EXHIBIT 10.Q
[XX XXXXXX LOGO]
CREDIT AGREEMENT
AMONG
EPN HOLDING COMPANY, L.P.,
THE LENDERS PARTY HERETO,
BANC ONE CAPITAL MARKETS, INC. AND WACHOVIA BANK, NATIONAL ASSOCIATION,
AS CO-SYNDICATION AGENTS
FLEET NATIONAL BANK AND FORTIS CAPITAL CORP.,
AS CO-DOCUMENTATION AGENTS
AND
JPMORGAN CHASE BANK,
AS ADMINISTRATIVE AGENT
DATED AS OF APRIL 8, 2002
----------
X.X. XXXXXX SECURITIES INC.
AS SOLE BOOK RUNNER AND LEAD ARRANGER
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TABLE OF CONTENTS
Page
ARTICLE I
DEFINITIONS
Section 1.1 Defined Terms...................................................................................7
Section 1.2 Other Definitional Provisions..................................................................27
ARTICLE II
AMOUNT AND TERMS OF LOANS
Section 2.1 Loans and Commitments..........................................................................28
Section 2.2 Repayment of Loans; Evidence of Debt...........................................................28
Section 2.3 Procedure for Borrowing........................................................................29
Section 2.4 Limitations on Loans...........................................................................31
Section 2.5 Commitment Fee.................................................................................31
Section 2.6 Termination or Reduction of Commitments........................................................31
ARTICLE III
LETTERS OF CREDIT
Section 3.1 Issuance of Letters of Credit..................................................................32
Section 3.2 Procedure for Issuance of Letters of Credit....................................................33
Section 3.3 Participations and Payments in Respect of the Letters of Credit................................33
Section 3.4 Fees, Commissions and Other Charges............................................................34
Section 3.5 Reimbursement Obligation of the Borrower.......................................................35
Section 3.6 Obligations Absolute...........................................................................35
Section 3.7 Letter of Credit Payments......................................................................36
Section 3.8 Applications...................................................................................36
ARTICLE IV
GENERAL PROVISIONS FOR LOANS
Section 4.1 Optional and Mandatory Prepayments.............................................................36
Section 4.2 Conversion and Continuation Options............................................................38
Section 4.3 Minimum Amounts of Tranches....................................................................39
Section 4.4 Interest Rates and Payment Dates...............................................................39
Section 4.5 Computation of Interest and Fees...............................................................39
Section 4.6 Inability to Determine Interest Rate...........................................................40
Section 4.7 Pro Rata Treatment and Payments................................................................40
Section 4.8 Illegality.....................................................................................41
Section 4.9 Requirements of Law............................................................................41
Section 4.10 Taxes..........................................................................................43
Section 4.11 Indemnity......................................................................................44
Section 4.12 Lenders Obligation to Mitigate.................................................................44
Section 4.13 Certain Permitted Transactions.................................................................44
Section 4.14 Acquisition; Disposition.......................................................................45
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ARTICLE V
REPRESENTATIONS AND WARRANTIES
Section 5.1 Financial Condition............................................................................46
Section 5.2 No Change......................................................................................46
Section 5.3 Existence; Compliance with Law.................................................................46
Section 5.4 Power; Authorization; Enforceable Obligations..................................................47
Section 5.5 No Legal Bar...................................................................................47
Section 5.6 No Material Litigation.........................................................................48
Section 5.7 No Default.....................................................................................48
Section 5.8 Ownership of Property; Liens...................................................................48
Section 5.9 Intellectual Property..........................................................................48
Section 5.10 No Burdensome Restrictions.....................................................................48
Section 5.11 Taxes..........................................................................................48
Section 5.12 Federal Regulations............................................................................49
Section 5.13 ERISA..........................................................................................49
Section 5.14 Investment Company Act; Other Regulations......................................................49
Section 5.15 Subsidiaries...................................................................................49
Section 5.16 Purpose of Loans, Letters of Credit............................................................49
Section 5.17 Environmental Matters..........................................................................49
Section 5.18 Accuracy and Completeness of Information.......................................................51
Section 5.19 Security Documents.............................................................................51
Section 5.20 Solvency.......................................................................................51
Section 5.21 Transaction....................................................................................51
Section 5.22 Insurance......................................................................................52
ARTICLE VI
CONDITIONS PRECEDENT
Section 6.1 Conditions to Initial Extensions of Credit.....................................................52
Section 6.2 Conditions to Each Extension of Credit.........................................................56
ARTICLE VII
AFFIRMATIVE COVENANTS
Section 7.1 Financial Statements...........................................................................57
Section 7.2 Certificates; Other Information................................................................58
Section 7.3 Payment of Obligations.........................................................................60
Section 7.4 Conduct of Business and Maintenance of Existence...............................................60
Section 7.5 Maintenance of Property; Insurance.............................................................60
Section 7.6 Inspection of Property; Books and Records; Discussions.........................................61
Section 7.7 Notices........................................................................................61
Section 7.8 Environmental Laws.............................................................................61
Section 7.9 Maintenance of Liens of the Security Documents.................................................62
Section 7.10 Pledge of After-Acquired Property..............................................................62
Section 7.11 Use of Proceeds................................................................................63
Section 7.12 Ownership of Subsidiaries......................................................................63
Section 7.13 Joint Venture Charters.........................................................................63
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ARTICLE VIII
NEGATIVE COVENANTS
Section 8.1 Financial Condition Covenants..................................................................64
Section 8.2 Limitation on Indebtedness.....................................................................64
Section 8.3 Limitation on Liens............................................................................65
Section 8.4 Limitation on Guarantee Obligations............................................................66
Section 8.5 Limitations on Fundamental Changes.............................................................66
Section 8.6 Limitation on Sale of Assets...................................................................66
Section 8.7 Limitation on Dividends........................................................................67
Section 8.8 Limitation on Investments, Loans and Advances..................................................67
Section 8.9 Limitation on Modifications of Certain Agreements..............................................68
Section 8.10 Limitation on Transactions with Affiliates.....................................................69
Section 8.11 Limitation on Sales and Leasebacks.............................................................69
Section 8.12 Limitation on Changes in Fiscal Year...........................................................69
Section 8.13 Limitation on Lines of Business................................................................69
Section 8.14 Governing Documents............................................................................69
Section 8.15 Compliance with ERISA..........................................................................70
Section 8.16 Limitation on Restrictions Affecting Subsidiaries..............................................70
Section 8.17 Creation of Subsidiaries.......................................................................70
Section 8.18 Hazardous Materials............................................................................70
Section 8.19 Holding Companies..............................................................................71
Section 8.20 No Voluntary Termination of Joint Venture Charters.............................................71
Section 8.21 Actions by Joint Ventures......................................................................71
Section 8.22 Hedging Transactions...........................................................................71
ARTICLE IX
EVENTS OF DEFAULT
ARTICLE X
THE ADMINISTRATIVE AGENT
Section 10.1 Appointment....................................................................................75
Section 10.2 Delegation of Duties...........................................................................75
Section 10.3 Exculpatory Provisions.........................................................................75
Section 10.4 Reliance by Administrative Agent...............................................................75
Section 10.5 Notice of Default..............................................................................76
Section 10.6 Non-Reliance on Administrative Agent and Other Lenders.........................................76
Section 10.7 Indemnification................................................................................77
Section 10.8 Administrative Agent in Its Individual Capacity................................................77
Section 10.9 Successor Administrative Agent.................................................................77
Section 10.10 Other Agents...................................................................................77
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ARTICLE XI
MISCELLANEOUS
Section 11.1 Amendments and Waivers.........................................................................78
Section 11.2 Notices........................................................................................78
Section 11.3 No Waiver; Cumulative Remedies.................................................................79
Section 11.4 Survival of Representations and Warranties.....................................................79
Section 11.5 Payment of Expenses and Taxes..................................................................79
Section 11.6 Successors and Assigns; Participations; Purchasing Lenders.....................................80
Section 11.7 Adjustments; Set-off...........................................................................83
Section 11.8 Counterparts...................................................................................84
Section 11.9 Severability...................................................................................84
Section 11.10 Integration....................................................................................84
Section 11.11 Usury Savings Clause...........................................................................84
Section 11.12 GOVERNING LAW..................................................................................85
Section 11.13 Submission To Jurisdiction; Waivers............................................................85
Section 11.14 Acknowledgements...............................................................................85
Section 11.15 Confidentiality................................................................................86
Section 11.16 WAIVERS OF JURY TRIAL..........................................................................86
Section 11.17 Releases.......................................................................................86
Section 11.18 Limitation on Recourse of Lenders..............................................................87
ANNEXES
Annex I Applicable Margin
SCHEDULES
Schedule I Term Loan Lenders, Commitments and Commitment Percentages
Schedule II Revolving Credit Lenders, Commitments and Commitment
Percentages
Schedule 5.6 Litigation
Schedule 5.15 Subsidiaries
Schedule 5.17 Environmental Matters
Schedule 5.22 Insurance
EXHIBITS
Exhibit A Form of Revolving Credit Note
Exhibit B Form of Term Note
Exhibit C Form of Borrower Pledge Agreement
Exhibit D Form of Borrower Security Agreement
Exhibit E Form of Parent Guarantee - General Partner
Exhibit F Form of Parent Guarantee - Limited Partner
Exhibit G Form of Parent Pledge Agreement
Exhibit H Form of Subsidiaries Guaranty
Exhibit I Form of Subsidiaries Security Agreement
Exhibit J From of Subsidiaries Pledge Agreement
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Exhibit K Form of Borrowing Certificate
Exhibit L Form of Assignment and Assumption
Exhibit M Form of Environmental Compliance Certificate
Exhibit N Projections
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CREDIT AGREEMENT, dated as of April 8, 2002, among EPN HOLDING COMPANY,
L.P., a Delaware limited partnership (the "Borrower"), each bank and other
financial institution from time to time party to this Agreement (the "Lenders"),
and JPMORGAN CHASE BANK, as administrative agent for the Lenders hereunder (in
such capacity, the "Administrative Agent").
WITNESSETH:
WHEREAS, certain Affiliates (as hereinafter defined) of the Borrower,
and the Sellers (as hereinafter defined), have entered into the Acquisition
Documents (as hereinafter defined) for the purchase by the Borrower (or its
Affiliates) of certain equity interests and assets owned by the Sellers or their
Subsidiaries (as hereinafter defined) for aggregate consideration of up to
$735,000,000 (including payments for acquired indebtedness) as more fully
provided therein (the "Acquisition");
WHEREAS, an equity contribution having a fair market value of
approximately $200,000,000 (but no less than $190,000,000) is to be paid or
otherwise effected contemporaneous with the consummation of the Acquisition by
EPN (as hereinafter defined) or its Subsidiaries on behalf of the Borrower (the
"Equity Contribution"), such Equity Contribution, together with the proceeds of
certain of the Loans (as hereinafter defined), being used to consummate the
Acquisition and to consist of payments of cash, issuance of certain securities
and transfer of certain assets by EPN or its Subsidiaries to the Sellers;
WHEREAS, the Borrower has requested that the Lenders make such Loans to
it, and the Lenders are prepared to make such Loans upon and subject to the
terms hereof.
NOW, THEREFORE, in consideration of the premises and the mutual
covenants contained herein, the parties hereto hereby agree as follows:
ARTICLE I
DEFINITIONS
Section 1.1 Defined Terms. As used in this Agreement, the following
terms shall have the following meanings:
"Acquired Business": as defined in Section 8.8(e).
"Acquisition": as defined in the Recitals hereto.
"Acquisition Documents": collectively, the Purchase, Sale and Merger
Agreement, by and between El Paso Tennessee Pipeline Co, as seller, and EPN, as
buyer, dated as of April 1, 2002, the Prince PSA and the Contribution Agreement,
by and between El Paso Field Services Holding Company, as seller, and EPN, as
buyer, dated as of April 1, 2002.
"Additional Term Loan": as defined in Section 2.1(b).
"Additional Term Loan Borrowing Date": April 16, 2002.
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"Additional Term Loan Commitment": as to any Term Loan Lender, the
obligation of such Term Loan Lender to make an Additional Term Loan hereunder in
an aggregate principal amount not to exceed the amount set forth opposite such
Term Loan Lender's name on Schedule I under the heading "Additional Term Loan
Commitment" or in any assignment and acceptance pursuant to which such Term Loan
Lender becomes a party hereto, as such amount shall be reduced in accordance
with the provisions of this Agreement.
"Administrative Agent": as defined in the introductory paragraph of
this Agreement.
"Administrative Questionnaire": an Administrative Questionnaire in a
form supplied by the Administrative Agent.
"Affiliate": as to any Person, any other Person (other than a
Subsidiary) which, directly or indirectly, is in control of, is controlled by,
or is under common control with, such Person. For purposes of this definition,
"control" of a Person means the power, directly or indirectly, either to (i)
vote 10% or more of the securities having ordinary voting power for the election
of directors (or similar authority) of such Person or (ii) direct or cause the
direction of the management and policies of such Person, whether by contract or
otherwise; provided, that any third Person which also beneficially owns 10% or
more of the securities having ordinary voting power for the election of
directors (or similar authority) of a Joint Venture or Subsidiary shall not be
deemed to be an Affiliate of the Borrower and its Subsidiaries or Joint Ventures
merely because of such common ownership.
"Agreement": this
Credit Agreement, as amended, supplemented or
otherwise modified from time to time.
"Alternate Base Rate": for any day, a rate per annum (rounded upwards,
if necessary, to the next 1/16 of 1%) equal to the greatest of (a) the Prime
Rate in effect on such day, (b) the Base CD Rate in effect on such day plus 1%
and (c) the Federal Funds Effective Rate in effect on such day plus 1/2 of 1%.
For purposes hereof: "Prime Rate" shall mean the rate of interest per annum
publicly announced from time to time by the Administrative Agent as its prime
rate in effect at its principal office in
New York City (each change in the
Prime Rate to be effective on the date such change is publicly announced); "Base
CD Rate" shall mean the sum of (a) the product of (i) the Three-Month Secondary
CD Rate and (ii) a fraction, the numerator of which is one and the denominator
of which is one minus the C/D Reserve Percentage and (b) the C/D Assessment
Rate; "Three-Month Secondary CD Rate" shall mean, for any day, the secondary
market rate for three-month certificates of deposit reported as being in effect
on such day (or, if such day shall not be a Business Day, the next preceding
Business Day) by the Board of Governors of the Federal Reserve System (the
"Board") through the public information telephone line of the Federal Reserve
Bank of
New York (which rate will, under the current practices of the Board, be
published in Federal Reserve Statistical Release H.15(519) during the week
following such day), or, if such rate shall not be so reported on such day or
such next preceding Business Day, the average of the secondary market quotations
for three-month certificates of deposit of major money center banks in
New York
City received at approximately 10:00 A.M.,
New York City time, on such day (or,
if such day shall not be a Business Day, on the next preceding Business Day) by
the Administrative Agent from three
New York City negotiable certificate of
deposit dealers of recognized standing selected by it; "C/D Assessment
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Rate" means for any day as applied to any Loan, the net annual assessment rate
(rounded upward to the nearest 1/100th of 1%) determined by JPMorgan to be
payable on such day to the Federal Deposit Insurance Corporation or any
successor ("FDIC") for FDIC insuring time deposits made in Dollars at offices of
JPMorgan in the United States; and "Federal Funds Effective Rate" shall mean,
for any day, the weighted average of the rates on overnight federal funds
transactions with members of the Federal Reserve System arranged by federal
funds brokers, as published on the next succeeding Business Day by the Federal
Reserve Bank of
New York, or, if such rate is not so published for any day which
is a Business Day, the average of the quotations for the day of such
transactions received by the Administrative Agent from three federal funds
brokers of recognized standing selected by it. If for any reason the
Administrative Agent shall have determined (which determination shall be
conclusive absent manifest error) that it is unable to ascertain the Base CD
Rate or the Federal Funds Effective Rate, or both, for any reason, including the
inability or failure of the Administrative Agent to obtain sufficient quotations
in accordance with the terms thereof, the Alternate Base Rate shall be
determined without regard to clause (b) or (c), or both, of the first sentence
of this definition, as appropriate, until the circumstances giving rise to such
inability no longer exist. Any change in the Alternate Base Rate due to a change
in the Prime Rate, the Three-Month Secondary CD Rate or the Federal Funds
Effective Rate shall be effective on the effective day of such change in the
Prime Rate, the Three-Month Secondary CD Rate or the Federal Funds Effective
Rate, respectively.
"Alternate Base Rate Loans": Loans the rate of interest applicable to
which is based upon the Alternate Base Rate.
"Applicable Commitment Percentage" as to any Revolving Credit Lender,
such Lender's Revolving Credit Commitment Percentage, and as to any Term Loan
Lender, such Lender's Term Loan Percentage.
"Applicable Lender": with respect to any borrowing of Revolving Credit
Loans, each Revolving Credit Lender, and with respect to any borrowing of Term
Loans, each Term Loan Lender.
"Applicable Margin": for each Type of Loan, the rate per annum
specified in Annex I attached hereto, which rate is based on the ratio of
Consolidated Total Indebtedness of the Borrower at such time to Consolidated
EBITDA for the most recently ended Calculation Period (the "Leverage Ratio").
The Applicable Margin for any date shall be determined by reference to the
Leverage Ratio as of the last day of the fiscal quarter most recently ended as
of such date and for the Calculation Period ended on such last day, and any
change (x) shall become effective upon the delivery to the Administrative Agent
of a certificate of a Responsible Officer of the Borrower (which certificate may
be delivered prior to delivery of the relevant financial statements or may be
incorporated in the certificate delivered pursuant to subsection 7.2(b)) with
respect to the financial statements to be delivered pursuant to Section 7.1 for
the most recently ended fiscal quarter (a) setting forth in reasonable detail
the calculation of the Leverage Ratio at the end of such fiscal quarter and (b)
stating that the signer has reviewed the terms of this Agreement and other Loan
Documents and has made, or caused to be made under his or her supervision, a
review in reasonable detail of the transactions and condition of the Borrower
and its Subsidiaries during the accounting period, and that the signer does not
have knowledge of the existence as at the date of such officers' certificate of
any Event of Default or Default, and
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(y) shall apply (i) in the case of the Alternate Base Rate Loans, to Alternate
Base Rate Loans outstanding on such delivery date or made on and after such
delivery date and (ii) in the case of the Eurodollar Loans, to Eurodollar Loans
made on and after such delivery date. It is understood that the foregoing
certificate of a Responsible Officer shall be permitted to be delivered prior
to, but in no event later than, the time of the actual delivery of the financial
statements required to be delivered pursuant to Section 7.1. Notwithstanding the
foregoing, at any time during which the Borrower has failed to deliver the
certificate referred to above in this definition as required under subsection
7.2(b) with respect to a fiscal quarter following the date the delivery thereof
is due, the Leverage Ratio shall be deemed, solely for the purposes of this
definition, to be greater than 5.0 to 1.0 until such time as Borrower shall
deliver such compliance certificate.
"Application": an application, in such form as the Issuing Bank may
specify, requesting the Issuing Bank to issue a Letter of Credit.
"Asset Sale": any Disposition of Property other than (a) Dispositions
permitted by Subsections 8.6(a) through (d), and (b) any Disposition which,
together with any related Disposition of Property, yields gross proceeds to the
Borrower or any of its Subsidiaries (valued at the initial amount thereof in the
case of non-cash proceeds consisting of notes or other debt securities and
valued at fair market value in the case of other non-cash proceeds) of less than
$1,000,000, provided, that the aggregate gross proceeds of Dispositions of
Property excluded from the definition of Asset Sale pursuant to this clause (b)
shall not exceed $5,000,000 in any fiscal year of the Borrower.
"Assignment and Assumption": an assignment and assumption entered into
by a Lender and an assignee (with the consent of any party whose consent is
required by Section 11.6), and accepted by the Administrative Agent, in the form
of Exhibit L or any other form approved by the Administrative Agent.
"Available Revolving Credit Commitment": as to any Revolving Credit
Lender at any time, an amount equal to the excess, if any, of (a) the amount of
such Revolving Credit Lender's Revolving Credit Commitment over (b) such
Revolving Credit Lender's Revolving Credit Exposure.
"Borrower": as defined in the introductory paragraph of this Agreement.
"Borrower Partners": collectively, the General Partner and the Limited
Partner.
"Borrower Pledge Agreement": the Pledge Agreement made by the Borrower
in favor of the Administrative Agent for the benefit of the Lenders,
substantially in the form of Exhibit C hereto, as the same may be amended,
supplemented or otherwise modified from time to time.
"Borrower Security Agreement": the Security Agreement made by the
Borrower in favor of the Administrative Agent for the benefit of the Lenders,
substantially in the form of Exhibit D hereto, as the same may be amended,
supplemented or otherwise modified from time to time.
"Borrowing Date": any Business Day or Working Day, as applicable,
specified in a notice pursuant to Section 2.3 or 3.2 as a date on which the
Borrower requests the Lenders to make Loans or the Issuing Bank to issue a
Letter of Credit hereunder.
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"Business": as defined in Section 5.17.
"Business Day": a day other than a Saturday, Sunday or other day on
which commercial banks in
New York City are authorized or required by law to
close.
"Calculation Period": each period of four consecutive fiscal quarters
of the Borrower.
"Capital Lease": any lease of property, real or personal, the
obligations of the lessee in respect of which are required in accordance with
GAAP to be capitalized on a balance sheet of the lessee.
"Cash Equivalents": (i) marketable direct obligations issued or
unconditionally guaranteed by the United States Government or issued by any
agency thereof and backed by the full faith and credit of the United States, in
each case maturing within one year from the date of acquisition thereof; (ii)
marketable direct obligations issued by any state of the United States of
America or any political subdivision of any such state or any public
instrumentality thereof maturing within one year from the date of acquisition
thereof and, at the time of acquisition, having the highest rating obtainable
from either S&P or Xxxxx'x; (iii) commercial paper maturing no more than one
year from the date of creation thereof and, at the time of acquisition, having
the highest rating obtainable from either S&P or Xxxxx'x; (iv) certificates of
deposit or banker's acceptances maturing within one year from the date of
acquisition thereof issued by (x) any Lender, (y) any commercial bank organized
under the laws of the United States of America or any state thereof or the
District of Columbia having combined capital and surplus of not less than
$250,000,000 or (z) any bank which has a short-term commercial paper rating
meeting the requirements of clause (iii) above (any such Lender or bank, a
"Qualifying Lender"); (v) eurodollar time deposits having a maturity of less
than one year purchased directly from any Lender (whether such deposit is with
such Lender or any other Lender hereunder) or issued by any Qualifying Lender;
and (vi) repurchase agreements and reverse repurchase agreements with a term of
not more than 14 days with any Qualifying Lender relating to marketable direct
obligations issued or unconditionally guaranteed by the United States.
"C/D Reserve Percentage": for any day as applied to any Alternate Base
Rate Loan, that percentage (expressed as a decimal) which is in effect on such
day, as prescribed by the Board of Governors of the Federal Reserve System (or
any successor) (the "Board"), for determining the maximum reserve requirement
for a Depositary Institution (as defined in Regulation D of the Board) in
respect of new non-personal time deposits in Dollars having a maturity of 30
days or more.
"Channel Pipeline": the natural gas gathering system and related
facilities and assets generally known as the Channel Pipeline System.
"Channel Recovery Event": A Recovery Event resulting from the rupture
of the Channel Pipeline in October, 2001.
"Class": when used in reference to any Loan or Borrowing, refers to
whether such Loan, or the Loans comprising such Borrowing, are Revolving Credit
Loans or Term Loans.
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"Closing Date": the date on which the conditions set forth in Section
6.1 are first satisfied or waived, which shall occur on or prior to April 8,
2002.
"Co-Documentation Agents": collectively, Fleet National Bank and Fortis
Capital Corp., each in its capacity as co-documentation agent for the Lenders
hereunder.
"Co-Syndication Agents": collectively, Banc One Capital Markets, Inc.
and Wachovia Bank, National Association, each in its capacity as co-syndication
agent for the Lenders hereunder.
"Code": the Internal Revenue Code of 1986, as amended from time to
time.
"Collateral": the "Collateral" as defined in the several Security
Documents.
"Commitment Fee": the commitment fees payable pursuant to Section 2.5.
"Commitments": for any Lender, such Lender's Revolving Credit
Commitment and Term Loan Commitment.
"Commonly Controlled Entity": an entity, whether or not incorporated,
which is under common control with the Borrower within the meaning of Section
4001 of ERISA or is part of a group which includes the Borrower and which is
treated as a single employer under Section 414 of the Code.
"Consolidated EBITDA": for any period and in accordance with Section
4.14, the Consolidated Net Income ((i) including earnings and losses from
discontinued operations, except to the extent that any such losses represent
reserves for losses attributable to the planned disposition of material assets,
(ii) excluding extraordinary gains, and gains and losses arising from the sale
of material assets, and (iii) including other non-recurring losses) for such
period, plus (x) the aggregate amount of cash distributions received by the
Borrower and its Subsidiaries (excluding Joint Ventures) from Joint Ventures
(other than cash proceeds funded from the refinancing of the original capital
investment by the Borrower and its Subsidiaries in Joint Ventures), and (y), to
the extent reflected as a charge in the statement of Consolidated Net Income for
such period, the sum of (a) interest expense, amortization of debt discount and
debt issuance costs (including the write-off of such costs in connection with
prepayments of debt) and commissions, discounts and other fees and charges
associated with standby letters of credit, (b) taxes measured by income accrued
as an expense during such period, (c) depreciation, depletion, and amortization
expense, and (d) non-cash compensation expense resulting from the accounting
treatment applied, in accordance with GAAP, to management's equity interest
minus the equity of the Borrower and its Subsidiaries (excluding Joint Ventures)
in the earnings of Joint Ventures; provided that Consolidated EBITDA shall
exclude any insurance proceeds relating to a Channel Recovery Event. For any
Calculation Period commencing prior to the Closing Date, Consolidated EBITDA
shall be calculated as if the Borrower and its Subsidiaries had acquired the
assets acquired pursuant to the Acquisition on the first day of such period and,
with respect to any portion of such period prior to the Closing Date, based on
the historical consolidated financial information of such assets (subject to pro
forma adjustments reasonably satisfactory to the Administrative Agent).
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"Consolidated Interest Expense": for any period, and in accordance with
Section 4.14, total cash interest expense (including that attributable to
Capital Leases) of the Borrower and its Subsidiaries (excluding Joint Ventures)
for such period with respect to all outstanding Indebtedness of the Borrower and
such Subsidiaries (including all commissions, discounts and other fees and
charges owed with respect to letters of credit and bankers' acceptance financing
and net costs under Hedge Agreements in respect of interest rates to the extent
such net costs are allocable to such period in accordance with GAAP); provided,
that for the Calculation Periods ending on June 30, 2002, September 30, 2002,
and December 31, 2002, Consolidated Interest Expense shall be deemed to equal
actual Consolidated Interest Expense for the full fiscal quarters of the
Borrower subsequent to the Closing Date multiplied by 4, 2, and 4/3
respectively.
"Consolidated Net Income": for any period, and in accordance with
Section 4.14, the net income or net loss of the Borrower and its consolidated
Subsidiaries (excluding Joint Ventures) for such period determined in accordance
with GAAP on a consolidated basis.
"Consolidated Net Worth": as of the date of determination, all items
which in conformity with GAAP would be included under shareholders' equity on a
consolidated balance sheet of the Borrower and its consolidated Subsidiaries at
such date.
"Consolidated Tangible Net Worth": as of the date of determination and
in accordance with Section 4.14, Consolidated Net Worth after deducting
therefrom the following:
(a) goodwill, including any amounts (however designated on the
balance sheet) representing the cost of acquisitions of Subsidiaries in
excess of underlying tangible assets;
(b) patents, trademarks, copyrights;
(c) leasehold improvements not recoverable at the expiration
of a lease; and
(d) deferred charges (including, but not limited to,
unamortized debt discount and expense, organization expenses and
experimental and development expenses, but excluding prepaid expenses).
"Consolidated Total Indebtedness": at any time and in accordance with
Section 4.14, all Indebtedness of the Borrower and its consolidated Subsidiaries
at such time.
"Contractual Obligation": as to any Person, any provision of any
security issued by such Person or of any agreement, instrument or other
undertaking to which such Person is a party or by which it or any of its
property is bound.
"Cover": when required by this Agreement for L/C Obligations, shall be
effected by paying to the Administrative Agent in immediately available funds,
to be held by the Administrative Agent in a collateral account maintained by the
Administrative Agent at its office specified in Section 11.2 and hereby
collaterally assigned as security to the Administrative Agent for the benefit of
the Issuing Bank and the Lenders, an amount equal to the maximum amount of each
applicable Letter of Credit available for drawing at any time. Such amount shall
be retained by the Administrative Agent in such collateral account until such
time as the applicable Letter of
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Credit shall have expired and the Reimbursement Obligations, if any, with
respect thereto shall have been fully satisfied.
"Default": any of the events specified in Article IX, whether or not
any requirement for the giving of notice, the lapse of time, or both, or any
other condition, has been satisfied.
"Disposition": with respect to any Property, any sale, lease,
assignment, conveyance, transfer, or other disposition thereof; and the terms
"Dispose" and "Disposed of" shall have correlative meanings.
"Dollars" and "$": dollars in lawful currency of the United States of
America.
"El Paso": El Paso Corporation, a Delaware corporation.
