1
1 EXECUTION VERSION
EXHIBIT 10.1
================================================================================
XXXXXXXXXX--XXXXX OIL CORPORATION,
as Borrower
AND
XXXXXXXXXX--XXXXX EXPLORATION COMPANY,
THAI XXXX HOLDINGS, INC.,
THAI XXXX LIMITED
AND
OTHER SUBSIDIARY GUARANTORS,
as Guarantors
_____________________________
CREDIT AGREEMENT
Dated as of February 26, 1997
______________________________
THE CHASE MANHATTAN BANK
================================================================================
2
TABLE OF CONTENTS
Page
----
Section 1. Definitions and Accounting Matters . . . . . . . . . . . . . . . . . . 1
1.01 Certain Defined Terms . . . . . . . . . . . . . . . . . . . . . . . 1
1.02 Accounting Terms and Determinations . . . . . . . . . . . . . . . . 13
Section 2. The Commitment, Loan, Note and Prepayments . . . . . . . . . . . . . . 14
2.01 The Loan . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
2.02 The Borrowing . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
2.03 Changes of Commitment . . . . . . . . . . . . . . . . . . . . . . . 14
2.04 Lending Office . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
2.05 Note . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
2.06 Optional Prepayments . . . . . . . . . . . . . . . . . . . . . . . . 15
2.07 Mandatory Prepayments . . . . . . . . . . . . . . . . . . . . . . . 15
Section 3. Payments of Principal and Interest . . . . . . . . . . . . . . . . . . 15
3.01 Repayment of Loan . . . . . . . . . . . . . . . . . . . . . . . . . 15
3.02 Interest . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
Section 4. Payments; Computations; Etc. . . . . . . . . . . . . . . . . . . . . . 16
4.01 Payments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
4.02 Computations . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
4.03 Minimum Amounts . . . . . . . . . . . . . . . . . . . . . . . . . . 16
4.04 Certain Notices . . . . . . . . . . . . . . . . . . . . . . . . . . 17
4.05 Setoff. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
Section 5. Yield Protection, Etc. . . . . . . . . . . . . . . . . . . . . . . . . 17
5.01 Additional Costs . . . . . . . . . . . . . . . . . . . . . . . . . . 17
5.02 U.S. Taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
Section 6. Guarantee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
6.01 The Guarantee . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
6.02 Obligations Unconditional . . . . . . . . . . . . . . . . . . . . . 20
6.03 Reinstatement . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
6.04 Subrogation . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
6.05 Remedies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
6.06 Continuing Guarantee . . . . . . . . . . . . . . . . . . . . . . . . 22
6.07 Thai Taxes. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
6.08 Rights of Contribution . . . . . . . . . . . . . . . . . . . . . . . 23
6.09 General Limitation on Guarantee Obligations . . . . . . . . . . . . 23
Section 7. Conditions Precedent . . . . . . . . . . . . . . . . . . . . . . . . . 24
7.01 The Loan . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
7.02 Further Conditions Precedent . . . . . . . . . . . . . . . . . . . . 27
Section 8. Representations and Warranties . . . . . . . . . . . . . . . . . . . . 27
8.01 Corporate Existence . . . . . . . . . . . . . . . . . . . . . . . . 27
8.02 Financial Condition . . . . . . . . . . . . . . . . . . . . . . . . 27
8.03 Litigation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
8.04 No Breach . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
(i)
3
Page
----
8.05 Action . . . . . . . . . . . . . . . . . . . . . . . . . 29
8.06 Approvals . . . . . . . . . . . . . . . . . . . . . . . 29
8.07 Use of Credit . . . . . . . . . . . . . . . . . . . . . 29
8.08 ERISA . . . . . . . . . . . . . . . . . . . . . . . . . 29
8.09 Taxes . . . . . . . . . . . . . . . . . . . . . . . . . 29
8.10 Investment Company Act . . . . . . . . . . . . . . . . . 30
8.11 Public Utility Holding Company Act . . . . . . . . . . . 30
8.12 Material Agreements and Liens . . . . . . . . . . . . . 30
8.13 Compliance with Laws . . . . . . . . . . . . . . . . . . 30
8.14 Capitalization . . . . . . . . . . . . . . . . . . . . . 31
8.15 Subsidiaries, Etc. . . . . . . . . . . . . . . . . . . . 32
8.16 Title to Assets . . . . . . . . . . . . . . . . . . . . 32
8.17 True and Complete Disclosure . . . . . . . . . . . . . . 32
8.18 Project Agreements; Completion . . . . . . . . . . . . . 33
8.19 Special Purpose Company . . . . . . . . . . . . . . . . 33
8.20 SBM . . . . . . . . . . . . . . . . . . . . . . . . . . 33
8.21 Use of Proceeds . . . . . . . . . . . . . . . . . . . . 34
Section 9. Covenants of the Obligors . . . . . . . . . . . . . . . . . 34
9.01 Financial Statements Etc. . . . . . . . . . . . . . . . 34
9.02 Litigation . . . . . . . . . . . . . . . . . . . . . . . 37
9.03 Existence, Etc. . . . . . . . . . . . . . . . . . . . . 37
9.04 Insurance . . . . . . . . . . . . . . . . . . . . . . . 38
9.05 Prohibition of Fundamental Changes . . . . . . . . . . . 38
9.06 Limitation on Liens . . . . . . . . . . . . . . . . . . 39
9.07 Indebtedness . . . . . . . . . . . . . . . . . . . . . . 42
9.08 Investments . . . . . . . . . . . . . . . . . . . . . . 43
9.09 Restricted Payments . . . . . . . . . . . . . . . . . . 44
9.10 Maintenance of Corporate Separateness . . . . . . . . . 44
9.11 Lines of Business; Etc. . . . . . . . . . . . . . . . . 44
9.12 Transactions with Affiliates . . . . . . . . . . . . . . 44
9.13 Certain Obligations Respecting Subsidiaries . . . . . . 45
9.14 Limitation on Sale and Leaseback Transactions and
Production Payments . . . . . . . . . . . . . . . . . 45
9.15 Project Agreements . . . . . . . . . . . . . . . . . . . 45
9.16 Affiliate Subordinated Indebtedness . . . . . . . . . . 46
9.17 Defaults Under Gas Sales and Certain Actions of
Thai Government Authorities. . . . . . . . . . . . . . 46
9.18 Additional Subsidiary Guarantors . . . . . . . . . . . . 47
Section 10. Events of Default . . . . . . . . . . . . . . . . . . . . 47
Section 11. Miscellaneous . . . . . . . . . . . . . . . . . . . . . . 50
11.01 Waiver . . . . . . . . . . . . . . . . . . . . . . . . 50
11.02 Notices . . . . . . . . . . . . . . . . . . . . . . . . 51
11.03 Expenses, Etc. . . . . . . . . . . . . . . . . . . . . 51
11.04 Amendments, Etc. . . . . . . . . . . . . . . . . . . . 52
11.05 Successors and Assigns . . . . . . . . . . . . . . . . 52
11.06 Assignments and Participations . . . . . . . . . . . . 52
11.07 Survival . . . . . . . . . . . . . . . . . . . . . . . 54
11.08 Captions . . . . . . . . . . . . . . . . . . . . . . . 54
(ii)
4
Page
----
11.09 Counterparts . . . . . . . . . . . . . . . . . . . . . . . . . . . 54
11.10 Governing Law; Submission to Jurisdiction . . . . . . . . . . . . 55
11.11 Waiver of Jury Trial . . . . . . . . . . . . . . . . . . . . . . . 56
11.12 Treatment of Certain Information; Confidentiality . . . . . . . . . 56
11.13 Appointment of the Borrower as Agent . . . . . . . . . . . . . . . 57
11.14 Joint and Several Liability . . . . . . . . . . . . . . . . . . . . 57
11.15 Judgment Currency . . . . . . . . . . . . . . . . . . . . . . . . . 57
(iii)
5
SCHEDULE I - Material Agreement and Liens
SCHEDULE II - Compliance with Laws
SCHEDULE III - Subsidiaries and Investments
SCHEDULE IV - Litigation
SCHEDULE V - Taxes
SCHEDULE VI - Capitalization
SCHEDULE VII - Project Agreements
SCHEDULE VIII - Sale and Leaseback Transaction
EXHIBIT A - Form of Note
EXHIBIT B-1 - Form of Opinion of Special New York
Counsel to the Obligors
EXHIBIT B-2 - Form of Opinion of Special Thai Counsel
to the Obligors
EXHIBIT C - Form of Opinion of Special New York Counsel
to the Bank
EXHIBIT D - Form of Confidentiality Agreement
EXHIBIT E - Form of Assignment and Acceptance
EXHIBIT F - Form of Process Agent Acceptance
EXHIBIT G - Form of Process Agent Power of Attorney for
Thai Xxxx
EXHIBIT H - Form of Affiliate Subordination Agreement
(iv)
6
CREDIT AGREEMENT dated as of February 26, 1997, between:
XXXXXXXXXX--XXXXX OIL CORPORATION, a corporation duly organized and validly
existing under the laws of the State of Delaware (the "Borrower");
XXXXXXXXXX--XXXXX EXPLORATION COMPANY, a corporation duly organized and validly
existing under the laws of the State of Delaware ("RMEC"); THAI XXXX HOLDINGS,
INC., a corporation duly organized and validly existing under the laws of the
State of Delaware ("TRH"); THAI XXXX LIMITED, a limited liability company
organized under the laws of the Kingdom of Thailand ("Thai Xxxx"); each of the
Subsidiaries of the Borrower that becomes a guarantor pursuant to Section 9.18
hereof (RMEC, TRH, Thai Xxxx and each other such Subsidiary of the Borrower
that becomes a guarantor pursuant to Section 9.18 hereof, the "Subsidiary
Guarantors"); and THE CHASE MANHATTAN BANK, a New York State banking
corporation (in its capacity as a lender hereunder, the "Bank").
The Borrower has requested that the Bank make a loan to it in
an aggregate principal amount not exceeding $20,000,000 and the Bank is
prepared to make such loan upon the terms and conditions hereof. Accordingly,
the parties hereto agree as follows:
Section 1. Definitions and Accounting Matters.
1.01 Certain Defined Terms. As used herein, the following
terms shall have the following meanings (all terms defined in this Section 1.01
or in other provisions of this Agreement in the singular to have the same
meanings when used in the plural and vice versa):
"Accounts Agreement" shall mean the Amended and Restated
Accounts Agreement between SBM, Thaipo, Thai Xxxx, Sophonpanich and any other
parties thereto relating to the flow of funds from the operation of the Project
and detailing the reimbursement procedure referenced in Article 8.1 in the
Operating Agreement for the payment of amounts owed to SBM.
"Affiliate" means, as to any Person, any Subsidiary of such
Person and any other Person which, directly or indirectly, controls, is
controlled by or is under common control with such Person. For the purposes of
this definition, "control" means the possession of the power to direct or cause
the direction of management and policies of such Person, whether through the
ownership of voting securities, by contract or otherwise. Notwithstanding the
foregoing, (i) no individual shall be an Affiliate of any Person solely by
reason of his or her being a director, officer or employee of such Person and
(ii) none of the Borrower and the Wholly Owned Subsidiaries of the Borrower
shall be Affiliates of each other.
Credit Agreement
7
- 2 -
"Affiliate Subordinated Indebtedness" shall mean Indebtedness
of any Subsidiary Guarantor to the Borrower or to any other Subsidiary
Guarantor for borrowed money the obligations of such Subsidiary Guarantor in
respect of which are subordinated to the obligations of such Subsidiary
Guarantor hereunder pursuant to an Affiliate Subordination Agreement (or on
other terms of subordination, and pursuant to documentation, reasonably
satisfactory to the Bank).
"Affiliate Subordination Agreement" shall mean one or more
subordination agreement(s) among the Borrower, any of the Subsidiary Guarantors
and the Bank in substantially the form of Exhibit H hereto.
"Applicable Lending Office" shall mean the "Lending Office" of
the Bank designated for the Loan on the signature pages hereof or such other
office of the Bank (or of an affiliate of the Bank) as the Bank may from time
to time specify to the Borrower as the office by which the Loan is to be made
and maintained.
"Applicable Margin" shall mean 3/4% per annum.
"Bankruptcy Code" shall mean the U.S. Federal Bankruptcy Code
of 1978, as amended from time to time.
"Bareboat Charter" shall mean the Bareboat Charter dated as of
February 9, 1996, between Tantawan Production B.V. and Tantawan Services, LLC
in connection with the charter of the "TANTAWAN EXPLORER" for use in the
Tantawan Field in the Gulf of Thailand.
"Base Rate" shall mean, for any day, a rate per annum equal to
the higher of (a) the Federal Funds Rate for such day plus 1/2 of 1% and (b)
the Prime Rate for such day. Each change in the interest rate provided for
herein based upon the Base Rate resulting from a change in the Base Rate shall
take effect at the time of such change in the Base Rate.
"Basic Documents" shall mean, collectively, this Agreement and
the Note.
"Borrowing Base" shall have the meaning assigned to such term
in Section 1.04(b)(iv) of the Existing Credit Agreement on the date hereof.
"Business Day" shall mean any day on which commercial banks
are not authorized or required to close in New York City.
"Capital Lease Obligations" shall mean, for any Person, all
obligations of such Person to pay rent or other amounts under
Credit Agreement
8
- 3 -
a lease of (or other agreement conveying the right to use) Property to the
extent such obligations are required to be classified and accounted for as a
capital lease on a balance sheet of such Person under GAAP, and, for purposes
of this Agreement, the amount of such obligations shall be the capitalized
amount thereof, determined in accordance with GAAP.
"Chase" shall mean The Chase Manhattan Bank or any successor.
"Closing Date" shall mean February 26, 1997.
"Code" shall mean the U.S. Internal Revenue Code of 1986, as
amended from time to time.
"Commitment" shall mean the obligation of the Bank to make the
Loan pursuant to Section 2.01 hereof in a principal amount up to but not
exceeding $20,000,000 (as the same may be reduced at any time or from time to
time pursuant to Section 2.03 hereof).
"Commitment Termination Date" shall mean the Scheduled
Commitment Termination Date or such earlier date as shall be determined in
accordance with Section 2.03 hereof.
"Completion" shall mean the successful completion of the 72
hour test referenced in Article 6.3(i) of the Gas Sales Agreement shall have
been achieved.
"Completion Date" shall mean the first date upon which
Completion shall have occurred.
"Concession Agreement" shall mean, collectively, (i) Petroleum
Concession No. 1/2534/36 dated as of August 1, 1991, whereby the Ministry of
Industry of the Kingdom of Thailand awarded to Maersk, Thaipo, and Thai Xxxx
the concession to develop hydrocarbon producing properties in Block B8/32 in
the Gulf of Thailand; (ii) Supplementary Petroleum Concession No. 1 to
Petroleum Concession No. 1/2534/36 dated as of March 6, 1992, whereby
Sophonpanich entered into Petroleum Concession No. 1/2534/36; and (iii)
Supplementary Petroleum Concession No. 2 to Petroleum Concession No. 1/2534/36
dated as of September 4, 1995, whereby Maersk transferred all of its interest
in the Tantawan Field to Thaipo and whereby Thaipo, Thai Xxxx and Sophonpanich
readjusted their respective interests in the Tantawan Field.
"Crude Sales Agreement" shall mean Memorandum of Understanding
for Sales and Purchase of the Tantawan Blend dated as of November 14, 1996
among PTT and Thaipo Limited, Sophonpanich, and Thai Xxxx, providing for the
purchase and sale of approximately 240,000 barrels per month of crude oil
produced from the Project,
Credit Agreement
9
- 4 -
as the same shall be supplemented, modified and in effect from time to time.
"Default" shall mean an Event of Default or an event that with
notice or lapse of time or both would become an Event of Default.
"Disposition" shall have the meaning assigned to it in the
Existing Credit Agreement on the date hereof.
"Dollar-Denominated Production Payments" shall mean production
payment obligations of the Borrower or any Subsidiary Guarantor which are
payable from a specified share of proceeds received from production from
specific Properties, together with all undertakings and obligations in
connection therewith.
"Dollars" and "$" shall mean lawful money of the United States
of America.
"Equity Rights" shall mean, with respect to any Person, any
subscriptions, options, warrants, commitments, preemptive rights or agreements
of any kind (including, without limitation, any stockholders' or voting trust
agreements) for the issuance, sale, registration or voting of, or securities
convertible into, any additional shares of capital stock of any class, or
partnership or other ownership interests of any type in, such Person.
"ERISA" shall mean the Employee Retirement Income Security Act
of 1974, as amended from time to time.
"ERISA Affiliate" shall mean any corporation or trade or
business that is a member of any group of organizations (i) described in
Section 414(b) or (c) of the Code of which any of the Borrower and its
Subsidiaries is a member and (ii) solely for purposes of potential liability
under Section 302(c)(11) of ERISA and Section 412(c)(11) of the Code and the
lien created under Section 302(f) of ERISA and Section 412(n) of the Code,
described in Section 414(m) or (o) of the Code of which any of the Borrower and
its Subsidiaries is a member.
"Event of Default" shall have the meaning assigned to such
term in Section 10 hereof.
