EXHIBIT 10.1
THIRD AMENDED AND RESTATED CREDIT AGREEMENT
DATED AS OF MAY 25, 2004
AMONG
TESORO PETROLEUM CORPORATION,
AS BORROWER
THE FINANCIAL INSTITUTIONS FROM TIME TO TIME PARTIES HERETO,
AS LENDERS
BANK OF AMERICA, N.A.,
AS SYNDICATION AGENT
▇▇▇▇▇ FARGO FOOTHILL, LLC,
AS DOCUMENTATION AGENT
BANK ONE, NA (MAIN OFFICE CHICAGO)
AND
BANK OF AMERICA, N.A.,
AS CO-COLLATERAL AGENTS
AND
BANK ONE, NA (MAIN OFFICE CHICAGO),
AS ADMINISTRATIVE AGENT
--------------------------------------------------------------------------------
BANC ONE CAPITAL MARKETS, INC.,
AS SOLE LEAD ARRANGER AND SOLE BOOK RUNNER
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SIDLEY ▇▇▇▇▇▇ ▇▇▇▇▇ & ▇▇▇▇ LLP
Bank One Plaza
▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
TABLE OF CONTENTS
ARTICLE I DEFINITIONS............................................................................................... 1
1.1. Certain Defined Terms....................................................................................... 1
1.2. Plural Forms................................................................................................ 31
ARTICLE II THE CREDITS............................................................................................... 31
2.1. Commitments; Loans.......................................................................................... 31
2.2. Required Payments; Termination.............................................................................. 33
2.3. Ratable Loans; Types of Advances............................................................................ 35
2.4. Commitment Fee; Aggregate Revolving Loan Commitment......................................................... 35
2.5. Minimum Amount of Each Advance.............................................................................. 36
2.6. Optional Principal Payments; Optional Reductions of the Aggregate Pre-Funded Letter of Credit Commitment.... 36
2.7. Method of Selecting Types and Interest Periods for New Advances............................................. 37
2.8. Conversion and Continuation of Outstanding Advances; No Conversion or Continuation of Eurodollar
Advances After Default...................................................................................... 37
2.9. Changes in Interest Rate, etc............................................................................... 38
2.10. Rates Applicable After Default.............................................................................. 38
2.11. Method of Payment; Settlement............................................................................... 39
2.12. Noteless Agreement; Evidence of Indebtedness................................................................ 41
2.13. Telephonic Notices.......................................................................................... 42
2.14. Payments of Interest........................................................................................ 42
2.15. Notification of Advances, Interest Rates, Prepayments and Revolving Loan Commitment Reductions;
Availability of Loans....................................................................................... 44
2.16. Lending Installations....................................................................................... 44
2.17. Non-Receipt of Funds by the Agent........................................................................... 45
2.18. Replacement of Lender....................................................................................... 45
2.19. Facility LCs................................................................................................ 46
2.20. Increase of Aggregate Revolving Loan Commitment............................................................. 53
ARTICLE III YIELD PROTECTION; TAXES................................................................................... 54
3.1. Yield Protection............................................................................................ 54
3.2. Changes in Capital Adequacy Regulations..................................................................... 55
3.3. Availability of Types of Advances........................................................................... 55
3.4. Funding Indemnification..................................................................................... 55
3.5. Taxes....................................................................................................... 55
3.6. Lender Statements; Survival of Indemnity.................................................................... 57
3.7. Alternative Lending Installation............................................................................ 58
ARTICLE IV CONDITIONS PRECEDENT...................................................................................... 58
4.1. Effectiveness of Revolving Loan Commitments and Pre-Funded Letter of Credit Commitments..................... 58
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4.2. Each Credit Extension....................................................................................... 60
ARTICLE V REPRESENTATIONS AND WARRANTIES............................................................................ 60
5.1. Existence and Standing...................................................................................... 60
5.2. Authorization and Validity.................................................................................. 61
5.3. No Conflict; Government Consent............................................................................. 61
5.4. Financial Statements........................................................................................ 61
5.5. Material Adverse Change..................................................................................... 61
5.6. Taxes....................................................................................................... 62
5.7. Litigation and Contingent Obligations....................................................................... 62
5.8. Subsidiaries................................................................................................ 62
5.9. ERISA....................................................................................................... 62
5.10. Accuracy of Information..................................................................................... 62
5.11. Regulation U................................................................................................ 62
5.12. Material Agreements......................................................................................... 63
5.13. Compliance With Laws........................................................................................ 63
5.14. Ownership of Properties..................................................................................... 63
5.15. Plan Assets; Prohibited Transactions........................................................................ 63
5.16. Environmental Matters....................................................................................... 63
5.17. Investment Company Act...................................................................................... 63
5.18. Public Utility Holding Company Act.......................................................................... 64
5.19. Insurance................................................................................................... 64
5.20. No Default or Unmatured Default............................................................................. 64
ARTICLE VI COVENANTS................................................................................................. 64
6.1. Financial Reporting......................................................................................... 64
6.2. Use of Proceeds............................................................................................. 67
6.3. Notice of Default........................................................................................... 67
6.4. Conduct of Business......................................................................................... 67
6.5. Taxes....................................................................................................... 68
6.6. Insurance................................................................................................... 68
6.7. Compliance with Laws........................................................................................ 68
6.8. Maintenance of Properties................................................................................... 68
6.9. Inspection; Keeping of Books and Records.................................................................... 69
6.10. Restricted Payments......................................................................................... 69
6.11. Merger...................................................................................................... 69
6.12. Sale of Assets.............................................................................................. 70
6.13. Investments and Acquisitions................................................................................ 70
6.14. Indebtedness................................................................................................ 72
6.15. Liens; Negative Pledge...................................................................................... 73
6.16. Affiliates.................................................................................................. 75
6.17. Financial Contracts......................................................................................... 76
6.18. Subsidiary Covenants........................................................................................ 76
6.19. Contingent Obligations...................................................................................... 76
6.20. Amendments to Agreements.................................................................................... 76
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6.21. Fixed Charge Coverage Ratio................................................................................. 77
6.22. Minimum Consolidated Tangible Net Worth..................................................................... 77
6.23. Subsidiary Collateral Documents; Subsidiary Guarantors...................................................... 77
6.24. Insurance and Condemnation Proceeds......................................................................... 78
6.25. Collection Accounts......................................................................................... 78
6.26. Subordinated Indebtedness................................................................................... 79
6.27. Multiemployer Plans......................................................................................... 79
6.28. Consolidated Capital Expenditures........................................................................... 79
ARTICLE VII DEFAULTS.................................................................................................. 79
ARTICLE VIII ACCELERATION, WAIVERS, AMENDMENTS AND REMEDIES............................................................ 82
8.1. Acceleration.................................................................................................. 82
8.2. Amendments.................................................................................................... 83
8.3. Preservation of Rights........................................................................................ 84
ARTICLE IX GENERAL PROVISIONS........................................................................................ 85
9.1. Survival of Representations................................................................................... 85
9.2. Governmental Regulation....................................................................................... 85
9.3. Headings...................................................................................................... 85
9.4. Entire Agreement.............................................................................................. 85
9.5. Several Obligations; Benefits of this Agreement............................................................... 85
9.6. Expenses; Indemnification..................................................................................... 85
9.7. Numbers of Documents.......................................................................................... 86
9.8. Accounting.................................................................................................... 86
9.9. Severability of Provisions.................................................................................... 87
9.10.Nonliability of Lenders....................................................................................... 87
9.11.Confidentiality............................................................................................... 87
9.12.Lenders Not Utilizing Plan Assets............................................................................. 87
9.13.Nonreliance................................................................................................... 88
9.14.Disclosure.................................................................................................... 88
9.15.Performance of Obligations.................................................................................... 88
9.16.Partial Guaranty Release...................................................................................... 89
9.17.Subordination of Intercompany Indebtedness.................................................................... 89
9.18.Certifications Regarding Indentures........................................................................... 90
9.19.Co-Agents..................................................................................................... 91
ARTICLE X THE AGENT................................................................................................. 91
10.1. Appointment; Nature of Relationship......................................................................... 91
10.2. Powers...................................................................................................... 91
10.3. General Immunity............................................................................................ 91
10.4. No Responsibility for Loans, Recitals, etc.................................................................. 92
10.5. Action on Instructions of Lenders........................................................................... 92
10.6. Employment of Agents and Counsel............................................................................ 92
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10.7. Reliance on Documents; Counsel.............................................................................. 92
10.8. Agent's Reimbursement and Indemnification................................................................... 92
10.9. Notice of Default........................................................................................... 93
10.10. Rights as a Lender.......................................................................................... 93
10.11. Lender Credit Decision...................................................................................... 93
10.12. Successor Agent............................................................................................. 94
10.13. Agent and Arranger Fees..................................................................................... 94
10.14. Delegation to Affiliates.................................................................................... 94
10.15. Collateral Documents........................................................................................ 94
10.16. Intercreditor Agreement..................................................................................... 95
ARTICLE XI SETOFF; RATABLE PAYMENTS.................................................................................. 97
11.1. Setoff...................................................................................................... 97
11.2. Ratable Payments............................................................................................ 97
11.3. Application of Payments..................................................................................... 97
ARTICLE XII BENEFIT OF AGREEMENT; ASSIGNMENTS; PARTICIPATIONS......................................................... 98
12.1. Successors and Assigns; Designated Lenders.................................................................. 98
12.2. Participations.............................................................................................. 100
12.3. Assignments................................................................................................. 101
12.4. Dissemination of Information................................................................................ 103
12.5. Tax Certifications.......................................................................................... 103
ARTICLE XIII NOTICES................................................................................................... 103
13.1. Notices..................................................................................................... 103
13.2. Change of Address........................................................................................... 103
ARTICLE XIV COUNTERPARTS.............................................................................................. 103
ARTICLE XV CHOICE OF LAW; CONSENT TO JURISDICTION; WAIVER OF JURY TRIAL.............................................. 104
ARTICLE XVI PRIOR CREDIT AGREEMENT.................................................................................... 105
ARTICLE XVII USA PATRIOT ACT NOTIFICATION.............................................................................. 105
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SCHEDULES
Commitment Schedule
Pricing Schedule
Schedule 1.1 - Eligible Carriers
Schedule 2.19.1 - Letters of Credit Issued Under Prior Credit Agreement
Schedule 5.8 - Subsidiaries
Schedule 6.13 - Investments
Schedule 6.14 - Indebtedness
Schedule 6.15 - Liens
EXHIBITS
Exhibit A - Form of Borrower's Counsel's Opinion
Exhibit B - Form of Compliance Certificate
Exhibit C - Form of Assignment and Assumption Agreement
Exhibit D - Form of Loan/Credit Related Money Transfer Instruction
Exhibit E - Form of Revolving Note (if requested)
Exhibit F - Form of Designation Agreement
Exhibit G - Form of Officer's Certificate
Exhibit H - List of Closing Documents
Exhibit I - Form of Intercreditor Agreement
Exhibit J-1 - Form of Interim Collateral Report
Exhibit J-2 - Form of Monthly Collateral Report
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THIRD AMENDED AND RESTATED CREDIT AGREEMENT
This Third Amended and Restated Credit Agreement, dated as of May 25,
2004, is entered into by and among Tesoro Petroleum Corporation, a Delaware
corporation, the Lenders, the LC Issuers, and Bank One, NA, a national banking
association having its principal office in Chicago, Illinois, as Administrative
Agent. The parties hereto agree as follows:
ARTICLE I
DEFINITIONS
1.1. Certain Defined Terms. As used in this Agreement:
"Accounting Changes" is defined in Section 9.8 hereof.
"Account Debtor" means the account debtor or obligor with respect to any
of the Receivables and/or the prospective purchaser with respect to any contract
right, and/or any party who enters into or proposes to enter into any contract
or other arrangement with the Borrower or any Subsidiary.
"Acquisition" means any transaction, or any series of related
transactions, consummated on or after the Closing Date, by which the Borrower or
any of its Subsidiaries (i) acquires any going business or all or substantially
all of the assets of any firm, corporation or limited liability company, or
division thereof, whether through purchase of assets, merger or otherwise or
(ii) directly or indirectly acquires (in one transaction or as the most recent
transaction in a series of transactions) at least a majority (in number of
votes) of the securities of a corporation which have ordinary voting power for
the election of directors (other than securities having such power only by
reason of the happening of a contingency) or a majority (by percentage of voting
power) of the outstanding ownership interests of a partnership or limited
liability company of any Person.
"Advance" means a borrowing hereunder consisting of the aggregate amount
of several Loans (i) made by some or all of the Lenders on the same Borrowing
Date, or (ii) converted or continued by the Lenders on the same date of
conversion or continuation, consisting, in either case, of the aggregate amount
of the several Loans of the same Type and, in the case of Eurodollar Loans, for
the same Interest Period. The term "Advance" shall, unless otherwise indicated,
include Non-Ratable Loans and Collateral Protection Advances.
"Affiliate" of any Person means any other Person directly or indirectly
controlling, controlled by or under common control with such Person. A Person
shall be deemed to control another Person if the controlling Person is the
"beneficial owner" (as defined in Rule 13d-3 under the Securities Exchange Act
of 1934) of 10% or more of any class of voting securities (or other ownership
interests) of the controlled Person or possesses, directly or indirectly, the
power to direct or cause the direction of the management or policies of the
controlled Person, whether through ownership of voting securities, by contract
or otherwise.
"Agent" means Bank One in its capacity as contractual representative of
the Lenders pursuant to Article X, and not in its individual capacity as a
Lender, as Administrative Agent, and any successor Agent appointed pursuant to
Article X.
"Aggregate Credit Linked Deposit" means, at any time, the aggregate of the
Credit Linked Deposits, which aggregate amount shall equal $100,000,000 as of
the Closing Date and which aggregate amount may be reduced from time to time
pursuant to the terms of this Agreement.
"Aggregate Outstanding Credit Exposure" means, at any time, the aggregate
of the Outstanding Credit Exposure of all the Lenders.
"Aggregate Outstanding Pre-Funded Letter of Credit Exposure" means, at any
time, the aggregate of the Outstanding Pre-Funded Letter of Credit Exposure of
all the Lenders.
"Aggregate Outstanding Revolving Loan Credit Exposure" means, at any time,
the aggregate of the Outstanding Revolving Loan Credit Exposures of all the
Lenders.
"Aggregate Pre-Funded Letter of Credit Commitment" means the aggregate of
the Pre-Funded Letter of Credit Commitments of all the Lenders, which aggregate
amount equals One Hundred Million and 00/100 Dollars ($100,000,000) as of the
Closing Date.
"Aggregate Revolving Loan Commitment" means the aggregate of the Revolving
Loan Commitments of all the Lenders, as increased or reduced from time to time
pursuant to the terms hereof. The initial Aggregate Revolving Loan Commitment is
Five Hundred Fifty Million and 00/100 Dollars ($550,000,000).
"Agreement" means this Third Amended and Restated Credit Agreement, as it
may be amended, restated, supplemented or otherwise modified and as in effect
from time to time.
"Agreement Accounting Principles" means US GAAP, applied in a manner
consistent with that used in preparing the financial statements of the Borrower
referred to in Section 5.4; provided, however, that except as provided in
Section 9.8, with respect to the calculation of the financial covenants set
forth in Sections 6.21 and 6.22 (and the defined terms used in such Sections),
"Agreement Accounting Principles" means US GAAP as in effect in the United
States as of the Closing Date, applied in a manner consistent with that used in
preparing the financial statements of the Borrower referred to in Section 5.4
hereof.
"Alternate Base Rate" means, for any day, a fluctuating rate of interest
per annum equal to the higher of (i) the Prime Rate for such day and (ii) the
sum of (a) the Federal Funds Effective Rate for such day and (b) one-half of one
percent (0.5%) per annum.
"Applicable Fee Rate" means, with respect to the Commitment Fee at any
time, the percentage rate per annum which is applicable at such time with
respect to such fee as set forth in the Pricing Schedule.
"Applicable Margin" means, with respect to Advances of any Type at any
time, the percentage rate per annum which is applicable at such time with
respect to Advances of such Type consisting of Revolving Loans as set forth in
the Pricing Schedule.
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"Approved Fund" means any Fund that is administered or managed by (a) a
Lender, (b) an Affiliate of a Lender or (c) an entity or an Affiliate of an
entity that administers or manages a Lender.
"Arranger" means Banc One Capital Markets, Inc., a Delaware corporation,
and its successors, in its capacity as Sole Lead Arranger and Sole Book Runner.
"Article" means an article of this Agreement unless another document is
specifically referenced.
"Assignment Agreement" is defined in Section 12.3.1.
"Authorized Officer" means any of the chief executive officer, president,
chief operating officer, chief financial officer, treasurer, vice
president-finance or vice president-controller of the Borrower, acting singly.
"Available Aggregate Revolving Loan Commitment" means, at any time, the
lesser of (i) the Aggregate Revolving Loan Commitment and (ii) the Borrowing
Base then in effect, minus the Aggregate Outstanding Revolving Loan Credit
Exposure at such time.
"Bank One" means Bank One, NA, a national banking association having its
principal office in Chicago, Illinois, in its individual capacity, and its
successors.
"Bank Products" means, with respect to any Lender, any of the following
services provided to the Borrower or an Affiliate thereof by any Lender or the
Agent: (i) Rate Management Transactions, (ii) commercial credit card services,
(iii) cash management and other treasury management services (including, without
limitation, controlled disbursements, automated clearinghouse transactions,
return items, and interstate depository network services), and (iv) foreign
exchange related services.
"Borrower" means Tesoro Petroleum Corporation, a Delaware corporation, and
its permitted successors and assigns (including, without limitation, a debtor in
possession on its behalf).
"Borrowing Base" means, as of any date of calculation, an amount equal to
the lesser of (x) the Aggregate Revolving Loan Commitment plus the Aggregate
Pre-Funded Letter of Credit Commitment, and (y) as set forth on the most current
Interim Collateral Report or Monthly Collateral Report, as applicable, delivered
to the Agent, the aggregate of (i) 100% of Perfected Cash Interests, plus (ii)
eighty-five percent (85%) of the Gross Amount of Eligible Receivables, plus
(iii) eighty percent (80%) of the Gross Amount of Eligible Petroleum Inventory,
minus (iv) the Rental Reserve, minus (v) the Standard Reserve, and minus (vi)
such reserves as the Agent may from time to time reasonably deem appropriate;
provided, however, that the Agent, upon the occurrence and during the
continuance of a Default, may, in its reasonable discretion and without the
Borrower's consent, decrease the foregoing percentages.
"Borrowing Date" means a date on which an Advance is made hereunder.
"Borrowing Notice" is defined in Section 2.7.
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"Business Activity Report" means (A) a Notice of Business Activities
Report filed with the State of Minnesota, Department of Revenue or (B) any
similar report required by any other State relating to the ability of the
Borrower or any Subsidiary Guarantor to enforce its Receivables claims against
Account Debtors located in any such state.
"Business Day" means (i) with respect to any borrowing, payment or rate
selection of Eurodollar Advances, a day (other than a Saturday or Sunday) on
which banks generally are open in Chicago, Illinois and New York, New York for
the conduct of substantially all of their commercial lending activities,
interbank wire transfers can be made on the Fedwire system and dealings in
Dollars are carried on in the London interbank market and (ii) for all other
purposes, a day (other than a Saturday or Sunday) on which banks generally are
open in Chicago, Illinois and New York, New York for the conduct of
substantially all of their commercial lending activities and interbank wire
transfers can be made on the Fedwire system.
"Capitalized Lease" of a Person means any lease of Property by such Person
as lessee which would be capitalized on a balance sheet of such Person prepared
in accordance with Agreement Accounting Principles.
"Capitalized Lease Obligations" of a Person means the amount of the
obligations of such Person under Capitalized Leases which would be shown as a
liability on a balance sheet of such Person prepared in accordance with
Agreement Accounting Principles.
"Cash Equivalent Investments" means (i) short-term obligations of, or
fully guaranteed by, the United States of America, (ii) commercial paper rated
A-1 or better by S&P or P-1 or better by ▇▇▇▇▇'▇, (iii) demand deposit accounts
maintained in the ordinary course of business, and (iv) certificates of deposit
issued by and time deposits with commercial banks (whether domestic or foreign)
having capital and surplus in excess of $100,000,000; provided in each case that
the same provides for payment of both principal and interest (and not principal
alone or interest alone) and is not subject to any contingency regarding the
payment of principal or interest.
"Change in Control" means the occurrence of any of the following events:
(i) there shall be consummated (A) any consolidation or merger of the Borrower
in which the Borrower is not the continuing or surviving corporation or pursuant
to which shares of the Borrower's common stock would be converted into cash,
securities or other property, other than a merger of the Borrower where a
majority of the Board of Directors of the surviving corporation are, and for a
two year period after the merger continue to be, persons who were directors of
the Borrower immediately prior to such merger or were elected as directors, or
nominated for election as directors, by a vote of at least two-thirds of the
directors then still in office who were directors of the Borrower immediately
prior to such merger, or (B) any sale, lease, exchange or transfer (in one
transaction or a series of transactions) of all or substantially all of the
assets of the Borrower, unless, immediately following such sale, lease, exchange
or transfer, such assets are owned, directly or indirectly, by the Borrower or
one or more Subsidiaries of the Borrower; (ii) the shareholders of the Borrower
shall approve any plan or proposal for the liquidation or dissolution of the
Borrower; (iii) (A) any "person" as defined in the Securities Exchange Act of
1934 (the "Exchange Act"), other than the Borrower or a Subsidiary or any
employee benefit plan sponsored by the Borrower or a Subsidiary, shall become
the beneficial owner (within the
4
meaning of Rule 13d-3 under the Exchange Act) of securities of the Borrower
representing 50% or more of the combined voting power of the Borrower's then
outstanding securities ordinarily (and apart from rights accruing in special
circumstances) having the right to vote in the election of directors, as a
result of a tender or exchange offer, open market purchases, privately
negotiated purchases or otherwise, and (B) at any time during a period of two
consecutive years thereafter, individuals who immediately prior to the beginning
of such period constituted the Board of Directors of the Borrower shall cease
for any reason to constitute at least a majority thereof, unless the election or
the nomination by the Board of Directors for election by the Borrower's
shareholders of each new director during such period was approved by a vote of
at least two-thirds of the directors then still in office who were directors at
the beginning of such period; or (iv) a "Change of Control" or like event under
any agreement, document or instrument evidencing Material Indebtedness.
"Closing Date" means May 25, 2004.
"Co-Agent" means each of Bank of America, N.A., as syndication agent and
as co-collateral agent, Bank One, as co-collateral agent, and ▇▇▇▇▇ Fargo
Foothill, LLC, as documentation agent, together with their respective successors
and assigns.
"Code" means the Internal Revenue Code of 1986, as amended, reformed or
otherwise modified from time to time, and any rule or regulation issued
thereunder.
"Collateral" means all property and interests in property now owned or
hereafter acquired by the Borrower or any of its Subsidiary Guarantors in or
upon which a security interest or lien is granted to the Agent, for the benefit
of the Holders of Secured Obligations, or to the Agent, for the benefit of the
Lenders, whether under the Security Agreement, under any of the other Collateral
Documents or under any of the other Loan Documents.
"Collateral Documents" means all agreements, instruments and documents
executed in connection with this Agreement that are intended to create or
evidence Liens to secure the Secured Obligations, including, without limitation,
the Security Agreement and all other security agreements, loan agreements,
notes, guarantees, subordination agreements, pledges, powers of attorney,
consents, assignments, contracts, fee letters, notices, leases, financing
statements and all other written matter whether heretofore, now, or hereafter
executed by or on behalf of the Borrower or any of its Subsidiary Guarantors and
delivered to the Agent or any of the Lenders, together with all agreements and
documents referred to therein or contemplated thereby.
"Collateral Protection Advance" is defined in Section 2.1.2.
"Collateral Shortfall Amount" is defined in Section 8.1.
"Collection Account" is defined in Section 6.25.
"Commitment Fee" is defined in Section 2.4.1.
"Commitment Schedule" means the Schedule identifying the Lenders'
respective Revolving Loan Commitments as of the Closing Date and the Lenders'
respective Pre-Funded Letter of Credit Commitments as of the Closing Date, as
attached hereto and identified as such.
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"Consolidated Capital Expenditures" means, for any period, with respect to
the Borrower and its Subsidiaries, the aggregate of all expenditures by the
Borrower and its Subsidiaries for the acquisition or leasing (pursuant to a
Capitalized Lease) of fixed or capital assets or additions to equipment
(including replacements, capitalized repairs, and improvements during such
period) which are capitalized under Agreement Accounting Principles on the
Borrower's or any Subsidiary's balance sheet.
"Consolidated EBITDA" means Consolidated Net Income plus, to the extent
deducted from revenues in determining Consolidated Net Income, (i) Consolidated
Interest Expense, (ii) income and franchise tax expense, (iii) depreciation,
(iv) amortization and (v) any other non-cash charges, minus, to the extent
included in Consolidated Net Income, (i) interest income (except to the extent
deducted in determining Consolidated Interest Expense) and (ii) any other
non-cash income, all reported for the Borrower and its Subsidiaries on a
consolidated basis.
"Consolidated Interest Expense" means, with reference to any period, the
accrued interest expense of the Borrower and its Subsidiaries reported on a
consolidated basis for such period, including, without limitation, yield or any
other financing costs resembling interest which are payable under any
Receivables Purchase Facility.
"Consolidated Net Income" means, with reference to any period, the
consolidated net earnings (or loss) of the Borrower and its Subsidiaries
reported for such period.
"Consolidated Tangible Net Worth" means at any time, with respect to any
Person, the consolidated total stockholders' equity of such Person and its
Subsidiaries reported on a consolidated basis in accordance with Agreement
Accounting Principles and as reported in such Person's most recent Form 10-K or
Form 10-Q filing, as applicable, with the U.S. Securities and Exchange
Commission, minus at all times all items that are reported in such Form 10-K or
Form 10-Q filing, as applicable, as "acquired intangibles net" and "goodwill."
"Contingent Obligation" of a Person means any agreement, undertaking or
arrangement by which such Person assumes, guarantees, endorses, contingently
agrees to purchase or provide funds for the payment of, or otherwise becomes or
is contingently liable upon, the obligation or liability of any other Person, or
agrees to maintain the net worth or working capital or other financial condition
of any other Person, or otherwise assures any creditor of such other Person
against loss; provided, however, that amounts held or allocated as reserves for
obligations arising under or in connection with (i) any Plan or other pension
fund related item, (ii) litigation, judgments and legal proceedings, and (iii)
compliance with Environmental Laws, including, without limitation, the
remediation of any environmental related issues with respect to its Property,
shall not constitute "Contingent Obligations."
"Continuing Director" means, with respect to any Person as of any date of
determination, any member of the board of directors of such Person who (i) was a
member of such board of directors on the Closing Date, or (ii) was nominated for
election or elected to such board of directors with the approval of the required
majority of the Continuing Directors who were members of such board at the time
of such nomination or election; provided that any individual who is so elected
or nominated in connection with a merger, consolidation, acquisition or similar
6
transaction shall not be a Continuing Director unless such individual was a
Continuing Director prior thereto.
"Controlled Group" means all members of a controlled group of corporations
or other business entities and all trades or businesses (whether or not
incorporated) under common control which, together with the Borrower or any of
its Subsidiaries, are treated as a single employer under Section 414 of the
Code.
"Conversion/Continuation Notice" is defined in Section 2.8.
"Conversion Event" means the occurrence of a Default, including, without
limitation, the Borrower's failure to deposit into the Pre-Funded Letter of
Credit Account a Pre-Funded Account Reimbursement Amount when required pursuant
to Section 2.19.6.
"Credit Extension" means the making of an Advance or the issuance of a
Facility LC.
"Credit Extension Date" means the Borrowing Date for an Advance or the
issuance date for a Facility LC.
"Credit Linked Deposit" means, for any Lender, the amount required to be
deposited by such Lender into the Pre-Funded Letter of Credit Account on the
Closing Date or when such Lender otherwise becomes party to this Agreement,
which amount (i) shall equal such Lender's Pre-Funded Letter of Credit
Commitment on the date on which such Lender becomes subject hereto, and (ii) may
be reduced from time to time pursuant to the terms of this Agreement.
"Current Petroleum Inventory Market Price" means, with respect to any
Petroleum Inventory, the market price for such Petroleum Inventory as set forth
in a published or reported price index maintained by a third-party that is not
an Affiliate of the Borrower and that prepares such index in the ordinary course
of its business or such other price as the Agent may ascribe thereto in its
reasonable credit judgment. Current Petroleum Inventory Market Price shall be
determined using published or reported price indices created or distributed by
Oil Price Information Service, commonly known as OPIS, and/or Platts Oilgram
Price Report, commonly known as Platts. In the event OPIS or Platts no longer
provides the aforementioned price indices, or in the event the Borrower and the
Agent determine that either OPIS or Platts no longer accurately provides pricing
information for Petroleum Inventory, the Borrower and the Agent shall replace
one or both of the OPIS and Platts price indices, as applicable, with other
third-party price indices reasonably acceptable to each of the Borrower and the
Agent.
"Default" means an event described in Article VII.
"Designated Lender" means, with respect to each Designating Lender, each
Eligible Designee designated by such Designating Lender pursuant to Section
12.1.2.
"Designating Lender" means, with respect to each Designated Lender, the
Lender that designated such Designated Lender pursuant to Section 12.1.2.
"Designation Agreement" is defined in Section 12.1.2.
7
"Dollar", "dollar" and "$" means the lawful currency of the United States
of America.
"Eligible Carrier" means any of the carriers and pipeline companies listed
or described in Schedule 1.1 to this Agreement, as such Schedule 1.1 may be
revised by the Borrower from time to time with the consent of the Agent, such
consent not to be unreasonably withheld.
"Eligible Designee" means a special purpose corporation, partnership,
trust, limited partnership or limited liability company that is administered by
the respective Designating Lender or an Affiliate of such Designating Lender and
(i) is organized under the laws of the United States of America or any state
thereof, (ii) is engaged primarily in making, purchasing or otherwise investing
in commercial loans in the ordinary course of its business and (iii) issues (or
the parent of which issues) commercial paper rated at least A-1 or the
equivalent thereof by S&P or P-1 or the equivalent thereof by ▇▇▇▇▇'▇.
"Eligible Petroleum Inventory" means Petroleum Inventory of the Borrower
and the Subsidiary Guarantors which is held for sale or lease in the ordinary
course of business or furnished under any contract of service by the Borrower or
such Subsidiary Guarantors in the ordinary course of business which is at all
times and shall continue to meet standards of eligibility from time to time
established in accordance with this Agreement. Initially, standards of
eligibility will be established by the Agent in its reasonable credit judgment
(which credit judgment shall be exercised in a manner that is not arbitrary or
capricious) and may be revised from time to time by the Agent in its reasonable
credit judgment (which credit judgment shall be exercised in a manner that is
not arbitrary or capricious). In general, without limiting the foregoing, the
following Petroleum Inventory includes Eligible Petroleum Inventory:
(a)(i) Petroleum Inventory that is subject to a valid, first
priority perfected lien and security interest in favor of the Agent on behalf of
the Holders of Secured Obligations or (ii) Petroleum Inventory that has been
delivered to an Eligible Carrier subject to a valid, first priority perfected
lien and security interest in favor of the Agent on behalf of the Holders of
Secured Obligations with UCC financing statements (or any other applicable form)
perfecting or continuing the perfection of the security interest of the Agent on
behalf of the Holders of Secured Obligations in such Petroleum Inventory having
been duly filed where necessary and either (x) no document of title is issued
with respect to such Petroleum Inventory by such Eligible Carrier, or (y) if a
document of title is issued with respect to such Petroleum Inventory by such
Eligible Carrier, the original of such document of title is delivered to the
Agent or its designated bailee or agent,
(b)Petroleum Inventory that is in good saleable condition, is not
deteriorating in quality and is not obsolete, and is of a quality which (in
locations where sold by the Borrower) is marketable at prevailing market prices
for such products and meets all applicable governmental regulations and
standards at the place of intended sale,
(c)Petroleum Inventory that is owned by the Borrower or its Subsidiaries
(provided all documentation necessary to provide the Agent with a first
priority, perfected Lien thereon shall be in full force and effect) or, in the
case of Petroleum Inventory described in clause (ii) of paragraph (a) above, the
Borrower has the absolute and unconditional right to obtain such Petroleum
Inventory or Petroleum Inventory equivalent to such Petroleum Inventory from an
8
Eligible Carrier, in each case, free and clear of any and all Liens whatsoever,
other than those (1) in favor of the Agent on behalf of the Holders of Secured
Obligations created pursuant to the Collateral Documents and (2) those in favor
of an Eligible Carrier that arise under applicable law and for which appropriate
amounts have been allocated under the Rental Reserve,
(d)Petroleum Inventory that is (1) located at a location owned by
the Borrower or a Subsidiary Guarantor, (2) delivered to an Eligible Carrier
under an arrangement described in clause (ii) of paragraph (a) above, or (3)
located at a location leased by the Borrower or a Subsidiary Guarantor so long
as such location is either subject to a Third Party Agreement or such location
is subject to the Rental Reserve;
(e)Petroleum Inventory that is not commingled with Petroleum Inventory of
any Person other than the Borrower and/or its Subsidiaries or has been delivered
to an Eligible Carrier under an arrangement described in clause (ii) of
paragraph (a) above,
(f)Petroleum Inventory that is in full conformity with the representations
and warranties made by the Borrower or a Subsidiary Guarantor to the Agent with
respect thereto whether contained in this Agreement or the Security Agreement,
and
(g)To the extent Petroleum Inventory is in transit on the high seas
to or from a non-Affiliate, (1) it does not constitute a Receivable, (2) if
purchased with a Letter of Credit, a copy of such Letter of Credit has been
delivered to the Agent, (3) it is covered by insurance in form and substance
reasonably acceptable to the Agent, and (4) all applicable documents of title
have been delivered to the Agent; provided, however, that with respect to the
high seas Petroleum Inventory described in this clause (g), the amount of such
high seas Petroleum Inventory on any date of determination in excess of 15% of
the aggregate amount of all Petroleum Inventory then owned by the Borrower and
its Subsidiary Guarantors on such date of determination shall not constitute
Eligible Petroleum Inventory.
Notwithstanding anything to the contrary set forth in this Agreement or any
other Loan Document, no Petroleum Inventory located, stored or maintained at any
retail service station or in a railroad car, or otherwise in transit upon a
railway system, shall constitute Eligible Petroleum Inventory.
"Eligible Receivables" means Receivables created by the Borrower or any
Subsidiary Guarantor, in each case in the ordinary course of its business
arising out of the sale of goods or rendition of services by the Borrower or
such Subsidiary Guarantor, which Receivables are and at all times shall continue
to meet standards of eligibility from time to time reasonably established in
accordance with this Agreement. Initially, standards of eligibility will be
established by the Agent in its reasonable credit judgment (which credit
judgment shall be exercised in a manner that is not arbitrary or capricious) and
may be revised from time to time by the Agent in its reasonable credit judgment
(which credit judgment shall be exercised in a manner that is not arbitrary or
capricious). In general, without limiting the foregoing, the following
Receivables are not Eligible Receivables:
(a) Receivables which remain unpaid sixty (60) days after the date on
which payment was due or ninety (90) days after the date of the original
applicable invoice;
9
(b) Receivables on any date of determination which are owing by an Account
Debtor and its Affiliates to the extent that the aggregate amount of Receivables
owing by such Account Debtor and its Affiliates to the Borrower or any
Subsidiary Guarantor exceeds 15% times the aggregate amount of all Eligible
Receivables on such date;
(c) all Receivables owing by a single Account Debtor (including
Receivables which remain unpaid fewer than sixty (60) days after the date on
which payment was due or ninety (90) days after the date of the original
applicable invoice) if fifty percent (50%) of the aggregate balance owing by
such Account Debtor, calculated without taking into account any credit balances
of such Account Debtor, remains unpaid ninety (90) days after the date of the
original applicable invoice or has otherwise become, or has been determined by
the Agent to be ineligible in accordance with the provisions of this definition;
(d) Receivables with respect to which the Account Debtor is a director,
officer, employee, Subsidiary or Affiliate of the Borrower or any Subsidiary
thereof;
(e) (i) Receivables with respect to which the Account Debtor is the United
States of America, any federal, state, local or other political subdivision
thereof or any department, agency or instrumentality of any of the foregoing,
unless the Borrower or applicable Subsidiary Guarantor has complied with the
provisions of the Federal Assignment of Claims Act or other applicable statutes,
including executing and delivering to the Agent all statements of assignment
and/or notification which are in form and substance acceptable to the Agent and
which are deemed necessary by the Agent to effectuate the assignment of such
Receivables to the Agent for the benefit of the Holders of Secured Obligations;
and (ii) Receivables with respect to which the Account Debtor is a foreign
government, any federal, state, local or other political subdivision thereof, or
any department, agency, or instrumentality of any of the foregoing described in
this clause (ii);
(f) Receivables not denominated in Dollars;
(g) Receivables with respect to which the Account Debtor is not a resident
of the United States (which shall not be deemed to include any territories of
the United States) or Canada unless (i) the Account Debtor has supplied the
Borrower or applicable Subsidiary Guarantor with an irrevocable letter of credit
(which letter of credit shall be delivered to the Agent and shall be in form and
substance acceptable to the Agent), or (ii) the full payment of such Receivable
shall have been insured by the Borrower or applicable Subsidiary Guarantor
pursuant to an insurance policy in form and substance acceptable to the Agent
issued by a financial institution satisfactory to the Agent, which policy names
the Agent as the loss payee or beneficiary thereof;
(h) Receivables that are subject to any dispute, contra-account, defense,
offset or counterclaim, volume rebate or advertising or other allowance;
provided that if any portion of any such Receivables is not subject to any
dispute, contra-account, defense, offset, counterclaim, volume rebate or
advertising or other allowance and the payment of such portion is not being
withheld or delayed or otherwise affected in any manner due to the portion that
is subject to such dispute, contra-account, defense, offset, counterclaim,
volume rebate or advertising or other allowance, then such portion which is not
subject to any dispute, contra-account, defense, offset,
10
counterclaim, volume rebate or advertising or other allowance shall not be
excluded from Eligible Receivables because of this clause (h); provided,
further, that the portion of a contra-account that arises from a claim against
the Borrower or a Subsidiary Guarantor that is supported by a letter of credit
issued on behalf of the Borrower or a Subsidiary Guarantor in favor of a
customer as payment for goods or services shall not be excluded from Eligible
Receivables because of this clause (h);
(i) Receivables with respect to which the Account Debtor is the subject of
a bankruptcy or similar insolvency proceeding or has made an assignment for the
benefit of creditors or whose assets have been conveyed to a receiver, trustee
or assignee for the benefit of creditors;
(j) Receivables with respect to which the Account Debtor's obligation to
pay the Receivable is conditional upon the Account Debtor's approval or is
otherwise subject to any repurchase obligation or return right, as with sales
made on a ▇▇▇▇-and-hold, guaranteed sale, sale-and-return, sale on approval
(except with respect to Receivables in connection with which Account Debtors are
entitled to return Petroleum Inventory on the basis of the quality of such
Petroleum Inventory) or consignment basis, or where such Receivables represent
progress ▇▇▇▇▇▇▇▇;
(k) Receivables with respect to which the Account Debtor is located in
Minnesota (or any other jurisdiction which adopts a statute or other requirement
with respect to which any Person that obtains business from within such
jurisdiction or is otherwise subject to such jurisdiction's tax law requiring
such Person to file a Business Activity Report or make any other required
filings in a timely manner in order to enforce its claims in such jurisdiction's
courts or arising under such jurisdiction's laws); provided, however, such
Receivables shall nonetheless be eligible if the Borrower or applicable
Subsidiary Guarantor has filed a Business Activity Report (or other applicable
report) with the applicable state office, or is qualified to do business in such
jurisdiction and, at the time the Receivable was created, was qualified to do
business in such jurisdiction, or had on file with the applicable state office a
current Business Activity Report (or other applicable report), or is exempt from
such filing requirement;
(l) Receivables with respect to which the Account Debtor's obligation does
not constitute its legal, valid and binding obligation, enforceable against it
in accordance with its terms;
(m) Receivables with respect to which the Borrower or applicable
Subsidiary Guarantor has not yet shipped the applicable goods or performed the
applicable service;
(n) any Receivable which is not in conformity with the representations and
warranties made by the Borrower or the applicable Subsidiary Guarantors to the
Agent with respect thereto, whether contained in this Agreement or the Security
Agreement;
(o) Receivables in connection with which the Borrower or applicable
Subsidiary Guarantor (or any other party to such Receivable) is in default in
the performance or observance of any of the terms thereof (other than payment of
such Receivable) in any material respect;
11
(p) Receivables that are not bona fide existing obligations created by the
sale and actual delivery of inventory, goods or other property or the furnishing
of services of other good and sufficient consideration to customers of the
Borrower or the applicable Subsidiary Guarantors in the ordinary course of
business;
(q) Receivables subject to any Lien or the Petroleum Inventory, goods,
property, services or other consideration of which any such Receivable
constitutes proceeds is subject to any such Lien, in either case other than the
Lien granted to the Agent in connection herewith for the benefit of the Holders
of Secured Obligations;
(r) Receivables that have been classified by the Borrower or any
Subsidiary Guarantor as doubtful or that have otherwise failed to meet
established or customary credit standards of the Borrower or the Subsidiary
Guarantors, to the extent of such write-down;
(s) Receivables evidenced by a promissory note or other similar
instrument;
(t) Receivables that are subordinate or junior in right or priority of
payment to any other obligation or claim;
(u) Receivables that are consigned or otherwise assigned to any Person for
collection or otherwise; and
(v) Receivables generated by sales on a cash-on-delivery basis.
