EXHIBIT 4.2
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LETTER OF CREDIT FACILITY AGREEMENT
DATED AS OF SEPTEMBER 1, 1996
AMONG
NGC CORPORATION
AND
CANADIAN IMPERIAL BANK OF COMMERCE,
INDIVIDUALLY AND AS AGENT
AND
THE LENDERS NAMED HEREIN
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TABLE OF CONTENTS
PAGE
ARTICLE I DEFINITIONS .................................................................................. 1
1.1 Defined Terms ................................................................................ 1
1.2 Accounting Terms and Other Determinations .................................................... 18
ARTICLE II THE FACILITY ................................................................................. 19
2.1 The Loan Facility ............................................................................ 19
2.1.1 Description of Loan Facility ........................................................ 19
2.1.2 Availability of Facility ............................................................ 19
2.1.3 Advances ............................................................................ 19
2.1.4 Lender's Several Obligations ........................................................ 20
2.1.5 Types of Advances ................................................................... 20
2.2 The Letter of Credit Facility ................................................................ 20
2.2.1 Issuance of Letters of Credit ....................................................... 20
2.2.2 Aggregate Amount Available under Letters of Credit .................................. 20
2.2.3 Reimbursement of Lenders; Automatic Advances ........................................ 21
2.2.4 Lender's Several Obligations ........................................................ 21
2.2.5 Letter of Credit Fees ............................................................... 22
2.2.6 Modification of Outstanding Letters of Credit ....................................... 22
2.2.7 Verification ........................................................................ 22
2.2.8 Irrevocable Obligations and Commercial Practices ................................... 23
2.2.9 Letter of Credit Collateral Account ................................................. 24
2.3 Required Payments ............................................................................ 24
2.4 Fees ......................................................................................... 24
2.4.1 Commitment Fees ....................................................................... 24
2.4.2 Cancellation .......................................................................... 25
2.5 Minimum Amount of Each Eurodollar Advance .................................................... 25
2.6 Optional Principal Payments .................................................................. 25
2.7 Method of Selecting Types and Interest Periods for New Advances .............................. 25
2.8 Conversion and Continuation of Outstanding Advances .......................................... 26
2.9 Changes in Interest Rate, etc. ............................................................... 27
2.10 Rates Applicable After Default ............................................................... 27
2.11 Method of Payment ............................................................................ 27
2.12 Notes; Notices ............................................................................... 27
2.13 Interest Payment Dates; Interest and Fee Basis ............................................... 28
2.14 Notification of Advances, Interest Rates, Prepayments and
Commitment tions Reductions .................................................................. 28
2.15 Lending Installations .............................................................,.......... 28
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TABLE OF CONTENTS
(CONTINUED)
PAGE
2.16 Non-Receipt of Funds by the Agent ............................................................ 29
2.17 Withholding Tax Exemption .................................................................... 29
2.18 Maximum Interest Rate ........................................................................ 29
2.19 Agent's Fees ................................................................................. 30
2.20 Procedures for Extensions of the Facility Maturity Date ...................................... 30
2.21 Procedures with respect to Increases in the Aggregate Commitment ............................. 30
ARTICLE III CHANGE IN CIRCUMSTANCES ...................................................................... 33
3.1 Yield Protection ............................................................................. 33
3.2 Changes in Capital Adequacy Regulations ...................................................... 34
3.3 Availability of Types of Advances ............................................................ 35
3.4 Funding Indemnification ...................................................................... 35
3.5 Lender Statements; Survival of Indemnity ..................................................... 35
3.6 Replacement of Lenders ....................................................................... 36
ARTICLE IV CONDITIONS PRECEDENT ......................................................................... 37
4.1 Initial Advance and Letter of Credit ......................................................... 37
4.2 Each Advance ................................................................................. 38
ARTICLE V REPRESENTATIONS AND WARRANTIES ............................................................... 39
5.1 Corporate or Partnership Existence and Standing .............................................. 39
5.2 Authorization and Validity ................................................................... 39
5.3 No Conflict; Government Consent .............................................................. 39
5.4 Financial Statements ......................................................................... 40
5.5 Material Adverse Change ...................................................................... 40
5.6 Taxes ........................................................................................ 40
5.7 Litigation and Contingent Obligations ........................................................ 40
5.8 Subsidiaries ................................................................................. 40
5.9 ERISA ........................................................................................ 40
5.10 Accuracy of Information ...................................................................... 41
5.11 Regulation U ................................................................................. 41
5.12 Compliance With Laws ......................................................................... 41
5.13 Environmental Matters ........................................................................ 41
5.14 Ownership of Properties; Liens ............................................................... 42
5.15 Investment Company Act ....................................................................... 42
5.16 Public Utility Holding Company Act ........................................................... 42
5.17 Insurance .................................................................................... 43
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TABLE OF CONTENTS
(CONTINUED)
PAGE
5.18 Solvency ..................................................................................... 43
5.19 Default ...................................................................................... 43
ARTICLE VI COVENANTS .................................................................................... 43
6.1 Affirmative Covenants ........................................................................ 44
6.1.1 Financial Reporting ................................................................... 44
6.1.2 Use of Proceeds ....................................................................... 45
6.1.3 Additional Subsidiary Guaranties ...................................................... 45
6.1.4 Conduct of Business ................................................................... 46
6.1.5 Taxes and Other Charges ............................................................... 46
6.1.6 Insurance ............................................................................. 46
6.1.7 Compliance with Laws .................................................................. 47
6.1.8 Maintenance of Properties ............................................................. 47
6.1.9 Inspection ............................................................................ 47
6.1.10 Maintenance of Books and Records ..................................................... 47
6.1.11 Compliance with ERISA ................................................................ 47
6.1.12 Maintenance of Credit Rating ......................................................... 48
6.2 Negative Covenants ........................................................................... 48
6.2.1 [Intentionally Omitted] .............................................................. 48
6.2.2 Debt ................................................................................. 48
6.2.3 Merger ............................................................................... 49
6.2.4 Sale of Assets ....................................................................... 49
6.2.5 Sale of Accounts ..................................................................... 50
6.2.6 Investments and Acquisitions ......................................................... 50
6.2.7 Contingent Obligations ............................................................... 52
6.2.8 Liens ................................................................................ 53
6.2.9 [Intentionally Deleted] .............................................................. 54
6.2.10 Affiliates ........................................................................... 54
6.2.11 Judgments ............................................................................ 54
6.3 Financial Covenants .......................................................................... 54
6.3.1 Net Worth ............................................................................ 54
6.3.2 Leverage Ratio ....................................................................... 54
ARTICLE VII DEFAULTS ..................................................................................... 55
ARTICLE VIII ACCELERATION, WAIVERS, AMENDMENTS AND REMEDIES ............................................... 57
8.1 Acceleration ................................................................................. 57
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TABLE OF CONTENTS
(CONTINUED)
PAGE
8.2 Amendments ................................................................................... 59
8.3 Preservation of Rights ....................................................................... 60
ARTICLE IX GENERAL PROVISIONS ........................................................................... 60
9.1 Survival of Representations; Obligations ..................................................... 60
9.2 Governmental Regulation ...................................................................... 60
9.3 Taxes ........................................................................................ 60
9.4 Headings ..................................................................................... 60
9.5 Entire Agreement ............................................................................. 61
9.6 Several Obligations; Benefits of this Agreement .............................................. 61
9.7 Expenses; Indemnification of Agent and Lenders ............................................... 61
9.8 Numbers of Documents ......................................................................... 62
9.9 Severability of Provisions ................................................................... 62
9.10 Nonliability of Lenders ...................................................................... 62
9.11 CHOICE OF LAW ................................................................................ 62
9.12 CONSENT TO JURISDICTION ...................................................................... 62
9.13 WAIVER OF JURY TRIAL ......................................................................... 62
9.14 Confidential Information ..................................................................... 63
ARTICLE X THE AGENT .................................................................................... 64
10.1 Appointment and Authority of Agent ........................................................... 64
10.2 Capacity of the Agent ........................................................................ 65
10.3 No Liability of the Agent and Indemnity ...................................................... 65
10.4 Employees of Agent ........................................................................... 65
10.5 Reliance ..................................................................................... 66
10.6 Several Commitments .......................................................................... 66
10.7 Notice of Default ............................................................................ 67
10.8 Lender Credit Decision ....................................................................... 67
10.9 Successor Agent .............................................................................. 67
ARTICLE XI SETOFF; RATABLE PAYMENTS ..................................................................... 68
11.1 Setoff ....................................................................................... 68
11.2 Ratable Payments ............................................................................. 68
ARTICLE XII BENEFIT OF AGREEMENT; ASSIGNMENTS; PARTICIPATIONS ............................................ 68
12.1 Successors and Assigns ....................................................................... 68
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TABLE OF CONTENTS
(CONTINUED)
PAGE
12.2 Participations ............................................................................... 69
12.2.1 Permitted Participants; Effect ....................................................... 69
12.2.2 Voting Rights ........................................................................ 69
12.2.3 Benefit of Setoff .................................................................... 69
12.3 Assignments .................................................................................. 70
12.3.1 Permitted Assignments ................................................................ 70
12.3.2 Effect; Effective Date ............................................................... 70
12.4 Dissemination of Information ................................................................. 71
12.5 Tax Treatment ................................................................................ 71
ARTICLE XIII NOTICES ...................................................................................... 71
13.1 Giving Notice ................................................................................ 71
13.2 Change of Address ............................................................................ 72
ARTICLE XIV COUNTERPARTS ................................................................................. 72
V
SCHEDULES
EXHIBIT "A-1" FORM OF NOTE
EXHIBIT "B-1" FORM OF LETTER OF CREDIT
EXHIBIT "B-2" FORM OF LETTER OF CREDIT MODIFICATION
EXHIBIT "C" FORM OF OPINION OF BORROWER'S COUNSEL
EXHIBIT "D" COMPLIANCE CERTIFICATE
EXHIBIT "E-1" ISSUANCE REQUEST
EXHIBIT "E-2" L/C MODIFICATION NOTICE
EXHIBIT "F" ASSIGNMENT AGREEMENT
EXHIBIT "G" NOTICE OF COMMITMENT INCREASE
EXHIBIT "H-1" FORM OF GUARANTY
EXHIBIT "H-2" FORM OF TRIDENT GUARANTY
SCHEDULE "1" SUBSIDIARIES AND OTHER INVESTMENTS
SCHEDULE "2" DEBT AND LIENS
SCHEDULE "3" LITIGATION
SCHEDULE "4" TRIDENT EXISTING GUARANTIES
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LETTER OF CREDIT FACILITY AGREEMENT
This Letter of Credit Facility Agreement, dated as of September 1, 1996, is
among NGC Corporation, a Delaware corporation, as borrower, the Lenders
(hereinafter defined), and Canadian Imperial Bank of Commerce, a Delaware
corporation, as agent. The parties hereto agree as follows:
ACTICLE I
DEFINITIONS
1.1 Defined Terms.
As used in this Agreement:
"Acquisition" means any transaction, or any series of related transactions,
consummated on or after the date of this Agreement, by which the Borrower or any
of its Subsidiaries (i) acquires any going business or all or substantially all
of the assets of any firm, corporation or division thereof, whether through
purchase of assets, merger or otherwise or (ii) directly or indirectly acquires
(in one transaction or as the most recent transaction in a series of
transactions) at least a majority (in number of votes) of the securities of a
corporation which have ordinary voting power for the election of directors
(other than securities having such power only by reason of the happening of a
contingency) or a majority (by percentage or voting power) of the outstanding
partnership interests of a partnership.
"Additional Guaranty" is defined in Section 6.1.3.
"Advance" means a borrowing hereunder consisting of the aggregate amount of
the several Loans made by some or all of the Lenders concurrently to the
Borrower pursuant hereto on the same Borrowing Date, at the same Rate Option
and, in the case of a Eurodollar Advance, for the same Eurodollar Interest
Period.
"Affiliate" of any Person means any other Person directly or indirectly
controlling, controlled by or under common control with such Person. A Person
shall be deemed to control another Person if the controlling Person owns 10% or
more of any class of voting securities (or other ownership interests) of the
controlled Person or possesses, directly or indirectly, the power to direct or
cause the direction of the management or policies of the controlled Person,
whether through ownership of stock, by contract or otherwise.
"Agent" means Canadian Imperial Bank of Commerce in its capacity as agent
for the Lenders pursuant to Article X, and not in its individual capacity as a
Lender, and any successor Agent appointed pursuant to Article X.
"Aggregate Commitment" means $300,000,000 as increased or reduced from time
to time pursuant to the terms hereof.
"Agreement" means this Letter of Credit Facility Agreement, as it may be
amended or modified and in effect from time to time.
"Agreement Accounting Principles" means generally accepted accounting
principles as in effect from time to time, applied on a basis consistent with
the most recent financial statements of the Borrower and its Subsidiaries
delivered to the Lenders pursuant hereto.
"Alternate Base Rate" means, for any day, a rate of interest per annum
equal to the higher of (i) the Base Rate for such day and (ii) the sum of
Federal Funds Effective Rate for such day plus 1/2% per annum.
"Applicable Commitment Fee" means on any date (subject to clause (iv) of
the "Applicable Rating Level") the number of basis points per annum set forth on
the table below under the Applicable Rating Level on such date.
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APPLICABLE
RATING
▇▇▇▇▇ ▇▇▇▇▇ ▇ ▇▇▇▇▇ ▇▇ ▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇ ▇▇ LEVEL V
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BASIS POINTS 5.0 6.0 8.5 10.0 17.5
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"Applicable Margin" means on any date and with respect to each Eurodollar
Advance (subject to clause (iv) of the definition of "Applicable Rating Level")
the number of basis points per annum set forth on the table below under the
Applicable Rating Level on such date.
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APPLICABLE
RATING
▇▇▇▇▇ ▇▇▇▇▇ ▇ ▇▇▇▇▇ ▇▇ ▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇ ▇▇ LEVEL V
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BASIS POINTS 25.0 30.0 35.0 37.5 55.0
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"Applicable Rating Level" means (except as set forth below) the highest
level set forth below that corresponds to a rating issued from time to time by
S&P or ▇▇▇▇▇'▇ as applicable to the Borrower's senior unsecured long-term debt:
2
-------------------------------
▇▇▇▇▇'▇ S&P
-------------------------------
LEVEL I =)A3 =)A-
-------------------------------
LEVEL II (A3 & (A- &
=)BAA1 =)BBB+
-------------------------------
LEVEL III (BAA1 & (BBB+ &
=)BAA2 =)BBB
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LEVEL IV (BAA2 & (BBB &
=)BAA3 =)BBB-
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LEVEL V (BAA3 (BBB-
-------------------------------
For example, if the ▇▇▇▇▇'▇ rating is Baa1 and the S&P rating is BBB, Level II
shall apply.
For purposes of the foregoing, (i) "=)" means a rating equal to or more
favorable than; "(" means a rating less favorable than; (ii) if neither of the
Rating Agencies have issued ratings for the Borrower's senior unsecured long-
term debt, Level V shall be deemed applicable; (iii) if both Rating Agencies
have issued ratings for the Borrower's senior unsecured long-term debt and such
ratings are more than one level apart (for example, the ▇▇▇▇▇'▇ rating is Baa1
and the S&P rating is BBB-), the level immediately below the highest level set
forth above shall be deemed applicable (for example, if the ▇▇▇▇▇'▇ rating is
Baa1 and the S&P rating is BBB-, Level III shall apply); (iv) if determinative
ratings shall change (other than as a result of a change in the rating system
used by any applicable Rating Agency) such that a change in Applicable Rating
Level would result, such change shall effect a change in Applicable Rating Level
as of the day on which it is first announced by the applicable Rating Agency,
and any change in the Applicable Margin or the Applicable Commitment Fee shall
apply commencing on the effective date of such change and ending on the date
immediately preceding the effective date of the next such change; and (v) if the
rating system of any of the Rating Agencies shall change prior to the date all
obligations hereunder have been paid and the Commitments cancelled, the Borrower
and the Lenders shall negotiate in good faith to amend the references to
specific ratings in this definition to reflect such changed rating system, and
pending such amendment, if no Applicable Rating Level is otherwise determinable
based upon the foregoing, the last Applicable Rating Level shall apply.
"Article" means an article of this Agreement unless another document is
specifically referenced.
3
"Authorized Officer" means any of the President, the Chief Financial
Officer, the General Counsel, the Controller or the Treasurer of the Borrower.
"Authorized Representative" means any Authorized Officer or the Assistant
Treasurer of the Borrower.
"Base Rate" means, on any date, a fluctuating rate of interest per annum
equal to the rate of interest most recently established by the Agent at its
office in New York, New York as its base rate for Dollar loans in the United
States. The Base Rate is not necessarily intended to be the lowest rate of
interest determined by the Agent in connection with extensions of credit.
Changes in the rate of interest on any Obligation determined by reference to the
Base Rate will take effect simultaneously with each change in the Base Rate.
"Base Rate Advance" means an Advance which bears interest at the Alternate
Base Rate.
"Base Rate Loan" means a Loan which bears interest at the Alternate Base
Rate.
"Borrower" means NGC Corporation, a Delaware corporation, and its
successors and assigns.
"Borrowing Date" means a date on which an Advance is made hereunder.
"Borrowing Notice" is defined in Section 2.7.
"British Gas" means British Gas plc, a corporation incorporated under the
laws of England and Wales, and its successors and assigns, including the
successors that would result from the currently proposed restructuring.
"Business Day" means (i) with respect to any borrowing or payment of a
Eurodollar Advance, a day (other than a Saturday or Sunday) on which banks
generally are open in Chicago and New York for the conduct of substantially all
of their commercial lending activities and on which dealings in United States
dollars are carried on in the London interbank market and (ii) for all other
purposes, a day (other than a Saturday or Sunday) on which banks generally are
open in Chicago and New York City for the conduct of substantially all of their
commercial lending activities.
"Capitalized Lease" of a Person means any lease of Property by such Person
as lessee which would be capitalized on a balance sheet of such Person prepared
in accordance with Agreement Accounting Principles.
4
"Capitalized Lease Obligations" of a Person means the amount of the
obligations of such Person as a lessee under Capitalized Leases which would be
shown as a liability on a balance sheet of such Person prepared in accordance
with Agreement Accounting Principles.
"Change" is defined in Section 3.2.
"Change in Control" means NOVA Corporation, British Gas, Chevron
Corporation, and/or the shareholders of the PEP Partners (as defined in the
Trident MergerAgreement) including ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Inc. shall cease to own,
directly or indirectly either (i) at least 50% in the aggregate of the
outstanding shares of voting stock of the Borrower without giving effect to any
equity issues by the Borrower after the Closing Date (but after giving effect to
any equity issued by the Borrower to any one or more of NOVA Corporation,
British Gas, Chevron Corporation, the shareholders of the PEP Partners, and
their successors, including ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Inc., or their respective
Subsidiaries) or (ii) at least 40% in the aggregate of the outstanding shares of
voting stock of the Borrower.
"CIBC" means Canadian Imperial Bank of Commerce in its individual capacity,
and its successors.
"Closing Date" means September 1, 1996.
"Code" means the Internal Revenue Code of 1986, as amended, reformed or
otherwise modified from time to time.
"Collateral Shortfall Amount" is defined in Section 8.1(a).
"Commitment" means, for each Lender, the obligation of such Lender to issue
Letters of Credit hereunder or make Loans hereunder not exceeding the amount set
forth opposite its signature below or as set forth in any Notice of Assignment
relating to any assignment that has become effective pursuant to Section 12.3.2,
as such amount may be modified from time to time pursuant to the terms hereof.
"Commitment Increase Effective Date" is defined in Section 2.21.
"Commitment Termination Date" means the earlier to occur of (i) the
Facility Maturity Date, (ii) the date on which all of the Commitments are
terminated in full or the Commitments are reduced to zero pursuant to Section
2.4.2, and (iii) the earlier of the date of either (a) the occurrence of any
Default described in Section 8.1(a) or (b) the occurrence and continuance of any
other Default and either (1) the declaration of the Loans to be due and payable
pursuant to
5
Section 8.1(b) or (2) in the absence of such declaration, the giving of notice
by the Agent to the Borrower that the Commitments have been terminated pursuant
to Section 8.1(b).
"Compliance Certificate" is defined in Section 6.1.1(iii).
"Consolidated Debt" means, as of any date of determination thereof, the
aggregate principal amount of all then outstanding Debt of the Borrower and its
Subsidiaries, determined on a consolidated basis in accordance with Agreement
Accounting Principles as of such date.
"Consolidated EBITD" shall mean, for any period, the sum of (a)
Consolidated Net Income (excluding income taxes) determined for such period;
provided that shall be excluded (i) the income (or loss) of any Person (other
than a Subsidiary of the Borrower) in which the Borrower or any Subsidiary of
the Borrower has an interest but in which any other Person (not the Borrower or
any of its Subsidiaries) has a joint interest with respect to which the equity
method of accounting is utilized, except to the extent of the amount of
dividends or other distributions actually paid to the Borrower, or any of its
Subsidiaries by such Person during such period, (ii) the income (or loss) of any
Person accrued prior to the date it becomes a Subsidiary of the Borrower or is
merged into or consolidated with the Borrower or any of its Subsidiaries or that
Person's Properties are acquired by the Borrower or any of its Subsidiaries, and
(iii) the income of any Subsidiary of the Borrower to the extent that the
declaration or payment of dividends or similar distributions by that Subsidiary
of that income is not at the time permitted by operation of the terms of its
charter or any agreement (other than the Existing Trident Indentures as in
effect on November 1, 1994), instrument, judgment, decree, order, statute, rule
or governmental regulation applicable to that Subsidiary, plus (b) the Interest
Expense for such period, plus (c) to the extent taken into account in
calculating Consolidated Net Income (excluding income taxes) referred to in
clause (a) of this definition, the aggregate amount of all costs and expenses
incurred as a result of the Trident Merger and of the Midstream Merger,
respectively, including, without limitation, all prepayment premiums payable on
Debt required to be prepaid as a result of the occurrence of the Trident Merger,
plus (d) depreciation, depletion and amortization expense of the Borrower and
its Subsidiaries determined for such period on a consolidated basis, plus (e)
without duplication, the amount of dividends or other distributions actually
paid to the Borrower or any of its Subsidiaries during such period to the extent
attributable to income from another period excluded pursuant to clause (i)
above; provided, however, for purposes of this definition, extraordinary gains
and losses shall be excluded from the calculation of Consolidated Net Income.
"Consolidated Interest Expense" means, for any Rolling Period, the total
interest expense, whether paid or accrued (including, without limitation, that
attributable to Capitalized Leases), of the Borrower and its Subsidiaries
determined for such period on a consolidated basis in accordance with Agreement
Accounting Principles, including, without limitation, all
6
commissions, discounts and other fees and charges owed with respect to letters
of credit and bankers' acceptance financing plus or minus net amounts paid or
payable or received or receivable pursuant to interest rate swap, exchange, cap
or similar agreements.
"Consolidated Net Income" means, for any period, the consolidated net
income of a Person and its Subsidiaries for such period as determined on a
consolidated basis in accordance with Agreement Accounting Principles.
"Consolidated Net Worth" means at any date the stockholders' equity of the
Borrower and its Subsidiaries determined on a consolidated basis in accordance
with Agreement Accounting Principles as of such date.
"Consolidated Tangible Net Worth" means at any date the stockholders'
equity of the Borrower and its Subsidiaries less their consolidated Intangible
Assets, all determined on a consolidated basis in accordance with Agreement
Accounting Principles as of such date. For purposes of this definition
"Intangible Assets" means the amount (to the extent reflected in determining
such stockholders' equity) of (a) all net write-ups (other than write-ups
resulting from foreign currency translations and write-ups of assets of a going
concern business made within twelve months after the acquisition of such
business) subsequent to December 31, 1993 in the book value of any Property
owned by the Borrower or any of its consolidated Subsidiaries and (b) all
unamortized debt discount and expense, goodwill, patents, trademarks, service
marks, trade names, copyrights, and organization or developmental expenses.
"Controlled Group" means all members of a controlled group of corporations
and all trades or businesses (whether or not incorporated) under common control
which, together with the Borrower, are treated as a single employer under
Section 414 of the Code.
"Conversion/Continuation Notice" is defined in Section 2.8.
"CUSA" means Chevron U.S.A. Inc.
"CUSA Assumed Debt" means the $155,373,000 aggregate principal amount of
CUSA's obligations under the CUSA Note, the payment of which was assumed by
Midstream under the CUSA Assumption Agreement.
"CUSA Assumption Agreement" means the agreement dated as of the closing of
the for the CUSA Assumed Debt.
7
"CUSA Certificate" means a certificate in the form of Annex B to the
Letters of Credit delivered by CUSA to effect a reduction in the Stated Amount
or Stated Maturity Date of, or a change in the Percentage attributable to, any
outstanding Letters of Credit.
"CUSA Note" means the demand promissory note dated August 25, 1994 payable
by CUSA to Chevron Capital U.S.A. Inc.
"Debt" means, with respect to any Person, (a) all indebtedness and other
obligations of such Person for the repayment of money borrowed, whether or not
represented by acceptances, bonds, debentures, notes, or other instruments or
securities, (b) all indebtedness and other obligations of such Person for the
deferred payment of the purchase price of any property or assets (other than
accounts payable on terms customary in the trade), (c) all Capitalized Lease
Obligations of such Person, and (d) all indebtedness and other obligations,
whether or not assumed by such Person, secured by any Lien (other than a Lien
permitted pursuant to Section 6.2.8 (other than clauses (iv), (vi) and (vii)
thereof)) on, or payable out of the proceeds of or production from, any Property
of such Person; provided, however, that in no event shall Debt described in any
of the foregoing categories (i) be duplicative of any Debt described in any
other such category, (ii) include Guaranties or (iii) include any Project
Financing that would not be shown as a liability on the financial statements of
the Borrower and its Subsidiaries on a consolidated basis.
"Default" means an event described in Article VII.
"Draw Date" is defined in Section 2.2.3.
"Environmental Laws" means all applicable federal, state or local statutes,
laws, ordinances, codes, rules and regulations (including consent decrees and
administrative orders directed to the Borrower or any of its Subsidiaries)
relating to the protection of the environment and in effect in any and all
jurisdictions in which the Borrower or its Subsidiaries are conducting or at any
time have conducted business, or where any Property of the Borrower or any of
its Subsidiaries is located, or where any Hazardous Material generated by or
disposed of by the Borrower or any of its Subsidiaries is located, to the extent
applicable to each such business activity, Property or generation or disposal.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended from time to time, and any rule or regulation issued thereunder.
"Eurodollar Advance" means an Advance which bears interest at a Eurodollar
Rate requested by the Borrower pursuant to Section 2.1.
8
"Eurodollar Base Rate" means, with respect to any Eurodollar Interest
Period for any Eurodollar Loan, the lesser of (A) the rate per annum equal to
the average of the offered quotations appearing on Telerate Page 3750 (or if
such Telerate Page shall not be available, any successor or similar service as
may be selected by the Agent and the Borrower) as of 11:00 a.m., London time,
(or as soon thereafter as practicable) on the day two Business Days prior to the
first day of such Eurodollar Interest Period for dollar deposits having a term
comparable to such Eurodollar Interest Period or (B) the maximum interest rate
permitted pursuant to Section 2.18. If none of such Telerate Page 3750 nor any
successor or similar service is available, then the "Eurodollar Base Rate" shall
mean, with respect to any Eurodollar Interest Period for any applicable
Eurodollar Loan, the lesser of (A) the rate per annum determined by the Agent to
be the average of the rates quoted by the Reference Banks at approximately 11:00
a.m., London time, (or as soon thereafter as practicable) on the day two
Business Days prior to the first day of such Eurodollar Interest Period for the
offering by such Reference Banks to leading banks in the interbank market of
U.S. dollar deposits having a term comparable to such Eurodollar Interest Period
and in an amount comparable to the principal amount of the Eurodollar Loan of
such respective Reference Bank to which such Eurodollar Interest Period relates
or (B) the maximum interest rate permitted pursuant to Section 2.18. If any
Reference Bank does not furnish a timely quotation, the Agent shall determine
the relevant interest rate on the basis of the quotation or quotations furnished
by the remaining Reference Bank or Banks. Each determination of the Eurodollar
Base Rate shall be conclusive and binding, absent manifest error.
"Eurodollar Interest Period" means, with respect to a Eurodollar Advance, a
Eurodollar Loan, a period of one, two, three, six, or (subject to availability
by each applicable Lender) nine or twelve months commencing on a Business Day
selected by the Borrower pursuant to this Agreement. Such Eurodollar Interest
Period shall end on (but exclude) the day which corresponds numerically to such
date one, two, three, six, nine or twelve months thereafter, provided, however,
that if there is no such numerically corresponding day in such next, second,
third, sixth, ninth or twelfth succeeding month, such Eurodollar Interest Period
shall end on the last Business Day of such next, second, third, sixth, ninth or
twelfth succeeding month. If a Eurodollar Interest Period would otherwise end
on a day which is not a Business Day, such Eurodollar Interest Period shall end
on the next succeeding Business Day, provided, however, that if said next
succeeding Business Day falls in a new month, such Eurodollar Interest Period
shall end on the immediately preceding Business Day.
"Eurodollar Loan" means a Loan which bears interest at a Eurodollar Rate.
"Eurodollar Rate" means, with respect to a Eurodollar Advance or a
Eurodollar Loan for the relevant Eurodollar Interest Period, the sum of (i) the
quotient of (a) the Eurodollar Base Rate applicable to such Eurodollar Interest
Period, divided by (b) one minus the Reserve Requirement, if any, (expressed as
a decimal) applicable to such Eurodollar Interest Period plus
9
(ii) the Applicable Margin. The Eurodollar Rate shall be rounded, if necessary,
to the next higher 1/16 of 1%.
"Existing Bank Credit Facility" means the credit facility made available to
the Borrower and its Subsidiaries pursuant to the terms of that certain Credit
Agreement dated as of March 14, 1995 as amended by amendments dated as of
October 4, 1995 and July 26, 1996 and any subsequent amendment, extension or
replacement thereof.
"Existing Trident Indentures" means each of (i) the Indenture dated to be
effective as of September 9, 1993 between Trident NGL, Inc., Issuer, and
Ameritrust Texas National Association, Trustee, for $65,000,000 14% Senior
Subordinated Notes due 2001 and (ii) the Indenture dated to be effective as of
April 15, 1993 between Trident NGL, Inc., Issuer, and the First National Bank of
Boston, Trustee, for $105,000,000 10 1/4% Subordinated Notes due 2003.
"Existing Trident Subordinated Debt" means Debt of Trident under the
Existing Trident Indentures as amended to the date hereof, and hereafter as
amended consistent with Trident's Subsidiary Guaranty.
"Facility Maturity Date" means August 28, 1997, as may be extended from
time to time pursuant to Section 2.20.
"Federal Funds Effective Rate" means, for any day, an interest rate per
annum equal to the weighted average of the rates on overnight Federal funds
transactions with members of the Federal Reserve System arranged by Federal
funds brokers on such day, as published for such day (or, if such day is not a
Business Day, for the immediately preceding Business Day) by the Federal Reserve
Bank of New York, or, if such rate is not so published for any day which is a
Business Day, the average of the quotations at approximately [10:00] a.m. (New
York time) on such day on such transactions received by the Agent from three
Federal funds brokers of recognized standing selected by the Agent in its sole
discretion.
"Fixed Price Contract" means, as of any date of determination, a contract
(including, without limitation, physical delivery, option (whether cash or
financial), exchange, swap and futures contracts) entered into by the Borrower
or any Subsidiary of the Borrower for the purchase or sale of Natural Gas, other
than (i) such a contract which has a remaining term of thirty (30) days or less
from such date of determination, or (ii) such a contract under which the
purchase or sale price of any portion of Natural Gas delivered or to be
delivered on or after such date of determination is calculated by reference to
(a) the spot price for Natural Gas current on each date of delivery at the place
of delivery specified in such contract, (b) the spot price for Natural Gas
current on each date of delivery at a place of delivery other than the place of
delivery specified in such contract provided that such spot price is adjusted to
reflect the cost of
10
transporting Natural Gas to the place of delivery specified in such contract,
(c) a basket of price indices similar to the spot price for Natural Gas current
on each date of delivery at the place of delivery, or (d) a basket of price
indices similar to the then current spot price for Natural Gas at a place of
delivery other than the place of delivery specified in such contract provided
that each such price index is adjusted to reflect the cost of transporting
Natural Gas to the place of delivery specified in such contract; provided,
however, that no Processing Supply Contract shall be considered a Fixed Price
Contract for purposes of this Agreement.
"Gas Purchase Agreement" means the Natural Gas Purchase and Sale Agreement
dated August 31, 1996 among NGC and CUSA wherein NGC and CUSA agree to the
purchase and sale of Natural Gas pursuant to the terms set forth therein.
"Guarantor" means each of NGC and Trident and any other Subsidiary (direct
or indirect) from time to time of the Borrower that delivers a Subsidiary
Guaranty pursuant to Section 6.1.3 and each of their respective successors and
assigns.
"Guaranty" means, with respect to any Person, (a) all indebtedness and
other obligations, contingent or otherwise, of such Person under or in respect
of any letter of credit issued for its own account, and (b) all indebtedness and
other obligations of such Person under any agreement, undertaking or other
arrangement by which such Person (i) assumes, guarantees, endorses (other than
the endorsement of instruments for collection in the ordinary course of
business), commits or agrees (whether or not such commitment or agreement is
contingent or subject to the occurrence of a specified event or events) to
purchase or otherwise acquire or provide funds for the payment of any obligation
or liability of any other Person or (ii) agrees to maintain the net worth,
working capital or any other financial condition of any other Person; provided,
however, in no event shall Guaranties described in any of the foregoing
categories include any Guaranties by a Project Financing Subsidiary that would
not be shown as a liability on the financial statements of the Borrower and its
Subsidiaries on a consolidated basis.
"Hazardous Material" means (a) any "hazardous substance," as defined by the
Comprehensive Environmental Response, Compensation and Liability Act of 1980, as
amended, and (b) any "hazardous waste," as defined by the Resource Conservation
and Recovery Act, as amended and (c) any pollutant or contaminant or hazardous,
dangerous or toxic chemical, material waste or substance within the meaning of
any applicable Environmental Law, all as amended or hereafter amended.
"Increasing Lender" is defined in Section 2.21.
"Indemnified Party" is defined in Section 9.7.
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"Investment" of a Person means any loan, advance (other than commission,
relocation, travel and similar loans and/or advances to officers and employees
made in the ordinary course of business), extension of credit (other than
Guaranties, accounts receivable arising in the ordinary course of business on
terms customary in the trade and prepayments made and production payments
acquired in the ordinary course of business), or contribution of capital by such
Person to any other Person or any investment in, or purchase or other
acquisition of, the stock, partnership interests, notes, debentures or other
securities of any other Person made by such Person.
