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U.S. $50,000,000
SECOND AMENDED AND RESTATED CREDIT AGREEMENT,
dated as of September 29, 1999
among
MARKWEST HYDROCARBON, INC.,
as the Borrower,
and
CERTAIN COMMERCIAL LENDING INSTITUTIONS,
as the Lenders,
and
BANK OF AMERICA, N.A.
as the Administrative Agent and the Syndication Agent for the Lenders
--------------------
BANK OF AMERICA SECURITIES LLC,
as Lead Arranger and Sole Book Manager
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TABLE OF CONTENTS
Page
1 DEFINITIONS AND ACCOUNTING TERMS. . . . . . . . . . . . . . . . . . . 2
1.1 Defined Terms . . . . . . . . . . . . . . . . . . . . . . . 2
1.2 Use of Defined Terms. . . . . . . . . . . . . . . . . . . .22
1.3 Cross-References. . . . . . . . . . . . . . . . . . . . . .22
1.4 Accounting and Financial Determinations . . . . . . . . . .22
2 COMMITMENTS, BORROWING PROCEDURES AND NOTES . . . . . . . . . . . . .23
2.1 Commitments . . . . . . . . . . . . . . . . . . . . . . . .23
2.1.1 Revolving Loan Commitment . . . . . . . . . . . . . . . . .23
2.1.2 Commitment to Issue Letters of Credit . . . . . . . . . . .23
2.1.3 Reducing Loan Commitment. . . . . . . . . . . . . . . . . .23
2.1.4 Lenders Not Required To Make Loans or Issue
or Participate in Letters of Credit . . . . . . . . . . . .23
2.2 Reduction of Commitment Amounts . . . . . . . . . . . . . .24
2.2.1 Optional. . . . . . . . . . . . . . . . . . . . . . . . . .24
2.2.2 Mandatory as to Reducing Loans. . . . . . . . . . . . . . .24
2.3 Borrowing Procedure . . . . . . . . . . . . . . . . . . . .24
2.4 Continuation and Conversion Elections . . . . . . . . . . .25
2.5 Funding . . . . . . . . . . . . . . . . . . . . . . . . . .25
2.6 Notes . . . . . . . . . . . . . . . . . . . . . . . . . . .25
2.7 Letters of Credit . . . . . . . . . . . . . . . . . . . . .26
2.7.1 Issuance Requests . . . . . . . . . . . . . . . . . . . . .26
2.7.2 Issuances and Extensions. . . . . . . . . . . . . . . . . .26
2.7.3 [Intentionally Omitted] . . . . . . . . . . . . . . . . . .26
2.7.4 Other Lenders' Participation. . . . . . . . . . . . . . . .27
2.7.5 Disbursements . . . . . . . . . . . . . . . . . . . . . . .27
2.7.6 Reimbursement . . . . . . . . . . . . . . . . . . . . . . .28
2.7.7 Deemed Disbursements. . . . . . . . . . . . . . . . . . . .28
2.7.8 Nature of Reimbursement Obligations . . . . . . . . . . . .29
2.7.9 Increased Costs; Indemnity. . . . . . . . . . . . . . . . .30
3 REPAYMENTS, PREPAYMENTS, INTEREST AND FEES. . . . . . . . . . . . . .31
3.1 Repayments and Prepayments. . . . . . . . . . . . . . . . .31
3.1.1 Optional Prepayment . . . . . . . . . . . . . . . . . . . .31
3.1.2 Mandatory Prepayment on Reducing Loans. . . . . . . . . . .31
3.1.3 Mandatory Prepayment on Acceleration. . . . . . . . . . . .31
3.1.4 Mandatory as to Mandatory Prepayment Ratio. . . . . . . . .32
3.2 Interest Provisions . . . . . . . . . . . . . . . . . . . .32
i
3.2.1 Rates . . . . . . . . . . . . . . . . . . . . . . . . . . .32
3.2.2 Post-Maturity Rates . . . . . . . . . . . . . . . . . . . .32
3.2.3 Payment Dates . . . . . . . . . . . . . . . . . . . . . . .33
3.3 Fees. . . . . . . . . . . . . . . . . . . . . . . . . . . .33
3.3.1 Commitment Fee. . . . . . . . . . . . . . . . . . . . . . .33
3.3.2 Administrative Agent's Fee. . . . . . . . . . . . . . . . .33
3.3.3 Letter of Credit Fees . . . . . . . . . . . . . . . . . . .33
4 CERTAIN LIBO RATE AND OTHER PROVISIONS. . . . . . . . . . . . . . . .34
4.1 Fixed Rate Lending Unlawful . . . . . . . . . . . . . . . .34
4.2 Deposits Unavailable. . . . . . . . . . . . . . . . . . . .34
4.3 Increased LIBO Rate Loan Costs, etc.. . . . . . . . . . . .34
4.4 Funding Losses. . . . . . . . . . . . . . . . . . . . . . .35
4.5 Increased Capital Costs . . . . . . . . . . . . . . . . . .35
4.6 Taxes . . . . . . . . . . . . . . . . . . . . . . . . . . .35
4.7 Payments, Computations, etc.. . . . . . . . . . . . . . . .36
4.8 Sharing of Payments . . . . . . . . . . . . . . . . . . . .37
4.9 Setoff. . . . . . . . . . . . . . . . . . . . . . . . . . .37
4.10 Use of Proceeds . . . . . . . . . . . . . . . . . . . . . .38
5 CONDITIONS TO BORROWING . . . . . . . . . . . . . . . . . . . . . . .38
5.1 Continuation of BMO Loans; Initial Borrowing. . . . . . . .38
5.1.1 Resolutions, etc. . . . . . . . . . . . . . . . . . . . . .38
5.1.2 Delivery of Notes . . . . . . . . . . . . . . . . . . . . .39
5.1.3 Payment of Obligations under Assignment
Agreement and Outstanding Indebtedness, etc.. . . . . . . .39
5.1.4 Guaranty. . . . . . . . . . . . . . . . . . . . . . . . . .39
5.1.5 Pledge Agreement Amendment and
Hydrocarbon Pledge Agreement Amendment. . . . . . . . . . .39
5.1.6 Security Agreement Amendments . . . . . . . . . . . . . . .40
5.1.7 Mortgage Amendments . . . . . . . . . . . . . . . . . . . .40
5.1.8 Opinions of Counsel and Title Policies. . . . . . . . . . .41
5.1.9 Closing Fees, Expenses, etc.. . . . . . . . . . . . . . . .41
5.1.10 Evidence of Insurance . . . . . . . . . . . . . . . . . . .41
5.1.11 Assignment of Key Man Life Insurance
and Business Interruption Insurance . . . . . . . . . . . .41
5.1.12 Projections . . . . . . . . . . . . . . . . . . . . . . . .41
5.1.13 Hedging Policy. . . . . . . . . . . . . . . . . . . . . . .42
5.1.14 Assignment Agreement. . . . . . . . . . . . . . . . . . . .42
5.1.15 MarkWest Michigan Pledge Agreement Amendment
and West Shore Pledge Agreement Amendment . . . . . . . . .42
5.2 Conditions Precedent to Initial Reducing Loan . . . . . . .42
ii
5.2.1 Revolving Loans Paid. . . . . . . . . . . . . . . . . . . .43
5.2.2 Confirmatory Certificate. . . . . . . . . . . . . . . . . .43
5.2.3 Conversion Date Opinion . . . . . . . . . . . . . . . . . .43
5.3 All Borrowings. . . . . . . . . . . . . . . . . . . . . . .43
5.3.1 Compliance with Warranties, No Default, etc.. . . . . . . .43
5.3.2 Borrowing Request . . . . . . . . . . . . . . . . . . . . .44
5.3.3 Satisfactory Legal Form . . . . . . . . . . . . . . . . . .44
6 REPRESENTATIONS AND WARRANTIES. . . . . . . . . . . . . . . . . . . .44
6.1 Organization, etc.. . . . . . . . . . . . . . . . . . . . .45
6.2 Due Authorization, Non-Contravention, etc.. . . . . . . . .45
6.3 Government Approval, Regulation, etc. . . . . . . . . . . .45
6.4 Validity, etc.. . . . . . . . . . . . . . . . . . . . . . .45
6.5 Financial Information . . . . . . . . . . . . . . . . . . .45
6.6 No Material Adverse Change. . . . . . . . . . . . . . . . .46
6.7 Litigation, Labor Controversies, etc. . . . . . . . . . . .46
6.8 Subsidiaries. . . . . . . . . . . . . . . . . . . . . . . .46
6.9 Ownership of Properties . . . . . . . . . . . . . . . . . .46
6.10 Taxes . . . . . . . . . . . . . . . . . . . . . . . . . . .46
6.11 Pension and Welfare Plans . . . . . . . . . . . . . . . . .46
6.12 Compliance with Law . . . . . . . . . . . . . . . . . . . .47
6.13 Claims and Liabilities. . . . . . . . . . . . . . . . . . .47
6.14 No Prohibition on Perfection of Collateral Documents. . . .47
6.15 Solvency. . . . . . . . . . . . . . . . . . . . . . . . . .47
6.16 Environmental Warranties. . . . . . . . . . . . . . . . . .48
6.17 Regulations G, U and X. . . . . . . . . . . . . . . . . . .50
6.18 Accuracy of Information . . . . . . . . . . . . . . . . . .50
6.19 Default . . . . . . . . . . . . . . . . . . . . . . . . . .50
6.20 Year 2000 Problem . . . . . . . . . . . . . . . . . . . . .50
6.21 Xxxxxxx Plant . . . . . . . . . . . . . . . . . . . . . . .51
7 COVENANTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .51
7.1 Affirmative Covenants . . . . . . . . . . . . . . . . . . .51
7.1.1 Financial Information, Reports, Notices, etc. . . . . . . .51
7.1.2 Compliance with Laws, etc.. . . . . . . . . . . . . . . . .54
7.1.3 Maintenance of Properties . . . . . . . . . . . . . . . . .54
7.1.4 Insurance . . . . . . . . . . . . . . . . . . . . . . . . .54
7.1.5 Books and Records . . . . . . . . . . . . . . . . . . . . .55
7.1.6 Environmental Covenant. . . . . . . . . . . . . . . . . . .55
7.1.7 Further Assurances; Additional Collateral . . . . . . . . .56
7.1.8 Compliance with Hedging Policy. . . . . . . . . . . . . . .56
7.1.9 Hedging Agreements. . . . . . . . . . . . . . . . . . . . .56
iii
7.2 Negative Covenants. . . . . . . . . . . . . . . . . . . . .57
7.2.1 Business Activities . . . . . . . . . . . . . . . . . . . .57
7.2.2 Indebtedness. . . . . . . . . . . . . . . . . . . . . . . .57
7.2.3 Liens . . . . . . . . . . . . . . . . . . . . . . . . . . .58
7.2.4 Financial Covenants . . . . . . . . . . . . . . . . . . . .58
7.2.5 Investments . . . . . . . . . . . . . . . . . . . . . . . .59
7.2.6 Restricted Payments, etc. . . . . . . . . . . . . . . . . .59
7.2.7 Rental Obligations. . . . . . . . . . . . . . . . . . . . .60
7.2.8 Consolidation, Merger, etc. . . . . . . . . . . . . . . . .60
7.2.9 Asset Dispositions, etc.. . . . . . . . . . . . . . . . . .60
7.2.10 [Intentionally Omitted] . . . . . . . . . . . . . . . . . .60
7.2.11 Transactions with Affiliates. . . . . . . . . . . . . . . .61
7.2.12 Negative Pledges, Restrictive Agreements, etc.. . . . . . .61
7.2.13 Transfer of Assets. . . . . . . . . . . . . . . . . . . . .61
7.2.14 Acquisitions. . . . . . . . . . . . . . . . . . . . . . . .62
8 EVENTS OF DEFAULT . . . . . . . . . . . . . . . . . . . . . . . . . .62
8.1 Listing of Events of Default. . . . . . . . . . . . . . . .62
8.1.1 Non-Payment of Obligations. . . . . . . . . . . . . . . . .62
8.1.2 Breach of Warranty. . . . . . . . . . . . . . . . . . . . .62
8.1.3 Non-Performance of Certain Covenants and Obligations. . . .62
8.1.4 Non-Performance of Other Covenants and Obligations. . . . .62
8.1.5 Default on Other Indebtedness . . . . . . . . . . . . . . .63
8.1.6 Judgments . . . . . . . . . . . . . . . . . . . . . . . . .63
8.1.7 Pension Plans . . . . . . . . . . . . . . . . . . . . . . .63
8.1.8 Control of the Borrower . . . . . . . . . . . . . . . . . .63
8.1.9 Bankruptcy, Insolvency, etc.. . . . . . . . . . . . . . . .63
8.1.10 Impairment of Security, etc.. . . . . . . . . . . . . . . .64
8.1.11 Default Under Material Agreement. . . . . . . . . . . . . .64
8.1.12 [Intentionally omitted] . . . . . . . . . . . . . . . . . .64
8.1.13 Default on Hedging Obligations pursuant
to Lender Hedging Agreements. . . . . . . . . . . . . . . .64
8.2 Action if Bankruptcy. . . . . . . . . . . . . . . . . . . .65
8.3 Action if Other Event of Default. . . . . . . . . . . . . .65
9 THE AGENTS. . . . . . . . . . . . . . . . . . . . . . . . . . . . . .65
9.1 Actions . . . . . . . . . . . . . . . . . . . . . . . . . .65
9.2 Funding Reliance, etc.. . . . . . . . . . . . . . . . . . .66
9.3 Exculpation . . . . . . . . . . . . . . . . . . . . . . . .66
9.4 Successor . . . . . . . . . . . . . . . . . . . . . . . . .66
9.5 Loans by BofA . . . . . . . . . . . . . . . . . . . . . . .67
9.6 Credit Decisions. . . . . . . . . . . . . . . . . . . . . .67
iv
9.7 Copies, etc.. . . . . . . . . . . . . . . . . . . . . . . .67
9.8 Syndication Agent.. . . . . . . . . . . . . . . . . . . . .68
10 MISCELLANEOUS PROVISIONS. . . . . . . . . . . . . . . . . . . . . . .68
10.1 Waivers, Amendments, etc. . . . . . . . . . . . . . . . . .68
10.2 Notices . . . . . . . . . . . . . . . . . . . . . . . . . .68
10.3 Payment of Costs and Expenses . . . . . . . . . . . . . . .69
10.4 Indemnification . . . . . . . . . . . . . . . . . . . . . .69
10.5 Survival. . . . . . . . . . . . . . . . . . . . . . . . . .70
10.6 Severability. . . . . . . . . . . . . . . . . . . . . . . .70
10.7 Headings. . . . . . . . . . . . . . . . . . . . . . . . . .70
10.8 Execution in Counterparts, Effectiveness, etc.. . . . . . .70
10.9 Governing Law; Entire Agreement . . . . . . . . . . . . . .70
10.10 Successors and Assigns. . . . . . . . . . . . . . . . . . .71
10.11 Sale and Transfer of Loans and Notes;
Participations in Loans and Notes . . . . . . . . . . . . .71
10.11.1 Assignments . . . . . . . . . . . . . . . . . . . . . . . .71
10.11.2 Participations. . . . . . . . . . . . . . . . . . . . . . .72
10.12 Other Transactions. . . . . . . . . . . . . . . . . . . . .73
10.13 Forum Selection and Consent to Jurisdiction . . . . . . . .73
10.14 Waiver of Jury Trial. . . . . . . . . . . . . . . . . . . .73
10.15 Confidentiality . . . . . . . . . . . . . . . . . . . . . .74
10.16 Releases. . . . . . . . . . . . . . . . . . . . . . . . . .74
10.17 Priority of Hedging Obligations . . . . . . . . . . . . . .75
v
SECOND AMENDED AND RESTATED CREDIT AGREEMENT
THIS SECOND AMENDED AND RESTATED CREDIT AGREEMENT, dated as of
September 29, 1999, among MARKWEST HYDROCARBON, INC., a Delaware corporation
(the "BORROWER"), the various financial institutions as are or may become
parties hereto (collectively, the "LENDERS"), and BANK OF AMERICA, N.A.
("BOFA"), as administrative agent and syndication agent for the Lenders (in
such capacity, the "AGENT," the "SYNDICATION AGENT" or the "ADMINISTRATIVE
AGENT").
W I T N E S S E T H:
WHEREAS, the Borrower is engaged in the business of the acquisition,
ownership, operation, leasing, and construction of natural gas processing and
treating plants, fractionation facilities and pipelines and oil and gas
exploration and production, natural gas, natural gas liquids and crude oil
marketing, storage, transportation and terminalling, and activities related
or ancillary to the foregoing;
WHEREAS, the Borrower, certain financial institutions (the "NORWEST
LENDERS"), and Norwest Bank Colorado, National Association, as predecessor to
BofA in its capacity as Administrative Agent, heretofore entered into a
Amended and Restated Working Capital Loan Agreement dated as of October 8,
1996 (such agreement, as so amended, the "WORKING CAPITAL LOAN AGREEMENT")
pursuant to which the Norwest Lenders agreed to make loans (therein referred
to as the "ORIGINAL WORKING CAPITAL LOANS") to the Borrower;
WHEREAS, the Borrower, certain financial institutions (the "NORWEST
LENDERS"), and Norwest Bank Colorado, National Association, as predecessor to
BofA in its capacity as Administrative Agent, heretofore entered into an
Amended and Restated Loan Agreement dated as of October 8, 1996 (such
agreement, as so amended, the "LOAN AGREEMENT") pursuant to which the Norwest
Lenders agreed to make loans (therein referred to as the "ORIGINAL LOANS") to
the Borrower;
WHEREAS, the Borrower, certain financial institutions (the "BMO
LENDERS"), NationsBank, N.A., as syndication agent, and Bank of Montreal
("BMO"), as predecessor to BofA in its capacity as Administrative Agent,
heretofore entered into that certain Amended and Restated Credit Agreement
dated as of June 20, 1997, as amended (such agreement, as so amended, the
"A&R CREDIT AGREEMENT") pursuant to which the Borrower, the BMO Lenders, the
syndication agent and the Administrative Agent restructured the indebtedness
of the Borrower to the Original Lenders pursuant to the Original Loan
Agreement and the Original Working Capital Loan Agreement and amended,
renewed, restated and converted such indebtedness to indebtedness under the
A&R Credit Agreement (the "BMO LOANS") (but shall not be deemed to be repaid);
WHEREAS, the Borrower, the Lenders, the Syndication Agent and the
Administrative Agent intend to restructure the BMO Loans and any other
indebtedness of the Borrower pursuant to the A&R Credit Agreement and agree
that the BMO Loans shall, on the Effective Date, be amended, renewed,
restated and converted into Loans under this Agreement (but shall not be
deemed to be repaid);
WHEREAS, the Borrower, the Lenders and the Administrative Agent hereby
make further amendments to the A&R Credit Agreement and restate the A&R
Credit Agreement in its entirety; and
WHEREAS, the proceeds of Loans and Letters of Credit hereunder will be
used (a) to make payment in full, concurrently with the initial Borrowing
hereunder, of all Indebtedness identified in ITEM 7.2.2(b) ("Indebtedness to
be Paid") of the Disclosure Schedule; and (b) for general corporate purposes
and working capital purposes of the Borrower and its Subsidiaries, including
the businesses and activities described in the first recital and including
capital expenditures, non-hostile acquisitions and letters of credit.
NOW, THEREFORE, the parties hereto agree as follows:
ARTICLE 1
DEFINITIONS AND ACCOUNTING TERMS
SECTION 1.1 DEFINED TERMS. The following terms (whether or not
underscored) when used in this Agreement, including its preamble and
recitals, shall, except where the context otherwise requires, have the
following meanings (such meanings to be equally applicable to the singular
and plural forms thereof):
"A&R CREDIT AGREEMENT" is defined in the FOURTH RECITAL.
"ADMINISTRATIVE AGENT" is defined in the PREAMBLE and includes each
other Person as shall have subsequently been appointed as the successor
Administrative Agent pursuant to SECTION 9.4.
"AFFILIATE" of any Person means any other Person which, directly or
indirectly, controls, is controlled by or is under common control with such
Person (excluding any trustee under, or any committee with responsibility for
administering, any Plan). A Person shall be deemed to be "controlled by" any
other Person if such other Person possesses, directly or indirectly, power
(a) to vote 10% or more of the securities (on a fully diluted basis) having
ordinary voting power for the election of directors or managing general
partners; or (b) to direct or cause the direction of the management and
policies of such Person whether by contract or otherwise.
"AGREEMENT" means, on any date, this Second Amended and Restated
Credit Agreement as originally in effect on the Effective Date and as
thereafter from time to time amended, supplemented, amended and restated, or
otherwise modified and in effect on such date.
"ALTERNATE BASE RATE" means, on any date and with respect to all Base
Rate Loans, a fluctuating rate of interest per annum equal to the higher of
(a) the rate of interest most recently established by BofA at its Domestic
Office as its base rate plus the Base Rate Margin; and (b) the Federal Funds
Rate most recently determined by the Administrative Agent (in accordance with
the definition of Federal Funds Rate) plus 0.5% plus the Base Rate Margin.
The Alternate Base Rate is not necessarily intended to be the lowest rate of
interest determined by the BofA in connection with extensions of credit.
Changes in the rate of interest on that portion of any Loans maintained as
Base Rate Loans will take effect simultaneously with each change in the
Alternate Base Rate. The Administrative Agent will give notice promptly to
the Borrower and the Lenders of changes in the Alternate Base Rate.
"APPLICABLE MARGIN" means, with respect to any Loan of any type or any
Letter of Credit, and at such time as the ratio of Total Funded Debt to
Trailing Twelve Month EBITDA is in one of the following ranges, the number of
basis points ("b.p.") PER ANNUM for the relevant type of Loan, Commitment Fee
or Letter of Credit and the relevant range set forth below:
------------------------------------------------------------------------------
------------------------------------------------------------------------------
Range Applicable Margin
------------------------------------------------------------------------------
Ratio of Total Funded
Debt to Trailing Twelve
Month EBITDA LIBO Rate Letter of Base Rate Commitment
Margin Credit Margin Fee
------------------------------------------------------------------------------
Less than or equal to 100.0 b.p. 100.0 b.p. 0.0 b.p. 25.0 b.p.
1.0X
------------------------------------------------------------------------------
Greater than 1.0X but 125.0 b.p. 125.0 b.p. 0.0 b.p. 25.0 b.p.
less than or equal to
2.0X
------------------------------------------------------------------------------
Greater than 2.0X, but 150.0 b.p. 150.0 b.p. 0.0 b.p. 30.0 b.p.
less than or equal to
3.0X
------------------------------------------------------------------------------
Greater than 3.0X, but 175.0 b.p. 175.0 b.p. 25.0 b.p. 37.5 b.p.
less than or equal to
3.5X
------------------------------------------------------------------------------
Greater than 3.5X, but 200.0 b.p. 200.0 b.p. 50.0 b.p. 50.0 b.p.
less than or equal to
4.0X
------------------------------------------------------------------------------
Greater than 4.0X, but
less
------------------------------------------------------------------------------
------------------------------------------------------------------------------
3
------------------------------------------------------------------------------
------------------------------------------------------------------------------
Range Applicable Margin
------------------------------------------------------------------------------
Ratio of Total Funded
Debt to Trailing Twelve
Month EBITDA LIBO Rate Letter of Base Rate Commitment
Margin Credit Margin Fee
------------------------------------------------------------------------------
than or equal to 5.0X 250.0 b.p. 250.0 b.p. 100.0 b.p. 50.0 b.p.
------------------------------------------------------------------------------
Greater than 5.0X 275.0 b.p. 275.0 b.p. 150.0 b.p. 50.0 b.p.
------------------------------------------------------------------------------
------------------------------------------------------------------------------
The ratio of Total Funded Debt to Trailing Twelve Month EBITDA shall be
determined from the then most recent monthly financial statements delivered
by the Borrower pursuant to Section 7.1.1 and any changes in Applicable
Margin shall become effective the first day of the second month following the
date such financial statements are dated. In the event that the Borrower
shall at any time fail to furnish the Lenders such financial statements
required to be delivered under Section 7.1.1, the maximum Applicable Margin
as set forth above shall apply until such time as such financial statements
are so delivered. Changes in the Applicable Margin as a result of a change in
the ratio of Total Funded Debt to Trailing Twelve Month EBITDA will occur
automatically as aforesaid without notice.
"ASSESSMENT RATE" is defined in SECTION 3.2.1.
"ASSIGNEE LENDER" is defined in SECTION 10.11.1.
"ASSIGNMENT AGREEMENT" is defined in SECTION 5.1.14.
"AUTHORIZED OFFICER" means, relative to any Obligor, those of its
officers whose signatures and incumbency shall have been certified to the
Administrative Agent and the Lenders pursuant to SECTION 5.1.1.
"BASE RATE LOAN" means a Loan bearing interest at a fluctuating rate
determined by reference to the Alternate Base Rate.
"BASE RATE MARGIN" means, on any date, a per annum fee equal to the
Applicable Margin on such date.
"BASIN" means Basin Pipeline L.L.C., a Michigan limited liability
company.
"BASIN MEMORANDUM OF ASSIGNMENT" means that certain Memorandum of
Assignment, dated as of April 15, 1998, between Basin and the Administrative
Agent, as amended, supplemented, restated or otherwise modified from time to
time.
4
"BASIN MORTGAGE" means that certain Mortgage, dated as of April 15,
1998, from Basin to the Administrative Agent, as amended, supplemented,
restated or otherwise modified from time to time.
"BASIN SECURITY AGREEMENT" means that certain Security Agreement,
dated as of April 15, 1998, from Basin to the Administrative Agent, as
amended, supplemented, restated or otherwise modified from time to time.
"BASIN SECURITY AGREEMENT AMENDMENT" means that certain Amendment to
Security Agreement from Basin to the Administrative Agent, substantially in
the form of EXHIBIT V hereto, executed and delivered pursuant to SECTION
5.1.6, as amended, supplemented, restated or otherwise modified from time to
time.
"BMO" is defined in the FOURTH RECITAL.
"BOFA" is defined in the PREAMBLE.
"XXXXXXX MORTGAGE" means the Mortgage, Security Agreement, Assignment
of Profits and Proceeds and Financing Statement (Xxxxxxx) dated as of
November 20, 1992, as amended by the First Amendment to Mortgage, Security
Agreement, Assignment of Profits and Proceeds and Financing Statement
(Xxxxxxx), the Second Amendment to Mortgage, Security Agreement, Assignment
of Profits and Proceeds and Financing Statement (Xxxxxxx) dated as of
September 8, 1995, the Third Amendment to Mortgage, Security Agreement,
Assignment of Profits and Proceeds and Financing Statement (Xxxxxxx) dated as
of May 31, 1996, the Fourth Amendment to Mortgage, Security Agreement,
Assignment of Profits and Proceeds and Financing Statement (Xxxxxxx) dated as
of October 8, 1996, the Fifth Amendment to Mortgage, Security Agreement,
Assignment of Profits and Proceeds and Financing Statement (Xxxxxxx) dated as
of June 20, 1997, the Sixth Amendment to Mortgage, Security Agreement,
Assignment of Profits and Proceeds and Financing Statement (Xxxxxxx) dated as
of April 15, 1998, and any subsequent amendment, supplement or other
modification thereto.
