Exhibit 10.3
GLOBAL CREDIT AGREEMENT
Dated as of March 27, 1998
among
OCEAN ENERGY, INC.,
a Delaware corporation,
OCEAN ENERGY, INC.,
a Louisiana corporation,
CHASE BANK OF TEXAS, NATIONAL ASSOCIATION,
as Administrative Agent,
XXXXXX GUARANTY TRUST COMPANY OF NEW YORK,
as Syndication Agent,
BARCLAYS BANK PLC,
as Documentation Agent,
ABN AMRO BANK, N.V.,
BANK OF AMERICA NATIONAL TRUST &
SAVINGS ASSOCIATION,
BANQUE PARIBAS,
NATIONSBANK OF TEXAS, N.A.,
SOCIETE GENERALE, SOUTHWEST AGENCY,
AND
XXXXX FARGO BANK (TEXAS), N.A.,
as Co-Agents,
and
THE LENDERS NOW OR HEREAFTER PARTIES HERETO
TABLE OF CONTENTS
Page
ARTICLE I
Definitions and Accounting Matters
Section 1.01 Terms Defined in Recitals..............................................................2
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Section 1.02 Certain Defined Terms..................................................................2
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Section 1.03 Accounting Terms and Determinations...................................................20
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ARTICLE II
Commitments
Section 2.01 Loans and Letters of Credit...........................................................21
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Section 2.02 Borrowings, Continuations and Conversions; Issuance of Letters of
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Credit................................................................................22
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Section 2.03 Extensions and Changes of Commitments.................................................26
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Section 2.04 Facility Fee and Other Fees...........................................................28
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Section 2.05 Lending Offices.......................................................................28
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Section 2.06 Several Obligations...................................................................28
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Section 2.07 Notes.................................................................................29
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Section 2.08 Prepayments...........................................................................29
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Section 2.09 Borrowing Base........................................................................31
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ARTICLE III
Payments of Principal and Interest
Section 3.01 Repayment of Loans....................................................................34
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Section 3.02 Interest..............................................................................34
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ARTICLE IV
Payments; Pro Rata Treatment; Computations; Etc.
Section 4.01 Payments..............................................................................35
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Section 4.02 Pro Rata Treatment....................................................................36
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Section 4.03 Computations..........................................................................36
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Section 4.04 Non-receipt of Funds by the Administrative Agent......................................36
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Section 4.05 Sharing of Payments, Etc..............................................................37
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Section 4.06 Assumption of Risks...................................................................38
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Section 4.07 Obligation to Reimburse and to Prepay.................................................38
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Section 4.08 Obligations for Letters of Credit.....................................................39
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ARTICLE V
Yield Protection and Illegality
Section 5.01 Additional Costs......................................................................40
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Section 5.02 Limitation on Eurodollar Loans........................................................41
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Section 5.03 Illegality............................................................................41
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Section 5.04 Base Rate Loans pursuant to Sections 5.01, 5.02 and 5.03..............................42
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Section 5.05 Compensation..........................................................................42
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Section 5.06 Additional Cost in Respect of Tax.....................................................42
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Section 5.07 Avoidance of Taxes and Additional Costs...............................................43
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Section 5.08 Lender Tax Representation.............................................................44
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Section 5.09 Limitation on Right to Compensation...................................................44
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Section 5.10 Compensation Procedure................................................................44
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ARTICLE VI
Conditions Precedent
Section 6.01 Initial Funding.......................................................................45
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Section 6.02 Subsequent Loans and Letters of Credit................................................46
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Section 6.03 Conditions Relating to Letters of Credit..............................................47
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ARTICLE VII
Representations and Warranties
Section 7.01 Corporate Existence...................................................................47
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Section 7.02 Financial Condition...................................................................48
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Section 7.03 Litigation............................................................................48
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Section 7.04 No Breach.............................................................................48
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Section 7.05 Corporate Action; Binding Obligation..................................................48
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Section 7.06 Approvals.............................................................................49
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Section 7.07 Use of Loans and Letters of Credit....................................................49
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Section 7.08 ERISA.................................................................................49
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Section 7.09 Taxes.................................................................................50
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Section 7.10 Insurance.............................................................................50
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Section 7.11 Titles, etc...........................................................................50
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Section 7.12 No Material Misstatements.............................................................50
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Section 7.13 Investment Company Act................................................................50
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Section 7.14 Public Utility Holding Company Act....................................................51
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Section 7.15 Subsidiaries and Partnerships.........................................................51
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Section 7.16 Location of Business and Offices......................................................51
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Section 7.17 Rate Filings..........................................................................51
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Section 7.18 Environmental Matters.................................................................51
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Section 7.19 Defaults..............................................................................52
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Section 7.20 Compliance with the Law...............................................................52
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Section 7.21 Risk Management Agreements............................................................53
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Section 7.22 Gas Imbalances........................................................................53
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Section 7.23 Solvency..............................................................................53
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ARTICLE VIII
Affirmative Covenants
Section 8.01 Financial Statements..................................................................53
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Section 8.02 Litigation............................................................................56
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Section 8.03 Corporate Existence, Etc..............................................................56
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Section 8.04 Environmental Matters.................................................................57
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Section 8.05 Engineering Reports...................................................................57
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Section 8.06 Stock of Restricted Subsidiaries......................................................58
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Section 8.07 Further Assurances....................................................................58
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Section 8.08 Performance of Obligations............................................................59
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ARTICLE IX
Negative Covenants
Section 9.01 Debt..................................................................................59
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Section 9.02 Liens.................................................................................61
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Section 9.03 Investments, Loans and Advances.......................................................62
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Section 9.04 Dividends, Distributions and Redemptions..............................................64
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Section 9.05 Financial Covenants...................................................................64
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Section 9.06 Nature of Business....................................................................65
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Section 9.07 Limitation on Operating Leases and Sale-Leaseback Transactions........................65
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Section 9.08 Mergers, Etc..........................................................................65
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Section 9.09 Proceeds of Notes.....................................................................65
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Section 9.10 ERISA Compliance......................................................................65
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Section 9.11 Sale or Discount of Receivables.......................................................66
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Section 9.12 Risk Management Agreements............................................................66
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Section 9.13 Transactions with Affiliates..........................................................66
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Section 9.14 Negative Pledge Agreements............................................................66
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Section 9.15 Subsidiaries and Partnerships.........................................................66
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Section 9.16 Sale of Oil and Gas Properties........................................................67
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Section 9.17 Environmental Matters.................................................................67
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Section 9.18 Payment Restrictions..................................................................67
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Section 9.19 Subordinated and Long-Term Pari Passu Debt............................................67
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Section 9.20 Maintenance of Deposits...............................................................68
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Section 9.21 Unrestricted Subsidiaries.............................................................68
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Section 9.22 Gas Imbalances, Take-or-Pay or Other Prepayments......................................69
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ARTICLE X
Events of Default
Section 10.01 Events of Default.....................................................................69
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Section 10.02 Cash Collateral for Letters of Credit.................................................72
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ARTICLE XI
The Agents
Section 11.01 Appointment, Powers and Immunities....................................................72
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Section 11.02 Reliance by Agents....................................................................72
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Section 11.03 Defaults..............................................................................73
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Section 11.04 Rights as a Lender....................................................................73
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Section 11.05 Indemnification.......................................................................73
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Section 11.06 Non-Reliance on Agents and other Lenders..............................................74
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Section 11.07 Action by Agents......................................................................74
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Section 11.08 Resignation or Removal of Agents......................................................74
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ARTICLE XII
Miscellaneous
Section 12.01 Waiver................................................................................75
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Section 12.02 Notices...............................................................................75
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Section 12.03 Payment of Expenses, Indemnities, etc.................................................75
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Section 12.04 Amendments, Etc.......................................................................77
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Section 12.05 Successors and Assigns................................................................77
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Section 12.06 Assignments and Participations........................................................77
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Section 12.07 Invalidity............................................................................79
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Section 12.08 Entire Agreement......................................................................79
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Section 12.09 References............................................................................79
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Section 12.10 Survival..............................................................................79
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Section 12.11 Captions..............................................................................79
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Section 12.12 Counterparts..........................................................................79
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Section 12.13 GOVERNING LAW.........................................................................80
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Section 12.14 Confidentiality.......................................................................80
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Section 12.15 Interest..............................................................................81
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Section 12.16 Effectiveness.........................................................................82
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Section 12.17 Release of Liens and Guaranties Securing Prior Credit Agreements......................82
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Section 12.18 Survival of Obligations...............................................................82
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Section 12.19 Debt Characterization for Indenture Purposes; Specified or Designated
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Senior Indebtedness...................................................................82
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Section 12.20 EXCULPATION PROVISIONS................................................................83
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ANNEX, EXHIBITS AND SCHEDULES
Annex I - List of U.S. Commitments and Canadian Subcommitment; Global Commitment
Percentages
Exhibit A-1 - Form of Conventional Loan Note
Exhibit A-2 - Form of Bid Rate Loan Note
Exhibit B-1 - Form of Opinion of Akin, Gump, Strauss, Xxxxx & Xxxx, L.L.P.
Exhibit B-2 - Form of Opinion of Xxxxxxx, Xxxxxxx, Torian, Diaz, McNamera & Xxxxx
Exhibit C-1 - Form of Borrowing Request
Exhibit C-2 - Form of Competitive Bid Request
Exhibit C-3 - Form of Bid Loan Quote/Response to Competitive Bid Request
Exhibit D - Restricted and Unrestricted Subsidiaries
Exhibit E - Partnerships
Exhibit F - Loan Documents
Exhibit G - Form of Assignment and Acceptance
Exhibit H - Form of Master Release
Schedule 2.01 - Assumed Letters of Credit
Schedule 7.03 - Litigation
Schedule 7.08 - ERISA Obligations and ERISA Affiliates
Schedule 7.18 - Environmental Matters
Schedule 7.21 - Risk Management Agreements
Schedule 7.22 - Gas Imbalances
Schedule 9.01 - Debt not reflected in Financial Statements
Schedule 9.02 - Liens
Schedule 9.03 - Investments, loans or advances not reflected in
Financial Statements
Schedule 9.10 - Accumulated Funding Deficiencies
Schedule 9.16 - Sale Properties
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THIS GLOBAL CREDIT AGREEMENT dated as of March 27, 1998 is
among: OCEAN ENERGY, INC., a corporation duly organized and validly existing
under the laws of the state of Delaware ("OEI"); OCEAN ENERGY, INC., a
corporation duly organized and validly existing under the laws of the state of
Louisiana (the "Company"); each of the financial institutions that is now or
hereafter a signatory hereto (individually, a "Lender" and, collectively, the
"Lenders"); CHASE BANK OF TEXAS, NATIONAL ASSOCIATION, AS ADMINISTRATIVE AGENT
for the Lenders (in such capacity, the "Administrative Agent"), XXXXXX GUARANTY
TRUST COMPANY OF NEW YORK, AS SYNDICATION AGENT for the Lenders (in such
capacity, the "Syndication Agent"), BARCLAYS BANK PLC, AS DOCUMENTATION AGENT
for the Lenders (in such capacity, the "Documentation Agent"), and ABN AMRO
BANK, N.V., BANK OF AMERICA NATIONAL TRUST & SAVINGS ASSOCIATION, BANQUE
PARIBAS, NATIONSBANK OF TEXAS, N.A., SOCIETE GENERALE, SOUTHWEST AGENCY AND
XXXXX FARGO BANK (TEXAS), N.A., AS CO-AGENTS for the Lenders (in such capacity,
the "Co-Agents").
RECITALS
A. The Company, The Chase Manhattan Bank, as administrative agent, and
the financial institutions signatory thereto entered into that certain Second
Amended and Restated Credit Agreement dated as of October 15, 1997, as amended
by that certain First Amendment to Second Amended and Restated Credit Agreement
dated as of January 27, 1998 (such credit agreement, as amended, the "Prior
OEI-Louisiana Credit Agreement").
B. United Meridian Corporation, a Delaware corporation ("United
Meridian"), as guarantor, UMC Petroleum Corporation, a Delaware corporation
("UMC"), as borrower, certain of the Agents and the financial institutions
signatory thereto entered into that certain Global Credit Agreement dated as of
March 18, 1997, as amended by that certain First Joint Amendment to Global
Credit Agreement and To Credit Agreement (Canada) dated as of December 3, 1997
(such credit agreement, as amended, the "Prior UMC Credit Agreement").
X. XXX and United Meridian have merged pursuant to that certain
Agreement and Plan of Merger dated as of December 22, 1997 (as amended by
amendments thereto dated as of January 7, 1998 and February 20, 1998, the
"Merger Agreement") with OEI being the surviving Person; and UMC has merged into
the Company, with the Company being the surviving Person.
X. XXX and the Company have requested that the Agents and the Lenders
refinance the Prior OEI-Louisiana Credit Agreement and the Prior UMC Credit
Agreement (collectively, the "Prior Credit Agreements") and make credit
available on the terms and conditions stated herein.
E. The Agents and the Lenders, subject to the terms and conditions
stated herein, are willing to refinance the Prior Credit Agreements and to make
such credit facilities available.
F. NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which are acknowledged, the parties agree as follows:
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ARTICLE I
Definitions and Accounting Matters
Section 1.01 Terms Defined in Recitals. As used in this Agreement, the
terms defined in the Recitals shall have the meanings indicated in the Recitals.
Section 1.02 Certain Defined Terms. As used herein, including the
Recitals, the following terms shall have the following meanings:
"Absolute Rate" shall mean, with respect to any Bid Rate Loan, such
rate of interest as a Lender may offer the Company for any given Interest Period
therefor, which rate shall be fixed for the duration of such Interest Period.
"Absolute Rate Loans" shall mean Bid Rate Loans which bear interest at
the Absolute Rate.
"Additional Costs" shall have the meaning assigned to that term in
Section 5.01(a).
"Affected Loans" shall have the meaning assigned to that term in
Section 5.04.
"Affiliate" of any Person shall mean (a) any Person directly or
indirectly controlled by, controlling or under common control with such first
Person and (b) any director or executive officer of such first Person.
"Affiliated Canadian Lender" shall mean, with regard to any Lender, the
Canadian Lender designated as such on Annex I, if any.
"Agent" shall mean any one or more of the Administrative Agent, the
Paying Agent, the Syndication Agent, the Documentation Agent, the Technical
Agents, the Competitive Bid Auction Agent and/or the Co-Agents, or if the
context so indicates, all of the foregoing collectively. References to any Agent
shall include its successors.
"Aggregate Commitments" at any time shall equal the sum of the
Commitments of all of the Lenders.
"Agreement" shall mean this Global Credit Agreement, as amended,
supplemented or modified from time to time.
"Allocated Canadian Borrowing Base" shall mean, as of any date, an
amount in U.S. Dollars designated as such by the Company pursuant to Section
2.09(a)(iii). A Canadian Lender's Share of the Allocated Canadian Borrowing Base
shall equal such Canadian Lender's Canadian Commitment Percentage of the
Allocated Canadian Borrowing Base.
"Allocated U.S. Borrowing Base" shall mean an amount equal to the
Borrowing Base then in effect minus the Allocated Canadian Borrowing Base. A
Lender's Share of the Allocated U.S. Borrowing Base shall equal such Lender's
Commitment Percentage of the Allocated U.S. Borrowing Base.
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"Applicable Lending Office" shall mean, for each Lender and for each
Type of Loan, the lending office of such Lender (or an Affiliate of such Lender)
designated for such Type of Loan on the signature pages hereof or such other
office of such Lender (or of an Affiliate of such Lender) as such Lender may
from time to time specify to the Administrative Agent and the Company as the
office at which its Loans of such Type are to be made and maintained.
"Applicable Margin" shall mean, with respect to Conventional Loans, the
following rate per annum as is applicable:
(a) subject to clause (b) of this definition, from and after the
Effective Date, as of any date of determination, the Applicable Margin shall be
the following rate per annum as is applicable based upon the Debt Coverage Ratio
as of such date of determination:
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Debt Coverage Ratio Eurodollar Applicable Margin Base Rate Applicable Margin
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Less than 1.50 0.3750% 0.000%
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Greater than or equal to 0.4500% 0.000%
1.50, but less than 1.75
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Greater than or equal to 0.5125% 0.000%
1.75, but less than 2.50
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Greater than or equal to 0.5750% 0.000%
2.50, but less than 3.25
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Greater than or equal to 3.25 0.7500% 0.000%
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and
(b) notwithstanding clause (a) of this definition, if at any time the
sum of the aggregate outstanding principal amount of the Loans, the LC Exposure
and the Canadian Indebtedness is greater than the Threshold Amount, the
Applicable Margin for Eurodollar Loans shall be 1.075%, and the Applicable
Margin for Base Rate Loans shall be 0.000%.
"Assignment and Acceptance" shall have the meaning assigned such term
in Section 12.06(b).
"Available Canadian Subcommitment" shall mean, as of any date of
determination, the lesser of (a) the Canadian dollar amount of the Allocated
Canadian Borrowing Base (converted from U.S. Dollars to Canadian dollars by
multiplying the exchange ratio of Canadian dollars to U.S. Dollars in effect on
such date of determination, as determined in good faith by the Administrative
Agent on such date pursuant to the following sentence, and the Allocated
Canadian Borrowing Base); or (b) the aggregate Canadian Subcommitments as then
in effect. The exchange ratio shall be calculated (i) on the date a reallocation
pursuant to Section 2.09(a) between the Available Canadian Borrowing Base and
Available U.S. Borrowing Base occurs, (ii) on each Redetermination Date, or
(iii) in any event, at ninety (90) day intervals following the most recent
Redetermination Date.
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"Available U.S. Commitment" shall mean the obligation of the Lenders to
make Loans to the Company and to participate in Letters of Credit issued by the
Administrative Agent for the account of the Company and its Subsidiaries in an
aggregate amount not to exceed the lesser of either (a) the Aggregate
Commitments, as then in effect, or (b) the then applicable Allocated U.S.
Borrowing Base.
"Bankers Acceptances" shall mean any banker's acceptance issued to any
of the Canadian Lenders pursuant to the Canadian Credit Agreement.
"Base Rate" shall mean, with respect to any Base Rate Loan, for any
day, the higher of (a) the Federal Funds Rate for any such day plus 1/2 of 1% or
(b) the Prime Rate for such day. Each change in any interest rate provided for
herein based upon the Base Rate resulting from a change in the Base Rate shall
take effect at the time of such change in the Base Rate.
"Base Rate Loans" shall mean Loans which bear interest at rates based
upon the Base Rate.
"Bid Loan Quote" shall mean an offer by any Lender to make Bid Rate
Loans pursuant to Section 2.01(c), such offer being substantially in the form of
Exhibit C-3.
"Bid Rate" shall mean, with respect to any Bid Rate Loan, the rate per
annum offered by any Lender in its sole discretion to the Company pursuant to
Section 2.01(c) for any Bid Rate Loan, which rate shall be either (a) determined
on the basis of the rates referred to in the definition of "Eurodollar Rate" in
this Section 1.02 or (b) an Absolute Rate.
"Bid Rate Loan" shall mean any loan made pursuant to Section 2.01(c)
under the procedures set forth in Section 2.02(g).
"Bid Rate Note" shall mean a promissory note, described in Section
2.07(b) and being substantially in the form of Exhibit A-2, issued by the
Company to the order of a Lender evidencing Bid Rate Loans made to the Company
by such Lender.
"Borrowing Base" shall mean at any time an amount equal to the amount
determined in accordance with Section 2.09.
"Borrowing Base Deficiency" shall have the meaning assigned to that
term in Section 2.08(c).
"Business Day" shall mean any day on which commercial banks are not
authorized or required to close in Houston, Texas; and where such term is used
in the definition of "Quarterly Date" in this Section 1.02 or if such day
relates to a borrowing of, a payment or prepayment of principal of or interest
on, a continuation of, or a conversion of or into, or the Interest Period for, a
Eurodollar Loan or a notice by the Company with respect to any such borrowing,
payment, prepayment, continuation, conversion or Interest Period, any day which
is also a day on which dealings in Dollar deposits are carried out in the London
interbank market.
"Canadian Agent" shall mean The Chase Manhattan Bank of Canada, as
agent for the Canadian Lenders, together with its successors in such capacity.
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"Canadian Commitment Percentage" shall mean a Canadian Lender's share,
expressed as a percentage, of the Canadian Subcommitments as set forth under the
caption "Canadian Subcommitment Percentage" in Annex I, as modified from time to
time to reflect any assignments permitted by Section 12.03(b) of the Canadian
Credit Agreement.
"Canadian Credit Agreement" shall mean that certain Credit Agreement
dated of even date herewith among UMC Canada, the Canadian Agent and the
Canadian Lenders, as the same may be amended, restated, supplemented or modified
from time to time.
"Canadian Indebtedness" shall mean an amount, converted into U.S.
Dollars using the exchange ratio specified in the definition of "Available
Canadian Subcommitment", of the loans made and Bankers Acceptances issued and
accepted to or for UMC Canada pursuant to the Canadian Credit Agreement.
"Canadian Lenders" shall mean the lenders now or hereafter parties to
the Canadian Credit Agreement.
"Canadian Subcommitments" shall mean the "Commitments" of the Canadian
Lenders (in Canadian dollars) under the Canadian Credit Agreement.
"Code" shall mean the Internal Revenue Code of 1986, as amended.
"Commitment" shall mean, as to each Lender, the obligation of such
Lender to make Conventional Loans to the Company and to participate in the
Letters of Credit issued by the Administrative Agent for the account of the
Company or any of its Subsidiaries, in an aggregate amount at any one time
outstanding equal to the amount set forth opposite such Lender's name on Annex I
under the caption "U.S. Commitment", as the same may be reduced pursuant to
Section 2.03 or may be modified pursuant to Assignment and Acceptances pursuant
to Section 12.06(b).
"Commitment Percentage" shall mean, as of any date of determination, as
to any Lender, the percentage of the Commitments to be provided by a Lender
under this Agreement as indicated on Annex I under the caption "U.S. Commitment
Percentage", as modified from time to time to reflect any assignments permitted
by Section 12.06(b).
"Competitive Bid Auction Agent" shall mean The Chase Manhattan Bank in
its capacity as bid administrator under Section 2.02(g).
"Competitive Bid Request" shall have the meaning assigned such term in
Section 2.02(g)(i).
"Consolidated Net Income" shall mean, for any period, the consolidated
net income (or loss) of OEI and its Consolidated Restricted Subsidiaries for
such period as determined in accordance with GAAP, adjusted by excluding,
without duplication, (a) any extraordinary or non-recurring net gains or losses
together with any related provision for taxes on such gain or loss, realized in
connection with any extraordinary or nonrecurring gains or losses, (b) any
expenses associated with the Merger to the extent such expenses occur prior to
December 31, 1998 and are not in excess of $40,000,000 in the aggregate,
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(c) the amount of noncash write downs of long-lived assets in compliance with
GAAP or SEC guidelines, and (d) foreign currency translation adjustments.
"Consolidated Restricted Subsidiary" shall mean a Consolidated
Subsidiary that is a Restricted Subsidiary.
"Consolidated Subsidiary" shall mean, with respect to any Person, any
Subsidiary of such Person (whether now existing or hereafter acquired) whose
financial statements should be (or should have been) consolidated with the
financial statements of such Person in accordance with GAAP.
"Consolidated Tangible Net Worth" shall mean, with respect to OEI and
its Consolidated Subsidiaries, the sum of preferred stock (if any), par value of
common stock, capital in excess of par value of common stock and retained
earnings, less treasury stock (if any), goodwill, cost in excess of fair value
of net assets acquired and all other assets that are properly classified as
intangible assets, but plus any expenses associated with the Merger occurring
prior to December 31, 1998 and not in excess of $40,000,000 in the aggregate,
the amount of noncash write downs of long-lived assets in compliance with GAAP
or SEC guidelines, and excluding any extraordinary or non-recurring net gains or
losses together with any related provision for taxes on such gain or loss,
realized in connection with any extraordinary or nonrecurring gains or losses,
and plus or minus, as appropriate, foreign currency translation adjustments, all
as determined on a consolidated basis. Notwithstanding the foregoing,
"Consolidated Tangible Net Worth" shall not be reduced to reflect redemptions or
repurchases of equity securities permitted by the terms of Section 9.04.
"Conventional Loan Note" shall mean a promissory note, described in
Section 2.07(a) and being substantially in the form of Exhibit A-1, issued by
the Company to the order of any Lender evidencing the Conventional Loans made to
the Company by such Lender.
"Conventional Loans" shall mean the loans made pursuant to Section
2.01(a).
"Debt" shall mean, for any Person the sum of the following (without
duplication): (a) all obliga tions of such Person for borrowed money or
evidenced by bonds, debentures, notes or other similar instruments; (b) all
obligations of such Person (whether contingent or otherwise) in respect of
letters of credit, bankers' acceptances, surety or other bonds and similar
instruments; (c) all obligations of such Person to pay the deferred purchase
price of Property or services, except trade accounts payable (other than for
borrowed money) arising in the ordinary course of business of such Person; (d)
all obligations under leases which shall have been, or should have been, in
accordance with GAAP, recorded as capital leases in respect of which such Person
is liable, contingently or otherwise, as obligor, guarantor or otherwise; (e)
all Debt of others secured by a Lien on any asset of such Person, whether or not
such Debt is assumed by such Person, provided that if such Debt is Non-recourse
except with respect to the asset subject to such Lien, then only that portion of
such Debt equal to the lesser of the amount of such Debt and the fair market
value of such asset; (f) all Debt of others guaranteed by such Person or upon
which such Person is otherwise liable as a partner or otherwise to the extent of
the lesser of the amount of such Debt and the maximum stated amount of such
guarantee or other liability; (g) the undischarged balance of any production
payment created by such Person or for the creation of which such Person directly
or indirectly received payment; and (h) obligations to deliver goods or services
including Hydrocarbons in
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consideration of advance payments other than (1) obligations to sell or purchase
Hydrocarbons, (2) obligations with pipelines for firm transportation of natural
gas of such Person, and (3) oil and gas balancing agreements, take or pay
agreements or other prepayment obligations in respect of Hydrocarbons, in each
case, incurred in the ordinary course of business and which are customary in the
oil and gas industry.
"Debt Coverage Ratio" shall mean the ratio, calculated as of any date
of determination, of (a) Total Debt as of such date of determination to (b)
EBITDA of OEI and its Consolidated Restricted Subsidiaries for the immediately
preceding four (4) fiscal quarters of OEI and its Consolidated Restricted
Subsidiaries ending on the date of determination, after giving effect to the
pooling of interests treatment of the Merger.
"Default" shall mean an event which with notice or lapse of time or
both would become an Event of Default.
"Dollars", "U.S. Dollars" and "$" shall mean lawful money of the United
States of America.
"EBITDA" shall mean, with respect to OEI and its Consolidated
Restricted Subsidiaries, net earnings (excluding, without duplication, gains and
losses resulting from the sale or retirement of assets, non-cash write downs,
charges resulting from accounting convention changes and any gain or loss,
together with any related provision for taxes on such gain or loss, realized in
connection with any extraordinary or nonrecurring gains or losses, any expenses
associated with the Merger occurring prior to December 31, 1998 and not in
excess of $40,000,000 in the aggregate, and foreign currency translation
adjustments) before deduction for taxes, interest expenses, exploration
expenses, depreciation, and depletion and amortization expenses, all determined
on a consolidated basis in accordance with GAAP; provided that if OEI or any
Restricted Subsidiary shall acquire any Person or acquire or dispose of any
Properties outside the ordinary course of business or engage in any other
material transaction, EBITDA for the preceding four fiscal quarter period prior
to such transaction may be determined on a pro forma basis using or excluding,
as applicable, the revenue attributable to such Properties or Person's
Properties, as appropriate, net of operating expenses, severance and ad valorem
taxes incurred with respect to such Properties during the relevant period, as
appropriate, and otherwise as if such transaction had occurred at the start of
such four fiscal quarter period.
"Effective Date" shall have the meaning assigned such term in Section
12.16.
"Engineering Reports" shall have the meaning assigned to that term in
Section 2.09(c).
"Environmental Laws" shall mean any and all laws, statutes, ordinances,
rules, regulations, orders, or determinations of any Governmental Authority
pertaining to health or the environment in effect in any and all jurisdictions
in which OEI or any of its Subsidiaries are conducting or at any time have
conducted business, or where any Property of OEI or any of its Subsidiaries is
located, or where any hazardous substances generated by or disposed of by OEI or
any of its Subsidiaries are located, including without limitation, the Oil
Pollution Act of 1990 ("OPA"), the Clean Air Act, as amended, the Comprehensive
Environmental Response, Compensation, and Liability Act of 1980 ("CERCLA"), as
amended, the Federal Water Pollution Control Act, as amended, the Occupational
Safety and Health Act of 1970, as amended, the Resource Conservation and
Recovery Act of 1976 ("RCRA"), as amended, the Safe Drinking Water
-7-
Act, as amended, the Toxic Substances Control Act, as amended, the Superfund
Amendments and Reauthorization Act of 1986, as amended. For purposes of this
definition, the term "oil" shall have the meaning specified in OPA; the terms
"hazardous substance," "release" and "threatened release" have the meanings
specified in CERCLA, and the terms "solid waste" and "disposal" (or "disposed")
have the meanings specified in RCRA; provided that, in the event either OPA,
CERCLA or RCRA is amended so as to broaden the meaning of any term defined
thereby, such broader meaning shall apply subsequent to the effective date of
such amendment with respect to all provisions of this Agreement other than
Article VII hereof, and provided further that, to the extent the laws of the
state in which any Property of OEI or its Subsidiaries is located establish a
meaning for "oil," "hazardous substance," "release," "solid waste" or "disposal"
which is broader than that specified in either OPA, CERCLA or RCRA, such broader
meaning shall apply.
"ERISA" shall mean the Employee Retirement Income Security Act of 1974,
as amended from time to time.
"ERISA Affiliate" shall mean any corporation or trade or business which
is a member of the same controlled group of corporations (within the meaning of
Section 414(b) of the Code) as OEI or is under common control (within the
meaning of Section 414(c) of the Code) with OEI.
"Eurodollar Loans" shall mean Loans the interest rates on which are
determined on the basis of rates referred to in the definition of "Eurodollar
Rate" in this Section 1.02.
"Eurodollar Rate" shall mean, with respect to a Eurodollar Loan, the
rate per annum (rounded upwards, if necessary to the nearest 1/100 of 1%) quoted
by the Administrative Agent at approximately 11:00 a.m. London time (or as soon
thereafter as practicable) two (2) Business Days prior to the first day of the
Interest Period for such Loan for the offering by the Administrative Agent to
leading banks in the London interbank market of Dollar deposits having a term
comparable to such Interest Period and in an amount comparable to the principal
amount of the Eurodollar Loan to be made by the Lenders for such Interest
Period.
"Event of Default" shall have the meaning assigned to that term in
Section 10.01.
"Excepted Liens" shall mean: (i) Liens for taxes, assessments or other
governmental charges or levies not yet delinquent or which are being contested
in good faith by appropriate action; (ii) Liens in connection with workmen's
compensation, unemployment insurance or other social security, old age pension
or public liability obligations not yet due or which are being contested in good
faith by appropriate action; (iii) (A) vendors', carriers', operators',
warehousemen's, repairmen's, mechanics', workmen's, materialmen's, construction,
maritime, landlords' and other like Liens arising by operation of law and (B)
Liens arising by agreement (provided that no such Liens secure any obligations
constituting Debt for borrowed money or contingent obligations relating to
borrowed money), in each case, in the ordinary course of business or incident to
the exploration, development, operation and maintenance of Oil and Gas
Properties (including without limitation, Liens created in the ordinary course
of business under oil and gas leases, farm-out agreements, divisions orders,
partnership agreements, production sharing contracts or other petroleum
concessions, licenses or similar agreements, royalty agreements, contracts for
the sale or transportation of Hydrocarbons, operating agreements, development
agreements or compulsory pooling
-8-
or unitization orders, declarations and agreements and contractual landlord's
liens), in any such case, in respect of obligations which have not been
outstanding more than 90 days or which are being contested in good faith by
appropriate proceedings; (iv) Liens securing the performance of bids, tenders,
contracts (other than for the repayment of borrowed money or for the deferred
purchase price of Property or services), leases (other than leases which
constitute Debt) and government contracts, statutory or regulatory obligations,
surety and appeal bonds, and other Liens of like nature, in each case made in
the ordinary course of business; (v) any Liens securing Debt, neither assumed
nor guaranteed by OEI or any of its Subsidiaries nor on which any one of them
pays interest, existing upon real estate or rights in or relating to real estate
acquired by OEI or any Subsidiary for substation, metering station, pump
station, storage, gathering line, transmission line, transportation line,
distribution line or right of way purposes, and any Liens reserved in leases for
rent and for compliance with the terms of the leases in the case of leasehold
estates, to the extent that any such Lien referred to in this clause (v) does
not materially impair the use of the Property covered by such Lien for the
purposes for which such Property is held by OEI or such Subsidiary; (vi)
encumbrances (other than to secure the payment of borrowed money or the deferred
purchase price of Property or services), easements, restrictions, servitudes,
permits, conditions, covenants, exceptions or reservations in any rights of way
or other Property of OEI or any of its Subsidiaries for the purpose of roads,
pipelines, transmission lines, transportation lines, distribution lines for the
removal of gas, oil, coal or other minerals or timber, and other like purposes,
or for the joint or common use of real estate, rights of way, facilities and
equipment, and defects, irregularities and deficiencies in title of any rights
of way or other Property which in the aggregate do not materially impair the use
of such rights of way or other Property for the purposes of which such rights of
way and other Property are held by OEI or any of its Subsidiaries; (vii)
inchoate Liens on pipelines or pipeline facilities that arise by operation of
law which have not attached to the Property subject of such Lien, (viii) rights
of collecting banks having rights of setoff, revocation, refund or chargeback
with respect to money or instruments of OEI or any of its Subsidiaries or on
deposit with or in the possession of such banks, and (ix) judgment and
attachment Liens not giving rise to an Event of Default or Liens created by or
existing from any litigation or legal proceedings that are currently being
contested in good faith by appropriate proceedings, promptly instituted and
diligently conducted, and for which adequate reserves have been made to the
extent required by GAAP.
"Excluded Taxes" shall have the meaning assigned such term in Section
5.01(a).
"Facility Fee Rate" shall mean the following rate per annum as is
applicable:
(a) subject to clause (b) of this definition, from and after the
Effective Date, as of any date of determination, the Facility Fee Rate shall be
the following rate per annum as is applicable based upon the Debt Coverage Ratio
as of such date of determination:
-9-
--------------------------------------------------------------------------------
Debt Coverage Ratio Facility Fee Rate
--------------------------------------------------------------------------------
Less than 1.50 0.1250%
--------------------------------------------------------------------------------
Greater than or equal to 0.1500%
1.50, but less than 1.75
--------------------------------------------------------------------------------
Greater than or equal to 0.1875%
1.75, but less than 2.50
--------------------------------------------------------------------------------
Greater than or equal to 0.2250%
2.50, but less than 3.25
--------------------------------------------------------------------------------
Greater than or equal to 0.2500%
3.25
--------------------------------------------------------------------------------
and
(b) notwithstanding clause (a) of this definition, if at any time the
sum of the aggregate outstanding principal amount of the Loans, the LC Exposure
and the Canadian Indebtedness is greater than the Threshold Amount, the Facility
Fee Rate shall be 0.3000%.