"Issuance Date" means, for each Letter of Credit, the date on which such
Letter of Credit is issued hereunder.
"Issuance Request" means a credit issuance request in substantially the
form attached to this Agreement as Exhibit "E-1" hereto, with all blanks
appropriately completed and duly executed and delivered by an Authorized
Representative on behalf of the Borrower.
"Laws" means all statutes, laws, ordinances, regulations, orders, writs,
injunctions, or decrees of the United States, any state, any foreign country, or
any other Tribunal.
"L/C Modification Notice" means a letter of credit amendment request in
substantially the form attached to this Agreement as Exhibit "E-2" hereto, with
all blanks appropriately completed and duly executed and delivered by an
Authorized Representative on behalf of the Borrower.
"Lenders" means the lending institutions listed on the signature pages of
this Agreement and the lending institutions that hereafter become parties hereto
pursuant to Section 12.3.
"Lending Installation" means, with respect to a Lender, any office, branch,
subsidiary or affiliate of such Lender.
"Letter of Credit" means a letter of credit or similar instrument which is
issued in favor of CUSA pursuant to this Agreement in substantially the form of
Exhibit "B-1" hereto.
"Letter of Credit Collateral Account" has the meaning in Section 2.2.9.
"Letter of Credit Liabilities" means, at any time, with respect to Letters
of Credit then in effect, the sum of (i) the undrawn face amount of such Letters
of Credit, plus (ii) the aggregate unpaid amount, if any, of all Obligations of
the Borrower then due and payable to reimburse the Lenders in respect of
drawings under such Letters of Credit.
12
"Leverage Ratio" means the ratio, expressed as a percentage, of
Consolidated Debt to the sum of Consolidated Debt plus Consolidated Net Worth.
"Lien" means any lien (statutory or other), mortgage, pledge,
hypothecation, assignment, security interest, encumbrance or preference,
priority or other security agreement or any interest in Property to secure
payment of a debt or performance of an obligation (including, without
limitation, the interest of a vendor or lessor under any conditional sale,
Capitalized Lease or other title retention agreement).
"Loan" means, with respect to a Lender, such Lender's portion of any
Advance.
"Loan Documents" means this Agreement, each of the Notes, each Letter of
Credit, each of the Subsidiary Guaranties, each Issuance Request, each Borrowing
Notice, the agreement with respect to fees referred to in Section 2.19, together
in each case with all exhibits, schedules and attachments thereto, and all other
agreements, documents, certificates and instruments from time to time executed
and delivered by the Borrower or any of its Subsidiaries pursuant to or in
connection with any of the foregoing.
"Loan Facility" is defined in Section 2.1.
"Material Adverse Effect" means a material adverse effect on (i) the
business, Property, financial condition or results of operations of the Borrower
and its Subsidiaries taken as a whole, or (ii) the ability of the Borrower to
perform its payment obligations under any of the Loan Documents.
"Material Agreement" means any contract or agreement to which the Borrower
or any of its Subsidiaries is a party which is material to the consolidated
financial condition or operations of the Borrower and its Subsidiaries, and
includes, without limitation, the Existing Trident Indentures.
"Midstream" means Midstream Combination Corp. or its successor under the
Midstream Merger Agreement.
"Midstream Merger" means the merger of Midstream and Old NGC with Midstream
being the surviving corporation and changing its name to NGC Corporation
pursuant to the Midstream Merger Agreement.
"Midstream Merger Agreement" means the Combination Agreement and Plan of
Merger dated May 22, 1996 among Old NGC, CUSA and Midstream.
13
"Moody's" means ▇▇▇▇▇'▇ Investors Service, Inc. and any successor thereto
that is a nationally-recognized rating agency.
"Multiemployer Plan" means a "multiemployer plan" within the meaning of
Section 4001(a)(3) of ERISA to which the Borrower or any member of the
Controlled Group is obligated to make contributions.
"Natural Gas" means all gaseous hydrocarbons including, but not limited to
oil well gas, gas well gas, and casinghead gas but excluding any natural gas
liquids.
"New Funds Amount" means the amount by which a New Lender's or an
Increasing Lender's outstanding Loans increase as of a Commitment Increase
Effective Date (without regard to any such increase as a result of Advances made
on such Commitment Increase Effective Date).
"New Lender" is defined in Section 2.21.
"NGC" means Natural Gas Clearinghouse, a general partnership organized
under the laws of the state of Colorado.
"Notes" means, collectively, the promissory notes in substantially the form
of Exhibit "A-1" hereto, with appropriate insertions, duly executed and
delivered to the Agent by the Borrower for the account of each Lender and
payable to the order of such Lender in the amount of its Commitment, including
any amendment, modification, renewal or replacement of such promissory notes;
and "Note" means any one of the Notes.
"Notice of Assignment" is defined in Section 12.3.2.
"Notice of Commitment Increase" is defined in Section 2.21.
"Obligations" means all unpaid principal of and accrued and unpaid interest
on the Notes, all accrued and unpaid fees and all expenses, reimbursements,
indemnities and other obligations of the Borrower to the Lenders or to any
Lender, the Agent or any Indemnified Party arising under any of the Loan
Documents.
"Obligors" means the Borrower and each Guarantor, and their successors and
assigns.
"Old NGC" means NGC Corporation, a Delaware corporation, prior to its
merger with Midstream pursuant to the Midstream Merger Agreement.
14
"Out of Funds Period" means the period from and including a Draw Date to
but excluding the date a Lender provides the Agent immediately available and
freely transferable funds equal to such Lender's Percentage of the drawing under
a Letter of Credit which took place on such Draw Date.
"Partially Increasing Lender" is defined in Section 2.21.
"Participants" is defined in Section 12.2.1.
"Payment Date" means the last Business Day of each calendar quarter.
"PBGC" means the Pension Benefit Guaranty Corporation, or any successor
thereto.
"Percentage" means, with respect to each Lender, the fraction, expressed as
a percentage, (i) the numerator of which equals such Lender's Commitment and
(ii) the denominator of which equals the Aggregate Commitment.
"Permitted Liens" means any one or more of the following: (a) Liens for
taxes, assessments or other governmental charges or levies either not yet
delinquent or which are being contested in good faith by appropriate proceedings
diligently prosecuted and as to which adequate reserves shall have been set
aside in conformity with Agreement Accounting Principles, (b) deposits or
pledges to secure the payment of workers' compensation, unemployment insurance,
social security benefits or obligations arising under similar legislation, or to
secure the performance of public or statutory obligations, surety or appeal
bonds, and other obligations of a like nature incurred in the ordinary course of
business, (c) materialmen's, mechanics', workmen's, repairmen's, employees's,
landlord's, lessor's or other like Liens arising in the ordinary course of
business to secure obligations not more than 30 days past due or being contested
in good faith and as to which adequate reserves shall have been set aside in
conformity with Agreement Accounting Principles or as to which adequate bonds
shall have been obtained, (d) Liens arising under Section 9.319 of the Texas
Uniform Commercial Code or similar statutes of states other than Texas, (e)
zoning restrictions, easements, rights-of-way, restrictions, servitudes,
permits, reservations, encroachments, exceptions, conditions, covenants, and any
other restrictions on the use of real property none of which materially impairs
the use of such property by the owner of such property in the operation of its
business, (f) liens in favor of the Agent for pro rata benefit of Lenders, or to
the Lenders to secure the Obligations, (g) inchoate Liens arising under ERISA,
(h) Liens reserved in customary oil, gas and/or mineral leases for bonus or
rental payments and for compliance with the terms of such leases and Liens
reserved in customary operating agreements, farm-out and farm-in agreements,
exploration agreements, development agreements and other similar agreements for
compliance with the terms of such agreements, (i) any obligations or duties
affecting any of the Property of any Person to any
15
municipality or public authority with respect to any franchise, grant, license
or permit which do not materially impair the use of such Property for the
purposes for which it is held, (j) defects, irregularities and deficiencies in
title to any Property of any Person which in the aggregate do not materially
impair the use of such Property for the purposes for which such Property is held
by the Borrower, and defects, irregularities and deficiencies in title to any
Property of the Borrower which defects, irregularities or deficiencies have been
cured by possession under applicable statutes of limitation, (k) royalties,
overriding royalties, revenue interests, net revenue interests, production
payments (other than royalties, overriding royalties, revenue interests, net
revenue interests or production payments granted or created by such Person or
any of its Subsidiaries in the ordinary course of business in connection with,
or having the effect of, the borrowing of money), advance payment obligations
(other than obligations in respect of advance payments received by such Person
or any of its Subsidiaries in connection with, or having the effect of, the
borrowing of money) and other similar burdens now existing on Properties now
owned or, as to Properties hereafter acquired, at the time of acquisition by
such Person, (l) Liens arising out of all presently existing and future division
and transfer orders, advance payment agreements, processing contracts, gas
processing plant agreements, operating agreements, gas balancing or deferred
production agreements, pooling, unitization or communitization agreements,
pipeline, gathering or transportation agreements, platform agreements, drilling
contracts, injection or repressuring agreements, cycling agreements,
construction agreements, salt water or other disposal agreements, leases or
rental agreements (but only as otherwise permitted by this Agreement), farm-out
and farm-in agreements, exploration and development agreements, and any and all
other contracts or agreements covering, arising out of, used or useful in
connection with or pertaining to the exploration, development, operation,
production, sale, use, purchase, exchange, storage, separation, dehydration,
treatment, compression, gathering, transportation, processing, improvement,
marketing, disposal or handling of any Property of a Person, provided such
agreements are entered into the ordinary course of business and contain terms
customary for such agreements in the industry, and (m) in the case of the
Borrower and its Subsidiaries, other minor liens or encumbrances none of which
interferes materially with the use of the Property affected in the ordinary
conduct of the Borrower's and/or its Subsidiaries business and which
individually or in the aggregate do not have a Material Adverse Effect.
"Person" means any natural person, corporation, firm, joint venture,
partnership, association, enterprise, limited liability company, trust or other
entity or organization, or any government or political subdivision or any
agency, department or instrumentality thereof.
"Plan" means an employee pension benefit plan which is covered by Title IV
of ERISA or subject to the minimum funding standards under Section 412 of the
Code as to which the Borrower or any member of the Controlled Group may have any
liability.
16
"Processing Supply Contract" means any contract (including, without
limitation, physical delivery, option (whether cash or financial), exchange,
swap and futures contracts) entered into by the Borrower or any of its
Subsidiaries in the ordinary course of business for the purpose of managing the
impact of price fluctuations on natural gas supply costs related to any natural
gas processing activity conducted by the Borrower or any of its Subsidiaries.
"Project Financing" shall mean any Debt incurred to finance a project
(including any construction financing) which does not permit recourse to the
Borrower or any of its Subsidiaries (other than a Project Financing Subsidiary)
or any of their respective Property other than the Property of a Project
Financing Subsidiary.
"Project Financing Subsidiary" shall mean (i) any Subsidiary of the
Borrower or (ii) any other Person in which the Borrower owns a 50% or less
interest, in each case, whose principal purpose is to incur Project Financing or
to become an owner of interests in a Person so created to conduct the business
activities for which such Project Financing was incurred, and substantially all
the fixed assets of which Subsidiary or Person are those fixed assets being
financed (or to be financed) in whole or in part by one or more Project
Financings.
"Property" of a Person means any and all property, whether real, personal,
tangible, intangible, or mixed, of such Person, or other assets owned, leased or
operated by such Person, and includes, without limitation, stock, partnership
and limited liability company interests owned or held in any other Person by
such Person.
"Purchaser" is defined in Section 12.3.1.
"Rate Option" means the Alternate Base Rate or the Eurodollar Rate.
"Rating Agency" means either of S&P or ▇▇▇▇▇'▇.
"Reducing Lender" is defined in Section 2.21.
"Reduction Amount" means the amount by which a Reducing Lender's or a
Partially Increasing Lender's outstanding Loans decrease as of a Commitment
Increase Effective Date (without regard to any such increase as a result of
Advances made on such Commitment Increase Effective Date).
"Reference Banks" means each of the Agent and The First National Bank of
Chicago.
"Regulation D" means Regulation D of the Board of Governors of the Federal
Reserve System as from time to time in effect and any successor thereto or other
regulation or official
17
interpretation of said Board of Governors relating to reserve requirements
applicable to member banks of the Federal Reserve System.
"Regulation U" means Regulation U of the Board of Governors of the Federal
Reserve System as from time to time in effect and any successor or other
regulation or official interpretation of said Board of Governors relating to the
extension of credit by banks for the purpose of purchasing or carrying margin
stocks applicable to member banks of the Federal Reserve System.
"Reportable Event" means a reportable event as defined in Section 4043 of
ERISA and the regulations issued under such section, with respect to a Single
Employer Plan, excluding, however, such events as to which the PBGC by
regulation waived the requirement of Section 4043(a) of ERISA that it be
notified within 30 days of the occurrence of such event, provided, however, that
a failure to meet the minimum funding standard of Section 412 of the Code and of
Section 302 of ERISA shall be a Reportable Event regardless of the issuance of
any such waiver of the notice requirement in accordance with either Section
4043(a) of ERISA or Section 412(d) of the Code.
"Required Lenders" means Lenders in the aggregate having at least 60% of
the Aggregate Commitment or, if the Aggregate Commitment has been terminated,
Lenders in the aggregate holding at least 60% of the sum of (i) the Letter of
Credit Liabilities and (ii) the aggregate unpaid principal amount of the
outstanding Advances.
"Reserve Requirement" means, with respect to a Eurodollar Interest Period,
the maximum aggregate reserve requirement, if any, (including all basic,
supplemental, marginal and other reserves) which is imposed on Eurocurrency
liabilities (in the case of Eurodollar Advances or Eurodollar Loans). The
Reserve Requirement shall be adjusted automatically on and as of the effective
date of any change in the applicable reserve requirement.
"Risk-Based Capital Guidelines" is defined in Section 3.2.
"Rolling Period" means for each calendar quarter, such quarter and the
three preceding calendar quarters.
"S&P" means Standard & Poor's Ratings Services, a division of The ▇▇▇▇▇▇-
▇▇▇▇ Companies, Inc., and any successor thereto that is a nationally-recognized
rating agency.
"Section" means a numbered section of this Agreement, unless another
document is specifically referenced.
18
"Single Employer Plan" means a Plan that is not a Multiemployer Plan.
"Stated Amount" means the total amount of a Letter of Credit as reduced by
any drawings thereunder.
"Stated Maturity Date" means the date set forth in each Letter of Credit
issued pursuant hereto as the expiration date for such Letter of Credit;
provided, however, in no event shall the Stated Maturity Date exceed the
Facility Maturity Date.
"Subsidiary" of a Person means (i) any corporation more than 50% of the
outstanding securities having ordinary voting power of which shall at the time
be owned directly or indirectly, by such Person or by one or more of its
Subsidiaries or by such Person and one or more of its Subsidiaries, or (ii) any
partnership, association, joint venture, limited liability company or similar
business organization more than 50% of the ownership interests having ordinary
voting power of which shall at the time be so owned. Unless otherwise expressly
provided, all references herein to a "Subsidiary" shall mean a direct or
indirect Subsidiary of the Borrower.
"Subsidiary Guaranty" means (i) in the case of NGC or any Subsidiary of the
Borrower (other than Trident and its Subsidiaries) the Guaranty Agreement
substantially in the form of Exhibit "H-1" and (ii) in the case of Trident and
its Subsidiaries, the Guaranty Agreement substantially in the form of Exhibit
"H-2", as amended or modified from time to time.
"Substantial Portion" means, with respect to the Property of the Borrower
and its Subsidiaries, Property which (i) represents more than 15% of the
consolidated assets of the Borrower and its Subsidiaries as shown in the
consolidated financial statements of the Borrower and its Subsidiaries most
recently delivered to the Lenders pursuant to Section 6.1.1 (or, if no such
statements have been delivered, the statements referred to in Section 5.4) or
(ii) is responsible for more than 15% of the Consolidated EBITD for the Rolling
Period ending with the calendar quarter immediately prior to the quarter in
which such determination is made.
"Transferee" is defined in Section 12.4.
"Tribunal" means any state, commonwealth, federal, foreign, territorial, or
other court or governmental department, commission, board, bureau, agency, or
instrumentality or any properly convened arbitration.
"Trident" means Trident NGL, Inc., a Delaware corporation.
19
"Trident Merger" means the merger, consolidation or combination of NGC's
partners into or with Old NGC, with Old NGC being the surviving corporation
pursuant to the Trident Merger Agreement.
"Trident Merger Agreement" means the Combination Agreement and Plan of
Merger by and among NGC and Trident NGL Holding, Inc. and others dated as of
October 21, 1994.
"Type" means, with respect to any Advance, its nature as a Base Rate
Advance or a Eurodollar Advance.
"UCC" means the Uniform Commercial Code in effect from time to time in the
State of Illinois.
"Unfunded Liabilities" means the amount (if any) by which the present value
of all vested nonforfeitable benefits under all Single Employer Plans exceeds
the fair market value of all such Plan assets allocable to such benefits, all
determined as of the then most recent valuation date for such Plans.
"Unmatured Default" means an event or condition which but for the lapse of
time or the giving of notice, or both, would constitute a Default.
The foregoing definitions shall be equally applicable to both the singular
and plural forms of the defined terms.
1.2 Accounting Terms and Other Determinations. Unless otherwise specified
herein, all accounting terms used herein shall be interpreted, all accounting
determinations hereunder shall be made, and all financial statements required to
be delivered hereunder shall be prepared in accordance with Agreement Accounting
Principles. The words "herein," "hereof," "hereunder," and words of similar
import refer to this Agreement as a whole and not to a particular article,
section, paragraph or other subdivision. All other terms used herein shall have
the meanings stated herein or, if not otherwise defined herein, the meanings for
such terms provided in the UCC.
20
ARTICLE II
THE FACILITY
2.1 The Loan Facility.
2.1.1 Description of Loan Facility. The Lenders grant to the Borrower a
credit facility (the "Loan Facility") pursuant to which, and upon the terms and
subject to the conditions herein set out:
(i) each Lender severally agrees to make Loans in U.S. Dollars to the
Borrower in accordance with Section 2.1.3;
(ii) in no event may the sum of the aggregate principal amount of all
outstanding Loans made by a given Lender to the Borrower exceed the amount
equal to (A) such Lender's Commitment, less (B) the Stated Amount of all
outstanding Letters of Credit issued by such Lender, less (C) the
Borrower's unpaid reimbursement obligations to such Lender with respect to
the amounts paid by such Lender pursuant to Letters of Credit (which
reimbursement obligations have not been deemed to be automatic Base Rate
Advances pursuant to Section 2.2.3);
(iii) in no event may any new Advance requested by the Borrower exceed
the Borrower's reimbursement obligations to the Lenders with respect to the
amounts paid by such Lenders pursuant to Letters of Credit.
2.1.2 Availability of Facility. Subject to the terms of this Agreement,
the Loan Facility is available for borrowing from the date of this Agreement to
the Commitment Termination Date for the sole purpose of paying the Borrower's
reimbursement obligations to the Lenders with respect to the amounts paid by
such Lenders pursuant to Letters of Credit or for converting or continuing
Advances previously made.
2.1.3 Advances. Each Advance hereunder shall consist of borrowings made
from each Lender to reimburse such Lender for any funds disbursed by such Lender
pursuant to any draft drawn or demand made under any Letter of Credit issued by
such Lender pursuant hereto or to convert or continue Advances previously made.
Each new Advance made by each Lender hereunder shall be deemed to be applied by
such Lender to the reimbursement of such Lender for the amount actually
disbursed by such Lender pursuant to a draft drawn or demand made under each
Letter of Credit issued by such Lender. The Advances and all reimbursement
obligations to the Lenders with respect to the amounts paid by such Lenders
pursuant to Letters of Credit,
21
which reimbursement obligations have not been repaid by the Borrower, shall be
evidenced by the Notes.
2.1.4 Lender's Several Obligations. The obligations of each Lender to
make Loans hereunder is the several (and not joint) obligation of such Lender,
and neither the Agent nor any other Lender shall have any obligation to make
Loans to the Borrower for the purpose of reimbursing such Lender for any funds
disbursed by such Lender pursuant to any draft drawn or demand made under a
Letter of Credit issued by such Lender.
2.1.5 Types of Advances. Advances may be Base Rate Advances, or
Eurodollar Advances, or a combination thereof.
2.2 The Letter of Credit Facility.
2.2.1 Issuance of Letters of Credit. Subject to the terms and conditions
of this Agreement, and provided that no Default or Unmatured Default has
occurred and is continuing and the Borrower has provided the Agent with an
Issuance Request and telephonic notice of the transmission of such Issuance
Request, each Lender severally agrees to issue one or more Letters of Credit
from time to time prior to the Commitment Termination Date for the account of
the Borrower in an amount equal to the product of (a) such Lender's Percentage,
multiplied by (b) the amount set forth in such Issuance Request; it being
understood and agreed that subject to the other terms of this Agreement the
Borrower may obtain for its account Letters of Credit on behalf of any of its
Subsidiaries. Each Letter of Credit shall be issued for the purpose of securing
the obligations of the Borrower and/or any of its Subsidiaries under the Gas
Purchase Agreement, shall have a Stated Maturity Date on or before the Facility
Maturity Date, and shall be substantially in the form of Exhibit "B-1" and all
legal and regulatory matters in respect of each Letter of Credit to be issued by
a Lender shall be reasonably satisfactory to such Lender. Each Lender will
immediately notify the Agent of the issuance of each Letter of Credit by such
Lender and immediately provide a copy of each Letter of Credit issued by such
Lender to the Agent; provided that the failure to so notify the Agent or so
provide a copy to the Agent shall not limit or impair the Borrower's Obligations
hereunder, including, without limitation, its Obligations to reimburse drawings
under or in respect of each such Letter of Credit. Subject to the terms of this
Agreement, the amount, expiry date, date of issuance and the beneficiary of each
Letter of Credit shall be as specified by the Borrower in a written Issuance
Request delivered, together with a telephonic notice of the transmission of such
Issuance Request, to the Agent (by messenger, mail or electronic transmission,
including facsimile transmission) not less than three (3) Business Days prior to
the requested date of issuance. The Letters of Credit shall not have an
expiration date later than 5:00 p.m. (New York time) on the Facility Maturity
Date.
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2.2.2 Aggregate Amount Available under Letters of Credit. The aggregate
Stated Amount of all outstanding Letters of Credit issued by a given Lender at
any one time shall not exceed such Lender's Commitment, and after the issuance
of a Letter of Credit, no Lender shall be required to issue any Letter of Credit
if, after giving effect thereto, (A) the aggregate Stated Amount of all
outstanding Letters of Credit issued by such Lender, plus (B) the Borrower's
unpaid reimbursement obligations to such Lender with respect to the amounts paid
by such Lender pursuant to Letters of Credit (which reimbursement obligations
have not been deemed to be automatic Base Rate Advances pursuant to Section
2.2.3), plus (C) the aggregate principal amount of all outstanding Loans made by
such Lender, would exceed such Lender's Commitment.
2.2.3 Reimbursement of Lenders; Automatic Advances. The Borrower hereby
irrevocably agrees that it shall provide the Agent with immediately available
and freely transferable funds in an amount equal to the amount to be paid by
each Lender upon any drawing under a Letter of Credit, and telephonic notice of
same, by 2:00 p.m. (New York time) on the date on which such drawing is to be
paid by such Lender (the "Draw Date"). Each Lender shall promptly notify the
Borrower and the Agent on the Business Day (which notices may be telephonic,
promptly confirmed by telecopy) that a draw request or demand has been made
under a Letter of Credit. If the Borrower does not request or is not eligible
for an Advance hereunder and does not otherwise provide the Lenders with funds,
in the amount and on the date necessary to settle the obligations of the Lenders
under any draft drawn or demand made under a Letter of Credit (whether at or
prior to the expiration of such Letter of Credit) issued for its account, the
Borrower will be deemed to have given a Borrowing Notice to the Agent requesting
that the Lenders make a Base Rate Advance on the date on which such drawing is
honored in an amount equal to the amount of such drawing and, to the extent
permitted by law, the Lenders shall make, and the Borrower shall accept, a Base
Rate Advance (consisting of Base Rate Loans made by the Lenders in the amount
actually disbursed by each such Lender pursuant to the Letters of Credit issued
by such Lender) in the amount actually disbursed by the Lenders pursuant to such
draft or demand. Such Base Rate Advance shall be deemed to have been made as of
the Draw Date, and the proceeds of such Base Rate Advance shall be deemed to
have been applied by each Lender to the reimbursement of such Lender for the
amount actually disbursed by such Lender pursuant to such draft or demand. If
such Base Rate Advance cannot be made or accepted pursuant to the terms hereof
and the Borrower does not provide the Agent with immediately available and
freely transferable funds in such amount, the reimbursement obligation of the
Borrower to the Lenders shall bear interest (calculated for the actual number of
days elapsed on the basis of a year consisting of 365, or when appropriate, 366
days) until paid at a rate per annum equal to the rate that would have been in
effect if a Base Rate Advance had been made by the Lender to the Borrower and,
from and after the twentieth (20th) day after the Draw Date the applicable rate
of interest shall be the Alternate Base Rate plus 2%. Notwithstanding anything
herein to the contrary, a Default shall not occur unless the Borrower fails to
repay any such reimbursement
23
obligation (via Advances under the Loan Facility or otherwise) within twenty
(20) days after the Draw Date.
2.2.4 Lender's Several Obligations. The obligations of each Lender
issuing a Letter of Credit to satisfy any draft or demand made under such Letter
of Credit is the several (and not joint) obligation of such Lender, and neither
the Agent nor any other Lender shall have any obligation to reimburse the Lender
issuing such Letter of Credit for any funds disbursed by such Lender pursuant to
any draft drawn or demand made under such Letter of Credit.
2.2.5 Letter of Credit Fees. The Borrower hereby agrees to pay to the
Agent for the pro rata benefit of the Lenders, as determined by each Lender's
Percentage, a Letter of Credit participation fee equal to the Applicable Margin
per annum (calculated for the actual number of days elapsed on the basis of a
year consisting of 365, or when appropriate 366, days) on the daily average
Stated Amount of each Letter of Credit issued from and including the date issued
to and including the date of its expiration or earlier termination. The
Borrower shall pay to the Agent the Letter of Credit participation fee due with
respect to each outstanding Letter of Credit on each Payment Date in respect of
each Letter of Credit outstanding during the calendar quarter during which such
Payment Date occurs, commencing on the first Payment Date to occur after such
Letter of Credit is issued, and on the Commitment Termination Date. The Agent
shall promptly remit to each Lender its Percentage of each Letter of Credit
participation fee after its receipt by the Agent.
2.2.6 Modification of Outstanding Letters of Credit. Subject to the terms
of this Agreement (including, without limitation, those applicable to the
issuance of a new Letter of Credit), and provided that no Default or Unmatured
Default has occurred and is continuing, in lieu of delivering an Issuance
Request for additional Letters of Credits in accordance herewith, the Borrower
may from time to time modify the Stated Maturity Date or Stated Amount of
outstanding Letters of Credit by delivering to the Agent an L/C Modification
Notice, together with telephonic notice of the transmission of same, not less
than three (3) Business Days prior to the Business Day on which the Borrower
wishes such modification to be effective; provided that any such L/C
Modification Notice that seeks any reduction in the Stated Maturity Date or
Stated Amount of any outstanding Letters of Credit shall be accompanied by and
made and effective on, and only on, the terms set forth in a CUSA Certificate
delivered to the Agent with the L/C Modification Notice; and provided, further,
that each such L/C Modification Notice shall provide for a comparable
modification to the outstanding Letters of Credit of each Lender and any
proposed reduction or increase in the Stated Amount of outstanding Letters of
Credit shall apply ratably to all outstanding Letters of Credit. Each such
modification of any outstanding Letters of Credit shall be substantially in the
form of Exhibit "B-2" and all legal and regulatory matters in respect of each
such modification to be issued by a Lender shall be reasonably satisfactory to
such Lender. Each Lender will immediately notify the Agent of the issuance of
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each such modification by such Lender and immediately provide a copy of each
such modification issued by such Lender to the Agent; provided that the failure
to so notify the Agent or so provide a copy to the Agent shall not limit or
impair the Borrower's Obligations hereunder, including, without limitation, its
Obligations to reimburse drawings under or in respect of each modified Letter of
Credit. The Letters of Credit, as modified pursuant to this Section, shall not
have an expiration date later than 5:00 p.m. (New York time) on the Facility
Maturity Date.
2.2.7 Verification. Neither the Agent nor any Lender shall have any duty
to verify or make any inquiry with regard to the truth or accuracy of any
statement made in any draft or document presented to the Agent or any Lender
under any Letter of Credit, and neither the Agent nor any Lender shall have any
duty to make any inquiry into the genuineness of any signature on any such draft
or document or into the due authorization of any party to execute or present
such draft or document or to receive payment under any Letter of Credit; unless,
and to the extent, that the Borrower has provided the Agent with sufficient
funds to reimburse each Lender for any demand or draw under a Letter of Credit
issued by such Lender, and thereafter a court of competent jurisdiction
determines that the Agent or such Lender was grossly negligent (and not simply
negligent or contributorily negligent) or guilty of willful misconduct for
making such payment in which case the maximum liability of the Agent or such
Lender, as the case may be, shall not exceed the direct damages resulting
therefrom. In no event shall the Agent or any Lender be liable for punitive or
consequential damages.
2.2.8 Irrevocable Obligations and Commercial Practices. Neither the Agent
nor any Lender shall be responsible in connection with any Letter of Credit
issued hereunder for, and the obligation of the Borrower set forth in Section
2.2.3 to provide the Agent with funds to reimburse the Lenders for amounts
disbursed by each Lender pursuant to drafts or demands made under any Letter of
Credit issued shall be irrevocable, not subject to any qualification or
exception whatsoever and shall be made in accordance with the terms of this
Agreement under all circumstances and notwithstanding, (i) payment made pursuant
to any Letter of Credit despite the failure of any draft to bear any reference
or adequate reference to the Letter of Credit, or the failure of any Person to
note the amount of any drawing on the Letter of Credit; (ii) errors, omissions,
interruptions, or delays in transmission or delivery of any messages, in person,
by mail, cable, telegraph, wireless or otherwise whether or not they may be in
cipher; (iii) any use which may be made of any Letter of Credit; (iv) any acts
or omissions of any beneficiary under any Letter of Credit; (v) the form,
validity, sufficiency, or genuineness of documents, or any endorsements(s)
thereon, even if such documents should in fact prove to be in any and all
respects invalid, insufficient, fraudulent, or forged; (vi) the sufficiency or
genuineness of any messages or instructions to issue a Letter of Credit, or any
of the terms thereof, howsoever delivered or transmitted by any Obligor to the
Agent or any Lender; or (vii) the existence of any claim, setoff, defense or
other right which any Obligor may have at any time against a beneficiary named
in any Letter of Credit or any transferee of any Letter of Credit (or any
25
Person for whom any such transferee may be acting), the Agent, any Lender, or
any other Person, whether in connection with this Agreement, any Letter of
Credit, the transactions contemplated herein or any unrelated transactions
(including, without limitation, any underlying transactions between any Obligor
or any Affiliate of any Obligor and the beneficiary named in any Letter of
Credit) other than a defense based on the gross negligence or willful misconduct
of such Lender as determined by a court of competent jurisdiction. The happening
of any one or more of the contingencies referred to in the preceding sentence
shall not affect, impair, or prevent the vesting of any of the Agent's or any
Lender's rights or powers under this Agreement or any other Loan Documents. The
Agent or any Lender may receive, accept, or pay as complying with the terms of
any Letter of Credit, any drafts or other documents, otherwise in order, which
may be signed by, or issued to, the administrator or executor of, or the trustee
in bankruptcy of, or the receiver for any of the property of, the party in whose
name such Letter of Credit provides that any drafts or any other documents
should be drawn or issued. In furtherance and extension but not in limitation of
the foregoing provisions, it is hereby further agreed that any action, inaction,
or omission taken or suffered by the Agent or any Lender under or in connection
with any Letter of Credit or any drafts or documents referenced herein shall be
binding upon the Obligors and the Lenders and shall not place the Agent or any
Lender under any resulting liability to any Obligor or any Lender.
Notwithstanding the foregoing, to the extent that an Obligor has reimbursed the
Agent or the applicable Lender for any draw or demand under a Letter of Credit
issued for its account and thereafter a court of competent jurisdiction
determines that the Agent or such Lender did not act in good faith and in
substantial conformity with such Person's customary practices and such domestic
laws and customs or regulations as such Person deemed applicable thereto or was
guilty of gross negligence (and not simply negligence or contributory
negligence) or willful misconduct in honoring such demand or draw, the Agent or
such Lender, as the case may be, shall be liable to such Obligor for such
action, gross negligence or willful misconduct provided that in any event the
maximum liability of the Agent or such Lender, as the case may be, shall not
exceed the direct damages resulting therefrom. In no event shall the Agent or
any Lender be liable for punitive or consequential damages.
2.2.9 Letter of Credit Collateral Account. The Borrower hereby agrees
that it will, until the final expiration date of any Letter of Credit and
thereafter as long as any amount is payable to the Lenders in respect of any
Letter of Credit, maintain a special collateral account (the "Letter of Credit
Collateral Account") at the Agent's office at the address specified pursuant to
Article XIII or as otherwise directed by the Agent, in the name of the Borrower
but under the sole dominion and control of the Agent, for the benefit of the
Lenders and in which the Borrower shall have no interest other than as set forth
in Section 8.1. The Agent will invest any funds on deposit from time to time in
the Letter of Credit Collateral Account in (i) certificates of deposit having a
maturity not exceeding 30 days, (ii) short-term obligations of, or fully
guaranteed by, the United States of America, or (iii) commercial paper rated A-l
or better by S&P or P-l or
26
better by ▇▇▇▇▇'▇. Nothing in this Section 2.2.9 shall (i) obligate the Borrower
to deposit any funds in the Letter of Credit Collateral Account, (ii) obligate
the Agent to require the Borrower to deposit any funds in the Letter of Credit
Collateral Account or (iii) limit the right of the Agent to release any funds
held in the Letter of Credit Collateral Account other than as required by
Section 8.1. The Borrower hereby grants to the Agent for the benefit of the
Lenders a security interest in the Letter of Credit Collateral Account and any
funds or investments in such account.
2.3 Required Payments. Any outstanding Advances shall be payable on the
Commitment Termination Date. All reimbursement obligations (which reimbursement
obligations have not been deemed to be automatic Base Rate Advances pursuant to
Section 2.2.3) and all other unpaid Obligations shall be paid in full by the
Borrower on demand.
