1
Exhibit 10.1
$225,000,000
AMENDED AND RESTATED CREDIT AGREEMENT
AMONG
RANGE RESOURCES CORPORATION,
AS BORROWER,
THE LENDERS FROM TIME TO TIME PARTIES HERETO,
AS LENDERS,
BANK ONE, TEXAS, N.A.,
AS ADMINISTRATIVE AGENT,
CHASE BANK OF TEXAS, N.A.,
AS SYNDICATION AGENT,
AND
BANK OF AMERICA, N.A.,
AS DOCUMENTATION AGENT
DATED AS OF SEPTEMBER 30, 1999
2
TABLE OF CONTENTS
ARTICLE 1 - DEFINITIONS...........................................................................................2
1.01. DEFINED TERMS...................................................................................2
1.02. OTHER DEFINITIONAL PROVISIONS..................................................................19
ARTICLE 2 - AMOUNT AND TERMS OF COMMITMENTS......................................................................19
2.01. COMMITMENTS....................................................................................19
2.02. PROCEDURE FOR BORROWING........................................................................20
2.03. NOTES..........................................................................................20
2.04. INTEREST RATES AND PAYMENT DATES...............................................................21
2.05. NON-RECEIPT OF FUNDS BY ADMINISTRATIVE AGENT...................................................22
2.06. USE OF PROCEEDS................................................................................23
2.07. CONVERSIONS AND RENEWALS.......................................................................23
2.08. LIMITATION ON NUMBER OF EURODOLLAR LOANS.......................................................23
2.09. PREPAYMENTS....................................................................................24
2.10. MANNER AND APPLICATION OF PAYMENTS.............................................................24
2.11. VOLUNTARY REDUCTION OF COMMITMENT..............................................................25
ARTICLE 3 - LETTERS OF CREDIT....................................................................................25
3.01. LETTERS OF CREDIT..............................................................................25
3.02. PROCEDURE FOR ISSUANCE OF LETTERS OF CREDIT....................................................26
3.03. FEES, COMMISSIONS, AND OTHER CHARGES...........................................................26
3.04. LETTER OF CREDIT PARTICIPATION.................................................................27
3.05. REIMBURSEMENT OBLIGATION OF BORROWER...........................................................28
3.06. OBLIGATIONS ABSOLUTE...........................................................................29
3.07. LETTER OF CREDIT PAYMENTS......................................................................29
3.08. LETTER OF CREDIT APPLICATIONS..................................................................30
3.09. CASH COLLATERALIZATION OF LETTERS OF CREDIT....................................................30
ARTICLE 4 - BORROWING BASE.......................................................................................30
4.01. DETERMINATION OF BORROWING BASE................................................................30
4.02. PERIODIC DETERMINATION.........................................................................31
4.03. SPECIAL REDETERMINATION REQUESTED BY BORROWER..................................................31
4.04. SPECIAL DETERMINATIONS REQUESTED BY REQUIRED LENDERS...........................................32
4.05. INITIAL BORROWING BASE.........................................................................32
4.06. OVER ADVANCE...................................................................................32
ARTICLE 5 - COLLATERAL...........................................................................................33
5.01. SECURITY.......................................................................................33
5.02. GUARANTIES.....................................................................................34
xxxii
3
5.03. LEGAL OPINIONS; CORPORATE MATTERS..............................................................34
5.04. ADDITIONAL TITLE DATA..........................................................................34
5.05. BENEFITS OF COLLATERAL.........................................................................34
5.06. STATUS OF COLLATERAL IN EVENT OF DEFAULT.......................................................35
ARTICLE 6 - CONDITIONS PRECEDENT.................................................................................35
6.01. CONDITIONS PRECEDENT TO RESTATEMENT OF EXISTING CREDIT AGREEMENT AND INITIAL EXTENSION
OF CREDIT HEREUNDER............................................................................35
(a) CLOSING DELIVERIES....................................................................35
(b) NO MATERIAL ADVERSE CHANGE............................................................37
(c) NO LEGAL PROHIBITION..................................................................37
(d) NO LITIGATION.........................................................................37
(e) OTHER MATTERS.........................................................................37
(f) CLOSING FEES..........................................................................37
6.02. CONDITIONS TO EACH LOAN AND EACH LETTER OF CREDIT..............................................37
ARTICLE 7 - REPRESENTATIONS, WARRANTIES, AND COVENANTS...........................................................38
7.01. WARRANTIES.....................................................................................38
(a) FINANCIAL CONDITION...................................................................38
(b) NO CHANGE.............................................................................39
(c) CORPORATE EXISTENCE...................................................................39
(d) CORPORATE POWER.......................................................................39
(e) INFORMATION...........................................................................40
(f) AUTHORIZATIONS........................................................................40
(g) ENFORCEABLE OBLIGATIONS...............................................................40
(h) NO LEGAL BAR..........................................................................40
(i) COMPLIANCE............................................................................40
(j) DEBTS OF OTHERS.......................................................................40
(k) NO MATERIAL LITIGATION................................................................41
(l) SUBSIDIARIES..........................................................................41
(m) ERISA.................................................................................41
(n) ENVIRONMENTAL MATTERS.................................................................41
(o) TITLES................................................................................42
(p) RESERVE REPORTS.......................................................................42
(q) INTELLECTUAL PROPERTY.................................................................42
(r) NO BURDENSOME RESTRICTIONS............................................................42
(s) TAXES.................................................................................42
(t) FEDERAL REGULATIONS...................................................................43
(u) INVESTMENT COMPANY ACT; OTHER REGULATIONS.............................................43
(v) YEAR 2000 PROBLEM.....................................................................43
7.02. AFFIRMATIVE COVENANTS..........................................................................43
xxxiii
4
(a) CORPORATE EXISTENCE...................................................................43
(b) MAINTENANCE OF BOOKS AND RECORDS......................................................43
(c) FINANCIAL INFORMATION.................................................................44
(d) RIGHT TO INSPECT......................................................................45
(e) PAYMENT OF OTHER OBLIGATIONS..........................................................45
(f) PERFORMANCE...........................................................................45
(g) INSURANCE.............................................................................45
(h) DEPOSITORY ACCOUNTS...................................................................45
(i) NOTICE OF DEFAULT AND LITIGATION......................................................46
(j) FURTHER ASSURANCES....................................................................46
(k) MAINTENANCE AND OPERATION OF PROPERTY.................................................46
(l) ERISA.................................................................................47
(m) ENVIRONMENTAL MATTERS.................................................................47
(n) ENVIRONMENTAL INDEMNITY...............................................................47
(o) OTHER INDEMNITY.......................................................................48
7.03. NEGATIVE COVENANTS.............................................................................48
(a) OTHER LIENS...........................................................................49
(b) OTHER DEBT............................................................................49
(c) MERGERS AND SALES OF ASSETS...........................................................49
(d) CHANGES IN BUSINESS...................................................................50
(e) PLAN CONTRIBUTIONS....................................................................50
(f) ADVANCES AND INVESTMENTS..............................................................50
(g) RESTRICTED PAYMENTS...................................................................51
(h) INTEREST PAYMENTS.....................................................................51
(i) OIL AND GAS HEDGE TRANSACTIONS........................................................51
(j) TRANSACTIONS WITH AFFILIATES..........................................................51
(k) PLANS.................................................................................51
(l) SPECULATIVE HEDGE TRANSACTIONS........................................................51
(m) OPTIONAL PAYMENTS AND MODIFICATIONS...................................................52
(n) LIMITATION ON SALES AND LEASEBACKS....................................................52
(o) LIMITATION ON NEGATIVE PLEDGE CLAUSES.................................................52
(p) RESTRICTIONS WITH RESPECT TO OBLIGATIONS OF REFC......................................52
7.04. FINANCIAL COVENANTS............................................................................52
(a) CONSOLIDATED TANGIBLE NET WORTH.......................................................52
(b) SENIOR DEBT INTEREST COVERAGE RATIO...................................................53
(c) TOTAL DEBT INTEREST COVERAGE RATIO....................................................53
(d) SENIOR DEBT LEVERAGE RATIO............................................................53
(e) TOTAL DEBT LEVERAGE RATIO.............................................................53
(f) CURRENT RATIO.........................................................................53
ARTICLE 8 - DEFAULT..............................................................................................53
8.01. EVENTS OF DEFAULT..............................................................................53
xxxiv
5
8.02. REMEDIES.......................................................................................56
ARTICLE 9 - AGENCY PROVISIONS....................................................................................57
9.01. APPOINTMENT....................................................................................57
9.02. DELEGATION OF DUTIES...........................................................................57
9.03. EXCULPATORY PROVISIONS.........................................................................57
9.04. RELIANCE BY AGENTS.............................................................................58
9.05. NOTICE OF DEFAULT..............................................................................58
9.06. NON-RELIANCE ON AGENTS AND OTHER LENDERS.......................................................58
9.07. INDEMNIFICATION................................................................................59
9.08. EACH AGENT IN ITS INDIVIDUAL CAPACITY..........................................................59
9.09. SUCCESSOR AGENT................................................................................60
9.10. ISSUING LENDER.................................................................................60
ARTICLE 10 - PROTECTION OF YIELD; CHANGE IN LAWS.................................................................60
10.01. RISK-BASED CAPITAL.............................................................................60
10.02. BASIS FOR DETERMINING INTEREST RATE APPLICABLE TO EURODOLLAR LOANS INADEQUATE..................61
10.03. ILLEGALITY OF EURODOLLAR LOANS.................................................................61
10.04. INCREASED COST OF EURODOLLAR LOANS.............................................................62
10.05. ALTERNATIVE LOANS SUBSTITUTED FOR AFFECTED EURODOLLAR LOANS....................................63
10.06. FUNDING LOSS INDEMNIFICATION...................................................................63
10.07. TAXES..........................................................................................63
10.08. DISCRETION OF LENDERS AS TO MANNER OF FUNDING..................................................64
10.09. LIMITATION ON ADDITIONAL AMOUNTS...............................................................64
10.10. REPLACEMENT LENDERS............................................................................64
ARTICLE 11 - FEES................................................................................................65
11.01 COMMITMENT FEES................................................................................65
11.02. AGENCY FEES....................................................................................66
11.03. LETTER OF CREDIT FEES..........................................................................66
11.04. OTHER FEES.....................................................................................66
ARTICLE 12 - GENERAL PROVISIONS..................................................................................66
12.01. EXPENSES.......................................................................................66
12.02. NON-WAIVER.....................................................................................67
12.03. AMENDMENT AND WAIVERS..........................................................................67
12.04. SURVIVAL.......................................................................................67
12.05. LIMITATION ON INTEREST.........................................................................67
12.06. INVALID PROVISIONS.............................................................................68
12.07. WAIVER OF CONSUMER CREDIT LAW..................................................................68
xxxv
6
12.08. SUCCESSORS AND ASSIGNS.........................................................................68
12.09. FOREIGN LENDERS, PARTICIPANTS, AND ASSIGNEES...................................................69
12.10. NOTICES........................................................................................70
12.11. REPORTS AND CERTIFICATES.......................................................................71
12.12. GOVERNING LAW..................................................................................71
12.13. COMPLETE AGREEMENT.............................................................................71
12.14. WAIVER OF JURY TRIAL...........................................................................71
12.15. COUNTERPARTS; EFFECTIVENESS....................................................................71
12.16. CONFIDENTIALITY................................................................................71
xxxvi
7
Schedule 1 - Commitments
Schedule 2 - Addresses for Notices
Schedule 3 - List of Subsidiaries
Exhibit A - Form of Note
Exhibit B - Form of Guaranty Agreement
Exhibit C - Form of Pledge Agreement
Exhibit D - Form of Notice of Borrowing
Exhibit E - Form of Rollover Notice
Exhibit F - Form of Request for Letter of Credit
Exhibit G - Form of Compliance Certificate
Exhibit H - Form of Assignment Agreement
xxxvii
8
AMENDED AND RESTATED CREDIT AGREEMENT
-------------------------------------
This Amended and Restated Credit Agreement is made on September 30,
1999, among RANGE RESOURCES CORPORATION, a Delaware corporation ("BORROWER"),
BANK ONE, TEXAS, N.A., as Administrative Agent ("ADMINISTRATIVE AGENT"), CHASE
BANK OF TEXAS, N.A., as Syndication Agent ("SYNDICATION AGENT"), and BANK OF
AMERICA, N.A., as Documentation Agent ("DOCUMENTATION AGENT") (collectively
"AGENTS"), and the banks, financial institutions, and other entities listed on
attached SCHEDULE 1, as Lenders (individually a "LENDER" and collectively
"LENDERS").
RECITALS:
A. Borrower, Agents, and Lenders are parties to a Credit Agreement
dated as of February 14, 1997 (as amended through and including the date hereof,
the "EXISTING CREDIT AGREEMENT"), pursuant to which credit is outstanding to
Borrower.
B. Borrower intends to contribute, or cause its Subsidiaries to
contribute, the Appalachian Properties (as defined below) to Great Lakes Energy
Partners, L.L.C., a Delaware limited liability company ("GLEP"), in exchange for
an equity interest in GLEP equal to 50%.
C. Immediately after giving effect to the GLEP Transaction (as defined
below), but subject to the satisfaction of each condition precedent set forth in
SECTION 6.01 hereof, Borrower, Agents, and Lenders desire to amend and restate
the Existing Credit Agreement in its entirety in order to, among other things,
(a) amend and restate the aggregate Commitments of Lenders, and (b) modify
certain other provisions of the Existing Credit Agreement.
NOW, THEREFORE, in consideration of the premises, the representations,
warranties, covenants and agreements contained herein, and other good and
valuable consideration, the receipt and adequacy of which are hereby
acknowledged, the parties agree that upon satisfaction of each condition
precedent set forth in SECTION 6.01 hereof, the Existing Credit Agreement shall
be amended and restated in its entirety on the terms and conditions set forth
herein. It is the intention of the parties that upon satisfaction of the
conditions precedent, this Agreement shall amend, restate, supersede, and
replace the Existing Credit Agreement in its entirety; PROVIDED THAT (a) the
foregoing shall operate to renew, extend, amend, and modify the rights and
obligations of the parties under the Existing Credit Agreement (the "EXISTING
RIGHTS AND OBLIGATIONS"), but shall not effect a novation thereof, and (b)
except for such Liens securing the Existing Rights and Obligations which are no
longer required pursuant to the terms of this Agreement (and which are being
terminated and released pursuant to express written instruments to such effect
duly filed and recorded in the appropriate jurisdictions), the Liens securing
the
9
Existing Rights and Obligations shall not be extinguished, but shall be carried
forward and shall secure the Obligations as defined herein and as renewed,
extended, amended, and modified hereby. Borrower, Agents, and Lenders hereby
further agree as follows:
ARTICLE 1 - DEFINITIONS.
1.01. DEFINED TERMS. As used in this Agreement, the following terms
have the respective meanings assigned them in this Article or in the sections or
subsections referred to below:
ABR LOAN- means a Loan bearing interest with reference to the Adjusted
Base Rate.
ADDITIONAL PROPERTIES- has the meaning given that term in SECTION 4.03.
ADMINISTRATIVE AGENT- means Bank One, Texas, N.A., in its capacity as
Administrative Agent for Lenders.
ADJUSTED BASE RATE- means, for any day, a rate per annum (rounded
upwards, if necessary to the next 1/16 of 1%) equal to the greater of (a) the
Base Rate in effect on that day or (b) the Federal Funds Rate in effect on that
day plus 1/2 of 1%; any change in the Adjusted Base Rate due to a change in the
Base Rate or the Federal Funds Rate shall be effective as of the opening of
business on the effective day of the change in the Base Rate or the Federal
Funds Rate, respectively.
ADVANCE- means, with respect to any Person, any loan, advance, or
extension of credit to any other Person.
AFFILIATE- means, as to any person, any other Person (other than a
wholly owned Subsidiary) which, directly or indirectly, is in control of, is
controlled by, or is under common control with, that Person. For purposes of
this definition, "control" of a Person means the power, directly or indirectly,
either to (a) vote 10% or more of the securities having ordinary voting power
for the election of directors of that Person or (b) direct or cause the
direction of the management and policies of that Person, whether by contract or
otherwise.
AGENT- means any of Administrative Agent, Syndication Agent, and
Documentation Agent, and "AGENTS" means Administrative Agent, Syndication Agent,
and Documentation Agent.
AGREEMENT- means this Amended and Restated Credit Agreement, including
the Schedules and Exhibits hereto, as the same may be amended, supplemented, or
otherwise modified from time to time.
2
10
APPALACHIAN PROPERTIES- means all of Borrower's Oil and Gas Properties
in the states of Michigan, New York, Ohio, Pennsylvania, and West Virginia.
APPLICABLE MARGIN- means, on any day, the basis points set out below,
determined based upon the type of Loan and the Borrowing Base Usage on any such
day:
BORROWING BASE USAGE
less than 40% 40% less than 60% 60% less than 80% 80%
-------------------------------- -------------------- ------------------- ------------------- ----------------------
Eurodollar Loans 150 basis points 175 basis points 200 basis points 225 basis points
-------------------------------- -------------------- ------------------- ------------------- ----------------------
ABR Loans 25 basis points 50 basis points 75 basis points 100 basis points
ASSIGNMENT- has the meaning given that term in SECTION 10.10.
AUTHORIZED OFFICER- means, as to any Person, its Chairman, President,
or Chief Financial Officer duly authorized to act on behalf of that Person.
BASE RATE- means the rate of interest per annum publicly announced from
time to time by Administrative Agent as its "base rate" or "prime rate" of
interest, which rate may not be the lowest, best, or most favorable rate of
interest which Administrative Agent may charge on loans to its customers.
BORROWER- means Range Resources Corporation, a Delaware corporation.
BORROWER'S OIL AND GAS PROPERTIES- means all oil and gas properties,
pipelines, gathering systems, gas processing plants, and other similar assets
owned by Borrower and its Consolidated Subsidiaries, including related personal
property and other fixed assets and all related easements, servitudes, and
similar real property interests owned by Borrower and its Consolidated
Subsidiaries.
BORROWING- means any disbursement to Borrower under, or to satisfy the
obligations of the Loan Parties under, any of the Loan Documents. Any Borrowing
comprised of ABR Loans is an "ABR BORROWING", and any Borrowing comprised of
Eurodollar Loans is a "EURODOLLAR BORROWING."
Amended and Restated Credit Agreement - Page 3
11
BORROWING BASE- means, at the time of any Determination, the amount
then in effect as determined in accordance with Article 4.
BORROWING BASE DEFICIENCY- means, at any time, the amount by which the
aggregate of all Outstanding Obligations exceeds the Borrowing Base then in
effect. For purposes of determining the existence of and amount of any Borrowing
Base Deficiency, Letter of Credit Outstandings will not be deemed to be
outstanding hereunder to the extent they have been cash collateralized in the
manner required by SECTION 3.09.
BORROWING BASE USAGE- means at any time the quotient, expressed as a
percentage, of (a) the aggregate Outstanding Obligations at such time, divided
by (b) the Borrowing Base in effect at such time.
BORROWING DATE- means any Business Day specified in a Notice of
Borrowing or Request for Letter of Credit as a date on which Borrower requests a
Borrowing hereunder or that an Issuing Lender issue a Letter of Credit
hereunder.
BUSINESS DAY- means any day except a Saturday, Sunday, or other day on
which national banks in Dallas, Texas, are authorized or required by law to
close and, if the applicable day relates to a Eurodollar Loan, a day on which
dealings in dollar deposits are also carried on in the applicable interbank
market and banks are open for business in such market.
CAPITAL LEASE- means, for any Person as of any date, any lease of
property, real or personal, the obligations of the lessee in respect of which
are required in accordance with GAAP to be capitalized on a balance sheet of the
lessee.
CLOSING DATE- means the date that all conditions precedent set out in
SECTION 6.01 below have been satisfied, in each case satisfactory to Agents.
CODE- means the Internal Revenue Code of 1986, as amended from time to
time, and the regulations and published interpretations thereof.
COLLATERAL- means the Mortgaged Properties and all other assets of the
Loan Parties, now owned or hereafter acquired, upon which a Lien is purported to
be created by any Security Document.
COMMITMENT- means, with respect to any Lender, its commitment to make
Loans and participate in Letters of Credit hereunder in an aggregate amount
outstanding at any time not in excess of the amount of its Commitment as set
forth in SCHEDULE 1 hereto.
4
12
COMMITMENT PERCENTAGE- means, with respect to any Lender at any time,
the Commitment Percentage for that Lender set forth on SCHEDULE 1 hereto.
COMMITMENT PERIOD- means the period from and including the date hereof
to but not including the Termination Date or the earlier date on which the Total
Commitment shall terminate as provided herein.
COMMONLY CONTROLLED ENTITY- means an entity, whether or not
incorporated, which is under common control with Borrower within the meaning of
Section 4001 of ERISA or is part of a group which includes Borrower and which is
treated as a single employer under SECTION 414 of the Code.
CONSOLIDATED INTEREST EXPENSE- means with respect to Borrower and the
Consolidated Subsidiaries on a consolidated basis for any period, the sum of (a)
gross interest expense (including all cash and accrued interest expense) of
Borrower and the Consolidated Subsidiaries for that period on a consolidated
basis, including (i) the amortization of debt discounts, (ii) the amortization
of all fees payable in connection with the occurrence of Debt to the extent
included in interest expense, and (iii) the portion of any payments or accruals
with respect to Capital Leases allocable to interest expense and (b) capitalized
interest of Borrower and the Consolidated Subsidiaries on a consolidated basis.
CONSOLIDATED NET INCOME- means for any period, net income of Borrower
and the Consolidated Subsidiaries determined on a consolidated basis in
accordance with GAAP.
CONSOLIDATED SUBSIDIARY- or "CONSOLIDATED SUBSIDIARIES" means, for any
person, at any time, any Subsidiary or other entity the accounts of which would
be consolidated with those of that Person into its consolidated financial
statements as of that time.
CONSOLIDATED TANGIBLE NET WORTH- means, for any Person as of any date,
the consolidated shareholder's equity of such Person and its Consolidated
Subsidiaries which would be reflected on a consolidated balance sheet for such
Person and its Consolidated Subsidiaries prepared as of such date in accordance
with GAAP less the consolidated Intangible Assets of such Person as of such
date. For purposes of this definition, "INTANGIBLE ASSETS" means the amount (to
the extent reflected in determining such consolidated shareholder's equity) of
all unamortized debt discount and expense, unamortized deferred charges,
goodwill, patents, trademarks, service marks, trade names, copyrights,
organization expenses, and other intangible items.
DEBT- of any Person means at any date, without duplication, (a) all
obligations of that Person for borrowed money or for the purchase price of
property, (b) all obligations of that Person evidenced by bonds, debentures,
notes, or other similar instruments, (c) all other indebtedness (including
obligations under Capital Leases, other than usual and customary oil and gas
leases) of that Person on which interest charges are customarily paid or
accrued, (d) all Guarantees by that Person, (e) the unfunded or unreimbursed
portion of all letters of credit issued for the account of that Person, (f) any
indebtedness
Amended and Restated Credit Agreement - Page 5
13
or other obligation secured by a Lien on the assets of such Person, whether or
not assumed by such Person, and (g) all liability of that Person as a general
partner of a partnership for obligations of that partnership of the nature
described in (a) through (f) preceding.
DEFAULT- means any condition or event which constitutes an Event of
Default or which with the giving of notice, the lapse of time, or both, would,
unless cured or waived, become an Event of Default.
DETERMINATION- means any Periodic Determination or Special
Determination.
DETERMINATION DATE- means, (i) with respect to any Special
Determination, the date that is 30 days after the date of the applicable Request
for Determination, and (ii) with respect to any Periodic Determination, each
October 1 and April 1, commencing April 1, 2000.
DISTRIBUTION- by any Person, means (a) with respect to any stock issued
by that Person, any limited liability company interest of that Person, or any
partnership interest of that Person, the retirement, redemption, purchase,
re-purchase, or other acquisition for value of any stock, partnership, or
limited liability company interest, (b) the declaration or payment of any cash
dividend or other distribution on or with respect to any stock, partnership, or
limited liability company interest of that Person, and (c) any other payment by
that Person with respect to its stock, partnership, or limited liability company
interest.
DOCUMENTATION AGENT- means Bank of America, N.A., in its capacity as
Documentation Agent for Lenders.
EBITDA- means, for any period, Consolidated Net Income for that period,
PLUS, without duplication and to the extent deducted from revenues in
determining Consolidated Net Income for that period, (a) the aggregate amount of
Consolidated Interest Expense for that period, (b) the aggregate amount of
letter of credit fees paid during that period, (c) the aggregate amount of
income tax expense for that period, (d) all amounts attributable to
depreciation, depletion and amortization for that period, and (e) all non-cash,
extraordinary expenses during that period, and MINUS, without duplication and to
the extent added to revenues in determining Consolidated Net Income for that
period, all non-cash, extraordinary income during that period, in each case
determined in accordance with GAAP.
ERISA- means the Employee Retirement Income Security Act of 1974, as
amended from time to time, and the regulations and published interpretations
thereof.
6
14
ENVIRONMENTAL LAWS- means any and all laws, rules, orders, regulations,
statutes, ordinances, codes, decrees, or other legally enforceable requirement
(including, without limitation, common law) of any foreign government, the
United States, or any state, local, municipal or other governmental authority,
regulating, relating to or imposing liability or standards of conduct concerning
protection of the environment or of human health as it relates to the
environment, as has been, is now, or may at any time hereafter be, in effect.
EQUITY- means shares of capital stock or a partnership, profits,
capital or member interest, or options, warrants or any other right to
substitute for or otherwise acquire the capital stock or a partnership, profits,
capital or member interest of any Person.
EURODOLLAR BASE RATE- applicable to any Interest Period means the rate
per annum determined by Administrative Agent (rounded upward, if necessary, to
the next higher 1/64 of 1%) at which deposits in dollars are offered to
Administrative Agent by first class banks in the eurodollar interbank market
selected by Administrative Agent as of the first day of the Interest Period in
an amount approximately equal to the principal amount of the Eurodollar Loan to
which the Interest Period is to apply and for a period of time comparable to the
Interest Period.
