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EXHIBIT 10.1
AGREEMENT
THIS AGREEMENT (this "Agreement") is made as of April 14, 2000 by and
between ING (U.S.) Capital LLC, successor in interest by merger to ING (U.S.)
Capital Corporation, as Agent ("Agent") and Lender ("Lender"), and United States
Exploration, Inc. ("Borrower") and Producers Service Incorporated ("Producers";
Borrower and Producers are herein collectively referred to as the "Related
Parties" and each individually as a "Related Party").
RECITALS:
1. Borrower, Agent, and Lender are parties to that certain Credit Agreement
dated as of May 15, 1998 (as amended, supplemented, or restated to the date
hereof, the "Credit Agreement"), pursuant to which Lender extended credit to,
and for the account of, Borrower under that certain Promissory Note executed by
Borrower to the order of Lender in the original principal amount of $35,000,000
dated as of May 15, 1998 (the "Note").
2. Producers has guaranteed the payment and performance of Borrower's
obligations under the Credit Agreement and the Note pursuant to that certain
Guaranty dated as of May 15, 1998 (as amended, supplemented, or restated to the
date hereof, the "Guaranty").
3. Borrower executed and delivered to Agent for the benefit of Lender (a)
that certain Pledge Agreement dated as of May 15, 1998 (as amended,
supplemented, or restated to the date hereof, the "Pledge Agreement") pursuant
to which Borrower granted a security interest to Agent for the benefit of Lender
in such properties of Borrower as described therein, to secure the payment and
performance of the Note and other therein described obligations of Borrower to
Agent and/or Lender and (b) that certain Mortgage, Assignment, Security
Agreement, Fixture Filing and Financing Statement dated as of May 15, 1998 (as
amended, supplemented, or restated to the date hereof, the "Mortgage") pursuant
to which Borrower mortgaged, conveyed, and granted a security interest to Agent
for the benefit of Lender in such properties of Borrower as described therein,
to secure the payment and performance of the Note and other therein described
obligations of Borrower to Agent and/or Lender.
4. Agent, Lender, and the Related Parties desire to enter into this
Agreement in order describe the terms and conditions under which Agent and
Lender shall assign to Borrower or a Permitted Designee (as such term is defined
below) certain of Agent's and Lender's rights, titles, and interests in and to
the Credit Agreement, the Note, the Guaranty, the Pledge Agreement, the
Mortgage, and the other Loan Documents (as such term is defined in the Credit
Agreement).
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NOW, THEREFORE, in consideration of the premises, of the benefits which
will inure to each party hereto hereunder, and of Ten Dollars and other good and
valuable consideration, the receipt and sufficiency of all of which are hereby
acknowledged, each Related Party hereby agrees with Agent and Lender as follows:
AGREEMENTS:
Section 1. Definitions. Reference is hereby made to the Credit Agreement
for all purposes. All terms used in this Agreement which are defined in the
Credit Agreement and not otherwise defined herein shall have the same meanings
when used herein. All references herein to any Loan Document, or other document
or instrument refer to the same as from time to time amended, supplemented or
restated. As used herein, the terms "Agreement", "Agent", "Lender", "Borrower",
"Producers", "Related Parties", "Related Party", "Credit Agreement", "Note",
"Guaranty", "Pledge Agreement", and "Mortgage" shall have the meanings given
such term in the recitals hereto. As used herein the following terms shall have
the following meanings:
"Assignment Agreement" means the Assignment of Notes and Liens attached
hereto as Exhibit A.
"Closing Date" shall mean the date on which the Final Payment is made by
Borrower to Agent, which date shall be no later than the Termination Date.
"Final Payment" means either (a) $16,500,000 or (b) in the event the
Termination Date is extended pursuant to Section 2(b) hereof, $16,000,000.
"Initial Option Payment" means the amount of $500,000.
"Officers' Certificate" means the Certificate of the President and
Secretary of each Related Party in the form of Exhibit C hereto.
"Option Period" means the period from the date hereof until 3:00 p.m.
E.D.T. on the Termination Date.
"Permitted Designee" means any Person designated in writing by Borrower to
purchase the Loans and the Transaction Documents pursuant to Section 2(a).
"Release Agreement" means the Release Agreement attached hereto as Exhibit
B.