2.4 Fees.
2.4.1 Commitment Fees. The Borrower hereby agrees to pay to the Agent for
the account of each Lender, ratably in the proportion that such Lender's
Commitment bears to the Aggregate Commitment, a commitment fee (calculated for
the actual number of days elapsed on the basis of a year consisting of 365, or
when appropriate 366, days) equal to the Applicable Commitment Fee on the
average daily unused amount of the Aggregate Commitment (it being understood
that the Stated Amount of all outstanding Letters of Credit is usage of the
Aggregate Commitment), payable quarterly in arrears on the third Business Day
after each Payment Date and on the Commitment Termination Date.
2.4.2 Cancellation. The Borrower may at any time after the date hereof
cancel the Aggregate Commitment, in whole, or in a minimum aggregate amount of
$15,000,000 (and in integral multiples of $5,000,000) ratably among the Lenders
upon at least three Business Days' prior written notice to the Agent, which
notice shall specify the amount of such reduction; provided, however, no such
notice of cancellation shall be effective to the extent that it would reduce the
Aggregate Commitment to an amount which would be less than the outstanding
principal amount of all Advances, plus the Stated Amount of all Letters of
Credit outstanding, plus reimbursement obligations to the Lenders with respect
to the amounts paid by such Lenders pursuant to Letters of Credit which
reimbursement obligations have not been repaid by the Borrower and have not been
deemed to be automatic Base Rate Advances pursuant to Section 2.2.3 at the time
such cancellation is to take effect. Any notice of cancellation given pursuant
to this Section 2.4.2 shall be irrevocable and permanent and shall specify the
date upon which such cancellation is to take effect. The Agent shall promptly
notify each Lender of its receipt of notice from the Borrower electing to cancel
all or a portion of the Aggregate Commitment. Each partial cancellation of the
Aggregate Commitment shall cancel each Lender's Commitment ratably in proportion
to the ratio that such Lender's Commitment bears to the Aggregate Commitment.
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2.5 Minimum Amount of Each Eurodollar Advance. Each Eurodollar Advance
shall be in the minimum amount of $10,000,000. Each Advance which fails to
satisfy the minimum requirements set forth in this Section for a Eurodollar
Advance shall be deemed a Base Rate Advance.
2.6 Optional Principal Payments. The Borrower may from time to time
pay, without penalty or premium (other than amounts payable as provided in
Section 3.4, if any, as a result of such prepayment being made other than on the
last day of a Eurodollar Interest Period with respect to any Eurodollar Advance
as provided in Section 3.4), all outstanding Advances, or, in a minimum
aggregate amount of $5,000,000 or any integral multiple of $1,000,000 in excess
thereof, any portion of the outstanding Advances upon (3) three Business Days'
(or, in the case of outstanding Advances bearing interest at the Alternate Base
Rate, (1) one Business Day's) prior notice to the Agent.
2.7 Method of Selecting Types and Interest Periods for New Advances.
The Borrower shall select the Type of Advance and, in the case of each
Eurodollar Advance, the Eurodollar Interest Period applicable to each Eurodollar
Advance from time to time; provided, that the Borrower will not select such
Eurodollar Interest Periods with regard to Eurodollar Loans so that more than
eight (8) Eurodollar Interest Periods with regard to Eurodollar Loans are in
effect at any time. The Borrower shall give the Agent irrevocable notice (a
"Borrowing Notice") not later than [10:00] a.m. (New York time) at least (1) one
Business Day before the Borrowing Date of each Base Rate Advance and (3) three
Business Days before the Borrowing Date for each Eurodollar Advance, specifying:
(i) the Borrowing Date, which shall be a Business Day, of such
Advance,
(ii) the aggregate amount of such Advance,
(iii) the Type of Advance selected, and
(iv) in the case of a Eurodollar Advance, the Eurodollar Interest
Period applicable thereto.
Not later than noon (New York time) on each Borrowing Date, each Lender shall
apply its Loan made in connection with such Advance in payment of the
Obligations hereunder to reimburse such Lender for any funds disbursed by such
Lender pursuant to any draft drawn or demand made under any Letter of Credit
issued by such Lender pursuant hereto.
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2.8 Conversion and Continuation of Outstanding Advances. Base Rate
Advances shall continue as Base Rate Advances unless and until converted into
Eurodollar Advances. Each Eurodollar Advance shall continue as a Eurodollar
Advance until the end of the then applicable Eurodollar Interest Period
therefor, at which time such Eurodollar Advance shall be automatically converted
into a Base Rate Advance unless the Borrower shall have given the Agent a
Conversion/Continuation Notice requesting that, at the end of such Eurodollar
Interest Period, such Eurodollar Advance either continue as a Eurodollar Advance
for the same or another Eurodollar Interest Period or be converted into a Base
Rate Advance. Subject to the terms of Section 2.7, the Borrower may elect from
time to time to convert all or any part of an Advance of either Type into the
other Type of Advance; provided that any conversion of any Eurodollar Advance
shall be made on, and only on, the last day of the Eurodollar Interest Period
applicable thereto. The Borrower shall give the Agent irrevocable notice (a
"Conversion/Continuation Notice") of each conversion of an Advance or each
continuation of a Eurodollar Advance not later than [10:00] a.m. (New York time)
at least (1) one Business Day, in the case of a conversion into a Base Rate
Advance, or (3) three Business Days, in the case of a conversion into or a
continuation of a Eurodollar Advance, prior to the date of the requested
continuation, specifying:
(i) the requested date which shall be a Business Day, of such
conversion or continuation;
(ii) the aggregate amount and Type of the Advance which is to be
converted or continued; and
(iii) the amount and Type(s) of Advance(s) into which such Advance is
to be converted or continued and, in the case of a conversion into or
continuation of a Eurodollar Advance, the duration of the Eurodollar
Interest Period applicable thereto.
2.9 Changes in Interest Rate, etc. Each Base Rate Advance shall bear
interest on the outstanding principal amount thereof, for each day from and
including the date such Advance is made or is converted from a Eurodollar
Advance into a Base Rate Advance pursuant to Section 2.10 to but excluding the
date it becomes due or is converted into a Eurodollar Advance pursuant to
Section 2.10 hereof, at a rate per annum equal to the Alternate Base Rate for
such day. Changes in the rate of interest on that portion of any Advance
maintained as a Base Rate Advance will take effect simultaneously with each
change in the Alternate Base Rate. Each Eurodollar Advance shall bear interest
from and including the first day of the Eurodollar Interest Period applicable
thereto to (but not including) the last day of such Eurodollar Interest Period
at the interest rate determined as applicable to such Eurodollar Advance. No
Eurodollar Interest Period may end after the Commitment Termination Date.
29
2.10 Rates Applicable After Default. Notwithstanding anything to the
contrary contained in Section 2.8, during the continuance of a Default or
Unmatured Default the Required Lenders may, at their option, by notice to the
Borrower (which notice may be revoked at the option of the Required Lenders
notwithstanding any provision of Section 8.2 requiring unanimous consent of the
Lenders to changes in interest rates), declare that no Advance may be made as,
converted into or continued as a Eurodollar Advance. If any Advance is not paid
at maturity, whether by acceleration or otherwise, the Required Lenders may, at
their option, by notice to the Borrower (which notice may be revoked at the
option of the Required Lenders notwithstanding any provision of Section 8.2
requiring unanimous consent of the Lenders to changes in interest rates),
declare that (i) each Eurodollar Advance shall bear interest for the remainder
of the applicable Eurodollar Interest Period at the rate otherwise applicable to
such Eurodollar Interest Period plus 2% per annum and (ii) each Base Rate
Advance shall bear interest at a rate per annum equal to the Alternate Base Rate
otherwise applicable to the Base Rate Advance plus 2% per annum.
2.11 Method of Payment. All payments of Obligations actually made by the
Borrower hereunder shall be made, without setoff, deduction, or counterclaim, in
immediately available funds to the Agent at the Agent's address specified
pursuant to Article XIII, or at any other Lending Installation of the Agent
specified in writing by the Agent to the Borrower, by 2:00 p.m. (New York time)
on the date when due and shall be applied ratably by the Agent among the
Lenders. Funds received after that time shall be deemed to have been received by
the Agent on the next succeeding Business Day. Each payment delivered to the
Agent for the account of any Lender shall be delivered promptly by the Agent to
such Lender in the same type of funds that the Agent received at its address
specified pursuant to Article XIII or at any Lending Installation specified in a
notice received by the Agent from such Lender.
2.12 Notes; Notices. Each Lender is hereby authorized to record the
principal amount of each of its Loans and each repayment on the schedule
attached to its Notes, provided, however, that the failure to so record shall
not affect the Borrower's obligations under such Notes. The Borrower hereby
authorizes the Lenders and the Agent to extend, convert or continue Advances,
effect selections of Types of Advances and to transfer funds based on telephonic
or telecopy notices made by any person or persons the Agent or any Lender in
good faith believes to be acting on behalf of the Borrower. The Borrower agrees
to deliver promptly to the Agent a written confirmation, if such confirmation is
requested by the Agent or any Lender, of each telephonic or telecopy notice
signed by an Authorized Officer. If the written confirmation differs in any
material respect from the action taken by the Agent and the Lenders, the records
of the Agent and the Lenders shall govern absent manifest error.
2.13 Interest Payment Dates; Interest and Fee Basis. Interest accrued
on each Base Rate Advance shall be payable on each Payment Date, commencing with
the first such date to
30
occur after the date hereof, on any date on which the Base Rate Advance is
prepaid, whether due to acceleration or otherwise, and on the Commitment
Termination Date. Interest accrued on that portion of the outstanding principal
amount of any Base Rate Advance converted into a Eurodollar Advance on a day
other than a Payment Date shall be payable on the date of conversion. Interest
accrued on each Eurodollar Advance shall be payable on the last day of its
applicable Eurodollar Interest Period, on any date on which such Eurodollar
Advance is prepaid, whether by acceleration or otherwise, and on the Commitment
Termination Date. Interest accrued on each Eurodollar Advance having a
Eurodollar Interest Period longer than three months shall also be payable on the
last day of each three-month interval during such Eurodollar Interest Period.
Interest on Eurodollar Advances shall be calculated for actual days elapsed on
the basis of a 360-day year. Fees payable hereunder and interest on Base Rate
Advances shall be calculated for the actual number of days elapsed on the basis
of a year consisting of 365, or where appropriate, 366 days. Interest shall be
payable for the day an Advance is made but not for the day of any payment on the
amount paid if payment is received prior to 2:00 p.m. (New York time) at the
place of payment. If any payment of principal of or interest on an Advance shall
become due on a day which is not a Business Day, such payment shall be made on
the next succeeding Business Day and, in the case of a principal payment, such
extension of time shall be included in computing interest in connection with
such payment.
2.14 Notification of Advances, Interest Rates, Prepayments and
Commitment Reductions. Promptly after receipt thereof, the Agent will notify
each Lender of the contents of each Aggregate Commitment reduction notice,
Borrowing Notice, Conversion/Continuation Notice, and repayment notice received
by it hereunder. The Agent will notify each Lender of the interest rate
applicable to each Eurodollar Advance promptly upon determination of such
interest rate and will give each Lender prompt notice of each change in the
Alternate Base Rate. Each Reference Bank agrees to furnish timely information
for the purpose of determining the Eurodollar Rate.
2.15 Lending Installations. Each Lender may book its Loans at any
Lending Installation selected by such Lender and may change its Lending
Installation from time to time. All terms of this Agreement shall apply to any
such Lending Installation and the Notes shall be deemed held by each Lender for
the benefit of such Lending Installation. Each Lender may, by written or telex
notice to the Agent and the Borrower, designate a Lending Installation through
which Loans will be made by it and for whose account Loan payments are to be
made.
2.16 Non-Receipt of Funds by the Agent. Unless the Borrower notifies
the Agent prior to the date on which it is scheduled to make payment hereunder
to the Agent for the account of the Lenders, that it does not intend to make
such payment, the Agent may assume that such payment has been made. The Agent
may, but shall not be obligated to, make the amount of such payment available to
the intended recipient in reliance upon such assumption.
31
If the Borrower has not in fact made such payment to the Agent, the recipient of
such payment shall, on demand by the Agent, repay to the Agent the amount so
made available together with interest thereon in respect of each day during the
period commencing on the date such amount was so made available by the Agent
until the date the Agent recovers such amount at a rate per annum equal to the
interest rate applicable to the relevant Loan.
2.17 Withholding Tax Exemption. At least five Business Days prior to the
first date on which interest or fees are payable hereunder for the account of
any Lender, each Lender (or Lending Installation) that is not incorporated under
the laws of the United States of America, or a state thereof, agrees that it
will deliver to each of the Borrower and the Agent two duly completed copies of
United States Internal Revenue Service Form 1001 or 4224, certifying in either
case that such Lender (or Lending Installation) is entitled to receive payments
under this Agreement and the Notes without deduction or withholding of any
United States federal income taxes. Each Lender (or Lending Installation) which
so delivers a Form 1001 or 4224 further undertakes to deliver to each of the
Borrower and the Agent two additional copies of such form (or a successor form)
on or before the date that such form expires (currently, three successive
calendar years for Form 1001 and one calendar year for Form 4224) or becomes
obsolete or after the occurrence of any event requiring a change in the most
recent forms so delivered by it, and such amendments thereto or extensions or
renewals thereof as may be reasonably requested by the Borrower or the Agent, in
each case certifying that such Lender (or Lending Installation) is entitled to
receive payments under this Agreement and the Notes without deduction or
withholding of any United States federal income taxes, unless an event
(including without limitation any change in treaty, law or regulation) has
occurred prior to the date on which any such delivery would otherwise be
required which renders all such forms inapplicable or which would prevent such
Lender (or Lending Installation) from duly completing and delivering any such
form with respect to it and such Lender (or Lending Installation) advises the
Borrower and the Agent that it is not capable of receiving payments without any
deduction or withholding of United States federal income tax.
2.18 Maximum Interest Rate. Nothing contained in this Agreement or the
Notes shall require any Obligor to pay interest to any Lender at a rate
exceeding the maximum rate permitted by applicable law with respect to such
Lender. This Section 2.18 is not intended to limit the rate of interest payable
for the account of any Lender to the maximum rate permitted by the laws of any
state if a higher rate is permitted with respect to such Lender by supervening
provisions of U.S. federal law and it is specifically provided that Chapter 15
of Texas Revised Civil Statutes Article 5069 (the Texas Credit Code), which
regulates certain revolving loan accounts and revolving tri-party accounts,
shall not be applicable to this Agreement, the Notes or any of the Debt arising
hereunder. If the amount of interest payable for the account of any Lender on
any interest payment date in respect of the immediately preceding interest
computation period (together with any fees or charges which would constitute
interest under applicable law)
32
would exceed the maximum amount permitted by applicable law to be charged by
such Lender, the amount of interest payable for its account on such interest
payment date shall be automatically reduced to such maximum permissible amount.
If the amount of interest payable for the account of any Lender in respect of
any interest computation period is reduced pursuant to the third sentence of
this Section 2.18 and the amount of interest payable for its account in respect
of any subsequent interest computation period would be less than the maximum
amount permitted by applicable law to be charged by such Lender, then the amount
of interest payable for its account in respect of such subsequent interest
computation period shall be automatically increased to such maximum permissible
amount; provided that at no time shall the aggregate amount by which interest
paid for the account of any Lender has been increased pursuant to this sentence
exceed the aggregate amount by which interest paid for its account has
theretofore been reduced pursuant to the third sentence of this Section 2.18.
2.19 Agent's Fees. In order to compensate the Agent for the cost and
expense of acting as Agent under this Agreement, the Borrower hereby agrees to
pay to the Agent the fees agreed to between the Borrower and the Agent with
respect to its activities in structuring and administering this Agreement.
2.20 Procedures for Extensions of the Facility Maturity Date. The
Facility Maturity Date may be extended for successive 364 day periods if (A)
requested by the Borrower by prior written notice to the Agent not more than 120
days nor less than 90 days prior to the then Facility Maturity Date, and (B)
such extension is consented to in writing by each of the Lenders in the exercise
of its sole and absolute discretion within 45 days after receipt by the Lenders
of the relevant request for extension. Any extension of the Facility Maturity
Date hereunder shall become effective on the then Facility Maturity Date. Upon
the extension of such Facility Maturity Date, the Facility Maturity Date shall
be automatically extended by 364 days. Anything herein to the contrary
notwithstanding, no Lender shall have any obligation whatsoever to agree to any
extension of the Facility Maturity Date at any time, and failure by a Lender to
respond or to agree as herein provided to any such request for extension shall
be deemed an election not to extend the Facility Maturity Date then in effect
and such failure shall not create or give rise to a claim or action against the
Lenders or the Agent or any of them or be deemed as having the effect of
extending a Lender's Commitment hereunder.
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2.21 Procedures with respect to Increases in the Aggregate Commitment.
So long as no Default or Unmatured Default has occurred and is continuing, the
Borrower may request from time to time, and subject to the terms and conditions
hereinafter set forth, that the Aggregate Commitment be increased by giving
written notice thereof to the Agent; provided, however, that any such notice
must be given no later than 60 days prior to the then Facility Maturity Date.
Each such notice (a "Notice of Commitment Increase") shall (w) be in the form of
Exhibit "G", (x) attach a certificate from the Borrower certifying CUSA's
approval of any New Lender, (y) specify therein:
(i) the effective date of such increase, which date (the requested
"Commitment Increase Effective Date") shall be no earlier than five (5)
Business Days after receipt by the Agent of such notice;
(ii) the amount of the requested increase; provided, however, that
after giving effect to such requested increase, the Aggregate Commitment
shall not exceed $400,000,000;
(iii) the identity of the then Lenders, if any, which have agreed
with the Borrower to increase their respective Commitments in an amount
such that their respective Percentages after giving effect to such
requested increase will be the same or greater than their respective
Percentages prior to giving effect to such requested increase (each such
then Lender being a then "Increasing Lender"), each other Lender which has
agreed to increase its Commitment in an amount such that its Percentage
after giving effect to such a requested increase will be less than its
Percentage prior to giving effect to such requested increase (each such
Lender being a "Partially Increasing Lender"), the identity of each
financial institution not already a Lender, if any, which has agreed with
the Borrower to become a Lender to effect such requested increase in the
Aggregate Commitment (each such assignee shall be reasonably acceptable to
the Agent and approved as a Lender by CUSA; each such assignee being then a
"New Lender"), and each Lender which has not agreed to increase its
Commitment (each such Lender being a "Reducing Lender");
(iv) the amount of the respective Commitments and Percentages of the
then Lenders and any New Lenders from and after the Commitment Increase
Effective Date; and
(v) the Stated Amount of all outstanding Letters of Credit that
will be needed from each then Lender and the Stated Amount of each Letter
of Credit that will need to be
34
issued by any New Lenders on the Commitment Increase Effective Date as
calculated by the Borrower; and
(z) in the event any Lender's Percentage after giving effect to such a requested
increase will be different than its Percentage prior to giving effect to such
requested increase, attach a CUSA Certificate.
On or before each Commitment Increase Effective Date:
(i) the Borrower, each Increasing Lender, each Partially Increasing
Lender and each then New Lender shall execute and deliver to the Agent for
its acceptance, as to form, documentation embodying the provisions of the
Notice of Commitment Increase relating to the increase in the Aggregate
Commitment to be effected on such Commitment Increase Effective Date; and
(ii) upon acceptance of such documentation by the Agent, which
acceptance shall not be unreasonably withheld, and so long as no Default or
Unmatured Default has occurred and is continuing,
(A) the Agent shall give prompt notice of such acceptance to
each Lender,
(B) such documentation shall become effective, and the
Aggregate Commitment shall be increased to the amount specified
therein, on such Commitment Increase Effective Date,
(C) the Borrower shall execute and deliver to each New Lender a
Note payable to the order of such Lender in the face principal
amount equal to such Lenders' Commitment,
(D) the Borrower shall execute and deliver to each Increasing
Lender and each Partially Increasing Lender, against receipt by the
Borrower of such Lender's then existing Note, a new Note in the
face principal amount equal to such Lenders' Commitment after
giving effect to such Commitment increase,
(E) in the event an existing Lender's Percentage after giving
effect to such a requested increase will be different than its
Percentage prior to giving effect to such requested increase, each
such existing Lender shall either (i) issue a modification of its
outstanding Letters of Credit substantially in the form of Exhibit
"B-2", or (ii) issue a new Letter of Credit, in either case
reflecting a modification of the Stated Amount of such Lender's
outstanding Letters of
35
Credit equal to the product of (x) such Lender's Percentage after
giving effect to the increase in the Aggregate Commitment scheduled
for the Commitment Increase Effective Date, multiplied by (y) the
aggregate Stated Amount of all outstanding Letters of Credit, and
(F) each New Lender shall issue a new Letter of Credit in the
Stated Amount equal to the product of (x) such Lender's Percentage
after giving effect to the increase in the Aggregate Commitment
scheduled for the Commitment Increase Effective Date, multiplied by
(y) the aggregate Stated Amount of all outstanding Letters of
Credit.
On each Commitment Increase Effective Date:
(i) if there are any outstanding Advances or any unpaid
reimbursement obligations of the Borrower with respect to amounts drawn on
any Letters of Credit (which reimbursement obligations have not been deemed
to be automatic Base Rate Advances pursuant to Section 2.2.3), each then
New Lender and each then Increasing Lender shall, by wire transfer of
immediately available funds, deliver to the Agent such Lenders' New Funds
Amount for such Commitment Increase Effective Date, which amount, for each
such Lender, shall constitute Loans made by such Lender to the Borrower
pursuant to Section 2.1 on such Commitment Increase Effective Date;
(ii) promptly after the Agent's receipt thereof, the Agent shall, by
wire transfer of immediately available funds, pay to each then Reducing
Lender and to each Partially Increasing Lender its Reduction Amount for
such Commitment Increase Effective Date, which amount, for each such
Lender, shall constitute a prepayment by the Borrower pursuant to Section
2.6, ratably in accordance with the respective principal amounts thereof,
of the principal amounts of all then outstanding Loans of such Lender; and
(iii) Each Lender will immediately notify the Agent of the issuance
of each modification of Letter of Credit or issuance of a new Letter of
Credit pursuant to this Section and immediately provide a copy of each
modification or new Letter of Credit issued by such Lender to the Agent;
provided that the failure to so notify the Agent or so provide a copy to
the Agent shall not limit or impair the Borrower's Obligations hereunder,
including, without limitation, its Obligations to reimburse drawings under
or in respect of each modified Letter of Credit or each new Letter of
Credit.
Effective as of each Commitment Increase Effective Date, the Notes then or
theretofore delivered to each then New Lender, and the new Notes then or
theretofore delivered to each then Increasing Lender and each then Partially
Increasing Lender, shall evidence such Lender's
36
ownership of its Percentage, effective as of such Commitment Increase Effective
Date, of all Advances then outstanding and all unpaid reimbursement obligations
of the Borrower with respect to amounts drawn on any Letters of Credit. Also
effective as of each Commitment Increase Effective Date, each then New Lender
and each then Increasing Lender shall be deemed to have purchased and had
transferred to it, and each then Reducing Lender and each Partially Increasing
Lender shall be deemed to have sold and transferred to such New Lenders and
Increasing Lenders, such undivided interest in such Reducing Lender's and such
Partially Increasing Lender's interest in all then outstanding Obligations
hereunder and any security therefor and any guaranty pertaining thereto at any
time existing as is necessary so that such undivided interests of all Lenders
(including each then New Lender) shall accord with their respective Percentages
after giving effect to the increase in the Aggregate Commitment on such
Commitment Increase Effective Date.
ARTICLE III
CHANGE IN CIRCUMSTANCES
3.1 Yield Protection. If any change in, or introduction of, any law or
any governmental or quasi-governmental rule, regulation, policy, guideline or
directive (whether or not having the force of law), or any interpretation
thereof, or the compliance of any Lender therewith,
(i) subjects any Lender or any applicable Lending Installation to
any additional tax, duty, charge or withholding on or from payments due
from the Borrower (excluding federal taxation of the overall net income of
any Lender or applicable Lending Installation), or changes the basis of
taxation of payments to any Lender in respect of its Loans or Letters of
Credit or participations therein or other amounts due it hereunder, or
(ii) imposes or increases or deems applicable any reserve,
assessment, insurance charge, special deposit or similar requirement
against assets of, deposits with or for the account of, or credit extended
by, any Lender or any applicable Lending Installation (other than reserves
and assessments taken into account in determining the interest rate
applicable to Eurodollar Advances), or
(iii) imposes any other condition the direct result of which is to
increase the cost to any Lender or any applicable Lending Installation of
making, funding, maintaining or participating in the Loans or Letters of
Credit or reduces any amount receivable by any Lender or any applicable
Lending Installation in connection with the Loans or Letters of Credit, or
requires any Lender or any applicable Lending Installation
37
to make any payment calculated by reference to the amount of the Loans or
Letters of Credit held or interest received by it, by an amount deemed
material by such Lender,
then, within 15 days of demand by such Lender, the Borrower shall pay such
Lender that portion of such increased expense incurred or reduction in an amount
received which such Lender reasonably determines is attributable to making,
funding and maintaining its Loans, Letters of Credit, participations therein and
its Commitment. Any Lender claiming or reasonably anticipating any additional
amounts payable pursuant to Section 3.1(i) shall use reasonable efforts
(consistent with legal and regulatory restrictions) to file any certificate or
document requested by the Borrower or the Agent or to change the jurisdiction of
its applicable Lending Installation or issuing office or to contest any tax
imposed if the making of such a filing or change or contesting such tax would
avoid the need for or reduce the amount of any such additional amounts that may
thereafter accrue and would not be otherwise disadvantageous to such Lender in
its opinion. The Borrower shall not be obligated to compensate any Lender
pursuant to this Section 3.1 for any amounts attributable to a period more than
90 days prior to the giving of notice by such Lender to the Borrower of its
intention to seek compensation under this Section 3.1.
3.2 Changes in Capital Adequacy Regulations. If a Lender determines
that the amount of capital required or expected to be maintained by such Lender,
any Lending Installation of such Lender, or any corporation controlling such
Lender is increased as a result of a Change, then, within 15 days of demand by
such Lender, the Borrower shall pay such Lender the amount necessary to
compensate for any shortfall in the rate of return on the portion of such
increased capital which such Lender reasonably determines is attributable to
this Agreement, its Loans, its Letters of Credit or its obligation to make Loans
or issue Letters of Credit or participate in Letters of Credit hereunder (after
taking into account such Lender's policies as to capital adequacy being applied
with respect to customers similarly situated to Borrower with whom such Lender
has a contractual right to so charge such amounts). "Change" means (i) any
change after the date of this Agreement in the Risk-Based Capital Guidelines or
(ii) any adoption of or change in any other law, governmental or quasi-
governmental rule, regulation, policy, guideline, interpretation, or directive
(whether or not having the force of law) after the date of this Agreement which
affects the amount of capital required or expected to be maintained by any
Lender or any Lending Installation or issuing office or any corporation
controlling any Lender. "Risk-Based Capital Guidelines" means (i) the risk-
based capital guidelines in effect in the United States on the date of this
Agreement, including transition rules, and (ii) the corresponding capital
regulations promulgated by regulatory authorities outside the United States
implementing the July 1988 report of the Basle Committee on Banking Regulation
and Supervisory Practices Entitled "International Convergence of Capital
Measurements and Capital Standards," including transition rules, and any
amendments to such regulations adopted prior to the date of this Agreement. The
Borrower shall not be obligated to compensate any Lender pursuant to this
Section 3.2 for any amounts attributable to a period more than 90 days prior to
the giving of
38
notice by such Lender to the Borrower of its intention to seek compensation
under this Section 3.2.
3.3 Availability of Types of Advances. If any Lender determines that
maintenance of any of its Eurodollar Loans at a suitable Lending Installation
would violate any applicable law, rule, regulation or directive, whether or not
having the force of law, the Agent shall suspend the availability of Eurodollar
Advances and require any Eurodollar Advances to be converted into Base Rate
Advances. If the Required Lenders determine that (i) deposits of a type or
maturity appropriate to match fund Eurodollar Advances are not available, the
Agent shall suspend the availability of the Eurodollar Advances with respect to
any Eurodollar Advances made after the date of any such determination until such
time as deposits of a type or maturity appropriate to match fund Eurodollar
Advances are made available, or (ii) after giving effect to amounts payable
under Sections 3.1 and 3.2 an interest rate applicable to a Eurodollar Advance
does not accurately reflect the cost of making a Eurodollar Advance, then, if
for any reason whatsoever the provisions of Section 3.1 are inapplicable, the
Agent shall suspend the availability of Eurodollar Advances with respect to any
Eurodollar Advances made after the date of any such determination.
3.4 Funding Indemnification. If any payment of a Eurodollar Advance
occurs on a date which is not the last day of the applicable Eurodollar Interest
Period, whether because of acceleration, prepayment or otherwise, or any
Eurodollar Advance is converted to a Base Rate Advance on a date which is not
the last day of the applicable Eurodollar Interest Period or a Eurodollar
Advance is not made on the date specified by the Borrower for any reason other
than default by the Lenders, the Borrower will indemnify each Lender for any
loss or cost incurred by it directly resulting therefrom, including, without
limitation, any loss or cost in liquidating or employing deposits acquired to
fund or maintain the Eurodollar Advance.
3.5 Lender Statements; Survival of Indemnity. To the extent reasonably
possible, each Lender shall designate an alternate Lending Installation to
reduce any liability of the Borrower to such Lender under Sections 3.1 and 3.2
or to avoid the unavailability of a Eurodollar Advance under Section 3.3, so
long as such designation is not disadvantageous to such Lender in its opinion.
If any amount becomes due under Section 3.1, 3.2 or 3.4, each affected Lender
shall consult with the Borrower as to how it intends to calculate the amount due
and shall deliver a written statement of such Lender as to the amount due, if
any, under Section 3.1, 3.2 or 3.4. Such written statement shall set forth in
reasonable detail the basis for claiming such amount and calculations upon which
such Lender determined such amount and shall be final, conclusive and binding on
the Borrower in the absence of manifest error; provided that the determination
of such amount shall be made in good faith and in a manner consistent with such
Lender's standard practice and that such Lender's policies as to imposing such
increased costs are being applied with respect to customers similarly situated
to Borrower with whom such
39
Lender has a contractual right to so charge such amounts. Determination of
amounts payable under such Sections in connection with a Eurodollar Loan shall
be calculated as though each Lender funded its Eurodollar Loan through the
purchase of a deposit of the Type and maturity corresponding to the deposit used
as a reference in determining the Eurodollar Rate applicable to such Loan,
whether in fact that is the case or not. Unless otherwise provided herein, the
amount specified in the written statement shall be payable within ten (10)
Business Days after receipt by the Borrower of the written statement. The
obligations of the Borrower under Sections 3.1, 3.2 and 3.4 shall survive
payment of the Obligations and termination of this Agreement.
3.6 Replacement of Lenders. If any Lender is unable to make a
Eurodollar Loan pursuant to Section 3.3, is subject to increased costs pursuant
to Section 3.1, 3.2 or 3.4, fails to designate an alternate Lending Installation
pursuant to Section 3.1 or 3.5, or is owed or reasonably anticipates being owed
additional amounts pursuant to Section 3.1 and fails to take action to the
extent required under Subsection 3.1 to avoid or reduce any such additional
amounts, the Borrower shall have the right, if no Default then exists, to
replace such Lender with another financial institution reasonably acceptable to
the Agent provided that (i) such financial institution shall unconditionally
offer in writing (with a copy to the Agent) to purchase, in accordance with
Section 12.3.2 all of such Lender's rights and obligations under this Agreement
and the Notes, without recourse or expense to, or warranty by, such Lender being
replaced for a purchase price equal to the aggregate outstanding principal
amount of the Notes payable to such Lender plus such Lender's Percentage of any
outstanding reimbursement obligations with respect to any outstanding Letters of
Credit plus any accrued but unpaid interest on such Notes and such reimbursement
obligations plus accrued but unpaid fees in respect of such Lender's commitment
hereunder to the date of such purchase on a date therein specified, (ii) the
obligations of the Borrower owing pursuant to Section 3.1, 3.2 and 3.4 to the
Lender being replaced, shall be paid in full to the Lender being replaced
concurrently with such replacement, (iii) the replacement financial institution
shall execute a Notice of Assignment pursuant to which it shall become a party
hereto as provided in Section 12.3.2 and shall pay the processing fee required
pursuant to such section, and (iv) upon compliance with the provisions for
assignment provided in Section 12.3 and the payment of amounts referred to in
clause (i), the replacement financial institution shall constitute a "Lender"
hereunder and the Lender being so replaced shall no longer constitute a "Lender"
hereunder; provided that (x) if such Lender accepts such an offer and such
financial institution fails to purchase on such specified date in accordance
with the terms of such offer, the Borrower shall continue to be obligated to pay
the increased cost, amounts, expenses and taxes under Sections 3.1, 3.2, 3.4 and
3.5 above to such Lender and (y) if such Lender fails to accept such purchase
offer, the Borrower shall not be obligated to pay such Lender such increased
cost pursuant to such sections from and after the date of such purchase offer;
provided, further that notwithstanding the foregoing, no Lender which is an
issuer of an outstanding Letter of Credit may be replaced pursuant to this
Section 3.6 while such Letter of Credit is outstanding.
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ARTICLE IV
CONDITIONS PRECEDENT
4.1 Initial Advance and Letter of Credit. The Lenders shall not be
required to make the initial Advance hereunder and shall not be required to
issue the initial Letter of Credit unless the Borrower has furnished to the
Agent with sufficient copies for the Lenders:
(i) Copies of the articles of incorporation of each corporate
Obligor and each corporate partner of each Obligor and of the partnership
agreement of each Obligor or partner of an Obligor which is a partnership,
together with all amendments, and a certificate of good standing for each
corporate Obligor and each corporate partner of each Obligor, certified
with respect to each Obligor and each corporate partner of an Obligor by
the appropriate governmental officer in its jurisdiction of incorporation
or organization, as the case may be.
(ii) Copies, certified by the Secretary or Assistant Secretary of
each Obligor and each corporate partner of each Obligor, of its by-laws and
of its Board of Directors' resolutions (and resolutions of other bodies, if
any are deemed necessary by counsel for any Lender) authorizing the
execution of the Loan Documents to which it is a party.
(iii) An incumbency certificate, executed by the Secretary or
Assistant Secretary of each Obligor and each corporate partner of each
Obligor, which shall identify by name and title and bear the signature of
the officers of the Obligor or partner of the Obligor authorized to sign
the Loan Documents and to make borrowings and obtain Letters of Credit
hereunder, upon which certificate the Agent and the Lenders shall be
entitled to rely until informed of any change in writing by the Borrower.
(iv) A written opinion of (A) the General Counsel or Corporate
Counsel of the Borrower substantially in the form of Exhibit "C", each
dated the date of the initial Advance or Letter of Credit and addressed to
the Agent and the Lenders.
(v) Notes payable to the order of each of the Lenders.