"Environmental Laws": any and all foreign, Federal, state, local or
municipal laws, rules, orders, regulations, statutes, ordinances, codes,
decrees, requirements of any Governmental Authority or other Requirements of Law
(including common law) regulating, relating to or imposing liability or
standards of conduct concerning protection of human health or the environment or
to emissions, discharges, releases or threatened releases of pollutants,
contaminants, chemicals, or industrial, toxic or hazardous substances or wastes
into the environment including, without limitation, ambient air, surface water,
ground water, or land, or otherwise relating to the manufacture, processing,
distribution, use, treatment, storage, disposal, transport, or handling of
pollutants, contaminants, chemicals, or industrial, toxic or hazardous
substances or wastes, as now or may at any time hereafter be in effect.
"EPEPC": El Paso Energy Partners Company (formerly known as Leviathan
Gas Pipeline Company), a Delaware corporation.
"EPGT Texas Pipeline": EPGT Texas Pipeline, L.P., a Delaware limited
partnership.
"EPN": El Paso Energy Partners, L.P., a Delaware limited partnership.
"EPN
Credit Agreement": The Fifth Amended and Restated
Credit
Agreement, dated as of March 23, 1995, as amended and restated through May 16,
2001, among EPN, El Paso Energy Partners Finance Corporation, the several banks
and other financial institutions from time to time parties thereto, and JPMorgan
(formerly known as The Chase Manhattan Bank), as administrative agent, as
further amended by the First Amendment and the Second Amendment and as further
amended, supplemented or otherwise modified from time to time.
"EPN Gathering and Treating": EPN Gathering and Treating Company, L.P.,
a Delaware limited partnership.
"EPN Gathering and Treating GP Holding": EPN Gathering and Treating GP
Holding, L.L.C., a Delaware limited liability company.
"Equity Contribution": as defined in the Recitals hereto.
14
"Equity Interests": shares of capital stock, partnership interests,
membership interests in a limited liability company, beneficial interests in a
trust or other equity ownership interests in a Person, and any warrants, options
or other rights entitling the holder thereof to purchase or acquire any such
equity interest.
"ERISA": the Employee Retirement Income Security Act of 1974, as
amended from time to time.
"Eurocurrency Reserve Requirements": for any day as applied to a
Eurodollar Loan, the aggregate (without duplication) of the rates (expressed as
a decimal) of reserve requirements in effect on such day (including, without
limitation, basic, supplemental, marginal and emergency reserves under any
regulations of the Board of Governors of the Federal Reserve System or other
Governmental Authority having jurisdiction with respect thereto) dealing with
reserve requirements prescribed for eurocurrency funding (currently referred to
as "Eurocurrency Liabilities" in Regulation D of such Board) maintained by a
member bank of such System.
"Eurodollar Base Rate": with respect to each day during each Interest
Period pertaining to a Eurodollar Loan, the rate appearing on page 3750 of the
Telerate Service (or on any successor or substitute page of such Service, or any
successor to or substitute for such Service, providing rate quotations
comparable to those currently provided on such page of such Service, as
determined by the Administrative Agent from time to time for purposes of
providing quotations of interest rates applicable to dollar deposits in the
London interbank market) at approximately 11:00 A.M., London time, two Working
Days prior to the beginning of such Interest Period, as the rate for dollar
deposits with a maturity comparable to such Interest Period. In the event that
such rate is not available at such time for any reason, then the "Eurodollar
Base Rate" with respect to such Eurodollar Loans for such Interest Period shall
be the rate at which dollar deposits of a comparable amount to such Eurodollar
Loans and for a maturity comparable to such Interest Period are offered by the
principal London office of the Administrative Agent in immediately available
funds in the London interbank market at approximately 11:00 A.M., London time,
two Working Days prior to the commencement of such Interest Period.
"Eurodollar Loans": Loans the rate of interest applicable to which is
based upon the Eurodollar Rate.
"Eurodollar Rate": with respect to each day during each Interest Period
pertaining to a Eurodollar Loan, a rate per annum determined for such day in
accordance with the following formula (rounded upward to the nearest 1/100th of
1%):
Eurodollar Base Rate
1.00 - Eurocurrency Reserve Requirements
"Event of Default": any of the events specified in Article IX, provided
that any requirement for the giving of notice, the lapse of time, or both, or
any other condition, has been satisfied.
"Expiry Date": with respect to any Letter of Credit at any time, the
then stated expiration date of such Letter of Credit as set forth in such Letter
of Credit.
15
"Federal Funds Effective Rate": as defined in the definition of
Alternate Base Rate.
"First Amendment": The First Amendment, dated as of October 10, 2001,
to the EPN
Credit Agreement.
"Foreign Lender": any Lender that is organized under the laws of a
jurisdiction other than that in which the Borrower is located. For purposes of
this definition, the United States of America, each State thereof and the
District of Columbia shall be deemed to constitute a single jurisdiction.
"GAAP": generally accepted accounting principles in the United States
of America in effect from time to time.
"General Partner": EPN GP Holding, L.L.C., a Delaware limited liability
company, or any other Person acting as general partner of the Borrower.
"Governmental Authority": any nation or government, any state or other
political subdivision thereof and any entity exercising executive, legislative,
judicial, regulatory or administrative functions of or pertaining to government.
"Guarantee Obligation": as to any Person (the "guaranteeing person"),
any obligation of (a) the guaranteeing person or (b) another Person (including,
without limitation, any bank under any letter of credit) to induce the creation
of which the guaranteeing person has issued a reimbursement, counterindemnity or
similar obligation, in either case guaranteeing or in effect guaranteeing any
Indebtedness, leases, dividends or other obligations (the "primary obligations")
of any other third Person (the "primary obligor") in any manner, whether
directly or indirectly, including, without limitation, any obligation of the
guaranteeing person, whether or not contingent, (i) to purchase any such primary
obligation or any property constituting direct or indirect security therefor,
(ii) to advance or supply funds (1) for the purchase or payment of any such
primary obligation or (2) to maintain working capital or equity capital of the
primary obligor or otherwise to maintain the net worth or solvency of the
primary obligor, (iii) to purchase property, securities or services primarily
for the purpose of assuring the owner of any such primary obligation of the
ability of the primary obligor to make payment of such primary obligation or
(iv) otherwise to assure or hold harmless the owner of any such primary
obligation against loss in respect thereof; provided, however, that the term
Guarantee Obligation shall not include endorsements of instruments for deposit
or collection in the ordinary course of business. The amount of any Guarantee
Obligation of any guaranteeing person shall be deemed to be the lower of (a) an
amount equal to the stated or determinable amount of the primary obligation in
respect of which such Guarantee Obligation is made and (b) the maximum amount
for which such guaranteeing person may be liable pursuant to the terms of the
instrument embodying such Guarantee Obligation, unless such primary obligation
and the maximum amount for which such guaranteeing person may be liable are not
stated or determinable, in which case the amount of such Guarantee Obligation
shall be such guaranteeing person's maximum reasonably anticipated liability in
respect thereof as determined by the Borrower in good faith.
"Guarantees": collectively, the Parent Guarantees and the Subsidiaries
Guarantee.
16
"Hazardous Materials": any hazardous materials, hazardous wastes,
hazardous constituents, hazardous or toxic substances, petroleum products
(including crude oil or any fraction thereof), defined or regulated as such in
or under any Environmental Law.
"Hedge Agreements": all interest rate swaps, caps or collar agreements
or similar arrangements dealing with interest rates or currency exchange rates
or the exchange of nominal interest obligations, either generally or under
specific contingencies.
"Hub Services": El Paso Hub Services Company, L.L.C., a Delaware
limited liability company.
"Indebtedness": of any Person at any date, (a) all indebtedness of such
Person for borrowed money or for the deferred purchase price of property or
services (other than current trade liabilities incurred in the ordinary course
of business and payable in accordance with customary practices and which in any
event are no more than 120 days past due or, if more than 120 days past due, are
being contested in good faith and adequate reserves with respect thereto have
been made on the books, of such Person), (b) any other indebtedness of such
Person which is evidenced by a note, bond, debenture or similar instrument, (c)
all obligations of such Person under Capital Leases, (d) all obligations of such
Person in respect of outstanding letters of credit (other than commercial
letters of credit with an initial maturity date of less than 90 days),
acceptances and similar obligations issued or created for the account of such
Person, (e) all liabilities secured by any Lien on any property owned by such
Person even though such Person has not assumed or otherwise become liable for
the payment thereof and (f) for purposes of the covenants set forth in Section
8.1, the net obligations of such Person under Hedge Agreements.
"Indian Basin": El Paso Indian Basin, L.P., a Delaware limited
partnership.
"Indian Basin GP": El Paso Indian Basin GP, L.L.C., a Delaware limited
liability company.
"Indian Basin Indebtedness": Existing Indebtedness of Indian Basin owed
by Indian Basin to El Paso, in an aggregate principal amount of $119,000,000,
for which Indian Basin is to remain liable immediately after the Acquisition.
"Initial Term Loan": as defined in Section 2.1(b).
"Initial Term Loan Commitment": as to any Term Loan Lender, the
obligation of such Term Loan Lender to make an Initial Term Loan hereunder in an
aggregate principal amount not to exceed the amount set forth opposite such Term
Loan Lender's name on Schedule I under the heading "Initial Term Loan
Commitment" or in any assignment and acceptance pursuant to which such Term Loan
Lender becomes a party hereto, as such amount shall be reduced in accordance
with the provisions of this Agreement.
"Insolvency": with respect to any Multiemployer Plan, the condition
that such Plan is insolvent within the meaning of Section 4245 of ERISA.
"Insolvent": pertaining to a condition of Insolvency.
17
"Interest Payment Date": (a) as to any Alternate Base Rate Loan, the
Quarterly Dates, commencing on June 30, 2002, (b) as to any Eurodollar Loan
having an Interest Period of three months or less, the last day of such Interest
Period, and (c) as to any Eurodollar Loan having an Interest Period longer than
three months, each day which is three months or a whole multiple thereof, after
the first day of such Interest Period and the last day of such Interest Period.
"Interest Period": with respect to any Eurodollar Loan:
(a) initially, the period commencing on the Borrowing Date or
conversion date, as the case may be, with respect to such Eurodollar
Loan and ending fourteen days (if available) or one, two, three or six
months thereafter, as selected by the Borrower in its notice of
borrowing or notice of conversion, as the case may be, given with
respect thereto; and
(b) thereafter, each period commencing on the last day of the
next preceding Interest Period applicable to such Eurodollar Loan and
ending fourteen days (if available) or one, two, three or six months
thereafter, as selected by the Borrower by irrevocable notice to the
Administrative Agent not less than three Working Days prior to the last
day of the then current Interest Period with respect thereto;
provided that, all of the foregoing provisions relating to Interest
Periods are subject to the following:
(1) if any Interest Period pertaining to a Eurodollar Loan
would otherwise end on a day that is not a Working Day, such Interest
Period shall be extended to the next succeeding Working Day unless the
result of such extension would be to carry such Interest Period into
another calendar month in which event such Interest Period shall end on
the immediately preceding Working Day;
(2) any Interest Period that would otherwise extend beyond the
Revolving Credit Termination Date or the Term Loan Maturity Date, as
applicable, shall end on the Revolving Credit Termination Date or the
Term Loan Maturity Date, as applicable;
(3) any Interest Period pertaining to a Eurodollar Loan that
begins on the last Working Day of a calendar month (or on a day for
which there is no numerically corresponding day in the calendar month
at the end of such Interest Period) shall end on the last Working Day
of a calendar month; and
(4) the Borrower shall select Interest Periods so as not to
require a payment or prepayment of any Eurodollar Loan during an
Interest Period for such Loan.
"Intrastate": El Paso Energy Intrastate, L.P., a Delaware limited
partnership.
"Issuing Bank": JPMorgan, in its capacity as issuer of any Letter of
Credit hereunder. The Issuing Bank may, in its discretion, arrange for one or
more Letters of Credit to be issued by Affiliates of the Issuing Bank, in which
case the term "Issuing Bank" shall include any such Affiliate with respect to
Letters of Credit issued by such Affiliate.
18
"Joint Venture": any Person in which the Borrower and/or its
Subsidiaries hold more than 5% but less than a majority of the equity interests,
and which does not constitute a Subsidiary of the Borrower, whether direct or
indirect.
"Joint Venture Charter": with respect to each Joint Venture, the
partnership agreement, certificate of incorporation, by-laws, limited liability
company agreement or other constitutive documents of such Joint Venture, as each
of the same may be further amended, supplemented or otherwise modified in
accordance with Section 8.9.
"JPMorgan": JPMorgan Chase Bank.
"L/C Commitment Amount": $10,000,000.
"L/C Commitment Percentage": as to any L/C Participant at any time, the
percentage determined under paragraph (a) of the definition of "Revolving Credit
Commitment Percentage" in this Section 1.1.
"L/C Disbursement": a payment made by the Issuing Bank pursuant to a
Letter of Credit.
"L/C Obligations": at any time, an amount equal to the sum of (a) the
aggregate then undrawn and unexpired amount of the Letters of Credit and (b) the
aggregate amount of drawings under the Letters of Credit which have not then
been reimbursed pursuant to subsection 3.5(a).
"L/C Participants": the collective reference to all Lenders with
Revolving Credit Commitments (other than the Issuing Bank).
"Lenders": as defined in the opening paragraph of this Agreement.
"Letters of Credit": as defined in subsection 3.1(a).
"Leverage Ratio": as defined in the definition of "Applicable Margin".
"Lien": any mortgage, pledge, hypothecation, assignment, deposit
arrangement, encumbrance, lien (statutory or other), charge or other security
interest or any preference, priority, preferential arrangement or other security
agreement of any kind or nature whatsoever (including, without limitation, any
conditional sale or other title retention agreement and any Capital Lease having
substantially the same economic effect as any of the foregoing).
"Limited Partner": EPN Holding Company I, L.P., a Delaware limited
partnership, or any other Person acting as limited partner of the Borrower.
"Loan": a Revolving Credit Loan or a Term Loan and "Loans" shall mean
collectively the Revolving Credit Loans or the Term Loans or one or more of them
as provided herein.
"Loan Documents": this Agreement, the Notes, the Guarantees, the
Security Documents, and the Applications.
19
"Loan Parties": the Borrower, the General Partner, the Limited Partner,
the Subsidiary Guarantors and each other Affiliate of the Borrower that from
time to time is party to a Loan Document.
"Material Adverse Effect": a material adverse effect on (a) the
business, operations, property, condition (financial or otherwise) or prospects
of the Borrower and its Subsidiaries taken as a whole, (b) the ability of any
Loan Party to perform its obligations under this Agreement or any of the other
Loan Documents or (c) the validity or enforceability of this Agreement or any of
the other Loan Documents or the rights or remedies of the Administrative Agent
or the Lenders hereunder or thereunder.
"Material Environmental Amount": an amount payable by the Borrower
and/or its Subsidiaries in excess of $1,000,000 for remedial costs, compliance
costs, compensatory damages, punitive damages, fines, penalties or any
combination thereof.
"Materials of Environmental Concern": any gasoline or petroleum
(including crude oil or any fraction thereof) or petroleum products or any
hazardous or toxic substances, materials or wastes, defined or regulated as such
in or under any Environmental Law, including, without limitation, asbestos,
polychlorinated biphenyls and urea-formaldehyde insulation.
"MIAGS": Matagorda Island Area Gathering System, a Texas joint venture.
"Multiemployer Plan": a Plan which is a multiemployer plan as defined
in Section 4001(a)(3) of ERISA.
"Net Proceeds": (a) in connection with any Asset Sale, Purchase Price
Adjustment or Recovery Event, the proceeds thereof in the form of Cash
Equivalents (including any such proceeds received by way of deferred payment of
principal pursuant to a note or installment receivable or purchase price
adjustment receivable or otherwise, but only as and when received) of such Asset
Sale, Purchase Price Adjustment or Recovery Event, net of any applicable fees,
expenses or other similar payment obligations, including, without limitation,
any attorneys' fees, accountants' fees, investment banking fees, survey costs,
title insurance premiums, amounts required to be applied to the repayment of the
Indebtedness secured by a Lien expressly permitted hereunder on any asset which
is the subject of such Asset Sale, Purchase Price Adjustment or Recovery Event
(other than any Lien pursuant to a Security Document) and other customary fees
and expenses actually incurred in connection therewith, net of taxes paid or
reasonably estimated to be payable as a result thereof (after taking into
account any available tax credits or deductions and any tax sharing
arrangements) and that of purchase price adjustments reasonably expected to be
payable by the Borrower or Subsidiaries of the Borrower in connection therewith,
and (b) in connection with any issuance or sale of equity securities or debt
securities or instruments or the incurrence of loans, the cash proceeds from
such issuance or incurrence, net of any applicable fees, expenses or other
similar payment obligations, including, without limitation, attorneys' fees,
investment banking fees, accountants' fees, underwriting discounts and
commissions and other customary fees and expenses actually incurred (including
amounts payable) in connection therewith.
"Notes": the Revolving Credit Notes and the Term Notes.
20
"Obligations": the unpaid principal of and interest on (including
interest accruing after the maturity of the Loans and reimbursement obligations
in respect of Letters of Credit and interest accruing after the filing of any
petition in bankruptcy, or the commencement of any insolvency, reorganization or
like proceeding, relating to the Borrower, whether or not a claim for
post-filing or post-petition interest is allowed in such proceeding) the Loans
and all other obligations and liabilities of the Borrower to the Administrative
Agent or to any Lender (or, in the case of Hedge Agreements, any affiliate of
any Lender), whether direct or indirect, absolute or contingent, due or to
become due, or now existing or hereafter incurred, which may arise under, out
of, or in connection with, this Agreement, any other Loan Document, the Letters
of Credit, any Hedge Agreement entered into with any Lender or any affiliate of
any Lender or any other document made, delivered or given in connection herewith
or therewith, whether on account of principal, interest, reimbursement
obligations, fees, indemnities, costs, expenses (including all fees, charges and
disbursements of counsel to the Administrative Agent or to any Lender that are
required to be paid by the Borrower pursuant hereto) or otherwise.
"Offshore Gathering & Transmission": El Paso Offshore Gathering &
Transmission, L.L.C., a Delaware limited liability company.
"Parent Guarantees": collectively, the Parent Guarantee made by the
General Partner in favor of the Administrative Agent, for the benefit of the
Lenders, substantially in the form of Exhibit E hereto, and the Parent Guarantee
made by the Limited Partner in favor of the Administrative Agent, for the
benefit of the Lenders, substantially in the form of Exhibit F hereto, as each
may be amended, supplemented or otherwise modified from time to time.
"Parent Pledge Agreement": the Pledge Agreement made by the General
Partner and the Limited Partner in favor of the Administrative Agent for the
benefit of the Lenders, substantially in the form of Exhibit G hereto, as the
same may be amended, supplemented or otherwise modified from time to time.
"Participants": as defined in subsection 11.6(c).
"Partnership Agreement": the Agreement of Limited Partnership of the
Borrower among the partners of the Borrower effective as of March 7, 2002 and as
in effect on the Closing Date, as amended, modified and supplemented from time
to time in accordance with Section 8.9.
"PBGC": the Pension Benefit Guaranty Corporation established pursuant
to Subtitle A of Title IV of ERISA.
"Person": an individual, partnership, corporation, limited liability
company, business trust, joint stock company, trust, unincorporated association,
joint venture, Governmental Authority or other entity of whatever nature (the
term "Person" shall not be deemed to include, however, any joint tenancy or
tenancy-in-common pursuant to which any property or assets may be owned in an
undivided interest).
"Pipeline GP Holding": EPN Pipeline GP Holding, L.L.C., a Delaware
limited liability company.
21
"Plan": at a particular time, any employee benefit plan which is
covered by ERISA and in respect of which the Borrower or a Commonly Controlled
Entity is (or, if such plan were terminated at such time, would under Section
4069 of ERISA be deemed to be) an "employer" as defined in Section 3(5) of
ERISA.
"Pledge Agreements": collectively, the Borrower Pledge Agreement, the
Parent Pledge Agreement, the Subsidiary Pledge Agreement and any other pledge
agreement executed and delivered pursuant to Section 8.17.
"Prince PSA": the Purchase and Sale Agreement, by and between EPN, as
seller, and El Paso Production GOM Inc., as buyer, dated as of April 1, 2002.
"Projections": the projections which were prepared by or on behalf of
the Borrower in connection with the Transaction and delivered to the
Administrative Agent and the Lenders prior to the Closing Date and attached
hereto as Exhibit N.
"Properties": the facilities and properties owned, leased or operated
by the Borrower or any of its Subsidiaries or any Joint Venture.
"Property": any interest in any kind of property or asset, whether
real, personal or mixed, or tangible or intangible.
"Purchase Price Adjustment": the amount by which the aggregate
consideration paid to the Sellers on the Closing Date is adjusted by an amount
equal to the net of (i) total Purchase Price Decreases or Issue Price Decreases
(as such terms are defined in the Acquisition Documents, other than the Prince
PSA), as the case may be, and (ii) total Purchase Price Increases or Issue Price
Increases (as such terms are defined in the Acquisition Documents, other than
the Prince PSA), as the case may be, as determined as of 7:00 a.m. (Central
time) on April 1, 2002.
"Quarterly Dates": the last day of each March, June, September and
December in each year.
"Recovery Event": any settlement of or payment in respect of any
property insurance or casualty insurance claim or any condemnation proceeding
relating to any Property of the Borrower or any of its Subsidiaries, excluding
any such settlement or payment which, together with any related settlement or
payment, yields gross proceeds to the Borrower or any of its Subsidiaries of
less than $1,000,000.
"Register": as defined in Section 11.6(b)(iv).
"Regulation U": Regulation U of the Board of Governors of the Federal
Reserve System as in effect from time to time.
"Reimbursement Obligation": the obligation of the Borrower to reimburse
the Issuing Bank pursuant to subsection 3.5(a) for amounts drawn under the
Letters of Credit.
22
"Reinvestment Deferred Amount": with respect to any Reinvestment Event,
the aggregate Net Proceeds received by the Borrower or any of its Subsidiaries
in connection therewith which are not applied to prepay the Term Loans pursuant
to Section 4.1(c)(i) as a result of the delivery of a Reinvestment Notice.
"Reinvestment Event": any Asset Sale or Recovery Event in respect of
which the Borrower has delivered a Reinvestment Notice.
"Reinvestment Notice": written notice executed by a Responsible Officer
stating that no Event of Default has occurred and is continuing and that the
Borrower (directly or indirectly through a Subsidiary) intends and expects to
use all or a specified portion of the Net Proceeds of an Asset Sale or Recovery
Event to acquire or construct assets useful in its business.
"Reinvestment Prepayment Amount": with respect to any Reinvestment
Event, the Reinvestment Deferred Amount relating thereto less any amount
expended prior to the relevant Reinvestment Prepayment Date to directly or
indirectly acquire (by purchase, construction, lease or otherwise) assets in any
business of the Borrower or its Subsidiaries permitted by Section 8.13.
"Reinvestment Prepayment Date": with respect to any Reinvestment
Prepayment Amount relating to any Reinvestment Event, the earlier of (a) the
date occurring nine months after the Reinvestment Event and (b) the date on
which the Borrower shall have determined not to, or shall have otherwise ceased
to, acquire (by purchase, construction, lease or otherwise) assets in any
business of the Borrower or its Subsidiaries permitted by Section 8.13 with all
or any portion of the relevant Reimbursement Deferred Amount.
"Related Parties": with respect to any specified Person, such Person's
Affiliates and the respective directors, officers, employees, agents and
advisors of such Person and such Person's Affiliates.
"Reorganization": with respect to any Multiemployer Plan, the condition
that such plan is in reorganization within the meaning of Section 4241 of ERISA.
"Reorganization Transactions": as defined in Section 4.13.
"Reportable Event": any of the events set forth in Section 4043(b) of
ERISA, other than those events as to which the thirty day notice period is
waived under subsections .13, .14, .16, .18, .19 or .20 of PBGC Reg. Section
2615.
"Required Lenders": at any time, Lenders the Total Credit Percentages
of which aggregate at least 51%.
"Requirement of Law": as to any Person, the Certificate of
Incorporation and By-Laws or other organizational or governing documents of such
Person, and any law, treaty, rule or regulation or determination of an
arbitrator or a court or other Governmental Authority, in each case applicable
to or binding upon such Person or any of its property or to which such Person or
any of its property is subject.
23
"Responsible Officer": the Chief Executive Officer, the Chief Operating
Officer, the President, the Chief Financial Officer, the Treasurer or any vice
president of the General Partner or the Borrower.
"Restricted Payment": as defined in Section 8.7.
"Restricted Subsidiaries": as defined in the EPN
Credit Agreement.
"Revolving Credit Commitment": as to any Revolving Credit Lender, the
obligation of such Revolving Credit Lender to make Revolving Credit Loans to
and/or issue or participate in Letters of Credit issued on behalf of the
Borrower hereunder in an aggregate principal and/or face amount at any one time
outstanding not to exceed the amount set forth opposite such Revolving Credit
Lender's name on Schedule II under the heading "Revolving Credit Commitment" or
in any assignment and acceptance pursuant to which such Revolving Credit Lender
becomes a party hereto, as such amount may be reduced from time to time in
accordance with the provisions of this Agreement.
"Revolving Credit Commitment Percentage": as to any Lender at any time,
with respect to any credit to be extended under, payment or prepayment to be
made under, conversion or continuation under, participation in a Letter of
Credit issued under, or other matter with respect to, the Revolving Credit
Commitments, (a) a percentage, the numerator of which is such Lender's Revolving
Credit Commitment and the denominator of which is the aggregate Revolving Credit
Commitments then in effect or (b) if the Revolving Credit Commitments have been
terminated, as to any Lender at any time, a percentage, the numerator of which
is such Lender's Revolving Credit Exposure and the denominator of which is the
Revolving Credit Exposure of all Lenders at such time.
"Revolving Credit Commitment Period": the period from and including the
date hereof to but not including the Revolving Credit Termination Date or such
earlier date on which the Revolving Credit Commitments shall terminate as
provided herein.
"Revolving Credit Exposure": as to any Revolving Credit Lender at any
time, an amount equal to the sum of (a) the aggregate principal amount of all
Revolving Credit Loans made by such Lender then outstanding and (b) such
Lender's L/C Obligations then outstanding.
"Revolving Credit Lender": any Lender having a Revolving Credit
Commitment or Revolving Credit Exposure hereunder.
"Revolving Credit Loans": as defined in Section 2.1(a).
"Revolving Credit Note": as defined in subsection 2.2(e).
"Revolving Credit Termination Date": the third anniversary of the
Closing Date, and any other date on which the Revolving Credit Commitments are
terminated.
"Second Amendment": The Second Amendment, dated as of March 28, 2002,
to the EPN
Credit Agreement.
24
"Security Agreements": collectively, the Borrower Security Agreement
and the Subsidiary Security Agreement.
"Security Documents": collectively, the Pledge Agreements and the
Security Agreements.
"Sellers": collectively, El Paso Tennessee Pipeline Co, a Delaware
corporation, and El Paso Field Services Holding Company, a Delaware corporation.
"Single Employer Plan": any Plan which is covered by Title IV of ERISA,
but which is not a Multiemployer Plan.
"Solvent": with respect to any Person on a particular date, the
condition that, on such date, (a) the fair value of the Property of such Person
is greater than the total amount of liabilities, including, without limitation,
contingent liabilities, of such Person, (b) the present fair salable value of
the assets of such Person is not less than the amount that will be required to
pay the probable liability of such Person on its debts as they become absolute
and matured, (c) such Person does not intend to, and does not believe that it
will, incur debts or liabilities beyond such Person's ability to pay as such
debts and liabilities mature, and (d) such Person is not engaged in business or
a transaction, and is not about to engage in business or a transaction, for
which such Person's Property would constitute an unreasonably small amount of
capital. In computing the amount of contingent liabilities at any time, such
liabilities will be computed at the amount which, in light of all the facts and
circumstances existing at such time, represents the amount that can reasonably
be expected to become an actual or matured liability.
"Subsidiaries Guarantee": the Subsidiaries Guarantee made by the
Subsidiary Guarantors in favor of the Administrative Agent, for the benefit of
the Lenders, substantially in the form of Exhibit H hereto, as the same may be
amended, supplemented or otherwise modified from time to time.
"Subsidiary": as to any Person (solely for purposes of this definition,
the "Owning Person"), a corporation, partnership or other Person (solely for
purposes of this definition, the "Owned Person") of which shares of stock or
other ownership interests having ordinary voting power (other than stock or such
other ownership interests having such power only by reason of the happening of a
contingency) to elect a majority of the board of directors or other managers of
the Owned Person are at the time owned, or the management of which is otherwise
controlled, directly or indirectly through one or more intermediaries, or both,
by such Owning Person. Unless otherwise qualified, all references to a
"Subsidiary" or to "Subsidiaries" in this Agreement shall refer to a Subsidiary
or Subsidiaries of the Borrower.
"Subsidiary Guarantors": collectively, Intrastate, Pipeline GP Holding,
EPGT Texas Pipeline, Hub Services, Warwink I, Warwink II, Warwink Gathering and
Treating, Offshore Gathering and Transmission, Indian Basin GP, Indian Basin,
EPN Gathering and Treating GP Holding, EPN Gathering and Treating, and each
other Subsidiary of the Borrower which, from time to time, may become party to
the Subsidiaries Guarantee.
"Subsidiary Pledge Agreement": the Pledge Agreement made by each of the
Subsidiary Guarantors in favor of the Administrative Agent for the benefit of
the Lenders, substantially in
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the form of Exhibit J hereto, as the same may be amended, supplemented or
otherwise modified from time to time.