"Existing Credit Agreement" shall mean the Credit Agreement
dated as of September 20, 1996 between: the Borrower, the Subsidiary
Guarantors, each of the lenders that is a signatory thereto identified under
the caption "LENDERS" on the signature pages thereto or that pursuant to
Section 12.06(b) thereof, shall become a "Lender" thereunder (individually, a
"Lender" and, collectively, the "Lenders"), and The Chase Manhattan Bank, as
administrative agent for the Lenders (in such capacity, together
Credit Agreement
10
- 5 -
with any successors in such capacity, the "Administrative Agent"), as such is
modified, supplemented and in effect from time to time.
"Federal Funds Rate" shall mean, for any day, the rate per
annum (rounded upwards, if necessary, to the nearest 1/100 of 1%) equal to the
weighted average of the rates on overnight Federal funds transactions with
members of the Federal Reserve System arranged by Federal funds brokers on such
day, as published by the Federal Reserve Bank of New York on the Business Day
next succeeding such day, provided that (a) if the day for which such rate is
to be determined is not a Business Day, the Federal Funds Rate for such day
shall be such rate on such transactions on the next preceding Business Day as
so published on the next succeeding Business Day and (b) if such rate is not so
published for any Business Day, the Federal Funds Rate for such Business Day
shall be the average rate charged to the Bank on such Business Day on such
transactions as determined by the Bank.
"GAAP" shall mean accounting principles generally accepted in
the United States as such principles shall be in effect at the time of the
computation or determination or as of the date of the relevant financial
statements, as the case may be (the "Relevant Date").
"Gas Sales Agreement" shall mean the Gas Sales Agreement dated
as of November 7, 1995 among the Petroleum Authority of Thailand, as gas
purchaser, and Thaipo, Thai Xxxx, and Sophonpanich, as gas sellers.
"Government Authority" shall mean any federal, state,
provincial, municipal, local or territorial government or governmental
subdivision, department, court, commission, board, bureau, agency, regulatory
authority, instrumentality, judicial, taxing or administrative body, domestic
or foreign, including, without limitation, in the case of the Kingdom of
Thailand, any ministry or state enterprise of the Kingdom of Thailand and any
officer or official of any of the foregoing.
"Guarantee" shall mean a guarantee, an endorsement, a
contingent agreement to purchase or to furnish funds for the payment or
maintenance of, or otherwise to be or become contingently liable under or with
respect to, the Indebtedness, other obligations, net worth, or working capital
of any Person or any production or revenues generated by (or any capital or
other expenditures incurred in connection with the acquisition and exploitation
of, or the exploration for or development or production of) any Hydrocarbon
Properties, or a guarantee of the payment of dividends or other distributions
upon the stock or equity interests of any Person, or an agreement to purchase,
sell or lease (as lessee or lessor) Property, products, materials, supplies or
services primarily for the purpose of enabling a debtor
Credit Agreement
11
- 6 -
to make payment of such debtor's obligations or an agreement to assure a
creditor against loss, and including, without limitation, a guarantee in favor
of a bank or other financial institution in order to cause such bank or
financial institution to issue a letter of credit or other similar instrument
for the benefit of another Person, but excluding endorsements for collection or
deposit in the ordinary course of business. The terms "Guarantee" and
"Guaranteed" used as a verb shall have a correlative meaning.
"Hedging Agreement" shall mean, for any Person, an agreement
or arrangement between such Person and one or more financial institutions or
other entities providing for the transfer or mitigation of risks of
fluctuations in (x) the prices of hydrocarbons, either generally or under
specific circumstances or (y) currency exchange rates either generally or under
specific circumstances.
"Hydrocarbon Properties" shall mean, without duplication, the
Borrower's and Subsidiary Guarantors' interests in hydrocarbon reserves.
"Indebtedness" shall mean, for any Person (without
duplication): (a) obligations created, issued or incurred by such Person for
borrowed money (whether by loan, the issuance and sale of debt securities or
the sale of Property to another Person subject to an understanding or
agreement, contingent or otherwise, to purchase or repurchase the same or
similar Property from such Person); (b) obligations of such Person to pay the
deferred purchase or acquisition price of Property or services, other than
trade accounts payable (other than for borrowed money) arising, and accrued
expenses incurred, in the ordinary course of business so long as such trade
accounts payable are payable within 90 days after the date of receipt of the
invoice therefor; (c) obligations of others secured by a Lien on the Property
of such Person, whether or not the respective obligations so secured has been
assumed by such Person; (d) obligations of such Person in respect of letters of
credit, surety bonds or similar instruments issued or accepted by banks, surety
companies and other financial institutions for account of such Person and
issued in respect of liabilities of such Person of the type described in other
clauses of this definition; (e) Capital Lease Obligations of such Person other
than any thereof for which Thai Xxxx is liable and which is incurred in
connection with transactions under the Operating Agreement or the Joint
Operating Agreement; (f) obligations of such Person in respect of obligations
of the types specified in other clauses of this definition as a partner or
joint venturer of any partnership or joint venture (other than in respect of
obligations incurred in the ordinary course of business); (g) obligations of
such Person in respect of Interest Rate Protection Agreements or Hedging
Agreements; and (h) Indebtedness of others Guaranteed by such Person, provided
that the term "Indebtedness" shall not include any
Credit Agreement
12
- 7 -
of the foregoing which are subject to irrevocable legal defeasance in
accordance with the terms thereof. When used with respect to Thai Xxxx,
"Indebtedness" shall include Thai Xxxx'x obligations to reimburse the operator
under the Operating Agreement or The Joint Operating Agreement for Thai Xxxx'x
pro rata share of payments made by such operator in respect of Indebtedness
incurred by such operator in connection with transactions under such
agreements.
"Independent Petroleum Engineer" shall have the meaning
assigned to it in the Existing Credit Agreement on the date hereof.
"Interest Rate Protection Agreement" shall mean, for any
Person, an interest rate swap, cap or collar agreement or similar arrangement
between such Person and one or more financial institutions providing for the
transfer or mitigation of interest risks either generally or under specific
contingencies.
"Investment" in any Person shall mean any investment, whether
by means of share purchase, loan, advance, extension of credit, capital
contribution or otherwise, in or to such Person, the Guarantee of any
Indebtedness of such Person or the subordination of any claim against such
Person to other Indebtedness of such Person; except that "Investment" shall not
include investments in inventory or trade receivables made or arising in the
ordinary course of business for the sale of goods or services; provided that
when used with respect to Thai Xxxx, "Investments" shall include any payments
made by Thai Xxxx to the operator under the Operating Agreement in satisfaction
of Thai Xxxx'x obligations to reimburse such operator for its pro rata share of
Investments made by such operator in connection with transactions under such
agreement.
"Joint Operating Agreement" shall mean, collectively, (i) the
Joint Operating Agreement dated as of August 1, 1991 between Maersk, Thai Xxxx,
Thaipo, and Sophonpanich, (ii) the Transfer Agreement dated March 2, 1995
between Maersk, Thai Xxxx, Thaipo, and Sophonpanich, whereby Maersk agrees to
convey its interest and operatorship in respect of the Tantawan Area of Block
B8/32 to Thaipo and (iii) the Agreement of Operatorship and Conveyance of
Interest dated as of March 3, 1995 between Maersk and Thaipo.
"Law" shall mean any present or future federal, state, local
or other constitution, charter, act, statute, law, ordinance, code, rule,
regulation, order, judgment of a court or standards contained in any
applicable permit or approval, or any other legislative, judicial or
administrative action of any Governmental Authority, including without
limitation, those relating to (1) the protection of human health, safety or the
environment or (2) to regulation of emissions, discharges, releases or
threatened releases to the environment.
Credit Agreement
13
- 8 -
"Legal Requirements" shall mean all laws, rules or regulations
of any Government Authority or any order, writ, injunction or decree of any
court or governmental or regulatory authority or agency.
"Lien" shall mean, with respect to any Property, any
assignment in trust, mortgage, lien, pledge, charge, fiduciary or security
assignment, security interest or encumbrance of any kind in respect of such
Property (including, without limitation, any Production Payment, advance,
payment or similar arrangement with respect to minerals in place). For
purposes of the foregoing, a Person shall be deemed to own subject to a Lien
any Property that it has acquired or holds subject to the interest of a vendor
or lessor under any conditional sale agreement, capital lease or other title
retention agreement (other than an operating lease) relating to such Property.
"Loan" shall mean the loan provided for in Section 2.01
hereof.
"Maersk" shall mean Maersk Oil (Thailand) Limited, a company
organized and existing under the laws of the Kingdom of Thailand.
"Margin Stock" shall mean "margin stock" within the meaning of
Regulation U and Y.
"Material Adverse Effect" shall mean a material adverse effect
on (a) the financial condition of the Borrower and its Subsidiaries taken as a
whole, or (b) the ability of any of the Obligors to perform any of its payment
obligations or any of its other material obligations under any of the Basic
Documents to which it is a party.
"Maturity Date" shall mean the Scheduled Maturity Date or such
earlier date as shall be specified in Section 2.07 hereof.
"Multiemployer Plan" shall mean a multiemployer plan defined
as such in Section 3(37) of ERISA to which contributions have been made by the
Borrower or any of its Subsidiaries or any ERISA Affiliate and that is covered
by Title IV of ERISA.
"Non-Recourse Debt" shall mean any Indebtedness of the
Borrower or any Subsidiary of the Borrower in respect of which the sole
recourse of the holder or holders thereof (except to the extent approved by the
Bank) is to specified Properties of the Borrower or one of its Subsidiaries and
the revenues generated thereby or to a Subsidiary of the Borrower whose only
assets (except to the extent approved by the Bank) consist of such specified
Properties and the revenues generated thereby and the terms and conditions of
which (including, without limitation, the
Credit Agreement
14
- 9 -
amortization and other payment provisions of which and the interest and other
compensation payable in respect of which, the non-recourse provisions of which
and the other terms of which including, without limitation, covenants and
events of default), and the documentation for which, are acceptable to the
Bank; provided that the existence in any document executed by the Borrower or
such Subsidiary in connection with such Non-Recourse Debt (the "Subject Debt")
of a provision which provides for recourse to the Properties or assets of the
Borrower or such Subsidiary generally by reason of gross negligence or willful
misconduct of the Borrower or such Subsidiary, will not cause the Subject Debt
to be excluded from the definition of "Non-Recourse Debt" prior to the time
that a claim is made against the Borrower or such Subsidiary, as the case may
be, alleging the gross negligence or willful misconduct of the Borrower or such
Subsidiary, as the case may be (it being understood that immediately upon any
such claim being made against the Borrower or such Subsidiary the amount of
such claim shall cease to be Non-Recourse Debt).
"Note" shall mean the promissory note provided for by Section
2.05 hereof or any promissory note delivered in substitution or exchange
therefor, in each case as the same shall be modified and supplemented and in
effect from time to time.
"Obligors" shall mean, collectively, the Borrower and the
Subsidiary Guarantors.
"Operating Agreement" shall mean the Operating Agreement
between SBM Marine Services Thailand Ltd. and Tantawan Services, LLC, dated
February 9, 1996, relating to the operation of the "TANTAWAN EXPLORER".
"Payment Default" shall mean any failure of the Borrower to
pay any principal of or interest on the Loan when due.
"PBGC" shall mean the Pension Benefit Guaranty Corporation or
any entity succeeding to any or all of its functions under ERISA.
"Permitted Investments" shall mean: (a) direct obligations of
the United States of America, or of any agency thereof, or obligations
guaranteed as to principal and interest by the United States of America, or of
any agency thereof, in each case maturing not more than 180 days from the date
of acquisition thereof; (b) marketable general obligations issued by any state
of the United States of America maturing within 180 days from the date of
acquisition thereof and, at the time of acquisition, having one of the two
highest ratings generally obtainable from either Standard & Poor's Ratings
Group or Xxxxx'x Investors Service, Inc.; (c) Dollar denominated domestic and
Eurodollar certificates of
Credit Agreement
15
- 10 -
deposit, time or demand deposits or bankers' acceptances and maturing within
180 days from the date of acquisition issued or guaranteed by, or placed with,
and money market deposit accounts issued or offered by: (i) the Bank, (ii) any
"Lender" (as defined in the Existing Credit Agreement) under the Existing
Credit Agreement, (iii) any other commercial bank organized under the laws of
the United States of America or any state thereof or the District of Columbia
(or the holding company of which such bank is a subsidiary) that maintains a
rating of "A" or better by Standard & Poor's Ratings Group or Xxxxx'x Investors
Services, Inc., and (iv) any branch located in the United States of America of
a commercial bank organized under the laws of the United Kingdom, Canada or
Japan (or the holding company of which such commercial bank is a subsidiary)
that maintains a rating of "A" or better by Standard & Poor's Ratings Group or
Xxxxx'x Investors Services, Inc.; (d) commercial paper rated A-1 or better or
P-1 or better by Standard & Poor's Ratings Group or Xxxxx'x Investors Services,
Inc., respectively; (e) investments arising under the Basic Documents; and (f)
fully collateralized repurchase agreements with a term of not more than 30 days
for underlying securities of the types described in clauses (a) and (b) of this
definition, entered into with any institution meeting the qualifications
specified in subclauses (i) through (iii) of clause (c) of this definition.
"Person" shall mean any individual, corporation, company,
voluntary association, partnership, joint venture, trust, unincorporated
organization or government (or any agency, instrumentality or political
subdivision thereof).
"Plan" shall mean an employee benefit or other plan
established or maintained by the Borrower or any ERISA Affiliate and that is
covered by Title IV of ERISA, other than a Multiemployer Plan.
"Pledge Agreements" shall have the meanings assigned to such
term in the Existing Credit Agreement on the date hereof.
"Post-Default Rate" shall mean, in respect of the principal
and interest of the Loan that is not paid when due (whether at stated maturity,
by acceleration or otherwise), a rate per annum during the period from and
including the due date to but excluding the date on which such amount is paid
in full equal to 2% plus the Base Rate as in effect from time to time plus the
Applicable Margin.
"Prime Rate" shall mean the rate of interest from time to time
announced by the Bank at the Principal Office as its prime commercial lending
rate.
Credit Agreement
16
- 11 -
"Principal Office" shall mean the principal office of Chase,
located on the date hereof at 000 Xxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000.
"Production Payments" shall mean Dollar-Denominated Production
Payments and Volumetric Production Payments.
"Project" shall mean the ongoing development activities in the
Tantawan area of Block B8/32 in the Gulf of Thailand pursuant to the Project
Agreements.
"Project Agreements" shall mean, collectively, the agreements
set forth on Schedule VII hereto.
"Property" shall mean any property of any kind whatsoever,
whether real, personal or mixed and whether tangible or intangible, including
any right or interest therein or thereto.
"Proved Reserves", for any Person, shall mean reserves (to the
extent of the net interest of such Person) comprised of quantities of
hydrocarbons which geologic and engineering data demonstrate with reasonable
certainty to be recoverable in future years from known reservoirs under
existing economic and operating conditions.
"PTT" shall mean The Petroleum Authority of Thailand.
"Qualifying Shares" shall mean the shares of Thai Xxxx stock
held by PRRTHAI, Inc., THAIPRR, L.P., JAMTHAI, Inc., THAIJAM, L.P. and MOMTHAI,
Inc., representing an aggregate of five ordinary shares.
"Quarterly Dates" shall mean the last Business Day of March
and June in 1997.
"Redetermination Date" shall have the meaning assigned to such
term in the Existing Credit Agreement on the date hereof.
"Regulation A", "Regulation U", "Regulation X, and "Regulation
Y" shall mean, respectively, Regulations A, U, X and Y of the Board of
Governors of the Federal Reserve System (or any successor), as the same may be
modified and supplemented and in effect from time to time.
"Regulatory Change" shall mean, with respect to the Bank, any
change after the date hereof in U.S. Federal, state or foreign law or
regulations or the adoption or making after such date of any interpretation,
directive or request applying to a class of banks including the Bank of or
under any U.S. Federal, state or foreign law or regulations (whether or not
having the force of law and whether or not failure to comply therewith would be
unlawful) by
Credit Agreement
17
- 12 -
any court or governmental or monetary authority charged with the interpretation
or administration thereof.
"Relevant Date" shall have the meaning assigned to such term
in the definition of "GAAP" in this Section 1.01.
"Reserve Evaluation Report" shall have the meaning assigned to
such term in the Existing Credit Agreement on the date hereof.
"Restricted Payments" shall mean dividends (in cash, Property
or obligations) on, or other payments or distributions on account of, or the
setting apart of money for a sinking or other analogous fund for, or the
purchase, redemption, retirement or other acquisition of, any shares of any
class of stock of the Borrower or of any warrants, options or other rights to
acquire the same (or to make any payments to any other Person, such as "phantom
stock" payments, where the amount thereof is calculated with reference to the
fair market or equity value of the Borrower or any of its Subsidiaries), but
excluding (a) dividends payable solely in shares of common stock of the
Borrower, and (b) payments of interest and principal on Affiliate Subordinated
Indebtedness to the extent permitted by the provisions thereof.
"Sales Agreement" shall mean any contract or agreement for the
sale by Thai Xxxx of crude oil or other hydrocarbon products, including the
Crude Sales Agreement.
"SBM" shall mean, collectively, SBM Bahamas Limited, a
Bahamian corporation, SBM Marine Services Thailand Ltd., a Thai corporation,
and Tantawan Production B.V., a Netherlands corporation.
"Scheduled Commitment Termination Date" shall mean the date
three Business Days after the Closing Date.
"Scheduled Maturity Date" shall mean June 30, 1997.
"Senior Officer" shall mean, when used with respect to an
Obligor, the president, the principal executive officer, the principal
operating officer or the principal financial officer of such Obligor.
"Share Acquisition" shall have the meaning assigned to such
term in Section 8.21 hereof.