"Environmental Laws" means any and all federal, state and local statutes,
laws, judicial decisions, regulations, ordinances, rules, judgments, orders,
decrees, plans, injunctions, permits, concessions, grants, franchises, licenses,
agreements and other governmental restrictions relating to (i) the protection of
the environment, (ii) the effect of the environment on human health, (iii)
emissions, discharges or releases of pollutants, contaminants, hazardous
substances or wastes into surface water, ground water or land, or (iv) the
manufacture, processing, distribution, use, treatment, storage, disposal,
transport or handling of pollutants, contaminants, hazardous substances or
wastes or the clean-up or other remediation thereof.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended from time to time, and any rules or regulations promulgated thereunder.
"Eurodollar Advance" means an Advance which, except as otherwise provided
in Section 2.10, bears interest at the applicable Eurodollar Rate.
"Eurodollar Base Rate" means, with respect to a Eurodollar Advance for the
relevant Interest Period, the applicable British Bankers' Association LIBOR rate
for deposits in Dollars as reported by any generally recognized financial
information service as of 11:00 a.m. (London time) two (2) Business Days prior
to the first day of such Interest Period, and having a maturity equal to such
Interest Period, provided that, if no such British Bankers' Association LIBOR
rate is available to the Agent, the applicable Eurodollar Base Rate for the
relevant Interest Period shall instead be the rate determined by the Agent to be
the rate at which Bank One or one of its affiliate banks offers to place
deposits in Dollars with first-class banks in the London interbank market at
approximately 11:00 a.m. (London time) two (2) Business Days prior to the first
day of
12
such Interest Period, in the approximate amount of Bank One's relevant
Eurodollar Loan and having a maturity equal to such Interest Period.
"Eurodollar Loan" means a Loan which, except as otherwise provided in
Section 2.10, bears interest at the applicable Eurodollar Rate.
"Eurodollar Rate" means, with respect to a Eurodollar Advance for the
relevant Interest Period, the sum of (i) the quotient of (a) the Eurodollar Base
Rate applicable to such Interest Period, divided by (b) one minus the Reserve
Requirement (expressed as a decimal) applicable to such Interest Period, plus
(ii) the then Applicable Margin, changing as and when the Applicable Margin
changes.
"Excess Availability" means, on any date of determination, the excess of
the Borrowing Base over the Aggregate Outstanding Credit Exposure on such date.
"Excluded Proceeds" is defined in Section 6.24.
"Excluded Subsidiary" means each of Tesoro Indonesia Petroleum Company,
Tesoro Equipment Company, Tesoro Crude Oil Company, Tesoro Gasoline Marketing
Company, Tesoro Pump & Valve Company, Tesoro Environmental Products Company,
Tesoro Latin America Company, Tesoro High Plains Company, Tesoro South Pacific
Petroleum Company, Tesoro Technology Company, Tesoro Geotech Company, Tesoro
Marine Services Holding Company, Tesoro Marine Services, LLC, Tesoro Building
Project, L.P., Interior Fuels Company, Coastwide Marine Services, Inc., Tesoro
Petroleum (Singapore) Pte. Ltd., the Pipeline Subsidiaries, and such other
Subsidiaries that the Borrower, with the Agent's prior written consent, may
identify to the Agent and the Lenders from time to time.
"Excluded Taxes" means, in the case of each Lender or applicable Lending
Installation and the Agent, taxes imposed on its overall net income, and
franchise taxes imposed on it, by (i) the jurisdiction under the laws of which
such Lender or the Agent is incorporated or organized or any political
combination or subdivision or taxing authority thereof or (ii) the jurisdiction
in which the Agent's or such Lender's principal executive office or such
Lender's applicable Lending Installation is located.
"Exhibit" refers to an exhibit to this Agreement, unless another document
is specifically referenced.
"Facility LC" is defined in Section 2.19.1.
"Facility LC Application" is defined in Section 2.19.3.
"Facility LC Collateral Account" is defined in Section 2.19.11.
"Facility LC Pro Rata Share" means, for any Lender:
(x) at any time the LC Obligations are less than or equal to the Aggregate
Outstanding Pre-Funded Letter of Credit Exposure, a portion equal to a fraction
the numerator of which is
13
such Lender's Outstanding Pre-Funded Letter of Credit Exposure and the
denominator of which is the Aggregate Outstanding Pre-Funded Letter of Credit
Exposure; and
(y) at any time the LC Obligations exceed the Aggregate Outstanding
Pre-Funded Letter of Credit Exposure then in effect, a portion equal to
(i) for that part of the LC Obligations that equal the Aggregate
Outstanding Pre-Funded Letter of Credit Exposure, the amount
calculated in clause (x) hereof, plus
(ii) for that part of the LC Obligations that exceeds the Aggregate
Outstanding Pre-Funded Letter of Credit Exposure, the amount derived
from a fraction the numerator of which is such Lender's Revolving
Loan Commitment and the denominator of which is the Aggregate
Revolving Loan Commitment; provided, however, that if the Revolving
Loan Commitments have been terminated, the amount required by this
clause (ii) shall be calculated using the then outstanding principal
amount of such Lender's Revolving Loans and the aggregate
outstanding principal amount of all outstanding Revolving Loans.
"Federal Funds Effective Rate" means, for any day, an interest rate per
annum equal to the weighted average of the rates on overnight Federal funds
transactions with members of the Federal Reserve System arranged by Federal
funds brokers on such day, as published for such day (or, if such day is not a
Business Day, for the immediately preceding Business Day) by the Federal Reserve
Bank of New York, or, if such rate is not so published for any day which is a
Business Day, the average of the quotations at approximately 10:00 a.m. (Chicago
time) on such day on such transactions received by the Agent from three Federal
funds brokers of recognized standing selected by the Agent in its sole
discretion.
"Financing" means, with respect to any Person, (i) the issuance or sale by
such Person of any equity interests in such Person, or (ii) the issuance or sale
by such Person of any Indebtedness other than Indebtedness described in Sections
6.14.1 through 6.14.5; provided, however, that the foregoing clause (ii) shall
not permit the incurrence by the Borrower or any Subsidiary of any Indebtedness
if such incurrence is not otherwise permitted by this Agreement.
"Fixed Charges" means, for any period of determination, the sum of (i)
Consolidated Interest Expense on a cash basis, and (ii) scheduled cash payments
of the principal amount of Indebtedness; provided, however, that payments of
principal owing under or in connection with the Revolving Loans shall not be
included in any determination of Fixed Charges.
"Floating Rate" means, for any day, a rate per annum equal to the sum of
(i) the Alternate Base Rate for such day, changing when and as the Alternate
Base Rate changes plus (ii) the then Applicable Margin, changing as and when the
Applicable Margin changes.
"Floating Rate Advance" means an Advance which, except as otherwise
provided in Section 2.10, bears interest at the Floating Rate.
14
"Floating Rate Loan" means a Revolving Loan which, except as otherwise
provided in Section 2.10, bears interest at the Floating Rate.
"Fund" means any Person (other than a natural person) that is (or will be)
engaged in making, purchasing, holding or otherwise investing in commercial
loans and similar extensions of credit in the ordinary course of its business.
"Gross Amount of Eligible Petroleum Inventory" means Eligible Petroleum
Inventory valued at market value, less (i) the value of reserves which have been
recorded by the Borrower and the Subsidiary Guarantors with respect to obsolete,
slow-moving or excess Petroleum Inventory, and (ii) such other reserves as the
Agent elects to establish in accordance with its reasonable credit judgment
(which credit judgment shall be exercised in a manner that is not arbitrary or
capricious).
"Gross Amount of Eligible Receivables" means the outstanding face amount
of Eligible Receivables, determined in accordance with Agreement Accounting
Principles, consistently applied, less (i) all financing charges, late fees and
other fees that are unearned, (ii) the value of any accrual that has been
recorded by the Borrower and the Subsidiary Guarantors with respect to downward
price adjustments, and (iii) such other reserves as the Agent elects to
establish in accordance with its reasonable credit judgment (which credit
judgment shall be exercised in a manner that is not arbitrary or capricious).
"Guaranty" means the Subsidiary Guaranty, dated as of April 17, 2003, made
by certain Subsidiaries of the Borrower in favor of the Agent for the benefit of
the Holders of Secured Obligations, as the same may be amended, restated,
supplemented or otherwise modified from time to time.
"Highest Lawful Rate" means, at any time, the maximum rate of interest the
Holders of Secured Obligations may lawfully contract for, charge, or receive in
respect of the Secured Obligations as allowed by any applicable law. For
purposes of determining the Highest Lawful Rate under applicable law of the
State of Texas, the applicable rate ceiling shall be (a) the "weekly ceiling"
described in and computed in accordance with the provisions of Section 303.003
of the Texas Finance Code, as amended, or (b) if the parties subsequently
contract as allowed by any applicable law, the "quarterly ceiling" or the
"annualized ceiling" computed pursuant to Section 303.008 of the Texas Finance
Code, as amended; provided, however, that at any time the "weekly ceiling", the
"quarterly ceiling", or the "annualized ceiling" shall be less than eighteen
percent (18.0%) per annum or more than twenty-four percent (24.0%) per annum,
the provisions of Section 303.009(a) and Section 300.009(b) of the Texas Finance
Code, as amended, shall control for purposes of such determination, as
applicable.
"Holders of Secured Obligations" means the holders of the Secured
Obligations from time to time and shall refer to (i) each Lender in respect of
its Loans and its Outstanding Pre-Funded Letter of Credit Exposure, (ii) each LC
Issuer in respect of Reimbursement Obligations, (iii) the Agent, the Lenders,
and the LC Issuers in respect of all other present and future obligations and
liabilities of the Borrower or any of its Subsidiary Guarantors of every type
and description arising under or in connection with this Agreement or any other
Loan Document, (iv) each Person benefiting from indemnities made by the Borrower
or any Subsidiary Guarantor
15
hereunder or under other Loan Documents in respect of the obligations and
liabilities of the Borrower or such Subsidiary Guarantor to such Person, (v)
each Lender (or affiliate thereof), in respect of all Rate Management
Obligations of the Borrower to such Lender (or such affiliate) as exchange party
or counterparty under any Rate Management Transaction, and (vi) their respective
successors, transferees and assigns.
"Indebtedness" of a Person means, at any time, without duplication, such
Person's (i) obligations for borrowed money, (ii) obligations representing the
deferred purchase price of Property or services (other than current accounts
payable arising in the ordinary course of such Person's business payable on
terms customary in the trade), (iii) obligations, whether or not assumed,
secured by Liens or payable out of the proceeds or production from Property now
or hereafter owned or acquired by such Person, (iv) obligations which are
evidenced by notes, bonds, debentures, acceptances, or other instruments, (v)
obligations to purchase securities or other Property arising out of or in
connection with the sale of the same or substantially similar securities or
Property, (vi) Capitalized Lease Obligations, (vii) Contingent Obligations of
such Person, (viii) reimbursement obligations under Letters of Credit, bankers'
acceptances, surety bonds and similar instruments, (ix) Off-Balance Sheet
Liabilities, (x) obligations under Sale and Leaseback Transactions, (xi) Net
▇▇▇▇-to-Market Exposure under Rate Management Transactions, (xii) all
obligations of such Person, contingent or otherwise, to purchase, redeem, retire
or otherwise acquire for value any capital stock of such Person, (xiii) the
liquidation value of any mandatorily redeemable preferred capital stock of such
Person or its Subsidiaries held by any Person other than such Person and its
wholly-owned Subsidiaries, (xiv) obligations of any partnership or
unincorporated joint venture in which such Person is a general partner or a
joint venturer, but only to the extent to which there is recourse to such Person
for the payment of such obligations, and (xv) any other obligation for borrowed
money which in accordance with Agreement Accounting Principles would be shown as
a liability on the consolidated balance sheet of such Person. Obligations of the
Borrower and its Subsidiaries to pay dues to Marine Spill Response Corporation
in an aggregate amount of up to $2,000,000 shall not be deemed to constitute
Indebtedness. Obligations in an aggregate amount not in excess of $3,000,000 at
any time owing in respect of the Borrower's retention and use of ▇▇▇▇ Inlet
Spill Prevention and Response, Inc. (which provides the Borrower with
spill-response capabilities) shall not constitute Indebtedness.
"Intercreditor Agreement" means, collectively, (x) Article XI of the
Senior Note Indenture and Article X of the Senior Term Loan Agreement, attached
hereto as Exhibit I, as in effect on the Closing Date, and (y) an intercreditor
agreement between the Agent and the Multiparty Collateral Agent, in form and
substance acceptable to each such party, entered into pursuant to Section 11.01
of the Senior Note Indenture and Section 10.01 of the Senior Term Loan
Agreement.
"Interest Period" means, with respect to a Eurodollar Advance, a period of
one, two, three or six months, commencing on a Business Day selected by the
Borrower pursuant to this Agreement. Such Interest Period shall end on but
exclude the day which corresponds numerically to such date one, two, three or
six months thereafter, provided, however, that if there is no such numerically
corresponding day in such next, second, third or sixth succeeding month, such
Interest Period shall end on the last Business Day of such next, second, third
or sixth succeeding month. If an Interest Period would otherwise end on a day
which is not a Business
16
Day, such Interest Period shall end on the next succeeding Business Day,
provided, however, that if said next succeeding Business Day falls in a new
calendar month, such Interest Period shall end on the immediately preceding
Business Day. Notwithstanding the foregoing or anything to the contrary in any
Loan Document, from the Closing Date through the date on which the Agent
confirms to the Borrower that the syndication of the Loans and Revolving Loan
Commitments has been completed (the "Syndication Period"), each Interest Period
for Eurodollar Advances shall equal seven days.
"Interim Collateral Report" means a report, in form and substance
substantially similar to Exhibit J-1 hereto and acceptable to the Agent.
"Investment" of a Person means any loan, advance (other than commission,
travel and similar advances to officers and employees made in the ordinary
course of business), extension of credit (other than accounts receivable arising
in the ordinary course of business on terms customary in the trade) or
contribution of capital by such Person; stocks, bonds, mutual funds, partnership
interests, notes, debentures or other securities owned by such Person; any
deposit accounts and certificates of deposit owned by such Person; and
structured notes, derivative financial instruments and other similar instruments
or contracts owned by such Person.
"LC Fee" is defined in Section 2.19.4.
"LC Issuer" means Bank One (or any subsidiary or affiliate of Bank One
designated by Bank One) or any other Lender (or any subsidiary or affiliate of
such Lender designated by such Lender), subject to the Agent's prior written
consent (which consent shall not be unreasonably withheld), in its separate
capacity as an issuer of Facility LCs hereunder.
"LC Obligations" means, at any time, the sum, without duplication, of (i)
the aggregate undrawn stated amount under all Facility LCs outstanding at such
time plus (ii) the aggregate unpaid amount at such time of all Reimbursement
Obligations.
"LC Payment Date" is defined in Section 2.19.5.
"Lenders" means the lending institutions listed on the signature pages of
this Agreement or lending institutions parties to Assignment Agreements
delivered pursuant to Section 12.3, in each case together with their respective
successors and assigns. Unless otherwise specified, the term "Lenders" includes
each LC Issuer, the Non-Ratable Lender, each Pre-Funded Lender and the Agent
with respect to Collateral Protection Advances.
"Lending Installation" means, with respect to a Lender or the Agent, the
office, branch, subsidiary or affiliate of such Lender or the Agent listed on
the signature pages hereof or on the administrative information sheets provided
to the Agent in connection herewith or on a Schedule or otherwise selected by
such Lender or the Agent pursuant to Section 2.16.
"Letter of Credit" of a Person means a letter of credit or similar
instrument which is issued upon the application of such Person or upon which
such Person is an account party or for which such Person is in any way liable.
17
"Lien" means any lien (statutory or other), mortgage, pledge,
hypothecation, assignment, deposit arrangement, encumbrance or preference,
priority or other security agreement or preferential arrangement of any kind or
nature whatsoever (including, without limitation, the interest of a vendor or
lessor under any conditional sale, Capitalized Lease or other title retention
agreement, and, in the case of stock, stockholders agreements, voting trust
agreements and all similar arrangements).
"Loan" means, with respect to a Lender, any loan of such Lender made
pursuant to Article II (or any conversion or continuation thereof), including,
without limitation, Revolving Loans, Collateral Protection Advances and
Non-Ratable Loans.
"Loan Documents" means this Agreement, the Facility LC Applications, the
Collateral Documents, the Guaranty, the Intercreditor Agreement, and all other
documents, instruments, notes (including any Notes issued pursuant to Section
2.12 (if requested)) and agreements executed in connection herewith or therewith
or contemplated hereby or thereby, as the same may be amended, restated or
otherwise modified and in effect from time to time.
"Material Adverse Effect" means a material adverse effect on (i) the
business, Property, condition (financial or otherwise), operations or results of
operations or prospects of the Borrower and its Subsidiaries taken as a whole,
(ii) the ability of the Borrower or any Subsidiary Guarantor to perform its
obligations under the Loan Documents, or (iii) the validity or enforceability of
the Loan Documents or the rights or remedies of the Agent, the LC Issuers, or
the Lenders thereunder or their rights with respect to the Collateral.
"Material Indebtedness" means any Indebtedness in an outstanding principal
amount of $25,000,000 or more in the aggregate (or the equivalent thereof in any
currency other than Dollars).
"Material Indebtedness Agreement" means any agreement under which any
Material Indebtedness was created or is governed or which provides for the
incurrence of Indebtedness in an amount which would constitute Material
Indebtedness (whether or not an amount of Indebtedness constituting Material
Indebtedness is outstanding thereunder).
"Modify" and "Modification" are defined in Section 2.19.1.
"Monthly Collateral Report" means a report, in form and substance
substantially similar to Exhibit J-2 hereto and acceptable to the Agent, which
shall include, among other things, the following additional information:
(i) a detailed aged trial balance of each Receivable of the Borrower and
its Subsidiaries in existence as of the date of such report specifying the name
and balance due for the applicable Account Debtor, as reconciled in a manner
reasonably acceptable to the Agent;
(ii) with respect to Petroleum Inventory, a detailed listing of product
type, volume on hand by location, and Current Petroleum Inventory Market Price;
(iii) a spreadsheet which identifies all Eligible Receivables and Eligible
Petroleum Inventory and all non-Eligible Receivables and non-Eligible Petroleum
Inventory; and
18
(iv) a schedule and aging of the Borrower's and its Subsidiaries' accounts
payable.
"Moody's" means ▇▇▇▇▇'▇ Investors Services, Inc. and any successor
thereto.
"Multiemployer Plan" means a multiemployer plan, as defined in Section
4001(a)(3) of ERISA, which is covered by Title IV of ERISA and to which the
Borrower or any member of the Controlled Group is obligated to make
contributions.
"Multiparty Collateral Agent" means Wilmington Trust Company, together
with its successors and permitted assigns, in its capacity as "Collateral Agent"
for the Senior Noteholders and the Senior Term Loan Holders.
"Net Cash Proceeds" means, with respect to any sale of Property or any
Financing by any Person, (a) cash (freely convertible into Dollars) received by
such Person or any Subsidiary of such Person from such sale of Property
(including cash received as consideration for the assumption or incurrence of
liabilities incurred in connection with or in anticipation of such sale of
Property) or Financing, after (i) provision for all income or other taxes
measured by or resulting from such sale of Property, (ii) payment of all
reasonable brokerage commissions and other fees and expenses related to such
sale of Property or Financing, and (iii) all amounts used to repay Indebtedness
secured by a Lien on any asset disposed of in such sale of Property which is or
may be required (by the express terms of the instrument governing such
Indebtedness) to be repaid in connection with such sale of Property (including
payments made to obtain or avoid the need for the consent of any holder of such
Indebtedness) or Financing.
"Net Consolidated Capital Expenditures" means, with respect to any fiscal
quarter, Consolidated Capital Expenditures for such quarter minus Net Cash
Proceeds resulting from Asset Sales during such quarter minus the aggregate
amount of purchase money Indebtedness incurred during such quarter.
"Net ▇▇▇▇-to-Market Exposure" of a Person means, as of any date of
determination, the excess (if any) of all unrealized losses over all unrealized
profits of such Person arising from Rate Management Transactions. "Unrealized
losses" means the fair market value of the cost to such Person of replacing such
Rate Management Transaction as of the date of determination (assuming the Rate
Management Transaction were to be terminated as of that date), and "unrealized
profits" means the fair market value of the gain to such Person of replacing
such Rate Management Transaction as of the date of determination (assuming such
Rate Management Transaction were to be terminated as of that date).
"Non-Lender Asset Sale Proceeds" means any amount (x) that results from a
sale of the Borrower's or any Subsidiary's Property, (y) that does not
constitute Collateral, and (z) that is not required to be applied in reduction
of the principal amount of outstanding Loans under Section 2.2.2.
"Non-Ratable Lender" means Bank One or such other Lender which may succeed
to Bank One's rights and obligations as Non-Ratable Lender pursuant to the terms
of this Agreement.
"Non-Ratable Loan" has the meaning set forth in Section 2.1.3.
19
"Non-U.S. Lender" is defined in Section 3.5(iv).
"Note" is defined in Section 2.12.
"Obligations" means all Revolving Loans, Non-Ratable Loans, Reimbursement
Obligations, other obligations owing to Pre-Funded Lenders as described in
Section 2.19, including, without limitation, any Pre-Funded Account
Reimbursement Amount, advances, debts, liabilities, obligations, covenants and
duties owing by the Borrower to the Agent, any Lender, the Non-Ratable Lender,
any LC Issuer, the Arranger, any affiliate of the Agent, any Lender, the
Non-Ratable Lender, any LC Issuer, or the Arranger, or any indemnitee under the
provisions of Section 9.6 or any other provisions of the Loan Documents, in each
case of any kind or nature, present or future, arising under this Agreement or
any other Loan Document, whether or not evidenced by any note, guaranty or other
instrument, whether or not for the payment of money, whether arising by reason
of an extension of credit, loan, foreign exchange risk, guaranty,
indemnification, or in any other manner, whether direct or indirect (including
those acquired by assignment), absolute or contingent, due or to become due, now
existing or hereafter arising and however acquired. The term includes, without
limitation, all interest, charges, expenses, fees, attorneys' fees and
disbursements, paralegals' fees (in each case whether or not allowed), and any
other sum chargeable to the Borrower or any of its Subsidiaries under this
Agreement or any other Loan Document.
"Off-Balance Sheet Liability" of a Person means the principal component of
(i) any repurchase obligation or liability of such Person with respect to
Receivables sold by such Person, (ii) any liability under any Sale and Leaseback
Transaction which is not a Capitalized Lease, (iii) any liability under any
so-called "synthetic lease" or "tax ownership operating lease" transaction
entered into by such Person, (iv) any Receivables Purchase Facility, or (v) any
obligation arising with respect to any other transaction which is the functional
equivalent of or takes the place of borrowing but which does not constitute a
liability on the consolidated balance sheets of such Person, but excluding from
this clause (v) all Operating Leases.
"Operating Lease" of a Person means any lease of Property (other than a
Capitalized Lease) by such Person as lessee which has an original term
(including any required renewals and any renewals effective at the option of the
lessor) of one year or more.
"Operating Lease Obligations" means, as of any date of determination, the
amount obtained by aggregating the present values, determined in the case of
each particular Operating Lease by applying a discount rate (which discount rate
shall equal the discount rate which would be applied under Agreement Accounting
Principles if such Operating Lease were a Capitalized Lease) from the date on
which each fixed lease payment is due under such Operating Lease to such date of
determination, of all fixed lease payments due under all Operating Leases of the
Borrower and its Subsidiaries.
"Other Senior Secured Debt" means the Senior Term Loans and the Senior
Notes.
"Other Senior Secured Debt Collateral Proceeds" means any amount
constituting the Borrower's or any Subsidiary's Property (including proceeds
thereof) that secures obligations
20
owing by the Borrower or its Subsidiaries to the Senior Noteholders under the
Senior Notes or the Senior Term Loan Holders under the Senior Term Loan
Agreement.
"Other Taxes" is defined in Section 3.5(ii).
"Outstanding Credit Exposure" means, as to any Lender at any time, the sum
of (i) the aggregate principal amount of its Revolving Loans outstanding at such
time (which shall include, without limitation, the amount of its ratable
obligation to purchase participations in (a) the aggregate principal amount of
Non-Ratable Loans outstanding at such time, (b) the LC Obligations at such time,
and (c) Collateral Protection Advances outstanding at such time), plus (ii) if
such Lender has a Pre-Funded Letter of Credit Commitment, its ratable obligation
to purchase participations in the LC Obligations to the extent not already
covered above in clause (i)(b) plus, subsequent to the occurrence of a
Conversion Event, such Lender's ratable obligation to purchase participations in
those items described above in clauses 1(a), (b), and (c), in all cases in
accordance with the terms of this Agreement.
"Outstanding Pre-Funded Letter of Credit Exposure" means, as to any Lender
at any time, its ratable obligation to purchase participations in the LC
Obligations at such time plus the LC Obligations held by such Lender at such
time; provided, however, that the aggregate thereof shall at no time exceed such
Lender's Pre-Funded Letter of Credit Commitment; provided, further, that no such
purchase obligation shall at any time exceed the then available balance of such
Lender's Credit Linked Deposit.
"Outstanding Revolving Loan Credit Exposure" means, as to any Lender at
any time, the sum of (i) the aggregate principal amount of its Revolving Loans
outstanding at such time, plus (ii) an amount equal to its Revolving Loan Pro
Rata Share of the LC Obligations at such time.
"Participants" is defined in Section 12.2.1.
"Payment Date" means April 1st, July 1st, October 1st, and January 1st of
each calendar year and the Termination Date. Each Payment Date other than the
Termination Date shall relate to the calendar quarter immediately preceding it.
For example, quarterly payments which accrue in respect of the quarter ending
March 31st shall be due and payable on April 1st.
"PBGC" means the Pension Benefit Guaranty Corporation, or any successor
thereto.
"Perfected Cash Interests" means Dollars or Cash Equivalent Investments on
deposit in collection accounts subject to control agreements in form and
substance acceptable to the Agent that grant the Agent first priority perfected
security interests in such accounts and the Dollars and Cash Equivalent
Investments (including proceeds thereof) on deposit or otherwise maintained
therein.
"Permitted Acquisition" is defined in Section 6.13.3.
"Person" means any natural person, corporation, firm, joint venture,
partnership, limited liability company, association, enterprise, trust or other
entity or organization, or any government or political subdivision or any
agency, department or instrumentality thereof.
21
"Petroleum Inventory" means inventory consisting of crude oil, petroleum,
refined petroleum products, byproducts and intermediate feedstocks, and other
energy-related commodities, including, without limitation, blend components
commonly used in the petroleum industry to improve characteristics of, or meet
governmental or customer specifications for, petroleum or refined petroleum
products, all of which inventory shall be valued at market.
"Pipeline Subsidiaries" means each of Kenai Pipeline Company, Tesoro
Alaska Pipeline Company, Tesoro High Plains Pipeline Company, and each other
Person (i) that does not own Collateral or Property required to be Collateral
hereunder, and (ii) substantially all of the assets of which consist of one or
more pipelines comparable to the ones owned by Kenai Pipe Line Company, Tesoro
Alaska Pipeline Company, and Tesoro High Plains Pipeline Company, in each case
together with their respective permitted successors and assigns, including,
without limitation, debtors in possession on their behalf.
"Plan" means an employee pension benefit plan, excluding any Multiemployer
Plan, which is covered by Title IV of ERISA or subject to the minimum funding
standards under Section 412 of the Code as to which the Borrower or any member
of the Controlled Group, may have any liability.
"Pre-Funded Account Reimbursement Amount" means, with respect to any
election by the Borrower to reimburse an LC Issuer in respect of a draw under a
Facility LC with Credit Linked Deposits, an amount equal to such reimbursement
amount plus any return on investment which would have accrued on such amount
pursuant to Section 2.19.4 had such amount not been withdrawn.
"Pre-Funded Investment Earnings" is defined in Section 2.19.4.
"Pre-Funded Lender" means any Lender with a Pre-Funded Letter of Credit
Commitment.
"Pre-Funded Letter of Credit Account" is defined in Section 2.1.4.
"Pre-Funded Letter of Credit Commitment" means, for each Lender, the
commitment of such Lender to participate in LC Obligations and, subsequent to a
Conversion Event, a portion of the Aggregate Outstanding Credit Exposure, in
each case in an aggregate principal amount not to exceed the amount set forth
for such Lender on the Commitment Schedule or in an Assignment Agreement
delivered pursuant to Section 12.3.
"Pre-Funded Letter of Credit Fee" is defined in Section 2.19.4(a).
"Pre-Funded Letter of Credit Fee Rate" means, with respect to the
Pre-Funded Letter of Credit Fee at any time, the percentage rate per annum which
is applicable at such time with respect to such fee as set forth in the Pricing
Schedule.
"Pre-Funded Letter of Credit LIBO Rate" means, on any date of
determination, a per annum rate equal to the Eurodollar Rate without giving
effect to or including in the calculation thereof the then effective Applicable
Margin.
22
"Pre-Funded Letter of Credit Early Reduction Event" is defined in Section
2.2.6(b).
"Pre-Funded Letter of Credit Pro Rata Share" means, with respect to a
Lender, a portion equal to a fraction the numerator of which is such Lender's
Outstanding Pre-Funded Letter of Credit Exposure at such time and the
denominator of which is the Aggregate Outstanding Pre-Funded Letter of Credit
Exposure at such time.
"Pricing Schedule" means the Schedule identifying the Applicable Margin,
the Applicable Fee Rate, and the Pre-Funded Letter of Credit Fee Rate attached
hereto and identified as such.
"Prime Rate" means a rate per annum equal to the prime rate of interest
announced from time to time by Bank One or its parent (which is not necessarily
the lowest rate charged to any customer), changing when and as said prime rate
changes.
"Prior Credit Agreement" means the Second Amended and Restated Credit
Agreement, dated as of June 17, 2003, by and among the Borrower, certain
financial institutions, and Bank One, as Administrative Agent, as amended or
modified prior to the Closing Date.
"Property" of a Person means any and all property, whether real, personal,
tangible, intangible, or mixed, of such Person, or other assets owned, leased or
operated by such Person.
"Pro Rata Share" means, with respect to a Lender, a portion equal to a
fraction the numerator of which is the sum of such Lender's Revolving Loan
Commitment and Pre-Funded Letter of Credit Commitment at such time (in each
case, as adjusted from time to time in accordance with the provisions of this
Agreement), and the denominator of which is the sum of the Aggregate Revolving
Loan Commitment at such time and the Aggregate Pre-Funded Letter of Credit
Commitment; provided, that if the Revolving Loan Commitments have been
terminated, "Pro Rata Share" means a fraction the numerator of which is such
Lender's Outstanding Credit Exposure at such time and the denominator of which
is the Aggregate Outstanding Credit Exposure at such time.
"Purchase Price" means the total consideration and other amounts payable
in connection with any Acquisition, including, without limitation, any portion
of the consideration payable in cash, all Indebtedness, liabilities and
contingent obligations incurred or assumed in connection with such Acquisition
and all transaction costs and expenses incurred in connection with such
Acquisition, but exclusive of the value of any capital stock or other equity
interests of the Borrower or any Subsidiary issued as consideration for such
Acquisition.
"Purchasers" is defined in Section 12.3.1.
"Rate Management Obligations" of a Person means any and all obligations of
such Person, whether absolute or contingent and howsoever and whensoever
created, arising, evidenced or acquired (including all renewals, extensions and
modifications thereof and substitutions therefor), under (i) any and all Rate
Management Transactions, and (ii) any and all cancellations, buy backs,
reversals, terminations or assignments of any Rate Management Transactions.
23
"Rate Management Transaction" means any transaction (including an
agreement with respect thereto) now existing or hereafter entered by the
Borrower or a Subsidiary which is a rate swap, basis swap, forward rate
transaction, equity or equity index swap, equity or equity index option, bond
option, interest rate option, foreign exchange transaction, cap transaction,
floor transaction, collar transaction, forward transaction, currency swap
transaction, cross-currency rate swap transaction, currency option or any other
similar transaction (including any option with respect to any of these
transactions) or any combination thereof, whether linked to one or more interest
rates, foreign currencies, or equity prices.
"Receivable(s)" means and includes any and all of the Borrower's and its
Subsidiaries' presently existing and hereafter arising or acquired accounts,
accounts receivable, and all present and future rights of the Borrower and its
Subsidiaries to payment for goods sold or leased or for services rendered
(except those evidenced by instruments or chattel paper), whether or not they
have been earned by performance, and all rights in and to any merchandise or
goods which any of the same may represent, and all rights, title, security and
guaranties with respect to each of the foregoing, including, without limitation,
any right of stoppage in transit.
"Receivables Purchase Documents" means any series of receivables purchase
or sale agreements generally consistent with terms contained in comparable
structured finance transactions pursuant to which the Borrower or any of its
Subsidiaries, in their respective capacities as sellers or transferors of any
Receivables, sell or transfer to SPVs all of their respective right, title and
interest in and to certain Receivables for further sale or transfer (or granting
of Liens to other purchasers of or investors in such assets or interests therein
(and the other documents, instruments and agreements executed in connection
therewith), as any such agreements may be amended, restated, supplemented or
otherwise modified from time to time, or any replacement or substitution
therefor.
"Receivables Purchase Facility" means any securitization facility made
available to the Borrower or any of its Subsidiaries, pursuant to which
Receivables of the Borrower or any of its Subsidiaries are transferred to one or
more SPVs, and thereafter to certain investors, pursuant to the terms and
conditions of the Receivables Purchase Documents.
"Refinancing Indebtedness" means any Indebtedness permitted under this
Agreement that exists (with respect to any amendments, modifications or
supplements thereof) or that is incurred to refund, refinance, replace,
exchange, renew, repay, extend, modify, amend or supplement (including pursuant
to any defeasance or discharge mechanism) (collectively, "refinance",
"refinances" and "refinanced" shall have a correlative meaning) any other
specified Indebtedness permitted under this Agreement, including any
Indebtedness that refinances Refinancing Indebtedness, provided, however, that:
(i)if the Stated Maturity (as such term is hereinafter defined) of the
Indebtedness being refinanced is earlier than the Termination Date as set forth
in clause (a) of the definition thereof, the Refinancing Indebtedness has a
Stated Maturity no earlier than the Stated Maturity of the Indebtedness being
refinanced, or if the Stated Maturity of the Indebtedness is being refinanced is
later than the Termination Date as set forth in clause (a) of the definition
thereof, the Refinancing Indebtedness has a Stated Maturity that is at least 91
days later than such Termination Date;
24
(ii)the Refinancing Indebtedness has an Average Life (as such term is
hereinafter defined) at the time such Refinancing Indebtedness is incurred equal
to or greater than the Average Life of the Indebtedness being refinanced;
(iii)such Refinancing Indebtedness is incurred in an aggregate principal
amount (or if issued with original issue discount, an aggregate issue price)
that is equal to or less than the sum of the aggregate principal amount (or if
issued with original issue discount, the aggregate accreted value) then
outstanding of the Indebtedness being refinanced (plus, without duplication, any
additional Indebtedness incurred to pay interest or premiums required by
instruments governing such existing Indebtedness and fees incurred in connection
therewith);
(iv)after giving effect to the incurrence of such Refinancing
Indebtedness, no Default or Unmatured Default would exist hereunder;
(v)the obligor(s) of such Refinancing Indebtedness shall not be materially
different than the obligors of the Indebtedness being refinanced;
(vi)the terms and conditions of such Refinancing Indebtedness shall be no
less favorable in any material respect than the terms and conditions of the
Indebtedness being refinanced; and
(vii)any Property securing such Refinancing Indebtedness shall not include
Collateral and shall either (a) constitute Property that secures the
Indebtedness being replaced by such Refinancing Indebtedness or other
Indebtedness permitted by this Agreement or (b) constitute Property that secures
or formerly secured purchase money Indebtedness permitted under Section 6.14.4.
As used in this definition the term "Stated Maturity" means, with respect
to any Indebtedness, the date specified in the documents or instruments
evidencing such Indebtedness as the fixed date on which the payment of principal
of such Indebtedness is due and payable, including pursuant to any mandatory
prepayment or redemption provision, but shall not include any contingent
obligations to repay, prepay, redeem or repurchase any such principal prior to
the date originally scheduled for the payment thereof. As used in this
definition, the term "Average Life" means, as of the date of determination, with
respect to any Indebtedness, the quotient obtained by dividing (a) the sum of
the products of the numbers of years from the date of determination to the dates
of each successive scheduled principal payment of such Indebtedness multiplied
by the amount of such payment by (b) the sum of all such payments.
"Regulation D" means Regulation D of the Board of Governors of the Federal
Reserve System as from time to time in effect and any successor thereto or other
regulation or official interpretation of said Board of Governors relating to
reserve requirements applicable to member banks of the Federal Reserve System.
"Regulation U" means Regulation U of the Board of Governors of the Federal
Reserve System as from time to time in effect and any successor or other
regulation or official interpretation of said Board of Governors relating to the
extension of credit by banks, non-banks
25
and non-broker lenders for the purpose of purchasing or carrying margin stocks
applicable to member banks of the Federal Reserve System.
"Regulation X" means Regulation X of the Board of Governors of the Federal
Reserve System as from time to time in effect and any successor or other
regulation or official interpretation of said Board of Governors relating to the
extension of credit by foreign lenders for the purpose of purchasing or carrying
margin stock (as defined therein).
"Reimbursement Obligations" means, at any time, the aggregate of all
obligations of the Borrower then outstanding under Section 2.19 to reimburse
each LC Issuer for amounts paid by such LC Issuer in respect of any one or more
drawings under Facility LCs.
"Rental Reserve" means (i) with respect to any Eligible Carrier, such
amount as the Agent in its reasonable credit judgment shall establish from time
to time for such Eligible Carrier and (ii) with respect to any location not
owned by the Borrower or a Subsidiary Guarantor at which Petroleum Inventory is
located, stored, processed, maintained or otherwise held, until such time as
such location is subject to a Third Party Agreement, an amount equal to 1
month's rent for such location.
"Reportable Event" means a reportable event as defined in Section 4043 of
ERISA and the regulations issued under such section, with respect to a Plan
subject to Title IV of ERISA, excluding, however, such events as to which the
PBGC has by regulation waived the requirement of Section 4043(a) of ERISA that
it be notified within 30 days of the occurrence of such event, provided,
however, that a failure to meet the minimum funding standard of Section 412 of
the Code and of Section 302 of ERISA shall be a Reportable Event regardless of
the issuance of any such waiver of the notice requirement in accordance with
either Section 4043(a) of ERISA or Section 412(d) of the Code.
"Required Lenders" means Lenders in the aggregate having greater than 50%
of the sum of (i) the Aggregate Revolving Loan Commitment and (ii) the Aggregate
Pre-Funded Letter of Credit Commitment; provided, that if the Revolving Loan
Commitment has been terminated, "Required Lenders" means Lenders in the
aggregate holding greater than 50% of the Aggregate Outstanding Credit Exposure.
"Reserve Requirement" means, with respect to an Interest Period, the
maximum aggregate reserve requirement (including all basic, supplemental,
marginal and other reserves) which is imposed under Regulation D on
"Eurocurrency liabilities" (as defined in Regulation D).
"Restricted Payments" is defined in Section 6.10.
"Retail Property" means Property of the Borrower or any Subsidiary owned
in connection with the sale of motor fuels and convenience products and services
to consumers in the retail market.
"Revolver Prepayment Event" is defined in Section 2.2.6(a).
"Revolving Loan" means, with respect to a Lender, such Lender's loan made
pursuant to its commitment to lend set forth in Section 2.1 (and any conversion
or continuation thereof).
26
"Revolving Loan Commitment" means, for each Lender, including, without
limitation, each LC Issuer, such Lender's obligation to make Revolving Loans to,
and participate in Facility LCs issued upon the application of, the Borrower in
an aggregate amount not exceeding the amount set forth for such Lender on the
Commitment Schedule or in an Assignment Agreement delivered pursuant to Section
12.3, as such amount may be modified from time to time pursuant to the terms
hereof.
"Revolving Loan Pro Rata Share" means, with respect to a Lender, a portion
equal to a fraction the numerator of which is such Lender's Revolving Loan
Commitment at such time and the denominator of which is the Aggregate Revolving
Loan Commitment at such time; provided, however, that if the Revolving Loan
Commitments have been terminated pursuant to the terms of this Agreement,
"Revolving Loan Pro Rata Share" means a portion equal to a fraction the
numerator of which is such Lender's Outstanding Revolving Loan Credit Exposure
at such time and the denominator of which is the Aggregate Outstanding Revolving
Loan Credit Exposure at such time.
"S&P" means Standard and Poor's Ratings Group, a division of The
▇▇▇▇▇▇-▇▇▇▇ Companies, Inc., and any successor thereto.
"Sale and Leaseback Transaction" means any sale or other transfer of
Property by any Person with the intent to lease such Property as lessee.
"Schedule" refers to a specific schedule to this Agreement, unless another
document is specifically referenced.
"Section" means a numbered section of this Agreement, unless another
document is specifically referenced.
"Secured Obligations" means, collectively, (i) the Obligations, (ii) all
Rate Management Obligations owing in connection with Rate Management
Transactions to any Lender or any affiliate of any Lender, and (iii) to the
extent not covered in clauses (i) and (ii), amounts owing to any Lender or the
Agent under or in connection with Bank Products provided by such Lender or the
Agent to the Borrower or its Affiliates.