"BORROWER" is defined in the PREAMBLE.
"BORROWING" means the Loans of the same type and, in the case of LIBO
Rate Loans, having the same Interest Period made by all Lenders on the same
Business Day and pursuant to the same Borrowing Request in accordance with
SECTION 2.1.
"BORROWING REQUEST" means a loan request and certificate duly executed
by an Authorized Officer of the Borrower, substantially in the form of
EXHIBIT B hereto.
"BUSINESS DAY" means (a) any day which is neither a Saturday or Sunday
nor a legal holiday on which banks are authorized or required to be closed in
Houston, Texas, Denver,
5
Colorado or New York, New York; and (b) relative to the making, continuing,
prepaying or repaying of any LIBO Rate Loans, any day on which dealings in
Dollars are carried on in the interbank eurodollar market.
"CAPITALIZED LEASE LIABILITIES" means all monetary obligations of the
Borrower or any of its Subsidiaries under any leasing or similar arrangement
which, in accordance with GAAP, would be classified as capitalized leases,
and, for purposes of this Agreement and each other Loan Document, the amount
of such obligations shall be the capitalized amount thereof, determined in
accordance with GAAP, and the stated maturity thereof shall be the date of
the last payment of rent or any other amount due under such lease prior to
the first date upon which such lease may be terminated by the lessee without
payment of a penalty.
"CASH EQUIVALENT INVESTMENT" means, at any time: (a) any evidence of
Indebtedness, maturing not more than one year after such time, issued or
guaranteed by the United States Government; (b) commercial paper, maturing
not more than nine months from the date of issue, which is issued by (i) a
corporation (other than an Affiliate of any Obligor) organized under the laws
of any state of the United States or of the District of Columbia and rated
A-l by Standard & Poor's Corporation or P-l by Xxxxx'x Investors Service,
Inc., or (ii) any Lender (or its holding company); (c) any certificate of
deposit or bankers acceptance, maturing not more than one year after such
time, which is issued by either (i) a commercial banking institution that is
a member of the Federal Reserve System and has a combined capital and surplus
and undivided profits of not less than $250,000,000, or (ii) any Lender or an
Affiliate thereof; (d) any repurchase agreement entered into with any Lender
or an Affiliate thereof (or other commercial banking institution of the
stature referred to in CLAUSE (c)(i)) which (i) is secured by a fully
perfected security interest in any obligation of the type described in any of
CLAUSES (a) through (c); and (ii) has a market value at the time such
repurchase agreement is entered into of not less than 100% of the repurchase
obligation of such Lender or Affiliate (or other commercial banking
institution) thereunder, (e) obligations of any state within the United
States of America, any nonprofit corporation or any instrumentality of the
foregoing, provided that at the time of their purchase, such obligations are
rated in one of the two highest letter rating categories (e.g. in the case of
Standard & Poor's Corporation, either its AAA or AA category) by a nationally
recognized securities credit rating agency, (f) obligations issued by
political subdivisions or municipalities of any state within the United
States of America, any nonprofit corporation or any instrumentality of the
foregoing, that are rated in one of the two highest letter rating categories
(e.g., in the case of Standard & Poor's Corporation, either its AAA or AA
category) by a nationally recognized securities credit rating agency, or (g)
eurodollar deposits with the overseas branch of (i) any commercial banking
institution that is a member of the Federal Reserve System and has a combined
capital and surplus and undivided profits of not less than $250,000,000, or
(ii) any Lender or an Affiliate thereof.
6
"CERCLA" means the Comprehensive Environmental Response, Compensation
and Liability Act of 1980, as amended.
"CERCLIS" means the Comprehensive Environmental Response Compensation
Liability Information System List.
"CHANGE IN CONTROL" means (a) the acquisition by any Person, or two or
more Persons acting in concert (other than Xxxx Xxx and members of his
family), of beneficial ownership (within the meaning of Rule 13d-3 of the
Securities and Exchange Commission under the Securities Exchange Act of 1934)
of 30% or more of the outstanding shares of voting stock of the Borrower; or
(b) the failure of Xxxx Xxx and members of his family to own, free and clear
of all Liens or other encumbrances, at least 30% of the outstanding shares of
voting stock of the Borrower on a fully diluted basis.
"CODE" means the Internal Revenue Code of 1986, as amended, reformed
or otherwise modified from time to time.
"COLLATERAL DOCUMENTS" means each Guaranty, the Pledge Agreement, the
Pledge Agreement Amendment, the Mortgages, the Mortgage Amendments, the
Security Agreement, the Security Agreement Amendment, the West Shore Security
Agreement, the West Shore Security Agreement Amendment, the West Shore Pledge
Agreement, the West Shore Pledge Agreement Amendment, the Basin Security
Agreement, the Basin Security Agreement Amendment, the MarkWest Michigan
Pledge Agreement, the MarkWest Michigan Pledge Agreement Amendment, the
Hydrocarbon Pledge Agreement, the Hydrocarbon Pledge Agreement Amendment, and
all other security agreements, deeds of trust, mortgages, chattel mortgages,
assignments, pledges, guaranties, financing statements, continuation
statements, extension agreements and other agreements or instruments now or
hereafter delivered by Borrower or any Subsidiary of the Borrower to the
Administrative Agent on behalf of the Lenders or to the Lenders in connection
with this Agreement or any transaction contemplated hereby to secure or
guarantee the payment of any part of the Obligations or the performance of
any other duties and obligations of Borrower under the Loan Documents,
whenever made or delivered.
"COMMITMENT" means, as the context may require, a Lender's Reducing
Loan Commitment or Revolving Loan Commitment.
"COMMITMENT AMOUNT" means, as the context may require, either the
Reducing Loan Commitment Amount or the Revolving Loan Commitment Amount.
"COMMITMENT FEE" means, on any date, a per annum fee equal to the
Applicable Margin on such date.
7
"COMMITMENT TERMINATION DATE" means, as the context may require,
either the Reducing Loan Commitment Termination Date or the Revolving Loan
Commitment Termination Date.
"COMMITMENT TERMINATION EVENT" means (a) the occurrence of any Default
described in CLAUSES (a) through (d) of SECTION 8.1.9; or (b) the occurrence
and continuance of any other Event of Default and either (i) the declaration
of the Loans and other Obligations to be due and payable pursuant to SECTION
8.3, or (ii) in the absence of such declaration, the giving of notice by the
Administrative Agent, acting at the direction of the Required Lenders, to the
Borrower that the Commitments have been terminated.
"CONTINGENT LIABILITY" means any agreement, undertaking or arrangement
by which any Person guarantees, endorses or otherwise becomes or is
contingently liable upon (by direct or indirect agreement, contingent or
otherwise, to provide funds for payment, to supply funds to, or otherwise to
invest in, a debtor, or otherwise to assure a creditor against loss) the
indebtedness, obligation or any other liability of any other Person (other
than by endorsements of instruments in the course of collection), or
guarantees the payment of dividends or other distributions upon the shares of
any other Person; PROVIDED, HOWEVER, that notwithstanding the foregoing, the
definition of "Contingent Liability" shall not include any contingent
payments owing by Borrower or any or its Subsidiaries in connection with
Section 2 of the West Shore/Basin Purchase Agreement. The amount of any
Person's obligation under any Contingent Liability shall (subject to any
limitation set forth therein) be deemed to be the outstanding principal
amount (or maximum principal amount, if larger) of the debt, obligation or
other liability guaranteed thereby.
"CONTINUATION/CONVERSION NOTICE" means a notice of continuation or
conversion and certificate duly executed by an Authorized Officer of the
Borrower, substantially in the form of EXHIBIT C hereto.
"CONTROLLED GROUP" means all members of a controlled group of
corporations and all members of a controlled group of trades or businesses
(whether or not incorporated) under common control which, together with the
Borrower, are treated as a single employer under Section 414(b) or 414(c) of
the Code or Section 4001 of ERISA.
"CONVERSION DATE" means the date the initial Reducing Loan is made
pursuant to the terms hereof which shall be December 31, 2001 if a Commitment
Termination Event has not previously occurred.
"CURRENT RATIO" means the ratio of (a) consolidated current assets of
the Borrower and its Subsidiaries TO (b) consolidated current liabilities of
the Borrower and its Subsidiaries, both as determined in accordance with GAAP
(it being understood that only the funded portion, if any, of any reduction
pursuant to SECTION 2.2.2 of the Reducing Loan Commitment Amount will be
deemed to be a current liability for purposes of this definition).
8
"DEFAULT" means any Event of Default or any condition, occurrence or
event which, after notice or lapse of time or both, would constitute an Event
of Default.
"DISCLOSURE SCHEDULE" means the Disclosure Schedule attached hereto as
SCHEDULE I, as it may be amended, supplemented or otherwise modified from
time to time by the Borrower with the written consent of the Administrative
Agent and the Required Lenders.
"DOLLAR" and the sign "$" mean lawful money of the United States.
"DOMESTIC OFFICE" means, relative to any Lender, the office of such
Lender designated as such below its signature hereto or designated in the
Lender Assignment Agreement or such other office of a Lender (or any
successor or assign of such Lender) within the United States as may be
designated from time to time by notice from such Lender, as the case may be,
to each other Person party hereto.
"EBITDA" means net earnings (excluding extraordinary items, gains and
losses on sales and retirement of assets, non-cash write downs and charges
resulting from accounting convention changes) before deduction for federal
and state income taxes, Interest Expense, depreciation, depletion and
amortization expense and other non-cash charges and expenses, including,
without limitation, non-cash charges and expenses relating to Hedging
Agreements, of the Borrower and its Subsidiaries on a consolidated basis, all
determined in accordance with GAAP; PROVIDED, HOWEVER, that for purposes of
calculating the Borrower's EBITDA for the Fiscal Year 1999, the fuel expenses
for the Xxxx processing plant located in Kanawha County, West Virginia for
the Fiscal Year 1997 which were recorded in the Fiscal Year 1998 ($0 for the
months January through August of Fiscal Year 1998, $250,000 for September,
1998, $125,000 for October, 1998, $125,000 for November, 1998, and $125,000
for December, 1998) shall be excluded from such calculation.
"EFFECTIVE DATE" means the date this Agreement becomes effective
pursuant to SECTION 10.8.
"ENVIRONMENTAL LAWS" means all applicable federal, state or local
statutes, laws, ordinances, codes, rules, regulations and guidelines
(including consent decrees and administrative orders) relating to public
health and safety and protection of the environment.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended, and any successor statute of similar import, together with the
regulations thereunder, in each case as in effect from time to time.
References to sections of ERISA also refer to any successor sections.
"EVENT OF DEFAULT" is defined in SECTION 8.1.
9
"FEDERAL FUNDS RATE" means, for any period, a fluctuating interest
rate per annum equal for each day during such period to (a) the weighted
average of the rates on overnight federal funds transactions with members of
the Federal Reserve System arranged by federal funds brokers, as published
for such day (or, if such day is not a Business Day, for the next preceding
Business Day) by the Federal Reserve Bank of New York; or (b) 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 BofA from three
federal funds brokers of recognized standing selected by it.
"FISCAL QUARTER" means any quarter of a Fiscal Year.
"FISCAL YEAR" means any period of twelve consecutive calendar months
ending on December 31; references to a Fiscal Year with a number
corresponding to any calendar year (E.G., the "1997 Fiscal Year") refer to
the Fiscal Year ending on December 31 during such calendar year.
"F.R.S. BOARD" means the Board of Governors of the Federal Reserve
System or any successor thereto.
"GAAP" is defined in SECTION 1.4.
"GUARANTY" means any Guaranty executed and delivered pursuant to
SECTION 5.1.4 or SECTION 7.1.7, substantially in the form of EXHIBIT G
hereto, as amended, supplemented, restated or otherwise modified from time to
time.
"HAZARDOUS MATERIAL" means (a) any "hazardous substance," as defined
by CERCLA; (b) any "hazardous waste," as defined by the Resource Conservation
and Recovery Act, as amended; (c) crude oil or any fraction thereof; or (d)
any pollutant or contaminant or hazardous, dangerous or toxic chemical,
material or substance within the meaning of any other applicable federal,
state or local law, regulation, ordinance or requirement (including consent
decrees and administrative orders) relating to or imposing liability or
standards of conduct concerning any hazardous, toxic or dangerous waste,
substance or material, all as amended or hereafter amended.
"HEDGING AGREEMENT" means any interest rate swap agreements, interest
rate cap agreements, interest rate collar agreements, commodity price
protection agreement, and all other agreements or arrangements designed to
protect such Person against fluctuations in interest rates, or commodity
prices, as any such agreement is amendment, supplemented or otherwise
modified from time to time.
10
"HEDGING COUNTERPARTY" means any Person which is a counterparty to a
Hedging Agreement.
"HEDGING OBLIGATION" means, with respect to any Person, all
liabilities of such Person under any Hedging Agreement.
"HEDGING POLICY" is defined in SECTION 5.1.13.
"HEREIN," "HEREOF," "HERETO," "HEREUNDER" and similar terms contained
in this Agreement or any other Loan Document refer to this Agreement or such
other Loan Document, as the case may be, as a whole and not to any particular
Section, paragraph or provision of this Agreement or such other Loan Document.
"HYDROCARBON PLEDGE AGREEMENT" means that certain Pledge Agreement,
dated as of June 20, 1997, from the Borrower to Administrative Agent, as
amended by the Hydrocarbon Pledge Agreement Amendment, and as further
amended, supplemented, restated or otherwise modified from time to time.
"HYDROCARBON PLEDGE AGREEMENT AMENDMENT" means that certain Amendment
to Pledge Agreement, dated as of the date hereof, from the Borrower to
Administrative Agent, substantially in the form of EXHIBIT W hereto, and
executed and delivered pursuant to SECTION 5.1.5, as amended, supplemented,
restated or otherwise modified from time to time.
"INCLUDING" means including without limiting the generality of any
description preceding such term, and, for purposes of this Agreement and each
other Loan Document, the parties hereto agree that a general statement, which
is followed by or referable to an enumeration of specific matters, shall not
be limited to matters similar to the matters specifically mentioned.
"INDEBTEDNESS" of any Person means, without duplication: (a) all
obligations of such Person for borrowed money and all obligations of such
Person evidenced by bonds, debentures, notes or other similar instruments;
(b) all obligations, contingent or otherwise, relative to the face amount of
all letters of credit, whether or not drawn, and banker's acceptances issued
for the account of such Person; (c) all obligations of such Person as lessee
under leases which have been or should be, in accordance with GAAP, recorded
as Capitalized Lease Liabilities; (d) all other items which, in accordance
with GAAP, would be included as liabilities on the liability side of the
balance sheet of such Person as of the date at which Indebtedness is to be
determined; (e) net liabilities of such Person under all Hedging Obligations;
(f) all obligations of such Person to pay the deferred purchase price of
property or services which have been or should be in accordance with GAAP,
included as liabilities, and indebtedness (excluding prepaid interest
thereon) secured by a Lien on property owned or being purchased by such
Person (including indebtedness arising under conditional sales or other title
retention agreements), whether or not such indebtedness
11
shall have been assumed by such Person except to the extent such indebtedness
is expressly non-recourse to such Person; and (g) all Contingent Liabilities
of such Person in respect of any of the foregoing; PROVIDED, HOWEVER, that
for the purposes of this definition, a production payment or similar
transaction which is non-recourse to such Person shall not constitute
"Indebtedness." For all purposes of this Agreement, the Indebtedness of any
Person shall include the Indebtedness of any partnership or joint venture in
which such Person is a general partner or a joint venturer unless such
Indebtedness is expressly non-recourse to such general partner or joint
venturer.
"INDEMNIFIED LIABILITIES" is defined in SECTION 10.4.
"INDEMNIFIED PARTIES" is defined in SECTION 10.4.
"INSURANCE DEPOSIT ACCOUNT" is defined in SECTION 7.1.4.
"INTEREST PERIOD" means, relative to any LIBO Rate Loans, the period
beginning on (and including) the date on which such LIBO Rate Loan is made or
continued as, or converted into, a LIBO Rate Loan pursuant to SECTION 2.3 or
2.4 and shall end on (but exclude) the day which numerically corresponds to
such date one, two, three or six months thereafter (or, if such month has no
numerically corresponding day, on the last Business Day of such month), in
either case as the Borrower may select in its relevant notice pursuant to
SECTION 2.3 or 2.4; PROVIDED, HOWEVER, that (a) the Borrower shall not be
permitted to select Interest Periods to be in effect at any one time which
have expiration dates occurring on more than five different dates; (b)
Interest Periods commencing on the same date for Loans comprising part of the
same Borrowing shall be of the same duration; (c) if such Interest Period
would otherwise end on a day which is not a Business Day, such Interest
Period shall end on the next following Business Day (unless, if such Interest
Period applies to LIBO Rate Loans, such next following Business Day is the
first Business Day of a calendar month, in which case such Interest Period
shall end on the Business Day next preceding such numerically corresponding
day); and (d) no Interest Period may end later than the Stated Maturity Date,
and the Borrower shall not select Interest Periods for Loans in amounts such
that the Borrower would be obligated to prepay Loans on any date other than
the last day of an Interest Period as a result of the operation of SECTION
2.2.2.
"INVERNESS" means 155 Inverness, Inc., a Colorado corporation.
"INVESTMENT" means, relative to any Person, (a) any loan or advance
made by such Person to any other Person (excluding travel and similar
advances not to exceed $200,000 in the aggregate for all such advances (to
officers and employees made in the ordinary course of business, and
relocation advances made to officers and employees in the ordinary course of
business); (b) any Contingent Liability of such Person; and (c) any ownership
or similar interest held by such Person in any other Person. The amount of
any Investment shall be the original principal or capital amount thereof less
all returns of principal or equity thereon (and without
12
adjustment by reason of the financial condition of such other Person) and
shall, if made by the transfer or exchange of property other than cash, be
deemed to have been made in an original principal or capital amount equal to
the fair market value of such property.
"ISSUANCE REQUEST" means a request and certificate duly executed by
the chief executive, accounting or financial Authorized Officer of the
Borrower, substantially in the form of EXHIBIT H attached hereto (with such
changes thereto as may be agreed upon from time to time by the Administrative
Agent and the Borrower).
"ISSUER" means any affiliate, unit or agency of BofA or any other
Lender which has agreed to issue one or more Letters of Credit at the request
of the Administrative Agent (which shall, at the Borrower's request, notify
the Borrower from time to time of the identity of such other Lender).
"KENOVA MORTGAGE" means the Credit Line Deed of Trust with Security
Agreement, Assignment of Profits and Proceeds and Financing Statement dated
as of November 20, 1992, as amended by the First Amendment to a Credit Line
Deed of Trust with Security Agreement, Assignment of Profits and Proceeds and
Financing Statement dated as of September 14, 1993, the Second Amendment to a
Credit Line Deed of Trust with Security Agreement, Assignment of Profits and
Proceeds and Financing Statement dated as of September 8, 1995, the Third
Amendment to a Credit Line Deed of Trust with Security Agreement, Assignment
of Profits and Proceeds and Financing Statement dated as of May 31, 1996, the
Fourth Amendment to a Credit Line Deed of Trust with Security Agreement,
Assignment of Profits and Proceeds and Financing Statement dated as of
October 8, 1996, the Fifth Amendment to a Credit Line Deed of Trust with
Security Agreement, Assignment of Profits and Proceeds and Financing
Statement dated as of June 20, 1997, the Sixth Amendment to a Credit Line
Deed of Trust with Security Agreement, Assignment of Profits and Proceeds and
Financing Statement dated as of April 15, 1998, and any subsequent amendment,
supplement or other modification thereto.
"LENDER ASSIGNMENT AGREEMENT" means a Lender Assignment Agreement,
substantially in the form of EXHIBIT D hereto.
"LENDER HEDGING AGREEMENT" means any Hedging Agreements entered into
by Borrower or any of its Subsidiaries in which a Lender is the Hedging
Counterparty.
"LENDERS" is defined in the PREAMBLE.
"LETTER OF CREDIT" is defined in SECTION 2.7.
13
"LETTER OF CREDIT COMMITMENT" means, relative to any Lender, such
Lender's obligation to issue (in the case of an Issuer) or participate in (in
the case of all Lenders) Letters of Credit pursuant to SECTION 2.1.2.
"LETTER OF CREDIT OUTSTANDINGS" means, at any time, an amount equal to
the sum of (a) the aggregate Stated Amount at such time of all Letters of
Credit then outstanding and undrawn (as such aggregate Stated Amount shall be
adjusted, from time to time, as a result of drawings, the issuance of Letters
of Credit, or otherwise), PLUS (b) the then aggregate amount of all unpaid
and outstanding Reimbursement Obligations.
"LETTER OF CREDIT SUBLIMIT" is defined in SECTION 2.1.4.
"LIBO RATE" means, relative to any Interest Period for LIBO Rate
Loans, the rate of interest equal to the average (rounded upwards, if
necessary, to the nearest 1/16 of 1%) of the rates per annum at which Dollar
deposits in immediately available funds are offered to BofA's LIBOR Office in
the interbank eurodollar market as at or about 11:00 a.m., Central time, two
Business Days prior to the beginning of such Interest Period for delivery on
the first day of such Interest Period, and in an amount approximately equal
to the amount of BofA's LIBO Rate Loan and for a period approximately equal
to such Interest Period.
"LIBO RATE LOAN" means a Loan bearing interest, at all times during an
Interest Period applicable to such Loan, at a fixed rate of interest
determined by reference to the LIBO Rate (Reserve Adjusted).
"LIBO RATE (RESERVE ADJUSTED)" means, relative to any Loan to be made,
continued or maintained as, or converted into, a LIBO Rate Loan for any
Interest Period, a rate per annum (rounded upwards, if necessary, to the
nearest 1/16 of 1%) determined pursuant to the following formula:
LIBO Rate = LIBO RATE
(Reserve Adjusted) -------------------------
1.00 - LIBOR Reserve Percentage
The LIBO Rate (Reserve Adjusted) for any Interest Period for LIBO Rate
Loans will be determined by the Administrative Agent on the basis of the
LIBOR Reserve Percentage in effect on, and the applicable LIBO Rates
furnished to and received by the Administrative Agent from BofA, two Business
Days before the first day of such Interest Period, SUBJECT, HOWEVER, to the
provisions of SECTION 3.2.4.
"LIBOR OFFICE" means, relative to any Lender, the office of such
Lender designated as such below its signature hereto or designated in the
Lender Assignment Agreement or such other office of a Lender as designated
from time to time by notice from such Lender to the Borrower
14
and the Administrative Agent, whether or not outside the United States, which
shall be making or maintaining LIBO Rate Loans of such Lender hereunder.
"LIBOR RESERVE PERCENTAGE" means, relative to any Interest Period for
LIBO Rate Loans, the reserve percentage (expressed as a decimal) equal to the
maximum aggregate reserve requirements (including all basic, emergency,
supplemental, marginal and other reserves and taking into account any
transitional adjustments or other scheduled changes in reserve requirements)
specified under regulations issued from time to time by the F.R.S. Board and
then applicable to assets or liabilities consisting of and including
"Eurocurrency Liabilities," as currently defined in Regulation D of the
F.R.S. Board, having a term approximately equal or comparable to such
Interest Period.
"LIEN" means any security interest, mortgage, pledge, hypothecation,
assignment, deposit arrangement, encumbrance, lien (statutory or otherwise),
charge against or interest in property to secure payment of a debt or
performance of an obligation or other priority or preferential arrangement of
any kind or nature whatsoever.
"LOAN" means, as the context may require, a Reducing Loan or a
Revolving Loan of any type.
"LOAN AGREEMENT" is defined in the THIRD RECITAL.
"LOAN DOCUMENTS" means this Agreement, the Notes, each of the
Collateral Documents, each Guaranty, each Lender Hedging Agreement, and each
other agreement, document or instrument delivered by the Borrower or any of
its Subsidiaries from time to time in connection with this Agreement and the
Notes.
"MANDATORY PREPAYMENT RATIO" means, on the day on which the
determination is made and after giving pro forma effect to any transaction
occurring on such day (including repayment of Obligations to be made on such
day), the ratio of (a) Borrower's Total Funded Debt to (b) Borrower's EBITDA
for the 12 months most recently ended prior to such day, after adjusting such
EBITDA on a pro forma basis for any assets sold or acquired after the
beginning of such most recently ended 12 months as if such assets had been
sold or acquired at the beginning of such twelve most recently ended months;
PROVIDED, HOWEVER, that the Required Lenders must consent to any pro forma
adjustments made to Borrower's actual historical EBITDA for any asset which
Borrower or any of its Subsidiaries has sold or acquired.
"MARKWEST 401(k) PLAN" means the MarkWest Hydrocarbon, Inc. 401(k)
Savings & Profit Sharing Plan dated April 1, 1988, restated January 1, 1997
and amended November 1, 1998. The purpose of which is to enable eligible
employees to save for retirement and to provide certain benefits in the event
of death, disability, or other termination of employment. The
15
MarkWest 401(k) Plan is for the exclusive benefit of eligible employees of
the Borrower and their beneficiaries.
"MARKWEST MICHIGAN" means MarkWest Michigan, Inc., a Colorado
corporation.
"MARKWEST MICHIGAN PLEDGE AGREEMENT" means that certain Pledge
Agreement, dated as of June 20, 1997, from the Borrower to Administrative
Agent, as amended by that certain Amendment to Pledge Agreement, dated as of
April 15, 1998, as amended, supplemented, restated or otherwise modified from
time to time.
"MARKWEST MICHIGAN PLEDGE AGREEMENT AMENDMENT" means that certain
Second Amendment to Pledge Agreement from MarkWest Michigan to the
Administrative Agent, substantially in the form of EXHIBIT N hereto, executed
and delivered pursuant to SECTION 5.1.15, as amended, supplemented, restated
or otherwise modified from time to time.
"MARKWEST RESOURCES" means MarkWest Resources, Inc., a Colorado
corporation.
"MATERIAL ADVERSE EFFECT" means with respect to any matter that such
matter could reasonably be expected materially and adversely to affect the
assets, business, properties, financial condition of prospects, or results or
operations of the Borrower and its Subsidiaries taken as a whole, or the
ability of the Borrower or any Subsidiary to perform its respective
obligations under any of the Loan Documents.
"MATREX" means Matrex, L.L.C., a Michigan limited liability company.
"MICHIGAN ENERGY COMPANY" means Michigan Energy Company, L.L.C., a
Michigan limited liability company.
"MONTHLY PAYMENT DATE" means the last day of each calendar month or,
if any such day is not a Business Day, the next succeeding Business Day.
"MORTGAGE" means the (i) the Siloam Mortgage, (ii) the Kenova
Mortgage, (iii) the Xxxxxxx Mortgage, (iv) the West Shore Mortgage, (v) the
Basin Mortgage, (vi) the West Shore Memorandum of Assignment and (vii) the
Basin Memorandum of Assignment, or any of them.
