EXHIBIT 10.1
EXECUTION COPY
UNCOMMITTED AMENDED AND RESTATED CREDIT AGREEMENT
DATED TO BE EFFECTIVE AS OF JULY 1, 2002
AMONG
▇▇▇▇▇▇▇▇ MARKETING, L.L.C.,
AS BORROWER,
FORTIS CAPITAL CORP.,
AS ADMINISTRATIVE AGENT, COLLATERAL AGENT, AN ISSUING BANK, AND A BANK,
BNP PARIBAS,
AS DOCUMENTATION AGENT, AN ISSUING BANK, AND A BANK
AND
THE OTHER FINANCIAL INSTITUTIONS WHICH
MAY BECOME PARTIES HERETO
THIS AGREEMENT PROVIDES FOR AN
UNCOMMITTED FACILITY WITH A DEMAND FEATURE.
ALL ADVANCES AND ISSUANCES OF LETTERS OF CREDIT
ARE DISCRETIONARY ON THE PART OF THE BANKS
IN THEIR SOLE AND ABSOLUTE DISCRETION.
THE BANKS MAY MAKE DEMAND FOR PAYMENT AT ANY TIME
IN THEIR SOLE AND ABSOLUTE DISCRETION.
UNCOMMITTED AMENDED AND RESTATED CREDIT AGREEMENT
This UNCOMMITTED AMENDED AND RESTATED CREDIT AGREEMENT (the
"Agreement") is entered into effective as of July 1, 2002, among ▇▇▇▇▇▇▇▇
MARKETING, L.L.C., a Delaware limited liability company (the "Borrower"), FORTIS
CAPITAL CORP., a Connecticut corporation ("Fortis"), as a Bank, as an Issuing
Bank, and as Administrative Agent for the Banks (in such capacity, the
"Administrative Agent"), and as Collateral Agent, BNP PARIBAS, a bank organized
under the laws of France ("BNP Paribas"), as a Bank, as an Issuing Bank, and as
Documentation Agent (together with the Administrative Agent, the "Agents"), and
each other financial institution which may become a party hereto (collectively
the "Banks").
WHEREAS, the Borrower, the Agents, the Issuing Banks and the Banks
entered into that certain Credit Agreement dated as of December 1, 2001 (the
"Original Credit Agreement") with respect to an uncommitted facility of up to
$125,000,000, including an uncommitted letter of credit facility.
WHEREAS, the Borrower, the Agents, the Issuing Banks and the Banks
desire to amend and restate the Original Credit Agreement so that, from time to
time, the Banks, on an uncommitted and fully discretionary basis, continue to
make loans to the Borrower and continue to issue Letters of Credit for the
account of the Borrower in order to provide working capital to the Borrower, to
facilitate the Borrower's purchases of natural gas in the ordinary course of
business, to secure swap counterparties for out-of-the-money swap obligations,
and for such other purposes set forth herein. The Banks have indicated their
willingness to consider to continue to lend such amounts and to consider to
continue to issue and participate in such Letters of Credit on the terms and
conditions of this Agreement.
NOW, THEREFORE, in consideration of the mutual agreements, provisions
and covenants contained herein, the parties agree as follows:
ARTICLE I
DEFINITIONS
1.01 Certain Defined Terms. The following terms have the following
meanings:
"Account" has the meaning stated in the New York Uniform Commercial
Code.
"Account Debtor" means a Person who is obligated to the Borrower under
an Account of the Borrower.
"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 Person, or of any business or
division of a Person, (b) the acquisition of in excess of 50% of the capital
stock, partnership 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 with another Person (other than a Person that is a Subsidiary);
provided, however, that the relevant Borrower or the Subsidiary is the surviving
entity.
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"Activation Period" means the period which commences within a
reasonable period of time not to exceed two Business Days after receipt by Bank
of America, N.A. of a written notice from Fortis in the form of Exhibit B to the
Three Party Agreement Relating to Lockbox Services (With Activation) dated as of
April 15, 2002 among the Borrower, Fortis and Bank of America, N.A.
"Adjusted Pro Rata Share" means, as to any Bank at any particular
time, the percentage equivalent (expressed as a decimal, rounded to the ninth
decimal place) at such time of (a) an amount equal to such Bank's Uncommitted
Line Portion plus, in the case of BNP Paribas, the amount of advances made in
excess of the Borrowing Base Advance Cap to fund Obligations of the Borrower
under Swap Contracts, divided by (b) the combined total of the Uncommitted Line
Portion of all the Banks plus, in the case of BNP Paribas, the amount of
advances made in excess of the Borrowing Base Advance Cap to fund Obligations of
the Borrower under Swap Contracts.
"Administrative Agent" means Fortis in its capacity as administrative
agent for the Banks hereunder, and any successor agent arising under Section
10.09.
"Administrative Agent's Payment Office" means the address for payments
set forth on Schedule 11.02 hereto in relation to the Administrative Agent, or
such other address as the Administrative Agent may from time to time specify.
"Advance Maturity Date" means the maturity date of advances made
hereunder which for Base Rate Loans will be the earliest to occur of (a) written
demand by any Agent, or (b) 60 days from the date of the Borrowing, and for
Offshore Rate Loans will be the earliest to occur of (i) written demand by any
Agent, or (ii) 60 days from the date of the Borrowing, or (iii) the end of the
Interest Period for such Offshore Rate Loan.
"Affiliate" means, as to any Person, any other Person which, directly
or indirectly, is in control of, is controlled by, or is under common control
with, such Person. A Person shall be deemed to control another Person if the
controlling Person possesses, directly or indirectly, the power to direct or
cause the direction of the management and policies of the other Person, whether
through the ownership of voting securities, by contract, or otherwise.
"Agents" means the Administrative Agent, the Collateral Agent and the
Documentation Agent.
"Agent-Related Persons" means the Administrative Agent, the Collateral
Agent and the Documentation Agent, together with their respective Affiliates and
the officers, directors, employees, agents and attorneys-in-fact of such Persons
and Affiliates.
"Agreement" means this Credit Agreement.
"Applicable Margin" means:
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(a) with respect to Base Rate Loans, one-half percent (0.50%);
and
(b) with respect to Offshore Rate Loans, two and one-half
percent (2.50%).
"Approving Banks" has the meaning set forth in Section 2.14.
"Assets from Risk Management Activities" means unrealized gains
resulting from ▇▇▇▇-to-Market valuation of storage, transportation, and
requirements contracts, over-the-counter and exchange-traded options, and
forwards, futures, and swap contracts.
"Assignee" has the meaning specified in Subsection 11.08(a).
"Atmos Support Agreement" means an agreement of Atmos Energy
Corporation to provide certain support for Borrower and its operations and to
remit insurance proceeds to the Agents as provided therein, such agreement to be
in form and substance acceptable to Agents.
"Attorney Costs" means and includes all reasonable fees and
disbursements of any law firm or other external counsel, the allocated cost of
internal legal services and all disbursements of internal counsel.
"Bank Blocked Account" means the Collateral Agent's account no.
323373461 maintained with Chase into which collections and available balances
from the Lock Box will be deposited pursuant to Section 7.14.
"Bankruptcy Code" means the Federal Bankruptcy Reform Act of 1978, as
amended (11 U.S.C.ss.101, et seq.).
"Banks" shall initially mean Fortis, BNP Paribas, Societe Generale,
Natexis Banques Populaires, New York Branch, and RZB Finance, LLC. At such time
as additional lending institutions are added to this Agreement, either through
an amendment to this Agreement or through an Assignment and Acceptance in
accordance with Subsection 11.08(a) hereof, the term "Bank" shall mean Fortis,
BNP Paribas, Societe Generale, Natexis Banques Populaires, New York Branch, RZB
Finance, LLC, and each such additional lending institution. References to the
"Banks" shall include Fortis and BNP Paribas, including each in its capacity as
an Issuing Bank; for purposes of clarification only, to the extent that Fortis
or BNP Paribas may have any rights or obligations in addition to those of the
Banks due to their status as an Issuing Bank and as Agents, Fortis' and BNP
Paribas' status as such will be specifically referenced.
"Base Rate" means, for any day, the higher of: (a) 0.50% per annum
above the latest Federal Funds Rate; or (b) the per annum rate of interest
established by Chase from time to time at its principal office in New York City
as its "prime rate" or "base rate" for U.S. dollar loans (with any change in
such prime rate or base rate to become effective as and when such prime rate or
base rate changes). (The "prime rate" or "base rate" is a rate set by Chase
based upon various factors including Chase's costs and desired return, general
economic conditions and other factors, and is used as a reference point for
pricing some loans, which may be priced at, above or below such announced rate.)
"Base Rate Loan" means any Loan bearing interest based upon the Base
Rate.
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"BNP Paribas" means BNP Paribas, a bank organized under the laws of
France.
"Borrower" means ▇▇▇▇▇▇▇▇ Marketing, L.L.C., a Delaware limited
liability company.
"Borrowing" means a borrowing hereunder consisting of Revolving Loans
made to the Borrower on the same day by the Banks under Article II.
"Borrowing Base Advance Cap" means at any time an amount equal to the
least of:
(a) $250,000,000.00;
(b) the Total Subscribed Line Portions;
(c) the Borrowing Base Sub-Cap; or
(d) the sum of:
(i) the amount of Cash Collateral and other liquid investments
which are acceptable to the Banks in their sole discretion and which are
subject to a first perfected security interest in favor of Administrative
Agent, as collateral agent for the Banks, and which have not been used in
determining availability for any other advance (other than advances made
under the Borrowing Base Line) or Letter of Credit Issuance; plus
(ii) 90% of Borrower's equity in Eligible Broker accounts from and
after the date that a tri-party agreement with respect to such accounts is
entered into, to the extent such equity is not being used in determining
availability for any other advance (other than advances made under the
Borrowing Base Line) or Letter of Credit Issuance; plus
(iii) 90% of the amount of Tier I Accounts which are not being used
in determining availability for any other advance (other than advances made
under the Borrowing Base Line) or Letter of Credit Issuance, net of
deductions, offsets and counterclaims; plus
(iv) 85% of the amount of Tier II Accounts which are not being used
in determining availability for any other advance (other than advances made
under the Borrowing Base Line) or Letter of Credit Issuance, net of
deductions, offsets and counterclaims; plus
(v) 85% of the amount of Tier I Unbilled Accounts which are not
being used in determining availability for any other advance (other than
advances made under the Borrowing Base Line) or Letter of Credit Issuance;
plus
(vi) 80% of the amount of Tier II Unbilled Accounts which are not
being used in determining availability for any other advance (other than
advances made under the Borrowing Base Line) or Letter of Credit Issuance;
plus
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(vii) 80% of the amount of Eligible Inventory which are not being
used in determining availability for any other advance (other than advances
made under the Borrowing Base Line) or Letter of Credit Issuance; plus
(viii) 80% of the amount of Eligible Exchange Receivables which are
not being used in determining availability for any other advance (other
than advances made under the Borrowing Base Line) or Letter of Credit
Issuance; plus
(ix) 80% of the amount of Undelivered Product Value; plus
(x) 70% of Realizable Unrealized Profits, up to a maximum amount of
$50,000,000, less
(xi) the amounts which would be subject to a so-called "First
Purchaser Lien" as defined in Texas Bus. & Com. Code Section 9.343,
comparable laws of the states of Louisiana, Oklahoma, Kansas, Wyoming or
New Mexico, or any other comparable law, unless a Letter of Credit secures
payment of all amounts subject to such First Purchaser Lien; less
(xii) 125% of the ▇▇▇▇ to market amounts owed to BNP Paribas and/or
its Affiliates and Societe Generale and/or its Affiliates under Swap
Contracts; and less
(xiii) 100% of Borrower's Unrealized ▇▇▇▇-to-Market Losses as of the
date of determination of the Borrowing Base Advance Cap.
In no event shall any amounts described in (d)(i) through (d)(x) above
which may fall into more than one of such categories be counted more than once
when making the calculation under this definition.
"Borrowing Base Collateral Position Report" means a report detailing
all Collateral which has been or is being used in determining availability for
an advance or letter of credit issuance under the Borrowing Base Line, such
report to be in the form attached hereto as Exhibit E.
"Borrowing Base Line" means the uncommitted line of credit for the
purpose of (a) providing working capital and to fund payments to suppliers of
Product; (b) to provide for Letters of Credit to secure suppliers of Product;
and (c) to fund payments due to a Swap Bank under any Swap Contract.
"Borrowing Base Sub-Cap" means (a) from the date of this Agreement
until the date the first election is made by the Borrower pursuant to clause (b)
of this definition, $125,000,000, and (b) thereafter, at any time, the amount
set forth in the table below under the heading "Borrowing Base Sub-Cap" elected
by the Borrower from time to time by written notice to the Agents, provided
that, at the time of any such election of any such amount as the Borrowing Base
Sub-Cap, but not for any other purpose herein, each of the Borrower's Net
Working Capital, Tangible Net Worth and ratio of Total Liabilities to Tangible
Net Worth at such time of election, and the maximum cumulative loss for the
period commencing on the Closing Date and ending on the date of such election
(determined as a single accounting period),
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each as determined by the most recent monthly financial statements received
pursuant to Section 7.01(c), are within the requirements set forth opposite such
amount in the table below. For purposes of testing whether such requirements
have been met, the highest amount elected by the Borrower for the month being
tested shall be used, where during the same month being tested the Borrower
elected to either increase or decrease the availability by selecting a different
amount under the column entitled "Borrowing Base Sub-Cap".
Maximum Cumulative
Maximum Ratio at Cumulative Loss
Borrowing Base Minimum Net Minimum Tangible Total Liabilities to from Closing Date to
Sub-Cap Working Capital Net Worth Tangible Net Worth time of election
-------------- --------------- ---------------- -------------------- --------------------
$100,000,000 $20,000,000 $21,000,000 5.00 to 1 $ 4,000,000
$125,000,000 $25,000,000 $26,000,000 5.00 to 1 $ 5,000,000
$150,000,000 $30,000,000 $31,000,000 5.00 to 1 $ 6,000,000
$175,000,000 $35,000,000 $36,000,000 5.00 to 1 $ 7,000,000
$200,000,000 $40,000,000 $41,000,000 5.00 to 1 $ 8,000,000
$225,000,000 $45,000,000 $46,000,000 5.00 to 1 $ 9,000,000
$250,000,000 $50,000,000 $51,000,000 5.00 to 1 $10,000,000
"Borrowing Date" means any date on which a Borrowing occurs under
Section 2.03.
"Business Day" (a) with respect to all matters other than those
related to Offshore Rate Loans, means any day other than a Saturday, Sunday or
other day on which commercial banks in New York, New York, are authorized, or
required, by law to close and (b) means, for purposes of determining business
days in connection with Offshore Rate Loans, any day on which transactions are
made in the applicable offshore dollar interbank market other than a Saturday,
Sunday or other day on which commercial banks in New York, New York, are
authorized or required, by law to close.
"Capital Adequacy Regulation" means any guideline, request or
directive of any central bank or other Governmental Authority, or any other law,
rule or regulation, whether or not having the force of law, in each case,
regarding capital adequacy of any Bank or of any corporation controlling a Bank.
"Capital Stock" means capital stock, membership interest, equity
interest or other obligations or securities of, or any interest in, any Person.
"Cash Collateral" means currency issued by the United States and
Marketable Securities which have been Cash Collateralized for the benefit of the
Banks.
"Cash Collateralize" means to pledge and deposit with or deliver to
the Collateral Agent, for the benefit of the Collateral Agent, the Issuing Banks
and the Banks, Cash Collateral as collateral for the Obligations pursuant to
documentation in form and substance satisfactory to Agents (which documents are
hereby consented to by the Banks). The Borrower hereby grants to the Collateral
Agent, for the benefit of the Collateral Agent, the Issuing Banks and the Banks,
a security interest in all such Cash Collateral. Cash Collateral shall be
maintained in the Bank Blocked Account.
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"Change of Control" means, at any time:
(a) Atmos Energy Corporation shall cease to own and control legally
and beneficially, either directly or indirectly, Voting Interests in Atmos
Energy Holdings, Inc. representing 100% of the combined voting power of all of
the Voting Interests in Atmos Energy Holdings, Inc. (on a fully diluted basis);
or
(b) Atmos Energy Holdings, Inc. shall cease to own and control
directly or indirectly, beneficial interest in Equity Interests representing
100% of the economic equity interest in the Borrower.
"Chase" means ▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇ Bank (or any successor).
"Closing Date" means the date on which all conditions precedent set
forth in Section 5.01 are satisfied or waived by all Banks.
"Code" means the Internal Revenue Code of 1986, and regulations
promulgated thereunder.
"Collateral" means all assets of the Borrower including, without
limitation, all accounts, equipment, chattel paper, inventory, natural gas in
transit, instruments, contract rights, the Bank Blocked Account, stock,
partnership interests, and general intangibles, whether presently existing or
hereafter acquired or created and the proceeds thereof.
"Collateral Agent" means Fortis Capital Corp.
"Collateral Position" means the total availability under the Borrowing
Base Advance Cap.
"Compliance Certificate" means a certificate, in form attached hereto
as Exhibit C, whereby the Borrower certifies that it is in compliance with this
Agreement.
"Consolidated" means the consolidation of accounts in accordance with
GAAP.
"Contingent Obligation" means, as to any Person, any direct or
indirect liability of that Person, whether or not contingent, with or without
recourse, (a) with respect to any Indebtedness, lease, dividend, letter of
credit or other obligation (the "primary obligations") of another Person (which
obligations and Person are referred to herein as the "primary obligation" and
the "primary obligor," respectively), including any obligation of that Person
(i) to purchase, repurchase or otherwise acquire such primary obligations or any
security therefor, (ii) to advance or provide funds for the payment or discharge
of any such primary obligation, or to maintain working capital or equity capital
of the primary obligor or otherwise to maintain the net worth or solvency or any
balance sheet item, level of income or financial condition of the primary
obligor, (iii) to purchase property, securities or services primarily for the
purpose of assuring the owner of any such primary obligation of the ability of
the primary obligor to make payment of such
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primary obligation, or (iv) otherwise to assure or hold harmless the holder of
any such primary obligation against loss in respect thereof (each, a "Guaranty
Obligation"); (b) with respect to any Surety Instrument (other than any Letter
of Credit) issued for the account of that Person or as to which that Person is
otherwise liable for reimbursement of drawings or payments; (c) to purchase any
materials, supplies or other property from, or to obtain the services of,
another Person if the relevant contract or other related document or obligation
requires that payment for such materials, supplies or other property, or for
such services, shall be made regardless of whether delivery of such materials,
supplies or other property is ever made or tendered, or such services are ever
performed or tendered; or (d) in respect of any swap contract.
"Contractual Obligation" means, as to any Person, any provision of any
security issued by such Person or of any agreement, undertaking, contract,
indenture, mortgage, deed of trust or other instrument, document or agreement to
which such Person is a party or by which it or any of its property is bound.
"Conversion/Continuation Date" means any date on which, under Section
2.04, the Borrower (a) converts Loans of one Type to another Type, or (b)
continues such Loans as Loans of the same Type, but with a new Interest Period.
"Conversion to Reduced Funding Banks Date" has the meaning specified
in Section 2.14.
"Credit Extension" means and includes (a) the making of any Loans
hereunder, and (b) the Issuance of any Letters of Credit hereunder.
"Current Assets" means, with respect to any Person on any date of
determination, all assets of such Person and its Subsidiaries that, in
accordance with GAAP, would be classified as current assets on the balance sheet
of a Person conducting a business the same as or similar to that of such Person,
after deducting appropriate and adequate reserves therefrom in accordance with
GAAP, determined on a Consolidated basis, and excluding any accounts receivable
owed by any Affiliate of the Borrower to the extent such accounts receivable
arose in transactions conducted other than on an arms-length basis.
"Current Liabilities" means, with respect to any Person on any date of
determination, all liabilities of such Person and its Subsidiaries that, in
accordance with GAAP, would be classified as current liabilities on the balance
sheet of a Person conducting a business the same as or similar to that of such
Person, as determined on a Consolidated basis, but excluding to the extent
otherwise included therein any current portion of the Subordinated Debt.
"Declining Bank" has the meaning specified in Section 2.14.
"Default" means any event or circumstance which, with the giving of
notice, the lapse of time, or both, would constitute an Event of Default.
"Default Rate" has the meaning specified in Subsection 2.08(a).
"Documentation Agent" means BNP Paribas in its capacity as
documentation agent for the Banks hereunder.
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"Dollar Advance Cap" means a cap upon Revolving Loans under
the Borrowing Base Line with the following limits:
(a) $50,000,000.00 at such times as the Borrowing Base Sub-Cap is
$100,000,000.00;
(b) $60,000,000.00 at such times as the Borrowing Base Sub-Cap is
$125,000,000.00;
(c) $70,000,000.00 at such times as the Borrowing Base Sub-Cap is
$150,000,000.00; and
(d) $80,000,000.00 at such times as the Borrowing Base Sub-Cap is
$175,000,000.00; and
(e) $90,000,000.00 at such times as the Borrowing Base Sub-Cap is
$200,000,000.00; and
(f) $100,000,000.00 at such times as the Borrowing Base Sub-Cap is
$225,000,000.00; and
(g) $100,000,000.00 at such times as the Borrowing Base Sub-Cap is
$250,000,000.00.
"Dollars," and "$" each mean lawful money of the United States.
"Effective Amount" means (a) with respect to any Loans on any date,
the aggregate outstanding principal amount thereof after giving effect to any
Borrowings and prepayments or repayments of Loans occurring on such date; and
(b) with respect to any outstanding L/C Obligations on any date, the amount of
such L/C Obligations on such date after giving effect to any Issuances of
Letters of Credit occurring on such date and any other changes in the aggregate
amount of the L/C Obligations as of such date, including changes as a result of
expiration or cancellation, any reimbursements of outstanding unpaid drawings
under any Letters of Credit or any reductions in the maximum amount available
for drawing under Letters of Credit taking effect on such date.
"Eligible Accounts" means, at the time of any determination thereof,
each of the Borrower's Accounts as to which the following requirements have been
fulfilled to the satisfaction of the Banks:
(a) Such Account (if for an amount in excess of $750,000.00) is
acceptable to each of the Banks in their sole discretion and either (i) is the
result of a sale to a Tier I or Tier II Account Party, or (ii) is secured by
letters of credit in form acceptable to the Banks in their sole discretion and
issued by banks approved by the Banks in their sole discretion;
(b) Borrower has lawful and absolute title to such Account;
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(c) Such Account is a valid, legally enforceable obligation of the
Person who is obligated under such Account for goods actually delivered or to be
delivered to such Account Debtor in the ordinary course of the Borrower's
business;
(d) Such Account shall have excluded therefrom any portion that is
subject to any dispute, offset, counterclaim or other claim or defense on the
part of the Account Debtor or to any claim on the part of the Account Debtor
denying liability under such Account; provided, however, that in the event that
the portion that is subject to any such dispute, counterclaim or other claim or
defense is secured with a Letter of Credit, such portion secured by the Letter
of Credit shall not be excluded;
(e) Such Account is not evidenced by any chattel paper, promissory
note or other instrument;
(f) Such Account is subject to a fully perfected first priority
security interest (or properly filed and acknowledged assignment, in the case of
U.S. government contracts, if any) in favor of the Administrative Agent pursuant
to the Loan Documents, prior to the rights of, and enforceable as such against,
any other Person, and such Account is not subject to any security interest or
Lien in favor of any Person other than the Liens of the Banks pursuant to the
Loan Documents;
(g) Such Account shall have excluded therefrom any portion which is
not payable in Dollars in the U.S.;
(h) Such Account has been due and payable for 15 days or less (or 30
days or less, if the Account Debtor is a Governmental Authority) from the date
of the invoice and no extension or indulgence has been granted extending the due
date beyond a 15 day period (or 30 days, as the case may be), except if such
Account by its terms provides for a 15 day payment period, then such Account
shall be eligible for up to 30 days from the date of invoice, or as otherwise
approved by Banks in writing; and
(i) No Account Debtor in respect of such Account is (i) an Affiliate
of the Borrower, or (ii) incorporated in or primarily conducting business in any
jurisdiction outside of the U.S., unless such Account Debtor and the Account is
approved in writing by the Banks; provided, however, that as long as Atmos
Energy Corporation maintains an S&P rating of BBB+ or a ▇▇▇▇▇'▇ rating of Baa1
or better, and such Accounts would otherwise qualify as Eligible Accounts,
Accounts of Atmos Energy Corporation (and its Subsidiaries and Affiliates that
have been approved by Agents as Tier I Account Parties) may be included as Tier
I Accounts to the extent that such Accounts do not exceed 50% of Borrower's
total Accounts.
(j) The balance of such Account shall be the net of, in each case (i)
any accounts payable owing to the Account Debtor by the Borrower on such Account
and (ii) after application thereof to any Eligible Exchange Receivables,
Unbilled Eligible Accounts, and Realizable Unrealized Profits with such Account
Debtor, other offsets against amounts owed to such Account Debtor, whether in
respect of unbilled purchases, out-of-the-money positions or unperformed
contracts for purchase.
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"Eligible Assignee" means (a) a commercial bank organized under the
laws of the United States, or any state thereof, and having a combined capital
and surplus of at least $100,000,000.00; (b) a commercial bank organized under
the laws of any other country which is a member of the Organization for Economic
Cooperation and Development (the "OECD"), or a political subdivision of any such
country, and having a combined capital and surplus of at least $100,000,000.00,
provided, however, that such bank is acting through a branch or agency located
in the United States; and (c) a Person that is primarily engaged in the business
of commercial lending and that is (i) a Subsidiary of a Bank (or bank referred
to in the preceding clauses (a) or (b)), (ii) a Subsidiary of a Person of which
a Bank (or bank referred to in the preceding clauses (a) or (b)) is a
Subsidiary, or (iii) a Person of which a Bank (or bank referred to in the
preceding clauses (a) or (b)) is a Subsidiary.
"Eligible Broker" means BNP Paribas, FIMAT USA, Inc. or any Affiliate
of BNP Paribas or FIMAT USA, Inc., or any broker approved in writing by the
Agents and the Banks.
"Eligible Commodity Futures Accounts" means an account or accounts
with an Eligible Broker, in which the Collateral Agent is granted a first and
prior security interest as Collateral Agent for the Banks pursuant to Hedging
Assignments which security interest is subject only to the rights of the
Eligible Broker under such accounts.
"Eligible Exchange Receivables" means all enforceable rights of the
Borrower to receive Product in exchange for the sale or trade of Product
previously delivered to the exchange debtor by the Borrower valued at an
independent posting and which (a) are evidenced by a written agreement
enforceable against the exchange debtor thereof, (b) are current pursuant to the
terms of the contract or invoice, (c) are subject to a perfected, first Lien in
favor of the Administrative Agent for the benefit of the Banks subject only to
Permitted Liens, and no other Lien, charge, offset or claim, (d) are not the
subject of a dispute between the exchange debtor and the Borrower, (e) are
valued at ▇▇▇▇▇'▇ spot market price or an independent posting acceptable to the
Banks in their sole discretion, (f) if arising pursuant to contracts involving
an amount in excess of $750,000, are contracts by exchangers pre-approved by the
Banks in their sole discretion, or contracts secured by letters of credit in
form acceptable to the Banks in their sole discretion and issued by banks
approved by the Banks in their sole discretion, (g) have not been otherwise
determined by the Banks in their sole discretion to be unacceptable to them, and
(h) are the net of, in each case (i) any payables owing to such exchange debtor
by the Borrower and (ii) after application thereof to any Eligible Accounts,
Unbilled Eligible Accounts, and Realizable Unrealized Profits with such Account
Debtor, other offsets against amounts owed to such exchange debtor, whether in
respect of unbilled purchases, out-of-the-money positions or unperformed
contracts for purchase. The Product and Account relating to or creating any
Eligible Exchange Receivable shall not be simultaneously included in any other
availability calculation, including, without limitation, Undelivered Product
Value, Eligible Inventory or Eligible Accounts.
"Eligible Inventory" means, at the time of determination thereof, all
of the Borrower's inventory stored in terminals (and provided the terminal
owners are subject to approval by the Banks in their sole discretion) valued at
the lower of cost or current market price (as referenced by a published source
acceptable to Banks in their sole discretion), and in all instances as to which
the following requirements have been fulfilled to the satisfaction of the Banks:
12
(a) The inventory is owned by the Borrower free and clear of all
Liens in favor of third parties, except Liens in favor of the Banks under the
Loan Documents and except for Permitted Liens;
(b) The inventory has not been identified to deliveries with the
result that a buyer would have rights to the inventory that would be superior to
the Administrative Agent's security interest for the benefit of the Banks, nor
shall such inventory have become the subject of a customer's ownership or Lien;
(c) The inventory is in transit in the U.S. under the control and
ownership of the Borrower or is in a pipeline or a ▇▇▇▇ of lading has been
issued to the Administrative Agent if such inventory is in the hands of a third
party carrier or is located in the U.S. at the locations described on Schedule
7.03(f), or at such other place as has been specifically agreed to in writing by
the Banks and the Borrower; and
(d) The inventory is subject to a fully perfected first priority
security interest in favor of the Administrative Agent for the benefit of the
Banks pursuant to the Loan Documents.
"Environmental Claims" means all claims, however asserted, by any
Governmental Authority or other Person alleging potential liability or
responsibility for violation of any Environmental Law, or for release or injury
to the environment.
"Environmental Laws" means all federal, state or local laws, statutes,
common law duties, rules, regulations, ordinances and codes, together with all
administrative orders, directed duties, requests, licenses, authorizations and
permits of, and agreements with, any Governmental Authorities, in each case
relating to environmental, health, safety and land use matters.
"Equity Interests": means, with respect to any Person, all of the
shares of capital stock of (or other ownership, beneficial or profit interests
in) such Person, all of the warrants, options or other rights for the purchase
or other acquisition from such Person of shares of capital stock of (or other
ownership, beneficial or profit interests in) such Person, all of the securities
convertible into or exchangeable for shares of capital stock of (or other
ownership, beneficial or profit interests in) such Person or warrants, rights or
options for the purchase or other acquisition from such Person of such shares
(or such other interests), and all of the other ownership, beneficial or profit
interests in such Person (including, without limitation, partnership, member or
trust interests therein), whether voting or nonvoting, and whether or not such
shares, warrants, options, rights or other interests are authorized or otherwise
existing on any date of determination.
"ERISA" means the Employee Retirement Income Security Act of 1974, and
regulations promulgated thereunder.
13
"ERISA Affiliate" means any trade or business (whether or not
incorporated) under common control with the Borrower within the meaning of
Section 414(b) or (c) of the Code (and Sections 414(m) and (o) of the Code for
purposes of provisions relating to Section 412 of the Code).
"ERISA Event" means (a) a Reportable Event with respect to a Pension
Plan; (b) a withdrawal by the Borrower or any ERISA Affiliate from a Pension
Plan subject to Section 4063 of ERISA during a plan year in which it was a
substantial employer (as defined in Section 4001(a)(2) of ERISA) or a cessation
of operations which is treated as such a withdrawal under Section 4062(e) of
ERISA; (c) a complete or partial withdrawal by the Borrower or any ERISA
Affiliate from a Multiemployer Plan or notification that a Multiemployer Plan is
in reorganization; (d) the filing of a notice of intent to terminate, the
treatment of a Plan amendment as a termination under Section 4041 or 4041A of
ERISA, or the commencement of proceedings by the PBGC to terminate a Pension
Plan or Multiemployer Plan; (e) an event or condition which might reasonably be
expected to constitute grounds under Section 4042 of ERISA for the termination
of, or the appointment of a trustee to administer, any Pension Plan or
Multiemployer Plan; or (f) the imposition of any liability under Title IV of
ERISA, other than PBGC premiums due but not delinquent under Section 4007 of
ERISA, upon the Borrower or any ERISA Affiliate.
"Eurodollar Reserve Percentage" means for any day for any Interest
Period the maximum reserve percentage (expressed as a decimal, rounded upward to
the next 1/100th of 1%) in effect on such day (whether or not applicable to any
Bank) under regulations issued from time to time by the FRB for determining the
maximum reserve requirement (including any emergency, supplemental or other
marginal reserve requirement) with respect to Eurocurrency funding (currently
referred to as "Eurocurrency liabilities").
"Event of Default" means any of the events or circumstances specified
in Section 9.01.
"Exchange Act" means the Securities and Exchange Act of 1934, as
amended, and regulations promulgated thereunder.
"Existing Letters of Credit" means all letters of credit issued by
Fortis and BNP Paribas for the account of the Borrower which are outstanding as
of the date hereof under the Original Credit Agreement and shall not include any
Letter of Credit which is not described on Schedule 3.10 hereto.
"Expiration Date" means the earliest to occur of:
(a) December 31, 2002; or
(b) the date demand for payment is made by the Administrative Agent;
or
(c) the date an Event of Default occurs.
"FDIC" means the Federal Deposit Insurance Corporation, and any
Governmental Authority succeeding to any of its principal functions.
14
"Federal Funds Rate" means, for any day, the rate set forth in the
weekly statistical release designated as H.15(519), or any successor
publication, published by the Federal Reserve Bank of New York (including any
such successor, "H.15(519)") on the preceding Business Day opposite the caption
"Federal Funds (Effective)"; or, if for any relevant day such rate is not so
published on any such preceding Business Day, the rate for such day will be the
arithmetic mean as determined by the Administrative Agent of the rates for the
last transaction in overnight Federal Funds arranged prior to 9:00 a.m. (New
York City time) on that day by each of three leading brokers of Federal Funds
transactions in New York City selected by the Administrative Agent.
"Fortis" means Fortis Capital Corp., a Connecticut corporation.
"FRB" means the Board of Governors of the Federal Reserve System, and
any Governmental Authority succeeding to any of its principal functions.
"Further Taxes" means any and all present or future taxes, levies,
assessments, imposts, duties, deductions, fees, withholding or similar charges
(including, without limitation, net income taxes and franchise taxes), and all
liabilities with respect thereto, imposed by any jurisdiction on account of
amount payable or paid pursuant to Section 4.01.
"GAAP" means generally accepted accounting principles set forth from
time to time in the opinions and pronouncements of the Accounting Principles
Board and the American Institute of Certified Public Accountants and statements
and pronouncements of the Financial Accounting Standards Board (or agencies with
similar functions of comparable stature and authority within the U.S. accounting
profession), which are applicable to the circumstances as of the date of
determination.
"Governmental Authority" means any nation or government, any state or
other political subdivision thereof, any central bank (or similar monetary or
regulatory authority) thereof, any entity exercising executive, legislative,
judicial, regulatory or administrative functions of or pertaining to government,
and any corporation or other entity owned or controlled, through stock or
capital ownership or otherwise, by any of the foregoing.
"Guarantors" means Atmos Energy Holdings, Inc. and Atmos Energy
Marketing LLC.
"Guaranty" means a Guaranty Agreement, in form and substance
acceptable to the Banks in their sole discretion, which has been executed by a
Guarantor and delivered to the Administrative Agent for the benefit of the
Banks.
"Guaranty Obligation" has the meaning specified in the definition of
"Contingent Obligation."
"Hedging Assignment" means a security agreement among Borrower, the
Administrative Agent and an Eligible Broker relating to the collateral
assignment to the Administrative Agent, as collateral agent for the Banks, of
all sums owing from time to time to Borrower with respect to an Eligible
Commodities Futures Account, such agreement to be in form and substance
acceptable to the Banks in their sole discretion.
15
"Honor Date" has the meaning specified in Subsection 3.03(b).
"Indebtedness" of any Person means, without duplication, (a) all
indebtedness for borrowed money; (b) all obligations issued, undertaken or
assumed as the deferred purchase price of property or services (other than trade
payables entered into in the ordinary course of business on ordinary terms); (c)
all non-contingent reimbursement or payment obligations with respect to Surety
Instruments; (d) all obligations evidenced by notes, bonds, debentures or
similar instruments, including obligations so evidenced incurred in connection
with the acquisition of property, assets or businesses; (e) all indebtedness
created or arising under any conditional sale or other title retention
agreement, or incurred as financing, in either case with respect to property
acquired by the Person (even though the rights and remedies of the seller or
bank under such agreement in the event of default are limited to repossession or
sale of such property); (f) all obligations with respect to capital leases; (g)
all obligations with respect to swap contracts; (h) all indebtedness referred to
in clauses (a) through (g) above secured by (or for which the holder of such
Indebtedness has an existing right, contingent or otherwise, to be secured by)
any Lien upon or in property (including accounts and contract rights) owned by
such Person, even though such Person has not assumed or become liable for the
payment of such indebtedness; and (i) all Guaranty Obligations in respect of
indebtedness or obligations of others of the kinds referred to in clauses (a)
through (g) above.
"Indemnified Liabilities" has the meaning specified in Section 11.05.
"Indemnified Person" has the meaning specified in Section 11.05.
"Independent Auditor" has the meaning specified in Subsection 7.01(a).
"Insolvency Proceeding" means, with respect to any Person (a) any
case, action or proceeding with respect to such Person before any court or other
Governmental Authority relating to bankruptcy, reorganization, insolvency,
liquidation, receivership, dissolution, winding-up or relief of debtors, or (b)
any general assignment for the benefit of creditors, composition, marshalling of
assets for creditors, or other, similar arrangement in respect of its creditors
generally or any substantial portion of its creditors; undertaken under U.S.
Federal, state or foreign law, including the Bankruptcy Code.
"Interest Payment Date" means, as to any Loan other than a Base Rate
Loan, the last day of each Interest Period applicable to such Loan and, as to
any Base Rate Loan, the fifth Business Day of each month.
"Interest Period" means, as to any Offshore Rate Loan, the period
commencing on the Borrowing Date of such Loan or on the Conversion/Continuation
Date on which the Loan is converted into or continued as an Offshore Rate Loan,
and ending on the date selected by the Borrower as the ending date thereof, not
to exceed a period of 60 days, in its Notice of Borrowing or Notice of
Conversion/Continuation;
provided, however, that:
(a) if any Interest Period would otherwise end on a day that is not a
Business Day, that Interest Period shall be extended to the following Business
Day unless the result of such extension would be to carry such Interest Period
into another calendar month, in which event such Interest Period shall end on
the preceding Business Day;
16
(b) any Interest Period pertaining to an Offshore Rate Loan that
begins on the last Business Day of a calendar month (or on a day for which there
is no numerically corresponding day in the calendar month at the end of such
Interest Period) shall end on the last Business Day of the calendar month at the
end of such Interest Period; and
(c) no Interest Period shall extend beyond the Expiration Date.
"IRS" means the Internal Revenue Service, and any Governmental
Authority succeeding to any of its principal functions under the Code.
"Issue" means, with respect to any Letter of Credit, to issue or to
extend the expiry of, or to renew or increase the amount of, such Letter of
Credit; and the terms "Issued," "Issuing" and "Issuance" have corresponding
meanings.
"Issuing Banks" initially means Fortis and BNP Paribas, and in the
future means any Bank which Issues Letters of Credit hereunder, in such Bank's
capacity as an issuer of one or more Letters of Credit hereunder, together with
any replacement letter of credit issuer arising under Section 2.14.
"L/C Advance" means each Bank's participation in any L/C Borrowing or
Reducing L/C Borrowing in accordance with (i) its Pro Rata Share with respect to
Letters of Credit Issued prior to the Conversion to Reduced Funding Banks Date
and (ii) its proportionate share, if any, as an Approving Bank with respect to
all Letters of Credit Issued thereafter.
"L/C Amendment Application" means an application form for amendment of
outstanding standby or commercial documentary letters of credit as shall at any
time be in use at any Issuing Bank, as such Issuing Bank shall request.
"L/C Application" means an application form for Issuances of standby
or commercial documentary letters of credit as shall at any time be in use at
any Issuing Bank, as such Issuing Bank shall request.
"L/C Borrowing" means an extension of credit resulting from either a
drawing under any Letter of Credit or a Reducing L/C Borrowing, which extension
of credit shall not have been reimbursed on the date when made nor converted
into a Borrowing of Revolving Loans under Subsection 3.03(c).
