
Documents and that Administrative Agent is listed as additional insured and sole
loss payee, and (b) upon request of the Administrative Agent, furnish to each
Lender at reasonable intervals a certificate of an Authorized Officer of the
Borrower setting forth the nature and extent of all insurance maintained by the
Borrower and its Subsidiaries in accordance with this Section.
56
Except as the Administrative Agent may otherwise consent to in
writing, Borrower will, and will cause each of its Subsidiaries to, forthwith
upon receipt, transmit and deliver to the Administrative Agent, in the form
received, all cash, checks, drafts, chattel paper and other instruments or
writings for the payment of money (properly endorsed, where required, so that
such items may be collected by the Administrative Agent) which may be received
by the Borrower at any time in full or partial payment of amounts due under any
insurance policy. Except as the Administrative Agent may otherwise consent in
writing, any such items which may be received by the Borrower will not be
commingled with any other of its funds or property, but will be held separate
and apart from its own funds or property and upon express trust for the
Administrative Agent until delivery is made to the Administrative Agent.
Borrower will comply with the terms and conditions of any consent given by the
Administrative Agent pursuant to the provisions of this paragraph.
All items or amounts which are delivered by the Borrower or by
any insurance company to the Administrative Agent on account of partial or full
payment of amounts due under any insurance policy shall be deposited to the
credit of a deposit account (herein called the "INSURANCE DEPOSIT ACCOUNT") of
the Borrower with the Administrative Agent, as security for payment of the
Obligations. Borrower shall have no right to withdraw any funds deposited in the
Insurance Deposit Account. Administrative Agent will apply all or any of the
then balance in the Insurance Deposit Account toward payment of the Obligations,
in such order of application as the Administrative Agent may determine.
Administrative Agent may, from time to time, in its reasonable discretion and
with the consent of the Required Lenders, release all or any of such balance
representing collected funds to the Borrower. Administrative Agent is authorized
to endorse, in the name of the Borrower, any item, howsoever received by the
Administrative Agent, representing any payment under any insurance policy.
SECTION 7.1.6 BOOKS AND RECORDS. The Borrower will, and will cause each
of its Subsidiaries to, keep books and records which accurately reflect all of
its business affairs and transactions and permit the Administrative Agent and
each Lender or any of their respective representatives, at reasonable times and
intervals, to visit all of its offices and properties, to discuss its financial
matters with its officers and independent public accountant (and the Borrower
hereby authorizes such independent public accountant to discuss the Borrower's
financial matters with each Lender or its representatives with a representative
of the Borrower present) and to examine (and, at the expense of the Borrower,
photocopy extracts from) any of its books or other corporate records. The
Borrower shall pay any fees of such independent public accountant incurred in
connection with the Administrative Agent's or any Lender's exercise of its
rights pursuant to this Section.
SECTION 7.1.7 ENVIRONMENTAL COVENANT. The Borrower will, and will cause
each of its Subsidiaries to, (a) use and operate all of its facilities and
properties in compliance with all Environmental Laws, keep all necessary
permits, approvals, certificates, licenses and other authorizations relating to
environmental matters in effect and remain in compliance therewith, and handle
all Hazardous Materials in compliance with all applicable Environmental Laws,
except where
57
the failure to so comply shall not reasonably be expected to have a Material
Adverse Effect; and (b) provide such information and certifications which the
Administrative Agent may reasonably request from time to time to evidence
compliance with this SECTION 7.1.7; PROVIDED, THAT neither the Administrative
Agent nor any Lender shall have any obligation to make any inquiries pursuant to
this SECTION 7.1.7.
SECTION 7.1.8 FURTHER ASSURANCES; ADDITIONAL COLLATERAL. (a) The
Borrower shall cause each Domestic Subsidiary, from time to time, to become an
Obligor with respect to, and jointly and severally liable with all other
Obligors for, all the Obligations under this Agreement and the Notes and the
other Loan Documents by promptly executing and delivering to the Lenders a
Guaranty substantially in the form of EXHIBIT G hereto, with appropriate
insertions, and by causing such Domestic Subsidiary's, as the case may be,
capital stock, partnership, joint venture or membership interest to be pledged
pursuant to a pledge agreement in form satisfactory to the Administrative Agent.
(b) The Borrower shall and shall cause its Subsidiaries
to take such actions and to execute and deliver such documents and instruments
as the Administrative Agent shall require to ensure that the Administrative
Agent on behalf of the Lenders shall, at all times, have received currently
effective duly executed Loan Documents encumbering substantially all of the
Borrower's and its Domestic Subsidiaries' assets, including (i) 100% of the
stock or other equity interest in each Domestic Subsidiary, and 65% of the stock
or other equity interest in each Foreign Subsidiary, (ii) 75% of the total value
of all of the Borrower's and its Domestic Subsidiaries' Oil and Gas Properties
evaluated in the most recent Reserve Report, and (iii) all of the Borrower's and
its Domestic Subsidiaries' other material assets and properties, both tangible
and intangible, both personal and real, other than assets encumbered by Liens
permitted by SECTION 7.2.3(q) , (r) AND (s).
(c) (i) In connection with the actions required pursuant
to the foregoing SUBSECTIONS (a) and (b), the Borrower shall and shall cause its
Subsidiaries to execute and deliver such stock certificates, blank stock powers,
evidence of corporate authorization, opinions of counsel, current valuations,
evidence of title, title opinions, title insurance and other documents, and
shall use commercially reasonable efforts to obtain landlord and mortgagee
waivers and third party consents, as shall be requested by the Administrative
Agent, in each case in form and substance satisfactory to the Administrative
Agent.
(ii) On or before the delivery of each Reserve
Report required by SECTION 7.1.1(k), the Borrower shall deliver to the
Administrative Agent such title information as the Administrative Agent may
require setting forth the status of title acceptable to the Administrative Agent
covering enough of the Oil and Gas Properties included in such Reserve Report so
that the Administrative Agent shall have received, together with the title
information previously delivered to the Administrative Agent, satisfactory title
information on at least 75% of the value of the Borrower's and its Subsidiaries'
Oil and Gas Properties included in such Reserve Reports.
58
(d) The liens required by this SECTION 7.1.8 shall be
first priority perfected liens in favor of the Administrative Agent, subject to
no other liens except Permitted Liens. If the Administrative Agent shall
determine that, as of any date, the Borrower shall have failed to comply with
this SECTION 7.1.8, the Administrative Agent may (and at the direction of the
Required Lenders, shall) notify the Borrower in writing of such failure and,
within 30 days from and after receipt of such written notice by the Borrower,
the Borrower shall execute and deliver to the Administrative Agent supplemental
or additional Loan Documents, in form and substance satisfactory to the
Administrative Agent and its counsel, securing payment of the Notes and the
other Obligations and covering additional assets and properties not then
encumbered by any Loan Documents (together with such current valuations,
engineering reports, appraisals, and title opinions or insurance applicable to
the additional assets and properties collaterally assigned, as may be requested
by the Administrative Agent, each of which shall be in form and substance
satisfactory to the Administrative Agent) such that the Administrative Agent
shall have received currently effective duly executed and perfected Collateral
Documents encumbering substantially all of the material assets and properties of
the Borrower and its Domestic Subsidiaries as required by SECTION 7.1.8(b).
SECTION 7.1.9 COMPLIANCE WITH HEDGING POLICY; HEDGING AGREEMENTS. (a)
Attached hereto as EXHIBIT L is a copy of the Borrower's hedging policy (the
"HEDGING POLICY"). Borrower shall at all times comply in all material respects
with, and perform any and all obligations and actions set forth in, the terms
and provisions of the Hedging Policy. No changes shall be made to the Hedging
Policy except in compliance with SECTION 7.2.1.
(b) Within five (5) Business Days after the Effective
Date, the Borrower shall enter into commodity price protection agreements
containing terms, and with counterparties, satisfactory to the Administrative
Agent, covering volumes of not less than 70% of the reasonably estimated
projected production of the Borrower's and its Subsidiaries' Canadian Oil and
Gas Properties, as determined by reference to the Initial Reserve Reports,
during the period from the Effective Date and ending on December 31, 2004. The
Borrower shall maintain the hedged position required by this SECTION 7.1.9(b)
during the period and in accordance with the terms specified herein.
SECTION 7.1.10 HEDGING AGREEMENTS. Borrower shall, and shall cause each
of its Subsidiaries to, (a) as soon as available and in any event within (i) 30
days after the end of each month (other than December), and (ii) within 45 days
after the end of each December, deliver to the Administrative Agent a summary of
all existing Hedging Agreement entered into by Borrower or any of its
Subsidiaries, including, without limitation, the amount of the Hedging
Obligation, the quantity of hedged volumes and the hedged price relating to each
such Hedging Agreement, and the Counterparty for each such Hedging Agreement,
and (b) at the request of the Administrative Agent, provide the Administrative
Agent with a copy of such Hedging Agreement, any related confirmations and/or
any similar documentation for each such Hedging Agreement.
SECTION 7.1.11 PERFORMANCE OF OBLIGATIONS. The Borrower shall (and
shall cause its Subsidiaries to, comply in all material respects with all of its
(and their) obligations under all
59
material contracts including, but not limited to, contracts relating to the
properties of the Borrower or its Subsidiaries or by which the Borrower (or such
Subsidiaries, as applicable) are bound.
SECTION 7.1.12 PAYMENT OF TAXES AND CLAIMS. The Borrower will and will
cause each of its Subsidiaries to file all tax returns required to be filed in
any jurisdiction and to pay and discharge all taxes shown to be due and payable
on such returns and all other taxes, assessments, governmental charges, or
levies imposed on them or any of their properties, assets, income or franchises,
to the extent such taxes and assessments have become due and payable and before
they have become delinquent and all claims for which sums have become due and
payable that have or might become a Lien on properties or assets of the Borrower
or any Subsidiary, PROVIDED, THAT neither the Borrower nor any Subsidiary need
pay any such tax or assessment or claims if (a) the amount, applicability or
validity thereof is contested by the Borrower or such Subsidiary on a timely
basis in good faith and in appropriate proceedings, and the Borrower or a
Subsidiary has established adequate reserves therefor in accordance with GAAP on
the books of the Borrower or such Subsidiary or (b) the nonpayment of all such
taxes and assessments in the aggregate could not reasonably be expected to have
a Material Adverse Effect.
SECTION 7.1.13 ERISA INFORMATION AND COMPLIANCE. The Borrower will
promptly furnish and will cause the Subsidiaries and any ERISA Affiliate to
promptly furnish to the Administrative Agent (a) promptly after the filing
thereof with the United States Secretary of Labor, the Internal Revenue Service
or the PBGC, copies of each annual and other report with respect to each Plan or
any trust created thereunder, (b) 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 a 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 thereto, and (c) 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, (x) 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 sections 303, 304 and 306
of ERISA), and (y) 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 7.2 NEGATIVE COVENANTS. The Borrower agrees with the
Administrative Agent and each Lender that, until all Commitments have
terminated, all Obligations have been paid and performed in full, and no Letters
of Credit remain outstanding, the Borrower will perform the obligations set
forth in this SECTION 7.2.