"MORTGAGE AMENDMENTS" means (i) that certain Seventh Amendment to
Mortgage, Security Agreement and Assignment of Profits and Proceeds and
Financing Statement (Siloam), dated as of the date hereof and substantially
in the form of EXHIBIT K hereto, amending the Siloam Mortgage, (ii) that
certain Seventh Amendment to Mortgage, Security Agreement and Assignment of
Profits and Proceeds and Financing Statement (Xxxxxxx), dated as of the date
hereof and substantially in the form of EXHIBIT J hereto, amending the
Xxxxxxx Mortgage,
16
(iii) that certain Sixth Amendment to Credit Line Deed of Trust with Security
Agreement, Assignment of Profits and Proceeds and Financing Statement, dated
as of the date hereof and substantially in the form of EXHIBIT L hereto,
amending the Kenova Mortgage, (iv) that certain First Amendment to Mortgage,
dated as of the date hereof and substantially in the form of EXHIBIT U
hereto, amending the Basin Mortgage, (v) that certain First Amendment to
Mortgage, dated as of the date hereof and substantially in the form of
EXHIBIT R hereto, amending the West Shore Mortgage, (vi) that certain First
Amendment to Memorandum of Assignment, dated as of the date hereof and
substantially in the form of EXHIBIT Y hereto, amending the Basin Memorandum
of Assignment, and (vii) that certain First Amendment to Memorandum of
Assignment, dated as of the date hereof and substantially in the form of
EXHIBIT Z hereto, amending the West Shore Memorandum of Assignment, in each
case executed and delivered pursuant to SECTION 5.1.8 and as amended,
supplemented, restated or otherwise modified from time to time.
"NOTE" means a promissory note of the Borrower payable to any Lender,
in substantially the form of EXHIBIT A hereto (as such promissory note may be
amended, endorsed or otherwise modified from time to time), evidencing the
aggregate Obligations of the Borrower to such Lender resulting from
outstanding Revolving Loans or Reducing Loans or Reimbursement Obligations,
and also means all other promissory notes accepted from time to time in
substitution therefor or renewal thereof.
"OBLIGATIONS" means all obligations (monetary or otherwise) of the
Borrower and each other Obligor arising under or in connection with this
Agreement, the Notes, the Reimbursement Obligations and each other Loan
Document.
"OBLIGOR" means the Borrower or any other Person (other than the
Administrative Agent or any Lender) obligated under any Loan Document.
"ORGANIC DOCUMENT" means, relative to any Obligor, its certificate of
incorporation, its by-laws and all shareholder agreements, voting trusts and
similar arrangements applicable to any of its authorized shares of capital
stock.
"PARTICIPANT" is defined in SECTION 10.11.
"PBGC" means the Pension Benefit Guaranty Corporation and any entity
succeeding to any or all of its functions under ERISA.
"PENSION PLAN" means a "pension plan," as such term is defined in
section 3(2) of ERISA, which is subject to Title IV of ERISA (other than a
multiemployer plan as defined in section 4001(a)(3) of ERISA), and to which
the Borrower or any corporation, trade or business that is, along with the
Borrower, a member of a Controlled Group, may have liability, including
17
any liability by reason of having been a substantial employer within the
meaning of section 4063 of ERISA at any time during the preceding five years,
or by reason of being deemed to be a contributing sponsor under section 4069
of ERISA.
"PERCENTAGE" means, relative to any Lender, the percentage set forth
opposite its signature to this Agreement or set forth in a Lender Assignment
Agreement, as such percentage may be adjusted from time to time pursuant to
Lender Assignment Agreement(s) executed by such Lender and its Assignee
Lender(s) and delivered pursuant to SECTION 10.11; provided, the sum of all
Percentages for all Lenders shall never be less than 100%.
"PERSON" means any natural person, corporation, partnership, firm,
association, trust, government, governmental agency or any other entity,
whether acting in an individual, fiduciary or other capacity.
"PLAN" means any Pension Plan or Welfare Plan.
"PLEDGE AGREEMENT" means that certain General Security and Pledge,
dated as of October 8, 1996, in favor of Norwest Bank Colorado, National
Association, as secured party, as amended by that certain Amendment to
General Security Agreement and Pledge, dated as of June 20, 1997 and as
further amended supplemented, restated or otherwise modified from time to
time.
"PLEDGE AGREEMENT AMENDMENT" means that certain Second Amendment to
General Security Agreement and Pledge, dated as of the date hereof, from the
Borrower to Administrative Agent, substantially in the form of EXHIBIT M
hereto, and executed and delivered pursuant to SECTION 5.1.5, as amended,
supplemented, restated or otherwise modified from time to time.
"QUARTERLY PAYMENT DATE" means the last day of each March, June,
September, and December or, if any such day is not a Business Day, the next
succeeding Business Day.
"REDUCING LOAN" is defined in SECTION 2.1.3.
"REDUCING LOAN COMMITMENT" means, relative to any Lender, such
Lender's obligation to make Reducing Loans pursuant to SECTION 2.1.3.
"REDUCING LOAN COMMITMENT AMOUNT" means an amount equal to the lesser
of (i) $50,000,000 or (ii) the aggregate amount of Revolving Loans
outstanding on the Conversion Date, as such amount may be reduced from time
to time pursuant to SECTION 2.2.
"REDUCING LOAN COMMITMENT TERMINATION DATE" means the earliest of (a)
December 31, 2005; (b) the date on which the Reducing Loan Commitment Amount
is terminated in full or
18
reduced to zero pursuant to SECTION 2.2; and (c) the date on which any
Commitment Termination Event occurs. Upon the occurrence of any event
described in CLAUSE (b) or (c), the Revolving Loan Commitments shall
terminate automatically and without any further action.
"RELEASE" means a "release," as such term is defined in CERCLA.
"REQUIRED LENDERS" means, at any time, the Administrative Agent and
Lenders holding at least 66% of the then aggregate outstanding principal
amount of the Notes then held by the Lenders, or, if no such principal amount
is then outstanding, the Administrative Agent and Lenders having at least 66%
of the Commitments.
"RESOURCE CONSERVATION AND RECOVERY ACT" means the Resource
Conservation and Recovery Act, 42 U.S.C. Section 690, ET SEQ., as in effect
from time to time.
"REVOLVING LOAN" is defined in SECTION 2.1.1.
"REVOLVING LOAN COMMITMENT" means, relative to any Lender, such
Lender's obligation to continue the Original Loans as Revolving Loans and to
make subsequent Revolving Loans pursuant to SECTION 2.1.1.
"REVOLVING LOAN COMMITMENT AMOUNT" means, on any date, $50,000,000, as
such amount may be reduced from time to time pursuant to SECTION 2.2.
"REVOLVING LOAN COMMITMENT TERMINATION DATE" means the earliest of (a)
December 31, 2001; (b) the date on which the Revolving Loan Commitment Amount
is terminated in full or reduced to zero pursuant to SECTION 2.2; and (c) the
date on which any Commitment Termination Event occurs. Upon the occurrence
of any event described in CLAUSE (b) or (c), the Revolving Loan Commitments
shall terminate automatically and without any further action.
"REIMBURSEMENT OBLIGATION" is defined in SECTION 2.7.6.
"SECURITY AGREEMENT" means that certain Security Agreement, dated as
of November 20, 1992, as previously amended by (i) that certain First
Amendment to Security Agreement, dated as of May 31, 1996, (ii) that certain
Second Amendment to Security Agreement, dated as of October 8, 1996, and
(iii) that certain Third Amendment to Security Agreement, dated as of June
20, 1997, as amended, supplemented, restated or otherwise modified from time
to time.
"SECURITY AGREEMENT AMENDMENT" means the Fourth Amendment to Security
Agreement executed and delivered pursuant to SECTION 5.1.6, substantially in
the form of EXHIBIT O hereto, as amended, supplemented, restated or otherwise
modified from time to time.
19
"SILOAM MORTGAGE" means the Mortgage, Security Agreement and
Assignment of Profits and Proceeds (Siloam) dated as of November 20, 1992, as
amended by the First Amendment to Mortgage, Security Agreement, Assignment of
Profits and Proceeds and Financing Statement (Siloam) dated as of September
14, 1993, the Second Amendment to Mortgage, Security Agreement, Assignment of
Profits and Proceeds and Financing Statement (Siloam) dated as of September
8, 1995, the Third Amendment to Mortgage, Security Agreement, Assignment of
Profits and Proceeds and Financing Statement (Siloam) dated as of May 31,
1996, the Fourth Amendment to Mortgage, Security Agreement, Assignment of
Profits and Proceeds and Financing Statement (Siloam) dated as of October 8,
1996, the Fifth Amendment to Mortgage, Security Agreement, Assignment of
Profits and Proceeds and Financing Statement (Siloam) dated as of June 20,
1997, the Sixth Amendment to Mortgage, Security Agreement, Assignment of
Profits and Proceeds and Financing Statement (Siloam) dated as of April 15,
1998, and any subsequent amendment, supplement or other modification thereto.
"STATED AMOUNT" of each Letter of Credit means the face amount of such
Letter of Credit as such amount is in effect on the issuance date thereof.
"STATED EXPIRY DATE" is defined in SECTION 4.1.
"STATED MATURITY DATE" means (a) in the case of any Revolving Loan,
December 31, 2001, (b) in the case of any Letter of Credit, December 31, 2005
and (c) in the case of any Reducing Loan, December 31, 2005.
"SUBORDINATED DEBT" means all unsecured Indebtedness of the Borrower
for money borrowed which is subordinated, upon terms satisfactory to the
Administrative Agent and the Required Lenders, in right of payment to the
payment in full in cash of all Obligations.
"SUBSIDIARY" means, with respect to any Person, any corporation of
which more than 50% of the outstanding capital stock having ordinary voting
power to elect a majority of the board of directors of such corporation
(irrespective of whether at the time capital stock of any other class or
classes of such corporation shall or might have voting power upon the
occurrence of any contingency) is at the time directly or indirectly owned by
such Person, by such Person and one or more other Subsidiaries of such
Person, or by one or more other Subsidiaries of such Person.
"TANGIBLE NET WORTH" means the consolidated net worth of the Borrower
and its Subsidiaries after subtracting therefrom the aggregate amount of any
intangible assets of the Borrower and its Subsidiaries, including goodwill,
franchises, licenses, patents, trademarks, trade names, copyrights, service
marks and brand names; provided that for purposes of this definition,
xxxx-to-market adjustments relating to commodity xxxxxx required to be made
under GAAP shall be excluded for purposes of determining consolidated net
worth.
20
"TAXES" is defined in SECTION 4.6.
"TOTAL FUNDED DEBT" means the outstanding principal amount of all
Indebtedness of the Borrower and its Subsidiaries of the nature referred to
in CLAUSES (a), (b), (c) and (f) of the definition of "INDEBTEDNESS";
PROVIDED, HOWEVER, in the event that Borrower's "working capital" (determined
in accordance with GAAP) is greater than $0 for any time period used to
calculate the Borrower's Total Funded Debt, then Total Funded Debt for such
time period shall equal the outstanding principal amount of all Indebtedness
of the Borrower and its Subsidiaries of the nature referred to in CLAUSES
(a), (b), (c) and (f) of the definition of "INDEBTEDNESS" LESS cash on hand
or Cash Equivalent Investment which are free and clear of all Liens.
"TRAILING TWELVE MONTH EBITDA" means, at the end of any month, the
EBITDA of the Borrower and its Subsidiaries on a consolidated basis for the
12 months ending on the last day of such month.
"TYPE" means, relative to any Loan, the portion thereof, if any, being
maintained as a Base Rate Loan or a LIBO Rate Loan.
"U.C.C." means the Uniform Commercial Code, as in effect in the State
of New York.
"UNITED STATES" or "U.S." means the United States of America, its
fifty States and the District of Columbia.
"WELFARE PLAN" means a "welfare plan," as such term is defined in
section 3(1) of ERISA.
"WEST SHORE" means West Shore Processing Company, L.L.C., a Michigan
limited liability company.
"WEST SHORE MEMORANDUM OF ASSIGNMENT" means that certain Memorandum of
Assignment, dated as of April 15, 1998, between West Shore and the
Administrative Agent, as amended, supplemented, restated or otherwise
modified from time to time.
"WEST SHORE/BASIN PURCHASE AGREEMENT" means that certain Purchase and
Sale Agreement, dated as of November 21, 1997, between Michigan Energy
Company and MarkWest Michigan.
"WEST SHORE MORTGAGE" means that certain Mortgage, dated as of April
15, 1998, from West Shore to the Administrative Agent, as amended,
supplemented, restated or otherwise modified from time to time.
21
"WEST SHORE PLEDGE AGREEMENT" means that certain Pledge Agreement (LLC
Interests), dated as of April 15, 1998, from West Shore to the Administrative
Agent as amended, supplemented, restated or otherwise modified from time to
time.
"WEST SHORE PLEDGE AGREEMENT AMENDMENT" means that certain Amendment
to Pledge Agreement from West Shore to the Administrative Agent,
substantially in the form of EXHIBIT S hereto, executed and delivered
pursuant to SECTION 5.1.15, as amended, supplemented, restated or otherwise
modified from time to time.
"WEST SHORE SECURITY AGREEMENT" means that certain Security Agreement,
dated as of April 15, 1998, from West Shore to the Administrative Agent, as
amended, supplemented, restated or otherwise modified from time to time.
"WEST SHORE SECURITY AGREEMENT AMENDMENT" means that certain Amendment
to Security Agreement from West Shore to the Administrative Agent,
substantially in the form of EXHIBIT T hereto, executed and delivered
pursuant to SECTION 5.1.6, as amended, supplemented, restated or otherwise
modified from time to time.
"WORKING CAPITAL LOAN AGREEMENT" is defined in the SECOND RECITAL.
"YEAR 2000 COMPLIANCE" is defined in SECTION 7.1.10.
"YEAR 2000 PROBLEM" is defined in SECTION 6.20.
SECTION 1.2 USE OF DEFINED TERMS. Unless otherwise defined or the
context otherwise requires, terms for which meanings are provided in this
Agreement shall have such meanings when used in the Disclosure Schedule and
in each Note, Borrowing Request, Continuation/Conversion Notice, Loan
Document, notice and other communication delivered from time to time in
connection with this Agreement or any other Loan Document.
SECTION 1.3 CROSS-REFERENCES. Unless otherwise specified,
references in this Agreement and in each other Loan Document to any Article
or Section are references to such Article or Section of this Agreement or
such other Loan Document, as the case may be, and, unless otherwise
specified, references in any Article, Section or definition to any clause are
references to such clause of such Article, Section or definition.
SECTION 1.4 ACCOUNTING AND FINANCIAL DETERMINATIONS. Unless
otherwise specified, all accounting terms used herein or in any other Loan
Document shall be interpreted, all accounting determinations and computations
hereunder or thereunder (including under SECTION 7.2.4) shall be made, and
all financial statements required to be delivered hereunder or
22
thereunder shall be prepared in accordance with, those generally accepted
accounting principles ("GAAP") applied in the preparation of the financial
statements referred to in SECTION 6.5.
ARTICLE 2
COMMITMENTS, BORROWING PROCEDURES AND NOTES
SECTION 2.1 COMMITMENTS. On the terms and subject to the
conditions of this Agreement (including ARTICLE 5), each Lender severally, to
the extent of its Percentage, agrees to make Loans pursuant to the
Commitments described in this SECTION 2.1.
SECTION 2.1.1 REVOLVING LOAN COMMITMENT. On the Effective Date, all
outstanding Original Loans shall be amended, renewed, restated, extended and
converted (but shall not be deemed to be repaid) to Revolving Loans under
this Agreement. From time to time on any Business Day occurring prior to the
Commitment Termination Date each Lender agrees to make loans (relative to
such Lender, its "REVOLVING LOANS") to the Borrower equal to such Lender's
Percentage of the aggregate amount of the Borrowing of Loans requested by the
Borrower to be made on such day. On the terms and subject to the conditions
hereof, the Borrower may from time to time borrow, prepay and reborrow
Revolving Loans.
SECTION 2.1.2 COMMITMENT TO ISSUE LETTERS OF CREDIT. From time to
time on any Business Day prior to the Commitment Termination Date, each
Issuer will issue, and each Lender will participate in, to the extent of each
Lender's Percentage, the Letters of Credit, in accordance with the terms of
SECTION 2.7.
SECTION 2.1.3 REDUCING LOAN COMMITMENT. Subject to the terms and
conditions hereof, on the Conversion Date each Lender will make a Reducing
Loan to the Borrower in the amount equal to such Lender's Percentage of the
amounts outstanding on the Conversion Date under the Revolving Loans, or such
lesser amount as requested by Borrower by converting Revolving Loans to
Reducing Loans (which conversion shall be deemed automatically to have
occurred upon satisfaction of such conditions). From time to time on any
Business Day occurring prior to the Reducing Loan Commitment Termination
Date, each Lender will make Loans (relative to such Lender, its "REDUCING
LOANS") to the Borrower equal to such Lender's Percentage of the aggregate
amount of the Borrowing of Reducing Loans requested by the Borrower to be
made on such day. The Commitment of each Lender described in this SECTION
2.1.3 is herein referred to as its "REDUCING LOAN COMMITMENT." On the terms
and subject to the conditions hereof, the Borrower may from time to time
borrow, prepay and reborrow Reducing Loans.
SECTION 2.1.4 LENDERS NOT REQUIRED TO MAKE LOANS OR ISSUE OR
PARTICIPATE IN LETTERS OF CREDIT. No Lender shall be permitted or required
to (a) continue any BMO Loan as a Loan hereunder or to make any Revolving
Loan if, after giving effect thereto (i) the aggregate
23
outstanding principal amount of all Revolving Loans of all Lenders, together
with all Letter of Credit Outstandings, would exceed the Revolving Loan
Commitment Amount, or (ii) the aggregate outstanding principal amount of all
Revolving Loans of such Lender, together with its Percentage of all Letter of
Credit Outstandings, would exceed such Lender's Percentage of the Revolving
Commitment Amount, or (b) make any Reducing Loan if, after giving effect
thereto, the aggregate outstanding principal amount of all Reducing Loans,
together with all Letter of Credit Outstandings, (i) of all Lenders would
exceed the Reducing Loan Commitment Amount, or (ii) of such Lender would
exceed such Lender's Percentage of the Reducing Loan Commitment Amount, or
(c) issue (in the case of any Issuer) or participate in (in the case of each
Lender) any Letter of Credit if, after giving effect thereto (i) all Letter
of Credit Outstandings together with the aggregate outstanding principal
amount of all Loans of all Lenders would exceed the Commitment Amount, or
(ii) such Lender's Percentage of all Letter of Credit Outstandings together
with the aggregate outstanding principal amount of all Loans of such Lender
would exceed such Lender's Percentage of the Commitment Amount, or (iii) all
Letter of Credit Outstandings would exceed $10,000,000 (the "LETTER OF CREDIT
SUBLIMIT").
SECTION 2.2 REDUCTION OF COMMITMENT AMOUNTS. The Commitment
Amounts are subject to reduction from time to time pursuant to this SECTION
2.2.
SECTION 2.2.1 OPTIONAL. The Borrower may, from time to time on any
Business Day, voluntarily reduce the Commitment Amount; PROVIDED, HOWEVER,
that all such reductions shall require at least three Business Days' prior
notice to the Administrative Agent and be permanent, and any partial
reduction of any Commitment Amount shall be in a minimum amount of $2,500,000
and in an integral multiple of $500,000.
SECTION 2.2.2 MANDATORY AS TO REDUCING LOANS. The Reducing Loan
Commitment Amount shall, without any further action, automatically and
permanently be reduced on the last day of each fiscal quarter following the
Revolving Loan Commitment Termination Date by an amount equal to
one-sixteenth of the aggregate Revolving Loan Commitment Amount in effect on
the Conversion Date; PROVIDED, HOWEVER, that on the Stated Maturity Date, the
Reducing Loan Commitment Amount shall be zero. Voluntary reductions of the
Reducing Loan Commitment Amount made pursuant to SECTION 2.2.1 shall be
applied to diminish the amount of scheduled reductions to such Commitment
Amount thereafter becoming effective pursuant to this Section pro rata.
SECTION 2.3 BORROWING PROCEDURE. By delivering a Borrowing
Request to the Administrative Agent on or before 10:00 a.m., Central time, on
a Business Day, the Borrower may from time to time irrevocably request, (i)
on not less than three nor more than five Business Days' notice, a LIBO Rate
Loan or (ii) on not less than the same day or more than five Business Days'
notice, a Base Rate Loan, in a minimum amount of $500,000 and an integral
multiple of $500,000, or in the unused amount of the applicable Commitment,
if less. On the terms and
24
subject to the conditions of this Agreement, each Borrowing shall be
comprised of the type of Loans, and shall be made on the Business Day
specified in such Borrowing Request. On or before 11:00 a.m., Central time,
on such specified Business Day each Lender shall deposit with the
Administrative Agent same day funds in an amount equal to such Lender's
Percentage of the requested Borrowing.
Such deposit will be made to an account which the Administrative Agent shall
specify from time to time by notice to the Lenders. To the extent funds are
received from the Lenders, the Administrative Agent shall make such funds
available to the Borrower by wire transfer to the accounts the Borrower shall
have specified in its Borrowing Request. No Lender's obligation to make any
Loan shall be affected by any other Lender's failure to make any Loan.
SECTION 2.4 CONTINUATION AND CONVERSION ELECTIONS. By delivering
a Continuation/Conversion Notice to the Administrative Agent on or before
10:00 a.m., Central time, on a Business Day, the Borrower may from time to
time irrevocably elect,(i) on not less than three nor more than five Business
Days' notice, in connection with any LIBO Rate Loan or (ii) on not less than
three or more than five Business Days' notice, in connection with any Base
Rate Loan, that all, or any portion in an aggregate minimum amount of
$500,000 and an integral multiple of $500,000, of any Loans be, in the case
of Base Rate Loans, converted into LIBO Rate Loans or, in the case of LIBO
Rate Loans, be converted into a Base Rate Loan or continued as a LIBO Rate
Loan (in the absence of delivery of a Continuation/ Conversion Notice with
respect to any LIBO Rate Loan at least three Business Days before the last
day of the then current Interest Period with respect thereto, such LIBO Rate
Loan shall, on such last day, automatically convert to a Base Rate Loan);
PROVIDED, HOWEVER, that (i) each such conversion or continuation shall be pro
rated among the applicable outstanding Loans of all Lenders, and (ii) no
portion of the outstanding principal amount of any Loans may be continued as,
or be converted into, LIBO Rate Loans when any Default has occurred and is
continuing.
SECTION 2.5 FUNDING. Each Lender may, if it so elects, fulfill
its obligation to make, continue or convert LIBO Rate Loans hereunder by
causing one of its foreign branches or Affiliates (or an international
banking facility created by such Lender) to make or maintain such LIBO Rate
Loan; PROVIDED, HOWEVER, that such LIBO Rate Loan shall nonetheless be deemed
to have been made and to be held by such Lender, and the obligation of the
Borrower to repay such LIBO Rate Loan shall nevertheless be to such Lender
for the account of such foreign branch, Affiliate or international banking
facility. In addition, the Borrower hereby consents and agrees that, for
purposes of any determination to be made for purposes of SECTIONS 4.1, 4.2,
4.3 or 4.4, it shall be conclusively assumed that each Lender elected to fund
all LIBO Rate Loans by purchasing Dollar deposits in its LIBOR Office's
interbank eurodollar market.
SECTION 2.6 NOTES. Each Lender's Revolving Loans under a Revolving
Loan Commitment and Reducing Loans under a Reducing Loan Commitment shall be
evidenced by a Note payable to the order of such Lender in a maximum
principal amount equal to such Lender's Percentage of the original applicable
Commitment Amount. The Borrower hereby irrevocably
25
authorizes each Lender to make (or cause to be made) appropriate notations on
the grid attached to such Lender's Note (or on any continuation of such
grid), which notations, if made, shall evidence, among other things, the date
of, the outstanding principal of, and the interest rate and Interest Period
applicable to the Loans evidenced thereby. Such notations shall be rebuttable
presumptive evidence of such amounts; PROVIDED HOWEVER, that the failure of
any Lender to make any such notations shall not limit, enlarge or otherwise
affect any Obligations of the Borrower or any other Obligor.
SECTION 2.7 LETTERS OF CREDIT.
SECTION 2.7.1 ISSUANCE REQUESTS. By delivering to the
Administrative Agent and the applicable Issuer an Issuance Request on or
before 11:30 a.m., Central time, the Borrower may request, from time to time
prior to the Commitment Termination Date and on not less than three nor more
than ten Business Days' notice, that such Issuer issue an irrevocable standby
letter of credit in such form as may be mutually agreed to by the Borrower
and such Issuer (each a "LETTER OF CREDIT"), in support of financial
obligations of the Borrower incurred in the Borrower's ordinary course of
business and which are described in such Issuance Request. Upon receipt of
an Issuance Request, the Administrative Agent shall promptly notify the
Lenders thereof. Each Letter of Credit shall by its terms: (a) be issued in
a Stated Amount which (i) together with all Letter of Credit Outstandings
does not exceed the Letter of Credit Sublimit, or (ii) together with all
Letter of Credit Outstandings and all outstanding Loans does not exceed (or
would not exceed) the then Commitment Amount (as such amount is reduced and
is scheduled to reduce pursuant to Section 2.2); and (b) be stated to expire
on a date (its "STATED EXPIRY DATE") no later than the earlier (i) of one
year from its date of issuance and (ii) the Commitment Termination Date. So
long as no Default has occurred and is continuing, by delivery to the
applicable Issuer and the Administrative Agent of an Issuance Request at
least three but not more than ten Business Days prior to the Stated Expiry
Date of any Letter of Credit, the Borrower may request such Issuer to extend
the Stated Expiry Date of such Letter of Credit for an additional period not
to exceed the earlier of one year from its date of extension and the Reducing
Loan Commitment Termination Date.
SECTION 2.7.2 ISSUANCES AND EXTENSIONS. On the terms and subject to
the conditions of this Agreement (including ARTICLE 5), the Issuer shall
issue Letters of Credit, and extend the Stated Expiry Dates of outstanding
Letters of Credit, in accordance with the Issuance Requests made therefor.
Each Issuer will make available the original of each Letter of Credit which
it issues in accordance with the Issuance Request therefor to the beneficiary
thereof (and will promptly provide each of the Lenders and the Borrower with
a copy of such Letter of Credit) and will notify the beneficiary under any
Letter of Credit of any extension of the Stated Expiry Date thereof.
SECTION 2.7.3 [INTENTIONALLY OMITTED].