"Federal Funds Rate" shall mean, for any day, the rate per annum
(rounded upwards, if necessary, to the nearest 1/100 of 1%) equal to the
weighted average of the rates on overnight Federal funds transactions with
members of the Federal Reserve System arranged by Federal funds brokers on such
day, as published by the Federal Reserve Bank of Dallas on the Business Day next
succeeding such day, provided that (i) if the day for which such rate is to be
determined is not a Business Day, the Federal Funds Rate for such day shall be
such rate on such transactions for the next preceding day as so published on the
next succeeding Business Day, and (ii) if such rate is not so published for any
Business Day, the Federal Funds Rate for such day shall be the average rate
charged to the Administrative Agent on such day on such similar transactions as
determined by the Administrative Agent.
"Fee Letters" shall mean (i) that certain letter agreement dated March
3, 1998 among, inter alia, OEI, the Administrative Agent and an Affiliate of the
Administrative Agent; and (ii) that certain letter agreement dated March 27,
1998 among, inter alia, OEI and Xxxxxx Guaranty Trust Company of New York.
"Financial Statements" shall mean the annual consolidated financial
statements of OEI and its Consolidated Subsidiaries described or referred to in
Section 7.02(a).
"GAAP" shall mean generally accepted accounting principles as in effect
on the Effective Date.
"Global Commitment Percentage" shall mean, as to any Lender, the
percentage of the Indebtedness (plus, without duplication, if such Lender is
also a Canadian Lender or has an Affiliated Canadian Lender, the Dollar amount
of Canadian Indebtedness) to be provided by such Lender under this Agreement
(and, as applicable, by such Lender or its Affiliated Canadian Lender under the
Canadian Credit Agreement)
-10-
as indicated on Annex I, as modified from time to time to reflect any
assignments permitted by Section 12.06(b) and Section 12.03(b) of the Canadian
Credit Agreement and any decreases pursuant to Section 2.03 or Section 2.03 of
the Canadian Credit Agreement.
"Governmental Authority" shall mean (a) any governmental authority
wherever located, including the federal governments of the United States, Canada
and any other foreign country or nation, and any state, county, parish,
province, municipal and political subdivisions in which any Property of OEI or
any of its Subsidiaries is located or which exercises jurisdiction over any such
Property; and (b) any court, agency, department, commission, board, bureau or
instrumentality of any of them which exercises jurisdiction over any such Person
or Property.
"Governmental Requirement" shall mean any law, statute, code,
ordinance, order, rule, regulation, judgment, decree, injunction, franchise,
permit, certificate, license, authorization or other direction or requirement
(including, without limitation, Environmental Laws, energy regulations and
occupational, safety and health standards or controls) of any Governmental
Authority.
"Guaranty Agreement" shall mean the guaranty agreement executed by OEI
in form and substance satisfactory to the Administrative Agent and the
Documentation Agent guarantying payment of the Indebtedness.
"Havre" shall mean Havre Pipeline Company, LLC, a limited liability
company established under the laws of the State of Texas of which the Company
(as successor by merger to UMC) is the manager and a majority member.
"Havre Credit Facility" shall mean that certain Credit Agreement, dated
as of September 29, 1995, by and between Union Bank and Havre, the promissory
notes described therein, the Pledge and Estoppel Agreement executed by the
Company (as successor by merger to UMC) in connection therewith, all guarantees
of any of the foregoing and all amendments, restatements, refinancings (whether
with the same lender or other lenders) and other modifications (including
increases so long as the aggregate principal amount owing in connection
therewith is less than $14,000,000) to the foregoing from time to time.
"Highest Lawful Rate" shall mean, with respect to each Lender, the
maximum nonusurious interest rate, if any, that at any time or from time to time
may be contracted for, taken, reserved, charged or received on the Notes or on
other Indebtedness under laws applicable to such Lender which are presently in
effect or, to the extent allowed by law, under such applicable laws which may
hereafter be in effect and which allow a higher maximum nonusurious interest
rate than applicable laws now allow.
"Hydrocarbon Interests" shall mean all rights, titles, interests and
estates in and to oil and gas leases; oil, gas and mineral leases; other liquid
or gaseous hydrocarbon leases; production sharing contracts or other petroleum
concessions, licenses or similar agreements made by or on behalf of a sovereign;
mineral fee interests; overriding royalty and royalty interests; net profit
interests and production payment interests in Hydrocarbons, including any
reserve or residual interest of whatever nature.
-11-
"Hydrocarbons" shall mean oil, gas, casinghead gas, drip gasoline,
natural gasoline, condensate, distillate, liquid hydrocarbons, gaseous
hydrocarbons and all products refined therefrom and all other minerals.
"Indebtedness" shall mean any and all amounts owing or to be owing by
OEI or the Company to any Agent and/or the Lenders in connection with the Notes
or any Loan Document, including this Agreement and the Letter of Credit
Agreements, and all renewals, extensions and/or rearrangements thereof, but
excluding the Canadian Indebtedness.
"Indemnity Matters" shall mean actions, suits, proceedings (including
any investigations, litigation or inquiries), claims, demands, causes of action,
costs, losses, liabilities, damages or expenses of any kind or nature
whatsoever.
"Indentures" shall mean any or all of the following, as the context
requires: (a) the 95 Indenture, (b) the 96 Indenture, and (c) the 97 Indenture.
"Initial Funding" shall mean the funding of the initial Loans pursuant
to Section 6.01.
"Initial Reserve Reports" shall mean: the reports of (a) Xxxxx Xxxxx
Company Petroleum Engineers and XxXxxxxx & Associates Consultants Ltd. with
respect to Oil and Gas Properties formerly owned by UMC evaluating such
Properties as of January 1, 1998; (b) XxXxxxxx & Associates Consultants Ltd.
with respect to the Oil and Gas Properties of UMC Canada evaluating such
Properties as of January 1, 1998; (c) Netherland, Xxxxxx & Associates, Inc. with
respect to the Oil and Gas Properties of certain Subsidiaries of OEI named
therein conducting operations in Africa evaluating such Properties as of January
1, 1998; (d) Netherland, Xxxxxx & Associates with respect to the Oil and Gas
Properties of the Company evaluating such Properties as of December 31, 1997;
and (e) the chief petroleum engineer of the Company with respect to its Oil and
Gas Properties evaluating such Properties as of December 31, 1997.
"Intercreditor Agreement" shall mean that certain Intercreditor
Agreement of even date herewith among the Agents, the Lenders, the Canadian
Agent, the Canadian Lenders, OEI, the Company and UMC Canada, as amended from
time to time.
"Interest Coverage Ratio" shall mean the ratio, calculated as of the
last day of any fiscal quarter of OEI, of (a) EBITDA for the immediately
preceding four (4) fiscal quarters of OEI and its Consolidated Restricted
Subsidiaries ending on the date of determination to (b) interest expenses
(including capitalized interest expenses and excluding to the extent included in
the calculation of interest expenses, amortization of capitalized debt issuance
costs of OEI and its Consolidated Restricted Subsidiaries) on all Debt of OEI
and its Consolidated Restricted Subsidiaries for the immediately preceding four
(4) fiscal quarters of OEI and its Consolidated Restricted Subsidiaries ending
on the date of determination, after giving effect to the pooling of interests
treatment of the Merger; provided that if OEI or any Restricted Subsidiary shall
acquire any Person or acquire or dispose of any Properties outside the ordinary
course of business or engage in any other material transaction, interest expense
for the preceding four fiscal quarter period prior to such transaction may be
determined on a pro forma basis as if such transaction had occurred at the start
of such four fiscal quarter period.
-12-
"Interest Period" shall mean:
(a) with respect to any Eurodollar Loan, the period commencing on the
date such Eurodollar Loan is made or converted from a Base Rate Loan or the last
day of the next preceding Interest Period with respect to such Loan and ending
on the numerically corresponding day in the first, second, third or sixth
calendar month thereafter, as the Company may select as provided in Section 2.02
(or, in the case of a Conventional Loan that is a Eurodollar Loan, such longer
period as may be requested by the Company and agreed to by all of the Lenders,
and, in the case of a Bid Rate Loan that is a Eurodollar Loan, nine or twelve
months as may be requested by the Company and agreed to by the Lender making
such Loan), except that each Interest Period which commences on the last
Business Day of a calendar month (or on any day for which there is no
numerically corresponding day in the appropriate subsequent calendar month)
shall end on the last Business Day of the appropriate subsequent calendar month;
and
(b) with respect to any Absolute Rate Loan, the period commencing on
the date such Loan is made and ending on such day thereafter, of not less than
seven (7) days and not more than 360 days, as the Company may select as provided
in Section 2.02(g).
Notwithstanding the foregoing (unless, in the case of a Conventional
Loan that is a Eurodollar Loan, agreed to by the Company and all of the Lenders,
or, in the case of a Bid Rate Loan, the Company and the Lender making such
Loan): (i) no Interest Period for a Loan may end after the Termination Date;
(ii) each Interest Period which would otherwise end on a day which is not a
Business Day shall end on the next succeeding Business Day unless the next
succeeding Business Day falls in the next succeeding calendar month, then on the
next preceding Business Day; and (iii) notwithstanding clause (i) above, no
Interest Period for any Eurodollar Loans shall have a duration of less than one
month and, if the Interest Period for any Eurodollar Loans would otherwise be a
shorter period, such Loans shall not be available hereunder.
"LC Exposure" shall mean at any time the aggregate undrawn face amount
of all outstanding Letters of Credit and the aggregate of all amounts drawn
under Letters of Credit and not yet reimbursed or funded as a Loan pursuant to
Section 4.07(b), minus the aggregate face amount of all letters of credit issued
for the benefit of the Company or the Administrative Agent, which in each
instance has been specifically accepted by the Administrative Agent as
acceptable collateral supporting the Letters of Credit.
"LC Fee Rate" shall mean, as of any date of determination, the
Applicable Margin for Eurodollar Loans as of such date.
"Lender Group" shall mean collectively the Agents, the Lenders, the
Canadian Agent and the Canadian Lenders.
"Letter of Credit Agreements" shall mean the written agreements between
the Company and the Administrative Agent or one of its Affiliates executed or
hereafter executed in connection with the issuance by the Administrative Agent
or its Affiliate of the Letters of Credit, such agreements to be on the
Administrative Agent's or such Affiliate's customary form for letters of credit
of comparable amount and purpose, as from time to time in effect or as otherwise
agreed to by the Company and the Administrative Agent or its Affiliate.
-13-
"Letters of Credit" shall mean: (a) the letters of credit hereafter
issued by the Administrative Agent or one of its Affiliates on behalf of the
Lenders pursuant to Section 2.01(b), (b) all letters of credit heretofore issued
by the Administrative Agent, as agent, or one of its Affiliates under the Prior
Credit Agreements, which are outstanding on the date of the Initial Funding, and
(c) all reimbursement obligations pertaining to any such letters of credit; and
"Letter of Credit" shall mean any one of the Letters of Credit and the
reimbursement obligation pertaining thereto.
"Liens" shall mean, with respect to any asset, any mortgage, lien,
pledge, charge (including, without limitation, production payments and the like
payable out of Oil and Gas Properties), security interest or encumbrance of any
kind in respect of such asset. For the purposes of this Agreement, OEI and its
Subsidiaries shall be deemed to own subject to a Lien any asset which it has
acquired or holds subject to the interest of a vendor or lessor under any
conditional sale agreement, capital lease or other title retention agreement
relating to such asset.
"Lion" shall mean Lion GPL, S.A.
"Loan Documents" shall mean this Agreement, the Notes, the Letter of
Credit Agreements, the Guaranty Agreement, the Fee Letters, the agreements or
instruments described or referred to in Exhibit F, and any and all other
agreements or instruments now or hereafter executed and delivered by OEI, the
Company or any other Person (other than participation or similar agreements
between any Lender and any other lender or creditor with respect to any
Indebtedness or Canadian Indebtedness) in connection with, or as security for
the payment or performance of, the Notes, the Letter of Credit Agreements or
this Agreement, as such agreements may be amended or supplemented from time to
time.
"Loans" shall mean the Conventional Loans and Bid Rate Loans provided
for by Section 2.01.
"Long-Term Pari Passu Debt" shall mean, as of any date of
determination, any Pari Passu Debt that has no amortization of principal prior
to maturity and an initial final maturity of twenty (20) years or more as of the
date such Debt is issued.
"Majority Lenders" shall mean: (a) if no Event of Default has occurred
and is continuing, Lenders and Canadian Lenders (who are not in default of their
obligations under this Agreement or the Canadian Credit Agreement ) having,
without duplication, greater than fifty percent (50%) of the sum of the
Aggregate Commitments and the Canadian Subcommitments; and (b) if an Event of
Default has occurred and is continuing, Lenders and Canadian Lenders holding
(or, as to Letters of Credit, participating in) greater than fifty percent (50%)
of the outstanding aggregate principal amount of the Conventional Loans,
Canadian Indebtedness and Letters of Credit (without regard to any sale by a
Lender or a Canadian Lender of a participation in any Loan, Canadian
Indebtedness or Letter of Credit). For purposes of this determination, Canadian
dollar amounts shall be converted to Dollars at an exchange ratio specified in
the definition of "Available Canadian Subcommitment".
"Material Adverse Effect" shall mean any material and adverse effect
on: (a) the business, condition (financial or otherwise), results of operations,
assets, liabilities or prospects of OEI and its Restricted Subsidiaries on a
consolidated basis, (b) the ability of OEI and its Restricted Subsidiaries,
including the Company, to perform their obligations under the Loan Documents to
which they are party,
-14-
taken as a whole, or (c) the rights and remedies of the Agents and the Lenders
under the Loan Documents, taken as a whole.
"Merger" shall mean the merger pursuant to the Merger Agreement of
United Meridian into OEI, with OEI being the surviving Person.
"Multiemployer Plan" shall mean a Plan defined as such in Section 3(37)
of ERISA to which contributions have been made by OEI or any ERISA Affiliate and
which is covered by Title IV of ERISA.
"95 Indenture" shall mean that certain Indenture among OEI (as
successor by merger to United Meridian), as issuer, the Company (as successor by
merger to UMC), as initial subsidiary guarantor, and U.S. Bank Trust National
Association (formerly known as First Bank of New York, National Association), as
trustee, dated as of October 30, 1995, providing for the issuance of OEI's
$150,000,000 10-3/8% Senior Subordinated Notes due 2005, as amended by the First
Supplemental Indenture thereto dated as of November 4, 1997, and all notes or
securities issued under any of the foregoing, any subsidiary guarantees issued
pursuant to the terms of any of the foregoing, and all amendments and
supplements to the foregoing permitted under Section 9.19(b) or a consent
thereunder.
"96 Indenture" shall mean that certain Indenture dated as of September
26, 1996 among OEI (formerly known as Xxxxxx & Xxxxx, Inc.), as issuer, the
subsidiaries guarantors named therein, and State Street Bank and Trust Company,
as trustee, providing for the issuance of OEI's $160,000,000 9-3/4% Senior
Subordinated Notes due 2006 and all notes or securities issued under any of the
foregoing, any subsidiary guarantees issued pursuant to the terms of any of the
foregoing, and all amendments and supplements to the foregoing permitted under
Section 9.19(b) or a consent thereunder.
"97 Indenture" shall mean that certain Indenture dated as of July 2,
1997 among OEI, as issuer, the subsidiary guarantors named therein, and State
Street Bank and Trust Company, as Trustee, providing for the issuance of OEI's
$200,000,000 8-7/8% Senior Subordinated Notes due 2007 and all notes or
securities issued under any of the foregoing, any subsidiary guarantees issued
pursuant to the terms of any of the foregoing, and all amendments and
supplements to the foregoing permitted under Section 9.19(b) or a consent
thereunder.
"Non-recourse" with respect to an obligation and a Person shall mean
that such Person has no liability to the holder of such obligation for the
payment or repayment of such obligation, except that such Person may have
liability to the holder of such obligation for damages with respect to such
obligation arising out of fraudulent acts or omissions, willful
misrepresentations, willful misconduct and similar acts or omissions by such
Person.
"Non-Recourse Debt" shall mean Debt as to which neither OEI nor any of
its Restricted Subsidiaries (a) provides any guarantee or credit support of any
kind (including any undertaking, guarantee, indemnity, agreement or instrument
that would constitute Debt), or (b) is directly or indirectly liable (as
guarantor or otherwise), in each case, other than Debt permitted by Section
9.01(m).
-15-
"Norfolk" shall mean Norfolk Holdings Inc., a corporation duly formed
and existing under the laws of the state of Delaware, which is the parent of UMC
Canada and a direct Subsidiary of the Company.
"Notes" shall mean the Conventional Loan Notes and Bid Rate Notes,
together with any and all renewals, extensions for any period, increases,
rearrangements or replacements thereof.
"Oil and Gas Properties" shall mean Hydrocarbon Interests; the
Properties now or hereafter pooled or unitized with Hydrocarbon Interests; all
presently existing or future unitization or pooling agreements and declarations
of pooled units and the units created thereby (including without limitation all
units created under orders, regulations and rules of any Governmental Authority
having jurisdiction) which may affect all or any portion of the Hydrocarbon
Interests; all operating agreements, contracts and other agreements which relate
to any of the Hydrocarbon Interests or the production, sale, purchase, exchange
or processing of Hydrocarbons from or attributable to such Hydrocarbon
Interests; all Hydrocarbons in and under and which may be produced and saved or
attributable to the Hydrocarbon Interests, the lands covered thereby and all oil
in tanks and all rents, issues, profits, proceeds, products, revenues and other
incomes from or attributable to the Hydrocarbon Interests; all tenements,
hereditaments, appurtenances and Properties in anywise appertaining, belonging,
affixed or incidental to the Hydrocarbon Interests, Properties, rights, titles,
interests and estates described or referred to above, including any and all
Property, real or personal, now owned or hereinafter acquired and situated upon,
used, held for use or useful in connection with the operating, working or
development of any of such Hydrocarbon Interests or Property (excluding drilling
rigs, automotive equipment or other personal property which may be on such
premises for the purpose of drilling a well or for other similar temporary uses)
and including any and all oil xxxxx, gas xxxxx, injection xxxxx or other xxxxx,
buildings, structures, fuel separators, liquid extraction plants, plant
compressors, pumps, pumping units, field gathering systems, tanks and tank
batteries, fixtures, valves, fittings, machinery and parts, engines, boilers,
meters, apparatus, equipment, appliances, tools, implements, cables, wires,
towers, casing, tubing and rods, surface leases, rights-of-way, easements and
servitudes together with all additions, substitutions, replacements, accessions
and attachments to any and all of the foregoing.
"Operating Merger" shall mean the merger of UMC into the Company, with
the Company being the surviving Person.
"Pari Passu Debt" shall mean, as of any date of determination, any Debt
of OEI or the Company that is pari passu in right of payment to the
Indebtedness.
"Partnerships" shall mean the general and limited partnerships listed
on Exhibit E.
"Paying Agent" shall mean Chase Bank of Texas, National Association, in
its capacity as the Paying Agent under the Intercreditor Agreement.
"PBGC" shall mean the Pension Benefit Guaranty Corporation or any
entity succeeding to any or all of its functions under ERISA.
-16-
"Person" shall mean any individual, corporation, limited liability
company, voluntary association, partnership, joint venture, trust,
unincorporated organization or government or any agency, instrumentality or
political subdivision thereof, or any other form of entity.
"Plan" shall mean an employee pension benefit or other plan established
or maintained by OEI or any ERISA Affiliate and which is covered by Title IV of
ERISA, other than a Multiemployer Plan.
"Pledge of Production and Trust Agreements" shall mean collectively,
(i) that certain Pledge of Production Proceeds and Trust Agreements dated as of
May 12, 1993 among Shell Offshore Inc., the Company and First National Bank of
Commerce, New Orleans, Louisiana, as Trustee, as the same may from time to time
be amended, and (ii) that certain Pledge of Production Proceeds and Trust
Agreements dated as of May 12, 1992 among Shell Offshore Inc., the Company and
First National Bank of Commerce, New Orleans, Louisiana, as Trustee, as amended,
and as the same may be further amended from time to time.
"Post-Default Rate" shall mean, in respect of any principal of any Loan
or any other amount payable by OEI or the Company under this Agreement, any Note
or any Loan Document which is not paid when due (whether at stated maturity, by
acceleration or otherwise), a rate per annum during the period commencing on the
due date until such amount is paid in full or the default is cured or waived
equal to 2% per annum above the Base Rate as in effect from time to time plus
the Applicable Margin (if any), but in no event to exceed the Highest Lawful
Rate; provided that, if such amount in default is principal of a Eurodollar Loan
or Absolute Rate Loan and the due date is a day other than the last day of the
Interest Period therefor, the "Post-Default Rate" for such principal shall be,
for the period commencing on the due date and ending on the last day of the
Interest Period therefor, 2% per annum above the interest rate for such Loan as
provided in Section 3.02(a), but in no event to exceed the Highest Lawful Rate,
and thereafter, the rate provided for above in this definition.
"Prime Rate" shall mean the rate of interest from time to time
announced by the Administrative Agent at the Principal Office as its prime
commercial lending rate. Such rate is set by the Administrative Agent as a
general reference rate of interest, taking into account such factors as it may
deem appropriate, it being understood that many of the Administrative Agent's
commercial or other loans are priced in relation to such rate, that it is not
necessarily the lowest or best rate actually charged to any customer and that
the Administrative Agent may make various commercial or other loans at rates of
interest having no relationship to such rate.
"Principal Office" shall mean the principal office of the
Administrative Agent, presently located at 000 Xxxxxx, Xxxxxxx, Xxxxx 00000.
"Property" shall mean any interest in any kind of property or asset,
whether real, personal or mixed, or tangible or intangible.
"Quarterly Dates" shall mean the last day of each March, June,
September and December in each year, commencing June 30, 1998; provided that if
any such day is not a Business Day, then such Quarterly Date shall be the next
succeeding Business Day.
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"Redetermination Date" shall mean the annual or other date that the
redetermined Borrowing Base becomes effective.
"Redetermination Period" shall mean the period between any two
consecutive Redetermination Dates, regardless of the length of such period.
"Regulation D" shall mean Regulation D of the Board of Governors of the
Federal Reserve System (or any successor), as the same may be amended or
supplemented from time to time.
"Regulations G, T, U and X" shall mean Regulations G, T, U and X of the
Board of Governors of the Federal Reserve System (or any successor), as the same
may be amended or supplemented from time to time.
"Regulatory Change" shall mean, with respect to any Lender, any change
after the date of this Agreement in United States Federal, state or foreign law
or regulations (including Regulation D) or the adoption or making after such
date of any interpretations, directives or requests applying to a class of
lenders or insurance companies, including such Lender or its Applicable Lending
Office, of or under any United States Federal, state or foreign law or
regulations (whether or not having the force of law) by any court or
governmental or monetary authority charged with the interpretation or
administration thereof.
"Required Lenders" shall mean: (a) if no Event of Default has occurred
and is continuing, Lenders and Canadian Lenders (who are not in default of their
obligations under this Agreement or the Canadian Credit Agreement ) having,
without duplication, greater than sixty-six and two-thirds percent (66-2/3%) of
the sum of the Aggregate Commitments and the Canadian Subcommitments; and (b) if
an Event of Default has occurred and is continuing, Lenders and Canadian Lenders
holding (or, as to Letters of Credit, participating in) greater than sixty-six
and two-thirds percent (66-2/3%) of the outstanding aggregate principal amount
of the Conventional Loans, Canadian Indebtedness and Letters of Credit (without
regard to any sale by a Lender or a Canadian Lender of a participation in any
Loan, Canadian Indebtedness or Letter of Credit). For purposes of this
determination, Canadian dollar amounts shall be converted to Dollars at an
exchange ratio specified in the definition of "Available Canadian
Subcommitment".
"Required Payment" shall have the meaning assigned to that term in Section
4.04.
"Reserve Report" shall mean a report, in form and substance reasonably
satisfactory to the Technical Agents, setting forth, as of each January 1 and
July 1 (or such other date in the event of an unscheduled redetermination): (i)
the oil and gas reserves attributable to Oil and Gas Properties of OEI and its
Restricted Subsidiaries which OEI desires to include in the Borrowing Base,
together with a projection of the rate of production and future net income,
taxes, operating expenses and capital expenditures with respect thereto as of
such date, based upon the pricing assumptions consistent with SEC reporting
requirements at the time; and (ii) such other information as the Technical
Agents may reasonably request. The term "Reserve Report" shall also include the
information to be provided by the Company pursuant to Section 8.05(c).
"Restricted Subsidiary" shall at all times mean the Company, Norfolk,
UMC Canada and any other Subsidiary of OEI, whether existing on or after the
Effective Date, unless such Subsidiary is (i) an
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Unrestricted Subsidiary as of the Effective Date or is thereafter designated as
an Unrestricted Subsidiary in accordance with Section 9.21 or (ii) a Subsidiary
of an Unrestricted Subsidiary.
"Risk Management Agreements" shall mean any commodity, interest rate or
currency swap, rate cap, rate floor, rate collar, forward agreement or other
exchange, price or rate protection or risk management agreements or any option
with respect to any such transaction.
"SEC" shall mean the Securities and Exchange Commission or any
successor agency thereto.
"SEC Value" shall mean the future net revenues before income taxes from
proved reserves, estimated assuming that oil and natural gas prices and
production costs remain constant, then discounted at the rate of 10% per year to
obtain the present value.
"Share" of the Allocated Canadian Borrowing Base or the Allocated U.S.
Borrowing Base shall have the meaning set forth within such terms.
"Short-Term Pari Passu Debt" shall mean, as of any date of
determination, any Pari Passu Debt that is not Long Term Pari Passu Debt.
"Subordinated Debt" shall mean: (a) the Debt of OEI and the Company
under the Indentures and other Debt permitted under Section 9.01(e)(i); (b) the
obligations under or in connection with the Pledge of Production and Trust
Agreements; and (c) any Debt of OEI or the Company incurred in accordance with
the terms of Section 9.01(e)(iii).
"Subsidiary" shall mean, with respect to any Person, any corporation or
limited liability company of which at least a majority of the outstanding shares
of stock or interests having by the terms thereof ordinary voting power to elect
a majority of the board of directors of such corporation or a manager of such
limited liability company (irrespective of whether or not at the time stock or
interests of any other class or classes shall have or might have voting power by
reason of the happening of any contingency) is at the time directly or
indirectly owned or controlled by such Person or one or more of its Subsidiaries
or by such Person and one or more of the Subsidiaries.
"Tax" shall mean any present or future tax, levy, impost, duty, charge,
assessment or fee of any nature (including interest, penalties and additions
thereto) that is imposed by any government or other taxing authority in respect
of any payment under this Agreement (or, if applicable in the context, the
Canadian Credit Agreement) other than a stamp, registration, documentation or
similar tax.
"Tax Partnerships" shall mean partnerships or joint ventures arising
out of routine joint operating agreements or farmout agreements entered into
with OEI or any of its Restricted Subsidiaries with respect to Oil and Gas
Properties.
"Technical Agents" shall mean the Administrative Agent, the Syndication
Agent and the Documentation Agent.
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"Termination Date" shall mean March 31, 2003, unless the Commitments
are sooner terminated pursuant to Section 2.03(b) or Section 10.01, or extended
pursuant to Section 2.03(a).
"Threshold Amount" shall mean the amount determined as such by the
Technical Agents pursuant to Section 2.09.
"Total Debt" shall mean as of any date of determination, all Debt of
OEI and its Consolidated Restricted Subsidiaries of the types described in
clauses (a), (b) (but only letters of credit and bankers' acceptances), (c),
(d), (e) and (f) of the definition of "Debt", determined on a consolidated basis
in accordance with GAAP.
"Type" shall mean, with respect to any Loan, an Absolute Rate Loan, a
Eurodollar Loan or a Base Rate Loan, each being a "Type" of Loan.
"UMC Canada" shall mean UMC Resources Canada Ltd., a company
amalgamated under the laws of the Province of British Columbia.
"Unrestricted Subsidiary" shall mean, as of the Effective Date, each
Subsidiary of OEI specified as such on Exhibit D, and any other Subsidiary of
OEI which (i) the Board of Directors of OEI has determined will be designated an
Unrestricted Subsidiary as provided in Section 9.21 and (ii) is a Subsidiary of
an Unrestricted Subsidiary.
"Voting Stock" shall mean, with respect to any Person, any class or
classes of capital stock pursuant to which the holders thereof have the general
voting power under ordinary circumstances to elect at least a majority of the
board of directors, managers or trustees of any Person (irrespective of whether
or not, at the time, stock of any other class or classes shall have, or might
have, voting power by reason of the happening of any contingency).
"Wholly Owned Restricted Subsidiary" shall mean any Restricted
Subsidiary to the extent (i) all of the capital stock or other ownership
interests in such Restricted Subsidiary, other than any directors' qualifying
shares mandated by applicable law, is owned directly or indirectly by either OEI
or the Company or (ii) such Restricted Subsidiary is organized in a foreign
jurisdiction and is required by the applicable laws and regulations of such
foreign jurisdiction to be partially owned by the government of such foreign
jurisdiction or individuals or corporate citizens of such foreign jurisdiction
in order for such Restricted Subsidiary to transact business in such foreign
jurisdiction, provided that the Company, directly or indirectly, owns the
remaining capital stock or ownership interest in such Restricted Subsidiary and,
by contract or otherwise, controls the management and business of such
Restricted Subsidiary to substantially the same extent as if such Restricted
Subsidiary were a wholly owned Subsidiary.
Section 1.03 Accounting Terms and Determinations. Unless otherwise
specified herein, all accounting terms used herein shall be interpreted, all
determinations with respect to accounting matters hereunder shall be made, and
all financial statements and certificates and reports as to financial matters
required to be furnished to any Agent or the Lenders hereunder shall be
prepared, in accordance with GAAP, applied on a basis consistent with the
Financial Statements. Unless otherwise specified, all
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amounts referred to herein and in the other Loan Documents (other than the
Canadian Credit Agreement and any guaranty executed in connection with the
Canadian Credit Agreement) are in Dollars.
ARTICLE II
Commitments
Section 2.01 Loans and Letters of Credit.
(a) Conventional Loans.
(i) Each Lender severally agrees, on the terms and conditions of this
Agreement, to make revolving credit loans (each a "Conventional Loan")
to the Company during the period from and including the Effective Date
to and including the Termination Date, in an aggregate principal amount
at any one time outstanding up to but not exceeding the lesser of (1)
such Lender's Commitment and (2) the amount of such Lender's Share of
the Allocated U.S. Borrowing Base as then in effect; provided that the
aggregate principal amount of all Conventional Loans and all Bid Rate
Loans made by all of the Lenders hereunder at any one time outstanding
shall not exceed the Available U.S. Commitment, as then in effect,
minus the LC Exposure then outstanding. Subject to the terms of this
Agreement, during the period from the Effective Date to and including
the Termination Date, the Company may borrow, repay and reborrow the
amount of the Available U.S. Commitment as then in effect. Conventional
Loans may be Base Rate Loans or Eurodollar Loans.
(ii) Unless consented to in writing by the Administrative Agent, no
more than seven (7) Eurodollar Loans that are Conventional Loans may be
outstanding from each Lender at any time. For purposes of this Section
2.01(a)(ii), Eurodollar Loans having different Interest Periods,
regardless of whether they commence on the same date, shall be
considered separate Loans.
(b) Letters of Credit.
(i) During the period from and including the Effective Date to and
including the Termination Date, the Administrative Agent agrees, on
behalf of the Lenders, to extend credit to the Company by issuing,
renewing, extending or reissuing Letters of Credit for the account of
the Company or any of its Subsidiaries; provided that the aggregate LC
Exposure at any one time outstanding shall not exceed the lesser of (A)
the Available U.S. Commitment as then in effect minus the aggregate
amount of all Conventional Loans and Bid Rate Loans then outstanding or
(B) $50,000,000.
(ii) Each of the Letters of Credit shall (A) be issued by the
Administrative Agent or The Chase Manhattan Bank, an Affiliate of the
Administrative Agent, (B) contain such terms and provisions as are
reasonably required by the Administrative Agent in accordance with its
customary procedures, (C) be for the account of the Company or one of
its Subsidiaries, and (D) expire not later than the earlier of three
(3) years after the issue date of such Letter of Credit or five (5)
days before the Termination Date.
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(iii) In conjunction with the issuance of a Letter of Credit, the
Company shall execute a Letter of Credit Agreement. In the event of any
conflict between any provision of a Letter of Credit Agreement and this
Agreement, OEI, the Company, the Agents and the Lenders hereby agree
that the provisions of this Agreement shall govern. Such conflicts
include, without limitation, provisions in a Letter of Credit Agreement
providing for an interest rate different from the interest rate
provided in this Agreement and provisions in a Letter of Credit
Agreement requiring or relating to collateral to secure the obligations
thereunder.
(c) Bid Rate Loans.
(i) Each Lender severally agrees that the Company from time to time may
request one or more of the Lenders to make loans to the Company on a
non-pro rata basis (each a "Bid Rate Loan") in the manner set forth in
Section 2.02(g) during the period from and including the Effective Date
to and including the Termination Date; provided that (A) no Lender
shall be obligated to make Bid Rate Loans to the Company unless such
Lender has irrevocably offered to make a Bid Rate Loan pursuant to
Section 2.02(g)(iii); and (B) following the making of any Bid Rate Loan
by any Lender, the aggregate principal amount of all Conventional Loans
and all Bid Rate Loans made by all of the Lenders hereunder at any one
time outstanding shall not exceed the Available U.S. Commitment, as
then in effect, minus the LC Exposure then outstanding. Bid Rate Loans
may be Eurodollar Loans or Absolute Rate Loans. For purposes of this
Section 2.01(c)(i) and Section 2.02(g), Bid Rate Loans having different
Interest Periods, regardless of whether they commence on the same date,
shall be considered separate Loans.
(ii) The making of any Bid Rate Loan to the Company by any Lender shall
not be deemed to be a utilization of such Lender's Commitment (although
it shall be deemed to be a utilization of the Available U.S. Commitment
to effect the above stated limitation and for all other purposes of
this Agreement).
(d) Loans under Prior Credit Agreements. On the Effective Date:
(i) the Company shall pay all accrued and unpaid fees outstanding under
the Prior Credit Agreements for the account of each "Lender" under the
Prior Credit Agreements;
(ii) each "Base Rate Loan" and "Eurodollar Loan" under each Prior
Credit Agreement shall be deemed to be repaid with the proceeds of new
Loans under this Agreement;
(iii) all letters of credit issued under the Prior Credit Agreements
(which are scheduled on Schedule 2.01) shall be deemed to be issued
under Section 2.02(d) hereof as of the Effective Date; and
(iv) the Prior Credit Agreements and the commitments thereunder shall
be superseded by this Agreement and such commitments shall terminate.