"Share Sale Agreement" shall have the meaning assigned to such
term in Section 8.21 hereof.
"Sophonpanich" shall mean (i) Xxxxxx Xxxxxx Limited (the
successor to The Sophonpanich Co., Limited), a limited liability
Credit Agreement
18
- 13 -
company organized under the laws of the Kingdom of Thailand, or (ii) Xxxxxx
Thai Gulf Limited, a limited liability company organized under the laws of the
Kingdom of Thailand, as successor in interest to Xxxxxx Xxxxxx Limited, as the
case may be.
"Subsidiary" shall mean, with respect to any Person, any
corporation, partnership or other entity of which at least a majority of the
securities or other ownership interests having by the terms thereof ordinary
voting power to elect a majority of the board of directors or other persons
performing similar functions of such corporation, partnership or other entity
is at the time directly or indirectly owned or controlled by such Person or one
or more Subsidiaries of such Person or by such Person and one or more
Subsidiaries of such Person.
"Tantawan Joint Operating Agreement" shall mean the Joint
Operating Agreement effective as of March 3, 1995 between Thaipo, Thai Xxxx and
Sophonpanich.
"Taxes" shall mean all taxes, levies, imposts, stamp taxes,
duties, charges to tax, fees, deductions, withholdings, or charges, which are
imposed, levied, collected, withheld or assessed by any Government Authority as
of the date of this Agreement or at any time in the future together with
interest thereon and penalties with respect thereto, if any, including, without
limitation, production and severance taxes and "Tax" and "Taxation" shall be
construed accordingly.
"Thaipo" shall mean Thaipo Limited, a limited liability
company organized under the laws of the Kingdom of Thailand.
"Volumetric Production Payments" shall mean production payment
obligations of the Borrower or any Subsidiary Guarantor or any of its
Subsidiaries which are payable from a specified share of production from
specific Properties, together with all undertakings and obligations in
connection therewith.
"Wholly Owned Subsidiary" shall mean, with respect to any
Person, any corporation, partnership or other entity of which all of the equity
securities or other ownership interests (other than, in the case of a
corporation, directors' qualifying shares) are directly or indirectly owned or
controlled by such Person or one or more Wholly Owned Subsidiaries of such
Person or by such Person and one or more Wholly Owned Subsidiaries of such
Person.
1.02 Accounting Terms and Determinations.
(a) Except as otherwise provided in this Agreement, all
computations and determinations as to accounting or financial matters and all
financial statements to be delivered pursuant to this Agreement shall be made
and prepared in accordance with GAAP
Credit Agreement
19
- 14 -
and all accounting or financial terms shall have the meanings ascribed to such
terms by GAAP.
(b) None of the Obligors will change the last day of its
fiscal year from December 31 of each year, or the last days of the first three
fiscal quarters in each of its fiscal years from March 31, June 30 and
September 30 of each year, respectively.
Section 2. The Commitment, Loan, Note and Prepayments.
2.01 The Loan. The Bank agrees, on the terms and conditions
of this Agreement to make a loan to the Borrower in Dollars during the period
from and including the Closing Date to but not including the Commitment
Termination Date in a principal amount up to but not exceeding the amount of
the Commitment.
2.02 The Borrowing. The Borrower shall give the Bank notice
of the borrowing hereunder as provided in Section 4.04 hereof. Not later than
1:00 p.m. New York time on the date specified for the borrowing hereunder, the
Bank shall make available the amount of the borrowing to the Borrower by
depositing the same, in immediately available funds, in an account of the
Borrower designated by the Borrower.
2.03 Changes of Commitment. The amount of the Commitment
shall be automatically reduced to zero on the Commitment Termination Date,
provided that any portion of the Commitment exceeding the principal amount of
the Loan made pursuant to Section 2.01 hereof shall be automatically
terminated. The Commitment once terminated or reduced may not be reinstated.
2.04 Lending Office. The Loan shall be made and maintained
at the Bank's Applicable Lending Office.
2.05 Note.
(a) The Loan made by the Bank shall be evidenced by a single
promissory note of the Borrower substantially in the form of Exhibit A hereto,
dated the date hereof, payable to the Bank in a principal amount equal to the
amount of the Commitment as originally in effect and otherwise duly completed.
(b) The date and amount of the Loan made by the Bank to the
Borrower, and each payment made on account of the principal thereof, shall be
recorded by the Bank on its books and, prior to any transfer of the Note held
by it, endorsed by the Bank on the schedule attached to the Note or any
continuation thereof; provided that the failure of the Bank to make any such
recordation or endorsement shall not affect the obligations of the Borrower to
make a payment when due of any amount owing hereunder or under the Note in
respect of the Loan.
Credit Agreement
20
- 15 -
(c) The Bank shall not be entitled to have the Note
substituted or exchanged for any reason, or subdivided for promissory notes of
lesser denominations, except in connection with a permitted assignment of all
or any portion of the Loan and Note pursuant to Section 11.06 hereof (and, if
requested by the Bank, the Borrower agrees to so exchange the Note).
2.06 Optional Prepayments. Subject to Section 4.03 hereof,
the Borrower shall have the right to prepay the Loan, at any time or from time
to time, provided that: (a) the Borrower shall give the Bank notice of each
such prepayment as provided in Section 4.04 hereof (and, upon the date
specified in any such notice of prepayment, the amount to be prepaid shall
become due and payable hereunder).
2.07 Mandatory Prepayments.
(a) If a Redetermination Date as determined in accordance with
the terms of the Existing Credit Agreement as of the date hereof shall occur
prior to the Scheduled Maturity Date, the Borrower shall prepay the entire
outstanding principal amount of the Loan and all interest thereon on the third
Business Day following such Redetermination Date.
(b) Upon the sale, transfer or disposition of any of the share
capital of Maersk by any of the Obligors, the Borrower shall prepay the Loan in
an amount no less than the net proceeds from such sale, transfer or disposition
and such amount to be prepaid shall become due and payable on the Business Day
next succeeding the closing date of such sale, transfer or disposition.
Section 3. Payments of Principal and Interest.
3.01 Repayment of Loan. The Borrower hereby promises to pay
to the Bank the entire outstanding principal amount of the Loan, and the Loan
shall mature, on the Maturity Date.
3.02 Interest. The Borrower hereby promises to pay to the
Bank interest on the unpaid principal amount of the Loan for the period from
and including the date of such Loan to but excluding the date such Loan shall
be paid in full, at a rate per annum equal to the Base Rate plus the Applicable
Margin. Notwithstanding the foregoing, the Borrower hereby promises to pay to
the Bank interest at the applicable Post-Default Rate on any principal of the
Loan and on any amount payable by the Borrower hereunder or under the Note that
shall not be paid in full when due (whether at stated maturity, by acceleration
or otherwise) for the period from and including the due date thereof to but
excluding the date the same is paid in full.
Credit Agreement
21
- 16 -
Accrued interest on the Loan shall be payable quarterly on the
Quarterly Dates, and upon the payment or prepayment thereof (but only on the
principal amount so paid or prepaid), except that interest payable at the
Post-Default Rate shall be payable from time to time on demand. Promptly after
the determination of any change in the interest rate, the Bank shall give
notice to the Borrower.
Section 4. Payments; Computations; Etc.
4.01 Payments.
(a) Except to the extent otherwise provided herein, all
payments of principal, interest and other amounts to be made by the Borrower
under this Agreement and the Note, shall be made in Dollars, in immediately
available funds, without deduction, set-off or counterclaim, to the Bank at an
account in New York, New York specified by the Bank, not later than 1:00 p.m.
New York time on the date on which such payment shall become due (each such
payment made after such time on such due date to be deemed to have been made on
the next succeeding Business Day).
(b) The Borrower shall, at the time of making each payment
under this Agreement or the Note, specify to the Bank the Loan or other amount
payable by the Borrower hereunder to which such payment is to be applied
(except that, unless such payment is specified by the Borrower to be a payment
or prepayment of principal required under Section 2.07 or 3.01 hereof or a
payment of interest required to be made under Section 3.02 hereof, if an Event
of Default has occurred and is continuing, the Bank may apply such payment in
such manner as it may deem appropriate).
(c) If the due date of any payment under this Agreement or
the Note would otherwise fall on a day that is not a Business Day, such date
shall be extended to the next succeeding Business Day, and interest shall be
payable for any principal so extended for the period of such extension.
4.02 Computations. Interest on the Loan shall be computed on
the basis of a year of 365 or 366 days, as the case may be, and actual days
elapsed (including the first day but excluding the last day) occurring in the
period for which payable. Notwithstanding the foregoing, for each day that the
Base Rate is calculated by reference to the Federal Funds Rate, interest on the
Loan shall be computed on the basis of a year of 360 days and actual days
elapsed.
4.03 Minimum Amounts. Except for prepayments required
pursuant to Section 2.07 hereof, the borrowing and each partial prepayment of
principal of the Loan shall be in an aggregate amount at least equal to
$1,000,000.
Credit Agreement
22
- 17 -
4.04 Certain Notices. Notices by the Borrower to the Bank of
the borrowing, and optional prepayments of the Loan shall be irrevocable and
shall be effective only if received by the Bank not later than 12:00 noon New
York time on the Business Day prior to the date of the relevant borrowing or
prepayment. Each such notice of borrowing or optional prepayment shall specify
the amount to be borrowed or prepaid and the date of borrowing or optional
prepayment (which shall be a Business Day).
4.05 Setoff. Each Obligor agrees that, in addition to (and
without limitation of) any right of set-off, banker's lien or counterclaim the
Bank may otherwise have, the Bank shall be entitled, at its option (to the
fullest extent permitted by law), to set off and apply any deposit (general or
special, time or demand, provisional or final), or other indebtedness, held by
it for the credit or account of such Obligor at any of its offices, in Dollars
or in any other currency, against any principal of or interest on any of the
Bank's Loan or any other amount payable to the Bank hereunder, that is not paid
when due (regardless of whether such deposit or other indebtedness are then due
to such Obligor), in which case it shall promptly notify such Obligor, provided
that the Bank's failure to give such notice shall not affect the validity
thereof.
Section 5. Yield Protection, Etc.
5.01 Additional Costs.
(a) The Borrower shall pay directly to the Bank from time to
time on request such amounts as the Bank may determine to be necessary to
compensate the Bank (or, without duplication, the holding company of which the
Bank is a subsidiary) for any costs that it determines are attributable to the
maintenance by the Bank (or any Applicable Lending Office or such bank holding
company) of capital in respect of the Commitment or the Loan that it would not
have incurred but for a Regulatory Change (such compensation to include,
without limitation, an amount equal to any reduction of the rate of return on
assets or equity of the Bank (or any Applicable Lending Office or such bank
holding company) to a level below that which the Bank (or any Applicable
Lending Office or such bank holding company) could have achieved but for such
Regulatory Change).
(b) The Bank shall notify the Borrower of any event occurring
after the date hereof entitling the Bank to compensation under paragraph (a) of
this Section 5.01 as promptly as practicable, but in any event within 45 days,
after the Bank obtains actual knowledge thereof; provided that (i) if the Bank
fails to give such notice within 45 days, after it obtains actual knowledge of
such an event, the Bank shall, with respect to compensation payable pursuant to
this Section 5.01 in respect of
Credit Agreement
23
- 18 -
any costs resulting from such event, only be entitled to payment under this
Section 5.01 for costs incurred from and after the date 45 days, prior to the
date that the Bank does give such notice and (ii) the Bank will make all
reasonable efforts to avoid the need for or minimize the amount of such
compensation, including, without limitation, designating a different Applicable
Lending Office for the Loan affected by such event if such designation will
avoid the need for, or reduce the amount of, such compensation and will not, in
the reasonable opinion of the Bank, be disadvantageous to the Bank, except that
the Bank shall have no obligation to designate an Applicable Lending Office
located in the United States of America. The Bank will furnish to the Borrower
a certificate setting forth the basis and amount of each request by the Bank
for compensation under paragraph (a) of this Section 5.01. Determinations and
allocations by the Bank for purposes of this Section 5.01 of the effect of
capital maintained pursuant to paragraph (a) of this Section 5.01, on its costs
or rate of return of maintaining the Loan or its obligation to make the Loan,
or on amounts receivable by it in respect of the Loan, and of the amounts
required to compensate the Bank under this Section 5.01, shall (i) be made in
good faith and on a reasonable basis and (ii) be prima facie evidence of the
Bank's right to receive such compensation.
5.02 U.S. Taxes.
(a) The Borrower agrees to pay to any assignee of the Bank
under Section 11.06(b) hereof that is not a U.S. Person such additional amounts
as are necessary in order that the net payment of any amount due to such
assignee hereunder after deduction for or withholding in respect of any U.S.
Taxes imposed with respect to such payment (or in lieu thereof, payment of such
U.S. Taxes by such non-U.S Person), will not be less than the amount stated
herein to be then due and payable, provided that the foregoing obligation to
pay such additional amounts shall not apply:
(i) to any payment to such assignee hereunder unless on
the date of the assignment to the assignee as provided in Section
11.06(b) hereof) and on the date of any change in the Applicable
Lending Office of such assignee, such assignee submitted to the
Borrower a Form 1001 (relating to such assignee and entitling it to a
complete exemption from withholding on all interest in respect of the
Loan and other amounts to be received by it hereunder) or Form 4224
(relating to all interest in respect of the Loan and other amounts to
be received by such assignee hereunder) and the relevant form, or any
successor form provided in the following paragraph, remains in effect
at the time of payment, or
(ii) to any U.S. Taxes imposed solely by reason of the
failure by such assignee (or, if such assignee is not the beneficial
owner of the relevant amount, such beneficial
Credit Agreement
24
- 19 -
owner) to comply with applicable certification, information,
documentation or other reporting requirements concerning the
nationality, residence, identity or connections with the United States
of America of such assignee (or beneficial owner, as the case may be)
if such compliance is required by statute or regulation of the United
States of America as a precondition to relief or exemption from such
U.S. Taxes.
For the purposes of this Section 5.02(a), (A) "U.S. Person" shall mean a
citizen, national or resident of the United States of America, a corporation,
partnership or other entity created or organized in or under any laws of the
United States of America or any State thereof, or any estate or trust that is
subject to Federal income taxation regardless of the source of its income, (B)
"U.S. Taxes" shall mean any present or future tax, assessment or other charge
or levy imposed by or on behalf of the United States of America or any taxing
authority thereof or therein, (C) "Form 1001" shall mean Form 1001 (Ownership,
Exemption, or Reduced Rate Certificate) of the Department of the Treasury of
the United States of America and (D) "Form 4224" shall mean Form 4224
(Exemption from Withholding of Tax on Income Effectively Connected with the
Conduct of a Trade or Business in the United States) of the Department of the
Treasury of the United States of America (or in relation to either such Form
such successor and related forms as may from time to time be adopted by the
relevant taxing authorities of the United States of America to document a claim
to which such Form relates).
(b) Within 30 days after paying any amount to any assignee of
the Bank under Section 11.06(b) hereof that is not a U.S. Person, from which it
is required by law to make any deduction or withholding, and within 30 days
after it is required by law to remit such deduction or withholding to any
relevant taxing or other authority, the Borrower shall deliver to such assignee
evidence satisfactory to such assignee of such deduction, withholding or
payment (as the case may be).
Section 6. Guarantee.
6.01 The Guarantee. Each of the Subsidiary Guarantors hereby
jointly and severally guarantees to the Bank and its successors and assigns the
prompt payment in full when due (whether at stated maturity, by acceleration or
otherwise) of the principal of and interest on the Loan made by the Bank to,
and, without duplication, the Note of, the Borrower and all other amounts from
time to time owing to the Bank by the Borrower under this Agreement and,
without duplication, under the Note, in each case strictly in accordance with
the terms thereof (such obligations being herein collectively called the
"Guaranteed Obligations"). Each of the Subsidiary Guarantors hereby further
agrees that it is bound jointly (but solely for purposes of Sections 688, 689,
690 and 691
Credit Agreement
25
- 20 -
of the Civil and Commercial Code of Thailand, and each Subsidiary Guarantor
expressly waives any rights it may have under such Sections of the Civil and
Commercial Code of Thailand) with the Borrower and that if the Borrower shall
fail to pay in full when due (whether at stated maturity, by acceleration or
otherwise) any of the Guaranteed Obligations, such Subsidiary Guarantor will
promptly pay the same, without any demand or notice whatsoever, and that in the
case of any extension of time of payment or renewal of any of the Guaranteed
Obligations, the same will be promptly paid in full when due (whether at
extended maturity, by acceleration or otherwise) in accordance with the terms
of such extension or renewal.
