EXHIBIT 10.20
Execution Copy
================================================================================
364-DAY CREDIT AGREEMENT
Dated as of December 11, 2002
among
CITGO PETROLEUM CORPORATION,
as the Borrower,
BANK OF AMERICA, N.A.,
as Administrative Agent,
JPMORGAN CHASE BANK,
as Syndication Agent,
SOCIETE GENERALE,
as Documentation Agent,
and
The Other Lenders Party Hereto
BANC OF AMERICA SECURITIES LLC,
AND
JPMORGAN SECURITIES INC.,
as
Joint Lead Arrangers and Co-Book Managers
================================================================================
TABLE OF CONTENTS
ARTICLE I. DEFINITIONS AND ACCOUNTING TERMS......................................................................1
1.01 Defined Terms...............................................................................1
1.02 Other Interpretive Provisions..............................................................20
1.03 Accounting Terms...........................................................................21
1.04 Rounding...................................................................................21
1.05 References to Agreements and Laws..........................................................21
1.06 Times of Day...............................................................................21
ARTICLE II. THE COMMITMENTS AND BORROWINGS......................................................................21
2.01 Loans......................................................................................21
2.02 Borrowings, Conversions and Continuations of Loans.........................................22
2.03 Prepayments................................................................................23
2.04 Termination or Reduction of Commitments....................................................24
2.05 Repayment of Loans.........................................................................24
2.06 Interest...................................................................................24
2.07 Fees.......................................................................................25
2.08 Computation of Interest and Fees...........................................................26
2.09 Evidence of Debt...........................................................................26
2.10 Payments Generally.........................................................................26
2.11 Sharing of Payments........................................................................28
2.12 Extension of Maturity Date.................................................................28
2.13 Term-Out Option............................................................................29
ARTICLE III. TAXES, YIELD PROTECTION AND ILLEGALITY.............................................................30
3.01 Taxes......................................................................................30
3.02 Illegality.................................................................................31
3.03 Inability to Determine Rates...............................................................32
3.04 Increased Cost and Reduced Return; Capital Adequacy; Reserves on Eurodollar Rate
Loans......................................................................................32
3.05 Funding Losses.............................................................................33
3.06 Matters Applicable to all Requests for Compensation........................................33
3.07 Survival...................................................................................34
ARTICLE IV. CONDITIONS PRECEDENT TO CREDIT EXTENSIONS...........................................................34
4.01 Conditions of Initial Borrowing............................................................34
4.02 Conditions to all Borrowings...............................................................36
ARTICLE V. REPRESENTATIONS AND WARRANTIES.......................................................................36
5.01 Corporate Existence: Power; Compliance with Laws...........................................36
5.02 Corporate Authorization; No Contravention..................................................37
5.03 Governmental Authorization; Other Consents.................................................37
5.04 Binding Effect.............................................................................37
5.05 Litigation.................................................................................38
5.06 No Default.................................................................................38
5.07 Fire, Strike, Act of God, etc..............................................................38
5.08 Liens......................................................................................38
5.09 ERISA......................................................................................38
5.10 Use of Proceeds; Margin Regulations........................................................39
5.11 Title to Properties........................................................................39
5.12 Taxes......................................................................................39
i
5.13 Financial Condition........................................................................40
5.14 Environmental Matters......................................................................40
5.15 Regulated Entities.........................................................................41
5.16 Copyrights, Patents, Trademarks and Licenses, etc..........................................41
5.17 Subsidiaries...............................................................................41
5.18 Solvency...................................................................................41
5.19 Full Disclosure............................................................................41
ARTICLE VI. AFFIRMATIVE COVENANTS...............................................................................42
6.01 Financial Statements.......................................................................42
6.02 Certificates; Other Information............................................................43
6.03 Notices....................................................................................44
6.04 Preservation of Corporate Existence, Etc...................................................44
6.05 Insurance..................................................................................45
6.06 Taxes......................................................................................45
6.07 Compliance with Laws.......................................................................45
6.08 Compliance with Material Contractual Obligations...........................................46
6.09 Inspection of Property and Books and Records...............................................46
6.10 Maintenance of Properties..................................................................47
6.11 Use of Proceeds............................................................................47
ARTICLE VII. NEGATIVE COVENANTS.................................................................................47
7.01 Negative Covenants Applicable to the Borrower and Restricted Subsidiaries..................47
7.02 Financial Covenants........................................................................55
ARTICLE VIII. EVENTS OF DEFAULT.................................................................................55
8.01 Event of Default...........................................................................55
8.02 Remedies Upon Event of Default.............................................................57
8.03 Application of Funds.......................................................................58
ARTICLE IX. ADMINISTRATIVE AGENT................................................................................59
9.01 Appointment and Authorization of Administrative Agent......................................59
9.02 Delegation of Duties.......................................................................59
9.03 Liability of Administrative Agent..........................................................59
9.04 Reliance by Administrative Agent...........................................................60
9.05 Notice of Default..........................................................................60
9.06 Credit Decision; Disclosure of Information by Administrative Agent.........................60
9.07 Indemnification of Administrative Agent....................................................61
9.08 Administrative Agent in its Individual Capacity............................................61
9.09 Successor Administrative Agent.............................................................62
9.10 Administrative Agent May File Proofs of Claim..............................................62
9.11 Other Agents; Arrangers and Managers.......................................................63
ARTICLE X. MISCELLANEOUS........................................................................................63
10.01 Amendments, Etc............................................................................63
10.02 Notices and Other Communications; Facsimile Copies.........................................64
10.03 No Waiver; Cumulative Remedies.............................................................65
10.04 Attorney Costs, Expenses and Taxes.........................................................66
10.05 Indemnification by the Borrower............................................................66
10.06 Payments Set Aside.........................................................................67
10.07 Successors and Assigns.....................................................................67
10.08 Confidentiality............................................................................70
10.09 Set-off....................................................................................71
ii
10.10 Interest Rate Limitation...................................................................72
10.11 Counterparts...............................................................................72
10.12 Integration................................................................................72
10.13 Survival of Representations and Warranties.................................................72
10.14 Severability...............................................................................72
10.15 Tax Forms..................................................................................73
10.16 Replacement of Lenders.....................................................................74
10.17 Governing Law..............................................................................75
10.18 Waiver of Right to Trial by Jury...........................................................75
10.19 Termination of Commitments Under Existing Credit Agreements................................75
10.20 Entire Agreement...........................................................................76
SIGNATURES.............................................................................................S-1
iii
SCHEDULES
2.01 Commitments and Pro Rata Shares
4.01 Qualifications as a Foreign Corporation
5.13(c) Off-Balance Sheet Liabilities
5.13(d) Potential Material Adverse Effect
5.14 Environmental Matters
5.17 Subsidiaries and Other Equity Investments
7.01(a) Existing Liens
7.01(c) Existing Investments
10.02 Administrative Agent's Office, Certain Addresses for Notices
EXHIBITS
FORM OF
A Loan Notice
B Note
C Compliance Certificate
D Assignment and Assumption
E-1 and E-2 Form of Opinions of Counsel to the Borrower
E-3 Form of Opinion of Counsel to PDVSA
iv
CREDIT AGREEMENT
This CREDIT AGREEMENT ("Agreement") is entered into as of December 11,
2002, among
CITGO PETROLEUM CORPORATION, a Delaware corporation (the
"Borrower"), each lender from time to time party hereto (collectively, the
"Lenders" and individually, a "Lender"), and BANK OF AMERICA, N.A., as
Administrative Agent.
WHEREAS, the Borrower has requested that the Lenders provide a
revolving credit facility, and the Lenders are willing to do so on the terms and
conditions set forth herein.
NOW, THEREFORE, in consideration of the mutual covenants and agreements
herein contained, the parties hereto covenant and agree as follows:
ARTICLE I.
DEFINITIONS AND ACCOUNTING TERMS
1.01 DEFINED TERMS. As used in this Agreement, the following terms
shall have the meanings set forth below:
"Administrative Agent" means Bank of America in its capacity as
administrative agent under any of the Loan Documents, or any successor
administrative agent.
"Administrative Agent's Office" means the Administrative Agent's
address and, as appropriate, account as set forth on Schedule 10.02, or such
other address or account as the Administrative Agent may from time to time
notify the Borrower and the Lenders.
"Administrative Questionnaire" means an Administrative Questionnaire in
a form supplied by the Administrative Agent.
"Affiliate" means, as to any Person, (a) any other Person which,
directly or indirectly, is in control of, is controlled by, or is under common
control with, such Person or (b) in the case of the Borrower or any Subsidiary,
any Person who is a director or officer of such Person or of any Person
described in the foregoing clause (a). For purposes of this definition,
"control" (and with correlative meaning "controlled" and "under common control")
of a Person shall mean (i) the power, direct or indirect, (A) to vote 50% or
more of the securities having ordinary voting power for the election of
directors of such Person or (B) to direct or cause the direction of the
management and policies of the other Person, whether through the ownership of
voting securities, by contract, or otherwise or (ii) the ownership, direct or
indirect, of 10% or more of any class of Voting Stock of such Person (if such
class of Voting Stock is publicly held).
"Affiliate Guarantee Transaction" means any transaction in which the
Borrower or any Subsidiary of the Borrower shall guarantee any Indebtedness or
obligations of any Person that is at the time an Affiliate of the Borrower or of
such Subsidiary, as the case may be, provided that, as of the date of such
guarantee, the Borrower would be in compliance with each of Sections 7.02(a) and
(c) of this Agreement.
1
"Agent-Related Persons" means the Administrative Agent, together with
its Affiliates (including, in the case of Bank of America in its capacity as the
Administrative Agent, Banc of America Securities LLC), and the officers,
directors, employees, agents and attorneys-in-fact of such Persons and
Affiliates.
"Aggregate Commitment" or "Aggregate Commitments" mean the Commitments
of all the Lenders.
"Agreement" means this Credit Agreement.
"Applicable Rate" means the following percentages per annum based upon
the most recent Compliance Certificate received by the Administrative Agent
pursuant to Section 6.02(a):
APPLICABLE RATE
(IN BASIS POINTS)
EURODOLLAR EURODOLLAR
RATE RATE
PRICING CAPITALIZATION FACILITY UTILIZATION APPLICABLE TO BASE APPLICABLE
LEVEL RATIO FEE FEE REVOLVER LOANS RATE TO TERM LOANS
-------------- ------------------------ ------------ -------------- ----------------- ---------- --------------
1 < 35.00:1 25.0 25.0 87.5 0.0 112.5
2 > or = 35.00:1 but <40.00:1 30.0 25.0 107.5 0.0 132.5
3 > or = 40.00:1 but <50.00:1 32.5 25.0 117.5 0.0 142.5
4 > or =50.00:1 35.0 25.0 127.5 0.0 152.5
Any increase or decrease in the Applicable Rate resulting from a change in the
Capitalization Ratio shall become effective as of the first Business Day
immediately following the date a Compliance Certificate is delivered pursuant to
Section 6.02(a); provided, however, that if a Compliance Certificate is not
delivered when due in accordance with such Section, then Pricing Level 4 shall
apply as of the first Business Day after the date on which such Compliance
Certificate was required to have been delivered until such Compliance
Certificate has been delivered. The Applicable Rate in effect from the Closing
Date to the next date of determination shall be determined based upon Pricing
Level 2.
"Arrangers" means Banc of America Securities LLC and JPMorgan
Securities Inc., in their capacity as joint lead arrangers and co-book managers.
"Assignment and Assumption" means an Assignment and Assumption
substantially in the form of Exhibit D.
"Attorney Costs" means and includes (a) with respect to the
negotiation, syndication, preparation, execution and delivery of this Agreement
and each other Loan Document and any modifications or waivers related thereto,
all reasonable fees and disbursements of any law firm
2
or other external counsel and the allocated cost of internal legal services and
all disbursements of internal counsel to the extent that the services performed
by internal counsel do not duplicate services performed by external counsel;
provided that invoices for such fees and disbursements shall be rendered in
reasonable detail; and (b) with respect to each particular matter regarding
enforcement or protection of the rights of any Lender, the Administrative Agent
in connection with enforcement or protection of its rights pursuant to this
Agreement, all reasonable fees and disbursements of any law firm or other
external counsel (including, if such Person has not elected to use outside
counsel for such particular matter or if the Company shall have consented, the
allocated cost of internal legal services and all disbursements of internal
legal counsel for such matter).
"Attributable Indebtedness" means, on any date, in respect of any
Synthetic Lease obligation, the capitalized amount of the remaining lease
payments under the relevant lease that would appear on a balance sheet of such
Person prepared as of such date in accordance with GAAP if such lease were
accounted for as a capital lease.
"Audited Financial Statements" means the audited consolidated balance
sheet of the Borrower and its consolidated Subsidiaries for the fiscal year
ended December 31, 2001, and the related consolidated statements of income or
operations, shareholder's equity and cash flows for such fiscal year of the
Borrower and its Subsidiaries, including the notes thereto.
"Availability Period" means the period from and including the Closing
Date to the Maturity Date.
"Bank of America" means Bank of America, N.A. and its successors.
"Base Rate" means for any day a fluctuating rate per annum equal to the
higher of (a) the Federal Funds Rate plus 1/2 of 1% and (b) the rate of interest
in effect for such day as publicly announced from time to time by Bank of
America as its "prime rate." The "prime rate" is a rate set by Bank of America
based upon various factors including Bank of America's costs and desired return,
general economic conditions and other factors, and is used as a reference point
for pricing some loans, which may be priced at, above, or below such announced
rate. Any change in such rate announced by Bank of America shall take effect at
the opening of business on the day specified in the public announcement of such
change.
"Base Rate Loan" means a Loan that bears interest based on the Base
Rate.
"Borrower" has the meaning specified in the introductory paragraph
hereto.
"Borrowing" means a borrowing consisting of simultaneous Loans of the
same Type and, in the case of Eurodollar Rate Loans, having the same Interest
Period made by each of the Lenders pursuant to Section 2.01.
"Business Day" means any day other than a Saturday, Sunday or other day
on which commercial banks are authorized to close under the Laws of, or are in
fact closed in, the state where the Administrative Agent's Office is located
and, if such day relates to any Eurodollar
3
Rate Loan, means any such day on which dealings in Dollar deposits are conducted
by and between banks in the London interbank eurodollar market.
"Capitalization" means, as of any date of determination, an amount
equal to the sum of:
(a) Indebtedness as of such date (other than Receivables Financing
Indebtedness and other than Permitted Preferred Trust Securities) of the
Borrower and its Subsidiaries; minus
(b) an amount equal to (a) the Indebtedness as of such date of each
Subsidiary that is not a Wholly-Owned Subsidiary and whose Indebtedness is not
guaranteed by the Borrower or any Subsidiary multiplied by (b) a fraction, the
denominator of which is the number of shares of outstanding capital stock of
such Subsidiary and the numerator of which is the number of shares of capital
stock of such Subsidiary not held by the Borrower or another Subsidiary; plus
(c) Net Worth. For purposes of calculating the Capitalization Ratio as
of any date which is not the last day of a Fiscal Quarter, Net Worth shall be
calculated as of the last day of the most recent Fiscal Quarter.
"Capitalization Ratio" means, as of any date of determination, the
ratio of Indebtedness (other than (i) Receivables Financing Indebtedness, (ii)
Permitted Preferred Trust Securities and (iii) Excluded Permitted Affiliate
Subordinated Indebtedness) of the Borrower and its Subsidiaries to
Capitalization; provided, however, there shall be excluded from Indebtedness an
amount equal to (a) the Indebtedness of each Subsidiary that is not a
Wholly-Owned Subsidiary and whose Indebtedness is not guaranteed by the Borrower
or any Subsidiary multiplied by (b) a fraction, the denominator of which is the
number of shares of outstanding capital stock of such Subsidiary and the
numerator of which is the number of shares of capital stock of such Subsidiary
not held by the Borrower or another Subsidiary.
"CARCO" means CITCO Asphalt Refining Company, a New Jersey general
partnership.
"CERCLA" means the Comprehensive Environmental Response Compensation
and Liability Act of 1980 (42 U.S.C. Section 9601 et seq.).
"Change of Control" means any condition or occurrence such that less
than 50% of the Voting Stock of the Borrower shall be owned, directly or
indirectly, by PDVSA.
"CIC" means CITGO Investment Company, a Delaware corporation.
"Closing Date" means the first date all the conditions precedent in
Section 4.01 are satisfied or waived in accordance with Section 4.01 (or, in the
case of Section 4.01(c), waived by the Person entitled to receive the applicable
payment).
"Code" means the Internal Revenue Code of 1986.
"Commitment" means, as to each Lender, its obligation to (a) make Loans
to the Borrower pursuant to Section 2.01, in an aggregate principal amount at
any one time outstanding
4
not to exceed the amount set forth opposite such Lender's name on Schedule 2.01
or in the Assignment and Assumption pursuant to which such Lender becomes a
party hereto, as applicable, as such amount may be adjusted from time to time in
accordance with this Agreement.
"Compliance Certificate" means a certificate substantially in the form
of Exhibit C.
"Computation Period" shall mean, when used in the Compliance
Certificate or in Section 7.02(b) with reference to the calculation as of the
last day of the Fiscal Quarter, the 12-month period ending on that date.
"Contractual Obligation" means, as to any Person, any provision of any
security issued by such Person or of any agreement, instrument or other
undertaking to which such Person is a party or by which it or any of its
property is bound.
"Control" has the meaning specified in the definition of "Affiliate."
"CPIC" means CITGO Pipeline Investment Company, a Delaware corporation.
"CRCCLP" means CITGO Refining and Chemicals Company, L.P., a Delaware
limited partnership, formerly known as CITGO Refining and Chemicals, Inc., the
partners in which are CIC and the Borrower.
"CRCCLP Crude Supply Agreement" means that certain Crude Oil and
Feedstock Supply Agreement, dated as of March 31, 1987, by and between CRCCLP
and Petroleos.
"Crude Supply Agreement" means that certain Crude Supply Agreement,
dated as of September 30, 1986, by and between the Borrower and Petroleos.
"Debtor Relief Laws" means the Bankruptcy Code of the United States,
and all other liquidation, conservatorship, bankruptcy, assignment for the
benefit of creditors, moratorium, rearrangement, receivership, insolvency,
reorganization, or similar debtor relief Laws of the United States or other
applicable jurisdictions from time to time in effect and affecting the rights of
creditors generally.
"Default" means any event or condition that, with the giving of any
notice, the passage of time, or both, would (if not cured or otherwise remedied
during such time) be an Event of Default.
"Default Rate" means an interest rate equal to (a) the Base Rate plus
(b) the Applicable Rate, if any, applicable to Base Rate Loans plus (c) 2% per
annum; provided, however, that with respect to a Eurodollar Rate Loan, the
Default Rate shall be an interest rate equal to the interest rate (including any
Applicable Rate) otherwise applicable to such Loan plus 2% per annum, in each
case to the fullest extent permitted by applicable Laws.
5
"Defaulting Lender" means any Lender that (a) has failed to fund any
portion of the Loans required to be funded by it hereunder within one Business
Day of the date required to be funded by it hereunder, (b) has otherwise failed
to pay over to the Administrative Agent or any other Lender any other amount
required to be paid by it hereunder within one Business Day of the date when
due, unless the subject of a good faith dispute, or (c) has been deemed
insolvent or become the subject of a bankruptcy or Insolvency Proceeding.
"Disposition" has the meaning set forth in Section 7.01(b)(v).
"Dollar" and "$" mean lawful money of the United States.
"Domestic" entity means any entity that is organized under the laws of
any political subdivision of the United States.
"EBITDA" means, for any period, an amount equal to the sum of: (a) Net
Income of the Borrower and its Subsidiaries on a consolidated basis for such
period; plus (b) the aggregate amount of Interest Expense of the Borrower and
its Subsidiaries that was deducted for such period in determining such Net
Income; plus (c) the aggregate amount that was deducted in respect of Federal,
state and local income taxes of the Borrower and its Subsidiaries for such
period in determining Net Income, plus (d) the aggregate amount which was
deducted in respect of depreciation and amortization in determining Net Income
for such period.
"Eligible Assignee" has the meaning specified in Section 10.07(g).
"Environmental Laws" means any and all Federal, state, local, and
foreign statutes, laws, regulations, ordinances, rules, judgments, orders,
decrees, permits, concessions, grants, franchises, licenses, agreements or
governmental restrictions relating to pollution and the protection of the
environment or the release of any materials into the environment, including
those related to hazardous substances or wastes, air emissions and discharges to
waste or public systems.
"Environmental Liability" means any liability, contingent or otherwise
(including any liability for damages, costs of environmental remediation, fines,
penalties or indemnities), of the Borrower, or any of its Subsidiaries directly
or indirectly resulting from or based upon (a) violation of any Environmental
Law, (b) the generation, use, handling, transportation, storage, treatment or
disposal of any Hazardous Materials, (c) exposure to any Hazardous Materials,
(d) the release or threatened release of any Hazardous Materials into the
environment or (e) any contract, agreement or other consensual arrangement
pursuant to which liability is assumed or imposed with respect to any of the
foregoing.
"ERISA" means the Employee Retirement Income Security Act of 1974.
"Eurodollar Rate" means for any Interest Period with respect to any
Eurodollar Rate Loan:
6
(a) the rate per annum equal to the rate determined by the
Administrative Agent to be the offered rate that appears on the page of
the Telerate screen (or any successor thereto) that displays an average
British Bankers Association Interest Settlement Rate for deposits in
Dollars (for delivery on the first day of such Interest Period) with a
term equivalent to such Interest Period, determined as of approximately
11:00 a.m. (London time) two Business Days prior to the first day of
such Interest Period, or
(b) if the rate referenced in the preceding clause (a) does
not appear on such page or service or such page or service shall not be
available, the rate per annum equal to the rate determined by the
Administrative Agent to be the offered rate on such other page or other
service that displays an average British Bankers Association Interest
Settlement Rate for deposits in Dollars (for delivery on the first day
of such Interest Period) with a term equivalent to such Interest
Period, determined as of approximately 11:00 a.m. (London time) two
Business Days prior to the first day of such Interest Period, or
(c) if the rates referenced in the preceding clauses (a) and
(b) are not available, the rate per annum determined by the
Administrative Agent as the rate of interest at which deposits in
Dollars for delivery on the first day of such Interest Period in same
day funds in the approximate amount of the Eurodollar Rate Loan being
made, continued or converted by Bank of America and with a term
equivalent to such Interest Period would be offered by Bank of
America's London Branch to major banks in the London interbank
eurodollar market at their request at approximately 4:00 p.m. (London
time) two Business Days prior to the first day of such Interest Period.
"Eurodollar Rate Loan" means a Loan that bears interest at a rate based
on the Eurodollar Rate.
"Event of Default" has the meaning specified in Section 8.01.
"Excluded Permitted Affiliate Subordinated Indebtedness" means
Permitted Affiliate Subordinated Indebtedness in a principal amount not to
exceed $200,000,000.
"Existing Credit Agreements" mean that certain Amended and Restated
Credit Agreement dated as of May 7, 2002, and that certain $400,000,000 Credit
Agreement dated as of May 13, 1998 as amended, each among the Borrower, Bank of
America, as agent, and a syndicate of lenders.
"Federal Funds Rate" means, for any day, the rate per annum equal to
the weighted average of the rates on overnight Federal funds transactions with
members of the Federal Reserve System arranged by Federal funds brokers on such
day, as published by the Federal Reserve Bank on the Business Day next
succeeding such day; provided that (a) if such day is not a Business Day, the
Federal Funds Rate for such day shall be such rate on such transactions on the
next preceding Business Day as so published on the next succeeding Business Day,
and (b) if no such rate is so published on such next succeeding Business Day,
the Federal Funds Rate for such day shall be the average rate (rounded upward,
if necessary, to a whole multiple of 1/100 of
7
1%) charged to Bank of America on such day on such transactions as determined by
the Administrative Agent.
"Fee Letter" means the letter agreement, dated October 29, 2002, among
the Borrower, the Administrative Agent and the Arrangers.
"Fiscal Quarter" means each fiscal quarter of the Borrower and its
Subsidiaries.
"Fiscal Year" means each fiscal year of the Borrower and its
Subsidiaries.
"Foreign Lender" has the meaning specified in Section 10.15(a)(i).
"FRB" means the Board of Governors of the Federal Reserve System of the
United States.
"GAAP" means generally accepted accounting principles in the United
States set forth in the opinions and pronouncements of the Accounting Principles
Board and the American Institute of Certified Public Accountants and statements
and pronouncements of the Financial Accounting Standards Board or such other
principles as may be approved by a significant segment of the accounting
profession in the United States, that are applicable to the circumstances as of
the date of determination, consistently applied.
"Governmental Authority" means any nation or government, any state or
other political subdivision thereof, any agency, authority, instrumentality,
regulatory body, court, administrative tribunal, central bank or other entity
exercising executive, legislative, judicial, taxing, regulatory or
administrative powers or functions of or pertaining to government.
"Granting Lender" has the meaning specified in Section 10.07(h).
"Guarantee" means, as to any Person, (a) any obligation, contingent or
otherwise, of such Person guaranteeing or having the economic effect of
guaranteeing any Indebtedness or other monetary obligation payable by another
Person (the "primary obligor") in any manner, whether directly or indirectly,
and including any monetary obligation of such Person, direct or indirect, (i) to
purchase or pay (or advance or supply funds for the purchase or payment of) such
Indebtedness or other monetary obligation, (ii) to purchase or lease property,
securities or services for the purpose of assuring the obligee in respect of
such Indebtedness or other monetary obligation of the payment or performance of
such Indebtedness or other monetary obligation, (iii) to maintain working
capital, equity capital or any other financial statement condition or liquidity
or level of income or cash flow of the primary obligor so as to enable the
primary obligor to pay such Indebtedness or other monetary obligation, or (iv)
entered into for the purpose of assuring in any other manner the obligee in
respect of such Indebtedness or other monetary obligation of the payment or
performance thereof or to protect such obligee against loss in respect thereof
(in whole or in part), or (b) any Lien on any assets of such Person securing any
Indebtedness or other monetary obligation of any other Person, whether or not
such Indebtedness or other monetary obligation is assumed by such Person. The
amount of any Guarantee shall be deemed to be an amount equal to the stated or
determinable amount of the
8
related primary monetary obligation, or portion thereof, in respect of which
such Guarantee is made or, if not stated or determinable, the maximum reasonably
anticipated liability in respect thereof as determined by the guaranteeing
Person in good faith. The term "Guarantee" as a verb has a corresponding
meaning.
