CREDIT AGREEMENT
dated as of January 31, 2006
between
TORTOISE NORTH AMERICAN ENERGY CORPORATION
and
U.S. BANK NATIONAL ASSOCIATION
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$40,000,000 Revolving Credit Facility
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CREDIT AGREEMENT
This Credit Agreement is made as of January 31, 2006, by and between
TORTOISE NORTH AMERICAN ENERGY CORPORATION, a Maryland corporation (the
"Borrower"), with its chief executive office located at ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇,
▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇, and U.S. BANK NATIONAL ASSOCIATION, a national
banking association (the "Bank"),with an office located at ▇▇▇▇ ▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇.
The parties agree as follows:
Section 1
General Definitions
1.1 Definitions. When used in this Agreement, the following terms
have the following meanings:
"Affiliate" means a Person (1) which owns or otherwise has an interest
in five percent or more of any equity interest of the Borrower, (2) five percent
or more of the equity interests of which the Borrower (or any shareholder or
other equity holder, director, officer, employee or subsidiary of the Borrower
or any combination thereof) owns or otherwise has an interest in, or (3) which,
directly or through one or more intermediaries, is controlled by, controls, or
is under common control with the Borrower. For purposes of subpart (3) above,
"control" means the ability, directly or indirectly, to affect the management or
policies of a Person by virtue of an ownership interest, by right of contract or
any other means.
"Agreement" means this Credit Agreement, as amended, renewed, restated,
replaced or otherwise modified from time to time.
"Business Day" means a day on which the Bank is open for business to
the general public other than a Saturday or Sunday.
"Closing Date" means the date of this Agreement, as set forth in the
introductory paragraph of this Agreement.
"Collateral" means all property with respect to which a Lien has been
granted to or for the benefit of the Bank pursuant to the Security Agreement or
any of the other Credit Documents or which otherwise secures the payment or
performance of any Obligation.
"Common Listed Equity Units" means any of the following financial
assets held in the Securities Account: (1) securities traded on a national
securities exchange in the United States or the Toronto Stock Exchange, (2) cash
and cash equivalents that have a readily obtainable market value, (3) bonds
rated Baa or better by the applicable national rating agency, and (4) such other
assets as may be acceptable to the Bank in the exercise of its sole and absolute
discretion.
"Common Listed Equity Units Value" means, at any date, the value of all
Common Listed Equity Units as customarily determined by the Securities
Intermediary and as reflected in the account statement for the Securities
Account (or as would be reflected if an account statement for the Securities
Account were to be issued by the Securities Intermediary as of such date);
provided, however, that, with respect to Common Listed Equity Units of the type
described in subpart (4) of the definition thereof, the value of such assets
shall be the value assigned to such assets by the Bank, in the exercise of its
sole and absolute discretion, and without regard to the value of such assets as
reflected in an account statement for the Securities Account.
"Control Agreement" means the Securities Account Control Agreement or
similar control agreement to be executed by the Borrower, the Securities
Intermediary and the Bank on or about the Closing Date and by which the
Securities Intermediary shall acknowledge that it will comply with entitlement
orders originated by the Bank without further consent by the Borrower, as the
same may be amended, renewed, replaced, restated, consolidated or otherwise
modified from time to time.
"Credit Documents" means this Agreement, the Note, the Security
Agreement, the Control Agreement and any other agreements or documents with or
in favor of the Bank existing on or after the Closing Date evidencing, securing,
guaranteeing or otherwise relating to any of the transactions described in or
contemplated by this Agreement, and any amendments, renewals, restatements,
replacements, consolidations or other modifications of any of the foregoing from
time to time.
"Debt" means any of the following: (1) indebtedness or liability for
borrowed money; (2) obligations evidenced by bonds, debentures, notes or other
similar instruments; (3) obligations for the deferred purchase price of property
or services, or arising out of non-compete or non-solicitation agreements
entered into in connection with asset or equity acquisitions; (4) obligations as
lessee under capital leases; (5) current liabilities in respect of unfunded
vested benefits under Plans covered by ERISA; (6) obligations under letters of
credit or acceptance facilities; (7) all guarantees, endorsements (other than
for collection or deposit in the ordinary course of business) and other
contingent obligations to purchase, to provide funds for payment, to supply
funds to invest in any Person, or otherwise to assure a creditor against loss;
and (8) obligations secured by a Lien, whether or not the obligations have been
assumed.
"Default" means an event or condition the occurrence of which would,
with the lapse of time or the giving of notice or both, become an Event of
Default.
"Default Rate" has the meaning provided in Section 3.1 of this
Agreement.
"Environmental Laws" means all federal, state, local and other
applicable statutes, ordinances, rules, regulations, judicial orders or decrees,
common law theories of liability, governmental or quasi-governmental directives
or notices or other laws or matters existing on or after the Closing Date
relating in any respect to occupational safety, health or environmental
protection.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended from time to time, and all rules and regulations from time to time
promulgated thereunder.
"Event of Default" has the meaning provided in Section 7.1 of this
Agreement.
"GAAP" means generally accepted accounting principles in effect from
time to time in the United States of America.
"Hazardous Substance" means any hazardous, toxic, dangerous or
otherwise environmentally unsound substance, waste or other material, in
whatever form, as defined or described in, or contemplated by, any Environmental
Law and any other hazardous, toxic, dangerous or otherwise environmentally
unsound substance, waste or other material in whatever form, or any other
substance, waste or other material regulated by any Environmental Law.
"Lien" means any mortgage, deed of trust, pledge, security interest,
hypothecation, assignment, deposit arrangement, encumbrance, lien (statutory or
other), or preference, priority, or other security agreement or preferential
arrangement, charge or encumbrance of any kind or nature whatsoever, including,
without limitation, any conditional sale or other title retention agreement, any
financing lease having substantially the same economic effect as any of the
foregoing, or the filing of any financing statement under the Uniform Commercial
Code or comparable law of any jurisdiction to evidence any of the foregoing.
"Loans" means all Revolving Credit Loans. The term "Loan" may refer to
all Revolving Credit Loans then outstanding or, as the context so requires, any
particular Revolving Credit Loan then outstanding under this Agreement.
"Material Adverse Effect" means (1) a material adverse effect on the
assets, liabilities, business, prospects, operations, income or condition,
financial or otherwise, of the Borrower, (2) a material impairment of the
ability of the Borrower to pay, perform or observe its obligations under the
Credit Documents, or (3) a material impairment of the enforceability or
availability of the rights or remedies stated to be available to the Bank under
the Credit Documents.
"Note" means the Revolving Credit Note.
"Obligations" means all Loans and all other advances, debts,
liabilities, obligations, covenants and duties owing, arising, due or payable
from the Borrower to the Bank of any kind or nature, existing or future, whether
or not evidenced by any note, letter of credit, guaranty or other instrument,
whether arising under this Agreement or any of the other Credit Documents or
otherwise and whether direct or indirect (including, without limitation, those
acquired by assignment), absolute or contingent, primary or secondary, due or to
become due, existing on or after the Closing Date and however acquired, and all
amendments, renewals, restatements, replacements or other modifications of the
foregoing from time to time. The term includes, without limitation, all
principal, interest, fees, expenses and any other sums chargeable to the
Borrower under any of the Credit Documents.
"Permitted Debt" means any of the following: (1) accrued expenses and
trade account payables incurred in the ordinary course of the Borrower's
business; (2) Debt to the Bank; (3) Debt which is subordinated to the
Obligations pursuant to the terms of a subordination agreement satisfactory in
form and content to the Bank in its sole discretion; and (4) other Debt approved
in advance by the Bank in a writing delivered to the Borrower.