6.02 Obligations Unconditional. The obligations of each
Subsidiary Guarantor under Section 6.01 hereof are, to the fullest extent
permitted by law, absolute, irrevocable and unconditional irrespective of the
value, genuineness, validity, regularity or enforceability of the obligations
of the Borrower under this Agreement, the Note or any other agreement or
instrument referred to herein or therein, or any substitution, release or
exchange of any other guarantee of or any security for any of the Guaranteed
Obligations, and, to the fullest extent permitted by applicable law,
irrespective of any other circumstance whatsoever that might otherwise
constitute a legal or equitable discharge or defense of a surety or guarantor,
it being the intent of this Section 6.02 that the obligations of each
Subsidiary Guarantor hereunder shall be absolute and unconditional under any
and all circumstances (other than full and final payment of the Guaranteed
Obligations). Without limiting the generality of the foregoing, it is agreed
that, to the fullest extent permitted by law, the occurrence of any one or more
of the following shall not alter or impair the liability of each Subsidiary
Guarantor hereunder which shall remain absolute and unconditional as described
above:
(i) at any time or from time to time, without notice to
any of the Subsidiary Guarantors, the time for any performance of or
compliance with any of the Guaranteed Obligations shall be extended
(except to the extent otherwise required by Section 11.04 hereof), or
such performance or compliance shall be waived;
(ii) any of the acts mentioned in any of the provisions of
this Agreement or the Note or any other agreement or instrument
referred to herein or therein shall be done or omitted;
(iii) the maturity of any of the Guaranteed Obligations
shall be accelerated, or any of the Guaranteed Obligations shall be
modified, supplemented or amended in any respect, or any right under
this Agreement or the Note or any other agreement or instrument
referred to herein or therein shall be
Credit Agreement
26
- 21 -
waived or any other guarantee of any of the Guaranteed Obligations or
any security therefor shall be released or exchanged in whole or in
part or otherwise dealt with; or
(iv) any lien or security interest granted to, or in favor
of, the Bank as security for any of the Guaranteed Obligations shall
fail to be perfected.
Each Subsidiary Guarantor hereby expressly waives diligence, presentment,
demand of payment, protest and all notices whatsoever, and any requirement that
the Bank exhaust any right, power or remedy or proceed against either or both
of the Borrower or the other Subsidiary Guarantors under this Agreement or the
Note or any other agreement or instrument referred to herein or therein, or
against any other Person under any other guarantee of, or security for, any of
the Guaranteed Obligations. Each Subsidiary Guarantor agrees that its
obligations pursuant to this Section 6 shall not be affected by any assignment
or participation entered into by the Bank pursuant to Section 11.06 hereof.
6.03 Reinstatement. The obligations of each Subsidiary
Guarantor under this Section 6 shall be automatically reinstated if and to the
extent that for any reason any payment by or on behalf of the Borrower in
respect of the Guaranteed Obligations is rescinded or must be otherwise
restored by any holder of any of the Guaranteed Obligations, whether as a
result of any proceedings in bankruptcy or reorganization or otherwise and each
Subsidiary Guarantor agrees that it will indemnify the Bank on demand for all
reasonable costs and expenses (including, without limitation, fees of counsel)
incurred by the Bank in connection with such rescission or restoration,
including any such costs and expenses incurred in defending against any claim
alleging that such payment constituted a preference, fraudulent transfer or
similar payment under any bankruptcy, insolvency or similar law.
6.04 Subrogation. Each Subsidiary Guarantor hereby jointly
and severally agrees that until the payment and satisfaction in full of all
Guaranteed Obligations it shall not exercise any right or remedy arising by
reason of any performance by it of its Guarantee in Section 6.01 hereof,
whether by subrogation or otherwise, against the Borrower or any other
guarantor of any of the Guaranteed Obligations or any security for any of the
Guaranteed Obligations. Each Subsidiary Guarantor agrees that it shall remain
liable for the Guaranteed Obligations in full notwithstanding any act of the
Bank which results in any Subsidiary Guarantor's inability to be subrogated to
the Bank's rights against the Borrower or any Subsidiary Guarantor.
6.05 Remedies. Each Subsidiary Guarantor agrees that, as
between it and the Bank, to the fullest extent permitted by law, its
obligations under this Agreement may be declared to be
Credit Agreement
27
- 22 -
forthwith due and payable as provided in Section 10 hereof (and shall be deemed
to have become automatically due and payable in the circumstances provided in
said Section 10) for purposes of Section 6.01 hereof notwithstanding any stay,
injunction or other prohibition preventing such declaration (or such
obligations from becoming automatically due and payable) as against the
Borrower and that, in the event of such declaration (or such obligations being
deemed to have become automatically due and payable), such obligations (whether
or not due and payable by the Borrower) shall forthwith become due and payable
by such Subsidiary Guarantor for purposes of said Section 6.01.
6.06 Continuing Guarantee. The guarantee in this Section 6
is a continuing guarantee, and shall apply to all Guaranteed Obligations
whenever arising.
6.07 Thai Taxes.
(a) Any and all payments by Thai Xxxx hereunder shall be made
free and clear of, and without deduction or withholding for or on account of,
any taxes, levies, imposts, duties, fees, liabilities or similar charges of the
Kingdom of Thailand or any area subject to the jurisdiction of the Kingdom of
Thailand ("Foreign Taxes") or imposed by any federation or association of or
with which the Kingdom of Thailand may be a member or associated, or by any
jurisdiction from which any payment hereunder is made by Thai Xxxx or any
political subdivision or taxing authority thereof or therein (together with the
Foreign Taxes, the "Applicable Taxes"). If, as a result of any applicable law,
regulations or treaty, or official application or interpretation thereof, Thai
Xxxx is required by law or regulation to make any deduction, withholding or
backup withholding of any Applicable Taxes from any payments to the Bank in
respect of the Guaranteed Obligations the amount payable with respect thereto
will be increased to the amount which, after deduction from such increased
amount of all Applicable Taxes required to be withheld or deducted therefrom,
will yield the amount required under this Agreement to be payable with respect
thereto.
(b) The Bank shall not be entitled to compensation for any
Foreign Taxes incurred by it or withheld from amounts paid to it by reason of
(i) the Bank having some connection with the Kingdom of Thailand, other than
merely the transactions contemplated by this Agreement, (ii) the Bank's failure
to comply with the certification, identification, information or other
reporting requirement concerning its nationality, residence, identity or
connection with the Government of the Kingdom of Thailand or any political
subdivision or taxing authority thereof or therein or (iii) the Bank demanding
compensation more than 45 days after the date such demand was due and, to the
extent the Bank makes such demand after such 45th day, the Bank shall only be
Credit Agreement
28
- 23 -
entitled to such payment with respect to compensation from and after the date
which is 45 days prior to the date such demand is made. The Bank shall not be
entitled to compensation for any Applicable Taxes (excluding Foreign Taxes)
imposed by the United States or any political subdivision or taxing authority
thereof or therein unless the Bank is entitled to receive additional amounts
pursuant to Section 5.02(a) hereof.
(c) The obligations of Thai Xxxx under this Section 6.07
shall survive the payment in full of the Loan and the termination of the
Commitment, and payment in full of the Note.
6.08 Rights of Contribution. The Subsidiary Guarantors
hereby agree, as between themselves, that if any Subsidiary Guarantor shall
become an Excess Funding Obligor (as defined below) by reason of the payment by
such Subsidiary Guarantor of any Guaranteed Obligations, each other Subsidiary
Guarantor shall, on demand of such Excess Funding Obligor (but subject to the
next sentence), pay to such Excess Funding Obligor an amount equal to such
Subsidiary Guarantor's Pro Rata Share (as defined below and determined, for
this purpose, without reference to the Properties, debts and liabilities of
such Excess Funding Obligor) of the Excess Payment (as defined below) in
respect of such Guaranteed Obligations.
For purposes of this Section 6.08, (i) "Excess Funding
Obligor" shall mean, in respect of any Guaranteed Obligations, a Subsidiary
Guarantor that has paid an amount in excess of its Pro Rata Share of such
Guaranteed Obligations, (ii) "Excess Payment" shall mean, in respect of any
Guaranteed Obligations, the amount paid by an Excess Funding Obligor in excess
of its Pro Rata Share of such Guaranteed Obligations and (iii) "Pro Rata Share"
shall mean, for any Subsidiary Guarantor, the ratio (expressed as a percentage)
of (x) the amount by which the aggregate fair saleable value of all Properties
of such Subsidiary Guarantor on the date of this Agreement exceeds the amount
of all the debts and liabilities of such Subsidiary Guarantor (including
contingent, subordinated, unmatured and unliquidated liabilities, but excluding
the obligations that have been Guaranteed by such Subsidiary Guarantor in
Section 6.01 hereof) to (y) the amount by which the aggregate fair saleable
value of all Properties of the Borrower and all of the Subsidiary Guarantors
exceeds the amount of all the debts and liabilities (including contingent,
subordinated, unmatured and unliquidated liabilities, but excluding the
obligations of the Borrower and the Subsidiary Guarantors hereunder) of the
Borrower and all of the Subsidiary Guarantors, all as of the Closing Date.
6.09 General Limitation on Guarantee Obligations. In any
action or proceeding involving any state corporate law, or any state or Federal
bankruptcy, insolvency, reorganization or other law affecting the rights of
creditors generally, if the obligations
Credit Agreement
29
- 24 -
of any Subsidiary Guarantor under Section 6.01 hereof would otherwise, taking
into account the provisions of Section 6.08 hereof, be held or determined to be
void, invalid or unenforceable, or subordinated to the claims of any other
creditors, on account of the amount of its liability under said Section 6.01,
then, notwithstanding any other provision hereof to the contrary, the amount of
such liability shall, without any further action by such Subsidiary Guarantor,
the Bank or any other Person, be automatically limited and reduced to the
highest amount that is valid and enforceable and not subordinated to the claims
of other creditors and determined in such action or proceeding.
Section 7. Conditions Precedent.
7.01 The Loan. The obligation of the Bank to make the Loan
hereunder is subject to the prior or simultaneous satisfaction of the following
conditions (i) such Loan shall be made on or before the Commitment Termination
Date and (ii) the Bank shall have received the following documents, each of
which shall be satisfactory to the Bank in form and substance:
(a) Corporate Documents. The following documents, each
certified as indicated below:
(i) a copy of any amendments subsequent to
September 20, 1996 to the charter of each Obligor (other than
Thai Xxxx), certified as of a date reasonably close to the
Closing Date by the Secretary of State of Delaware, and a
certificate from such Secretary of State dated as of a date
reasonably close to the Closing Date as to the good standing
of and charter documents filed by such Obligor;
(ii) a certificate of the Secretary or an
Assistant Secretary of each Obligor (other than Thai Xxxx),
dated the Closing Date and certifying (A) that attached
thereto is a true and complete copy of the by-laws of such
Obligor as amended and in effect at all times from the date on
which the resolutions referred to in clause (B) below were
adopted to and including the date of such certificate, (B)
that attached thereto is a true and complete copy of
resolutions duly adopted by the board of directors of such
Obligor authorizing the execution, delivery and performance of
such of the Basic Documents to which it is or is intended to
be a party (including the borrowing hereunder), and that such
resolutions have not been modified, rescinded or amended and
are in full force and effect, (C) that the charter documents
of such Obligor have not been amended since the date one day
prior to the certification thereto furnished pursuant to
clause (i) above, and (D) as to the incumbency and
Credit Agreement
30
- 25 -
specimen signature of each officer of such Obligor executing
such of the Basic Documents to which such Obligor is or is
intended to be a party and each other document to be delivered
by such Obligor from time to time in connection therewith (and
the Bank may conclusively rely on such certificate until it
receives notice in writing from such Obligor);
(iii) a certification of another officer of each
Obligor, dated the Closing Date, as to the incumbency and
specimen signature of the Secretary or Assistant Secretary, as
the case may be, of such Obligor;
(iv) Certificates of the appropriate official of
the State of Texas, dated a date reasonably close to the
Closing Date, as to the good standing of, and authority to
transact business of each of the Obligors (other than Thai
Xxxx); and
(v) copies, certified as of the Closing Date, of
any amendments subsequent to September 20, 1996, the
constitutive documents of Thai Xxxx and of all corporate
authority for Thai Xxxx (including, without limitation, board
of director resolutions and evidence of the incumbency,
including specimen signatures, of officers) with respect to
the execution, delivery and performance of the transactions
contemplated by this Agreement (and the Bank may conclusively
rely on such certificate until it receives notice in writing
from Thai Xxxx).
(b) Officer's Certificates. A certificate of a Senior
Officer of each of the Obligors, dated the Closing Date, to the effect
set forth in clauses (a) and (b) of Section 7.02 hereof.
(c) Opinions of Counsel to the Obligors. Opinions, dated the
Closing Date, of (i) Fulbright & Xxxxxxxx LLP, special New York
counsel to the Obligors, substantially in the form of Exhibit B-1
hereto and covering such other matters as the Bank may reasonably
request and (ii) Xxxxx & XxXxxxxx, special Thai counsel to the
Obligors, substantially in the form of Exhibit B-2 hereto and covering
such other matters as the Bank may reasonably request (and each
Obligor hereby instructs each such counsel to deliver such opinions to
the Bank.
(d) Opinions of Special New York Counsel to Chase. An
opinion, dated the Closing Date, of Milbank, Tweed, Xxxxxx & XxXxxx,
special New York counsel to Chase, substantially in the form of
Exhibit C hereto.
Credit Agreement
31
- 26 -
(e) Note. The Note, duly completed and executed.
(f) Project Agreements; Etc. With respect to each of the
Project Agreements, (i) all Project Agreements shall be in full force
and effect, enforceable against each of the parties thereto, and (ii)
there shall not have been any amendment or waiver of any such Project
Agreement since December 31, 1995 (or, in the case of the Crude Sales
Agreement, since November 14, 1996) nor any cancellation, suspension,
termination of or default under, any Project Agreement and the Bank
shall have received a certificate from a Senior Officer of Thai Xxxx
with respect to (i) and (ii) above, which such certificate shall also
certify that all requisite material governmental approvals, consents
and permits required for the development, completion and operation of
the Project have been obtained.
(g) Process Administrative Agent Acceptance. A Process
Administrative Agent Acceptance, duly executed and delivered by CT
Corporation System in respect of each of the Obligors, substantially
in the form of Exhibit G hereto.
(h) Process Agent Power of Attorney for Thai Xxxx. A Process
Agent Power of Attorney for Thai Xxxx, duly executed and delivered by
Thai Xxxx and CT Corporation System, substantially in the form of
Exhibit H hereto.
(i) No Material Adverse Change. There shall have been no
material adverse change since September 30, 1996 in the financial
condition of the Borrower and its Subsidiaries taken as a whole, and
the Bank shall have received a certificate of a Senior Officer of the
Borrower and Thai Xxxx, respectively, to such effect.
(j) Approval of Share Acquisition. All consents, approvals
and actions of, filings with and notices to any Governmental Authority
of or in Thailand necessary to permit the Borrower and Thai Xxxx to
consummate the Share Acquisition shall have been duly obtained, made
or given and shall be in full force and effect, and all terminations
or expirations of waiting periods imposed by any Governmental
Authority necessary for the consummation of the Share Acquisition
shall have occurred.
(k) Amendment No. 1 and Waiver. The Amendment No. 1 and
Waiver dated as of February 21, 1997 to the Existing Credit Agreement,
duly executed and delivered by each of the Obligors and the Majority
Lenders under (and as defined in) the Existing Credit Agreement.
Credit Agreement
32
- 27 -
(l) Other Documents. Such other documents as the Bank or
special New York counsel to the Bank may reasonably request.
7.02 Further Conditions Precedent. The obligation of the
Bank to make the Loan hereunder is subject to the further conditions precedent
that both immediately prior to the making of such Loan and also after giving
effect thereto and to the intended use thereof:
(a) no Default shall have occurred and be continuing; and
(b) the representations and warranties made by the Obligors
in Section 8 and by each Obligor in each of the Basic Documents to
which such Obligor is a party, shall be true and correct on and as of
the date of the making of such Loan with the same force and effect as
if made on and as of such date (or, if any such representation or
warranty is expressly stated to have been made as of a specific date,
as of such specific date).
The notice of borrowing by the Borrower hereunder shall
constitute a certification by the Borrower to the effect set forth in the
preceding sentence (both as of the date of such notice and, unless the Borrower
otherwise notifies the Bank prior to the date of such borrowing, as of the date
of such borrowing).
Section 8. Representations and Warranties. Each Obligor (as
to itself and each of its Subsidiaries) represents and warrants to the Bank
that:
8.01 Corporate Existence. Each Obligor and its Subsidiaries:
(a) is a corporation or other entity duly organized, validly existing and in
good standing under the laws of the jurisdiction of its organization; (b) has
all requisite corporate or other power, and has all material governmental
licenses, authorizations, consents and approvals necessary to own its assets
and carry on its business as now being or as proposed to be conducted; and (c)
is qualified to do business and is in good standing in all jurisdictions in
which the nature of the business conducted by it makes such qualification
necessary and where failure so to qualify could reasonably be expected to
(either individually or in the aggregate) have a Material Adverse Effect.
8.02 Financial Condition. The Borrower has heretofore
furnished to the Bank the following financial statements:
(a) a consolidated balance sheet of the Borrower and its
Subsidiaries as at September 30, 1996 and the related consolidated
statements of income, retained earnings and cash
Credit Agreement
33
- 28 -
flows of the Borrower and its Subsidiaries for the fiscal quarter
ended on said date; and
(b) an audited consolidated balance sheet of the Borrower and
its Subsidiaries as of December 31, 1995 and the related audited
consolidated statements of income, retained earnings and cash flows of
the Borrower and its Subsidiaries for the fiscal year ended on said
date.
All such financial statements are complete and accurate in all material
respects and fairly present in all material respects the actual financial
condition of the Borrower and its Subsidiaries as at said dates and the actual
condition, consolidated results of such operations for the fiscal quarter or
fiscal year ended on said date (subject in the case of clause (a) to normal
year-end audit adjustments), all in accordance with GAAP (to the extent
applicable).