(vi) Such related money transfer authorizations as the Agent may
have reasonably requested.
(vii) The Subsidiary Guaranties, duly executed on behalf of NGC, NGC
Liquids Marketing, Inc., NGC Oil Trading and Transportation, Inc., NGC
Futures, Inc.,
41
Hub Services, Inc., NGC Anadarko Gathering Systems, Inc., Trident Gas
Marketing, Inc., Trident NGL Pipeline Company, Kansas Gas Supply
Corporation, Trident Acquisition Corp., NGC UK Limited, NGC Canada, Inc.,
Trident and NGC Energy Resources, Limited Partnership, ▇▇▇▇▇▇ Petroleum
Company, Limited Partnership, WPC LP, Inc. and WTLPS, Inc.
(viii) A certificate setting forth the Borrower's insurance coverage
and insurers as of the Closing Date.
(ix) A copy of the fully executed Midstream Merger Agreement
certified by an officer of the Borrower as being true, correct and complete
together with a certificate of an officer of the Borrower to the effect
that the conditions of closing set forth in Article 12 thereof have been
satisfied.
(x) Such other documents as the Agent, any Lender or its counsel
may have reasonably requested.
4.2 Each Advance. The Lenders shall not be required to make any Advance
(other than an Advance that, after giving effect thereto and to the application
of the proceeds thereof, does not increase the aggregate amount of outstanding
Advances) and no Lender shall be obligated to issue a Letter of Credit, unless
on the applicable Borrowing Date or Issuance Date, as the case may be:
(i) There exists no Default or Unmatured Default.
(ii) The representations and warranties contained in Article V and
the representations in Sections 11 and 15 of each of the Subsidiary
Guaranties are true and correct in all material respects as of such
Borrowing Date or Issuance Date, as the case may be, except to the extent
any such representation or warranty is stated to relate solely to an
earlier date, in which case such representation or warranty shall be true
and correct on and as of such earlier date.
Each Borrowing Notice (other than a Borrowing Notice deemed given pursuant
to Section 2.2.3) with respect to each such Advance and each Issuance Request
with respect to a Letter of Credit shall constitute a representation and
warranty by the Borrower that the conditions contained in Sections 4.2(i) and
(ii) have been satisfied.
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ARTICLE V
REPRESENTATIONS AND WARRANTIES
The Borrower represents and warrants to the Lenders and the Agent that:
5.1 Corporate or Partnership Existence and Standing. Each of the
Borrower and its Subsidiaries is a corporation or partnership, as the case may
be, duly incorporated or organized, as the case may be, validly existing and in
good standing under the laws of its jurisdiction of incorporation or
organization and is in good standing and has all requisite authority to conduct
its business in each jurisdiction in which its business is conducted, except
where failure to have such authority would not have a Material Adverse Effect.
5.2 Authorization and Validity. Each Obligor has the corporate or
partnership power and authority to execute and deliver the Loan Documents to
which it is a party and to perform its obligations thereunder. Except to the
extent that the failure to so qualify would not have a Material Adverse Effect,
each of the Borrower and its Subsidiaries has all requisite power, and is in all
respects duly qualified and licensed under all applicable laws to own its assets
and properties as now owned and to carry on its business as now conducted. The
execution and delivery by each Obligor of the Loan Documents to which it is a
party and the performance of its obligations thereunder have been duly
authorized by proper corporate and partnership proceedings, and the Loan
Documents constitute legal, valid and binding obligations of each Obligor party
thereto, enforceable against such Obligor in accordance with their terms, except
as enforceability may be limited by bankruptcy, insolvency or similar laws
affecting the enforcement of creditors' rights generally.
5.3 No Conflict; Government Consent. Neither the execution and delivery
by the Obligors of the Loan Documents, nor the consummation of the transactions
therein contemplated, nor compliance with the provisions thereof will violate
any law, rule, regulation, order, writ, judgment, injunction, decree or award
binding on any Obligor or any of its Subsidiaries or any partner of any Obligor
or the Borrower's or any Subsidiary's or any partner's articles of
incorporation, by-laws or partnership agreement or the provisions of any
indenture, instrument or agreement to which the Borrower or any of its
Subsidiaries is a party or is subject, or by which it, or its Property, is
bound, or conflict with or constitute a default thereunder, or result in the
creation or imposition of any Lien in, of or on the Property of the Borrower or
any Subsidiary pursuant to the terms of any such indenture, instrument or
agreement that is a Material Agreement. No order, consent, approval, license,
authorization, or validation of, or filing, recording or registration with, or
exemption by, any governmental or public body or authority, or any subdivision
thereof, is required to authorize, or is required in
43
connection with the execution, delivery and performance of, or the legality,
validity, binding effect or enforceability of, any of the Loan Documents or, to
the extent that any such consent or other action may be required, it has been
validly procured and all waiting periods with respect thereto have expired.
5.4 Financial Statements. The March 31, 1996 consolidated financial
statements of Old NGC and its Subsidiaries heretofore delivered to the Lenders
were prepared in accordance with generally accepted accounting principles in
effect on the date such statements were prepared and fairly present the
consolidated financial condition and operations of Old NGC and its Subsidiaries
at such date and the consolidated results of their operations for the period
then ended.
5.5 Material Adverse Change. Since March 31, 1996, there has been no
change in the business, Property, financial condition or results of operations
of Old NGC and/or the Borrower and their respective Subsidiaries which could
reasonably be expected to have a Material Adverse Effect.
5.6 Taxes. The Borrower and its Subsidiaries have filed all United
States federal tax returns and all other tax returns or reports which are
required to be filed and have paid all taxes due pursuant to said returns or
pursuant to any assessment received by the Borrower or any of its Subsidiaries,
except such taxes, if any, as are being contested in good faith and as to which
adequate reserves have been provided. No tax liens have been filed and no
claims are being asserted with respect to any such taxes. The charges, accruals
and reserves on the books of the Borrower and its Subsidiaries in respect of any
taxes or other governmental charges are adequate in all material respects. The
Borrower knows of no pending investigation of the Borrower or any of its
Subsidiaries by any taxing authority, nor of any pending but unassessed tax
liability which could reasonably be expected to have a Material Adverse Effect.
5.7 Litigation and Contingent Obligations. Except as set forth on
Schedule "3" hereto, there is no litigation, arbitration, governmental
investigation, proceeding or inquiry pending or, to the knowledge of any of
their officers, threatened against or affecting the Borrower or any of its
Subsidiaries which could reasonably be expected to have a Material Adverse
Effect. Other than any liability incident to such litigation, arbitration or
proceedings, the Borrower has no material contingent obligations not provided
for or disclosed in the financial statements referred to in Section 5.4. To the
knowledge of the Borrower there are no outstanding judgments individually or in
the aggregate in excess of Twenty-Five Million Dollars ($25,000,000) (net of any
insurance coverage which is reasonably expected to be paid by the insurer) which
have not been stayed, against the Borrower, any of its Subsidiaries or any of
their respective Properties.
44
5.8 Subsidiaries. Schedule "1" hereto contains an accurate list of all
of the existing Subsidiaries of the Borrower on the Closing Date, setting forth
their respective jurisdictions of incorporation or organization and the
percentage of their respective capital stock or other equity owned by the
Borrower or other Subsidiaries of the Borrower. All of the issued and
outstanding shares of capital stock of such Subsidiaries which are corporations
have been duly authorized and issued and are fully paid and non-assessable.
5.9 ERISA. The Unfunded Liabilities of all Single Employer Plans do not
in the aggregate exceed $25,000,000. Neither the Borrower nor any other member
of the Controlled Group has incurred, or is reasonably expected to incur, any
withdrawal liability to Multiemployer Plans in excess of $25,000,000 in the
aggregate. Except for such matters as would not singly or in the aggregate have
or reasonably be expected to have a Material Adverse Effect, each Single
Employer Plan complies in all material respects with all applicable requirements
of law and regulations, no Reportable Event has occurred with respect to any
Single Employer Plan, except in connection with the Trident Merger, neither the
Borrower nor any other members of the Controlled Group has withdrawn from any
Multiemployer Plan with respect to which it has any unsatisfied liability or
initiated steps to do so, and except in connection with the Trident Merger, no
steps have been taken to reorganize or terminate any Single Employer Plan.
5.10 Accuracy of Information. All written factual information furnished
by the Borrower or any of its Subsidiaries on or after the Closing Date to the
Agent or any Lender for purposes of or in connection with this Agreement or any
transaction contemplated hereby will be, true and accurate in all material
respects (taken as a whole) on the date as of which such information is dated,
certified or delivered and will not be incomplete by omitting to state any
material fact necessary to make such information (taken as a whole) not
misleading at such time. In addition, any estimates or projections provided in
connection therewith will be based on information that is then currently
available and believed to be correct and on assumptions believed to be
reasonable, but the Borrower does not warrant that such estimates or projections
will ultimately prove to have been accurate.
5.11 Regulation U. Margin stock (as defined in Regulation U)
constitutes less than 25% of those assets of the Borrower and its Subsidiaries
which are subject to any limitation on sale, pledge, or other restriction
hereunder. The Borrower is not engaged principally, and does not as one of its
important activities engage, in the business of extending credit for the purpose
of purchasing or carrying margin stock (within the meaning of Regulations G, U,
or X of the Board of Governors of the Federal Reserve System), and no part of
the proceeds of any extension of credit under this Agreement will be used to
purchase or carry any such margin stock or to extend credit to others for the
purpose of purchasing or carrying any such margin stock. Neither the Borrower
nor any Person acting on its behalf has taken or will take any action which
45
could reasonably be expected to cause this Agreement or any of the Notes to
violate any of said Regulations G, U, or X, or any other regulation of the Board
of Governors of the Federal Reserve System or to violate the Securities Exchange
Act of 1934, in each case as now in effect or as the same may hereafter be in
effect.
5.12 Compliance With Laws. The Borrower and its Subsidiaries have
complied with all applicable statutes, rules, regulations, orders and
restrictions of any domestic or foreign government or any instrumentality or
agency thereof, having jurisdiction over the conduct of their respective
businesses or the ownership of their respective Property, except where the
failure to so comply would not have a Material Adverse Effect.
5.13 Environmental Matters. The Borrower, each of its Subsidiaries, and
their respective Properties are in compliance with all Environmental Laws except
where the failure to be in compliance could not reasonably be expected to have a
Material Adverse Effect and neither the Borrower nor any of its Subsidiaries is
subject to any liability or obligation for remedial action thereunder or in
connection therewith which could reasonably be expected to have a Material
Adverse Effect. There is no pending or, to the best of the Borrower's
knowledge, threatened investigation or inquiry by any Tribunal of the Borrower,
any of its Subsidiaries, or any of their respective Properties (i) pertaining to
any violation of any Environmental Law relating to Hazardous Materials, or (ii)
which could reasonably be expected to result in any requirement that the
Borrower or any of its Subsidiaries conduct any clean-up or remediation
activities with respect to any Hazardous Materials, which could reasonably be
expected to have a Material Adverse Effect. There are no Hazardous Materials
located on or under any of the Properties of the Borrower or any of its
Subsidiaries (other than petroleum products which are located thereon in the
ordinary course of business and in a manner which does not constitute a
violation of applicable Environmental Law) which could reasonably be expected to
have a Material Adverse Effect. Neither the Borrower nor any of its
Subsidiaries has caused or permitted any Hazardous Material to be disposed of on
or under or released from any of its properties which disposal or release could
reasonably be expected to have a Material Adverse Effect. Neither the Borrower
nor any of its Subsidiaries has any knowledge of any violation of any
Environmental Law by any previous owner of any of its properties that could
reasonably be expected to have a Material Adverse Effect.
5.14 Ownership of Properties; Liens. Except as set forth on Schedule
"2" hereto, on the date of this Agreement, the Borrower and its Subsidiaries
will have marketable title or valid leasehold interests, free of all Liens other
than those permitted by Section 6.2.8, to all of the Property and assets
reflected in the financial statements described in Section 5.4, except that with
respect to properties acquired subsequent to the date hereof, the Borrower
represents only that (i) the same will be acquired only after appropriate due
diligence regarding title to the same, and (ii) the title to all such property
so acquired will be acceptable to a reasonably prudent person
46
engaged in the acquisition, ownership and operation of the type of property
interest involved and subject only to defects existing as of the date of
acquisition which are not material or for which appropriate adjustments in the
cost of acquisition shall have been made.
5.15 Investment Company Act. Neither the Borrower nor any Subsidiary
thereof is an "investment company" or a company "controlled" by an "investment
company", within the meaning of the Investment Company Act of 1940, as amended.
5.16 Public Utility Holding Company Act. Other than Electric
Clearinghouse Inc. ("ECI"), neither the Borrower nor any Subsidiary is a
"holding company" or a "subsidiary company" of a "holding company", or an
"affiliate" of a "holding company" or of a "subsidiary company" of a "holding
company", within the meaning of the Public Utility Holding Company Act of 1935,
as amended ("PUHCA"), and the rules and regulations thereunder. Electric
Clearinghouse Inc. has received a "no action letter" from the Securities and
Exchange Commission (the "SEC Letter") which ensures that no enforcement action
will be brought against Electric Clearinghouse Inc. as an "electric utility", as
such term is defined in PUHCA, by virtue of the fact that Electric Clearinghouse
Inc. engages in power marketing activities.
5.17 Insurance. As of the Closing Date, the certificate provided
pursuant to Section 4.1(x) and signed by an Authorized Representative of the
Borrower, that attests to the existence and adequacy of, and summarizes, the
property and casualty insurance program carried by the Borrower and that has
been furnished by the Borrower to the Agent and the Lenders, is complete and
accurate in all material respects.
5.18 Solvency. (i) Immediately following the issuance of any Letter of
Credit, if any, issued pursuant hereto, (a) the value of the assets of the
Borrower and its Subsidiaries on a consolidated basis, at a fair valuation, will
exceed the debts and liabilities, subordinated, contingent or otherwise, of the
Borrower and its Subsidiaries on a consolidated basis; (b) the present fair
saleable value of the property of the Borrower and the Subsidiaries on a
consolidated basis will be greater than the amount that will be required to pay
the probable liability of the Borrower and its Subsidiaries on a consolidated
basis on their debts and other liabilities, subordinated, contingent or
otherwise, as such debts and other liabilities become absolute and matured; (c)
the Borrower and its Subsidiaries on a consolidated basis will be able to pay
their debts and liabilities, subordinated, contingent or otherwise, as such
debts and liabilities become absolute and matured; and (d) the Borrower and its
Subsidiaries on a consolidated basis will not have unreasonably small capital
with which to conduct the businesses in which they are engaged as such
businesses are now conducted and are proposed to be conducted after the date
hereof.
(ii) The Borrower does not intend to, or to permit any of its
Subsidiaries to, and does not believe that it or any of its Subsidiaries will,
incur debts beyond its ability to pay such
47
debts as they mature, taking into account the timing of and amounts of cash to
be received by it or any such Subsidiary and the timing of the amounts of cash
to be payable on or in respect of its Debt or the Debt of any such Subsidiary.
5.19 Default. Neither the Borrower nor any of its Subsidiaries is in
default under the provisions of any Material Agreement or of any instrument
evidencing any material obligation, indebtedness, or liability of the Borrower
or any of its Subsidiaries, or of any agreement relating thereto, or in default
under or in violation of any order, writ, injunction, decree, regulation, or
demand of any Tribunal, which default or violation could reasonably be expected
to have a Material Adverse Effect.
ARTICLE VI
COVENANTS
During the term of this Agreement, unless the Required Lenders shall
otherwise consent in writing:
6.1 Affirmative Covenants.
6.1.1 Financial Reporting. The Borrower will maintain, for itself and
each Subsidiary of the Borrower, a system of accounting established and
administered in accordance with generally accepted accounting principles, and
furnish to the Lenders:
(i) As soon as available, and in any event within sixty (60) days
after the end of each of the first three quarterly periods of each of its
fiscal years, (i) a consolidated statement of income of the Borrower and
its Subsidiaries for such quarter and a consolidated statement of income
and a consolidated statement of cash flows of the Borrower and its
Subsidiaries for the period commencing with the beginning of the Borrower's
fiscal year to the end of such quarter, (ii) a consolidated balance sheet
of the Borrower and its Subsidiaries as of the close of business for such
quarter, (iii) consolidating statements of income of the Borrower and its
Subsidiaries for such quarter and consolidating statements of income and
consolidating statements of cash flows of the Borrower and its Subsidiaries
for the period commencing with the beginning of the Borrower's fiscal year
to the end of such quarter prepared on a business segment basis, showing
gas, liquids, electric power and corporate, or such other segments as
agreed from time to time by the Agent, as business segments, (iv)
consolidating balance sheets of the Borrower and its Subsidiaries as of the
close of business for such quarter prepared on a business segment basis,
showing gas, liquids, electric power and corporate, or such other segments
as agreed from time to time by the Agent, as business segments, and (v)
48
a computation of the ratios and amounts required to be maintained by
Sections 6.3.1 and 6.3.2, all in reasonable detail, prepared in accordance
with generally accepted accounting principles and certified by an
Authorized Officer to the effect that they present fairly the financial
condition and results of the operations of the Borrower at the date and for
the period indicated therein, subject to changes resulting from year-end
audit adjustments.
(ii) As soon as available and in any event within 120 days after
the close of each of its fiscal years, an unqualified (except for
qualifications relating to changes in accounting principles or practices
reflecting changes in generally accepted principles of accounting and
required or approved by the Borrower's independent certified public
accountants) audit report certified by independent certified public
accountants, acceptable to the Agent, prepared in accordance with generally
accepted accounting principles on a consolidated basis for the Borrower and
its Subsidiaries, including a balance sheet as of the end of such period
and related statements of income, retained earnings and cash flows,
accompanied by a computation made by such accountants of the ratios and
amounts required to be maintained by Sections 6.3.1 and 6.3.2.
(iii) Together with the financial statements required hereunder, a
compliance certificate in substantially the form of Exhibit "D" hereto
signed by an Authorized Officer of the Borrower (a "Compliance
Certificate") certifying that the statements fairly present the Borrower's
financial condition and results of operations showing the calculations
necessary to determine compliance with this Agreement and stating that no
Default or Unmatured Default exists, or if any Default or Unmatured Default
exists, stating the nature and status thereof.
(iv) As soon as possible and in any event within 10 days after the
Borrower knows that any Reportable Event has occurred with respect to any
Single Employer Plan, a statement, signed by an Authorized Officer of the
Borrower, describing said Reportable Event and the action which the
Borrower proposes to take with respect thereto.
(v) Promptly after becoming aware thereof, written notice of any
litigation which could reasonably be expected to result in a judgment
against the Borrower or any of its Subsidiaries in excess of $25,000,000,
net of insurance coverage which is reasonably expected to be paid by the
insurer, or other event or condition which could reasonably be expected to
have a Material Adverse Effect.
(vi) Promptly upon the furnishing thereof to the shareholders of
the Borrower, copies of all financial statements, reports and proxy
statements so furnished.
49
(vii) Promptly upon the filing thereof, copies of all registration
statements and annual, quarterly, monthly or other regular reports which
the Borrower or any of its Subsidiaries files with the Securities and
Exchange Commission.
(viii) Promptly, notice in writing to the Lenders of the occurrence
of any Default or Unmatured Default.
(ix) Promptly, notice in writing to the Agent of any change in the
credit rating of the Borrower's senior unsecured Debt by a Rating Agency.
(x) Such other information (including non-financial information)
as the Agent or any Lender may from time to time reasonably request.
6.1.2 Use of Proceeds. The Borrower will use the proceeds of the
Advances to pay the reimbursement obligations of the Borrower with respect to
the Letters of Credit issued pursuant hereto or to continue or convert Advances
made previously. The Borrower will not, nor will it permit any Subsidiary of
the Borrower to, use any of the proceeds of the Advances to purchase or carry
any "margin stock" (as defined in Regulation U).
6.1.3 Additional Subsidiary Guaranties. The Borrower will cause any
Subsidiary of the Borrower (other than any Project Financing Subsidiary and
other than NGC Storage, Inc.) which after the date hereof has (i) consolidated
fixed assets plus net working capital with a book value equal to or greater than
$100,000,000 as determined in a manner consistent with the most recent financial
statements provided pursuant to Section 6.1.1 or (ii) 15% or more of the
Consolidated EBITD for the calendar quarter immediately prior to the quarter in
which such determination is made (unless such Consolidated EBITD for such
Subsidiary for such quarter is less than $10,000,000 or unless such Person is
not a Subsidiary of the Borrower for the entire calendar quarter) to become a
Guarantor with respect to, and be jointly and severally liable with all other
Guarantors for, all the Obligations by executing and delivering to the Lenders a
guaranty substantially in the form of the applicable Subsidiary Guaranty except
to the extent that such Person becomes a Subsidiary of the Borrower pursuant to
an Acquisition and is subject at the time of such Acquisition to restrictions
adversely affecting its ability to enter into a Subsidiary Guaranty; provided
however, that in the event that any Subsidiary of the Borrower provides a
Guaranty with respect to any Debt of the Borrower other than the Obligations,
such Subsidiary shall also concurrently become a Guarantor with respect to, and
be jointly and severally liable with all other Guarantors for, all the
Obligations by executing and delivering to the Lenders a guaranty substantially
in the form of the applicable Subsidiary Guaranty ("Additional Guaranty") and,
in the event that any such Subsidiary no longer provides a Guaranty with respect
to such other Debt of the Borrower, so long as such Additional Guaranty
50
is not otherwise required pursuant to this Section 6.1.3, the Additional
Guaranty shall concurrently terminate.
6.1.4 Conduct of Business. The Borrower will, and will cause each
Subsidiary of the Borrower to, carry on and conduct its business in
substantially the same manner and in substantially the same fields of enterprise
as it is presently conducted or contemplated and to do all things reasonably
necessary to remain duly incorporated, validly existing and in good standing as
a domestic corporation in its jurisdiction of incorporation or as a partnership
in its jurisdiction of organization, as the case may be, to maintain all
requisite authority to conduct its business in each jurisdiction in which its
business is conducted (except where the failure to do so could not reasonably be
expected to have a Material Adverse Effect) and to keep in full force and effect
its respective existence, rights, leases, patents, and all other licenses or
rights necessary to comply with all Laws or other provisions of any Material
Agreement (except where the failure to do so could not reasonably be expected to
have a Material Adverse Effect); provided, however, that nothing in this Section
6.1.4 shall prevent the abandonment and retirement of property used or useful in
the conduct of the business of the Borrower or any of its Subsidiaries, if, in
the reasonable opinion of the Borrower or the applicable Subsidiary of the
Borrower, such abandonment or retirement of property is in the interest of the
Borrower or such Subsidiary and not prejudicial to the Lenders.
6.1.5 Taxes and Other Charges. The Borrower will, and will cause each
Subsidiary of the Borrower to, pay when due all taxes, assessments and
governmental charges and levies upon it or its income, profits or Property, as
well as all lawful claims for labor, materials, and supplies, which, if unpaid
could become a Lien or charge on such Property, or any part thereof, except,
with regard to any of the foregoing, which are being contested in good faith by
appropriate proceedings diligently pursued and with respect to which adequate
reserves as required by Agreement Accounting Principles have been set aside.
6.1.6 Insurance. The Borrower will, and will cause each Subsidiary of
the Borrower to, maintain with financially sound and reputable insurance
companies insurance on their Property in such amounts and covering such risks as
is consistent with prudent industry practice, and the Borrower will furnish to
the Agent or any Lender upon reasonable request full information as to the
insurance carried, including, without limitation, certificates of insurers,
brokers and agents, as to such insurance.
6.1.7 Compliance with Laws. The Borrower will, and will cause each
Subsidiary of the Borrower to, comply with all laws, rules, regulations, orders,
writs, judgments, injunctions, decrees or awards to which it may be subject,
including, without limitation, all Environmental Laws, and obtain, keep, and
comply with, all necessary permits, approvals, certificates and
51
licenses in effect and remain in compliance therewith, except in any such case
where the failure to do so could not reasonably be expected to have a Material
Adverse Effect.
6.1.8 Maintenance of Properties. The Borrower will, and will cause each
Subsidiary of the Borrower to, maintain, preserve, protect and keep its Property
in good repair, working order and condition in accordance with prudent industry
practices, and make all necessary and proper repairs, renewals and replacements
so that its business is carried on in accordance with prudent industry
practices; provided, however, that nothing in this Section 6.1.8 shall prevent
the abandonment and retirement of property used or useful in the conduct of the
business of the Borrower or any of its Subsidiaries, if, in the reasonable
opinion of the Borrower or the applicable Subsidiary, such abandonment or
retirement of property is in the interest of the Borrower or such Subsidiary and
would not have a Material Adverse Effect.
6.1.9 Inspection. The Borrower will, and will cause each Subsidiary of
the Borrower to, permit the Agent and the Lenders, by their respective
representatives and agents, to visit and inspect (so long as no Default shall
have occurred, at their own risk, cost and expense) any of the Property,
corporate books and financial records of the Borrower and each Subsidiary of the
Borrower, to audit and examine and make copies of the books of accounts and
other financial records (and after the occurrence and during the continuance of
a Default, other records) of the Borrower and each Subsidiary of the Borrower,
and to discuss the affairs, finances and accounts of the Borrower and each
Subsidiary of the Borrower with, and to be advised as to the same by, their
respective officers upon reasonable advance notice, and at such reasonable times
(during normal business hours) and intervals as the Agent and the Lenders may
designate; provided, however, that during such time as no Default has occurred
and is continuing, visits, inspections and audits by the Agent and the Lenders
shall be conducted on the same date and not more often than once during any
calendar quarter, unless otherwise agreed by the Borrower.
6.1.10 Maintenance of Books and Records. The Borrower will maintain,
and will cause each of its Subsidiaries to maintain, proper books of record and
account in which the Borrower and each of its Subsidiaries will make full, true,
and correct entries, in accordance with Agreement Accounting Principles, of all
dealings and transactions with respect to which pursuant to any Law or Agreement
Accounting Principles the Borrower is required to maintain written records in
relation to its business and activities.
6.1.11 Compliance with ERISA. The Borrower will comply, and will cause
each of its Subsidiaries to comply, with all applicable minimum funding
requirements and all other applicable requirements of ERISA except where a
failure to do so could not reasonably be expected to have a Material Adverse
Effect.
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6.1.12 Maintenance of Credit Rating. The Borrower will use reasonable
efforts to maintain a credit rating by S&P or Moody's of its senior unsecured
Debt. In the event that S&P or ▇▇▇▇▇'▇ is not providing ratings of the
Borrower's senior unsecured Debt, the Agent may request that the Borrower
substitute another nationally recognized rating agency in lieu of S&P or
Moody's.
6.2 Negative Covenants.
6.2.1 [Intentionally Omitted]
6.2.2 Debt. The Borrower will not, nor will it permit any Subsidiary of
the Borrower to, create, incur or suffer to exist any Debt, except:
(i) The Obligations;
(ii) Debt existing on the date hereof (not otherwise permitted
pursuant to this Section 6.2.2) and included in the financial statements
referred to in Section 5.4 or in Schedule "2" hereto;
(iii) The Existing Trident Subordinated Debt;
(iv) Debt incurred under Capitalized Leases or secured by a
purchase money Lien permitted by Section 6.2.8(iv) provided that both before and
after giving effect to any incurrence of any such obligation or Debt there
exists no Default or Unmatured Default;
(v) Debt of (A) a Subsidiary of the Borrower due to the Borrower
or any other Subsidiary of the Borrower or (B) the Borrower due to any
Subsidiary of the Borrower;
(vi) To the extent not otherwise permitted by this Section 6.2.2,
Debt of Subsidiaries of the Borrower in an amount not to exceed in the aggregate
for all such Debt at any one time outstanding $150,000,000, provided, that both
before and after giving effect to any incurrence of such Debt there exists no
Default or Unmatured Default, provided further that no Subsidiary of the
Borrower shall enter into or permit to exist any agreement with respect to any
such Debt which restricts or prohibits, or which has the effect of restricting
or prohibiting the declaration or payment of dividends or other distributions or
advances by that Subsidiary to the Borrower and its other Subsidiaries;
53
(vii) Project Financing;
(viii) To the extent not otherwise permitted by this Section
6.2.2, Debt of the Borrower up to an amount such that both before and after the
incurrence of such Debt there will not exist a Default or an Unmatured Default;
(ix) Debt of any Person which is outstanding at the time such
Person becomes a Subsidiary of the Borrower as a result of a permitted
Acquisition;
(x) Debt incurred in connection with the Existing Bank Credit
Facility; and
(xi) Renewals, extensions, amendments, refinancing,
rearrangements, modifications, restatements, defeasances, purchases or
supplements of any Debt referred to in Subsection 6.2.2(i) through (x), provided
that no such renewal, extension, amendment, refinancing, rearrangement,
modification, restatement or supplement shall increase the amount of the
outstanding Existing Trident Subordinated Debt.
6.2.3 Merger. The Borrower will not, nor will it permit any Subsidiary of
the Borrower to, merge or consolidate with or into any other Person, unless both
before and after giving effect to such merger or consolidation, there exists no
Default or Unmatured Default; provided that (i) if any Subsidiary of the
Borrower party to such a merger or consolidation is a Guarantor, the Subsidiary
Guaranty of such Guarantor shall remain in force and effect and (ii) if the
Borrower is a party to such a merger or consolidation, the Borrower is the
surviving Person or if the Borrower is not the surviving Person, the surviving
Person shall expressly assume in writing in form and substance reasonably
satisfactory to the Agent all of the liabilities and obligations of the Borrower
hereunder, under the Notes and under the other Loan Documents.
6.2.4 Sale of Assets. The Borrower will not, nor will it permit any
Subsidiary of the Borrower to, lease, sell or otherwise dispose of its Property,
to any other Person except:
(i) sales of inventory, Natural Gas and other similar assets in the
ordinary course of business,
(ii) sales or other dispositions of notes receivable or accounts
receivable as permitted by Section 6.2.5,
(iii) leases, sales or other dispositions of its Property that,
together with all other Property of the Borrower and its Subsidiaries previously
leased, sold or disposed of (other than Property otherwise permitted to be sold,
leased, or otherwise disposed of pursuant to this Section 6.2.4) during the
twelve-month period ending with the month in
54
which any such lease, sale or other disposition occurs, do not constitute a
Substantial Portion of the Property of the Borrower and its Subsidiaries,
provided, that for purposes of this clause (iii), the sale or other disposition
by a Subsidiary of the Borrower of stock or other equity interests in itself to
a Person other than the Borrower or one or more of its Subsidiaries shall be
considered a sale or other disposition of Property with a value equal to the
difference between (A) the product of the Borrower's direct and indirect
percentage of ownership of such Subsidiary times the book value of such
Subsidiary before such sale or other disposition minus (B) the product of the
percentage of the Borrower's direct and indirect ownership of such Subsidiary
times the sum of the book value of such Subsidiary after giving effect to such
sale or other disposition plus any assets acquired in connection with such sale
or other disposition,
(iv) sales of assets which are concurrently leased back,
(v) sales or exchanges of fixed assets which are intended to be and
are replaced within 180 days of such sale or other disposition by fixed assets
having a substantially similar or greater fair market value,
(vi) dispositions of assets which are obsolete or no longer used or
useful in the business of the Borrower or any of its Subsidiaries,
(vii) leases, sales or other dispositions of its Property by (A) the
Borrower to any of its Subsidiaries or (B) any Subsidiary of the Borrower to the
Borrower or any other Subsidiary of the Borrower, or
(viii) sales or other dispositions of any ownership interest,
whether in whole or in part, in any fractionators within twelve (12) months of
the consummation of the Midstream Merger to comply with requirements of
governmental authorities in connection with the Midstream Merger;
provided that the parties understand and agree that any merger otherwise
permitted by Section 6.2.3 (including the Midstream Merger) shall not constitute
a disposition of assets.
6.2.5 Sale of Accounts. The Borrower will not, nor will it permit any
Subsidiary to, sell or otherwise dispose of any notes receivable or accounts
receivable, with or without recourse, with an aggregate outstanding principal
amount (in the case of notes) and an aggregate outstanding face amount (in the
case of accounts receivable) in excess, for all such sales and other
dispositions on or after the date hereof of $150,000,000 at any time and from
time to time outstanding.
55
6.2.6 Investments and Acquisitions. The Borrower will not, nor will it
permit any Subsidiary of the Borrower to, make or suffer to exist any
Investments, except:
(i) Short-term obligations of, or fully guaranteed by, the United
States of America.
(ii) Commercial paper rated A-l or better by S&P or P-l or better
by Moody's.
(iii) Certificates of deposit issued by and time deposits with
commercial banks (whether domestic or foreign) having capital and
surplus in excess of $100,000,000 or any Lender.
(iv) Other Investments (not otherwise permitted pursuant to this
Section 6.2.6) in existence on the date hereof and included in the financial
statements provided pursuant to Section 5.4 or in Schedule "1" hereto.
(v) Loans or advances to Trident pursuant to the Trident
Intercompany Credit Agreement.
(vi) Advances, loans, extensions of credit or capital contributions
by the Borrower or any of its Subsidiaries to or on behalf of the Borrower or
any Subsidiary or Affiliate of the Borrower (including, but not limited to, the
purchase of the Existing Trident Subordinated Debt), provided that both before
and after giving effect to any such advance, loan, extension of credit or
capital contribution, there exists no Default or Unmatured Default.
(vii) Contributions of capital to any Person, or investments in, or
purchases or other acquisitions (in accordance with Regulation U) of, the stock,
partnership interests, notes, debentures or other securities of any Person, or
any commitment for any of the foregoing.
(viii) Repurchase agreements with the Agent or any Lender, or banks
that are insured by the Federal Deposit Insurance Corporation and having a
capital and an unimpaired surplus of at least One Hundred Million Dollars
($100,000,000), and with members of the Association of Primary Dealers in United
States Government Securities, the underlying securities of which are of the type
described in (i) above, and each of which is secured at all times by obligations
of the same type that have fair market value, including accrued interest, at
least equal to the amount of such repurchase agreement, including accrued
interest.
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(ix) Obligations of any state within the United States of America,
any nonprofit corporation or any instrumentality of the foregoing, provided that
at the time of their purchase, such obligations are rated in one of the two
highest letter rating categories (e.g. in the case of S&P, either its AAA or AA
category) by a nationally recognized securities credit rating agency.
(x) Obligations issued by political subdivisions or municipalities
of any state within the United States of America, any nonprofit corporation or
any instrumentality of the foregoing, that are rated in one of the two highest
letter rating categories (e.g. in the case of S&P, either its AAA or AA
category) by a nationally recognized securities credit rating agency.
(xi) Eurodollar deposits with the overseas branch of any domestic
bank or any Lender having a capital and surplus of at least One Hundred Million
Dollars ($100,000,000) .
