Exhibit 4.8
AMENDED AND RESTATED
CREDIT AGREEMENT
DATED AS OF DECEMBER 20, 1996
BY AND BETWEEN
CIRCLE C LAND CORP.
as the Borrower
AND
TEXAS COMMERCE BANK NATIONAL ASSOCIATION
as the Bank
TABLE OF CONTENTS
1. CERTAIN DEFINITIONS.......................................2
2. THE LOANS................................................ 12
2.1. Term Loan.......................................... 12
2.2. Revolving Credit Loans............................. 13
3. LETTERS OF CREDIT........................................ 15
3.1. Obligation to Issue................................ 15
3.2. Conditions......................................... 15
3.3. Issuance of Facility Letters of Credit............. 16
3.4. Reimbursement Obligations; Duties of the Bank...... 16
3.5. Payment of Reimbursement Obligations............... 17
3.6. Exoneration........................................ 17
3.7. Compensation for Facility Letters of Credit........ 18
4. INTEREST RATE PROVISIONS................................. 19
4.1. Interest Rate Determination........................ 19
4.2. Additional Interest Rate Provisions................ 20
5. PREPAYMENTS AND OTHER PAYMENTS........................... 22
5.1. Required Prepayments............................... 22
5.2. Optional Prepayments............................... 22
5.3. Prepayment of Eurodollar Rate Loans................ 22
5.4. Place of Payment or Prepayment..................... 23
5.5. No Prepayment Premium or Penalty................... 23
5.6. No Reborrowing..................................... 23
5.7. Taxes.............................................. 23
5.8. Reduction or Termination of the Revolving Loan
Commitment..................................................... 23
6. COMMITMENT FEE AND OTHER FEES............................ 23
6.1. Facility Fee....................................... 23
6.2. Commitment Fee..................................... 23
6.3. Facility Letter of Credit Fee...................... 24
6.4. Fees Not Interest; Nonpayment...................... 24
7. APPLICATION OF PROCEEDS.................................. 24
8. REPRESENTATIONS AND WARRANTIES........................... 24
8.1. Organization and Qualification..................... 24
8.2. Financial Statements............................... 24
8.3. Litigation......................................... 25
8.4. Default............................................ 25
8.5. Title to Assets.................................... 25
8.6. Payment of Taxes................................... 25
8.7. Conflicting or Adverse Agreements or
Restrictions....................................... 25
8.8. Authorization, Validity, Etc....................... 25
8.9. Investment Company Act Not Applicable.............. 25
8.10. Public Utility Holding Company Act Not
Applicable......................................... 25
8.11. Regulations G, T, U and X.......................... 26
8.12. ERISA.............................................. 26
8.13. No Financing of Corporate Takeovers................ 26
8.14. Franchises, Co-licenses, Etc....................... 26
8.15. Line of Business................................... 26
8.16. Environmental Matters.............................. 26
9. CONDITIONS............................................... 27
9.1. Representations True and No Defaults............... 27
9.2. Discharge of Debt.................................. 27
9.3. Governmental Approvals............................. 27
9.4. Compliance With Law................................ 27
9.5. Officer's Certificate and Other Documents.......... 27
9.6. Conversion/Continuation Documents.................. 27
9.7. Required Documents and Certificates................ 27
10. AFFIRMATIVE COVENANTS.................................... 28
10.1. Financial Statements and Information............... 28
10.2. Lease Schedule..................................... 29
10.3. Books and Records.................................. 29
10.4. Insurance.......................................... 29
10.5. Maintenance of Property............................ 29
10.6. Inspection of Property and Records................. 29
10.7. Existence, Laws, Obligations....................... 29
10.8. Notice of Certain Matters.......................... 29
10.9. ERISA.............................................. 30
10.10. Compliance with Environmental Laws................ 30
10.11. Settlement Statements............................. 31
10.12. Payment Calculations.............................. 31
11. NEGATIVE COVENANTS....................................... 31
11.1. Mortgages, Etc..................................... 31
11.2. Debt............................................... 32
11.3. Loans, Advances and Investments.................... 33
11.4. Merger, Consolidation, Etc......................... 33
11.5. Supply and Purchase Contracts...................... 33
11.6. Discount or Sale of Receivables.................... 34
11.7. Change in Accounting Method........................ 34
11.8. Sale of Inventory.................................. 34
11.9. Securities Credit Regulations...................... 34
11.10. Leases............................................ 34
11.11. Nature of Business; Management.................... 34
11.12. Transactions with Related Parties................. 34
11.13. Contingent Liabilities............................ 34
11.14. Hazardous Materials............................... 34
11.15. Subordinated Debt................................. 35
11.16. Phoenix Purchase Agreement........................ 35
12. EVENTS OF DEFAULT; REMEDIES.............................. 35
12.1. Failure to Pay Principal........................... 35
12.2. Failure to Pay Interest............................ 35
12.3. Failure to Pay Commitment Fee or Other Amounts..... 36
12.4. Failure to Pay Other Debt.......................... 36
12.5. Misrepresentation or Breach of Warranty............ 36
12.6. Violation of Negative Covenants.................... 36
12.7. Violation of Other Covenants, Etc.................. 36
12.8. Bankruptcy and Other Matters....................... 36
12.9. Dissolution........................................ 37
12.10. Undischarged Judgment............................. 37
12.11. Security Documents................................ 37
12.12. Failure to Maintain Guaranty...................... 37
12.13. Environmental Matters............................. 37
12.14. Other Remedies.................................... 37
12.15. Remedies Cumulative............................... 38
13. MISCELLANEOUS............................................ 38
13.1. Representation by the Bank......................... 38
13.2. Amendments, Waivers, Etc........................... 38
13.3. [intentionally omitted]............................ 38
13.4. Reimbursement of Expenses.......................... 38
13.5. Lien on Real and Personal Property................. 39
13.6. Notices............................................ 39
13.7. Governing Law...................................... 40
13.8. Survival of Representations, Warranties and
Covenants.......................................... 40
13.9. Counterparts....................................... 40
13.10. Separability...................................... 40
13.11. Descriptive Headings.............................. 41
13.12. Accounting Terms.................................. 41
13.13. Limitation of Liability........................... 41
13.14. Set-off........................................... 41
13.15. Sale or Assignment................................ 41
13.16. Interest.......................................... 41
13.17. Indemnification................................... 42
13.18. Payments Set Aside................................ 43
13.19. Loan Agreement Controls........................... 43
13.20. HLT Classification................................ 43
13.21. Capital Requirements and Yield Maintenance........ 43
13.22. FINAL AGREEMENT................................... 44
SCHEDULE 3.3 STANDBY LETTERS OF CREDIT
EXHIBIT "A" TERM NOTE
EXHIBIT "B" REVOLVING NOTE
EXHIBIT "C" NOTICE OF BORROWING
EXHIBIT "D" NOTICE OF RATE CONVERSION/CONTINUATION
EXHIBIT "E" AMENDED AND RESTATED GUARANTY AGREEMENT
EXHIBIT "F" FTX GUARANTY
AMENDED AND RESTATED
CREDIT AGREEMENT
THIS AMENDED AND RESTATED CREDIT AGREEMENT (the
"Credit Agreement" or "this Agreement") by and between CIRCLE
C LAND CORP., a corporation organized under the laws of Texas
(hereinafter called the "Borrower"), and TEXAS COMMERCE BANK
NATIONAL ASSOCIATION, a national banking association
(hereinafter called the "Bank"):
W IT X X X X X X X:
WHEREAS, the Borrower and the Bank entered into
that certain Credit Agreement, dated as of February 6, 1992
(the "Initial Agreement"); and
WHEREAS, the Initial Agreement was amended by that
certain First Amendment to Credit Agreement dated to be
effective as of June 11, 1992, executed by the Borrower and
the Bank (the "First Amendment"); and
WHEREAS, the Initial Agreement was amended by that
certain Second Amendment to Credit Agreement dated to be
effective as of November 16, 1992, executed by Borrower and
the Bank (the "Second Amendment"); and
WHEREAS, the Initial Agreement was amended by that
certain Third Amendment to Credit Agreement dated to be
effective as of May 5, 1993, executed by the Borrower and the
Bank (the "Third Amendment"); and
WHEREAS, the Initial Agreement was amended by that
certain Fourth Amendment to Credit Agreement and Revolving
Note dated to be effective as of September 1, 1993, executed
by the Borrower and the Bank (the "Fourth Amendment"); and
WHEREAS, the Initial Agreement was amended by that
certain Fifth Amendment to Credit Agreement dated to be
effective as of February 2, 1994, executed by the Borrower and
the Bank (the "Fifth Amendment"); and
WHEREAS, the Initial Agreement was amended by that
certain Sixth Amendment to Credit Agreement dated to be
effective as of July 17, 1995, executed by the Borrower and
the Bank (the "Sixth Amendment"); and
WHEREAS, the Initial Agreement was amended by that
certain Seventh Amendment to Credit Agreement dated to be
effective as of December 12, 1996, executed by the Borrower
and the Bank (the "Seventh Amendment") (the Initial Agreement
as amended by the First Amendment, Second Amendment, Third
Amendment, Fourth Amendment, Fifth Amendment, Sixth Amendment
and Seventh Amendment, the "Amended Agreement"); and
WHEREAS, the Borrower desires additional
modifications to the Amended Agreement; and
WHEREAS, the Borrower has requested that the
Amended Agreement be amended and restated as provided herein;
and
WHEREAS, the Bank has agreed to amend and restate
the Amended Agreement as provided herein;
NOW, THEREFORE, for and in consideration of Ten
and No/100 Dollars ($10.00) and other good and valuable
consideration, the receipt and sufficiency of which are hereby
acknowledged by the Borrower, the Borrower and the Bank hereby
amend and restate the Amended Agreement and agree as follows:
1. CERTAIN DEFINITIONS. Capitalized terms used
in this Agreement and not otherwise defined herein shall have
the meanings given to them as follows:
"Additional Costs" shall mean, with respect to any
Rate Period in the case of any Eurodollar Rate Loan, all
costs, losses or payments, as determined by the Bank in its
sole and absolute discretion (which determination shall be
conclusive in the absence of manifest error), that the Bank or
its Domestic Lending Office or its Eurodollar Lending Office
does, or would, if such Eurodollar Rate Loan were funded
during such Rate Period by the Domestic Lending Office or the
Eurodollar Lending Office of the Bank, incur, suffer or make
by reason of:
(a) any and all present or future taxes
(including, without limitation, any interest equalization tax
or any similar tax on the acquisition of debt obligations, or
any stamp or registration tax or duty or official or sealed
papers tax), levies, imposts or any other charge of any nature
whatsoever imposed by any taxing authority on or with regard
to any aspect of the transactions contemplated by this
Agreement, except such taxes as may be measured by the overall
net income of the Bank or its Domestic Lending Office or its
Eurodollar Lending Office and imposed by the jurisdiction, or
any political subdivision or taxing authority thereof, in
which the Bank's Domestic Lending Office or its Eurodollar
Lending Office is located; and
(b) any increase in the cost to the Bank of
agreeing to make or making, funding or maintaining any
Eurodollar Rate Loan because of or arising from (i) the
introduction of, or any change (other than any change by way
of imposition or increase of reserve requirements, in the case
of any Eurodollar Rate Loan, included in the Eurodollar Rate
Reserve Percentage) in or in the interpretation or
administration of, any law or regulation or (ii) the
compliance with any request from any central bank or other
governmental authority (whether or not having the force of
law).
"Adjusted Excess Cash Flow" means Excess Cash Flow
calculated for each Quarter-Annual Period, minus any interest
payments, payments of regularly scheduled principal
installments and payments required under Subsection 5.1(d) of
the Credit Agreement.
"Affiliate" shall mean any Person controlling,
controlled by or under common control with any other Person.
For purposes of this definition, "control" (including
"controlled by" and "under common control with") means the
possession, directly or indirectly, of the power to direct or
cause the direction of the management and policies of such
Person, whether through the ownership of voting securities or
otherwise. If any Person shall own, directly or indirectly,
beneficially and of record twenty percent (20%) or more of the
equity (whether outstanding capital stock, partnership
interests or otherwise) of another Person, such Person shall
be deemed to be an Affiliate.
"Agreement" shall mean this Credit Agreement, as
the same may be amended, modified or supplemented from time to
time.
"Applicable Lending Office" shall mean the Bank's
(a) Domestic Lending Office in the case of a Base Rate Loan
and (b) Eurodollar Lending Office in the case of a Eurodollar
Rate Loan.
"Base Rate" shall mean, for any day, a rate per
annum (rounded upward to the nearest 1/16 of 1%) equal to the
greater of (a) the Prime Rate (computed on the basis of the
actual number of days elapsed over a year of 365 or 366 days,
as the case may be) and (b) the Federal Funds Rate in effect
for such day plus one-half of one percent (1/2%). For purposes
of this Agreement, any change in the Base Rate due to a change
in the Federal Funds Rate shall be effective on the effective
date of such change in the Federal Funds Rate. If for any
reason the Bank shall have determined (which determination
shall be conclusive and binding, absent manifest error) that
it is unable to ascertain the Federal Funds Rate for any
reason, including, without limitation, the inability or
failure of the Bank to obtain sufficient bids or publications
in accordance with the terms thereof, the Base Rate shall be
the Prime Rate until the circumstances giving rise to such
inability no longer exist.
"Base Rate Loan" shall mean any Loan which bears
interest at the Base Rate.
"Xxxx of Sale" shall mean the Xxxx of Sale,
Assignment and Assumption Agreement, dated June 11, 1992,
executed by FREEPORT-McMoRan INC., a Delaware corporation, and
FM Properties.
"Borrowing Date" shall mean a date upon which the
Borrower has requested a Loan is to be made in a Notice of
Borrowing delivered pursuant to Section .
"Borrower's Cash Reserve" shall mean on the last
day of each Quarter-Annual Period during the term of the
Loans, the amount in cash necessary to bring the total cash
reserves held by Borrower to equal the amount of $300,000.
"Budget" shall mean the budget described in
Section .
"Business Day" shall mean a day when the Bank is
open for business, provided that, if the applicable Business
Day relates to any Eurodollar Rate Loan, it shall mean a day
when the Bank is open for business and banks are open for
business in the Eurodollar interbank market selected by the
Bank in determining the Eurodollar Rate and in New York City.
"Circle C Tract" shall mean the real property and
the personal property relating to it as described in Section .
"Closing Date" shall mean February 6, 1992.
"Code" shall mean the Internal Revenue Code of
1986, as amended, as now or hereafter in effect, together with
all regulations, rulings and interpretations thereof or
thereunder issued by the Internal Revenue Service.
"Commitment" shall mean the Revolving Loan
Commitment, the Term Loan Commitment, and the Letter of Credit
Commitment.
"Conversion/Continuation Date" shall have the
meaning set forth in Section (a)(ii).
"Current Debt" shall mean any obligation for
borrowed money (and any notes payable and drafts accepted
representing extensions of credit whether or not representing
obligations for borrowed money) payable on demand or within a
period of one year from the date of the creation thereof;
provided that (i) any obligation, except Debt represented by
the Notes, shall be treated as Funded Debt, regardless of its
term, if such obligation is renewable, pursuant to the terms
thereof or of a revolving credit or similar agreement, to a
date more than one year after the date of the creation of such
obligation and (ii) all Debt represented by the Notes shall be
treated as Current Debt.
"Debt" shall mean Funded Debt or Current Debt, as
the case may be, including the Borrower's indebtedness
represented by the Notes.
"Debtor Laws" shall mean all applicable
liquidation, conservatorship, bankruptcy, moratorium,
arrangement, receivership, insolvency, reorganization, or
similar laws, or general equitable principles from time to
time in effect affecting the rights of creditors generally.
"Default" shall mean any of the events specified
in Section , whether or not there has been satisfied any
requirement in connection with such event for the giving of
notice, or the lapse of time, or the happening of any further
condition, event or act.
"Dollars" and "$" shall mean lawful currency of
the United States of America.
"Domestic Lending Office" shall mean the Bank's
office located at 000 Xxxxxx, Xxxxxxx, Xxxxx 00000 or such
other office of the Bank as the Bank may from time to time
specify to the Borrower.
"Environmental Law" shall mean (a) the
Comprehensive Environmental Response, Compensation and
Liability Act of 1980 (as amended by the Superfund Amendments
and Reauthorization Act of 1986, 42 U.S.C.A. 9601 et seq.),
as amended from time to time, and any and all rules and
regulations issued or promulgated thereunder ("CERCLA");
(b) the Resource Conservation and Recovery Act (as amended by
the Hazardous and Solid Waste Amendment of 1984, 42 U.S.C.A.
6901 et seq.), as amended from time to time, and any and all
rules and regulations issued or promulgated thereunder
("RCRA"); (c) the Clean Air Act, 42 U.S.C.A. 7401 et seq.,
as amended from time to time, and any and all rules and
regulations issued or promulgated thereunder; (d) the Clean
Water Act of 1977, 33 U.S.C.A. 1251 et seq., as amended from
time to time, and any and all rules and regulations issued or
promulgated thereunder; (e) the Toxic Substances Control Act,
15 U.S.C.A. 2601 et seq., as amended from time to time, and
any and all rules and regulations issued or promulgated
thereunder; or (f) any other federal or state law, statute,
rule, or emulation enacted in connection with or relating to
the protection or regulation of the environment (including,
without limitation, those laws, statutes, rules, and
regulations regulating the disposal, removal, production,
storing, refining, handling, transferring, processing, or
transporting of Hazardous Materials) and any rules and
regulations issued or promulgated in connection with any of
the foregoing by any governmental authority, and
"Environmental Laws" shall mean each of the foregoing.
"ERISA" shall mean the Employee Retirement Income
Security Act of 1974, as amended from time to time, and all
rules, regulations, rulings and interpretations thereof issued
by the Internal Revenue Service or the Department of Labor
thereunder.
"Eurocurrency Liabilities" shall have the meaning
assigned to that term in Regulation D of the Board of
Governors of the Federal Reserve System, as in effect from
time to time.
"Eurodollar Lending Office" shall mean the Bank's
office located at 000 Xxxxxx, Xxxxxxx, Xxxxx 00000 or such
other office of the Bank as the Bank may from time to time
specify to the Borrower.
"Eurodollar Rate" shall mean with respect to the
applicable Rate Period in effect for each Eurodollar Rate
Loan, the sum of (a) 1 percent (1%) plus (b) the quotient
obtained by dividing (i) the annual rate of interest
determined by the Bank, at or before 10:00 a.m. (Houston time)
(or as soon thereafter as practicable), on the second Business
Day prior to the first day of such Rate Period, to be the
annual rate of interest at which deposits of Dollars are
offered to the Bank by prime banks in whatever Eurodollar
interbank market may be selected by the Bank in its sole
discretion, acting in good faith, at the time of determination
and in accordance with the then existing practice in such
market for delivery on the first day of such Rate Period in
immediately available funds and having a maturity equal to
such Rate Period in an amount equal (or as nearly equal as may
be) to the unpaid principal amount of such Eurodollar Rate
Loan by (ii) a percentage equal to 100% minus the Eurodollar
Rate Reserve Percentage for such Rate Period. Each
determination of the Eurodollar Rate made by the Bank in
accordance with this paragraph shall be conclusive except in
the case of manifest error.
"Eurodollar Rate Loan" shall mean any Loan which
bears interest at the Eurodollar Rate.
"Eurodollar Rate Reserve Percentage" of the Bank
for any Rate Period for any Eurodollar Rate Loan shall mean
the reserve percentage applicable during such Rate Period (or
if more than one such percentage shall be so applicable, the
daily average of such percentages for those days in such Rate
Period during which any such percentage shall be so
applicable) under regulations issued from time to time by the
Board of Governors of the Federal Reserve System (or any
successor) for determining the maximum reserve requirement
(including, without limitation, any emergency, supplemental,
or other marginal reserve requirement) for member banks of the
Federal Reserve System with deposits exceeding $1,000,000,000
with respect to liabilities or assets consisting of or
including Eurocurrency Liabilities having a term equal to such
Rate Period.
"Event of Default" shall mean any of the events
specified in Section , provided that there has been satisfied
any applicable requirement in connection with such event for
the giving of notice, or the lapse of time, or the happening
of any further condition, event or act.
"Excess Cash Flow" shall mean, for any Period, an
amount equal to Gross Cash Receipts for such period, (i) minus
Operating Expenses for such Period other than interest
payments made on the secured Debt described in Subsection
11.2(f) of the Credit Agreement, (ii) plus (or minus) to the
extent not otherwise included in Gross Cash Receipts, the cash
effect of extraordinary gains (or the cash effect of
extraordinary losses) during such period, (iii) minus any
payments or prepayments of the Loans or Reimbursement
Obligations made hereunder, other than prepayments
representing Adjusted Excess Cash Flow made pursuant to
Subsection 5.1(a), (iv) minus any payments made to the Bank
consisting of MUD Proceeds or consisting of proceeds of the
Debt described in Section 11.2(g) of the Credit Agreement, (v)
minus the Borrower's Cash Reserve. The term "Excess Cash
Flow" when used in calculating payments to be made on the
loans permitted under Subsection 11.2(f) of the Credit
Agreement shall mean Excess Cash Flow calculated each Quarter-
Annual Period. Notwithstanding the foregoing, Excess Cash
Flow used to make payments on the loans permitted under
Subsection 11.2(f) of the Credit Agreement shall not consist
of any of the proceeds of the Revolving Credit Loans.
"Expiration Date" shall mean the last day of a
Rate Period.
"Facility Fee" shall mean the facility fee
specified in Section .
"Facility Letter(s) of Credit" shall mean, in the
singular form, any Standby Letter of Credit issued by the Bank
for the account of the Borrower pursuant to Section and, in
the plural form, all such Standby Letters of Credit issued for
the account of the Borrower.
"Facility Letter of Credit Fee" shall have the
meaning set forth in Section .
"Facility Letter of Credit Obligations" shall
mean, at any particular time, the sum of (a) the Reimbursement
Obligations, plus (b) the aggregate undrawn face amount of all
outstanding Facility Letters of Credit, in each case as
determined by the Bank.
"Federal Funds Rate" shall mean, for any period, a
fluctuating interest rate per annum equal for each day during
such period to the weighted average of the rates on overnight
Federal fund transactions with members of the Federal Reserve
System arranged by Federal funds brokers, as published for
such day (or, if such day is not a Business Day, of the next
preceding Business Day) by the Federal Reserve Bank of New
York, or, if such rate is not so published for any day which
is a Business Day, the average of the quotations for such day
on such transactions received by the Bank from three Federal
funds brokers of recognized standing selected by it.
"FM Properties" shall mean FM Properties Operating
Co., a Delaware general partnership.
"FTX Guaranty" shall mean the Amended and Restated
FTX Guaranty Agreement described in clause (ii) of the
definition of the term Guaranty Agreements.
"FTX Security Agreement" shall mean the FTX
Security Agreement dated as of July 17, 1995 between FREEPORT-
McMoRan Inc. as pledgor and Chemical as collateral agent for
the creditors party to the Second Amendment and Restatement
dated as of July 17, 1995 of the FTX Intercreditor Agreement
among Chemical, as agent for the FTX Lenders and as agent for
the FM Lenders and Hibernia National Bank, as agent for the
Pel-Tex Lenders, and the Bank and as further amended from time
to time.