26
SECTION 2.7.4 OTHER LENDERS' PARTICIPATION. Each Letter of Credit
issued pursuant to SECTION 2.7.2 shall, effective upon its issuance and
without further action, be issued on behalf of all Lenders (including the
Issuer thereof) PRO RATA according to their respective Percentages. Each
Lender shall, to the extent of its Percentage, be deemed irrevocably to have
participated in the issuance of such Letter of Credit and shall be
responsible to reimburse promptly the Issuer thereof for Reimbursement
Obligations which have not been reimbursed by the Borrower in accordance with
SECTION 2.7.5, or which have been reimbursed by the Borrower but must be
returned, restored or disgorged by such Issuer for any reason, and each
Lender shall, to the extent of its Percentage, be entitled to receive from
the Administrative Agent a ratable portion of the letter of credit fees
received by the Administrative Agent pursuant to SECTION 3.3.3, with respect
to each Letter of Credit. In the event that the Borrower shall fail to
reimburse any Issuer, or if for any reason Loans shall not be made to fund
any Reimbursement Obligation, all as provided in SECTION 2.7.5 and in an
amount equal to the amount of any drawing honored by such Issuer under a
Letter of Credit issued by it, or in the event such Issuer must for any
reason return or disgorge such reimbursement, such Issuer shall promptly
notify each Lender of the unreimbursed amount of such drawing and of such
Lender's respective participation therein. Each Lender shall make available
to such Issuer, whether or not any Default shall have occurred and be
continuing, an amount equal to its respective participation in same day or
immediately available funds at the office of such Issuer specified in such
notice not later than 11:30 a.m., Central time, on the Business Day (under
the laws of the jurisdiction of such Issuer) after the date notified by such
Issuer. In the event that any Lender fails to make available to such Issuer
the amount of such Lender's participation in such Letter of Credit as
provided herein, such Issuer shall be entitled to recover such amount on
demand from such Lender together with interest at the daily average Federal
Funds Rate for three Business Days (together with such other compensatory
amounts as may be required to be paid by such Lender to the Administrative
Agent pursuant to the Rules for Interbank Compensation of the council on
International Banking or the Clearinghouse Compensation Committee, as the
case may be, as in effect from time to time) and thereafter at the Alternate
Base Rate LESS the Base Rate Margin PLUS 2%. Nothing in this Section shall
be deemed to prejudice the right of any Lender to recover from any Issuer any
amounts made available by such Lender to such Issuer pursuant to this Section
in the event that it is determined by a court of competent jurisdiction that
the payment with respect to a Letter of Credit by such Issuer in respect of
which payment was made by such Lender constituted gross negligence or wilful
misconduct on the part of such Issuer. Each Issuer shall distribute to each
other Lender which has paid all amounts payable by it under this Section with
respect to any Letter of Credit issued by such Issuer such other Lender's
Percentage of all payments received by such Issuer from the Borrower in
reimbursement of drawings honored by such Issuer under such Letter of Credit
when such payments are received.
SECTION 2.7.5 DISBURSEMENTS. Each Issuer will notify the Borrower
and the Administrative Agent promptly of the presentment for payment of any
Letter of Credit, together
27
with notice of the date (the "DISBURSEMENT DATE") such payment shall be made.
Subject to the terms and provisions of such Letter of Credit, the applicable
Issuer shall make such payment to the beneficiary (or its designee) of such
Letter of Credit. Prior to 11:30 a.m., Central time, on the Disbursement
Date, the Borrower will reimburse the applicable Issuer for all amounts which
it has disbursed under the Letter of Credit. In the event the applicable
Issuer is not reimbursed by the Borrower on the Disbursement Date, or if such
Issuer must for any reason return or disgorge such reimbursement, the Lenders
(including such Issuer) shall, on the terms and subject to the conditions of
this Agreement, fund the Reimbursement Obligation therefor by making, on the
next Business Day, Loans which are Base Rate Loans as provided in SECTION
2.1.2 or 2.1.3 (the Borrower being deemed to have given a timely Borrowing
Request therefor for such amount); PROVIDED, HOWEVER, for the purpose of
determining the availability of the Commitments to make Loans immediately
prior to giving effect to the application of the proceeds of such Loans, such
Reimbursement Obligation shall be deemed not to be outstanding at such time.
To the extent the applicable Issuer is not reimbursed in full in accordance
with the preceding sentences, the Borrower's Reimbursement Obligation shall
accrue interest at a fluctuating rate determined by reference to the
Alternate Base Rate, plus a margin of 2% per annum, payable on demand.
SECTION 2.7.6 REIMBURSEMENT. The Borrower's obligation (a
"REIMBURSEMENT OBLIGATION") under SECTION 2.7.5 to reimburse an Issuer with
respect to each Disbursement (including interest thereon), and each Lender's
obligation to make participation payments in each drawing which has not been
reimbursed by the Borrower, shall be absolute and unconditional under any and
all circumstances and irrespective of any setoff, counterclaim, or defense to
payment which the Borrower may have or have had against any Lender or any
beneficiary of a Letter of Credit, including any defense based upon the
occurrence of any Default, any draft, demand or certificate or other document
presented under a Letter of Credit proving to be forged, fraudulent, invalid
or insufficient, the failure of any disbursement to conform to the terms of
the applicable Letter of Credit (if, in the applicable Issuer's good faith
opinion, such disbursement is determined to be appropriate) or any
non-application or misapplication by the beneficiary of the proceeds of such
disbursement, or the legality, validity, form, regularity, or enforceability
of such Letter of Credit; PROVIDED, HOWEVER, that nothing herein shall
adversely affect the right of the Borrower or any Lender to commence any
proceeding against the applicable Issuer for any wrongful disbursement made
by such Issuer under a Letter of Credit as a result of acts or omissions
constituting gross negligence or wilful misconduct on the part of such Issuer.
SECTION 2.7.7 DEEMED DISBURSEMENTS. Upon either (i) the occurrence
and during the continuation of an Event of Default pursuant to SECTION 8.1.9
or the occurrence of the Commitment Termination Date or (ii) the declaration
by the Administrative Agent of all or any portion of the outstanding
principal amount of the Loans and other Obligations to be due and payable
and/or the commitments (if not theretofore terminated) to be terminated as
provided in SECTION 8.3, an amount equal to that portion of Letter of Credit
Outstandings attributable to outstanding and undrawn Letters of Credit shall,
at the election of the applicable Issuer acting on
28
instructions from the Required Lenders, and without demand upon or notice to
the Borrower, be deemed to have been paid or disbursed by such Issuer under
such Letters of Credit (notwithstanding that such amount may not in fact have
been so paid or disbursed), and, upon notification by such Issuer to the
Administrative Agent and the Borrower of its obligations under this Section,
the Borrower shall be immediately obligated to reimburse such Issuer the
amount deemed to have been so paid or disbursed by such Issuer. Any amounts
so received by such Issuer from the Borrower pursuant to this Section shall
be held as collateral security for the repayment of the Borrower's
obligations in connection with the Letters of Credit issued by such Issuer.
All amounts on deposit pursuant to this SECTION 2.7.7 shall, until their
application to any Obligation or their return to the Borrower, as the case
may be, at the Borrower's written request, be invested in high grade
short-term liquid investments acceptable to Administrative Agent and
designated by the Borrower, which investments shall be held by the
Administrative Agent as additional collateral security for the repayment of
the Borrower's Obligations under and in connection with the Letters of Credit
and all other Obligations. Any losses, net of earnings, and reasonable fees
and expenses of such investments shall be charged against the principal
amount invested. The Administrative Agent and the Lenders shall not be
liable for any loss resulting from any investment made by the Administrative
Agent at the Borrower's request. The Administrative Agent is not obligated
hereby, or by any other Loan Document, to make or maintain any investment,
except upon written request by the Borrower. At any time when such Letters
of Credit shall terminate and all Obligations to each Issuer are either
terminated or paid or reimbursed to such Issuer in full, the Obligations of
the Borrower under this Section shall be reduced accordingly (subject,
however, to reinstatement in the event any payment in respect of such Letters
of Credit is recovered in any manner from such Issuer), and such Issuer will
return to the Borrower the excess, if any, of (a) the aggregate amount held
by such Issuer and not theretofore applied by such Issuer to any
Reimbursement Obligation OVER (b) the aggregate amount of all Reimbursement
Obligations to such Issuer pursuant to this Section, as so adjusted. At such
time when all Events of Default shall have been cured or waived, if the
Reducing Loan Commitment Termination Date shall not have occurred for any
reason, each Issuer shall return to the Borrower all amounts then on deposit
with such Issuer pursuant to this Section.
SECTION 2.7.8 NATURE OF REIMBURSEMENT OBLIGATIONS. The Borrower
shall assume all risks of the acts, omissions, or misuse of any Letter of
Credit by the beneficiary thereof. Neither any Issuer nor any Lender (except
to the extent of its own gross negligence or wilful misconduct) shall be
responsible for: (a) the form, validity, sufficiency, accuracy, genuineness,
or legal effect of any Letter of Credit or any document submitted by any
party in connection with the application for and issuance of a 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 form, validity,
sufficiency, accuracy, genuineness, or legal effect of any instrument
transferring or assigning or purporting to transfer or assign a 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 to comply fully with conditions required in order
to
29
demand payment under a Letter of Credit; (d) errors, omissions,
interruptions, or delays in transmission or delivery of any messages, by
mail, cable, telegraph, telex, facsimile or otherwise; or (e) any loss or
delay in the transmission or otherwise of any document or draft required in
order to make a Disbursement under a Letter of Credit or of the proceeds
thereof. None of the foregoing shall affect, impair, or prevent the vesting
of any of the rights or powers granted any Issuer or any Lender hereunder.
In furtherance and extension, and not in limitation or derogation, of any of
the foregoing, any action taken or omitted to be taken by any Issuer in good
faith shall be binding upon the Borrower and shall not put such Issuer under
any resulting liability to the Borrower.
SECTION 2.7.9 INCREASED COSTS; INDEMNITY. If by reason of (a) any
change in applicable law, regulation, rule, decree or regulatory requirement
or any change in the interpretation or application by any judicial or
regulatory authority of any law, regulation, rule, decree or regulatory
requirement, or (b) compliance by any Issuer or any Lender with any
direction, or requirement of any governmental or monetary authority,
including Regulation D of the F.R.S. Board: (i) any Issuer or any Lender
shall be subject to any tax (other than taxes on net income and franchises),
levy, charge or withholding of any nature or to any variation thereof or to
any penalty with respect to the maintenance or fulfillment of its obligations
under this SECTION 2.7, whether directly or by such being imposed on or
suffered by such Issuer or such Lender; (ii) any reserve, deposit or similar
requirement is or shall be applicable, increased, imposed or modified in
respect of any Letters of Credit issued by any Issuer or participations
therein purchased by any Lender; or (iii) there shall be imposed on any
Issuer or any Lender any other condition regarding this SECTION 2.7, any
Letter of Credit or any participation therein, and the result of the
foregoing is directly to increase the cost to such Issuer or such Lender of
issuing or maintaining any Letter of Credit or of purchasing or maintaining
any participation therein, or to reduce any amount receivable in respect
thereof by such Issuer or such Lender, then and in any such case such Issuer
or such Lender may, at any time after the additional cost is incurred or the
amount received is reduced, notify the Administrative Agent and the Borrower
thereof, and the Borrower shall pay within 10 days of demand such amounts as
such Issuer or Lender may in good faith specify to be necessary to compensate
such Issuer or Lender for such additional cost or reduced receipt, together
with interest on such amount from the date demanded until payment in full
thereof at a rate equal at all times to the Alternate Base Rate per annum.
The determination by such Issuer or Lender, as the case may be, of any amount
due pursuant to this Section, as set forth in a statement setting forth the
calculation thereof in reasonable detail, shall be rebuttable presumptive
evidence of such amounts.
In addition to amounts payable as elsewhere provided in this SECTION
2.7, the Borrower hereby indemnifies, exonerates and holds each Issuer, the
Administrative Agent and each Lender harmless from and against any and all
actions, causes of action, suits, losses, costs, liabilities and damages, and
expenses incurred in connection therewith (irrespective of whether such
Issuer, the Administrative Agent or such Lender is a party to the action for
which indemnification is
30
sought), including reasonable attorneys' fees and disbursements, which such
Issuer, the Administrative Agent or such Lender may incur or be subject to as
a consequence, direct or indirect, of the issuance of the Letters of Credit,
other than as a result of the gross negligence or willful misconduct of such
Issuer as determined by a court of competent jurisdiction, or the failure of
such Issuer to honor a drawing under any Letter of Credit as a result of any
act or omission, whether rightful or wrongful, of any present or future de
jure or de facto government or governmental authority.
ARTICLE 3
REPAYMENTS, PREPAYMENTS, INTEREST AND FEES
SECTION 3.1 REPAYMENTS AND PREPAYMENTS. The Borrower shall repay
in full the unpaid principal amount of each Loan upon the Stated Maturity
Date therefor; it being understood that, subject to satisfaction of the terms
and conditions hereof, repayment on the Stated Maturity Date of the Revolving
Loan shall be by converting the then outstanding balances of the Revolving
Loans to Reducing Loans as provided in SECTION 2.1.3. Each prepayment of any
Loans made pursuant to this Section shall be without premium or penalty,
except as may be required by SECTION 4.4. No voluntary prepayment of
principal of any Reducing Loans shall cause a reduction in the Reducing Loan
Commitment Amount or the Revolving Loan Commitment Amount.
SECTION 3.1.1 OPTIONAL PREPAYMENT. At any time prior to the Stated
Maturity Date, the Borrower may, from time to time on any Business Day, make
a voluntary prepayment, in whole or in part, of the outstanding principal
amount of any Loans; PROVIDED, HOWEVER, that (a) any such prepayment shall be
made PRO RATA among Loans of the same type and, if applicable, having the
same Interest Period of all Lenders, (b) no such prepayment of any LIBO Rate
Loan may be made on any day other than the last day of the Interest Period
for such Loan, (c) all such voluntary prepayments (i) of LIBO Rate Loans,
shall require at least one (1) Business Days' prior written notice to the
Administrative Agent, and (ii) of Base Rate Loans, shall require prior
written notice to the Administrative Agent, and (d) all such voluntary
partial prepayments shall be in an aggregate minimum amount of $500,000 and
an integral multiple of $500,000;
SECTION 3.1.2 MANDATORY PREPAYMENT ON REDUCING LOANS. The Borrower
shall, on each date when any reduction in the Reducing Loan Commitment Amount
shall become effective, including pursuant to SECTION 2.2, make a mandatory
prepayment of all Reducing Loans, equal to the excess, if any, of the
aggregate, outstanding principal amount of all Reducing Loans together with
Letter of Credit Outstandings over the Reducing Loan Commitment Amount as so
reduced.
SECTION 3.1.3 MANDATORY PREPAYMENT ON ACCELERATION. The Borrower
shall, immediately upon any acceleration of the Stated Maturity Date of any
Loans pursuant to
31
SECTION 8.2 or SECTION 8.3, repay all Loans, unless, pursuant to SECTION 8.3,
only a portion of all Loans is so accelerated.
SECTION 3.1.4 MANDATORY AS TO MANDATORY PREPAYMENT RATIO. In the
event that the Borrower's Mandatory Prepayment Ratio is at any time greater
than (i) for the period from the Effective Date through September 30, 1999,
5.00 to 1.0, (ii) for the period from October 1, 1999 through November 30,
1999, 5.75 to 1.0, (iii) for the period from December 1, 1999 through
December 31, 1999, 5.00 to 1.0, (iv) for the period from January 1, 2000
through June 30, 2000, 4.00 to 1.0, (v) for the period from July 1, 2000
through December 31, 2000, 3.50 to 1.0, and (vi) on or after January 1, 2001,
3.00 to 1.0, the Borrower shall be required to make a mandatory prepayment
with respect to outstanding Loans in an amount equal to the amount necessary
for the Borrower to return to compliance with the required Mandatory
Prepayment Ratio (the "MPR AMOUNT"). Borrower shall have the option to make
such mandatory prepayment of the MPR Amount either (a) immediately on the
date of the Borrower's failure to comply with the Mandatory Prepayment Ratio
or (b) in up to six (6) equal monthly installments with the first such
mandatory prepayment being due immediately on the date of such non-compliance
and, assuming that the Borrower remains out of compliance with the Mandatory
Prepayment Ratio, each subsequent payment shall be due and payable to the
Agent on the monthly anniversary of the Borrower's failure to comply with the
Mandatory Prepayment Ratio.
SECTION 3.2 INTEREST PROVISIONS. Interest on the outstanding
principal amount of Loans shall accrue and be payable in accordance with this
SECTION 3.2.
SECTION 3.2.1 RATES. Pursuant to an appropriately delivered
Borrowing Request or Continuation/Conversion Notice, the Borrower may elect
that Loans comprising a Borrowing accrue interest at a rate per annum: (a) on
that portion maintained from time to time as a Base Rate Loan, equal to the
Alternate Base Rate from time to time in effect; and (b) on that portion
maintained as a LIBO Rate Loan, during each Interest Period applicable
thereto, equal to the sum of the LIBO Rate (Reserve Adjusted) for such
Interest Period plus the Applicable Margin.
All LIBO Rate Loans shall bear interest from and including the first
day of the applicable Interest Period to (but not including) the last day of
such Interest Period at the interest rate determined as applicable to such
LIBO Rate Loan.
SECTION 3.2.2 POST-MATURITY RATES. After the date any principal
amount of any Loan is due and payable (whether on the Stated Maturity Date,
upon acceleration or otherwise), or after any other monetary Obligation of
the Borrower shall have become due and payable, the Borrower shall pay, but
only to the extent permitted by law, interest (after as well as before
judgment) on such amounts at a rate per annum equal to the Alternate Base
Rate plus a margin of 2%.
32
SECTION 3.2.3 PAYMENT DATES. Interest accrued on each Loan shall be
payable, without duplication: (a) on the Stated Maturity Date therefor; (b)
on the date of any payment or prepayment, in whole or in part, of principal
outstanding on such Loan; (c) with respect to Base Rate Loans, on each
Quarterly Payment Date occurring after the Effective Date; (d) with respect
to LIBO Rate Loans, the last day of each applicable Interest Period (and, if
such Interest Period shall exceed 90 days, on the 90th day of such Interest
Period); (e) with respect to any Base Rate Loans converted into LIBO Rate
Loans on a day when interest would not otherwise have been payable pursuant
to CLAUSE (c), on the date of such conversion; and (f) on that portion of any
Loans the Stated Maturity Date of which is accelerated pursuant to SECTION
8.2 or SECTION 8.3, immediately upon such acceleration. Interest accrued on
Loans or other monetary Obligations arising under this Agreement or any other
Loan Document after the date such amount is due and payable (whether on the
Stated Maturity Date, upon acceleration or otherwise) shall be payable upon
demand.
SECTION 3.3 FEES. The Borrower agrees to pay the fees set forth
in this SECTION 3.3. All such fees shall be non-refundable.
SECTION 3.3.1 COMMITMENT FEE. The Borrower agrees to pay to the
Administrative Agent for the account of each Lender, for the period
(including any portion thereof when any of its Commitments are suspended by
reason of the Borrower's inability to satisfy any condition of 5) commencing
on the Effective Date and continuing through the final Commitment Termination
Date, a Commitment Fee on such Lender's Percentage of the sum of the average
daily unused portion of the Commitment Amount (outstanding Loans and Letters
of Credit being deemed to be usage hereunder). Such Commitment Fee shall be
payable by the Borrower in arrears, on each Quarterly Payment Date,
commencing with the first such day following the Effective Date, and on each
Commitment Termination Date.
SECTION 3.3.2 ADMINISTRATIVE AGENT'S FEE. To the Administrative
Agent for its own account, the fees provided in the letter dated July 7, 1999
between the Borrower and the Administrative Agent.
SECTION 3.3.3 LETTER OF CREDIT FEES. (a) The Borrower agrees to pay
to the Administrative Agent, for the account of each Lender, a fee for each
Letter of Credit for the period from and including the date of the issuance
of such Letter of Credit to (but not including) the date upon which such
Letter of Credit expires, at a per annum rate equal to the Applicable Margin
on the outstanding face amount of each Letter of Credit. Such fee shall be
payable by the Borrower in arrears on each Quarterly Payment Date, and on the
Commitment Termination Date for any period then ending for which such fee
shall not theretofore have been paid, commencing on the first such date after
the issuance of such Letter of Credit.
33
(b) The Borrower agrees to pay to the Administrative Agent, for the
account of the Issuer, a Letter of Credit fronting fee for each Letter of
Credit upon the issuance of each Letter of Credit in an amount equal to the
greater of (i) $500 or (ii) one-eight of one percent (1/8 of 1%) per annum
calculated on the face amount thereof.
ARTICLE 4
CERTAIN LIBO RATE AND OTHER PROVISIONS
SECTION 4.1 FIXED RATE LENDING UNLAWFUL. If any Lender shall
determine (which determination shall, upon notice thereof to the Borrower and
the Lenders, be conclusive and binding on the Borrower) that the introduction
of or any change in or in the interpretation of any law makes it unlawful, or
any central bank or other governmental authority asserts that it is unlawful,
for such Lender to make, continue or maintain any Loan as, or to convert any
Loan into, a LIBO Rate Loan of a certain type, the obligations of all Lenders
to make, continue, maintain or convert any such Loans shall, upon such
determination, forthwith be suspended until such Lender shall notify the
Administrative Agent that the circumstances causing such suspension no longer
exist, and all LIBO Rate Loans of such type shall automatically convert into
Base Rate Loans at the end of the then current Interest Periods with respect
thereto or sooner, if required by such law or assertion.
SECTION 4.2 DEPOSITS UNAVAILABLE. If the Administrative Agent
shall have determined that (a) Dollar deposits in the relevant amount and for
the relevant Interest Period are not available to the Lenders in their
relevant markets; or (b) by reason of circumstances affecting BofA's relevant
market, adequate means do not exist for ascertaining the interest rate
applicable hereunder to LIBO Rate Loans, then, upon notice from the
Administrative Agent to the Borrower and the Lenders, the obligations of all
Lenders under SECTION 2.3 and SECTION 2.4 to make or continue any Loans as,
or to convert any Loans into, LIBO Rate Loans shall forthwith be suspended
until the Administrative Agent shall notify the Borrower and the Lenders that
the circumstances causing such suspension no longer exist.
SECTION 4.3 INCREASED LIBO RATE LOAN COSTS, ETC. The Borrower
agrees to reimburse each Lender for any increase in the cost to such Lender
of, or any reduction in the amount of any sum receivable by such Lender in
respect of, making, continuing or maintaining (or of its obligation to make,
continue or maintain) any Loans as, or of converting (or of its obligation to
convert) any Loans into, LIBO Rate Loans. Such Lender shall promptly notify
the Administrative Agent and the Borrower in writing of the occurrence of any
such event, such notice to state, in reasonable detail, the reasons therefor
and the additional amount required fully to compensate such Lender for such
increased cost or reduced amount; provided, that no Lender shall give such
notice unless it is generally charging borrowers similarly situated to the
Borrower with similar agreements with such Lender such amounts. Such
additional amounts shall be
34
payable by the Borrower directly to such Lender within five days of its
receipt of such notice, and such notice shall be rebuttable presumptive
evidence of such amounts.
SECTION 4.4 FUNDING LOSSES. In the event any Lender shall incur
any loss or expense (including any loss or expense incurred by reason of the
liquidation or reemployment of deposits or other funds acquired by such
Lender to make, continue or maintain any portion of the principal amount of
any Loan as, or to convert any portion of the principal amount of any Loan
into, a LIBO Rate Loan) as a result of (a) any conversion or repayment or
prepayment of the principal amount of any LIBO Rate Loans on a date other
than the scheduled last day of the Interest Period applicable thereto,
whether pursuant to SECTION 3.1 or otherwise; (b) any Loans not being made as
LIBO Rate Loans in accordance with the Borrowing Request therefor; or (c) any
Loans not being continued as, or converted into, LIBO Rate Loans in
accordance with the Continuation/ Conversion Notice therefor, then, upon the
written notice of such Lender to the Borrower (with a copy to the
Administrative Agent), the Borrower shall, within five days of its receipt
thereof, pay directly to such Lender such amount as will (in the reasonable
determination of such Lender) reimburse such Lender for such loss or expense.
Such written notice (which shall include calculations in reasonable detail)
and shall be rebuttable presumptive evidence of such amounts.
SECTION 4.5 INCREASED CAPITAL COSTS. If any change in, or the
introduction, adoption, effectiveness, interpretation, reinterpretation or
phase-in of, any law or regulation, directive, guideline, decision or request
of any court, central bank, regulator or other governmental authority affects
or would affect the amount of capital required or expected to be maintained
by any Lender or any Person controlling such Lender, and such Lender
determines (in its discretion exercised in good faith) that the rate of
return on its or such controlling Person's capital as a consequence of its
Commitments or the Loans made by such Lender is reduced to a level below that
which such Lender or such controlling Person could have achieved but for the
occurrence of any such circumstance, then, in any such case upon notice from
time to time by such Lender to the Borrower, the Borrower shall immediately
pay directly to such Lender additional amounts sufficient to compensate such
Lender or such controlling Person for such reduction in rate of return. A
statement of such Lender as to any such additional amount or amounts shall be
furnished to Borrower including calculations thereof in reasonable detail and
shall be rebuttable presumptive evidence of such amounts. In determining
such amount, such Lender may use any method of averaging and attribution that
it (in its discretion exercised in good faith) shall deem applicable.
SECTION 4.6 TAXES. All payments by the Borrower of principal of,
and interest on, the Loans, all payments in respect of the Reimbursement
Obligations and all other amounts payable hereunder shall be made free and
clear of and without deduction for any future enacted or increased income,
excise, stamp or franchise taxes and other taxes, fees, duties, withholdings
or other charges of any nature whatsoever imposed by any taxing authority,
but excluding
35
franchise taxes and taxes imposed on or measured by any Lender's net income
or receipts (such non-excluded items being called "TAXES"). In the event
that any withholding or deduction from any payment to be made by the Borrower
hereunder is required in respect of any Taxes pursuant to any applicable law,
rule or regulation, then the Borrower will (a) pay directly to the relevant
authority the full amount required to be so withheld or deducted; (b)
promptly forward to the Administrative Agent an official receipt or other
documentation satisfactory to the Administrative Agent evidencing such
payment to such authority; and (c) pay to the Administrative Agent for the
account of the Lenders such additional amount or amounts as is necessary to
ensure that the net amount actually received by each Lender will equal the
full amount such Lender would have received had no such withholding or
deduction been required. Moreover, if any Taxes are directly asserted
against the Administrative Agent or any Lender with respect to any payment
received by the Administrative Agent or such Lender hereunder, the
Administrative Agent or such Lender may pay such Taxes and the Borrower will
promptly pay such additional amounts (including, if incurred as a result of
the Borrower's action, omission or delay, any penalties, interest or
expenses) as is necessary in order that the net amount received by such
person after the payment of such Taxes (including any Taxes on such
additional amount) shall equal the amount such person would have received had
not such Taxes been asserted.
If the Borrower fails to pay any Taxes when due to the appropriate
taxing authority or fails to remit to the Administrative Agent, for the
account of the respective Lenders, the required receipts or other required
documentary evidence, the Borrower shall indemnify the Lenders for any
incremental Taxes, interest or penalties that may become payable by any
Lender as a result of any failure of Borrower to pay the taxing authorities
directly where required. For purposes of this SECTION 4.6, a distribution
hereunder by the Administrative Agent or any Lender to or for the account of
any Lender shall be deemed a payment by the Borrower.