EURODOLLAR LOAN- means a Loan bearing interest with reference to the
Eurodollar Rate; each Eurodollar Loan having a different Interest Period shall
be deemed to be a separate Eurodollar Loan.
EURODOLLAR RATE- means, with respect to each day during each Interest
Period pertaining to a Eurodollar Loan, a rate per annum equal to the quotient
obtained (rounded upward, if necessary to the next higher 1/64 of 1%) by
dividing (i) the applicable Eurodollar Base Rate by (ii) 1.00, minus the
Eurodollar Reserve Percentage, adjusted automatically on and as of the effective
date of any change in the Eurodollar Reserve Percentage.
EURODOLLAR RESERVE PERCENTAGE- means, for any day as applied to a
Eurodollar Loan, that percentage (expressed as a decimal) which is in effect on
that day, as prescribed by the Board of Governors of the Federal Reserve System
or other Governmental Authority having jurisdiction with respect thereto for
determining the maximum reserve requirement for a member bank of the Federal
Reserve System, in respect of "Eurocurrency liabilities" (or in respect of any
other category of liabilities which includes deposits by reference to which the
Eurodollar Rate is determined or any category of extension of credit or other
assets that include Eurodollar Loans).
EVENT OF DEFAULT- means any of the events specified in SECTION
8.01.
EXISTING CREDIT AGREEMENT- has the meaning given that term in the
recitals hereto.
Amended and Restated Credit Agreement - Page 7
15
EXISTING MORTGAGE AMENDMENT- means one or more Amendments to Mortgages,
UCC-3 Amendments and other documents, instruments, and agreements in form and
substance acceptable to Administrative Agent to be entered into by and among
Borrower or the pertinent Subsidiaries and Bank One, Texas, N.A. in its capacity
as Administrative Agent, pursuant to which the Existing Mortgages shall be
modified, amended, renewed, and extended to (a) reflect the renewal, extension,
amendment, and modification of the Existing Rights and Obligations pursuant to
this Agreement, and (b) to secure the Obligations as defined herein.
EXISTING MORTGAGES- means the mortgages, deeds of trust, security
agreements, financing statements and assignments of production executed by
Borrower and its Subsidiaries in favor of Bank One, Texas, N.A. as
Administrative Agent under the Existing Credit Agreement to secure the Existing
Rights and Obligations.
EXISTING MORTGAGED PROPERTIES- means the oil and gas properties owned
by Borrower and its Subsidiaries which are subject to the Liens created by the
Existing Mortgages to secure the Existing Rights and Obligations.
EXISTING RIGHTS AND OBLIGATIONS- has the meaning given that term in the
recitals hereto.
FEDERAL FUNDS RATE- means, as of any date, the rate per annum (rounded
upwards, if necessary to the nearest 1/100 of 1%) 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 that date, as published by
the Federal Reserve Bank of New York on the Business Day next succeeding that
date, PROVIDED THAT (i) if the day for which that rate is to be determined is
not a Business Day, the Federal Funds Rate for that day shall be the rate on
such transactions on the next preceding Business Day, as so published on the
next succeeding Business Day, and (ii) if no such rate is so published on the
next succeeding Business Day, the Federal Funds Rate for that day shall be the
average rate charged to Administrative Agent on that day on such transactions as
determined by Administrative Agent.
GAAP- means generally accepted accounting principles, applied on a
consistent basis, as set forth in Opinions of the Accounting Principles Board of
the American Institute of Certified Public Accountants or in statements of the
Financial Accounting Standards Board or their respective successors and which
are applicable in the circumstances as of the date in question (accounting
principles are applied on a "consistent basis" when the accounting principles
observed in a current period are comparable in all material respects to those
accounting principles applied in a preceding period).
GLEP- has the meaning given that term in the recitals hereto.
8
16
GLEP TRANSACTION- means, collectively, the (i) transaction contemplated
by a Letter of Intent dated June 23, 1999, between Borrower and FirstEnergy,
Inc., by which Borrower or its Subsidiaries, as appropriate, will contribute the
Appalachian Properties to GLEP for an equity interest in GLEP equal to 50%, and
(ii) the funding of GLEP's $275,000,000 credit facility.
GOVERNMENTAL AUTHORITY- means any nation or government, any state or
other political subdivision thereof, and any entity exercising executive,
legislative, judicial, regulatory, or administrative functions of or pertaining
to government.
GUARANTEE- by any Person means any obligation, contingent or otherwise,
of that Person directly or indirectly guaranteeing any Debt or other obligation
of any other Person and, without limiting the generality of the foregoing, any
obligation, direct or indirect, contingent or otherwise, of that Person (a) to
purchase or pay (or advance or supply funds for the purchase or payment of) such
Debt or other obligation (whether arising by virtue of partnership arrangements,
by agreement to keep-well, to purchase assets, goods, securities or services, to
take-or-pay, or to maintain financial statement conditions, by "comfort letter"
or other similar undertaking of support or otherwise) or (b) entered into for
the purpose of assuring in any other manner the obligee of such Debt or other
obligation of the payment thereof or to protect the obligee against loss in
respect thereof (in whole or in part), PROVIDED THAT the term Guarantee shall
not include endorsements for collection or deposit in the ordinary course of
business.
GUARANTY AGREEMENT- means a Guaranty Agreement substantially in the
form of EXHIBIT B attached hereto (with applicable conforming changes) to be
executed by each existing and future Subsidiary of Borrower (excluding REFC), in
favor of Lenders, pursuant to which each such Subsidiary guarantees payment and
performance in full of the Obligations.
HEDGE TRANSACTIONS- means any commodity, interest rate, currency or
other swap, option, collar, futures contract, advance payment contract or other
contract pursuant to which a Person ▇▇▇▇▇▇ risks related to commodity prices,
interest rates, currency exchange rates, securities prices or financial market
conditions. Hedge Transactions expressly include Oil and Gas Hedge Transactions.
INDENTURE- means that certain Indenture dated as of March 14, 1997, by
and between Borrower and Fleet National Bank, as Trustee, which Indenture sets
forth certain terms applicable to the Subordinate Notes.
Amended and Restated Credit Agreement - Page 9
17
INITIAL BORROWING BASE- means a Borrowing Base in the amount of
$160,000,000, which shall be in effect during the period commencing on the
Closing Date and continuing until the April 1, 2000, Periodic Determination.
INITIAL RESERVE REPORT- means the Post-Divestiture Reserve Summary as
of June 30, 1999, prepared by Borrower for its Southwest and Gulf Coast Business
Units.
INTELLECTUAL PROPERTY- has the meaning given that term in SECTION
7.02(Q).
INTEREST PERIOD- means, with respect to each Eurodollar Loan, the
period commencing on the date that Loan is made and ending one, two, three, six,
nine, or twelve months thereafter, subject to availability, as Borrower may
elect, PROVIDED THAT:
(i) any Interest Period which would otherwise end
on a day which is not a Business Day shall be extended to the next succeeding
Business Day unless that Business Day falls in another calendar month, in which
case the Interest Period will end on the next preceding Business Day;
(ii) any Interest Period which begins on the last
Business Day of a calendar month (or on a day for which there is no numerically
corresponding day in the calendar month at the end of the Interest Period) will,
subject to clause (iii) below, end on the last Business Day of a calendar month;
(iii) if any Interest Period includes a date on which
any payment of principal of the Loan is required to be made hereunder, but does
not end on that date, then (A) the principal amount of each Eurodollar Loan
required to be repaid on that date shall have an Interest Period ending on that
date and (B) the remainder of the Eurodollar Loan shall have an Interest Period
determined as set forth above; and
(iv) No Interest Period shall extend past the
Termination Date.
INVESTMENT- means, with respect to any Person, any capital contribution
to, investment in, or purchase of the stock securities of, or interests in, any
other Person.
ISSUING LENDER- means any Agent selected by Borrower, in its capacity
as issuer of a Letter of Credit.
LENDER- means any financial institution listed on SCHEDULE 1 hereto as
having a Commitment, and its successors and assigns, and "LENDERS" shall mean
all Lenders.
LENDER TERMINATION DATE- has the meaning given that term in SECTION
10.10.
10
18
LENDING OFFICE- means, with respect to any Lender, for each type of
Loan, the Lending Office of that Lender (or of an affiliate of that Lender)
designated for that type of Loan on the signature pages hereof or another office
of that Lender (or of an affiliate of that Lender) as that Lender may from time
to time specify to Borrower and Administrative Agent as the office at which its
Loans of that type are to be made and maintained.
LETTER OF CREDIT- means a letter of credit issued for the account of
Borrower pursuant to SECTION 3.01(a).
LETTER OF CREDIT APPLICATION- has the meaning given this term in
SECTION 3.02.
LETTER OF CREDIT OUTSTANDINGS- means, at any time, the sum of (a) the
aggregate amount available for drawing under Letters of Credit then outstanding
and (b) the aggregate amount of all drawings under Letters of Credit which have
not been reimbursed.
LETTER OF CREDIT PARTICIPATING INTEREST- means with respect to any
Letter of Credit (a) in the case of the Issuing Lender with respect thereto, its
interest in the Letter of Credit and any Letter of Credit Application relating
thereto after giving effect to the granting of participating interests therein,
if any, pursuant hereto and (b) in the case of each Lender, its undivided
participating interest in the Letter of Credit and any Letter of Credit
Application relating thereto.
LIEN- means with respect to any asset, any mortgage, lien, pledge,
charge, security interest, or encumbrance of any kind in respect of the asset.
For the purposes of this Agreement, Borrower and its Subsidiaries shall be
deemed to own subject to a Lien any asset which is acquired or held subject to
the interest of a vendor or lessor under any conditional sale agreement, Capital
Lease, or other title retention agreement relating to the asset.
LOAN- means a loan made pursuant to SECTION 2.01, which can be either
an ABR Loan or a Eurodollar Loan, and "LOANS" means ABR Loans and Eurodollar
Loans and any combination thereof.
LOAN DOCUMENTS- means this Agreement, the Notes, the Mortgages, the
Letter of Credit Applications, the Security Documents, and all other
certificates, documents or instruments delivered in connection with this
Agreement, as they may be amended from time to time.
Amended and Restated Credit Agreement - Page 11
19
LOAN PARTIES- means Borrower and each Subsidiary of Borrower which is
now or hereafter becomes a party to a Loan Document.
MANAGING AGENT- means Bankers Trust Company, in its capacity as
Managing Agent for Lenders.
MAJORITY LENDERS- means at any time Lenders whose Commitment
Percentages aggregate at least 66.67%.
MATERIAL ADVERSE EFFECT- means any circumstance or event that has had
or would be reasonably likely to have a material adverse effect on (a) the
validity or enforceability of any of the Loan Documents or the rights or
remedies of Administrative Agent, any other Agent, or Lenders hereunder, (b) the
business, assets, property, or condition (financial or otherwise) of Borrower
and its Subsidiaries taken as a whole, (c) the ability of Borrower or any
Subsidiary of Borrower to perform any of its obligations or substantially all of
its Obligations under the Loan Documents.
MAXIMUM LAWFUL RATE- means, for each Lender, the maximum rate (or, if
the context so permits or requires, an amount calculated at such rate) of
interest which, at the time in question would not cause the interest charged on
the portion of the Loans owed to that Lender at such time to exceed the maximum
amount which that Lender would be allowed to contract for, charge, take,
reserve, or receive under applicable law, taking into account to the extent
required under applicable law, any and all relevant payments or charges under
the Loan Documents. To the extent the laws of the State of Texas are applicable
for purposes of determining the "Maximum Lawful Rate," such term shall mean the
"indicated rate ceiling" from time to time in effect under Article 1.04, Title
79, Revised Civil Statutes of Texas, 1925, as amended, or, if permitted by
applicable law and effective upon the giving of the notices required by such
Article 1.04 (or effective upon any other date otherwise specified by applicable
law), the "quarterly ceiling" or "annualized ceiling" from time to time in
effect under such Article 1.04, whichever Administrative Agent (with the
approval of Majority Lenders) shall elect to substitute for the "indicated rate
ceiling," and VICE VERSA, each such substitution to have the effect provided in
such Article 1.04, and Administrative Agent (with the approval of Required
Lenders) shall be entitled to make such election from time to time and one or
more times and, without notice to Borrower, to leave any such substitute rate in
effect for subsequent periods in accordance with SUBSECTION (h)(1) of such
Article 1.04.
MORTGAGED PROPERTIES- means Borrower's Oil and Gas Properties that are
now or hereafter become subject to Mortgages.
MORTGAGES- means each mortgage, deed of trust, security agreement,
financing statement, assignment, and each other document and instrument
(including division and
12
20
transfer orders), previously granted or hereafter granted to Administrative
Agent, for the ratable benefit of each Lender, to secure repayment of the
Obligations (including, without limitation, the Existing Mortgages), as amended,
modified, or supplemented from time to time.
MULTIEMPLOYER PLAN- means a Plan described in Section 4001(a)(3) of
ERISA.
NET CASH PROCEEDS- means (a) with respect to the sale, transfer, lease
or other disposition of any asset by Borrower or any Subsidiary, an amount
certified in reasonable detail by an Authorized Officer of Borrower to Lenders
as the excess, if any, of (i) the sum of cash and cash equivalents received in
connection with such sale, transfer, lease or other disposition over (ii) the
sum of (A) amounts placed in escrow or held as a reserve, in accordance with
GAAP, against any liabilities associated with the sale or disposition (except
that, to the extent and as of the time any of the amounts is released from the
reserve, the amounts shall constitute Net Cash Proceeds), and (B) the reasonable
out-of-pocket expenses actually incurred by Borrower or its Subsidiary in
connection with the sale, transfer, lease or other disposition, and (b) with
respect to the sale or issuance of any Equity by Borrower or any Subsidiary, an
amount certified in reasonable detail by an Authorized Officer of Borrower to
Lenders as the difference of (i) the sum of the cash and cash equivalents
received in connection with the sale or issuance minus, without duplication,
(ii) the underwriting discounts and commissions (if any) and other reasonable
fees, out-of-pocket expenses, and other costs actually incurred by Borrower or
the Subsidiary in connection with the sale or issuance and (c) with respect to
the incurrence of Debt by Borrower or any Subsidiary, an amount certified in
reasonable detail by an Authorized Officer of Borrower to Lenders as the excess
of (i) the sum of the cash and cash equivalents received in connection with the
incurrence of Debt over (ii) the reasonable fees, out-of-pocket expenses, and
other costs actually incurred by Borrower or any Subsidiary in connection with
the incurrence of Debt.
NOTE- means, for each Lender, the promissory note evidencing Loans made
by such Lender hereunder and any renewals, extensions, or modifications of it,
and "NOTES" means all of such Notes.
NOTICE OF BORROWING- has the meaning given that term in SECTION 2.02.
NOTICE OF TERMINATION- has the meaning given that term in SECTION
10.10.
OBLIGATIONS- means, collectively, all present and future indebtedness,
obligations and liabilities, and all renewals and extensions thereof, or any
part thereof, of Borrower or any of its Subsidiaries to any Lender or to any
Affiliate of any Lender (a) arising pursuant to the Loan Documents, and all
interest accrued thereon and costs, expenses, and attorneys' fees incurred in
the enforcement or collection thereof, and (b) arising
Amended and Restated Credit Agreement - Page 13
21
under or in connection with any Hedge Transaction entered into between Borrower
or any Subsidiary and any Lender or any Affiliate of any Lender, regardless of
whether the indebtedness, obligations and liabilities are direct, indirect,
fixed, contingent, liquidated, unliquidated, joint, several or joint and
several.
OIL AND GAS HEDGE TRANSACTIONS- means transactions providing for the
hedging, forward sale, or swap of crude oil or natural gas by Borrower or its
Subsidiaries (excluding REFC).
OUTSTANDING OBLIGATIONS- means, at any time, the sum of the aggregate
principal amount of the Loans and the Letter of Credit Outstandings.
PBGC- means the Pension Benefit Guaranty Corporation established
pursuant to Subtitle A of Title IV of ERISA, or any entity succeeding to any or
all of its functions under ERISA.
PARTICIPATING LENDER- means with respect to any Letter of Credit, any
Lender (other than the Issuing Lender with respect to such Letter of Credit)
with respect to its Letter of Credit Participating Interest.
PERIODIC DETERMINATION- means any Determination of the Borrowing Base
pursuant to SECTION 4.02.
PERMITTED ENCUMBRANCES- means with respect to any asset:
(a) Liens securing the Obligations in favor of Lenders;
(b) Minor defects in title which do not secure the payment of
money and otherwise have no material adverse effect on the value or operation of
oil and gas properties, and for the purposes of this Agreement, a minor defect
in title shall include (i) those instances where record title to an oil and gas
lease is in a predecessor in title to Borrower or any of its Subsidiaries, but
where Borrower or any of its Subsidiaries, by reason of a farmout or other
instrument is presently entitled to receive an assignment of its interest or
other evidence of title and the appropriate Person is proceeding diligently to
obtain the assignment, and (ii) easements, rights-of-way, servitudes, permits,
surface leases and other similar rights in respect of surface operations, and
easements for pipelines, streets, alleys, highways, telephone lines, power
lines, railways, and other easements and rights-of-way, on, over or in respect
of any of the properties of Borrower (or its Subsidiaries, as applicable) that
are customarily granted in the oil and gas industry; so long as, with respect to
any of the minor defects in title, the same are minor defects which are
customary and usual in the oil and gas industry and which are customarily
accepted by a reasonably prudent operator dealing with its properties;
14
22
(c) Inchoate statutory or operators' liens which are not
delinquent securing obligations for labor, services, materials, and supplies
furnished to oil and gas properties;
(d) Mechanic's, materialmen's, warehouseman's, journeyman's
and carrier's liens, and other similar liens arising by operation of law or
statute or incident to the exploration, development, operation, and maintenance
of oil and gas properties, each of which arises in the ordinary course of
business and is in respect of obligations that have not been outstanding more
than 90 days or which are being contested in good faith by appropriate
proceedings and for which adequate reserves have been maintained in accordance
with GAAP;
(e) Production sales contracts, gas balancing agreements, and
joint operating agreements entered into in the ordinary course of business and
which do not involve any advance payments for production to be produced at a
later date; PROVIDED THAT the amount of all gas imbalances known to any
Authorized Officer of Borrower shall have been disclosed or otherwise taken into
account in the Reserve Reports delivered to Lenders hereunder;
(f) Liens for Taxes or other assessments not yet due or not
yet delinquent, or, if delinquent, that are being contested in good faith in the
normal course of business by appropriate action for which adequate reserves have
been established;
(g) All rights to consent by, required notices to, filings
with, or other actions by, Governmental Authorities in connection with the sale
or conveyance of oil and gas leases or interests therein if Borrower (or its
Subsidiaries, if applicable) is entitled to such consent, the same are
customarily obtained subsequent to the sale or conveyance, and the appropriate
Person is proceeding diligently to obtain the consent, notice or filing;
(h) The terms and provisions of any of the oil and gas leases
pursuant to which Borrower (or its Subsidiaries, as applicable) derives its
interests;
(i) Lease burdens payable to third parties which are deducted
in the calculation of discounted present value in the Reserve Reports including,
without limitation, any royalty, overriding royalty, net profits interest,
production payment, carried interest, or reversionary working interest and which
have been disclosed to Administrative Agent in writing; PROVIDED, HOWEVER, THAT
Borrower shall not be required to disclose the lease burdens unless they are not
customarily and usually found in the oil and gas industry or unless they
obligate Borrower, or a Subsidiary, as applicable, in a fashion not customarily
and usually found in the oil and gas industry;
(j) All applicable laws, rules, and orders of Governmental
Authorities having jurisdiction of the affairs of Borrower or a Subsidiary; and
Amended and Restated Credit Agreement - Page 15
23
(k) Liens securing Debt incurred to finance the acquisition of
the assets which are the subject of the Liens to the extent such Debt is
permitted by SECTION 7.03(b)(2).
PERMITTED INVESTMENTS- means with respect to Borrower and its
Subsidiaries: (a) Investments by Borrower in its Subsidiaries (excluding REFC)
or by its Subsidiaries in other Subsidiaries (excluding REFC) or in Borrower;
(b) Investments in (1) direct obligations of the United States or any agency
thereof with maturities of one year or less from the date of acquisition; (2)
commercial paper of a domestic issuer rated at least "A-1" by Standard & Poor's
Corporation or "P-1" by ▇▇▇▇▇'▇ Investor Service, Inc.; (3) certificates of
deposit with maturities of one year or less from the date of acquisition issued
by any commercial bank which is a member of the Federal Reserve System and has
combined capital and surplus and undivided profits of not less than
$1,000,000,000; (4) Equity, obligations, or securities received in settlement of
debts (created in the ordinary course of business) owing to Borrower or any
Subsidiary; and (5) Oil and Gas Hedge Transactions permitted by SECTION 7.03(i);
and (c) Investments in Equity of publicly traded companies, PROVIDED THAT the
aggregate cost of all Investments which are outstanding pursuant to this clause
(c) at any time shall not exceed an amount equal to 10% of the Borrowing Base in
effect at such time.
PERSON- means an individual, corporation, partnership, association,
business trust, joint stock company, trust, unincorporated association, joint
venture, or any other entity or organization, including a government or
political subdivision or an agency or instrumentality thereof.
PLAN- means, at a particular time, any employee benefit pension plan
which is subject to Title IV of ERISA and in respect of which Borrower or a
Commonly Controlled Entity is (or, if such plan were terminated at that time,
would under Section 4069 of ERISA be deemed to be) an "employer" as defined in
Section 3(5) of ERISA.
PLEDGE AGREEMENT- means a Pledge Agreement substantially in the form of
EXHIBIT C attached hereto (with applicable conforming changes) to be executed by
Borrower and each existing Subsidiary (excluding REFC) and any future Subsidiary
of Borrower (to the extent any such Subsidiary owns any outstanding Equity of
another Subsidiary of Borrower), pursuant to which Borrower or such Subsidiary
shall pledge to Administrative Agent, for the ratable benefit of Lenders, all of
the issued and outstanding Equity of any Subsidiary owned by such Person to
secure the Obligations.
PREFERRED STOCK- means Borrower's Series C Convertible Preferred Stock
containing the rights and preferences set forth in, and issued pursuant to, the
Preferred Stock Designation.
16
24
PREFERRED STOCK DESIGNATION- means the Certificate of Designation of
Rights and References of Series C Preferred Stock filed with the Secretary of
State of Delaware on or about November 1, 1995, setting forth the rights and
preferences of the Preferred Stock.
PRESENT VALUE- means pre-tax value, discounted at 10%, of future net
cash flows from estimated proved reserves, calculated holding prices and costs
constant at amounts in effect on the date of the Reserve Report (unless such
prices or costs are subject to change pursuant to contractual provisions) and
otherwise in accordance with the Securities and Exchange Commission's rules for
inclusion of oil and gas reserve information in financial statements filed with
the Commission.
PROHIBITED TRANSACTION- means any transaction set forth in Section 406
of ERISA or Section 4975 of the Code.
PROPERTY DISPOSITION- has the meaning given that term in SECTION
7.03(c).
REFC- means Range Energy Finance Corporation, a Delaware corporation.
REFC GUARANTEE- means a Guarantee by Borrower of up to $50,000,000 in
the aggregate of REFC's Debt or other obligations owed to REFC's lender
effective only in the event of a failure of title to an interest (i) acquired by
REFC from a third party to whom REFC has provided financing and (ii) considered
by REFC's lender for purposes of determining REFC's borrowing base.
REPLACEMENT LENDERS- has the meaning given that term in SECTION 10.10.
REPORTABLE EVENT- means any of the events set forth in Section 4043(b)
of ERISA, other than those events as to which the thirty day notice period is
waived under subsections .13, .14, .16, .18, .19, or .20 of PBGC Reg.
'2615.
REQUEST FOR DETERMINATION- means Borrower's or Required Lenders'
request for a Special Determination of the Borrowing Base made pursuant to
SECTIONS 4.03 or 4.04.
REQUEST FOR LETTER OF CREDIT- has the meaning given that term in
SECTION 3.02.
REQUIRED LENDERS- means, at any time, Lenders whose Commitment
Percentages aggregate at least 75%.
Amended and Restated Credit Agreement - Page 17
25
RESERVE REPORT- means an engineering analysis of Borrower's Oil and Gas
Properties (or properties proposed to be acquired by Borrower or one or more of
its Subsidiaries) in form and substance acceptable to Required Lenders prepared
by independent petroleum engineers acceptable to Required Lenders in accordance
with customary and prudent practices in the petroleum engineering industry and
Financial Accounting Standards Board Statement 69, which designates the owner of
each asset that is the subject of the Reserve Report.
RESTRICTED PAYMENT- means (a) any Distribution by Borrower or any
Subsidiary of Borrower to any Person other than Borrower or another wholly-owned
Subsidiary of Borrower, (b) any Distribution by Borrower or any subsidiary of
Borrower to REFC, (c) the issuance of a Guarantee by Borrower or a Subsidiary of
Borrower with respect to any Debt or other obligation of Borrower or any
Subsidiary (excluding (i) any Guarantee by a Subsidiary with respect to any Debt
or other obligation of Borrower or any Subsidiary of Borrower incurred in
connection with the Subordinate Notes, or any renewal, amendment, refinancing,
rearrangement, modification, or restatement thereof on terms and conditions
similar in all material respects to the notes issued pursuant to such offering
and (ii) the REFC Guarantee), and (d) the retirement, redemption, or prepayment
prior to the scheduled maturity by Borrower or any Subsidiary of Borrower of its
Subordinated Debt.
ROLLOVER NOTICE- has the meaning given that term in SECTION 2.07.
SECURITY DOCUMENTS- means the collective reference to the Guaranty
Agreement(s), the Pledge Agreement(s), the Security Agreement(s), the Mortgages,
and all other security documents hereafter delivered to Administrative Agent
granting a Lien on any asset or assets of any Person to secure the Obligations
and liabilities of Borrower hereunder and under any of the other Loan Documents
or to secure any guarantee of any the obligations and liabilities.