"Hazardous Materials" means all explosive or radioactive substances or
wastes and all hazardous or toxic substances, wastes or other pollutants,
including petroleum or petroleum distillates, asbestos or asbestos-containing
materials, polychlorinated biphenyls, radon gas, and all other substances or
wastes of any nature regulated pursuant to any Environmental Law.
"Impermissible Qualification" means, relative to any opinion by
independent public accountants as to any financial statement of the Borrower or
any of its Subsidiaries or of the Borrower and any of its Subsidiaries, any
qualification or exception to such opinion:
(a) which is of a "going concern" or a similar nature;
(b) which relates to the limited scope of examination of matters
relevant to such financial statement (other than scope limitations included in
the standard form of opinion utilized by such accountants); or
(c) which relates to the treatment or classification of any item in
such financial statement and which, as a condition to its removal, would require
adjustment to such item the effect of which would be to cause the Borrower to be
in default of any of its obligations under Section 7.02.
"Indebtedness" with respect to any Person means, without duplication,
(a) all of the following, whether or not included as indebtedness or liabilities
in accordance with GAAP: (i) all indebtedness for borrowed money of such Person
or for the deferred purchase price of property acquired by, or services rendered
to, such Person, (ii) all indebtedness of such Person created or arising under
any conditional sale or other title retention agreement with respect to any
property acquired by such Person, (iii) all indebtedness for borrowed money or
for the deferred purchase price of property or services secured by any Lien upon
or in any property owned by such Person whether or not such Person has assumed
or become liable for the payment of such indebtedness for borrowed money, and
(iv) at all times such liability is interest bearing, any finally assessed
withdrawal liability of such Person or a commonly enrolled entity to a
Multiemployer Plan; (b) the present value determined in accordance with GAAP of
all obligations of such Person under leases that are recorded as capitalized
leases; (c) indebtedness arising under acceptance facilities, any surety bond as
to which such Person is liable for reimbursement and the undrawn maximum face
amount of all outstanding letters of credit issued for the account of such
Person (except to the extent such letters of credit are issued to secure the
payment by such Person of obligations for Indebtedness otherwise included
herein) and, without duplication, the outstanding amount of all drafts drawn
thereunder; (d) all Off-Balance Sheet Liabilities; and to the extent not
included in clauses (a) through (d) above, all direct or indirect Guarantees by
such Person of Indebtedness described in this definition of any other Person;
provided, that, for purposes of this definition, the following shall not be
included as Indebtedness: (A) trade payables incurred within the ordinary course
of business and payable
9
within 90 days of the incurrence thereof; (B) Indebtedness of the Borrower owed
to Wholly-Owned Subsidiaries of the Borrower, provided that such Indebtedness is
subordinated to the Obligations in accordance with Section 7.01(e); or (C)
Indebtedness of a Wholly-Owned Subsidiary owed to the Borrower or a Wholly-Owned
Subsidiary.
For all purposes hereof, the Indebtedness of any Person shall include
the Indebtedness of any partnership or joint venture (other than a joint venture
that is itself a corporation or limited liability company) in which such Person
is a general partner or a joint venturer (for purposes of clarity, it is agreed
that "joint venturer" does not include a limited partner of a limited
partnership), unless such Indebtedness is expressly made non-recourse to such
Person.
"Indemnified Liabilities" has the meaning set forth in Section 10.05.
"Indemnitees" has the meaning set forth in Section 10.05.
"Insolvency Proceeding" means (a) any case, action or proceeding before
any court or other Governmental Authority relating to bankruptcy,
reorganization, insolvency, liquidation, receivership, dissolution, winding-up
or relief of debtors, or (b) any general assignment for the benefit of
creditors, composition, marshalling of assets for creditors, or other, similar
arrangement in respect of its creditors generally or any substantial portion of
its creditors; undertaken under U.S. Federal, state or foreign law, including
the Bankruptcy Code.
"Interest Expense" means, without duplication, for any period, the sum
of:
(i) aggregate interest expense of the Borrower and its Subsidiaries for
such period, as determined in accordance with GAAP and in any event including,
without duplication, all commissions, discounts and other fees and charges owed
with respect to letters of credit and banker's acceptances and net costs under
Interest Rate Swap Contracts and the portion of any obligation under capitalized
leases allocable to interest expense;
plus
(ii) interest expense of the Borrower and its Subsidiaries capitalized
during such period;
minus
(iii) amortization of capitalized interest expense of the Borrower and
its Subsidiaries for such period.
"Interest Payment Date" means, (a) as to any Loan other than a Base
Rate Loan, the last day of each Interest Period applicable to such Loan and the
Maturity Date; provided, however, that if any Interest Period for a Eurodollar
Rate Loan exceeds three months, the respective dates that fall every three
months after the beginning of such Interest Period shall also be Interest
Payment Dates; and (b) as to any Base Rate Loan , the last Business Day of each
March, June, September and December and the Maturity Date.
10
"Interest Period" means, as to each Eurodollar Rate Loan, the period
commencing on the date such Eurodollar Rate Loan is disbursed or converted to or
continued as a Eurodollar Rate Loan and ending on the date seven days, fourteen
days, or one, two, three, or six months thereafter, as selected by the Borrower
in its Loan Notice, or such other period that is twelve months or less requested
by the Borrower and consented to by all the Lenders; provided that:
(i) any Interest Period that would otherwise end on a day that
is not a Business Day shall be extended to the next succeeding Business
Day unless such Business Day falls in another calendar month, in which
case such Interest Period shall end on the next preceding Business Day;
(ii) any Interest Period that begins on the last Business Day
of a calendar month (or on a day for which there is no numerically
corresponding day in the calendar month at the end of such Interest
Period) shall end on the last Business Day of the calendar month at the
end of such Interest Period; and
(iii) no Interest Period shall extend beyond the Maturity
Date.
"Interest Rate Swap Contract" has the meaning set forth in the
definition of "Swap Contract."
"Investment" means, as to any Person, any direct or indirect
acquisition or investment by such Person, whether by means of (a) the purchase
or other acquisition of capital stock or other securities of another Person, (b)
a loan, advance or capital contribution to, Guarantee or assumption of debt of,
or purchase or other acquisition of any other debt or equity participation or
interest in, another Person, including any partnership or joint venture interest
in such other Person, or (c) the purchase or other acquisition (in one
transaction or a series of transactions) of assets of another Person that
constitute a business unit. For purposes of covenant compliance, the amount of
any Investment shall be the amount actually invested, without adjustment for
subsequent increases or decreases in the value of such Investment.
"IRS" means the United States Internal Revenue Service.
"Key Contracts" means the Crude Supply Agreement, the Supplemental
Crude Supply Agreement and the CRCCLP Crude Supply Agreement.
"Laws" means, collectively, all international, foreign, Federal, state
and local statutes, treaties, rules, guidelines, regulations, ordinances, codes
and administrative or judicial precedents or authorities, including the
interpretation or administration thereof by any Governmental Authority charged
with the enforcement, interpretation or administration thereof, and all
applicable administrative orders, directed duties, requests, licenses,
authorizations and permits of, and agreements with, any Governmental Authority,
in each case whether or not having the force of law.
"LCR" means Lyondell-CITGO Refining LP, a Delaware limited partnership.
11
"Lender" has the meaning specified in the introductory paragraph
hereto.
"Lending Office" means, as to any Lender, the office or offices of such
Lender described as such in such Lender's Administrative Questionnaire, or such
other office or offices as a Lender may from time to time notify the Borrower
and the Administrative Agent.
"Lien" means any mortgage, pledge, hypothecation, assignment, deposit
arrangement, encumbrance, lien (statutory or other), charge, or preference,
priority or other security interest or preferential arrangement of any kind or
nature whatsoever (including any conditional sale or other title retention
agreement, and any financing lease having substantially the same economic effect
as any of the foregoing).
"Loan" means an extension of credit by a Lender to the Borrower under
Article II.
"Loan Documents" means this Agreement, each Note and the Fee Letter.
"Loan Notice" means a notice of (a) a Borrowing, (b) a conversion of
Loans from one Type to the other, or (c) a continuation of Eurodollar Rate
Loans, pursuant to Section 2.02(a), which, if in writing, shall be substantially
in the form of Exhibit A.
"Margin Stock" means "margin stock" as such term is defined in
Regulation T, U or X of the FRB.
"Material Acquisition" means any acquisition where either the purchase
price or the book value of the assets acquired equals or exceeds the greater of
(a) $300,000,000 and (b) 5% of Capitalization.
"Material Adverse Effect" means (a) a material adverse change in, or a
material adverse effect upon, the operations, business, properties, liabilities
(actual or contingent) or condition (financial or otherwise) of the Borrower and
its Subsidiaries taken as a whole, taking into account insurance coverage and
effective indemnification; (b) a material impairment of the ability of the
Borrower to perform its payment or other material obligations under any Loan
Document to which it is a party; or (c) a material adverse effect upon the
legality, validity, binding effect or enforceability against the Borrower of any
Loan Document to which it is a party.
"Material Debt" means Indebtedness, Guarantees or Swap Contract
Obligations of any one or more of the Borrower and its Subsidiaries (except for
Indebtedness of any Subsidiary to the Borrower or to any Wholly-Owned
Subsidiary) having an aggregate principal amount (including undrawn committed or
available amounts and including amounts owing to all creditors under any
syndicated credit arrangement) of more than $35,000,000.
"Maturity Date" means the (a) later of (i) the Stated Maturity Date,
and (ii) if the Borrower exercises the Term-Out option pursuant to Section 2.13,
the Term Loan Maturity Date,
12
or, (b) if earlier, the effective date of any other termination, cancellation,
or acceleration of all Commitments under this Agreement.
"Moody's" means Xxxxx'x Investors Service, Inc. and any successor
thereto.
"Multiemployer Plan" means any "multiemployer plan" (as that term is
defined under section 3(37) of ERISA) under which the Borrower or any Related
Person has contributed or with respect to which the Borrower or such Related
Person may have any liability.
"Net Income" means, for any period, for the Borrower and its
Subsidiaries on a consolidated basis, the net income of the Borrower and its
Subsidiaries for the period, calculated without giving effect to extraordinary
gains and extraordinary losses. For the avoidance of doubt, net income means net
income before any adjustments for comprehensive income or comprehensive loss.
"Net Worth" means, as of any date of determination, Shareholder's
Equity of the Borrower and its Subsidiaries on a consolidated basis determined
in accordance with GAAP.
"Note" means a promissory note made by the Borrower in favor of a
Lender evidencing Loans made by such Lender, substantially in the form of
Exhibit B.
"Obligations" means all advances to, and debts, liabilities,
obligations, covenants and duties of, the Borrower arising under any Loan
Document or otherwise with respect to any Loan, whether direct or indirect
(including those acquired by assumption), absolute or contingent, due or to
become due, now existing or hereafter arising and including interest and fees
that accrue after the commencement by or against the Borrower or any Affiliate
thereof of any proceeding under any Debtor Relief Laws naming such Person as the
debtor in such proceeding, regardless of whether such interest and fees are
allowed claims in such proceeding.
"Off-Balance Sheet Liabilities" means, with respect to any Person as of
any date of determination thereof, without duplication: (a) with respect to any
asset securitization transaction (including any Receivables Purchase Facility)
(i) the unrecovered investment of the purchasers (or the transferees) of the
assets transferred pursuant to such transaction, and (ii) any other payment,
recourse, repurchase, hold harmless, indemnity or similar obligation of such
Person or any of its Subsidiaries in respect of assets transferred or payments
made in respect thereof, other than limited recourse provisions that are
customary for transactions of such type and that neither (x) have the effect of
limiting the loss or credit risk of such purchasers or transferees with respect
to payment or performance by the obligors of the assets so transferred nor (y)
impair the characterization of the transaction as a true sale under applicable
Laws (including Debtor Relief Laws); (b) the monetary obligations under any
Synthetic Lease or financing lease which, upon the application of any Debtor
Relief Law to such Person or any of its Subsidiaries, would be characterized by
a court of competent jurisdiction as indebtedness; (c) the monetary obligations
under any Sale Leaseback Transaction which does not create a liability
classified as Indebtedness; or (d) any other monetary obligation arising with
respect to any other transaction which (i) upon the application of any Debtor
Relief Law to such Person or any of its
13
Subsidiaries, would be characterized by a court of competent jurisdiction as
indebtedness or (ii) is the functional equivalent of or takes the place of
borrowing but which does not constitute Indebtedness (for purposes of this
clause (d), any transaction structured to provide tax deductibility as interest
expense of any dividend, coupon or other periodic payment will be deemed to be
the functional equivalent of a borrowing). The amount of any Synthetic Lease
obligation as of any date shall be deemed to be the amount of Attributable
Indebtedness in respect thereof as of such date.
"Organization Documents" means, (a) with respect to any corporation,
the certificate or articles of incorporation and the bylaws (or equivalent or
comparable constitutive documents with respect to any non-U.S. jurisdiction);
(b) with respect to any limited liability company, the certificate or articles
of formation or organization and operating agreement; and (c) with respect to
any partnership, joint venture, trust or other form of business entity, the
partnership, joint venture or other applicable agreement of formation or
organization and any agreement, instrument, filing or notice with respect
thereto filed in connection with its formation or organization with the
applicable Governmental Authority in the jurisdiction of its formation or
organization and, if applicable, any certificate or articles of formation or
organization of such entity.
"Outstanding Amount" means, with respect to Loans on any date, the
aggregate outstanding principal amount thereof after giving effect to any
borrowings and prepayments or repayments of Loans occurring on such date.
"Participant" has the meaning specified in Section 10.07(d).
"Pass-Through Investment" means an Investment (a) which Investment is
made by the Borrower contemporaneously with the making of a capital contribution
in the Borrower by PDVSA or one of its Subsidiaries, which capital contribution
is in cash and is specified for the purpose of the making of such Investment,
and (b) which Investment shall be no greater than the amount of such capital
contribution.
"PBGC" means the Pension Benefit Guaranty Corporation, or any
Governmental Authority succeeding to any of its principal functions under ERISA.
"PDVMR" means PDV Midwest Refining, LLC, a Delaware limited liability
company.
"PDVSA" means Petroleos de Venezuela, S.A., a Venezuelan corporation.
"Permitted Affiliate Subordinated Indebtedness" means unsecured
Indebtedness owed by the Borrower to an Affiliate of the Borrower, subordinated
to the Obligations and any refinancing thereof pursuant to subordination terms
satisfactory to the Administrative Agent, provided that such Indebtedness (i)
shall not bear a rate of interest that is greater than a market rate of
interest, and (ii) shall not require any principal payment (whether pursuant to
an amortization schedule, maturity, or otherwise) earlier than one year after
the Maturity Date.
"Permitted Liens" has the meaning specified in subsection 7.01(a).
14
"Permitted Preferred Trust Securities" means any securities made up of
trust participation interests, or of limited partnership interests, issued by a
Subsidiary of the Borrower; provided that:
(a) the issuer of such securities has no assets other than Permitted
Subordinated Trust Indebtedness owing to it by the Borrower.
(b) payments upon such securities can be made only out of funds
received in payment of such Permitted Subordinated Trust Indebtedness;
(c) so long as no default has occurred and is continuing under the
indenture or related documents executed in connection with the issuance of such
securities, at the election of the Borrower (acting either directly or through
such issuer), all payments upon such securities can be deferred for the greater
of (i) one or more payment periods, and (ii) a period expiring not earlier than
20 years after the Maturity Date; and
(d) such securities shall not be subject to mandatory redemption or
redemption at the option of the holder thereof at a time that is earlier than 20
years after the Maturity Date.
"Permitted Subordinated Trust Indebtedness" means (a) any promissory
notes or debentures issued by the Borrower to any issuer of Permitted Preferred
Trust Securities, provided that such notes or debentures (i) are subordinated to
the Obligations pursuant to subordination terms satisfactory to the
Administrative Agent, (ii) do not require any principal payments to be made at a
time that is earlier than 20 years after the Maturity Date, (iii) provide that
so long as no default has occurred and is continuing thereunder or under the
indenture or related documents executed in connection therewith, at the election
of the Borrower, all payments upon such notes or debentures can be deferred for
the greater of (A) one or more payment periods, and (B) a period expiring not
earlier than 20 years after the Maturity Date, and (iv) have a maturity date
that is not earlier than 20 years after the Maturity Date, and (b) any guaranty
by the Borrower that the issuer of such Permitted Preferred Trust Securities
will make required distributions thereon to the extent it has funds available
therefore, provided that such guaranty is subordinated to the Obligations
pursuant to subordination terms satisfactory to the Administrative Agent.
"Person" means any natural person, corporation, limited liability
company, trust, joint venture, association, company, partnership, Governmental
Authority or other entity.
"Petroleos" means PDVSA Petroleo, S.A., a Venezuelan corporation.
"Plan" means any plan described in section 4021(a) of ERISA and not
excluded pursuant to section 4021(b) thereof, under which the Borrower or any
Related Person to the Borrower has contributed or with respect to which the
Borrower or such Related Person is liable.
"Principal Properties" means (a) (i) the Borrower's refinery located at
Lake Charles Louisiana, (ii) CRCCLP's refinery located at Corpus Christi, Texas
and (iii) PDVMR's refinery
15
located at Lemont, Illinois, and (b) any refinery property acquired by the
Borrower or a Subsidiary in replacement of, or swap for, any of the foregoing
properties.
"Principal Subsidiary" means CARCO, CPIC, CRCCLP, CIC, PDVMR or any
other Subsidiary whose assets have an aggregate book value exceeding
$100,000,000.
"Private Placement Agreement" means that certain Note Purchase
Agreement dated as of November 1, 1991 among the Borrower and each of the
purchasers named therein relating to the Borrower's issuance, and such
purchasers' purchase, of the Private Placement Notes.
"Private Placement Notes" means the senior notes issued by the Borrower
pursuant to the Private Placement Agreement, consisting of an issue of
$125,000,000 aggregate principal amount of the Borrower's 9.30% Guaranteed
Series C Senior Notes due 2006.
"Pro Rata Share" means, with respect to each Lender at any time, a
fraction (expressed as a percentage, carried out to the ninth decimal place),
the numerator of which is the amount of the Commitment of such Lender at such
time and the denominator of which is the amount of the Aggregate Commitments at
such time; provided that if the commitment of each Lender to make Loans have
been terminated pursuant to Section 8.02, then the Pro Rata Share of each Lender
shall be determined based on the Pro Rata Share of such Lender immediately prior
to such termination and after giving effect to any subsequent assignments made
pursuant to the terms hereof. The initial Pro Rata Share of each Lender is set
forth opposite the name of such Lender on Schedule 2.01 or in the Assignment and
Assumption pursuant to which such Lender becomes a party hereto, as applicable.
"Project Financing" means Indebtedness incurred to finance the
acquisition or construction of a project, provided that no portion of such
Indebtedness permits or provides for recourse against the Borrower or any of its
Subsidiaries other than recourse to the equity interests in, or assets of, the
Project Financing/Special Purpose Subsidiary that is the owner of the project so
financed.
"Project Financing/Special Purpose Subsidiary" means a Subsidiary of
the Borrower whose principal purpose is to incur Project Financing, and the
assets of which Subsidiary are limited to those assets being financed in whole
or in part by a Project Financing.
"RCRA" means the Resource Conservation and Recovery Act of 1976 (42
U.S.C. Section 6901 et seq.)
"Receivable" of the Borrower or any Subsidiary means, as at any date of
determination thereof, the unpaid principal portion of the obligation, as stated
on the respective invoice, of any customer of the Borrower or such Subsidiary to
pay money to the Borrower or such Subsidiary in respect of any services
performed by the Borrower or such Subsidiary or inventory purchased from the
Borrower or such Subsidiary net of all credits, rebates and offsets owed to such
customer by the Borrower or such Subsidiary and also net of all commissions
payable by the Borrower or such Subsidiary to third parties (and for purposes
hereof, a credit or rebate paid by check or draft of the Borrower or such
Subsidiary shall be deemed to be outstanding until such
16
check or draft shall have been debited to the respective account of the Borrower
or the Subsidiary on which such check or draft was drawn).
"Receivables Financing Indebtedness" means obligations of the Borrower
and its Subsidiaries, with respect to Receivables Purchase Facilities which
obligations are included in the definition of Indebtedness.
"Receivables Purchase Facility" means, as to the Borrower or any
Subsidiary, any facility providing for the sale, transfer, conveyance, lease or
assignment, with or without recourse, of the Receivables of such Person.
"Register" has the meaning set forth in Section 10.07(c).
"Related Person" with respect to any Person means any other Person
which, together with such Person, is under common control as described in
Section 414 of the Code.
"Reportable Event" means, any of the events set forth in Section
4043(b) of ERISA or the regulations thereunder.
"Required Lenders" means, as of any date of determination, Lenders
having at least 66-2/3% of the Aggregate Commitments or, if the commitment of
each Lender to make Loans have been terminated pursuant to Section 8.02, Lenders
holding in the aggregate at least 66-2/3% of the Total Outstandings; provided
that the Commitment of, and the portion of the Total Outstandings held or deemed
held by, any Defaulting Lender shall be excluded for purposes of making a
determination of Required Lenders.
"Requirement of Law" means, as to any Person, any law, treaty, rule,
regulation, judgment or order of a Governmental Authority or other requirement
having the force of law, in each case applicable to or binding upon the Person
or any of its property or to which the Person or any of its property is subject
and any interpretation thereof by any Person having jurisdiction with respect
thereto or charged with the administration or interpretation thereof.
"Responsible Officer" means the chief executive officer, president,
chief financial officer, controller, treasurer or assistant treasurer of the
Borrower. Any document delivered hereunder that is signed by a Responsible
Officer of the Borrower shall be conclusively presumed to have been authorized
by all necessary corporate, partnership and/or other action on the part of the
Borrower and such Responsible Officer shall be conclusively presumed to have
acted on behalf of the Borrower.
"Revolver Loans" means Loans made during the Revolving Availability
Period.
"Revolving Availability Period" means the period from and including the
Closing Date to the earliest of (a) the Stated Maturity Date, (b) the date of
termination of the Aggregate Commitments pursuant to Section 2.04, and (c) the
date of termination of the Commitment of each Lender to make Loans pursuant to
Section 8.02.
17
"S&P" means Standard & Poor's Ratings Services, a division of The
XxXxxx-Xxxx Companies, Inc. and any successor thereto.
"Sale Leaseback Transaction" means a transaction or series of
transactions pursuant to which the Borrower or any Subsidiary shall sell or
transfer to any Person (other than the Borrower or a Subsidiary) any Principal
Property, whether now owned or hereafter acquired, and, as part of the same
transaction or series of transactions, the Borrower or such Subsidiary shall
rent or lease as lessee (other than pursuant to a capital lease), or similarly
acquire the right to possession or use of, such Principal Property.
"SEC" means the Securities and Exchange Commission, or any Governmental
Authority succeeding to any of its principal functions.
"Senior Notes" means the Borrower's outstanding $200,000,000 aggregate
principal amount 7-7/8% Senior Notes due 2006 and any other notes now or
hereafter issued under the Borrower's Indenture dated as of May 1, 1996 between
the Borrower and Bank One, N.A., as Trustee.
"Shareholder's Equity" means, as of any date of determination, (a)
consolidated shareholder's equity of the Borrower and its Subsidiaries as of
that date determined in accordance with GAAP, plus (b) Permitted Preferred Trust
Securities.
"Short-Term Marketable Debt Securities" means a security of a domestic
issuer with a maturity of one year or less and a debt rating of A-1 or better by
S&P and P-1 or better by Xxxxx'x.
"SPC" has the meaning specified in Section 10.07(h).
"Stated Maturity Date" means the later of (a) December 10, 2003, and
(b) if the maturity is extended pursuant to Section 2.12, such extended maturity
date as determined pursuant to such Section.
"Subsidiary" of a Person means a corporation, partnership, joint
venture, limited liability company or other business entity of which a majority
of the shares of securities or other interests having ordinary voting power for
the election of directors or other governing body (other than securities or
interests having such power only by reason of the happening of a contingency)
are at the time beneficially owned directly, or indirectly through one or more
intermediaries, or both, by such Person. Unless otherwise specified, all
references herein to a "Subsidiary" or to "Subsidiaries" shall refer to a
Subsidiary or Subsidiaries of the Borrower.
"Supplemental Crude Supply Agreement" means that certain Supplemental
Crude Supply Agreement, dated as of September 30, 1986, by and between the
Borrower and Petroleos.
"Swap Contract" means (a) any and all rate swap transactions, basis
swaps, credit derivative transactions, forward rate transactions, commodity
swaps, commodity options, forward commodity contracts, equity or equity index
swaps or options, bond or bond price or
18
bond index swaps or options or forward bond or forward bond price or forward
bond index transactions, interest rate options, forward foreign exchange
transactions, cap transactions, floor transactions, collar transactions,
currency swap transactions, cross-currency rate swap transactions, currency
options, spot contracts, or any other similar transactions or any combination of
any of the foregoing (including any options to enter into any of the foregoing),
whether or not any such transaction is governed by or subject to any master
agreement, and (b) any and all transactions of any kind, and the related
confirmations, which are subject to the terms and conditions of, or governed by,
any form of master agreement published by the International Swaps and
Derivatives Association, Inc., any International Foreign Exchange Master
Agreement, or any other master agreement (any such master agreement, together
with any related schedules, a "Master Agreement"), including any such
obligations or liabilities under any Master Agreement. "Interest Rate Swap
Contracts" means any of the foregoing relating to interest rates.
"Swap Contract Obligations" means Obligations in respect of Swap
Contracts. For purposes of Section 8.01(e), the term "principal amount" of Swap
Contract Obligations of the Borrower or a Subsidiary at any time shall be the
maximum aggregate amount (giving effect to any netting agreements) that the
Borrower or such Subsidiary would be required to pay if such Swap Contract were
terminated at such time.
"Synthetic Lease" of the Borrower or a Subsidiary of the Borrower means
(a) a lease designed to have the characteristics of a loan for federal income
tax purposes while obtaining operating lease treatment for financial accounting
purposes, or (b) an agreement for the use or possession of property creating
obligations that do not appear on the balance sheet of the Borrower and its
Subsidiaries but which, upon the insolvency or bankruptcy of the Borrower or a
Subsidiary of the Borrower, would be characterized by a court of competent
jurisdiction as the indebtedness of the Borrower or a Subsidiary of the Borrower
(without regard to accounting treatment).
"Term Loan" shall mean the term loan made pursuant to Section 2.13.
"Term Loan Maturity Date" shall mean the earlier of (a) the date that
is one year after the Stated Maturity Date, and (b) the Maturity Date as defined
in the Three-Year Credit Agreement.
"Term-Out" has the meaning specified in Section 2.13(a).