Each Lender that is organized under the laws of a jurisdiction other
than the United States shall, prior to the due date of any payments under the
Notes, execute and deliver to the Borrower and the Administrative Agent, on
or about the first scheduled payment date in each Fiscal Year, one or more
(as the Borrower or the Administrative Agent may reasonably request) United
States Internal Revenue Service Forms 4224 or Forms 1001 or such other forms
or documents (or successor forms or documents), appropriately completed, as
may be applicable to establish the extent, if any, to which a payment to such
Lender is exempt from withholding or deduction of Taxes.
SECTION 4.7 PAYMENTS, COMPUTATIONS, ETC. Unless otherwise
expressly provided, all payments by the Borrower pursuant to this Agreement,
the Notes or any other Loan Document shall be made by the Borrower to the
Administrative Agent for the PRO RATA account of the Lenders entitled to
receive such payment. All such payments required to be made to the
Administrative Agent shall be made, without setoff, deduction or
counterclaim, not later than 11:00 a.m., Central time, on the date due, in
same day or immediately available funds, to such
36
account as the Administrative Agent shall specify from time to time by notice
to the Borrower. Funds received after that time shall be deemed to have been
received by the Administrative Agent on the next succeeding Business Day.
The Administrative Agent shall promptly remit in same day funds to each
Lender its share, if any, of such payments received by the Administrative
Agent for the account of such Lender. All interest and fees shall be
computed on the basis of the actual number of days (including the first day
but excluding the last day) occurring during the period for which such
interest or fee is payable over a year comprised of 360 days (or, in the case
of interest on a Base Rate Loan, 365 days or, if appropriate, 366 days).
Whenever any payment to be made shall otherwise be due on a day which is not
a Business Day, such payment shall (except as otherwise required by CLAUSE
(c) of the definition of the term "INTEREST PERIOD" with respect to LIBO Rate
Loans) be made on the next succeeding Business Day and such extension of time
shall be included in computing interest and fees, if any, in connection with
such payment.
SECTION 4.8 SHARING OF PAYMENTS. If any Lender shall obtain any
payment or other recovery (whether voluntary, involuntary, by application of
setoff or otherwise) on account of any Loan or any Reimbursement Obligation
(other than pursuant to the terms of SECTIONS 4.3, 4.4 and 4.5) in excess of
its PRO RATA share of payments then or therewith obtained by all Lenders,
such Lender shall purchase from the other Lenders such participations in
Loans made by them as shall be necessary to cause such purchasing Lender to
share the excess payment or other recovery ratably with each of them;
PROVIDED, HOWEVER, that if all or any portion of the excess payment or other
recovery is thereafter recovered from such purchasing Lender, the purchase
shall be rescinded and each Lender which has sold a participation to the
purchasing Lender shall repay to the purchasing Lender the purchase price to
the ratable extent of such recovery together with an amount equal to such
selling Lender's ratable share (according to the proportion of (a) the amount
of such selling Lender's required repayment to the purchasing Lender TO (b)
the total amount so recovered from the purchasing Lender) of any interest or
other amount paid or payable by the purchasing Lender in respect of the total
amount so recovered. The Borrower agrees that any Lender so purchasing a
participation from another Lender pursuant to this Section may, to the
fullest extent permitted by law, exercise all its rights of payment
(including pursuant to SECTION 4.9) with respect to such participation as
fully as if such Lender were the direct creditor of the Borrower in the
amount of such participation. If under any applicable bankruptcy, insolvency
or other similar law, any Lender receives a secured claim in lieu of a setoff
to which this Section applies, such Lender shall, to the extent practicable,
exercise its rights in respect of such secured claim in a manner consistent
with the rights of the Lenders entitled under this Section to share in the
benefits of any recovery on such secured claim.
SECTION 4.9 SETOFF. Each Lender shall, upon the occurrence of any
Default described in CLAUSES (a) through (d) of SECTION 8.1.9 or, with the
consent of the Required Lenders, upon the occurrence of any other Event of
Default, have the right to appropriate and apply to the payment of the
Obligations owing to it (whether or not then due), and (as security for such
Obligations) the Borrower hereby grants to each Lender a continuing security
interest in, any and
37
all balances, credits, deposits, accounts or moneys of the Borrower then or
thereafter maintained with such Lender; PROVIDED, HOWEVER, that any such
appropriation and application shall be subject to the provisions of SECTION
4.8. Each Lender agrees promptly to notify the Borrower and the
Administrative Agent after any such setoff and application made by such
Lender; PROVIDED, HOWEVER, that the failure to give such notice shall not
affect the validity of such setoff and application. The rights of each
Lender under this Section are in addition to other rights and remedies
(including other rights of setoff under applicable law or otherwise) which
such Lender may have.
SECTION 4.10 USE OF PROCEEDS. The Borrower shall apply the
proceeds of each Borrowing in accordance with the SEVENTH RECITAL; without
limiting the foregoing, no proceeds of any Loan will be used to acquire any
equity security of a class which is registered pursuant to Section 12 of the
Securities Exchange Act of 1934 or any "margin stock," as defined in F.R.S.
Board Regulation U except in connection with transactions (i) authorized by
the board of directors of the Borrower, (ii) either (A) authorized by the
board of directors or other governing body of the Person which stock is being
acquired or (B) involving less than 5% of the stock of any Person (except the
Borrower) and (iii) which would not cause the Borrower to fail to be in
compliance SECTION 6.17.
ARTICLE 5
CONDITIONS TO BORROWING
SECTION 5.1 CONTINUATION OF BMO LOANS; INITIAL BORROWING. The
obligations of the Lenders to continue the BMO Loans as Loans hereunder and
to fund the initial Borrowing and to issue the initial Letter of Credit shall
be subject to the prior or concurrent satisfaction of each of the conditions
precedent set forth in this SECTION 5.1.
SECTION 5.1.1 RESOLUTIONS, ETC. The Administrative Agent shall have
received from each Obligor a certificate, dated the date of the initial
Borrowing or the issuance of the initial Letter of Credit or of such
continuation, of its Secretary or Assistant Secretary as to (a) resolutions
of its Board of Directors then in full force and effect authorizing the
execution, delivery and performance of this Agreement, the Notes and each
other Loan Document to be executed by it, (b) the article or certificate of
incorporation for such Obligor, (c) the bylaws of such Obligor, (d) the
incumbency and signatures of those of its officers authorized to act with
respect to this Agreement, the Notes and each other Loan Document executed by
it, upon which certificate each Lender may conclusively rely until it shall
have received a further certificate of the Secretary of such Obligor
canceling or amending such prior certificate, and (e) that the Borrower and
its Subsidiaries are in compliance with all of the covenants and agreements
contained in this Agreement or any other Loan Document. The Administrative
Agent shall have received from each Obligor certificates of existence and
good standing provided by the
38
appropriate governmental officer in its jurisdiction of incorporation and, in
the case of certificates of good standing, in each jurisdiction in which its
business is conducted.
SECTION 5.1.2 DELIVERY OF NOTES. The Administrative Agent shall
have received, for the account of each Lender, its Notes duly executed and
delivered by the Borrower.
SECTION 5.1.3 PAYMENT OF OBLIGATIONS UNDER ASSIGNMENT AGREEMENT AND
OUTSTANDING INDEBTEDNESS, ETC. BMO, for its own benefit as agent for the BMO
Lenders and for the benefit of the BMO Lenders, shall have received payment
for all amounts set forth in the Assignment Agreement (including, to the
extent necessary, from the proceeds of the initial Borrowing), and all Liens
securing any payments required to be made to the BMO, as agent for the BMO
Lenders, or the BMO Lenders shall have been assigned to the Administrative
Agent on behalf of the Administrative Agent and the Lenders and the
Administrative Agent shall have received all Uniform Commercial Code Form
UCC-3 financing statements or other instruments as may be suitable or
appropriate in connection with such assignment. All Indebtedness identified
in ITEM 7.2.2(b) ("Indebtedness to be Paid") of the Disclosure Schedule,
together with all interest, all prepayment premiums and other amounts due and
payable with respect thereto, shall have been paid in full (including, to the
extent necessary, from proceeds of the initial Borrowing); and all Liens
securing payment of any such Indebtedness have been released and the
Administrative Agent shall have received all Uniform Commercial Code Form
UCC-3 termination statements or other instruments as may be suitable or
appropriate in connection therewith.
SECTION 5.1.4 GUARANTY. The Administrative Agent shall have
received a Guaranty, dated the date hereof, duly executed by MarkWest
Michigan, MarkWest Resources, West Shore, Basin and Matrex.
SECTION 5.1.5 PLEDGE AGREEMENT AMENDMENT AND HYDROCARBON PLEDGE
AGREEMENT AMENDMENT. The Administrative Agent shall have received executed
counterparts of the Pledge Agreement Amendment and the Hydrocarbon Pledge
Agreement Amendment, dated as of the date hereof, duly executed by the
Borrower, together with (a) executed copies of proper Uniform Commercial Code
Form UCC-3 statements, if any, necessary to assign to the Administrative
Agent and the Lenders all Liens and other rights of any Person as a valid,
perfected first priority Lien in any collateral described in the Pledge
Agreement and the Hydrocarbon Pledge Agreement, (b) certificates, evidencing
all of the issued and outstanding shares of capital stock pledged pursuant to
the Pledge Agreement and the Hydrocarbon Pledge Agreement which certificates
shall in each case be accompanied by undated stock powers duly executed in
blank, or, if any securities pledged pursuant to the Pledge Agreement or the
Hydrocarbon Pledge Agreement are uncertificated securities, confirmation and
evidence satisfactory to the Administrative Agent that the security interest
in such uncertificated securities has been transferred to and perfected by
the Administrative Agent for the benefit of the Lenders
39
in accordance with Section 8-313 and Section 8-321 of the Uniform Commercial
Code, as in effect in the State of New York, and (c) certified copies of
Uniform Commercial Code Requests for Information or Copies (Form UCC-11), or
a similar search report certified by a party acceptable to the Administrative
Agent, dated a date reasonably near to the date of the initial Borrowing,
listing all effective financing statements which name the Borrower (under its
present name and any previous name) as the debtor and which are filed in the
jurisdictions in which filings were made pursuant to CLAUSE (a) above,
together with copies of such financing statements, none of which shall cover
any collateral described in the Pledge Agreement or the Hydrocarbon Pledge
Agreement.
SECTION 5.1.6 SECURITY AGREEMENT AMENDMENTS. The Administrative
Agent shall have received executed counterparts of (a) the Security Agreement
Amendment, the West Shore Security Agreement Amendment and the Basin Security
Agreement Amendment executed by the Borrower, West Shore and Basin,
respectively, together with (b) executed copies of proper Uniform Commercial
Code Form UCC-3 statements, if any, necessary to assign to the Administrative
Agent and the Lenders all Liens and other rights of any Person as a valid,
perfected first priority Lien (i) in any collateral described in the Security
Agreement, the West Shore Security Agreement and the Basin Security
Agreement, respectively, previously granted by any Person, and (ii) securing
any of the Indebtedness under this Agreement, and (c) certified copies of
Uniform Commercial Code Requests for Information or Copies (Form UCC-11), or
a similar search report certified by a party acceptable to the Administrative
Agent, dated a date reasonably near to the date of the initial Borrowing,
listing all effective financing statements which name the Borrower, MarkWest
Resources, MarkWest Michigan, West Shore or Basin (under their present names
and any previous names) as the debtor and which are filed in the
jurisdictions in which filings were made pursuant to CLAUSE (A) above,
together with copies of such financing statements, none of which shall cover
any collateral described in the Security Agreement, the West Shore Security
Agreement or the Basin Security Agreement.
SECTION 5.1.7 MORTGAGE AMENDMENTS. The Administrative Agent shall
have received counterparts of the Mortgage Amendments, duly executed and
delivered by the Borrower, together with evidence of the completion (or
satisfactory arrangements for completion) of all recordings and filings of
such Mortgage Amendments, together with executed copies of proper uniform
commercial code form UCC-3 statements, if any, necessary to assign to the
Administrative Agent and the Lenders all Liens and other rights of any Person
as a valid, perfected first priority Lien in any of the collateral described
in any of the Mortgages previously granted by any Person, and securing any of
the Indebtedness under the A&R Credit Agreement and as may be necessary or,
in the reasonable opinion of the Administrative Agent, desirable effectively
to assign to the Administrative Agent and the Lenders and to create or
maintain a valid, perfected first priority Lien against the properties
purported to be covered by such Mortgage Amendments, together with certified
copies of Uniform Commercial Code requests for information or copies (form
UCC-11) or a similar search report certified by a party acceptable to
40
the Administrative Agent, dated a date reasonably near to the date of the
effectiveness hereof, listing all effective financing statements which name
the Borrower, MarkWest Resources, MarkWest Michigan, West Shore and Basin.
(under their present names and any previous names) as the Debtor and which
are filed in jurisdictions in which filings were made pursuant to the
foregoing, together with copies of such financing statements, none of which
shall cover any collateral described in the Mortgages as amended by the
Mortgage Amendments.
SECTION 5.1.8 OPINIONS OF COUNSEL AND TITLE POLICIES. The
Administrative Agent shall have received a legal opinion from Xxxxx Xxxxxxx,
counsel to the Borrower and its Subsidiaries, substantially in the form of
EXHIBIT E hereto, dated the date of the effectiveness hereof or such other
date as is acceptable to the Administrative Agent and the Lenders and
addressed to the Administrative Agent and all Lenders.
SECTION 5.1.9 CLOSING FEES, EXPENSES, ETC. The Administrative Agent
shall have received for its own account, or for the account of each Lender,
as the case may be, all fees, costs and expenses due and payable pursuant to
SECTION 3.3 (including the letter referred to in Section 3.3.2), if then
invoiced.
SECTION 5.1.10 EVIDENCE OF INSURANCE. The Administrative Agent shall
have received certificates of insurance satisfactory to it evidencing the
existence of all insurance required to be maintained by the Borrower by this
Agreement and the other Loan Documents, which insurance shall list
Administrative Agent as additional insured and sole loss payee and be
satisfactory to the Administrative Agent.
SECTION 5.1.11 ASSIGNMENT OF KEY MAN LIFE INSURANCE AND BUSINESS
INTERRUPTION INSURANCE. The Administrative Agent shall have received an
assignment of any "key man" life insurance maintained on any officers or
directors of the Borrower or any of its Subsidiaries and any business
interruption insurance maintained by the Borrower and its Subsidiaries,
together with acknowledgments from the companies issuing such policies, all
in form and substance satisfactory to the Administrative Agent.
SECTION 5.1.12 PROJECTIONS. The Administrative Agent and the Lenders
shall have received an annual budget for 1999 of the Borrower and its
Subsidiaries, together with 5-year projections in form and substance
satisfactory to the Lenders, setting forth in reasonable detail the
Borrower's and its Subsidiaries' consolidated income statement and funds flow
for a five-year period commencing January 1, 1999, certified by the Chief
Financial Officer of the Borrower as being the Borrower's best estimate and
based upon information that is then currently available and believed to be
correct and upon assumptions believed to be reasonable, and no event shall
have occurred, and no condition shall exist, that in the Lenders' judgment
shall be materially inconsistent with the information or the projections
provided to the Lenders.
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SECTION 5.1.13 HEDGING POLICY. The Administrative Agent and the
Lenders shall have received a copy of the hedging policy of the Borrower and
its Subsidiaries (the "HEDGING POLICY") approved by the Borrower's Board of
Directors and certified by the Chief Financial Officer of the Borrower as
being true, correct and complete and in force and effect; which hedging
policy shall be substantially in the form of EXHIBIT X hereto and in form,
substance and effect satisfactory to the Administrative Agent and the
Required Lenders and including policies regarding gas imbalances, take-or-pay
obligations, Hedging Obligations, prepayment agreements and inventory
balances.
SECTION 5.1.14 ASSIGNMENT AGREEMENT. The Administrative Agent shall
have received executed counterparts of the Assignment Agreement (the
"ASSIGNMENT AGREEMENT"), substantially in the form of EXHIBIT P hereto.
SECTION 5.1.15 MARKWEST MICHIGAN PLEDGE AGREEMENT AMENDMENT AND WEST
SHORE PLEDGE AGREEMENT AMENDMENT. The Administrative Agent shall have
received executed counterparts of the MarkWest Michigan Pledge Agreement
Amendment and the West Shore Pledge Agreement Amendment, dated as of the date
hereof, duly executed by the Borrower, together with (a) executed copies of
proper Uniform Commercial Code Form UCC-3 statements, if any, necessary to
assign to the Administrative Agent and the Lenders all Liens and other rights
of any Person as a valid, perfected first priority Lien in any collateral
described in the MarkWest Michigan Pledge Agreement and the and the West
Shore Pledge Agreement, (b) certificates, evidencing all of the issued and
outstanding shares of capital stock pledged pursuant to the MarkWest Michigan
Pledge Agreement and the West Shore Pledge Agreement which certificates shall
in each case be accompanied by undated stock powers duly executed in blank,
or, if any securities pledged pursuant to the MarkWest Michigan Pledge
Agreement or the West Shore Pledge Agreement are uncertificated securities,
confirmation and evidence satisfactory to the Administrative Agent that the
security interest in such uncertificated securities has been transferred to
and perfected by the Administrative Agent for the benefit of the Lenders in
accordance with Section 8-313 and Section 8-321 of the Uniform Commercial
Code, as in effect in the State of New York, and (c) certified copies of
Uniform Commercial Code Requests for Information or Copies (Form UCC-11), or
a similar search report certified by a party acceptable to the Administrative
Agent, dated a date reasonably near to the date of the initial Borrowing,
listing all effective financing statements which name MarkWest Michigan under
its present name and any previous name) as the debtor and which are filed in
the jurisdictions in which filings were made pursuant to CLAUSE (a) above,
together with copies of such financing statements, none of which shall cover
any collateral described in the MarkWest Michigan Pledge Agreement or the
West Shore Pledge Agreement, respectively).
SECTION 5.2 CONDITIONS PRECEDENT TO INITIAL REDUCING LOAN. The
obligation of the Lenders to make the initial Reducing Loan shall, in
addition to the conditions precedent
42
specified in SECTION 5.3, be subject to the prior or concurrent satisfaction
of each of the conditions precedent set forth in this SECTION 5.2.
SECTION 5.2.1 REVOLVING LOANS PAID. The principal of and accrued
interest on the Revolving Loans shall have been paid or be paid in full or
converted into Reducing Loans hereunder, and included under the Reducing Loan
Commitment, in each case, prior to or concurrently with the making of the
initial Reducing Loan. The Borrower hereby agrees and instructs the
Administrative Agent to apply the proceeds of the Reducing Loan to the extent
required to the payment in full of the principal of and accrued interest on
all Revolving Loans then outstanding and the Administrative Agent agrees to
remit such proceeds, if any, for such purpose.
SECTION 5.2.2 CONFIRMATORY CERTIFICATE. The Administrative Agent
shall have received a certificate, in form and substance satisfactory to the
Administrative Agent, dated the Conversion Date and signed by an officer of
the Borrower acceptable to the Administrative Agent, as to the matters set
forth in SECTION 5.3.1 and such other documents as the Lender may have
reasonably requested in support thereof, including, duly executed and updated
copies or other confirmations of the continuing effectiveness of any or all
of the Loan Documents.
SECTION 5.2.3 CONVERSION DATE OPINION. The Administrative Agent
shall have received a favorable opinion of counsel to the Borrower and the
other Obligors dated as of the Conversion Date satisfactory to the
Administrative Agent in form and substance, addressed to the Administrative
Agent and the Lenders, opining as to this Agreement and the other Loan
Documents after giving effect to any Reducing Loan, and with respect to,
among other things, the priority and the perfection of the Liens created by
each of the Collateral Documents, after giving effect to any Reducing Loan.
SECTION 5.3 ALL BORROWINGS. The obligation of each Lender to fund
any Loan on the occasion of any Borrowing (including the initial Borrowing)
and to issue any Letter of Credit (including the initial Letter of Credit)
shall be subject to the satisfaction of each of the conditions precedent set
forth in this SECTION 5.3.
SECTION 5.3.1 COMPLIANCE WITH WARRANTIES, NO DEFAULT, ETC. Both
before and after giving effect to any Borrowing or Letter of Credit (but, if
any Default of the nature referred to in SECTION 8.1.5 shall have occurred
with respect to any other Indebtedness, without giving effect to the
application, directly or indirectly, of the proceeds thereof) the following
statements shall be true and correct in all material respects (a) the
representations and warranties set forth in ARTICLE 6 (excluding, however,
those contained in SECTION 6.7), and in each Collateral Document shall be
true and correct with the same effect as if then made (unless stated to
relate solely to an early date, in which case such representations and
warranties shall be true and correct as of such earlier date); (b) except as
disclosed by the Borrower to the Administrative Agent and the
43
Lenders pursuant to SECTION 6.7 (i) no labor controversy, litigation,
arbitration or governmental investigation or proceeding shall be pending or,
to the knowledge of the Borrower, threatened against the Borrower or any of
its Subsidiaries which might materially adversely affect the Borrower's and
its Subsidiaries' consolidated business, operations, assets, revenues,
properties or prospects or which purports to affect the legality, validity or
enforceability of this Agreement, the Notes or any other Loan Document; and
(ii) no development shall have occurred in any labor controversy, litigation,
arbitration or governmental investigation or proceeding disclosed pursuant to
SECTION 6.7 which might materially adversely affect the consolidated
businesses, operations, assets, revenues, properties or prospects of the
Borrower and its Subsidiaries; and (c) no Default shall have then occurred
and be continuing, and neither the Borrower, any other Obligor, nor any of
their Subsidiaries are in material violation of any law or governmental
regulation or court order or decree.
SECTION 5.3.2 BORROWING REQUEST. The Administrative Agent shall
have received a Borrowing Request for such Borrowing or Issuance Request for
such Letter of Credit, as the case may be. Each of the delivery of a
Borrowing Request or Issuance Request for such Letter of Credit, as the case
may be, and the acceptance by the Borrower of the proceeds of such Borrowing
or such Letter of Credit shall constitute a representation and warranty by
the Borrower that on the date of such Borrowing (both immediately before and
after giving effect to such Borrowing and the application of the proceeds
thereof) the statements made in SECTION 5.3.1 are true and correct.
SECTION 5.3.3 SATISFACTORY LEGAL FORM. All documents executed or
submitted pursuant hereto by or on behalf of the Borrower or any of its
Subsidiaries or any other Obligors shall be satisfactory in form and
substance to the Administrative Agent and its counsel; (which satisfaction is
acknowledged with respect to any documents conforming to the respective
Exhibit attached hereto) the Administrative Agent and its counsel shall have
received all information, approvals, opinions, documents or instruments as
the Administrative Agent or its counsel may reasonably request.
ARTICLE 6
REPRESENTATIONS AND WARRANTIES
In order to induce the Lenders and the Administrative Agent to enter
into this Agreement and to make Loans hereunder, the Borrower represents and
warrants unto the Administrative Agent and each Lender as set forth in this
ARTICLE 6 except as otherwise indicated on the Disclosure Schedule.
SECTION 6.1 ORGANIZATION, ETC. The Borrower and each of its
Subsidiaries is a corporation validly organized and existing and in good
standing under the laws of the State of its incorporation, is duly qualified to
do business and is in good standing as a foreign corporation
44
in each jurisdiction where the nature of its business requires such
qualification, and has full power and authority and holds all requisite
governmental licenses, permits and other approvals to enter into and perform
its Obligations under this Agreement, the Notes and each other Loan Document
to which it is a party and to own and hold under lease its property and to
conduct its business substantially in accordance with the first recital.
SECTION 6.2 DUE AUTHORIZATION, NON-CONTRAVENTION, ETC. The
execution, delivery and performance by the Borrower of this Agreement, the
Notes and each other Loan Document executed or to be executed by it, and the
execution, delivery and performance by each other Obligor of each Loan
Document executed or to be executed by it are within the Borrower's and each
such Obligor's corporate powers, have been duly authorized by all necessary
corporate action, and do not (a) contravene the Borrower's or any such
Obligor's Organic Documents; (b) contravene any contractual restriction, law
or governmental regulation or court decree or order binding on or affecting
the Borrower or any such Obligor; or (c) result in, or require the creation
or imposition of, any Lien on any of any Obligor's properties.
SECTION 6.3 GOVERNMENT APPROVAL, REGULATION, ETC. No
authorization or approval or other action by, and no notice to or filing
with, any governmental authority or regulatory body or other Person is
required for the due execution, delivery or performance by the Borrower of
this Agreement, the Notes or any other Loan Document to which it is a party.
The Borrower and its Subsidiaries possess all authorizations, approvals,
permits and licenses necessary to operate their respective businesses as
current operated and as anticipated to be operated. Neither the Borrower nor
any of its Subsidiaries is an "investment company" within the meaning of the
Investment Company Act of 1940, as amended, or a "holding company," or a
"subsidiary company" of a "holding company," or an "affiliate" of a "holding
company" or of a "subsidiary company" of a "holding company," within the
meaning of the Public Utility Holding Company Act of 1935, as amended.
SECTION 6.4 VALIDITY, ETC. This Agreement constitutes, and the
Notes and each other Loan Document executed by the Borrower will, on the due
execution and delivery thereof, constitute, the legal, valid and binding
obligations of the Borrower enforceable in accordance with their respective
terms; and each Loan Document executed pursuant hereto by each other Obligor
will, on the due execution and delivery thereof by such Obligor, be the
legal, valid and binding obligation of such Obligor enforceable in accordance
with its terms.
SECTION 6.5 FINANCIAL INFORMATION. The balance sheets of the
Borrower and each of its Subsidiaries as at June 30, 1999, and the related
statements of earnings and cash flow of the Borrower and each of its
Subsidiaries, copies of which have been furnished to the Administrative Agent
and each Lender, have been prepared in accordance with GAAP consistently
applied, and present fairly the consolidated financial condition of the
corporations covered thereby as at the dates thereof and the results of their
operations for the periods then
45
ended. The Borrower and each of its Subsidiaries are in compliance with all
of their existing financial obligations.
SECTION 6.6 NO MATERIAL ADVERSE CHANGE. Since the date of the
financial statements described in SECTION 6.5, there has not been any
material adverse change in the financial condition, operations, assets,
business, properties or prospects of the Borrower and its Subsidiaries.
SECTION 6.7 LITIGATION, LABOR CONTROVERSIES, ETC. There is no
pending or, to the knowledge of the Borrower, threatened litigation, action,
proceeding, or labor controversy affecting the Borrower or any of its
Subsidiaries, or any of their respective properties, businesses, assets or
revenues, which may materially adversely affect the financial condition,
operations, assets, business, properties or prospects of the Borrower or any
Subsidiary or which purports to affect the legality, validity or
enforceability of this Agreement, the Notes or any other Loan Document,
except as disclosed in ITEM 6.7 ("Litigation") of the Disclosure Schedule.