"Permitted Liens" means any of the following: (1) Liens for taxes,
assessments or governmental charges not delinquent or being contested in good
faith and by appropriate proceedings and for which adequate reserves in
accordance with GAAP are maintained on the Borrower's books; (2) Liens arising
out of deposits in connection with workers' compensation, unemployment
insurance, old age pensions or other social security or retirement benefits
legislation; (3) deposits or pledges to secure bids, tenders, contracts (other
than contracts for the payment of money), leases, statutory obligations, surety
and appeal bonds, and other obligations of like nature arising in the ordinary
course of the Borrower's business; (4) Liens imposed by law, such as mechanics',
workers', materialmen's, carriers' or other like Liens (excluding, however, any
Lien in favor of a landlord) arising in the ordinary course of the Borrower's
business which secure the payment of obligations which are not past due or which
are being diligently contested in good faith by appropriate proceedings and for
which adequate reserves in accordance with GAAP are maintained on the Borrower's
books; (5) rights of way, zoning restrictions, easements and similar
encumbrances affecting the Borrower's real property which do not materially
interfere with the use of such property; and (6) Liens in favor of the Bank.
"Person" means an individual, corporation, limited liability company,
partnership, trust, governmental entity or any other entity, organization or
group whatsoever.
"Plan" means an employee benefit plan (as defined in Section 3(3) of
ERISA) maintained for employees of the Borrower on or after the Closing Date.
"Revolving Credit Loan" has the meaning provided in Section 2.2 of this
Agreement.
"Revolving Credit Note" has the meaning provided in Section 2.2 of this
Agreement.
"Securities Account" has the meaning provided in the Security
Agreement.
"Securities Account Value" means, at any date, the value of all
financial assets in the Securities Account as customarily determined by the
Securities Intermediary and as reflected in the account statement for the
Securities Account (or as would be reflected if an account statement for the
Securities Account were to be issued by the Securities Intermediary as of such
date).
"Securities Intermediary" means U.S. Bank National Association.
"Security Agreement" means the Security Agreement to be executed by the
Borrower on or about the Closing Date in favor of the Bank and by which the
Borrower shall grant to the Bank, as security for the Obligations, a security
interest in all of the Borrower's presently owned or hereafter acquired
investment assets, including without limitation, all of the Borrower's
investment property, and all instruments, accounts and general intangibles, as
the same may be amended, renewed, replaced, restated, consolidated or otherwise
modified from time to time.
"Termination Date" means April 15, 2006.
"UCC" means the Uniform Commercial Code as in effect in the State of
Kansas from time to time.
1.2 Accounting and Other Terms.
(a) General. All accounting terms not specifically defined herein
shall be construed in accordance with GAAP. Unless the context clearly requires
otherwise, all references to "dollars" or "$" are to United States dollars. This
Agreement and the other Credit Documents shall be construed without regard to
any presumption or rule requiring construction against the party causing any
such document or any portion thereof to be drafted. The Section and other
headings in this Agreement and any index at the beginning of this Agreement are
for convenience of reference only and shall not limit or otherwise affect any of
the terms of this Agreement. Similarly, any page footers or headers or similar
word processing, document or page identification numbers in this Agreement or
any index or exhibit are for convenience of reference only and shall not limit
or otherwise affect any of the terms of this Agreement, nor shall there be any
requirement that any such footers or other numbers be consistent from page to
page. Unless the context clearly requires otherwise, any reference to a Section
of this Agreement refers to all Sections and Subsections thereunder. Any pronoun
used herein shall be deemed to cover all genders. Defined terms used in this
Agreement may be set forth in Section 1.1 or other Sections of this Agreement,
and all such definitions defined in the singular shall have a corresponding
meaning when used in the plural and vice versa.
(b) Changes in GAAP. If at any time any change in GAAP would
affect the computation of any financial ratio or requirement set forth in any
Credit Document, and either the Borrower or the Bank shall so request, the Bank
and the Borrower shall negotiate in good faith to amend such ratio or
requirement to preserve the original intent thereof in light of such change in
GAAP; provided, however, that, until so amended, (1) such ratio or requirement
shall continue to be computed in accordance with GAAP prior to such change
therein, and (2) the Borrower shall provide to the Bank financial statements and
other documents required under this Agreement or as reasonably requested
hereunder setting forth a reconciliation between calculations of such ratio or
requirement made before and after giving effect to such change in GAAP.
Section 2
Credit Facility
2.1 Total Credit Facility. The Bank agrees, subject to the terms and
conditions of this Agreement, to make a total credit facility of up to
$40,000,000 available to the Borrower upon its request therefor, as provided in
this Section 2.
2.2 Revolving Credit Loans.
(a) General. The Bank agrees, subject to the terms and conditions
of this Agreement, to make revolving credit loans ("Revolving Credit Loans") to
the Borrower from time to time from the Closing Date to the Business Day
immediately preceding the Termination Date up to a maximum principal amount at
any time outstanding equal to $40,000,000. In no event shall the Bank be
obligated to make any Revolving Credit Loan if (1) after giving effect to such
Revolving Credit Loan, the outstanding principal balance of the Obligations
would exceed 50% of the Common Listed Equity Units Value, or (2) any Default or
Event of Default exists or would result from the making of such Revolving Credit
Loan. Subject to the terms and conditions of this Agreement, the Borrower may
borrow, repay and re-borrow under the Revolving Credit Loan facility.
(b) Revolving Credit Note. All Revolving Credit Loans shall be
evidenced by, and shall be payable in accordance with the terms and conditions
of, a promissory note substantially in the form of Exhibit A hereto (as amended,
renewed, restated, replaced, consolidated or otherwise modified from time to
time, the "Revolving Credit Note").
Section 3
Finance Charges, Repayment And Other Terms
3.1 Interest Rate.
(a) General. Interest on each advance hereunder shall accrue at
an annual rate equal to 0.75% plus the one-month LIBOR rate quoted by the Bank
from Telerate Page 3750 or any successor thereto, which shall be that one-month
LIBOR rate in effect two New York Banking Days prior to the beginning of each
calendar month, adjusted for any reserve requirement and any subsequent costs
arising from a change in government regulation, such rate to be reset at the
beginning of each succeeding month. The term "New York Banking Day" means any
day (other than a Saturday or Sunday) on which commercial banks are open for
business in New York, New York. If the initial advance under this Agreement
occurs other than on the first day of the month, the initial one-month LIBOR
rate shall be that one-month LIBOR rate in effect two New York Banking Days
prior to the date of the initial advance, which rate plus the percentage
described above shall be in effect for the remaining days of the month of the
initial advance; such one-month LIBOR rate to be reset at the beginning of each
succeeding month. The Bank's internal records of applicable interest rates shall
be determinative in the absence of manifest error.
(b) Default Rate. Upon or after the occurrence and during the
continuation of any Event of Default, the principal amount of each Loan shall
bear interest at a rate per annum equal to three percent (3.0%) above the
interest rate that would otherwise apply under Section 3.1(a) above (the
"Default Rate").
(c) Late Fee. In addition to interest payable at the Default Rate
or any other amounts payable under this Agreement or the other Credit Documents,
the Borrower shall pay to the Bank a late fee in an amount equal to five percent
(5%) of the amount of each payment due under this Agreement which is not
received by the Bank within five (5) days after its due date.
(d) Computation of Interest. Interest on the outstanding
principal balance of all Loans and all other Obligations with respect to which
interest accrues pursuant to the terms of this Agreement shall be calculated on
a daily basis, computed on the basis of a 360-day year for the actual number of
days elapsed (or, if the Bank so elects, on the basis of twelve 30-day months
for the actual number of days elapsed).
(e) Usury. In no contingency or event whatsoever shall the
aggregate of all amounts deemed interest hereunder or under the Note and charged
or collected pursuant to the terms of this Agreement or any other Credit
Documents exceed the highest rate permissible under any law which a court of
competent jurisdiction shall, in a final determination, deem applicable thereto.
If such a court determines that the Bank has charged or received interest
hereunder or under the other Credit Documents in excess of the highest
applicable rate, the Bank shall apply such excess to any other Obligations then
due and payable, whether principal, interest, fees or otherwise, and shall
refund the remainder of such excess interest, if any, to the Borrower, and such
rate shall automatically be reduced to the maximum rate permitted by such law.
3.2 Payments of Principal, Interest and Costs. Except as otherwise
provided in this Agreement, the Borrower agrees to pay the Obligations as
follows:
(a) Revolving Credit Loan.
(1) Interest. Accrued interest on outstanding principal
balance of the Revolving Credit Loan is payable on the
earlier to occur of (A) the first day of each month
(beginning March 1, 2006), or (B) the Termination Date.