"Subsidiary Security Agreement": the Security Agreement made by each of
the Subsidiary Guarantors (including any security agreement executed and
delivered pursuant to Section 8.17) in favor of the Administrative Agent for the
benefit of the Lenders, substantially in the form of Exhibit I hereto, as the
same may be amended, supplemented or otherwise modified from time to time.
"Term Loan" as defined in Section 2.1(b).
"Term Loan Commitment": as to any Term Loan Lender, such Term Loan
Lender's aggregate Initial Term Loan Commitment and Additional Term Loan
Commitment.
"Term Loan Lender": any Lender having a Term Loan Commitment hereunder
and/or a Term Loan outstanding hereunder.
"Term Loan Maturity Date": the third anniversary of the Closing Date.
"Term Loan Percentage": as to any Term Loan Lender, (a) on the Closing
Date, the percentage which such Term Loan Lender's Term Loan Commitment then
outstanding constitutes of the aggregate Term Loan Commitments then outstanding
or, (b) at any time after the Closing Date, the percentage which such Lender's
Term Loans then outstanding constitutes of the aggregate Term Loans then
outstanding.
"Term Note": as defined in Section 2.2(e).
"Termination Date": the later of (i) the Revolving Credit Termination
Date and (ii) the Term Loan Maturity Date.
"Total Credit Percentage": as to any Lender at any time, the percentage
of the aggregate Revolving Credit Commitments and aggregate Term Loan
Commitments then constituted by such Lender's Revolving Credit Commitment and
Term Loan Commitment (it being agreed that upon termination or expiration of the
Revolving Credit Commitments, or, as to the Term Loan Commitments, after the
Closing Date, the Total Credit Percentage of any Lenders shall be determined,
(i) in the case of the termination or expiration of the Revolving Credit
Commitments, by reference to the Revolving Credit Exposure of the Revolving
Credit Lenders and such Lender's Revolving Credit Exposure; and (ii) as to the
Term Loans, by reference to the aggregate principal amount of the Term Loans and
if prior to the Additional Term Loan Borrowing Date, of the Term Loan
Commitments of the Term Loan Lenders, and the aggregate principal amount of such
Lender's Term Loans and if prior to the Additional Term Loan Borrowing Date, of
its Term Loan Commitment).
"Tranche": the collective reference to Eurodollar Loans the Interest
Periods with respect to all of which begin on the same date and end on the same
later date (whether or not such Revolving Credit Loans shall originally have
been made on the same day).
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"Transaction": collectively, (i) the Acquisition, (ii) the Equity
Contribution, (iii) the entering into of the Loan Documents and the incurrence
of the Loans on the Closing Date and (iv) the payment of fees and expenses owing
in connection with the foregoing.
"Transaction Documents": the Loan Documents and the Acquisition
Documents.
"Transferee": any (i) Participant or (ii) assignee of this Agreement
pursuant to Section 11.6(b).
"Type": as to any Loan, its nature as an Alternate Base Rate Loan or a
Eurodollar Loan.
"Uniform Customs": the Uniform Customs and Practice for Documentary
Credits (1993 Revision), International Chamber of Commerce Publication No. 500,
as the same may be amended from time to time.
"Warwink I": El Paso Energy Warwink I Company, L.L.C., a Delaware
limited liability company.
"Warwink II": El Paso Energy Warwink II Company, L.L.C., a Delaware
limited liability company.
"Warwink Gathering and Treating": Warwink Gathering and Treating
Company, a Texas general partnership.
"Working Day": any Business Day on which dealings in foreign currencies
and exchange between banks may be carried on in London, England.
Section 1.2 Other Definitional Provisions.
(a) Unless otherwise specified therein, all terms defined in
this Agreement shall have the defined meanings when used in the Notes or any
certificate or other document made or delivered pursuant hereto.
(b) The definitions of terms herein shall apply equally to the
singular and plural forms of the terms defined. Whenever the context may
require, any pronoun shall include the corresponding masculine, feminine and
neuter forms. The words "include", "includes" and "including" shall be deemed to
be followed by the phrase "without limitation". The word "will" shall be
construed to have the same meaning and effect as the word "shall". Unless the
context requires otherwise (i) any definition of or reference to any agreement,
instrument or other document herein shall be construed as referring to such
agreement, instrument or other document as from time to time amended,
supplemented or otherwise modified (subject to any restrictions on such
amendments, supplements or modifications set forth herein), (ii) any reference
herein to any Person shall be construed to include such Person's successors and
assigns (subject to any restrictions on assignments set forth herein), (iii) the
words "herein", "hereof" and "hereunder", and words of similar import, shall be
construed to refer to this Agreement in its entirety and not to any particular
provision hereof, and (iv) all references herein to Articles, Sections,
Exhibits, Annexes and Schedules shall be construed to refer to Articles and
Sections of, and Exhibits, Annexes and Schedules to, this Agreement.
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(c) Except as otherwise expressly provided herein, all terms
of an accounting or financial nature shall be construed in accordance with GAAP,
as in effect from time to time; provided that, if the Borrower notifies the
Administrative Agent that the Borrower requests an amendment to any provision
hereof to eliminate the effect of any change occurring after the date hereof in
GAAP or in the application thereof on the operation of such provision (or if the
Administrative Agent notifies the Borrower that the Required Lenders request an
amendment to any provision hereof for such purpose), regardless of whether any
such notice is given before or after such change in GAAP or in the application
thereof, then such provision shall be interpreted on the basis of GAAP as in
effect and applied immediately before such change shall have become effective
until such notice shall have been withdrawn or such provision amended in
accordance herewith.
ARTICLE II
AMOUNT AND TERMS OF LOANS
Section 2.1 Loans and Commitments.
(a) Subject to the terms and conditions hereof, each Revolving
Credit Lender severally agrees to make revolving credit loans (the "Revolving
Credit Loans") to the Borrower from time to time during the Revolving Credit
Commitment Period in an aggregate principal amount at any one time outstanding
which, when added to such Lender's Revolving Credit Commitment Percentage of the
then outstanding L/C Obligations, does not exceed the amount of such Lender's
Revolving Credit Commitment, provided that no such Revolving Credit Loan shall
be made if, after giving effect thereto, Section 2.4 would be contravened.
During the Revolving Credit Commitment Period the Borrower may use the Revolving
Credit Commitments by borrowing, prepaying the Revolving Credit Loans in whole
or in part, and reborrowing, all in accordance with the terms and conditions
hereof.
(b) Subject to the terms and conditions hereof, each Term Loan
Lender severally agrees to make, (i) on the Closing Date, a term loan (the
"Initial Term Loan") to the Borrower in an aggregate principal amount not to
exceed its Initial Term Loan Commitment, and (ii) on a date occurring after the
Closing Date but on or prior to the Additional Term Loan Borrowing Date, a term
loan (the "Additional Term Loan") to the Borrower in an aggregate principal
amount not to exceed its Additional Term Loan Commitment (Initial Term Loans and
Additional Term Loans, collectively, the "Term Loans"). Once repaid, Term Loans
may not be reborrowed.
(c) The Loans may from time to time be (i) Eurodollar Loans,
(ii) Alternate Base Rate Loans or (iii) a combination thereof, as determined by
the Borrower and notified to the Administrative Agent in accordance with
Sections 2.3 and 4.2, provided that no Loan shall be made as a Eurodollar Loan
after the day that is one month prior to the Revolving Credit Termination Date
or Term Loan Maturity Date, as applicable.
Section 2.2 Repayment of Loans; Evidence of Debt.
(a) The Borrower hereby unconditionally promises to pay to the
Administrative Agent for the account of each (i) Revolving Credit Lender the
then unpaid
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principal amount of each Revolving Credit Loan on the Revolving Credit
Termination Date, and (ii) Term Loan Lender the then unpaid principal amount of
each Term Loan on the Term Loan Maturity Date.
(b) Each Lender shall maintain in accordance with its usual
practice an account or accounts evidencing the indebtedness of the Borrower to
such Lender resulting from each Loan made by such Lender, including the amounts
of principal and interest payable and paid to such Lender from time to time
hereunder.
(c) The Administrative Agent shall maintain accounts in which
it shall record (i) the amount of each Loan made hereunder, the Type thereof,
whether such Loan is a Term Loan or a Revolving Credit Loan, and the Interest
Period applicable thereto, (ii) the amount of any principal or interest due and
payable or to become due and payable from the Borrower to each Lender hereunder
and (iii) the amount of any sum received by the Administrative Agent hereunder
for the account of the Lenders and each Lender's share thereof.
(d) The entries made in the accounts maintained pursuant to
paragraph (b) or (c) of this Section 2.2 shall be prima facie evidence of the
existence and amounts of the obligations recorded therein; provided that the
failure of any Lender or the Administrative Agent to maintain such accounts or
any error therein shall not in any manner affect the obligation of the Borrower
to repay the Loans in accordance with the terms of this Agreement.
(e) Any Lender may request that Revolving Credit Loans or Term
Loans made by it be evidenced by a promissory note. In such event, the Borrower
shall prepare, execute and deliver to such Lender a promissory note
substantially in the form of Exhibit A hereto (a "Revolving Credit Note"), or a
promissory note substantially in the form of Exhibit B hereto (a "Term Note"),
as applicable, payable to the order of such Lender (or, if requested by such
Lender, to such Lender and its registered assigns). Thereafter, the Loans
evidenced by any such promissory note and interest thereon shall at all times
(including after assignment pursuant to Section 11.6) be represented by one or
more promissory notes in such form payable to the order of the payee named
therein (or, if such promissory note is a registered note, to such payee and its
registered assigns).
Section 2.3 Procedure for Borrowing.
(a) The Borrower may borrow under the Revolving Credit
Commitments during the Revolving Credit Commitment Period on any Working Day, if
all or any part of the requested Revolving Credit Loans are to be initially
Eurodollar Loans, or on any Business Day, otherwise, provided that the Borrower
shall give the Administrative Agent irrevocable notice (which notice must be
received by the Administrative Agent prior to 10:00 A.M.,
New York City time,
(a) three Working Days prior to the requested Borrowing Date, if all or any part
of the requested Revolving Credit Loans are to be initially Eurodollar Loans, or
(b) one Business Day prior to the requested Borrowing Date, otherwise),
specifying (i) the amount to be borrowed, (ii) the requested Borrowing Date,
(iii) whether the borrowing is to be of Eurodollar Loans, Alternate Base Rate
Loans or a combination thereof, and (iv) if the borrowing is to be entirely or
partly of Eurodollar Loans, the respective amounts of such Type of Revolving
Credit Loan and the respective lengths of the initial Interest Periods therefor.
Each borrowing under the
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Revolving Credit Commitments shall be in an amount equal to (x) in the case of
Alternate Base Rate Loans, $500,000 or a whole multiple thereof (or, if the then
Available Revolving Credit Commitments are less than $500,000, such lesser
amount) and (y) in the case of Eurodollar Loans, $1,000,000 or a whole multiple
of $100,000 in excess thereof. Upon receipt of any such notice from the
Borrower, the Administrative Agent shall promptly notify each Revolving Credit
Lender thereof. Each Revolving Credit Lender will make the amount of its pro
rata share of each borrowing available to the Administrative Agent for the
account of the Borrower at the office of the Administrative Agent specified in
Section 11.2 prior to 11:00 A.M.,
New York City time, on the Borrowing Date
requested by the Borrower in funds immediately available to the Administrative
Agent. Such borrowing will then be made available to the Borrower by the
Administrative Agent crediting the account of the Borrower on the books of such
office with the aggregate of the amounts made available to the Administrative
Agent by the Revolving Credit Lenders and in like funds as received by the
Administrative Agent.
(b) The Borrower may borrow under the Initial Term Loan
Commitments on the Closing Date, provided that the Borrower shall give the
Administrative Agent irrevocable notice (which notice must be received by the
Administrative Agent prior to 10:00 A.M.,
New York City time, on the Closing
Date), specifying (i) the amount to be borrowed, (ii) that such Initial Term
Loans shall be incurred on the Closing Date, and (iii) that such borrowing is to
be of Alternate Base Rate Loans. Upon receipt of any such notice from the
Borrower, the Administrative Agent shall promptly notify each Term Loan Lender
thereof. Each Term Loan Lender will make the amount of its pro rata share of
each borrowing available to the Administrative Agent for the account of the
Borrower at the office of the Administrative Agent specified in Section 11.2
prior to 2:00 P.M., New York City time, on the Closing Date in funds immediately
available to the Administrative Agent. Such borrowing will then be made
available to the Borrower by the Administrative Agent crediting the account of
the Borrower on the books of such office with the aggregate of the amounts made
available to the Administrative Agent by the Term Loan Lenders and in like funds
as received by the Administrative Agent.
(c) The Borrower may borrow under the Additional Term Loan
Commitments on any date after the Closing Date but on or prior to the Additional
Term Loan Borrowing Date, provided that the Borrower shall give the
Administrative Agent irrevocable notice (which notice must be received by the
Administrative Agent prior to 10:00 A.M., New York City time, (a) three Working
Days prior to the requested Borrowing Date, if all or any part of the requested
Additional Term Loans are to be initially Eurodollar Loans, or (b) one Business
Day prior to the requested Borrowing Date, otherwise), specifying (i) the amount
to be borrowed, (ii) the requested Borrowing Date, (iii) whether the borrowing
is to be of Eurodollar Loans, Alternate Base Rate Loans or a combination
thereof, and (iv) if the borrowing is to be entirely or partly of Eurodollar
Loans, the respective amounts of such Type of Additional Term Loan and the
respective lengths of the initial Interest Period therefor. Upon receipt of any
such notice from the Borrower, the Administrative Agent shall promptly notify
each Term Loan Lender thereof. Each Term Loan Lender will make the amount of its
pro rata share of each borrowing available to the Administrative Agent for the
account of the Borrower at the office of the Administrative Agent specified in
Section 11.2 prior to 11:00 A.M., New York City time, on the Borrowing Date
requested by the Borrower in funds immediately available to the Administrative
Agent. Such borrowing will then be made available to the Borrower by the
Administrative Agent crediting the account of the Borrower on the books of such
office with the aggregate of the
30
amounts made available to the Administrative Agent by the Term Loan Lenders and
in like funds as received by the Administrative Agent.
Section 2.4 Limitations on Loans. No requested Revolving Credit Loan
shall be made if the aggregate Revolving Credit Exposure (after giving effect to
such requested Revolving Credit Loan) would exceed the then aggregate Revolving
Credit Commitments. No requested Term Loan shall be made, if the aggregate
amount of the Term Loans outstanding (after giving effect to such requested Term
Loan) would exceed the then aggregate Term Loan Commitments.
Section 2.5 Commitment Fee. The Borrower agrees to pay to the
Administrative Agent the following:
(a) for the account of each Revolving Credit Lender a
commitment fee for the period from and including the date hereof to the
Revolving Credit Termination Date, computed at the rate per annum equal to 0.50%
on the average daily amount of the Available Revolving Credit Commitment of such
Lender, during the period for which payment is made, payable quarterly in
arrears on each Quarterly Date, commencing on June 30, 2002, and on the
Revolving Credit Termination Date or such earlier date as the Revolving Credit
Commitments shall terminate as provided herein, commencing on the first of such
dates to occur after the date hereof ; and
(b) for the account of each Term Loan Lender a commitment fee
for the period from and including the date hereof to the Additional Term Loan
Borrowing Date (or such earlier date as the aggregate Additional Term Loan
Commitments shall be reduced to zero or terminated pursuant to the terms of this
Agreement), computed at the rate per annum equal to 0.50% on the average daily
amount of the Additional Term Loan Commitment of such Lender, during the period
for which payment is made, payable in arrears on the Additional Term Loan
Borrowing Date or such earlier date as the Additional Term Loan Commitments
shall terminate pursuant to the terms of this Agreement.
Section 2.6 Termination or Reduction of Commitments.
(a) The Borrower shall have the right, upon not less than five
Business Days' notice to the Administrative Agent, to terminate the Revolving
Credit Commitments or, from time to time, to reduce the amount of the Revolving
Credit Commitments, provided that no such termination or reduction shall be
permitted if, after giving effect thereto and to any prepayments of the
Revolving Credit Loans made on the effective date thereof, the aggregate
principal amount of the Revolving Credit Loans then outstanding, when added to
the then outstanding L/C Obligations, would exceed the Revolving Credit
Commitments then in effect. Any such reduction shall be in an amount equal to
$1,000,000 or a whole multiple thereof.
(b) Any reduction of Revolving Credit Commitments pursuant to
subsection 2.6(a) or 4.1(d) shall reduce permanently the Revolving Credit
Commitments then in effect.
(c) Any or all of the Initial Term Loan Commitments remaining
unused shall automatically terminate at 5:00 p.m. (New York City time) on the
Closing Date.
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(d) Any or all of the Additional Term Loan Commitments
remaining unused shall automatically terminate at 5:00 p.m. (New York City time)
on the Additional Term Loan Borrowing Date or on such earlier date as any
Additional Term Loans are funded.
ARTICLE III
LETTERS OF CREDIT
Section 3.1 Issuance of Letters of Credit.
(a) Subject to the terms and conditions hereof, the Issuing
Bank, in reliance on the agreements of the other Revolving Credit Lenders set
forth in subsection 3.3(a), agrees to issue letters of credit (the "Letters of
Credit") for the account of the Borrower on any Business Day during the
Revolving Credit Commitment Period in such form as may be approved from time to
time by the Issuing Bank; provided that the Issuing Bank shall have no
obligation to issue any Letter of Credit if, after giving effect to such
issuance, (1) the L/C Obligations would exceed the L/C Commitment or (2) the
Available Revolving Credit Commitment would be less than zero or (3) the
aggregate Revolving Credit Exposure would exceed the then aggregate Revolving
Credit Commitments.
(b) Each Letter of Credit shall:
(i) be denominated in Dollars and shall be either (A)
a standby letter of credit issued to support obligations of the Borrower or any
Subsidiary of the Borrower, contingent or otherwise, in connection with the
working capital and business needs of the Borrower or such Subsidiary of the
Borrower, as the case may be, in the ordinary course of business, or (B) a
commercial letter of credit issued in respect of the purchase of goods or
services by the Borrower or any Subsidiary of the Borrower in the ordinary
course of business; and
(ii) expire no later than the earlier of (A) one year
after the date of issuance or renewal thereof in accordance with the term of
such Letter of Credit; provided that any Letter of Credit with an expiry date
occurring one year after its issuance may be renewed for additional one-year
periods and (B) five Business Days prior to the Revolving Credit Termination
Date.
(c) Each Letter of Credit shall be subject to the Uniform
Customs and, to the extent not inconsistent therewith, the laws of the State of
New York.
(d) The Issuing Bank shall not at any time be obligated to
issue any Letter of Credit hereunder if such issuance would conflict with, or
cause the Issuing Bank or any L/C Participant to exceed any limits imposed by,
any applicable Requirement of Law.
Section 3.2 Procedure for Issuance of Letters of Credit. The Borrower
may from time to time request that the Issuing Bank issue a Letter of Credit by
delivering to the Issuing Bank at its address for notices specified herein an
Application therefor, completed to the satisfaction of the Issuing Bank, and
such other certificates, documents and other papers and information as the
Issuing Bank may reasonably request. Upon receipt of any Application, the
Issuing Bank will process such Application and the certificates, documents and
other papers and information
32
delivered to it in connection therewith in accordance with its customary
procedures and shall promptly issue the Letter of Credit requested thereby (but
in no event shall the Issuing Bank be required to issue any Letter of Credit
earlier than three Business Days after its receipt of the Application therefor
and all such other certificates, documents and other papers and information
relating thereto) by issuing the original of such Letter of Credit to the
beneficiary thereof or as otherwise may be agreed by the Issuing Bank and the
Borrower. The Issuing Bank shall furnish a copy of such Letter of Credit to the
Borrower promptly following the issuance thereof.
Section 3.3 Participations and Payments in Respect of the Letters of
Credit.
(a) The Issuing Bank irrevocably agrees to grant and hereby
grants to each L/C Participant, and, to induce the Issuing Bank to issue Letters
of Credit hereunder, each L/C Participant irrevocably agrees to accept and
purchase and hereby accepts and purchases from the Issuing Bank, on the terms
and conditions hereinafter stated, for such L/C Participant's own account and
risk an undivided interest equal to such L/C Participant's L/C Commitment
Percentage in the Issuing Bank's obligations and rights under each Letter of
Credit issued hereunder and the amount of each draft paid by the Issuing Bank
thereunder.
(b) Each L/C Participant unconditionally and irrevocably
agrees with the Issuing Bank that, if a draft is paid under any Letter of Credit
for which the Issuing Bank is not reimbursed on the day of such payment in full
by the Borrower in immediately available funds, such Revolving Credit Lender
shall pay to the Issuing Bank upon demand at the Issuing Bank's address for
notices specified herein an amount equal to such L/C Participant's L/C
Commitment Percentage of the amount of such draft, or any part thereof, which is
not so reimbursed. Each L/C Participant's obligation to make each such payment
to the Issuing Bank, and the Issuing Bank's right to receive the same, are
absolute and unconditional and shall not be affected by any circumstance
whatsoever, including, without limiting the effect of the foregoing, the
occurrence or continuance of a Default or Event of Default or the failure of any
other L/C Participant to make any payment under this Section 3.3, and each L/C
Participant further agrees that each such payment shall be made without any
offset, abatement, withholding or reduction whatsoever. Each L/C Participant
shall indemnify and hold harmless the Issuing Bank from and against any and all
losses, liabilities (including, without limitation, liabilities for penalties),
actions, suits, judgments, demands, costs and expenses (including reasonable
attorneys' fees) resulting from any failure of such L/C Participant to provide,
or from any delay in providing, the Issuing Bank with such L/C Participant's L/C
Commitment Percentage of such payment in accordance with the provisions of this
Section 3.3, but no L/C Participant shall be so liable for any such failure on
the part of any other L/C Participant.
(c) If any amount required to be paid by any L/C Participant
to the Issuing Bank pursuant to subsection 3.3(a) in respect of any unreimbursed
portion of any payment made by the Issuing Bank under any Letter of Credit is
paid to the Issuing Bank within two Business Days after the date such payment is
due, such L/C Participant shall pay to the Issuing Bank on demand an amount
equal to the product of (i) such amount, times (ii) the daily average Federal
funds rate, as quoted by the Issuing Bank, during the period from and including
the date such payment is required to the date on which such payment is
immediately available to the Issuing Bank, times (iii) a fraction the numerator
of which is the number of days that elapse during such period and the
denominator of which is 360. If any such amount required to be paid by any L/C
33
Participant pursuant to subsection 3.3(a) is not in fact made available to the
Issuing Bank by such L/C Participant within two Business Days after the date
such payment is due, the Issuing Bank shall be entitled to recover from such L/C
Participant, on demand, such amount with interest thereon calculated from such
due date at the rate per annum applicable to Alternate Base Rate Loans
hereunder. A certificate of the Issuing Bank submitted to any L/C Participant
with respect to any amounts owing under this Section 3.3 shall be conclusive in
the absence of manifest error.
(d) Whenever, at any time after the Issuing Bank has made
payment under any Letter of Credit and has received from any L/C Participant its
pro rata share of such payment in accordance with subsection 3.3(a), the Issuing
Bank receives any payment related to such Letter of Credit (whether directly
from the Borrower or otherwise, including proceeds of collateral applied thereto
by the Issuing Bank), or any payment of interest on account thereof, the Issuing
Bank will distribute to such L/C Participant its pro rata share thereof;
provided, however, that in the event that any such payment received by the
Issuing Bank shall be required to be returned by the Issuing Bank, such L/C
Participant shall return to the Issuing Bank the portion thereof previously
distributed by the Issuing Bank to it.
Section 3.4 Fees, Commissions and Other Charges.
(a) The Borrower shall pay to the Administrative Agent, for
the account of the Issuing Bank, a fronting fee with respect to each Letter of
Credit for the period from and including the date of issuance thereof to but not
including the Expiry Date thereof, computed at the rate of 1/8 of 1% per annum
on the average daily amount of the undrawn and unexpired amount of such Letter
of Credit. Such fronting fee shall be payable quarterly in advance on the date
of issuance of each Letter of Credit and on the Quarterly Dates thereafter,
commencing on June 30, 2002. Such fee shall be nonrefundable.
(b) The Borrower shall pay to the Administrative Agent, for
the account of the Issuing Bank and the L/C Participants, a letter of credit
commission with respect to each Letter of Credit for the period from and
including the date of issuance thereof to but not including the Expiry Date
thereof, computed at the rate of the then Applicable Margin for Eurodollar Loans
per annum on the average daily amount of the undrawn and unexpired amount of
such Letter of Credit. Such commission shall be payable to the L/C Participants
to be shared ratably among them in accordance with their respective L/C
Commitment Percentages. Such commission shall be payable quarterly in advance on
the date of issuance of each Letter of Credit and on the Quarterly Dates
thereafter, commencing on June 30, 2002. Such fee shall be nonrefundable.
(c) In addition to the foregoing fees and commissions, the
Borrower shall pay or reimburse the Issuing Bank for such normal and customary
costs and expenses as are incurred or charged by the Issuing Bank in issuing,
effecting payment under, amending or otherwise administering any Letter of
Credit.
(d) The Administrative Agent shall, promptly following its
receipt thereof, distribute to the Issuing Bank and the L/C Participants all
fees and commissions received by the Administrative Agent for their respective
accounts pursuant to this Section 3.4.
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(e) The fees and commissions described in the preceding
paragraphs (a) and (b) shall be based on a 360 day year. If any amounts in the
preceding paragraphs (a) and (b) shall be payable on a day that is not a Working
Day, such amount shall be extended to the next succeeding Working Day unless the
result of such extension would be to carry such amount into another calendar
month in which event such amount shall be payable on the immediately preceding
Working Day.
Section 3.5 Reimbursement Obligation of the Borrower.
(a) The Borrower agrees to reimburse the Issuing Bank on each
date on which the Issuing Bank notifies the Borrower of the date and amount of a
draft presented under any Letter of Credit and paid by the Issuing Bank for the
amount of (i) such draft so paid and (ii) any taxes, fees, charges or other
costs or expenses incurred by the Issuing Bank in connection with such payment.
Each such payment shall be made to the Issuing Bank at its address for notices
specified herein in lawful money of the United States of America and in
immediately available funds.
(b) Unless otherwise notified by the Borrower, each drawing
under a Letter of Credit shall constitute a request by the Borrower to the
Administrative Agent for a borrowing pursuant to Section 2.3 of Revolving Credit
Loans which are Alternate Base Rate Loans in the amount of such drawing, subject
to satisfaction of the conditions set forth in Section 6.2. The Borrowing Date
with respect to such borrowing shall be the date of such drawing.
(c) Interest shall be payable on any and all amounts remaining
unpaid by the Borrower under this Section 3.5 from the date such amounts become
payable (whether at stated maturity, by acceleration or otherwise) until payment
in full at the rate which would be payable on any outstanding Alternate Base
Rate Loans which were then overdue.
Section 3.6 Obligations Absolute.
(a) The Borrower's obligations under this Article III shall be
absolute and unconditional under any and all circumstances and irrespective of
any set-off, counterclaim or defense to payment which the Borrower may have or
have had against the Issuing Bank or any beneficiary of any Letter of Credit.
(b) The Borrower also agrees with the Issuing Bank that the
Issuing Bank shall not be responsible for, and the Borrower's Reimbursement
Obligations under subsection 3.5(a) shall not be affected by, among other
things, (i) the validity or genuineness of documents or of any endorsements
thereon, even though such documents shall in fact prove to be invalid,
fraudulent or forged, or (ii) any dispute between or among the Borrower and any
beneficiary of any Letter of Credit or any other party to which such Letter of
Credit may be transferred or (iii) any claims whatsoever of the Borrower against
any beneficiary of any Letter of Credit or any such transferee.
(c) The Issuing Bank shall not be liable for any error,
omission, interruption or delay in transmission, dispatch or delivery of any
message or advice, however transmitted, in connection with any Letter of Credit,
except for errors or omissions caused by the Issuing Bank's gross negligence or
willful misconduct.
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(d) The Borrower agrees that any action taken or omitted by
the Issuing Bank under or in connection with any Letter of Credit or the related
drafts or documents, if done in the absence of gross negligence of willful
misconduct and in accordance with the standards of care specified in the Uniform
Commercial Code of the State of New York, shall be binding on the Borrower and
shall not result in any liability of the Issuing Bank to the Borrower.
Section 3.7 Letter of Credit Payments. If any draft shall be presented
for payment under any Letter of Credit, the Issuing Bank shall promptly notify
the Borrower of the date and amount thereof. The responsibility of the Issuing
Bank to the Borrower in connection with any draft presented for payment under
any Letter of Credit shall, in addition to any payment obligation expressly
provided for in such Letter of Credit, be limited to determining that the
documents (including each draft) delivered under such Letter of Credit in
connection with such presentment are in conformity with such Letter of Credit.
Section 3.8 Applications. To the extent that any provision of any
Application related to any Letter of Credit is inconsistent with the provisions
of this Article III, the provisions of this Article III shall apply.
ARTICLE IV
GENERAL PROVISIONS FOR LOANS
Section 4.1 Optional and Mandatory Prepayments.