"Reserved Interests" shall mean all of the rights and benefits (on an
unsecured basis) equivalent to those provided in the Loan Documents with respect
to any Related Party's obligation to indemnify or hold harmless any of Agent or
Lender or any of their respective members, managers, directors, officers,
agents, attorneys, employees, representatives and Affiliates, including, without
limitation the rights and benefits (on an unsecured basis) provided
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in Section 10.4(b) of the Credit Agreement and other similar provisions of the
other Loan Documents; provided, however, that the Reserved Interests shall not
include any right to be indemnified against loss arising from the failure of the
Related Parties to pay the Note or from the sale of Note hereunder.
"Second Option Payment" means the amount of $500,000.
"Termination Date" means May 15, 2000.
"Transaction Documents" means the Credit Agreement, the Note, the Guaranty,
the Pledge Agreement, the Mortgages, and the other Loan Documents.
Section 2. Borrower's Option to Purchase the Loans.
(a) Borrower or a Permitted Designee may, at such Person's option at any
time during the Option Period, purchase from Agent and Lender all of Agent's and
Lender's respective right, title, and interest in, to, and under the Loans and
the Transaction Documents upon the terms and conditions of this Agreement;
provided however, that if each of the conditions precedent described in Section
6 hereof is not satisfied in Agent's sole and absolute discretion before the end
of the Option Period, this Agreement shall terminate and Agent and Lender shall
be under no obligation to sell to Borrower or any Permitted Designee any of
Agent's or Lender's respective right, title, and interest in and to the Loans
and the Transaction Documents.
(b) Notwithstanding the foregoing Section 2(a), if Borrower or any
Permitted Designee pays to Agent the Second Option Payment in accordance with
Section 4(c) hereof on or before 3:00 p.m. E.D.T. on May 15, 2000, the
Termination Date shall be extended to May 31, 2000; provided however, that if
(after the payment of the Second Option Payment to Agent) each of the conditions
precedent described in Section 6 hereof is not satisfied in Agent's sole and
absolute discretion before the end of the Option Period, this Agreement shall
terminate and Agent and Lender shall be under no obligation to sell to Borrower
or any Permitted Designee any of Agent's or Lender's respective right, title,
and interest in and to the Loans and the Transaction Documents.
Section 3. Sale and Conveyance of Loans and Transaction Documents; Delivery
of Note. Subject to the satisfaction of each of the conditions described in
Section 6 hereof, on the Closing Date:
(a) Agent and Lender, by their execution and delivery to Borrower or a
Permitted Designee of the Assignment Agreement, shall sell, transfer, assign,
set over and convey to such Person all of Agent's and Lender's right, title, and
interest in the Transaction Documents, including the Loan and the security
interests represented thereby, as of the Closing Date; PROVIDED, HOWEVER, THAT
AGENT AND LENDER SHALL NOT SELL, TRANSFER, ASSIGN, SET OVER AND
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CONVEY TO SUCH PERSON ANY OF THE RESERVED INTERESTS, WHICH RESERVED INTERESTS
WILL BE EVIDENCED BY SECTION 4 OF THE RELEASE AGREEMENT;
(b) Lender shall deliver to Borrower or a Permitted Designee the original
counterpart of the Note, endorsed to such Person as follows:
PAY TO THE ORDER OF ______________________ WITHOUT RECOURSE OR WARRANTY,
EXPRESS OR IMPLIED.
ING (U.S.) CAPITAL LLC, successor in interest by merger to ING (U.S.)
CAPITAL CORPORATION
By:______________________________
Name:
Title:
(c) Agent and Lender shall execute and deliver to the Related Parties the
Release Agreement.
Section 4. Payments.
(a) On the date hereof, Borrower shall pay to Agent the Initial Option
Payment in order to induce Agent and Lender to enter into this Agreement.
(b) On the Closing Date, Borrower or a Permitted Designee shall pay to
Agent the Final Payment in order to induce Agent and Lender to deliver the
Assignment Agreement and the Note to Borrower or a Permitted Designee and the
Release Agreement to the Related Parties on the Closing Date.
(c) All payments made by Borrower or a Permitted Designee pursuant to this
Section 4 shall be made by wire transfer of immediately available funds in
accordance with the following instructions:
Pay: The Chase Manhattan Bank, New York
ABA No: 000-000-000
Account Name: ING Capital Loan/Agency Account
Account No: 066297311
Reference: United States Exploration
Attention: Xxxxx X. Xxxxxxx
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Section 5. Option Payments.