SECTION 6.8 SUBSIDIARIES. The Borrower has no Subsidiaries,
except those Subsidiaries (a) which are identified in ITEM 6.8 ("Existing
Subsidiaries") of the Disclosure Schedule; or (b) which are permitted to have
been acquired in accordance with SECTION 7.2.5 or 7.2.8.
SECTION 6.9 OWNERSHIP OF PROPERTIES. The Borrower and each of its
Subsidiaries owns good and marketable title to all of its properties and
assets, real and personal, tangible and intangible, of any nature whatsoever
(including patents, trademarks, trade names, service marks and copyrights),
free and clear of all Liens, charges or claims (including infringement claims
with respect to patents, trademarks, copyrights and the like) except as
permitted pursuant to SECTION 7.2.3.
SECTION 6.10 TAXES. The Borrower and each of its Subsidiaries has
filed all tax returns and reports required by law to have been filed by it
and has paid all taxes and governmental charges thereby shown to be owing,
except any such taxes or charges which are being diligently contested in good
faith by appropriate proceedings and for which adequate reserves in
accordance with GAAP shall have been set aside on its books.
SECTION 6.11 PENSION AND WELFARE PLANS. During the
twelve-consecutive-month period prior to the date of the execution and
delivery of this Agreement and prior to the date of any Borrowing hereunder,
no steps have been taken to terminate any Pension Plan, and no contribution
failure has occurred with respect to any Pension Plan sufficient to give rise
to a Lien under section 302(f) of ERISA. No condition exists or event or
transaction has occurred with respect to any Pension Plan which might result
in the incurrence by the Borrower or any member of the Controlled Group of
any material liability, fine or penalty. Except as disclosed in
46
ITEM 6.11 ("Employee Benefit Plans") of the Disclosure Schedule, neither the
Borrower nor any member of the Controlled Group has any contingent liability
with respect to any post-retirement benefit under a Welfare Plan, other than
liability for continuation coverage described in Part 6 of Title I of ERISA.
SECTION 6.12 COMPLIANCE WITH LAW. Neither the Borrower nor any of
its Subsidiaries (a) is in violation of any law, statute, ordinance, decree,
requirement, order, judgment, rule, regulation (or any interpretation of the
foregoing) of, or the terms of any license or permit issued by, any
governmental authority; or (b) has failed to obtain any license, permit,
franchise or other governmental authorization necessary to ownership of any
of their respective properties or the conduct of their respective business;
which violation or failure could reasonably be expected to have a Material
Adverse Effect.
SECTION 6.13 CLAIMS AND LIABILITIES. Except as disclosed to the
Lenders in the Disclosure Schedule, neither the Borrower nor any of its
Subsidiaries has accrued any liabilities under gas purchase contracts for gas
not taken, but for which it is liable to pay if not made up and which, if not
paid, would have a Material Adverse Effect. Except as disclosed to the
Lenders in the Disclosure Schedule, no claims exist against the Borrower or
its Subsidiaries for gas imbalances which claims if adversely determined
would have a Material Adverse Effect. Except as disclosed to the Lenders in
the Disclosure Schedule, no purchaser of product supplied by the Borrower or
any of its Subsidiaries has any claim against the Borrower or any of its
Subsidiaries for product paid for, but for which delivery was not taken as
and when paid for, which claim if adversely determined would have a Material
Adverse Effect.
SECTION 6.14 NO PROHIBITION ON PERFECTION OF COLLATERAL DOCUMENTS.
None of the terms or provisions of any indenture, mortgage, deed of trust,
agreement or other instrument to which the Borrower or any of its
Subsidiaries is a party or by which the Borrower or any of its Subsidiaries
or the property of the Borrower or any of its Subsidiaries is bound prohibit
the filing or recordation of any of the Loan Documents or any other action
which is necessary or appropriate in connection with the perfection or
maintenance of the Liens evidenced and created by any of the Loan Documents.
SECTION 6.15 SOLVENCY.
(a) Neither the Borrower nor the Borrower and its
Subsidiaries, on a consolidated basis, is "insolvent," as such term is
used and defined in the United States Bankruptcy Code, 11 U.S.C. Section
101, ET SEQ.
(b) Immediately after the making of each Loan, if any, and
issuance of any Letter of Credit, if any, made or issued, as the case may
be, and after giving effect to the application of the proceeds of such
Loans and Letters of Credit, (i) the value of the assets
47
of the Borrower and its Subsidiaries on a consolidated basis, at a fair
valuation, will exceed the debts and liabilities, subordinated,
contingent or otherwise, of the Borrower and its Subsidiaries on a
consolidated basis; (ii) the present fair salable value of the property
of the Borrower and the Subsidiaries on a consolidated basis will be
greater than the amount that will be required to pay the probable
liability of the Borrower and its Subsidiaries on a consolidated basis
on their debts and other liabilities, subordinated, contingent or
otherwise, as such debts and other liabilities become absolute and
matured; (iii) the Borrower and its Subsidiaries on a consolidated
basis will be able to pay their debts and liabilities, subordinated,
contingent or otherwise, as such debts and liabilities become absolute
and matured; and (iv) the Borrower and its Subsidiaries on a consolidated
basis will not have unreasonably small capital with which to conduct the
businesses in which they are engaged as such businesses are now conducted
and are proposed to be conducted after the date hereof.
(c) The Borrower does not intend to, or to permit any of its
Subsidiaries to, and does not believe that it or any of its Subsidiaries
will, incur debts beyond its ability to pay such debts as they mature,
taking into account the timing of and amounts of cash to be received by
it or any such Subsidiary and the timing of the amounts of cash to be
payable on or in respect of its Indebtedness or the Indebtedness of any
such Subsidiary.
SECTION 6.16 ENVIRONMENTAL WARRANTIES. In the ordinary course of
its business, the Borrower conducts an ongoing review of the effect of
Environmental Laws on the business, operations and properties of the Borrower
and its Subsidiaries, in the course of which it identifies and evaluates
associated liabilities and costs (including any capital or operating
expenditures required for clean-up or closure of properties presently owned
or operated, any capital or operating expenditures required to achieve or
maintain compliance with environmental protection standards imposed by law or
as a condition of any license, permit or contract, any related constraints on
operating activities, including any periodic or permanent shutdown of any
facility or reduction in the level of or change in the nature of operations
conducted thereat and any actual or potential liabilities to third parties,
including employees, and any related costs and expenses). On the basis of
this review , the Borrower has reasonably concluded that, except as disclosed
in ITEM 6.16 ("Environmental Matters") of the Disclosure Schedule, to the
best of its knowledge after due inquiry:
(a) all facilities and property (including underlying
groundwater) owned, leased or operated by the Borrower or any of its
Subsidiaries are owned, leased or operated by the Borrower and its
Subsidiaries in material compliance with all Environmental Laws;
(b) there are no pending or threatened and to Borrower's
knowledge there have been no past, continuing (i) claims, complaints,
notices or inquiries to, or requests
48
for information received by, the Borrower or any of its Subsidiaries
with respect to any alleged violation of any Environmental Law, that,
singly or in the aggregate, have or may reasonably be expected to have
a Material Adverse Effect, or (ii) claims, complaints, notices or
inquiries to, or requests for information received by, the Borrower or
any of its Subsidiaries regarding potential liability under any
Environmental Law or under any common law theories relating to operations
or the condition of any facilities or property (including underlying
groundwater) owned, leased or operated by the Borrower and its
Subsidiaries that, singly or in the aggregate, have, or may reasonably be
expected to have a Material Adverse Effect;
(c) there have been no Releases of Hazardous Materials at,
on or under any property now or previously owned or leased by the
Borrower or any of its Subsidiaries that, singly or in the aggregate,
have, or may reasonably be expected to have, a Material Adverse Effect;
(d) the Borrower and its Subsidiaries have been issued and
are in material compliance with all permits, certificates, approvals,
licenses and other authorizations relating to environmental matters and
necessary or desirable for their businesses;
(e) no property now or previously owned, leased or operated
by the Borrower or any of its Subsidiaries is listed or proposed for
listing on the National Priorities List pursuant to CERCLA, or, to the
extent that such listing may, singly or in the aggregate, have, or may
reasonably be expected to have a Material Adverse Effect, on the CERCLIS
or on any other federal or state list of sites requiring investigation or
clean-up;
(f) there are no underground storage tanks, active or
abandoned, including petroleum storage tanks, on or under any property
now or previously owned, leased or operated by the Borrower or any of its
Subsidiaries that, singly or in the aggregate, have, or may reasonably be
expected to have, a Material Adverse Effect;
(g) none of the Borrower or any of its Subsidiaries has
directly transported or directly arranged for the transportation of any
Hazardous Material to any location which is listed or proposed for
listing on the National Priorities List pursuant to CERCLA, or, to the
extent that such listing may, singly or in the aggregate, have, or may
reasonably be expected to have a Material Adverse Effect, on the CERCLIS
or on any federal or state list or which is the subject of federal, state
or local enforcement actions or other investigations which may lead to
material claims against the Borrower or any of its Subsidiaries for any
remedial work, damage to natural resources or personal injury, including
claims under CERCLA;
49
(h) there are no polychlorinated biphenyls, radioactive
materials or friable asbestos present at any property now or previously
owned or leased by the Borrower or any of its Subsidiaries that, singly
or in the aggregate, have, or may reasonably be expected to have, a
Material Adverse Effect; and
(i) no condition exists at, on or under any property now or
previously owned or leased by the Borrower or any of its Subsidiaries
which, with the passage of time, or the giving of notice or both, would
give rise to material liability under any Environmental Law that, singly
or in the aggregate have, or may reasonably be expected to have a
Material Adverse Effect.
SECTION 6.17 REGULATIONS G, U AND X. The Borrower is not engaged
in the business of extending credit for the purpose of purchasing or carrying
margin stock, and no proceeds of any Loans will be used for a purpose which
violates, or would be inconsistent with, F.R.S. Board Regulation G, U or X.
Terms for which meanings are provided in F.R.S. Board Regulation G, U or X or
any regulations substituted therefor, as from time to time in effect, are
used in this Section with such meanings.
SECTION 6.18 ACCURACY OF INFORMATION. All factual information
heretofore or contemporaneously furnished by or on behalf of the Borrower in
writing to the Administrative Agent or any Lender for purposes of or in
connection with this Agreement or any transaction contemplated hereby is, and
all other such factual information hereafter furnished by or on behalf of the
Borrower to the Administrative Agent or any Lender will be, true and accurate
in every material respect on the date as of which such information is dated
or certified and as of the date of execution and delivery of this Agreement
by the Administrative Agent and such Lender, and such information is not, or
shall not be, as the case may be, incomplete by omitting to state any
material fact necessary to make such information not misleading. All
estimates and projections delivered to the Administrative Agent or any Lender
are or will be based upon information that was available at such time and
believed to be correct and upon assumptions believed to be reasonable;
however the Borrower does not warrant that such estimates and projections
will ultimately prove to have been accurate.
SECTION 6.19 DEFAULT. No Default or Event of Default has occurred
and is continuing.
SECTION 6.20 YEAR 2000 PROBLEM. On the basis of a comprehensive
review and assessment of the Borrower's and its Subsidiaries' systems and
equipment and inquiry made of the Borrower's and its Subsidiaries' material
suppliers, vendors and customers, the Borrower reasonably believes that the
"Year 2000 problem" (that is, the inability of computers, as well as embedded
microchips in non-computing devices, to perform properly date-sensitive
functions with respect to certain dates prior to and after December 31, 1999)
("YEAR 2000 PROBLEM"),
50
including costs of remediation, will not result in a Material Adverse Effect.
The Borrower and its Subsidiaries have developed, or are in the process of
developing, reasonably feasible contingency plans adequately intended to
provide uninterrupted and unimpaired business operation in the event of
failure of their own or a third party's systems or equipment due to the Year
2000 Problem, including those vendors, customers, and suppliers, as well as a
general failure of or interruption in its communications and delivery
infrastructure.
SECTION 6.21 XXXXXXX PLANT. All assets of the Borrower maintained
on the Lands (as defined in the Xxxxxxx Mortgage), including, without
limitation, the Xxxxxxx Extraction Plant, (i) constitute "Goods" as defined
in Article 9 of the U.C.C., (ii) are not affixed to the Land and are
considered mobile Goods, and (iii) may be moved from the Lands to another
location and reinstalled without extraordinary cost and effort.
ARTICLE 7
COVENANTS
SECTION 7.1 AFFIRMATIVE COVENANTS. The Borrower agrees with the
Administrative Agent and each Lender that, until all Commitments have
terminated and all Obligations have been paid and performed in full, the
Borrower will perform the obligations set forth in this SECTION 7.1.
SECTION 7.1.1 FINANCIAL INFORMATION, REPORTS, NOTICES, ETC. The
Borrower will furnish, or will cause to be furnished, to the Administrative
Agent sufficient copies of the following financial statements, reports,
notices and information to provide one to each Lender:
(a) as soon as available and in any event within (i) (A) 30
days after the end of each month (other than December), and (B) within 45
days after the end of each December, a consolidated balance sheet of the
Borrower and its Subsidiaries as of the end of such month and
consolidated statements of earnings and cash flow of the Borrower and its
Subsidiaries for such month and for the period commencing at the end of
the previous Fiscal Year and ending with the end of such month, certified
by the chief financial Authorized Officer of the Borrower (ii) within 45
days of after the end of each of the first three quarters of each year,
the Borrower's form 10Q for such quarter, in each case together with a
report, in form and substance satisfactory to the Administrative Agent
and the Required Lenders, reconciling the Borrower's and its
Subsidiaries' actual performance to the most recent budgets and forecasts
delivered pursuant to SECTION 5.1.12 or SECTION 7.1.1(h) or (i), as the
case may be, certified by the Chief Financial Officer of the Borrower and
containing an explanation in reasonable detail for any significant
negative variances;
51
(b) as soon as available and in any event within 90 days
after the end of each Fiscal Year of the Borrower, a copy of the annual
audit report for such Fiscal Year for the Borrower and its Subsidiaries,
including therein consolidated balance sheets of the Borrower and its
Subsidiaries as of the end of such Fiscal Year and consolidated
statements of earnings and cash flow of the Borrower and its Subsidiaries
for such Fiscal Year, certified (without any "going concern"
qualification, qualification relating to possible errors generated by
financial reporting and related systems due to the Year 2000 Problem, or
other qualification) in a manner acceptable to the Administrative Agent
and the Required Lenders by Price Waterhouse LLP or other independent
public accountants acceptable to the Administrative Agent and the
Required Lenders, together with certificates from such accountants
containing (x) a report on management's assertion about compliance
(together with management's computation of, and showing compliance) with
each of the financial ratios and restrictions contained in SECTION 7.2.4
and (y) to the effect that, in making the examination necessary for the
signing of such annual report by such accountants, they have not become
aware of any Default or Event of Default that has occurred and is
continuing, or, if they have become aware of such Default or Event of
Default, describing such Default or Event of Default and the steps, if
any, being taken to cure it; timely delivery of Form 10-K pursuant to
clause (f) below shall be deemed to satisfy this clause (b).
(c) as soon as available and in any event within 45 days
after the end of each Fiscal Quarter, a certificate in the form of
EXHIBIT F, executed by the chief financial Authorized Officer of the
Borrower, showing (in reasonable detail and with appropriate calculations
and computations in all respects satisfactory to the Administrative
Agent) compliance with the financial covenants set forth in SECTION 7.2.4
and SECTION 3.1.4 and setting forth such information as is required in
such form;
(d) as soon as possible and in any event within three
Business Days after the Borrower obtains knowledge of the occurrence of
each Default, a statement of the chief financial Authorized Officer of
the Borrower setting forth details of such Default and the action which
the Borrower has taken and proposes to take with respect thereto;
(e) as soon as possible and in any event within three (3)
Business Days after the Borrower obtains knowledge of any of the
following if it could reasonably be expected to result in a Material
Adverse Effect if adversely determined: (x) the occurrence of any adverse
development with respect to any litigation, action, proceeding, or labor
controversy described in SECTION 6.7, (y) the commencement of any labor
controversy, litigation, action, proceeding of the type described in
SECTION 6.7, notice thereof and copies of all documentation relating
thereto or (z) any adverse development involving, or material
52
default by any party under, or breach by any party of any material
contract or agreement to which the Borrower or any Subsidiary is a
party or by which it is bound;
(f) promptly after the sending or filing thereof, copies of
all reports which the Borrower sends to any of its security holders, and
all reports and registration statements (without exhibits) which the
Borrower or any of its Subsidiaries files with the Securities and
Exchange Commission or any national securities exchange, including,
without limitation, any reports or registration statements relating to
the Year 2000 Problem;
(g) within three (3) Business Days upon becoming aware of
the institution of any steps by the Borrower or any other Person to
terminate any Pension Plan, or the failure to make a required
contribution to any Pension Plan if such failure is sufficient to give
rise to a Lien under section 302(f) of ERISA, or the taking of any action
with respect to a Pension Plan which could result in the requirement that
the Borrower furnish a bond or other security to the PBGC or such Pension
Plan, or the occurrence of any event with respect to any Pension Plan
which could result in the incurrence by the Borrower of any material
liability, fine or penalty, or any material increase in the contingent
liability of the Borrower with respect to any post-retirement Welfare
Plan benefit, notice thereof and copies of all documentation relating
thereto;
(h) (i) annually, on or before March 31 of each year and
(ii) promptly upon request of the Administrative Agent or the Required
Lenders (which requests may not be more frequent than once each quarter),
a budget for the year commencing the preceding January 1 and a five-year
forecast for the Borrower and its Subsidiaries in form and substance
satisfactory to the Administrative Agent and the Required Lenders and
consistent with the budget and projections delivered pursuant to
SECTION 5.1.12 and based upon information that is then currently
available and believed to be correct and upon assumptions believed to be
reasonable;
(i) The Borrower shall deliver to the Administrative Agent,
(a) promptly upon sending or receipt, copies of any and all management
letters and correspondence relating to management letters, sent or
received by the Borrower or any of its Subsidiaries to or from Price
Waterhouse LLP or other independent public accountants acceptable to the
Administrative Agent and the Required Lenders, and (b) upon the request
of the Administrative Agent, a copy of the Borrower's and its
Subsidiaries' plan, timetable and budget to address the Year 2000
Problem, together with periodic updates thereof and expenses incurred to
date, any third party assessment of the Borrower's and its Subsidiaries'
Year 2000 Problem remediation efforts, and any Year 2000 Problem
contingency plans, and any estimates of the Borrower's and its
Subsidiaries potential litigation exposure (if any) to the Year 2000
Problem;
53
(j) such other information respecting the condition or
operations, financial or otherwise, or properties or assets of the
Borrower or any of its Subsidiaries as any Lender through the
Administrative Agent may from time to time reasonably request in writing.
SECTION 7.1.2 COMPLIANCE WITH LAWS, ETC. The Borrower will, and
will cause each of its Subsidiaries to, comply in all material respects with
all applicable laws, rules, regulations and orders (including Environmental
Laws), such compliance to include, without limitation, (a) the maintenance
and preservation of its corporate, partnership or limited liability company
existence and qualification as a foreign corporation, partnership or limited
liability company; and (b) the payment, before the same become delinquent, of
all taxes, assessments and governmental charges imposed upon it or upon its
property except to the extent being diligently contested in good faith by
appropriate proceedings and for which adequate reserves in accordance with
GAAP shall have been set aside on its books.
SECTION 7.1.3 MAINTENANCE OF PROPERTIES. The Borrower will, and
will cause each of its Subsidiaries to, maintain, preserve, protect and keep
its properties in good repair, working order and condition, and make
necessary and proper repairs, renewals and replacements so that its business
carried on in connection therewith may be properly conducted at all times
unless the Borrower determines in good faith that the continued maintenance
of any of its properties is no longer economical.
SECTION 7.1.4 INSURANCE. The Borrower will, and will cause each of
its Subsidiaries to, maintain or cause to be maintained with responsible
insurance companies insurance with respect to its properties and business
(including business interruption insurance) against such casualties and
contingencies and of such types and in such amounts as is customary in the
case of similar businesses and which is satisfactory to the Administrative
Agent and the Required Lenders and will (i) furnish to the Administrative
Agent on each anniversary of the Effective Date a certificate or certificates
of insurance from Borrower's insurance companies evidencing the existence of
all insurance required to be maintained by the Borrower by this Agreement and
the other Loan Documents and that Administrative Agent is listed as
additional insured and sole loss payee and (ii) upon request of the
Administrative Agent, furnish to each Lender at reasonable intervals a
certificate of an Authorized Officer of the Borrower setting forth the nature
and extent of all insurance maintained by the Borrower and its Subsidiaries
in accordance with this Section.
Except as the Administrative Agent may otherwise consent to in
writing, Borrower will, and will cause each of its Subsidiaries to, forthwith
upon receipt, transmit and deliver to the Administrative Agent, in the form
received, all cash, checks, drafts, chattel paper and other instruments or
writings for the payment of money (properly endorsed, where required, so that
such items may be collected by the Administrative Agent) which may be
received by the Borrower at any time in full or partial payment of amounts
due under any insurance policy.
54
Except as the Administrative Agent may otherwise consent in writing, any such
items which may be received by the Borrower will not be commingled with any
other of its funds or property, but will be held separate and apart from its
own funds or property and upon express trust for the Administrative Agent
until delivery is made to the Administrative Agent. Borrower will comply
with the terms and conditions of any consent given by the Administrative
Agent pursuant to the provisions of this paragraph.
All items or amounts which are delivered by the Borrower or by any
insurance company to the Administrative Agent on account of partial or full
payment of amounts due under any insurance policy shall be deposited to the
credit of a deposit account (herein called the "INSURANCE DEPOSIT ACCOUNT")
of the Borrower with the Administrative Agent, as security for payment of the
Obligations. Borrower shall have no right to withdraw any funds deposited in
the Insurance Deposit Account. Administrative Agent will apply all or any of
the then balance in the Insurance Deposit Account toward payment of the
Obligations, in such order of application as the Administrative Agent may
determine. Administrative Agent may, from time to time, in its reasonable
discretion and with the consent of the Required Lenders, release all or any
of such balance representing collected funds to the Borrower. Administrative
Agent is authorized to endorse, in the name of the Borrower, any item,
howsoever received by the Administrative Agent, representing any payment
under any insurance policy.
SECTION 7.1.5 BOOKS AND RECORDS. The Borrower will, and will cause
each of its Subsidiaries to, keep books and records which accurately reflect
all of its business affairs and transactions and permit the Administrative
Agent and each Lender or any of their respective representatives, at
reasonable times and intervals, to visit all of its offices and properties,
to discuss its financial matters with its officers and independent public
accountant (and the Borrower hereby authorizes such independent public
accountant to discuss the Borrower's financial matters with each Lender or
its representatives with a representative of the Borrower present) and to
examine (and, at the expense of the Borrower, photocopy extracts from) any of
its books or other corporate records. The Borrower shall pay any fees of
such independent public accountant incurred in connection with the
Administrative Agent's or any Lender's exercise of its rights pursuant to
this Section.
SECTION 7.1.6 ENVIRONMENTAL COVENANT. The Borrower will, and will
cause each of its Subsidiaries to, (a) use and operate all of its facilities
and properties in material compliance with all Environmental Laws, keep all
necessary permits, approvals, certificates, licenses and other authorizations
relating to environmental matters in effect and remain in material compliance
therewith, and handle all Hazardous Materials in material compliance with all
applicable Environmental Laws; and (b) provide such information and
certifications which the Administrative Agent may reasonably request from
time to time to evidence compliance with this SECTION 7.1.6; provided that
neither the Administrative Agent nor any Lender shall have any obligation to
make any inquiries pursuant to this SECTION 7.1.6.
55
SECTION 7.1.7 FURTHER ASSURANCES; ADDITIONAL COLLATERAL. The
Borrower shall cause each Subsidiary (other than Inverness), from time to
time, to become an Obligor with respect to, and jointly and severally liable
with all other Obligors for, all the Obligations under this Agreement and the
Notes and the other Loan Documents by promptly executing and delivering to
the Lenders a Guaranty substantially in the form of EXHIBIT G hereto, with
appropriate insertions, and by causing such Subsidiary's, as the case may be,
capital stock, partnership, joint venture or membership interest to be
pledged pursuant to a Pledge Agreement substantially in the form of EXHIBIT N
hereto, with appropriate insertions. In addition, the Borrower shall and
shall cause its Subsidiaries, upon the reasonable request of the
Administrative Agent, to take such actions and to execute and deliver such
documents and instruments as the Administrative Agent shall require to ensure
that the Administrative Agent shall, at all times, have received currently
effective duly executed Loan Documents encumbering all of the Borrower's and
its Subsidiaries' material assets and properties, both tangible and
intangible, both personal and real, together with current valuations,
appraisals and engineering reports and satisfactory title evidence, including
title opinions or title insurance in form and substance reasonably acceptable
to the Administrative Agent in its reasonable business judgment as to
ownership of such assets and properties. If the Administrative Agent shall
determine that, as of any date, the Borrower shall have failed to comply with
the preceding sentences, the Administrative Agent may (and at the direction
of the Required Lenders, shall) notify the Borrower in writing of such
failure and, within 30 days from and after receipt of such written notice by
the Borrower, the Borrower shall execute and deliver to the Administrative
Agent supplemental or additional Loan Documents, in form and substance
satisfactory to the Administrative Agent and its counsel, securing payment of
the Notes and the other Obligations and covering additional assets and
properties not then encumbered by any Loan Documents (together with current
valuations, engineering reports, appraisals, and title opinions or insurance
applicable to the additional assets and properties collaterally assigned,
each of which shall be in form and substance satisfactory to the
Administrative Agent) such that the Administrative Agent shall have received
currently effective duly executed and perfected Collateral Documents
encumbering substantially all of the assets and properties of the Borrower
and its Subsidiaries.
SECTION 7.1.8 COMPLIANCE WITH HEDGING POLICY. Borrower shall at all
times comply with, and perform any and all obligations and actions set forth
in, the terms and provisions of the Hedging Policy.
SECTION 7.1.9 HEDGING AGREEMENTS. Borrower shall, and shall cause
each of its Subsidiaries to, (i) as soon as available and in any event within
(A) 30 days after the end of each month (other than December), and (B) within
45 days after the end of each December, deliver to the Administrative Agent a
summary of all existing Hedging Agreement entered into by Borrower or any of
its Subsidiaries, including, without limitation, the amount of the Hedging
Obligation, the quantity of hedged volumes and the hedged price relating to
each such Hedging
56
Agreement, and the Counterparty for each such Hedging Agreement, and (ii) at
the request of the Administrative Agent, provide the Administrative Agent
with a copy of such Hedging Agreement, any related confirmations and/or any
similar documentation for each such Hedging Agreement.
SECTION 7.2 NEGATIVE COVENANTS. The Borrower agrees with the
Administrative Agent and each Lender that, until all Commitments have
terminated and all Obligations have been paid and performed in full, the
Borrower will perform the obligations set forth in this SECTION 7.2.