60
SECTION 7.2.1 BUSINESS ACTIVITIES. The Borrower will not, and will not
permit any of its Subsidiaries to, engage in any business activity, except those
described in the FIRST RECITAL and such activities as may be incidental or
related thereto; PROVIDED, THAT prior to making any material change after the
date hereof in the Borrower's natural gas, natural gas liquids and crude oil
marketing business or Hedging Policy (including any net open position), the
Borrower will give ten (10) Business Days advance notice to Administrative Agent
and the Lenders.
SECTION 7.2.2 INDEBTEDNESS. The Borrower will not, and will not permit
any of its Subsidiaries to, create, incur, assume or suffer to exist or
otherwise become or be liable in respect of any Indebtedness, other than,
without duplication, the following: (a) Indebtedness in respect of the Loans and
other Obligations; (b) Indebtedness under the Canadian Credit Agreement; (c)
unsecured Indebtedness incurred in the ordinary course of business consisting of
open accounts extended by suppliers and customers on normal trade terms in
connection with purchases or sales of goods and services, but excluding
Indebtedness incurred through the borrowing of money or Contingent Liabilities;
(d) (i) at any time that the Canadian Facility is not in place, other
Indebtedness of the Borrower and its Domestic Subsidiaries in an aggregate
amount not to exceed $10,000,000, and (ii) at any time that the Canadian
Facility is in place, (A) Indebtedness of the Borrower's Canadian Subsidiaries
in an aggregate principal amount not greater than the Canadian Ratio TIMES
$10,000,000, and (B) Indebtedness of the Borrower and its Domestic Subsidiaries
which, when aggregated with the principal amount of Indebtedness outstanding
pursuant to the preceding CLAUSE (A), does not exceed $10,000,000 at any time
outstanding; (e) Indebtedness owed by a Subsidiary to the Borrower or to a
Wholly-Owned Subsidiary, or by the Borrower to a Wholly-Owned Subsidiary,
PROVIDED, THAT in each such case such Indebtedness is evidenced by a promissory
note which has been pledged to secure the Obligations and is in the possession
of the Administrative Agent, and such Indebtedness is subordinated to the
Obligations upon terms and conditions satisfactory to the Administrative Agent;
(f) Indebtedness resulting from any Hedging Obligations; (g) Indebtedness
arising in respect of the West Shore/Basin Purchase Agreement; and (h) payments
pursuant to the Incentive Payments Agreement; PROVIDED, HOWEVER, notwithstanding
the foregoing, that the Borrower will not, and will not permit any of its
Subsidiaries to, create, incur, assume or otherwise become or be liable in
respect of any additional Indebtedness otherwise permitted by CLAUSES (d) or (h)
if, after giving effect to the incurrence thereof, any Default shall have
occurred and be continuing.
SECTION 7.2.3 LIENS. The Borrower will not, and will not permit any of
its Subsidiaries to, create, incur, assume or suffer to exist any Lien upon any
of its property, revenues or assets, whether now owned or hereafter acquired,
except the following ("PERMITTED LIENS"):
(a) Liens in existence on the date hereof listed on the
Disclosure Schedule, PROVIDED, that no such Lien shall be extended to cover any
additional property after the date of this Agreement and that the amount of
Indebtedness secured thereby is not increased;
(b) Liens securing payment of the Obligations, granted
pursuant to any Loan Document;
61
(c) Liens securing payment of the "Obligations" under the
Canadian Credit Agreement;
(d) Liens in favor of a Lender or an Affiliate of Lender
on assets of Canadian Subsidiaries of the Borrower securing Hedging Agreements
to which a Canadian Subsidiary of the Borrower is a party, subject to the
Intercreditor Agreement;
(e) Liens for taxes, assessments or other governmental
charges or levies not at the time delinquent or thereafter payable without
penalty or being diligently contested in good faith by appropriate proceedings
and for which adequate reserves in accordance with GAAP shall have been set
aside on its books;
(f) Liens of carriers, warehousemen, mechanics,
materialmen, landlords and other similar statutory or equitable Liens incurred
in the ordinary course of business for sums not overdue or being diligently
contested in good faith by appropriate proceedings and for which adequate
reserves in accordance with GAAP shall have been set aside on its books;
(g) Liens incurred in the ordinary course of business in
connection with workmen's compensation, unemployment insurance or other forms of
governmental insurance or benefits, or to secure performance of tenders,
statutory obligations, leases and contracts (other than for borrowed money)
entered into in the ordinary course of business or to secure obligations on
surety or appeal bonds, in each case as such Liens arise in the ordinary cause
of business and in each case PROVIDED, THAT the obligations secured thereby are
not at the time delinquent or thereafter payable without penalty or being
diligently contested in good faith by appropriate proceedings and for which
adequate reserves in accordance with GAAP shall have been set aside on its
books;
(h) judgment Liens which do not constitute an Event of
Default that are in existence less than 30 days after the entry thereof or with
respect to which execution has been stayed or the payment of which is covered in
full (subject to a customary deductible) by insurance maintained with
responsible insurance companies;
(i) hydrocarbon or natural gas sales contracts liens
reserved in customary oil and gas leases for bonus or rental payments,
royalties, overriding royalties and joint operating agreements, PROVIDED, THAT
such Liens secure claims which either are not delinquent or are being contested
in good faith by the Borrower or a Subsidiary by appropriate proceedings and for
which adequate reserves in accordance with GAAP shall have been set aside on its
books;
(j) covenants, restrictions, easements, servitudes,
permits, conditions, exceptions, reservations, minor rights, minor encumbrances,
minor irregularities in title or conventional rights of reassignment prior to
abandonment which do not materially interfere with the occupation, use and
enjoyment by the Borrower or any of its Subsidiaries of its respective assets in
the ordinary course of
62
business as presently conducted, or materially impair the value thereof for the
purpose of such business;
(k) Liens reserved in or exercisable under any lease or
sublease to which any Borrower or Subsidiary is a lessee which secure the
payment of rent or compliance with the terms of such lease or sublease;
PROVIDED, THAT the rent under such lease or sublease is not then overdue and the
Borrower or Subsidiary is in material compliance with the terms and conditions
thereof;
(l) Liens in favor of any Person (other than the Borrower
or any Affiliate of the Borrower) under any pooling, unit, development, farmout,
participation, overriding royalty, net profits interest, carried interest,
reversionary interest, operating agreement or similar agreement affecting the
property which is the subject of such agreement, PROVIDED, THAT (i) such
agreement is entered into in the ordinary course of business in accordance with
standard industry practice, (ii) such Liens have not become subject to
enforcement proceeding that have not been dismissed or stayed or (iii) the
obligations secured thereby are not overdue, or if overdue, are being contested
by the Borrower or Subsidiary diligently and in good faith by appropriate
proceedings and for which adequate reserves in accordance with GAAP shall have
been set aside on its books;
(m) Liens incurred or created in the ordinary course of
business and in accordance with customary oil and gas industry practice as
security in favor of a Person (other than the Borrower or any Affiliate of the
Borrower) conducting the development or operation of any Oil and Gas Properties
or to secure Borrower's or any Subsidiary's proportionate share of costs and
expenses of such development or operations, which amounts are not overdue, or if
overdue, are being contested by the Borrower or Subsidiary diligently and in
good faith by appropriate proceedings and for which adequate reserves in
accordance with GAAP shall have been set aside on its books;
(n) Liens on Oil and Gas or the proceeds of Oil and Gas
pursuant to a processing or transmission arrangement, with a Person other than
the Borrower or an Affiliate of the Borrower, entered into or assumed by the
Borrower or a Subsidiary in the ordinary course of its business, securing the
payment of its obligations in respect of the fees, costs and expenses
attributable to the processing or transmission (as the case may be) of any such
Oil and Gas under any agreement or arrangement; PROVIDED, THAT the obligations
secured thereby are not overdue, are being contested by the Borrower or
Subsidiary diligently and in good faith by appropriate proceedings; and for
which adequate reserves in accordance with GAAP shall have been set aside on its
books;
(o) any interest or title of a lessor under any lease
entered into by the Borrower or any Subsidiary in the ordinary course of its
business and covering only the assets so leased;
(p) Liens incurred in the ordinary course of business in
connection with margin requirements under Hedging Agreements not to exceed in
the aggregate $8,500,000 at any time outstanding;
63
(q) Liens securing Capitalized Lease Obligations PROVIDED
THAT such Capitalized Lease Obligations are permitted under SECTION 7.2.2(d);
(r) Purchase money Liens upon or in any property acquired
by Borrower or any of its Subsidiaries to secure the deferred portion of the
purchase price of such property or to secure Indebtedness incurred to finance
the acquisition of such property, PROVIDED THAT (i) no such Lien shall be
extended to cover property other than the property being acquired, and (ii) the
Indebtedness thereby secured is permitted by SECTION 7.2.2(d); and
(s) any Lien existing on any asset (other than stock of a
Subsidiary) prior to acquisition thereof by the Borrower or a Subsidiary, and
not created in contemplation of such acquisition, PROVIDED THAT (i) no such Lien
shall be extended to cover property other than the asset being acquired, (ii)
such Lien was not created in contemplation of or in connection with such
acquisition, (iii) the Indebtedness thereby secured is permitted by SECTION
7.2.2(d), and (iv) the fair market value of such asset shall at no time exceed
150% of the Indebtedness thereby secured.
SECTION 7.2.4 FINANCIAL COVENANTS. The Borrower will not permit:
(a) As of the end of any calendar month, its Tangible Net
Worth to be less than $45,400,000 PLUS 50% of Consolidated Net Income of the
Borrower and its Subsidiaries, if positive, for the period from July 1, 2001
through such month-end date PLUS 75% of the aggregate increases in shareholders'
equity (determined in accordance with GAAP) of the Borrower and its subsidiaries
after Closing by reason of the issuance and sale of capital stock of the
Borrower (including the conversion of any debt securities of the Borrower into
capital stock).
(b) Its Current Ratio to be less than 1:1 as of the end
of any calendar month.