(a) Each Related Party hereby acknowledges (i) that the Initial Option
Payment is irrevocable and non-refundable to the Borrower and (ii) that the
Initial Option Payment is being paid by Borrower in order to induce Agent and
Lender to enter into this Agreement.
(b) Each Related Party hereby acknowledges (i) that the Second Option
Payment, if paid pursuant to Section 2(b) hereof, shall be irrevocable and
non-refundable to the payor thereof and (ii) that the Second Option Payment
shall be paid by Borrower or a Permitted Designee in order to induce Agent and
Lender to extend the Termination Date to May 31, 2000.
Section 6. Conditions Precedent. Agent and Lender shall be under no
obligation to execute and deliver the Assignment Agreement to Borrower or any
Permitted Designee unless and until each of the following conditions precedent
shall have been satisfied before the end of the Option Period:
(a) Borrower shall have paid to Agent the Final Payment in accordance with
Section 4(b) hereof;
(b) each Related Party shall have executed and delivered to Agent the
Release Agreement;
(c) Borrower shall have paid to Agent in immediately available funds (i)
the amount of $31,000 in satisfaction of fees and expenses of Agent's legal
counsel incurred as of the date hereof plus (ii) such additional fees and
expenses of Agent's legal counsel incurred as of the Closing Date; and
(d) Each Related Party shall have executed and delivered to Agent the
Officers' Certificate.
Section 7. Assignment. This Agreement may not be assigned by Borrower and
the other Related Persons to any Person other than a Permitted Designee.
Section 8. Loan Document. This Agreement is a Loan Document, and all
provisions in the Credit Agreement pertaining to Loan Documents apply hereto.
SECTION 9. TIME IS OF THE ESSENCE. TIME IS OF THE ESSENCE OF THIS
AGREEMENT.
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SECTION 10. GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK AND ANY
APPLICABLE LAWS OF THE UNITED STATES OF AMERICA IN ALL RESPECTS, INCLUDING
CONSTRUCTION, VALIDITY AND PERFORMANCE.
Section 11. Counterparts. This Agreement may be separately executed in
counterparts and by the different parties hereto in separate counterparts, each
of which when so executed shall be deemed to constitute one and the same
Agreement.
IN WITNESS WHEREOF, this Agreement is executed as of the date first written
above.
ING (U.S.) CAPITAL LLC, as Agent and Lender
By: /s/ Xxxxx X. Xxxxxxx
------------------------------------------------
Xxxxx X. Xxxxxxx
Director
UNITED STATES EXPLORATION, INC.
By: /s/ Xxxxx X. Xxxxxx
------------------------------------------------
Xxxxx X. Xxxxxx
President and Chief Executive Officer
PRODUCERS SERVICE INCORPORATED
By: /s/ Xxxxx X. Xxxxxx
------------------------------------------------
Xxxxx X. Xxxxxx
President and Chief Executive Officer
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Exhibit A
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ASSIGNMENT OF NOTE AND LIENS
ING (U.S.) Capital LLC, successor in interest by merger to ING (U.S.)
Capital Corporation (hereinafter referred to as "Assignor"), as Agent and Lender
under the Credit Agreement (as defined below), for good and valuable
consideration in hand paid, the receipt and sufficiency of which are hereby
acknowledged, has TRANSFERRED, SOLD, ASSIGNED, GRANTED and CONVEYED and by these
presents does TRANSFER, SELL, ASSIGN, GRANT and CONVEY unto
_____________________, a ___________________ ("Assignee"), and its successors
and assigns, the following note and instruments (the "Instruments"), the sums
payable thereunder, and all of Assignor's rights, title and interest in the
property therein described, SAVE AND EXCEPT THE RESERVED INTERESTS (AS DEFINED
BELOW), together with all its remedies, powers, benefits, monies, payments, fees
and revenues pertaining thereto, with good right to collect, enforce, release
and discharge the same, as well as any and all other liens, security interests,
assignments or financing statements now or hereafter existing and securing the
obligations in and under the Instruments:
1. That certain promissory note (the "Note") dated May 15, 1998, in
the original principal amount of $35,000,000, executed by United States
Exploration, Inc. ("Borrower") and payable to the order of Assignor
together with interest thereon as therein provided.
