1
CONFORMED COPY
$2,100,000,000
364-DAY CREDIT AGREEMENT
dated as of
January 30, 1998
among
K N Energy, Inc.,
The Banks Listed Herein,
and
Xxxxxx Guaranty Trust Company of New York,
as Administrative Agent
------------
X. X. Xxxxxx Securities Inc.,
BancAmerica Xxxxxxxxx Xxxxxxxx,
Xxxxx Securities Inc.
and
NationsBanc Xxxxxxxxxx Securities LLC,
Syndication Agents
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TABLE OF CONTENTS
Page
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ARTICLE 1
Definitions
Section 1.01. Definitions........................................... 1
Section 1.02. Accounting Terms and Determinations................... 13
Section 1.03. Types of Borrowings................................... 13
ARTICLE 2
The Credits
Section 2.01. Commitments to Lend................................... 13
Section 2.02. Notice of Borrowing................................... 14
Section 2.03. Notice to Banks; Funding of Loans..................... 14
Section 2.04. Notes................................................. 15
Section 2.05. Maturity of Loans..................................... 16
Section 2.06. Interest Rates........................................ 16
Section 2.07. Fees.................................................. 19
Section 2.08. Optional Termination or Reduction of Commitments...... 19
Section 2.09. Scheduled Termination of Commitments.................. 20
Section 2.10. Optional Prepayments.................................. 20
Section 2.11. General Provisions as to Payments..................... 20
Section 2.12. Funding Losses........................................ 21
Section 2.13. Computation of Interest and Fees...................... 21
Section 2.14. Regulation D Compensation............................. 21
Section 2.15. Mandatary Prepayments................................. 22
ARTICLE 3
Conditions
Section 3.01. Effectiveness......................................... 23
Section 3.02. Borrowings............................................ 24
ARTICLE 4
Representations and Warranties
Section 4.01. Corporate Existence and Power......................... 25
Section 4.02. Corporate and Governmental Authorization; No
Contravention........................................ 25
Section 4.03. Binding Effect........................................ 26
Section 4.04. Financial Information................................. 26
Section 4.05. Litigation............................................ 26
Section 4.06. Compliance with ERISA................................. 26
Section 4.07. Environmental Matters................................. 27
Section 4.08. Taxes................................................. 27
Section 4.09. Subsidiaries.......................................... 28
Section 4.10. Not an Investment Company............................. 28
Section 4.11. Full Disclosure....................................... 28
Section 4.12. MidCon Acquisition.................................... 28
ARTICLE 5
Covenants
Section 5.01. Information........................................... 28
Section 5.02. Payment of Obligations................................ 31
Section 5.03. Maintenance of Property; Insurance.................... 31
Section 5.04. Conduct of Business and Maintenance of Existence...... 31
Section 5.05. Compliance with Laws.................................. 32
Section 5.06. Inspection of Property, Books and Records............. 32
Section 5.07. Debt.................................................. 32
Section 5.08. Minimum Net Worth..................................... 33
Section 5.09. Minimum Interest Coverage Ratio....................... 33
Section 5.10. Negative Pledge....................................... 33
Section 5.11. Consolidations, Mergers and Sales of Assets........... 34
Section 5.12. Use of Proceeds....................................... 35
Section 5.13. Transactions with Affiliates.......................... 35
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ARTICLE 6
Defaults
Section 6.01. Events of Default..................................... 35
Section 6.02. Notice of Default..................................... 38
ARTICLE 7
The Agents
Section 7.01. Appointment and Authorization......................... 38
Section 7.02. Administrative Agent and Affiliates................... 38
Section 7.03. Action by Administrative Agent........................ 38
Section 7.04. Consultation with Experts............................. 38
Section 7.05. Liability of Administrative Agent..................... 39
Section 7.06. Indemnification....................................... 39
Section 7.07. Credit Decision....................................... 39
Section 7.08. Successor Administrative Agent........................ 40
Section 7.09. Agents' Fees.......................................... 40
Section 7.10. Other Agents.......................................... 40
ARTICLE 8
Change in Circumstances
Section 8.01. Basis for Determining Interest Rate Inadequate or
Unfair............................................... 40
Section 8.02. Illegality............................................ 41
Section 8.03. Increased Cost and Reduced Return..................... 42
Section 8.04. Taxes................................................. 43
Section 8.05. Base Rate Loans Substituted for Affected Fixed Rate
Loans................................................ 45
Section 8.06. Substitution of Bank.................................. 45
ARTICLE 9
Miscellaneous
Section 9.01. Notices............................................... 46
Section 9.02. No Waivers............................................ 46
Section 9.03. Expenses; Indemnification............................. 46
Section 9.04. Sharing of Set-offs................................... 47
Section 9.05. Amendments and Waivers................................ 47
Section 9.06. Successors and Assigns................................ 48
Section 9.07. Collateral............................................ 49
Section 9.08. Governing Law; Submission to Jurisdiction............. 49
Section 9.09. Counterparts; Integration............................. 50
Section 9.10. WAIVER OF JURY TRIAL.................................. 50
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PRICING SCHEDULE
EXHIBIT A - NOTE
EXHIBIT B - OPINION OF SPECIAL COUNSEL FOR THE BORROWER
EXHIBIT C - OPINION OF KANSAS COUNSEL FOR THE BORROWER
EXHIBIT D - OPINION OF GENERAL COUNSEL OF THE BORROWER
EXHIBIT E - OPINION OF XXXXX XXXX & XXXXXXXX, SPECIAL COUNSEL FOR THE AGENTS
EXHIBIT F - ASSIGNMENT AND ASSUMPTION AGREEMENT
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364-DAY CREDIT AGREEMENT
AGREEMENT dated as of January 30, 1998 among K N ENERGY, INC.,
the BANKS listed on the signature pages hereof and XXXXXX GUARANTY TRUST
COMPANY OF NEW YORK, as Administrative Agent.
The parties hereto agree as follows:
ARTICLE 1
Definitions
Section 1.1. Definitions. The following terms, as used
herein, have the following meanings:
"Acquisition" means the purchase of MidCon Corp. by the
Borrower from Occidental Petroleum Corporation pursuant to the Stock Purchase
Agreement.
"Adjusted CD Rate" has the meaning set forth in Section 2.6(b).
"Administrative Agent" means Xxxxxx Guaranty Trust Company of
New York in its capacity as administrative agent for the Banks under this
Agreement, and its successors in such capacity.
"Administrative Questionnaire" means, with respect to each
Bank, an administrative questionnaire in the form prepared by the
Administrative Agent and submitted to the Administrative Agent (with a copy to
the Borrower) duly completed by such Bank.
"Affiliate" means (i) any Person that directly, or indirectly
through one or more intermediaries, controls the Borrower (a "Controlling
Person") or (ii) any Person (other than the Borrower or a Subsidiary) which is
controlled by or is under common control with a Controlling Person. As used
herein, the term "control" means possession, directly or indirectly, of the
power to direct or cause the direction of the management or policies of a
Person, whether through the ownership of voting securities, by contract or
otherwise.
"Agent" means each of the Administrative Agent and the
Syndication Agents, and "Agents" means any combination of them, as the context
may require.
"Applicable Lending Office" means, with respect to any Bank,
(i) in the case of its Domestic Loans, its Domestic Lending Office and (ii) in
the case of its Euro-Dollar Loans, its Euro-Dollar Lending Office.
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"Assessment Rate" has the meaning set forth in Section 2.6(b).
"Assignee" has the meaning set forth in Section 9.6(c).
"Bank" means each bank listed on the signature pages hereof,
each Assignee which becomes a Bank pursuant to Section 9.6(c), and their
respective successors.
"Base Rate" means, for any day, a rate per annum equal to the
higher of (i) the Prime Rate for such day or (ii) the sum of 1/2 of 1% plus the
Federal Funds Rate for such day.
"Base Rate Loan" means a Loan to be made by a Bank as a Base
Rate Loan in accordance with the applicable Notice of Borrowing or pursuant to
Article 8.
"Benefit Arrangement" means at any time an employee benefit
plan within the meaning of Section 3(3) of ERISA which is not a Plan or a
Multiemployer Plan and which is maintained or otherwise contributed to by any
member of the ERISA Group.
"Borrower" means K N Energy, Inc., a Kansas corporation, and
its successors.
"Borrower's 1996 Form 10-K" means the Borrower's annual report
on Form 10-K for 1996, as filed with the Securities and Exchange Commission
pursuant to the Securities Exchange Act of 1934.
"Borrower's Latest Form 10-Q" means the Borrower's quarterly
report on Form 10-Q for the quarter ended September 30, 1997, as filed with the
Securities and Exchange Commission pursuant to the Securities Exchange Act of
1934.
"Borrowing" has the meaning set forth in Section 1.3.
"CD Base Rate" has the meaning set forth in Section 2.6(b).
"CD Loan" means a Loan to be made by a Bank as a CD Loan in
accordance with the applicable Notice of Borrowing.
"CD Margin" has the meaning set forth in Section 2.6(b).
"CD Reference Banks" means NationsBank, N.A., The Chase
Manhattan Bank and Xxxxxx Guaranty Trust Company of New York.
"Commitment" means, with respect to each Bank, the amount set
forth opposite the name of such Bank on the signature pages of this Agreement,
as such amount may be reduced from time to time pursuant to Sections 2.8, 2.9
and 2.15.
"Consolidated Assets" means the total amount of assets
appearing on the consolidated balance sheet of the Borrower and its
Consolidated Subsidiaries, prepared in accordance with generally accepted
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accounting principles as of the date of the most recent regularly prepared
consolidated financial statements prior to the taking of any action for the
purposes of which the determination is being made.
"Consolidated Debt" of any Person means at any date the sum
(without duplication) of (i) the Debt of such Person and its Consolidated
Subsidiaries, determined on a consolidated basis as of such date plus (ii) the
excess (if any) of the Trust Preferred Securities of such Person over 10% of
the Consolidated Total Capitalization of such Person at such date minus (iii)
the portion of the Substitute Note collateralized as contemplated by Section
5.10(b) hereof.
"Consolidated EBITDA" means, for any period, Consolidated Net
Income for such period plus, to the extent deducted in determining Consolidated
Net Income for such period, the aggregate amount of (i) Consolidated Interest
Expense, (ii) income tax expense and (iii) depreciation and amortization
expense.
"Consolidated Interest Expense" means, for any period, the
interest expense of the Borrower and its Consolidated Subsidiaries, determined
on a consolidated basis for such period.
"Consolidated Subsidiary" of any Person means at any date any
Subsidiary or other entity the accounts of which would be consolidated with
those of such Person in its consolidated financial statements if such
statements were prepared as of such date.
"Consolidated Net Income" means, for any period, the net income
of the Borrower and its Consolidated Subsidiaries before extraordinary items,
determined on a consolidated basis for such period.
"Consolidated Net Worth" of any Person means at any date the
sum (without duplication) of (i) the consolidated stockholders' equity of such
Person and its Consolidated Subsidiaries, determined as of such date plus (ii)
the Mandatorily Convertible Preferred Stock of such Person plus (iii) the Trust
Preferred Securities of such Person; provided that the amount of Trust
Preferred Securities added pursuant to this clause (iii) shall not exceed 10%
of Consolidated Total Capitalization of such Person at such date.
"Consolidated Total Capitalization" of any Person means at any
date the sum of Consolidated Debt of such Person and Consolidated Net Worth of
such Person, each determined as of such date.
"Debt" of any Person means at any date, without duplication,
(i) all obligations of such Person for borrowed money, (ii) all obligations of
such Person evidenced by bonds, debentures, notes or other similar instruments,
(iii) all obligations of such Person to pay the deferred purchase price of
property or services, except trade accounts payable or deferred employee and
director compensation arising in the ordinary course of business, (iv) all
obligations of such Person as lessee which are capitalized in accordance with
generally accepted accounting principles, (v) all non-contingent obligations
(and, for purposes of Section 5.11 and the definitions of Material Debt and
Material Financial Obligations, all contingent obligations) of such Person to
reimburse any bank or other Person in respect of amounts paid under a letter
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of credit or similar instrument, (vi) all Debt secured by a Lien on any asset
of such Person, whether or not such Debt is otherwise an obligation of such
Person, and (vii) all Debt of others Guaranteed by such Person.
"Default" means any condition or event which constitutes an
Event of Default or which with the giving of notice or lapse of time or both
would, unless cured or waived, become an Event of Default.
"Derivatives Obligations" of any Person means all obligations
of such Person in respect of any rate swap transaction, basis swap, forward
rate transaction, commodity swap, commodity option, equity or equity index
swap, equity or equity index option, bond option, interest rate option, foreign
exchange transaction, cap transaction, floor transaction, collar transaction,
currency swap transaction, cross-currency rate swap transaction, currency
option or any other similar transaction (including any option with respect to
any of the foregoing transactions) or any combination of the foregoing
transactions.
"Domestic Business Day" means any day except a Saturday, Sunday
or other day on which commercial banks in New York City are authorized by law
to close.
"Domestic Lending Office" means, as to each Bank, its office
located at its address set forth in its Administrative Questionnaire (or
identified in its Administrative Questionnaire as its Domestic Lending Office)
or such other office as such Bank may hereafter designate as its Domestic
Lending Office by notice to the Borrower and the Administrative Agent; provided
that any Bank may so designate separate Domestic Lending Offices for its Base
Rate Loans, on the one hand, and its CD Loans, on the other hand, in which case
all references herein to the Domestic Lending Office of such Bank shall be
deemed to refer to either or both of such offices, as the context may require.
"Domestic Loans" means CD Loans or Base Rate Loans or both.
"Domestic Reserve Percentage" has the meaning set forth in
Section 2.6(b).
"Effective Date" means the date this Agreement becomes
effective in accordance with Section 3.1.
"Environmental Laws" means any and all federal, state, local
and foreign statutes, laws, judicial decisions, regulations, ordinances, rules,
judgments, orders, decrees, plans, injunctions, permits, concessions, grants,
franchises, licenses, agreements and other governmental restrictions relating
to the environment, the effect of the environment on human health or to
emissions, discharges or releases of pollutants, contaminants, Hazardous
Substances or wastes into the environment including, without limitation,
ambient air, surface water, ground water, or land, or otherwise relating to the
manufacture, processing, distribution, use, treatment, storage, disposal,
transport or handling of pollutants, contaminants, Hazardous Substances or
wastes or the clean-up or other remediation thereof.
"ERISA" means the Employee Retirement Income Security Act of
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1974, as amended, or any successor statute.
"ERISA Group" means the Borrower, any Subsidiary and all
members of a controlled group of corporations and all trades or businesses
(whether or not incorporated) under common control which, together with the
Borrower or any Subsidiary, are treated as a single employer under Section 414
of the Internal Revenue Code.
"Euro-Dollar Business Day" means any Domestic Business Day on
which commercial banks are open for international business (including dealings
in dollar deposits) in London.
"Euro-Dollar Lending Office" means, as to each Bank, its
office, branch or affiliate located at its address set forth in its
Administrative Questionnaire (or identified in its Administrative Questionnaire
as its Euro-Dollar Lending Office) or such other office, branch or affiliate of
such Bank as it may hereafter designate as its Euro-Dollar Lending Office by
notice to the Borrower and the Administrative Agent.
"Euro-Dollar Loan" means a Committed Loan to be made by a Bank
as a Euro-Dollar Loan in accordance with the applicable Notice of Committed
Borrowing.
"Euro-Dollar Margin" has the meaning set forth in Section
2.6(c).
"Euro-Dollar Reference Banks" means the principal London
offices (for determinations of a London Interbank Offered Rate) or domestic
offices (for determinations of an Interbank Offered Rate) of NationsBank, N.A.,
The Chase Manhattan Bank and Xxxxxx Guaranty Trust Company of New York.
"Euro-Dollar Reserve Percentage" means for any day that
percentage (expressed as a decimal) which is in effect on such day, as
prescribed by the Board of Governors of the Federal Reserve System (or any
successor) for determining the maximum reserve requirement for a member bank of
the Federal Reserve System in New York City with deposits exceeding five
billion dollars in respect of "Eurocurrency liabilities" (or in respect of any
other category of liabilities which includes deposits by reference to which the
interest rate on Euro-Dollar Loans is determined or any category of extensions
of credit or other assets which includes loans by a non-United States office of
any Bank to United States residents).
"Event of Default" has the meaning set forth in Section 6.1.
"Federal Funds Rate" means, for any day, the rate per annum
(rounded upward, if necessary, to the nearest 1/100th 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 Domestic
Business Day next succeeding such day, provided that (i) if such day is not a
Domestic Business Day, the Federal Funds Rate for such day shall be such rate
on such transactions on the next preceding Domestic Business Day as so
published on the next succeeding Domestic Business Day, and (ii) if no such
rate is so published on such next succeeding Domestic Business Day, the
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Federal Funds Rate for such day shall be the average rate quoted to Xxxxxx
Guaranty Trust Company of New York on such day on such transactions as
determined by the Administrative Agent.