(c) Its Leverage Ratio to be greater than the amounts set
forth below as of the last day of each month ending during the following
periods:
64
As of the Last Date of
Maximum Leverage Ratio each Month Ending During
---------------------- the Period Set Forth Below
--------------------------
3.75 Effective Date through 12/31/01
3.50 1/31/02 through 3/31/02
3.25 4/30/02 through 6/30/02
3.00 7/31/02 and thereafter
(d) Its Fixed Charge Coverage Ratio to be less than the
amounts set forth below as of the last day of each month ending during the
following periods:
As of the Last Date of
Minimum Fixed Charge each Month Ending During
Coverage Ratio the Period Set Forth Below
-------------- --------------------------
1.50 Effective Date through 3/31/02
1.75 4/30/02 through 3/31/03
2.00 4/30/03 through 3/31/04
2.25 4/30/04 and thereafter
SECTION 7.2.5 INVESTMENTS. (a) The Borrower will not, and will not
permit any of its Subsidiaries to, make, incur, assume or suffer to exist any
Investment in any other Person, except: (i) Investments existing on the
Effective Date and identified in ITEM 7.2.5(a) ("ONGOING INVESTMENTS") of the
Disclosure Schedule; (ii) Cash Equivalent Investments; (iii) without
duplication, Investments permitted as Indebtedness pursuant to SECTION 7.2.2;
(iv) Investments permitted by SECTION 7.2.8; (v) in the ordinary course of
business, Investments by the Borrower or any of its Subsidiaries in any
Subsidiaries, by way of contributions to capital or loans or advances, subject
to SECTION 7.2.2 in the case of loans or advances; or (vi) Investments incurred
in order to consummate Acquisitions otherwise permitted herein, PROVIDED, THAT
such Acquisition shall have been approved or consented to by the board of
directors or similar governing entity of the Person being acquired; and (vii)
acquisition of not more than 5% of the outstanding equity securities of any
Person (other than the Borrower); PROVIDED, HOWEVER, that (A) any Investment
which when made complies with the requirements of the definition of the term
"CASH EQUIVALENT INVESTMENT" may
65
continue to be held notwithstanding that such Investment if made thereafter
would not comply with such requirements; (B) no Investment otherwise permitted
by CLAUSE (vii) shall be permitted to be made if, immediately before or after
giving effect thereto, any Default shall have occurred and be continuing; (C)
any Investment otherwise permitted by CLAUSES (iv), (v), (vi) or (vii) in an
entity engaged in or to be engaged in the natural gas, natural gas liquids or
crude oil or other energy marketing business shall be structured in a manner
acceptable to the Required Lenders; and (D) Investments made after August 10,
2001 in Foreign Subsidiaries or in assets located outside the United States
shall not exceed an aggregate amount equal to ten percent (10%) of the
Borrower's consolidated assets at the time that the Investment is made.
SECTION 7.2.6 RESTRICTED PAYMENTS, ETC. On and at all times after the
Effective Date, (a) the Borrower will not declare, pay or make any dividend or
distribution (in cash, property or obligations) on any shares of any class of
capital stock (now or hereafter outstanding) of the Borrower or on any warrants,
options or other rights with respect to any shares of any class of capital stock
(now or hereafter outstanding) of the Borrower (other than dividends or
distributions payable in its common stock or warrants to purchase its common
stock or splitups or reclassifications of its stock into additional or other
shares of its common stock) or apply, or permit any of its Subsidiaries to
apply, any of its funds, property or assets to the purchase, redemption, sinking
fund or other retirement of, or agree or permit any of its Subsidiaries to
purchase or redeem, any shares of any class of capital stock (now or hereafter
outstanding) of the Borrower, or warrants, options or other rights with respect
to any shares of any class of capital stock (now or hereafter outstanding) of
the Borrower if the aggregate amount of such dividends, distributions and
applications for the current and the preceding three Fiscal Quarters exceeds the
lesser of (i) 50% of consolidated net income of the Borrower and its
Subsidiaries for the current and the preceding three Fiscal Quarters or (ii)
$2,000,000, PROVIDED, HOWEVER, that, notwithstanding the foregoing and only with
respect to activities required or permitted under the MarkWest 401(k) Plan,
Borrower shall be permitted to purchase or redeem up to $1,000,000 in the
aggregate per annum of shares of any class of capital stock (now or hereafter
outstanding) of the Borrower on the open-market or held in Borrower's 401(k),
and (b) the Borrower will not, and will not permit any Subsidiary to, make any
deposit for any purchase, redemption, distribution or other payment that would
be prohibited by this Section. This Section shall not be construed so as to
prohibit MarkWest Canada Co. from making payments under the Incentive Payments
Agreement.
SECTION 7.2.7 RENTAL OBLIGATIONS. The Borrower will not, and will not
permit any of its Subsidiaries to, enter into at any time any arrangement
(excluding oil and gas leases entered into in the ordinary course of business
and arrangements which create Capitalized Lease Liabilities permitted under
SECTION 7.2.2) which involves the leasing by the Borrower or any of its
Subsidiaries from any lessor of any real or personal property (or any interest
therein), including, without limitation, pursuant to any sale-leaseback
transaction, except for (a) at any time the Canadian Facility is not in
place,(i) arrangements for the Borrower's Foreign Subsidiaries which will not
require the payment of an aggregate amount of rentals during the full remaining
term of such arrangements in excess of (excluding escalations resulting from a
rise in the consumer price or
66
similar index) $2,700,000, and (ii) arrangements for the Borrower and its
Domestic Subsidiaries which, together with all other such arrangements which
shall then be in effect and together with the arrangements described in the
preceding CLAUSE (i), will not require the payment of an aggregate amount of
rentals during the full remaining term of such arrangements in excess of
(excluding escalations resulting from a rise in the consumer price or similar
index) $15,000,000, and (b) at any time the Canadian Facility is in place,
arrangements for the Borrower and its Subsidiaries which will not require the
payment of an aggregate amount of rentals during the full remaining term of such
arrangements in excess of (excluding escalations resulting from a rise in the
consumer price or similar index) $15,000,000, in each case during the full
remaining term of such arrangements; PROVIDED, HOWEVER, that any calculation
made for purposes of this Section for any period shall exclude any payments
relating to office rentals arising in connection with the Borrower's sale of the
building located at 155 Inverness in Englewood, Colorado which do not exceed the
sum of (i) $540,000 per Fiscal Year PLUS (ii) the Borrower's pro rata share of
the amount of the increase in the "operating expenses" for each Fiscal Year as
set forth in the applicable lease; and PROVIDED FURTHER that any calculation
made for purposes of this Section shall exclude any amounts required to be
expended for maintenance and repairs, insurance, taxes, assessments, and other
similar charges.
SECTION 7.2.8 CONSOLIDATION, MERGER, ETC. The Borrower will not, and
will not permit any of its Subsidiaries to, liquidate or dissolve, consolidate
with, or merge into or with, any other corporation, or purchase or otherwise
acquire all or substantially all of the assets of any Person (or of any division
thereof), except (a) any such Subsidiary may liquidate or dissolve voluntarily
into, and may merge with and into, the Borrower or any other Subsidiary,
PROVIDED THAT if the Borrower is a party to a merger, the Borrower is the
surviving entity, and the assets or stock of any Subsidiary may be purchased or
otherwise acquired by the Borrower or any other Subsidiary; and (b) so long as
no Default has occurred and is continuing or would occur after giving effect
thereto, in connection with Investments permitted by SECTION 7.2.5, the Borrower
or any of its Subsidiaries may purchase all or substantially all of the assets
of any Person, or acquire such Person by merger, if the Borrower (if a party to
such merger) or such Subsidiary (if the Borrower is not a party to such merger)
is the survivor of such merger.
SECTION 7.2.9 ASSET DISPOSITIONS, ETC. (a) The Borrower will not, and
will not permit any of its Subsidiaries to, sell, transfer, lease, contribute or
otherwise convey, or grant options, warrants or other rights with respect to,
all or any substantial part of its assets (including capital stock of
Subsidiaries) to any Person.
(b) The Borrower will not, and will not permit any of its
Subsidiaries to, sell, convey, contribute or transfer any asset (including,
without limitation, any sale or assignment with or without recourse of any
receivable) except: (i) retirement of assets in the ordinary course of business;
(ii) the sale, conveyance, contribution or transfer of any asset or assets
having a fair market value at the time of sale, conveyance, contribution or
transfer of $10,000,000 or less in the aggregate for all such sales,
conveyances, contributions and transfers in any calendar year; (iii) the sale of
Oil and Gas production and inventory in the ordinary course of business,
including in connection with
67
hedge agreements or pursuant to long-term contracts; (iv) any conveyance or
transfer by a Subsidiary of the Borrower to the Borrower, or by a Subsidiary of
the Borrower to a wholly owned Subsidiary of Borrower; (v) transfers by the
Borrower to a Subsidiary permitted by SECTION 7.2.5; and (vi) transfers of
Hydrocarbon Interests which transfers constitute payments in kind pursuant to
the Incentive Payments Agreement. Notwithstanding the foregoing, the Borrower
shall not, nor shall the Borrower permit any of its Subsidiaries to, transfer
any assets, other than the sale of Oil and Gas production and inventory and
payment of trade payables in the ordinary course of business pursuant to SECTION
7.2.9(b)(iii), to any Person pursuant to this SECTION 7.2.9 if a Default shall
have occurred and be continuing or would otherwise be existing after, or result
from, any such transfer.
SECTION 7.2.10 SUBORDINATED DEBT DOCUMENTS. The Borrower will not, and
will not permit any of its Subsidiaries to, amend any Subordinated Debt Document
unless approved in writing by the Required Lenders (other than ministerial
amendments and amendments to extend the time or times for payment). The Borrower
shall not make any payments of interest or any other amounts in respect of the
Subordinated Debt if a Default shall have occurred and be continuing or would
result from such payment. The Borrower will not prepay any principal, interest
or other indebtedness in respect of Subordinated Debt, or make any redemption or
acquisition for value or defeasance, refinancing or exchange (other than for PIK
Notes) thereof or therefor, or make any payments in contravention of the
Subordination Agreement. Any PIK Notes shall have the same terms as the related
Subordinated Notes, except as otherwise approved by the Required Lenders, and
shall be considered Subordinated Notes for purposes of this Agreement and the
Subordination Agreement.
SECTION 7.2.11 TRANSACTIONS WITH AFFILIATES. The Borrower will not, and
will not permit any of its Subsidiaries to, enter into, or cause, suffer or
permit to exist any arrangement or contract with any of its other Affiliates
unless such arrangement or contract is fair and equitable to the Borrower or
such Subsidiary and is an arrangement or contract of the kind which would be
entered into by a prudent Person in the position of the Borrower or such
Subsidiary with a Person which is not one of its Affiliates.
SECTION 7.2.12 NEGATIVE PLEDGES, RESTRICTIVE AGREEMENTS, ETC. (a) The
Borrower will not, and will not permit any of its Subsidiaries to, enter into
any agreement (excluding this Agreement, any other Loan Document and Loan
Documents as defined in the Canadian Credit Agreement) prohibiting or
restricting the creation or assumption of any Lien upon its properties, revenues
or assets, whether now owned or hereafter acquired, or the ability of the
Borrower or any other Obligor to amend or otherwise modify this Agreement or any
other Loan Document or the ability of any Subsidiary to make any payments,
directly or indirectly, to the Borrower by way of dividends, advances,
repayments of loans or advances, reimbursements of management and other
intercompany charges, expenses and accruals or other returns on investments, or
any other agreement or arrangement which restricts the ability of any such
Subsidiary to make any payment, directly or indirectly, to the Borrower.
