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EXHIBIT 4.16
PLEDGE AGREEMENT
PLEDGE AGREEMENT, dated as of November 5, 1997, made by each
of the signatories hereto (together with any other entity that may become a
party hereto, the "Pledgors"), in favor of THE CHASE MANHATTAN BANK, as
administrative agent (in such capacity, the "Administrative Agent") for the
several lenders (the "Lenders") from time to time parties to the Credit
Agreement, dated as of November 5, 1997 (as amended, supplemented or otherwise
modified from time to time, the "Credit Agreement"), among THE MERIDIAN
RESOURCE CORPORATION, a Texas corporation (the "Borrower"), the Administrative
Agent and such Lenders.
W I T N E S S E T H:
WHEREAS, pursuant to the Credit Agreement, the Lenders have severally
agreed to make Extensions of Credit to the Borrower upon the terms and subject
to the conditions set forth therein; and
WHEREAS, it is a condition precedent to the obligation of the Lenders
to make their respective Extensions of Credit to the Borrower under the Credit
Agreement that each Pledgor shall have executed and delivered this Pledge
Agreement to the Administrative Agent for the ratable benefit of the Lenders.
NOW, THEREFORE, in consideration of the premises and to induce
the Administrative Agent and the Lenders to enter into the Credit Agreement and
to induce the Lenders to make their respective Extensions of Credit to the
Borrower, each Pledgor hereby agrees with the Agent, for the ratable benefit of
the Lenders, as follows:
1. Defined Terms. (a) Unless otherwise defined herein, terms
defined in the Credit Agreement and used herein shall have the meanings given
to them in the Credit Agreement.
(b) The following terms shall have the following meanings:
"Agreement": this Pledge Agreement, as the same may be amended,
modified or otherwise supplemented from time to time.
"Borrower Obligations": the collective reference to the unpaid
principal of and interest on the Loans and Reimbursement Obligations and all
other obligations and liabilities of the Borrower (including, without
limitation, interest accruing at the then applicable rate provided in the
Credit Agreement after the maturity of the Loans and Reimbursement Obligations
and interest accruing at the then applicable rate
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provided in the Credit Agreement after the filing of any petition in
bankruptcy, or the commencement of any insolvency, reorganization or like
proceeding, relating to the Borrower, whether or not a claim for post-filing or
post-petition interest is allowed in such proceeding) to the Administrative
Agent or any Lender (or, in the case of any Hedging Agreement referred to
below, any Affiliate of any Lender), whether direct or indirect, absolute or
contingent, due or to become due, or now existing or hereafter incurred, which
may arise under, out of, or in connection with, the Credit Agreement, this
Agreement, the other Loan Documents, any Letter of Credit or any Hedging
Agreement entered into by the Borrower with any Lender (or any Affiliate of any
Lender) or any other document made, delivered or given in connection therewith,
in each case whether on account of principal, interest, reimbursement
obligations, fees, indemnities, costs, expenses or otherwise (including,
without limitation, all fees and disbursements of counsel to the Administrative
Agent or to the Lenders that are required to be paid by the Borrower pursuant
to the terms of any of the foregoing agreements).
"Code": the Uniform Commercial Code from time to time in effect in
the State of New York.
"Collateral": the Pledged Stock and all Proceeds.
"Collateral Account": any account established to hold money Proceeds,
maintained under the sole dominion and control of the Administrative Agent,
subject to withdrawal by the Administrative Agent for the account of the
Lenders only as provided in paragraph 8(a).
"Guarantor Obligations": with respect to any Guarantor, the
collective reference to (i) the Borrower Obligations and (ii) all obligations
and liabilities of such Guarantor which may arise under or in connection with
this Agreement, the Guarantee Agreement or any other Loan Document to which
such Guarantor is a party, in each case whether on account of guarantee
obligations, reimbursement obligations, fees, indemnities, costs, expenses or
otherwise (including, without limitation, all fees and disbursements of counsel
to the Administrative Agent or to the Lenders that are required to be paid by
such Guarantor pursuant to the terms of this Agreement or any other Loan
Document).