2. Those certain instruments described on Schedule I attached hereto.
To have and hold each of the said Instruments described herein, together
with all right, title, interest, liens, privileges, claims, demands and equities
existing and to exist in connection therewith or as security therefor (OTHER
THAN THE RESERVED INTERESTS) unto Assignee, its successors and assigns forever.
Assignor expressly waives and releases any and all rights that Assignor may
now have or hereafter have to establish or enforce any lien or security interest
securing payment of any of the Instruments, including, without limitation, those
existing under any of the Instruments as security for the payment of any other
or future indebtedness of Borrower to Assignor.
Assignor hereby represents, covenants and warrants to Assignee, its
successors and assigns that: (a) Assignor is the present legal and equitable
owner and holder of each of the Instruments described herein, the indebtedness
evidenced thereby, and all liens and security interests granted to Assignor to
secure such Instruments and indebtedness (the "Liens"); (b) Assignor has the
full right and authority to transfer and convey each of the Instruments
described herein, the indebtedness evidenced thereby and the Liens, and to
execute this agreement and other than consents already obtained, no consents,
notices, filings or approvals are required to be made to or received from any
person for the sale and assignment hereunder; and (c) Assignor has not assigned,
mortgaged, hypothecated, granted a security interest in, or otherwise encumbered
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any of said Instruments, the indebtedness evidenced thereby or the Liens to any
other parties. Other than the original counterpart of the Note which is being
delivered to Assignee concurrently herewith, Assignor will promptly deliver to
Assignee the original counterparts of the Instruments, to the extent that such
counterparts are in the possession or control of Assignor.
OTHER THAN AS STATED HEREIN, THE ASSIGNMENT AND TRANSFER OF THE
INSTRUMENTS IS MADE BY ASSIGNOR WITHOUT RECOURSE, REPRESENTATION OR
WARRANTY, EXPRESS OR IMPLIED (INCLUDING, WITHOUT LIMITATION, ANY
REPRESENTATION OR WARRANTY OF ANY KIND AS TO THE PRIORITY, VALIDITY,
ENFORCEABILITY OR THE SUFFICIENCY OF THE INSTRUMENTS OR THE LIENS).
Capitalized terms used but not defined herein shall have the meanings given
them in that certain Credit Agreement dated as of May 15, 1998, by and between
Assignor, as Agent and Lender, and Borrower (as amended, supplemented, or
restated to the date hereof, the "Credit Agreement"). As used herein, "Reserved
Interests" means all of the rights and benefits (on an unsecured basis)
equivalent to those provided in the Loan Documents with respect to any
Restricted Person's obligation to indemnify or hold harmless Assignor, as Agent
or Lender, or any of its members, managers, directors, officers, agents,
attorneys, employees, representatives and Affiliates, including, without
limitation the rights and benefits (on an unsecured basis) provided in Section
10.4(b) of the Credit Agreement and other similar provisions of the other Loan
Documents as set forth in that certain Release Agreement of even date herewith
by and among Assignor, as Agent and Lender, Borrower, and Producers Service
Incorporated; provided, however, that the Reserved Interests shall not include
any right to be indemnified against loss arising from the failure of the
Restricted Persons to pay the Note or from the sale of the Note to Assignee.
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IN WITNESS WHEREOF, the undersigned has hereunto set his hand this ___ day
of May, 2000.
ING (U.S.) CAPITAL LLC, as Agent and Lender
By:
-----------------------------------------
Xxxxx X. Xxxxxxx
Director
STATE OF NEW YORK )
)
COUNTY OF NEW YORK )
This instrument was acknowledged before me on May __, 2000, by Xxxxx X.
Xxxxxxx, Director of ING (U.S.) Capital LLC, on behalf of ING (U.S.) Capital
LLC.
-----------------------------------------
Name:
-----------------------------------------
Notary Public, State of New York
My Commission Expires:
----------------------
[Seal]
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Schedule I
Recording Schedule
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Exhibit B
RELEASE AGREEMENT
THIS RELEASE AGREEMENT (this "Release Agreement") is made as of May ___,
2000 by and between ING (U.S.) Capital LLC, successor in interest by merger to
ING (U.S.) Capital Corporation, as Agent ("Agent") and Lender ("Lender"), and
United States Exploration, Inc. ("Borrower") and Producers Service Incorporated
("Producers"; Borrower and Producers are herein collectively referred to as the
"Related Parties" and each individually as a "Related Party").