"Security Agreement" means the Security Agreement, dated as of April 17,
2003, by and among the Borrower, certain Subsidiaries thereof and the Agent for
the benefit of the Holders of Secured Obligations, as the same may be amended,
restated, supplemented or otherwise modified from time to time.
"Senior Note Indenture" means the Indenture, dated as of April 17, 2003,
by and among the Borrower, certain Subsidiaries of the Borrower, in their
capacities as "Guarantors" thereunder, and the Senior Note Trustee, together
with the agreements, documents and instruments delivered in connection therewith
or issued pursuant thereto, including, without limitation, the Senior Notes and
any guarantees, security documents, mortgages, and collateral agency agreement
required thereunder, in each case as the same may be amended, restated,
supplemented or otherwise modified from time to time.
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"Senior Note Trustee" means The Bank of New York, together with its
successors and permitted assigns.
"Senior Noteholders" means those Persons that from time to time hold
Senior Notes.
"Senior Notes" means the Indebtedness evidenced by the promissory notes
from time to time issued by the Borrower under the Senior Note Indenture, as
such Indebtedness may be refinanced from time to time by Refinancing
Indebtedness.
"Senior Term Loan Agreement" means the Credit and Guaranty Agreement,
dated as of April 17, 2003, by and among the Borrower, certain Subsidiaries of
the Borrower as "Guarantors", ▇▇▇▇▇▇▇ Sachs Credit Partners L.P., as sole lead
arranger, sole bookrunner, and syndication agent, and the Senior Term Loan
Agreement Agent, together with the agreements, documents and instruments
delivered in connection therewith or issued pursuant thereto, including, without
limitation, the promissory notes issued thereunder and any guarantees, security
documents, mortgages and collateral agency agreement required thereunder, in
each case as the same may be amended, restated, supplemented or otherwise
modified from time to time.
"Senior Term Loan Agreement Agent" means ▇▇▇▇▇▇▇ ▇▇▇▇▇ Credit Partners
L.P., together with its successors and permitted assigns.
"Senior Term Loan Holders" means the Persons from time to time party to
the Senior Term Loan Agreement as "Lenders" and the Senior Term Loan Agreement
Agent.
"Senior Term Loans" means the Indebtedness incurred by the Borrower under
the Senior Term Loan Agreement, as such Indebtedness may be refinanced from time
to time by Refinancing Indebtedness.
"Single Employer Plan" means a Plan maintained by the Borrower or any
member of the Controlled Group for employees of the Borrower or any member of
the Controlled Group.
"Specified Customers" means nine customers of the Borrower and the
Subsidiary Guarantors from time to time identified as "Specified Customers" to
the Agent by the Borrower. The Agent may from time to time request that the
Borrower update or revise, to the Agent's reasonable satisfaction, the list of
"Specified Customers." The Agent agrees that it has received an initial list of
"Specified Customers" as of the Closing Date.
"SPV" means any special purpose entity established for the purpose of
purchasing Receivables in connection with a Receivables securitization
transaction permitted under the terms of this Agreement.
"Standard Reserve" means $40,000,000 unless the "Fixed Charge Coverage
Ratio", as calculated pursuant to Section 6.21 for each fiscal quarter based
upon the four then most-recently ended fiscal quarters, is less than 1.00 to
1.00, in which case "Standard Reserve" means the greater of $40,000,000 and 15%
of the then effective Borrowing Base (as calculated without giving effect to or
including the Standard Reserve, the first purchaser crude liability reserve and
the taxes held in trust/priming lien reserve and as the amount of such Borrowing
Base may
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change from time to time upon the delivery of Interim Collateral Reports or
Monthly Collateral Reports).
"Subordinated Indebtedness" means any Indebtedness the payment of which is
subordinated to the payment of the Secured Obligations to the written
satisfaction of the Agent and the Lenders.
"Subordinated Indebtedness Prepayment Conditions" means:
(x) if no Revolving Loans are outstanding immediately before or
after the applicable prepayment, defeasance, purchase, redemption,
retirement or acquisition, (1) no Default or Unmatured Default
exists, (2) Excess Availability equals or exceeds 25% of the
Borrowing Base then in effect and shall remain equal to or in excess
of 25% for the remainder of the day on which such prepayment is
made, and (3) the "Fixed Charge Coverage Ratio" as calculated in
Section 6.21 on a rolling four quarter basis equals or exceeds 1.10
to 1.00; and
(y) if Revolving Loans are outstanding immediately before or after
the applicable prepayment, defeasance, purchase, redemption,
retirement or acquisition, (1) no more than $100,000,000 of
Revolving Loan proceeds are used to make the applicable payments,
(2) no Default or Unmatured Default exists, (3) Excess Availability
equals or exceeds 35% of the Borrowing Base then in effect and shall
remain equal to or in excess of 35% for the remainder of the day on
which such prepayment is made, and (4) the "Fixed Charge Coverage
Ratio" as calculated in Section 6.21 on a rolling four quarter basis
exceeds 1.25 to 1.00.
"Subsidiary" of a Person means (i) any corporation more than 50% of the
outstanding securities having ordinary voting power of which shall at the time
be owned or controlled, directly or indirectly, by such Person or by one or more
of its Subsidiaries or by such Person and one or more of its Subsidiaries, or
(ii) any partnership, limited liability company, association, joint venture or
similar business organization more than 50% of the ownership interests having
ordinary voting power of which shall at the time be so owned or controlled.
Unless otherwise expressly provided, all references herein to a "Subsidiary"
shall mean a Subsidiary of the Borrower and no Excluded Subsidiary shall
constitute a Subsidiary of the Borrower.
"Subsidiary Guarantors" means each of the following Subsidiaries of the
Borrower subject to the Guaranty as of the Closing Date, together with those
other Persons organized under the laws of the United States or a political
subdivision thereof that become subject to the Guaranty in accordance with
Section 6.23 after the Closing Date, in each case together with its permitted
successors and assigns (including, without limitation, a debtor in possession on
its behalf): Tesoro Petroleum Companies, Inc., Digicomp, Inc., Tesoro Aviation
Company, Tesoro Financial Services Holding Company, Victory Finance Company,
Tesoro Alaska Company, Tesoro Northstore Company, Tesoro Hawaii Corporation,
Smiley's Super Service, Inc., Tesoro
29
Refining and Marketing Company, Tesoro Vostok Company, Tesoro Maritime Company,
Far East Maritime Company, Gold Star Maritime Company, Tesoro Wasatch, LLC,
Tesoro Trading Company, Tesoro Environmental Resources Company, and Tesoro Gas
Resources Company, Inc.
"Substantial Portion" means, with respect to the Property of the Borrower
and its Subsidiaries, Property which represents more than 10% of the
consolidated assets of the Borrower and its Subsidiaries or property which is
responsible for more than 10% of the consolidated net sales or of the
Consolidated Net Income of the Borrower and its Subsidiaries, in each case, as
would be shown in the consolidated financial statements of the Borrower and its
Subsidiaries, as at the end of the four fiscal quarter period ending with the
fiscal quarter immediately prior to the fiscal quarter in which such
determination is made (or if financial statements have not been delivered
hereunder for that fiscal quarter which ends the four fiscal quarter period,
then the financial statements delivered hereunder for the quarter ending
immediately prior to that quarter).
"Taxes" means any and all present or future taxes, duties, levies,
imposts, deductions, charges or withholdings, and any and all liabilities with
respect to the foregoing, but excluding Excluded Taxes.
"Termination Date" means the earlier of (a) June 30, 2007 and (b) the date
of termination in whole of the Aggregate Revolving Loan Commitment pursuant to
Section 2.4 hereof or the Revolving Loan Commitments pursuant to Section 8.1
hereof.
"Third Party Agreement" means a letter agreement, in form and substance
acceptable to the Agent, pursuant to which a landlord, bailee, consignee,
processor, warehouseman, or other third party who stores, processes, maintains
or holds Collateral acknowledges, among other things, the Agent's Lien on such
Collateral, the Agent's ability to enforce its Lien on such Collateral, and the
subordination of any Lien held by such landlord, bailee, consignee, processor,
warehouseman, or other third party on such Collateral to the Agent's Lien
thereon.
"Transferee" is defined in Section 12.4.
"Type" means, with respect to any Advance, its nature as a Floating Rate
Advance or a Eurodollar Advance, and with respect to any Loan, its nature as a
Floating Rate Loan or a Eurodollar Loan.
"Unencumbered Property Proceeds" means any amount constituting proceeds
from the sale of the Borrower's or any Subsidiary's Property (including proceeds
thereof) that does not constitute or qualify as Collateral or Property securing
amounts owing by the Borrower or its Subsidiaries to the Senior Noteholders
under the Senior Notes or the Senior Term Loan Holders under the Senior Term
Loan Agreement.
"Unfunded Liabilities" means the amount, if any, by which the current
liability as shown on line 1d(2)(a) of the most recently filed Schedule B of
Form 5500 under each Single Employer Plan subject to Title IV of ERISA exceeds
the fair market value of all such Plan's assets allocable to such benefits, all
determined as of the then most recent valuation date for such Plan for which a
Schedule B is available.
30
"Unmatured Default" means an event which but for the lapse of time or the
giving of notice, or both, would constitute a Default.
"US GAAP" means generally accepted accounting principles as in effect in
the United States from time to time.
"U.S." and "United States" means the United States of America.
"Wholly-Owned Subsidiary" of a Person means (i) any Subsidiary all of the
outstanding voting securities of which shall at the time be owned or controlled,
directly or indirectly, by such Person or one or more Wholly-Owned Subsidiaries
of such Person, or by such Person and one or more Wholly-Owned Subsidiaries of
such Person, or (ii) any partnership, limited liability company, association,
joint venture or similar business organization 100% of the ownership interests
having ordinary voting power of which shall at the time be so owned or
controlled.
1.2. Plural Forms. The foregoing definitions shall be equally applicable
to both the singular and plural forms of the defined terms.
ARTICLE II
THE CREDITS
2.1. Commitments; Loans.
2.1.1 Revolving Loans. From and including the Closing Date and prior
to the Termination Date, upon the satisfaction of the conditions precedent
set forth in Sections 4.1 and 4.2, as applicable, each Lender severally
and not jointly agrees, on the terms and conditions set forth in this
Agreement, to (i) make Revolving Loans to the Borrower from time to time
and (ii) participate in Facility LCs issued upon the request of the
Borrower, in each case in an amount not to exceed in the aggregate at any
one time outstanding of (a) with respect to Lenders with Revolving Loan
Commitments, such Lenders' respective Revolving Loan Pro Rata Shares of
the Available Aggregate Revolving Loan Commitment and (b) with respect to
Lenders with Pre-Funded Letter of Credit Commitments, such Lenders'
respective Pre-Funded Letter of Credit Pro Rata Shares of the Aggregate
Credit Linked Deposit not previously used to purchase participations in LC
Obligations, or, subsequent to the occurrence of a Conversion Event, other
portions of the Aggregate Outstanding Credit Exposure; provided that,
unless caused by a Collateral Protection Advance, at no time shall the
Aggregate Outstanding Credit Exposure hereunder exceed the Borrowing Base
and at no time shall the Aggregate Outstanding Credit Exposure minus the
Aggregate Pre-Funded Letter of Credit Commitment exceed the Aggregate
Revolving Loan Commitment; provided, further, that during the continuance
of a Conversion Event, all Lenders shall participate in the Aggregate
Outstanding Credit Exposure based on their respective Pro Rata Shares
thereof. Subject to the terms of this Agreement, the Borrower may borrow,
repay and reborrow Revolving Loans at any time prior to the Termination
Date. The commitment of each Lender to lend hereunder shall automatically
expire on the Termination Date. Each LC Issuer will issue Facility LCs
hereunder on the terms and conditions set forth in Section 2.19.
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2.1.2 Collateral Protection Advances. Subject to the limitations set
forth below, the Agent is authorized by the Borrower and the Lenders, from
time to time in the Agent's sole discretion, (i) during the existence of a
Default or an Unmatured Default, or (ii) at any time that any of the other
conditions precedent set forth in Article IV have not been satisfied, to
make Advances (each such advance to be a Floating Rate Advance) to the
Borrower on behalf of the Lenders in an aggregate amount outstanding at
any time not to exceed $10,000,000 which the Agent, in its reasonable
business judgment, deems necessary or desirable (A) to preserve or protect
the Collateral, or any portion thereof, (B) to enhance the likelihood of,
or maximize the amount of, repayment of the Secured Obligations, or (C) to
pay any other amount chargeable to or required to be paid by the Borrower
pursuant to the terms of this Agreement, including costs, fees, and
expenses as described in Section 9.6 (any of such Advances are herein
referred to as "Collateral Protection Advances"); provided that the
Required Lenders may at any time revoke the Agent's authorization to make
Collateral Protection Advances. Any such revocation must be in writing and
shall become effective prospectively upon the Agent's receipt thereof.
Absent such revocation, the Agent's determination that the making of a
Collateral Protection Advance is required for any such purposes shall be
conclusive. The Collateral Protection Advances shall be secured by the
Liens in favor of the Agent in and to the Collateral and shall constitute
Secured Obligations hereunder. Each Lender shall participate in each
Collateral Protection Advance in an amount equal to its Revolving Loan Pro
Rata Share thereof. No Collateral Protection Advance shall be made
hereunder if the result thereof causes (i) the Aggregate Outstanding
Credit Exposure to exceed the Aggregate Revolving Loan Commitment plus the
Aggregate Pre-Funded Letter of Credit Commitment or (ii) any Lender's ----
Revolving Loan Pro Rata Share thereof to exceed such Lender's Revolving
Loan Commitment.
2.1.3 Making of Non-Ratable Loans. If the Agent elects to have the
terms of this Section 2.1.3 apply to a Floating Rate Advance requested by
the Borrower in order to fund such Floating Rate Advance pursuant to this
Section 2.1.3 instead of Section 2.7, the Non-Ratable Lender shall make a
Floating Rate Advance in the amount requested available to the Borrower on
the applicable Borrowing Date by transferring same day funds to the
Borrower's funding account. Each Advance made solely by the Non-Ratable
Lender pursuant to this Section 2.1.3 is referred to in this Agreement as
a "Non-Ratable Loan," and such Advances are referred to as the
"Non-Ratable Loans." Each Non-Ratable Loan shall be subject to all the
terms and conditions applicable to other Advances funded by the Lenders,
except that all payments thereon shall be payable to the Non-Ratable
Lender solely for its own account. The Agent shall not request the
Non-Ratable Lender to make any Non-Ratable Loan if (A) the Agent has
received written notice from any Lender that one or more of the applicable
conditions precedent set forth in Article IV will not be satisfied on the
requested Borrowing Date for the applicable Non-Ratable Loan, or (B) the
requested Non-Ratable Loan exceeds the Available Aggregate Revolving Loan
Commitment (before giving effect to such Non-Ratable Loan) or would cause
the Aggregate Outstanding Credit Exposure (after giving effect to such
Non-Ratable Loan) to exceed the Borrowing Base on the applicable Borrowing
Date, or would cause the Aggregate Outstanding Credit Exposure (after
giving effect to such Non-Ratable Loan) minus the Aggregate Pre-Funded
Letter of Credit Commitment to exceed the Aggregate Revolving Loan
Commitment on the applicable Borrowing Date. The
32
Non-Ratable Loans shall be secured by the Liens granted to the Agent in
and to the Collateral and shall constitute Secured Obligations hereunder.
All Non-Ratable Loans shall be Floating Rate Advances. Each Lender shall
participate in each Non-Ratable Loan in an amount equal to its Revolving
Loan Pro Rata Share thereof.
2.1.4 Aggregate Credit Linked Deposit; Pre-Funded Letter of Credit
Account. Subject to the satisfaction of the conditions precedent set forth
in Sections 4.1 and 4.2, as applicable, each Lender with a Pre-Funded
Letter of Credit Commitment severally and not jointly agrees, on the terms
and conditions set forth in this Agreement, to remit to the Agent on the
Closing Date an amount equal to such Lender's then effective Pre-Funded
Letter of Credit Commitment. The Agent shall deposit such amounts into
account #2600466700 maintained with Bank One (the "Pre-Funded Letter of
Credit Account"). Such amounts shall be such Lenders' respective initial
Credit Linked Deposits and the aggregate of such amounts shall be the
initial Aggregate Credit Linked Deposit. No Lender shall be required to
make subsequent deposits into the Pre-Funded Letter of Credit Account
after its initial remittance to the Agent. The Agent shall at all times
have exclusive control of the Pre-Funded Letter of Credit Account and all
amounts on deposit therein, including, without limitation, the Credit
Linked Deposits. The Borrower shall have no right to the Pre-Funded Letter
of Credit Account and the amounts on deposit therein (including, without
limitation, the Credit Linked Deposits) and shall not have the ability to
direct the use of such deposits other than as provided in Section 2.19.6.
The Lenders' deposits into the Pre-Funded Letter of Credit Account and any
remittance of all or any portion of the Credit Linked Deposits to an LC
Issuer in respect of any draw made under a Facility LC shall not
constitute Loans or extensions of credit to the Borrower. In the event any
judicial or governmental entity re-characterizes the nature of the
Pre-Funded Letter of Credit Account and the Credit Linked Deposits and
deems the foregoing to be the Borrower's property or a Loan extended to
the Borrower, then the Borrower hereby grants to the Agent a security
interest in the Pre-Funded Letter of Credit Account and all amounts on
deposit therein, including, without limitation, the Aggregate Credit
Linked Deposit. Such grant shall be deemed made as of the date hereof.
2.2. Required Payments; Termination.
2.2.1 Generally. Any outstanding Advances and all other unpaid
Secured Obligations shall be paid in full by the Borrower on the
Termination Date. Notwithstanding the termination of the Revolving Loan
Commitments under this Agreement on the Termination Date, until all of the
Secured Obligations (other than contingent indemnity obligations) shall
have been fully paid and satisfied and all financing arrangements among
the Borrower and the Lenders hereunder and under the other Loan Documents
shall have been terminated, all of the rights and remedies under this
Agreement and the other Loan Documents shall survive. In addition to the
other mandatory prepayments required under this Agreement, if at any time
and for any reason, including, without limitation, as a result of the
reduction of the Aggregate Revolving Loan Commitment or a fluctuation of
the Borrowing Base, the Aggregate Outstanding Credit Exposure exceeds the
Borrowing Base, the Borrower shall immediately make a mandatory prepayment
of the Secured Obligations in an amount equal to such excess.
33
2.2.2 Asset Sales; Insurance Proceeds. Upon the consummation by the
Borrower or any Subsidiary of any sale of (i) Retail Property, and (ii)
any Property constituting Collateral (other than sales permitted under
Sections 6.12.1 and 6.12.2), in each case except to the extent that the
Net Cash Proceeds of such sale, when combined with the Net Cash Proceeds
of all such sales during the immediately preceding twelve-month period, do
not exceed $15,000,000 for any such sale or series of related sales,
within three (3) Business Days after the Borrower's or any of its
Subsidiaries' receipt of any Net Cash Proceeds from any such sale, or upon
the Borrower's receipt of Net Cash Proceeds under any insurance policy
covering Collateral as contemplated in Section 6.24, the Borrower shall
make a mandatory prepayment of the outstanding principal amount of the
Revolving Loans in the amount of such Net Cash Proceeds. Such mandatory
prepayment shall be applied in accordance with Section 2.2.5.
2.2.3 Financings. Upon the consummation of any Financing by the
Borrower or any Subsidiary of the Borrower (other than a Financing
consisting solely Refinancing Indebtedness), within three (3) Business
Days after the Borrower's or any of its Subsidiaries' receipt of any Net
Cash Proceeds from such Financing, the Borrower shall make a mandatory
prepayment of the outstanding principal amount of the Revolving Loans in
the amount of such Net Cash Proceeds. Such mandatory prepayment shall be
applied in accordance with Section 2.2.5.
2.2.4 Effect on Aggregate Revolving Loan Commitment. No prepayment
described in Sections 2.2.2 and 2.2.3 shall result in a reduction of the
Aggregate Revolving Loan Commitment and the Borrower may request an
Advance immediately after such prepayment so long as the terms and
conditions hereunder for an Advance have been satisfied.
2.2.5 Application and Priority of Mandatory Prepayments. The
Borrower shall remit a prepayment to the Agent in the amount of any Net
Cash Proceeds described in Section 2.2.2 or 2.2.3 on the dates required
under such Sections. The Agent shall deposit such prepayment in a
Collection Account or another cash collateral account subject to the
Agent's sole control and shall apply such prepayment to the Revolving
Loans. Any portion of such prepayment remaining thereafter shall be
returned to the Borrower for general corporate purposes. With respect to
the reduction of the Revolving Loans on any date, prepayments made under
Section 2.2.2 or 2.2.3 shall first be applied to Floating Rate Loans and
to any Eurodollar Rate Loans maturing on such date and then to
subsequently maturing Eurodollar Rate Loans in order of maturity.
2.2.6 Prepayment Fees.
(a) Aggregate Revolving Loan Commitment. If, prior to May 25, 2005,
the Borrower voluntarily reduces the Aggregate Revolving Loan Commitment
by more than the $100,000,000 permitted in Section 2.4.3 (any such
reduction, a "Revolver Prepayment Event"), then the Borrower shall pay to
the Agent for the benefit of the Lenders with Revolving Loan Commitments
in immediately available funds a prepayment fee on the date of such
Revolver Prepayment Event equal to the Aggregate Revolving Loan Commitment
in effect immediately prior to such reduction times 0.25%.
34
Notwithstanding the foregoing, the Borrower shall not be required to pay
any prepayment fee upon the occurrence of a Revolver Prepayment Event if
such Revolver Prepayment Event occurs contemporaneously with a refinancing
of the aggregate outstanding Obligations pursuant to a bank credit
facility provided or arranged by Bank One or an Affiliate thereof.
(b) If, prior to May 25, 2005, the Borrower causes the voluntary
reduction of the Aggregate Pre-Funded Letter of Credit Commitment to any
amount below $100,000,000 (any such reduction, a "Pre-Funded Letter of
Credit Early Reduction Event"), then the Borrower shall pay to the Agent
for the benefit of the Pre-Funded Lenders in immediately available funds a
prepayment fee on the date of such Pre-Funded Letter of Credit Early
Reduction Event equal to the amount of such reduction times 0.25%;
provided, however, that no such reduction shall occur if such reduction
would result in (i) the Aggregate Outstanding Credit Exposure exceeding
the Borrowing Base or (ii) the Aggregate Outstanding Credit Exposure
exceeding the Aggregate Revolving Loan Commitment plus the Aggregate
Pre-Funded Letter of Credit Commitment.
2.3. Ratable Loans; Types of Advances. (a) Each Advance hereunder (other
than a Non-Ratable Loan or a Collateral Protection Advance) shall consist of
Revolving Loans made from the several Lenders ratably in proportion to the ratio
that their respective Revolving Loan Commitments bear to the Aggregate Revolving
Loan Commitment.
(b) The Advances may be Floating Rate Advances or Eurodollar
Advances, or a combination thereof, selected by the Borrower in accordance with
Sections 2.7 and 2.8, or Non-Ratable Loans selected by the Borrower in
accordance with Section 2.1.3.
2.4. Commitment Fee; Aggregate Revolving Loan Commitment.
2.4.1 Commitment Fee. The Borrower shall pay to the Agent, for the
account of the Lenders with Revolving Loan Commitments in accordance with
their Revolving Loan Pro Rata Shares of the Aggregate Revolving Loan
Commitment, from and after the Closing Date until the date on which the
Aggregate Revolving Loan Commitment shall be terminated in whole, a
commitment fee (the "Commitment Fee") accruing daily at the rate of the
then Applicable Fee Rate on the Aggregate Revolving Loan Commitment minus
the Aggregate Outstanding Revolving Loan Credit Exposure, each as in
effect from time to time. All such Commitment Fees payable hereunder shall
be payable quarterly in arrears on each Payment Date.
2.4.2 Closing Fees. The Borrower shall pay to the Agent for the
ratable benefit of the Lenders on the Closing Date those closing fees
described in the fee letter dated May 25, 2004 by and among the Borrower,
the Agent and the Arranger, as amended or modified from time to time.
2.4.3 Reductions in Aggregate Revolving Loan Commitment. The
Borrower may permanently reduce the Aggregate Revolving Loan Commitment to
$0. Any such reduction shall require the payment of the prepayment fee
described in Section 2.2.6. The Borrower may permanently reduce the
Aggregate Revolving Loan Commitment
35
from the initial amount of $550,000,000 (or from such higher amount if the
Aggregate Revolving Loan Commitment has been increased pursuant to Section
2.20) by $100,000,000 in integral multiples of $10,000,000. No prepayment
fee under Section 2.2.6 shall be required with respect to such
$100,000,000 reduction. No other optional reduction of the Aggregate
Revolving Loan Commitment by the Borrower is permitted hereunder. Any such
permitted reduction may only occur upon at least three (3) Business Days'
written notice to the Agent, which notice shall specify the amount of any
such reduction, provided, however, that the amount of the Aggregate
Revolving Loan Commitment plus the Aggregate Pre-Funded Letter of Credit
Commitment may not be reduced below the Aggregate Outstanding Credit
Exposure, and the amount of the Aggregate Revolving Loan Commitment may
not be reduced below the Aggregate Outstanding Credit Exposure minus the
Aggregate Pre-Funded Letter of Credit Commitment. All accrued Commitment
Fees shall be payable on the effective date of any termination of the
obligations of the Lenders to make Credit Extensions hereunder and on the
final date upon which all Loans are repaid.
2.5. Minimum Amount of Each Advance. Each Eurodollar Advance shall be in
the minimum amount of $1,000,000 (and in multiples of $500,000 if in excess
thereof), and each Floating Rate Advance (other than an Advance to repay
Non-Ratable Loans or Collateral Protection Advances) shall be in the minimum
amount of $100,000 (and in multiples of $50,000 if in excess thereof), provided,
however, that any Floating Rate Advance may be in the amount of the Available
Aggregate Revolving Loan Commitment.
2.6. Optional Principal Payments; Optional Reductions of the Aggregate
Pre-Funded Letter of Credit Commitment. The Borrower may from time to time pay,
without penalty or premium, all outstanding Floating Rate Advances, or any
portion of the outstanding Floating Rate Advances. Subject to Section 2.2.6, the
Borrower may from time to time pay, subject to the payment of any funding
indemnification amounts required by Section 3.4 but without penalty or premium,
all outstanding Eurodollar Advances, or, in a minimum aggregate amount of
$1,000,000 or any integral multiple of $500,000 in excess thereof, any portion
of the outstanding Eurodollar Advances upon three (3) Business Days' prior
notice to the Agent. The Borrower may from time to time request reductions in
the Aggregate Pre-Funded Letter of Credit Commitment. So long as no Default is
then continuing, and subject to the remainder of this Section 2.6, the
Pre-Funded Lenders shall be obligated to accept the initial $25,000,000 of such
requested reductions. The Borrower may also request from time to time that the
Agent reduce the Aggregate Pre-Funded Letter of Credit Commitment in excess of
$25,000,000. Such additional reductions may be accepted in the sole discretion
of the Pre-Funded Lenders. Subsequent to the reduction of the Aggregate
Pre-Funded Letter of Credit Commitment by an initial $25,000,000, the Agent
shall notify the Pre-Funded Lenders each time the Borrower requests a further
reduction of the Aggregate Pre-Funded Letter of Credit Commitment. Each
Pre-Funded Lender shall have three Business Days from the date the Agent
transmits the Borrower's request to approve or reject such request. Failure by a
Pre-Funded Lender to respond to the Agent with respect to such request in
writing by the end of such three Business Day period shall be deemed to
constitute the approval thereof by such Pre-Funded Lender. At the end of such
three Business Day period, the Agent shall notify the Borrower of those
Pre-Funded Lenders consenting to the reduction of the Aggregate Pre-Funded
Letter of Credit Commitment. Those Pre-Funded Lenders that approve such
reduction shall have a ratable portion of their
36
respective Pre-Funded Letter of Credit Commitments reduced. No Lender that
rejects a reduction of the Aggregate Pre-Funded Letter of Credit Commitment
shall be subject to a reduction of its ratable portion thereof. Notwithstanding
the foregoing, if the Borrower requests a reduction of the Aggregate Pre-Funded
Letter of Credit Commitment to $0, the Agent and the Pre-Funded Lenders agree
that they shall consent to such request. In connection with any reduction of the
Aggregate Pre-Funded Letter of Credit Commitment, the Agent shall return to the
Pre-Funded Lenders subject to such reduction their ratable portion of the
Aggregate Credit Linked Deposit. The amount returned to a Pre-Funded Lender
shall equal the amount by which such Lender's Pre-Funded Letter of Credit
Commitment is reduced plus any investment return to which such Lender is
entitled under Section 2.19.4. In no event shall the Borrower request a
reduction of the Aggregate Pre-Funded Letter of Credit Commitment and neither
the Agent nor any Pre-Funded Lender shall approve a reduction in the Aggregate
Pre-Funded Letter of Credit Commitment if, subsequent to such reduction (i) the
Aggregate Outstanding Credit Exposure exceeds the Borrowing Base and (ii) the
Aggregate Outstanding Credit Exposure exceeds the Aggregate Revolving Loan
Commitment plus the Aggregate Pre-Funded Letter of Credit Commitment.
2.7. Method of Selecting Types and Interest Periods for New Advances. The
Borrower shall select the Type of Advance and, in the case of each Eurodollar
Advance, the Interest Period applicable thereto from time to time; provided that
there shall be no more than 8 Interest Periods in effect with respect to all of
the Loans at any time, unless such limit has been waived by the Agent in its
sole discretion; provided, further, that no Interest Period for Eurodollar
Advances during the "Syndication Period," as defined in the definition of
Interest Period, shall exceed seven days, and the Interest Periods with respect
to such Eurodollar Advances during the Syndication Period shall be required to
expire on the same date. The Borrower shall give the Agent irrevocable notice (a
"Borrowing Notice") not later than 12:00 noon (Chicago time) on the Borrowing
Date of each Floating Rate Advance (other than a Non-Ratable Loan) and three
Business Days before the Borrowing Date for each Eurodollar Advance, specifying:
(i) the Borrowing Date, which shall be a Business Day, of such Advance,
(ii) the aggregate amount of such Advance,
(iii) the Type of Advance selected, and
(iv) in the case of each Eurodollar Advance, the Interest Period
applicable thereto.
Not later than 2:00 p.m. (Chicago time) on each Borrowing Date, each Lender
shall make available its Loan or Loans in Federal or other funds immediately
available in Chicago to the Agent at its address specified pursuant to Article
XIII. The Agent will promptly make the funds so received from the Lenders
available to the Borrower at the Agent's aforesaid address.
2.8. Conversion and Continuation of Outstanding Advances; No Conversion or
Continuation of Eurodollar Advances After Default. Floating Rate Advances (other
than Non-Ratable Loans) shall continue as Floating Rate Advances unless and
until such Floating Rate Advances are converted into Eurodollar Advances
pursuant to this Section 2.8 or are repaid in
37
accordance with Section 2.6. Each Eurodollar Advance shall continue as a
Eurodollar Advance until the end of the then applicable Interest Period
therefor, at which time such Eurodollar Advance shall be automatically converted
into a Floating Rate Advance unless (x) such Eurodollar Advance is or was repaid
in accordance with Section 2.6 or (y) the Borrower shall have given the Agent a
Conversion/Continuation Notice (as defined below) requesting that, at the end of
such Interest Period, such Eurodollar Advance continue as a Eurodollar Advance
for the same or another Interest Period. Subject to the terms of Section 2.5,
the Borrower may elect from time to time to convert all or any part of an
Advance of any Type (other than a Non-Ratable Loan) into any other Type or Types
of Advances; provided that any conversion of any Eurodollar Advance shall be
made on, and only on, the last day of the Interest Period applicable thereto.
Notwithstanding anything to the contrary contained in this Section 2.8, during
the continuance of a Default or an Unmatured Default, the Agent may (or shall at
the direction of the Required Lenders), by notice to the Borrower, declare that
no Advance may be made, converted or continued as a Eurodollar Advance. The
Borrower shall give the Agent irrevocable notice (a "Conversion/Continuation
Notice") of each conversion of an Advance or continuation of a Eurodollar
Advance not later than 11:00 a.m. (Chicago time) at least one (1) Business Day,
in the case of a conversion into a Floating Rate Advance, or three (3) Business
Days, in the case of a conversion into or continuation of a Eurodollar Advance,
prior to the date of the requested conversion or continuation, specifying:
(i) the requested date, which shall be a Business Day, of such
conversion or continuation,
(ii) the aggregate amount and Type of the Advance which is to be
converted or continued, and
(iii) the amount of such Advance which is to be converted into or
continued as a Eurodollar Advance and the duration of the Interest
Period applicable thereto.
2.9. Changes in Interest Rate, etc. Each Floating Rate Advance (other than
a Non-Ratable Loan) shall bear interest on the outstanding principal amount
thereof, for each day from and including the date such Advance is made or is
automatically converted from a Eurodollar Advance into a Floating Rate Advance
pursuant to Section 2.8, to but excluding the date it is paid or is converted
into a Eurodollar Advance pursuant to Section 2.8 hereof, at a rate per annum
equal to the Floating Rate for such day. Changes in the rate of interest on that
portion of any Advance maintained as a Floating Rate Advance will take effect
simultaneously with each change in the Alternate Base Rate. Each Eurodollar
Advance shall bear interest on the outstanding principal amount thereof from and
including the first day of the Interest Period applicable thereto to (but not
including) the last day of such Interest Period at the Eurodollar Rate
determined by the Agent as applicable to such Eurodollar Advance based upon the
Borrower's selections under Sections 2.7 and 2.8 and otherwise in accordance
with the terms hereof. No Interest Period with respect to Revolving Loans may
end after the Termination Date and no investment period related to amounts owing
on the Credit Linked Deposits, as described in Section 2.19.4, may end after the
Termination Date.
2.10. Rates Applicable After Default. During the continuance of a Default
(including the Borrower's failure to pay any Loan at maturity), the Agent or the
Required Lenders may, at
38
their option, by notice to the Borrower (which notice may be revoked at the
option of the Required Lenders notwithstanding any provision of Section 8.2
requiring unanimous consent of the Lenders to changes in interest rates),
declare that (i) each Eurodollar Advance shall bear interest at the rate
otherwise applicable to such Interest Period plus 2% per annum, (ii) each
Floating Rate Advance shall bear interest at a rate per annum equal to the
Floating Rate in effect from time to time plus 2% per annum, (iii) amounts owing
in respect of Credit Linked Deposits shall accrue interest at the Pre-Funded
Letter of Credit LIBO Rate plus 2% per annum and (iv) each of the LC Fee and the
Pre-Funded Letter of Credit Fee shall be increased by 2% per annum; provided
that, during the continuance of a Default under Section 7.6 or 7.7, the interest
rates set forth in clauses (i), (ii) and (iii) above and the increase in each of
the LC Fee and the Pre-Funded Letter of Credit Fee set forth in clause (iv)
above shall be applicable to all Credit Extensions, Advances, fees and other
Obligations hereunder without any election or action on the part of the Agent or
any Lender.
2.11. Method of Payment; Settlement.
2.11.1 Method of Payment. All payments of the Obligations hereunder
shall be made, without setoff, deduction, or counterclaim, in immediately
available funds to the Agent at the Agent's address specified pursuant to
Article XIII, or at any other Lending Installation of the Agent specified
in writing by the Agent to the Borrower, by 12:00 p.m. (Chicago time) on
the date when due and shall (except in the case of Reimbursement
Obligations for which the applicable LC Issuer has not been fully
indemnified by the Lenders, or as otherwise specifically required
hereunder) be applied ratably by the Agent among the Lenders. Each payment
delivered to the Agent for the account of any Lender shall be delivered
promptly by the Agent to such Lender in the same type of funds that the
Agent received at its address specified pursuant to Article XIII or at any
Lending Installation specified in a notice received by the Agent from such
Lender. The Agent is hereby authorized to charge the account of the
Borrower maintained with Bank One for each payment of the Obligations as
it becomes due hereunder. The Agent is also hereby authorized to charge
each Collection Account into which Receivables collections and other
proceeds of Collateral are deposited. The Agent shall apply such amounts
on a daily basis to reduce outstanding Obligations. For purposes of
computing interest, fees and the Available Aggregate Revolving Loan
Commitment as of any date, (x) all amounts constituting immediately
available goods funds shall be deemed received by the Agent on the
Business Day on which such amounts are deposited into one of the
aforementioned Collection Accounts maintained with Bank One or an
Affiliate thereof, and (y) all amounts not constituting immediately
available good funds shall be deemed received by the Agent on the first
Business Day following the Business Day on which such amounts are
deposited into one of the aforementioned Collection Accounts maintained
with Bank One or an Affiliate thereof. In the event any such amount is
applied and the payment item evidencing such amount is subsequently
dishonored, returned for insufficient funds, required to be returned to
the applicable Account Debtor, or required to be remitted to a Person
other than the Agent or a Lender, the Obligations shall be increased by
the amount originally applied in reduction thereof and interest shall be
deemed to have accrued on such amount from the Business Day on which such
amount was originally credited as a reduction of the Obligations through
the Business Day on which such amount is repaid. The Borrower shall also
be required to pay any
39
fees that would have accrued during such period had such amount not been
deemed paid during such period. Each reference to the Agent in this
Section 2.11 shall also be deemed to refer, and shall apply equally, to
each LC Issuer in the case of payments required to be made by the Borrower
to such LC Issuer pursuant to Section 2.19.6.
2.11.2 Settlement. (a) Each Lender's funded portion of any Advance
is intended by the Lenders to be equal at all times to such Lender's Pro
Rata Share of such Advance; provided, however, that for purposes of this
Section 2.11.2 and all other applicable provisions of this Agreement, only
Lenders with Revolving Loan Commitments shall participate in Collateral
Protection Advances and Non-Ratable Loans in amounts equal to their
respective Revolving Loan Pro Rata Shares thereof. Notwithstanding such
agreement, the Agent, the Non-Ratable Lender (with respect to the
Non-Ratable Loans), and the Lenders agree (which agreement shall not be
for the benefit of or enforceable by the Borrower) that in order to
facilitate the administration of this Agreement and the other Loan
Documents, settlement among them as to any Advance, including the
Non-Ratable Loans and the Collateral Protection Advances, shall take place
on a periodic basis in accordance with this Section 2.11.2.
(b) The Agent shall request settlement (a "Settlement") with the
Lenders on at least a weekly basis, or on a more frequent basis at the
Agent's election, (A) on behalf of the Non-Ratable Lender, with respect to
each outstanding Non-Ratable Loan, (B) for itself, with respect to each
Collateral Protection Advance, and (C) with respect to collections
received, in each case, by notifying the Lenders of such requested
Settlement by telephone or facsimile, no later than 12:30 p.m. (Chicago
time) on the date of such requested Settlement (the "Settlement Date").
Each Lender (other than the Non-Ratable Lender, in the case of the
Non-Ratable Loans, and the Agent in the case of the Collateral Protection
Advances) shall transfer the amount of such Lender's Pro Rata Share of the
outstanding principal amount of the applicable Advances with respect to
which Settlement is requested to the Agent, to such account of the Agent
as the Agent may designate, not later than 2:30 p.m. (Chicago time), on
the Settlement Date applicable thereto. Settlements may occur during the
existence of a Default or an Unmatured Default and whether or not the
applicable conditions precedent set forth in Article IV have then been
satisfied. Such amounts transferred to the Agent shall be applied against
the amounts of the applicable Non-Ratable Loan or Collateral Protection
Advance and, together with the portion of such Non-Ratable Loan or
Collateral Protection Advance representing the Non-Ratable Lenders or the
Agent's Pro Rata Share thereof, shall constitute Revolving Loans of such
Lenders, respectively. If any such amount is not transferred to the Agent
by any Lender on the Settlement Date applicable thereto, the Agent shall
be entitled to recover such amount on demand from such Lender together
with interest thereon at the Alternate Base Rate for the first three days
from and after the Settlement Date and thereafter at the then applicable
Floating Rate (1) on behalf of the Non-Ratable Lender with respect to each
outstanding Non-Ratable Loan and (2) for itself with respect to each
Collateral Protection Advance.
(c) Notwithstanding the foregoing, not more than one Business Day
after demand is made by the Agent (whether before or after the occurrence
of a Default or an Unmatured Default and regardless of whether the Agent
has requested a Settlement with
40
respect to a Non-Ratable Loan or Collateral Protection Advance), each
other Lender (A) shall irrevocably and unconditionally purchase and
receive from the Non-Ratable Lender or the Agent, as applicable, without
recourse or warranty, an undivided interest and participation in such
Non-Ratable Loan or Collateral Protection Advance equal to such Lender's
Pro Rata Share of such Non-Ratable Loan or Collateral Protection Advance,
and (B) if Settlement has not previously occurred with respect to such
Non-Ratable Loans or Collateral Protection Advances, upon demand by the
Agent or the Non-Ratable Lender, as applicable, shall pay to the Agent or
the Non-Ratable Lender, as applicable, as the purchase price of such
participation an amount equal to 100% of such Lender's Pro Rata Share of
such Non-Ratable Loans or Collateral Protection Advances. If such amount
is not in fact transferred to the Agent or the Non-Ratable Lender, as
applicable, by any Lender, the Agent shall be entitled to recover such
amount on demand from such Lender together with interest thereon at the
Alternate Base Rate for the first three days from and after such demand
and thereafter at the then applicable Floating Rate.