"Guarantors": the collective reference to each Pledgor other than the
Borrower.
"Issuers": the collective reference to the companies identified on
Schedule 1 attached hereto as the issuers of the Pledged Stock; individually,
each an "Issuer".
"Pledged Stock": the shares of capital stock listed on Schedule 1
hereto, together with all stock certificates, options or rights of any nature
whatsoever that may be issued or granted by any Issuer to any Pledgor while
this Agreement is in effect.
"Proceeds": all "proceeds" as such term is defined in Section
9-306(1) of the Uniform Commercial Code in effect in the State of New York on
the date hereof and, in any event,
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shall include, without limitation, all dividends or other income from the
Pledged Stock, collections thereon or distributions with respect thereto.
"Secured Obligations": (i) in the case of the Borrower, the Borrower
Obligations and (ii) in the case of each Guarantor, its Guarantor Obligations.
"Securities Act": the Securities Act of 1933, as amended.
(c) The words "hereof," "herein" and "hereunder" and words of similar
import when used in this Agreement shall refer to this Agreement as a whole and
not to any particular provision of this Agreement, and section and paragraph
references are to this Agreement unless otherwise specified.
(d) The meanings given to terms defined herein shall be equally
applicable to both the singular and plural forms of such terms.
2. Pledge; Grant of Security Interest. Each Pledgor hereby delivers
to the Administrative Agent, for the ratable benefit of the Lenders, all of
such Pledgor's Pledged Stock and hereby grants to Administrative Agent, for the
ratable benefit of the Lenders, a first priority security interest in the
Collateral, as collateral security for the prompt and complete payment and
performance when due (whether at the stated maturity, by acceleration or
otherwise) of the Secured Obligations.
3. Stock Powers. Concurrently with the delivery to the
Administrative Agent of each certificate representing one or more shares of
Pledged Stock to the Administrative Agent, the relevant Pledgor shall deliver
an undated stock power covering such certificate, duly executed in blank by
such Pledgor with, if the Administrative Agent so requests, signature
guaranteed.
4. Representations and Warranties. Each Pledgor represents and
warrants that:
(a) The shares of such Pledgor's Pledged Stock constitute all the
issued and outstanding shares of all classes of the capital stock of each
Issuer thereof.
(b) All the shares of the Pledged Stock pledged by such Pledgor have
been duly and validly issued and are fully paid and nonassessable.
(c) Such Pledgor is the record and beneficial owner of, and has good
and marketable title to, such Pledgor's Pledged Stock, free of any and all
Liens or options in favor of, or claims of, any other Person, except the
security interest created by this Agreement.
5. Covenants. Each Pledgor covenants and agrees with the
Administrative Agent and the Lenders that, from and after the date of this
Agreement until this Agreement is terminated and the security interests created
hereby are released:
(a) If such Pledgor shall, as a result of its ownership of the
Pledged Stock, become entitled to receive or shall receive any stock
certificate (including, without limitation, any certificate representing a
stock dividend or a distribution in connection with any
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reclassification, increase or reduction of capital or any certificate issued in
connection with any reorganization), option or rights, whether in addition to,
in substitution of, as a conversion of, or in exchange for any shares of the
Pledged Stock, or otherwise in respect thereof, such Pledgor shall accept the
same as the agent of the Administrative Agent and the Lenders, hold the same in
trust for the Agent and the Lenders and deliver the same forthwith to the Agent
in the exact form received, duly indorsed by such Pledgor to the Administrative
Agent, if required, together with an undated stock power covering such
certificate duly executed in blank by such Pledgor and with, if the
Administrative Agent so requests, signature guaranteed, to be held by the
Administrative Agent, subject to the terms hereof, as additional collateral
security for the Secured Obligations. Any sums paid upon or in respect of the
Pledged Stock upon the liquidation or dissolution of any Issuer shall be paid
over to the Administrative Agent to be held by it hereunder as additional
collateral security for the Secured Obligations, and in case any distribution of
capital shall be made on or in respect of the Pledged Stock or any property
shall be distributed upon or with respect to the Pledged Stock pursuant to the
recapitalization or reclassification of the capital of any Issuer or pursuant to
the reorganization thereof, the property so distributed shall be delivered to
the Administrative Agent to be held by it hereunder as additional collateral
security for the Secured Obligations. If any sums of money or property so paid
or distributed in respect of the Pledged Stock shall be received by such
Pledgor, such Pledgor shall, until such money or property is paid or delivered
to the Administrative Agent, hold such money or property in trust for the
Lenders, segregated from other funds of such Pledgor, as additional collateral
security for the Secured Obligations.