"L/C Cap" means the maximum availability for Issuance of Letters of
Credit under the Borrowing Base Line which shall be an amount equal to the total
Effective Amount of L/C Obligations plus the Effective Amount of then
outstanding Loans not to exceed the Borrowing Base Advance Cap.
"L/C Obligations" means at any time the sum of (a) the aggregate
undrawn amount of all Letters of Credit then outstanding, plus (b) the amount of
all unreimbursed drawings under all Letters of Credit, including all outstanding
L/C Borrowings.
17
"L/C-Related Documents" means the Letters of Credit, the L/C
Applications, the L/C Amendment Applications, the Continuing Agreement for
Letters of Credit dated December 1, 2001, and any other document relating to any
Letter of Credit, including, but not limited to, any Issuing Bank's standard
form documents for letter of credit issuances.
"Lending Office" means, as to any Bank, the office or offices of such
Bank specified as its "Lending Office" on Schedule 11.02, or such other office
or offices as such Bank may from time to time notify the Borrower and the
Administrative Agent.
"Letter of Credit Facility" means, at any time, the uncommitted
undertaking to provide Letters of Credit in an amount equal to the lesser of (a)
the amount of the aggregate Uncommitted Line Portions at such time and (b)
$250,000,000, as such amount may be reduced at or prior to such time pursuant to
this Agreement.
"Letters of Credit" means (a) any letters of credit (whether standby
letters of credit or commercial documentary letters of credit) Issued by an
Issuing Bank pursuant to Article III, (b) any Reducing Letters of Credit, and
(c) any of the Existing Letters of Credit.
"Liabilities from Risk Management Activities" means unrealized losses
resulting from ▇▇▇▇-to-Market valuation of storage, transportation, and
requirements contracts, over-the-counter and exchange-traded options, and
forwards, futures, and swap contracts.
"LIBOR" means the rate of interest per annum determined by the
Administrative Agent as the rate at which dollar deposits in the approximate
amount of Fortis' Offshore Rate Loan for such Interest Period would be offered
by Fortis' London branch as stated on Telerate News Service Page 3750 as of
11:00 a.m. (London time) two (2) Business Days prior to the Borrowing Date. If
such interest rates shall cease to be available from Telerate News Service, the
LIBOR Rate shall be determined from such financial reporting service or other
information as shall be mutually acceptable to the Administrative Agent and the
Borrower.
"Lien" means any security interest, mortgage, deed of trust, pledge,
hypothecation, assignment, charge, encumbrance, or lien, statutory or other in
respect of any property, including those created by, arising under or evidenced
by any conditional sale or other title retention agreement, the interest of a
lessor under a capital lease, any financing lease having substantially the same
economic effect as any of the foregoing, or the filing of any financing
statement naming the owner of the asset to which such lien relates as debtor,
under the Uniform Commercial Code or any comparable law.
"Line" means the Borrowing Base Line.
"Loan" means any extension of credit by a Bank to the Borrower under
Article II or Article III in the form of a Revolving Loan or an L/C Advance. All
Loans are demand in nature and Borrower hereby acknowledges and agrees the
Banks' right to demand payment at any time and for any reason or for no reason,
and such right is absolute and unconditional.
"Loan Documents" means this Agreement, the Notes, the Guaranty, the
Security Agreement, the L/C-Related Documents, Swap Contracts, the Three Party
Agreement, the Atmos Support Agreement, and all other documents delivered to the
Administrative Agent or any Bank in connection herewith.
18
"Lock Box" has the meaning specified in Section 7.14.
"Long Position" means the aggregate number of MMBTUS of Product,
including that of the Prompt Month, which are either held in inventory by the
Borrower or which the Borrower has contracted to purchase (whether by purchase
of a contract on a commodities exchange or otherwise), or which the Borrower
will receive on exchange or the notional quantity under a swap contract
including, without limitation, all option contracts representing the obligation
of the Borrower to purchase Product at the option of a third party, and in each
case, for which a fixed purchase price has been set. Long Positions will be
expressed as a positive number.
"Margin Stock" means "margin stock" as such term is defined in
Regulation G, T, U or X of the FRB.
"▇▇▇▇-to-Market" means, the method of accounting used to account for
derivative commodity instruments entered into for trading purposes, in
accordance with EITF 98-10, "Accounting for Energy Trading and Risk Management
Activities" and any future open obligation.
"Marketable Securities" means (a) certificates of deposit issued by
any bank with a Fitch rating of A or better, (b) commercial paper rated P-1, A-1
or F-1, (c) bankers acceptances rated prime, or (d) U.S. Government obligations
with tenors of 90 days or less.
"Material Adverse Effect" means (a) a material adverse change in, or a
material adverse effect upon, the operations, business, properties, condition
(financial or otherwise) or prospects of the Borrower or the Borrower and its
Subsidiaries taken as a whole, (b) a material impairment of the ability of the
Borrower to perform under any Loan Document and to avoid any Event of Default,
or (c) a material adverse effect upon the legality, validity, binding effect or
enforceability against the Borrower or any of its Subsidiaries.
"Maturity Date" means March 31, 2003.
"Multiemployer Plan" means a "multiemployer plan," within the meaning
of Section 4001(a)(3) of ERISA, to which the Borrower or any ERISA Affiliate
makes, is making, or is obligated to make contributions or, during the preceding
three (3) calendar years, has made, or been obligated to make, contributions.
"Net Position" means the sum of all Long Positions and Short Positions
of the Borrower.
"Net Position Report" means a report in form attached hereto as
Exhibit F.
"Net Working Capital" means, as to the Borrower and the Subsidiaries,
the excess of Current Assets (minus all amounts due from employees, owners,
Subsidiaries and Affiliates other than Accounts of Atmos Energy Corporation and
its Subsidiaries and Affiliates permitted
19
to be included as Eligible Accounts in the calculation of the Borrowing Base
Advance Cap) over Current Liabilities (excluding the current portion of the
Subordinated Debt), less investments in Capital Stock.
"Notes" means the promissory notes executed by the Borrower in favor
of a Bank pursuant to Subsection 2.02(b), in form approved by the Banks. A Note
will be issued by the Borrower to each entity that becomes a Bank hereunder from
time to time, but will not be issued to Participants of a Bank.
"Notice of Borrowing" means the applicable notice in substantially the
form of Exhibit A.
"Notice of Conversion/Continuation" means a notice in substantially
the form of Exhibit B.
"Obligations" means all advances, debts, liabilities, obligations,
covenants and duties arising under any Loan Document, owing by the Borrower to
any Bank, or any affiliate of any Bank, Agents, or any Indemnified Person,
whether direct or indirect (including those acquired by assignment), absolute or
contingent, due or to become due, now existing or hereafter arising, including,
without limitation, all obligations of the Borrower under Revolving Loans,
Letters of Credit, and any Swap Contracts.
"Offshore Effective Amount" means the product of the principal amount
of an Offshore Rate Loan or requested Offshore Rate Loan and the number of days
in the applicable Interest Period for such Offshore Rate Loan.
"Offshore Rate" means, for any Interest Period, with respect to
Offshore Rate Loans comprising part of the same Borrowing, the rate of interest
per annum (rounded upward to the next 1/16th of 1%) determined by Agents as
follows:
LIBOR
Offshore Rate = -----------------------------
1.00 - Eurodollar Reserve Percentage
The Offshore Rate shall be adjusted automatically as to all Offshore
Rate Loans then outstanding as of the effective date of any change in the
Eurodollar Reserve Percentage.
"Offshore Rate Loan" means a Loan that bears interest based on the
Offshore Rate.
"Organization Documents" means (a) for any corporation, the
certificate or articles of incorporation, the bylaws, any certificate of
determination or instrument relating to the rights of preferred shareholders of
such corporation, any shareholder rights agreement, and all applicable
resolutions of the board of directors (or any committee thereof) of such
corporation, and (b) for any partnership, the partnership agreement, and all
other documents or filings as may be required by the Secretary of State (or
other applicable governmental agency) in the state of such partnership's
formation.
20
"Original Credit Agreement" means that certain Credit Agreement, dated
as of December 1, 2001, between the Borrower, the banks party thereto from time
to time, and Fortis Capital Corp., as agent for the banks, as heretofore
amended.
"Other Taxes" means any present or future stamp or documentary taxes
or any other excise or property taxes, charges or similar levies which arise
from any payment made hereunder or from the execution, delivery or registration
of, or otherwise with respect to, this Agreement or any other Loan Documents.
"Participant" has the meaning specified in Subsection 11.08(d).
"PBGC" means the Pension Benefit Guaranty Corporation, or any
Governmental Authority succeeding to any of its principal functions under ERISA.
"Pension Plan" means a pension plan (as defined in Section 3(2) of
ERISA) subject to Title IV of ERISA which the Borrower sponsors, maintains, or
to which it makes, is making, or is obligated to make contributions, or in the
case of a multiple employer plan (as described in Section 4064(a) of ERISA) has
made contributions at any time during the immediately preceding five (5) plan
years.
"Permitted Liens" has the meaning specified in Section 8.01.
"Person" means an individual, partnership, corporation, business
trust, joint stock company, trust, unincorporated association, joint venture or
Governmental Authority.
"Plan" means an employee benefit plan (as defined in Section 3(3) of
ERISA) which the Borrower sponsors or maintains or to which the Borrower makes,
is making, or is obligated to make contributions and includes any Pension Plan.
"Product" means natural gas.
"Pro Rata Share" means, as to any Bank at any time, the percentage
equivalent (expressed as a decimal, rounded to the ninth decimal place) at such
time of such Bank's Uncommitted Line Portion divided by the combined total of
the Uncommitted Line of all the Banks.
"Prompt Month" means, as of any Reporting Effective Date, the month
following the month such reporting occurs.
"Realizable Unrealized Profits" means at any time, the sum of the
Borrower's net unrealized cash market profits realizable within six months from
such time, from Accounts of the Borrower which are Eligible Accounts (other than
the requirement of subparagraph (h) in the definition of "Eligible Accounts")
and which are for Product which has been contracted to be delivered to an
Account Debtor, net of, in each case (i) any accounts payable owing to the
Account Debtor from the Borrower on such Account and (ii) after application
thereof to any Eligible Accounts, Eligible Exchange Receivables, and Unbilled
Eligible Accounts with such Account Debtor, other offsets against amounts owed
to such Account Debtor, whether in respect of unbilled purchases,
out-of-the-money positions or unperformed contracts for purchase.
21
"Reducing Letters of Credit" means any letters of credit (whether
standby letters of credit or commercial documentary letters of credit) that
(a) are Issued by an Issuing Bank pursuant to Article III, and (b) specifically
provide that the amount available for drawing under such letters of credit will
be reduced, automatically and without any further amendment or endorsement to
such letters of credit, by the amount of any payment or payments made to the
beneficiary of such Letter of Credit by the Borrower if such payment or payments
(i) are made through a bank and (ii) reference such letters of credit by the
letter of credit numbers thereof, notwithstanding the fact that such payment or
payments are not made pursuant to conforming and proper draws under such letters
of credit.
"Reducing L/C Borrowing" means any extension of credit by the Banks to
the Borrower for the purpose of funding any payment or payments made to the
beneficiary of a Reducing Letter of Credit by the Borrower if such payment or
payments (a) are made through the Issuing Bank of such Reducing Letter of
Credit, (b) reference the Reducing Letter of Credit by the letter of credit
number thereof, and (c) are not made pursuant to a conforming and proper draws
under such Reducing Letter of Credit.
"Replacement Bank" has the meaning specified in Section 4.08.
"Reportable Event" means, any of the events set forth in Section
4043(b) of ERISA or the regulations thereunder, other than any such event for
which the 30-day notice requirement under ERISA has been waived in regulations
issued by the PBGC.
"Reporting Effective Date" means the effective date of any report
required to be made hereunder.
"Required Banks" means, at any time, Banks holding at least two-thirds
of all of the Uncommitted Line Portions.
"Requirement of Law" means, as to any Person, any law (statutory or
common), treaty, rule or regulation or determination of an arbitrator or of a
Governmental Authority, in each case applicable to or binding upon the Person or
any of its property or to which the Person or any of its property is subject.
"Responsible Officer" means any of the following: ▇.▇. ▇▇▇▇▇▇▇▇ III,
▇▇▇▇▇▇ ▇. ▇▇▇▇ or ▇▇▇▇▇ ▇. ▇▇▇▇▇▇.
"Revolving Loan" has the meaning specified in Section 2.01.
"Security Agreements" means a security agreement, in form and
substance acceptable to the Collateral Agent and the Banks, duly executed by the
Borrower and delivered to the Collateral Agent for the benefit of the Banks
granting to the Collateral Agent, as collateral agent for the Banks, a first and
prior security interest in and Lien upon the Collateral, and all Hedging
Assignments.
"Short Position" means the aggregate number of MMBTUS of Product,
including that of the Prompt Month, which the Borrower has contracted to sell
(whether by sale of a contract on a commodities exchange or otherwise) or
deliver on exchange or under a swap
22
contract, including, without limitation, all option contracts representing the
obligation of the Borrower to sell Product at the option of a third party and in
each case for which a fixed sales price has been set. Short Positions shall be
expressed as a negative number.
"Subordinated Debt" means Indebtedness of the Borrower which has been
reported to the Banks and which has been subordinated to the Obligations
pursuant to a Subordination Agreement substantially in the form attached hereto
as Exhibit G.
"Subsidiary" of a Person means any corporation, association,
partnership, joint venture, limited liability company or other business entity
of which more than 50% of the voting stock or other equity interests (in the
case of Persons other than corporations), is owned or controlled directly or
indirectly by the Person, or one or more of the Subsidiaries of the Person, or a
combination thereof. Unless the context otherwise clearly requires, references
herein to a "Subsidiary" refer to a Subsidiary of the Borrower.
"Surety Instruments" means all letters of credit (including standby
and commercial), banker's acceptances, bank guaranties, shipside bonds, surety
bonds and similar instruments.
"Swap Bank" means BNP Paribas or Societe Generale, or any Affiliate of
BNP Paribas or Societe Generale, or any other Bank approved by the Agents.
"Swap Contract" means any agreement entered into with a Swap Bank,
whether or not in writing, relating to any single transaction that is a rate
swap, basis swap, forward rate transaction, commodity swap, commodity option,
equity or equity index swap or option, bond, note or ▇▇▇▇ option, interest rate
option, forward foreign exchange transaction, cap, collar or floor transaction,
currency swap, cross-currency rate swap, currency option or any other similar
transaction (including any option to enter into any of the foregoing) or any
combination of the foregoing and, unless the context clearly requires, any
master agreement relating to or governing any or all of the foregoing.
"Swap-Related Standby Letter of Credit" means any Letter of Credit
issued under the Letter of Credit Facility to support obligations of the
Borrower under a Swap Contract.
"Tangible Net Worth" means (a) the sum of the Borrower's assets, as
determined in accordance with GAAP, less (b) the sum of the Borrower's
liabilities excluding Subordinated Debt, as determined in accordance with GAAP,
less (c) all amounts due from employees, owners, Subsidiaries and Affiliates
other than Accounts permitted to be included as Eligible Accounts in the
calculation of the Borrowing Base Advance Cap, less (d) investments in Capital
Stock, less (e) the intangible assets of the Borrower, as determined in
accordance with GAAP.
"Taxes" means any and all present or future taxes, levies,
assessments, imposts, duties, deductions, fees, withholdings, or similar
charges, and all liabilities with respect thereto, excluding, in the case of
each Bank and the Administrative Agent, taxes imposed on or measured by each
Bank's net income or capital (with respect to franchise taxes or similar taxes)
by the jurisdiction (or any political subdivision thereof) under the laws of
which such Bank or the Administrative Agent, as the case may be, is organized or
maintains a lending office.
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"Three Party Agreement" means the Three Party Agreement Relating to
Lockbox Services (With Activation) dated April 15, 2002, among the Borrower,
Fortis Capital Corp. and Bank of America, N.A.
"Tier I Account" means an Eligible Account with a Tier I Account
Party.
"Tier I Account Party" means an Account Debtor which is approved by
the Banks in their sole discretion as a Tier I Account Party.
"Tier I Unbilled Account" means Unbilled Eligible Accounts with a Tier
I Account Party.
"Tier II Account" means Eligible Accounts with a Tier II Account
Party.
"Tier II Account Party" means any Account Debtor approved by the Banks
in their sole discretion as a Tier II Account Party.
"Tier II Unbilled Account" means Unbilled Eligible Accounts with a
Tier II Account Party.
"Total Liabilities" means, with respect to any Person on any date of
determination, all liabilities of such Person and its Subsidiaries that, in
accordance with GAAP, would be classified as liabilities on the balance sheet of
a Person conducting a business the same as or similar to that of such Person, as
determined on a Consolidated basis, but excluding to the extent otherwise
included therein any portion of the Subordinated Debt.
"Total Subscribed Line Portions" means the Dollar amount shown in
Schedule 2.01 across from the phrase "Total Subscribed Line Portions".
"Type" means either a Base Rate Loan or an Offshore Rate Loan.
"Unbilled Eligible Accounts" means Accounts of the Borrower for
Product which has been delivered to an Account Debtor and which would be
Eligible Accounts but for the fact that such Accounts have not actually been
invoiced at such time, net of, in each case (i) any accounts payable owing to
the Account Debtor from the Borrower on such Account and (ii) after application
thereof to any Eligible Accounts, Eligible Exchange Receivables, and Realizable
Unrealized Profits with such Account Debtor, other offsets against amounts owed
to such Account Debtor, whether in respect of unbilled purchases,
out-of-the-money positions or unperformed contracts for purchase.
"Uncommitted Line" means the aggregate Line limits of all the Banks as
is set forth on Schedule 2.01.
"Uncommitted Line Portion" means for each Bank the portion of each of
the Line limits assigned to such Bank as set forth on Schedule 2.01.
"Undelivered Product Value" means the lesser of the (a) cost or (b)
current market value of Product purchased by the Borrower under the Letters of
Credit but which has not been physically delivered to the Borrower. Undelivered
Product Value cannot simultaneously be included in an Eligible Exchange
Receivable.
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"Unfunded Pension Liability" means the excess of a Plan's benefit
liabilities under Section 4001(a)(16) of ERISA, over the current value of that
Plan's assets, determined in accordance with the assumptions used for funding
the Pension Plan pursuant to Section 412 of the Code for the applicable plan
year.
"United States" and "U.S." each means the United States of America.
"Unrealized ▇▇▇▇-to-Market Losses" means Borrower's unrealized
▇▇▇▇-to-Market losses as of the day of determination of Borrower's Borrowing
Base to be reported on a Borrowing Base Collateral Position Report. Such losses,
if any, to be calculated by subtracting (a) the sum of the current Liabilities
from Risk Management Activities and noncurrent Liabilities from Risk Management
Activities from (b) the sum of current Assets from Risk Management Activities
and noncurrent Assets from Risk Management Activities on the day of
determination of the Borrower's Borrowing Base. If this amount is less than
zero, the Unrealized ▇▇▇▇-to-Market Loss is the absolute value of the
difference. If this amount is greater than zero, the Unrealized ▇▇▇▇-to-Market
Loss is zero.
"Voting Interests" means shares of capital stock issued by a
corporation, or equivalent Equity Interests in any other Person, the holders of
which are ordinarily, in the absence of contingencies, entitled to vote for the
election of directors (or persons performing similar functions) of such Person,
even if the right to so vote has been suspended by the happening of such a
contingency.
1.02 Other Interpretive Provisions.
(a) The meanings of defined terms are equally applicable to the
singular and plural forms of the defined terms.
(b) The words "hereof," "herein," "hereunder" and similar words refer
to this Agreement as a whole and not to any particular provision of this
Agreement; and Subsection, Section, Schedule and Exhibit references are to this
Agreement unless otherwise specified.
(c) (i) The term "documents" includes any and all instruments,
documents, agreements, certificates, indentures, notices and other writings,
however evidenced.
(ii) The term "including" is not limiting and means "including
without limitation."
(iii) In the computation of periods of time from a specified date
to a later specified date, the word "from" means "from and including"; the words
"to" and "until" each mean "to but excluding," and the word "through" means "to
and including."
(d) Unless otherwise expressly provided herein, (i) references to
agreements (including this Agreement) and other contractual instruments shall be
deemed to include all subsequent amendments and other modifications thereto, but
only to the extent such amendments
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and other modifications are not prohibited by the terms of any Loan Document,
and (ii) references to any statute or regulation are to be construed as
including all statutory and regulatory provisions consolidating, amending,
replacing, supplementing or interpreting the statute or regulation.
(e) The captions and headings of this Agreement are for convenience
of reference only and shall not affect the interpretation of this Agreement.
(f) This Agreement and other Loan Documents may use several different
limitations, tests or measurements to regulate the same or similar matters. All
such limitations, tests and measurements are cumulative and shall each be
performed in accordance with their terms.
(g) This Agreement and the other Loan Documents are the result of
negotiations among and have been reviewed by counsel to the Agents, the Banks,
the Borrower and the other parties, and are the products of all parties.
Accordingly, they shall not be construed against the Banks or Agents merely
because of Agents' or Banks' involvement in their preparation.
1.03 Accounting Principles.
(a) Unless the context otherwise clearly requires, all accounting
terms not expressly defined herein shall be construed, and all financial
computations required under this Agreement shall be made in accordance with
GAAP, consistently applied.
(b) References herein to "fiscal year" and "fiscal quarter" refer to
such fiscal periods of the Borrower.
ARTICLE II
THE CREDITS
2.01 Amounts and Terms of Uncommitted Line.
(a) Each Bank severally agrees, on an UNCOMMITTED AND ABSOLUTELY
DISCRETIONARY basis, and on the terms and conditions set forth herein, to
consider making Loans, from time to time, to the Borrower under the Borrowing
Base Line (each such loan, a "Revolving Loan") on any Business Day during the
period from the Closing Date to the Expiration Date, in an aggregate amount not
to exceed at any time outstanding (i) such Bank's Uncommitted Line Portion for
the Borrowing Base Line; or (ii) the Dollar Advance Cap; provided, however,
that, after giving effect to any Borrowing of Revolving Loans, the Effective
Amount of all outstanding Revolving Loans, plus the Effective Amount of all L/C
Obligations, shall not exceed the Borrowing Base Advance Cap. At no time shall
the Dollar Advance Cap be exceeded.
(b) Advances Related to the Swap Contracts. In addition to advances
requested from time to time by the Borrower, in the event that either (i) any
amounts owing to BNP Paribas
26
or any of its Affiliates under any Swap Contract are not paid within two (2)
Business Days after such obligation arises, then BNP Paribas shall notify the
Administrative Agent of such failure to pay and the Administrative Agent
(without the necessity of any instructions or request from the Borrower) shall
make a Revolving Loan in accordance with the provisions of Section 2.03 of this
Agreement under the Borrowing Base Line for any amounts due by the Borrower to
BNP Paribas or any of its Affiliates under any Swap Contract, and then apply the
proceeds of such advance to pay to BNP Paribas or any of its Affiliates all
amounts owed to such Person under such Swap Contract. Upon making any such
Revolving Loan, the Administrative Agent shall send notice of such Revolving
Loan to the Borrower and the Banks. Any such advance shall initially be a Base
Rate Loan. In the event that any such advance made to fund BNP Paribas or any of
its Affiliates results in an advance in excess of the Borrowing Base Advance
Cap, the Banks shall have no duty to fund their pro rata share of any excess
resulting from such advance made to repay amounts owing to BNP Paribas or any of
its Affiliates under any Swap Contract, but BNP Paribas' or any of its
Affiliates' outstandings hereunder shall be deemed to be increased by the amount
of such excess. In the event any advance described above does exceed the
Borrowing Base Advance Cap, the Borrower shall pay to the Administrative Agent,
for the benefit of BNP Paribas or any of its Affiliates, the amount of such
excess, together with interest thereon, within one (1) Business Day after the
date of such advance and, notwithstanding anything to the contrary herein, the
Banks shall not share in such payment.
THE BORROWER ACKNOWLEDGES AND AGREES THAT THE BANKS HAVE ABSOLUTELY NO
DUTY TO FUND ANY REVOLVING LOAN REQUESTED BY THE BORROWER BUT WILL EVALUATE EACH
LOAN REQUEST AND IN EACH BANK'S ABSOLUTE AND SOLE DISCRETION WILL DECIDE WHETHER
TO FUND SUCH LOAN REQUEST. THE BORROWER FURTHER ACKNOWLEDGES AND AGREES THAT BNP
PARIBAS HAS ABSOLUTELY NO DUTY TO ENTER INTO ANY SWAP CONTRACT, AND THE ENTERING
INTO OF ANY SWAP CONTRACT SHALL BE AT BNP PARIBAS' ABSOLUTE AND SOLE DISCRETION.
2.02 Loan Accounts.
(a) The Loans made by each Bank and the Letters of Credit Issued by
an Issuing Bank shall be evidenced by one or more accounts or records maintained
by the Administrative Agent in the ordinary course of business. The accounts or
records maintained by the Administrative Agent shall be conclusive absent
manifest error of the amount of the Loans made by the Banks to the Borrower and
the Letters of Credit Issued for the account of the Borrower hereunder, and the
interest and payments thereon. 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 or any Letter of
Credit.
(b) Upon the request of any Bank made through the Administrative
Agent, the Loans made by such Bank may be evidenced by one or more Notes,
instead of loan accounts. Each such Bank may endorse on the schedules annexed to
its Note(s) the date, amount and maturity of each Loan made by it and the amount
of each payment of principal made by the Borrower with respect thereto. Each
such Bank is irrevocably authorized by the Borrower to endorse its Note(s) and
each Bank's record shall be conclusive absent manifest error; provided,
27
however, that the failure of a Bank to make, or an error in making, a notation
thereon with respect to any Loan shall not limit or otherwise affect the
Obligations of the Borrower hereunder or under any such Note to such Bank.
2.03 Procedure for Borrowing.
(a) Each Borrowing of Revolving Loans consisting only of Base Rate
Loans, if approved by the Banks in their sole discretion, shall be made upon the
Borrower's irrevocable written notice delivered to the Administrative Agent and
the Banks in the form of a Notice of Borrowing (Revolving Loan), which notice
must be received by the Administrative Agent and the Banks by no later than
12:00 p.m. noon (New York City time) on the Borrowing Date specifying the amount
of the Borrowing. Each such Notice of Borrowing shall be by electronic transfer
or facsimile, confirmed immediately in an original writing. Each Borrowing of
Revolving Loans that includes any Offshore Rate Loans, if approved by the Banks
in their sole discretion, shall be made upon the Borrower's irrevocable written
notice delivered to the Administrative Agent and the Banks in the form of a
Notice of Borrowing (which notice must be received by the Administrative Agent
by no later than 12:00 p.m. noon (New York City time) four (4) Business Days
prior to the requested Borrowing Date), specifying the amount of the Borrowing.
Each such Notice of Borrowing shall be by electronic transfer or facsimile,
confirmed immediately in an original writing. Each requested Offshore Rate Loan
must have an Offshore Effective Amount of at least $15,000,000.
(b) The Administrative Agent will promptly notify each Bank of its
receipt of any Notice of Borrowing and of the amount of such Bank's Pro Rata
Share of that Borrowing.
(c) Unless a Bank has provided the Administrative Agent with, and the
Administrative Agent has actually received, a written notice in the form
attached hereto as Exhibit H prior to 5:00 p.m. (New York City time) one
Business Day immediately prior to the proposed Borrowing Date that such Bank
does not approve further Borrowings and/or Issuances of Letters of Credit, if
the Administrative Agent elects in its sole discretion to advance a Loan
pursuant to a Notice of Borrowing, each Bank will be deemed to have approved
such Borrowing and will make the amount of its Pro Rata Share of such Borrowing
available to the Administrative Agent for the account of the Borrower at the
Administrative Agent's payment office by 3:00 p.m. (New York City time) on the
Borrowing Date requested by the Borrower in funds immediately available to the
Administrative Agent. The proceeds of all such Loans will then be made available
to the Borrower by the Administrative Agent at such office by crediting the Lock
Box with the aggregate of the amounts made available to the Administrative Agent
by the Banks and in like funds as received by the Administrative Agent. If any
Bank in a timely manner provides the Administrative Agent with such a written
notice of its disapproval of further Borrowings and/or Issuances of Letters of
Credit, then the Administrative Agent shall notify the Borrower that one or more
of the Banks have elected not to fund further Borrowings and/or participate in
further Issuances of Letters of Credit and whether a Bank (or Banks) has (have)
elected to become the Approving Bank(s) thereby triggering the Conversion to
Reduced Funding Banks Date.
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2.04 Conversion and Continuation Elections.
(a) Borrower may, upon irrevocable written notice to the
Administrative Agent in accordance with Subsection 2.04(b):
(i) elect, as of any Business Day, in the case of Base Rate
Loans, or as of the last day of the applicable Interest Period, in the case
of any Offshore Rate Loan, to convert any such Loans into Loans of any
other Type (provided, however, that the Offshore Effective Amount of each
Offshore Rate Loan must be at least $15,000,000); or
(ii) elect, as of the last day of the applicable Interest
Period, to continue any Revolving Loans having Interest Periods expiring on
such day (provided, however, that the Offshore Effective Amount of each
Offshore Rate Loan must be at least $15,000,000);
provided, however, that if at any time the aggregate amount of Offshore Rate
Loans in respect of any Borrowing is reduced, by payment, prepayment, or
conversion of part thereof, to have an Offshore Effective Amount of less than
$15,000,000, such Offshore Rate Loans shall automatically convert into Base Rate
Loans, and on and after such date the right of the Borrower to continue such
Loans as, and convert such Loans into, Offshore Rate Loans shall terminate.
(b) Borrower shall deliver a Notice of Conversion/Continuation to be
received by the Administrative Agent not later than 12:00 p.m. noon (New York
City time) on the Conversion/Continuation Date if the Loans are to be converted
into Base Rate Loans; and four (4) Business Days in advance of the
Conversion/Continuation Date, if the Loans are to be converted into or continued
as Offshore Rate Loans, specifying:
(i) the proposed Conversion/Continuation Date;
(ii) the aggregate amount of Loans to be converted or continued;
(iii) the Type of Loans resulting from the proposed conversion or
continuation; and
(iv) other than in the case of conversions into Base Rate Loans,
the duration of the requested Interest Period.
(c) If upon the expiration of any Interest Period applicable to
Offshore Rate Loans, the Borrower has failed to timely select a new Interest
Period to be applicable to its Offshore Rate Loans, or if any Default or Event
of Default then exists, the Borrower shall be deemed to have elected to convert
such Offshore Rate Loans into Base Rate Loans effective as of the expiration
date of such Interest Period.
(d) The Administrative Agent will promptly notify each Bank of its
receipt of a Notice of Conversion/Continuation, or, if no timely notice is
provided by the Borrower, the Administrative Agent will promptly notify each
Bank of the details of any automatic conversion. All conversions and
continuations shall be made ratably according to the respective outstanding
principal amounts of the Loans, with respect to which the notice was given, held
by each Bank.
29
(e) Unless the Required Banks otherwise agree, during the existence
of a Default or Event of Default, the Borrower may not elect to have a Loan
converted into or continued as an Offshore Rate Loan.
(f) After giving effect to any Borrowing, conversion or continuation
of Loans, there may not be more than five (5) Interest Periods in effect.
(g) The Administrative Agent will promptly notify, in writing, each
Bank of the amount of such Bank's Pro Rata Share of that Borrowing.
(h) If any Bank has provided the Administrative Agent with, and the
Administrative Agent has actually received, a written notice in the form of
Exhibit H by 5:00 p.m. (New York City time) one Business Day immediately prior
to the requested Conversion/Continuation Date, then the Administrative Agent
shall notify the Borrower and the other Banks by no later than 6:00 p.m. (New
York City time) that one or more of the Banks has (have) elected not to
convert/continue such Loan and whether Bank(s) has (have) elected to become the
Approving Bank(s) thereby triggering the Conversion to Reduced Funding Banks
Date.
2.05 Optional Prepayments The Borrower may, at any time or from time
to time, upon the Borrower's irrevocable written notice to the Administrative
Agent received prior to 1:00 p.m. (New York City time) on the date of
prepayment, prepay Loans in whole or in part without premium except any amounts
due by Borrower pursuant to Article IV. The Administrative Agent will promptly
notify each Bank of its receipt of any such prepayment, and of such Bank's Pro
Rata Share of such prepayment.
2.06 Mandatory Prepayments of Loans; Mandatory Commitment Reductions.
If on any date the Effective Amount of L/C Obligations exceeds the L/C Cap, the
Borrower shall Cash Collateralize on such date the outstanding Letters of Credit
in an amount equal to the excess above any such cap. If on any date after giving
effect to any Cash Collateralization made on such date pursuant to the preceding
sentence, the Effective Amount of all Revolving Loans then outstanding plus the
Effective Amount of all L/C Obligations exceeds the lesser of (a) the Collateral
Position or (b) the total Uncommitted Line, or if the Effective Amount of all
Revolving Loans under the Borrowing Base Line then outstanding, plus the
Effective Amount of all L/C Obligations under such Line exceed the Borrowing
Base Advance Cap, the Borrower shall immediately, and without notice or demand,
prepay the outstanding principal amount of the Revolving Loans and L/C Advances
by an amount equal to the applicable excess.
2.07 Repayment. The Borrower shall repay the principal amount of each
Revolving Loan to the Administrative Agent on behalf of the Banks, on the
Advance Maturity Date for such Loan. All amounts owing a Swap Bank under any
Swap Contract, to the extent such amounts have not been repaid from the proceeds
of a Revolving Loan, shall be paid on demand, or if no demand is made, on the
first (1st) Business Day after the Borrower receives notice that such amount was
advanced by or becomes owing to a Swap Bank.
30
2.08 Interest.
(a) Each Revolving Loan (except for a Revolving Loan made as a result
of a drawing under a Letter of Credit or a Reducing L/C Borrowing) shall bear
interest on the outstanding principal amount thereof from the applicable
Borrowing Date at a floating rate per annum equal to the Base Rate plus the
Applicable Margin at all times such Loan is a Base Rate Loan or at the Offshore
Rate plus the Applicable Margin at all times such Loan is an Offshore Rate Loan.
Each Revolving Loan made as a result of a drawing under a Letter of Credit or a
Reducing L/C Borrowing, all amounts owing to BNP Paribas with respect to any
Swap Contract shall bear interest on the outstanding principal amount thereof
from the date funded at a floating rate per annum equal to the Base Rate plus
the Applicable Margin until such Loan has been outstanding for more than two (2)
Business Days and, thereafter, shall bear interest on the outstanding principal
amount thereof at a floating rate per annum equal to the Base Rate, plus three
percent (3.0%) per annum (the "Default Rate").
(b) Interest on each Revolving Loan shall be paid upon demand, or if
no demand is made, shall be paid in arrears on each Interest Payment Date.
(c) Notwithstanding subsection (a) of this Section, if any amount of
principal of or interest on any Loan, or any other amount payable hereunder or
under any other Loan Document is not paid in full when due (whether at stated
maturity, by acceleration, demand or otherwise), the Borrower agrees to pay
interest on such unpaid principal or other amount, from the date such amount
becomes due until the date such amount is paid in full, and after as well as
before any entry of judgment thereon to the extent permitted by law, payable on
demand, at a fluctuating rate per annum equal to the Default Rate.
(d) Anything herein to the contrary notwithstanding, the Obligations
of the Borrower to any Bank hereunder shall be subject to the limitation that
payments of interest shall not be required for any period for which interest is
computed hereunder, to the extent (but only to the extent) that contracting for
or receiving such payment by such Bank would be contrary to the provisions of
any law applicable to such Bank limiting the highest rate of interest that may
be lawfully contracted for, charged or received by such Bank, and in such event
the Borrower shall pay such Bank interest at the highest rate permitted by
applicable law.
(e) Regardless of any provision contained in any Note or in any of
the Loan Documents, none of the Banks shall ever be deemed to have contracted
for or be entitled to receive, collect or apply as interest under any such Note
or any Loan Document, or otherwise, any amount in excess of the maximum rate of
interest permitted to be charged by applicable law, and, in the event that any
of the Banks ever receive, collect or apply as interest any such excess, such
amount which would be excessive interest shall be applied to the reduction of
the unpaid principal balance of the Note, and, if the principal balance of such
Note is paid in full, any remaining excess shall forthwith be paid to the
Borrower. In determining whether or not the interest paid or payable under any
specific contingency exceeds the highest lawful rate, the Borrower and such Bank
shall, to the maximum extent permitted under applicable law, (i) characterize
any non-principal payment as an expense, fee, or premium, rather than as
interest, (ii) exclude voluntary prepayments and the effect thereof, and (iii)
spread the total amount of interest throughout the entire contemplated term of
such Note so that the interest rate is uniform throughout such term; provided,
however, that if all Obligations under the Note and all Loan Documents are
performed in full prior to the end of the full contemplated term thereof,
31
and if the interest received for the actual term thereof exceeds the maximum
lawful rate, such Bank shall refund to the Borrower the amount of such excess,
or credit the amount of such excess against the aggregate unpaid principal
balance of such Bank's Note at the time in question.
2.09 Fees. In addition to certain fees described in Section 3.08, the
Borrower shall pay to the Administrative Agent, for the account of each Bank,
fees in accordance with a separate letter agreement between the Agents, the
Banks and the Borrower. The Borrower shall also pay to the Agents, for their own
accounts, fees in accordance with a separate letter agreement between the Agents
and the Borrower.
2.10 Computation of Fees and Interest.
(a) All other computations of fees and interest shall be made on the
basis of a 360-day year and actual days elapsed (which results in more interest
being paid than if computed on the basis of a 365-day year). Interest and fees
shall accrue during each period during which interest or such fees are computed
from the first day thereof through the last day thereof.
(b) Each determination of an interest rate by the Administrative
Agent shall be conclusive and binding on the Borrower and the Banks in the
absence of manifest error.
2.11 Payments by the Borrower.
(a) All payments to be made by the Borrower shall be made without
set-off, recoupment or counterclaim. Except as otherwise expressly provided
herein, all payments by the Borrower shall be made to the Administrative Agent
for the account of the Banks at the Administrative Agent's Payment Office, and
shall be made in dollars and in immediately available funds, no later than 1:00
p.m. (New York City time) on the date specified herein. The Administrative Agent
will promptly distribute to each Bank its Pro Rata Share or Adjusted Pro Rata
Share, as the case may be, of such payment in like funds as received. Any
payment received by the Administrative Agent later than 1:00 p.m. (New York City
time) shall be deemed to have been received on the following Business Day and
any applicable interest or fee shall continue to accrue.
(b) Subject to the provisions set forth in the definition of
"Interest Period" herein, whenever any payment is due on a day other than a
Business Day, such payment shall be made on the following Business Day, and such
extension of time shall in such case be included in the computation of interest
or fees, as the case may be.
(c) Unless the Administrative Agent receives notice from the Borrower
prior to the date on which any payment is due to the Banks that the Borrower
will not make such payment in full as and when required, the Administrative
Agent may assume that the Borrower has made such payment in full to the
Administrative Agent on such date in immediately available funds and the
Administrative Agent may (but shall not be so required), in reliance upon such
assumption, distribute to each Bank on such due date an amount equal to the
amount then due such Bank. If and to the extent the Borrower has not made such
payment in full to the Administrative Agent, each Bank shall repay to the
Administrative Agent on demand such amount distributed to such Bank, together
with interest thereon at the Federal Funds Rate for each day from the date such
amount is distributed to such Bank until the date repaid.