(a) The Borrower may on the last day of any Interest Period
with respect thereto, in the case of Eurodollar Loans, or at any time and from
time to time, in the case of Alternate Base Rate Loans, prepay the Revolving
Credit Loans, the Term Loans, or both, in whole or in part, without premium or
penalty, upon at least four Business Days' irrevocable notice to the
Administrative Agent, specifying (i) the date and amount of prepayment, (ii)
whether the prepayment is of Eurodollar Loans, Alternate Base Rate Loans or a
combination thereof, and, if of a combination thereof, the amount allocable to
each, and (iii) whether the prepayment is of Revolving Credit Loans, Term Loans,
or a combination thereof, and, if of a combination thereof, the amount allocable
to each. Upon receipt of any such notice the Administrative Agent shall promptly
notify each Applicable Lender thereof. If any such notice is given, the amount
specified in such notice shall be due and payable on the date specified therein,
with accrued interest to such date on the amount prepaid in the case of
prepayment of the Term Loans. Partial prepayments (x) of Revolving Credit Loans
shall be in an aggregate principal amount of $1,000,000 or a whole multiple
thereof, and (y) of Term Loans shall be in an aggregate principal amount of
$5,000,000 or a whole multiple of $1,000,000 in excess thereof.
(b) If on any date (including any date on which a certificate
of a Responsible Officer of the Borrower is delivered pursuant to subsection
7.2(b)) the sum of the aggregate Revolving Credit Exposure then outstanding
exceeds the then aggregate Revolving Credit Commitments, then, without notice or
demand, the Borrower shall promptly prepay the Revolving Credit Loans in an
amount equal to such excess.
(c) (i) At any time the Borrower or any Subsidiary of the
Borrower shall receive Net Proceeds from a Recovery Event (excluding a Channel
Recovery Event) or Asset
36
Sale then, unless a Reinvestment Notice shall be delivered in respect thereof,
the Borrower shall repay the Loans within 5 Business Days after the date such
proceeds were received in an amount equal to 100% of such Net Proceeds as
provided in Section 4.1(d), provided, that notwithstanding the foregoing, on
each Reinvestment Prepayment Date, the Borrower shall repay the Loans within 5
Business Days after such date in an amount equal to the Reinvestment Prepayment
Amount with respect to the relevant Recovery Event or Asset Sale as provided in
Section 4.1(d).
(ii) At any time after the Closing Date that EPN or any of its
Restricted Subsidiaries shall receive Net Proceeds from any issuance or sale of
Equity Interests or debt securities issued pursuant to existing or future EPN
indentures by EPN or any of its Restricted Subsidiaries, the Borrower shall
repay the Loans within 5 Business Days after the date such proceeds were
received in an amount equal to 100% of such Net Proceeds as provided in Section
4.1(d), provided, that the prepayment of the Loans shall not be required (x) so
long as on the most recent Quarterly Date the Leverage Ratio for the Calculation
Period ending on such date was less than 4.00:1.00 or (y) as provided in Section
4.1(e).
(iii) At any time the General Partner, the Limited Partner,
the Borrower or any Subsidiary of the Borrower shall receive Net Proceeds from
any Purchase Price Adjustment, the Borrower shall repay the Loans within 5
Business Days after the date such proceeds were received in an amount equal to
100% of such Net Proceeds as provided in Section 4.1(d).
(d) (i) Amounts of any prepayments made in accordance with
Section 4.1(b) or (c) shall be applied (A) first, toward the repayment of Term
Loans then outstanding and (B) second, to the extent in excess thereof, as a
permanent reduction to the Revolving Credit Commitments in accordance with
Section 2.6(b), and (C) third, after payment in full of the Revolving Credit
Loans and Reimbursement Obligations outstanding, as Cover for the L/C
Obligations in an amount of such remaining excess.
(ii) The application of any prepayment pursuant to subsection
4.1(b) or (c) shall be made first to Alternate Base Rate Loans and second to
Eurodollar Loans within a Class of Loans. Each prepayment of the Loans under
subsection 4.1(b) or (c) (other than Revolving Credit Loans that are Alternate
Base Rate Loans) shall be accompanied by accrued interest to the date of such
prepayment on the amount prepaid.
(e) For purposes of Section 4.1(c)(ii), Net Proceeds of any of
the following issuances of Equity Interests by EPN or any of its Restricted
Subsidiaries shall not be required to be applied in prepayment of the Loans:
(i) issuances in connection with the Equity
Contribution;
(ii) issuances upon the exercise of any options or
warrants to purchase equity or debt securities of EPN or its Restricted
Subsidiaries;
(iii) issuances to the management of (A) EPN or (B)
its Restricted Subsidiaries;
37
(iv) issuances made in connection with an
acquisition, whether such issuance is of securities issued directly to the
seller or such issuance is issued to the public and the cash is used in full to
pay the purchase price for such acquisition;
(v) issuances to (A) Affiliates of EPN (provided,
that for purposes of this Section 4.1(e), such issuances, other than issuances
to Restricted Subsidiaries of EPN, shall not exceed in the aggregate
$20,000,000) or its Restricted Subsidiaries or (B) EPN or its Restricted
Subsidiaries; or
(vi) issuances and sales of equity securities by EPN,
from time to time, through Xxxxxxx Xxxxxxx Securities Corporation, or such other
sales manager, on a best efforts basis pursuant to such sales manager's DOCS
Financing Program, or such other similar program.
Section 4.2 Conversion and Continuation Options.
(a) The Borrower may elect from time to time to convert
Eurodollar Loans to Alternate Base Rate Loans by giving the Administrative Agent
at least two Business Days' prior irrevocable notice of such election, provided
that any such conversion of Eurodollar Loans may only be made on the last day of
an Interest Period with respect thereto. The Borrower may elect from time to
time to convert Alternate Base Rate Loans to Eurodollar Loans by giving the
Administrative Agent at least three Working Days' prior irrevocable notice of
such election. Any such notice of conversion to Eurodollar Loans shall specify
the length of the initial Interest Period or Interest Periods therefor. Upon
receipt of any such notice the Administrative Agent shall promptly notify each
Applicable Lender thereof. All or any part of outstanding Eurodollar Loans and
Alternate Base Rate Loans may be converted as provided herein, provided that (i)
no Loan may be converted into a Eurodollar Loan when any Default or Event of
Default has occurred and is continuing and the Administrative Agent has or the
Required Lenders have determined that such a conversion is not appropriate, (ii)
any such conversion may only be made if, after giving effect thereto, Section
4.3 shall not have been contravened and (iii) no Loan may be converted into a
Eurodollar Loan after the date that is one month prior to the Revolving Credit
Termination Date or Term Loan Maturity Date, as applicable.
(b) Any Eurodollar Loans may be continued as such upon the
expiration of the then current Interest Period with respect thereto by the
Borrower giving notice to the Administrative Agent, in accordance with the
applicable provisions of the term "Interest Period" set forth in Section 1.1, of
the length of the next Interest Period to be applicable to such Loans, provided
that no Eurodollar Loan may be continued as such (i) when any Default or Event
of Default has occurred and is continuing and the Administrative Agent has or
the Required Lenders have determined that such a continuation is not
appropriate, (ii) if, after giving effect thereto, Section 4.3 would be
contravened or (iii) after the date that is one month prior to the Revolving
Credit Termination Date or the Term Loan Maturity Date, as applicable, and
provided, further, that if the Borrower shall fail to give any required notice
as described above in this paragraph or if such continuation is not permitted
pursuant to the preceding proviso such Loans shall be automatically converted to
Alternate Base Rate Loans on the last day of such then expiring Interest Period.
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Section 4.3 Minimum Amounts of Tranches. All borrowings, conversions
and continuations of Loans hereunder and all selections of Interest Periods
hereunder shall be in such amounts and be made pursuant to such elections so
that, after giving effect thereto, (a) the aggregate principal amount of the
Loans comprising each Tranche shall be equal to $2,000,000 or a whole multiple
of $500,000 in excess thereof, and (b) the number of Tranches then outstanding
shall not exceed eight.
Section 4.4 Interest Rates and Payment Dates.
(a) Each Eurodollar Loan shall bear interest for each day
during each Interest Period with respect thereto at a rate per annum equal to
the Eurodollar Rate determined for such day plus the Applicable Margin.
(b) Each Alternate Base Rate Loan shall bear interest at a
rate per annum equal to the Alternate Base Rate plus the Applicable Margin.
(c) If all or a portion of (i) the principal amount of any
Loan, (ii) any interest payable thereon or (iii) any commitment fee or other
amount payable hereunder shall not be paid when due (whether at the stated
maturity, by acceleration or otherwise), such overdue amount shall bear interest
at a rate per annum which is the higher of (A) the rate that would otherwise be
applicable thereto pursuant to the foregoing provisions of this Section 4.4 plus
2% and (B) the Alternate Base Rate plus 1%, in each case from the date of such
non-payment until such amount is paid in full (as well after as before
judgment).
(d) Interest shall be payable in arrears on each Interest
Payment Date, provided that interest accruing pursuant to paragraph (c) of this
Section 4.4 shall be payable from time to time on demand.
Section 4.5 Computation of Interest and Fees.
(a) Except as otherwise provided in Section 3.4(e), interest
on Alternate Base Rate Loans, commitment fees and interest on overdue interest,
commitment fees and other amounts payable hereunder shall be calculated on the
basis of a 365- (or 366-, as the case may be) day year for the actual days
elapsed. Interest on Eurodollar Loans shall be calculated on the basis of a
360-day year for the actual days elapsed. The Administrative Agent shall as soon
as practicable notify the Borrower and the Lenders of each determination of a
Eurodollar Rate. Any change in the interest rate on a Loan resulting from a
change in the Alternate Base Rate or the Eurocurrency Reserve Requirements shall
become effective as of the opening of business on the day on which such change
becomes effective. The Administrative Agent shall as soon as practicable notify
the Borrower and the Lenders of the effective date and the amount of each such
change in interest rate.
(b) Each determination of an interest rate by the
Administrative Agent pursuant to any provision of this Agreement shall be
conclusive and binding on the Borrower and the Lenders in the absence of
manifest error. The Administrative Agent shall, at the request of the Borrower,
deliver to the Borrower a statement showing the quotations used by the
Administrative Agent in determining any interest rate pursuant to subsection
4.4(a).
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Section 4.6 Inability to Determine Interest Rate. If prior to the first
day of any Interest Period:
(a) the Administrative Agent shall have determined (which
determination shall be conclusive and binding upon the Borrower) that, by reason
of circumstances affecting the relevant market, adequate and reasonable means do
not exist for ascertaining the Eurodollar Rate for such Interest Period, or
(b) the Administrative Agent shall have received notice from
the Required Lenders that the Eurodollar Rate determined or to be determined for
such Interest Period will not adequately and fairly reflect the cost to such
Lenders (as conclusively certified by such Lenders) of making or maintaining
their affected Loans during such Interest Period,
the Administrative Agent shall give telecopy or telephonic notice thereof to the
Borrower and the Lenders as soon as practicable thereafter. If such notice is
given (x) any Eurodollar Loans requested to be made on the first day of such
Interest Period shall be made as Alternate Base Rate Loans, (y) any Loans that
were to have been converted on the first day of such Interest Period to
Eurodollar Loans shall be converted to or continued as Alternate Base Rate Loans
and (z) any outstanding Eurodollar Loans shall be converted, on the first day of
such Interest Period, to Alternate Base Rate Loans. Until such notice has been
withdrawn by the Administrative Agent, no further Eurodollar Loans shall be made
or continued as such, nor shall the Borrower have the right to convert Loans to
Eurodollar Loans.
Section 4.7 Pro Rata Treatment and Payments.
(a) Each borrowing by the Borrower from the Revolving Credit
Lenders hereunder, each payment by the Borrower on account of any commitment fee
payable pursuant to Section 2.5(a) hereunder and any reduction of the Revolving
Credit Commitments of the Lenders shall be made pro rata according to the
respective Revolving Credit Commitment Percentages of the Revolving Credit
Lenders. Each payment of the Borrower on account of any commitment fee payable
pursuant to Section 2.5(b) shall be made pro rata according to the respective
Term Loan Percentages of the Term Loan Lenders. On the Closing Date in the case
of the Initial Term Loans, and after the Closing Date but on or prior to the
Additional Term Loan Borrowing Date, in the case of the Additional Term Loans,
the borrowing by the Borrower from the Term Loan Lenders hereunder shall be made
pro rata according to the respective Term Loan Percentages of the Term Loan
Lenders. Each payment (including each prepayment) by the Borrower on account of
principal of and interest on the (i) Term Loans shall be made pro rata according
to the respective outstanding principal amounts of the Term Loans then held by
the Term Loan Lenders, or (ii) Revolving Credit Loans shall be made pro rata
according to the respective outstanding principal amounts of the Revolving
Credit Loans then held by the Revolving Credit Lenders. All payments (including
prepayments) to be made by the Borrower hereunder, whether on account of
principal, interest, fees or otherwise, shall be made without set off or
counterclaim and shall be made prior to 12:00 Noon, New York City time, on the
due date thereof to the Administrative Agent, for the account of the Lenders, at
the Administrative Agent's office specified in Section 11.2, in Dollars and in
immediately available funds. The Administrative Agent shall distribute such
payments to the Applicable Lenders promptly upon receipt in like funds as
received. If any payment hereunder (other than payments on the
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Eurodollar Loans) becomes due and payable on a day other than a Business Day,
such payment shall be extended to the next succeeding Business Day, and, with
respect to payments of principal, interest thereon shall be payable at the then
applicable rate during such extension and with respect to payments of fees, such
fees accruing during such extension shall be payable on the next succeeding
Business Day. If any payment on a Eurodollar Loan becomes due and payable on a
day other than a Working Day, the maturity thereof shall be extended to the next
succeeding Working Day unless the result of such extension would be to extend
such payment into another calendar month, in which event such payment shall be
made on the immediately preceding Working Day.
(b) Unless the Administrative Agent shall have been notified
in writing by any Lender prior to a Borrowing Date that such Lender will not
make the amount that would constitute its Applicable Commitment Percentage of
the borrowing on such date available to the Administrative Agent, the
Administrative Agent may assume that such Lender has made such amount available
to the Administrative Agent on such Borrowing Date, and the Administrative Agent
may, in reliance upon such assumption, make available to the Borrower a
corresponding amount. If such amount is made available to the Administrative
Agent on a date after such Borrowing Date, such Lender shall pay to the
Administrative Agent on demand an amount equal to the product of (i) the daily
average Federal Funds Effective Rate during such period, times (ii) the amount
of such Lender's Applicable Commitment Percentage of such borrowing, times (iii)
a fraction the numerator of which is the number of days that elapse from and
including such Borrowing Date to the date on which such Lender's Applicable
Commitment Percentage of such borrowing shall have become immediately available
to the Administrative Agent and the denominator of which is 360. A certificate
of the Administrative Agent submitted to any Lender with respect to any amounts
owing under this Section 4.7 shall be conclusive in the absence of manifest
error. If such Lender's Applicable Commitment Percentage of such borrowing is
not in fact made available to the Administrative Agent by such Lender within
three Business Days of such Borrowing Date, the Administrative Agent shall be
entitled to recover such amount with interest thereon at the rate per annum
applicable to Alternate Base Rate Loans hereunder, on demand, from the Borrower.
Section 4.8 Illegality. Notwithstanding any other provision herein, if
the adoption of or any change in any Requirement of Law or in the interpretation
or application thereof shall make it unlawful for any Lender to make or maintain
Eurodollar Loans as contemplated by this Agreement, (a) the commitment of such
Lender hereunder to make Eurodollar Loans, continue Eurodollar Loans as such and
convert Alternate Base Rate Loans to Eurodollar Loans shall forthwith be
cancelled and (b) such Lender's Loans then outstanding as Eurodollar Loans, if
any, shall be converted automatically to Alternate Base Rate Loans on the
respective last days of the then current Interest Periods with respect to such
Loans or within such earlier period as required by law. If any such conversion
of a Eurodollar Loan occurs on a day which is not the last day of the then
current Interest Period with respect thereto, the Borrower shall pay to such
Lender such amounts, if any, as may be required pursuant to Section 4.11.
Section 4.9 Requirements of Law.
(a) If the adoption of or any change in any Requirement of Law
or in the interpretation or application thereof or compliance by any Lender with
any request or directive
41
(whether or not having the force of law) from any central bank or other
Governmental Authority made subsequent to the date hereof:
(i) shall subject any Lender to any tax of any kind
whatsoever with respect to this Agreement, any Note, any Letter of Credit, any
Application or any Eurodollar Loan made by it, or change the basis of taxation
of payments to such Lender in respect thereof (except for taxes covered by
Section 4.10 and changes in the rate of tax on the overall net income of such
Lender);
(ii) shall impose, modify or hold applicable any
reserve, special deposit, compulsory loan or similar requirement against assets
held by, deposits or other liabilities in or for the account of, advances, loans
or other extensions of credit by, or any other acquisition of funds by, any
office of such Lender which is not otherwise included in the determination of
the Eurodollar Rate hereunder; or
(iii) shall impose on such Lender any other
condition;
and the result of any of the foregoing is to increase the cost to such Lender,
by an amount which such Lender deems to be material, of making, converting into,
continuing or maintaining Eurodollar Loans or issuing or participating in the
Letters of Credit or to reduce any amount receivable hereunder in respect
thereof, then, in any such case, the Borrower shall promptly pay such Lender,
upon its demand, any additional amounts necessary to compensate such Lender for
such increased cost or reduced amount receivable. If any Lender becomes entitled
to claim any additional amounts pursuant to this Section 4.9, it shall promptly
notify the Borrower, through the Administrative Agent, of the event by reason of
which it has become so entitled. A certificate as to any additional amounts
payable pursuant to this Section 4.9 submitted by such Lender, through the
Administrative Agent, to the Borrower shall be conclusive in the absence of
manifest error. This covenant shall survive the termination of this Agreement
and the payment of all amounts payable hereunder.
(b) If any Lender shall have determined that the adoption of
or any change in any Requirement of Law regarding capital adequacy or in the
interpretation or application thereof or compliance by such Lender or any
corporation controlling such Lender with any request or directive regarding
capital adequacy (whether or not having the force of law) from any Governmental
Authority made subsequent to the date hereof does or shall have the effect of
reducing the rate of return on such Lender's or such corporation's capital as a
consequence of its obligations hereunder or under any Letter of Credit to a
level below that which such Lender or such corporation could have achieved but
for such change or compliance (taking into consideration such Lender's or such
corporation's policies with respect to capital adequacy) by an amount deemed by
such Lender to be material, then from time to time, after submission by such
Lender to the Borrower (with a copy to the Administrative Agent) of a written
request therefor, the Borrower shall pay to such Lender such additional amount
or amounts as will compensate such Lender for such reduction.
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Section 4.10 Taxes.
(a) All payments made by the Borrower under this Agreement
shall be made free and clear of, and without deduction or withholding for or on
account of, any present or future income, stamp or other taxes, levies, imposts,
duties, charges, fees, deductions or withholdings, now or hereafter imposed,
levied, collected, withheld or assessed by any Governmental Authority,
excluding, in the case of the Administrative Agent and each Lender, net income
taxes and franchise taxes (imposed in lieu of net income taxes) imposed on the
Administrative Agent or such Lender, as the case may be, as a result of a
present or former connection between the jurisdiction of the government or
taxing authority imposing such tax and the Administrative Agent or such Lender
(excluding a connection arising solely from the Administrative Agent or such
Lender having executed, delivered or performed its obligations or received a
payment under, or enforced, this Agreement) or any political subdivision or
taxing authority thereof or therein (all such non-excluded taxes, levies,
imposts, duties, charges, fees, deductions and withholdings being hereinafter
called "Taxes"). If any Taxes are required to be withheld from any amounts
payable to the Administrative Agent or any Lender hereunder, the amounts so
payable to the Administrative Agent or such Lender shall be increased to the
extent necessary to yield to the Administrative Agent or such Lender (after
payment of all Taxes) interest or any such other amounts payable hereunder at
the rates or in the amounts specified in this Agreement. Whenever any Taxes are
payable by the Borrower, as promptly as possible thereafter the Borrower shall
send to the Administrative Agent for its own account or for the account of such
Lender, as the case may be, a certified copy of an original official receipt
received by the Borrower showing payment thereof. If the Borrower fails to pay
any Taxes when due to the appropriate taxing authority or fails to remit to the
Administrative Agent the required receipts or other required documentary
evidence, the Borrower shall indemnify the Administrative Agent and the Lenders
for any incremental taxes, interest or penalties that may become payable by the
Administrative Agent or any Lender as a result of any such failure. The
agreements in this Section 4.10 shall survive the termination of this Agreement
and the payment of all amounts payable hereunder.
(b) Each Lender that is not incorporated under the laws of the
United States of America or a state thereof shall:
(i) deliver to the Borrower and the Administrative
Agent (A) two duly completed copies of United States Internal Revenue Service
Form W8-ECI or W8-BEN, or successor applicable form, as the case may be, and (B)
an Internal Revenue Service Form W-8 or W-9, or successor applicable form, as
the case may be;
(ii) deliver to the Borrower and the Administrative
Agent two further copies of any such form or certification on or before the date
that any such form or certification expires or becomes obsolete and after the
occurrence of any event requiring a change in the most recent form previously
delivered by it to the Borrower; and
(iii) obtain such extensions of time for filing and
complete such forms or certifications as may reasonably be requested by the
Borrower or the Administrative Agent;
43
unless in any such case an event (including, without limitation, any change in
treaty, law or regulation) has occurred prior to the date on which any such
delivery would otherwise be required which renders all such forms inapplicable
or which would prevent such Lender from duly completing and delivering any such
form with respect to it and such Lender so advises the Borrower and the
Administrative Agent. Such Lender shall certify (i) in the case of a Form W8-ECI
or W8-BEN, that it is entitled to receive payments under this Agreement without
deduction or withholding of any United States federal income taxes and (ii) in
the case of a Form W-8 or W-9, that it is entitled to an exemption from United
States backup withholding tax. Each Person that shall become a Lender or a
Participant pursuant to Section 11.6 shall, upon the effectiveness of the
related transfer, be required to provide all of the forms and statements
required pursuant to this Section 4.10, provided that in the case of a
Participant such Participant shall furnish all such required forms and
statements to the Lender from which the related participation shall have been
purchased.
Section 4.11 Indemnity. The Borrower agrees to indemnify each Lender
and to hold each Lender harmless from any loss or expense which such Lender may
sustain or incur as a consequence of (a) default by the Borrower in payment when
due of the principal amount of or interest on any Eurodollar Loan, (b) default
by the Borrower in making a borrowing of, conversion into or continuation of
Eurodollar Loans after the Borrower has given a notice requesting the same in
accordance with the provisions of this Agreement, (c) default by the Borrower in
making any prepayment after the Borrower has given a notice thereof in
accordance with the provisions of this Agreement or (d) the making of a
prepayment of Eurodollar Loans on a day which is not the last day of an Interest
Period with respect thereto, including, without limitation, in each case, any
such loss or expense arising from the reemployment of funds obtained by it or
from fees payable to terminate the deposits from which such funds were obtained.
This covenant shall survive the termination of this Agreement and the payment of
the Notes and all other amounts payable hereunder.
Section 4.12 Lenders Obligation to Mitigate. Each Lender agrees that,
as promptly as practicable after it becomes aware that it has been or will be
affected by the occurrence of an event or the existence of a condition described
under Section 4.8 or subsection 4.9(a) or 4.10(a), it will, to the extent not
inconsistent with such Lender's internal policies, use its best efforts (a) to
provide written notice to the Borrower describing such condition and the
anticipated effect thereof and (b) to make, fund or maintain the affected
Eurodollar Loans of such Lender through another lending office of such Lender if
as a result thereof the additional moneys which would otherwise be required to
be paid in respect of such Loans pursuant to Section 4.8 or subsection 4.9(a) or
4.10(a) would be materially reduced or the illegality or other adverse
circumstances which would otherwise require such payment pursuant to Section 4.8
or subsection 4.9(a) or 4.10(a) would cease to exist and if, as determined by
such Lender, in its sole discretion, the making, funding or maintaining of such
Loans through such other lending office would not otherwise adversely affect
such Loans or such Lender. The Borrower hereby agrees to pay all reasonable
expenses incurred by any Lender in utilizing another lending office of such
Lender pursuant to this Section 4.12.
Section 4.13 Certain Permitted Transactions. Notwithstanding any
provision in the Loan Documents and without increasing the obligations of the
Lenders under Articles II and III
44
of this Agreement, the Borrower shall have the right to effect a reorganization
(the "Reorganization Transactions") of the Subsidiaries acquired in the
Acquisition as follows:
(a) The Borrower and its Subsidiaries shall be permitted to
convert Warwink I, Warwink II and Offshore Gathering & Transmission from limited
liability companies into limited partnerships, with the Borrower owning a 99%
limited partnership interest in each converted Subsidiary and EPN Gathering and
Treating owning the 1% general partnership interest thereof.
(b) The Borrower shall also be permitted to effect the merger
of Indian Basin GP with and into EPN Gathering and Treating, such that EPN
Gathering and Treating will be the survivor of such merger.
(c) The Borrower shall be permitted to contribute those assets
referred to as the "Waha" and "Carlsbad" assets to EPN Gathering and Treating.
The Borrower and its Subsidiaries intend that during and after the consummation
of the Reorganization Transactions, the Security Documents shall continue to be
effective to create in favor of the Administrative Agent, for the ratable
benefit of the Lenders, a legal, valid enforceable, and first perfected security
interest in the Collateral covered thereby prior to the Reorganization
Transactions that is affected by the Reorganization Transactions (as the nature
of such Collateral may change pursuant to the Reorganization Transactions). The
Loan Parties and the Administrative Agent shall enter into such amendments to
the Security Documents or other instruments that are necessary to reflect the
Reorganization Transactions and effect or continue such perfected security
interests in such Collateral.
Section 4.14 Acquisition; Disposition. If the Borrower or any of its
Subsidiaries acquires any Acquired Business or makes any sale or disposition of
any assets or property having a value in excess of $5,000,000 pursuant to
subsection 8.6(b) during any Calculation Period, Consolidated EBITDA,
Consolidated Tangible Net Worth, Consolidated Interest Expense, and Consolidated
Total Indebtedness for such Calculation Period will be determined on a pro forma
basis as if such Acquired Business was acquired or such assets or property was
sold or disposed of on the first day thereof. Such pro forma adjustments will be
subject to delivery to the Administrative Agent of a certificate of a
Responsible Officer of the Borrower. Such certificate may be delivered at any
time after the last day of the first fiscal quarter of the Borrower to end after
the related acquisition date with respect to any Acquired Business or the
related disposition date with respect to any such sale or disposition. Each such
certificate shall be accompanied by supporting information and calculations with
respect to each such Acquired Business, sale or disposition and such other
information as any Lender, through the Administrative Agent, may reasonably
request For purposes of determining satisfaction of Section 6.2(d), effect shall
be given on the date of determination to pro forma adjustments as described in
this Section 4.14 with respect to any Acquired Business that has been acquired
as of such date.
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ARTICLE V
REPRESENTATIONS AND WARRANTIES
To induce the Administrative Agent and the Lenders to enter into this
Agreement and to make the Loans and issue or participate in the Letters of
Credit, the Borrower hereby represents and warrants to the Administrative Agent
and each Lender that:
Section 5.1 Financial Condition. (a) The unaudited pro forma combined
balance sheet of the Borrower and its Subsidiaries as of the Closing Date and
the unaudited pro forma combined income statements of the assets acquired by the
Borrower and its Subsidiaries pursuant to the Acquisition (together with the
data needed to calculate Consolidated EBITDA) for each of the years ended
December 31, 2000 and December 31, 2001, respectively, copies of which have been
heretofore been furnished to the Administrative Agent and each Lender, present
fairly on an actual basis, with respect to the balance sheet, the financial
position of the Borrower and its Subsidiaries on the Closing Date and on a
historical basis, with respect to the income statements, the financial position
of the assets acquired by the Borrower and its Subsidiaries pursuant to the
Acquisition, for the periods covered thereby, and are based on good faith
assumptions believed by the management of the Borrower to be reasonable at the
time made.
(b) The Projections delivered to the Administrative Agent and
the Lenders prior to the Closing Date have been prepared in good faith and are
based on reasonable assumptions on the Closing Date, and there are no statements
or conclusions in the Projections which are based upon or include information
known to the Borrower on the Closing Date to be misleading in any material
respect or which fail to take into account material information known to the
Borrower on the Closing Date regarding the matters reported therein. On the
Closing Date, Borrower believes that the Projections are reasonable; it being
recognized by the Administrative Agent and the Lenders, however, that
projections as to future events are not to be viewed as facts and that the
actual results during the period or periods covered by the Projections may
differ from the projected results and such differences may be material.
Section 5.2 No Change. Since December 31, 2001 (but for this purpose,
assuming that the Transaction had occurred immediately prior thereto), (a) there
has been no development or event which has had or could reasonably be expected
to have a Material Adverse Effect and (b) no dividends or other distributions
have been declared, paid or made upon the Equity Interests of the Borrower
except as permitted by Section 8.7, nor has any of the Equity Interests of the
Borrower been redeemed, retired, purchased or otherwise acquired for value by
the Borrower or any of its Subsidiaries.
Section 5.3 Existence; Compliance with Law. Each of the Borrower and
its Subsidiaries (a) is duly organized, validly existing and in good standing
under the laws of the jurisdiction of its organization, (b) has the power and
authority, and the legal right, to own and operate its property, to lease the
property it operates as lessee and to conduct the business in which it is
currently engaged, (c) is duly qualified as a foreign corporation, limited
partnership, or limited liability company, as the case may be, and, where
applicable, in good standing under the laws of each jurisdiction where its
ownership, lease or operation of property or the conduct of its business
requires such qualification and (d) is in compliance with all Requirements of
Law
46
except to the extent that the failure to comply therewith could not, in the
aggregate, reasonably be expected to have a Material Adverse Effect.
