SCHEDULE H-6 THIS DEBENTURE PLEDGE AGREEMENT made as of ·, 20·; (· [INSERT NAME OF RELEVANT MATERIAL SUBSIDIARY OR BAYTEX ENERGY TRUST])
SCHEDULE
H-6
THIS DEBENTURE PLEDGE
AGREEMENT made as of ·, 20·;
(· [INSERT NAME OF RELEVANT
MATERIAL SUBSIDIARY OR BAYTEX ENERGY TRUST])
Description of Floating
Charge Demand Debenture
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Principal
Sum:
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$1,000,000,000
Canadian Dollars
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Interest
Rate:
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20.0%
per annum
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Date:
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·, 20·
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WHEREAS:
A. The
Toronto-Dominion Bank and certain other lenders (collectively, the “Lenders”)
and The Toronto-Dominion Bank in its capacity as agent on behalf of the Lenders
(in that capacity, the “Agent”) have entered into an Amended and Restated Credit
Agreement with Baytex Energy Ltd. (the “Borrower”), as borrower, made as of July
9, 2003, as amended and restated as of September 3, 2003, as further amended and
restated as of June 9, 2006 and as further amended and restated as of November
29, 2007 (as further amended, modified, supplemented or restated from time to
time, the “Credit Agreement”) pursuant to which the Lenders have agreed to make
certain credit facilities available to the Borrower;
B. · [insert name of relevant Material
Subsidiary or Baytex Energy Trust] (the “Debtor”) is [a Subsidiary OR the parent]
of the Borrower and has executed and delivered to the Agent and the Lenders a
Guarantee made as of even date herewith (as amended, modified, supplemented or
restated from time to time, the “Guarantee”) wherein, inter alia, the Debtor has
guaranteed all present and future Obligations (as hereinafter
defined);
C. In order
to secure the payment and performance of all present and future Obligations (as
hereinafter defined) of the Debtor to the Agent, the Lenders and the Hedging
Affiliates (collectively, the “Beneficiaries”), the Debtor has created and
issued to the Agent the debenture described above (as the same may hereafter be
amended, modified, supplemented and restated from time to time, the
“Debenture”);
D. The
purpose of this Debenture Pledge Agreement is to set forth the terms and
conditions upon which the Debenture is to be held by the Agent;
NOW THEREFORE, for good and
valuable consideration, the receipt and sufficiency of which is hereby
conclusively acknowledged by the Debtor, the Debtor hereby agrees and covenants
with the Agent as follows:
1. The
Debtor hereby grants a security interest in and deposits with and pledges to the
Agent the Debenture to be held by the Agent as general and continuing collateral
security for the payment and performance of all present and future obligations,
liabilities and indebtedness (absolute or contingent, matured or otherwise) of
the Debtor to the Beneficiaries under, pursuant or relating to the Guarantee and
other Documents, in each case whether the same are from time to time reduced and
thereafter increased or entirely extinguished and thereafter incurred again
(collectively, the “Obligations”).
2. The Agent
shall neither demand payment pursuant to the Debenture nor enforce the security
constituted thereby unless the Agent shall be entitled to do so pursuant to the
provisions of the Guarantee and other Documents and the other agreements,
instruments or documents establishing, creating or evidencing any Obligations
(collectively, the “Credit Documents”), but thereafter the Agent may at any time
exercise and enforce all of the rights and remedies of a holder of the Debenture
as if the Agent was the absolute owner thereof without notice to or control by
the Debtor, and any such remedy may be exercised separately or in combination
with, and shall be in addition to and not in substitution for, any other right
or remedy of the Agent and the Beneficiaries however created, provided that the
Agent shall not be bound to exercise any such right or remedy.
3. Subject
to the requirements of applicable law, the Agent shall not be bound under any
circumstances to realize upon or under the Debenture and shall not be
responsible to the Debtor for any loss occasioned by any sale or other dealing
with the Debenture or the Charged Premises (as defined in the Debenture) or by
the retention of or failure to sell or otherwise deal with the
same.
4. The
proceeds of or any other amount received pursuant to the Debenture shall be
applied by the Agent on account of the Obligations in such order as the Agent
sees fit without prejudice to the Agent’s or the Beneficiaries’ claim upon the
Debtor for any deficiency. Subject to the requirements of applicable
law, any surplus realized by the Agent in excess of the Obligations shall be
paid over to the Debtor.
5. Subject
to paragraph 2 hereof, the Agent shall not be obliged to exhaust its
recourse against the Debtor, any other person or persons, or any other security
it may hold with respect to the Obligations before realizing upon, under, or
otherwise dealing with the Debenture in such manner as the Agent sees
fit. The Agent and the Beneficiaries may grant extensions of time or
other indulgences, take and give up securities, accept compositions, grant
releases and discharges and otherwise deal with the Debtor and with other
parties, sureties or securities as it may see fit, without prejudice to the
liability of the Debtor or the Agent’s or the Beneficiaries’ rights in respect
of the Debenture.
6. Notwithstanding
the stated interest rate per annum in the Debenture, payment to the
Beneficiaries or, in the case of Obligations payable pursuant to the Credit
Agreement, the Agent for the account of the Lenders of the relevant interest,
fees and other amounts owing under the Credit Documents for any period in
respect of the Obligations at the current rate at which the Obligations bear
interest for such period pursuant to the Credit Documents shall be deemed to be
payment in satisfaction of the interest payment for the same period under the
Debenture.