32
2.12 Payments by the Banks to the Administrative Agent. If and to the
extent any Bank shall not have made its full amount available to the
Administrative Agent in immediately available funds and the Administrative Agent
in such circumstances has made available to the Borrower such amount, that Bank
shall on the Business Day following such Borrowing Date make such amount
available to the Administrative Agent, together with interest at the Federal
Funds Rate for each day during such period. A notice of the Administrative Agent
submitted to any Bank with respect to amounts owing under this Section 2.12
shall be conclusive, absent manifest error. If such amount is so made available,
such payment to the Administrative Agent shall constitute such Bank's Loan on
the date of Borrowing for all purposes of this Agreement. If such amount is not
made available to the Administrative Agent on the Business Day following the
Borrowing Date, the Administrative Agent will notify the Borrower of such
failure to fund and, upon demand by the Administrative Agent, the Borrower shall
pay such amount to the Administrative Agent for the Administrative Agent's
account, together with interest thereon for each day elapsed since the date of
such Borrowing, at a rate per annum equal to the interest rate applicable at the
time to the Loans comprising such Borrowing.
2.13 Sharing of Payments, Etc. If, other than as expressly provided
elsewhere herein, any Bank shall obtain on account of the Loans made by it any
payment (whether voluntary, involuntary, through the exercise of any right of
set-off, or otherwise) in excess of its Pro Rata Share or Adjusted Pro Rata
Share, as the case may be at such time (other than payments to BNP Paribas with
respect to advances made in excess of the Borrowing Base Advance Cap as a result
of payment under a Swap Contract), such Bank shall immediately (a) notify the
Administrative Agent of such fact, and (b) purchase from the other Banks such
participations in the Loans made by them as shall be necessary to cause such
purchasing Bank to share the excess payment pro rata with each of them;
provided, however, that if all or any portion of such excess payment is
thereafter recovered from the purchasing Bank, such purchase shall to that
extent be rescinded and each other Bank shall repay to the purchasing Bank the
purchase price paid therefor, together with an amount equal to such paying
Bank's ratable share (according to the proportion of (i) the amount of such
paying Bank's required repayment to (ii) the total amount so recovered from the
purchasing Bank) of any interest or other amount paid or payable by the
purchasing Bank in respect of the total amount so recovered. The Borrower agrees
that any Bank so purchasing a participation from another Bank may, to the
fullest extent permitted by law, exercise all its rights of payment (including
the right of set-off, but subject to Section 11.09) with respect to such
participation as fully as if such Bank were the direct creditor of the Borrower
in the amount of such participation. the Administrative Agent will keep records
(which shall be conclusive and binding in the absence of manifest error) of
participations purchased under this Section and will in each case notify the
Banks following any such purchases or repayments.
2.14 The Election of Approving Banks to Continue Funding. If one or
more Banks (the "Declining Bank" or "Declining Banks") provides the
Administrative Agent with, and the Administrative Agent has actually received, a
written notice in the form of Exhibit H for reasons other than a Default and the
other Bank or Banks do approve further Revolving Loans (including the conversion
and extension of such Revolving Loans) or the further issuances of,
33
extensions of, the automatic renewal of or amendments to Letters of Credit, the
Administrative Agent shall notify the Banks by 6:00 p.m. (New York City time)
that same day. If the Bank or Banks which are not the Declining Banks desire,
they may (on a pro rata basis among the Banks that have elected to continue
funding) make the full or partial amount of such requested Revolving Loan or
issue or amend the requested Letter of Credit irrespective of the Declining
Banks' disapproval (in such case, the Banks that elect to continue funding shall
be referred to as the "Approving Banks"). In such event, from such date (the
"Conversion to Reduced Funding Banks Date") forward (a) all subsequent Revolving
Loans and Issuances of Letters of Credit or Amendments to Letters of Credit that
increase the face amount of a Letter of Credit or extend the term of a Letter of
Credit shall be made unilaterally by the Approving Banks and no Letter of Credit
thereafter Issued shall be participated in by the Declining Banks, (b) all
Banks' interests in the Collateral and loan management decisions shall be
pro-rata based on each Bank's total Effective Amount of Revolving Loans, plus
the Effective Amounts of such Bank's L/C Obligations from time to time, and (c)
the Approving Banks' Pro Rata Share of the Uncommitted Line Portion shall be
increased on the basis of each such advance and Issuance of a Letter of Credit
made by such approving Bank.
Notwithstanding the foregoing, however, for purposes of allocating
repayments prior to the occurrence of a Default hereunder, the Adjusted Pro Rata
Share of the Uncommitted Line of each Bank shall remain fixed at the percentage
held by such Bank the day before the Conversion to Reduced Funding Banks Date,
without respect to any changes which may subsequently occur in such Bank's Pro
Rata Share of the Uncommitted Line except that in the event that Obligations
become owing to BNP Paribas and its Affiliates after such date pursuant to Swap
Contracts as a result of contracts or transactions existing on the Conversion to
Reduced Funding Banks Date, the Adjusted Pro Rata Share of each Bank shall be
recalculated to account for the increase in Obligations that have become owing
to BNP Paribas or its Affiliates until such time, if any, that all Declining
Banks are fully repaid. Upon the occurrence of a Default and thereafter,
repayments shall be allocated according to the Adjusted Pro Rata Share of the
outstanding balances held by the Banks on the date of Default except that in the
event that Obligations become owing to BNP Paribas or its Affiliates after such
date pursuant to Swap Contracts as a result of contracts or transactions
existing on the date of such Default, the Adjusted Pro Rata Share of each Bank
shall be recalculated to account for the increase in Obligations owing to BNP
Paribas or its Affiliates.
2.15 Payments from Guarantors and Liquidation of Collateral.
Notwithstanding anything to the contrary contained herein, in the event
repayment is made to the Banks by Guarantors or pursuant to a liquidation of
Collateral, such repayment shall be shared by the Banks on the basis of each
Bank's then existing Adjusted Pro Rata Share rather than each Bank's Pro Rata
Share.
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ARTICLE III
THE LETTERS OF CREDIT
3.01 The Letter of Credit Lines.
(a) On an uncommitted basis and on the terms and conditions set forth
herein and unless a Bank has provided the Administrative Agent with, and the
Administrative Agent has actually received, a written notice in the form
attached hereto as Exhibit H prior to 5:00 p.m. (New York City time) one
Business Day immediately prior to the proposed date of Issuance of a Letter of
Credit that such Bank does not approve further Borrowings and/or Issuances of
Letters of Credit, (i) each Issuing Bank agrees, (A) from time to time on any
Business Day during the period from the Closing Date to the Expiration Date, to
consider the Issuance of Letters of Credit for the account of the Borrower under
the Borrowing Base Line and to consider whether to amend or renew Letters of
Credit previously Issued by it, in accordance with Subsections 3.02(b), 3.02(c),
and 3.02(d) and (B) to honor drafts under the Letters of Credit; and (ii) each
of the Banks will be deemed to have approved such Issuance, amendment or
renewal, and shall participate in Letters of Credit Issued for the account of
the Borrower. If any Bank gives the Administrative Agent timely notice of its
disapproval of further Borrowings and/or Issuances of Letters of Credit, then
the Administrative Agent shall notify the Borrower that one or more of the Banks
have elected not to fund further Borrowings or participate in the further
Issuances of Letters of Credit, and whether a Bank (or Banks) has (have) elected
to become the Approving Bank(s) thereby triggering the Conversion to Reduced
Funding Banks Date. No Declining Bank shall have any obligation to or shall be
deemed to have participated in any Letters of Credit which are Issued on or
after the Conversion to Reduced Funding Banks Date. No Swap-Related Standby
Letter of Credit shall be Issued if, after giving effect to such Issuance, the
outstanding amounts of all Swap-Related Standby Letters of Credit plus the
▇▇▇▇-to-Market value of amounts owed to Swap Banks by the Borrower under Swap
Contracts would exceed $50,000,000. Within the foregoing limits, and subject to
the other terms and conditions hereof including, without limitation, the
approval of all Banks (or after the Conversion to Reduced Funding Banks, all
Approving Banks) in their sole discretion, the Borrower's ability to request
that an Issuing Bank Issue Letters of Credit shall be fully revolving, and,
accordingly, the Borrower may, during the foregoing period, request that an
Issuing Bank Issue Letters of Credit to replace Letters of Credit which have
expired or which have been drawn upon and reimbursed. Borrower acknowledges and
agrees that the Existing Letters of Credit are an Obligation under this
Agreement.
(b) Each Issuing Bank is under no obligation to consider the Issuance
of or to Issue any Letter of Credit unless all Banks shall have consented
(deemed or explicit) to the Issuance of such Letter of Credit in their sole
discretion. An Issuing Bank is under no obligation to Issue any Letter of Credit
if:
(i) any order, judgment or decree of any Governmental
Authority or arbitrator shall by its terms purport to enjoin or restrain
such Issuing Bank from Issuing such Letter of Credit, or any Requirement of
Law applicable to such Issuing Bank or any request or directive (whether or
not having the force of law) from any Governmental Authority with
jurisdiction over such Issuing Bank shall prohibit, or request that such
Issuing Bank refrain from, the issuance of letters of credit generally or
such Letter of Credit in particular or shall impose upon such Issuing Bank
with respect to such Letter of Credit any restriction, reserve or capital
requirement (for which such Issuing Bank is not otherwise compensated
hereunder) not in effect on the Closing Date, or shall impose upon such
Issuing Bank any unreimbursed loss, cost or expense which was not
applicable on the Closing Date and which such Issuing Bank in good ▇▇▇▇▇
▇▇▇▇▇ material to it;
35
(ii) such Issuing Bank has received written notice from any
Bank, any other Issuing Bank, the Administrative Agent or the Borrower, on
or prior to the Business Day prior to the requested date of Issuance of
such Letter of Credit, that one or more of the applicable conditions
contained in Article V is not then satisfied;
(iii) the expiry date of any requested Letter of Credit is after
the earlier to occur of (A) 90 days after the date of Issuance of such
Letter of Credit or (B) the Maturity Date, unless all the Banks have
approved such expiry date in writing, but any Swap-Related Standby Letter
of Credit may by its terms be renewable for successive 90-day periods
unless a notice that the applicable Issuing Bank declines to renew such
Letter of Credit is given to the applicable Issuing Bank and the
Administrative Agent on or prior to any date for notice of non-renewal to
the beneficiary set forth in such Swap-Related Standby Letter of Credit,
but in any event at least five Business Days prior to the date of the
notice of non-renewal of such Swap-Related Standby Letter of Credit, any
such automatic renewal of a Letter of Credit being subject to the
fulfillment of the applicable conditions set forth in Article V; provided
that the terms of each of the Swap-Related Standby Letters of Credit that
is automatically renewable (1) shall require the applicable Issuing Bank to
give the beneficiary of such Swap-Related Standby Letter of Credit notice
of any non-renewal prior to the expiry date, (2) shall permit such
beneficiary, upon receipt of such notice, to draw under such Swap-Related
Standby Letter of Credit prior to the expiry date of the Swap-Related
Standby Letter of Credit, and (3) shall not permit the expiry date (after
giving effect to any renewal) of such Swap-Related Standby Letter of Credit
in any event to be extended to a date that is later than the Maturity Date.
If a notice of non-renewal is given by the applicable Issuing Bank pursuant
to the immediately preceding sentence, the related Swap-Related Standby
Letter of Credit shall expire on its expiry date;
(iv) the expiry date of any such requested Letter of Credit is
prior to the maturity date of any financial obligation to be supported by
the requested Letter of Credit;
(v) such requested Letter of Credit is not in form and
substance acceptable to such Issuing Bank, or the Issuance of a Letter of
Credit shall violate any applicable policies of such Issuing Bank;
(vi) such Letter of Credit is for the purpose of supporting the
Issuance of any letter of credit by any other Person;
(vii) such Letter of Credit is denominated in a currency other
than Dollars; or
(viii) the amount of such requested Letter of Credit together
with outstanding Letters of Credit and Revolving Loans exceeds the
Borrowing Base Advance Cap.
3.02 Issuance, Amendment and Renewal of Letters of Credit.
(a) Each Letter of Credit which is Issued hereunder shall be Issued
upon the irrevocable written request of the Borrower pursuant to a Notice of
Borrowing (Letter of Credit) in the applicable form attached hereto as Exhibit A
received by an Issuing Bank (with a copy
36
sent by the Borrower to the Administrative Agent) by no later than 12:00 p.m.
noon (New York City time) on the proposed date of Issuance. Each such request
for Issuance of a Letter of Credit shall be by electronic transfer or facsimile,
confirmed immediately in an original writing or by electronic transfer, in the
form of an L/C Application, and shall specify in form and detail satisfactory to
such Issuing Bank: (i) the proposed date of Issuance of the Letter of Credit
(which shall be a Business Day); (ii) whether the requested Letter of Credit
would be a commercial documentary letter of credit, Swap-Related Standby Letter
of Credit or other standby letter of credit; (iii) the face amount of the Letter
of Credit; (iv) the expiry date of the Letter of Credit; (v) the name and
address of the beneficiary thereof; (vi) the documents to be presented by the
beneficiary of the Letter of Credit in case of any drawing thereunder; (vii) the
full text of any certificate to be presented by the beneficiary in case of any
drawing thereunder; and (viii) such other matters as such Issuing Bank may
require. Upon receipt of such request, the Administrative Agent will promptly
notify the Banks of the receipt by it of any L/C Application. No such Issuance
will be made if prior to 5:00 p.m. (New York City time) one Business Day
immediately prior to the proposed date of Issuance, a Bank has provided the
Administrative Agent with, and the Administrative Agent has actually received, a
written notice in the form of Exhibit H. If the Administrative Agent does timely
receive a written notice in the form of Exhibit H, the Administrative Agent
shall notify the Borrower, such Issuing Bank and the Banks by 6:00 p.m. (New
York City time) one Business Day immediately prior to the proposed date of
Issuance, and the proposed Letter of Credit will not be Issued, unless one or
more of the Banks have elected to become Approving Banks thereby triggering the
Conversion to Reduced Funding Banks Date.
(b) From time to time while a Letter of Credit is outstanding and
prior to the Expiration Date, an Issuing Bank will, upon the written request of
the Borrower received by such Issuing Bank (with a copy sent by the Borrower to
the Administrative Agent) by no later than 12:00 p.m. noon (New York City time)
on the proposed date of amendment, consider the amendment of any Letter of
Credit Issued by it. Each such request for amendment of a Letter of Credit shall
be made by electronic transfer or facsimile, confirmed immediately in an
original writing or by electronic transfer, made in the form of an L/C Amendment
Application and shall specify in form and detail satisfactory to such Issuing
Bank and the Administrative Agent: (i) the Letter of Credit to be amended; (ii)
the proposed date of amendment of the Letter of Credit (which shall be a
Business Day); (iii) the nature of the proposed amendment; and (iv) such other
matters as such Issuing Bank may require. Such Issuing Bank shall be under no
obligation to amend any Letter of Credit. No such amendment will be made if a
Bank has provided the Administrative Agent with, and the Administrative Agent
has actually received, a written notice in the form of Exhibit H by 5:00 p.m.
(New York City time) on the Business Day immediately preceding the proposed date
of amendment. If the Administrative Agent does timely receive a written notice
in the form of Exhibit H, the Administrative Agent shall notify the Borrower,
such Issuing Bank and the Banks by 6:00 p.m. (New York City time) one Business
Day immediately prior to the proposed date of amendment, and the Letter of
Credit will not be amended; provided, however, that one or more Banks may elect
to become the Approving Banks and amend such Letter of Credit, thereby
triggering the Conversion to Reduced Funding Banks Date.
(c) The Issuing Banks and the Banks agree that, while a Letter of
Credit is outstanding and prior to the Expiration Date, at the option of the
Borrower and upon the written request of the Borrower received by an Issuing
Bank (with a copy sent to the Administrative
37
Agent and the other Issuing Banks) by no later than 12:00 p.m. noon (New York
City time) on the proposed date of renewal, the Issuing Bank may consider the
renewal of any Letter of Credit Issued by it. No such renewal will be made if
prior to 5:00 p.m. (New York City time) one Business Day immediately prior to
the proposed date of renewal, a Bank has provided the Administrative Agent with,
and the Administrative Agent has actually received, a written notice in the form
of Exhibit H. If the Administrative Agent does timely receive a written notice
in the form of Exhibit H, the Administrative Agent shall notify the Borrower,
such Issuing Bank and the Banks by 6:00 p.m. (New York City time) one Business
Day immediately prior to the proposed date of renewal, and the Letter of Credit
will not be renewed, unless one or more of the Banks have elected to become
Approving Banks. Each such request for renewal of a Letter of Credit made by the
Borrower shall be made by electronic transfer or facsimile, confirmed
immediately in an original writing or by electronic transfer, in the form of an
L/C Amendment Application, and shall specify in form and detail satisfactory to
such Issuing Bank and the Banks: (i) the Letter of Credit to be renewed; (ii)
the proposed date of renewal of the Letter of Credit (which shall be a Business
Day); (iii) the revised expiry date of the Letter of Credit; and (iv) such other
matters as such Issuing Bank may require. The Issuing Banks shall be under no
obligation to renew any Letter of Credit.
(d) If any outstanding Letter of Credit Issued by an Issuing Bank
shall provide that it shall be automatically renewed unless the beneficiary
thereof receives notice from such Issuing Bank that such Letter of Credit shall
not be renewed, and if at the time of renewal such Issuing Bank would be
entitled to authorize the automatic renewal of such Letter of Credit in
accordance with this Subsection 3.02(d) upon the request of the Borrower, then
such Issuing Bank shall nonetheless be permitted to allow such Letter of Credit
to renew, and, provided that no Bank has elected to become a Declining Bank by
5:00 p.m. one Business Day immediately prior to the day that the beneficiary of
such Letter of Credit would receive notice from the Issuing Bank that such
Letter of Credit shall not be renewed, the Borrower and the Banks hereby
authorize such renewal, and, accordingly, such Issuing Bank shall be deemed to
have received an L/C Amendment Application from the Borrower requesting such
renewal. The Issuing Banks shall be under no obligation to allow the automatic
renewal of any Letter of Credit.
(e) Any Issuing Bank may, at its election, deliver any notices of
termination or other communications to any Letter of Credit beneficiary or
transferee, and take any other action as necessary or appropriate, at any time
and from time to time, in order to cause the expiry date of such Letter of
Credit to be a date not later than the Expiration Date.
(f) This Agreement shall control in the event of any conflict with
any L/C-Related Document (other than any Letter of Credit).
(g) Each Issuing Bank will also deliver to the Administrative Agent a
true and complete copy of each Letter of Credit or amendment to or renewal of a
Letter of Credit Issued by it.
38
3.03 Risk Participations, Drawings, Reducing Letters of Credit and
Reimbursements.
(a) Immediately upon the Issuance of each Letter of Credit by an
Issuing Bank which is Issued prior to the Conversion to Reduced Funding Banks
Date, each Bank shall be deemed to, and hereby irrevocably and unconditionally
agrees to, purchase from such Issuing Bank a participation in such Letter of
Credit and each drawing or Reducing Letter of Credit Borrowing thereunder in an
amount equal to the product of (i) the Pro Rata Share of such Bank, times (ii)
the maximum amount available to be drawn under such Letter of Credit and the
amount of such drawing or Reducing Letter of Credit Borrowing, respectively. All
Letters of Credit Issued after the Conversion to Reduced Funding Banks Date
shall be participated in only by the Approving Banks. For purposes of Section
2.01, each Issuance of a Letter of Credit shall be deemed to utilize the
Uncommitted Line Portion of each Bank by an amount equal to the amount of such
participation.
(b) In the event of any request for a drawing under a Letter of
Credit Issued by an Issuing Bank by the beneficiary or transferee thereof, such
Issuing Bank will promptly notify the Borrower. Any notice given by an Issuing
Bank or the Administrative Agent pursuant to this Subsection 3.03(b) may be oral
if immediately confirmed in writing (including by facsimile); provided, however,
that the lack of such an immediate confirmation shall not affect the
conclusiveness or binding effect of such notice. The Borrower shall reimburse an
Issuing Bank prior to 5:00 p.m. (New York City time), on each date that any
amount is paid by such Issuing Bank under any Letter of Credit or to the
beneficiary of a Reducing Letter of Credit in the form of a Reducing L/C
Borrowing (each such date, an "Honor Date"), in an amount equal to the amount so
paid by such Issuing Bank. In the event the Borrower fails to reimburse such
Issuing Bank for the full amount of any drawing under any Letter of Credit or of
any Reducing L/C Borrowing, as the case may be, by 5:00 p.m. (New York City
time) on the Honor Date, such Issuing Bank will promptly notify the
Administrative Agent and the Administrative Agent will promptly notify each Bank
thereof, and the Borrower shall be deemed to have requested that Revolving Loans
be made by the Banks to be disbursed to such Issuing Bank not later than one (1)
Business Day after the Honor Date under such Letter of Credit, subject to the
amount of the unutilized portion of the Borrowing Base Line.
(c) In the event of any request for a Reducing L/C Borrowing by the
Borrower in association with any Reducing Letter of Credit, the amount available
for drawing under such Reducing Letter of Credit will be reduced automatically,
and without any further amendment or endorsement to such Reducing Letter of
Credit, by the amount actually paid to such beneficiary, notwithstanding the
fact that the payment creating such Reducing L/C Borrowing is not made pursuant
to a conforming and proper draw under the corresponding Reducing Letter of
Credit; provided, however, that if any Bank has given the Issuing Banks, the
Administrative Agent, the Borrower and each of the other Banks written notice
that such Bank objects to further Reducing L/C Borrowings at least three (3)
Business Days prior to the date the Borrower requests the Reducing L/C
Borrowing, then the relevant Issuing Bank will not make such Reducing L/C
Borrowing unless all Banks consent thereto.
(d) Each Bank shall upon any notice pursuant to Subsection 3.03(b)
make available to the Administrative Agent for the account of any Issuing Bank
an amount in Dollars and in immediately available funds equal to its Pro Rata
Share of the amount of the drawing or of the Reducing L/C Borrowing, as the case
may be, whereupon the participating Banks shall (subject to Subsection 3.03(e))
each be deemed to have made a Revolving Loan to the Borrower
39
in that amount. If any Bank so notified fails to make available to the
Administrative Agent for the account of such Issuing Bank the amount of such
Bank's Pro Rata Share of the amount of the drawing or of the Reducing L/C
Borrowing, as the case may be, by no later than 3:00 p.m. (New York City time)
on the Business Day following the Honor Date, then interest shall accrue on such
Bank's obligation to make such payment, from the Honor Date to the date such
Bank makes such payment, at a rate per annum equal to the Federal Funds Rate in
effect from time to time during such period. The Administrative Agent will
promptly give notice of the occurrence of the Honor Date, but failure of the
Administrative Agent to give any such notice on the Honor Date or in sufficient
time to enable any Bank to effect such payment on such date shall not relieve
such Bank from its obligations under this Section 3.03.
(e) With respect to any unreimbursed drawing or Reducing L/C
Borrowing, as the case may be, that is not converted into Revolving Loans in
whole or in part for any reason, the Borrower shall be deemed to have incurred
from the relevant Issuing Bank an L/C Borrowing in the amount of such drawing or
Reducing L/C Borrowing, as the case may be, which L/C Borrowing shall be due and
payable on demand (together with interest) and shall bear interest at a rate per
annum equal to the Default Rate, and each Bank's payment to such Issuing Bank
pursuant to Subsection 3.03(d) shall be deemed payment in respect of its
participation in such L/C Borrowing and shall constitute an L/C Advance from
such Bank in satisfaction of its participation obligation under this Section
3.03.
(f) In the event that payment under any Letter of Credit Issued by an
Issuing Bank is drawn or purported to be drawn in a currency other than United
States Dollars, the amount of reimbursement to such Issuing Bank therefor shall
be calculated on the basis of such Issuing Bank's selling rate of exchange in
effect (for the date on which such Issuing Bank pays such draft or reimburses
any of its correspondents which paid such draft) for cable transfers to the
place where and in the currency in which such draft is payable. The Borrower
shall comply with any and all governmental exchange regulations now or hereafter
applicable to any foreign exchange, and shall indemnify and hold the Banks
harmless from any failure of the Borrower so to comply. If for any cause
whatsoever, there exists at the time in question no rate of exchange generally
current at such Issuing Bank for effective cable transfer of the sort above
provided for, the Borrower agrees to pay the Banks on demand an amount in United
States Dollars equivalent to the actual cost of settlement of such Issuing
Bank's obligation to the payor of the draft or acceptance or any holder thereof,
as the case may be, and however and whenever such settlement may be made by such
Issuing Bank.
(g) Each Bank's obligation in accordance with this Agreement to make
the Revolving Loans or L/C Advances, as contemplated by this Section 3.03, as a
result of a drawing under a Letter of Credit or Reducing L/C Borrowing, shall be
absolute and unconditional and without recourse to the relevant Issuing Bank and
shall not be affected by any circumstance, including (i) any set-off,
counterclaim, recoupment, defense or other right which such Bank may have
against such Issuing Bank, the Borrower or any other Person for any reason
whatsoever; (ii) the occurrence or continuance of a Default, an Event of Default
or a Material Adverse Effect; or (iii) any other circumstance, happening or
event whatsoever, whether or not similar to any of the foregoing.
40
(h) Notwithstanding the foregoing, each Revolving Loan and L/C
Advance made to fund payment of any Letter of Credit which was Issued or amended
on or after the Conversion to Reduced Funding Banks Date shall be made only by
the Approving Banks.
3.04 Repayment of Participations.
(a) Upon (and only upon) receipt by the Administrative Agent for the
account of an Issuing Bank of immediately available funds from the Borrower (i)
in reimbursement of any payment made by such Issuing Bank under a Letter of
Credit or in connection with a Reducing L/C Borrowing with respect to which any
Bank has paid the Administrative Agent for the account of such Issuing Bank for
such Bank's participation in the Letter of Credit pursuant to Section 3.03 or
(ii) in payment of interest thereon, the Administrative Agent will pay to each
Bank, in the same funds as those received by the Administrative Agent for the
account of such Issuing Bank, the amount of such Bank's Pro Rata Share of such
funds, and such Issuing Bank shall receive the amount of the Pro Rata Share of
such funds of any Bank that did not so pay the Administrative Agent for the
account of such Issuing Bank.
(b) If the Administrative Agent or an Issuing Bank is required at any
time to return to the Borrower, or to a trustee, receiver, liquidator,
custodian, or any official in any Insolvency Proceeding, any portion of the
payments made by the Borrower to the Administrative Agent for the account of
such Issuing Bank pursuant to Subsection 3.04(a) in reimbursement of a payment
made under a Letter of Credit or in connection with a Reducing L/C Borrowing or
interest or fee thereon, each Bank shall, on demand of such Issuing Bank,
forthwith return to the Administrative Agent or such Issuing Bank the amount of
its Pro Rata Share of any amounts so returned by the Administrative Agent or
such Issuing Bank plus interest thereon from the date such demand is made to the
date such amounts are returned by such Bank to the Administrative Agent or such
Issuing Bank, at a rate per annum equal to the Federal Funds Rate in effect from
time to time.
3.05 Role of the Issuing Banks.
(a) Each Bank and the Borrower agree that, in paying any drawing
under a Letter of Credit Issued by an Issuing Bank or funding any Reducing L/C
Borrowing, such Issuing Bank shall not have any responsibility to obtain any
document (other than any sight draft or certificates expressly required by such
Letter of Credit, but with respect to Reducing Letter of Credit Borrowings, no
document of any kind need be obtained) or to ascertain or inquire as to the
validity or accuracy of any such document or the authority of the Person
executing or delivering any such document.
(b) No Agent-Related Person nor any of the respective correspondents,
participants or assignees of any Issuing Bank shall be liable to any Bank for:
(i) any action taken or omitted in connection herewith at the request or with
the approval of the Banks; (ii) any action taken or omitted in the absence of
gross negligence or willful misconduct; or (iii) the due execution,
effectiveness, validity or enforceability of any L/C-Related Document.
41
(c) The Borrower hereby assumes all risks of the acts or omissions of
any beneficiary or transferee with respect to its use of any Letter of Credit;
provided, however, that this assumption is not intended to, and shall not,
preclude the Borrower pursuing such rights and remedies as it may have against
the beneficiary or transferee at law or under any other agreement. No
Agent-Related Person, nor any of the respective correspondents, participants or
assignees of any Issuing Bank shall be liable or responsible for any of the
matters described in clauses (a) through (g) of Section 3.06; provided, however,
that anything in such clauses or elsewhere herein to the contrary
notwithstanding, that the Borrower may have a claim against an Issuing Bank, and
such Issuing Bank may be liable to the Borrower, to the extent, but only to the
extent, of any direct, as opposed to consequential or exemplary, damages
suffered by the Borrower which the Borrower proves were caused by such Issuing
Bank's willful misconduct or gross negligence or such Issuing Bank's willful
failure to pay under any Letter of Credit after the presentation to it by the
beneficiary of a sight draft and certificate(s) strictly complying with the
terms and conditions of a Letter of Credit. In furtherance and not in limitation
of the foregoing: (i) the Issuing Banks may accept documents that appear on
their face to be in order, without responsibility for further investigation,
regardless of any notice or information to the contrary; and (ii) the Issuing
Banks shall not be responsible for the validity or sufficiency 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.
3.06 Obligations Absolute. The Obligations of the Borrower under this
Agreement and any L/C-Related Document to reimburse an Issuing Bank for a
drawing under a Letter of Credit or for a Reducing L/C Borrowing, and to repay
any L/C Borrowing and any drawing under a Letter of Credit or Reducing L/C
Borrowing converted into Revolving Loans, shall be unconditional and
irrevocable, and shall be paid strictly in accordance with the terms of this
Agreement and each such other L/C-Related Document under all circumstances,
including the following:
(a) any lack of validity or enforceability of this Agreement or any
L/C-Related Document;
(b) any change in the time, manner or place of payment of, or in any
other term of, all or any of the Obligations of the Borrower in respect of any
Letter of Credit or any other amendment or waiver of or any consent to departure
from all or any of the L/C-Related Documents;
(c) the existence of any claim, set-off, defense or other right that
the Borrower may have at any time against any beneficiary or any transferee of
any Letter of Credit (or any Person for whom any such beneficiary or any such
transferee may be acting), any Issuing Bank or any other Person, whether in
connection with this Agreement, the transactions contemplated hereby or by the
L/C-Related Documents or any unrelated transaction;
(d) any draft, demand, certificate or other document presented under
any Letter of Credit proving to be forged, fraudulent, invalid or insufficient
in any respect or any statement therein being untrue or inaccurate in any
respect; or any loss or delay in the transmission or otherwise of any document
required in order to make a drawing under any Letter of Credit;
42
(e) any payment by any Issuing Bank under any Letter of Credit
against presentation of a draft or certificate that does not strictly comply
with the terms of any Letter of Credit; or any payment made by any Issuing Bank
under any Letter of Credit to any Person purporting to be a trustee in
bankruptcy, debtor-in-possession, assignee for the benefit of creditors,
liquidator, receiver or other representative of or successor to any beneficiary
or any transferee of any Letter of Credit, including any arising in connection
with any Insolvency Proceeding;
(f) any exchange, release or non-perfection of any collateral, or any
release or amendment or waiver of or consent to departure from any other
guarantee, for all or any of the Obligations of the Borrower in respect of any
Letter of Credit; or
(g) any other circumstance or happening whatsoever, whether or not
similar to any of the foregoing, including any other circumstance that might
otherwise constitute a defense available to, or a discharge of, the Borrower.
Notwithstanding anything to the contrary in this Section 3.06 or in
the Continuing Agreement for Letters of Credit, the Issuing Banks shall not be
excused from liability to Borrower to the extent of any direct damages (as
opposed to consequential, indirect and punitive damages, claims in respect of
which are hereby waived by Borrower) suffered by Borrower that are caused by any
of the Issuing Bank's gross negligence or willful misconduct when determining
whether drafts and other documents presented under a Letter of Credit comply
with the terms thereof, provided, however, that the parties hereto expressly
agree that:
(i) the Issuing Banks may accept documents that appear on their
face to be in substantial compliance with the terms of a Letter of Credit
without responsibility for further investigation, regardless of any notice
or information to the contrary, and may make payment upon presentation of
documents that appear on their face to be in substantial compliance with
the terms of such Letter of Credit;
(ii) the Issuing Banks shall have the right, in their sole
discretion, to decline to accept documents and to make such payment if such
documents are not in strict compliance with the terms of such Letter of
Credit; and
(iii) this sentence shall establish the standard of care to be
exercised by the Banks when determining whether drafts and other documents
presented under a Letter of Credit comply with the terms thereof (and the
parties hereto hereby waive, to the extent permitted by applicable law, any
standard of care inconsistent with the foregoing).
3.07 Cash Collateral Pledge. Upon the request of the Administrative
Agent, (i) if an Issuing Bank has honored any full or partial drawing request on
any Letter of Credit and such drawing has resulted in an L/C Borrowing
hereunder, or (ii) if, as of the Expiration Date, any Letters of Credit may for
any reason remain outstanding and partially or wholly undrawn, the Borrower
shall immediately Cash Collateralize the L/C Obligations in an amount equal to
such L/C Obligations. Upon the occurrence of the circumstances described in
Section 2.06 requiring the Borrower to Cash Collateralize Letters of Credit,
then, the Borrower shall immediately Cash Collateralize the L/C Obligations in
an amount equal to the applicable excess.
43
3.08 Letter of Credit Fees.
(a) The Borrower shall pay to each Issuing Bank, for its own account,
such customary fees and charges in connection with the issuance, administration,
payment, negotiation and amendment of each Letter of Credit as the Borrower and
the Issuing Bank shall from time to time agree.
(b) The Borrower shall pay to the Administrative Agent for the
account of each of the Banks a letter of credit fee with respect to each of the
Letters of Credit Issued hereunder equal to the greater of (i) $700 or (ii)
1.50% per annum with respect to commercial documentary letters of credit and
standby letters of credit, or 2.00% per annum with respect to Swap-Related
Standby Letters of Credit, together with any related fees such as telecopy,
facsimile and courier fees, such letter of credit fees to be due and payable
monthly in arrears for the preceding month during which Letters of Credit are
outstanding, commencing on the first such monthly date to occur after the
Closing Date.
3.09 Applicability of Uniform Customs and Practice and ISP98. Unless
otherwise expressly agreed by an Issuing Bank and the Borrower when a Letter of
Credit is Issued (including any such agreement applicable to an Existing Letter
of Credit), the rules of the Uniform Customs and Practice for Documentary
Credits, as most recently published by the International Chamber of Commerce
(the "ICC") at the time of Issuance (including the ICC decision published by the
Commission on Banking Technique and Practice on April 6, 1998 regarding the
European single currency (euro)) shall apply to each standby Letter of Credit
and documentary Letter of Credit. If Borrower desires to use the rules of the
"International Standby Practices 1998" published by the Institute of
International Banking Law & Practice (or such later version thereof as may be in
effect at the time of Issuance) for standby Letters of Credit, Borrower shall
request and note this explicitly on the standby Letter of Credit application.
3.10 Existing Letters of Credit. Borrower hereby acknowledges and
agrees that the Existing Letters of Credit listed on Schedule 3.10 hereto shall
be deemed to be Letters of Credit Issued under this Agreement for all purposes.
ARTICLE IV
TAXES, YIELD PROTECTION AND ILLEGALITY
4.01 Taxes.
(a) Any and all payments by the Borrower to each Bank or either or
both of the Agents under this Agreement and any other Loan Document shall be
made free and clear of, and without deduction or withholding for, any Taxes. In
addition, the Borrower shall pay all Other Taxes.
(b) If the Borrower shall be required by law to deduct or withhold
any Taxes, Other Taxes or Further Taxes from or in respect of any sum payable
hereunder to any Bank or the Administrative Agent, then:
44
(i) the sum payable shall be increased as necessary so that
after making all required deductions and withholdings (including deductions
and withholdings applicable to additional sums payable under this Section)
such Bank or the Administrative Agent, as the case may be, receives and
retains an amount equal to the sum it would have received and retained had
no such deductions or withholdings been made;
(ii) the Borrower shall make such deductions and withholdings;
(iii) the Borrower shall pay the full amount deducted or withheld
to the relevant taxing authority or other authority in accordance with
applicable law; and
(iv) the Borrower shall also pay to each Bank or the
Administrative Agent for the account of such Bank, at the time interest is
paid, Further Taxes in the amount that Bank specifies as necessary to
preserve the after-tax yield the Bank would have received if such Taxes,
Other Taxes or Further Taxes had not been imposed.
(c) The Borrower agrees to indemnify and hold harmless each Bank and
the Administrative Agent for the full amount of (i) Taxes, (ii) Other Taxes, and
(iii) Further Taxes in the amount that the Administrative Agent or such Bank
specifies as necessary to preserve the after-tax yield the Administrative Agent
or such Bank would have received if such Taxes, Other Taxes or Further Taxes had
not been imposed, and any liability (including penalties, interest, additions to
tax and expenses) arising therefrom or with respect thereto, whether or not such
Taxes, Other Taxes or Further Taxes were correctly or legally asserted,
provided, however, that the Borrower shall not be required to indemnify or hold
harmless any Bank to the extent (but only to the extent) of such Bank's gross
negligence or willful misconduct. Payment under this indemnification shall be
made within 30 days after the date the Bank or the Administrative Agent makes
written demand therefor.
(d) Within 30 days after the date of any payment by the Borrower of
Taxes, Other Taxes or Further Taxes, the Borrower shall furnish the
Administrative Agent the original or a certified copy of a receipt evidencing
payment thereof, or other evidence of payment satisfactory to the Administrative
Agent.
(e) If the Borrower is required to pay any amount to the
Administrative Agent or any Bank pursuant to subsection (b) or (c) of this
Section, then such Bank shall use reasonable efforts (consistent with legal and
regulatory restrictions) to change the jurisdiction of its Lending Office so as
to eliminate any such additional payment by the Borrower which may thereafter
accrue, if such change in the judgment of such Bank is not otherwise
disadvantageous to such Bank.
4.02 Illegality.
(a) If any Bank determines that the introduction of any Requirement
of Law, or any change in any Requirement of Law, or in the interpretation or
administration of any Requirement of Law, has made it unlawful, or that any
central bank or other Governmental Authority has asserted that it is unlawful,
for such Bank or its applicable Lending Office to make Offshore Rate Loans,
then, on notice thereof by such Bank to the Borrower through the Administrative
Agent, any obligation of that Bank to make Offshore Rate Loans shall be
suspended until the Bank notifies the Administrative Agent and the Borrower that
the circumstances giving rise to such determination no longer exist.
45
(b) If a Bank determines that it is unlawful to maintain any Offshore
Rate Loan, the Borrower shall, upon receipt of notice of such fact and demand
from such Bank (with a copy to the Administrative Agent), prepay in full,
without premium or penalty, such Offshore Rate Loans of that Bank then
outstanding, together with interest accrued thereon either on the last day of
the Interest Period thereof, if the Bank may lawfully continue to maintain such
Offshore Rate Loans to such day, or immediately, if the Bank may not lawfully
continue to maintain such Offshore Rate Loan. If the Borrower is required to so
prepay any Offshore Rate Loan, then concurrently with such prepayment, the
Borrower shall borrow from the affected Bank, in the amount of such repayment, a
Base Rate Loan.
4.03 Increased Costs and Reduction of Return.
(a) If any Bank determines that, due to either (i) the introduction
of or any change (other than any change by way of imposition of or increase in
reserve requirements included in the calculation of the Offshore Rate or in
respect of the assessment rate payable by any Bank to the FDIC for insuring U.S.
deposits) in or in the interpretation of any law or regulation or (ii) the
compliance by that Bank with any guideline or request from any central bank or
other Governmental Authority (whether or not having the force of law), there
shall be any increase in the cost to such Bank of agreeing to make or making,
funding or maintaining any Offshore Rate Loans or participating in Letters of
Credit, or, in the case of an Issuing Bank, any increase in the cost to such
Issuing Bank of agreeing to issue, issuing or maintaining any Letter of Credit
or of agreeing to make or making, funding or maintaining any unpaid drawing
under any Letter of Credit, then the Borrower shall be liable for, and shall
from time to time, within 30 days of demand (with a copy of such demand to be
sent to the Administrative Agent), pay to the Administrative Agent for the
account of such Bank, additional amounts as are sufficient to compensate such
Bank for such increased costs, provided, however, that the Borrower shall not be
required to pay any such amount to the extent that such amount is reflected in
changes in the Base Rate, the Offshore Rate or other fees or charges of such
Bank.