SECTION 7.2.1 BUSINESS ACTIVITIES. The Borrower will not, and will
not permit any of its Subsidiaries to, engage in any business activity,
except those described in the FIRST RECITAL and such activities as may be
incidental or related thereto; provided that any material change after the
date hereof in the Borrower's natural gas, natural gas liquids and crude oil
marketing business or Hedging Policy (including any net open position) will
be subject to prior review by the Lenders.
SECTION 7.2.2 INDEBTEDNESS. The Borrower will not, and will not
permit any of its Subsidiaries to, create, incur, assume or suffer to exist
or otherwise become or be liable in respect of any Indebtedness, other than,
without duplication, the following: (a) Indebtedness in respect of the Loans
and other Obligations; (b) until the date of the initial Borrowing,
Indebtedness identified in ITEM 7.2.2(b) ("Indebtedness to be Paid") of the
Disclosure Schedule; (c) Indebtedness existing as of the Effective Date which
is identified in ITEM 7.2.2(c) ("Ongoing Indebtedness") of the Disclosure
Schedule; (d) until the sale by Borrower the office building located at 155
Inverness, Englewood, Colorado, Indebtedness in an aggregate principal amount
not to exceed $5,000,000 at any time outstanding which was incurred by
Borrower to finance its acquisition of such office building; (e) unsecured
Indebtedness incurred in the ordinary course of business consisting of open
accounts extended by suppliers and customers on normal trade terms in
connection with purchases or sales of goods and services, but excluding
Indebtedness incurred through the borrowing of money or Contingent
Liabilities; (f) Indebtedness in respect of Capitalized Lease Liabilities to
the extent permitted by SECTION 7.2.7; (g) other unsecured Indebtedness of
the Borrower and its Subsidiaries in an aggregate amount not to exceed
$5,000,000, (h) Indebtedness between the Borrower and its Subsidiaries and
between the Borrower's Subsidiaries provided such Indebtedness is evidenced
by a promissory note; (i) Indebtedness resulting from any Hedging
Obligations; and (j) Indebtedness arising in respect of the West Shore/Basin
Purchase Agreement; PROVIDED, HOWEVER, notwithstanding the foregoing, that
the Borrower will not, and will not permit any of its Subsidiaries to,
create, incur, assume or otherwise become or be liable in respect of any
additional Indebtedness otherwise permitted by CLAUSE (g) if, after giving
effect to the incurrence thereof, any Default or requirement to make any
mandatory prepayment shall have occurred and be continuing.
57
SECTION 7.2.3 LIENS. The Borrower will not, and will not permit any
of its Subsidiaries to, create, incur, assume or suffer to exist any Lien
upon any of its property, revenues or assets, whether now owned or hereafter
acquired, except: (a) Liens securing payment of the Obligations, granted
pursuant to any Loan Document; (b) Liens securing payment of Indebtedness of
the type permitted and described in CLAUSE (b) of SECTION 7.2.2; (c) Liens
granted prior to the Effective Date to secure payment of Indebtedness of the
type permitted and described in CLAUSE (c) of SECTION 7.2.2; (d) Liens
granted to secure payment of Indebtedness of the type permitted and described
in CLAUSE (d) of SECTION 7.2.2 and covering only those assets acquired with
the proceeds of such Indebtedness; (e) Liens for taxes, assessments or other
governmental charges or levies not at the time delinquent or thereafter
payable without penalty or being diligently contested in good faith by
appropriate proceedings and for which adequate reserves in accordance with
GAAP shall have been set aside on its books; (f) Liens of carriers,
warehousemen, mechanics, materialmen and landlords incurred in the ordinary
course of business for sums not overdue or being diligently contested in good
faith by appropriate proceedings and for which adequate reserves in
accordance with GAAP shall have been set aside on its books; (g) Liens
incurred in the ordinary course of business in connection with workmen's
compensation, unemployment insurance or other forms of governmental insurance
or benefits, or to secure performance of tenders, statutory obligations,
leases and contracts (other than for borrowed money) entered into in the
ordinary course of business or to secure obligations on surety or appeal
bonds; (h) judgment Liens in existence less than 30 days after the entry
thereof or with respect to which execution has been stayed or the payment of
which is covered in full (subject to a customary deductible) by insurance
maintained with responsible insurance companies; (i) hydrocarbon or natural
gas sales contracts liens reserved in customary oil and gas leases for bonus
or rental payments, royalties, overriding royalties and joint operating
agreements; (j) covenants, restrictions, easements, servitudes, permits,
conditions, exceptions, reservations, minor rights, minor encumbrances, minor
irregularities in title or conventional rights of reassignment prior to
abandonment which do not materially interfere with the occupation, use and
enjoyment by the Borrower or any of its Subsidiaries of its respective assets
in the ordinary course of business as presently conducted, or materially
impair the value thereof for the purpose of such business; and (k) Liens
securing Indebtedness and other obligations not to exceed in the aggregate at
any time outstanding the difference of $5,000,000 MINUS the amount of
indebtedness secured by Liens permitted by the foregoing clause (d).
SECTION 7.2.4 FINANCIAL COVENANTS. The Borrower will not permit:
(a) Its Tangible Net Worth to be less than $42,000,000 PLUS
50% of consolidated net income of the Borrower and its Subsidiaries, if
positive, for any calendar quarter, beginning with the calendar quarter
beginning on January 1, 1999, and calculated quarterly thereafter based
upon positive consolidated net income of the Borrower and its
Subsidiaries for each subsequent Fiscal Quarter PLUS 85% of the proceeds
received after January 1, 1999 of the issuance of any Securities (other
than securities representing
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Indebtedness), net of reasonable and customary expenses of issuance
thereof, by the Borrower or any of its Subsidiaries (other than by a
Subsidiary to the Borrower or another wholly-owned Subsidiary of the
Borrower).
(b) Its Current Ratio to be less than 1:1 at any time.
SECTION 7.2.5 INVESTMENTS. The Borrower will not, and will not
permit any of its Subsidiaries to, make, incur, assume or suffer to exist any
Investment in any other Person, except: (a) Investments existing on the
Effective Date and identified in ITEM 7.2.5(a) ("Ongoing Investments") of the
Disclosure Schedule; (b) Cash Equivalent Investments; (c) without
duplication, Investments permitted as Indebtedness pursuant to SECTION 7.2.2;
(d) investments permitted by SECTION 4.10, SECTION 7.2.8 or Section 7.2.14;
or (e) in the ordinary course of business, Investments by the Borrower in any
of its Subsidiaries which have delivered a Guaranty, or by any such
Subsidiary in any of its other Subsidiaries which have delivered a Guaranty,
by way of contributions to capital or loans or advances; PROVIDED, HOWEVER,
that (i) any Investment which when made complies with the requirements of the
definition of the term "CASH EQUIVALENT INVESTMENT" may continue to be held
notwithstanding that such Investment if made thereafter would not comply with
such requirements (ii) no Investment otherwise permitted by CLAUSE (b) shall
be permitted to be made if, immediately before or after giving effect
thereto, any Default shall have occurred and be continuing and (iii) any
Investment otherwise permitted by clause (d) in an entity engaged in or to be
engaged in the natural gas, natural gas liquids or crude oil or other energy
marketing business shall be structured in a manner acceptable to the Lenders.
Upon completion of any such investment, the definition of EBITDA shall be
revised in a manner acceptable to all of the Lenders, in their sole
discretion.
SECTION 7.2.6 RESTRICTED PAYMENTS, ETC. On and at all times after
the Effective Date, (a) the Borrower will not declare, pay or make any
dividend or distribution (in cash, property or obligations) on any shares of
any class of capital stock (now or hereafter outstanding) of the Borrower or
on any warrants, options or other rights with respect to any shares of any
class of capital stock (now or hereafter outstanding) of the Borrower (other
than dividends or distributions payable in its common stock or warrants to
purchase its common stock or splitups or reclassifications of its stock into
additional or other shares of its common stock) or apply, or permit any of
its Subsidiaries to apply, any of its funds, property or assets to the
purchase, redemption, sinking fund or other retirement of, or agree or permit
any of its Subsidiaries to purchase or redeem, any shares of any class of
capital stock (now or hereafter outstanding) of the Borrower, or warrants,
options or other rights with respect to any shares of any class of capital
stock (now or hereafter outstanding) of the Borrower if the aggregate amount
of such dividends, distributions and applications for the current and the
preceding three Fiscal Quarters exceeds the lesser of (i) 50% of consolidated
net income of the Borrower and its Subsidiaries for the current and the
preceding three Fiscal Quarters or (ii) $1,000,000, PROVIDED, HOWEVER, that,
notwithstanding the foregoing and only with respect to activities required or
permitted under the
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MarkWest 401(k) Plan, Borrower shall be permitted to purchase or redeem up to
$250,000 in the aggregate per annum of shares of any class of capital stock
(now or hereafter outstanding) of the Borrower on the open-market or held in
Borrower's 401(K), and (b) the Borrower will not, and will not permit any
Subsidiary to, make any deposit for any of the foregoing purposes.
SECTION 7.2.7 RENTAL OBLIGATIONS. The Borrower will not, and will
not permit any of its Subsidiaries to, enter into at any time any arrangement
(excluding oil and gas leases entered into in the ordinary course of
business) which does not create a Capitalized Lease Liability and which
involves the leasing by the Borrower or any of its Subsidiaries from any
lessor of any real or personal property (or any interest therein) including
pursuant to any sale-leaseback transaction, except arrangements which,
together with all other such arrangements which shall then be in effect, will
not require the payment of an aggregate amount of rentals by the Borrower and
its Subsidiaries in excess of (excluding escalations resulting from a rise in
the consumer price or similar index) $7,000,000 during the full remaining
term of such arrangements; PROVIDED, HOWEVER, that any calculation made for
purposes of this Section for any period shall exclude any payments relating
to office rentals arising in connection with the Borrower's sale of the
building located at 155 Inverness in Englewood, Colorado which do not exceed
the sum of (i) $540,000 per Fiscal Year PLUS the Borrower's pro rata share of
the amount of the increase in the "operating expenses" for each Fiscal Year
as set forth in the applicable lease; and PROVIDED FURTHER that any
calculation made for purposes of this Section shall exclude any amounts
required to be expended for maintenance and repairs, insurance, taxes,
assessments, and other similar charges.
SECTION 7.2.8 CONSOLIDATION, MERGER, ETC. The Borrower will not,
and will not permit any of its Subsidiaries to, liquidate or dissolve,
consolidate with, or merge into or with, any other corporation, or purchase
or otherwise acquire all or substantially all of the assets of any Person (or
of any division thereof) except (a) any such Subsidiary may liquidate or
dissolve voluntarily into, and may merge with and into, the Borrower or any
other Subsidiary, and the assets or stock of any Subsidiary may be purchased
or otherwise acquired by the Borrower or any other Subsidiary; and (b) so
long as no Default has occurred and is continuing or would occur after giving
effect thereto, the Borrower or any of its Subsidiaries may purchase all or
substantially all of the assets of any Person, or acquire such Person by
merger, if the Borrower (if a party to such merger) or such Subsidiary is the
survivor of such merger.
SECTION 7.2.9 ASSET DISPOSITIONS, ETC. The Borrower will not, and
will not permit any of its Subsidiaries to, sell, transfer, lease, contribute
or otherwise convey, or grant options, warrants or other rights with respect
to, all or any substantial part of its assets (including capital stock of
Subsidiaries) to any Person, unless such sale, transfer, lease, contribution
or conveyance is in the ordinary course of its business.
SECTION 7.2.10 [INTENTIONALLY OMITTED].
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SECTION 7.2.11 TRANSACTIONS WITH AFFILIATES. The Borrower will not,
and will not permit any of its Subsidiaries to, enter into, or cause, suffer
or permit to exist any arrangement or contract with any of its other
Affiliates unless such arrangement or contract is fair and equitable to the
Borrower or such Subsidiary and is an arrangement or contract of the kind
which would be entered into by a prudent Person in the position of the
Borrower or such Subsidiary with a Person which is not one of its Affiliates.
SECTION 7.2.12 NEGATIVE PLEDGES, RESTRICTIVE AGREEMENTS, ETC. The
Borrower will not, and will not permit any of its Subsidiaries to, enter into
any agreement (excluding this Agreement, any other Loan Document and any
agreement governing any Indebtedness permitted either by CLAUSE (b) of
SECTION 7.2.2 as in effect on the Effective Date or by CLAUSE (d) or CLAUSE
(f) of SECTION 7.2.2 as to the assets financed with the proceeds of such
Indebtedness) prohibiting the creation or assumption of any Lien upon its
properties, revenues or assets, whether now owned or hereafter acquired, or
the ability of the Borrower or any other Obligor to amend or otherwise modify
this Agreement or any other Loan Document or the ability of any Subsidiary
to make any payments, directly or indirectly, to the Borrower by way of
dividends, advances, repayments of loans or advances, reimbursements of
management and other intercompany charges, expenses and accruals or other
returns on investments, or any other agreement or arrangement which restricts
the ability of any such Subsidiary to make any payment, directly or
indirectly, to the Borrower.
SECTION 7.2.13 TRANSFER OF ASSETS. The Borrower will not, and will
not permit any of its Subsidiaries to, sell, convey, contribute or transfer
any asset (including, without limitation, any sale or assignment with or
without recourse of any receivable) whether or not such asset constitutes all
or a substantial part of its assets to any Subsidiary or Affiliate of such
Person other than in compliance with Section 7.2.11 and, except: (i)
retirement of assets in the ordinary course of business; (ii) the sale,
conveyance, contribution or transfer of any asset or assets having a fair
market value at the time of sale, conveyance, contribution or transfer of
$5,000,000 or less in the aggregate for all such sales, conveyances,
contributions and transfers in any calendar year; (iii) the sale of inventory
in the ordinary course of business, including in connection with hedge
agreements or pursuant to long-term contracts; (iv) any conveyance or
transfer by a Subsidiary of the Borrower to the Borrower, of the Borrower to
a Subsidiary which has executed and delivered a Guaranty or a Subsidiary of
the Borrower to another Subsidiary. The foregoing notwithstanding, the
Borrower shall not, nor shall the Borrower permit any of its Subsidiaries to,
transfer any assets, other than the sale of inventory and payment of trade
payables in the ordinary course of business, to any Person pursuant to this
SECTION 7.2.13 if an Event of Default or Default shall have occurred and be
continuing or would otherwise be existing after, or result from, any such
transfer.
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SECTION 7.2.14 ACQUISITIONS. The Borrower will not, nor will it
permit any Subsidiary to, use any of the proceeds of the Loans to purchase or
carry any "margin stock" (as defined in Regulation U) or to make any
acquisition except (i) acquisitions not involving "margin stock," where such
acquisition shall have been approved or consented to by the board of
directors or similar governing entity of the Person being acquired; (ii)
acquisitions involving "margin stock" where such acquisitions shall have been
approved or consented to by the board of directors or similar governing
entity of the Person being acquired; provided such acquisitions are in
compliance with SECTION 6.17 or (iii) acquisitions of not more than 5% of the
outstanding equity securities of any issuer (except the Borrower), whether or
not such securities are "margin stock"; provided that if such securities
constitute "margin stock" such acquisitions are in compliance with SECTIONS
4.10 and 6.17 and provided further that if such acquisitions are of the
Borrower's stock, such acquisitions are in compliance with SECTIONS 4.10 and
7.2.6.
ARTICLE 8
EVENTS OF DEFAULT
SECTION 8.1 LISTING OF EVENTS OF DEFAULT. Each of the following
events or occurrences described in this SECTION 8.1 shall constitute an
"EVENT OF DEFAULT."
SECTION 8.1.1 NON-PAYMENT OF OBLIGATIONS. The Borrower shall
default in the payment or prepayment when due of any principal of or interest
on any Loan, or the Borrower shall default (and such default shall continue
unremedied for a period of five days) in the payment when due of any
Commitment Fee or of any other Obligation.
SECTION 8.1.2 BREACH OF WARRANTY. Any representation or warranty of
the Borrower or any other Obligor made or deemed to be made hereunder or in
any other Loan Document executed by it or any other writing or certificate
furnished by or on behalf of the Borrower or any other Obligor to the
Administrative Agent or any Lender for the purposes of or in connection with
this Agreement or any such other Loan Document (including any certificates
delivered pursuant to ARTICLE 5) is or shall be incorrect when made in any
material respect.
SECTION 8.1.3 NON-PERFORMANCE OF CERTAIN COVENANTS AND OBLIGATIONS.
The Borrower shall default in the due performance and observance of any of
its obligations under SECTION 7.2 which default continues unremedied for 10
days.
SECTION 8.1.4 NON-PERFORMANCE OF OTHER COVENANTS AND OBLIGATIONS.
Any Obligor shall default in the due performance and observance of any other
agreement contained herein or in any other Loan Document executed by it, and
such default shall continue unremedied for a period of 30 days after notice
thereof shall have been given to the Borrower by the Administrative Agent or
any Lender.
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SECTION 8.1.5 DEFAULT ON OTHER INDEBTEDNESS. A default shall occur
in payment when due (subject to any applicable grace period), whether due by
acceleration or otherwise, of any Indebtedness (other than Indebtedness
described in SECTION 8.1.1) of the Borrower or any of its Subsidiaries or any
other Obligor having a principal amount, individually or in the aggregate, in
excess of $2,000,000, or a default shall occur in the performance or
observance of any obligation or condition with respect to such Indebtedness
if the effect of such default is to accelerate the maturity of any such
Indebtedness or such default shall continue unremedied for any applicable
period of time sufficient to permit the holder or holders of such
Indebtedness, or any trustee or agent for such holders, to cause such
Indebtedness to become due and payable prior to its expressed maturity.
SECTION 8.1.6 JUDGMENTS. Any judgment or order for the payment of
money in excess of $2,000,000 shall be rendered against the Borrower or any
of its Subsidiaries and either (a) enforcement proceedings shall have been
commenced by any creditor upon such judgment or order; or (b) there shall be
any period of 15 consecutive days during which a stay of enforcement of such
judgment or order, by reason of a pending appeal or otherwise, shall not be
in effect.
SECTION 8.1.7 PENSION PLANS. Any of the following events shall
occur with respect to any Pension Plan (a) the institution of any steps by
the Borrower, any member of its Controlled Group or any other Person to
terminate a Pension Plan if, as a result of such termination, the Borrower or
any such member could be required to make a contribution to such Pension
Plan, or could reasonably expect to incur a liability or obligation to such
Pension Plan, in excess of $2,000,000; or (b) a contribution failure occurs
with respect to any Pension Plan sufficient to give rise to a Lien under
section 302(f) of ERISA.
SECTION 8.1.8 CONTROL OF THE BORROWER. Any Change in Control shall
occur.
SECTION 8.1.9 BANKRUPTCY, INSOLVENCY, ETC. The Borrower or any of
its Subsidiaries shall (a) become insolvent or generally fail to pay, or
admit in writing its inability or unwillingness to pay, debts as they become
due; (b) apply for, consent to, or acquiesce in, the appointment of a
trustee, receiver, sequestrator or other custodian for the Borrower or any of
its Subsidiaries or any property of any thereof, or make a general assignment
for the benefit of creditors; (c) in the absence of such application, consent
or acquiescence, permit or suffer to exist the appointment of a trustee,
receiver, sequestrator or other custodian for the Borrower or any of its
Subsidiaries or for a substantial part of the property of any thereof, and
such trustee, receiver, sequestrator or other custodian shall not be
discharged within 60 days, provided that the Borrower, each Subsidiary hereby
expressly authorizes the Administrative Agent and each Lender to appear in
any court conducting any relevant proceeding during such 60-day period to
preserve, protect and defend their rights under the Loan Documents; (d)
permit or suffer to exist the commencement of any bankruptcy, reorganization,
debt arrangement or other case or
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proceeding under any bankruptcy or insolvency law, or any dissolution,
winding up or liquidation proceeding, in respect of the Borrower or any of
its Subsidiaries or any other Obligor, and, if any such case or proceeding is
not commenced by the Borrower or such Subsidiary, such case or proceeding
shall be consented to or acquiesced in by the Borrower or such Subsidiary or
shall result in the entry of an order for relief or shall remain for 60 days
undismissed, provided that the Borrower, each Subsidiary hereby expressly
authorizes the Administrative Agent and each Lender to appear in any court
conducting any such case or proceeding during such 60-day period to preserve,
protect and defend their rights under the Loan Documents; or (e) take any
corporate or partnership action authorizing, or in furtherance of, any of the
foregoing.
SECTION 8.1.10 IMPAIRMENT OF SECURITY, ETC. Except as a direct
result of the acts or omissions of the Administrative Agent or any Lender,
any Loan Document, or any Lien granted thereunder, shall (except in
accordance with its terms), in whole or in part, terminate, cease to be
effective or cease to be the legally valid, binding and enforceable
obligation of any Obligor party thereto; the Borrower, any other Obligor or
any other party shall, directly or indirectly, contest in any manner such
effectiveness, validity, binding nature or enforceability; or for a period of
ten days following the earlier of the date the Borrower has knowledge thereof
or the Borrower receives notice from the Administrative Agent or any Lender
thereof, any Lien securing any Obligation shall, in whole or in part, cease
to be a perfected first priority Lien, subject only to those exceptions
expressly permitted by such Loan Document.
SECTION 8.1.11 DEFAULT UNDER MATERIAL AGREEMENT. The Borrower or any
of its Subsidiaries shall default in or breach the performance or observance
of any provision of any material contract or agreement to which it is a party
or it or its property is bound if such default or breach could result in the
opinion of the Administrative Agent and the Required Lenders in a Material
Adverse Effect and if such default or breach is not cured within 30 days of
the Borrower's knowledge of such breach or default.
SECTION 8.1.12 [Intentionally omitted].
SECTION 8.1.13 DEFAULT ON HEDGING OBLIGATIONS PURSUANT TO LENDER
HEDGING AGREEMENTS. A default shall occur in payment when due (subject to
any applicable grace period), whether due by acceleration or otherwise, of
any Hedging Obligation of the Borrower or any of its Subsidiaries arising in
connection with a Lender Hedging Agreement, or a default shall occur in the
performance or observance of any obligation or condition with respect to such
Hedging Obligation if the effect of such default is to accelerate the
maturity of any such Hedging Obligation or such default shall continue
unremedied for any applicable period of time sufficient to permit the holder
or holders of such Hedging Obligation, or any trustee or Administrative Agent
for such holders, to cause such Hedging Obligation to become due and payable
prior to its expressed maturity.
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SECTION 8.2 ACTION IF BANKRUPTCY. If any Event of Default
described in CLAUSES (a) through (d) of SECTION 8.1.9 shall occur with
respect to the Borrower or any Obligor, the Commitments (if not theretofore
terminated) shall automatically terminate and the outstanding principal
amount of all outstanding Loans and all other Obligations shall automatically
be and become immediately due and payable, without notice or demand.
SECTION 8.3 ACTION IF OTHER EVENT OF DEFAULT. If any Event of
Default (other than any Event of Default described in CLAUSES (a) through (d)
of SECTION 8.1.9 with respect to the Borrower or any other Obligor) shall
occur for any reason, whether voluntary or involuntary, and be continuing,
the Administrative Agent, upon the direction of the Required Lenders, shall
by notice to the Borrower declare all or any portion of the outstanding
principal amount of the Loans and other Obligations to be due and payable
and/or the Commitments (if not theretofore terminated) to be terminated,
whereupon the full unpaid amount of such Loans and other Obligations which
shall be so declared due and payable shall be and become immediately due and
payable, without further notice, demand or presentment, and/or, as the case
may be, the Commitments shall terminate.
ARTICLE 9
THE AGENTS
SECTION 9.1 ACTIONS. Each Lender hereby appoints BofA as its
Administrative Agent and Syndication Agent under and for purposes of this
Agreement, the Notes and each other Loan Document. Each Lender authorizes
the Administrative Agent to act on behalf of such Lender under this
Agreement, the Notes and each other Loan Document and, in the absence of
other written instructions from the Required Lenders received from time to
time by the Administrative Agent (with respect to which the Administrative
Agent agrees that it will comply, except as otherwise provided in this
Section or as otherwise advised by counsel), to exercise such powers
hereunder and thereunder as are specifically delegated to or required of the
Administrative Agent by the terms hereof and thereof, together with such
powers as may be reasonably incidental thereto. Each Lender hereby
indemnifies (which indemnity shall survive any termination of this Agreement)
the Administrative Agent, PRO RATA according to such Lender's Percentage,
from and against any and all liabilities, obligations, losses, damages,
claims, costs or expenses of any kind or nature whatsoever which may at any
time be imposed on, incurred by, or asserted against, the Administrative
Agent in any way relating to or arising out of this Agreement, the Notes and
any other Loan Document, including reasonable attorneys' fees, and as to
which the Administrative Agent is not reimbursed by the Borrower; PROVIDED,
HOWEVER, that no Lender shall be liable for the payment of any portion of
such liabilities, obligations, losses, damages, claims, costs or expenses
which are determined by a court of competent jurisdiction in a final
proceeding to have resulted solely from the Administrative Agent's gross
negligence or wilful misconduct. The Administrative Agent shall not be
required to take any action hereunder, under the Notes or under any other
Loan Document, or to prosecute
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or defend any suit in respect of this Agreement, the Notes or any other Loan
Document, unless it is indemnified hereunder to its satisfaction. If any
indemnity in favor of the Administrative Agent shall be or become, in the
Administrative Agent's determination, inadequate, the Administrative Agent
may call for additional indemnification from the Lenders and cease to do the
acts indemnified against hereunder until such additional indemnity is given.
SECTION 9.2 FUNDING RELIANCE, ETC. Unless the Administrative
Agent shall have been notified by telephone, confirmed in writing, by any
Lender by 10:30 p.m., Central time, on the day of a Borrowing that such
Lender will not make available the amount which would constitute its
Percentage of such Borrowing on the date specified therefor, the
Administrative Agent may assume that such Lender has made such amount
available to the Administrative Agent and, in reliance upon such assumption,
make available to the Borrower a corresponding amount. If and to the extent
that such Lender shall not have made such amount available to the
Administrative Agent, such Lender and the Borrower severally agree to repay
the Administrative Agent forthwith on demand such corresponding amount
together with interest thereon, for each day from the date the Administrative
Agent made such amount available to the Borrower to the date such amount is
repaid to the Administrative Agent, at the Federal Funds Rate applicable at
the time.
SECTION 9.3 EXCULPATION. Neither the Administrative Agent nor any
of its directors, officers, employees or agents shall be liable to any Lender
for any action taken or omitted to be taken by it under this Agreement or any
other Loan Document, or in connection herewith or therewith, except for its
own wilful misconduct or gross negligence, nor responsible for any recitals
or warranties herein or therein, nor for the effectiveness, enforceability,
validity or due execution of this Agreement or any other Loan Document, nor
for the creation, perfection or priority of any Liens purported to be created
by any of the Loan Documents, or the validity, genuineness, enforceability,
existence, value or sufficiency of any collateral security, nor to make any
inquiry respecting the performance by the Borrower of its obligations
hereunder or under any other Loan Document. Any such inquiry which may be
made by the Administrative Agent shall not obligate it to make any further
inquiry or to take any action. The Administrative Agent shall be entitled to
rely upon advice of counsel concerning legal matters and upon any notice,
consent, certificate, statement or writing which the Administrative Agent
believes to be genuine and to have been presented by a proper Person.