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Section 2.02 Borrowings, Continuations and Conversions; Issuance of
Letters of Credit.
(a) Borrowings. The Company shall give the Administrative Agent (which
shall promptly notify the Lenders) advance notice as hereinafter provided of
each borrowing, continuation, and conversion hereunder of a Conventional Loan,
which shall specify the aggregate amount of such borrowing, continuation or
conversion, the Type and date (which shall be a Business Day) of the
Conventional Loans to be borrowed, continued or converted, and (in the case of
Eurodollar Loans) the duration of the Interest Period therefor.
(b) Minimum Amounts. All Base Rate Loans (as part of the same
borrowing) shall be in aggregate amounts among all Lenders of at least
$1,000,000 (or whole multiples thereof) or the remaining unused portion of the
Commitments. All Eurodollar Loans (as part of the same borrowing) shall be in
aggregate amounts among all Lenders of at least $3,000,000 (or a whole multiple
of $1,000,000 in excess thereof). All Bid Rate Loan borrowings under Section
2.02(g) shall be in amounts of at least $5,000,000.
(c) Notices, Etc. for Conventional Loans. All borrowings, continuations
and conversions relating to Conventional Loans shall require advance written
notice from the Company to the Administrative Agent, in the form of Exhibit C-1,
or such other form as may be accepted by the Administrative Agent from time to
time, which in each case shall be irrevocable and effective only upon receipt by
the Administrative Agent not later than (i) in the case of a Base Rate Loan,
11:00 a.m. Houston time on the date of such borrowing, continuation or
conversion; and (ii) in the case of a Eurodollar Loan, 12:00 noon Houston time
on a day which is not less than three (3) Business Days prior to the date of
such borrowing, continuation or conversion. Not later than 12:00 noon Houston
time on the date specified for each borrowing hereunder of a Conventional Loan,
each Lender shall make available the amount of the Conventional Loan to be made
by such Lender on such date to the Administrative Agent, at an account
maintained by the Administrative Agent at the Principal Office, in immediately
available funds for the account of the Company. The amounts so received by the
Administrative Agent shall, subject to the terms and conditions of this
Agreement, be made available to the Company by depositing the same, in
immediately available funds, in an account of the Company designated by the
Company and maintained with the Administrative Agent at the Principal Office.
(d) Letters of Credit. The Company shall give the Administrative Agent
(which shall promptly notify the Lenders) advance notice as provided in Section
2.02(c) not less than one (1) Business Day prior thereto of each request for the
issuance, renewal, or extension of a Letter of Credit hereunder which request
shall specify the amount of such Letter of Credit, the date (which shall be a
Business Day) such Letter of Credit is to be issued, renewed or extended, the
duration thereof, the beneficiary thereof, and such other terms as the
Administrative Agent may reasonably request, all of which shall be reasonably
satisfactory to the Administrative Agent. Subject to the terms and conditions of
this Agreement, on the date specified for the issuance, renewal or extension of
a Letter of Credit, the Administrative Agent shall issue such Letter of Credit
to the beneficiary thereof.
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(e) Continuation Options. Subject to the terms of this Agreement, the
Company may elect to continue all or any part of any Eurodollar Loan that is a
Conventional Loan beyond the expiration of the then current Interest Period
relating thereto by giving advance notice to the Administrative Agent of such
election, specifying the amount of such Eurodollar Loan to be continued and the
Interest Period therefor. In the absence of such a timely and proper election,
the Company shall be deemed to have elected to convert such Eurodollar Loan to a
Base Rate Loan. All or any part of any Eurodollar Loan may be continued as
provided herein, provided that (i) the principal amount of all or any part of a
Loan so continued shall be not less than $3,000,000 in the aggregate for all
Lenders and (ii) no Default shall have occurred and be continuing. If a Default
shall have occurred and be continuing, each Eurodollar Loan shall be converted
to a Base Rate Loan on the last day of the Interest Period applicable thereto.
The Company may not continue Bid Rate Loans.
(f) Conversion Options. The Company may elect to convert any Eurodollar
Loan that is a Conventional Loan on the last day of the then current Interest
Period relating thereto to a Base Rate Loan by giving advance notice to the
Administrative Agent of such election. Subject to the terms of this Agreement,
the Company may elect to convert all or any part of a Base Rate Loan that is a
Conventional Loan at any time and from time to time to a Eurodollar Loan by
giving advance notice to the Administrative Agent of such election. All or any
part of any outstanding Loan may be converted as provided herein, provided that
any conversion of any Base Rate Loan into a Eurodollar Loan shall be (as to each
such Loan into which there is a conversion for an applicable Interest Period) in
the principal amount not less than $3,000,000 in the aggregate for all Lenders.
If no Default shall have occurred and be continuing, each Loan may be converted
as provided in this Section. If a Default shall have occurred and be continuing,
no Loan may be converted into a Eurodollar Loan. The Company may not convert Bid
Rate Loans.
(g) Bid Rate Loans. The procedure for making Bid Rate Loans shall be as
follows:
(i) The Company may request Bid Rate Loans pursuant to this Section
2.02(g) from time to time from the Lenders by giving to the Competitive Bid
Auction Agent a notice of a proposed bid rate borrowing in substantially the
form of Exhibit C-2 hereto (a "Competitive Bid Request"), which notice shall be
given not later than 10:00 a.m., Houston time, on a Business Day not less than
four (4) Business Days prior to the proposed date the Bid Rate Loans are to be
borrowed if such Bid Rate Loans are Eurodollar Loans and not less than one (1)
Business Day prior to the proposed date the Bid Rate Loans are to be borrowed if
such Bid Rate Loans are Absolute Rate Loans. The Competitive Bid Request shall
specify the proposed date of the Bid Rate Loans to be borrowed (which shall be a
Business Day), the aggregate amount of the proposed Bid Rate Loans to be made,
which shall be not less than $5,000,000, the duration therefor, the Type, the
interest payment date or dates relating thereto, and any other terms to be
applicable to such Bid Rate Loan. The Company may request offers to make Bid
Rate Loans for up to three (3) different Interest Periods in a single
Competitive Bid Request. The terms of a Competitive Bid Request may not waive or
modify any of the conditions precedent set forth herein. The Competitive Bid
Auction Agent, as bid administrator, shall promptly notify the Administrative
Agent and each Lender of the Company's request for Bid Rate Loans by sending
each Lender a copy of the Competitive Bid Request.
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(ii) Each Competitive Bid Request must be in writing and may be
delivered (whether by the Company or the Competitive Bid Auction Agent as bid
administrator) by telegraph, telex, telecopy, other facsimile transmission or
other suitable means. All responses to any Competitive Bid Request shall be in
writing and may be delivered to the Competitive Bid Auction Agent by telegraph,
telex, telecopy, other facsimile transmission or other suitable means.
(iii) Upon receipt of such Competitive Bid Request, each Lender may,
if, in its sole discretion, it elects to do so, irrevocably offer to make one or
more Bid Rate Loans to the Company at a rate or rates of interest specified by
such Lender in its sole discretion by notifying the Competitive Bid Auction
Agent, as bid administrator (which shall promptly convey such response to the
Company), in writing by supplying a Bid Rate Quote in substantially the form of
Exhibit C-3 hereto of its decision not later than 2:00 p.m., Houston time, on
the Business Day not less than four (4) Business Days prior to the proposed date
the Bid Rate Loans are to be borrowed if such Bid Rate Loans are Eurodollar
Loans and before 10:00 a.m. Houston time on the same Business Day as the Bid
Rate Loans are to be borrowed if such Bid Rate Loans are Absolute Rate Loans
(provided that if the Administrative Agent, in its capacity as a Lender, desires
to submit a Bid Rate Quote, it shall on the relevant date submit its quote not
later than 1:45 p.m. and 9:45 a.m., respectively), of the minimum amount and
maximum amount of each Bid Rate Loan such Lender would be willing to make as
part of such proposed Bid Rate Loan (which shall be not less than $5,000,000),
the rate or rates of interest therefor, the Applicable Lending Office therefor,
if different, and the period of time during which such Lender's offer with
respect to such rate or rates of interest shall remain open. Such rate or rates
of interest may be either an Absolute Rate or based on the definition of
"Eurodollar Rate," adding or subtracting any margin which such Lender deems
appropriate. Unless otherwise agreed by the Competitive Bid Auction Agent and
the Company, no Bid Rate Quote shall contain qualifying, conditional or similar
language, propose terms other than or in addition to those set forth in the
relevant Competitive Bid Request, or be conditioned upon acceptance by the
Company of all of the Bid Rate Loans for which such offer is being made. Bid
Rate Quotes not in compliance with this clause (iii) may be disregarded by the
Company in its sole discretion.
(iv) The Company shall, in turn, not later than the expiration of the
period of time specified by such Lender during which its offer would remain open
(but in no event later than 10:30 a.m. Houston time on the Business Day that is
three (3) Business Days prior to the proposed borrowing date if such Bid Rate
Loans are Eurodollar Loans and not later than 11:00 a.m. Houston time on the
proposed borrowing date if such Bid Rate Loans are Absolute Rate Loans), in its
sole discretion, either (A) cancel its request by giving the Competitive Bid
Auction Agent, as bid administrator, notice to that effect, or (B) accept one or
more offers made by Lenders to make one or more Bid Rate Loans, in its sole
discretion, by giving notice to the Competitive Bid Auction Agent, as bid
administrator, of the amount of each Bid Rate Loan to be made by such Lender
(which amount shall be equal to or greater than the minimum amount and less than
or equal to the maximum amount, that such Lender specified to the Company for
such Bid Rate Loan pursuant to clause (iii) above, but in no event shall such
amount be less than $5,000,000). In the event the Company fails to cancel its
request or to accept the offer of a Lender to make one or more Bid Rate Loans
within the time periods specified in this clause (iv), the Company shall be
deemed to have canceled its request for such Bid Rate Loan. Upon notice that a
Competitive Bid Request has been canceled, the Competitive Bid Auction Agent, as
bid administrator, shall give prompt notice thereof to the Administrative Agent
and the Lenders.
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(v) The Company shall have no obligation to accept any offers, but if
the Company accepts offers, it shall do so on the basis of the lowest Bid Rate
offered; and in the event bids are equal, the Company may accept any such offers
in its sole discretion. If the Company accepts one or more of the offers made by
the Lenders, the Competitive Bid Auction Agent, as bid administrator, shall
promptly notify the Administrative Agent and each Lender whose offer was
accepted of the date and aggregate amount of such Bid Rate Loan and shall
promptly notify all other Lenders whose offers were not accepted of such fact.
The benefit of any notice or time periods specified above in this Section
2.02(g) relating to Bid Rate Loans from any Lender may be waived by the Company
or such Lender, as the case may be, without the consent or approval of the
Competitive Bid Auction Agent or any other Lender.
(vi) Not later than 1:00 p.m., Houston time, on the date specified for
each borrowing hereunder of a Bid Rate Loan, each Lender that has had its bids
accepted shall make available the amount of such Bid Rate Loan to be made by it
on such date to the Administrative Agent, at an account maintained by the
Administrative Agent at the Principal Office, in immediately available funds,
for the account of the Company. The amounts so received by the Administrative
Agent shall, subject to the terms and conditions of this Agreement, including
without limitation the satisfaction of all conditions precedent specified in
Section 6.02, be made available to the Company by depositing the same, in
immediately available funds, in an account of the Company, designated by the
Company, maintained with the Administrative Agent at the Principal Office.
(vii) If any Lender makes a new Bid Rate Loan hereunder on a day on
which the Company is to repay all or any part of any outstanding Bid Rate Loan
from such Lender, such Lender shall apply the proceeds of its new Bid Rate Loan
to make such repayment and only an amount equal to the difference (if any)
between such amount being borrowed and such amount being repaid shall be made
available by such Lender to the Company or remitted by the Company to such
Lender, as the case may be.
(viii) The indebtedness of the Company resulting from each Bid Rate
Loan made to the Company shall be evidenced by the records of each Lender making
a Bid Rate Loan and by the Bid Rate Note therefor. Such records shall be
presumed correct; provided that the failure of any Lender to make any such
notation on its Bid Rate Note shall not affect the Company's obligations in
respect of its Bid Rate Loan from such Lender.
(ix) All notices to any Lender required by this Section 2.02(g) shall
be made in accordance with Section 12.02 and the Competitive Bid Administrative
Questionnaire most recently placed on file by each Lender with the Competitive
Bid Auction Agent or the Administrative Agent.
(x) The Chase Manhattan Bank, an Affiliate of the Administrative Agent,
hereby agrees to be a party to this Agreement for the sole purpose of acting as
Competitive Bid Auction Agent and performing all duties assigned to the
Competitive Bid Auction Agent as the bid administrator hereunder.
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Section 2.03 Extensions and Changes of Commitments.
(a) Extension of Termination Date.
(i) At any time during the 60-day period beginning February
1st of a year and ending on April 1st of such year, the Company may request in
writing that, in connection with the forthcoming redetermination of the
Borrowing Base, the Lenders and the Canadian Lenders extend the Termination Date
for a period of one (1) additional year; provided, that any such extension shall
require the consent of all of the Lenders and the Canadian Lenders, which
consent may be withheld in each such Person's sole discretion; and provided,
further, that if any Lender or Canadian Lender has not responded to such request
in writing within 45 days after receipt of the written request of the Company by
the Administrative Agent, such failure shall be deemed a denial of said request.
(ii) Notwithstanding the foregoing clause (i), if the Required
Lenders (but not all Lenders and Canadian Lenders) have agreed to extend the
then applicable Termination Date as provided in Section 2.03(a)(i), then the
Company (or UMC Canada) may terminate, in whole but not in part, the Commitment
of any Lender or the Canadian Subcommitment of any Canadian Lender which has
refused to grant such extension (a "Terminated Lender") upon five (5) Business
Days' notice, during the period commencing on the expiration of the 45-day
notice period referred to above (or, if earlier, the date of receipt by the
Company of notice of such Terminated Lender's refusal) and ending on the date
thirty (30) days after the end of such 45-day period, by giving written notice
to the Terminated Lender and the Administrative Agent (or the Canadian Agent)
(such notice referred to herein as a "Notice of Termination"). In order to
effect the termination of the Commitment (or Canadian Subcommitment) of the
Terminated Lender, the Company (or UMC Canada) shall: (1) obtain an agreement
with one or more Lenders (or Canadian Lenders) to increase its respective
Commitment (or Canadian Subcommitment) and/or (2) request any one or more other
financial institutions to become parties to this Agreement (or the Canadian
Credit Agreement) in place of such Terminated Lender; provided, that any such
financial institution is reasonably acceptable to the Administrative Agent (or
the Canadian Agent) and becomes party to this Agreement (or the Canadian Credit
Agreement) by executing an Assignment and Acceptance (or its equivalent under
the Canadian Credit Agreement) (the Lender or other financial institutions that
agree to accept in whole or in part the Commitment (or Canadian Subcommitment)
of the Terminated Lender being referred to herein as the "Replacement Lender")
and to assume the Loans of the Terminated Lender, such that the aggregate
increased and/or accepted Commitments (or Canadian Subcommitments) of the
Replacement Lender(s) under clauses (1) and (2) equal the Commitment (or
Canadian Subcommitment) of the Terminated Lender. If the Company (or UMC Canada)
is unable to obtain one or more Replacement Lenders to accept the Commitment (or
Canadian Subcommitment) and to assume the Loans of the Terminated Lender, then,
if no Default or Event of Default has occurred at the time of such proposed
extension, the Company shall either elect by written notice to the
Administrative Agent to forego the requested extension or reduce the Aggregate
Commitments (or, if applicable, the aggregate Canadian Subcommitments) by an
amount equal to the Commitment (or Canadian Subcommitment) of the Terminated
Lender. (The failure to give such notice will be deemed an election by the
Company to forego the requested extension.) If a Default or Event of Default has
occurred and is continuing, no extension will be permitted without the consent
of all Lenders and the Canadian Lenders. Any assignment to a Replacement Lender
shall be effected pursuant to Section 12.06(b) or Section 12.03(b) of the
Canadian Credit Agreement, as applicable.
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(b) Optional Reduction. The Company shall have the right to terminate
or to reduce the Aggregate Commitments at any time or from time to time upon not
less than one (1) Business Day's prior written notice to the Administrative
Agent (which shall promptly notify the Lenders) of each such termination or
reduction, which notice shall specify the effective date thereof and the amount
of any such reduction (which shall not be less than $5,000,000, or any whole
multiple of $1,000,000 in excess thereof). Such notice shall be irrevocable and
effective only upon receipt by the Administrative Agent.
(c) Reinstatement. The Aggregate Commitments once terminated or reduced
may not be reinstated. The amount of the Available U.S. Commitment may increase
or decrease from time to time in accordance with the terms hereof, including,
but not limited to Section 2.09.
Section 2.04 Facility Fee and Other Fees.
(a) Facility Fee. The Company shall pay to the Administrative Agent for
the account of the Lenders a facility fee (the "Facility Fee") in an aggregate
amount equal to the Facility Fee Rate times an amount equal to the average daily
Available U.S. Commitment. The Facility Fee will accrue for the period from and
including the Effective Date to and including the Termination Date, without
regard to the outstanding principal amount of Loans outstanding. Accrued
Facility Fees shall be payable in arrears on each Quarterly Date and on the
Termination Date.
(b) Letter of Credit Fee. The Company agrees to pay to the
Administrative Agent for the account of the Lenders a quarterly fee for issuing
the Letters of Credit, calculated separately for each Letter of Credit, in an
aggregate amount for each Letter of Credit equal to 1/4 of the product of (i)
the LC Fee Rate, as then in effect, and (ii) the daily average balance during
such quarter of the amount of the Letter of Credit upon which drafts may be
drawn from time to time commencing on the date of issuance of such Letter of
Credit (or on the date of Initial Funding for Letters of Credit issued under the
Prior Credit Agreements and outstanding on the date of Initial Funding);
provided that each respective Letter of Credit shall bear an aggregate minimum
quarterly fee equal to $350, or such other fee as may be specifically agreed by
the Company and the Administrative Agent in each respective Letter of Credit
Agreement. All fees for all Letters of Credit (including all fees incurred for
any amendments to Letters of Credit) shall be payable in arrears on each
Quarterly Date.
(c) Issuing Fee. In addition to the fees described in Section 2.04(b),
the Company shall pay to the Administrative Agent for its own account a
quarterly fee for issuing each Letter of Credit, calculated separately for each
Letter of Credit, in an aggregate amount for each Letter of Credit equal to 1/4
of the product of (i) .125% per annum and (ii) the daily average balance during
such quarter of the amount of the Letter of Credit upon which drafts may be
drawn from time to time commencing on the date of issuance of such Letter of
Credit (or on the date of Initial Funding for Letters of Credit issued under the
Prior Credit Agreements and outstanding on the date of Initial Funding). All
fees for all Letters of Credit (including all fees incurred for any amendments
to Letters of Credit) shall be payable in arrears on each Quarterly Date.
(d) Competitive Bid Administration Fee. Upon delivery of each
Competitive Bid Request to the Administrative Agent, the Company shall pay to
the Competitive Bid Auction Agent, as bid
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administrator, for its own account, a bid administration fee of $1,000, which
fee shall be due and payable regardless of whether or not the Company cancels
its request or accepts any offers from any Lender.
(e) Fee Letters. The Company shall pay to the Administrative Agent and
its Affiliates and the Syndication Agent such other amounts as are set forth in
the Fee Letters on the dates set forth therein.
Section 2.05 Lending Offices. The Loans of each Type made by each
Lender shall be made and maintained at such Lender's Applicable Lending Office
for Loans of such Type.
Section 2.06 Several Obligations. The failure of any Lender to make any
Loan to be made by such Lender or to provide funds for disbursements under
Letters of Credit on the date specified therefor shall not relieve any other
Lender of its obligation to make its Loan or provide such funds on such date,
but no Lender shall be responsible for the failure of any other Lender to make a
Loan to be made by such other Lender or to provide funds to be provided by such
other Lender.
Section 2.07 Notes.
(a) Conventional Notes. The Conventional Loans made by each Lender
shall be evidenced by a single promissory note of the Company in substantially
the form of Exhibit A-1, dated as of the Effective Date or such later date that
a Lender becomes a party hereto, payable to the order of such Lender in a
principal amount equal to the maximum amount of its Commitment as originally in
effect and otherwise duly completed. The date, amount, Type and interest rate of
each Conventional Loan made by each Lender, and all payments made on account of
the principal thereof, shall be recorded by such Lender on its books and, prior
to any transfer of the Conventional Loan Note held by it, endorsed by such
Lender on the schedule attached to such Note or any continuation thereof;
provided that the failure of a Lender to make any notation shall not affect the
Company's obligations in respect of such Loan.
(b) Bid Rate Notes. The Bid Rate Loans made by each Lender shall be
evidenced by a single promissory note of the Company in substantially the form
of Exhibit A-2, dated as of the Effective Date or such later date that a Lender
becomes a party hereto, payable to such Lender and otherwise duly completed. The
date, amount, Type, interest rate and maturity date of each Bid Rate Loan made
by each Lender, and all payments made on account of the principal thereof, shall
be recorded by such Lender on its books and, prior to any transfer of the Bid
Rate Note held by it, endorsed by such Lender on the schedule attached to such
Note or any continuation thereof; provided that the failure of a Lender to make
any notation shall not affect the Company's obligations in respect of such Loan.
(c) No Right to Subdivide. No Lender shall be entitled to have its
Notes subdivided, by exchange for promissory notes of lesser denominations or
otherwise, except in connection with a permitted assignment of all or any
portion of such Lender's Commitment, Loans and Notes pursuant to Section
12.06(b).
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Section 2.08 Prepayments.
(a) Optional Prepayments. The Company may prepay Conventional Loans on
any Business Day upon notice to the Administrative Agent (which shall promptly
notify the Lenders), which notice (i) shall be given by the Company not later
than 12:00 noon Houston time on such Business Day, (ii) shall specify the amount
of the prepayment (which shall be not less than $1,000,000 or the remaining
balance of Base Rate Loans outstanding, if less) and (iii) shall be irrevocable
and effective only upon receipt by the Administrative Agent. Interest on the
principal prepaid, accrued to the prepayment date, shall be paid on the
prepayment date. Any prepayment of any Eurodollar Loans shall be subject to the
provisions of Section 5.05. The Company may not prepay Bid Rate Loans; provided
that the foregoing shall not prevent an acceleration of the maturity of a Bid
Rate Loan upon the occurrence and continuance of an Event of Default.
(b) Mandatory Prepayment Upon Reduction of Commitment. If, after giving
effect to any termination or reduction of the Aggregate Commitments pursuant to
Section 2.03, the sum of the outstanding aggregate principal amount of the Loans
and the LC Exposure exceeds the Aggregate Commitments, then the Company shall on
the date of such termination or reduction pay or prepay the amount of such
excess for application first, towards reduction of all amounts previously drawn
under Letters of Credit, but not yet funded as a Conventional Loan pursuant to
Section 4.07(b) or reimbursed, second, if necessary, towards reduction of the
outstanding principal balance of the Conventional Loan Notes by prepaying Base
Rate Loans, if any, then outstanding, third, if necessary, toward a reduction of
the outstanding principal balance of the Conventional Loan Notes by prepaying
Eurodollar Loans, if any, then outstanding, fourth, if necessary, paying such
amount to the Administrative Agent as cash collateral for outstanding Letters of
Credit, which amount shall be held by the Administrative Agent as cash
collateral to secure the Company's obligation to reimburse the Administrative
Agent and the Lenders for drawings under the Letters of Credit and fifth, if
necessary, paying such amount to the Administrative Agent as cash collateral for
outstanding Bid Rate Loans, which amount shall be held by the Administrative
Agent as cash collateral to secure the Company's obligation under such Loans.
The Company shall on the date of such termination or reduction also pay any
amounts payable pursuant to Section 5.05 in connection therewith.
(c) Mandatory Prepayment Upon Redetermination. Upon any adjustment or
redetermination of the amount of the Borrowing Base in accordance with (i)
Section 2.09, (ii) 8.05(d), (iii) 9.01(e), (iv) 9.01(h)(ii), (v) Section
9.01(o), (vi) Section 9.16(b) or (vii) Section 9.21 or otherwise, if the
adjusted or redetermined Borrowing Base is less than the sum of the aggregate
outstanding principal amount of the Loans, the LC Exposure and the Canadian
Indebtedness (a "Borrowing Base Deficiency"), then the Company shall within 90
days of receipt of written notice thereof either (i) take such steps as may be
approved by the Administrative Agent to increase the Borrowing Base by an amount
equal to or greater than the amount of such Borrowing Base Deficiency or (ii)
prepay the amount of such Borrowing Base Deficiency for application first,
towards reduction of all amounts previously drawn under Letters of Credit, but
not yet funded as a Conventional Loan pursuant to Section 4.07(b) or reimbursed,
second, if necessary, towards reduction of the outstanding principal balance of
the Conventional Loan Notes and Canadian Indebtedness by prepaying Base Rate
Loans, as defined herein and as defined in the Canadian Credit Agreement, if
any, then outstanding, third, if necessary, towards prepayment of Bankers'
Acceptances issued and outstanding under the Canadian Credit Agreement, fourth,
if necessary, towards
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a reduction of the outstanding principal balance of the Conventional Loan Notes
by prepayment of Eurodollar Loans, if any, then outstanding, fifth, if
necessary, towards payment of such amount to the Administrative Agent as cash
collateral for outstanding Letters of Credit, which amount shall be held by the
Administrative Agent as cash collateral to secure the Company's obligation to
reimburse the Administrative Agent and the Lenders for drawings under the
Letters of Credit and sixth, if necessary, towards payment of such amount to the
Administrative Agent as cash collateral for outstanding Bid Rate Loans, which
amount shall be held by the Administrative Agent as cash collateral to secure
the Company's obligation under such Loans. The Company shall also pay any
amounts payable pursuant to Section 5.05 in connection therewith.
(d) Prepayment Following Reallocation. Upon any reallocation of the
Borrowing Base in accordance with Section 2.09, if either (i) the Available U.S.
Commitment is less than the sum of the aggregate outstanding principal amount of
the Loans and the LC Exposure or (ii) the Available Canadian Subcommitment is
less than the Canadian Indebtedness, then in either case, the Company shall
within 90 days of receipt of written notice thereof, prepay the amount of such
excess in a manner consistent with the application order specified in Section
2.08(c).
(e) No Penalty or Premiums. Subject to compensation requirements of
Section 5.05, all prepayments shall be without premium or penalty.
Section 2.09 Borrowing Base.
(a) Allocation. (i) For the period from and including the
Effective Date to but not including the first Redetermination Date, the
amount of the Borrowing Base shall be $600,000,000 and the Threshold
Amount shall be $525,000,000. The Borrowing Base may not exceed the
Aggregate Commitments.
(ii) Subject to the terms of Section 2.09(a)(i), the Borrowing Base and
the Threshold Amount shall be determined in accordance with Sections
2.09(b), (c) and (d) by the Technical Agents with the approval or
deemed approval of the Required Lenders (provided that any increase in
the Borrowing Base shall require the approval or deemed approval of all
the Lenders and the Canadian Lenders). The Borrowing Base and the
Threshold Amount will be redetermined annually in accordance with
Section 2.09(b), commencing May 1, 1999. Upon any redetermination of
the Borrowing Base and the Threshold Amount, such redetermination shall
remain in effect until the next successive Redetermination Date.
(iii) The Borrowing Base may be allocated between the Company under
this Agreement and UMC Canada under the Canadian Credit Agreement.
Subject to the other terms of this Agreement, the Allocated U.S.
Borrowing Base in effect from time to time shall represent the maximum
amount of credit in the form of Loans and Letters of Credit (subject to
the Aggregate Commitments and the other provisions of this Agreement)
that the Lenders will extend to the Company at any one time prior to
the Termination Date. On the Effective Date, the Allocated Canadian
Borrowing Base shall be $7,000,000 resulting in an initial Allocated
U.S. Borrowing Base of $593,000,000.
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(iv) The Company at any time shall have the right to request in writing
to the Administrative Agent, Canadian Agent and the Canadian Lenders
that the Canadian Lenders, in their sole discretion, increase the
Allocated Canadian Borrowing Base; provided that any such increase
shall require the approval of all of the Canadian Lenders; and provided
further that the Company may not make such request more than three (3)
times during any twelve month period. Within ten (10) Business Days of
the receipt by the Canadian Lenders of such request, the Canadian
Lenders shall give written notice to the Company and the Administrative
Agent of their approval or disapproval of such increase. If such
increase is approved, each Lender which is also a Canadian Lender (or
who has an Affiliated Canadian Lender) shall have its pro rata share of
the Allocated U.S. Borrowing Base reduced by an amount equal to its
corresponding increase in the Allocated Canadian Borrowing Base. The
revised Allocated U.S. Borrowing Base and Allocated Canadian Borrowing
Base (and, if applicable, Commitment Percentages) shall become
effective upon the distribution by the Administrative Agent to the
Company, all Lenders and all Canadian Lenders of written notice thereof
which shall occur not later than three (3) Business Days after its
receipt of the notice of increase.
(v) The Company at any time shall have the right to request in writing
to the Administrative Agent, the Canadian Agent and the Lenders who are
also Canadian Lenders (or who have Affiliated Canadian Lenders) that
such Lenders who are also Canadian Lenders (or who have Affiliated
Canadian Lenders), in their sole discretion, permit the Company to
decrease the Allocated Canadian Borrowing Base; provided that any such
change shall require the approval of all of such Lenders; and provided
further that the Company may not make such request more than three (3)
times during any twelve month period. Within ten (10) Business Days of
the receipt by such Lenders of such request, such Lenders shall give
written notice to the Company and the Administrative Agent of their
approval or disapproval of such change. If such decrease is approved,
each such Lender shall have its pro rata share of the Allocated U.S.
Borrowing Base increased by an amount equal to its corresponding
decrease in the Allocated Canadian Borrowing Base. The revised
Allocated U.S. Borrowing Base and Allocated Canadian Borrowing Base
(and, if applicable, Commitment Percentages) shall become effective
upon the distribution by the Administrative Agent to the Company, all
Lenders and all Canadian Lenders of written notice thereof which shall
occur not later than three (3) Business Days after its receipt of the
notice of increase.
(vi) Reallocations of the Allocated U.S. Borrowing Base and Allocated
Canadian Borrowing Base may affect the Commitment Percentage set forth
on Annex I, but shall not, without the prior agreement of all the
Lenders and the Company, affect the Global Commitment Percentage.
(b) Redetermination. On or before April 1st of each year, commencing
April 1, 1999, the Technical Agents shall propose in writing to the Company, the
Lenders and the Canadian Lenders a new Borrowing Base and Threshold Amount in
accordance with Section 2.09(c) (assuming receipt by the Technical Agents of the
Engineering Reports in a timely and complete manner). After having received
notice of such proposal by the Technical Agents, each Lender and each Canadian
Lender shall have ten (10) days to agree with such proposal or disagree by
proposing an alternate Borrowing Base and Threshold Amount. If at the end of ten
(10) days, any Lender or Canadian Lender has not communicated its approval or
disapproval, such silence shall be deemed to be an approval. If, however, at the
end of such 10-day
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period, the Required Lenders have not approved or deemed to have approved, as
aforesaid, the proposed Borrowing Base and Threshold Amount, then the Borrowing
Base and Threshold Amount shall be determined in accordance with Section
2.09(d). After such redetermined Borrowing Base and Threshold Amount is approved
by the Required Lenders or is otherwise determined as provided in Section
2.09(d), it shall become effective and applicable to the Company, the Agents,
the Lenders and the Canadian Lenders as of the next succeeding May 1st.
(c) Engineering Reports. Upon receipt of the Reserve Reports and such
other reports, data, and supplemental information as may, from time to time, be
reasonably requested by the Required Lenders (the "Engineering Reports"),
together with a certificate from the President or chief financial officer of the
Company that, to the best of his knowledge and in all material respects, (i) the
information contained in the Engineering Reports is true and correct, (ii) the
certificate identifies the Properties covered by the Engineering Reports that
have not been previously included in any prior Engineering Reports, and (iii) no
other Oil and Gas Properties have been sold since the date of the last Borrowing
Base determination except as set forth on an exhibit to the certificate, which
certificate shall list all Oil and Gas Properties sold or disposed of in
compliance with Section 9.16 (or pursuant to a waiver thereof) and in such
detail as reasonably required by the Technical Agents, the Technical Agents will
evaluate such information. The Technical Agents, with the approval or deemed
approval of the Required Lenders as set forth in Section 2.09(b), but subject to
the terms of Section 2.09(d), shall redetermine the Borrowing Base and Threshold
Amount based upon such information and such other information (including,
without limitation, the Indebtedness) as the Technical Agents deem appropriate
and consistent with their normal oil and gas lending criteria as it exists at
the particular time (including, without limitation, the status of title
information with respect to Properties in the Engineering Reports and the
existence of any other Debt including, without limitation, the Debt of UMC
Canada under the Canadian Credit Agreement). Such redetermination shall be
accomplished not later than and effective as of the first (1st) day of each May
of each calendar year, assuming that the Company shall have furnished the
Engineering Reports in a timely and complete manner.
(d) Consensus and Failure of Consensus. Except as hereinafter provided,
the decision of the Required Lenders with respect to any Borrowing Base and
Threshold Amount determination shall control; however, if the Required Lenders
have not approved or are not deemed to have approved the Borrowing Base and the
Threshold Amount as of the date such a determination is called for in Section
2.09(b), the Technical Agents shall poll the Lenders and the Canadian Lenders to
ascertain the highest Borrowing Base and Threshold Amount then acceptable to a
number of Lenders and Canadian Lenders sufficient to constitute the Required
Lenders for purposes of this Section 2.09 and such amounts shall then become the
Borrowing Base and the Threshold Amount for the next Redetermination Period.
Notwithstanding the foregoing, however, any increase in the Borrowing Base and
the Threshold Amount shall require the consent of all the Lenders and the
Canadian Lenders.
(e) Interim Redeterminations. The Company may, at its option one time
during a 12 month period, initiate an interim redetermination of the Borrowing
Base and the Threshold Amount. The Administrative Agent (at the direction of the
Required Lenders, in their option) may, one time during any 12 month period,
initiate an interim redetermination of the Borrowing Base and the Threshold
Amount.
(f) Short-Term Pari Passu Debt; Other Adjustments.
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(i) The Technical Agents shall calculate the Borrowing Base and the
Threshold Amount for any Redetermination Period by (A) reducing the
amount which would have been the Borrowing Base in the absence of any
Short-Term Pari Passu Debt by an amount equal to the amount of Short-
Term Pari Passu Debt outstanding as of the Redetermination Date for
such Redetermination Period and (B) reducing the Threshold Amount by an
amount equal to the product of the amount of Short- Term Pari Passu
Debt outstanding as of the Redetermination Date for such
Redetermination Period and a fraction the numerator of which is the
amount which would have been the Threshold Amount but for the effect of
this clause (i) and denominator of which is the amount which would have
been the Borrowing Base but for the effect of this clause (i). In
addition, if during any Redetermination Period, any Short-Term Pari
Passu Debt is incurred or assumed, the amount of the then effective
Borrowing Base shall automatically reduce for the remainder of such
Redetermination Period by an amount equal to the amount of Short-Term
Pari Passu Debt so incurred or assumed and the Threshold Amount shall
likewise reduce in a pro rata fashion.