SENIOR DEBT- means, at any time outstanding, all Debt of Borrower and
its Subsidiaries except Subordinated Debt.
SPECIAL ACCOUNTS- means a Person's revenue distribution accounts and
other accounts at a Lender which are not solely for the benefit of that Person;
PROVIDED THAT accounts for the benefit of Borrower and one or more of its
Subsidiaries or for one or more Subsidiaries shall not be a "Special Account"
for purposes of this Agreement.
SPECIAL DETERMINATION- means any determination of the Borrowing Base
pursuant to SECTIONS 4.03 or 4.04.
STERLING GAS PLANT- means the gas processing plant located in Sterling
County, Texas, owned by Range Pipeline Systems, L.P., and all pipelines,
gathering systems, and other similar assets owned by such Person, including
related personal property and other
18
26
fixed assets and all related servitudes, and similar real property interests
owned by such Person.
SUBORDINATE NOTES- means those certain 8.75% Senior Subordinate Notes
due January 15, 2007, as the same are more particularly described in the
Indenture.
SUBORDINATED DEBT- means Debt incurred by Borrower, the repayment of
which is subordinate (in a manner acceptable to Required Lenders, as evidenced
by their written approval) to Borrower's repayment of the Obligations, including
(a) notes created upon the exchange of Borrower's convertible exchangeable
Preferred Stock outstanding as of the Closing Date, (b) Debt under Borrower's 6%
convertible subordinated debentures due 2007, and (c) Debt incurred by Borrower
in accordance with the Subordinate Notes.
SUBSIDIARY- means, for any Person, any corporation, partnership,
limited liability company, or other entity of which securities or other
ownership interests having ordinary voting power to elect a majority of the
board of directors or other persons performing similar functions (including that
of a general partner) are at the time directly or indirectly owned,
collectively, by such Person and any Subsidiaries of such Person. The term
Subsidiary shall include Subsidiaries of Subsidiaries (and so on).
SYNDICATION AGENT- means Chase Bank of Texas, N.A., in its capacity as
Syndication Agent for Lenders.
TAXES- means all taxes, assessments, filing or other fees, levies,
imposts, duties, deductions, withholdings, stamp taxes, interest equalization
taxes, capital transaction taxes, foreign exchange taxes or other charges, or
other charges of any nature whatsoever, from time to time or at any time imposed
by law or any federal, state or local governmental agency. "TAX" means any one
of the foregoing.
TERMINATED LENDER- has the meaning given that term in SECTION 10.10.
TERMINATION DATE- means February 14, 2003.
TOTAL COMMITMENT- means the Commitments of Lenders in an initial
aggregate amount of $225,000,000, as that amount may be reduced from time to
time pursuant to the terms of this Agreement.
TOTAL DEBT- means, at any time outstanding, all Debt of Borrower and
its Subsidiaries.
UNUSED AVAILABILITY- means, at any time during the Commitment Period,
the remainder of (i) the Borrowing Base at that time, minus (ii) the Outstanding
Obligations.
Amended and Restated Credit Agreement - Page 19
27
YEAR 2000 PROBLEM- has the meaning given that term in SECTION 7.01(v).
1.02. OTHER DEFINITIONAL PROVISIONS. Other terms are defined within
this agreement. All definitions contained in this Agreement are equally
applicable to the singular and plural forms of the terms defined. The words
"hereof", "herein", and "hereunder" and words of similar import referring to
this Agreement refer to this Agreement as a whole and not to any particular
provision of this Agreement. Unless otherwise specified, all Article and Section
references pertain to this Agreement. All accounting terms not specifically
defined herein shall be construed in accordance with GAAP. All petroleum terms
used herein have the meanings given them from time to time and at the time in
question by the Society of Professional Engineers of the American Institute of
Mining Engineers. Terms used herein that are defined in the Uniform Commercial
Code as adopted by the State of Texas, unless otherwise defined herein, shall
have the meanings specified in the Uniform Commercial Code as adopted by the
State of Texas.
ARTICLE 2 - AMOUNT AND TERMS OF COMMITMENTS.
2.01. COMMITMENTS. (a) Subject to the terms and conditions hereof, each
Lender severally agrees to make revolving loans (the "LOANS") to Borrower from
time to time during the Commitment Period in an aggregate principal amount not
to exceed at any one time outstanding the amount of that Lender's Commitment
reduced by an amount equal to that Lender's Participating Interests in Letters
of Credit then outstanding; PROVIDED THAT no Lender will make Loans if, after
giving effect thereto, the Outstanding Obligations would exceed the lesser of
(i) the Total Commitment or (ii) the Borrowing Base then in effect. During the
Commitment Period, Borrower may use the Commitments by borrowing, prepaying the
Loans in whole or in part, and reborrowing all in accordance with the terms and
conditions hereof.
(b) The Loans may be outstanding as ABR Loans or Eurodollar Loans or a
combination thereof, as determined by Borrower and notified to Administrative
Agent in accordance with SECTIONS 2.02 and 2.07; PROVIDED THAT no Loan shall be
made as a Eurodollar Loan after the day that is one month before the Termination
Date. Each type of Loan shall be made and maintained at each Lender's Lending
Office for that type of Loan. The failure of any Lender to make any requested
Loan to be made by it on the Borrowing Date specified for that Loan shall not
relieve the other Lenders of their obligation (if any) to make Loans on that
date, but no Lender shall be responsible for the failure of the other Lenders to
make Loans to be made by the other Lender. Each Borrowing shall (i) be in a
minimum principal amount of $1,000,000 or any larger integral multiple of
$100,000 (except that any ABR Loan may be in the amount of the unused portion of
the Total Commitment) and (ii) be made from each Lender ratably in accordance
with its respective Commitment Percentage. Notwithstanding any provision
20
28
of this Agreement or the Loan Documents to the contrary, on the Closing Date and
continuously until repayment in full of all Loans or the termination of this
Agreement, whichever occurs first, there shall be and remain outstanding Loans
of not less than $1,000, the balance of which may not be prepaid.
2.02. PROCEDURE FOR BORROWING. (a) To request a Borrowing hereunder,
Borrower shall hand deliver or telecopy to Administrative Agent a Notice of
Borrowing in the form of EXHIBIT D hereto (a "NOTICE OF BORROWING") prior to
1:00 p.m. (Dallas, Texas time) at least one Business Day before the requested
Borrowing Date of each ABR Borrowing, and at least three Business Days before
the Borrowing Date of each Eurodollar Borrowing. Each Notice of Borrowing shall
specify (1) the Borrowing Date; (2) the aggregate amount of the Borrowing
requested; (3) whether such Borrowing is to be an ABR Borrowing or a Eurodollar
Borrowing, and (4) in the case of a Eurodollar Borrowing, the duration of the
Interest Period applicable thereto. Administrative Agent shall promptly notify
each Lender of Borrower's request, and not later than 12:00 noon (Dallas, Texas
time), on the Borrowing Date, each Lender will make available to Administrative
Agent at ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇, in immediately
available funds, that Lender's Commitment Percentage of the aggregate amount of
such Borrowing. After Administrative Agent's receipt of these funds, not later
than 2:00 p.m. (Dallas, Texas time) on the Borrowing Date and upon fulfillment
of the applicable conditions set forth in Article 6, Administrative Agent will
make the proceeds of such Borrowing available to Borrower in immediately
available funds by crediting the amount thereof to Borrower's account with
Administrative Agent.
(b) All notices given by Borrower under this SECTION 2.02
shall be irrevocable and shall be given not later than 1:00 p.m. (Dallas, Texas
time) on a day which is not less than the number of Business Days specified
above for the notice.
2.03. NOTES. (a) All Loans made by each Lender shall be evidenced by,
and repaid with interest in accordance with a single promissory note of Borrower
(a "NOTE"), which shall be (i) in substantially the form of attached EXHIBIT A,
duly completed; (ii) be dated the date hereof; (iii) be in a face amount equal
to that Lender's Commitment; (iv) be payable to the order of that Lender for the
account of its applicable Lending Office; and (v) bear interest in accordance
with SECTION 2.04 hereof. Notwithstanding the principal amount of each Lender's
Note as stated on the face thereof, the amount of principal actually owing on
that Lender's Note at any given time shall be the aggregate of that Lender's
Loans made to Borrower, less all payments of principal actually received by such
Lender. The Loans shall mature on the Termination Date.
Amended and Restated Credit Agreement - Page 21
29
(b) Simultaneously with the execution of this Agreement,
Administrative Agent shall deliver to each Lender the Note payable to that
Lender referenced in SECTION 2.03(a). Each Lender may endorse (and prior to any
transfer of its Note shall endorse) on the schedule attached to the Note held by
that Lender appropriate notations to evidence the date and amount of each Loan
made by it, the Interest Period applicable thereto, and the date and amount of
each payment of principal of any Loan made by Borrower with respect thereto,
PROVIDED THAT the failure by any Lender to so endorse its Note shall not affect
the liability of Borrower for the repayment of all amounts outstanding under the
Note together with interest thereon. Each Lender is hereby irrevocably
authorized by Borrower to endorse its Note and to attach to and make a part of
any Note a continuation of any such schedule as required.
2.04. INTEREST RATES AND PAYMENT DATES. Borrower shall pay interest to
Administrative Agent for the account of each Lender on the outstanding and
unpaid principal amount of that Lender's Loans made under this Agreement at a
rate per annum as follows:
(a) For each ABR Loan, at a rate equal to the sum of the
Adjusted Base Rate in effect from day to day plus the Applicable Margin,
PROVIDED THAT in no event will the rate charged hereunder or under any Note
exceed the Maximum Lawful Rate. Interest which accrues on each ABR Loan shall be
payable in arrears on the first day of January, April, July, and October of each
year.
(b) For each Eurodollar Loan, for the Interest Period
applicable thereto, at a rate equal to the sum of the Eurodollar Rate plus the
Applicable Margin, PROVIDED THAT in no event will the rate charged hereunder or
under any Note exceed the Maximum Lawful Rate. Interest which accrues on each
Eurodollar Loan shall be payable in arrears on the expiration of each applicable
Interest Period and, in the case of any Eurodollar Loan with an Interest Period
of longer than three months, at the expiration of each three-month period during
such Interest Period.
(c) Administrative Agent shall determine each interest rate
applicable to the Loans in accordance with the terms hereof. Administrative
Agent shall promptly notify Borrower and Lenders of each rate of interest so
determined, and its determination thereof shall be conclusive in the absence of
manifest error.
(d) Notwithstanding the foregoing, if at any time the rate of
interest calculated with reference to the Adjusted Base Rate or the Eurodollar
Rate hereunder (the "CONTRACT RATE") is limited to the Maximum Lawful Rate, any
subsequent reductions in the contract rate shall not reduce the rate of interest
on the affected Loan below the Maximum Lawful Rate until the total amount of
interest accrued equals the amount of interest which would have accrued if the
contract rate had at all times been in effect. In the event that at maturity
(stated or by acceleration), or at final payment of a Note, the total amount of
interest paid or accrued on such Note is less than the amount of interest
22
30
which would have accrued if the contract rate had at all times been in effect
with respect thereto, then at that time, to the extent permitted by law,
Borrower shall pay to the holder of the Note an amount equal to the difference
between (i) the lesser of the amount of interest which would have accrued if the
contract rate had at all times been in effect and the amount of interest which
would have accrued if the Maximum Lawful Rate had at all times been in effect,
and (ii) the amount of interest actually paid on such Note.
(e) Any change in the interest rate on a Loan resulting from a
change in the Adjusted Base Rate or the Eurodollar Reserve Percentage shall be
effective as of the opening of business on the Business Day on which the change
becomes effective. Interest on the unpaid principal of (i) each Eurodollar Loan
shall be calculated on the basis of the actual days elapsed in a year consisting
of 360 days (except to the extent that such calculation would result in a
usurious rate, in which case a year consisting of 365 or 366 days, as the case
may be, shall be used), and (ii) each ABR Loan shall be calculated on the basis
of the actual days elapsed in a year consisting of 365 days or 366 days, as the
case may be.
(f) Any overdue principal of and, to the extent permitted by
law, overdue interest on any Loan (after giving effect to all grace periods)
shall bear interest payable on demand, for each day until paid at a rate per
annum equal to the lesser of (i) the sum of the Adjusted Base Rate plus 2% and
(ii) the Maximum Lawful Rate.
2.05. NON-RECEIPT OF FUNDS BY ADMINISTRATIVE AGENT. (a) Unless
Administrative Agent receives written notice from a Lender prior to the
Borrowing Date applicable to a Borrowing that such Lender will not make the
amount that would constitute its Commitment Percentage of the Borrowing,
available to Administrative Agent, Administrative Agent may assume that Lender
will make the funds available to Administrative Agent on the Borrowing Date, and
Administrative Agent may, but shall not be obligated to, in reliance upon that
assumption, make available to Borrower on the Borrowing Date a corresponding
amount. If such Lender has not made the funds available to Administrative Agent,
by the required time on the applicable Borrowing Date, that Lender agrees to
repay to Administrative Agent, immediately on demand, the corresponding amount
together with interest thereon, for each day from the date the amount is made
available to Borrower until the date the amount is repaid to Administrative
Agent, at the Federal Funds Rate for three Business Days and thereafter at the
Adjusted Base Rate. If such Lender shall repay to Administrative Agent the
corresponding amount, the amount so repaid shall constitute such Lender's Loan
for purposes of this Agreement. If such Lender does not pay the corresponding
amount immediately upon Administrative Agent's demand therefor, Administrative
Agent shall promptly notify Borrower, and Borrower shall immediately pay the
corresponding amount to Administrative Agent with interest thereon, for each day
from the date the amount is made available to Borrower until the date the amount
is repaid to Administrative Agent, at the rate of interest applicable at the
time to the proposed Loan.
Amended and Restated Credit Agreement - Page 23
31
(b) Unless Administrative Agent receives notice from Borrower
prior to the date on which any payment is due to Lenders hereunder that Borrower
will not make the payment in full, Administrative Agent may assume that Borrower
has made the payment in full to Administrative Agent on that date, and
Administrative Agent in its sole discretion may, but is not be obligated to, in
reliance upon this assumption, cause to be distributed to each Lender on that
due date an amount equal to the amount then due that Lender. If and to the
extent Borrower does not make the payment in full to Administrative Agent, each
Lender shall repay to Administrative Agent immediately on demand the amount
distributed to that Lender together with interest thereon, for each day from the
date the amount is distributed to such Lender until the date the Lender repays
the amount to Administrative Agent, at the Federal Funds Rate for three Business
Days and thereafter at the Adjusted Base Rate.
2.06. USE OF PROCEEDS. The proceeds of the Loans made on or after the
Closing Date shall be used (a) to refinance indebtedness existing as of the
Closing Date of Borrower or any Subsidiary of Borrower excluding REFC; (b) for
payment of capital expenditures, drilling costs, and other expenses incurred by
Borrower and its Subsidiaries excluding REFC in the further development,
exploration, and production of Borrower's Oil and Gas Properties; (c) for
Borrower and its Subsidiaries excluding REFC to purchase additional oil and gas
properties; (d) for working capital and general corporate purposes, but only to
the extent that the use of proceeds for these purposes would be permitted under
the terms of this Agreement; (e) to fund reimbursement obligations with respect
to Letters of Credit; (f) for Permitted Investments, but excluding Equity of
publicly traded companies; and (g) for Restricted Payments permitted under this
Agreement.
2.07. CONVERSIONS AND RENEWALS. Borrower may elect from time to time to
convert all or a part of one type of Loan into another type of Loan or to renew
all or part of a Loan by giving Administrative Agent written notice thereof by
12:00 noon (Dallas, Texas time) at least one Business Day before the conversion
into an ABR Loan and at least three Business Days before the conversion into or
renewal of a Eurodollar Loan, specifying: (a) the renewal or conversion date;
(b) the amount of the Loan to be converted or renewed; and (c) in the case of
conversions, the type of Loan to be converted into; and (d) in the case of
renewals of or a conversion into Eurodollar Loans, the duration of the Interest
Period applicable thereto; PROVIDED THAT (i) the minimum principal amount of all
Eurodollar Loans outstanding and subject to the same Interest Period after a
renewal or conversion shall be $1,000,000 or any larger integral multiple of
$100,000; and (ii) Eurodollar Loans can be converted to ABR Loans only on the
last day of the Interest Period applicable thereto. All notices given by
Borrower under this SECTION 2.07 shall be irrevocable and shall be in the form
of EXHIBIT E hereto (a "ROLLOVER NOTICE"). If Borrower fails to give
Administrative Agent the notice as specified above for the renewal or conversion
of a Eurodollar Loan prior to the end of the Interest Period with respect
thereto, that Eurodollar Loan shall automatically be converted into an ABR Loan
on the last day of the Interest Period for the Loan.
24
32
2.08. LIMITATION ON NUMBER OF EURODOLLAR LOANS. There may be no more
than an aggregate of ten Interest Periods applicable to outstanding Eurodollar
Loans in effect at any time, unless otherwise agreed by Lenders.
2.09. PREPAYMENTS. (a) Borrower may, without premium or penalty, upon
one Business Days' prior written notice to Administrative Agent, prepay the
Notes, in whole or in part, with accrued interest to the date of the prepayment
on the amount prepaid, PROVIDED THAT (i) each prepayment of less than the full
outstanding principal balance of the Notes shall be in a minimum amount equal to
$1,000,000 or any larger integral multiple of $100,000; and (ii) if Borrower
prepays the principal of any Eurodollar Loan on any date other than the last day
of the Interest Period applicable thereto, Borrower shall also pay to Lenders
the amounts specified in SECTION 10.06. Upon receipt of any prepayments,
Administrative Agent will promptly thereafter cause to be distributed the
prepayment to each Lender for the account of its applicable Lending Office in
the proportion that each Lender's Loan to which the prepayment applies bears to
the total amount of all Lenders' Loans to which the prepayment applies.
(b) Borrower shall make a mandatory prepayment on the Loans
(i) simultaneously with any reduction in the Borrowing Base pursuant to SECTION
4.05 hereof in an amount sufficient to eliminate any Borrowing Base Deficiency
resulting from such prepayment, and (ii) at each other time required by SECTION
4.06 hereof as a result of any Borrowing Base Deficiency.
(c) Any voluntary prepayment of a Eurodollar Loan hereunder
shall be (i) made together with interest accrued (through the date of the
prepayment) on the principal amount prepaid and (ii) applied first to accrued
interest and then to principal.
2.10. MANNER AND APPLICATION OF PAYMENTS. (a) All payments of principal
of, and interest on, any Note shall be made by Borrower to Administrative Agent
before 1:00 p.m. (Dallas, Texas time), in federal or other immediately available
funds, at Administrative Agent's office at ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇,
▇▇▇▇▇ ▇▇▇▇▇, for the account of the applicable Lending Office of each Lender.
Should the principal of, or any installment of the principal or interest on, any
Note, or any commitment fee, become due and payable on a day other than a
Business Day, the maturity thereof shall be extended to the next succeeding
Business Day. Whenever any payment to be made under this Agreement or under any
Note shall be stated to be due on a day other than a Business Day, the payment
shall be made on the next succeeding Business Day, and the extension of time
shall be included in the computation of the payment of interest and the
commitment fee, as the case may be, except, in the case of a Eurodollar Loan, if
the result of the extension would be to extend the payment into another calendar
month, the payment shall be made on the immediately preceding Business Day. All
payments made
Amended and Restated Credit Agreement - Page 25
33
under the Loan Documents shall be credited, to the extent of the amount thereof,
in the following manner: (i) first to fees, costs and expenses which Borrower
has agreed to pay under the Loan Documents; (ii) second, against the amount of
interest accrued and unpaid on the Notes as of the date of the payment; (iii)
third, against all principal (if any) due and owing on the Notes as of the date
of the payment; (iv) fourth, as a prepayment of outstanding ABR Loans under the
Notes; (v) fifth, as a prepayment of outstanding Eurodollar Loans under the
Notes; and (vi) sixth, as a prepayment of any remaining Obligation. Subject to
the foregoing, Borrower shall select ABR Loans and Eurodollar Loans to be repaid
in a manner designated to minimize the loss to each Lender, if any, resulting
from the payments; PROVIDED, HOWEVER, THAT if Borrower fails to select the ABR
Loans and Eurodollar Loans to which the payments are to be applied, or if an
Event of Default has occurred and is continuing at the time of the payment, then
each Lender shall be entitled to apply the payment to ABR Loans and Eurodollar
Loans in the manner it shall deem appropriate.
(b) On the Business Day of receipt by Administrative Agent, if
Administrative Agent's receipt occurs before 1:00 p.m. (Dallas, Texas time),
Administrative Agent will promptly thereafter cause to be distributed, on the
same Business Day, (1) the payments of principal and interest in like funds to
each Lender for the account of its applicable Lending Office pro rata according
to the respective outstanding principal amounts of the Loans to which the
payment applies then held by Lenders and (2) other fees payable to any Lender to
be applied in accordance with the terms of this Agreement. All payments received
by Administrative Agent after 1:00 p.m. (Dallas, Texas time) will be distributed
promptly by Administrative Agent, and in no event later than 2:00 p.m. (Dallas,
Texas time) of the next succeeding Business Day. Borrower authorizes each
Lender, if and to the extent payment is not made when due under this Agreement
or under any Note, to charge from time to time against any account of Borrower
with that Lender other than a Special Account any amount as due.
2.11. VOLUNTARY REDUCTION OF COMMITMENT. Borrower may, by notice to
Administrative Agent five Business Days prior to the effective date of any such
reduction, reduce the Total Commitment (and thereby reduce the Commitment of
each Bank ratably) in amounts not less than $1,000,000 and in any amount which
is an integral multiple of $100,000. On the effective date of any such
reduction, Borrower shall, to the extent required as a result of such reduction,
make a principal prepayment on the Loans in an amount sufficient to cause the
Outstanding Obligations to be equal to or less than the Total Commitment as
thereby reduced. Notwithstanding the foregoing, Borrower shall not be permitted
to voluntarily reduce the Total Commitment to an amount less than the Letter of
Credit Outstandings.
ARTICLE 3 - LETTERS OF CREDIT.
26
34
3.01. LETTERS OF CREDIT. (a) Subject to the terms and conditions
hereof, the Issuing Lender selected by Borrower, in reliance on the agreements
of the other Lenders set forth in SECTION 3.04(a), agrees to issue letters of
credit ("LETTERS OF CREDIT") for the account of Borrower on any Business Day
during the Commitment Period in such form as may be approved from time to time
by the Issuing Lender; PROVIDED THAT Issuing Lender shall not issue any Letter
of Credit if, after giving effect to the issuance and after giving effect to any
Borrowing requested to be made or Letters of Credit requested to be issued on
that date, (i) the Letter of Credit Outstandings would exceed $20,000,000 or
(ii) the Outstanding Obligations would exceed the lesser of (x) the Total
Commitment or (y) the Borrowing Base then in effect. Each Letter of Credit shall
(i) be issued to support obligations of Borrower or any of its Subsidiaries
contingent or otherwise, which finance the working capital and business needs of
Borrower and its Subsidiaries, and (ii) shall expire no later than the earlier
of (x) one year after the date of issuance or (y) five Business Days prior to
the Termination Date. Each Letter of Credit shall be denominated in dollars.
(b) Each Letter of Credit shall be subject to the Uniform
Customs and Practice for Documentary Credits (1995 Revision), International
Chamber of Commerce Publication No. 500, as the same may be amended from time to
time, and, to the extent not inconsistent therewith, the laws of the State of
Texas.
(c) The Issuing Lender shall not at any time be obligated to
issue any Letter of Credit hereunder if the issuance would conflict with, or
cause the Issuing Lender or any Participating Lender to exceed any limits
imposed by, any applicable law.
3.02. PROCEDURE FOR ISSUANCE OF LETTERS OF CREDIT. Borrower may from
time to time request that the Issuing Lender issue a Letter of Credit by
delivering to the Issuing Lender and Administrative Agent at their respective
addresses for notices specified herein a Request for Letter of Credit in the
form of EXHIBIT F hereto, together with a letter of credit application in the
Issuing Lender's then customary form (a "LETTER OF CREDIT APPLICATION")
completed to the satisfaction of the Issuing Lender, and the other certificates,
documents, and other papers and information as may be customary and as the
Issuing Lender may reasonably request. Upon receipt of any Letter of Credit
Application, the Issuing Lender will process the Letter of Credit Application
and the certificates, documents, and other papers and information delivered to
it in connection therewith in accordance with its customary procedures and, upon
receipt by the Issuing Lender of confirmation from Administrative Agent that
issuance of the Letter of Credit will not contravene SECTION 3.01, the Issuing
Lender shall promptly issue the Letter of Credit requested thereby (but in no
event shall the Issuing Lender be required to issue any Letter of Credit earlier
than three Business Days after its receipt of the Letter of Credit Application
therefor and all certificates, documents, and other papers and information
relating thereto) by issuing the original of the Letter of Credit to the
beneficiary thereof or as otherwise may be agreed by the Issuing Lender and
Borrower. The Issuing Lender
Amended and Restated Credit Agreement - Page 27
35
shall furnish a copy of the Letter of Credit to Borrower and Administrative
Agent promptly following the issuance thereof, and, thereafter, Administrative
Agent shall promptly furnish a copy thereof to Lenders.