"Fixed Rate Loans" means CD Loans or Euro-Dollar Loans or any
combination of the foregoing.
"Guarantee" by any Person means any obligation, contingent or
otherwise, of such Person directly or indirectly guaranteeing any Debt or other
obligation of any other Person and, without limiting the generality of the
foregoing, any obligation, direct or indirect, contingent or otherwise, of such
Person (i) to purchase or pay (or advance or supply funds for the purchase or
payment of) such Debt or other obligation (whether arising by virtue of
partnership arrangements, by agreement to keep-well, to purchase assets, goods,
securities or services, to take-or-pay, or to maintain financial statement
conditions or otherwise) or (ii) entered into for the purpose of assuring in
any other manner the obligee of such Debt or other obligation of the payment
thereof or to protect such obligee against loss in respect thereof (in whole or
in part), provided that the term Guarantee shall not include endorsements for
collection or deposit in the ordinary course of business. The term "Guarantee"
used as a verb has a corresponding meaning.
"Hazardous Substances" means any toxic, radioactive, caustic or
otherwise hazardous substance, including petroleum, its derivatives,
by-products and other hydrocarbons, or any substance having any constituent
elements displaying any of the foregoing characteristics.
"Indemnitee" has the meaning set forth in Section 9.3(b).
"Interest Coverage Ratio" means, at any date, the ratio of
Consolidated EBITDA to Consolidated Interest Expense for the period of four
consecutive fiscal quarters most recently ended on or before such date.
"Interest Period" means: (1) with respect to each Euro-Dollar
Borrowing, the period commencing on the date of such Borrowing and ending one,
two, three or six months thereafter, as the Borrower may elect in the
applicable Notice of Borrowing; except that with respect to any Borrowing
occurring prior to the Syndication Date, (i) any such Borrowing occurring prior
to February 23, 1998 shall have an Interest Period ending on February 23, 1998
and (ii) any such Borrowing on or after February 23, 1998 shall have an
Interest Period ending one week thereafter; provided that:
(a) any Interest Period which would otherwise end on a day
which is not a Euro-Dollar Business Day shall be extended to the next
succeeding Euro-Dollar Business Day unless such Euro-Dollar Business Day falls
in another calendar month, in which case such Interest Period shall end on the
next preceding Euro-Dollar Business Day;
(b) any Interest Period which begins on the last
Euro-Dollar Business Day of a calendar month (or on a day for which there is no
numerically corresponding day in the calendar month at the end of such Interest
Period) shall, subject to clause (c) below, end on the last Euro-Dollar
Business Day of a calendar month; and
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(c) any Interest Period which would otherwise end after
the Termination Date shall end on the Termination Date;
(2) with respect to each CD Borrowing, the period commencing on
the date of such Borrowing and ending 30, 60, 90 or 180 days thereafter, as the
Borrower may elect in the applicable Notice of Borrowing; provided that:
(a) any Interest Period (other than an Interest Period
determined pursuant to clause (b) below) which would otherwise end on a day
which is not a Euro-Dollar Business Day shall be extended to the next
succeeding Euro-Dollar Business Day; and
(b) any Interest Period which would otherwise end after
the Termination Date shall end on the Termination Date; and
(3) with respect to each Base Rate Borrowing, the period
commencing on the date of such Borrowing and ending 30 days thereafter;
provided that:
(a) any Interest Period (other than an Interest Period
determined pursuant to clause (b) below) which would otherwise end on a day
which is not a Euro-Dollar Business Day shall be extended to the next
succeeding Euro-Dollar Business Day; and
(b) any Interest Period which would otherwise end after
the Termination Date shall end on the Termination Date.
"Internal Revenue Code" means the Internal Revenue Code of
1986, as amended, or any successor statute.
"Investment" means any investment in any Person, whether by
means of share purchase, capital contribution, loan, time deposit or otherwise.
"Lien" means, with respect to any asset, any mortgage, lien,
pledge, charge, security interest or encumbrance of any kind, or any other type
of preferential arrangement that has the practical effect of creating a
security interest, in respect of such asset. For the purposes of this
Agreement, the Borrower or any Subsidiary shall be deemed to own subject to a
Lien any asset which it has acquired or holds subject to the interest of a
vendor or lessor under any conditional sale agreement, capital lease or other
title retention agreement relating to such asset.
"Loan" means a loan made by a Bank pursuant to Section 2.1.
"London Interbank Offered Rate" has the meaning set forth in
Section 2.6(c).
"Mandatorily Convertible Preferred Stock", means, with respect
to the Borrower, preferred securities of a Subsidiary which are (i) mandatorily
convertible into common equity securities of the Borrower within approximately
three years of their date of issuance, (ii) issued in conjunction with, and
pledged to secure, an obligation to purchase common equity securities of the
Borrower within approximately three years for an equal amount or (iii)
otherwise structured in a manner satisfactory to the Administrative Agent so
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as to ensure the issuance of incremental common equity securities of the
Borrower in a substantially equal amount within approximately three years.
"Material Debt" means Debt (other than (i) the Notes and (ii)
Debt owing to the Borrower or a Subsidiary) of the Borrower and/or one or more
of its Subsidiaries, arising in one or more related or unrelated transactions,
in an aggregate principal or face amount exceeding $75,000,000.
"Material Financial Obligations" means a principal or face
amount of Debt (other than (i) the Notes and (ii) Debt owing to the Borrower or
a Subsidiary) and/or payment obligations in respect of Derivatives Obligations
of the Borrower and/or one or more of its Subsidiaries, arising in one or more
related or unrelated transactions, exceeding in the aggregate $125,000,000.
"Material Subsidiary" means any Subsidiary the consolidated
assets of which constitute 10% or more of Consolidated Assets.
"Moody's" means Xxxxx'x Investors Service, Inc.
"Multiemployer Plan" means at any time an employee pension
benefit plan within the meaning of Section 4001(a)(3) of ERISA to which any
member of the ERISA Group is then making or accruing an obligation to make
contributions or has within the preceding five plan years made contributions,
including for these purposes any Person which ceased to be a member of the
ERISA Group during such five year period.
"Notes" means promissory notes of the Borrower, substantially
in the form of Exhibit A hereto, evidencing the obligation of the Borrower to
repay the Loans, and "Note" means any one of such promissory notes issued
hereunder.
"Notice of Borrowing" has the meaning set forth in Section
2.02.
"Parent" means, with respect to any Bank, any Person
controlling such Bank.
"Participant" has the meaning set forth in Section 9.6(b).
"PBGC" means the Pension Benefit Guaranty Corporation or any
entity succeeding to any or all of its functions under ERISA.
"Person" means an individual, a corporation, a partnership, an
association, a trust or any other entity or organization, including a
government or political subdivision or an agency or instrumentality thereof.
"Plan" means at any time an employee pension benefit plan
(other than a Multiemployer Plan) which is covered by Title IV of ERISA or
subject to the minimum funding standards under Section 412 of the Internal
Revenue Code and either (i) is maintained, or contributed to, by any member of
the ERISA Group for employees of any member of the ERISA Group or (ii) has at
any time within the preceding five years been maintained, or contributed to, by
any Person which was at such time a member of the ERISA Group for employees of
any Person which was at such time a member of the ERISA Group.
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"Purchase Agreement" means the Purchase and Sale Agreement
dated as of January 28, 1994, among K N Gas Supply Services, Inc., the
Borrower, Bank of America National Trust and Savings Association, as the
initial Purchaser (as defined therein), and Bank of America National Trust and
Savings Association, as agent for the Purchasers.
"Pricing Schedule" means the Schedule attached hereto
identified as such.
"Prime Rate" means the rate of interest publicly announced by
Xxxxxx Guaranty Trust Company of New York in New York City from time to time as
its Prime Rate.
"Reference Banks" means the CD Reference Banks or the
Euro-Dollar Reference Banks, as the context may require, and "Reference Bank"
means any one of such Reference Banks.
"Refunding Borrowing" means a Borrowing which, after
application of the proceeds thereof, results in no net increase in the
outstanding principal amount of Loans made by any Bank.
"Regulation U" means Regulation U of the Board of Governors of
the Federal Reserve System, as in effect from time to time.
"Reimbursement Agreement" means the Reimbursement Agreement
dated as of January 30, 1998, among the Borrower, the banks parties thereto and
Xxxxxx Guaranty Trust Company as the administrative agent, as amended and in
effect from time to time.
"Required Banks" means at any time Banks having at least 66 2/3
% of the aggregate amount of the Commitments or, if the Commitments shall have
been terminated, holding Notes evidencing at least 66 2/3% of the aggregate
unpaid principal amount of the Loans.
"Revolving Credit Period" means the period from and including
the Effective Date to but not including the Termination Date.
"S&P" means Standard & Poor's Ratings Services, a division of
The XxXxxx-Xxxx Companies, Inc.
"Stock Purchase Agreement" means the Stock Purchase Agreement
dated as of December 18, 1997, between Occidental Petroleum Corporation, a
Delaware corporation, and the Borrower as amended and in effect from time to
time; provided that any such amendment from the form thereof heretofore
furnished to each of the Banks which could reasonably be expected to materially
adversely affect the business, consolidated financial position or consolidated
results of operations of the Borrower and its Consolidated Subsidiaries,
considered as a whole, shall be effective for purposes of references thereto in
this Agreement only if such amendment shall have received the written consent
of the Required Banks (which shall not be unreasonably withheld).
"Subsidiary" means, as to any Person, any corporation or other
14
entity of which securities or other ownership interests having ordinary voting
power to elect a majority of the board of directors or other persons performing
similar functions are at the time directly or indirectly owned by such Person;
unless otherwise specified, "Subsidiary" means a Subsidiary of the Borrower.
"Substitute Note" means the Substitute Note (as defined in the
Stock Purchase Agreement) issued by the Borrower to Occidental Petroleum
Corporation in connection with the Acquisition.
"Syndication Agent" means either X.X. Xxxxxx Securities Inc.,
BancAmerica Xxxxxxxxx Xxxxxxxx, Xxxxx Securities Inc. or NationsBanc Xxxxxxxxxx
Securities LLC in its capacity as a syndication agent in respect of this
Agreement, and "Syndication Agents" means all of them.
"Syndication Date" means the earlier of (i) March 31, 1998 and
(ii) the first date subsequent to the date hereof on which the Commitments of
the Banks listed on the signature pages hereof shall have been reduced to an
amount less than 75% of the aggregate amount of the Commitments by reason of
the completion of primary syndication.
"Termination Date" means January 29, 1999, or, if such day is
not a Euro-Dollar Business Day, the next preceding Euro-Dollar Business Day.
"Trust Preferred Securities" means, with respect to the
Borrower, mandatorily redeemable capital trust securities of trusts which are
Subsidiaries and the subordinated debentures of the Borrower in which the
proceeds of the issuance of such capital trust securities are invested,
including, without limitation, (i) the 8.56% Series B Capital Trust
Pass-through Securities of K N Capital Trust I and (ii) the capital trust
securities of K N Capital Trust II anticipated to be issued after the Effective
Date.
"Unfunded Liabilities" means, with respect to any Plan at any
time, the amount (if any) by which (i) the value of all benefit liabilities
under such Plan, determined on a plan termination basis using the assumptions
prescribed by the PBGC for purposes of Section 4044 of ERISA, exceeds (ii) the
fair market value of all Plan assets allocable to such liabilities under Title
IV of ERISA (excluding any accrued but unpaid contributions), all determined as
of the then most recent valuation date for such Plan, but only to the extent
that such excess represents a potential liability of a member of the ERISA
Group to the PBGC or any other Person under Title IV of ERISA.
"United States" means the United States of America, including
the States and the District of Columbia, but excluding its territories and
possessions.
"Wholly-Owned Consolidated Subsidiary" of any Person means any
Consolidated Subsidiary all of the shares of capital stock or other ownership
interests of which (except directors' qualifying shares) are at the time
directly or indirectly owned by such Person.
Section 1.2. Accounting Terms and Determinations. Unless
otherwise specified herein, all accounting terms used herein shall be
interpreted, all accounting determinations hereunder shall be made, and all
15
financial statements required to be delivered hereunder shall be prepared in
accordance with generally accepted accounting principles as in effect from time
to time, applied on a basis consistent (except for changes concurred in by the
Borrower's independent public accountants) with the most recent audited
consolidated financial statements of the Borrower and its Consolidated
Subsidiaries delivered to the Banks; provided that, if the Borrower notifies
the Administrative Agent that the Borrower wishes to amend any covenant in
Article 5 to eliminate the effect of any change in generally accepted
accounting principles on the operation of such covenant (or if the
Administrative Agent notifies the Borrower that the Required Banks wish to
amend Article 5 for such purpose), then the Borrower's compliance with such
covenant shall be determined on the basis of generally accepted accounting
principles in effect immediately before the relevant change in generally
accepted accounting principles became effective, until either such notice is
withdrawn or such covenant is amended in a manner satisfactory to the Borrower
and the Required Banks.
Section 1.3. Types of Borrowings. The term "Borrowing"
denotes the aggregation of Loans of one or more Banks to be made to the
Borrower pursuant to Article 2 on a single date and for a single Interest
Period. Borrowings are classified for purposes of this Agreement by reference
to the pricing of Loans comprising such Borrowing (e.g., a "Euro-Dollar
Borrowing" is a Borrowing comprised of Euro-Dollar Loans).
ARTICLE 2
The Credits
Section 2.1. Commitments to Lend. During the Revolving Credit
Period each Bank severally agrees, on the terms and conditions set forth in
this Agreement, to make loans to the Borrower pursuant to this Section from
time to time in amounts such that the aggregate principal amount of Loans by
such Bank at any one time outstanding shall not exceed the amount of its
Commitment. Each Borrowing under this Section shall be in an aggregate
principal amount of $5,000,000 or any larger multiple of $1,000,000 (except
that any such Borrowing may be in the aggregate amount available in accordance
with Section 3.2(e)) and shall be made from the several Banks ratably in
proportion to their respective Commitments. Within the foregoing limits, the
Borrower may borrow under this Section, repay, or to the extent permitted by
Section 2.10, prepay Loans and reborrow at any time during the Revolving Credit
Period under this Section.
Section 2.2. Notice of Borrowing. The Borrower shall give the
Administrative Agent notice (a "Notice of Borrowing") not later than 10:30 A.M.
(New York City time) on (x) the date of each Base Rate Borrowing, (y) the
second Domestic Business Day before each CD Borrowing and (z) the third
Euro-Dollar Business Day before each Euro-Dollar Borrowing, except if the
Euro-Dollar Borrowing is at the Interbank Offered Rate, then upon the date of
each such borrowing, specifying:
(a) the date of such Borrowing, which shall be a Domestic Business
Day in the case of a Domestic Borrowing or a Euro-Dollar Business Day in the
case of a Euro-Dollar Borrowing,
16
(b) the aggregate amount of such Borrowing,
(c) whether the Loans comprising such Borrowing are to be CD
Loans, Base Rate Loans or Euro-Dollar Loans, and
(d) in the case of a Fixed Rate Borrowing, the duration of the
Interest Period applicable thereto, subject to the provisions of the definition
of Interest Period.
Section 2.3. Notice to Banks; Funding of Loans. (a) Upon
receipt of a Notice of Borrowing, the Administrative Agent shall promptly
notify each Bank of the contents thereof and of such Bank's share of such
Borrowing and such Notice of Borrowing shall not thereafter be revocable by the
Borrower.
(b) Not later than 12:00 Noon (New York City time) on the date of
each Borrowing, each Bank shall (except as provided in subsection (c) of this
Section) make available its share of such Borrowing, in Federal or other funds
immediately available in New York City, to the Administrative Agent at its
address referred to in Section 9.1. Unless the Administrative Agent determines
that any applicable condition specified in Article 3 has not been satisfied,
the Administrative Agent will make the funds so received from the Banks
available to the Borrower at the Administrative Agent's aforesaid address.
(c) If any Bank makes a new Loan hereunder on a day on which the
Borrower is to repay all or any part of an outstanding Loan from such Bank,
such Bank shall apply the proceeds of its new Loan to make such repayment and
only an amount equal to the difference (if any) between the amount being
borrowed and the amount being repaid shall be made available by such Bank to
the Administrative Agent as provided in subsection (b) of this Section, or
remitted by the Borrower to the Administrative Agent as provided in Section
2.11, as the case may be.