(ii) The Borrowing Base and the Threshold Amount are also subject to
adjustment as set forth in Sections 8.05(d), 9.01(e)(iii), 9.01(h)(ii),
9.01(o), 9.16(b) and 9.21.
ARTICLE III
Payments of Principal and Interest
Section 3.01 Repayment of Loans. The Company will pay on the
Termination Date to the Administrative Agent for the account of each Lender the
then-outstanding principal amount of each Conventional Loan made by such Lender.
Notwithstanding the foregoing sentence, each Bid Rate Loan will mature and be
payable in full on the last day of the Interest Period therefor and the Company
agrees to pay to the Administrative Agent for the account of the Lender making
such Bid Rate Loan the amount of such Bid Rate Loan in full on such day.
Section 3.02 Interest.
(a) The Company will pay to the Administrative Agent for the account of
each Lender interest on the unpaid principal amount of each Loan made by such
Lender for the period commencing on the date of such Loan to but excluding the
date such Loan shall be paid in full, at the following rates per annum:
(i) if such Loan is a Base Rate Loan, the Base Rate (as in effect from
time to time) plus the Applicable Margin for Base Rate Loans, but in no
event to exceed the Highest Lawful Rate;
(ii) if such Loan is a Eurodollar Loan that is a Conventional Loan, for
each Interest Period relating thereto, the Eurodollar Rate for such
Loan plus the Applicable Margin for Eurodollar Loans that are
Conventional Loans, but in no event to exceed the Highest Lawful Rate;
(iii) if such Loan is a Eurodollar Loan that is a Bid Rate Loan, for
each Interest Period relating thereto, the Eurodollar Rate for
Eurodollar Loans plus or minus any margin as may be agreed between the
Company and the Lender making such Bid Rate Loan, but in no event to
exceed the Highest Lawful Rate; and
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(iv) if such Loan is an Absolute Rate Loan, for each Interest Period
relating thereto, such rate per annum as may be agreed between the
Company and the Lender making such Bid Rate Loan, but in no event to
exceed the Highest Lawful Rate.
Notwithstanding the foregoing, the Company will pay to the
Administrative Agent for the account of each Lender interest at the applicable
Post-Default Rate on any principal of any Loan made by such Lender, and, to the
fullest extent permitted by law, on any other amount payable by OEI or the
Company hereunder or under any Loan Document, that shall not be paid in full
when due (whether at stated maturity, by acceleration or otherwise), for the
period commencing on the due date thereof until the same is paid in full, but in
no event to exceed the Highest Lawful Rate.
(b) Accrued interest on each Base Rate Loan shall be payable quarterly
on each Quarterly Date. Accrued interest on each Eurodollar Loan and Absolute
Rate Loan shall be payable on the last day of the Interest Period therefor and,
if such Interest Period is longer than three months or ninety (90) days, at
three-month or ninety (90) day intervals, as appropriate, following the first
day of such Interest Period. In any event, interest payable at the Post-Default
Rate shall be payable from time to time on demand and interest on any Eurodollar
Loan that is converted into a Base Rate Loan pursuant to Section 5.04 shall be
payable on the date of conversion (but only to the extent so converted).
(c) Promptly after the determination of any interest rate provided for
herein or any change therein, the Administrative Agent shall notify the Company
and the Lenders to which such interest is payable thereof. Upon notice to the
Administrative Agent of the incurrence of Debt pursuant to Section 8.01(g), the
incurrence of any Pari Passu Debt or Subordinated Debt and/or any change in the
amount of the Indebtedness (including the LC Exposure) outstanding hereunder or
the amount of the Canadian Indebtedness under the Canadian Credit Agreement, the
Administrative Agent shall promptly determine the Debt Coverage Ratio and, in
the event such circumstances result in a change in the Applicable Margin, the
Facility Fee Rate and the LC Fee Rate, the Administrative Agent shall notify the
Lenders and the Company. Such new Applicable Margin, the Facility Fee Rate and
the LC Fee Rate will be applicable until the next day on which events described
in this Section 3.02(c) result in a change and notice thereof is given by the
Administrative Agent.
ARTICLE IV
Payments; Pro Rata Treatment; Computations; Etc.
Section 4.01 Payments. Except to the extent otherwise provided herein,
all payments of principal, interest and other amounts to be made by the Company
under this Agreement, the Notes and other Loan Documents shall be made in
Dollars, in immediately available funds, to the Administrative Agent at an
account maintained by the Administrative Agent at the Principal Office, not
later than 1:00 p.m. Houston time on the date on which such payments shall
become due (each such payment made after such time on such due date to be deemed
to have been made on the next succeeding Business Day). The Company shall,
subject to Section 4.02, at the time of making each payment under this
Agreement, any Note or any other Loan Document, specify to the Administrative
Agent the Loans, Letters of Credit or other amounts payable by the Company
hereunder to which such payment is to be applied (and in the event that it fails
to so specify, and such day is not a Quarterly Date or other day on which a
payment of either interest or principal is due, then such payments shall be
applied in the following order: first, to interest
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accrued on Conventional Loans maintained as Base Rate Loans, second, any excess
to reduce the aggregate principal amount then outstanding on Conventional Loans
maintained as Base Rate Loans, third, any excess to interest accrued on
Conventional Loans maintained as Eurodollar Loans, and fourth any excess to
reduce the aggregate principal amount then outstanding on Conventional Loans
maintained as Eurodollar Loans; provided that if an Event of Default has
occurred and is continuing, the Administrative Agent may distribute such payment
to the Lenders in such manner as it or the Majority Lenders may determine to be
appropriate, subject to Section 4.02). Each payment received by the
Administrative Agent under this Agreement, any Note or any other Loan Document
for the account of a Lender shall be paid promptly to such Lender, in
immediately available funds, for account of such Lender's Applicable Lending
Office for the Loan, Letter of Credit or other amount in respect of which such
payment is made. Except as provided in clause (ii) of the provisions of the
definition of Interest Period, if the due date of any payment under this
Agreement, any Note or any other Loan Document would otherwise fall on a day
which is not a Business Day such date shall be extended to the next succeeding
Business Day and interest shall be payable for any principal so extended for the
period of such extension.
Section 4.02 Pro Rata Treatment. Except with respect to Bid Rate Loans
made by any Lender, as set forth in Sections 2.03(a)(ii) or Section 5.07(b) or
to the extent otherwise provided herein: (a) (i) each borrowing from the Lenders
under Section 2.01 shall be made from the Lenders in such amounts as may be
necessary so that, after giving effect to such borrowing, the outstanding
Conventional Loans shall have been made pro rata by the Lenders based on their
respective Commitment Percentages as then in effect, (ii) each payment of
Facility Fee or other fees under Sections 2.04(a) and (b) shall be made for the
account of the Lenders pro rata according to their respective Commitment
Percentages, and (iii) each termination or reduction of the amount of the
Commitments under Section 2.03 shall be applied to the Commitments of the
Lenders pro rata according to their respective Global Commitment Percentages
(or, if there is a contemporaneous and corresponding termination or reduction of
the amount of the Canadian Subcommitments, such amounts as may be necessary so
that, after giving effect to such reduction, the Global Commitment Percentages
shall have been reduced pro rata); (b) each payment of principal of Conventional
Loans by the Company shall be made for the account of the Lenders pro rata in
accordance with the respective unpaid principal amount of the Conventional Loans
held by the Lenders; (c) each payment of interest on Conventional Loans by the
Company shall be made for the account of the Lenders pro rata in accordance with
the amounts of interest due and payable on such Conventional Loans to the
respective Lenders; and (d) each reimbursement by the Company of disbursements
under Letters of Credit shall be made for the account of the Lenders pro rata in
accordance with the amounts of reimbursement obligations due and payable on such
Letters of Credit to the respective Lenders. If, on any day on which payments on
account of one or more Bid Rate Loans are due, payments on account of
Conventional Loans or on account of other items otherwise under this Agreement
are also due and the Administrative Agent has received insufficient funds to pay
all amounts due and owing on such date, then the Administrative Agent shall
distribute all funds so received first pro rata among the Lenders in accordance
with the unpaid amounts due on such day, and thereafter to the payment of such
Bid Rate Loans, pro rata.
Section 4.03 Computations. Interest on Eurodollar Loans and Absolute
Rate Loans shall be computed on the basis of a year of 360 days and actual days
elapsed (including the first day but excluding the last day) occurring in the
period for which such interest is payable (unless such calculation would result
in a rate of interest that would exceed the Highest Lawful Rate for any Lender
in which event such
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calculation for such Lender shall be computed on the basis of a year of 365 or
366 days, as the case may be). Interest on Base Rate Loans and fees shall be
computed on the basis of a year of 365 or 366 days, as the case may be, and
actual days elapsed (including the first day but excluding the last day)
occurring in the period for which payable.
Section 4.04 Non-receipt of Funds by the Administrative Agent. Unless
the Administrative Agent shall have been notified by a Lender or the Company
prior to the date on which a payment is scheduled to be made to the
Administrative Agent of (in the case of a Lender) the proceeds of a Loan to be
made by it hereunder or under a Letter of Credit or (in the case of the Company)
a payment to the Administrative Agent for account of one or more of the Lenders
hereunder (such payment being herein called a "Required Payment"), which notice
shall be effective upon receipt, that it does not intend to make the Required
Payment to the Administrative Agent, the Administrative Agent may assume that
the Required Payment has been made and may, in reliance upon such assumption
(but shall not be required to), make the amount thereof available to the
intended recipient(s) on such date. If such Lender or the Company (as the case
may be) has not in fact made the Required Payment to the Administrative Agent,
the recipient(s) of such payment shall, on demand, repay to the Administrative
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 Administrative Agent until the date the Administrative Agent
recovers such amount at a rate per annum equal to the Base Rate for such day,
but in no event to exceed the Highest Lawful Rate.
Section 4.05 Sharing of Payments, Etc.
(a) The Company agrees that, in addition to (and without limitation of)
any right of set-off, bankers' lien or counterclaim a Lender may otherwise have,
each Lender shall be entitled (after consultation with the Administrative
Agent), at its option, during the existence of an Event of Default, to offset
balances held by it for account of the Company at any of its offices, in Dollars
or in any other currency, against any principal of or interest on any of such
Lender's Loans or any other amount payable to such Lender hereunder or under any
other Loan Document which is not paid when due (regardless of whether such
balances are then due to the Company), in which case such Lender shall promptly
notify the Company and the Administrative Agent thereof, provided that such
Lender's failure to give such notice shall not affect the validity thereof.
(b) If any Lender shall obtain payment of any principal of or interest
on any Loan made by it to the Company under this Agreement or payment of any
reimbursement obligation under a Letter of Credit Agreement through the exercise
of any right of set-off, banker's lien or counterclaim or similar right or
otherwise, and, as a result of such payment, such Lender shall have received a
greater percentage of the principal or interest or reimbursement obligation then
due hereunder or under the respective Letter of Credit Agreement, as the case
may be, by the Company to such Lender than the percentage received by any other
Lenders, such Lender shall promptly purchase from such other Lenders
participations in (or, if and to the extent specified by such Lender, direct
interests in) the Loans made by such other Lenders (or in interest due thereon,
as the case may be) or reimbursement obligations under the Letter of Credit
Agreements in such amounts, and make such other adjustments from time to time as
shall be equitable, to the end that all the Lenders shall share the benefit of
such excess payment (net of any expenses which may be incurred by such Lender in
obtaining or preserving such excess payment) pro rata in accordance
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with the unpaid principal and/or interest on the Loans held by each of the
Lenders or pro rata in accordance with the unpaid reimbursement obligation owed
to each of the Lenders. To such end, all the Lenders shall make appropriate
adjustments among themselves (by the resale of participations sold or otherwise)
if such payment is rescinded or must otherwise be restored. The Company agrees
that any Lender so purchasing a participation (or direct interest) in the Loans
made by other Lenders (or in interest due thereon, as the case may be) or in the
reimbursement obligations owed to the other Lenders may exercise all rights of
set-off, bankers' lien, counterclaim or similar rights with respect to such
participation as fully as if such Lender were a direct holder of Loans or
reimbursement obligations, as the case may be, in the amount of such
participation. Nothing contained herein shall require any Lender to exercise any
such right or shall affect the right of any Lender to exercise, and retain the
benefits of exercising, any such right with respect to any other indebtedness or
obligation of the Company. If under any applicable bankruptcy, insolvency or
other similar law, any Lender receives a secured claim in lieu of a set-off to
which this Section 4.05 applies, such Lender shall, to the extent practicable,
exercise its rights in respect of such secured claim in a manner consistent with
the rights of the Lenders entitled under this Section 4.05 to share the benefits
of any recovery on such secured claim.
(c) Without limitation of the last sentence of Section 4.02, if an
Event of Default has occurred and is continuing and the Notes have been declared
to be immediately due and payable, the Administrative Agent shall distribute
funds received pro rata among the Lenders in accordance with the respective
unpaid principal amounts of the Loans (whether Conventional Loans or Bid Rate
Loans) held by the Lenders.
Section 4.06 Assumption of Risks. The Company assumes all risks of the
acts or omissions of beneficiaries of any of the Letters of Credit with respect
to its use of the Letters of Credit. Except in the case of gross negligence or
willful misconduct on the part of such Person or any of its employees, neither
the Administrative Agent, the Administrative Agent's correspondents, any other
Agent, nor any Lender shall be responsible: (a) for the validity or genuineness
of certificates or other documents, even if such certificates or other documents
should in fact prove to be invalid, fraudulent or forged; (b) for errors,
omissions, interruptions or delays in transmissions or delivery of any messages
by mail, telex, or otherwise, whether or not they be in code; (c) for errors in
translation or for errors in interpretation of technical terms; or (d) for any
other consequences arising from causes beyond the Administrative Agent's
control. In addition, neither the Administrative Agent, any other Agent nor any
Lender shall be responsible for any error, neglect, or default of any of the
Administrative Agent's correspondents which were chosen in good faith; and none
of the above shall affect, impair or prevent the vesting of any of the
Administrative Agent's rights or any Lender's rights or powers hereunder or
under the Letter of Credit Agreements, all of which rights shall be cumulative.
The Administrative Agent and the Administrative Agent's correspondents may
accept certificates or other documents that appear on their face to be in order,
without responsibility for further investigation. In furtherance and not in
limitation of the foregoing provisions, the Company agrees that any action,
inaction or omission taken or not taken by the Administrative Agent or any
correspondent in the absence of gross negligence or willful misconduct by the
Administrative Agent or any correspondent in connection with any Letter of
Credit, or any related drafts, certificates, documents or instruments, shall be
binding on the Company and shall not put the Administrative Agent or its
correspondents or any Lender under any resulting liability to the Company.
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Section 4.07 Obligation to Reimburse and to Prepay.
(a) If any draft or claim shall be presented for payment under a Letter
of Credit, after confirming that such draft or claim complies with all
requirements of the relevant Letter of Credit, the Administrative Agent shall
promptly notify the Company and each Lender orally (confirming such notice
promptly in writing) of the date and the amount of the draft or claim presented
for payment, the Business Day on which such draft or claim is to be honored and,
in the case of each Lender, the ratable share of such draft or claim
attributable to such Lender on the basis of its Commitment Percentage then in
effect.
(b) If a disbursement by the Administrative Agent is made under any
Letter of Credit and no Default under this Agreement shall have occurred and be
continuing, the Company may elect, and if no election is made, the Company shall
be deemed to have elected, to have the amount of such disbursement up to the
amount of the Available U.S. Commitment then available treated as a Conventional
Loan to the Company as provided in Section 2.01(a), subject to the terms and
conditions set forth in this Agreement. With respect to any disbursement under a
Letter of Credit after and during the continuance of a Default, the amount of
such disbursement shall be due and payable immediately and the Company shall pay
to the Administrative Agent, promptly after notice of such disbursement is
received by the Company, in federal or other immediately available funds, the
amount of such disbursement, together with interest on the amount disbursed from
and including the date of disbursement until payment in full of such disbursed
amount at a varying rate per annum equal to (i) the Base Rate (as in effect from
time to time) plus the Applicable Margin for Base Rate Loans (but in no event to
exceed the Highest Lawful Rate) for the first Business Day following the date of
such disbursement and (ii) the Post-Default Rate for Base Rate Loans for the
period from and including the second Business Day following the date of such
disbursement to and including the date of repayment in full of such disbursed
amount.
(c) The Company's obligation to make each such payment shall be
absolute and unconditional and shall not be subject to any defense or be
affected by any right of setoff, counterclaim or recoupment which the Company
may now or hereafter have against any beneficiary of any Letter of Credit, the
Administrative Agent, any other Agent, any Lender or any other Person for any
reason whatsoever (but, without prejudice to any other provisions hereof, any
such payment shall not waive, impair or otherwise adversely affect any claim, if
any, that the Company may have against any beneficiary of a Letter of Credit,
the Administrative Agent, any other Agent, any Lender or any other Person).
(d) If an Event of Default shall have occurred and be continuing, the
Company shall, upon request of the Majority Lenders, pay to the Paying Agent as
cash collateral an amount equal to the LC Exposure. The Company's obligation to
provide such cash collateral shall be absolute and unconditional without regard
to whether any beneficiary of any such Letter of Credit has attempted to draw
down all or a portion of such amount under the terms of a Letter of Credit. In
addition, the Company's obligation shall not be subject to any defense or be
affected by a right of setoff, counterclaim or recoupment which the Company may
now or hereafter have against any such beneficiary, any Agent, any Lender or any
other Person for any reason whatsoever (but, without prejudice to any other
provisions hereof, any such payment shall not waive, impair or otherwise
adversely affect any claim, if any, that the Company may have against any
beneficiary of a Letter of Credit, the Administrative Agent, any other Agent,
any Lender or any other Person). The Company hereby grants to the Paying Agent,
for the benefit of the Agents and the Lenders, a security interest in all such
cash to secure the LC Exposure and any and all other Indebtedness now or
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hereafter owing hereunder. If the Company shall provide cash collateral under
this Section 4.07 or shall prepay any Letter of Credit pursuant to Section 2.08
and thereafter either (i) drafts or other demands for payment complying with the
terms of such Letters of Credit are not made prior to the respective expiration
dates thereof, or (ii) such Event of Default shall have been waived or cured,
then the Agents and the Lenders agree that the Paying Agent is hereby
authorized, without further action by any other Agent or Lender, to release the
Lien in such cash and will direct the Paying Agent to remit to the Company
amounts for which the contingent obligations evidenced by such Letters of Credit
have ceased.
Section 4.08 Obligations for Letters of Credit.
(a) Immediately, (i) upon issuance of any Letter of Credit by the
Administrative Agent and (ii) effective on the date of the Initial Funding with
respect to Letters of Credit outstanding under the Prior Credit Agreements on
the date of Initial Funding, each Lender shall be deemed to be a participant
through the Administrative Agent in the obligation of the Administrative Agent
under such Letter of Credit. Upon the delivery by such Lender to the
Administrative Agent of funds requested for a disbursement pursuant to Section
4.08(c), such Lender shall be deemed as having purchased a participating
interest in the Company's reimbursement obligations with respect to such Letter
of Credit in an amount equal to such funds delivered to the Administrative
Agent.
(b) Each Lender severally agrees with the Administrative Agent and the
Company that it shall be unconditionally liable to the Administrative Agent,
without regard to the occurrence of any Default or Event of Default, for its pro
rata share, based upon its Commitment Percentage, of disbursements under any
Letter of Credit, and agrees to reimburse on demand the Administrative Agent for
its pro rata share of each such disbursement.
(c) The Administrative Agent shall promptly request from each Lender
its ratable share of any disbursement under any Letter of Credit that the
Company has not elected hereunder to treat as a Conventional Loan pursuant to
Section 4.07, which amount shall be made available by each Lender to the
Administrative Agent at the Principal Office in immediately available funds no
later than 2:00 p.m. Houston time on the date requested. If such amount due to
the Administrative Agent is made available later than 2:00 p.m. Houston time on
the date requested, then such Lender shall pay to the Administrative Agent such
amount with interest thereon in respect of each day during the period commencing
on the date such amount was requested until the date the Administrative Agent
receives such amount at a rate per annum equal to the Base Rate (but not to
exceed the Highest Lawful Rate).
ARTICLE V
Yield Protection and Illegality
Section 5.01 Additional Costs.
(a) Eurodollar Regulations. The Company shall pay directly to each
Lender such amounts as such Lender may determine to be necessary to compensate
it for any increased costs incurred by the Lender which such Lender determines
are attributable to its making or maintaining any Eurodollar Loans or its
obligation to make any Eurodollar Loans hereunder, or any reduction in any
amount receivable by such Lender hereunder in respect of any of such Loans or
such obligation (such increases in costs and
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reductions in amounts receivable being herein called "Additional Costs"),
resulting from any Regulatory Change which: (i) changes the basis of taxation of
any amounts payable to such Lender under this Agreement or its Notes in respect
of any of such Loans (other than franchise taxes, taxes on capital and/or gross
receipts or taxes imposed on the overall net income of such Lender or of its
Applicable Lending Office for any of such Loans by the jurisdiction in which
such Lender has its principal office or such Applicable Lending Office
("Excluded Taxes")); or (ii) imposes or modifies any reserve, special deposit,
minimum capital, capital ratio or similar requirements relating to any
extensions of credit or other assets of, or any deposits with or other
liabilities of, such Lender (including any of such Loans or any deposits
referred to in the definition of "Eurodollar Rate" in Section 1.02 hereof), or
any Commitment of such Lender; or (iii) imposes any other condition affecting
this Agreement or its Notes (or any of such extensions of credit or liabilities)
or Commitment.
(b) Suspension of Eurodollar Loans. If any Lender requests
compensation from the Company under Section 5.01(a), the Company may, by notice
to such Lender (with a copy to the Administrative Agent), suspend the obligation
of such Lender to make additional Loans of the Type with respect to which such
compensation is requested until the Regulatory Change giving rise to such
request ceases to be in effect (in which case the provisions of Section 5.04
shall be applicable). Without limiting the effect of the foregoing provisions of
this Section 5.01(b), in the event that, by reason of any Regulatory Change, any
Lender either (i) incurs Additional Costs based on or measured by the excess
above a specified level of the amount of a category of deposits or other
liabilities of such Lender which includes deposits by reference to which the
interest rate on Eurodollar Loans is determined as provided in this Agreement or
a category of extensions of credit or other assets of such Lender which includes
Eurodollar Loans or (ii) becomes subject to restrictions on the amount of such a
category of liabilities or assets which it may hold, then, such Lender may elect
by notice to the Company (with a copy to the Administrative Agent), to suspend
its obligation to make additional Eurodollar Loans until such Regulatory Change
ceases to be in effect (in which case the provisions of Section 5.04 shall be
applicable).
(c) Capital Adequacy. Without limiting the effect of Section 5.01(a)
and (b), but without duplication, after any Regulatory Change, the Company shall
pay directly to each Lender such amounts as such Lender may reasonably determine
to be necessary as a result of such Regulatory Change to compensate such Lender
(or its parent or holding company) for any costs which it determines are
attributable to the maintenance by such Lender (or its parent or holding company
or its Applicable Lending Office) of its capital in respect of its Commitment,
its Note, any Loans and/or any interest held by it in any Letter of Credit. Such
compensation shall include, without limitation, an amount equal to any reduction
of the rate of return on assets or equity of such Lender (or any Applicable
Lending Office) to a level below that which such Lender (or any Applicable
Lending Office) could have achieved but for such law, regulation,
interpretation, directive or request.
Section 5.02 Limitation on Eurodollar Loans. Notwithstanding any other
provision of this Agreement, if, on or prior to the determination of any
Eurodollar Rate for any Interest Period:
(a) the Administrative Agent determines (which determination shall be
conclusive, absent manifest error) that quotations of interest rates for the
relevant deposits referred to in the definition of "Eurodollar Rate" in Section
1.02 are not being provided in the relevant amounts or for the relevant
maturities for purposes of determining rates of interest for Eurodollar Loans as
provided herein; or
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(b) the Administrative Agent shall determine (which determination shall
be conclusive, absent manifest error) that the relevant rates of interest
referred to in the definition of "Eurodollar Rate" in Section 1.02 upon the
basis of which the rate of interest for Eurodollar Loans for such Interest
Period is to be determined are not sufficient to adequately cover the cost to
the Lenders of making or maintaining Eurodollar Loans;
then the Administrative Agent shall give the Company and each Lender prompt
notice thereof and so long as such condition remains in effect, the Lenders
shall be under no obligation to make additional Eurodollar Loans (in which case
the provisions of Section 5.04 shall be applicable).
Section 5.03 Illegality. Notwithstanding any other provision of this
Agreement, in the event that it becomes unlawful for any Lender or its
Applicable Lending Office to honor its obligation to make or maintain Eurodollar
Loans hereunder, then such Lender shall promptly notify the Company thereof
(with a copy to the Administrative Agent) and such Lender's obligation to make
Eurodollar Loans shall be suspended until such time as such Lender may again
make and maintain Eurodollar Loans (in which case the provisions of Section 5.04
shall be applicable).
Section 5.04 Base Rate Loans pursuant to Sections 5.01, 5.02 and 5.03.
If the obligation of any Lender to make Eurodollar Loans shall be suspended
pursuant to Section 5.01, 5.02 or 5.03 ("Affected Loans"), all Affected Loans
which would otherwise be made by such Lender shall be made instead as Base Rate
Loans (and, if an event referred to in Section 5.03 has occurred and such Lender
so requests by notice to the Company with a copy to the Administrative Agent,
all Affected Loans of such Lender then outstanding shall be automatically
converted into Base Rate Loans on the date specified by such Lender in such
notice). To the extent that Affected Loans are so made as (or converted into)
Base Rate Loans, all payments of principal which would otherwise be applied to
such Lender's Affected Loans shall be applied instead to the Loans so converted.
Section 5.05 Compensation. The Company shall pay to the Administrative
Agent for account of each Lender, upon the request of such Lender through the
Administrative Agent, such amount or amounts as shall be sufficient (in the
reasonable opinion of such Lender) to compensate it for any loss, cost or
expense which such Lender determines are attributable to:
(a) any payment, prepayment or conversion of a Eurodollar Loan for any
reason (including, without limitation, the acceleration of the Loans pursuant to
Section 10.01) on a date other than the last day of the Interest Period for such
Loan; or
(b) any failure by the Company for any reason (including but not
limited to, the failure of any of the conditions precedent specified in Article
VI to be satisfied, but excluding failures arising out of the negligence, gross
negligence or wilful misconduct of a Lender or Agent) to borrow, continue or
convert a Eurodollar Loan from such Lender on the date for such borrowing,
continuation or conversion specified in the relevant notice of borrowing given
pursuant to Section 2.02.
Without limiting the effect of the preceding sentence, such compensation shall
include an amount equal to the excess, if any, of (x) the amount of interest
which otherwise would have accrued on the principal amount so paid, prepaid or
converted for the period from the date of such payment, prepayment or
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conversion to the last day of the then current Interest Period for such Loan
(or, in the case of a failure to borrow, convert or continue, the Interest
Period for such Loan which would have commenced on the date specified for such
borrowing, conversion or continuation) at the applicable rate of interest for
such Loan provided for herein over (y) the interest component of the amount such
Lender would have bid in the London interbank market for Dollar deposits of
leading banks in amounts comparable to such principal amount and with maturities
comparable to such period (as reasonably determined by such Lender).
Section 5.06 Additional Cost in Respect of Tax.
(a) Payments Fee and Clear. Each payment to be made by the Company
hereunder or in connection herewith to any Agent or Lender or any other Person
shall be made free and clear of and without deduction for or on account of any
Tax unless the Company is required to make such payment subject to the deduction
or withholding of Tax, in which case (except for Excluded Taxes) the sum payable
by the Company in respect of which such deduction or withholding is required to
be made shall be increased to the extent necessary to ensure that, after the
making of such deduction or withholding, such Person receives and retains (free
from any liability in respect of any such deduction or withholding) a net sum
equal to the sum which it would have received and so retained had not such
deduction or withholding been made or required to be made.
(b) Obligation to Indemnify. If (i) any Agent or Lender is required by
law to make any payment on account of any Tax (except for Excluded Taxes) on or
in relation to any sum received or receivable hereunder by such Agent or Lender
or (ii) any liability in respect of any such payment is asserted, imposed,
levied or assessed against such Agent or Lender, then the Company shall promptly
pay to such Agent or Lender, as the case may be, any additional amounts
necessary to compensate it for such payment together with any interest,
penalties and expenses payable or incurred in connection therewith. If an Agent
or a Lender has paid over on account of Tax (other than Excluded Taxes) an
amount paid to it by the Company pursuant to the foregoing indemnification and
the amount so paid over is subsequently refunded to the recipient Agent or
Lender, in whole or in part, then the recipient Agent or Lender shall promptly
remit such amount refunded to the Company.
(c) Notice of Changes; Proof of Payment. If at any time the Company is
required by law to make any deduction or withholding from any sum payable by it
hereunder or in connection herewith (or if thereafter there is any change in the
rates at which or the manner in which such deductions or withholdings are
calculated), the Company shall promptly notify the Administrative Agent thereof.
If the Company makes any payment hereunder or in connection herewith for which
it is required by law to make any deduction or withholding, it shall pay the
full amount to be deducted or withheld to the relevant taxation or other
authority within the time allowed for such payment under applicable law and
shall deliver to the Administrative Agent within thirty (30) days after it has
made such payment to the applicable authority (i) a receipt issued by such
authority or (ii) other evidence reasonably satisfactory to the Administrative
Agent evidencing the payment to such authority of all amounts so required to be
deducted or withheld from such payment.
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Section 5.07 Avoidance of Taxes and Additional Costs.
(a) Change Applicable Funding Office. If a Lender makes any claim under
Section 5.01 or Section 5.06 in respect of Additional Costs of Taxes, such
Lender shall be obligated to use reasonable efforts to designate a different
Applicable Lending Office for the Commitment or the Loans of such Lender
affected by such event if such designation will avoid the need for, or reduce
the amount of, such compensation or the imposition of any Taxes and will not, in
the sole opinion of such Lender, be disadvantageous to such Lender; provided
that such Lender shall have no obligation to so designate an Applicable Lending
Office located in the United States.
(b) Replacement. If any Lender claims (i) payment of Additional Costs,
(ii) the inability to make or maintain the Eurodollar Rate for its Loans
pursuant to Section 5.01 or 5.03 (when such inability is not then being claimed
by substantially all of the Lenders) or (iii) payment of any Taxes pursuant to
Section 5.06, then the Company shall have the right, upon payment of such
requested Additional Costs or Taxes, if applicable, to (i) prepay the Loans made
by such Lender and terminate the Commitment of such Lender on a non pro rata
basis or (ii) subject to the approval of the Administrative Agent (such approval
not to be unreasonably withheld or delayed), find one or more Persons willing to
assume the Loans, Commitment and other obligations of such Lender and replace
such Lender pursuant to an Assignment and Acceptance. Any such assumption shall
be effected pursuant to Section 12.06(b). The Company shall not, however, be
entitled to replace any Lender if an event which with notice or lapse of time,
or both, would constitute a Default or an Event of Default exists at the time.
Section 5.08 Lender Tax Representation. Each Lender represents that it
is either (a) a corporation organized under the laws of the United States of
America or any state thereof or (b) entitled to complete exemption from United
States withholding tax imposed on or with respect to any payments, including
fees, to be made to it pursuant to this Agreement, the Notes and the other Loan
Documents (i) under an applicable provision of a tax convention to which the
United States of America is a party or (ii) because it is acting through a
branch, agency or office in the United States of America and any payment to be
received by it hereunder is effectively connected with a trade or business in
the United States of America. Each Lender that is not a corporation organized
under the laws of the United States of America or any state thereof agrees to
provide to the Company and the Administrative Agent on the Effective Date, or on
the date of its delivery of the Assignment and Acceptance pursuant to which it
becomes a Lender, and at such other times as required by United States law, two
accurate and complete original signed copies of either Internal Revenue Service
Form 4224 (or successor form) certifying that all payments to be made to it
hereunder will be effectively connected to a United States trade or business or
Internal Revenue Service Form 1001 (or successor form) certifying that it is
entitled to the benefit of a tax convention to which the United States of
America is a party which completely exempts from United States withholding tax
all payments to be made to it hereunder. If a Lender determines, as a result of
any Regulatory Change or other change in its circumstances, that it is unable to
submit any form or certificate that it is obligated to submit pursuant to this
Section 5.08, or that it is required to withdraw or cancel any such form or
certificate previously submitted, it shall promptly notify the Company and the
Administrative Agent of such fact.
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Section 5.09 Limitation on Right to Compensation. Any demand for
compensation pursuant to Article V (other than Section 5.06) must be made on or
before six (6) months after the Lender incurs the expense, cost or economic loss
referred to or such Lender shall be deemed to have waived the right to such
compensation. Any demand for compensation pursuant to Section 5.06 must be made
on or before twelve (12) months after the Lender incurs the expense, cost or
economic loss referred to or such Lender shall be deemed to have waived the
right to such compensation.
Section 5.10 Compensation Procedure. Each Lender will notify the
Administrative Agent and the Company of any event occurring after the date of
this Agreement which will entitle such Lender to compensation or indemnification
pursuant to this Article V as promptly as practicable after it obtains knowledge
thereof and determines to request such compensation. Each Lender will furnish
the Administrative Agent and the Company with a certificate setting forth the
basis and amount of each request by such Lender for compensation or
indemnification and specify the Section pursuant to which it is claiming
compensation or indemnification. Such certificate shall also include (i)
calculations in reasonable detail computing such claim, and (ii) a statement
from such Lender that it is asserting its right for indemnity or compensation
not solely with respect to the Indebtedness outstanding under this Agreement,
but is generally making such claims with respect to similar borrowers in
connection with transactions similar to the one contemplated in this Agreement.
Determinations and allocations by any Lender for purposes of this Article V of
the effect of any Regulatory Change pursuant to Sections 5.01(a) or (b), or of
the effect of capital maintained pursuant to Section 5.01(c), on its costs or
rate of return of maintaining Loans or issuing or participating in Letters of
Credit or its obligation to make Loans or issue or participate in Letters of
Credit, or on amounts receivable by it in respect of Loans or such obligations,
and of the additional amounts required to compensate such Lender under Section
5.01, 5.05 or 5.06, shall be conclusive, provided that such determinations and
allocations are made on a reasonable basis.