"Three-Year Credit Agreement" means that certain $250,000,000
Three-Year Credit Agreement dated as of even date hereof, among the parties
hereto.
"Total Outstandings" means the aggregate Outstanding Amount of all
Loans.
"Type" means, with respect to a Loan, its character as a Base Rate Loan
or a Eurodollar Rate Loan.
"Unfunded Vested Liability" means, relative to any Plan, including any
Multiemployer Plan, at any time, the excess (if any) of (a) the present value of
all vested nonforfeitable benefits under such Plan or such Multiemployer Plan,
as the case may be, over (b) the fair market value
19
of all Plan assets or Multiemployer Plan assets, as the case may be, allocable
to such benefits, all determined as of the then most recent valuation date for
such Plan or such Multiemployer Plan, as the case may be, but only to the extent
that such excess represents a potential liability of the Borrower to the PBGC,
such Plan or such Multiemployer Plan under Title IV of ERISA.
"United States" and "U.S." mean the United States of America.
"Unreimbursed Amount" has the meaning set forth in Section 2.04(c)(i).
"Voting Stock" means, with respect to any corporation, any class of
shares of stock of such corporation having general voting power under ordinary
circumstances to elect a majority of the board of directors of such corporation
(irrespective of whether or not at the time stock of any other class or classes
of such corporation shall have or might have voting power by reason of the
happening of any contingency).
"Welfare Plan" means a "welfare plan" as such term is defined in
section 3(1) of ERISA.
"Wholly-Owned" means, with respect to any Subsidiary that, except for
directors' qualifying shares required by law, 100% of the capital stock of such
Subsidiary of each class having ordinary voting power, and 100% of the capital
stock of such Subsidiary of every other class, in each case, at the time as of
which any determination is being made, is owned, beneficially and of record, by
the Borrower, or by one or more of the other Wholly-Owned Subsidiaries, or both.
1.02 OTHER INTERPRETIVE PROVISIONS. With reference to this Agreement
and each other Loan Document, unless otherwise specified herein or in such other
Loan Document:
(a) The meanings of defined terms are equally applicable to the
singular and plural forms of the defined terms.
(b) (i) The words "herein," "hereto," "hereof" and "hereunder" and
words of similar import when used in any Loan Document shall refer to such Loan
Document as a whole and not to any particular provision thereof.
(ii) Article, Section, Exhibit and Schedule references are to the
Loan Document in which such reference appears.
(iii) The term "including" is by way of example and not limitation.
(iv) The term "documents" includes any and all instruments,
documents, agreements, certificates, notices, reports, financial
statements and other writings, however evidenced, whether in physical
or electronic form.
(c) In the computation of periods of time from a specified date to a
later specified date, the word "from" means "from and including;" the words "to"
and "until" each mean "to but excluding;" and the word "through" means "to and
including."
20
(d) Section headings herein and in the other Loan Documents are
included for convenience of reference only and shall not affect the
interpretation of this Agreement or any other Loan Document.
1.03 ACCOUNTING TERMS. (a) All accounting terms not specifically or
completely defined herein shall be construed in conformity with, and all
financial data (including financial ratios and other financial calculations)
required to be submitted pursuant to this Agreement shall be prepared in
conformity with, GAAP applied on a consistent basis, as in effect from time to
time, applied in a manner consistent with that used in preparing the Audited
Financial Statements, except as otherwise specifically prescribed herein.
(b) If at any time any change in GAAP would affect the computation of
any financial ratio or requirement set forth in any Loan Document, and either
the Borrower or the Required Lenders shall so request, the Administrative Agent,
the Lenders 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 (subject to the approval of the Required Lenders); provided that, until
so amended, (i) such ratio or requirement shall continue to be computed in
accordance with GAAP prior to such change therein and (ii) the Borrower shall
provide to the Administrative Agent and the Lenders 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.
1.04 ROUNDING. Any financial ratios required to be maintained by the
Borrower pursuant to this Agreement shall be calculated by dividing the
appropriate component by the other component, carrying the result to one place
more than the number of places by which such ratio is expressed herein and
rounding the result up or down to the nearest number (with a rounding-up if
there is no nearest number).
1.05 REFERENCES TO AGREEMENTS AND LAWS. Unless otherwise expressly
provided herein, (a) references to Organization Documents, agreements (including
the Loan Documents) and other contractual instruments shall be deemed to include
all subsequent amendments, restatements, extensions, supplements and other
modifications thereto, but only to the extent that such amendments,
restatements, extensions, supplements and other modifications are not prohibited
by any Loan Document; and (b) references to any Law shall include all statutory
and regulatory provisions consolidating, amending, replacing, supplementing or
interpreting such Law.
1.06 TIMES OF DAY. Unless otherwise specified, all references herein to
times of day shall be references to Central time (daylight or standard, as
applicable).
ARTICLE II.
THE COMMITMENTS AND BORROWINGS
2.01 LOANS. Subject to the terms and conditions set forth herein, each
Lender severally agrees to make loans (each such loan, a "Loan") to the Borrower
from time to time, on
21
any Business Day during the Revolving Availability Period, in an aggregate
amount not to exceed at any time outstanding the amount of such Lender's
Commitment; provided, however, that after giving effect to any Borrowing, (i)
the Total Outstandings shall not exceed the Aggregate Commitments, and (ii) the
aggregate Outstanding Amount of the Loans of any Lender shall not exceed such
Lender's Commitment. Within the limits of each Lender's Commitment, and subject
to the other terms and conditions hereof, the Borrower may borrow under this
Section 2.01, prepay under Section 2.03, and reborrow under this Section 2.01.
Loans may be Base Rate Loans or Eurodollar Rate Loans, as further provided
herein.
2.02 BORROWINGS, CONVERSIONS AND CONTINUATIONS OF LOANS.
(a) Each Borrowing, each conversion of Loans from one Type to the
other, and each continuation of Eurodollar Rate Loans shall be made upon the
Borrower's irrevocable notice to the Administrative Agent, which may be given by
telephone. Each such notice must be received by the Administrative Agent not
later than 12:00 noon (i) three Business Days prior to the requested date of any
Borrowing of, conversion to or continuation of Eurodollar Rate Loans, and (ii)
on the requested date of any conversion of Eurodollar Rate Loans to Base Rate
Loans, or of any Borrowing of Base Rate Loans; provided, however, that if the
Borrower wishes to request Eurodollar Rate Loans having an Interest period other
than seven days, fourteen days, or one, two, three or six months in duration as
provided in the definition of "Interest Period", the applicable notice must be
received by the Administrative Agent not later than 12:00 noon four Business
Days prior to the requested date of such Borrowing, conversion or continuation,
whereupon the Administrative Agent shall give prompt notice to the Lenders of
such request and determine whether the requested Interest period is acceptable
to all of them. Not later than 12:00 noon, three Business Days before the
requested date of such Borrowing, conversion or continuation, the Administrative
Agent shall notify the Borrower (which notice may be by telephone) whether or
not the requested Interest Period has been consented to by all the Lenders..
Each telephonic notice by the Borrower pursuant to this Section 2.02(a) must be
confirmed promptly by delivery to the Administrative Agent of a written Loan
Notice, appropriately completed and signed by a Responsible Officer of the
Borrower. Each Borrowing of, conversion to or continuation of Eurodollar Rate
Loans shall be in a principal amount of $5,000,000 or a whole multiple of
$1,000,000 in excess thereof. Each Borrowing of or conversion to Base Rate Loans
shall be in a principal amount of $1,000,000 or a whole multiple of $500,000 in
excess thereof. Each Loan Notice (whether telephonic or written) shall specify
(i) whether the Borrower is requesting a Borrowing, a conversion of Loans from
one Type to the other, or a continuation of Eurodollar Rate Loans, (ii) the
requested date of the Borrowing, conversion or continuation, as the case may be
(which shall be a Business Day), (iii) the principal amount of Loans to be
borrowed, converted or continued, (iv) the Type of Loans to be borrowed or to
which existing Loans are to be converted, and (v) if applicable, the duration of
the Interest Period with respect thereto. If the Borrower fails to specify a
Type of Loan in a Loan Notice or if the Borrower fails to give a timely notice
requesting a conversion or continuation, then the applicable Loans shall be made
as, or converted to, Base Rate Loans. Any such automatic conversion to Base Rate
Loans shall be effective as of the last day of the Interest Period then in
effect with respect to the applicable Eurodollar Rate Loans. If the Borrower
requests a Borrowing of, conversion to, or continuation of Eurodollar Rate Loans
in any such Loan Notice,
22
but fails to specify an Interest Period, it will be deemed to have specified an
Interest Period of seven days.
(b) Following receipt of a Loan Notice, the Administrative Agent shall
promptly notify each Lender of the amount of its Pro Rata Share of the
applicable Loans, and if no timely notice of a conversion or continuation is
provided by the Borrower, the Administrative Agent shall notify each Lender of
the details of any automatic conversion to Base Rate Loans described in the
preceding subsection. In the case of a Borrowing during the Revolving
Availability Period, each Lender shall make the amount of its Loan available to
the Administrative Agent in immediately available funds at the Administrative
Agent's Office not later than 1:00 p.m. on the Business Day specified in the
applicable Loan Notice. Upon satisfaction of the applicable conditions set forth
in Section 4.02 (and, if such Borrowing is the initial Borrowing, Section 4.01),
the Administrative Agent shall make all funds so received available to the
Borrower in like funds as received by the Administrative Agent either by (i)
crediting the account of the Borrower on the books of Bank of America with the
amount of such funds or (ii) wire transfer of such funds, in each case in
accordance with instructions provided to (and reasonably acceptable to) the
Administrative Agent by the Borrower.
(c) Except as otherwise provided herein, a Eurodollar Rate Loan may be
continued or converted only on the last day of an Interest Period for such
Eurodollar Rate Loan. During the existence of a Default or an Event of Default,
no Loans may be requested as, converted to or continued as Eurodollar Rate Loans
without the consent of the Required Lenders.
(d) The Administrative Agent shall promptly notify the Borrower and the
Lenders of the interest rate applicable to any Interest Period for Eurodollar
Rate Loans upon determination of such interest rate. The determination of the
Eurodollar Rate by the Administrative Agent shall be conclusive in the absence
of manifest error. At any time that Base Rate Loans are outstanding, the
Administrative Agent shall notify the Borrower and the Lenders of any change in
Bank of America's prime rate used in determining the Base Rate promptly
following the public announcement of such change.
(e) After giving effect to all Borrowings, all conversions of Loans
from one Type to the other, and all continuations of Loans as the same Type,
there shall not be more than ten Interest Periods in effect with respect to
Loans.
2.03 PREPAYMENTS.
(a) The Borrower may, upon notice to the Administrative Agent, at any
time or from time to time voluntarily prepay Loans in whole or in part without
premium or penalty; provided that (i) such notice must be received by the
Administrative Agent not later than 12:00 noon (A) three Business Days prior to
any date of prepayment of Eurodollar Rate Loans and (B) on the date of
prepayment of Base Rate Loans; (ii) any prepayment of Eurodollar Rate Loans
shall be in a principal amount of $5,000,000 or a whole multiple of $1,000,000
in excess thereof; and (iii) any prepayment of Base Rate Loans shall be in a
principal amount of $1,000,000 or a whole multiple of $500,000 in excess thereof
or, in each case, if less, the entire principal amount thereof then outstanding.
Each such notice shall specify the date and amount of such prepayment
23
and the Type(s) of Loans to be prepaid. The Administrative Agent will promptly
notify each Lender of its receipt of each such notice, and of the amount of such
Lender's Pro Rata Share of such prepayment. If such notice is given by the
Borrower, the Borrower shall make such prepayment and the payment amount
specified in such notice shall be due and payable on the date specified therein.
Any prepayment of a Eurodollar Rate Loan shall be accompanied by all accrued
interest thereon, together with any additional amounts required pursuant to
Section 3.05. Each such prepayment shall be applied to the Loans of the Lenders
in accordance with their respective Pro Rata Shares.
(b) If for any reason the Total Outstandings at any time exceed the
Aggregate Commitments then in effect, the Borrower shall immediately prepay
Loans in an aggregate amount equal to such excess.
2.04 TERMINATION OR REDUCTION OF COMMITMENTS. The Borrower may, upon
notice to the Administrative Agent, terminate the Aggregate Commitments, or from
time to time permanently reduce the Aggregate Commitments; provided that (i) any
such notice shall be received by the Administrative Agent not later than 12:00
noon five Business Days prior to the date of termination or reduction, (ii) any
such partial reduction shall be in an aggregate amount of $5,000,000 or any
whole multiple of $1,000,000 in excess thereof, and (iii) the Borrower shall not
terminate or reduce the Aggregate Commitments if, after giving effect thereto
and to any concurrent prepayments hereunder, the Total Outstandings would exceed
the Aggregate Commitments. The Administrative Agent will promptly notify the
Lenders of any such notice of termination or reduction of the Aggregate
Commitments. Any reduction of the Aggregate Commitments shall be applied to the
Commitment of each Lender according to its Pro Rata Share. All facility and
utilization fees accrued until the effective date of any termination of the
Aggregate Commitments shall be paid on the effective date of such termination.
2.05 REPAYMENT OF LOANS.
The Borrower shall repay on the Maturity Date the aggregate principal
amount of Loans outstanding on such date. Payment shall be made to the
Administrative Agent for the account of the Lenders.
2.06 INTEREST.
(a) Subject to the provisions of subsection (b) below, (i) each
Eurodollar Rate Loan shall bear interest on the outstanding principal amount
thereof for each Interest Period at a rate per annum equal to the Eurodollar
Rate for such Interest Period plus the Applicable Rate; and (ii) each Base Rate
Loan shall bear interest on the outstanding principal amount thereof from the
applicable borrowing date at a rate per annum equal to the Base Rate plus the
Applicable Rate.
(b) If any amount payable by the Borrower under any Loan Document is
not paid when due (without regard to any applicable grace periods), whether at
stated maturity, by acceleration or otherwise, such amount shall thereafter bear
interest at a fluctuating interest rate per annum at all times equal to the
Default Rate to the fullest extent permitted by applicable Laws. In addition,
while any Event of Default exists, the Borrower shall pay interest on the
24
principal amount of all outstanding Obligations hereunder at a fluctuating
interest rate per annum at all times equal to the Default Rate to the fullest
extent permitted by applicable Laws. Accrued and unpaid interest on past due
amounts (including interest on past due interest) shall be due and payable upon
demand.
(c) Interest on each Loan shall be due and payable in arrears on each
Interest Payment Date applicable thereto and at such other times as may be
specified herein. Interest hereunder shall be due and payable in accordance with
the terms hereof before and after judgment, and before and after the
commencement of any proceeding under any Debtor Relief Law.
2.07 FEES.
(a) Facility Fee. The Borrower shall pay to the Administrative Agent
for the account of each Lender in accordance with its Pro Rata Share, a facility
fee equal to the Applicable Rate times the actual daily amount of the Aggregate
Commitments (or, if the Aggregate Commitments have terminated, on the
Outstanding Amount of all Loans), regardless of usage. The facility fee shall
accrue at all times during the Availability Period (and thereafter so long as
any Revolver Loans or Term Loans remain outstanding), including at any time
during which one or more of the conditions in Article IV is not met, and shall
be due and payable quarterly in arrears on the last Business Day of each March,
June, September and December, commencing with the first such date to occur after
the Closing Date, and on the Maturity Date (and, if applicable, thereafter on
demand). The facility fee shall be calculated quarterly in arrears, and if there
is any change in the Applicable Rate during any quarter, the actual daily amount
shall be computed and multiplied by the Applicable Rate separately for each
period during such quarter that such Applicable Rate was in effect.
(b) Utilization Fee. The Borrower shall pay to the Administrative Agent
for the account of each Lender in accordance with its Pro Rata Share, (i) at all
times, unless the Term Out option has been exercised pursuant to Section 2.13, a
utilization fee equal to the Applicable Rate times the Total Outstandings on
each day that the Total Outstandings exceed 33% of the actual daily amount of
the Aggregate Commitments, and (ii) from and after the effective date of the
exercise of the Term-Out option, a utilization fee equal to the Applicable Rate
times the Total Outstandings. The utilization fee shall be due and payable
quarterly in arrears on the last Business Day of each March, June, September and
December, commencing with the first such date to occur after the Closing Date,
and on the Maturity Date. The utilization fee shall be calculated quarterly in
arrears. The utilization fee shall accrue at all times, including at any time
during which one or more of the conditions in Article IV is not met.
(b) Other Fees. (i) The Borrower shall pay to the Arrangers and the
Administrative Agent for their own respective accounts fees in the amounts and
at the times specified in the Fee Letter. Such fees shall be fully earned when
paid and shall not be refundable for any reason whatsoever.
25
(ii) The Borrower shall pay to the Lenders such fees as shall have been
separately agreed upon in writing in the amounts and at the times so specified.
Such fees shall be fully earned when paid and shall not be refundable for any
reason whatsoever.
2.08 COMPUTATION OF INTEREST AND FEES. All computations of interest for
Base Rate Loans when the Base Rate is determined by Bank of America's "prime
rate" shall be made on the basis of a year of 365 or 366 days, as the case may
be, and actual days elapsed. All other computations of fees and interest shall
be made on the basis of a 360-day year and actual days elapsed (which results in
more fees or interest, as applicable, being paid than if computed on the basis
of a 365-day year). Interest shall accrue on each Loan for the day on which the
Loan is made, and shall not accrue on a Loan, or any portion thereof, for the
day on which the Loan or such portion is paid, provided that any Loan that is
repaid on the same day on which it is made shall, subject to Section 2.10(a),
bear interest for one day.
2.09 EVIDENCE OF DEBT.
The Loans made by each Lender shall be evidenced by one or more
accounts or records maintained by such Lender and by the Administrative Agent in
the ordinary course of business. The accounts or records maintained by the
Administrative Agent and each Lender shall be conclusive absent manifest error
of the amount of the Loans made by the Lenders to the Borrower and the interest
and payments thereon. Any failure to so record or any error in doing so shall
not, however, limit or otherwise affect the obligation of the Borrower hereunder
to pay any amount owing with respect to the Obligations. In the event of any
conflict between the accounts and records maintained by any Lender and the
accounts and records of the Administrative Agent in respect of such matters, the
accounts and records of the Administrative Agent shall control in the absence of
manifest error. Upon the request of any Lender made through the Administrative
Agent, the Borrower shall execute and deliver to such Lender (through the
Administrative Agent) a Note, which shall evidence such Lender's Loans in
addition to such accounts or records. Each Lender may attach schedules to its
Note and endorse thereon the date, Type (if applicable), amount and maturity of
its Loans and payments with respect thereto.
2.10 PAYMENTS GENERALLY.
(a) All payments to be made by the Borrower shall be made without
condition or deduction for any counterclaim, defense, recoupment or setoff.
Except as otherwise expressly provided herein, all payments by the Borrower
hereunder shall be made to the Administrative Agent, for the account of the
respective Lenders to which such payment is owed, at the Administrative Agent's
Office in Dollars and in immediately available funds not later than 2:00 p.m. on
the date specified herein. The Administrative Agent will promptly distribute to
each Lender its Pro Rata Share (or other applicable share as provided herein) of
such payment in like funds as received by wire transfer to such Lender's Lending
Office. All payments received by the Administrative Agent after 2:00 p.m. shall
be deemed received on the next succeeding Business Day and any applicable
interest or fee shall continue to accrue.
26
(b) If any payment to be made by the Borrower shall come due on a day
other than a Business Day, payment shall be made on the next following Business
Day, and such extension of time shall be reflected in computing interest or
fees, as the case may be.
(c) Unless the Borrower or any Lender has notified the Administrative
Agent, prior to the date any payment is required to be made by it to the
Administrative Agent hereunder, that the Borrower or such Lender, as the case
may be, will not make such payment, the Administrative Agent may assume that the
Borrower or such Lender, as the case may be, has timely made such payment and
may (but shall not be so required to), in reliance thereon, make available a
corresponding amount to the Person entitled thereto. If and to the extent that
such payment was not in fact made to the Administrative Agent in immediately
available funds, then:
(i) if the Borrower failed to make such payment, each Lender
shall forthwith on demand repay to the Administrative Agent the portion
of such assumed payment that was made available to such Lender in
immediately available funds, together with interest thereon in respect
of each day from and including the date such amount was made available
by the Administrative Agent to such Lender to the date such amount is
repaid to the Administrative Agent in immediately available funds at
the Federal Funds Rate from time to time in effect; and
(ii) if any Lender failed to make such payment, such Lender
shall forthwith on demand pay to the Administrative Agent the amount
thereof in immediately available funds, together with interest thereon
for the period from the date such amount was made available by the
Administrative Agent to the Borrower to the date such amount is
recovered by the Administrative Agent (the "Compensation Period") at a
rate per annum equal to the Federal Funds Rate from time to time in
effect. If such Lender pays such amount to the Administrative Agent,
then such amount shall constitute such Lender's Loan included in the
applicable Borrowing. If such Lender does not pay such amount forthwith
upon the Administrative Agent's demand therefor, the Administrative
Agent may make a demand therefor upon the Borrower, and the Borrower
shall pay such amount to the Administrative Agent, together with
interest thereon for the Compensation Period at a rate per annum equal
to the rate of interest applicable to the applicable Borrowing. Nothing
herein shall be deemed to relieve any Lender from its obligation to
fulfill its Commitment or to prejudice any rights which the
Administrative Agent or the Borrower may have against any Lender as a
result of any default by such Lender hereunder.
A notice of the Administrative Agent to any Lender or the Borrower with
respect to any amount owing under this subsection (c) shall be conclusive,
absent manifest error.
(d) If any Lender makes available to the Administrative Agent funds for
any Loan to be made by such Lender as provided in the foregoing provisions of
this Article II, and such funds are not made available to the Borrower by the
Administrative Agent because the conditions to the applicable Borrowing set
forth in Article IV are not satisfied or waived in accordance with the terms
hereof, the Administrative Agent shall return such funds (in like funds as
received from such Lender) to such Lender, without interest.
27
(e) The obligations of the Lenders hereunder to make Loans are several
and not joint. The failure of any Lender to make any Loan or to fund any such
participation on any date required hereunder shall not relieve any other Lender
of its corresponding obligation to do so on such date, and no Lender shall be
responsible for the failure of any other Lender to so make its Loan or purchase
its participation.
(f) Nothing herein shall be deemed to obligate any Lender to obtain the
funds for any Loan in any particular place or manner or to constitute a
representation by any Lender that it has obtained or will obtain the funds for
any Loan in any particular place or manner.
2.11 SHARING OF PAYMENTS. If, other than as expressly provided
elsewhere herein, any Lender shall obtain on account of the Loans made by it,
any payment (whether voluntary, involuntary, through the exercise of any right
of set-off, or otherwise) in excess of its ratable share (or other share
contemplated hereunder) thereof, such Lender shall immediately (a) notify the
Administrative Agent of such fact, and (b) purchase from the other Lenders such
participations in the Loans made by them as shall be necessary to cause such
purchasing Lender to share the excess payment in respect of such Loans or such
participations, as the case may be, pro rata with each of them; provided,
however, that if all or any portion of such excess payment is thereafter
recovered from the purchasing Lender under any of the circumstances described in
Section 10.06 (including pursuant to any settlement entered into by the
purchasing Lender in its discretion), such purchase shall to that extent be
rescinded and each other Lender shall repay to the purchasing Lender the
purchase price paid therefor, together with an amount equal to such paying
Lender's ratable share (according to the proportion of (i) the amount of such
paying Lender's required repayment to (ii) 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, without further
interest thereon. The Borrower agrees that any Lender so purchasing a
participation from another Lender may, to the fullest extent permitted by law,
exercise all its rights of payment (including the right of set-off, but subject
to Section 10.09) with respect to such participation as fully as if such Lender
were the direct creditor of the Borrower in the amount of such participation.
The Administrative Agent will keep records (which shall be conclusive and
binding in the absence of manifest error) of participations purchased under this
Section and will in each case notify the Lenders following any such purchases or
repayments. Each Lender that purchases a participation pursuant to this Section
shall from and after such purchase have the right to give all notices, requests,
demands, directions and other communications under this Agreement with respect
to the portion of the Obligations purchased to the same extent as though the
purchasing Lender were the original owner of the Obligations purchased.
2.12 EXTENSION OF MATURITY DATE.
(a) Not earlier than 60 days prior to, nor later than 45 days prior to,
the first and second anniversary of the Closing Date, the Borrower may, upon
notice to the Administrative Agent (which shall promptly notify the Lenders),
request a 364-day extension of the Stated Maturity Date then in effect. Within
30 days of delivery of such notice, each Lender shall notify the Administrative
Agent whether or not it consents to such extension (which consent may be
28
given or withheld in such Lender's sole and absolute discretion). Any Lender not
responding within the above time period shall be deemed not to have consented to
such extension. The Administrative Agent shall promptly notify the Borrower and
the Lenders of the Lenders' responses. If any Lender declines, or is deemed to
have declined, to consent to such extension, the Borrower may cause any such
Lender to be replaced as a Lender pursuant to Section 10.16.
(b) The Stated Maturity Date shall be extended only if Lenders holding
at least 66-2/3% of the Aggregate Commitments (calculated prior to giving effect
to any replacements of Lenders permitted herein) (the "Consenting Lenders") have
consented thereto. If so extended, the Maturity Date, as to the Consenting
Lenders, shall be extended to a date 364 days from the Stated Maturity Date then
in effect, effective as of the Stated Maturity Date then in effect (such
existing Stated Maturity Date being the "Extension Effective Date"). The
Administrative Agent and the Borrower shall promptly confirm to the Lenders such
extension and the Extension Effective Date. As a condition precedent to such
extension, the Borrower shall deliver to the Administrative Agent a certificate
of the Borrower dated as of the Extension Effective Date signed by a Responsible
Officer of the Borrower (i) certifying and attaching the resolutions adopted by
the Borrower approving or consenting to such extension, (ii) certifying that the
terms of any outstanding Permitted Preferred Trust Securities and Permitted
Subordinated Trust Indebtedness are in compliance with the requirement set forth
in the definitions of "Permitted Preferred Trust Securities" and "Permitted
Subordinated Trust Indebtedness" herein contained, (iii) certifying that the
terms of any Permitted Affiliate Subordinated Indebtedness are in compliance
with the requirements set forth in the definition of "Permitted Affiliate
Subordinated Indebtedness" herein contained, and (iv) certifying that, before
and after giving effect to such extension, (A) the representations and
warranties contained in Article V and the other Loan Documents are true and
correct in all material respects on and as of the Extension Effective Date,
except to the extent that such representations and warranties specifically refer
to an earlier date, in which case they are true and correct as of such earlier
date, and except that for purposes of this Section 2.12, the representations and
warranties contained in subsections (a) and (b) of Section 5.13 shall be deemed
to refer to the most recent statements furnished pursuant to subsections (a) and
(b), respectively, of Section 6.01, and (B) no Default or Event of Default
exists. The Borrower shall prepay any Loans outstanding on the Extension
Effective Date (and pay any additional amounts required pursuant to Section
3.05) to the extent necessary to repay Loans of Lenders who have not consented
to the extension and to keep outstanding Loans ratable with any revised and new
Pro Rata Shares of all the Lenders effective as of the Extension Effective Date.