3.03. FEES, COMMISSIONS, AND OTHER CHARGES. (a) Borrower shall pay to
Administrative Agent, for the account of the Issuing Lender and the
Participating Lenders, a letter of credit commission with respect to each Letter
of Credit on the average daily aggregate amount available to be drawn under such
Letter of Credit during the relevant period equal to the greater of (x) $500 or
(y) an amount calculated for the period from the date the Letter of Credit is
issued to the date upon which the payment is due under this SECTION 3.03 (and,
thereafter, from the date of prior payment under this SECTION 3.03 to the date
upon which the payment is due under this section) at a rate per annum equal to
the Applicable Margin in effect on the date such payment is due with respect to
Eurodollar Loans MINUS .125%, based upon the actual number of days that such
Letter of Credit is outstanding. Borrower also shall pay to Administrative
Agent, for the account of the Issuing Lender, a letter of credit commission with
respect to each Letter of Credit in an amount equal to .125% per annum of the
stated amount of the Letter of Credit, based upon the actual number of days that
such Letter of Credit is outstanding. The Letter of Credit commissions payable
pursuant to the first sentence of this section shall be payable quarterly in
arrears on the first day of each October, January, April, and July, commencing
October 1, 1999, and on the Termination Date. The letter of credit commissions
payable pursuant to the second sentence of this section shall be payable in
arrears on the first day of each October, January, April, and July, commencing
October 1, 1999, on the date such Letter of Credit is extended, and on the
Termination Date.
(b) In addition to the foregoing fees and commissions,
Borrower shall pay or reimburse the Issuing Lender for all normal and customary
costs and expenses as are incurred or charged by the Issuing Lender in issuing,
effecting payment under, amending, or otherwise administering any Letter of
Credit.
(c) Administrative Agent shall, promptly following its receipt
thereof, distribute to the Issuing Lender and the Participating Lenders all fees
and commissions received by Administrative Agent for their respective accounts
pursuant to this subsection.
3.04. LETTER OF CREDIT PARTICIPATION. (a) Effective on the date of
issuance of each Letter of Credit (including, without limitation, each Existing
Letter of Credit which is deemed issued on the Closing Date), the Issuing Lender
irrevocably agrees to grant and hereby grants to each Participating Lender, and
each Participating Lender irrevocably agrees to accept and purchase and hereby
accepts and purchases from the Issuing Lender, on the terms and conditions
hereinafter stated, for the Participating Lender's own account and risk, an
undivided interest equal to the Participating Lender's Commitment Percentage in
the Issuing Lender's obligations and rights under each Letter of Credit
28
36
issued by the Issuing Lender and the amount of each draft paid by the Issuing
Lender thereunder. Each Participating Lender unconditionally and irrevocably
agrees with the Issuing Lender that, if a draft is paid under any Letter of
Credit for which the Issuing Lender is not reimbursed in full by Borrower in
accordance with the terms of this Agreement, the Participating Lender shall pay
to Administrative Agent, for the account of the Issuing Lender, upon demand at
Administrative Agent's address specified in SECTION 12.10, an amount equal to
the Participating Lender's Commitment Percentage of the amount of the draft, or
any part thereof, which is not so reimbursed. On the date that any assignee
becomes a Lender party to this Agreement in accordance with SECTION 12.08,
participating interests in any outstanding Letters of Credit held by the
transferor Lender from which the assignee acquired its interest hereunder shall
be proportionately reallotted between the assignee and the transferor Lender.
Each Participating Lender hereby agrees that its obligation to participate in
each Letter of Credit, and to pay or to reimburse the Issuing Lender for its
participating share of the drafts drawn or amounts otherwise paid thereunder, is
absolute, irrevocable, and unconditional and shall not be affected by any
circumstances whatsoever (including, without limitation, the occurrence or
continuance of any Default or Event of Default), and that each payment shall be
made without offset, abatement, withholding, or other reduction whatsoever.
(b) If any amount required to be paid by any Participating
Lender to the Issuing Lender pursuant to SECTION 3.04(a) in respect of any
unreimbursed portion of any draft paid by the Issuing Lender under any Letter of
Credit is paid to the Issuing Lender within three Business Days after the date
the payment is due, the Participating Lender also shall pay to Administrative
Agent, for the account of the Issuing Lender, on demand, an amount equal to the
product of (i) that amount, times (ii) the daily average Federal Funds Rate
during the period from and including the date the draft is paid to the date on
which the payment is immediately available to the Issuing Lender, times (iii) a
fraction the numerator of which is the number of days that elapsed during that
period and the denominator of which is 360. If any amount required to be paid by
any Participating Lender pursuant to SECTION 3.04(a) is not in fact made
available to Administrative Agent, for the account of the Issuing Lender, by the
Participating Lender within three Business Days after the date the payment is
due, the Issuing Lender shall be entitled to recover from the Participating
Lender, on demand, the amount with interest thereon calculated from the due date
at the Adjusted Base Rate A certificate of the Issuing Lender submitted to any
Participating Lender with respect to any amounts owing under this section shall
be conclusive in the absence of manifest error.
(c) Whenever, at any time after the Issuing Lender has paid a
draft under any Letter of Credit and has received from any Participating Lender
its PRO RATA share of the payment in accordance with SECTION 3.04(a), the
Issuing Lender receives any reimbursement on account of the unreimbursed
portion, or any payment of interest on account thereof, the Issuing Lender will
pay to Administrative Agent, for the account of the Participating Lender, its
PRO RATA share thereof; PROVIDED, HOWEVER, THAT in the event
Amended and Restated Credit Agreement - Page 29
37
that any the payment received by the Issuing Lender shall be required to be
returned by the Issuing Lender, the Participating Lender shall return to
Administrative Agent for the account of the Issuing Lender, the portion thereof
previously distributed to it.
3.05. REIMBURSEMENT OBLIGATION OF BORROWER. If any draft is presented
for payment under any Letter of Credit, the Issuing Lender shall notify Borrower
and Administrative Agent of the date and the amount thereof. Borrower agrees to
reimburse the Issuing Lender (whether with its own funds or with proceeds of
Loans), within two Business Days after notice that the Issuing Lender paid a
draft so presented under any Letter of Credit, for the amount of (i) the draft
so paid and (ii) any taxes, fees, charges, or other costs or expenses incurred
by the Issuing Lender in connection with the payment. Each payment shall be made
to the Issuing Lender at its address for notices specified herein in lawful
money of the United States of America and in immediately available funds.
Interest shall be payable on any and all amounts remaining unpaid by Borrower
under this subsection from the date of payment of the applicable draft until
payment in full thereof, (x) for the period commencing on the date of payment of
the applicable draft to the date which is three days after notice of payment of
the draft, at the Adjusted Base Rate at that time and (y) thereafter, at the
Adjusted Base Rate at that time plus 2%.
3.06. OBLIGATIONS ABSOLUTE. (a) Borrower's obligations under this
Article 3 shall be absolute and unconditional under any and all circumstances
and irrespective of any setoff, counterclaim, or defense to payment which
Borrower or any other Person may have or have had against the Issuing Lender or
any other Lender or any beneficiary of a Letter of Credit. Borrower also agrees
with the Issuing Lender that the Issuing Lender shall not be responsible for,
and Borrower's obligations under SECTION 3.05 shall not be affected by, among
other things, the validity or genuineness of documents or of any endorsements
thereon which on its face appears valid, even though the documents shall in fact
prove to be invalid, fraudulent, or forged, or any dispute between or among
Borrower and any beneficiary of any Letter of Credit or any other party to which
the Letter of Credit may be transferred or any claims whatsoever of Borrower
against any beneficiary of the Letter of Credit or any the transferee. The
Issuing Lender shall not 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 Letter of Credit, except for errors or
omissions caused by the Issuing Lender's gross negligence or willful misconduct.
Borrower agrees that any action taken or omitted by the Issuing Lender under or
in connection with any Letter of Credit or the related drafts or documents, if
done in the absence of gross negligence or willful misconduct and in accordance
with the standards of care specified in the Uniform Commercial Code of the State
of Texas, including, without limitation, Article V thereof, shall be binding on
Borrower and shall not result in any liability of the Issuing Lender to
Borrower.
30
38
(b) Without limiting the generality of the foregoing, it is
expressly agreed that the absolute and unconditional nature of Borrower's
obligations under this Article 3 to reimburse the Issuing Lender for each
drawing under a Letter of Credit will not be excused by the gross negligence or
willful misconduct of the Issuing Lender. However, the foregoing shall not be
construed to excuse the Issuing Lender from liability to Borrower to the extent
of any direct damages (as opposed to consequential damages, claims in respect of
which are hereby waived by Borrower to the extent permitted by applicable law)
suffered by Borrower that are caused by the Issuing Lender's gross negligence or
willful misconduct in determining whether drafts and other documents presented
under a Letter of Credit comply with the terms thereof.
3.07. LETTER OF CREDIT PAYMENTS. Without limitation of SECTION 3.06,
the responsibility of the Issuing Lender to Borrower in connection with any
draft presented for payment under any Letter of Credit shall, in addition to any
payment obligation expressly provided for in the Letter of Credit, be limited to
determining that the documents (including each draft) delivered under the Letter
of Credit in connection with the presentment are in conformity with the Letter
of Credit.
3.08. LETTER OF CREDIT APPLICATIONS. To the extent that any provision
of any Letter of Credit Application, including any reimbursement provisions
contained therein, related to any Letter of Credit is inconsistent with the
provisions of this Article 3, the provisions of this Article 3 shall prevail.
3.09. CASH COLLATERALIZATION OF LETTERS OF CREDIT. Upon request of
Administrative Agent after the occurrence and during the continuance of an Event
of Default and at any time required to eliminate any Borrowing Base Deficiency
pursuant to SECTION 4.06 hereof, Borrower shall deposit cash with Administrative
Agent in an amount equal to the aggregate Letter of Credit Outstandings (or, in
the event of a Borrowing Base Deficiency in the amount required pursuant to
SECTION 4.06). Such amount so deposited shall be held by Administrative Agent
for the ratable benefit of all Lenders as security for the Letter of Credit
Outstandings and other Obligations, and Borrower will, in connection therewith,
deliver such security agreements in form and substance satisfactory to
Administrative Agent which it may, in its discretion require. As drafts or
demands are presented under any Letter of Credit, Administrative Agent shall
disburse such cash to the applicable Issuing Lender to the extent necessary to
satisfy Borrower's reimbursement obligations in connection therewith. To the
extent drafts or other demands for payment are not made prior to the expiration
date for any Letter of Credit, Administrative Agent agrees, if no Event of
Default has occurred and is continuing, to remit to Borrower cash in the amount
deposited under this SECTION 3.09 for which the contingent obligations evidenced
by such Letter of Credit have ceased. When all Letters of Credit have expired or
been canceled, and all Letter of Credit Obligations and other Obligations have
been paid in full and all Commitments have been terminated (or any Borrowing
Base Deficiency has been eliminated to the extent such cash collateralization is
required as a result of Borrowing
Amended and Restated Credit Agreement - Page 31
39
Base Deficiency) Administrative Agent shall release any remaining cash deposited
under this SECTION 3.09 to Borrower.
ARTICLE 4 - BORROWING BASE.
4.01. DETERMINATION OF BORROWING BASE. (a) The term "BORROWING BASE"
means the designated loan value of Borrower's Oil and Gas Properties as
determined by Agents in their sole discretion and approved by Required Lenders
in their sole discretion, in each case in accordance with their respective
then-current practices, customary procedures and standards for their respective
petroleum industry customers, and utilizing (i) the pertinent economic
parameters customarily used by each Lender with respect to credits of a similar
size and nature, and (ii) the information that the Lenders have available to
them at the time of each determination, including, without limitation, assets,
liabilities, cash flow and other financial information regarding Borrower and
its Subsidiaries, the Collateral and the business, properties, prospects,
management, and ownership of the Borrower and its Subsidiaries. The Borrowing
Base in effect under this Agreement shall be redetermined at the times set forth
in SECTION 4.02, 4.03, and 4.04 and in accordance with the procedures set forth
in SECTION 4.01(b). Until the Commitments of all Banks have terminated, all
Letters of Credit have expired or been canceled, and all Obligations have been
paid in full, amounts outstanding under this Agreement shall be subject to the
then effective Borrowing Base.
(b) Not later than ten Business Days prior to each
Determination Date applicable to any redetermination of the Borrowing Base, (i)
Agents shall agree among themselves with respect to the Borrowing Base which
Agents recommend be effective commencing on such Determination Date, and (ii)
Administrative Agent shall notify each Lender of the amount of such recommended
Borrowing Base. If Required Lenders, or all Lenders in the event of a proposed
increase in the Borrowing Base, fail to promptly approve such recommended
Borrowing Base, Agents shall propose one or more alternative Borrowing Bases and
shall consult with Lenders regarding the proposed Borrowing Base until such time
as Required Lenders, or all Lenders in the event of a proposed increase in the
Borrowing Base, approve a Borrowing Base proposed by Agents. Promptly upon
approval by Required Lenders, or all Lenders in the event of a proposed increase
in the Borrowing Base, of the Borrowing Base to become effective on a
Determination Date, Administrative Agent shall provide written notice of the
amount of such Borrowing Base to Borrower which shall become effective on the
date specified in such notice (which shall be no sooner than the date such
notice is sent). In the event Required Lenders, or all Lenders in the event of a
proposed increase in the Borrowing Base, fail to approve a Borrowing Base to be
effective on any applicable Determination Date, the Borrowing Base in effect
prior to such Determination Date shall remain in effect until such time as
Required Lenders, or all Lenders in the event of a proposed increase in the
Borrowing Base, approve a new Borrowing Base (which will become effective
immediately upon notice to Borrower from Administrative Agent setting forth the
amount thereof).
32
40
4.02. PERIODIC DETERMINATION. The Borrowing Base will be redetermined
semiannually on April 1 and October 1, commencing April 1, 2000, or on such date
promptly following each such date as may be required to redetermine the
Borrowing Base in accordance with the procedures set forth in SECTION 4.01(b).
Notwithstanding any provisions to the contrary in SECTION 4.01 above, the
Borrowing Base resulting from the April 1, 2000, Determination shall not exceed
$135,000,000 without the approval of all Lenders.
4.03. SPECIAL REDETERMINATION REQUESTED BY BORROWER. In addition to
Periodic Determinations required herein and Special Determinations requested by
Required Lenders in accordance with SECTION 4.04, Borrower may request up to two
Special Determinations of the Borrowing Base pursuant to this SECTION 4.03 in
each calendar year; PROVIDED THAT one of such requests must be in connection
with a request for an increase in the Borrowing Base to finance the acquisition
by Borrower (or one of its Subsidiaries) of additional oil and gas properties
("ADDITIONAL PROPERTIES"). Together with any Request for Determination delivered
by Borrower to Lenders under this SECTION 4.03, Borrower shall deliver to
Lenders a Reserve Report prepared as of a date not more than 30 days prior to
the date of such Request for Determination. At Borrower's option, such Reserve
Report may only apply to (a) the Additional Properties which are the subject of
such request, or (b) those existing properties which Borrower believes support
an increase in the Borrowing Base as a result of the completion of a successful
drilling and development program or other factors.
4.04. SPECIAL DETERMINATIONS REQUESTED BY REQUIRED LENDERS. In addition
to Periodic Determinations required herein and Special Determinations requested
by Borrower in accordance with SECTION 4.03, Required Lenders may request (a) a
Special Determination in connection with any issuance by Borrower or any of its
Subsidiaries of Subordinated Debt or Preferred Stock, and (b) two Special
Determinations in each calendar year in addition to each Special Determination
allowed under SECTION 4.04(a); PROVIDED THAT one such Special Determination
requested pursuant to this clause (b) shall be based on a determination by
Required Lenders, in their sole discretion that either (i) there has been a
material decrease in the Present Value of Borrower's Oil and Gas Properties, or
(ii) an event has occurred which has had, or which is reasonably expected to
have, a Material Adverse Effect; and FURTHER PROVIDED THAT no Special
Determination may be made pursuant to clause (b) before the April 1, 2000,
Periodic Determination provided in SECTION 4.02 above unless such Special
Determination is requested by all Lenders. In the event Required Lenders request
a Special Determination pursuant to this SECTION 4.04, they may, at their
option, suspend the next Periodic Determination.
4.05. INITIAL BORROWING BASE. Subject to the rights of Borrower to
request an earlier Special Determination pursuant to SECTION 4.03 above, the
rights of Lenders to request an earlier Special Determination pursuant to
SECTION 4.04 above, and the rights of
Amended and Restated Credit Agreement - Page 33
41
Lenders to reduce the Borrowing Base as provided in SECTION 7.03(C) below, the
Borrowing Base in effect under this Agreement for the period from the Closing
Date through April 1, 2000, shall be the Initial Borrowing Base.
4.06. OVER ADVANCE. (a) In the event any Borrowing Base Deficiency
results from any redetermination of the Borrowing Base pursuant to SECTION 4.02,
4.03, or 4.04 hereof, Borrower shall be required to eliminate such deficiency by
making mandatory prepayments on the outstanding principal balance of the Loans
in an amount equal to the amount of such deficiency, one half of which shall be
paid on or before the 90th day following the effective date of the
redetermination resulting in such Borrowing Base Deficiency, and the remaining
balance of which shall be paid in full on or before the 180th day following the
effective date of such redetermination.
(b) In the event any Borrowing Base Deficiency results from
any reduction in the Borrowing Base pursuant to SECTION 4.05, Borrower shall be
required to eliminate such deficiency by making a mandatory prepayment on the
outstanding principal balance of the Loans in an amount equal to the amount of
such deficiency, which prepayment shall be due and payable simultaneously with
such reduction in the Borrowing Base.
(c) In the event any Borrowing Base Deficiency cannot be
eliminated pursuant to this SECTION 4.06 by prepayment of the Loans in full (as
a result of Letter of Credit Outstandings) on or before each date on which a
prepayment of the Loans is required by this SECTION 4.06, Borrower shall also
deposit cash with Administrative Agent to be held by Administrative Agent
pursuant to SECTION 3.09 in an amount sufficient to eliminate such Borrowing
Base Deficiency (or the required portion of such Borrowing Base Deficiency in
the case of the payment due 90 days after the determination that a Borrowing
Base Deficiency exists pursuant to SECTION 4.06(a)).
ARTICLE 5 - COLLATERAL.
5.01. SECURITY. (a) The Obligations shall be secured by first and prior
Liens (subject only to Permitted Encumbrances) covering (i) Borrower's Oil and
Gas Properties selected by Administrative Agent which in the aggregate comprise
at least 80% of the total Present Value assigned by Administrative Agent to
Borrower's Oil and Gas Properties, (ii) the Sterling Gas Plant, (iii) 100% of
the issued and outstanding Equity of each existing and future Subsidiary of
Borrower (exclusive of REFC), and (iv) 50% of the issued and outstanding Equity
of GLEP.
34
42
(b) On each occasion on which Borrower and its Subsidiaries
may be required to grant Liens on any asset, upon submission to Borrower by
Administrative Agent, Borrower and its Subsidiaries shall promptly execute and
deliver to Administrative Agent, for the ratable benefit of each Lender,
Security Documents in form and substance acceptable to Administrative Agent
granting first and prior Liens (subject only to Permitted Encumbrances) on the
designated properties. Borrower acknowledges that all Mortgages now or hereafter
executed by Borrower or its Subsidiaries will be recorded promptly and all other
action necessary to perfect the liens and security interests evidenced by the
Mortgages will be taken. Borrower represents and warrants to Lenders that all
Mortgages (i) are or will be duly authorized, executed, and delivered by the
Person executing them, (ii) constitute the valid, binding, and enforceable
obligations of each Person that executed the Mortgages in accordance with their
terms, and (iii) operate to create in favor of Administrative Agent, for the
ratable benefit of Lenders, first priority liens in the interests covered
thereby.
(c) On the date of the creation or acquisition by Borrower of
any Subsidiary, or on the date of creation or acquisition by any Subsidiary of
Borrower of any Subsidiary, Borrower or such Subsidiary of Borrower (as
applicable) shall execute and deliver to Administrative Agent a Pledge Agreement
together with (i) all certificates (or other evidence acceptable to
Administrative Agent) evidencing the issued and outstanding Equity of any such
Subsidiary of every class which shall be duly endorsed or accompanied by stock
powers executed in blank (as applicable), and (ii) such UCC-1 financing
statements as Administrative Agent shall deem necessary or appropriate to grant,
evidence and perfect the Liens required by SECTION 5.1(a)(iii) in the issued and
outstanding Equity of each such Subsidiary.
5.02. GUARANTIES. Payment and performance of the Obligations will be
fully guaranteed by each existing or hereafter created or acquired Subsidiary of
Borrower (other than REFC) pursuant to a Guaranty Agreement. On the date of
creation or acquisition by Borrower or a Subsidiary of Borrower of any
Subsidiary, Borrower shall cause such Subsidiary to execute and deliver to
Administrative Agent a Guaranty Agreement.
5.03. LEGAL OPINIONS; CORPORATE MATTERS. Administrative Agent will be
permitted, at Borrower's expense, to obtain opinions of counsel in each
jurisdiction in which oil and gas properties of Borrower or its Subsidiaries are
located, with respect to the validity, enforceability, and actions necessary to
perfect the liens and security interests created by the Mortgages covering the
oil and gas properties and as to the other matters as Administrative Agent shall
deem necessary with respect to the Mortgages. Furthermore, simultaneously with
the execution and delivery of any Mortgages required by SECTION 5.01, Borrower
shall also deliver to Administrative Agent (i) such resolutions, certificates,
and documents as Required Lenders shall request relating to the existence of
Borrower and its Subsidiaries, the corporate, partnership, limited liability
company, or other authority for the execution, delivery, and performance of the
Mortgages and all
Amended and Restated Credit Agreement - Page 35
43
other matters relevant thereto as Required Lenders may reasonably request, and
(ii) at Required Lenders' request, an opinion of counsel satisfactory to them
with respect to the matters referred to in clause (i) immediately preceding.
5.04. ADDITIONAL TITLE DATA. (a) Borrower shall, upon the request of
Required Lenders, make available to Administrative Agent at Borrower's Fort
Worth, Texas, and Oklahoma City, Oklahoma, offices, all title opinions, title
information, and other information in its possession, control, or direction with
respect to title to the Mortgaged Properties and relative priority of the
Mortgages as are appropriate to determine the status thereof.
(b) At any time Borrower or its Subsidiaries are required to
mortgage any oil and gas properties and related assets pursuant to SECTION 5.01,
Borrower shall deliver to Administrative Agent title opinions or other title
information acceptable to Administrative Agent covering Borrower's Oil and Gas
Properties which are, or are to become, Mortgaged Properties and other
information regarding title to such properties and the relative priority of the
Liens in favor of Administrative Agent as Administrative Agent shall reasonably
request, all in form and substance and from attorneys acceptable to
Administrative Agent.
5.05. BENEFITS OF COLLATERAL. Administrative Agent shall hold the
Collateral required to be pledged and deposited by the Loan Parties to
Administrative Agent, along with all payments and proceeds arising therefrom,
for the ratable benefit of Lenders as security for the payment of all
Obligations. Upon payment in full of all Obligations and termination of all
Commitments, Administrative Agent shall release, if not sooner released pursuant
to SECTION 5.01(d), all of the Collateral remaining in its possession to
Borrower and shall notify each Lender of the release. Except as otherwise
expressly provided for in this Article 5, Administrative Agent, in its own name
or in the name of Borrower, may enforce any of the Collateral or the security
therefor by any mode provided under the Loan Documents or by the law of the
state in which the Collateral or in which any real property subject to any of
the Collateral is located, and may collect and receive proceeds receivable on
account of ownership of the Collateral.
5.06. STATUS OF COLLATERAL IN EVENT OF DEFAULT. Notwithstanding the
terms of any Mortgage or other security instrument securing repayment of the
Obligations by which Borrower assigns to Administrative Agent for the ratable
benefit of Lenders the proceeds from the sale of production accruing to the
Mortgaged Properties, so long as no Default or Event of Default has occurred
that is continuing, Borrower shall be permitted to continue to receive from the
purchasers of production all proceeds from the sale of production, and
Administrative Agent shall not request that such proceeds be paid to
Administrative Agent. Upon the occurrence and continuation of any Event of
Default, Administrative Agent, at the request of Required Lenders, may direct
the Persons
36
44
purchasing the production from Borrower's Oil and Gas Properties to pay the
proceeds of sale directly to Administrative Agent.
ARTICLE 6 - CONDITIONS PRECEDENT.
6.01. CONDITIONS PRECEDENT TO RESTATEMENT OF EXISTING CREDIT AGREEMENT
AND INITIAL EXTENSION OF CREDIT HEREUNDER. The agreement of each Lender to (i)
enter into and perform its obligations under the Closing Assignment, (ii)
restate the Existing Credit Agreement, and (iii) make the initial Loan requested
to be made by it, and of the Issuing Lender to issue the initial Letter of
Credit to be issued by it, is subject to the satisfaction, prior to or
concurrently therewith of the following conditions precedent:
(a) CLOSING DELIVERIES. Administrative Agent shall have
received the following documents, instruments, agreements, and other
information, each of which shall be in form and substance and executed in such
counterparts as shall be acceptable to Administrative Agent and Required Lenders
and each of which shall, unless otherwise indicated, be dated the Closing Date:
(i) this Agreement;
(ii) a Note payable to the order of each Lender
in the amount of such Lender's Commitment, duly executed by Borrower;
(iii) a Mortgage duly executed by the appropriate
Person covering the Sterling Gas Plant, accompanied by such financing statements
requested by Administrative Agent to perfect the Lien granted by the Mortgage;
(iv) Existing Mortgage Amendments duly executed
by the appropriate Person;
(v) a Guaranty Agreement duly executed by each
of Borrower's Subsidiaries (excluding REFC);
(vi) a Pledge Agreement duly executed by
Borrower and its Subsidiaries, as appropriate, together with (A) certificates
evidencing (1) 100% of the issued and outstanding Equity of Borrower's
Subsidiaries and (2) 50% of the issued and outstanding Equity of GLEP (all
certificates delivered pursuant to this provision shall be duly endorsed or
accompanied by duly executed blank stock powers), and (B) accompanied by such
financing statements executed by Borrower as Administrative Agent shall request
to perfect the Liens granted pursuant to the Pledge Agreement;
(vii) an opinion of ▇▇▇▇▇▇ & ▇▇▇▇▇▇ L.L.P.,
special counsel for Borrower and its Subsidiaries, favorably opining as to the
enforceability of each of the
Amended and Restated Credit Agreement - Page 37
45
Loan Documents executed and delivered by Borrower and its Subsidiaries and to
such other matters as Administrative Agent or Required Lenders may reasonably
request;
(viii) certificates executed by an Authorized
Officer of Borrower stating that (A) the representations and warranties of
Borrower contained in this Agreement and the other Loan Documents are true and
correct in all respects, (B) no Default or Event of Default has occurred which
is continuing, and (C) all conditions set forth in this SECTION 6.01 and in
SECTION 6.02 have been satisfied;
(ix) such resolutions, certificates and other
documents relating to the existence of the Loan Parties, the corporate,
partnership, or limited liability company authority for the execution, delivery
and performance of this Agreement, the Notes, the other Loan Documents, and
certain other matters relevant hereto, in form and substance satisfactory to
Administrative Agent, which resolutions, certificates and documents include
resolutions of the directors of each Loan Party authorizing the execution,
delivery, and performance of the Loan Documents and certificates of incumbency
for each Loan Party;
(x) all documents required by Administrative
Agent to evidence that the GLEP Transaction has closed, which must occur on or
before September 30, 1999;
(xi) Agents have completed a review of the
policies and procedures of Borrower and its Subsidiaries with respect to
compliance with Environmental Laws, and Agents are reasonably satisfied with the
results of that review;
(xii) title information with respect to
Borrower's Oil and Gas Properties and the Sterling Gas Plant sufficient to
enable Agents or their counsel to review title to that part of the Properties
deemed necessary by Agents, and Agents are reasonably satisfied with the results
of that review; and
(xiii) an unaudited pro forma consolidated
balance sheet of Borrower and its Consolidated Subsidiaries which projects the
financial condition of Borrower and its Consolidated Subsidiaries as at the
Closing Date after giving effect to the initial extensions of credit under this
Agreement and which enables Agents to verify that Borrower will have adequate
liquidity on and after the Closing Date, in the sole judgment of Agents.