(d) Unless the Administrative Agent shall have received notice
from a Bank prior to the date of any Borrowing that such Bank will not make
available to the Administrative Agent such Bank's share of such Borrowing, the
Administrative Agent may assume that such Bank has made such share available to
the Administrative Agent on the date of such Borrowing in accordance with
subsections (b) and (c) of this Section 2.3 and the Administrative Agent may,
in reliance upon such assumption, make available to the Borrower on such date a
corresponding amount. If and to the extent that such Bank shall not have so
made such share available to the Administrative Agent, such Bank and the
Borrower severally agree to repay to the Administrative Agent forthwith on
demand such corresponding amount together with interest thereon, for each day
from the date such amount Administrative Agent, at (i) in the case of the
Borrower, a rate per annum equal to the higher of the Federal Funds Rate and
the interest rate applicable thereto pursuant to Section 2.6 and (ii) in the
case of such Bank, the Federal Funds Rate. If such Bank shall repay to the
Administrative Agent such corresponding amount, such amount so repaid shall
constitute such Bank's Loan included in such Borrowing for purposes of this
Agreement.
Section 2.4. Notes. (a) The Loans of each Bank shall be
17
evidenced by a single Note payable to the order of such Bank for the account of
its Applicable Lending Office in an amount equal to the aggregate unpaid
principal amount of such Bank's Loans.
(b) Each Bank may, by notice to the Borrower and the
Administrative Agent, request that its Loans of a particular type be evidenced
by a separate Note in an amount equal to the aggregate unpaid principal amount
of such Loans. Each such Note shall be in substantially the form of Exhibit A
hereto with appropriate modifications to reflect the fact that it evidences
solely Loans of the relevant type. Each reference in this Agreement to the
"Note" of such Bank shall be deemed to refer to and include any or all of such
Notes, as the context may require.
(c) Upon receipt of each Bank's Note pursuant to Section 3.1(b),
the Administrative Agent shall forward such Note to such Bank. Each Bank shall
record the date, amount, type and maturity of each Loan made by it and the date
and amount of each payment of principal made by the Borrower with respect
thereto, and may, if such Bank so elects in connection with any transfer or
enforcement of its Note, endorse on the schedule forming a part thereof
appropriate notations to evidence the foregoing information with respect to
each such Loan then outstanding; provided that the failure of any Bank to make
any such recordation or endorsement shall not affect the obligations of the
Borrower hereunder or under the Notes. Each Bank is hereby irrevocably
authorized by the Borrower so to endorse its Note and to attach to and make a
part of its Note a continuation of any such schedule as and when required.
Section 2.5. Maturity of Loans. Each Loan included in any
Borrowing shall mature, and the principal amount thereof shall be due and
payable, on the last day of the Interest Period applicable to such Borrowing.
Section 2.6. Interest Rates. (a) Each Base Rate Loan shall
bear interest on the outstanding principal amount thereof, for each day from
the date such Loan is made until it becomes due, at a rate per annum equal to
the Base Rate for such day. Such interest shall be payable for each Interest
Period on the last day thereof. Any overdue principal of or interest on any
Base Rate Loan shall bear interest, payable on demand, for each day until paid
at a rate per annum equal to the sum of 2% plus the rate otherwise applicable
to Base Rate Loans for such day.
(b) Each CD Loan shall bear interest on the outstanding principal
amount thereof, for each day during the Interest Period applicable thereto, at
a rate per annum equal to the sum of the CD Margin for such day plus the
Adjusted CD Rate applicable to such Interest Period; provided that if any CD
Loan shall, as a result of clause (2)(b) of the definition of Interest Period,
have an Interest Period of less than 30 days, such CD Loan shall bear interest
during such Interest Period at the rate applicable to Base Rate Loans during
such period. Such interest shall be payable for each Interest Period on the
last day thereof and, if such Interest Period is longer than 90 days, at
intervals of 90 days after the first day thereof. Any overdue principal of or
interest on any CD Loan shall bear interest, payable on demand, for each day
until paid at a rate per annum equal to the sum of 2% plus the higher of (i)
the sum of the CD Margin for such day plus the Adjusted CD Rate applicable to
the Interest Period for such Loan and (ii) the rate applicable to Base Rate
Loans for such day.
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"CD Margin" means a rate per annum determined in accordance
with the Pricing Schedule.
The "Adjusted CD Rate" applicable to any Interest Period means
a rate per annum determined pursuant to the following formula:
[ CDBR ]*
ACDR = [ ------ ] + AR
[ 1.00 - DRP ]
ACDR = Adjusted CD Rate
CDBR = CD Base Rate
DRP = Domestic Reserve Percentage
AR = Assessment Rate
__________
* The amount in brackets being rounded upward, if
necessary, to the next higher 1/100 of 1%
The "CD Base Rate" applicable to any Interest Period is the
rate of interest determined by the Administrative Agent to be the average
(rounded upward, if necessary, to the next higher 1/100 of 1%) of the
prevailing rates per annum bid at 10:00 A.M. (New York City time) (or as soon
thereafter as practicable) on the first day of such Interest Period by two or
more New York certificate of deposit dealers of recognized standing for the
purchase at face value from each CD Reference Bank of its certificates of
deposit in an amount comparable to the principal amount of the CD Loan of such
CD Reference Bank to which such Interest Period applies and having a maturity
comparable to such Interest Period.
"Domestic Reserve Percentage" means for any day that percentage
(expressed as a decimal) which is in effect on such day, as prescribed by the
Board of Governors of the Federal Reserve System (or any successor) for
determining the maximum reserve requirement (including without limitation any
basic, supplemental or emergency reserves) for a member bank of the Federal
Reserve System in New York City with deposits exceeding five billion dollars in
respect of new non-personal time deposits in dollars in New York City having a
maturity comparable to the related Interest Period and in an amount of $100,000
or more. The Adjusted CD Rate shall be adjusted automatically on and as of the
effective date of any change in the Domestic Reserve Percentage.
"Assessment Rate" means for any day the annual assessment rate
in effect on such day which is payable by a member of the Bank Insurance Fund
classified as adequately capitalized and within supervisory subgroup "A" (or a
comparable successor assessment risk classification) within the meaning of 12
C.F.R. Section 327.4(a) (or any successor provision) to the Federal Deposit
Insurance Corporation (or any successor) for such Corporation's (or such
successor's) insuring time deposits at offices of such institution in the
United States. The Adjusted CD Rate shall be adjusted automatically on and as
of the effective date of any change in the Assessment Rate.
(c) Each Euro-Dollar Loan shall bear interest on the outstanding
principal amount thereof, for each day during the Interest Period applicable
thereto, at a rate per annum equal to the sum of the Euro-Dollar Margin for
19
such day plus the London Interbank Offered Rate applicable to such Interest
Period; provided that each Euro-Dollar Loan made prior to the Syndication Date
having an Interest Period of one week shall bear interest on the outstanding
principal thereof, for each day during such Interest Period, at a rate per
annum equal to the sum of the Euro-Dollar Margin for such day plus the
Interbank Offered Rate applicable to such Interest Period. Such interest shall
be payable for each Interest Period on the last day thereof and, if such
Interest Period is longer than three months, at intervals of three months after
the first day thereof.
"Euro-Dollar Margin" means a rate per annum determined in
accordance with the Pricing Schedule.
The "London Interbank Offered Rate" applicable to any Interest
Period means the average (rounded upward, if necessary, to the next higher 1/16
of 1%) of the respective rates per annum at which deposits in dollars are
offered to each of the Euro-Dollar Reference Banks in the London interbank
market at approximately 11:00 A.M. (London time) two Euro-Dollar Business Days
before the first day of such Interest Period in an amount approximately equal
to the principal amount of the Euro-Dollar Loan of such Euro-Dollar Reference
Bank to which such Interest Period is to apply and for a period of time
comparable to such Interest Period.
The "Interbank Offered Rate" applicable to any Interest Period
means the average (rounded upward, if necessary, to the next higher 1/16 of 1%)
of the respective rates per annum at which deposits in dollars are offered to
each of the Reference Banks in the New York interbank market at approximately
12:00 Noon (New York City time) on the first day of such Interest Period in an
amount approximately equal to the principal amount of the Euro-Dollar Loan of
such Reference Bank to which such Interest Period is to apply and for a period
of time comparable to such Interest Period.
(d) Any overdue principal of or interest on any Euro-Dollar Loan
shall bear interest, payable on demand, for each day until paid at a rate per
annum equal to the higher of (i) the sum of 2% plus the Euro-Dollar Margin for
such day plus the London Interbank Offered Rate applicable to the Interest
Period for such Loan and (ii) the sum of 2% plus the Euro-Dollar Margin for
such day plus the quotient obtained (rounded upward, if necessary, to the next
higher 1/100 of 1%) by dividing (x) the average (rounded upward, if necessary,
to the next higher 1/16 of 1%) of the respective rates per annum at which one
day (or, if such amount due remains unpaid more than three Euro-Dollar Business
Days, then for such other period of time not longer than six months as the
Administrative Agent may select) deposits in dollars in an amount approximately
equal to such overdue payment due to each of the Euro-Dollar Reference Banks
are offered to such Euro-Dollar Reference Bank in the London interbank market
for the applicable period determined as provided above by (y) 1.00 minus the
Euro-Dollar Reserve Percentage (or, if the circumstances described in clause
(a) or (b) of Section 8.1 shall exist, at a rate per annum equal to the sum of
2% plus the rate applicable to Base Rate Loans for such day).
(e) The Administrative Agent shall determine each interest rate
applicable to the Loans hereunder. The Administrative Agent shall give prompt
notice to the Borrower and the Banks of each rate of interest so determined,
20
and its determination thereof shall be conclusive in the absence of manifest
error.
(f) Each Reference Bank agrees to use its best efforts to furnish
quotations to the Administrative Agent as contemplated by this Section. If any
Reference Bank does not furnish a timely quotation, the Administrative Agent
shall determine the relevant interest rate on the basis of the quotation or
quotations furnished by the remaining Reference Bank or Banks or, if none of
such quotations is available on a timely basis, the provisions of Section 8.1
shall apply.
Section 2.7. Fees. The Borrower shall pay to the
Administrative Agent for the account of the Banks ratably a facility fee at the
Facility Fee Rate (determined daily in accordance with the Pricing Schedule).
Such facility fee shall accrue (i) from and including the Effective Date to but
excluding the Termination Date (or earlier date of termination of the
Commitments in their entirety), on the daily aggregate amount of the
Commitments (whether used or unused) and (ii) from and including the
Termination Date or such earlier date of termination to but excluding the date
the Loans shall be repaid in their entirety, on the daily aggregate outstanding
principal amount of the Loans. Accrued fees under this Section shall be
payable quarterly in arrears on each March 31, June 30, September 30 and
December 31 and upon the date of termination of the Commitments in their
entirety (and, if later, the date the Loans shall be repaid in their entirety).
Section 2.8. Optional Termination or Reduction of Commitments.
During the Revolving Credit Period, the Borrower may, upon at least three
Domestic Business Days' notice to the Administrative Agent, (i) terminate the
Commitments at any time, if no Loans are outstanding at such time or (ii)
ratably reduce from time to time by an aggregate amount of $10,000,000 or any
larger multiple of $1,000,000, the aggregate amount of the Commitments in
excess of the aggregate outstanding principal amount of the Loans. Promptly
after receiving a notice pursuant to this subsection, the Administrative Agent
shall notify each Bank of the contents thereof.
Section 2.9. Scheduled Termination of Commitments. The
Commitments shall terminate on the Termination Date, and any Loans then
outstanding (together with accrued interest thereon) shall be due and payable
on such date.
Section 2.10. Optional Prepayments. (a) The Borrower may,
upon at least one Domestic Business Day's notice by 11:00 A.M. (New York City
time) to the Administrative Agent, prepay any Base Rate Borrowing in whole at
any time, or from time to time in part in amounts aggregating $5,000,000 or any
larger multiple of $1,000,000, by paying the principal amount to be prepaid
together with accrued interest thereon to the date of prepayment. Each such
optional prepayment shall be applied to prepay ratably the Base Rate Loans of
the several Banks included in such Borrowing.
(b) Subject to Section 2.12, the Borrower may, upon at least three
Domestic Business Days' notice to the Administrative Agent, prepay any CD
Borrowing or upon at least three Euro-Dollar Business Days' notice to the
Administrative Agent prepay any Euro-Dollar Borrowing, in each case in whole
21
at any time, or from time to time in part in amounts aggregating $5,000,000 or
any larger multiple of $1,000,000, by paying the principal amount to be prepaid
together with accrued interest thereon to the date of prepayment. Each such
optional prepayment shall be applied to prepay ratably the Loans of the several
Banks included in such Borrowing.
(c) Upon receipt of a notice of prepayment pursuant to this
Section, the Administrative Agent shall promptly notify each Bank of the
contents thereof and of such Bank's ratable share of such prepayment and such
notice shall not thereafter be revocable by the Borrower.
Section 2.11. General Provisions as to Payments. (a) The
Borrower shall make each payment of principal of, and interest on, the Loans
and of fees hereunder, without any set-off or counterclaim, not later than
12:00 Noon (New York City time) on the date when due, in Federal or other funds
immediately available in New York City, to the Administrative Agent at its
address referred to in Section 9.1. The Administrative Agent will promptly
distribute to each Bank its ratable share of each such payment received by the
Administrative Agent for the account of the Banks. Whenever any payment of
principal of, or interest on, the Domestic Loans or of fees shall be due on a
day which is not a Domestic Business Day, the date for payment thereof shall be
extended to the next succeeding Domestic Business Day. Whenever any payment of
principal of, or interest on, the Euro-Dollar Loans shall be due on a day which
is not a Euro-Dollar Business Day, the date for payment thereof shall be
extended to the next succeeding Euro-Dollar Business Day unless such
Euro-Dollar Business Day falls in another calendar month, in which case the
date for payment thereof shall be the next preceding Euro-Dollar Business Day.
If the date for any payment of principal is extended by operation of law or
otherwise, interest thereon shall be payable for such extended time.
(b) Unless the Administrative Agent shall have received notice
from the Borrower prior to the date on which any payment is due to the Banks
hereunder that the Borrower will not make such payment in full, the
Administrative Agent may assume that the Borrower has made such payment in full
to the Administrative Agent on such date and the Administrative Agent may, in
reliance upon such assumption, cause to be distributed to each Bank on such due
date an amount equal to the amount then due such Bank. If and to the extent
that the Borrower shall not have so made such payment, each Bank shall repay to
the Administrative Agent forthwith on demand such amount distributed to such
Bank together with interest thereon, for each day from the date such amount is
distributed to such Bank until the date such Bank repays such amount to the
Administrative Agent, at the Federal Funds Rate.
Section 2.12. Funding Losses. If the Borrower makes any
payment of principal with respect to any Fixed Rate Loan (pursuant to Article
2, 6 or 8 or otherwise) on any day other than the last day of the Interest
Period applicable thereto, or the last day of an applicable period fixed
pursuant to Section 2.6(d), or if the Borrower fails to borrow or prepay any
Fixed Rate Loans after notice has been given to any Bank in accordance with
Section 2.3(a) or 2.10(c), the Borrower shall reimburse each Bank within 15
days after demand for any resulting loss or expense incurred by it (or by an
existing or prospective Participant in the related Loan), including (without
limitation) any loss incurred in obtaining, liquidating or employing deposits
from third parties, but excluding loss of margin for the period after any such
22
payment or failure to borrow or prepay, provided that such Bank shall have
delivered to the Borrower a certificate setting forth in reasonable detail the
amount of such loss or expense, which certificate shall be conclusive in the
absence of manifest error.
Section 2.13. Computation of Interest and Fees. Interest
based on the Prime Rate hereunder shall be computed on the basis of a year of
365 days (or 366 days in a leap year) and paid for the actual number of days
elapsed (including the first day but excluding the last day). All other
interest and fees shall be computed on the basis of a year of 360 days and paid
for the actual number of days elapsed (including the first day but excluding
the last day).
Section 2.14. Regulation D Compensation. For so long as any
Bank maintains reserves against "Eurocurrency liabilities" (or any other
category of liabilities which includes deposits by reference to which the
interest rate on Euro-Dollar Loans is determined or any category of extensions
of credit or other assets which includes loans by a non-United States office of
such Bank to United States residents), and as a result the cost to such Bank
(or its Euro-Dollar Lending Office) of making or maintaining its Euro-Dollar
Loans is increased, then such Bank may require the Borrower to pay,
contemporaneously with each payment of interest on the Euro-Dollar Loans,
additional interest on the related Euro-Dollar Loan of such Bank at a rate per
annum up to but not exceeding the excess of (i) (A) the applicable London
Interbank Offered Rate divided by (B) one minus the Euro-Dollar Reserve
Percentage over (ii) the applicable London Interbank Offered Rate. Any Bank
wishing to require payment of such additional interest (x) shall so notify the
Borrower and the Administrative Agent, in which case such additional interest
on the Euro-Dollar Loans of such Bank shall be payable to such Bank at the
place indicated in such notice with respect to each Interest Period commencing
at least three Euro-Dollar Business Days after the giving of such notice and
(y) shall furnish to the Borrower at least five Euro-Dollar Business Days prior
to each date on which interest is payable on the Euro-Dollar Loans an officer's
certificate setting forth the amount to which such Bank is then entitled under
this Section (which shall be consistent with such Bank's good faith estimate of
the level at which the related reserves are maintained by it). Each such
certificate shall be accompanied by such information as the Borrower may
reasonably request as to the computation set forth therein.