(b) If any Bank shall have determined that (i) the introduction of
any Capital Adequacy Regulation, (ii) any change in any Capital Adequacy
Regulation, (iii) any change in the interpretation or administration of any
Capital Adequacy Regulation by any central bank or other Governmental Authority
charged with the interpretation or administration thereof, or (iv) compliance by
the Bank (or its Lending Office) or any corporation controlling the Bank with
any Capital Adequacy Regulation, affects or would affect the amount of capital
required or expected to be maintained by the Bank or any corporation controlling
the Bank and (taking into consideration such Bank's or such corporation's
policies with respect to capital adequacy and such Bank's desired return on
capital) determines that the amount of such capital is increased as a
consequence of its loans, credits or obligations under this Agreement, then,
within 30 days of demand of such Bank to the Borrower through the Administrative
Agent, the Borrower shall pay to the Bank, from time to time as specified by the
Bank, additional amounts sufficient to compensate the Bank for such increase,
provided, however, that the Borrower shall not be required to pay any such
amount to the extent that such amount is reflected in changes in the Base Rate.
46
4.04 Funding Losses. The Borrower shall reimburse each Bank and hold
each Bank harmless from any loss or expense which the Bank may sustain or incur
as a consequence of:
(a) the failure of the Borrower to make on a timely basis any payment
of principal of any Offshore Rate Loan;
(b) the failure of the Borrower to borrow, continue or convert a Loan
after the Borrower has given (or are deemed to have given) a Notice of Borrowing
or a Notice of Conversion/Continuation;
(c) the failure of the Borrower to make any prepayment in accordance
with any notice delivered under Section 2.06;
(d) the prepayment (including prepayments made pursuant to Article II
but excluding prepayments made pursuant to Section 4.02) or other payment
(including after acceleration thereof) of an Offshore Rate Loan on a day that is
not the last day of the relevant Interest Period; or
(e) the automatic conversion under Section 2.04 of any Offshore Rate
Loan to a Base Rate Loan on a day that is not the last day of the relevant
Interest Period except any such automatic conversion resulting from prepayments
required by Section 4.02;
including any such loss or expense arising from the liquidation or reemployment
of funds obtained by it to maintain its Offshore Rate Loans or from fees payable
to terminate the deposits from which such funds were obtained. For purposes of
calculating amounts payable by the Borrower to the Banks under this Section and
under Section 4.03, each Offshore Rate Loan made by a Bank (and each related
reserve, special deposit or similar requirement) shall be conclusively deemed to
have been funded at the LIBOR used in determining the Offshore Rate for such
Offshore Rate Loan by a matching deposit or other borrowing in the interbank
eurodollar market for a comparable amount and for a comparable period, whether
or not such Offshore Rate Loan is in fact so funded.
4.05 Inability to Determine Rates. If the Administrative Agent and the
Banks determine that for any reason adequate and reasonable means do not exist
for determining the Offshore Rate for any requested Interest Period with respect
to a proposed Offshore Rate Loan, or that the Offshore Rate applicable pursuant
to Subsection 2.08(a) for any requested Interest Period with respect to a
proposed Offshore Rate Loan does not adequately and fairly reflect the cost to
the Banks of funding such Loan, the Administrative Agent will promptly so notify
the Borrower and each Bank. Thereafter, the obligation of the Banks to make or
maintain Offshore Rate Loans, as the case may be, hereunder shall be suspended
until the Administrative Agent upon the instruction of the Banks revokes such
notice in writing. Upon receipt of such notice, the Borrower may revoke any
Notice of Borrowing or Notice of Conversion/Continuation then submitted by it.
If the Borrower does not revoke such Notice, the Banks shall make, convert or
continue the Loans, as proposed by the Borrower, in the amount specified in the
applicable notice submitted by the Borrower, but such Loans shall be made,
converted or continued as Base Rate Loans instead of Offshore Rate Loans.
47
4.06 Reserves on Offshore Rate Loans. The Borrower shall pay to each
Bank, as long as such Bank shall be required under regulations of the FRB to
maintain reserves with respect to liabilities or assets consisting of or
including Eurocurrency funds or deposits (currently known as "Eurocurrency
liabilities"), additional costs on the unpaid principal amount of each Offshore
Rate Loan equal to the actual costs of such reserves allocated to such Loan by
the Bank (as determined by the Bank in good faith, which determination shall be
conclusive), payable on each date on which interest is payable on such Loan,
provided, however, that the Borrower shall have received at least 15 days' prior
written notice (with a copy to the Administrative Agent) of such additional
interest from the Bank. If a Bank fails to give notice 15 days prior to the
relevant Interest Payment Date, such additional interest shall be payable 15
days from receipt of such notice.
4.07 Certificates of Banks. Together with any demand by a Bank for
reimbursement or compensation pursuant to this Article IV, such Bank shall
provide to the Borrower (with a copy to the Administrative Agent) a certificate
signed by an authorized officer of the Bank (a) describing the event giving rise
to such demand, and (b) showing the method and detailed calculations (which may
include any reasonable averaging, attribution or allocation procedures) used by
the Bank to determine the amount demanded by the Bank. In calculating the amount
of costs, expenses, capital requirements or rate of reduction allocable to the
Borrower, such Bank shall use such reasonable methods as such Bank shall
determine. Such calculation and certification shall be conclusive and binding on
the Borrower in the absence of manifest error.
4.08 Substitution of Banks. Upon the receipt by the Borrower from any
Bank (an "Affected Bank") of a claim for compensation under Section 4.03, the
Borrower may: (a) request the Affected Bank to use its best efforts to obtain a
replacement bank or financial institution satisfactory to the Borrower to
acquire and assume all or a ratable part of all of such Affected Bank's Loans
and Uncommitted Line Portion (a "Replacement Bank"); (b) request one or more of
the other Banks to acquire and assume all or part of such Affected Bank's Loans
and Uncommitted Line Portion; or (c) designate a Replacement Bank. Any such
designation of a Replacement Bank under clause (a) or (c) shall be subject to
the prior written consent of Agents (which consent shall not be unreasonably
withheld).
4.09 Survival. The agreements and Obligations of the Borrower in this
Article IV shall survive the payment of all other Obligations.
ARTICLE V
CLOSING ITEMS
5.01 Matters to be Satisfied Upon Execution of Agreement. At
the time the Banks execute this Agreement, unless otherwise waived by the Banks,
the Documentation Agent shall have received all of the following, in form and
substance satisfactory to the Documentation Agent, the Administrative Agent, and
each Bank, and in sufficient copies for each Bank:
(a) Loan Documents. This Agreement, the Notes, the Guaranty, a
Reaffirmation Agreement reaffirming the Security Agreements, the Atmos Support
Agreement, the Tri-party
48
Agreement among Borrower, the Administrative Agent and each Eligible Broker, the
Continuing Agreement for Letters of Credit and certain other documents executed
in connection with the Original Credit Agreement, and each other document or
certificate executed in connection with this Agreement, executed by each party
thereto;
(b) Subordination Agreement. A Subordination Agreement, duly executed
and delivered by Atmos Energy Holdings, Inc., in a form substantially similar to
Exhibit G;
(c) Payment of Existing Subordinated Indebtedness. Evidence of the
repayment in full by the Borrower of all amounts owed to Atmos Energy Marketing,
LLC for Indebtedness incurred, as subordinated pursuant to that certain
Subordination Agreement dated as of December 1, 2001 among the Borrower, Atmos
Energy Marketing, LLC, and the Administrative Agent.
(d) Resolutions; Incumbency. Copies of the resolutions of the members
of the Borrower authorizing the transactions contemplated hereby, certified as
of the Closing Date by the Secretary of the Borrower, and certifying the names
and true signatures of the officers of the Borrower authorized to execute,
deliver and perform, as applicable, this Agreement, and all other Loan Documents
to be delivered by the Borrower hereunder;
(e) Organization Documents; Existence; Good Standing. The articles or
certificate of formation and the regulations of the Borrower as in effect on the
Closing Date, all certified by the Secretary of the Borrower as of the Closing
Date, and the articles or certificate of formation and the Bylaws or regulations
of Atmos Energy Corporation and Atmos Energy Holdings, Inc. as in effect on the
Closing Date, all certified by the Secretary of Atmos Energy Corporation and
Guarantors as of the Closing Date together with certificates of existence and
good standing for the Borrower, Atmos Energy Corporation and Guarantors from the
Secretary of State (or similar, applicable Governmental Authority) of its state
of incorporation and each state where the general partner of the Borrower is
qualified to do business as a foreign corporation, certified as of, or
reasonably close to, the Closing Date;
(f) Legal Opinions. Legal opinion of counsel to the Borrower and
counsel to Guarantors each addressed to the Administrative Agent and the Banks,
in form and substance acceptable to the Administrative Agent and the Banks;
(g) Payment of Fees. Evidence of payment by the Borrower of all
accrued and unpaid fees, costs and expenses to the extent then due and payable
on the Closing Date, together with Attorney Costs of Agents to the extent
invoiced prior to or on the Closing Date, plus such additional amounts of
Attorney Costs as shall constitute the Agents' reasonable estimate of Attorney
Costs incurred or to be incurred by them through the closing proceedings
(provided, however, that such estimate shall not thereafter preclude final
settling of accounts between the Borrower and Agents); including any such costs,
fees and expenses arising under or referenced in Sections 2.09 and 11.04(a) and
all costs of the auditors and consultants retained by the Banks in connection
with the Obligations of the Borrower to Agents;
(h) Certificate. A certificate signed by a Responsible Officer of the
Borrower, dated as of the Closing Date, stating to the best of such officer's
knowledge that:
49
(i) The representations and warranties contained in Article VI
are true and correct on and as of such date, as though made on and as of
such date; and
(ii) No Default or Event of Default exists or would result from
the Credit Extension.
(iii) There has occurred since April 30, 2002, no event or
circumstance that has resulted or could reasonably be expected to result in
a Material Adverse Effect;
(i) Insurance. Evidence of insurance required to be maintained by the
Borrower hereunder;
(j) Filings. Evidence that all filings needed to perfect the security
interests granted by the Security Agreements have been completed or due
provision has been made therefor;
(k) Service of Process Form. An acknowledgement letter from
Corporation Service Company as contemplated by Subsection 11.16(b); and
(l) Other Documents. Such other approvals, opinions, documents or
materials as the Agents or any Bank may request.
ARTICLE VI
REPRESENTATIONS AND WARRANTIES
The Borrower represents and warrants to the Agents and each Bank that:
6.01 Existence and Power. Each of the Borrower, its Subsidiaries and
Guarantors:
(a) is a limited liability company or corporation, as the case may
be, duly organized, validly existing and in good standing under the laws of the
jurisdiction of its organization;
(b) has the power and authority and all governmental licenses,
authorizations, consents and approvals to own its assets, carry on their
business and to execute, deliver, and perform their respective Obligations under
the Loan Documents;
(c) is duly qualified as a foreign limited liability company or
corporation, as the case may be, and is licensed and in good standing under the
laws of each jurisdiction where its ownership, lease or operation of property or
the conduct of its business requires such qualification or license; and to the
best knowledge of such Person, is in compliance with all Requirements of Law.
6.02 Authorization; No Contravention. The execution, delivery and
performance by the Borrower and Guarantors of each Loan Document to which such
Person is party, have been duly authorized, and do not and will not:
50
(a) contravene the terms of the Organization Documents of such
Person;
(b) conflict with or result in any breach or contravention of,
or the creation of any Lien under, any document evidencing any Contractual
Obligation to which such Person is a party or any order, injunction, writ or
decree of any Governmental Authority to which such Person or its property is
subject; or
(c) to the best knowledge of the Borrower, violate any
Requirement of Law.
6.03 Governmental Authorization. No approval, consent,
exemption, authorization, or other action by, or notice to, or filing with, any
Governmental Authority is necessary or required in connection with the
execution, delivery or performance by, or enforcement against, the Borrower or
any of its Subsidiaries or Guarantors, as applicable, of any Loan Document.
6.04 Binding Effect. This Agreement and each other Loan
Document to which the Borrower or any of its Subsidiaries or Guarantors is a
party constitute the legal, valid and binding obligations of such Person to the
extent it is a party thereto, enforceable against such Person in accordance with
their respective terms, except as enforceability may be limited by applicable
bankruptcy, insolvency, or similar laws affecting the enforcement of creditors'
rights generally or by general principles of equity.
6.05 Litigation. Except as specifically disclosed in Schedule
6.05, there are no actions, suits or proceedings, pending, or to the knowledge
of the Borrower, or Guarantors threatened at law, in equity, in arbitration or
before any Governmental Authority, against the Borrower, or any of its
Subsidiaries or Guarantors or any of their respective properties which purport
to affect or pertain to this Agreement or any other Loan Document, or any of the
transactions contemplated hereby or thereby; and no injunction, writ, temporary
restraining order or any order of any nature has been issued by any court or
other Governmental Authority purporting to enjoin or restrain the execution,
delivery or performance of this Agreement or any other Loan Document, or
directing that the transactions provided for herein or therein not be
consummated as herein or therein provided.
6.06 No Default. No Default or Event of Default exists or would
result from the incurring of any Obligations by the Borrower. As of the Closing
Date, neither the Borrower nor any of its Subsidiaries are in default under or
with respect to any Contractual Obligation in any respect which, individually or
together with all such defaults, could reasonably be expected to have a Material
Adverse Effect.
6.07 ERISA Compliance. Except as specifically disclosed in
Schedule 6.07:
(a) Each Plan is in compliance in all material respects with the
applicable provisions of ERISA, the Code and other federal or state law. Each
Plan which is intended to qualify under Section 401(a) of the Code has received
a favorable determination letter from the IRS and to the best knowledge of the
Borrower, nothing has occurred which would cause the loss of such qualification.
The Borrower and each ERISA Affiliate have made all required contributions to
any Plan subject to Section 412 of the Code, and no application for a funding
waiver or an extension of any amortization period pursuant to Section 412 of the
Code has been made with respect to any Plan.
51
(b) There are no pending or, to the best knowledge of the
Borrower, threatened claims, actions or lawsuits, or action by any Governmental
Authority, with respect to any Plan which have resulted or could reasonably be
expected to result in a Material Adverse Effect. There has been no prohibited
transaction or violation of the fiduciary responsibility rules with respect to
any Plan which has resulted or could reasonably be expected to result in a
Material Adverse Effect.
(c) (i) To the Borrower's best knowledge, no ERISA Event has
occurred or is reasonably expected to occur; (ii) no Pension Plan has any
Unfunded Pension Liability; (iii) neither the Borrower nor any ERISA Affiliate
has incurred, or reasonably expects to incur, any liability under Title IV of
ERISA with respect to any Pension Plan (other than premiums due and not
delinquent under Section 4007 of ERISA); (iv) neither the Borrower nor any ERISA
Affiliate has incurred, or reasonably expects to incur, any liability (and no
event has occurred which, with the giving of notice under Section 4219 of ERISA,
would result in such liability) under Section 4201 or 4243 of ERISA with respect
to a Multiemployer Plan; and (v) neither the Borrower nor any ERISA Affiliate
has engaged in a transaction that could be subject to Section 4069 or 4212(c) or
ERISA.
6.08 Use of Proceeds; Margin Regulations. The proceeds of the
Loans are to be used solely for the purposes set forth in and permitted by
Section 7.12. Neither the Borrower nor any Subsidiary is generally engaged in
the business of purchasing or selling Margin Stock or extending credit for the
purpose of purchasing or carrying Margin Stock.
6.09 Title to Properties. The Borrower and each of its
Subsidiaries have good record and marketable title in fee simple to, or valid
leasehold interests in, all real property necessary or used in the ordinary
conduct of their respective businesses, except for such defects in title as
could not, individually or in the aggregate, have a Material Adverse Effect. As
of the Closing Date, the property of the Borrower and its Subsidiaries is
subject to no Liens, other than Permitted Liens.
6.10 Taxes. The Borrower and its Subsidiaries have filed all
Federal and other material tax returns and reports required to be filed, and
have paid all Federal and other material taxes, assessments, fees and other
governmental charges shown thereon to be due and payable, and have paid all
material taxes, assessments, fees and other governmental charges levied or
imposed upon them or their properties, income or assets as due and payable,
except those which are being contested in good faith by appropriate proceedings
and for which adequate reserves have been provided in accordance with GAAP.
There is no proposed tax assessment against the Borrower or any of its
Subsidiaries that would, if made, have a Material Adverse Effect.
6.11 Financial Condition.
(a) The unaudited balance sheet of the Borrower dated as of
April 30, 2002:
(i) fairly presents the financial condition of the Borrower as
of the date thereof; and
52
(ii) shows all material indebtedness and other liabilities,
direct or contingent, of the Borrower and as of the date thereof,
including liabilities for taxes, material commitments and Contingent
Obligations.
(b) Since April 30, 2002, there has been no Material Adverse
Effect.
6.12 Environmental Matters. The Borrower conducts in the
ordinary course of business a review of the effect of existing Environmental
Laws and existing Environmental Claims on its business, operations and
properties, and as a result thereof the Borrower has reasonably concluded that,
except as previously specifically disclosed in Schedule 6.12, such Environmental
Laws and Environmental Claims could not, individually or in the aggregate,
reasonably be expected to have a Material Adverse Effect.
6.13 Regulated Entities. Neither the Borrower, nor any Person
controlling the Borrower, or any of its Subsidiaries, is an "Investment Company"
within the meaning of the Investment Company Act of 1940. The Borrower is not
subject to regulation under the Public Utility Holding Company Act of 1935, the
Federal Power Act, the Interstate Commerce Act, any state public utilities code,
or any other Federal or state statute or regulation limiting its ability to
incur Indebtedness.
6.14 No Burdensome Restrictions. Neither the Borrower nor any
of its Subsidiaries is a party to or bound by any Contractual Obligation, or
subject to any restriction in any Organization Document, or any Requirement of
Law, which could reasonably be expected to have a Material Adverse Effect.
6.15 Copyrights, Patents, Trademarks and Licenses, Etc. To the
Borrower's best knowledge, the Borrower or its Subsidiaries own or are licensed
or otherwise have the right to use all of the patents, trademarks, service
marks, trade names, copyrights, contractual franchises, authorizations and other
rights that are reasonably necessary for the operation of their respective
businesses, without conflict with the rights of any other Person. To the
knowledge of the Borrower, no slogan or other advertising device, product,
process, method, substance, part or other material now employed, or now
contemplated to be employed, by the Borrower or any Subsidiary infringes upon
any rights held by any other Person. Except as specifically disclosed in
Schedule 6.05, no claim or litigation regarding any of the foregoing is pending
or threatened, and no patent, invention, device, application, principle or any
statute, law, rule, regulation, standard or code is pending or, to the knowledge
of the Borrower, proposed.
6.16 Subsidiaries. The Borrower has no Subsidiaries other than
those specifically disclosed in part (a) of Schedule 6.16 hereto and have no
equity investments in any other corporation or entity other than those
specifically disclosed in part (b) of Schedule 6.16.
6.17 Insurance. Except as specifically disclosed in Schedule
6.17, the properties of the Borrower and its Subsidiaries are insured with
financially sound and reputable insurance companies not Affiliates of the
Borrower, in such amounts, with such deductibles and covering such risks as are
customarily carried by companies engaged in similar businesses and owning
similar properties in localities where the Borrower or such Subsidiary operates.
53
6.18 Full Disclosure. To the Borrower's best knowledge, none of
the representations or warranties made by the Borrower or any of its
Subsidiaries in the Loan Documents as of the date such representations and
warranties are made or deemed made, and none of the statements contained in any
exhibit, report, statement or certificate furnished by or on behalf of the
Borrower or any of its Subsidiaries in connection with the Loan Documents
(including the offering and disclosure materials delivered by or on behalf of
the Borrower to the Banks prior to the Closing Date), contains any untrue
statement of a material fact or omits any material fact required to be stated
therein or necessary to make the statements made therein, in light of the
circumstances under which they are made, not misleading as of the time when made
or delivered.
ARTICLE VII
AFFIRMATIVE COVENANTS
So long as any Bank shall be continuing to consider making
Revolving Loans or Issuing Letters of Credit hereunder, or any Loan or other
Obligation shall remain unpaid or unsatisfied, or any Letter of Credit shall
remain outstanding:
7.01 Financial Statements. The Borrower shall deliver to the
Banks, in form and detail satisfactory to the Banks:
(a) as soon as available, but not later than 120 days after
the end of each fiscal year, (i) a copy of the consolidated audited financial
statements to include a balance sheet as at the end of such year for each of (A)
Atmos Energy Corporation, (B) the Atmos Energy Holdings, Inc., and (C) the
Borrower, and (ii) a copy of the consolidating unaudited financial statements to
include a consolidating balance sheet as at the end of such year for Atmos
Energy Holdings, Inc. and the Borrower, and (iii) a copy of the consolidated
audited financial statements of the Borrower and its Subsidiaries, and the
related statements of income or operations, members' capital and cash flows for
such year for such entities, setting forth in each case in comparative form the
figures for the previous fiscal year, and accompanied by the opinion of a
nationally-recognized independent public accounting firm ("Independent Auditor")
which report shall state that such financial statements present fairly the
financial position for the periods indicated in conformity with GAAP applied on
a basis consistent with prior years. Such opinion shall not be qualified or
limited because of a restricted or limited examination by the Independent
Auditor of any material portion of the records of such entities;
(b) as soon as available, but not later than 60 days after the
end of each of the first three fiscal quarters of each fiscal year of Atmos
Energy Holdings, Inc. and Atmos Energy Corporation, (i) the unaudited
consolidated financial statements of Atmos Energy Corporation and Atmos Energy
Holdings, Inc., each to include a balance sheet as at the end of such fiscal
quarter, with the related statements of income and or operations, members'
capital and cash flows for such year for such entities, for the period
commencing at the end of the previous fiscal quarter and ending with the end of
such fiscal quarter and for the period commencing at the end of the previous
fiscal year and ending with the end of such fiscal quarter, setting forth in
comparative form, in the case of each such consolidated balance sheet, the
corresponding figures as of the last day of the corresponding period in the
immediately preceding fiscal year and, in the case
54
of each such consolidated statement of income and operations, members' capital
and cash flows, the corresponding figures for the corresponding period in the
immediately preceding fiscal year, and (ii) the unaudited consolidating
financial statement of Atmos Energy Holdings, Inc.; and
(c) as soon as available, but not later than 45 days after the
end of each month, the consolidated financial statements of the Borrower and its
subsidiaries in form acceptable to Banks.
7.02 Certificates; Other Information. The Borrower shall
furnish to the Agents and the Banks:
(a) concurrently with the delivery of the financial statements
referred to in Subsections 7.01(a), (b), and (c), a Compliance Certificate
executed by a Responsible Officer of the Borrower;
(b) a Borrowing Base Collateral Position Report executed by a
Responsible Officer of the Borrower as of 15th day of each month and as of the
last Business Day of each month, in each case delivered within ten (10) days of
such reporting date;
(c) on or before the tenth (10th) day of each month, a Net
Position Report as of the first (1st) day of said month, and on or before the
twenty-fifth (25th) day of each month, a Net Position Report as of the fifteenth
(15th) day of such month, in each case certified by a Responsible Officer of the
Borrower;
(d) promptly when available, such additional information
regarding the business, financial or corporate affairs of the Borrower or any
Subsidiary as the Agents, at the request of any Bank, may from time to time
reasonably request; and
(e) a quarterly report of inventory storage locations at each
quarter end.
7.03 Notices. The Borrower shall promptly notify the Agents
and each Bank:
(a) of the occurrence of any Default or Event of Default, and
of the occurrence or existence of any event or circumstance that could
reasonably be expected to become a Default or Event of Default;
(b) of the occurrence of any event which could reasonably be
expected to cause a material impairment of the Collateral Position;
(c) of the occurrence of any event which could reasonably be
expected to cause a Material Adverse Effect, including (i) breach or
non-performance of, or any default under, a material Contractual Obligation of
the Borrower or any Subsidiary; (ii) any material dispute, litigation,
investigation, proceeding or suspension between the Borrower or any Subsidiary
and any Governmental Authority; or (iii) the commencement of, or any material
development in, any litigation or proceeding affecting the Borrower or any
Subsidiary, including pursuant to any applicable Environmental Laws;
55
(d) of the occurrence of any of the following events affecting
the Borrower or any ERISA Affiliate (but in no event more than 10 days after the
Borrower receives notice or becomes aware of such event), and deliver to the
Agents and each Bank a copy of any notice with respect to such event that is
filed with a Governmental Authority and any notice delivered by a Governmental
Authority to the Borrower or any ERISA Affiliate with respect to such event:
(i) an ERISA Event;
(ii) a material increase in the Unfunded Pension Liability of
any Pension Plan;
(iii) the adoption of, or the commencement of contributions
to, any Plan subject to Section 412 of the Code by the Borrower or any
ERISA Affiliate; or
(iv) the adoption of any amendment to a Plan subject to
Section 412 of the Code, if such amendment results in a material
increase in contributions or Unfunded Pension Liability;
(e) of any material change in accounting policies or financial
reporting practices by the Borrower; and
(f) of any intended relocation of inventory or any intended
new location of inventory owned by the Borrower, at least ten (10) Business Days
prior to the date such inventory is to be stored at such location.
Each notice under this Section shall be accompanied by a
written statement by a Responsible Officer of the Borrower setting forth details
of the occurrence referred to therein, and stating what action the Borrower or
any affected Subsidiary proposes to take with respect thereto and at what time.
Each notice under Subsection 7.03(a) shall describe with particularity any and
all clauses or provisions of this Agreement or other Loan Document that have
been (or reasonably could be expected to be) breached or violated as therein
provided.
7.04 Preservation of Corporate Existence, Etc. The Borrower
shall, and shall cause each of its Subsidiaries to:
(a) preserve and maintain in full force and effect its
existence and good standing under the laws of its state or jurisdiction of
organization;
(b) preserve and maintain in full force and effect all
governmental rights, privileges, qualifications, permits, licenses and
franchises necessary or desirable in the normal conduct of its business;
(c) use reasonable efforts, in the ordinary course of
business, to preserve its business organization and goodwill; and
(d) preserve or renew all of its registered patents,
trademarks, trade names and service marks, the non-preservation of which could
reasonably be expected to have a Material Adverse Effect.
56
7.05 Maintenance of Property. The Borrower shall maintain, and
shall cause each of its Subsidiaries to maintain, and preserve all its property
which is used or useful in its business in good working order and condition,
ordinary wear and tear excepted and make all necessary repairs thereto and
renewals and replacements thereof except in any case where the failure to do so
could not reasonably be expected to have a Material Adverse Effect.
7.06 Insurance. The Borrower shall maintain, and shall cause
each of its Subsidiaries to maintain, with financially sound and reputable
independent insurers, insurance with respect to its properties and business
against loss or damage of the kinds customarily insured against by Persons
engaged in the same or similar business, of such types and in such amounts as
are customarily carried under similar circumstances by such other Persons,
including, without limitation, marine cargo insurance, if appropriate.
7.07 Payment of Obligations. The Borrower shall, and shall
cause each of its Subsidiaries to, pay and discharge as the same shall become
due and payable, all their respective obligations and liabilities, including:
(a) all tax liabilities, assessments and governmental charges
or levies upon it or its properties or assets, unless the same are being
contested in good faith by appropriate proceedings and adequate reserves in
accordance with GAAP are being maintained by the Borrower or such Subsidiary;
(b) all lawful claims which, if unpaid, would by law become a
Lien upon its property unless the same are being contested in good faith by
appropriate proceedings and adequate reserves in accordance with GAAP are being
maintained by the Borrower or Subsidiary, and provided that at such time the
claim becomes a Lien (other than a lis pendens notice), it shall be promptly
paid; and
(c) all indebtedness, as and when due and payable, but subject
to any subordination provisions contained in any instrument or agreement
evidencing such Indebtedness.
7.08 Compliance with Laws. The Borrower shall comply, and shall
cause each of its Subsidiaries to comply, with all Requirements of Law of any
Governmental Authority having jurisdiction over it or its business (including
the Federal Fair Labor Standards Act).
7.09 Compliance with ERISA. The Borrower shall, and shall cause
each of its ERISA Affiliates to: (a) maintain each Plan in compliance with the
applicable provisions of ERISA, the Code and other federal or state law; (b)
cause each Plan which is qualified under Section 401(a) of the Code to maintain
such qualification; and (c) make all required contributions to any Plan subject
to Section 412 of the Code.
7.10 Inspection of Property and Books and Records. The Borrower
shall maintain and shall cause each of its Subsidiaries to maintain proper books
of record and account, in which full, true and correct entries in conformity
with GAAP consistently applied shall be made of all financial transactions and
matters involving the assets and business of the Borrower and such Subsidiary.
The Borrower shall permit, and shall cause each of its Subsidiaries to permit
representatives and independent contractors of either of the Agents or any Bank
to visit
57
and inspect any of their respective properties, to examine their respective
corporate, financial and operating records, and make copies thereof or abstracts
therefrom, and to discuss their respective affairs, finances and accounts with
their respective directors, officers, and independent public accountants, all at
the expense of the Agent or Bank causing such inspection and at such reasonable
times during normal business hours and as often as may be reasonably desired,
upon reasonable advance notice to the Borrower; provided, however, that when an
Event of Default exists either of the Agents or any Bank may do any of the
foregoing at the expense of the Borrower at any time during normal business
hours and without advance notice.
7.11 Environmental Laws. The Borrower shall, and shall cause
each of its Subsidiaries to, conduct its operations and keep and maintain its
property in compliance in all material respects with all Environmental Laws.
7.12 Use of Proceeds. The Borrower shall use the proceeds of
the Loans for the uses described in this Agreement and not in contravention of
any Requirement of Law or of any Loan Document restrictions on use of loan
proceeds.
The Borrower shall not use the proceeds of the Loan or any
Letter of Credit to acquire, directly or indirectly, any Margin Stock.
7.13 Collateral Position Audit. At such times as Agents deem
advisable, the Borrower will allow Agents or an entity satisfactory to Agents to
conduct a thorough examination of the Collateral, and the Borrower will fully
cooperate in such examination. The Borrower will pay the costs and expenses of
one such examination each calendar year.
7.14 Lock Box. The Borrower shall (i) maintain a lock box with
Bank of America, N.A. (the "Lock Box") and shall notify in writing and otherwise
take such reasonable steps to ensure that all Account Debtors under any of its
Accounts forward payment in the form of cash, checks, drafts or other similar
items of payment directly to such Lock Box and shall provide Banks with
reasonable evidence of such notification, and (ii) deposit and cause its
Subsidiaries to deposit or cause to be deposited all payments under such
Accounts to the Lock Box. In the event that any Account Debtor does make any
payment directly to the Borrower, the Borrower shall promptly deposit such
amounts into the Lock Box. The Borrower and each Bank acknowledge and agree that
prior to the Activation Period, the Borrower may operate and transact business
through the Lock Box account in its normal fashion, including making withdrawals
from the Lock Box account. The Borrower and each Bank further acknowledge and
agree that during the Activation Period, Bank of America, N.A. shall transfer
all collected and available balances in the Lock Box to the Bank Blocked Account
pursuant to the Three Party Agreement. The Borrower and each Bank acknowledge
and agree that the Bank Blocked Account is owned by the Collateral Agent for the
benefit of the Agents, the Issuing Banks and the Banks and the Lock Box is under
the dominion and control of the Collateral Agent. The Collateral Agent at any
time may apply amounts contained in the Bank Blocked Account toward satisfaction
of the Obligations.
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7.15 Financial Covenants. The Borrower will, at all times,
observe the following financial covenants:
(a) minimum Net Working Capital as follows:
(i) $20,000,000.00 at such time as the elected Borrowing Base
Sub-Cap is $100,000,000.00 or less;
(ii) $25,000,000.00 at such time as the elected Borrowing Base
Sub-Cap is $125,000,000.00 or less but greater than $100,000,000.00;
(iii) $30,000,000.00 at such time as the elected Borrowing
Base Sup-Cap is $150,000,000.00 or less but greater than $125,000,000.00;
(iv) $35,000,000.00 at such time as the elected Borrowing Base
Sub-Cap is $175,000,000.00 or less but greater than $150,000,000.00;
(v) $40,000,000.00 at such time as the elected Borrowing Base
Sub-Cap is $200,000,000.00 or less but greater than $175,000,000.00;
(vi) $45,000,000.00 at such time as the elected Borrowing Base
Sub-Cap is $225,000,000.00 or less but greater than $200,000,000.00; and
(vii) $50,000,000.00 at such time as the elected Borrowing
Base Sub-Cap is $250,000,000.00 or less but greater than $225,000,000.00.
(b) minimum Tangible Net Worth as follows:
(i) $21,000,000.00 at such time as the elected Borrowing Base
Sub-Cap is $100,000,000.00 or less;
(ii) $26,000,000.00 at such time as the elected Borrowing Base
Sub-Cap is $125,000,000.00 or less but greater than $100,000,000.00;
(iii) $31,000,000.00 at such time as the elected Borrowing
Base Sub-Cap is $150,000,000.00 or less but greater than $125,000,000.00;
(iv) $36,000,000.00 at such time as the elected Borrowing Base
Sub-Cap is $175,000,000.00 or less but greater than $150,000,000.00;
(v) $41,000,000.00 at such time as the elected Borrowing Base
Sub-Cap is $200,000,000.00 or less but greater than $175,000,000.00;
(vi) $46,000,000.00 at such time as the elected Borrowing Base
Sub-Cap is $225,000,000.00 or less but greater than $200,000,000.00; and
(vii) $51,000,000.00 at such time as the elected Borrowing
Base Sub-Cap is $250,000,000.00 or less but greater than $225,000,000.00.
(c) at all times, a ratio of Total Liabilities (excluding the
amount of Subordinated Debt that is included in the calculation of Tangible Net
Worth) to Tangible Net Worth not to exceed 5.0:1.0.
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ARTICLE VIII
NEGATIVE COVENANTS
So long as any Loan or other Obligation shall remain unpaid or
unsatisfied, or any Letter of Credit shall remain outstanding, unless the Banks
waive compliance in writing:
8.01 Limitation on Liens. The Borrower shall not, and shall not
suffer or permit any Subsidiary to, directly or indirectly, make, create, incur,
assume or suffer to exist any Lien upon or with respect to any part of its
property, whether now owned or hereafter acquired, other than the following
("Permitted Liens"):
(a) any Lien existing on property of the Borrower or any of
its Subsidiaries on the Closing Date and set forth in Schedule 8.01 securing
Indebtedness outstanding on such date;
(b) any Lien created under any Loan Document;
(c) Liens for taxes, fees, assessments or other governmental
charges which are not delinquent or remain payable without penalty, or to the
extent that non-payment thereof is permitted by Section 7.07, provided, however,
that no notice of lien has been filed or recorded under the Code;
(d) carriers', warehousemen's, mechanics', landlords',
materialmen's, repairmen's or other similar Liens arising in the ordinary course
of business which are not delinquent or remain payable without penalty and, with
respect to any such warehousemen's or landlord's lien, such liens only secure
accrued rental charges;
(e) Liens (other than any Lien imposed by ERISA) consisting of
pledges or deposits required in the ordinary course of business in connection
with workers' compensation, unemployment insurance and other social security
legislation;
(f) Liens on the property of the Borrower or its Subsidiaries
securing (i) the non-delinquent performance of bids, trade contracts (other than
for borrowed money), leases, statutory obligations, (ii) contingent obligations
on surety and appeal bonds, and (iii) other non-delinquent obligations of a like
nature; in each case, incurred in the ordinary course of business; provided,
however, that all such Liens in the aggregate would not (even if enforced) cause
a Material Adverse Effect;
(g) Liens consisting of judgment or judicial attachment liens;
provided, however, that the enforcement of such Liens is effectively stayed and
all such unstayed liens in the aggregate at any time outstanding for the
Borrower and its Subsidiaries do not exceed $250,000.00;
(h) easements, rights-of-way, restrictions and other similar
encumbrances incurred in the ordinary course of business which, in the
aggregate, are not substantial in amount, and which do not in any case
materially interfere with the ordinary conduct of the business of the Borrower
and its Subsidiaries;
60
(i) purchase money security interests (other than capital
leases) on any property acquired or held by the Borrower or its Subsidiaries in
the ordinary course of business, securing Indebtedness incurred or assumed for
the purpose of financing all or any part of the cost of acquiring such property;
provided, however, that (i) any such Lien attaches to such property concurrently
with or within 20 days after the acquisition thereof, (ii) such Lien attaches
solely to the property so acquired in such transaction, (iii) the principal
amount of the debt secured thereby does not exceed 100% of the cost of such
property, and (iv) the principal amount of the Indebtedness secured by any and
all such purchase money security interests shall not at any time exceed
$250,000.00;
(j) Liens of interest owners, including without limitation,
Liens arising as would be defined in Texas Bus. & Com. Code Section 9.343,
comparable laws of the states of Oklahoma, Kansas, Wyoming or New Mexico, or
other comparable law; and
(k) Liens not permitted by clause 8.01 (a), (b), (c), (d),
(e), (f), (g), (h) or (i), in an aggregate amount not to exceed $250,000.
(l) Liens securing contractual obligations permitted by
section 8.06.
8.02 Consolidations and Mergers. The Borrower shall not, nor
shall it suffer or permit any of its Subsidiaries to, merge, consolidate with or
into, or convey, transfer, lease or otherwise dispose of (whether in one
transaction or in a series of transactions) all or substantially all of its
assets (whether now owned or hereafter acquired) to or in favor of any Person.
8.03 Limitation on Indebtedness. The Borrower shall not suffer
or permit any of its Subsidiaries to, create, incur, assume, suffer to exist, or
otherwise become or remain directly or indirectly liable with respect to, any
Indebtedness, except:
(a) Indebtedness incurred pursuant to or in accordance with,
this Agreement;
(b) Indebtedness consisting of trade payables in the ordinary
course of business;
(c) Indebtedness existing on the Closing Date, and described
on Schedule 8.01;
(d) Indebtedness in respect of purchase money security
interests permitted by Section 8.01 hereof;
(e) Indebtedness in respect of Contingent Obligations
permitted by Section 8.06 hereof; and
(f) Subordinated Debt.
8.04 Transactions with Affiliates. The Borrower shall not, and
shall not suffer or permit any of its Subsidiaries to, enter into any
transaction with any Affiliate of the Borrower, except upon fair and reasonable
terms no less favorable to the Borrower or such Subsidiary than would obtain in
a comparable arm's-length transaction with a Person not an Affiliate of the
Borrower or such Subsidiary. Without limiting the foregoing, all sales of
Product by Borrower to, and purchases of Product by Borrower from, any Affiliate
of Borrower shall be at the market price on the day of sale, except for
transactions made in connection with Borrower's Index Sales Strategies which
strategies shall have been approved by the Banks prior to any such transactions.
61
8.05 Use of Proceeds. The Borrower shall not suffer or permit
any of its Subsidiaries to, use any portion of the Loan proceeds or any Letter
of Credit, directly or indirectly, (a) to purchase or carry Margin Stock, (b) to
repay or otherwise refinance indebtedness of the Borrower or others incurred to
purchase or carry Margin Stock, (c) to extend credit for the purpose of
purchasing or carrying any Margin Stock, or (d) to acquire any security in any
transaction that is subject to Section 13 or 14 of the Exchange Act.