"Funded Debt" shall mean (a) any obligation
payable more than one year from the date of the creation
thereof which would, in accordance with generally accepted
accounting principles, be shown on a balance sheet as a
liability and (b) any guaranty or any other contingent
liability (direct or indirect) in connection with the
obligations, stock or dividends of any Person and any
obligation under any contract which, in economic effect, is
the substantial equivalent of a guaranty.
"Governmental Authority" shall mean any (domestic
or foreign) federal, state, county, municipal, parish,
provincial, or other government, or any department,
commission, board, court, agency (including, without
limitation, the EPA), or any other instrumentality of any of
them or any other political subdivision thereof, and any
entity exercising executive, legislative, judicial,
regulatory, or administrative functions of, or pertaining to,
government, including, without limitation, any arbitration
panel, any court, or any commission.
"Gross Cash Receipts" shall mean all cash receipts
of any kind or character, including but not limited to
proceeds of the Revolving Credit Loans and the loans permitted
under Section 11.2(f) of the Credit Agreement, receipts
relating to the sale of single-family and multi-family lots,
receipts from leases and the sale of land for retail, office,
and research and development use, golf course income, gas
refunds, lot interest income, bond refunds and bond proceeds,
including the MUD Proceeds, or loan proceeds relating thereto.
"Guarantor" shall mean FREEPORT-McMoRan INC., a
Delaware corporation.
"Guaranty Agreements" shall mean (i) the Amended
and Restated Guaranty Agreement dated of even date herewith,
for the benefit of the Bank, executed by FREEPORT-McMoRan
INC., substantially in the form of the Amended and Restated
Guaranty Agreement attached hereto as Exhibit "E", covering
all obligations of the Borrower under the Loan Documents other
than principal and interest on the Notes, and any and all
amendments, modifications, renewals and extensions thereof;
and (ii) the Amended and Restated FTX Guaranty Agreement,
dated as of December 20, 1996, executed by FREEPORT- McMoRan
INC., partially guaranteeing inter alia the payment of
principal and interest on the Notes, substantially in the form
of the FTX Guaranty Agreement attached as Exhibit "F", and any
and all amendments, modifications, renewals and extensions
thereof, which FTX Guaranty Agreement is secured by the FTX
Security Agreement more particularly described therein.
"Hazardous Materials" shall mean (a) any
"hazardous waste" as defined by RCRA; (b) any "hazardous
substance" as defined by CERCLA; (c) asbestos;
(d) polychlorinated biphenyls; (e) any flammables, explosives
or radioactive materials; (f) any substance, the presence of
which on any of the Borrower's properties is prohibited by any
governmental authority; and (g) any other substance which,
pursuant to any Environmental Laws, requires special handling
in its collection, use, storage, treatment or disposal.
"Highest Lawful Rate" shall mean, with respect to
the Bank, the maximum nonusurious interest rate, if any, that
at any time or from time to time may be contracted for, taken,
reserved, charged, or received with respect to the Notes or on
other amounts, if any, due to the Bank pursuant to this
Agreement or any other Loan Document, under laws applicable to
the Bank which are presently in effect, or, to the extent
allowed by law, under such applicable laws which may hereafter
be in effect and which allow a higher maximum nonusurious
interest rate than applicable laws now allow.
"Indemnified Parties" shall have the meaning set
forth in Section .
"Interest Payment Date" shall mean (a) as to any
Base Rate Loan, the sixth (6th) day of each May, August,
November and February throughout the term of the Base Rate
Loan, beginning with May 6, 1992 (or if any such date is not a
Business Day, then the next preceding Business Day); (b) as to
any Eurodollar Rate Loan, the sixth (6th) day of each May,
August, November and February throughout the term of the
Eurodollar Rate Loan.
"L/C Maturity Date" shall mean February 28, 1998.
"L/C Termination Date" shall mean February 28,
1997.
"Liabilities" shall mean all obligations which
would, in accordance with generally accepted accounting
principles, be classified on a balance sheet as liabilities,
including, without limitation, (i) indebtedness secured by
Liens against property of the Borrower whether or not the
Borrower is liable for the payment thereof and (ii) deferred
liabilities.
"Letter(s) of Credit" shall mean, in the singular
form, any letter of credit issued by any Person for the
account of the Borrower and, in the plural form, all such
letters of credit issued by any Person for the account of the
Borrower.
"Letter of Credit Commitment" shall mean the
Bank's commitment to issue Facility Letters of Credit up to an
aggregate amount of $85,573.00.
"Letter of Credit Reimbursement Agreement" shall
mean, with respect to a Facility Letter of Credit, such form
of application therefor and form of reimbursement agreement
therefor (whether in a single or several documents, taken
together) as the Bank may employ in the ordinary course of
business for its own account, whether or not providing for
collateral security, with such modifications thereto as may be
agreed upon by the Bank and the account party; provided,
however, in the event of any conflict between the terms of any
Letter of Credit Reimbursement Agreement and this Agreement,
the terms of this Agreement shall control.
"Lien" shall mean any claim, mortgage, deed of
trust, pledge, security interest, encumbrance, lien,
mechanic's or materialmen's lien, or charge of any kind
(including, without limitation, any agreement to give any of
the foregoing, any conditional sale or other title retention
agreement or any lease in the nature thereof).
"Loan" or "Loans" shall mean a loan or loans,
respectively, from the Bank to the Borrower made under this
Agreement. "Term Loan" shall mean the Loan made under
Section . "Revolving Credit Loan" shall mean any Loan made
under Section .
"Loan Documents" shall mean this Agreement, the
Notes, all Security Documents, and all instruments,
certificates and agreements now or hereafter executed or
delivered to the Bank pursuant to any of the foregoing and the
transactions connected therewith, and all amendments,
modifications, renewals, extensions, increases and
rearrangements of, and substitutions for, any of the
foregoing.
"Material Adverse Effect" shall mean any material
adverse effect on (a) the financial condition, business,
properties, assets, prospects or operations of the Borrower,
or (b) the ability of the Borrower or any Person to perform
its respective obligations under this Agreement or any other
Loan Document to which it is a party on a timely basis.
"Maturity Date" shall mean the Revolving Maturity
Date or the Term Maturity Date, as the case may be.
"MUD Proceeds" shall mean all proceeds from the
sale of bonds issued by Circle C Municipal Utility District #3
or Circle C Municipal Utility District #4 or by any other
CCMUD (as defined in the Phoenix Purchase Agreement) prior to
the closing of the Phoenix Purchase and allocable to
reimbursement of eligible infrastructure.
"Non-Facility Letter of Credit" shall mean any
Letter of Credit which is not a Facility Letter of Credit.
"Note" or "Notes" shall mean a promissory note or
promissory notes, respectively, of the Borrower, executed and
delivered under this Agreement. "Term Note" shall mean the
promissory note of the Borrower executed and delivered under
Section . "Revolving Note" shall mean the promissory note of
the Borrower executed and delivered under Section 2.2.
"Notice of Borrowing" shall mean a Notice of
Revolving Loan Borrowing or a Notice of Term Loan Borrowing,
as the case may be, or, in the case of a combination of the
two as reflected in Exhibit "C", a combined Notice of
Borrowing. A Notice of Borrowing of whatever type shall be
limited to three different combinations of interest rates,
types of Loans and Rate Periods.
"Notice of Rate Change/Continuation" shall have
the meaning set forth in Section (a)(ii).
"Notice of Revolving Loan Borrowing" shall have
the meaning set forth in Section (c).
"Notice of Term Loan Borrowing" shall have the
meaning set forth in Section (c).
"Officer's Certificate" shall mean a certificate
signed in the name of the Borrower by either its President,
one of its Vice Presidents, its Treasurer, its Secretary or
one of its Assistant Treasurers or Assistant Secretaries.
"Operating Expenses" shall mean, without
duplication, for any period, (i) the amount of any interest
expense to the extent paid in cash, plus (ii) income taxes
paid in cash in such period, plus (iii) development,
operating, holding, and marketing expenses of whatever kind or
character related to the development of the Circle C Tract,
including the following costs, expenses, and expense
categories: construction costs, landscape, taxes, amenities,
management fees, legal fees, insurance, accounting,
advertising, closing costs, homeowners fees, and M.U.D.
standby fees.
"Option Agreement" shall mean that certain Option
Agreement dated effective February 6, 1992, entered into by
Xxxxx X. Xxxxxxxx, Trustee, and Borrower, pursuant to which
Borrower granted Xxxxx X. Xxxxxxxx, Trustee, an option to
purchase the Circle C Tract on the terms and conditions set
forth therein, the ownership rights to such option having been
transferred by Xxxx of Sale to FM Properties. The Option
Agreement is currently held for the benefit of FM Properties
by Xxxxxxx X. Xxxxx, Trustee, as reflected in that Notice of
Change of Trustee, dated March 16, 1993, recorded in
Volume 11894, Page 389, Real Property Records of Xxxxxx
County, Texas
"Party" or "Parties" shall mean a Person or all
Persons other than the Bank executing any Loan Document.
"Period" shall mean any Quarter-Annual Period.
"Person" shall mean an individual, partnership,
joint venture, corporation, joint stock company, bank, trust,
unincorporated organization and/or a government or any
department or agency thereof. "Persons" shall mean the plural
of Person.
"Phoenix Purchase" shall mean the purchase by
Phoenix Holdings, Ltd. of the commercial land described as the
"Land" in the Phoenix Purchase Agreement (the "Phoenix
Purchase Land"), and consisting of a portion of the Circle C
Tract, pursuant to the terms and provisions of the Phoenix
Purchase Agreement.
"Phoenix Purchase Agreement" shall mean the
Purchase and Sale Agreement effective as of May 31, 1996, by
and between Borrower and Phoenix Holdings, Ltd. and covering
the purchase by Phoenix Holdings, Ltd of the Phoenix Purchase
Land, as amended by (i) the First Addendum to Purchase and
Sale Agreement effective as of May 30, 1996, by and between
Borrower, Phoenix Holdings, Ltd. and FM Properties Inc.; and
(ii) the Second Addendum to Purchase and Sale Agreement
effective September 10, 1996, by and between Phoenix Holdings,
Ltd. and Borrower.
"Plan" shall mean any plan subject to Title IV of
ERISA and maintained for employees of the Borrower or of any
member of a "controlled group of corporations," as such term
is defined in the Code, of which the Borrower is a member, or
any such plan to which the Borrower is required to contribute
on behalf of its employees.
"Prime Rate" shall mean the prime rate announced
from time to time by the Bank, and thereafter entered in the
minutes of the Bank's Senior Credit Origination Committee.
Without notice to the Borrower or any other Person, the Prime
Rate shall change automatically from time to time as and in
the amount by which said Prime Rate shall fluctuate, with each
such change to be effective as of the date of each change in
such Prime Rate. The Prime Rate is a reference rate and does
not necessarily represent the lowest or best rate actually
charged to any customer. The Bank may make commercial or
other loans at rates of interest at, above or below the Prime
Rate.
"Quarter-Annual Period" shall mean (i) each period
from January 1 of any calendar year through March 31 of the
same calendar year; (ii) each period from April 1 of any
calendar year through June 30 of the same calendar year; (iii)
each period from July 1 of any calendar year through September
30 of the same calendar year; and (iv) each period from
October 1 of any calendar year through December 31 of the same
calendar year.
"Rate Period" shall mean the period of time for
which the Eurodollar Rate shall be in effect as to any
Eurodollar Rate Loan, commencing with the Date or the
Expiration Date of the immediately preceding Rate Period, as
the case may be, applicable to and ending on the effective
date of any rate change or rate continuation made as provided
in Section (a) as the Borrower may specify in the Notice of
Borrowing or the Notice of Rate Change/Continuation, subject,
however, to the early termination provisions of the second
sentence of Section (c) relating to any Eurodollar Rate Loan;
provided, however, that any Rate Period which would otherwise
end on a day which is not a Business Day shall be extended to
the next succeeding Business Day unless such Business Day
falls in another calendar month, in which case such Rate
Period shall end on the next preceding Business Day.
"Release" shall mean a "release", as such term is
defined in CERCLA.
"Reimbursement Obligations" shall mean the
reimbursement or repayment obligations of the Borrower to Bank
pursuant to this Agreement or the applicable Letter of Credit
Reimbursement Agreement with respect to Facility Letters of
Credit issued for the account of the Borrower.
"Reportable Event" shall have the meaning set
forth in Section
"Revolving Loan Commitment" shall have the meaning
set forth in Section (a).
"Revolving Maturity Date" shall mean February 28,
1998.
"Revolving Note" shall mean the Amended and
Restated Revolving Note described in Section 2.2(b) of the
Credit Agreement.
"Revolving Termination Date" shall mean February
28, 1998.
"Second Closing Date" shall mean December 20,
1996.
"Securities Act" shall have the meaning set forth
in Section .
"Security Documents" shall mean the Guaranty
Agreements, as they may be amended or modified from time to
time, and any and all other agreements, deeds of trust,
mortgages, chattel mortgages, security agreements, pledges,
guaranties, assignments of production or proceeds of
production, assignments of income, assignments of contract
rights, assignments of partnership interest, assignments of
royalty interests, assignments of performance, completion or
surety bonds, standby agreements, subordination agreements,
undertakings and other instruments and financing statements
now or hereafter executed and delivered by any Person (other
than solely by the Bank and/or any other creditor
participating in the Loans evidenced by the Notes or any
collateral or security therefor) in connection with, or as
security for the payment or performance of, the Notes, any
indebtedness renewed or extended by such Notes and the
Borrower's obligations under this Agreement.
"Term Loan Commitment" shall have the meaning set
forth in Section (a).
"Term Maturity Date" shall mean February 28, 1998.
"Term Note" shall mean the Amended and Restated
Term Note described in Section 2.1(b) of the Credit Agreement.
"Type" shall mean, with respect to any Loan, any
Base Rate Loan or any Eurodollar Rate Loan.
"Unused L/C Facility" shall mean, at any time, the
amount, if any, by which the Letter of Credit Commitment
exceeds the aggregate outstanding amount of all Facility
Letter of Credit Obligations.
2. THE LOANS.
2.1. Term Loan.
(a) Upon the terms and conditions and relying
upon the representations and warranties herein set forth, the
Bank agrees to make a Term Loan to the Borrower in the amount
of $15,628,358.00 (the "Term Loan Commitment") on the Closing
Date.
(b) The Borrower shall execute and deliver to
the Bank to evidence the Term Loan made by the Bank under the
Term Loan Commitment, an Amended and Restated Term Note, which
shall be (i) dated the Second Closing Date; (ii) in the
principal amount of the Term Loan Commitment; and (iii) in
substantially the form attached hereto as Exhibit "A" with the
blanks appropriately filled. Borrower shall not be required
to make any principal installment payments on the Term Loan
provided, however, that the Borrower shall make the required
prepayment described in Subsection 5.1(d) of the Credit
Agreement and to pay in full all outstanding principal and
interest on the Term Loan on the Term Maturity Date. The Term
Note shall bear interest on the unpaid principal amount
thereof from time to time outstanding at the rate per annum
determined as specified in Sections , and , payable on each
Interest Payment Date and at maturity, commencing with the
first Interest Payment Date following the date of the Term
Note. Any amount of principal which is not paid when due
(whether at stated maturity, by acceleration or otherwise)
shall bear interest at a rate which shall be equal to the
lesser of (x) two percent (2%) above the Base Rate or (y) the
Highest Lawful Rate.
(c) The borrowing hereunder shall be in the
amount of the Term Loan Commitment. The Term Loan shall be
made upon prior written notice from the Borrower to the Bank
(the "Notice of Term Loan Borrowing") delivered to the Bank
not later than 11:00 a.m. (Houston time) (i) on the third
Business Day prior to the Closing Date, if such borrowing
consists of Eurodollar Rate Loans and (ii) on the Closing
Date, if such borrowing consists of Base Rate Loans. The
Notice of Term Loan Borrowing shall be irrevocable and shall
specify (i) the rate of interest that the Term Loan shall
bear; (iii) with respect to any Eurodollar Rate Loan, the
initial Rate Period with respect thereto and the Expiration
Date of the initial Rate Period; and (iv) the demand deposit
account of the Borrower at the Bank's Applicable Lending
Office into which the proceeds of the borrowing are to be
deposited or instructions for wire transfer of such proceeds
of the borrowing or other disposition of the borrowing in
accordance with a Third Party Loan Proceeds Disbursement
Authorization. The Borrower may designate up to three
different combinations of interest rates and Rate Periods in
any Notice of Borrowing. The Borrower may give the Bank
telephonic notice by the required time of any proposed
borrowing under this Section ; provided, that such telephonic
notice shall be confirmed in writing by delivery to the Bank
promptly (but in no event later than the Closing Date) of a
Notice of Term Loan Borrowing. The Bank shall not incur any
liability to the Borrower in acting upon any telephonic notice
referred to above which the Bank believes in good faith to
have been given by the Borrower, or for otherwise acting in
good faith under this Section .
(d) Upon fulfillment of the applicable
conditions set forth in Section , on the Closing Date, the
Bank shall make the borrowing available to the Borrower at the
Bank's Applicable Lending Office in immediately available
funds. The Bank shall pay or deliver the proceeds of the
borrowing to or upon the order of the Borrower against
delivery to the Bank of the Term Note. Any deposit to the
Borrower's demand deposit account by the Bank or any wire
transfer of the proceeds of the borrowing pursuant to a
request (whether written or oral) believed by the Bank to be
an authorized request by the Borrower for the Term Loan
hereunder shall be deemed to be the Term Loan hereunder for
all purposes with the same effect as if the Borrower had in
fact requested the Bank to make such Term Loan.
(e) Any payment (other than a prepayment) made
on the Term Loan at such time as accrued but unpaid interest
on any of the Loans is outstanding shall be applied in the
following order: (i) to accrued but unpaid interest on the
Term Loan; (ii) to accrued but unpaid interest on the
Revolving Credit Loans; and (iii) to the next consecutive
installment(s) of principal on the Term Loan.
2.2. Revolving Credit Loans.
(a) Upon the terms and conditions and relying
upon the representations and warranties herein set forth, the
Bank agrees to make Revolving Credit Loans to the Borrower on
any one or more Business Days prior to the Revolving
Termination Date, up to an aggregate principal amount of
Revolving Credit Loans not exceeding at any one time
outstanding $13,500,000.00 (such amount, as it may be reduced
from time to time pursuant to Section 5.8 being the Bank's
"Revolving Loan Commitment"). Within such limits and during
such period and subject to the terms and conditions of this
Agreement, the Borrower may borrow, repay and reborrow
hereunder.
(b) The Borrower shall execute and deliver to
the Bank to evidence the Revolving Credit Loans made by the
Bank under the Bank's Revolving Loan Commitment, an Amended
and Restated Revolving Note, which shall be (i) dated the date
of the initial Revolving Credit Loan made hereunder; (ii) in
the principal amount of the Revolving Loan Commitment; and
(iii) in substantially the form attached hereto as Exhibit "B"
with the blanks appropriately filled. The outstanding
principal balance of the Revolving Note shall be payable on or
before the Revolving Maturity Date. The Revolving Note shall
bear interest on the unpaid principal amount thereof from time
to time outstanding at the rate per annum determined as
specified in Sections , and , payable on each Interest
Payment Date and at maturity, commencing with the first
Interest Payment Date following the date of the Revolving
Note. Any amount of principal which is not paid when due
(whether at stated maturity, by acceleration or otherwise)
shall bear interest at a rate which shall be equal to the
lesser of (x) two percent (2%) above the Base Rate or (y) the
Highest Lawful Rate.
(c) The Borrower may borrow under the Revolving
Loan Commitment up to but no more than two (2) times per
calendar month. Each borrowing hereunder shall be (i) in the
case of any Eurodollar Rate Loan, in an aggregate amount of
not less than $100,000.00; or (ii) in the case of any Base
Rate Loan, in an aggregate amount of not less than $100,000.00
and, at the option of the Borrower, any borrowing under this
Section may be comprised of up to two such Revolving Credit
Loans bearing different rates of interest. Each Loan shall be
made upon prior written notice from the Borrower to the Bank
(the "Notice of Revolving Loan Borrowing") delivered to the
Bank not later than 11:00 a.m. (Houston time) (i) on the third
Business Day prior to the Borrowing Date, if such borrowing
consists of Eurodollar Rate Loans; and (ii) on the Borrowing
Date, if such borrowing consists of Base Rate Loans. Each
Notice of Revolving Loan Borrowing shall be irrevocable and
shall specify (i) the amount of the proposed borrowing and of
each Revolving Credit Loan comprising a part thereof; (ii) the
Borrowing Date; (iii) the rate of interest that each such
Revolving Credit Loan shall bear; (iv) with respect to any
Eurodollar Rate Loan, the Rate Period with respect to each
such Revolving Credit Loan and the Expiration Date of each
such Rate Period; and (v) the demand deposit account of the
Borrower at the Bank's Domestic Lending Office into which the
proceeds of the borrowing are to be deposited, or instructions
for wire transfer of such proceeds of the borrowing, or other
disposition of the borrowing in accordance with a Third Party
Loan Proceeds Disbursement Authorization. The Borrower may
give the Bank telephonic notice by the required time of any
proposed borrowing under this Section ; provided, that such
telephonic notice shall be confirmed in writing by delivery to
the Bank promptly (but in no event later than the Borrowing
Date relating to any such borrowing) of a Notice of Revolving
Loan Borrowing. The Bank shall not incur any liability to the
Borrower in acting upon any telephonic notice referred to
above which the Bank believes in good faith to have been given
by the Borrower, or for otherwise acting in good faith under
this Section.
(d) Upon fulfillment of the applicable
conditions set forth in Section , on the Borrowing Date, the
Bank shall make the borrowing available to the Borrower at its
Applicable Lending Office in immediately available funds. The
Bank shall pay or deliver the proceeds of the initial
borrowing to or upon the order of the Borrower against
delivery to the Bank of the Revolving Note. Any deposit to
the Borrower's demand deposit account by the Bank or any wire
transfer of the proceeds of the borrowing pursuant to a
request (whether written or oral) believed by the Bank to be
an authorized request by the Borrower for a Revolving Credit
Loan hereunder shall be deemed to be a Revolving Credit Loan
hereunder for all purposes with the same effect as if the
Borrower had in fact requested the Bank to make such Revolving
Credit Loan.
(e) Any payment (other than a prepayment) made
on the Revolving Credit Loans at such time as accrued but
unpaid interest on any of the Loans is outstanding shall be
applied in the following order: (i) to accrued but unpaid
interest on the Revolving Credit Loans; (ii) to accrued but
unpaid interest on the Term Loan; and (iii) if such payment is
made on the Maturity Date, after application to (i) and (ii),
then to the outstanding principal balance on the Revolving
Credit Loans.