(b) Without the prior written consent of the Administrative Agent,
such Pledgor shall not (1) vote to enable, or take any other action to permit,
any Issuer to issue any stock or other equity securities of any nature or to
issue any other securities convertible into or granting the right to purchase
or exchange for any stock or other equity securities of any nature of any
Issuer, (2) sell, assign, transfer, exchange, or otherwise dispose of, or grant
any option with respect to, the Collateral, (3) create, incur or permit to
exist any Lien or option in favor of, or any claim of any Person with respect
to, any of the Collateral, or any interest therein, except for the security
interests created by this Agreement or (4) enter into any agreement or
undertaking restricting the right or ability of such Pledgor or the
Administrative Agent to sell, assign or transfer any of the Collateral.
(c) Such Pledgor shall maintain the security interest created by this
Agreement as a first, perfected security interest and shall defend such
security interest against claims and demands of all Persons whomsoever. At any
time and from time to time, upon the written request of the Administrative
Agent, and at the sole expense of such Pledgor, such Pledgor will promptly and
duly execute and deliver such further instruments and documents and take such
further actions as the Administrative Agent may reasonably request for the
purposes of obtaining or preserving the full benefits of this Agreement and of
the rights and powers herein granted. If any amount payable under or in
connection with any of the Collateral shall be or become evidenced by any
promissory note, other instrument or chattel paper, such note, instrument or
chattel paper shall be immediately delivered to the Administrative Agent, duly
endorsed in a manner satisfactory to the Administrative Agent, to be held as
Collateral pursuant to this Agreement.
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(d) Such Pledgor shall pay, and save the Administrative Agent and the
Lenders harmless from, any and all liabilities with respect to, or resulting
from any delay in paying, any and all stamp, excise, sales or other taxes which
may be payable or determined to be payable with respect to any of the
Collateral or in connection with any of the transactions contemplated by this
Agreement.
6. Cash Dividends; Voting Rights. Unless an Event of Default shall
have occurred and be continuing and the Administrative Agent shall have given
notice to a Pledgor or Pledgors of the Administrative Agent's intent to
exercise its corresponding rights pursuant to Section 7 below, all Pledgors
shall be permitted to receive all cash dividends paid in the normal course of
business of the Issuers, to the extent permitted in the Credit Agreement, in
respect of the Pledged Stock and to exercise all voting and corporate rights
with respect to the Pledged Stock; provided, however, that no vote shall be
cast or corporate right exercised or other action taken which, in the
Administrative Agent's reasonable judgment, would impair the Collateral or
which would be inconsistent with or result in any violation of any provision of
the Credit Agreement, the Notes, this Agreement or any other Loan Document.
7. Rights of the Lenders and the Administrative Agent. (a) All
money Proceeds received by the Administrative Agent hereunder shall be held by
the Administrative Agent for the benefit of the Lenders in a Collateral
Account. All Proceeds while held by the Administrative Agent in a Collateral
Account (or by a Pledgor in trust for the Administrative Agent and the Lenders)
shall continue to be held as collateral security for all the Secured
Obligations and shall not constitute payment thereof until applied as provided
in paragraph 8(a).