RECITALS:
1. Borrower, Agent, and Lender are parties to that certain Credit Agreement
dated as of May 15, 1998 (as amended, supplemented, or restated to the date
hereof, the "Credit Agreement"), pursuant to which Lender extended credit to,
and for the account of, Borrower under that certain Promissory Note executed by
Borrower to the order of Lender in the original principal amount of $35,000,000
dated as of May 15, 1998 (the "Note").
2. Each Related Party, Agent, and Lender are parties to that certain
Agreement dated as of April __, 2000 (as amended, supplemented, or restated to
the date hereof, the "Agreement") pursuant to which Agent and Lender agreed to
sell, transfer, assign, set over and convey to Borrower or a Permitted Designee
all of Agent's and Lender's right, title, and interest in the Credit Agreement,
the Note, and the other Loan Documents (other than the Reserved Interests) upon
the satisfaction of certain conditions precedent specified in the Agreement (all
of the right, title, and interest of Agent and Lender assigned pursuant to the
Agreement are herein referred to as the "Assigned Interests").
3. The execution and delivery of this Release Agreement is a condition
precedent to Agent's and Lender's obligation to sell, transfer, assign, set over
and convey to Borrower or a Permitted Designee all of Agent's and Lender's
right, title, and interest in the Credit Agreement, the Note, and the other Loan
Documents (other than the Reserved Interests).
NOW, THEREFORE, in consideration of the premises, of the benefits which
will inure to each party hereto hereunder, of the sale, transfer, and assignment
of by Agent and Lender of their respective interests in the Credit Agreement,
the Note, and the other Loan Documents, and of Ten Dollars and other good and
valuable consideration, the receipt and sufficiency of all of which are hereby
acknowledged, each Related Party hereby agrees with Agent and Lender as follows:
AGREEMENTS:
Section 1. Definitions. Reference is hereby made to the Credit Agreement
for all purposes. All terms used in this Release Agreement which are defined in
the Credit Agreement and not otherwise defined herein shall have the same
meanings when used herein. All references herein to any Loan Document, or other
document or instrument refer to the same as from time to
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time amended, supplemented or restated. As used herein, (a) "Reserved Interests"
shall have the meaning given such term in Section 4 hereof, and (b) "Permitted
Designee" shall have the meaning given to such term in the Agreement.
Section 2. Release by each Related Party. Subject to Section 6 hereof, EACH
RELATED PARTY - ON BEHALF OF ITSELF AND, TO THE EXTENT IT IS PERMITTED BY LAW OR
IS OTHERWISE EXPRESSLY AUTHORIZED TO DO SO, ON BEHALF OF ALL OF ITS AFFILIATES
(COLLECTIVELY, "RELEASING PARTIES") -- HEREBY GENERALLY RELEASES AND FOREVER
DISCHARGES EACH OF AGENT AND LENDER AND EACH OF THEIR RESPECTIVE AFFILIATES
(COLLECTIVELY, "RELEASED PARTIES"), FROM ANY AND ALL CLAIMS, DEMANDS, AND CAUSES
OF ACTION OF WHATEVER KIND OR CHARACTER WHICH SUCH RELEASING PARTY HAS, OR MAY
HAVE IN THE FUTURE, BASED ON ANY ACTIONS, FAILURES TO ACT, OR EVENTS THAT HAVE