Section 2.15. Mandatory Prepayments. (a) If the Borrower or
any of its Subsidiaries issues debt or equity securities prior to the
Termination Date (other than (w) equity securities issued in consideration for
the acquisition of any assets (including, without limitation, any equity
interests of any other Person), (x) equity securities issued to the Borrower or
any of its Subsidiaries, (y) directors' qualifying shares and (z) equity
securities issued in the ordinary course of business in connection with now or
hereafter existing employee stock purchase plans and other employee
compensation arrangements and dividend reinvestment plans), the Borrower shall
apply the net cash proceeds thereof until such amount has been fully applied
either (I) to the collateralization of the Substitute Note so as to cause an
equivalent reduction in the aggregate Letter of Credit Amount under and as
defined in the Reimbursement Agreement (or, if the Letter of Credit shall not
have been issued, the aggregate amount of the Commitments thereunder), until
such Letter of Credit Amount (or the aggregate amount of the Commitments) has
23
been reduced to zero; or (II) to the prepayment of outstanding Loans under this
Agreement, and simultaneously to the reduction of the aggregate Commitments
hereunder, until such Loans and Commitments have been reduced to zero, or to a
combination of (I) and (II) as the Borrower may elect. Each such reduction and
payment or prepayment shall occur within five Euro-Dollar Business Days of the
receipt by the Borrower or any of its Subsidiaries of such net cash proceeds,
provided that
(i) if such net cash proceeds are less than $10,000,000,
such prepayment shall be effective upon receipt of proceeds such that,
together with all other such amounts not previously applied, the net cash
proceeds are equal to at least $20,000,000; and
(ii) if any prepayment would otherwise require prepayment of
Fixed Rate Loans or portions thereof prior to the last day of the then
current Interest Period, then such prepayment shall, unless the
Administrative Agent otherwise notifies the Borrower upon the instructions
of the Required Banks, be deferred to the last day of such Interest
Period.
The Borrower shall give the Administrative Agent at least five Euro-Dollar
Business Days' notice of each payment or prepayment required to be made
pursuant to this subsection (a).
(b) Each reduction of Commitments and prepayment of Loans under
this Agreement shall be applied ratably to the respective Commitments and Loans
of all Banks. Each payment of principal of the Loans shall be made together
with interest accrued and unpaid on the amount repaid to the date of payment.
ARTICLE 3
Conditions
Section 3.1. Effectiveness. This Agreement shall become
effective upon receipt by the Administrative Agent of the following documents,
each dated the Effective Date unless otherwise indicated:
(a) counterparts hereof signed by each of the parties hereto (or,
in the case of any party as to which an executed counterpart shall not have
been received, receipt by the Administrative Agent in form satisfactory to it
of telegraphic, telex, facsimile or other written confirmation from such party
of execution of a counterpart hereof by such party);
(b) a duly executed Note for the account of each Bank dated on or
before the Effective Date complying with the provisions of Section 2.4;
(c) opinions of Xxxxxxx Xxxxxxx & Xxxxxxxx, special counsel for
the Borrower, Polsinelli, White, Xxxxxxxx & Shalton, Kansas counsel for the
Borrower, and Xxxxxx X. Xxxxxx, General Counsel of the Borrower, substantially
in the respective forms of Exhibits B, C and D hereto and covering such
additional matters relating to the transactions contemplated hereby as the
Required Banks may reasonably request;
24
(d) an opinion of Xxxxx Xxxx & Xxxxxxxx, special counsel for the
Administrative Agent, substantially in the form of Exhibit E hereto and
covering such additional matters relating to the transactions contemplated
hereby as the Required Banks may reasonably request; and
(e) all documents the Administrative Agent may reasonably request
relating to the existence of the Borrower, the corporate authority for and the
validity of this Agreement and the Notes, and any other matters relevant
hereto, all in form and substance satisfactory to the Administrative Agent.
The Administrative Agent shall promptly notify the Borrower and each Bank of
the effectiveness of this Agreement, and such notice shall be conclusive and
binding on all parties hereto.
Section 3.2. Borrowings. The obligation of any Bank to make a
Loan on the occasion of any Borrowing is subject to the satisfaction of the
following conditions:
(a) the fact that the Closing Date shall have occurred on or prior
to March 31, 1998;
(b) in the case of the first Borrowing, the fact that prior to or
substantially simultaneously with such Borrowing, the Borrower shall have
consummated the Acquisition in accordance with the Stock Purchase Agreement
without waiver of any material condition specified therein;
(c) in the case of the first Borrowing, the fact that the Borrower
shall have paid or shall concurrently pay all fees then due and payable to the
Administrative Agent for the account of any Agent or Bank, as previously
agreed;
(d) receipt by the Administrative Agent of a Notice of Borrowing
as required by Section 2.2;
(e) the fact that, immediately after such Borrowing, the aggregate
outstanding principal amount of the Loans will not exceed the aggregate amount
of the Commitments;
(f) the fact that, immediately before and after such Borrowing, no
Default shall have occurred and be continuing; and
(g) the fact that the representations and warranties of the
Borrower contained in this Agreement (except (i) in the case of Borrowings
subsequent to the first Borrowing, the representation and warranty set forth in
Section 4.12 and (ii) in the case of a Refunding Borrowing, the representations
and warranties set forth in Sections 4.4(c), 4.5 and 4.7 as to any matter which
has theretofore been disclosed in writing by the Borrower to the Banks) shall
be true on and as of the date of such Borrowing.
Each Borrowing hereunder shall be deemed to be a representation
and warranty by the Borrower on the date of such Borrowing as to the facts
specified in clauses (b) and (c) (in the case of the first Borrowing) and (e),
(f) and (g) of this Section.
25
ARTICLE 4
Representations and Warranties
The Borrower represents and warrants that:
Section 4.1. Corporate Existence and Power. The Borrower is a
corporation duly incorporated, validly existing and in good standing under the
laws of Kansas, and has all corporate powers and all material governmental
licenses, authorizations, consents and approvals required to carry on its
business as now conducted.
Section 4.2. Corporate and Governmental Authorization; No
Contravention. The execution, delivery and performance by the Borrower of this
Agreement and the Notes are within the Borrower's corporate powers, have been
duly authorized by all necessary corporate action, require no action by or in
respect of, or filing with, any governmental body, agency or official (other
than filings of this Agreement and the Notes with the Securities and Exchange
Commission pursuant to the reporting requirements of the Securities Exchange
Act of 1934) and do not contravene, or constitute a default under, any
provision of applicable law or regulation or of the articles of incorporation
or by-laws of the Borrower or of any agreement, judgment, injunction, order,
decree or other instrument binding upon the Borrower or any of its Subsidiaries
or result in the creation or imposition of any Lien on any asset of the
Borrower or any of its Subsidiaries.
Section 4.3. Binding Effect. This Agreement constitutes a
valid and binding agreement of the Borrower and each Note, when executed and
delivered in accordance with this Agreement, will constitute a valid and
binding obligation of the Borrower, in each case enforceable in accordance with
its terms.
Section 4.4. Financial Information. (a) The consolidated
balance sheet of the Borrower and its Consolidated Subsidiaries as of December
31, 1996 and the related consolidated statements of income, cash flows and
common stockholders' equity for the fiscal year then ended, reported on by
Xxxxxx Xxxxxxxx LLP and set forth in the Borrower's 1996 Form 10-K, a copy of
which has been delivered to each of the Banks, fairly present, in conformity
with generally accepted accounting principles, the consolidated financial
position of the Borrower and its Consolidated Subsidiaries as of such date and
their consolidated results of operations and cash flows for such fiscal year.
(b) The unaudited consolidated balance sheet of the Borrower and
its Consolidated Subsidiaries as of September 30, 1997 and the related
unaudited consolidated statements of income and cash flows for the nine months
then ended, set forth in the Borrower's Latest Form 10-Q, a copy of which has
been delivered to each of the Banks, fairly present, in conformity with
generally accepted accounting principles applied on a basis consistent with the
financial statements referred to in subsection (a) of this Section, the
consolidated financial position of the Borrower and its Consolidated
Subsidiaries as of such date and their consolidated results of operations and
cash flows for such nine-month period (subject to normal year-end adjustments).
(c) Since September 30, 1997 there has been no material adverse
26
change in the business, financial position, results of operations or prospects
of the Borrower and its Consolidated Subsidiaries, considered as a whole.
Section 4.5. Litigation. Except as disclosed in the most
recent Annual Report on Form 10-K delivered by the Borrower to the Banks, there
is no action, suit or proceeding pending against, or to the knowledge of the
Borrower threatened against or affecting, the Borrower or any of its
Subsidiaries before any court or arbitrator or any governmental body, agency or
official in which there is a reasonable possibility of an adverse decision which
would materially adversely affect the business, consolidated financial position
or consolidated results of operations of the Borrower and its Consolidated
Subsidiaries, considered as a whole, or which in any manner draws into question
the validity of this Agreement or the Notes.
Section 4.6. Compliance with ERISA. Each member of the ERISA
Group has fulfilled its obligations under the minimum funding standards of ERISA
and the Internal Revenue Code with respect to each Plan and is in compliance in
all material respects with the presently applicable provisions of ERISA and the
Internal Revenue Code with respect to each Plan. No member of the ERISA Group
has (i) sought a waiver of the minimum funding standard under Section 412 of the
Internal Revenue Code in respect of any Plan, (ii) failed to make any
contribution or payment to any Plan or Multiemployer Plan or in respect of any
Benefit Arrangement, or made any amendment to any Plan or Benefit Arrangement,
which has resulted or could result in the imposition of a Lien or the posting of
a bond or other security under ERISA or the Internal Revenue Code or (iii)
incurred any liability under Title IV of ERISA other than a liability to the
PBGC for premiums under Section 4007 of ERISA, which waiver, failure or
liability could reasonably be expected to materially adversely affect the
business, consolidated financial position or consolidated results of operations
of the Borrower and its Consolidated Subsidiaries, considered as a whole.
Section 4.7. Environmental Matters. In the ordinary course of
its business, the Borrower conducts an ongoing review of the effect of
Environmental Laws on the business, operations and properties of the Borrower
and its Subsidiaries, in the course of which it identifies and evaluates
associated liabilities and costs (including, without limitation, any capital or
operating expenditures required for clean-up or closure of properties presently
or previously owned, any capital or operating expenditures required to achieve
or maintain compliance with environmental protection standards imposed by law or
as a condition of any license, permit or contract, any related constraints on
operating activities, including any periodic or permanent shutdown of any
facility or reduction in the level of or change in the nature of operations
conducted thereat, any costs or liabilities in connection with off-site disposal
of wastes or Hazardous Substances, and any actual or potential liabilities to
third parties, including employees, and any related costs and expenses). On
the basis of this review, the Borrower has reasonably concluded that such
associated liabilities and costs, including the costs of compliance with
Environmental Laws, are unlikely to have a material adverse effect on the
business, financial condition, results of operations or prospects of the
Borrower and its Consolidated Subsidiaries, considered as a whole.
27
Section 4.8. Taxes. The Borrower and its Subsidiaries have
filed all United States Federal income tax returns and all other material tax
returns which are required to be filed by them and have paid all taxes shown to
be due on such returns or pursuant to any assessment received by the Borrower or
any Subsidiary to the extent that such taxes have become due and before they
have become delinquent, except such taxes as are being contested in good faith
by appropriate proceedings for which adequate reserves have been established in
accordance with generally accepted accounting principles.
Section 4.9. Subsidiaries. Each of the Borrower's corporate
Material Subsidiaries is a corporation duly incorporated, validly existing and
in good standing under the laws of its jurisdiction of incorporation, and has
all corporate powers and all material governmental licenses, authorizations,
consents and approvals required to carry on its business as now conducted.
Section 4.10. Not an Investment Company. The Borrower is not
an "investment company" or controlled by an "investment company" within the
meaning of the Investment Company Act of 1940, as amended.
Section 4.11. Full Disclosure. All information heretofore
furnished by the Borrower to any Agent or any Bank for purposes of or in
connection with this Agreement or any transaction contemplated hereby is, and
all such information hereafter furnished by the Borrower to any Agent or any
Bank will be, true and accurate in all material respects on the date as of
which such information is stated or certified. The Borrower has disclosed to
the Banks in writing any and all facts peculiar to the business of the Company
or any of its Subsidiaries which materially and adversely affect or may affect
(to the extent the Borrower can now reasonably foresee), the business,
operations or financial condition of the Borrower and its Consolidated
Subsidiaries, taken as a whole, or the ability of the Borrower to perform its
obligations under this Agreement.
Section 4.12. MidCon Acquisition. The representations and
warranties of all parties contained in the Stock Purchase Agreement will be
true and correct on and as of the date of the first Borrowing under this
Agreement except to the extent that the failure of the same to be true and
correct could not reasonably be expected to materially adversely affect the
business, consolidated financial position or consolidated results of operations
of the Borrower and its Consolidated Subsidiaries, considered as a whole.
ARTICLE 5
Covenants
The Borrower agrees that, so long as any Bank has any
Commitment hereunder or any amount payable under any Note remains unpaid:
Section 5.1. Information. The Borrower will deliver to each
of the Banks:
(a) as soon as available and in any event within 90 days after the
end of each fiscal year of the Borrower, a consolidated balance sheet of the
Borrower and its Consolidated Subsidiaries as of the end of such fiscal year
and the related consolidated statements of income, cash flows and common
stockholder's equity for such fiscal year, setting forth in each case in
28
comparative form the figures for the previous fiscal year, all audited by
Xxxxxx Xxxxxxxx LLP or other independent public accountants of nationally
recognized standing; provided, however, that delivery pursuant to clause (g)
below of copies of the Annual Report on Form 10-K (without exhibits) of the
Borrower for such fiscal year filed with the Securities and Exchange Commission
shall be deemed to satisfy the requirements of this clause (a);
(b) as soon as available and in any event within 45 days after the
end of each of the first three quarters of each fiscal year of the Borrower, a
consolidated balance sheet of the Borrower and its Consolidated Subsidiaries as
of the end of such quarter and the related consolidated statements of income
and cash flows for such quarter (in the case of such statements of income) and
for the portion of the Borrower's fiscal year ended at the end of such quarter,
setting forth in the case of such income and cash flows in comparative form the
figures for the corresponding quarter (in the case of such statements of
income) and the corresponding portion of the Borrower's previous fiscal year,
all certified (subject to normal year-end adjustments) as to fairness of
presentation, generally accepted accounting principles and consistency by an
authorized financial or accounting officer of the Borrower; provided, however,
that delivery pursuant to clause (g) below of copies of the Quarterly Report on
Form 10-Q (without exhibits) of the Borrower for such quarter filed with the
Securities and Exchange Commission shall be deemed to satisfy the requirements
of this clause (b);
(c) simultaneously with the delivery of each set of financial
statements referred to in clauses (a) and (b) above, a certificate of an
authorized financial or accounting officer of the Borrower (i) setting forth in
reasonable detail the calculations required to establish whether the Borrower
was in compliance with the requirements of Section 5.7 and, if applicable,
Sections 5.08 and 5.09 on the date of such financial statements and (ii)
stating whether any Default exists on the date of such certificate and, if any
Default then exists, setting forth the details thereof and the action which the
Borrower is taking or proposes to take with respect thereto;
(d) simultaneously with the delivery of each set of financial
statements referred to in clause (a) above, a statement of the firm of
independent public accountants which reported on such statements (i) whether
anything has come to their attention to cause them to believe that any Default
existed on the date of such statements and (ii) confirming the calculations set
forth in the officer's certificate delivered simultaneously therewith pursuant
to clause (c) above; provided, however, that such accountants shall not be
liable to anyone by reason of their failure to obtain knowledge of any Default
which would not be disclosed in the course of an audit conducted in accordance
with generally accepted auditing standards;
(e) within five Domestic Business Days after any officer of the
Borrower obtains knowledge of any Default, if such Default is then continuing,
a certificate of the chief financial officer or the chief accounting officer of
the Borrower setting forth the details thereof and the action which the
Borrower is taking or proposes to take with respect thereto;
(f) promptly upon the mailing thereof to the public shareholders
of the Borrower generally, copies of all financial statements, reports and
proxy statements so mailed;
29
(g) promptly upon the filing thereof, copies of all registration
statements (other than the exhibits thereto and any registration statements on
Form S-8 or its equivalent) and reports on Forms 10-K, 10-Q and 8-K (or their
equivalents, in each case without exhibits) which the Borrower shall have filed
with the Securities and Exchange Commission;
(h) if and when any member of the ERISA Group (i) gives or is
required to give notice to the PBGC of any "reportable event" (as defined in
Section 4043 of ERISA) (other than such event as to which the 30-day notice
requirement is waived or which is triggered by the Acquisition) with respect to
any Plan which might constitute grounds for a termination of such Plan under
Title IV of ERISA, or knows that the plan administrator of any Plan has given
or is required to give notice of any such reportable event, a copy of the
notice of such reportable event given or required to be given to the PBGC; (ii)
receives notice of complete or partial withdrawal liability under Title IV of
ERISA or notice that any Multiemployer Plan is in reorganization, is insolvent
or has been terminated, a copy of such notice; (iii) receives notice from the
PBGC under Title IV of ERISA of an intent to terminate, impose liability (other
than for premiums under Section 4007 of ERISA) in respect of, or appoint a
trustee to administer any Plan, a copy of such notice; (iv) applies for a
waiver of the minimum funding standard under Section 412 of the Internal
Revenue Code, a copy of such application; (v) gives notice of intent to
terminate any Plan under Section 4041(c) of ERISA, a copy of such notice and
other information filed with the PBGC; (vi) gives notice of withdrawal from any
Plan pursuant to Section 4063 of ERISA, a copy of such notice; or (vii) fails
to make any payment or contribution to any Plan or Multiemployer Plan or in
respect of any Benefit Arrangement or makes any amendment to any Plan or
Benefit Arrangement which has resulted or could result in the imposition of a
Lien or the posting of a bond or other security, a certificate of the chief
financial officer or the chief accounting officer of the Borrower setting forth
details as to such occurrence and action, if any, which the Borrower or
applicable member of the ERISA Group is required or proposes to take; and
(i) from time to time such additional information regarding the
financial position or business of the Borrower and its Subsidiaries as the
Administrative Agent, at the request of any Bank, may reasonably request.