Section 5.4 Power; Authorization; Enforceable Obligations.
(a) The Borrower has the power and authority, and the legal
right, to make, deliver and perform this Agreement, the Notes and the other Loan
Documents to which it is a party and to borrow hereunder and has taken all
necessary action to authorize the borrowings on the terms and conditions of this
Agreement and the Notes and to authorize the execution, delivery and performance
of this Agreement, the Notes and the other Loan Documents to which it is a
party. No consent or authorization of, filing with, notice to or other act by or
in respect of, any Governmental Authority or any other Person is required in
connection with the borrowings hereunder or with the execution, delivery,
performance, validity or enforceability of this Agreement or the Notes or the
Applications. This Agreement has been, and each Note and the Applications will
be, duly executed and delivered on behalf of the Borrower. This Agreement
constitutes, and each Note and each other Loan Document to which the Borrower is
a party when executed and delivered will constitute, a legal, valid and binding
obligation of the Borrower enforceable against the Borrower in accordance with
its terms, except as enforceability may be limited by applicable bankruptcy,
insolvency, reorganization, moratorium or similar laws affecting the enforcement
of creditors' rights generally and by general equitable principles (whether
enforcement is sought by proceedings in equity or at law).
(b) Each of the Subsidiary Guarantors has the power and
authority, and the legal right, to make, deliver and perform the Loan Documents
to which it is a party and has taken all necessary action to authorize the
execution, delivery and performance of the Loan Documents to which it is a
party. No consent or authorization of, filing with, notice to or other act by or
in respect of, any Governmental Authority or any other Person is required in
connection with the borrowings hereunder or with the execution, delivery,
performance, validity or enforceability of the Loan Documents to which such
Subsidiary Guarantor is a party. Each of the Loan Documents to which such
Subsidiary Guarantor is a party will be duly executed and delivered on behalf of
such Subsidiary Guarantor. Each Loan Document to which such Subsidiary Guarantor
is a party will, when executed and delivered, constitute a legal, valid and
binding obligation of such Subsidiary Guarantor enforceable against such
Subsidiary Guarantor in accordance with its terms, except as enforceability may
be limited by applicable bankruptcy, insolvency, reorganization, moratorium or
similar laws affecting the enforcement of creditors' rights generally and by
general equitable principles (whether enforcement is sought by proceedings in
equity or at law).
Section 5.5 No Legal Bar. The execution, delivery and performance of
this Agreement, the Notes and the other Loan Documents, the borrowings hereunder
and the use of the proceeds thereof will not violate any Requirement of Law or
Contractual Obligation of any Loan Party, or, to the best knowledge of the
Borrower, any Joint Venture any of the interests in which is owned by a
Subsidiary of the Borrower, and will not result in, or require, the creation or
imposition of any Lien on any of their respective properties or revenues
pursuant to any such Requirement of Law or Contractual Obligation.
47
Section 5.6 No Material Litigation. Except as set forth on Schedule
5.6, no litigation, investigation or proceeding of or before any arbitrator or
Governmental Authority is pending or, to the knowledge of the Borrower,
threatened by or against the Borrower or any of its Subsidiaries, or, to the
best knowledge of the Borrower, any Joint Venture any of the interests in which
is owned by a Subsidiary of the Borrower, or against any of its or their
respective properties or revenues (a) with respect to this Agreement, the Notes
or any of the other Loan Documents or any of the transactions contemplated
hereby or thereby, or (b) which could reasonably be expected to have a Material
Adverse Effect.
Section 5.7 No Default. As of the Closing Date, all Contractual
Obligations of any Loan Party are in full force and effect except in any respect
which could not reasonably be expected to have a Material Adverse Effect. No
Loan Party, and, to the best knowledge of the Borrower, no Joint Venture any of
the interests in which is owned by a Subsidiary of the Borrower, is in default
under or with respect to any of its Contractual Obligations in any respect which
could reasonably be expected to have a Material Adverse Effect. No Default or
Event of Default has occurred and is continuing.
Section 5.8 Ownership of Property; Liens. Each of the Borrower and its
Subsidiaries has good record and marketable title in fee simple to, or a valid
leasehold interest in, all its real property necessary for its operations as
then conducted, and good title to, or a valid leasehold interest in, all its
other property, and none of such property necessary for its operations as then
conducted is subject to any Lien except as permitted by Section 8.3.
Section 5.9 Intellectual Property. The Borrower and each of its
Subsidiaries owns, or is licensed to use, all trademarks, tradenames,
copyrights, technology, know-how and processes necessary for the conduct of its
business as currently conducted except for those the failure to own or license
which could not have a Material Adverse Effect (the "Intellectual Property"). No
claim has been asserted and is pending by any Person challenging or questioning
the use of any such Intellectual Property or the validity or effectiveness of
any such Intellectual Property, nor does the Borrower know of any valid basis
for any such claim. The use of such Intellectual Property by the Borrower and
its Subsidiaries does not infringe on the rights of any Person, except for such
claims and infringements that, in the aggregate, do not have a Material Adverse
Effect.
Section 5.10 No Burdensome Restrictions. The Borrower, in good faith,
does not believe any Requirement of Law or Contractual Obligation of the
Borrower or any of its Subsidiaries could reasonably be expected to have a
Material Adverse Effect.
Section 5.11 Taxes. Each of the Borrower and its Subsidiaries has filed
or caused to be filed all tax returns which, to the knowledge of the Borrower,
are required to be filed and has paid all taxes shown to be due and payable on
said returns or on any assessments made against it or any of its property and
all other taxes, fees or other charges imposed on it or any of its property by
any Governmental Authority (other than any the amount or validity of which are
currently being contested in good faith by appropriate proceedings and with
respect to which reserves in conformity with GAAP have been provided on the
books of the Borrower or its Subsidiaries, as the case may be); no tax Lien has
been filed, and, to the knowledge of the Borrower, no claim is being asserted,
with respect to any such tax, fee or other charge.
48
Section 5.12 Federal Regulations. No part of the proceeds of any Loans
will be used for "purchasing" or "carrying" any "margin stock" within the
respective meanings of each of the quoted terms under Regulation U of the Board
of Governors of the Federal Reserve System as now and from time to time
hereafter in effect or for any purpose which violates the provisions of the
Regulations of such Board of Governors. If requested by any Lender or the
Administrative Agent, the Borrower will furnish to the Administrative Agent and
each Lender a statement to the foregoing effect in conformity with the
requirements of FR Form U-1 referred to in said Regulation U.
Section 5.13 ERISA. No Loan Party has or is a party to, or has any
matured or contingent obligations under, any Plans.
Section 5.14 Investment Company Act; Other Regulations. The Borrower is
not an "investment company", or a company "controlled" by an "investment
company", within the meaning of the Investment Company Act of 1940, as amended.
The Borrower is not subject to regulation under any Federal or State statute or
regulation which limits its ability to incur Indebtedness.
Section 5.15 Subsidiaries. The Persons set forth on Schedule 5.15
constitute all of the Subsidiaries of the Borrower as of the Closing Date (both
before and after the Reorganization Transactions as indicated in such Schedule),
and the percentage of the Equity Interests owned by the Borrower in each such
Person as of such date (both before and after the Reorganization Transactions as
indicated in such Schedule). As of the Closing Date, there are no Joint
Ventures.
Section 5.16 Purpose of Loans, Letters of Credit. All proceeds of the
Initial Term Loans shall be used on the Closing Date to finance a portion of the
Acquisition and to pay related fees and expenses. All proceeds of the Additional
Term Loans shall be used to repay the Indian Basin Indebtedness. The proceeds of
the Revolving Credit Loans shall be used by the Borrower for working capital
purposes and other general corporate purposes, and shall not be used to finance
the Acquisition or to pay fees and expenses in connection therewith other than
to finance any Purchase Price Adjustment payable to the Sellers reasonably
satisfactory to the Administrative Agent. The Letters of Credit shall be used
for the purposes described in subsection 3.1(b).
Section 5.17 Environmental Matters. Except as set forth on Schedule
5.17:
(a) To the best knowledge of the Borrower, the Properties do
not contain, and have not previously contained, any Materials of Environmental
Concern in amounts or concentrations which (i) constitute or constituted a
violation of, or (ii) give rise to liability under, any Environmental Law,
except in either case insofar as such violation or liability, or any aggregation
thereof, could not reasonably be expected to result in the payment of a Material
Environmental Amount.
(b) To the best knowledge of the Borrower, the Properties and
all operations at the Properties are in compliance, and have in the period
commencing six months prior to the date hereof been in compliance, in all
material respects with all applicable Environmental Laws, and there is no
contamination at, under or about the Properties or violation of any
Environmental
49
Law with respect to the Properties or the business operated by the Borrower or
any of its Subsidiaries or any Joint Venture (the "Business") which could
materially interfere with the continued operation of any material Property or
which could reasonably be expected to have a Material Adverse Effect.
(c) Neither the Borrower nor any of its Subsidiaries nor, to
the best knowledge of the Borrower, any Joint Venture has received any notice of
violation, alleged violation, non-compliance, liability or potential liability
regarding environmental matters or compliance with Environmental Laws with
regard to any of the Properties or the Business, nor does the Borrower have
knowledge or reason to believe that any such notice will be received or is being
threatened except insofar as such notice or threatened notice, or any
aggregation thereof, does not involve a matter or matters that is or could
reasonably be expected to result in the payment of a Material Environmental
Amount.
(d) To the best knowledge of the Borrower, Materials of
Environmental Concern have not been transported or disposed of from the
Properties in violation of, or in a manner or to a location which could
reasonably be expected to give rise to liability under, any Environmental Law,
nor have any Materials of Environmental Concern been generated, treated, stored
or disposed of at, on or under any of the Properties in violation of, or in a
manner that could reasonably be expected to give rise to liability under, any
applicable Environmental Law except insofar as any such violation or liability
referred to in this paragraph, or any aggregation thereof, could not reasonably
be expected to result in the payment of a Material Environmental Amount.
(e) No judicial proceeding or governmental or administrative
action is pending or, to the knowledge of the Borrower, threatened, under any
Environmental Law to which the Borrower or any Subsidiary, or, to the best
knowledge of the Borrower, any Joint Venture, is or will be named as a party
with respect to the Properties or the Business, nor are there any consent
decrees or other decrees, consent orders, administrative orders or other orders,
or other administrative or judicial requirements outstanding under any
Environmental Law with respect to the Properties or the Business except insofar
as such proceeding, action, decree, order or other requirement, or any
aggregation thereof, could not reasonably be expected to result in the payment
of a Material Environmental Amount.
(f) To the best knowledge of the Borrower, there has been no
release or threat of release of Materials of Environmental Concern at or from
the Properties, or arising from or related to the operations of the Borrower or
any Subsidiary or any Joint Venture, in connection with the Properties or
otherwise in connection with the Business, in violation of or in amounts or in a
manner that could give rise to liability under Environmental Laws except insofar
as any such violation or liability referred to in this paragraph, or any
aggregation thereof, could not reasonably be expected to result in the payment
of a Material Environmental Amount.
(g) There are no Liens arising under or pursuant to any
Environmental Laws on any of the real properties or properties owned or leased
by any Loan Party, and no government actions have been taken or are in process
which could subject any of such properties to such Liens and no Loan Party would
be required to place any notice or restriction relating to the presence of
Hazardous Materials at any properties owned by it in any deed to such
properties.
50
(h) There have been no environmental investigations, studies,
audits, tests, reviews or other analyses conducted by or which are in the
possession of any Loan Party in relation to any properties or facility now or
previously owned or leased by any Loan Party which have not been made available
to the Lenders.
Section 5.18 Accuracy and Completeness of Information. The factual
statements contained in the financial statements (other than financial
projections) referred to in Section 5.1, the Loan Documents, the Confidential
Information Memorandum dated March 2002 and any other certificates or documents
furnished or to be furnished (but only, with respect to documents furnished
after the Closing Date, documents provided pursuant to subsection 7.2(d)) to the
Administrative Agent or the Lenders from time to time in connection with this
Agreement, taken as a whole, do not and will not, to the knowledge of the
Borrower, as of the date when made, contain any untrue statement of a material
fact or omit to state a material fact (other than omissions that pertain to
matters of a general economic nature, matters generally known to the
Administrative Agent or matters of public knowledge that generally affect any of
the industry segments included in the Business of the Borrower, its Subsidiaries
or any Joint Venture) necessary in order to make the statements contained
therein not misleading in light of the circumstances in which the same were
made, such knowledge qualification being given only with respect to factual
statements made by Persons other than the Borrower, and all financial
projections contained in any such document or certificate have been prepared in
good faith based upon assumptions believed by the Borrower to be reasonable.
Section 5.19 Security Documents. The Pledge Agreements are each
effective to create in favor of the Administrative Agent, for the ratable
benefit of the Lenders, a legal, valid and enforceable security interest in the
respective Interests described therein and proceeds thereof, and the Pledge
Agreements each constitute a fully perfected first Lien on, and security
interest in, all right, title and interest of the General Partner, the Limited
Partner, the Borrower or the Subsidiary Guarantors, as applicable, in such
Interests and Pledged Certificates described therein and in proceeds thereof
superior in right to any other Person (subject to the Liens permitted pursuant
to Section 8.3). Each Security Agreement is effective to create in favor of the
Administrative Agent, for the ratable benefit of the Lenders, a legal, valid and
enforceable security interest in the respective collateral described therein and
proceeds thereof, and the Security Agreements constitute fully perfected, first
priority Liens on, and security interests in (subject to the Liens permitted
pursuant to Section 8.3), all right, title and interest of the Borrower and the
Subsidiary Guarantors in such collateral and the proceeds thereof superior in
right to any other Person other than Liens permitted hereby.
Section 5.20 Solvency. After giving effect to the Transaction, the
Borrower and its Subsidiaries, on a consolidated basis, are Solvent.
Section 5.21 Transaction. At the time of the consummation thereof, the
Transaction has been consummated in all material respects in accordance with the
terms of the respective Transaction Documents and all applicable laws. All
actions taken by any Loan Party pursuant to or in furtherance of the Transaction
have been taken in all material respects in compliance with the respective
Transaction Documents and all applicable laws.
51
Section 5.22 Insurance. Schedule 5.22 sets forth a true and complete
description of all insurance maintained by the Borrower and its Subsidiaries as
of the Closing Date (after giving effect to the Transaction), with the amounts
insured (and any deductibles) set forth therein.
ARTICLE VI
CONDITIONS PRECEDENT
Section 6.1 Conditions to Initial Extensions of Credit. The agreement
of each Lender to make the initial extension of credit requested to be made by
it is subject to the satisfaction, immediately prior to or concurrently with the
making of such extension of credit on the Closing Date, of the following
conditions precedent:
(a) Loan Documents. The Administrative Agent shall have
received (i) this Agreement, executed and delivered by a duly authorized officer
of the Borrower, (ii) for the account of each Lender which requests the same, a
Revolving Credit Note and/or a Term Note, as applicable, executed and delivered
by a duly authorized officer of the Borrower, and (iii) each of the Guarantees
and Security Documents, executed and delivered by a duly authorized officer of
each Loan Party thereto and satisfactory in form to the Administrative Agent.
(b) Related Agreements. The Administrative Agent shall have
received true and correct copies, certified as to authenticity by the Borrower,
of the Partnership Agreement, the certificate of limited partnership of the
Borrower, the limited liability company agreement, limited partnership
agreement, or other equivalent governance documents, as the case may be, of each
Subsidiary of the Borrower, the General Partner and the Limited Partner, and
such other documents or instruments as may be reasonably requested by the
Administrative Agent.
(c) Borrowing Certificate. The Administrative Agent shall have
received a certificate of the Borrower, dated the Closing Date, substantially in
the form of Exhibit K, with appropriate insertions and attachments, satisfactory
in form and substance to the Administrative Agent, executed by the Chief
Executive Officer, Chief Operating Officer, Chief Financial Officer, President,
Treasurer or any Vice President of the Borrower and the Secretary or any
Assistant Secretary of the Borrower.
(d) Partnership Proceedings of the Borrower. The
Administrative Agent shall have received a copy of the resolutions, in form and
substance satisfactory to the Administrative Agent, of the Managing Members of
the General Partner authorizing on behalf of the Borrower (i) the execution,
delivery and performance of this Agreement and the other Loan Documents to which
the Borrower is a party, (ii) the borrowings contemplated hereunder and (iii)
the granting by the Borrower of the Liens created pursuant to the Security
Documents to which it is a party, certified by the Secretary or an Assistant
Secretary of the General Partner on behalf of the Borrower as of the Closing
Date, which certificate shall be in form and substance satisfactory to the
Administrative Agent and shall state that the resolutions thereby certified have
not been amended, modified, revoked or rescinded (except in connection with the
Reorganization Transactions).
(e) Borrowers Incumbency Certificate. The Administrative Agent
shall have received a certificate of the Borrower, dated the Closing Date, as to
the incumbency and
52
signature of the officers of the Borrower executing any Loan Document,
satisfactory in form and substance to the Administrative Agent, executed by the
Chief Executive Officer, Chief Operating Officer, Chief Financial Officer,
President, Treasurer or any Vice President and the Secretary or any Assistant
Secretary of the Borrower.
(f) Corporate Proceedings of the Borrower Partners. The
Administrative Agent shall have received a copy of the resolutions, in form and
substance satisfactory to the Administrative Agent, of both the Managing Members
of the General Partner and the general partner of the Limited Partner
authorizing (i) the execution, delivery and performance of the Loan Documents to
which the General Partner or the Limited Partner, as applicable, is a party and
(ii) the granting by the General Partner or the Limited Partner, as applicable,
of the Liens created pursuant to the Security Documents to which it is a party,
certified by the Secretary or an Assistant Secretary of the General Partner or
the Limited Partner, as applicable, as of the Closing Date, which certificate
shall be in form and substance satisfactory to the Administrative Agent and
shall state that the resolutions thereby certified have not been amended,
modified, revoked or rescinded (except in connection with the Reorganization
Transactions).
(g) Borrower Partners Incumbency Certificates. The
Administrative Agent shall have received both a certificate of each of the
Borrower Partners, dated the Closing Date, as to the incumbency and signature of
the officers of the General Partner or the Limited Partner, as applicable,
executing any Loan Document, satisfactory in form and substance to the
Administrative Agent, executed by the Chief Executive Officer, Chief Operating
Officer, Chief Financial Officer, President, Treasurer or any Vice President and
the Secretary or any Assistant Secretary of the General Partner or the Limited
Partner, as applicable.
(h) Proceedings of Subsidiaries. The Administrative Agent
shall have received a copy of the resolutions, in form and substance
satisfactory to the Administrative Agent, of the Managing Member(s), the Board
of Directors, or the Managing Members of the General Partner, as applicable, of
each Subsidiary of the Borrower which is a party to a Loan Document authorizing
(i) the execution, delivery and performance of the Loan Documents to which it is
a party and (ii) the granting by it of the Liens created pursuant to the
Security Documents to which it is a party, certified by the Secretary or an
Assistant Secretary of such Subsidiary as of the Closing Date, which certificate
shall be in form and substance satisfactory to the Administrative Agent and
shall state that the resolutions thereby certified have not been amended,
modified, revoked or rescinded (except in connection with the Reorganization
Transactions).
(i) Subsidiary Incumbency Certificates. The Administrative
Agent shall have received a certificate of each Subsidiary of the Borrower which
is a Loan Party, dated the Closing Date, as to the incumbency and signature of
the officers of such Subsidiary executing any Loan Document, satisfactory in
form and substance to the Administrative Agent, executed by the Chief Executive
Officer, Chief Operating Officer, Chief Financial Officer, President, Treasurer
or any Vice President and the Secretary or any Assistant Secretary of each such
Subsidiary.
(j) Corporate Documents. The Administrative Agent shall have
received true and complete copies of the certificate of formation, certificate
of limited partnership or
53
equivalent document, as the case may be, of the General Partner, the Limited
Partner, and each Subsidiary of the Borrower, certified as of the Closing Date
as complete and correct copies thereof by the Secretary or an Assistant
Secretary of such Subsidiary.
(k) Consummation of the Transaction. (i) There shall have been
delivered to the Administrative Agent true and correct copies of the Acquisition
Documents. The Acquisition Documents shall be in form and substance reasonably
satisfactory to the Administrative Agent and shall not have been amended in any
material respect without the consent of the Administrative Agent. All of the
conditions precedent to the consummation of the Acquisition as set forth in the
Acquisition Documents shall have been satisfied (and not waived, unless
consented to by the Administrative Agent) to the reasonable satisfaction of the
Administrative Agent. The Acquisition shall, substantially contemporaneously
with the funding of the Initial Term Loans under the Term Loan Facility, be
consummated in accordance with the terms and conditions of the Acquisition
Documents and all applicable laws. In addition, all assets acquired by the
Borrower and its Subsidiaries pursuant to the Acquisition shall be free and
clear from any Liens.
(ii) (A) The Equity Contribution shall have been paid or
otherwise effected in form and in substance satisfactory to the Administrative
Agent and (B) the proceeds of the cash portion of the Equity Contribution shall
have been used to make payments owing in connection with the Transaction, and
the remaining portion of the Equity Contribution shall have been effected in
connection with the Transaction, substantially contemporaneously with the use of
the proceeds of the Initial Term Loans incurred on the Closing Date for such
purpose. The Equity Contribution shall have been consummated in accordance with
all applicable laws.
(l) Consents, Licenses and Approvals. The Administrative Agent
shall have received, with a counterpart for each Lender, a certificate of a
Responsible Officer of the Borrower (i) attaching copies of all consents,
authorizations and filings referred to in Section 5.4, and (ii) stating that
such consents, licenses and filings are in full force and effect, and each such
consent, authorization and filing shall be in form and substance satisfactory to
the Administrative Agent.
(m) Fees. The Administrative Agent and each Lender shall have
received the fees to be received on or before the Closing Date as separately
agreed to between each of them and the Borrower.
(n) Legal Opinions. The Administrative Agent shall have
received, with a counterpart for each Lender, the executed legal opinion of
Akin, Gump, Strauss, Xxxxx & Xxxx, L.L.P., counsel to the Borrower and the other
Loan Parties, addressed to the Administrative Agent and each Lender in form and
substance reasonably satisfactory to the Administrative Agent.
(o) Pledged Stock; Stock Powers. The Administrative Agent
shall have received the certificates, if any, representing the limited
partnership interests, limited liability company interests and general
partnership interests pledged pursuant to each of the Pledge Agreements,
together with an undated stock power for each such certificate executed in blank
by a duly authorized officer of the pledgor thereof.
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(p) Lien Searches. The Administrative Agent shall have
received lien searches reflecting no prior Liens on the Collateral.
(q) Actions to Perfect Liens. The Administrative Agent shall
have received evidence in form and substance satisfactory to it that all
filings, recordings, registrations and other actions, including, without
limitation, the filing of duly completed financing statements on form UCC-1 and
amendments to financing statements on form UCC-3, necessary or, in the opinion
of the Administrative Agent, desirable to perfect the Liens created by the
Security Documents shall have been completed (subject only to filings thereof to
be completed within 10 days of the Closing Date).
(r) Insurance.
(i) The Administrative Agent shall have received
evidence in form and substance satisfactory to it that all of the requirements
of Section 7.5 shall have been satisfied.
(ii) The Lenders shall be satisfied with, the amount,
coverage and carriers of the insurance carried by the Borrower and its
Subsidiaries (as set forth in Schedule 5.22).
(s) Good Standing Certificates. The Administrative Agent shall
have received copies of certificates dated as of a recent date from the
Secretary of State or other appropriate authority of such jurisdiction,
evidencing the good standing of the Borrower and each other Loan Party in each
state where the ownership, lease or operation of property or the conduct of
business requires it to qualify as a foreign corporation, partnership or limited
liability company, as the case may be.
(t) Litigation, Etc. Except as set forth on Schedule 5.6, no
suit, action, investigation, inquiry or other proceeding (including, without
limitation, the enactment or promulgation of a statute or rule) by or before any
arbitrator or any Governmental Authority shall be pending and no preliminary or
permanent injunction, order, or judgment by a state or federal court shall have
been entered (i) in connection with any Loan Document or any of the transactions
contemplated hereby or thereby or (ii) which, in any such case could reasonably
be expected to have a Material Adverse Effect.
(u) Consents. All material governmental and third party
approvals (or arrangements satisfactory to the Lenders in lieu of such
approvals) necessary or advisable in connection with the Transaction or the
financings or other transactions contemplated hereby and by the other Loan
Documents and the continuing operations of the Borrower and its Subsidiaries
shall have been obtained and be in full force and effect, and all material
applicable waiting periods shall have expired without any action being taken by
any competent authority which restrains, prevents, or imposes materially adverse
conditions upon, the consummation of the Transaction or the financings or other
transactions contemplated hereby. No judgment, order, injunction or other
restraint prohibiting or imposing materially adverse conditions upon, or making
economically unfeasible, the consummation of the Transaction or the transactions
contemplated by the Transaction shall have been entered.
55
(v) Material Adverse Effect. No event which has or could have
a Material Adverse Effect shall have occurred.
(w) Financial Statements. The Administrative Agent shall have
received, with a counterpart for each Lender, complete copies of the financial
statements and Projections described in Section 5.1.
(x) Subsidiaries. Except MIAGS, each of the Loan Parties shall
be a wholly-owned, indirect subsidiary of EPN.
(y) Leverage Ratio. (i) On the Closing Date (and immediately
after giving effect to the Transaction and the related financings), the Leverage
Ratio for the year ended December 31, 2001 (calculated as if the Borrower or its
Subsidiaries had acquired the assets acquired pursuant to the Acquisition on the
first day of such period) shall be no greater than 5.50:1.00 and (ii) the
Administrative Agent shall have received a certificate of the Borrower's chief
financial officer certifying (and showing the calculations therefor in
reasonable detail) as to such Leverage Ratio on the Closing Date (it being
understood that any pro forma adjustments from the actual Consolidated EBITDA
for the year ended December 31, 2001 of the assets acquired pursuant to the
Acquisition shall be reasonably satisfactory to the Administrative Agent).
(z) Second Amendment. The Administrative Agent shall have
received a copy of the Second Amendment, executed and delivered by a duly
authorized officer of EPN, El Paso Energy Partners Finance Corporation, JPMorgan
and the Required Lenders (as such term is defined in the EPN
Credit Agreement).
(aa) Additional Matters. All corporate, company, partnership
and other proceedings, and all documents, instruments and other legal matters in
connection with the transactions contemplated by this Agreement and the other
Loan Documents shall be reasonably satisfactory in form and substance to the
Lenders, and the Lenders shall have received such other documents and legal
opinions in respect of any aspect or consequence of the transactions
contemplated hereby or thereby as any of them shall reasonably request.
Section 6.2 Conditions to Each Extension of Credit. The agreement of
each Lender to make any extension of credit (including the renewal or extension
of a Letter of Credit and its Additional Term Loan) requested to be made by it
on any date (including, without limitation, its initial extension of credit) is
subject to the satisfaction of the following conditions precedent:
(a) Representations and Warranties. Each of the
representations and warranties made by the Borrower and the other Loan Parties
in or pursuant to the Loan Documents shall be true and correct in all material
respects on and as of such date as if made on and as of such date (unless such
representations and warranties are stated to relate to a specific earlier date,
in which case such representations and warranties shall be true and correct in
all material respects as of such earlier date).
(b) No Default. No Default or Event of Default shall have
occurred and be continuing on such date or after giving effect to the extensions
of credit requested to be made on such date.
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(c) Additional Matters. The Administrative Agent shall have
received such other documents and legal opinions in respect of any aspect or
consequence of the transactions contemplated hereby or by the other Loan
Documents as it shall reasonably request.
(d) At the time of and immediately after giving effect to such
extension of credit, the ratio of (X) Consolidated Total Indebtedness at such
date to (Y) the Consolidated EBITDA for the most recent Calculation Period
together with the period from the last day of the most recent Calculation Period
to the date of such extension of credit shall not exceed the appropriate ratio
for such date set forth in the table in Section 8.1(b).Each borrowing by the
Borrower hereunder, and each issuance or renewal or extension of a Letter of
Credit hereunder, shall constitute a representation and warranty by the Borrower
as of the date of such extension of credit or such conversion that the
conditions contained in this Section 6.2 have been satisfied; provided that with
respect to paragraph (d) above, such representation and warranty shall be made
by the Borrower in good faith based upon assumptions believed by the Borrower to
be reasonable.