ARTICLE VI
Conditions Precedent
Section 6.01 Initial Funding. The obligation of the Lenders to make the
Initial Funding hereunder (which Initial Funding will include the refinancing of
the Debt outstanding under the Prior Credit Agreements and the assumption of the
obligations under all Letters of Credit outstanding under the Prior Credit
Agreements) is subject to the receipt by the Administrative Agent of the
following documents and satisfaction of the other conditions provided in this
Section 6.01, each of which shall be satisfactory to the Administrative Agent in
form and substance unless otherwise indicated:
(a) A certificate of the Secretary or Assistant Secretary of the
Company setting forth (i) that the resolutions of its board of directors
attached to such certificate are in full force and effect with respect to the
authorization of the execution, delivery and performance of the obligations
contained in the Notes, this Agreement and the other Loan Documents to which it
is a party, (ii) that the officers of the Company specified in such Secretary's
Certificate are authorized to sign this Agreement, the Notes, and the other Loan
Documents to which it is a party and who, until replaced by another officer or
officers duly authorized for that purpose, will act as the Company's
representative(s) for the purposes of signing documents and giving notices and
other communications in connection with this Agreement, the other Loan Documents
to which it is a party and the transactions contemplated hereby and thereby,
(iii) specimen signatures of the officers so authorized, and (iv) that attached
to such certificate are true and
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complete copies of the articles of incorporation and the bylaws of the Company.
The Agents and the Lenders may conclusively rely on such certificate until the
Administrative Agent receives notice in writing from the Company to the
contrary.
(b) A certificate of the Secretary or Assistant Secretary of OEI
setting forth (i) that the resolutions of its board of directors attached to
such certificate are in full force and effect with respect to the authorization
of the execution, delivery and performance of the obligations contained in the
Loan Documents to which it is a party, (ii) that the officers specified in such
Secretary's Certificate are authorized to sign the Loan Documents to which it is
a party and who, until replaced by another officer or officers duly authorized
for that purpose, will act as its representative(s) for the purposes of signing
documents and giving notices and other communications in connection with such
Loan Documents and the transactions contemplated thereby, (iii) specimen
signatures of the officers so authorized, and (iv) that attached to such
certificate are true and complete copies of the articles or certificate of
incorporation and the bylaws of OEI. The Agents and the Lenders may conclusively
rely on such certificate until the Administrative Agent receives notice in
writing from OEI to the contrary.
(c) Certificates of the appropriate state agencies with respect to the
existence, qualification and good standing of OEI, the Company and certain
material Restricted Subsidiaries in certain specified jurisdictions.
(d) The Notes, the Guaranty Agreement and the other Loan Documents
listed on Exhibit F, each duly completed and executed.
(e) The following opinions:
(i) an opinion of Akin, Gump, Strauss, Xxxxx & Xxxx, L.L.P., counsel to
OEI and the Company, substantially in the form of Exhibit B-1.
(ii) an opinion of Xxxxxxx, Xxxxxxx, Torian, Diaz, McNamera & Xxxxx,
special Louisiana counsel to the Company, substantially in the form of
Exhibit B-2.
(f) the Initial Reserve Reports.
(g) The Administrative Agent shall have received one or more
certificates or policies of insurance reflecting that OEI and its Restricted
Subsidiaries, including the Company, are carrying insurance consistent with the
requirements of this Agreement as to amounts, coverages and provisions.
(h) All conditions to closing the Canadian Credit Agreement shall have
been satisfied or waived contemporaneously with the Initial Funding.
(i) Evidence of termination of the Prior Credit Agreements and the
commitments thereunder.
(j) Appropriate UCC search certificates of OEI and its Restricted
Subsidiaries reflecting no Liens on any of their Properties except for such
Liens permitted by Section 9.02.
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(k) Satisfactory evidence that the Merger and the Operating Merger have
been consummated and that all Governmental Requirements reasonably necessary in
connection therewith have been obtained.
(l) The Lender Group shall have received all fees due and payable
pursuant to Section 2.04 on or prior to the Effective Date.
(m) Such other documents as the Administrative Agent or Technical
Agents or special counsel to the Administrative Agent may reasonably request.
Section 6.02 Subsequent Loans and Letters of Credit.
(a) Generally. The obligation of the Lenders to make Loans to the
Company upon the occasion of each borrowing hereunder (other than Base Rate
Loans which are made pursuant to the terms hereof solely to replace existing
Eurodollar Loans which have matured in the normal course on the last day of an
Interest Period therefor or pursuant to Section 5.03) or of the Administrative
Agent to issue Letters of Credit is subject to the further conditions precedent
that, as of the date of such Loans and after giving effect thereto: (i) no
Default or Event of Default shall have occurred and be continuing; (ii) no event
or circumstance having a Material Adverse Effect shall have occurred since the
date of the Financial Statements, and (iii) the representations and warranties
made by OEI and the Company in Article VII and the Loan Documents shall be true
in all material respects on and as of the date of the making of such Loans or
the issuance of such Letter of Credit with the same force and effect as if made
on and as of such date and following such new borrowing or issuance, except as
such representations and warranties are modified to give effect to transactions
expressly permitted hereby or to the extent expressly limited to an earlier
date.
(b) Certification as to Representations. Each notice of borrowing,
conversion or continuation and selection of an Interest Period (other than Base
Rate Loans which are made pursuant to the terms hereof solely to replace
existing Eurodollar Loans which have matured in the normal course on the last
day of an Interest Period therefor or pursuant to Section 5.03) or request for
the issuance, renewal, extension or reissuance of a Letter of Credit by the
Company hereunder shall constitute a certification by OEI and the Company to the
effect set forth in Section 6.02(a) (both as of the date of such notice and,
unless OEI or the Company otherwise notifies the Administrative Agent prior to
the date of or immediately following such borrowing or such issuance, as of the
date of such borrowing or issuance, as the case may be).
(c) Certificate Regarding Incurrence of Debt under Indentures. The
obligation of the Lenders to make Loans to the Company or of the Administrative
Agent to issue Letters of Credit, if, after giving effect thereto, the aggregate
principal amount of all the Loans then outstanding, the LC Exposure and the
Canadian Indebtedness would be in excess of $100,000,000, is subject to the
further condition precedent that OEI deliver a certificate from an authorized
officer, in form and substance reasonably satisfactory to the Administrative
Agent, certifying that, as of the date of incurrence, OEI is permitted to incur
such Indebtedness or Canadian Indebtedness under the Indentures and setting
forth in reasonable detail calculations to support the certification.
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Section 6.03 Conditions Relating to Letters of Credit. In addition to
the satisfaction of all other conditions precedent set forth in this Article VI,
the issuance, renewal, extension or reissuance of the Letters of Credit referred
to in Section 2.01(b) is subject to the following conditions precedent:
(a) At least one (1) Business Day prior to the date of the issuance,
renewal, extension or reissuance of each Letter of Credit, the Administrative
Agent shall have received a written request for a Letter of Credit as described
in Section 2.02.
(b) The Company shall have duly and validly executed and delivered to
the Administrative Agent a Letter of Credit Agreement pertaining to the Letter
of Credit.
ARTICLE VII
Representations and Warranties
OEI and the Company represent and warrant to the Agents and the Lenders
as follows:
Section 7.01 Corporate Existence. OEI, the Company, UMC Canada and each
Restricted Subsidiary: (a) is duly organized and validly existing under the laws
of the jurisdiction of its formation (or, if appropriate, the laws of the
jurisdiction under which it is continued); (b) has all requisite power, and has
all material governmental licenses, authorizations, consents and approvals
necessary to own its assets and carry on its business as now being conducted;
and (c) 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 so to qualify would have a Material Adverse Effect.
Section 7.02 Financial Condition.
(a) The unaudited pro forma combined balance sheet of OEI and its
Consolidated Subsidiaries as at December 31, 1997, consolidated for the
preceding fiscal year of OEI and United Meridian, which is presented to give
effect to the Merger under the pooling of interests method of accounting, as
reflected in XXX Xxxx X-0, and the related consolidated statement of income of
OEI and its Consolidated Subsidiaries for the fiscal period ended on said date,
heretofore furnished to each of the Lenders, fairly present in all material
respects the consolidated financial condition of OEI and its Consolidated
Subsidiaries and the consolidated results of their operations as at said date
and for the period stated (subject to the absence of a statement of changes in
stockholders' equity and cash flows). OEI believes that its assumptions
contained in the foregoing unaudited pro forma financial statements are
reasonable for presenting the significant financial and accounting effects
attributable to the Merger in accordance with SEC rules for such pro forma
financial statements.
(b) OEI and its Consolidated Subsidiaries, as of December 31, 1997, had
no material events of loss or casualties, material contingent liabilities,
liabilities for taxes, Liens, unusual forward or long-term commitments or
unrealized or anticipated losses from any unfavorable commitments, except as
referred to or reflected or provided for in the Financial Statements or
otherwise contemplated by this Agreement. Since December 31, 1997, there has
been no change or event which has had or could reasonably be expected to have a
Material Adverse Effect.
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Section 7.03 Litigation. Except as disclosed on Schedule 7.03, there
are no legal or arbitral proceedings or any proceedings by or before any
Governmental Authority, now pending or (to the knowledge of the Company and OEI)
threatened against OEI or any of its Restricted Subsidiaries, including the
Company, or against any of their respective Property which could reasonably be
expected to have a Material Adverse Effect or which would seek to enjoin or
prevent consummation of the Merger or the Operating Merger.
Section 7.04 No Breach. The execution and delivery by OEI and its
Restricted Subsidiaries, including the Company, of this Agreement, the Notes,
the other Loan Documents, the consummation of the transactions herein or therein
contemplated, including the Merger and the Operating Merger, and the compliance
with the terms and provisions hereof will not (a) conflict with or result in a
breach of, or require any consent under (i) the respective charter or by-laws of
such Person, or (ii) any applicable law or regulation, or any order, writ,
injunction or decree of any court or other Governmental Authority, or any
agreement or instrument to which any such Person is a party or by which it is
bound or to which it is subject, in each case in such manner as could reasonably
be expected to have a Material Adverse Effect; or (b) constitute a default under
any such agreement or instrument, or result in the creation or imposition of any
Lien upon any of the revenues or Property of such Person, in each case in such
manner as could reasonably be expected to have a Material Adverse Effect.
Section 7.05 Corporate Action; Binding Obligation. Each of OEI and the
Company has all necessary corporate power and authority to execute, deliver and
perform its respective obligations under this Agreement, the Notes and the Loan
Documents to which it is a party; and the execution, delivery and performance by
each of OEI and the Company of this Agreement, the Notes and the Loan Documents
to which it is party have been duly authorized by all necessary corporate action
on its part. This Agreement, the Notes and the Loan Documents to which it is a
party constitute the legal, valid and binding obligation of each of such Person,
enforceable against it in accordance with their terms, except as may be limited
by applicable bankruptcy, insolvency, reorganization or other similar laws
affecting creditors' rights and general principles of equity. Each of OEI and
United Meridian had all necessary corporate power and authority to execute,
deliver and perform its respective obligations under the Merger Agreement; and
the execution, delivery and performance by each such Person of its obligations
under the Merger Agreement were duly authorized by all necessary corporate
action on its part. Each of the Company and UMC had all necessary corporate
power and authority to perform the transactions contemplated by it under the
Merger Agreement; and performance by each such Person of the transactions
contemplated by it under the Merger Agreement were duly authorized by all
necessary corporate action on its part. On or prior to the Effective Date, the
Merger and the Operating Merger have been consummated.
Section 7.06 Approvals. Other than (i) Approvals heretofore obtained,
(ii) the Approvals described in the last sentence of this Section 7.06 and (iii)
Approvals the absence of which could not reasonably be expected to have a
Material Adverse Effect, no authorizations, approvals or consents of, and no
filings or registrations with, any Governmental Authority ("Approvals") are
necessary for the execution, delivery or performance by OEI or the Company of
this Agreement, the Notes, the Loan Documents to which it is a party, the Merger
and the Operating Merger or for the validity or enforceability thereof. It is
understood that continued performance by OEI and its Subsidiaries, including the
Company, of this Agreement and the other Loan Documents to which such Persons
are a party will require various Approvals, such as filings related to
environmental matters, ERISA matters, Taxes and intellectual
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property, filings required to maintain corporate and similar standing and
existence, filings pursuant to the Uniform Commercial Code and other security
filings and recordings, filings required by the SEC, routine filings in the
ordinary course of business, and filings required in connection with the
exercise by the Lenders and the Agents of remedies in connection with the Loan
Documents.
Section 7.07 Use of Loans and Letters of Credit. The proceeds of the
Loans and the Letters of Credit shall be used by the Company for general
corporate purposes of the Company and its Subsidiaries, including without
limitation, (i) the acquisition of Oil and Gas Properties and related Property
and Persons owning Oil and Gas Properties and related Property; (ii) the
refinancing of the Debt outstanding under the Prior Credit Agreements; (iii) the
financing of OEI's and its Subsidiaries' share of North American and
international oil and gas exploration, development and production costs; (iv)
the financing of purchases of Subordinated Debt issued under the 95 Indenture
which is tendered to OEI pursuant to a Change of Control Offer under the 95
Indenture; (v) the financing of ongoing working capital requirements of OEI and
its Subsidiaries; and (vi) the making of other payments as otherwise permitted
under this Agreement. Neither OEI nor any of its Subsidiaries, including the
Company, is engaged principally, or as one of its important activities, in the
business of extending credit for the purpose, whether immediate, incidental or
ultimate, of buying or carrying margin stock within the meaning of Regulation G,
T, U or X and no part of the proceeds of any Loan hereunder will be used to buy
or carry any margin stock.
Section 7.08 ERISA. Except as set out in Schedule 7.08, each of OEI and
the ERISA Affiliates (a) have fulfilled its respective obligations under the
minimum funding standards of ERISA and the Code with respect to each Plan, (b)
are in compliance, with respect to each Plan, in all material respects with the
presently applicable provisions of ERISA and the Code, and (c) have not incurred
any liability to the PBGC or any Plan or Multiemployer Plan. Except as set out
in Schedule 7.08, OEI and its Subsidiaries, including the Company, have no ERISA
Affiliates.
Section 7.09 Taxes. Each of OEI and its Subsidiaries, including the
Company, has filed all United States Federal income tax returns and all other
material tax returns which are required to be filed by it and has paid all taxes
due pursuant to such returns or pursuant to any assessment received by it,
except for such taxes as are being contested in good faith by appropriate
proceedings and for which adequate reserves are being maintained. The charges,
accruals and reserves on the books of OEI and its Subsidiaries, including the
Company, in respect of taxes and other governmental charges are, in the opinion
of OEI, adequate.
Section 7.10 Insurance. OEI has, and has caused all its Restricted
Subsidiaries to, have (a) all insurance policies sufficient for the compliance
by each of them with all material Governmental Requirements, and (b) insurance
coverage in at least such amounts and against such risks (including public
liability) that are usually insured against by companies similarly situated
engaged in the same or a similar business for the assets and operations of OEI
and its Restricted Subsidiaries, including the Company.
Section 7.11 Titles, etc. OEI and its Restricted Subsidiaries,
including the Company, own the material Oil and Gas Properties included in the
Borrowing Base, free and clear of all Liens except Liens permitted under Section
9.02. Other than Liens permitted under Section 9.02, OEI (directly or indirectly
through the Company and its other Restricted Subsidiaries) will own in the
aggregate, in all material
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respects, the net interests in production attributable to the xxxxx and units
evaluated in the Initial Reserve Reports. The ownership of such Properties shall
not in the aggregate in any material respect obligate OEI and its Restricted
Subsidiaries to bear the costs and expenses relating to the maintenance,
development and operations of such Properties in an amount materially in excess
of the working interest of such Properties set forth in the Initial Reserve
Reports. OEI has, or has caused its Restricted Subsidiaries to, pay all
royalties payable under the Hydrocarbon Interests to which it is operator,
except those contested in accordance with the terms of the applicable joint
operating agreement or otherwise contested in good faith by appropriate
proceedings. Upon delivery of each Reserve Report furnished to the Lenders
pursuant to Sections 8.05(a) or (b), the statements made in the preceding
sentences of this Section 7.11 shall be true with respect to such Reserve
Reports. All information contained in the Initial Reserve Reports is true and
correct in all material respects as of the date thereof.
Section 7.12 No Material Misstatements. At the time delivery is made,
no information, exhibit or report furnished to any Agent or Lender by OEI or any
of its Restricted Subsidiaries in connection with the negotiation of this
Agreement or any Loan Document contained any material misstatement of fact or
omitted to state a material fact or any fact necessary to make the statement
contained therein not materially misleading. Notwithstanding the foregoing, the
financial statements described in Section 7.02 and Section 8.01 shall be subject
to the standards set forth in Section 7.02.
Section 7.13 Investment Company Act. Neither OEI nor any of its
Subsidiaries, including the Company, is an "investment company" or a company
"controlled" by an "investment company," within the meaning of the Investment
Company Act of 1940, as amended.
Section 7.14 Public Utility Holding Company Act. Neither OEI nor any of
its Subsidiaries, including the Company, 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," or a "public
utility" within the meaning of the Public Utility Holding Company Act of 1935,
as amended.
Section 7.15 Subsidiaries and Partnerships. Except as shown in Exhibit
D, (a) OEI has no Subsidiaries, (b) OEI owns 100% of all of the issued and
outstanding shares of each class of stock issued by each of its Subsidiaries,
and (c) all Subsidiaries of OEI are Restricted Subsidiaries. OEI and its
Subsidiaries have no interest in any partnerships other than Tax Partnerships
and the partnerships identified in Exhibit E.
Section 7.16 Location of Business and Offices. The principal place of
business and chief executive offices of OEI and each its Subsidiaries, including
the Company, are located at either the address stated on the signature page of
this Agreement or on Exhibit D.
Section 7.17 Rate Filings. To the best of the Company's knowledge, (a)
neither the Company nor any of its Restricted Subsidiaries have violated any
provisions of The Natural Gas Act or any other Federal or State law or any of
the regulations thereunder, including those of any Governmental Authority having
jurisdiction over the Oil and Gas Properties of the Company or such Restricted
Subsidiary, which violation could reasonably be expected to have a Material
Adverse Effect; and (b) the Company and its Restricted Subsidiaries have made
all necessary rate filings, certificate applications, well category filings,
interim collection filings and notices, and any other filings or certifications,
and have received all
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necessary regulatory authorizations (including without limitation necessary
authorizations, if any, with respect to any processing arrangements conducted by
any one of them or others respecting said Oil and Gas Properties or production
therefrom) required under said laws and regulations with respect to all of the
Oil and Gas Properties or production therefrom so as not to have a Material
Adverse Effect. To the best of the Company's knowledge, said material rate
filings, certificate applications, well category filings, interim collection
filings and notices, and other filings and certifications contain no untrue
statements of material facts nor do they omit any statements of material facts
necessary in said filings.
Section 7.18 Environmental Matters. Except as provided in Schedule 7.18
or as would not have a Material Adverse Effect (or with respect to (c), (d), and
(e) below, where the failure to take such actions would not have such a Material
Adverse Effect):
(a) Neither any Property of OEI and its Subsidiaries, including the
Company, nor the operations conducted thereon violate any Environmental Laws or
order of any court or Governmental Authority with respect to Environmental Laws;
(b) Without limitation of Section 7.18(a), no Property of OEI and its
Subsidiaries, including the Company, nor the operations conducted thereon
(including operations by any prior owner or operator of such Property), are in
violation of or subject to any existing, pending or (to the knowledge of either
OEI or the Company) threatened action, suit, investigation, inquiry or
proceeding by or before any court or Governmental Authority with respect to
Environmental Laws or to any remedial obligations under Environmental Laws;
(c) All notices, permits, licenses or similar authorizations, if any,
required to be obtained or filed in connection with the operation or use of any
and all Property of OEI and its Subsidiaries, including without limitation past
or present treatment, storage, disposal or release of a hazardous substance or
solid waste into the environment, have been duly obtained or filed;
(d) All hazardous substances generated at any and all Property of OEI
and its Subsidiaries, including the Company, have in the past been transported,
treated and disposed of only by carriers maintaining valid permits under RCRA
and any other Environmental Law and only at treatment, storage and disposal
facilities maintaining valid permits under RCRA and any other Environmental Law,
which carriers and facilities (to the best knowledge of OEI and the Company)
have been and are operating in compliance with such permits;
(e) OEI and its Subsidiaries, including the Company, have taken all
steps necessary to determine and have determined that no hazardous substances or
solid waste have been disposed of or otherwise released and there has been no
threatened release of any hazardous substances on or to any Property of OEI and
its Subsidiaries, including the Company, except in compliance with Environmental
Laws; and
(f) OEI and its Subsidiaries, including the Company, have no material
liability in connection with any release or threatened release of any hazardous
substance or solid waste into the environment.
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(g) To the extent applicable, OEI and its Subsidiaries, including the
Company, have complied with all financial responsibility, spill prevention
facility design, operation and equipment requirements imposed by OPA or will
comply with such requirements scheduled to be imposed by OPA in the future
during the term of this Agreement; and OEI has no reason to believe that either
it or its Subsidiaries will not be able to maintain compliance with all
applicable OPA requirements during the term of this Agreement.
Section 7.19 Defaults. OEI and its Restricted Subsidiaries, including
the Company, are not in default and no event or circumstance has occurred which,
but for the passage of time or the giving of notice, or both, would constitute a
default under any agreement or other instrument to which either OEI or any of
its Restricted Subsidiaries, including the Company, is a party or by which it is
bound in any manner that could reasonably be expected to have a Material Adverse
Effect. No Default or Event of Default hereunder has occurred and is continuing.
Section 7.20 Compliance with the Law. OEI and its Restricted
Subsidiaries, including the Company, have not violated any Governmental
Requirement or failed to obtain any license, permit, franchise or other
governmental authorization necessary for the ownership of any of their
respective Properties or the conduct of their respective business which
violation or failure could reasonably be expected to have a Material Adverse
Effect.
Section 7.21 Risk Management Agreements. Schedule 7.21 sets forth, as
of the Effective Date, a true and complete list of all Risk Management
Agreements (including commodity price swap agreements, forward agreements or
contracts of sale which provide for prepayment for deferred shipment or delivery
of oil, gas or other commodities) of OEI and its Restricted Subsidiaries, the
material terms thereof (including the type, term, effective date, termination
date and notional amounts or volumes), the net xxxx to market value thereof, all
credit support agreements relating thereto (including any margin required or
supplied), and the counterparty to each such agreement.
Section 7.22 Gas Imbalances. As of the Effective Date, except as set
forth on Schedule 7.22 or on the most recent certificate delivered pursuant to
Section 8.05(c), on a net basis there are no gas imbalances, take or pay or
other prepayments with respect to OEI and its Restricted Subsidiaries' Oil and
Gas Properties which would require OEI or such Subsidiary to deliver
Hydrocarbons produced from the Oil and Gas Properties at some future time
without then or thereafter receiving substantially full payment therefor
exceeding 10,000,000 mcf of gas in the aggregate.
Section 7.23 Solvency. OEI (a) is not insolvent as of the date hereof
and will not be rendered insolvent as a result of the Merger, the execution,
delivery and performance of the Guaranty Agreement or the making of the Loans or
issuance of Letters of Credit hereunder, (b) is not engaged in business or a
transaction, or about to engage in a business or a transaction, for which it has
unreasonably small capital, and (c) does not intend to incur, or believe it will
incur, debts that will be beyond its ability to pay as such debts mature.
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ARTICLE VIII
Affirmative Covenants
OEI and the Company agree that, so long as any of the Commitments are
in effect and until payment in full of all Loans hereunder, all interest thereon
and all other amounts payable by OEI or the Company hereunder or any Loan
Document:
Section 8.01 Financial Statements. The Company shall deliver, and shall
cause UMC Canada to cause to be delivered to each of the Lenders:
(a) As soon as available and in any event within 60 days after the end
of each of the first three fiscal quarterly periods of each fiscal year of each
of OEI and UMC Canada, consolidated statements of income (including cost
summaries of general and administrative expenses in detail satisfactory to the
Administrative Agent), changes in stockholders' equity and cash flows of OEI and
its Consolidated Subsidiaries and UMC Canada and its Consolidated Subsidiaries
for such period and for the period from the beginning of the respective fiscal
year to the end of such period, and the related consolidated balance sheets as
at the end of such period, and commencing March 31, 1999, setting forth in each
case in comparative form the corresponding figures for the corresponding period
in the preceding fiscal year, accompanied by the certificates of the respective
senior financial officers of OEI and UMC Canada, which certificates shall
respectively state that said financial statements fairly present, in all
material respects, the respective consolidated financial conditions and results
of operations of OEI and UMC Canada and their respective Consolidated
Subsidiaries in accordance with generally accepted accounting principles,
consistently applied, as at the end of, and for, such period (subject to the
absence of footnotes and normal year-end audit adjustments).
(b) As soon as available and in any event within 120 days after the end
of each fiscal year of OEI and UMC Canada, consolidated statements of income,
changes in stockholders' equity and cash flows of OEI and its Consolidated
Subsidiaries and UMC Canada and its Consolidated Subsidiaries for such year and
the related consolidated balance sheets as at the end of such year, and
commencing December 31, 1999, setting forth in each case in comparative form the
corresponding figures for the preceding fiscal year, and accompanied by the
opinion thereon of independent certified public accountants of recognized
national standing, which opinion shall state that said financial statements
fairly present, in all material respects, the respective consolidated financial
condition and results of operations of OEI and UMC Canada and their respective
Consolidated Subsidiaries as at the end of, and for, such fiscal year.
(c) Promptly upon their becoming available, copies of all registration
statements and regular periodic reports, if any, which OEI or any of its
Subsidiaries shall have filed with the SEC or any national securities exchange.
(d) As soon as possible, and in any event within ten (10) days after
OEI knows that any of the events or conditions specified below with respect to
any Plan or Multiemployer Plan have occurred or exist, a statement signed by a
senior financial officer of OEI setting forth details respecting such event or
condition and the action, if any, which OEI or its ERISA Affiliate proposes to
take with respect thereto (and a copy of any report or notice required to be
filed with or given to PBGC by OEI or an ERISA Affiliate with respect to such
event or condition):
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(i) any reportable event, as defined in Section 4043(b) of ERISA and
the regulations issued thereunder, with respect to a Plan, as to which
PBGC has not 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 that a failure to meet the minimum funding standard of
Section 412 of the Code or Section 302 of ERISA shall be a reportable
event regardless of the issuance of any waivers in accordance with
Section 412(d) of the Code);
(ii) the filing under Section 4041 of ERISA of a notice of intent to
terminate any Plan or the termination of any Plan;
(iii) the institution by PBGC of proceedings under Section 4042 of
ERISA for the termination of, or the appointment of a trustee to
administer, any Plan, or the receipt by OEI or any ERISA Affiliate of a
notice from a Multiemployer Plan that such action has been taken by
PBGC with respect to such Multiemployer Plan;
(iv) the complete or partial withdrawal by OEI or any ERISA Affiliate
under Section 4201 or 4204 of ERISA from a Multiemployer Plan, or the
receipt by OEI or any ERISA Affiliate of notice from a Multiemployer
Plan that is in reorganization or insolvency pursuant to Section 4241
or 4245 of ERISA or that it intends to terminate or has terminated
under Section 4041A of ERISA; and
(v) the institution of a proceeding by a fiduciary of any Multiemployer
Plan against OEI or any ERISA Affiliate to enforce Section 515 of
ERISA, which proceeding is not dismissed within 30 days.
(e) As soon as available and in any event within 60 days after the end
of each fiscal quarterly period of each fiscal year of OEI, for such quarterly
period, the detailed monthly financial reports of OEI and its Consolidated
Subsidiaries, containing production, revenue and cost information reports for
such quarterly period with respect to the Oil and Gas Properties owned by the
Company and its Consolidated Subsidiaries, which report shall be in such form as
may be accepted by the Administrative Agent and the Technical Agents from time
to time.
(f) Promptly after OEI or the Company knows that a Default or Event of
Default has occurred and is continuing, a notice of such Default or Event of
Default describing the same in reasonable detail and what action, if any, either
OEI or the Company intends to take in response thereto.
(g) Prior to the issuance of any Pari Passu Debt under Section 9.01(h),
written notice of such event describing the amount of Debt to be incurred and
the maturity of such Pari Passu Debt, and such other information as the
Administrative Agent may reasonably request. In connection with the foregoing,
OEI shall also deliver a copy of the instruments and agreements evidencing or
governing such Pari Passu Debt, certified as true and complete by OEI.
(h) Promptly after OEI or any of its Restricted Subsidiaries is aware
of any event of force majeure or other event, circumstance or condition
materially and adversely affecting the Oil and Gas Properties of any Restricted
Subsidiary of OEI, notice of such event, circumstance or condition.
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(i) Promptly after OEI or any of its Restricted Subsidiaries is aware
that any Loan Document, after delivery thereof, has for any reason, except to
the extent permitted by the terms of this Agreement or thereof, ceased to be in
full force and effect and valid, binding and enforceable in accordance with its
terms (subject to customary exceptions therefrom), notice of such event or
condition.
(j) At the time OEI furnishes a Reserve Report under Section 8.05(a), a
report, in form and substance satisfactory to the Administrative Agent, setting
forth as of the day of such Reserve Report, a true and complete list of all Risk
Management Agreements (including commodity price swap agreements, forward
agreements or contracts of sale which provide for prepayment for deferred
shipment or delivery of oil, gas or other commodities) of OEI and each of its
Restricted Subsidiaries, the material terms thereof (including the type, term,
effective date, termination date and notional amounts or volumes), the net xxxx
to market value therefor, any new credit support agreements relating thereto not
listed on Schedule 7.21, any margin required or supplied under any credit
support document, and the counterparty to each such agreement.
(k) At the time OEI furnishes each set of financial statements pursuant
to Section 8.01(a) or (b), a report, in form and substance satisfactory to the
Administrative Agent, setting forth as of the last day of such fiscal quarter or
year, the amount of investments, loans and advances made to its Unrestricted
Subsidiaries pursuant to Section 9.03(p).
(l) From time to time such other information regarding the business,
affairs or financial condition of OEI and its Restricted Subsidiaries, including
the Company, as any Lender or the Administrative Agent may reasonably request.
OEI and the Company shall furnish to each Lender, at the time it furnishes each
set of financial statements pursuant to Section 8.01(a) or (b), a certificate of
a senior financial officer of OEI: (i) to the effect that no Default or Event of
Default has occurred and is continuing (or, if any Default or Event of Default
has occurred and is continuing, describing the same in reasonable detail and
what action, if any, OEI and/or the Company intends to take in response
thereto); and (ii) setting forth in reasonable detail the computations necessary
to determine whether OEI is in compliance with Sections 9.01(h), 9.03(c),
9.03(p), 9.04, 9.05, 9.12 and 9.16(b) as of the end of the respective fiscal
quarter or fiscal year.
Section 8.02 Litigation. The Company shall, and shall cause UMC Canada
to, promptly give to the Administrative Agent notice of all legal or arbitral
proceedings, and of all proceedings before any Governmental Authority, affecting
OEI or any of its Restricted Subsidiaries, including the Company, except
proceedings which could not reasonably be expected to have a Material Adverse
Effect.
Section 8.03 Corporate Existence, Etc.
(a) Except as permitted by Section 9.08, the Company and OEI shall, and
shall cause each of its Restricted Subsidiaries to: (i) preserve and maintain
its corporate existence and all of its material rights, privileges and
franchises; (ii) comply with the requirements of all applicable laws, rules,
regulations and orders of Governmental Authorities if failure to comply with
such requirements could reasonably be expected to have a Material Adverse
Effect; (iii) pay and discharge all taxes, assessments and governmental charges
or levies imposed on it or on its income or profits or on any of its Property
prior
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to the date on which penalties attach thereto, except for any such tax,
assessment, charge or levy the payment of which is being contested in good faith
and by proper proceedings and against which adequate reserves are being
maintained; (iv) permit representatives of any Lender or the Administrative
Agent, during normal business hours, to examine, copy and make extracts from its
books and records, inspect its Properties, and discuss its business and affairs
with its officers, all to the extent reasonably requested by such Lender or the
Administrative Agent (as the case may be); and (v) keep insured by financially
sound and reputable insurers all Property of a character usually insured by
corporations engaged in the same or similar business similarly situated against
loss or damage of the kinds and in the amounts customarily insured against by
such corporations and carry such other insurance as is usually carried by such
corporations.
(b) The Company and OEI shall, and shall cause each of its Restricted
Subsidiaries to (i) do or cause to be done all things reasonably necessary to
preserve and keep in good repair, working order and efficiency (ordinary wear
and tear excepted) all of the Oil and Gas Properties owned by the Company or any
Restricted Subsidiary of the Company including, without limitation, all
equipment, machinery and facilities, and (ii) make all the reasonably necessary
repairs, renewals and replacements so that at all times the state and condition
of the Oil and Gas Properties owned by OEI and its Restricted Subsidiaries,
including the Company, will be fully preserved and maintained, except to the
extent a portion of such Oil and Gas Properties is no longer capable of
producing Hydrocarbons in economically reasonable amounts, as determined by OEI
in its sole judgment.
(c) OEI and its Restricted Subsidiaries, including the Company, will
promptly pay and discharge or cause to be paid and discharged all delay rentals,
royalties, expenses and indebtedness accruing under, and perform or cause to be
performed each and every act, matter or thing required by, each and all of the
assignments, deeds, leases, sub-leases, contracts and agreements affecting their
interests in their Oil and Gas Properties and will do all other things necessary
to keep unimpaired OEI's or any Restricted Subsidiary's rights with respect
thereto and prevent any forfeiture thereof or a default thereunder, except (i)
to the extent a portion of such Oil and Gas Properties is no longer capable of
producing Hydrocarbons in economically reasonable amounts as determined by OEI
in its sole judgment, (ii) for sales or other dispositions of Oil and Gas
Properties permitted by Section 9.16, and (iii) if such failure to comply could
not reasonably be expected to have a Material Adverse Effect.
(d) OEI and its Restricted Subsidiaries, including the Company, will
operate their Oil and Gas Properties or cause or use commercially reasonably
efforts to cause such Oil and Gas Properties to be operated in a careful and
efficient manner in accordance with the practices of the industry and in
compliance with all applicable contracts and agreements and in compliance in all
material respects with all Governmental Requirements, except where the failure
to do so could not reasonably be expected to have a Material Adverse Effect.
(e) OEI will, and will cause its Subsidiaries, including the Company,
to, maintain accounting procedures, books and records to permit the preparation
of financial statements of OEI and its Subsidiaries in accordance with GAAP.
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(f) OEI or any of its Restricted Subsidiaries, including the Company,
may upon thirty (30) days' prior notice to the Administrative Agent change its
principal place of business and chief executive offices from that listed on
Exhibit D.
Section 8.04 Environmental Matters. OEI shall, and shall cause each of
its Subsidiaries, including the Company, to promptly notify the Administrative
Agent and the Lenders in writing of any existing, pending or threatened action,
investigation or inquiry by any Governmental Authority (of which OEI or any of
its Subsidiaries has actual knowledge) in connection with any Environmental
Laws, excluding routine testing and corrective action, which would involve a
violation of any Environmental Law or remedial obligation (individually or in
the aggregate) sufficient to have a Material Adverse Effect.
Section 8.05 Engineering Reports.