8.06 Contingent Obligations. The Borrower shall not suffer or
permit any of its Subsidiaries to, create, incur, assume or suffer to exist any
Contingent Obligations except:
(a) endorsements for collection or deposit in the ordinary
course of business;
(b) swap contracts entered into in the ordinary course of
business as bona fide hedging transactions; and
(c) Contingent Obligations of the Borrower and its
Subsidiaries existing as of the Closing Date and described on Schedule 8.07.
8.07 Restricted Payments. The Borrower shall not suffer or
permit any of its Subsidiaries to, directly or indirectly declare or make, any
distribution of income or capital on account of any membership interest of the
Borrower now or hereafter in existence ("Distributions"), or set aside or
otherwise deposit or invest any sums for such purpose, except Distributions to
its members, so long as no Default or Event of Default has occurred or would
result therefrom.
8.08 ERISA. The Borrower shall not, nor suffer or permit any of
its ERISA Affiliates to: (a) engage in a prohibited transaction or violation of
the fiduciary responsibility rules with respect to any Plan; or (b) engage in a
transaction that could be subject to Section 4069 or 4212(c) of ERISA.
8.09 Change in Business. The Borrower shall not, nor suffer or
permit any of its Subsidiaries to, engage in any line of business different from
the line of business carried on by the Borrower and its Subsidiaries on the date
hereof.
8.10 Accounting Changes. The Borrower shall not, nor suffer or
permit any of its Subsidiaries to, make any significant change in accounting
treatment or reporting practices, except as required by GAAP, or change the
fiscal year of the Borrower or of any Subsidiary.
8.11 Net Position. At no time will the Borrower allow its Net
Position to exceed 5,000,000 MMBTUS of natural gas. At no time will the Borrower
allow the sum of the following: (a) 25% of the Borrower's Net Position Value,
plus (b) Borrower's Transportation and Storage Exposure, plus (c) Borrower's
Below Index Sales Exposure, to exceed 33% of Borrower's Net Working Capital at
such time, where,
"Net Position Value" means Borrower's Net Position valued at
$3.00/MMBTU.
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"Below Index Sales Exposure" means (the maximum volume of gas
required to be sold at below index prices multiplied by the
discount from index), minus (the net positive value of all
hedge contracts related to the utilization of the related
storage & transportation assets).
"Transportation and Storage Exposure" means the aggregate
contractual cost of transportation & storage contracts for a
term of in excess of 3 months.
8.12 Loans and Investments. The Borrower shall not purchase or
acquire, or suffer or permit any Subsidiary to purchase or acquire, or make any
commitment therefor, any capital stock, equity interest, or any obligations or
other securities of, or any interest in, any Person, or make or commit to make
any Acquisitions, or make or commit to make any advance, loan, extension of
credit or capital contribution to or any other investment in, any Person
including any Affiliate of Borrower, except for:
(a) investments in cash equivalents and Marketable Securities;
and
(b) extensions of credit in the nature of accounts receivable
or notes receivable arising from the sale or lease of goods or services in the
ordinary course of business.
8.13 Change of Management. Borrower shall not permit any
Change of Management. For purposes of this Section 8.13, "Change of Management"
shall mean that ▇. ▇. ▇▇▇▇▇▇▇▇ has ceased to act in his capacity as chief
executive officer of the Borrower.
8.14 Deposit Accounts. Borrower shall not maintain any deposit
accounts with a bank or financial institution other than the Bank Blocked
Account with the Collateral Agent, except that the Borrower may maintain the
Lock Box with Bank of America, N.A. which shall be pledged to the Administrative
Agent, for the benefit of the Agents, the Issuing Banks and the Banks pursuant
to the Three Party Agreement.
8.15 Risk Management Policy. The Borrower will not materially
change its risk management policies without the prior written consent of the
Administrative Agent and the Banks. Borrower agrees that upon request by Agents,
from time to time, the Borrower and the Banks will review and evaluate
Borrower's risk management policies.
8.16 Swap-Related Standby Letters of Credit. The Borrower shall
not permit outstanding Swap-Related Standby Letters of Credit plus any net
▇▇▇▇-to-Market values of amounts owed to Swap Banks by the Borrower under Swap
Contracts to exceed $50,000,000.
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ARTICLE IX
EVENTS OF DEFAULT
9.01 Event of Default. Any of the following shall constitute
an "Event of Default":
(a) Non-Payment. The Borrower fails to pay any amount payable
hereunder or under any other Loan Document when due including without limitation
such amounts as may come due as a result of a "demand" made by the Banks under
the Notes; or
(b) Representation or Warranty. Any representation or warranty
made or deemed made herein, in any other Loan Document, or which is contained in
any certificate, document or financial or other statement by the Borrower, or
any Responsible Officer furnished at any time under this Agreement, or in or
under any other Loan Document, is incorrect or incomplete in any respect on or
as of the date made or deemed made; or
(c) Covenant Defaults. The Borrower fails to perform or
observe any other term, covenant or agreement contained in any of the Loan
Documents; or
(d) Cross-Default. The Borrower or any Subsidiary of the
Borrower (i) fails to make any payment in respect of any Indebtedness or
Contingent Obligation 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 $250,000.00
when due (whether by scheduled maturity, required prepayment, acceleration,
demand, or otherwise); or (ii) fails to perform or observe any other material
condition or covenant, or any other event shall occur or condition exist, under
any agreement or instrument relating to any such Indebtedness or Contingent
Obligation, if, after expiration of any grace or cure period therein provided,
the effect of such failure, event or condition is to cause, or to permit the
holder or holders of such Indebtedness or beneficiary or beneficiaries of such
Indebtedness (or a trustee or agent on behalf of such holder or holders or
beneficiary or beneficiaries) to cause such Indebtedness to be declared to be
due and payable prior to its stated maturity, or such Contingent Obligation to
become payable or cash collateral in respect thereof to be demanded, except to
the extent that any such amounts are in bona fide dispute in an aggregate amount
not exceeding $250,000 for which adequate reserves are maintained in accordance
with GAAP; or
(e) Insolvency; Voluntary Proceedings. The Borrower or any
Subsidiary of the Borrower (i) ceases or fails to be solvent, or generally fails
to pay, or admits in writing its inability to pay, its debts as they become due,
whether at stated maturity or otherwise; (ii) commences any Insolvency
Proceeding with respect to itself; or (iii) takes any action to effectuate or
authorize any of the foregoing; or
(f) Involuntary Proceedings. (i) Any involuntary Insolvency
Proceeding is commenced or filed against the Borrower or any Subsidiary of the
Borrower, or any writ, judgment, warrant of attachment, execution or similar
process, is issued or levied against a substantial part of the Borrower or any
Subsidiary or any of any of the Borrower's properties, and any such proceeding
or petition shall not be dismissed, or such writ, judgment, warrant of
attachment, execution or similar process shall not be released, vacated or fully
bonded within 60 days after commencement, filing or levy; (ii) the Borrower or
any Subsidiary of the Borrower admits the material allegations of a petition
against it in any Insolvency Proceeding, or an order for relief (or similar
order under non-U.S. law) is ordered in any Insolvency Proceeding; or (iii) the
Borrower or any Subsidiary of the Borrower acquiesces in the appointment of a
receiver,
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trustee, custodian, conservator, liquidator, mortgagee in possession (or agent
therefor), or other similar Person for itself or a substantial portion of its
property or business; or
(g) ERISA. (i) An ERISA Event shall occur with respect to a
Pension Plan or Multiemployer Plan which has resulted or could reasonably be
expected to result in liability of the Borrower under Title IV of ERISA to the
Pension Plan, Multiemployer Plan or the PBGC in an aggregate amount in excess of
$250,000.00; (ii) the aggregate amount of Unfunded Pension Liability among all
Pension Plans at any time exceeds $250,000.00; or (iii) the Borrower or any
ERISA Affiliate shall fail to pay when due, any installment payment with respect
to its withdrawal liability under Section 4201 of ERISA under a Multiemployer
Plan in an aggregate amount in excess of $250,000.00; or
(h) Monetary Judgments. One or more non-interlocutory
judgments, non-interlocutory orders, decrees or arbitration awards is entered
against the Borrower or any Subsidiary of the Borrower, which such judgment,
order, decree or award is not effectively stayed pending appeal thereof,
involving in the aggregate a liability as to any single or related series of
transactions, incidents or conditions, to pay an amount of $250,000.00 or more;
or
(i) Non-Monetary Judgments. Any non-monetary judgment, order
or decree is entered against the Borrower or any Subsidiary of the Borrower
which does or would reasonably be expected to have a Material Adverse Effect; or
(j) Change of Control. There occurs any Change of Control not
previously approved by the Banks; or
(k) Adverse Change. There occurs a Material Adverse Effect; or
(l) Guarantor Defaults. Any Guarantor fails in any material
respect to perform or observe any term, covenant or agreement in the Guaranty
executed by such Guarantor; or such Guaranty is for any reason (other than
satisfaction in full of all Obligations and the termination of the Loans)
partially (including with respect to future advances) or wholly revoked or
invalidated, or otherwise ceases to be in full force and effect, or such
Guarantor or any other Person contests in any manner the validity or
enforceability thereof or denies that it has any further liability or obligation
thereunder; or any event described at subsections (e) or (f) of this Section
occurs with respect to such Guarantor.
IN NO EVENT SHALL ANY PROVISION OF THIS AGREEMENT PROVIDING FOR SPECIFIC EVENTS
OF DEFAULT BE CONSTRUED TO WAIVE, LIMIT OR OTHERWISE MODIFY THE DEMAND NATURE OF
THE LOANS WHICH MAY BE MADE PURSUANT TO THIS AGREEMENT, AND THE BORROWER HEREBY
ACKNOWLEDGES AND AGREES THAT THE BANKS' RIGHT TO DEMAND PAYMENT AT ANY TIME FOR
ANY REASON OR FOR NO REASON IS ABSOLUTE AND UNCONDITIONAL.
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9.02 Remedies. If any Event of Default occurs, the
Administrative Agent may and shall, at the request of the Required Banks:
(a) declare an amount equal to the maximum aggregate amount
that is or at any time thereafter may become available for drawing by the
beneficiary under any outstanding Letters of Credit (whether or not any
beneficiary shall have presented, or shall be entitled at such time to present,
the drafts or other documents required to draw under such Letters of Credit) to
be immediately due and payable, and declare the unpaid principal amount of all
outstanding Loans, all interest accrued and unpaid thereon, and all other
amounts owing or payable hereunder or under any other Loan Document to be
immediately due and payable, without presentment, demand, protest or other
notice of any kind, all of which are hereby expressly waived by the Borrower;
and
(b) exercise on behalf of itself and the Banks all rights and
remedies available to it and the Banks under the Loan Documents or applicable
law including, without limitation, seeking to lift the stay in effect under the
Proceeding; provided, however, that upon the occurrence of any event specified
in subsection (e) or (f) of Section 9.01, the obligation of each Bank to make
Loans and any obligation of an Issuing Bank to Issue Letters of Credit shall
automatically terminate and an amount equal to the maximum aggregate amount that
is or at any time thereafter may become available for drawing by the beneficiary
under any outstanding Letters of Credit (whether or not any beneficiary shall
have presented, or shall be entitled at such time to present, the drafts or
other documents required to draw under such Letters of Credit) together with the
unpaid principal amount of all outstanding Loans and all interest and other
amounts as aforesaid shall automatically become due and payable without further
act of the Administrative Agent, any Issuing Bank or any Bank.
9.03 Rights Not Exclusive. The rights provided for in this
Agreement and the other Loan Documents are cumulative and are not exclusive of
any other rights, powers, privileges or remedies provided by law or in equity,
or under any other instrument, document or agreement now existing or hereafter
arising.
ARTICLE X
AGENTS
10.01 Appointment and Authorization.
(a) Each Bank hereby irrevocably (subject to Section 10.09)
appoints, designates and authorizes the Agents to take such action on its behalf
under the provisions of this Agreement and each other Loan Document and to
exercise such powers and perform such duties as are expressly delegated to it by
the terms of this Agreement or any other Loan Document, together with such
powers as are reasonably incidental thereto. Notwithstanding any provision to
the contrary contained elsewhere in this Agreement or in any other Loan
Document, the Agents shall not have any duties or responsibilities, except those
expressly set forth herein, nor shall the Agents have or be deemed to have any
fiduciary relationship with any Bank, and no implied covenants, functions,
responsibilities, duties, obligations or liabilities shall be read into this
Agreement or any other Loan Document or otherwise exist against the Agents.
Without limiting the generality of the foregoing sentence, the use of the term
"agent" in this Agreement with reference to the Agents is not intended to
connote any fiduciary or other implied (or express) obligations arising under
agency doctrine of any applicable law. Instead, such term is
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used merely as a matter of market custom and is intended to create or reflect
only an administrative relationship between independent contracting parties.
(b) Each Issuing Bank shall act on behalf of the Banks with
respect to any Letters of Credit Issued by it and the documents associated
therewith until such time and except for so long as the Administrative Agent may
agree at the request of the Banks to act for such Issuing Bank with respect
thereto; provided, however, that such Issuing Bank shall have all of the
benefits and immunities (i) provided to the Administrative Agent in this Article
X with respect to any acts taken or omissions suffered by such Issuing Bank in
connection with Letters of Credit Issued by it or proposed to be Issued by it
and the application and agreements for letters of credit pertaining to the
Letters of Credit as fully as if the term "Administrative Agent," as used in
this Article X, included such Issuing Bank with respect to such acts or
omissions, and (ii) as additionally provided in this Agreement with respect to
such Issuing Banks. Prior to the issuance of a Letter of Credit by an Issuing
Bank other than the Administrative Agent, such Issuing Bank shall provide
written notice to the Administrative Agent of the dollar amount, the date of
such issuance and the expiry date of such Letter of Credit. Such issuance shall
be subject to the consent of the Administrative Agent. Such consent shall not
result in the imposition of any liability upon the Administrative Agent.
10.02 Delegation of Duties. Each of the Agents may execute any
of its duties under this Agreement or any other Loan Document by or through
agents, employees or attorneys-in-fact and shall be entitled to advice of
counsel concerning all matters pertaining to such duties. Neither of the Agents
shall not be responsible for the negligence or misconduct of any agent or
attorney-in-fact that it selects with reasonable care.
10.03 Liability of Agents. None of Agent-Related Persons shall
(a) be liable for any action taken or omitted to be taken by any of them under
or in connection with this Agreement or any other Loan Document or the
transactions contemplated hereby (except for its own gross negligence or willful
misconduct), or (b) be responsible in any manner to any of the Banks for any
recital, statement, representation or warranty made by the Borrower or any
Subsidiary or Affiliate of the Borrower, or any officer thereof, contained in
this Agreement or in any other Loan Document, or in any certificate, report,
statement or other document referred to or provided for in, or received by
Agents under or in connection with, this Agreement or any other Loan Document,
or for the value of or title to any Collateral, or the validity, effectiveness,
genuineness, enforceability or sufficiency of this Agreement or any other Loan
Document, or for any failure of the Borrower or any other party to any Loan
Document to perform its obligations hereunder or thereunder. No Agent-Related
Person shall be under any obligation to any Bank to ascertain or to inquire as
to the observance or performance of any of the agreements contained in, or
conditions of, this Agreement or any other Loan Document, or to inspect the
properties, books or records of the Borrower or any of the Borrower's
Subsidiaries or Affiliates.
10.04 Reliance by Agents.
(a) Each of the Agents shall be entitled to rely, and shall be
fully protected in relying, upon any writing, resolution, notice, consent,
certificate, affidavit, letter, telegram, facsimile, telex or telephone message,
statement or other document or conversation believed by it to be genuine and
correct and to have been signed, sent or made by the proper Person
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or Persons, and upon advice and statements of legal counsel (including counsel
to the Borrower), independent accountants and other experts selected by Agents.
Each of the Agents shall be fully justified in failing or refusing to take any
action under this Agreement or any other Loan Document unless it shall first
receive such advice or concurrence of all of the Banks or the Required Banks, as
applicable, as it deems appropriate and, if it so requests, it shall first be
indemnified to its satisfaction by the Banks against any and all liability and
expense which may be incurred by it by reason of taking or continuing to take
any such action. Each of the Agents shall in all cases be fully protected in
acting, or in refraining from acting, under this Agreement or any other Loan
Document in accordance with a request or consent of all of the Banks or the
Required Banks, as applicable, and such request and any action taken or failure
to act pursuant thereto shall be binding upon the Banks.
(b) For purposes of determining compliance with the conditions
specified in Section 5.01, each Bank that has executed this Agreement shall be
deemed to have consented to, approved or accepted or to be satisfied with, each
document or other matter either sent by Agents to such Bank for consent,
approval, acceptance or satisfaction, or required thereunder to be consented to
or approved by or acceptable or satisfactory to the Bank.
10.05 Notice of Default. Agents shall not be deemed to have
knowledge or notice of the occurrence of any Default or Event of Default, except
with respect to defaults in the payment of principal, interest and fees required
to be paid to the Administrative Agent for the account of the Banks, unless the
Administrative Agent shall have received written notice from a Bank or the
Borrower referring to this Agreement, describing such Default or Event of
Default and stating that such notice is a "notice of default." The
Administrative Agent will notify the BNP Paribas, as an agent, and the Banks of
its receipt of any such notice. The Agents shall take such action with respect
to such Default or Event of Default as may be requested by all of the Banks or
the Required Banks, as applicable, in accordance with Article IX; provided,
however, that unless and until the Administrative Agent has received any such
request, the Agents may (but shall not be obligated to) take such action, or
refrain from taking such action, with respect to such Default or Event of
Default as it shall deem advisable or in the best interest of the Banks.
10.06 Credit Decision. Each Bank acknowledges that none of
Agent-Related Persons has made any representation or warranty to it, and that no
act by Agents hereinafter taken, including any review of the affairs of the
Borrower and its Subsidiaries, shall be deemed to constitute any representation
or warranty by any Agent-Related Person to any Bank. Each Bank represents to the
Agents that it has, independently and without reliance upon any Agent-Related
Person and based on such documents and information as it has deemed appropriate,
made its own appraisal of and investigation into the business, prospects,
operations, property, financial and other condition and creditworthiness of the
Borrower and its Subsidiaries, the value of and title to any Collateral, and all
applicable bank regulatory laws relating to the transactions contemplated
hereby, and made its own decision to enter into this Agreement and to extend
credit to the Borrower hereunder. Each Bank also represents that it will,
independently and without reliance upon any Agent-Related Person and based on
such documents and information as it shall deem appropriate at the time,
continue to make its own credit analysis, appraisals and decisions in taking or
not taking action under this Agreement and the other Loan Documents, and to make
such investigations as it deems necessary to inform itself as to the business,
prospects, operations, property, financial and other condition and
creditworthiness of the Borrower. Except
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for notices, reports and other documents expressly herein required to be
furnished to the Banks by the Agents, the Agents shall not have any duty or
responsibility to provide any Bank with any credit or other information
concerning the business, prospects, operations, property, financial and other
condition or creditworthiness of the Borrower which may come into the possession
of any of Agent-Related Persons.
10.07 Indemnification. Whether or not the transactions
contemplated hereby are consummated, the Banks shall indemnify upon demand
Agent-Related Persons (to the extent not reimbursed by or on behalf of the
Borrower and without limiting the obligation of the Borrower to do so), pro
rata, from and against any and all Indemnified Liabilities; provided, however,
that no Bank shall be liable for the payment to Agent-Related Persons of any
portion of such Indemnified Liabilities resulting solely from such Person's
gross negligence or willful misconduct. Without limitation of the foregoing,
each Bank shall reimburse Agents upon demand for its ratable share of any costs
or out-of-pocket expenses (including Attorney Costs) incurred by Agents in
connection with the preparation, execution, delivery, administration,
modification, amendment or enforcement (whether through negotiations, legal
proceedings or otherwise) of, or legal advice in respect of rights or
responsibilities under, this Agreement, any other Loan Document, or any document
contemplated by or referred to herein, to the extent that Agents are not
reimbursed for such expenses by or on behalf of the Borrower. The undertaking in
this Section shall survive the payment of all Obligations hereunder and the
resignation or replacement of Agents.
10.08 Agents in Individual Capacity. Fortis and its Affiliates
and BNP Paribas and its Affiliates may make loans to, issue letters of credit
for the account of, accept deposits from, acquire equity interests in and
generally engage in any kind of banking, trust, financial advisory, underwriting
or other business with the Borrower and its Subsidiaries and Affiliates as
though Fortis and BNP Paribas were not Agents or Issuing Banks hereunder and
without notice to or consent of the Banks. The Banks acknowledge that, pursuant
to such activities, Fortis or its Affiliates and BNP Paribas or its Affiliates
may receive information regarding the Borrower or its Affiliates (including
information that may be subject to confidentiality obligations in favor of the
Borrower or such Subsidiary) and acknowledge that the Agents shall be under no
obligation to provide such information to them. With respect to its Loans,
Fortis and BNP Paribas shall have the same rights and powers under this
Agreement as any other Bank and may exercise the same as though it were not the
Agents or Issuing Banks, and the terms "Bank" and "Banks" include each of Fortis
and BNP Paribas in its individual capacity.
10.09 Successor Administrative Agent. The Administrative Agent
may resign as the Administrative Agent upon thirty (30) days' notice to the
Banks. If the Administrative Agent resigns under this Agreement, BNP Paribas
shall automatically become the successor agent, unless BNP Paribas declines. If
BNP Paribas declines, the Required Banks shall appoint, from among the Banks, a
successor agent for the Banks. If no successor agent is appointed prior to the
effective date of the resignation of the Administrative Agent, the resigning
Administrative Agent may appoint, after consulting with the Banks, a successor
agent from among the Banks. Upon the acceptance of its appointment as successor
agent hereunder, the successor agent shall succeed to all the rights, powers and
duties of the retiring Administrative Agent and the term "Administrative Agent"
shall mean such successor agent and the retiring Administrative Agent's
appointment, powers and duties as Administrative Agent shall be terminated.
After any retiring
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Administrative Agent's resignation hereunder as Administrative Agent, the
provisions of this Article X and Sections 11.04 and 11.05 shall inure to its
benefit as to any actions taken or omitted to be taken by it while it was
Administrative Agent under this Agreement. If no successor agent has accepted
appointment as the Administrative Agent by the date which is thirty (30) days
following a retiring Administrative Agent's notice of resignation, the retiring
Administrative Agent's resignation shall nevertheless thereupon become effective
and the Banks shall perform all of the duties of the Administrative Agent
hereunder until such time, if any, as the Banks appoint a successor agent as
provided for above.
10.10 Withholding Tax.
(a) If any Bank is a "foreign corporation, partnership or
trust" within the meaning of the Code and such Bank claims exemption from, or a
reduction of, U.S. withholding tax under Sections 1441 or 1442 of the Code, such
Bank agrees with and in favor of the Administrative Agent, to deliver to the
Administrative Agent:
(i) if such Bank claims an exemption from, or a reduction
of, withholding tax under a United States tax treaty, properly
completed and executed copies of IRS Form W-8BEN before the payment of
any interest in the first calendar year and before the payment of any
interest in each third succeeding calendar year during which interest
may be paid under this Agreement;
(ii) if such Bank claims that interest paid under this
Agreement is exempt from United States withholding tax because it is
effectively connected with a United States trade or business of such
Bank, two properly completed and executed copies of IRS Form W-8ECI
before the payment of any interest is due in the first taxable year of
such Bank and in each succeeding taxable year of such Bank during which
interest may be paid under this Agreement; and
(iii) such other form or forms as may be required under the
Code or other laws of the United States as a condition to exemption
from, or reduction of, United States withholding tax.
Such Bank agrees to promptly notify the Administrative Agent of any change in
circumstances which would modify or render invalid any claimed exemption or
reduction.
(b) If any Bank claims exemption from, or reduction of,
withholding tax under a United States tax treaty by providing IRS Form W-8BEN
and such Bank sells, assigns, grants a participation in, or otherwise transfers
all or part of the Obligations of the Borrower to such Bank, such Bank agrees to
notify the Administrative Agent of the percentage amount in which it is no
longer the beneficial owner of Obligations of the Borrower to such Bank. To the
extent of such percentage amount, the Administrative Agent will treat such
Bank's IRS Form W-8BEN as no longer valid.
(c) If any Bank claiming exemption from United States
withholding tax by filing IRS Form W-8ECI with the Administrative Agent sells,
assigns, grants a participation in, or otherwise transfers all or part of the
Obligations of the Borrower to such Bank, such Bank agrees to undertake sole
responsibility for complying with the withholding tax requirements imposed by
Sections 1441 and 1442 of the Code.
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(d) If any Bank is entitled to a reduction in the applicable
withholding tax, the Administrative Agent may withhold from any interest payment
to such Bank an amount equivalent to the applicable withholding tax after taking
into account such reduction. However, if the forms or other documentation
required by subsection (a) of this Section are not delivered to the
Administrative Agent, then the Administrative Agent may withhold from any
interest payment to such Bank not providing such forms or other documentation an
amount equivalent to the applicable withholding tax imposed by Sections 1441 and
1442 of the Code, without reduction.
(e) If the IRS or any other Governmental Authority of the
United States or other jurisdiction asserts a claim that the Administrative
Agent did not properly withhold tax from amounts paid to or for the account of
any Bank (because the appropriate form was not delivered, was not properly
executed, or because such Bank failed to notify the Administrative Agent of a
change in circumstances which rendered the exemption from, or reduction of,
withholding tax ineffective, or for any other reason) such Bank shall indemnify
the Administrative Agent fully for all amounts paid, directly or indirectly, by
the Administrative Agent as tax or otherwise, including penalties and interest,
and including any taxes imposed by any jurisdiction on the amounts payable to
the Administrative Agent under this Section, together with all costs and
expenses (including Attorney Costs), except to the extent caused solely by the
gross negligence or willful misconduct of the Administrative Agent. The
obligation of the Banks under this Subsection shall survive the payment of all
Obligations and the resignation or replacement of the Administrative Agent.
10.11 Collateral Matters. (a) The Agents are authorized on
behalf of all the Banks, without the necessity of any notice to or further
consent from the Banks, from time to time to take any action with respect to any
Collateral or the Loan Documents which may be necessary to perfect and maintain
perfected the security interest in and Liens upon the Collateral granted
pursuant to the Loan Documents.
(b) The Banks irrevocably authorize the Agents, at their
option and in their discretion, to release any Lien granted to or held by the
Administrative Agent upon any Collateral (I) upon payment in full of all Loans
and all other Obligations known to the Agents and payable under this Agreement
or any other Loan Document; (ii) constituting property sold or to be sold or
disposed of as part of or in connection with any disposition permitted
hereunder; (iii) constituting property in which the Borrower or any Subsidiary
owned no interest at the time the Lien was granted or at any time thereafter;
(iv) constituting property leased to the Borrower or any Subsidiary under a
lease which has expired or been terminated in a transaction permitted under this
Agreement or is about to expire and which has not been, and is not intended by
the Borrower or such Subsidiary to be, renewed or extended; (v) consisting of an
instrument evidencing Indebtedness or other debt instrument, if the indebtedness
evidenced thereby has been paid in full; or (vi) if approved, authorized or
ratified in writing by the all of the Banks. Upon request by the Agents at any
time, the Banks will confirm in writing the Agents' authority to release
particular types or items of Collateral pursuant to this Subsection 10.11(b);
provided, however, that the absence of any such confirmation for whatever reason
shall not affect the Agents' rights under this Section 10.11.
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(c) Each Bank agrees with and in favor of each other (which
agreement shall not be for the benefit of the Borrower or any Subsidiary) that
the Borrower's obligations to such Bank under this Agreement and the other Loan
Documents is not and shall not be secured by any real property collateral now or
hereafter acquired by such Bank.
10.12 Monitoring Responsibility. Each Bank will make its own
credit decisions hereunder, including the decision whether or not to make
advances or consent to the Issuance of Letters of Credit, thus the Agents shall
have no duty to monitor the Collateral Position, the amounts outstanding under
sub-lines or the reporting requirements or the contents of reports delivered by
the Borrower. Each Bank assumes the responsibility of keeping itself informed at
all times.
ARTICLE XI
MISCELLANEOUS
11.01 Amendments and Waivers. No amendment, supplement,
modification or waiver of any provision of this Agreement or any other Loan
Document, and no consent with respect to any departure by the Borrower
therefrom, shall be effective unless the same shall be in accordance with the
provisions of this Section 11.01. The Required Banks may, or, with the written
consent of the Required Banks, the Administrative Agent may, from time to time,
(a) enter into with the Borrower written amendments, supplements or
modifications hereto and to the other Loan Documents for the purpose of adding
any provisions to this Agreement or the other Loan Documents or changing in any
manner the rights of the Banks or of the Borrower hereunder or thereunder or (b)
waive, on such terms and conditions as the Required Banks or the Administrative
Agent, as the case may be, may specify in such instrument, any of the
requirements of this Agreement or the other Loan Documents or any Default or
Event of Default and its consequences; provided, however, that no such waiver
and no such amendment, supplement or modification shall (i) reduce the amount or
extend the scheduled date of maturity of any Loan or of any installment thereof,
or reduce the stated rate of any interest or fee payable hereunder or extend the
scheduled date of any payment thereof or increase the amount or extend the
expiration date of any Bank's Uncommitted Line Portion, in each case without the
consent of each Bank affected thereby, or (ii) amend, modify or waive any
provision of this Section 11.01 or reduce the percentage specified in the
definition of Required Banks, or consent to the assignment or transfer by the
Borrower of any of its rights and obligations under this Agreement and the other
Loan Documents or release all or substantially all of the Collateral or release
a Guarantor from its obligations under a Guaranty, in each case without the
written consent of each of the Banks directly affected thereby, or (iii) amend,
modify or waive any provision of Section 10 without the written consent of the
Agents. Any such waiver and any such amendment, supplement or modification shall
apply equally to each of the Banks and shall be binding upon the Borrower, the
Banks, the Agents and all future holders of the Loans. In the case of any
waiver, the Borrower, the Banks and the Agents shall be restored to their former
positions and rights hereunder and under the other Loan Documents, and any
Default or Event of Default waived shall be deemed to be cured and not
continuing; but no such waiver shall extend
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to any subsequent or other Default or Event of Default or impair any right
consequent thereon. Any such waiver or consent shall be effective only in the
specific instance and for the specific purpose for which given.
11.02 Notices.
(a) All notices, requests and other communications shall be in
writing (including, unless the context expressly otherwise provides, by
facsimile transmission; provided, however, that any matter transmitted by the
Borrower by facsimile (i) shall be immediately confirmed by a telephone call to
the recipient at the number specified on Schedule 11.02, and (ii) shall be
followed promptly by delivery of a hard copy original thereof) and mailed, faxed
or delivered, to the address or facsimile number specified for notices on
Schedule 11.02; or, as directed to the Borrower or the Agents, to such other
address as shall be designated by such party in a written notice to the other
parties, and as directed to any other party, at such other address as shall be
designated by such party in a written notice to the Borrower and the Agents.
(b) All such notices, requests and communications shall, when
transmitted by overnight delivery, or faxed, be effective when delivered for
overnight (next-day) delivery, or transmitted in legible form by facsimile
machine, respectively, or if mailed, upon the third Business Day after the date
deposited into the U.S. mail, or if delivered, upon delivery; except that
notices pursuant to Articles II, III or X shall not be effective until actually
received by the Administrative Agent or Agents, as applicable.
(c) Any agreement of the Agents and the Banks herein to
receive certain notices by telephone or facsimile is solely for the convenience
and at the request of the Borrower. The Agents and the Banks shall be entitled
to rely on the authority of any Person purporting to be a Person authorized by
the Borrower to give such notice and the Agents and the Banks shall not have any
liability to the Borrower or other Person on account of any action taken or not
taken by the Agents or the Banks in reliance upon such telephonic or facsimile
notice, except to the extent of the gross negligence or willful misconduct of
the Agents or any Bank. The obligation of the Borrower to repay the Loans and
L/C Obligations shall not be affected in any way or to any extent by any failure
by the Agents and the Banks to receive written confirmation of any telephonic or
facsimile notice or the receipt by the Agents and the Banks of a confirmation
which is at variance with the terms understood by the Agents and the Banks to be
contained in the telephonic or facsimile notice.
11.03 No Waiver; Cumulative Remedies. No failure to exercise
and no delay in exercising, on the part of the Agents or any Bank, any right,
remedy, power or privilege hereunder, shall operate as a waiver thereof; nor
shall any single or partial exercise of any right, remedy, power or privilege
hereunder preclude any other or further exercise thereof or the exercise of any
other right, remedy, power or privilege.
11.04 Costs and Expenses. The Borrower shall:
(a) whether or not the transactions contemplated hereby are
consummated, pay or reimburse Fortis and BNP Paribas (including in their
capacity as Agents) within five (5) Business Days after demand (subject to
Subsection 5.01(e)) for all the actual and
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reasonable costs and expenses incurred by Fortis and BNP Paribas (including in
their capacity as Agents) in connection with the preparation, delivery, and
execution of, and any amendment, supplement, waiver or modification to (in each
case, whether or not consummated), this Agreement, any Loan Document and any
other documents prepared in connection herewith or therewith, and the
consummation of the transactions contemplated hereby and thereby, including
reasonable Attorney Costs and costs of commercial finance examinations, incurred
by Fortis and BNP Paribas (including in their capacity as Agents) excluding,
however, any costs or expenses incurred in connection with any negotiation,
dispute or claim solely between or among either of the Agents and/or one or more
of the Banks; and
(b) pay or reimburse the Agents and each Bank within five
Business Days after demand (subject to Subsection 5.01(e)) for all actual and
reasonable costs and expenses (including Attorney Costs) incurred by them in
connection with the monitoring, administration, enforcement, attempted
enforcement, or preservation of any rights or remedies under this Agreement or
any other Loan Document excluding, however, any costs or expenses incurred in
connection with any negotiation, dispute or claim solely between or among the
Agents and/or one or more of the Banks; and all such costs and expenses during
the existence of an Event of Default or after acceleration of the Loans
(including in connection with any "workout" or restructuring regarding the
Loans, and including in any Insolvency Proceeding or appellate proceeding).
11.05 INDEMNITY. WHETHER OR NOT THE TRANSACTIONS CONTEMPLATED
HEREBY ARE CONSUMMATED, THE BORROWER SHALL INDEMNIFY AND HOLD AGENT-RELATED
PERSONS, AND EACH BANK AND EACH OF ITS RESPECTIVE OFFICERS, DIRECTORS,
EMPLOYEES, COUNSEL, AGENTS AND ATTORNEYS-IN-FACT (EACH, AN "INDEMNIFIED PERSON")
HARMLESS FROM AND AGAINST ANY AND ALL LIABILITIES, OBLIGATIONS, LOSSES, DAMAGES,
PENALTIES, ACTIONS, JUDGMENTS, SUITS, COSTS, CHARGES, EXPENSES AND DISBURSEMENTS
(INCLUDING ATTORNEY COSTS) OF ANY KIND OR NATURE WHATSOEVER WHICH MAY AT ANY
TIME (INCLUDING AT ANY TIME FOLLOWING REPAYMENT OF THE LOANS, THE TERMINATION OF
THE LETTERS OF CREDIT AND THE TERMINATION, RESIGNATION OR REPLACEMENT OF THE
ADMINISTRATIVE AGENT OR REPLACEMENT OF ANY BANK) BE IMPOSED ON, INCURRED BY OR
ASSERTED AGAINST ANY SUCH PERSON IN ANY WAY RELATING TO OR ARISING OUT OF THIS
AGREEMENT OR ANY DOCUMENT CONTEMPLATED BY OR REFERRED TO HEREIN, OR THE
TRANSACTIONS CONTEMPLATED HEREBY, OR ANY ACTION TAKEN OR OMITTED BY ANY SUCH
PERSON UNDER OR IN CONNECTION WITH ANY OF THE FOREGOING, INCLUDING WITH RESPECT
TO ANY INVESTIGATION, LITIGATION OR PROCEEDING (INCLUDING ANY INSOLVENCY
PROCEEDING OR APPELLATE PROCEEDING) RELATED TO OR ARISING OUT OF THIS AGREEMENT
OR THE LOANS OR LETTERS OF CREDIT OR THE USE OF THE PROCEEDS THEREOF, WHETHER OR
NOT ANY INDEMNIFIED PERSON IS A PARTY THERETO (ALL THE FOREGOING, COLLECTIVELY,
THE "INDEMNIFIED LIABILITIES"); PROVIDED, HOWEVER, THAT THE BORROWER SHALL HAVE
NO OBLIGATION HEREUNDER TO ANY INDEMNIFIED PERSON FOR THAT PORTION OF ANY
INDEMNIFIED LIABILITIES THAT IS ADJUDGED BY A COURT OF COMPETENT JURISDICTION TO
HAVE BEEN CAUSED BY THE GROSS NEGLIGENCE OR WILLFUL MISCONDUCT OF SUCH
INDEMNIFIED PERSON OR THAT PORTION OF ANY INDEMNIFIED LIABILITIES WHICH ARE OWED
BY AN INDEMNIFIED PERSON TO ANY OTHER INDEMNIFIED PERSON, BUT IN ALL EVENTS, THE
BORROWER SHALL REMAIN LIABLE FOR THE REMAINDER OF THE INDEMNIFIED LIABILITIES
NOT SO EXCLUDED. THE AGREEMENTS IN THIS SECTION SHALL SURVIVE PAYMENT OF ALL
OTHER OBLIGATIONS.
74
11.06 Payments Set Aside. To the extent that the Borrower
makes a payment to the Agents or the Banks, or the Agents or the Banks exercise
their right of set-off, and such payment or the proceeds of such set-off or any
part thereof are subsequently invalidated, declared to be fraudulent or
preferential, set aside or required (including pursuant to any settlement
entered into by the Agents or such Bank in its discretion) to be repaid to a
trustee, receiver or any other party, in connection with any Insolvency
Proceeding or otherwise, then (a) to the extent of such recovery the obligation
or part thereof originally intended to be satisfied shall be revived and
continued in full force and effect as if such payment had not been made or such
set-off had not occurred, and (b) each Bank severally agrees to pay to each of
the Agents upon demand its pro rata share of any amount so recovered from or
repaid by the Agents.
11.07 Successors and Assigns. The provisions of this Agreement
shall be binding upon and inure to the benefit of the parties hereto and their
respective successors and assigns, except that the Borrower may not assign or
transfer any of its rights or Obligations under this Agreement without the prior
written consent of the Agents and each Bank.
11.08 Assignments, Participations, Etc.
(a) Any Bank, at any time may assign and delegate to one or
more Eligible Assignees (each an "Assignee") all, or any ratable part of all, of
the Loans, the Uncommitted Line, the L/C Obligations and the other rights and
obligations of such Bank hereunder, in a minimum amount of $1,000,000.00;
provided, however, that (i) any such disposition shall not, without the prior
consent of the Borrower, require the Borrower to apply to register or qualify
the Loan or any Note under the securities laws of any state, and (ii) the
Borrower and the Administrative Agent may continue to deal solely and directly
with such Bank in connection with the interest so assigned to an Assignee until
(x) written notice of such assignment, together with payment instructions,
addresses and related information with respect to the Assignee, shall have been
given to the Borrower and the Administrative Agent by such Bank and the
Assignee; (y) such Bank and its Assignee shall have delivered to the Borrower
and the Administrative Agent an Assignment and Acceptance ("Assignment and
Acceptance") in form attached hereto as Exhibit D, together with any Note or
Notes subject to such assignment; and (z) the assignor Bank or Assignee has paid
to the Administrative Agent a processing fee in the amount of $2,500.00.
(b) From and after the date that the Administrative Agent
notifies the assignor Bank that it has received an executed Assignment and
Acceptance and payment of the above-referenced processing fee, (i) the Assignee
thereunder shall be a party hereto and, to the extent that rights and
obligations hereunder have been assigned to it pursuant to such Assignment and
Acceptance, shall have the rights and obligations of a Bank under the Loan
Documents, and (ii) the assignor Bank shall, to the extent that rights and
obligations hereunder and under the other Loan Documents have been assigned by
it pursuant to such Assignment and Acceptance, relinquish its rights and be
released from its obligations under the Loan Documents.