Prior to the Extension Effective Date, the Borrower may withdraw its election
pursuant to this Section 2.12, and if the Borrower makes such withdrawal, the
Extension Effective Date will not occur; and in such case the Borrower may
exercise the Term-Out option set forth in Section 2.13, subject to compliance
with the time periods and other requirements set forth therein.
(c) This Section shall supersede any provisions in Section 2.11 or
10.01 to the contrary.
2.13 TERM-OUT OPTION.
(a) Provided no Default or Event of Default has occurred and is
continuing, the Borrower may, upon prior written notice to the Administrative
Agent sent not earlier than 60
29
days prior to, nor later than 10 days prior to, the Stated Maturity Date, elect
to have the principal balance of the Loans outstanding on the Stated Maturity
Date continued to the Term Loan Maturity Date as non-revolving Term Loans (the
"Term-Out"). As a condition precedent to the Term-Out, the Borrower shall
deliver to the Administrative Agent a certificate of the Borrower dated the
effective date of the Term-Out signed by a Responsible Officer of the Borrower
(i) certifying and attaching the resolutions adopted by the Borrower approving
or consenting to such Term-Out, (ii) certifying that the terms of any
outstanding Permitted Preferred Trust Securities and Permitted Subordinated
Trust Indebtedness are in compliance with the requirement set forth in the
definitions of "Permitted Preferred Trust Securities" and "Permitted
Subordinated Trust Indebtedness" herein contained, (iii) certifying that the
terms of any Permitted Affiliate Subordinated Indebtedness are in compliance
with the requirements set forth in the definition of "Permitted Affiliate
Subordinated Indebtedness" herein contained, and (iv) certifying that, before
and after giving effect to such extension, (A) the representations and
warranties contained in Article V and the other Loan Documents are true and
correct in all material respects on and as of the Extension Effective Date,
except to the extent that such representations and warranties specifically refer
to an earlier date, in which case they are true and correct as of such earlier
date, and except that for purposes of this Section 2.13, the representations and
warranties contained in subsections (a) and (b) of Section 5.13 shall be deemed
to refer to the most recent statements furnished pursuant to subsections (a) and
(b), respectively, of Section 6.01, and (B) no Default or Event of Default
exists.
(b) During the period of such Term Loans, the Borrower may repay but
not reborrow the outstanding Term Loans as provided in Section 2.03 hereof,
except as may be required from time to time to continue the outstanding
principal balance of maturing Loans pursuant to Section 2.02.
ARTICLE III.
TAXES, YIELD PROTECTION AND ILLEGALITY
3.01 TAXES.
(a) Any and all payments by the Borrower to or for the account of the
Administrative Agent or any Lender under any Loan Document shall be made free
and clear of and without deduction for any and all present or future taxes,
duties, levies, imposts, deductions, assessments, fees, withholdings or similar
charges, and all liabilities with respect thereto, excluding, in the case of the
Administrative Agent and each Lender, taxes imposed on or measured by its
overall net income, and franchise taxes imposed on it (in lieu of net income
taxes), by the jurisdiction (or any political subdivision thereof) under the
Laws of which the Administrative Agent or such Lender, as the case may be, is
organized or maintains a lending office (all such non-excluded taxes, duties,
levies, imposts, deductions, assessments, fees, withholdings or similar charges,
and liabilities being hereinafter referred to as "Taxes"). If the Borrower shall
be required by any Laws to deduct any Taxes from or in respect of any sum
payable under any Loan Document to the Administrative Agent or any Lender, (i)
the sum payable shall be increased as necessary so that after making all
required deductions (including deductions applicable to additional sums payable
under this Section), each of the Administrative Agent and such Lender receives
an amount equal to the sum it would have received had no such deductions been
made, (ii) the
30
Borrower shall make such deductions, (iii) the Borrower shall pay the full
amount deducted to the relevant taxation authority or other authority in
accordance with applicable Laws, and (iv) within 30 days after the date of such
payment, the Borrower shall furnish to the Administrative Agent (which shall
forward the same to such Lender) the original or a certified copy of a receipt
evidencing payment thereof.
(b) In addition, the Borrower agrees to pay any and all present or
future stamp, court or documentary taxes and any other excise or property taxes
or charges or similar levies which arise from any payment made under any Loan
Document or from the execution, delivery, performance, enforcement or
registration of, or otherwise with respect to, any Loan Document (hereinafter
referred to as "Other Taxes").
(c) If the Borrower shall be required to deduct or pay any Taxes or
Other Taxes from or in respect of any sum payable under any Loan Document to the
Administrative Agent or any Lender, the Borrower shall also pay to the
Administrative Agent or to such Lender, as the case may be, at the time interest
is paid, such additional amount that the Administrative Agent or such Lender
specifies is necessary to preserve the after-tax yield (after factoring in all
taxes, including taxes imposed on or measured by net income) that the
Administrative Agent or such Lender would have received if such Taxes or Other
Taxes had not been imposed.
(d) The Borrower agrees to indemnify the Administrative Agent and each
Lender for (i) the full amount of Taxes and Other Taxes (including any Taxes or
Other Taxes imposed or asserted by any jurisdiction on amounts payable under
this Section) paid by the Administrative Agent and such Lender, (ii) amounts
payable under Section 3.01(c) and (iii) any liability (including additions to
tax, penalties, interest and expenses) arising therefrom or with respect
thereto, in each case whether or not such Taxes or Other Taxes were correctly or
legally imposed or asserted by the relevant Governmental Authority. Payment
under this subsection (d) shall be made within 30 days after the date the Lender
or the Administrative Agent makes a demand therefor.
3.02 ILLEGALITY. If any Lender determines that any Law has made it
unlawful, or that any Governmental Authority has asserted that it is unlawful,
for any Lender or its applicable Lending Office to make, maintain or fund
Eurodollar Rate Loans, or to determine or charge interest rates based upon the
Eurodollar Rate, then, on notice thereof by such Lender to the Borrower through
the Administrative Agent, any obligation of such Lender to make or continue
Eurodollar Rate Loans or to convert Base Rate Loans to Eurodollar Rate Loans
shall be suspended until such Lender notifies the Administrative Agent and the
Borrower that the circumstances giving rise to such determination no longer
exist. Upon receipt of such notice, the Borrower shall, upon demand from such
Lender (with a copy to the Administrative Agent), prepay or, if applicable,
convert all Eurodollar Rate Loans of such Lender to Base Rate Loans, either on
the last day of the Interest Period therefor, if such Lender may lawfully
continue to maintain such Eurodollar Rate Loans to such day, or immediately, if
such Lender may not lawfully continue to maintain such Eurodollar Rate Loans.
Upon any such prepayment or conversion, the Borrower shall also pay accrued
interest on the amount so prepaid or converted. Each Lender agrees to designate
a different Lending Office if such designation will avoid the
31
need for such notice and will not, in the good faith judgment of such Lender,
otherwise be materially disadvantageous to such Lender.
3.03 INABILITY TO DETERMINE RATES. If the Required Lenders determine
that for any reason adequate and reasonable means do not exist for determining
the Eurodollar Rate for any requested Interest Period with respect to a proposed
Eurodollar Rate Loan, or that the Eurodollar Rate for any requested Interest
Period with respect to a proposed Eurodollar Rate Loan does not adequately and
fairly reflect the cost to such Lenders of funding such Loan, the Administrative
Agent will promptly so notify the Borrower and each Lender. Thereafter, the
obligation of the Lenders to make or maintain Eurodollar Rate Loans shall be
suspended until the Administrative Agent (upon the instruction of the Required
Lenders) revokes such notice. Upon receipt of such notice, the Borrower may
revoke any pending request for a Borrowing of, conversion to or continuation of
Eurodollar Rate Loans or, failing that, will be deemed to have converted such
request into a request for a Borrowing of Base Rate Loans in the amount
specified therein.
3.04 INCREASED COST AND REDUCED RETURN; CAPITAL ADEQUACY; RESERVES ON
EURODOLLAR RATE LOANS.
(a) If any Lender determines that as a result of the introduction of or
any change in or in the interpretation of any Law, or such Lender's compliance
therewith, there shall be any increase in the cost to such Lender of agreeing to
make or making, funding or maintaining Eurodollar Rate Loans or a reduction in
the amount received or receivable by such Lender in connection with any of the
foregoing (excluding for purposes of this subsection (a) any such increased
costs or reduction in amount resulting from (i) Taxes or Other Taxes (as to
which Section 3.01 shall govern), (ii) changes in the basis of taxation of
overall net income or overall gross income by the United States or any foreign
jurisdiction or any political subdivision of either thereof under the Laws of
which such Lender is organized or has its Lending Office, and (iii) reserve
requirements contemplated by Section 3.04(c)), then from time to time upon
demand of such Lender (with a copy of such demand to the Administrative Agent),
the Borrower shall pay to such Lender such additional amounts as will compensate
such Lender for such increased cost or reduction.
(b) If any Lender determines that the introduction of any Law regarding
capital adequacy or any change therein or in the interpretation thereof, or
compliance by such Lender (or its Lending Office) therewith, has the effect of
reducing the rate of return on the capital of such Lender or any corporation
controlling such Lender as a consequence of such Lender's obligations hereunder
(taking into consideration its policies with respect to capital adequacy and
such Lender's desired return on capital), then from time to time upon demand of
such Lender (with a copy of such demand to the Administrative Agent), the
Borrower shall pay to such Lender such additional amounts as will compensate
such Lender for such reduction.
(c) The Borrower shall pay to each Lender, as long as such Lender shall
be required to maintain reserves with respect to liabilities or assets
consisting of or including Eurocurrency funds or deposits (currently known as
"Eurocurrency liabilities"), additional interest on the unpaid principal amount
of each Eurodollar Rate Loan equal to the actual costs of such reserves
allocated to such Loan by such Lender (as determined by such Lender in good
faith, which
32
determination shall be conclusive), which shall be due and payable on each date
on which interest is payable on such Loan, provided the Borrower shall have
received at least 15 days' prior notice (with a copy to the Administrative
Agent) of such additional interest from such Lender. If a Lender fails to give
notice 15 days prior to the relevant Interest Payment Date, such additional
interest shall be due and payable 15 days from receipt of such notice. The
Borrower shall not be required to compensate a Lender pursuant to this
subsection (c) for any additional costs incurred more than 180 days prior to the
date that such Lender gives notice to the Borrower of additional costs and of
the Lender's intention to claim compensation therefor; provided, that if the
change in law or regulations giving rise to such costs is retroactive, then the
180-day period shall be extended to include the period of retroactive effect
thereof.
3.05 FUNDING LOSSES. Upon demand of any Lender (with a copy to the
Administrative Agent) from time to time, the Borrower shall promptly compensate
such Lender for and hold such Lender harmless from any loss, cost or expense
incurred by it as a result of:
(a) any continuation, conversion, payment or prepayment of any Loan
other than a Base Rate Loan on a day other than the last day of the Interest
Period for such Loan (whether voluntary, mandatory, automatic, by reason of
acceleration, or otherwise);
(b) any failure by the Borrower (for a reason other than the failure of
such Lender to make a Loan) to prepay, borrow, continue or convert any Loan
other than a Base Rate Loan on the date or in the amount notified by the
Borrower; or
(c) any assignment of a Eurodollar Rate Loan on a day other than the
last day of the Interest Period therefor as a result of a request by the
Borrower pursuant to Section 10.16;
including any loss of anticipated profits and any loss or expense arising from
the liquidation or reemployment of funds obtained by it to maintain such Loan or
from fees payable to terminate the deposits from which such funds were obtained.
The Borrower shall also pay any customary administrative fees charged by such
Lender in connection with the foregoing.
For purposes of calculating amounts payable by the Borrower to the Lenders under
this Section 3.05, each Lender shall be deemed to have funded each Eurodollar
Rate Loan made by it at the Eurodollar Rate for such Loan by a matching deposit
or other borrowing in the London interbank eurodollar market for a comparable
amount and for a comparable period, whether or not such Eurodollar Rate Loan was
in fact so funded.
3.06 MATTERS APPLICABLE TO ALL REQUESTS FOR COMPENSATION.
(a) A certificate of the Administrative Agent or any Lender claiming
compensation under this Article III and setting forth the additional amount or
amounts to be paid to it hereunder shall be conclusive in the absence of
manifest error. In determining such amount, the Administrative Agent or such
Lender may use any reasonable averaging and attribution methods.
(b) Upon any Lender's making a claim for compensation under Section
3.01 or 3.04, the Borrower may replace such Lender in accordance with Section
10.16.
33
(c) Upon any Lender's making a determination that it is unlawful to
maintain Eurodollar Rate Loans and such Lender fails to designate a different
Lending Office pursuant to Section 3.02, the Borrower may replace such Lender in
accordance with Section 10.16.
3.07 SURVIVAL. All of the Borrower's obligations under this Article III
shall survive termination of the Aggregate Commitments and repayment of all
other Obligations hereunder; provided, that with respect to amounts payable
under Sections 3.04 and 3.05, such amounts shall be deemed to have been paid if
no claim therefor is made within two years after the date that all Loans have
been paid in full and all commitments to make Loans hereunder have terminated.
ARTICLE IV.
CONDITIONS PRECEDENT TO CREDIT EXTENSIONS
4.01 CONDITIONS OF INITIAL BORROWING. The obligation of each Lender to
make its initial Loan hereunder is subject to satisfaction of the following
conditions precedent:
(a) The Administrative Agent's receipt of the following, each of which
shall be originals or facsimiles (followed promptly by originals) unless
otherwise specified, each properly executed by a Responsible Officer of the
Borrower, each dated the Closing Date (or, in the case of certificates of
governmental officials, a recent date before the Closing Date) and each in form
and substance satisfactory to the Administrative Agent and its legal counsel:
(i) executed counterparts of this Agreement, sufficient in number for
distribution to the Administrative Agent, each Lender and the Borrower;
(ii) a Note executed by the Borrower in favor of each Lender requesting
a Note;
(iii) such certificates of resolutions or other action, incumbency
certificates and/or other certificates of Responsible Officers of the Borrower
as the Administrative Agent may require evidencing the identity, authority and
capacity of each Responsible Officer thereof authorized to act as a Responsible
Officer in connection with this Agreement and the other Loan Documents;
(iv) each of the following documents:
(A) a certificate for the Borrower from the Secretary of State
of the State of Delaware listing the Certificate of Incorporation and
each amendment, if any, thereto, on file in his office and stating that
such documents are the only charter documents of the Borrower on file
in his office and that the Borrower is duly incorporated and in good
standing in the State of Delaware, and has filed all franchise tax
returns and has paid all franchise taxes required by law to be filed
and paid by the Borrower as of the date of his certificate; and
(B) signed certificates of the Secretaries of State (or other
appropriate officials) of each appropriate State set forth on Schedule
4.01, dated reasonably near the
34
Closing Date, certifying that the Borrower is duly qualified and in
good standing as a foreign corporation in such State;
(v) a favorable opinion of Sidley Xxxxxx Xxxxx & Xxxx, counsel to the
Borrower, addressed to the Administrative Agent and each Lender, substantially
in the form set forth in Exhibit G-1 and such other matters concerning the
Borrower and the Loan Documents as the Required Lenders may reasonably request;
(vi) a favorable opinion of Peer X. Xxxxxxxx, Vice President and
General Counsel to the Borrower, addressed to the Administrative Agent and each
Lender, substantially in the form set forth in Exhibit G-2 and such other
matters concerning the Borrower and the Loan Documents as the Required Lenders
may reasonably request;
(vii) a favorable opinion of Xxxxx Xxxxxxx, General Counsel to PDVSA,
addressed to the Administrative Agent and each Lender, substantially in the form
set forth in Exhibit G-3 and such other matters concerning the Borrower and the
Loan Documents as the Required Lenders may reasonably request;
(viii) a certificate of a Responsible Officer of the Borrower either
(A) attaching copies of all consents, licenses and approvals required in
connection with the execution, delivery and performance by the Borrower and the
validity against the Borrower of the Loan Documents to which it is a party, and
such consents, licenses, and approvals shall be in full force and effect, or (B)
stating that no such consents, licenses or approvals are so required;
(ix) a certificate signed by a Responsible Officer of the Borrower
certifying (A) that the conditions specified in Sections 4.02(a) and (b) have
been satisfied, (B) that there has been no event or circumstance since September
30, 2002 that has had or could be reasonably expected to have, either
individually or in the aggregate, a Material Adverse Effect, and (C) a
calculation of (x) the Capitalization Ratio, (y) the ratio of EBITDA to Interest
Expense, and (z) the Net Worth of the Borrower as of the last day of the Fiscal
Quarter of the Borrower most recently ended prior to the Closing Date;
(x) certificates of insurance demonstrating that the Borrower and each
of its Subsidiaries has procured 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, in such
amounts and with such deductibles as is required by Section 6.05;
(xi) evidence that the Existing Credit Agreements have been or
concurrently with the Closing Date are being terminated and all loans
outstanding thereunder have been or concurrently with the Closing Date are being
repaid; and
(xii) such other assurances, certificates, documents, consents or
opinions as the Administrative Agent or the Required Lenders reasonably may
require.
35
(b) There shall be no threatened or pending litigation, inquiry, or
investigation contesting the Loan Documents or any transaction contemplated
thereby.
(c) Any fees and expenses required to be paid on or before the Closing
Date shall have been paid.
(d) Unless waived by the Administrative Agent, the Borrower shall have
paid all Attorney Costs of the Administrative Agent to the extent invoiced for
work performed prior to or on the Closing Date.
4.02 CONDITIONS TO ALL BORROWINGS. The obligation of each Lender to
honor any Loan Notice is subject to the following conditions precedent (provided
that the conditions set forth in subsection(a) of this Section 4.02 shall not
apply to a request to convert a Eurodollar Rate Loan to a Base Rate Loan):
(a) The representations and warranties of the Borrower contained in
Article V or any other Loan Document, or which are contained in any document
furnished at any time under or in connection herewith or therewith, shall be
true and correct in all material respects on and as of the date of such
Borrowing, except to the extent that such representations and warranties
specifically refer to an earlier date, in which case they shall be true and
correct as of such earlier date, and except that for purposes of this Section
4.02, the representations and warranties contained in subsections (a) and (b) of
Section 5.13 shall be deemed to refer to the most recent statements furnished
pursuant to clauses (a) and (b) of Section 6.01.
(b) No Default or Event of Default shall exist, or would result from
such proposed Borrowing.
(c) The Administrative Agent shall have received a Loan Notice in
accordance with the requirements hereof.
Each Loan Notice submitted by the Borrower shall be deemed to be a
representation and warranty that the conditions specified in Sections 4.02(a)
and (b) have been satisfied on and as of the date of the applicable Borrowing.
ARTICLE V.
REPRESENTATIONS AND WARRANTIES
The Borrower represents and warrants to the Administrative Agent and
each Lender that:
5.01 CORPORATE EXISTENCE; POWER; COMPLIANCE WITH LAWS.
(a) the Borrower is a corporation duly incorporated, validly existing
and in good standing under the laws of the State of Delaware, and each
Subsidiary of the Borrower is a corporation, partnership, or limited liability
company, as the case may be, duly incorporated or otherwise formed, validly
existing and in good standing under the laws of the state of its incorporation
or formation;
36
(b) the Borrower has all requisite corporate power and authority,
governmental licenses, authorizations, consents and approvals to own its assets,
carry on its business as currently conducted, to execute, deliver, and perform
its obligations under the Loan Documents, and to issue the Notes in the manner
and for the purpose contemplated by this Agreement, and each Subsidiary, has all
requisite corporate, partnership or limited liability company, as the case may
be, power and authority to own its assets and to carry on the business in which
it is engaged;
(c) the Borrower and each Subsidiary of the Borrower is duly qualified
as a foreign Person authorized to do business and is licensed and in good
standing under the laws of each jurisdiction where its ownership, lease or
operation of property or the conduct of its business requires such qualification
or license other than where the failure to be so qualified or in good standing
would not reasonably be expected to have a Material Adverse Effect; and
(d) the Borrower and each of its Subsidiaries is in compliance in all
material respects with all Requirements of Law, except to the extent that the
failure to do so would not reasonably be expected to have a Material Adverse
Effect.
5.02 CORPORATE AUTHORIZATION; NO CONTRAVENTION. The execution, delivery
and performance by the Borrower of the Loan Documents have been duly authorized
by all necessary corporate action, and do not and will not:
(a) contravene the terms of any of the Borrower's Organization
Documents;
(b) result in any breach or contravention of, or result in the creation
of any Lien under, any document evidencing any Contractual Obligation to which
the Borrower is a party or any order, injunction, writ or decree of any
Governmental Authority to which the Borrower or its property is subject (other
than such violations, breaches, defaults or Liens which would not reasonably be
expected to have a Material Adverse Effect); or
(c) violate any Requirement of Law.
5.03 GOVERNMENTAL AUTHORIZATION; OTHER CONSENTS. No approval, consent,
exemption, authorization, or other action by, or notice to, or filing with, any
Governmental Authority or other Person is necessary for the validity of the
execution, delivery or performance by, or enforcement against, the Borrower of
this Agreement or any Note other than routine informational filings with the SEC
and/or other Governmental Authorities.
5.04 BINDING EFFECT. This Agreement and (when executed and delivered
for value) each other Loan Document constitute the legal, valid and binding
obligations of the Borrower, enforceable against the Borrower in accordance with
their respective terms, except as limited by applicable bankruptcy, insolvency,
reorganization, moratorium or other similar laws affecting the enforcement of
creditors' rights generally or by equitable principles relating to
enforceability, and by judicial discretion regarding the enforcement of or any
applicable laws affecting remedies (whether considered in a court of law or a
proceeding in equity).
37
5.05 LITIGATION. No litigation (including derivative actions),
arbitration proceedings or governmental proceedings are pending or, to the best
knowledge of the Borrower after due inquiry, overtly threatened against the
Borrower or any Subsidiary (a) which would reasonably be expected to result in a
Material Adverse Effect, or (b) that question the validity or enforceability of
this Agreement or the transactions contemplated hereby. Neither the Borrower nor
any of its Subsidiaries has knowledge of any material contingent liabilities,
including those disclosed in the financial statements referred to in Section
5.13, which would reasonably be expected to have a Material Adverse Effect.
5.06 NO DEFAULT. No Default or Event of Default exists. Neither the
Borrower nor any Subsidiary is in default under or with respect to its
Organization Documents in any respect which, individually or together with all
other such defaults, would reasonably be expected to have a Material Adverse
Effect.
5.07 FIRE, STRIKE, ACT OF GOD, ETC. Neither the business nor the
properties of the Borrower or any of its Subsidiaries are now affected by any
fire, explosion, accident, labor controversy, strike, lockout or other dispute,
drought, storm, hail, earthquake, embargo, act of God or of the public enemy or
other casualty which would reasonably be expected to have a Material Adverse
Effect, or if any such existing event or condition were to continue for more
than 30 additional days (unless in the reasonable opinion of the Borrower such
event or condition is not likely to continue for such period) would reasonably
be expected to have a Material Adverse Effect.
5.08 LIENS. None of the assets or properties of the Borrower or the
Subsidiaries is subject to any Lien except for Permitted Liens.
5.09 ERISA. Each Plan and, to the best of the Borrower's knowledge,
each Multiemployer Plan, complies in all material respects with all Requirements
of Law except to the extent that noncompliance could not reasonably be expected
to have a Material Adverse Effect and,
(a) no Reportable Event for which the PBGC has not waived the 30-day
notice requirement has occurred with respect to any Plan or, to the best of the
Borrower's knowledge, any Multiemployer Plan, which could result in the Borrower
incurring a liability or obligation in excess of $10,000,000;
(b) no steps have been taken to terminate any Plan which could result
in the Borrower's making a contribution, or incurring a liability or obligation,
to such Plan in excess of $10,000,000; no steps have been taken to appoint a
receiver to administer any such Plan; to the best of the Borrower's knowledge,
no steps have been taken to terminate or appoint a receiver to administer any
Multiemployer Plan which could result in the Borrower's making a contribution,
or incurring a liability or obligation, to such Multiemployer Plan in excess of
$10,000,000; and neither the Borrower nor any Related Person has withdrawn from
any such Multiemployer Plan or initiated steps to do so;
38
(c) There is no Unfunded Vested Liability with respect to any Plan or,
to the best of the Borrower's knowledge, any Multiemployer Plan, that would
reasonably be expected to have, in the event of termination of such Plan or
withdrawal from such Multiemployer Plan, a Material Adverse Effect; and
(d) no contribution failure has occurred with respect to any 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 Plan which would
reasonably be expected to have a Material Adverse Effect; and neither the
Borrower nor any of its Subsidiaries has any contingent liability with respect
to any post-retirement benefit under a Welfare Plan, other than liability for
continuation coverage described in Part 5 of Title I of ERISA, that would
reasonably be expected to have a Material Adverse Effect.
5.10 USE OF PROCEEDS; MARGIN REGULATIONS. The proceeds of the Loans are
to be used solely for purposes not in contravention of subsection 7.01(i) or
subsection 7.01(k). Not more than 25% of the assets of the Borrower and its
Subsidiaries on a consolidated basis consists of any Margin Stock, and no part
of the proceeds of any Loan will be used to buy or carry any Margin Stock.
Neither the Borrower nor any Subsidiary is generally engaged in the business of
buying or selling Margin Stock or extending credit for the purpose of buying or
carrying Margin Stock.
5.11 TITLE TO PROPERTIES. The Borrower and each of its Subsidiaries (i)
has valid fee title to, or valid leasehold interests in, all of its respective
material real property, and has good and valid title to all of its respective
material personal properties and assets, of any nature whatsoever which are
reflected on the audited balance sheet referred to in Section 5.13 or acquired
by the Borrower or such Subsidiary after the date thereof except for assets
sold, transferred or otherwise disposed of since such date in the ordinary
course of business, except for such defects in title as would not, individually
or in the aggregate, be reasonably expected to have a Material Adverse Effect,
and (ii) the Borrower and each of its Subsidiaries owns or holds all permits
necessary to construct, own, operate, use and maintain its respective property
and assets and to conduct its respective business as now conducted except where
the failure to have such interest or title or to own or hold such permit would
not reasonably be expected to have a Material Adverse Effect.