(xii) Participations having a term of no more than 90 days with (i)
any Lender or (ii) any financial institution, the unsecured debt of which is
rated in one of the two highest letter rating categories (e.g. in the case of
S&P, either its AAA or AA category) by a nationally recognized securities credit
rating agency, in loans made or owned by such Lender or other financial
institution to Persons which have open market commercial paper rated in either
of the two highest short-term rating categories by a nationally recognized
securities credit rating agency.
6.2.7 Contingent Obligations. The Borrower will not, nor will it permit any
Subsidiary of the Borrower to, make or suffer to exist any Guaranty, except:
(i) endorsement of instruments for deposit or collection in the
ordinary course of business,
(ii) the Subsidiary Guaranties,
(iii) Guaranties of the Existing Trident Subordinated Debt, which
Guaranties are subordinated to the Obligations in a manner satisfactory to the
Agent, acting reasonably,
(iv) to the extent not included elsewhere in this Section,
Guaranties of obligations in respect of letters of credit (other than Letters of
Credit) not to exceed in the aggregate at any time outstanding an amount equal
to the amount permitted under the
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Existing Credit Facility (whether or not such letters of credit are issued under
the Existing Credit Facility),
(v) the Trident Guaranties set forth in Schedule "4",
(vi) Guaranties of (A) Debt of the Borrower and its Subsidiaries
otherwise permitted pursuant to the terms of this Agreement and (B) other
obligations of the Borrower and its Subsidiaries (other than (1) Guaranties of
Debt of Persons other than the Borrower and its Subsidiaries, (2) Guaranties of
obligations set forth in agreements, undertakings or other arrangements by which
the Borrower and its Subsidiaries agree to maintain the net worth, working
capital or any other financial condition of any other Person, (3) Guaranties of
the type referred to in clause (a) of the definition of the term Guaranty and
not otherwise permitted by clause (iv) of this Section 6.2.7, and (4) completion
guaranties or similar assurances that a project performs as planned) of a type
normally incurred in the industry and incurred in the ordinary course of
business and
(vii) to the extent not included above, Guaranties of other
obligations (including, without limitation, agreements containing completion
guaranties or similar assurances that a project performs as planned and
excluding Guaranties of the type referred to in clause (a) of the definition of
Guaranty not otherwise permitted by clause (iv) of this Section 6.2.7) which
obligations are otherwise permitted pursuant to the terms of this Agreement not
to exceed in the aggregate $150,000,000 at any time.
6.2.8 Liens. The Borrower will not, nor will it permit any Subsidiary of
the Borrower to, create, incur, or suffer to exist any Lien in, of or on the
Property of the Borrower or any of its Subsidiaries, except:
(i) Utility easements, building restrictions and such other
encumbrances or charges against real property as are of a nature generally
existing with respect to properties of a similar character and which do not
materially affect the marketability of the same or interfere with the use
thereof in the business of the Borrower or its Subsidiaries;
(ii) Liens existing on the date hereof (not otherwise permitted
pursuant to this Section 6.2.8) and described in Schedule "2" hereto;
(iii) Permitted Liens;
(iv) Liens created by (a) Capitalized Leases permitted by Section
6.2.2(iv) provided that the Liens created by any such Capitalized Lease attach
only to the property
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leased to the Borrower or one of its Subsidiaries pursuant thereto, and
(b) purchase money Liens securing Debt (including such Liens securing Debt
incurred within 12 months of the date on which such Property was acquired)
permitted by Section 6.2.2 (iv) provided that all such Liens attach only to the
property purchased with the proceeds of the Debt secured thereby and (c) Liens
on receivables or notes created in connection with a receivables or notes sale
permitted by Section 6.2.5 and Liens on rights of the Borrower or any of its
Subsidiaries related to such receivables or notes which are transferred to the
purchaser of such receivables or notes in connection with such permitted sale,
provided that such Liens secure only the obligations of the Borrower or any of
its Subsidiaries in connection with such sale;
(v) Liens on cash and short-term investments (a) deposited by the
Borrower or any of its Subsidiaries in margin accounts with futures contract
brokers authorized to trade on the New York Mercantile Exchange to secure its
obligations with respect to futures contracts for the purchase or sale of
natural gas, natural gas liquids, domestic crude, ▇▇▇▇▇ crude, propane, heating
oil, unleaded gasoline and/or jet fuel or (b) pledged by the Borrower or any of
its Subsidiaries to secure its obligations pursuant to one or more Fixed Price
Contracts or other such contracts with respect to other commodities or interest
rate or currency rate management contracts;
(vi) Liens on (A) Property owned by a Project Financing Subsidiary
or (B) equity interests in a Project Financing Subsidiary (including in each
case a pledge of a partnership interest, common stock or a membership interest
in a limited liability company) securing Debt incurred in connection with a
Project Financing;
(vii) Liens on Property of a Person which exist at the time such
Person becomes a Subsidiary of the Borrower as a result of a permitted
Acquisition which Liens were not granted in contemplation of such Person
becoming a Subsidiary of the Borrower; and
(viii) extensions, renewals or replacements of any Lien referred to
in Sections 6.2.8(i) through (vii), provided that the principal amount of the
Debt or obligation secured thereby is not increased and that any such extension,
renewal or replacement Lien is limited to the Property originally encumbered
thereby.
6.2.9 [Intentionally Deleted]
6.2.10 Affiliates. The Borrower will not, and will not permit any
Subsidiary of the Borrower to, enter into any transaction (including, without
limitation, the purchase or sale of any Property or service) with, or make any
payment or transfer to, any Affiliate (other than the
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Borrower or any of its Subsidiaries and other than dividends to shareholders of
the Borrower) except upon terms no less favorable to the Borrower or such
Subsidiary than the Borrower or such Subsidiary would obtain in a comparable
arms-length transaction and except the transactions and payments contemplated in
and made pursuant to the Trident Merger Agreement and the Midstream Merger
Agreement together with, in each case, the other agreements attached as exhibits
thereto.
6.2.11 Judgments. The Borrower will not allow any final judgment for the
payment of money in excess of Twenty-Five Million Dollars ($25,000,000) with
respect to the Borrower or any Subsidiary of the Borrower (other than any
Project Financing Subsidiary) rendered against the Borrower or any Subsidiary of
the Borrower to remain undischarged or unbonded for a period of thirty (30) days
during which such execution shall not be effectively stayed or deferred.
6.3 Financial Covenants.
6.3.1 Net Worth. The Borrower will maintain at all times, Consolidated
Tangible Net Worth of not less than the sum of (i) $400 million, plus (ii) 50%
of each of the Borrower's Consolidated Net Income and Old NGC's Consolidated Net
Income, if positive, for each fiscal quarter ending after March 14, 1995, plus
(iii) 50% of the aggregate net proceeds of all issuances of equity securities
made by the Borrower after the Closing Date.
6.3.2 Leverage Ratio. The Borrower will not permit its Leverage Ratio to
exceed 60%.
ARTICLE VII
DEFAULTS
The occurrence of any one or more of the following events shall constitute a
Default:
7.1 Any representation or warranty made or deemed made by the Borrower or any
of its Subsidiaries to the Lenders or the Agent under or in connection with this
Agreement or any other Loan Document shall be incorrect in any material respect
on the date as of which made or deemed made.
7.2 The failure or refusal of any Obligor to (a) pay the principal of any of
the Obligations, or any part thereof, as it becomes due in accordance with the
terms of the Loan Documents, or (b) pay interest on any of the Obligations, or
any part thereof, or any other amount or fee under the terms of this Agreement
and the other Loan Documents, within five (5) Business Days after it becomes
due.
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7.3 The breach by the Borrower of any of the terms or provisions of Section
6.1.2, 6.1.9, 6.2.1, 6.2.2, 6.2.3, 6.2.4, 6.2.5, 6.2.7 or 6.2.8.
7.4 The breach by the Borrower (other than a breach which constitutes a
Default under Section 7.1, 7.2 or 7.3) of any of the terms or provisions of this
Agreement or any other Loan Document or by any Obligor of any other Loan
Document and, if capable of being remedied, such breach shall remain unremedied
for 45 days after the earlier of (i) an Authorized Officer of the Borrower
obtaining knowledge of such breach, or (ii) written notice thereof being given
to the Borrower by any Lender or the Agent.
7.5 (a) Failure of any Obligor or any Subsidiary (other than any Project
Financing Subsidiary) of an Obligor to pay when due (subject to any applicable
grace period), whether by acceleration or otherwise, any Debt (other than the
Obligations and other than the Existing Trident Subordinated Debt and other than
the CUSA Assumed Debt) aggregating for all of the Obligors and their respective
Subsidiaries in excess of $40,000,000 in principal amount; (b) the default by
any Obligor or any Subsidiary (other than any Project Financing Subsidiary) of
an Obligor in the performance of any term, provision or condition contained in
any agreement under which any Debt (other than the Obligations and other than
the Existing Trident Subordinated Debt and other than the CUSA Assumed Debt)
aggregating for all of the Obligors and their respective Subsidiaries (other
than any Project Financing Subsidiary) in excess of $40,000,000 in principal
amount was created or is governed, or any other event shall occur or condition
exist, the effect of which default or other event or condition is to permit the
holder or holders of such Debt to cause such Debt to become due prior to its
stated maturity and such default, event or condition continues for more than 30
days; provided, however, that in the event the rights of any holder or holders
of such Debt to accelerate such Debt have been terminated by cure of such
default or written waiver by the holder of such Debt, such default shall not
thereafter constitute a Default hereunder until such time as the right of such
holder or holders to accelerate such Debt again arises; (c) any Debt (other than
the Obligations and other than the Existing Trident Subordinated Debt and other
than the CUSA Assumed Debt) of any of the Obligors or any of their respective
Subsidiaries aggregating for all of the Obligors and their respective
Subsidiaries in excess of $40,000,000 in principal amount shall be declared to
be due and payable or required to be prepaid (other than by a regularly
scheduled payment) prior to the stated maturity thereof; (d) any of the Existing
Trident Subordinated Debt shall be declared to be due and payable or required to
be prepaid prior to the stated maturity thereof and shall not be paid (or such
acceleration rescinded) within 30 days of the date on which it is required to be
so paid; or (e) demand for payment shall be made for all or any part of the CUSA
Assumed Debt prior to the stated maturity thereof and such payment shall not be
made (or such demand rescinded) on or before the earlier of (i) 30 days
following such demand or (ii) the date upon which the holder thereof commences
proceedings to collect such payment.
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7.6 The Borrower or any of its Subsidiaries (other than any Project Financing
Subsidiary) or any Guarantor shall (i) have an order for relief entered with
respect to it under the Federal bankruptcy laws as now or hereafter in effect,
(ii) make an assignment for the benefit of creditors, (iii) apply for, seek,
consent to, or acquiesce in, the appointment of a receiver, custodian, trustee,
examiner, liquidator or similar official for it or any Substantial Portion of
its Property, (iv) institute any proceeding seeking an order for relief under
the Federal bankruptcy laws as now or hereafter in effect or seeking to
adjudicate it a bankrupt or insolvent, or seeking dissolution, winding up,
liquidation, reorganization, arrangement, adjustment or composition of it or its
debts under any law relating to bankruptcy, insolvency or reorganization or
relief of debtors or fail to file an answer or other pleading denying the
material allegations of any such proceeding filed against it, (v) take any
corporate action to authorize or effect any of the foregoing actions set forth
in this Section 7.6, (vi) not pay, or admit in writing its inability to pay, its
debts generally as they become due. or (vii) fail to contest in good faith any
appointment or proceeding described in Section 7.7.
7.7 Without the application, approval or consent of the Borrower or any of its
Subsidiaries (other than any Project Financing Subsidiary), or any Guarantor, a
receiver, trustee, examiner, liquidator or similar official shall be appointed
for the Borrower or such Subsidiary or such Guarantor or any Substantial Portion
of the Property of any of the foregoing, or a proceeding described in Section
7.6(iv) shall be instituted against the Borrower or any of its Subsidiaries
(other than any Project Financing Subsidiary) or any Guarantor and such
appointment continues undischarged or such proceeding continues undismissed or
unstayed for a period of 60 consecutive days.
7.8 The failure of the Borrower or any Subsidiary of the Borrower (other than
any Project Financing Subsidiary) to have stayed or discharged within a period
of thirty (30) days after the commencement thereof any attachment,
sequestration, or similar proceeding against any of its assets having a fair
market value of $25,000,000 or more.
7.9 Any Change in Control shall occur.
7.10 Any Subsidiary Guaranty shall fail to remain in full force or effect or
any action shall be taken to discontinue or to assert the invalidity or
unenforceability of any Subsidiary Guaranty, or any Guarantor shall fail to
comply with any of the terms or provisions of any Subsidiary Guaranty to which
it is a party, or any Guarantor denies that it has any further liability under
any Subsidiary Guaranty to which it is a party, or gives notice to such effect
provided, however, that no termination of a Subsidiary Guaranty resulting from
the merger of one Subsidiary of the Borrower which has executed a Subsidiary
Guaranty into another Subsidiary of the Borrower which has executed a Subsidiary
Guaranty shall constitute a Default
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so long as the Subsidiary Guaranty of the corporation surviving such merger
remains in full force and effect and that any release of an Additional Guaranty
pursuant to Section 6.1.3 shall not constitute a Default.
7.11 Subsidiaries. The Borrower shall cease to own, directly or indirectly,
free and clear of Liens, at least the following percentage (or such lesser
percentage of such Person as was owned at the time such Person reached either of
the thresholds described in (i)(A) or (i)(B) below, without giving effect to
transfers made in contemplation of such Person's reaching such threshold) of the
issued and outstanding capital stock or other equity of a Guarantor, other than
as a result of the merger of such Guarantor into another Subsidiary of the
Borrower or as a result of a transfer that did not result in a Default under
this Section 7.11 at the time made: (i) 80% of a Guarantor at any time either
(A) having fixed assets and net working capital with a book value equal to or
greater than $100,000,000 or (B) contributing 15% or more of the Consolidated
EBITD for an entire calendar quarter or (ii) 51% of any Guarantor other than a
Guarantor referred to in the foregoing clause (i); provided however, that any
-------- -------
release of an Additional Guaranty pursuant to Section 6.1.3 shall not constitute
a Default.
ARTICLE VIII
ACCELERATION, WAIVERS, AMENDMENTS AND REMEDIES
----------------------------------------------
8.1 Acceleration.
(a) If any Default described in Section 7.6 (other than 7.6 (ii) and other
than 7.6(v) hereof as to any of the matters in 7.6(ii) hereof) or 7.7 occurs,
(i) the obligations of the Lenders to make Loans hereunder and the obligations
of the Lenders to issue Letters of Credit shall automatically terminate and the
Obligations shall immediately become due and payable without presentment,
demand, protest or notice of any kind, all of which the Borrower hereby
expressly waives and without any election or action on the part of the Agent or
any Lender and (ii) the Borrower will be and become thereby unconditionally
obligated, without the need for demand or the necessity of any act or evidence,
to deliver to the Agent, at its address specified pursuant to Article XIII, for
deposit into the Letter of Credit Collateral Account, an amount (the "Collateral
Shortfall Amount") equal to the excess, if any, of
(A) 100% of the sum of the aggregate maximum amount remaining available
to be drawn under the Letters of Credit (assuming compliance with all conditions
for drawing thereunder) issued and outstanding as of such time, over
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(B) the amount on deposit in the Letter of Credit Collateral Account at
such time that is free and clear of all rights and claims of third parties and
that has not been applied by the Lenders against the Obligations;
provided, however, that so long as no Default shall have occurred and be
continuing, if the amount on deposit in the Letter of Credit Collateral Account
exceeds the Collateral Shortfall Amount, then the Agent shall return to the
Borrower an amount of such deposit equal to such excess, and the Lenders hereby
authorize the Agent to do so.
(b) If any Default occurs and is continuing (other than a Default described in
Section 7.6(i) or 7.6(iii) through (vii) or 7.7), (i) the Required Lenders may
terminate or suspend the obligations of the Lenders to make Loans and the
obligation of the Lenders to issue Letters of Credit hereunder, or declare the
Obligations to be due and payable, or both, whereupon the Obligations shall
become immediately due and payable, without presentment, demand, protest or
notice of any kind, all of which the Borrower hereby expressly waives and (ii)
the Required Lenders may, upon notice delivered to the Borrower and in addition
to the continuing right to demand payment of all amounts payable under this
Agreement, make demand on the Borrower to deliver (and the Borrower will,
forthwith upon demand by the Required Lenders and without necessity of further
act or evidence, be and become thereby unconditionally obligated to deliver), to
the Agent, at its address specified pursuant to Article XIII, for deposit into
the Letter of Credit Collateral Account an amount equal to the Collateral
Shortfall Amount.
(c) If at any time while any Default is continuing, the Agent determines that
the Collateral Shortfall Amount at such time is greater than zero, the Agent may
make demand on the Borrower to deliver (and the Borrower will, forthwith upon
demand by the Agent and without necessity of further act or evidence, be and
become thereby unconditionally obligated to deliver), to the Agent as additional
funds to be deposited and held in the Letter of Credit Collateral Account an
amount equal to such Collateral Shortfall Amount at such time.
(d) The Agent may at any time or from time to time after funds are deposited
in the Letter of Credit Collateral Account, apply such funds to the payment of
the Obligations and any other amounts as shall from time to time have become due
and payable by the Borrower to the Lenders under the Loan Documents.
(e) Neither the Borrower nor any Person claiming on behalf of or through the
Borrower shall have any right to withdraw any of the funds held in the Letter of
Credit Collateral Account. After all of the Obligations have been indefeasibly
paid in full, any funds remaining in the Letter of Credit Collateral Account
shall be returned by the Agent to the Borrower or paid to whoever may be legally
entitled thereto at such time.
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(f) The Agent shall exercise reasonable care in the custody and preservation
of any funds held in the Letter of Credit Collateral Account and shall be deemed
to have exercised such care if such funds are accorded treatment substantially
equivalent to that which the Agent accords its own property, it being understood
that the Agent shall not have any responsibility for taking any necessary steps
to preserve rights against any Persons with respect to any such funds.
8.2 Amendments. Subject to the provisions of this Article VIII, the Required
Lenders (or the Agent with the consent in writing of the Required Lenders) and
the Borrower may enter into agreements (including consents and waivers)
supplemental hereto for the purpose of adding or modifying any provisions to the
Loan Documents or changing in any manner the rights of the Lenders or the
Borrower hereunder or waiving any Default hereunder; provided, however, that no
such supplemental agreement shall, without the consent of each Lender affected
thereby:
(i) Extend the maturity of any Loan or Note or forgive all or any
portion of the principal amount thereof, or reduce the rate or extend the time
of payment of interest or fees thereon or any fees on any Letter of Credit.
(ii) Reduce the percentage specified in the definition of Required
Lenders.
(iii) Extend the Facility Maturity Date (including, without limitation,
as provided in Section 2.20), or reduce the amount of, or extend the payment
date for, the mandatory payments required under Section 2.3, or increase the
amount of the Commitment of any Lender hereunder, or permit the Borrower to
assign its rights under this Agreement or change the definition of Aggregate
Commitment (other than pursuant to Section 2.21).
(iv) Amend this Section 8.2.
(v) Release any Guarantor of any Obligation from its Subsidiary Guaranty
or release any Subsidiary Guaranty.
(vi) If a Default has occurred and is continuing, release any collateral
securing the Obligations.
(vii) Permit the Borrower to assign its rights or obligations under the
Loan Documents.
(viii) Amend the parenthetical phrase in the first sentence of the
definition of Eurodollar Interest Period.
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In addition, in the event of an amendment, modification or waiver of any
provision in the Existing Bank Credit Facility in accordance with the terms
thereof and the same or substantially similar provision exists in this
Agreement, then the Agent shall be deemed authorized to and will execute on
behalf of all of the Lenders a similar amendment, modification or waiver of this
Agreement without the consent or approval of the Lenders herein; provided,
however, that the consent of each Lender is required for any of the matters
described in clauses (i) through (vii) above and the consent of the Required
Lenders is required for any amendment, modification or waiver of Section 6.3.
No amendment of any provision of this Agreement relating to the Agent shall be
effective without the written consent of the Agent. The Agent may waive payment
of or modify the fee required under Section 12.3.2 without obtaining the consent
of any other party to this Agreement.
8.3 Preservation of Rights. No delay or omission of the Lenders or the Agent
to exercise any right under the Loan Documents shall impair such right or be
construed to be a waiver of any Default or an acquiescence therein, and the
making of a Loan notwithstanding the existence of a Default or the inability of
the Borrower to satisfy the conditions precedent to such Loan shall not
constitute any waiver or acquiescence. Any single or partial exercise of any
such right shall not preclude other or further exercise thereof or the exercise
of any other right, and no waiver, amendment or other variation of the terms,
conditions or provisions of the Loan Documents whatsoever shall be valid unless
in writing signed by the Lenders required pursuant to Section 8.2, and then only
to the extent specifically set forth in such writing. All remedies contained in
the Loan Documents or by law afforded shall be cumulative and all shall be
available to the Agent and the Lenders until the Obligations have been paid in
full and all Commitments have terminated.
ARTICLE IX
GENERAL PROVISIONS
------------------
9.1 Survival of Representations; Obligations. All representations and
warranties of the Borrower contained in this Agreement shall survive delivery of
the Notes and the making of the Loans and issuance of Letters of Credit herein
contemplated.
9.2 Governmental Regulation. Anything contained in this Agreement to the
contrary notwithstanding, no Lender shall be obligated to extend credit to the
Borrower in violation of any limitation or prohibition provided by any
applicable statute or regulation.
9.3 Taxes. Any taxes (excluding federal income taxes on the overall net
income of any Lender) or other similar assessments or charges made by any
governmental or revenue
66
authority in respect of the Loan Documents shall be paid by the Borrower,
together with interest and penalties, if any.
9.4 Headings. Section headings in the Loan Documents are for convenience of
reference only, and shall not govern the interpretation of any of the provisions
of the Loan Documents.
9.5 Entire Agreement. The Loan Documents embody the entire agreement and
understanding among the Borrower, the Agent, and the Lenders and supersede all
prior agreements and understandings among the Borrower, the Agent, and the
Lenders relating to the subject matter thereof.
9.6 Several Obligations; Benefits of this Agreement. The respective
obligations of the Lenders hereunder are several and not joint and no Lender
shall be the partner or agent of any other (except to the extent to which the
Agent is authorized to act as such). The failure of any Lender to perform any
of its obligations hereunder shall not relieve any other Lender from any of its
obligations hereunder. This Agreement shall not be construed so as to confer
any right or benefit upon any Person other than the parties to this Agreement
and their respective permitted successors and assigns.
9.7 Expenses; Indemnification of Agent and Lenders. The Borrower shall
reimburse the Agent for any reasonable costs, internal charges and out-of-pocket
expenses (including reasonable attorneys' fees and time charges of attorneys for
the Agent, which attorneys may be employees of the Agent) paid or incurred by
the Agent in connection with the preparation, negotiation, execution, delivery,
review, amendment, modification, and administra tion of the Loan Documents. The
Borrower also agrees to reimburse the Agent and the Lenders for any reasonable
costs, internal charges and out-of-pocket expenses (including reasonable
attorneys' fees and time charges of attorneys for the Agent and the Lenders,
which attorneys may be employees of the Agent or the Lenders) paid or incurred
by the Agent or any Lender in connection with the collection and enforcement of
the Loan Documents. Neither the Agent, any Lender nor any of their respective
officers, directors, employees, or agents (each, an "Indemnified Party") shall
be liable for any action in good faith taken or omitted to be taken by such
Indemnified Party pursuant to, in connection with, or in any way related to this
Agreement or any other Loan Document including, without limitation, an
Indemnified Party's own negligence or co-negligence except to the extent such
action or omission constitutes willful misconduct or gross negligence on the
part of such Indemnified Party (or its officers, directors, employees or
authorized agents) or is adjudicated by a court of competent jurisdiction to
constitute gross negligence or willful misconduct on the part of such
Indemnified Party (or its officers, directors, employees or authorized agents).
The Borrower agrees to the fullest extent permitted by applicable Law, to
indemnify and to hold harmless each Indemnified Party from
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and against any and all losses, claims, damages, penalties, judgments, expenses
and liabilities to Persons not party to this Agreement including all actions
with respect thereto (including, without limitation, any alleged violations of
applicable federal or state securities laws committed by any Person other than
such Indemnified Party or any such loss resulting from such Indemnified Party's
negligence), and reasonable attorneys' fees and costs (including, without
limitation, all expenses of litigation and preparation therefor) which any of
them may pay or incur arising out of or in connection with this Agreement, the
other Loan Documents and the transactions contemplated hereby and thereby or the
direct or indirect application of the proceeds of any Loan or Letter of Credit,
or the performance by such Indemnified Party of its obligations hereunder and
under the other Loan Documents; provided, however, that the indemnification
provided for herein shall not apply to any such loss (i) adjudicated by a court
of competent jurisdiction to have resulted from the willful misconduct or gross
negligence of such Indemnified Party, (ii) arising out of any claim made by any
Lender against the Agent or another Lender under this Agreement or the other
Loan Documents, or (iii) arising out of any claim made by any Participant
against a Lender which does not result from a breach by any Obligor of any term
or provision of this Agreement or any other Loan Document. The obligations of
the Borrower under this Section shall survive the termination of this Agreement.
9.8 Numbers of Documents. All statements, notices, closing documents, and
requests hereunder shall be furnished to the Agent with sufficient counterparts
so that the Agent may furnish one to each of the Lenders.
9.9 Severability of Provisions. Any provision in any Loan Document that is
held to be inoperative, unenforceable, or invalid in any jurisdiction shall, as
to that jurisdiction, be inoperative, unenforceable, or invalid without
affecting the remaining provisions in that jurisdiction or the operation,
enforceability, or validity of that provision in any other jurisdiction, and to
this end the provisions of all Loan Documents are declared to be severable.
9.10 Nonliability of Lenders. The relationship between the Borrower and
the Lenders and the Agent shall be solely that of borrower and lender. Neither
the Agent, nor any Lender shall have any fiduciary responsibilities to the
Borrower. Neither the Agent, nor any Lender undertakes any responsibility to
the Borrower to review or inform the Borrower of any matter in connection with
any phase of the Borrower's business or operations.
9.11 CHOICE OF LAW. THE LOAN DOCUMENTS (OTHER THAN THOSE CONTAINING A
CONTRARY EXPRESS CHOICE OF LAW PROVISION) SHALL BE CONSTRUED IN ACCORDANCE WITH
THE INTERNAL LAWS (AND NOT THE LAW OF CONFLICTS OF LAWS) OF THE STATE OF
ILLINOIS, BUT GIVING EFFECT TO FEDERAL LAWS APPLICABLE TO NATIONAL BANKS.
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9.12 CONSENT TO JURISDICTION. THE BORROWER HEREBY IRREVOCABLY SUBMITS TO
THE NON-EXCLUSIVE JURISDICTION OF ANY UNITED STATES FEDERAL OR ILLINOIS STATE
COURT SITTING IN CHICAGO IN ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING
TO ANY LOAN DOCUMENTS AND THE BORROWER HEREBY IRREVOCABLY AGREES THAT ALL CLAIMS
IN RESPECT OF SUCH ACTION OR PROCEEDING MAY BE HEARD AND DETERMINED IN ANY SUCH
COURT AND IRREVOCABLY WAIVES ANY OBJECTION IT MAY NOW OR HEREAFTER HAVE AS TO
THE VENUE OF ANY SUCH SUIT, ACTION OR PROCEEDING BROUGHT IN SUCH A COURT OR THAT
SUCH COURT IS AN INCONVENIENT FORUM. NOTHING HEREIN SHALL LIMIT THE RIGHT OF
THE AGENT OR ANY LENDER TO BRING PROCEEDINGS AGAINST THE BORROWER IN THE COURTS
OF ANY OTHER JURISDICTION.
9.13 WAIVER OF JURY TRIAL. THE BORROWER, THE AGENT, AND EACH LENDER HEREBY
WAIVE TRIAL BY JURY IN ANY JUDICIAL PROCEEDING INVOLVING, DIRECTLY OR
INDIRECTLY, ANY MATTER (WHETHER SOUNDING IN TORT, CONTRACT OR OTHERWISE) IN ANY
WAY ARISING OUT OF, RELATED TO, OR CONNECTED WITH ANY LOAN DOCUMENT OR THE
RELATIONSHIP ESTABLISHED THEREUNDER.
9.14 Confidential Information. The Agent and each Lender agree that all
documentation and other information made available by the Borrower to the Agent
or such Lender under the terms of this Agreement shall (except to the extent
such documentation or other information is publicly available or hereafter
becomes publicly available other than by action of the Agent or such Lender, or
was theretofore known or hereinafter becomes known to the Agent or such Lender
on a nonconfidential basis independent of any disclosure thereto by the
Borrower) be held in confidence by the Agent or such Lender in accordance with
prudent banking procedures and used solely in the administration and enforcement
of the Loan Documents and Letters of Credit from time to time outstanding and in
the prosecution or defense of legal proceedings arising in connection herewith;
provided that (i) the Agent or such Lender may disclose documentation and
information to the Agent and/or to any other Lender which is a party to this
Agreement or any Affiliates thereof and (ii) the Agent or such Lender may
disclose such documentation or other information to any other bank or other
Person to which such Lender sells or proposes to make an assignment or sell a
participation in its Loans hereunder if such other bank or Person, prior to such
disclosure, agrees in writing to be bound by the terms of the confidentiality
statement customarily employed by the Agent or such Lender in connection with
such potential transfers provided that the terms of such confidentiality
statement are no less restrictive than those contained in the confidentiality
agreement executed by the Borrower and the Agent or such Lender.
Notwithstanding the foregoing, nothing contained herein shall be construed to
prevent the Agent or any Lender from (a) making disclosure of any information
69
(i) if required to do so by applicable law or regulation, (ii) to any
governmental agency or regulatory body having or claiming to have authority to
regulate or oversee any aspect of the Agent's or Lender's business or that of
the Agent's or Lender's corporate parent or affiliates in connection with the
exercise of such authority or claimed authority, (iii) pursuant to any subpoena
or if otherwise compelled in connection with any litigation or administrative
proceeding, (iv) to correct any false or misleading information which may become
public concerning such Person's relationship to the Borrower, or (v) to the
extent the Agent or such Lender or its counsel deems necessary or appropriate to
enforce any remedy provided in the Loan Documents, the Notes or this Agreement
or otherwise available by law; or (b) making, on a confidential basis, such
disclosures as such Lender reasonably deems necessary or appropriate to its
legal counsel or accountants (including outside auditors). If the Agent or such
Lender is compelled to disclose such confidential information in a proceeding
requesting such disclosure, the Agent or such Lender shall seek to obtain
assurance that such confidential treatment will be accorded such information;
provided, however, the Agent or such Lender shall have no liability for the
failure to obtain such treatment. Notwithstanding anything in this Agreement to
the contrary, each Lender agrees that to the extent it acquires information from
or on behalf of the Borrower or any of its Subsidiaries that may provide a
competitive advantage with regard to the sale or purchase of commodities or
derivative products, such Lender will take all reasonable care to keep such
information confidential as to the officers, agents or employees of such Lender
or any Affiliate thereof that are involved in such Lender's or Affiliate's
commodity trading activities.
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ARTICLE X
THE AGENT
---------
10.1 Appointment and Authority of Agent. In order to expedite the various
transactions contemplated by this Agreement, each Lender hereby designates and
appoints CIBC to act as its agent hereunder, and authorizes CIBC to take such
action on its behalf under the provisions of this Agreement and to exercise such
powers and perform such duties as are expressly delegated to the Agent by the
terms of this Agreement or any other Loan Document, together with such other
powers as are reasonably incidental thereto. Notwithstanding any provision to
the contrary elsewhere in this Agreement or any other Loan Document, the Agent
shall not have any duties or responsibilities, except those expressly set forth
herein or therein, or any fiduciary relationship with any Lender or any Obligor,
and no implied covenants, functions, responsibilities, duties, obligations, or
liabilities shall be read into this Agreement or any other Loan Document or
otherwise exist against the Agent. Should the Agent fail or refuse to take any
action requested hereunder by the Required Lenders, the Agent shall resign and
the Required Lenders shall promptly appoint a successor to the Agent hereunder.
At any time that no Person or Persons are acting as agent hereunder, the
Obligors are authorized to deal directly with each Lender for all purposes
hereunder including, without limitation, the remittances of amounts then
required to be paid hereunder and, in respect to any request or the like
purportedly delivered by the Required Lenders to the Obligors, the Obligors
shall receive written evidence thereof. The Agent is hereby expressly
authorized as agent on behalf of the Lenders, without hereby limiting any
implied authority:
(a) To receive on behalf of each Lender any payment of principal or interest
on the Advances paid to the Agent, and to promptly distribute to each Lender its
pro rata share of all payments so received;
(b) To receive all documents and items to be furnished hereunder;
(c) To act as nominee for and on behalf of all of the Lenders in and under
this Agreement and the other Loan Documents;
(d) To arrange for the means whereby the funds of the Lenders are to be made
available to the Borrower;
(e) To distribute to the Lenders information, requests, payments, prepayments,
documents, and other items received from the Obligors and others;
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(f) To execute and deliver to the Obligors and others requests, demands,
approvals, and consents received from the Lenders;
(g) To the extent permitted by this Agreement, to exercise on behalf of each
Lender all remedies of the Lenders or the Agent upon the occurrence of any
Default or Unmatured Default specified in this Agreement, to the extent
requested by the Required Lenders; and
(h) To take such other actions as may be requested by the Required Lenders,
subject to the limitations of Section 8.2.
10.2 Capacity of the Agent. With respect to its commitment to lend
hereunder and the Loans made by it and Letters of Credit issued by it, the Agent
in its capacity as a Lender and not as the Agent, shall have the same rights and
powers hereunder as the other Lenders and may exercise the same rights and power
as though it were not the Agent.
10.3 No Liability of the Agent and Indemnity. Neither the Agent, nor any
of it officers, directors, employees, agents, attorneys-in-fact or Affiliates
shall be (i) liable for any action taken or omitted to be taken by it or them
hereunder or otherwise in connection with the Loan Documents (except for its or
such Person's own willful misconduct or gross negligence in not performing a
specific administrative duty hereunder), or (ii) responsible in any manner to
any Lender for any recitals, statements, representations, or warranties made by
any Obligor or any officer thereof contained in any Loan Document or in any
certificate, report, statement, or other document referred to or provided for
in, or received by the Agent under or in connection with, any Loan Document or
for the value, validity, effectiveness, genuineness, enforceability, or
sufficiency of any Loan Document or for any failure of any Obligor to perform
its obligations under any Loan Document. The Agent 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 or conditions contained in any Loan
Document, or to inspect the properties, books, or records of any Obligor. To
the extent that the Agent is not reimbursed or indemnified by the Obligors, each
of the Lenders will indemnify the Agent to the fullest extent permitted by
applicable Law pro rata based upon their respective Percentages from and against
any and all demands, liabilities, obligations, losses, damages, penalties,
actions, judgments, suits, costs, expenses, or disbursements of any kind
whatsoever which may at any time be imposed on, incurred by, or asserted against
the Agent in any way relating to or arising out of this or any other Loan
Document, 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 the Agent under or in connection with any of the foregoing, including
resulting from the Agent's own negligence (and including, without limitation,
any liabilities, obligations, losses, damages, penalties, actions, judgments,
suits, costs, expenses, or disbursements resulting from any violations or
alleged violation of applicable federal or state securities laws, committed by
any Person other than the
72
Agent) but not gross negligence or willful misconduct. The agreements in this
Section 10.3. shall survive the termination of this Agreement.