(b) NO MATERIAL ADVERSE CHANGE. No event has occurred
that would have a Material Adverse Effect.
(c) NO LEGAL PROHIBITION. The transactions contemplated by
this Agreement and the agreements pertinent to the GLEP Transaction shall be
permitted by applicable law and regulation and shall not subject Agents, any
Lender, Borrower, or any
38
46
Subsidiary to any material adverse change in their assets, liabilities,
financial condition, or prospects.
(d) NO LITIGATION. No litigation, arbitration, or similar
proceeding shall be pending which calls into question the validity or
enforceability of this Agreement, the other Loan Documents, or the agreements
pertinent to the GLEP Transaction.
(e) OTHER MATTERS. All matters related to this Agreement, the
other Loan Documents, Borrower, its Subsidiaries, and the GLEP Transaction shall
be acceptable to Administrative Agent and each Lender in their discretion, and
Borrower shall have delivered to Administrative Agent and each Lender such
evidence as they shall request to substantiate any matters related to this
Agreement, the other Loan Documents, Borrower, its Subsidiaries, and the GLEP
Transaction as Administrative Agent or any Lender shall request.
(f) CLOSING FEES. Borrower shall have paid (or made
arrangements for payment from initial Loan proceeds) to Agents and Lenders any
fees payable to those parties.
6.02. CONDITIONS TO EACH LOAN AND EACH LETTER OF CREDIT. The obligation
of each Lender to loan its Commitment Percentage of each Borrowing and the
obligation of the Issuing Lender to issue Letters of Credit on the date any
Letter of Credit is to be issued is subject to the further satisfaction of the
following conditions:
(a) timely receipt by Administrative Agent of a Notice of
Borrowing or Request for Letter of Credit;
(b) immediately before and after giving effect to such
Borrowing or issuance of the Letter of Credit, no Default or Event of Default
shall have occurred and be continuing and neither the Loan nor the issuance of
the Letter of Credit shall cause a Default or Event of Default;
(c) the representations and warranties of the Loan Parties
contained in this Agreement and the other Loan Documents shall be true and
correct in all material respects on and as of the applicable Borrowing or the
date of the issuance of the Letter of Credit;
(d) the funding of the Borrowing or the issuance of the Letter
of Credit and all other Borrowings to be made and/or Letters of Credit to be
issued on the same day under this Agreement, shall not cause a Borrowing Base
Deficiency;
(e) following the issuance of any Letter of Credit, the
aggregate Letter of Credit Outstandings shall not exceed $20,000,000.
Amended and Restated Credit Agreement - Page 39
47
Each Borrowing and the issuance of each Letter of Credit hereunder
shall constitute a representation and warranty by Borrower that on the date of
the Borrowing or issuance of the Letter of Credit that statements contained in
subclauses (b), (c), (d), and (e) above are true.
ARTICLE 7 - REPRESENTATIONS, WARRANTIES, AND COVENANTS.
7.01. WARRANTIES. To induce Lenders to enter into this Agreement and to
lend to Borrower and for each Lender's reliance in so doing, Borrower warrants
to each Lender that each of the following statements is true and correct on the
date hereof and will be true and correct on the Closing Date both before and
after giving effect to the GLEP Transaction, and will be true and correct on the
date of each Borrowing and the date of issuance of each Letter of Credit:
(a) FINANCIAL CONDITION. (1) The consolidated balance sheet of
Borrower and its Consolidated Subsidiaries at December 31, 1998, and the related
consolidated statements of operations, of cash flows and of changes in
stockholders' equity for the fiscal year ended on that date, which have been
furnished to each Lender, present fairly in all material respects the
consolidated financial condition of Borrower and its Consolidated Subsidiaries
as at that date, and the consolidated results of their operations and their
consolidated cash flows for the fiscal year then ended.
(2) The consolidated balance sheet of Borrower
and its Consolidated Subsidiaries at June 30,1999, and the related consolidated
statements of operations, of cash flows and of changes in stockholders' equity
for the two fiscal quarters ended on that date, which have been furnished to
each Lender, present fairly in all material respects the consolidated financial
condition of Borrower and its Consolidated Subsidiaries as at that date, and the
consolidated results of their operations and their consolidated cash flows for
the fiscal year then ended.
(3) The unaudited pro forma consolidated
balance sheet of Borrower and its Consolidated Subsidiaries, as at June 30,
1999, certified by an Authorized Officer, copies of which have been furnished to
each Lender, represents in all material respects the pro forma consolidated
financial condition of each of Borrower and its Consolidated Subsidiaries as at
that date after giving effect to the initial extensions of credit under this
Agreement; PROVIDED THAT the financial information which constitute projections,
copies of which have been furnished to each Lender prior to the Closing Date,
were prepared in good faith on the basis of the assumptions stated therein,
which assumptions were believed by Borrower to be reasonable in all material
respects at the time made and which Borrower believes are reasonable in all
material respects on the date hereof.
(4) The consolidated balance sheet and other
financial statements, referred to in SECTIONS 7.01(a)(1) and (2), including the
related schedules and notes
40
48
thereto, were prepared in accordance with GAAP applied consistently throughout
the period involved. Neither Borrower nor any of its Consolidated Subsidiaries
had, at the date of the balance sheet, any material obligation, contingent
liability, or liability for Taxes, or any long-term lease or unusual forward or
long-term commitment, including, without limitation, any interest rate or
foreign currency swap or exchange transaction, which is not reflected in the
statement or in the notes thereto to the extent required by GAAP. During the
period from January 1, 1999, to and including the date of this Agreement there
has been no sale, transfer, or other disposition by Borrower or any of its
Consolidated Subsidiaries of any material part of its business or property other
than the GLEP Transaction and no purchase or other acquisition of any business
or property (including any Equity of any other Person) material in relation to
the consolidated financial condition of Borrower and its Consolidated
Subsidiaries at December 31, 1998.
(b) NO CHANGE. Since December 31, 1998, there has been no
development, circumstance, or event which has had or could reasonably be
expected to have a Material Adverse Effect.
(c) CORPORATE EXISTENCE. Borrower and each of its Subsidiaries
is duly organized and validly existing under the laws of its state of
incorporation, organization, or formation, and is in good standing in that state
and all other states in which it has material assets or operations.
(d) CORPORATE POWER. Borrower and each of its Subsidiaries has
and will continue to have full power and authority to execute and deliver to
Lenders this Agreement and the Loan Documents, and to perform all of its
obligations under this Agreement and the Loan Documents; all of those actions
have been duly authorized and are not and will not be in conflict with any
provision of law or the terms of its articles of incorporation, articles of
organization, joint venture agreement, partnership agreement, or any other
agreement or undertaking to which it is a party or by which it is bound.
(e) INFORMATION. No written information, exhibit, schedule
or report prepared by or on behalf of Borrower and furnished to any Agent or any
Lender by or at the direction of Borrower or any of its Subsidiaries in
connection with this Agreement or the transactions contemplated herein contained
any material misstatement of fact or, when such statement is considered with all
other written statements furnished to the Lenders in that connection, omitted to
state a material fact or any fact necessary to make the statement contained
therein not misleading; PROVIDED THAT the financial information which constitute
projections, copies of which have been furnished to each Lender prior to the
Closing Date, were prepared in good faith on the basis of the assumptions stated
therein, which assumptions were believed by Borrower to be reasonable in all
material respects at the time made and which Borrower believes are reasonable in
all material respects on the date hereof.
Amended and Restated Credit Agreement - Page 41
49
(f) AUTHORIZATIONS. Borrower and each of its Subsidiaries has
obtained all authorizations, licenses, permits, consents, approvals, and
undertakings which are required under any applicable law in connection with the
execution and delivery of and the performance of its Obligations under or in
connection with this Agreement and the other Loan Documents.
(g) ENFORCEABLE OBLIGATIONS. This Agreement has been, and each
other Loan Document to which any Loan Party is a party will be, duly executed
and delivered on behalf of the Loan Party. This Agreement constitutes, and each
other Loan Document to which any Loan Party is a party when executed and
delivered will constitute, a legal, valid, and binding obligation of the Loan
Party enforceable against the Loan Party in accordance with its terms, subject
to the effects of bankruptcy, insolvency, fraudulent transfer or conveyance,
reorganization, moratorium, and other similar laws relating to or affecting
creditors' rights generally, general equitable principles (whether considered in
a proceeding in equity or at law), and an implied covenant of good faith and
fair dealing.
(h) NO LEGAL BAR. The execution, delivery, and performance of
the Loan Documents, the granting of the Liens under the Security Documents, and
the Borrowings hereunder and the use of the proceeds thereof will not violate
any applicable requirement of law or material contractual Obligation of Borrower
or any of its Subsidiaries and will not result in, or require, the creation or
imposition of any Lien on any of its or their respective material properties or
revenues except pursuant to the Loan Documents.
(i) COMPLIANCE. Borrower and each of its Subsidiaries is in
compliance with all statutes, ordinances, and regulations of each Governmental
Authority having jurisdiction over its activities to the extent a failure to be
in compliance could reasonably be expected to have a Material Adverse Effect.
(j) DEBTS OF OTHERS. Neither Borrower nor any of its
Subsidiaries is a guarantor or surety or otherwise responsible in any material
manner with respect to any Debt or undertaking of a Person other than a
Subsidiary of Borrower.
(k) NO MATERIAL LITIGATION. No litigation is pending which
affects the execution and delivery of this Agreement or any other Loan Document
or the ability of any Loan Party to perform under them, and no litigation is
pending which could have a Material Adverse Effect.
(l) SUBSIDIARIES. Borrower has no Subsidiaries other than
those listed on attached SCHEDULE 3.
(m) ERISA. Borrower and each Subsidiary of Borrower is in
compliance in all material respects with all applicable provisions of ERISA;
neither a Reportable Event nor a Prohibited Transaction has occurred and is
continuing with respect to any Plan; no notice of intent to terminate a Plan has
been filed, nor has any Plan been
42
50
terminated; no circumstances exist which constitute grounds entitling the PBGC
to institute proceedings to terminate, or appoint a trustee to administer, a
Plan, nor has the PBGC instituted any such proceedings; neither Borrower nor any
Commonly Controlled Entity has completely or partially withdrawn from a
Multiemployer Plan; Borrower and each Commonly Controlled Entity have met their
minimum funding requirements under ERISA with respect to all of their Plans and
the present value of all vested benefits under each Plan does not exceed the
fair market value of all Plan assets allocable to the benefits, as determined on
the most recent valuation date of the Plan and in accordance with the provisions
of ERISA; and neither Borrower nor any Commonly Controlled Entity has incurred
any liability to the PBGC under ERISA.
(n) ENVIRONMENTAL MATTERS. To the extent any of the following
would have a Material Adverse Effect on Borrower or its Subsidiaries:
(i) Neither Borrower nor any of its
Subsidiaries has failed to duly comply with, or failed to cause their
businesses, operations, assets, equipment, property, leaseholds, or other
facilities to be in compliance with, the provisions of any applicable
Environmental Law.
(ii) Neither Borrower nor any of its
Subsidiaries has received notice of, nor knows of, or suspects facts which might
constitute violations of any applicable Environmental Law with respect to its
businesses, operations, assets, equipment, property, leaseholds, or other
facilities.
(iii) Except in accordance with a valid
governmental permit, license, certificate, or approval, there has been no
emission, spill, release, or discharge into or upon (1) the air; (2) soils, or
any improvements located thereon; (3) surface water or groundwater; or (4) the
sewer, septic system or waste treatment, storage, or disposal system servicing
the premises of any toxic or hazardous substances or wastes ("WASTE") at or from
the premises ("RELEASE"); and accordingly the premises of Borrower and any
Subsidiary are free of all waste.
(iv) There has been no complaint, order,
directive, claim, citation, or notice by any Governmental Authority or any
person or entity with respect to (1) air emissions; (2) release; (3) noise
emissions; (4) solid or liquid waste disposal; (5) the use, generation, storage,
transportation, or disposal of waste ("TREATMENT"); or (6) other environmental,
health, or safety matters affecting Borrower or any Subsidiary of Borrower or
its business, operations, assets, equipment, property, leaseholds, or other
facilities.
(o) TITLES. Each of Borrower and its Subsidiaries has good and
defensible title to all material assets purported to be owned by it subject only
to Permitted Encumbrances. Without limiting the foregoing, with the exception of
oil and gas properties which are clearly identified as being owned by Persons
other than the Loan
Amended and Restated Credit Agreement - Page 43
51
Parties, the Loan Parties have good and defensible title to all material oil and
gas properties which are the subject of the most recent Reserve Report provided
to Lenders (or, until superseded, the oil and gas properties which are the
subject of the Initial Reserve Report), and the Mortgages establish first and
prior Liens on the properties and interests intended to be covered thereby
subject only to Permitted Encumbrances.
(p) RESERVE REPORTS. The Initial Reserve Report accurately
reflects, and all Reserve Reports hereafter delivered pursuant to this Agreement
will reflect, in all material respects, the ownership interests of Borrower and
its Subsidiaries in the oil and gas properties referred to therein (including
all material before and after payout calculations).
(q) INTELLECTUAL PROPERTY. Each Loan Party owns, or is
licensed to use, all trademarks, tradenames, copyrights, technology, know how,
and processes necessary for the conduct of its business as currently conducted
except for those the failure to own or license which could not reasonably be
expected to have a Material Adverse Effect (the "INTELLECTUAL PROPERTY"). No
claim has been asserted and is pending by any Person challenging or questioning
the use of any Intellectual Property or the validity or effectiveness of any
Intellectual Property, nor does any Loan Party know of any valid basis for any
such claim, except claims that, in the aggregate, could not reasonably be
expected to have a Material Adverse Effect. The use of Intellectual Property by
a Loan Party does not infringe on the rights of any Person, except for claims
and infringements that, in the aggregate, could not reasonably be expected to
have a Material Adverse Effect.
(r) NO BURDENSOME RESTRICTIONS. No applicable requirement of
law or contractual obligation of any Loan Party could reasonably be expected to
have a Material Adverse Effect.
(s) TAXES. Each Loan Party has filed all material tax returns
which to the knowledge of the Loan Party are required to be filed by it and has
paid or caused to be paid all material assessments, fees, and other governmental
charges levied upon it or upon any of its property or income which are due and
payable, except such taxes, assessments, fees, and other governmental charges,
if any, as are being diligently contested in good faith and by appropriate
proceedings and with respect to which there have been established adequate
reserves on the books of the Loan Party in accordance with GAAP. No tax lien has
been filed with respect to any material taxes or material assessments, fees, or
other governmental charges.
(t) FEDERAL REGULATIONS. No part of the proceeds of any Loan
will be used for "purchasing" or "carrying" any "margin stock" within the
respective meanings of each of the quoted terms under Regulation G or Regulation
U of the Board of Governors of the Federal Reserve System as now and from time
to time hereafter in effect. If requested by any Lender or Administrative Agent,
Borrower will furnish Administrative
44
52
Agent and each Lender a statement to the foregoing effect in conformity with the
requirements of FR Form G-1 or FR Form U-1 referred to in Regulation G or
Regulation U, as the case may be.
(u) INVESTMENT COMPANY ACT; OTHER REGULATIONS. No Loan Party
is an "investment company", or a company "controlled" by an "investment
company", within the meaning of the Investment Company Act of 1940, as amended.
No Loan Party is subject to regulation under any Federal or State statute or
regulation (other than Regulation X of the Board of Governors of the Federal
Reserve System) which limits its ability to incur Indebtedness under this
Agreement or the other Loan Documents.
(v) YEAR 2000 PROBLEM. Borrower and its Subsidiaries have
reviewed the areas within their business and operations which could be adversely
affected by, and have developed or are developing a program to address on a
timely basis, the risk that certain computer applications used by Borrower and
its Subsidiaries may be unable to recognize and perform properly date-sensitive
functions involving dates after December 31, 1999 (the "YEAR 2000 PROBLEM"). The
Year 2000 Problem is not reasonably expected to result in a Material Adverse
Effect.
7.02. AFFIRMATIVE COVENANTS. Borrower hereby agrees that, so long as
the Total Commitment remains in effect, any Loan, Note, or Letter of Credit
remains outstanding and unpaid, or any amount is owing to any Lender or any
Agent under this Agreement or any other Loan Document, Borrower shall, and
except in the case of delivery of financial information, reports and policies,
cause each of its Subsidiaries to:
(a) CORPORATE EXISTENCE. Maintain its existence in good
standing with full legal capacity to perform all of its obligations under this
Agreement and all documents called for by this Agreement and not permit its
dissolution, liquidation, or other termination of existence or forfeiture of
right to do business.
(b) MAINTENANCE OF BOOKS AND RECORDS. At all times keep
business records in conformity with GAAP, those records to be kept at Borrower's
administrative office, which at present is located at ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇,
▇▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇.
(c) FINANCIAL INFORMATION. Furnish to Lenders:
(1) Within 90 days after the end of Borrower's
fiscal year (which ends on December 31), a copy of its annual audited
consolidated financial statement including at least a balance sheet as of the
close of the year, a statement of operations, a statement of changes in
shareholders' equity, and a statement of cash flow, prepared in conformity with
GAAP by ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ L.L.P. or another independent firm of certified public
accountants acceptable to Lenders, together with a certificate from an
Amended and Restated Credit Agreement - Page 45
53
Authorized Officer of Borrower that no Default or Event of Default has occurred
or exists;
(2) Within 45 days after the end of each of the
first three calendar quarters, a copy of Borrower's unaudited consolidated
quarterly report, prepared in conformity with GAAP, consisting of at least a
balance sheet as of the close of that quarter, a statement of operations, a
statement of changes in shareholders' equity, and a statement of cash flows for
the period from the beginning of the fiscal year to the close of that quarter,
certified to be accurate by an Authorized Officer of Borrower, and accompanied
by a certificate of the signing officer that no Default or Event of Default has
occurred or exists;
(3) Simultaneously with the delivery of the
financial statements referred to in SECTIONS 7.02(c)(1) and (2), a compliance
certificate in the form of EXHIBIT G hereto signed by an Authorized Officer of
Borrower (i) certifying that it is in compliance with the provisions of SECTION
7.04, (ii) setting forth in reasonable detail the calculations required to
establish that Borrower was in compliance with the provisions of SECTION 7.04 as
of the end of each quarter, and (iii) certifying that no Default or Event of
Default has occurred and is continuing and that all representations and
warranties of Borrower are true and correct.
(4) No later than each March 1 and September
1 during the Commitment Period, a Reserve Report as of the preceding December 31
and June 30, respectively, covering all of the oil and gas properties of
Borrower and its Subsidiaries that in the opinion of Required Lenders have
material value;
(5) No later than March 1 and September 1, (i)
complete revenue, expense, and production information for the aggregate of the
oil and gas properties of Borrower and its Subsidiaries for the most recent
twelve-month period preceding the Determination Date; (ii) detailed revenue,
expense, and production information for the same time period, for each area of
operation, for oil and gas ▇▇▇▇▇ of Borrower and its Subsidiaries; (iii) an oil
and gas operating statement prepared on a basis acceptable to Lenders reflecting
at a minimum, for the pertinent period, net production volume, prices received,
severance taxes, and capital and operating expenses, including a calculation of
net operating income; and (iv) a summary of the Hedge Transactions to which
Borrower or any Subsidiary is a party on such date;
(6) Promptly upon filing thereof with the
Securities and Exchange Commission, copies of the following securities
information for Borrower: (i) all final registration statements and post
effective amendments thereto; (ii) all annual, quarterly, and special reports
filed; and (iii) any item submitted for a vote of Borrower's shareholders;
46
54
(7) No later than 10 days before the date that
Borrower issues Preferred Stock or incurs Subordinated Debt (to the extent
permitted hereunder), written notice setting out all details deemed material by
Lenders concerning either event; and
(8) As Required Lenders may from time to time
reasonably require by written notice to Borrower, other reasonable oil or gas
well information, other financial information and other information concerning
the business affairs of Borrower and its Subsidiaries in addition to those
specifically required by this Agreement.
(d) RIGHT TO INSPECT. Permit any Person designated by any
Lender to visit and inspect at reasonable places and times during normal
business hours any of the properties, books, and records of Borrower and any
Subsidiary as often as any Lender may reasonably request.
(e) PAYMENT OF OTHER OBLIGATIONS. Pay when due all Taxes,
assessments, and other liabilities, except and so long as contested in good
faith in a manner acceptable to Lenders and adequate reserves are being
maintained.
(f) PERFORMANCE. Promptly and fully perform all of its
obligations under this Agreement and all other Loan Documents (whether now
existing or entered into hereafter).
(g) INSURANCE. Maintain casualty insurance on all material
property and improvements and maintain liability insurance to such extent and
against such hazards and liabilities as like properties are customarily insured
within the oil and gas industry by Persons similarly situated to Borrower (each
policy of insurance must be with responsible insurers and must name
Administrative Agent as loss payee and as an additional insured party), and
deliver to Administrative Agent certificates of insurance coverage as and when
reasonably requested by Administrative Agent.
(h) DEPOSITORY ACCOUNTS. Maintain its primary depository
accounts at one or more of Lenders (Borrower acknowledges that this requirement
is a legitimate and reasonable measure to preserve and protect Lenders' first
priority Liens in all property intended as Security for the Obligations under
the Loan Documents).
(i) NOTICE OF DEFAULT AND LITIGATION. Give Lenders prompt
notice in writing of the occurrence or existence of a Default, an Event of
Default, any litigation or proceeding or other event affecting Borrower or any
of its Subsidiaries that could reasonably be expected to have a Material Adverse
Effect.
(j) FURTHER ASSURANCES. Borrower will and will cause each
Subsidiary to cure promptly any defects in the creation and issuance of the
Notes and the execution and delivery of the Security Documents and this
Agreement. Borrower at its expense will and
Amended and Restated Credit Agreement - Page 47
55
will cause each Subsidiary to promptly execute and deliver to Administrative
Agent upon request all such other documents, agreements, and instruments to
comply with or accomplish the covenants and agreements of Borrower or any
Subsidiary, as the case may be, in the Security Documents and this Agreement, or
to further evidence and more fully describe the collateral intended as security
for the Obligations, or to correct any omissions in the Security Documents, or
to state more fully the security obligations set out herein or in any of the
Security Documents, or to perfect, protect, or preserve any Liens created
pursuant to any of the Security Documents, or to make any recordings, to file
any notices or obtain any consents, all as may be necessary or appropriate in
connection therewith.
(k) MAINTENANCE AND OPERATION OF PROPERTY. To the extent that
the failure to comply could have a Material Adverse Effect on the financial
condition or operations of Borrower or its Subsidiaries and consistent with the
standards of a reasonably prudent operator:
(1) Maintain, develop, and operate Borrower's
Oil and Gas Properties in a good and workmanlike manner, and observe and comply
with all of the terms and provisions, express or implied, of all oil and gas
leases relating to the properties so long as the oil and gas leases are capable
of producing hydrocarbons and accompanying elements in paying quantities;
(2) Comply in all material respects with all
contracts and agreements applicable to or relating to Borrower's Oil and Gas
Properties or the production and sale of hydrocarbons and accompanying elements
therefrom;
(3) At all times, maintain, preserve, and
keep all operating equipment used with respect to Borrower's Oil and Gas
Properties in proper repair, working order and condition, and make all necessary
or appropriate repairs, renewals, replacements, additions and improvements
thereto so that the efficiency of the operating equipment shall at all times be
properly preserved and maintained, PROVIDED THAT no item of operating equipment
need be so repaired, renewed, replaced, added to or improved, if Borrower or its
Subsidiary shall in good faith determine that the action is not necessary or
desirable for its continued efficient and profitable operation of business.
(4) With respect to Borrower's Oil and Gas
Properties which are operated by operators other than Borrower or a Subsidiary,
seek to enforce the operators' contractual obligations to maintain, develop, and
operate the oil and gas properties subject to the applicable operating
agreements.