(b) If an Event of Default shall occur and be continuing and the
Administrative Agent shall give notice of its intent to exercise such rights to
the relevant Pledgor or Pledgors, (1) the Administrative Agent shall have the
right to receive any and all cash dividends paid in respect of the Pledged
Stock and make application thereof to the Secured Obligations in such order as
the Administrative Agent may determine, and (2) all shares of the Pledged Stock
shall be registered in the name of the Administrative Agent or its nominee, and
the Administrative Agent or its nominee may thereafter exercise (A) all voting,
corporate and other rights pertaining to such shares of the Pledged Stock at
any meeting of shareholders of the applicable Issuer or Issuers or otherwise
and (B) any and all rights of conversion, exchange, subscription and any other
rights, privileges or options pertaining to such shares of the Pledged Stock as
if it were the absolute owner thereof (including, without limitation, the right
to exchange at its discretion any and all of the Pledged Stock upon the merger,
consolidation, reorganization, recapitalization or other fundamental change in
the corporate structure of such Issuer, or upon the exercise by such Pledgor or
the Administrative Agent of any right, privilege or option pertaining to such
shares of the Pledged Stock, and in connection therewith, the right to deposit
and deliver any and all of the Pledged Stock with any committee, depositary,
transfer agent, registrar or other designated agency upon such terms and
conditions as the Administrative Agent may determine), all without liability
except to account for property actually received by it, but the Administrative
Agent shall have no duty to such Pledgor to exercise any such right, privilege
or option and shall not be responsible for any failure to do so or delay in so
doing.
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8. Remedies. (a) If an Event of Default shall have occurred and be
continuing, at any time at the Administrative Agent's election, the
Administrative Agent may apply all or any part of Proceeds held in any
Collateral Account in payment of the Secured Obligations in such order as the
Administrative Agent may elect.
(b) If an Event of Default shall occur and be continuing, the
Administrative Agent, on behalf of the Lenders, may exercise, in addition to
all other rights and remedies granted in this Agreement and in any other
instrument or agreement securing, evidencing or relating to the Secured
Obligations, all rights and remedies of a secured party under the Code.
Without limiting the generality of the foregoing, the Administrative Agent,
without demand of performance or other demand, presentment, protest,
advertisement or notice of any kind (except any notice required by law referred
to below) to or upon any Pledgor or any other Person (all and each of which
demands, defenses, advertisements and notices are hereby waived), may in such
circumstances forthwith collect, receive, appropriate and realize upon the
Collateral, or any part thereof, and/or may forthwith sell, assign, give option
or options to purchase or otherwise dispose of and deliver the Collateral or
any part thereof (or contract to do any of the foregoing), in one or more
parcels at public or private sale or sales, in the over-the-counter market, at
any exchange, broker's board or office of the Administrative Agent or any
Lender or elsewhere upon such terms and conditions as it may deem advisable and
at such prices as it may deem best, for cash or on credit or for future
delivery without assumption of any credit risk. The Administrative Agent or
any Lender shall have the right upon any such public sale or sales, and, to the
extent permitted by law, upon any such private sale or sales, to purchase the
whole or any part of the Collateral so sold, free of any right or equity of
redemption in the relevant Pledgor, which right or equity is hereby waived or
released. The Administrative Agent shall apply any Proceeds from time to time
held by it and the net proceeds of any such collection, recovery, receipt,
appropriation, realization or sale, after deducting all reasonable costs and
expenses of every kind incurred in respect thereof or incidental to the care or
safekeeping of any of the Collateral or in any way relating to the Collateral
or the rights of the Administrative Agent and the Lenders hereunder, including,
without limitation, reasonable attorneys' fees and disbursements of counsel to
the Administrative Agent, to the payment in whole or in part of the Secured
Obligations, in such order as the Administrative Agent may elect, and only
after such application and after the payment by the Administrative Agent of any
other amount required by any provision of law, including, without limitation,
Section 9-504(1)(c) of the Code, need the Administrative Agent account for the
surplus, if any, to the relevant Pledgor. To the extent permitted by
applicable law, each Pledgor waives all claims, damages and demands it may
acquire against the Administrative Agent or any Lender arising out of the
exercise by them of any rights hereunder. If any notice of a proposed sale or
other disposition of Collateral shall be required by law, such notice shall be
deemed reasonable and proper if given at least 10 days before such sale or
other disposition.