(c) The Borrower shall execute and deliver to the
Administrative Agent, new Notes evidencing such Assignee's assigned Loans and
Uncommitted Line Portion and, if the assignor Bank has retained a portion of its
Loans and its Uncommitted Line Portion, replacement Notes in the principal
amount of the Loans retained by the assignor Bank (such Notes to be in
75
exchange for, but not in payment of, the Notes held by such Bank). Immediately
upon each Assignee's making its processing fee payment under the Assignment and
Acceptance, this Agreement shall be deemed to be amended to the extent, but only
to the extent, necessary to reflect the addition of the Assignee and the
resulting adjustment of the Uncommitted Line Portion arising therefrom. The
Uncommitted Line Portion allocated to each Assignee shall reduce such
Uncommitted Line Portion of the assigning Bank pro tanto. Upon such Assignment,
the Administrative Agent is authorized to revise Schedule 2.01 and Schedule
11.02 to reflect the adjusted status of the Banks.
(d) Any Bank may at any time sell to one or more commercial
banks or other Persons not Affiliates of the Borrower (a "Participant")
participating interests in any Loans, the Uncommitted Line Portion of that Bank
and the other interests of that Bank (the "originating Bank") hereunder and
under the other Loan Documents; provided, however, that (i) the originating
Bank's and the Borrower's obligations under this Agreement shall remain
unchanged, (ii) the originating Bank shall remain solely responsible for the
performance of such obligations, (iii) the Borrower, the Issuing Banks and the
Administrative Agent shall continue to deal solely and directly with the
originating Bank in connection with the originating Bank's rights and
obligations under this Agreement and the other Loan Documents, and (iv) no Bank
shall transfer or grant any participating interest under which the Participant
has rights to approve any amendment to, or any consent or waiver with respect
to, this Agreement or any other Loan Document, except to the extent such
amendment, consent or waiver would require unanimous consent of the Banks as
described in the first proviso to Section 11.01. In the case of any such
participation, the Participant shall not have any rights under this Agreement,
or any of the other Loan Documents, and all amounts payable by the Borrower
hereunder shall be determined as if such Bank had not sold such participation;
except that, if amounts outstanding under this Agreement are due and unpaid, or
shall have been declared or shall have become due and payable upon the
occurrence of an Event of Default, each Participant shall be deemed to have the
right of set-off in respect of its participating interest in amounts owing under
this Agreement to the same extent as if the amount of its participating interest
were owing directly to it as a Bank under this Agreement.
(e) Each Bank agrees to take normal and reasonable precautions
and exercise due care to maintain the confidentiality of all information
identified as "confidential" or "secret" by the Borrower and provided to it by
the Borrower or any Subsidiary or Affiliate, or by the Agents on the Borrower or
Subsidiary's or Affiliate's behalf, under this Agreement or any other Loan
Document, and neither it nor any of its Affiliates shall use any such
information other than in connection with or in enforcement of this Agreement
and the other Loan Documents; except to the extent such information (i) was or
becomes generally available to the public other than as a result of disclosure
by the Bank, or (ii) was or becomes available on a non-confidential basis from a
source other than the Borrower; provided, however, that such source is not bound
by a confidentiality agreement with, or under obligation of confidentiality, the
Borrower known to the Bank; provided, however, that any Bank may disclose such
information (A) at the request or pursuant to any requirement of any
Governmental Authority to which the Bank is subject or in connection with an
examination of such Bank by any such authority; (B) pursuant to subpoena or
other court process; (C) when required to do so in accordance with the
provisions of any applicable Requirement of Law; (D) to the extent reasonably
required in connection with any litigation or proceeding to which the
Administrative Agent, any Bank or their respective
76
Affiliates may be party; (E) to the extent reasonably required in connection
with the exercise of any remedy hereunder or under any other Loan Document; (F)
to such Bank's independent auditors and other professional advisors; (G) to any
Affiliate of such Bank, or to any Participant or Assignee, actual or potential;
provided, however, that such Affiliate, Participant or Assignee agrees to keep
such information confidential to the same extent required of the Banks
hereunder, and (H) as to any Bank, as expressly permitted under the terms of any
other document or agreement regarding confidentiality to which the Borrower is
party or is deemed party with such Bank. The foregoing is not intended to limit
the Banks' obligations to maintain confidential information received from the
Borrower under applicable laws.
(f) Notwithstanding any other provision in this Agreement, any
Bank may at any time create a security interest in, or pledge, all or any
portion of its rights under and interest in this Agreement and the Note held by
it in favor of any Federal Reserve Bank in accordance with Regulation A of the
FRB or U.S. Treasury Regulation 31 CFR ss.203.14, and such Federal Reserve Bank
may enforce such pledge or security interest in any manner permitted under
applicable law.
11.09 Set-off. In addition to any rights and remedies of the
Banks provided by law, if an Event of Default exists or the Loans have been
accelerated, each Bank is authorized at any time and from time to time, without
prior notice to the Borrower, any such notice being waived by the Borrower to
the fullest extent permitted by law, to set off and apply any and all deposits
at any time held by, and other indebtedness at any time owing by, such Bank to
or for the credit or the account of the Borrower against any and all Obligations
owing to such Bank, now or hereafter existing, irrespective of whether or not
the Agents or such Bank shall have made demand under this Agreement or any Loan
Document and although such Obligations may be contingent or unmatured. Each Bank
agrees promptly to notify the Borrower and the Administrative Agent after any
such set-off and application made by such Bank; provided, however, that the
failure to give such notice shall not affect the validity of such set-off and
application.
11.10 Automatic Debits of Fees. With respect to any letter of
credit fee or other fee, interest or any other cost or expense (including
Attorney Costs) due and payable to the Agents, the Issuing Banks, Fortis or BNP
Paribas under the Loan Documents, the Borrower hereby irrevocably authorizes the
Collateral Agent to debit any deposit accounts of the Borrower with the
Collateral Agent (such deposit accounts being owned by the Collateral Agent and
under the exclusive dominion and control of the Collateral Agent) including the
Bank Blocked Account in an amount such that the aggregate amount debited from
all such deposit accounts does not exceed such fee or other cost or expense. If
there are insufficient funds in such deposit accounts to cover the amount of the
fee or other cost or expense then due, such debits will be reversed (in whole or
in part, in the Administrative Agent's sole discretion) and such amount not
debited shall be deemed to be unpaid. No such debit under this Section shall be
deemed a set-off.
11.11 Notification of Addresses, Lending Offices, Etc. Each
Bank shall notify the Agents in writing of any changes in the address to which
notices to the Bank should be directed, of addresses of any Lending Office, of
payment instructions in respect of all payments to be made to it hereunder and
of such other administrative information as the Agents shall reasonably request.
77
11.12 Bank Blocked Account Charges and Procedures. The
Collateral Agent is hereby authorized to (a) charge the Bank Blocked Account or
any deposit account of the Borrower maintained at the Collateral Agent for all
returned checks, service charges, and other fees and charges associated with the
deposits by the Borrower to and withdrawals by the Borrower from the Bank
Blocked Account; (b) follow its usual procedures in the event the Bank Blocked
Account or any check, draft or other order for payment of money should be or
become the subject of any writ, levy, order or other similar judicial or
regulatory order or process; (c) charge the Bank Blocked Account or any deposit
account of the Borrower maintained at the Collateral Agent for any Letter of
Credit reimbursement, Loan repayments, interest or fees; and (d) pay from the
Bank Blocked Account, on behalf of the Borrower, suppliers and other business
expenses of the Borrower. If the available balances in the Bank Blocked Account
relating to the Borrower are not sufficient to pay the Administrative Agent for
any returned check, draft or order for the payment of money relating to the
Borrower, or to compensate the Administrative Agent for any charges or fees due
the Administrative Agent with respect to the deposits by the Borrower to and
withdrawals by the Borrower from the Bank Blocked Account, the Borrower agrees
to pay on demand the amount due the Administrative Agent. The Borrower agrees
that it cannot, and will not, withdraw any monies from the Bank Blocked Account
and it will not permit the Bank Blocked Account to become subject to any other
pledge, assignment, lien, charge or encumbrance of any kind, nature or
description, other than the Administrative Agent's security interest.
11.13 Counterparts. This Agreement may be executed in any
number of separate counterparts, each of which, when so executed, shall be
deemed an original, and all of said counterparts taken together shall be deemed
to constitute but one and the same instrument.
11.14 Severability. The illegality or unenforceability of any
provision of this Agreement or any instrument or agreement required hereunder
shall not in any way affect or impair the legality or enforceability of the
remaining provisions of this Agreement or any instrument or agreement required
hereunder.
11.15 No Third Parties Benefited. This Agreement is made and
entered into for the sole protection and legal benefit of the Borrower, the
Banks, the Administrative Agent and Agent-Related Persons, and their permitted
successors and assigns, and no other Person shall be a direct or indirect legal
beneficiary of, or have any direct or indirect cause of action or claim in
connection with, this Agreement or any of the other Loan Documents.
11.16 GOVERNING LAW AND JURISDICTION.
(a) THIS AGREEMENT AND THE NOTES SHALL BE GOVERNED BY, AND
CONSTRUED IN ACCORDANCE WITH, THE LAW (WITHOUT REFERENCE TO PRINCIPLES OF
CONFLICTS OF LAWS) OF THE STATE OF NEW YORK; PROVIDED, HOWEVER, THAT THE
ADMINISTRATIVE AGENT AND THE BANKS SHALL RETAIN ALL RIGHTS ARISING UNDER FEDERAL
LAW.
(b) ANY LEGAL ACTION OR PROCEEDING WITH RESPECT TO THIS
AGREEMENT OR ANY OTHER LOAN DOCUMENT MAY BE BROUGHT IN THE STATE COURTS LOCATED
IN NEW YORK COUNTY, CITY OF NEW YORK,
▇▇
▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇ ▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇ DISTRICT COURT FOR THE SOUTHERN
DISTRICT OF NEW YORK, AND BY EXECUTION AND DELIVERY OF THIS AGREEMENT, EACH OF
THE BORROWER, THE ADMINISTRATIVE AGENT AND THE BANKS CONSENTS, FOR ITSELF AND IN
RESPECT OF ITS PROPERTY, TO THE NON-EXCLUSIVE JURISDICTION OF THOSE COURTS. EACH
OF THE BORROWER, THE ADMINISTRATIVE AGENT AND THE BANKS IRREVOCABLY WAIVES ANY
OBJECTION, INCLUDING ANY OBJECTION TO THE LAYING OF VENUE OR BASED ON THE
GROUNDS OF FORUM NON CONVENIENS, WHICH IT MAY NOW OR HEREAFTER HAVE TO THE
BRINGING OF ANY ACTION OR PROCEEDING IN SUCH JURISDICTION IN RESPECT OF THIS
AGREEMENT OR ANY DOCUMENT RELATED HERETO. THE BORROWER HEREBY WAIVES PERSONAL
SERVICE OF ANY AND ALL PROCESS UPON THE BORROWER AND IRREVOCABLY APPOINTS
CORPORATION SERVICE COMPANY, ▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇, AS REGISTERED
AGENT FOR THE PURPOSE OF ACCEPTING SERVICE OF PROCESS WITHIN THE STATE OF NEW
YORK AND AGREES TO OBTAIN A LETTER FROM CORPORATION SERVICE COMPANY,
ACKNOWLEDGING SAME AND CONTAINING THE AGREEMENT OF CORPORATION SERVICE COMPANY,
TO PROVIDE THE ADMINISTRATIVE AGENT WITH THIRTY (30) DAYS ADVANCE NOTICE PRIOR
TO ANY RESIGNATION OF CORPORATION SERVICE COMPANY AS SUCH REGISTERED AGENT.
11.17 WAIVER OF JURY TRIAL. THE BORROWER, THE BANKS AND THE
AGENTS EACH WAIVE THEIR RESPECTIVE RIGHTS TO A TRIAL BY JURY OF ANY CLAIM OR
CAUSE OF ACTION BASED UPON OR ARISING OUT OF OR RELATED TO THIS AGREEMENT, THE
OTHER LOAN DOCUMENTS, OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY, IN ANY
ACTION, PROCEEDING OR OTHER LITIGATION OF ANY TYPE BROUGHT BY ANY OF THE PARTIES
AGAINST ANY OTHER PARTY OR ANY AGENT-RELATED PERSON, PARTICIPANT OR ASSIGNEE,
WHETHER WITH RESPECT TO CONTRACT CLAIMS, TORT CLAIMS, OR OTHERWISE. THE
BORROWER, THE BANKS AND THE ADMINISTRATIVE AGENT EACH AGREE THAT ANY SUCH CLAIM
OR CAUSE OF ACTION SHALL BE TRIED BY A COURT TRIAL WITHOUT A JURY. WITHOUT
LIMITING THE FOREGOING, THE PARTIES FURTHER AGREE THAT THEIR RESPECTIVE RIGHT TO
A TRIAL BY JURY IS WAIVED BY OPERATION OF THIS SECTION AS TO ANY ACTION,
COUNTERCLAIM OR OTHER PROCEEDING WHICH SEEKS, IN WHOLE OR IN PART, TO CHALLENGE
THE VALIDITY OR ENFORCEABILITY OF THIS AGREEMENT OR THE OTHER LOAN DOCUMENTS OR
ANY PROVISION HEREOF OR THEREOF. THIS WAIVER SHALL APPLY TO ANY SUBSEQUENT
AMENDMENTS, RENEWALS, SUPPLEMENTS OR MODIFICATIONS TO THIS AGREEMENT AND THE
OTHER LOAN DOCUMENTS.
11.18 DISCRETIONARY FACILITY. THE BORROWER ACKNOWLEDGES AND
AGREES THAT THIS AGREEMENT PROVIDES FOR A CREDIT FACILITY THAT IS COMPLETELY
DISCRETIONARY ON THE PART OF THE BANKS AND THAT THE BANKS HAVE ABSOLUTELY NO
DUTY OR OBLIGATION TO ADVANCE ANY
79
REVOLVING LOANS OR TO ISSUE ANY LETTER OF CREDIT. THE BORROWER UNDERSTANDS THAT
WITHOUT REASON, CAUSE OR PRIOR NOTICE, THE BANKS MAY CEASE ADVANCING REVOLVING
LOANS AND ISSUING LETTERS OF CREDIT AND MAKE DEMAND FOR PAYMENT OF ALL
OBLIGATIONS OF BORROWER TO THE BANKS AT ANY TIME. BORROWER REPRESENTS AND
WARRANTS TO THE BANKS THAT BORROWER IS AWARE OF THE RISKS ASSOCIATED WITH
CONDUCTING BUSINESS UTILIZING AN UNCOMMITTED FACILITY.
11.19 Entire Agreement. THIS AGREEMENT, TOGETHER WITH THE
OTHER LOAN DOCUMENTS, EMBODIES THE ENTIRE AGREEMENT AND UNDERSTANDING AMONG THE
BORROWER, THE BANKS AND THE ADMINISTRATIVE AGENT, AND SUPERSEDES ALL PRIOR OR
CONTEMPORANEOUS AGREEMENTS AND UNDERSTANDINGS OF SUCH PERSONS, VERBAL OR
WRITTEN, RELATING TO THE SUBJECT MATTER HEREOF AND THEREOF.
11.20 Effect of Amendment and Restatement. On the Closing
Date, the Original Credit Agreement shall be amended, restated and superseded in
its entirety by this Agreement. The parties hereto acknowledge and agree that
the liens and security interests granted under the Security Agreements (as
defined in the Original Credit Agreement) are continuing and in full force and
effect and, upon the amendment and restatement of the Original Credit Agreement
pursuant to this Agreement, such liens and security interests secure and
continue to secure the payment of the Obligations, and that the Notes
outstanding under and as defined in the Original Credit Agreement are, upon the
Closing Date, replaced by the Notes issued hereunder.
80
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed and delivered by their proper and duly authorized
officers as of the day and year first above written.
▇▇▇▇▇▇▇▇ MARKETING, L.L.C.,
a Delaware limited liability company
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇
----------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇
----------------------------
Title: Senior Vice President
---------------------------
Borrower's Address:
▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
FORTIS CAPITAL CORP., a Connecticut corporation as
Administrative Agent, Collateral Agent, and a Bank
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
----------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
----------------------------
Title: Senior Vice President
---------------------------
By: /s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇
----------------------------------
Name: ▇▇▇▇▇▇▇ ▇▇▇▇▇
----------------------------
Title: Director
---------------------------
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
[▇▇▇▇▇▇▇▇ - Credit Agreement]
81
FORTIS CAPITAL CORP.,
a Connecticut corporation,
as a Bank and Issuing Bank
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
----------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
----------------------------
Title: Senior Vice President
---------------------------
By: /s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇
----------------------------------
Name: ▇▇▇▇▇▇▇ ▇▇▇▇▇
----------------------------
Title: Director
---------------------------
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
82
BNP PARIBAS,
a bank organized under the laws of France, as a
Bank, Issuing Bank, and Documentation Agent
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇
----------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇
----------------------------
Title: Director
---------------------------
By: /s/ SALI WIN
----------------------------------
Name: Sali Win
----------------------------
Title: Director
---------------------------
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
83
SOCIETE GENERALE,
as a Bank
By: /s/ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
---------------------
Name: ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
----------------------------
Title: Director
---------------------------
▇▇▇▇ ▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
NATEXIS BANQUES POPULAIRES,
NEW YORK BRANCH,
as a Bank
By: /s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇
----------------------------------
Name: ▇▇▇▇▇ ▇▇▇▇▇▇▇
----------------------------
Title: Vice President
---------------------------
By: /s/ GUILLAUME DE PARSCAU
------------------------
Name: Guillaume de Parscau
----------------------------
Title: First Vice President
---------------------------
1251 Avenue of the ▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
84
RZB FINANCE LLC,
as a Bank
By: /s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
----------------------------------
Name: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
----------------------------
Title: Group Vice President
---------------------------
▇▇▇▇ ▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
85
Schedule 2.01-1
SCHEDULE 2.01
UNCOMMITTED LINE AND
UNCOMMITTED LINE PORTION
(EXCLUDING SWAP CONTRACTS)
I. UNCOMMITTED LINE:
A. Maximum Line: $250,000,000.00
B. Total Line Amount
Subscribed: $210,000,000.00
C. Subscribed Percentage: 84%
II. UNCOMMITTED LINE PORTIONS, SUBSCRIBED AMOUNTS:
Line: Bank Dollar Amount Share
---- ---- ------------- -----
Borrowing Base Line Fortis Capital Corp. $ 75,000,000.00 35.71428%
BNP Paribas $ 75,000,000.00 35.71428%
Societe Generale $ 35,000,000.00 16.66667%
Natexis Banques Populaires,
New York Branch $ 15,000,000.00 7.14285%
RZB Finance LLC $ 10,000,000.00 4.76190%
TOTAL SUBSCRIBED LINE PORTIONS $210,000,000.00 100%
Schedule 2.01-1
SCHEDULE 3.10
EXISTING LETTERS OF CREDIT
[To be completed.]
Schedule 3.10-1
SCHEDULE 6.05
LITIGATION, AND PATENT, TRADEMARK, ETC. CLAIMS
None.
Schedule 6.05-1
SCHEDULE 6.07
ERISA MATTERS
None.
Schedule 6.07-1
SCHEDULE 6.12
ENVIRONMENTAL MATTERS
None.
Schedule 6.12-1
SCHEDULE 6.16
SUBSIDIARIES AND EQUITY INVESTMENTS
Southern Resources, Inc.
Schedule 6.16-1
SCHEDULE 6.17
INSURANCE MATTERS
None.
Schedule 6.17-1
SCHEDULE 7.03(F)
LOCATIONS OF INVENTORY STORAGE
North Liberty, Kansas
Saltville, Virginia
Barnsley, Kentucky
East Diamond, Kentucky
Bearcreek, Louisiana
▇▇▇▇, Louisiana
Schedule 7.03(f)-1
SCHEDULE 8.01
PERMITTED INDEBTEDNESS AND LIENS
None.
Schedule 8.01-1
SCHEDULE 8.07
CONTINGENT OBLIGATIONS
None.
Schedule 8.07-1
SCHEDULE 11.02
LENDING OFFICES AND ADDRESSES FOR NOTICES
FORTIS CAPITAL CORP.,
--------------------
as Administrative Agent and Collateral Agent
Fortis Capital Corp.
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
FORTIS CAPITAL CORP.,
--------------------
as Issuing Bank and a Bank
Fortis Capital Corp.
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
BNP PARIBAS,
-----------
as Documentation Agent
BNP Paribas
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Schedule 11.02-1
BNP PARIBAS,
-----------
as Issuing Bank and a Bank
BNP Paribas
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
SOCIETE GENERALE
Societe Generale
1221 Avenue of the Americas
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
NATEXIS BANQUES POPULAIRES, NEW YORK BRANCH
Natexis Banques Populaires, New York Branch
1251 Avenue of the ▇▇▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
RZB FINANCE LLC
RZB Finance LLC
▇▇▇▇ ▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Schedule 11.02-2
EXHIBIT A
FORM OF NOTICE OF BORROWING
(LETTERS OF CREDIT)
[DATE]
Fortis Capital Corp. BNP Paribas
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇ ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ Attention: ▇▇▇▇▇▇ ▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇ Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Re: Uncommitted Amended and Restated Credit Agreement, dated to be
effective as of July 1, 2002 (as amended or supplemented from
time to time, the "Agreement"), by and among ▇▇▇▇▇▇▇▇
Marketing, L.L.C. (the "Borrower"), the banks that from time
to time are parties thereto, Fortis Capital Corp., as
Administrative Agent, and BNP Paribas, as Documentation Agent
Ladies and Gentlemen:
Reference is made to the Agreement (capitalized terms used
herein that are not defined shall have the respective meanings ascribed thereto
in the Agreement). The Borrower hereby gives notice of its intention to request
the [ISSUANCE, AMENDMENT, OR RENEWAL] of Letters of Credit as is further
described on the Letter of Credit Application attached hereto.
The Borrower represents and warrants, as of the date hereof
and as of the date any Letter of Credit is Issued, amended or renewed, that (i)
no Default or Event of Default has occurred and is continuing on the date
hereof, nor will any thereof occur after giving effect to the Letters of Credit
requested above; (ii) that the Borrowing Base Advance Cap will not be exceeded
after giving effect to the Letters of Credit requested above; and (iii) all of
Borrower's representations and warranties under the Agreement are true and
correct, to Borrower's knowledge, as of the date hereof.
Very truly yours,
▇▇▇▇▇▇▇▇ MARKETING, L.L.C.,
By: ________________________________
Name: __________________________
Title: _________________________
A-1
FORM OF NOTICE OF BORROWING
(REVOLVING LOAN)
[DATE]
Fortis Capital Corp.
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Re: Uncommitted Amended and Restated Credit Agreement, dated to be
effective as of July 1, 2002 (as amended or supplemented from
time to time, the "Agreement"), by and among ▇▇▇▇▇▇▇▇
Marketing, L.L.C. (the "Borrower"), the banks that from time
to time are parties thereto, Fortis Capital Corp., as
Administrative Agent, and BNP Paribas, as Documentation Agent
Ladies and Gentlemen:
Reference is made to the Agreement (capitalized terms used
herein that are not defined shall have the respective meanings ascribed thereto
in the Agreement). The Borrower hereby gives notice of its intention to borrow
under the Borrowing Base Line.
Please advance a Revolving Loan as follows:
Date of Borrowing (a-1) : ______________________________
Amount : ______________________________
Type of Advance
(Base Rate or Offshore Rate) : ______________________________
Interest Period
(if Offshore Rate) : ______________________________
The Borrower represents and warrants, as of the date hereof
and as of the date any Revolving Loan is made or renewed, that (i) no Default or
Event of Default has occurred and is continuing on the date hereof, nor will any
thereof occur after giving effect to the Revolving
_____________________
(a-1) The aggregate amount of the Borrowing comprised of Offshore Rate Loans
must be made in an amount equal to the Offshore Effective Amount. The date of
the Borrowing must be a Business Day. Borrower must give four (4) Business Days
advance notice for Borrowings comprised of Offshore Rate Loans, and the same
Business Day advance notice for Borrowings comprised of Base Rate Loans.
A-2
Loan requested above; (ii) that neither the Borrowing Base Advance Cap nor the
Dollar Advance Cap will be exceeded after giving effect to the Revolving Loan
requested above; and (iii) all of Borrower's representations and warranties
under the Agreement are true and correct, to Borrower's knowledge, as of the
date hereof.
Very truly yours,
▇▇▇▇▇▇▇▇ MARKETING, L.L.C.,
By: ______________________________
Name: ________________________
Title: _______________________
A-3
EXHIBIT B
FORM OF
NOTICE OF CONVERSION/CONTINUATION
[Date]
Fortis Capital Corp.
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Re: Uncommitted Amended and Restated Credit Agreement, dated to be
effective as of July 1, 2002 (as amended or supplemented from
time to time, the "Agreement"), by and among ▇▇▇▇▇▇▇▇
Marketing, L.L.C. (the "Borrower"), the banks that from time
to time are parties thereto, Fortis Capital Corp., as
Administrative Agent, and BNP Paribas, as Documentation Agent
Ladies and Gentlemen:
The Borrower hereby gives you irrevocable notice pursuant to
Section 2.04 of the Agreement that the undersigned hereby requests a
[conversion] [continuation] of [outstanding Borrowings] [an outstanding
Borrowing] into a new Borrowing (the "Proposed Borrowing") on the terms set
forth below:
Outstanding Borrowing #1
Date of Borrowing :
Aggregate Amount for Conversion(2) :
Type of Advance :
Interest Period :
Proposed Borrowing
_________________________
(2) The aggregate amount for conversion with respect to Borrowings
comprised of Offshore Rate Loans must be made in an amount equal to the Offshore
Effective Amount or, if the remaining outstanding amount of such Borrowing would
be less than an amount equal to the Offshore Effective Amount following the
conversion or continuation, in the remaining outstanding amount of such
Borrowing.
B-1
Date of Conversion or Continuation(3) :
Aggregate Amount :
Type of Advance :
Interest Period :
The undersigned hereby certifies that the following statements
are true on the date hereof, and will be true on the date of the proposed
Borrowing:
(a) the representations and warranties contained in the
Agreement are correct in all material respects, before and after giving effect
to the proposed Borrowing and the application of the proceeds therefrom, as
though made on the date of the proposed Borrowing;
(b) no Default has occurred and remains uncured, nor would
result from the proposed Borrowing; and
(c) the Borrowing Base Advance Cap will not be exceeded after
giving effect to the proposed Borrowing.
Very truly yours,
▇▇▇▇▇▇▇▇ MARKETING, L.L.C.,
By: ______________________________
Name: ________________________
Title: _______________________
______________________
(3) The date of the proposed conversion or continuation must be a Business
Day. Borrower must give four (4) Business Days advance notice for conversions
into or continuations of Borrowings comprised of Offshore Rate Loans, and the
same Business Day advance notice for conversions into or continuations of
Borrowings comprised of Base Rate Loans.
B-2
EXHIBIT C
FORM OF
COMPLIANCE CERTIFICATE
[Date]
Fortis Capital Corp. BNP Paribas
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇ ▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ Attention: ▇▇▇▇▇▇ ▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇ Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Re: Uncommitted Amended and Restated Credit Agreement, dated to be
effective as of July 1, 2002 (as amended or supplemented from
time to time, the "Agreement"), by and among ▇▇▇▇▇▇▇▇
Marketing, L.L.C. (the "Borrower"), the banks that from time
to time are parties thereto, Fortis Capital Corp., as
Administrative Agent, and BNP Paribas, as Documentation Agent
Ladies and Gentlemen:
The Borrower, acting through its duly authorized Responsible
Officers (as that term is defined in the Agreement), certifies to each of the
Banks that the Borrower is in compliance with the Agreement and in particular
certifies the following as of ____________:
(i) Net Working Capital $ ;
----------------
(ii) Tangible Net Worth $ ;
----------------
(iii) Ratio of Total Liabilities to Tangible
Net Worth :1;
-----------------
(iv) Borrowing Base Sub-Cap $ .
----------------
Further, the undersigned hereby certify that the Net Position
has at no time exceeded the limitations set forth in Section 8.11 of the
Agreement and that the undersigned has no knowledge of any Defaults under the
Agreement which existed as of [______________] or which exist as of the date of
this letter.
The undersigned also certifies that the accompanying financial
statements present fairly, in all material respects, the financial condition of
the Borrower as of [_____________], and the related results of operations for
the [___________] then ended, in conformity with generally accepted accounting
principles.
C-1
Very truly yours,
▇▇▇▇▇▇▇▇ MARKETING, L.L.C.
By: _________________________________
Name: ___________________________
Title: __________________________
C-2
EXHIBIT D
FORM OF
ASSIGNMENT AND ACCEPTANCE
[Date]
Reference is made to the Uncommitted Amended and Restated
Credit Agreement dated to be effective as of July 1, 2002 (as amended or
supplemented from time to time, the "Agreement"), among ▇▇▇▇▇▇▇▇ MARKETING,
L.L.C. (the "Borrower"), the banks that from time to time are signatories
thereto, and Fortis Capital Corp., as Administrative Agent. Capitalized terms
used herein but not defined herein shall have the meanings specified in the
Agreement.
Pursuant to the terms of the Agreement, [_________________]
("Assignor"), wishes to assign and delegate to [________________] ("Assignee"),
[_______]% of its rights and obligations under the Agreement. Therefore,
Assignor, Assignee, and Administrative Agent agree as follows:
1. The Assignor hereby sells and assigns and delegates to the
Assignee, and the Assignee hereby purchases and assumes from the Assignor,
without recourse to the Assignor and without representation or warranty except
for the representations and warranties specifically set forth in clauses (i),
(ii), and (iii) of Section 2 of this Assignment and Acceptance, a [_____]%
interest in and to all of the Assignor's rights and obligations under the
Agreement and the other Loan Documents as of the Effective Date (as defined
below), including such percentage interest in the Assignor's Uncommitted Line
Portion, the Loans owing to the Assignor, the Assignor's Pro Rata Share of the
Letters of Credit, and the Note held by the Assignor.
2. The Assignor (i) represents and warrants that, prior to
executing this Assignment and Acceptance, its Uncommitted Line Portion is
$[________________], the aggregate outstanding principal amount of Loans owed by
the Borrower to the Assignor is $[______________], and its Pro Rata Share of the
outstanding Effective Amount of L/C Obligations is $[_____________]; (ii)
represents and warrants that it is the legal and beneficial owner of the
interest being assigned by it hereunder and that such interest is free and clear
of any adverse claim; (iii) makes no representation or warranty and assumes no
responsibility with respect to any statements, warranties, or representations
made in or in connection with the Agreement or any other Loan Document or the
execution, legality, validity, enforceability, genuineness, sufficiency, or
value of the Agreement or any other Loan Document or any other instrument or
document furnished pursuant thereto; (iv) makes no representation or warranty
and assumes no responsibility with respect to the financial condition of the
Borrower or the performance or observance by the Borrower of any of its
obligations under the Agreement or any other Loan Document or any other
instrument or document furnished pursuant thereto; and (v) attaches the Note
referred to in Section 1 above and requests that Administrative Agent exchange
such Note for a new Note dated [____________], in the principal amount of
$[_____________] payable to the order of the Assignee[, and a new Note dated in
the principal amount of $[______________] payable to the order of Assignor].
D-1
3. The Assignee (i) confirms that it has received a copy of
the Agreement, together with copies of the financial statements referred to in
Section 7.01 thereof and such other documents and information as it has deemed
appropriate to make its own credit analysis and decision to enter into this
Assignment and Acceptance (ii) agrees that it will, independently and without
reliance upon Administrative Agent, the Assignor or any other Bank, and based on
such documents and information as it shall deem appropriate at the time,
continue to make its own credit decisions in taking or not taking action under
the Agreement or any other Loan Document; (iii) appoints and authorizes
Administrative Agent to take such action as agent on its behalf and to exercise
such powers under the Agreement and any other Loan Document as are delegated to
Administrative Agent by the terms thereof, together with such powers as are
reasonably incidental thereto; (iv) agrees that it will perform in accordance
with their terms all of the obligations which by the terms of the Agreement or
any other Loan Document are required to be performed by it as a Bank; (v)
specifies as its Lending Office (and address for notices) the office set forth
beneath its name on the signature pages hereof; (vi) attaches the forms
prescribed by the Internal Revenue Service of the United States certifying as to
the Assignee's status for purposes of determining exemption from United States
withholding taxes with respect to all payments to be made to the Assignee under
the Agreement and Notes or such other documents as are necessary to indicate
that all such payments are subject to such rates at a rate reduced by an
applicable tax treaty, and (vii) represents that it is an Eligible Assignee.
4. The effective date for this Assignment and Acceptance shall
be [___________________] ("Effective Date"), and following the execution of this
Assignment and Acceptance, Administrative Agent will record it in its records of
the transactions under the Agreement.
5. Upon such recording, from and after the Effective Date,
Administrative Agent shall make all payments under the Agreement and the Notes
in respect of the interest assigned hereby (including all payments of principal,
interest, and fees) to the Assignee. The Assignor and Assignee shall make all
appropriate adjustments in payments under the Agreement and the Notes for
periods prior to the Effective Date directly between themselves.
6. This Assignment and Acceptance shall be governed by, and
construed and enforced in accordance with, the laws of the State of New York.
The parties hereto have caused this Assignment and Acceptance
to be duly executed as of the date first above written.
D-2
[ASSIGNOR]
By:____________________________________
Name:__________________________________
Title:_________________________________
Address:_______________________________
_______________________________________
_______________________________________
Attention:_____________________________
Telecopy No:___________________________
[ASSIGNEE]
By:____________________________________
Name:__________________________________
Title:_________________________________
Lending Office:
Address:_______________________________
_______________________________________
_______________________________________
Attention:_____________________________
Telecopy No:___________________________
FORTIS CAPITAL CORP., as Administrative Agent
By:____________________________________
Name:__________________________________
Title:_________________________________
D-3
EXHIBIT E
FORM OF
BORROWING BASE COLLATERAL POSITION REPORT
[Date]
Fortis Capital Corp. BNP Paribas
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇ ▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ Attention: ▇▇▇▇▇▇ ▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇ Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Re: Uncommitted Amended and Restated Credit Agreement, dated to be
effective as of July 1, 2002 (as amended or supplemented from
time to time, the "Agreement"), by and among ▇▇▇▇▇▇▇▇
Marketing, L.L.C. (the "Borrower"), the banks that from time
to time are parties thereto, Fortis Capital Corp., as
Administrative Agent, and BNP Paribas, as Documentation Agent
Ladies and Gentlemen:
The Borrower, acting through its duly authorized Responsible
Officer (as that term is defined in the Agreement), deliver the attached report
to the Banks and certify to each of the Banks that it is in compliance with the
Agreement. Further, the undersigned hereby certifies that the Net Position has
at no time exceeded the limitations set forth in Section 8.11 of the Agreement
and that the undersigned has no knowledge of any Defaults or Events of Default
under the Agreement which exist as of the date of this letter.
The undersigned also certifies that the amounts set forth on
the attached report constitute all Collateral which has been or is being used in
determining availability for an advance or letter of credit issued under the
Borrowing Base Line as of the preceding date.
This certificate and attached reports are submitted pursuant
to Section 7.02(b) of the Agreement. Capitalized terms used herein and in the
attached reports have the meanings specified in the Agreement.
Very truly yours,
▇▇▇▇▇▇▇▇ MARKETING, L.L.C.,
By:
----------------------------
Name:
----------------------------
Title:
----------------------------
E-1
▇▇▇▇▇▇▇▇ MARKETING, L.L.C.,
BORROWING BASE COLLATERAL POSITION REPORT
AS OF [DATE]
In my capacity as Responsible Officer for ▇▇▇▇▇▇▇▇ Marketing,
L.L.C., I hereby certify that as of the date written above, the amounts
indicated below were accurate and true as of the date of preparation. I also
certify that the net long or short position has not exceeded the limitations set
forth in Section 8.11 of the Credit Agreement.
I. COLLATERAL
A. Cash Collateral $______ 100% $______
B. Equity in Eligible Broker
accounts $______ 90% $______
C. Tier I Accounts $______ 90% $______
D. Tier II Accounts $______ 85% $______
E. Tier I Unbilled Accounts $______ 85% $______
F. Tier II Unbilled Accounts $______ 80% $______
G. Eligible Inventory $______ 80% $______
H. Eligible Exchange Receivables $______ 80% $______
I. Undelivered Product Value $______ 80% $______
J. Realizable Unrealized Profits, up to a maximum
amount of $50,000,000; less $______ 70% $______
K. First purchaser liability; less $(_____) 100% $(_____)
L. ▇▇▇▇-to-Market amounts owed under Commodity Swap
Contracts to BNP Paribas; less $(_____) 125% $(_____)
M. Unrealized ▇▇▇▇-to-Market Losses $(_____) 100% $(_____)
TOTAL COLLATERAL $
=========== === ============
BORROWING BASE SUB-CAP $
----------- ---
------------
BORROWING BASE ADVANCE CAP $
------------
------------
------------
II. BANK OUTSTANDINGS $
------------
A. Loans from the Banks $
------------
B. L/C's from the Banks $
------------
------------
TOTAL OUTSTANDINGS UNDER BORROWING BASE LINE
------------
III. EXCESS/(DEFICIT) (I-II)
------------
IV. NET SHORT OR LONG POSITION ___________ MMBTUS $
------------
Attached hereto are (i) an aging report, (ii) a schedule of netted qualified
exchange balances, (iii) a schedule of qualified inventory and (iv) a schedule
of all contras applied against (i), (ii), and (iii).
E-2
By: ____________________________________
Responsible Officer
E-3
EXHIBIT F
FORM OF NET POSITION REPORT AND EXPOSURE REPORT
[Date]
Fortis Capital Corp. BNP Paribas
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇ ▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ Attention: ▇▇▇▇▇▇ ▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇ Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Re: Net Positions
In my capacity as Responsible Officer of ▇▇▇▇▇▇▇▇ Marketing,
L.L.C., I hereby certify to you that as of the date written above, such
company's aggregate net positions are as follows:
MMBTUS of
Natural Gas
-----------
Long _____
(Short) _____
Net Position _____
To the best of my knowledge, these net positions have at no
time exceeded the limitations set forth in Section 8.11 of that certain
Uncommitted Amended and Restated Credit Agreement, dated to be effective as of
July 1, 2002, as amended or supplemented from time to time, by and among
▇▇▇▇▇▇▇▇ Marketing, L.L.C., the banks that from time to time are parties
thereto, Fortis Capital Corp., as Administrative Agent, and BNP Paribas, as
Documentation Agent.
Furthermore, at no time has the sum of the following:
(a) 25% of the Borrower's Net Position Value, $_____________, plus
(b) Borrower's Transportation and Storage
Exposure, $_____________, plus
(c) Borrower's Below Index Sales Exposure, $_____________
exceeded 33% of Borrower's Net Working Capital,
where,
F-1
"Net Position Value" means Borrower's Net Position valued at
$3.00/MMBTU.
"Below Index Sales Exposure" means (the maximum volume of gas
required to be sold at below index prices multiplied by the discount from
index), minus (the net positive value of all hedge contracts related to the
utilization of the related storage & transportation assets).
"Transportation and Storage Exposure" means the aggregate
contractual cost of transportation & storage contracts for a term of in excess
of 3 months.
Very truly yours,
▇▇▇▇▇▇▇▇ MARKETING, L.L.C.,
By: __________________________________
Name: ____________________________
Title: ___________________________
Date:_______
F-2
EXHIBIT G
SUBORDINATION AGREEMENT
THIS SUBORDINATION AGREEMENT (this "Agreement") is made as of
the _____ day of __________, 2002, by and between FORTIS CAPITAL CORP. a
Connecticut Corporation ("Administrative Agent"), as Administrative Agent for
the ratable benefit of the Banks (hereinafter defined),
___________________________ (the Subordinated Creditor") and acknowledged by
▇▇▇▇▇▇▇▇ MARKETING, L.L.C., a Delaware limited liability company ("Borrower").