3. LETTERS OF CREDIT.
3.1. Obligation to Issue. Subject to the terms
and conditions of this Agreement, and in reliance upon the
representations and warranties of the Borrower set forth
herein or in any other Loan Document, the Bank hereby
severally agrees to issue, from time to time during the period
commencing on the Closing Date and ending on the L/C
Termination Date, for the account of the Borrower through such
of the Bank's branches as it and the Borrower may jointly
agree, one or more Facility Letters of Credit in accordance
with this Section . Notwithstanding the foregoing, the Bank
shall have no obligation to issue, and shall not issue, any
Facility Letter of Credit at any time if:
(a) the aggregate undrawn face amount of
Facility Letters of Credit theretofore issued by the Bank,
after giving effect to all requested but unissued Facility
Letters of Credit, exceeds any limit imposed by law or
regulation upon the Bank;
(b) the aggregate principal amount of Facility
Letter of Credit Obligations with respect to Facility Letters
of Credit issued by the Bank for the account of the Borrower
would exceed the Bank's Letter of Credit Commitment;
(c) immediately after giving effect to the
issuance of such Facility Letter of Credit, the aggregate
Facility Letter of Credit Obligations would exceed the Bank's
Letter of Credit Commitment; or
(d) such Facility Letter of Credit has an
expiration date (i) more than one year after the date of
issuance; or (ii) after the L/C Maturity Date.
3.2. Conditions. The obligation of the Bank to
issue any Facility Letter of Credit is subject to the
satisfaction in full of the applicable conditions precedent
set forth in Section and each of the following conditions:
(a) the Borrower shall have delivered to the
Bank, at such times and in such manner as the Bank may
prescribe, a Letter of Credit application, a Letter of Credit
Reimbursement Agreement, and such other documents and
materials as may be required pursuant to the terms thereof;
(b) the terms of the proposed Facility Letter of
Credit shall not be inconsistent with any term or provision of
this Agreement and otherwise shall be satisfactory to the
Bank;
(c) the Guaranty Agreements shall be in full
force and effect; and
(d) as of the date of issuance of such Facility
Letter of Credit, no order, judgment, or decree of any court,
arbitrator, or governmental authority shall purport by its
terms to enjoin or restrain the Bank from issuing such
Facility Letter of Credit, and no law, rule, or regulation
applicable to the Bank, and no request or directive (whether
or not having the force of law) from any governmental
authority having jurisdiction over the Bank, shall prohibit or
request the Bank refrain from the issuance of Letters of
Credit generally or the issuance of such Facility Letter of
Credit.
3.3. Issuance of Facility Letters of Credit.
(a) Except with respect to the issuance of the Letters of
Credit described on Schedule attached hereto on the Closing
Date, the Borrower shall give the Bank written notice (or
telephonic notice confirmed in writing by the Borrower not
later than the requested issuance date of the Facility Letter
of Credit) of its request for the issuance of a Facility
Letter of Credit no later than 11:00 a.m. four (4) Business
Days prior to the date such Facility Letter of Credit is
requested to be issued. Such notice shall be irrevocable and
shall specify, with respect to such requested Facility Letter
of Credit, the face amount, beneficiary, effective date of
issuance, expiry date (which effective date and expiry date
shall be a Business Day and, with respect to the expiry date,
shall be no later than the Business Day immediately preceding
the Revolving Termination Date), and the purpose for which
such Facility Letter of Credit is to be issued. If the face
amount of the requested Facility Letter of Credit is less than
or equal to the Unused L/C Facility, as determined by the Bank
as of the close of business on the date of its receipt of
written notice of the requested issuance, the Bank shall issue
such Facility Letter of Credit on the date requested by the
Borrower, unless on the requested issuance date, the Bank has
actual knowledge that such conditions precedent have not been
met. If the Bank receives or has actual knowledge, that the
conditions precedent to the issuance of a Facility Letter of
Credit have not been met, then the Bank shall have no
obligation to issue, and shall not issue, any Facility Letter
of Credit until the Bank receives information to the effect
that the condition(s) precedent have been met. Any Letter of
Credit issued by the Bank in compliance with the provisions of
this Section shall be a Facility Letter of Credit, and the
Standby Letters of Credit described on Schedule shall be
Facility Letters of Credit.
(b) The Bank shall not extend or amend any
Facility Letter of Credit unless the requirements of this
Section are met as though a new Facility Letter of Credit was
being requested and issued.
(c) Upon the expiration of any Facility Letter
of Credit, the Borrower may re-use any portion of the Letter
of Credit Commitment for the issuance of new Facility Letters
of Credit prior to the L/C Termination Date.
(d) The Bank may (but has no obligation
hereunder to) issue Non-Facility Letters of Credit. None of
the provisions of this Section shall apply to any Letter of
Credit designated by the Bank as a Non-Facility Letter of
Credit.
3.4. Reimbursement Obligations; Duties of the
Bank.
(a) Notwithstanding any provisions to the
contrary in any Letter of Credit Reimbursement Agreement:
(i) the Borrower shall reimburse the Bank for a
drawing under a Facility Letter of Credit issued by the Bank
no later than the earlier of (A) the time specified in the
related Letter of Credit Reimbursement Agreement; or (B) one
(1) Business Day after the payment of such drawing by the
Bank; and
(ii) the Borrower's Reimbursement Obligations
with respect to a drawing under a Facility Letter of Credit
shall bear interest from the date of such drawing to the date
paid in full at the lesser of (A) the Highest Lawful Rate; or
(B) the interest rate for past due Base Rate Loans.
(b) No action taken or omitted to be taken by
the Bank in connection with any Facility Letter of Credit
shall (i) result in any liability on the part of the Bank to
the Borrower, unless the Bank's action or omission constitutes
willful misconduct or gross negligence. Prior to making any
payment to a beneficiary with respect to a drawing under a
Facility Letter of Credit, the Bank shall be responsible only
to confirm that documents required by the terms of such
Facility Letter of Credit to be delivered as a condition
precedent to such drawing have been delivered and that the
same appear on their face to conform with the requirements
thereof. The Bank may assume that documents appearing on
their face to be the documents required to be delivered as a
condition precedent to a drawing do in fact comply.
3.5. Payment of Reimbursement Obligations. The
Borrower agrees to pay to the Bank the amount of all
Reimbursement Obligations, interest, and other amounts payable
to the Bank under or in connection with any Facility Letter of
Credit immediately when due, irrespective of any claim,
set-off, defense, or other right which the Borrower may have
at any time against the Bank or any other Person.
3.6. Exoneration. As between the Borrower and
the Bank, the Borrower assumes all risks of the acts and
omissions of, or misuse of the Facility Letter of Credit
issued by the Bank by, the respective beneficiaries of such
Facility Letter of Credit. In furtherance and not in
limitation of the foregoing, subject to the provisions of the
Letter of Credit applications, the Bank shall not be
responsible for:
(a) the form, validity, sufficiency, accuracy,
genuineness, or legal effect of any document submitted by any
party in connection with the application for and issuance of a
Facility Letter of Credit, even if it should in fact prove to
be in any or all respects invalid, insufficient, inaccurate,
fraudulent, or forged;
(b) the validity or sufficiency of any
instrument transferring or assigning or purporting to transfer
or assign a Facility Letter of Credit or the rights or
benefits thereunder or proceeds thereof, in whole or in part,
which may prove to be invalid or ineffective for any reason;
(c) failure of the beneficiary of a Facility
Letter of Credit to comply duly with conditions required in
order to draw upon such Facility Letter of Credit, provided
that the Bank complies with the provisions of Section ;
(d) errors, omissions, interruptions, or delays
in transmission or delivery of any messages, by mail, cable,
telegraph, telex, or otherwise, whether or not they be in
cipher;
(e) errors in interpretation of technical terms;
(f) any loss or delay in the transmission or
otherwise of any document required in order to make a drawing
under any Facility Letter of Credit or of the proceeds
thereof;
(g) the misapplication by the beneficiary of a
Facility Letter of Credit; or
(h) any consequences arising from causes beyond
the control of the Bank, including, without limitation, any
act or omission, whether rightful or wrongful, of any present
or future de jure or de facto government or Governmental
Authority. In furtherance and extension and not in limitation
of the specific provisions hereinabove set forth, any action
taken or omitted by the Bank under or in connection with the
Facility Letters of Credit or any related certificates, if
taken or omitted in good faith and not constituting gross
negligence or willful misconduct, shall not put the Bank under
any resulting liability to the Borrower or relieve the
Borrower of any of its obligations hereunder to any such
Person.
3.7. Compensation for Facility Letters of Credit.
(a) Facility Letter of Credit Fee. The Borrower
agrees to pay to the Bank quarterly, in the case of a Letter
of Credit issued as a Facility Letter of Credit, a facility
letter of credit fee (the "Facility Letter of Credit Fee")
(i) as to Facility Letters of Credit which expire on the last
day of the quarter or later, in the amount of one-quarter of
one percent (1/4%) of the aggregate face amount of any such
Facility Letters of Credit; and (ii) as to Facility Letters of
Credit which expire prior to the last day of the quarter, in
the amount of one-quarter of one percent (1/4%) of the face
amount of each such Facility Letter of Credit multiplied by a
fraction, the numerator of which is the actual number of days
in such quarter prior to expiration of such Facility Letter of
Credit and the denominator of which is the actual number of
days in the quarter; provided, however, notwithstanding the
foregoing, as to each Facility Letter of Credit with an
outstanding face amount less than an amount that would
generate at least a $300.00 per annum Facility Letter of
Credit Fee, a minimum Facility Letter of Credit Fee in the
amount of $300.00 shall be payable in advance on the day of
the issuance of such Facility Letter of Credit, and no
additional Facility Letter of Credit Fee on any such Facility
Letter of Credit shall be required for the three subsequent
quarters. The Borrower shall also pay to the Bank in the
event of any extension or modification of a Facility Letter of
Credit which extends the expiration date or increases the
maximum amount available for drawing thereunder an additional
fee calculated and payable on the same basis as that set forth
in the first sentence of this Section with respect to any
such extension or additional amount.
(b) Increased Capital. If either (i) the
introduction of or any change in or in the interpretation of
any law or regulation, or (ii) compliance by the Bank with any
guideline or request from any central bank or other
Governmental Authority (whether or not having the force of
law) affects or would affect (by an amount deemed by the Bank
to be material) the capital required or expected to be
maintained by it or any corporation controlling it, and the
Bank determines, on the basis of reasonable allocations, that
the amount of such capital is increased by (an amount deemed
by the Bank to be material) or is based (to a degree deemed by
the Bank to be material) upon its issuance or maintenance of,
or commitment to issue the Facility Letters of Credit then,
upon demand by the Bank, the Borrower shall immediately pay to
the Bank, from time to time as specified by the Bank,
additional amounts sufficient to compensate the Bank therefor.
A certificate as to such amounts submitted to the Borrower by
the Bank shall, in the absence of manifest error, be
conclusive and binding for all purposes.
4. INTEREST RATE PROVISIONS.
4.1. Interest Rate Determination.
(a) Except as specified in Sections and , the
Loans shall bear interest on the unpaid principal amount
thereof from time to time outstanding, until maturity, at a
rate per annum (calculated based on a year of 360 days in the
case of the Eurodollar Rate, and a year of 365 or 366 days, as
the case may be, in the case of the Base Rate) as follows:
(i) The Loans shall bear interest at an annual
rate equal to the lesser of (A) the rate specified in the
Notice of Borrowing or the Notice of Rate Change/Continuation,
as the case may be, with respect thereto or (B) the Highest
Lawful Rate, from the first day to, but not including,
(y) with respect to any Base Rate Loan, the Maturity Date
applicable thereto and (z) with respect to any Eurodollar Rate
Loan, the Expiration Date of the Rate Period then in effect
with respect thereto.
(ii) So long as no Default or Event of Default
has occurred and is continuing, the Borrower may (y) change
the interest rates to apply to any Loan or (z) elect to
continue all or any part of the outstanding principal balance
of any Eurodollar Rate Loan as a Loan of such Type by giving
the Bank a written notice (the "Notice of Rate
Change/Continuation") specifying (A) the date on which such
Loan was made; (B) the interest rate then applicable to such
Loan; (C) with respect to any Eurodollar Rate Loan, the Rate
Period then applicable to each such Loan; (D) the principal
amount of such Loan to remain outstanding; (E) the rate of
interest and, with respect to any Eurodollar Rate Loan, the
Rate Period to become applicable to such Loan on the effective
date of the rate change or continuation; (F) the effective
date of the rate change or continuation (the
"Conversion/Continuation Date") (which shall be not less than
three (3) Business Days after the date of such Notice of Rate
Change/Continuation); and (G) with respect to any Eurodollar
Rate Loan, the duration and Expiration Date of each such Rate
Period. In the case of the conversion of all or any part of
any Base Rate Loan into a Eurodollar Rate Loan or the
continuation of any Eurodollar Rate Loan as a Loan of such
Type, such Notice must be received by the Bank at least three
(3) full Business Days prior to the Conversion/Continuation
Date. Each rate so specified shall become effective on the
Conversion/Continuation Date and remain in effect until the
expiration of the applicable Rate Period specified in such
Notice of Rate Change/Continuation.
(iii) If the Borrower shall fail to choose, as
provided in clause (ii) above, the rate of interest to become
effective with respect to any Eurodollar Rate Loan upon the
Expiration Date of the Rate Period with respect thereto, such
Loan shall bear interest at the Base Rate on and after such
Expiration Date until the Borrower shall have so chosen a
different rate.
(iv) Nothing contained herein shall authorize the
Borrower (A) to convert any Loan into or continue any Loan as
a Eurodollar Rate Loan unless the Expiration Date of the Rate
Period for such Loan occurs on or before the Maturity Date
applicable thereto or (B) to continue or change the interest
rates applicable to any Eurodollar Rate Loan prior to the
Expiration Date of the Rate Period with respect thereto.
(v) Notwithstanding anything set forth herein to
the contrary, if an Event of Default has occurred and is
continuing, each outstanding Eurodollar Rate Loan shall bear
interest at the Base Rate on and after the Expiration Date of
the Rate Period with respect thereto.
4.2. Additional Interest Rate Provisions.
(a) The Notes may be held by the Bank for the
account of its Domestic Lending Office or its Eurodollar
Lending Office, and may be transferred from one to the other
from time to time as the Bank may determine.
(b) If the Borrower shall have chosen the
Eurodollar Rate in a Notice of Borrowing or a Notice of Rate
Change/Continuation and prior to the Borrowing Date or
Conversion/Continuation Date, as the case may be, the Bank in
good faith determines (which determination shall be
conclusive) that (i) deposits in Dollars in the principal
amount of such Eurodollar Rate Loan are not being offered to
the Eurodollar Lending Office of the Bank in the interbank
market selected by the Bank in determining the applicable
Eurodollar Rate for the Rate Period applicable thereto or
(ii) adequate and reasonable means do not exist for
ascertaining the chosen Eurodollar Rate in respect of such
Eurodollar Rate Loan or (iii) the Eurodollar Rate for any Rate
Period for such Eurodollar Rate Loan will not adequately
reflect the cost to the Bank of making such Eurodollar Rate
Loan for such Rate Period, then such Eurodollar Rate shall not
become effective as to such Eurodollar Rate Loan on such
Borrowing Date or the Conversion/Continuation Date, as the
case may be, or at any time thereafter until such time
thereafter as the Borrower receives notice from the Bank that
the circumstances giving rise to such determination no longer
apply and such Loan shall bear interest at the lesser of
(i) the Base Rate or (ii) the Highest Lawful Rate.
(c) Anything in this Agreement to the contrary
notwithstanding, if at any time the Bank in good faith
determines (which determination shall be conclusive) that the
introduction of or any change in any applicable law, rule or
regulation or any change in the interpretation or
administration thereof by any governmental or other regulatory
authority charged with the interpretation or administration
thereof shall make it unlawful for the Bank (or the Eurodollar
Lending Office of the Bank) to maintain or fund any Eurodollar
Rate Loan or to convert any Loan into, or to continue any
Eurodollar Rate Loan as, a Eurodollar Rate Loan, hereunder,
the Bank shall give notice thereof to the Borrower. With
respect to any Eurodollar Rate Loan which is outstanding when
the Bank so notifies the Borrower, upon such date as shall be
specified in such notice, the Rate Period shall end and the
lesser of (i) the Base Rate or (ii) the Highest Lawful Rate
shall commence to apply in lieu of the Eurodollar Rate in
respect of such Eurodollar Rate Loan. At least five (5)
Business Days after such specified date, the Borrower shall
pay to the Bank (y) accrued and unpaid interest on such
Eurodollar Rate Loan at the Eurodollar Rate in effect at the
time of such notice to but not including such specified date
plus (z) such amount or amounts (to the extent that such
amount or amounts would not be usurious under applicable law)
as may be necessary to compensate the Bank for any direct or
indirect costs and losses incurred by it (to the extent that
such amounts have not been included in the Additional Costs in
calculating such Eurodollar Rate), but otherwise without
penalty. If notice has been given by the Bank pursuant to the
foregoing provisions of this Section , then, unless and until
the Bank notifies the Borrower that the circumstances giving
rise to such notice no longer apply, such Eurodollar Rate
shall not again apply to such Loan or any other Loan and the
obligation of the Bank to convert any Loan into, or to
continue any Eurodollar Rate Loan as, a Eurodollar Rate Loan
shall be suspended. Any such claim by the Bank for
compensation under clause (z) above shall be accompanied by a
certificate setting forth the computation upon which such
claim is based, and such certificate shall be conclusive and
binding for all purposes, absent manifest error.
(d) The Borrower will indemnify the Bank
against, and reimburse the Bank on demand for, any loss, cost
or expense incurred or sustained by the Bank (including,
without limitation, any loss or expense incurred by reason of
the liquidation or reemployment of deposits or other funds
acquired by the Bank to fund or maintain any Eurodollar Rate
Loan) as a result of (i) any Additional Costs incurred by the
Bank; (ii) any payment or repayment (whether authorized or
required hereunder or otherwise) of all or a portion of any
Eurodollar Rate Loan on a day other than the last day of a
Rate Period for such Loan; (iii) any payment or prepayment
(whether required hereunder or otherwise) of any Eurodollar
Rate Loan made after the delivery of a Notice of Borrowing or
a Notice of Rate Change/Continuation, as the case may be, but
before the applicable Borrowing Date or a
Conversion/Continuation Date, as the case may be, if such
payment or prepayment prevents the proposed borrowing from
becoming fully effective; or (iv) after receipt by the Bank of
a Notice of Borrowing or a Notice of Rate Change/Continuation,
as the case may be, the failure of any Eurodollar Rate Loan to
be made or effected by the Bank due to any condition precedent
to a borrowing not being satisfied by the Borrower or due to
any other action or inaction of the Borrower. The Bank shall
deliver to the Borrower a statement reasonably setting forth
the amount and manner of determining such loss, cost or
expense, which statement shall be conclusive and binding for
all purposes, absent manifest error.
(e) (i) If, after the date of this Agreement,
the Bank shall have determined that the adoption of any
applicable law, rule or regulation regarding capital adequacy,
or any change therein, 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 the Bank with any
request or directive regarding capital adequacy (whether or
not having the force of law) of any such authority, central
bank or comparable agency, has or would have the effect of
reducing the rate of return on the Bank's capital as a
consequence of its obligations hereunder to a level below that
which the Bank could have achieved but for such adoption,
change or compliance (taking into consideration the Bank's
policies with respect to capital adequacy) by an amount deemed
by the Bank to be material, then the Borrower shall pay to the
Bank such additional amount or amounts as will compensate the
Bank for such reduction.
(ii) A certificate of the Bank setting forth such
amount or amounts as shall be necessary to compensate the Bank
as specified in subparagraph (i) above shall be delivered as
soon as practicable to the Borrower and shall be conclusive
and binding, absent manifest error. The Borrower shall pay
the Bank the amount shown as due on any such certificate
within fifteen (15) days after the Bank delivers such
certificate. In preparing such certificate, the Bank may
employ such assumptions and allocations of costs and expenses
as it shall in good xxxxx xxxx reasonable and may use any
reasonable averaging and attribution method.
5. PREPAYMENTS AND OTHER PAYMENTS.
5.1. Required Prepayments.
(a) The Borrower agrees that, on each August 6
and February 6 during the term of the Loans, commencing on
August 6, 1993 and continuing until February 6, 1997, and on
each May 6, August 6, November 6, and February 6, commencing
on May 6, 1997 and continuing until the Revolving Maturity
Date, the Borrower shall make mandatory prepayments in an
amount equal to Adjusted Excess Cash Flow to the extent of
Adjusted Excess Cash Flow for the immediately preceding
Quarter-Annual Period, to be applied in the following order:
(i) to the outstanding principal balance of the Revolving
Credit Loans; and (ii) the balance, to the outstanding
principal balance of the Term Loan.
(b) The Borrower agrees that if at any time as a
result of the reduction of the Revolving Loan Commitment
pursuant to Section the aggregate principal amount of
Revolving Credit Loans outstanding exceeds the amount of the
Revolving Loan Commitment after giving effect to such
reduction, the Borrower shall make a prepayment of principal
in an amount at least equal to such excess.
(c) The Borrower agrees that if at any time it
or the Bank determines that: (i) the aggregate principal
amount of Loans outstanding and (ii) the face amount of
Facility Letters of Credit issued hereunder, exceed the
Commitment, the Borrower shall make a prepayment of principal
of the Loans in an amount at least equal to such excess. The
prepayment shall be applied to reduce the outstanding
principal amount of the Revolving Credit Loans.
(d) In the event that the Borrower consummates
the sale of the Land described in and pursuant to the terms of
the Phoenix Purchase Agreement to Phoenix Holdings, Ltd., the
Borrower shall pay an amount equal to the then outstanding
principal balance on the Loans out of the sale proceeds
resulting from the sale of such Land to the Bank for
application to the Loans in such manner as the Bank shall
determine.
5.2. Optional Prepayments. The Borrower shall
have the right at any time and from time to time to prepay any
of the Notes selected by it, in whole or in part, provided
that:
(a) each partial prepayment shall be in an
aggregate principal amount of at least $100,000.00 and if to
be applied to the Term Note, shall be applied to the principal
installments thereof in the inverse order of their due dates;
(b) the Borrower shall give the Bank prior
written notice of each prepayment proposed to be made pursuant
to this Section , specifying the principal amount of the Notes
to be prepaid, the prepayment date and the account of the
Borrower to be charged if such prepayment is to be so
effected. Notice of such prepayment having been given, the
principal amount of the Notes specified in such notice,
together with interest thereon to the date of prepayment,
shall become due and payable on such prepayment date; and
5.3. Prepayment of Eurodollar Rate Loans.
Anything herein to the contrary notwithstanding, the Borrower
may not pay or prepay any Eurodollar Rate Loan prior to the
end of the Rate Period applicable thereto, except upon payment
to the Bank of a breakage fee in an amount determined by the
Bank, in its sole discretion, based upon the costs incurred by
the Bank as a result of such payment or prepayment.
5.4. Place of Payment or Prepayment. All
payments and prepayments made in accordance with the
provisions of this Agreement or of the Notes or of the Letter
of Credit Reimbursement Agreements in respect of commitment
fees or of principal or interest on the Notes shall be made to
the Bank at its Domestic Lending Office no later than 11:00
a.m. (Houston time), in immediately available funds.