ARTICLE VII
AFFIRMATIVE COVENANTS
The Borrower hereby agrees that, so long as any Commitment remains in
effect, or any Obligation remains outstanding and unpaid, the Borrower shall and
(except in the case of delivery of financial information, reports and notices)
shall cause each of its Subsidiaries to:
Section 7.1 Financial Statements. Furnish to the Administrative Agent,
with copies for the Lenders:
(a) as soon as available, but in any event within 90 days
after the end of each fiscal year of the Borrower (beginning with the fiscal
year ending December 31, 2002), a copy of the consolidated balance sheet of the
Borrower and its consolidated Subsidiaries as at the end of such year and the
related consolidated statements of income and retained earnings and of cash
flows for such year, setting forth in each case in comparative form the figures
for the previous year, reported on without a "going concern" or like
qualification or exception, or qualification arising out of the scope of the
audit, by PricewaterhouseCoopers LLP or other independent certified public
accountants of nationally recognized standing;
(b) as soon as available, but in any event not later than 45
days after the end of each of the first three quarterly periods of each fiscal
year of the Borrower, the unaudited consolidated and consolidating balance sheet
of the Borrower and its consolidated Subsidiaries as at the end of such quarter
and the related unaudited consolidated and consolidating statements of income
and retained earnings and of cash flows of the Borrower and its consolidated
Subsidiaries for such quarter and the portion of the fiscal year through the end
of such quarter, setting forth in each case in comparative form the figures for
the previous year, certified by a Responsible Officer as being fairly stated in
all material respects when considered in relation to the consolidated and
consolidating financial statements of the Borrower and its consolidated
Subsidiaries (subject to normal year-end audit adjustments);
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(c) as soon as possible, but in any event not later than 60
days after the Closing Date, financial statements satisfying the requirements of
the Securities and Exchange Commission under Item 7 of Form 8-K;
(d) concurrently with the delivery of the financial statements
for any fiscal year described in paragraph (a) or (c) of this Section 7.1, the
unaudited consolidating balance sheets of the Borrower and its consolidated
Subsidiaries as at the end of such fiscal year and the related unaudited
consolidating statements of income and retained earnings and of cash flows of
the Borrower and its consolidated Subsidiaries for such fiscal year, setting
forth in each case in comparative form the figures for the previous year,
certified by a Responsible Officer as being fairly stated in all material
respects when considered in relation to the consolidating financial statements
of the Borrower and its consolidated Subsidiaries;
(e) as soon as available, but in any event within 120 days
after the end of each fiscal year of each material Joint Venture any of the
interests in which is owned by a Subsidiary of the Borrower, a copy of the
audited balance sheet of such Joint Venture, as at the end of such year and the
related unaudited statements of income and retained earnings and of cash flows
of such Joint Venture, for such year, setting forth in each case in a
comparative form the figures for the previous year, reported on without a "going
concern" or like qualification or exception, or qualification arising out of the
scope of the audit, by independent certified public accountants of nationally
recognized standing; and
(f) concurrently with the delivery of the financial statements
referred to in subsection 7.1(b), the unaudited balance sheet of each Joint
Venture any of the interests in which is owned by a Subsidiary of the Borrower,
as at the end of each such quarter of such Joint Venture, and the related
unaudited consolidated statements of income and retained earnings and of cash
flows of such Joint Venture, for such month and the portion of the fiscal year
through the end of such month, setting forth in each case in comparative form
the figures for the previous year, in each case received by the Borrower or any
of its Subsidiaries during such fiscal quarter;
all such financial statements shall be complete and correct in all material
respects and shall be prepared in reasonable detail and (except for the
financial statements of any Joint Venture) in accordance with GAAP applied
consistently throughout the periods reflected therein and with prior periods
(except as approved by such accountants or officer, as the case may be, and
disclosed therein and, with respect to unaudited interim financial statements,
for the absence of footnotes and year-end adjustments).
Section 7.2 Certificates; Other Information. Furnish to the
Administrative Agent, with copies for the Lenders:
(a) concurrently with the delivery of the financial statements
referred to in subsections 7.1(a) and (c), a certificate of the independent
certified public accountants reporting on such financial statements stating that
in making the examination necessary therefor no knowledge was obtained of any
Default or Event of Default relating to accounting issues, except as specified
in such certificate;
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(b) concurrently with the delivery of the financial statements
referred to in subsections 7.1(a) through (c), a certificate of a Responsible
Officer of the Borrower, (i) stating that, to the best of such Officer's
knowledge, the Borrower and its Subsidiaries during such period have observed or
performed all of their respective covenants and other agreements, and satisfied
every condition, contained in this Agreement and in the other Loan Documents to
be observed, performed or satisfied by them, and that such Officer has obtained
no knowledge of any Default or Event of Default except as specified in such
certificate, and (ii) setting forth in reasonable detail the calculation of the
covenants set forth in Section 8.1 for the Calculation Period ending on the last
day of such fiscal quarter;
(c) not later than thirty days after the beginning of each
fiscal year of the Borrower, a copy of the projections by the Borrower of the
operating budget and cash flow budget of the Borrower for such fiscal year, such
projections to be accompanied by a certificate of a Responsible Officer to the
effect that such projections have been prepared on the basis of sound financial
planning practice and that such Officer has no reason to believe they are
incorrect or misleading in any material respect;
(d) within five days after the same are sent, copies of all
financial statements and reports which the Borrower sends to the holders of its
Equity Interests, and within five days after the same are filed, copies of all
financial statements and reports, if any, which the Borrower may make to, or
file with, the Securities and Exchange Commission or any successor or analogous
Governmental Authority;
(e) upon the request of any Lender, and to the extent the same
have been received by the Borrower or any of its Subsidiaries, a copy of the
projections by each Joint Venture any of the interests in which is owned by a
Subsidiary of the Borrower, as the case may be, of the operating budget and cash
flow budget of such Joint Venture for the succeeding fiscal year;
(f) upon the request of any Lender, and to the extent the same
have been received by the Borrower or any of its Subsidiaries, within thirty
days of the end of each of the quarterly periods of each fiscal year of each
Joint Venture any of the interests in which is owned by a Subsidiary of the
Borrower, a list of all shippers that have used such Joint Venture during such
quarterly period and the volumes and revenues attributable to each such shipper;
(g) upon the request of any Lender, and to the extent the same
have been received by the Borrower or any of its Subsidiaries, copies of all
compliance certificates delivered by each Joint Venture any of the interests in
which is owned by a Subsidiary of the Borrower, pursuant to any
credit agreement
to which such Joint Venture is a party;
(h) upon the request of any Lender, within five days after the
same are received by the Borrower, a copy of any FERC Form 2 for any Joint
Venture any of the interests in which is owned by a Subsidiary of the Borrower;
(i) concurrently with the delivery of the financial statements
referred to in subsections 7.1(a) and (c), a certificate signed by the
President, Chief Executive Officer, Chief Operating Officer or Chief Financial
Officer of the Borrower in the form of Exhibit M hereto.
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Further, if requested by the Required Lenders (by notice to the Administrative
Agent, which will give notice of such request to the Borrower and each Lender),
the Borrower shall permit and cooperate with an environmental and safety review
made in connection with the operations of Borrower's properties once during each
fiscal year of the Borrower, by independent environmental consultants chosen by
the Borrower and acceptable to the Required Lenders, which review shall, if
requested by such Lender or Lenders, be arranged and supervised by environmental
legal counsel for the Lenders, all at the Borrower's cost and expense. The
consultant shall render a verbal or written report, as specified by the Lenders,
based upon such review, at the Borrower's cost and expense;
(j) concurrently with the delivery of the financial statements
referred to in subsections 7.1(a) and (b), a throughput report setting forth the
throughputs of each pipeline owned by the Borrower or any Subsidiary of the
Borrower; and
(k) promptly, such additional financial and other information
concerning any Loan Party or any Joint Venture as any Lender may from time to
time reasonably request.
Section 7.3 Payment of Obligations. Pay, discharge or otherwise satisfy
at or before maturity or before they become delinquent, as the case may be, all
its obligations of whatever nature, except where the amount or validity thereof
is currently being contested in good faith by appropriate proceedings and
reserves in conformity with GAAP with respect thereto have been provided on the
books of the Borrower or its Subsidiaries, as the case may be, and except where
the failure to so pay, discharge or satisfy such obligations could not
reasonably be expected to have a Material Adverse Effect.
Section 7.4 Conduct of Business and Maintenance of Existence. Continue
to engage in business of the same general type as now conducted by it and
preserve, renew and keep in full force and effect its corporate existence and
take all reasonable action to maintain all rights, privileges and franchises
necessary or desirable in the normal conduct of its business; comply with all
Contractual Obligations and Requirements of Law except to the extent that
failure to comply therewith could not, in the aggregate, reasonably be expected
to have a Material Adverse Effect.
Section 7.5 Maintenance of Property; Insurance. Keep all property
useful and necessary in its business in good working order and condition;
maintain with financially sound and reputable insurance companies insurance on
all its property and its business in at least such amounts and against at least
such risks (but including in any event fire, casualty, public liability,
environmental liability and product liability) as are usually insured against in
the same general area by companies engaged in the same or a similar business;
and furnish to each Lender, upon written request, full information as to the
insurance carried. Upon demand by any Lender (by notice to the Administrative
Agent, which shall give notice of such demand to the Borrower and each Lender)
any insurance policies covering Collateral shall be endorsed to provide that
such policies may not be cancelled or reduced or affected in any material manner
for any reason without 15 days prior notice to the Lenders. The Borrower shall,
and shall cause each of its Subsidiaries to, at all times maintain liability and
other insurance in accordance with and in the amounts set forth on Schedule
5.22, which insurance shall be by financially sound and reputable insurers.
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Section 7.6 Inspection of Property; Books and Records; Discussions.
Keep proper books of records and accounts in which full, true and correct
entries in conformity with GAAP and all Requirements of Law shall be made of all
dealings and transactions in relation to its business and activities; and permit
representatives of any Lender to visit and inspect any of its properties and
examine and make abstracts from any of its books and records at any reasonable
time and as often as may reasonably be desired and to discuss the business,
operations, properties and financial and other condition of the Borrower and its
Subsidiaries with officers and employees of the Borrower and its Subsidiaries
and with its independent certified public accountants.
Section 7.7 Notices. Promptly give notice to the Administrative Agent
and each Lender of:
(a) the occurrence of any Default or Event of Default;
(b) any (i) default or event of default under any Contractual
Obligation of the Borrower or any of its Subsidiaries or (ii) litigation,
investigation or proceeding which may exist at any time between the Borrower or
any of its Subsidiaries and any Governmental Authority, which in either case, if
not cured or if adversely determined, as the case may be, could reasonably be
expected to have a Material Adverse Effect;
(c) any litigation or proceeding affecting the Borrower or any
of its Subsidiaries in which the amount involved is $1,000,000 or more and not
covered by insurance or in which injunctive or similar relief is sought;
(d) the following events, as soon as possible and in any event
within 30 days after the Borrower knows or has reason to know thereof: (i) the
occurrence or expected occurrence of any Reportable Event with respect to any
Plan, a failure to make any required contribution to a Plan, the creation of any
Lien in favor of the PBGC or a Plan or any withdrawal from, or the termination,
Reorganization or Insolvency of, any Multiemployer Plan or (ii) the institution
of proceedings or the taking of any other action by the PBGC or the Borrower or
any Commonly Controlled Entity or any Multiemployer Plan with respect to the
withdrawal from, or the terminating, Reorganization or Insolvency of, any Plan;
and
(e) any development or event which could reasonably be
expected to have a Material Adverse Effect or cause the incurrence of an
environmental liability in excess of the Material Environmental Amount.
Each notice pursuant to this Section shall be accompanied by a statement of a
Responsible Officer setting forth details of the occurrence referred to therein
and stating what action the Borrower proposes to take with respect thereto.
Section 7.8 Environmental Laws.
(a) Comply with, and ensure compliance by all tenants and
subtenants, if any, with, all applicable Environmental Laws and obtain and
comply with and maintain, and ensure that all tenants and subtenants obtain and
comply with and maintain, any and all licenses, approvals, notifications,
registrations or permits required by applicable Environmental Laws
61
except to the extent that failure to do so could not reasonably be expected to
have a Material Adverse Effect;
(b) Conduct and complete all investigations, studies, sampling
and testing, and all remedial, removal and other actions required under
Environmental Laws and promptly comply with all lawful orders and directives of
all Governmental Authorities regarding Environmental Laws except to the extent
that the same are being contested in good faith by appropriate proceedings and
the pendency of such proceedings could not reasonably be expected to have a
Material Adverse Effect; and
(c) Defend, indemnify and hold harmless the Administrative
Agent and the Lenders, and their respective employees, agents, officers and
directors, from and against any and all claims, demands, penalties, fines,
liabilities, settlements and damages, and reasonable costs and expenses, of
whatever kind or nature known or unknown, contingent or otherwise, arising out
of, or in any way relating to the violation of, noncompliance with or liability
under, any Environmental Law applicable to the operations of the Borrower, any
of its Subsidiaries or the Properties, or any orders, requirements or demands of
Governmental Authorities related thereto, including, without limitation,
attorney's and consultant's fees, investigation and laboratory fees, response
costs, court costs and litigation expenses, REGARDLESS OF WHETHER OR NOT SUCH
INDEMNIFIED LIABILITIES ARE IN ANY WAY OR TO ANY EXTENT CAUSED, IN WHOLE OR IN
PART, BY ANY NEGLIGENT ACT OR OMISSION OF THE PARTY SEEKING INDEMNIFICATION
THEREFORE; provided that the Borrower shall have no obligation hereunder to the
extent that any of the foregoing arise out of the gross negligence or willful
misconduct of the party seeking indemnification therefor. The agreements in this
paragraph shall survive repayment of all amounts payable hereunder.
Section 7.9 Maintenance of Liens of the Security Documents. Promptly,
upon the request of the Administrative Agent, at the Borrower's expense,
execute, acknowledge and deliver, or cause the execution, acknowledgement and
delivery of, and thereafter register, file or record, or cause to be registered,
filed or recorded, in an appropriate governmental office, any document or
instrument supplemental to or confirmatory of the Security Documents or
otherwise deemed by the Administrative Agent necessary or desirable for the
continued validity, perfection and priority of the Liens on the collateral
covered thereby.
Section 7.10 Pledge of After-Acquired Property.
(a) With respect to any right, title or interest of any Loan
Party in any Equity Interests or other property of a type subject to the
Security Documents and acquired after the Closing Date, promptly grant or cause
to be granted to the Administrative Agent, for the benefit of the Lenders, a
first Lien of record on all such Equity Interests and property (other than such
Equity Interests and property subject to (i) prior Liens in existence at the
time of acquisition thereof and not created in anticipation of such acquisition,
in which case the Lien of the Lenders shall be of such priority as is permitted
by such prior Lien and (ii) other Liens that are expressly permitted by this
Agreement), upon terms substantially the same as those set forth in the Security
Documents, and satisfy the conditions with respect thereto set forth in Section
6.1. The Borrower, at its own expense, shall execute, acknowledge and deliver,
or cause its Subsidiaries (other than MIAGS) to execute, acknowledge and
deliver, and thereafter register, file or record,
62
or cause its Subsidiaries (other than MIAGS) to register, file or record, in an
appropriate governmental office, any document or instrument deemed by the
Administrative Agent to be necessary or desirable for the creation and
perfection of the foregoing Liens and deliver Uniform Commercial Code searches
in jurisdictions requested by the Administrative Agent with respect to such
Equity Interests and other property and legal opinions requested by the
Administrative Agent and shall pay, or cause to be paid, all taxes and fees
related to such registration, filing or recording.
(b) With respect to any new Subsidiary created or acquired
after the Closing Date by the Borrower, promptly cause such Subsidiary to
execute and deliver to the Administrative Agent the Subsidiary Guarantee, and,
if requested by the Administrative Agent, deliver to the Administrative Agent
legal opinions relating to such Subsidiary and the Subsidiary Guarantee, which
opinions shall be in form and substance, and from counsel, reasonably
satisfactory to the Administrative Agent.
(c) Notwithstanding anything to the contrary in any Loan
Document, neither the Borrower nor any Subsidiary of the Borrower shall be
obligated to (i) pledge under the Loan Documents any of its Equity Interest in
any Joint Venture if such pledge is prohibited by any Contractual Obligation or
(ii) pledge under the Loan Documents any of its real property except to the
extent of any fixtures as and to the extent specified in the Security
Agreements.
(d) Notwithstanding anything to the contrary in any Loan
Document, if the Borrower or any Subsidiary of the Borrower has pledged its
interest in any Joint Venture and the Borrower or such Subsidiary desires to
make a contribution of or investment with such interest to or in a second Joint
Venture in accordance with subsection 8.8(f), the Lien held by the Lenders upon
such interest shall terminate as long as the interest held by the Borrower or
such Subsidiary in the second Joint Venture shall be subject to a Lien under the
Loan Documents in accordance with subsection 8.8(f) unless otherwise agreed by
the Required Lenders.
Section 7.11 Use of Proceeds. The Borrower will use the proceeds of the
Loans only as provided in Section 5.16.
Section 7.12 Ownership of Subsidiaries. The Borrower and its
Subsidiaries shall directly or indirectly own 100% of the Equity Interest of
each of their Subsidiaries other than MIAGS. The Borrower and its Subsidiaries
shall directly or indirectly own 83% of the Equity Interest of MIAGS.
Section 7.13 Joint Venture Charters. Deliver to the Administrative
Agent (a) any Joint Venture Charters of each Joint Venture any of the interests
in which is owned by a Subsidiary of the Borrower, (b) each credit agreement to
which any Joint Venture any of the interests in which is owed by a Subsidiary of
the Borrower is a party, in any case with all exhibits, schedules and disclosure
letters referred to therein or delivered pursuant thereto, if any, and all
amendments relating thereto, waivers relating thereto, and other side letters or
agreements affecting the terms thereof.
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ARTICLE VIII
NEGATIVE COVENANTS
The Borrower hereby agrees that, so long as any Commitment remains in
effect, or any Obligation remains outstanding and unpaid, the Borrower shall
not, and (except with respect to Section 8.1) shall not permit any of its
Subsidiaries to, directly or indirectly:
Section 8.1 Financial Condition Covenants.
(a) Interest Coverage Ratio. Permit for any Calculation Period
ending on or after June 30, 2002, the ratio of (i) Consolidated EBITDA for such
period to (ii) Consolidated Interest Expense for such period to be less than 2.5
to 1.0; or
(b) Leverage Ratio. Permit, on the last day of any fiscal
quarter of the Borrower, the ratio of (x) Consolidated Total Indebtedness at
such date to (y) the Consolidated EBITDA for the Calculation Period ending on
such date to exceed the ratio set forth opposite the period including such date
below:
Period Ratio
------ -----
Closing Date through and including December 31, 2002: 5.50:1.00
Thereafter, through and including June 30, 2003 5.00:1.00
Thereafter, through and including December 31, 2003: 4.50:1.00
Thereafter until the Termination Date: 4.00:1.00
Section 8.2 Limitation on Indebtedness. Create, incur, assume or suffer
to exist any Indebtedness, except:
(a) Indebtedness of the Borrower and its Subsidiaries under
the Loan Documents;
(b) Indebtedness of the Borrower to any Subsidiary of the
Borrower (other than MIAGS), and of any Subsidiary to the Borrower or any other
Subsidiary of the Borrower (other than MIAGS);
(c) Indebtedness permitted pursuant to Sections 8.3 and 8.8;
(d) Indebtedness incurred pursuant to any Hedge Agreement to
the extent permitted by Section 8.22;
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(e) other unsecured Indebtedness of the Borrower in an
aggregate principal amount not to exceed $5,000,000 outstanding at any time; and
(f) the Indian Basin Indebtedness, so long as such
Indebtedness continues to be Indebtedness of Indian Basin only and El Paso (or
any other lender thereunder) has no recourse against the Borrower or its other
Subsidiaries, and in any case only until (and including) the Additional Term
Loan Borrowing Date.
Section 8.3 Limitation on Liens. Create, incur, assume or suffer to
exist any Lien upon any of its property, assets or revenues, whether now owned
or hereafter acquired, except for:
(a) Liens for taxes not yet due or which are being contested
in good faith by appropriate proceedings, provided that adequate reserves with
respect thereto are maintained on the books of the Borrower or its Subsidiaries,
as the case may be, in conformity with GAAP;
(b) carriers', warehousemen's, mechanics', materialmen's,
repairmen's or other like Liens arising in the ordinary course of business which
are not overdue for a period of more than 60 days or which are being contested
in good faith by appropriate proceedings;
(c) pledges or deposits in connection with workers'
compensation, unemployment insurance and other social security legislation and
deposits securing liability to insurance carriers under insurance or
self-insurance arrangements;
(d) deposits to secure the performance of bids, trade
contracts (other than for borrowed money), leases, statutory obligations, surety
and appeal bonds, performance bonds and other obligations of a like nature
incurred in the ordinary course of business;
(e) easements, rights-of-way, restrictions and other similar
encumbrances incurred in the ordinary course of business which, in the
aggregate, are not substantial in amount and which do not in any case materially
detract from the value of the property subject thereto or materially interfere
with the ordinary conduct of the business of the Borrower or such Subsidiary;
(f) Liens created pursuant to construction, operating,
maintenance agreements, space lease agreements, Joint Venture Charters and
related documents (to the extent requiring a Lien on the equity interest of the
Borrower or its Subsidiary, as the case may be, in the applicable Joint Venture
is required thereunder), division orders, contracts for sale, transportation or
exchange of oil and natural gas, unitization and pooling declarations and
agreements, area of mutual interest agreements and other similar agreements, in
each case having ordinary and customary terms and entered into in the ordinary
course of business by the Borrower and its Subsidiaries;
(g) additional Liens securing Indebtedness and other
obligations not to exceed $500,000 at any one pursuant to the time outstanding;
and
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(h) Liens created Loan Documents.
This Section 8.3 shall not restrict the ability of any Joint Venture to create,
incur, assume or suffer to exist any Lien on any of its property.
Section 8.4 Limitation on Guarantee Obligations. Create, incur, assume
or suffer to exist any Guarantee Obligation except:
(a) Guarantee Obligations created pursuant to the Loan
Documents;
(b) Guarantee Obligations of the Borrower or any Subsidiary of
the Borrower (other than MIAGS) incurred after the Closing Date in an aggregate
amount not to exceed $1,000,000 at any one time outstanding; and
(c) Guarantee Obligations constituting performance guarantees
provided in the ordinary course of business by the Borrower and its Subsidiaries
supporting obligations of the Borrower and/or its Subsidiaries (other than
MIAGS) which obligations have been incurred in the ordinary course of business
(including in connection with the operation, construction or acquisition of
pipelines, platforms and related facilities).
Section 8.5 Limitations on Fundamental Changes. Enter into any merger,
consolidation or amalgamation, or liquidate, wind up or dissolve itself (or
suffer any liquidation or dissolution), or make any material change in its
present method of conducting business, except:
(a) any Subsidiary may be merged or consolidated with or into
the Borrower (as long as the Borrower is the surviving entity) or any one or
more Subsidiaries of the Borrower which is a Subsidiary Guarantor;
(b) any Subsidiary of the Borrower may sell, lease, transfer
or otherwise dispose of any or all of its assets (upon voluntary liquidation or
otherwise) to the Borrower or any other Subsidiary of the Borrower (other than
MIAGS); and
(c) solely to effect any transaction permitted by subsection
8.6(b).
The transactions permitted under this Section 8.5 shall be permitted
notwithstanding anything to the contrary in subsection 4(j) of each of the
Borrower Pledge Agreement, the Subsidiary Pledge Agreement and the Parent Pledge
Agreement.
Section 8.6 Limitation on Sale of Assets. Convey, sell, lease, assign,
transfer or otherwise dispose of any of its property, business or assets
(including, without limitation, receivables and leasehold interests), whether
now owned or hereafter acquired, except:
(a) as permitted by Section 8.5;
(b) as long as no Default or Event of Default has occurred and
is continuing or would result therefrom, the Borrower and the Subsidiaries of
the Borrower may sell or otherwise
66
dispose of property in any fiscal year having an aggregate value not in excess
of 5% of Consolidated Tangible Net Worth calculated on the last day of the prior
fiscal quarter;
(c) any sale or other disposition to the Borrower or any
Subsidiary Guarantor; and
(d) as permitted by Section 8.8.
The transactions permitted under this Section 8.6 shall be permitted
notwithstanding anything to the contrary in subsection 4(j) of each of the
Borrower Pledge Agreement, the Subsidiary Pledge Agreement and the Parent Pledge
Agreement.
Section 8.7 Limitation on Dividends. Declare or pay any dividend or
distribution on, or make any payment on account of, or set apart assets for a
sinking or other analogous fund for, the purchase, redemption, defeasance,
retirement or other acquisition of, any Equity Interest of the Borrower or any
warrants or options to purchase any such Equity Interest, whether now or
hereafter outstanding, or make any other distribution in respect thereof, either
directly or indirectly, whether in cash or property or in obligations of the
Borrower or any Subsidiary of the Borrower (such declarations, payments, setting
apart, purchases, redemptions, defeasances, retirements, acquisitions and
distributions being herein called "Restricted Payments"), except that as long as
(x) no Default or Event of Default has occurred and is continuing or would
result therefrom and (y) the Leverage Ratio as of the last day of the most
recently ended Calculation Period is equal to or less than 4.00:1.00 and such
Calculation Period ended on or after June 30, 2002, the Borrower may make
Restricted Payments during the fiscal quarter immediately following such most
recently ended Calculation Period consisting of cash distributions in an amount
not to exceed 75% of Consolidated EBITDA for the fiscal quarter ending on the
immediately preceding Quarterly Date.
Section 8.8 Limitation on Investments, Loans and Advances. Make any
advance, loan, extension of credit or capital contribution to, or purchase any
stock, bonds, notes, debentures or other securities of or any assets
constituting a business unit of, or make any other investment in, any Person,
except:
(a) extensions of trade credit in the ordinary course of
business;
(b) investments in Cash Equivalents;
(c) capital contributions, loans or other investments made by
the Borrower to any Subsidiary of the Borrower which is a Subsidiary Guarantor
and by any Subsidiary of the Borrower to the Borrower or any Subsidiary of the
Borrower which is a Subsidiary Guarantor;
(d) capital contributions, loans or other investments by
Subsidiaries of the Borrower or any Joint Venture to or in the Borrower or any
Subsidiary of the Borrower which is a Subsidiary Guarantor, provided that no
Default or Event of Default shall have occurred and be continuing, or would
occur as a result of such investment;
(e) so long as the Leverage Ratio as of the last day of the
most recently ended Calculation Period is equal to or less than 4.00:1.00, other
non-hostile acquisitions of equity
67
securities of, or assets constituting a business unit of, any Person (an
"Acquired Business"), provided that (i) immediately prior to and after giving
effect to any such acquisition, no Default or Event of Default shall have
occurred or be continuing (whether under Section 8.17 or otherwise), (ii) such
acquisition is consummated in accordance with applicable law, (iii) if such
acquisition is of equity securities of a Person, such Person becomes a
Subsidiary Guarantor and the Borrower otherwise complies with Section 8.17, (iv)
the Borrower shall be in pro forma compliance with the covenants set forth in
Section 8.1 after giving effect to such acquisition and (v) the Acquired
Business shall not be subject to any material liabilities which would be
expressly prohibited by this Agreement after such acquisition;
(f) the contribution by the Borrower or any Subsidiary of the
Borrower of the equity interests owned by it in a Joint Venture to another Joint
Venture or the investment by the Borrower or any Subsidiary of the Borrower in
another Joint Venture to the extent made with equity interests in a Joint
Venture owned by it as long as (i) the Borrower or such Subsidiary receives in
exchange equity interests in such transferee Joint Venture and (ii) unless
otherwise agreed by the Required Lenders, if the transferred equity interests
are subject to a Lien under the Loan Documents, the equity interests received in
exchange become subject to a Lien under the Loan Documents;
(g) capital contributions or other investments made by the
Borrower or its Subsidiaries pursuant to the Acquisition; and
(h) capital contributions, loans or other investments, in
addition to those otherwise permitted by subsections 8.8(a) through (g), in an
aggregate amount not to exceed (i) $10,000,000 so long as (before and after
giving effect to such capital contributions, loans or other investments) the
Leverage Ratio as of the last day of the most recently ended Calculation Period
is less than or equal to 4.00:1.00, or (ii) $1,000,000 otherwise, during any
fiscal year of the Borrower beginning with the fiscal year commencing on January
1, 2002. For the avoidance of doubt, any fluctuation of the Leverage Ratio above
4.00:1.00 during a given fiscal year in which aggregate investments complying
with this subsection 8.8(h) have previously exceeded $1,000,000 shall result in
no further investments being permitted pursuant to this subsection 8.8(h) until
the Leverage Ratio as of the last day of the most recently ended Calculation
Period falls to or below 4.00:1.00 but shall not independently result in
non-compliance with this exception.
Section 8.9 Limitation on Modifications of Certain Agreements.
(a) Make any optional payment or prepayment on, redemption of
or purchase of, or voluntarily defease, or directly or indirectly voluntarily or
optionally purchase, redeem, retire or otherwise acquire, any Indebtedness or
Guarantee Obligations (other than the Loans), except for such actions relating
to the prepayment of the Indian Basin Indebtedness, (b) amend, modify or change,
or consent or agree to any amendment, modification or change to, any of the
terms of any Indebtedness or Guarantee Obligations (other than any such
amendment, modification or change which would extend the maturity or reduce the
amount of any payment of principal thereof or which would reduce the rate or
extend the date for payment of interest thereon), except to the extent the same
could not reasonably be expected to have a Material Adverse Effect or the same
are accomplished to allow for prepayment of the Indian Basin
68
Indebtedness, (c) amend, modify or change, or consent to any amendment,
modification or change to, any of the terms of the Partnership Agreement, the
Borrower's certificate of limited partnership or any Joint Venture Charter,
except to the extent the same could not reasonably be expected to have a
Material Adverse Effect, or (d) waive or otherwise relinquish any of its rights
or causes of action arising out of the Partnership Agreement, the Borrower's
certificate of limited partnership or any Joint Venture Charter, except to the
extent the same could not reasonably be expected to have a Material Adverse
Effect. Notwithstanding any provision contained in this Section 8.9, the
Borrower and its Subsidiaries shall have the absolute right to amend any Joint
Venture Charter to the extent necessary or reasonably appropriate to evidence
the substitution, replacement or other changes of partners, members or owners in
any Joint Venture not in violation of Section 8.19 or Section 8.21
Section 8.10 Limitation on Transactions with Affiliates. Subject to the
rights set forth in Section 8.13, enter into any transaction, including, without
limitation, any purchase, sale, lease or exchange of property or the rendering
of any service, with any Affiliate unless such transaction is (a) otherwise
permitted under this Agreement, and (b) upon fair and reasonable terms no less
favorable to the Borrower or such Subsidiary of the Borrower, as the case may
be, than it would obtain in a comparable arm's length transaction with a Person
which is not an Affiliate.