(a) On or before March 15 of each year commencing March 15, 1999, the
Company shall furnish to the Technical Agents and the Lenders a Reserve Report
as of the preceding January 1st in form and substance reasonably satisfactory to
the Technical Agents. The January 1 Reserve Report of each year shall be
comprised of two reports; one being prepared by or under the supervision of
certified independent petroleum engineers or other independent petroleum
consultant(s) reasonably acceptable to the Technical Agents and evaluating Oil
and Gas Properties comprising not less than eighty percent (80%) of the SEC
Value of the Oil and Gas Properties of OEI and its Restricted Subsidiaries which
Properties OEI desires to have included in the Borrowing Base, and the other
being prepared by or under the supervision of the chief petroleum engineer of
OEI (utilizing substantially similar procedures to those used by its independent
petroleum engineers) and evaluating the Oil and Gas Properties comprising the
remaining SEC Value of the Oil and Gas Properties of OEI and its Restricted
Subsidiaries which Properties OEI desires to have included in the Borrowing
Base. Notwithstanding the foregoing, the January 1 Reserve Report relating to
any Oil and Gas Properties not located in the geographical boundaries of the
United States of America and Canada and surrounding waters shall be prepared by
certified independent petroleum engineers or other independent petroleum
consultant(s) reasonably acceptable to the Technical Agents.
(b) On or before September 15 of each year commencing September 15,
1998, the Company shall furnish to the Technical Agents and the Lenders a
Reserve Report prepared as of the immediately preceding July 1 by the chief
engineer of the Company (who shall certify such report to have been prepared in
accordance with the procedures used in the immediately preceding January 1
Reserve Report), which shall further evaluate the Oil and Gas Properties
evaluated in the immediately preceding Reserve Report. For any unscheduled
redetermination pursuant to Section 2.09(d), the Company shall provide such
Reserve Report (which shall be prepared by its chief engineer) with an "as of"
date as specified by the Required Lenders, as soon as possible, but in any event
no later than 75 days following the receipt of the request by the Administrative
Agent.
(c) With the delivery of each Reserve Report required in Section
8.05(a) and (b), the Company shall provide to the Lenders a statement reflecting
(i) any material changes in the net revenue interest of each well or lease as
reflected in the Reserve Report delivered for the prior period, after giving
effect to all encumbrances listed therein from the net revenue interests as
reflected in such report, along with an explanation as to any material
discrepancies between the two net revenue interest disclosures, and (ii) except
as set forth on an exhibit thereto, on a net basis there are no gas imbalances,
take or pay or
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other prepayments with respect to their Oil and Gas Properties evaluated in such
Reserve Report which would require the Company or any of its Restricted
Subsidiaries to deliver Hydrocarbons produced from such Oil and Gas Properties
at some future time without then or thereafter receiving full payment therefor.
(d) If the Technical Agents desire to exclude an Oil and Gas Property
included in the Borrowing Base on the basis that title to such Oil and Gas
Property is unsatisfactory, the Administrative Agent shall give OEI written
notice thereof and OEI shall have 90 days to cure such defect. If OEI is unable
to cure any such title defect requested to be cured within the 90-day period,
such default shall not be a Default or an Event of Default, but instead, if the
aggregate value of all such Oil and Gas Properties which have unsatisfactory
title defects (and which have not previously resulted in the invocation of the
remedy set forth in this Section) constitutes 5% or more of the then current
amount of the Borrowing Base, the Technical Agents shall have the right, by
sending written notice to OEI, to reduce the then outstanding Borrowing Base by
an amount as reasonably determined by the Technical Agents to reflect the
impairment to the Borrowing Base caused by such title defect. This adjustment to
the Borrowing Base shall become effective immediately after receipt of such
notice.
Section 8.06 Stock of Restricted Subsidiaries. Except as provided in
Section 9.08 and Exhibit D, OEI will at all times own all issued and outstanding
shares of all classes of stock of its Restricted Subsidiaries as listed on
Exhibit D and the Company will at all times own all issued and outstanding
shares of all classes of stock of its Restricted Subsidiaries listed on Exhibit
D.
Section 8.07 Further Assurances. OEI shall, and shall cause its
Restricted Subsidiaries to, cure promptly any defects in the creation and
issuance of the Notes and the execution and delivery of the Loan Documents,
including this Agreement. OEI and its Restricted Subsidiaries, including the
Company, will at their expense promptly execute and deliver to the
Administrative Agent upon request all such other and further documents,
agreements and instruments (a) in compliance with or accomplishment of the
covenants and agreements of OEI and the Company in the Loan Documents, including
this Agreement, (b) to further evidence and more fully describe the collateral,
if any, intended as security for the Notes, (c) to correct any omissions in the
Loan Documents, or more fully state the security obligations set out herein or
in any of the Loan Documents, (d) to perfect, protect or preserve any Liens
created pursuant to any of the Loan Documents, or (e) to make any recordings, to
file any notices, or obtain any consents, all as may be necessary or appropriate
in connection therewith.
Section 8.08 Performance of Obligations. The Company will pay the Notes
according to the reading, tenor and effect thereof; and OEI and the Company will
and will cause each Subsidiary to do and perform every act and discharge all of
the obligations to be performed and discharged by them under this Agreement and
the other Loan Documents, at the time or times and in the manner specified.
ARTICLE IX
Negative Covenants
OEI and the Company agree that, so long as any of the Commitments are
in effect and until payment in full of all Loans hereunder, all interest thereon
and all other amounts payable by OEI or the Company hereunder or any Loan
Document:
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Section 9.01 Debt. OEI will not and will not permit any of its
Subsidiaries, including the Company, to incur, create, assume or suffer to exist
any Debt, except the following (each of which exceptions is in addition to, and
not in limitation of, the other; and OEI may elect to classify any item of Debt
under any applicable exception, and such classification shall not be deemed to
be a utilization of any other potentially applicable exception):
(a) the Indebtedness and the Canadian Indebtedness and any guarantees
thereof;
(b) Debt of OEI and its Subsidiaries, including the Company, existing
on the date of this Agreement which is reflected in the Financial Statements or
is disclosed in Schedule 9.01, and any renewals, refinancings and extensions
thereof;
(c) Debt created under leases which, in accordance with GAAP are or
should be recorded as capital leases, in an aggregate amount not to exceed
$10,000,000 at any one time outstanding; provided that UMC Canada may not incur,
create, assume or suffer to exist any Debt under this Section 9.01(c) in an
aggregate amount in excess of $2,000,000 at any one time outstanding;
(d) Debt (i) of any Unrestricted Subsidiary that is Non-Recourse Debt,
on terms approved by the Administrative Agent, the Syndication Agent and the
Documentation Agent (which approval shall not be unreasonably withheld),
provided that the Property of such Unrestricted Subsidiary is not included in
the most recent calculation of the Borrowing Base, or (ii) of Persons who are
not Subsidiaries of OEI which is Non-recourse to OEI and its Restricted
Subsidiaries and any of their Property except for recourse constituting Debt
permitted under Section 9.01(m);
(e) (i) Subordinated Debt incurred pursuant to the Indentures and any
refinancings permitted by Section 9.19(a) of this Agreement or a consent
thereunder; provided that in no event may the aggregate principal amount of all
Subordinated Debt under the Indentures exceed $510,000,000 at any one time
outstanding without the consent of the Required Lenders, (ii) obligations under
or in connection with the Pledge of Production and Trust Agreements, and (iii)
other Subordinated Debt that is issued on terms reasonably satisfactory to each
of the Administrative Agent, the Syndication Agent and the Documentation Agent
with respect to maturity, interest rate, covenants and subordination language
and any refinancings thereof permitted by Section 9.19(a) of this Agreement or a
consent thereunder, provided that in connection with the issuance of any such
Subordinated Debt under this clause (iii), the Borrowing Base and the Threshold
Amount are redetermined;
(f) Debt of OEI or any of its Restricted Subsidiaries, including the
Company, created, incurred or assumed after the date hereof; provided that the
aggregate outstanding principal amount of such Debt shall not exceed $10,000,000
at any one time outstanding;
(g) Debt owed by OEI or any of its Restricted Subsidiaries to OEI or
any of its Restricted Subsidiaries; provided such Debt is on terms (including,
without limitation, subordination provisions) reasonably satisfactory to the
Administrative Agent (which approval shall not be unreasonably withheld);
(h) (i) Short-Term Pari Passu Debt, provided that prior to the issuance
or incurrence of such Debt, the Company provides the Administrative Agent notice
thereof as required by Section 8.01(g); and
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(ii) Long-Term Pari Passu Debt that is issued on terms reasonably satisfactory
to each of the Administrative Agent, the Syndication Agent and the Documentation
Agent with respect to maturity, interest rate and covenants and any refinancings
thereof permitted by Section 9.19(a) of this Agreement or a consent thereunder,
provided that in connection with the issuance of any such Debt under this clause
(ii), the Borrowing Base and the Threshold Amount are redetermined;
(i) Debt, on terms approved by the Administrative Agent, the
Syndication Agent and the Documentation Agent (which approval shall not be
unreasonably withheld), incurred by partnerships, of which the Company or any
Subsidiary is a general partner and which Debt is Non-recourse to the Company or
such Subsidiary for the payment thereof (including no recourse to the Company's
or such Subsidiary's interest in such partnership);
(j) Debt under the Havre Credit Facility;
(k) Debt not to exceed $10,000,000 in the aggregate at any one time
outstanding under guarantees or other similar surety obligations with respect to
Debt owed by the Government of Equatorial Guinea or any Person exercising rights
of a sovereign on its behalf;
(l) Debt of Lion not to exceed $12,000,000 in the aggregate at any one
time outstanding incurred with respect to the Abidjan LPG plant and all
guarantees or other surety obligations with respect to such Debt;
(m) With respect to Debt described in Section 9.01(d) (the "Primary
Obligation"), (i) Debt not to exceed $10,000,000 in the aggregate at any one
time outstanding under guarantees of (or other surety obligations with respect
to) such Primary Obligation, and (ii) Debt arising out of the grant of Liens on
stock (or other equity interests) issued by the obligor on such Primary
Obligation;
(n) Debt associated with letters of credit, bank guarantees, bonds or
surety obligations required by Governmental Requirements in connection with the
usual and customary operation of the Oil and Gas Properties;
(o) Debt in an aggregate amount at any one time outstanding not to
exceed $250,000,000 of a Restricted Subsidiary engaged in the oil and gas
business exclusively outside of North America (i) that is Non-recourse to OEI
and any other Restricted Subsidiary of OEI and their respective Property (other
than those guarantees or other surety obligations relating to such Debt to which
the Technical Agents and the Required Lenders consent in writing), and (ii) that
is on terms approved by the Technical Agents and the Required Lenders, provided
that in connection with the issuance of any such Debt under this Section
9.01(o), (A) the Borrowing Base and the Threshold Amount are redetermined, and
(B) no further investments, loans and advances under Section 9.03 shall be made
in or to such obligor without the prior consent of the Required Lenders; and
(p) Endorsements of checks and other instruments in the ordinary course
of business for purposes of collection.
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Section 9.02 Liens. OEI will not and will not permit any of its
Subsidiaries, including the Company to create, incur, assume or permit to exist
any Lien on any of its Properties (now owned or hereafter acquired), except:
(a) Liens securing the payment of any Indebtedness or the Canadian
Indebtedness and any guarantees thereof;
(b) Excepted Liens;
(c) Liens existing on the date of this Agreement which have been
disclosed to the Lenders in the Financial Statements or in Schedule 9.02, and
any renewals and extensions thereof;
(d) Liens securing Debt permitted by Section 9.01(c), provided that
such Liens attach only to the Property subject to such lease;
(e) Liens securing Debt permitted by Section 9.01(d) and Section
9.01(e)(ii);
(f) Liens securing Debt permitted by Section 9.01(i), provided that
such Liens attach only to Property of the partnership incurring such Debt;
(g) Liens to secure the Debt permitted by Section 9.01(j) on any
Property owned by Havre and on the Company's ownership interest in Havre, and
encumbrances under gas gathering agreements caused by the dedication by the
Company to Havre of the Company's Oil and Gas Properties located adjacent to the
gas gathering system owned by Havre; and
(h) Liens securing Debt permitted by Sections 9.01(k), (l), (m), (n)
and (o).
Section 9.03 Investments, Loans and Advances. OEI will not and will not
permit any of its Restricted Subsidiaries, including the Company, to make or
permit to remain outstanding any loans or advances to or investments in any
Person, except that the foregoing restriction shall not apply to:
(a) investments, loans or advances reflected in the Financial
Statements or which are disclosed to the Lenders in Schedule 9.03;
(b) investments, loans or advances by OEI or by any of its Restricted
Subsidiaries to or in OEI or any of its Restricted Subsidiaries, including,
without limitation, purchases of outstanding equity interests in Restricted
Subsidiaries held by Persons that are not Restricted Subsidiaries;
(c) (i) investments by OEI or any of its Restricted Subsidiaries in
additional Oil and Gas Properties and facilities related thereto, including gas
gathering systems, and other investments, loans and advances made in the
ordinary course of, and which are or become customary in, the oil and gas
business as a means of actively exploiting, exploring for, acquiring,
developing, processing, gathering, storing, marketing or transporting oil and
gas; (ii) investments, loans or advances in or to any Restricted Subsidiary of
OEI for the investment by such Persons in Properties of the types described in
clause (c)(i) above (whether now owned or hereafter acquired or developed)
located in jurisdictions (A) in North America and
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(B) outside of North America; provided that such investments, loans or advances
under this clause (c)(ii)(B) shall not exceed $150,000,000 annually, net of cash
received during such period as a return of capital or return on investment from
any such investment, loan or advance previously made, in the aggregate for each
nation; and (iii) investments in unrelated development activities or businesses
in countries in which any of its Restricted Subsidiaries has Oil and Gas
Properties; provided that the aggregate amount of such investments under this
clause (iii) do not exceed $10,000,000, net of cash received during such period
as a return of capital or return on investment from any such investment, loan or
advance previously made, in the aggregate during any twelve month period;
(d) routine advances by OEI or any of its Restricted Subsidiaries to or
on behalf of OEI or any of its Restricted Subsidiaries in the ordinary course of
business for general and administrative expenses;
(e) routine operating expenses advanced by OEI or any of its Restricted
Subsidiaries as operator in the ordinary course of business for other working
interest owners under operating agreements, which do not exceed $10,000,000 in
the aggregate outstanding at any one time to all Persons combined;
(f) investments required to satisfy obligations under any Plans;
(g) accounts receivable of OEI or any of its Restricted Subsidiaries,
including the Company, arising out of the sale of Hydrocarbons and other assets
or services in the ordinary course of business;
(h) direct obligations of the United States or any agency thereof, or
obligations guaranteed by the United States or any agency thereof, in each case
maturing within one year from the date of purchase thereof; and repurchase
agreements of any commercial banks in the United States, if the commercial paper
of such bank or of the bank holding company of which such bank is a wholly owned
subsidiary is rated in one of the two highest rating categories of Standard &
Poors Ratings Service, Xxxxx'x Investors Service, Inc. or any other rating
agency satisfactory to the Majority Lenders, that are fully secured by
securities described in this Section 9.03(h);
(i) commercial paper rated in one of the two highest grades by Standard
& Poors Rating Service or Xxxxx'x Investors Service, Inc.;
(j) demand deposits and certificates of deposit maturing within one
year from the date of acquisition thereof with any Lender or any office located
in the United States of any bank or trust company which is organized under the
laws of the United States or any state thereof and which has capital, surplus
and undivided profits aggregating at least $500,000,000 (as of the date of such
bank or trust company's most recent financial reports);
(k) routine advances or loans to employees of OEI or any of its
Subsidiaries, including the Company, not to exceed $200,000 in the aggregate at
any one time;
(l) deposit accounts maintained in the ordinary course of business by
OEI or any of its Subsidiaries maturing within one year from the date of
creation thereof with any bank or trust company organized in a country in which
a Restricted Subsidiary is then doing business or in which it owns Property;
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(m) investments, loans or advances in an aggregate amount not to exceed
$10,000,000, net of cash received during such period as a return of capital or
return on investment from any such investment, loan or advance previously made,
to or for the benefit of the Government of Equatorial Guinea or any Governmental
Authority thereof;
(n) (i) investments, loans or advances (including any guarantee or
other surety obligation constituting Debt under Section 9.01(m)(i) and the
amount of any Letters of Credit issued on account of Lion, but excluding
obligations under Section 9.01(m)(ii)) in the Abidjan LPG plant or in Lion or in
any Person that directly or indirectly controls such plant in an aggregate
amount not to exceed $25,000,000, net of cash received during such period as a
return of capital or return on investment, loan or advance from any such
investment, loan or advance previously made, and (ii) investments, loans or
advances in Havre (including any guarantee or other surety obligation
constituting Debt under Section 9.01(j) or (m)(i) and the amount of any Letters
of Credit issued on account of Havre, but excluding obligations under Section
9.01(m)(ii)) in an aggregate amount not to exceed $21,000,000, net of cash
received during such period as a return of capital or return on investment, loan
or advance from any such investment, loan or advance previously made;
(o) investments by OEI or any of its Restricted Subsidiaries under Risk
Management Agreements entered into in the ordinary course of their business for
the purposes of protecting against fluctuations in interest rates, oil and gas
prices or foreign currency exchange rates;
(p) investments, loans and advances in or to Unrestricted Subsidiaries
of OEI other than Havre and Lion; provided that the aggregate amount of
investments, loans and advances (including (i) guarantee or other surety
obligations by OEI or any Restricted Subsidiary constituting Debt under Section
9.01(m)(i), but excluding obligations under Section 9.01(m)(ii), (ii) Letters of
Credit issued on account of obligations of such Unrestricted Subsidiary and
(iii) if UMC Equatorial Guinea Corporation, a Delaware corporation, or its
successor, is designated as an Unrestricted Subsidiary, the aggregate amount of
investments, loans or advances made under Section 9.03(m)) in and to all
Unrestricted Subsidiaries (other than Havre and Lion) by OEI and its Restricted
Subsidiaries hereunder, net of cash received as a return of capital or return on
any investment, loan or advance previously made, does not exceed $20,000,000;
(q) deposits in money market funds investing exclusively in investments
described in Section 9.03(h), 9.03(i) or 9.03(j);
(r) other investments, loans or advances not to exceed $1,000,000 in
the aggregate at any time; and
(s) advances to operators under operating agreements entered into by
OEI or any of its Restricted Subsidiaries in the ordinary course of business.
Section 9.04 Dividends, Distributions and Redemptions. Except with
prior approval of the Required Lenders, OEI will not declare or pay any
dividend, purchase, redeem or otherwise acquire for value any of its stock now
or hereafter outstanding, return any capital to its stockholders, or make any
distribution of its assets to its stockholders as such, or permit any of its
Restricted Subsidiaries to purchase or otherwise acquire for value any stock of
OEI, except OEI may, so long as no Default or Event of
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Default has occurred and is continuing: (i) declare and deliver stock dividends;
(ii) redeem or repurchase stock with the proceeds received from the issuance of
new shares of any class of stock within the 12 month period prior to such
redemption or repurchase; provided that the aggregate amount redeemed or
repurchased under this clause (ii) during such 12 month period does not exceed
$100,000,000; and (iii) (A) declare and pay cash dividends, and (B) if, but only
if, the 12 month redemption/repurchase period allowed in Section 9.04(ii) is not
applicable, redeem or repurchase stock, in either case in an aggregate amount
not to exceed $25,000,000 plus 50% of the Consolidated Net Income generated
after March 31, 1998; provided that no Borrowing Base Deficiency exists either
immediately before declaration of such dividend and after payment of such
dividend or immediately after any such stock redemption or repurchase.
Section 9.05 Financial Covenants.
(a) Interest Coverage Ratio. OEI will not permit its Interest Coverage
Ratio, as of the end of any fiscal quarter of OEI, to be less than 3.0 to 1.0.
(b) Debt Coverage Ratio. OEI will not permit its Debt Coverage Ratio,
at any time to be greater than 3.5 to 1.0.
(c) Tangible Net Worth. On and after the Initial Funding, OEI will not
permit its Consolidated Tangible Net Worth to be less than $580,000,000 plus the
amount equal to seventy-five percent (75%) of the net cash proceeds of any sale
or other issuance of any equity security by OEI at any time after the Effective
Date, plus the amount equal to 50% of its positive Consolidated Net Income for
the period from March 31, 1998 to the date of such determination, taken as a
single accounting period.
Section 9.06 Nature of Business. OEI will not, and will not permit any
of its Restricted Subsidiaries to, make any material change in the character of
its business as carried on at the date hereof.
Section 9.07 Limitation on Operating Leases and Sale-Leaseback
Transactions. OEI will not, and will not permit any of its Restricted
Subsidiaries, including the Company to, create, incur, assume or suffer to exist
any obligation for the payment of rent or hire of Property of any kind
whatsoever (real or personal), under leases or lease agreements (other than (a)
leases or lease agreements which constitute Debt, (b) leases of Hydrocarbon
Interests, and (c) leases directly related to oil and gas field operations,
including without limitation, leases for drilling, workover or other rig related
activities) which would cause (i) the aggregate amount of all payments made by
OEI and its Restricted Subsidiaries, other than UMC Canada and its Restricted
Subsidiaries (in each case, determined on a consolidated basis), pursuant to
such leases or lease agreements to exceed $15,000,000 in any period of twelve
consecutive calendar months or (ii) the aggregate amount of all payments made by
UMC Canada and its Restricted Subsidiaries (determined on a consolidated basis)
pursuant to such leases or lease agreements to exceed $2,000,000 in any period
of twelve consecutive calendar months. Neither OEI nor any of its Restricted
Subsidiaries will enter into any arrangement, directly or indirectly, with any
Person whereby OEI or any of its Restricted Subsidiaries shall sell or transfer
any of their Property, whether now owned or hereafter acquired, and whereby OEI
or any of its Restricted Subsidiaries shall then or thereafter rent or lease as
lessee such Property or any part thereof or other Property which OEI or any of
its Restricted Subsidiaries intends to use for substantially the same purpose or
purposes as the Property sold or transferred.
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Section 9.08 Mergers, Etc. OEI will not, and will not permit any of its
Restricted Subsidiaries, including the Company and UMC Canada, to (a) merge into
or with or consolidate with, any other Person, (b) sell, lease or otherwise
dispose of (whether in one transaction or in a series of transactions), all or
any substantial part of its Property or assets to any other Person, or (c)
dissolve or take other similar actions; provided that if OEI or the Company
gives prior written notice to the Administrative Agent, and no Default or Event
of Default has occurred and is continuing or will result from the action
proposed to be taken, then: any Restricted Subsidiary of OEI (other than UMC
Canada) may (i) merge or consolidate with OEI or with any other Subsidiary of
OEI, including an Unrestricted Subsidiary so long as the requirements of
Sections 9.16 and 9.21 are met, (ii) sell, lease or otherwise dispose of (at
fair market value) all or any substantial part of its Property or assets to OEI
or to any other Subsidiary of OEI, including an Unrestricted Subsidiary so long
as the requirements of Sections 9.16 and 9.21 are met, or (iii) dissolve or take
other similar actions.
Section 9.09 Proceeds of Notes. The Company will not permit the
proceeds of the Notes to be used for any purpose other than those permitted by
Section 7.07.
Section 9.10 ERISA Compliance. OEI will not at any time permit any Plan
maintained by it or any of its Subsidiaries to:
(a) engage in any "prohibited transaction" as such term is defined in
Section 4975 of the Code;
(b) except as provided in Schedule 9.10, incur any "accumulated funding
deficiency" as such term is defined in Section 302 of ERISA; or
(c) terminate any such Plan in a manner which could result in the
imposition of a Lien on the Property of OEI or any of its Subsidiaries,
including the Company, pursuant to Section 4068 of ERISA.
Section 9.11 Sale or Discount of Receivables. Except for receivables
obtained by the Company out of the ordinary course of its business, OEI and its
Restricted Subsidiaries, including the Company, will not discount or sell (with
or without recourse) any of its notes receivable or accounts receivable except
for settlement of joint interest billing accounts (other than with respect to
Restricted Subsidiaries) in the normal course of business.
Section 9.12 Risk Management Agreements. OEI will not, and will not
permit any of its Restricted Subsidiaries to, incur any obligations under Risk
Management Agreements, except for obligations either with investment grade
counterparties or as disclosed in Schedule 7.21; provided Risk Management
Agreement relating to commodity prices shall not cover more than (i) 80% of
OEI's and its Restricted Subsidiaries' applicable production estimates from
their Oil and Gas Properties for the 24 month period measured as of the end of
each fiscal quarter of OEI and its Consolidated Subsidiaries, (ii) 65% of OEI's
and its Restricted Subsidiaries' applicable production estimates from their Oil
and Gas Properties for the period commencing at the end of such 24-month period
and ending on the date which is 36 months after the date of determination, and
(iii) 50% of OEI's and its Restricted Subsidiaries' applicable production
estimates from their Oil and Gas Properties for the period thereafter.
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Section 9.13 Transactions with Affiliates. OEI and its Restricted
Subsidiaries, including the Company, shall not enter into any transaction,
including without limitation, any purchase, sale, lease or exchange of property
or the rendering of any service, with any Affiliate (other than OEI, the
Company, UMC Canada or any other Restricted Subsidiary of OEI) unless such
transactions are in the ordinary course of OEI's or its Restricted Subsidiary's
business and are upon fair and reasonable terms no less favorable to OEI or such
Restricted Subsidiary than could be obtained in a comparable arm's length
transaction with a Person not an Affiliate.
Section 9.14 Negative Pledge Agreements. Except for (a) any of the Loan
Documents; (b) the Indentures or any other agreement evidencing the Subordinated
Debt; (c) agreements permitted by Sections 9.02(c), (d), (e), (f), (g) or (h)
but only with respect to the Property subject of the Lien permitted thereby; (d)
customary provisions in leases, licenses, asset sale agreements and other
customary agreements not related to the borrowing of money and entered into in
the ordinary course of business, (e) Liens or restrictions imposed on
investments (or Property related thereto) of the type described in Section
9.03(c)(iii), but only on such investments or Property; and (f) restrictions
imposed by agreements governing Excepted Liens, OEI and its Restricted
Subsidiaries, including the Company, will not create, incur, assume or suffer to
exist any contract, agreement or understanding which in any way prohibits or
restricts the granting, conveying, creation or imposition of any Lien on any
Property of OEI or any of its Restricted Subsidiaries, including the Company, or
which requires the consent of or notice to other Persons in connection
therewith.
Section 9.15 Subsidiaries and Partnerships. OEI and any of its
Restricted Subsidiaries may create additional Subsidiaries or partnerships,
provided that the Company shall give the Administrative Agent prompt notice
thereof.
Section 9.16 Sale of Oil and Gas Properties. Except for Hydrocarbons
sold in the ordinary course of business as and when produced or after the
production thereof, the Company will not sell, assign, transfer or convey, or
permit any of its Restricted Subsidiaries to sell, assign, transfer or convey,
any interest in any of the Oil and Gas Properties that constitute part of the
Borrowing Base. This provision shall not apply to:
(a) Routine farm-outs and other dispositions of non-proven acreage;
(b) Sales or other dispositions of Properties, provided that if the
aggregate fair market value of such Properties (other than Properties listed on
Schedule 9.16) sold or otherwise disposed of during any Redetermination Period
exceeds five percent (5%) of the then current SEC Value of the Oil and Gas
Properties included in the Borrowing Base (as in effect immediately prior to
such sale), then simultaneously with any such disposition the Borrowing Base is
reduced by an amount reasonably determined at the time by the Technical Agents
to reflect the contribution to the Borrowing Base of the Properties so disposed
of; and
(c) Sale of the Properties listed on Schedule 9.16.
Section 9.17 Environmental Matters. OEI will not cause or permit, or
permit any of its Subsidiaries, including the Company, to cause or permit, any
of its Property to be in violation of, or do
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anything or permit anything to be done which will subject any such Property to
any remedial obligations under any Environmental Laws if the effect of such
violation could reasonably be expected to have a Material Adverse Effect. OEI
and its Subsidiaries, including the Company, will establish and implement such
procedures as may be necessary to promptly and properly respond in the event
that: (i) solid wastes are disposed of on any of its respective Property in
quantities or locations that would require remedial action under any
Environmental Laws; (ii) hazardous substances are released on or to any such
Property in a quantity equal to or exceeding that quantity which requires
reporting pursuant to Section 103 of CERCLA; (iii) hazardous substances are
released on or to any such Property so as to pose an imminent and substantial
endangerment to public health or welfare or the environment; or (iv) oil is
released or threatened to be released in violation of OPA.
Section 9.18 Payment Restrictions. Except for (a) any of the Loan
Documents, (b) the Indentures or other agreements evidencing any of the
Subordinated Debt, (c) the agreements relating to Non-recourse Debt permitted by
Section 9.01, but only with respect to the Restricted Subsidiary that is liable
for such Non-recourse Debt, and (d) restrictions imposed relating to investments
(or Property related thereto) of the type described in Section 9.03(c)(iii), but
only with respect to such investments or Property, OEI and its Restricted
Subsidiaries, including the Company, will not enter into any agreements which
would restrict payments from the Restricted Subsidiaries of the Company to the
Company or Restricted Subsidiaries of OEI to OEI.
Section 9.19 Subordinated and Long-Term Pari Passu Debt. Neither OEI
nor any of its Restricted Subsidiaries shall, without the prior written consent
of the Majority Lenders:
(a) defease, redeem, offer to purchase or purchase any of the
Subordinated Debt or the Long-Term Pari Passu Debt, unless the Indebtedness
shall have been paid in full and the Commitments of each Lender and Canadian
Lender terminated; provided that OEI may optionally defease, redeem, offer to
purchase and purchase all or any part of the Subordinated Debt and the Long-Term
Pari Passu Debt (i) with the proceeds of the issuance of any equity securities
or (ii) with the proceeds of any other Debt (which, in the case of Subordinated
Debt, is subordinated on terms substantially identical to the Subordinated Debt
or on terms more advantageous to the Lenders and the Canadian Lenders and) which
has an average life and final maturity later than the average life and final
maturity date, respectively, of the Subordinated Debt or Long-Term Pari Passu
Debt being refinanced; provided further that OEI and the Company may (1) make
the payments required under the Pledge of Production Trust Agreements in
accordance with the terms thereof, (2) make the change in control offer required
under the 95 Indenture, and (3) make mandatory prepayments of the Long-Term Pari
Passu Debt to the extent required under the instruments governing such Debt; or
(b) amend, supplement or modify the provisions of the Indentures or any
instrument evidencing or guaranteeing the Subordinated Debt or the Long-Term
Pari Passu Debt; provided that the foregoing shall not apply to the following:
(i) any amendment, supplement or modification, that, subject to the concurrence
of the Administrative Agent, the Syndication Agent and the Documentation Agent,
causes such Subordinated Debt or Long-Term Pari Passu Debt to have terms
generally less restrictive than its terms immediately prior thereto, (ii) any
amendment or supplement to the 96 Indenture or the 97 Indenture to conform the
provisions thereof to the corresponding provisions of the 95 Indenture; and
(iii) OEI and the Company (and the trustee, if applicable) may enter into
supplemental indentures to the instruments
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governing such Subordinated Debt or Long-Term Pari Passu Debt of the type
described in Section 9.1 of each of the Indentures.
Section 9.20 Maintenance of Deposits. OEI and the Company shall not,
and shall not permit any of their Restricted Subsidiaries to, maintain deposits
of funds in any bank or financial institution outside of the United States,
Canada and nations that are members of the European Union, except for operating
accounts in jurisdictions where OEI or any of its Restricted Subsidiaries is
doing business or owns Property, which operating accounts shall contain only
such minimum amounts as may be necessary for the conduct of business or the
maintenance and exploitation of such Property.
Section 9.21 Unrestricted Subsidiaries.
(a) OEI will not, and will not permit any Restricted Subsidiary to,
create or otherwise designate any Subsidiary as an Unrestricted Subsidiary if
(i) a Borrowing Base Deficiency exists, (ii) a Default or Event of Default
exists or would result from such creation or designation, including under
Section 9.03(p), (iii) such Subsidiary owes or incurs Debt other than
Non-Recourse Debt, Debt under Section 9.01(j), and Debt owed to OEI and any of
its Restricted Subsidiaries in connection with investments, loans or advances
(including, without limitation, contingent obligations) made in compliance with
Section 9.03(n) or (p), or (iv) such creation or designation shall result in the
creation or imposition of any claim or Lien on any assets of OEI or any
Restricted Subsidiary. Notwithstanding the foregoing, in no event may the Board
of Directors of OEI designate the Company, Norfolk or UMC Canada as an
Unrestricted Subsidiary.
(b) Without limitation of Section 9.21(a), OEI will not, and will not
permit any Restricted Subsidiaries to, without the prior written consent of the
Majority Lenders, change the characterization of a Subsidiary from a Restricted
Subsidiary to an Unrestricted Subsidiary or an Unrestricted Subsidiary to a
Restricted Subsidiary; provided, however, the prior written consent of the
Majority Lenders shall not be required to (i) change the characterization of an
Unrestricted Subsidiary to a Restricted Subsidiary if (A) no Default or Event of
Default shall have occurred and be continuing at such time or would result
therefrom, (B) after giving effect to such re-characterization, each of the
representations and warranties made by OEI and the Company in the Loan Documents
to which each is a party shall be true and correct in all material respects, and
(C) OEI provides the Administrative Agent five (5) days advance written notice
of its intent to re-characterize such Subsidiary or (ii) change the
characterization of a Restricted Subsidiary to an Unrestricted Subsidiary if (A)
no Default or Event of Default shall have occurred and be continuing or would
result therefrom (including a violation of Section 9.03(p)), and on the date of
such recharacterization, all investments made by OEI or any other Restricted
Subsidiary in such Restricted Subsidiary prior to the date of such
re-characterization shall be investments in an Unrestricted Subsidiary subject
to Section 9.03(p), (B) if the Restricted Subsidiary owns any Oil and Gas
Properties which are included in the Borrowing Base, the Borrowing Base shall be
reduced by an amount reasonably determined at the time by the Technical Agents
to reflect the contribution to the Borrowing Base of the Properties so owned,
and (C) OEI provides the Administrative Agent five (5) days advance written
notice of its intent to re-characterize such Subsidiary.
Section 9.22 Gas Imbalances, Take-or-Pay or Other Prepayments. OEI and
its Restricted Subsidiaries will not enter into any contracts or agreements
which warrant production of Hydrocarbons
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and will not hereafter allow gas imbalances, take-or-pay or other prepayments
with respect to the Oil and Gas Properties of OEI and its Restricted
Subsidiaries which would require OEI or such Restricted Subsidiaries to deliver
Hydrocarbons produced on Oil and Gas Properties at some future time without then
or thereafter receiving full payment therefor to exceed 10,000,000 mcf of gas in
the aggregate on a net basis.