5.5. No Prepayment Premium or Penalty. Each
prepayment pursuant to Section or shall be without premium
or penalty.
5.6. No Reborrowing. The Borrower shall have no
right to reborrow any amount prepaid pursuant to
Sections 5.1(a), , and .
5.7. Taxes. All payments (whether of principal,
interest, reimbursements or otherwise) under this Agreement or
on the Notes or in respect of Facility Letter of Credit
Obligations shall be made by the Borrower without set-off or
counterclaim and shall be made free and clear of and without
deduction for any present or future tax, levy, impost or any
other charge, if any, of any nature whatsoever now or
hereafter imposed by any taxing authority. If the making of
such payments is prohibited by law, unless such a tax, levy,
impost or other charge is deducted or withheld therefrom, the
Borrower shall pay to the Bank, on the date of each such
payment, such additional amounts as may be necessary in order
that the net amounts received by the Bank after such deduction
or withholding shall equal the amounts which would have been
received if such deduction or withholding were not required.
5.8. Reduction or Termination of the Revolving
Loan Commitment. The Borrower may at any time or from time to
time reduce or terminate the Revolving Loan Commitment by
giving not less than five (5) full Business Days' prior
written notice to such effect to the Bank, provided that any
partial reduction shall be in the amount of $100,000.00 or a
multiple thereof. Any reduction in the Revolving Loan
Commitment shall be effective on the date specified in the
Borrower's notice with respect to such reduction. After each
such reduction, the commitment fee shall be calculated upon
the Revolving Loan Commitment as so reduced. The Revolving
Loan Commitment shall automatically terminate on the Revolving
Termination Date or in the event of acceleration of the
maturity date of the Revolving Note. Each reduction of the
Revolving Loan Commitment hereunder shall be irrevocable.
6. COMMITMENT FEE AND OTHER FEES.
6.1. Facility Fee. The Borrower agrees to pay to
the Bank a Facility Fee in the amount of one-half of one
percent (1/2%) of the sum of the Term Loan Commitment and the
Revolving Credit Commitment, such Facility Fee to be payable
in full on the Closing Date.
6.2. Commitment Fee. The Borrower agrees to pay
to the Bank a commitment fee computed on a daily basis of a
year of 365 or 366 days, as the case may be, from the date of
the first Revolving Credit Loan to, but not including,
December 20, 1996, at the rate of one-quarter of one percent
(1/4%) per annum on the daily average unused amount of the
Revolving Loan Commitment, and from December 20, 1996 to but
not including, the Revolving Termination Date, at the rate of
.375 percent (.375%) per annum on the daily average unused
amount of the Revolving Loan Commitment, such commitment fee
to be payable quarterly in arrears on the sixth (6th) day of
each May, August, November and February, commencing on May 6,
1992 and concluding on the Revolving Termination Date.
6.3. Facility Letter of Credit Fee. The Borrower
agrees to pay to the Bank a Facility Letter of Credit Fee as
set forth in Section .
6.4. Fees Not Interest; Nonpayment. The fees
described in this Agreement represent compensation for
services rendered and to be rendered separate and apart from
the lending of money or the provision of credit and do not
constitute compensation for the use, detention, or forbearance
of money, and the obligation of the Borrower to pay each fee
described herein shall be in addition to, and not in lieu of,
the obligation of the Borrower to pay interest, other fees
described in this Agreement, and expenses otherwise described
in this Agreement. Fees shall be payable when due in Dollars
and in immediately available funds. All fees, including,
without limitation, the commitment fee referred to in
Section , shall be non-refundable, and shall, to the fullest
extent permitted by law, bear interest, if not paid when due,
at a rate per annum equal to the lesser of (a) two percent
(2%) above the Base Rate or (b) the Highest Lawful Rate.
7. APPLICATION OF PROCEEDS. The Borrower
agrees that (i) the proceeds of the Term Loan shall be used to
acquire the Circle C Tract, and (ii) the proceeds of the
Revolving Credit Loans shall be used to pay Operating Expenses
of the Borrower; provided that none of the proceeds of the
Revolving Credit Loans shall be utilized by the Borrower to
make (x) principal and interest payments on the Term Loan;
(y) interest payments on the Revolving Credit Loans; and/or
(z) payments of any kind on the subordinated Debt described in
Section 11.2(f) of the Credit Agreement. Notwithstanding any
provision contained in the Credit Agreement, upon and after
December 12, 1996, the Revolving Loan capability may only be
utilized by the Borrower for the purpose of borrowing, in the
event that the closing of the Phoenix Purchase fails to occur,
an amount equal to the amount of the MUD Proceeds required to
be deposited into the registry of the court pursuant to
Section 6(e) of the Phoenix Purchase Agreement (as long as
capacity exists under the Revolving Loan Commitment to that
extent).
8. REPRESENTATIONS AND WARRANTIES. The
Borrower represents and warrants that:
8.1. Organization and Qualification. The
Borrower (a) is a corporation duly organized, validly
existing, and in good standing under the laws of its state of
incorporation; (b) has the corporate power to own its
properties and to carry on its business as now conducted; and
(c) is duly qualified as a foreign corporation to do business
and is in good standing in every jurisdiction where such
qualification is necessary.
8.2. Financial Statements. The Borrower has
furnished the Bank with an unaudited financial report of the
Borrower as of September 30, 1996, containing a balance sheet,
statements of income and stockholder's equity and a cash flow
statement, all in reasonable detail and certified by a
financial officer of the Borrower to have been prepared in
accordance with generally accepted accounting principles
consistently applied.
8.3. Litigation. There is no action or
proceeding pending or, to the knowledge of the Borrower,
threatened against the Borrower before any court,
administrative agency or arbitrator which might have a
Material Adverse Effect. There is no outstanding judgment,
order or decree affecting the Borrower before or by any
administrative or Governmental Authority.
8.4. Default. The Borrower is not in default
under or in violation of the provisions of any instrument
evidencing any Debt or of any agreement relating thereto or
any judgment, order, writ, injunction or decree of any court
or any order, regulation or demand of any administrative or
governmental instrumentality which default or violation might
have a Material Adverse Effect.
8.5. Title to Assets. The Borrower has good and
marketable title to its assets, subject to no Liens except
those permitted in Section .
8.6. Payment of Taxes. The Borrower has filed
all tax returns required to be filed and has paid all taxes
shown on said returns and all assessments which are due. The
Borrower is not aware of any pending investigation by any
taxing authority or of any claims by any governmental
authority for any unpaid taxes.
8.7. Conflicting or Adverse Agreements or
Restrictions. The Borrower is not a party to any contract or
agreement or subject to any restriction which would have a
Material Adverse Effect. Neither the execution and delivery
of the Loan Documents nor the consummation of the transactions
contemplated thereby nor fulfillment of and compliance with
the respective terms, conditions and provisions thereof will
conflict with or result in a breach of any of the terms,
conditions or provisions of, or constitute a default under, or
result in any violation of, or result in the creation or
imposition of any Lien on any of the property of any Party
pursuant to (a) the charter or bylaws applicable to each such
Party; (b) any law or any regulation of any administrative or
governmental instrumentality; (c) any order, writ, injunction
or decree of any court; or (d) the terms, conditions or
provisions of any agreement or instrument to which any such
Party is a party or by which it is bound or to which it is
subject.
8.8. Authorization, Validity, Etc. The Parties
have the power and authority to make, execute, deliver and
carry out the Loan Documents and the transactions contemplated
therein and to perform their respective obligations thereunder
and all such action has been duly authorized by all necessary
proceedings on their part. The Loan Documents have been duly
and validly executed and delivered by the Parties and
constitute valid and legally binding agreements of the Parties
enforceable in accordance with their respective terms, except
as limited by Debtor Laws.
8.9. Investment Company Act Not Applicable. The
Borrower is not an "investment company", or a company
"controlled" by an "investment company", within the meaning of
the Investment Company Act of 1940, as amended.
8.10. Public Utility Holding Company Act Not
Applicable. The Borrower is not a "holding company", or a
"subsidiary company" of a "holding company", or an "affiliate"
of a "holding company", or an affiliate of a "subsidiary
company" of a "holding company", or a "public utility", as
such terms are defined in the Public Utility Holding Company
Act of 1935, as amended.
8.11. Regulations G, T, U and X. None of the
proceeds of any Loan will be used for the purpose of
purchasing or carrying, directly or indirectly, any "margin
stock" within the meaning of Regulation U of the Board of
Governors of the Federal Reserve System ("margin stock"), or
to extend credit to others for the purpose of purchasing or
carrying any margin stock, or for any other purpose which
would constitute this transaction a "purpose credit" within
the meaning of said Regulation U, as now in effect or as the
same may hereafter be in effect. The Borrower will not take
or permit any action which would involve the Bank in a
violation of Regulation G, Regulation T, Regulation U,
Regulation X or any other regulation of the Board of Governors
of the Federal Reserve System or a violation of the Securities
Exchange Act of 1934, in each case as now or hereafter in
effect.
8.12. ERISA. The Borrower does not maintain and
is not required to contribute to any Plan. The Borrower does
not currently contemplate that it will establish or contribute
to any Plan.
8.13. No Financing of Corporate Takeovers. None
of the proceeds of any Loan will be used to acquire any
security in any transaction which is subject to Section 13 or
14 of the Securities Exchange Act of 1934, as amended.
8.14. Franchises, Co-licenses, Etc. The Borrower
owns or has obtained all the material governmental permits,
certificates of authority, leases, patents, trademarks,
service marks, trade names, copyrights, franchises and
licenses, and rights with respect thereto, required, advisable
or necessary in connection with the conduct of its business as
presently conducted or as proposed to be conducted.
8.15. Line of Business. The nature of the
Borrower's line of business is real estate development,
marketing and sales related thereto, and the operation of
clubs, swim centers and other facilities related thereto.
8.16. Environmental Matters. Except as disclosed
to the Bank in writing: (i) all facilities and property owned
or leased by the Borrower have been and continue to be, owned
or leased and operated by the Borrower in material compliance
with all Environmental Laws; (ii) there has not been any
Release of Hazardous Materials at, on or under any property
now or previously owned or leased by the Borrower (A) in
quantities that would be required to be reported under any
Environmental Law, (B) that required, or may reasonably be
expected to require, the Borrower to expend funds on
remediation or clean-up activities pursuant to any
Environmental Law, or (C) that, singly or in the aggregate,
have, or may reasonably be expected to have, a Material
Adverse Effect; (iii) the Borrower has been issued and is in
material compliance with all permits, certificates, approvals,
orders, licenses and other authorizations relating to
environmental matters necessary for its business; and
(iv) there are not and in the past there have been none of the
following on or in any of the assets of the Borrower or any
property now or previously owned or leased by it: (A) any
Hazardous Materials, (B) any generation, treatment, recycling,
storage or disposal of any Hazardous Materials, (C) any
underground storage tanks or surface impoundments, (D) any
asbestos-containing material, or (E) any polychlorinated
biphenyls (PCBs).
9. CONDITIONS. The obligation of the Bank to
make each Loan or to continue any Loan as, or to convert any
Loan into, a Eurodollar Rate Loan, or to issue any Facility
Letter of Credit, is subject to the following conditions:
9.1. Representations True and No Defaults.
(a) The representations and warranties contained in Section
shall be true and correct on and as of the particular
Borrowing Date or the applicable Conversion/Continuation Date,
as the case may be, as though made on and as of such date;
(b) the Borrower shall not be in default in the due
performance of any covenant on its part contained in this
Agreement; (c) no material adverse change shall have occurred
with respect to the business, properties or condition
(financial or otherwise) of the Borrower since the Closing
Date; and (d) no Event of Default or Default shall have
occurred and be continuing.
9.2. Discharge of Debt. On the Closing Date, the
Borrower shall have delivered to the Bank satisfactory
evidence of the payment in full and discharge of all Debt in
excess of that permitted in Section .
9.3. Governmental Approvals. Prior to the
Closing Date, the Borrower shall have obtained all orders,
approvals or consents of all public regulatory bodies required
for the making and carrying out of this Agreement, the making
of the Loans pursuant hereto and the issuance of the Notes to
evidence such Loans.
9.4. Compliance With Law. The business and
operations of the Borrower as conducted at all times relevant
to the transactions contemplated by this Agreement to and
including the close of business on the Closing Date shall have
been and shall be in compliance with all applicable State and
Federal laws, regulations and orders affecting the Borrower
and its business and operations.
9.5. Officer's Certificate and Other Documents.
On each Borrowing Date, the Bank shall have received (i) an
Officer's Certificate dated the particular Borrowing Date to
the effects set forth in Sections , and ; (ii) a Notice of
Revolving Loan Borrowing or a Notice of Term Loan Borrowing,
as the case may be, in the form attached hereto as
Exhibit "C"; and (iii) such other documents and certificates
relating to the transactions herein contemplated as the Bank
may reasonably request.
9.6. Conversion/Continuation Documents. On the
applicable Conversion/Continuation Date, the Bank shall have
received (i) an Officer's Certificate dated the applicable
Conversion/Continuation Date to the effects set forth in
Section (a)(ii); (ii) a Notice of Rate Change/Continuation in
the form attached hereto as Exhibit "D"; and (iii) such other
documents and certificates relating to the transactions herein
contemplated as the Bank may reasonably request.
9.7. Required Documents and Certificates. On the
Second Closing Date, the Bank shall have received the
following, in each case in form, scope and substance
satisfactory to the Bank: (i) the Notes duly executed by the
Borrower; (ii) an Officer's Certificate in the form acceptable
to the Bank of each Party which is a business entity dated as
of the Second Closing Date to which are attached true and
correct copies of the Articles of Incorporation and Bylaws of
such Party and corporate resolutions duly adopted by the Board
of Directors of each Party which is a business entity
authorizing the transactions contemplated by the Loan
Documents; (iii) a certificate from the Secretary of State and
other appropriate public officials as to the continued
existence and good standing of each Party which is a business
entity; (iv) a certificate from the appropriate public
official of each state in which each Party which is a business
entity is authorized and qualified to do business as to the
due qualification and good standing of each Party which is a
business entity; (v) the Guaranty Agreements executed by the
appropriate parties; (vi) legal opinions in form, substance
and scope satisfactory to the Bank from various counsel to the
Borrower and the Guarantor; (vii) the Amended and Restated
Intercreditor and Subordination Agreement, executed by the
Borrower, the Guarantor, FM Properties, and the Bank; and
(viii) the FTX Security Agreement, all of which shall be
satisfactory to the Bank.
10. AFFIRMATIVE COVENANTS. The Borrower
covenants and agrees that, so long as the Borrower may borrow
hereunder and until payment in full of the Notes, the Borrower
will:
10.1. Financial Statements and Information.
Deliver to the Bank in duplicate:
(a) as soon as available, and in any event
within ninety (90) days after the end of each fiscal year of
the Borrower, a copy of the unaudited financial report of the
Borrower as of the end of such fiscal year and for the period
then ended, containing a balance sheet, statements of income
and stockholders' equity, and a cash flow statement, all in
reasonable detail and certified by a financial officer of the
Borrower, to have been prepared in accordance with generally
accepted accounting principles consistently applied, except as
may be explained in such certificate; provided that, in the
event that Borrower prepares an annual audited report of the
Borrower for such fiscal year containing a balance sheet,
statements of income and stockholders' equity, Borrower shall
supply such annual audited report to the Bank as soon as
available. The Borrower will obtain from such accountants and
deliver to the Bank at the time said audited financial
statements are delivered the written statement of the
accountants that in making the examination necessary to said
certification they have obtained no knowledge of any Event of
Default or Default, or if such accountants shall have obtained
knowledge of any such Event of Default or Default, they shall
state the nature and period of existence thereof in such
statement; provided that such accountants shall not be liable
directly or indirectly to the Bank for failure to obtain
knowledge of any such Event of Default or Default;
(b) as soon as available, and in any event
within forty-five (45) days after the end of each quarterly
accounting period in each fiscal year of the Borrower
(including the fourth quarter), an unaudited financial report
of the Borrower as at the end of such quarter and for the
period then ended, containing a balance sheet, statements of
income and stockholder's equity and a cash flow statement, all
in reasonable detail and certified by a financial officer of
the Borrower to have been prepared in accordance with
generally accepted accounting principles consistently applied,
except as may be explained in such certificate;
(c) copies of all statements and reports sent to
stockholders of the Borrower or filed with the Securities and
Exchange Commission;
(d) copies of all financial and other
information supplied by the Borrower to any Guarantor; and
(e) such additional financial or other
information as the Bank may reasonably request.
Together with each delivery of financial statements required
by clauses (a) and (b) above, the Borrower will deliver to the
Bank an Officer's Certificate in a form satisfactory to the
Bank stating that there exists no Event of Default or Default,
or, if any such Event of Default or Default exists, stating
the nature thereof, the period of existence thereof and what
action the Borrower has taken or proposes to take with respect
thereto. The Bank is authorized to deliver a copy of any
financial statement delivered to it to any regulatory body
having jurisdiction over it.
10.2. Lease Schedule. Deliver to the Bank,
together with each delivery of financial statements under
Section , a current, complete schedule of all agreements to
rent or lease any property (personal, real or mixed) to which
the Borrower is a party lessee, showing the total amounts
payable under each such agreement, the amounts and due dates
of payments thereunder and containing a description of the
rented or leased property, and all other information the Bank
may request, all in a form satisfactory to the Bank.
10.3. Books and Records. Maintain proper books of
record and account in accordance with sound accounting
practices in which true, full and correct entries will be made
of all its dealings and business affairs.
10.4. Insurance. Maintain insurance with
financially sound, responsible and reputable companies in such
types and amounts and against such casualties, risks and
contingencies as is customarily carried by owners of similar
businesses and properties, and furnish to the Bank, together
with each delivery of financial statements under Section , an
Officer's Certificate containing full information as to the
insurance carried.
10.5. Maintenance of Property. Cause its property
to be maintained, preserved, protected and kept in good
repair, working order and condition so that the business
carried on in connection therewith may be conducted properly
and efficiently.
10.6. Inspection of Property and Records. Permit
any person designated by the Bank in writing, at the Bank's
expense, to visit and inspect any of the properties, books and
financial records of the Borrower and discuss its affairs and
finances with its principal officers, all at such times as the
Bank may reasonably request.
10.7. Existence, Laws, Obligations. Maintain its
corporate existence, comply with all statutes and governmental
regulations and pay all taxes, assessments, governmental
charges, claims for labor, supplies, rent and other
obligations which if unpaid might become a Lien against the
property of the Borrower, except liabilities being contested
in good faith.
10.8. Notice of Certain Matters. Notify the Bank
immediately upon acquiring knowledge of the occurrence of any
of the following events: (a) the institution or threatened
institution of any lawsuit or administrative proceeding
affecting the Borrower; (b) the occurrence of any material
adverse change in the assets, liabilities, financial
condition, business or affairs of the Borrower; or (c) the
occurrence of any Event of Default or any Default.
10.9. ERISA. In the event that the Borrower
establishes a Plan or Plans, at all times:
(a) Maintain and keep in full force and effect
each Plan;
(b) Make contributions to each Plan in a timely
manner and in an amount sufficient to comply with the minimum
funding standards requirements of ERISA;
(c) Comply with all applicable provisions of
ERISA;
(d) File all reports required by ERISA and the
Code to be filed with respect to each Plan;
(e) Meet all requirements with respect to
funding the Plans imposed by ERISA or the Code;
(f) Insure that the value of the Plans' benefits
guaranteed under Title IV of ERISA on the date hereof does not
exceed the value of such Plans' assets allocable to such
benefits at any time during the term of the Loan;
(g) Immediately upon acquiring knowledge of any
"reportable event" or of any "prohibited transaction" (as such
terms are defined in the Code) in connection with any Plan,
furnish the Bank with a statement executed by the president or
chief financial officer of the Borrower setting forth the
details thereof and the action which the Borrower proposes to
take with respect thereto and, when known, any action taken by
the Internal Revenue Service with respect thereto;
(h) Notify the Bank promptly upon receipt by the
Borrower of any notice of the institution of any proceeding or
other action which may result in the termination of any Plan
and furnish to the Bank copies of such notice;
(i) Acquire and maintain in amounts satisfactory
to the Bank from either the Pension Benefit Guaranty
Corporation or authorized private insurers, when available,
the contingent employer liability coverage insurance required
under ERISA;
(j) Furnish the Bank with copies of the annual
report for each Plan filed with the Internal Revenue Service
not later than ten (10) days after such report has been filed;
and
(k) Furnish the Bank with copies of any request
for waiver of the funding standards or extension of the
amortization periods required by Sections 303 and 304 of ERISA
or Section 412 of the Code promptly after the request is
submitted to the Secretary of the Treasury, the Department of
Labor or the Internal Revenue Service, as the case may be.
10.10. Compliance with Environmental Laws. At all
times:
(a) use and operate all of its facilities and
properties in material compliance with all Environmental Laws,
keep all necessary permits, approvals, orders, certificates,
licenses and other authorizations relating to environmental
matters in effect and remain in material compliance therewith,
handle all Hazardous Materials in material compliance with all
applicable Environmental Laws and dispose of all Hazardous
Materials generated by the Borrower or at any property owned
or leased by it at facilities or with carriers that maintain
valid permits, approvals, certificates, licenses or other
authorizations for such disposal under applicable
Environmental Laws;
(b) promptly notify the Bank and provide copies
upon receipt of all written claims, complaints, notices or
inquiries relating to the condition of the facilities and
properties of the Borrower or its compliance with
Environmental Laws; and
(c) provide such information and certifications
which the Bank may reasonably request from time to time to
evidence compliance with this Section 10.10.
10.11. Settlement Statements. Deliver to the Bank,
within ten (10) days of any closing of the Phoenix Purchase, a
copy of the settlement statement or other closing statement
executed by the Borrower and the purchaser and showing the
purchase price paid for the real property purchased in the
Phoenix Purchase.
10.12. Payment Calculations. Deliver to the Bank
on each January 15, April 15, July 15 and October 15 during
the terms of the Loans, commencing on July 15, 1995, together
with the prepayment on the Loans required pursuant to
Subsection 5.1(a) of the Credit Agreement, financial
information sufficient to show the Borrower's calculation of
Excess Cash Flow and Adjusted Excess Cash Flow for the
immediately preceding Quarter-Annual Period.
11. NEGATIVE COVENANTS. So long as the Borrower
may borrow hereunder and until payment in full of the Notes,
except with the written consent of the Bank:
11.1. Mortgages, Etc. The Borrower will not
create or permit to exist any Lien (including the charge upon
assets purchased under a conditional sales agreement, purchase
money mortgage, security agreement or other title retention
agreement) upon any of its assets, whether now owned or
hereafter acquired, or assign or otherwise convey any right to
receive income, except:
(a) Liens for taxes not yet due or which are
being contested in good faith by appropriate proceedings;
(b) Other Liens incidental to the conduct of its
business or the ownership of its assets which were not
incurred in connection with the borrowing of money or the
obtaining of advances or credit, and which do not in the
aggregate materially detract from the value of such assets or
materially impair the use thereof in the operation of such
business; and
(c) Liens held by Freeport-McMoRan Inc. and FM
Properties on real and personal property located in Xxxxxx
County, Texas, and Xxxx County, Texas identified to the Bank
by the Borrower as the property previously owned by Circle C
Development Joint Venture (the "Circle C Tract").