(l) ERISA. As soon as possible, and in any event within 30
days after Borrower knows or has reason to know that any circumstances exist
that constitute grounds entitling the PBGC to institute proceedings to terminate
a Plan subject to ERISA
48
56
with respect to Borrower or any Commonly Controlled Entity, and promptly but in
any event within two Business Days of receipt by Borrower or any Commonly
Controlled Entity of notice that the PBGC intends to terminate a Plan or appoint
a trustee to administer the same, and promptly but in any event within five
Business Days of the receipt of notice concerning the imposition of withdrawal
liability with respect to Borrower or any Commonly Controlled Entity, Borrower
shall deliver to each Lender a certificate of the chief financial officer of
Borrower setting forth all relevant details and the action which Borrower
proposes to take with respect thereto.
(m) ENVIRONMENTAL MATTERS. To the extent necessary to avoid a
Material Adverse Effect, be and remain, and cause each Subsidiary to be and
remain, in compliance with the provisions of all Environmental Laws; notify
Administrative Agent immediately of any notice of a hazardous discharge or
material environmental complaint received from any Governmental Authority or any
other party; notify Administrative Agent immediately of any release from or
affecting its properties; immediately contain and remove the same, in compliance
with all applicable laws; promptly pay any fine or penalty assessed in
connection therewith; permit Administrative Agent to inspect the premises, to
conduct tests thereon, and to inspect all books, correspondence, and records
pertaining thereto; and at Administrative Agent's request, and at Borrower's
expense, provide a report of a qualified environmental engineer, satisfactory in
scope, form, and content to Administrative Agent, and all other and further
assurances reasonably satisfactory to Administrative Agent that the condition
has been corrected.
(n) ENVIRONMENTAL INDEMNITY. NOTWITHSTANDING ANY OTHER
LIMITATION OF LIABILITY IN THIS OR ANY OTHER AGREEMENT OR INSTRUMENT BETWEEN
BORROWER OR A SUBSIDIARY AND LENDERS OR AGENTS, BORROWER PROMISES THAT IT WILL
INDEMNIFY, DEFEND, SAVE, AND HOLD HARMLESS EACH LENDER AND EACH AGENT AND
AGENT'S AND EACH LENDER'S AFFILIATES, OFFICERS, DIRECTORS, SHAREHOLDERS,
EMPLOYEES, AGENTS, ATTORNEYS, PARTNERS, AND THEIR RESPECTIVE HEIRS, SUCCESSORS,
AND ASSIGNS (COLLECTIVELY, THE "INDEMNIFIED PARTIES") AGAINST AND FROM, AND TO
REIMBURSE INDEMNIFIED PARTIES WITH RESPECT TO, ANY AND ALL DAMAGES, CLAIMS,
LIABILITIES, LOSSES, COSTS, AND EXPENSES (INCLUDING, WITHOUT LIMITATION,
REASONABLE ATTORNEY'S FEES AND EXPENSES, COURT COSTS, ADMINISTRATIVE COSTS, AND
COSTS OF APPEALS), INCURRED BY OR ASSERTED AGAINST INDEMNIFIED PARTIES BY REASON
OR ARISING OUT OF THE TREATMENT OR RELEASE OF ANY WASTE IN, ON, OR AFFECTING OIL
AND GAS PROPERTIES OF BORROWER OR ITS SUBSIDIARIES, WHETHER OR NOT CAUSED BY
BORROWER OR ANY OF ITS SUBSIDIARIES, OR THE VIOLATION OF ANY ENVIRONMENTAL LAWS,
EXCEPT TO THE EXTENT CAUSED BY THE GROSS NEGLIGENCE OR WILFUL MISCONDUCT OF ANY
Amended and Restated Credit Agreement - Page 49
57
INDEMNIFIED PARTY. NOTWITHSTANDING ANYTHING IN THE LOAN DOCUMENTS TO THE
CONTRARY, THE UNDERTAKINGS OF BORROWER IN THIS PARAGRAPH SHALL SURVIVE THE
EXPIRATION OR TERMINATION OF THIS AGREEMENT REGARDLESS OF THE MEANS OF
EXPIRATION OR TERMINATION ; PROVIDED, HOWEVER, NO INDEMNITY SHALL BE AFFORDED
UNDER THIS SECTION 7.02(N) IN RESPECT OF ANY PROPERTY FOR ANY OCCURRENCE ARISING
FROM THE ACTS OR OMISSIONS OF ADMINISTRATIVE AGENT OR ANY LENDER DURING THE
PERIOD AFTER WHICH SUCH PERSON, ITS SUCCESSORS OR ASSIGNS, SHALL HAVE OBTAINED
POSSESSION OF SUCH PROPERTY (WHETHER BY FORECLOSURE OR DEED IN LIEU OF
FORECLOSURE, AS MORTGAGEE-IN-POSSESSION OR OTHERWISE). SPECIFICALLY, THE
INDEMNIFICATION IN THIS PARAGRAPH SHALL RUN FROM THE NOTICE COMMUNICATED TO
ADMINISTRATIVE AGENT OF ANY TREATMENT OR RELEASE OF WASTE OR OTHER ENVIRONMENTAL
CONDITION COVERED BY THIS AGREEMENT.
(o) OTHER INDEMNITY. BORROWER AGREES TO INDEMNIFY THE
INDEMNIFIED PARTIES AND HOLD THEM HARMLESS FROM AND AGAINST ANY AND ALL
LIABILITIES, LOSSES, DAMAGES, COSTS AND EXPENSES OF ANY KIND (INCLUDING, WITHOUT
LIMITATION, THE REASONABLE FEES AND DISBURSEMENTS OF COUNSEL FOR EACH
INDEMNIFIED PARTY IN CONNECTION WITH ANY INVESTIGATIVE, ADMINISTRATIVE OR
JUDICIAL PROCEEDING, WHETHER OR NOT THE INDEMNIFIED PARTIES SHALL BE DESIGNATED
A PARTY THERETO) WHICH MAY BE INCURRED BY ANY INDEMNIFIED PARTY, RELATING TO OR
ARISING OUT OF THIS AGREEMENT OR ANY ACTUAL OR PROPOSED USE OF PROCEEDS OF LOANS
HEREUNDER, INCLUDING AN INDEMNIFIED PARTY'S NEGLIGENCE; PROVIDED THAT
INDEMNIFIED PARTIES SHALL NOT BE INDEMNIFIED HEREUNDER FOR THEIR OWN GROSS
NEGLIGENCE OR WILLFUL MISCONDUCT.
7.03. NEGATIVE COVENANTS. Borrower hereby agrees that, so long as the
Total Commitments remain in effect, any Loan, Note, or any Letter of Credit
remains outstanding and unpaid, or any amount is owing to any Lender or any
Agent hereunder or under any other Loan Document, Borrower shall not, and shall
not permit any Subsidiary to, directly or indirectly:
(a) OTHER LIENS. Create incur, assume, or permit to exist any
Lien with respect to any of its assets, whether now owned or hereafter acquired,
EXCEPT FOR (i) Permitted Encumbrances; (ii) Liens securing Capital Leases
allowed under Section 7.03(b)(1)(vi), but only on the property under lease;
(iii) Liens on cash or securities of Borrower or any Subsidiary securing the
Debt described in Section 7.03(b)(1)(vii); and (iv) Liens set forth on SCHEDULE
4 hereto.
50
58
(b) OTHER DEBT. Create, incur, assume or suffer to exist, or
permit any Subsidiary to create, incur, assume or suffer to exist, any Debt
except:
(1) (i) Debt under this Agreement;
(ii) Subordinated Debt incurred by Borrower as a result of the exchange of
Preferred Stock issued in Borrower's November 1995 Preferred Stock offering;
(iii) Subordinated Debt in existence on the Closing Date and Subordinated Debt
subsequently incurred by Borrower, the terms and amount of which are acceptable
to Required Lenders; (iv) Debt under any Hedge Transaction permitted by SECTIONS
7.03(i) or (l) below; (v) Debt under Capital Leases not to exceed $10,000,000;
(vi) Debt associated with bonds or surety obligations required in the ordinary
course of business by any Governmental Authority in connection with the
operation of Borrower's Oil and Gas Properties; (vii) Debt of Borrower and its
Subsidiaries existing on the Closing Date which is reflected in the financial
statements described in SECTION 7.01(a) or otherwise disclosed to Administrative
Agent in writing, and any renewals or extensions (but not increases) thereof;
(viii) accounts payable (for the deferred purchase price of property or
services) from time to time incurred in the ordinary course of business which,
if greater than 90 days past the invoice or billing date, are being contested in
good faith by appropriate proceedings if reserves adequate under GAAP shall have
been established therefor; (ix) Debt of Borrower arising under any Guarantee by
Borrower of a Subsidiary's obligations with respect to gas purchase agreements
or other contracts for the purchase of crude oil or natural gas excluding such
obligations of REFC; and (x) Debt of REFC with respect to which there is no
recourse for repayment to Borrower or any other Subsidiary of Borrower; and
(2) Debt in addition to that permitted in
SECTION 7.03(b)(1) not to exceed $10,000,000 in the aggregate.
(c) MERGERS AND SALES OF ASSETS. Borrower will not and will
not permit any Subsidiary of Borrower to (a) merge or consolidate with, whether
in one transaction or in a series of transactions, any Person or Persons or (b)
sell, assign, lease, or otherwise dispose of, whether in one transaction or in a
series of transactions, any properties (a "PROPERTY DISPOSITION") other than (x)
sales of hydrocarbons produced from Borrower's Oil & Gas Properties in the
ordinary course of business and (y) other Property Dispositions; PROVIDED THAT
(i) unless Borrower has provided Lenders prior notice of a Property Disposition
as provided in clause (ii) below, (A) such Property Disposition may only be for
cash consideration, and (B) the Borrowing Base shall reduce simultaneously with
the completion of such Property Disposition by an amount equal to the Net Cash
Proceeds from such Property Disposition, and (ii) Borrower may, at its option in
connection with any Property Disposition in which the cash consideration
consists solely of cash, and Borrower shall, in connection with any Property
Disposition in which the consideration consists in whole or in part of property
other than cash, provide Lenders not less than 15 days advance written notice of
such Property Disposition, describing the
Amended and Restated Credit Agreement - Page 51
59
properties to be disposed of and the consideration to be received, and Lenders
shall have the right to reduce the Borrowing Base then in effect by an amount
equal to the Borrowing Base value attributable to the properties to be disposed
of; any reduction in the Borrowing Base pursuant to this clause (ii) shall (A)
be determined by Required Lenders in their sole discretion but in a manner
consistent with redeterminations of the Borrowing Base generally as provided in
Article IV, (B) shall be effective simultaneously with the subject Property
Disposition, and (C) shall not be in lieu of any Special Determination available
to Lenders under Article IV; notwithstanding the foregoing, no reduction of the
Borrowing Base shall be required in connection with a Property Disposition under
this clause (b) of this SECTION 7.03(c) except with respect to the aggregate
consideration received by Borrower and its Subsidiaries for all Property
Dispositions completed since the most recent Periodic Determination (including
the consideration to be received pursuant to the subject Property Disposition)
that exceeds 5% of the Borrowing Base in effect immediately after such Periodic
Determination. Notwithstanding anything to the contrary contained in clause (a)
of this SECTION 7.03(c), Borrower or any Subsidiary of Borrower may merge or
consolidate with any other Person and any Subsidiary of Borrower may transfer
properties to any other Subsidiary of Borrower or to Borrower so long as, in
each case, (i) immediately thereafter and giving effect thereto, no event will
occur and be continuing which constitutes an Event of Default, (ii) in the case
of any such merger or consolidation to which Borrower is a party, Borrower is
the surviving Person, (iii) in the case of any such merger or consolidation to
which any Subsidiary of Borrower is party (but not Borrower), a Subsidiary is
the surviving Person, and (iv) the surviving Person ratifies each applicable
Loan Document and; PROVIDED, FURTHER, THAT any Subsidiary of Borrower may merge
or consolidate with any other Subsidiary of Borrower so long as, in each case
(i) immediately thereafter and giving effect thereto, no event will occur and be
continuing which constitutes an Event of Default and (ii) the surviving Person,
if necessary, ratifies each applicable Loan Document.
(d) CHANGES IN BUSINESS. Engage in any business which differs
substantially from its present business.
(e) PLAN CONTRIBUTIONS. Make contributions to any Plan in any
one year which, in the aggregate, exceed $4,000,000.
(f) ADVANCES AND INVESTMENTS. Make or permit any Subsidiary to
make Advances to any Person or Investments in any Person; PROVIDED THAT Borrower
and its Subsidiaries may (i) make Advances to or Investments in any wholly owned
Subsidiary of Borrower excluding REFC, (ii) make Advances in addition to those
described in clause (i) preceding which do not exceed $5,000,000 in the
aggregate in any calendar year and $15,000,000 in the aggregate during the
Commitment Period, and (iii) make Permitted Investments.
52
60
(g) RESTRICTED PAYMENTS. Make any Restricted Payment; PROVIDED
THAT so long as no Default or Event of Default exists and no Default or Event of
Default will result from the Restricted Payment, Restricted Payments may be made
in an aggregate amount (measured cumulatively from June 30, 1999) not to exceed
the sum of (i) $10,000,000, plus (ii) 50% of the Net Cash Proceeds to Borrower
from all common equity offerings completed by Borrower after the Closing Date,
plus (ii) 50% of Borrower's Consolidated Net Income earned after June 30, 1999
(for purposes of this SECTION 7.03(g) only, Consolidated Net Income shall
exclude non-cash impairments of long-lived assets as prescribed under Financial
Accounting Standards Board Statements Nos. 19 and 121).
(h) INTEREST PAYMENTS. Make payments of interest or principal
on Subordinated Debt, if there is an Event of Default under this Agreement or if
a payment of interest or principal on the Subordinated Debt will cause a breach
of any of the covenants set out in SECTION 7.04.
(i) OIL AND GAS HEDGE TRANSACTIONS. Enter into Oil and Gas
Hedge Transactions with the exception that Borrower and its Subsidiaries may
enter into Oil and Gas Hedge Transactions as long as the volume of hydrocarbons
with respect to which a settlement payment is calculated under such Oil and Gas
Hedge Transactions does not exceed 80% of Borrower's and its Subsidiaries'
anticipated production from proved, developed producing reserves during the
period from the immediately preceding settlement date (or the commencement of
the term of such Oil and Gas Hedge Transactions if there is no prior settlement
date) to such settlement date.
(j) TRANSACTIONS WITH AFFILIATES. Engage in any material
transaction with an Affiliate unless the transaction is generally as favorable
to Borrower or any Subsidiary as could be obtained in an arm's length
transaction with an unaffiliated Person in accordance with prevailing industry
customs and practices.
(k) PLANS. Permit any Subsidiary to create, adopt, or become
bound by any Plan.
(l) SPECULATIVE HEDGE TRANSACTIONS. Enter into or permit any
Subsidiary to enter into any commodity, interest rate, currency or other swap,
option, collar or other derivative transaction pursuant to which Borrower or a
Subsidiary speculates on the movement of commodity prices, interest rates,
financial markets, currency markets or other items; PROVIDED THAT nothing
contained herein shall prohibit Borrower from (a) entering into interest rate
swaps or other interest rate hedge transactions pursuant to which Borrower
▇▇▇▇▇▇ interest rate risk with respect to the interest reasonably anticipated to
be incurred pursuant to this Agreement, (b) entering into Oil and Gas Hedge
Transactions permitted by this SECTION 7.03(i) hereof, or (c) making Permitted
Investments.
Amended and Restated Credit Agreement - Page 53
61
(m) OPTIONAL PAYMENTS AND MODIFICATIONS. Make any optional
payment on or defeasance or purchase of (or otherwise set apart assets for a
sinking or other analogous fund or trust for the purchase of) any Debt, or
amend, modify, waive, supplement or terminate, or permit the amendment,
modification, supplement, waiver or termination of any document related to
Subordinated Debt.
(n) LIMITATION ON SALES AND LEASEBACKS. Enter into any
arrangement with any Person providing for the leasing by Borrower or any
Subsidiary of any real or personal property which has been or is to be sold or
transferred by Borrower or the Subsidiary to the Person or to any other Person
to whom funds have been or are to be advanced by the Person on the security of
the property or rental obligations of Borrower or any Subsidiary.
(o) LIMITATION ON NEGATIVE PLEDGE CLAUSES. Enter into with any
Person any agreement, other than the Loan Documents, which prohibits or limits
the ability of Borrower or any Subsidiary to create, incur, assume, or suffer to
exist any Lien upon any of its property, assets, or revenues, whether now owned
or hereafter acquired, other than restrictions imposed in connection with
Capital Leases or purchase money obligations for property leased or acquired in
the ordinary course of business on the property so leased or acquired, customary
restrictions contained in stock purchase agreements, asset sale agreements
limiting the transfer of assets pending the closing of the sale, and customary
non-assignment provisions in leases entered into in the ordinary course of
business and consistent with past practice.
(p) RESTRICTIONS WITH RESPECT TO OBLIGATIONS OF REFC. Issue a
Guarantee with respect to any Debt or other obligation of REFC or otherwise
become liable, directly or indirectly, for any such Debt or other obligation,
with the exception that Borrower may issue the REFC Guarantee; or make any
Advance to, Investment in, or Distribution to REFC other than as may be
permitted under SECTION 7.03(f) and SECTION 7.03(g) above.
7.04. FINANCIAL COVENANTS. So long as this Agreement remains in force,
Borrower and its Consolidated Subsidiaries shall maintain, on a consolidated
basis, the following (all calculated in accordance with GAAP):
(a) CONSOLIDATED TANGIBLE NET WORTH. A minimum Consolidated
Tangible Net Worth as of any date which is not less than the sum of (i)
$175,000,000, plus (ii) 50% of the net proceeds to Borrower from the issuance of
equity securities on or after September 30, 1999 (for purposes of this SECTION
7.04(a) only, Consolidated Tangible Net Worth shall exclude non-cash impairments
of long-lived assets as prescribed under Financial Accounting Standards Board
Statements Nos. 19 and 121);
54
62
(b) SENIOR DEBT INTEREST COVERAGE RATIO. A ratio of EBITDA to
Consolidated Interest Expense on Senior Debt for each period of four immediately
preceding consecutive fiscal quarters of at least 3.0 to 1.0;
(c) TOTAL DEBT INTEREST COVERAGE RATIO. For the fiscal quarter
ended June 30, 1999, through the fiscal quarter ending December 31, 1999, a
ratio of EBITDA to Consolidated Interest Expense on Total Debt for each period
of four immediately preceding consecutive fiscal quarters of at least 2.0 to
1.0, and for each fiscal quarter ending after December 31, 1999, a ratio of
EBITDA to Consolidated Interest Expense on Total Debt for each period of four
immediately preceding consecutive fiscal quarters of at least 2.5 to 1.0;
(d) SENIOR DEBT LEVERAGE RATIO. For the fiscal quarter ended
June 30, 1999, through the fiscal quarter ending December 31, 1999, a ratio of
Senior Debt as of the last day of any fiscal quarter to EBITDA for the period of
four immediately preceding fiscal quarters then ended not in excess of 4.0 to
1.0, and for each fiscal quarter ending after December 31, 1999, a ratio of
Senior Debt as of the last day of any fiscal quarter to EBITDA for each period
of four immediately preceding consecutive fiscal quarters then ended not in
excess of 3.0 to 1.0;
(e) TOTAL DEBT LEVERAGE RATIO. For the fiscal quarter ended
June 30, 1999, through the fiscal quarter ending December 31, 1999, a ratio of
Total Debt as of the last day of any fiscal quarter to EBITDA for the period of
four immediately preceding consecutive fiscal quarters then ended not in excess
of 6.0 to 1.0, and for each fiscal quarter ending after December 31, 1999, a
ratio of Total Debt as of the last day of any fiscal quarter to EBITDA for each
period of four immediately preceding consecutive fiscal quarters then ended not
in excess of 5.0 to 1.0; and
(f) CURRENT RATIO. A ratio of current assets to current
liabilities on any date of at least 1.0 to 1.0 (for purposes of this
calculation, current assets will include an amount equal to the Unused
Availability).
ARTICLE 8 - DEFAULT.
8.01. EVENTS OF DEFAULT. As used in this Agreement, the term "EVENT OF
DEFAULT" means the occurrence of any of the following events or existence of any
of the following conditions:
(a) Failure of Borrower to pay when due any principal of any
Note or any reimbursement obligation with respect to any Letters of Credit when
due; or
Amended and Restated Credit Agreement - Page 55
63
(b) Failure of Borrower to pay any accrued interest due and
owing on any Note or any fees or any other amount payable hereunder when due and
the failure shall continue for a period of five days; or
(c) Failure of Borrower to observe or perform any covenant or
agreement contained in SECTION 7.02(C), SECTION 7.03, or SECTION 7.04 of this
Agreement; or
(d) Any default by Borrower or a Subsidiary in the performance
of any other covenant, agreement, obligation, or undertaking contained in this
Agreement or any other Loan Document, any document called for by this Agreement
or any other Loan Document, or any other agreement with any Agent or Lenders
(whether now existing or made hereafter), which is not expressly covered by
another subsection of this SECTION 8.01, and which has not been cured to
Majority Lenders' satisfaction within the earlier to occur of (i) 30 days after
written notice from Administrative Agent to Borrower of the default or (ii) 30
days after the date Borrower should have notified Lenders of the default
pursuant to the terms of this Agreement; or
(e) Any warranty, representation, or statement contained in
this Agreement or made or furnished to Lenders or on behalf of Borrower in
connection with this Agreement or the Loans proves to have been false in any
material respect when made or furnished; or
(f) (i) The default by Borrower or any Subsidiary in the
performance of any obligation owed to someone other than Lenders with respect to
any Debt in excess of $5,000,000, or (ii) the commencement of any foreclosure
proceedings against Borrower or any Subsidiary, if the default has not been
cured or the foreclosure proceeding stopped, to Majority Lenders' satisfaction,
within the earlier to occur of (A) 30 days after written notice from
Administrative Agent to Borrower of the default or (B) 30 days after the date
Borrower should have notified Lenders of the default pursuant to the terms of
this Agreement; or
(g) Borrower's or any Subsidiary's (excluding REFC) voluntary
bankruptcy filing, its liquidation or termination of existence, its merger or
consolidation with another, where Borrower is not the surviving entity, its
insolvency, its forfeiture of right to do business, its appointment of a
custodian, trustee, or receiver for any part of its property, or its assignment
for the benefit of creditors; or
(h) The commencement by a third party of any proceeding under
any bankruptcy or insolvency law against Borrower or any Subsidiary (excluding
REFC) if the proceeding has not been dismissed within 60 days after its
commencement; or
(i) Borrower's failure to remedy a Borrowing Base
Deficiency as required by SECTION 4.06; or
56
64
(j) Any of the following events shall occur or exist with
respect to Borrower and any Commonly Controlled Entity under ERISA: any
Reportable Event shall occur; complete or partial withdrawal from any
Multiemployer Plan shall take place; any Prohibited Transaction shall occur; a
notice of intent to terminate a Plan shall be filed, or a Plan shall be
terminated; or circumstances shall exist which constitute grounds entitling the
PBGC to institute proceedings to terminate a Plan, or the PBGC shall institute
such proceedings; and in each case above, such event or condition, together with
all other events or conditions, if any, could subject Borrower to any tax,
penalty, or other liability which in the aggregate may exceed $2,000,000; or
(k) If any Lender or any Agent receives its first notice of a
material hazardous discharge or a material environmental complaint from a source
other than Borrower (such Lender to immediately notify Administrative Agent and
Borrower thereof) and Administrative Agent does not receive notice (which may be
given in oral form, provided same is followed with all due dispatch by written
notice given to Administrative Agent by certified mail, return receipt
requested) of the hazardous discharge or environmental complaint from Borrower
within 72 hours of the time such Lender or Agent first receives the notice from
a source other than Borrower; or if any federal, state, or local agency asserts
or creates a lien upon any or all of the assets, equipment, property, leaseholds
or other facilities of any Loan Party by reason of the occurrence of a hazardous
discharge or an environmental complaint; or if any federal, state, or local
agency asserts a claim against any Loan Party and/or its assets, equipment,
property, leaseholds, or other facilities for damages or cleanup costs relating
to a hazardous discharge or an environmental complaint; PROVIDED, HOWEVER, THAT
the claim shall not constitute a default if, within five Business Days of the
occurrence giving rise to the claim (a) Borrower can provide to the satisfaction
of each Agent that Borrower has commenced and is diligently pursuing either: (i)
a cure or correction of the event which constitutes the basis for the claim, and
continues diligently to pursue the cure or correction to completion or (ii)
proceedings for an injunction, a restraining order or other appropriate
emergency relief preventing the agency or agencies from asserting such claim,
which relief is granted within ten Business Days of the occurrence giving rise
to the claim and the injunction, order, or emergency relief is not thereafter
resolved or reversed on appeal; and (b) in either of the foregoing events,
Borrower or a Subsidiary has posted a bond, letter of credit, or other security
satisfactory in form, substance, and amount to each Agent and the agency or
entity asserting the claim to secure the proper and complete cure or correction
of the event which constitutes the basis for the claim; or
(l) One or more judgments or orders for the payment of money
aggregating in excess of $1,000,000 shall be rendered against Borrower or any
Subsidiary of Borrower and such judgment or order (i) shall continue unsatisfied
and unstayed (unless bonded with a supersedeas bond at least equal to such
judgment or order) for a period of
Amended and Restated Credit Agreement - Page 57
65
30 days or (ii) is not fully paid and satisfied at least ten days prior to the
date on which any of its assets may be lawfully sold to satisfy such judgment or
order; or
(m) This Agreement or any other Loan Document shall cease to
be in full force and effect or shall be declared null and void or the validity
or enforceability thereof shall be contested or challenged by Borrower or any
Subsidiary of Borrower, or any Borrower or any Subsidiary of Borrower shall deny
that it has any further liability or obligation under any of the Loan Documents,
or any Lien created by the Loan Documents shall for any reason (other than the
release thereof in accordance with the Loan Documents) cease to be a valid,
first priority, perfected Lien upon any of the property purported to be covered
thereby; or
(n) Any Person or group (as defined in Section 13(d)(3) or
14(d)(2) of the Securities Exchange Act of 1934) shall become the direct or
indirect beneficial owner (as defined in Rule 13d-3 under the Securities
Exchange Act of 1934) of more than 35% of the total voting power of all classes
of Equity then outstanding of Borrower entitled (without regard to the
occurrence of any contingency) to vote in elections of directors of Borrower.