(c) Each Pledgor waives and agrees not to assert any rights or
privileges which it may acquire under Section 9-112 of the Code. The Pledgors
shall remain liable for any deficiency if the proceeds of any sale or other
disposition of Collateral are insufficient to pay the Secured Obligations and
the fees and disbursements of any attorneys employed by the Administrative
Agent or any Lender to collect such deficiency.
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9. Registration Rights; Private Sales. (a) If the Administrative
Agent shall determine to exercise its right to sell any or all of the Pledged
Stock pursuant to paragraph 8(b) hereof, and if in the opinion of the
Administrative Agent it is necessary or advisable to have the Pledged Stock, or
that portion thereof to be sold, registered under the provisions of the
Securities Act, each Pledgor will cause the Issuer thereof to (1) execute and
deliver, and cause the directors and officers of such Issuer to execute and
deliver, all such instruments and documents, and do or cause to be done all
such other acts as may be, in the opinion of the Administrative Agent,
necessary or advisable to register the Pledged Stock, or that portion thereof
to be sold, under the provisions of the Securities Act, (2) to use its best
efforts to cause the registration statement relating thereto to become
effective and to remain effective for a period of one year from the date of the
first public offering of the Pledged Stock, or that portion thereof to be sold,
and (3) to make all amendments thereto and/or to the related prospectus which,
in the opinion of the Administrative Agent, are necessary or advisable, all in
conformity with the requirements of the Securities Act and the rules and
regulations of the Securities and Exchange Commission applicable thereto. Each
Pledgor agrees to cause such Issuer to comply with the provisions of the
securities or "Blue Sky" laws of any and all jurisdictions which the
Administrative Agent shall designate and to make available to its security
holders, as soon as practicable, an earnings statement (which need not be
audited) which will satisfy the provisions of Section 11(a) of the Securities
Act.
(b) Each Pledgor recognizes that the Administrative Agent may be
unable to effect a public sale of any or all the Pledged Stock, by reason of
certain prohibitions contained in the Securities Act and applicable state
securities laws or otherwise, and may be compelled to resort to one or more
private sales thereof to a restricted group of purchasers which will be obliged
to agree, among other things, to acquire such securities for their own account
for investment and not with a view to the distribution or resale thereof. Each
Pledgor acknowledges and agrees that any such private sale may result in prices
and other terms less favorable than if such sale were a public sale and,
notwithstanding such circumstances, agrees that any such private sale shall be
deemed to have been made in a commercially reasonable manner. The
Administrative Agent shall be under no obligation to delay a sale of any of the
Pledged Stock for the period of time necessary to permit the Issuer thereof to
register such securities for public sale under the Securities Act, or under
applicable state securities laws, even if such Issuer would agree to do so.
(c) Each Pledgor further agrees to use its best efforts to do or
cause to be done all such other acts as may be necessary to make such sale or
sales of all or any portion of the Pledged Stock pursuant to this Section 9
valid and binding and in compliance with any and all other applicable
Requirements of Law. Each Pledgor further agrees that a breach of any of the
covenants contained in this Section 9 will cause irreparable injury to the
Administrative Agent and the Lenders, that the Administrative Agent and the
Lenders have no adequate remedy at law in respect of such breach and, as a
consequence, that each and every covenant contained in this Section shall be
specifically enforceable against such Pledgor, and such Pledgor hereby waives
and agrees not to assert any defenses against an action for specific
performance of such covenants except for a defense that no Event of Default has
occurred under the Credit Agreement.