10.4 Employees of Agent. The Agent may execute any and all duties
hereunder by or through agents or employees and shall be entitled to advice of
counsel pertaining to all matters hereunder. The Borrower has agreed to
reimburse the Agent for actual out-of-pocket expenses incurred by the Agent and
its agents in acting under this Agreement and each other Loan Document and to
pay any reasonable legal and out-of-pocket expenses incurred by the Agent in
connection with the development, preparation, negotiation, and execution of the
Loan Documents, or the enforcement of the rights of the Agent and the Lenders
thereunder. Each Lender agrees to reimburse the Agent, when applicable, in the
amount of its pro rata share based upon its Percentage of any out-of-pocket
expenses incurred for the benefit of the Lenders and not reimbursed by the
Obligors.
10.5 Reliance. The Agent shall be entitled to rely on any conversation,
notice, consent, certificate, schedule, affidavit, letter, telegram, teletype
message, statement, order, or other document believed to be genuine and correct
and to have been signed or sent by the proper Person or Persons and, in respect
of legal matters, upon an opinion of counsel selected by the Agent. The Agent
and the Obligors may deem and treat the original Lenders hereunder as the owners
of their respective pro rata shares of the Obligations for all purposes hereof
notwithstanding any assignment or transfer of any interest therein by any Lender
in accordance with the provisions of Article XII. Any request, authority, or
consent of any holder of any of the Notes shall be conclusive and binding on any
subsequent holder, transferee, or assignee of such Note. The Agent shall be
fully justified in failing or refusing to take any action hereunder or under any
other Loan Document unless it shall first receive such advice or concurrence of
the Required Lenders as it deems appropriate or it shall first be indemnified to
its satisfaction by the Lenders against any and all liability and expense which
may be incurred by it by reason of taking or continuing to take any such action.
The Agent shall in all cases be fully protected in acting, or in refraining from
acting, hereunder or under any other Loan Document in accordance with a request
of the Required Lenders, or of all of the Lenders in the circumstances required
by Section 8.2, and such request and any action taken or failure to act pursuant
thereto shall be binding upon all of the Lenders and their successors and
assigns. Each Lender expressly acknowledges that neither the Agent, nor any of
its officers, directors, employees, agents, attorneys-in-fact or Affiliates has
made any representations or warranties to it and that no act by the Agent
hereinafter taken shall be deemed to constitute any representation or warranty
by the Agent to any Lender. Except for notices, reports and other documents
expressly required to be furnished to the Lenders by the Agent hereunder, the
Agent shall not have any duty or responsibility to provide any Lender with any
credit or other information concerning the business, operations, property,
financial and other condition or creditworthiness of any Obligor
73
or any of its Subsidiaries which may come into the possession of the Agent or
any of its officers, directors, employees, agents, attorneys-in-fact or
Affiliates.
10.6 Several Commitments. Except as expressly provided in this Section
10.6, the obligations of the Lenders under this Agreement are several. The
default by any Lender in making its Loan in accordance with its commitment
hereunder, issuing its Letters of Credit or performing on its Letters of Credit
shall not relieve the other Lenders of their obligations hereunder. In the
event of any default by any Lender in issuing its Letters of Credit, a non-
defaulting Lender shall be obligated to issue its Percentage of the amount
requested in each Issuance Request, but shall not be obligated to issue the
amount which the defaulting Lender was required to advance hereunder. Nothing
in this Section 10.6 shall be construed as releasing, modifying, or waiving the
obligation of each Lender to issue its Percentage of the Letters of Credit
sought in each Issuance Request pursuant to the terms of this Section 10.6 and
this Agreement.
10.7 Notice of Default. The Agent shall not be deemed to have knowledge or
notice of the occurrence of any Default or Unmatured Default unless the Agent
has received notice from a Lender or an Obligor referring to this Agreement or
other relevant Loan Document, describing such Default or Unmatured Default and
stating that such notice is a "notice of default." Notwithstanding the
provisions of the immediately preceding sentence, in the event that the Agent or
any Lender knows of any Default or Unmatured Default such Person shall, as soon
as practicable, give notice of same to each other Lender. In the event that the
Agent receives such a notice, the Agent shall give notice thereof to the
Lenders. The Agent shall take such action with respect to such Default or
Unmatured Default as shall be reasonably directed by the Required Lenders;
provided that, unless and until the Agent shall have received such directions,
the Agent may (but shall not be obligated to) take such action, or refrain from
taking such action (unless directions from the Required Lenders are required
therefore under Article VIII), with respect to such Default or Unmatured Default
as it shall deem advisable in the best interests of the Lenders.
10.8 Lender Credit Decision. Each Lender acknowledges that it has,
independently and without reliance upon the Agent or any other Lender and based
on the financial statements prepared by the Borrower and such other documents
and information as it has deemed appropriate, made its own credit analysis and
decision to enter into this Agreement and the other Loan Documents. Each Lender
also acknowledges that it will, independently and without reliance upon the
Agent 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 decisions in
taking or not taking action under this Agreement and the other Loan Documents.
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10.9 Successor Agent. The Agent may resign at any time by giving written
notice thereof to the Lenders and the Borrower, such resignation to be effective
upon the appointment of a successor Agent or, if no successor Agent has been
appointed, forty-five days after the retiring Agent gives notice of its
intention to resign. Upon any such resignation, the Required Lenders shall have
the right to appoint with the consent of the Borrower which such consent shall
not be unreasonably withheld or delayed, on behalf of the Borrower and the
Lenders, a successor Agent. If no successor Agent shall have been so appointed
by the Required Lenders within thirty days after the resigning Agent's giving
notice of its intention to resign, then the resigning Agent may appoint with the
consent of the Borrower which such consent shall not be unreasonably withheld or
delayed, on behalf of the Borrower and the Lenders, a successor Agent. If the
Agent has resigned and no successor Agent has been appointed, the Lenders may
perform all the duties of the Agent hereunder and the Borrower shall make all
payments in respect of the Obligations to the applicable Lender and for all
other purposes shall deal directly with the Lenders. No successor Agent shall
be deemed to be appointed hereunder until such successor Agent has accepted the
appointment. Any such successor Agent shall be a commercial bank having capital
and retained earnings of at least $100,000,000. Upon the acceptance of any
appointment as Agent hereunder by a successor Agent, such successor Agent shall
thereupon succeed to and become vested with all the rights, powers, privileges
and duties of the resigning Agent. Upon the effectiveness of the resignation of
the Agent, the resigning Agent shall be discharged from its duties and
obligations hereunder and under the Loan Documents. After the effectiveness of
the resignation of an Agent, the provisions of this Article X shall continue in
effect for the benefit of such Agent in respect of any actions taken or omitted
to be taken by it while it was acting as the Agent hereunder and under the other
Loan Documents.
ARTICLE XI
SETOFF; RATABLE PAYMENTS
------------------------
11.1 Setoff. In addition to, and without limitation of, any rights of the
Lenders under applicable law, if the Borrower becomes insolvent, however
evidenced, or any Default or Unmatured Default occurs, any and all deposits
(including all account balances, whether provisional or final and whether or not
collected or available) and any other Debt at any time held or owing by any
Lender to or for the credit or account of the Borrower may be offset and applied
toward the payment of the Obligations owing to such Lender, whether or not the
Obligations, or any part hereof, shall then be due.
11.2 Ratable Payments. If any Lender, whether by setoff or otherwise, has
payment made to it upon its Loans or in respect of its Letters of Credit (other
than payments received pursuant to Sections 3.1, 3.2 or 3.4) in a greater
proportion than that received by any other Lender, such Lender agrees, promptly
upon demand, to purchase a portion of the Obligations
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held by the other Lenders so that after such purchase each Lender will hold its
ratable proportion of the Obligations. If any Lender, whether in connection with
setoff or amounts which might be subject to setoff or otherwise, receives
collateral or other protection for its Obligations or such amounts which may be
subject to setoff, such Lender agrees, promptly upon demand, to take such action
necessary such that all Lenders share in the benefits of such collateral ratably
in proportion to their Percentage. In case any such payment is disturbed by
legal process, or otherwise, appropriate further adjustments shall be made.
ARTICLE XII
BENEFIT OF AGREEMENT; ASSIGNMENTS; PARTICIPATIONS
-------------------------------------------------
12.1 Successors and Assigns. The terms and provisions of the Loan
Documents shall be binding upon and inure to the benefit of the Borrower, the
Agent and the Lenders and their respective successors and permitted assigns,
except that (i) the Borrower shall not have the right to assign its rights or
obligations under the Loan Documents and (ii) any assignment by any Lender must
be made in compliance with Section 12.3. Notwithstanding clause (ii) of this
Section, any Lender may at any time, without the consent of the Borrower or the
Agent, assign all or any portion of its rights under this Agreement and its
Notes to a Federal Reserve Bank; provided, however, that no such assignment
shall release the transferor Lender from its obligations hereunder. The Agent
and the Borrower may treat the payee of any Note as the owner thereof for all
purposes hereof unless and until such payee complies with Section 12.3 in the
case of an assignment thereof. Any assignee or transferee of a Note agrees by
acceptance thereof to be bound by all the terms and provisions of the Loan
Documents. Any request, authority or consent of any Person, who at the time of
making such request or giving such authority or consent is the holder of any
Note, shall be conclusive and binding on any subsequent holder, transferee or
assignee of such Note or of any Note or Notes issued in exchange therefor.
12.2 Participations.
12.2.1 Permitted Participants; Effect. Any Lender may, in the ordinary
course of its business and in accordance with applicable law, at any time sell
to one or more banks or other entities ("Participants") participating interests
in any Loan owing to such Lender, any Note held by such Lender, any Commitment
of such Lender or any other interest of such Lender under the Loan Documents.
In the event of any such sale by a Lender of participating interests to a
Participant, such Lender's obligations under the Loan Documents shall remain
unchanged, such Lender shall remain solely responsible to the other parties
hereto for the performance of such obligations, such Lender shall remain the
holder of any such Note for all purposes under the Loan Documents, all amounts
payable by the Borrower under this Agreement shall be determined as if such
Lender had
76
not sold such participating interests, and the Borrower and the Agent shall
continue to deal solely and directly with such Lender in connection with such
Lender's rights and obligations under the Loan Documents.
12.2.2 Voting Rights. Each Lender shall retain the sole right to approve,
without the consent of any Participant, any amendment, modification or waiver of
any provision of the Loan Documents other than any amendment, modification or
waiver with respect to any Loan or Commitment in which such Participant has an
interest which forgives principal, interest or fees or reduces the interest rate
or fees payable with respect to any such Loan or Commitment, postpones any date
fixed for any regularly-scheduled payment of principal of, or interest or fees
on, any such Loan or Commitment, releases any Guarantor of any such Loan or
Letter of Credit or releases any substantial portion of collateral, if any,
securing any such Loan or Letter of Credit.
12.2.3 Benefit of Setoff. The Borrower agrees that each Participant shall be
deemed to have the right of setoff provided in Section 11.1 in respect of its
participating interest in amounts owing under the Loan Documents to the same
extent as if the amount of its participating interest were owing directly to it
as a Lender under the Loan Documents, provided that each Lender shall retain the
right of setoff provided in Section 11.1 with respect to the amount of
participating interests sold to each Participant. The Lenders agree to share
with each Participant, and each Participant, by exercising the right of setoff
provided in Section 11.1, agrees to share with each Lender, any amount received
pursuant to the exercise of its right of setoff, such amounts to be shared in
accordance with Section 11.2 as if each Participant were a Lender.
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12.3 Assignments.
12.3.1 Permitted Assignments. Any Lender may, in the ordinary course of its
business and in accordance with applicable law, at any time assign to one or
more banks or other entities ("Purchasers") all or any part of its rights and
obligations under the Loan Documents subject, in the case of assignments to a
Purchaser which is not a Lender prior to such assignment, to a minimum of
$20,000,000 or such lesser amount as may be consented to by the Borrower and the
Agent provided that any assignment by any Lender shall include a pro rata
assignment of its interest in the Aggregate Commitment. Such assignment shall
be in the form of Exhibit "F" hereto or in such other form as may be agreed to
by the Agent. The consent of the Agent and the Borrower shall be required prior
to an assignment becoming effective with respect to a Purchaser which is not a
Lender or an Affiliate thereof; provided, however, that if a Default has
occurred and is continuing, the consent of the Borrower shall not be required;
and provided, further, that if any Letters of Credit are outstanding, then such
assignment shall not become effective until such time as the Agent has received
the following:
(A) a modification of each assigning Lender's outstanding Letters of Credit
substantially in the form of Exhibit "B-2" reflecting the Stated Amount of such
Lender's outstanding Letters of Credit after giving effect to such assignment as
equal to the product of (x) such Lender's Percentage after giving effect to such
assignment, multiplied by (y) the aggregate Stated Amount of all outstanding
Letters of Credit,
(B) a new Letter of Credit from the Purchasers in the Stated Amount equal to
the product of (x) such Purchaser's Percentage after giving effect to the
assignment, multiplied by (y) the aggregate Stated Amount of all outstanding
Letters of Credit, and
(C) a CUSA Certificate reflecting the change in the Percentages resulting from
such assignment.
The consent of the Borrower and the Agent shall not be unreasonably withheld.
12.3.2 Effect; Effective Date. Upon (i) delivery to the Agent of a notice of
assignment, substantially in the form attached as Exhibit "I" to Exhibit "F"
hereto (a "Notice of Assignment"), together with any consents and other
documents required by Section 12.3.1, and (ii) payment of a $3,500 fee to the
Agent by the applicable Purchaser for processing such assignment, such
assignment shall become effective on the effective date specified in such Notice
of Assignment. The Notice of Assignment shall contain a representation by the
Purchaser to the effect that none of the consideration used to make
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the purchase of the Commitment and Loans under the applicable assignment
agreement are "plan assets" as defined under ERISA and that the rights and
interests of the Purchaser in and under the Loan Documents will not be "plan
assets" under ERISA. On and after the effective date of such assignment, such
Purchaser shall for all purposes be a Lender party to this Agreement and any
other Loan Document executed by the Lenders and shall have all the rights and
obligations of a Lender under the Loan Documents, to the same extent as if it
were an original party hereto, and no further consent or action by the Borrower,
the Lenders or the Agent shall be required to release the transferor Lender with
respect to the percentage of the Aggregate Commitment and Loans assigned to such
Purchaser. Upon the consummation of any assignment to a Purchaser pursuant to
this Section 12.3.2, the transferor Lender, the Agent and the Borrower shall
make appropriate arrangements so that replacement Notes are issued to such
transferor Lender and new Notes or, as appropriate, replacement Notes, are
issued to such Purchaser, in each case in principal amounts reflecting their
Commitment, as adjusted pursuant to such assignment and each replaced Note shall
be returned to the Borrower marked "cancelled and replaced." Notwithstanding any
assignment hereunder, the agreements and Obligations of the Borrower contained
in Section 3.1, 3.2, 3.4 or 9.7 with respect to the transferor Lender shall
survive such assignment and be enforceable by such transferor Lender, in
accordance with the terms of this Agreement, with respect to acts and
circumstances occurring prior to such transfer. Notwithstanding any assignment
hereunder, the agreements and obligations of the transferor Lender pursuant to
Section 10.3 shall survive such assignment and be enforceable by the Agent with
respect to acts and circumstances occurring prior to such transfer.
12.4 Dissemination of Information. The Borrower authorizes each Lender to
disclose to any Participant or Purchaser or any other Person acquiring an
interest in the Loan Documents by operation of law (each a "Transferee") and any
prospective Transferee any and all information in such Lender's possession
concerning the creditworthiness of the Borrower and its Subsidiaries, provided
such Participant, Purchaser, Transferee or other Person has signed a
confidentiality agreement substantially similar to the provisions of Section
9.14.
12.5 Tax Treatment. If any interest in any Loan Document is transferred to
any Transferee which is organized under the laws of any jurisdiction other than
the United States or any State thereof, the transferor Lender shall cause such
Transferee, concurrently with the effectiveness of such transfer, to comply with
the provisions of Section 2.17.
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ARTICLE XIII
NOTICES
-------
13.1 Giving Notice. Except as otherwise permitted by Section 2.12 with
respect to Borrowing Notices, all notices and other communications provided to
any party hereto under this Agreement or any other Loan Document shall be in
writing or by telecopy and addressed or delivered to such party at its address
set forth below its signature hereto or at such other address as may be
designated by such party in a notice to the other parties. Any notice, if
mailed and properly addressed with postage prepaid, shall be deemed given when
received; any notice, if transmitted by telecopy, shall be deemed given when
transmitted on any Business Day.
13.2 Change of Address. The Borrower, the Agent and any Lender may each
change the address for service of notice upon it by a notice in writing to the
other parties hereto.
ARTICLE XIV
COUNTERPARTS
------------
This Agreement may be executed in any number of counterparts, all of which
taken together shall constitute one agreement, and any of the parties hereto may
execute this Agreement by signing any such counterpart. This Agreement shall be
effective when it has been executed by the Borrower, the Agent and the Lenders
and each party has notified the Agent by telex or telephone, that it has taken
such action.
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IN WITNESS WHEREOF, the Borrower, the Lenders and the Agent have executed this
Agreement as of the date first above written.
NGC CORPORATION
By:___________________________
Print Name:___________________
Title:________________________
▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Attn: Senior Vice President and Chief
Financial Officer
Telephone No.: ▇▇▇-▇▇▇-▇▇▇▇
Telecopy No.: ▇▇▇-▇▇▇-▇▇▇▇
with a copy to:
Attn: Senior Vice President
and General Counsel
Commitments
-----------
$30,000,000 CANADIAN IMPERIAL BANK OF
COMMERCE, Individually and as Agent
By:__________________________
Print Name:__________________
Title:_______________________
Attn:________________________
Telecopy No.:________________
with a copy to:
Canadian Imperial Bank of Commerce
▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇ ▇▇▇▇
Telephone No.: ▇▇▇-▇▇▇-▇▇▇▇
Telecopy No.: ▇▇▇-▇▇▇-▇▇▇▇
$30,000,000 ABN AMRO BANK, N.V.
By:_________________________
Print Name:_________________
Title:______________________
By:_________________________
Print Name:_________________
Title:______________________
____________________________
____________________________
Attn:_______________________
Telecopy No.:_______________
$30,000,000 THE BANK OF BOSTON
By:_________________________
Print Name:_________________
Title:______________________
____________________________
Attn:_______________________
Telecopy No.:_______________
$30,000,000 THE BANK OF MONTREAL
By:_________________________
Print Name:_________________
Title:______________________
____________________________
____________________________
Attn:_______________________
Telecopy No.:_______________
$30,000,000 THE BANK OF NOVA SCOTIA
By:_________________________
Print Name:_________________
Title:______________________
____________________________
____________________________
Attn:_______________________
Telecopy No.:_______________
$20,000,000 THE CHASE MANHATTAN BANK
By:_________________________
Print Name:_________________
Title:______________________
____________________________
____________________________
Attn:_______________________
Telecopy No.:_______________
$30,000,000 CREDIT LYONNAIS NEW YORK BRANCH
By:_________________________
Print Name:_________________
Title:______________________
____________________________
____________________________
Attn:_______________________
Telecopy No.:_______________
$20,000,000 THE FIRST NATIONAL BANK OF CHICAGO
By:_________________________
Print Name:_________________
Title:______________________
____________________________
____________________________
Attn:_______________________
Telecopy No.:_______________
$30,000,000 MELLON BANK, N.A. (WEST)
By:_________________________
Print Name:_________________
Title:______________________
____________________________
____________________________
Attn:_______________________
Telecopy No.:_______________
$20,000,000 NATIONSBANK OF TEXAS, N.A.
By:_________________________
Print Name:_________________
Title:______________________
____________________________
____________________________
Attn:_______________________
Telecopy No.:_______________
$30,000,000 ROYAL BANK OF CANADA
By:_________________________
Print Name:_________________
Title:______________________
____________________________
____________________________
Attn:_______________________
Telecopy No.:_______________
EXHIBIT "A-1"
NOTE
$___________ September 1, 1996
NGC Corporation, a Delaware corporation (the "Borrower"), promises to
pay to the order of _____________________________________ (the "Lender") the
lesser of the principal sum of __________________________ Million Dollars or the
aggregate unpaid principal amount of all Loans made by the Lender to the
Borrower pursuant to Section 2.1 of the Letter of Credit Facility Agreement,
dated as of September 1, 1996, among the Borrower and Canadian Imperial Bank of
Commerce, individually and as Agent, and the Lenders named therein (as the same
may be amended or modified, the "Agreement") and unpaid reimbursement
obligations with respect to amounts paid by the Lender pursuant to Letters of
Credit (as defined in the Agreement) issued pursuant to Section 2.2 of the
Agreement, in lawful money of the United States in immediately available funds
at the main office of Canadian Imperial Bank of Commerce, New York, New York, as
Agent or as otherwise directed by the Agent pursuant to the terms of the
Agreement, together with interest, in like money and funds, on the unpaid
principal amount hereof at the rates and on the dates set forth in the
Agreement. The Borrower shall pay each Loan in full on the Commitment
Termination Date (as defined in the Agreement), and mandatory repayments of
principal will be made by the Borrower as set forth in the Agreement.
The Lender shall, and is hereby authorized to, record on the schedule
attached hereto, or to otherwise record in accordance with its usual practice,
the date and amount of each Loan and each draw of each Letter of Credit issued
by the Lender and the date and amount of each principal payment hereunder
provided, however, that any failure to so record shall not affect the Borrower's
obligations under any Loan Document.
This Note is one of the Notes issued pursuant to, and is entitled to
the benefits of, the Agreement, as it may be amended from time to time.
Reference is hereby made to the Agreement for a statement of the terms and
conditions under which this Note may be prepaid or its maturity date
accelerated. Capitalized terms used herein and not otherwise defined herein are
used with the meanings attributed to them in the Agreement.
Borrower and any endorser hereof waive presentment, notice of dishonor
and protest, and assent to any extension of time with respect to any payment due
under this Note and to the addition or release of any party.
NGC CORPORATION
Exhibit A-1 Page 1
Exhibit A-1 Page 2
SCHEDULE OF LOANS, DRAWS AND PAYMENTS OF PRINCIPAL
TO
NOTE OF NGC CORPORATION
DATED SEPTEMBER 1, 1996
==========================================================================
Amount of Loan Maturity Principal
or Letter of of Applicable Amount Unpaid
Date Credit Draw Type Interest Rate Paid Balance
Period
--------------------------------------------------------------------------
--------------------------------------------------------------------------
--------------------------------------------------------------------------
--------------------------------------------------------------------------
--------------------------------------------------------------------------
--------------------------------------------------------------------------
==========================================================================
Exhibit A-1 Page 3
EXHIBIT "B-1"
FORM OF LETTER OF CREDIT
[ISSUER]
_____________________
_____________________
Attention: __________
Irrevocable Letter of Credit
Date of Issue: ___________, 1996
Credit Number:
Beneficiary: Chevron U.S.A. Inc.
▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇., ▇▇▇▇ ____
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Attention:___________________
Applicant: NGC Corporation (on behalf of Natural
Gas Clearinghouse)
▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Total Amount: US$ ______________
Expiry Date: _________, 1997
Percentage: ____ %
Pursuant to that certain Letter of Credit Facility Agreement dated as of
_______________, 1996 (as amended, supplemented or otherwise modified and in
effect from time to time, the "Facility Agreement") between the Applicant,
Canadian Imperial Bank of Commerce, as agent (the "Agent"), and the Lenders
named therein, _____________________ (hereinafter called "the Bank") hereby
opens its Irrevocable Letter of Credit (the "Letter of Credit") for the account
of
Exhibit B-1 Page 1
the Applicant and agrees to pay, at sight, to the Beneficiary an amount not
to exceed the above-referenced Total Amount on the terms and conditions set
forth herein. The Total Amount or the Expiry Date may be reduced and/or the
Percentage may be changed from time to time by delivering to the Agent on any
date a certificate in the form of Annex B hereto.
If the Beneficiary shall deliver to the Bank a certificate (each a "Drawing
Certificate") in the form of Annex A hereto, accompanied by a copy of a
statement (the "Statement") issued pursuant to that certain Natural Gas Purchase
and Sale Agreement dated ________, 1996 among Natural Gas Clearinghouse and the
Beneficiary (the "Gas Purchase Agreement"), then the Bank agrees to honor its
payment obligations herein by wiring such sums as shall be directed in such
Drawing Certificate, not exceeding in the aggregate the Total Amount hereof,
into the an account (the "Applicable Account") identified as follows:
______________________________
______________________________
Account No. __________________
The liability of the Bank shall not be discharged by any payment or succession
of payments hereunder, unless and until such payment or payments shall amount in
the aggregate to the Total Amount of this Letter of Credit, but in no event
shall the obligation of the Bank hereunder exceed the amount of said Total
Amount.
This Letter of Credit will expire at the close of business on the Expiry Date
unless renewed in a written agreement from the Bank.
Wire transfers to the Applicable Account pursuant to this Letter of Credit shall
be made by the Bank upon presentation, during the Bank's business hours, of a
Drawing Certificate in the form of Annex A hereto to the Bank at its office
identified above or at any other location which may be designated by the Bank in
a written notice delivered to the Beneficiary at the address identified above.
If a Drawing Certificate is delivered to the Bank at or prior to 10:00 a.m., New
York City time, on a Business Day (as hereinafter defined) and provided that
such Drawing Certificate and the documents presented in connection therewith
conform to the terms and conditions hereof, payment shall be made to the
Beneficiary not later than 2:00 p.m., New York City time, on the same Business
Day; provided that if any Drawing Certificate is delivered to the Bank after
10:00 a.m., New York City time, on a Business Day and provided that such Drawing
Certificate and the documents presented in connection therewith conform to the
terms and conditions hereof, payment shall be made to the Beneficiary not later
than 2:00 p.m., New York City time, on the
Exhibit B-1 Page 2
next succeeding Business Day. As used herein, the term "Business Day" shall
mean, in each case, any day other than a Saturday, Sunday or a day on which
banking corporations (including trust companies) in the State of New York are
authorized or required by law to close.
This Letter of Credit is neither transferable nor assignable.
THIS LETTER OF CREDIT IS GOVERNED BY THE UNIFORM CUSTOMS AND PRACTICE FOR
DOCUMENTARY CREDITS, 1993 REVISION, INTERNATIONAL CHAMBER OF COMMERCE
PUBLICATION 500 (THE "UNIFORM CUSTOMS"), AND TO THE EXTENT NOT INCONSISTENT WITH
THE UNIFORM CUSTOMS, THIS LETTER OF CREDIT SHALL BE DEEMED TO BE A CONTRACT MADE
UNDER THE LAWS OF THE STATE OF ILLINOIS AND SHALL, AS TO MATTERS NOT GOVERNED BY
THE UNIFORM CUSTOMS, BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF
SAID STATE APPLICABLE TO CONTRACTS MADE AND TO BE PERFORMED ENTIRELY WITHIN SUCH
STATE.
In Witness Whereof, the Bank has executed this Letter of Credit on the date set
forth above.
[BANK]
By:____________________
Name:__________________
Title:_________________
Exhibit B-1 Page 3
ANNEX A
DRAWING CERTIFICATE
[DATE]
[Bank]
________________
________________
Attn: __________
Re: Irrevocable Letter of Credit No. _________ (the "Letter of Credit")
Capitalized terms used herein and not otherwise defined shall have the
meanings assigned them in the Letter of Credit.
The undersigned, a duly authorized representative of the Beneficiary,
hereby certifies to you that:
(i) Attached hereto as Exhibit A is a true and correct copy of a
Statement issued pursuant to that certain Gas Purchase Agreement, and
$___________ (the "Unpaid Amount") of the amount shown as owing on the Statement
was not paid by the Applicant when due and remains unpaid.
(ii) You are hereby directed to wire transfer $____________ [Here
specify an amount not to exceed the Total Amount as reduced by any prior draw
requests] (the "Drawing Amount") into the Applicable Account as identified in
the Letter of Credit.
(iii) The Drawing Amount does not exceed the Total Amount as reduced
by any prior draw requests under the Letter of Credit, i.e., the Drawing Amount
does not exceed the maximum amount permitted to be drawn under the Letter of
Credit in accordance with the Letter of Credit.
(iv) The Drawing Amount equals the product of (i) the Percentage as
identified in the Letter of Credit, multiplied by (ii) the Unpaid Amount.
(v) The Beneficiary has not received any other payments under the
Letter of Credit with respect to the Unpaid Amount.
(vi) The Beneficiary has delivered a comparable drawing certificate,
dated of even date herewith, to each other bank party to the Facility Agreement,
which drawing
Exhibit B-1 Page 4
certificate directs each such bank to make payment to the
Beneficiary in an amount equal to the product of (i) such bank's Percentage (as
defined in such bank's letter of credit), multiplied by (ii) the Unpaid Amount.
Exhibit B-1 Page 5
IN WITNESS WHEREOF, the undersigned has executed and delivered this
Certificate as of the ____ day of _________, 199__.
BENEFICIARY:
-----------
CHEVRON U.S.A. INC.
By: _________________________________
Name:________________________________
Title:_______________________________
cc: Canadian Imperial Bank of Commerce
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇▇▇▇ ▇▇▇▇
Exhibit B-1 Page 6
ANNEX B
CERTIFICATE REGARDING
MODIFICATIONS OF LETTERS OF CREDIT
[DATE]
Canadian Imperial Bank of Commerce
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇▇▇▇ ▇▇▇▇
Re: Letter of Credit Facility Agreement, dated as of September 1, 1996 (as
amended, supplemented or otherwise modified and in effect from time to
time, the "Facility Agreement"), between the NGC Corporation, Canadian
Imperial Bank of Commerce, as agent, and the Lenders named therein
Capitalized terms used herein and not otherwise defined shall have the
meanings assigned them in the Facility Agreement.
The undersigned, a duly authorized representative of Chevron U.S.A. Inc.
(the "Beneficiary"), hereby certifies to you and the Lenders in the Facility
Agreement that:
(vii) Effective on ________________, 19__ [insert date at least three (3)
Business Days after the date of the certificate], the Beneficiary shall
thereafter deem the Total Amount, the Expiry Date and the Percentage (each as
described in the letters of credit identified below) to be adjusted as set forth
below for each of the letters of credit identified below/1/:
Expiry
Letter of Credit Percentage Date Total Amount
-------------------------------------------------------------------------------
Irrevocable Letter of
Credit No. _________ issued
by _______________ _____% ________ $____________
-------------------
/1/ List each of the letters of credit issued to the Beneficiary pursuant to
the Facility Agreement and complete with the information agreed to by the
Beneficiary.
Exhibit B-1 Page 7
Irrevocable Letter of
Credit No. _________ issued
by _______________ _____% ________ $____________
Irrevocable Letter of
Credit No. _________ issued
by _______________ _____% ________ $____________
--------------------------------------------------------------------------------
Total 100% $____________
(viii) The Beneficiary has the power and authority to amend each of the
letters of credit identified above in the manner described above and has not
assigned or transferred in any manner whatsoever such letters of credit or any
rights therein.
IN WITNESS WHEREOF, the undersigned has executed and delivered this
Certificate as of the ____ day of _________, 199__.
BENEFICIARY:
CHEVRON U.S.A. INC.
By:
--------------------------------------
Name:
------------------------------------
Title:
-----------------------------------
Exhibit B-1 Page 8
EXHIBIT "B-2"
FORM OF LETTER OF CREDIT MODIFICATION
_______________, 19___
AMENDMENT #___ TO IRREVOCABLE LETTER OF CREDIT NO. ___________
Beneficiary: Chevron U.S.A. Inc.
▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇., ▇▇▇▇ ____
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Attention:___________________
Applicant: NGC Corporation (on behalf of Natural
Gas Clearinghouse)
▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
THIS AMENDMENT MUST BE CONSIDERED AS PART
OF THE ABOVE MENTIONED CREDIT AND MUST BE
ATTACHED THERETO.
The above mentioned Letter of Credit is amended as follows, effective ,
19 ./1/
(1) [The Total Amount of the Letter of Credit has been [increased/reduced]/1/
by USD _____________. The Total Amount is now USD ______________________.]
--------------
/2/ Insert the effective date of the amendment as appropriate pursuant to
the L/C Modification Notice provided by the Borrower.
/3/ Choose increased or reduced as the case may be.
Exhibit B-2 Page 1
(2) [The Expiry Date of the Letter of Credit has been [extended/shortened]/1/
to ____________, 19_____.]
(3) [The Percentage applicable to the Letter of Credit has been changed to
________%.]
All other terms and conditions remain unchanged. All references to the Letter
of Credit in any other document, instrument, agreement or writing shall
hereafter be deemed to refer to the Letter of Credit as amended hereby.
Very truly yours,
[BANK]
By:
----------------------------------------
Name:
--------------------------------------
Title:
-------------------------------------
By:
----------------------------------------
Name:
---------------------------------------
Title:
--------------------------------------
--------------
/4/ Choose extended or shortened as the case may be.
Exhibit B-2 Page 2
EXHIBIT "C"
FORM OF OPINION OF BORROWER'S COUNSEL
(to be provided)
Exhibit C Page 1
EXHIBIT "D"
COMPLIANCE CERTIFICATE
To: The Lenders parties to the
Letter of Credit Facility
Agreement Described Below
This Compliance Certificate is furnished pursuant to that certain Letter of
Credit Facility Agreement dated as of September 1, 1996 (as amended, modified,
renewed or extended from time to time, the "Agreement") among the Borrower, the
lenders party thereto and Canadian Imperial Bank of Commerce, as Agent for the
Lenders. Unless otherwise defined herein, capitalized terms used in this
Compliance Certificate have the meanings ascribed thereto in the Agreement.
THE UNDERSIGNED HEREBY CERTIFIES THAT:
1. I am an Authorized Officer;
2. I have reviewed the terms of the Agreement and I have made, or have
caused to be made under my supervision, a detailed review of the transactions
and conditions of the Borrower and its Subsidiaries during the accounting period
covered by the attached financial statements;
3. The examinations described in paragraph 2 did not disclose, and I have
no knowledge of, the existence of any condition or event which constitutes a
Default or Unmatured Default during or at the end of the accounting period
covered by the attached financial statements or as of the date of this
Certificate, except as set forth below; and
4. Schedule I attached hereto sets forth financial data and computations
evidencing the Borrower's compliance with certain covenants of the Agreement,
all of which data and computations are true, complete and correct.