8.02. REMEDIES. (a) Upon the occurrence of an Event of Default, and at
any time thereafter, Administrative Agent shall at the request of, or may, with
the consent of, Majority Lenders, by notice to Borrower, (1) declare the
Commitments to be terminated, whereupon the same shall immediately terminate;
(2) declare the outstanding Notes, all interest thereon, and all other amounts
payable under this Agreement, and the other Loan Documents to be immediately due
and payable, whereupon the Notes, all interest, and all other amounts shall
become and be immediately due and payable, without presentment, demand, protest,
notice of intent to accelerate, notice of acceleration, or further notice of any
kind, all of which are hereby expressly waived by Borrower, and (3) exercise all
of their rights and remedies under the Loan Documents; PROVIDED THAT in the case
of the Events of Default specified in SECTION 8.01(g) or (h), without any notice
to Borrower or any other act by Administrative Agent or Lenders, the Commitments
shall thereupon terminate and the Notes (together with accrued interest thereon)
shall become immediately due and payable.
(b) Upon the occurrence and during the continuance of any
Event of Default, each Lender is hereby authorized at any time and from time to
time, without notice to Borrower (any notice being expressly waived by
Borrower), to set off and apply any and all deposits (general or special, time
or demand, provisional or final), excluding those held in Special Accounts, at
any time held and other indebtedness at any time owing by that Lender to or for
the credit or the account of Borrower against any and all of the Obligations of
Borrower now or hereafter existing under this Agreement or any Note held by that
Lender or any other Loan Document, irrespective of whether or not Administrative
Agent or that Lender shall have made any demand under this Agreement or the Note
or such other Loan Document and although the obligations may be unmatured. Each
Lender agrees promptly to notify Borrower (with a copy of
58
66
Administrative Agent) after any set off and application, PROVIDED THAT the
failure to give the notice shall not affect the validity of the set off and
application. The rights of each Lender under this SECTION 8.02(b) are in
addition to the other rights and remedies (including, without limitation, other
rights of set off) which each Lender may have.
(c) Each Lender agrees that if it shall, by exercising any
right of setoff or counterclaim or otherwise, receive payment after the
occurrence and during the continuance of an Event of Default of a proportion of
the aggregate amount of principal and interest due with respect to any Loan
which is greater than the proportion received by any other Lender in respect of
such Loan, Lender receiving such proportionately greater payment shall purchase
such participations in the interests in such Loan held by the other Lenders, and
such other adjustments shall be made, as may be required so that all such
payments of principal and interest with respect to each Loan held by Lenders
shall be shared by Lenders ratably in accordance with their respective
Commitment Percentages; PROVIDED THAT nothing in this SECTION 8.03(c) shall
impair the right of any Lender to exercise any right of setoff or counterclaim
it may have and to apply the amount subject to such exercise to the payment of
indebtedness of Borrower other than its indebtedness under the Loans. Borrower
agrees, to the fullest extent it may effectively do so under applicable law,
that Lenders may exercise rights of setoff or counterclaim and other rights with
respect to such participation as fully as if such holder of a participation were
a direct creditor of Borrower in the amount of such participation.
ARTICLE 9 - AGENCY PROVISIONS.
9.01. APPOINTMENT. Each Lender hereby irrevocably designates and
appoints each of Administrative Agent, Syndication Agent, and Documentation
Agent as its Agent under this Agreement and the other Loan Documents, and each
Lender irrevocably authorizes Agents, in those capacities, to take all action on
its behalf under the provisions of this Agreement and the other Loan Documents
and to exercise all powers and perform all duties as are expressly delegated to
Agents by the terms of this Agreement and the other Loan Documents, together
with all other powers as are reasonably incidental thereto. Notwithstanding any
provision to the contrary contained elsewhere in this Agreement, Agents shall
not have any duties or responsibilities except those expressly set forth herein,
or any fiduciary relationship with any Lender, and no implied covenants,
functions, responsibilities, duties, obligations or liabilities shall be read
into this Agreement or any other Loan Document or otherwise exist against
Agents.
9.02. DELEGATION OF DUTIES. Each Agent may execute any of its duties
under this Agreement and the other Loan Documents by or through agents or
attorneys-in-fact and shall be entitled to advice of counsel concerning all
matters pertaining to the duties. Agents shall not be responsible for the
negligence or misconduct of any agents or attorneys in-fact selected by it with
reasonable care.
Amended and Restated Credit Agreement - Page 59
67
9.03. EXCULPATORY PROVISIONS. No Agent or any of its officers,
directors, employees, agents, attorneys-in-fact or Affiliates shall be (i)
liable for any action lawfully taken or omitted to be taken by it or such Person
under or in connection with this Agreement or any other Loan Document (except
for its or that Person's own gross negligence or willful misconduct) or (ii)
responsible in any manner to any Lender for any recitals, statements,
representations or warranties made by any Loan Party or any officer thereof
contained in this Agreement or any other Loan Document or in any certificate,
report, statement or other document referred to or provided for in, or received
by Agents under or in connection with, this Agreement or any other Loan Document
or for the value, validity, effectiveness, genuineness, enforceability or
sufficiency of this Agreement or any other Loan Document or for any failure of
any Loan Party to perform its obligations hereunder or thereunder. Agents shall
not be under any obligation to any Lender to ascertain or to inquire as to the
observance or performance of any of the agreements contained in, or conditions
of, this Agreement or any other Loan Document, or to inspect the properties,
books or records of any Loan Party.
9.04. RELIANCE BY AGENTS. Agents shall be entitled to rely, and shall
be fully protected in relying, upon any Note, writing, resolution, notice,
consent, certificate, affidavit, letter, telecopy, telex or teletype message,
statement, order or other document or conversation believed by it to be genuine
and correct and to have been signed, sent or made by the proper Person or
Persons and upon advice and statements of legal counsel (including, without
limitation, counsel to the Loan Parties), independent accountants and other
experts selected by each Agent. The Agents may deem and treat the payee of any
Note as the owner thereof for all purposes unless a written notice of
assignment, negotiation or transfer thereof shall have been filed with
Administrative Agent. Agents shall be fully justified in failing or refusing to
take any action under this Agreement or any other Loan Document unless it shall
first receive the advice or concurrence of Required Lenders or Majority Lenders,
as applicable, as it deems appropriate or it shall first be indemnified to its
satisfaction by Lenders against any and all liability and expense which may be
incurred by it by reason of taking or continuing to take any action. Agents
shall in all cases be fully protected in acting, or in refraining from acting,
under this Agreement and the other Loan Documents in accordance with a request
of Required Lenders, and the request and any action taken or failure to act
pursuant thereto shall be binding upon all Lenders and all future holders of the
Loans.
9.05. NOTICE OF DEFAULT. No Agent shall be deemed to have knowledge or
notice of the occurrence of any Default or Event of Default hereunder unless
such Agent has received notice from a Lender or Borrower referring to this
Agreement, describing the Default or Event of Default and stating that the
notice is a "notice of default". In the event that any Agent receives such a
notice, such Agent shall give notice thereof to each other Agent and each other
Lender. Administrative Agent shall take action with respect to the Default or
Event of Default as shall be reasonably directed by Majority Lenders; PROVIDED
THAT unless and until Administrative Agent shall have received these directions,
Administrative Agent may (but shall not be obligated to) take action, or refrain
from
60
68
taking action, with respect to the Default or Event of Default as it shall
deem advisable in the best interests of Lenders.
9.06. NON-RELIANCE ON AGENTS AND OTHER LENDERS. Each Lender expressly
acknowledges that neither Agents nor any of their officers, directors,
employees, agents, attorneys-in-fact or Affiliates has made any representations
or warranties to it and that no act by Agents hereafter taken, including any
review of the affairs of any Loan Party, shall be deemed to constitute any
representation or warranty by Agents to any Lender. Each Lender represents to
Agents that it has, independently and without reliance upon Agents or any other
Lender, and based on such documents and information as it has deemed
appropriate, made its own appraisal of and investigation into the business,
operations, property, financial and other condition and creditworthiness of each
Loan Party and made its own decision to make its extensions of credit hereunder
and enter into this Agreement. Each Lender also represents that it will,
independently and without reliance upon Agents or any other Lender, and based on
such documents and information as it shall deem appropriate at the time,
continue to make its own credit analysis, appraisals and decisions in taking or
not taking action under this Agreement and the other Loan Documents, and to make
such investigation as it deems necessary to inform itself as to the business,
operations, property, financial and other condition and creditworthiness of each
Loan Party. Except for notices, reports, and other documents expressly required
to be furnished to Lenders by Administrative Agent hereunder, no Agent shall
have any duty or responsibility to provide any Lender with any credit or other
information concerning the business, operations, property, condition (financial
or otherwise), prospects or creditworthiness of any Loan Party which may come
into the possession of Administrative Agent or any of its officers, directors,
employees, agents, attorneys-in-fact or Affiliates.
9.07. INDEMNIFICATION. Lenders agree to indemnify each Agent in its
capacity as such (to the extent not reimbursed by Borrower and without limiting
the obligation of Borrower to do so), ratably according to their respective
Commitment Percentages in effect on the date on which indemnification is sought,
from and against any and all liabilities, obligations, losses, damages,
penalties, actions, judgments, suits, costs, expenses or disbursements of any
kind whatsoever which may at any time (including, without limitation, at any
time following the payment of the Obligations) be imposed on, incurred by or
asserted against any Agent in any way relating to or arising out of, the Total
Commitment, this Agreement, any of the other Loan Documents or any documents
contemplated by or referred to herein or therein or the transactions
contemplated hereby or thereby or any action taken or omitted by each Agent
under or in connection with any of the foregoing; PROVIDED THAT no Lender shall
be liable for the payment of any portion of the liabilities, obligations,
losses, damages, penalties, actions, judgments, suits, costs, expenses, or
disbursements resulting solely from an Agent's gross negligence or willful
misconduct. The agreements in this subsection shall survive the payment of the
Obligations and all other amounts payable hereunder.
Amended and Restated Credit Agreement - Page 61
69
9.08. EACH AGENT IN ITS INDIVIDUAL CAPACITY. Each Agent and its
Affiliates may make loans to, accept deposits from, and generally engage in any
kind of business with any Loan Party as though such Agent were not an Agent
hereunder and under the other Loan Documents. With respect to the extensions of
credit made by it, each Agent shall have the same rights and powers under this
Agreement and the other Loan Documents as any Lender and may exercise the same
as though it were not an Agent, and the terms "Lender" and "Lenders" shall
include each Agent in its individual capacity.
9.09. SUCCESSOR AGENT. Each Agent may resign as Agent upon written
notice to Lenders and the appointment of a Successor Agent as set out in the
following sentence. If an Agent shall resign as Agent under this Agreement and
the other Loan Documents, then Required Lenders shall appoint from among Lenders
a successor agent for Lenders, which successor agent, with the consent of
Borrower (the consent not to be unreasonably withheld or delayed), shall succeed
to the rights, powers and duties of such Agent hereunder. Effective upon the
appointment and approval, the term "Agent" shall mean the successor agent
(serving in the capacity of the predecessor Agent), and the former Agent's
rights, powers and duties as Agent shall be terminated, without any other or
further act or deed on the part of the former Agent or any of the parties to
this Agreement or any holders of the Loans. After any retiring Agent's
resignation as Agent, the provisions of this Article 9 shall inure to its
benefit as to any actions taken or omitted to be taken by it while it was Agent
under this Agreement and the other Loan Documents.
9.10. ISSUING LENDER. The provisions of this Article 9 applicable to an
Agent shall apply to the Issuing Lender in the performance of its duties under
the Loan Documents, allowing for the appropriate changes that must be made.
62
70
ARTICLE 10 - PROTECTION OF YIELD; CHANGE IN LAWS.
10.01. RISK-BASED CAPITAL. In the event any Lender determines that (a)
compliance with any judicial, administrative, or other governmental
interpretation of any law or regulation adopted or made after the date hereof,
or (b) compliance by such Lender or any corporation controlling such Lender with
any guideline or request from any central bank or other Governmental Authority
(whether or not having the force of law) adopted or made after the date hereof
has the effect of requiring an increase in the amount of capital required or
expected to be maintained by such Lender or any corporation controlling the
Lender, and such Lender determines that the increase is based upon its
obligations hereunder, Borrower shall pay to Administrative Agent, for the
account of the applicable Lender, the additional amount as shall be certified by
that Lender to be the amount allocable to such Lender's obligations to Borrower
hereunder. Such Lender will promptly notify Borrower (with a copy to
Administrative Agent) of any event occurring after the date of this Agreement
that will entitle that Lender to compensation pursuant to this SECTION 10.01 as
promptly as practicable, and in any event within 90 days after it obtains
knowledge thereof and determines to request the compensation.
Borrower's obligations under this Section 10.01 shall be
subject to delivery to Borrower by any Lender claiming compensation under this
Section 10.01 of a certificate setting forth in reasonable detail the additional
amount or amounts to be paid to it hereunder and certifying that it is generally
charging such costs to other similarity situated borrowers under similar credit
facilities.
Determinations by a Lender for purposes of this SECTION 10.01
of the effect of any increase in the amount of capital required to be maintained
by such Lender and of the amount allocable to that Lender's obligations to
Borrower hereunder shall be conclusive, absent manifest error.
10.02. BASIS FOR DETERMINING INTEREST RATE APPLICABLE TO EURODOLLAR
LOANS INADEQUATE. If on or prior to the first day of any Interest Period:
(a) Administrative Agent is advised that deposits in dollars
(in the applicable amounts) are not being offered to Lenders in the interbank
eurocurrency market for the Interest Period, or
(b) Administrative Agent determines that the Eurodollar Rate
as determined by it will not adequately and fairly reflect the cost to Lenders
of funding a Eurodollar Loan for the Interest Period; or
(c) Adequate means do not exist in the interbank eurocurrency
market to determine the Eurodollar Rate;
Amended and Restated Credit Agreement - Page 63
71
the obligation of Lenders to make Eurodollar Loans shall be suspended until
Administrative Agent notifies Borrower that the circumstances giving rise to the
suspension no longer exist. Unless Borrower notifies Administrative Agent at
least two Business Days before the date of any Eurodollar Loan previously
requested that it elects not to borrow on that date, the Loan shall instead be
made as a ABR Loan.
10.03. ILLEGALITY OF EURODOLLAR LOANS. (a) If, after the date of this
Agreement, the adoption of any applicable law, rule or regulation, or any change
therein, or any change in the interpretation or administration thereof by any
Governmental Authority, central Bank or comparable agency charged with the
interpretation or administration thereof, or compliance by any Lender (or its
Lending Office) with any request or directive (whether or not having the force
of law) of any the authority, central Bank, or comparable agency shall make it
unlawful or impossible for that Lender (or its Lending Office) to make, maintain
or fund its Eurodollar Loans, the obligation of such Lender to make Eurodollar
Loans shall be suspended. If any Lender determines that it may not lawfully
continue to maintain and fund any of its outstanding Eurodollar Loans to
maturity, Borrower shall immediately convert the principal amount of each
Eurodollar Loan to an ABR Loan of an equal principal amount from such Lender.
(b) No Lender shall be required to make a Loan hereunder if
the making of the Loan would be in violation of any law applicable to such
Lender.
10.04. INCREASED COST OF EURODOLLAR LOANS. If after the date hereof,
the adoption of any applicable law, rule or regulation, or any change therein,
or any change in the interpretation or administration hereof by any Governmental
Authority, central bank or comparable agency charged with the interpretation or
administration thereof, or compliance by any Lender with any request or
directive (whether or not having the force of law) of any that authority,
central bank, or comparable agency:
(a) shall subject such Lender to any tax, duty or other charge
with respect to its Eurodollar Loans or its obligation to make Eurodollar Loans
or shall change the basis of taxation of payments to a Lender of the principal
of or interest on its Eurodollar Loans or any other amounts due under this
Agreement in respect of its Eurodollar Loans or its obligation to make
Eurodollar Loans (except for changes in the rate of tax on the overall net
income of a Lender imposed by the jurisdiction in which such Lender's Lending
Office is located); or
(b) shall impose, modify or deem applicable any reserve,
special deposit or similar requirement [including, without limitation, any
requirement imposed by the Board of Governors of the Federal Reserve System (but
excluding with respect to any Eurodollar Loan any requirement included in an
applicable Eurodollar Reserve Percentage)] against assets of, deposits with or
for the account of or credit extended by such Lender or shall impose on such
Lender or the eurodollar interbank market any other
64
72
condition affecting the Eurodollar Loans, any Note or such Lender's obligation
to make Eurodollar Loans;
and the result of any of the foregoing is to increase the cost to such Lender of
making or maintaining any Eurodollar Loan, or to reduce the amount of any sum
received or receivable by that Lender under this Agreement or under the Note
with respect thereto, by an amount deemed by the Lender to be material, then,
within 10 days after demand by Administrative Agent, Borrower shall pay to that
Lender the additional amount or amounts as will compensate that Lender for the
increased cost or reduction. Each Lender will promptly notify Borrower and
Administrative Agent of any event of which it has knowledge, occurring after the
date hereof, which will entitle such Lender to compensation pursuant to this
SECTION 10.04 and will designate a different Lending Office if the designation
will avoid the need for, or reduce the amount of, such compensation and will
not, in the reasonable judgment of that Lender, be otherwise disadvantageous to
the Lender. Borrower's obligations under this SECTION 10.04 shall be subject to
delivery to Borrower of a certificate by any Lender claiming compensation under
this SECTION 10.04, setting forth in reasonable detail the additional amount or
amounts to be paid to it hereunder and certifying that it is generally charging
such costs to other similarly situated borrowers under similar credit facilities
shall be delivered to Borrower and shall be conclusive in the absence of
manifest error. In determining the amount, each Lender must use reasonable
averaging and attribution methods.
10.05. ALTERNATIVE LOANS SUBSTITUTED FOR AFFECTED EURODOLLAR LOANS. If
(a) the obligation of any Lender to make Eurodollar Loans has been suspended
pursuant to SECTION 10.03 or (b) such Lender has demanded compensation under
SECTION 10.04, and Borrower shall, by at least five Business Days prior notice
to such Lender, have elected that the provisions of this SECTION 10.05 shall
apply, then, unless and until such Lender notifies Borrower that the
circumstances giving rise to the suspension or demand for compensation no longer
apply:
(i) all Loans which would otherwise be made by such
Lender as Eurodollar Loans shall be made instead as ABR Loans, and
(ii) after each of its Eurodollar Loans has been
repaid, all payments of principal which would otherwise be applied to repay the
Eurodollar Loans shall be applied to repay its ABR Loans.
10.06. FUNDING LOSS INDEMNIFICATION. Upon notice to Borrower from a
Lender (with a copy to Administrative Agent), Borrower shall pay to
Administrative Agent, within five days after notice from a Lender, for the
ratable benefit of each Lender, the amount or amounts sufficient to compensate
them for any actual loss, cost, or expense (excluding loss of anticipated
profits) incurred as a result of:
Amended and Restated Credit Agreement - Page 65
73
(a) Any payment of a Eurodollar Loan on a date other than the
last day of the Interest Period for the Loan including, but not limited to,
acceleration of the Loans by Administrative Agent pursuant to this Agreement, or
(b) Any failure by Borrower to borrow or convert, as the case
may be, a Eurodollar Loan on the date for borrowing or conversion, as the case
may be, specified in the relevant notice under SECTION 2.02 or 2.07, as the case
may be.
Each Lender shall determine the amount of compensation and will provide Borrower
with the basis for its determination. Each Lender's determination shall be
conclusive, absent manifest error.
10.07. TAXES. All amounts payable by Borrower under the Loan Documents
(whether principal, interest, fees, expenses, or otherwise) to or for the
account of each Lender shall be paid in full, free of any deductions or
withholdings for or on account of any Taxes. If Borrower is prohibited by law
from paying the amount free of any deductions and withholdings, then (at the
same time and in the same manner that the original amount is otherwise due under
the Loan Documents), Borrower shall pay to or for the account of such Lender
such additional amount as may be necessary in order that the actual amount
received by such Lender after deduction and/or withholding (and after payment of
any additional Taxes due as a consequence of the payment of the additional
amount, and so on) will equal the amount such Lender would have received if the
deduction or withholding were not made.
10.08. DISCRETION OF LENDERS AS TO MANNER OF FUNDING. Notwithstanding
any provisions of this Agreement to the contrary, each Lender shall be entitled
to fund and maintain its funding of all or any part of its Loans in any manner
it sees fit, it being understood, however, that for the purposes of this
Agreement all determinations hereunder shall be made as if such Lender had
actually funded and maintained each Eurodollar Loan during the Interest Period
for the Eurodollar Loan through the purchase of deposits having a maturity
corresponding to the last day of the Interest Period and bearing an interest
rate equal to the Eurodollar Rate for the Interest Period.
10.09. LIMITATION ON ADDITIONAL AMOUNTS. Notwithstanding anything to
the contrary contained in SECTION 10.01, 10.04, and 10.07, neither Borrower nor
any Subsidiary of Borrower shall be required to pay to any Lender any increased
costs, Taxes, loss, expense, or liability, reduction in amounts received or
receivable or reduction in return on capital incurred more than 180 days prior
to the date that such Lender notifies Borrower of such Lender's intention to
claim any such compensation; PROVIDED THAT if the circumstances giving rise to
such claim have a retroactive effect, then such 180 day period shall be extended
to include the period of such retroactive effect.
10.10. REPLACEMENT LENDERS. (a) If any Lender has notified Borrower
and Administrative Agent of its incurring additional costs under SECTIONS 10.01
or 10.04, or has required Borrower
66
74
to make payments for Taxes under SECTION 10.07, then Borrower may, unless such
Lender has notified Borrower and Administrative Agent that the circumstances
giving rise to such notice no longer apply, terminate, in whole but not in part,
the Commitment of any Lender (other than Administrative Agent) (the "TERMINATED
LENDER") at any time upon five Business Days prior written notice to the
Terminated Lender and Administrative Agent (such notice referred to herein as a
"NOTICE OF TERMINATION").
(b) In order to effect the termination of the Commitment of
the Terminated Lender, Borrower shall: (i) obtain an agreement with one or more
Lenders to increase their Commitment or Commitments and/or (ii) request any one
or more other banking institutions to become parties to this Agreement in place
and instead of such Terminated Lender and agree to accept a Commitment or
Commitments; PROVIDED, HOWEVER, THAT such one or more other banking institutions
(referred to herein as the "REPLACEMENT LENDERS") agree to accept in whole or in
part the Commitment of the Terminated Lender, are reasonably acceptable to all
Agents, and become parties to this Agreement by executing an assignment in the
form of attached EXHIBIT H, with appropriate insertions and modifications (an
"ASSIGNMENT"), such that the aggregate increased and/or accepted Commitments of
the Replacement Lenders under clauses (i) and (ii) above equal the Commitment of
the Terminated Lender.
(c) The Notice of Termination shall include the name of the
Terminated Lender, the date the termination will occur (the "LENDER TERMINATION
DATE"), and the Replacement Lender or Replacement Lenders to which the
Terminated Lender will assign its Commitment and, if there will be more than one
Replacement Lender, the portion of the Terminated Lender's Commitment to be
assigned to each Replacement Lender.
(d) On the Lender Termination Date, (i) the Terminated Lender
shall by execution and delivery of an Assignment assign its Commitment to the
Replacement Lender or Replacement Lenders (pro rata, if there is more than one
Replacement Lender, in proportion to the portion of the Terminated Lender's
Commitment to be assigned to each Replacement Lender) indicated in the Notice of
Termination and shall assign to the Replacement Lender or Replacement Lenders
each of its Loan (if any) then outstanding and participation interests in
Letters of Credit (if any) then outstanding pro rata as aforesaid), (ii) the
Terminated Lender shall endorse its Note, payable without recourse,
representation or warranty to the order of the Replacement Lender or Replacement
Lenders (pro rata as aforesaid), (iii) the Replacement Lender or Replacement
Lenders shall purchase the Note held by the Terminated Lender (pro rata as
aforesaid) at a price equal to the unpaid principal amount thereof plus interest
and facility and other fees accrued and unpaid to the Termination Date, and (iv)
the Replacement Lender or Replacement Lenders will thereupon (pro rata as
aforesaid) succeed to and be substituted in all respects for the Terminated
Lender with like effect as if becoming a Lender pursuant to the terms of SECTION
12.08(b), and the Terminated Lender will have the rights
Amended and Restated Credit Agreement - Page 67
75
and benefits of an assignor under SECTION 12.08(b). To the extent not in
conflict, the terms of SECTION 12.08(B) shall supplement the provisions of this
SECTION 10.10(d). For each assignment made under this SECTION 10.10, the
Replacement Lender shall pay to Administrative Agent any processing fee provided
for in SECTION 12.08(b). Borrower shall pay any breakage costs as provided by
SECTION 10.06, which occur as a result of the operation of this SECTION 10.10.
ARTICLE 11 - FEES.
11.01 COMMITMENT FEES. On the first day of each October, January,
April, and July, commencing on October 1, 1999, and ending on the Termination
Date or any earlier termination of the Commitments, Borrower shall pay to
Administrative Agent for the ratable benefit of each Lender, a commitment fee
payable with respect to the daily Unused Availability for the calendar quarter
(or portion thereof) ending on the day prior to the date such payment is due
equal to (i) .25% per annum of the average daily Unused Availability for such
calendar quarter or portion thereof if the daily average Borrowing Base Usage
during such calendar quarter (or portion thereof) is less than 40% for the
calendar quarter ending on the date immediately preceding the date such
commitment fee is payable; (ii) .375% per annum of the average daily Unused
Availability for such calendar quarter or portion thereof if the average daily
Borrowing Base Usage during such calendar quarter (or portion thereof) is equal
to or greater than 40% but less than 60% for the calendar quarter ending on the
day immediately preceding the date such commitment fee is payable; and (iii)
.50% per annum of the average daily Unused Availability for such calendar
quarter or portion thereof if the average daily Borrowing Base Usage during such
calendar quarter (or portion thereof) is equal to or greater than 60% for the
calendar quarter ending on the day immediately preceding the date such
commitment fee is payable. The commitment fees payable pursuant to this SECTION
11.01 shall be calculated on the basis of the actual number of days elapsed
assuming a calendar year of 360 days.