Section 5.2. Payment of Obligations. The Borrower will pay
and discharge, and will cause each Subsidiary to pay and discharge, at or
before maturity, all their respective material obligations and liabilities,
including, without limitation, tax liabilities, except where the same may be
contested in good faith by appropriate proceedings, and will maintain, and will
cause each Subsidiary to maintain, in accordance with generally accepted
accounting principles, appropriate reserves for the accrual of any of the same.
Section 5.3. Maintenance of Property; Insurance. (a) The
Borrower will keep, and will cause each Subsidiary to keep, all property useful
and necessary in its business in good working order and condition, ordinary
wear and tear excepted.
(b) The Borrower will maintain or cause to be maintained with, in
the good faith judgment of the Borrower, financially sound and reputable
insurers, or through self-insurance, insurance with respect to its properties
30
and business and the properties and businesses of its Subsidiaries against loss
or damage of the kinds customarily insured against by corporations of
established reputation engaged in the same or similar business and similarly
situated, of such types and in such amounts as are customarily carried under
similar circumstances by such other corporations. Such insurance may include
self-insurance or be subject to co-insurance, deductibility or similar clauses
which, in effect, result in self-insurance of certain losses, provided that
such self-insurance is in accord with the approved practices of corporations
similarly situated and adequate insurance reserves are maintained in connection
with such self-insurance, and, notwithstanding the foregoing provisions of this
Section 5.3 the Borrower or any Subsidiary may effect workers' compensation or
similar insurance in respect of operations in any state or other jurisdiction
either through an insurance fund operated by such state or other jurisdiction
or by causing to be maintained a system or systems of self-insurance in accord
with applicable laws.
Section 5.4. Conduct of Business and Maintenance of Existence.
The Borrower will continue, and will cause each Material Subsidiary to
continue, to engage in business of the same general type as now conducted by
the Borrower and its Subsidiaries, and will preserve, renew and keep in full
force and effect, and will cause each Subsidiary to preserve, renew and keep in
full force and effect their respective corporate existence and their respective
rights, privileges and franchises necessary or desirable in the normal conduct
of business; provided that nothing in this Section 5.4 shall prohibit (i) the
merger of a Subsidiary into the Borrower or the merger or consolidation of a
Subsidiary with or into another Person if the corporation surviving such
consolidation or merger is a Subsidiary and if, in each case, after giving
effect thereto, no Default shall have occurred and be continuing, (ii) the sale
or other disposition (whether by merger or otherwise) of the capital stock or
assets of any Subsidiary, if such transaction complies with the provisions of
Section 5.11 or (iii) the termination of the corporate existence of any
Subsidiary if the Borrower in good faith determines that such termination is in
the best interest of the Borrower and is not materially disadvantageous to the
Banks.
Section 5.5. Compliance with Laws. The Borrower will comply,
and cause each Subsidiary to comply, in all respects with all applicable laws,
ordinances, rules, regulations, and requirements of governmental authorities
(including, without limitation, Environmental Laws and ERISA and the rules and
regulations thereunder) except (i) where the necessity of compliance therewith
is contested in good faith by appropriate proceedings or (ii) where failure to
comply could not reasonably be expected to materially adversely affect the
business, consolidated financial position or consolidated results of operations
of the Borrower and its Consolidated Subsidiaries, considered as a whole.
Section 5.6. Inspection of Property, Books and Records. The
Borrower will keep, and will cause each Subsidiary to keep, proper books of
record and account in which full, true and correct entries, as required by
generally accepted accounting principles, shall be made of all dealings and
transactions in relation to its business and activities; and will permit, and
will cause each Subsidiary to permit, representatives of any Bank at such
Bank's expense to visit and inspect any of their respective properties, to
examine and make abstracts from any of their respective books and records
31
(subject to compliance with confidentiality agreements, copyrights and the
like) and to discuss their respective affairs, finances and accounts with their
respective officers, employees and independent public accountants, all at such
reasonable times and as often as may reasonably be desired.
Section 5.7. Debt. (a) Consolidated Debt of the Borrower
will at no time exceed the MLP of Consolidated Total Capitalization. "MLP"
means Maximum Leverage Percentage, which is 87.00%, subject to adjustment from
time to time after the date hereof as follows: (a) upon the issuance of Trust
Preferred Securities in the amount of $300,000,000, the MLP will be reduced by
5.25%; (b) upon issuance of common equity securities in the amount of
$500,000,000, the MLP will be reduced by 8.75%; and (c) upon issuance of
Mandatorily Convertible Preferred Stock in the amount of $400,000,000, the MLP
will be reduced by 6.00%. In the event of issuance of securities of the type
described above in an amount different from that specified, the consequent
reduction of the MLP will be adjusted on a pro rata basis; provided that in the
event of issuance of Trust Preferred Securities in an amount greater than the
indicated amount, there will not be an additional reduction in the MLP to the
extent that the Trust Preferred Securities exceed 10% of the Consolidated Total
Capitalization of the Borrower. Upon issuance of all securities of the types
described above, the MLP will at all times thereafter be 67.00%.
(b) Total Debt of all Consolidated Subsidiaries (excluding Debt of
a Consolidated Subsidiary of the Borrower to the Borrower or to another
Consolidated Subsidiary of the Borrower) will at no time exceed 10% of
Consolidated Debt of the Borrower.
(c) Consolidated Debt of each Material Subsidiary will at no time
exceed 65% of the Consolidated Total Capitalization of such Material
Subsidiary.
Section 5.8. Minimum Net Worth. Consolidated Net Worth will
at no time be less than an amount equal to the sum of (a) $570,000,000 plus (b)
50% of Consolidated Net Income for each fiscal quarter of the Borrower ending
after the date hereof and at or prior to such time (but only if such
Consolidated Net Income for such fiscal quarter is a positive amount) plus (c)
for any issuance of securities resulting in a reduction of the MLP pursuant to
Section 5.07(a), an amount equal to 80% of the increase in Consolidated Net
Worth resulting from such issuance of securities, if at such time the
Borrower's senior unsecured long-term debt is not rated at least Baa2 by
Xxxxx'x and BBB by S&P.
Section 5.9. Minimum Interest Coverage Ratio. At any time at
which the Borrower's senior unsecured long-term debt is not rated at least Baa3
by Xxxxx'x and BBB- by S&P, the Interest Coverage Ratio will not be less than
(i) 2.25:1, if such time is prior to March 31, 1999, and (ii) 2.75:1, if such
time is on or after March 31, 1999.
Section 5.10. Negative Pledge. Neither the Borrower nor any
Subsidiary will create, assume or suffer to exist any Lien on any asset now
owned or hereafter acquired by it, except:
(a) any Liens deemed to exist on the date of this Agreement under
the Purchase Agreement;
32
(b) Liens on cash and cash equivalents securing the Substitute
Note, as contemplated by the Reimbursement Agreement;
(c) Liens on assets of any Person existing at the time such Person
becomes a Subsidiary and not created in contemplation of such event;
(d) Liens arising in the ordinary course of its business which (i)
do not secure Debt or Derivatives Obligations, (ii) do not secure any
obligation in an amount exceeding $150,000,000 and (iii) do not in the
aggregate materially detract from the value of its assets or materially impair
the use thereof in the operation of its business;
(e) Liens on cash and cash equivalents securing Derivatives
Obligations, provided that the aggregate amount of cash and cash equivalents
subject to such Liens may at no time exceed $75,000,000;
(f) statutory or common law Liens of or upon deposits of cash in
favor of banks or other depository institutions; and
(g) Liens not otherwise permitted by the foregoing clauses of this
Section securing Debt in an aggregate principal or face amount at any date not
to exceed 10% of Consolidated Net Worth of the Borrower.
Section 5.11. Consolidations, Mergers and Sales of Assets.
The Borrower will not (i) consolidate or merge with or into any other Person or
(ii) sell, lease or otherwise transfer, directly or indirectly, all or
substantially all of its assets to any other Person, unless:
(i) immediately after giving effect to the transaction, no
Default shall have occurred and be continuing; and
(ii) except in the case of a merger in which the Borrower is
the surviving corporation:
(x) the Person formed by or surviving such transaction, in
the case of a consolidation or merger, and the transferee, in
the case of a transfer, assumes all obligations of the Borrower
hereunder and under the Notes;
(y) the Person formed by or surviving such transaction, in
the case of a consolidation or merger, and the transferee, in
the case of a transfer, is organized under the laws of the
United States or any state thereof; and
(z) the Borrower has delivered to the Administrative Agent
an officer's certificate and opinion of counsel, each stating
that such consolidation, merger, or transfer and such
assumption comply with the provisions hereof.
No such sale, lease or other transfer of assets shall have the effect of
releasing the Borrower (or any successor that shall have become such in the
manner prescribed in this Section) from its liability under this Agreement and
the Notes.
33
Section 5.12. Use of Proceeds. The proceeds of the Loans made
under this Agreement will be used by the Borrower for general corporate
purposes. None of such proceeds will be used, directly or indirectly, for the
purpose, whether immediate, incidental or ultimate, of buying or carrying any
"margin stock" within the meaning of Regulation U.
Section 5.13. Transactions with Affiliates. The Borrower will
not participate in any material transaction with an affiliate (other than a
Subsidiary) unless such transaction is in the ordinary course of its business
and on terms no less advantageous to the Borrower than could be obtained in
such a transaction with an unaffiliated party.
ARTICLE 6
Defaults
Section 6.1. Events of Default. If one or more of the
following events ("Events of Default") shall have occurred and be continuing:
(a) the Borrower shall fail to pay when due any principal of any
Loan or shall fail to pay within three Domestic Business Days of the due date
thereof any interest on any Loan, any fees or any other amount payable
hereunder;
(b) the Borrower shall fail to observe or perform any covenant
contained in Sections 5.7 to 5.13, inclusive;
(c) the Borrower shall fail to observe or perform any covenant or
agreement contained in this Agreement (other than those covered by clause (a)
or (b) above) for 10 days after notice thereof has been given to the Borrower
by the Administrative Agent at the request of any Bank;
(d) any representation, warranty, certification or statement made
by the Borrower in this Agreement or in any certificate, financial statement or
other document delivered pursuant to this Agreement shall prove to have been
incorrect in any material respect when made (or deemed made);
(e) the Borrower or any Subsidiary shall fail to make any payment
in respect of any Material Financial Obligations when due or within any
applicable grace period; provided, however, that if any such failure is cured
by the Borrower or such Subsidiary or is waived by the requisite percentage of
holders of such Material Financial Obligations entitled to so waive, then the
Event of Default under this Agreement by reason of such failure shall be deemed
to have been cured;
(f) any event or condition shall occur which results in the
acceleration of the maturity of any Material Debt or enables (or, with the
giving of notice or lapse of time or both, would enable) the holder of such
Debt or any Person acting on such holder's behalf to accelerate the maturity
thereof; provided, however, that if any such acceleration is rescinded, or any
such event or condition is cured by the Borrower or any Subsidiary or is waived
by the requisite percentage of holders of such Material Debt entitled to
34
so waive, then the Event of Default under this Agreement by reason of such
acceleration, event or condition shall be deemed to have been cured;
(g) the Borrower or any Material Subsidiary shall commence a
voluntary case or other proceeding seeking liquidation, reorganization or other
relief with respect to itself or its debts under any bankruptcy, insolvency or
other similar law now or hereafter in effect or seeking the appointment of a
trustee, receiver, liquidator, custodian or other similar official of it or any
substantial part of its property, or shall consent to any such relief or to the
appointment of or taking possession by any such official in an involuntary case
or other proceeding commenced against it, or shall make a general assignment
for the benefit of creditors, or shall fail generally to pay its debts as they
become due, or shall take any corporate action to authorize any of the
foregoing;
(h) an involuntary case or other proceeding shall be commenced
against the Borrower or any Material Subsidiary seeking liquidation,
reorganization or other relief with respect to it or its debts under any
bankruptcy, insolvency or other similar law now or hereafter in effect or
seeking the appointment of a trustee, receiver, liquidator, custodian or other
similar official of it or any substantial part of its property, and such
involuntary case or other proceeding shall remain undismissed and unstayed for
a period of 60 days; or an order for relief shall be entered against the
Borrower or any Material Subsidiary under the federal bankruptcy laws as now or
hereafter in effect;
(i) any member of the ERISA Group shall fail to pay when due an
amount which it shall have become liable to pay under Title IV of ERISA; or
notice of intent to terminate a Plan shall be filed under Title IV of ERISA by
any member of the ERISA Group, any plan administrator or any combination of the
foregoing; or the PBGC shall institute proceedings under Title IV of ERISA to
terminate, to impose liability (other than for premiums under Section 4007 of
ERISA) in respect of, or to cause a trustee to be appointed to administer any
Plan; or a condition shall exist by reason of which the PBGC would be entitled
to obtain a decree adjudicating that any Plan must be terminated; or there
shall occur a complete or partial withdrawal from, or a default, within the
meaning of Section 4219(c)(5) of ERISA, with respect to, one or more
Multiemployer Plans which could cause one or more members of the ERISA Group to
incur a current payment obligation; and in each of the foregoing instances such
condition (i) could reasonably be expected to materially adversely affect the
business, consolidated financial position or consolidated results of operations
of the Borrower and its Consolidated Subsidiaries, considered as a whole, and
(ii) shall continue for 10 days after notice thereof has been given to the
Borrower by the Administrative Agent at the request of any Bank;
(j) a judgment or judgments for the payment of money (not paid or
fully covered by insurance or indemnification) in excess of $60,000,000 in the
aggregate shall be rendered against the Borrower or any Material Subsidiary and
such judgment or judgments are not, within 30 days after entry thereof, bonded,
discharged or stayed pending appeal, or are not discharged within 30 days after
the expiration of such stay; or
(k) any person or group of persons (within the meaning of Section
13 or 14 of the Securities Exchange Act of 1934, as amended) shall have
35
acquired beneficial ownership (within the meaning of Rule 13d-3 promulgated by
the Securities and Exchange Commission under said Act) of 30% or more of the
outstanding shares of common stock of the Borrower; or, during any period of
twelve consecutive calendar months, individuals who were directors of the
Borrower on the first day of such period shall cease to constitute a majority
of the board of directors of the Borrower;
then, and in every such event, the Administrative Agent shall (i) if requested
by Banks having more than 50% in aggregate amount of the Commitments, by notice
to the Borrower terminate the Commitments and they shall thereupon terminate,
and (ii) if requested by Banks holding Notes evidencing more than 50% in
aggregate principal amount of the Loans, by notice to the Borrower declare the
Notes (together with accrued interest thereon) to be, and the Notes shall
thereupon become, immediately due and payable without presentment, demand,
protest or other notice of any kind, all of which are hereby waived by the
Borrower; provided that in the case of any of the Events of Default specified
in clause (g) or (h) above with respect to the Borrower, without any notice to
the Borrower or any other act by the Administrative Agent or the Banks, the
Commitments shall thereupon terminate and the Notes (together with accrued
interest thereon) shall become immediately due and payable without presentment,
demand, protest or other notice of any kind, all of which are hereby waived by
the Borrower.