(d) From and after the date, if any, on which any Lender purchases
an undivided interest and participation in any Non-Ratable Loan or
Collateral Protection Advance pursuant to Section 2.11.2(c), the Agent
shall promptly distribute to such Lender such Lender's Pro Rata Share of
all payments of principal and interest and all proceeds of Collateral
received by the Agent in respect of such Non-Ratable Loan or Collateral
Protection Advance.
(e) Between Settlement Dates, to the extent no Collateral Protection
Advances are outstanding, the Agent may pay over to the Non-Ratable Lender
any payments received by the Agent, which in accordance with the terms of
this Agreement would be applied to the reduction of the Revolving Loans,
for application to the Non-Ratable Lender's Revolving Loans including
Non-Ratable Loans. If, as of any Settlement Date, collections received
since the then immediately preceding Settlement Date have been applied to
the Non-Ratable Lender's Revolving Loans (other than to Non-Ratable Loans
or Collateral Protection Advances in which a Lender has not yet funded its
purchase of a participation pursuant to Section 2.11.2(c)), as provided
for in the previous sentence, the Non-Ratable Lender shall pay to the
Agent for the accounts of the Lenders, to be applied to the outstanding
Revolving Loans of such Lenders, an amount such that each Lender shall,
upon receipt of such amount, have, as of such Settlement Date, its Pro
Rata Share of the Revolving Loans. Subject to Section 2.11.1, during the
period between Settlement Dates, the Non-Ratable Lender with respect to
Non-Ratable Loans, the Agent with respect to Collateral Protection
Advances, and each Lender with respect to the Revolving Loans other than
Non-Ratable Loans and Collateral Protection Advances, in each case ratably
in accordance with the funds employed by each of them, shall be entitled
to interest at the applicable rate or rates payable under this Agreement
on the actual average daily amount of funds employed by the Non-Ratable
Lender, the Agent, and the other Lenders.
2.12. Noteless Agreement; Evidence of Indebtedness. (i) Each Lender shall
maintain in accordance with its usual practice an account or accounts evidencing
the indebtedness of the Borrower to such Lender resulting from each Loan made by
such Lender from time to time,
41
including the amounts of principal and interest payable and paid to such Lender
from time to time hereunder.
(ii) The Agent shall also maintain accounts in which it will record (a)
the date and the amount of each Loan made hereunder, the Type
thereof and the Interest Period (in the case of a Eurodollar
Advance) with respect thereto, (b) the amount of any principal or
interest due and payable or to become due and payable from the
Borrower to each Lender hereunder, (c) the original stated amount of
each Facility LC and the amount of LC Obligations outstanding at any
time, (d) the effective date and amount of each Assignment Agreement
delivered to and accepted by it and the parties thereto pursuant to
Section 12.3, (e) the amount of any sum received by the Agent
hereunder from the Borrower and each Lender's share thereof, and (f)
all other appropriate debits and credits as provided in this
Agreement, including, without limitation, all fees, charges,
expenses and interest.
(iii) The entries maintained in the accounts maintained pursuant to
paragraphs (i) and (ii) above shall be prima facie evidence of the
existence and amounts of the Obligations therein recorded; provided,
however, that the failure of the Agent or any Lender to maintain
such accounts or any error therein shall not in any manner affect
the obligation of the Borrower to repay the Obligations in
accordance with their terms.
(iv) Any Lender may request that its Revolving Loans be evidenced by a
promissory note in substantially the form of Exhibit E (a "Note").
In such event, the Borrower shall prepare, execute and deliver to
such Lender the appropriate Note payable to the order of such
Lender. Thereafter, the Loans evidenced by such Note and interest
thereon shall at all times (prior to any assignment pursuant to
Section 12.3) be represented by one or more Notes payable to the
order of the payee named therein, except to the extent that any such
Lender subsequently returns any such Note for cancellation and
requests that such Loans once again be evidenced as described in
paragraphs (i) and (ii) above.
2.13. Telephonic Notices. The Borrower hereby authorizes the Lenders and
the Agent to extend, convert or continue Advances, effect selections of Types of
Advances and to transfer funds based on telephonic notices made by any person or
persons the Agent or any Lender in good faith believes to be acting on behalf of
the Borrower, it being understood that the foregoing authorization is
specifically intended to allow Borrowing Notices and Conversion/Continuation
Notices to be given telephonically. The Borrower agrees to deliver promptly to
the Agent a written confirmation, signed by an Authorized Officer, if such
confirmation is requested by the Agent or any Lender, of each telephonic notice.
If the written confirmation differs in any material respect from the action
taken by the Agent and the Lenders, the records of the Agent and the Lenders
shall govern absent manifest error.
2.14. Payments of Interest.
2.14.1 Interest Payment Dates; Interest and Fee Basis. Fees and
other amounts owing in respect of the Credit Linked Deposits shall be paid
in accordance with Section
42
2.19.4. With respect to all Advances, interest shall be payable as
follows. Interest accrued on each Floating Rate Advance shall be payable
in arrears on each Payment Date, commencing with the first such date to
occur after the Closing Date, and at maturity, whether due to acceleration
or otherwise. Interest accrued on each Eurodollar Advance shall be payable
on the last day of its applicable Interest Period, on any date on which
the Eurodollar Advance is prepaid, whether by acceleration or otherwise,
and at maturity. Interest accrued on each Eurodollar Advance having an
Interest Period longer than three months shall also be payable on the last
day of each three-month interval during such Interest Period. Interest on
Eurodollar Advances, Pre-Funded Letter of Credit Fees, LC Fees and all
other fees hereunder, and amounts owing in respect of Credit Linked
Deposits shall be calculated for actual days elapsed on the basis of a
360-day year. Interest on Floating Rate Advances shall be calculated for
actual days elapsed on the basis of a 365/366-day year. Interest shall be
payable for the day an Advance is made but not for the day of any payment
(unless payment is on the same date as the Advance) on the amount paid if
payment is received prior to 12:00 p.m. (Chicago time) at the place of
payment. If any payment of principal of or interest on an Advance, any
fees or any other amounts payable to the Agent or any Lender hereunder
shall become due on a day which is not a Business Day, such payment shall
be made on the next succeeding Business Day and, in the case of a
principal payment, such extension of time shall be included in computing
interest, fees and commissions in connection with such payment.
2.14.2 Limitation on Interest. The Borrower, the Agent and the
Holders of Secured Obligations intend to strictly comply with all
applicable laws, including applicable usury laws. Accordingly, the
provisions of this Section 2.14.2 shall govern and control over every
other provision of this Agreement or any other Loan Document which
conflicts or is inconsistent with this Section 2.14.2, even if such
provision declares that it controls. As used in this Section 2.14.2, the
term "interest" includes the aggregate of all charges, fees, benefits, or
other compensation which constitute interest under applicable law,
provided that, to the maximum extent permitted by applicable law, (a) any
non-principal payment shall be characterized as an expense or as
compensation for something other than the use, forbearance, or detention
of money and not as interest and (b) all interest at any time contracted
for, reserved, charged, or received shall be amortized, prorated,
allocated, and spread, in equal parts during the full term of the Secured
Obligations. In no event shall the Borrower or any other Person be
obligated to pay, or any Holder of Secured Obligations have any right or
privilege to reserve, receive, or retain, (i) any interest in excess of
the maximum amount of nonusurious interest permitted under the laws of the
State of New York or the applicable laws (if any) of the U.S. or of any
other applicable state or (ii) total interest in excess of the amount
which such Holder of Secured Obligations could lawfully have contracted
for, reserved, received, retained, or charged had the interest been
calculated for the full term of the Secured Obligations at the Highest
Lawful Rate. On each day, if any, that the interest rate (the "Stated
Rate") called for under this Agreement or any other Loan Document exceeds
the Highest Lawful Rate, the rate at which interest shall accrue shall
automatically be fixed by operation of this sentence at the Highest Lawful
Rate for that day, and shall remain fixed at the Highest Lawful Rate for
each day thereafter until the total amount of interest accrued equals the
total amount of interest which would have accrued if there were no such
ceiling rate as is imposed by this sentence. Thereafter,
43
interest shall accrue at the Stated Rate unless and until the Stated Rate
again exceeds the Highest Lawful Rate when the provisions of the
immediately preceding sentence shall again automatically operate to limit
the interest accrual rate. The daily interest rates to be used in
calculating interest at the Highest Lawful Rate shall be determined by
dividing the applicable Highest Lawful Rate per annum by the number of
days in the calendar year for which such calculation is being made. None
of the terms and provisions contained in this Agreement or in any other
Loan Document which directly or indirectly relate to interest shall ever
be construed without reference to this Section 2.14.2, or be construed to
create a contract to pay for the use, forbearance, or detention of money
at an interest rate in excess of the Highest Lawful Rate. If the term of
any Secured Obligation is shortened by reason of acceleration of maturity
as a result of any Default or by any other cause, or by reason of any
required or permitted prepayment, and if for that (or any other) reason
any Holder of Secured Obligations at any time, including but not limited
to, the stated maturity, is owed or receives (and/or has received)
interest in excess of interest calculated at the Highest Lawful Rate, then
and in any such event all of any such excess interest shall be canceled
automatically as of the date of such acceleration, prepayment, or other
event which produces the excess, and, if such excess interest has been
paid to such Holder of Secured Obligations, it shall be credited pro tanto
against the then outstanding principal balance of the Borrower's
obligations to such Holder of Secured Obligations, effective as of the
date or dates when the event occurs which causes it to be excess interest,
until such excess is exhausted or all of such principal has been fully
paid and satisfied, whichever occurs first, and any remaining balance of
such excess shall be promptly refunded to its payor. Chapter 346 of the
Texas Finance Code (which regulates certain revolving credit accounts
(formerly Tex. Rev. Civ. Stat. ▇▇▇. Art. ▇▇▇▇, ▇▇. 15)) shall not apply to
this Agreement or to any Loan, nor shall this Agreement or any Loan be
governed by or be subject to the provisions of such Chapter 346 in any
manner whatsoever.
2.15. Notification of Advances, Interest Rates, Prepayments and Revolving
Loan Commitment Reductions; Availability of Loans. Promptly after receipt
thereof, the Agent will notify each Lender of the contents of each Aggregate
Revolving Loan Commitment reduction notice, Borrowing Notice,
Conversion/Continuation Notice, and repayment notice received by it hereunder.
Promptly after notice from the applicable LC Issuer, the Agent will notify each
Lender of the contents of each request for issuance of a Facility LC hereunder.
The Agent will notify the Borrower and each Lender of the interest rate
applicable to each Eurodollar Advance promptly upon determination of such
interest rate and will give the Borrower and each Lender prompt notice of each
change in the Alternate Base Rate. Not later than 2:00 p.m. (Chicago time) on
each Borrowing Date, each Lender shall make available its Loan or Revolving
Loans in funds immediately available in Chicago to the Agent at its address
specified pursuant to Article XIII. The Agent will promptly make the funds so
received from the Lenders available to the Borrower at the Agent's aforesaid
address.
2.16. Lending Installations. Each Lender may book its Loans and its
participation in any LC Obligations and other Obligations and each LC Issuer may
book its Facility LCs at any Lending Installation selected by such Lender or
such LC Issuer, as applicable, and may change its Lending Installation from time
to time. All terms of this Agreement shall apply to any such Lending
Installation and the Loans, Facility LCs, and participations in LC Obligations
and other
44
Obligations, and any Notes issued hereunder shall be deemed held by each Lender
or the relevant LC Issuer, for the benefit of any such Lending Installation.
Each Lender and each LC Issuer may, by written notice to the Agent and the
Borrower in accordance with Article XIII, designate replacement or additional
Lending Installations through which Loans will be made by it or Facility LCs
will be issued by it and for whose account Loan payments or payments with
respect to Facility LCs are to be made.
2.17. Non-Receipt of Funds by the Agent. Unless the Borrower or a Lender,
as the case may be, notifies the Agent prior to the date on which it is
scheduled to make payment to the Agent of (i) in the case of a Lender, the
proceeds of a Loan or (ii) in the case of the Borrower, a payment of principal,
interest or fees to the Agent for the account of the Lenders, that it does not
intend to make such payment, the Agent may assume that such payment has been
made. The Agent may, but shall not be obligated to, make the amount of such
payment available to the intended recipient in reliance upon such assumption. If
such Lender or the Borrower, as the case may be, has not in fact made such
payment to the Agent, the recipient of such payment shall, on demand by the
Agent, repay to the Agent the amount so made available together with interest
thereon in respect of each day during the period commencing on the date such
amount was so made available by the Agent until the date the Agent recovers such
amount at a rate per annum equal to (x) in the case of payment by a Lender, the
Federal Funds Effective Rate for such day for the first three days and,
thereafter, the interest rate applicable to the relevant Loan or (y) in the case
of payment by the Borrower, the interest rate applicable to the relevant Loan.
2.18. Replacement of Lender. If (i) the Borrower is required pursuant to
Section 3.1, 3.2 or 3.5 to make any additional payment to any Lender or if any
Lender's obligation to make or continue, or to convert Floating Rate Advances
into, Eurodollar Advances shall be suspended pursuant to Section 3.3 or (ii) any
Lender refuses to consent to certain proposed amendments, modifications,
waivers, discharges or terminations with respect to this Agreement that require
the consent of all Lenders (or all affected Lenders) pursuant to Section 8.2 and
the same have been approved by the Required Lenders (any Lender described in
clause (i) or clause (ii) being an "Affected Lender"), the Borrower may elect to
terminate or replace the Revolving Loan Commitment of such Affected Lender and
such Lender's Pre-Funded Letter of Credit Pro Rata Share of the Aggregate Credit
Linked Deposit, provided that no Default or Unmatured Default shall have
occurred and be continuing at the time of such termination or replacement, and
provided further that, concurrently with such termination or replacement, (i) if
the Affected Lender is being replaced, another bank or other entity which is
reasonably satisfactory to the Borrower and the Agent shall agree, as of such
date, to purchase for cash the Outstanding Credit Exposure of the Affected
Lender pursuant to an Assignment Agreement substantially in the form of Exhibit
C and to become a Lender for all purposes under this Agreement and to assume all
obligations of the Affected Lender to be terminated as of such date and to
comply with the requirements of Section 12.3 applicable to assignments, and (ii)
the Borrower shall pay to such Affected Lender in immediately available funds on
the day of such replacement (A) all interest, fees and other amounts then
accrued but unpaid to such Affected Lender by the Borrower hereunder to and
including the date of termination, including without limitation payments due to
such Affected Lender under Sections 3.1, 3.2 and 3.5, and (B) an amount, if any,
equal to the payment which would have been due to such Lender on the day of such
replacement under Section 3.4 had the Loans of such Affected Lender been prepaid
on such date rather than sold to the replacement Lender, in each case to the
extent not paid by the purchasing lender and (iii) if
45
the Affected Lender is being terminated, the Borrower shall pay to such Affected
Lender all Obligations due to such Affected Lender (including the amounts
described in the immediately preceding clauses (i) and (ii) plus the outstanding
principal balance of such Affected Lender's Credit Extensions).
2.19. Facility LCs.
2.19.1 Issuance. Each LC Issuer hereby agrees, on the terms and
conditions set forth in this Agreement, to issue standby and commercial
letters of credit (each, a "Facility LC") and to renew, extend, increase,
decrease or otherwise modify each Facility LC ("Modify," and each such
action, a "Modification"), from time to time from and including the date
of this Agreement and prior to the Termination Date upon the request of
the Borrower or any Subsidiary Guarantor; provided that immediately after
each such Facility LC is issued or Modified, (i) the aggregate amount of
the outstanding LC Obligations shall not exceed $650,000,000, (ii) the
Aggregate Outstanding Credit Exposure shall not exceed the Borrowing Base
and (iii) the Aggregate Outstanding Credit Exposure shall not exceed the
Aggregate Revolving Loan Commitment plus the ---- Aggregate Pre-Funded
Letter of Credit Commitment. Any reference in this Section 2.19 to a
request for a Facility LC by the Borrower shall be deemed to include
requests by any Subsidiary Guarantor. The Borrower agrees that it is
obligated to satisfy any amount arising under or in connection with
Facility LCs issued hereunder at the request of any Subsidiary Guarantor,
including, without limitation, all Reimbursement Obligations, and that no
Facility LC requested by any such Person shall be issued hereunder unless
all conditions to issuance have been satisfied. No Facility LC shall have
an expiry date later than the earlier of (x) the fifth Business Day prior
to the Termination Date and (y) one year after its issuance; provided,
however, that any Facility LC with a one-year term may provide for the
renewal thereof for additional one-year periods that do not extend beyond
the date referenced in clause (x) hereof. Schedule 2.19.1 sets forth
certain letters of credit issued under the Prior Credit Agreement. Subject
to the satisfaction on the Closing Date of the conditions precedent set
forth in Sections 4.1 and 4.2, such letters of credit shall constitute, on
and after the Closing Date, Facility LCs and shall be subject to and
benefit from this Agreement.
2.19.2 Participations. Upon the issuance or Modification by an LC
Issuer of a Facility LC in accordance with this Section 2.19, such LC
Issuer shall be deemed, without further action by any party hereto, to
have unconditionally and irrevocably sold to each Lender, and each Lender
shall be deemed, without further action by any party hereto, to have
unconditionally and irrevocably purchased from such LC Issuer, a
participation in such Facility LC (and each Modification thereof) and the
related LC Obligations in proportion to its Facility LC Pro Rata Share
thereof; provided, however, that no Lender with a Credit Linked Deposit
shall be required to make such a purchase in excess of the amount of its
Credit Linked Deposit or its Pre-Funded Letter of Credit Commitment and
such purchase shall only be made with the proceeds of such Lender's Credit
Linked Deposit. The Agent shall notify the Lenders of their Facility LC
Pro Rata Shares of the then outstanding LC Obligations on each Settlement
Date and on each date on which a Facility LC is issued, Modified, drawn or
terminated, in each case after giving effect to the applicable issuance,
Modification, draw or termination.
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2.19.3 Notice. Subject to Section 2.19.1, the Borrower shall give
the applicable LC Issuer notice prior to 12:00 noon (Chicago time) at
least one Business Day prior to the proposed date of issuance or
Modification of the applicable Facility LC, specifying the beneficiary,
the proposed date of issuance (or Modification) and the expiry date of
such Facility LC, and describing the proposed terms of such Facility LC
and the nature of the transactions proposed to be supported thereby. Upon
receipt of such notice, the applicable LC Issuer shall promptly notify the
Agent, and the Agent shall promptly notify each Lender, of the contents
thereof and of the amount of such Lender's Facility LC Pro Rata Share of
the Lenders' aggregate participation in such proposed Facility LC. The
issuance or Modification by the applicable LC Issuer of a Facility LC
shall, in addition to the conditions precedent set forth in Article IV
(the satisfaction of which the applicable LC Issuer shall have no duty to
ascertain), be subject to the conditions precedent that such Facility LC
shall be satisfactory to the applicable LC Issuer and that the Borrower
shall have executed and delivered such application agreement and/or such
other instruments and agreements relating to such Facility LC as the
applicable LC Issuer shall have reasonably requested (each, a "Facility LC
Application"). In the event of any conflict between the terms of this
Agreement and the terms of any Facility LC Application, the terms of this
Agreement shall control.
2.19.4 LC Fees; Pre-Funded Letter of Credit Fees; Return on
Aggregate Credit Linked Deposit.
(a) The Borrower shall pay to the Agent, for the account of the
Lenders with Revolving Loan Commitments (or, if the Revolving Loan Commitments
have terminated, Outstanding Revolving Loan Credit Exposure) ratably in
accordance with their respective Facility LC Pro Rata Shares, with respect to
issued and outstanding Facility LCs, a letter of credit fee at a per annum rate
equal to the Applicable Margin for Revolving Loans that are Eurodollar Loans in
effect from time to time on the maximum stated amount under such Facility LCs,
with such fee to be payable in arrears on each Payment Date. No Lender with a
Revolving Loan Commitment shall receive any such letter of credit fee until such
time as the LC Obligations exceed the Aggregate Pre-Funded Letter of Credit
Commitment then in effect and such letter of credit fee shall only be payable to
such Lenders on the amount of the LC Obligations in excess of the Aggregate
Pre-Funded Letter of Credit Commitment then in effect. The Borrower shall pay to
the Agent, for the account of the Pre-Funded Lenders ratably in accordance with
their respective Facility LC Pro Rata Shares, a fee at a per annum rate equal to
the Aggregate Pre-Funded Letter of Credit Commitment times the Pre-Funded Letter
of Credit Rate in effect from time to time, with such fee to be paid in arrears
on each Payment Date. The foregoing fees shall be payable in the manner
described above regardless of whether or not a Conversion Event is then
continuing. The Borrower shall also pay to the applicable LC Issuer for its own
account (x) on the first Payment Date to occur after the issuance of a Facility
LC issued by such LC Issuer, a fronting fee in an amount equal to 0.125% per
annum times the face amount of such Facility LC, and (y) documentary and
processing charges in connection with the issuance, amendment, cancellation,
negotiation, transfer, or other Modification of and draws under Facility LCs in
accordance with such LC Issuer's standard schedule for such charges as in effect
from time to time. Each fee described in this Section 2.19.4, other than those
paid to the Pre-Funded Lenders, shall constitute an "LC Fee". Each fee described
in this Section 2.19.4 that is paid to the Pre-Funded Lenders shall constitute a
"Pre-Funded Letter of Credit Fee".
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(b) The Agent shall invest the Aggregate Credit Linked Deposit from
time to time in such a manner as is necessary to receive a return on such
investment (the "Pre-Funded Investment Earnings") equal to or greater than the
Pre-Funded Letter of Credit LIBO Rate, as such rate may change from time to
time. The Pre-Funded Letter of Credit LIBO Rate shall be calculated using a
one-month interest period. Pre-Funded Lenders shall receive on each Payment Date
their Pre-Funded Letter of Credit Pro Rata Shares of the Pre-Funded Investment
Earnings; provided, however, that, so long as no Default is then continuing, if
on any Payment Date the aggregate amount of Pre-Funded Investment Earnings then
available exceeds the return then required to be paid (as calculated using the
applicable Pre-Funded Letter of Credit LIBO Rate) to the Pre-Funded Lenders, the
Agent shall remit to the Borrower such excess. If on any Payment Date the return
on investment then payable (as calculated using the applicable Pre-Funded Letter
of Credit LIBO Rate) to the Pre-Funded Lenders exceeds the Pre-Funded Investment
Earnings then available, the Borrower shall remit to the Agent on such Payment
Date an amount equal to such deficiency. A Default shall occur if the Borrower
does not remit to the Agent such amounts, if any, as are necessary to pay the
Lenders with Credit Linked Deposits the investment return due and payable on any
Payment Date. The Agent shall not be liable for any loss (including, without
limitation, breakage amounts) resulting from any investment of all or any
portion of the Aggregate Credit Linked Deposit or any use of Pre-Funded
Investment Earnings to make any payment to the Pre-Funded Lenders hereunder
unless the Agent is grossly negligent or has engaged in willful misconduct in
connection with the investment of all or the applicable portion of the Aggregate
Credit Linked Deposit.
2.19.5 Administration; Reimbursement by Lenders. Upon receipt from
the beneficiary of any Facility LC of any demand for payment under such
Facility LC, the applicable LC Issuer shall notify the Agent and the Agent
shall promptly notify the Borrower and each other Lender as to the amount
to be paid by such LC Issuer as a result of such demand and the proposed
payment date (the "LC Payment Date"). The responsibility of the applicable
LC Issuer to the Borrower and each Lender shall be only to determine that
the documents (including each demand for payment) delivered under each
Facility LC issued by such LC Issuer in connection with such presentment
shall be in conformity in all material respects with such Facility LC.
Each LC Issuer shall endeavor to exercise the same care in the issuance
and administration of its Facility LCs as it does with respect to letters
of credit in which no participations are granted, it being understood that
in the absence of any gross negligence or willful misconduct by such LC
Issuer, each Lender shall be unconditionally and irrevocably liable
without regard to the occurrence of any Default or any condition precedent
whatsoever, to reimburse such LC Issuer on demand for (i) such Lender's
(x) Facility LC Pro Rata Share prior to the occurrence of a Conversion
Event and (y) Pro Rata Share during the continuance of a Conversion Event,
of the amount of each payment made by such LC Issuer under each Facility
LC issued by it to the extent such amount is not reimbursed by the
Borrower pursuant to Section 2.19.6 below or, if applicable, by a
withdrawal from the Pre-Funded Letter of Credit Account pursuant to
Section 2.19.6 below, plus (ii) interest on the foregoing amount to be
reimbursed by such Lender, for each day from the date of such LC Issuer's
demand for such reimbursement (or, if such demand is made after 11:00 a.m.
(Chicago time) on such date, from the next succeeding Business Day) to the
date on which such Lender pays the amount to be reimbursed by it, at a
rate of interest per annum equal to the Federal Funds Effective Rate for
the first three days and, thereafter, at a rate
48
of interest equal to the rate applicable to Floating Rate Advances. With
respect to any Pre-Funded Lender, such reimbursement obligation shall not
exceed the amount of its Pre-Funded Letter of Credit Commitment or its
Credit Linked Deposit and shall be satisfied solely with the proceeds of
such Credit Linked Deposit. The Lenders shall be reimbursed for any
payment required under this Section 2.19.5 to the extent of such Lender's
Facility LC Pro Rata Share, or Pro Rata Share, as applicable, of any
payment made by the Borrower as required under Section 2.19.6.
2.19.6 Reimbursement by Borrower. The Borrower shall be irrevocably
and unconditionally obligated to reimburse each LC Issuer on or before the
applicable LC Payment Date for any amounts to be paid by such LC Issuer
upon any drawing under any Facility LC, issued by it, without presentment,
demand, protest or other formalities of any kind; provided that neither
the Borrower nor any Lender shall hereby be precluded from asserting any
claim for direct (but not consequential) damages suffered by the Borrower
or such Lender to the extent, but only to the extent, caused by (i) the
willful misconduct or gross negligence of such LC Issuer in determining
whether a request presented under any Facility LC issued by it complied
with the terms of such Facility LC or (ii) such LC Issuer's failure to pay
under any Facility LC issued by it after the presentation to it of a
request strictly complying with the terms and conditions of such Facility
LC. Subject to the terms and conditions of this Agreement (including,
without limitation, the submission of a Borrowing Notice in compliance
with Section 2.7 and the satisfaction of the applicable conditions
precedent set forth in Article IV), the Borrower may request an Advance
hereunder for the purpose of satisfying any Reimbursement Obligation.
Prior to the occurrence of a Conversion Event, the Borrower may also
request that a portion of the Aggregate Credit Linked Deposit be remitted
to the applicable LC Issuer in satisfaction of any amount drawn under a
Facility LC. So long as no Conversion Event is continuing, the Agent shall
honor such a request. The Borrower, within one Business Day of the date on
which Credit Linked Deposits are used to satisfy such drawn amount, shall
remit to the Agent for deposit into the Pre-Funded Letter of Credit
Account the Pre-Funded Account Reimbursement Amount owing in respect of
such drawn Facility LC amount. A Conversion Event shall occur if the
Borrower does not remit such Pre-Funded Account Reimbursement Amount to
the Agent within such one Business Day period. Upon the LC Issuer's
receipt of any such portion of the Aggregate Credit Linked Deposit in
payment of such drawn Facility LC amount, such LC Issuer shall be deemed
to automatically transfer to the Pre-Funded Lenders the Reimbursement
Obligations that arose as a result of such draw and the Pre-Funded Lenders
shall directly hold such Reimbursement Obligations until such time as the
corresponding Pre-Funded Account Reimbursement Amount is deposited into
the Pre-Funded Letter of Credit Account. If the Borrower does not
reimburse the applicable LC Issuer in accordance with the foregoing, the
Lenders shall be required to reimburse such LC Issuer on demand for such
Lender's (x) Facility LC Pro Rata Share prior to the occurrence of a
Conversion Event and (y) Pro Rata Share during the continuance of a
Conversion Event, of the amount of each payment made by such LC Issuer
under the applicable Facility LC in accordance with Section 2.19.5. All
such amounts paid by such LC Issuer and remaining unpaid by the Borrower,
shall bear interest payable on demand, for each day until paid at a rate
per annum equal to (x) the rate applicable to Floating Rate Advances for
such day if such day falls on or before the applicable LC Payment Date and
(y) the sum of 2% plus the rate
49
applicable to Floating Rate Advances for such day if such day falls after
such LC Payment Date. The Agent and each LC Issuer will pay to each Lender
ratably in accordance with its Facility LC Pro Rata Share or Pro Rata
Share, as applicable, all amounts received by it from the Borrower for
application in payment, in whole or in part, of the Reimbursement
Obligation in respect of any Facility LC issued by it, but only to the
extent such Lender has made payment to such LC Issuer in respect of such
Facility LC pursuant to Section 2.19.5. Any payment made to the Pre-Funded
Lenders shall be remitted directly to the Pre-Funded Letter of Credit
Account.
2.19.7 Obligations Absolute. The Borrower's obligations under this
Section 2.19 shall be absolute and unconditional under any and all
circumstances and irrespective of any setoff, counterclaim or defense to
payment which the Borrower may have or have had against any LC Issuer, any
Lender or any beneficiary of a Facility LC. The Borrower further agrees
with each LC Issuer and the Lenders that the LC Issuers and the Lenders
shall not be responsible for, and the Borrower's Reimbursement Obligation
in respect of any Facility LC shall not be affected by, among other
things, the validity or genuineness of documents or of any endorsements
thereon, even if such documents should in fact prove to be in any or all
respects invalid, fraudulent or forged, or any dispute between or among
the Borrower, any of its Affiliates, the beneficiary of any Facility LC or
any financing institution or other party to whom any Facility LC may be
transferred or any claims or defenses whatsoever of the Borrower or of any
of its Affiliates against the beneficiary of any Facility LC or any such
transferee. No LC Issuer shall be liable for any error, omission,
interruption or delay in transmission, dispatch or delivery of any message
or advice, however transmitted, in connection with any Facility LC. The
Borrower agrees that any action taken or omitted by any LC Issuer or any
Lender under or in connection with each Facility LC and the related drafts
and documents, if done without gross negligence or willful misconduct,
shall be binding upon the Borrower and shall not put any LC Issuer or any
Lender under any liability to the Borrower. Nothing in this Section 2.19.7
is intended to limit the right of the Borrower to make a claim against the
applicable LC Issuer for damages as contemplated by the proviso to the
first sentence of Section 2.19.6.
2.19.8 Actions of LC Issuers. Each LC Issuer shall be entitled to
rely, and shall be fully protected in relying, upon any Facility LC issued
by it, draft, writing, resolution, notice, consent, certificate,
affidavit, letter, cablegram, telegram, telecopy, telex or teletype
message, statement, order or other document believed by it to be genuine
and correct and to have been signed, sent or made by the proper Person or
Persons, and upon advice and statements of legal counsel, independent
accountants and other experts selected by such LC Issuer. Each LC Issuer
shall be fully justified in failing or refusing to take any action under
this Agreement unless it shall first have received such advice or
concurrence of the Required Lenders as it reasonably deems appropriate or
it shall first be indemnified to its reasonable satisfaction by the
Lenders against any and all liability and expense which may be incurred by
it by reason of taking or continuing to take any such action.
Notwithstanding any other provision of this Section 2.19, each LC Issuer
shall in all cases be fully protected in acting, or in refraining from
acting, under this Agreement in accordance with a request of the Required
Lenders, and such request and any action
50
taken or failure to act pursuant thereto shall be binding upon the Lenders
and any future holders of a participation in any Facility LC.
2.19.9 Indemnification. The Borrower hereby agrees to indemnify and
hold harmless each Lender required to participate in Facility LCs under
Section 2.19.2, each LC Issuer and the Agent, and their respective
directors, officers, agents and employees from and against any and all
claims and damages, losses, liabilities, costs or expenses which such
Lender, such LC Issuer or the Agent may incur (or which may be claimed
against such Lender, such LC Issuer or the Agent by any Person whatsoever)
by reason of or in connection with the issuance, execution and delivery or
transfer of or payment or failure to pay under any Facility LC or any
actual or proposed use of any Facility LC, including, without limitation,
any claims, damages, losses, liabilities, costs or expenses which such LC
Issuer may incur by reason of or in connection with (i) the failure of any
other Lender to fulfill or comply with its obligations to such LC Issuer
hereunder (but nothing herein contained shall affect any rights the
Borrower may have against any defaulting Lender) or (ii) by reason of or
on account of such LC Issuer issuing any Facility LC which specifies that
the term "Beneficiary" included therein includes any successor by
operation of law of the named Beneficiary, but which Facility LC does not
require that any drawing by any such successor Beneficiary be accompanied
by a copy of a legal document, satisfactory to the applicable LC Issuer,
evidencing the appointment of such successor Beneficiary; provided that
the Borrower shall not be required to indemnify any Lender, any LC Issuer
or the Agent for any claims, damages, losses, liabilities, costs or
expenses to the extent, but only to the extent, caused by (x) the willful
misconduct or gross negligence of such LC Issuer in determining whether a
request presented under any Facility LC complied with the terms of such
Facility LC or (y) such LC Issuer's failure to pay under any Facility LC
issued by it after the presentation to it of a request strictly complying
with the terms and conditions of such Facility LC. Nothing in this Section
2.19.9 is intended to limit the obligations of the Borrower under any
other provision of this Agreement.
2.19.10 Lenders' Indemnification. Each Lender shall, ratably in
accordance with its Facility LC Pro Rata Share or Pro Rata share, as and
when applicable, indemnify each LC Issuer, its affiliates and their
respective directors, officers, agents and employees (to the extent not
reimbursed by the Borrower) against any cost, expense (including
reasonable counsel fees and disbursements), claim, demand, action, loss or
liability (except such as result from such indemnitees' gross negligence
or willful misconduct or such LC Issuer's failure to pay under any
Facility LC issued by it after the presentation to it of a request
strictly complying with the terms and conditions of such Facility LC) that
such indemnitees may suffer or incur in connection with this Section 2.19
or any action taken or omitted by such indemnitees hereunder; provided,
however, that no Pre-Funded Lender's indemnity obligation hereunder shall
exceed the amount of its Credit Linked Deposit or its Pre-Funded Letter of
Credit Commitment.
2.19.11 Facility LC Collateral Account. Subsequent to the occurrence
and during the continuance of a Default, or at any time the Aggregate
Outstanding Credit Exposure exceeds the Borrowing Base, or at any time the
Aggregate Outstanding Credit Exposure exceeds the Aggregate Revolving Loan
Commitment plus the Aggregate Pre-Funded
51
Letter of Credit Commitment, the Borrower agrees that it will, upon the
request of the Agent or the Required Lenders and until the final
expiration date of any Facility LC and thereafter as long as any amount is
payable to any LC Issuer or the Lenders in respect of any Facility LC,
maintain a special collateral account pursuant to arrangements
satisfactory to the Agent (the "Facility LC Collateral Account") at the
Agent's office at the address specified pursuant to Article XIII, in the
name of the Borrower but under the sole dominion and control of the Agent,
for the benefit of the Lenders and in which the Borrower shall have no
interest other than as set forth in Section 8.1. The Borrower hereby
pledges, assigns and grants to the Agent, on behalf of and for the ratable
benefit of the Lenders and the LC Issuers, a security interest in all of
the Borrower's right, title and interest in and to all funds which may
from time to time be on deposit in the Facility LC Collateral Account to
secure the prompt and complete payment and performance of the Secured
Obligations. The Agent will invest any funds on deposit from time to time
in the Facility LC Collateral Account in certificates of deposit of Bank
One having a maturity not exceeding 30 days. Nothing in this Section
2.19.11 shall either obligate the Agent to require the Borrower to deposit
any funds in the Facility LC Collateral Account or limit the right of the
Agent to release any funds held in the Facility LC Collateral Account in
each case other than as required by Section 8.1.
2.19.12 Rights as a Lender. In its capacity as a Lender, each LC
Issuer shall have the same rights and obligations as any other Lender.
2.19.13 Conversion Event. Upon the occurrence and during the
continuance of a Conversion Event, if any Revolving Loans or Facility LCs
are outstanding at such time, the Pre-Funded Lenders shall purchase from
the Lenders with Revolving Loan Commitments a portion of the Aggregate
Outstanding Revolving Loan Credit Exposure held by such Lenders. Such
purchase shall be funded with all or a portion, as applicable, of the
Credit Linked Deposits. No such purchase shall include the unfunded
portion of any Lender's Revolving Loan Commitment and no such purchase
shall require a Pre-Funded Lender to fund its purchase beyond the amount
of its Pre-Funded Letter of Credit Commitment or its Credit Linked
Deposit. Subsequent to such purchase, each Pre-Funded Lender and each
other Lender shall hold a portion of the Aggregate Outstanding Credit
Exposure in an amount equal to its Pro Rata Share thereof. Such purchase
shall occur automatically upon the occurrence of a Conversion Event and
shall not require any action by any Lender. The Agent shall consummate
such purchase by withdrawing such portion of the Credit Linked Deposits
then on deposit in the Pre-Funded Letter of Credit Account as are
necessary to fund such purchase and shall distribute such amounts to the
Lenders with Revolving Loan Commitments so that each such Lender receives
its Revolving Loan Pro Rata Share thereof. Contemporaneously with such
purchase by the Pre-Funded Lenders, the Lenders with Revolving Loan
Commitments shall purchase from the Pre-Funded Lenders a portion of those
LC Obligations in which the Pre-Funded Lenders were solely participating
pursuant to Section 2.19.6. Pre-Funded Lenders shall divide the proceeds
of such purchase based on their Pre-Funded Letter of Credit Pro Rata
Shares thereof. If such Conversion Event is cured or waived, the Lenders
with Revolving Loan Commitments shall re-purchase from the Pre-Funded
Lenders those Loans and LC Obligations sold to the Pre-Funded Lenders upon
the occurrence of such Conversion Event, and the Pre-Funded Lenders shall
re-purchase from the other Lenders those LC
52
Obligations sold to such other Lenders upon the occurrence of such
Conversion Event; provided, that all such re-purchases shall give effect
to any reductions of the balance of such Loans and LC Obligations during
the period they were held by the Pre-Funded Lenders and the other Lenders,
as applicable. Such re-purchases are intended to result in the Lenders
holding only those Obligations they would have held had no Conversion
Event occurred. Repurchase proceeds owing to the Pre-Funded Lenders shall
be returned to the Pre-Funded Letter of Credit Account and shall once
again constitute Credit Linked Deposits. The purchases and re-purchases
described above may be net against one another and the Lenders may satisfy
their obligations hereunder by remitting the net purchase amounts to one
another, as applicable. All purchases and re-purchases described herein
shall be made without recourse or warranty. The purchases to occur after a
Conversion Event shall result in all Lenders holding their respective Pro
Rata Shares of the Aggregate Outstanding Credit Exposure so long as such
Conversion Event remains outstanding.
2.20. Increase of Aggregate Revolving Loan Commitment. The Borrower may
from time to time request that the Aggregate Revolving Loan Commitment be
increased to an amount which does not exceed $650,000,000 minus the aggregate
amount of all permitted partial reductions of the Aggregate Revolving Loan
Commitment under Section 2.4.3; provided, however, that (x) if such request
would cause the Aggregate Revolving Loan Commitment to exceed $550,000,000, no
such request shall be made by the Borrower until (1) the Borrower certifies in
writing to the Agent that its "Fixed Charge Coverage Ratio" under the indenture
referenced in clause (i) of Section 9.18 is equal to or greater than 2.0 to 1.0
and the incurrence of such additional Indebtedness is otherwise permitted under
such indenture or (2) the indenture referenced in clause (i) of Section 9.18 has
been amended, to the Agent's satisfaction, to permit a senior secured revolving
credit facility in excess of $550,000,000 plus the amount of the requested
increase; provided, however, that no action shall be required under clause (1)
or clause (2) subsequent to the termination of such indenture and the repayment
of all amounts outstanding in connection therewith, (y) each requested increase
shall be in an amount equal to $10,000,000 or an incremental amount in excess
thereof, and (z) an increase in the Aggregate Revolving Loan Commitment
hereunder may only be made at a time when no Unmatured Default or Default shall
have occurred and be continuing or would result therefrom. The Agent may request
an opinion of counsel from the Borrower in connection with any such increase. In
the event of such a requested increase in the Aggregate Revolving Loan
Commitment under this clause (ii), each of the Lenders shall be given the
opportunity to participate in the increased Aggregate Revolving Loan Commitment,
(x) initially ratably in the proportion that its Revolving Loan Commitment bears
to the Aggregate Revolving Loan Commitment and (y) to the extent that the
requested increase in the Aggregate Revolving Loan Commitment is not fulfilled
pursuant to the preceding clause, in such additional amounts as any Lender,
including any new Lender, the Agent and the Borrower agree. No Lender shall have
any obligation to increase its Revolving Loan Commitment pursuant to a request
by the Borrower under this clause (ii). No increase hereunder shall be effective
without the prior written consent of the Agent (no such consent to be
unreasonably withheld), including, without limitation, the Agent's prior written
consent to the documentation evidencing such increase.