(2) Principal. The outstanding principal balance of the
Revolving Credit Loan is payable on the Termination
Date.
(b) Other Obligations. Costs, fees and expenses and any other
Obligations payable by the Borrower pursuant to this Agreement or the other
Credit Documents shall be payable as and when provided in this Agreement or the
other Credit Documents, as the case may be, or, if no specific provision for
payment is made, on demand.
3.3 Voluntary Prepayments. The Borrower has the right, without penalty
or premium, to prepay the Loan, in whole or in part, at any time and from time
to time after the Closing Date.
3.4 Mandatory Prepayments.
(a) Loan to Value. If, at any time, the outstanding principal
balance of the Loan exceeds 50% of the Common Listed Equity Units Value, the
Borrower shall immediately prepay the Loan in an amount sufficient to reduce the
aggregate unpaid principal balance of the Loan by an amount equal to such
excess.
(b) Legal Requirement. If at any time the Borrower or the Bank,
as the case may be, is required by applicable law to prepay or to cause to be
prepaid all or any portion of the Loan or to pledge or to cause to be pledged
any additional collateral in connection with the Loan, the Borrower shall
immediately prepay the Loan in an amount sufficient to satisfy such legal
requirement. For purposes of the preceding sentence, "applicable law" and "legal
requirement" shall include, without limitation, any legal requirement or
restriction imposed by virtue of Regulation U of the Board of Governors of the
Federal Reserve System or the Investment Company Act of 1940, as amended, or the
rules and regulations promulgated thereunder.
3.5 Method of Payment. Payments due the Bank under this Agreement and
the other Credit Documents shall be made in immediately available funds to the
Bank at its office described in the introductory paragraph of this Agreement
unless the Bank gives notice to the contrary. Payments so received at or before
1:00 p.m. Kansas City time on any Business Day shall be deemed to have been
received by the Bank on that Business Day. Payments received after 1:00 p.m.
Kansas City time on any Business Day shall be deemed to have been received on
the next Business Day, and interest, if payable in respect of such payment,
shall accrue thereon until such next Business Day.
3.6 Use of Proceeds. The Revolving Credit Loans shall be used solely
for purposes of: (1) purchasing additional Collateral in the form of security
entitlements, provided that immediately upon such acquisition the Bank has a
perfected first priority security interest in such additional Collateral as
security for the Obligations, with such security interest being perfected by
"control" within the meaning of UCC ss.8-106(d)(2), pursuant to the Security
Agreement and the Control Agreement; (2) the Borrower's general working capital
and other general corporate needs; and (3) paying costs and expenses incurred in
connection with the closing of the transactions contemplated by this Agreement.
3.7 Notice and Manner of Borrowing. The Borrower shall give the Bank
notice of its intention to borrow under any Revolving Credit Loan at least one
Business Day before the Business Day such Loan is to be disbursed to the
Borrower, and shall specify: (1) the proposed funding date of such Loan; and (2)
the amount of such Loan. All notices given under this Section by the Borrower
shall be irrevocable and shall be given not later than 11:00 a.m. Kansas City
time on the day which is not less than the number of Business Days specified
above for such notice. For purposes of this Section, the Borrower agrees that
the Bank may rely and act upon any request for a Loan from any individual who
the Bank, absent gross negligence or willful misconduct, believes to be a
representative of the Borrower.
3.8 Capital Adequacy. If the Bank determines that the adoption of any
law, rule or regulation regarding capital adequacy, or any change therein or in
the interpretation or application thereof or compliance by the Bank with any
request or directive regarding capital adequacy (whether or not having the force
of law) from any central bank or governmental authority, does or shall have the
effect of reducing the rate of return on the Bank's capital as a consequence of
its obligations hereunder to a level below that which the Bank could have
achieved but for such adoption, change or compliance (taking into consideration
the Bank's policies with respect to capital adequacy) by an amount deemed by the
Bank, in its sole discretion, to be material, then from time to time, after
submission by the Bank to the Borrower of a written demand therefor, the
Borrower shall pay to the Bank such additional amount or amounts as will
compensate the Bank for such reduction. A certificate of the Bank claiming
entitlement to payment as set forth in this Section shall be conclusive in the
absence of manifest error. Such certificate shall set forth the nature of the
occurrence giving rise to such payment, the additional amount or amounts to be
paid to the Bank, and the method by which such amounts were determined. In
determining such amount, the Bank may use any reasonable averaging and
attribution method.
3.9 Application of Payments and Collections. The Borrower irrevocably
waives the right to direct the application of any and all payments and
collections at any time or times after the Closing Date received by the Bank
from or on behalf of the Borrower, and the Borrower agrees that the Bank has the
continuing exclusive right to apply and reapply any and all such payments and
collections received at any time or times after the Closing Date by the Bank or
its agent against the Obligations, in such manner as the Bank may deem
advisable, notwithstanding any entry by the Bank upon any of its books and
records.
3.10 Periodic Statement. The Bank may account to the Borrower with a
periodic statement of loan balances, charges and payments made or received
pursuant to this Agreement, and any such statement rendered by the Bank shall be
deemed final, binding and conclusive upon the Borrower unless the Bank is
notified by the Borrower in writing to the contrary within 45 days after the
date such statement is made available to the Borrower. Any such notice by the
Borrower shall only be deemed an objection to those items specifically objected
to in such notice.
Section 4
Lending Conditions
4.1 Credit Documents. Notwithstanding anything herein or in the other
Credit Documents to the contrary, the Bank shall not be obligated to make the
initial Loan under this Agreement to the Borrower until the Bank has received
the following documents, duly executed and delivered by all parties thereto, and
otherwise satisfactory in form and content to the Bank:
(a) Credit Agreement. This Agreement;
(b) Note. The Revolving Credit Note;
(c) Security Agreement. The Security Agreement;
(d) UCC Financing Statements. Acknowledgment copies of
filed UCC-1 financing statements from the Borrower, as
debtor, to the Bank, as secured party, covering the
Collateral, from such jurisdictions as the Bank deems
necessary or desirable to perfect its security interest
in the Collateral;
(e) Control Agreement. The Control Agreement;
(f) Loan Disbursement Instructions. If requested by the
Bank, written instructions from the Borrower to the
Bank directing the disbursement of the proceeds of the
initial Loan made pursuant to this Agreement;
(g) Form U-1. A Form U-1 for the Borrower whereby, among
other things, the Borrower represents and warrants that
the Loan proceeds may be used to purchase or carry
margin stock, the Borrower hereby concurring with the
assessment of the market value of the Collateral
described therein as of the date provided therein;
(h) Opinion of Borrower's Counsel. The favorable written
opinion to the Bank of ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
LLP, counsel to the Borrower, regarding the Borrower,
the Credit Documents and the transactions contemplated
by this Agreement and the other Credit Documents;
(i) Certificate of Borrower's Secretary. A certificate
executed by the Borrower's secretary whereby such
secretary affirms that, among other things, attached to
such certificate is (1) a copy of the Borrower's board
resolutions authorizing the borrowing of monies, the
granting of Liens and all other matters set forth in or
contemplated by the Credit Documents, (2) a copy of the
Borrower's by-laws in effect on the Closing Date, (3) a
copy of the Borrower's articles or certificate of
incorporation and all amendments thereto, and (4) a
certificate of good standing for the Borrower, dated on
or not more than 10 days prior to the Closing Date,
from the Secretary or State of the state of
incorporation of the Borrower and from the Secretary of
State of Kansas; and
(j) Other Items. Such other agreements, documents and
assurances as the Bank may reasonably request in
connection with the transactions described in or
contemplated by the Credit Documents.
If the Bank, in its sole and absolute discretion, elects to make a Loan
notwithstanding the Borrower's failure to comply with all of the terms of this
Section, then the Bank shall not be deemed to have waived
the Borrower's compliance therewith, nor to have waived any of the Bank's other
rights under this Agreement; and in any event the Bank, if it so elects, may
declare an immediate Event of Default if the Borrower fails to furnish to the
Bank on demand any of the Credit Documents described in this Section or
otherwise fails to comply with any condition precedent set forth in any Credit
Document, in each case irrespective of whether such failure occurs on or after
the Closing Date or the making of such Loan.