Section 8.11 Limitation on Sales and Leasebacks. Enter into any
arrangement with any Person providing for the leasing by the Borrower or any
Subsidiary of the Borrower of real or personal property which has been or is to
be sold or transferred by the Borrower or such Subsidiary of the Borrower to
such Person or to any other Person to whom funds have been or are to be advanced
by such Person on the security of such property or rental obligations of the
Borrower or such Subsidiary of the Borrower.
Section 8.12 Limitation on Changes in Fiscal Year. Permit the fiscal
year of the Borrower to end on a day other than December 31.
Section 8.13 Limitation on Lines of Business. Enter into any business,
either directly or through any Subsidiary or Joint Venture, except for (a)
gathering, transporting (by barge, pipeline, ship, truck or other modes of
hydrocarbon transportation), terminalling, storing, acquiring, processing,
dehydrating, fractionating and otherwise handling hydrocarbons, including,
without limitation, constructing pipeline, platform, dehydration, processing and
other energy-related facilities, and activities or services reasonably related
or ancillary thereto and (b) other businesses as long as the consolidated total
assets principally relating to such other businesses do not exceed 3% of the
consolidated total assets of the Borrower and its Subsidiaries at any time.
Section 8.14 Governing Documents. Permit the amendment or modification
of the limited liability company agreement, limited partnership agreement, or
equivalent governance document, or certificate of limited partnership,
certificate of formation, or equivalent formation document, as the case may be,
of any Subsidiary of the Borrower if such amendment could reasonably be expected
to have a Material Adverse Effect, or would authorize or issue any Equity
Interests not authorized or issued on the Closing Date, except to the extent
such
69
authorization or issuance would have the same substantive effect as any
transaction permitted by Section 8.5 or 8.6.
Section 8.15 Compliance with ERISA.
(a) Terminate any Plan so as to result in any material
liability to PBGC, (b) engage in any "prohibited transaction" (as defined in
Section 4975 of the Code) involving any Plan which could result in a material
liability for an excise tax or civil penalty in connection therewith, (c) incur
or suffer to exist any material "accumulated funding deficiency" (as defined in
Section 302 of ERISA), whether or not waived involving any Plan, or (d) allow or
suffer to exist any event or condition, which presents a material risk of
incurring a material liability to PBGC by reason of termination of any such
Plan.
Section 8.16 Limitation on Restrictions Affecting Subsidiaries. Enter
into, or suffer to exist, any agreement with any Person, other than the Lenders
pursuant hereto or which exist on the Closing Date, which prohibits or limits
the ability of any Subsidiary of the Borrower to (a) pay dividends or make other
distributions or pay any Indebtedness owed to the Borrower or any Subsidiary of
the Borrower, (b) make loans or advances to or make other investments in the
Borrower or any Subsidiary of the Borrower, (c) transfer any of its properties
or assets to the Borrower or any Subsidiary of the Borrower, (d) create, incur,
assume or suffer to exist any Lien upon any of its property, assets or revenues,
whether now owned or hereafter acquired.
Section 8.17 Creation of Subsidiaries. Create or acquire any new
Subsidiary of the Borrower or any of its Subsidiaries, unless, immediately upon
the creation or acquisition of any such Subsidiary, (a) such Subsidiary shall
become party to the Subsidiaries Guarantee as a Subsidiary Guarantor pursuant to
an addendum thereto or other documentation in form and substance reasonably
satisfactory to the Administrative Agent, (b) such Subsidiary shall become party
to the Subsidiary Security Agreement as a grantor pursuant to an addendum
thereto or other documentation in form and substance reasonably satisfactory to
the Administrative Agent, and all actions required to perfect the Liens granted
thereby, all filings required thereunder and all consents necessitated thereby
shall have been taken, made or obtained, (c) all Equity Interests issued by such
Subsidiary shall have been pledged to the Administrative Agent pursuant to an
addendum or amendment to the Borrower Pledge Agreement, the Subsidiary Pledge
Agreement or other documentation in form and substance satisfactory to the
Administrative Agent, (d) all corporate, company, partnership or other
proceedings, and all documents, instruments and other legal matters in
connection with the creation of such Subsidiary and the transactions
contemplated by this Section 8.17 shall be reasonably satisfactory in form and
substance to the Administrative Agent, and the Administrative Agent shall have
received such other documents and legal opinions in respect of any aspect or
consequence of such creation or such transactions as it shall reasonably request
and (e) no Default or Event of Default shall have occurred and be continuing
after giving effect thereto.
Section 8.18 Hazardous Materials. Except to the extent that the same
could not reasonably be expected to have a Material Adverse Effect, permit the
manufacture, storage, transmission or presence of any Hazardous Materials over
or upon any of its properties except in accordance with all applicable
Requirements of Law or release, discharge or otherwise dispose of any Hazardous
Materials on any of its properties except that the Borrower and its Subsidiaries
70
may treat, store and transport petroleum, its derivatives, by-products and other
hydrocarbons, hydrogen sulfide and sulfur dioxide in the ordinary course of
their business.
Section 8.19 Holding Companies. Notwithstanding any other provisions of
this Agreement and the other Loan Documents, permit any Subsidiary of the
Borrower which is a general partner in or owner of a general partnership
interest in a Joint Venture to incur or suffer to exist any obligations or
indebtedness of any kind, whether contingent or fixed (excluding any contingent
liability of such Subsidiary to creditors of such Joint Venture arising solely
as a result of its status as a general partner or owner of such Joint Venture)
or create or suffer to exist any Liens, in each case except to the extent any
such obligations, indebtedness or Liens arise under or pursuant to the Joint
Venture Charter for such Joint Venture as in effect on the date of acquisition
or formation of such Joint Venture, or the Loan Documents or are otherwise
permitted by the Loan Documents; or permit any Subsidiary of the Borrower which
is a general partner in or owner of a general partnership interest in a Joint
Venture to acquire any property or asset after the Closing Date (or, if later,
the date of acquisition or formation of such Joint Venture) except for
distributions made to it by such Joint Venture; or permit any Subsidiary of the
Borrower which is a general partner in or owner of a general partnership
interest in a Joint Venture to engage in any business or activity other than
holding the general partnership interest in (or other ownership interest) such
Joint Venture held by it on the Closing Date (or, if later, the date of
formation of such Joint Venture).
Section 8.20 No Voluntary Termination of Joint Venture Charters. Permit
any Subsidiary of the Borrower which is a partner in, or owner of any interest
in, any Joint Venture to voluntarily terminate any Joint Venture Charter and
liquidate such Joint Venture to the extent permitted thereunder.
Section 8.21 Actions by Joint Ventures. (a) Consent or agree to or
acquiesce in any Joint Venture the interests in which are owned by a Subsidiary
of the Borrower adversely changing its policy of making distributions of
available cash to partners, or (b) so long as any interest therein is owned by a
Subsidiary of the Borrower, consent or agree to or acquiesce in any Joint
Venture's taking any actions that could reasonably be expected to have a
Material Adverse Effect.
Section 8.22 Hedging Transactions. Enter into any interest rate,
cross-currency, commodity, equity or other security, swap, collar or similar
hedging agreement or purchase any option to purchase or sell or to cap any
interest rate, cross-currency, commodity, equity or other security, in any such
case, other than to hedge risk exposures in the operation of its business,
ownership of assets or the management of its liabilities.
ARTICLE IX
EVENTS OF DEFAULT
If any of the following events shall occur and be continuing:
(a) The Borrower shall fail to pay any principal of any Loan
or any Reimbursement Obligation which is not funded by a Loan when due in
accordance with the
71
terms thereof or hereof; or the Borrower shall fail to pay any interest on any
Loan, or any other amount payable hereunder, within five days after any such
interest or other amount becomes due in accordance with the terms thereof or
hereof; or
(b) Any representation or warranty made or deemed made by the
Borrower or any other Loan Party herein or in any other Loan Document or which
is contained in any certificate, document or financial or other statement
furnished at any time under or in connection with this Agreement shall prove to
have been incorrect in any material respect on or as of the date made or deemed
made; or
(c) The Borrower shall default in the observance or
performance of any agreement contained in Article VIII (other than subsection
8.1(a)) or in Section 7.11; or any Loan Party shall default in the observance or
performance of any agreement contained in Section 5(g), (h), (i), or (n) of the
Borrower Security Agreement, Section 5(h), (i), (j), or (o) of the Subsidiary
Security Agreement, or Section 5(b) of the Borrower Pledge Agreement, the
Subsidiary Pledge Agreement or the Parent Pledge Agreement; or the Borrower
shall default in the observance or performance of any agreement contained in
subsection 8.1(a) and such default shall continue uncured for a period of 15
days; or
(d) The Borrower or any other Loan Party shall default in the
observance or performance of any other agreement contained in this Agreement or
any other Loan Document (other than as provided in paragraphs (a) through (c) of
this Section), and such default shall continue unremedied for a period of 30
days after receipt of written notice thereof from the Administrative Agent or
any Lender; or
(e) (i) Any Loan Party or any Subsidiary of the Borrower shall
(A) default in any payment of principal of or interest on any Indebtedness
(other than the Loans) or in the payment of any Guarantee Obligation, beyond the
period of grace (not to exceed 30 days), if any, provided in the instrument or
agreement under which such Indebtedness or Guarantee Obligation was created; or
(B) default in the observance or performance of any other agreement or condition
relating to any such Indebtedness or Guarantee Obligation or contained in any
instrument or agreement evidencing, securing or relating thereto, or any other
event shall occur or condition exist, the effect of which default or other event
or condition is to cause, or to permit the holder or holders of such
Indebtedness or beneficiary or beneficiaries of such Guarantee Obligation (or a
trustee or agent on behalf of such holder or holders or beneficiary or
beneficiaries) to cause, with the giving of notice if required, such
Indebtedness to become due prior to its stated maturity or such Guarantee
Obligation to become payable; provided, however, that the aggregate principal
amount of Indebtedness and Guarantee Obligations with respect to which such
defaults shall have occurred shall equal or exceed $1,000,000; or
(ii) Regarding Indebtedness and Guarantee Obligations of EPN,
the holder or holders of any such Indebtedness or beneficiary or beneficiaries
of any such Guarantee Obligation shall cause, with the giving of notice if
required, such Indebtedness to become due prior to its stated maturity or such
Guarantee Obligation to become payable; provided, however, that the aggregate
principal amount of Indebtedness and Guarantee Obligations of EPN with respect
to which such action shall have occurred shall equal or exceed $5,000,000.
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(f) (i) Any Loan Party or EPN shall commence any case,
proceeding or other action (A) under any existing or future law of any
jurisdiction, domestic or foreign, relating to bankruptcy, insolvency,
reorganization or relief of debtors, seeking to have an order for relief entered
with respect to it, or seeking to adjudicate it a bankrupt or insolvent, or
seeking reorganization, arrangement, adjustment, winding-up, liquidation,
dissolution, composition or other relief with respect to it or its debts, or (B)
seeking appointment of a receiver, trustee, custodian, conservator or other
similar official for it or for all or any substantial part of its assets, or any
Loan Party or EPN shall make a general assignment for the benefit of its
creditors; or (ii) there shall be commenced against any Loan Party or EPN any
case, proceeding or other action of a nature referred to in clause (i) above
which (A) results in the entry of an order for relief or any such adjudication
or appointment or (B) remains undismissed, undischarged or unbonded for a period
of 60 days; or (iii) there shall be commenced against any Loan Party or EPN any
case, proceeding or other action seeking issuance of a warrant of attachment,
execution, distraint or similar process against all or any substantial part of
its assets which results in the entry of an order for any such relief which
shall not have been vacated, discharged, or stayed or bonded pending appeal
within 60 days from the entry thereof; or (iv) any Loan Party or EPN shall take
any action in furtherance of, or indicating its consent to, approval of, or
acquiescence in, any of the acts set forth in clause (i), (ii), or (iii) above;
or (v) any Loan Party or EPN shall generally not, or shall be unable to, or
shall admit in writing its inability to, pay its debts as they become due; or
(g) (i) Any Person shall engage in any "prohibited
transaction" (as defined in Section 406 of ERISA or Section 4975 of the Code)
involving any Plan, (ii) any "accumulated funding deficiency" (as defined in
Section 302 of ERISA), whether or not waived, shall exist with respect to any
Plan or any Lien in favor of the PBGC or a Plan shall arise on the assets of the
Borrower or any Commonly Controlled Entity, (iii) a Reportable Event shall occur
with respect to, or proceedings shall commence to have a trustee appointed, or a
trustee shall be appointed, to administer or to terminate, any Single Employer
Plan, which Reportable Event or commencement of proceedings or appointment of a
trustee is, in the reasonable opinion of the Required Lenders, likely to result
in the termination of such Plan for purposes of Title IV of ERISA, (iv) any
Single Employer Plan shall terminate for purposes of Title IV of ERISA, (v) the
Borrower or any Commonly Controlled Entity shall, or in the reasonable opinion
of the Required Lenders is likely to, incur any liability in connection with a
withdrawal from, or the Insolvency or Reorganization of, a Multiemployer Plan or
(vi) any other event or condition shall occur or exist with respect to a Plan;
and in each case in clauses (i) through (vi) above, such event or condition,
together with all other such events or conditions, if any, could have a Material
Adverse Effect; or
(h) One or more judgments or decrees shall be entered against
the Borrower or any of its Subsidiaries involving in the aggregate a liability
(not paid or fully covered by insurance) of $1,000,000 or more, and all such
judgments or decrees shall not have been vacated, discharged, stayed or bonded
pending appeal within 60 days from the entry thereof; or
(i) If at any time the Borrower or any Subsidiary of the
Borrower shall become liable for remediation and/or environmental compliance
expenses and/or fines, penalties or other charges which, in the aggregate, are
in excess of the Material Environmental Amount for any Loan Party and the
Subsidiaries of the Borrower; or
73
(j) For any reason (other than any act on the part of the
Administrative Agent or the Lenders) any Security Document or any Guarantee
ceases to be in full force and effect or any party thereto (other than the
Administrative Agent or the Lenders) shall so assert in writing or the Lien
intended to be created by any Security Document ceases to be or is not a valid
and perfected Lien having the priority contemplated thereby; or
(k) (i) The Borrower shall cease to own, directly or
indirectly, legally and beneficially (A) all of the Equity Interest in each
Subsidiary of the Borrower (whether becoming a Subsidiary of the Borrower
before, on or after the Closing Date) other than MIAGS, and (B) 83% of the
Equity Interest in MIAGS; or (ii) EPN shall cease to own, directly or
indirectly, legally and beneficially all of the Equity Interests of the
Borrower; or
(l) The Consolidated EBITDA shown in the financial statements
delivered pursuant to Section 7.1(c) varies from the Consolidated EBITDA shown
in the financial statements and Projections delivered pursuant to Section 6.1(w)
and such variation has had or could reasonably be expected to have a Material
Adverse Effect; or
(m) Any Person that owns an equity interest in any Joint
Venture shall exercise its rights and remedies (other than dilution of the
equity interests owned by the Borrower and its Subsidiaries in any Joint Venture
pursuant to contractual dilution provisions existing with respect to the Joint
Ventures) with respect to its Lien on any equity interest in such Joint Venture
the equity interest in which has been pledged to such Person; provided that in
the case of clause (ii), the amount of claims secured by such Lien shall equal
or exceed $1,000,000 and such claim shall not have been vacated, discharged,
stayed or bonded pending appeal within 30 days from the entry thereof;
then, and in any such event, (A) if such event is an Event of Default specified
in clause (i) or (ii) of paragraph (f) above with respect to the Borrower,
automatically the Commitments shall immediately terminate and the Loans
hereunder (with accrued interest thereon) and all other amounts owing under this
Agreement (including, without limitation, all amounts of L/C Obligations,
whether or not the beneficiaries of the then outstanding Letters of Credit shall
have presented the documents required thereunder) and the Loans shall
immediately become due and payable, and (B) if such event is any other Event of
Default, either or both of the following actions may be taken: (i) with the
consent of the Required Lenders, the Administrative Agent may, or upon the
request of the Required Lenders, the Administrative Agent shall, by notice to
the Borrower declare the Commitments to be terminated forthwith, whereupon the
Commitments shall immediately terminate; and (ii) with the consent of the
Required Lenders, the Administrative Agent may, or upon the request of the
Required Lenders, the Administrative Agent shall, by notice to the Borrower,
declare the Loans hereunder (with accrued interest thereon) and all other
amounts owing under this Agreement (including, without limitation, all amounts
of L/C Obligations, whether or not the beneficiaries of the then outstanding
Letters of Credit shall have presented the documents required thereunder) and
the Loans to be due and payable forthwith, whereupon the same shall immediately
become due and payable. If any L/C Obligations shall remain outstanding at the
time of an acceleration pursuant to the preceding sentence, the Borrower shall
at such time Cover the full amount of such outstanding L/C Obligations. The
Borrower shall execute and deliver to the Administrative Agent, for the account
of the Issuing Bank and the Lenders, such further documents and instruments as
the
74
Administrative Agent may request to evidence the creation and perfection of the
within security interest in such cash collateral account. Except as expressly
provided above in this Section, presentment, demand, protest, notice of intent
to accelerate, notice of acceleration and all other notices of any kind are
hereby expressly waived.
ARTICLE X
THE ADMINISTRATIVE AGENT
Section 10.1 Appointment. Each Lender hereby irrevocably designates and
appoints JPMorgan Chase Bank as the Administrative Agent of such Lender under
this Agreement and the other Loan Documents, and each such Lender irrevocably
authorizes JPMorgan Chase Bank, as the Administrative Agent for such Lender, to
take such action on its behalf under the provisions of this Agreement and the
other Loan Documents and to exercise such powers and perform such duties as are
expressly delegated to the Administrative Agent by the terms of this Agreement
and the other Loan Documents, together with such other powers as are reasonably
incidental thereto. Notwithstanding any provision to the contrary elsewhere in
this Agreement, the Administrative Agent shall not have any duties or
responsibilities, except those expressly set forth herein, or any fiduciary
relationship with any Lender, and no implied covenants, functions,
responsibilities, duties, obligations or liabilities shall be read into this
Agreement or any other Loan Document or otherwise exist against the
Administrative Agent.
Section 10.2 Delegation of Duties. The Administrative Agent may execute
any of its duties under this Agreement and the other Loan Documents by or
through agents or attorneys-in-fact and shall be entitled to advice of counsel
concerning all matters pertaining to such duties. The Administrative Agent shall
not be responsible for the negligence or misconduct of any agents or attorneys
in-fact selected by it with reasonable care.
Section 10.3 Exculpatory Provisions. Neither the Administrative Agent
nor any of its officers, directors, employees, agents, attorneys-in-fact or
Affiliates shall be (i) liable for any action lawfully taken or omitted to be
taken by it or such Person under or in connection with this Agreement or any
other Loan Document (except for its or such Person's own gross negligence or
willful misconduct) or (ii) responsible in any manner to any of the Lenders for
any recitals, statements, representations or warranties made by the Borrower or
any officer thereof contained in this Agreement or any other Loan Document or in
any certificate, report, statement or other document referred to or provided for
in, or received by the Administrative Agent under or in connection with, this
Agreement or any other Loan Document or for the value, validity, effectiveness,
genuineness, enforceability or sufficiency of this Agreement or any other Loan
Document or for any failure of the Borrower to perform its obligations hereunder
or thereunder. The Administrative Agent shall not be under any obligation to any
Lender to ascertain or to inquire as to the observance or performance of any of
the agreements contained in, or conditions of, this Agreement or any other Loan
Document, or to inspect the properties, books or records of the Borrower.
Section 10.4 Reliance by Administrative Agent. The Administrative Agent
shall be entitled to rely, and shall be fully protected in relying, upon any
Note, writing, resolution, notice, consent, certificate, affidavit, letter,
telecopy, telex or teletype message, statement, order or other
75
document or conversation believed by it to be genuine and correct and to have
been signed, sent or made by the proper Person or Persons and upon advice and
statements of legal counsel (including, without limitation, counsel to the
Borrower), independent accountants and other experts selected by the
Administrative Agent. The Administrative Agent may deem and treat the payee of
any Note as the owner thereof for all purposes unless a written notice of
assignment, negotiation or transfer thereof shall have been filed with the
Administrative Agent. The Administrative Agent shall be fully justified in
failing or refusing to take any action under this Agreement or any other Loan
Document unless it shall first receive such advice or concurrence of the
Required Lenders as it deems appropriate or it shall first be indemnified to its
satisfaction by the Lenders against any and all liability and expense which may
be incurred by it by reason of taking or continuing to take any such action. The
Administrative Agent shall in all cases be fully protected in acting, or in
refraining from acting, under this Agreement and the other Loan Documents in
accordance with a request of the Required Lenders, and such request and any
action taken or failure to act pursuant thereto shall be binding upon all the
Lenders.
Section 10.5 Notice of Default. The Administrative Agent shall not be
deemed to have knowledge or notice of the occurrence of any Default or Event of
Default hereunder unless the Administrative Agent has received notice from a
Lender or the Borrower referring to this Agreement, describing such Default or
Event of Default and stating that such notice is a "notice of default". In the
event that the Administrative Agent receives such a notice, the Administrative
Agent shall give notice thereof to the Lenders. The Administrative Agent shall
take such action with respect to such Default or Event of Default as shall be
reasonably directed by the Required Lenders; 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 or Event of Default as it shall
deem advisable in the best interests of the Lenders.
Section 10.6 Non-Reliance on Administrative Agent and Other Lenders.
Each Lender expressly acknowledges that neither the Administrative Agent nor any
of its officers, directors, employees, agents, attorneys-in-fact or Affiliates
has made any representations or warranties to it and that no act by the
Administrative Agent hereafter taken, including any review of the affairs of the
Borrower, shall be deemed to constitute any representation or warranty by the
Administrative Agent to any Lender. Each Lender represents to the Administrative
Agent that it has, independently and without reliance upon the Administrative
Agent or any other Lender, and based on such documents and information as it has
deemed appropriate, made its own appraisal of and investigation into the
business, operations, property, financial and other condition and
creditworthiness of the Borrower and made its own decision to make its Loans
hereunder and enter into this Agreement. Each Lender also represents that it
will, independently and without reliance upon the Administrative Agent or any
other Lender, and based on such documents and information as it shall deem
appropriate at the time, continue to make its own credit analysis, appraisals
and decisions in taking or not taking action under this Agreement and the other
Loan Documents, and to make such investigation as it deems necessary to inform
itself as to the business, operations, property, financial and other condition
and creditworthiness of the Borrower. Except for notices, reports and other
documents expressly required to be furnished to the Lenders by the
Administrative Agent hereunder, the Administrative Agent shall not have any duty
or responsibility to provide any Lender with any credit or other information
concerning the business, operations, property, condition (financial or
otherwise), prospects or creditworthiness
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of the Borrower which may come into the possession of the Administrative Agent
or any of its officers, directors, employees, agents, attorneys-in-fact or
Affiliates.
Section 10.7 Indemnification. The Lenders agree to indemnify the
Administrative Agent in its capacity as such (to the extent not reimbursed by
the Borrower and without limiting the obligation of the Borrower to do so),
ratably according to their respective Total Credit Percentages in effect on the
date on which indemnification is sought under this Section, from and against any
and all liabilities, obligations, losses, damages, penalties, actions,
judgments, suits, costs, expenses or disbursements of any kind whatsoever which
may at any time (including, without limitation, at any time following the
payment of the Loans) be imposed on, incurred by or asserted against the
Administrative Agent in any way relating to or arising out of this Agreement,
any of the other Loan Documents or any documents contemplated by or referred to
herein or therein or the transactions contemplated hereby or thereby or any
action taken or omitted by the Administrative Agent under or in connection with
any of the foregoing; provided that no Lender shall be liable for the payment of
any portion of such liabilities, obligations, losses, damages, penalties,
actions, judgments, suits, costs, expenses or disbursements resulting from the
Administrative Agent's gross negligence or willful misconduct. The agreements in
this Section 10.7 shall survive the payment of the Loans and all other amounts
payable hereunder.
Section 10.8 Administrative Agent in Its Individual Capacity. The
Administrative Agent and its Affiliates may make loans to, accept deposits from
and generally engage in any kind of business with the Borrower as though the
Administrative Agent were not the Administrative Agent hereunder and under the
other Loan Documents. With respect to its Loans made or renewed by it and any
Note issued to it and with respect to the Letters of Credit, the Administrative
Agent shall have the same rights and powers under this Agreement and the other
Loan Documents as any Lender and may exercise the same as though it were not the
Administrative Agent. The terms "Lender," "Lenders," `Revolving Credit Lenders,"
"Term Loan Lenders," and similar terms shall include the Administrative Agent in
its individual capacity.
Section 10.9 Successor Administrative Agent. The Administrative Agent
may resign as Administrative Agent upon 10 days' written notice to the Lenders.
If the Administrative Agent shall resign as Administrative Agent under this
Agreement and the other Loan Documents, then the Required Lenders shall appoint
from among the Lenders a successor agent for the Lenders, which successor agent
shall be approved by the Borrower, whereupon such successor agent shall succeed
to the rights, powers and duties of the Administrative Agent, and the term
"Administrative Agent" shall mean such successor agent effective upon such
appointment and approval, and the former Administrative Agent's rights, powers
and duties as Administrative Agent shall be terminated, without any other or
further act or deed on the part of such former Administrative Agent or any of
the parties to this Agreement. After any retiring Administrative Agent's
resignation as Administrative Agent, the provisions of this Section shall inure
to its benefit as to any actions taken or omitted to be taken by it while it was
Administrative Agent under this Agreement and the other Loan Documents.
Section 10.10 Other Agents. None of the Lenders identified on the cover
page or the preamble of this Agreement as a "co-syndication agent" or a
"co-documentation agent" shall have any right, power, obligation, liability,
responsibility or duty under this Agreement other
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than those applicable to all Lenders as such. Without limiting the foregoing,
none of the Lenders so identified as a "co-syndication agent" or a
"co-documentation agent" shall have or be deemed to have any fiduciary
relationship with any Lender. Each Lender acknowledges that it has not relied,
and will not rely, on any of the Lenders so identified in deciding to enter into
this Agreement or in taking or not taking any action hereunder.
ARTICLE XI
MISCELLANEOUS
Section 11.1 Amendments and Waivers. Neither this Agreement or any
other Loan Document, nor any terms hereof or thereof may be amended,
supplemented or modified except in accordance with the provisions of this
Section 11.1. The Required Lenders may, or, with the written consent of the
Required Lenders, the Administrative Agent may, from time to time, (a) enter
into with the Borrower or any other applicable Loan Party written amendments,
supplements or modifications hereto and to the other Loan Documents for the
purpose of adding any provisions to this Agreement or the other Loan Documents
or changing in any manner the rights of the Lenders or of the Borrower or any
other Loan Party hereunder or thereunder or (b) waive in writing, on such terms
and conditions as the Required Lenders or the Administrative Agent, as the case
may be, may specify in such instrument, any of the requirements of this
Agreement or the other Loan Documents or any Default or Event of Default and its
consequences; provided, however, that no such waiver and no such amendment,
supplement or modification shall (i) reduce the amount or extend the scheduled
date of maturity of any Loan, or reduce the stated rate of any interest or fee
payable hereunder or extend the scheduled date of any payment thereof or
increase the amount or extend the expiration date of any Lender's Commitment, in
each case without the consent of each Lender affected thereby, or (ii) amend,
modify or waive any provision of this Section 11.1 or reduce the percentage
specified in the definition of Required Lenders, or consent to the assignment or
transfer by the Borrower of any of its rights and obligations under this
Agreement and the other Loan Documents (except in a transaction permitted by
Section 8.5), in each case without the written consent of all the Lenders, or
(iii) amend, modify or waive any provision of Article X without the written
consent of the then Administrative Agent, or (iv) release the Lenders' Liens on
all or substantially all of the Collateral under the Security Documents without
the consent of each Lender or (v) except to the extent relating to the sale or
other disposition of any Subsidiary of the Borrower as otherwise permitted by
this Agreement or any other transaction permitted by this Agreement, release any
Guarantee. Any such waiver and any such amendment, supplement or modification
shall apply equally to each of the Lenders and shall be binding upon the
Borrower, the Lenders, and the Administrative Agent. In the case of any waiver,
the Borrower, the Lenders and the Administrative Agent shall be restored to
their former position and rights hereunder and any other Loan Documents, and any
Default or Event of Default waived shall be deemed to be cured and not
continuing; but no such waiver shall extend to any subsequent or other Default
or Event of Default, or impair any right consequent thereon.
Section 11.2 Notices. All notices, requests and demands to or upon the
respective parties hereto to be effective shall be in writing (including by
telecopy), and, unless otherwise expressly provided herein, shall be deemed to
have been duly given or made when delivered by hand, or three days after being
deposited in the mail, postage prepaid, or, in the case of telecopy notice, when
received, addressed as follows in the case of the Borrower and the
Administrative
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Agent, and as set forth in Schedule I or Schedule II in the case of the other
parties hereto, or to such other address as may be hereafter notified by the
respective parties hereto and any future Lenders:
The Borrower: EPN Holding Company, L.P.