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ARTICLE III
YIELD PROTECTION; TAXES
3.1. Yield Protection. If, on or after the Closing Date, the adoption of
any law or any governmental or quasi-governmental rule, regulation, policy,
guideline or directive (whether or not having the force of law), or any change
in any such law, rule, regulation, policy, guideline or directive or in the
interpretation or administration thereof by any governmental or
quasi-governmental authority, central bank or comparable agency charged with the
interpretation or administration thereof, or compliance by any Lender or
applicable Lending Installation or any LC Issuer with any request or directive
(whether or not having the force of law) of any such authority, central bank or
comparable agency:
(i) subjects any Lender or any applicable Lending Installation or any LC
Issuer to any Taxes, or changes the basis of taxation of payments
(other than with respect to Excluded Taxes) to any Lender or any LC
Issuer in respect of its Eurodollar Loans, Facility LCs, or
participations therein, or
(ii) imposes or increases or deems applicable any reserve, assessment,
insurance charge, special deposit or similar requirement against
assets of, deposits with or for the account of, or credit extended
by, any Lender or any applicable Lending Installation or any LC
Issuer (other than reserves and assessments taken into account in
determining the interest rate applicable to Eurodollar Advances), or
(iii) imposes any other condition the result of which is to increase the
cost to any Lender or any applicable Lending Installation of making,
funding or maintaining its Revolving Loan Commitment or Eurodollar
Loans or of issuing or participating in Facility LCs, or reduces any
amount receivable by any Lender or any applicable Lending
Installation or any LC Issuer in connection with its Revolving Loan
Commitment or Eurodollar Loans or Facility LCs (including
participations therein), or requires any Lender or any applicable
Lending Installation or any LC Issuer to make any payment calculated
by reference to the amount of Revolving Loan Commitment or
Eurodollar Loans or Facility LCs (including participations therein)
held or interest or LC Fees or Pre-Funded Letter of Credit Fees
received by it, by an amount deemed material by such Lender or any
LC Issuer, as applicable,
and the result of any of the foregoing is to increase the cost to such Lender or
applicable Lending Installation or such LC Issuer of making or maintaining its
Eurodollar Loans or Revolving Loan Commitment or of issuing or participating in
Facility LCs, as applicable, or to reduce the return received by such Lender or
applicable Lending Installation or such LC Issuer in connection with such
Eurodollar Loans or Revolving Loan Commitment, or Facility LCs (including
participations therein), then, within 15 days of demand, accompanied by the
written statement required by Section 3.6, by such Lender or LC Issuer, the
Borrower shall pay such Lender or LC Issuer such additional amount or amounts as
will compensate such Lender or LC Issuer for such increased cost or reduction in
amount received.
54
3.2. Changes in Capital Adequacy Regulations. If a Lender or LC Issuer
determines the amount of capital required or expected to be maintained by such
Lender or LC Issuer, any Lending Installation of such Lender or LC Issuer, or
any corporation controlling such Lender or LC Issuer is increased as a result of
a Change, then, within 15 days of demand, accompanied by the written statement
required by Section 3.6, by such Lender or LC Issuer, the Borrower shall pay
such Lender or LC Issuer the amount necessary to compensate for any shortfall in
the rate of return on the portion of such increased capital which such Lender or
LC Issuer determines is attributable to this Agreement, its Outstanding Credit
Exposure or its Revolving Loan Commitment to make Revolving Loans and issue or
participate in Facility LCs, as applicable, hereunder (after taking into account
such Lender's or LC Issuer's policies as to capital adequacy). "Change" means
(i) any change after the Closing Date in the Risk-Based Capital Guidelines or
(ii) any adoption of, or change in, or change in the interpretation or
administration of any other law, governmental or quasi-governmental rule,
regulation, policy, guideline, interpretation, or directive (whether or not
having the force of law) after the Closing Date which affects the amount of
capital required or expected to be maintained by any Lender or LC Issuer or any
Lending Installation or any corporation controlling any Lender or LC Issuer.
"Risk-Based Capital Guidelines" means (i) the risk-based capital guidelines in
effect in the United States on the Closing Date, including transition rules, and
(ii) the corresponding capital regulations promulgated by regulatory authorities
outside the United States implementing the July 1988 report of the Basle
Committee on Banking Regulation and Supervisory Practices Entitled
"International Convergence of Capital Measurements and Capital Standards,"
including transition rules, and any amendments to such regulations adopted prior
to the Closing Date.
3.3. Availability of Types of Advances. If (x) any Lender determines that
maintenance of its Eurodollar Loans at a suitable Lending Installation would
violate any applicable law, rule, regulation, or directive, whether or not
having the force of law, or (y) the Required Lenders determine that (i) deposits
of a type and maturity appropriate to match fund Eurodollar Advances are not
available or (ii) the interest rate applicable to Eurodollar Advances does not
accurately reflect the cost of making or maintaining Eurodollar Advances, or
(iii) no reasonable basis exists for determining the Eurodollar Base Rate, then
the Agent shall suspend the availability of Eurodollar Advances and require any
affected Eurodollar Advances to be repaid or converted to Floating Rate Advances
on the respective last days of the then current Interest Periods with respect to
such Loans or within such earlier period as required by law, subject to the
payment of any funding indemnification amounts required by Section 3.4.
3.4. Funding Indemnification. If any payment of a Eurodollar Advance
occurs on a date which is not the last day of the applicable Interest Period,
whether because of acceleration, prepayment or otherwise, or a Eurodollar
Advance is not made or continued, or a Floating Rate Advance is not converted
into a Eurodollar Advance, on the date specified by the Borrower for any reason
other than default by the Lenders, or a Eurodollar Advance is not prepaid on the
date specified by the Borrower for any reason, the Borrower will indemnify each
Lender for any loss or cost incurred by it resulting therefrom, including,
without limitation, any loss or cost in liquidating or employing deposits
acquired to fund or maintain such Eurodollar Advance.
3.5. Taxes. (i) All payments by the Borrower to or for the account of any
Lender, any LC Issuer, or the Agent hereunder or under any Note shall be made
free and clear of and without deduction for any and all Taxes. If the Borrower
shall be required by law to deduct any Taxes
55
from or in respect of any sum payable hereunder to any Lender, any LC Issuer, or
the Agent, (a) the sum payable shall be increased as necessary so that after
making all required deductions (including deductions applicable to additional
sums payable under this Section 3.5) such Lender, LC Issuer, or the Agent (as
the case may be) receives an amount equal to the sum it would have received had
no such deductions been made, (b) the Borrower shall make such deductions, (c)
the Borrower shall pay the full amount deducted to the relevant authority in
accordance with applicable law and (d) the Borrower shall furnish to the Agent
the original copy of a receipt evidencing payment thereof or, if a receipt
cannot be obtained with reasonable efforts, such other evidence of payment as is
reasonably acceptable to the Agent, in each case within 30 days after such
payment is made.
(ii) In addition, the Borrower shall pay any present or future stamp or
documentary taxes and any other excise or property taxes, charges or
similar levies which arise from any payment made hereunder or under
any Note or Facility LC Application or from the execution or
delivery of, or otherwise with respect to, this Agreement, any Note
or any Facility LC Application ("Other Taxes").
(iii) The Borrower shall indemnify the Agent, each LC Issuer, and each
Lender for the full amount of Taxes or Other Taxes (including,
without limitation, any Taxes or Other Taxes imposed on amounts
payable under this Section 3.5) paid by the Agent, such LC Issuer,
or such Lender as a result of its Revolving Loan Commitment, any
Credit Extensions made by it hereunder, or any Facility LC issued or
participated in by it hereunder, or otherwise in connection with its
participation in this Agreement and any liability (including
penalties, interest and expenses) arising therefrom or with respect
thereto. Payments due under this indemnification shall be made
within 30 days of the date the Agent or such LC Issuer or such
Lender makes demand therefor pursuant to Section 3.6.
(iv) Each Lender that is not incorporated under the laws of the United
States of America or a state thereof (each a "Non-U.S. Lender")
agrees that it will, not more than ten Business Days after the date
on which it becomes a party to this Agreement (but in any event
before a payment is due to it hereunder), (i) deliver to each of the
Borrower and the Agent two duly completed copies of United States
Internal Revenue Service Form W-8BEN or W-8ECI, certifying in either
case that such Lender is entitled to receive payments under this
Agreement without deduction or withholding of any United States
federal income taxes, or (ii) in the case of a Non-U.S. Lender that
is fiscally transparent, deliver to the Agent a United States
Internal Revenue Form W-8IMY together with the applicable
accompanying forms, W-8 or W-9, as the case may be, and certify that
it is entitled to an exemption from United States withholding tax.
Each Non-U.S. Lender further undertakes to deliver to the Borrower
and the Agent (x) renewals or additional copies of such form (or any
successor form) on or before the date that such form expires or
becomes obsolete, and (y) after the occurrence of any event
requiring a change in the most recent forms so delivered by it, such
additional forms or amendments thereto as may be reasonably
requested by the Borrower or the Agent. All forms or amendments
described in the preceding sentence shall certify that such Lender
is entitled to receive payments under this
56
Agreement without deduction or withholding of any United States
federal income taxes, unless an event (including without limitation
any change in treaty, law or regulation) has occurred prior to the
date on which any such delivery would otherwise be required which
renders all such forms inapplicable or which would prevent such
Lender from duly completing and delivering any such form or
amendment with respect to it and such Lender advises the Borrower
and the Agent that it is not capable of receiving payments without
any deduction or withholding of United States federal income tax.
(v) For any period during which a Non-U.S. Lender has failed to provide
the Borrower with an appropriate form pursuant to clause (iv) above
(unless such failure is due to a change in treaty, law or
regulation, or any change in the interpretation or administration
thereof by any governmental authority, occurring subsequent to the
date on which a form originally was required to be provided), such
Non-U.S. Lender shall not be entitled to indemnification under this
Section 3.5 with respect to Taxes imposed by the United States;
provided that, should a Non-U.S. Lender which is otherwise exempt
from or subject to a reduced rate of withholding tax become subject
to Taxes because of its failure to deliver a form required under
clause (iv) above, the Borrower shall take such steps as such
Non-U.S. Lender shall reasonably request to assist such Non-U.S.
Lender to recover such Taxes.
(vi) Any Lender that is entitled to an exemption from or reduction of
withholding tax with respect to payments under this Agreement or any
Note pursuant to the law of any relevant jurisdiction or any treaty
shall deliver to the Borrower (with a copy to the Agent), at the
time or times prescribed by applicable law, such properly completed
and executed documentation prescribed by applicable law as will
permit such payments to be made without withholding or at a reduced
rate.
(vii) If the U.S. Internal Revenue Service or any other governmental
authority of the United States or any other country or any political
subdivision thereof asserts a claim that the Agent did not properly
withhold tax from amounts paid to or for the account of any Lender
(because the appropriate form was not delivered or properly
completed, because such Lender failed to notify the Agent of a
change in circumstances which rendered its exemption from
withholding ineffective, or for any other reason), such Lender shall
indemnify the Agent fully for all amounts paid, directly or
indirectly, by the Agent as tax, withholding therefor, or otherwise,
including penalties and interest, and including taxes imposed by any
jurisdiction on amounts payable to the Agent under this subsection,
together with all costs and expenses related thereto (including
attorneys fees and time charges of attorneys for the Agent, which
attorneys may be employees of the Agent). The obligations of the
Lenders under this Section 3.5(vii) shall survive the payment of the
Obligations and termination of this Agreement.
3.6. Lender Statements; Survival of Indemnity. Each Lender shall deliver
a written statement of such Lender to the Borrower (with a copy to the Agent) as
to the amount due, if any, under Section 3.1, 3.2, 3.4 or 3.5. Such written
statement shall set forth in reasonable detail
57
the calculations upon which such Lender determined such amount and shall be
final, conclusive and binding on the Borrower in the absence of manifest error.
Determination of amounts payable under such Sections in connection with a
Eurodollar Loan shall be calculated as though each Lender funded its Eurodollar
Loan through the purchase of a deposit of the type, currency and maturity
corresponding to the deposit used as a reference in determining the Eurodollar
Rate applicable to such Loan, whether in fact that is the case or not. Unless
otherwise provided herein, the amount specified in the written statement of any
Lender shall be payable on demand after receipt by the Borrower of such written
statement. The obligations of the Borrower under Sections 3.1, 3.2, 3.4 and 3.5
shall survive payment of the Obligations and termination of this Agreement.
3.7. Alternative Lending Installation. To the extent reasonably possible,
each Lender shall designate an alternate Lending Installation with respect to
its Eurodollar Loans to reduce any liability of the Borrower to such Lender
under Sections 3.1, 3.2 and 3.5 or to avoid the unavailability of Eurodollar
Advances under Section 3.3, so long as such designation is not, in the judgment
of such Lender, reasonably disadvantageous to such Lender. A Lender's
designation of an alternative Lending Installation shall not affect the
Borrower's rights under Section 2.18 to replace a Lender.
ARTICLE IV
CONDITIONS PRECEDENT
4.1. Effectiveness of Revolving Loan Commitments and Pre-Funded Letter of
Credit Commitments. The Lenders' Revolving Loan Commitments and Pre-Funded
Letter of Credit Commitments shall not be effective hereunder until the Agent
shall have received on the Closing Date a fully executed copy of this Agreement.
The following conditions precedent were satisfied by the Borrower and copies of
the following deliveries were received by the Agent in connection with the Prior
Credit Agreement:
4.1.1 Copies of the articles or certificate of incorporation (or the
equivalent thereof) of (a) the Borrower and (b) each Subsidiary Guarantor,
in each case together with all amendments thereto, and a certificate of
good standing, each certified by the appropriate governmental officer in
its jurisdiction of organization.
4.1.2 Copies, certified by the Secretary or Assistant Secretary (or
the equivalent thereof) of (a) the Borrower and (b) each Subsidiary
Guarantor, in each case, of its by-laws and of its Board of Directors'
resolutions and of resolutions or actions of any other body authorizing
the execution of the Loan Documents to which the Borrower or such
Subsidiary, as applicable, is a party.
4.1.3 An incumbency certificate, executed by the Secretary or
Assistant Secretary (or the equivalent thereof) of (a) the Borrower and
(b) each Subsidiary Guarantor, in each case which shall identify by name
and title and bear the signatures of the Authorized Officers and any other
officers of the Borrower and such Subsidiary authorized to sign the Loan
Documents to which the Borrower and such Subsidiary are parties, upon
which
58
certificate the Agent and the Lenders shall be entitled to rely until
informed of any change in writing by the Borrower or such Subsidiary, as
applicable.
4.1.4 A certificate, in substantially the form of Exhibit G, signed
by the chief financial officer of the Borrower, stating that on the
initial Credit Extension Date (a) no Default or Unmatured Default has
occurred and is then continuing, (b) all of the representations and
warranties in Article V shall be true and correct in all material respects
as of such date (or an earlier date if a representation or warranty
relates to a specified earlier date) and (c) no material adverse change in
the business, Property, condition (financial or otherwise), operations or
results of operations or prospects of the Borrower or any of its
Subsidiary Guarantors has occurred since December 31, 2002.
4.1.5 A written opinion of the Borrower's counsel, in form and
substance satisfactory to the Agent and addressed to the Lenders, in
substantially the form of Exhibit A hereto.
4.1.6 Any Notes requested by a Lender pursuant to Section 2.12
payable to the order of each such requesting Lender.
4.1.7 Written money transfer instructions, in substantially the form
of Exhibit D, addressed to the Agent and signed by an Authorized Officer,
together with such other related money transfer authorizations as the
Agent may have reasonably requested.
4.1.8 The Agent shall have determined that the Borrower has fully
cooperated with the Agent's syndication efforts, including, without
limitation, by providing the Agent with information regarding the
Borrower's operations and prospects and such other information as the
Agent deems necessary to successfully syndicate the Loans hereunder.
4.1.9 [Intentionally Omitted]
4.1.10 A fully-executed copy of each of this Agreement, the Security
Agreement, the Senior Note Indenture, and the Senior Term Loan Agreement.
4.1.11 Evidence satisfactory to the Agent that the Borrower has
received Net Cash Proceeds resulting from the issuance of Other Senior
Secured Debt in an aggregate amount equal to or greater than $550,000,000.
4.1.12 A Monthly Collateral Report for February 2003, an Interim
Collateral Report dated as of April 17, 2003, and such other evidence
reasonably requested by the Agent to demonstrate that, among other things,
the excess of the Borrowing Base as set forth in the above-mentioned
Interim Collateral Report over the Aggregate Outstanding Credit Exposure
on the Closing Date, after giving effect to all Advances requested by the
Borrower and to be made on the Closing Date, equals or exceeds
$175,000,000.
4.1.13 An initial compliance certificate dated as of April 17, 2003,
in substantially the form of Exhibit B hereto, together with (i) the
Borrower's most recently completed audited financial statements for the
fiscal year ended December 31, 2002 as
59
filed on Form 10-K with the U.S. Securities and Exchange Commission, (ii)
the Borrower's most recently completed financial summaries, and (iii) the
Borrower's financial projections, in a format reasonably acceptable to the
Agent, for the period beginning January 1, 2003 and ending December 31,
2006.
4.1.14 All fees owing to the Agent and the Lenders on the Closing
Date, including, without limitation, those referenced in Section 10.13,
shall have been fully paid.
4.1.15 Those deliveries required in connection with the
Intercreditor Agreement.
4.1.16 Such other documents as any Lender or its counsel may have
reasonably requested, including, without limitation, those documents set
forth in Exhibit H hereto.
4.2. Each Credit Extension. The Lenders shall not be required to make any
Credit Extension (except as otherwise set forth in Section 2.1.3(d) with respect
to Revolving Loans extended for purposes of repaying Non-Ratable Loans and other
than in connection with Collateral Protection Advances) unless on the applicable
Credit Extension Date:
4.2.1 There exists no Default or Unmatured Default.
4.2.2 The representations and warranties contained in Article V are
true and correct as of such Credit Extension Date except (x) with respect
to Sections 5.5 and 5.7, the representations and warranties set forth in
such Sections shall have been true and correct on and as of the date of
the most recent Form 10-K or Form 10-Q filing, as applicable, made by the
Borrower with the U.S. Securities and Exchange Commission, and (y) with
respect to any other representation and warranty set forth in Article V,
to the extent such representation or warranty is stated to relate solely
to an earlier date, such representation or warranty shall have been true
and correct on and as of such earlier date.
Each Borrowing Notice, or request for issuance of a Facility LC, or
request for issuance of a Pre-Funded Facility LC, with respect to each such
Credit Extension shall constitute a representation and warranty by the Borrower
that the conditions contained in Sections 4.2.1 and 4.2.2 have been satisfied.
ARTICLE V
REPRESENTATIONS AND WARRANTIES
The Borrower represents and warrants to each Lender and the Agent as of
each of (i) the Closing Date, (ii) the date of the initial Credit Extension
hereunder (if different from the Closing Date) and (iii) each date as required
by Section 4.2:
5.1. Existence and Standing. Each of the Borrower and its Subsidiaries is
a corporation, partnership (in the case of Subsidiaries only) or limited
liability company duly incorporated or organized, as the case may be, validly
existing and (to the extent such concept applies to such entity) in good
standing under the laws of its jurisdiction of incorporation or organization and
has all requisite authority to conduct its business in each jurisdiction in
which
60
its business is conducted, except where the failure to be so qualified does not
or could not be expected to cause or result in the occurrence of a Material
Adverse Effect.
5.2. Authorization and Validity. Each of the Borrower and each Subsidiary
Guarantor has the power and authority and legal right to execute and deliver the
Loan Documents to which the Borrower or each such Subsidiary Guarantor, as
applicable, is a party and to perform its obligations thereunder. The execution
and delivery by each of the Borrower and each Subsidiary Guarantor of the Loan
Documents to which the Borrower or each such Subsidiary Guarantor, as
applicable, is a party and the performance of its obligations thereunder have
been duly authorized by proper proceedings, and the Loan Documents to which the
Borrower or such Subsidiary Guarantor, as applicable, is a party constitute
legal, valid and binding obligations of the Borrower or such Subsidiary
Guarantor, as applicable, enforceable against the Borrower or such Subsidiary
Guarantor, as applicable, in accordance with their terms, except as
enforceability may be limited by (i) bankruptcy, insolvency, fraudulent
conveyances, reorganization or similar laws relating to or affecting the
enforcement of creditors' rights generally; (ii) general equitable principles
(whether considered in a proceeding in equity or at law); and (iii) requirements
of reasonableness, good faith and fair dealing.
5.3. No Conflict; Government Consent. Neither the execution and delivery
by the Borrower or the Subsidiary Guarantors, as applicable, of the Loan
Documents, nor the consummation of the transactions therein contemplated, nor
compliance with the provisions thereof will violate (i) any law, rule,
regulation, order, writ, judgment, injunction, decree or award binding on the
Borrower or any of the Subsidiary Guarantors, or (ii) the Borrower's or any
Subsidiary Guarantor's articles or certificate of incorporation, partnership
agreement, certificate of partnership, articles or certificate of organization,
by-laws, or operating agreement or other management agreement, as the case may
be, or (iii) the provisions of any indenture, instrument or agreement to which
the Borrower or any of the Subsidiary Guarantors is a party or is subject, or by
which it, or its Property, is bound, or conflict with, or constitute a default
under, or result in, or require, the creation or imposition of any Lien in, of
or on the Property of the Borrower or a Subsidiary Guarantor pursuant to the
terms of, any such indenture, instrument or agreement. No order, consent,
adjudication, approval, license, authorization, or validation of, or exemption
by, any governmental or public body or authority, or any subdivision thereof,
which has not been obtained by the Borrower or any of the Subsidiary Guarantors,
is required to be obtained by the Borrower or any of the Subsidiary Guarantors
in connection with the execution and delivery of the Loan Documents, the
borrowings under this Agreement, the payment and performance by the Borrower of
the Obligations or the legality, validity, binding effect or enforceability of
any of the Loan Documents.
5.4. Financial Statements. The December 31, 2003 consolidated financial
statements of the Borrower and its Subsidiaries heretofore delivered to the
Agent and the Lenders were prepared in accordance with US GAAP in effect on the
date such statements were prepared and fairly present the consolidated financial
condition of the Borrower and its Subsidiaries at such date.
5.5. Material Adverse Change. Since December 31, 2003, there has been no
change in the business, Property, prospects, condition (financial or otherwise)
or results of operations of the
61
Borrower and its Subsidiaries, taken together, which could reasonably be
expected to have a Material Adverse Effect.
5.6. Taxes. The Borrower and its Subsidiaries have filed all United
States federal tax returns and all other tax returns which are required to be
filed and have paid all taxes due pursuant to said returns or pursuant to any
assessment received by the Borrower or any of its Subsidiaries, except in
respect of such taxes, if any, as are being contested in good faith and as to
which adequate reserves have been provided in accordance with Agreement
Accounting Principles and as to which no Lien exists (except as permitted by
Section 6.15.1). The United States income tax returns of the Borrower and its
Subsidiaries have been audited by the Internal Revenue Service through the
fiscal year ended 1998. No liens have been filed with respect to such taxes. The
charges, accruals and reserves on the books of the Borrower and its Subsidiaries
in respect of any taxes or other governmental charges are adequate.
5.7. Litigation and Contingent Obligations. There is no litigation,
arbitration, governmental investigation, proceeding or inquiry pending or, to
the knowledge of any of their officers, threatened against or affecting the
Borrower or any of its Subsidiaries which could reasonably be expected to have a
Material Adverse Effect or which seeks to prevent, enjoin or delay the making of
any Loans. Other than any liability incident to any litigation, arbitration or
proceeding which could not reasonably be expected to have a Material Adverse
Effect, the Borrower has no material contingent obligations not provided for or
disclosed in the financial statements referred to in Section 5.4.
5.8. Subsidiaries. Schedule 5.8 contains an accurate list of all
Subsidiaries of the Borrower as of the date of this Agreement, setting forth
their respective jurisdictions of organization and the percentage of their
respective capital stock or other ownership interests owned by the Borrower or
other Subsidiaries. Schedule 5.8 also identifies those Subsidiaries that
constitute Subsidiary Guarantors. All of the issued and outstanding shares of
capital stock or other ownership interests of such Subsidiaries have been (to
the extent such concepts are relevant with respect to such ownership interests)
duly authorized and issued and are fully paid and non-assessable.
5.9. ERISA. As of the Closing Date, the Unfunded Liabilities of all
Single Employer Plans do not in the aggregate exceed $75,000,000. As of the
Closing Date, each Plan complies with all minimum funding requirements under
ERISA. As of the Closing Date, neither the Borrower nor any member of the
Controlled Group is party to a Multiemployer Plan or has, or could reasonably be
expected to have, any liability to a Multiemployer Plan.
5.10. Accuracy of Information. The information, exhibits or reports
furnished by the Borrower to the U.S. Securities and Exchange Commission on Form
10-K and Form 10-Q do not contain any material misstatement of fact or omit to
state a material fact or any fact necessary to make the statements contained
therein not misleading. The information furnished by the Borrower in each
Monthly Collateral Report and Interim Collateral Report is, to the best of the
Borrower's knowledge, accurate in all material respects.
5.11. Regulation U. Neither the Borrower nor any of its Subsidiaries is
engaged principally, or as one of its important activities, in the business of
extending credit for the
62
purpose, whether immediate, incidental or ultimate of buying or carrying margin
stock (as defined in Regulation U), and after applying the proceeds of each
Credit Extension, margin stock (as defined in Regulation U) constitutes less
than 25% of the value of those assets of the Borrower and its Subsidiaries which
are subject to any limitation on sale, pledge, or any other restriction
hereunder.
5.12. Material Agreements. Neither the Borrower nor any Subsidiary is in
default in the performance, observance or fulfillment of any of the obligations,
covenants or conditions contained in (i) any agreement or instrument to which it
is a party, which default could reasonably be expected to have a Material
Adverse Effect or (ii) any agreement or instrument evidencing or governing
Indebtedness.
5.13. Compliance With Laws. The Borrower and its Subsidiaries have
complied with all applicable statutes, rules, regulations, orders and
restrictions of any domestic or foreign government or any instrumentality or
agency thereof having jurisdiction over the conduct of their respective
businesses or the ownership of their respective Property, except where the
failure to do so has not caused or resulted in the occurrence of a Material
Adverse Effect.
5.14. Ownership of Properties. On the date of this Agreement, the Borrower
and its Subsidiaries have indefeasible title, free of all Liens other than those
permitted by Section 6.15, to all of the assets reflected in the Borrower's most
recent consolidated financial statements provided to the Agent, as owned by the
Borrower and its Subsidiaries.
5.15. Plan Assets; Prohibited Transactions. The Borrower is not an entity
deemed to hold "plan assets" within the meaning of 29 C.F.R. Section 2510.3-101
of an employee benefit plan (as defined in Section 3(3) of ERISA) which is
subject to Title I of ERISA or any plan (within the meaning of Section 4975 of
the Code), and neither the execution of this Agreement nor the making of
Revolving Loans hereunder gives rise to a prohibited transaction within the
meaning of Section 406 of ERISA or Section 4975 of the Code.
5.16. Environmental Matters. In the ordinary course of its business, the
officers of the Borrower consider the effect of Environmental Laws on the
business of the Borrower and its Subsidiaries, in the course of which they
identify and evaluate potential risks and liabilities accruing to the Borrower
due to Environmental Laws. On the basis of this consideration, the Borrower has
concluded that Environmental Laws cannot reasonably be expected to have a
Material Adverse Effect. Neither the Borrower nor any Subsidiary has received
any notice to the effect that its operations are not in material compliance with
any of the requirements of applicable Environmental Laws or are the subject of
any federal or state investigation evaluating whether any remedial action is
needed to respond to a release of any toxic or hazardous waste or substance into
the environment, which non-compliance or remedial action could reasonably be
expected to have a Material Adverse Effect.
5.17. Investment Company Act. Neither the Borrower nor any Subsidiary is
an "investment company" or a company "controlled" by an "investment company",
within the meaning of the Investment Company Act of 1940, as amended.
63
5.18. Public Utility Holding Company Act. The Borrower is not a "holding
company" as such term is defined in the Public Utility Holding Company Act of
1935, as amended.
5.19. Insurance. The Borrower maintains, and has caused each Subsidiary to
maintain, with financially sound and reputable insurance companies, insurance on
all their Property in such amounts, subject to such deductibles and
self-insurance retentions and covering such properties and risks as is
consistent with sound business practice. The Borrower has delivered to the Agent
and the Lenders a complete and accurate list of its insurance policies and
programs and the Property subject thereto. The Borrower has caused all such
policies to be subject to provisions which prohibit the cancellation thereof by
the provider thereof without at least 30 days' prior written notice to the
Borrower and each loss payee thereof.
5.20. No Default or Unmatured Default. No Default or Unmatured Default has
occurred and is continuing.
ARTICLE VI
COVENANTS
During the term of this Agreement, unless the Required Lenders shall
otherwise consent in writing:
6.1. Financial Reporting. The Borrower will maintain, for itself and each
Subsidiary, a system of accounting established and administered in accordance
with US GAAP, and furnish to the Agent for the benefit of the Lenders:
6.1.1 Within 105 days after the close of each of its fiscal years,
(a) financial statements prepared in accordance with Agreement Accounting
Principles on a consolidated basis for itself and its Subsidiaries, as
filed on Form 10-K with the U.S. Securities and Exchange Commission,
accompanied by (i) an auditor's report, unqualified as to scope, of a
nationally recognized firm of independent public accountants or other
independent public accountants reasonably acceptable to the Required
Lenders; (ii) any management letter prepared by said accountants; and
(iii) a certificate of said accountants that, in the course of their
examination necessary for their certification of the foregoing, they have
obtained no knowledge of any Default or Unmatured Default, or if, in the
opinion of such accountants, any Default or Unmatured Default shall exist,
stating the nature and status thereof.
6.1.2 Within (x) 30 days after the end of each calendar month other
than those calendar months that end the first three fiscal quarters of
each of the Borrower's fiscal years, and (y) 45 days after the end of each
December of each calendar year, for itself and its Subsidiaries, the
Borrower's financial summaries for such month, which shall be in form and
substance substantially similar to the financial summaries delivered on or
prior to the Closing Date or shall otherwise be in form and substance
reasonably acceptable to the Agent.
6.1.3 Within 45 days after the close of each of the first three
fiscal quarters of each of its fiscal years, for itself and its
Subsidiaries, consolidated unaudited financial
64
statements for such period as filed on Form 10-Q with the U.S. Securities
and Exchange Commission, prepared in accordance with Agreement Accounting
Principles and (except for the exclusion of any disclosure permitted by
the U.S. Securities and Exchange Commission) certified as to fairness of
presentation and consistency by its chief financial officer or treasurer.
6.1.4 Together with the financial statements required under Sections
6.1.1 and 6.1.3, a compliance certificate in substantially the form of
Exhibit B signed by its chief financial officer or treasurer showing the
calculations necessary to determine compliance with this Agreement, an
officer's certificate in substantially the form of Exhibit G stating that
no Default or Unmatured Default exists, or if any Default or Unmatured
Default exists, stating the nature and status thereof, and, together with
the financial statements required under Section 6.1.1 and Section 6.1.3, a
certificate executed and delivered by the chief executive officer or chief
financial officer stating that the Borrower is in compliance with all
requirements of Section 302 and Section 906 of the ▇▇▇▇▇▇▇▇-▇▇▇▇▇ Act of
2002 and all rules and regulations related thereto.
6.1.5 Within 270 days after the close of each fiscal year of the
Borrower, a copy of the actuarial report and Form 5500 with Schedule B
showing the Unfunded Liabilities of each Single Employer Plan as of the
valuation date occurring in such fiscal year, certified by an actuary
enrolled under ERISA.
6.1.6 As soon as practicable and in any event within 10 days after
the Borrower knows that any Reportable Event has occurred with respect to
any Plan, a statement, signed by the chief financial officer or treasurer
of the Borrower, describing said Reportable Event and the action which the
Borrower proposes to take with respect thereto.
6.1.7 As soon as practicable and in any event within 10 days after
receipt by the Borrower, a copy of (a) any notice or claim to the effect
that the Borrower or any of its Subsidiaries is or may be liable to any
Person as a result of the release by the Borrower, any of its
Subsidiaries, or any other Person of any toxic or hazardous waste or
substance into the environment, and (b) any notice alleging any violation
of any federal, state or local environmental, health or safety law or
regulation by the Borrower or any of its Subsidiaries, which, in either
case, could reasonably be expected to have a Material Adverse Effect.
6.1.8 Promptly upon the filing thereof, copies of all registration
statements and annual, quarterly, or other regular reports which the
Borrower or any of its Subsidiaries files with the Securities and Exchange
Commission, including, without limitation, all certifications and other
filings required by Section 302 and Section 906 of the ▇▇▇▇▇▇▇▇-▇▇▇▇▇ Act
of 2002 and all rules and regulations related thereto.
6.1.9 On each date on which an Interim Collateral Report or a
Monthly Collateral Report is delivered, the Borrower shall provide the
Agent with all supporting documents the Agent reasonably deems desirable,
all certified as being true and correct by an Authorized Officer of the
Borrower. The Borrower may update Interim Collateral
65
Reports and Monthly Collateral Reports more frequently than the periods
set forth below and, so long as such Interim Collateral Reports or Monthly
Collateral Reports are delivered together with all supporting information
reasonably requested by the Agent, the most recently delivered Interim
Collateral Report or Monthly Collateral Report, as applicable, shall be
the applicable Interim Collateral Report or Monthly Collateral Report for
purposes of determining the Borrowing Base at any time.
6.1.10 As soon as practicable, and in any event within 15 calendar
days of the end of each calendar month, the Borrower shall provide the
Agent with a Monthly Collateral Report for such calendar month certified
as being true and correct in all material respects by an Authorized
Officer of the Borrower. In addition to the foregoing, the Borrower, upon
the Agent's reasonable request, shall deliver copies of invoices, purchase
orders, credit memoranda, shipping and delivery documents and other
information related to Eligible Receivables and Eligible Petroleum
Inventory identified in the applicable Monthly Collateral Report.
6.1.11 For so long as Excess Availability is:
(x) less than or equal to 25% of the Borrowing Base then in effect,
as soon as practicable, and in any event within three Business Days
after the end of each calendar week during such period; and
(y) greater than 25% but less than or equal to 35% of the Borrowing
Base then in effect, as soon as practicable, and in any event within
3 Business Days after the end of each of the second and fourth full
calendar weeks of any calendar month during such period;
the Borrower shall provide to the Agent an Interim Collateral Report
for the applicable one-week or two-week period certified as being
true and correct by an Authorized Officer of the Borrower. Each
Interim Collateral Report shall identify, for the applicable
reporting period, the aggregate amount of all contra-accounts
related to Specified Customers net of the aggregate of the face
amounts of all letters of credit issued on behalf of the Borrower or
the applicable Subsidiary Guarantor to Specified Customers as
payment for goods or services purchased by the Borrower or the
applicable Subsidiary Guarantor from the Specified Customers.
No Interim Collateral Report described in this Section 6.1.11 shall
be required to be delivered by the Borrower pursuant to this Section
6.1.11 during any period Excess Availability exceeds 35% of the
Borrowing Base then in effect.
6.1.12 If on any date Excess Availability exceeds 35% of the then
effective Borrowing Base, and the dollar value of the then existing
Eligible Petroleum Inventory is less than 80% of the dollar value of
Eligible Petroleum Inventory reported in the last
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Interim Collateral Report or Monthly Collateral Report delivered to the
Agent, as applicable, the Borrower shall provide to the Agent, within five
Business Days of such date, a new Interim Collateral Report certified as
being true and correct by an Authorized Officer of the Borrower, together
with all supporting documentation reasonably requested by the Agent. If on
any date Excess Availability is greater than 25% of the then effective
Borrowing Base but less than or equal to 35% of the then effective
Borrowing Base, and the dollar value of the then existing Eligible
Petroleum Inventory is less than 85% of the dollar value of Eligible
Petroleum Inventory reported in the last Interim Collateral Report or
Monthly Collateral Report delivered to the Agent, as applicable, the
Borrower shall provide to the Agent, within five Business Days of such
date, a new Interim Collateral Report certified as being true and correct
by an Authorized Officer of the Borrower, together with all supporting
documentation reasonably requested by the Agent.
6.1.13 Within 30 days after the close of each of its fiscal years, a
copy of the plan and forecast (including a projected balance sheet,
projected income statements, and projected funds flow statement) of the
Borrower and its Subsidiaries, for the upcoming fiscal year prepared in
such detail as shall be reasonably satisfactory to the Agent. Any plan and
forecast in form and substance substantially similar to the plan and
forecast delivered on or prior to the Closing Date shall be deemed to be
reasonably satisfactory by the Agent.
6.1.14 Such other information (including non-financial information
and additional or supplemental reporting) as the Agent or any Lender may
from time to time reasonably request.
6.2. Use of Proceeds. The Borrower will, and will cause each Subsidiary
to, use the proceeds of the Credit Extensions for general corporate purposes,
including, without limitation, for working capital, to repay certain
Indebtedness, expenditures constituting Consolidated Capital Expenditures,
Permitted Acquisitions, and to pay fees and expenses incurred in connection with
this Agreement. The Borrower shall use the proceeds of Credit Extensions in
compliance with all applicable legal and regulatory requirements and any such
use shall not result in a violation of any such requirements, including, without
limitation, Regulation U and X, the Securities Act of 1933, as amended, and the
Securities Exchange Act of 1934, as amended, and the regulations promulgated
thereunder.
6.3. Notice of Default. Within five (5) Business Days after an Authorized
Officer becomes aware thereof, the Borrower will, and will cause each Subsidiary
Guarantor to, give notice in writing to the Lenders of the occurrence of any
Default or Unmatured Default and of any other development, financial or
otherwise, which could reasonably be expected to have a Material Adverse Effect.
6.4. Conduct of Business. The Borrower will, and will cause each
Subsidiary Guarantor to, carry on and conduct its business in substantially the
same manner and in substantially the same fields of enterprise as it is
presently conducted and do all things necessary to remain duly incorporated or
organized, validly existing and (to the extent such concept applies to such
entity) in good standing as a corporation, partnership or limited liability
company in its jurisdiction of incorporation or organization, as the case may
be, and maintain all requisite
67
authority to conduct its business in each jurisdiction in which its business is
conducted, except where the failure to do so could not reasonably be expected to
cause or result in the occurrence of a Material Adverse Effect.
6.5. Taxes. The Borrower will, and will cause each Subsidiary to, timely
file complete and correct United States federal and applicable foreign, state
and local tax returns required by law and pay when due all taxes, assessments
and governmental charges and levies upon it or its income, profits or Property,
except those which are being contested in good faith by appropriate proceedings
and with respect to which adequate reserves have been set aside in accordance
with Agreement Accounting Principles.
6.6. Insurance. The Borrower will, and will cause each Subsidiary to,
maintain with financially sound and reputable insurance companies insurance on
all their Property in such amounts, subject to such deductibles and
self-insurance retentions, and covering such risks as is consistent with sound
business practice and as is reasonably satisfactory to the Agent. The Agent
confirms that the Borrower's and its Subsidiaries' insurance on the Closing Date
is reasonably satisfactory to the Agent. The Borrower will furnish to the Agent
(for distribution to any Lender) upon request full information as to the
insurance carried. The Borrower shall deliver to the Agent lender's loss payable
endorsements in form and substance acceptable to the Agent to all insurance
policies providing coverage for the Collateral. In the event the Borrower or any
of its Subsidiaries at any time or times hereafter shall fail to obtain or
maintain any of the policies or insurance required herein or to pay any premium
in whole or in part relating thereto, then the Agent, without waiving or
releasing any obligations or resulting Default hereunder, may at any time or
times thereafter (but shall be under no obligation to do so) obtain and maintain
such policies of insurance and pay such premiums and take any other action with
respect thereto which the Agent deems advisable. All sums so disbursed by the
Agent shall constitute part of the Obligations, payable as provided in this
Agreement. Each such policy maintained by the Borrower or a Subsidiary shall be
subject to a provision that prevents the cancellation thereof without thirty
days' prior written notice to the Borrower or the applicable Subsidiary, and the
Agent.
6.7. Compliance with Laws. The Borrower will, and will cause each
Subsidiary to, comply with all laws, rules, regulations, orders, writs,
judgments, injunctions, decrees or awards to which it may be subject including,
without limitation, (i) Section 302 and Section 906 of the ▇▇▇▇▇▇▇▇-▇▇▇▇▇ Act of
2002, and (ii) except where the failure to do so could not reasonably be
expected to cause or result in the occurrence of a Material Adverse Effect, all
Environmental Laws.
6.8. Maintenance of Properties. Subject to Section 6.12, the Borrower
will, and will cause each Subsidiary to, do all things necessary to maintain,
preserve, protect and keep its Property used in the operation of its business in
good repair, working order and condition, (ordinary wear and tear excepted), and
make all necessary and proper repairs, renewals and replacements so that its
business carried on in connection therewith may be properly conducted at all
times in the ordinary course; provided, however, that the foregoing shall not
prohibit, limit or impair the Borrower's or any Subsidiary's ability to sell or
discontinue the use of, in its reasonable business judgment, any Property.
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6.9. Inspection; Keeping of Books and Records. The Borrower will, and
will cause each Subsidiary to, permit the Agent, by its respective
representatives and agents, to inspect any of the Property, books and financial
records of the Borrower and each Subsidiary, to examine and make copies of the
books of accounts and other financial records of the Borrower and each
Subsidiary, and to discuss the affairs, finances and accounts of the Borrower
and each Subsidiary with, and to be advised as to the same by, their respective
officers at such reasonable times and intervals as the Agent may designate. The
Borrower shall keep and maintain, and cause each of its Subsidiaries to keep and
maintain, in all material respects, proper books of record and account in which
entries in conformity with Agreement Accounting Principles shall be made of all
dealings and transactions in relation to their respective businesses and
activities. If a Default has occurred and is continuing, the Borrower, upon the
Agent's request, shall turn over copies of any such records to the Agent or its
representatives. The Agent agrees that it shall conduct any such inspection or
examination in reasonable accordance with the Borrower's and its Subsidiaries'
safety policies and procedures and shall not materially interfere with or impair
the Borrower's or its Subsidiaries' operations. Without limiting the foregoing,
the Agent shall have the right to enter the Borrower's or any Subsidiary's
premises for any of the purposes described on the Closing Date in Section 11.04
of the Senior Note Indenture and Section 10.04 of the Senior Term Loan
Agreement.