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10. Irrevocable Authorization and Instruction to Issuer. Each
Pledgor hereby authorizes and instructs each Issuer to comply with any
instruction received by it from the Administrative Agent in writing that (a)
states that an Event of Default has occurred and (b) is otherwise in accordance
with the terms of this Agreement, without any other or further instructions
from such Pledgor, and each Pledgor agrees that each Issuer shall be fully
protected in so complying.
11. Administrative Agent's Appointment as Attorney-in-Fact. (a)
Each Pledgor hereby irrevocably constitutes and appoints the Administrative
Agent and any officer or agent of the Administrative Agent, with full power of
substitution, as its true and lawful attorney-in-fact with full irrevocable
power and authority in the place and stead of such Pledgor and in the name of
such Pledgor or in the Administrative Agent's own name, from time to time in
the Administrative Agent's discretion, for the purpose of carrying out the
terms of this Agreement, to take any and all appropriate action and to execute
any and all documents and instruments which may be necessary or desirable to
accomplish the purposes of this Agreement, including, without limitation, any
financing statements, endorsements, assignments or other instruments of
transfer.
(b) Each Pledgor hereby ratifies all that said attorneys shall
lawfully do or cause to be done pursuant to the power of attorney granted in
paragraph 11(a). All powers, authorizations and agencies contained in this
Agreement are coupled with an interest and are irrevocable until this Agreement
is terminated and the security interests created hereby are released.
12. Duty of Administrative Agent. The Administrative Agent's sole
duty with respect to the custody, safekeeping and physical preservation of the
Collateral in its possession, under Section 9-207 of the Code or otherwise,
shall be to deal with it in the same manner as the Administrative Agent deals
with similar securities and property for its own account, except that the
Administrative Agent shall have no obligation to invest funds held in any
Collateral Account and may hold the same as demand deposits. Neither the
Administrative Agent, any Lender nor any of their respective directors,
officers, employees or agents shall be liable for failure to demand, collect or
realize upon any of the Collateral or for any delay in doing so or shall be
under any obligation to sell or otherwise dispose of any Collateral upon the
request of any Pledgor or any other Person or to take any other action
whatsoever with regard to the Collateral or any part thereof.
13. Execution of Financing Statements. Pursuant to Section 9-402 of
the Code, each Pledgor authorizes the Administrative Agent to file financing
statements with respect to the Collateral without the signature of such Pledgor
in such form and in such filing offices as the Administrative Agent reasonably
determines appropriate to perfect the security interests of the Administrative
Agent under this Agreement. A carbon, photographic or other reproduction of
this Agreement shall be sufficient as a financing statement for filing in any
jurisdiction.
14. Authority of Administrative Agent. Each Pledgor acknowledges
that the rights and responsibilities of the Administrative Agent under this
Agreement with respect to any action taken by the Administrative Agent or the
exercise or non-exercise by the Administrative Agent of any option, voting
right, request, judgment or other right or remedy
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provided for herein or resulting or arising out of this Agreement shall, as
between the Administrative Agent and the Lenders, be governed by the Credit
Agreement and by such other agreements with respect thereto as may exist from
time to time among them, but, as between the Administrative Agent and the
Pledgors, the Administrative Agent shall be conclusively presumed to be acting
as agent for the Lenders with full and valid authority so to act or refrain
from acting, and neither the Pledgors nor any Issuer shall be under any
obligation, or entitlement, to make any inquiry respecting such authority.
15. Notices. All notices, requests and demands to or upon the
Administrative Agent or the Pledgors to be effective shall be effected in the
manner provided for in subsection 11.2 of the Credit Agreement, addressed as
follows:
(1) if to the Administrative Agent, at its address or transmission
number for notices provided in subsection 11.2 of the Credit Agreement; and
(2) if to a Pledgor, at its address or transmission number for
notices set forth on Schedule 2 hereto. The Administrative Agent and the
Pledgors may change their addresses and transmission numbers for notices by
notice in the manner provided in this subsection 11.2 of the Credit Agreement.