Notwithstanding the foregoing, (i) documents governing a Capitalized Lease
Liability or a purchase money Lien permitted by SECTION 7.2.3(q) and (r) may
prohibit other
68
Liens on the asset encumbered by such Lien, and (ii) the Lenders acknowledge
that certain real estate leases entered into by Borrower or its Subsidiaries
prior to the Effective Date restrict or prohibit Liens on the Borrower's or its
Subsidiary's leasehold interest.
(b) The Borrower will not, and will not permit any of its
Subsidiaries to, enter into any agreement governing Indebtedness if such
agreement contains covenants or events of default that are more restrictive than
those contained in this Agreement; PROVIDED, HOWEVER, that the foregoing
restriction shall not apply to the documents governing the Canadian Facility.
SECTION 7.2.13 AMENDMENTS TO INCENTIVE PAYMENTS AGREEMENT. The Borrower
will not amend or permit any amendment to the Incentive Payments Agreement or
any other agreement which would have the effect of increasing the amount of any
Incentive Payments or making such amounts due sooner, or which could otherwise
have an adverse effect on the Lenders' interests hereunder. The Borrower will
not permit any of its Subsidiaries to make any payments (either in cash or in
kind) under the Incentive Payments Agreement after the occurrence of and during
the continuation of any Default hereunder.
SECTION 7.2.14 USE OF PROCEEDS. No proceeds of any Loan will be used to
acquire any equity security of a class which is publicly traded or is registered
pursuant to Section 12 of the Securities Exchange Act of 1934 or any "margin
stock," as defined in Regulation U except in connection with transactions (a)
authorized by the board of directors of the Borrower, (b) either (i) authorized
by the board of directors or other governing body of the Person which stock is
being acquired or (ii) involving less than 5% of the stock of any Person (except
the Borrower) and (c) which would not cause the Borrower to fail to be in
compliance with SECTION 6.17 and which would not cause the Loans or the Lenders
to be in violation of Regulation U.
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".
SECTION 8.1.1 NON-PAYMENT OF OBLIGATIONS. The Borrower shall default in
the payment or prepayment when due of any principal of or interest on any Loan,
or the Borrower shall default (and such default shall continue unremedied for a
period of five days) in the payment when due of any Commitment Fee or of any
other Obligation.
SECTION 8.1.2 BREACH OF WARRANTY. Any representation or warranty of the
Borrower or any other Obligor made or deemed to be made hereunder or in any
other Loan Document executed by it or any other writing or certificate furnished
by or on behalf of the Borrower or any other Obligor to the Administrative Agent
or any Lender for the purposes of or in connection with this
69
Agreement or any such other Loan Document (including any certificates delivered
pursuant to ARTICLE V) is or shall be incorrect when made in any material
respect.
SECTION 8.1.3 NON-PERFORMANCE OF CERTAIN COVENANTS AND OBLIGATIONS. The
Borrower shall default in the due performance and observance of any of its
obligations under SECTION 7.1.1(d) or SECTION 7.2 which default continues
unremedied for ten (10) days.
SECTION 8.1.4 NON-PERFORMANCE OF OTHER COVENANTS AND OBLIGATIONS. Any
Obligor shall default in the due performance and observance of any other
agreement contained herein or in any other Loan Document executed by it, and
such default shall continue unremedied for a period of thirty (30) days after
notice thereof shall have been given to the Borrower by the Administrative Agent
or any Lender.
SECTION 8.1.5 DEFAULT UNDER SUBORDINATED NOTE DOCUMENTS OR ON OTHER
INDEBTEDNESS. (a) The Borrower or any of its Subsidiaries (i) fails to make any
payment when due (whether by scheduled maturity, required prepayment,
acceleration, demand or otherwise) in respect of any Indebtedness (other than
Indebtedness hereunder) having an aggregate principal amount (including undrawn
committed or available amounts and including amounts owing to all creditors
under any combined or syndicated credit arrangement) of more than $3,500,000, or
(ii) fails to observe or perform any other agreement or condition relating to
any such Indebtedness or contained in any instrument or agreement evidencing,
securing or relating thereto, or any other event occurs, the effect of which
default or other event is to cause, or to permit the holder or holders of such
Indebtedness or a trustee or agent on behalf of such holder or holders to cause,
with the giving of notice if required, such Indebtedness to be demanded or to
become due or to be repurchased or redeemed (automatically or otherwise) prior
to its stated maturity; or (b) an Event of Default occurs as defined in the
Canadian Agreement.
SECTION 8.1.6 JUDGMENTS.
(a) Any final judgment or order for the payment of money
in excess of $3,500,000 shall be rendered against the Borrower or any of its
Subsidiaries and either (i) enforcement proceedings shall have been commenced by
any creditor upon such judgment or order; or (ii) there shall be any period of
15 consecutive days during which a stay of enforcement of such judgment or
order, by reason of a pending appeal or otherwise, shall not be in effect.
(b) Any non-monetary final judgment shall be rendered
that has, or would reasonably be expected to have, a Material Adverse Effect
and, in either case, (i) enforcement proceedings are commenced by any creditor
upon such judgment or order, or (ii) there is a period of 15 consecutive days
during which a stay of enforcement of such judgment, by reason of a pending
appeal or otherwise, is not in effect.
70
SECTION 8.1.7 PENSION PLANS. Any of the following events shall occur
with respect to any Pension Plan (a) the institution of any steps by the
Borrower, any member of its Controlled Group or any other Person to terminate a
Pension Plan if, as a result of such termination, the Borrower or any such
member could be required to make a contribution to such Pension Plan, or could
reasonably expect to incur a liability or obligation to such Pension Plan, in
excess of $3,500,000; or (b) a contribution failure occurs with respect to any
Pension Plan sufficient to give rise to a Lien under section 302(f) of ERISA.
SECTION 8.1.8 CONTROL OF THE BORROWER. Any Change in Control shall
occur.
SECTION 8.1.9 BANKRUPTCY, INSOLVENCY, ETC. The Borrower or any of its
Subsidiaries shall (a) become insolvent or generally fail to pay, or admit in
writing its inability or unwillingness to pay, debts as they become due; (b)
apply for, consent to, or acquiesce in, the appointment of a trustee, receiver,
sequestrator or other custodian for the Borrower or any of its Subsidiaries or
any property of any thereof, or make a general assignment for the benefit of
creditors; (c) in the absence of such application, consent or acquiescence,
permit or suffer to exist the appointment of a trustee, receiver, sequestrator
or other custodian for the Borrower or any of its Subsidiaries or for a
substantial part of the property of any thereof, and such trustee, receiver,
sequestrator or other custodian shall not be discharged within 60 days,
PROVIDED, THAT the Borrower, each Subsidiary hereby expressly authorizes the
Administrative Agent and each Lender to appear in any court conducting any
relevant proceeding during such 60-day period to preserve, protect and defend
their rights under the Loan Documents; (d) permit or suffer to exist the
commencement of any bankruptcy, reorganization, debt arrangement or other case
or proceeding under any bankruptcy or insolvency law, or any dissolution,
winding up or liquidation proceeding, in respect of the Borrower or any of its
Subsidiaries or any other Obligor, and, if any such case or proceeding is not
commenced by the Borrower or such Subsidiary, such case or proceeding shall be
consented to or acquiesced in by the Borrower or such Subsidiary or shall result
in the entry of an order for relief or shall remain for 60 days undismissed,
PROVIDED, THAT the Borrower and each Subsidiary hereby expressly authorizes the
Administrative Agent and each Lender to appear in any court conducting any such
case or proceeding during such 60-day period to preserve, protect and defend
their rights under the Loan Documents; or (e) take any corporate or partnership
action authorizing, or in furtherance of, any of the foregoing.
SECTION 8.1.10 IMPAIRMENT OF SECURITY, ETC. Except as a direct result
of the acts or omissions of the Administrative Agent or any Lender, any Loan
Document, or any Lien granted thereunder, shall (except in accordance with its
terms), in whole or in part, terminate, cease to be effective or cease to be the
legally valid, binding and enforceable obligation of any Obligor party thereto;
the Borrower, any other Obligor or any other party shall, directly or
indirectly, contest in any manner such effectiveness, validity, binding nature
or enforceability; or for a period of ten days following the earlier of the date
the Borrower has knowledge thereof or the Borrower receives notice from the
Administrative Agent or any Lender thereof, any Lien securing any Obligation
shall, in
71
whole or in part, cease to be a perfected first priority Lien, subject only to
those exceptions expressly permitted by such Loan Document.
SECTION 8.1.11 DEFAULT UNDER MATERIAL AGREEMENT. The Borrower or any of
its Subsidiaries shall default in or breach the performance or observance of any
provision of any material contract or agreement to which it is a party or it or
its property is bound if such default or breach could result in the opinion of
the Administrative Agent and the Required Lenders in a Material Adverse Effect
and if such default or breach is not cured within thirty (30) days of the
Borrower's knowledge of such breach or default.
SECTION 8.1.12 INVALIDITY OF LOAN DOCUMENTS. Any Loan Document, at any
time after its execution and delivery and for any reason other than the
agreement of the requisite percentage of Lenders or satisfaction in full of all
the Obligations, ceases to be in full force and effect, or is declared by a
court of competent jurisdiction to be null and void, invalid or unenforceable in
any respect; or any Obligor denies that it has any or further liability or
obligation under any Loan Document, or purports to revoke, terminate, rescind or
invalidate any Loan Document in whole or in part.
SECTION 8.2 ACTION IF BANKRUPTCY. If any Event of Default described in
CLAUSES (a) through (d) of SECTION 8.1.9 shall occur with respect to the
Borrower or any Obligor, the Commitments (if not theretofore terminated) shall
automatically terminate and the outstanding principal amount of all outstanding
Loans and all other Obligations shall automatically be and become immediately
due and payable, without presentment, demand, protest, notice of intent to
accelerate, notice of acceleration, notice of any other kind or demand.
SECTION 8.3 ACTION IF OTHER EVENT OF DEFAULT. If any Event of Default
(other than any Event of Default described in CLAUSES (a) through (d) of SECTION
8.1.9 with respect to the Borrower or any other Obligor) shall occur for any
reason, whether voluntary or involuntary, and be continuing, the Administrative
Agent shall, upon the direction of, or may, with the consent of, the Required
Lenders, by notice to the Borrower (a) declare all or any portion of the
outstanding principal amount of the Loans and other Obligations to be due and
payable and/or the Commitments (if not theretofore terminated) to be terminated,
whereupon the full unpaid amount of such Loans and other Obligations which shall
be so declared due and payable shall be and become immediately due and payable,
without notice of intent to accelerate, notice of acceleration, notice of any
other kind, protest, demand or presentment, and/or, as the case may be, the
Commitments shall terminate; (b) require that the Borrower Cash Collateralize
its Obligations in respect of Letters of Credit in an amount equal to 110% of
the then aggregate Stated Amount of all Letters of Credit outstanding and
undrawn; and (c) exercise on behalf of itself and the Lenders all rights and
remedies available to it and the Lenders under the Loan Documents or applicable
law.