6.10. Restricted Payments. The Borrower will not, nor will it permit any
Subsidiary to, declare or pay any dividend or make any distribution on its
capital stock (other than dividends or other distributions payable in its own
capital stock) or redeem, repurchase or otherwise acquire or retire any of its
capital stock at any time outstanding (any of the foregoing, a "Restricted
Payment"), except that:
(a) any Subsidiary may declare and pay dividends or make
distributions to the Borrower or any Subsidiary Guarantor;
(b) the Borrower and its Subsidiaries may make Restricted Payments
in any calendar year in an aggregate amount not in excess of $30,000,000 so long
as, on a pro forma basis, both immediately before and immediately after the
making of any such Restricted Payment, (i) no Default or Unmatured Default
exists, and (ii) the "Fixed Charge Coverage Ratio" as calculated in Section 6.21
on a rolling four quarter basis equals or exceeds 1.10 to 1.00; and
(c) the Borrower and its Subsidiaries may make Restricted Payments
in any calendar year in an aggregate amount in excess of $30,000,000 but not in
excess of $50,000,000 so long as, on a pro forma basis, both immediately before
and immediately after the making of any such Restricted Payment, (i) no Default
or Unmatured Default exists, (ii) the "Fixed Charge Coverage Ratio" as
calculated in Section 6.21 on a rolling four quarter basis equals or exceeds
1.10 to 1.00, and (iii) Excess Availability equals or exceeds 25% of the
Borrowing Base then in effect.
6.11. Merger. The Borrower will not, nor will it permit any Subsidiary to,
merge or consolidate with or into any other Person, except that a Subsidiary may
merge into the Borrower or a Wholly Owned Subsidiary that is party to the
Guaranty.
69
6.12. Sale of Assets. The Borrower will not, nor will it permit any
Subsidiary to, lease, sell or otherwise dispose of its Property to any other
Person, except:
6.12.1 Sales of inventory in the ordinary course of business.
6.12.2 A disposition of assets by a Subsidiary to the Borrower or a
Subsidiary Guarantor or by the Borrower to a Subsidiary Guarantor.
6.12.3 A disposition of obsolete property, property no longer used
in the business of the Borrower or its Subsidiaries or other assets in the
ordinary course of business of the Borrower or any Subsidiary.
6.12.4 Sales of Retail Property.
6.12.5 Leases, sales or other dispositions of its Property that,
together with all other Property of the Borrower and its Subsidiaries
previously leased, sold or disposed of (other than dispositions otherwise
permitted by this Section 6.12) as permitted by this Section during the
twelve-month period ending with the month in which any such lease, sale or
other disposition occurs, do not result in proceeds (including non-cash
proceeds, whether in the form of an instrument or otherwise) in excess of
$30,000,000; provided, however, that the Borrower and its Subsidiaries may
lease, sell, or otherwise dispose of Property which results in proceeds
(including non-cash proceeds, whether in the form of an instrument or
otherwise) in excess of the aforementioned $30,000,000 limitation if (i)
immediately before and immediately after such lease, sale, or disposition,
no Default or Unmatured Default exists, and (ii) the Borrower or the
applicable Subsidiary demonstrates to the Agent's satisfaction, on a pro
forma basis for the four fiscal quarter period reflected in the compliance
certificate most recently delivered to the Agent pursuant to Section
6.1.4, and without giving effect to the Property to be subject to such
lease, sale or other disposition, that the Borrower's "Fixed Charge
Coverage Ratio" as calculated in Section 6.21 on a rolling four quarter
basis equals or exceeds 1.00 to 1.00.
6.13. Investments and Acquisitions. The Borrower will not, nor will it
permit any Subsidiary to, make or suffer to exist any Investments (including
without limitation, loans and advances to, and other Investments in,
Subsidiaries), or commitments therefor, or to create any Subsidiary or to become
or remain a partner in any partnership or joint venture, or to make any
Acquisition of any Person, except:
6.13.1 Cash Equivalent Investments.
6.13.2 Existing Investments in Subsidiary Guarantors and other
Investments in existence on the date hereof and described in Schedule
6.13.
6.13.3 Acquisitions meeting the following requirements, or otherwise
approved by the Required Lenders (each such Acquisition constituting a
"Permitted Acquisition"):
(i) as of the date of the consummation of such Acquisition, no Default
or Unmatured Default shall have occurred and be continuing or would
result from such
70
Acquisition, and the representation and warranty contained in
Section 5.11 shall be true both before and after giving effect to
such Acquisition;
(ii) such Acquisition is consummated on a non-hostile basis pursuant to a
negotiated acquisition agreement approved by the board of directors
or other applicable governing body of the seller or entity to be
acquired, and no material challenge to such Acquisition (excluding
the exercise of appraisal rights) shall be pending or threatened by
any shareholder or director of the seller or entity to be acquired;
(iii) the business to be acquired in such Acquisition is similar or
related to one or more of the lines of business in which the
Borrower and its Subsidiaries are engaged on the Closing Date;
(iv) as of the date of the consummation of such Acquisition, all material
governmental and corporate approvals required in connection
therewith shall have been obtained;
(v) the Purchase Price for each such Acquisition together with the
Purchase Price of all other Permitted Acquisitions shall not exceed
an amount equal to (a) $50,000,000 during any period of twelve
consecutive months; and (b) $100,000,000 during the period beginning
on the Closing Date and ending on the Termination Date; provided,
however, the aggregate Purchase Price for all such Acquisitions may
exceed the aforementioned $50,000,000 and $100,000,000 limitations
if any such excess amount was paid solely with Other Senior Secured
Debt Collateral Proceeds;
(vi) with respect to each Permitted Acquisition, not less than thirty
(30) days prior to the consummation of such Permitted Acquisition,
the Borrower shall have delivered to the Agent a pro forma
consolidated balance sheet, income statement and cash flow statement
of the Borrower and its Subsidiaries (the "Acquisition Pro Forma"),
based on the Borrower's most recent financial statements delivered
pursuant to Section 6.1.1 and using historical financial statements
for the acquired entity provided by the seller(s) or which shall be
complete and shall fairly present, in all material respects, the
financial condition and results of operations and cash flows of the
Borrower and its Subsidiaries in accordance with Agreement
Accounting Principles, but taking into account such Permitted
Acquisition and the funding of all Credit Extensions in connection
therewith, and such Acquisition Pro Forma shall reflect that, on a
pro forma basis, for the four fiscal quarter period reflected in the
compliance certificate most recently delivered to the Agent pursuant
to Section 6.1.4 prior to the consummation of such Permitted
Acquisition (giving effect to such Permitted Acquisition and all
Credit Extensions funded in connection therewith as if made on the
first day of such period), the Borrower's "Fixed Charge Coverage
Ratio" as calculated in Section 6.21 on a rolling four quarter basis
is equal to or greater than 1.10 to 1.00 and that Excess
Availability equals or exceeds 25% of the Borrowing Base then in
effect; and
71
(vii) prior to each such Permitted Acquisition, the Borrower shall deliver
to the Agent a documentation, information and certification package
in form and substance acceptable to the Agent, including, without
limitation;
(A) all of the Collateral Documents necessary for the perfection
of a first priority security interest in all of the assets to
be acquired that constitute or qualify as Collateral,
including, without limitation, Petroleum Inventory,
Receivables and related cash or cash equivalents, instruments,
general intangibles and intercompany Indebtedness;
(B) a supplement to the Guaranty if the Permitted Acquisition is
an Acquisition of equities and the target company will not be
merged with the Borrower or any existing Subsidiary Guarantor;
(C) financial information for the target entity in form and
substance reasonably acceptable to the Agent;
(D) a copy of the acquisition agreement for such Acquisition,
together with drafts of the material schedules thereto;
(E) a copy of all documents, instruments and agreements with
respect to any Indebtedness to be incurred or assumed in
connection with such Acquisition; and
(F) such other documents or information as shall be reasonably
requested by any Agent or any Lender.
6.14. Indebtedness. The Borrower will not, nor will it permit any
Subsidiary to, create, incur or suffer to exist any Indebtedness, except:
6.14.1 The Obligations and the Other Senior Secured Debt so long as
the aggregate principal amount of the Other Senior Secured Debt does not
at any time exceed $725,000,000; provided, however, that any increase in
the aggregate principal amount of the Other Senior Secured Debt above
$575,000,000 shall require the Agent's prior consent thereto.
6.14.2 Indebtedness existing on the date hereof and described in
Schedule 6.14, together with any Refinancing Indebtedness in respect
thereof.
6.14.3 Indebtedness arising under Rate Management Transactions;
6.14.4 Purchase money Indebtedness, whether secured or unsecured
(including Capitalized Leases), incurred by the Borrower or any of its
Subsidiaries after the Closing Date to finance the acquisition of assets
used in its business, if (1) at the time of such incurrence, no Default or
Unmatured Default has occurred and is continuing or would result from such
incurrence, (2) such Indebtedness does not exceed the lower of the fair
market value or the cost of the applicable assets on the date acquired,
(3) such Indebtedness does not exceed the lower of the fair market value
or the costs of the
72
applicable assets on the date acquired, (4) such Indebtedness does not
exceed $100,000,000 in the aggregate outstanding at any time, and (5) any
Lien securing such Indebtedness is permitted under Section 6.15 (such
Indebtedness being referred to herein as "Permitted Purchase Money
Indebtedness").
6.14.5 Indebtedness arising from intercompany loans and advances (i)
made by any Subsidiary to the Borrower or any Subsidiary Guarantor, (ii)
made by the Borrower to any Subsidiary Guarantor, or (iii) made by the
Borrower to any Excluded Subsidiary or Wholly-Owned Subsidiary not
constituting a Subsidiary Guarantor in an aggregate principal amount in
Dollars not to exceed $10,000,000 at any time for all such Indebtedness;
provided that all such Indebtedness shall be expressly subordinated to the
Secured Obligations.
6.14.6 Indebtedness not described in or otherwise subject to
Sections 6.14.1 through 6.14.5 that is unsecured and that does not at any
time exceed an aggregate amount equal to $75,000,000; provided, however,
that the Borrower shall not incur more than $25,000,000 of unsecured
Indebtedness under this Section 6.14.6 without the Agent's prior consent.
6.15. Liens; Negative Pledge. The Borrower will not, nor will it permit
any Subsidiary to, create, incur, or suffer to exist any Lien in, of or on the
Property of the Borrower or any of its Subsidiaries, except for the following,
which are permitted hereunder:
6.15.1 Liens, if any, securing (x) Secured Obligations, and (y)
Other Senior Secured Debt permitted under Section 6.14.1.
6.15.2 Liens for taxes, assessments or governmental charges or
levies on its Property if the same shall not at the time be delinquent or
thereafter can be paid without penalty, or are being contested in good
faith and by appropriate proceedings and for which adequate reserves in
accordance with Agreement Accounting Principles shall have been set aside
on its books.
6.15.3 Liens for landlords', wage earners', carriers',
warehousemen's and mechanics' liens and other similar liens arising in the
ordinary course of business which secure payment of obligations not more
than 45 days past due or which are being contested in good faith by
appropriate proceedings and for which adequate reserves in accordance with
Agreement Accounting Principles shall have been set aside on its books.
6.15.4 Liens arising out of pledges or deposits under worker's
compensation laws, unemployment insurance, old age pensions, or other
social security or retirement benefits, or similar legislation.
6.15.5 Liens existing on the date hereof and described in Schedule
6.15.
6.15.6 Deposits securing liability to insurance carriers under
insurance or self-insurance arrangements.
73
6.15.7 Deposits to secure the performance of bids, trade contracts
(other than for borrowed money), leases, statutory obligations, surety and
appeal bonds, performance bonds and other obligations of a like nature
incurred in the ordinary course of business.
6.15.8 Easements, reservations, rights-of-way, restrictions, survey
exceptions and other similar encumbrances as to real property of the
Borrower and its Subsidiaries which customarily exist on properties of
corporations engaged in similar activities and similarly situated and
which do not materially interfere with the conduct of the business of the
Borrower or such Subsidiary conducted at the property subject thereto.
6.15.9 Liens arising by reason of any judgment, decree or order of
any court or other governmental authority, if appropriate legal
proceedings are being diligently prosecuted and shall not have been
finally terminated or the period within which such proceedings may be
initiated shall not have expired, in an aggregate amount not to at any
time exceed $15,000,000.
6.15.10 Liens existing on any asset of any Subsidiary of the
Borrower at the time such Subsidiary becomes a Subsidiary and not created
in contemplation of such event.
6.15.11 Liens on any asset securing Indebtedness incurred or assumed
for the purpose of financing or refinancing all or any part of the cost of
acquiring or constructing such asset; provided that such Lien attaches to
such asset concurrently with or within eighteen (18) months after the
acquisition or completion or construction thereof.
6.15.12 Liens existing on any asset of any Subsidiary of the
Borrower at the time such Subsidiary is merged or consolidated with or
into the Borrower or any Subsidiary and not created in contemplation of
such event.
6.15.13 Liens existing on any asset prior to the acquisition thereof
by the Borrower or any Subsidiary and not created in contemplation
thereof; provided that such Liens do not encumber any other property or
assets.
6.15.14 Liens arising out of the refinancing, extension, renewal or
refunding of any Indebtedness secured by any Lien permitted under Sections
6.15.11 through 6.15.14; provided that (a) such Indebtedness is not
secured by any additional assets, and (b) the amount of such Indebtedness
secured by any such Lien is not increased.
6.15.15 Purchase money Liens securing Permitted Purchase Money
Indebtedness (as defined in Section 6.14); provided, that such Liens shall
not apply to any property of the Borrower or its Subsidiaries other than
that purchased with the proceeds of such Permitted Purchase Money
Indebtedness.
6.15.16 any Lien securing Indebtedness, neither assumed nor
guaranteed by the Borrower or any of its Subsidiaries nor on which it
customarily pays interest, existing upon real estate or rights in or
relating to real estate acquired by the Borrower for substation, metering
station, pump station, storage, gathering line, transmission line,
transportation line, distribution line or for right-of-way purposes, any
Liens reserved in leases for rent and for compliance with the terms of the
leases in the case of leasehold
74
estates, to the extent that any such Lien referred to in this Section
6.15.16 does not materially impair the use of the Property covered by such
Lien for the purposes of which such Property is held by the Borrower or
any of its Subsidiaries.
6.15.17 Liens arising under ERISA provided that such Liens do not
secure liabilities which, in the aggregate, equal or exceed $5,000,000.
6.15.18 any obligations or duties affecting any of the Property of
the Borrower or its Subsidiaries to any municipality or public authority
with respect to any franchise, grant, license or permit which do not
materially impair the use of such Property for the purposes for which it
is held.
6.15.19 defects, irregularities and deficiencies in title of any
rights of way or other Property constituting real estate of the Borrower
or any Subsidiary thereof which in the aggregate do not materially impair
the use of such rights of way or other Property constituting real estate
for the purposes for which such rights of way and other Property
constituting real estate are held by the Borrower or any Subsidiary, and
defects, irregularities and deficiencies in title to any Property
constituting real estate of the Borrower or its Subsidiaries, which
defects, irregularities or deficiencies have been cured by possession
under applicable statues of limitation.
6.15.20 any interest or title of a lessor under any lease entered
into by the Borrower or any other Subsidiary in the ordinary course of its
business and covering only the assets so leased.
6.15.21 Liens in favor of collecting or payor banks having a right
of setoff, revocation, refund or chargeback with respect to money or
instruments of the Borrower or any of its Subsidiaries on deposit with or
in possession of such bank.
6.15.22 Liens upon Retail Property not constituting Collateral.
6.15.23 Liens in favor of counterparties arising in connection with
the Borrower's or any Subsidiary's commodity hedging activities,
including, without limitation, hydrocarbon hedging.
Notwithstanding the foregoing or anything to the contrary contained in any Loan
Document, neither the Borrower nor any Subsidiary shall pledge, encumber or
otherwise ▇▇▇▇▇ ▇ ▇▇▇▇ to any Person upon any equity interest held by the
Borrower or such Subsidiary in any other Subsidiary or an Affiliate of the
Borrower or such Subsidiary, except for equity interests in the Pipeline
Subsidiaries granted by the Borrower to the Multiparty Collateral Agent in order
to secure Other Senior Secured Debt.
6.16. Affiliates. The Borrower will not, and will not permit any
Subsidiary to, enter into any transaction (including, without limitation, the
purchase or sale of any Property or service) with, or make any payment or
transfer to, any Affiliate (other than the Borrower and its Subsidiaries) except
in the ordinary course of business and pursuant to the reasonable requirements
of the Borrower's or such Subsidiary's business and upon fair and reasonable
terms
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no less favorable to the Borrower or such Subsidiary than the Borrower or such
Subsidiary would obtain in a comparable arm's-length transaction.
6.17. Financial Contracts. The Borrower will not, nor will it permit any
Subsidiary to, enter into or remain liable upon any Rate Management Transactions
except for those entered into in the ordinary course of business for bona fide
hedging purposes and not for speculative purposes.
6.18. Subsidiary Covenants. The Borrower will not, and will not permit any
Subsidiary to, create or otherwise cause to become effective any consensual
encumbrance or restriction of any kind on the ability of any Subsidiary (i) to
pay dividends or make any other distribution on its stock, (ii) to pay any
Indebtedness or other obligation owed to the Borrower or any other Subsidiary,
(iii) to make loans or advances or other Investments in the Borrower or any
other Subsidiary, or (iv) to sell, transfer or otherwise convey any of its
property to the Borrower or any other Subsidiary.
6.19. Contingent Obligations. The Borrower will not, nor will it permit
any Subsidiary to, make or suffer to exist any Contingent Obligation (including,
without limitation, any Contingent Obligation with respect to the obligations of
a Subsidiary), except (i) by endorsement of instruments for deposit or
collection in the ordinary course of business, (ii) the Reimbursement
Obligations, (iii) any guaranty of the Secured Obligations, (iv) any guaranty of
Other Senior Secured Debt, and (v) Contingent Obligations arising in connection
with Indebtedness permitted under Section 6.14.
6.20. Amendments to Agreements. The Borrower will not amend, modify or
supplement, or permit any Subsidiary to amend, modify or supplement (or consent
to any amendment, modification or supplement of), any document, agreement or
instrument evidencing the Senior Notes or the Senior Term Loans (or any
replacements, substitutions or renewals thereof), or pursuant to which the
Senior Notes or the Senior Term Loans are issued or extended, where such
amendment, modification or supplement provides for the following or which has
any of the following effects:
(a) increases the overall principal amount of any such
Indebtedness or increases the amount of any single scheduled installment of
principal or interest in excess of amounts otherwise permitted under this
Agreement;
(b) shortens or accelerates the date upon which any installment of
principal or interest becomes due or adds any additional mandatory redemption
provisions;
(c) shortens the final maturity date of such Indebtedness or
otherwise accelerates the amortization schedule with respect to such
Indebtedness;
(d) increases the rate of interest accruing on such Indebtedness;
(e) provides for the payment of additional fees or increases
existing fees other than amendment fees paid in the ordinary course;
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(f) amends or modifies any financial or negative covenant (or
covenant which prohibits or restricts the Borrower or any of its Subsidiaries
from taking certain actions) in a manner which is more onerous or more
restrictive in any material respect to the Borrower or such Subsidiary or which
is otherwise materially adverse to the Borrower, its Subsidiaries and/or the
Lenders or, in the case of adding covenants, which places material additional
restrictions on the Borrower or such Subsidiary or which requires the Borrower
or such Subsidiary to comply with more restrictive financial ratios or which
requires the Borrower to better its financial performance from that set forth in
the existing financial covenants (taking into account the aggregate adjustments,
if any, to the thresholds and exceptions applicable thereto on a covenant by
covenant basis);
(g) results in this Agreement, the other Loan Documents, and the
credit facilities evidenced hereby, not constituting a "Qualified Credit
Facility" under the Senior Note Indenture or the Senior Term Loan Agreement; or
(h) amends, modifies or adds any affirmative covenant in a manner
which, when taken as a whole, is materially adverse to the Borrower, its
Subsidiaries and/or the Lenders.
6.21. Fixed Charge Coverage Ratio. The Borrower, as of the end of the
following fiscal quarters, will not permit the ratio of (x) Consolidated EBITDA,
minus expenses for cash federal income taxes paid, minus Net Consolidated
Capital Expenditures, minus Restricted Payments, to (y) Fixed Charges, all
calculated for the Borrower and its Subsidiaries, on a consolidated basis, and
without duplication with respect to Capitalized Leases, to be less than 1.00 to
1.00 for each fiscal quarter, beginning with the fiscal quarter ending June 30,
2003, and with compliance for each such fiscal quarter based upon the four then
most-recently ended fiscal quarters; provided, however, that the aforementioned
ratio may be less than 1.00 to 1.00 for any fiscal quarter if Excess
Availability at the end of such fiscal quarter exceeds 15% of the Borrowing Base
then in effect.
6.22. Minimum Consolidated Tangible Net Worth. The Borrower will at all
times maintain Consolidated Tangible Net Worth of not less than (i)
$547,000,000, plus (ii) 75% of Consolidated Net Income (if positive) earned in
each fiscal quarter beginning with the fiscal quarter ending March 31, 2004,
plus (iii) 75% of the amount of all Net Cash Proceeds resulting from any
issuance of the Borrower's or any Subsidiary's capital stock.
6.23. Subsidiary Collateral Documents; Subsidiary Guarantors. The Borrower
shall execute or shall cause to be executed:
(i) on the date any Person that is organized under the laws of the United
States or any political subdivision thereof becomes a Subsidiary of the
Borrower, (a) a supplement to the Guaranty pursuant to which such Person
shall become a party thereto; provided, that such Person shall not
guaranty any of its own obligations owing to the Holders of Secured
Obligations or Secured Obligations that arose prior to its becoming a
party to the Guaranty, (b) a Security Agreement in substantially the form
executed on April 17, 2003 (or a supplement thereto); and (c) a supplement
to Schedule 5.8 identifying the applicable additional new Subsidiary
Guarantor;
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(ii) in order to further effect the requirements of this Section 6.23, the
Borrower shall deliver or cause to be delivered to the Agent all
Collateral Documents, together with appropriate corporate resolutions and
other documentation (including opinions of counsel, UCC financing
statements, and such other documents as shall be reasonably requested to
perfect the Agent's Lien), in each case in form and substance reasonably
satisfactory to the Agent, necessary to reasonably satisfy the Agent that
it has a first priority perfected pledge of, security interest in and Lien
upon the Collateral owned by such new Subsidiary Guarantor.
(iii) The Borrower shall cause each Subsidiary Guarantor to acknowledge
and agree that such Subsidiary Guarantor's entry into the Guaranty is a
condition to and is given as an inducement for and in consideration of
credit accommodations extended to the Borrower under this Agreement and
the other Loan Documents and not for any credit accommodation extended to
such Subsidiary Guarantor.
(iv) This Section 6.23 shall not apply with respect to Excluded
Subsidiaries, including, without limitation, Pipeline Subsidiaries.
6.24. Insurance and Condemnation Proceeds. The Borrower directs (and, if
applicable, shall cause its Subsidiaries to direct) all insurers under policies
relating to Property constituting Collateral to pay all proceeds payable under
such policies or with respect to such claim or award for any loss with respect
to the Collateral directly to the Agent, for the benefit of the Agent and the
Holders of the Secured Obligations; provided, however, in the event that such
proceeds or awards are less than $1,000,000 ("Excluded Proceeds"), unless a
Default shall have occurred and be continuing, the Agent shall remit such
Excluded Proceeds to the Borrower. Such amounts shall reduce outstanding
principal Obligations pursuant to the mandatory prepayment provision of Section
2.2. Each such policy shall contain a long-form loss-payable endorsement naming
the Agent as loss payee, which endorsement shall be in form and substance
acceptable to the Agent.
6.25. Collection Accounts. The Borrower and its Subsidiaries shall cause
the majority of their deposit, collection and other cash management accounts to
be maintained with Bank One, NA or an Affiliate thereof. The Borrower and its
Subsidiaries shall cause all collections of Receivables constituting Collateral
and all proceeds of Collateral to be directly deposited into collection accounts
(such accounts, "Collection Accounts") subject to account control agreements, in
form and substance acceptable to the Agent, which grant the Agent control over
and a first-priority perfected security interest in such collection accounts,
including, without limitation, amounts and other items on deposit therein.
Amounts and other items on deposit in Collection Accounts that are not
maintained with Bank One, NA or an Affiliate thereof shall be transferred at
least once a week to one or more Collection Accounts maintained with Bank One,
NA or an Affiliate thereof. If any collections are received by the Borrower, a
Subsidiary, or any other Person, such collections shall be deemed to have been
received by the Borrower, such Subsidiary or such other Person in trust for the
Agent, and, upon the Borrower's, such Subsidiary's, or such other Person's
receipt thereof, the Borrower shall (or shall cause such Subsidiary or other
Person) to immediately remit all of such collections, in their original form, to
the Agent, Bank One or an Affiliate thereof for deposit into a Collection
Account. Following the occurrence and during the continuance of a Default, all
amounts received by the Agent, all amounts on deposit in the Collection
Accounts, and all amounts constituting collections required
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to be deposited into Collection Accounts shall be the sole property of the Agent
for the benefit of the Holders of Secured Obligations and shall be deemed
received by the Agent for application to the Secured Obligations pursuant to the
terms of this Agreement. With respect to any Collection Account described in
this Section 6.25, the Borrower and its Subsidiaries shall have 90 days from the
later of the Closing Date and the date on which such Collection Account is
opened or converted to cause such account to become subject to one of the
aforementioned account control agreements. The Pre-Funded Letter of Credit
Account shall not constitute a Collection Account.
6.26. Subordinated Indebtedness. The Borrower will not, and will not
permit any Subsidiary to, make any amendment or modification to any indenture,
note agreement or other agreement, document or instrument evidencing or
governing Subordinated Indebtedness or directly or indirectly voluntarily
prepay, defease, or in substance defease, purchase, redeem, retire, or otherwise
acquire, any Subordinated Indebtedness unless, with respect to a prepayment,
defeasance, purchase, redemption, retirement or acquisition, the Subordinated
Indebtedness Prepayment Conditions have been satisfied.
6.27. Multiemployer Plans. The Borrower will not, nor will it permit any
Subsidiary to, become a party to a Multiemployer Plan.
6.28. Consolidated Capital Expenditures. At any time Non-Lender Asset Sale
Proceeds are on deposit in accounts subject to the Multiparty Collateral Agent's
control, including, without limitation, any "Asset Sale Proceeds Account"
described in the Senior Note Indenture and the Senior Term Loan Agreement, the
Borrower shall, and shall cause each Subsidiary to, fund all Consolidated
Capital Expenditures with respect to Property constituting or required to
constitute collateral securing Other Senior Secured Debt under the Senior Note
Indenture and the Senior Term Loan Agreement and otherwise permitted hereunder
with such Non-Lender Asset Sale Proceeds prior to using any other amounts to
fund such Consolidated Capital Expenditures.
ARTICLE VII
DEFAULTS
The occurrence of any one or more of the following events shall constitute
a Default:
7.1. Any representation or warranty made or deemed made by or on behalf
of the Borrower or any of its Subsidiaries to the Lenders or the Agent under or
in connection with this Agreement, any Credit Extension, or any certificate or
information delivered in connection with this Agreement or any other Loan
Document shall be false in any material respect on the date as of which made or
deemed made.
7.2. Nonpayment of (i) principal of any Loan when due, (ii) any
Reimbursement Obligation within one Business Day after the same becomes due,
(iii) any Pre-Funded Account Reimbursement Amount when due under Section 2.19.6,
or (iv) interest upon any Loan or any Commitment Fee, LC Fee, or other
Obligations under any of the Loan Documents within one (1) Business Day after
such interest, fee or other Obligation becomes due.
7.3. The breach by the Borrower of any of the terms or provisions of
Section 6.1.11, 6.2, 6.3, 6.4, 6.6, 6.7, 6.9, 6.10, 6.11, 6.12, 6.13, 6.14, 6.15
(to the extent related to or affecting
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Property constituting or required to constitute Collateral), 6.16, 6.17, 6.18,
6.19, 6.20, 6.21, 6.22, 6.24, 6.25, 6.26, 6.27, or 6.28.
7.4. The breach by the Borrower (other than a breach which constitutes a
Default under another Section of this Article VII) of:
(i) Section 6.1.9 (solely with respect to the Interim Collateral Reports
described therein) or Section 6.15 (to the extent related to or affecting
Property not constituting or not required to constitute Collateral) and such
breach is not remedied within two (2) Business Days of the earlier to occur of
(x) written notice from the Agent or any Lender to the Borrower or (y) an
Authorized Officer otherwise becomes aware of any such breach;
(ii) Section 6.1.1, 6.1.2, 6.1.3, 6.1.4, 6.1.6, 6.1.7, 6.1.9 (solely with
respect to the Monthly Collateral Reports described therein), 6.1.10, 6.1.12 or
6.1.13 and such breach is not remedied within five (5) Business Days of the
earlier to occur of (x) written notice from the Agent or any Lender to the
Borrower or (y) an Authorized Officer otherwise becomes aware of any such
breach; or
(iii) any of the other terms or provisions of this Agreement or any Loan
Document which is not remedied within twenty (20) Business Days after the
earlier to occur of (x) written notice from the Agent or any Lender to the
Borrower or (y) an Authorized Officer otherwise becomes aware of any such
breach.
7.5. Failure of the Borrower or any of its Subsidiaries to pay when due
any Material Indebtedness; or the default by the Borrower or any of its
Subsidiaries in the performance (beyond the applicable grace period with respect
thereto, if any) of any term, provision or condition contained in any Material
Indebtedness Agreement, or any other event shall occur or condition exist, the
effect of which default, event or condition is to cause, or to permit the
holder(s) of such Material Indebtedness or the lender(s) under any Material
Indebtedness Agreement to cause, such Material Indebtedness to become due prior
to its stated maturity or any commitment to lend under any Material Indebtedness
Agreement to be terminated prior to its stated expiration date; or any Material
Indebtedness of the Borrower or any of its Subsidiaries shall be declared to be
due and payable or required to be prepaid or repurchased (other than by a
regularly scheduled payment) prior to the stated maturity thereof; or the
Borrower or any of its Subsidiaries shall not pay, or admit in writing its
inability to pay, its debts generally as they become due.
7.6. The Borrower or any of its Subsidiaries shall (i) have an order for
relief entered with respect to it under the Federal bankruptcy laws as now or
hereafter in effect, (ii) make an assignment for the benefit of creditors, (iii)
apply for, seek, consent to, or acquiesce in, the appointment of a receiver,
custodian, trustee, examiner, liquidator or similar official for it or any
Substantial Portion of its Property, (iv) institute any proceeding seeking an
order for relief under the Federal bankruptcy laws as now or hereafter in effect
or seeking to adjudicate it a bankrupt or insolvent, or seeking dissolution,
winding up, liquidation, reorganization, arrangement, adjustment or composition
of it or its debts under any law relating to bankruptcy, insolvency or
reorganization or relief of debtors or fail to file an answer or other pleading
denying the material allegations of any such proceeding filed against it, (v)
take any corporate or partnership action to
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authorize or effect any of the foregoing actions set forth in this Section 7.6
or (vi) fail to contest in good faith any appointment or proceeding described in
Section 7.7.
7.7. Without the application, approval or consent of the Borrower or any
of its Subsidiaries, a receiver, trustee, examiner, liquidator or similar
official shall be appointed for the Borrower or any of its Subsidiaries or any
Substantial Portion of its Property, or a proceeding described in Section
7.6(iv) shall be instituted against the Borrower or any of its Subsidiaries and
such appointment continues undischarged or such proceeding continues undismissed
or unstayed for a period of 45 consecutive days.
7.8. Any court, government or governmental agency shall condemn, seize or
otherwise appropriate, or take custody or control of, all or any portion of the
Property of the Borrower and its Subsidiaries which, when taken together with
all other Property of the Borrower and its Subsidiaries so condemned, seized,
appropriated, or taken custody or control of, during the twelve-month period
ending with the month in which any such action occurs, constitutes a Substantial
Portion.
7.9. The Borrower or any of its Subsidiaries shall fail within 30 days to
pay, bond or otherwise discharge one or more (i) judgments or orders for the
payment of money in excess of $15,000,000 (or the equivalent thereof in
currencies other than Dollars) in the aggregate, or (ii) nonmonetary judgments
or orders which, individually or in the aggregate, could reasonably be expected
to have a Material Adverse Effect, which judgment(s), in any such case, is/are
not stayed on appeal or otherwise being appropriately contested in good faith.
7.10. The Unfunded Liabilities of all Single Employer Plans shall exceed
$75,000,000 in the aggregate, or any Reportable Event shall occur in connection
with any Plan.
7.11. Any Change in Control shall occur.
7.12. The Borrower or any of its Subsidiaries shall (i) be the subject of
any proceeding or investigation pertaining to the release by the Borrower, any
of its Subsidiaries or any other Person of any toxic or hazardous waste or
substance into the environment, or (ii) violate any Environmental Law, which, in
the case of an event described in clause (i) or clause (ii), has resulted in
liability to the Borrower or any of its Subsidiaries in an amount equal to
$30,000,000 or more, which liability is not paid, bonded, covered in its
entirety by an insurance policy provided to the Borrower or the applicable
Subsidiary by a non-Affiliate, or otherwise discharged within 45 days or which
is not stayed on appeal and being appropriately contested in good faith.
7.13. Any Loan Document shall fail to remain in full force or effect or
any action shall be taken to discontinue or to assert the invalidity or
unenforceability of any Loan Document or any Lien in favor of the Agent under
the Loan Documents, or such Lien shall not have the priority contemplated by the
Loan Documents.
7.14. An event (such event, an "Off-Balance Sheet Trigger Event") shall
occur which (i) permits the investors or purchasers in respect of Off-Balance
Sheet Liabilities of the Borrower or any Affiliate of the Borrower to require
the amortization or liquidation of such Off-Balance Sheet Liabilities and (x)
such Off-Balance Sheet Trigger Event shall not be remedied or waived
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within the later to occur of the tenth day after the occurrence thereof or the
expiry date of any grace period related thereto under the agreement evidencing
such Off-Balance Sheet Liabilities, or (y) such investors shall require the
amortization or liquidation of such Off-Balance Sheet Liabilities as a result of
such Off-Balance Sheet Trigger Event, (ii) results in the termination of
reinvestments of collections or proceeds of receivables and related assets under
the agreements evidencing such Off-Balance Sheet Liabilities, or (iii) causes or
otherwise permits the replacement or substitution of the Borrower or any
Affiliate thereof as the servicer under the agreements evidencing such
Off-Balance Sheet Liabilities; provided, however, that this Section 7.14 shall
not apply on any date with respect to any voluntary request by the Borrower or
an Affiliate thereof for an above-described amortization, liquidation, or
termination of reinvestments so long as the aforementioned investors or
purchasers cannot independently require on such date such amortization,
liquidation or termination of reinvestments.
ARTICLE VIII
ACCELERATION, WAIVERS, AMENDMENTS AND REMEDIES
8.1. Acceleration. (i) If any Default described in Section 7.6 or 7.7
occurs with respect to the Borrower, the obligations of the Lenders to make
Loans hereunder, and the obligation and power of the LC Issuers to issue
Facility LCs shall automatically terminate and the Secured Obligations shall
immediately become due and payable without any election or action on the part of
the Agent, any LC Issuer, or any Lender. With respect to Facility LCs, the
Borrower will be and become thereby unconditionally obligated, without any
further notice, act or demand, to pay the Agent an amount in immediately
available funds, which funds shall be held in the Facility LC Collateral
Account, equal to the difference of (x) the amount of LC Obligations at such
time less (y) the amount or deposit in the Facility LC Collateral Account at
such time which is free and clear of all rights and claims of third parties and
has not been applied against the Obligations (the "Collateral Shortfall
Amount"). If any other Default occurs, the Required Lenders (or the Agent with
the consent of the Required Lenders) may (a) terminate or suspend the
obligations of the Lenders to make Loans hereunder and the obligation and power
of the LC Issuers to issue Facility LCs, or declare the Secured Obligations to
be due and payable, or both, whereupon the Secured Obligations shall become
immediately due and payable, without presentment, demand, protest or notice of
any kind, all of which the Borrower hereby expressly waives and (b) upon notice
to the Borrower and in addition to the continuing right to demand payment of all
amounts payable under this Agreement, make demand on the Borrower to pay, and
the Borrower will forthwith upon such demand and without any further notice or
act pay to the Agent the Collateral Shortfall Amount which funds shall be
deposited in the Facility LC Collateral Account.
(ii) If at any time while any Default is continuing, the Agent determines
that the Collateral Shortfall Amount at such time is greater than zero, the
Agent may make demand on the Borrower to pay, and the Borrower will, forthwith
upon such demand and without any further notice or act, pay to the Agent the
Collateral Shortfall Amount, which funds shall be deposited in the Facility LC
Collateral Account.
(iii) The Agent may at any time or from time to time after funds are
deposited in the Facility LC Collateral Account, apply such funds to the payment
of the Secured Obligations and
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any other amounts as shall from time to time have become due and payable by the
Borrower to the Lenders or the LC Issuers under the Loan Documents.
(iv) At any time while any Default is continuing, neither the Borrower
nor any Person claiming on behalf of or through the Borrower shall have any
right to withdraw any of the funds held in the Facility LC Collateral Account.
After all of the Secured Obligations have been indefeasibly paid in full and the
Aggregate Revolving Loan Commitment has been terminated, any funds remaining in
the Facility LC Collateral Account shall be returned by the Agent to the
Borrower or paid to whomever may be legally entitled thereto at such time.
(v) If, after acceleration of the maturity of the Obligations or
termination of the obligations of the Lenders to make Loans and the obligation
and power of the LC Issuers to issue Facility LCs hereunder as a result of any
Default (other than any Default as described in Section 7.6 or 7.7 with respect
to the Borrower) and before any judgment or decree for the payment of the
Obligations due shall have been obtained or entered, the Required Lenders (in
there sole discretion) shall so direct, the Agent shall, by notice to the
Borrower, rescind and annul such acceleration and/or termination.
8.2. Amendments. Subject to the provisions of this Section 8.2, the
Required Lenders (or the Agent with the consent in writing of the Required
Lenders) and the Borrower may enter into agreements supplemental hereto for the
purpose of adding or modifying any provisions to the Loan Documents, including,
without limitation, the Intercreditor Agreement, or changing in any manner the
rights of the Lenders or the Borrower hereunder or thereunder or waiving any
Default hereunder or thereunder; provided, however, that no such supplemental
agreement shall, without the consent of all of the Lenders:
8.2.1 Extend the Termination Date, extend the final maturity of any
Loan, extend the expiry date of any Facility LC to a date after the
Termination Date, or postpone any regularly scheduled payment of principal
of any Loan or forgive all or any portion of the principal amount thereof,
or any Reimbursement Obligation related thereto, or reduce the rate or
extend the time of payment of interest or fees thereon or Reimbursement
Obligations related thereto (other than (x) a waiver of the application of
the default rate of interest pursuant to Section 2.10 hereof and (y) any
reduction of the amount of or any extension of the payment date for the
mandatory payments required under Section 2.2 (other than Section 2.2.1),
in each case which shall only require the approval of the Required
Lenders).
8.2.2 Reduce the percentage specified in the definition of Required
Lenders or any other percentage of Lenders specified to be the applicable
percentage in this Agreement to act on specified matters or amend the
definitions of "Required Lenders," "Pro Rata Share" or "Revolving Loan Pro
Rata Share."
8.2.3 Increase the amount of the Revolving Loan Commitment or the
Pre-Funded Letter of Credit Commitment of any Lender hereunder or the
commitment to issue Facility LCs, require any Lender with a Credit Linked
Deposit to increase the size thereof or make any deposit into the
Pre-Funded Letter of Credit Account in excess of its Pre-
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Funded Letter of Credit Commitment, or permit the Borrower to assign its
rights or obligations under this Agreement.
8.2.4 Amend, modify or waive this Section 8.2.
8.2.5 Other than in connection with a transaction permitted under
this Agreement, release in any calendar year Collateral with an aggregate
value equal to or in excess of $10,000,000.
8.2.6 Other than in connection with a transaction permitted under
this Agreement, release any Subsidiary party to the Guaranty from its
obligations thereunder.
8.2.7 Increase the advance rate percentages for Perfected Cash
Interests, Eligible Receivables and Eligible Petroleum Inventory set forth
in the definition of Borrowing Base as of the Closing Date.
8.2.8 Amend, modify or waive Section 11.2, Section 11.3, or any
other provision of this Agreement requiring ratable payments to or
disbursements by the Lenders.
No amendment of any provision of this Agreement relating to the Agent shall be
effective without the written consent of the Agent. The Agent may waive payment
of the fee required under Section 12.3.3 without obtaining the consent of any
other party to this Agreement. No amendment of any provision of this Agreement
relating to the Non-Ratable Lender or any Non-Ratable Loan shall be effective
without the written consent of the Non-Ratable Lender. No amendment of any
provision of this Agreement relating to an LC Issuer shall be effective without
the written consent of such LC Issuer. The limit set forth in Section 2.1.2 on
the aggregate amount of Collateral Protection Advances that may be outstanding
at any time shall not be increased without the written consent of the Agent and
the Lenders in the aggregate having 75% or more of the sum of (i) the Aggregate
Revolving Loan Commitment and (ii) the Aggregate Pre-Funded Letter of Credit
Commitment; provided, however, that if all of the Revolving Loan Commitments
have been terminated, the consent of Lenders holding 75% or more of the
Aggregate Outstanding Credit Exposure shall be required to approve any such
increase.