16. Severability. Any provision of this Agreement which is
prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction,
be ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions hereof, and any such prohibition or
unenforceability in any jurisdiction shall not invalidate or render
unenforceable such provision in any other jurisdiction.
17. Amendments in Writing; No Waiver; Cumulative Remedies. (a)
None of the terms or provisions of this Agreement may be waived, amended,
supplemented or otherwise modified in accordance with subsection 11.01 of the
Credit Agreement.
(b) Neither the Administrative Agent nor any Lender shall by any act
(except by a written instrument pursuant to paragraph 17(a) hereof), delay,
indulgence, omission or otherwise be deemed to have waived any right or remedy
hereunder or to have acquiesced in any Default or Event of Default or in any
breach of any of the terms and conditions hereof. No failure to exercise, nor
any delay in exercising, on the part of the Administrative Agent or any Lender,
any right, power or privilege hereunder shall operate as a waiver thereof. No
single or partial exercise of any right, power or privilege hereunder shall
preclude any other or further exercise thereof or the exercise of any other
right, power or privilege. A waiver by the Administrative Agent or any Lender
of any right or remedy hereunder on any one occasion shall not be construed as
a bar to any right or remedy which the Administrative Agent or such Lender
would otherwise have on any future occasion.
(c) The rights and remedies herein provided are cumulative, may be
exercised singly or concurrently and are not exclusive of any other rights or
remedies provided by law.
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18. Section Headings. The section headings used in this Agreement
are for convenience of reference only and are not to affect the construction
hereof or be taken into consideration in the interpretation hereof.
19. Successors and Assigns. This Agreement shall be binding upon the
successors and assigns of each Pledgor and shall inure to the benefit of the
Administrative Agent and the Lenders and their successors and assigns.
20. Governing Law. This Agreement shall be governed by, and
construed and interpreted in accordance with, the law of the State of New York.
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IN WITNESS WHEREOF, the undersigned has caused this Agreement to be
duly executed and delivered as of the date first above written.
THE MERIDIAN RESOURCE CORPORATION
By
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Title
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ACKNOWLEDGEMENT AND CONSENT
The undersigned hereby acknowledges receipt of a copy of the Pledge
Agreement dated November , 1997, made by [Name of Pledgor] (the "Pledgor")
for the benefit of The Chase Manhattan Bank, as Administrative Agent (the
"Pledge Agreement"). The undersigned agrees for the benefit of the
Administrative Agent and the Lenders as follows:
1. The undersigned will be bound by the terms of the Pledge Agreement
and will comply with such terms insofar as such terms are applicable to the
undersigned.
2. The undersigned will notify the Administrative Agent promptly in
writing of the occurrence of any of the events described in paragraph 5(a) of
the Pledge Agreement.
3. The terms of paragraph 9(c) of the Pledge Agreement shall apply to
it, mutatis mutandis, with respect to all actions that may be required of it
under or pursuant to or arising out of Section 9 of the Pledge Agreement.
[NAME OF ISSUER]
By
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Title
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Address for Notices:
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Telex:
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Fax:
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SCHEDULE 1
TO PLEDGE AGREEMENT
DESCRIPTION OF PLEDGED STOCK
Stock Certificate
Issuer Class of Stock* No. No. of Shares
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Cairn Energy USA, Inc. common C1 1,000
Texas Meridian Resources common 1 1,000
Exploration, Inc.
Texas Meridian Production common 1 1,000
Corporation
Texas Meridian Finance Corporation common 1 1,000
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SCHEDULE 2
TO PLEDGE AGREEMENT
ADDRESS FOR NOTICES
c/o Chief Executive Officer
The Meridian Resource Corporation
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Fax: (713) 58-5595