11.02. AGENCY FEES. Borrower shall pay to each Agent and its Affiliates
those fees and other amounts as Borrower shall be required to pay to each Agent
and its Affiliates from time to time pursuant to any separate agreement between
Borrower and that Agent or any of its Affiliates setting forth the compensation
to be paid to such Agent and its Affiliates in consideration for acting as Agent
hereunder and for providing other services in connection with the credit
facilitations provided pursuant hereto. These fees and other amounts shall be
retained by the applicable Agent and its Affiliates, and no Lender (other than
the applicable Agents) shall have any interest therein.
11.03. LETTER OF CREDIT FEES. Borrower shall pay to Administrative
Agent, for the ratable benefit of each Lender, and to the Issuing Lender, as
appropriate, the fees provided for in SECTION 3.03 with respect to all Letters
of Credit issued.
68
76
11.04. OTHER FEES. Borrower shall pay to Administrative Agent, for the
ratable benefit of each Lender, those fees and other amounts as Borrower shall
be required to pay to each Lender from time to time pursuant to any separate
agreement between Borrower and Administrative Agent, for the ratable benefit of
each Lender, setting forth the compensation to be paid to Lenders in
consideration for participating in the credit facilitations provided pursuant
hereto.
ARTICLE 12 - GENERAL PROVISIONS.
12.01. EXPENSES. Borrower shall pay (i) all reasonable out-of-pocket
expenses of Syndication Agent associated with the syndication of the Loans, (ii)
all reasonable out-of-pocket expenses of Syndication Agent, including reasonable
fees, disbursements and other charges of counsel for Syndication Agent, in
connection with the preparation of this Agreement and the other Loan Documents
and, if appropriate, the recordation of the Loan Documents, (iii) all reasonable
out-of-pocket expenses of Administrative Agent, including reasonable fees,
disbursements, and other charges of counsel for Administrative Agent, in
connection with the preparation of any waiver or consent under this Agreement or
any amendment hereof or any default or alleged default hereunder, (iv) all
reasonable out-of-pocket expenses of preparing, obtaining, and furnishing to any
Agent or any Lender any statements, opinions, certificates, schedules,
documents, insurance policies, and all other items required to furnished to any
Agent or any Lender pursuant to this Agreement or any request made pursuant to
this Agreement or any other Loan Document, and (v) if an Event of Default
occurs, all out-of-pocket expenses incurred by Administrative Agent or any
Lender, including the fees, disbursements and other charges of counsel in
connection with such Event of Default and collection and other enforcement
proceedings resulting therefrom, fees of auditors and consultants incurred in
connection therewith and investigation expenses incurred by Administrative Agent
or any Lender in connection therewith.
12.02. NON-WAIVER. No act, delay, omission, or course of dealing will
be a waiver of any of a Lender's rights or remedies under this Agreement or
otherwise, and no waiver, change, or modification in whole or in part of this
Agreement, any Note, or any other agreement will be effective unless in a
writing signed by Borrower and Lenders. All rights and remedies of Lenders are
cumulative and may be exercised singly or concurrently. A waiver by Lenders of
any right or remedy on any occasion will not be a bar to the exercise of any
right or remedy on any subsequent occasion.
12.03. AMENDMENT AND WAIVERS. Any provision of this Agreement, the
Notes or the other Loan Documents may be amended or waived if, but only if such
amendment or waiver is in writing and is signed by Borrower and Majority Lenders
(and, if the rights or duties of Administrative Agent are affected thereby, by
Administrative Agent); PROVIDED THAT no amendment or waiver shall, unless signed
by all Lenders, (a) modify the voting percentages of Lenders, (b) release a
guarantor or any part of the Collateral (other
Amended and Restated Credit Agreement - Page 69
77
than as contemplated hereby), (c) amend or waive any of the provisions of
ARTICLE 4 or the definitions contained in SECTION 1.01 applicable thereto, or
(d) change the definitions of Majority Lenders or Required Lenders; and FURTHER
PROVIDED THAT no amendment or waiver shall, unless signed by each Lender
directly affected thereby, (i) increase the Commitment of such Lender or subject
any Lender to any additional obligation, (ii) forgive any of the principal of or
reduce the rate of interest on any Loan or any fees hereunder, (iii) postpone
the date fixed for any payment of principal of or interest on any Loan or any
fees hereunder, (iv) change a Lender's Commitment Percentage except as otherwise
provided for in this Agreement, or (v) change the number or percentage of
Lenders required to take any action under this SECTION 12.03 or any other
provision of this Agreement.
12.04. SURVIVAL. All representations, warranties, and covenants made by
Borrower herein or in any certificate or other instrument delivered by it or in
its behalf under the Loan Documents shall be considered to have been relied upon
by Lenders and shall survive the delivery to Lenders of the Loan Documents or
the extension of the Loans (or any part thereof), regardless of any
investigation made by or on behalf of Lenders.
12.05. LIMITATION ON INTEREST. Regardless of any provision contained in
the Loan Documents, Lenders shall never be entitled to contract for, charge,
receive, collect, or apply, as interest on the Loans, any amount in excess of
the Maximum Lawful Rate, and in the event Lenders ever contract for, charge,
receive, collect or apply as interest any excess, the amount which would be
deemed excessive interest shall be deemed a partial prepayment of principal and
treated hereunder as such; and if the Loans are paid in full, any remaining
excess shall promptly be paid to Borrower. In determining whether or not the
interest paid or payable under any specific contingency exceeds the Maximum
Lawful Rate, Borrower and Lenders shall, to the extent permitted under
applicable law, (a) characterize any nonprincipal payment as an expense, fee or
premium rather than as interest, (b) exclude voluntary prepayments and the
effects thereof and (c) amortize, prorate, allocate and spread, in equal parts,
the total amount of the interest throughout the entire contemplated term of the
Notes, so that the interest rate is the Maximum Lawful Rate throughout the
entire term of the Notes; PROVIDED, HOWEVER, THAT if the unpaid principal
balance thereof is paid and performed in full prior to the end of the full
contemplated term thereof, and if the interest contracted for, charged or
received for the actual period of existence thereof exceeds the Maximum Lawful
Rate, Lenders shall refund to Borrower or any Subsidiary, as appropriate, the
amount of the excess and, in that event, Lenders shall, to the fullest extent
permitted under applicable law, not be subject to any penalties provided by any
laws for contracting for, charging, taking, reserving or receiving interest in
excess of the Maximum Lawful Rate.
12.06. INVALID PROVISIONS. If any provision of the Loan Documents is
held to be illegal, invalid, or unenforceable under present or future laws
effective during the term thereof, the provision shall be fully severable, the
Loan Documents shall be construed
70
78
and enforced as if the illegal, invalid, or unenforceable provision had never
comprised a part thereof, and the remaining provisions thereof shall remain in
full force and effect and shall not be affected by the illegal, invalid, or
unenforceable provision or by its severance therefrom. Furthermore, in lieu of
the illegal, invalid, or unenforceable provision there shall be added
automatically as a part of the Loan Documents a provision as similar in terms to
the illegal, invalid, or unenforceable provision as may be possible and be
legal, valid and enforceable.
12.07. WAIVER OF CONSUMER CREDIT LAW. Pursuant to Article 15.10(b) of
Chapter 15, Subtitle 79, Revised Civil Statutes of Texas, 1925, as amended,
Borrower agrees that Chapter 15 shall not govern or in any manner apply to the
Loans.
12.08. SUCCESSORS AND ASSIGNS. (a) The provisions of this Agreement
shall be binding upon and inure to the benefit of the parties hereto and their
respective successors and assigns, except that Borrower may not assign or
otherwise transfer any of its rights under this Agreement.
(b) Each Lender may transfer or assign all or any part of its
interest in Loans and its interest herein to any of its Affiliates regardless of
the term of the transfer or assignment. Each Lender may transfer or assign all
or any part of its interest in Loans to any commercial bank which is a member of
the Federal Reserve System and has combined capital and surplus and undivided
profits of not less than $100,000,000. Notwithstanding the foregoing, no Lender
shall transfer or assign all or any part of its Loans under this Agreement to
any Person other than an Affiliate of such Lender without the prior written
approval of Borrower and Agents, the approval to not be unreasonably withheld;
PROVIDED THAT Borrower's consent will not be required if a Default or Event of
Default has occurred and is continuing. As to each assignment of Loans permitted
by this Agreement, Borrower releases the assigning Lender from its obligations
under this Agreement as to the portion of the Loans assigned.
(c) Any Lender may (subject to the provisions of this section,
in accordance with applicable law, in the ordinary course of its business, and
at any time) sell to one or more Persons participating interests in its portion
of the Obligations. The seller Lender remains a "Lender" under the Loan, the
participant does not become a "Lender" under the Loan Documents, and the selling
Lender's obligations under the Loan Documents remain unchanged. The selling
Lender remains solely responsible for the performance of its obligations and
remains the holder of its share of the outstanding Loan for all purposes under
the Loan Documents. Borrower and each Agent shall continue to deal solely and
directly with the selling Lender in connection with that Lender's rights and
obligations under the Loan Documents, and each Lender must retain the sole right
and responsibility to enforce due obligations of Borrower. Participants have no
rights under the Loan Documents except certain voting rights as provided below.
Amended and Restated Credit Agreement - Page 71
79
No Lender may sell any participating interest under which the participant has
any rights to approve any amendment, modification, or waiver of any Loan
Document except as to matters requiring the approval of all Lenders as set forth
in SECTION 12.03.
(d) Each Lender shall have the right to disclose any
information in its possession regarding Borrower or any Subsidiary, or regarding
the Collateral, to any transferee, participant, potential transferee, or
potential participant of any of the Loans or any part thereof; PROVIDED THAT
such Persons agree to be bound by the provisions of SECTION 12.16.
(e) Nothing herein shall prohibit a Lender from pledging or
assigning any Note to any Federal Reserve Bank in accordance with applicable
law.
12.09. FOREIGN LENDERS, PARTICIPANTS, AND ASSIGNEES. Each Lender,
participant (by accepting a participation interest under this Agreement), and
assignee (by executing an assignment and assumption agreement in a form
acceptable to Agents) that is not organized under the laws of the United States
of America or one of its states (a) represents to Administrative Agent and
Borrower that (i) no Taxes assessed by any Governmental Authority in the United
States are required to be withheld by Administrative Agent or Borrower with
respect to any payments to be made to it in respect of the Obligations and (ii)
it has furnished to Administrative Agent and Borrower two duly completed copies
of either U. S. Internal Revenue Service Form 4224, Form 1006, Form W-8, or
other form acceptable to Administrative Agent that entitles it to exemption from
U.S. federal withholding Tax on all interest payments under the Loan Documents,
and (b) covenants to (i) provide Administrative Agent and Borrower a new Form
4224, Form 1001, Form W-8, or other form acceptable to Administrative Agent upon
the expiration or obsolescence of any previously delivered form according to
applicable laws and regulations, duly executed and completed by it, and (ii)
comply from time to time with all applicable laws and regulations with regard to
the withholding Tax exemption. If any of the foregoing is not true or the
applicable forms are not provided, then Borrower and Administrative Agent
(without duplication) may deduct and withhold from interest payments under the
Loan Documents any United States federal income Tax at the maximum rate under
the Code without reimbursement pursuant to SECTION 10.07.
12.10. NOTICES. All notices, requests, or other communications required
or permitted to be given by this Agreement or any other Loan Documents must be
in writing (including by facsimile transmission) and unless otherwise expressly
provided herein, shall be deemed to have been duly given or made (a) in the case
of delivery by hand or by courier service, when delivered, (b) in the case of
delivery by mail, three Business Days after being deposited in the mails,
postage prepaid, or (c) in the case of delivery by facsimile transmission, when
sent and receipt has been confirmed, addressed as follows in the case of
Borrower and Agents, and as set forth in SCHEDULE 2 in the case of the other
parties hereto, or to such other address as may be hereafter notified by the
representative parties hereto:
72
80
Borrower: Range Resources Corporation
▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇
Fax No.: (▇▇▇) ▇▇▇-▇▇▇▇
Administrative Agent: Bank One, Texas, N.A.
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Attention: W. ▇▇▇▇ ▇▇▇▇▇▇▇
Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇
Fax No.: (▇▇▇) ▇▇▇-▇▇▇▇
Syndication Agent: Chase Bank of Texas, N.A.
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attn: ▇▇▇▇ ▇. ▇▇▇▇
Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇
Fax No.: (▇▇▇) ▇▇▇-▇▇▇▇
Documentation Agent: Bank of America, N.A.
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attn: J. ▇▇▇▇▇ ▇▇▇▇▇▇
Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇
Fax No.: (▇▇▇) ▇▇▇-▇▇▇▇
Notwithstanding the foregoing, any notice, request, or demand to or upon
Administrative Agent or Lenders pursuant to SECTIONS 2.02, 2.07, or 2.09 shall
not be effective until received.
12.11. REPORTS AND CERTIFICATES. All reports and certificates of
Borrower required by this Agreement must be in form and substance satisfactory
to Administrative Agent and made under oath before a notary public by an
authorized corporate officer or representative of Borrower.
12.12. GOVERNING LAW. THIS AGREEMENT WILL BE GOVERNED BY AND CONSTRUED
IN ACCORDANCE WITH THE LAWS OF THE STATE OF TEXAS AND THE APPLICABLE LAWS OF THE
UNITED STATES OF AMERICA AND SHALL BE PERFORMED IN TARRANT COUNTY, TEXAS.
Amended and Restated Credit Agreement - Page 73
81
12.13. COMPLETE AGREEMENT. THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS
REPRESENT THE FINAL AGREEMENT AMONG LENDERS, AGENTS, AND BORROWER AND MAY NOT BE
CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS, OR SUBSEQUENT ORAL
AGREEMENTS OF LENDERS, AGENTS, OR BORROWER. THERE ARE NO UNWRITTEN ORAL
AGREEMENTS BETWEEN LENDERS, AGENTS, AND BORROWER.
12.14. WAIVER OF JURY TRIAL. BORROWER , AGENTS, AND LENDERS HEREBY
IRREVOCABLY AND UNCONDITIONALLY WAIVE TRIAL BY JURY IN ANY LEGAL ACTION OR
PROCEEDING RELATING TO THIS AGREEMENT OR ANY OF THE OTHER LOAN DOCUMENTS AND FOR
ANY COUNTERCLAIM THEREIN.
12.15. COUNTERPARTS; EFFECTIVENESS. This Agreement may be signed in any
number of counterparts, each of which shall be an original, with the same effect
as if the signatures thereto and hereto were upon the same instrument. This
Agreement shall become effective when Administrative Agent shall have received
counterparts hereof signed by all of the parties hereto or, in the case of any
Lender as to which an executed counterpart shall not have been received,
Administrative Agent shall have received telegraphic or other written
confirmation from that Lender of execution of a counterpart hereof by that
Lender.
12.16. CONFIDENTIALITY. In the event that Borrower provides to
Administrative Agent or Lenders written confidential information belonging to
Borrower, if Borrower shall denominate such information in writing as
"confidential", Administrative Agent and Lenders shall thereafter maintain such
information in confidence in accordance with the standards of care and diligence
that each utilizes in maintaining its own confidential information. This
obligation of confidence shall not apply to such portions of the information
which (i) are in the public domain, (ii) hereafter become part of the public
domain without Administrative Agent or Lenders breaching their obligation of
confidence to Borrower, (iii) are previously known by Administrative Agent or
Lenders from some source other than Borrower, (iv) are hereafter developed by
Administrative Agent or Lenders without using Borrower's information, (v) are
hereafter obtained by or available to Administrative Agent or Lenders from a
third party who owes no obligation of confidence to Borrower with respect to
such information or through any other means other than through disclosure by
Borrower, (vi) are disclosed with Borrower's consent, (vii) must be disclosed
either pursuant to any Governmental Requirement or to Persons regulating the
activities of Administrative Agent or Lenders, or (viii) as may be required by
law or regulation or order of any Governmental Authority in any judicial,
arbitration, or governmental proceeding. Further, Administrative Agent or a
Lender may disclose any such information to any other Lender, any independent
petroleum engineers or consultants, any independent certified public
accountants, any legal counsel employed by such Person in connection with this
Agreement or any Security Instrument, including
74
82
without limitation, the enforcement or exercise of all rights and remedies
thereunder, or any assignee or participant (including prospective assignees and
participants) in the Loans; PROVIDED, HOWEVER, THAT Administrative Agent or
Lenders shall receive a confidentiality agreement from the Person to whom such
information is disclosed such that said Person shall have the same obligation to
maintain the confidentiality of such information as is imposed upon
Administrative Agent or the Lenders hereunder. Notwithstanding anything to the
contrary provided herein, this obligation of confidence shall cease five years
from the date the information was furnished, unless Borrower requests in writing
at least 30 days prior to the expiration of such five year period, to maintain
the confidentiality of such information for an additional five year period.
Executed in Fort Worth, Texas, on the date first set forth above.
BORROWER:
RANGE RESOURCES CORPORATION
By:
----------------------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇,
Senior Vice President
AGENTS:
BANK ONE, TEXAS, N.A.,
as Administrative Agent and a Lender
By:
------------------------------------
W. ▇▇▇▇ ▇▇▇▇▇▇▇, Vice President
CHASE BANK OF TEXAS, N.A.,
as Syndication Agent and a Lender
By:________________________________
Name:
Title:
BANK OF AMERICA, N.A.,
as Documentation Agent and a Lender
By:______________________________
J. ▇▇▇▇▇ ▇▇▇▇▇▇, Managing Director
Amended and Restated Credit Agreement - Page 75
83
BANKERS TRUST COMPANY
By:______________________________
Name:____________________________
Title:
OTHER LENDERS:
PNC BANK, NATIONAL ASSOCIATION
By:_______________________________
Name:____________________________
Title:_____________________________
BANKBOSTON, N.A.
By:______________________________
Name:____________________________
Title:_____________________________
CIBC INC.
By:______________________________
Name:____________________________
Title:_____________________________
▇▇▇▇▇ FARGO BANK (TEXAS), N.A.
By:______________________________
Name:
Title:
CREDIT LYONNAIS NEW YORK BRANCH
By:______________________________
Name:____________________________
Title:_____________________________
76
84
ABN AMRO BANK N.V.
By:
Name:
Title:
By:
Name:
Title:
BANK OF SCOTLAND
By:______________________________
Name:____________________________
Title:_____________________________
THE SANWA BANK, LIMITED
By:______________________________
Name:____________________________
Title:_____________________________
Amended and Restated Credit Agreement - Page 77
85
SCHEDULE 1
COMMITMENTS
---------------------------------------------------- -------------------------- -----------------------------------
LENDER COMMITMENT COMMITMENT PERCENTAGE
---------------------------------------------------- -------------------------- -----------------------------------
Bank One, Texas, N.A. $25,312,500 11.25%
---------------------------------------------------- -------------------------- -----------------------------------
Bank of America, N.A. $25,312,500 11.25%
---------------------------------------------------- -------------------------- -----------------------------------
Chase Bank of Texas, N.A. $25,312,500 11.25%
---------------------------------------------------- -------------------------- -----------------------------------
Bankers Trust Company $20,812,500 9.25%
---------------------------------------------------- -------------------------- -----------------------------------
PNC Bank, National Association $19,687,500 8.75%
---------------------------------------------------- -------------------------- -----------------------------------
BankBoston, N.A. $19,687,500 8.75%
---------------------------------------------------- -------------------------- -----------------------------------
CIBC Inc. $19,687,500 8.75%
---------------------------------------------------- -------------------------- -----------------------------------
▇▇▇▇▇ Fargo Bank (Texas), N.A. $19,687,500 8.75%
---------------------------------------------------- -------------------------- -----------------------------------
Credit Lyonnais New York Branch $19,687,500 8.75%
---------------------------------------------------- -------------------------- -----------------------------------
ABN AMRO Bank N.V. $11,250,000 5.00%
---------------------------------------------------- -------------------------- -----------------------------------
Bank of Scotland $10,125,000 4.50%
---------------------------------------------------- -------------------------- -----------------------------------
The Sanwa Bank, Limited $ 8,437,500 3.75%
---------------------------------------------------- -------------------------- -----------------------------------
Total Commitment $225,000,000 100.00%
---------------------------------------------------- -------------------------- -----------------------------------
78
86
SCHEDULE 2
ADDRESSES FOR NOTICES
Range Resources Corporation Bank One, Texas, N.A.
▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ Attention: W. ▇▇▇▇ ▇▇▇▇▇▇▇
Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇ Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇
Fax No.: (▇▇▇) ▇▇▇-▇▇▇▇ Fax No.: (▇▇▇) ▇▇▇-▇▇▇▇
ABN AMRO Bank N.V. CIBC Inc.
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇ Two Paces West, ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇ or 5121 Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇
Fax No.: (▇▇▇) ▇▇▇-▇▇▇▇ Fax No.: (▇▇▇) ▇▇▇-▇▇▇▇
ABN AMRO Bank N.V. CIBC Inc.
c/o ABN AMRO North America, Inc. 1600 ▇▇▇▇▇, Suite ▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇ Attention: ▇▇▇▇▇▇▇ ▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇ Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇
Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇ Fax No.: (▇▇▇) ▇▇▇-▇▇▇▇
Fax No.: (▇▇▇) ▇▇▇-▇▇▇▇
BankBoston, ▇.▇. ▇▇▇▇▇ Bank of Texas, N.A.
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, Mail Stop 01-08-04 ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇▇▇▇▇ Attn: ▇▇▇▇ ▇. ▇▇▇▇
Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇ Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇
Fax No.: (▇▇▇) ▇▇▇-▇▇▇▇ Fax No.: (▇▇▇) ▇▇▇-▇▇▇▇
Bankers Trust Company Credit Lyonnais New York Branch
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ Attention: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇ Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇
Fax No.: (▇▇▇) ▇▇▇-▇▇▇▇ Fax No.: (▇▇▇) ▇▇▇-▇▇▇▇
Bankers Trust Company PNC Bank, National Association
▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇ ▇▇▇ ▇▇▇ ▇▇▇▇▇, ▇▇▇ Floor, ▇▇▇ ▇▇▇▇▇ ▇▇▇.
▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇ Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇
Fax No.: (▇▇▇) ▇▇▇-▇▇▇▇ Fax No.: (▇▇▇) ▇▇▇-▇▇▇▇
Bank of America, N.A. The Sanwa Bank, Limited
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇ ▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇ ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attn: J. ▇▇▇▇▇ ▇▇▇▇▇▇ Attention: ▇▇▇▇▇ ▇▇▇▇▇▇
Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇ Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇
Fax No.: (▇▇▇) ▇▇▇-▇▇▇▇ Fax No.: (▇▇▇) ▇▇▇-▇▇▇▇
Bank of Scotland The Sanwa Bank, Limited
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇ Attention: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Fax No.: (▇▇▇) ▇▇▇-▇▇▇▇ Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇
Fax No.: (▇▇▇) ▇▇▇-▇▇▇▇
Bank of Scotland ▇▇▇▇▇ Fargo Bank (Texas), N.A.
1750 Two ▇▇▇▇▇ Center ▇▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇ Attention: ▇▇▇▇▇ ▇▇▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇
Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇ Fax No. (▇▇▇) ▇▇▇-▇▇▇▇
Fax No.: (▇▇▇) ▇▇▇-▇▇▇▇
79
87
SCHEDULE 3
----------
LIST OF SUBSIDIARIES
1. DOMAIN ENERGY INTERNATIONAL CORPORATION,
a British Virgin Islands corporation,
!100% owned by Range Energy Ventures Corporation;
2. ENERGY ASSETS OPERATING COMPANY, a Delaware corporation,
!100% owned by Range Resources Corporation;
3. GULFSTAR ENERGY, INC., a Delaware corporation,
!100% owned by Range Energy Ventures Corporation;
4. GULFSTAR SEISMIC, INC., a Delaware corporation,
!100% owned by Gulfstar Energy, Inc.
5. RRC OPERATING COMPANY, an Ohio corporation,
!100% owned by Range Resources Corporation;
6. Range Energy I, Inc., a Delaware corporation,
!100% owned by Range Production Company;
7. RANGE ENERGY FINANCE CORPORATION, a Delaware corporation,
!100% owned by Range Energy Ventures Corporation;
8. RANGE ENERGY SERVICES COMPANY, a Delaware corporation,
!100% owned by Range Resources Corporation;
9. RANGE ENERGY VENTURES CORPORATION, a Delaware corporation,
!100% owned by Range Resources Corporation;
10. RANGE GAS COMPANY, a Delaware corporation,
!100% owned by Range Resources Corporation;
11. RANGE GATHERING & PROCESSING COMPANY, a Delaware corporation,
!100% owned by Range Resources Corporation;
12. RANGE HOLDCO, INC., a Delaware corporation,
!100% owned by Range Resources Corporation;
80
88
13. RANGE OFFSHORE, L.P., an Ohio limited partnership,
!owned by RRC Operating Company (1%) and Range HoldCo, Inc. (99%);
14. RANGE PIPELINE SYSTEMS, L.P., a Texas limited partnership,
!owned by Range Gathering & Processing Company (1%) and
Range Gas Company (99%);
15. RANGE PRODUCTION I, L.P., a Texas limited partnership,
!owned by Range Production Company (1%) and Range Energy I, Inc. (99%);
16. RANGE PRODUCTION COMPANY, a Delaware corporation,
!100% owned by Range Energy Ventures Corporation; and
17. RANGE RESOURCES, L.L.C., an Oklahoma limited liability company,
!owned by Range Production Company (1.71%) and
Range HoldCo, Inc. (98.29%).
81