7. The
Debenture shall not operate by way of merger of any of the Obligations and no
judgment recovered by the Agent or the Beneficiaries shall operate by way of
merger of or in any way affect the security of the Debenture which is in
addition to and not in substitution for any other security now or hereafter held
by the Agent or the Beneficiaries with respect to the Obligations.
8. Notwithstanding
the form and terms of the Debenture and the provisions of this Debenture Pledge
Agreement, (a) the Agent shall not claim or realize an amount under or in
respect of the Debenture in excess of the aggregate Obligations, from time to
time, of the Debtor to the Agent and the Beneficiaries and (b) the
provisions of this Debenture Pledge Agreement and the Debenture, in particular,
but without limitation, Sections 2.2 and 3.1 of the Debenture, are subject
to the provisions of the Guarantee and Credit Agreement relating to the subject
matter thereof. If there are any express conflicts or inconsistencies
between the terms of the Guarantee or Credit Agreement and the Debenture or this
Debenture Pledge Agreement, then the terms of the Guarantee or Credit Agreement
(as applicable) shall govern in all respects to the extent necessary eliminate
such express conflicts or inconsistencies.
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9. Upon
payment and satisfaction in full of the Obligations and cancellation in full of
the credit facilities established under the Credit Agreement when none of the
Beneficiaries has other credit facilities in favour of or obligation to provide
credit to the Borrower, the Agent shall, at the request of the Debtor, deliver
up the Debenture to the Debtor and shall, at the request and expense of the
Debtor, execute and deliver to the Debtor releases, discharges and such other
instruments as shall be required to effectively discharge the Charge (as defined
in the Debenture).
10. Time
shall be of the essence with regard to this Debenture Pledge
Agreement.
11. Capitalized
terms used herein without express definition shall have the same meanings
ascribed thereto as are set forth in the Guarantee and Credit Agreement (as
applicable).
12. This
Debenture Pledge Agreement shall enure to the benefit of and be binding upon the
Debtor, the Agent and the Beneficiaries and their respective successors and
permitted assigns.
13. The
parties hereto each hereby attorn and submit to the jurisdiction of the courts
of the Province of Alberta. For the purpose of all legal proceedings,
this Debenture Pledge Agreement shall be deemed to have been performed in the
Province of Alberta and the courts of the Province of Alberta shall have
jurisdiction to entertain any action arising under this Debenture Pledge
Agreement. Notwithstanding the foregoing, nothing herein shall be
construed nor operate to limit the right of either party hereto to commence
any action relating hereto
in any other jurisdiction, nor to limit the right of the courts of any other
jurisdiction to take jurisdiction over any action or matter relating
hereto.
14. This
Debenture Pledge Agreement shall be governed by and construed in accordance with
the laws in force in the Province of Alberta.
15. The
Debtor hereby waives the right to receive from the Agent or the Beneficiaries a
copy of any financing statement, financing change statement or other statement
or document filed or registered at any time in respect of this Debenture Pledge
Agreement or any verification statement or other statement or document issued by
any registry that confirms or evidences registration of or relates to this
Debenture Pledge Agreement.
16. [All
references in this Debenture Pledge Agreement to covenants of, actions and steps
by, or the performance of the terms and conditions hereof by the “Debtor” shall,
as the context requires, be and shall be construed as being by the partners of
· Partnership on
behalf of and in respect of such
partnership.] [Note: Insert Section 16, with appropriate
conforming changes, for a Debenture Pledge Agreement with a general partnership;
insert similar provisions, with additional conforming changes, for a Debenture
Pledge Agreement with a limited partnership, trust or other unincorporated
entity.]
17. [The
Beneficiaries acknowledge that the trustee or manager of the Debtor, as
applicable, is entering into this Debenture Pledge Agreement solely in its
capacity as trustee or as agent, as the case may be, on behalf of the Debtor and
the obligations of the Debtor hereunder shall not be personally binding upon the
trustee, the manager or any of the Unitholders of the Debtor and that any
recourse against the Debtor, the trustee or any Unitholder in any manner in
respect of any indebtedness, obligation or liability of the Debtor arising
hereunder or arising in connection herewith or from the matters to which this
Debenture Pledge Agreement relates, if any, including without limitation claims
based on negligence or otherwise tortious behaviour, shall be limited to, and
satisfied only out of the Trust Fund. For the purposes of this
Section 17, capitalized terms used previously in this Section and not otherwise
expressly defined herein shall have the meanings set forth in the amended and
restated trust indenture of the Debtor dated as of September 2, 2003 on the date
hereof.][ [Note: Insert Section 17, with appropriate conforming
changes, for a debenture pledge agreement from Baytex Energy
Trust.]
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IN WITNESS WHEREOF the Debtor
has executed this Debenture Pledge Agreement as of the date first above
written.
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· [INSERT NAME OF
RELEVANT MATERIAL SUBSIDIARY OR BAYTEX ENERGY TRUST]
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Per:
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Name:
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Title:
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Per:
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Name:
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Title:
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ACCEPTED
AS OF THE DATE FIRST ABOVE WRITTEN BY:
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THE
TORONTO-DOMINION BANK,
as
Agent
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Per:
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Name:
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Title:
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