ARTICLE X
Events of Default
Section 10.01 Events of Default. If one or more of the following events
(herein called "Events of Default") shall occur and be continuing:
(a) The Company shall default in the payment or mandatory prepayment
when due of any principal of any Loan or of any reimbursement obligation for
disbursement made under any Letter of Credit; or the Company shall default in
the payment when due of any interest on any Loan, any fees payable hereunder or
under any other Loan Document or other amount payable by it hereunder or
thereunder and such default shall continue for a period of five (5) Business
Days; or
(b) OEI or any of its Restricted Subsidiaries, including the Company,
shall default in the payment when due (after expiration of all applicable grace
periods, if any) of any principal of or interest on any of its other Debt, or
default in the payment of any termination or settlement payments under any
futures contracts, or similar Risk Management Agreement, in any case, in an
amount in excess of $15,000,000; or any event specified in any note, agreement,
indenture or other document evidencing or relating to any Debt of OEI or any of
its Restricted Subsidiaries in an amount in excess of $15,000,000 shall occur
(including the giving of all required notices and the expiration of all
applicable grace periods, if any) and be continuing if the effect of such event
is to cause, or to permit the holder or holders of such Debt (or a trustee or
agent on behalf of such holder or holders) to cause, such Debt in excess of
$15,000,000 to become due prior to its stated maturity; or OEI shall under any
circumstances become obligated to redeem, defease or offer to buy all or any of
the subordinated notes issued under the Indentures (other than in connection
with the "Change of Control Offer" required under the terms of the 95
Indenture); or
(c) UMC Canada shall default in the payment or mandatory prepayment
when due of any principal of or interest on any Loan (as defined in the Canadian
Credit Agreement) or of any Bankers Acceptance; or UMC Canada shall default in
the payment when due any fees or other amount payable by it under the Canadian
Credit Agreement and such default shall continue for a period of five (5)
Business Days; or
(d) Any representation, warranty or certification made or deemed made
herein or in any other Loan Document by OEI or any of its Restricted
Subsidiaries, including the Company, or in any certificate furnished to any
Lender or any Agent pursuant to the provisions hereof or any other Loan
Document, shall prove to have been false or misleading as of the time made or
furnished in any material respect; or
(e) OEI or the Company shall default in the performance of any of their
respective obligations under Article IX; UMC Canada shall default in the
performance of any of its obligations under Article IX
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of the Canadian Credit Agreement; or OEI or any of its Restricted Subsidiaries,
including the Company, shall default in the performance of any of their
respective other obligations in this Agreement or under any other Loan Document
to which it is party and such default shall continue unremedied for a period of
30 days after notice thereof to OEI by the Administrative Agent or any Lender;
or
(f) OEI, the Company, UMC Canada or any Restricted Subsidiary shall
admit in writing its inability to, or be generally unable to, pay its debts as
such debts become due; or
(g) OEI, the Company, UMC Canada or any Restricted Subsidiary shall (i)
apply for or consent to the appointment of, or the taking of possession by, a
receiver, custodian, trustee or liquidator of itself or of all or a substantial
part of its property, (ii) make a general assignment for the benefit of its
creditors, (iii) commence a voluntary case under the Bankruptcy Code (as now or
hereafter in effect), (iv) file a petition seeking to take advantage of any
other law relating to bankruptcy, insolvency, reorganization, winding-up, or
composition or readjustment of debts, (v) fail to controvert in a timely and
appropriate manner, or acquiesce in writing to, any petition filed against it in
an involuntary case under the Bankruptcy Code, or (vi) take any corporate action
for the purpose of effecting any of the foregoing; or
(h) A proceeding or case shall be commenced, without the application or
consent of OEI, the Company, UMC Canada or any Restricted Subsidiary in any
court of competent jurisdiction, seeking (i) its liquidation, reorganization,
dissolution or winding-up, or the composition or readjustment of its debts, (ii)
the appointment of a trustee, receiver, custodian, liquidator or the like for
such Person or of all or any substantial part of its assets, or (iii) similar
relief in respect of any such Person under any law relating to bankruptcy,
insolvency, reorganization, winding-up, or composition or adjustment of debts,
and such proceeding or case shall continue undismissed, or an order, judgment or
decree approving or ordering any of the foregoing shall be entered and continue
unstayed and in effect, for a period of 60 days; or an order for relief against
such Person shall be entered in an involuntary case under the Bankruptcy Code;
or
(i) A final judgment or judgments for the payment of money in excess of
$15,000,000 in the aggregate in excess of insurance coverage shall be rendered
by a court or courts against OEI or any of its Restricted Subsidiaries and
either the same shall not be discharged or provision shall not be made for such
discharge, or a stay of execution thereof shall not be procured, in either case,
within 30 days from the date of entry thereof and the judgment debtor shall not,
within said period of 30 days, or such longer period during which execution of
the same shall have been stayed, appeal therefrom and cause the execution
thereof to be stayed during such appeal; or
(j) An event or condition specified in Section 9.10 shall occur or
exist with respect to any Plan or Multiemployer Plan and, as a result of such
event or condition, together with all other such events or conditions, OEI or
any ERISA Affiliate shall incur or in the opinion of the Required Lenders shall
be reasonably likely to incur a liability to a Plan, a Multiemployer Plan or
PBGC (or any combination of the foregoing) which is in excess of $15,000,000; or
(k) The Guaranty Agreement or other material Loan Document, after
delivery thereof, shall for any reason, except to the extent permitted by the
terms of this Agreement or thereof, cease to be in full
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force and effect and valid, binding and enforceable in accordance with its terms
(subject to customary exceptions therefrom); or
(l) any "person" or "group" (as such terms are used in Sections 13(d)
and 14(d) of the Securities Exchange Act of 1934, as amended), excluding
underwriters in the course of their distribution of Voting Stock in an
underwritten public offering, is or becomes the "beneficial owner" (as defined
in Rule 13d-3 of the SEC under the Securities Exchange Act of 1934), directly or
indirectly, of more than 50% of the total Voting Stock of OEI; or during any
consecutive two-year period, individuals who at the beginning of such period
constituted the Board of Directors of OEI (together with any new directors whose
election by such Board of Directors or whose nomination for election by the
stockholders of OEI was approved by a vote of a majority of the directors then
still in office who were either directors at the beginning of such period or
whose election or nomination for election was previously so approved) cease for
any reason to constitute a majority of the Board of Directors of OEI then in
office; or
(m) OEI shall cease to directly or indirectly own 100% of each class of
stock of the Company, UMC Canada or any Restricted Subsidiary (except for (i)
directors' qualifying shares and (ii) shares of Wholly Owned Restricted
Subsidiaries of the type described in clause (ii) of the definition of Wholly
Owned Restricted Subsidiaries).
THEREUPON: (i) in the case of an Event of Default other than one referred to in
clause (f), (g) or (h) of this Section 10.01 with respect to OEI, the Company or
UMC Canada, the Administrative Agent may and, upon request of the Majority
Lenders, shall, by notice to the Company, cancel the Commitments and/or declare
the principal amount of the Loans, together with accrued interest, and all other
amounts payable by the Company hereunder and under the Notes to be forthwith due
and payable, whereupon such amounts shall be immediately due and payable without
presentment, demand, protest, notice of intent to accelerate, notice of
acceleration or other formalities of any kind, all of which are hereby expressly
waived by the Company; and (ii) in the case of the occurrence of an Event of
Default referred to in clause (f), (g) or (h) of this Section 10.01 with respect
to OEI, the Company or UMC Canada, the Commitments shall be automatically
canceled and the principal amount of the Loans, together with accrued interest,
and all other amounts payable by the Company hereunder and under the Notes shall
become automatically immediately due and payable without presentment, demand,
protest, notice of intent to accelerate, notice of acceleration or other
formalities of any kind, all of which are hereby expressly waived by the
Company.
Section 10.02 Cash Collateral for Letters of Credit. If an Event of
Default exists, the Administrative Agent and the Paying Agent may, or upon the
request of the Majority Lenders, shall, proceed to enforce remedies under the
Loan Documents. Upon realization of any of the collateral consisting of cash, or
of any cash proceeds from any disposition of the collateral, all such cash and
cash proceeds shall be applied as set forth in the Intercreditor Agreement.
ARTICLE XI
The Agents
Section 11.01 Appointment, Powers and Immunities. Each Lender hereby
irrevocably appoints and authorizes the Administrative Agent, the Syndication
Agent, the Documentation Agent, the Technical Agents, the Competitive Bid
Auction Agent and each Co-Agent to act as its agent hereunder with such
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powers as are specifically delegated to it by the terms of this Agreement or any
Loan Document, together with such other powers as are reasonably incidental
thereto. (As of the Effective Date, the Co-Agents have been delegated no
specific powers or responsibilities under this Agreement.) Each Agent (which
term as used in this sentence and in Section 11.05 and the first sentence of
Section 11.06 shall include reference to its Affiliates and its own and its
Affiliates' officers, directors, employees and agents): (a) shall have no duties
or responsibilities except those expressly set forth in this Agreement and the
other Loan Documents and shall not by reason of this Agreement or any other Loan
Document be a trustee for any other Agent or Lender; (b) shall not be
responsible to any other Agent or the Lenders (i) for the accuracy of any
recitals, statements, representations or warranties contained in this Agreement
or any Loan Document or in any certificate or other document referred to or
provided for in, or received by any of them under, this Agreement; (ii) for the
value, validity, effectiveness, genuineness, enforceability or sufficiency of
this Agreement, any Note or any Loan Document or any other document referred to
or provided for herein; or (iii) for any failure by OEI, the Company or any
other Person to perform any of its obligations hereunder or thereunder; (c)
shall not be required to initiate or conduct any litigation or collection
proceedings hereunder except as may be expressly required under this Agreement
or any other Loan Document; and (d) shall not be responsible for any action
taken or omitted to be taken by it hereunder or under any other Loan Document,
except for its own gross negligence or willful misconduct. The Agents may employ
agents and attorneys-in-fact and shall not be responsible for the negligence or
misconduct of any such agents or attorneys-in-fact selected by it in good faith.
Each Agent may deem and treat the payee of any Note as the holder thereof for
all purposes hereof unless and until a written notice of the assignment or
transfer thereof shall have been filed with the Administrative Agent, together
with the written consent of the Company to such assignment or transfer.
Section 11.02 Reliance by Agents. Each Agent shall be entitled to rely:
(a) upon any certification, notice or other communication (including any thereof
by telephone, telex, telegram or cable) believed by it to be genuine and correct
and to have been signed or sent by or on behalf of the proper Person or Persons;
and (b) upon advice and statements of legal counsel, independent accountants and
other experts selected by any Agent in good faith. As to any matters not
expressly provided for by this Agreement or any Loan Document, each Agent shall
in all cases be fully protected in acting, or in refraining from acting,
hereunder in accordance with instructions signed by the Majority Lenders; and
such instructions of the Majority Lenders and any action taken or failure to act
pursuant thereto shall be binding on all of the Lenders.
Section 11.03 Defaults. No Agent shall be deemed to have knowledge of
the occurrence of a Default (other than, in the case of the Administrative
Agent, the non-payment of principal of or interest on Loans or of fees or the
non-payment of reimbursement obligations of the Company in connection with
Letters of Credit) unless it has received notice from either a Lender or the
Company specifying such Default and stating that such notice is a "Notice of
Default". In the event that any Agent receives such a notice of the occurrence
of a Default, it shall promptly give notice to the Administrative Agent who
shall thereafter give prompt notice thereof to the Lenders.
Section 11.04 Rights as a Lender. With respect to its Commitment and
the Loans made by it and the Letters of Credit issued by it or in which it is
participating, each Agent (and any successor acting as an Agent) in its capacity
as a Lender hereunder shall have the same rights and powers hereunder as any
other Lender and may exercise the same as though it were not acting as an Agent,
and the term "Lender"
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or "Lenders" shall include each Agent in its individual capacity. Each Agent
(and any successor acting as an Agent) and its Affiliates may (without having to
account therefor to any other Agent or Lender) accept deposits from, lend money
to and generally engage in any kind of banking, trust or other business with OEI
and its Subsidiaries, including the Company, or any of OEI's Affiliates as if it
were not acting as an Agent. Each Agent and its Affiliates may accept fees and
other consideration from OEI or any of its Affiliates, including the Company,
for services in connection with this Agreement, any Loan Document or otherwise
without having to account for the same to any other Agent or the Lenders.
Section 11.05 Indemnification. The Lenders agree to indemnify each
Agent (to the extent not reimbursed under Section 12.03, but without limiting
the obligations of the Company under Section 12.03), ratably in accordance with
the aggregate principal amount of the Loans made by the Lenders (or, if no Loans
are at the time outstanding, ratably in accordance with their respective
Commitments), for any and all Indemnity Matters of any kind and nature
whatsoever which may be imposed on, incurred by or asserted against such Agent
in any way relating to or arising out of: (a) this Agreement or any other Loan
Document or the transactions contemplated hereby and thereby (including, without
limitation, the costs and expenses which the Company is obligated to pay under
Section 12.03 but excluding, unless a Default has occurred and is continuing,
normal administrative costs and expenses incident to the performance of its
agency duties hereunder); or (b) the enforcement of any of the terms hereof or
of any other Loan Document; provided that no Lender shall be liable for any
Indemnity Matter to the extent it arises from the gross negligence or willful
misconduct of the Person to be indemnified; and provided further that no Lender
shall be liable for any Indemnity Matters arising solely by reason of claims
among the Agents and their shareholders. THE FOREGOING INDEMNITIES SHALL EXTEND
TO THE INDEMNIFIED PARTIES NOTWITHSTANDING THE SOLE OR CONCURRENT NEGLIGENCE OF
EVERY KIND OR CHARACTER WHATSOEVER, WHETHER ACTIVE OR PASSIVE, WHETHER AN
AFFIRMATIVE ACT OR AN OMISSION, INCLUDING WITHOUT LIMITATION, ALL TYPES OF
NEGLIGENT CONDUCT IDENTIFIED IN THE RESTATEMENT (SECOND) OF TORTS OF ONE OR MORE
OF THE INDEMNIFIED PARTIES OR BY REASON OF STRICT LIABILITY IMPOSED WITHOUT
FAULT ON ANY ONE OR MORE OF THE INDEMNIFIED PARTIES. TO THE EXTENT THAT AN
INDEMNIFIED PARTY IS FOUND BY A FINAL, NON-APPEALABLE JUDGMENT OF A COURT OR BY
AGREEMENT TO HAVE COMMITTED AN ACT OF GROSS NEGLIGENCE OR WILFUL MISCONDUCT,
THIS CONTRACTUAL OBLIGATION OF INDEMNIFICATION SHALL CONTINUE BUT SHALL ONLY
EXTEND TO THE PORTION OF THE CLAIM THAT IS DEEMED TO HAVE OCCURRED BY REASON OF
EVENTS OTHER THAN THE GROSS NEGLIGENCE OR WILFUL MISCONDUCT OF THE PARTY SEEKING
INDEMNIFICATION. IN ADDITION, THE FOREGOING INDEMNITIES EXCLUDE ALL INDEMNITY
MATTERS ARISING SOLELY BY REASON OF CLAIMS AMONG INDEMNIFIED PARTIES AND THEIR
SHAREHOLDERS.
Section 11.06 Non-Reliance on Agents and other Lenders. Each Lender
agrees: (a) that it has, independently and without reliance on any Agent or any
other Lender, and based on such documents and information as it has deemed
appropriate, made its own credit analysis of OEI and its Subsidiaries, including
the Company, and decision to enter into this Agreement; and (b) that it will,
independently and without reliance upon any 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 analysis and decisions in taking or not taking action
under this Agreement or any other Loan Document. No Agent shall be required to
keep itself informed as to the performance or observance by OEI, the Company or
any other Person of its obligations under this Agreement or any other Loan
Document or document referred to or provided for herein or to inspect the
Properties or books of OEI and its Subsidiaries, including the Company. Except
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for notices, reports and other documents and information expressly required to
be furnished to the Lenders by an Agent hereunder or under a Loan Document, no
Agent shall have any duty or responsibility to provide any other Agent or Lender
with any credit or other information concerning the affairs, financial condition
or business of OEI and its Subsidiaries, including the Company, (or any of their
Affiliates) which may come into the possession of such Agent or any of their
Affiliates.
Section 11.07 Action by Agents. Except for action or other matters
expressly required of an Agent hereunder, such Agent shall in all cases be fully
justified in failing or refusing to act hereunder unless it shall (i) receive
written instructions from the Majority Lenders specifying the action to be
taken, and (ii) be indemnified to its satisfaction by the Lenders against any
and all liability and expenses which may be incurred by it by reason of taking
or continuing to take any such action, and such instructions of the Majority
Lenders and any action taken or failure to act pursuant thereto shall be binding
on all of the Lenders. If a Default has occurred and is continuing, the
Administrative Agent shall take such action with respect to such Default as
shall be directed by the Majority Lenders in the written instructions (with
indemnities) described in this Section 11.07, provided that, unless and until
the Administrative Agent shall have received such directions, the Administrative
Agent may (but shall not be obligated to) take such action, or refrain from
taking such action, with respect to such Default as it shall deem advisable in
the best interests of the Lenders. In no event, however, shall the
Administrative Agent be required to take any action which exposes it to personal
liability or which is contrary to this Agreement and the Loan Documents or
applicable law.
Section 11.08 Resignation or Removal of Agents. Subject to the
appointment and acceptance of a successor Agent as provided in this Section
11.08, any Agent may resign at any time by giving notice thereof to the Lenders
and the Company, and any Agent may be removed at any time, for cause, by the
Required Lenders. Upon any such resignation or removal, the Required Lenders,
with the consent of the Company (which consent shall not be unreasonably
withheld or delayed), shall have the right to appoint a successor Agent. If no
successor shall have been so appointed by the Required Lenders and shall have
accepted such appointment within 30 days after either the retiring Agent's
giving of notice of resignation or the Required Lenders' removal of the retiring
Agent, then the retiring Agent may, on behalf of the Lenders, appoint its
successor. Upon the acceptance of any appointment as an Agent hereunder by a
successor, such successor shall thereupon succeed to and become vested with all
the rights, powers, privileges and duties of the retiring Agent and the retiring
Agent shall be discharged from its duties and obligations hereunder. After any
retiring Agent's resignation or removal hereunder, the provisions of this
Article XI shall continue in effect for its benefit in respect of any actions
taken or omitted to be taken by it while it was acting as an Agent.
ARTICLE XII
Miscellaneous
Section 12.01 Waiver. No failure on the part of any Agent or any Lender
to exercise, no delay in exercising, and no course of dealing with respect to,
any right, power or privilege under this Agreement or any Loan Document shall
operate as a waiver thereof; and no single or partial exercise of any right,
power or privilege under this Agreement or any Loan Document shall preclude any
other or further exercise thereof or the exercise of any other right, power or
privilege. The remedies provided herein are cumulative and not exclusive of any
remedies provided by law.
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Section 12.02 Notices. All notices and other communications provided
for herein and in the other Loan Documents (including, without limitation, any
modifications of, or waivers or consents under, this Agreement or the other Loan
Documents) shall be given or made by telecopy, telegraph, cable or in writing
and telecopied, telegraphed, cabled, mailed or delivered to the intended
recipient at the "Address for Notices" specified below its name on the signature
pages hereof; or, as to any party, at such other address as shall be designated
by such party in a notice to each other party. Except as otherwise provided in
this Agreement, all such communications shall be deemed to have been duly given
when transmitted by telecopier, delivered to the telegraph or cable office or
personally delivered or, in the case of a mailed notice, upon receipt, in each
case given or addressed as aforesaid.
Section 12.03 Payment of Expenses, Indemnities, etc. The Company agrees
to:
(a) whether or not the transactions hereby contemplated are
consummated, pay all reasonable expenses of the Administrative Agent in the
administration (both before and after the execution hereof and including advice
of counsel as to the rights and duties of the Agents and the Lenders with
respect thereto) of, and in connection with the negotiation, investigation,
preparation, execution and delivery of, recording or filing of, preservation of
rights under, enforcement of, and refinancing, renegotiation or restructuring
of, this Agreement, the Notes and the other Loan Documents and any amendment,
waiver or consent relating thereto (including, without limitation, the
reasonable fees and disbursements of counsel for the Administrative Agent and in
the case of enforcement for any of the Lenders); and promptly reimburse each
Agent or Lender for all amounts expended, advanced or incurred by such Agent or
Lender to satisfy any obligation of OEI or the Company under this Agreement or
any Loan Document; and
(b) pay and hold each of the Agents and the Lenders harmless from and
against any and all present and future stamp and other similar taxes with
respect to the foregoing matters and save each Agent and Lender harmless from
and against any and all liabilities with respect to or resulting from any delay
or omission to pay such taxes; and
(c) INDEMNIFY THE AGENTS AND EACH LENDER, THEIR OFFICERS, DIRECTORS,
EMPLOYEES, REPRESENTATIVES, AGENTS AND AFFILIATES (COLLECTIVELY, THE
"INDEMNIFIED PARTIES") FROM, HOLD EACH OF THEM HARMLESS AGAINST, PROMPTLY UPON
DEMAND PAY OR REIMBURSE EACH OF THEM FOR, AND REFRAIN FROM CREATING OR ASSERTING
AGAINST ANY OF THEM, ANY AND ALL INDEMNITY MATTERS OF ANY KIND OR NATURE
WHATSOEVER WHICH MAY BE INCURRED BY OR ASSERTED AGAINST OR INVOLVE ANY OF THEM
(WHETHER OR NOT ANY OF THEM IS DESIGNATED A PARTY THERETO) AS A RESULT OF,
ARISING OUT OF OR IN ANY WAY RELATED TO (I) OFFSETS, REDUCTIONS, REBATEMENTS OR
OTHER CLAIMS, COUNTERCLAIMS OR DEFENSES OF ANY NATURE WHATSOEVER (INCLUDING,
WITHOUT LIMITATION, CLAIMS OF USURY) OF OEI OR ANY OF ITS SUBSIDIARIES,
INCLUDING THE COMPANY, OR ANY OTHER PERSON, WHETHER IN TORT OR IN CONTRACT,
FIXED OR CONTINGENT, IN LAW OR IN EQUITY, KNOWN OR UNKNOWN, WHETHER NOW EXISTING
OR HEREAFTER ARISING, IN CONNECTION WITH OTHER LENDERS WHOSE DEBT MAY BE
REFINANCED WITH ANY PROCEEDS OF THE LOANS (IN THEIR CAPACITY AS LENDERS OR AS
AGENT FOR THE LENDERS IN CONNECTION WITH THE LOAN DOCUMENTS EXECUTED IN
CONNECTION WITH SUCH REFINANCED DEBT AND NOT OTHERWISE), THE LOAN DOCUMENTS
EXECUTED IN CONNECTION WITH SUCH REFINANCED DEBT OR ANY ACTIONS OR RELATIONSHIPS
RELATING TO ANY OF THE FOREGOING, (II) ANY ACTUAL OR PROPOSED USE BY THE COMPANY
OR ANY OF ITS SUBSIDIARIES OF THE PROCEEDS OF ANY OF THE LOANS OR LETTERS OF
CREDIT OR (III) ANY OTHER ASPECT OF THIS AGREEMENT, THE NOTES AND THE OTHER LOAN
DOCUMENTS, INCLUDING, WITHOUT
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LIMITATION, THE REASONABLE FEES AND DISBURSEMENTS OF COUNSEL AND ALL OTHER
EXPENSES INCURRED IN CONNECTION WITH INVESTIGATING, DEFENDING OR PREPARING TO
DEFEND ANY SUCH ACTION, SUIT, PROCEEDING (INCLUDING ANY INVESTIGATIONS,
LITIGATION OR INQUIRIES) OR CLAIM, BUT EXCLUDING HEREFROM ALL INDEMNITY MATTERS
ARISING SOLELY BY REASON OF CLAIMS AMONG INDEMNIFIED PARTIES AND THEIR
SHAREHOLDERS.
(d) INDEMNIFY AND HOLD EACH AGENT AND LENDER, ITS OFFICERS, DIRECTORS,
EMPLOYEES, REPRESENTATIVES, AGENTS AND AFFILIATES HARMLESS AGAINST, AND PROMPTLY
TO PAY ON DEMAND OR REIMBURSE EACH OF THEM WITH RESPECT TO, ANY AND ALL
INDEMNITY MATTERS OF ANY AND EVERY KIND OR NATURE WHATSOEVER ASSERTED AGAINST OR
INCURRED BY ANY OF THEM BY REASON OF OR ARISING OUT OF OR IN ANY WAY RELATED TO
(I) THE BREACH OF ANY REPRESENTATION OR WARRANTY AS SET FORTH HEREIN REGARDING
ENVIRONMENTAL LAWS, OR (II) THE FAILURE OF OEI OR ANY OF ITS SUBSIDIARIES,
INCLUDING THE COMPANY, TO PERFORM ANY OBLIGATION HEREIN REQUIRED TO BE PERFORMED
PURSUANT TO ENVIRONMENTAL LAWS.
(e) In the case of any indemnification hereunder, the Agent or Lender
seeking indemnification, as appropriate shall give notice to the Company of any
such claim or demand being made against the Indemnified Party; and the Company
shall have the non-exclusive right to join in the defense against any such claim
or demand.
(f) THE FOREGOING INDEMNITIES SHALL EXTEND TO THE INDEMNIFIED PARTIES
NOTWITHSTANDING THE SOLE OR CONCURRENT NEGLIGENCE OF EVERY KIND OR CHARACTER
WHATSOEVER, WHETHER ACTIVE OR PASSIVE, WHETHER AN AFFIRMATIVE ACT OR AN
OMISSION, INCLUDING WITHOUT LIMITATION, ALL TYPES OF NEGLIGENT CONDUCT
IDENTIFIED IN THE RESTATEMENT (SECOND) OF TORTS OF ONE OR MORE OF THE
INDEMNIFIED PARTIES OR BY REASON OF STRICT LIABILITY IMPOSED WITHOUT FAULT ON
ANY ONE OR MORE OF THE INDEMNIFIED PARTIES. TO THE EXTENT THAT AN INDEMNIFIED
PARTY IS FOUND BY A FINAL, NON-APPEALABLE JUDGMENT OF A COURT OR BY AGREEMENT TO
HAVE COMMITTED AN ACT OF GROSS NEGLIGENCE OR WILFUL MISCONDUCT, THIS CONTRACTUAL
OBLIGATION OF INDEMNIFICATION SHALL CONTINUE BUT SHALL ONLY EXTEND TO THE
PORTION OF THE CLAIM THAT IS DEEMED TO HAVE OCCURRED BY REASON OF EVENTS OTHER
THAN THE GROSS NEGLIGENCE OR WILFUL MISCONDUCT OF THE PARTY SEEKING
INDEMNIFICATION. IN ADDITION, THE FOREGOING INDEMNITIES EXCLUDE ALL INDEMNITY
MATTERS ARISING SOLELY BY REASON OF CLAIMS AMONG INDEMNIFIED PARTIES AND THEIR
SHAREHOLDERS.
(g) The Company's obligations under this Section 12.03 shall survive
any termination of this Agreement and the payment of the Notes and shall
continue thereafter in full force and effect.
(h) The Company shall pay any amounts due under this Section 12.03
within thirty (30) days of the receipt by the Company of notice of the amount
due.
Section 12.04 Amendments, Etc. Subject to the terms of the
Intercreditor Agreement, any provision of this Agreement or any other Loan
Documents may be amended, modified or waived with the Majority Lenders' consent;
provided that (a) the Commitment of a Lender may not be increased without the
express written consent of such Lender; (b) no amendment, modification or waiver
which amends, modifies or waives the definition of "Majority Lender" or
"Required Lenders" or any provision of
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Sections 2.03, 2.09 or 12.04 shall be effective without the express written
consent of all Lenders and the Canadian Lenders; (c) no amendment, modification
or waiver which amends or modifies the definition of "Applicable Margin" or
reduces the interest rate (other than as a result of waiving the applicability
of any post-Default increases in such rates), modifies the payment dates for
payments of either principal or interest on any Loan, modifies any fees payable
hereunder, increases the Borrowing Base or releases or modifies OEI's
obligations under the Guaranty Agreement or the Intercreditor Agreement shall be
effective without consent of all Lenders and Canadian Lenders; and (d) no
amendment, modification or waiver which modifies the rights, duties or
obligations or fees of any Agent shall be effective without the consent of such
Agent.
Section 12.05 Successors and Assigns. This Agreement shall be binding
upon and inure to the benefit of the parties hereto and their respective
successors and permitted assigns.
Section 12.06 Assignments and Participations.
(a) The Company may not assign its rights or obligations hereunder,
under the Notes or under any Letter of Credit Agreement without the prior
consent of all of the Lenders and the Administrative Agent.
(b) Each Lender may, upon the written consent of the Company and the
Administrative Agent which consent shall not be unreasonably withheld or delayed
(provided that if an Event of Default has occurred and is continuing,
assignments may be made hereunder without the Company's consent), assign to one
or more assignees all or a portion of its rights and obligations under this
Agreement pursuant to an Assignment and Acceptance Agreement substantially in
the form of Exhibit G (an "Assignment and Acceptance"); provided that (i) any
such assignment shall be in the aggregate amount of at least $5,000,000, the
entire amount of a Lender's Commitment, if less, or such other lesser amount to
which the Company has consented, and (ii) the assignee shall pay to the
Administrative Agent a processing and recordation fee of $3,500; provided that
such fee shall not be payable in conjunction with any assignments occurring
within 30 days of the Effective Date. Any such assignment will become effective
upon the issuance by the Administrative Agent of a letter of acknowledgment
reflecting such assignment and the resultant effects thereof on the Commitments
of the assignor and assignee, and the principal amount outstanding of the
Conventional Loans owed to the assignor and assignee, the Administrative Agent
hereby agreeing to effect such issuance no later than five (5) Business Days
after its receipt of an Assignment and Acceptance executed by all parties
thereto. Promptly after receipt of an Assignment and Acceptance executed by all
parties thereto, the Administrative Agent shall send to the Company a copy of
such executed Assignment and Acceptance. Upon receipt of such executed
Assignment and Acceptance, the Company, will, at its own expense, execute and
deliver new Conventional Loan Notes to the assignor and/or assignee, as
appropriate, in accordance with their respective interests as they appear on the
Administrative Agent's letter of acknowledgment. Upon the effectiveness of any
assignment pursuant to this Section, the assignee will become a "Lender," if not
already a "Lender," for all purposes of this Agreement and the other Loan
Documents. Subject to the terms of Section 12.10 of this Agreement and the
Sections referred to therein, the assignor shall be relieved of its obligations
hereunder to the extent of such assignment (and if the assigning Lender no
longer holds any rights or obligations under this Agreement, such assigning
Lender shall cease to be a "Lender" hereunder). The Administrative Agent will
prepare on the last Business Day of each month during which an assignment has
become effective
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pursuant to this Section 12.06(b), a new Annex I giving effect to all such
assignments effected during such month, and will promptly provide the same to
the Company and each of the Lenders. If an assignment is made to a Person which
had not previously been a Lender, the Company will promptly execute and deliver
to such Lender a Bid Rate Note as described in Section 2.07(b).
(c) Each Lender may transfer, grant or assign participations in all or
any part of such Lender's interests hereunder pursuant to this subsection to any
Person, provided that: (i) such Lender shall remain a "Lender" for all purposes
of this Agreement and the transferee of such participation shall not constitute
a "Lender" hereunder; and (ii) no participant under any such participation shall
have rights to approve any amendment to or waiver of this Agreement, the Notes
or any Loan Document except to the extent such amendment or waiver would (x)
extend the Termination Date, (y) reduce the principal amount of any Loan
outstanding , the interest rate (other than as a result of waiving the
applicability of any post-default increases in interest rates) or fees
applicable to any of the Commitments or Loans in which such participant is
participating, or postpone the payment of any thereof, or (z) release OEI from
its obligations under the Guaranty Agreement. In the case of any such
participation, the participant shall not have any rights under this Agreement or
any of the Loan Documents (the participant's rights against the granting Lender
in respect of such participation to be those set forth in the agreement with
such Lender creating such participation), and all amounts payable by the Company
hereunder shall be determined as if such Lender had not sold such participation,
provided that if such participant has made and complied with the representations
contained in Section 5.08, such participant shall be entitled to receive
additional amounts under Article V on the same basis as if it were a Lender
other than amounts paid by reason of such participant's noncompliance with
Section 5.08. In addition, each agreement creating any participation must
include agreements by the participant to be bound by the provisions of Section
12.14 if such participant is to receive any confidential information.
(d) Notwithstanding any other provisions of this Section 12.06, no
transfer or assignment of the interests or obligations of any Lender hereunder
or any grant of participations therein shall be permitted if such transfer,
assignment or grant would require the Company to file a registration statement
with the SEC or to qualify the Loans or any interest therein under the "Blue
Sky" laws of any state.
(e) The Lenders may furnish any information concerning the Company in
the possession of the Lenders from time to time to assignees and participants
(including prospective assignees and participants); provided that, such Persons
agree in writing to be bound by the provisions of Section 12.14 hereof.
(f) Notwithstanding anything in this Section 12.06 to the contrary, any
Lender may assign and pledge all or any of its Notes to any Federal Reserve Bank
or the United States Treasury as collateral security pursuant to Regulation A of
the Board of Governors of the Federal Reserve System and any operating circular
issued by such Federal Reserve System and/or such Federal Reserve Bank. No such
assignment and/or pledge shall release the assigning and/or pledging Lender from
its obligations hereunder.
Section 12.07 Invalidity. In the event that any one or more of the
provisions contained in the Notes, this Agreement or in any other Loan Document
shall for any reason be held invalid, illegal or
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unenforceable in any respect, such invalidity, illegality or unenforceability
shall not affect any other provision of such Note, this Agreement or any other
Loan Document.
Section 12.08 Entire Agreement. The Notes, this Agreement, the Guaranty
Agreement and the other Loan Documents embody the entire agreement and
understanding between the Lenders, the Agents, OEI and the Company and supersede
all prior agreements and understandings between such parties relating to the
subject matter hereof and thereof. There are no unwritten oral agreements
between the parties.
Section 12.09 References. The words "herein," "hereof," "hereunder" and
other words of similar import when used in this Agreement refer to this
Agreement as a whole, and not to any particular article, section or subsection.
Any reference herein to a Section shall be deemed to refer to the applicable
Section of this Agreement unless otherwise stated herein. Any reference herein
to an exhibit or schedule shall be deemed to refer to the applicable exhibit or
schedule attached hereto unless otherwise stated herein.
Section 12.10 Survival. The obligations of the Company, each Agent and
the Lenders under Sections 5.01, 5.05, 5.06, 12.03 and 12.14 shall survive the
repayment of the Loans, the expiration of the Letters of Credit and the
termination of the Commitments and any assignment by a Lender of all its Loans
or Commitments pursuant to Section 12.06(b).
Section 12.11 Captions. Captions and section headings appearing herein
or any Loan Document are included solely for convenience of reference and are
not intended to affect the interpretation of any provision of this Agreement or
such Loan Document.
Section 12.12 Counterparts. This Agreement and each Loan Document
(other than the Notes) may be executed in any number of counterparts, all of
which taken together shall constitute one and the same instrument and any of the
parties hereto may execute this Agreement or any such Loan Document by signing
any such counterpart.
Section 12.13 GOVERNING LAW; SUBMISSION TO JURISDICTION.