RECITALS
WHEREAS, Administrative Agent and the Banks have made, or in
the future may make, credit accommodations available to Borrower, pursuant to
the terms and provisions of that certain Uncommitted Amended and Restated Credit
Agreement dated to be effective as of July 1, 2002 ("Credit Agreement") among
Administrative Agent, the Borrower and the banks and financial institutions from
time to time party thereto (collectively, the "Banks"); and
WHEREAS, Subordinated Creditor has made, or in the future may
make, credit accommodations available to Borrower; and
WHEREAS, in order to induce Administrative Agent to consider
making the credit accommodations described above available to Borrower in the
future, Subordinated Creditor has agreed to subordinate certain of its rights
and claims now existing or hereafter arising against Borrower to the rights and
claims of Administrative Agent now existing or hereafter arising against
Borrower, all in accordance with the terms and provisions of this Agreement; and
WHEREAS, the parties hereto are entering into this Agreement
in order to set forth their agreements as to payment of the Senior Indebtedness
(hereinafter defined) and the Junior Indebtedness (hereinafter defined) and
their agreements as to certain other matters including but not limited to lien
priorities.
NOW, THEREFORE, for and in consideration of the premises and
the mutual agreements contained herein, the parties hereto hereby agree as
follows:
AGREEMENT
ARTICLE I DEFINITIONS
As used in this Agreement, the terms defined above shall have
their respective meanings set forth above and the following terms shall have the
following meanings:
"Collateral" shall mean any and all property which now
constitutes or hereafter will constitute collateral or other security for
payment of the Senior Indebtedness pursuant to the Senior Documents or
otherwise.
G-1
"Default" shall have the meaning set forth in the Credit
Agreement.
"Distribution" by any Person shall mean (a) with respect to
any stock issued by such Person, the retirement, redemption, purchase or other
acquisition for value of any such stock, (b) the declaration or payment of any
dividend or other distribution on or with respect to any such stock, (c) any
loan or advance by such Person to, or other investment by such Person in, the
holder of any such stock, and (d) any other payment (other than ordinary
salaries to employees or advances made in the ordinary course of business to
employees for travel or other expenses incurred in the ordinary course of
business) by such Person to or for the benefit of the holder of any such stock.
"Event of Default" shall have the meaning set forth in the
Credit Agreement.
"Federal Bankruptcy Code" shall have the meaning set forth in
Article VIII of this Agreement.
"Junior Creditor" shall mean the Subordinated Creditor and its
successors and assigns.
"Junior Documents" shall mean any and all agreements,
documents and instruments evidencing, governing or executed or delivered in
connection with the Junior Indebtedness.
"Junior Indebtedness" shall mean any and all indebtedness,
obligations and liabilities of every kind and character of Borrower now or
hereafter owing to any party to this Agreement other than Senior Creditor,
including, without limitation, the indebtedness evidenced and to be evidenced by
the Junior Documents, whether such indebtedness, obligations and liabilities are
direct or indirect, primary or secondary, joint, several or joint and several,
fixed or contingent and whether incurred by Borrower as maker, endorser,
guarantor or otherwise.
"Permitted Payments shall have the meaning set forth in
Article IV of this Agreement.
"Person" shall mean and include an individual, a partnership,
a corporation, a business trust, a joint stock company, a trust, an
unincorporated association, a joint venture or other entity or a governmental
authority.
"Proceeds" shall have the meaning assigned to it under the
Uniform Commercial Code, shall also include "products" (as defined in the
Uniform Commercial Code), and, in any event, shall include, but not be limited
to (a) any and all proceeds of any insurance, indemnity, warranty, letter of
credit or guaranty or collateral security payable to any grantor from time to
time with respect to any of the Collateral, (b) any and all payments (in any
form whatsoever) made or due and payable to the owner of the Collateral from
time to time in connection with any requisition, confiscation, condemnation,
seizure or forfeiture of all or any part of the Collateral by any governmental
body, authority, bureau or agency (or any Person acting under color of
governmental authority) and (c) any and all other amounts from time to time paid
or payable under or in connection with any of the Collateral.
G-2
"Senior Creditor" shall mean Administrative Agent and its
successors and assigns.
"Senior Documents" shall mean any and all agreements,
documents and instruments evidencing, governing or executed or delivered in
connection with the Senior Indebtedness or the Senior Creditor's interests in
the Collateral, including, without limitation, the Credit Agreement.
"Senior Indebtedness" shall mean any and all indebtedness,
obligations and liabilities of every kind and character of Borrower now or
hereafter owing to Senior Creditor, whether such indebtedness, obligations and
liabilities are direct or indirect, primary or secondary, joint, several or
joint and several, fixed or contingent and whether incurred by Borrower as
maker, endorser, guarantor or otherwise, including, without limitation, any and
all indebtedness, obligations and liabilities of Borrower now or hereafter owing
to Senior Creditor pursuant to or evidenced by the Senior Documents.
ARTICLE II RIGHTS IN COLLATERAL
2.1 Priorities Regarding Collateral. The Junior Creditor
covenants and agrees that it will not take or hold any liens or security
interests on any property of Borrower. If for any reason, however, the Junior
Creditor does obtain a lien or security interest in the Collateral, any and
every lien and security interest in the Collateral in favor of or held for the
benefit of the Senior Creditor has and shall have priority over any lien or
security interest that Junior Creditor has or might have or acquire in the
Collateral notwithstanding any statement or provision contained in the Junior
Documents or otherwise to the contrary and irrespective of the time or order of
filing or recording of financing statements, deeds of trust, mortgages or other
notices of security interests, liens or assignments granted pursuant thereto,
and irrespective of anything contained in any filing or agreement to which any
party hereto or its respective successors and assigns may now or hereafter be a
party, and irrespective of the ordinary rules for determining priorities under
the Uniform Commercial Code or under any other law governing the relative
priorities of secured creditors.
2.2 Management of Collateral. Senior Creditor shall have the
exclusive right to manage, perform and enforce the terms of the Senior Documents
with respect to the Collateral, to exercise and enforce all privileges and
rights thereunder according to its discretion and the exercise of its business
judgment including, but not limited to, the exclusive right to take or retake
possession of the Collateral and to hold, prepare for sale, process, sell,
lease, dispose of, or liquidate the Collateral, pursuant to a foreclosure or
otherwise. Notwithstanding any rights or remedies available to the Junior
Creditor under applicable law or under any document or instrument evidencing,
securing or otherwise executed in connection with the incurrence of the
obligations contemplated by the Junior Documents, Junior Creditor shall not be
permitted to foreclose upon its security interest in any of the Collateral, or
to exercise similar remedies with respect thereto, so long as any of the Senior
Indebtedness shall continue to exist, and only the Senior Creditor shall have
the right to restrict or permit, or approve or disapprove, the sale, transfer or
other disposition of Collateral. Junior Creditor will not in any manner
interfere with Senior Creditor's security interests in the Collateral unless and
until Borrower has satisfied in full the Senior Indebtedness and Senior Creditor
has given Junior Creditor written notice thereof.
G-3
The Junior Creditor waives notice of, and agrees not to challenge the method,
manner, time, place or terms, of any disposition of the Collateral by Senior
Creditor. Accordingly, should Senior Creditor elect to exercise its rights and
remedies with respect to any of the Collateral, Senior Creditor may proceed to
do so without regard to any interest of the Junior Creditor, and the Junior
Creditor waives any claims that it may have against Senior Creditor for any
disposition of the Collateral. The Junior Creditor agrees, whether or not a
default has occurred in the payment of any indebtedness or the performance of
any other obligations to it, that any liens on and security interests in the
Collateral or any portion thereof that it might have or acquire shall
automatically be fully released ipso facto as to all indebtedness and other
obligations secured thereby owing to Junior Creditor if and when Senior Creditor
releases its lien in and security interest on such Collateral in the event of
any sale, disposition or other realization by Senior Creditor (or any agent
therefor) upon such Collateral.
ARTICLE III PROCEEDS
3.1 Distribution of Proceeds of Collateral. At any time during
which all or any part of the Senior Indebtedness remains outstanding, and
whether or not the same is then due and payable, the Proceeds of any sale,
disposition or other realization by Senior Creditor (or any agent therefor) upon
all or any part of the Collateral shall be applied first to the payment in full
of all Senior Indebtedness in such order as Senior Creditor shall determine in
its sole discretion.
3.2 Contingent Obligations. For purposes of distributing the
Proceeds of Collateral pursuant to this Article III, the portion of Senior
Indebtedness consisting of loans or advances not yet made by Senior Creditor to
Borrower under the Senior Documents (including, but not limited to, amounts with
respect to letters of credit outstanding and reimbursement for fees, costs and
expenses) shall be considered Senior Indebtedness then outstanding, and the
Senior Creditor shall have the right to retain, in a cash collateral account,
cash collateral equal to the amount thereof which Senior Creditor determines, in
its sole good faith discretion, may arise or exist from time to time.
3.3 Holding of Proceeds in Trust. Except as provided for in
Article IV of this Agreement, in the event the Junior Creditor receives Proceeds
of the Collateral, Junior Creditor shall be deemed to hold all of such Proceeds
in trust for the benefit of Senior Creditor until the proper application thereof
in accordance with Section 3.1 hereof. The Junior Creditor shall not seek to
challenge the validity, enforceability, priority or perfection of any of the
Senior Documents if the purpose or effect thereof would in any manner defeat or
delay the distribution of the Proceeds of any Collateral in the manner set forth
in Section 3.1 hereof.
ARTICLE IV SUBORDINATION
The Junior Creditor covenants and agrees that the Junior
Indebtedness, howsoever evidenced and whether now existing or hereafter
incurred, shall be subordinate and junior in right of payment, to the extent and
in the manner hereinafter set forth, to all Senior Indebtedness:
(a) The holder of the Senior Indebtedness shall first be
finally and irrevocably paid in cash an aggregate amount equal to the principal
thereof and termination fees, if any, interest at the time due thereon, and all
other costs, fees, expenses and/or obligations now or
G-4
hereafter owing thereunder, before any payment or Distribution of any character,
whether in cash, securities or other property, shall be made on account of the
Junior Indebtedness or otherwise to or for the benefit of Junior Creditor; and
any payment or Distribution of any character, whether in cash, securities or
other property, which would otherwise, but for the provisions of this Article
IV, be payable or deliverable in respect of the Junior Indebtedness or otherwise
shall be paid or delivered directly to the holder of the Senior Indebtedness (or
its duly authorized representatives), until all the Senior Indebtedness shall
have been paid in full.
(b) Notwithstanding the provisions of subparagraph (a) of this
Article IV, Borrower may (i) pay interest on the unpaid principal balance of the
Junior Indebtedness on a monthly basis in arrears and make both scheduled
payments and prepayments of principal on the terms and conditions set forth in
the Junior Documents and (ii) make Distributions to Atmos Energy Marketing, LLC,
a Delaware limited liability company (the "Permitted Payments"); provided,
however, that as a condition precedent to Borrower's right to make (and the
Junior Creditor's rights to receive) any and all such Permitted Payments, there
shall not have occurred or then exist a Default or Event of Default under any of
the Senior Indebtedness or any of the Senior Documents, or an event or condition
which with notice, lapse of time or the making of such payment or Distribution
would constitute a Default or Event of Default under any of the foregoing.
(c) The Junior Creditor agrees to promptly notify the Senior
Creditor in writing of any default or event of default on any Junior
Indebtedness or otherwise or under any of the Junior Documents and further
agrees not to exercise any right or remedy or take any enforcement action with
respect to any default or event of default on any of the Junior Indebtedness or
otherwise or under any of the Junior Documents until such time as the Senior
Indebtedness has been paid in full. Without limiting any of the foregoing, any
failure of Borrower to perform any of its obligations to Junior Creditor as a
result of any of the prohibitions, restrictions or limitations set forth in this
Agreement shall not constitute the basis for a default or event of default on
any Junior Indebtedness or under any Junior Documents.
(d) No reimbursement, payment, direct or indirect, or
disbursement of other property or assets of Borrower shall be made by Borrower
on account of the Junior Indebtedness or otherwise or received, accepted,
retained or applied by the Junior Creditor (except for the account and benefit
of Senior Creditor, which shall be held in trust for Senior Creditor or except
for Permitted Payments as allowed in subparagraph (b) of this Article IV) until
such time as the Senior Indebtedness has been finally and irrevocably paid in
full in cash.
(e) Without affecting Junior Creditor's obligations set forth
in this Agreement not to exercise any remedy as set forth in this Agreement, in
the event that the Junior Creditor receives any payment of any character,
whether in cash, securities, or other properties, payable or deliverable in
respect of the Junior Indebtedness and (i) such payment would cause an event or
condition to occur which, with notice, lapse of time, or both, would cause a
Default or an Event of Default to occur under the Senior Documents; or (ii) such
payment is made after a Default or an Event of Default has occurred under the
Senior Documents; or (iii) such payment is made at a time that the management of
Borrower knew or reasonably should have known that a Default or an Event of
Default had occurred under the Senior Documents, or that such payment could
reasonably be expected to cause a Default or an Event of Default to occur under
the Senior
G-5
Documents, then such cash, securities or other properties shall be held in trust
for the benefit of the holder of the Senior Indebtedness and shall be paid or
delivered to the holder of the Senior Indebtedness (or its authorized
representatives), in the proportions in which it holds same, until all the
Senior Indebtedness shall have been paid in full.
(f) The provisions of this Agreement are and are intended
solely for the purpose of defining the relative rights of the holder of the
Junior Indebtedness, on the one hand, and the holder of the Senior Indebtedness
on the other hand. Nothing contained in this Agreement is intended to or shall
impair, as between Borrower and its creditors other than the holder of the
Senior Indebtedness and the holder of the Junior Indebtedness, the obligations
of Borrower which are absolute and unconditional, to pay to the holder of the
Junior Indebtedness the principal thereof and interest thereon as and when the
same shall become due and payable in accordance with its terms, or is intended
to or shall affect the relative rights against Borrower of the holder of the
Senior Indebtedness.
(g) No right of any present or future holder of any of the
Senior Indebtedness to enforce the subordination as herein provided shall at any
time in any way be prejudiced or impaired by any act or failure to act on the
part of Borrower or by any act in good faith or failure to act in good faith by
any such holder, or by any noncompliance by Borrower with the covenants,
agreements and conditions of the Junior Indebtedness, regardless of any
knowledge thereof any such holder may have or be otherwise charged with.
(h) Senior Creditor shall have no obligation to preserve the
rights of the Collateral against any prior parties or to marshal any of the
Collateral for the benefit of any Person.
ARTICLE V BENEFIT OF AGREEMENT; AMENDMENT
This Agreement shall constitute a continuing offer to all
persons who, in reliance upon such provisions, become a Senior Creditor, and
such provisions are made for the benefit of each Senior Creditor and each of
them may enforce such provisions. The Junior Creditor agrees not to assign or
transfer, at any time this Agreement remains in effect, any rights, claim or
interest of any kind in or to any Junior Indebtedness without first notifying
Senior Creditor and making such assignment expressly subject to this Agreement.
The provisions of the Junior Documents as in effect on the date hereof may not
be amended or modified in any respect without the prior written consent of
Senior Creditor.
ARTICLE VI FURTHER ASSURANCES
Each of the parties hereto hereby agrees to promptly execute and deliver to the
other parties hereto any and all such further instruments and documents and take
such further action as such other parties may reasonably request in order to
fully effect the purposes of this Agreement.
ARTICLE VII REPRESENTATIONS AND WARRANTIES
7.1 Senior Creditor and Junior Creditor. Each of the parties
hereto hereby represents and warrants to the other party hereto that:
G-6
(a) such party has full power, authority and legal right to
execute, deliver and perform this Agreement, and has taken all necessary
corporate action to authorize the execution, delivery and performance of this
Agreement; and
(b) this Agreement constitutes a legal, valid and binding
obligation of such party enforceable against it in accordance with its terms
except as enforceability may be limited by applicable bankruptcy, insolvency,
moratorium or other similar laws affecting creditors rights generally and except
as enforceability may be limited by general principles of equity (whether
considered in a suit at law or in equity).
ARTICLE VIII BANKRUPTCY
The Junior Creditor agrees not to commence, or to join with
any other creditor in commencing, any case under Title 11 of the United States
Code, as amended and/or superseded (the "Federal Bankruptcy Code") by or against
Borrower or any of its property without the prior written consent of Senior
Creditor. The provisions of this Agreement shall continue in full force and
effect, notwithstanding the commencement of a case under the Federal Bankruptcy
Code by or against Borrower. In furtherance of the foregoing, if Junior Creditor
receives any property of, or payments from Borrower after the commencement of
such a case on account of a secured claim which is subordinated by the terms of
this Agreement (whether as "adequate protection" payments or otherwise), Junior
Creditor shall immediately turn such property or payments over to the Senior
Creditor. To the extent that Junior Creditor has or acquires any rights under
Section 363 or Section 364 of the Federal Bankruptcy Code with respect to the
Collateral, the Junior Creditor hereby agrees not to assert such rights without
the prior written consent of the Senior Creditor. The Junior Creditor hereby
grants to the Senior Creditor the right, but Senior Creditor shall not be
obligated, to file, prove and vote claims on account of the Junior Indebtedness
in any receivership, bankruptcy, or other proceeding under the Federal
Bankruptcy Code commenced by or against Borrower.
ARTICLE IX MISCELLANEOUS
9.1 No Waiver, Cumulative Remedies. No failure to exercise,
and no delay in exercising on the part of any party hereto, any right, power or
privilege under this Agreement shall operate as a waiver thereof; nor shall any
single or partial exercise of any right, power or privilege under this Agreement
preclude any other or further exercise thereof or the exercise of any other
right, power or privilege. The rights and remedies provided in this Agreement
are cumulative and shall not be exclusive of any rights or remedies provided by
law.
9.2 Notices. All notices, requests and demands to or upon the
respective parties hereto to be effective shall be in writing (including by
telegraph, telecopier, or telex) and, unless otherwise expressly provided
herein, shall be deemed to have been duly given or made when delivered by hand,
or five days after being deposited in the mail, postage prepaid, or, in the case
of telegraphic notice, when delivered to the telegraph company, or in the case
of telex notice, when sent, answer back received, addressed as set forth below
or to such address or other address as may be hereafter notified by the
respective parties hereto:
G-7
To Senior Creditor: Fortis Capital Corp.
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
To Junior Creditor: ______________________________
______________________________
______________________________
Attention: ___________________
Telephone: ___________________
Facsimile: ___________________
9.3 GOVERNING LAW. THIS AGREEMENT SHALL BE INTERPRETED AND THE
RIGHTS AND OBLIGATIONS OF THE PARTIES UNDER THIS AGREEMENT SHALL BE GOVERNED BY,
AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE INTERNAL LAWS OF THE STATE
OF NEW YORK AND SHALL BE BINDING UPON AND INURE TO THE BENEFIT OF THE PARTIES
HERETO AND THEIR RESPECTIVE SUCCESSORS, TRANSFEREES AND ASSIGNS.
9.4 Amendments and Waivers. Neither this Agreement nor any of
the terms hereof may be amended, waived, discharged or terminated unless such
amendment, waiver, discharge or termination is in writing signed by each of the
parties hereto.
9.5 Exculpation. Neither the Senior Creditor nor its agents
have made to the other parties hereto nor do any of them hereby or otherwise
make any representations or warranties, express or implied, nor do they assume
any liability with respect to (i) obligors under any instruments of guarantee;
(ii) the enforceability, validity, value or collectibility of the Senior
Indebtedness, any Collateral therefor, or any guarantee or security which may
have been granted to any of them in connection with the Senior Documents; or
(iii) Borrower's title or right to transfer any collateral or security. No party
hereto shall be liable to any other party hereto for any action or failure to
act or any error of judgment, negligence, or mistake or oversight whatsoever on
its part or its respective agents, officers, employees or attorneys with respect
to any transaction relating to the Collateral or this Agreement. To the maximum
extent permitted by law, except as otherwise provided herein, the Junior
Creditor waives any claim it might have against Senior Creditor with respect to,
or arising out of, the handling of the Collateral (including, without
limitation, any such claim based upon the timing or method of realizing upon
such Collateral).
9.6 Third Party Rights. This Agreement is solely for the
benefit of the parties hereto and their respective successors and assigns, and
no other Person shall have any right, benefit, priority or other interest under,
or because of the existence of, this Agreement.
9.7 Termination. This Agreement shall terminate upon the final
and indefeasible payment in full of all the Senior Indebtedness and the
termination of all of the Senior Documents.
G-8
9.8 Counterparts. This Agreement may be executed by one or
more of the parties hereto in any number of separate counterparts, each of which
shall be an original, but all of which shall constitute but one agreement.
9.9 Legend. All promissory notes issued in connection with the
Junior Indebtedness shall contain a legend substantially in the form of the
following:
"THIS PROMISSORY NOTE, AND PAYMENT AND ENFORCEMENT HEREOF, IS
SUBJECT TO THE TERMS AND PROVISIONS OF THAT CERTAIN
SUBORDINATION AGREEMENT DATED AS OF ________________, 2002
BETWEEN FORTIS CAPITAL CORP., AS ADMINISTRATIVE AGENT, AND
_________________________________ AS SUCH SUBORDINATION
AGREEMENT MAY BE AMENDED FROM TIME TO TIME."
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
[EXECUTION PAGES TO FOLLOW]
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IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed by their proper and duly authorized officers as of
the day and year first above written.
SENIOR CREDITOR:
FORTIS CAPITAL CORP., as Administrative Agent
By: __________________________________
Name: ________________________________
Title: _______________________________
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JUNIOR CREDITOR:
By: __________________________________
Name: ________________________________
Title: _______________________________
G-11
ACKNOWLEDGMENT BY ▇▇▇▇▇▇▇▇ MARKETING, L.L.C.
▇▇▇▇▇▇▇▇ Marketing, L.L.C. hereby acknowledges receipt of a
copy of the foregoing Subordination Agreement and agrees that, except as
otherwise provided by the foregoing Subordination Agreement, it will not pay any
indebtedness subordinated by the foregoing Subordination Agreement until all the
Senior Indebtedness shall have been paid in full.
▇▇▇▇▇▇▇▇ MARKETING, L.L.C.,
a Delaware limited liability company
By: __________________________________
Name: ________________________________
Title: _______________________________
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EXHIBIT H
FORM OF NOTICE OF DISAPPROVAL OF
FURTHER ADVANCES AND LETTERS OF CREDIT
Fortis Capital Corp.
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Re: Uncommitted Amended and Restated Credit Agreement, dated to be
effective as of July 1, 2002 (as amended or supplemented from
time to time, the "Agreement"), by and among ▇▇▇▇▇▇▇▇
Marketing, L.L.C., (the "Borrower"), the banks that from time
to time are parties thereto, Fortis Capital Corp., as
Administrative Agent, and BNP Paribas, as Documentation Agent
Ladies and Gentlemen:
You are hereby notified that the undersigned Bank disapproves
further advances under Article II of the Agreement and further Issuances,
amendments or renewals of Letters of Credit under Article III of the Agreement.
The undersigned acknowledges that one or more Banks may
continue to fund advances and issue Letters of Credit under the Agreement in
which case the Conversion to Reduced Funding Banks Date shall occur. Capitalized
terms used herein and in the attached reports have the meanings specified in the
Agreement.
Very truly yours,
NAME OF BANK
By: ___________________________
Name: _________________________
Title: __________________________
c/c ▇▇▇▇▇▇▇▇ Marketing, L.L.C.
All other Banks
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TABLE OF CONTENTS
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ARTICLE I
DEFINITIONS
1.01 Certain Defined Terms. The following terms have the following meanings:............................. 2
1.02 Other Interpretive Provisions........................................................................ 25
1.03 Accounting Principles................................................................................ 26
ARTICLE II
THE CREDITS
2.01 Amounts and Terms of Uncommitted Line................................................................ 26
2.02 Loan Accounts........................................................................................ 27
2.03 Procedure for Borrowing.............................................................................. 28
2.04 Conversion and Continuation Elections................................................................ 29
2.05 Optional Prepayments The Borrower may, at any time or from time to time, upon the Borrower's
irrevocable written notice to the Administrative Agent received prior to 1:00 p.m. (New York City
time) on the date of prepayment, prepay Loans in whole or in part without premium except any amounts
due by Borrower pursuant to Article IV. The Administrative Agent will promptly notify each Bank of
its receipt of any such prepayment, and of such Bank's Pro Rata Share of such prepayment............. 30
2.06 Mandatory Prepayments of Loans; Mandatory Commitment Reductions. If on any date the Effective
Amount of L/C Obligations exceeds the L/C Cap, the Borrower shall Cash Collateralize on such date
the outstanding Letters of Credit in an amount equal to the excess above any such cap. If on any
date after giving effect to any Cash Collateralization made on such date pursuant to the preceding
sentence, the Effective Amount of all Revolving Loans then outstanding plus the Effective Amount of
all L/C Obligations exceeds the lesser of (a) the Collateral Position or (b) the total Uncommitted
Line, or if the Effective Amount of all Revolving Loans under the Borrowing Base Line then
outstanding, plus the Effective Amount of all L/C Obligations under such Line exceed the Borrowing
Base Advance Cap, the Borrower shall immediately, and without notice or demand, prepay the
outstanding principal amount of the Revolving Loans and L/C Advances by an amount equal to the
applicable excess.................................................................................... 30
2.07 Repayment. The Borrower shall repay the principal amount of each Revolving Loan to the
Administrative Agent on behalf of the Banks, on the Advance Maturity Date for such Loan. All
amounts owing a Swap Bank under any Swap Contract, to the extent such amounts have not been repaid
from the proceeds of a Revolving Loan, shall be paid on demand, or if no demand is made, on the
first (1st) Business Day after the Borrower receives notice that such amount was advanced by or
becomes owing to a Swap Bank......................................................................... 30
2.08 Interest............................................................................................. 30
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2.09 Fees. In addition to certain fees described in Section 3.08, the Borrower shall pay to the
Administrative Agent, for the account of each Bank, fees in accordance with a separate letter
agreement between the Agents, the Banks and the Borrower. The Borrower shall also pay to the
Agents, for their own accounts, fees in accordance with a separate letter agreement between the
Agents and the Borrower............................................................................... 32
2.10 Computation of Fees and Interest...................................................................... 32
2.11 Payments by the Borrower.............................................................................. 32
2.12 Payments by the Banks to the Administrative Agent. If and to the extent any Bank shall not have
made its full amount available to the Administrative Agent in immediately available funds and the
Administrative Agent in such circumstances has made available to the Borrower such amount, that
Bank shall on the Business Day following such Borrowing Date make such amount available to the
Administrative Agent, together with interest at the Federal Funds Rate for each day during such
period. A notice of the Administrative Agent submitted to any Bank with respect to amounts owing
under this Section 2.12 shall be conclusive, absent manifest error. If such amount is so made
available, such payment to the Administrative Agent shall constitute such Bank's Loan on the date
of Borrowing for all purposes of this Agreement. If such amount is not made available to the
Administrative Agent on the Business Day following the Borrowing Date, the Administrative Agent
will notify the Borrower of such failure to fund and, upon demand by the Administrative Agent, the
Borrower shall pay such amount to the Administrative Agent for the Administrative Agent's account,
together with interest thereon for each day elapsed since the date of such Borrowing, at a rate per
annum equal to the interest rate applicable at the time to the Loans comprising such Borrowing........ 33
2.13 Sharing of Payments, Etc. If, other than as expressly provided elsewhere herein, any Bank shall
obtain on account of the Loans made by it any payment (whether voluntary, involuntary, through the
exercise of any right of set-off, or otherwise) in excess of its Pro Rata Share or Adjusted Pro
Rata Share, as the case may be at such time (other than payments to BNP Paribas with respect to
advances made in excess of the Borrowing Base Advance Cap as a result of payment under a Swap
Contract), such Bank shall immediately (a) notify the Administrative Agent of such fact, and (b)
purchase from the other Banks such participations in the Loans made by them as shall be necessary
to cause such purchasing Bank to share the excess payment pro rata with each of them; provided,
however, that if all or any portion of such excess payment is thereafter recovered from the
purchasing Bank, such purchase shall to that extent be rescinded and each other Bank shall repay to
the purchasing Bank the purchase price paid therefor, together with an amount equal to such paying
Bank's ratable share (according to the proportion of (i) the amount of such paying Bank's required
repayment to (ii) the total amount so recovered from the purchasing Bank) of any interest or other
amount paid or payable by the purchasing Bank in respect of the total amount so recovered. The
Borrower agrees that any Bank so purchasing a participation from another Bank may, to the fullest
extent permitted by law, exercise all its rights of payment (including the right of set-off, but
subject to Section 11.09) with respect to such participation as fully as if such Bank were the
direct creditor of the Borrower in the amount of such participation. the Administrative Agent will
keep records (which shall be conclusive and binding in the absence of manifest error) of
participations purchased under this Section and will in each case notify the Banks following any
such purchases or repayments.......................................................................... 33
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2.14 The Election of Approving Banks to Continue Funding. If one or more Banks (the "Declining Bank" or
"Declining Banks") provides the Administrative Agent with, and the Administrative Agent has
actually received, a written notice in the form of Exhibit H for reasons other than a Default and
the other Bank or Banks do approve further Revolving Loans (including the conversion and extension
of such Revolving Loans) or the further issuances of, extensions of, the automatic renewal of or
amendments to Letters of Credit, the Administrative Agent shall notify the Banks by 6:00 p.m. (New
York City time) that same day. If the Bank or Banks which are not the Declining Banks desire, they
may (on a pro rata basis among the Banks that have elected to continue funding) make the full or
partial amount of such requested Revolving Loan or issue or amend the requested Letter of Credit
irrespective of the Declining Banks' disapproval (in such case, the Banks that elect to continue
funding shall be referred to as the "Approving Banks"). In such event, from such date (the
"Conversion to Reduced Funding Banks Date") forward (a) all subsequent Revolving Loans and
Issuances of Letters of Credit or Amendments to Letters of Credit that increase the face amount of
a Letter of Credit or extend the term of a Letter of Credit shall be made unilaterally by the
Approving Banks and no Letter of Credit thereafter Issued shall be participated in by the Declining
Banks, (b) all Banks' interests in the Collateral and loan management decisions shall be pro-rata
based on each Bank's total Effective Amount of Revolving Loans, plus the Effective Amounts of such
Bank's L/C Obligations from time to time, and (c) the Approving Banks' Pro Rata Share of the
Uncommitted Line Portion shall be increased on the basis of each such advance and Issuance of a
Letter of Credit made by such approving Bank.......................................................... 33
2.15 Payments from Guarantor and Liquidation of Collateral. Notwithstanding anything to the contrary
contained herein, in the event repayment is made to the Banks by Guarantor or pursuant to a
liquidation of Collateral, such repayment shall be shared by the Banks on the basis of each Bank's
then existing Adjusted Pro Rata Share rather than each Bank's Pro Rata Share.......................... 34
ARTICLE III
THE LETTERS OF CREDIT
3.01 The Letter of Credit Lines............................................................................ 35
3.02 Issuance, Amendment and Renewal of Letters of Credit.................................................. 36
3.03 Risk Participations, Drawings, Reducing Letters of Credit and Reimbursements.......................... 39
3.04 Repayment of Participations........................................................................... 41
3.05 Role of the Issuing Banks............................................................................. 41
3.06 Obligations Absolute. The Obligations of the Borrower under this Agreement and any L/C-Related
Document to reimburse an Issuing Bank for a drawing under a Letter of Credit or for a Reducing L/C
Borrowing, and to repay any L/C Borrowing and any drawing under a Letter of Credit or Reducing L/C
Borrowing converted into Revolving Loans, shall be unconditional and irrevocable, and shall be paid
strictly in accordance with the terms of this Agreement and each such other L/C-Related Document
under all circumstances, including the following:..................................................... 42
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3.07 Cash Collateral Pledge. Upon the request of the Administrative Agent, (i) if an Issuing Bank has
honored any full or partial drawing request on any Letter of Credit and such drawing has resulted
in an L/C Borrowing hereunder, or (ii) if, as of the Expiration Date, any Letters of Credit may for
any reason remain outstanding and partially or wholly undrawn, the Borrower shall immediately Cash
Collateralize the L/C Obligations in an amount equal to such L/C Obligations. Upon the occurrence
of the circumstances described in Section 2.06 requiring the Borrower to Cash Collateralize Letters
of Credit, then, the Borrower shall immediately Cash Collateralize the L/C Obligations in an amount
equal to the applicable excess........................................................................ 43
3.08 Letter of Credit Fees................................................................................. 44
3.09 Applicability of Uniform Customs and Practice and ISP98. Unless otherwise expressly agreed by an
Issuing Bank and the Borrower when a Letter of Credit is Issued (including any such agreement
applicable to an Existing Letter of Credit), the rules of the Uniform Customs and Practice for
Documentary Credits, as most recently published by the International Chamber of Commerce (the
"ICC") at the time of Issuance (including the ICC decision published by the Commission on Banking
Technique and Practice on April 6, 1998 regarding the European single currency (euro)) shall apply
to each standby Letter of Credit and documentary Letter of Credit. If Borrower desires to use the
rules of the "International Standby Practices 1998" published by the Institute of International
Banking Law & Practice (or such later version thereof as may be in effect at the time of Issuance)
for standby Letters of Credit, Borrower shall request and note this explicitly on the standby
Letter of Credit application.......................................................................... 44
3.10 Existing Letters of Credit. Borrower hereby acknowledges and agrees that the Existing Letters of
Credit listed on Schedule 3.10 hereto shall be deemed to be Letters of Credit Issued under this
Agreement for all purposes............................................................................ 44
ARTICLE IV
TAXES, YIELD PROTECTION AND ILLEGALITY
4.01 Taxes................................................................................................... 44
4.02 Illegality.............................................................................................. 45
4.03 Increased Costs and Reduction of Return................................................................. 46
4.04 Funding Losses. The Borrower shall reimburse each Bank and hold each Bank harmless from any loss or
expense which the Bank may sustain or incur as a consequence of:........................................ 47
4.05 Inability to Determine Rates. If the Administrative Agent and the Banks determine that for any
reason adequate and reasonable means do not exist for determining the Offshore Rate for any
requested Interest Period with respect to a proposed Offshore Rate Loan, or that the Offshore Rate
applicable pursuant to Subsection 2.08(a) for any requested Interest Period with respect to a
proposed Offshore Rate Loan does not adequately and fairly reflect the cost to the Banks of funding
such Loan, the Administrative Agent will promptly so notify the Borrower and each Bank. Thereafter,
the obligation of the Banks to make or maintain Offshore Rate Loans, as the case may be, hereunder
shall be suspended until the Administrative Agent upon the instruction of the Banks revokes such
notice in writing. Upon receipt of such notice, the Borrower may revoke any Notice of Borrowing or
Notice of Conversion/Continuation then submitted by it. If the Borrower does not revoke such
Notice, the Banks shall make, convert or continue the Loans, as proposed by the Borrower, in the
amount specified in the applicable notice submitted by the Borrower, but such Loans shall be made,
converted or continued as Base Rate Loans instead of Offshore Rate Loans.............................. 47
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4.06 Reserves on Offshore Rate Loans. The Borrower shall pay to each Bank, as long as such Bank shall
be required under regulations of the FRB to maintain reserves with respect to liabilities or assets
consisting of or including Eurocurrency funds or deposits (currently known as "Eurocurrency
liabilities"), additional costs on the unpaid principal amount of each Offshore Rate Loan equal to
the actual costs of such reserves allocated to such Loan by the Bank (as determined by the Bank in
good faith, which determination shall be conclusive), payable on each date on which interest is
payable on such Loan, provided, however, that the Borrower shall have received at least 15 days'
prior written notice (with a copy to the Administrative Agent) of such additional interest from the
Bank. If a Bank fails to give notice 15 days prior to the relevant Interest Payment Date, such
additional interest shall be payable 15 days from receipt of such notice.............................. 48
4.07 Certificates of Banks. Together with any demand by a Bank for reimbursement or compensation
pursuant to this Article IV, such Bank shall provide to the Borrower (with a copy to the
Administrative Agent) a certificate signed by an authorized officer of the Bank (a) describing the
event giving rise to such demand, and (b) showing the method and detailed calculations (which may
include any reasonable averaging, attribution or allocation procedures) used by the Bank to
determine the amount demanded by the Bank. In calculating the amount of costs, expenses, capital
requirements or rate of reduction allocable to the Borrower, such Bank shall use such reasonable
methods as such Bank shall determine. Such calculation and certification shall be conclusive and
binding on the Borrower in the absence of manifest error.............................................. 48
4.08 Substitution of Banks. Upon the receipt by the Borrower from any Bank (an "Affected Bank") of a
claim for compensation under Section 4.03, the Borrower may: (a) request the Affected Bank to use
its best efforts to obtain a replacement bank or financial institution satisfactory to the Borrower
to acquire and assume all or a ratable part of all of such Affected Bank's Loans and Uncommitted
Line Portion (a "Replacement Bank"); (b) request one or more of the other Banks to acquire and
assume all or part of such Affected Bank's Loans and Uncommitted Line Portion; or (c) designate a
Replacement Bank. Any such designation of a Replacement Bank under clause (a) or (c) shall be
subject to the prior written consent of Agents (which consent shall not be unreasonably withheld)..... 48
4.09 Survival. The agreements and Obligations of the Borrower in this Article IV shall survive the
payment all other Obligations........................................................................ 48
ARTICLE V
CLOSING ITEMS
5.01 Matters to be Satisfied Upon Execution of Agreement. At the time the Banks execute this Agreement,
unless otherwise waived by the Banks, the Documentation Agent shall have received all of the
following, in form and substance satisfactory to the Documentation Agent, the Administrative Agent,
and each Bank, and in sufficient copies for each Bank:................................................ 48
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ARTICLE VI
REPRESENTATIONS AND WARRANTIES
6.01 Existence and Power. Each of the Borrower, its Subsidiaries and Guarantor:........................... 50
6.02 Authorization; No Contravention. The execution, delivery and performance by the Borrower and
Guarantor of each Loan Document to which such Person is party, have been duly authorized, and do
not and will not:..................................................................................... 50
6.03 Governmental Authorization. No approval, consent, exemption, authorization, or other action by, or
notice to, or filing with, any Governmental Authority is necessary or required in connection with the
execution, delivery or performance by, or enforcement against, the Borrower or any of its
Subsidiaries or Guarantor, as applicable, of any Loan Document........................................ 51
6.04 Binding Effect. This Agreement and each other Loan Document to which the Borrower or any of its
Subsidiaries or Guarantor is a party constitute the legal, valid and binding obligations of such
Person to the extent it is a party thereto, enforceable against such Person in accordance with
their respective terms, except as enforceability may be limited by applicable bankruptcy,
insolvency, or similar laws affecting the enforcement of creditors' rights generally or by general
principles of equity.................................................................................. 51
6.05 Litigation. Except as specifically disclosed in Schedule 6.05, there are no actions, suits or
proceedings, pending, or to the knowledge of the Borrower, or Guarantor threatened at law, in
equity, in arbitration or before any Governmental Authority, against the Borrower, or any of its
Subsidiaries or Guarantor or any of their respective properties which purport to affect or pertain
to this Agreement or any other Loan Document, or any of the transactions contemplated hereby or
thereby; and no injunction, writ, temporary restraining order or any order of any nature has been
issued by any court or other Governmental Authority purporting to enjoin or restrain the execution,
delivery or performance of this Agreement or any other Loan Document, or directing that the
transactions provided for herein or therein not be consummated as herein or therein provided.......... 51
6.06 No Default. No Default or Event of Default exists or would result from the incurring of any
Obligations by the Borrower. As of the Closing Date, neither the Borrower nor any of its
Subsidiaries are in default under or with respect to any Contractual Obligation in any respect
which, individually or together with all such defaults, could reasonably be expected to have a
Material Adverse Effect............................................................................... 51
6.07 ERISA Compliance. Except as specifically disclosed in Schedule 6.07:................................. 51
6.08 Use of Proceeds; Margin Regulations. The proceeds of the Loans are to be used solely for the
purposes set forth in and permitted by Section 7.12. Neither the Borrower nor any Subsidiary is
generally engaged in the business of purchasing or selling Margin Stock or extending credit for the
purpose of purchasing or carrying Margin Stock........................................................ 52
6.09 Title to Properties. The Borrower and each of its Subsidiaries have good record and marketable
title in fee simple to, or valid leasehold interests in, all real property necessary or used in the
ordinary conduct of their respective businesses, except for such defects in title as could not,
individually or in the aggregate, have a Material Adverse Effect. As of the Closing Date, the
property of the Borrower and its Subsidiaries is subject to no Liens, other than Permitted Liens...... 52
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6.10 Taxes. The Borrower and its Subsidiaries have filed all Federal and other material tax returns and
reports required to be filed, and have paid all Federal and other material taxes, assessments, fees
and other governmental charges shown thereon to be due and payable, and have paid all material
taxes, assessments, fees and other governmental charges levied or imposed upon them or their
properties, income or assets as due and payable, except those which are being contested in good
faith by appropriate proceedings and for which adequate reserves have been provided in accordance
with GAAP. There is no proposed tax assessment against the Borrower or any of its Subsidiaries
that would, if made, have a Material Adverse Effect................................................... 52
6.11 Financial Condition................................................................................... 52
6.12 Environmental Matters. The Borrower conducts in the ordinary course of business a review of the
effect of existing Environmental Laws and existing Environmental Claims on its business, operations
and properties, and as a result thereof the Borrower has reasonably concluded that, except as
previously specifically disclosed in Schedule 6.12, such Environmental Laws and Environmental
Claims could not, individually or in the aggregate, reasonably be expected to have a Material
Adverse Effect........................................................................................ 53
6.13 Regulated Entities. Neither the Borrower, nor any Person controlling the Borrower, or any of its
Subsidiaries, is an "Investment Company" within the meaning of the Investment Company Act of 1940.