Described below are the exceptions, if any, to paragraph 3 by listing, in
detail, the nature of the condition or event, the period during which it has
existed and the action which the Borrower has taken, is taking, or proposes to
take with respect to each such condition or event:
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Exhibit D Page 1
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
The foregoing certifications, together with the computations set forth in
Schedule I hereto and the financial statements delivered with this Certificate
in support hereof, are made and delivered this ____ day of ______________,
19___.
-----------------------------------
Exhibit D Page 2
[SAMPLE]
SCHEDULE I TO COMPLIANCE CERTIFICATE
Schedule of Compliance as of with
Provisions of ______ and ________ of
the Agreement
Exhibit D Page 3
EXHIBIT "E-1"
(to Credit Agreement)
ISSUANCE REQUEST
To: Canadian Imperial Bank of Commerce
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇▇▇▇ ▇▇▇▇
WITH
COPY
TO: Canadian Imperial Bank of Commerce
▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇ ▇▇▇▇
Ladies and Gentlemen:
The undersigned is an Authorized Representative of NGC Corporation, a
Delaware corporation, and is authorized to make and deliver this certificate
pursuant to that certain Letter of Credit Facility Agreement dated as of
September 1, 1996 among NGC Corporation, a Delaware corporation, each of the
entities which is a party thereto as a lender, and Canadian Imperial Bank of
Commerce, as agent for itself and the other lenders party thereto, (said Letter
of Credit Facility Agreement, as it may be amended, supplemented or otherwise
modified from time to time, is hereinafter referred to as the "Credit
Agreement"). Terms having their initial letters capitalized and not otherwise
defined herein shall have the meanings assigned to them in the Credit Agreement.
Pursuant to the terms and provisions of the Credit Agreement, the
undersigned Borrower hereby certifies that all conditions to the issuance of
Letters of Credit pursuant to Section 2.2.1 of the Credit Agreement have been
met.
The undersigned Borrower hereby requests the issuance of Letters of Credit
in accordance with the Credit Agreement in substantially the form attached and
containing the following terms:
Credit Issuance Request Information
----------------------------------
Exhibit E-1 Page 1
1. Beneficiary: Chevron U.S.A. Inc.
▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇., ▇▇▇▇ ____
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Attn:_________________________
2. Aggregate Stated Amount of all Letters of Credit to be issued: $________
3. Requested Date of Issuance: , 19__
4. Requested Date of Expiry: , 19__
EXECUTED THIS ____ DAY OF _______________, 19__.
NGC CORPORATION
By:
--------------------------------
Name:
------------------------------
Title:
-----------------------------
Exhibit E-1 Page 2
EXHIBIT "E-2"
(to Credit Agreement)
L/C MODIFICATION NOTICE
To: Canadian Imperial Bank of Commerce
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇▇▇▇ ▇▇▇▇
WITH
COPY
TO: Canadian Imperial Bank of Commerce
▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇ ▇▇▇▇
Ladies and Gentlemen:
The undersigned is an Authorized Representative of NGC Corporation, a
Delaware corporation, and is authorized to make and deliver this certificate
pursuant to that certain Letter of Credit Facility Agreement dated as of
September 1, 1996 among NGC Corporation, a Delaware corporation, each of the
entities which is a party thereto as a lender, and Canadian Imperial Bank of
Commerce, as agent for itself and the other lenders party thereto, (said Letter
of Credit Facility Agreement, as it may be amended, supplemented or otherwise
modified from time to time, is hereinafter referred to as the "Credit
Agreement"). Terms having their initial letters capitalized and not otherwise
defined herein shall have the meanings assigned to them in the Credit Agreement.
Pursuant to the terms and provisions of the Credit Agreement, the
undersigned Borrower hereby certifies that all conditions to the modification of
Letters of Credit pursuant to Section 2.2.6 of the Credit Agreement have been
met.
Effective on _____________________, 19____ [insert date at least three (3)
Business Days after the date of the notice], the undersigned Borrower hereby
requests the modification of the outstanding Letters of Credit identified below
in accordance with the Credit Agreement in substantially the form attached and
containing the following terms:
Exhibit E-2 Page 1
New Expiry
Letter of Credit Date Stated Amount
(if applicable)
--------------------------------------------------------------------------------
Irrevocable Letter of
Credit No. _________ issued
by _______________ __________ $____________
Irrevocable Letter of
Credit No. _________ issued
by _______________ ___________ $____________
Irrevocable Letter of
Credit No. _________ issued
by _______________ ____________ $____________
--------------------------------------------------------------------------------
Total 100% $____________
EXECUTED THIS ____ DAY OF _______________, 19__.
NGC CORPORATION
By:
-------------------------------
Name:
------------------------------
Title:
----------------------------
Exhibit E-2 Page 2
EXHIBIT "F"
ASSIGNMENT AGREEMENT
This Assignment Agreement (this "Assignment Agreement") between
__________________________ (the "Assignor") and __________________ (the
"Assignee") is dated as of _________________, 19__. The parties hereto agree as
follows:
1. PRELIMINARY STATEMENT. The Assignor is a party to a Letter of Credit
Facility Agreement (which, as it may be amended, modified, renewed or extended
from time to time is herein called the "Credit Agreement") described in Item 1
of Schedule 1 attached hereto ("Schedule 1"). Capitalized terms used herein and
not otherwise defined herein shall have the meanings attributed to them in the
Credit Agreement.
2. ASSIGNMENT AND ASSUMPTION. The Assignor hereby sells and assigns to
the Assignee, and the Assignee hereby purchases and assumes from the Assignor,
an interest in and to the Assignor's rights and obligations under the Credit
Agreement such that after giving effect to such assignment the Assignee shall
have purchased pursuant to this Assignment Agreement the percentage interest
specified in Item 3 of Schedule 1 of all outstanding rights and obligations
under the Credit Agreement relating to the facilities listed in Item 3 of
Schedule 1 and the other Loan Documents. The aggregate Commitment (or Loans and
Letters of Credit, if the applicable Commitment has been terminated) purchased
by the Assignee hereunder is set forth in Item 4 of Schedule 1.
3. EFFECTIVE DATE. The effective date of this Assignment Agreement (the
"Effective Date") shall be the later of the date specified in Item 5 of Schedule
1 or two Business Days (or such shorter period agreed to by the Agent) after a
Notice of Assignment substantially in the form of Exhibit "I" attached hereto
has been delivered to the Agent. Such Notice of Assignment must include any
consents, other documents and fees required to be delivered to the Agent by
Sections 12.3.1 and 12.3.2 of the Credit Agreement. In no event will the
Effective Date occur if the payments required to be made by the Assignee to the
Assignor on the Effective Date under Sections 4 and 5 hereof are not made on the
proposed Effective Date. The Assignor will notify the Assignee of the proposed
Effective Date no later than the Business Day prior to the proposed Effective
Date. As of the Effective Date, (i) the Assignee shall have the rights and
obligations of a Lender under the Loan Documents with respect to the rights and
obligations assigned to the Assignee hereunder and (ii) the Assignor shall
relinquish its rights and be released from its corresponding obligations under
the Loan Documents (other than its obligations pursuant to Section 10.3 with
respect to acts and circumstances occurring prior to the Effective Date) with
respect to the rights and obligations assigned to the Assignee hereunder.
Exhibit F Page 1
4. PAYMENTS OBLIGATIONS. On and after the Effective Date, the Assignee
shall be entitled to receive from the Agent all payments of principal, interest,
fees and reimbursement with respect to the interest assigned hereby. The
Assignee shall advance funds directly to the Agent with respect to all Loans and
reimbursement payments made on or after the Effective Date with respect to the
interest assigned hereby. [In consideration for the sale and assignment of
Loans hereunder, (i) the Assignee shall pay the Assignor, on the Effective Date,
an amount equal to the principal amount of the portion of all Base Rate Loans
assigned to the Assignee hereunder and (ii) with respect to each Eurodollar Loan
made by the Assignor and assigned to the Assignee hereunder which is outstanding
on the Effective Date, on the earliest of (a) the last day of the Interest
Period therefor or (b) such earlier date agreed to by the Assignor and the
Assignee or (c) the date on which any such Eurodollar Loan either becomes due
(by acceleration or otherwise) or is prepaid (the date as described in the
foregoing clauses (a), (b) or (c) being hereinafter referred to as the "Payment
Date"), the Assignee shall pay the Assignor an amount equal to the principal
amount of the portion of such Eurodollar Loan assigned to the Assignee which is
outstanding on the Payment Date. If the Assignor and the Assignee agree that
the Payment Date for such Eurodollar Loan shall be the Effective Date, they
shall agree to the interest rate applicable to the portion of such Loan assigned
hereunder for the period from the Effective Date to the end of the existing
Interest Period applicable to such Eurodollar Loan (the "Agreed Interest Rate")
and any interest received by the Assignee in excess of the Agreed Interest Rate
shall be remitted to the Assignor. In the event interest for the period from
the Effective Date to but not including the Payment Date is not paid by the
Borrower with respect to any Eurodollar Loan sold by the Assignor to the
Assignee hereunder, the Assignee shall pay to the Assignor interest for such
period on the portion of such Eurodollar Loan sold by the Assignor to the
Assignee hereunder at the applicable rate provided by the Credit Agreement. In
the event a prepayment of any Eurodollar Loan which is existing on the Payment
Date and assigned by the Assignor to the Assignee hereunder occurs after the
Payment Date but before the end of the Interest Period applicable to such
Eurodollar Loan, the Assignee shall remit to the Assignor the excess of the loss
or cost paid by the Borrower pursuant to Section 3.4 with respect to the portion
of such Eurodollar Loan assigned to the Assignee hereunder over the amount which
would have been paid if such loss or cost was calculated based on the Agreed
Interest Rate. The Assignee will also promptly remit to the Assignor (i) any
principal payments received from the Agent with respect to Eurodollar Loans
prior to the Payment Date and (ii) any amounts of interest on Loans and fees
received from the Agent which relate to the portion of the Loans assigned to the
Assignee hereunder for periods prior to the Effective Date, in the case of Base
Rate Loans or fees, or the Payment Date, in the case of Eurodollar Loans, and
not previously paid by the Assignee to the Assignor.]* In the event that either
party hereto receives any payment to which the other party hereto is entitled
under this Assignment Agreement, then the party receiving such amount shall
promptly remit it to the other party hereto.
Exhibit F Page 2
*Each Assignor may insert its standard payment provisions in lieu of the payment
terms included in this Exhibit.
5. FEES PAYABLE BY THE ASSIGNEE. The Assignee shall pay to the Assignor
a fee on each day on which a payment of interest or commitment fees is made
under the Credit Agreement with respect to the amounts assigned to the Assignee
hereunder (other than a payment of interest or commitment fees for the period
prior to the Effective Date or, in the case of Eurodollar Loans, the Payment
Date, which the Assignee is obligated to deliver to the Assignor pursuant to
Section 4 hereof). The amount of such fee shall be the difference between (i)
the interest or fee, as applicable, paid with respect to the amounts assigned to
the Assignee hereunder and (ii) the interest or fee, as applicable, which would
have been paid with respect to the amounts assigned to the Assignee hereunder if
each interest rate was ___ of 1% less than the interest rate paid by the
Borrower or if the commitment fee was ___ of 1% less than the commitment fee
paid by the Borrower, as applicable. In addition, the Assignee agrees to pay
___% of the processing fee required to be paid to the Agent in connection with
this Assignment Agreement.
6. REPRESENTATIONS OF THE ASSIGNOR; LIMITATIONS ON THE ASSIGNOR'S
LIABILITY. The Assignor represents and warrants that it is the legal and
beneficial owner of the interest being assigned by it hereunder and that such
interest is free and clear of any adverse claim created by the Assignor. It is
understood and agreed that the assignment and assumption hereunder are made
without recourse to the Assignor and that the Assignor makes no other
representation or warranty of any kind to the Assignee. Neither the Assignor
nor any of its officers, directors, employees, agents or attorneys shall be
responsible for (i) the due execution, legality, validity, enforceability,
genuineness, sufficiency or collectibility of any Loan Document, including
without limitation, documents granting the Assignor and the other Lenders a
security interest in assets of the Borrower or any guarantor, (ii) any
representation, warranty or statement made in or in connection with any of the
Loan Documents, (iii) the financial condition or creditworthiness of the
Borrower or any guarantor, (iv) the performance of or compliance with any of the
terms or provisions of any of the Loan Documents, (v) inspecting any of the
Property, books or records of the Borrower, (vi) the validity, enforceability,
perfection, priority, condition, value or sufficiency of any collateral securing
or purporting to secure the Loans or (vii) any mistake, error of judgment, or
action taken or omitted to be taken in connection with the Loans or the Loan
Documents.
7. REPRESENTATIONS OF THE ASSIGNEE. The Assignee (i) confirms that it
has received a copy of the Credit Agreement, together with copies of the
financial statements requested by the Assignee and such other documents and
information as it has deemed appropriate to make its own credit analysis and
decision to enter into this Assignment Agreement, (ii) agrees that it will,
independently and without reliance upon the Agent, the
Exhibit F Page 3
Assignor or any other Lender and based on such documents and information at it
shall deem appropriate at the time, continue to make its own credit decisions in
taking or not taking action under the Loan Documents, (iii) appoints and
authorizes the Agent to take such action as agent on its behalf and authorizes
the Agent to exercise such powers under the Loan Documents as are delegated to
the Agent by the terms thereof, together with such powers as are reasonably
incidental thereto, (iv) agrees that it will perform in accordance with their
terms all of the obligations which by the terms of the Loan Documents are
required to be performed by it as a Lender, (v) agrees that its payment
instructions and notice instructions are as set forth in the attachment to
Schedule 1, (vi) confirms that none of the funds, monies, assets or other
consideration being used to make the purchase and assumption hereunder are "plan
assets" as defined under ERISA and that its rights, benefits and interests in
and under the Loan Documents will not be "plan assets" under ERISA, [and (vii)
attaches the forms prescribed by the Internal Revenue Service of the United
States certifying that the Assignee is entitled to receive payments under the
Loan Documents without deduction or withholding of any United States federal
income taxes].**
**to be inserted if the Assignee is not incorporated under the laws of the
United States, or a state thereof.
8. INDEMNITY. The Assignee agrees to indemnify and hold the Assignor
harmless against any and all losses, costs and expenses (including, without
limitation, reasonable attorneys' fees) and liabilities incurred by the Assignor
in connection with or arising in any manner from the Assignee's non-performance
of the obligations assumed under this Assignment Agreement.
9. SUBSEQUENT ASSIGNMENTS. After the Effective Date, the Assignee shall
have the right pursuant to Section 12.3.1 of the Credit Agreement to assign the
rights which are assigned to the Assignee hereunder to any entity or person,
provided that (i) any such subsequent assignment does not violate any of the
terms and conditions of the Loan Documents or any law, rule, regulation, order,
writ, judgment, injunction or decree and that any consent required under the
terms of the Loan Documents has been obtained and (ii) unless the prior written
consent of the Assignor is obtained, the Assignee is not thereby released from
its obligations to the Assignor hereunder, if any remain unsatisfied, including,
without limitation, its obligations under [Sections 4, 5 and 8] hereof.
10. REDUCTIONS OF AGGREGATE COMMITMENT. If any reduction in the Aggregate
Commitment occurs between the date of this Assignment Agreement and the
Effective Date, the percentage interest specified in Item 3 of Schedule 1 shall
remain the same, but the dollar amount purchased shall be recalculated based on
the reduced Aggregate Commitment.
Exhibit F Page 4
11. ENTIRE AGREEMENT. This Assignment Agreement and the attached Notice
of Assignment embody the entire agreement and understanding between the parties
hereto and supersede all prior agreements and understandings between the parties
hereto relating to the subject matter hereof.
12. GOVERNING LAW. This Assignment Agreement shall be governed by the
internal law, and not the law of conflicts, of the State of Illinois.
13. NOTICES. Notices shall be given under this Assignment Agreement in
the manner set forth in the Credit Agreement. For the purpose hereof, the
addresses of the parties hereto (until notice of a change is delivered) shall be
the address set forth in the attachment to Schedule 1.
Exhibit F Page 5
IN WITNESS WHEREOF, the parties hereto have executed this Assignment
Agreement by their duly authorized officers as of the date first above written.
[NAME OF ASSIGNOR]
By:
-------------------------------------
Title:
----------------------------------
----------------------------------
----------------------------------
[NAME OF ASSIGNEE]
By:
--------------------------------------
Title:
-----------------------------------
-----------------------------------
-----------------------------------
Exhibit F Page 6
SCHEDULE 1
to Assignment Agreement
1. Description and Date of Credit Agreement:
2. Date of Assignment Agreement: _____________, 19__
3. Amounts (As of Date of Item 2 above):
a. Total of Commitment
(Loans/Letter of
Credit Liabilities)* under
Credit Agreement $_____________
b. Aggregate Stated Amount of
Assignor's Letters of Credit
outstanding prior to the
the Assignment $_____________
c. Assignee's Percentage
purchased under the
Assignment Agreement** ______________%
d. Aggregate Stated Amount of
Letters of Credit to be
issued by Assignee under
the Assignment $_____________
e. Assignor's Percentage
retained under the
Assignment Agreement** ______________%
f. Aggregate Stated Amount of
Letters of Credit from
Assignor outstanding after
the Assignment $_____________
Exhibit F Page 7
* If a Commitment has been terminated, insert outstanding Loans and Letter of
Credit Liabilities in place of Commitment
** Percentage taken to 10 decimal places
4. Proposed Effective Date: ----------
Accepted and Agreed:
[NAME OF ASSIGNOR] [NAME OF ASSIGNEE]
By: By:
-------------------- --------------------
Title: Title:
----------------- -----------------
Exhibit F Page 8
Attachment to SCHEDULE 1 to ASSIGNMENT AGREEMENT
Attach Assignor's Administrative Information Sheet, which must
include notice address for the Assignor and the Assignee
Exhibit F Page 9
Exhibit "I" to Assignment Agreement
NOTICE OF ASSIGNMENT
--------------------
_____________, 19___
To: Canadian Imperial Bank of Commerce
NGC Corporation
From: [Assignor]
[Assignee]
XV We refer to that certain Letter of Credit Facility Agreement, dated as
of September 1, 1996 (which, as it may be amended, supplemented, restated or
otherwise modified and in effect from time to time, is herein called the "Credit
Agreement"), as amended, among NGC Corporation (the "Company"), certain Lenders
parties thereto (each a "Lender"), including __________________ (the
"Assignor"), and Canadian Imperial Bank of Commerce, as Agent (as such, the
"Agent"). Capitalized terms used herein and in any consent delivered in
connection herewith and not otherwise defined herein or in such consent shall
have the meanings attributed to them in the Credit Agreement.
XVI This Notice of Assignment (this "Notice") is given and delivered to the
Company and the Agent pursuant to Section 12.3 of the Credit Agreement.
XVII The Assignor and ______________________ (the "Assignee") have entered
into an Assignment Agreement, dated as of ___________, 19___ (the "Assignment"),
pursuant to which, among other things, the Assignor has sold, assigned,
delegated and transferred to the Assignee, and the Assignee has purchased,
accepted and assumed from the Assignor, the percentage interest specified in
Item 3 of Schedule 1 of all outstandings, rights and obligations under the
Credit Agreement relating to the facilities listed in Item 3 of Schedule 1. The
"Effective Date" of the Assignment shall be the later of the date specified in
Item 4 of Schedule 1 or two Business Days (or such shorter period as agreed to
by the Agent) after this Notice of Assignment and any consents and other
documents required by Sections 12.3 of the Credit Agreement have been delivered
to the Agent, provided that the Effective Date shall not occur if any condition
precedent agreed to by the Assignor and the Assignee has not been satisfied.
Exhibit F Page 10
XVIII The Assignor and the Assignee hereby give to the Company and the
Agent notice of the assignment and delegation referred to herein. The Assignor
will confer with the Agent before the date specified in Item 4 of Schedule 1 to
determine if the Assignment Agreement will become effective on such date
pursuant to Section 3 hereof, and will confer with the Agent to determine the
Effective Date pursuant to Section 3 hereof if it occurs thereafter. The
Assignor shall notify the Agent if the Assignment Agreement does not become
effective on any proposed Effective Date as a result of the failure to satisfy
the conditions precedent agreed to by the Assignor and the Assignee. At the
request of the Agent, the Assignor will give the Agent written confirmation of
the satisfaction of the conditions precedent.
XIX If Notes are outstanding on the Effective Date, the Assignor and the
Assignee request and direct that the Agent prepare and cause the Company to
execute and deliver new Notes or, as appropriate, replacement notes, to the
Assignor and the Assignee. The Assignor and, if applicable, the Assignee each
agree to deliver to the Agent the original Note received by it from the Company
upon its receipt of a new Note in the appropriate amount.
XX The Assignee advises the Agent that notice and payment instructions are
set forth in the attachment to Schedule 1.
XXI The Assignee hereby represents and warrants that none of the funds,
monies, assets or other consideration being used to make the purchase pursuant
to the Assignment are "plan assets" as defined under ERISA and that its rights,
benefits, and interest in and under the Loan Documents will not be "plan assets"
under ERISA.
XXII The Assignee authorizes the Agent to act as its agent under the Loan
Documents in accordance with the terms thereof. The Assignee acknowledges that
the Agent has no duty to supply information with respect to the Company or the
Loan Documents to the Assignee until the Assignee becomes a party to the Credit
Agreement.
[ASSIGNOR]
By:
------------------------------
Name:
-----------------------------
Title:
----------------------------
[ASSIGNEE]
Exhibit F Page 11
By:
-------------------------------
Name:
-----------------------------
Title:
----------------------------
[Attach photocopy of Schedule I to Assignment Agreement]
Exhibit F Page ▇▇
▇▇▇▇▇▇▇ "▇"
(▇▇ Credit Agreement)
NOTICE OF COMMITMENT INCREASE
Canadian Imperial Bank of Commerce
▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇ ▇▇▇▇
Reference is made to the Letter of Credit Facility Agreement, dated as
September 1, 1996, among NGC Corporation, a Delaware corporation, as Borrower
(the "Borrower"), the Lenders (parties thereto), and Canadian Imperial Bank of
Commerce, as Agent (as amended, modified and supplemented to the date hereof,
the "Credit Agreement"). Capitalized terms used herein but not otherwise
defined have the meanings assigned to them in the Credit Agreement. The
undersigned hereby gives notice pursuant to Section 2.21 of the Credit Agreement
of its intent to increase the Aggregate Commitment by the amount of $ ,
effective , 19 (the "Commitment Increase Effective Date"). The
existing Lenders agreeing to increase their commitments and the assignees
agreeing to become New Lenders to effect such requested increase are identified
below.
From and after the Commitment Increase Effective Date, the respective
Commitments of the existing Lenders agreeing to increase their commitments and
the New Lenders will be as set forth below:
Stated Amount of
Outstanding Letters
Existing Lenders: Percentage:/1/ of Credit: Commitment:
% $ $
------------------ ---------------- ---------- -----------
% $ $
------------------ ---------------- ---------- -----------
% $ $
------------------ ---------------- ---------- -----------
--------------
/5/ If any existing Lender's Percentage changes or if any New Lenders are
shown hereon, the Borrower should attach a CUSA Certificate.
Exhibit G Page 1
% $ $
------------------ ---------------- ---------- -----------
% $ $
------------------ ---------------- ---------- -----------
% $ $
------------------ ---------------- ---------- -----------
% $ $
------------------ ---------------- ---------- ------------
Stated Amount of
Outstanding Letters
New Lenders: Percentage: of Credit: Commitment:
% $ $
------------------ ---------------- ---------- ------------
% $ $
------------------ ---------------- ---------- ------------
% $ $
------------------ ---------------- ---------- ------------
% $ $
------------------ ---------------- ---------- ------------
% $ $
------------------ ---------------- ---------- ------------
% $ $
------------------ ---------------- ---------- ------------
% $ $
------------------ ---------------- ---------- ------------
The undersigned Authorized Officer represents and warrants that (a)
the increase requested hereby complies with the requirements of Section 2.21 of
the Credit Agreement and (b) except [as set forth on Annex A hereto, and]/1/ to
the extent the undersigned gives notice to the Agent to the contrary prior to
5:00 p.m., (Chicago time) on the Business Day before the Commitment Increase
Effective Date, no Default or Unmatured Default exists as of the date hereof and
no Default will exist on the Commitment Increase Effective Date.
NGC CORPORATION
--------------
/6/ If the representation and warranty in clause (b) would be incorrect, include
the material in the brackets and set forth the reasons such representation
and warranty would be incorrect on an attachment labeled Annex A.
Exhibit G Page 2
By:
--------------------------------------
Name:
------------------------------------
Title:
----------------------------------
Exhibit G Page 3
EXHIBIT "H-1"
(to Credit Agreement)
GUARANTY AGREEMENT
------------------
Guaranty Agreement dated as of September 1, 1996 (this "Guaranty
Agreement") executed and delivered by _____________________, a
___________________________, (the "Guarantor") in favor of Canadian Imperial
Bank of Commerce, as agent for the pro rata benefit of lenders party to that
certain Letter of Credit Facility Agreement dated as of September 1, 1996 (as
amended, supplemented or otherwise modified from time to time, the "Credit
Agreement") among NGC Corporation, a Delaware corporation, each of the entities
which is a party thereto as a lender (the "Lenders"), and Canadian Imperial Bank
of Commerce, as agent for itself and the other lenders party thereto.
1. Capitalized terms used herein and not otherwise defined shall have the
meanings assigned to them in the Credit Agreement.
2. In order to induce the Lenders to make Loans to the Borrower and issue
Letters of Credit for the account of the Borrower, the Guarantor hereby requests
the Lenders to extend credit or to permit credit to remain outstanding under the
Credit Agreement to the Borrower as the Borrower may desire and as the Lenders
may extend or permit from time to time under the Credit Agreement, and, in
consideration of any credit granted or continued to the Borrower under the
Credit Agreement, the Guarantor hereby absolutely, irrevocably and
unconditionally guarantees prompt payment when due, whether at stated maturity,
upon acceleration or otherwise, and at all times thereafter, of any and all
existing and future obligations, indebtedness and liabilities of every kind,
nature and character, direct or indirect, absolute or contingent (including (i)
all renewals, extensions and modifications thereof, (ii) all attorneys' fees
incurred by any Lender in connection with the collection or enforcement thereof,
and (iii) all such amounts which would become due but for the operation of the
automatic stay under Section 362(a) of the United States Bankruptcy Code, 11
U.S.C. (S) 362(a) and the operation of Sections 502(b) of the United States
Bankruptcy Code, 11 U.S.C. (S)(S) 502(b) and including all amounts in respect of
indemnity by the Borrower of any Lender or the Agent), of the Borrower to any of
the Lenders or the Agent under or with respect to the Credit Agreement, any Note
issued pursuant to the Credit Agreement, any unpaid reimbursement obligations
with respect to any amounts paid by Lenders pursuant to any Letters of Credit or
any Letter of Credit issued pursuant to the Credit Agreement, including, without
limitation, all of the Obligations (the "Guaranteed Debt").
3. The Guarantor hereby waives notice of the acceptance of its guaranty
of the Guaranteed Debt set forth in this Guaranty Agreement and of the extension
or continuation of the
Exhibit H-1 Page 1
Guaranteed Debt or any part thereof. The Guarantor further waives presentment,
protest, notice, demand or action on delinquency in respect of the Guaranteed
Debt or any part thereof, including any right to require any Lender or the Agent
to ▇▇▇ the Borrower, any other guarantor or any other Person obligated with
respect to the Guaranteed Debt or any part thereof, or otherwise to enforce
payment thereof against any collateral, if any, securing the Guaranteed Debt or
any part thereof.
4. Credit may be granted or continued from time to time by the Lenders to
the Borrower without notice to or authorization from the Guarantor regardless of
the financial or other condition of the Borrower at the time of any such grant
or continuation. Neither the Agent nor any of the Lenders shall have any
obligation to disclose or discuss with the Guarantor its assessment of the
financial condition of the Borrower.
5. The Guarantor hereby also guarantees that all of the Guaranteed Debt
will be paid strictly in accordance with the terms of the Credit Agreement and
the other Loan Documents regardless of any law, regulation or order now or
hereafter in effect in any jurisdiction affecting any of such Guaranteed Debt or
the rights of any Lender or the Agent with respect thereto. The Guarantor's
guaranty of the Guaranteed Debt set forth in this Guaranty Agreement is a
guaranty of payment and not of collection, is a primary obligation of the
Guarantor and not one of surety, and the validity and enforceability of this
Guaranty Agreement and the liability of the Guarantor hereunder shall be
absolute and unconditional irrespective of, and shall not be impaired or
affected by, any of the following: (i) any extension, modification or renewal
of, or indulgence with respect to, or substitutions for, the Guaranteed Debt, or
any part thereof, or any agreement relating thereto at any time; (ii) any
failure or omission to enforce any right, power or remedy with respect to the
Guaranteed Debt, or any part thereof, or any agreement relating thereto, or any
collateral securing the Guaranteed Debt or any part thereof; (iii) any waiver of
any right, power or remedy or of any default with respect to the Guaranteed
Debt, or any part thereof, or any agreement relating thereto or with respect to
any collateral securing the Guaranteed Debt or any part thereof; (iv) any
release, surrender, compromise, settlement, waiver, subordination or
modification, with or without consideration, of any collateral securing the
Guaranteed Debt, or any part thereof, any other guaranties with respect to the
Guaranteed Debt or any part thereof, or any other obligation of any Person or
entity with respect to the Guaranteed Debt or any part thereof; (v) the
enforceability or validity of the Guaranteed Debt or any part thereof or the
genuineness, enforceability or validity of any agreement relating thereto or
with respect to any collateral securing the Guaranteed Debt or any part thereof;
(vi) the application of payments received from any source to the payment of
indebtedness other than the Guaranteed Debt, any part thereof or amounts which
are not covered by this Guaranty Agreement even though any of the Lenders might
lawfully have elected to apply such payments to any part or all of the
Guaranteed Debt or to amounts which are not covered by this Guaranty Agreement;
(vii) any change of ownership of any Obligor; (viii) the insolvency, bankruptcy
or any other change in the
Exhibit H-1 Page 2
legal status of any Obligor (or the retirement, death, or dissolution of any
partner or the introduction of any further partner of any Obligor); (ix) any
change in or the imposition of any law, decree, regulation or other governmental
act which does or might impair, delay or in any way affect the validity,
enforceability or the payment when due of any of the Guaranteed Debt; (x) any
failure of any Obligor to maintain in full force, validity or effect or to
obtain or renew when required all governmental and other approvals, licenses or
consents required in connection with the Guaranteed Debt, or to take any other
action required in connection with the performance of its obligations with
respect to the Guaranteed Debt; (xi) the existence of any claim, setoff or other
rights which the Guarantor may have at any time against any Obligor in
connection with the Guaranteed Debt, the Credit Agreement or any unrelated
transaction; (xii) any other circumstance (other than a payment of the
Guaranteed Debt which is not rescinded or otherwise returned by any Lender or
the Agent upon the insolvency, bankruptcy or reorganization of any Obligor, or
otherwise) which might otherwise constitute a defense available to, or a
discharge of, any Obligor in respect of the Guaranteed Debt; or (xiii) any other
circumstance which might otherwise constitute a defense available to, or a
discharge of, the Guarantor in respect of its obligations under this Guaranty
Agreement, all whether or not the Guarantor shall have had notice or knowledge
of any act or omission referred to in the foregoing clauses (i) through (xiii)
of this Guaranty Agreement. It is agreed that the Guarantor's liability under
this Guaranty Agreement is several and independent of any other guaranties or
other obligations at any time in effect with respect to the Guaranteed Debt or
any part thereof and that the Guarantor's liability under this Guaranty
Agreement may be enforced regardless of the existence, validity, enforcement or
non-enforcement of any such other guaranties or other obligations or any
provision of any applicable law or regulation purporting to prohibit payment by
such Obligor of the Guaranteed Debt in the manner agreed upon in this Guaranty
Agreement.
6. In the event that acceleration of the time for payment of any of the
Guaranteed Debt is stayed, upon the insolvency, bankruptcy or reorganization of
the Borrower, or otherwise, all such amounts shall nonetheless be payable by the
Guarantor forthwith upon demand.
7. The guaranty of the Guarantor set forth in this Guaranty Agreement
shall continue in effect, notwithstanding any extensions, modifications,
renewals or indulgences with respect to, or substitution for, the Guaranteed
Debt or any part thereof, until all of the Guaranteed Debt shall have been paid
in full, all Commitments shall have terminated or expired and all of the Letters
of Credit shall have expired or been terminated in accordance with their
respective terms. The guaranty of the Guarantor set forth in this Guaranty
Agreement shall also continue to be effective or be reinstated, as the case may
be, if at any time any payment of the Guaranteed Debt, or any part thereof, is
rescinded or must otherwise be returned by any Lender or the Agent upon the
insolvency, bankruptcy or reorganization of the Borrower, or otherwise, all as
though such payment had not been made.
Exhibit H-1 Page 3
8. The Guarantor hereby waives any claim, as that term is defined in the
Bankruptcy Code, that the Guarantor might now have or hereafter acquire against
the Borrower that arises from the existence or performance of the Guarantor's
obligations under its guaranty of the Guaranteed Debt set forth in this Guaranty
Agreement until the Guaranteed Debt has been paid in full.
9. The Guarantor hereby waives any benefit of the collateral, if any,
which may from time to time secure the Guaranteed Debt or any part thereof and
authorizes the Agent and the Lenders to take any action or exercise any remedy
with respect thereto, which the Agent or the Lenders in its or their sole
discretion shall determine, without notice to the Guarantor. In the event the
Agent or any Lender in its sole discretion elects to give notice of any action
with respect to the collateral, if any, securing the Guaranteed Debt or any part
thereof, ten days' written notice mailed to the Guarantor by ordinary mail at
the address shown hereon shall be deemed reasonable notice of any matters
contained in such notice.
10. It is understood that while the amount of the Guaranteed Debt is not
limited, the liability of the Guarantor under the Guaranty Agreement shall not
at any time exceed an amount equal to the lesser of (i) the Guaranteed Debt at
such time, and (ii) the Maximum Amount (as defined below). As used herein, the
"Maximum Amount" means the greater of (A) 95% of the Guarantor's Net Worth (as
defined below) as of the Closing Date, and (B) 95% of the Guarantor's largest
Net Worth determined from time to time subsequent to the Closing Date. As used
herein, the "Net Worth" of the Guarantor as of any date of determination means
the amount by which the aggregate amount of the Guarantor's assets and property
as of such date of determination are greater than the aggregate amount of the
Guarantor's debts and other obligations (excluding any portion of the Guaranteed
Debt for which the Guarantor is liable only because of its guaranty set forth in
this Guaranty Agreement) as of such date of determination, at fair valuation and
after giving effect to the inclusion and exclusion of the matters included and
excluded in determining whether a debtor is solvent according to Section 548 of
the Bankruptcy Code and the Illinois Uniform Fraudulent Transfer Act, Ill. ▇▇▇.