OCCURRED PRIOR TO THE DATE HEREOF, WHICH IN ANY WAY RELATE TO OR ARE BASED UPON
(I) ANY TRANSACTIONS OF ANY KIND AMONG THE RELEASING PARTIES, ON THE ONE HAND,
AND THE RELEASED PARTIES, ON THE OTHER HAND, OR (II) ANY ACTUAL OR ALLEGED
NEGOTIATIONS, DISCUSSIONS, REPRESENTATIONS, WARRANTIES, PROMISES, OR OTHER
UNDERTAKINGS BY RELEASED PARTIES IN CONNECTION WITH ANY OF THE FOREGOING (THE
"RELEASED CLAIMS"). THIS RELEASE IS TO BE CONSTRUED AS THE BROADEST TYPE OF
GENERAL RELEASE AND COVERS AND RELEASES ANY AND ALL RELEASED CLAIMS, WHETHER
KNOWN OR UNKNOWN AND HOWEVER OR WHENEVER ARISING, WHETHER BY CONTRACT OR
AGREEMENT, AT LAW OR UNDER ANY STATUTE (INCLUDING WITHOUT LIMITATION ANY LAW OR
STATUTE PERTAINING TO NEGLIGENCE, GROSS NEGLIGENCE, STRICT LIABILITY, FRAUD,
DECEPTIVE TRADE PRACTICES, NEGLIGENT MISREPRESENTATION, SECURITIES VIOLATIONS,
BREACH OF FIDUCIARY DUTY, BREACH OF CONTRACT, TRADE REGULATION, REGULATION OF
BUSINESS OR COMPETITION, CONSPIRACY OR RACKETEERING), OR OTHERWISE ARISING, AND
EXPRESSLY INCLUDING ANY CLAIMS FOR PUNITIVE OR EXEMPLARY DAMAGES, ATTORNEYS'
FEES, OR PENALTIES. TO THE EXTENT THAT ANY RELEASED CLAIMS WITH RESPECT TO
RELEASED PARTIES HAVE NOT BEEN RELEASED HEREBY, EACH RELEASING PARTY HEREBY
ASSIGNS SUCH RELEASED CLAIMS TO RELEASED PARTIES.
Section 3. Release by Agent and Lender. Subject to Section 6 hereof and
excluding the Assigned Interests, EACH OF AGENT AND LENDER - ON BEHALF OF ITSELF
AND, TO THE EXTENT IT IS PERMITTED BY LAW OR IS OTHERWISE EXPRESSLY AUTHORIZED
TO DO SO, ON BEHALF OF ALL OF ITS AFFILIATES (COLLECTIVELY, "RELEASING PARTIES")
-- HEREBY GENERALLY RELEASES AND FOREVER DISCHARGES EACH
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RELATED PARTY AND EACH OF ITS RESPECTIVE AFFILIATES (COLLECTIVELY, "RELEASED
PARTIES"), FROM ANY AND ALL CLAIMS, DEMANDS, AND CAUSES OF ACTION OF WHATEVER
KIND OR CHARACTER WHICH SUCH RELEASING PARTY HAS, OR MAY HAVE IN THE FUTURE,
BASED ON ANY ACTIONS, FAILURES TO ACT, OR EVENTS THAT HAVE OCCURRED PRIOR TO THE
DATE HEREOF (OTHER THAN THE RESERVED INTERESTS), WHICH IN ANY WAY RELATE TO OR
ARE BASED UPON (I) ANY TRANSACTIONS OF ANY KIND AMONG THE RELEASING PARTIES, ON
THE ONE HAND, AND THE RELEASED PARTIES, ON THE OTHER HAND, OR (II) ANY ACTUAL OR
ALLEGED NEGOTIATIONS, DISCUSSIONS, REPRESENTATIONS, WARRANTIES, PROMISES, OR
OTHER UNDERTAKINGS BY RELEASED PARTIES IN CONNECTION WITH ANY OF THE FOREGOING
(THE "RELEASED CLAIMS"). THIS RELEASE IS TO BE CONSTRUED AS THE BROADEST TYPE OF
GENERAL RELEASE AND COVERS AND RELEASES ANY AND ALL RELEASED CLAIMS, WHETHER
KNOWN OR UNKNOWN AND HOWEVER OR WHENEVER ARISING, WHETHER BY CONTRACT OR
AGREEMENT, AT LAW OR UNDER ANY STATUTE (INCLUDING WITHOUT LIMITATION ANY LAW OR
STATUTE PERTAINING TO NEGLIGENCE, GROSS NEGLIGENCE, STRICT LIABILITY, FRAUD,
DECEPTIVE TRADE PRACTICES, NEGLIGENT MISREPRESENTATION, SECURITIES VIOLATIONS,
BREACH OF FIDUCIARY DUTY, BREACH OF CONTRACT, TRADE REGULATION, REGULATION OF
BUSINESS OR COMPETITION, CONSPIRACY OR RACKETEERING), OR OTHERWISE ARISING, AND
EXPRESSLY INCLUDING ANY CLAIMS FOR PUNITIVE OR EXEMPLARY DAMAGES, ATTORNEYS'
FEES, OR PENALTIES. TO THE EXTENT THAT ANY RELEASED CLAIMS WITH RESPECT TO
RELEASED PARTIES HAVE NOT BEEN RELEASED HEREBY, EACH RELEASING PARTY HEREBY
ASSIGNS SUCH RELEASED CLAIMS TO RELEASED PARTIES.