Section 6.2. Notice of Default. The Administrative Agent
shall give notice to the Borrower under Section 6.1(c) or 6.1(i) promptly upon
being requested to do so by any Bank and shall thereupon notify all the Banks
thereof.
ARTICLE 7
The Agents
Section 7.1. Appointment and Authorization. Each Bank
irrevocably appoints and authorizes the Administrative Agent to take such
action as agent on its behalf and to exercise such powers under this Agreement
and the Notes as are delegated to the Administrative Agent by the terms hereof
or thereof, together with all such powers as are reasonably incidental thereto.
Section 7.2. Administrative Agent and Affiliates. Xxxxxx
Guaranty Trust Company of New York shall have the same rights and powers under
this Agreement as any other Bank and may exercise or refrain from exercising
the same as though it were not the Administrative Agent, and Xxxxxx Guaranty
Trust Company of New York and its affiliates may accept deposits from, lend
money to, and generally engage in any kind of business with the Borrower or any
Subsidiary or affiliate of the Borrower as if it were not the Administrative
Agent hereunder.
Section 7.3. Action by Administrative Agent. The obligations
of the Administrative Agent hereunder are only those expressly set forth
herein. Without limiting the generality of the foregoing, the Administrative
Agent shall not be required to take any action with respect to any Default,
except as expressly provided in Article 6.
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Section 7.4. Consultation with Experts. The Administrative
Agent may consult with legal counsel (who may be counsel for the Borrower),
independent public accountants and other experts selected by it and shall not
be liable for any action taken or omitted to be taken by it in good faith in
accordance with the advice of such counsel, accountants or experts.
Section 7.5. Liability of Administrative Agent. Neither the
Administrative Agent nor any of its affiliates nor any of their respective
directors, officers, agents or employees shall be liable for any action taken
or not taken by it in connection herewith (i) with the consent or at the
request of the Required Banks or (ii) in the absence of its own gross
negligence or willful misconduct. Neither the Administrative Agent nor any of
its affiliates nor any of their respective directors, officers, agents or
employees shall be responsible for or have any duty to ascertain, inquire into
or verify (i) any statement, warranty or representation made in connection with
this Agreement or any borrowing hereunder; (ii) the performance or observance
of any of the covenants or agreements of the Borrower; (iii) the satisfaction
of any condition specified in Article 3, except receipt of items required to be
delivered to the Administrative Agent; or (iv) the validity, effectiveness or
genuineness of this Agreement, the Notes or any other instrument or writing
furnished in connection herewith. The Administrative Agent shall not incur any
liability by acting in reliance upon any notice, consent, certificate,
statement, or other writing (which may be a bank wire, telex, facsimile
transmission or similar writing) believed by it to be genuine or to be signed
by the proper party or parties. Without limiting the generality of the
foregoing, the use of the term "agent" in this Agreement with reference to the
Administrative Agent is not intended to connote any fiduciary or other implied
(or express) obligations arising under agency doctrine of any applicable law.
Instead, such term is used merely as a matter of market custom and is intended
to create or reflect only an administrative relationship between independent
contracting parties.
Section 7.6. Indemnification. Each Bank shall, ratably in
accordance with its Commitment, indemnify any Agent, its affiliates and their
respective directors, officers, agents and employees (to the extent not
reimbursed by the Borrower) against any cost, expense (including counsel fees
and disbursements), claim, demand, action, loss or liability (except such as
result from such indemnitees' gross negligence or willful misconduct) that such
indemnitees may suffer or incur in connection with this Agreement or any action
taken or omitted by such indemnitees hereunder.
Section 7.7. Credit Decision. Each Bank acknowledges that it
has, independently and without reliance upon any Agent or any other Bank, and
based on such documents and information as it has deemed appropriate, made its
own credit analysis and decision to enter into this Agreement. Each Bank also
acknowledges that it will, independently and without reliance upon any Agent or
any other Bank, and based on such documents and information as it shall deem
appropriate at the time, continue to make its own credit decisions in taking or
not taking any action under this Agreement.
Section 7.8. Successor Administrative Agent. The
Administrative Agent may resign at any time by giving notice thereof to the
Banks and the Borrower. Upon any such resignation, the Required Banks shall
have the right to appoint a successor Administrative Agent, with the consent
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of the Borrower, which shall not be unreasonably withheld. If no successor
Administrative Agent shall have been so appointed by the Required Banks, and
shall have accepted such appointment, within 30 days after the retiring
Administrative Agent gives notice of resignation, then the retiring
Administrative Agent may, on behalf of the Banks, appoint a successor
Administrative Agent, which shall be a commercial bank organized or licensed
under the laws of the United States of America or of any State thereof and
having a combined capital and surplus of at least $500,000,000. Upon the
acceptance of its appointment as Administrative Agent hereunder by a successor
Administrative Agent, such successor Administrative Agent shall thereupon
succeed to and become vested with all the rights and duties of the retiring
Administrative Agent, and the retiring Administrative Agent shall be discharged
from its duties and obligations hereunder. After any retiring Administrative
Agent's resignation hereunder as Administrative Agent, the provisions of this
Article shall inure to its benefit as to any actions taken or omitted to be
taken by it while it was Administrative Agent.
Section 7.9. Agents' Fees. The Borrower shall pay to the
Administrative Agent for the account of the Agents fees in the amounts and at
the times previously agreed upon between the Borrower and the Agents.
Section 7.10. Other Agents. Nothing contained in this
Agreement shall be construed to impose any obligation or duty whatsoever on any
Syndication Agent, in its capacity as such an Agent.
ARTICLE 8
Change in Circumstances
Section 8.1. Basis for Determining Interest Rate Inadequate or
Unfair. If on or prior to the first day of any Interest Period for any Fixed
Rate Borrowing:
(a) the Administrative Agent is advised by the Reference
Banks that deposits in dollars (in the applicable amounts) are
not being offered to the Reference Banks in the relevant market
for such Interest Period, or
(b) Banks having 50% or more of the aggregate amount of the
Commitments advise the Administrative Agent that the Adjusted
CD Rate or the London Interbank Offered Rate, as the case may
be, as determined by the Administrative Agent will not
adequately and fairly reflect the cost to such Banks of funding
their CD Loans or Euro-Dollar Loans, as the case may be, for
such Interest Period,
the Administrative Agent shall forthwith give notice thereof to the Borrower
and the Banks, whereupon until the Administrative Agent notifies the Borrower
that the circumstances giving rise to such suspension no longer exist, the
obligations of the Banks to make CD Loans or Euro-Dollar Loans, as the case may
be, shall be suspended. Unless the Borrower notifies the Administrative Agent
at least two Domestic Business Days before the date of any Fixed Rate Borrowing
for which a Notice of Borrowing has previously been given that it elects not to
borrow on such date, such Borrowing shall instead be made as a
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Base Rate Borrowing.
Section 8.2. Illegality. If, on or after the date of this
Agreement, the adoption of any applicable law, rule or regulation, or any
change in any applicable law, rule or regulation, or any change in the
interpretation or administration thereof by any governmental authority, central
bank or comparable agency charged with the interpretation or administration
thereof, or compliance by any Bank (or its Euro-Dollar Lending Office) with any
request or directive (whether or not having the force of law) of any such
authority, central bank or comparable agency shall make it unlawful or
impossible for any Bank (or its Euro-Dollar Lending Office) to make, maintain
or fund its Euro-Dollar Loans and such Bank shall so notify the Administrative
Agent, the Administrative Agent shall forthwith give notice thereof to the
other Banks and the Borrower, whereupon until such Bank notifies the Borrower
and the Administrative Agent that the circumstances giving rise to such
suspension no longer exist, the obligation of such Bank to make Euro-Dollar
Loans shall be suspended. Before giving any notice to the Administrative Agent
pursuant to this Section, such Bank shall designate a different Euro-Dollar
Lending Office if such designation will avoid the need for giving such notice
and will not, in the judgment of such Bank, be otherwise disadvantageous to
such Bank. If such Bank shall determine that it may not lawfully continue to
maintain and fund any of its outstanding Euro-Dollar Loans to maturity and
shall so specify in such notice, the Borrower shall immediately prepay in full
the then outstanding principal amount of each such Euro-Dollar Loan, together
with accrued interest thereon. Concurrently with prepaying each such
Euro-Dollar Loan, the Borrower shall borrow a Base Rate Loan in an equal
principal amount from such Bank (on which interest and principal shall be
payable contemporaneously with the related Euro-Dollar Loans of the other
Banks), and such Bank shall make such a Base Rate Loan.
Section 8.3. Increased Cost and Reduced Return. (a) If on or
after the date hereof, the adoption of any applicable law, rule or regulation,
or any change in any applicable law, rule or regulation, or any change in the
interpretation or administration thereof by any governmental authority, central
bank or comparable agency charged with the interpretation or administration
thereof, or compliance by any Bank (or its Applicable Lending Office) with any
request or directive (whether or not having the force of law) of any such
authority, central bank or comparable agency shall impose, modify or deem
applicable any reserve (including, without limitation, any such requirement
imposed by the Board of Governors of the Federal Reserve System, but excluding
(i) with respect to any CD Loan any such requirement included in an applicable
Domestic Reserve Percentage and (ii) with respect to any Euro-Dollar Loan any
such requirement with respect to which such Bank is entitled to compensation
during the relevant Interest Period under Section 2.15), special deposit,
insurance assessment (excluding, with respect to any CD Loan, any such
requirement reflected in an applicable Assessment Rate) or similar requirement
against assets of, deposits with or for the account of, or credit extended by,
any Bank (or its Applicable Lending Office) or shall impose on any Bank (or its
Applicable Lending Office) or on the United States market for certificates of
deposit or the London interbank market any other condition affecting its Fixed
Rate Loans, its Note or its obligation to make Fixed Rate Loans and the result
of any of the foregoing is to increase the cost to such Bank (or its Applicable
Lending Office) of making or maintaining any Fixed Rate Loan, or to
39
reduce the amount of any sum received or receivable by such Bank (or its
Applicable Lending Office) under this Agreement or under its Note with respect
thereto, by an amount deemed by such Bank to be material, then, within 15 days
after demand by such Bank (with a copy to the Administrative Agent), the
Borrower shall pay to such Bank such additional amount or amounts as will
compensate such Bank for such increased cost or reduction.
(b) If any Bank shall have determined that, after the date hereof,
the adoption of any applicable law, rule or regulation regarding capital
adequacy, or any change in any such law, rule or regulation, or any change in
the interpretation or administration thereof by any governmental authority,
central bank or comparable agency charged with the interpretation or
administration thereof, or any request or directive regarding capital adequacy
(whether or not having the force of law) of any such authority, central bank or
comparable agency (including any determination by any such authority, central
bank or comparable agency that, for purposes of capital adequacy requirements,
the Commitments hereunder do not constitute commitments with an original
maturity of one year or less), has or would have the effect of reducing the
rate of return on capital of such Bank (or its Parent) as a consequence of such
Bank's obligations hereunder to a level below that which such Bank (or its
Parent) could have achieved but for such adoption, change, request or directive
(taking into consideration its policies with respect to capital adequacy) by an
amount deemed by such Bank to be material, then from time to time, within 15
days after demand by such Bank (with a copy to the Administrative Agent), the
Borrower shall pay to such Bank such additional amount or amounts as will
compensate such Bank (or its Parent) for such reduction.
(c) Each Bank will promptly notify the Borrower and the
Administrative Agent of any event of which it has knowledge, occurring after
the date hereof, which will entitle such Bank to compensation pursuant to this
Section and will designate a different Applicable Lending Office if such
designation will avoid the need for, or reduce the amount of, such compensation
and will not, in the judgment of such Bank, be otherwise disadvantageous to
such Bank. A certificate of any Bank claiming compensation under this Section
and setting forth in reasonable detail the additional amount or amounts to be
paid to it hereunder shall be conclusive in the absence of manifest error. In
determining such amount, such Bank may use any reasonable averaging and
attribution methods. Notwithstanding the foregoing subsections (a) and (b) of
this Section 8.3, the Borrower shall only be obligated to compensate any Bank
for any amount arising or accruing during (i) any time or period commencing not
more than 90 days prior to the date on which such Bank notifies the
Administrative Agent and the Borrower that it proposes to demand such
compensation and identifies to the Administrative Agent and the Borrower the
statute, regulation or other basis upon which the claimed compensation is or
will be based and (ii) any time or period during which, because of the
retroactive application of such statute, regulation or other such basis, such
Bank did not know that such amount would arise or accrue.
Section 8.4. Taxes. (a) For purposes of this Section 8.4, the
following terms have the following meanings:
"Taxes" means any and all present or future taxes, duties,
levies, imposts, deductions, charges or withholdings with respect to any
40
payment by the Borrower pursuant to this Agreement or under any Note, and all
liabilities with respect thereto, excluding (i) in the case of each Bank and
the Administrative Agent, taxes imposed on its income, and franchise or similar
taxes imposed on it, by a jurisdiction under the laws of which such Bank or the
Administrative Agent (as the case may be) is organized or in which its
principal executive office is located or, in the case of each Bank, in which
its Applicable Lending Office is located and (ii) in the case of each Bank, any
United States withholding tax imposed on such payments but only to the extent
that such Bank is subject to United States withholding tax at the time such
Bank first becomes a party to this Agreement.
"Other Taxes" means any present or future stamp or documentary
taxes and any other excise or property taxes, or similar charges or levies,
which arise from any payment made pursuant to this Agreement or under any Note
or from the execution or delivery of, or otherwise with respect to, this
Agreement or any Note.
(b) Any and all payments by the Borrower to or for the account of
any Bank or the Administrative Agent hereunder or under any Note shall be made
without deduction for any Taxes or Other Taxes; provided that, if the Borrower
shall be required by law to deduct any Taxes or Other Taxes from any such
payments, (i) the sum payable shall be increased as necessary so that after
making all required deductions (including deductions applicable to additional
sums payable under this Section 8.4) such Bank or the Administrative Agent (as
the case may be) receives an amount equal to the sum it would have received had
no such deductions been made, (ii) the Borrower shall make such deductions,
(iii) the Borrower shall pay the full amount deducted to the relevant taxation
authority or other authority in accordance with applicable law and (iv) the
Borrower shall furnish to the Administrative Agent, at its address referred to
in Section 9.1, the original or a certified copy of a receipt evidencing
payment thereof.
(c) The Borrower agrees to indemnify each Bank and the
Administrative Agent for the full amount of Taxes or Other Taxes (including,
without limitation, any Taxes or Other Taxes imposed or asserted by any
jurisdiction on amounts payable under this Section 8.4) paid by such Bank or
the Administrative Agent (as the case may be) and any liability (including
penalties, interest and expenses) arising therefrom or with respect thereto.
This indemnification shall be paid within 15 days after such Bank or the
Administrative Agent (as the case may be) makes demand therefor.
(d) Each Bank organized under the laws of a jurisdiction outside
the United States, on or prior to the date of its execution and delivery of
this Agreement in the case of each Bank listed on the signature pages hereof
and on or prior to the date on which it becomes a Bank in the case of each
other Bank, and from time to time thereafter if requested in writing by the
Borrower (but only so long as such Bank remains lawfully able to do so), shall
provide the Borrower with Internal Revenue Service form 1001 or 4224, as
appropriate, or any successor form prescribed by the Internal Revenue Service,
certifying that such Bank is entitled to benefits under an income tax treaty to
which the United States is a party which exempts the Bank from United States
withholding tax or reduces the rate of withholding tax on payments of interest
for the account of such Bank or certifying that the income receivable pursuant
to this Agreement is effectively connected with the conduct of a trade or
41
business in the United States.
(e) For any period with respect to which a Bank has failed to
provide the Borrower with the appropriate form pursuant to Section 8.4(d)
(unless such failure is due to a change in treaty, law or regulation occurring
subsequent to the date on which such form originally was required to be
provided), such Bank shall not be entitled to indemnification under Section
8.4(b) or (c) with respect to Taxes imposed by the United States; provided that
if a Bank, which is otherwise exempt from or subject to a reduced rate of
withholding tax, becomes subject to Taxes because of its failure to deliver a
form required hereunder, the Borrower, at such Bank's expense, shall take such
steps as such Bank shall reasonably request to assist such Bank to recover such
Taxes.
(f) If the Borrower is required to pay additional amounts to or
for the account of any Bank pursuant to this Section 8.4, then such Bank will
change the jurisdiction of its Applicable Lending Office if, in the judgment of
such Bank, such change (i) will eliminate or reduce any such additional payment
which may thereafter accrue and (ii) is not otherwise disadvantageous to such
Bank.