72
ARTICLE IX
THE AGENT
SECTION 9.1 ACTIONS. Each Lender hereby appoints BofA as its
Administrative Agent and Collateral Agent under and for purposes of this
Agreement, the Notes and each other Loan Document. Each Lender authorizes the
Administrative Agent to act on behalf of such Lender under this Agreement, the
Notes and each other Loan Document and, in the absence of other written
instructions from the Required Lenders received from time to time by the
Administrative Agent (with respect to which the Administrative Agent agrees that
it will comply, except as otherwise provided in this Section or as otherwise
advised by counsel), to exercise such powers hereunder and thereunder as are
specifically delegated to or required of the Administrative Agent by the terms
hereof and thereof, together with such powers as may be reasonably incidental
thereto. Each Lender hereby indemnifies (which indemnity shall survive any
termination of this Agreement) the Administrative Agent, PRO RATA according to
such Lender's Percentage, from and against any and all liabilities, obligations,
losses, damages, claims, costs or expenses of any kind or nature whatsoever
which may at any time be imposed on, incurred by, or asserted against, the
Administrative Agent in any way relating to or arising out of this Agreement,
the Notes and any other Loan Document, including reasonable attorneys' fees, and
as to which the Administrative Agent is not reimbursed by the Borrower; WHETHER
OR NOT ARISING OUT OF THE NEGLIGENCE OF THE ADMINISTRATIVE AGENT, PROVIDED,
HOWEVER, that no Lender shall be liable for the payment of any portion of such
liabilities, obligations, losses, damages, claims, costs or expenses which are
determined by a court of competent jurisdiction in a final proceeding to have
resulted solely from the Administrative Agent's gross negligence or wilful
misconduct. The Administrative Agent shall not be required to take any action
hereunder, under the Notes or under any other Loan Document, or to prosecute or
defend any suit in respect of this Agreement, the Notes or any other Loan
Document, unless it is indemnified hereunder to its satisfaction. If any
indemnity in favor of the Administrative Agent shall be or become, in the
Administrative Agent's determination, inadequate, the Administrative Agent may
call for additional indemnification from the Lenders and cease to do the acts
indemnified against hereunder until such additional indemnity is given.
SECTION 9.2 FUNDING RELIANCE, ETC. (a) Unless the Administrative Agent
shall have been notified by telephone, confirmed in writing, by any Lender by
10:30 p.m., Central time, on the day of a Borrowing that such Lender will not
make available the amount which would constitute its Percentage of such
Borrowing on the date specified therefor, the Administrative Agent may assume
that such Lender has made such amount available to the Administrative Agent and,
in reliance upon such assumption, make available to the Borrower a corresponding
amount. If and to the extent that such Lender shall not have made such amount
available to the Administrative Agent, such Lender and the Borrower severally
agree to repay the Administrative Agent forthwith on demand such corresponding
amount together with interest thereon, for each day from the date the
Administrative Agent made such amount available to the Borrower to the date such
amount is repaid to the Administrative Agent, at the Federal Funds Rate
applicable at the time.
73
(b) Unless the Administrative Agent shall have been
notified by telephone, confirmed in writing, by the Borrower prior to the date
any payment to be made by it hereunder is due, that it does not intend to remit
such payment, the Administrative Agent may, in its sole and absolute discretion,
assume that the Borrower has timely remitted such payment and may, in its sole
and absolute discretion and in reliance thereon, make available such payment to
the Person entitled thereto. If such payment is not in fact remitted to the
Administrative Agent in immediately available funds, then each Lender shall
forthwith on demand repay to the Administrative the amount of such assumed
payment made available to such Lender, together with interest thereon in respect
of each day from and including the date such amount was made by the
Administrative Agent to such Lender to the date such amount is repaid to the
Administrative Agent at the Federal Funds Rate.
SECTION 9.3 EXCULPATION. Neither the Administrative Agent nor any of
its directors, officers, employees or agents shall be liable to any Lender for
any action taken or omitted to be taken by it under this Agreement or any other
Loan Document, or in connection herewith or therewith, except for its own wilful
misconduct or gross negligence, nor responsible for any recitals or warranties
herein or therein, nor for the effectiveness, enforceability, validity or due
execution of this Agreement or any other Loan Document, nor for the creation,
perfection or priority of any Liens purported to be created by any of the Loan
Documents, or the validity, genuineness, enforceability, existence, value or
sufficiency of any collateral security, nor to make any inquiry respecting the
performance by the Borrower of its obligations hereunder or under any other Loan
Document. Any such inquiry which may be made by the Administrative Agent shall
not obligate it to make any further inquiry or to take any action. The
Administrative Agent shall be entitled to rely upon advice of counsel concerning
legal matters and upon any notice, consent, certificate, statement or writing
which the Administrative Agent believes to be genuine and to have been presented
by a proper Person.
SECTION 9.4 SUCCESSOR. The Administrative Agent may resign as such at
any time upon at least 30 days' prior notice to the Borrower and all Lenders. If
the Administrative Agent at any time shall resign, the Required Lenders may
appoint another Lender as a successor Administrative Agent which shall thereupon
become the Administrative Agent hereunder. If no successor Administrative Agent
shall have been so appointed by the Required Lenders, and shall have accepted
such appointment, within 30 days after the retiring Administrative Agent's
giving notice of resignation, then the retiring Administrative Agent may, on
behalf of the Lenders, appoint a successor Administrative Agent, which shall be
one of the Lenders or a commercial banking institution organized under the laws
of the U.S. (or any State thereof) or a U.S. branch or agency of a commercial
banking institution, and having a combined capital and surplus of at least
$500,000,000. Upon the acceptance of any appointment as Administrative Agent
hereunder by a successor Administrative Agent, such successor Administrative
Agent shall be entitled to receive from the retiring Administrative Agent such
documents of transfer and assignment as such successor Administrative Agent may
reasonably request, and shall thereupon succeed to and become vested with all
rights, powers, privileges and duties of the retiring Administrative Agent, and
the retiring Administrative Agent shall be discharged from its duties and
obligations under this Agreement.
74
After any retiring Administrative Agent's resignation hereunder as the
Administrative Agent, the provisions of (a) this ARTICLE IX shall inure to its
benefit as to any actions taken or omitted to be taken by it while it was the
Administrative Agent under this Agreement; and (b) SECTION 10.3 and SECTION 10.4
shall continue to inure to its benefit.
SECTION 9.5 LOANS BY BOFA. BofA shall have the same rights and powers
with respect to (x) the Loans made by it or any of its Affiliates, and (y) the
Notes held by it or any of its Affiliates as any other Lender and may exercise
the same as if it were not the Administrative Agent. BofA 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 Affiliate of the Borrower as if
BofA were not the Administrative Agent hereunder.
SECTION 9.6 CREDIT DECISIONS. Each Lender acknowledges that it has,
independently of the Administrative Agent and each other Lender, and based on
such Lender's review of the financial information of the Borrower, this
Agreement, the other Loan Documents (the terms and provisions of which being
satisfactory to such Lender) and such other documents, information and
investigations as such Lender has deemed appropriate, made its own credit
decision to extend its Commitments. Each Lender also acknowledges that it will,
independently of the Administrative Agent and each other Lender, and based on
such other documents, information and investigations as it shall deem
appropriate at any time, continue to make its own credit decisions as to
exercising or not exercising from time to time any rights and privileges
available to it under this Agreement or any other Loan Document.
SECTION 9.7 COPIES, ETC. The Administrative Agent shall give prompt
notice to each Lender of each notice or request required or permitted to be
given to the Administrative Agent by the Borrower pursuant to the terms of this
Agreement (unless concurrently delivered to the Lenders by the Borrower). The
Administrative Agent will distribute to each Lender each document or instrument
received for its account and copies of all other communications received by the
Administrative Agent from the Borrower for distribution to the Lenders by the
Administrative Agent in accordance with the terms of this Agreement.
SECTION 9.8 DEFAULT; COLLATERAL.
(a) Upon the occurrence and continuance of a Default, the
Lenders agree to promptly confer in order that Required Lenders or the Lenders,
as the case may be, may agree upon a course of action for the enforcement of the
rights of the Lenders; and the Administrative Agent shall be entitled to refrain
from taking any action (without incurring any liability to any Person for so
refraining) UNLESS and until the Administrative Agent shall have received
instructions from Required Lenders. All rights of action under the Loan
Documents and all right to the Collateral, if any, hereunder may be enforced by
the Administrative Agent and any suit or proceeding instituted by the
Administrative Agent in furtherance of such enforcement shall be brought in its
name as the Administrative Agent without the necessity of joining as plaintiffs
or defendants any other Lender,
75
and the recovery of any judgment shall be for the benefit of the Lenders (and,
with respect to Lender Hedging Agreements, Affiliates, if applicable) subject to
the expenses of the Administrative Agent. In actions with respect to any
property of the Borrower or any other Obligor, the Administrative Agent is
acting for the ratable benefit of each Lender (and, with respect to Lender
Hedging Agreement, Affiliates, if applicable). Any and all agreements to
subordinate (whether made heretofore or hereafter) other indebtedness or
obligations of Borrower to the Obligation shall be construed as being for the
ratable benefit of each Lender (and, with respect to Lender Hedging Agreement,
Affiliates, if applicable).
(b) Each Lender authorizes and directs the Administrative
Agent to enter into the Collateral Documents for the benefit of the Lenders
(and, with respect to Lender Hedging Agreement, Affiliates, if applicable).
EXCEPT to the extent unanimity (or other percentage set forth in SECTION 10.1)
is required hereunder, each Lender agrees that any action taken by the Required
Lenders in accordance with the provisions of the Loan Documents, and the
exercise by the Required Lenders of the power set forth herein or therein,
TOGETHER WITH such other powers as are reasonably incidental thereto, shall be
authorized and binding upon all of the Lenders.
(c) The Administrative Agent is hereby authorized on
behalf of all of the Lenders, without the necessity of any notice to or further
consent from any Lender, from time to time to take any action with respect to
any Collateral or Collateral Documents which may be necessary to perfect and
maintain perfected the Liens upon the collateral granted pursuant to the
Collateral Documents.
(d) The Administrative Agent shall have no obligation
whatsoever to any Lender or to any other Person to assure that the Collateral
exists or is owned by any Obligor or is cared for, protected, or insured or has
been encumbered or that the Liens granted to the Administrative Agent herein or
pursuant thereto have been properly or sufficiently or lawfully created,
perfected, protected, or enforced, or are entitled to any particular priority,
or to exercise at all or in any particular manner or under any duty of care,
disclosure, or fidelity, or to continue exercising, any of the Rights granted or
available to the Administrative Agent in this SECTION 9.8 or in any of the
Collateral Documents; IT BEING UNDERSTOOD and agreed that in respect of the
Collateral, or any act, omission, or event related thereto, the Administrative
Agent any act in any manner it may deem appropriate, in its sole discretion,
given the Administrative Agent's own interest in the Collateral as one of the
Lenders and that the Administrative Agent shall have no duty or liability
whatsoever to any Lender, OTHER THAN to act without gross negligence or willful
misconduct.