(d) [intentionally omitted]
11.2. Debt. The Borrower will not incur or permit
to exist any Funded Debt or Current Debt, except:
(a) Debt evidenced by the Notes and Facility
Letter of Credit Obligations;
(b) Endorsements in the ordinary course of
business of negotiable instruments in the course of
collection;
(c) Debt of the Borrower existing on the Closing
Date (and disclosed to the Bank), which is secured by Liens
permitted by the provisions of Section ;
(d) [intentionally omitted]
(e) [intentionally omitted]
(f) Secured Debt of the Borrower owed to FM
Properties as evidenced by that certain Revolving Promissory
Note in the original principal amount of $10,000,000.00, dated
July 17, 1995 (which principal amount may be increased to
$12,000,000.00), subordinated to the Loans, the Reimbursement
Obligations, and the existence of any Commitment, accruing
interest at a rate acceptable to the Bank, and upon such terms
and provisions as have been approved by the Bank, including
without limitation, provisions to the effect that (i) no
payment of principal or interest may be made upon such secured
Debt in the event that the Borrower is in default under the
Credit Agreement; (ii) no prepayment or accelerated payments
of principal may be made on such secured Debt; (iii) no
payment on such secured Debt shall be paid at final maturity
(whether or not such final maturity is established by an
instrument renewing or extending such Debt) until the Loans,
the Reimbursement Obligations and all of the Borrower's
obligations under the Credit Agreement have been paid in full
(whether or not such Loans, Reimbursement Obligations or other
obligations have been at any time renewed and extended by the
Bank) and any Commitment terminated; (iv) Revolving Credit
Loan proceeds shall not be used to make any payment of
principal or interest on such secured Debt; and (v) the
secured Debt shall amortize beginning September 30, 1995, with
payments equal to the lesser of Excess Cash Flow (to the
extent available) and twelve and one-half percent (12 1/2
percent) of the outstanding principal balance of such secured
Debt being made on each January 15, April 15, July 15, and
October 15 during the term of such secured Debt; (vi) the
maturity date of such secured Debt shall be February 6, 1997;
and (vii) Borrower may make interest or principal payments on
such secured Debt only to the extent that Excess Cash Flow is
available to make such payment, and to the extent that Excess
Cash Flow is not available to make a particular interest
and/or principal payment, then such interest or principal
shall not be paid but shall be added to the next regularly
scheduled interest and/or principal payment, as applicable,
and such inability to make any such payment shall not
constitute a default or event of default under the loan
documents relating to such secured Debt until the Loans, the
Reimbursement Obligations, and all of the Borrower's
obligations have been paid in full under the Credit Agreement
and the Commitment terminated; and
(g) Debt of the Borrower consisting of a
borrowing of the MUD Proceeds out of escrow or consisting of a
borrowing from FM Properties in an amount equal to the amount
of MUD Proceeds borrowed by FM Properties.
11.3. Loans, Advances and Investments. The
Borrower will not make or have outstanding any loan or advance
to, or own or acquire any stock or securities of or equity
interest in, any Person, except:
(a) (i) readily marketable securities issued or
fully guaranteed by the United States of America or commercial
paper rated "Prime 1" by Xxxxx'x Investors Service, Inc. or
A-1 by Standard and Poor's Corporation with maturities of not
more than one hundred eighty (180) days from the date of
issue; (ii) certificates of deposit or repurchase contracts
with financial institutions acceptable to the Bank on terms
satisfactory to the Bank, all of the foregoing not having a
maturity of more than one (1) year from the date of issuance
thereof; and (iii) readily marketable securities received in
settlement of liabilities created in the ordinary course of
business; and
(b) travel advances in the ordinary course of
business to officers and employees.
11.4. Merger, Consolidation, Etc. (a) The
Borrower will not merge or consolidate with any other Person
or sell, lease, transfer or otherwise dispose of (whether in
one transaction or a series of transactions, or whether as a
result of foreclosure of the liens described in Section
11.1(c) hereof or pursuant to the Option Agreement) all or a
substantial part of its assets or acquire (whether in one
transaction or a series of transactions) all or a substantial
part of the assets of any Person; provided, however that (i)
so long as the Borrower complies with the provisions of
Subsection 5.1(d) of the Credit Agreement, the Borrower may
sell all commercial properties included in the Circle C Tract
in Xxxxxx County, Texas owned by the Borrower, to Phoenix
Holdings, Ltd., pursuant to the Phoenix Purchase Agreement;
and (ii) the Borrower may transfer all commercial properties
owned by the Borrower to, merge into, or consolidate with,
(A) FM Properties, (B) a wholly-owned subsidiary of FM
Properties, (C) a new entity owned in part by FM Properties,
Inc. and in part by FM Properties, or (D) a new entity
acceptable to the Bank in its sole discretion (the party
described in (A), (B), (C), or (D) immediately foregoing,
except for a party that purchases stock in the Borrower, the
"Transactional Party"), so long as (X) the Transactional Party
(if other than FM Properties) owns no assets other than such
commercial properties, and (Y) the Transactional Party
(including FM Properties, if FM Properties is the
Transactional Party) assumes payment of the Loans, the Letters
of Credit Reimbursement Obligations and all other obligations
of the Borrower under the Loan Documents, upon such terms and
conditions as are acceptable to the Bank, including without
limitation, the execution of an assumption agreement by the
Transactional Party in a form acceptable to the Bank, delivery
of legal opinions in form, substance and scope satisfactory to
the Bank from various counsel to the Transactional Party and
the Guarantor, and delivery of an officer's certificate with
such organizational information and representations relating
thereto as is acceptable to the Bank and evidencing
resolutions or consents from the governing body of the entity
or other appropriate Person; and (a) shares of stock of the
Borrower shall be owned exclusively by one or more of the
following: (i) the Guarantor; or (ii) any parent corporation
of, sister corporation of, or subsidiary of, the Guarantor;
provided that shares of stock of the Borrower may be owned by
other Persons, with the prior written consent of the Bank
which the Bank shall not unreasonably withhold.
11.5. Supply and Purchase Contracts. The Borrower
will not enter into or be a party to any contract for the
purchase of materials, supplies or other property if such
contract requires that payment for such materials, supplies or
other property shall be made regardless of whether or not
delivery is ever made or tendered of such materials, supplies
and other property.
11.6. Discount or Sale of Receivables. The
Borrower will not discount or sell with recourse, or sell
for less than the face value thereof, any of its notes
receivable, receivables under leases or other accounts
receivable.
11.7. Change in Accounting Method. The Borrower
will not make any change in the method of computing
depreciation for either tax or book purposes or any other
material change in accounting method without the Bank's
prior written approval.
11.8. Sale of Inventory. The Borrower will not
make any sale, lease or other disposition of inventory
except in a prudent manner, based upon the prevailing fair
market value of the inventory, and on terms substantially
similar to those which would be involved in a third-party,
arms-length transaction.
11.9. Securities Credit Regulations. The
Borrower will not take or permit any action which might
cause the Loans or the Facility Letter of Credit Obligations
or this Agreement to violate Regulation G, Regulation T,
Regulation U, Regulation X or any other regulation of the
Board of Governors of the Federal Reserve System or a
violation of the Securities Exchange Act of 1934, in each
case as now or hereafter in effect.
11.10. Leases. The Borrower will not be a party
to any lease of real property with a value in excess of
$2,500,000.00, except upon the prior written consent of the
Bank.
11.11. Nature of Business; Management. The
Borrower will not change its line of business or enter into
any business which is substantially different from the
business in which it is presently engaged or permit any
material change in its management.
11.12. Transactions with Related Parties. The
Borrower will not enter into any transaction or agreement
with any officer, director or holder of any outstanding
capital stock of the Borrower (or any Affiliate of any such
Person) or any Person which has an option to purchase
outstanding shares of the Borrower, unless the same is upon
terms substantially similar to those obtainable from wholly
unrelated sources. The Bank hereby consents to Borrower's
execution of the Option Agreement; provided, however that
the Borrower shall not transfer the Circle C Tract to FM
Properties, pursuant to the Option Agreement, without the
Bank's prior written consent which may be given or withheld
at the Bank's sole discretion, except in compliance with
Section 11.4 of the Credit Agreement. The Bank hereby
consents to the Borrower's entering into a loan transaction
as borrower with FM Properties to the extent permitted under
Section 11.2(f) of the Credit Agreement.
11.13. Contingent Liabilities. The Borrower will
not guarantee directly or indirectly the performance or
payment of, or purchase or agree to purchase, or assume or
contingently agree to become or be secondarily liable in
respect of, any obligation or liability of any other Person
except as permitted by Section .
11.14. Hazardous Materials. The Borrower will
not (a) cause or permit any Hazardous Materials to be
placed, held, used, located, or disposed of on, under or at
any of the Borrower's property or any part thereof by any
Person in a manner which could reasonably be expected to
have a Material Adverse Effect; (b) cause or permit any part
of any of the Borrower's property to be used as a
manufacturing, storage or dump site for Hazardous Materials,
where such action could reasonably be expected to have a
Material Adverse Effect; or (c) cause or suffer any Liens to
be recorded against any of the Borrower's property as a
consequence of, or in any way related to, the presence,
remediation, or disposal of Hazardous Materials in or about
any of the Borrower's property, including any so-called
state, federal or local "superfund" lien relating to such
matters.
11.15. Subordinated Debt. The Borrower shall not
make any payment of principal or interest on the secured
subordinated Debt permitted under Section 11.2(f) of the
Credit Agreement, except as permitted under the
subordination provisions contained in the agreements
establishing or evidencing such secured Debt and approved by
the Bank. The Borrower shall not amend or modify any
provisions of any instrument evidencing the subordinated
Debt described in the two preceding sentences, without the
prior written consent of the Bank.
11.16. Phoenix Purchase Agreement. The Phoenix
Purchase Agreement shall not be amended, without the prior
written consent of the Bank (which consent shall not be
unreasonably withheld), to provide for a closing date of the
Phoenix Purchase that is later than the Maturity Date or to
provide for consideration for the Phoenix Purchase the net
proceeds of which would be insufficient to repay the Loans
in full.
12. EVENTS OF DEFAULT; REMEDIES. If any of
the following events shall occur, then the Bank may (i) by
notice to the Borrower, declare the Commitment of the Bank
and the obligation of the Bank to make Loans hereunder to be
terminated, whereupon the same shall forthwith terminate,
and/or (ii) declare the Notes and all interest accrued and
unpaid thereon, and all other amounts payable under the
Notes and this Agreement, to be forthwith due and payable,
whereupon the Notes, all such interest and all such other
amounts, shall become and be forthwith due and payable
without presentment, demand, protest, or further notice of
any kind (including, without limitation, notice of default,
notice of intent to accelerate and notice of acceleration),
all of which are hereby expressly waived by the Borrower;
provided, however, that with respect to any Event of Default
described in Section hereof, (A) the Commitment of the Bank
and the obligation of the Bank to make Loans hereunder shall
automatically be terminated and (B) the entire unpaid
principal amount of the Notes, all interest accrued and
unpaid thereon, and all such other amounts payable under the
Notes and this Agreement, shall automatically become
immediately due and payable, without presentment, demand,
protest, or any notice of any kind (including, without
limitation, notice of default, notice of intent to
accelerate and notice of acceleration), all of which are
hereby expressly waived by the Borrower.
12.1. Failure to Pay Principal. The Borrower
does not pay, repay or prepay any principal of any Note
within three (3) days after due; or
12.2. Failure to Pay Interest. The Borrower
does not pay interest on any Note within five (5) days after
due; or
12.3. Failure to Pay Commitment Fee or Other
Amounts. The Borrower does not pay any commitment fee, the
Facility Letter of Credit Fee, the Facility Fee, or any
other obligation or amount payable under this Agreement or
the Notes or any Letter of Credit Reimbursement Agreement
when due; or
12.4. Failure to Pay Other Debt. The Borrower
does not pay principal or interest on any other Debt when
due, except with respect to trade debt in an amount less
than $100,000.00 as to which the Borrower has a good faith
dispute (the "Excepted Trade Debt"); provided, however, that
with respect to trade debt in excess of $100,000.00, the
Borrower may, with the prior written consent of the Bank
dispute in good faith such trade debt without such failure
to pay such trade debt constituting an Event of Default
hereunder; or the holder of such other Debt (other than the
Excepted Trade Debt) declares, or may declare, such Debt due
prior to its stated maturity because of the Borrower's
default thereunder; or
12.5. Misrepresentation or Breach of Warranty.
Any representation or warranty made by the Borrower herein
or otherwise furnished to the Bank in connection with this
Agreement shall be incorrect, false or misleading in any
material respect when made; or
12.6. Violation of Negative Covenants. The
Borrower violates any covenant, agreement or condition
contained in Section ; or
12.7. Violation of Other Covenants, Etc. The
Borrower violates any other covenant, agreement or condition
contained herein (other than the covenants, agreements and
conditions set forth or described in Sections , , , and
above) and such violation shall not have been remedied
within thirty (30) days after the occurrence thereof except
that (i) with respect to Defaults under covenants relating
to environmental matters, such a Default shall not be an
Event of Default unless the Default is not susceptible of
cure or unless the Borrower ceases diligently to cure a
Default which is susceptible to being cured; and (ii) with
respect to Defaults under covenants relating to compliance
with governmental requirements relating to development, such
a Default shall not be an Event of Default unless Borrower
ceases diligently to cure such Default or such Default shall
not have been remedied within ninety (90) days after the
occurrence thereof; or
12.8. Bankruptcy and Other Matters. The
Borrower (i) makes an assignment for the benefit of
creditors; or (ii) admits in writing its inability to pay
its debts generally as they become due; or (iii) generally
fails to pay its debts as they become due; or (iv) files a
petition or answer seeking for itself, or consenting to or
acquiescing in, any reorganization, arrangement,
composition, readjustment, liquidation, dissolution, or
similar relief under any applicable Debtor Law (including,
without limitation, the Federal Bankruptcy Code); or
(v) there is appointed a receiver, custodian, liquidator,
fiscal agent, or trustee of the Borrower or of the whole or
any substantial part of its assets; or (vi) any court enters
an order, judgment or decree approving a petition filed
against the Borrower seeking reorganization, arrangement,
composition, readjustment, liquidation, dissolution, or
similar relief under any Debtor Law and either such order,
decree or judgment so filed against it is not dismissed or
stayed (unless and until such stay is no longer in effect)
within thirty (30) days of entry thereof or an order for
relief is entered pursuant to any such law; or
12.9. Dissolution. Any order is entered in any
proceeding against the Borrower decreeing the dissolution,
liquidation, winding-up or split-up of the Borrower, and
such order remains in effect for thirty (30) days; or
12.10. Undischarged Judgment. Final judgment, or
judgments in the aggregate, for the payment of money in
excess of $20,000.00 shall be rendered against the Borrower
and the same shall remain undischarged for a period of
thirty (30) days during which execution shall not be
effectively stayed; or
12.11. Security Documents. Any Party violates
any covenant, agreement or condition contained in the
Security Documents or any default or event of default
otherwise occurs thereunder; or
12.12. Failure to Maintain Guaranty. Any
Guaranty Agreement by any Guarantor is or becomes, or the
Borrower or any Guarantor claims that any Guaranty Agreement
is unenforceable or ineffective, or any Guarantor defaults
under any such Guaranty Agreement; or
12.13. Environmental Matters. The occurrence of
any of the following events which, in the sole opinion of
the Bank, could result in liability to the Borrower under
any Environmental Law or the creation of a Lien on any
property of the Borrower in favor of any governmental
authority or any other Person for any liability under any
Environmental Law or for damages arising from costs incurred
by such Person in response to a Release or threatened
Release of Hazardous Materials into the environment: (i) the
Release of Hazardous Materials at, upon, under or within the
property owned or leased by the Borrower or any contiguous
property; (ii) the receipt by the Borrower of any summons,
claim, complaint, judgment, order or similar notice that it
is not in compliance with or that any governmental authority
is investigating its compliance with any Environmental Law;
(iii) the receipt by the Borrower of any notice or claim to
the effect that it is or may be liable for the Release or
threatened Release of Hazardous Materials into the
environment; or (iv) any governmental authority incurs costs
or expenses in response to the Release of any Hazardous
Material which affects in any way the properties of the
Borrower.
12.14. Other Remedies. In addition to and
cumulative of any rights or remedies expressly provided for
in this Section , if any one or more Events of Default shall
have occurred, the Bank may proceed to protect and enforce
its rights hereunder by any appropriate proceedings. The
Bank may also proceed either by the specific performance of
any covenant or agreement contained in this Agreement or the
other Loan Documents or by enforcing the payment of the
Notes or by enforcing any other legal or equitable right
provided under this Agreement or the other Loan Documents or
otherwise existing under any law in favor of the holder of
the Notes.
12.15. Remedies Cumulative. No remedy, right or
power conferred upon the Bank is intended to be exclusive of
any other remedy, right or power given hereunder or now or
hereafter existing at law, in equity, or otherwise, and all
such remedies, rights and powers shall be cumulative.
13. MISCELLANEOUS.
13.1. Representation by the Bank. The Bank
represents that it is its present intention, as of the date
of its acquisition of the Notes, to acquire the Notes for
its account or for the account of its Affiliates, and not
with a view to the distribution or sale thereof, and,
subject to any applicable laws, the disposition of the
Bank's property shall at all times be within its control.
The Notes have not been registered under the Securities Act
of 1933, as amended (the "Securities Act"), and may not be
transferred, sold or otherwise disposed of except (a) in a
registered offering under the Securities Act; (b) pursuant
to an exemption from the registration provisions of the
Securities Act; or (c) if the Securities Act shall not apply
to the Notes or the transactions contemplated by the Loan
Documents. Nothing in this Section shall affect the
characterization of the Loans and the transactions
contemplated hereunder as commercial lending transactions.
13.2. Amendments, Waivers, Etc. No amendment or
waiver of any provision of any Loan Document, nor consent to
any departure by the Borrower therefrom, shall in any event
be effective unless the same shall be writing and signed by
the Borrower and the Bank, and then such waiver or consent
shall be effective only in the specific instance and for the
specific purpose for which given. No failure or delay on
the part of the Bank in exercising any power or right
hereunder shall operate as a waiver thereof, nor shall any
single or partial exercise of any such right or power, or
any abandonment or discontinuance of steps to enforce such a
right or power, preclude any other or further exercise
thereof or the exercise of any other right or power. No
course of dealing between the Borrower and the Bank shall
operate as a waiver of any right of the Bank. No
modification or waiver of any provision of this Agreement,
the Notes or any other Loan Document nor consent to any
departure by the Borrower therefrom shall in any event be
effective unless the same shall be in writing, and then such
waiver or consent shall be effective only in the specific
instance and for the purpose for which given. No notice to
or demand on the Borrower in any case shall entitle the
Borrower to any other or further notice or demand in similar
or other circumstances.
13.3. [intentionally omitted]
13.4. Reimbursement of Expenses. Any provision
hereof to the contrary notwithstanding, and whether or not
the transactions contemplated by this Agreement shall be
consummated, the Borrower agrees to reimburse the Bank for
its reasonable out-of-pocket expenses, including the
reasonable fees and expenses of counsel to the Bank, in
connection with such transactions, or any of them, or
otherwise in connection with this Agreement or any other
Loan Document, including the negotiation, preparation,
execution, administration, modification and enforcement of
this Agreement or any other Loan Document and all fees,
including the reasonable fees and expenses of counsel to the
Bank, costs and expenses of the Bank in connection with due
diligence, transportation, computer, duplication, insurance
and consultants. The Borrower agrees to pay any and all
stamp and other taxes which may be payable or determined to
be payable in connection with the execution and delivery of
this Agreement any Note or any other Loan Document, and to
save any holder of any Note harmless from any and all
liabilities with respect to or resulting from any delay or
omission to pay any such taxes. The obligations of the
Borrower under this Section shall survive the termination
of this Agreement and/or the payment of the Notes.
13.5. Lien on Real and Personal Property. At
the request of the Bank, the Borrower shall xxxxx x xxxx and
security interest in and to all property, both real and
personal, of whatever kind or nature owned by the Borrower,
to the Bank and obtain subordination of any prior existing
lien or security interest encumbering all or a portion of
such property, in order that the Bank's lien and security
interest shall be first and prior to all other liens and
security interests. The Borrower shall supply the Bank with
all information, instruments, permits, plans, contracts,
environmental assessments, and appraisals relating to such
property and otherwise assist the Bank in evaluating whether
it will take a lien or security interest on the Borrower's
property. The Borrower shall sign such deeds of trusts,
pledges, security agreements, financing statements,
certificates, consents, and agreements as the Bank may
require, the Borrower shall and obtain all third-party
signatures reasonably required thereon, in connection with
the granting of any lien or security interest for the
benefit of the Bank.
13.6. Notices. All notices and other
communications provided for herein shall be in writing
(including telex, facsimile, or cable communication) and
shall be mailed, telecopied, telexed, cabled or delivered
addressed as follows:
(a) If to the Borrower, to it at:
c/o Freeport McMoRan, Inc.
0000 Xxxxxxx Xxxxxx
Xxx Xxxxxxx, Xxxxxxxxx 00000
Telephone No.: (000) 000-0000
Telecopy No.: (000) 000-0000
Attention: Xx. Xxxxxx X. Xxxxx
(b) If to the Bank, to it at:
Texas Commerce Bank National Association
Xxxxx Xxxxxxxx, 0xx Xxxxx
Xxxx Xxxxxx Group
000 Xxxxxx
Xxxxxxx, Xxxxx 00000
Telephone No.: (000) 000-0000
Telecopy No.: (000) 000-0000
Attention: Xx. Xxxxx X. Xxxxx
or to such other address as shall be designated by such
party in a written notice to the other party. All such
notices and communications shall, when mailed, telecopied,
telexed, transmitted, or cabled, become effective when
deposited in the mail, confirmed by telex answerback,
transmitted by the telecopier, or delivered to the cable
company, except that notices and communications to the Bank
shall not be effective until actually received by the Bank.
13.7. Governing Law. UNLESS OTHERWISE SPECIFIED
THEREIN, EACH LOAN DOCUMENT SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF TEXAS
AND THE UNITED STATES OF AMERICA; provided, however, that
Chapter 15 of Subtitle 3, Title 79, Revised Civil Statutes
of Texas, 1925, as amended (Articles 5069-15.01 through
5069-15.11, Vernon's Texas Civil Statutes, as amended) shall
not apply to this Agreement and the Revolving Note issued
hereunder.