8.03 Litigation. Except as disclosed to the Bank in Schedule
IV hereto, there are no legal or arbitral proceedings, or any proceedings by or
before any Governmental Authority, now pending or (to the knowledge of any
Obligor) threatened against any Obligor or any of its Subsidiaries that could
reasonably be expected to be adversely determined and which, if adversely
determined, could reasonably be expected to (either individually or in the
aggregate) have a Material Adverse Effect.
8.04 No Breach. (a) None of the execution and delivery of
this Agreement and the Note to which any of the Obligors is a party, the
consummation of the transactions herein and therein contemplated or compliance
with the terms and provisions hereof and thereof will conflict with or result
in a breach of, or require any consent (which has not been obtained or the
requirement for which has not been waived) under, the charter or by-laws of any
Obligor, or any agreement or instrument to which any Obligor or any of its
Subsidiaries is a party or by which any of them or any of their Property is
bound or to which any of them is subject, or constitute a default under any
such agreement or instrument, or result in the creation or imposition of any
Lien upon any Property of any Obligor or any of its Subsidiaries pursuant to
the terms of any such agreement or instrument.
(b) None of the execution and delivery of this Agreement and
the Note, the consummation of the transactions herein and therein contemplated
or compliance with the terms and provisions hereof and thereof will violate any
Legal Requirements other than any Legal Requirements the violation of which,
individually or in the aggregate, could not reasonably be expected to have a
Material Adverse Effect.
Credit Agreement
34
- 29 -
8.05 Action. Each Obligor has all necessary corporate power,
authority and legal right to execute, deliver and perform its obligations under
each of the Basic Documents to which it is a party; the execution, delivery and
performance by each Obligor of each of the Basic Documents to which it is a
party have been duly authorized by all necessary corporate action on its part
(including, without limitation, any required shareholder approvals); and this
Agreement has been duly and validly executed and delivered by each Obligor and
constitutes, and the Note when executed and delivered (in the case of the Note,
for value) will constitute, its legal, valid and binding obligation,
enforceable against such Obligor in accordance with its terms, except as such
enforceability may be limited by (a) bankruptcy, insolvency, reorganization,
moratorium or similar laws of general applicability affecting the enforcement
of creditors' rights and (b) the application of general principles of equity
(regardless of whether such enforceability is considered in a proceeding in
equity or at law).
8.06 Approvals. No authorizations, approvals or consents of,
and no filings or registrations with, any Governmental Authority, or any
securities exchange, are necessary for the execution, delivery or performance
by any Obligor of the Basic Documents to which it is a party or for the
legality, validity or enforceability thereof, except for any thereof the
failure of which to be obtained or effected could not, individually or in the
aggregate, reasonably be expected to have a Material Adverse Effect.
8.07 Use of Credit. None of the Obligors nor any of its
Subsidiaries is engaged principally, or as one of its important activities, in
the business of extending credit for the purpose, whether immediate, incidental
or ultimate, of buying or carrying margin stock (as such term is defined in
Regulation U), and no part of the proceeds of the Loan hereunder will be used
to buy or carry any margin stock.
8.08 ERISA. Each Plan, and, to the knowledge of each
Obligor, each Multiemployer Plan, is in compliance in all material respects
with, and has been administered in all material respects in compliance with,
the applicable provisions of ERISA, the Code and any other U.S. Federal or
State law, and no event or condition has occurred and is continuing as to which
any Obligor would be under an obligation to furnish a report to the Bank under
Section 9.01(e) hereof.
8.09 Taxes. The Borrower and its Subsidiaries (other than
Thai Xxxx) are members of an affiliated group of corporations filing
consolidated returns for U.S. Federal income tax purposes, of which the
Borrower is the "common parent" (within the meaning of Section 1504 of the
Code) of such group. The Borrower and its
Credit Agreement
35
- 30 -
Subsidiaries have filed all U.S. Federal income tax returns and all other
material tax returns that are required to be filed by them (or have obtained
extensions with respect thereto) and have paid all taxes due pursuant to such
returns or pursuant to any assessment received by the Borrower or any of its
Subsidiaries. The charges, accruals and reserves on the books of the Borrower
and its Subsidiaries in respect of taxes and other governmental charges are, in
the opinion of the Obligors, adequate. Except as set forth in Schedule V
hereto, none of the Obligors nor any other Person acting on its behalf has
given or been requested to give a waiver of the statute of limitations relating
to the payment of any U.S. Federal, state, local and foreign taxes or other
impositions.
8.10 Investment Company Act. Neither the Borrower nor any of
its Subsidiaries is an "investment company", or a company "controlled" by an
"investment company", within the meaning of the Investment Company Act of 1940,
as amended.
8.11 Public Utility Holding Company Act. Neither the
Borrower nor any of its Subsidiaries is a "holding company", or an "affiliate"
of a "holding company" or a "subsidiary company" of a "holding company", within
the meaning of the Public Utility Holding Company Act of 1935, as amended.
8.12 Material Agreements and Liens.
(a) Part A of Schedule I hereto is a complete and correct
list of each Production Payment, each credit agreement, loan agreement,
indenture, purchase agreement, Guarantee, letter of credit or other arrangement
(other than under the Basic Documents) providing for or otherwise relating to
any Indebtedness or any extension of credit (or commitment for any extension of
credit) to, or Guarantee by, the Borrower or any of its Subsidiaries,
outstanding on the date hereof the aggregate principal or face amount of or
obligations under which equals or exceeds or may equal or exceed $500,000, and
the aggregate principal or face amount outstanding or that may become
outstanding under each such arrangement is correctly described in Part A of
said Schedule I.
(b) Part B of Schedule I hereto is a complete and correct
list of each Lien securing Indebtedness of any Person outstanding on the date
hereof the aggregate principal or face amount of which equals or exceeds or may
equal or exceed $500,000, and covering any Property of the Borrower or any of
its Subsidiaries, and the aggregate Indebtedness secured (or that may be
secured) by each such Lien and the Property covered by each such Lien is
correctly described in Part B of said Schedule I.
8.13 Compliance with Laws. Except as set forth on Schedule
II hereto, each Obligor and its Subsidiaries has prepared and submitted all
reports and has obtained all permits, consents,
Credit Agreement
36
- 31 -
licenses and other authorizations required under all Laws to carry on its
business as now being or as proposed to be conducted, except to the extent
failure to have any such permit, license or authorization could not reasonably
be expected to (either individually or in the aggregate) have a Material
Adverse Effect. Each of such permits, licenses and authorizations is in full
force and effect and each Obligor and its Subsidiaries is in compliance with
(i) the terms and conditions thereof, and (ii) all other limitations,
restrictions, conditions, standards, prohibitions, requirements, obligations,
schedules and timetables contained in any applicable Law, except, in each case,
to the extent failure to comply therewith could not reasonably be expected to
(either individually or in the aggregate) have a Material Adverse Effect.
8.14 Capitalization.
(a) The authorized capital stock of the Borrower consists, on
the date hereof, of (i) an aggregate of 40,000,000 shares of common stock, par
value $.01 of which 25,555,662 shares are duly and validly issued and
outstanding and (ii) an aggregate of 10,000,000 shares of preferred stock, par
value $.01, of which no shares are issued and outstanding, each of which
outstanding common shares is fully paid and nonassessable.
(b) The authorized capital stock of RMEC consists, on the
date hereof, of an aggregate of 10,000 shares of common stock, par value $.01
per share, of which 1000 shares are duly and validly issued and outstanding,
each of which shares is fully paid and nonassessable. As of the date hereof
all of such issued and outstanding shares of common stock are owned
beneficially and of record by the Borrower.
(c) The authorized capital stock of TRH consists, on the date
hereof, of an aggregate of 1000 shares of common stock, par value $.01 of which
1000 shares are duly and validly issued and outstanding, each of which shares
is fully paid and nonassessable. As of the date hereof, such issued and
outstanding shares of common stock are owned beneficially and of record by the
Borrower.
(d) The registered capital of Thai Xxxx consists, on the date
hereof, of an aggregate of 1,065,317 ordinary shares of which 1,065,317 shares
are duly and validly issued and outstanding, each of which shares is fully paid
and nonassessable. As of the date hereof, such issued and outstanding ordinary
shares of common stock are owned beneficially and of record by the Persons as
set forth on Schedule VI hereto.
(e) Based on information provided to the Borrower by Maersk
Olie OG Gas AS in connection with the Share Acquisition, the registered capital
of Maersk consists, on the date hereof of an
Credit Agreement
37
- 32 -
aggregate of Baht 110,000,000 divided into 110,000 ordinary shares, each of
which shares is fully paid and non- assessable.
8.15 Subsidiaries, Etc.
(a) In each case as of the date hereof, the Borrower does not
have any Subsidiaries other than the Subsidiary Guarantors; RMEC and TRH do not
have any Subsidiaries other than Thai Xxxx; and Thai Xxxx has no Subsidiaries.
(b) Set forth in Schedule III hereto is a complete and
correct list as of the date hereof of all Investments (other than operating
deposit accounts with banks and Permitted Investments) held by the Borrower or
any of its Subsidiaries in any Person on the date hereof (including, without
limitation, all interests of the Borrower or any of its Subsidiaries in any
partnership or joint venture ("Partnership Interests") and, for each such
Investment or Partnership Interest, (x) the identity of the Person or Persons
holding such Investment or Partnership Interest (as the case may be) and (y)
the nature of such Investment or Partnership Interest (as the case may be).
Except as disclosed in Schedule III hereto, each of the Borrower and its
Subsidiaries owns, free and clear of all Liens (other than Liens created
pursuant to the Pledge Agreements and other Liens permitted by Section 9.06
hereof), all such Investments and such Partnership Interests.
8.16 Title to Assets. Each Obligor owns or leases and has on
the date hereof indefeasible and defensible title (subject only to Liens
permitted by Section 9.06 hereof) to the material Properties reflected as owned
or leased by it in the most recent financial statements referred to in Section
8.02 hereof (other than Properties disposed of in the ordinary course of
business). Each Obligor owns or leases and has on the date hereof indefeasible
and defensible title to, and enjoys on the date hereof peaceful and undisturbed
possession of, all Properties (subject only to Liens permitted by Section 9.06
hereof) that are necessary for the operation and conduct of its businesses.
8.17 True and Complete Disclosure. The information, reports,
exhibits and schedules furnished in writing by or on behalf of the Obligors to
the Bank in connection with the negotiation, preparation or delivery of this
Agreement and the Note or included herein or therein or delivered pursuant
hereto or thereto, when taken as a whole, are true and correct in all material
respects as of the Closing Date, and do not contain any untrue statement of
material fact or omit to state any material fact necessary to make the
statements herein or therein, in light of the circumstances under which they
were made, not misleading, and any such financial statements fairly present the
financial condition of the Borrower and its Subsidiaries as of the date
indicated therein provided that, in the case of projections and pro
Credit Agreement
38
- 33 -
forma financial statements, the Obligors represent and warrant only that the
same were prepared in good faith and on the basis of assumptions and estimates
that were reasonable as of the date as of which the same are stated to have
been prepared. All written information furnished after the Closing Date by the
Obligors and their respective Subsidiaries to the Bank in connection with this
Agreement and the Note to which any of the Obligors are parties and the
transactions contemplated hereby and thereby will be true, correct and complete
in every material respect on, or (in the case of projections and pro forma
financial statements) will be prepared in good faith and on the basis of
reasonable assumptions and estimates as of, the date as of which such
information is stated or certified.
8.18 Project Agreements; Completion. The Obligors have
heretofore delivered to the Bank true and complete copies of each Project
Agreement each as in effect on the date hereof. Each such Project Agreement to
which Thai Xxxx is a party is in full force and effect as of the Closing Date
and as of the Closing Date no event or condition has occurred or exists that
could result in the termination of such agreement to the extent such
termination would result in a Material Adverse Effect. Thai Xxxx is in
compliance in all material respects, with each of the Project Agreements to
which it is a party. Completion of the Project has been achieved as of January
31, 1997.
8.19 Special Purpose Company. RMEC and TRH have (a) no
material assets other than cash, Investments in Thai Xxxx, Maersk and other
Investments permitted to be made by it as provided in Section 9.08 hereof and
its rights and interests under the documents referred to in clause (b) below
and (b) no Indebtedness, and no material obligations other than its obligations
under the Basic Documents, the Existing Credit Agreement and other Basic
Documents as defined therein and the other documents referred to herein and
therein to which it is a party and Indebtedness permitted by Section 9.07
hereof. Thai Xxxx is not party to any material agreements, contracts or
commitments other than the Project Agreements, the Share Sale Agreement, the
Basic Documents and the Existing Credit Agreement and other Basic Documents as
defined therein and, other than the Project Agreements and certain Hedging
Agreements with the Bank, Thai Xxxx as of the Closing Date does not engage to
any significant degree in business activities in which it incurs or could
reasonably be expected to incur material Indebtedness to Persons other than the
other Obligors.
8.20 SBM. The financing and lease arrangements with SBM in
respect of the Project Agreements have not resulted in any material disruption
to the cash flow of Thai Xxxx or the Borrower and neither Thai Xxxx nor the
Borrower has knowledge of any event or condition (other than the non-payment by
the Operator of amounts
Credit Agreement
39
- 34 -
payable to SBM) which is likely to cause a material disruption of such cash
flow.
8.21 Use of Proceeds. The Borrower will use the proceeds of
the Loan hereunder solely to fund the purchase by Thai Xxxx or one or more of
the other Obligors, pursuant to the terms of a Share Sale Agreement (the "Share
Sale Agreement") dated January 13, 1997 between Maersk Olie OG Gas AS and Thai
Xxxx, of 46.34146% of the outstanding share capital of Maersk (the "Share
Acquisition").
Section 9. Covenants of the Obligors. Each Obligor covenants
and agrees with the Bank that, so long as the Commitment or the Loan is
outstanding and until payment in full of all amounts payable by the Borrower
hereunder:
9.01 Financial Statements Etc. The Borrower shall deliver to
the Bank:
(a) as soon as available and in any event within 55 days
after the end of each quarterly fiscal period of each fiscal year of
the Borrower, consolidated statements of income, changes in
stockholders' equity and cash flows of the Borrower and its
Subsidiaries for such period and for the period from the beginning of
the respective fiscal year to the end of such period, and the related
consolidated balance sheet of the Borrower and its Subsidiaries as at
the end of such period, setting forth in each case in comparative form
the corresponding consolidated figures for the corresponding periods
in the preceding fiscal year (except that, in the case of balance
sheets, such comparison shall be to the last day of the prior fiscal
year), or, if the Borrower is then subject to the periodic reporting
requirements of the Exchange Act, copies of the Borrower's Quarterly
Report on Form 10-Q for such quarterly period as filed with the SEC
containing such consolidated financial statements;
(b) as soon as available and in any event within 100 days
after the end of each fiscal year of the Borrower, consolidated
statements of income, changes in stockholders' equity and cash flows
of the Borrower and its Subsidiaries for such fiscal year and the
related consolidated balance sheet of the Borrower and its
Subsidiaries as at the end of such fiscal year, setting forth in each
case in comparative form the corresponding consolidated figures for
the preceding fiscal year, and accompanied by an opinion thereon of
independent certified public accountants of recognized national
standing, which opinion shall state that said consolidated financial
statements present fairly, in all material respects, the consolidated
financial condition and results of operations of the Borrower and its
Subsidiaries as at the end of, and for,
Credit Agreement
40
- 35 -
such fiscal year in accordance with GAAP or, if the Borrower is then
subject to the periodic reporting requirements of the Exchange Act,
copies of the Borrower's Annual Report on Form 10-K for such fiscal
year as filed with the SEC containing such consolidated financial
statements and opinion;
(c) promptly upon their becoming available, copies of all
registration statements that have been filed and regular periodic
reports (other than as set forth in paragraphs (a) and (b) above), if
any, that the Borrower shall have filed with the Securities and
Exchange Commission (or any governmental agency substituted therefor)
or any national securities exchange;
(d) promptly upon the mailing thereof to the holders of any
publicly-traded debt securities or equity securities of any of the
Obligors generally, copies of all financial statements, reports and
proxy statements so mailed;
(e) as soon as possible, and in any event within ten days
after a Senior Officer of any Obligor knows that any of the events or
conditions specified below with respect to any Plan or Multiemployer
Plan has occurred or exists, a statement signed by a senior financial
officer of such Obligor setting forth details respecting such event or
condition and the action, if any, that such Obligor or its ERISA
Affiliate proposes to take with respect thereto (and a copy of any
report or notice required to be filed with or given to the PBGC by
such Obligor or an ERISA Affiliate with respect to such event or
condition):
(i) any reportable event, as defined in Section
4043 of ERISA and the regulations issued thereunder, with
respect to a Plan, as to which the PBGC has not by regulation
waived the requirement of Section 4043(a) of ERISA that it be
notified within 30 days of the occurrence of such event
(provided that a failure to meet the minimum funding standard
of Section 412 of the Code or Section 302 of ERISA, including,
without limitation, the failure to make on or before its due
date a required installment under Section 412(m) of the Code
or Section 302(e) of ERISA, shall be a reportable event
regardless of the issuance of any waivers in accordance with
Section 412(d) of the Code); and any request for a waiver
under Section 412(d) of the Code for any Plan;
(ii) the distribution under Section 4041 of ERISA
of a notice of intent to terminate any Plan or any action
taken by such Obligor or an ERISA Affiliate to terminate any
Plan;
Credit Agreement
41
- 36 -
(iii) the institution by the PBGC of proceedings
under Section 4042 of ERISA for the termination of, or the
appointment of a trustee to administer, any Plan, or the
receipt by such Obligor or any ERISA Affiliate of a notice
from a Multiemployer Plan that such action has been taken by
the PBGC with respect to such Multiemployer Plan;
(iv) the complete or partial withdrawal from a
Multiemployer Plan by such Obligor or any ERISA Affiliate that
results in liability under Section 4201 or 4204 of ERISA
(including the obligation to satisfy secondary liability as a
result of a purchaser default) or the receipt by such Obligor
or any ERISA Affiliate of notice from a Multiemployer Plan
that it is in reorganization or insolvency pursuant to Section
4241 or 4245 of ERISA or that it intends to terminate or has
terminated under Section 4041A of ERISA;
(v) the institution of a proceeding by a
fiduciary of any Multiemployer Plan against such Obligor or
any ERISA Affiliate to enforce Section 515 of ERISA, which
proceeding is not dismissed within 30 days; and
(vi) the adoption of an amendment to any Plan
that, pursuant to Section 401(a)(29) of the Code or Section
307 of ERISA, would result in the loss of tax-exempt status of
the trust of which such Plan is a part if such Obligor or an
ERISA Affiliate fails to timely provide security to the Plan
in accordance with the provisions of said Sections;
(f) promptly after a Senior Officer of the Borrower or a
Subsidiary Guarantor knows that any Default (other than a Default that
has ceased to exist) has occurred, a notice of such Default describing
the same in reasonable detail and, together with such notice or as
soon thereafter as possible, a description of the action that the
Borrower or such Subsidiary Guarantor, as the case may be, has taken
or proposes to take with respect thereto;
(g) promptly after a Senior Officer of any Obligor becomes
aware thereof, notice of the occurrence of any event or the existence
of any event or condition that could reasonably be expected to result
in the premature termination of any Project Agreement (other than
information previously delivered pursuant to Section 9.17(b) hereof);
(h) as soon as reasonably practicable after its execution by
the parties thereto, the Accounts Agreement; and
Credit Agreement
42
- 37 -
(k) from time to time such other information regarding the
Properties, financial condition, operations or business of any Obligor
and their respective Subsidiaries (including, without limitation, any
Plan or Multiemployer Plan and any reports or other information
required to be filed under ERISA), the Project Agreements, the Sales
Agreements, purchasers under the Sales Agreements and the transactions
contemplated hereby and thereby as the Bank reasonably request.