(e) The Lenders hereby irrevocably authorize the
Administrative Agent, at its option and in its discretion, to release any Lien
granted to or held by the Administrative Agent upon any Collateral: (i)
constituting property in which no Obligor owned an interest at the time the Lien
was granted or at any time thereafter; (ii) constituting property leased to an
Obligor under a lease which has expired or been terminated in a transaction
permitted under the Loan Document or is about to expire and which has not been,
and is not intended by such Obligor to be, renewed; and (iii) consisting of an
instrument evidencing Indebtedness pledged to the Administrative Agent (for the
76
benefit of the Lenders), if the Indebtedness evidenced thereby has been paid in
full. In addition, the Lenders irrevocably authorize the Administrative Agent to
release Liens upon collateral as contemplated in SECTION 10.1(b), (c) or (d), or
if approved, authorized, or ratified in writing by the requisite Lenders. Upon
request by the Administrative Agent at any time, the Lenders will confirm in
writing the Administrative Agent's authority to release particular types or
items of Collateral pursuant to this SECTION 9.8.
(f) In furtherance of the authorizations set forth in
this SECTION 9.8, each Lender hereby irrevocably appoints the Administrative
Agent its attorney-in-fact, with full power of substitution, for and on behalf
of and in the name of each such Lender, (i) to enter into Collateral Documents
(including, without limitation, any appointments of substitute trustees under
any Collateral Documents), (ii) to take action with respect to the Collateral
and Collateral Documents to perfect, maintain, and preserve Lenders' Liens, and
(iii) to execute instruments of release or to take other action necessary to
release Liens upon any Collateral to the extent authorized in paragraph (e)
hereof. This power of attorney shall be liberally, not restrictively, construed
so as to give the greatest latitude to the Administrative Agent's power, as
attorney, relative to the Collateral matters described in this SECTION 9.8. The
powers and authorities herein conferred on the Administrative Agent may be
exercised by the Administrative Agent through any Person who, at the time of the
execution of a particular instrument, is an officer of the Administrative Agent.
The power of attorney conferred by this SECTION 9.8(f) is granted for valuable
consideration and is coupled with an interest and is irrevocable so LONG as the
Obligations, or any part thereof, shall remain unpaid or the Lenders are
obligated to make any Borrowings under the Loan Documents.
SECTION 9.9 LENDER HEDGING AGREEMENTS. To the extent any Lender or any
Affiliate of a Lender is a party to a Lender Hedging Agreement in accordance
with the requirements of the Loan Documents and accepts the benefits of the
Liens in the Collateral arising pursuant to the Collateral Documents, such
Lender (for itself and on behalf of any such Affiliates) shall be deemed (i) to
appoint Bank of America, N.A., as its nominee and agent, to act for and on
behalf of such Lender or Affiliate thereof in connection with the Collateral
Documents and (ii) to be bound by the terms of this ARTICLE IX.
ARTICLE X
MISCELLANEOUS PROVISIONS
SECTION 10.1 WAIVERS, AMENDMENTS, RELEASE OF COLLATERAL, ETC. (a) The
provisions of this Agreement and of each other Loan Document may from time to
time be amended, modified or waived, if such amendment, modification or waiver
is in writing and consented to by the Borrower and the Required Lenders;
PROVIDED, HOWEVER, that no such amendment, modification or waiver which would:
(a) modify any requirement hereunder that any particular action be taken by all
the Lenders or by the Required Lenders shall be effective unless consented to by
each Lender; (b) modify this SECTION 10.1, change the definition of "REQUIRED
LENDERS," increase any Commitment Amount (except as set forth in SECTION 2.5.1)
or the Percentage of any Lender, reduce any fees
77
described in ARTICLE III, change the schedule of reductions to the Commitments
provided for in SECTION 2.2.2, release any material portion of the Collateral,
except as set forth in SECTION 9.8 and SECTIONS 10.1(b), (c) and (d) or
otherwise specifically provided in any Loan Document, release any material
Guarantor (except as provided in SECTION 10.1(d)), or extend any Commitment
Termination Date, shall be made without the consent of each Lender and each
holder of a Note; (c) extend the due date for, or reduce the amount of, any
scheduled repayment or prepayment of principal of or interest on any Loan (or
reduce the principal amount of or rate of interest on any Loan) shall be made
without the consent of the holder of that Note evidencing such Loan; (d) affect
adversely the interests, rights or obligations of the Administrative Agent,
shall be made without consent of the Administrative Agent; or (e) affect
adversely the interests, rights or obligations of an Issuer in its capacity as
such, shall be made without consent of such Issuer. No failure or delay on the
part of the Administrative Agent, any Lender or the holder of any Note in
exercising any power or right under this Agreement or any other Loan Document
shall operate as a waiver thereof, nor shall any single or partial exercise of
any such power or right preclude any other or further exercise thereof or the
exercise of any other power or right. No notice to or demand on the Borrower in
any case shall entitle it to any notice or demand in similar or other
circumstances. No waiver or approval by the Administrative Agent, any Lender or
the holder of any Note under this Agreement or any other Loan Document shall,
except as may be otherwise stated in such waiver or approval, be applicable to
subsequent transactions. No waiver or approval hereunder shall require any
similar or dissimilar waiver or approval thereafter to be granted hereunder.
(b) Upon any sale, transfer, or disposition of Collateral
which is permitted pursuant to the Loan Documents, and upon ten (10) Business
Days' prior written request by the Borrower (which request must be accompanied
by (a) true and correct copies of all material documents of transfer or
disposition, including any contract of sale, (ii) a preliminary closing
statement and instructions to the title company, if any, and (iii) all requested
release instruments in form and substance satisfactory to the Administrative
Agent), the Administrative Agent shall (and is hereby irrevocably authorized by
the Lenders to) execute such documents as may be necessary to evidence the
release of Liens granted to the Administrative Agent for the benefit of the
Lenders pursuant hereto in such Collateral. In addition, if the Borrower or any
of its Subsidiaries own any Margin Stock at the time of the requested release,
then together with such request for release, the Borrower shall present a
certificate in form and substance satisfactory to the Administrative Agent,
setting forth calculations demonstrating compliance with Regulation U and, if
required by the Administrative Agent, an opinion of counsel stating that the
requested release, if made, will not result in the Lenders being in violation of
Regulation U. The Administrative Agent shall not be required to execute any
release instruments on terms which, in the Administrative Agent's opinion, would
expose the Administrative Agent to liability or create any obligation or entail
any consequence other than the release of liens without recourse or warranty. No
such release shall impair the Administrative Agent's lien on the proceeds of
sale of such Collateral.
(c) If all outstanding Loans and other Obligations have
been indefeasibly paid in full and no Letters of Credit are outstanding, the
Commitments have terminated or have been
78
reduced to zero pursuant to SECTION 2.2, and, subject to SECTION 10.1(d), all
Lender Hedging Agreements have terminated, the Administrative Agent agrees to,
and the Lenders hereby instruct the Administrative Agent to, at the Borrower's
expense, execute such releases of the Collateral Documents as the Borrower shall
reasonably request and this Agreement shall be deemed terminated except that
such termination shall not relieve the Borrower of any obligation to make any
payments to the Administrative Agent or any Lender required by any Loan Document
to the extent accruing, or relating to an event occurring, prior to such
termination. Notwithstanding the foregoing, if such Liens also secure the
obligations under the Canadian Credit Agreement, such Liens may not be released
unless permitted by the terms of the Canadian Credit Agreement.
(d) Notwithstanding any provision herein to the contrary,
if the Commitments as herein defined and as defined in the Canadian Credit
Agreement have been terminated, no Letters of Credit hereunder or under the
Canadian Credit Agreement are outstanding, and the only outstanding Obligations
as herein defined and as defined in the Canadian Credit Agreement are amounts
owed pursuant to one or more Lender Hedging Agreements, the Administrative Agent
will, and is hereby authorized to, (A) release the Liens created under the Loan
Documents and (B) release all Guaranties executed by Subsidiaries of the
Borrower, provided, that contemporaneously with such release, (i) the Borrower
(and, if applicable, the Subsidiary that is a party to such Lender Hedging
Agreements) (A) executes a margin agreement in form and substance acceptable to
such Lender(s) (or its Affiliates) that are parties to such Lender Hedging
Agreements (the "LENDER COUNTERPARTIES") and (B) provides collateral in the form
of cash or a letter of credit having an aggregate value acceptable to such
Lender Counterparties, and (ii) if such Lender Hedging Agreement is executed by
a Subsidiary of the Borrower but the Borrower is not a party thereto, the
Borrower executes a guaranty covering such Subsidiary's obligations thereunder,
such guaranty to be in form and substance satisfactory to the Lender
Counterparties; and PROVIDED FURTHER the Borrower acknowledges that if such
liens and/or Guaranties also secure the obligations under the Canadian Credit
Agreement, such Liens and Guaranties may not be released unless permitted by the
terms of the Canadian Credit Agreement. Any release under this SECTION 10.1(d)
must be in writing and signed by the Administrative Agent.
SECTION 10.2 NOTICES. All notices and other communications provided to
any party hereto under this Agreement or any other Loan Document shall be in
writing or by facsimile and addressed, delivered or transmitted to such party at
its address, Telex or facsimile number set forth, with respect to Borrower and
Administrative Agent, below its signature hereto, and with respect to any
Lender, set forth on SCHEDULE IV hereto or set forth in the Lender Assignment
Agreement, or at such other address or facsimile number as may be designated by
such party in a notice to the other parties. Any notice, if mailed and properly
addressed with postage prepaid or if properly addressed and sent by pre-paid
courier service, shall be deemed given when received; any notice, if transmitted
by facsimile, shall be deemed given when transmitted.
SECTION 10.3 PAYMENT OF COSTS AND EXPENSES. The Borrower agrees to pay
within 10 days of demand all reasonable expenses of the Administrative Agent
(including the fees and out-
79
of-pocket expenses of counsel to the Administrative Agent and of local counsel,
if any, who may be retained by counsel to the Administrative Agent) in
connection with the negotiation, preparation, execution and delivery of this
Agreement and of each other Loan Document, including schedules and exhibits, and
any amendments, waivers, consents, supplements or other modifications to this
Agreement or any other Loan Document as may from time to time hereafter be
required, whether or not the transactions contemplated hereby are consummated,
the filing, recording, refiling or rerecording of any mortgage, any pledge
agreement and any Security Agreement and/or any Uniform Commercial Code
financing statements relating thereto and all amendments, supplements and
modifications to 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 any mortgage, any pledge agreement or any security
agreement, and the preparation and review of the form of any document or
instrument relevant to this Agreement or any other Loan Document.