13.8. Survival of Representations, Warranties
and Covenants. All representations, warranties and
covenants contained herein or made in writing by the
Borrower in connection herewith shall survive the execution
and delivery of this Agreement and the Notes, and will bind
and inure to the benefit of the respective successors and
assigns of the parties hereto, whether so expressed or not,
provided that the undertaking of the Bank to make Loans to
the Borrower shall not inure to the benefit of any successor
or assign of the Borrower. No investigation at any time
made by or on behalf of the Bank shall diminish the Bank's
right to rely on such representations, warranties and
covenants contained herein or made in writing by the
Borrower. All statements contained in any certificate or
other written instrument delivered by the Borrower or by any
Person authorized by the Borrower under or pursuant to this
Agreement or in connection with the transactions
contemplated hereby shall constitute representations and
warranties hereunder as of the time made by the Borrower.
13.9. Counterparts. This Agreement may be
executed in several counterparts, and by the parties hereto
on separate counterparts, and each counterpart, when so
executed and delivered, shall constitute an original
instrument, and all such separate counterparts shall
constitute but one and the same instrument.
13.10. Separability. Should any clause,
sentence, paragraph or Section of this Agreement be
judicially declared to be invalid, unenforceable or void,
such decision shall not have the effect of invalidating or
voiding the remainder of this Agreement, and the parties
hereto agree that the part or parts of this Agreement so
held to be invalid, unenforceable or void will be deemed to
have been stricken herefrom and the remainder will have the
same force and effectiveness as if such part or parts had
never been included herein. Each covenant contained in this
Agreement shall be construed (absent an express contrary
provision herein) as being independent of each other
covenant contained herein, and compliance with any one
covenant shall not (absent such an express contrary
provision) be deemed to excuse compliance with one or more
other covenants.
13.11. Descriptive Headings. The section
headings in this Agreement have been inserted for
convenience only and shall be given no substantive meaning
or significance whatsoever in construing the terms and
provisions of this Agreement.
13.12. Accounting Terms. All accounting terms
used herein which are not expressly defined in this
Agreement, or the respective meanings of which are not
otherwise qualified, shall have the respective meanings
given to them in accordance with generally accepted
accounting principles.
13.13. Limitation of Liability. No claim may be
made by the Borrower or any other Person against the Bank or
the Affiliates, directors, officers, employees, attorneys,
or agents of the Bank for any special, indirect,
consequential, or punitive damages in respect of any claim
for breach of contract arising out of or related to the
transactions contemplated by this Agreement, or any act,
omission, or event occurring in connection herewith and the
Borrower hereby waives, releases, and agrees not to xxx upon
any claim for any such damages, whether or not accrued and
whether or not known or suspected to exist in its favor.
13.14. Set-off. The Borrower hereby gives and
confirms to the Bank a right of set-off of all moneys,
securities and other property of the Borrower (whether
special, general or limited) and the proceeds thereof, now
or hereafter delivered to remain with or in transit in any
manner to the Bank, its correspondents or its agents from or
for the Borrower, whether for safekeeping, custody, pledge,
transmission, collection or otherwise or coming into
possession of the Bank in any way, and also, any balance of
any deposit accounts and credits of the Borrower with, and
any and all claims of security for the payment of the Notes
and of all other liabilities and obligations now or
hereafter owed by the Borrower to the Bank, contracted with
or acquired by the Bank, whether such liabilities and
obligations be joint, several, absolute, contingent,
secured, unsecured, matured or unmatured, and the Borrower
hereby authorizes the Bank at any time or times, without
prior notice, to apply such money, securities, other
property, proceeds, balances, credits of claims, or any part
of the foregoing, to such liabilities in such amounts as it
may select, whether such liabilities be contingent,
unmatured or otherwise, and whether any collateral security
therefor is deemed adequate or not. The rights described
herein shall be in addition to any collateral security, if
any, described in any separate agreement executed by the
Borrower.
13.15. Sale or Assignment. The Bank reserves the
right, in its sole discretion, without notice to the
Borrower, to sell participations in all or any part of any
Loan, the Notes, the Reimbursement Obligations, or the
Commitment evidenced by this Agreement; or the Bank may
assign one hundred percent (100%) of its interest in all or
any part of any Loan, the Notes, or the Commitment evidenced
by this Agreement or the Reimbursement Obligations, (i) to a
successor of the Bank or in connection with a sale to a
governmental entity or quasi-governmental entity; or
(ii) with the prior written consent of the Borrower, which
consent shall not be unreasonably withheld.
13.16. Interest. All agreements between the
Borrower and the Bank, whether now existing or hereafter
arising and whether written or oral, are hereby expressly
limited so that in no contingency or event whatsoever,
whether by reason of demand being made on any Note or
otherwise, shall the amount paid, or agreed to be paid, to
the Bank for the use, forbearance, or detention of the money
to be loaned under this Agreement or otherwise or for the
payment or performance of any covenant or obligation
contained herein or in any other Loan Document exceed the
Highest Lawful Rate. If, as a result of any circumstances
whatsoever, fulfillment of any provision hereof or of any of
such documents, at the time performance of such provision
shall be due, shall involve transcending the limit of
validity prescribed by applicable usury law, then, ipso
facto, the obligation to be fulfilled shall be reduced to
the limit of such validity, and if, from any such
circumstance, the Bank shall ever receive interest or
anything which might be deemed interest under applicable law
which would exceed the Highest Lawful Rate, such amount
which would be excessive interest shall be applied to the
reduction of the principal amount owing on account of the
Notes or the amounts owing on other obligations of the
Borrower to the Bank under any Loan Document and not to the
payment of interest, or if such excessive interest exceeds
the unpaid principal balance of the Notes and the amounts
owing on other obligations of the Borrower to the Bank under
any Loan Document, as the case may be, such excess shall be
refunded to the Borrower. All sums paid or agreed to be
paid to the Bank for the use, forbearance, or detention of
the indebtedness of the Borrower to the Bank shall, to the
extent permitted by applicable law, be amortized, prorated,
allocated, and spread throughout the full term of such
indebtedness until payment in full of the principal thereof
(including the period of any renewal or extension thereof)
so that the interest on account of such indebtedness shall
not exceed the Highest Lawful Rate. The terms and
provisions of this Section shall control and supersede
every other provision of all agreements between the Borrower
and the Bank.
13.17. Indemnification. The Borrower agrees to
indemnify, defend, and save harmless the Bank and its
officers, directors, employees, agents, and attorneys, and
each of them (the "Indemnified Parties"), from and against
all claims, actions, suits, and other legal proceedings,
damages, costs, interest, charges, taxes, counsel fees, and
other expenses and penalties which any of the Indemnified
Parties may sustain or incur by reason of or arising out of
(i) the making of any Loan hereunder, the execution and
delivery of this Agreement, the Notes and the other Loan
Documents and the consummation of the transactions
contemplated thereby and the exercise of any of the Bank's
rights under this Agreement, the Notes and the other Loan
Documents or otherwise, including, without limitation,
damages, costs, and expenses incurred by any of the
Indemnified Parties in investigating, preparing for,
defending against, or providing evidence, producing
documents, or taking any other action in respect of any
commenced or threatened litigation under any federal
securities law or any similar law of any jurisdiction or at
common law or (ii) any and all claims or proceedings
(whether brought by a private party, governmental authority,
or otherwise) for bodily injury, property damage, abatement,
remediation, environmental damage, or impairment or any
other injury or damage resulting from or relating to the
Release of any Hazardous Materials located upon, migrating
into, from, or through or otherwise relating to any property
owned or leased by the Borrower (whether or not the Release
of such Hazardous Materials was caused by the Borrower, a
tenant, or subtenant of the Borrower, a prior owner, a
tenant, or subtenant of any prior owner or any other party
and whether or not the alleged liability is attributable to
the handling, storage, generation, transportation, or
disposal of any Hazardous Materials or the mere presence of
any Hazardous Materials on such property; provided that the
Borrower shall not be liable to the Indemnified Parties
where the Release of such Hazardous Materials occurs at any
time at which the Borrower ceases to own such property); and
provided further that no Indemnified Party shall be entitled
to the benefits of this Section to the extent its own gross
negligence or willful misconduct contributed to its loss;
and provided further that it is the intention of the
Borrower to indemnify the Indemnified Parties against the
consequences of their own negligence. This Agreement is
intended to protect and indemnify the Indemnified Parties
against all risks hereby assumed by the Borrower. The
obligations of the Borrower under this Section shall
survive any the repayment of the Notes, the discharge and
release of any Person under any Loan Document and any
termination of this Agreement.
13.18. Payments Set Aside. To the extent that
the Borrower makes a payment or payments to the Bank or the
Bank exercises its right of setoff, and such payment or
payments or the proceeds of such setoff or any part thereof
are subsequently invalidated, declared to be fraudulent or
preferential, set aside and/or required to be repaid to a
trustee, receiver or any other Person under any Debtor Law
or equitable cause, then, to the extent of such recovery,
the obligation or part thereof originally intended to be
satisfied, and all rights and remedies therefor, shall be
revived and shall continue in full force and effect as if
such payment had not been made or setoff had not occurred.
13.19. Loan Agreement Controls. If there are any
conflicts or inconsistencies among this Agreement and any of
the other Loan Documents, the provisions of this Agreement
shall prevail and control.
13.20. HLT Classification. If the Bank or a
Governmental Authority of the United States or any state
thereof with supervisory authority over the Bank classifies
any Loan or Facility Letter of Credit Obligation or similar
extension of credit or commitment for same under this
Agreement or any Note as a "highly leveraged transaction"
(or successor regulatory category) under regulations or
guidelines published and/or administered by bank regulatory
authorities of the United States or any state thereof (an
"HLT Classification"), the Bank shall notify the Borrower
that the HLT Classification was made by a Governmental
Authority of the United States or any state thereof with
supervisory authority over the Bank. If, as a result of
such HLT Classification the Bank incurs additional costs
(whether regarding taxation, required levels of reserves,
deposits, insurance, or capital, including any allocation of
capital requirements or conditions, or similar
requirements), the Bank shall notify the Borrower of such
increased costs; and the Borrower shall, within fifteen (15)
days of such notice by the Bank, pay to the Bank such
additional amounts as (in the Bank's sole judgment, after
good faith and reasonable computation) will compensate the
Bank for such increase in costs.
13.21. Capital Requirements and Yield Maintenance.
If at any time after the date hereof, the Bank determines that
the adoption or modification of any applicable law, rule or
regulation regarding taxation, the Bank's required levels of
reserves, deposits, insurance or capital (including any
allocation of capital requirements or conditions), or similar
requirements, or any interpretation or administration thereof
by any governmental authority, central bank or comparable
agency charged with the interpretation, administration or
compliance of the Bank with any of such requirements, has or
would have the effect of (i) increasing the Bank's costs
relating to the obligations hereunder, or (ii) reducing the
yield or rate of return of the Bank on the obligation hereunder,
to a level below that which the Bank could have achieved but
for the adoption or modification of any such requirements,
the Borrower shall, within fifteen (15) days of any request
by the Bank, pay to the Bank such additional amounts as (in
the Bank's sole judgment, after good faith and reasonable
computation) will compensate the Bank for such increase in
costs or reduction in yield or rate of return of the Bank.
No failure by the Bank immediately to demand payment of any
additional amounts payable hereunder or under Section shall
constitute a waiver of the Bank's right to demand payment of
such amounts at any subsequent time. Nothing herein contained
shall be construed or so operate as to require the Borrower
to pay any interest, fees, costs or charges greater than
is permitted by applicable law.
13.22. FINAL AGREEMENT. THIS WRITTEN AGREEMENT
REPRESENTS THE FINAL AGREEMENT BETWEEN THE PARTIES AND MAY
NOT BE CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS,
OR SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES. THERE ARE NO
UNWRITTEN ORAL AGREEMENTS BETWEEN THE PARTIES.
IN WITNESS WHEREOF, the parties hereto, by their
respective officers thereunto duly authorized, have executed
this Agreement on the dates set forth in the respective
acknowledgments to be effective as of December 20, 1996.
CIRCLE C LAND CORP., a Texas corporation
By:
Xxxxxxx X. Xxxxxxxxx, III, President
TEXAS COMMERCE BANK NATIONAL ASSOCIATION,
a national banking association
By:
Xxxxx X. Xxxxx, Vice President
AGREED AND CONSENTED TO AS OF THE EFFECTIVE DATE HEREOF BY
GUARANTOR, WHOSE DULY AUTHORIZED OFFICER HAS SIGNED BELOW,
WITH THE POWER AND AUTHORITY TO BIND THE GUARANTOR ON BEHALF
OF WHOM SUCH OFFICER SIGNS, AND GUARANTOR HEREBY AFFIRMS,
ITS OBLIGATIONS UNDER THE GUARANTY AGREEMENTS:
Freeport-McMoRan Inc., a
Delaware corporation
By:
Name:
Title:
THE STATE OF TEXAS
COUNTY OF XXXXXX
BEFORE ME, the undersigned authority, a notary
public, on this day personally appeared Xxxxxxx X.
Xxxxxxxxx, III, President of Circle C Land Corp., a Texas
corporation, known to me to be the person whose name is
subscribed to the foregoing instrument and acknowledged to
me that he executed the same for the purposes and
consideration therein expressed and in the capacity therein
stated, on behalf of said corporation.
Given under my hand and seal of office on this the
____ day of December, 1996.
Notary Public In and For the State of Texas
Typed or Printed Name of Notary
Commission Expiration Date
THE STATE OF TEXAS
COUNTY OF XXXXXX
BEFORE ME, the undersigned authority, a notary
public, on this day personally appeared Xxxxx X. Xxxxx, Vice
President of Texas Commerce Bank National Association, a
national banking association, known to me to be the person
whose name is subscribed to the foregoing instrument and
acknowledged to me that he executed the same for the
purposes and consideration therein expressed and in the
capacity therein stated, on behalf of said association.
Given under my hand and seal of office on this the
____ day of December, 1996.
Notary Public In and For the State of Texas
Typed or Printed Name of Notary
Commission Expiration Date
STATE OF LOUISIANA
PARISH OF ORLEANS
On this ____ day of December, 1996, before me
appeared _____________________ ____________________________,
to me personally known, who, being by me duly sworn did say
that he is the _________ of Freeport-McMoRan Inc., a
Delaware corporation, and that the seal affixed to said
instrument is the corporate seal of said corporation and
that said instrument was signed and sealed in behalf of said
corporation by authority of its board of directors and said
____________________________ acknowledged said instrument to
be the free act and deed of said corporation.
Notary Public, State of Louisiana
(Typed or Printed Name of Notary)
SCHEDULE
STANDBY LETTERS OF CREDIT
The following Standby Letter of Credit is the only Letter of
Credit that is still in effect on the Second Closing Date
for the account of Circle C Land Corporation issued by Texas
Commerce Bank National Association:
Amount
Letter of Credit No. I-426230 $ 85,573
Dated: February 5, 1992
Maturity: February 6, 1997
Beneficiary: City of Austin
Form: Subdivision
EXHIBIT "A"
AMENDED AND RESTATED TERM NOTE
$15,628,358.00 December 20, 1996
FOR VALUE RECEIVED, the undersigned, CIRCLE C LAND
CORP., a corporation organized under the laws of Texas (the
"Borrower"), HEREBY PROMISES TO PAY to the order of TEXAS
COMMERCE BANK NATIONAL ASSOCIATION, a national banking
association (the "Bank"), on or before February 28, 1998
(the "Maturity Date"), the principal sum of Fifteen Million
Six Hundred Twenty-Eight Thousand Three Hundred Fifty-Eight
and No/100 Dollars ($15,628,358.00) in accordance with the
terms and provisions of that certain Amended and Restated
Credit Agreement dated as of December 20, 1996 by and
between the Borrower and the Bank (the "Credit Agreement";
capitalized terms used herein and not otherwise defined
herein shall have the meanings ascribed to such terms in the
Credit Agreement).
The outstanding principal balance of this Amended
and Restated Term Note (this "Term Note") shall be due and
payable on the Maturity Date and as otherwise provided in
the Credit Agreement. The Borrower promises to pay interest
on the unpaid principal balance of this Term Note from the
date of the Loan evidenced by this Term Note until the
principal balance thereof is paid in full. Interest shall
accrue on the outstanding principal balance of this Term
Note from and including the date of the Loan evidenced by
this Term Note to but not including the Maturity Date at the
rate or rates, and shall be due and payable on the dates,
set forth in the Credit Agreement. Any amount not paid when
due with respect to principal (whether at stated maturity,
by acceleration or otherwise), costs or expenses, or, to the
extent permitted by applicable law, interest, shall bear
interest from the date when due to and excluding the date
the same is paid in full, payable on demand, at the rate
provided for in Section 2.1(b) of the Credit Agreement.
Payments of principal and interest, and all
amounts due with respect to costs and expenses, shall be
made in lawful money of the United States of America in
immediately available funds, without deduction, set-off or
counterclaim to the Bank not later than 11:00 a.m. (Houston
time) on the dates on which such payments shall become due
pursuant to the terms and provisions set forth in the Credit
Agreement.
If any payment of principal or interest on this
Term Note shall become due on a Saturday, Sunday, or public
holiday on which the Bank is not open for business, such
payment shall be made on the next succeeding Business Day
and such extension of time shall in such case be included in
computing interest in connection with such payment.
In addition to all principal and accrued interest
on this Term Note, the Borrower agrees to pay (a) all
reasonable costs and expenses incurred by all owners and
holders of this Term Note in collecting this Term Note
through any probate, reorganization, bankruptcy or any other
proceeding and (b) reasonable attorneys' fees when and if
this Term Note is placed in the hands of an attorney for
collection after default.
All agreements between the Borrower and the Bank,
whether now existing or hereafter arising and whether
written or oral, are hereby expressly limited so that in no
contingency or event whatsoever, whether by reason of demand
being made on this Term Note or otherwise, shall the amount
paid, or agreed to be paid, to the Bank for the use,
forbearance, or detention of the money to be loaned under
the Credit Agreement and evidenced by this Term Note or
otherwise or for the payment or performance of any covenant
or obligation contained in the Credit Agreement, this Term
Note or in any other Loan Document exceed the Highest Lawful
Rate. If, as a result of any circumstances whatsoever,
fulfillment of any provision hereof or of any of such
documents, at the time performance of such provision shall
be due, shall involve transcending the limit of validity
prescribed by applicable usury law, then, ipso facto, the
obligation to be fulfilled shall be reduced to the limit of
such validity, and if, from any such circumstance, the Bank
shall ever receive interest or anything which might be
deemed interest under applicable law which would exceed the
Highest Lawful Rate, such amount which would be excessive
interest shall be applied to the reduction of the principal
amount owing on account of this Term Note or the amounts
owing on other obligations of the Borrower to the Bank under
any Loan Document and not to the payment of interest, or if
such excessive interest exceeds the unpaid principal balance
of this Term Note and the amounts owing on other obligations
of the Borrower to the Bank under any Loan Document, as the
case may be, such excess shall be refunded to the Borrower.
In determining whether or not the interest paid or payable
under any specific contingencies exceeds the Highest Lawful
Rate, the Borrower and the Bank shall, to the maximum extent
permitted under applicable law, (a) characterize any non-
principal payment as an expense, fee or premium rather than
as interest; (b) exclude voluntary prepayments and the
effects thereof; and (c) amortize, prorate, allocate and
spread in equal parts during the period of the full stated
term of this Term Note, all interest at any time contracted
for, charged, received or reserved in connection with the
indebtedness evidenced by this Term Note.
This Term Note is one of the Notes provided for
in, and is entitled to the benefits of, the Credit
Agreement, which Credit Agreement, among other things,
contains provisions for acceleration of the maturity hereof
upon the happening of certain stated events, for prepayments
on account of principal hereof prior to the maturity hereof
upon the terms and conditions and with the effect therein
specified, and provisions to the effect that no provision of
the Credit Agreement or this Term Note shall require the
payment or permit the collection of interest in excess of
the Highest Lawful Rate. The obligations of the Borrower
hereunder are guaranteed by the Guaranty Agreements.
Except as otherwise specifically provided for in
the Credit Agreement, the Borrower and any and all
endorsers, guarantors and sureties severally waive grace,
demand, presentment for payment, notice of dishonor or
default, protest, notice of protest, notice of intent to
accelerate, notice of acceleration and diligence in
collecting and bringing of suit against any party hereto,
and agree to all renewals, extensions or partial payments
hereon, with or without notice, before or after maturity.
THIS TERM NOTE SHALL BE GOVERNED BY, AND CONSTRUED
IN ACCORDANCE WITH, THE LAWS OF THE STATE OF TEXAS AND
APPLICABLE FEDERAL LAW.
This Term Note shall be deemed to be a contract
under the law of the State of Texas. The Borrower and the
Bank further agree that, insofar as the provisions of
Article 1.04, Subtitle 1, Title 79, of the Revised Civil
Statutes of Texas, 1925, as amended, are relevant to the
determination of the maximum rate of interest permitted by
applicable law in respect of this Term Note, the indicated
rate ceiling computed pursuant to Section (a) of such
Article shall apply to this Term Note.
This Term Note amends and restates that certain
Term Note dated February 6, 1992 executed by Borrower and
payable to the order of Bank in the original principal
amount of $32,000,000.00 (the "Initial Term Note"), and it
is expressly agreed to and understood by the Borrower that
this Term Note (i) is given in substitution for and
restatement and modification of, and not as payment of, the
Initial Term Note, and (ii) is in no way intended to
constitute a novation of the Initial Term Note.
THIS TERM NOTE, TOGETHER WITH THE OTHER LOAN
DOCUMENTS, REPRESENTS THE FINAL AGREEMENT BETWEEN THE
PARTIES AND MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR,
CONTEMPORANEOUS, OR SUBSEQUENT ORAL AGREEMENT OF THE
PARTIES.
THERE ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN THE
PARTIES.
IN WITNESS WHEREOF, the Borrower has caused this
Term Note to be executed and delivered by its officer
thereunto duly authorized effective as of the date first
above written.
CIRCLE C LAND CORP., a Texas corporation
By: _________________________
Xxxxxxx X. Xxxxxxxxx, III,
President
EXHIBIT "B"
AMENDED AND RESTATED REVOLVING NOTE
$13,500,000.00 December 20, 1996
FOR VALUE RECEIVED, the undersigned, CIRCLE C LAND
CORP., a corporation organized under the laws of Texas (the
"Borrower"), HEREBY PROMISES TO PAY to the order of TEXAS
COMMERCE BANK NATIONAL ASSOCIATION, a national banking
association (the "Bank"), on or before February 28, 1998
(the "Maturity Date"), the principal sum of Thirteen Million
Five Hundred Thousand and 00/100 Dollars ($13,500,000.00) or
so much as may be advanced from time to time, in accordance
with the terms and provisions of that certain Amended and
Restated Credit Agreement dated as of December 20, 1996 by
and between the Borrower and the Bank, as the same may be
amended, restated or supplemented and in effect from time to
time, the "Credit Agreement"; capitalized terms used herein
and not otherwise defined herein shall have the meanings
ascribed to such terms in the Credit Agreement).