The Borrower is not subject to regulation under the Public Utility Holding Company Act of 1935, the
Federal Power Act, the Interstate Commerce Act, any state public utilities code, or any other
Federal or state statute or regulation limiting its ability to incur Indebtedness..................... 53
6.14 No Burdensome Restrictions. Neither the Borrower nor any of its Subsidiaries is a party to or
bound by any Contractual Obligation, or subject to any restriction in any Organization Document, or
any Requirement of Law, which could reasonably be expected to have a Material Adverse Effect.......... 53
6.15 Copyrights, Patents, Trademarks and Licenses, Etc. To the Borrower's best knowledge, the Borrower
or its Subsidiaries own or are licensed or otherwise have the right to use all of the patents,
trademarks, service marks, trade names, copyrights, contractual franchises, authorizations and
other rights that are reasonably necessary for the operation of their respective businesses,
without conflict with the rights of any other Person. To the knowledge of the Borrower, no slogan
or other advertising device, product, process, method, substance, part or other material now
employed, or now contemplated to be employed, by the Borrower or any Subsidiary infringes upon any
rights held by any other Person. Except as specifically disclosed in Schedule 6.05, no claim or
litigation regarding any of the foregoing is pending or threatened, and no patent, invention,
device, application, principle or any statute, law, rule, regulation, standard or code is pending
or, to the knowledge of the Borrower, proposed........................................................ 53
6.16 Subsidiaries. The Borrower has no Subsidiaries other than those specifically disclosed in part (a)
of Schedule 6.16 hereto and have no equity investments in any other corporation or entity other
than those specifically disclosed in part (b) of Schedule 6.16........................................ 53
6.17 Insurance. Except as specifically disclosed in Schedule 6.17, the properties of the Borrower and
its Subsidiaries are insured with financially sound and reputable insurance companies not
Affiliates of the Borrower, in such amounts, with such deductibles and covering such risks as are
customarily carried by companies engaged in similar businesses and owning similar properties in
localities where the Borrower or such Subsidiary operates............................................. 53
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6.18 Full Disclosure. To the Borrower's best knowledge, none of the representations or warranties made
by the Borrower or any of its Subsidiaries in the Loan Documents as of the date such
representations and warranties are made or deemed made, and none of the statements contained in any
exhibit, report, statement or certificate furnished by or on behalf of the Borrower or any of its
Subsidiaries in connection with the Loan Documents (including the offering and disclosure materials
delivered by or on behalf of the Borrower to the Banks prior to the Closing Date), contains any
untrue statement of a material fact or omits any material fact required to be stated therein or
necessary to make the statements made therein, in light of the circumstances under which they are
made, not misleading as of the time when made or delivered............................................ 54
ARTICLE VII
AFFIRMATIVE COVENANTS
7.01 Financial Statements. The Borrower shall deliver to the Banks, in form and detail satisfactory to
the Banks:............................................................................................ 54
7.02 Certificates; Other Information. The Borrower shall furnish to the Agents and the Banks:............. 55
7.03 Notices. The Borrower shall promptly notify the Agents and each Bank:................................ 55
7.04 Preservation of Corporate Existence, Etc. The Borrower shall, and shall cause each of its
Subsidiaries to:...................................................................................... 56
7.05 Maintenance of Property. The Borrower shall maintain, and shall cause each of its Subsidiaries to
maintain, and preserve all its property which is used or useful in its business in good working
order and condition, ordinary wear and tear excepted and make all necessary repairs thereto and
renewals and replacements thereof except in any case where the failure to do so could not
reasonably be expected to have a Material Adverse Effect.............................................. 57
7.06 Insurance. The Borrower shall maintain, and shall cause each of its Subsidiaries to maintain, with
financially sound and reputable independent insurers, insurance with respect to its properties and
business against loss or damage of the kinds customarily insured against by Persons engaged in the
same or similar business, of such types and in such amounts as are customarily carried under
similar circumstances by such other Persons, including, without limitation, marine cargo insurance,
if appropriate. The Administrative Agent, for the benefit of the Banks, shall be named as an
additional insured and loss payee under all such polices, without liability for premiums or club
calls................................................................................................. 57
7.07 Payment of Obligations. The Borrower shall, and shall cause each of its Subsidiaries to, pay and
discharge as the same shall become due and payable, all their respective obligations and
liabilities, including:............................................................................... 57
7.08 Compliance with Laws. The Borrower shall comply, and shall cause each of its Subsidiaries to comply,
with all Requirements of Law of any Governmental Authority having jurisdiction over it or its
business (including the Federal Fair Labor Standards Act)............................................. 57
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7.09 Compliance with ERISA. The Borrower shall, and shall cause each of its ERISA Affiliates to: (a)
maintain each Plan in compliance with the applicable provisions of ERISA, the Code and other
federal or state law; (b) cause each Plan which is qualified under Section 401(a) of the Code to
maintain such qualification; and (c) make all required contributions to any Plan subject to Section
412 of the Code....................................................................................... 57
7.10 Inspection of Property and Books and Records. The Borrower shall maintain and shall cause each of
its Subsidiaries to maintain proper books of record and account, in which full, true and correct
entries in conformity with GAAP consistently applied shall be made of all financial transactions
and matters involving the assets and business of the Borrower and such Subsidiary. The Borrower
shall permit, and shall cause each of its Subsidiaries to permit representatives and independent
contractors of either of the Agents or any Bank to visit and inspect any of their respective
properties, to examine their respective corporate, financial and operating records, and make copies
thereof or abstracts therefrom, and to discuss their respective affairs, finances and accounts with
their respective directors, officers, and independent public accountants, all at the expense of the
Agent or Bank causing such inspection and at such reasonable times during normal business hours and
as often as may be reasonably desired, upon reasonable advance notice to the Borrower; provided,
however, that when an Event of Default exists either of the Agents or any Bank may do any of the
foregoing at the expense of the Borrower at any time during normal business hours and without
advance notice........................................................................................ 57
7.11 Environmental Laws. The Borrower shall, and shall cause each of its Subsidiaries to, conduct its
operations and keep and maintain its property in compliance in all material respects with all
Environmental Laws.................................................................................... 58
7.12 Use of Proceeds. The Borrower shall use the proceeds of the Loans for the uses described in this
Agreement and not in contravention of any Requirement of Law or of any Loan Document restrictions on
use of loan proceeds.................................................................................. 58
7.13 Collateral Position Audit. At such times as Agents deem advisable, the Borrower will allow Agents
or an entity satisfactory to Agents to conduct a thorough examination of the Collateral, and the
Borrower will fully cooperate in such examination. The Borrower will pay the costs and expenses of
one such examination each calendar year............................................................... 58
7.14 Lock Box. The Borrower shall (i) maintain a lock box with Bank of America, N.A. (the "Lock Box")
and shall notify in writing and otherwise take such reasonable steps to ensure that all Account
Debtors under any of its Accounts forward payment in the form of cash, checks, drafts or other
similar items of payment directly to such Lock Box and shall provide Banks with reasonable evidence
of such notification, and (ii) deposit and cause its Subsidiaries to deposit or cause to be
deposited all payments under such Accounts to the Lock Box. In the event that any Account Debtor
does make any payment directly to the Borrower, the Borrower shall promptly deposit such amounts
into the Lock Box. The Borrower and each Bank acknowledge and agree that prior to the Activation
Period, the Borrower may operate and transact business through the Lock Box account in its normal
fashion, including making withdrawals from the Lock Box account. The Borrower and each Bank further
acknowledge and agree that during the Activation Period, Bank of America, N.A. shall transfer all
collected and available balances in the Lock Box to the Bank Blocked Account pursuant to the Three
Party Agreement. The Borrower and each Bank acknowledge and agree that the Bank Blocked Account is
owned by the Collateral Agent for the benefit of the Agents, the Issuing Banks and the Banks and
the Lock Box is under the dominion and control of the Collateral Agent. The Collateral Agent at any
time may apply amounts contained in the Bank Blocked Account toward satisfaction of the Obligations... 58
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7.15 Financial Covenants. The Borrower will, at all times, observe the following financial covenants:..... 58
7.16 Separate Operations. The Borrower will at all times maintain and observe policies and procedures to
insure that its operations are separate and distinct from the operations of Borrower's Affiliates..... 59
ARTICLE VIII
NEGATIVE COVENANTS
8.01 Limitation on Liens. The Borrower shall not, and shall not suffer or permit any Subsidiary to,
directly or indirectly, make, create, incur, assume or suffer to exist any Lien upon or with
respect to any part of its property, whether now owned or hereafter acquired, other than the
following ("Permitted Liens"):........................................................................ 60
8.02 Consolidations and Mergers. The Borrower shall not, nor shall it suffer or permit any of its
Subsidiaries to, merge, consolidate with or into, or convey, transfer, lease or otherwise dispose of
(whether in one transaction or in a series of transactions) all or substantially all of its assets
(whether now owned or hereafter acquired) to or in favor of any Person................................ 61
8.03 Limitation on Indebtedness. The Borrower shall not suffer or permit any of its Subsidiaries to,
create, incur, assume, suffer to exist, or otherwise become or remain directly or indirectly liable
with respect to, any Indebtedness, except:............................................................ 61
8.04 Transactions with Affiliates. The Borrower shall not, and shall not suffer or permit any of its
Subsidiaries to, enter into any transaction with any Affiliate of the Borrower, except upon fair
and reasonable terms no less favorable to the Borrower or such Subsidiary than would obtain in a
comparable arm's-length transaction with a Person not an Affiliate of the Borrower or such
Subsidiary. Without limiting the foregoing, all sales of Product by Borrower to, and purchases of
Product by Borrower from, any Affiliate of Borrower shall be at the market price on the day of
sale, except for transactions made in connection with Borrower's Index Sales Strategies which
strategies shall have been approved by the Banks prior to any such transactions....................... 61
8.05 Use of Proceeds. The Borrower shall not suffer or permit any of its Subsidiaries to, use any
portion of the Loan proceeds or any Letter of Credit, directly or indirectly, (a) to purchase or
carry Margin Stock, (b) to repay or otherwise refinance indebtedness of the Borrower or others
incurred to purchase or carry Margin Stock, (c) to extend credit for the purpose of purchasing or
carrying any Margin Stock, or (d) to acquire any security in any transaction that is subject to
Section 13 or 14 of the Exchange Act.................................................................. 62
8.06 Contingent Obligations. The Borrower shall not suffer or permit any of its Subsidiaries to, create,
incur, assume or suffer to exist any Contingent Obligations except:................................... 62
8.07 Restricted Payments. The Borrower shall not suffer or permit any of its Subsidiaries to, directly
or indirectly declare or make, any distribution of income or capital on account of any membership
interest of the Borrower now or hereafter in existence ("Distributions"), or set aside or otherwise
deposit or invest any sums for such purpose, except Distributions to its members, so long as no
Default or Event of Default has occurred or would result therefrom.................................... 62
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8.08 ERISA. The Borrower shall not, nor suffer or permit any of its ERISA Affiliates to: (a) engage in
a prohibited transaction or violation of the fiduciary responsibility rules with respect to any
Plan; or (b) engage in a transaction that could be subject to Section 4069 or 4212(c) of ERISA........ 62
8.09 Change in Business. The Borrower shall not, nor suffer or permit any of its Subsidiaries to,
engage in any line of business different from the line of business carried on by the Borrower and
its Subsidiaries on the date hereof................................................................... 62
8.10 Accounting Changes. The Borrower shall not, nor suffer or permit any of its Subsidiaries to, make
any significant change in accounting treatment or reporting practices, except as required by GAAP,
or change the fiscal year of the Borrower or of any Subsidiary........................................ 62
8.11 Net Position. At no time will the Borrower allow its Net Position to exceed 5,000,000 MMBTUS of
natural gas. At no time will the Borrower allow the sum of the following: (a) 25% of the
Borrower's Net Position Value, plus (b) Borrower's Transportation and Storage Exposure, plus (c)
Borrower's Below Index Sales Exposure, to exceed 33% of Borrower's Net Working Capital at such
time, where,.......................................................................................... 62
8.12 Loans and Investments. The Borrower shall not purchase or acquire, or suffer or permit any
Subsidiary to purchase or acquire, or make any commitment therefor, any capital stock, equity
interest, or any obligations or other securities of, or any interest in, any Person, or make or
commit to make any Acquisitions, or make or commit to make any advance, loan, extension of credit
or capital contribution to or any other investment in, any Person including any Affiliate of
Borrower, except for:................................................................................. 63
8.13 Change of Management. Borrower shall not permit any Change of Management. For purposes of this
Section 8.13, "Change of Management" shall mean that ▇. ▇. ▇▇▇▇▇▇▇▇ has ceased to act in his
capacity as chief executive officer of the Borrower................................................... 63
8.14 Deposit Accounts. Borrower shall not maintain any deposit accounts with a bank or financial
institution other than the Bank Blocked Account with the Collateral Agent, except that the Borrower
may maintain the Lock Box with Bank of America, N.A. which shall be pledged to the Administrative
Agent, for the benefit of the Agents, the Issuing Banks and the Banks pursuant to the Three Party
Agreement............................................................................................. 63
8.15 Risk Management Policy. The Borrower will not materially change its risk management policies
without the prior written consent of the Administrative Agent and the Banks. Borrower agrees that
upon request by Agents, from time to time, the Borrower and the Banks will review and evaluate
Borrower's risk management policies................................................................... 63
8.16 Swap-Related Standby Letters of Credit. The Borrower shall not permit outstanding Swap-Related
Standby Letters of Credit plus any net ▇▇▇▇-to-Market values of amounts owed to Swap Banks by the
Borrower under Swap Contracts to exceed $50,000,000................................................... 63
ARTICLE IX
EVENTS OF DEFAULT
9.01 Event of Default. Any of the following shall constitute an "Event of Default":....................... 64
9.02 Remedies. If any Event of Default occurs, the Administrative Agent may and shall, at the request
of the Required Banks:................................................................................ 66
9.03 Rights Not Exclusive. The rights provided for in this Agreement and the other Loan Documents are
cumulative and are not exclusive of any other rights, powers, privileges or remedies provided by
law or in equity, or under any other instrument, document or agreement now existing or hereafter
arising............................................................................................... 66
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ARTICLE X
AGENTS
10.01 Appointment and Authorization......................................................................... 66
10.02 Delegation of Duties. Each of the Agents may execute any of its duties under this Agreement or any
other Loan Document by or through agents, employees or attorneys-in-fact and shall be entitled to
advice of counsel concerning all matters pertaining to such duties. Neither of the Agents shall
not be responsible for the negligence or misconduct of any agent or attorney-in-fact that it
selects with reasonable care.......................................................................... 67
10.03 Liability of Agents. None of Agent-Related Persons shall (a) be liable for any action taken or
omitted to be taken by any of them under or in connection with this Agreement or any other Loan
Document or the transactions contemplated hereby (except for its own gross negligence or willful
misconduct), or (b) be responsible in any manner to any of the Banks for any recital, statement,
representation or warranty made by the Borrower or any Subsidiary or Affiliate of the Borrower, or
any officer thereof, contained in this Agreement or in any other Loan Document, or in any
certificate, report, statement or other document referred to or provided for in, or received by
Agents under or in connection with, this Agreement or any other Loan Document, or for the value of
or title to any Collateral, or the validity, effectiveness, genuineness, enforceability or
sufficiency of this Agreement or any other Loan Document, or for any failure of the Borrower or any
other party to any Loan Document to perform its obligations hereunder or thereunder. No
Agent-Related Person shall be under any obligation to any Bank to ascertain or to inquire as to the
observance or performance of any of the agreements contained in, or conditions of, this Agreement
or any other Loan Document, or to inspect the properties, books or records of the Borrower or any
of the Borrower's Subsidiaries or Affiliates.......................................................... 67
10.04 Reliance by Agents.................................................................................... 67
10.05 Notice of Default. Agents shall not be deemed to have knowledge or notice of the occurrence of any
Default or Event of Default, except with respect to defaults in the payment of principal, interest
and fees required to be paid to the Administrative Agent for the account of the Banks, unless the
Administrative Agent shall have received written notice from a Bank or the Borrower referring to
this Agreement, describing such Default or Event of Default and stating that such notice is a
"notice of default." The Administrative Agent will notify the BNP Paribas, as an agent, and the
Banks of its receipt of any such notice. The Agents shall take such action with respect to such
Default or Event of Default as may be requested by all of the Banks or the Required Banks, as
applicable, in accordance with Article IX; provided, however, that unless and until the
Administrative Agent has received any such request, the Agents may (but shall not be obligated to)
take such action, or refrain from taking such action, with respect to such Default or Event of
Default as it shall deem advisable or in the best interest of the Banks............................... 68
10.06 Credit Decision. Each Bank acknowledges that none of Agent-Related Persons has made any
representation or warranty to it, and that no act by Agents hereinafter taken, including any review
of the affairs of the Borrower and its Subsidiaries, shall be deemed to constitute any
representation or warranty by any Agent-Related Person to any Bank. Each Bank represents to the
Agents that it has, independently and without reliance upon any Agent-Related Person and based on
such documents and information as it has deemed appropriate, made its own appraisal of and
investigation into the business, prospects, operations, property, financial and other condition and
creditworthiness of the Borrower and its Subsidiaries, the value of and title to any Collateral,
and all applicable bank regulatory laws relating to the transactions contemplated hereby, and made
its own decision to enter into this Agreement and to extend credit to the Borrower hereunder. Each
Bank also represents that it will, independently and without reliance upon any Agent-Related Person
and based on such documents and information as it shall deem appropriate at the time, continue to
make its own credit analysis, appraisals and decisions in taking or not taking action under this
Agreement and the other Loan Documents, and to make such investigations as it deems necessary to
inform itself as to the business, prospects, operations, property, financial and other condition
and creditworthiness of the Borrower. Except for notices, reports and other documents expressly
herein required to be furnished to the Banks by the Agents, the Agents shall not have any duty or
responsibility to provide any Bank with any credit or other information concerning the business,
prospects, operations, property, financial and other condition or creditworthiness of the Borrower
which may come into the possession of any of Agent-Related Persons.................................... 68
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10.07 Indemnification. Whether or not the transactions contemplated hereby are consummated, the Banks
shall indemnify upon demand Agent-Related Persons (to the extent not reimbursed by or on behalf of
the Borrower and without limiting the obligation of the Borrower to do so), pro rata, from and
against any and all Indemnified Liabilities; provided, however, that no Bank shall be liable for
the payment to Agent-Related Persons of any portion of such Indemnified Liabilities resulting
solely from such Person's gross negligence or willful misconduct. Without limitation of the
foregoing, each Bank shall reimburse Agents upon demand for its ratable share of any costs or
out-of-pocket expenses (including Attorney Costs) incurred by Agents in connection with the
preparation, execution, delivery, administration, modification, amendment or enforcement (whether
through negotiations, legal proceedings or otherwise) of, or legal advice in respect of rights or
responsibilities under, this Agreement, any other Loan Document, or any document contemplated by or
referred to herein, to the extent that Agents are not reimbursed for such expenses by or on behalf
of the Borrower. The undertaking in this Section shall survive the payment of all Obligations
hereunder and the resignation or replacement of Agents................................................ 69
10.08 Agents in Individual Capacity. Fortis and its Affiliates and BNP Paribas and its Affiliates may
make loans to, issue letters of credit for the account of, accept deposits from, acquire equity
interests in and generally engage in any kind of banking, trust, financial advisory, underwriting
or other business with the Borrower and its Subsidiaries and Affiliates as though Fortis and BNP
Paribas were not Agents or Issuing Banks hereunder and without notice to or consent of the Banks.
The Banks acknowledge that, pursuant to such activities, Fortis or its Affiliates and BNP Paribas
or its Affiliates may receive information regarding the Borrower or its Affiliates (including
information that may be subject to confidentiality obligations in favor of the Borrower or such
Subsidiary) and acknowledge that the Agents shall be under no obligation to provide such
information to them. With respect to its Loans, Fortis and BNP Paribas shall have the same rights
and powers under this Agreement as any other Bank and may exercise the same as though it were not
the Agents or Issuing Banks, and the terms "Bank" and "Banks" include each of Fortis and BNP
Paribas in its individual capacity.................................................................... 69
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10.09 Successor Administrative Agent. The Administrative Agent may resign as the Administrative Agent
upon thirty (30) days' notice to the Banks. If the Administrative Agent resigns under this
Agreement, BNP Paribas shall automatically become the successor agent, unless BNP Paribas declines.
If BNP Paribas declines, the Required Banks shall appoint, from among the Banks, a successor agent
for the Banks. If no successor agent is appointed prior to the effective date of the resignation
of the Administrative Agent, the resigning Administrative Agent may appoint, after consulting with
the Banks, a successor agent from among the Banks. Upon the acceptance of its appointment as
successor agent hereunder, the successor agent shall succeed to all the rights, powers and duties
of the retiring Administrative Agent and the term "Administrative Agent" shall mean such successor
agent and the retiring Administrative Agent's appointment, powers and duties as Administrative
Agent shall be terminated. After any retiring Administrative Agent's resignation hereunder as
Administrative Agent, the provisions of this Article X and Sections 11.04 and 11.05 shall inure to
its benefit as to any actions taken or omitted to be taken by it while it was Administrative Agent
under this Agreement. If no successor agent has accepted appointment as the Administrative Agent
by the date which is thirty (30) days following a retiring Administrative Agent's notice of
resignation, the retiring Administrative Agent's resignation shall nevertheless thereupon become
effective and the Banks shall perform all of the duties of the Administrative Agent hereunder until
such time, if any, as the Banks appoint a successor agent as provided for above....................... 69
10.10 Withholding Tax....................................................................................... 70
10.11 Collateral Matters. (a) The Agents are authorized on behalf of all the Banks, without the
necessity of any notice to or further consent from the Banks, from time to time to take any action
with respect to any Collateral or the Loan Documents which may be necessary to perfect and maintain
perfected the security interest in and Liens upon the Collateral granted pursuant to the Loan
Documents............................................................................................. 71
10.12 Monitoring Responsibility. Each Bank will make its own credit decisions hereunder, including the
decision whether or not to make advances or consent to the Issuance of Letters of Credit, thus the
Agents shall have no duty to monitor the Collateral Position, the amounts outstanding under
sub-lines or the reporting requirements or the contents of reports delivered by the Borrower. Each
Bank assumes the responsibility of keeping itself informed at all times............................... 72
ARTICLE XI
MISCELLANEOUS
11.01 Amendments and Waivers. No amendment, supplement, modification or waiver of any provision of this
Agreement or any other Loan Document, and no consent with respect to any departure by the Borrower
therefrom, shall be effective unless the same shall be in accordance with the provisions of this
Section 11.01. The Required Banks may, or, with the written consent of the Required Banks, the
Administrative Agent may, from time to time, (a) enter into with the Borrower written amendments,
supplements or modifications hereto and to the other Loan Documents for the purpose of adding any
provisions to this Agreement or the other Loan Documents or changing in any manner the rights of
the Banks or of the Borrower hereunder or thereunder or (b) waive, on such terms and conditions as
the Required Banks or the Administrative Agent, as the case may be, may specify in such instrument,
any of the requirements of this Agreement or the other Loan Documents or any Default or Event of
Default and its consequences; provided, however, that no such waiver and no such amendment,
supplement or modification shall (i) reduce the amount or extend the scheduled date of maturity of
any Loan or of any installment thereof, or reduce the stated rate of any interest or fee payable
hereunder or extend the scheduled date of any payment thereof or increase the amount or extend the
expiration date of any Bank's Uncommitted Line Portion, in each case without the consent of each
Bank affected thereby, or (ii) amend, modify or waive any provision of this Section 11.01 or reduce
the percentage specified in the definition of Required Banks, or consent to the assignment or
transfer by the Borrower of any of its rights and obligations under this Agreement and the other
Loan Documents or release all or substantially all of the Collateral or release the Guarantor from
its obligations under the Guaranty, in each case without the written consent of each of the Banks
directly affected thereby, or (iii) amend, modify or waive any provision of Section 10 without the
written consent of the Agents. Any such waiver and any such amendment, supplement or modification
shall apply equally to each of the Banks and shall be binding upon the Borrower, the Banks, the
Agents and all future holders of the Loans. In the case of any waiver, the Borrower, the Banks and
the Agents shall be restored to their former positions and rights hereunder and under the other
Loan Documents, and any Default or Event of Default waived shall be deemed to be cured and not
continuing; but no such waiver shall extend to any subsequent or other Default or Event of Default
or impair any right consequent thereon. Any such waiver or consent shall be effective only in the
specific instance and for the specific purpose for which given........................................ 72
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11.02 Notices............................................................................................... 73
11.03 No Waiver; Cumulative Remedies. No failure to exercise and no delay in exercising, on the part of
the Agents or any Bank, any right, remedy, power or privilege hereunder, shall operate as a waiver
thereof; nor shall any single or partial exercise of any right, remedy, power or privilege
hereunder preclude any other or further exercise thereof or the exercise of any other right,
remedy, power or privilege............................................................................ 73
11.04 Costs and Expenses. The Borrower shall:.............................................................. 73
11.05 INDEMNITY. WHETHER OR NOT THE TRANSACTIONS CONTEMPLATED HEREBY ARE CONSUMMATED, THE BORROWER SHALL
INDEMNIFY AND HOLD AGENT-RELATED PERSONS, AND EACH BANK AND EACH OF ITS RESPECTIVE OFFICERS,
DIRECTORS, EMPLOYEES, COUNSEL, AGENTS AND ATTORNEYS-IN-FACT (EACH, AN "INDEMNIFIED PERSON")
HARMLESS FROM AND AGAINST ANY AND ALL LIABILITIES, OBLIGATIONS, LOSSES, DAMAGES, PENALTIES,
ACTIONS, JUDGMENTS, SUITS, COSTS, CHARGES, EXPENSES AND DISBURSEMENTS (INCLUDING ATTORNEY COSTS) OF
ANY KIND OR NATURE WHATSOEVER WHICH MAY AT ANY TIME (INCLUDING AT ANY TIME FOLLOWING REPAYMENT OF
THE LOANS, THE TERMINATION OF THE LETTERS OF CREDIT AND THE TERMINATION, RESIGNATION OR REPLACEMENT
OF THE ADMINISTRATIVE AGENT OR REPLACEMENT OF ANY BANK) BE IMPOSED ON, INCURRED BY OR ASSERTED
AGAINST ANY SUCH PERSON IN ANY WAY RELATING TO OR ARISING OUT OF THIS AGREEMENT OR ANY DOCUMENT
CONTEMPLATED BY OR REFERRED TO HEREIN, OR THE TRANSACTIONS CONTEMPLATED HEREBY, OR ANY ACTION TAKEN
OR OMITTED BY ANY SUCH PERSON UNDER OR IN CONNECTION WITH ANY OF THE FOREGOING, INCLUDING WITH
RESPECT TO ANY INVESTIGATION, LITIGATION OR PROCEEDING (INCLUDING ANY INSOLVENCY PROCEEDING OR
APPELLATE PROCEEDING) RELATED TO OR ARISING OUT OF THIS AGREEMENT OR THE LOANS OR LETTERS OF CREDIT
OR THE USE OF THE PROCEEDS THEREOF, WHETHER OR NOT ANY INDEMNIFIED PERSON IS A PARTY THERETO (ALL
THE FOREGOING, COLLECTIVELY, THE "INDEMNIFIED LIABILITIES"); PROVIDED, HOWEVER, THAT THE BORROWER
SHALL HAVE NO OBLIGATION HEREUNDER TO ANY INDEMNIFIED PERSON FOR THAT PORTION OF ANY INDEMNIFIED
LIABILITIES THAT IS ADJUDGED BY A COURT OF COMPETENT JURISDICTION TO HAVE BEEN CAUSED BY THE GROSS
NEGLIGENCE OR WILLFUL MISCONDUCT OF SUCH INDEMNIFIED PERSON OR THAT PORTION OF ANY INDEMNIFIED
LIABILITIES WHICH ARE OWED BY AN INDEMNIFIED PERSON TO ANY OTHER INDEMNIFIED PERSON, BUT IN ALL
EVENTS, THE BORROWER SHALL REMAIN LIABLE FOR THE REMAINDER OF THE INDEMNIFIED LIABILITIES NOT SO
EXCLUDED. THE AGREEMENTS IN THIS SECTION SHALL SURVIVE PAYMENT OF ALL OTHER OBLIGATIONS.............. 74
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11.06 Payments Set Aside. To the extent that the Borrower makes a payment to the Agents or the Banks, or
the Agents or the Banks exercise their right of set-off, and such payment or the proceeds of such
set-off or any part thereof are subsequently invalidated, declared to be fraudulent or
preferential, set aside or required (including pursuant to any settlement entered into by the
Agents or such Bank in its discretion) to be repaid to a trustee, receiver or any other party, in
connection with any Insolvency Proceeding or otherwise, then (a) to the extent of such recovery the
obligation or part thereof originally intended to be satisfied shall be revived and continued in
full force and effect as if such payment had not been made or such set-off had not occurred, and
(b) each Bank severally agrees to pay to each of the Agents upon demand its pro rata share of any
amount so recovered from or repaid by the Agents...................................................... 75
11.07 Successors and Assigns. The provisions of this Agreement shall be binding upon and inure to the
benefit of the parties hereto and their respective successors and assigns, except that the Borrower
may not assign or transfer any of its rights or Obligations under this Agreement without the prior
written consent of the Agents and each Bank........................................................... 75
11.08 Assignments, Participations, Etc...................................................................... 75
11.09 Set-off. In addition to any rights and remedies of the Banks provided by law, if an Event of
Default exists or the Loans have been accelerated, each Bank is authorized at any time and from
time to time, without prior notice to the Borrower, any such notice being waived by the Borrower to
the fullest extent permitted by law, to set off and apply any and all deposits at any time held by,
and other indebtedness at any time owing by, such Bank to or for the credit or the account of the
Borrower against any and all Obligations owing to such Bank, now or hereafter existing,
irrespective of whether or not the Agents or such Bank shall have made demand under this Agreement
or any Loan Document and although such Obligations may be contingent or unmatured. Each Bank agrees
promptly to notify the Borrower and the Administrative Agent after any such set-off and application
made by such Bank; provided, however, that the failure to give such notice shall not affect the
validity of such set-off and application.............................................................. 77
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11.10 Automatic Debits of Fees. With respect to any letter of credit fee or other fee, interest or any
other cost or expense (including Attorney Costs) due and payable to the Agents, the Issuing Banks,
Fortis or BNP Paribas under the Loan Documents, the Borrower hereby irrevocably authorizes the
Collateral Agent to debit any deposit accounts of the Borrower with the Collateral Agent (such
deposit accounts being owned by the Collateral Agent and under the exclusive dominion and control
of the Collateral Agent) including the Bank Blocked Account in an amount such that the aggregate
amount debited from all such deposit accounts does not exceed such fee or other cost or expense.
If there are insufficient funds in such deposit accounts to cover the amount of the fee or other
cost or expense then due, such debits will be reversed (in whole or in part, in the Administrative
Agent's sole discretion) and such amount not debited shall be deemed to be unpaid. No such debit
under this Section shall be deemed a set-off.......................................................... 77
11.11 Notification of Addresses, Lending Offices, Etc. Each Bank shall notify the Agents in writing of
any changes in the address to which notices to the Bank should be directed, of addresses of any
Lending Office, of payment instructions in respect of all payments to be made to it hereunder and
of such other administrative information as the Agents shall reasonably request....................... 77
11.12 Bank Blocked Account Charges and Procedures. The Collateral Agent is hereby authorized to (a)
charge the Bank Blocked Account or any deposit account of the Borrower maintained at the Collateral
Agent for all returned checks, service charges, and other fees and charges associated with the
deposits by the Borrower to and withdrawals by the Borrower from the Bank Blocked Account; (b)
follow its usual procedures in the event the Bank Blocked Account or any check, draft or other
order for payment of money should be or become the subject of any writ, levy, order or other
similar judicial or regulatory order or process; (c) charge the Bank Blocked Account or any deposit
account of the Borrower maintained at the Collateral Agent for any Letter of Credit reimbursement,
Loan repayments, interest or fees; and (d) pay from the Bank Blocked Account, on behalf of the
Borrower, suppliers and other business expenses of the Borrower. If the available balances in the
Bank Blocked Account relating to the Borrower are not sufficient to pay the Administrative Agent
for any returned check, draft or order for the payment of money relating to the Borrower, or to
compensate the Administrative Agent for any charges or fees due the Administrative Agent with
respect to the deposits by the Borrower to and withdrawals by the Borrower from the Bank Blocked
Account, the Borrower agrees to pay on demand the amount due the Administrative Agent. The
Borrower agrees that it cannot, and will not, withdraw any monies from the Bank Blocked Account and
it will not permit the Bank Blocked Account to become subject to any other pledge, assignment,
lien, charge or encumbrance of any kind, nature or description, other than the Administrative
Agent's security interest............................................................................. 78
11.13 Counterparts. This Agreement may be executed in any number of separate counterparts, each of which,
when so executed, shall be deemed an original, and all of said counterparts taken together shall be
deemed to constitute but one and the same instrument.................................................. 78
11.14 Severability. The illegality or unenforceability of any provision of this Agreement or any
instrument or agreement required hereunder shall not in any way affect or impair the legality or
enforceability of the remaining provisions of this Agreement or any instrument or agreement
required hereunder.................................................................................... 78
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11.15 No Third Parties Benefited. This Agreement is made and entered into for the sole protection and
legal benefit of the Borrower, the Banks, the Administrative Agent and Agent-Related Persons, and
their permitted successors and assigns, and no other Person shall be a direct or indirect legal
beneficiary of, or have any direct or indirect cause of action or claim in connection with, this
Agreement or any of the other Loan Documents.......................................................... 78
11.16 GOVERNING LAW AND JURISDICTION........................................................................ 78
11.17 WAIVER OF JURY TRIAL. THE BORROWER, THE BANKS AND THE AGENTS EACH WAIVE THEIR RESPECTIVE RIGHTS TO
A TRIAL BY JURY OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING OUT OF OR RELATED TO THIS
AGREEMENT, THE OTHER LOAN DOCUMENTS, OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY, IN ANY
ACTION, PROCEEDING OR OTHER LITIGATION OF ANY TYPE BROUGHT BY ANY OF THE PARTIES AGAINST ANY OTHER
PARTY OR ANY AGENT-RELATED PERSON, PARTICIPANT OR ASSIGNEE, WHETHER WITH RESPECT TO CONTRACT
CLAIMS, TORT CLAIMS, OR OTHERWISE. THE BORROWER, THE BANKS AND THE ADMINISTRATIVE AGENT EACH AGREE
THAT ANY SUCH CLAIM OR CAUSE OF ACTION SHALL BE TRIED BY A COURT TRIAL WITHOUT A JURY. WITHOUT
LIMITING THE FOREGOING, THE PARTIES FURTHER AGREE THAT THEIR RESPECTIVE RIGHT TO A TRIAL BY JURY IS
WAIVED BY OPERATION OF THIS SECTION AS TO ANY ACTION, COUNTERCLAIM OR OTHER PROCEEDING WHICH SEEKS,
IN WHOLE OR IN PART, TO CHALLENGE THE VALIDITY OR ENFORCEABILITY OF THIS AGREEMENT OR THE OTHER
LOAN DOCUMENTS OR ANY PROVISION HEREOF OR THEREOF. THIS WAIVER SHALL APPLY TO ANY SUBSEQUENT
AMENDMENTS, RENEWALS, SUPPLEMENTS OR MODIFICATIONS TO THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS .... 79
11.18 DISCRETIONARY FACILITY. THE BORROWER ACKNOWLEDGES AND AGREES THAT THIS AGREEMENT PROVIDES FOR A
CREDIT FACILITY THAT IS COMPLETELY DISCRETIONARY ON THE PART OF THE BANKS AND THAT THE BANKS HAVE
ABSOLUTELY NO DUTY OR OBLIGATION TO ADVANCE ANY REVOLVING LOANS OR TO ISSUE ANY LETTER OF CREDIT.
THE BORROWER UNDERSTANDS THAT WITHOUT REASON, CAUSE OR PRIOR NOTICE, THE BANKS MAY CEASE ADVANCING
REVOLVING LOANS AND ISSUING LETTERS OF CREDIT AND MAKE DEMAND FOR PAYMENT OF ALL OBLIGATIONS OF
BORROWER TO THE BANKS AT ANY TIME. BORROWER REPRESENTS AND WARRANTS TO THE BANKS THAT BORROWER IS
AWARE OF THE RISKS ASSOCIATED WITH CONDUCTING BUSINESS UTILIZING AN UNCOMMITTED FACILITY.............. 79
11.19 Entire Agreement. THIS AGREEMENT, TOGETHER WITH THE OTHER LOAN DOCUMENTS, EMBODIES THE ENTIRE
AGREEMENT AND UNDERSTANDING AMONG THE BORROWER, THE BANKS AND THE ADMINISTRATIVE AGENT, AND
SUPERSEDES ALL PRIOR OR CONTEMPORANEOUS AGREEMENTS AND UNDERSTANDINGS OF SUCH PERSONS, VERBAL OR
WRITTEN, RELATING TO THE SUBJECT MATTER HEREOF AND THEREOF............................................ 80
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11.20 Effect of Amendment and Restatement. On the Closing Date, the Original Credit Agreement shall be
amended, restated and superseded in its entirety by this Agreement. The parties hereto acknowledge
and agree that the liens and security interests granted under the Security Agreements (as defined
in the Original Credit Agreement) are continuing and in full force and effect and, upon the
amendment and restatement of the Original Credit Agreement pursuant to this Agreement, such liens
and security interests secure and continue to secure the payment of the Obligations, and that the
Notes outstanding under and as defined in the Original Credit Agreement are, upon the Closing Date,
replaced by the Notes issued hereunder................................................................ 80
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