5.12 TAXES. The Borrower and each Subsidiary has filed (or obtained
extensions with respect to the filing of) all United States federal income tax
returns and all other material tax returns which are required to be filed by it
and has paid all taxes as shown on such returns or pursuant to any assessment
received by the Borrower or any Subsidiary, except to the extent the same may be
contested in good faith and for which reserves have been established to the
extent required by GAAP. The charges, accruals and reserves on the books of the
Borrower and each Subsidiary in respect of Taxes and other governmental charges
are adequate to the best knowledge of the Borrower.
39
5.13 FINANCIAL CONDITION.
(a) The audited consolidated balance sheet of the Borrower and its
consolidated Subsidiaries as of December 31, 2001, and the related consolidated
statements of income or operations, shareholder's equity and cash flows for the
fiscal year ended on that date (i) were prepared in accordance with GAAP
consistently applied throughout the period covered thereby, except as otherwise
expressly noted therein; and (ii) fairly present the financial position of the
Borrower and its consolidated Subsidiaries as of the date thereof and results of
operations for the period covered thereby.
(b) The unaudited consolidated balance sheet of the Borrower and its
consolidated Subsidiaries as of September 30, 2002, and the related consolidated
statements of income or operations, shareholder's equity and cash flows for the
fiscal year ended on that date (i) were prepared in accordance with GAAP
consistently applied throughout the period covered thereby, except as otherwise
expressly noted therein; and (ii) fairly present the financial position of the
Borrower and its consolidated Subsidiaries as of the date thereof and results of
operations for the period covered thereby, subject, in the case of (i) and (ii),
to the absence of footnotes and to normal year-end audit adjustments.
(c) All Off-Balance Sheet Liabilities of the Borrower and its
Subsidiaries are accurately set forth (a) as of the Closing Date, on Schedule
5.13(c) and (b) as of the end of each Fiscal Year beginning with the Fiscal Year
ended December 31, 2002, on an updated Schedule attached to the Compliance
Certificate delivered by the Borrower with the most recent annual financial
statements delivered pursuant to Section 6.01(a).
(d) Since September 30, 2002, no event or condition has occurred which,
either individually or in the aggregate, has had or could reasonably be expected
to have a Material Adverse Effect, except as disclosed on Schedule 5.13(d).
5.14 ENVIRONMENTAL MATTERS. Each of the Borrower and its Subsidiaries
are in compliance in all material respects with all Federal, state and local
laws and regulations (i) now applicable to it, or (ii) which, to the best
knowledge of the Borrower will be applicable (or, if not in compliance with such
laws and regulations referred to in this clause (ii), the Borrower or such
Subsidiary is taking appropriate action diligently pursued to be in compliance
therewith on a timely basis or to be exempt from compliance) to it relating to
pollution control and environmental contamination, including all laws and
regulations governing the generation, use, collection, treatment, storage,
transportation, recovery, removal, discharge or disposal of Hazardous Materials,
except to the extent that the failure to comply or take such action would not
reasonably be expected to have a Material Adverse Effect. Except as disclosed on
Schedule 5.14 (as updated from time to time), (A) there are no presently
outstanding allegations by governmental officials that the Borrower or any of
its Subsidiaries is now or at any time prior to the date hereof, was in material
violation of such laws or regulations, (B) there are no material administrative
or judicial proceedings presently pending against the Borrower or any of its
Subsidiaries pursuant to such laws or regulations, and (C) there is no material
claim presently outstanding against the Borrower or any of its Subsidiaries
which was asserted pursuant to such laws or regulations that in each case would
reasonably be expected to result in a liability to the
40
Borrower or any Subsidiary in excess of $20,000,000 or $50,000,000 in the
aggregate for all such claims (net in each case of actual insurance coverage or
effective indemnification with respect thereto). Except as disclosed in Schedule
5.14 (as updated from time to time), the Borrower reasonably believes that no
facts or circumstances known to it or any Subsidiary could form the basis for
the assertion of any material claim against the Borrower or any Subsidiary
relating to environmental matters, including any material claim arising from
past or present environmental practices asserted under CERCLA, RCRA, or any
Environmental Law that in each case would reasonably be expected to result in a
liability to the Borrower or any Subsidiary in excess of $20,000,000 or
$50,000,000 in the aggregate for all such claims (net in each case of actual
insurance coverage or effective indemnification with respect thereto).
5.15 REGULATED ENTITIES. None of the Borrower, any Person controlling
the Borrower, or any Subsidiary, is an "Investment Company" within the meaning
of the Investment Company Act of 1940. The Borrower is not subject to regulation
under the Public Utility Holding Company Act of 1935, the Federal Power Act, the
Interstate Commerce Act or any state public utilities code.
5.16 COPYRIGHTS, PATENTS, TRADEMARKS AND LICENSES, ETC. The Borrower or
its Subsidiaries own or are licensed or otherwise have the right to use all of
the patents, trademarks, trade names, copyrights, contractual franchises,
authorizations and other rights that are reasonably necessary for the operation
of their respective businesses as currently conducted (other than where the
failure to so own, be licensed or have the right to use would reasonably be
expected to have a Material Adverse Effect). To the best knowledge of the
Borrower, no slogan or other advertising device, product process, method,
substance, part or other material now employed, or now contemplated to be
employed, by the Borrower or any Subsidiary infringes upon any rights held by
any other Person, except for any such infringement that would not reasonably be
expected to have a Material Adverse Effect.
5.17 SUBSIDIARIES. As of the Closing Date, the Borrower has no
Subsidiaries other than those disclosed in Schedule 5.17 hereto, and the
Borrower has no equity investments in any other corporation or other entity
other than those disclosed on Schedule 5.17 hereto.
5.18 SOLVENCY. The Borrower has capital sufficient to carry on its
business and transactions and all business and transactions in which it is about
to engage and is now solvent and able to pay its respective debts as they
mature, and the Borrower now owns property having a value, both at fair
valuation and at present fair salable value, greater than the amount required to
pay its existing debts.
5.19 FULL DISCLOSURE. None of the representations or warranties made by
the Borrower or any Subsidiary in this Agreement as of the date such
representations and warranties are made or deemed made, and none of the factual
information (taken as a whole) contained in any written notice, exhibit, report,
statement or certificate furnished by or on behalf of the Borrower or any
Subsidiary in connection with this Agreement (including the offering and
disclosure materials delivered by or on behalf of the Borrower to the Lenders
prior to the Closing Date), contains any untrue statement of a material fact or
omits any material fact required to be stated therein or
41
necessary to make the statements made therein, in light of the circumstances
under which they are made, not misleading as of the time when made or delivered.
ARTICLE VI.
AFFIRMATIVE COVENANTS
So long as any Lender shall have any Commitment hereunder, or any
Borrowing or other Obligation shall remain unpaid or unsatisfied, unless the
Required Lenders waive compliance in writing:
6.01 FINANCIAL STATEMENTS. The Borrower shall deliver to the
Administrative Agent and concurrently therewith to each Lender (in accordance
with Section 10.02, which shall be deemed received by each Lender when received
by the Administrative Agent):
(a) (i) as soon as available and in any event within 90 days (or within
the filing period required by the SEC for annual reporting) after the end of
each Fiscal Year, audited consolidated financial statements of the Borrower and
its consolidated Subsidiaries, prepared in accordance with GAAP, in each case
setting forth, in comparative form, the corresponding figures for the preceding
Fiscal Year and accompanied by an opinion, without Impermissible Qualification,
by independent certified public accountants of recognized national standing and
reputation selected by the Borrower or otherwise reasonably acceptable to the
Administrative Agent (the "Independent Accountants"), consisting of a balance
sheet as at the end of such Fiscal Year and statements of income and retained
earnings and statements of cash flows, and (ii) in the event that the Borrower
is no longer required by Law to file annual reports with the SEC, within thirty
days after the delivery of such financial statements, a report from the
Independent Accountants addressed to the Borrower's management containing a
review of the Borrower's calculations which show compliance with each of the
financial ratios and restrictions contained in Section 7.02 and affirmatively
indicating that, while the audit of the consolidated financial statements of the
Borrower and its consolidated Subsidiaries was not directed primarily toward
obtaining knowledge of such compliance with these specific financial ratios and
restrictions, such accountants have not become aware of events or transactions
that would render such calculations unreliable or misleading; and
(b) as soon as available and in any event within 45 days (or within the
filing period required by the SEC for quarterly reporting) after the end of each
Fiscal Quarter (except the last Fiscal Quarter of each Fiscal Year), (A)
consolidated financial statements of the Borrower and its consolidated
Subsidiaries, and (B) consolidated financial information of the Borrower and its
consolidated Subsidiaries, in each case consisting of a balance sheet as at the
end of such quarter and statements of income, retained earnings, and cash flows
for such Fiscal Quarter then ended and for the Fiscal Year through such quarter,
setting forth in comparative form the corresponding figures for the
corresponding dates and periods of the preceding Fiscal Year, all in reasonable
detail and certified (subject to year-end audit adjustments) by an authorized
financial officer of the Borrower to the best of such officer's knowledge and
belief as fairly presenting in accordance with GAAP (to the extent applicable)
the financial position and results of operations of the Borrower and its
consolidated Subsidiaries as at the date thereof and for the period
42
covered thereby (provided, that footnotes to such financial statements will not
be required) consistently applied (except as noted therein).
(c) Notwithstanding the preceding provisions of this Section 6.01, if
and so long as the Borrower shall file regular and periodic reports with the SEC
pursuant to Sections 13 and 15 of the Securities Exchange Act of 1934, delivery
to the Administrative Agent of copies of its reports on Forms 10K and 10Q
promptly following filing thereof with the SEC, but in any event not later than
within the periods set forth in subsections 6.01(a) and (b), shall constitute
full compliance with this Section 6.01.
6.02 CERTIFICATES; OTHER INFORMATION. The Borrower shall furnish to the
Administrative Agent:
(a) within thirty days after the delivery of the financial statements
(or reports on Form 10K) referred to in subsection 6.01(a), and within fifteen
days after delivery of the financial statements (or reports on Form 10Q)
referred to in subsection 6.01(b), a Compliance Certificate substantially in the
form of Exhibit E, executed by a Responsible Officer;
(b) promptly, to the extent not provided pursuant to Section 6.01(c),
copies of all financial statements and regular, periodic or special reports
(including registration statements (without exhibits) and Forms 10K, 10Q and 8K)
that the Borrower or any Subsidiary may make to, or file with, the SEC; and
(c) promptly, such additional information regarding the business,
financial or corporate affairs of the Borrower or any Subsidiary as the
Administrative Agent, at the request of any Lender, may from time to time
reasonably request in writing.
Documents required to be delivered pursuant to Section 6.01(a) or (b)
or Section 6.02(b) (to the extent any such documents are included in materials
otherwise filed with the SEC) may be delivered electronically and if so
delivered, shall be deemed to have been delivered on the date (i) on which the
Borrower posts such documents, or provides a link thereto on the Borrower's
website on the Internet at the website address listed on Schedule 10.02; or (ii)
on which such documents are posted on the Borrower's behalf on
IntraLinks/IntraAgency or another relevant website (including, without
limitation, the SEC's website), if any, to which each Lender and the
Administrative Agent have access (whether a commercial, third-party website or
whether sponsored by the Administrative Agent); provided that: (i) the Borrower
shall deliver paper copies of such documents to the Administrative Agent or any
Lender that requests the Borrower to deliver such paper copies and (ii) the
Borrower shall notify (which may be by facsimile or electronic mail) the
Administrative Agent of the posting of any such documents and provide to the
Administrative Agent by electronic mail electronic versions (i.e., soft copies)
of such documents. Notwithstanding anything contained herein, in every instance
the Borrower shall be required to provide paper copies of the Compliance
Certificates required by Section 6.02(a) to the Administrative Agent and each of
the Lenders. Except for such Compliance Certificates, the Administrative Agent
shall have no obligation to request the delivery or to maintain copies of the
documents referred to above, and in any event shall have no responsibility to
monitor
43
compliance by the Borrower with any such request for delivery, and each Lender
shall be solely responsible for requesting delivery to it or maintaining its
copies of such documents.
6.03 NOTICES. The Borrower shall notify the Administrative Agent, and
each Lender in writing:
(a) as soon as possible and in any event within 5 Business Days after
the Borrower becomes aware of the occurrence of any Default or Event of Default,
the statement of the President, any Vice President or the Treasurer of the
Borrower setting forth the details of each such Default or Event of Default
which has occurred and the action which the Borrower has taken and proposes to
take with respect thereto;
(b) forthwith upon learning thereof, a description of (i) the
institution of any litigation, arbitration proceeding or governmental proceeding
to which the Borrower or any Subsidiary of the Borrower is a party that would
reasonably be expected to result in a liability to the Borrower or any
Subsidiary of the Borrower in excess of $25,000,000 (net of actual insurance
coverage or effective indemnification with respect thereto), and any material
adverse determination as to liability or amount of damages in any such
litigation, arbitration proceeding or proceeding; and (ii) any matter that has
resulted or could reasonably be expected to result in a Material Adverse Effect;
(c) promptly upon learning thereof, a description of the institution of
any steps of the Borrower or any other Person to terminate any Plan or any
Multiemployer Plan, or the appointment of a receiver to administer any Plan or
any Multiemployer Plan, or the withdrawal by the Borrower or any Related Person
from any Multiemployer Plan, or the failure to make a required contribution to
any 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 Plan which could
result in the requirement that the Borrower furnish a bond or other security to
the PBGC or such Plan, or the occurrence of any event with respect to any Plan
which could reasonably be expected to 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; and
(d) within 10 Business Days after the close of a Material Acquisition
by the Borrower or any Subsidiary, the most recent annual and quarterly
financial reports of the acquired entity which are available to the Borrower,
and, a summary of the environmental due diligence work done for or by the
Borrower in connection with such Material Acquisition (it being understood that
any Persons) engaged by the Borrower to prepare such a summary and to complete
such due diligence must be of recognized national standing in the environmental
field).
6.04 PRESERVATION OF CORPORATE EXISTENCE, ETC. The Borrower shall, and
shall cause each Subsidiary to, except for any sale, dissolution, liquidation or
merger not otherwise prohibited hereby, preserve and maintain its existence and
good standing and its rights, privileges and franchises under the laws of its
state or jurisdiction of incorporation or other formation, and remain qualified
as a foreign Person authorized to do business in each other
44
jurisdiction in which the failure to so qualify would reasonably be expected to
have a Material Adverse Effect.
6.05 INSURANCE. (a) The Borrower shall maintain, and cause each
Subsidiary to maintain, insurance with respect to their respective properties
and businesses against such liabilities, casualties, risks and contingencies
(including business interruption insurance) in such types and with such
reasonable deductibles and in such amounts (after giving effect to any
self-insurance compatible with the following standards) as are customary in the
case of Persons engaged in the same or similar businesses and similarly
situated. The Borrower and its Subsidiaries shall maintain such insurance (i)
with financially sound and reputable insurers that are not Affiliates of the
Borrower (it is agreed that Oil Insurance Limited and sEnergy Insurance Ltd.
shall not be considered Affiliates of the Borrower for purposes of this Section
6.05), or (ii) with Affiliates(s) ("Affiliated Insurers") to the extent as is
customary in the case of Persons engaged in the same or similar businesses as
Borrower and similarly situated, provided that each such Affiliated Insurer has
in place reinsurance or similar agreement(s) with financially sound and
reputable insurance companies that are not Affiliates of the Borrower
("Unaffiliated Insurers") providing coverage of the type required by this
Section 6.05. Such Affiliated Insurers' agreements with Unaffiliated Insurers
shall provide that (A) the interests and rights held by such Affiliated Insurers
vis-a-vis the Unaffiliated Insurers shall pass through to the Borrower (or its
Subsidiary as applicable), and such interests and rights of the Borrower (or its
Subsidiary as applicable) vis-a-vis the Unaffiliated Insurers shall not be
invalidated or impaired by any act or neglect of, or any bankruptcy, insolvency,
dissolution or other event with respect to, the Affiliated Insurers, and (B) in
the event of the insolvency, dissolution or financial impairment of the
Affiliated Insurers that adversely affects the Borrower's (or its Subsidiary's)
ability to enforce such interests and rights against and receive payment from
the Affiliated Insurer(s), such payment will be payable by the Unaffiliated
Insurers directly to the Borrower (or its Subsidiary as applicable) under the
same circumstances and in the same amounts as would have been available to the
Borrower but for the Affiliated Insurer's insolvency, dissolution or financial
impairment. With respect to the Borrower and its Subsidiaries, the Affiliated
Insurers shall not retain any risk that is not covered by such agreements with
Unaffiliated Insurers.
(b) Upon the execution of this Agreement and at any time thereafter at
the request of the Administrative Agent, the Borrower shall furnish or cause to
be furnished to the Administrative Agent evidence, in form and substance
satisfactory to the Administrative Agent, of the required insurance coverage of
the Borrower and each Subsidiary and, upon reasonable request, copies of the
applicable policies.
6.06 TAXES. The Borrower shall, and shall cause each Subsidiary to, pay
and discharge all Taxes relating to the Borrower or such Subsidiary, as the case
may be, prior to the date on which penalties attach thereto; provided, that
neither the Borrower nor any Subsidiary shall be required to pay or discharge
any such Tax while the same is being contested by it in good faith and by
appropriate proceedings and so long as reserves have been established to the
extent required by GAAP.
6.07 COMPLIANCE WITH LAWS. The Borrower shall comply, and shall cause
each Subsidiary to comply, in all material respects with all Requirements of
Law, including
45
Environmental Laws; provided, that neither the Borrower nor any Subsidiary shall
be required to comply with any such Requirement of Law so long as the validity
or application thereof is being contested in good faith and reserves have been
established with respect to such contest to the extent, if any, required by GAAP
or where such non-compliance would not reasonably be expected to have a Material
Adverse Effect, and obtain and maintain, and cause each Subsidiary to obtain and
maintain, all permits, licenses and approvals necessary to construct, own,
operate, use and maintain their respective properties and assets and to conduct
their respective businesses, except where the failure to obtain or maintain such
permit, license or approval would not reasonably be expected to have a Material
Adverse Effect.
6.08 COMPLIANCE WITH MATERIAL CONTRACTUAL OBLIGATIONS. The Borrower
shall comply, and shall cause each Subsidiary to comply, with all Contractual
Obligations except where failure to so comply would not reasonably be expected
to have a Material Adverse Effect.
6.09 INSPECTION OF PROPERTY AND BOOKS AND RECORDS. (a) The Borrower
shall keep or cause to be kept, and shall cause each Subsidiary to keep or cause
to be kept, adequate records and book of account in which complete entries are
to be made reflecting its business and financial transactions and as required by
applicable rules and regulations of any Governmental Authority having
jurisdiction over the Borrower or any Subsidiary or the transactions
contemplated by this Agreement. Such books of account shall be kept in a manner
consistent with GAAP if so kept on the date hereof. The Borrower shall permit,
and shall cause each Subsidiary to permit, the Administrative Agent or the
Lenders or their representatives at any reasonable time and from time to time at
the request of the Administrative Agent, to visit and inspect any of their
respective properties, to examine the respective corporate, financial and
operating records, and, subject to the confidentiality provisions contained in
Section 10.08 of this Agreement, make copies thereof or abstracts therefrom, and
to discuss their respective affairs, finances and accounts with their respective
officers, all at such reasonable times during normal business hours and as often
as may be reasonably desired, upon prior notice to the Borrower of at least 24
hours in advance; provided, however, that when an Event of Default exists the
Administrative Agent or any Lender may take the actions specified in this
sentence at any times during normal business hours and without advance notice.
One or more officers, employees or representatives of the Borrower may accompany
the Administrative Agent or a Lender or their respective representatives when
making any visit or inspection described in the preceding sentence.
(b) Neither the Administrative Agent nor any Lender has any duty to
visit or inspect the Borrower's or any Subsidiary's properties or to examine or
copy such records and neither the Administrative Agent nor any Lender shall
incur any obligation or liability by reason of not making any such visit or
inspection. In the event that the Administrative Agent or any Lender shall do
any of the foregoing, it will be acting solely for the purposes of protecting
the Administrative Agent or such Lender and preserving its rights under this
Agreement. Neither the Borrower nor any other party is entitled to rely on any
inspection or other inquiry by the Administrative Agent or any Lender. Neither
the Administrative Agent nor any Lender owes any duty of care to protect the
Borrower or any other party against, or to inform the Borrower or any other
party of, any adverse condition that may be observed as affecting the Borrower's
or any Subsidiary's properties or business. The Administrative Agent or any
Lender may in its
46
discretion disclose to the Borrower or any other Person any findings made as a
result of, or in connection with, any inspection of any such properties or
records.
6.10 MAINTENANCE OF PROPERTIES. The Borrower will, and will cause each
of its Subsidiaries to, keep and maintain all property material to the conduct
of its business in good working order and condition, ordinary wear and tear
excepted.
6.11 USE OF PROCEEDS. The Borrower will use the proceeds of the
Borrowings for working capital, capital expenditures, and other lawful general
corporate purposes not in contravention of Sections 7.01(i) or (k), any Law or
of any Loan Document.
ARTICLE VII.
NEGATIVE COVENANTS
So long as any Lender shall have any Commitment hereunder, or any
Borrowing or other Obligation shall remain unpaid or unsatisfied, unless the
Required Lenders waive compliance in writing:
7.01 NEGATIVE COVENANTS APPLICABLE TO THE BORROWER AND SUBSIDIARIES.
The Borrower shall not, and shall not suffer or permit any Subsidiary to,
directly or indirectly do any of the following:
(a) Limitation on Liens. The Borrower will not, and will not permit any
of its Subsidiaries to, directly or indirectly, incur or suffer to exist any
Lien on or with respect to any asset or property of the Borrower or such
Subsidiary, whether now owned or hereafter acquired, or any interest therein or
any income or profits therefrom, except the following (collectively, "Permitted
Liens", and individually, a "Permitted Lien"):
(i) Liens listed on Schedule 7.01 existing on the date hereof;
(ii) Liens on property existing at the time of acquisition
thereof or Liens affecting property of a Person existing at the time it
becomes a Subsidiary of the Borrower or at the time it is merged into
or consolidated with the Borrower or a Subsidiary of the Borrower;
provided, however, that, in either case, such Liens were not granted in
contemplation of such acquisition or in contemplation of the
transaction pursuant to which such Person became a Subsidiary; and
provided further that in either case, such Liens do not extend to or
cover any property of the Borrower or of any of its Subsidiaries other
than the property that secured the acquired Indebtedness prior to the
time such Indebtedness became Indebtedness of the Borrower or a
Subsidiary;
(iii) Liens on property securing Indebtedness incurred prior
to, at the time of, or within 12 months after the acquisition thereof
for the purpose of financing all or part of the purchase price thereof,
provided that such Liens do not extend to or cover any other property
of the Borrower or any Subsidiary and the Indebtedness secured thereby
was incurred to pay, and does not exceed, the purchase price thereof;
47
(iv) Liens on any improvements to property securing
Indebtedness incurred to provide funds for all or part of the cost of
such improvements in a principal amount not exceeding the cost of
acquisition or construction of such improvements and incurred within 12
months after completion of such improvements or construction, provided
that such Liens do not extend to or cover any property of the Borrower
or any Subsidiary other than such improvements;
(v) Liens to government entities granted to secure pollution
control or industrial revenue bond financings, which Liens in each
financing transaction cover only the property the acquisition of which,
or the construction of which, was financed by such financing, and
property related thereto;
(vi) Liens which secure Indebtedness (A) owing by a Subsidiary
of the Borrower to the Borrower or (B) owing by one Subsidiary to a
Wholly-Owned Subsidiary;
(vii) Liens imposed by law, including mechanics',
materialmen's, carriers' or other like Liens, arising in the ordinary
course of business, which are not overdue by a period of more than 45
days or which are being contested in good faith and by appropriate
proceedings diligently conducted;
(viii) any Lien incurred or deposits to secure the performance
of surety bonds incurred in the ordinary course of business consistent
with past practice, provided that such Liens shall cover only the
Borrower's or its Subsidiary's interests in and relating to the
contract underlying the transaction for which such surety bonds were
issued;
(ix) any Lien incidental to the normal conduct of the business
of the Borrower or any Subsidiary or the ownership of its property or
the conduct of the ordinary course of its business, including (A)
zoning restrictions, easements, rights of way, reservations,
restrictions on the use of real property and other minor irregularities
of title, (B) rights of lessees under leases, (C) rights of collecting
banks having rights of setoff, revocation, refund or chargeback with
respect to money or instruments of the Borrower or any Subsidiary on
deposit with or in the possession of such banks, (D) Liens to secure
the performance of statutory obligations, tenders, bids, leases,
progress payments, performance or return-of-money bonds, performance or
other similar bonds or other obligations of a similar nature incurred
in the ordinary course of business, (E) Liens required by any contract
or statute in order to permit the Borrower or a Subsidiary of the
Borrower to perform any contract or subcontract made by it with or
pursuant to the requirements of a governmental entity, and (F) "first
purchaser" Liens on crude oil, in each case which are not incurred in
connection with the borrowing of money, the obtaining of advances or
credit or the payment of the deferred purchase price of Property and
which do not in the aggregate impair the use of property in the
operation of the business of the Borrower and its Subsidiaries taken as
a whole;
48
(x) Liens for taxes not yet due or which are being contested
in good faith by appropriate proceedings, so long as reserves have been
established to the extent required by GAAP;
(xi) Liens on cash or cash equivalents securing obligations in
respect of Swap Contracts, the value of which collateral at any time
may not exceed $25,000,000;
(xii) any Lien granted by the Borrower or any Subsidiary on
its Receivables with regard to any ownership or security interest under
any Receivables Purchase Facility; provided that the balance of such
Receivables does not at any time exceed in the aggregate an amount
equal to the greater of (i) 5% of net sales of the Borrower and its
consolidated Subsidiaries during the four Fiscal Quarter period ending
on the last day of the most recent Fiscal Quarter for which the
Borrower has delivered financial statements pursuant to Section 6.01(a)
or (b), and (ii) $400,000,000;
(xiii) Liens on cash or cash equivalents created or existing
to secure stay or appeal bonds or otherwise resulting from any
litigation or legal proceeding which are being contested in good faith
by appropriate action promptly initiated and diligently conducted,
including the Lien of any judgment; provided, however, that the
aggregate amount secured by all such Liens does not exceed $25 million;
(xiv) any Lien granted by CRCCLP on the real estate upon which
CRCCLP's Corpus Christi refinery is located arising from the Corpus
Christi Refinery West Plant Lease;
(xv) Liens securing any extension, renewal, replacement or
refinancing of Indebtedness secured by any Lien referred to in the
foregoing clauses (i), (ii), (iii), (iv), (v), and (xiv); provided,
however, that
(A) such new Lien shall be limited to all or part of
the same property that secured the original Lien (plus
improvements on such property) and
(B) the amount secured by such Lien at such time is
not increased to any amount greater than the amount
outstanding at the time of such renewal, replacement or
refinancing;
(xvi) Liens on assets or property of the Borrower or a
Subsidiary, other than a Principal Property, in connection with
Synthetic Leases pursuant to which, for financial accounting purposes,
the Borrower or a Subsidiary is the lessee;
(xvii) Liens on cash collateral securing letter of credit
reimbursement obligations pursuant to Section 2.04(g) of the Three-Year
Credit Agreement and any renewals, extensions, amendments and
restatements thereof or created under substantially similar provisions
of any credit agreement entered into in replacement for the Three-Year
Credit Agreement; and
49
(xviii) Liens not otherwise permitted by the provisions of
this Section 7.01(a) securing indebtedness in an aggregate principal
amount at any time outstanding for the Borrower and its Subsidiaries
not in excess of 10% of Net Worth of the Borrower and its Subsidiaries;
provided, however, that such Liens do not encumber (A) the Principal
Properties, (B) any right, title or interest of the Borrower or any
Subsidiary in, to, or under any Key Contract, or (C) any shares of
capital stock or other equity interests in any Subsidiary that,
directly or indirectly either (1) owns, leases or has material contract
rights in respect of any Principal Property or (2) is a party to a Key
Contract.
No Lien pursuant to clauses (ii), (iii) or (iv) of this Section 7.01(a) (and no
Lien pursuant to clause (xv) of this Section 7.01(a) which secures refinancing,
renewal, replacement or refinancing of Indebtedness secured by any Lien referred
to in clauses (ii), (iii), or (iv)) shall cover any part of the Principal
Properties, any interest in a Key Contract or any shares of capital stock or
other equity interests in any Subsidiary that, directly or indirectly either (A)
owns, leases or has material contract rights in respect of any Principal
Property or (B) is a party to a Key Contract. No Lien pursuant to clause (v) of
this Section 7.01(a) (and no Lien pursuant to clause (xv) of this Section
7.01(a) which secures refinancing, renewal, replacement or refinancing of
Indebtedness secured by any Lien referred to in clause (v)) shall secure any
portion of a Principal Property other than the portion of the property the
acquisition of which or the construction of which was financed by the relevant
bond financing.
(b) Consolidations and Mergers; Sales of Assets. The Borrower shall
not, and shall not permit any Subsidiary to:
(i) be a party to any merger or consolidation, except that, so
long as no Default or Event of Default then exists or would exist
immediately after giving effect thereto or would result therefrom, (A)
the Borrower may merge with any other Person, provided that the
Borrower is the survivor of such merger and is a Domestic corporation,
and (B) any Wholly-Owned Subsidiary of the Borrower may merge or
consolidate into the Borrower or with or into any other Wholly-Owned
Subsidiary of the Borrower;
(ii) sell all or substantially all of the assets of the
Borrower and its Subsidiaries, taken as a whole, whether in one
transaction or a series of transactions;
(iii) sell, transfer, convey or lease the Principal Properties
other than in connection with any Permitted Lien granted thereon
pursuant to Section 7.01(a)(v) and other than the sale of all or any
portion of the Principal Properties pursuant to one or more
Dispositions permitted pursuant to clause (v) of this subsection
7.01(b);
(iv) sell, transfer, assign or convey (other than any
disposition to the Borrower or any Wholly-Owned Subsidiary) any shares
of capital stock or other equity interests in any Subsidiary that, at
the time of such sale, transfer, assignment or conveyance, directly or
indirectly either (A) owns, leases or has material contract rights in
respect of any Principal Property or (B) is a party to a Key Contract;
or
50
(v) sell, transfer, assign or convey any assets or any shares
of capital stock of or other equity interests in any Subsidiary
(collectively, a "Disposition") if, on the day on which such proposed
Disposition is to occur, the aggregate book value (at the time of the
proposed disposition thereof) of such assets, shares or equity
interests (as the case may be), when added to the aggregate book value
(at the time or times of the disposition thereof) of all other assets,
shares or equity interests disposed of by the Borrower and its
Subsidiaries under this clause (v) on or after the Closing Date exceeds
20% of the aggregate book value of the assets of the Borrower and its
Subsidiaries as of the date of the most recent balance sheet of the
Borrower delivered pursuant to Section 6.01(a) or (b); provided that,
if concurrently with any Disposition made pursuant to this clause (v)
or within one year thereof, all or substantially all of the net
proceeds of such Disposition are either
(A) reinvested (whether by acquisition, improvement,
repair, construction or otherwise) in assets related to the
business of the Borrower or any Subsidiary, or
(B) applied (1) prior to the Stated Maturity Date to
repay Loans and reduce the Aggregate Commitment (it being
understood that the Borrower will repay Loans hereunder in
such principal amount such that the aggregate principal amount
of all Loans hereunder does not exceed the Aggregate
Commitment hereunder as so reduced), and (2) subsequent to the
Stated Maturity Date, repay the amount then outstanding under
the Term Loans, or
(C) applied ratably (1) in the manner set forth in
clause (B) above and (2) to repay Loans under the Three-Year
Credit Agreement and reduce the Aggregate Commitment (as
defined in the Three-Year Credit Agreement) pursuant to the
Three-Year Credit Agreement (it being understood that the
Borrower will repay Loans and L/C Borrowings thereunder in
such principal amount as is required such that the sum of the
Outstanding Amount of all Loans thereunder, whether Committed
Loans, Swing Line Loans or Bid Loans, plus the Outstanding
Amount of all Letter of Credit Obligations outstanding after
such repayment does not exceed the Aggregate Commitment
thereunder as so reduced), or
(D) applied ratably (1) in the manner specified in
clause (B) above and (2) to repay other Indebtedness then
outstanding (other than Indebtedness which is subordinated to
the Obligations) (including Indebtedness evidenced by the
Loans made pursuant to the Three-Year Credit Agreement, the
Private Placement Notes and the Senior Notes),
then such Disposition shall be disregarded for purposes of calculations pursuant
to this clause (v) from and after the time of such reinvestment or application.
51
Nothing in this Section 7.01(b) shall prohibit the Borrower or any
Wholly-Owned Subsidiary from purchasing or otherwise acquiring the assets or
stock of any Wholly-Owned Subsidiary.
(c) Investments. The Borrower shall not, and shall not permit any
Subsidiary to, make any Investments, except:
(i) Investments held by the Borrower or such Subsidiary in the
form of cash equivalents or Short-Term Marketable Debt Securities;
(ii) advances to officers, directors and employees of the
Borrower and Subsidiaries for travel, entertainment, relocation and
analogous ordinary business purposes in accordance with law;
(iii) Investments of the Borrower in any Domestic Subsidiary
and Investments of any Subsidiary in a Domestic Subsidiary;
(iv) Investments of the Borrower and of any Subsidiary in any
Foreign Subsidiary after the Closing Date in an amount not to exceed a
cumulative amount equal to 5% of the book value consolidated assets of
the Borrower and its Subsidiaries as of the end of the most recent
Fiscal Quarter for which the Borrower has delivered financial
statements pursuant to Section 6.01(a) or (b);
(v) Investments consisting of extensions of credit by a
Subsidiary to the Borrower provided that the obligations of the
Borrower in respect of such extensions of credit must be subordinated
to the Obligations on subordination terms satisfactory to the
Administrative Agent;
(vi) Investments consisting of extensions of credit in the
nature of accounts receivable or notes receivable arising from the
granting of trade credit in the ordinary course of business, and
Investments received in satisfaction or partial satisfaction thereof
from financially troubled account debtors to the extent reasonably
necessary in order to prevent or limit loss;
(vii) Guarantees of Indebtedness of Affiliates, to the extent
permitted by Section 7.02 and, in the case of Guarantees by
Subsidiaries, to the extent permitted by Section 7.01(d);
(viii) Investments as of the Closing Date in the entities set
forth on Schedule 7.01(c);
(ix) Pass-Through Investments made after the Closing Date;
(x) Investments in LCR as follows: (A) Investments as of the
Closing Date, (B) Pass-Through Investments made after the Closing Date,
(C) Investments made after the Closing Date in an aggregate amount not
to exceed the aggregate amount of cash
52
dividends distributed after the Closing Date by LCR to the Borrower,
and (D) additional Investments not to exceed $100,000,000 in the
aggregate made after the Closing Date; and
(xi) other Investments made after the Closing Date in a
cumulative amount not to exceed 10% of the book value consolidated
assets of the Borrower and its Subsidiaries as of the end of the most
recent Fiscal Quarter for which the Borrower has delivered financial
statements pursuant to Section 6.01(a) or (b).
(d) Indebtedness, Guarantees, and Preferred Stock of Subsidiaries.
(i) The Borrower shall not permit any Subsidiary to create,
incur, assume or suffer to exist any Indebtedness or Guarantees, except
(A) Indebtedness owed to the Borrower or to a Wholly-Owned Subsidiary,
and (B) Indebtedness and Guarantees in a principal amount at any time
outstanding not to exceed five percent of Net Worth as of the end of
the most recent Fiscal Quarter for which financial statements have been
delivered or are required to be delivered pursuant to Section 6.01(a)
or (b).
(ii) The Borrower shall not permit any Subsidiary to issue any
preferred stock or other preferred Equity Interest other than preferred
stock or other preferred Equity Interest held by the Borrower or a
Wholly-Owned Subsidiary.
(e) Indebtedness of the Borrower to Subsidiaries and Affiliates.
(i) The Borrower shall not create, incur, assume or suffer to
exist any Indebtedness owed to, or any Guarantee of any obligations of
another Person owed to, a Subsidiary of or an Affiliate of the Borrower
other than (i) Permitted Affiliate Subordinated Indebtedness, and (ii)
other Indebtedness or Guarantees in an aggregate amount not to exceed
$50,000,000 principal amount outstanding at any time.
(ii) While any Default or Event of Default exists, the
Borrower will not make any principal or interest payments in respect of
Permitted Affiliate Subordinated Indebtedness or in respect of any
other Indebtedness owed to an Affiliate or to a Subsidiary of the
Borrower.
(f) Swap Contracts. The Borrower shall not, and shall not permit any
Subsidiary to, enter into Swap Contracts except in the ordinary course of
business for the purpose of directly managing risks associated with liabilities,
commitments, investments, assets, or property held or reasonably anticipated by
such Person, or changes in the value of securities issued by such Person.
(g) No Conflicts. The Borrower shall not, and shall not permit any
Subsidiary to, enter into any material agreement containing any provision which
would be violated or breached by the performance of its obligations hereunder or
under any other Loan Document or any instrument or document delivered or to be
delivered by it hereunder or thereunder or in connection herewith or therewith.
53
(h) Transactions with Affiliates. The Borrower shall not, and shall not
suffer or permit any Subsidiary to, enter into any material transaction or
series of transactions, whether or not in the ordinary course of business, with
any Affiliate other than on terms and conditions at least as favorable to the
Borrower or its Subsidiary as would be obtainable by the Borrower or such
Subsidiary at the time in a comparable arm's-length transaction with a Person
other than an Affiliate, or own, purchase or acquire any stock, obligations or
securities of, or any other interest in, or make any capital contribution to,
PDVSA or any Affiliate of PDVSA other than the Borrower or any Subsidiary;
provided, however, that nothing in this Section 7.01(h) shall be deemed to
prohibit any Affiliate Guarantee Transaction.
(i) Use of Proceeds in an Unfriendly Takeover. The Borrower shall not,
and shall not permit any Subsidiary to, use the proceeds of any Loan to purchase
or otherwise acquire any publicly owned securities of another Person (or to
refinance any indebtedness incurred for such purpose) if following such
acquisition the Borrower and its Subsidiaries would own in excess of 15% of the
Voting Stock of such Person and either (i) such purchase or acquisition is
opposed by such Person's board of directors or other governing body or by a
shareholder or shareholders controlling more than 15% of the Voting Stock of
such Person, or (ii) the Borrower knows of facts or circumstances that would
make it likely that such purchase or other acquisition would be hostile or
unfriendly.
(j) Sale Leaseback Transaction. The Borrower shall not, and shall not
permit any Subsidiary to, enter into any Sale Leaseback Transaction providing
for the sale of any portion of any Principal Property unless the book value (as
of the end of the fiscal quarter immediately preceding the date of such Sale
Leaseback Transaction) of the assets sold in connection with such Sale Leaseback
Transaction, when aggregated with the book value of all assets sold in
connection with all other Sale Leaseback Transactions pertaining to such
Principal Property, does not exceed an amount equal to 33-1/3% of the book value
of such Principal Property as of September 30, 2002. Any Sale Leaseback
Transaction permitted pursuant to the preceding sentence shall be treated as a
Disposition for purposes of Section 7.01(b)(v). The Borrower and its
Subsidiaries may enter into Sale Leaseback Transactions providing for the sale
of other assets and the leaseback of such assets to the Borrower or any
Subsidiary, provided that, any Sale Leaseback Transaction involving such a sale
shall be treated as a Disposition for purposes of Section 7.01(b)(v).
(k) Restriction on Use of Proceeds. The Borrower shall not, and shall
not allow any Subsidiary to use the proceeds of any Loan, directly or
indirectly, to make or invest in any loan or advance to, or to purchase or
acquire any obligations or securities of, PDVSA or an Affiliate of PDVSA except
for the Borrower or any Subsidiary of the Borrower.
(l) Nature of Business. The Borrower shall not, and shall not permit
any Subsidiary to, engage in any business or operations except those in which
the Borrower and its Subsidiaries are engaged on the date hereof or any related
business or operations.
(m) Restrictive Agreements. The Borrower shall not, and shall not
permit any Subsidiary to, enter into any Contractual Obligation (other than this
Agreement or any other Loan Document) that limits the ability of any Subsidiary
to pay dividends or make other
54
distributions to, or to repay loans or advances to, the Borrower, or to transfer
property to the Borrower; provided, however, that this clause (m) shall not
prohibit (i) any negative pledge incurred or provided in favor of any holder of
Liens permitted under Section 7.01(a)(iii) or (iv) solely to the extent any such
negative pledge relates to the property secured by such Liens, or (ii)
limitations on Project Financing/Special Purpose Subsidiaries, provided that the
book value of the assets of such Subsidiaries does not at any time exceed five
percent (5%) of the consolidated book value of the assets of the Borrower and
Subsidiaries.
(n) Key Contracts. The Borrower will not, and will not permit any of
its Subsidiaries to,
(i) amend, modify or waive any provision of any Key Contract
or
(ii) terminate or assign any Key Contract prior to the end of
its stated initial term,
if such amendment, modification, waiver assignment, or early termination or any
combination thereof would have a Material Adverse Effect.
7.02 FINANCIAL COVENANTS.
(a) Capitalization Ratio. The Borrower shall not permit its
Capitalization Ratio to be more than .55 to 1.00 at any time.
(b) Indebtedness Interest Coverage Ratio. The Borrower shall not permit
the ratio of (i) EBITDA for the Computation Period to (ii) Interest Expense for
the Computation Period to be less than 3.00 to 1.00 at the end of any Fiscal
Quarter.
(c) Minimum Net Worth. The Borrower shall not permit at any time Net
Worth to be less than $1,800,000,000 plus 50% of aggregate, cumulative Net
Income accruing for all Fiscal Quarters ending after June 30, 2002 for which Net
Income was positive.
ARTICLE VIII.
EVENTS OF DEFAULT
8.01 EVENT OF DEFAULT. Any of the following shall constitute an "Event
of Default":
(a) Non-Payment. The Borrower fails to pay, (i) when and as required to
be paid herein, any amount of principal of any Loan, or (ii) within 5 days after
the same becomes due, any interest, fee or any other amount payable hereunder or
under any other Loan Document; or
(b) Representation or Warranty. Any representation or warranty by the
Borrower made or deemed made herein, or in or under any other Loan Document or
in any written notice, report or certificate delivered pursuant hereto or
thereto is incorrect in any material respect on or as of the date made or deemed
made or reaffirmed, as the case may be; or
55
(c) Specific Defaults. The Borrower fails to perform or observe any
term, covenant or agreement contained in any of Section 6.03(a), Section 6.04
(with respect to the Borrower's existence), Section 6.11, Section 7.01 (other
than Section 7.01(g) and 7.01(l)) or Section 7.02; or
(d) Other Defaults. The Borrower fails to perform or observe any other
term, covenant condition or agreement contained in this Agreement or any other
Loan Document, (and not constituting an Event of Default under any other clause
of this Section 8.01) and such default shall continue unremedied for a period of
30 days; or
(e) Non-Payment of Other Indebtedness. The Borrower or any Subsidiary
(i) fails to make any payment when due (whether by scheduled maturity, required
prepayment, acceleration or otherwise) in respect of any Material Debt (whether
due by scheduled maturity, required prepayment, acceleration, demand, or
otherwise) and such failure continues after the applicable grace or notice
period, if any, specified in the relevant document on the date of such failure;
or (ii) fails to perform or observe any other condition or covenant, or any
other event shall occur or condition exist, under any agreement or instrument
relating to any Material Debt, if, in any such event, the effect of such
failure, event or condition is to cause, or to permit the holder or holders
thereof or beneficiary or beneficiaries thereof (or a trustee or agent on behalf
of such holder or holders or beneficiary or beneficiaries) to cause (after the
expiration of any applicable grace period or notice period, if any, specified in
the relevant document on the date of such failure) such Material Debt, to become
due and payable or to be repurchased, defeased or redeemed prior to its
expressed maturity; or
(f) Insolvency; Voluntary Proceedings. The Borrower or any Principal
Subsidiary (i) ceases or fails to be solvent, or generally fails to pay, or
admits in writing its inability to pay, its debts as they become due, subject to
applicable grace periods, if any; (ii) makes an assignment for the benefit of
creditors, (iii) commences any Insolvency Proceeding with respect to itself; or
(iv) takes any action to effectuate or authorize any of the foregoing; or
(g) Involuntary Proceedings. (i) Any involuntary Insolvency Proceeding
is commenced or filed against the Borrower or any Principal Subsidiary, and any
such proceeding or petition shall not be dismissed within 60 days after
commencement; (ii) the Borrower or any Principal Subsidiary admits the material
allegations of a petition against it in any Insolvency Proceeding, or an order
for relief (or similar order under non-U.S. law) is ordered in any Insolvency
Proceeding; or (iii) the Borrower or any Principal Subsidiary acquiesces in the
appointment of a receiver, trustee, custodian, liquidator or similar person for
itself or a substantial portion of its property or business; or any receiver,
trustee, custodian, liquidator or similar person is appointed without the
application or consent of the Borrower or Principal Subsidiary and the
appointment continues undischarged or unstayed for 60 calendar days;
(h) ERISA. If (i) any Reportable Event constituting grounds for the
termination of any Plan by the PBGC and the maximum amount of current liability
that may be asserted under Title IV of ERISA by reason of the termination of
such Plan and all other Plans with respect to which any such event has occurred,
shall exceed $10,000,000 or for the
56
appointment by the appropriate United States District Court of a trustee to
administer or liquidate any such Plan or Plans shall have occurred and be
continuing 30 days after written, telegraphic or telephonic notice to such
effect shall have been given to the Borrower by the PBGC and the maximum amount
of current liability that may be asserted under Title IV of ERISA by reason of
the termination of such Plan and all other Plans with respect to which any such
event has occurred, shall exceed $35,000,000, or (ii) any Plan shall be
terminated with Unfunded Vested Liabilities which could reasonably be expected
to have a Material Adverse Effect, or (iii) any contribution failure shall occur
with respect to a Plan sufficient to give rise to a Lien under Section 302(f) of
ERISA; or
(i) Material Judgments. (i) One or more non-interlocutory judgments
(including judgments entered on arbitration awards) is entered against the
Borrower or any Subsidiary involving in the aggregate liability (to the extent
not covered by independent third-party insurance as to which the insurer does
not dispute coverage or effective indemnification by a third party acceptable to
the Required Lenders) exceeding $35,000,000, or (ii) any one or more
non-monetary non-interlocutory judgments that have, or could reasonably be
expected to have, individually or in the aggregate, a Material Adverse Effect,
and, in the case of clause (i) or (ii), the same shall not have been discharged
or execution thereof stayed pending appeal for a period of 30 days after the
entry thereof, or if after the expiration of any such stay, any writ or warrant
of attachment is levied in respect of such judgment or any creditor commences
enforcement proceedings, or within 60 days after the expiration of any such stay
such judgment shall not have been discharged; or
(j) Invalidity of Loan Documents. Any Loan Document, at any time after
its execution and delivery and for any reason other than as expressly permitted
hereunder or satisfaction in full of all the Obligations, ceases to be in full
force and effect; or the Borrower or any other Person contests the validity or
enforceability of any Loan Document; or the Borrower denies that it has any or
further liability or obligation under any Loan Document, or takes action to
revoke, terminate or rescind any Loan Document; or
(k) Change of Control. There occurs any Change of Control, unless prior
written consent for such lesser percentage ownership is obtained from the
Required Lenders; or
(l) Other Material Obligations. Default in the payment when due, or in
the performance or observance of, any material obligation of, or condition
agreed to by, the Borrower or any Subsidiary with respect to any material
purchase or lease of goods or services (except only to the extent that the
existence of any such default is being contested by the Borrower or such
Subsidiary in good faith and by appropriate proceedings) if such default would
reasonably be expected to have a Material Adverse Effect; or
(m) Default of Three-Year Credit Agreement. Any Event of Default shall
occur and be continuing pursuant to the Three-Year Credit Agreement.
8.02 REMEDIES UPON EVENT OF DEFAULT. If any Event of Default occurs and
is continuing, the Administrative Agent shall, at the request of, or may, with
the consent of, the Required Lenders, take any or all of the following actions:
57
(a) declare the commitment of each Lender to make Loans to be
terminated, whereupon such commitments and obligation shall be terminated;
(b) declare the unpaid principal amount of all outstanding Loans, all
interest accrued and unpaid thereon, and all other amounts owing or payable
hereunder or under any other Loan Document to be immediately due and payable,
without presentment, demand, protest or other notice of any kind, all of which
are hereby expressly waived by the Borrower; and
(c) exercise on behalf of itself and the Lenders all rights and
remedies available to it and the Lenders under the Loan Documents or applicable
law;
provided, however, that upon the occurrence of an actual or deemed entry of an
order for relief with respect to the Borrower under the Bankruptcy Code of the
United States, the obligation of each Lender to make Loans shall automatically
terminate, the unpaid principal amount of all outstanding Loans and all interest
and other amounts as aforesaid shall automatically become due and payable, in
each case without further act of the Administrative Agent or any Lender.
8.03 APPLICATION OF FUNDS. After the exercise of remedies provided for
in Section 8.02 (or after the Loans have automatically become immediately due
and payable as set forth in the proviso to Section 8.02), any amounts received
on account of the Obligations shall be applied by the Administrative Agent in
the following order:
First, to payment of that portion of the Obligations constituting fees,
indemnities, expenses and other amounts (including Attorney Costs and amounts
payable under Article III) payable to the Administrative Agent in its capacity
as such;
Second, to payment of that portion of the Obligations constituting
fees, indemnities and other amounts (other than principal and interest) payable
to the Lenders (including Attorney Costs and amounts payable under Article III),
ratably among them in proportion to the amounts described in this clause Second
payable to them;
Third, to payment of that portion of the Obligations constituting
accrued and unpaid interest on the Loans, ratably among the Lenders in
proportion to the respective amounts described in this clause Third payable to
them;
Fourth, to payment of that portion of the Obligations constituting
unpaid principal of the Loans, ratably among the Lenders in proportion to the
respective amounts described in this clause Fourth held by them; and
Last, the balance, if any, after all of the Obligations have been
indefeasibly paid in full, to the Borrower or as otherwise required by Law.
58
ARTICLE IX.
ADMINISTRATIVE AGENT
9.01 APPOINTMENT AND AUTHORIZATION OF ADMINISTRATIVE AGENT.
Each Lender hereby irrevocably appoints, designates and authorizes the
Administrative Agent to take such action on its behalf under the provisions of
this Agreement and each other Loan Document and to exercise such powers and
perform such duties as are expressly delegated to it by the terms of this
Agreement or any other Loan Document, together with such powers as are
reasonably incidental thereto. Notwithstanding any provision to the contrary
contained elsewhere herein or in any other Loan Document, the Administrative
Agent shall not have any duties or responsibilities, except those expressly set
forth herein, nor shall the Administrative Agent have or be deemed to have any
fiduciary relationship with any Lender or participant, and no implied covenants,
functions, responsibilities, duties, obligations or liabilities shall be read
into this Agreement or any other Loan Document or otherwise exist against the
Administrative Agent. Without limiting the generality of the foregoing sentence,
the use of the term "agent" herein and in the other Loan Documents with
reference to the Administrative Agent is not intended to connote any fiduciary
or other implied (or express) obligations arising under agency doctrine of any
applicable Law. Instead, such term is used merely as a matter of market custom,
and is intended to create or reflect only an administrative relationship between
independent contracting parties.
9.02 DELEGATION OF DUTIES. The Administrative Agent may execute any of
its duties under this Agreement or any other Loan Document by or through agents,
employees or attorneys-in-fact and shall be entitled to advice of counsel and
other consultants or experts concerning all matters pertaining to such duties.
The Administrative Agent shall not be responsible for the negligence or
misconduct of any agent or attorney-in-fact that it selects in the absence of
gross negligence or willful misconduct.
9.03 LIABILITY OF ADMINISTRATIVE AGENT. No Agent-Related Person shall
(a) be liable for any action taken or omitted to be taken by any of them under
or in connection with this Agreement or any other Loan Document or the
transactions contemplated hereby (except for its own gross negligence or willful
misconduct in connection with its duties expressly set forth herein), or (b) be
responsible in any manner to any Lender or participant for any recital,
statement, representation or warranty made by the Borrower or any officer
thereof, contained herein or in any other Loan Document, or in any certificate,
report, statement or other document referred to or provided for in, or received
by the Administrative Agent under or in connection with, this Agreement or any
other Loan Document, or the validity, effectiveness, genuineness, enforceability
or sufficiency of this Agreement or any other Loan Document, or for any failure
of the Borrower or any other party to any Loan Document to perform its
obligations hereunder or thereunder. No Agent-Related Person shall be under any
obligation to any Lender or participant to ascertain or to inquire as to the
observance or performance of any of the agreements contained in, or conditions
of, this Agreement or any other Loan Document, or to inspect the properties,
books or records of the Borrower or any Affiliate thereof.
59
9.04 RELIANCE BY ADMINISTRATIVE AGENT.
(a) The Administrative Agent shall be entitled to rely, and shall be
fully protected in relying, upon any writing, communication, signature,
resolution, representation, notice, consent, certificate, affidavit, letter,
telegram, facsimile, telex or telephone message, electronic mail message,
statement or other document or conversation believed by it to be genuine and
correct and to have been signed, sent or made by the proper Person or Persons,
and upon advice and statements of legal counsel (including counsel to the
Borrower), independent accountants and other experts selected by the
Administrative Agent. The Administrative Agent shall be fully justified in
failing or refusing to take any action under any Loan Document unless it shall
first receive such advice or concurrence of the Required Lenders as it deems
appropriate and, if it so requests, it shall first be indemnified to its
satisfaction by the Lenders against any and all liability and expense which may
be incurred by it by reason of taking or continuing to take any such action. The
Administrative Agent shall in all cases be fully protected in acting, or in
refraining from acting, under this Agreement or any other Loan Document in
accordance with a request or consent of the Required Lenders (or such greater
number of Lenders as may be expressly required hereby in any instance) and such
request and any action taken or failure to act pursuant thereto shall be binding
upon all the Lenders.
(b) For purposes of determining compliance with the conditions
specified in Section 4.01, each Lender that has signed this Agreement shall be
deemed to have consented to, approved or accepted or to be satisfied with, each
document or other matter required thereunder to be consented to or approved by
or acceptable or satisfactory to a Lender unless the Administrative Agent shall
have received notice from such Lender prior to the proposed Closing Date
specifying its objection thereto.
9.05 NOTICE OF DEFAULT. The Administrative Agent shall not be deemed to
have knowledge or notice of the occurrence of any Default or Event of Default,
except with respect to defaults in the payment of principal, interest and fees
required to be paid to the Administrative Agent for the account of the Lenders,
unless the Administrative Agent shall have received written notice from a Lender
or the Borrower referring to this Agreement, describing such Default or Event of
Default and stating that such notice is a "notice of default." The
Administrative Agent will notify the Lenders of its receipt of any such notice.
The Administrative Agent shall take such action with respect to such Default or
Event of Default as may be directed by the Required Lenders in accordance with
Article VIII; provided, however, that unless and until the Administrative Agent
has received any such direction, the Administrative Agent may (but shall not be
obligated to) take such action, or refrain from taking such action, with respect
to such Default or Event of Default as it shall deem advisable or in the best
interest of the Lenders.
9.06 CREDIT DECISION; DISCLOSURE OF INFORMATION BY ADMINISTRATIVE
AGENT. Each Lender acknowledges that no Agent-Related Person has made any
representation or warranty to it, and that no act by the Administrative Agent
hereafter taken, including any consent to and acceptance of any assignment or
review of the affairs of the Borrower or any Affiliate thereof, shall be deemed
to constitute any representation or warranty by any Agent-Related Person to any
Lender as to any matter, including whether Agent-Related Persons have disclosed
material
60
information in their possession. Each Lender represents to the Administrative
Agent that it has, independently and without reliance upon any Agent-Related
Person and based on such documents and information as it has deemed appropriate,
made its own appraisal of and investigation into the business, prospects,
operations, property, financial and other condition and creditworthiness of the
Borrower and its Subsidiaries, and all applicable bank or other regulatory Laws
relating to the transactions contemplated hereby, and made its own decision to
enter into this Agreement and to extend credit to the Borrower hereunder. Each
Lender also represents that it will, independently and without reliance upon any
Agent-Related Person and based on such documents and information as it shall
deem appropriate at the time, continue to make its own credit analysis,
appraisals and decisions in taking or not taking action under this Agreement and
the other Loan Documents, and to make such investigations as it deems necessary
to inform itself as to the business, prospects, operations, property, financial
and other condition and creditworthiness of the Borrower. Except for notices,
reports and other documents expressly required to be furnished to the Lenders by
the Administrative Agent herein, the Administrative Agent shall not have any
duty or responsibility to provide any Lender with any credit or other
information concerning the business, prospects, operations, property, financial
and other condition or creditworthiness of the Borrower or any of its Affiliates
which may come into the possession of any Agent-Related Person.
9.07 INDEMNIFICATION OF ADMINISTRATIVE AGENT. Whether or not the
transactions contemplated hereby are consummated, the Lenders shall indemnify
upon demand each Agent-Related Person (to the extent not reimbursed by or on
behalf of the Borrower and without limiting the obligation of the Borrower to do
so), pro rata, and hold harmless each Agent-Related Person from and against any
and all Indemnified Liabilities incurred by it; provided, however, that no
Lender shall be liable for the payment to any Agent-Related Person of any
portion of such Indemnified Liabilities to the extent determined in a final,
nonappealable judgment by a court of competent jurisdiction to have resulted
from such Agent-Related Person's own gross negligence or willful misconduct;
provided, however, that no action taken in accordance with the directions of the
Required Lenders shall be deemed to constitute gross negligence or willful
misconduct for purposes of this Section. Without limitation of the foregoing,
each Lender shall reimburse the Administrative Agent upon demand for its ratable
share of any costs or out-of-pocket expenses (including Attorney Costs) incurred
by the Administrative Agent in connection with the preparation, execution,
delivery, administration, modification, amendment or enforcement (whether
through negotiations, legal proceedings or otherwise) of, or legal advice in
respect of rights or responsibilities under, this Agreement, any other Loan
Document, or any document contemplated by or referred to herein, to the extent
that the Administrative Agent is not reimbursed for such expenses by or on
behalf of the Borrower. The undertaking in this Section shall survive
termination of the Aggregate Commitments, the payment of all other Obligations
and the resignation of the Administrative Agent.
9.08 ADMINISTRATIVE AGENT IN ITS INDIVIDUAL CAPACITY. Bank of America
and its Affiliates may make loans to, issue letters of credit for the account
of, accept deposits from, acquire equity interests in and generally engage in
any kind of banking, trust, financial advisory, underwriting or other business
with each of the Borrower and its Affiliates as though Bank of America were not
the Administrative Agent hereunder and without notice to or consent of the
Lenders. The Lenders acknowledge that, pursuant to such activities, Bank of
America or its
61
Affiliates may receive information regarding the Borrower or its Affiliates
(including information that may be subject to confidentiality obligations in
favor of the Borrower or such Affiliate) and acknowledge that the Administrative
Agent shall be under no obligation to provide such information to them. With
respect to its Loans, Bank of America shall have the same rights and powers
under this Agreement as any other Lender and may exercise such rights and powers
as though it were not the Administrative Agent, and the terms "Lender" and
"Lenders" include Bank of America in its individual capacity.
9.09 SUCCESSOR ADMINISTRATIVE AGENT. The Administrative Agent may
resign as Administrative Agent upon 30 days' notice to the Lenders. If the
Administrative Agent resigns under this Agreement, the Required Lenders shall
appoint from among the Lenders a successor administrative agent for the Lenders,
which successor administrative agent shall be consented to by the Borrower at
all times other than during the existence of an Event of Default (which consent
of the Borrower shall not be unreasonably withheld or delayed). If no successor
administrative agent is appointed prior to the effective date of the resignation
of the Administrative Agent, the Administrative Agent may appoint, after
consulting with the Lenders and the Borrower, a successor administrative agent
from among the Lenders. Upon the acceptance of its appointment as successor
administrative agent hereunder, the Person acting as such successor
administrative agent shall succeed to all the rights, powers and duties of the
retiring Administrative Agent, and the term "Administrative Agent" shall mean
such successor administrative agent and the retiring Administrative Agent's
appointment, powers and duties as Administrative Agent shall be terminated.
After any retiring Administrative Agent's resignation hereunder as
Administrative Agent, the provisions of this Article IX and Sections 10.04 and
10.05 shall inure to its benefit as to any actions taken or omitted to be taken
by it while it was Administrative Agent under this Agreement. If no successor
administrative agent has accepted appointment as Administrative Agent by the
date which is 30 days following a retiring Administrative Agent's notice of
resignation, the retiring Administrative Agent's resignation shall nevertheless
thereupon become effective and the Lenders shall perform all of the duties of
the Administrative Agent hereunder until such time, if any, as the Required
Lenders appoint a successor agent as provided for above.
9.10 ADMINISTRATIVE AGENT MAY FILE PROOFS OF CLAIM. In case of the
pendency of any receivership, insolvency, liquidation, bankruptcy,
reorganization, arrangement, adjustment, composition or other judicial
proceeding relative to the Borrower, the Administrative Agent (irrespective of
whether the principal of any Loan shall then be due and payable as herein
expressed or by declaration or otherwise and irrespective of whether the
Administrative Agent shall have made any demand on the Borrower) shall be
entitled and empowered, by intervention in such proceeding or otherwise
(a) to file and prove a claim for the whole amount of the principal and
interest owing and unpaid in respect of the Loans, and all other Obligations
that are owing and unpaid and to file such other documents as may be necessary
or advisable in order to have the claims of the Lenders and the Administrative
Agent (including any claim for the reasonable compensation, expenses,
disbursements and advances of the Lenders and the Administrative Agent and their
respective agents and counsel and all other amounts due the Lenders and the
Administrative Agent under Sections 2.07 and 10.04) allowed in such judicial
proceeding; and
62
(b) to collect and receive any monies or other property payable or
deliverable on any such claims and to distribute the same;
and any custodian, receiver, assignee, trustee, liquidator, sequestrator or
other similar official in any such judicial proceeding is hereby authorized by
each Lender to make such payments to the Administrative Agent and, in the event
that the Administrative Agent shall consent to the making of such payments
directly to the Lenders, to pay to the Administrative Agent any amount due for
the reasonable compensation, expenses, disbursements and advances of the
Administrative Agent and its agents and counsel, and any other amounts due the
Administrative Agent under Sections 2.07 and 10.04.
Nothing contained herein shall be deemed to authorize the
Administrative Agent to authorize or consent to or accept or adopt on behalf of
any Lender any plan of reorganization, arrangement, adjustment or composition
affecting the Obligations or the rights of any Lender or to authorize the
Administrative Agent to vote in respect of the claim of any Lender in any such
proceeding.
9.11 OTHER AGENTS; ARRANGERS AND MANAGERS. None of the Lenders or other
Persons identified on the facing page or signature pages of this Agreement as a
"syndication agent," "documentation agent," "co-book manager," or "joint lead
manager" shall have any right, power, obligation, liability, responsibility or
duty under this Agreement other than, in the case of such Lenders, those
applicable to all Lenders as such. Without limiting the foregoing, none of the
Lenders or other Persons so identified shall have or be deemed to have any
fiduciary relationship with any Lender. Each Lender acknowledges that it has not
relied, and will not rely, on any of the Lenders or other Persons so identified
in deciding to enter into this Agreement or in taking or not taking action
hereunder.
ARTICLE X.
MISCELLANEOUS
10.01 AMENDMENTS, ETC. No amendment or waiver of any provision of this
Agreement or any other Loan Document, and no consent to any departure by the
Borrower therefrom, shall be effective unless in writing signed by the Required
Lenders and the Borrower, and acknowledged by the Administrative Agent, and each
such waiver or consent shall be effective only in the specific instance and for
the specific purpose for which given; provided, however, that no such amendment,
waiver or consent shall:
(a) waive any condition set forth in Section 4.01(a) without the
written consent of each Lender;
(b) extend or increase the Commitment of any Lender (or reinstate any
Commitment terminated pursuant to Section 8.02) without the written consent of
such Lender;
(c) postpone any date fixed by this Agreement or any other Loan
Document for any payment of principal, interest, fees or other amounts due to
the Lenders (or any of them)
63
hereunder or under any other Loan Document without the written consent of each
Lender directly affected thereby;
(d) reduce the principal of, or the rate of interest specified herein
on, any Loan, or (subject to clause (iii) of the second proviso to this Section
10.01) any fees or other amounts payable hereunder or under any other Loan
Document without the written consent of each Lender directly affected thereby;
provided, however, that only the consent of the Required Lenders shall be
necessary (i) to amend the definition of "Default Rate" or to waive any
obligation of the Borrower to pay interest at the Default Rate or (ii) to amend
any financial covenant hereunder (or any defined term used therein) even if the
effect of such amendment would be to reduce the rate of interest on any Loan or
to reduce any fee payable hereunder;
(e) change Section 2.11 or Section 8.03 in a manner that would alter
the pro rata sharing of payments required thereby without the written consent of
each Lender; or
(f) change any provision of this Section or the definition of "Required
Lenders" or any other provision hereof specifying the number or percentage of
Lenders required to amend, waive or otherwise modify any rights hereunder or
make any determination or grant any consent hereunder, without the written
consent of each Lender;
and, provided further, that (i) no amendment, waiver or consent shall, unless in
writing and signed by the Administrative Agent in addition to the Lenders
required above, affect the rights or duties of the Administrative Agent under
this Agreement or any other Loan Document; (ii) Section 10.07(h) may not be
amended, waived or otherwise modified without the consent of each Granting
Lender all or any part of whose Loans are being funded by an SPC at the time of
such amendment, waiver or other modification; and (iii) the Fee Letter may be
amended, or rights or privileges thereunder waived, in a writing executed only
by the parties thereto. Notwithstanding anything to the contrary herein, no
Defaulting Lender shall have any right to approve or disapprove any amendment,
waiver or consent hereunder, except that the Commitment of such Lender may not
be increased or extended without the consent of such Lender.
10.02 NOTICES AND OTHER COMMUNICATIONS; FACSIMILE COPIES.
(a) General. Unless otherwise expressly provided herein, all notices
and other communications provided for hereunder shall be in writing (including
by facsimile transmission). All such written notices shall be mailed, faxed or
delivered to the applicable address, facsimile number or (subject to subsection
(c) below) electronic mail address, and all notices and other communications
expressly permitted hereunder to be given by telephone shall be made to the
applicable telephone number, as follows:
(i) if to the Borrower or the Administrative Agent, to the
address, facsimile number, electronic mail address or telephone number
specified for such Person on Schedule 10.02 or to such other address,
facsimile number, electronic mail address or telephone number as shall
be designated by such party in a notice to the other parties; and
64
(ii) if to any other Lender, to the address, facsimile number,
electronic mail address or telephone number specified in its
Administrative Questionnaire or to such other address, facsimile
number, electronic mail address or telephone number as shall be
designated by such party in a notice to the Borrower and the
Administrative Agent.
All such notices and other communications shall be deemed to be given or made
upon the earlier to occur of (i) actual receipt by the relevant party hereto and
(ii) (A) if delivered by hand or by courier, when signed for by or on behalf of
the relevant party hereto; (B) if delivered by mail, four Business Days after
deposit in the mails, postage prepaid; (C) if delivered by facsimile, when sent
and receipt has been confirmed by telephone; and (D) if delivered by electronic
mail (which form of delivery is subject to the provisions of subsection (c)
below), when delivered; provided, however, that notices and other communications
to the Administrative Agent pursuant to Article II shall not be effective until
actually received by the Administrative Agent. In no event shall a voicemail
message be effective as a notice, communication or confirmation hereunder.
(b) Effectiveness of Facsimile Documents and Signatures. Loan Documents
may be transmitted and/or signed by facsimile. The effectiveness of any such
documents and signatures shall, subject to applicable Law, have the same force
and effect as manually-signed originals and shall be binding on the Borrower,
the Administrative Agent and the Lenders. The Administrative Agent may also
require that any such documents and signatures be confirmed by a manually-signed
original thereof; provided, however, that the failure to request or deliver the
same shall not limit the effectiveness of any facsimile document or signature.
(c) Limited Use of Electronic Mail. Electronic mail and Internet and
intranet websites may be used only to distribute routine communications, such as
financial statements and other information as provided in Section 6.02, and to
distribute Loan Documents for execution by the parties thereto, and may not be
used for any other purpose.
(d) Reliance by Administrative Agent and Lenders. The Administrative
Agent and the Lenders shall be entitled to rely and act upon any notices
(including telephonic Loan Notices) purportedly given by or on behalf of the
Borrower even if (i) such notices were not made in a manner specified herein,
were incomplete or were not preceded or followed by any other form of notice
specified herein, or (ii) the terms thereof, as understood by the recipient,
varied from any confirmation thereof. The Borrower shall indemnify each
Agent-Related Person and each Lender from all losses, costs, expenses and
liabilities resulting from the reliance by such Person on each notice
purportedly given by or on behalf of the Borrower. All telephonic notices to and
other communications with the Administrative Agent may be recorded by the
Administrative Agent, and each of the parties hereto hereby consents to such
recording.
10.03 NO WAIVER; CUMULATIVE REMEDIES. No failure by any Lender or the
Administrative Agent to exercise, and no delay by any such Person in exercising,
any right, remedy, power or privilege hereunder shall operate as a waiver
thereof; nor shall any single or partial exercise of any right, remedy, power or
privilege hereunder preclude any other or further exercise thereof or the
exercise of any other right, remedy, power or privilege. The rights,
65
remedies, powers and privileges herein provided are cumulative and not exclusive
of any rights, remedies, powers and privileges provided by law.
10.04 ATTORNEY COSTS, EXPENSES AND TAXES. The Borrower agrees (a) to
pay or reimburse the Administrative Agent for all costs and expenses incurred in
connection with the development, preparation, negotiation and execution of this
Agreement and the other Loan Documents and any amendment, waiver, consent or
other modification of the provisions hereof and thereof (whether or not the
transactions contemplated hereby or thereby are consummated), and the
consummation and administration of the transactions contemplated hereby and
thereby, including all Attorney Costs, and (b) to pay or reimburse the
Administrative Agent and each Lender for all costs and expenses incurred in
connection with the enforcement, attempted enforcement, or preservation of any
rights or remedies under this Agreement or the other Loan Documents (including
all such costs and expenses incurred during any "workout" or restructuring in
respect of the Obligations and during any legal proceeding, including any
proceeding under any Debtor Relief Law), including all Attorney Costs. The
foregoing costs and expenses shall include all search, filing, recording, title
insurance and appraisal charges and fees and taxes related thereto, and other
out-of-pocket expenses incurred by the Administrative Agent and the cost of
independent public accountants and other outside experts retained by the
Administrative Agent or any Lender. All amounts due under this Section 10.04
shall be payable within ten Business Days after demand therefor. The agreements
in this Section shall survive the termination of the Aggregate Commitments and
repayment of all other Obligations.
10.05 INDEMNIFICATION BY THE BORROWER. Whether or not the transactions
contemplated hereby are consummated, the Borrower shall indemnify and hold
harmless each Agent-Related Person, each Lender and their respective Affiliates,
directors, officers, employees, counsel, agents and attorneys-in-fact
(collectively the "Indemnitees") from and against any and all liabilities,
obligations, losses, damages, penalties, claims, demands, actions, judgments,
suits, costs, expenses and disbursements (including Attorney Costs) of any kind
or nature whatsoever which may at any time be imposed on, incurred by or
asserted against any such Indemnitee in any way relating to or arising out of or
in connection with (a) the execution, delivery, enforcement, performance or
administration of any Loan Document or any other agreement, letter or instrument
delivered in connection with the transactions contemplated thereby or the
consummation of the transactions contemplated thereby, (b) any Commitment or
Loan or the use or proposed use of the proceeds therefrom, (c) any actual or
alleged presence or release of Hazardous Materials on or from any property
currently or formerly owned or operated by the Borrower or any Subsidiary, or
any Environmental Liability related in any way to the Borrower or any
Subsidiary, or (d) any actual or prospective claim, litigation, investigation or
proceeding relating to any of the foregoing, whether based on contract, tort or
any other theory (including any investigation of, preparation for, or defense of
any pending or threatened claim, investigation, litigation or proceeding) and
regardless of whether any Indemnitee is a party thereto (all the foregoing,
collectively, the "Indemnified Liabilities"), in all cases, whether or not
caused by or arising, in whole or in part, out of the negligence of the
Indemnitee; provided that such indemnity shall not, as to any Indemnitee, be
available to the extent that such liabilities, obligations, losses, damages,
penalties, claims, demands, actions, judgments, suits, costs, expenses or
disbursements are determined by a court of competent jurisdiction by final and
nonappealable judgment to have resulted from the gross negligence or willful
misconduct of
66
such Indemnitee. No Indemnitee shall be liable for any damages arising from the
use by others of any information or other materials obtained through IntraLinks
or other similar information transmission systems in connection with this
Agreement, nor shall any Indemnitee have any liability for any indirect or
consequential damages relating to this Agreement or any other Loan Document or
arising out of its activities in connection herewith or therewith (whether
before or after the Closing Date). All amounts due under this Section 10.05
shall be payable within ten Business Days after demand therefor. The agreements
in this Section shall survive the resignation of the Administrative Agent, the
replacement of any Lender, the termination of the Aggregate Commitments and the
repayment, satisfaction or discharge of all the other Obligations.
10.06 PAYMENTS SET ASIDE. To the extent that any payment by or on
behalf of the Borrower is made to the Administrative Agent or any Lender, or the
Administrative Agent or any Lender exercises its right of set-off, and such
payment or the proceeds of such set-off or any part thereof is subsequently
invalidated, declared to be fraudulent or preferential, set aside or required
(including pursuant to any settlement entered into by the Administrative Agent
or such Lender in its discretion) to be repaid to a trustee, receiver or any
other party, in connection with any proceeding under any Debtor Relief Law or
otherwise, then (a) to the extent of such recovery, the obligation or part
thereof originally intended to be satisfied shall be revived and continued in
full force and effect as if such payment had not been made or such set-off had
not occurred, and (b) each Lender severally agrees to pay to the Administrative
Agent upon demand its applicable share of any amount so recovered from or repaid
by the Administrative Agent, plus interest thereon from the date of such demand
to the date such payment is made at a rate per annum equal to the Federal Funds
Rate from time to time in effect.
10.07 SUCCESSORS AND ASSIGNS.
(a) The provisions of this Agreement shall be binding upon and inure to
the benefit of the parties hereto and their respective successors and assigns
permitted hereby, except that the Borrower may not assign or otherwise transfer
any of its rights or obligations hereunder without the prior written consent of
each Lender and no Lender may assign or otherwise transfer any of its rights or
obligations hereunder except (i) to an Eligible Assignee in accordance with the
provisions of subsection (b) of this Section, (ii) by way of participation in
accordance with the provisions of subsection (d) of this Section, (iii) by way
of pledge or assignment of a security interest subject to the restrictions of
subsection (f) or (i) of this Section, or (iv) to an SPC in accordance with the
provisions of subsection (h) of this Section (and any other attempted assignment
or transfer by any party hereto shall be null and void). Nothing in this
Agreement, expressed or implied, shall be construed to confer upon any Person
(other than the parties hereto, their respective successors and assigns
permitted hereby, Participants to the extent provided in subsection (d) of this
Section and, to the extent expressly contemplated hereby, the Indemnitees) any
legal or equitable right, remedy or claim under or by reason of this Agreement.
(b) Any Lender may at any time assign to one or more Eligible Assignees
all or a portion of its rights and obligations under this Agreement (including
all or a portion of its Commitment and the Loans at the time owing to it);
provided that (i) except in the case of an assignment of the entire remaining
amount of the assigning Lender's Commitment and the Loans
67
at the time owing to it or in the case of an assignment to a Lender or an
Affiliate of a Lender or an Approved Fund (as defined in subsection (g) of this
Section) with respect to a Lender, the aggregate amount of the Commitment (which
for this purpose includes Loans outstanding thereunder) subject to each such
assignment, determined as of the date the Assignment and Assumption with respect
to such assignment is delivered to the Administrative Agent or, if "Trade Date"
is specified in the Assignment and Assumption, as of the Trade Date, shall not
be less than $5,000,000 unless each of the Administrative Agent and, so long as
no Event of Default has occurred and is continuing, the Borrower otherwise
consents (each such consent not to be unreasonably withheld or delayed); (ii)
each partial assignment shall be made as an assignment of a proportionate part
of all the assigning Lender's rights and obligations under this Agreement with
respect to the Loans or the Commitment assigned; (iii) any assignment of a
Commitment must be approved by the Administrative Agent unless the Person that
is the proposed assignee is itself a Lender (whether or not the proposed
assignee would otherwise qualify as an Eligible Assignee); and (iv) the parties
to each assignment shall execute and deliver to the Administrative Agent an
Assignment and Assumption, together with a processing and recordation fee of
$3,500. Subject to acceptance and recording thereof by the Administrative Agent
pursuant to subsection (c) of this Section, from and after the effective date
specified in each Assignment and Assumption, the Eligible Assignee thereunder
shall be a party to this Agreement and, to the extent of the interest assigned
by such Assignment and Assumption, have the rights and obligations of a Lender
under this Agreement, and the assigning Lender thereunder shall, to the extent
of the interest assigned by such Assignment and Assumption, be released from its
obligations under this Agreement (and, in the case of an Assignment and
Assumption covering all of the assigning Lender's rights and obligations under
this Agreement, such Lender shall cease to be a party hereto but shall continue
to be entitled to the benefits of Sections 3.01, 3.04, 3.05, 10.04 and 10.05
with respect to facts and circumstances occurring prior to the effective date of
such assignment). Upon request, the Borrower (at its expense) shall execute and
deliver a Note to the assignee Lender. Any assignment or transfer by a Lender of
rights or obligations under this Agreement that does not comply with this
subsection shall be treated for purposes of this Agreement as a sale by such
Lender of a participation in such rights and obligations in accordance with
subsection (d) of this Section.
(c) The Administrative Agent, acting solely for this purpose as an
agent of the Borrower, shall maintain at the Administrative Agent's Office a
copy of each Assignment and Assumption delivered to it and a register for the
recordation of the names and addresses of the Lenders, and the Commitments of,
and principal amounts of the Loans owing to, each Lender pursuant to the terms
hereof from time to time (the "Register"). The entries in the Register shall be
conclusive, and the Borrower, the Administrative Agent and the Lenders may treat
each Person whose name is recorded in the Register pursuant to the terms hereof
as a Lender hereunder for all purposes of this Agreement, notwithstanding notice
to the contrary. The Register shall be available for inspection by the Borrower
and any Lender, at any reasonable time and from time to time upon reasonable
prior notice.