0 Xxxxxxxx Xxxxx, Xxxxx 000
XX Xxx 0000
Xxxxxxx, Xxxxx 00000
Attention: Chief Financial Officer
Telecopy: (000) 000-0000
with a copy (which shall
not constitute notice) to: Akin, Gump, Strauss, Xxxxx & Xxxx, L.L.P.
000 Xxxxxxxxx, Xxxxx 0000
Xxxxxxx, Xxxxx 00000
Telecopy: (000) 000-0000
Attention: J. Xxxxxxx Xxxxxxxx, Esq.
The Administrative Agent: JPMorgan Chase Bank
One Chase Xxxxxxxxx Xxxxx
0xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxx Xxxxxxxx
Telecopy: (000) 000-0000
provided that any notice, request or demand to or upon the Administrative Agent
shall not be effective until received, provided, further, that the failure by
the Administrative Agent or any Lender to provide a copy to the Borrower's
counsel shall not cause any notice to the Borrower to be ineffective.
Section 11.3 No Waiver; Cumulative Remedies. No failure to exercise and
no delay in exercising, on the part of the Administrative Agent or any Lender,
any right, remedy, power or privilege hereunder shall operate as a waiver
thereof; nor shall any single or partial exercise of any right, remedy, power or
privilege hereunder preclude any other or further exercise thereof or the
exercise of any other right, remedy, power or privilege. The rights, remedies,
powers and privileges herein provided are cumulative and not exclusive of any
rights, remedies, powers and privileges provided by law.
Section 11.4 Survival of Representations and Warranties. All
representations and warranties made hereunder and in any document, certificate
or statement delivered pursuant hereto or in connection herewith shall survive
the execution and delivery of this Agreement.
Section 11.5 Payment of Expenses and Taxes. The Borrower agrees (a) to
pay or reimburse the Administrative Agent for all its reasonable out-of-pocket
costs and expenses incurred in connection with the development, preparation and
execution of, and any amendment, supplement or modification to, this Agreement
and the other Loan Documents and any other documents prepared in connection
herewith or therewith, and the consummation and
79
administration of the transactions contemplated hereby and thereby, including,
without limitation, the fees and disbursements of counsel to the Administrative
Agent, (b) to pay or reimburse each Lender and the Administrative Agent for all
its costs and expenses incurred in connection with the enforcement or
preservation of any rights under this Agreement, the other Loan Documents and
any such other documents, including, without limitation, the fees and
disbursements of counsel to the Administrative Agent and to the several Lenders,
(c) to pay, indemnify, and hold each Lender and the Administrative Agent
harmless from, any and all recording and filing fees and any and all liabilities
with respect to, or resulting from any delay in paying, stamp, excise and other
taxes, if any, which may be payable or determined to be payable in connection
with the execution and delivery of, or consummation or administration of any of
the transactions contemplated by, or any amendment, supplement or modification
of, or any waiver or consent under or in respect of, this Agreement, the other
Loan Documents and any such other documents, and (d) to pay, indemnify, and hold
each Lender, the Administrative Agent, the Co-Syndication Agents, the
Co-Documentation Agents, and their Affiliates, and their respective directors,
officers, employees, agents and advisors (each such person being called an
"Indemnified Party") harmless from and against any and all other liabilities,
obligations, losses, damages, penalties, actions, judgments and suits, and
reasonable costs, expenses or disbursements, of any kind or nature whatsoever
with respect to the execution, delivery, enforcement, performance and
administration of this Agreement and the other Loan Documents, the use of the
proceeds of the Loans, including the use and reliance on electronic,
telecommunications or other information or transmission systems in connection
with the Loan Documents (all the foregoing in this clause (d), collectively, the
"indemnified liabilities"), REGARDLESS OF WHETHER OR NOT SUCH INDEMNIFIED
LIABILITIES ARE IN ANY WAY OR TO ANY EXTENT CAUSED, IN WHOLE OR IN PART, BY ANY
NEGLIGENT ACT OR OMISSION OF ANY KIND BY AN INDEMNIFIED PARTY, provided, that
the Borrower shall have no obligation hereunder to an Indemnified Party with
respect to indemnified liabilities arising from (i) the gross negligence or
willful misconduct of such Indemnified Party or (ii) legal proceedings commenced
against an Indemnified Party by any security holder or creditor thereof arising
out of and based upon rights afforded any such security holder or creditor
solely in its capacity as such. The agreements in this Section shall survive
repayment of the Loans and all other amounts payable hereunder.
Section 11.6 Successors and Assigns; Participations; Purchasing
Lenders.
(a) The provisions of this Agreement shall be binding upon and
inure to the benefit of the parties hereto and their respective successors and
assigns permitted hereby (including any Affiliate of the Issuing Bank that
issues any Letter of Credit), except that (i) the Borrower may not assign or
otherwise transfer any of its rights or obligations hereunder without the prior
written consent of each Lender (and any attempted assignment or transfer by the
Borrower without such consent shall be null and void) and (ii) no Lender may
assign or otherwise transfer its rights or obligations hereunder except in
accordance with this Section. Nothing in this Agreement, expressed or implied,
shall be construed to confer upon any Person (other than the parties hereto,
their respective successors and assigns permitted hereby (including any
Affiliate of the Issuing Bank that issues any Letter of Credit), Participants
(to the extent provided in paragraph (c) of this Section) and, to the extent
expressly contemplated hereby, the Related Parties of each of the Administrative
Agent, the Issuing Bank and the Lenders) any legal or equitable right, remedy or
claim under or by reason of this Agreement.
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(b) (i) Subject to the conditions set forth in paragraph
(b)(ii) below, any Lender may assign to one or more assignees all or a portion
of its rights and obligations under this Agreement (including all or a portion
of its Commitment and the Loans at the time owing to it) with the prior written
consent (such consent not to be unreasonably withheld) of:
(A) the Borrower, provided that no consent of the
Borrower shall be required for an assignment to an assignee that is a Lender
immediately prior to giving effect to such assignment, an Affiliate of such a
Lender, or, if an Event of Default has occurred and is continuing, any other
assignee; and
(B) the Administrative Agent, provided that no
consent of the Administrative Agent shall be required for an assignment to an
assignee that is a Lender immediately prior to giving effect to such assignment.
(ii) Assignments shall be subject to the following additional
conditions:
(A) except in the case of an assignment to a Lender
or an Affiliate of a Lender or an assignment of the entire remaining amount of
the assigning Lender's Commitment, the amount of the Commitment of the assigning
Lender subject to each such assignment (determined as of the date the Assignment
and Assumption with respect to such assignment is delivered to the
Administrative Agent) shall not be less than $5,000,000 unless each of the
Borrower and the Administrative Agent otherwise consent, provided that no such
consent of the Borrower shall be required if an Event of Default has occurred
and is continuing;
(B) each partial assignment shall be made as an
assignment of a proportionate part of all the assigning Lender's rights and
obligations under this Agreement, provided, that this clause 11.6(b)(ii)(B)
shall not be construed to prohibit assignment of a proportionate part of all the
assigning Lender's rights and obligations in respect of one Class of Commitments
or Loans;
(C) the parties to each assignment shall execute and
deliver to the Administrative Agent an Assignment and Assumption, together with
a processing and recordation fee of $2,500; and
(D) the assignee, if it shall not be a Lender, shall
deliver to the Administrative Agent an Administrative Questionnaire.
(iii) Subject to acceptance and recording thereof pursuant to
paragraph (b)(iv) of this Section, from and after the effective date specified
in each Assignment and Assumption the assignee thereunder shall be a party
hereto and, to the extent of the interest assigned by such Assignment and
Assumption, have the rights and obligations of a Lender under this Agreement,
and the assigning Lender thereunder shall, to the extent of the interest
assigned by such Assignment and Assumption, be released from its obligations
under this Agreement (and, in the case of an Assignment and Assumption covering
all of the assigning Lender's rights and obligations under this Agreement, such
Lender shall cease to be a party hereto but shall continue to be entitled to the
benefits of Sections 4.9, 4.10, 4.11 and 11.5 to the extent relating to matters
during the time it was a Lender). Any assignment or transfer by a Lender of
rights or obligations
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under this Agreement that does not comply with this Section 11.6 shall be
treated for purposes of this Agreement as a sale by such Lender of a
participation in such rights and obligations in accordance with paragraph (c) of
this Section to the extent complying with Section 11.6(c) or otherwise as void
and of no force and effect.
(iv) The Administrative Agent, acting for this purpose as an
agent of the Borrower, shall maintain at one of its offices a copy of each
Assignment and Assumption delivered to it and a register for the recordation of
the names and addresses of the Lenders, and the Commitment of, and principal
amount of the Loans and L/C Disbursements owing to, each Lender pursuant to the
terms hereof from time to time (the "Register"). The entries in the Register
shall be conclusive, and the Borrower, the Administrative Agent, the Issuing
Bank and the Lenders may treat each Person whose name is recorded in the
Register pursuant to the terms hereof as a Lender hereunder for all purposes of
this Agreement, notwithstanding notice to the contrary. The Register shall be
available for inspection by the Borrower, the Issuing Bank and any Lender, at
any reasonable time and from time to time upon reasonable prior notice.
(v) Upon its receipt of a duly completed Assignment and
Assumption executed by an assigning Lender and an assignee, the assignee's
completed Administrative Questionnaire (unless the assignee shall already be a
Lender hereunder), the processing and recordation fee referred to in paragraph
(b) of this Section and any written consent to such assignment required by
paragraph (b) of this Section, the Administrative Agent shall accept such
Assignment and Assumption, give notice of such Assignment and Assumption to the
Borrower, and record the information contained therein in the Register. No
assignment shall be effective for purposes of this Agreement unless it has been
recorded in the Register as provided in this paragraph.
(c) (i) Any Lender may, without the consent of the Borrower,
the Administrative Agent or the Issuing Bank, sell participations to one or more
banks or other entities (a "Participant") in all or a portion of such Lender's
rights and obligations under this Agreement (including all or a portion of its
Commitment and the Loans owing to it); provided that (A) such Lender's
obligations under this Agreement shall remain unchanged, (B) such Lender shall
remain solely responsible to the other parties hereto for the performance of
such obligations and (C) the Borrower, the Administrative Agent, the Issuing
Bank and the other Lenders shall continue to deal solely and directly with such
Lender in connection with such Lender's rights and obligations under this
Agreement. Any agreement or instrument pursuant to which a Lender sells such a
participation shall provide that such Lender shall retain the sole right to
enforce this Agreement and to approve any amendment, modification or waiver of
any provision of this Agreement or any other Loan Document, and no Lender shall
be entitled to create in favor of any Participant any right to vote on, consent
to or approve any matter relating to any Loan Document; provided that such
agreement or instrument may provide that such Lender will not, without the
consent of the Participant, agree to any amendment, modification or waiver
described in clause (i), (ii) or (iv) of the proviso to Section 11.1 that
directly affects such Participant. Subject to paragraph (c)(ii) of this Section,
the Borrower agrees that each Participant shall be entitled to the benefits of
Sections 4.9, 4.10 and 4.11 to the same extent as if it were a Lender and had
acquired its interest by assignment pursuant to paragraph (b) of this Section.
To the extent permitted by law, each Participant also shall be entitled to the
benefits of Section 11.5
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as though it were a Lender, provided such Participant agrees to be subject to
Section 11.7 as though it were a Lender.
(ii) A Participant shall not be entitled to receive any
greater payment under Section 4.9, 4.10 or 4.11 than the applicable Lender would
have been entitled to receive with respect to the participation sold to such
Participant, unless the sale of the participation to such Participant is made
with the Borrower's prior written consent. A Participant that would be a Foreign
Lender if it were a Lender shall not be entitled to the benefits of Section 4.10
unless the Borrower is notified of the participation sold to such Participant
and such Participant agrees, for the benefit of the Borrower, to comply with
Section 4.10(b) as though it were a Lender.
(d) Any Lender may at any time pledge or assign a security
interest in all or any portion of its rights under this Agreement to secure
obligations of such Lender, including any pledge or assignment to secure
obligations to a Federal Reserve Bank, and this Section shall not apply to any
such pledge or assignment of a security interest; provided that no such pledge
or assignment of a security interest shall release a Lender from any of its
obligations hereunder or substitute any such pledgee or assignee for such Lender
as a party hereto.
Section 11.7 Adjustments; Set-off.
(a) If any Lender (a "benefitted Lender") shall at any time
receive any payment of all or part of its Loans or the Reimbursement Obligations
owing to it, or interest thereon, or receive any collateral in respect thereof
(whether voluntarily or involuntarily, by set-off, pursuant to events or
proceedings of the nature referred to in Article IX(f), or otherwise), in a
greater proportion than any such payment to or collateral received by any other
Lender, if any, in respect of such other Lender's Loans of the same type or the
Reimbursement Obligations owing to it, as the case may be, or interest thereon,
such benefitted Lender shall purchase for cash from the other Lenders a
participating interest in such portion of each such other Lender's Loan or the
Reimbursement Obligations owing to it, or shall provide such other Lenders with
the benefits of any such collateral, or the proceeds thereof, as shall be
necessary to cause such benefitted Lender to share the excess payment or
benefits of such collateral or proceeds ratably with each of the Lenders;
provided, however, that if all or any portion of such excess payment or benefits
is thereafter recovered from such benefitted Lender, such purchase shall be
rescinded, and the purchase price and benefits returned, to the extent of such
recovery, but without interest.
(b) In addition to any rights and remedies of the Lenders
provided by law, each Lender shall have the right, without prior notice to the
Borrower, any such notice being expressly waived by the Borrower to the extent
permitted by applicable law, upon any amount becoming due and payable by the
Borrower hereunder (whether at the stated maturity, by acceleration or
otherwise) to set-off and appropriate and apply against such amount any and all
deposits (general or special, time or demand, provisional or final), in any
currency, and any other credits, indebtedness or claims, in any currency, in
each case whether direct or indirect, absolute or contingent, matured or
unmatured, at any time held or owing by such Lender or any branch or agency
thereof to or for the credit or the account of the Borrower. Each Lender agrees
promptly to notify the Borrower and the Administrative Agent after any such
set-off and application made by such Lender, provided that the failure to give
such notice shall not affect the validity of such set-off and application.
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Section 11.8 Counterparts. This Agreement may be executed by one or
more of the parties to this Agreement on any number of separate counterparts,
and all of said counterparts taken together shall be deemed to constitute one
and the same instrument. A set of the copies of this Agreement signed by all the
parties shall be lodged with the Borrower and the Administrative Agent.
Section 11.9 Severability. Any provision of this Agreement which is
prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction,
be ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions hereof, and any such prohibition or
unenforceability in any jurisdiction shall not invalidate or render
unenforceable such provision in any other jurisdiction.
Section 11.10 Integration. This Agreement and the other Loan Documents
represent the agreement of the Borrower, the Administrative Agent and the
Lenders with respect to the subject matter hereof, and there are no promises,
undertakings, representations or warranties by the Administrative Agent or any
Lender relative to subject matter hereof not expressly set forth or referred to
herein or in the other Loan Documents.
Section 11.11 Usury Savings Clause. It is the intention of the parties
hereto to comply with applicable usury laws (now or hereafter enacted);
accordingly, notwithstanding any provision to the contrary in this Agreement,
any of the other Loan Documents or any other document related hereto, in no
event shall this Agreement or any such other document require the payment or
permit the collection of interest in excess of the maximum amount permitted by
such laws. If from any circumstances whatsoever, fulfillment of any provision of
this Agreement or of any other document pertaining hereto or thereto, shall
involve transcending the limit of validity prescribed by applicable law for the
collection or charging of interest, then, ipso facto, the obligation to be
fulfilled shall be reduced to the limit of such validity, and if from any such
circumstances the Administrative Agent and the Lenders shall ever receive
anything of value as interest or deemed interest by applicable law under this
Agreement, any of the other Loan Documents or any other document pertaining
hereto or otherwise an amount that would exceed the highest lawful rate, such
amount that would be excessive interest shall be applied to the reduction of the
principal amount owing hereunder or on account of any other indebtedness of the
Borrower, and not to the payment of interest, or if such excessive interest
exceeds the unpaid balance of principal of such indebtedness, such excess shall
be refunded to the Borrower. In determining whether or not the interest paid or
payable with respect to any indebtedness of the Borrower to the Administrative
Agent and the Lenders, under any specified contingency, exceeds the Highest
Lawful Rate (as hereinafter defined), the Borrower, the Administrative Agent and
the Lenders shall, to the maximum extent permitted by applicable law, (a)
characterize any non-principal payment as an expense, fee or premium rather than
as interest, (b) exclude voluntary prepayments and the effects thereof, (c)
amortize, prorate, allocate and spread the total amount of interest throughout
the full term of such indebtedness so that interest thereon does not exceed the
maximum amount permitted by applicable law, and/or (d) allocate interest between
portions of such indebtedness, to the end that no such portion shall bear
interest at a rate greater than that permitted by applicable law.
To the extent that Article 5069-1D.001 et seq., as amended, of the
Texas Revised Civil Statutes is relevant to the Administrative Agent and the
Lenders for the purpose of determining
84
the Highest Lawful Rate, the Administrative Agent and the Lenders hereby elect
to determine the applicable rate ceiling under such Article by the indicated
(weekly) rate ceiling from time to time in effect. Nothing set forth in this
Section 11.11 is intended to or shall limit the effect or operation of Section
11.12. In no event shall Chapter 346 of the Texas Finance Code (which regulates
certain revolving credit loan accounts) apply to this Agreement or the Notes.
For purposes of this Section 11.11, "Highest Lawful Rate" shall mean
the maximum rate of nonusurious interest that may be contracted for, charged,
taken, reserved or received hereunder under laws applicable to the
Administrative Agent and the Lenders.
Section 11.12 GOVERNING LAW. THIS AGREEMENT AND THE NOTES AND THE
RIGHTS AND OBLIGATIONS OF THE PARTIES UNDER THIS AGREEMENT AND THE NOTES SHALL
BE GOVERNED BY, AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAWS OF
THE STATE OF NEW YORK.
Section 11.13 Submission To Jurisdiction; Waivers. The Borrower hereby
irrevocably and unconditionally:
(a) submits for itself and its property in any legal action or
proceeding relating to this Agreement and the other Loan Documents to which it
is a party, or for recognition and enforcement of any judgment in respect
thereof, to the non-exclusive general jurisdiction of the Courts of the State of
New York, the courts of the United States of America for the Southern District
of New York, and appellate courts from any thereof;
(b) consents that any such action or proceeding may be brought
in such courts and waives any objection that it may now or hereafter have to the
venue of any such action or proceeding in any such court or that such action or
proceeding was brought in an inconvenient court and agrees not to plead or claim
the same;
(c) agrees that service of process in any such action or
proceeding may be effected by mailing a copy thereof by registered or certified
mail (or any substantially similar form of mail), postage prepaid, to the
Borrower at its address set forth in Section 11.2 or at such other address of
which the Administrative Agent shall have been notified pursuant thereto;
(d) agrees that nothing herein shall affect the right to
effect service of process in any other manner permitted by law or shall limit
the right to xxx in any other jurisdiction; and
(e) waives, to the maximum extent not prohibited by law, any
right it may have to claim or recover in any legal action or proceeding referred
to in this Section any special, exemplary or punitive damages (including,
without limitation, damages arising from the use of electronic,
telecommunications or other information transmissions systems in connection with
the Loan Documents).
Section 11.14 Acknowledgements. The Borrower hereby acknowledges that:
(a) it has been advised by counsel in the negotiation,
execution and delivery of this Agreement and the other Loan Documents;
85
(b) neither the Administrative Agent nor any Lender has any
fiduciary relationship with or duty to the Borrower or any other Loan Party
arising out of or in connection with this Agreement or any of the other Loan
Documents, and the relationship between Administrative Agent and Lenders, on one
hand, and the Borrower and the other Loan Parties, on the other hand, in
connection herewith or therewith is solely that of debtor and creditor; and
(c) no joint venture exists among the Lenders or among the
Borrower and the other Loan Parties and the Lenders.
Section 11.15 Confidentiality. Each of the Administrative Agent and
each Lender agrees that it will hold in confidence, any information provided to
such Person pursuant to this Agreement; provided, that nothing in this Section
11.15 shall be deemed to prevent the disclosure by the Administrative Agent or
any Lender of any such information (a) to any employee, officer, director,
accountant, attorney or consultant of such Person, or any examiner or other
Governmental Authority, (b) that has been or is made public by EPEPC, EPN or any
of its Subsidiaries or Affiliates or by any third party without breach of this
Agreement or that otherwise becomes generally available to the public other than
as a result of a disclosure in violation of this Section 11.15, (c) that is or
becomes available to any such Person from a third party on a non-confidential
basis, (d) that is required to be disclosed by any Requirement of Law, including
to any bank examiners or regulatory authorities, (e) that is required to be
disclosed by any court, agency, arbitrator or legislative body, (f) to any
Transferee or proposed Transferee, or (g) to any rating agency to the extent
required in connection with any rating to be assigned to such Lender.
Section 11.16 WAIVERS OF JURY TRIAL. THE BORROWER, THE ADMINISTRATIVE
AGENT AND THE LENDERS HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVE TRIAL BY JURY
IN ANY LEGAL ACTION OR PROCEEDING RELATING TO THIS AGREEMENT OR THE NOTES OR ANY
OTHER LOAN DOCUMENT AND FOR ANY COUNTERCLAIM THEREIN.
Section 11.17 Releases.
(a) At such time as the Loans, the Reimbursement Obligations
and any other obligations under this Agreement shall have been paid in full, the
Commitments have been terminated and no Letters of Credit shall be outstanding,
the Collateral shall be released from the Liens created by the Loan Documents,
and all obligations (other than those expressly stated to survive such
termination) of the Administrative Agent and each Loan Party thereunder and
under the other Loan Documents shall terminate, all without delivery of any
instrument or performance of any act by any party, and all rights to the
Collateral shall revert to the respective Loan Parties. At the request and
expense of any Loan Party following any such termination, the Administrative
Agent shall deliver to such Loan Party any Collateral held by the Administrative
Agent under the Security Documents, and execute and deliver to such Loan Party
such documents as such Loan Party shall reasonably request to evidence such
termination.
(b) If any of the Collateral shall be sold, transferred or
otherwise disposed of by any Loan Party in a transaction permitted by this
Agreement, then the Lenders authorize the Administrative Agent, at the request
and expense of such Loan Party, to execute and deliver to
86
such Loan Party all releases or other documents reasonably necessary or
desirable for the release of the Liens created by the applicable Security
Documents on such Collateral. At the request and sole expense of the Borrower,
the Lenders authorize the Administrative Agent to release a Loan Party from its
obligations under the applicable Security Document in the event that all the
Equity Interests of such Loan Party shall be sold, transferred or otherwise
disposed of in a transaction permitted by this Agreement, provided that the
Borrower shall have delivered to the Administrative Agent, at least five
Business Days prior to the date of the proposed release, a written request for
release identifying the relevant Loan Party and the terms of the sale or other
disposition in reasonable detail, including the price thereof and any expenses
in connection therewith, together with a certification by the Borrower stating
that such transaction is in compliance with this Agreement and the other Loan
Documents.
Section 11.18 Limitation on Recourse of Lenders. The obligations
created by this Agreement are obligations of the Borrower only, and not of EPN
or any of the Subsidiaries of EPN (except the Borrower, its Subsidiaries, the
Limited Partner and the General Partner). Each Lender agrees that except as
otherwise specifically provided for hereafter, in the event of a Default in the
payment of the Obligations by the Borrower or any of its Subsidiaries or any
other Default hereunder, such Lender's sole recourse shall be against the
Borrower and its Subsidiaries, the Limited Partner's and the General Partner's
equity interest in the Borrower, any Collateral, any other assets of the
Borrower and its Subsidiaries, any obligations of the Limited Partner or the
General Partner under the Parent Guarantees or the Partnership Agreement or any
other Loan Document to which such Person is now or hereafter a party. Nothing in
this Section 11.18 shall be construed so as to prevent the Lenders or the
Administrative Agent from commencing any action, suit or proceeding with respect
to the Borrower or causing legal papers to be served upon the Limited Partner,
the General Partner or EPN for purposes of obtaining jurisdiction over the
Borrower. Notwithstanding the foregoing limitation of liability, however, the
Lenders shall have recourse to and do not waive any rights to pursue EPN and any
of its Subsidiaries in connection with:
(a) for their fraud, material misrepresentation, or gross
negligence in connection with this Agreement or any other Loan Document;
(b) for willful actions of any such Person that hinder or
interfere with the Administrative Agent's or Lenders' rights in Collateral or
diminish the value thereof as set forth in the Loan Documents or otherwise;
(c) for any breaches of warranty of title;
(d) for the return of, or reimbursement for, (i) proceeds of
insurance covering any property of the Borrower or its Subsidiaries or (ii)
proceeds of the sale or condemnation of any property of the Borrower or its
Subsidiaries, in either case, such proceeds that have been distributed in
violation of Section 8.7;
(e) for the return of, or reimbursement for, all personal
property taken from the Borrower and its Subsidiaries by or on behalf of any
such Person in violation of Section 8.7; and
87
(f) for all court costs and all attorney's fees incurred by
the Administrative Agent or the Lenders in enforcing the obligations set forth
in this Section 11.18 against any such Person.
88
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed and delivered by their proper and duly authorized officers as of
the day and year first above written.
THE BORROWER:
EPN HOLDING COMPANY, L.P.
By: EPN GP Holding, L.L.C.,
its General Partner
By: /s/ XXXXX XXXXXX
--------------------------------------
Vice President and
Chief Financial Officer
SIGNATURE PAGE-1
THE ADMINISTRATIVE AGENT AND THE LENDERS:
JPMORGAN CHASE BANK,
as Administrative Agent and as a Lender
By: /s/ XXXXXX XXXX
--------------------------------------
Vice President
SIGNATURE PAGE-2
BANK ONE, NA (Main Office Chicago)
By: /s/ XXXXXX X. XXXXXXX
--------------------------------------
Director
SIGNATURE PAGE-3
WACHOVIA BANK, NATIONAL ASSOCIATION
By: /s/ XXXXXX XXXXXXX
--------------------------------------
Vice President
SIGNATURE PAGE-4
FLEET NATIONAL BANK
By: /s/ XXXXXX X. SCHOCHLING
--------------------------------------
Director
SIGNATURE PAGE-5
FORTIS CAPITAL CORP.
By: /s/ XXXXXXX X. XXXXXX
--------------------------------------
Managing Director
By: /s/ XXXXXXX XXXXXXX
--------------------------------------
Vice President
SIGNATURE PAGE-6
ARAB BANKING CORPORATION (B.S.C.)
By: /s/ XXXXXX X. XXXXXXXXX
--------------------------------------
Deputy General Manager
By: /s/ XXXXXXX X. XXXXXX
--------------------------------------
Vice President
SIGNATURE PAGE-7
BANK OF AMERICA, N.A.
By: /s/ XXXXXX X. XxXXXX
--------------------------------------
Managing Director
SIGNATURE PAGE-8
BANK OF SCOTLAND
By: /s/ XXXXXX XXXXXX
--------------------------------------
Vice President
SIGNATURE PAGE-9
BAYERISCHE HYPO-UND VEREINSBANK AG (New
York Branch)
By: /s/ XXXXXXX XXXXXXXX
--------------------------------------
Director
By: /s/ XXXXXXXX XXXXXXXXXX
--------------------------------------
Director
SIGNATURE PAGE-10
BNP PARIBAS
By: /s/ XXXX X. XXX
--------------------------------------
Director
By: /s/ XXXX XXXXXXXX
--------------------------------------
Vice President
SIGNATURE PAGE-11
CIBC INC.
By: /s/ XXXX X. XXXXXX
--------------------------------------
Authorized Signatory
SIGNATURE PAGE-12
CITICORP NORTH AMERICA, INC.
By: /s/ XXXXXXX NAPVEUX
--------------------------------------
Director
SIGNATURE PAGE-13
CREDIT SUISSE FIRST BOSTON CAYMAN ISLANDS
BRANCH
By: /s/ XXXX X. XXXXX
--------------------------------------
Vice President
By: /s/ XXXXXXX XXXXX
--------------------------------------
Associate
SIGNATURE PAGE-14
XXXXXXX XXXXX CREDIT PARTNERS L.P.
By: /s/ XXXXXX XXXXXXXXXX
--------------------------------------
Vice President
SIGNATURE PAGE-15
ROYAL BANK OF CANADA
By: /s/ XXX X. XXXXXXXXXX
--------------------------------------
Senior Manager
SIGNATURE PAGE-16
SOUTHWEST BANK OF TEXAS, N.A.
By: /s/ W. XXXXX XXXXXXX
--------------------------------------
Vice President, Energy Lending
SIGNATURE PAGE-17
SUNTRUST BANK
By: /s/ XXXXXX X. XxXXXXXX
--------------------------------------
Vice President
SIGNATURE PAGE-18
THE BANK OF NOVA SCOTIA
By: /s/ X. XXXX
--------------------------------------
Assistant Agent
SIGNATURE PAGE-19
UBS AG, STAMFORD BRANCH
By: /s/ XXXXXXXX X'XXXXX
--------------------------------------
Director
Banking Products Services
By: /s/ XXXXXXX X. SAINT
--------------------------------------
Associate Director
Banking Products Services, US
SIGNATURE PAGE-20
THE ROYAL BANK OF SCOTLAND plc, New York
Branch
By: /s/ XXXXXXXX X. DUNDEE
--------------------------------------
Senior Vice President
SIGNATURE PAGE-21