The Borrower further agrees to pay, and to save the
Administrative Agent and the Lenders harmless from all liability for, any stamp
or other similar taxes which may be payable in connection with the execution or
delivery of this Agreement, the borrowings hereunder, or the issuance of the
Notes or any other Loan Documents. The Borrower also agrees to reimburse the
Administrative Agent and each Lender upon demand for all reasonable
out-of-pocket expenses (including attorneys' fees and legal expenses) incurred
by the Administrative Agent or such Lender in connection with the enforcement of
any Obligations.
SECTION 10.4 INDEMNIFICATION. In consideration of the execution and
delivery of this Agreement by each Lender and the extension of the Commitments,
the Borrower hereby indemnifies, exonerates and holds the Administrative Agent
and any of its Affiliates and each Lender and each of their respective officers,
directors, employees, attorneys and agents (collectively, the "INDEMNIFIED
PARTIES") free and harmless from and against any and all actions, causes of
action, suits, losses, costs, liabilities and damages, and expenses incurred in
connection therewith (irrespective of whether any such Indemnified Party is a
party to the action for which indemnification hereunder is sought), including
reasonable attorneys' fees and disbursements and settlement costs INCLUDING
INDEMNIFIED LIABILITIES ARISING OUT OF THE NEGLIGENCE OF AN INDEMNIFIED PARTY
(collectively, the "INDEMNIFIED LIABILITIES"), incurred by the Indemnified
Parties or any of them as a result of, or arising out of, or relating to (a) any
transaction financed or to be financed in whole or in part, directly or
indirectly, with the proceeds of any Loan; (b) the entering into and performance
of this Agreement and any other Loan Document by any of the Indemnified Parties;
(c) any investigation, litigation or proceeding related to any acquisition or
proposed acquisition by the Borrower or any of its Subsidiaries of all or any
portion of the stock or assets of any Person, whether or not the Administrative
Agent or such Lender is party thereto; (d) any investigation, litigation or
proceeding related to any environmental cleanup, audit, compliance or other
matter relating to the protection of the environment or the Release by the
Borrower or any of its Subsidiaries of any Hazardous Material; or (e) the
presence on or under, or the escape, seepage, leakage, spillage, discharge,
emission, discharging or releases from, any real property owned or operated by
the Borrower or any Subsidiary thereof of any Hazardous Material (including any
losses,
80
liabilities, damages, injuries, costs, expenses or claims asserted or arising
under any Environmental Law), regardless of whether caused by, or within the
control of, the Borrower or such Subsidiary, except for any such Indemnified
Liabilities arising for the account of a particular Indemnified Party by reason
of the relevant Indemnified Party's gross negligence or wilful misconduct.
SECTION 10.5 SURVIVAL. The obligations of the Borrower under SECTIONS
4.3, 4.4, 4.5, 4.6, 10.3 and 10.4, and the obligations of the Lenders under
SECTION 9.1, shall in each case survive any termination of this Agreement, the
payment in full of all Obligations and the termination of all Commitments. The
representations and warranties made by each Obligor in this Agreement and in
each other Loan Document shall survive the execution and delivery of this
Agreement and each such other Loan Document.
SECTION 10.6 SEVERABILITY. Any provision of this Agreement or any other
Loan Document which is prohibited or unenforceable in any jurisdiction shall, as
to such provision and such jurisdiction, be ineffective to the extent of such
prohibition or unenforceability without invalidating the remaining provisions of
this Agreement or such Loan Document or affecting the validity or enforceability
of such provision in any other jurisdiction.
SECTION 10.7 HEADINGS. The various headings of this Agreement and of
each other Loan Document are inserted for convenience only and shall not affect
the meaning or interpretation of this Agreement or such other Loan Document or
any provisions hereof or thereof.
SECTION 10.8 EXECUTION IN COUNTERPARTS. This Agreement may be executed
by the parties hereto in several counterparts, each of which shall be executed
by the Borrower and the Administrative Agent and be deemed to be an original and
all of which shall constitute together but one and the same agreement.
SECTION 10.9 GOVERNING LAW; ENTIRE AGREEMENT. THIS AGREEMENT, THE NOTES
AND EACH OTHER LOAN DOCUMENT SHALL EACH BE DEEMED TO BE A CONTRACT MADE UNDER
AND GOVERNED BY THE INTERNAL LAWS OF THE STATE OF TEXAS AND APPLICABLE U.S.
FEDERAL LAW. This Agreement, the Notes and the other Loan Documents constitute
the entire understanding among the parties hereto with respect to the subject
matter hereof and supersede any prior agreements, written or oral, with respect
thereto.
SECTION 10.10 SUCCESSORS AND ASSIGNS. This Agreement shall be binding
upon and shall inure to the benefit of the parties hereto and their respective
successors and assigns; PROVIDED, HOWEVER, that: the Borrower may not assign or
transfer its rights or obligations hereunder without the prior written consent
of the Administrative Agent and all Lenders; and the rights of sale, assignment
and transfer of the Lenders are subject to SECTION 10.11.
81
SECTION 10.11 SALE AND TRANSFER OF LOANS AND NOTES; PARTICIPATIONS IN
LOANS AND NOTES. Each Lender may assign, or sell participations in, its Loans
and Commitments to one or more other Persons in accordance with this SECTION
10.11.
SECTION 10.11.1 ASSIGNMENTS. Any Lender, (a) with the written consents
of the Administrative Agent and, so long as no Event of Default has occurred and
is continuing, the Borrower (which consents shall not be unreasonably delayed or
withheld and which consent, in the case of the Borrower, shall be deemed to have
been given in the absence of a written notice delivered by the Borrower to the
Administrative Agent, on or before the fifth Business Day after receipt by the
Borrower of such Lender's request for consent, stating, in reasonable detail,
the reasons why the Borrower proposes to withhold such consent) may at any time
assign and delegate to one or more commercial banks or other financial
institutions, and (b) with notice to the Borrower and the Administrative Agent,
but without the consent of the Borrower or the Administrative Agent, may assign
and delegate to any of its Affiliates or to any other Lender (each Person
described in either of the foregoing clauses as being the Person to whom such
assignment and delegation is to be made, being hereinafter referred to as an
"ASSIGNEE LENDER"), all or any fraction of such Lender's total Loans and
Commitments (which assignment and delegation shall be of a constant, and not a
varying, percentage of all the assigning Lender's Loans and Commitments) in a
minimum aggregate amount of $5,000,000; PROVIDED, HOWEVER, that any such
assignments by a Lender shall be pro rata with any assignment by such Lender or
an Affiliate of such Lender of its interests in the Canadian Facility; and
provided FURTHER THAT any such Assignee Lender will comply, if applicable, with
the provisions contained in the last sentence of SECTION 4.6 and FURTHER,
PROVIDED, HOWEVER, that, the Borrower, each other Obligor and the Administrative
Agent shall be entitled to continue to deal solely and directly with such Lender
in connection with the interests so assigned and delegated to an Assignee Lender
until (c) written notice of such assignment and delegation, together with
payment instructions, addresses and related information with respect to such
Assignee Lender, shall have been given to the Borrower and the Administrative
Agent by such Lender and such Assignee Lender, (d) such Assignee Lender shall
have executed and delivered to the Borrower and the Administrative Agent a
Lender Assignment Agreement, accepted by the Administrative Agent, and (e) the
processing fees described below shall have been paid. From and after the date
that the Administrative Agent accepts such Lender Assignment Agreement, (x) the
Assignee Lender thereunder shall be deemed automatically to have become a party
hereto and to the extent that rights and obligations hereunder have been
assigned and delegated to such Assignee Lender in connection with such Lender
Assignment Agreement, shall have the rights and obligations of a Lender
hereunder and under the other Loan Documents, and (y) the assignor Lender, to
the extent that rights and obligations hereunder have been assigned and
delegated by it in connection with such Lender Assignment Agreement, shall be
released from its obligations hereunder and under the other Loan Documents.
Within five (5) Business Days after its receipt of notice that the
Administrative Agent has received an executed Lender Assignment Agreement, the
Borrower shall execute and deliver to the Administrative Agent (for delivery to
the relevant Assignee Lender) new Notes evidencing such Assignee Lender's
assigned Loans and Commitments and, if the assignor Lender has retained Loans
and Commitments hereunder, replacement Notes in the principal amount of the
Loans and
82
Commitments retained by the assignor Lender hereunder (such Notes to be in
exchange for, but not in payment of, those Notes then held by such assignor
Lender). Each such Note shall be dated the date of the predecessor Notes. The
assignor Lender shall ▇▇▇▇ the predecessor Notes "exchanged" and deliver them to
the Borrower. Accrued interest on that part of the predecessor Notes evidenced
by the new Notes, if any, shall be paid as provided in the Lender Assignment
Agreement. Accrued interest on that part of the predecessor Notes evidenced by
the replacement Notes shall be paid to the assignor Lender. Accrued interest and
accrued fees shall be paid at the same time or times provided in the predecessor
Notes and in this Agreement. Such assignor Lender or such Assignee Lender must
also pay a processing fee to the Administrative Agent upon delivery of any
Lender Assignment Agreement in the amount of $3,500. Any attempted assignment
and delegation not made in accordance with this SECTION 10.11.1 shall be null
and void.
SECTION 10.11.2 PARTICIPATIONS. Any Lender may at any time sell to one
or more commercial banks or other Persons (each of such commercial banks and
other Persons being herein called a "PARTICIPANT") participating interests in
any of the Loans, Commitments, or other interests of such Lender hereunder;
PROVIDED, HOWEVER, that (a) no participation contemplated in this SECTION 10.11
shall relieve such Lender from its Commitments or its other obligations
hereunder or under any other Loan Document, (b) such Lender shall remain solely
responsible for the performance of its Commitments and such other obligations,
(c) the Borrower and the Administrative Agent shall continue to deal solely and
directly with such Lender in connection with such Lender's rights and
obligations under this Agreement and each of the other Loan Documents, (d) no
Participant, unless such Participant is an Affiliate of such Lender, or is
itself a Lender, shall be entitled to require such Lender to take or refrain
from taking any action hereunder or under any other Loan Document, except that
such Lender may agree with any Participant that such Lender will not, without
such Participant's consent, take any actions of the type described in CLAUSE (b)
or (c) of SECTION 10.1, and (e) the Borrower shall not be required to pay any
amount under SECTION 4.6 that is greater than the amount which it would have
been required to pay had no participating interest been sold. Subject to the
above, the Borrower acknowledges and agrees that each Participant, for purposes
of SECTIONS 4.3, 4.4, 4.5, 4.6, 4.8, 10.3 and 10.4, shall be considered a
Lender.
SECTION 10.12 OTHER TRANSACTIONS. Nothing contained herein shall
preclude the Administrative Agent or any other Lender from engaging in any
transaction, in addition to those contemplated by this Agreement or any other
Loan Document, with the Borrower or any of its Affiliates in which the Borrower
or such Affiliate is not restricted hereby.