Section 4. Reserved Interests. Notwithstanding anything to the contrary
contained herein, each Related Party agrees to indemnify each of Agent and
Lender, upon demand, from and against any and all liabilities, obligations,
claims, losses, damages, penalties, fines, actions, judgments, suits,
settlements, costs, expenses or disbursements (including reasonable fees of
attorneys, accountants, experts and advisors) of any kind or nature whatsoever
(in this section collectively called "liabilities and costs") which to any
extent (in whole or in part) may be imposed on, incurred by, or asserted against
Agent or Lender growing out of, resulting from or in any other way associated
with any of the Collateral, the Loan Documents and the transactions and events
(including the enforcement or defense thereof) at any time associated therewith
or contemplated therein (including any violation or noncompliance with any
Environmental Laws by any Related Party or any liabilities or duties of any
Related Party or any Agent or Lender with respect to Hazardous Materials found
in or released into the environment).
THE FOREGOING INDEMNIFICATION SHALL APPLY WHETHER OR NOT SUCH
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LIABILITIES AND COSTS ARE IN ANY WAY OR TO ANY EXTENT OWED, IN WHOLE OR IN PART,
UNDER ANY CLAIM OR THEORY OF STRICT LIABILITY, OR ARE CAUSED, IN WHOLE OR IN
PART, BY ANY NEGLIGENT ACT OR OMISSION OF ANY KIND BY ANY AGENT OR LENDER,
provided only that neither Agent nor Lender shall be entitled under this section
to receive indemnification for that portion, if any, of any liabilities and
costs which is proximately caused by its own individual gross negligence or
willful misconduct, as determined in a final judgment. If any Person (including
any Related Party) ever alleges such gross negligence or willful misconduct by
either Agent or Lender, the indemnification provided for in this section shall
nonetheless be paid upon demand, subject to later adjustment or reimbursement,
until such time as a court of competent jurisdiction enters a final judgment as
to the extent and effect of the alleged gross negligence or willful misconduct.
As used in this section the term "Agent" and "Lender" shall refer not only to
the Persons designated as such in the recitals hereto, but also to each member,
manager, director, officer, agent, attorney, employee, representative and
affiliate of such Persons. The obligations of the Related Parties to indemnify
Agent and Lender pursuant to this Section 4 are collectively referred to herein
as the "Reserved Interests"; provided, however, that the Reserved Interests
shall not include any right of Agent or Lender to be indemnified against loss
arising from the failure of the Related Parties to pay the Note or from the sale
of the Note in accordance with the Agreement.
Section 5. Representations and Warranties.
(a) Each Related Party hereby represents and warrants to Agent and Lender
that it has not assigned any Released Claim to any Person.
(b) Each of Agent and Lender represents to each Related Party that, to its
knowledge without investigation, as of the date hereof there is no pending or
threatened claim with respect to which the Related Parties have an obligation to
indemnify Agent or Lender pursuant to the foregoing Section 4.
Section 6. Survival of Agreements. All representations, warranties,
covenants and agreements of the Related Parties herein or in any certificate or
instrument delivered in connection herewith or the Agreement shall survive the
execution and delivery of this Release Agreement and the performance hereof. All
statements and agreements contained in any certificate or instrument delivered
by any Related Party hereunder or under the Agreement to Agent or Lender shall
be deemed to constitute representations and warranties by, or agreements and
covenants of, such Related Party under this Release Agreement and under the
Agreement. EACH RELATED PARTY HEREBY ACKNOWLEDGES THAT NEITHER AGENT NOR LENDER
HAS RELEASED ANY RESERVED INTERESTS AND THAT ALL SUCH RESERVED INTERESTS HAVE
BEEN RETAINED BY AGENT AND LENDER.
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Section 7. Loan Document. This Release Agreement is a Loan Document, and
all provisions in the Credit Agreement pertaining to Loan Documents apply
hereto.