The Borrower will furnish to the Bank, at the time it furnishes each set of
financial statements pursuant to paragraph (a) or (b) above, a certificate of a
senior financial officer of the Borrower (i) to the effect that no Default has
occurred and is continuing (or, if any Default has occurred and is continuing,
describing the same in reasonable detail and describing the action that the
Obligors have taken or propose to take with respect thereto), (ii) setting
forth in reasonable detail the computations and information necessary to
determine whether the Obligors are in compliance with Sections 9.06(n) and
9.07(e) hereof as of the end of the respective quarterly fiscal period or
fiscal year and (iii) setting forth the amount and parties to any Investments
pursuant to Section 9.08(g) hereof.
Notwithstanding the foregoing, the Borrower shall not be
required to deliver to the Bank the information specified in clauses (a)
through (e) of this Section 9.01 if the Borrower shall have delivered, within
the applicable time periods, such information to the Administrative Agent under
the Existing Credit Agreement.
9.02 Litigation. The Borrower will promptly give to the Bank
notice of all legal or arbitral proceedings, and of all proceedings by or
before any governmental or regulatory authority or agency, and any material
development in respect of such legal or other proceedings, affecting the
Borrower or any of its Subsidiaries, except (i) proceedings that, if adversely
determined, could not (either individually or in the aggregate) reasonably be
expected to have a Material Adverse Effect and (ii) any such development that
could not reasonably be expected to have a Material Adverse Effect.
9.03 Existence, Etc. Each of the Obligors will, and will
cause each of its Subsidiaries to:
(a) preserve and maintain its legal existence and all of its
material rights, privileges, licenses and franchises (provided that
nothing in this Section 9.03 shall prohibit any transaction expressly
permitted under Section 9.05 hereof);
Credit Agreement
43
- 38 -
(b) comply with the requirements of all applicable Laws of
Governmental Authorities if failure to comply with such requirements
could reasonably be expected to (either individually or in the
aggregate) have a Material Adverse Effect;
(c) pay and discharge all taxes, assessments and governmental
charges or levies imposed on it or on its income or profits or on any
of its Property prior to the date on which penalties attach thereto,
except for any such tax, assessment, charge or levy the payment of
which is being contested in good faith and by proper proceedings;
(d) maintain all of its Properties used or useful in its
business in good working order and condition, ordinary wear and tear
excepted;
(e) keep adequate records and books of account in accordance
with GAAP; and
(f) permit representatives of the Bank, during normal
business hours, upon reasonable notice, and at the expense of the
Bank, to examine, copy and make extracts from its books and records,
to inspect any of its Properties, and to discuss its business and
affairs with its officers, all to the extent reasonably requested by
the Bank.
9.04 Insurance. Each of the Obligors will, and will cause
each of its Subsidiaries to, maintain insurance with financially sound and
reputable third party insurance companies with respect to Property and risks of
a character usually maintained by corporations engaged in the same or similar
business similarly situated, against loss, damage and liability of the kinds
and in the amounts customarily maintained by such corporations.
9.05 Prohibition of Fundamental Changes. None of the
Obligors will, nor will they permit any of their Subsidiaries to, enter into
any transaction of merger or consolidation or amalgamation, or liquidate, wind
up or dissolve itself (or suffer any liquidation or dissolution).
Thai Xxxx shall not convey, sell, lease, transfer or otherwise
dispose of any interest in any Project Agreement to which it is a party, and no
Obligor shall make a Disposition.
Notwithstanding the foregoing provisions of this Section 9.05,
the Obligors (other than Thai Xxxx) may merge or consolidate with each other if
(i) in any such merger or consolidation involving the Borrower, the Borrower is
the surviving corporation, (ii) in any such merger or consolidation not
involving the Borrower, a Subsidiary Guarantor is the surviving corporation,
Credit Agreement
44
- 39 -
(iii) after giving effect thereto no Default would exist hereunder and (iv) any
such merger will not have an adverse effect on any Project Agreement.
9.06 Limitation on Liens. None of the Obligors will, nor
will they permit any of their Subsidiaries to, create, incur, assume or suffer
to exist any Lien upon any of its Property, whether now owned or hereafter
acquired, except:
(a) Liens imposed by any governmental authority for taxes,
assessments or charges not yet due or that are being contested in good
faith and by appropriate proceedings;
(b) carriers', warehousemen's, mechanics', materialmen's,
repairmen's, landlord's or other like Liens arising in the ordinary
course of business that are not overdue for a period of more than 30
days or that are being contested in good faith and by appropriate
proceedings and Liens securing judgments but only to the extent for an
amount and for a period not resulting in an Event of Default under
Section 10(h) hereof;
(c) pledges or deposits under worker's compensation,
unemployment insurance and other social security legislation;
(d) deposits, pledges and other Liens granted to secure the
performance of bids, trade contracts (other than for Indebtedness),
leases, tenders, 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 and
encumbrances consisting of zoning restrictions, easements, licenses,
restrictions on the use of Property or minor imperfections in title
thereto that, in the aggregate, are not material in amount, and that
do not in any case materially detract from the value of the Property
subject thereto or interfere with the ordinary conduct of the business
of the Subsidiary Guarantors and any of their respective Subsidiaries;
(f) Liens upon real and/or tangible personal Property
acquired after the date hereof (by purchase, capital lease,
construction or otherwise) by any Obligor, each of which Liens either
(A) existed on such Property before the time of its acquisition and
was not created in anticipation thereof or (B) was created solely for
the purpose of securing Indebtedness representing, or incurred to
finance, refinance or refund, the cost (including the cost of
construction) of such Property; provided that (i) no such Lien shall
extend to
Credit Agreement
45
- 40 -
or cover any Property of any Obligor or any of its Subsidiaries other
than the Property so acquired and improvements thereon, (ii) the
principal amount of Indebtedness secured by any such Lien shall at no
time exceed 75% of the fair market value (as determined in good faith
by a senior financial officer of the Borrower) of such Property at the
time it was acquired (by purchase, construction or otherwise), and
(iii) no Lien shall be incurred in connection with any Production
Payment;
(g) Liens under farm-in, farm-out, joint operating, area of
mutual interest agreements or similar agreements entered into by any
Obligor or any of its Subsidiaries in the ordinary course of business
which such Person determines in good faith to be necessary for or
advantageous to the economic development of its Properties; provided
that no such Lien (other than Liens under joint operating agreements,
which arise in the ordinary course of business) shall be granted upon
Property which is given any value in determining the Borrowing Base;
(h) Liens created pursuant to any Interest Rate Protection
Agreements or Hedging Agreements permitted under Section 9.07(h)
hereof with the Bank or any Lender under the Existing Credit Agreement
that are pari passu or subordinated to the Liens created pursuant to
the Pledge Agreements;
(i) Liens in existence on the date hereof and listed on Part
B of Schedule I hereto;
(j) statutory and contractual landlords' and lessors' liens
under leases to which any Obligor or its Subsidiaries is a party;
(k) any interest or title of a lessor, sublessor, licensee or
licensor under any lease or license agreement permitted by this
Agreement;
(l) Liens in favor of a banking institution arising as a
matter of law encumbering deposits (including the right of set-off)
held by such banking institutions incurred in the ordinary course of
business and which are within the general parameters customary in the
banking industry;
(m) additional Liens created after the date hereof upon real
and/or personal property; provided that (i) the outstanding aggregate
principal or face amount of Indebtedness secured thereby and incurred
after the date hereof shall not exceed $2,500,000 in the aggregate any
one time outstanding and (ii) no such additional Liens shall be
created on any Property of Thai Xxxx;
Credit Agreement
46
- 41 -
(n) Liens in existence on the date hereof, in connection with
Capital Lease Obligations under any capital lease arrangement entered
into by any Obligor;
(o) royalties, overriding royalties, revenue interests, net
revenue interests, advance payment obligations and other similar
burdens incurred in the ordinary course of business; provided that no
such royalties, interests, obligations or burdens shall be granted on
or with respect to Property which is given any value in determining
the Borrowing Base;
(p) Liens on Property of any Person that becomes a Subsidiary
of any Obligor after the date of this Agreement, provided that such
Liens are in existence at the time such Person becomes a Subsidiary of
such Obligor and were not created in anticipation thereof and such
Liens shall not spread to cover any additional Property;
(q) rights reserved to or vested in any municipality or other
Government Authority by the terms of any right, power, franchise,
grant, license or permit, or by any provision of law, to terminate
such right, power, franchise, grant, license or permit or to purchase,
condemn, expropriate or recapture, or to designate a purchaser of, any
of the property of any Obligor or any of its Subsidiaries;
(r) rights reserved to or vested in any municipality or other
Government Authority to control or regulate any property of any
Obligor or any of its Subsidiaries, or to use such property in a
manner which does not materially impair the use of such property for
the purposes for which it is held by such Obligor or any of its
Subsidiaries;
(s) any obligations or duties affecting the Property of any
Obligor or any of its Subsidiaries to any municipality or other
Government Authority with respect to any franchise, grant, license or
permit;
(t) subject to the provisions of Section 9.13 hereof rights
under common law of a common owner of any interest in real estate,
right-of-way or easement held by any Obligor, or any of its
Subsidiaries and such common owner as tenants-in-common or through
other common ownership;
(u) Liens created in respect of the transaction described in
the second sentence of 9.15(a) hereof; and
(v) any extension, renewal or replacement of the foregoing,
provided that the Liens permitted hereunder shall not be spread to
cover any increase in the Indebtedness or to
Credit Agreement
47
- 42 -
cover additional Property (other than a substitution of like
Property).
9.07 Indebtedness. None of the Obligors will, nor will they
permit any of their Subsidiaries to, create, incur or suffer to exist any
Indebtedness except:
(a) Indebtedness hereunder to the Bank;
(b) Indebtedness outstanding on the date hereof and listed in
Part A of Schedule I hereto, together with any renewals, extensions,
modifications and refinancings thereof, provided that (x) no such
renewal, extension, modification or refinancing shall, with respect to
the prior Indebtedness (i) be of an earlier maturity than originally
scheduled or (ii) be of an increased principal amount and (y) the
principal amount of the Indebtedness outstanding under the Existing
Credit Agreement shall not exceed $60,000,000;
(c) Affiliate Subordinated Indebtedness of any Subsidiary
Guarantor; provided that the Borrower specifies to the Bank, at or
prior to the time any Affiliate Subordinated Indebtedness is incurred,
the principal amount thereof and the holder or holders thereof;
(d) Indebtedness incurred by Thai Xxxx to the operator (the
"Operator") under the Operating Agreement in respect of Indebtedness
incurred by the Operator in connection with transactions under such
Operating Agreement or the Joint Operating Agreement and in respect of
which Thai Xxxx and the other parties to such agreements (other than
the Operator) are obligated to reimburse the Operator for their
respective pro rata shares of such Indebtedness of the Operator,
provided that such Indebtedness is repaid prior to the date on which
any interest or penalties accrues or are imposed;
(e) Indebtedness of the Subsidiary Guarantors in respect of
loans and advances made as permitted by Section 9.08(d) hereof;
(f) Non-Recourse Debt;
(g) Guarantees by endorsement of negotiable instruments for
deposit or collection in the ordinary course of business;
(h) Indebtedness in respect of Interest Rate Protection
Agreements and Hedging Agreements (x) existing on the date hereof and
described on Schedule I, Part C hereof or (y) entered into after the
date hereof for the purpose of hedging fluctuations in interest rates,
currency exchange rates and commodity prices and not for speculation;
Credit Agreement
48
- 43 -
(i) Indebtedness incurred in connection with Permitted
Investments of the type described in clause (f) of the definition of
such term;
(j) Indebtedness incurred in respect of the transaction
described in the second sentence of 9.15(a) hereof; and
(k) additional Indebtedness of the Borrower (including,
without limitation, Capital Lease Obligations and other Indebtedness
secured by Liens permitted under Section 9.06(n) hereof) up to but not
exceeding $5,000,000 at any one time outstanding; provided that Thai
Xxxx shall not be the obligor or guarantor with respect to more than
$2,500,000 of such Indebtedness.
9.08 Investments. The Obligors will not, nor will they
permit any of their respective Subsidiaries to, make or permit to remain
outstanding any Investments except:
(a) Investments outstanding on the date hereof and identified
in Part B of Schedule III hereto;
(b) operating deposit accounts with banks;
(c) Permitted Investments;
(d) loans and advances by the Borrower to the Subsidiary
Guarantors and Investments by the Borrower in common stock of, and
other capital contributions by the Borrower to, the Subsidiary
Guarantors;
(e) Investments permitted by 9.07(h);
(f) undivided fractional interests in hydrocarbon reserves
acquired by any Obligor (other than Thai Xxxx, XXXX or TRH) and
additional interests of Thai Xxxx in the hydrocarbon reserves subject
to the Concession Agreement;
(g) Investments incurred in connection with the funding of
Affiliate Subordinated Indebtedness;
(h) Investments by Thai Xxxx referred to in the proviso at
the end of the definition of "Investments" in Section 1.01 hereof;
(i) Investments by one or more of the Obligors in up to
46.35% of the share capital of Maersk; and
(j) additional Investments, including Investments in
Subsidiaries of the Obligors other than Subsidiary Guarantors,
Credit Agreement
49
- 44 -
by the Obligors up to but not exceeding $10,000,000 in the aggregate.
9.09 Restricted Payments. The Borrower will not make any
Restricted Payment at any time. Any provision of this Agreement or the Note
notwithstanding, Thai Xxxx may pay to RMEC and TRH, and RMEC and TRH may pay to
the Borrower, dividends and other distributions on shares of its respective
capital stock and principal and interest on Indebtedness without limitation.
No Subsidiary Guarantor shall and each, to the extent that it is the owner of
any of the share capital thereof, shall use its best efforts to cause Maersk
not to, enter into any agreement that in any manner (i) restricts or prohibits
the payment of dividends and other distribution on its shares of capital stock
or (ii) restricts, prohibits or subordinates (other than (x) to the Lenders
under the Existing Credit Agreement as provided therein and (y) to the Bank as
provided herein) payment of any Indebtedness owed by such Subsidiary Guarantor
to the Borrower.
9.10 Maintenance of Corporate Separateness. The Obligors
will, and will cause each of their respective Subsidiaries to, satisfy
customary corporate formalities, including, without limitation, the holding of
regular board of directors' and shareholders' meetings (or the taking of
actions pursuant to written consents in lieu of such meetings) and the
maintenance of separate corporate records and accounts.
9.11 Lines of Business; Etc. The Obligors will not, nor will
they permit any of their respective Subsidiaries to, engage to any substantial
extent in any line or lines of business activity other than the acquisition,
exploration, development, production, processing and gathering of hydrocarbons
and the marketing and sale of such hydrocarbons, other than the ownership of
the capital stock of their respective subsidiaries and the transactions
reasonably associated therewith (and in no event shall any Obligor or any of
its respective Subsidiaries engage in refining or other "downstream" activities
relating to oil products).