Section 8.5. Base Rate Loans Substituted for Affected Fixed
Rate Loans. If (i) the obligation of any Bank to make Euro-Dollar Loans has
been suspended pursuant to Section 8.2 or (ii) any Bank has demanded
compensation under Section 8.3 or 8.4 with respect to its CD Loans or
Euro-Dollar Loans and the Borrower shall, by at least five Euro-Dollar Business
Days' prior notice to such Bank through the Administrative Agent, have elected
that the provisions of this Section shall apply to such Bank, then, unless and
until such Bank notifies the Borrower that the circumstances giving rise to
such suspension or demand for compensation no longer exist:
(a) all Loans which would otherwise be made by such Bank as CD
Loans or Euro-Dollar Loans, as the case may be, shall be made instead as Base
Rate Loans (on which interest and principal shall be payable contemporaneously
with the related Fixed Rate Loans of the other Banks), and
(b) after each of its CD Loans or Euro-Dollar Loans, as the case
may be, has been repaid, all payments of principal which would otherwise be
applied to repay such Fixed Rate Loans shall be applied to repay its Base Rate
Loans instead.
Section 8.6. Substitution of Bank. If (i) the obligation of
any Bank to make Euro-Dollar Loans has been suspended pursuant to Section 8.2
or (ii) any Bank has demanded compensation under Section 8.3 or 8.4, the
Borrower shall have the right, with the assistance of the Administrative Agent,
to seek a mutually satisfactory substitute bank or banks (which may be one or
more of the Banks) to purchase the Note and assume the Commitment of such Bank.
42
ARTICLE 9
Miscellaneous
Section 9.1. Notices. All notices, requests and other
communications to any party hereunder shall be in writing (including bank wire,
telex, facsimile transmission or similar writing) and shall be given to such
party: (x) in the case of the Borrower or the Administrative Agent, at its
address, facsimile number or telex number set forth on the signature pages
hereof, (y) in the case of any Bank, at its address, facsimile number or telex
number set forth in its Administrative Questionnaire or (z) in the case of any
party, such other address, facsimile number or telex number as such party may
hereafter specify for the purpose by notice to the Administrative Agent and the
Borrower. Each such notice, request or other communication shall be effective
(i) if given by telex, when such telex is transmitted to the telex number
specified in this Section and the appropriate answerback is received, (ii) if
given by facsimile transmission, when transmitted to the facsimile number
specified in this Section and confirmation of receipt is received or (iii) if
given by any other means, when delivered at the address specified in this
Section; provided that notices to the Administrative Agent under Article 2 or
Article 8 shall not be effective until received.
Section 9.2. No Waivers. No failure or delay by the
Administrative Agent or any Bank in exercising any right, power or privilege
hereunder or under any Note shall operate as a waiver thereof nor shall any
single or partial exercise thereof preclude any other or further exercise
thereof or the exercise of any other right, power or privilege. The rights and
remedies herein provided shall be cumulative and not exclusive of any rights or
remedies provided by law.
Section 9.3. Expenses; Indemnification. (a) The Borrower
shall pay (i) all reasonable out-of-pocket expenses of the Administrative
Agent, including fees and disbursements of Xxxxx Xxxx & Xxxxxxxx, special
counsel for the Agents, in connection with the preparation and administration
of this Agreement, any waiver or consent hereunder or any amendment hereof or
any Default or alleged Default hereunder and (ii) if an Event of Default
occurs, all out-of-pocket expenses incurred by each Agent and Bank, including
(without duplication) the fees and disbursements of outside counsel and the
allocated cost of inside counsel, in connection with such Event of Default and
collection, bankruptcy, insolvency and other enforcement proceedings resulting
therefrom.
(b) The Borrower agrees to indemnify each Agent and Bank, their
respective affiliates and the respective directors, officers, agents and
employees of the foregoing (each an "Indemnitee") and hold each Indemnitee
harmless from and against any and all liabilities, losses, damages, costs and
expenses of any kind, including, without limitation, the reasonable fees and
disbursements of counsel, which may be incurred by such Indemnitee in
connection with any investigative, administrative or judicial proceeding
(whether or not such Indemnitee shall be designated a party thereto) brought or
threatened relating to or arising out of (i) any actual or proposed use of
proceeds of Loans hereunder or (ii) any actual or alleged Default under this
Agreement or any actual or alleged untruth or inaccuracy of any representation
or warranty made by the Borrower in or in connection with this Agreement;
provided that no Indemnitee shall have the right to be indemnified hereunder
for such Indemnitee's own gross negligence or willful misconduct as finally
determined by a court of competent jurisdiction.
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Section 9.4. Sharing of Set-offs. Each Bank agrees that if it
shall, by exercising any right of set- off or counterclaim or otherwise,
receive payment of a proportion of the aggregate amount of principal and
interest due with respect to any Note held by it which is greater than the
proportion received by any other Bank in respect of the aggregate amount of
principal and interest due with respect to any Note held by such other Bank,
the Bank receiving such proportionately greater payment shall purchase such
participations in the Notes held by the other Banks, and such other adjustments
shall be made, as may be required so that all such payments of principal and
interest with respect to the Notes held by the Banks shall be shared by the
Banks pro rata; provided that nothing in this Section shall impair the right of
any Bank to exercise any right of set-off or counterclaim it may have and to
apply the amount subject to such exercise to the payment of indebtedness of the
Borrower other than its indebtedness hereunder. The Borrower agrees, to the
fullest extent it may effectively do so under applicable law, that any holder
of a participation in a Note, whether or not acquired pursuant to the foregoing
arrangements, may exercise rights of set-off or counterclaim and other rights
with respect to such participation as fully as if such holder of a
participation were a direct creditor of the Borrower in the amount of such
participation.
Section 9.5. Amendments and Waivers. Any provision of this
Agreement or the Notes may be amended or waived if, but only if, such amendment
or waiver is in writing and is signed by the Borrower and the Required Banks
(and, if the rights or duties of any Agent are affected thereby, by such
Agent); provided that no such amendment or waiver shall, unless signed by all
the Banks, (i) increase or decrease the Commitment of any Bank (except for a
ratable decrease in the Commitments of all Banks) or subject any Bank to any
additional obligation, (ii) reduce the principal of or rate of interest on any
Loan or any fees hereunder, (iii) postpone the date fixed for any payment of
principal of or interest on any Loan or any fees hereunder or for termination
of any Commitment or (iv) change the percentage of the Commitments or of the
aggregate unpaid principal amount of the Notes, or the number of Banks, which
shall be required for the Banks or any of them to take any action under this
Section or any other provision of this Agreement.
Section 9.6. Successors and Assigns. (a) The provisions of
this Agreement shall be binding upon and inure to the benefit of the parties
hereto and their respective successors and assigns, except that the Borrower
may not assign or otherwise transfer any of its rights under this Agreement
without the prior written consent of all Banks.
(b) Any Bank may at any time grant to one or more banks or other
institutions (each a "Participant") participating interests in its Commitment
or any or all of its Loans. In the event of any such grant by a Bank of a
participating interest to a Participant, whether or not upon notice to the
Borrower and the Administrative Agent, such Bank shall remain responsible for
the performance of its obligations hereunder, and the Borrower and the
Administrative Agent shall continue to deal solely and directly with such Bank
in connection with such Bank's rights and obligations under this Agreement.
Any agreement pursuant to which any Bank may grant such a participating
interest shall provide that such Bank shall retain the sole right and
responsibility to enforce the obligations of the Borrower hereunder including,
without limitation, the right to approve any amendment, modification or waiver
of any provision of this Agreement; provided that such participation agreement
44
may provide that such Bank will not agree to any modification, amendment or
waiver of this Agreement described in clause (i), (ii) or (iii) of Section 9.5
without the consent of the Participant. The Borrower agrees that each
Participant shall, to the extent provided in its participation agreement, be
entitled to the benefits of Article 8 with respect to its participating
interest. An assignment or other transfer which is not permitted by subsection
(c) or (d) below shall be given effect for purposes of this Agreement only to
the extent of a participating interest granted in accordance with this
subsection (b).
(c) Any Bank may at any time assign to one or more banks or other
institutions (each an "Assignee") all, or a proportionate part (equivalent to
an initial Commitment of not less than $10,000,000) of all, of its rights and
obligations under this Agreement and the Notes, and such Assignee shall assume
such rights and obligations, pursuant to an Assignment and Assumption Agreement
in substantially the form of Exhibit F hereto executed by such Assignee and
such transferor Bank, with (and subject to) the subscribed consent of the
Borrower, which shall not be unreasonably withheld, and the Administrative
Agent; provided that if an Assignee is an affiliate of such transferor Bank or
was a Bank immediately prior to such assignment, no such consent shall be
required. Upon execution and delivery of such instrument and payment by such
Assignee to such transferor Bank of an amount equal to the purchase price
agreed between such transferor Bank and such Assignee, such Assignee shall be a
Bank party to this Agreement and shall have all the rights and obligations of a
Bank with a Commitment as set forth in such instrument of assumption, and the
transferor Bank shall be released from its obligations hereunder to a
corresponding extent, and no further consent or action by any party shall be
required. Upon the consummation of any assignment pursuant to this subsection
(c), the transferor Bank, the Administrative Agent and the Borrower shall make
appropriate arrangements so that, if required, a new Note is issued to the
Assignee. In connection with any such assignment, the transferor Bank shall
pay to the Administrative Agent an administrative fee for processing such
assignment in the amount of $2,500. If the Assignee is not incorporated under
the laws of the United States of America or a state thereof, it shall deliver
to the Borrower and the Administrative Agent certification as to exemption from
deduction or withholding of any United States federal income taxes in
accordance with Section 8.4.
(d) Any Bank may at any time assign all or any portion of its
rights under this Agreement and its Note to a Federal Reserve Bank. No such
assignment shall release the transferor Bank from its obligations hereunder.
(e) No Assignee, Participant or other transferee of any Bank's
rights shall be entitled to receive any greater payment under Section 8.3 or
8.4 than such Bank would have been entitled to receive with respect to the
rights transferred, unless such transfer is made with the Borrower's prior
written consent or by reason of the provisions of Section 8.2, 8.3 or 8.4
requiring such Bank to designate a different Applicable Lending Office under
certain circumstances or at a time when the circumstances giving rise to such
greater payment did not exist.
Section 9.7. Collateral. Each of the Banks represents to each
Agent and each of the other Banks that it in good faith is not relying upon any
"margin stock" (as defined in Regulation U) as collateral in the extension or
45
maintenance of the credit provided for in this Agreement.
Section 9.8. Governing Law; Submission to Jurisdiction. This
Agreement and each Note shall be governed by and construed in accordance with
the laws of the State of New York. The Borrower hereby submits to the
nonexclusive jurisdiction of the United States District Court for the Southern
District of New York and of any New York State court sitting in New York City
having subject matter jurisdiction for purposes of all legal proceedings
arising out of or relating to this Agreement or the transactions contemplated
hereby. The Borrower irrevocably waives, to the fullest extent permitted by
law, any objection which 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.
Section 9.9. Counterparts; Integration. This Agreement may be
signed in any number of counterparts, each of which shall be an original, with
the same effect as if the signatures thereto and hereto were upon the same
instrument. This Agreement constitutes the entire agreement and understanding
among the parties hereto and supersedes any and all prior agreements and
understandings, oral or written, relating to the subject matter hereof except
the obligations of the Borrower to pay fees and expenses and to assist in the
syndication process as specified in the respective commitment letters and fee
letters heretofore entered into between the Borrower and the Agents.
Section 9.10. WAIVER OF JURY TRIAL. EACH OF THE BORROWER, THE
ADMINISTRATIVE AGENT AND THE BANKS HEREBY IRREVOCABLY WAIVES ANY AND ALL RIGHT
TO TRIAL BY JURY IN ANY LEGAL PROCEEDING ARISING OUT OF OR RELATING TO THIS
AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY.
46
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed by their respective authorized officers as of the
day and year first above written.
K N ENERGY, INC.
By /s/ Xxxxx X. XxXxxxxx
-------------------------------------
Title: Vice President & Chief
Financial Officer
000 Xxx Xxxxxx Xxxxxx
Xxxxxxxx, XX 00000-0000
Attention: Chief Financial Officer
Facsimile number: (000) 000-0000
Commitments
-----------
$699,999,999.99 XXXXXX GUARANTY TRUST COMPANY
OF NEW YORK
By /s/ Xxxx Xxxxxxxxx
-------------------------------------
Title: Vice President
47
$466,666,666.67 BANK OF AMERICA NT & SA
By /s/ J. Xxxxxxx Xxxxxxx
-------------------------------------
Title: Senior Vice President
$466,666,666.67 THE CHASE MANHATTAN BANK
By /s/ Xxxx Xx Xxxxxxxx
-------------------------------------
Title: Vice President
$466,666,666.67 NATIONSBANK, N.A.
By /s/ Xxxxx X. Xxxxxxxxx
-------------------------------------
Title: Senior Vice President
Total Commitments
$2,100,000,000
--------------
XXXXXX GUARANTY TRUST COMPANY
OF NEW YORK, as Administrative Agent
By /s/ Xxxx Xxxxxxxxx
-------------------------------------
Title: Vice President
00 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000-0000
Attention: Xxxx Xxxxxxxxx
Telex number: 177615
Facsimile number: 000-000-0000
48
PRICING SCHEDULE
The "Euro-Dollar Margin", "CD Margin" and "Facility Fee Rate"
for any day are the respective percentages set forth below in the applicable
row under the column corresponding to the Status that exists on such day:
===========================================================================
Xxxxx Xxxxx Xxxxx Xxxxx Xxxxx Xxxxx
Xxxxxx I II III IV V VI
---------------------------------------------------------------------------
Euro-Dollar Margin
Utilization < 50% 0.230% 0.320% 0.390% 0.5625% 0.750% 1.125%
Utilization > 50% 0.355% 0.445% 0.515% 0.6875% 0.875% 1.250%
-
---------------------------------------------------------------------------
CD Margin
Utilization < 50% 0.355% 0.445% 0.515% 0.6875% 0.875% 1.250%
Utilization > 50% 0.480% 0.570% 0.640% 0.8125% 1.000% 1.375%
-
---------------------------------------------------------------------------
Facility Fee Rate 0.070% 0.080% 0.110% 0.1875% 0.250% 0.375%
===========================================================================
For purposes of this Schedule, the following terms have the
following meanings:
"Level I Status" exists at any date if, at such date, the
Borrower's senior unsecured long-term debt is rated BBB+ or higher by S&P and
Baa1 or higher by Xxxxx'x.
"Level II Status" exists at any date if, at such date, (i) the
Borrower's senior unsecured long-term debt is rated BBB or higher by S&P and
Baa2 or higher by Xxxxx'x and (ii) Level I Status does not exist.
"Level III Status" exists at any date if, at such date, (i) the
Borrower's senior unsecured long-term debt is rated BBB- or higher by S&P and
Baa3 or higher by Xxxxx'x and (ii) neither Level I Status nor Level II Status
exists.
"Level IV Status" exists at any date if, at such date, (i) the
Borrower's senior unsecured long-term debt is rated BB+ or higher by S&P and
49
Ba1 or higher by Xxxxx'x and (ii) none of Level I Status, Level II Status and
Level III Status exists.
"Level V Status" exists at any date if, at such date, (i) the
Borrower's senior unsecured long-term debt is rated BB or higher by S&P and Ba2
or higher by Xxxxx'x and (ii) none of Level I Status, Level II Status, Level
III Status and Level IV Status exists.
"Level VI Status" exists at any date if, at such date, no other
Status exists.
"Status" refers to the determination of which of Level I
Status, Level II Status, Level III Status, Level IV Status, Level V Status or
Level VI Status exists at any date.
"Utilization" means, at any date, the percentage equivalent of
a fraction (i) the numerator of which is the aggregate outstanding principal
amount of the Loans at such date and (ii) the denominator of which is the
aggregate amount of the Commitments at such date. If for any reason any Loans
remain outstanding following termination of the Commitments, Utilization shall
be deemed to be in excess of 50%.
The credit ratings to be utilized for purposes of this Schedule
are those assigned to the senior unsecured long-term debt securities of the
Borrower without third-party credit enhancement, and any rating assigned to any
other debt security of the Borrower shall be disregarded. The rating in effect
at any date is that in effect at the close of business on such date.
50
EXHIBIT A
NOTE
New York, New York
, 199_
For value received, K N Energy, Inc., a Kansas corporation (the
"Borrower"), promises to pay to the order of (the "Bank"), for the account of
its Applicable Lending Office, the unpaid principal amount of each Loan made by
the Bank to the Borrower pursuant to the Credit Agreement referred to below on
the last day of the Interest Period relating to such Loan. The Borrower
promises to pay interest on the unpaid principal amount of each such Loan on
the dates and at the rate or rates provided for in the Credit Agreement. All
such payments of principal and interest shall be made in lawful money of the
United States in Federal or other immediately available funds at the office of
Xxxxxx Guaranty Trust Company of New York, 00 Xxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx.