SECTION 9.4 SUCCESSOR. The Administrative Agent may resign as
such at any time upon at least 30 days' prior notice to the Borrower and all
Lenders. If the Administrative Agent at any time shall resign, the Required
Lenders may appoint another Lender as a successor Administrative Agent which
shall thereupon become the Administrative Agent hereunder. If no successor
Administrative Agent shall have been so appointed by the Required Lenders,
and shall have accepted such appointment, within 30 days after the retiring
Administrative Agent's giving notice of resignation, then the retiring
Administrative Agent may, on behalf of the Lenders,
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appoint a successor Administrative Agent, which shall be one of the Lenders
or a commercial banking institution organized under the laws of the U.S. (or
any State thereof) or a U.S. branch or agency of a commercial banking
institution, and having a combined capital and surplus of at least
$500,000,000. Upon the acceptance of any appointment as Administrative Agent
hereunder by a successor Administrative Agent, such successor Administrative
Agent shall be entitled to receive from the retiring Administrative Agent
such documents of transfer and assignment as such successor Administrative
Agent may reasonably request, and shall thereupon succeed to and become
vested with all rights, powers, privileges and duties of the retiring
Administrative Agent, and the retiring Administrative Agent shall be
discharged from its duties and obligations under this Agreement. After any
retiring Administrative Agent's resignation hereunder as the Administrative
Agent, the provisions of (a) this ARTICLE 9 shall inure to its benefit as to
any actions taken or omitted to be taken by it while it was the
Administrative Agent under this Agreement; and (b) SECTION 10.3 and SECTION
10.4 shall continue to inure to its benefit.
SECTION 9.5 LOANS BY BOFA. BofA shall have the same rights and
powers with respect to (x) the Loans made by it or any of its Affiliates, and
(y) the Notes held by it or any of its Affiliates as any other Lender and may
exercise the same as if it were not the Administrative Agent. BofA and its
Affiliates may accept deposits from, lend money to, and generally engage in
any kind of business with the Borrower or any Subsidiary or Affiliate of the
Borrower as if BofA were not the Administrative Agent hereunder.
SECTION 9.6 CREDIT DECISIONS. Each Lender acknowledges that it
has, independently of the Administrative Agent and each other Lender, and
based on such Lender's review of the financial information of the Borrower,
this Agreement, the other Loan Documents (the terms and provisions of which
being satisfactory to such Lender) and such other documents, information and
investigations as such Lender has deemed appropriate, made its own credit
decision to extend its Commitments. Each Lender also acknowledges that it
will, independently of the Administrative Agent and each other Lender, and
based on such other documents, information and investigations as it shall
deem appropriate at any time, continue to make its own credit decisions as to
exercising or not exercising from time to time any rights and privileges
available to it under this Agreement or any other Loan Document.
SECTION 9.7 COPIES, ETC. The Administrative Agent shall give
prompt notice to each Lender of each notice or request required or permitted
to be given to the Administrative Agent by the Borrower pursuant to the terms
of this Agreement (unless concurrently delivered to the Lenders by the
Borrower). The Administrative Agent will distribute to each Lender each
document or instrument received for its account and copies of all other
communications received by the Administrative Agent from the Borrower for
distribution to the Lenders by the Administrative Agent in accordance with
the terms of this Agreement.
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SECTION 9.8 SYNDICATION AGENT. The Syndication Agent shall not
have any right, power, obligations, liability, responsibility or duty under
this Agreement other than those applicable to Lenders, PROVIDED, HOWEVER,
that the term "Agent" when used in Section 10.4 shall include the Syndication
Agent and the Administrative Agent.
ARTICLE 10
MISCELLANEOUS PROVISIONS
SECTION 10.1 WAIVERS, AMENDMENTS, ETC. The provisions of this
Agreement and of each other Loan Document may from time to time be amended,
modified or waived, if such amendment, modification or waiver is in writing
and consented to by the Borrower and the Required Lenders; PROVIDED, HOWEVER,
that no such amendment, modification or waiver which would: (a) modify any
requirement hereunder that any particular action be taken by all the Lenders
or by the Required Lenders shall be effective unless consented to by each
Lender; (b) modify this SECTION 10.1, change the definition of "REQUIRED
LENDERS," increase any Commitment Amount or the Percentage of any Lender,
reduce any fees described in ARTICLE 3, change the schedule of reductions to
the Commitments provided for in SECTION 2.2.2, release any collateral
security, except as otherwise specifically provided in any Loan Document or
extend any Commitment Termination Date shall be made without the consent of
each Lender and each holder of a Note; (c) extend the due date for, or reduce
the amount of, any scheduled repayment or prepayment of principal of or
interest on any Loan (or reduce the principal amount of or rate of interest
on any Loan) shall be made without the consent of the holder of that Note
evidencing such Loan; or (d) affect adversely the interests, rights or
obligations of the Administrative Agent QUA the Administrative Agent shall be
made without consent of the Administrative Agent. No failure or delay on the
part of the Administrative Agent, any Lender or the holder of any Note in
exercising any power or right under this Agreement or any other Loan Document
shall operate as a waiver thereof, nor shall any single or partial exercise
of any such power or right preclude any other or further exercise thereof or
the exercise of any other power or right. No notice to or demand on the
Borrower in any case shall entitle it to any notice or demand in similar or
other circumstances. No waiver or approval by the Administrative Agent, any
Lender or the holder of any Note under this Agreement or any other Loan
Document shall, except as may be otherwise stated in such waiver or approval,
be applicable to subsequent transactions. No waiver or approval hereunder
shall require any similar or dissimilar waiver or approval thereafter to be
granted hereunder.
SECTION 10.2 NOTICES. All notices and other communications provided
to any party hereto under this Agreement or any other Loan Document shall be in
writing or by facsimile and addressed, delivered or transmitted to such party at
its address, Telex or facsimile number set forth below its signature hereto or
set forth in the Lender Assignment Agreement, or at such other address or
facsimile number as may be designated by such party in a notice to the other
parties. Any notice, if mailed and properly addressed with postage prepaid or
if properly
68
addressed and sent by pre-paid courier service, shall be deemed given when
received; any notice, if transmitted by facsimile, shall be deemed given when
transmitted.
SECTION 10.3 PAYMENT OF COSTS AND EXPENSES. The Borrower agrees to
pay within 10 days of demand all reasonable expenses of the Administrative
Agent (including the fees and out-of-pocket expenses of counsel to the
Administrative Agent and of local counsel, if any, who may be retained by
counsel to the Administrative Agent) in connection with the negotiation,
preparation, execution and delivery of this Agreement and of each other Loan
Document, including schedules and exhibits, and any amendments, waivers,
consents, supplements or other modifications to this Agreement or any other
Loan Document as may from time to time hereafter be required, whether or not
the transactions contemplated hereby are consummated, the filing, recording,
refiling or rerecording of any mortgage, any pledge agreement and any
Security Agreement and/or any Uniform Commercial Code financing statements
relating thereto and all amendments, supplements and modifications to any
thereof and any and all other documents or instruments of further assurance
required to be filed or recorded or refiled or rerecorded by the terms hereof
or of any mortgage, any pledge agreement or any security agreement, and the
preparation and review of the form of any document or instrument relevant to
this Agreement or any other Loan Document.
The Borrower further agrees to pay, and to save the Administrative
Agent and the Lenders harmless from all liability for, any stamp or other
similar taxes which may be payable in connection with the execution or
delivery of this Agreement, the borrowings hereunder, or the issuance of the
Notes or any other Loan Documents. The Borrower also agrees to reimburse the
Administrative Agent and each Lender upon demand for all reasonable
out-of-pocket expenses (including attorneys' fees and legal expenses)
incurred by the Administrative Agent or such Lender in connection with the
enforcement of any Obligations.
SECTION 10.4 INDEMNIFICATION. In consideration of the execution
and delivery of this Agreement by each Lender and the extension of the
Commitments, the Borrower hereby indemnifies, exonerates and holds the
Administrative Agent and any of its Affiliates and each Lender and each of
their respective officers, directors, employees and agents (collectively, the
"INDEMNIFIED PARTIES") free and harmless from and against any and all
actions, causes of action, suits, losses, costs, liabilities and damages, and
expenses incurred in connection therewith (irrespective of whether any such
Indemnified Party is a party to the action for which indemnification
hereunder is sought), including reasonable attorneys' fees and disbursements
and settlement costs (collectively, the "INDEMNIFIED LIABILITIES"), incurred
by the Indemnified Parties or any of them as a result of, or arising out of,
or relating to (a) any transaction financed or to be financed in whole or in
part, directly or indirectly, with the proceeds of any Loan; (b) the
entering into and performance of this Agreement and any other Loan Document
by any of the Indemnified Parties; (c) any investigation, litigation or
proceeding related to any acquisition or proposed acquisition by the Borrower
or any of its Subsidiaries of all or any portion of the stock
69
or assets of any Person, whether or not the Administrative Agent or such
Lender is party thereto; (d) any investigation, litigation or proceeding
related to any environmental cleanup, audit, compliance or other matter
relating to the protection of the environment or the Release by the Borrower
or any of its Subsidiaries of any Hazardous Material; or (e) the presence on
or under, or the escape, seepage, leakage, spillage, discharge, emission,
discharging or releases from, any real property owned or operated by the
Borrower or any Subsidiary thereof of any Hazardous Material (including any
losses, liabilities, damages, injuries, costs, expenses or claims asserted or
arising under any Environmental Law), regardless of whether caused by, or
within the control of, the Borrower or such Subsidiary, except for any such
Indemnified Liabilities arising for the account of a particular Indemnified
Party by reason of the relevant Indemnified Party's gross negligence or
wilful misconduct.
SECTION 10.5 SURVIVAL. The obligations of the Borrower under
SECTIONS 4.3, 4.4, 4.5, 4.6, 10.3 and 10.4, and the obligations of the
Lenders under SECTION 9.1, shall in each case survive any termination of this
Agreement, the payment in full of all Obligations and the termination of all
Commitments. The representations and warranties made by each Obligor in this
Agreement and in each other Loan Document shall survive the execution and
delivery of this Agreement and each such other Loan Document.
SECTION 10.6 SEVERABILITY. Any provision of this Agreement or any
other Loan Document which is prohibited or unenforceable in any jurisdiction
shall, as to such provision and such jurisdiction, be ineffective to the
extent of such prohibition or unenforceability without invalidating the
remaining provisions of this Agreement or such Loan Document or affecting the
validity or enforceability of such provision in any other jurisdiction.
SECTION 10.7 HEADINGS. The various headings of this Agreement and
of each other Loan Document are inserted for convenience only and shall not
affect the meaning or interpretation of this Agreement or such other Loan
Document or any provisions hereof or thereof.
SECTION 10.8 EXECUTION IN COUNTERPARTS, EFFECTIVENESS, ETC. This
Agreement may be executed by the parties hereto in several counterparts, each
of which shall be executed by the Borrower and the Administrative Agent and
be deemed to be an original and all of which shall constitute together but
one and the same agreement. This Agreement shall become effective when
counterparts hereof executed on behalf of the Borrower and each Lender (or
notice thereof satisfactory to the Administrative Agent) shall have been
received by the Administrative Agent and notice thereof shall have been given
by the Administrative Agent to the Borrower and each Lender.
SECTION 10.9 GOVERNING LAW; ENTIRE AGREEMENT. THIS AGREEMENT, THE
NOTES AND EACH OTHER LOAN DOCUMENT SHALL EACH BE DEEMED
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TO BE A CONTRACT MADE UNDER AND GOVERNED BY THE INTERNAL LAWS OF THE STATE OF
NEW YORK. This Agreement, the Notes and the other Loan Documents constitute
the entire understanding among the parties hereto with respect to the subject
matter hereof and supersede any prior agreements, written or oral, with
respect thereto.
SECTION 10.10 SUCCESSORS AND ASSIGNS. This Agreement shall be
binding upon and shall inure to the benefit of the parties hereto and their
respective successors and assigns; PROVIDED, HOWEVER, that: the Borrower may
not assign or transfer its rights or obligations hereunder without the prior
written consent of the Administrative Agent and all Lenders; and the rights
of sale, assignment and transfer of the Lenders are subject to SECTION 10.11.
SECTION 10.11 SALE AND TRANSFER OF LOANS AND NOTES; PARTICIPATIONS
IN LOANS AND NOTES. Each Lender may assign, or sell participations in, its
Loans and Commitments to one or more other Persons in accordance with this
SECTION 10.11.
SECTION 10.11.1 ASSIGNMENTS. Any Lender, (a) with the written
consents of the Borrower and the Administrative Agent (which consents shall
not be unreasonably delayed or withheld and which consent, in the case of the
Borrower, shall be deemed to have been given in the absence of a written
notice delivered by the Borrower to the Administrative Agent, on or before
the fifth Business Day after receipt by the Borrower of such Lender's request
for consent, stating, in reasonable detail, the reasons why the Borrower
proposes to withhold such consent) may at any time assign and delegate to one
or more commercial banks or other financial institutions, and (b) with notice
to the Borrower and the Administrative Agent, but without the consent of the
Borrower or the Administrative Agent, may assign and delegate to any of its
Affiliates or to any other Lender (each Person described in either of the
foregoing clauses as being the Person to whom such assignment and delegation
is to be made, being hereinafter referred to as an "ASSIGNEE LENDER"), all or
any fraction of such Lender's total Loans and Commitments (which assignment
and delegation shall be of a constant, and not a varying, percentage of all
the assigning Lender's Loans and Commitments) in a minimum aggregate amount
of $5,000,000; PROVIDED, HOWEVER, that any such Assignee Lender will comply,
if applicable, with the provisions contained in the last sentence of SECTION
4.6 and FURTHER, PROVIDED, HOWEVER, that, the Borrower, each other Obligor
and the Administrative Agent shall be entitled to continue to deal solely and
directly with such Lender in connection with the interests so assigned and
delegated to an Assignee Lender until (c) written notice of such assignment
and delegation, together with payment instructions, addresses and related
information with respect to such Assignee Lender, shall have been given to
the Borrower and the Administrative Agent by such Lender and such Assignee
Lender, (d) such Assignee Lender shall have executed and delivered to the
Borrower and the Administrative Agent a Lender Assignment Agreement, accepted
by the Administrative Agent, and (e) the processing fees described below
shall have been paid. From and after the date that the Administrative Agent
accepts such Lender Assignment Agreement, (x) the Assignee Lender thereunder
shall be deemed automatically to have become a party hereto
71
and to the extent that rights and obligations hereunder have been assigned
and delegated to such Assignee Lender in connection with such Lender
Assignment Agreement, shall have the rights and obligations of a Lender
hereunder and under the other Loan Documents, and (y) the assignor Lender, to
the extent that rights and obligations hereunder have been assigned and
delegated by it in connection with such Lender Assignment Agreement, shall be
released from its obligations hereunder and under the other Loan Documents.
Within five (5) Business Days after its receipt of notice that the
Administrative Agent has received an executed Lender Assignment Agreement,
the Borrower shall execute and deliver to the Administrative Agent (for
delivery to the relevant Assignee Lender) new Notes evidencing such Assignee
Lender's assigned Loans and Commitments and, if the assignor Lender has
retained Loans and Commitments hereunder, replacement Notes in the principal
amount of the Loans and Commitments retained by the assignor Lender hereunder
(such Notes to be in exchange for, but not in payment of, those Notes then
held by such assignor Lender). Each such Note shall be dated the date of the
predecessor Notes. The assignor Lender shall xxxx the predecessor Notes
"exchanged" and deliver them to the Borrower. Accrued interest on that part
of the predecessor Notes evidenced by the new Notes, if any, shall be paid as
provided in the Lender Assignment Agreement. Accrued interest on that part
of the predecessor Notes evidenced by the replacement Notes shall be paid to
the assignor Lender. Accrued interest and accrued fees shall be paid at the
same time or times provided in the predecessor Notes and in this Agreement.
Such assignor Lender or such Assignee Lender must also pay a processing fee
to the Administrative Agent upon delivery of any Lender Assignment Agreement
in the amount of $3,500. Any attempted assignment and delegation not made in
accordance with this SECTION 10.11.1 shall be null and void.
SECTION 10.11.2 PARTICIPATIONS. Any Lender may at any time sell to
one or more commercial banks or other Persons (each of such commercial banks
and other Persons being herein called a "PARTICIPANT") participating
interests in any of the Loans, Commitments, or other interests of such Lender
hereunder; PROVIDED, HOWEVER, that (a) no participation contemplated in this
SECTION 10.11 shall relieve such Lender from its Commitments or its other
obligations hereunder or under any other Loan Document, (b) such Lender shall
remain solely responsible for the performance of its Commitments and such
other obligations, (c) the Borrower and the Administrative Agent shall
continue to deal solely and directly with such Lender in connection with such
Lender's rights and obligations under this Agreement and each of the other
Loan Documents, (d) no Participant, unless such Participant is an Affiliate
of such Lender, or is itself a Lender, shall be entitled to require such
Lender to take or refrain from taking any action hereunder or under any other
Loan Document, except that such Lender may agree with any Participant that
such Lender will not, without such Participant's consent, take any actions of
the type described in CLAUSE (b) or (c) of SECTION 10.1, and (e) the Borrower
shall not be required to pay any amount under SECTION 4.6 that is greater
than the amount which it would have been required to pay had no participating
interest been sold. Subject to the above, the Borrower acknowledges and
agrees that each Participant, for purposes of SECTIONS 4.3, 4.4, 4.5, 4.6,
4.8, 10.3 and 10.4, shall be considered a Lender.
72
SECTION 10.12 OTHER TRANSACTIONS. Nothing contained herein shall
preclude the Administrative Agent or any other Lender from engaging in any
transaction, in addition to those contemplated by this Agreement or any other
Loan Document, with the Borrower or any of its Affiliates in which the
Borrower or such Affiliate is not restricted hereby.
SECTION 10.13 FORUM SELECTION AND CONSENT TO JURISDICTION. ANY
LITIGATION BASED HEREON, OR ARISING OUT OF, UNDER, OR IN CONNECTION WITH,
THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT, OR ANY COURSE OF CONDUCT, COURSE
OF DEALING, STATEMENTS (WHETHER VERBAL OR WRITTEN) OR ACTIONS OF THE
ADMINISTRATIVE AGENT, THE LENDERS OR THE BORROWER MAY BE BROUGHT AND
MAINTAINED IN THE COURTS OF THE STATE OF NEW YORK OR IN THE UNITED STATES
DISTRICT COURT FOR THE SOUTHERN DISTRICT OF NEW YORK. THE BORROWER HEREBY
EXPRESSLY AND IRREVOCABLY SUBMITS TO THE JURISDICTION OF THE COURTS OF THE
STATE OF NEW YORK AND OF THE UNITED STATES DISTRICT COURT FOR THE SOUTHERN
DISTRICT OF NEW YORK FOR THE PURPOSE OF ANY SUCH LITIGATION AS SET FORTH
ABOVE AND IRREVOCABLY AGREES TO BE BOUND BY ANY JUDGMENT RENDERED THEREBY IN
CONNECTION WITH SUCH LITIGATION. THE BORROWER FURTHER IRREVOCABLY CONSENTS
TO THE SERVICE OF PROCESS BY PERSONAL SERVICE WITHIN OR WITHOUT THE STATE OF
NEW YORK. THE BORROWER HEREBY EXPRESSLY AND IRREVOCABLY WAIVES, TO THE
FULLEST EXTENT PERMITTED BY LAW, ANY OBJECTION WHICH IT MAY HAVE OR HEREAFTER
MAY HAVE TO THE LAYING OF VENUE OF ANY SUCH LITIGATION BROUGHT IN ANY SUCH
COURT REFERRED TO ABOVE AND ANY CLAIM THAT ANY SUCH LITIGATION HAS BEEN
BROUGHT IN AN INCONVENIENT FORUM.
SECTION 10.14 WAIVER OF JURY TRIAL. THE ADMINISTRATIVE AGENT, THE
LENDERS AND THE BORROWER HEREBY KNOWINGLY, VOLUNTARILY AND INTENTIONALLY
WAIVE ANY RIGHTS THEY MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY
LITIGATION BASED HEREON, OR ARISING OUT OF, UNDER, OR IN CONNECTION WITH,
THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT, OR ANY COURSE OF CONDUCT, COURSE
OF DEALING, STATEMENTS (WHETHER VERBAL OR WRITTEN) OR ACTIONS OF THE
ADMINISTRATIVE AGENT, THE LENDERS OR THE BORROWER. THE BORROWER ACKNOWLEDGES
AND AGREES THAT IT HAS RECEIVED FULL AND SUFFICIENT CONSIDERATION FOR THIS
PROVISION (AND EACH OTHER PROVISION OF EACH OTHER LOAN DOCUMENT TO WHICH IT
IS A PARTY) AND THAT THIS PROVISION IS A MATERIAL INDUCEMENT FOR THE
73
ADMINISTRATIVE AGENT AND THE LENDERS ENTERING INTO THIS AGREEMENT AND EACH
SUCH OTHER LOAN DOCUMENT.
SECTION 10.15 CONFIDENTIALITY. Each Lender and the Administrative
Agent agrees to use reasonable commercial efforts not to disclose without the
prior written consent of the Borrower (other than to their employees,
auditors or counsel or to another Lender if the Lender or such Lender's
holding or parent company or the Administrative Agent in its sole discretion
determines that any such party should have access to such information) any
confidential information with respect to the Borrower or any Subsidiary which
is furnished pursuant to this Agreement, PROVIDED, that any Lender and the
Administrative Agent may disclose any such information (a) as has become
generally available to the public, (b) as may be required or appropriate in
any report, statement or testimony submitted to any municipal, provincial,
state or Federal regulatory body having or claiming to have jurisdiction over
such Lender or the Administrative Agent or to the Federal Reserve Board, Bank
of Canada, the Office of the Superintendent of Financial Institutions, Canada
Deposit Insurance Corporation, the Federal Deposit Insurance Corporation,
National Association of Insurance Commissioners or similar organizations
(whether in the United States or elsewhere) or their successors, (c) as may
be required or appropriate in response to any summons or subpoena or in
connection with any litigation, (d) in order to comply with any law, order,
regulation or ruling applicable to such Lender or the Administrative Agent,
and (e) to any Affiliate of such Lender or Administrative Agent.
A Lender may furnish any publicly available information concerning the
Borrower or any of its Subsidiaries in the possession of such Lender from
time to time to assignees and participants (including prospective assignees
and participants) without the consent of the Borrower. Nonpublic information
concerning the Borrower or any of its Subsidiaries shall not be furnished by
any Lender to assignees and participants (including prospective assignees and
participants) without the prior written consent of the Borrower, which
consent shall not be unreasonably withheld or delayed.
SECTION 10.16 RELEASES. If all outstanding Loans and other
Obligations have been indefeasibly paid in full and no Letters of Credit are
outstanding and the Commitment Amounts have terminated or have been reduced
to zero pursuant to SECTION 2.2, the Administrative Agent agrees to, and the
Lenders hereby instruct the Administrative Agent to, at the Borrower's
expense, execute such releases of the Collateral Documents as the Borrower
shall reasonably request and this Agreement shall be deemed terminated except
that such termination shall not relieve Borrower of any obligation to make
any payments to the Administrative Agent or any Lender required by any Loan
Document to the extent accruing, or relating to an event occurring, prior to
such termination.
74
SECTION 10.17 PRIORITY OF HEDGING OBLIGATIONS. Borrower, Lenders
and Administrative Agent hereby agree that (i) any amounts received in
satisfaction of any Obligations arising under the Loan Documents, including,
without limitation, Obligations under this Agreement and any Lender Hedging
Agreement, shall rank PARI PASSU in right of payment and shall be used to
repay such Obligations on a pro rata basis, and (ii) except as otherwise set
forth in SECTION 10.17(i) above, all Hedging Obligations arising in
connection with any Hedging Agreement are hereby expressly subordinated in
right of payment to the prior payment in full in cash of all Obligations
under the Loan Documents, other than any Lender Hedging Agreement.
[SIGNATURES BEGIN ON FOLLOWING PAGE]
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be executed by their respective officers thereunto duly authorized as of the
day and year first above written.
MARKWEST HYDROCARBON, INC.
By:
--------------------------------
Name: Xxxxxx X. Xxxxxxxx
Title: Vice President, Finance
Address: 000 Xxxxxxxxx Xxxxx Xxxx
Xxxxx 000
Xxxxxxxxx, Xxxxxxxx 00000
Telephone No: (000) 000-0000
Facsimile No.: (000) 000-0000
Attention: Chief Financial Officer
S-1
BANK OF AMERICA, N.A., as Administrative
Agent and Syndication Agent
By:
--------------------------------
Name: Xxxxxx X. Xxxxxxx
Title: Senior Vice President
Address: 000 Xxxx Xxxxxx, 00xx Xxxxx
Xxxxxx, Xxxxx 00000
Telephone No.: (000) 000-0000
Facsimile No: (000) 000-0000
Attention: Xx. Xxxxxx Xxxxxxxx
with a copy to:
000 Xxxx Xxxxxx, Xxxxx 00
Xxxxxx, Xxxxx 00000
Telephone No.: (000) 000-0000
Facsimile No: (000) 000-0000
Attention: Xx. Xxxxxx X. Xxxxxxx
X-0
PERCENTAGE LENDERS
50.0% BANK OF AMERICA, N.A.
By:
--------------------------------
Name: Xxxxxx X. Xxxxxxx
Title: Senior Vice President
Domestic
Office: 000 Xxxx Xxxxxx, 00xx Xxxxx
Xxxxxx, Xxxxx 00000
Telephone No.: (000) 000-0000
Facsimile No: (000) 000-0000
Attention: Xx. Xxxxxx Xxxxxxxx
LIBOR
Office: 000 Xxxx Xxxxxx, 00xx Xxxxx
Xxxxxx, Xxxxx 00000
Telephone No.: (000) 000-0000
Facsimile No: (000) 000-0000
Attention: Xx. Xxxxxx Xxxxxxxx
with a copy to:
000 Xxxx Xxxxxx, Xxxxx 00
Xxxxxx, Xxxxx 00000
Telephone No.: (000) 000-0000
Facsimile No: (000) 000-0000
Attention: Xx. Xxxxxx X. Xxxxxxx
X-0
50.0% U.S. BANK, NATIONAL ASSOCIATION
By:
--------------------------------
Name:
Title:
Domestic
Office: 000 00xx Xxxxxx, XXXX 0000
Xxxxxx, Xxxxxxxx 00000
Telephone No.: (000) 000-0000
Facsimile No.: (000) 000-0000
Attention: Xx. Xxxxx Xxxxxxx
LIBOR
Office: 000 00xx Xxxxxx, XXXX 0000
Xxxxxx, Xxxxxxxx 00000
Telephone No.: (000) 000-0000
Facsimile No.: (000) 000-0000
Attention: Xx. Xxxxx Xxxxxxx
____
100%
====
S-4