9.12 Transactions with Affiliates. Except as expressly
permitted by this Agreement, the Obligors will not, nor will they permit any of
their respective Subsidiaries to, enter into any transaction directly or
indirectly with or for the benefit of an Affiliate of the Borrower (including,
without limitation, Guarantees and assumptions of obligations of an Affiliate
of the Borrower); except that (1) any Affiliate of the Borrower who is an
individual may serve as a director, officer or employee of the Borrower or any
of its Subsidiaries and receive reasonable compensation for his or her services
in such capacity and (2) the Borrower and its Subsidiaries may enter into other
transactions (other than extensions of credit by the Borrower or any of its
Subsidiaries) with Affiliates of the Borrower providing for the
Credit Agreement
50
- 45 -
leasing of Property, the rendering or receipt of services, the purchase or sale
of inventory and other Property and other transactions in the ordinary course
of business if the monetary or business consideration arising therefrom would
be substantially as advantageous to the Borrower and its Subsidiaries as the
monetary or business consideration that would obtain in a comparable
transaction with a Person not an Affiliate of the Borrower.
9.13 Certain Obligations Respecting Subsidiaries.
(a) The Obligors will take such action from time to time as
shall be necessary to ensure that each Obligor maintains its percentage
ownership interest in each of the Subsidiary Guarantors as set forth on
Schedule III hereto.
(b) The Obligors may only make Investments in Subsidiaries
(other than Subsidiary Guarantors) to the extent permitted by Section 9.08(g)
hereof.
9.14 Limitation on Sale and Leaseback Transactions and
Production Payments.
(a) Neither of the Obligors nor any of their respective
Subsidiaries will enter into, renew or extend any transaction or series of
related transactions pursuant to which the Borrower or any such Subsidiary
sells or transfers any Property in connection with the leasing, or the release
against installment payments, or as part of an arrangement involving the
leasing or resale against installment payments, of such Property to the seller
or transferor ("Sale and Leaseback Transaction"). Notwithstanding the
foregoing, the Bank hereby consents to the contemplated sale and leaseback
transaction described in Schedule VIII hereto.
(b) The Obligors will not, nor will they permit any of their
respective Subsidiaries to, voluntarily agree or consent to enter into any
Production Payment transaction or similar agreement to which any of them are
parties without the prior consent of the Bank.
9.15 Project Agreements.
(a) Thai Xxxx will at all times perform and observe all of
its material obligations under or in respect of the Project Agreements, enforce
all of its material rights and claims under or in respect of such Project
Agreements and take such other actions as shall be necessary to (i) maintain
such Project Agreements in full force and effect and to maintain, preserve and
protect its interests in the Concession Agreement, the Joint Operating
Agreement, and in the other Project Agreements and (ii) cause the Completion of
the Project in accordance with the terms of the Project Agreements.
Credit Agreement
51
- 46 -
(b) The Obligors will not, nor will they permit any of their
respective Subsidiaries to, agree or consent to any modification, supplement or
waiver of any of the provisions of any of the Project Agreements except to the
extent such modifications, supplements and waivers of the Project Agreements
could not reasonably be expected to have (individually or in the aggregate) a
Material Adverse Effect.
9.16 Affiliate Subordinated Indebtedness. The Borrower will
not permit any of its Subsidiaries to, purchase, redeem, retire or otherwise
acquire for value, or set apart any money for a sinking, defeasance or other
analogous fund for the purchase, redemption, retirement or other acquisition
of, or make any voluntary payment or prepayment of the principal of or interest
on, or any other amount owing in respect of, any Affiliate Subordinated
Indebtedness, except (subject to the subordination provisions applicable
thereto) payments permitted by Section 3.02 of the related Affiliate
Subordination Agreement).
9.17 Defaults Under Gas Sales and Certain Actions of Thai
Government Authorities.
(a) The Borrower will notify the Bank within ten days of
(i) PTT's refusal to accept delivery of gas
pursuant to Section 4.2(ii) or 5.2(ii) of the Gas Sales
Agreement for 10 consecutive days;
(ii) the reimbursement by the Concessionaire (as
defined in the Gas Sales Agreement) of costs and expenses
incurred by PTT pursuant to Section 4.2(i) or 5.2(i) of the
Gas Sales Agreement in an amount in excess of $5,000,000 in
any month; or
(iii) any "default" as described in Article XV of
the Gas Sales Agreement.
(b) The Borrower will notify the Bank within ten days of its
receipt of information indicating one or more Government Authorities
of or in Thailand has, or has notified any Obligor in writing or
publicly announced its intention to, repudiate, terminate, seize,
appropriate, assume the management of, abrogate or reduce all or any
material portion of Thai Xxxx'x interest in any of the Project
Agreements.
No notification to the Bank by the Borrower pursuant to this
Section 9.17 shall be required if the Borrower shall have delivered, within the
applicable time periods, such information to the Administrative Agent under the
Existing Credit Agreement.
Credit Agreement
52
- 47 -
9.18 Additional Subsidiary Guarantors. The Borrower will
take such action, and will cause each of its Subsidiaries to take such action,
including without limitation the action specified below in this Section 9.18
from time to time as shall be necessary to ensure that each Subsidiary that has
interests in oil or gas reserves that the Borrower seeks to include in the
Borrowing Base is a Subsidiary Guarantor hereunder. Each Subsidiary of the
Borrower that is required to become a Subsidiary Guarantor after the date
hereof shall execute such instruments and agreements, in form and substance
reasonably satisfactory to, and as reasonably required by, the Bank to
acknowledge that such Subsidiary has all of the obligations of a Subsidiary
Guarantor pursuant to this Agreement.
Section 10. Events of Default. If one or more of the
following events (herein called "Events of Default") shall occur and be
continuing:
(a) the Borrower shall default in the payment when due
(whether at stated maturity or upon mandatory or optional prepayment)
of: (i) any principal of the Loan; or (ii) any interest on the Loan
or any other amount payable by it hereunder or under the Note if not
paid within three Business Days of the date that the same shall become
due; or
(b) the Borrower or any of its Subsidiaries shall default in
the payment when due of any principal of or interest on any of its
other Indebtedness aggregating $1,000,000 or more, or in the payment
when due of any amount under any Interest Rate Protection Agreement or
Hedging Agreement for a notional principal amount exceeding
$1,000,000; or
(c) Any representation or warranty made or deemed made herein
or in the Note (or in any modification or supplement hereto or
thereto) by or on behalf of any Obligor, or any certificate furnished
to the Bank pursuant to the provisions hereof or thereof, shall prove
to have been false or misleading as of the time made or furnished in
any material respect; or
(d) The Borrower or any Subsidiary Guarantor shall default in
the performance of any of its obligations under any of Sections
9.01(f), 9.01(g), 9.03(a), 9.05, 9.06, 9.07, 9.08, 9.09, 9.14, 9.15(b)
or 9.16 hereof; or any Obligor shall default in the performance of its
obligation under Section 9.15(a) hereof and such default shall
continue unremedied for a period of 15 or more days after notice
thereof to the Borrower by the Bank; or any Obligor shall default in
the performance of any of its other obligations in this Agreement or
any other Basic Document and such default
Credit Agreement
53
- 48 -
shall continue unremedied for a period of 30 or more days after notice
thereof to the Borrower by the Bank; or
(e) Any Obligor shall admit in writing its inability to, or
be generally unable to, pay its debts as such debts become due; or
(f) Any Obligor shall (i) apply for or consent to the
appointment of, or the taking of possession by, a receiver, custodian,
trustee, examiner or liquidator of itself or of all or a substantial
part of its Property, (ii) make a general assignment for the benefit
of its creditors, (iii) commence a voluntary case under the Bankruptcy
Code, (iv) file a petition seeking to take advantage of any other law
relating to bankruptcy, insolvency, reorganization, liquidation,
dissolution, arrangement or winding-up, or composition or readjustment
of debts, (v) fail to controvert in a timely and appropriate manner,
or acquiesce in writing to, any petition filed against it in an
involuntary case under the Bankruptcy Code, (vi) take any corporate
action for the purpose of effecting any of the foregoing or (vii) do
the equivalent of any of the foregoing under any foreign laws; or
(g) A proceeding or case shall be commenced, without the
application or consent of any Obligor, in any court of competent
jurisdiction, seeking (i) its reorganization, liquidation,
dissolution, arrangement or winding-up, or the composition or
readjustment of its debts, (ii) the appointment of a receiver,
custodian, trustee, examiner, liquidator or the like of such Obligor
or of all or any substantial part of its Property, (iii) similar
relief in respect of such Obligor under any law relating to
bankruptcy, insolvency, reorganization, winding-up, or composition or
adjustment of debts, and such proceeding or case shall continue
undismissed, or an order, judgment or decree approving or ordering any
of the foregoing shall be entered and continue unstayed and in effect,
for a period of 60 or more days; or an order for relief against such
Obligor shall be entered in an involuntary case under the Bankruptcy
Code or (iv) the equivalent of any of the foregoing under any foreign
laws; or
(h) A final judgment or order for the payment of money shall
be entered against any Obligor (i) which, within 90 days after the
entry thereof, has not been discharged or execution thereof has not
been stayed pending appeal or as to which any enforcement proceeding
shall have been commenced (and not stayed) by any creditor thereon and
(ii) the aggregate amount of all such final judgments or orders
meeting the criteria set forth in clause (i) above exceeds $1,000,000
(net of insurance coverage as to which the insurer has acknowledged
coverage); or
Credit Agreement
54
- 49 -
(i) An event or condition specified in Section 9.01(e) hereof
shall occur or exist with respect to any Plan or Multiemployer Plan
and, as a result of such event or condition, together with all other
such events or conditions, any Obligor or any ERISA Affiliate shall
incur a liability to a Plan, a Multiemployer Plan or the PBGC (or any
combination of the foregoing) that could reasonably be expected to
(either individually or in the aggregate) have a Material Adverse
Effect; or
(j) All of the outstanding shares of capital stock of Thai
Xxxx (other than Qualifying Shares) shall cease to be owned, directly
or indirectly, by the Borrower, or any of such shares (other than
Qualifying Shares) shall be owned, directly or indirectly, by an
entity which is not incorporated or organized under the laws of a
state of the United States of America and the business of which does
not consist solely of making and holding investments in the Subsidiary
Guarantors and in other Investments permitted by Section 9.08 hereof;
or
(k) The Borrower's percentage ownership interest in RMEC and
TRH, and RMEC's and TRH's percentage ownership interests in Thai Xxxx
shall decrease from their respective percentage ownership interests on
the date hereof as set forth in Schedule VII hereto; or the Qualifying
Shares of Thai Xxxx shall at any time constitute more than 1% of the
voting and economic interests in Thai Xxxx; or
(l) Any Property of any Obligor is seized pursuant to legal
process and not bonded within 30 days; or
(m) There shall occur a revocation of, repeal of, termination
prior to the scheduled term of, or default under, any Project
Agreement or any Project Agreement shall cease to be in full force and
effect in any material respect; or
(n) One or more Government Authorities of the Kingdom of
Thailand shall publicly announce its intention to or shall repudiate,
terminate, seize, appropriate, assume management of, abrogate or
reduce all or any material portion of the Concession Agreement, or the
rights, properties or interests subject thereto or take any of the
following actions that results in a Material Adverse Effect: (i)
suspending or terminating all or any material portion of the
production or exportation of hydrocarbons subject to the Concession
Agreement, (ii) subjecting Thai Xxxx or Maersk to new or additional
Taxes or imposing currency controls that prevent Thai Xxxx or Maersk
from converting payments to U.S. Dollars or prevent Thai Xxxx or
Maersk from transferring such payment outside of the Kingdom of
Thailand or (iii) the confiscation, expropriation or nationalization
of the Project, any Project
Credit Agreement
55
- 50 -
Property, or other assets used in the exploration or development of
Block B8/32 by any Government Authority of the Kingdom of Thailand or
any other Government Authority; or
(o) The Project is abandoned or placed in a care and
maintenance basis, or a substantial part of the Project Property is
destroyed or damaged beyond repair except where such destruction or
damage would not have a Material Adverse Effect; or
(p) Thai Xxxx or Maersk ceases to receive, for more than 30
consecutive days, the proceeds from the sale of its hydrocarbons, net
of lease or other similar payments owed to SBM and its Affiliates, and
such failure to receive such payments results in a Material Adverse
Effect; or
(q) any event or condition occurs that results in an Event of
Default as defined in the Existing Credit Agreement (or any of the
other Basic Documents as such term is defined in the Existing Credit
Agreement).
THEREUPON: (1) in the case of an Event of Default other than one referred to
in clause (f) or (g) of this Section 10 with respect to the Borrower or any
Subsidiary Guarantor, the Bank may, by notice to the Borrower, terminate the
Commitment and/or declare the principal amount then outstanding of, and the
accrued interest on, the Loan and all other amounts payable by the Borrower and
the Subsidiary Guarantors hereunder and under the Note to be forthwith due and
payable, whereupon such amounts shall be immediately due and payable without
presentment, demand, protest or other formalities of any kind, all of which are
hereby expressly waived by the Obligors; and (2) in the case of the occurrence
of an Event of Default referred to in clause (f) or (g) of this Section 10 with
respect to the Borrower or any Subsidiary Guarantor, the principal amount then
outstanding of, and the accrued interest on, the Loan and all other amounts
payable by the Obligors hereunder and under the Note shall automatically become
immediately due and payable without presentment, demand, protest or other
formalities of any kind, all of which are hereby expressly waived by the
Obligors.
Section 11. Miscellaneous.
11.01 Waiver. No failure on the part of the Bank to exercise
and no delay in exercising, and no course of dealing with respect to, any
right, power or privilege under this Agreement or the Note shall operate as a
waiver thereof, nor shall any single or partial exercise of any right, power or
privilege under this Agreement or the Note preclude any other or further
exercise thereof or the exercise of any other right, power or privilege. The
remedies provided herein are cumulative and not exclusive of any remedies
provided by law.
Credit Agreement
56
- 51 -
11.02 Notices. All notices, requests and other
communications provided for herein (including, without limitation, any
modifications of, or waivers, requests or consents under, this Agreement) shall
be given or made in writing (including, without limitation, by telecopy)
delivered to the intended recipient at the "Address for Notices" specified
below its name on the signature pages hereof); or, as to any party, at such
other address as shall be designated by such party in a notice to each other
party. Except as otherwise provided in this Agreement, all such communications
shall be deemed to have been duly given when transmitted by telecopier or
personally delivered or, in the case of a mailed notice, upon receipt, in each
case given or addressed as aforesaid.
11.03 Expenses, Etc. The Borrower agrees to pay or
reimburse the Bank for (without duplication): (a) all reasonable out-of-pocket
costs and expenses of the Administrative Agent (including, without limitation,
following presentation of a reasonably detailed invoice therefor, the
reasonable fees and expenses of Milbank, Tweed, Xxxxxx & XxXxxx, special New
York counsel to the Bank, and the Law Office of Paiboon Sutuntivorakoon Ltd.,
special Thai counsel to the Bank (if applicable), in connection with (i) the
negotiation, preparation, execution and delivery of this Agreement and the Note
and the making of the Loan hereunder and related matters and (ii) the
negotiation or preparation of any modification, supplement or waiver of any of
the terms of this Agreement or the Note or any Affiliate Subordination
Agreement (whether or not consummated); (b) all reasonable out-of-pocket costs
and expenses of the Bank (including, without limitation, the reasonable fees
and expenses of legal counsel) in connection with (i) any Event of Default and
any enforcement or collection proceedings resulting therefrom, including,
without limitation, all manner of participation in or other involvement with
(x) bankruptcy, insolvency, receivership, foreclosure, winding up or
liquidation proceedings, (y) judicial or regulatory proceedings and (z)
workout, restructuring or other negotiations or proceedings (whether or not the
workout, restructuring or transaction contemplated thereby is consummated) and
(ii) the enforcement of this Section 11.03; and (c) without duplication of any
amounts payable by the Borrower under Section 5.02 hereof, all transfer, stamp,
documentary or other similar taxes, assessments or charges levied by any
governmental or revenue authority in respect of this Agreement or the Note or
any other document referred to herein or therein.
The Borrower hereby agrees to indemnify the Bank and its
directors, officers, employees, attorneys and agents from, and hold each of
them harmless against, any and all losses, liabilities, claims, damages or
expenses incurred by any of them, whether or not the Bank is a party thereto
arising out of or by reason of any investigation or litigation or other
proceedings (including any
Credit Agreement
57
- 52 -
threatened investigation or litigation or other proceedings) relating to the
Loan hereunder or any of the other transactions contemplated hereby or any
actual or proposed use by the Borrower or any of its Subsidiaries of the
proceeds of the Loan hereunder, including, without limitation, the reasonable
fees and disbursements of counsel incurred in connection with any such
investigation or litigation or other proceedings (but excluding any such
losses, liabilities, claims, damages or expenses incurred by reason of the
gross negligence or willful misconduct of the Person to be indemnified).
Without limiting the generality of the foregoing, the Borrower will indemnify
the Bank from, and hold the Bank harmless against, any losses, liabilities,
claims, damages or expenses described in the preceding sentence (but excluding,
as provided in the preceding sentence, any loss, liability, claim, damage or
expense incurred by reason of the gross negligence or willful misconduct of the
Person to be indemnified) arising under any Law as a result of the past,
present or future operations of the Borrower or any of its Subsidiaries (or any
predecessor in interest to the Borrower or any of its Subsidiaries), or the
past, present or future condition of any site or facility owned, operated or
leased at any time by the Borrower or any of its Subsidiaries (or any such
predecessor in interest), including any such losses, liabilities, claims,
damages or expenses that shall occur during any period when the Bank shall be
in possession of any such site or facility following the exercise by the Bank
of any of its rights and remedies hereunder to the extent that such losses,
liabilities, claims, damages or expenses are caused by the Bank (but not if
such losses, liabilities, claims, damages or expenses are caused by the gross
negligence or willful misconduct of the Bank).