8.3. Preservation of Rights. No delay or omission of the Lenders, the LC
Issuers, or the Agent to exercise any right under the Loan Documents shall
impair such right or be construed to be a waiver of any Default or an
acquiescence therein, and the making of a Credit Extension notwithstanding the
existence of a Default or Unmatured Default or the inability of the Borrower to
satisfy the conditions precedent to such Credit Extension shall not constitute
any waiver or acquiescence. Any single or partial exercise of any such right
shall not preclude other or further exercise thereof or the exercise of any
other right, and no waiver, amendment or other variation of the terms,
conditions or provisions of the Loan Documents whatsoever shall be valid unless
in writing signed by, or by the Agent with the consent of, the requisite number
of Lenders required pursuant to Section 8.2, and then only to the extent in such
writing specifically set forth. All remedies contained in the Loan Documents or
by law afforded shall be cumulative and all shall be available to the Agent, the
LC Issuers, and the Lenders until all of the Secured Obligations have been paid
in full.
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ARTICLE IX
GENERAL PROVISIONS
9.1. Survival of Representations. All representations and warranties of
the Borrower contained in this Agreement shall survive the making of the Credit
Extensions herein contemplated.
9.2. Governmental Regulation. Anything contained in this Agreement to the
contrary notwithstanding, neither any LC Issuer nor any Lender shall be
obligated to extend credit to the Borrower in violation of any limitation or
prohibition provided by any applicable statute or regulation.
9.3. Headings. Section headings in the Loan Documents are for convenience
of reference only, and shall not govern the interpretation of any of the
provisions of the Loan Documents.
9.4. Entire Agreement. The Loan Documents embody the entire agreement and
understanding among the Borrower, the Agent, the LC Issuers, and the Lenders and
supersede all prior agreements and understandings among the Borrower, the Agent,
the LC Issuers, and the Lenders relating to the subject matter thereof other
than those contained in the fee letter described in Section 10.13 which shall
survive and remain in full force and effect during the term of this Agreement.
THIS WRITTEN AGREEMENT REPRESENTS THE FINAL AGREEMENT BETWEEN THE
PARTIES AND MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR,
CONTEMPORANEOUS, OR SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES. THERE
ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN THE PARTIES.
9.5. Several Obligations; Benefits of this Agreement. The respective
obligations of the Lenders hereunder are several and not joint and no Lender
shall be the partner or agent of any other (except to the extent to which the
Agent is authorized to act as such). The failure of any Lender to perform any of
its obligations hereunder shall not relieve any other Lender from any of its
obligations hereunder. This Agreement shall not be construed so as to confer any
right or benefit upon any Person other than the parties to this Agreement and
their respective successors and assigns, provided, however, that the parties
hereto expressly agree that the Arranger shall enjoy the benefits of the
provisions of Sections 9.6, 9.10 and 10.11 to the extent specifically set forth
therein and shall have the right to enforce such provisions on its own behalf
and in its own name to the same extent as if it were a party to this Agreement.
9.6. Expenses; Indemnification. (i) The Borrower shall reimburse the
Agent and the Arranger for any reasonable costs, internal charges and
out-of-pocket expenses (including outside attorneys' and paralegals' fees and
time charges of attorneys for the Agent and expenses of and fees for other
advisors and professionals engaged by the Agent or the Arranger) paid or
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incurred by the Agent or the Arranger in connection with the investigation,
preparation, negotiation, documentation, execution, delivery, syndication,
distribution (including, without limitation, via the internet), review,
amendment, modification and administration of the Loan Documents. The Borrower
also agrees to reimburse the Agent, the Arranger, the LC Issuers, and the
Lenders for any reasonable costs, internal charges and out-of-pocket expenses
(including outside attorneys' and paralegals' fees and time charges and expenses
of attorneys and paralegals for the Agent, the Arranger, the LC Issuers, and the
Lenders) paid or incurred by the Agent, the Arranger, any LC Issuer, or any
Lender in connection with the collection and enforcement of the Loan Documents.
In addition to expenses set forth above, the Borrower agrees to reimburse,
without duplication, the Agent and Bank of America, N.A., as co-collateral
agent, promptly after the Agent's or such co-collateral agent's request
therefor, for each audit, or other business analysis performed by or for the
benefit of the Holders of Secured Obligations in connection with this Agreement
or the other Loan Documents in an amount equal to the Agent's or such
co-collateral agent's then customary charges for each person employed to perform
such audit or analysis (which, solely with respect to charges for audits of
Collateral, shall not exceed a rate of $750 per day for the Agent or such
co-collateral agent, as applicable, performing such audit), plus all reasonable
costs and expenses (including without limitation, travel expenses) incurred by
the Agent or such co-collateral agent in the performance of such audit or
analysis.
(ii) The Borrower hereby further agrees to indemnify the Agent, the
Arranger, each LC Issuer, each Lender, and their respective affiliates, and each
of their directors, officers and employees against all losses, claims, damages,
penalties, judgments, liabilities and expenses (including, without limitation,
all expenses of litigation or preparation therefor whether or not the Agent, the
Arranger, any LC Issuer, any Lender or any affiliate is a party thereto, and all
attorneys' and paralegals' fees, time charges and expenses of attorneys and
paralegals of the party seeking indemnification, which attorneys and paralegals
may or may not be employees of such party seeking indemnification) which any of
them may pay or incur arising out of or relating to this Agreement, the other
Loan Documents, the transactions contemplated hereby or the direct or indirect
application or proposed application of the proceeds of any Credit Extension
hereunder except to the extent that they have resulted from the gross negligence
or willful misconduct of the party seeking indemnification. The obligations of
the Borrower under this Section 9.6 shall survive the termination of this
Agreement.
9.7. Numbers of Documents. All statements, notices, closing documents,
and requests hereunder shall be furnished to the Agent with sufficient
counterparts so that the Agent may furnish one to each of the Lenders, to the
extent that the Agent deems necessary.
9.8. Accounting. Except as provided to the contrary herein, all
accounting terms used in the calculation of any financial covenant or test shall
be interpreted and all accounting determinations hereunder in the calculation of
any financial covenant or test shall be made in accordance with Agreement
Accounting Principles. If any changes in US GAAP are hereafter required or
permitted and are adopted by the Borrower or any of its Subsidiaries with the
agreement of its independent certified public accountants and such changes
result in a change in the method of calculation of any of the financial
covenants, tests, restrictions or standards herein or in the related definitions
or terms used therein ("Accounting Changes"), the parties hereto agree, at the
Borrower's request, to enter into negotiations, in good faith, in order to amend
such provisions in a credit neutral manner so as to reflect equitably such
changes with the desired
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result that the criteria for evaluating the Borrower's and its Subsidiaries'
financial condition shall be the same after such changes as if such changes had
not been made; provided, however, until such provisions are amended in a manner
reasonably satisfactory to the Agent and the Required Lenders, no Accounting
Change shall be given effect in such calculations. In the event such amendment
is entered into, all references in this Agreement to Agreement Accounting
Principles shall mean US GAAP as of the date of such amendment. Notwithstanding
the foregoing, all financial statements to be delivered by the Borrower pursuant
to Section 6.1 shall be prepared in accordance with US GAAP in effect at such
time.
9.9. Severability of Provisions. Any provision in any Loan Document that
is held to be inoperative, unenforceable, or invalid in any jurisdiction shall,
as to that jurisdiction, be inoperative, unenforceable, or invalid without
affecting the remaining provisions in that jurisdiction or the operation,
enforceability, or validity of that provision in any other jurisdiction, and to
this end the provisions of all Loan Documents are declared to be severable.
9.10. Nonliability of Lenders. The relationship between the Borrower on
the one hand and the Lenders, the LC Issuers, and the Agent on the other hand
shall be solely that of borrower and lender. Neither the Agent, the Arranger,
any LC Issuer, nor any Lender shall have any fiduciary responsibilities to the
Borrower. Neither the Agent, the Arranger, any LC Issuer, nor any Lender
undertakes any responsibility to the Borrower to review or inform the Borrower
of any matter in connection with any phase of the Borrower's business or
operations. The Borrower agrees that neither the Agent, the Arranger, any LC
Issuer, nor any Lender shall have liability to the Borrower (whether sounding in
tort, contract or otherwise) for losses suffered by the Borrower in connection
with, arising out of, or in any way related to, the transactions contemplated
and the relationship established by the Loan Documents, or any act, omission or
event occurring in connection therewith, unless it is determined in a final
non-appealable judgment by a court of competent jurisdiction that such losses
resulted from the gross negligence or willful misconduct of the party from which
recovery is sought. Neither the Agent, the Arranger, any LC Issuer, nor any
Lender shall have any liability with respect to, and the Borrower hereby waives,
releases and agrees not to ▇▇▇ for, any special, indirect, consequential or
punitive damages suffered by the Borrower in connection with, arising out of, or
in any way related to the Loan Documents or the transactions contemplated
thereby.
9.11. Confidentiality. Each Lender agrees to hold any confidential
information which it may receive from the Borrower pursuant to this Agreement in
confidence, except for disclosure (i) to its Affiliates and to other Lenders and
their respective Affiliates, for use solely in connection with the transactions
contemplated hereby, (ii) to legal counsel, accountants, and other professional
advisors to such Lender or to a Transferee, in each case which have been
informed as to the confidential nature of such information, (iii) to regulatory
officials having jurisdiction over it, (iv) to any Person as required by law,
regulation, or legal process, (v) to any Person in connection with any legal
proceeding to which such Lender is a party, (vi) to such Lender's direct or
indirect contractual counterparties in swap agreements or to legal counsel,
accountants and other professional advisors to such counterparties, in each case
which have been informed as to the confidential nature of such information, and
(vii) permitted by Section 12.4.
9.12. Lenders Not Utilizing Plan Assets. Each Lender and Designated Lender
represents and warrants that none of the consideration used by such Lender or
Designated
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Lender to make its Loans constitutes for any purpose of ERISA or Section 4975 of
the Code assets of any "plan" as defined in Section 3(3) of ERISA or Section
4975 of the Code and the rights and interests of such Lender or Designated
Lender in and under the Loan Documents shall not constitute such "plan assets"
under ERISA.
9.13. Nonreliance. Each Lender hereby represents that it is not relying on
or looking to any margin stock (as defined in Regulation U) as collateral in the
extension or maintenance of the credit provided for herein.
9.14. Disclosure. The Borrower and each Lender, including each LC Issuer,
hereby acknowledge and agree that each Lender and/or its Affiliates from time to
time may hold investments in, make other loans to or have other relationships
with the Borrower and its Affiliates.
9.15. Performance of Obligations. The Borrower agrees that the Agent may,
but shall have no obligation to (i) at any time, pay or discharge taxes, liens,
security interests or other encumbrances levied or placed on or threatened
against any Collateral and (ii) after the occurrence and during the continuance
of a Default make any other payment or perform any act required of the Borrower
under any Loan Document or take any other action which the Agent in its
discretion deems necessary or desirable to protect or preserve the Collateral,
including, without limitation, any action to (x) effect any repairs or obtain
any insurance called for by the terms of any of the Loan Documents and to pay
all or any part of the premiums therefor and the costs thereof and (y) pay any
rents payable by the Borrower which are more than 30 days past due, or as to
which the landlord has given notice of termination, under any lease. The Agent
shall use its best efforts to give the Borrower notice of any action taken under
this Section 9.15 prior to the taking of such action or promptly thereafter
provided the failure to give such notice shall not affect the Borrower's
obligations in respect thereof. The Borrower agrees to pay the Agent, upon
demand, the principal amount of all funds advanced by the Agent under this
Section 9.15, together with interest thereon at the rate from time to time
applicable to Floating Rate Loans from the date of such advance until the
outstanding principal balance thereof is paid in full. If the Borrower fails to
make payment in respect of any such advance under this Section 9.15 within one
(1) Business Day after the date the Borrower receives written demand therefor
from the Agent, the Agent shall promptly notify each Lender and each Lender
agrees that it shall thereupon make available to the Agent, in Dollars in
immediately available funds, the amount equal to such Lender's Revolving Loan
Pro Rata Share of such advance. If such funds are not made available to the
Agent by such Lender within one (1) Business Day after the Agent's demand
therefor, the Agent will be entitled to recover any such amount from such Lender
together with interest thereon at the Federal Funds Effective Rate for each day
during the period commencing on the date of such demand and ending on the date
such amount is received. The failure of any Lender to make available to the
Agent its Revolving Loan Pro Rata Share of any such unreimbursed advance under
this Section 9.15 shall neither relieve any other Lender of its obligation
hereunder to make available to the Agent such other Lender's Revolving Loan Pro
Rata Share of such advance on the date such payment is to be made nor increase
the obligation of any other Lender to make such payment to the Agent. All
outstanding principal of, and interest on, advances made under this Section 9.15
shall constitute Obligations secured by the Collateral until paid in full by the
Borrower.
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9.16. Partial Guaranty Release. The Borrower has requested that the Agent
and the Lenders release Tesoro Technology Company, Tesoro Marine Services
Holding Company and Tesoro Marine Services, LLC (the "Release Entities") from
the Guaranty, the Security Agreement, and all other Collateral Documents to
which such Release Entities are subject. The Borrower represents, warrants and
covenants to the Agent and the Lenders that no Release Entity (i) has guaranteed
or secured, or shall guaranty or secure, the Other Senior Secured Debt or (ii)
owns or controls, or expects to own or control, Property with an aggregate value
in excess of $1,000,000 at any time; provided, however, that if any such Release
Entity shall own or control Property in excess of $1,000,000 at any time, the
Borrower shall cause such Release Entity to guaranty the Secured Obligations and
shall cause such Release Entity to secure its guaranty obligations pursuant to
the terms of the Guaranty, the Security Agreement, and such other Collateral
Documents as may be reasonably requested by the Agent. The Agent and the
Lenders, by their execution hereof, hereby release, as of the Closing Date, the
Release Entities from the Guaranty, the Security Agreement, and the other
Collateral Documents to which such Release Entities are subject. The Agent shall
record such instruments and documents, including, without limitation, UCC-3
termination statements, as are reasonably necessary, in the Agent's discretion,
to further evidence such release.
9.17. Subordination of Intercompany Indebtedness. The Borrower agrees that
any and all claims of the Borrower against any of its Subsidiaries that is a
guarantor with respect to any "Intercompany Indebtedness" (as hereinafter
defined), any endorser, obligor or any other guarantor of all or any part of the
Secured Obligations, or against any of its properties shall be subordinate and
subject in right of payment to the prior payment, in full and in cash, of all
Secured Obligations; provided that, and not in contravention of the foregoing,
so long as no Default has occurred and is continuing the Borrower may make loans
to and receive payments in the ordinary course with respect to such Intercompany
Indebtedness from each such guarantor to the extent permitted by the terms of
this Agreement and the other Loan Documents. Notwithstanding any right of the
Borrower to ask, demand, ▇▇▇ for, take or receive any payment from any
guarantor, all rights, liens and security interests of the Borrower, whether now
or hereafter arising and howsoever existing, in any assets of any guarantor
shall be and are subordinated to the rights of the Holders of Secured
Obligations in those assets. The Borrower shall not have any right to possession
of any such asset or to foreclose upon any such asset, whether by judicial
action or otherwise, unless and until all of the Secured Obligations (other than
contingent indemnity obligations) shall have been fully paid and
satisfied (in cash) and all financing arrangements pursuant to any Loan Document
among the Borrower and the Holders of Secured Obligations (or any affiliate
thereof) have been terminated. If all or any part of the assets of any
guarantor, or the proceeds thereof, are subject to any distribution, division or
application to the creditors of such guarantor, whether partial or complete,
voluntary or involuntary, and whether by reason of liquidation, bankruptcy,
arrangement, receivership, assignment for the benefit of creditors or any other
action or proceeding, or if the business of any such guarantor is dissolved or
if substantially all of the assets of any such guarantor are sold, then, and in
any such event (such events being herein referred to as an "Insolvency Event"),
any payment or distribution of any kind or character, either in cash, securities
or other property, which shall be payable or deliverable upon or with respect to
any Indebtedness of any guarantor to the Borrower ("Intercompany Indebtedness")
shall be paid or delivered directly to the Agent for application on any of the
Secured Obligations, due or to become due, until such Secured Obligations (other
than contingent indemnity obligations) shall have first been fully paid and
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satisfied (in cash). Should any payment, distribution, security or instrument or
proceeds thereof be received by the Borrower upon or with respect to the
Intercompany Indebtedness after an Insolvency Event prior to the satisfaction of
all of the Secured Obligations (other than contingent indemnity obligations) and
the termination of all financing arrangements pursuant to any Loan Document
among the Borrower and the Holders of Secured Obligations (and their
Affiliates), the Borrower shall receive and hold the same in trust, as trustee,
for the benefit of the Holders of Secured Obligations and shall forthwith
deliver the same to the Agent, for the benefit of such Persons, in precisely the
form received (except for the endorsement or assignment of the Borrower where
necessary), for application to any of the Secured Obligations, due or not due,
and, until so delivered, the same shall be held in trust by the Borrower as the
property of the Holder of Secured Obligations. If the Borrower fails to make any
such endorsement or assignment to the Agent, the Agent or any of its officers or
employees are irrevocably authorized to make the same. The Borrower agrees that
until the Secured Obligations (other than the contingent indemnity obligations)
have been paid in full (in cash) and satisfied and all financing arrangements
pursuant to any Loan Document among the Borrower and the Holders of the Secured
Obligations (and their Affiliates) have been terminated, the Borrower will not
assign or transfer to any Person (other than the Agent) any claim the Borrower
has or may have against any guarantor.
9.18. Certifications Regarding Indentures. The Borrower hereby certifies
to the Agent and the Lenders that, immediately prior to the effectiveness of the
Revolving Loan Commitments and the Pre-Funded Letter of Credit Commitments, and
immediately prior to the initial Credit Extension hereunder, the Borrower's
incurrence of Indebtedness under this Agreement and the other Loan Documents
does not violate (i) Section 4.09 of the Indenture, dated as of July 2, 1998, as
amended or modified from time to time, to which the Borrower and certain of its
Subsidiaries are subject and pursuant to which the Borrower issued certain 9%
Senior Subordinated Notes Due 2008, (ii) Section 4.09 of the Indenture, dated as
of November 6, 2001, as amended or modified from time to time, to which the
Borrower and certain of its Subsidiaries are subject and pursuant to which the
Borrower issued certain 9-5/8% Senior Subordinated Notes Due 2008, and (iii)
Section 4.09 of the Indenture, dated as of April 9, 2002, as amended or modified
from time to time, to which the Borrower is subject and pursuant to which the
Borrower issued certain 9-5/8% Senior Subordinated Notes Due 2012. The Borrower
further certifies to the Agent and the Lenders that both the Revolving Loan
Commitment component of this Agreement and the other Loan Documents constitute a
"Credit Facility" and a "Senior Credit Facility" under each of the foregoing
Indentures, and that neither the Aggregate Credit Linked Deposit nor the
Aggregate Pre-Funded Letter of Credit Commitment constitutes on the Closing Date
or at any other time a "Senior Credit Facility" under the indenture referenced
in clause (i) hereof, and shall not constitute such a "Senior Credit Facility"
until such indenture is appropriately amended or unless the "Fixed Charge
Coverage Ratio" under such indenture is equal to or greater than 2.0 to 1.0 on
the date on which the Aggregate Pre-Funded Letter of Credit Commitment goes into
effect and the effectiveness thereof is otherwise permitted under such
indenture. The Borrower further certifies that the Revolving Loan Commitments,
the Pre-Funded Letter of Credit Commitments, the Aggregate Credit Linked
Deposit, this Agreement, and the other Loan Documents collectively constitute
"Senior Debt" under each of the aforementioned indentures.
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9.19. Co-Agents. Other than as set forth in Section 9.6, no Lender
identified in this Agreement as the syndication agent, the documentation agent,
a co-collateral agent or any other Co-Agent shall have any right, power,
obligation, liability, responsibility, or duty under any Loan Document other
than those applicable to any Lender as such. Without limiting the foregoing, no
such Lender shall have or be deemed to have a fiduciary relationship with any
Lender.
ARTICLE X
THE AGENT
10.1. Appointment; Nature of Relationship. Bank One, NA is hereby
appointed by each of the Lenders as its contractual representative (herein
referred to as the "Agent") hereunder and under each other Loan Document, and
each of the Lenders irrevocably authorizes the Agent to act as the contractual
representative of such Lender with the rights and duties expressly set forth
herein and in the other Loan Documents, including, without limitation, the
Agent's agreement to bind itself and the Lenders to the Intercreditor Agreement
and to act on its behalf and on behalf of the Lenders thereunder. The Agent
agrees to act as such contractual representative upon the express conditions
contained in this Article X. Notwithstanding the use of the defined term
"Agent," it is expressly understood and agreed that the Agent shall not have any
fiduciary responsibilities to any of the Holders of Secured Obligations by
reason of this Agreement or any other Loan Document and that the Agent is merely
acting as the contractual representative of the Lenders with only those duties
as are expressly set forth in this Agreement and the other Loan Documents. In
its capacity as the Lenders' contractual representative, the Agent (i) does not
hereby assume any fiduciary duties to any of the Holders of Secured Obligations,
(ii) is a "representative" of the Holders of Secured Obligations within the
meaning of the term "secured party" as defined in the New York Uniform
Commercial Code and (iii) is acting as an independent contractor, the rights and
duties of which are limited to those expressly set forth in this Agreement and
the other Loan Documents. Each of the Lenders, for itself and on behalf of its
Affiliates as Holders of Secured Obligations, hereby agrees to assert no claim
against the Agent on any agency theory or any other theory of liability for
breach of fiduciary duty, all of which claims each Holder of Secured Obligations
hereby waives.
10.2. Powers. The Agent shall have and may exercise such powers under the
Loan Documents as are specifically delegated to the Agent by the terms of each
thereof, together with such powers as are reasonably incidental thereto. The
Agent shall have no implied duties or fiduciary duties to the Lenders, or any
obligation to the Lenders to take any action thereunder except any action
specifically provided by the Loan Documents to be taken by the Agent.
10.3. General Immunity. Neither the Agent nor any of its directors,
officers, agents or employees shall be liable to the Borrower, or any Lender or
Holder of Secured Obligations for any action taken or omitted to be taken by it
or them hereunder or under any other Loan Document or in connection herewith or
therewith except to the extent such action or inaction is determined in a final,
non-appealable judgment by a court of competent jurisdiction to have arisen from
the gross negligence or willful misconduct of such Person.
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10.4. No Responsibility for Loans, Recitals, etc. Neither the Agent nor
any of its directors, officers, agents or employees shall be responsible for or
have any duty to ascertain, inquire into, or verify (a) any statement, warranty
or representation made in connection with any Loan Document or any borrowing
hereunder; (b) the performance or observance of any of the covenants or
agreements of any obligor under any Loan Document, including, without
limitation, any agreement by an obligor to furnish information directly to each
Lender; (c) the satisfaction of any condition specified in Article IV, except
receipt of items required to be delivered solely to the Agent; (d) the existence
or possible existence of any Default or Unmatured Default; (e) the validity,
enforceability, effectiveness, sufficiency or genuineness of any Loan Document
or any other instrument or writing furnished in connection therewith; (f) the
value, sufficiency, creation, perfection or priority of any Lien in any
Collateral; or (g) the financial condition of the Borrower or any guarantor of
any of the Obligations or of any of the Borrower's or any such guarantor's
respective Subsidiaries. The Agent shall have no duty to disclose to the Lenders
information that is not required to be furnished by the Borrower to the Agent at
such time, but is voluntarily furnished by the Borrower to the Agent (either in
its capacity as Agent or in its individual capacity).
10.5. Action on Instructions of Lenders. The Agent shall in all cases be
fully protected in acting, or in refraining from acting, hereunder and under any
other Loan Document in accordance with written instructions signed by the
Required Lenders (or all of the Lenders in the event that and to the extent that
this Agreement expressly requires such), and such instructions and any action
taken or failure to act pursuant thereto shall be binding on all of the Lenders.
The Lenders hereby acknowledge that the Agent shall be under no duty to take any
discretionary action permitted to be taken by it pursuant to the provisions of
this Agreement or any other Loan Document unless it shall be requested in
writing to do so by the Required Lenders (or all of the Lenders in the event
that and to the extent that this Agreement expressly requires such). The Agent
shall be fully justified in failing or refusing to take any action hereunder and
under any other Loan Document unless it shall first be indemnified to its
satisfaction by the Lenders pro rata against any and all liability, cost and
expense that it may incur by reason of taking or continuing to take any such
action.
10.6. Employment of Agents and Counsel. The Agent may execute any of its
duties as Agent hereunder and under any other Loan Document by or through
employees, agents, and attorneys-in-fact and shall not be answerable to the
Lenders, except as to money or securities received by it or its authorized
agents, for the default or misconduct of any such agents or attorneys-in-fact
selected by it with reasonable care. The Agent shall be entitled to advice of
counsel concerning the contractual arrangement between the Agent and the Lenders
and all matters pertaining to the Agent's duties hereunder and under any other
Loan Document.
10.7. Reliance on Documents; Counsel. The Agent shall be entitled to rely
upon any Note, notice, consent, certificate, affidavit, letter, telegram,
statement, paper or document believed by it to be genuine and correct and to
have been signed or sent by the proper person or persons, and, in respect to
legal matters, upon the opinion of counsel selected by the Agent, which counsel
may be employees of the Agent.
10.8. Agent's Reimbursement and Indemnification. The Lenders agree to
reimburse and indemnify the Agent ratably in proportion to the Lenders' Pro Rata
Shares of the Aggregate
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Revolving Loan Commitment and the Aggregate Credit Linked Deposit (or, if the
Aggregate Revolving Loan Commitment has been terminated, of the Aggregate
Outstanding Revolving Loan Credit Exposure) (i) for any amounts not reimbursed
by the Borrower for which the Agent is entitled to reimbursement by the Borrower
under the Loan Documents, (ii) for any other expenses incurred by the Agent on
behalf of the Lenders, in connection with the preparation, execution, delivery,
administration and enforcement of the Loan Documents (including, without
limitation, for any expenses incurred by the Agent in connection with any
dispute between the Agent and any Lender or between two or more of the Lenders)
and (iii) for any liabilities, obligations, losses, damages, penalties, actions,
judgments, suits, costs, expenses or disbursements of any kind and nature
whatsoever which may be imposed on, incurred by or asserted against the Agent in
any way relating to or arising out of the Loan Documents or any other document
delivered in connection therewith or the transactions contemplated thereby
(including, without limitation, for any such amounts incurred by or asserted
against the Agent in connection with any dispute between the Agent and any
Lender or between two or more of the Lenders), or the enforcement of any of the
terms of the Loan Documents or of any such other documents, provided that (i) no
Lender shall be liable for any of the foregoing to the extent any of the
foregoing is found in a final, non-appealable judgment by a court of competent
jurisdiction to have resulted from the gross negligence or willful misconduct of
the Agent and (ii) any indemnification required pursuant to Section 3.5(vii)
shall, notwithstanding the provisions of this Section 10.8, be paid by the
relevant Lender in accordance with the provisions thereof. The obligations of
the Lenders under this Section 10.8 shall survive payment of the Secured
Obligations and termination of this Agreement.
10.9. Notice of Default. The Agent shall not be deemed to have knowledge
or notice of the occurrence of any Default or Unmatured Default hereunder unless
the Agent has received written notice from a Lender or the Borrower referring to
this Agreement describing such Default or Unmatured Default and stating that
such notice is a "notice of default". In the event that the Agent receives such
a notice, the Agent shall give prompt notice thereof to the Lenders.
10.10. Rights as a Lender. In the event the Agent is a Lender, the Agent
shall have the same rights and powers hereunder and under any other Loan
Document with respect to its Revolving Loan Commitment and its Credit Extensions
as any Lender and may exercise the same as though it were not the Agent, and the
term "Lender" or "Lenders" shall, at any time when the Agent is a Lender, unless
the context otherwise indicates, include the Agent in its individual capacity.
The Agent and its Affiliates may accept deposits from, lend money to, and
generally engage in any kind of trust, debt, equity or other transaction, in
addition to those contemplated by this Agreement or any other Loan Document,
with the Borrower or any of its Subsidiaries in which the Borrower or such
Subsidiary is not restricted hereby from engaging with any other Person. The
Agent, in its individual capacity, is not obligated to remain a Lender.
10.11. Lender Credit Decision. Each Lender acknowledges that it has,
independently and without reliance upon the Agent, the Arranger or any other
Lender and based on the financial statements prepared by the Borrower and such
other documents and information as it has deemed appropriate, made its own
credit analysis and decision to enter into this Agreement and the other Loan
Documents. Each Lender also acknowledges that it will, independently and without
reliance upon the Agent, the Arranger or any other Lender and based on such
documents
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and information as it shall deem appropriate at the time, continue to make its
own credit decisions in taking or not taking action under this Agreement and the
other Loan Documents.
10.12. Successor Agent. The Agent may resign at any time by giving written
notice thereof to the Lenders and the Borrower, such resignation to be effective
upon the appointment of a successor Agent or, if no successor Agent has been
appointed, forty-five days after the retiring Agent gives notice of its
intention to resign. The Agent may be removed at any time with or without cause
by written notice received by the Agent from the Required Lenders, such removal
to be effective on the date specified by the Required Lenders. Upon any such
resignation or removal, the Required Lenders shall have the right to appoint, on
behalf of the Borrower and the Lenders, a successor Agent. If no successor Agent
shall have been so appointed by the Required Lenders within thirty days after
the resigning Agent's giving notice of its intention to resign, then the
resigning Agent may appoint, on behalf of the Borrower and the Lenders, a
successor Agent. Notwithstanding the previous sentence, the Agent may at any
time without the consent of the Borrower or any Lender, appoint any of its
Affiliates which is a commercial bank as a successor Agent hereunder. If the
Agent has resigned or been removed and no successor Agent has been appointed,
the Lenders may perform all the duties of the Agent hereunder and the Borrower
shall make all payments in respect of the Obligations to the applicable Lender
and for all other purposes shall deal directly with the Lenders. No successor
Agent shall be deemed to be appointed hereunder until such successor Agent has
accepted the appointment. Any such successor Agent shall be a commercial bank
having capital and retained earnings of at least $100,000,000. Upon the
acceptance of any appointment as Agent hereunder by a successor Agent, such
successor Agent shall thereupon succeed to and become vested with all the
rights, powers, privileges and duties of the resigning or removed Agent. Upon
the effectiveness of the resignation or removal of the Agent, the resigning or
removed Agent shall be discharged from its duties and obligations hereunder and
under the Loan Documents. After the effectiveness of the resignation or removal
of an Agent, the provisions of this Article X shall continue in effect for the
benefit of such Agent in respect of any actions taken or omitted to be taken by
it while it was acting as the Agent hereunder and under the other Loan
Documents. In the event that there is a successor to the Agent by merger, or the
Agent assigns its duties and obligations to an Affiliate pursuant to this
Section 10.12, then the term "Prime Rate" as used in this Agreement shall mean
the prime rate, base rate or other analogous rate of the new Agent.
10.13. Agent and Arranger Fees. The Borrower agrees to pay to the Agent
and the Arranger, for their respective accounts, the fees agreed to by the
Borrower, the Agent and the Arranger pursuant to that certain letter agreement
dated May 25, 2004, or as otherwise agreed from time to time.
10.14. Delegation to Affiliates. The Borrower and the Lenders agree that
the Agent may delegate any of its duties under this Agreement to any of its
Affiliates. Any such Affiliate (and such Affiliate's directors, officers, agents
and employees) which performs duties in connection with this Agreement shall be
entitled to the same benefits of the indemnification, waiver and other
protective provisions to which the Agent is entitled under Articles IX and X.
10.15. Collateral Documents. (a) Each Lender authorizes the Agent to enter
into each of the Collateral Documents to which it is a party and to take all
action contemplated by such documents. Each Lender agrees that no Holder of
Secured Obligations (other than the Agent)
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shall have the right individually to seek to realize upon the security granted
by any Collateral Document, it being understood and agreed that such rights and
remedies may be exercised solely by the Agent for the benefit of the Holders of
Secured Obligations upon the terms of the Collateral Documents.
(b) In the event that any Collateral is hereafter pledged by any
Person as collateral security for the Secured Obligations, the Agent is hereby
authorized to execute and deliver on behalf of the Holders of Secured
Obligations any Loan Documents necessary or appropriate to grant and perfect a
Lien on such Collateral in favor of the Agent on behalf of the Holders of
Secured Obligations.
(c) The Lenders hereby authorize the Agent, at its option and in
its discretion, to release any Lien granted to or held by the Agent upon any
Collateral (i) upon termination of the Aggregate Revolving Loan Commitment and
payment and satisfaction of all of the Obligations (other than contingent
indemnity obligations and Rate Management Obligations) at any time arising under
or in respect of this Agreement or the Loan Documents or the transactions
contemplated hereby or thereby; (ii) as permitted by, but only in accordance
with, the terms of the applicable Loan Document; or (iii) if approved,
authorized or ratified in writing by the Required Lenders, unless such release
is required to be approved by all of the Lenders hereunder. Upon request by the
Agent at any time, the Lenders will confirm in writing the Agent's authority to
release particular types or items of Collateral pursuant to this Section 10.15.
(d) Upon any sale or transfer of assets constituting Collateral
which is permitted pursuant to the terms of any Loan Document, or consented to
in writing by the Required Lenders or all of the Lenders, as applicable, and
upon at least five Business Days' prior written request by the Borrower to the
Agent, the Agent shall (and is hereby irrevocably authorized by the Lenders to)
execute such documents as may be necessary to evidence the release of the Liens
granted to the Agent for the benefit of the Holders of Secured Obligations
herein or pursuant hereto upon the Collateral that was sold or transferred;
provided, however, that (i) the Agent shall not be required to execute any such
document on terms which, in the Agent's opinion, would expose the Agent to
liability or create any obligation or entail any consequence other than the
release of such Liens without recourse or warranty, and (ii) such release shall
not in any manner discharge, affect or impair the Secured Obligations or any
Liens upon (or obligations of the Borrower or any Subsidiary Guarantor in
respect of) all interests retained by the Borrower or any Subsidiary Guarantor,
including, without limitation, the proceeds of the sale, all of which shall
continue to constitute part of the Collateral.
10.16. Intercreditor Agreement.
10.16.1 The Intercreditor Agreement sets forth certain relative
rights, as holders of Liens, of the Agent on behalf of the Holders of
Secured Obligations and the Multiparty Collateral Agent on behalf of the
Senior Noteholders and the Senior Term Loan Holders. Each of the Lenders
has received a copy of the Intercreditor Agreement attached hereto as
Exhibit I and each such Person (including, without limitation, those
Persons that become Lenders subject hereto pursuant to an Assignment
Agreement) agrees to be bound by the terms and conditions of such attached
Intercreditor Agreement. The future consent of the Lenders shall not be
required in order for the Agent to enter into any
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Intercreditor Agreement described in clause (y) of the definition thereof,
and the Lenders hereby authorize the Agent to enter into such
Intercreditor Agreement. The Lenders authorize the Agent to deliver
written notice to the Multiparty Collateral Agent, the Senior Note
Trustee, the Senior Term Loan Agreement Agent, the Senior Noteholders and
the Senior Term Loan Holders that this Agreement, the other Loan
Documents, and the credit facilities evidenced hereby, constitute a
"Qualified Credit Facility" as defined on the Closing Date in the Senior
Note Indenture and Senior Term Loan Agreement. The Agent shall require the
written agreement of the Multiparty Collateral Agent, on behalf of itself,
the Senior Note Trustee, the Senior Noteholders, the Senior Term Loan
Agreement Agent, and the Senior Term Loan Holders, to be bound by the
Intercreditor Agreement. Notwithstanding the foregoing, nothing in the
Intercreditor Agreement will:
(a) impair, as between (1) the Borrower and the Subsidiary
Guarantors, and (2) the Agent, the Lenders, the LC Issuers, the
obligations of the Borrower or any Subsidiary Guarantor, which are
absolute and unconditional, to pay principal, interest, fees and expenses
hereunder in accordance with the terms hereof or to perform any other
obligation of the Borrower or such Subsidiary Guarantor under the Loan
Documents;
(b) affect the relative rights of the Holders of Secured
Obligations, the Senior Noteholders or the Senior Term Loan Holders and
other creditors of the Borrower or any of its Subsidiaries;
(c) restrict the right of any Holder of Secured Obligations,
Senior Noteholder or Senior Term Loan Holder to ▇▇▇ for payments that are
then due and owing;
(d) prevent the Agent, the Holders of Secured Obligations, the
Multiparty Collateral Agent, the Senior Note Trustee, the Senior Term Loan
Agreement Agent, the Senior Noteholders or the Senior Term Loan Holders,
from exercising against the Borrower or any Subsidiary Guarantor any of
its other available remedies upon a Default or Unmatured Default or a
"default" or "event of default" under the Senior Notes or the Senior Term
Loan Agreement (or any comparable event which would permit the
acceleration of the repayment of the Indebtedness held by such Persons or
which would otherwise allow such Persons to exercise rights and remedies
against the Borrower or any Subsidiary Guarantor); or
(e) restrict the right of the Agent, the Holders of Secured
Obligations, the Multiparty Collateral Agent, the Senior Note Trustee, the
Senior Term Loan Agreement Agent, the Senior Noteholders or the Senior
Term Loan Holders to file and prosecute a petition seeking an order for
relief in an involuntary bankruptcy case as to the Borrower or any
Subsidiary Guarantor or otherwise to commence, or seek relief commencing,
any insolvency or liquidation proceeding involuntarily against the
Borrower or any Subsidiary Guarantor or to assert or enforce any claim,
Lien, right or remedy in any voluntary or involuntary bankruptcy case or
insolvency or liquidation proceeding.
10.16.2 The Agent and the Lenders agree that, until the Senior Notes
and the Senior Term Loans are repaid and the Multiparty Collateral Agent's
Lien upon certain of the Borrower's and its Subsidiaries' Property is
released as a result of such repayment,
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the Agent, on behalf of the Lenders, shall be bound by and shall perform
each of its obligations set forth in the Intercreditor Agreement. The
Agent and the Lenders further agree that neither the Lenders nor the Agent
shall accept, enforce, claim or retain any benefit of any guaranty from or
by any Pipeline Subsidiary, any Lien upon any Property of any Pipeline
Subsidiary as Collateral for the Secured Obligations, or any consensual
Lien upon any equities of any Subsidiary of the Borrower. The Multiparty
Collateral Agent, the Senior Note Trustee, the Senior Term Loan Agreement
Agent, the Senior Term Loan Holders, and the Senior Noteholders shall be
deemed to be third party beneficiaries of this Section 10.16.2.
ARTICLE XI
SETOFF; RATABLE PAYMENTS
11.1. Setoff. In addition to, and without limitation of, any rights of the
Lenders under applicable law, if the Borrower becomes insolvent, however
evidenced, or any Default occurs, any and all deposits (including all account
balances, whether provisional or final and whether or not collected or
available) and any other Indebtedness at any time held or owing by any Lender or
any Affiliate of any Lender to or for the credit or account of the Borrower may
be offset and applied toward the payment of the Secured Obligations owing to
such Lender, whether or not the Secured Obligations, or any part thereof, shall
then be due.
11.2. Ratable Payments. If any Lender, whether by setoff or otherwise, has
payment made to it upon its Outstanding Credit Exposure (other than payments
received pursuant to Section 3.1, 3.2, 3.4 or 3.5) in a greater proportion than
that received by any other Lender, such Lender agrees, promptly upon demand, to
purchase a participation in the Aggregate Outstanding Credit Exposure held by
the other Lenders so that after such purchase each Lender will hold its Pro Rata
Share of the Aggregate Outstanding Credit Exposure. If any Lender, whether in
connection with setoff or amounts which might be subject to setoff or otherwise,
receives collateral or other protection for its Obligations or such amounts
which may be subject to setoff, such Lender agrees, promptly upon demand, to
take such action necessary such that all Lenders share in the benefits of such
collateral ratably in proportion to their respective Pro Rata Shares of the
Aggregate Outstanding Credit Exposure. In case any such payment is disturbed by
legal process, or otherwise, appropriate further adjustments shall be made.
11.3. Application of Payments. Principal and interest payments shall be
apportioned ratably among the Lenders (according to the unpaid principal balance
of the Loans to which such payments relate held by each Lender) and payments of
the fees shall, as applicable, be apportioned ratably among the Lenders, except
for fees payable solely to the Agent or any LC Issuer and except as provided in
the fee letter referenced in Section 10.13. Subject to the provisions of Section
2.2 governing the application of mandatory prepayments, all payments shall be
remitted to the Agent and all such payments not relating to principal or
interest of specific Loans, or not constituting payment of specific fees, and
all proceeds of any Collateral received by the Agent following acceleration of
the maturity of the Obligations pursuant to Section 8.1, shall be applied,
ratably, subject to the provisions of this Agreement, first, to pay any fees,
indemnities, or expense reimbursements including amounts then due to the Agent
from the Borrower, second, to pay any fees or expense reimbursements then due to
the Lenders from
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the Borrower, third, to pay ratably interest due in respect of the Revolving
Loans, including Non-Ratable Loans and Collateral Protection Advances, and fees
due in respect of the Aggregate Credit Linked Deposit, fourth, to pay or prepay
ratably the principal amount of the Collateral Protection Advances, fifth, to
pay or prepay ratably the principal amount of the Non-Ratable Loans and the
Revolving Loans, unpaid Reimbursement Obligations in respect of Facility LCs,
unpaid reimbursement obligations resulting from withdrawals from the Pre-Funded
Letter of Credit Account, and an amount to the Agent equal to one hundred ten
percent (110%) of the aggregate undrawn face amount of all outstanding Facility
LCs to be held as cash collateral for such Obligations, sixth, to pay any
amounts owing with respect to Bank Products, and seventh, to the payment of any
other Secured Obligation due to the Agent or any Lender by the Borrower.