Stat. ch. 59, (S)101 et seq. (▇▇▇▇▇-▇▇▇▇ 1991).
11. The Guarantor represents and warrants to the Agent and each Lender as
follows:
(a) The Guarantor is a corporation duly organized, validly existing and in
good standing under the laws of the states of its incorporation, is qualified to
do business in all jurisdictions in which the nature of the business conducted
by it makes such qualification necessary and where failure to so qualify would
have a Material Adverse Effect.
Exhibit H-1 Page 4
(b) The Guarantor has the corporate power and authority to execute, deliver
and perform its obligations under this Guaranty Agreement and this Guaranty
Agreement constitutes the legal, valid and binding obligation of the Guarantor,
enforceable against the Guarantor in accordance with its terms, except as
enforceability may be limited by bankruptcy, insolvency or similar laws
affecting the enforcement of creditors' rights generally.
(c) The execution, delivery and performance by the Guarantor of this
Guaranty Agreement have been duly authorized by all requisite action on the part
of the Guarantor and do not and will not violate the charter or certificate or
articles of incorporation or bylaws of the Guarantor or any law or any order of
any Tribunal and do not and will not conflict with, result in a breach of, or
constitute a default under, or result in the imposition of any Lien upon any
assets of the Guarantor pursuant to the provisions of any indenture, mortgage,
deed of trust, security agreement, franchise, permit, license, or other
instrument or agreement that is a Material Agreement to which the Guarantor or
its properties is bound.
(d) No authorization, approval, or consent of, and no filing or
registration with, any tribunal or third party is necessary for the execution,
delivery or performance by the Guarantor of this Guaranty Agreement or the
validity or enforceability thereof or to the extent that any such consent or
other action may be required it has been validly procured and all waiting
periods with respect thereto have expired.
(e) The business and prospects for success of the Borrower and the
Guarantor are interrelated and as a result (i) the improvement in the financial
condition and operations of the Borrower resulting from the Loans and Letters of
Credit made to or issued for the account of the Borrower under the Credit
Agreement will substantially benefit the business of the Guarantor and (ii) it
is desirable and in the best interests of the Guarantor that the Borrower be
able to obtain Loans and Letters of Credit under the Credit Agreement.
(f) The Guarantor and the Borrower have agreed that the Borrower will from
time to time provide various management, marketing, operational and other
consulting services to the Guarantor which are necessary for the continuation of
the Guarantor's business, and the Loans and Letters of Credit provided to the
Borrower under the Credit Agreement improve the Borrower's ability to provide
the Guarantor with management, marketing, operational and other consulting
services which are necessary for the continuation of the Guarantor's business
and therefore substantially benefit the Guarantor.
Exhibit H-1 Page 5
12. The Guarantor covenants and agrees that, until all of the Guaranteed
Debt shall have been paid in full, all Commitments shall have terminated or
expired and all of the Letters of Credit shall have expired or been terminated
in accordance with their respective terms, (i) the Guarantor will comply with
all of the covenants of the Borrower set forth in Article VI of the Credit
Agreement to the extent that such covenants apply to any action of the
Guarantor, and (ii) the Guarantor will not violate any of the covenants of the
Borrower set forth in Article VI of the Credit Agreement to the extent that such
covenants limit any action of the Guarantor.
13. Each Lender shall have the right to set off and apply against the
obligations of the Guarantor under this Guaranty Agreement or the Guaranteed
Debt or both in such manner as such Person may determine, at any time after the
occurrence and during the continuance of a Default and without notice to the
Guarantor, any and all deposits (general, time or demand, provisional or final)
or other sums at any time credited by or owing from such Lender to the Guarantor
irrespective of whether or not the Agent shall have made any demand under this
Guaranty Agreement. The rights and remedies of each Lender hereunder are in
addition to other rights and remedies (including, without limitation, other
rights of setoff) which each Lender may have.
14. This Guaranty Agreement is for the benefit of the Agent, for the pro
rata benefit of the Lenders, and their successors and assigns, and in the event
of an assignment of the Guaranteed Debt, or any part thereof, the rights and
benefits hereunder, to the extent applicable to the indebtedness so assigned,
may be transferred with such indebtedness. This Guaranty Agreement is binding
not only on the Guarantor, but on the Guarantor's successors and assigns.
15. The Guarantor recognizes that the Lenders are relying upon this
Guaranty Agreement and the undertakings of the Guarantor hereunder in making
Advances to the Borrower under the Credit Agreement, and in issuing Letters of
Credit for the account of the Borrower under the Credit Agreement and further
recognizes that the execution and delivery of this Guaranty Agreement is a
material inducement to the Lenders in continuing to make such Advances and issue
such Letters of Credit. The Guarantor hereby acknowledges that there are no
conditions other than those expressly set forth herein to the full effectiveness
of this Guaranty Agreement.
16. Any notice, consent, or other communication required or permitted to
be given under this Guaranty Agreement to the Agent or the Guarantor must be in
writing and delivered in person, by telex or by facsimile or mailed with postage
prepaid, as follows:
To the Agent: Canadian Imperial Bank of Commerce
▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Exhibit H-1 Page 6
Attention: ▇▇▇▇ ▇▇▇▇
Telephone No.: ▇▇▇-▇▇▇-▇▇▇▇
Telecopy No.: ▇▇▇-▇▇▇-▇▇▇▇
To the Guarantor:
-------------------------
▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Attn: Chief Financial Officer
Telephone No.: ▇▇▇-▇▇▇-▇▇▇▇
Telecopy No.: ▇▇▇-▇▇▇-▇▇▇▇
with a copy to:
Attn: General Counsel
Any notice, if mailed and properly addressed with postage prepaid, shall be
deemed given when received; any notice, if transmitted by telex or facsimile,
shall be deemed given when transmitted on any Business Day (answerback confirmed
in the case of telexes). The Guarantor and the Agent may each change the
address for service of notice upon it by a notice in writing to the other party
hereto.
17. THIS GUARANTY AGREEMENT SHALL BE DEEMED TO HAVE BEEN MADE AND TO BE
PERFORMABLE IN CHICAGO, ▇▇▇▇ COUNTY, ILLINOIS, AND SHALL BE CONSTRUED IN
ACCORDANCE WITH THE INTERNAL LAWS (AND NOT THE LAW OF CONFLICTS) OF THE STATE OF
ILLINOIS, BUT GIVING EFFECT TO FEDERAL LAWS APPLICABLE TO NATIONAL BANKS AND THE
APPLICABLE LAWS OF THE UNITED STATES OF AMERICA.
18. The parties hereto acknowledge and agree that this Guaranty Agreement
shall not be construed more favorably in favor of one than the other based upon
which party drafted the same, it being acknowledged that all parties hereto
contributed substantially to the negotiation and preparation of this Guaranty
Agreement.
19. The Credit Agreement, and all of the terms thereof, are incorporated
herein by reference, the same as if stated verbatim herein, and the Guarantor
agrees that the Agent and the Lenders may exercise any and all Rights granted to
it or them under the Credit Agreement and the other Loan Documents without
affecting the validity or enforceability of this Guaranty Agreement.
Exhibit H-1 Page 7
20. In the event that any provision of this Guaranty Agreement is
irreconcilably inconsistent with any specific provision of the Credit Agreement,
the provision of the Credit Agreement shall control.
21. The Guarantor hereby represents and warrants to the Agent and the
Lenders that the Guarantor has adequate means to obtain from the Borrower on a
continuing basis information concerning the financial condition and assets of
the Borrower that the Guarantor is not relying upon the Agent or any of the
Lenders to provide (and the Agent and the Lenders shall have no duty to provide)
any such information to the Guarantor either now or in the future.
22. This Guaranty Agreement embodies the final, entire agreement of the
Guarantor, the Agent and the Lenders with respect to the Guarantor's guaranty of
the Guaranteed Indebtedness and supersedes any and all prior commitments,
agreements, representations, and understandings, whether written or oral,
relating to the subject matter hereof. This Guaranty Agreement is intended by
the Guarantor and the Agent as a final and complete expression of the terms of
the Guarantor's guaranty of the Guaranteed Indebtedness, and no course of
dealing between the Guarantor and the Agent or any Lender, no course of
performance, no trade practices, and no parol or extrinsic evidence of any
nature shall be used to supplement or modify any term of this Guaranty
Agreement.
23. THIS GUARANTY AGREEMENT SHALL BE CONSTRUED IN ACCORDANCE WITH THE
INTERNAL LAWS (AND NOT THE LAW OF CONFLICTS OF LAWS) OF THE STATE OF ILLINOIS,
BUT GIVING EFFECT TO FEDERAL LAWS APPLICABLE TO NATIONAL BANKS.
24. THE GUARANTOR HEREBY IRREVOCABLY SUBMITS TO THE NON-EXCLUSIVE
JURISDICTION OF ANY UNITED STATES FEDERAL OR ILLINOIS STATE COURT SITTING IN
CHICAGO IN ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS GUARANTY
AGREEMENT OR ANY OTHER LOAN DOCUMENTS AND THE GUARANTOR HEREBY IRREVOCABLY
AGREES THAT ALL CLAIMS IN RESPECT OF SUCH ACTION OR PROCEEDING MAY BE HEARD AND
DETERMINED IN ANY SUCH COURT AND IRREVOCABLY WAIVES ANY OBJECTION IT MAY NOW OR
HEREAFTER HAVE AS TO THE VENUE OF ANY SUCH SUIT, ACTION OR PROCEEDING BROUGHT IN
SUCH A COURT OR THAT SUCH COURT IS AN INCONVENIENT FORUM. NOTHING HEREIN SHALL
LIMIT THE RIGHT OF THE AGENT OR ANY LENDER TO BRING PROCEEDINGS AGAINST THE
GUARANTOR IN THE COURTS OF ANY OTHER JURISDICTION.
25. THE GUARANTOR, THE AGENT AND EACH LENDER HEREBY WAIVE TRIAL BY JURY IN
ANY JUDICIAL PROCEEDING INVOLVING, DIRECTLY OR
Exhibit H-1 Page 8
INDIRECTLY, ANY MATTER (WHETHER SOUNDING IN TORT, CONTRACT OR OTHERWISE) IN ANY
WAY ARISING OUT OF, RELATED TO, OR CONNECTED WITH THIS GUARANTY AGREEMENT, OR
THE RELATIONSHIP ESTABLISHED HEREUNDER.
Exhibit H-1 Page 9
IN WITNESS WHEREOF, the Guarantor and the Agent have executed this Guaranty
Agreement as of the date first above written.
[GUARANTOR]
By: ______________________________
Name: ____________________________
Title: ___________________________
CANADIAN IMPERIAL BANK OF COMMERCE,
as Agent
By: ______________________________
Name: ____________________________
Title: ___________________________
Exhibit H-1 Page 10
EXHIBIT "H-2"
(to Credit Agreement)
GUARANTY AGREEMENT
------------------
Guaranty Agreement dated as of September 1, 1996 (this "Guaranty
Agreement") executed and delivered by _________________________, a
_______________________ (the "Guarantor") in favor of Canadian Imperial Bank of
Commerce , as agent for the pro rata benefit of lenders party to that certain
Letter of Credit Facility Agreement dated as of September 1, 1996 (as amended,
supplemented or otherwise modified from time to time, the "Credit Agreement")
among NGC Corporation, a Delaware corporation, each of the entities which is a
party thereto as a lender (the "Lenders"), and Canadian Imperial Bank of
Commerce, as agent for itself and the other lenders party thereto.
1. Capitalized terms used herein and not otherwise defined shall have the
meanings assigned to them in the Credit Agreement.
2. In order to induce the Lenders to make Loans to the Borrower and issue
Letters of Credit for the account of the Borrower, the Guarantor hereby requests
the Lenders to extend credit or to permit credit to remain outstanding under the
Credit Agreement to the Borrower as the Borrower may desire and as the Lenders
may extend or permit from time to time under the Credit Agreement, and, in
consideration of any credit granted or continued to the Borrower under the
Credit Agreement, the Guarantor hereby absolutely, irrevocably and
unconditionally guarantees prompt payment when due, whether at stated maturity,
upon acceleration or otherwise, and at all times thereafter, of any and all
existing and future obligations, indebtedness and liabilities of every kind,
nature and character, direct or indirect, absolute or contingent (including (i)
all renewals, extensions and modifications thereof, (ii) all attorneys' fees
incurred by any Lender in connection with the collection or enforcement thereof,
and (iii) all such amounts which would become due but for the operation of the
automatic stay under Section 362(a) of the United States Bankruptcy Code, 11
U.S.C. (S) 362(a) and the operation of Sections 502(b) of the United States
Bankruptcy Code, 11 U.S.C. (S)(S) 502(b) and including all amounts in respect of
indemnity by the Borrower of any Lender or the Agent), of the Borrower to any of
the Lenders or the Agent under or with respect to the Credit Agreement, any Note
issued pursuant to the Credit Agreement, or any Letter of Credit issued pursuant
to the Credit Agreement, including, without limitation, all of the Obligations
(the "Guaranteed Debt").
3. The Guarantor hereby waives notice of the acceptance of its guaranty
of the Guaranteed Debt set forth in this Guaranty Agreement and of the extension
or continuation of the Guaranteed Debt or any part thereof. The Guarantor
further waives presentment, protest, notice,
Exhibit H-2 Page 1
demand or action on delinquency in respect of the Guaranteed Debt or any part
thereof, including any right to require any Lender or the Agent to ▇▇▇ the
Borrower, any other guarantor or any other Person obligated with respect to the
Guaranteed Debt or any part thereof, or otherwise to enforce payment thereof
against any collateral, if any, securing the Guaranteed Debt or any part
thereof.
4. Credit may be granted or continued from time to time by the Lenders to
the Borrower without notice to or authorization from the Guarantor regardless of
the financial or other condition of the Borrower at the time of any such grant
or continuation. Neither the Agent nor any of the Lenders shall have any
obligation to disclose or discuss with the Guarantor its assessment of the
financial condition of the Borrower.
5. The Guarantor hereby also guarantees that all of the Guaranteed Debt
will be paid strictly in accordance with the terms of the Credit Agreement and
the other Loan Documents regardless of any law, regulation or order now or
hereafter in effect in any jurisdiction affecting any of such Guaranteed Debt or
the rights of any Lender or the Agent with respect thereto. The Guarantor's
guaranty of the Guaranteed Debt set forth in this Guaranty Agreement is a
guaranty of payment and not of collection, is a primary obligation of the
Guarantor and not one of surety, and the validity and enforceability of this
Guaranty Agreement and the liability of the Guarantor hereunder shall be
absolute and unconditional irrespective of, and shall not be impaired or
affected by, any of the following: (i) any extension, modification or renewal
of, or indulgence with respect to, or substitutions for, the Guaranteed Debt, or
any part thereof, or any agreement relating thereto at any time; (ii) any
failure or omission to enforce any right, power or remedy with respect to the
Guaranteed Debt, or any part thereof, or any agreement relating thereto, or any
collateral securing the Guaranteed Debt or any part thereof; (iii) any waiver of
any right, power or remedy or of any default with respect to the Guaranteed
Debt, or any part thereof, or any agreement relating thereto or with respect to
any collateral securing the Guaranteed Debt or any part thereof; (iv) any
release, surrender, compromise, settlement, waiver, subordination or
modification, with or without consideration, of any collateral securing the
Guaranteed Debt, or any part thereof, any other guaranties with respect to the
Guaranteed Debt or any part thereof, or any other obligation of any Person or
entity with respect to the Guaranteed Debt or any part thereof; (v) the
enforceability or validity of the Guaranteed Debt or any part thereof or the
genuineness, enforceability or validity of any agreement relating thereto or
with respect to any collateral securing the Guaranteed Debt or any part thereof;
(vi) the application of payments received from any source to the payment of
indebtedness other than the Guaranteed Debt, any part thereof or amounts which
are not covered by this Guaranty Agreement even though any of the Lenders might
lawfully have elected to apply such payments to any part or all of the
Guaranteed Debt or to amounts which are not covered by this Guaranty Agreement;
(vii) any change of ownership of any Obligor; (viii) the insolvency, bankruptcy
or any other change in the legal status of any Obligor (or the retirement,
death, or dissolution of any partner or the
Exhibit H-2 Page 2
introduction of any further partner of any Obligor); (ix) any change in or the
imposition of any law, decree, regulation or other governmental act which does
or might impair, delay or in any way affect the validity, enforceability or the
payment when due of any of the Guaranteed Debt; (x) any failure of any Obligor
to maintain in full force, validity or effect or to obtain or renew when
required all governmental and other approvals, licenses or consents required in
connection with the Guaranteed Debt, or to take any other action required in
connection with the performance of its obligations with respect to the
Guaranteed Debt; (xi) the existence of any claim, setoff or other rights which
the Guarantor may have at any time against any Obligor in connection with the
Guaranteed Debt, the Credit Agreement or any unrelated transaction; (xii) any
other circumstance (other than a payment of the Guaranteed Debt which is not
rescinded or otherwise returned by any Lender or the Agent upon the insolvency,
bankruptcy or reorganization of any Obligor, or otherwise) which might otherwise
constitute a defense available to, or a discharge of, any Obligor in respect of
the Guaranteed Debt; or (xiii) any other circumstance which might otherwise
constitute a defense available to, or a discharge of, the Guarantor in respect
of its obligations under this Guaranty Agreement, all whether or not the
Guarantor shall have had notice or knowledge of any act or omission referred to
in the foregoing clauses (i) through (xiii) of this Guaranty Agreement. It is
agreed that the Guarantor's liability under this Guaranty Agreement is several
and independent of any other guaranties or other obligations at any time in
effect with respect to the Guaranteed Debt or any part thereof and that the
Guarantor's liability under this Guaranty Agreement may be enforced regardless
of the existence, validity, enforcement or non-enforcement of any such other
guaranties or other obligations or any provision of any applicable law or
regulation purporting to prohibit payment by such Obligor of the Guaranteed Debt
in the manner agreed upon in this Guaranty Agreement.
6. In the event that acceleration of the time for payment of any of the
Guaranteed Debt is stayed, upon the insolvency, bankruptcy or reorganization of
the Borrower, or otherwise, all such amounts shall nonetheless be payable by the
Guarantor forthwith upon demand.
7. The guaranty of the Guarantor set forth in this Guaranty Agreement
shall continue in effect, notwithstanding any extensions, modifications,
renewals or indulgences with respect to, or substitution for, the Guaranteed
Debt or any part thereof, until all of the Guaranteed Debt shall have been paid
in full, all Commitments shall have terminated or expired and all of the Letters
of Credit shall have expired or been terminated in accordance with their
respective terms. The guaranty of the Guarantor set forth in this Guaranty
Agreement shall also continue to be effective or be reinstated, as the case may
be, if at any time any payment of the Guaranteed Debt, or any part thereof, is
rescinded or must otherwise be returned by any Lender or the Agent upon the
insolvency, bankruptcy or reorganization of the Borrower, or otherwise, all as
though such payment had not been made.
Exhibit H-2 Page 3
8. The Guarantor hereby waives any claim, as that term is defined in the
Bankruptcy Code, that the Guarantor might now have or hereafter acquire against
the Borrower that arises from the existence or performance of the Guarantor's
obligations under its guaranty of the Guaranteed Debt set forth in this Guaranty
Agreement until the Guaranteed Debt has been paid in full.
9. The Guarantor hereby waives any benefit of the collateral, if any,
which may from time to time secure the Guaranteed Debt or any part thereof and
authorizes the Agent and the Lenders to take any action or exercise any remedy
with respect thereto, which the Agent or the Lenders in its or their sole
discretion shall determine, without notice to the Guarantor. In the event the
Agent or any Lender in its sole discretion elects to give notice of any action
with respect to the collateral, if any, securing the Guaranteed Debt or any part
thereof, ten days' written notice mailed to the Guarantor by ordinary mail at
the address shown hereon shall be deemed reasonable notice of any matters
contained in such notice.
10. It is understood that while the amount of the Guaranteed Debt is not
limited, the liability of the Guarantor under the Guaranty Agreement shall not
at any time exceed an amount equal to the lesser of (i) the Guaranteed Debt at
such time, and (ii) the Maximum Amount (as defined below) and (iii) the
Subordination Amount (as defined below). As used herein, the "Maximum Amount"
means the greater of (A) 95% of the Guarantor's Net Worth (as defined below) as
of the Closing Date, and (B) 95% of the Guarantor's largest Net Worth determined
from time to time subsequent to the Closing Date. As used herein, the "Net
Worth" of the Guarantor as of any date of determination means the amount by
which the aggregate amount of the Guarantor's assets and property as of such
date of determination are greater than the aggregate amount of the Guarantor's
debts and other obligations (excluding any portion of the Guaranteed Debt for
which the Guarantor is liable only because of its guaranty set forth in this
Guaranty Agreement) as of such date of determination, at fair valuation and
after giving effect to the inclusion and exclusion of the matters included and
excluded in determining whether a debtor is solvent according to Section 548 of
the Bankruptcy Code and the Illinois Uniform Fraudulent Transfer Act, Ill. ▇▇▇.
Stat. ch. 59, (S)101 et seq. (▇▇▇▇▇-▇▇▇▇ 1991). As used hereunder, the
"Subordination Amount" means the maximum amount that the Guarantor can guaranty
hereunder without violating the terms and provisions of or causing a default
under either of the Existing Trident Indentures (as defined in the Credit
Agreement).
11. The Guarantor represents and warrants to the Agent and each Lender as
follows:
(a) The Guarantor is a corporation duly organized, validly existing and in
good standing under the laws of the states of its incorporation, is qualified to
do business in all jurisdictions in which the nature of the business conducted
by it makes such
Exhibit H-2 Page 4
qualification necessary and where failure to so qualify would have a Material
Adverse Effect.
(b) The Guarantor has the corporate power and authority to execute, deliver
and perform its obligations under this Guaranty Agreement and this Guaranty
Agreement constitutes the legal, valid and binding obligation of the Guarantor,
enforceable against the Guarantor in accordance with its terms, except as
enforceability may be limited by bankruptcy, insolvency or similar laws
affecting the enforcement of creditors' rights generally.
(c) The execution, delivery and performance by the Guarantor of this
Guaranty Agreement have been duly authorized by all requisite action on the part
of the Guarantor and do not and will not violate the charter or certificate or
articles of incorporation or bylaws of the Guarantor or any law or any order of
any Tribunal and do not and will not conflict with, result in a breach of, or
constitute a default under, or result in the imposition of any Lien upon any
assets of the Guarantor pursuant to the provisions of any indenture, mortgage,
deed of trust, security agreement, franchise, permit, license, or other
instrument or agreement that is a Material Agreement to which the Guarantor or
its properties is bound.
(d) No authorization, approval, or consent of, and no filing or
registration with, any tribunal or third party is necessary for the execution,
delivery or performance by the Guarantor of this Guaranty Agreement or the
validity or enforceability thereof or to the extent that any such consent or
other action may be required it has been validly procured and all waiting
periods with respect thereto have expired.
(e) The business and prospects for success of the Borrower and the
Guarantor are interrelated and as a result (i) the improvement in the financial
condition and operations of the Borrower resulting from the Loans and Letters of
Credit made to or issued for the account of the Borrower under the Credit
Agreement will substantially benefit the business of the Guarantor and (ii) it
is desirable and in the best interests of the Guarantor that the Borrower be
able to obtain Loans and Letters of Credit under the Credit Agreement.
(f) The Guarantor and the Borrower have agreed that the Borrower will from
time to time provide various management, marketing, operational and other
consulting services to the Guarantor which are necessary for the continuation of
the Guarantor's business, and the Loans and Letters of Credit provided to the
Borrower under the Credit Agreement improve the Borrower's ability to provide
the Guarantor with management,
Exhibit H-2 Page 5
marketing, operational and other consulting services which are necessary for the
continuation of the Guarantor's business and therefore substantially benefit the
Guarantor.
12. The Guarantor covenants and agrees that, until all of the Guaranteed
Debt shall have been paid in full, all Commitments shall have terminated or
expired and all of the Letters of Credit shall have expired or been terminated
in accordance with their respective terms, (i) the Guarantor will comply with
all of the covenants of the Borrower set forth in Article VI of the Credit
Agreement to the extent that such covenants apply to any action of the
Guarantor, and (ii) the Guarantor will not violate any of the covenants of the
Borrower set forth in Article VI of the Credit Agreement to the extent that such
covenants limit any action of the Guarantor. The Guarantor further covenants
and agrees not to amend or modify any of the Existing Trident Indentures in any
manner which would have the effect of reducing the amount that the Guarantor can
guaranty pursuant to this Guaranty without violating the terms and provisions of
any of the Existing Trident Indentures as in effect on the date hereof.
13. Each Lender shall have the right to set off and apply against the
obligations of the Guarantor under this Guaranty Agreement or the Guaranteed
Debt or both in such manner as such Person may determine, at any time after the
occurrence and during the continuance of a Default and without notice to the
Guarantor, any and all deposits (general, time or demand, provisional or final)
or other sums at any time credited by or owing from such Lender to the Guarantor
irrespective of whether or not the Agent shall have made any demand under this
Guaranty Agreement. The rights and remedies of each Lender hereunder are in
addition to other rights and remedies (including, without limitation, other
rights of setoff) which each Lender may have.
14. This Guaranty Agreement is for the benefit of the Agent, for the pro
rata benefit of the Lenders, and their successors and assigns, and in the event
of an assignment of the Guaranteed Debt, or any part thereof, the rights and
benefits hereunder, to the extent applicable to the indebtedness so assigned,
may be transferred with such indebtedness. This Guaranty Agreement is binding
not only on the Guarantor, but on the Guarantor's successors and assigns.
15. The Guarantor recognizes that the Lenders are relying upon this
Guaranty Agreement and the undertakings of the Guarantor hereunder in making
Advances to the Borrower under the Credit Agreement, and in issuing Letters of
Credit for the account of the Borrower under the Credit Agreement and further
recognizes that the execution and delivery of this Guaranty Agreement is a
material inducement to the Lenders in continuing to make such Advances and issue
such Letters of Credit. The Guarantor hereby acknowledges that there are no
conditions other than those expressly set forth herein to the full effectiveness
of this Guaranty Agreement.
Exhibit H-2 Page 6
16. Any notice, consent, or other communication required or permitted to
be given under this Guaranty Agreement to the Agent or the Guarantor must be in
writing and delivered in person, by telex or by facsimile or mailed with postage
prepaid, as follows:
To the Agent: Canadian Imperial Bank of Commerce
▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇ ▇▇▇▇
Telephone No.: ▇▇▇-▇▇▇-▇▇▇▇
Telecopy No.: ▇▇▇-▇▇▇-▇▇▇▇
To the Guarantor: __________________________________
▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Attn: Chief Financial Officer
Telephone No.: ▇▇▇-▇▇▇-▇▇▇▇
Telecopy No.: ▇▇▇-▇▇▇-▇▇▇▇
with a copy to:
Attn: General Counsel
Any notice, if mailed and properly addressed with postage prepaid, shall be
deemed given when received; any notice, if transmitted by telex or facsimile,
shall be deemed given when transmitted on any Business Day (answerback confirmed
in the case of telexes). The Guarantor and the Agent may each change the
address for service of notice upon it by a notice in writing to the other party
hereto.
17. THIS GUARANTY AGREEMENT SHALL BE DEEMED TO HAVE BEEN MADE AND TO BE
PERFORMABLE IN CHICAGO, ▇▇▇▇ COUNTY, ILLINOIS, AND SHALL BE CONSTRUED IN
ACCORDANCE WITH THE INTERNAL LAWS (AND NOT THE LAW OF CONFLICTS) OF THE STATE OF
ILLINOIS, BUT GIVING EFFECT TO FEDERAL LAWS APPLICABLE TO NATIONAL BANKS AND THE
APPLICABLE LAWS OF THE UNITED STATES OF AMERICA.
18. The parties hereto acknowledge and agree that this Guaranty Agreement
shall not be construed more favorably in favor of one than the other based upon
which party drafted the same, it being acknowledged that all parties hereto
contributed substantially to the negotiation and preparation of this Guaranty
Agreement.
Exhibit H-2 Page 7
19. The Credit Agreement, and all of the terms thereof, are incorporated
herein by reference, the same as if stated verbatim herein, and the Guarantor
agrees that the Agent and the Lenders may exercise any and all Rights granted to
it or them under the Credit Agreement and the other Loan Documents without
affecting the validity or enforceability of this Guaranty Agreement.
20. In the event that any provision of this Guaranty Agreement is
irreconcilably inconsistent with any specific provision of the Credit Agreement,
the provision of the Credit Agreement shall control.
21. The Guarantor hereby represents and warrants to the Agent and the
Lenders that the Guarantor has adequate means to obtain from the Borrower on a
continuing basis information concerning the financial condition and assets of
the Borrower that the Guarantor is not relying upon the Agent or any of the
Lenders to provide (and the Agent and the Lenders shall have no duty to provide)
any such information to the Guarantor either now or in the future.
22. This Guaranty Agreement embodies the final, entire agreement of the
Guarantor, the Agent and the Lenders with respect to the Guarantor's guaranty of
the Guaranteed Indebtedness and supersedes any and all prior commitments,
agreements, representations, and understandings, whether written or oral,
relating to the subject matter hereof. This Guaranty Agreement is intended by
the Guarantor and the Agent as a final and complete expression of the terms of
the Guarantor's guaranty of the Guaranteed Indebtedness, and no course of
dealing between the Guarantor and the Agent or any Lender, no course of
performance, no trade practices, and no parol or extrinsic evidence of any
nature shall be used to supplement or modify any term of this Guaranty
Agreement.
23. THIS GUARANTY AGREEMENT SHALL BE CONSTRUED IN ACCORDANCE WITH THE
INTERNAL LAWS (AND NOT THE LAW OF CONFLICTS OF LAWS) OF THE STATE OF ILLINOIS,
BUT GIVING EFFECT TO FEDERAL LAWS APPLICABLE TO NATIONAL BANKS.
24. THE GUARANTOR HEREBY IRREVOCABLY SUBMITS TO THE NON-EXCLUSIVE
JURISDICTION OF ANY UNITED STATES FEDERAL OR ILLINOIS STATE COURT SITTING IN
CHICAGO IN ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS GUARANTY
AGREEMENT OR ANY OTHER LOAN DOCUMENTS AND THE GUARANTOR HEREBY IRREVOCABLY
AGREES THAT ALL CLAIMS IN RESPECT OF SUCH ACTION OR PROCEEDING MAY BE HEARD AND
DETERMINED IN ANY SUCH COURT AND IRREVOCABLY WAIVES ANY OBJECTION IT MAY NOW OR
HEREAFTER HAVE AS TO THE VENUE OF ANY SUCH SUIT,
Exhibit H-2 Page 8
ACTION OR PROCEEDING BROUGHT IN SUCH A COURT OR THAT SUCH COURT IS AN
INCONVENIENT FORUM. NOTHING HEREIN SHALL LIMIT THE RIGHT OF THE AGENT OR ANY
LENDER TO BRING PROCEEDINGS AGAINST THE GUARANTOR IN THE COURTS OF ANY OTHER
JURISDICTION.
25. THE GUARANTOR, THE AGENT AND EACH LENDER HEREBY WAIVE TRIAL BY JURY IN
ANY JUDICIAL PROCEEDING INVOLVING, DIRECTLY OR INDIRECTLY, ANY MATTER (WHETHER
SOUNDING IN TORT, CONTRACT OR OTHERWISE) IN ANY WAY ARISING OUT OF, RELATED TO,
OR CONNECTED WITH THIS GUARANTY AGREEMENT, OR THE RELATIONSHIP ESTABLISHED
HEREUNDER.
Exhibit H-2 Page 9
IN WITNESS WHEREOF, the Guarantor and the Agent have executed this Guaranty
Agreement as of the date first above written.
[GUARANTOR]
By: _____________________________
Name: ___________________________
Title: __________________________
CANADIAN IMPERIAL BANK OF COMMERCE,
as Agent
By: _____________________________
Name: ___________________________
Title: __________________________
Exhibit H-2 Page 10
(Deliver Completed Form to Credit Support Staff For Immediate Processing)
SCHEDULE "1"
SUBSIDIARIES AND OTHER INVESTMENTS
(See Sections 5.8 and 6.2.6(iv))
Amount of Percent Jurisdiction of
Investment In Owned By Investment Ownership Organization
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Exhibit H-2 Page 11
SCHEDULE "2"
DEBT AND LIENS
(See Sections 5.14, 6.2.2(ii) and 6.2.8(ii))
Property Maturity and
Debt Incurred By Debt Owed To Encumbered (If Any) Amount of Debt
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Schedule 2 Page 1
SCHEDULE "3"
LITIGATION
(See Section 5.7)
None
Schedule 3 Page 1
SCHEDULE "4"
TRIDENT EXISTING GUARANTIES
(See Section 6.2.7(v))
1. That certain "Guarantee" dated as of June 1, 1993, made by Trident NGL, Inc.,
in favor of Chemical Bank, a New York banking corporation, as agent for
certain financial institutions as lenders party to that certain "Term Loan
Agreement" dated as of June 1, 1993, among Gulf Coast Fractionators ("GCF"),
a Texas general partnership, the lenders party thereto and Chemical Bank, as
agent, regarding an $85,000,000 term loan credit facility; and pursuant to
which Trident has guaranteed a maximum amount equal to 38.75% of the amount
by which $10,000,000 exceeds the amounts paid by GCF into a Debt Service
Reserve Account.
2. Guaranty, dated as of March 14, 1995, made by Trident NGL, Inc. in favor of
The First National Bank of Chicago, as agent for the pro rata benefit of the
lenders party to that certain "Credit Agreement" dated as of March 14, 1995
among NGC Corporation, each of the lenders which is a party thereto, and The
First National Bank of Chicago, as agent for itself and the other lenders
party thereto, pursuant to which Trident has guaranteed payment when due of
any and all obligations of NGC Corporation to any of the lenders with respect
to any Note or Letter of Credit issued pursuant to the Credit Agreement.
3. Guaranty made by Trident NGL, Inc. under the Indenture, dated as of December
11, 1995 among NGC Corporation, certain Subsidiary Guarantors (including
Trident) and The First National Bank of Chicago, as Trustee, pursuant to
which Trident has guaranteed to the holders of the securities and to the
Trustee the payment when due of all principal, interest and all other amounts
payable under the Indenture.
Schedule 4 Page 1