11.04 Amendments, Etc. Except as otherwise expressly
provided in this Agreement, any provision of this Agreement may be modified or
supplemented only by an instrument in writing signed by the Borrower, the
Subsidiary Guarantors, and the Bank, and any provision of this Agreement may be
waived by the Bank.
Notwithstanding any provision to the contrary in the Existing
Credit Agreement (including, without limitation, Sections 11.09 and 12.04
thereof), no modification, supplement or waiver of the Existing Credit
Agreement shall, unless by an instrument signed by the Bank, waive any of the
rights and remedies of the Bank hereunder.
11.05 Successors and Assigns. This Agreement shall be
binding upon and inure to the benefit of the parties hereto and their
respective successors and permitted assigns.
11.06 Assignments and Participations.
Credit Agreement
58
- 53 -
(a) Neither the Borrower nor any of the Subsidiary Guarantors
may assign any of its rights or obligations hereunder or under the Note without
the prior consent of the Bank.
(b) The Bank may assign the Loan and the Note, with the
consent, so long as no Event of Default shall have occurred and be continuing,
of the Borrower (such consent not to be unreasonably withheld or delayed);
provided that
(i) except to the extent the Bank and the Borrower shall
otherwise consent, any such partial assignment (other than to a Lender
under the Existing Credit Agreement) shall be in an amount at least
equal to $5,000,000;
(ii) each such assignment by the Bank of the Loan or the
Note shall be made in such manner so that the same portion of the Loan
and Commitment is assigned to the respective assignee; and
(iii) upon each such assignment, the assignor and assignee
shall deliver to the Borrower an Assignment and Acceptance in the form
of Exhibit E hereto.
Upon execution and delivery by the assignor and the assignee to the Borrower of
such Assignment and Acceptance, and upon consent thereto by the Borrower to the
extent required above, the assignee shall have, to the extent of such
assignment (unless otherwise consented to by the Borrower), the obligations,
rights and benefits of the Bank hereunder holding the Loan (or portions
thereof) assigned to it and specified in such Assignment and Acceptance.
(c) The Bank may sell or agree to sell to one or more other
Persons a participation in all or any part of the Loan held by it (such
purchaser of a participation a "Participant"), but a Participant shall not have
any other rights or benefits under this Agreement or the Note and any Affiliate
Subordination Agreement (the Participant's rights against the Bank in respect
of such participation to be those set forth in the agreements executed by the
Bank in favor of the Participant). All amounts payable by the Borrower to the
Bank under Section 5 hereof and Section 11.03 hereof in respect of the Loan
held by it and the Commitment shall be determined as if the Bank had not sold
or agreed to sell any participations in the Loan and Commitment, and as if the
Bank were funding such Loan in the same way that it is funding the portion of
such Loan and Commitment in which no participations have been sold. In no
event shall the Bank agree with the Participant to take or refrain from taking
any action hereunder or under the Note and any Affiliate Subordination
Agreement except that the Bank may agree with the Participant that it will not,
without the consent of the Participant, agree to (i) extend the date fixed for
the payment of principal of or interest on the Loan or any portion of any fee
Credit Agreement
59
- 54 -
hereunder payable to the Participant, (ii) reduce the amount of any such
payment of principal, (iii) reduce the rate at which interest is payable
thereon, or any fee hereunder payable to the Participant, to a level below the
rate at which the Participant is entitled to receive such interest or fee or
(iv) alter the rights or obligations of the Borrower to prepay the Loan.
(d) In addition to the assignments and participations
permitted under the foregoing provisions of this Section 11.06, the Bank may
(without notice to or the consent of the Borrower and without payment of any
fee) (i) assign and pledge all or any portion of the Loan and the Note to any
Federal Reserve Bank as collateral security pursuant to Regulation A and any
Operating Circular issued by such Federal Reserve Bank and (ii) assign all or
any portion of its rights under this Agreement and the Loan and the Note to an
affiliate. No such assignment shall release the Bank from its obligations
hereunder.
(e) The Bank may furnish any information concerning the
Borrower, the Subsidiary Guarantors or any of their respective Subsidiaries in
the possession of the Bank from time to time to assignees and participants
(including prospective assignees and participants), subject, however, to the
provisions of Section 11.12 hereof.
11.07 Survival. The obligations of the Borrower under
Sections 5.01, 5.02, and 11.03 hereof and the obligations of the Subsidiary
Guarantors under Section 6.03 hereof, and the obligations of the Bank under
Section 11.12 hereof, shall survive the repayment of the Loan and the
termination of the Commitment. In addition, each representation and warranty
made, or deemed to be made by the notice of the Loan, herein or pursuant hereto
shall survive the making of such representation and warranty, and the Bank
shall not be deemed to have waived, by reason of making the Loan, any Default
that may arise by reason of such representation or warranty proving to have
been false or misleading, notwithstanding that the Bank may have had notice or
knowledge or reason to believe that such representation or warranty was false
or misleading at the time the Loan was made.
11.08 Captions. The table of contents and captions and
section headings appearing herein are included solely for convenience of
reference and are not intended to affect the interpretation of any provision of
this Agreement.
11.09 Counterparts. This Agreement may be executed in any
number of counterparts, all of which taken together shall constitute one and
the same instrument and any of the parties hereto may execute this Agreement by
signing any such counterpart.
Credit Agreement
60
- 55 -
11.10 Governing Law; Submission to Jurisdiction. (a) This
Agreement and the Note shall be governed by, and construed in accordance with,
the law of the State of New York. The Borrower and the Subsidiary Guarantors
hereby submit to the nonexclusive jurisdiction of the United States District
Court for the Southern District of New York and of the Supreme Court of the
State of New York sitting in New York County (including its Appellate
Division), and of any other appellate court in the State of New York, for the
purposes of all legal proceedings arising out of or relating to this Agreement
or the Note or the transactions contemplated hereby or thereby. Each of the
Borrower and the Subsidiary Guarantors hereby irrevocably waives, to the
fullest extent permitted by applicable law, any objection that it may now or
hereafter have to the laying of the venue of any such proceeding brought in
such a court and any claim that any such proceeding brought in such a court has
been brought in an inconvenient forum.
Each Obligor agrees that final judgment in any such suit,
action or proceeding brought in such court shall be conclusive and binding upon
such Obligor and may be enforced in any court to the jurisdiction of which such
Obligor is subject by a suit upon such judgment, provided that service of
process is effected upon such Obligor in the manner provided in this Section
11.10.
(b) Each Obligor (other than Thai Xxxx) hereby agrees that
service of all writs, process and summonses in any such suit, action or
proceeding brought in the State of New York may be made upon it by service upon
CT Corporation System, presently having an office at 0000 Xxxxxxxx, Xxx Xxxx,
Xxx Xxxx 00000, X.X.X. (each of such agents for service of process as
appropriate, being referred to herein as the "Process Agent"), and each Obligor
(other than Thai Xxxx) hereby irrevocably appoints the Process Agent its true
and lawful agent and attorney-in-fact in its name, place and stead to accept
such service of any and all such writs, process and summonses and agrees that
the failure of the Process Agent to give any notice of any such service of
process to any such Obligor shall not impair or affect the validity of such
service or of any judgment based thereon. If for any reason CT Corporation
System ceases to act, or to be able to act, as a Process Agent, as contemplated
hereby, each Obligor (including Thai Xxxx) will appoint a substitute therefor
and agrees to maintain at all times an agent for service of process in the
United States of America to act as its process agent. Each Obligor (including
Thai Xxxx) irrevocably consents to the service of process in any suit, action
or proceeding in said courts by the mailing thereof by the Bank or any holder
of the Note by registered or certified mail, postage prepaid, to such Obligor
at the address given below its name on the signature pages hereto.
(c) Nothing herein shall in any way be deemed to limit the
ability of the Bank to serve any such writs, process or
Credit Agreement
61
- 56 -
summonses in any other manner permitted by applicable law or to obtain
jurisdiction over the Obligors in such other jurisdictions, and in such manner,
as may be permitted by applicable law.
(d) To the extent that any Borrower or any Subsidiary
Guarantor has or hereafter may acquire any immunity from jurisdiction of any
court or from any legal process (whether through service of notice, attachment
prior to judgment, attachment in aid of execution, execution, sovereign
immunity or otherwise) with respect to itself or its property, it hereby
irrevocably waives such immunity in respect of its obligations under this
Agreement and the Note.
11.11 Waiver of Jury Trial. EACH OF THE BORROWER, EACH
SUBSIDIARY GUARANTOR AND THE BANK HEREBY IRREVOCABLY WAIVES, TO THE FULLEST
EXTENT PERMITTED BY APPLICABLE LAW, ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY
LEGAL PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT, THE NOTE OR THE
TRANSACTIONS CONTEMPLATED HEREBY.
11.12 Treatment of Certain Information; Confidentiality. The
Bank agrees (on behalf of itself and each of its affiliates, directors,
officers, employees and representatives) with each of the Obligors to use its
best efforts to keep confidential and not to disclose any non-public
information supplied to it by any of the Obligors pursuant to this Agreement or
the Note that is identified by any of the Obligors as being confidential at the
time the same is delivered to the Bank, provided that nothing herein shall
limit the disclosure of any such information (i) to the extent required by
statute, rule, regulation or judicial process, (ii) to counsel for the Bank,
(iii) to bank examiners, auditors or accountants, (iv) to the Bank (or to Chase
Securities Inc., Chase Investment Bank, Ltd., and Chase Manhattan Asia
Limited), (v) in connection with any litigation relating to any of the Basic
Documents or any Affiliate Subordination Agreement or the transactions
contemplated thereby to which the Bank is a party, (vi) to a subsidiary or
affiliate of the Bank in connection with the administration, management or
booking of the Loan or (vii) to any assignee or participant (or prospective
assignee or participant) so long as such assignee or participant (or
prospective assignee or participant) first executes and delivers to the Bank a
Confidentiality Agreement substantially in the form of Exhibit D hereto. The
obligations of the Bank under this Section 11.12 shall supersede and replace
the obligations of the Bank under any confidentiality letter in respect of this
financing signed and delivered by the Bank to any of the Obligors prior to the
date hereof; in addition, the obligations of any assignee that has executed a
Confidentiality Agreement in the form of Exhibit D hereto shall be superseded
by this Section 11.12 upon the date upon which such assignee becomes a lender
hereunder pursuant to Section 11.06(b) hereof.
Credit Agreement
62
- 57 -
11.13 Appointment of the Borrower as Agent. Each Subsidiary
Guarantor hereby irrevocably appoints the Borrower as its agent for the purpose
of giving and receiving any and all notices and other communications provided
for herein to be given by or to it hereunder. By its signature below, the
Borrower hereby accepts such appointment.
11.14 Joint and Several Liability. (a) All monetary
obligations of the Subsidiary Guarantors hereunder and under the Note to which
the Subsidiary Guarantors are parties shall be their joint and several
obligations.
(b) Each Subsidiary Guarantor hereby agrees that until the
payment and satisfaction in full of all monetary obligations hereunder and the
expiration or termination of the Commitment it shall not exercise any right or
remedy against any other Subsidiary Guarantor arising by reason of any
performance by it of its joint and several obligations hereunder, whether by
subrogation or otherwise.
11.15 Judgment Currency. If, under any applicable law and
whether pursuant to a judgment being made or registered against any Obligor or
for any other reason, any payment under or in connection with this Agreement is
made or fails to be satisfied in a currency (the "Other Currency") other than
that in which the relevant payment is due (the "Required Currency") then, to
the extent of the payment (when converted into the Required Currency at the
rate of exchange on the date of payment, or, if it is not practicable for the
party entitled thereto (the "Payee") to purchase the Required Currency with the
Other Currency on the date of payment, at the rate of exchange as soon
thereafter as it is practicable for it to do so) actually received by the Payee
falls short of the amount due under the terms of this Agreement, such Obligor
shall, to the extent permitted by law, as a separate and independent
obligation, indemnify and hold harmless the Payee against the amount of such
shortfall. For the purpose of this Section, "rate of exchange" means the rate
at which the Payee is able on the relevant date to purchase the Required
Currency with the Other Currency and shall take into account any premium and
other costs of exchange.
Credit Agreement
63
- 58 -
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed and delivered as of the day and year first above
written.
BORROWER
XXXXXXXXXX--XXXXX OIL CORPORATION
By /s/ Xxxxx X. Xxxxxxxxx
----------------------------------
Title: Chief Financial Officer
Address for Notices:
Xxxxxxxxxx--Xxxxx Oil Corporation
0 Xxxxxxxx Xxxxx, Xxxxx 000
Xxxxxxx, Xxxxx 00000
Attention: Chief Financial Officer
Telecopier No.: 000-000-0000
Telephone No.: 000-000-0000
Credit Agreement
64
- 59 -
SUBSIDIARY GUARANTORS
XXXXXXXXXX--XXXXX EXPLORATION COMPANY
By /s/ Xxxxx X. Xxxxxxxxx
--------------------------------
Title: Treasurer
Address for Notices:
Xxxxxxxxxx--Xxxxx Exploration
Company
0 Xxxxxxxx Xxxxx, Xxxxx 000
Xxxxxxx, Xxxxx 00000
Attention: Chief Financial Officer
Telecopier No.: 000-000-0000
Telephone No.: 000-000-0000
THAI XXXX HOLDINGS, INC
By /s/ Xxxxx X. Xxxxxxxxx
---------------------------------
Title: Treasurer
Address for Notices:
Thai Xxxx Holdings, Inc.
0 Xxxxxxxx Xxxxx, Xxxxx 000
Xxxxxxx, Xxxxx 00000
Attention: Chief Financial Officer
Telecopier No.: 000-000-0000
Telephone No.: 000-000-0000
Credit Agreement
65
- 60 -
THAI XXXX LIMITED
By Xxxxx X. Xxxxxxxxx
------------------------------------
Title: Managing Director
Address for Notices:
Thai Xxxx Holdings, Inc.
0 Xxxxxxxx Xxxxx, Xxxxx 000
Xxxxxxx, Xxxxx 00000
Attention: Chief Financial Officer
Telecopier No.: 000-000-0000
Telephone No.: 000-000-0000
Credit Agreement
66
- 61 -
THE BANK
Commitment THE CHASE MANHATTAN BANK
----------
$20,000,000
By /s/ Xxxxxx Xxxxxx
------------------------------
Title: Vice President
Lending Office for the Loan:
The Chase Manhattan Bank
000 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Address for Notices:
The Chase Manhattan Bank
0 Xxxxx Xxxxxxxxx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Telecopier No.: 212-552-1687
Telephone No.: 000-000-0000
Credit Agreement
67
PROMISSORY NOTE
$20,000,000 February 26, 0000
Xxx Xxxx, Xxx Xxxx
FOR VALUE RECEIVED, XXXXXXXXXX--XXXXX OIL CORPORATION, a
Delaware corporation (the "Borrower"), promises to pay to the order of THE
CHASE MANHATTAN BANK (the "Bank"), for its account at the principal office of
the Bank in New York, New York, the principal sum of $20,000,000 Dollars (or
such lesser amount as shall equal the aggregate unpaid principal amount of the
Loan made by the Bank to the Borrower under the Credit Agreement), in lawful
money of the United States of America and in immediately available funds, on
the dates and in the principal amounts provided in the Credit Agreement, and to
pay interest on the unpaid principal amount of the Loan, at such office, in
like money and funds, for the period commencing on the date of the Loan until
the Loan shall be paid in full, at the rates per annum and on the dates
provided in the Credit Agreement.
The date, amount and interest rate of the Loan made by the
Bank to the Borrower, and each payment made on account of the principal
thereof, shall be recorded by the Bank on its books and, prior to any transfer
of this Note, endorsed by the Bank on the schedule attached hereto or any
continuation thereof, provided that the failure of the Bank to make any such
recordation or endorsement shall not affect the obligations of the Borrower to
make a payment when due of any amount owing under the Credit Agreement or
hereunder in respect of the Loan made by the Bank.
This Note is the Note referred to in the Credit Agreement
dated as of February 26, 1997 (as modified and supplemented and in effect from
time to time, the "Credit Agreement") between the Borrower, Xxxxxxxxxx--Xxxxx
Exploration Company, Thai Xxxx Holdings, Inc., Thai Xxxx Limited and the other
Subsidiary Guarantors, and the Bank, and evidences the Loan made by the Bank
thereunder. Terms used but not defined in this Note have the respective
meanings assigned to them in the Credit Agreement.
The Credit Agreement provides for the acceleration of the
maturity of this Note upon the occurrence of certain events and for prepayments
of Loan upon the terms and conditions specified therein.
Except as permitted by Section 11.06(b) of the Credit
Agreement, this Note may not be assigned by the Bank to any other Person.
This Note shall be governed by, and construed in accordance
with, the law of the State of New York.
XXXXXXXXXX--XXXXX OIL CORPORATION
By
-------------------------
Title:
Note
68
SCHEDULE OF THE LOAN
This Note evidences the Loan made under the within-described
Credit Agreement to the Borrower, on the date, in the principal amount and
bearing interest at the rate set forth below, subject to the payments and
prepayments of principal set forth below:
Principal
Date Amount Amount Paid Unpaid Principal Notation
Made of Loan or Prepaid Amount Made by
------- --------- ----------- --------- --------
Note