Notwithstanding anything to the contrary contained in this Agreement,
unless so directed by the Borrower, or unless a Default is in existence, neither
the Agent nor any Lender shall apply any payment which it receives to any
Eurodollar Loan, except (a) on the expiration date of the Interest Period
applicable to any such Eurodollar Loan, or (b) in the event, and only to the
extent, that there are no outstanding Floating Rate Loans and, in any event, the
Borrower shall pay the breakage losses with respect to Eurodollar Loans in
accordance with Section 3.4. The Agent and the Required Lenders shall have the
continuing and exclusive right to apply and reverse and reapply any and all such
proceeds and payments to any portion of the Secured Obligations. Unless
otherwise required by the terms of this Agreement, all principal payments in
respect of Loans (other than Non-Ratable Loans and Collateral Protection
Advances) shall be applied first to repay outstanding Floating Rate Loans, and
then to repay outstanding Eurodollar Loans with those Eurodollar Loans which
have earlier expiring Interest Periods being repaid prior to those which have
later expiring Interest Periods.
ARTICLE XII
BENEFIT OF AGREEMENT; ASSIGNMENTS; PARTICIPATIONS
12.1. Successors and Assigns; Designated Lenders.
12.1.1 Successors and Assigns. The terms and provisions of the Loan
Documents shall be binding upon and inure to the benefit of the Borrower,
the Agent and the Lenders and their respective successors and assigns
permitted hereby, except that (i) the Borrower shall not have the right to
assign its rights or obligations under the Loan Documents without the
prior written consent of each Lender, (ii) any assignment by any Lender
must be made in compliance with Section 12.3, and (iii) any transfer by
Participants must be made in compliance with Section 12.2. Any attempted
assignment or transfer by any party not made in compliance with this
Section 12.1 shall be null and void, unless such attempted assignment or
transfer is treated as a participation in accordance with Section 12.3.2.
The parties to this Agreement acknowledge that clause (ii) of this Section
12.1 relates only to absolute assignments and this Section 12.1 does not
prohibit assignments creating security interests, including, without
limitation, (x) any pledge or assignment by any Lender of all or any
portion of its rights under this Agreement and any Note to a Federal
Reserve Bank, (y) in the case of a Lender which is a Fund, any pledge or
assignment of all or any portion of its rights under this Agreement
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and any Note to its trustee in support of its obligations to its trustee
or (z) any pledge or assignment by any Lender of all or any portion of its
rights under this Agreement and any Note to direct or indirect contractual
counterparties in swap agreements relating to the Loans; provided,
however, that no such pledge or assignment creating a security interest
shall release the transferor Lender from its obligations hereunder unless
and until the parties thereto have complied with the provisions of Section
12.3. The Agent may treat the Person which made any Loan or which holds
any Note as the owner thereof for all purposes hereof unless and until
such Person complies with Section 12.3; provided, however, that the Agent
may in its discretion (but shall not be required to) follow instructions
from the Person which made any Loan or which holds any Note to direct
payments relating to such Loan or Note to another Person. Any assignee of
the rights to any Loan or any Note agrees by acceptance of such assignment
to be bound by all the terms and provisions of the Loan Documents. Any
request, authority or consent of any Person, who at the time of making
such request or giving such authority or consent is the owner of the
rights to any Loan (whether or not a Note has been issued in evidence
thereof), shall be conclusive and binding on any subsequent holder or
assignee of the rights to such Loan.
12.1.2 Designated Lenders.
(i) Subject to the terms and conditions set forth in this Section
12.1.2, any Lender may from time to time elect to designate an
Eligible Designee to provide all or any part of the Loans to be made
by such Lender pursuant to this Agreement; provided that the
designation of an Eligible Designee by any Lender for purposes of
this Section 12.1.2 shall be subject to the approval of the Agent
(which consent shall not be unreasonably withheld or delayed). Upon
the execution by the parties to each such designation of an
agreement in the form of Exhibit F hereto (a "Designation
Agreement") and the acceptance thereof by the Agent, the Eligible
Designee shall become a Designated Lender for purposes of this
Agreement. The Designating Lender shall thereafter have the right to
permit the Designated Lender to provide all or a portion of the
Loans to be made by the Designating Lender pursuant to the terms of
this Agreement and the making of the Loans or portion thereof shall
satisfy the obligations of the Designating Lender to the same
extent, and as if, such Loan was made by the Designating Lender. As
to any Loan made by it, each Designated Lender shall have all the
rights a Lender making such Loan would have under this Agreement and
otherwise; provided, (x) that all voting rights under this Agreement
shall be exercised solely by the Designating Lender, (y) each
Designating Lender shall remain solely responsible to the other
parties hereto for its obligations under this Agreement, including
the obligations of a Lender in respect of Loans made by its
Designated Lender and (z) no Designated Lender shall be entitled to
reimbursement under Article III hereof for any amount which would
exceed the amount that would have been payable by the Borrower to
the Lender from which the Designated Lender obtained any interests
hereunder. No additional Notes shall be required with respect to
Loans provided by a Designated Lender; provided, however, to the
extent any Designated Lender shall advance funds, the Designating
Lender shall be deemed to hold the Notes in its possession as an
agent for such Designated Lender to the extent of the Loan
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funded by such Designated Lender. Such Designating Lender shall act
as administrative agent for its Designated Lender and give and
receive notices and communications hereunder. Any payments for the
account of any Designated Lender shall be paid to its Designating
Lender as administrative agent for such Designated Lender and
neither the Borrower nor the Agent shall be responsible for any
Designating Lender's application of such payments. In addition, any
Designated Lender may (1) with notice to, but without the consent of
the Borrower or the Agent, assign all or portions of its interests
in any Loans to its Designating Lender or to any financial
institution consented to by the Agent providing liquidity and/or
credit facilities to or for the account of such Designated Lender
and (2) subject to advising any such Person that such information is
to be treated as confidential in accordance with Section 9.11,
disclose on a confidential basis any non-public information relating
to its Loans to any rating agency, commercial paper dealer or
provider of any guarantee, surety or credit or liquidity enhancement
to such Designated Lender.
(ii) Each party to this Agreement hereby agrees that it shall not
institute against, or join any other Person in instituting against,
any Designated Lender any bankruptcy, reorganization, arrangement,
insolvency or liquidation proceeding or other proceedings under any
federal or state bankruptcy or similar law for one year and a day
after the payment in full of all outstanding senior indebtedness of
any Designated Lender; provided that the Designating Lender for each
Designated Lender hereby agrees to indemnify, save and hold harmless
each other party hereto for any loss, cost, damage and expense
arising out of its inability to institute any such proceeding
against such Designated Lender. This Section 12.1.2 shall survive
the termination of this Agreement.
12.2. Participations.
12.2.1 Permitted Participants; Effect. Any Lender may at any time
sell to one or more banks or other entities ("Participants") participating
interests in any Outstanding Credit Exposure of such Lender, any Note held
by such Lender, any Revolving Loan Commitment of such Lender or any other
interest of such Lender under the Loan Documents. In the event of any such
sale by a Lender of participating interests to a Participant, such
Lender's obligations under the Loan Documents shall remain unchanged, such
Lender shall remain solely responsible to the other parties hereto for the
performance of such obligations, such Lender shall remain the owner of its
Outstanding Credit Exposure and the holder of any Note issued to it in
evidence thereof for all purposes under the Loan Documents, all amounts
payable by the Borrower under this Agreement shall be determined as if
such Lender had not sold such participating interests, and the Borrower
and the Agent shall continue to deal solely and directly with such Lender
in connection with such Lender's rights and obligations under the Loan
Documents.
12.2.2 Voting Rights. Each Lender shall retain the sole right to
approve, without the consent of any Participant, any amendment,
modification or waiver of any provision of the Loan Documents other than
any amendment, modification or waiver with respect
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to any Credit Extension or Revolving Loan Commitment in which such
Participant has an interest which would require consent of all of the
Lenders pursuant to the terms of Section 8.2.
12.2.3 Benefit of Certain Provisions. The Borrower agrees that each
Participant shall be deemed to have the right of setoff provided in
Section 11.1 in respect of its participating interest in amounts owing
under the Loan Documents to the same extent as if the amount of its
participating interest were owing directly to it as a Lender under the
Loan Documents, provided that each Lender shall retain the right of setoff
provided in Section 11.1 with respect to the amount of participating
interests sold to each Participant. The Lenders agree to share with each
Participant, and each Participant, by exercising the right of setoff
provided in Section 11.1, agrees to share with each Lender, any amount
received pursuant to the exercise of its right of setoff, such amounts to
be shared in accordance with Section 11.2 as if each Participant were a
Lender. The Borrower further agrees that each Participant shall be
entitled to the benefits of Sections 3.1, 3.2, 3.4 and 3.5 to the same
extent as if it were a Lender and had acquired its interest by assignment
pursuant to Section 12.3, provided that (i) a Participant shall not be
entitled to receive any greater payment under Section 3.1, 3.2 or 3.5 than
the Lender who sold the participating interest to such Participant would
have received had it retained such interest for its own account, unless
the sale of such interest to such Participant is made with the prior
written consent of the Borrower, and (ii) any Participant not incorporated
under the laws of the United States of America or any State thereof agrees
to comply with the provisions of Section 3.5 to the same extent as if it
were a Lender.
12.3. Assignments.
12.3.1 Permitted Assignments. Any Lender may at any time assign to
one or more banks or other entities ("Purchasers") all or any part of its
rights and obligations under the Loan Documents. Such assignment shall be
evidenced by an agreement substantially in the form of Exhibit C or in
such other form as may be agreed to by the parties thereto (each such
agreement, an "Assignment Agreement"). Each such assignment with respect
to a Purchaser which is not a Lender or an Affiliate of a Lender or an
Approved Fund shall, unless otherwise consented to in writing by the
Borrower and the Agent, either be in an amount equal to the entire
applicable Outstanding Credit Exposure of the assigning Lender or (unless
each of the Borrower and the Agent otherwise consents) be in an aggregate
amount not less than (x) $10,000,000 with respect to Revolving Loans and
(y) $1,000,000 with respect to Pre-Funded Letter of Credit Commitments and
related Credit Linked Deposits. The amount of the assignment shall be
based on the Outstanding Credit Exposure subject to the assignment,
determined as of the date of such assignment or as of the "Trade Date," if
the "Trade Date" is specified in the Assignment Agreement.
12.3.2 Consents. The consent of the Borrower shall be required prior
to an assignment becoming effective unless the Purchaser is a Lender, an
Affiliate of a Lender or an Approved Fund, provided that the consent of
the Borrower shall not be required if (i) a Default has occurred and is
continuing or (ii) such assignment is in connection with the physical
settlement of any Lender's obligations to direct or indirect contractual
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counterparties in swap agreements relating to the Loans; provided, that
the assignment without the Borrower's consent pursuant to clause (ii)
shall not increase the Borrower's liability under Section 3.5. The consent
of the Agent shall be required prior to an assignment becoming effective
unless the Purchaser is a Lender, an Affiliate of a Lender or an Approved
Fund. Any consent required under this Section 12.3.2 shall not be
unreasonably withheld or delayed.
12.3.3 Effect; Effective Date. Upon (i) delivery to the Agent of an
Assignment Agreement, together with any consents required by Sections
12.3.1 and 12.3.2, and (ii) payment of a $3,500 fee to the Agent for
processing such assignment (unless such fee is waived by the Agent or
unless such assignment is made to such assigning Lender's Affiliate or an
Approved Fund), such assignment shall become effective on the effective
date specified in such assignment. The Assignment Agreement shall contain
a representation and warranty by the Purchaser to the effect that the
assignment evidenced thereby will not result in a non-exempt "prohibited
transaction" under Section 406 of ERISA. On and after the effective date
of such assignment, such Purchaser shall for all purposes be a Lender
party to this Agreement and any other Loan Document executed by or on
behalf of the Lenders and shall have all the rights, benefits and
obligations of a Lender under the Loan Documents, to the same extent as if
it were an original party thereto, and the transferor Lender shall be
released with respect to the Outstanding Credit Exposure assigned to such
Purchaser without any further consent or action by the Borrower, the
Lenders or the Agent. In the case of an assignment covering all of the
assigning Lender's rights, benefits and obligations under this Agreement,
such Lender shall cease to be a Lender hereunder but shall continue to be
entitled to the benefits of, and subject to, those provisions of this
Agreement and the other Loan Documents which survive payment of the
Obligations and termination of the Loan Documents. Any assignment or
transfer by a Lender of rights or obligations under this Agreement that
does not comply with this Section 12.3 shall be treated for purposes of
this Agreement as a sale by such Lender of a participation in such rights
and obligations in accordance with Section 12.2. Upon the consummation of
any assignment to a Purchaser pursuant to this Section 12.3.3, the
transferor Lender, the Agent and the Borrower shall, if the transferor
Lender or the Purchaser desires that its Loans be evidenced by Notes, make
appropriate arrangements so that, upon cancellation and surrender to the
Borrower of the Notes (if any) held by the transferor Lender, new Notes
or, as appropriate, replacement Notes are issued to such transferor
Lender, if applicable, and new Notes or, as appropriate, replacement
Notes, are issued to such Purchaser, in each case in principal amounts
reflecting their Revolving Loan Commitments (or, if the Termination Date
has occurred, their respective Outstanding Credit Exposure), as adjusted
pursuant to such assignment.
12.3.4 Register. The Agent, acting solely for this purpose as an
agent of the Borrower (and the Borrower hereby designates the Agent to act
in such capacity), shall maintain at one of its offices in Chicago,
Illinois a copy of each Assignment and Assumption delivered to it and a
register (the "Register") for the recordation of the names and addresses
of the Lenders, and the Revolving Loan Commitments of, and principal
amounts of and interest on the Loans owing to, each Lender pursuant to the
terms hereof from time to time and whether such Lender is an original
Lender or assignee of another Lender pursuant to an assignment under this
Section 13.3. The entries in the Register
102
shall be conclusive, and the Borrower, the Agent and the Lenders may treat
each Person whose name is recorded in the Register pursuant to the terms
hereof as a Lender hereunder for all purposes of this Agreement,
notwithstanding notice to the contrary. The Register shall be available
for inspection by the Borrower and any Lender, at any reasonable time and
from time to time upon reasonable prior notice.
12.4. Dissemination of Information. The Borrower authorizes each Lender to
disclose to any Participant or Purchaser or any other Person acquiring an
interest in the Loan Documents by operation of law (each a "Transferee") and any
prospective Transferee any and all information in such Lender's possession
concerning the creditworthiness of the Borrower and its Subsidiaries; provided
that each Transferee and prospective Transferee agrees to be bound by Section
9.11 of this Agreement.
12.5. Tax Certifications. If any interest in any Loan Document is
transferred to any Transferee which is not incorporated under the laws of the
United States or any State thereof, the transferor Lender shall cause such
Transferee, concurrently with the effectiveness of such transfer, to comply with
the provisions of Section 3.5(iv).
ARTICLE XIII
NOTICES
13.1. Notices. Except as otherwise permitted by Section 2.13 with respect
to borrowing notices, all notices, requests and other communications to any
party hereunder shall be in writing (including electronic transmission,
facsimile transmission or similar writing) and shall be given to such party: (x)
in the case of the Borrower, the Lenders, the LC Issuers, or the Agent, at its
address or facsimile number set forth on the signature pages hereof or, (y) in
the case of any party, at such other address or facsimile number as such party
may hereafter specify for the purpose by notice to the Agent and the Borrower in
accordance with the provisions of this Section 13.1. Each such notice, request
or other communication shall be effective (i) if given by facsimile
transmission, when transmitted to the facsimile number specified in this Section
and confirmation of receipt is received, (ii) if given by mail, 72 hours after
such communication is deposited in the mails with first class postage prepaid,
addressed as aforesaid, or (iii) if given by any other means, when delivered
(or, in the case of electronic transmission, received) at the address specified
in this Section; provided that notices to the Agent under Article II shall not
be effective until received.
13.2. Change of Address. The Borrower, the Agent, any LC Issuer, and any
Lender may each change the address for service of notice upon it by a notice in
writing to the other parties hereto.
ARTICLE XIV
COUNTERPARTS
This Agreement may be executed in any number of counterparts, all of which
taken together shall constitute one agreement, and any of the parties hereto may
execute this
103
Agreement by signing any such counterpart. This Agreement shall be effective
when it has been executed by the Borrower, the Agent, the initial LC Issuer, and
the Lenders and each party has notified the Agent by facsimile transmission or
telephone that it has taken such action.
ARTICLE XV
CHOICE OF LAW; CONSENT TO JURISDICTION; WAIVER OF JURY TRIAL
15.1 CHOICE OF LAW. THE LOAN DOCUMENTS (OTHER THAN THOSE CONTAINING A
CONTRARY EXPRESS CHOICE OF LAW PROVISION) SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE INTERNAL LAWS (INCLUDING SECTION 5-1401 OF THE GENERAL
OBLIGATION LAW BUT OTHERWISE WITHOUT REGARD TO CONFLICT OF LAW PROVISIONS) OF
THE STATE OF NEW YORK, BUT GIVING EFFECT TO FEDERAL LAWS APPLICABLE TO NATIONAL
BANKS. IF ANY COURT, TRIBUNAL OR OTHER ENTITY WITH JURISDICTION OVER THE LOAN
DOCUMENTS AND THE TRANSACTIONS EVIDENCED THEREBY REJECTS THE FOREGOING CHOICE OF
NEW YORK LAW, THEN THE LOAN DOCUMENTS (OTHER THAN THOSE CONTAINING A CONTRARY
EXPRESS CHOICE OF LAW PROVISION) SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE INTERNAL LAWS (INCLUDING 735 ILCS SECTION 105/5-1 ET SEQ.
BUT OTHERWISE WITHOUT REGARD TO CONFLICT OF LAW PROVISIONS) OF THE STATE OF
ILLINOIS, BUT GIVING EFFECT TO FEDERAL LAWS APPLICABLE TO NATIONAL BANKS.
15.2 CONSENT TO JURISDICTION. THE BORROWER HEREBY IRREVOCABLY SUBMITS TO
THE NON-EXCLUSIVE JURISDICTION OF ANY UNITED STATES FEDERAL COURT SITTING IN OR
WITH DIRECT JURISDICTION OVER THE SOUTHERN DISTRICT OF NEW YORK OR ANY NEW YORK
STATE COURT SITTING IN OR WITH DIRECT JURISDICTION OVER THE BOROUGH OF MANHATTAN
IN ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO ANY LOAN DOCUMENTS AND
THE BORROWER HEREBY IRREVOCABLY AGREES THAT ALL CLAIMS IN RESPECT OF SUCH ACTION
OR PROCEEDING MAY BE HEARD AND DETERMINED IN ANY SUCH COURT AND IRREVOCABLY
WAIVES ANY OBJECTION IT MAY NOW OR HEREAFTER HAVE AS TO THE VENUE OF ANY SUCH
SUIT, ACTION OR PROCEEDING BROUGHT IN SUCH A COURT OR THAT SUCH COURT IS AN
INCONVENIENT FORUM. NOTHING HEREIN SHALL LIMIT THE RIGHT OF THE AGENT, ANY LC
ISSUER, ANY LENDER OR ANY HOLDER OF SECURED OBLIGATIONS TO BRING PROCEEDINGS
AGAINST THE BORROWER IN THE COURTS OF ANY OTHER JURISDICTION. ANY JUDICIAL
PROCEEDING BY THE BORROWER AGAINST THE AGENT, ANY LC ISSUER, ANY LENDER OR ANY
HOLDER OF SECURED OBLIGATIONS OR ANY AFFILIATE OF THE AGENT, ANY LC ISSUER, ANY
LENDER OR ANY HOLDER OF SECURED OBLIGATIONS INVOLVING, DIRECTLY OR INDIRECTLY,
ANY MATTER IN ANY WAY ARISING OUT OF, RELATED TO, OR CONNECTED WITH ANY LOAN
DOCUMENT SHALL BE BROUGHT ONLY IN A UNITED STATES FEDERAL COURT SITTING IN OR
WITH DIRECT JURISDICTION OVER THE SOUTHERN DISTRICT OF NEW YORK OR ANY NEW
104
YORK STATE COURT SITTING IN OR WITH DIRECT JURISDICTION OVER THE BOROUGH OF
MANHATTAN.
15.3 WAIVER OF JURY TRIAL. THE BORROWER, THE AGENT, EACH LC ISSUER, EACH
LENDER, AND EACH OTHER HOLDER OF SECURED OBLIGATIONS HEREBY WAIVE TRIAL BY JURY
IN ANY JUDICIAL PROCEEDING INVOLVING, DIRECTLY OR INDIRECTLY, ANY MATTER
(WHETHER SOUNDING IN TORT, CONTRACT OR OTHERWISE) IN ANY WAY ARISING OUT OF,
RELATED TO, OR CONNECTED WITH ANY LOAN DOCUMENT OR THE RELATIONSHIP ESTABLISHED
THEREUNDER.
ARTICLE XVI
PRIOR CREDIT AGREEMENT
The Borrower, certain of the Lenders, and the Agent are parties to the
Prior Credit Agreement. The Borrower, the Lenders, and the Agent agree that upon
(i) the execution and delivery of this Agreement by each of the parties hereto
and (ii) satisfaction (or waiver by the aforementioned parties) of the
conditions precedent set forth in Section 4.1, the terms and conditions of the
Prior Credit Agreement shall be and hereby are amended, superseded, and restated
in their entirety by the terms and provisions of this Agreement. All amounts
outstanding or otherwise due and payable under the Prior Credit Agreement prior
to the Closing Date shall, on and after the Closing Date, be outstanding and due
and payable under this Agreement. Notwithstanding the foregoing, the Borrower
affirms its rights, duties and obligations under the Security Agreement,
including, without limitation, the security interest granted thereunder, and the
other Loan Documents delivered in connection herewith, and agrees and
acknowledges that this Agreement constitutes the "Credit Agreement" referenced
therein.
ARTICLE XVII
USA PATRIOT ACT NOTIFICATION
The following notification is provided to the Borrower pursuant to Section
326 of the Uniting and Strengthening America by Providing Appropriate Tools
Required to Intercept and Obstruct Terrorism (USA PATRIOT Act) of 2001, 31
U.S.C. Section 5318:
IMPORTANT INFORMATION ABOUT PROCEDURES FOR OPENING A NEW ACCOUNT. To help
the government of the United States of America fight the funding of terrorism
and money laundering activities, Federal law requires all financial institutions
to obtain, verify, and record information that identifies each Person that opens
an account, including any deposit account, treasury management account, loan,
other extension of credit, or other financial services product. Accordingly,
when the Borrower opens an account, the Agent and the Lenders will ask for the
Borrower's name, tax identification number, business address, and other
information that will allow the Agent and the Lenders to identify the Borrower.
The Agent and the Lenders may also ask to see the Borrower's legal
organizational documents or other identifying documents.
105
IN WITNESS WHEREOF, the Borrower, the Lenders, the initial LC Issuer, and
the Agent have executed this Agreement as of the date first above written.
TESORO PETROLEUM CORPORATION,
as the Borrower
By: /s/ G. ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
---------------------------------------
Print Name: G. ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Title: Vice President, Finance
and Treasurer
Signature Page to Third Amended and Restated Credit Agreement
BANK ONE, NA (MAIN OFFICE CHICAGO),
individually, as initial LC Issuer, and as
Administrative Agent
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇
---------------------------------------
Print Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇
Title: Director
THIRD AMENDED AND RESTATED CREDIT AGREEMENT SIGNATURE PAGE
BANK OF AMERICA, N.A.
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
---------------------------------------
Print Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Authorized Officer
THIRD AMENDED AND RESTATED CREDIT AGREEMENT SIGNATURE PAGE
STATE OF CALIFORNIA PUBLIC
EMPLOYEES RETIREMENT SYSTEM
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
---------------------------------------
Print Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Title: Senior Investment Officer
THIRD AMENDED AND RESTATED CREDIT AGREEMENT SIGNATURE PAGE
FORTIS CAPITAL CORP.
BY: /s/ ▇▇▇▇▇ ▇▇▇▇▇▇
---------------------------------------
PRINT NAME: ▇▇▇▇▇ ▇▇▇▇▇▇
TITLE: Senior Vice President
BY: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
---------------------------------------
PRINT NAME: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
TITLE: Managing Director
THIRD AMENDED AND RESTATED CREDIT AGREEMENT SIGNATURE PAGE
WELL FARGO FOOTHILL, LLC
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
---------------------------------------
Print Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Assistant Vice President
THIRD AMENDED AND RESTATED CREDIT AGREEMENT SIGNATURE PAGE
LASALLE BUSINESS CREDIT, LLC
By: /s/ ▇▇▇ ▇▇▇▇▇▇
---------------------------------------
Print Name: ▇▇▇ ▇▇▇▇▇▇
Title: Senior Vice President
THIRD AMENDED AND RESTATED CREDIT AGREEMENT SIGNATURE PAGE
PNC BANK, N.A.
By: /s/ ▇▇▇▇▇▇▇ ▇▇▇▇
---------------------------------------
Print Name: ▇▇▇▇▇▇▇ ▇▇▇▇
Title: Vice President
THIRD AMENDED AND RESTATED CREDIT AGREEMENT SIGNATURE PAGE
PB CAPITAL CORPORATION
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
---------------------------------------
Print Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Vice President
By: /s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇
---------------------------------------
Print Name: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Title: Managing Director
THIRD AMENDED AND RESTATED CREDIT AGREEMENT SIGNATURE PAGE
GUARANTY BANK
By: /s/ ▇▇▇ ▇. ▇▇▇▇▇▇▇▇
---------------------------------------
Print Name: ▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Title: Senior Vice President
THIRD AMENDED AND RESTATED CREDIT AGREEMENT SIGNATURE PAGE
CALYON NEW YORK BRANCH
By: /s/ ATTILA COACH
-------------------------------------
Name: ATTILA COACH
Title: MANAGING DIRECTOR
By: /s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
-------------------------------------
Name: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Title: MANAGING DIRECTOR
THIRD AMENDED AND RESTATED CREDIT AGREEMENT SIGNATURE PAGE
UBS AG, STAMFORD BRANCH
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇
-------------------------------------
Print Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇
Title: Director
Banking Products
Service, US
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
-------------------------------------
Print Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: Executive Director
Banking Products
Service, US
THIRD AMENDED AND RESTATED CREDIT AGREEMENT SIGNATURE PAGE
SIEMENS FINANCIAL SERVICES, INC.
By: /s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
-------------------------------------
Print Name: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
Title: Senior Vice President
THIRD AMENDED AND RESTATED CREDIT AGREEMENT SIGNATURE PAGE
THE ROYAL BANK OF SCOTLAND PLC
By: /s/ ▇▇▇▇ ▇▇▇▇▇▇▇▇
-------------------------------------
Print Name: ▇▇▇▇ ▇▇▇▇▇▇▇▇
Title: Senior Vice President
U,S. BANK, NATIONAL ASSOCIATION
By: /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
-------------------------------------
Print Name: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Title: Vice President
THIRD AMENDED AND RESTATED CREDIT AGREEMENT SIGNATURE PAGE
HIBERNIA NATIONAL BANK
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
-------------------------------------
Print Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: Vice President
THIRD AMENDED AND RESTATED CREDIT AGREEMENT SIGNATURE PAGE
ALLIED IRISH BANKS PLC
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇
-------------------------------------
Print Name: ▇▇▇▇▇▇ ▇▇▇▇
Title: VP
By: /s/ ▇▇▇▇ ▇▇▇▇▇▇▇
-------------------------------------
Print Name: ▇▇▇▇ ▇▇▇▇▇▇▇
Title: SVP
THIRD AMENDED AND RESTATED CREDIT AGREEMENT SIGNATURE PAGE
WACHOVIA BANK, NATIONAL ASSOCIATION
BY: /s/ ▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
-------------------------------------
Print Name: ▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Title: Director
THIRD AMENDED AND RESTATED CREDIT AGREEMENT SIGNATURE PAGE
NATIONAL CITY BUSINESS CREDIT, INC.
By: /s/ ▇▇▇▇▇ ▇▇▇▇▇
-------------------------------------
Print Name: ▇▇▇▇▇ ▇▇▇▇▇
Title: AVP
THIRD AMENDED AND RESTATED CREDIT AGREEMENT SIGNATURE PAGE
UFJ BANK LIMITED
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
-------------------------------------
Print Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: Senior Vice President
THIRD AMENDED AND RESTATED CREDIT AGREEMENT SIGNATURE PAGE
SUMITOMO MITSUI BANKING CORP.
By: /s/ ▇▇▇▇▇▇▇▇ ▇▇▇▇
-------------------------------------
Print Name: ▇▇▇▇▇▇▇▇ ▇▇▇▇
Title: Senior Vice President
THIRD AMENDED AND RESTATED CREDIT AGREEMENT SIGNATURE PAGE
THE FROST NATIONAL BANK
By: /s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
-------------------------------------
Print Name: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
Title: Senior Vice President
THIRD AMENDED AND RESTATED CREDIT AGREEMENT SIGNATURE PAGE
NATEXIS BANQUES POPULAIRES
By: /s/ ▇▇▇▇▇▇ ▇▇▇▇▇
-------------------------------------
Print Name: ▇▇▇▇▇▇ ▇▇▇▇▇
Title: Vice President
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
-------------------------------------
Print Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, III
Title: Vice President and Group
Manager
THIRD AMENDED AND RESTATED CREDIT AGREEMENT SIGNATURE PAGE
THE BANK OF TOKYO-MITSUBISHI, LTD.,
HOUSTON AGENCY
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
--------------------------------------
Print Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Title: Vice President & Manager
THIRD AMENDED AND RESTATED CREDIT AGREEMENT SIGNATURE PAGE
BANK OF SCOTLAND
By: /s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇
--------------------------------------
Print Name: ▇▇▇▇▇ ▇▇▇▇▇▇▇
Title: Assistant Vice President
THIRD AMENDED AND RESTATED CREDIT AGREEMENT SIGNATURE PAGE
RZB FINANCE LLC,
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇
--------------------------------------
Print Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: Group Vice President
RZB FINANCE LLC,
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
--------------------------------------
Print Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Title: Group Vice President
▇▇▇▇▇▇▇ BUSINESS CREDIT CORPORATION
By: /s/ ▇▇▇▇ ▇▇▇▇▇▇▇▇
--------------------------------------
Print Name: ▇▇▇▇ ▇▇▇▇▇▇▇▇
Title: Assistant Vice President
THIRD AMENDED AND RESTATED CREDIT AGREEMENT SIGNATURE PAGE
ALASKA PACIFIC BANK
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
--------------------------------------
Print Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Title: SENIOR VICE PRESIDENT
COMMIMENT SCHEDULE
REVOLVER PREFUNDED
EXISTING LENDERS ALLOCATION ALLOCATION TOTAL
---------------- ---------- ---------- -----
Bank of America/Fleet 58,000,000 10.50% 5,000,000 5.00% 63,000,000 8.70%
Bank One 58,000,000 10.50% 5,000,000 5.00% 63,000,000 8.70%
CalPERS 45,000,000 0.20% 0.00% 45,000,000 6.90%
Fortis Capital 37,500,000 0.60% 0.00% 37,500,000 5.80%
▇▇▇▇▇ Fargo Foothill 30,000,000 5.50% 5,000,000 6.00% 35,000,000 3.40%
LaSalle Business Credit 27,500,000 5.00% 0.00% 27,500,000 4.20%
PNC Bank 25,000,000 4.50% 0.00% 25,000,000 3.80%
Guaranty Bank 20,000,000 3.60% 3,000,000 3.00% 23,000,000 3.50%
PB Capital 20,000,000 3.60% 3,000,000 3.00% 23,000,000 2.50%
UBS 17,500,000 3.20% 5,000,000 5.00% 22,500,000 3.50%
Credit Lyonnias 20,000,000 3.50% 0.00% 20,000,000 3.50%
TCW 18,000,000 3.30% 0.00% 18,000,000 ?
Allied Irish Bank 12,500,000 2.30% 3,000,000 3.00% 15,500,000 2.00%
Royal Bank of Scottland 15,000,000 2.70% 0.00% 15,000,000 2.00%
Siemens Financial 15,000,000 2.70% 0.00% 15,000,000 2.30%
US Bank 14,000,000 2.60% 0.00% 14,000,000 2.30%
Natexis 10,000,000 ? 3,000,000 3.00% 13,000,000 2.20%
Hibernia National Bank 12,500,000 2.30% 0.00% 12,500,000 2.00%
National City 12,500,000 2.30% 0.00% 12,500,000 1.80%
Sumitomo 12,500,000 2.30% 0.00% 12,500,000 1.90%
UFJ 12,500,000 2.30% 0.00% 12,500,000 1.80%
Wachovia (Congress) 12,500,000 2.30% 0.00% 12,500,000 1.00%
Bank of Scottland 10,000,000 1.80% 0.00% 10,000,000 1.90%
BOTM 10,000,000 1.00% 0.00% 10,000,000 1.50%
Frost National Bank 10,000,000 1.00% 0.00% 10,000,000 1.50%
▇▇▇▇▇▇▇ Business Credit 5,000,000 0.90% 3,000,000 3.00% 8,000,000 1.50%
RZB 7,500,000 1.40% 0.00% 7,500,000 1.20%
Credit Suisse Asset Management 0.00% 7,000,000 7.70% 7,000,000 ?
TCW 0.00% 7,000,000 7.00% 7,000,000 ?
▇.▇. ▇▇▇▇▇▇ (IDM) 0.00% 6,000,000 6.00% 6,000,000 ?
AMEX 0.00% 5,000,000 5.00% 5,000,000 0.90%
Deerfield 0.00% 5,000,000 5.00% 5,000,000 0.80%
▇▇▇▇▇ ▇▇▇▇▇ 0.00% 5,000,000 5.00% 5,000,000 0.80%
Franklin 0.00% 5,000,000 5.00% 5,000,000 0.00%
Guggenheim 0.00% 5,000,000 5.00% 5,000,000 0.00%
Sankaty 0.00% 5,000,000 5.00% 5,000,000 0.00%
Travelers 0.00% 5,000,000 5.00% 5,000,000 0.80%
Invesco 0.00% 4,000,000 4.00% 4,000,000 0.60%
Alladin 0.00% 3,000,000 3.00% 3,000,000 0.50%
Harch 0.00% 3,000,000 3.00% 3,000,000 0.50%
Alaska Pacific Bank 2,000,000 0.40% 0.00% 2,000,000 0.03%
----------- ---- --------- ---- --------- ----
550,000,000
PRICING SCHEDULE
Applicable
Margin for Revolving Revolving Revolving Revolving
Revolving Revolving Level II Level III Level IV Level V
Loans Level I Status Status Status Status Status
----- -------------- ------ ------ ------ ------
Eurodollar Rate 2.00% 2.25% 2.50% 2.75% 3.00%
Floating Rate 0.25% 0.50% 0.75% 1.00% 1.25%
Pre-Funded Pre-Funded Pre-Funded Pre-Funded
Level I Status Level II Status Level III Status Level IV Status
-------------- --------------- ---------------- ---------------
Pre-Funded Letter of 2.00% 2.25% 2.50% 2.75%
Credit Fee Rate
Applicable Fee Rate Tier I Utilization Tier II Utilization Tier III Utilization
------------------- ------------------ ------------------- --------------------
Commitment Fee 0.25% 0.50% 0.75%
For the purposes of this Schedule, the following terms have the following
meanings, subject to the final paragraph of this Schedule:
"Revolving Level I Status" exists at any date if, as of the last day of
the applicable fiscal quarter of the Borrower, average daily Excess Availability
for such fiscal quarter was greater than 55% of the average weekly Borrowing
Base for such fiscal quarter.
"Revolving Level II Status" exists at any date if, as of the last day of
the applicable fiscal quarter of the Borrower, (i) the Borrower has not
qualified for Revolving Level I Status and (ii) average daily Excess
Availability for such fiscal quarter was less than or equal to 55% of the
average weekly Borrowing Base for such fiscal quarter but greater than 45% of
the average weekly Borrowing Base for such fiscal quarter.
"Revolving Level III Status" exists at any date if, as of the last day of
the applicable fiscal quarter, (i) the Borrower has not qualified for Revolving
Level I Status or Revolving Level II Status and (ii) average daily Excess
Availability for such fiscal quarter was less than or equal to 45% of the
average weekly Borrowing Base for such fiscal quarter but greater than 30% of
the average weekly Borrowing Base for such fiscal quarter.
"Revolving Level IV Status" exists at any date if, as of the last day of
the applicable fiscal quarter, (i) the Borrower has not qualified for Revolving
Level I Status, Revolving Level II Status, or Revolving Level III Status and
(ii) average daily Excess Availability for such fiscal quarter was less than or
equal to 30% of the average weekly Borrowing Base for such fiscal quarter but
greater than 15% of the average weekly Borrowing Base for such fiscal quarter.
"Revolving Level V Status" exists at any date if, as of the last day of
the applicable fiscal quarter, (i) the Borrower has not qualified for Revolving
Level I Status, Revolving Level II Status, Revolving Level III Status or
Revolving Level IV Status, and (ii) average daily Excess Availability for such
fiscal quarter was less than or equal to 15% of the average weekly Borrowing
Base for such fiscal quarter.
"Revolving Status" means either Revolving Level I Status, Revolving Level
II Status, Revolving Level III Status, Revolving Level IV Status, or Revolving
Level V Status.
"Pre-Funded Level I Status" exists at any date if, as of the last day of
the applicable fiscal quarter of the Borrower, average daily Excess Availability
for such fiscal quarter was greater than 45% of the average weekly Borrowing
Base for such fiscal quarter.
"Pre-Funded Level II Status" exists at any date if, as of the last day of
the applicable fiscal quarter, (i) the Borrower has not qualified for Pre-Funded
Level I Status and (ii) average daily Excess Availability for such fiscal
quarter was less than or equal to 45% of the average weekly Borrowing Base for
such fiscal quarter but greater than 30% of the average weekly Borrowing Base
for such fiscal quarter.
"Pre-Funded Level III Status" exists at any date if, as of the last day of
the applicable fiscal quarter, (i) the Borrower has not qualified for Pre-Funded
Level I Status or Pre-Funded Level II Status, and (ii) average daily Excess
Availability for such fiscal quarter was less than or equal to 30% of the
average weekly Borrowing Base for such fiscal quarter but greater than 15% of
the average weekly Borrowing Base for such fiscal quarter.
"Pre-Funded Level IV Status" exists at any date if, as of the last day of
the applicable fiscal quarter, (i) the Borrower has not qualified for Pre-Funded
Level I Status, Pre-Funded Level II Status or Pre-Funded Level III Status and
(ii) average daily Excess Availability for such fiscal quarter was less than or
equal to 15% of the average weekly Borrowing Base for such fiscal quarter.
"Pre-Funded Status" means either Pre-Funded Level I Status, Pre-Funded
Level II Status, Pre-Funded Level III Status or Pre-Funded Level IV Status.
"Tier I Utilization" means, on any date of determination, the average
Aggregate Outstanding Revolving Loan Credit Exposure on such date was greater
than 66% of the Aggregate Revolving Loan Commitment on such date.
"Tier II Utilization" means, on any date of determination, the average
Aggregate Outstanding Revolving Loan Credit Exposure on such date was greater
than or equal to 33--1/3rd% of the Aggregate Revolving Loan Commitment on such
date but less than or equal to 66% of the Aggregate Revolving Loan Commitment on
such date.
"Tier III Utilization" means, on any date of determination, the average
Aggregate Outstanding Revolving Loan Credit Exposure on such date was less than
33-1/3rd% of the Aggregate Revolving Loan Commitment on such date.
The Applicable Margin, the Applicable Fee Rate, and the Pre-Funded
Letter of Credit Fee Rate shall be determined in accordance with the foregoing
table based on the Borrower's Revolving Status or Pre-Funded Status, as
applicable, for the applicable fiscal quarter. Such Revolving Status or
Pre-Funded Status, as applicable, shall be determined based upon the Interim
Collateral Reports and Monthly Collateral Reports delivered for such fiscal
quarter. Adjustments, if any, to the Applicable Margin, the Applicable Fee Rate
and the Pre-Funded Letter of Credit Fee Rate shall be effective five Business
Days after the Agent has received all of the applicable Interim Collateral
Reports and Monthly Collateral Reports. If the Borrower fails to deliver such
Interim Collateral Reports and Monthly Collateral Reports to the Agent at the
time required pursuant to Section 6.1, then the Applicable Margin, the
Applicable Fee Rate, and the Pre-Funded Letter of Credit Fee Rate shall be the
highest Applicable Margin, Applicable Fee Rate, and Pre-Funded Letter of Credit
Fee Rate set forth in the foregoing table until the date on which such Interim
Collateral Reports and Monthly Collateral Reports are so delivered.
Notwithstanding the foregoing, for the period beginning on the Closing Date and
ending on the fifth Business Day following the date on which the last Interim
Collateral Report and the last Monthly Collateral Report are required to be
delivered pursuant to Section 6.1 for the fiscal quarter ending September 30,
2004, Revolving Level II Status, Pre-Funded Level I Status and Tier II
Utilization shall be in effect.