SECTION 8. GOVERNING LAW. THIS RELEASE AGREEMENT SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK AND ANY
APPLICABLE LAWS OF THE UNITED STATES OF AMERICA IN ALL RESPECTS, INCLUDING
CONSTRUCTION, VALIDITY AND PERFORMANCE.
Section 9. Counterparts. This Release Agreement may be separately executed
in counterparts and by the different parties hereto in separate counterparts,
each of which when so executed shall be deemed to constitute one and the same
Release Agreement.
IN WITNESS WHEREOF, this Release Agreement is executed as of the date first
written above.
ING (U.S.) CAPITAL LLC, as Agent and Lender
By:
-----------------------------------------
Xxxxx X. Xxxxxxx
Director
UNITED STATES EXPLORATION, INC.
By:
-----------------------------------------
Xxxxx X. Xxxxxx
President and Chief Executive Officer
PRODUCERS SERVICE INCORPORATED
By:
-----------------------------------------
Xxxxx X. Xxxxxx
President and Chief Executive Officer
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Exhibit C
OFFICERS' CERTIFICATE
Reference is made to that certain Agreement dated as of April 17, 0000 (xxx
"Xxxxxxxxx"), xxxxxxx Xxxxxx Xxxxxx Exploration ("Borrower"), Producers Service
Incorporated ("Producers"), and ING (U.S.) Capital LLC, as Agent and Lender (the
"Agreement"). Terms which are defined in the Agreement and which are used but
not defined herein shall have the meanings given them in the Agreement. The
undersigned, Xxxxx X. Xxxxxx and , do hereby certify that they are the duly
elected, qualified, and acting President and Chief Executive Officer and
Secretary, respectively, of each of Borrower and Producers, and that:
1. Attached hereto as Exhibit A is a true, correct and complete copy of
certain resolutions duly adopted by the Board of Directors of Borrower in
accordance with Borrower's Articles of Incorporation and Bylaws and none of such
resolutions has been rescinded, revoked, modified, or amended in any respect,
and all of such resolutions are in full force and effect on the date hereof.
2. Attached hereto as Exhibit B is a true, correct and complete copy of
certain resolutions duly adopted by the Board of Directors of Producers in
accordance with Producers' Articles of Incorporation and Bylaws and none of such
resolutions has been rescinded, revoked, modified, or amended in any respect,
and all of such resolutions are in full force and effect on the date hereof.
3. Xxxxx X. Xxxxxx is the duly elected, qualified and acting President and
Chief Executive Officer of each of Borrower and Producers. _______________ is
the duly elected, qualified and acting Secretary of each of Borrower and
Producers. Xxxxx X. Xxxxxx is duly authorized to execute and deliver the
Agreement and the Release Agreement on behalf of each Related Party.
4. Each Related Party has duly taken all action necessary to authorize the
execution and delivery by it of the Agreement and the Release Agreement and to
authorize the consummation of the transactions contemplated thereby and the
performance of its obligations thereunder.
5. The execution and delivery by each Related Party of the Agreement and
the Release Agreement, the performance by each Related Party of its obligations
thereunder and the consummation of the transactions contemplated thereby do not
and will not conflict with any provision of law, statute, rule or regulation or
of the articles of incorporation and bylaws of any Related Party, or of any
material agreement, judgment, license, order or permit applicable to or binding
upon any Related Party, or result in the creation of any lien, charge or
encumbrance upon any assets or properties of any Related Party. Except for those
which have been obtained, no consent, approval, authorization or order of any
court or governmental authority or third party is
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required in connection with the execution and delivery by any Related Party of
the Agreement or the Release Agreement or to consummate the transactions
contemplated thereby.
6. When duly executed and delivered, each of the Agreement and the Release
Agreement will be a legal and binding obligation of each Related Party,
enforceable in accordance with its terms, except as limited by bankruptcy,
insolvency or similar laws of general application relating to the enforcement of
creditors' rights and by equitable principles of general application.
IN WITNESS WHEREOF, this instrument is executed by the undersigned as of
May __, 2000.
UNITED STATES EXPLORATION, INC.
By:
-----------------------------------------
Xxxxx X. Xxxxxx
President and Chief Executive Officer
By:
-----------------------------------------
Name:
Secretary
PRODUCERS SERVICE
INCORPORATED
By:
-----------------------------------------
Xxxxx X. Xxxxxx
President and Chief Executive Officer
By:
-----------------------------------------
Name:
Secretary
2