The outstanding principal balance of this Amended
and Restated Revolving Note (this "Revolving Note") shall be
due and payable on the payment dates as provided in the
Credit Agreement. The Borrower promises to pay interest on
the unpaid principal balance of this Revolving Note from the
date of any Loan evidenced by this Revolving Note
(including, without limitation, any Loan previously
evidenced by the Prior Notes, as hereinafter defined) until
the principal balance thereof is paid in full. Interest
shall accrue on the outstanding principal balance of this
Revolving Note from and including the date of any Loan
evidenced by this Revolving Note (including, without
limitation, any Loan previously evidenced by the Prior
Notes, as hereinafter defined) to but not including the
Maturity Date at the rate or rates, and shall be due and
payable on the dates, set forth in the Credit Agreement.
Any amount not paid when due with respect to principal
(whether at stated maturity, by acceleration or otherwise),
costs or expenses, or, to the extent permitted by applicable
law, interest, shall bear interest from the date when due to
and excluding the date the same is paid in full, payable on
demand, at the rate provided for in Section 2.2(b) of the
Credit Agreement.
Payments of principal and interest, and all
amounts due with respect to costs and expenses, shall be
made in lawful money of the United States of America in
immediately available funds, without deduction, set-off or
counterclaim to the Bank not later than 11:00 a.m. (Houston
time) on the dates on which such payments shall become due
pursuant to the terms and provisions set forth in the Credit
Agreement.
If any payment of principal or interest on this
Revolving Note shall become due on a Saturday, Sunday, or
public holiday on which the Bank is not open for business,
such payment shall be made on the next succeeding Business
Day and such extension of time shall in such case be
included in computing interest in connection with such
payment.
In addition to all principal and accrued interest
on this Revolving Note, the Borrower agrees to pay (a) all
reasonable costs and expenses incurred by all owners and
holders of this Revolving Note in collecting this Revolving
Note through any probate, reorganization, bankruptcy or any
other proceeding and (b) reasonable attorneys' fees when and
if this Revolving Note is placed in the hands of an attorney
for collection after default.
All agreements between the Borrower and the Bank,
whether now existing or hereafter arising and whether
written or oral, are hereby expressly limited so that in no
contingency or event whatsoever, whether by reason of demand
being made on this Revolving Note or otherwise, shall the
amount paid, or agreed to be paid, to the Bank for the use,
forbearance, or detention of the money to be loaned under
the Credit Agreement and evidenced by this Revolving Note or
otherwise or for the payment or performance of any covenant
or obligation contained in the Credit Agreement, this
Revolving Note or in any other Loan Document exceed the
Highest Lawful Rate. If, as a result of any circumstances
whatsoever, fulfillment of any provision hereof or of any of
such documents, at the time performance of such provision
shall be due, shall involve transcending the limit of
validity prescribed by applicable usury law, then, ipso
facto, the obligation to be fulfilled shall be reduced to
the limit of such validity, and if, from any such
circumstance, the Bank shall ever receive interest or
anything which might be deemed interest under applicable law
which would exceed the Highest Lawful Rate, such amount
which would be excessive interest shall be applied to the
reduction of the principal amount owing on account of this
Revolving Note or the amounts owing on other obligations of
the Borrower to the Bank under any Loan Document and not to
the payment of interest, or if such excessive interest
exceeds the unpaid principal balance of this Revolving Note
and the amounts owing on other obligations of the Borrower
to the Bank under any Loan Documents, as the case may be,
such excess shall be refunded to the Borrower. In
determining whether or not the interest paid or payable
under any specific contingencies exceeds the Highest Lawful
Rate, the Borrower and the Bank shall, to the maximum extent
permitted under applicable law, (a) characterize any non-
principal payment as an expense, fee or premium rather than
as interest; (b) exclude voluntary prepayments and the
effects thereof; and (c) amortize, prorate, allocate and
spread in equal parts during the period of the full stated
term of this Revolving Note, all interest at any time
contracted for, charged, received or reserved in connection
with the indebtedness evidenced by this Revolving Note.
This Revolving Note is one of the Notes provided
for in, and is entitled to the benefits of the Credit
Agreement, which Credit Agreement, among other things,
contains provisions for acceleration of the maturity hereof
upon the happening of certain stated events, for prepayments
on account of principal hereof prior to the maturity hereof
upon the terms and conditions and with the effect therein
specified, and provisions to the effect that no provision of
the Credit Agreement or this Revolving Note shall require
the payment or permit the collection of interest in excess
of the Highest Lawful Rate. The obligations of the Borrower
hereunder are guaranteed by the Guaranty Agreements. It is
contemplated that by reason of prepayments or repayments
hereon prior to the Maturity Date, there may be times when
no indebtedness is owing hereunder prior to such date, but
notwithstanding such occurrences, this Revolving Note shall
remain valid and shall be in full force and effect as to Loans
made pursuant to the Credit Agreement subsequent to each such
occurrence.
Except as otherwise specifically provided for in
the Credit Agreement, the Borrower and any and all
endorsers, guarantors and sureties severally waive grace,
demand, presentment for payment, notice of dishonor or
default, protest, notice of protest, notice of intent to
accelerate, notice of acceleration and diligence in
collecting and bringing of suit against any party hereto,
and agree to all renewals, extensions or partial payments
hereon, with or without notice, before or after maturity.
THIS REVOLVING NOTE SHALL BE GOVERNED BY, AND
CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF TEXAS
AND APPLICABLE FEDERAL LAW.
This Revolving Note shall be deemed to be a
contract under the law of the State of Texas. The Borrower
and the Bank further agree that, insofar as the provisions
of Article 1.04, Subtitle 1, Title 79, of the Revised Civil
Statutes of Texas, 1925, as amended, are relevant to the
determination of the maximum rate of interest permitted by
applicable law in respect of this Revolving Note, the
indicated rate ceiling computed pursuant to Section (a) of
such Article shall apply to this Revolving Note.
This Revolving Note amends and restates that
certain Revolving Note dated as of September 1, 1993,
executed by the Borrower and payable to the order of the
Bank in the face amount of $13,500,000.00 (the "Previous
Note"). The Previous Note amended and restated that certain
Revolving Note dated as of February 6, 1992, executed by the
Borrower and payable to the order of the Bank in the face
amount of $8,500,000.00 (the "Initial Note"), and it is
expressly understood and agreed to by the Borrower that this
Revolving Note (i) is given in substitution for and
restatement and modification of, and not as payment of, the
Previous Note and the Initial Note (collectively, the "Prior
Notes"), and (ii) is in no way intended to constitute a
novation of the Previous Note or the Initial Note.
THIS REVOLVING NOTE, TOGETHER WITH THE OTHER LOAN
DOCUMENTS, REPRESENTS THE FINAL AGREEMENT BETWEEN THE
PARTIES AND MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR,
CONTEMPORANEOUS, OR SUBSEQUENT ORAL AGREEMENT OF THE
PARTIES.
THERE ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN THE
PARTIES.
IN WITNESS WHEREOF, the Borrower has caused this
Revolving Note to be executed and delivered by its officer
thereunto duly authorized effective as of the date first
above written.
CIRCLE C LAND CORP., a Texas corporation
By: __________________________
Xxxxxxx X. Xxxxxxxxx, III,
President
EXHIBIT "C"
NOTICE OF BORROWING
The undersigned hereby certifies that he is the
Chief Executive Officer or the Chief Financial Officer of
CIRCLE C LAND CORP., a corporation organized under the laws
of Texas (the "Borrower"), and that as such he is authorized
to execute this Notice of Borrowing on behalf of the
Borrower. With reference to that certain Amended and
Restated Credit Agreement dated as of December 20, 1996 (as
same may be amended, modified, increased, supplemented
and/or restated from time to time, the "Credit Agreement")
entered into by and between the Borrower and TEXAS COMMERCE
BANK NATIONAL ASSOCIATION, a national banking association
(the "Bank"), the undersigned further certifies, represents
and warrants on behalf of the Borrower that to his best
knowledge and belief after reasonable and due investigation
and review, all of the following statements are true and
correct (each capitalized term used herein having the same
meaning given to it in the Credit Agreement unless otherwise
specified):
(a) The Borrower requests that the Bank advance
to the Borrower the aggregate sum of $___________ by no
later than __________, 19__. Immediately following such
Loans, the aggregate outstanding balance of the Revolving
Credit Loans shall equal $________. The Borrower requests
that the principal amount for the Bank of the Loans bear
interest as follows:
(i) The principal amount of the Revolving Credit Loan,
if any, which shall bear interest at the Base Rate requested
to be made by the Bank is $________.
(ii) The principal amount of the Revolving Credit Loan,
if any, which shall bear interest at the Eurodollar Rate for
which the initial Rate Period shall be one month requested
to be made by the Bank is $ ________.
(iii) The principal amount of the Revolving Credit Loan,
if any, which shall bear interest at the Eurodollar Rate for
which the initial Rate Period shall be two months requested
to be made by the Bank is $ ________.
(iv) The principal amount of the Revolving Credit Loan,
if any, which shall bear interest at the Eurodollar Rate for
which the initial Rate Period shall be three months
requested to be made by the Bank is $ ________.
(v) The principal amount of the Term Loan, if any,
which shall bear interest at the Base Rate requested to be
made by the Bank is $ ________.
(vi) The principal amount of the Term Loan, if any,
which shall bear interest at the Eurodollar Rate for which
the initial Rate Period shall be one month requested to be
made by the Bank is $ ________.
(vii) The principal amount of the Term Loan, if any,
which shall bear interest at the Eurodollar Rate for which
the initial Rate Period shall be two months requested to be
made by the Bank is $________.
(viii) The principal amount of the Term Loan, if any,
which shall bear interest at the Eurodollar Rate for which
the initial Rate Period shall be three months requested to
be made by the Bank is $ ________.
(b) As of the date hereof, and as a result of the
making of the requested Loans, there does not and will not
exist any Default or Event of Default.
(c) The representations and warranties contained
in Section of the Credit Agreement are true and correct in
all material respects as of the date hereof and shall be
true and correct upon the making of the requested Loans,
with the same force and effect as though made on and as of
the date hereof and thereof.
(d) No change that would cause a material adverse
effect on the business, operations or condition (financial
or otherwise) of the Borrower has occurred since the date of
the most recent financial statements provided to the Bank
dated as of ________, 19__.
(e) The demand deposit account of the Borrower at
the Bank's Applicable Lending Office into which the proceeds
of the borrowing are to be deposited is Account
No. _______________ in the Borrower's name. Alternatively,
the funds are to be transferred by wire in accordance with
the following wire transfer instructions:
;
or delivered to _______________________________ in the form
of a cashier's check made payable to the order of
_______________________________________.
(f) The Expiration Date of each Rate Period
specified in (a) above shall be the last day of such Rate
Period.
EXECUTED AND DELIVERED this ___ day of __________,
19___.
CIRCLE C LAND CORP.
By:
Name:
Title: Chief Executive
Officer/Chief Financial Officer
EXHIBIT "D"
NOTICE OF RATE CONVERSION/CONTINUATION
TO:TEXAS COMMERCE BANK NATIONAL ASSOCIATION, a national
banking association (the "Bank") pursuant to that certain
Amended and Restated Credit Agreement dated as of
December ____, 1996 (as same may be amended, modified,
increased, supplemented and/or restated from time to time,
the "Credit Agreement"), entered into by and between CIRCLE
C LAND CORP. (the "Borrower") and the Bank.
Pursuant to Section (ii) of the Credit Agreement,
this Notice of Rate Change/Continuation (the "Notice")
represents the Borrower's election to [insert one or more of
the following]:
[1.Use if converting Eurodollar Rate Loans to Base Rate
Loans.]
Convert $_____________ in aggregate principal amount of
Eurodollar Rate Loans with a current Rate Period ending
on________, 19__, to Base Rate Loans on____________, 19__.
[and]
[2.Use if converting Base Rate Loans to Eurodollar Rate
Loans.]
Convert $_____________ in aggregate principal amount of Base
Rate Loans to Eurodollar Rate Loans on _________________,
19__. The initial Rate Period for such Eurodollar Rate
Loans is requested to be a [one] [two] [three] (__) month
period.
[3a.Use if continuing Eurodollar Rate Loans] or
[3b.Use with number 1, if converting a portion of
Eurodollar Rate Loans to Base Rate Loans and continuing the
balance as Eurodollar Rate Loans] or
[3c.Use with number 2 if converting a portion of
Base Rate Loans to Eurodollar Loans and continuing
Eurodollar Rate Loans]
Continue $_____________ in aggregate principal amount of
Eurodollar Rate Loans with a current Rate Period ending on
___________________, 19____, as Eurodollar Rate Loans having
a Rate Period of [one] [two] [three] [six] months.
4.Borrower hereby certifies that no Default or Event of
Default has occurred and is continuing under the Credit
Agreement.
Unless otherwise defined herein, terms
defined in the Credit Agreement shall have the same meanings
in this Notice.
Dated: By:
Name:
Title:
EXHIBIT "E"
AMENDED AND RESTATED GUARANTY AGREEMENT
This AMENDED AND RESTATED GUARANTY AGREEMENT (this
"Guaranty") is made to be effective as of December 20, 1996
by FREEPORT-McMoRan INC., a Delaware corporation (the
"Guarantor"), in favor of TEXAS COMMERCE BANK NATIONAL
ASSOCIATION, a national banking association, and its
successors and assigns (the "Bank").
PRELIMINARY STATEMENT. The Bank and Circle C Land
Corp., a Texas corporation (the "Borrower"), have entered
into that certain Credit Agreement dated as of February 6,
1992 (the "Agreement"). The Agreement has been amended by
(i) that certain First Amendment to Credit Agreement dated
to be effective as of June 11, 1992, executed by the
Borrower and the Bank (the "First Amendment"); (ii) that
certain Second Amendment to Credit Agreement dated to be
effective as of November 16, 1992, executed by Borrower and
the Bank (the "Second Amendment"); (iii) that certain Third
Amendment to Credit Agreement dated to be effective as of
May 5, 1993, executed by the Borrower and the Bank (the
"Third Amendment"); (iv) that certain Fourth Amendment to
Credit Agreement and Revolving Note dated to be effective as
of September 1, 1993, executed by the Borrower and the Bank
(the "Fourth Amendment"); (v) that certain Fifth Amendment
to Credit Agreement dated to be effective as of February 2,
1994, executed by the Borrower and the Bank (the "Fifth
Amendment"); (vi) that certain Sixth Amendment to Credit
Agreement dated to be effective as of July 17, 1995,
executed by the Borrower and the Bank (the "Sixth
Amendment"; and (vii) that certain Seventh Amendment to
Credit Agreement dated to be effective as of December 12,
1996, executed by the Borrower and the Bank (the "Seventh
Amendment"); the Agreement as amended by the First
Amendment, Second Amendment, Third Amendment, Fourth
Amendment, Fifth Amendment, Sixth Amendment and Seventh
Amendment, the "Initial Credit Agreement"). Of even date
herewith, the Bank and Borrower have entered into that
certain Amended and Restated Credit Agreement (such Amended
and Restated Credit Agreement, as it may hereafter be
amended from time to time, the "Credit Agreement"), which
amends and restates the Initial Credit Agreement.
The Guarantor entered into that certain Guaranty
Agreement effective as of February 6, 1992, for the benefit
of the Bank, as amended by that certain First Amendment to
Guaranty Agreements, dated to be effective as of June 11,
1992 and executed by the Guarantor on its behalf and as
successor by merger to Longhorn Properties, Inc., a
Delaware corporation, and the Bank (the Guaranty Agreement
as amended, the "Prior Guaranty"). The Prior Guaranty
guaranteed the Borrower's obligations under the Initial
Credit Agreement.
In connection with the spin off of certain assets
of the Guarantor to Freeport-McMoRan Copper & Gold Inc., a
Delaware corporation, the Guarantor entered into that
certain Amended and Restated Guaranty Agreement effective as
of July 17, 1995, for the benefit of the Bank, (the "Prior
Restated Guaranty") which amended and restated the Prior
Guaranty. The Prior Guaranty was amended and restated to
limit the Prior Guaranty (as amended and restated) to all
obligations of the Borrower other than principal and
interest on the Notes, and in exchange therefor, the
Guarantor executed the FTX Guaranty Agreement, dated as of
July 17, 1995, and the FTX Security Agreement. Such FTX
Guaranty Agreement has been amended and restated as of
December 20, 1996, by that certain Amended and Restated FTX
Guaranty Agreement, executed by Guarantor (the "FTX
Guaranty"). The FTX Guaranty Agreement guarantees the
principal and interest on the Notes which are secured as
more fully described therein. This Guaranty amends and
restates the Prior Restated Guaranty, which amended and
restated the Prior Guaranty. Guarantor guarantees certain
of the Borrower's obligations under the Credit Agreement
under this Guaranty.
From the making of the Loans by the Bank to the
Borrower pursuant to the terms and conditions set forth in
the Credit Agreement, the Guarantor will derive substantial
benefit, whether directly or indirectly, from the making of
this Guaranty. It is a condition precedent to the transfer
of funds described above and the making of the Loans under
the Credit Agreement that the Guarantor shall have executed
and delivered this Guaranty.
All terms used herein and not otherwise defined
herein shall have the meanings assigned to them in the
Credit Agreement.
NOW, THEREFORE, in consideration of the premises
and other good and valuable consideration, the adequacy,
receipt and sufficiency of which are hereby acknowledged,
the Guarantor hereby agrees as follows:
SECTION 1. Guaranty. The Guarantor hereby
unconditionally and irrevocably (a) guarantees the punctual
payment when due, whether at stated maturity, by
acceleration, by prepayment or otherwise, of all obligations
of the Borrower now or hereafter existing under the Credit
Agreement, the Notes, the Letter of Credit Reimbursement
Agreement, and all other Loan Documents to which the
Borrower is a party, including, without limitation, the
Reimbursement Obligations and the fees payable by the
Borrower pursuant to the terms of the Credit Agreement other
than the principal and interest on the Notes, and (b) agrees
to pay any and all reasonable expenses (including, without
limitation, reasonable counsel fees and expenses) incurred
by the Bank in enforcing any rights under this Guaranty (all
of the above, other than principal and interest on the
Notes, being hereinafter collectively called the
"Obligations").
SECTION 2. Guaranty Absolute. The Guarantor
guarantees that the Obligations will be paid strictly in
accordance with the terms of the Credit Agreement, the
Notes, the Letter of Credit Reimbursement Agreement, and all
other Loan Documents, regardless of any law, regulation or
order now or hereafter in effect in any jurisdiction
affecting any of such terms or the rights of the Bank with
respect thereto. The liability of the Guarantor under this
Guaranty shall be absolute and unconditional, to the extent
permitted by applicable law, irrespective of:
(a) any lack of validity or enforceability of or
defect or deficiency in the Credit Agreement, the Notes, the
Letter of Credit Reimbursement Agreement, or any of the
other Loan Documents;
(b) any change in the time, manner, terms or
place of payment of, or in any other term of, all or any of
the Obligations, or any other amendment or waiver of or any
consent to departure from the Credit Agreement, the Notes,
the Letter of Credit Reimbursement Agreement, or any of the
other Loan Documents;
(c) any sale, exchange, release or non-perfection
of any Property hereafter standing as security for the
liabilities hereby guaranteed or any liabilities incurred
directly or indirectly hereunder or any set-off against any
of said liabilities, or any release or amendment or waiver
of or consent to departure from any other guaranty, for all
or any of the Obligations;
(d) any change in the existence, structure or
ownership of the Guarantor or the Borrower, or any
insolvency, bankruptcy, reorganization or other similar
proceeding affecting the Borrower or its assets;
(e) the existence of any claim, set-off or other
rights which the Guarantor may have at any time against the
Borrower, the holder or holders of the Notes or any Note, or
any other Person, whether or not arising in connection with
this Guaranty, the Credit Agreement, the Notes, the Letter
of Credit Reimbursement Agreement, or any other Loan
Document;
(f) any other circumstance which might otherwise
constitute a defense available to, or a discharge of, the
Borrower or any other Person (including any guarantor) in
respect of the Obligations, other than payment in full by
the Borrower of the Obligations.
This Guaranty shall continue to be effective or be
reinstated, as the case may be, if at any time any payment
of any of the Obligations is annulled, set aside,
invalidated, declared to be fraudulent or preferential,
rescinded or must otherwise be returned, refunded or repaid
by the Bank upon the insolvency, bankruptcy, dissolution,
liquidation or reorganization of the Borrower, or any other
guarantor, or upon or as a result of the appointment of a
receiver, intervenor or conservator of, or trustee or
similar officer for, the Borrower or any other guarantor or
any substantial part of the property of the Borrower or any
other guarantor or otherwise, all as though such payment or
payments had not been made. The obligations of the
Guarantor under this Guaranty shall not be subject to
reduction, termination or other impairment by reason of any
setoff, recoupment, counterclaim or defense or for any other
reason.
SECTION 3. Continuing Guaranty. This is a
continuing Guaranty, and all extensions of credit and
financial accommodations heretofore, concurrently herewith
or hereafter made by the Bank to the Borrower which
constitute Obligations or are made in connection with the
Obligations and all indebtedness of the Borrower now owned
or hereafter acquired by the Bank which constitute
Obligations or are made in connection with the Obligations
shall be conclusively presumed to have been made or acquired
in acceptance hereof.
SECTION 4. Notice. The Bank agrees to give the
following notices to the Guarantor before payment is due
hereunder by the Guarantor: (i) five (5) days' written
notice for any Event of Default set forth in Sections 12.1,
12.2, 12.3, and 12.4 of the Credit Agreement; (ii) fifteen
(15) days' written notice for an Event of Default set forth
in Sections 12.5, 12.6, 12.7, 12.10, 12.11, 12.12, and 12.13
of the Credit Agreement; and (iii) no notice for any Event
of Default set forth in Sections 12.8 and 12.9 of the Credit
Agreement. If the Event of Default remains unremedied on
the expiration of the applicable time period, the Bank may
at such time pursue the Guarantor under the terms of this
Guaranty without further notice or demand.
SECTION 5. Waiver. This is an absolute Guaranty
of payment and not of collection, and the Guarantor hereby
waives 0.1 promptness, diligence, notice of acceptance,
presentment, demand, protest, notice of protest and
dishonor, notice of intent to accelerate, notice of
acceleration and any other notice with respect to any of the
Obligations and this Guaranty, except as set forth in
Section hereof; and 0.1 any requirement that the Bank
exhaust any right or take any action against the Borrower or
any other Person or entity or that the Borrower or any other
Person or entity be joined in any action hereunder. Should
the Bank seek to enforce the obligations of the Guarantor
hereunder by action in any court, the Guarantor waives any
necessity, substantive or procedural, that a judgment
previously be rendered against the Borrower or any other
Person, or that any action be brought against the Borrower
or any other Person, or that the Borrower or any other
Person should be joined in such cause. Such waiver shall be
without prejudice to the Bank at its option to proceed
against the Borrower or any other Person, whether by
separate action or by joinder.
SECTION 6. Several Obligations. The obligations
of the Guarantor hereunder are several from the Borrower or
any other Person, including without limitation the other
guarantors who are parties to the Guaranties, and are
primary obligations concerning which the Guarantor is the
principal obligor. The Guarantor agrees that this Guaranty
shall not be discharged except by complete performance of
the obligations of the Borrower or any other Person under
the Notes, the Credit Agreement, the Letter of Credit
Reimbursement Agreement, and any other Loan Document to
which the Borrower or such Person is a party and by complete
performance of the obligations of the Guarantor hereunder.