SECTION 10.13 FORUM SELECTION AND CONSENT TO JURISDICTION. ANY
LITIGATION BASED HEREON, OR ARISING OUT OF, UNDER, OR IN CONNECTION WITH, THIS
AGREEMENT OR ANY OTHER LOAN DOCUMENT, OR ANY COURSE OF CONDUCT, COURSE OF
DEALING, STATEMENTS (WHETHER VERBAL OR WRITTEN) OR ACTIONS OF THE ADMINISTRATIVE
AGENT, THE LENDERS OR THE BORROWER MAY BE BROUGHT AND MAINTAINED IN THE COURTS
OF THE STATE OF TEXAS OR IN THE UNITED STATES DISTRICT COURT FOR THE SOUTHERN
DISTRICT OF TEXAS. THE BORROWER HEREBY EXPRESSLY AND IRREVOCABLY SUBMITS TO THE
JURISDICTION OF THE COURTS OF THE STATE OF TEXAS AND OF THE UNITED STATES
DISTRICT COURT FOR THE SOUTHERN DISTRICT OF
83
TEXAS FOR THE PURPOSE OF ANY SUCH LITIGATION AS SET FORTH ABOVE AND IRREVOCABLY
AGREES TO BE BOUND BY ANY JUDGMENT RENDERED THEREBY IN CONNECTION WITH SUCH
LITIGATION. THE BORROWER FURTHER IRREVOCABLY CONSENTS TO THE SERVICE OF PROCESS
BY PERSONAL SERVICE WITHIN OR WITHOUT THE STATE OF TEXAS. THE BORROWER HEREBY
EXPRESSLY AND IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY LAW, ANY
OBJECTION WHICH IT MAY HAVE OR HEREAFTER MAY HAVE TO THE LAYING OF VENUE OF ANY
SUCH LITIGATION BROUGHT IN ANY SUCH COURT REFERRED TO ABOVE AND ANY CLAIM THAT
ANY SUCH LITIGATION HAS BEEN BROUGHT IN AN INCONVENIENT FORUM.
SECTION 10.14 WAIVER OF JURY TRIAL. THE ADMINISTRATIVE AGENT, THE
LENDERS AND THE BORROWER HEREBY KNOWINGLY, VOLUNTARILY AND INTENTIONALLY WAIVE
ANY RIGHTS THEY MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY LITIGATION BASED
HEREON, OR ARISING OUT OF, UNDER, OR IN CONNECTION WITH, THIS AGREEMENT OR ANY
OTHER LOAN DOCUMENT, OR ANY COURSE OF CONDUCT, COURSE OF DEALING, STATEMENTS
(WHETHER VERBAL OR WRITTEN) OR ACTIONS OF THE ADMINISTRATIVE AGENT, THE LENDERS
OR THE BORROWER. THE BORROWER ACKNOWLEDGES AND AGREES THAT IT HAS RECEIVED FULL
AND SUFFICIENT CONSIDERATION FOR THIS PROVISION (AND EACH OTHER PROVISION OF
EACH OTHER LOAN DOCUMENT TO WHICH IT IS A PARTY) AND THAT THIS PROVISION IS A
MATERIAL INDUCEMENT FOR THE ADMINISTRATIVE AGENT AND THE LENDERS ENTERING INTO
THIS AGREEMENT AND EACH SUCH OTHER LOAN DOCUMENT.
SECTION 10.15 CONFIDENTIALITY. Each Lender and the Administrative Agent
agrees to use reasonable commercial efforts not to disclose without the prior
written consent of the Borrower (other than to their employees, auditors or
counsel or to another Lender if the Lender or such Lender's holding or parent
company or the Administrative Agent in its sole discretion determines that any
such party should have access to such information) any confidential information
with respect to the Borrower or any Subsidiary which is furnished pursuant to
this Agreement, PROVIDED, THAT any Lender and the Administrative Agent may
disclose any such information (a) as has become generally available to the
public, (b) as may be required or appropriate in any report, statement or
testimony submitted to any municipal, provincial, state or Federal regulatory
body having or claiming to have jurisdiction over such Lender or the
Administrative Agent or to the Federal Reserve Board, Bank of Canada, the Office
of the Superintendent of Financial Institutions, Canada Deposit Insurance
Corporation, the Federal Deposit Insurance Corporation, National Association of
Insurance Commissioners or similar organizations (whether in the United States
or elsewhere) or their successors, (c) as may be required or appropriate in
response to any summons or subpoena or in
84
connection with any litigation, (d) in order to comply with any law, order,
regulation or ruling applicable to such Lender or the Administrative Agent, and
(e) to any Affiliate of such Lender or Administrative Agent.
A Lender may furnish any publicly available information
concerning the Borrower or any of its Subsidiaries in the possession of such
Lender from time to time to assignees and participants (including prospective
assignees and participants) without the consent of the Borrower. Nonpublic
information concerning the Borrower or any of its Subsidiaries shall not be
furnished by any Lender to assignees and participants (including prospective
assignees and participants) without the prior written consent of the Borrower,
which consent shall not be unreasonably withheld or delayed.
SECTION 10.16 ASSIGNMENT. Bank of America, N.A., as holder of the Notes
as defined in and issued under the Existing Credit Agreement, hereby assigns to
the Lenders who are signatories hereto on the Effective Date, a portion of the
indebtedness owed to it under the Existing Credit Agreement, so that on the
Effective Date all such Lenders have Commitments and hold Loans in the
Percentages set forth on SCHEDULE V hereto.
SECTION 10.17 PRIORITY OF HEDGING OBLIGATIONS. Borrower, Lenders and
Administrative Agent hereby agree that (a) any amounts received in satisfaction
of any Obligations arising under the Loan Documents, including, without
limitation, Obligations under this Agreement and any Lender Hedging Agreement,
shall rank PARI PASSU in right of payment and shall be used to repay such
Obligations on a pro rata basis, and (b) except as otherwise set forth in
SECTION 10.17(i) above, all Hedging Obligations arising in connection with any
Hedging Agreement are hereby expressly subordinated in right of payment to the
prior payment in full in cash of all Obligations under the Loan Documents, other
than any Lender Hedging Agreement.
SECTION 10.18 CERTAIN REMEDIES. Notwithstanding anything to the
contrary contained herein or in the Collateral Documents, neither the
Administrative Agent nor the Lenders shall have the right to collect income,
rents, royalties, revenues, issues, profits or proceeds from the Mortgaged
Properties as therein defined unless an Event of Default has occurred and is
continuing.
SECTION 10.19 MAXIMUM RATE. It is the intention of the parties hereto
to comply strictly with applicable usury laws, if any; accordingly,
notwithstanding any provision to the contrary contained herein or in any fee
letter or other Loan Document or any other document otherwise relating hereto,
in no event shall this Agreement or any Note or such documents require or permit
the payment, taking, reserving, receiving, collection or charging of any sums
constituting interest under applicable laws which exceed the maximum amount
permitted by such laws. If any such excess interest is called for, contracted
for, charged, taken, reserved, or received in connection with any Loan or in any
fee letter or other Loan Document, or in any communication by the Administrative
Agent, any Lender or any other person to the Borrower or any other person, or in
the event all or part of the principal or interest of any Loan shall be prepaid
or accelerated, so that under any of such
85
circumstances or under any other circumstance whatsoever the amount of interest
contracted for, charged, taken, reserved, or received on the amount of principal
actually outstanding from time to time under this Agreement or any Note shall
exceed the maximum amount of interest permitted by applicable usury laws, then
in any such event it is agreed as follows: (i) the provisions of this paragraph
shall govern and control, (ii) neither the Borrower nor any other person or
entity now or hereafter liable for the payment of any Loan shall be obligated to
pay the amount of such interest to the extent such interest is in excess of the
maximum amount of interest permitted by applicable usury laws, (iii) any such
excess which is or has been received notwithstanding this paragraph shall be
credited against the then unpaid principal balance of the Loans or, if the Loans
have been or would be paid in full by such credit, refunded to the Borrower, and
(iv) the provisions of this Agreement, the Notes and the other Loan Documents,
and any communication to the Borrower, shall immediately be deemed reformed and
such excess interest reduced, without the necessity of executing any other
document, to the maximum lawful rate allowed under applicable laws as now or
hereafter construed by courts having jurisdiction hereof or thereof. Without
limiting the foregoing, all calculations of the rate of interest contracted for,
charged, collected, taken, reserved, or received in connection herewith which
are made for the purpose of determining whether such rate exceeds the maximum
lawful rate shall be made to the extent permitted by applicable laws by
amortizing, prorating, allocating and spreading during the period of the full
term of the Loans, including all prior and subsequent renewals and extensions,
all interest at any time contracted for, charged, taken, collected, reserved, or
received. The terms of this paragraph shall be deemed to be incorporated in
every Loan Document and communication relating to this Agreement, the Loans and
the Notes.
To the extent that the interest rate laws of the State of
Texas are applicable to the Loans, the applicable interest rate ceiling is the
weekly ceiling (formerly the indicated rate ceiling) determined in accordance
with Tex. Rev. Civ. Stat., Title 79, Article 5069-1D.003, also codified at Texas
Finance Code, Section 303.301 (formerly Article 5069-1.04 (a)(1)), and, to the
extent that this Agreement is deemed an open end account as such term is defined
in Tex. Rev. Civ. Stat., Title 79, Article 5069-1B.002(14), also codified at
Texas Finance Code Section 301.001(3) (formerly Article 5069-1.01(f)), the
Lenders retain the right to modify the interest rate in accordance with
applicable law.
The parties agree that Texas Finance Code, Chapter 346
(formerly Tex. Rev. Civ. Stat., Title 79, Chapter 15), which regulates certain
revolving loan accounts and revolving triparty accounts, shall not apply to any
revolving loan accounts created under this Agreement or the Notes or maintained
in connection therewith.
86
SECTION 10.20 ENTIRE AGREEMENT.
THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS REPRESENT THE
FINAL AGREEMENT BETWEEN THE PARTIES AND MAY NOT BE CONTRADICTED BY EVIDENCE OF
PRIOR, CONTEMPORANEOUS, OR SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES. THERE ARE
NO UNWRITTEN ORAL AGREEMENTS BETWEEN THE PARTIES.
[SIGNATURES BEGIN ON FOLLOWING PAGE]
87
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be executed by their respective officers thereunto duly authorized
as of the day and year first above written.
MARKWEST HYDROCARBON, INC.
By:
---------------------------------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Vice President, Finance
Address for Notices: ▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Telephone No: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: Contract Administrator
S-1
BANK OF AMERICA, N.A., as Administrative Agent
By:
---------------------------------------------
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Vice President
Address for Notices: ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇,
▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇. ▇▇▇▇▇ ▇▇▇▇▇▇
with a copy to:
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile No: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇. ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
S-2
LENDERS
BANK OF AMERICA, N.A.
By:
---------------------------------------------
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Vice President
S-3
U.S. BANK, NATIONAL ASSOCIATION
By:
---------------------------------------------
Name:
Title:
S-4