(a) THIS AGREEMENT AND THE NOTES (INCLUDING, BUT NOT LIMITED TO, THE
VALIDITY AND ENFORCEABILITY HEREOF AND THEREOF) SHALL BE GOVERNED BY, AND
CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF TEXAS.
(b) ANY LEGAL ACTION OR PROCEEDING WITH RESPECT TO THIS AGREEMENT, THE
NOTES OR THE OTHER LOAN DOCUMENTS TO WHICH EITHER OEI OR THE COMPANY IS A PARTY
MAY BE BROUGHT IN THE COURTS OF THE STATE OF TEXAS OR OF THE UNITED STATES OF
AMERICA FOR THE SOUTHERN DISTRICT OF TEXAS, AND, BY EXECUTION AND DELIVERY OF
THIS AGREEMENT, OEI AND THE COMPANY EACH HEREBY ACCEPTS FOR ITSELF AND (TO THE
EXTENT PERMITTED BY LAW) IN RESPECT OF ITS PROPERTY, GENERALLY AND
UNCONDITIONALLY, THE JURISDICTION OF THE AFORESAID COURTS. OEI AND THE COMPANY
HEREBY IRREVOCABLY WAIVE ANY OBJECTION, INCLUDING, WITHOUT LIMITATION, ANY
OBJECTION TO THE LAYING OF VENUE OR BASED ON THE GROUNDS OF FORUM NON
CONVENIENS, WHICH IT MAY NOW
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OR HEREAFTER HAVE TO THE BRINGING OF ANY SUCH ACTION OR PROCEEDING IN SUCH
RESPECTIVE JURISDICTIONS. THIS SUBMISSION TO JURISDICTION IS NONEXCLUSIVE AND
DOES NOT PRECLUDE THE ADMINISTRATIVE AGENT OR ANY LENDER FROM OBTAINING
JURISDICTION OVER OEI OR THE COMPANY IN ANY COURT OTHERWISE HAVING JURISDICTION.
(c) OEI and the Company irrevocably consent to the service of process
of any of the aforementioned courts in any such action or proceeding by the
mailing of copies thereof by registered or certified mail, postage prepaid, to
it, as the case may be, at its said address, such service to become effective 30
days after such mailing.
(d) Nothing herein shall affect the right of any Agent or any Lender or
any holder of a Note to serve process in any other manner permitted by law or to
commence legal proceedings or otherwise proceed against OEI or the Company in
any other jurisdiction.
(e) EACH OF THE PARTIES HERETO WAIVES, TO THE FULLEST EXTENT PERMITTED
BY APPLICABLE LAW, ANY RIGHT TO A TRIAL BY JURY IN ANY ACTION OR PROCEEDING TO
ENFORCE OR TO DEFEND ANY RIGHTS UNDER THIS AGREEMENT, THE NOTES OR ANY OTHER
LOAN DOCUMENT OR UNDER ANY AMENDMENT, INSTRUMENT, DOCUMENT OR AGREEMENT
DELIVERED OR WHICH MAY IN THE FUTURE BE DELIVERED IN CONNECTION HEREWITH OR
THEREWITH OR ARISING FROM ANY RELATIONSHIP EXISTING IN CONNECTION WITH THIS
AGREEMENT, THE NOTES OR ANY OTHER LOAN DOCUMENT AND AGREES THAT ANY SUCH ACTION
OR PROCEEDING SHALL BE TRIED BEFORE A COURT AND NOT BEFORE A JURY.
Section 12.14 Confidentiality. Each Lender and each Agent agree that
they will use their best efforts not to disclose without the prior written
consent of the Company (other than to their employees, auditors or counsel or to
another Lender if the Lender or such Lender's holding or parent company or the
Administrative Agent in its sole discretion determines that any such party
should have access to such information) any information with respect to OEI or
any of its Subsidiaries, including the Company, which is furnished pursuant to
this Agreement and which is designated by the Company to the Lenders and the
Administrative Agent in writing as confidential, provided that any Lender and
the Administrative Agent may disclose any such information (a) as has become
generally available to the public, (b) as may be required or appropriate in any
report, statement or testimony submitted to any municipal, state or Federal
regulatory body having or claiming to have jurisdiction over such Lender or the
Administrative Agent or to the Federal Reserve Board, the Federal Deposit
Insurance Company, National Association of Insurance Commissioners or similar
organizations (whether in the United States or elsewhere) or their successors,
(c) as may be required or appropriate in response to any summons or subpoena or
in connection with any litigation, (d) in order to comply with any law, order,
regulation or ruling applicable to such Lender or the Administrative Agent, and
(e) to the prospective transferee in connection with any contemplated transfer
of any of the Notes or any interest therein by such Lender or to any Affiliate
of a Lender, provided that such prospective transferee, participant or Affiliate
executes an agreement with the Company containing provisions substantially
identical to those contained in this Section.
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Section 12.15 Interest. It is the intention of the parties hereto that
each Agent and Lender shall conform strictly to usury laws applicable to it.
Accordingly, if the transactions contemplated hereby would be usurious as to any
Agent or Lender under laws applicable to it (including the laws of the United
States of America and the State of Texas or any other jurisdiction whose laws
may be mandatorily applicable to such Agent or Lender notwithstanding the other
provisions of this Agreement), then, in that event, notwithstanding anything to
the contrary in the Notes, this Agreement or any other Loan Document, it is
agreed as follows: (a) the aggregate of all consideration which constitutes
interest under law applicable to any Agent or Lender that is contracted for,
taken, reserved, charged or received by such Agent or Lender under the Notes,
this Agreement or under any of the other aforesaid Loan Documents or agreements
or otherwise in connection with the Notes shall under no circumstances exceed
the maximum amount allowed by such applicable law, and any excess shall be
canceled automatically and if theretofore paid shall be credited by such Agent
or Lender on the principal amount of the Indebtedness (or, to the extent that
the principal amount of the Indebtedness shall have been or would thereby be
paid in full, refunded by such Agent or Lender to the Company); and (b) in the
event that the maturity of the Notes is accelerated by reason of an election of
the holder thereof resulting from any Event of Default under this Agreement or
otherwise, or in the event of any required or permitted prepayment, then such
consideration that constitutes interest under law applicable to any Agent or
Lender may never include more than the maximum amount allowed by such applicable
law, and excess interest, if any, provided for in this Agreement or otherwise
shall be canceled automatically by such Agent or Lender as of the date of such
acceleration or prepayment and, if theretofore paid, shall be credited by such
Agent or Lender on the principal amount of the Indebtedness (or, to the extent
that the principal amount of the Indebtedness shall have been or would thereby
be paid in full, refunded by such Agent or Lender to the Company). All sums paid
or agreed to be paid to any Agent or Lender for the use, forbearance or
detention of sums due hereunder shall, to the extent permitted by law applicable
to such Agent or Lender, be amortized, prorated, allocated and spread throughout
the term of the Loans evidenced by the Notes until payment in full so that the
rate or amount of interest on account of any Loans or other amounts hereunder
does not exceed the maximum amount allowed by such applicable law. If at any
time and from time to time (i) the amount of interest payable to any Agent or
Lender on any date shall be computed at the Highest Lawful Rate applicable to
such Agent or Lender pursuant to this Section 12.15 and (ii) in respect of any
subsequent interest computation period the amount of interest otherwise payable
to such Agent or Lender would be less than the amount of interest payable to
such Agent or Lender computed at the Highest Lawful Rate applicable to such
Agent or Lender, then the amount of interest payable to such Agent or Lender in
respect of such subsequent interest computation period shall continue to be
computed at the Highest Lawful Rate applicable to such Agent or Lender until the
total amount of interest payable to such Agent or Lender shall equal the total
amount of interest which would have been payable to such Agent Lender if the
total amount of interest had been computed without giving effect to this Section
12.15.
To the extent that the Texas Credit Title is relevant to any Agent or
Lender for the purpose of determining the Highest Lawful Rate, each such Agent
and Lender hereby elects to determine the applicable rate ceiling under the
Texas Credit Title by the weekly rate ceiling from time to time in effect.
Section 12.16 Effectiveness. This Agreement and the Loan Documents
shall not be effective until the date (the "Effective Date") that each of them
is delivered to the Administrative Agent in the State of Texas, and accepted by
the Administrative Agent in such State.
-82-
Section 12.17 Release of Liens and Guaranties Securing Prior Credit
Agreements. Each Agent and Lender hereby authorizes the Administrative Agent or
its Affiliate, The Chase Manhattan Bank, in its capacity as administrative agent
under the Prior Credit Agreements, on behalf of each such Agent or Lender, to:
(a) execute the Master Release, in substantially the form of Exhibit H hereto,
together with any and all releases of Liens, termination statements and other
instruments required or requested thereunder; (b) indorse in blank, without
recourse or warranty, any instruments previously endorsed to the order the
Administrative Agent or its Affiliate and delivered to it as collateral for the
obligations under either Prior Credit Agreement; (c) return any instrument,
including stock certificates, previously delivered to the Administrative Agent
or its Affiliates as collateral for the obligations under either Prior Credit
Agreement; and (d) take any other actions reasonably requested by OEI or the
Company pursuant to the terms of the Master Release which is not inconsistent
with the terms thereof. Subject to the terms of the Master Release, in
substantially the form attached hereto as Exhibit H, each Agent and Lender
hereby releases, terminates and discharges the Liens, guarantees and other
obligations described in the Master Release as being released, terminated or
discharged thereby and acknowledges that such release, termination and discharge
shall be and is evidenced by its execution of this Agreement and the execution
by the Administrative Agent or its Affiliate of the Master Release.
Section 12.18 Survival of Obligations. To the extent that any payments
on the Indebtedness or proceeds of any collateral are subsequently invalidated,
declared to be fraudulent or preferential, set aside or required to be repaid to
a trustee, debtor in possession, receiver or other Person under any bankruptcy
law, common law or equitable cause, then to such extent, the Indebtedness so
satisfied shall be revived and continue as if such payment or proceeds had not
been received and the Paying Agent's (held for the benefit of the Agents and the
Lenders) Liens (if any), rights, powers and remedies under this Agreement and
each Loan Document shall continue in full force and effect. In such event, each
Loan Document shall be automatically reinstated and OEI shall, and shall cause
the Company and each of its Restricted Subsidiaries to, take such action as may
be reasonably requested by the Administrative Agent and the Lenders to effect
such reinstatement.
Section 12.19 Debt Characterization for Indenture Purposes; Specified
or Designated Senior Indebtedness.
(a) If so designated by OEI in its internal records (which designation
may be made in its sole and absolute discretion), any Debt incurred hereunder
and under the Canadian Credit Agreement and all guarantees thereof shall
constitute "Indebtedness" other than "Permitted Indebtedness" or "Permitted
Subsidiary Indebtedness" (as such terms are defined in the Indentures) for
purposes of any Indenture.
(b) OEI and the Company hereby acknowledges and declares that:
(i) this Agreement and the Notes and the obligations of OEI
and the Company hereunder and thereunder are "Senior Indebtedness" and
"Specified Senior Indebtedness" and "Guarantor Senior Indebtedness" and
"Specified Guarantor Senior Indebtedness", respectively, under and for
purposes of the 95 Indenture;
(ii) this Agreement and the Notes and the obligations of OEI
and the Company hereunder and thereunder are "Senior Indebtedness" and
"Designated Senior Indebtedness" and "Guarantor Senior
-83-
Indebtedness" and "Designated Guarantor Senior Indebtedness",
respectively, under and for purposes of the 96 Indenture; and
(iii) this Agreement and the Notes and the obligations of OEI and the
Company hereunder and thereunder are "Senior Indebtedness" and
"Designated Senior Indebtedness" and "Guarantor Senior Indebtedness"
and "Designated Guarantor Senior Indebtedness", respectively, under and
for purposes of the 97 Indenture;
and that as such, the Lender Group is entitled to the rights and
privileges afforded holders of Senior Indebtedness, Specified Senior
Indebtedness or Designated Senior Indebtedness, Senior Guarantor
Indebtedness, Specified Guarantor Senior Indebtedness or Designated
Guarantor Senior Indebtedness under each of the Indentures.
Section 12.20 EXCULPATION PROVISIONS. EACH OF THE PARTIES HERETO
SPECIFICALLY AGREES THAT IT HAS A DUTY TO READ THIS AGREEMENT AND THE OTHER LOAN
DOCUMENTS AND AGREES THAT IT IS CHARGED WITH NOTICE AND KNOWLEDGE OF THE TERMS
OF THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS; THAT IT HAS IN FACT READ THIS
AGREEMENT AND IS FULLY INFORMED AND HAS FULL NOTICE AND KNOWLEDGE OF THE TERMS,
CONDITIONS AND EFFECTS OF THIS AGREEMENT; THAT IT HAS BEEN REPRESENTED BY
INDEPENDENT LEGAL COUNSEL OF ITS CHOICE THROUGHOUT THE NEGOTIATIONS PRECEDING
ITS EXECUTION OF THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS; AND HAS RECEIVED
THE ADVICE OF ITS ATTORNEY IN ENTERING INTO THIS AGREEMENT AND THE OTHER LOAN
DOCUMENTS; AND THAT IT RECOGNIZES THAT CERTAIN OF THE TERMS OF THIS AGREEMENT
AND THE OTHER LOAN DOCUMENTS RESULT IN ONE PARTY ASSUMING THE LIABILITY INHERENT
IN SOME ASPECTS OF THE TRANSACTION AND RELIEVING THE OTHER PARTY OF ITS
RESPONSIBILITY FOR SUCH LIABILITY. EACH PARTY HERETO AGREES AND COVENANTS THAT
IT WILL NOT CONTEST THE VALIDITY OR ENFORCEABILITY OF ANY EXCULPATORY PROVISION
OF THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS ON THE BASIS THAT THE PARTY HAD
NO NOTICE OR KNOWLEDGE OF SUCH PROVISION OR THAT THE PROVISION IS NOT
"CONSPICUOUS."
-84-
The parties hereto have caused this Agreement to be duly
executed as of the day and year first above written.
[SIGNATURES BEGIN ON THE NEXT PAGE]
-85-
OCEAN ENERGY, INC., a Louisiana corporation
By: /s/ Xxxxxxxx X. Xxxxxxxx
---------------------------------
Xxxxxxxx X. Xxxxxxxx
Executive Vice President
Chief Financial Officer
0000 Xxxxxxxxx, Xxxxx 0000
Xxxxxxx, Xxxxx 00000
Telecopier No.: (000) 000-0000
Telephone No.: (000) 000-0000
Attention: Xxxxx Xxxxxxxxxx
with copy to:
0000 Xxxxxxxxx, Xxxxx 0000
Xxxxxxx, Xxxxx 00000
Telecopier No.: (000) 000-0000
Telephone No.: (000) 000-0000
Attention: Xxxxxx X. Xxxxxx
[Signature Page 1]
OCEAN ENERGY, INC., a Delaware corporation
By: /s/ Xxxxxxxx X. Xxxxxxxx
-------------------------------
Xxxxxxxx X. Xxxxxxxx
Executive Vice President
Chief Financial Officer
0000 Xxxxxxxxx, Xxxxx 0000
Xxxxxxx, Xxxxx 00000
Telecopier No.: (000) 000-0000
Telephone No.: (000) 000-0000
Attention: Xxxxx Xxxxxxxxxx
with copy to:
0000 Xxxxxxxxx, Xxxxx 0000
Xxxxxxx, Xxxxx 00000
Telecopier No.: (000) 000-0000
Telephone No.: (000) 000-0000
Attention: Xxxxxx X. Xxxxxx
[Signature Page 2]
AGENTS: CHASE BANK OF TEXAS, NATIONAL
ASSOCIATION, as Administrative Agent
By: /s/ Xxxxxxx Xxxxxxx
--------------------------------
Xxxxxxx Xxxxxxx
Vice President
Address for Notices to Chase as
Administrative Agent:
Chase Bank of Texas, National Association
0000 Xxxxxx
Xxxxxxx, Xxxxx 00000
Telecopier No.: (000) 000-0000
Telephone No.: (000) 000-0000
Attention: Loan Syndication Services
with a copy to:
Chase Securities, Inc.
000 Xxxxxx, 00xx Xxxxx
Xxxxxxx, Xxxxx 00000
Telecopier No.: (000) 000-0000
Telephone No.: (000) 000-0000
Attention: Xxxxxx Xxxxxxxxxxx
[Signature Page 3]
XXXXXX GUARANTY TRUST COMPANY OF NEW YORK,
as Syndication Agent
By: /s/ Xxxx Xxxxxxxxx
---------------------------------
Xxxx Xxxxxxxxx
Vice President
Address for Notices for Xxxxxx as
Syndication Agent:
Xxxxxx Guaranty Trust Company
of New York
C/O X.X. Xxxxxx Services, Inc.
000 Xxxxxxx Xxxxxxxxxx Xxxx
Xxxxxx, Xxxxxxxx 00000-0000
Telecopier No.: (000) 000-0000
Telephone No.: (000) 000-0000
Attention: Xxxxxxx Xxxxxx
[Signature Page 4]
BARCLAYS BANK PLC, as Documentation Agent
By: Illegible Signature
-------------------------------
Name:
Title:
Address for Notices to Barclays as
Documentation Agent:
000 Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Telecopier No.: (000) 000-0000
Telephone No.: (000) 000-0000
Attention: Xxxxxx Xxxxxx
[Signature Page 5]
ABN AMRO BANK, N.V., as Co-Agent
By: /s/ Xxxxxxx X. Xxxxxxx
-----------------------------
Xxxxxxx X. Xxxxxxx
Senior Vice President
By: /s/ Xxxxxx Xxxxxxxx
-----------------------------
Xxxxxx Xxxxxxxx
Senior Vice President
Address for Notices for ABN
AMRO as Co-Agent:
Xxxxx Xxxxxxxx Xxxxx 0000
Xxxxxxx, Xxxxx 00000
Telecopier No.: (000) 000-0000
Telephone No.: (000) 000-0000
Attention: Xxxxx Xxxxxxx
with copy to:
Credit Administration
000 Xxxxx XxXxxxx Xxxxxx,
Xxxxx 0000
Xxxxxxx, Xxxxxxxx 00000
Telecopier No.: (000) 000-0000
Telephone No.: (000) 000-0000
[Signature Page 6]
-6-
BANK OF AMERICA NATIONAL TRUST AND
SAVINGS ASSOCIATION , as Co-Agent
By: Illegible Signature
Name:
Title:
Address for Notices for Bank of America
as Co-Agent:
000 X. XxXxxxx Xxxxxx
Xxxxxxx, Xxxxxxxx 00000
Telecopy No: (000) 000-0000
Telephone No: (000) 000-0000
Attn: Xxx Xxxxxx
[Signature Page 7]
BANQUE PARIBAS, as Co-Agent
By: Illegible Signature
-----------------------------
Name:
Title:
By: Illegible Signature
------------------------------
Name:
Title:
Address for Notices for Banque Paribas
as Co-Agent:
0000 Xxxxx Xxxxxx, Xxxxx 0000
Xxxxxxx, Xxxxx 00000
Attn: Xxxx Xxxxx Xxxxxx or Xxxxxxxx Xxxxxx
Telecopy No: (000) 000-0000
Telephone No: (000) 000-0000
with copy to:
Banque Paribas
Houston Agency
0000 Xxxxx Xxxxxx, Xxxxx 0000
Xxxxxxx, Xxxxx 00000
Telecopy: (000) 000-0000
Telephone: (000) 000-0000
Attn: Xxxx Xxxxxxx
Vice President
[Signature Page 8]
NATIONSBANK OF TEXAS, N.A., as Co-Agent
By: /s/ Xxxx Xxxxxxx
---------------------------
Xxxx Xxxxxxx
Senior Vice President
Address for Notices for
NationsBank as Co-Agent:
000 Xxxx Xxxxxx
Xxxxxx, Xxxxx 00000
Attn: Xxxxx Xxxxxx
Telecopy No: (000) 000-0000
Telephone No: (000) 000-0000
with copy to:
NationsBank of Texas, N.A.
000 Xxxxxxxxx, 0xx Xxxxx
Xxxxxxx, Xxxxx 00000
Telecopy: (000) 000-0000
Telephone: (000) 000-0000
Attn: Xxxx Xxxxxxx
Senior Vice President
[Signature Page 9]
SOCIETE GENERALE, SOUTHWEST AGENCY , as Co-
Agent
By: /s/ Xxxxxxx Xxxxxx
-------------------------
Xxxxxxx Xxxxxx
Vice President
Address for Notices for Societe Generale
as Co-Agent:
0000 Xxxx Xxxxxx, Xxxxx 0000
Xxxxxx, Xxxxx 00000
Attention: Loan Administration
Telecopy No: (000) 000-0000
Telephone No: (000) 000-0000
with copy to:
Societe Generale
0000 Xxxxx, Xxxxx 0000
Xxxxxxx, Xxxxx 00000
Telecopy: (000) 000-0000
Telephone: (000) 000-0000
Attention: Xxxxxxx Xxxxxx
Vice President
[Signature Page 10]
XXXXX FARGO BANK (TEXAS), N.A., as Co-Agent
By: /s/ J. Xxxx Xxxxxxxxx
------------------------------
J. Xxxx Xxxxxxxxx
Vice President
Address for Notices for Xxxxx Fargo Bank
as Co-Agent:
000 Xxxxx Xxxxxx, 0xx Xxxxx
Xxx Xxxxxxxxx, Xxxxxxxxxx 00000
Telecopy: (000) 000-0000
Telephone: (000) 000-0000
Attention: Xxxxx Xxxxxxxx
with copy to:
Xxxxx Fargo Bank (Texas), XX
Xxxxxx Xxxxxxxxxx
0000 Xxxxxxxxx, Xxxxx Xxxxx
Telecopy No: (000) 000-0000
Telephone No: (000) 000-0000
Attention: J. Xxxx Xxxxxxxxx
[Signature Page 11]
LENDER: CHASE BANK OF TEXAS, NATIONAL
ASSOCIATION
By: /s/ Xxxxxxx Xxxxxxx
---------------------------
Xxxxxxx Xxxxxxx
Vice President
Lending Office for ABR Loans and
Eurodollar Loans:
Chase Bank of Texas, National Association
0000 Xxxxxx
Xxxxxxx, Xxxxx 00000
Telecopier No.: (000) 000-0000
Telephone No.: (000) 000-0000
Attention: Loan Syndication Services
with copy to:
Chase Securities Inc.
000 Xxxxxx, 00xx Xxxxx
Xxxxxxx, Xxxxx 00000
Telecopier No.: (000) 000-0000
Telephone No.: (000) 000-0000
Attention: Xxxxxx Xxxxxxxxxxx
[Signature Page 12]
XXXXXX GUARANTY TRUST COMPANY OF NEW
YORK
By: /s/ Xxxx Xxxxxxxxx
--------------------------
Xxxx Xxxxxxxxx
Vice President
Lending Office for Base Rate Loans
and Eurodollar Loans:
Xxxxxx Guaranty Trust Company
of New York
00 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Address for Notices:
Xxxxxx Guaranty Trust Company
of New York
C/O X.X. Xxxxxx Services, Inc.
000 Xxxxxxx Xxxxxxxxxx Xxxx
Xxxxxx, Xxxxxxxx 00000-0000
Telecopier No.: (000) 000-0000
Telephone No.: (000) 000-0000
Attention: Xxxxxxx Xxxxxx
with a copy to:
Xxxxxx Guaranty Trust Company
of New York
00 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Telex No.: 177615MGTUT
Telecopier No.: (000) 000-0000
Telephone No.: (000) 000-0000
Attention: Xxxx Xxxxxxxxx
[Signature Page 13]
BARCLAYS BANK PLC
By: Illegible Signature
Name:
Title:
Lending Office for ABR Loans and
Eurodollar Loans:
Barclays Bank PLC - New York Branch
ABA # 020-002574
CLAD Control Account # 050-019104
Credit: Ocean Energy
Address for Notices:
000 Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Telecopier No.: (000) 000-0000
Telephone No.: (000) 000-0000
Attention: Xxxxxx Xxxxxx
[Signature Page 14]
ABN AMRO BANK, N.V.
By: /s/ Xxxxxxx X. Xxxxxxx
-------------------------
Xxxxxxx X. Xxxxxxx
Senior Vice President
By: /s/ Xxxxxx Xxxxxxxx
-------------------------
Xxxxxx Xxxxxxxx
Senior Vice President
Lending Office for ABR Loans and
Eurodollar Loans:
000 Xxxxx XxXxxxx Xxxxxx, Xxxxx 0000
Xxxxxxx, Xxxxxxxx 00000
Attention: Credit Administration
Address for Notices:
000 Xxxxx XxXxxxx Xxxxxx, Xxxxx 0000
Xxxxxxx, Xxxxxxxx 00000
Telecopier No.: (000) 000-0000
Telephone No.: (000) 000-0000
Attention: Credit Administration
with copy to:
ABN AMRO North America, Inc.
Xxxxx Xxxxxxxx, Xxxxx 0000
Xxxxxxx, Xxxxx 00000
Telecopier No.: (000) 000-0000
Telephone No.: (000) 000-0000
Attention: Xxxxx Xxxxxxx
[Signature Page 15]
BANK OF AMERICA NATIONAL TRUST AND
SAVINGS ASSOCIATION
By: Illegible Signature
Name:
Title:
Lending Office for ABR Loans and
Eurodollar Loans:
Bank of America NT & SA
000 X. XxXxxxx Xxxxxx
Xxxxxxx, XX 00000
Assignee's Eurodollar Lending Office:
Bank of America NT & SA
000 X. XxXxxxx Xxxxxx
Xxxxxxx, XX 00000
Address for Notice:
000 X. XxXxxxx Xxxxxx
Xxxxxxx, Xxxxxxxx 00000
Telecopy No: (000) 000-0000
Telephone No: (000) 000-0000
Attention: Xxx Xxxxxx
with copy to:
000 Xxxx Xxxxxx, Xxxxx 0000
Xxxxxxx, Xxxxx 00000
Telecopy No: (000) 000-0000
Telephone No: (000) 000-0000
Attention: Xxxxxx X. XxXxxx
[Signature Page 16]
BANQUE PARIBAS
By: /s/ Xxxx Xxxxxxx
-----------------------
Xxxx Xxxxxxx
Vice President
By: /s/ Xxxxxx X. Xxxxxxxx
------------------------
Xxxxxx X. Xxxxxxxx
Managing Director
Base Rate and Eurodollar Lending Office:
0000 Xxxxx Xxxxxx, Xxxxx 0000
Xxxxxxx, Xxxxx 00000
Address for Notice:
0000 Xxxxx Xxxxxx, Xxxxx 0000
Xxxxxxx, Xxxxx 00000
Attn: Xxxx Xxxxx-Xxxxxx or Xxxxxxxx Xxxxxx
Telecopy No: (000) 000-0000
Telephone No: (000) 000-0000
with copy to:
Banque Paribas
Houston Agency
0000 Xxxxx Xxxxxx, Xxxxx 0000
Xxxxxxx, Xxxxx 00000
Telecopy: (000) 000-0000
Telephone: (000) 000-0000
Attn: Xxxx Xxxxxxx
Vice President
[Signature Page 17]
NATIONSBANK OF TEXAS, N.A.
By: /s/ Xxxx Xxxxxxx
------------------------
Xxxx Xxxxxxx
Senior Vice Presiden
Base Rate and Eurodollar Lending Office:
000 Xxxx Xxxxxx
Xxxxxx, Xxxxx 00000
Address for Notice:
000 Xxxx Xxxxxx
Xxxxxx, Xxxxx 00000
Attn: Xxxxx Xxxxxx
Telecopy No: (000) 000-0000
Telephone No: (000) 000-0000
with copy to:
NationsBank of Texas, N.A.
000 Xxxxxxxxx, 0xx Xxxxx
Xxxxxxx, Xxxxx 00000
Telecopy: (000) 000-0000
Telephone: (000) 000-0000
Attn: Xxxx Xxxxxxx
Senior Vice President
[Signature Page 18]
SOCIETE GENERALE, SOUTHWEST AGENCY
By: /s/ Xxxxxxx Xxxxxx
-----------------------------
Xxxxxxx Xxxxxx
Vice President
Base Rate and Eurodollar Lending Office:
0000 Xxxx Xxxxxx, Xxxxx 0000
Xxxxxx, Xxxxx 00000
Address for Notice:
0000 Xxxx Xxxxxx, Xxxxx 0000
Xxxxxx, Xxxxx 00000
Telecopy No: (000) 000-0000
Telephone No: (000) 000-0000
Attention: Loan Administration
with copy to:
Societe Generale
0000 Xxxxx, Xxxxx 0000
Xxxxxxx, Xxxxx 00000
Telecopy: (000) 000-0000
Telephone: (000) 000-0000
Attention: Xxxxxxx Xxxxxx
Vice President
[Signature Page 19]
XXXXX FARGO BANK (TEXAS), N.A.
By: /s/ J. Xxxx Xxxxxxxxx
---------------------------
J. Xxxx Xxxxxxxxx
Vice President
Base Rate and Eurodollar Lending Office:
000 Xxxxx Xxxxxx, 0xx Xxxxx
Xxx Xxxxxxxxx, Xxxxxxxxxx 00000
Address for Notice:
000 Xxxxx Xxxxxx, 0xx Xxxxx
Xxx Xxxxxxxxx, Xxxxxxxxxx 00000
Telecopy: (000) 000-0000
Telephone: (000) 000-0000
Attention: Xxxxx Xxxxxxxx
with copy to:
Xxxxx Fargo Bank (Texas), XX
Xxxxxx Xxxxxxxxxx
0000 Xxxxxxxxx, Xxxxx Xxxxx
Telecopy No: (000) 000-0000
Telephone No: (000) 000-0000
Attention: J. Xxxx Xxxxxxxxx
[Signature Page 20]
HIBERNIA NATIONAL BANK
By: /s/ Xxxxxxx XxXxxx
--------------------------------
Xxxxxxx XxXxxx
Vice President
Lending Office for ABR Loans and
Eurodollar Loans:
000 Xxxxxxxxxx Xxxxxx
Xxx Xxxxxxx, XX 00000
Address for Notices:
000 Xxxxxxxxxx Xxxxxx, Xxxxx 0000
Xxx Xxxxxxx, XX 00000
Telecopier No.:(000) 000-0000
Telephone No.: (000) 000-0000
Attention: Energy/Maritime Department
[Signature Page 21]
TORONTO DOMINION (TEXAS) INC.
By: Illegible Signature
Name:
Title:
Lending Office for ABR Loans and
Eurodollar Loans:
000 Xxxxxx, Xxxxx 0000
Xxxxxxx, Xxxxx 00000
Address for Notices:
000 Xxxxxx, Xxxxx 0000
Xxxxxxx, Xxxxx 00000
Telecopier No.:(000) 000-0000
Telephone No.: (000) 000-0000
Attention: Xxxx Xxxxx
[Signature Page 22]
U.S. BANK NATIONAL ASSOCIATION
By: Illegible Signature
Name:
Title:
Base Rate and Eurodollar Lending Office:
000 00xx Xxxxxx, Xxxxx 000
Xxxxxx, Xxxxxxxx 00000
Address for Notice:
000 00xx Xxxxxx, Xxxxx 000
Xxxxxx, Xxxxxxxx 00000
Telecopy No: (000) 000-0000
Telephone No: (000) 000-0000
Attention: Xxxxxxx X. Xxxxxx
[Signature Page 23]
BANK ONE, TEXAS, N.A.
By: Illegible Signature
Name:
Title:
Lending Office for ABR Loans and
Eurodollar Loans:
000 Xxxxxx, 0xx Xxxxx
Xxxxxxx, Xxxxx 00000
Address for Notices:
Bank One, Texas, N.A.
000 Xxxxxx, 0xx Xxxxx
Xxxxxxx, Xxxxx 00000
Telecopier No.: (000) 000-0000
Telephone No.: (000) 000-0000
Attention: Xxxx Xxxx
[Signature Page 24]
CREDIT SUISSE FIRST BOSTON
By: Illegible Signature
Name:
Title:
By: Illegible Signature
Name:
Title:
Lending Office for ABR Loans and
Eurodollar Loans:
00 Xxxxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Address for Notices:
00 Xxxxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Telecopier No.: (000) 000-0000
Telephone No.: (000) 000-0000
Attention: Xxxxxxx Xxxxxxxx
Xxxxx Xxxxx
with copy to:
000 Xxxxxx, 00xx Xxxxx
Xxxxxxx, Xxxxx 00000
Telecopier No.: (000) 000-0000
Telephone No.: (000) 000-0000
Attention: Xxxxx Xxxxx
[Signature Page 25]
FIRST NATIONAL BANK OF COMMERCE
By: /s/ Xxxxx X. Xxxx
--------------------------
Xxxxx X. Xxxx
Senior Vice President
Lending Office for ABR Loans and Eurodollar Loans:
000 Xxxxxxx Xxxxxx
Xxx Xxxxxxx, Xxxxxxxxx 00000
Address for Notices:
First National Bank of Commerce
000 Xxxxxxx Xxxxxx
Xxx Xxxxxxx, Xxxxxxxxx
Telecopier No.: (000) 000-0000
Telephone No.: (000) 000-0000
Attention: Xxxxxx Xxxxx
with copy to:
000 Xxxxxxxxx Xxxxxx, 0xx Xxxxx
Xxxxxxxxx, Xxxxxxxxx 00000
Telecopier No: (000) 000-0000
Telephone No: (000) 000-0000
Attention: Xxxxx X. Xxxx
Senior Vice President
[Signature Page 26]
BANK OF NEW YORK
By: Illegible Signature
Name:
Title:
Lending Office for ABR Loans and
Eurodollar Loans:
Xxx Xxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Address for Notices:
Xxx Xxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Telecopier No.:(000) 000-0000
Telephone No.: (000) 000-0000
Attention: Xxxxxxx Xx Xxxxxx
[Signature Page 27]
SOUTHWEST BANK OF TEXAS, N.A.
By: /s/ A. Xxxxxxx Xxxxxxx
-------------------------
A. Xxxxxxx Xxxxxxx
Vice President/Manager Energy Lending
Lending Office for ABR Loans and
Eurodollar Loans:
0 Xxxx Xxx Xxxx
0000 Xxxx Xxx Xxxxxxx
Xxxxxxx, Xxxxx 00000
Address for Notices:
0 Xxxx Xxx Xxxx
0000 Xxxx Xxx Xxxxxxx
Xxxxxxx, Xxxxx 00000
Telecopier No.: (000) 000-0000
Telephone No.: (000) 000-0000 x0000
Attention: A. Xxxxxxx Xxxxxxx
[Signature Page 27]
-27-
AGENT: THE CHASE MANHATTAN BANK, as Competitive Bid
Auction Agent
By: Illegible Signature
Name:
Title:
Address for Notices to Chase as Competitive
Bid Auction Agent:
The Chase Manhattan Bank
Loan and Agency Services
Xxx Xxxxx Xxxxxxxxx Xxxxx, 0xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Telecopier No.: (000) 000-0000
Telephone No.: (000) 000-0000
Attention: Xxxxx Xxxxxxxx
[Signature Page 29]