4.2 Additional Conditions Precedent to Initial Loan. The Bank's
obligation to make the initial Loan under this Agreement shall also be subject
to the satisfaction, in the Bank's sole judgment, of each of the following
conditions precedent:
(a) Since the date of the financial statements submitted by
the Borrower to the Bank immediately prior to the
Closing Date, there shall not have occurred any act or
event which could reasonably be expected to have a
Material Adverse Effect;
(b) No action, proceeding, investigation, regulation or
legislation shall have been instituted, threatened or
proposed before any court, governmental agency or
legislative body to enjoin, restrain or prohibit, or to
obtain damages in respect of, or which is related to or
arises out of this Agreement or the other Credit
Documents or the consummation of the transactions
contemplated hereby or thereby or which, in the Bank's
reasonable determination, would make it inadvisable to
consummate the transactions contemplated by this
Agreement or the other Credit Documents; and
(c) The Borrower shall have paid all legal fees and other
closing or like costs and expenses of the Bank which
the Borrower is obligated to pay hereunder.
4.3 Conditions Precedent to All Loans. The obligation of the Bank to
make each Loan under this Agreement (including, without limitation, the initial
Loan) shall be subject to the further conditions precedent that, on the date of
each such Loan:
(a) The following statements shall be true: (1) the
representations and warranties of the Borrower
contained in this Agreement and the other Credit
Documents are correct on and as of the date of such
Loan as though made on and as of such date, and (2)
there exists no Default or Event of Default as of such
date, nor would any Default or Event of Default result
from the making of the Loan requested by the Borrower;
(b) The Borrower shall have signed and sent to the Bank, if
the Bank so requests, a request for advance, setting
forth in writing the amount of the Loan requested and
the other information required pursuant to this
Agreement; provided, however, that the foregoing
condition precedent shall not prevent the Bank, if it
so elects in its sole discretion, from making a Loan
pursuant to the Borrower's non-written request
therefor; and
(c) The Bank shall have received such other approvals,
opinions or documents as it may reasonably request.
The Borrower agrees that the making of a request by the Borrower for a Revolving
Credit Loan, whether in writing, by telephone or otherwise, shall constitute a
certification by the Borrower that all representations and warranties of the
Borrower in the Credit Documents are true as of the date thereof and that all
required conditions to the making of the Revolving Credit Loan have been met.
Section 5
Representations And Warranties
5.1 Representations, Warranties and Covenants of the Borrower. The
Borrower represents, and warrants to the Bank as follows:
(a) Organization and Existence. The Borrower (1) is a corporation
duly incorporated, validly existing and in good standing under the laws of the
state of its incorporation as reflected in the introductory paragraph of this
Agreement, (2) is in good standing in all other jurisdictions in which it is
required to be qualified to do business as a foreign corporation, and (3) has
obtained all licenses and permits and has filed all registrations necessary to
the operation of its business; except where the failure to so qualify or to
obtain such licenses or permits could not reasonably be expected to have a
Material Adverse Effect.
(b) Authorization by the Borrower. The execution, delivery and
performance by the Borrower of the Credit Documents (1) are within the
Borrower's corporate powers, (2) have been duly authorized by all necessary
corporate or similar action, (3) do not contravene the Borrower's articles or
certificate of incorporation or by-laws, or any law or contractual restriction
binding on or affecting the Borrower or its properties, and (4) do not result in
or require the creation of any Lien upon any of the Collateral other than a Lien
in favor of the Bank.
(c) Approval of Governmental Bodies. No authorization or approval
or other action by, and no notice to or filing with, any governmental authority
or regulatory body is required for the due execution, delivery and performance
by the Borrower of the Credit Documents or the exercise by the Bank of its
rights thereunder, including, without limitation, the sale or other disposition
of any of the Collateral to any Person.
(d) Enforceability of Obligations. The Credit Documents are the
legal, valid and binding obligations of the Borrower enforceable against the
Borrower in accordance with their respective terms, except as the enforceability
thereof may be limited by bankruptcy, insolvency, reorganization, moratorium, or
similar laws affecting the enforceability of creditors' rights generally and
subject to the discretion of courts in applying equitable remedies.
(e) Financial Statements. All financial statements of the
Borrower which have been furnished to the Bank fairly present the financial
condition of the Borrower, as of the dates reflected on the financial
statements, and fairly present the results of its operations for the period
covered thereby, all in accordance with GAAP, except for the omission of
footnotes in interim financial statements and subject to normal year-end
adjustments. As of the Closing Date, there has been no material adverse change
in the financial condition or results from operations of the Borrower since the
dates of the most recent financial statements of the Borrower submitted to the
Bank.
(f) Litigation. There is no pending or threatened action or
proceeding affecting the Borrower or any of its properties before any court,
governmental agency or arbitrator which, if determined adversely to the
Borrower, could reasonably be expected to have a Material Adverse Effect.
(g) Existing Debt. The Borrower has no Debt other than Permitted
Debt.
(h) Taxes. The Borrower has filed all required federal, state,
local and other tax returns and has paid, or made adequate provision for the
payment of, any taxes due pursuant thereto or pursuant to any assessment
received by the Borrower except such taxes, if any, as are being contested in
good faith and as to which adequate reserves have been provided.
(i) Stock and Records. All outstanding capital stock of the
Borrower was and is properly issued, and all books and records of the Borrower,
including but not limited to its minute books, by-laws and books of account, are
accurate and complete in all material respects. The Borrower is not obligated on
or after the Closing Date to redeem or otherwise acquire, or pay any dividends
or make any other distributions in respect of, any of its stock.
(j) Hazardous Materials. The Borrower has complied with all
Environmental Laws and all of its facilities, leaseholds, assets and other
property comply with all Environmental Laws, except where such failure to comply
could not reasonably be expected to have a Material Adverse Effect. There are no
outstanding or threatened citations, notices or orders of non-compliance issued
to the Borrower or relating to its facilities, leaseholds, assets or other
property. The Borrower has been issued all licenses, certificates, permits or
other authorizations required under any Environmental Law or by any federal,
state or local governmental or quasi-governmental entity, except where the
failure to obtain such license, certificate, permit or other authorization could
not reasonably be expected to have a Material Adverse Effect.
(k) Negative Pledges. The Borrower is not a party to or bound by
any indenture, contract or other instrument or agreement which prohibits the
creation, incurrence or sufferance to exist of any Lien upon any of the
Collateral.
(l) Title to Property; Liens. The Borrower has good and
marketable title to all property purported to be owned by it, and the Bank has a
perfected first priority Lien on all investment assets of the Borrower
(including, without limitation, all investment property), instruments, accounts
and general intangibles) subject to no Liens except for Permitted Liens.
(m) Insolvency. After the execution and delivery of the Credit
Documents and the disbursement of the initial Loan hereunder, the Borrower will
not be insolvent within the meaning of the United States Bankruptcy Code or
unable to pay its debts as they mature.
(n) Survival of Representations. All representations and
warranties made in this Section 5 shall survive the execution and delivery of
the Credit Documents and the making of the Loans.
Section 6
Covenants
6.1 Affirmative Covenants. So long as any Obligations remain unpaid or
the Bank has any commitment to extend credit to or for the benefit of the
Borrower, the Borrower covenants to the Bank as follows:
(a) Compliance with Laws. The Borrower shall comply with all
applicable laws, rules, regulations and orders affecting the Borrower or its
properties, including, without limitation, all Environmental Laws, except where
such failure to comply could not reasonably be expected to have a Material
Adverse Effect.
(b) Reporting Requirements. The Borrower shall furnish to the
Bank such information respecting the condition or operations, financial or
otherwise, of the Borrower as the Bank may reasonably request from time to time.
(c) Preservation of Business and Corporate Existence. The
Borrower shall: (1) carry on and conduct its principal business substantially as
it is now being conducted; (2) maintain in good standing its existence and its
right to transact business in those states in which it is required by applicable
law to be qualified to do business; and (3) maintain all licenses, permits and
registrations necessary to the conduct of its business; except where the failure
to so maintain its right to transact business or to maintain
such licenses, permits or registrations could not reasonably be expected to have
a Material Adverse Effect.
(d) Payment of Taxes. The Borrower shall pay and discharge,
before they become delinquent, all taxes, assessments and other governmental
charges imposed upon it, its properties, or any part thereof, or upon the income
or profits therefrom and all claims for labor, materials or supplies which if
unpaid might be or become a Lien or charge upon any of its property, except such
items as it is in good faith appropriately contesting and as to which adequate
reserves have been provided to the Bank's satisfaction.
(e) Employee Plans. The Borrower shall: (1) notify the Bank
promptly of the establishment of any Plan, except that prior to the
establishment of any "welfare plan" (as defined in Section 3(1) of ERISA)
covering any employee of the Borrower for any period after such employee's
termination of employment other than such period required by the Consolidated
Omnibus Budget Reconciliation Act of 1986 or "defined benefit plan" (as defined
in Section 3(35) of ERISA), it will obtain the Bank's prior written approval of
such establishment; (2) at all times make prompt payments or contributions to
meet the minimum funding standards of Section 412 of the Internal Revenue Code
of 1986, as amended, with respect to each Plan; (3) promptly after the filing
thereof, furnish to the Bank a copy of any report required to be filed pursuant
to Section 103 of ERISA in connection with each Plan for each Plan year,
including but not limited to the Schedule B attached thereto, if applicable; (4)
notify the Bank promptly of any "reportable event" (as defined in ERISA) or any
circumstances arising in connection with any Plan which might constitute grounds
for the termination thereof by the Pension Benefit Guaranty Corporation or for
the appointment by the appropriate United States District Court of a trustee to
administer the Plan, the initiation of any audit or inquiry by the Internal
Revenue Service or the Department of Labor of any Plan or transaction(s)
involving or related to any Plan, or any "prohibited transaction" as defined in
Section 406 of ERISA or Section 4975(c) of the Internal Revenue Code of 1986, as
amended; (5) notify the Bank prior to any action that could result in the
assertion of liability under Subtitle E of Title IV of ERISA caused by the
complete or partial withdrawal from any multiemployer plan or to terminate any
defined benefit plan sponsored by the Borrower; and (6) promptly furnish such
additional information concerning any Plan as the Bank may from time to time
request.
(f) Notice of Default. The Borrower shall give prompt written
notice to the Bank of the occurrence of any Default or Event of Default under
any of the Credit Documents. Similarly, the Borrower shall give prompt written
notice to the Bank of any failure to pay, perform or observe or any other
default by the Borrower under any other existing or future agreement by which
the Borrower is bound if such default could reasonably be expected to have a
Material Adverse Effect.
(g) Books and Records; Inspection; Bank Audits. The Borrower
shall: (1) maintain complete and accurate books and financial records in
accordance with GAAP (except that interim financial statements need not contain
footnotes and may be subject to normal year-end audit adjustments); (2) during
normal working hours permit the Bank and Persons designated by the Bank to visit
and inspect its properties, to inspect its books and financial records
(including its journals, orders, receipts and correspondence which relates to
its accounts receivable), and to discuss its affairs, finances and accounts
receivable and operations with its directors, officers, employees and agents and
its independent public accountants; and (3) permit the Bank and Persons
designated by the Bank to perform reviews of such books and financial records
when and as requested by the Bank.
(h) Bank May Perform Obligations; Further Assurances. After and
during the continuation of an Event of Default, the Borrower shall permit the
Bank, if the Bank so elects in its sole discretion, to pay or perform any of the
Borrower's Obligations hereunder or under the other Credit Documents and to
reimburse the Bank, on demand, or, if the Bank so elects, by the Bank making a
Revolving Credit Loan on the Borrower's behalf and disbursing the same to the
appropriate Persons, for all amounts expended by or on behalf of the Bank in
connection therewith and all costs and expenses
incurred by or on behalf of the Bank in connection therewith. The Borrower
further agrees to execute, deliver or perform, or cause to be executed,
delivered or performed, all such documents, agreements or acts, as the case may
be, as the Bank may reasonably request from time to time to create, perfect,
continue or otherwise assure the Bank with respect to any Lien created or
purported to be created by any of the Credit Documents or to otherwise create,
evidence or assure the Bank's rights and remedies under, or as contemplated by,
the Credit Documents or at law or in equity.
6.2 Negative Covenants. So long as any Obligations remain unpaid or
the Bank has any commitment to extend credit to or for the benefit of the
Borrower, the Borrower covenants to the Bank as follows:
(a) Liens. The Borrower shall not create or suffer to exist any
Lien on or with respect to any of its properties, whether the Borrower owns or
has an interest in such property on the Closing Date or at any time thereafter,
except for Permitted Liens.
(b) Debt. The Borrower shall not create or suffer to exist any
Debt except for Permitted Debt.
(c) Structure; Disposition of Assets. The Borrower shall not
merge or consolidate with or otherwise acquire, or be acquired by, any other
Person; provided, however, that the foregoing prohibition on acquisitions by the
Borrower shall not prohibit the Borrower from acquiring investment property in
the ordinary course of its business provided that such investment property is
promptly credited to the Securities Account. The Borrower shall not sell, lease
or otherwise transfer any property, except for the disposition of obsolete
equipment and except as otherwise permitted under the Security Agreement and the
Control Agreement with respect to the Collateral.
(d) Subsidiaries; New Business. The Borrower shall not create any
subsidiary, or render any services or otherwise enter into any business which is
not substantially similar to that existing on the Closing Date.
(e) Conflicting Agreements. The Borrower shall not enter into any
agreement any term or condition of which conflicts with any provision of this
Agreement or the other Credit Documents.
(f) Changes in Accounting Principles; Fiscal Year. The Borrower
shall not make any change in its principles or methods of accounting as
currently in effect, except such changes as are required by GAAP, nor shall the
Borrower, without first obtaining the Bank's written consent, change its fiscal
year.
(g) Transactions With Affiliates. Other than the advisor
relationship existing on the Closing Date with Tortoise Capital Advisors, LLC,
the Borrower shall not enter into or be a party to any transaction or
arrangement, including without limitation, the purchase, sale or exchange of
property of any kind or the rendering of any service, with any Affiliate, except
in the ordinary course of and pursuant to the reasonable requirements of the
Borrower's business and upon fair and reasonable terms substantially as
favorable to the Borrower as those which would be obtained in a comparable
arms-length transaction with a non-Affiliate.
(h) Amount Invested in Single MLP. The Borrower shall not make
any investment in any single master limited partnership or other single entity
if, at the time of such investment or after giving effect thereto, the fair
market value of such investment would exceed $25,000,000.
Section 7
Default
7.1 Events of Default. Each of the following events shall constitute
an Event of Default hereunder:
(a) General. The Borrower fails to pay, perform or
observe any Obligation or any other term, covenant or
other provision in any Credit Document in accordance
with the terms thereof and, if such default is curable,
the Borrower fails to cure such default within five
days after written notice from the Bank specifying in
reasonable detail the nature of such default is
received by the Borrower; provided, however, that the
Borrower shall not have any cure rights under this
Subsection (a) if the outstanding principal balance of
the Loans exceeds 80% of the Common Listed Equity Units
Value at any time after the Closing Date; or
(b) Other Bank Default. Any "Event of Default" (as
such term is defined in any other Credit Document to
which the Borrower is a party) occurs; or
(c) Misrepresentation. Any representation or warranty made
or furnished by the Borrower in connection with this
Agreement or the other Credit Documents proves to be
incorrect, incomplete or misleading in any material
respect when made, or any such representation or
warranty becomes incorrect, incomplete or misleading in
any material respect and the Borrower fails to give the
Bank prompt written notice thereof; or
(d) Cross-Default. The Borrower fails to pay any Debt
(other than a monetary Obligation due the Bank under
the Credit Documents, as contemplated by Subsection (a)
above) or to perform or observe any other obligation or
term in respect of such Debt, and, as a result of any
such failure, the holder of such Debt accelerates or is
entitled to accelerate the maturity thereof or requires
or is entitle to require the Borrower or some other
Person to purchase or otherwise acquire such Debt; or
(e) Insolvency. The Borrower ceases to be solvent or
suffers the appointment of a receiver, trustee,
custodian or similar fiduciary or makes an assignment
for the benefit of creditors; or any petition for an
order for relief is filed by or against the Borrower
under the federal Bankruptcy Code or any similar state
insolvency statute (except, in the case of a petition
filed against the Borrower, if such proceeding is
dismissed within 60 days after the petition is filed,
unless prior thereto an order for relief is entered
under the federal Bankruptcy Code); or the Borrower
makes any offer of settlement, extension or composition
to their respective unsecured creditors generally; or
(f) Contest Credit Documents. The Borrower challenges or
contests in any action, suit or proceeding the validity
or enforceability of any of the Credit Documents, the
legality or enforceability of any of the Obligations or
the validity, perfection or priority of any Lien
granted or purported to be granted to the Bank; or
(g) Judgments. One or more judgments, decrees or orders for
the payment of money in excess of $100,000 in the
aggregate during any 12-month period is rendered
against the Borrower; or
(h) Lien. The Bank shall cease to have a duly perfected
first priority security interest in the Collateral
subject to no Liens except for Permitted Liens.
7.2 Obligation to Lend; Acceleration. After the occurrence and during
the continuation of any Default, the Bank may declare the obligation of the Bank
to make Loans or to otherwise extend credit hereunder to be terminated,
whereupon the same shall forthwith terminate. After the occurrence and during
the continuation of any Event of Default, the Bank may declare the Note, all
interest thereon, and all other Obligations to be forthwith due and payable,
whereupon the Note, all such interest thereon and all such other Obligations
shall become and be forthwith due and payable, without presentment, protest or
further notice or demand of any kind, all of which are waived by the Borrower.
If, notwithstanding the foregoing, after the occurrence and during the
continuation of any Default or Event of Default, as the case may be, the Bank
elects (any such election to be in the Bank's sole and absolute discretion) to
make one or more advances under this Agreement or to not accelerate all or any
of the Obligations, any such election shall not preclude the Bank from electing
thereafter (in its sole and absolute discretion) to not make advances or to
accelerate all or any of the Obligations, as the case may be.
7.3 Remedies. Upon or after the occurrence and during the continuation
of any Event of Default, the Bank has and may exercise from time to time the
following rights and remedies:
(a) All of the rights and remedies of a secured party under the
UCC or under other applicable law, and all other legal and equitable rights to
which the Bank may be entitled, all of which rights and remedies shall be
cumulative, and none of which shall be exclusive, and all of which shall be in
addition to any other rights or remedies contained in this Agreement or any of
the other Credit Documents.
(b) The right to take immediate possession of the Collateral, and
(1) to require the Borrower to assemble the Collateral, at the Borrower's
expense, and make it available to the Bank at a place designated by the Bank
which is reasonably convenient to both parties, and (2) to enter upon and use
any premises in which the Borrower has an ownership, leasehold or other
interest, or wherever any of the Collateral shall be located, and to store,
remove, abandon, sell, dispose of or otherwise use all or any part of the
Collateral on such premises without the payment of rent or any other fees by the
Bank to the Borrower or any other Person for the use of such premises or such
Collateral.
(c) The right to sell or otherwise dispose of all or any
Collateral at public or private sale or sales, with such notice as may be
required by law, in lots or in bulk, for cash or on credit, all as the Bank, in
its sole discretion, may deem advisable. The Borrower agrees that not less than
10 days prior written notice to the Borrower of any public or private sale or
other disposition of such Collateral shall be reasonable notice thereof, and
such sale shall be at such locations as the Bank may designate in such notice.
The Bank has the right to conduct such sales on the Borrower's premises, without
charge therefor, and such sales may be adjourned from time to time in accordance
with applicable law. The Bank has the right to sell, lease or otherwise dispose
of such Collateral, or any part thereof, for cash, credit or any combination
thereof, and the Bank may purchase all or any part of such Collateral at public
or, if permitted by law, private sale and, in lieu of actual payment of such
purchase price, may set-off or credit the amount of such price against the
Obligations.
(d) The proceeds realized from the sale of any Collateral may be
applied, after the Bank is in receipt of good funds, as follows: first, to the
reasonable costs, expenses and attorneys' fees and expenses incurred by the Bank
for collection and for acquisition, completion, protection, removal, storage,
sale and delivery of the Collateral; second, to any fees or expenses due the
Bank under the Credit Documents; third, to interest due upon any of the
Obligations; and fourth, to the principal of the Obligations; or in such other
manner as the Bank may elect in its sole discretion. If any deficiency shall
arise, the Borrower shall remain liable to the Bank therefor. Any surplus
remaining after payment in full of the Obligations may be returned to the
Borrower or to whomever may be legally entitled thereto.
7.4 Right of Set-off. Upon or after the occurrence and during the
continuation of any Event of Default, the Bank is authorized at any time and
from time to time, without notice to the Borrower (any such notice being waived
by the Borrower), to set off and apply any and all deposits (general or special,
time or demand, provisional or final) at any time held and other indebtedness at
any time owing by the Bank to or for the credit or the account of the Borrower
against any and all of the Obligations irrespective of whether or not the Bank
has made any demand under this Agreement or the other Credit Documents and
although such Obligations may be unmatured. The rights of the Bank under this
Section are in addition to other rights and remedies (including, without
limitation, other rights of setoff) which the Bank may have.
Section 8
Miscellaneous
8.1 Notices. Except as otherwise provided herein, all notices,
requests and demands to or upon a party to this Agreement to be effective shall
be in writing and shall be deemed validly given upon receipt thereof, whether by
personal delivery, U.S. mail, fax, other electronic transmission or otherwise,
in each case addressed as follows:
If to the Bank:
U.S. Bank National Association ▇▇▇▇ ▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇
Attn.: ▇▇. ▇▇▇▇ ▇▇▇▇▇▇▇ Fax No.:
▇▇▇-▇▇▇-▇▇▇▇
with a copy (which shall not constitute
notice) to:
Shook, Hardy & Bacon L.L.P.
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇.
▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn.: ▇▇▇▇ ▇▇▇▇▇▇▇▇, Esq.
Fax No.: ▇▇▇-▇▇▇-▇▇▇▇
If to the Borrower:
Tortoise North American Energy Corporation
▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇
Attn.: ▇▇▇▇▇ ▇▇▇▇▇▇▇
Fax No.: ▇▇▇-▇▇▇-▇▇▇▇
with a copy (which shall not constitute notice) to:
▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ LLP
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn.: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, Esq.
Fax No.: ▇▇▇-▇▇▇-▇▇▇▇
or to such other address or telecopy number as each party may designate for
itself by like notice given in accordance with this Section.
8.2 Power of Attorney. The Borrower irrevocably designates, makes,
constitutes and appoints the Bank, and all Persons designated by the Bank, as
the Borrower's true and lawful attorney and agent-in-fact (such power of
attorney and agency being coupled with an interest and therefore irrevocable
until the Obligations have been indefeasibly paid in full and the Bank has no
duty to extend credit to or for the benefit of the Borrower), and the Bank, and
any Persons designated by the Bank, may, at any time except as otherwise
provided below, and without notice to or the consent of the Borrower and in
either the Borrower's or the Bank's name, but at the cost and expense of the
Borrower, (1) pay and perform any Obligation to be paid or performed under any
of the Credit Documents, (2) endorse the Borrower's name on any checks, notes,
acceptances, drafts, money orders or any other evidence of payment or proceeds
of the Collateral which come into the possession of the Bank or under the Bank's
control, and (3) at any time an Event of Default exists, (a) to the extent the
Collateral may be realized upon by collection, demand payment of all such
Collateral from the obligors thereunder, enforce payment of such Collateral by
legal proceedings or otherwise, and generally exercise all of the Borrower's
rights and remedies with respect to such Collateral, (b) settle, adjust,
compromise, discharge or release any Collateral or any legal proceedings brought
to collect any of the Collateral, (c) sell or otherwise transfer any Collateral
upon such terms, for such amounts and at such time or times as the Bank deems
advisable, (d) take control, in any manner, of any item of payment or proceeds
relating to any Collateral, (e) prepare, file and sign the Borrower's name to a
proof of claim in bankruptcy or similar document against any Collateral obligor
or to any notice of Lien, assignment or satisfaction of Lien or similar document
in connection with any of the Collateral, (f) endorse the name of the Borrower
upon any of the items of payment or proceeds relating to any Collateral and
deposit the same to the account of the Bank on account of the Obligations, (g)
endorse the name of the Borrower upon any document of transfer or other document
or agreement relating to any Collateral, (h) use the information recorded on or
contained in any data processing equipment and computer hardware and software
relating to any Collateral and to which the Borrower has access, and (i) do all
other acts and things necessary, in the Bank's determination, to fulfill the
Borrower's obligations under this Agreement.
8.3 Indemnity. The Borrower agrees to indemnify, defend and hold
harmless the Bank and each shareholder, director, officer, employee, agent,
attorney and other representative of or contractor for the Bank from and against
any and all damages, settlement amounts, expenses (including, without
limitation, attorney's fees and court costs), other losses, claims or other
assertions of liability of any nature whatsoever incurred by or on behalf of or
asserted against, as the case may be, any one or more of such indemnified
parties at any time arising in whole or in part out of the Borrower's failure to
observe, perform or discharge any of the Borrower's duties under any of the
Credit Documents or any misrepresentation made by or on behalf of the Borrower
under any of the Credit Documents. Without limiting the generality of the
foregoing, this indemnity shall extend to any claims asserted against the Bank
or such other indemnitees by any Person under any Environmental Laws or similar
laws by reason of the Borrower's or any other Person's failure to comply with
laws applicable to Hazardous Substances. The Borrower further agrees to
indemnify, defend and hold harmless the Bank and each shareholder, director,
officer, employee, agent, attorney and other representative of or contractor for
the Bank from and against any and all damages, settlement amounts, expenses
(including, without limitation, attorneys' fees and court costs), other losses,
claims or other assertions of liability of any nature whatsoever incurred by or
on behalf of or asserted against, as the case may be, any one or more of such
indemnified parties at any time in connection with any one or more indemnified
parties' actions or inactions relating in any respect to the Credit Agreement,
any of the other Credit Documents or any of the transactions described in or
contemplated by any of the foregoing, except to the extent such losses arise out
of such indemnified party's gross negligence or willful misconduct. All
indemnities given by the Borrower to the Bank under the Credit Documents,
including, without limitation, the indemnities set forth in this Section, shall
survive the repayment of the Loans and the termination of this Agreement.
8.4 Entire Agreement; Modification of Agreement; Sale of Interest.
This Agreement and the other Credit Documents, together with all other
instruments, agreements and certificates executed by the parties in connection
therewith or with reference thereto, embodies the entire agreement between the
parties hereto and thereto with respect to the subject matter hereof and thereof
and supersedes all prior agreements, understandings and inducements, whether
express or implied, oral or written. This Agreement may not be modified, altered
or amended, except by an agreement in writing signed by the Borrower and the
Bank. The Borrower may not directly or indirectly sell, assign or transfer any
interest in or rights under this Agreement or any of the other Credit Documents.
The Borrower consents to the Bank's participation, sale, assignment, transfer or
other disposition, at any time or times on or after the Closing Date, of this
Agreement and any of the other Credit Documents, or of any portion hereof or
thereof, including, without limitation, the Bank's rights, title, interests,
remedies, powers and duties hereunder or thereunder; provided, however, that,
unless an Event of Default is then in effect or the Termination Date has
occurred, the Bank shall not have the right to sell this Agreement or any of the
other Credit Documents without first obtaining the Borrower's prior written
consent thereto.
8.5 Reimbursement of Expenses. If, at any time or times prior or
subsequent to the Closing Date, regardless of whether an Event of Default then
exists or any of the transactions contemplated hereunder are concluded, the Bank
employs counsel for advice or other representation, or incurs reasonable legal
and/or appraisers', liquidators', investment bankers' expenses and/or other
costs or out-of-pocket expenses in connection with: (a) the negotiation and
preparation of this Agreement and any of the other Credit Documents, any
amendment or other modification of this Agreement or any of the other Credit
Documents; (b) any litigation, contest, dispute, suit, proceeding or action
(whether instituted by the Bank, the Borrower or any other Person) in any way
relating to the Collateral, this Agreement, any of the other Credit Documents or
the Borrower's affairs; (c) any attempt to enforce any rights of the Bank
against the Borrower or any other Person which may be obligated to the Bank by
virtue of this Agreement or any of the other Credit Documents, including,
without limitation, any account debtors, irrespective of whether litigation is
commenced in pursuance of such rights; and/or (d) any attempt to inspect,
verify, protect, preserve, restore, collect, sell, manufacture, liquidate or
otherwise dispose of or realize upon the Collateral (all of which are
hereinafter collectively referred to as the "Expenses"); then, in any and each
such event, such Expenses shall be payable on demand by the Borrower to the
Bank, and shall be additional Obligations and be secured by the Collateral and
may be funded, if the Bank so elects, by the Bank making a Revolving Credit Loan
or other loan under this Agreement on the Borrower's behalf and paying the same
to the Persons to whom such Expenses are payable. Additionally, if any taxes
(excluding taxes imposed upon or measured by the income of the Bank) shall be
payable on account of the execution or delivery of this Agreement or the other
Credit Documents, or the execution, delivery, issuance or recording of any of
the Credit Documents, or the creation of any of the Obligations hereunder, by
reason of any federal, state or local statute or other law existing on or after
the Closing Date, the Borrower will pay all such taxes, including, but not
limited to, any interest and penalties thereon, and will indemnify and hold the
Bank harmless from and against all liabilities in connection therewith.
8.6 Indulgences Not Waivers. The Bank's failure, at any time or times
on or after the Closing Date, to require strict performance by the Borrower of
any provision of this Agreement or the other Credit Documents shall not waive,
affect or diminish any right of the Bank thereafter to demand strict compliance
and performance therewith. Any suspension or waiver by the Bank of a Default or
an Event of Default by the Borrower under this Agreement or any of the other
Credit Documents shall not suspend, waive or affect any other Default or Event
of Default by the Borrower under this Agreement or any of the other Credit
Documents, whether the same is prior or subsequent thereto and whether of the
same or of a different type. None of the undertakings, agreements, warranties,
covenants and representations of the Borrower contained in this Agreement or any
of the other Credit Documents and no Default or Event of Default by the Borrower
under this Agreement or any of the other Credit Documents shall be deemed to
have been suspended or waived by the Bank, unless such suspension or waiver is
by an instrument in writing specifying such suspension or waiver and is signed
by a duly authorized representative of the Bank and directed and delivered to
the Borrower.
8.7 Severability. Wherever possible, each provision of this Agreement
shall be interpreted in such manner as to be effective and valid under
applicable law, but if any provision of this Agreement
shall be prohibited by or invalid under applicable law, such provision shall be
ineffective only to the extent of such prohibition or invalidity, without
invalidating the remainder of such provision or the remaining provisions of this
Agreement.
8.8 Successors and Assigns. This Agreement and the other Credit
Documents, shall be binding upon and inure to the benefit of the successors and
assigns of the Borrower and the Bank. This provision, however, shall not be
deemed to modify Section 8.4 hereof.
8.9 General Waivers by Borrower. Except as otherwise expressly
provided for in this Agreement, the Borrower waives: (a) presentment, protest,
demand for payment, notice of dishonor demand and protest and notice of
presentment, default, notice of nonpayment, maturity, release, compromise,
settlement, extension or renewal of any or all commercial paper, accounts
receivable, contract rights, documents, instruments, chattel paper and
guaranties at any time held by the Bank on which the Borrower may in any way be
liable and ratifies and confirms whatever the Bank may do in this regard; (b)
notice prior to taking possession or control of the Collateral or any bond or
security which might be required by any court prior to allowing the Bank to
exercise any of the Bank's remedies, including the issuance of an immediate writ
of possession; (c) the benefit of all valuation, appraisement and exemption
laws; and (d) any and all other notices, demands and consents in connection with
the delivery, acceptance, performance, default or enforcement of this Agreement
or any of the other Credit Documents and/or any of the Bank's rights in respect
of the Collateral. Subject to the following sentence, the Borrower also waives
any right of setoff or similar right the Borrower may at any time have against
the Bank as a defense to the payment or performance of the Borrower's
Obligations. If the Borrower now or hereafter has any claim against the Bank
giving rise to any such right of setoff or similar right, the Borrower agrees
not to assert such claim as a defense or right of setoff with respect to the
Borrower's Obligations under the Credit Documents or otherwise, and to instead
assert any such claim, if the Borrower so elects to assert such claim, in a
separate proceeding against the Bank and not as a part of any proceeding or as a
defense to any claim initiated by the Bank to enforce any of the Bank's rights
under any of the Credit Documents.
8.10 Execution in Counterparts; Facsimile Signatures. This Agreement
and the other Credit Documents may be executed in any number of counterparts and
by different parties thereto, each of which when so executed and delivered shall
be deemed to be an original and all of which counterparts taken together shall
constitute but one and the same instrument. A signature of a party to any of the
Credit Documents sent by facsimile or other electronic transmission shall be
deemed to constitute an original and fully effective signature of such party.
8.11 USA Patriot Act Notice. The Bank notifies the Borrower that,
pursuant to the requirements of the USA Patriot Act (Title III of Pub. L. 107-56
(signed into law October 26, 2001) (the "Act"), it is required to obtain, verify
and record information that identifies the Borrower, which information includes
the name and address of the Borrower and other information that will allow the
Bank to identify the Borrower in accordance with the Act. The Borrower agrees to
provide such information and take such other action as the Bank may request from
time to time to enable the Bank to comply with the provisions of the Act with
respect to the transactions described in the Credit Documents.
8.12 Governing Law; Consent to Forum. This Agreement shall be governed
by the laws of the State of Kansas without giving effect to any choice of law
rules thereof. As part of the consideration for new value this day received, the
Borrower consents to the jurisdiction of any state court located in ▇▇▇▇▇▇▇
County, Kansas or any federal court located in Wyandotte County, Kansas
(collectively, the "Chosen Forum"), and waives personal service of any and all
process upon it and consents that all such service of process be made by
certified or registered mail directed to the Borrower at the address stated in
Section 8.1 hereof and service so made shall be deemed to be completed upon
delivery thereto. The Borrower waives any objection to jurisdiction and venue of
any action instituted against it as provided herein and agrees not to assert any
defense based on lack of jurisdiction or venue. The Borrower further
agrees not to assert against the Bank (except by way of a defense or
counterclaim in a proceeding initiated by the Bank) any claim or other assertion
of liability relating to any of the Credit Documents, the Obligations, the
Collateral or the Bank's actions or inactions in respect of any of the foregoing
in any jurisdiction other than the Chosen Forum. Nothing in this Agreement shall
affect the Bank's right to bring any action or proceeding relating to this
Agreement or the other Credit Documents against the Borrower or its properties
in courts of other jurisdictions.
8.13 Waiver of Jury Trial; Limitation on Damages. To the fullest
extent permitted by law, and as separately bargained-for consideration to the
Bank, the Borrower waives any right to trial by jury (which the Bank also
waives) in any action, suit, proceeding or counterclaim of any kind arising out
of or otherwise relating to any of the Credit Documents, the Obligations, the
Collateral or the Bank's actions or inactions in respect of any of the
foregoing. To the fullest extent permitted by law, and as separately
bargained-for consideration to the Bank, the Borrower also waives any right it
may have at any time to claim or recover in any litigation or other dispute
involving the Bank, whether the underlying claim or dispute sounds in contract,
tort or otherwise, any special, exemplary, punitive or consequential damages or
any damages other than, or in addition to, actual damages. The Borrower
acknowledges that the Bank is relying upon and would not enter into the
transactions described in the Credit Documents on the terms and conditions set
forth therein but for the Borrower's waivers and agreements under this Section.
[remainder of page intentionally left blank]
8.14 K.S.A. §16-118 Required Notice. This statement is provided
pursuant to K.S.A. §16-118: "THIS CREDIT AGREEMENT IS A FINAL EXPRESSION OF THE
CREDIT AGREEMENT BETWEEN THE CREDITOR AND THE DEBTOR AND SUCH WRITTEN CREDIT
AGREEMENT MAY NOT BE CONTRADICTED BY EVIDENCE OF ANY PRIOR ORAL CREDIT AGREEMENT
OR OF A CONTEMPORANEOUS ORAL CREDIT AGREEMENT BETWEEN THE CREDITOR AND DEBTOR."
THE FOLLOWING SPACE CONTAINS ANY NON-STANDARD TERMS, INCLUDING THE REDUCTION TO
WRITING OF ANY PREVIOUS ORAL CREDIT AGREEMENT:
NONE.
The creditor and debtor, by their respective initials or signatures below,
confirm that no unwritten credit agreement exists between the parties:
Creditor: /s/ PT
----------------------------------
Debtor: /s/ TM
------------------------------------
[signature page(s) to follow]
IN WITNESS WHEREOF, the parties have caused this Agreement to be executed
and delivered by their duly authorized representatives as of the date first
above written.
TORTOISE NORTH AMERICAN ENERGY CORPORATION
By: /s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇
----------------------------------------
Name: ▇▇▇▇▇ ▇▇▇▇▇▇▇
Title: Chief Financial Officer
U.S. BANK NATIONAL ASSOCIATION
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇
---------------------------------------
Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: Senior Vice President
Exhibit A
REVOLVING CREDIT NOTE
$40,000,000 January 31, 2006
For value received, the undersigned, TORTOISE NORTH AMERICAN ENERGY
CORPORATION, a Maryland corporation (the "Borrower"), promises to pay to the
order of U.S. BANK NATIONAL ASSOCIATION, a national banking association (the
"Bank"; which term shall include any subsequent holder hereof), in lawful money
of the United States of America, without setoff, deduction or counterclaim, the
principal sum of Forty Million and 00/100 Dollars ($40,000,000.00) or, if
different, the principal amount outstanding under Section 2.2 of the Credit
Agreement referred to below.
This Revolving Credit Note (the "Note") is the Revolving Credit Note
referred to in, is issued pursuant to, and is subject to the terms and
conditions of, the Credit Agreement, dated as of or on or about January 31,
2006, between the Borrower and the Bank, as the same may be amended, renewed,
restated, replaced, consolidated or otherwise modified from time to time (the
"Credit Agreement"). To the extent of any direct conflict between the terms and
conditions of this Note and the terms and conditions of the Credit Agreement,
the terms and conditions of the Credit Agreement shall prevail and govern.
Capitalized terms used and not defined in this Note have the meanings given to
them in the Credit Agreement.
Interest shall accrue on the outstanding principal balance of this Note
as provided in the Credit Agreement. Principal, interest and all other amounts,
if any, payable in respect of this of this Note shall be payable as provided in
the Credit Agreement. The Borrower's right, if any, to prepay this Note is
subject to the terms and conditions of the Credit Agreement.
The termination of the Credit Agreement or the occurrence of an Event
of Default shall entitle the Bank, at its option, to declare the then
outstanding principal balance hereof, all accrued interest thereon, and all
other amounts, if any, payable in respect of this Note to be, and the same shall
thereupon become, immediately due and payable without notice to or demand on the
Borrower, all of which the Borrower waives.
Time is of the essence of this Note. To the fullest extent permitted by
applicable law, the Borrower, for itself and its successors and assigns, waives
presentment, demand, protest, notice of dishonor, and any and all other notices,
demands and consents in connection with the delivery, acceptance, performance,
default or enforcement of this Note, and consents to any extensions of time,
renewals, releases of any parties to or guarantors of this Note, waivers and any
other modifications that may be granted or consented to by the Bank from time to
time in respect of the time of payment or any other provision of this Note.
This Note shall be governed by the laws of the State of Kansas, without
regard to any choice of law rule thereof which gives effect to the laws of any
other jurisdiction.
[signature page to follow]
Exhibit A - Page 1
IN WITNESS WHEREOF, the Borrower has executed and delivered this Note
as of the date first above written.
TORTOISE NORTH AMERICAN ENERGY CORPORATION
By:
----------------------------------------
Name:
Title:
Exhibit A - Page 2