The obligations of the Guarantor hereunder shall not be
affected in any way by any receivership, insolvency,
bankruptcy or other proceedings affecting the Borrower or
any other Person or any of the Borrower's or such Person's
assets, or the release or discharge of the Borrower or any
other Person from the performance of any obligation
contained in any promissory note or other instrument issued
in connection with, evidencing or securing any indebtedness
guaranteed by this instrument, whether occurring by reason
of law or any other cause, whether similar or dissimilar to
the foregoing.
SECTION 7. Subrogation. The Guarantor will not
have any right which it may acquire by way of subrogation or
similar rights under this Guaranty, by reason of any payment
made hereunder or otherwise, until (i) all of the
Obligations shall have been paid in full, and (ii) the
Bank's Commitment under the Credit Agreement shall have been
terminated. If any amount shall be paid to the Guarantor
purportedly on account of any such subrogation rights at any
time when all the Obligations shall not have been paid in
full or at such time as the Bank's Commitment under the
Credit Agreement is in effect, such amount shall be held in
trust for the benefit of the Bank and shall forthwith be
paid to the Bank to be applied to the Obligations in such
order as the Bank shall select.
SECTION 8. Stay of Acceleration. If acceleration
of the time for payment of any amount payable by the
Borrower under the Credit Agreement, the Letter of Credit
Reimbursement Agreement, or the Notes is stayed upon the
insolvency, bankruptcy or reorganization of the Borrower,
all such amounts otherwise subject to acceleration under the
terms of the Credit Agreement or the Letter of Credit
Reimbursement Agreement shall nonetheless be payable by the
Guarantor hereunder forthwith on demand by the holder or
holders of the Notes or the obligee of the Letter of Credit
Reimbursement Agreement.
SECTION 9. Representations and Warranties. The
Guarantor hereby represents and warrants as follows:
(a) The Guarantor (i) is a corporation duly
organized, validly existing, and in good standing under the
laws of the jurisdiction of its incorporation; (ii) has the
corporate power to own its Properties and to carry on its
business as now conducted; and (iii) is duly qualified as a
foreign corporation to do business and is in good standing
in every jurisdiction where such qualification is necessary,
except when the failure to so qualify would not or does not
have a Material Adverse Effect.
(b) The Guarantor is not in default with respect
to any indenture, loan or credit agreement or any lease or
other agreement or instrument or subject to any charter,
bylaw or other corporate restriction which default would
have a Material Adverse Effect. Neither the execution and
delivery of this Guaranty nor the consummation of the
transactions contemplated hereby nor fulfillment of and
compliance with the respective terms, conditions and
provisions hereof or of any instruments required hereby will
conflict with or result in a breach of any of the terms,
conditions or provisions of, or constitute a default under,
or result in any violation of, or result in the creation or
imposition of any Lien on any of the Property of the
Guarantor pursuant to (i) the charter or bylaws applicable
to the Guarantor; (ii) any law or any regulation of any
administrative or governmental instrumentality; (iii) any
order, writ, injunction or decree of any court; or (iv) the
terms, conditions or provisions of any agreement or
instrument to which the Guarantor is a party or by which it
is bound or to which it is subject.
(c) The representations and warranties of the
Guarantor contained in each Loan Document to which Guarantor
is a party are true and correct in all material respects so
as to provide to the Bank and to permit them to realize the
benefits intended to be provided by, and obtained from, each
such Loan Document.
(d) The Guarantor has received, or will receive,
direct or indirect benefit from the making of this Guaranty.
(e) Except as disclosed in the Guarantor's
audited financial statements as of December 31, 1995, and
the Guarantor's unaudited financial statements as of
September 30, 1996, there is no: (a) action or proceeding
pending or, to the knowledge of the Guarantor, threatened
against the Borrower or the Guarantor before any court,
administrative agency or arbitrator which is reasonably
expected to have a Material Adverse Effect; (a) judgment
outstanding against the Guarantor for the payment of money
which would have a Material Adverse Effect; or (a) other
outstanding judgment, order or decree affecting the Borrower
or the Guarantor before or by any administrative or
governmental authority, compliance with or satisfaction of
which may reasonably be expected to have a Material Adverse
Effect.
(f) The Guarantor is not in default under or in
violation of the provisions of any instrument evidencing any
Debt or of any agreement relating thereto or any judgment,
order, writ, injunction or decree of any court or any order,
regulation or demand of any administrative or governmental
instrumentality which default or violation might have a
Material Adverse Effect.
(g) The Guarantor's execution, delivery and
performance of this Guaranty and any Loan Document to which
Guarantor is a party does not require the consent or
approval of any Governmental Authority or any other Person.
The consummation and the effectuation of the transactions
contemplated under this Guaranty and any Loan Document to
which Guarantor is a party do not require the consent or
approval of any Governmental Authority or any other Person,
except such consents and approvals as have been obtained.
(h) This Guaranty is, and all other documents and
instruments executed in connection herewith when delivered
will be, legal, valid and binding obligations of the
Guarantor, enforceable against the Guarantor in accordance
with their respective terms, except as such enforceability
may be (a) limited by the effect of any Debtor Laws and
(a) subject to the effect of general principles of equity
(regardless of whether such enforceability is considered in
a proceeding in equity or at law).
(i) The Guarantor has the corporate power and
authority to make, execute, deliver and carry out this
Guaranty and the transactions contemplated herein, and to
perform its obligations hereunder and all such action has
been duly authorized by all necessary corporate proceedings
on its part. This Guaranty has been duly and validly
executed and delivered by the Guarantor.
(j) The Guarantor is not in violation of any
governmental requirement which violation (in the event such
violation was asserted by any Person) would have a Material
Adverse Effect.
(k) The Guarantor has good and marketable title
to its assets.
(l) The Guarantor has filed all tax returns
required to be filed and has paid all taxes shown on said
returns and all assessments which are due and payable
(except such as are being contested in good faith by
appropriate proceedings for which adequate reserves for
their payment have been provided in a manner consistent with
the generally accepted accounting practices consistently
applied). The Guarantor is not aware of any pending
investigation by any taxing authority or of any claims by
any governmental authority for any unpaid taxes, except for
audits for tax years 1987 through 1989 and certain audits
conducted in various states, as well as other matters
reflected in the Guarantor's financial statements.
(m) The Guarantor is not an "investment company",
or a company "controlled" by an "investment company", within
the meaning of the Investment Company Act of 1940, as
amended.
(n) The Guarantor is not a "holding company", or
a "subsidiary company" of a "holding company", or an
"affiliate" of a "holding company", or an affiliate of a
"subsidiary company" of a "holding company", as such terms
are defined in the Public Utility Holding Company Act of
1935, as amended.
(o) No Reportable Event (as defined in Section 4043(b)
of ERISA) has occurred with respect to any Plan. Each Plan
complies in all material respects with all applicable
provisions of ERISA, and the Guarantor has filed all reports
required by ERISA and the Code to be filed with respect to
each Plan. The Guarantor has no knowledge of any event
which could result in a liability of the Guarantor to the
Pension Benefit Guaranty Corporation. The Guarantor has met
all requirements with respect to funding the Plans imposed
by ERISA or the Code. Since the effective date of Title IV
of ERISA, there have not been any, nor are there now
existing any, events or conditions that would permit any
Plan to be terminated under circumstances which would cause
the lien provided under Section 4068 of ERISA to attach to any
property of the Guarantor. The value of the Plans' benefits
guaranteed under Title IV of ERISA on the date hereof does
not exceed the value of such Plans' assets allocable to such
benefits as of the date of this Guaranty and shall not be
permitted to do so hereafter.
(p) The Guarantor owns or has obtained all
governmental permits, certificates of authority, leases,
patents, trademarks, service marks, trade names, copyrights,
franchises and licenses, and rights with respect thereto,
required or necessary (or, in the sole and independent
judgment of the Guarantor, prudent) in connection with the
conduct of its business as presently conducted or as
proposed to be conducted, except for those the absence of
which would not have a Material Adverse Effect.
(q) (i) All facilities and property owned or
leased by the Guarantor have been and continue to be, owned
or leased and operated by the Guarantor in compliance with
all Environmental Laws, except for violations of
Environmental Laws, which violations have no Material
Adverse Effect; (ii) there has not been (during the period of
the Guarantor's ownership or lease) any Release of Hazardous
Materials at, on or under any property now (or, to the
Guarantor's knowledge, previously) owned or leased by the
Guarantor (A) that required, or may reasonably be expected
to require, the Guarantor to expend funds on remediation or
clean-up activities pursuant to any Environmental Law except
for remediation or clean-up activities that would not be
reasonably expected to have a Material Adverse Effect, or
(B) that otherwise, singly or in the aggregate, has, or may
reasonably be expected to have, a Material Adverse Effect;
(iii) the Guarantor has been issued and is in compliance with
all permits, certificates, approvals, orders, licenses and
other authorizations relating to environmental matters
necessary for its business, the absence of which would not
have a Material Adverse Effect; and (iv) there are no
polychlorinated biphenyls (PCB's) or asbestos-containing
materials or surface impoundments in any of the facilities
now (or, to the knowledge of the Guarantor, previously)
owned or leased by the Guarantor in violation of applicable
Environmental Laws, except for violations of Environmental
Laws which violations have no Material Adverse Effect;
(v) Hazardous Materials have not been generated, used,
treated, recycled, stored or disposed of in any of the
facilities or on any of the property now (or, to the
knowledge of the Guarantor, previously) owned or leased by
the Guarantor during the time of the Guarantor's ownership
in violation of applicable Environmental Laws, except for
violations of Environmental Laws which violations have no
Material Adverse Effect; and (vi) no underground storage tank
located on the property now (or, to the knowledge of the
Guarantor, previously) owned or leased by the Guarantor has
been (and to the extent currently owned or leased is)
operated in violation of applicable Environmental Laws,
except for violations of Environmental Laws which violations
have no Material Adverse Effect.
(r) The business and operations of the Guarantor
as conducted at all times relevant to the transactions
contemplated by this Guaranty shall have been and shall be
in compliance in all respects with all applicable State and
Federal laws, regulations and orders affecting the Guarantor
and the business and operations of the Guarantor, except for
violations, regulations, and orders which have no Material
Adverse Effect.
(s) Upon giving effect to (A) the execution of
this Guaranty and (B) the consummation of the transactions
contemplated under this Guaranty, the following are true and
correct after reasonable investigation:
(i) The fair saleable value of the assets of
the Guarantor exceeds the amount that will be required to be
paid on or in respect of the existing debts and other
liabilities (including, without limitation, pending or
overtly threatened litigation in amounts in excess of
effective insurance coverage and all other contingent
liabilities) of the Guarantor, as they mature.
(ii) The net assets of the Guarantor do not
constitute unreasonably small capital for the Guarantor to
carry out its business as now conducted and as proposed to
be conducted including the capital needs of the Guarantor,
taking into account the particular capital requirements of
the business conducted by the Guarantor, and projected
capital requirements and capital availability thereof.
(iii) The Guarantor does not intend to incur
Debt beyond its ability to pay such Debt as it matures
(taking into account the timing and amounts of cash to be
received by the Guarantor, and of amounts to be payable, on
or in respect of, Debt of the Guarantor).
SECTION 10. Covenant. The Guarantor shall deliver
to the Bank in duplicate:
(a) as soon as available, and in any event within
ninety (90) days after the end of each fiscal year of the
Guarantor, a copy of the audited financial report of the
Guarantor as of the end of such fiscal year and for the
period then ended, containing a balance sheet, statements of
income and stockholders' equity, and a cash flow statement,
all in reasonable detail and certified by a financial
officer of the Guarantor, to have been prepared in
accordance with generally accepted accounting principles
consistently applied, except as may be explained in such
certificate;
(b) as soon as available, and in any event within
forty-five (45) days after the end of each quarterly
accounting period in each fiscal year of the Guarantor
(including the fourth quarter), an unaudited financial
report of the Guarantor as at the end of such quarter and
for the period then ended, containing a balance sheet,
statements of income and stockholder's equity and a cash
flow statement, all in reasonable detail and certified by a
financial officer of the Guarantor to have been prepared in
accordance with generally accepted accounting principles
consistently applied, except as may be explained in such
certificate;
(c) copies of all statements and reports sent to
stockholders of the Guarantor or filed with the Securities
and Exchange Commission; and
(d) such additional financial or other
information as the Bank may reasonably request.
SECTION 11. Amendments, Etc. No amendment or
waiver of any provision of this Guaranty nor consent to any
departure by the Guarantor therefrom shall in any event be
effective unless the same shall be in writing and signed by
the Bank and then such waiver or consent shall be effective
only in the specific instance and for the specific purpose
for which given.
SECTION 12. Notices, Etc. All notices and other
communications provided for hereunder shall be in writing
(including telegraphic, telex, facsimile or cable
communication) and mailed, telegraphed, telexed,
transmitted, cabled or delivered, if to the Guarantor, at
its address:
0000 Xxxxxxx Xxxxxx
Xxx Xxxxxxx, Xxxxxxxxx 00000
Attention: Xxxxxx X. Xxxxx
Telephone No.: (000) 000-0000
Telecopy No.: (000) 000-0000
with copies to:
Xxxxxxx X. Xxxxxx
0000 Xxxxxxx Xxxxxx
Xxx Xxxxxxx, Xxxxxxxxx 00000
Telephone No.: (000) 000-0000
Telecopy No.: (000) 000-0000
and the Borrower as set forth in Section 14.6 of the Credit
Agreement; if to the Bank, at the address for the Bank's
Domestic Lending Office, as the case may be, set forth in
the Credit Agreement, or, as to each party, at such other
address as shall be designated by such party in a written
notice to the other party. All such notices and
communications shall be effective three (3) days after
deposit in the mail, postage pre-paid, or when delivered to
the telegraph company, confirmed by telex answerback,
transmitted by telecopier or delivered to the cable company,
respectively.
SECTION 13. No Waiver; Remedies. No failure on the
part of the Bank to exercise, and no delay in exercising,
any right hereunder shall operate as a waiver thereof; nor
shall any single or partial exercise of any right hereunder
preclude any other or further exercise thereof or the
exercise of any other right. The remedies herein provided
are cumulative and not exclusive of any remedies provided by
law.
SECTION 14. Right of Set-off. Upon the occurrence
and during the continuance of any Event of Default, the Bank
is hereby authorized at any time and from time to time,
without notice to the Guarantor (any such notice being
expressly waived by the Guarantor) to the fullest extent
permitted by law, to set off and apply any and all deposits
(general or special, time or demand, provisional or final)
at any time held and other indebtedness at any time owing by
the Bank to or for the credit or the account of the
Guarantor against any and all of the obligations of the
Guarantor now or hereafter existing under this Guaranty,
irrespective of whether or not the Bank shall have made any
demand under this Guaranty and although such obligations may
be contingent and unmatured. The rights of the Bank under
this Section 14 are in addition to other rights and remedies
(including, without limitation, other rights of set-off)
which the Bank may have. The right of set-off contained
herein shall not extend to funds of the Guarantor on account
at The Chase Manhattan Bank (National Association), a New
York banking corporation, located at Xxx Xxxxx Xxxxxxxxx
Xxxxx, Xxx Xxxx, Xxx Xxxx 00000.
SECTION 15. Costs, Expenses and Taxes. The
Guarantor agrees to pay, and cause to be paid, on demand
(a) all costs and expenses of the Bank in connection with
the preparation, execution, delivery, modification,
amendment, filing, and recording of this Guaranty and any of
the documents or instruments evidencing the Obligations and
any other agreements or documents delivered in connection
with any of the Obligations, including, without limitation,
the reasonable fees and out-of-pocket expenses of counsel
for the Bank with respect thereto and with respect to
advising the Bank as to its rights and responsibilities
under this Guaranty; (a) all costs and expenses, if any
(including reasonable counsel fees and expenses), in
connection with the enforcement (whether through
negotiations, legal proceedings or otherwise) of this
Guaranty; and (a) all costs and expenses of the Bank in
connection with due diligence, transportation, and
duplication incurred in connection with or reasonably
related to the transactions contemplated hereunder. The
Guarantor agrees to pay interest on any expenses or other
sums due to the Bank hereunder that are not paid when due at
a rate per annum equal to the Highest Lawful Rate. In
addition, the Guarantor shall pay any and all stamp and
other taxes payable or determined to be payable in
connection with the execution and delivery of this Guaranty
and any of the documents or instruments evidencing the
Obligations, and agrees to save the Bank harmless from and
against any and all liabilities with respect to or resulting
from any delay in paying or omission to pay such taxes. The
agreements of the Guarantor contained in this Section shall
survive the payment of all other amounts owing hereunder or
under any of the other Obligations.
SECTION 16. Indemnity. To the fullest extent
permitted by applicable law, the Guarantor agrees to
indemnify, protect and save harmless the Bank from and
against any and all claims, losses, liabilities costs and
expenses of any kind or nature whatsoever, arising out of,
or resulting from (a) this Guaranty, the Credit Agreement,
the Notes, the Loan Documents (including, without
limitation, enforcement of this Guaranty, the Credit
Agreement, the Notes, the Loan Documents), Borrower's
activities in connection with the Guaranty, the Credit
Agreement, the Note, the Loan Documents, or Borrower's
Property, and the actions of any employee, officer,
director, agent, shareholder, invitee, licensee, contractor,
or manager of Borrower or the Bank in connection therewith
(collectively, the "Indemnified Liabilities"), to the extent
that the Indemnified Liabilities arise out of or by reason
of claims made by any Person, including the Bank, except
claims, losses or liabilities resulting from the gross
negligence or willful misconduct of the Bank; provided that
it is the intention of the Guarantor to indemnify the Bank
and parties related to the Bank hereinbefore described
against the consequences of their own negligence.
SECTION 17. Separability. Should any clause,
sentence, paragraph, subsection or Section of this Guaranty
be judicially declared to be invalid, unenforceable or void,
such decision will not have the effect of invalidating or
voiding the remainder of this Guaranty, and the parties
hereto agree that the part or parts of this Guaranty so held
to be invalid, unenforceable or void will be deemed to have
been stricken herefrom and the remainder will have the same
force and effectiveness as if such part or parts had never
been included herein.
SECTION 18. Captions. The captions in this
Guaranty have been inserted for convenience only and shall
be given no substantive meaning or significance whatever in
construing the terms and provisions of this Guaranty.
SECTION 19. Continuing Guaranty; Transfer of Notes.
This Guaranty is a continuing guaranty and shall 0.1 remain
in full force and effect until payment in full of the
Obligations and all other amounts payable under this
Guaranty; 0.1 be binding upon the Guarantor, its successors
and assigns; and 0.1 inure to the benefit of and be
enforceable by the Bank and its respective successors,
transferees and assigns. Without limiting the generality of
the foregoing clause (c), the Bank may assign or otherwise
transfer the Notes to any other Person in accordance with
the terms and provisions set forth in the Credit Agreement,
and such other Person shall thereupon become vested with all
the rights and benefits in respect thereof granted to the
Bank herein or otherwise.
SECTION 20. Confirmation of Release. Upon the
expiration of all time periods during which payments made
pursuant to this Guaranty could be annulled, set aside,
invalidated, declared to be fraudulent or preferential or
otherwise returned, refunded or repaid by the Bank upon the
insolvency, bankruptcy, dissolution, liquidation or
reorganization of the Borrower, and at such time as the
Obligations have been discharged in full, the Bank shall
confirm the discharge of the Guarantor from its obligations
hereunder.
SECTION 21. Limitation by Law. All rights,
remedies and powers provided in this Guaranty may be
exercised only to the extent that the exercise thereof does
not violate any applicable provision of law, and all the
provisions of this Guaranty are intended to be subject to
all applicable mandatory provisions of law which may be
controlling and to be limited to the extent necessary so
that they will not render this Guaranty invalid,
unenforceable, in whole or in part, or not entitled to be
recorded, registered or filed under the provisions of any
applicable law.
SECTION 22. Survival of Representations and
Warranties. All representations and warranties contained in
this Guaranty or made in writing by or on behalf of the
Guarantor in connection herewith, shall survive the
execution and delivery of this Guaranty and shall continue
after the repayment of the Notes and the termination of the
Commitments. Any investigation by the Bank shall not
diminish in any respect whatsoever their right to rely on
such representations and warranties.
SECTION 23. GOVERNING LAW; TERMS. THIS GUARANTY
SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE
LAWS OF THE STATE OF TEXAS AND APPLICABLE FEDERAL LAW. TO
THE EXTENT PERMITTED BY APPLICABLE LAW, THE GUARANTOR HEREBY
SUBMITS TO THE NONEXCLUSIVE JURISDICTION OF THE UNITED
STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT OF TEXAS AND
ANY TEXAS STATE COURT SITTING IN XXXXXX COUNTY, TEXAS FOR
THE PURPOSES OF ALL LEGAL PROCEEDINGS ARISING OUT OF OR
RELATING TO THIS GUARANTY OR THE TRANSACTIONS CONTEMPLATED
HEREBY.
SECTION 24. Definitions. Certain capitalized terms
not otherwise defined herein shall have the respective
meanings set forth in the Credit Agreement. Certain
capitalized terms not otherwise defined herein or in the
Credit Agreement shall have the respective meanings set
forth below:
"Material Adverse Effect" shall mean any material
adverse effect on (a) the financial condition, business,
properties, assets, prospects or operations of the
Guarantor, or (b) the ability of the Guarantor to perform
its obligations under this Guaranty on a timely basis.
"Plan" shall mean any plan subject to Title IV of
ERISA and maintained for employees of the Guarantor or of
any member of a "controlled group of corporations," as such
term is defined in the Code, of which the Guarantor is a
member, or any such plan to which the Guarantor is required
to contribute on behalf of its employees.
THIS GUARANTY, TOGETHER WITH THE OTHER LOAN
DOCUMENTS, REPRESENTS THE FINAL AGREEMENT BETWEEN THE
PARTIES AND MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR,
CONTEMPORANEOUS, OR SUBSEQUENT ORAL AGREEMENTS OF THE
PARTIES.
THERE ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN THE
PARTIES.
IN WITNESS WHEREOF, the Guarantor has caused this
Guaranty to be duly executed by its respective officer
thereunto duly authorized, on the date set forth in the
acknowledgment, to be effective as of the date first above
written.
FREEPORT-McMoRan INC.,
a Delaware corporation
By:
Name:
Title:
Address:
0000 Xxxxxxx Xxxxxx
Xxx Xxxxxxx, Xxxxxxxxx 00000
XXXXX XX XXXXXXXXX
XXXXXX XX XXXXXXX
Xx this ____ day of December, 1996, before me appeared
___________________, to me personally known, who, being by
me duly sworn did say that he is the _________________ of
FREEPORT-McMoRan INC., a Delaware corporation, and that the
seal affixed to said instrument is the corporate seal of
said corporation and that said instrument was signed and
sealed in behalf of said corporation by authority of its
board of directors and said ____________________
acknowledged said instrument to be the free act and deed of
said corporation.
Notary Public, State of Louisiana
(Typed or Printed Name of Notary)
EXHIBIT "F"
FTX GUARANTY