(d) Any Lender may at any time, without the consent of, or notice to,
the Borrower or the Administrative Agent, sell participations to any Person
(other than a natural person or the Borrower or any of the Borrower's Affiliates
or Subsidiaries) (each, a "Participant") in all or a portion of such Lender's
rights and/or obligations under this Agreement (including all or a
68
portion of its Commitment and/or the Loans owing to it); provided that (i) such
Lender's obligations under this Agreement shall remain unchanged, (ii) such
Lender shall remain solely responsible to the other parties hereto for the
performance of such obligations and (iii) the Borrower, the Administrative Agent
and the other Lenders shall continue to deal solely and directly with such
Lender in connection with such Lender's rights and obligations under this
Agreement. Any agreement or instrument pursuant to which a Lender sells such a
participation shall provide that such Lender shall retain the sole right to
enforce this Agreement and to approve any amendment, modification or waiver of
any provision of this Agreement; provided that such agreement or instrument may
provide that such Lender will not, without the consent of the Participant, agree
to any amendment, waiver or other modification described in the first proviso to
Section 10.01 that directly affects such Participant. Subject to subsection (e)
of this Section, the Borrower agrees that each Participant shall be entitled to
the benefits of Sections 3.01, 3.04 and 3.05 to the same extent as if it were a
Lender and had acquired its interest by assignment pursuant to subsection (b) of
this Section. To the extent permitted by law, each Participant also shall be
entitled to the benefits of Section 10.09 as though it were a Lender, provided
such Participant agrees to be subject to Section 2.11 as though it were a
Lender.
(e) A Participant shall not be entitled to receive any greater payment
under Section 3.01 or 3.04 than the applicable Lender would have been entitled
to receive with respect to the participation sold to such Participant, unless
the sale of the participation to such Participant is made with the Borrower's
prior written consent. A Participant that would be a Foreign Lender if it were a
Lender shall not be entitled to the benefits of Section 3.01 unless the Borrower
is notified of the participation sold to such Participant and such Participant
agrees, for the benefit of the Borrower, to comply with Section 10.15 as though
it were a Lender.
(f) Any Lender may at any time pledge or assign a security interest in
all or any portion of its rights under this Agreement (including under its Note,
if any) to secure obligations of such Lender, including any pledge or assignment
to secure obligations to a Federal Reserve Bank; provided that no such pledge or
assignment shall release such Lender from any of its obligations hereunder or
substitute any such pledgee or assignee for such Lender as a party hereto.
(g) As used herein, the following terms have the following meanings:
"Eligible Assignee" means (a) a Lender; (b) an Affiliate of a
Lender; (c) an Approved Fund; and (d) any other Person (other than a
natural person) approved by (i) the Administrative Agent, and (ii)
unless an Event of Default has occurred and is continuing, the Borrower
(each such approval not to be unreasonably withheld or delayed);
provided that notwithstanding the foregoing, "Eligible Assignee" shall
not include the Borrower or any of the Borrower's Affiliates or
Subsidiaries.
"Fund" means any Person (other than a natural person) that is
(or will be) engaged in making, purchasing, holding or otherwise
investing in commercial loans and similar extensions of credit in the
ordinary course of its business.
69
"Approved Fund" means any Fund that is administered or managed
by (a) a Lender, (b) an Affiliate of a Lender or (c) an entity or an
Affiliate of an entity that administers or manages a Lender.
(h) Notwithstanding anything to the contrary contained herein, any
Lender (a "Granting Lender") may grant to a special purpose funding vehicle
identified as such in writing from time to time by the Granting Lender to the
Administrative Agent and the Borrower (an "SPC") the option to provide all or
any part of any Loan that such Granting Lender would otherwise be obligated to
make pursuant to this Agreement; provided that (i) nothing herein shall
constitute a commitment by any SPC to fund any Loan, and (ii) if an SPC elects
not to exercise such option or otherwise fails to make all or any part of such
Loan, the Granting Lender shall be obligated to make such Loan pursuant to the
terms hereof. Each party hereto hereby agrees that (i) neither the grant to any
SPC nor the exercise by any SPC of such option shall increase the costs or
expenses or otherwise increase or change the obligations of the Borrower under
this Agreement (including its obligations under Section 3.04), (ii) no SPC shall
be liable for any indemnity or similar payment obligation under this Agreement
for which a Lender would be liable, and (iii) the Granting Lender shall for all
purposes, including the approval of any amendment, waiver or other modification
of any provision of any Loan Document, remain the lender of record hereunder.
The making of a Loan by an SPC hereunder shall utilize the Commitment of the
Granting Lender to the same extent, and as if, such Loan were made by such
Granting Lender. In furtherance of the foregoing, each party hereto hereby
agrees (which agreement shall survive the termination of this Agreement) that,
prior to the date that is one year and one day after the payment in full of all
outstanding commercial paper or other senior debt of any SPC, it will not
institute against, or join any other Person in instituting against, such SPC any
bankruptcy, reorganization, arrangement, insolvency, or liquidation proceeding
under the laws of the United States or any State thereof. Notwithstanding
anything to the contrary contained herein, any SPC may (i) with notice to, but
without prior consent of the Borrower and the Administrative Agent and with the
payment of a processing fee of $3,500, assign all or any portion of its right to
receive payment with respect to any Loan to the Granting Lender and (ii)
disclose on a confidential basis any non-public information relating to its
funding of Loans to any rating agency, commercial paper dealer or provider of
any surety or Guarantee or credit or liquidity enhancement to such SPC.
(i) Notwithstanding anything to the contrary contained herein, any
Lender that is a Fund may create a security interest in all or any portion of
the Loans owing to it and the Note, if any, held by it to the trustee for
holders of obligations owed, or securities issued, by such Fund as security for
such obligations or securities, provided that unless and until such trustee
actually becomes a Lender in compliance with the other provisions of this
Section 10.07, (i) no such pledge shall release the pledging Lender from any of
its obligations under the Loan Documents and (ii) such trustee shall not be
entitled to exercise any of the rights of a Lender under the Loan Documents even
though such trustee may have acquired ownership rights with respect to the
pledged interest through foreclosure or otherwise.
10.08 CONFIDENTIALITY. Each of the Administrative Agent and the Lenders
agrees to maintain the confidentiality of the Information (as defined below),
except that Information may be disclosed (a) to its and its Affiliates'
directors, officers, employees and agents, including
70
accountants, legal counsel and other advisors (it being understood that the
Persons to whom such disclosure is made will be informed of the confidential
nature of such Information and instructed to keep such Information
confidential); (b) to the extent requested by any regulatory authority; (c) to
the extent required by applicable laws or regulations or by any subpoena or
similar legal process; (d) to any other party to this Agreement; (e) in
connection with the exercise of any remedies hereunder or any suit, action or
proceeding relating to this Agreement or the enforcement of rights hereunder;
(f) subject to an agreement containing provisions substantially the same as
those of this Section, to (i) any Eligible Assignee of or Participant in, or any
prospective Eligible Assignee of or Participant in, any of its rights or
obligations under this Agreement or (ii) any direct or indirect contractual
counterparty or prospective counterparty (or such contractual counterparty's or
prospective counterparty's professional advisor) to any credit derivative
transaction relating to obligations of the Borrower; (g) with the consent of the
Borrower; (h) to the extent such Information (i) becomes publicly available
other than as a result of a breach of this Section or (ii) becomes available to
the Administrative Agent or any Lender on a nonconfidential basis from a source
other than the Borrower; or (i) to the National Association of Insurance
Commissioners or any other similar organization. In addition, the Administrative
Agent and the Lenders may disclose the existence of this Agreement and
information about this Agreement to market data collectors, similar service
providers to the lending industry, and service providers to the Administrative
Agent and the Lenders in connection with the administration and management of
this Agreement, the other Loan Documents, the Commitments, and the Borrowings.
For the purposes of this Section, "Information" means all information received
from the Borrower relating to the Borrower or its business, other than any such
information that is available to the Administrative Agent or any Lender on a
nonconfidential basis prior to disclosure by the Borrower; provided that, in the
case of information received from the Borrower after the date hereof, such
information is clearly identified in writing at the time of delivery as
confidential. Any Person required to maintain the confidentiality of Information
as provided in this Section shall be considered to have complied with its
obligation to do so if such Person has exercised the same degree of care to
maintain the confidentiality of such Information as such Person would accord to
its own confidential information.
10.09 SET-OFF. In addition to any rights and remedies of the Lenders
provided by law, upon the occurrence and during the continuance of any Event of
Default, each Lender is authorized at any time and from time to time, without
prior notice to the Borrower, any such notice being waived by the Borrower to
the fullest extent permitted by law, to set off and apply any and all deposits
(general or special, time or demand, provisional or final) at any time held by,
and other indebtedness at any time owing by, such Lender to or for the credit or
the account of the Borrower against any and all Obligations owing to such Lender
hereunder or under any other Loan Document, now or hereafter existing,
irrespective of whether or not the Administrative Agent or such Lender shall
have made demand under this Agreement or any other Loan Document and although
such Obligations may be contingent or unmatured or denominated in a currency
different from that of the applicable deposit or indebtedness. Each Lender
agrees promptly to notify the Borrower and the Administrative Agent after any
such set-off and application made by such Lender; provided, however, that the
failure to give such notice shall not affect the validity of such set-off and
application.
71
10.10 INTEREST RATE LIMITATION. Notwithstanding anything to the
contrary contained in any Loan Document, the interest paid or agreed to be paid
under the Loan Documents shall not exceed the maximum rate of non-usurious
interest permitted by applicable Law (the "Maximum Rate"). If the Administrative
Agent or any Lender shall receive interest in an amount that exceeds the Maximum
Rate, the excess interest shall be applied to the principal of the Loans or, if
it exceeds such unpaid principal, refunded to the Borrower. In determining
whether the interest contracted for, charged, or received by the Administrative
Agent or a Lender exceeds the Maximum Rate, such Person may, to the extent
permitted by applicable Law, (a) characterize any payment that is not principal
as an expense, fee, or premium rather than interest, (b) exclude voluntary
prepayments and the effects thereof, and (c) amortize, prorate, allocate, and
spread in equal or unequal parts the total amount of interest throughout the
contemplated term of the Obligations hereunder.
10.11 COUNTERPARTS. This Agreement may be executed in one or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
10.12 INTEGRATION. This Agreement, together with the other Loan
Documents, comprises the complete and integrated agreement of the parties on the
subject matter hereof and thereof and supersedes all prior agreements, written
or oral, on such subject matter. In the event of any conflict between the
provisions of this Agreement and those of any other Loan Document, the
provisions of this Agreement shall control; provided that the inclusion of
supplemental rights or remedies in favor of the Administrative Agent or the
Lenders in any other Loan Document shall not be deemed a conflict with this
Agreement. Each Loan Document was drafted with the joint participation of the
respective parties thereto and shall be construed neither against nor in favor
of any party, but rather in accordance with the fair meaning thereof.
10.13 SURVIVAL OF REPRESENTATIONS AND WARRANTIES. All representations
and warranties made hereunder and in any other Loan Document or other document
delivered pursuant hereto or thereto or in connection herewith or therewith
shall survive the execution and delivery hereof and thereof. Such
representations and warranties have been or will be relied upon by the
Administrative Agent and each Lender, regardless of any investigation made by
the Administrative Agent or any Lender or on their behalf and notwithstanding
that the Administrative Agent or any Lender may have had notice or knowledge of
any Default or Event of Default at the time of any Borrowing, and shall continue
in full force and effect as long as any Loan or any other Obligation hereunder
shall remain unpaid or unsatisfied.
10.14 SEVERABILITY. If any provision of this Agreement or the other
Loan Documents is held to be illegal, invalid or unenforceable, (a) the
legality, validity and enforceability of the remaining provisions of this
Agreement and the other Loan Documents shall not be affected or impaired thereby
and (b) the parties shall endeavor in good faith negotiations to replace the
illegal, invalid or unenforceable provisions with valid provisions the economic
effect of which comes as close as possible to that of the illegal, invalid or
unenforceable provisions. The invalidity of a provision in a particular
jurisdiction shall not invalidate or render unenforceable such provision in any
other jurisdiction.
72
10.15 TAX FORMS. (a) (i) Each Lender that is not a "United States
person" within the meaning of Section 7701(a)(30) of the Code (a "Foreign
Lender") shall deliver to the Administrative Agent, prior to receipt of any
payment subject to withholding under the Code (or upon accepting an assignment
of an interest herein), two duly signed completed copies of either IRS Form
W-8BEN or any successor thereto (relating to such Foreign Lender and entitling
it to an exemption from, or reduction of, withholding tax on all payments to be
made to such Foreign Lender by the Borrower pursuant to this Agreement) or IRS
Form W-8ECI or any successor thereto (relating to all payments to be made to
such Foreign Lender by the Borrower pursuant to this Agreement) or such other
evidence satisfactory to the Borrower and the Administrative Agent that such
Foreign Lender is entitled to an exemption from, or reduction of, U.S.
withholding tax, including any exemption pursuant to Section 881(c) of the Code.
Thereafter and from time to time, each such Foreign Lender shall (A) promptly
submit to the Administrative Agent such additional duly completed and signed
copies of one of such forms (or such successor forms as shall be adopted from
time to time by the relevant United States taxing authorities) as may then be
available under then current United States laws and regulations to avoid, or
such evidence as is satisfactory to the Borrower and the Administrative Agent of
any available exemption from or reduction of, United States withholding taxes in
respect of all payments to be made to such Foreign Lender by the Borrower
pursuant to this Agreement, (B) promptly notify the Administrative Agent of any
change in circumstances which would modify or render invalid any claimed
exemption or reduction, and (C) take such steps as shall not be materially
disadvantageous to it, in the reasonable judgment of such Lender, and as may be
reasonably necessary (including the re-designation of its Lending Office) to
avoid any requirement of applicable Laws that the Borrower make any deduction or
withholding for taxes from amounts payable to such Foreign Lender.
(ii) Each Foreign Lender, to the extent it does not act or ceases to
act for its own account with respect to any portion of any sums paid or payable
to such Lender under any of the Loan Documents (for example, in the case of a
typical participation by such Lender), shall deliver to the Administrative Agent
on the date when such Foreign Lender ceases to act for its own account with
respect to any portion of any such sums paid or payable, and at such other times
as may be necessary in the determination of the Administrative Agent (in the
reasonable exercise of its discretion), (A) two duly signed completed copies of
the forms or statements required to be provided by such Lender as set forth
above, to establish the portion of any such sums paid or payable with respect to
which such Lender acts for its own account that is not subject to U.S.
withholding tax, and (B) two duly signed completed copies of IRS Form W-8IMY (or
any successor thereto), together with any information such Lender chooses to
transmit with such form, and any other certificate or statement of exemption
required under the Code, to establish that such Lender is not acting for its own
account with respect to a portion of any such sums payable to such Lender.
(iii) The Borrower shall not be required to pay any additional amount
to any Foreign Lender under Section 3.01 (A) with respect to any Taxes required
to be deducted or withheld on the basis of the information, certificates or
statements of exemption such Lender transmits with an IRS Form W-8IMY pursuant
to this Section 10.15(a) or (B) if such Lender shall have failed to satisfy the
foregoing provisions of this Section 10.15(a); provided that if such Lender
shall have satisfied the requirement of this Section 10.15(a) on the date such
Lender became a Lender or
73
ceased to act for its own account with respect to any payment under any of the
Loan Documents, nothing in this Section 10.15(a) shall relieve the Borrower of
its obligation to pay any amounts pursuant to Section 3.01 in the event that, as
a result of any change in any applicable law, treaty or governmental rule,
regulation or order, or any change in the interpretation, administration or
application thereof, such Lender is no longer properly entitled to deliver
forms, certificates or other evidence at a subsequent date establishing the fact
that such Lender or other Person for the account of which such Lender receives
any sums payable under any of the Loan Documents is not subject to withholding
or is subject to withholding at a reduced rate.
(iv) The Administrative Agent may, without reduction, withhold any
Taxes required to be deducted and withheld from any payment under any of the
Loan Documents with respect to which the Borrower is not required to pay
additional amounts under this Section 10.15(a).
(b) Upon the request of the Administrative Agent, each Lender that is a
"United States person" within the meaning of Section 7701(a)(30) of the Code
shall deliver to the Administrative Agent two duly signed completed copies of
IRS Form W-9. If such Lender fails to deliver such forms, then the
Administrative Agent may withhold from any interest payment to such Lender an
amount equivalent to the applicable back-up withholding tax imposed by the Code,
without reduction.
(c) If any Governmental Authority asserts that the Administrative Agent
did not properly withhold or backup withhold, as the case may be, any tax or
other amount from payments made to or for the account of any Lender, such Lender
shall indemnify the Administrative Agent therefore, including all penalties and
interest, any taxes imposed by any jurisdiction on the amounts payable to the
Administrative Agent under this Section, and costs and expenses (including
Attorney Costs) of the Administrative Agent. The obligation of the Lenders under
this Section shall survive the termination of the Aggregate Commitments,
repayment of all other Obligations hereunder and the resignation of the
Administrative Agent.
10.16 REPLACEMENT OF LENDERS. Under any circumstances set forth herein
providing that the Borrower shall have the right to replace a Lender as a party
to this Agreement, the Borrower may, upon notice to such Lender and the
Administrative Agent, replace such Lender by causing such Lender to assign its
Commitment (with the assignment fee to be paid by the Borrower in such instance)
pursuant to Section 10.07(b) to one or more other Lenders or Eligible Assignees
procured by the Borrower; provided, however, that if the Borrower elects to
exercise such right with respect to any Lender pursuant to Section 3.06(b) or
Section 3.06(c), it shall be obligated to replace all Lenders that have made
similar requests for compensation pursuant to Section 3.01 or 3.04, or made
similar determinations of illegality pursuant to Section 3.02 and failed to cure
such illegality by designating a different Lending Office. The Borrower shall
(x) pay in full all principal, interest, fees and other amounts owing to such
Lender through the date of replacement (including any amounts payable pursuant
to Section 3.05), and (y) release such Lender from its obligations under the
Loan Documents. Any Lender being replaced shall execute and deliver an
Assignment and Assumption with respect to such Lender's Commitment and
outstanding Loans.
74
10.17 GOVERNING LAW.
(a) THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE
WITH, the LAW OF THE STATE OF
NEW YORK applicable to agreements made and to be
performed entirely within such State; PROVIDED THAT THE ADMINISTRATIVE Agent AND
EACH LENDER SHALL RETAIN ALL RIGHTS ARISING UNDER FEDERAL LAW.
(b) ANY LEGAL ACTION OR PROCEEDING WITH RESPECT TO THIS AGREEMENT OR
ANY OTHER LOAN DOCUMENT MAY BE BROUGHT IN XXX XXXXXX XX XXX XXXXX XX XXX XXXX
SITTING IN THE BOROUGH OF MANHATTAN OR OF THE UNITED STATES FOR THE SOUTHERN
DISTRICT OF
NEW YORK, AND BY EXECUTION AND DELIVERY OF THIS AGREEMENT, THE
BORROWER, THE ADMINISTRATIVE AGENT AND EACH LENDER CONSENTS, FOR ITSELF AND IN
RESPECT OF ITS PROPERTY, TO THE NON-EXCLUSIVE JURISDICTION OF THOSE COURTS. THE
BORROWER, THE ADMINISTRATIVE AGENT AND EACH LENDER IRREVOCABLY WAIVES ANY
OBJECTION, INCLUDING ANY OBJECTION TO THE LAYING OF VENUE OR BASED ON THE
GROUNDS OF FORUM NON CONVENIENS, WHICH IT MAY NOW OR HEREAFTER HAVE TO THE
BRINGING OF ANY ACTION OR PROCEEDING IN SUCH JURISDICTION IN RESPECT OF ANY LOAN
DOCUMENT OR OTHER DOCUMENT RELATED THERETO. THE BORROWER, THE ADMINISTRATIVE
AGENT AND EACH LENDER WAIVES PERSONAL SERVICE OF ANY SUMMONS, COMPLAINT OR OTHER
PROCESS, WHICH MAY BE MADE BY ANY OTHER MEANS PERMITTED BY THE LAW OF SUCH
STATE.
10.18 WAIVER OF RIGHT TO TRIAL BY JURY. EACH PARTY TO THIS AGREEMENT
HEREBY EXPRESSLY WAIVES ANY RIGHT TO TRIAL BY JURY OF ANY CLAIM, DEMAND, ACTION
OR CAUSE OF ACTION ARISING UNDER ANY LOAN DOCUMENT OR IN ANY WAY CONNECTED WITH
OR RELATED OR INCIDENTAL TO THE DEALINGS OF THE PARTIES HERETO OR ANY OF THEM
WITH RESPECT TO ANY LOAN DOCUMENT, OR THE TRANSACTIONS RELATED THERETO, IN EACH
CASE WHETHER NOW EXISTING OR HEREAFTER ARISING, AND WHETHER FOUNDED IN CONTRACT
OR TORT OR OTHERWISE; AND EACH PARTY HEREBY AGREES AND CONSENTS THAT ANY SUCH
CLAIM, DEMAND, ACTION OR CAUSE OF ACTION SHALL BE DECIDED BY COURT TRIAL WITHOUT
A JURY, AND THAT ANY PARTY TO THIS AGREEMENT MAY FILE AN ORIGINAL COUNTERPART OR
A COPY OF THIS SECTION WITH ANY COURT AS WRITTEN EVIDENCE OF THE CONSENT OF THE
SIGNATORIES HERETO TO THE WAIVER OF THEIR RIGHT TO TRIAL BY JURY.
10.19 TERMINATION OF COMMITMENTS UNDER EXISTING CREDIT AGREEMENTS. The
commitments of the lenders under the Existing Credit Agreements shall terminate
on the Closing Date. Execution of this Agreement by Lenders who are parties to
the Amended and Restated Credit Agreement dated as of May 7, 2002 (the "Existing
364-Day Credit Agreement") shall constitute a waiver of the notice provisions in
Sections 2.5 and 2.6 the Existing 364-Credit Agreement. Execution by Lenders who
are parties to the $400,000,000 Credit Agreement dated
75
as of May 13, 1998 (the "Existing Multi-Year Credit Agreement") shall constitute
a waiver of the notice provisions in Sections 2.8 and 2.9 of the Existing
Multi-Year Credit Agreement.
10.20 ENTIRE AGREEMENT. THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS
REPRESENT THE FINAL AGREEMENT AMONG THE PARTIES AND MAY NOT BE CONTRADICTED BY
EVIDENCE OF PRIOR, CONTEMPORANEOUS, OR SUBSEQUENT ORAL AGREEMENTS OF THE
PARTIES. THERE ARE NO UNWRITTEN ORAL AGREEMENTS AMONG THE PARTIES.
76
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed as of the date first above written.
CITGO PETROLEUM CORPORATION
By: /s/ XXXXX X. XXXXXXXX
------------------------------------------------
Name: Xxxxx X. Xxxxxxxx
----------------------------------------------
Title: Senior Vice President Finance Administration
--------------------------------------------
and Chief Financial Officer
--------------------------------------------
S-1
BANK OF AMERICA, N.A.,
as Administrative Agent
By: /s/ XXXXXX XXX
------------------------------
Xxxxxx X. Xxx
Managing Director
S-2
BANK OF AMERICA, N.A.,
as a Lender
By: /s/ XXXXXX XXX
------------------------------
Xxxxxx X. Xxx
Managing Director
S-3
JPMORGAN CHASE BANK,
as Syndication Agent and as a Lender
By: /s/ XXXXXX X. XXXXXXXXXXX
--------------------------------
Name: Xxxxxx X. Xxxxxxxxxxx
-----------------------------
Title: Managing Director
-----------------------------
S-4
SOCIETE GENERALE,
as Documentation Agent and as a Lender
By: /s/ XXXXXXX X. XXXXX
----------------------------------------
Name: Xxxxxxx X. Xxxxx
--------------------------------------
Title: Vice President
-------------------------------------
S-5
THE BANK OF
NEW YORK,
as a Lender
By: /s/ XXXXXXX X. XXXXXX
----------------------------------------
Name: Xxxxxxx X. Xxxxxx
--------------------------------------
Title: Vice President
-------------------------------------
S-6
MIZUHO CORPORATE BANK, LTD.,
as a Lender
By: /s/ XXXXXXX XXXXXXX
--------------------------------------------
Name: Xxxxxxx Xxxxxxx
------------------------------------------
Title: Senior Vice President & Manager
-----------------------------------------
S-7
SUNTRUST BANK,
as a Lender
By: /s/ XXXXXX X. XXXXXXXX
--------------------------------------------
Name: Xxxxxx X. XxXxxxxx
------------------------------------------
Title: Vice President
-----------------------------------------
S-8
FLEET NATIONAL BANK,
as a Lender
By: /s/ XXXXXX X. XXXXXXXXXX
-----------------------------------------
Name: Xxxxxx X. Xxxxxxxxxx
---------------------------------------
Title: Director
--------------------------------------
S-9
BNP PARIBAS,
as a Lender
By: /s/ XXXXX XXXXXXXX
-----------------------------------------
Name: Xxxxx Xxxxxxxx
---------------------------------------
Title: Vice President
--------------------------------------
By: /s/ XXXXXX X. XXXXXXXX
-----------------------------------------
Name: Xxxxxx X. Xxxxxxxx
---------------------------------------
Title: Managing Director
--------------------------------------
X-00
XXX XXXXX XXXX XX XXXXXXXX PLC,
as a Lender
By: /s/ XXXXX XXXXXXX
---------------------------------------------
Name: Xxxxx Xxxxxxx
-------------------------------------------
Title: Senior Vice President
------------------------------------------
S-11
BANK ONE, N.A. (Main Office - Chicago),
as a Lender
By: /s/ XXXXXX X. XXXXX
-----------------------------------------
Name: Xxxxxx X. Xxxxx
---------------------------------------
Title: Director
--------------------------------------
X-00
XXXXXX XX, XXX XXXX BRANCH,
as a Lender
By: /s/ XXXXXXXXX XXXXXXXXXX
-----------------------------------------
Name: Xxxxxxxxx Xxxxxxxxxx
---------------------------------------
Title: Managing Director
--------------------------------------
By: /s/ XXXXXX XXXXXXXXX
-----------------------------------------
Name: Xxxxxx Xxxxxxxxx
---------------------------------------
Title: Associate Director
--------------------------------------
S-13
BANK OF OKLAHOMA, NATIONAL ASSOCIATION,
as a Lender
By: /s/ XXXXXX X. XXXXXX
-----------------------------------------
Name: Xxxxxx X. Xxxxxx
---------------------------------------
Title: Senior Vice President
--------------------------------------
S-14
THE NORTHERN TRUST COMPANY,
as a Lender
By: /s/ XXXXXXX X. XXXXXXX
-----------------------------------------
Name: Xxxxxxx X. Xxxxxxx
---------------------------------------
Title: Vice President
--------------------------------------
S-15