All Loans made by the Bank, the respective types and maturities
thereof and all repayments of the principal thereof shall be recorded by the
Bank and, if the Bank so elects in connection with any transfer or enforcement
hereof, appropriate notations to evidence the foregoing information with
respect to each such Loan then outstanding may be endorsed by the Bank on the
schedule attached hereto, or on a continuation of such schedule attached to and
made a part hereof; provided that the failure of the Bank to make any such
recordation or endorsement shall not affect the obligations of the Borrower
hereunder or under the Credit Agreement.
This note is one of the Notes referred to in the 364-Day Credit
Agreement dated as of January 30, 1998 among the Borrower, the banks listed on
the signature pages thereof and Xxxxxx Guaranty Trust Company of New York, as
Administrative Agent (as the same may be amended from time to time, the "Credit
Agreement"). Terms defined in the Credit Agreement are used herein with the
same meanings. Reference is made to the Credit Agreement for provisions for
the prepayment hereof and the acceleration of the maturity hereof.
K N ENERGY, INC.
By
------------------------------------
Title:
51
Note (cont'd)
LOANS AND PAYMENTS OF PRINCIPAL
---------------------------------------------------------------------------
Amount of
Amount of Type of Principal Maturity Notation
Date Loan Loan Repaid Date Made By
---------------------------------------------------------------------------
---------------------------------------------------------------------------
---------------------------------------------------------------------------
---------------------------------------------------------------------------
---------------------------------------------------------------------------
---------------------------------------------------------------------------
---------------------------------------------------------------------------
---------------------------------------------------------------------------
---------------------------------------------------------------------------
---------------------------------------------------------------------------
---------------------------------------------------------------------------
---------------------------------------------------------------------------
---------------------------------------------------------------------------
---------------------------------------------------------------------------
52
EXHIBIT B
OPINION OF
SPECIAL COUNSEL FOR THE BORROWER
To the Banks and the Administrative Agent
Referred to Below
c/x Xxxxxx Guaranty Trust Company
of New York, as Administrative Agent
00 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Dear Sirs:
We have acted as special counsel for K N Energy, Inc. (the
"Borrower") in connection with the 364-Day Credit Agreement (the "Credit
Agreement") dated as of January 30, 1998 among the Borrower, the banks listed
on the signature pages thereof and Xxxxxx Guaranty Trust Company of New York,
as Administrative Agent. Terms defined in the Credit Agreement are used herein
as therein defined. This opinion is being rendered to you at the request of
our client pursuant to Section 3.1(c) of the Credit Agreement.
We have examined originals or copies, certified or otherwise
identified to our satisfaction, of such documents, corporate records,
certificates of public officials and other instruments and have conducted such
other investigations of fact and law as we have deemed necessary or advisable
for purposes of this opinion.
Upon the basis of the foregoing, we are of the opinion that:
1. The execution, delivery and performance by the Borrower of
the Credit Agreement and the Notes require no action by or in respect of, or
filing with, any governmental body, agency or official of the State of Texas or
the United States of America (other than filings of the Credit Agreement and
the Notes with the Securities and Exchange Commission pursuant to the reporting
requirements of the Securities and Exchange Act of 1934) and do not contravene,
or constitute a default under, any provision of applicable law or regulation of
the State of Texas or the United States of America, or of the articles of
incorporation or by-laws of the Borrower.
53
2. The Credit Agreement constitutes a valid and binding
agreement of the Borrower and each Note constitutes a valid and binding
obligation of the Borrower, in each case enforceable against the Borrower in
accordance with its terms, except as the same may be limited by bankruptcy,
insolvency or similar laws affecting creditors' rights generally and by general
principles of equity.
We are members of the Bar of the State of Texas and the
foregoing opinion is limited to the laws of the State of Texas, the State of
New York and the federal laws of the United States of America. In giving the
foregoing opinion, we express no opinion as to the effect (if any) of any law
of any jurisdiction in which any Bank is located which limits the rate of
interest that such Bank may charge or collect. Insofar as the foregoing
opinion involves matters governed by the laws of the State of Kansas (which
matters do not in our view include the non-contravention opinion in paragraph
1), we have relied, without independent investigation, upon the opinion of
Polsinelli, White, Xxxxxxxx & Xxxxxxx, delivered to you pursuant to Section
3.1(c) of the Credit Agreement.
This opinion is rendered solely to you and any Assignee or
Participant in connection with the above matter. This opinion may not be
relied upon by you or any Assignee or Participant for any other purpose or
relied upon by any other person without our prior written consent.
Very truly yours,
54
EXHIBIT C
OPINION OF
KANSAS COUNSEL FOR THE BORROWER
To the Banks and the Administrative Agent
Referred to Below
c/x Xxxxxx Guaranty Trust Company
of New York, as Administrative Agent
00 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Dear Sirs:
We have acted as counsel in the State of Kansas for K N Energy,
Inc. (the "Borrower") in connection with the 364-Day Credit Agreement (the
"Credit Agreement") dated as of January 30, 1998 among the Borrower, the banks
listed on the signature pages thereof and Xxxxxx Guaranty Trust Company of New
York, as Administrative Agent. Terms defined in the Credit Agreement are used
herein as therein defined. This opinion is being rendered to you at the
request of our client pursuant to Section 3.1(c) of the Credit Agreement.
We have examined originals or copies, certified or otherwise
identified to our satisfaction, of such documents, corporate records,
certificates of public officials and other instruments and have conducted such
other investigations of fact and law as we have deemed necessary or advisable
for purposes of this opinion.
Upon the basis of the foregoing, we are of the opinion that:
1. The Borrower is a corporation duly incorporated, validly
existing and in good standing under the laws of Kansas, and has all corporate
powers required to carry on its business as now conducted.
2. The execution, delivery and performance by the Borrower of
the Credit Agreement and the Notes are within the Borrower's corporate powers,
have been duly authorized by all necessary corporate action, require no action
by or in respect of, or filing with, any governmental body, agency or official
of the State of Kansas and do not contravene, or constitute a default under,
any provision of applicable law or regulation of the State of Kansas.
We are members of the Bar of the State of Kansas and the
foregoing opinion is limited to the laws of the State of Kansas.
This opinion is rendered solely to you and any Assignee or
Participant in connection with the above matter. This opinion may not be
relied upon by you or any Assignee or Participant for any other purpose or
relied upon by any other person without our prior written consent.
Very truly yours,
55
EXHIBIT D
OPINION OF
GENERAL COUNSEL OF THE BORROWER
To the Banks and the Administrative Agent
Referred to Below
c/x Xxxxxx Guaranty Trust Company
of New York, as Administrative Agent
00 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Dear Sirs:
I am General Counsel of K N Energy, Inc. (the "Borrower"), and
I have represented the Borrower in connection with the 364-Day Credit Agreement
(the "Credit Agreement") dated as of January 30, 1998 among the Borrower, the
banks listed on the signature pages thereof and Xxxxxx Guaranty Trust Company
of New York, as Administrative Agent. Terms defined in the Credit Agreement
are used herein as therein defined. This opinion is being rendered to you at
the request of my client pursuant to Section 3.1(c) of the Credit Agreement.
I have examined originals or copies, certified or otherwise
identified to my satisfaction, of such documents, corporate records,
certificates of public officials and other instruments and have conducted such
other investigations of fact and law as I have deemed necessary or advisable
for purposes of this opinion.
Upon the basis of the foregoing, I am of the opinion that:
1. The Borrower has all material governmental licenses,
authorizations, consents and approvals required to carry on its business as now
conducted.
2. The execution, delivery and performance by the Borrower of
the Credit Agreement and the Notes require no action by or in respect of, or
filing with, any governmental body, agency or official of the State of Colorado
or, to the best of my knowledge, any other jurisdiction (other than filings of
the Credit Agreement and the Notes with the Securities and Exchange Commission
pursuant to the reporting requirements of the Securities Exchange Act of 1934)
and do not contravene, or constitute a default under, any provision of
applicable law or regulation of the State of Colorado or, to the best of my
knowledge, any other jurisdiction or of any agreement, judgment, injunction,
order, decree or other instrument binding upon the Borrower or any of its
Subsidiaries or result in the creation or imposition of any, Lien on any asset
of the Borrower or any of its Subsidiaries.
56
3. There is no action, suit or proceeding pending against, or
to the best of my knowledge threatened against or affecting, the Borrower or
any of its Subsidiaries before any court or arbitrator or any governmental
body, agency or official, in which there is a reasonable possibility of an
adverse decision which could materially adversely affect the business,
consolidated financial position or consolidated results of operations of the
Borrower and its Consolidated Subsidiaries, considered as a whole, or which in
any manner draws into question the validity of the Credit Agreement or the
Notes.
4. Each of the Borrower's corporate Material Subsidiaries is a
corporation validly existing and in good standing under the laws of its
jurisdiction of incorporation, and has all corporate powers and all material
governmental licenses, authorizations, consents and approvals required to carry
on its business as now conducted.
I am a member of the Bar of the State of Colorado and the
foregoing opinion is limited to the laws of the State of Colorado and the
General Corporation Law of the State of Delaware. Insofar as paragraph 2 above
addresses the laws of other jurisdictions, I have relied upon my familiarity
with advice given by counsel admitted to practice in those jurisdictions, in
connection with this and other transactions.
This opinion is rendered solely to you and any Assignee or
Participant in connection with the above matter. This opinion may not be
relied upon by you or any Assignee or Participant for any other purpose or
relied upon by any other person without our prior written consent.
Very truly yours,
00
XXXXXXX X
XXXXXXX XX
XXXXX XXXX & XXXXXXXX, SPECIAL COUNSEL
FOR THE AGENTS
To the Banks and the Administrative Agent
Referred to Below
c/x Xxxxxx Guaranty Trust Company
of New York, as Administrative Agent
00 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Dear Sirs:
We have participated in the preparation of the 364-Day Credit
Agreement (the "Credit Agreement") dated as of January 30, 1998 among K N
Energy, Inc., a Kansas corporation (the "Borrower"), the banks listed on the
signature pages thereof (the "Banks") and Xxxxxx Guaranty Trust Company of New
York, as Administrative Agent (the "Administrative Agent"), and have acted as
special counsel for the Agents for the purpose of rendering this opinion
pursuant to Section 3.1(c) of the Credit Agreement. Terms defined in the
Credit Agreement are used herein as therein defined.
We have examined originals or copies, certified or otherwise
identified to our satisfaction, of such documents, corporate records,
certificates of public officials and other instruments and have conducted such
other investigations of fact and law as we have deemed necessary or advisable
for purposes of this opinion.
Upon the basis of the foregoing, we are of the opinion that the
Credit Agreement constitutes a valid and binding agreement of the Borrower and
each Note constitutes a valid and binding obligation of the Borrower, in each
case enforceable in accordance with its terms, except as the same may be
limited by bankruptcy, insolvency or similar laws affecting creditors' rights
generally and by general principles of equity.
We are members of the Bar of the State of New York and the
foregoing opinion is limited to the laws of the State of New York and the
federal laws of the United States of America. In giving the foregoing opinion,
we express no opinion as to the effect (if any) of any law of any jurisdiction
(except the State of New York) in which any Bank is located which limits the
rate of interest that such Bank may charge or collect. Insofar as the
foregoing opinion involves matters governed by the laws of Kansas, we have
relied, without independent investigation, upon the opinion of Polsinelli,
White, Xxxxxxxx & Shalton, delivered to you pursuant to Section 3.1(c) of the
Credit Agreement.
This opinion is rendered solely to you in connection with the
above matter. This opinion may not be relied upon by you for any other purpose
or relied upon by any other person without our prior written consent.
Very truly yours,
58
EXHIBIT F
ASSIGNMENT AND ASSUMPTION AGREEMENT
AGREEMENT dated as of _________, 19__ among [ASSIGNOR] (the
"Assignor"), [ASSIGNEE] (the "Assignee"),
K N ENERGY, INC. (the "Borrower") and XXXXXX GUARANTY TRUST
COMPANY OF NEW YORK, as Administrative Agent (the "Administrative Agent").
W I T N E S S E T H
WHEREAS, this Assignment and Assumption Agreement (the
"Agreement") relates to the 364-Day Credit Agreement dated as of January 30,
1998 among the Borrower, the Assignor and the other Banks party thereto, as
Banks, and the Administrative Agent (the "Credit Agreement");
WHEREAS, as provided under the Credit Agreement, the Assignor
has a Commitment to make Loans to the Borrower in an aggregate principal amount
at any time outstanding not to exceed $__________;
WHEREAS, Committed Loans made to the Borrower by the Assignor
under the Credit Agreement in the aggregate principal amount of $__________ are
outstanding at the date hereof; and
WHEREAS, the Assignor proposes to assign to the Assignee all of
the rights of the Assignor under the Credit Agreement in respect of a portion
of its Commitment thereunder in an amount equal to $__________ (the "Assigned
Amount"), together with a corresponding portion of its outstanding Committed
Loans, and the Assignee proposes to accept assignment of such rights and assume
the corresponding obligations from the Assignor on such terms;
NOW, THEREFORE, in consideration of the foregoing and the
mutual agreements contained herein, the parties hereto agree as follows:
SECTION 1. Definitions. All capitalized terms not otherwise
defined herein shall have the respective meanings set forth in the Credit
Agreement.
SECTION 2. Assignment. The Assignor hereby assigns and sells
to the Assignee all of the rights of the Assignor under the Credit Agreement to
the extent of the Assigned Amount, and the Assignee hereby accepts such
assignment from the Assignor and assumes all of the obligations of the Assignor
under the Credit Agreement to the extent of the Assigned Amount, including the
59
purchase from the Assignor of the corresponding portion of the principal amount
of the Committed Loans made by the Assignor outstanding at the date hereof.
Upon the execution and delivery hereof by the Assignor, the Assignee[, the
Borrower and the Administrative Agent] and the payment of the amounts specified
in Section 3 required to be paid on the date hereof (i) the Assignee shall, as
of the date hereof, succeed to the rights and be obligated to perform the
obligations of a Bank under the Credit Agreement with a Commitment in an amount
equal to the Assigned Amount, and (ii) the Commitment of the Assignor shall, as
of the date hereof, be reduced by a like amount and the Assignor released from
its obligations under the Credit Agreement to the extent such obligations have
been assumed by the Assignee. The assignment provided for herein shall be
without recourse to the Assignor.
SECTION 3. Payments. As consideration for the assignment and
sale contemplated in Section 2 hereof, the Assignee shall pay to the Assignor
on the date hereof in Federal funds the amount heretofore agreed between
them.(*) [It is understood that commitment and/or facility fees accrued to the
date hereof are for the account of the Assignor and such fees accruing from and
including the date hereof are for the account of the Assignee.] Each of the
Assignor and the Assignee hereby agrees that if it receives any amount under
the Credit Agreement which is for the account of the other party hereto, it
shall receive the same for the account of such other party to the extent of
such other party's interest therein and shall promptly pay the same to such
other party.
----------
*Amount should combine principal together with accrued interest and
breakage compensation, if any, to be paid by the Assignee, net of any portion
of any upfront fee to be paid by the Assignor to the Assignee. It may be
preferable in an appropriate case to specify these amounts generically or by
formula rather than as a fixed sum.
60
SECTION 4. Consent of the Borrower and the Administrative
Agent. This Agreement is conditioned upon the consent of the Borrower and the
Administrative Agent pursuant to Section 9.6(c) of the Credit Agreement. The
execution of this Agreement by the Borrower and the Administrative Agent is
evidence of this consent. Pursuant to Section 9.6(c) the Borrower agrees to
execute and deliver a Note payable to the order of the Assignee to evidence the
assignment and assumption provided for herein.
SECTION 5. Non-Reliance on Assignor. The Assignor makes no
representation or warranty in connection with, and shall have no responsibility
with respect to, the solvency, financial condition, or statements of the
Borrower, or the validity and enforceability of the obligations of the Borrower
in respect of the Credit Agreement or any Note. The Assignee acknowledges that
it has, independently and without reliance on the Assignor, and based on such
documents and information as it has deemed appropriate, made its own credit
analysis and decision to enter into this Agreement and will continue to be
responsible for making its own independent appraisal of the business, affairs
and financial condition of the Borrower.
SECTION 6. Governing Law. This Agreement shall be governed by
and construed in accordance with the laws of the State of New York.
SECTION 7. Counterparts. This Agreement may be signed in any
number of counterparts, each of which shall be an original, with the same
effect as if the signatures thereto and hereto were upon the same instrument.
61
IN WITNESS WHEREOF, the parties have caused this Agreement to
be executed and delivered by their duly authorized officers as of the date
first above written.
[ASSIGNOR]
By
-----------------------------------
Title:
[ASSIGNEE]
By
-----------------------------------
Title:
K N ENERGY, INC.
By
-----------------------------------
Title:
XXXXXX GUARANTY TRUST COMPANY
OF NEW YORK, as Administrative
Agent
By
-----------------------------------
Title:
