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EXHIBIT 10.1
FIRST AMENDED AND RESTATED
CREDIT AGREEMENT
DATED AS OF MAY 31, 1999
BETWEEN AND AMONG
HERITAGE OPERATING, L.P.,
A DELAWARE LIMITED PARTNERSHIP
"BORROWER"
AND
BANK OF OKLAHOMA, NATIONAL ASSOCIATION,
MERCANTILE BANK NATIONAL ASSOCIATION,
AND
LOCAL OKLAHOMA BANK, N.A.
"BANKS"
AND
BANK OF OKLAHOMA, NATIONAL ASSOCIATION
AS "ADMINISTRATIVE AGENT" FOR THE BANKS,
AND
MERCANTILE BANK NATIONAL ASSOCIATION
AS "CO-AGENT" FOR THE BANKS
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TABLE OF CONTENTS
ARTICLE I DEFINITIONS; ACCOUNTING PRINCIPLES,
TERMS AND DEFINITIONS; CONSTRUCTION........................................................ 1
1.1 Definitions....................................................................... 1
1.2 Accounting Principles, Terms and Determinations................................... 19
1.3 Construction...................................................................... 19
ARTICLE II THE CREDITS................................................................................ 20
2.1 Acquisition Facility.............................................................. 20
2.1.1 Acquisition Loan......................................................... 20
2.1.2 Maximum Amount of Acquisition Credit................................... 20
2.1.3 Acquisition Loan Borrowing Requests...................................... 20
2.1.4 Acquisition Loan Account: Acquisition Notes.............................. 20
2.2 Working Capital Facility.......................................................... 21
2.2.1 Working Capital Loan..................................................... 21
2.2.2 Maximum Amount of Working Capital Credit ................................ 21
2.2.3 Working Capital Borrowing Requests....................................... 21
2.2.4 Working Capital Loan Account: Working Capital Notes...................... 21
2.3 Letters of Credit................................................................. 21
2.3.1 Issuance of Letters of Credit............................................ 21
2.3.2 Requests for Letters of Credit........................................... 22
2.3.3 Form and Expiration of Letters of Credit................................. 22
2.3.4 Banks' Participation in Letters of Credit................................ 22
2.3.5 Presentation............................................................. 22
2.3.6 Payment of Drafts........................................................ 22
2.3.7 Uniform Customs and Practice............................................. 22
2.3.8 Subrogation.............................................................. 23
2.3.9 Modification, Consent, etc............................................... 24
2.4 Application of Proceeds........................................................... 24
2.4.1 Acquisition Loan......................................................... 24
2.4.2 Working Capital Loan..................................................... 24
2.4.3 Letters of Credit........................................................ 24
2.4.4 Specifically Prohibited Applications..................................... 24
2.5 Nature of Obligations of Banks to Make Extensions of Credit....................... 24
ARTICLE III INTEREST; EURODOLLAR PRICING OPTIONS; FEES................................................. 24
3.1 Interest.......................................................................... 24
3.2 Eurodollar Pricing Options........................................................ 25
3.2.1 Election of Eurodollar Pricing Options................................... 25
3.2.2 Notice to Banks and Borrower............................................. 25
3.2.3 Selection of Eurodollar Interest Periods................................. 25
3.2.4 Additional Interest...................................................... 25
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3.2.5 Violation of Bank Legal Requirements...................................... 26
3.2.6 Funding Procedure......................................................... 26
3.3 Commitment Fees.................................................................... 26
3.3.1 Acquisition Financing Facility............................................ 26
3.3.2 Working Capital Facility.................................................. 26
3.4 Letter of Credit Fees.............................................................. 27
3.5 Reserve Requirements, etc.......................................................... 27
3.6 Taxes.............................................................................. 27
3.7 Capital Adequacy................................................................... 28
3.8 Regulatory Changes................................................................. 28
3.9 Computations of Interest and Fees.................................................. 28
3.10 Administrative Agent's Fees........................................................ 28
3.11 Co-Agent's Fees.................................................................... 28
ARTICLE IV PAYMENT..................................................................................... 29
4.1 Payment at Maturity................................................................ 29
4.2 Contingent Required Prepayments.................................................... 29
4.2.1 Excess Credit Exposure.................................................... 29
4.2.2 Letter of Credit Exposure................................................. 29
4.2.3 Contingent Prepayments on Disposition, Loss of Assets,
Merger or Change of Control............................................... 29
4.2.4 Prepayment Procedure for Contingent Prepayments........................... 30
4.3 Scheduled Required Payments/Prepayments............................................ 30
4.3.1 Payments on the Acquisition Loan.......................................... 30
4.3.2 Working Capital Loan...................................................... 30
4.4 Voluntary Prepayments.............................................................. 30
4.5 Letters of Credit.................................................................. 30
4.6 Reborrowing Application of Payments, etc........................................... 31
4.6.1 Reborrowing............................................................... 31
4.6.2 Order of Application...................................................... 31
4.6.3 Payment with Accrued Interest, etc........................................ 31
4.6.4 Payments for Banks........................................................ 31
ARTICLE V SECURITY.................................................................................... 31
5.1 Collateral......................................................................... 31
5.2 Intercreditor Agreement............................................................ 31
ARTICLE VI CONDITIONS PRECEDENT AND SUBSEQUENT TO LOANS................................................ 32
6.1 Conditions Precedent to Initial Working Capital Loan and Initial
Acquisition Loan................................................................... 32
(i) No Default................................................................ 32
(ii) Representations and Warranties............................................ 32
(iii) Certificates.............................................................. 32
(iv) Proceedings............................................................... 32
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(v) Notes..................................................................... 32
(vi) Security Agreement........................................................ 32
(vii) Opinions of Borrower's Counsel............................................ 32
(viii) UCC Releases/Other Information............................................ 33
(ix) Other Information and Closing Documents................................... 33
(x) Assignments/Replacement of BankBoston..................................... 33
6.2 Conditions Precedent to All Loans.................................................. 33
ARTICLE VII COVENANTS................................................................................... 33
7A. Affirmative Covenants.............................................................. 33
7A.1 Financial Statements...................................................... 33
7A.2 Inspection of Property.................................................... 36
7A.3 Covenant to Secure Notes Equally.......................................... 36
7A.4 Partnership or Corporate Existence, etc.; Compliance with Laws............ 36
7A.5 Payment of Taxes and Claims............................................... 37
7A.6 Compliance with ERISA..................................................... 37
7A.7 Maintenance and Sufficiency of Properties................................. 37
7A.8 Insurance................................................................. 37
7A.9 Environmental Laws........................................................ 38
7A.10 Operative Agreements...................................................... 38
7A.11 After-Acquired Property................................................... 38
7A.12 Further Assurances........................................................ 38
7A.13 Books and Accounts........................................................ 38
7A.14 Available Cash Reserves................................................... 38
7A.15 Parity Debt............................................................... 39
7B. Negative Covenants................................................................. 39
7B.1 Financial Ratios.......................................................... 39
7B.2 Indebtedness.............................................................. 40
7B.3 Liens..................................................................... 41
7B.4 Priority Debt............................................................. 43
7B.5 Loans, Advances, Investments and Contingent Liabilities.................. 43
7B.6 Restricted Payments....................................................... 45
7B.7 Consolidation, Merger, Sale of Assets, etc................................ 45
7B.8 Business.................................................................. 46
7B.9 Transactions with Affiliates.............................................. 46
7B.10 Subsidiary Stock and Indebtedness......................................... 47
7B.11 Payment of Dividends by Subsidiaries...................................... 47
7B.12 Sales of Receivables...................................................... 47
7B.13 Material Agreements; Tax Status........................................... 47
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ARTICLE VIII REPRESENTATIONS, COVENANTS AND WARRANTIES................................................... 48
8.1 Organization....................................................................... 48
8.2 Partnership Interests.............................................................. 48
8.3 Qualification...................................................................... 48
8.4 Business; Financial Statements..................................................... 48
8.5 Actions Pending.................................................................... 49
8.6 Changes............................................................................ 49
8.7 Outstanding Indebtedness........................................................... 49
8.8 Transfer of Assets and Business; Title to Properties............................... 49
8.9 Taxes.............................................................................. 49
8.10 Compliance with Other Instruments, etc.; Solvency.................................. 50
8.11 Governmental Consent............................................................... 50
8.12 Use of Proceeds.................................................................... 50
8.13 ERISA.............................................................................. 50
8.14 Environmental Compliance........................................................... 51
8.15 Pre-emptive Rights................................................................. 51
8.16 Disclosure......................................................................... 51
8.17 Federal Reserve Regulations........................................................ 52
8.18 Investment Borrower Act............................................................ 52
8.19 Public Utility Holding Company Act................................................. 52
ARTICLE IX EVENTS OF DEFAULT........................................................................... 52
9.1 Acceleration....................................................................... 52
9.2 Remedies........................................................................... 54
9.3 Other Remedies..................................................................... 55
ARTICLE X LOAN OPERATIONS............................................................................. 55
10.1 Interests in Loans/Commitments..................................................... 55
10.2 Administrative Agent's Authority to Act............................................ 55
10.3 Borrower to Pay Administrative Agent............................................... 55
10.4 Bank Operations for Advances, Letters of Credit.................................... 56
10.4.1 Advances.................................................................. 56
10.4.2 Letters of Credit......................................................... 56
10.4.3 Administrative Agent to Allocate Payments................................. 56
10.4.4 Delinquent Banks; Nonperforming Banks..................................... 56
10.5 Sharing of Payments................................................................ 57
10.6 Amendments, Consents, Waivers...................................................... 57
10.7 Administrative Agent's Resignation................................................. 58
10.8 Concerning the Agents.............................................................. 58
10.8.1 Action in Good Faith...................................................... 58
10.8.2 No Implied Duties......................................................... 59
10.8.3 Validity.................................................................. 59
10.8.4 Compliance................................................................ 59
10.8.5 Employment Agents and Counsel............................................. 59
10.8.6 Reliance on Documents and Counsel......................................... 59
10.8.7 Agents' Reimbursement..................................................... 59
10.8.8 Agent's Fees.............................................................. 59
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10.9 Rights as a Bank................................................................... 59
10.10 Independent Credit Decision........................................................ 60
10.11 Indemnification.................................................................... 60
ARTICLE XI ASSIGNMENTS/PARTICIPATIONS.................................................................. 60
11. Successors and Assigns; Bank Assignment and Participations.................................. 60
11.1 Assignments by Banks............................................................... 60
11.1.1 Assignees and Assignment Procedures....................................... 60
11.1.2 Terms of Assignment and Acceptance........................................ 61
11.1.3 Register.................................................................. 62
11.1.4 Acceptance of Assignment and Assumption................................... 62
11.1.5 Federal Reserve Bank...................................................... 62
11.1.6 Further Assurances........................................................ 62
11.2 Credit Participants................................................................ 62
11.3 Replacement of Bank................................................................ 63
11.4 Sale of a Certain Participation.................................................... 64
ARTICLE XII MISCELLANEOUS............................................................................... 64
12.1 Notices............................................................................ 64
12.2 Place of Payment................................................................... 64
12.3 Survival of Agreements............................................................. 64
12.4 Parties in Interest................................................................ 65
12.5 Governing Law and Jurisdiction..................................................... 65
12.6 SUBMISSION TO JURISDICTION......................................................... 65
12.7 Maximum Interest Rate.............................................................. 65
12.8 No Waiver; Cumulative Remedies..................................................... 65
12.9 Costs.............................................................................. 65
12.10 WAIVER OF JURY..................................................................... 65
12.11 Full Agreement..................................................................... 66
12.12 Headings........................................................................... 66
12.13 Severability....................................................................... 66
12.14 Exceptions to Covenants............................................................ 66
12.15 Conflict with Security Documents................................................... 66
12.16 Confidentiality.................................................................... 66
12.17 Counterparts....................................................................... 66
12.18 Existing Credit Agreement...........................................................66
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FIRST AMENDED AND RESTATED
CREDIT AGREEMENT
THIS FIRST AMENDED AND RESTATED CREDIT AGREEMENT, dated as of May 31,
1999 (this "Agreement"), is entered into between and among HERITAGE OPERATING,
L.P., a Delaware limited partnership (the "Borrower") and BANK OF OKLAHOMA,
NATIONAL ASSOCIATION ("BOk"), MERCANTILE BANK NATIONAL ASSOCIATION
("Mercantile"), and LOCAL OKLAHOMA BANK, N.A. ("Local") (BOk, Mercantile and
Local, together with each other Person that becomes a Bank pursuant to Section
11 collectively referred to herein as the "Banks"), and BOk, as administrative
agent for the Banks (in such capacity the "Administrative Agent"), and
Mercantile, as co-agent for the Banks (in such capacity the "Co-Agent") .
ARTICLE I
DEFINITIONS; ACCOUNTING PRINCIPLES,
TERMS AND DEFINITIONS; CONSTRUCTION
1.1 Definitions. Capitalized terms are used in this Agreement with the
specific meanings defined below in this Section 1.1.
"Acquired Debt" means with respect to any specified Person, (i)
Indebtedness of any other Person existing at the time such other Person merged
with or into or became a Subsidiary of such specified Person, including
Indebtedness incurred in connection with, or in contemplation of, such other
Person merging with or into or becoming a Subsidiary of such specified Person
and (ii) Indebtedness encumbering any asset acquired by such specified Person.
"Acquisition Conversion Date" is defined in Section 2.1.1.
"Acquisition/Capex Due Diligence Package" is defined in Section 2.1.3.
"Acquisition Facility" means the agreement of the Banks herein to make
the Acquisition Loan.
"Acquisition Loan Account" is defined in Section 2.1.4.
"Acquisition Loan" is defined in Section 2.1.4.
"Acquisition Notes" is defined in Section 2.1.4.
"Additional Parity Debt" means Indebtedness of the Borrower that both
(a) is permitted under Section 7B.2(xiv) hereof or is incurred with the consent
of the Requisite Percentage of the Banks and (b) constitutes "Additional Parity
Debt" as defined in the Note Purchase Agreement and the Intercreditor Agreement.
"Administrative Agent" means BOk in its capacity as administrative
agent for the Banks hereunder, as well as its successors and assigns in such
capacity pursuant to Section 10.7.
"Affected Bank" is defined in Section 11.3.
"Affiliate" means, with respect to any Person any other Person directly
or indirectly controlling, controlled by, or under direct or indirect common
control with, such Person, except a Subsidiary of such Person. A Person shall be
deemed to control a corporation if such Person (i) possesses, directly or
indirectly, the power to direct or cause the direction of the management and
policies of such corporation, whether through the ownership of voting
securities, by contract or otherwise or (ii) owns at least 5% of the Voting
Stock of a corporation. As applied to the Borrower, "Affiliate" includes the
General Partner and the Master Partnership.
"Agent" means collectively the Administrative Agent and the Co-Agent.
"Agreement" means this Agreement as from time to time amended, modified
and in effect.
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"Allocable Proceeds" means, with respect to Excess Sale Proceeds or
Excess Taking Proceeds, as the case may be, to be applied on any date pursuant
to Sections 4.2.3(i) and 4.2.3(ii), the principal amount thereof available to
prepay the Acquisition Notes determined by allocating such Excess Sale Proceeds
or Excess Taking Proceeds, as the case may be, pro rata among the holders of all
Acquisition Notes, the Private Placement Notes and other Parity Debt (other than
Indebtedness permitted by Section 7B.2(ii)), if any, according to the aggregate
principal amounts of the Acquisition Notes, the Private Placement Notes and such
other Parity Debt outstanding on the date the applicable prepayment is to be
made in accordance with Sections 4.2.3(i) and 4.2.3(ii).
"Annual Clean-Up" is defined in Section 2.2.2.
"Applicable Commitment Fee Percentage" means, with respect to any
Margin Period, the applicable percentage set forth below:
(i) if the Leverage Ratio on the Financial Statement Delivery Date
beginning such Margin Period was less than 3.25 to 1, .25%;
(ii) if the Leverage Ratio on the Financial Statement Delivery Date
beginning such Margin Period was equal to or greater than 3.25 to 1 but
less than 3.75 to 1, .30%;
(iii) if the Leverage Ratio on the Financial Statement Delivery Date
beginning such Margin Period was equal to or greater than 3.75 to 1 but
less than 4.25 to 1, .35%; and
(iv) if the Leverage Ratio on the Financial Statement Delivery Date
beginning such Margin Period was equal to or greater than 4.25 to 1,
.375%.
Notwithstanding the foregoing, if any of the financial statements
required pursuant to Section 7A.1(i) are not delivered within the time periods
specified in Section 7A.1(i), the Applicable Commitment Fee Percentage shall be
.375% until the date such statements are delivered.
"Applicable Margin". With respect to any Eurodollar Loan or with
respect to any Base Rate Loan, the rate of interest per annum determined for any
Margin Period:
(i) if the Leverage Ratio on the Financial Statement Delivery Date
commencing such Margin Period was less than 3.25 to 1, the Applicable
Margin will be .75% for Eurodollar Loans and zero for Base Rate Loans;
(ii) if the Leverage Ratio on the Financial Statement Delivery Date
commencing such Margin Period was equal to or greater than 3.25 to 1
but less than 3.75 to 1, the Applicable Margin will be 1.00% for
Eurodollar Loans and zero for Base Rate Loans;
(iii) if the Leverage Ratio on the Financial Statement Delivery Date
commencing such Margin Period was equal to or greater than 3.75 to 1
but less than 4.25 to 1, the Applicable Margin will be 1.25% for
Eurodollar Loans and zero for Base Rate Loans;
(iv) if the Leverage Ratio on the Financial Statement Delivery Date
commencing such Margin Period was equal to or greater than 4.25 to 1
but less than 4.50 to 1, the Applicable Margin will be 1.375% for
Eurodollar Loans and zero for Base Rate Loans;
(v) if the Leverage Ratio on the Financial Statement Delivery Date
commencing such Margin Period was equal to or greater than 4.50 to 1
but less than 4.75 to 1, the Applicable Margin will be 1.50% for
Eurodollar Loans and zero for Base Rate Loans; and
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(vi) if the Leverage Ratio on the Financial Statement Delivery Date
commencing such Margin Period was equal to or greater than 4.75 to 1,
the Applicable Margin will be 1.75% for Eurodollar Loans and .125% for
Base Rate Loans.
Notwithstanding the foregoing, if any of the financial statements
required pursuant to Section 7A.1(i) are not delivered within the time periods
specified in Section 7A.1(i), the Applicable Margin shall be the Applicable
Margin set forth in clause (vi) above until the date such statements are
delivered.
"Applicable Rate" means, at any date:
(i) the sum of (a) with respect to each Eurodollar Loan, the sum of the
Applicable Margin in effect on such date plus the Eurodollar Rate
relating to such Eurodollar Loan; (b) with respect to each Base Rate
Loan, the sum of the Applicable Margin in effect on such date plus the
Base Rate relating to such Base Rate Loan; and
(ii) an additional two percentage points (2%) effective on the day the
Administrative Agent notifies the Borrower that the interest rates
hereunder are increasing as a result of the occurrence and continuance
of an Event of Default until such time as (A) such Event of Default is
no longer continuing or (B) such Event of Default is deemed no longer
to exist, in each case pursuant to Article IX hereof.
"Asset Acquisition" means (i) an Investment by the Borrower or any
Subsidiary of the Borrower in any other Person pursuant to which such Person
shall become a Subsidiary of the Borrower or shall be merged with or into the
Borrower or any Subsidiary of the Borrower, (ii) the acquisition by the Borrower
or any Subsidiary of the Borrower of the assets of any Person which constitute
all or substantially all of the assets of such Person or (iii) the acquisition
by the Borrower or any Subsidiary of the Borrower of any division or line of
business of any Person (other than a Subsidiary of the Borrower).
"Asset Sale" is defined in Section 7B.7(iii).
"Assets" is defined in the second opening paragraph of the Note
Purchase Agreement, as in effect on the date hereof.
"Assignment and Acceptance" is defined in Section 11.1.1.
"Attributable Debt" means, with respect to any Sale and Lease-Back
Transaction not involving a Capitalized Lease Obligation, as of any date of
determination, the total obligation (discounted to present value at the rate of
interest implicit in the lease included in such transaction) of the lessee for
rental payments (other than accounts required to be paid on account of property
taxes, maintenance, repairs, insurance, assessments, utilities, operating and
labor costs and other items which do not constitute payments for property
rights) during the remaining portion of the term (including extensions which are
at the sole option of the lessor) of the lease included in such transaction (in
the case of any lease which is terminable by the lessee upon the payment of a
penalty, such rental obligation shall also include the amount of such penalty,
but no rent shall be considered as required to be paid under such lease
subsequent to the first date upon which it may be so terminated).
"Available Cash" means, with respect to any fiscal quarter of the
Borrower: (i) the sum of (a) all cash and cash equivalents of the Borrower and
its Subsidiaries on hand at the end of such quarter and (b) all additional cash
and cash equivalents of the Borrower and its Subsidiaries on hand on the date of
determination of Available Cash with respect to such quarter resulting from
borrowings for working capital purposes made subsequent to the end of such
quarter, less (ii) the amount of any cash reserves that is necessary or
appropriate in the reasonable discretion of the General Partner to (a) provide
for the proper conduct of the business of the Borrower and its Subsidiaries
(including reserves for future capital expenditures) subsequent to such quarter,
(b) comply with applicable law or any loan agreement, security agreement,
mortgage, debt instrument or other agreement or obligation to which the Borrower
or any Subsidiary is a party or by which it is bound or its assets are subject
(including the Loan Documents) and (c) provide funds for distributions to
partners of the Master Partnership and the General Partner in respect of any one
or more of the next four quarters; provided that the General Partner need not
establish cash
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reserves pursuant to clause (c) if the effect of such reserves would be that the
Master Partnership is unable to distribute the Minimum Quarterly Distribution
(as defined in the Agreement of Limited Partnership of the Master Partnership)
on all Common Units with respect to such quarter; and provided, further, that
disbursements made by the Borrower or a Subsidiary of the Borrower or cash
reserves established, increased or reduced after the end of such quarter but on
or before the date of determination of Available Cash with respect to such
quarter shall be deemed to have been made, established, increased or reduced for
purposes of determining Available Cash, within such quarter if the General
Partner so determines. In addition, without limiting the foregoing, Available
Cash for any fiscal quarter shall reflect reserves equal to (A) 50% of the
interest projected to be paid on the Private Placement Notes in the next
succeeding fiscal quarter plus (B) beginning with a date three fiscal quarters
before a scheduled principal payment date on the Private Placement Notes, 25% of
the aggregate principal amount thereof due on any such payment date in the third
succeeding fiscal quarter, 50% of the aggregate principal amount due on any such
payment date in the second succeeding fiscal quarter and 75% of the aggregate
principal amount due on any quarterly payment date in the next succeeding fiscal
quarter, plus (C) the Unused Proceeds Reserve as of the date of determination,
provided that the foregoing reserves for amounts to be paid on the Private
Placement Notes shall be reduced by the aggregate amount of advances available
to the Borrower from responsible financial institutions under binding
irrevocable (x) credit or financing commitments (which are subject to no
conditions which the Borrower is unable to meet) including this Agreement and
(y) letters of credit (which are subject to no conditions which the Borrower is
unable to meet) in each case to be used to refinance such amounts, to the extent
such amounts could be borrowed and remain outstanding under Sections 7B.2 and
7B.1.
"Bank" means each of the Persons listed as Banks on the signature page
hereto, including each of BOk, Mercantile and Local in its capacity as a Bank,
and such other Persons who may from time to time own a Percentage Interest in
the Credit Obligations, but the term "Bank" shall not include any Credit
Participant.
"BOk" has the meaning specified in the introduction to this Agreement.
"Bank Legal Requirement" means any present or future requirement
imposed upon any of the Banks or the Borrower and its Subsidiaries by any law,
statute, rule, regulation, directive, order, decree, guideline (or any
interpretation thereof by courts or of administrative bodies) of the United
States of America, or any jurisdiction in which any Eurodollar Office is located
or any state or political subdivision of any of the foregoing, or by any board,
governmental or administrative agency, central bank or monetary authority of the
United States of America, any jurisdiction in which any Eurodollar Office is
located, or any political subdivision of any of the foregoing. any such
requirement imposed on any of the Banks not having the force of law shall be
deemed to be a Bank Legal Requirement if such Bank reasonably believes that
compliance therewith is in the best interest of such Bank.
"Banking Day" means any day other than Saturday, Sunday or a day on
which banks in Tulsa, Oklahoma are authorized or required by law or other
governmental action to close and, if such term is used with reference to a
Eurodollar Pricing Option, any day on which dealings are effected in the
Eurodollars in question by first-class banks in the inter-bank Eurodollar
markets in New York, New York.
"Bankruptcy Law" is defined in clause (viii) of Section 9.1.
"Base Rate" means, on any date, the greater (i) the rate of interest
announced by Chase Manhattan Bank, National Association, New York, New York, as
its Base Rate or (ii) the sum of 1/2% plus the Federal Funds Rate.
"Base Rate Loan" means each portion of the Loan bearing interest
determined by reference to the Base Rate.
"Bi-State" means Heritage-Bi State LLC, a Delaware limited liability
company.
"Business" means the wholesale and retail sale, storage and
distribution of propane gas, providing repair, installation and maintenance
services for propane heating systems and the sale and distribution of propane -
related supplies and equipment, including appliances.
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"Capital Stock" means, with respect to any Person, any and all shares,
units representing interests, participations, rights in or other equivalents
(however designated) of such Person's capital stock, including, with respect to
partnerships, partnership interests (whether general or limited) and any other
interest or participation that confers upon a Person the right to receive a
share of the profits and losses of, or distributions of assets of, such
partnership, and any rights (other than debt securities convertible into capital
stock), warrants or options exchangeable for or convertible into such capital
stock.
"Capitalized Lease Obligation" means any rental obligation which under
GAAP would be required to be capitalized on the books of the Borrower or any of
its Subsidiaries, taken at the amount thereof accounted for as indebtedness (net
of interest expense) in accordance with such principles.
"Cash Equivalents" is defined in Section 7B.5(iii).
"CERCLA" shall mean the Comprehensive Environmental Response,
Compensation and Liability Act of 1980, 42 U.S.C. Section 9601 et seq., as the
same may be amended from time to time.
"Certificates and Stock Powers" is defined in Section 6.1(vi).
"Change of Control" means the acquisition by any Person or group of
related persons (as such terms are defined in the Exchange Act) (other than the
Current Management or group of related persons (as so defined) including the
Current Management) of beneficial ownership of more than 50% of the Units.
"Closing Date" means the effective date of this Agreement, the
Acquisition Conversion Date and each other date on which any extension of credit
is made pursuant to Section 2.1, 2.2 or 2.3.
"Code" means the Internal Revenue Code of 1986, as amended.
"Collateral" is defined in the Security Agreement, provided, however,
that Collateral shall not include for any purpose under this Agreement or any
other Loan Document any property subject to a Lien incurred pursuant to clause
(i), (vii) or (viii) of Section 7B.3 or any renewals of any such Lien pursuant
to clause (xiv) of Section 7B.3 unless the Indebtedness secured by such Lien
shall have been paid or discharged.
"Collateral Agent" shall mean Wilmington Trust Company, a Delaware
trust company, in its capacity as collateral agent under the Intercreditor and
Agency Agreement and its successors and assigns in such capacity under Section
11 thereof.
"Commission" means the United States Securities and Exchange
Commission.
"Commitments" means, with respect to any Bank, such Bank's obligations
to extend the credit facilities contemplated by Section 2. The original
Commitments are set forth in Section 10.1 and the current Commitments are
recorded from time to time in the Register.
"Consolidated Debt Service" means, as of any date of determination, the
total amount payable by the Borrower and its Subsidiaries on a consolidated
basis during the four consecutive calendar quarters next succeeding the date of
determination, in respect of scheduled principal and interest payments with
respect to Indebtedness of the Borrower and its Subsidiaries outstanding on such
date of determination, after giving effect to any Indebtedness proposed on such
date to be incurred and to the substantially concurrent repayment of any other
Indebtedness (a) including actual payments under Capitalized Lease Obligations,
(b) assuming, in the case of Indebtedness (other than Indebtedness referred to
in clause (c) below) bearing interest at fluctuating interest rates which cannot
be determined in advance, that the rate actually in effect on such date will
remain in effect throughout such period, (c) including only actual interest (but
not principal) payments associated with the Indebtedness incurred pursuant to
Section 7B.2(ii) and 7B.2(v) during the most recent four consecutive calendar
quarters and (d) treating the principal amount of all Indebtedness outstanding
as of such date of determination under a revolving credit or similar agreement
(other than the Indebtedness incurred pursuant to Section 7B.2(ii) and Section
7B.2(v)) as maturing and becoming due and payable on the scheduled maturity date
or dates thereof (including the maturity of any payment
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required by any commitment reduction or similar amortization provision), without
regard to any provision permitting such maturity date to be extended (except for
such extensions as may be made in the sole discretion of the borrower thereunder
and without any conditions that remain to be fulfilled by the borrower or waived
by the lender thereunder). See Section 1.2.
"Consolidated EBITDA" means, as of any date of determination for any
applicable period, (1) the sum of, without duplication, the amounts for such
period, taken as a single accounting period, of (a) Consolidated Net Income and
(b) to the extent deducted in the determination of Consolidated Net Income,
after excluding amounts attributable to minority interests in Subsidiaries and
without duplication, (i) Consolidated Non-Cash Charges, (ii) Consolidated
Interest Expense and (iii) Consolidated Income Tax Expense less (2) any non-cash
items increasing Consolidated Net Income for such period to the extent that such
items constitute reversals of a Consolidated Non-Cash Charge for a previous
period and which were included in the computation of Consolidated EBITDA for
such previous period pursuant to the provisions of the preceding clause (1).
Consolidated EBITDA shall be calculated after giving effect, on a pro forma
basis and in accordance with GAAP, to, without duplication, any Asset Sales or
Asset Acquisitions (including without limitation any Asset Acquisition giving
rise to the need to make such calculation as a result of the Borrower or one of
its Subsidiaries incurring, assuming or otherwise being liable for Acquired
Debt) occurring during the period commencing on the first day of such period to
and including the date of the transaction (the "Reference Period"), as if such
Asset Sale or Asset Acquisition occurred on the first day of the Reference
Period; provided, however, that Consolidated EBITDA generated by an acquired
business or asset shall be determined by the actual gross profit (revenues minus
cost of goods sold) of such acquired business or asset during the immediately
preceding four full fiscal quarters in the Reference Period minus the pro forma
expenses that would have been incurred by the Borrower and its Subsidiaries in
the operation of such acquired business or asset during such period computed on
the basis of personnel expenses for employees retained or to be retained by the
Borrower and its Subsidiaries in the operation of such acquired business or
asset and non-personnel costs and expenses incurred by the Borrower and its
Subsidiaries in the operation of the Borrower's business at similarly situated
facilities of the Borrower or any of its Subsidiaries (as determined in good
faith by the General Partner determined (a) on the basis of 100% that amount for
the period of upon reasonable assumptions). As used herein, but only for
purposes of Sections 7B.1(i) and (ii), Consolidated EBITDA shall be determined
(a) on the basis of 100% of that amount for the period of the four most recent
fiscal quarters ending on or prior to the date of determination or (b) 50% of
that amount for the period of the eight most recent fiscal quarters ending on or
prior to the date of determination, whichever is higher. For all other purposes
hereof, Consolidated EBITDA shall be based upon that amount determined over the
four most recent fiscal quarters ending on or prior to the date of determination
(or, as the case may be, for which financial statements have been or are
required to be delivered to the Banks pursuant to Section 7B.1(i) and (ii)). See
Section 1.2.
"Consolidated Funded Indebtedness" means, as of any date of
determination, the aggregate amount of Indebtedness of the Borrower and its
Subsidiaries outstanding on that date and maturing in more than 12 months,
including the Private Placement Notes and borrowings under the Acquisition
Facility (including current maturities of any such Indebtedness).
Notwithstanding anything to the contrary contained herein, Consolidated Funded
Indebtedness shall not include borrowings under the Working Capital Facility to
the extent permitted under the Note Purchase Agreement.
"Consolidated Income Tax Expense" means, with respect to the Borrower
and its Subsidiaries, for any period, the provision for federal, state, local
and foreign income taxes of the Borrower and its Subsidiaries for such period as
determined on a consolidated basis in accordance with GAAP. See Section 1.2.
"Consolidated Interest Expense" means as of any date of determination
for any applicable period, without duplication, the sum of (i) the interest
expense of the Borrower and its Subsidiaries for such period as determined on a
consolidated basis in accordance with GAAP, including without limitation (a) any
amortization of debt discount, (b) the net cost under Interest Rate Agreements,
(c) the interest portion of any deferred payment obligation, (d) all
commissions, discounts and other fees and charges owed with respect to letters
of credit and bankers' acceptance financing and (e) all accrued interest and
(ii) the interest component of Capitalized Lease Obligations paid, accrued or
scheduled to be paid or accrued by the Borrower and its Subsidiaries during such
period as determined on a consolidated basis in accordance with GAAP. In
computing Consolidated Interest Expense for purposes of clause
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(ii) of Section 7B.1, the applicable period for the determination thereof shall
be the four most recent fiscal quarters ending on or prior to the date of
determination. See Section 1.2.
"Consolidated Net Income" means the net income of the Borrower and its
Subsidiaries, as determined on a consolidated basis in accordance with GAAP and
after provision for minority interests and as adjusted to exclude (i) net
after-tax extraordinary gains or losses, (ii) net after-tax gains or losses
attributable to Asset Sales, (iii) the net income or loss of any Person which is
not a Subsidiary of the Borrower and which is accounted for by the equity method
of accounting, provided that Consolidated Net Income shall include the amount of
cash dividends or distributions actually paid to the Borrower or any Subsidiary
of the Borrower, (iv) the net income or loss prior to the date of acquisition of
any Person combined with the Borrower or any Subsidiary of the Borrower in a
pooling of interest, (v) the net income of any Subsidiary of the Borrower to the
extent that dividends or distributions of such net income are not at the date of
determination permitted by the terms of its charter or any agreement,
instrument, judgment, decree, order, statute, rule or other regulation and (vi)
the cumulative effect of any changes in accounting principles. See Section 1.2.
"Consolidated Net Tangible Assets" means, as of any date of
determination, the Total Assets of the Borrower and its Subsidiaries, minus the
net book value of all assets of the Borrower and its Subsidiaries (after
deducting any reserves applicable thereto) which would be shown as intangible
assets on a consolidated balance sheet of the Borrower and its Subsidiaries as
of such time prepared in accordance with GAAP. See Section 1.2.
"Consolidated Net Worth" means, with respect to any Person, at any date
of determination, the total partners' capital (in the case of a partnership) or
stockholders' equity (in the case of a corporation) of such Person at such date,
as would be shown on a consolidated balance sheet of such Person and its
Subsidiaries, if any, prepared in accordance with GAAP. See Section 1.2.
"Consolidated Non-Cash Charges" means with respect to the Borrower and
its Subsidiaries, for any period, the aggregate depreciation and amortization,
in each case reducing Consolidated Net Income of the Borrower and its
Subsidiaries for such period, determined on a consolidated basis in accordance
with GAAP. See Section 1.2.
"Consolidated Pro Forma Maximum Debt Service" means, as of any date of
determination, the maximum amount payable by the Borrower and its Subsidiaries
on a consolidated basis during all periods of four consecutive calendar
quarters, commencing with the calendar quarter in which such date of
determination occurs and ending June 30, 2011, in respect of scheduled principal
and interest payments with respect to all Indebtedness of the Borrower and its
Subsidiaries outstanding on such date of determination, after giving effect to
any Indebtedness proposed on such date to be incurred and to the substantially
concurrent repayment of any other Indebtedness (a) including all payments under
Capitalized Lease Obligations, (b) assuming, in the case of Indebtedness (other
than Indebtedness referred to in clause (c) below) bearing interest at
fluctuating interest rates which cannot be determined in advance, that the rate
actually in effect on such date will remain in effect throughout such period,
(c) including only actual interest (but not principal) payments associated with
the Indebtedness incurred pursuant to Section 7B.2 during the most recent four
consecutive calendar quarters and (d) treating the principal amount of all
Indebtedness outstanding as of such date of determination under a revolving
credit or similar agreement (other than the Indebtedness incurred pursuant to
Section 7B.2 as maturing and becoming due and payable on the scheduled maturity
date or dates thereof (including the maturity of any payment required by any
commitment reduction or similar amortization provision), without regard to any
provision permitting such maturity date to be extended (except for such
extensions as may be made in the sole discretion of the borrower thereunder and
without any conditions that remain to be fulfilled by the borrower or waived by
the lender thereunder). See Section 1.2.
"Consolidated Tangible Net Worth" means, with respect to any Person, at
any date of determination, the then Consolidated Net Worth of Person minus the
net book value of all assets of such Person and its Subsidiaries, if any, (after
deducting any reserves applicable thereto), which would be shown as intangible
assets on a consolidated balance sheet of such Person and its Subsidiaries, if
any, as of such time prepared in accordance with GAAP. See Section 1.2.
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"Contribution Agreement" shall mean the Contribution, Conveyance and
Assumption Agreement, dated as of June 28, 1996, among Heritage, the Borrower
and the other signatories thereto, as the same may from time to time be amended,
supplemented or otherwise modified in accordance with the terms thereof and
hereof.
"Control Event" means:
(i) the execution of any written agreement to which the Borrower or any
Affiliate of the Borrower is a party which could reasonably be expected
to result in a Change of Control.
(ii) the commencement (as such term is used in Rule 14d-2(a) under the
Exchange Act as in effect on the date of the Closing) of a tender offer
by any person (as such term is used in Section 13(d) and Section
14(d)(2) of the Exchange Act as in effect on the date of the Closing)
or related person constituting a group (as such term issued in Rule
13d-5 under the Exchange Act as in effect on the date of the Closing)
for units which would result in such person or group owning, directly
or indirectly, more than 50% of the outstanding Units.
"Conveyance Agreements" shall mean (a) the Contribution Agreement and
(b) each of the individual bills of sale and other conveyance documents
delivered to the Borrower pursuant to the Contribution Agreement in each case as
the same may from time to time be amended, supplemented or otherwise modified in
accordance with the terms thereof and hereof.
"Credit Obligations" means all present and future liabilities,
obligations and Indebtedness of the Borrower or any of its Subsidiaries owing to
the Administrative Agent, the Co-Agent or any Bank under or in connection with
this Agreement or any other Loan Document, including obligations in respect of
principal, interest, reimbursement obligations under Letters of Credit and
Interest Rate Agreements provided by a Bank (or an Affiliate of a Bank),
commitment fees, Letter of Credit fees, amounts provided for in Sections 3.2.4,
3.5, 3.6, 3.7, 3.8 and 3.10 and any other fees, charges, indemnities and
expenses from time to time owing hereunder or under any other Loan Documents
(whether accruing before or after the commencement of proceedings under any
Bankruptcy Law).
"Credit Participant" is defined in Section 11.2.
"Current Management" means the individual executive officers of the
General Partner named as such in the Registration Statement, together with the
heirs of, and trusts for the benefit of family members controlled by, any such
executive officer.
"Disbursement Account" is defined in Section 2.2.3.
"Environmental Laws" means all applicable federal, state, local and
foreign laws, rules or regulations as amended from time to time, relating to
emissions, discharges, releases, threatened releases, removal, remediation or
abatement of pollutants, contaminants, chemicals or industrial, toxic or
hazardous substances or wastes into or in the environment (including without
limitation air, surface water, ground water or land), or otherwise used in
connection with the manufacture, processing, distribution, use, treatment,
storage, disposal, transport or handling of pollutants, contaminants, toxic or
hazardous substances or wastes, as defined under such applicable laws.
"Equity Interest" means, with respect to any Person, any capital stock
issued by such Person, regardless of class or designation, or any limited or
general partnership interest in such Person, regardless of designation, and all
warrants, options, purchase rights, conversion or exchange rights, voting
rights, calls or claims of any character with respect thereto.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended.
"ERISA Affiliate" means any trade or business (whether or not
incorporated) that, together with the Borrower, is treated as a single employer
under Section 414(b) or (c) of the Code, or, solely for purposes of Section 302
of ERISA and Section 412 of the Code, is treated as a single employer under
Section 414 of the Code.
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"ERISA Event" means (i) any "reportable event", as defined in Section
4043 of ERISA or the regulations issued thereunder, with respect to a Plan; (ii)
the adoption of any amendment to a Plan that would require the provision of
security pursuant to Section 401(a)(29) of the Code or Section 307 of ERISA;
(iii) the existence with respect to any Plan of an "accumulated funding
deficiency" (as defined in Section 412 of the Code or Section 302 of ERISA),
whether or not waived; (iv) the filing pursuant to Section 412(d) of the Code or
Section 303(d) of ERISA of an application for a waiver of the minimum funding
standard with respect to any Plan; (v) the incurrence of any liability under
Title IV of ERISA with respect to the termination of any Plan or the withdrawal
or partial withdrawal of the Borrower or any of its ERISA Affiliates from any
Plan or Multiemployer Plan; (vi) the receipt by the Borrower or any ERISA
Affiliate from the PBGC or a plan administrator of any notice relating to the
intention to terminate any Plan or Plans or to appoint a trustee to administer
any Plan; (vii) the receipt by the Borrower or any ERISA Affiliate of any notice
concerning the imposition of Withdrawal Liability or a determination that a
Multiemployer Plan is, or is expected to be, insolvent or in reorganization,
within the meaning of Title IV of ERISA; and (viii) the occurrence of a
"prohibited transaction" with respect to which the Borrower or any of its
Subsidiaries is a "disqualified person" (within the meaning of Section 4975 of
the Code) and with respect to which the Borrower or such Subsidiary would be
liable for the payment of an excise tax.
"Eurodollars" means, with respect to any Bank, deposits of United
States Funds in a non-United States office or an international banking facility
of such Bank.
"Eurodollar Basic Rate" means, for any Eurodollar Interest Period, the
rate of interest at which Eurodollar deposits in an amount comparable to the
Percentage Interest of BOk in the portion of a Loan as to which a Eurodollar
Pricing Option has been elected and which have a term corresponding to such
Eurodollar Interest Period are offered to the Administrative Agent by first
class banks in the inter-bank Eurodollar market for delivery in immediately
available funds at a Eurodollar Office on the first day of such Eurodollar
Interest Period as determined by the Administrative Agent at approximately 10:00
a.m. (Tulsa, Oklahoma time) two Banking Days prior to the date upon which such
Eurodollar Interest Period is to commence (which determination by the
Administrative Agent shall, in the absence of manifest error, be conclusive) and
as furnished promptly thereafter by the Administrative Agent.
"Eurodollar Interest Period" means any period, selected as provided in
Section 3.2.1, of one or three months, commencing on any Banking Day and ending
on the corresponding date in the subsequent calendar month so indicated (or, if
such subsequent calendar month has no corresponding date, on the last day of
such subsequent calendar month); provided, however, that subject to Section
3.2.3, if any Eurodollar Interest Period so selected would otherwise begin or
end on a date which is not a Banking Day, such Eurodollar Interest Period shall
instead begin or end, as the case may be, on the immediately preceding or
succeeding Banking Day as determined by the Administrative Agent in accordance
with the then current banking practice in the inter-bank Eurodollar market with
respect to Eurodollar deposits at the applicable Eurodollar Office, which
determination by the Administrative Agent shall, in the absence of manifest
error, be conclusive.
"Eurodollar Loan" means each portion of the Loan bearing interest
determined by reference to the Eurodollar Rate.
"Eurodollar Office" means such non-United States office or
international banking facility of any Bank as the Administrative Agent may from
time to time select.
"Eurodollar Pricing Options" means the options granted pursuant to
Section 3.2.1 to have the interest on any portion of a Loan computed on the
basis of a Eurodollar Rate.
"Eurodollar Rate" for any Eurodollar Interest Period means the rate,
rounded upward to the nearest 1/100%, obtained by dividing (a) the Eurodollar
Basic Rate for such Eurodollar Interest Period by (b) an amount equal to 1 minus
the Eurodollar Reserve Rate; provided, however, that if at any time during such
Eurodollar Interest Period the Eurodollar Reserve Rate applicable to any
outstanding Eurodollar Pricing Option changes, the Eurodollar Rate for such
Eurodollar Interest Period shall automatically be adjusted to reflect such
change, effective as of the date of such change.
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"Eurodollar Reserve Rate" means the stated maximum rate (expressed as a
decimal) of all reserves (including any basic, supplemental, marginal or
emergency reserve or any reserve asset), if any, as from time to time in effect,
required by any Bank Legal Requirement to be maintained by any Bank against (a)
"Eurocurrency liabilities" as specified in Regulation D of the Board of
Governors of the Federal Reserve System applicable to Eurodollar Pricing
Options, (b) any other category of liabilities that includes Eurodollar deposits
by reference to which the interest rate on portions of a Loan subject to
Eurodollar Pricing Options is determined, (c) the principal amount of or
interest on any portion of the Loan subject to a Eurodollar Pricing Option or
(d) any other category of extensions of credit, or other assets, that includes
loan subject to a Eurodollar Pricing Option by a non-United States office of any
of the Banks to United States residents, in each case without the benefits of
credits for prorations, exceptions or offsets that may be available to a Lender.
"Event of Default" means any of the events specified in Section 9.1,
provided that there has been satisfied any requirement in connection with such
event for the giving of notice, or the lapse of time, or the happening of any
further condition, event or act, and "Default" shall mean any of such events,
whether or not any such requirement has been satisfied.
"Excess Proceeds" is defined in Section 4.2.4.
"Excess Sale Proceeds" is defined in Section 7B.7(iii)(c)(ii).
"Excess Taking Proceeds" is defined in Section 4.2.3(ii).
"Exchange Act" means the Securities Exchange Act of 1934, as amended.
"Existing Credit Agreement" means the Credit Agreement dated as of June
25, 1996, as amended by the First Amendment to Credit Agreement dated as of July
25, 1996, the Second Amendment to Credit Agreement dated as of February 28,
1997, the Third Amendment to Credit Agreement dated as of September 30, 1997,
the Fourth Amendment to Credit Agreement dated as of November 18, 1997, and the
Fifth Amendment to Credit Agreement dated as of November 13, 1998, between and
among Borrower, BOk, Mercantile and BankBoston, N.A., and BankBoston, N.A., as
Administrative Agent, and BOk, as Documentation Agent.
"Federal Funds Rate" means, for any day, the rate equal to the weighted
average (rounded upward to the nearest 1/8%) of the rates on overnight federal
funds transactions with members of the Federal Reserve System arranged by
federal funds brokers, (i) as such weighted average is published for such day
(or, if such day is not a Banking Day, for the immediately preceding Banking
Day) by the Federal Reserve Bank of New York or (ii) if such rate is not so
published for such Banking Day, as determined by the Administrative Agent using
any reasonable means of determination. Each determination by the Administrative
Agent of the Federal Funds Rate shall, in the absence of manifest error, be
conclusive.
"Final Maturity Date" means (i) with respect to the Working Capital
Loan, June 30, 2002, and (ii) with respect to the Acquisition Loan, June 30,
2004.
"Financial Statement Delivery Date" means each date on which financial
statements are to be delivered pursuant to Section 7A.1(i).
"Financing Statements" shall have the meaning specified in Section
6.1(vi).
"Fixed Charges" shall mean scheduled principal and interest payments
and payments due under Capitalized Lease Obligations.
"Foreign Trade Regulations" means (i) any act that prohibits or
restricts, or empowers the President or any executive agency of the United
States of America to prohibit or restrict, exports to or financial transactions
with any foreign country or foreign national, (ii) the regulations with respect
to certain prohibited foreign trade transactions set forth at 22 C.F.R. parts
120-130 and 31 C.F.R. Part 500 and (iii) any order, regulation, ruling,
interpretation, direction, instruction or notice relating to any of the
foregoing.
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"Funding Liability" means (a) any Eurodollar deposit which was used (or
deemed by Section 3.2.6 to have been used) to fund any portion of a Loan subject
to a Eurodollar Pricing Option, and (b) any portion of a Loan subject to a
Eurodollar Pricing Option funded (or deemed by Section 3.2.6 to have been
funded) with the proceeds of any such Eurodollar deposit.
"GAAP" is defined in Section 1.2.
"General Partner" means Heritage in its capacity as the general partner
of the Borrower.
"Governmental Authority" means any governmental agency, authority,
instrumentality or regulatory body, other than a court or other tribunal, in
each case whether federal, state, local or foreign.
"Guaranty" means, with respect to any Person, any direct or indirect
liability, contingent or otherwise, of such Person with respect to any
Indebtedness of another, including, without limitation, any such obligation
directly or indirectly guaranteed, endorsed (otherwise than for collection or
deposit in the ordinary course of business) or discounted or sold with recourse
by such Person, or in respect of each such Person is otherwise directly or
indirectly liable, including, without limitation, any such obligation in effect
guaranteed by such Person through any agreement (contingent or otherwise) to
purchase, repurchase or otherwise acquire such obligation or any security
therefor, or to provide funds for the payment or discharge of such obligation
(whether in the form of loans, advances, stock purchases, capital contributions
or otherwise), or to maintain the solvency or any balance sheet or other
financial condition of the obligor of such obligation, or to make payment for
any products, materials or supplies or for any transportation or services
regardless of the non-delivery or non-furnishing thereof, in any such case if
the purpose or intent of such agreement is to provide assurance that such
obligation will be paid or discharged, or that any agreements relating thereto
will be complied with, or that the holders of such obligation will be protected
against loss in respect thereof. The amount of any Guaranty shall be equal to
the outstanding principal amount of the obligation guaranteed or such lesser
amount to which the maximum exposure of the guarantor shall have been
specifically limited.
"Hazardous Substance" means any substance so designated pursuant to
CERCLA, asbestos, petroleum, urea formaldehyde insulation and petroleum
by-products (other than propane).
"Heritage" means Heritage Holdings, Inc., a Delaware corporation.
"Heritage Service" means Heritage Service Corp., a Delaware
corporation.
"Heritage Service Credit Agreement" means the First Amended and
Restated Revolving Credit Agreement dated as of May 31, 1999, between and among
Heritage Service, as borrower, the Banks, as lenders, the Administrative Agent
and the Co-Agent.
"HHI Acquisition Notes" shall mean those certain promissory notes from
Heritage payable to the order of the Banks as more particularly described and
defined in the Restated Letter Agreement among Heritage, the Banks and the
Agents dated as of May 31, 1999, and any credit agreement among Heritage, the
Banks and the Agents as contemplated by paragraph (ii) of such Restated Letter
Agreement.
"Indebtedness" shall mean, with respect to any Person, without
duplication,
(a) any indebtedness for borrowed money, all obligations upon which
interest charges are customarily paid and all obligations evidenced by
any bond, note, debenture or other similar instrument which such Person
has directly or indirectly created, incurred or assumed;
(b) all obligations of others secured by any Lien in respect of
property owned by such Person, whether or not such Person has assumed
or become liable for the payment of such indebtedness; provided that
the amount of such Indebtedness, if such Person has not assumed the
same or become liable therefor, shall in no event be deemed to be
greater than the fair market value from time to time of the property
subject to such Lien;
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(c) any indebtedness, whether or not for borrowed money (excluding
trade payables and accrued expenses arising in the ordinary course of
business), with respect to which such Person has become directly or
indirectly liable and which represents the deferred purchase price (or
a portion thereof) or has been incurred to finance the purchase price
(or a portion thereof) of any property or service or business acquired
by such Person, whether by purchase, consolidation, merger or
otherwise;
(d) the principal component of any Capitalized Lease Obligations to the
extent such obligations would, in accordance with GAAP, appear on a
balance sheet of such Person;
(e) all Attributable Debt of such Person in respect of Sale and
Lease-Back Transactions not involving a Capitalized Lease Obligation;
(f) all Redeemable Capital Stock of such Person valued at the greater
of its voluntary or involuntary maximum fixed repurchase price plus
accrued dividends;
(g) any Preferred Stock of any Subsidiary of such Person valued at the
liquidation preference thereof, or any mandatory redemption payment
obligations in respect thereof plus, in either case, accrued dividends
thereon;
(h) any indebtedness of the character referred to in clause (a), (b),
(c), (d), (e), (f) or (g) of this definition deemed to be extinguished
under GAAP but for which such Person remains legally liable;
(i) any indebtedness of any other Person of the character referred to
in clause (a), (b), (c), (d), (e), (f), (g) or (h) of this definition
with respect to which the Person whose Indebtedness is being determined
has become liable by way of a Guaranty;
(j) all obligations, contingent or fixed, of such person as an account
party in respect of letters of credit (other than letters of credit
incurred in the ordinary course of business and consistent with past
practice);
(k) all liabilities of such Person in respect of unfunded vested
benefits under pension plans (determined on a net basis for all such
plans) and all asserted withdrawal liabilities of such Person or a
commonly controlled entity to a Multiemployer Plan;
(l) Swaps (other than Interest Rate Agreements);
(m) all obligations of such Person in respect of bankers' acceptances
(other than in respect of accounts payable to suppliers incurred in the
ordinary course of business consistent with past practice); and
(n) any amendment, supplement, modification, deferral, renewal,
extension or refunding of any liability of the types referred to in
clauses (a) through (m) above.
For purposes hereof, the "maximum fixed repurchase price" of any
Redeemable Capital Stock which does not have a fixed repurchase price shall be
calculated in accordance with the terms of such Redeemable Capital Stock as if
such Redeemable Capital Stock were purchased on any date on which Indebtedness
shall be required to be determined pursuant to this Agreement and if such price
is based upon, or measured by, the fair market value of such Redeemable Capital
Stock, such fair market value shall be determined in good faith by the board of
directors or a similar governing body of the issuer of such Redeemable Capital
Stock.
"Intercreditor Agreement" means the Intercreditor and Agency Agreement
among the Purchasers of the Private Placement Notes, the initial Administrative
Agent (BankBoston) and the Collateral Agent, as amended or modified in
connection with the transactions and modifications contemplated by this
Agreement.
"Interest Coverage" means, as of any date, a ratio equal to the ratio
of (a) the Consolidated EBITDA of the Borrower for the period of four
consecutive fiscal quarters of the Borrower ending with the most recent fiscal
quarter for which the Borrower has delivered to the Banks, or is required under
Section 7A.1(i) to have delivered to
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the Banks, financial statements of the Borrower to (b) the Consolidated Interest
Expense of the Borrower for such period of four consecutive fiscal quarters.
"Interest Rate Agreement" shall mean any fully matched interest rate
Swap entered into with the intent to protect the Borrower against fluctuations
in interest rates and entered into as a bona fide hedging arrangement and not
for purposes of investment or speculation.
"Investment" shall mean, as applied to any Person, any direct or
indirect purchase or other acquisition by such Person of stock or other
securities of any other Person, or any direct or indirect loan, advance or
capital contribution by such Person to any other Person, and any other item
which would be classified as an "investment" on a balance sheet of such Person
prepared in accordance with GAAP, including without limitation any direct or
indirect contribution by such Person of property or assets to a joint venture,
partnership or other business entity in which such Person retains an interest
(it being understood that a direct or indirect purchase or other acquisition by
such Person of assets of any other Person (other than stock or other securities)
shall not constitute an "Investment" for purposes of this Agreement so long as
such assets are all used in the Business). For the purposes of Section 7B.5(v),
the amount involved in Investments made during any period shall be the aggregate
cost to the Borrower and its Subsidiaries of all such Investments made during
such period, determined in accordance with GAAP, but without regard to
unrealized increases or decreases in value, or write-ups, write-downs or
write-offs, of such Investments and without regard to the existence of any
undistributed earnings or accrued interest with respect thereto accrued after
the respective dates on which such Investments were made, less any net return of
capital realized during such period upon the sale, repayment or other
liquidation of such Investments (determined in accordance with GAAP, but without
regard to any amounts received during such period as earnings (in the form of
dividends not constituting a return of capital, interest or otherwise) on such
Investments or as loans from any Person in whom such Investments have been
made). See Section 1.2(i).
"Investment Limit" shall have the meaning specified in Section 7B.5.
"Legal Requirement" shall mean any law, statute, ordinance, decree,
requirement, order, judgment, rule or regulation (or published official
interpretation of any of the foregoing by any Governmental Authority) of any
Governmental Authority.
"Lending Officer" means each of such individuals whom the
Administrative Agent may designate by notice to the Borrower from time to time
as an officer who may receive telephone requests for borrowings under Section
2.1.3 and 2.2.3.
"Letter of Credit" is defined in Section 2.3.1.
"Letter of Credit Exposure" means, at any date, the sum of (a) the
aggregate face amount of all drafts that may then or thereafter be presented by
beneficiaries under all Letters of Credit then outstanding, plus (b) the
aggregate face amount of all drafts that the Letter of Credit Issuer has
previously accepted under Letters of Credit but has not paid.
"Letter of Credit Issuer" means, for any Letter of Credit, BOk or, in
the event BOk does not for any reason issue a requested Letter of Credit,
another Bank designated by the Administrative Agent to issue such Letter of
Credit in accordance with Section 2.3.
"Leverage Ratio" means, as of any date, a ratio equal to the ratio of
(a) the Consolidated Funded Indebtedness of the Borrower as of the last day of
the most recent fiscal quarter of the Borrower for which the Borrower has
delivered to the Banks, or is required under Section 7A.1(i) to have delivered
to the Banks, a consolidated balance sheet of the Borrower to (b) the
Consolidated EBITDA of the Borrower for the period of four consecutive fiscal
quarters ended on such last day.
"Liabilities" is defined in the second opening paragraph of the Note
Purchase Agreement in effect on the date hereof.
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"Lien" means any mortgage, pledge, security interest, encumbrance,
contractual deposit arrangement, lien (statutory or otherwise) or charge of any
kind (including any agreement to give any of the foregoing, any conditional sale
or other title retention agreement, any lease in the nature thereof, and the
filing of or agreement to give any financing statement under the Uniform
Commercial Code of any jurisdiction) or any other type of preferential
arrangement for the purpose, or having the effect, of protecting a creditor
against loss or securing the payment or performance of an obligation.
"Local" has the meaning ascribed thereto in the initial paragraph of
this Agreement.
"Loan" means each of the Working Capital Loan and the Acquisition Loan.
"Loan Documents" means this Agreement, the Intercreditor Agreement, the
Security Documents, the HHI Acquisition Notes and each agreement of Heritage
governing or securing the HHI Acquisition Notes and the Service Revolver Notes
and each agreement of Heritage Service governing or securing the Service
Revolver Notes.
"Margin Period" means each period commencing on (and including) the
first day of any fiscal quarter of the Borrower and ending on (and including)
the earlier of (i) the last day of such fiscal quarter of the Borrower, or (ii)
in the case of the Acquisition Facility, the Acquisition Conversion Date or, in
the case of the Working Capital Facility, the Final Maturity Date with respect
to the Working Capital Loans.
"Margin Stock" means "margin stock" within the meaning of Regulation G,
T, U or X of the Board of Governors of the Federal Reserve System.
"Master Partnership" means Heritage Propane Partners, L.P., a Delaware
limited partnership.
"Material Adverse Effect" means (i) a material adverse effect on the
business, assets or financial condition of the Borrower or the Borrower and its
Subsidiaries taken as a whole after giving effect to the Transactions, (ii) a
material impairment of the ability of the Borrower or any Subsidiary of the
Borrower to perform any of its obligations under the Loan Documents to which it
is a party or (iii) a material adverse effect on the enforceability of any of
the Loan Documents.
"Maximum Amount of Acquisition Credit" is defined in Section 2.1.2.
"Maximum Amount of Working Capital Credit" is defined in Section 2.2.2.
"Memorandum" means the memorandum dated May, 1996, prepared by
Prudential Securities for use in connection with the Borrower's private
placement of the Private Placement Notes.
"Mercantile" shall have the meaning ascribed thereto in the opening
paragraph of this Agreement.
"Multiemployer Plan" means a "multiemployer plan" as defined in section
4001(a)(3) of ERISA.
"Net Proceeds" means the proceeds of any sale of assets in the form of
cash or cash equivalents including payments in respect of deferred payment
obligations when received in the form of cash or cash equivalents net of (i)
brokerage commissions and other fees and expenses related to such sale, (ii)
provisions for any taxes payable as a result of such sale, (iii) amounts
required to be paid to any Person (other than the Borrower or any Subsidiary of
the Borrower) owning a beneficial interest in the assets sold, (iv) appropriate
amounts to be provided by the Borrower or any Subsidiary of the Borrower, as the
case may be, as a reserve required in accordance with GAAP against any
liabilities associated with such sale of assets and retained by the Borrower or
any Subsidiary of the Borrower, as the case may be, after such sale and (v)
amounts required to be applied to the repayment of Indebtedness (other than the
Private Placement Notes and amounts due under the Working Capital Facility or
Acquisition Facility) secured by a Lien on the assets sold.
"Non-Compete Obligations" is defined in Section 7B.3(viii).
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"Noncompliance Event" means either or both of the following:
(a) failure of the Borrower to maintain a Leverage Ratio that is (i)
equal to or less than 5 to 1 as of any date on or after the Closing
Date and on or prior to August 31, 2000, and (ii) equal to or less than
4.75 to 1 as of any date after August 31, 2000; and
(b) failure of the Borrower to maintain Interest Coverage that is equal
to or greater than 2.25 to 1.
"Nonperforming Bank" is defined in Section 10.4.4.
"Note Purchase Agreement" means that certain Note Purchase Agreement
between Heritage, Borrower and the Note Purchasers named in the Purchaser
Schedule annexed as Schedule I thereto dated as of June 24, 1996.
"Note Purchasers" mean the purchasers of the Private Placement Notes.
"Notes" means the Working Capital Notes and the Acquisition Notes.
"Obligations" means and include any and all: (i) indebtedness,
obligations and liabilities of the Borrower to the Banks incurred or which may
be incurred or purportedly incurred hereafter pursuant to the terms of this
Agreement or any of the other Loan Documents, and any replacements, amendments,
extensions, renewals, substitutions, amendments and increases in amount thereof,
including such amounts as may be evidenced by the Notes and all lawful interest,
late charges, loan closing fees, service fees, origination/facility fees,
commitment fees, fees in lieu of balances, letter of credit processing and
issuance fees and other charges, and all reasonable costs and expenses incurred
in connection with the preparation, filing and recording of the Loan Documents,
including reasonable attorneys fees and legal expenses; (ii) all reasonable
costs and expenses paid or incurred by the Banks and/or either Agent or the
Collateral Agent, including reasonable attorneys fees, in enforcing or
attempting to enforce collection of any Indebtedness and in enforcing or
realizing upon or attempting to enforce or realize upon any collateral or
security for any Indebtedness, including interest on all sums so expended by the
Banks and/or either Agent or the Collateral Agent accruing from the date upon
which such expenditures are made until paid, at an annual rate equal to the
Default Rate; and (iii) all sums expended by the Banks and/or either Agent or
the Collateral Agent in curing any Event of Default or Default of the Borrower
under the terms of this Agreement, the other Loan Documents or any other writing
evidencing or securing the payment of the Notes together with interest on all
sums so expended by the Banks and/or either Agent or the Collateral Agent
accruing from the date upon which such expenditures are made until paid, at an
annual rate equal to the Default Rate; and (iv) indebtedness, obligations and
liabilities of the Borrower arising out of the Note Purchase Agreement
including, without limitation, that evidenced by the Private Placement Notes.
"Offering" is defined in the second opening paragraph of the Note
Purchase Agreement as in effect on the date hereof.
"Officer's Certificate" shall mean, as to any corporation, a
certificate executed on its behalf by the Chairman of the Board of Directors (if
an officer) or its President or one of its Vice Presidents, and its Treasurer,
or Controller, or one of its Assistant Treasurers or Assistant Controllers, and,
as to the Master Partnership or the Borrower, a certificate executed on behalf
of the Master Partnership or the Borrower, as the case may be, by its general
partner in a manner which would qualify such certificate (a) if such general
partner were a corporation, as an Officer's Certificate of such general partner
hereunder or (b) if such general partner were a partnership or other entity, as
a certificate executed on its behalf by Persons authorized to do so pursuant to
the constituting documents of such partnership or other entity.
"Operative Agreements" means the Contribution Agreement, the other
Conveyance Agreements, and the Partnership Agreement.
"Overdue Reimbursement Rate" means, at any date, the highest Applicable
Rate then in effect.
"Parity Debt" means Indebtedness of the Borrower (a) (other than the
Notes) incurred in accordance with clauses (i), (ii) and (iii) of Section 7B.2
and (b) Additional Parity Debt.
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"Partnership Agreement" means the Agreement of Limited Partnership of
the Borrower as in effect on the Closing Date, and as the same may from time to
time be amended, supplemented or otherwise modified in accordance with the terms
thereof.
"Partnership Documents" means the Agreement of Limited Partnership of
the Master Partnership and the Partnership Agreement , in each case as in effect
on the Closing Date and as the same may from time to time be amended,
supplemented or otherwise modified in accordance with the terms hereof and
thereof.
"Payment Date" means the last Banking Day of each March, June,
September and December occurring after the Initial Closing Date.
"PBGC" means the Pension Benefit Guaranty Corporation or any
Governmental Authority succeeding to any of its functions.
"Percentage Interest" is defined in Section 10.1.
"Performing Bank" is defined in Section 10.4.4.
"Permits" is defined in Section 8.8.
"Permitted Banks" is defined in Section 7B.5.
"Person" means and includes an individual, a partnership, a joint
venture, a corporation, a trust, an unincorporated organization and a government
or any department or agency thereof.
"Plan" means any "employee pension benefit plan" as such term is
defined in Section 3 of ERISA (other than a Multiemployer Plan) subject to the
provisions of Title IV of ERISA or Section 412 of the Code or Section 302 of
ERISA, and in respect of which the Borrower or any ERISA Affiliate is (or, if
such plan were terminated, would under Section 4069 of ERISA be deemed to be) an
"employer" as defined in Section 3(5) of ERISA.
"Preferred Stock" means, as applied to the Capital Stock of any Person,
Capital Stock of any class or classes (however designated), which is preferred
as to the payment of distributions or dividends, or upon any voluntary or
involuntary liquidation or dissolution of such Person, over shares or units of
Capital Stock of any other class of such Person.
"Priority Debt" means as of any date of determination, the sum, without
duplication, of (i) Indebtedness of the Subsidiaries of the Borrower (other than
Indebtedness owed to the Borrower or another Wholly-Owned Subsidiary), plus (ii)
Indebtedness of the Borrower and its Subsidiaries secured by Liens permitted by
clauses (i) and (vii) of Section 7B.3 and any renewals of such Liens permitted
by clause (xiv) of Section 7B.3
"Property" means any interest in any kind of property or asset whether
real, personal, or mixed, or tangible or intangible.
"PUHCA" is defined in Section 8.20.
"Private Placement Notes" means the $120,000,000 senior secured notes
issued pursuant to the Memorandum, sold to the Purchasers and described and
defined in the Note Purchase Agreement as the "Notes."
"Redeemable Capital Stock" means, as of any date of determination, any
shares of any class or series of Capital Stock, that, either by the terms
thereof, by the terms of any security into which such shares are convertible or
exchangeable or by contract or otherwise, are or upon the happening of an event
or passage of time would be, required to be redeemed prior to the stated
maturity with respect to the principal of any Loans or are redeemable at the
option of the holder thereof at any time prior to the stated maturity of any
Loans, or are convertible into or exchangeable for Indebtedness at any time
prior to the stated maturity of any Loans.
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"Register" is defined in Section 11.1.3.
"Replacement Bank" is defined in Section 11.3.
"Required Banks" means, with respect to any approval, consent,
modification, waiver or other action to be taken by the Administrative Agent or
the Banks under the Loan Documents which require action by the Required Banks,
such Banks that own at least 66_% of the Percentage Interests; provided,
however, that with respect to any matters referred to in the proviso to Section
10.6, Required Banks means such Banks as own at least the respective portions of
the Percentage Interests required by Section 10.6.
"Responsible Officer" means the chief executive officer, chief
operating officer, chief financial officer or chief accounting officer of the
Borrower or any other officer of the Borrower involved principally in its
financial administration or its controllership function.
"Restricted Payment" means any payment or other distribution, direct or
indirect, in respect of any partnership or other equity interest in the
Borrower, except a distribution payable solely in additional partnership or
other equity interests in the Borrower, and any payment, direct or indirect on
account of the redemption, retirement, purchase or other acquisition of any
partnership or other equity interest in the Borrower.
"Sale and Lease-Back Transaction" means, with respect to any Person (a
"Transferor"), any arrangement (other than between the Borrower and a
Wholly-Owned Restricted Subsidiary or between Wholly-Owned Restricted
Subsidiaries) whereby (a) property (the "Subject Property") has been or is to be
disposed of by such Transferor to any other Person with the intention on the
part of such Transferor of taking back a lease of such Subject Property pursuant
to which the rental payments are calculated to amortize the purchase price of
such Subject Property substantially over the useful life of such Subject
Property, and (b) such Subject Property is in fact so leased by such Transferor
or an Affiliate of such Transferor.
"Securities Act" means the Securities Act of 1933, as amended.
"Security Agreement" shall mean the Security Agreement from the
Borrower and Heritage, as debtors and assignors, to the Collateral Agent, for
the benefit of the Banks and the Note Purchasers, as secured parties,
encumbering the Collateral described therein and covered thereby.
"Security Documents" shall mean the Security Agreement, the
Certificates and Stock Powers and the Financing Statements.
"Senior Debt" shall mean Indebtedness of the Borrower which is not
expressed to be junior or subordinate to any other Indebtedness of the Borrower.
"Service Revolver Notes" shall mean those certain promissory notes from
Heritage Service payable to the order of the Banks as more particularly
described in the Heritage Service Credit Agreement.
"Significant Subsidiary Group" shall mean any Subsidiary of the
Borrower, or any group of Subsidiaries of the Borrower, which at any time of
determination account for (or in the case of a recently formed or acquired
Subsidiary would have so accounted for on a pro forma basis) more than 5% of
consolidated operating revenues of the Borrower and its Subsidiaries for the
fiscal year most recently ended or more than 5% of consolidated total assets of
the Borrower and its Subsidiaries as of the end of the most recently ended
fiscal quarter, in each case computed in accordance with GAAP.
"Subordinated Units" shall have the meaning specified in the second
opening paragraph of the Note Purchase Agreement as in effect on the date
hereof.
"Subsidiary" shall mean, with respect to any Person, any corporation,
limited liability Borrower, partnership, joint venture, association, trust or
other entity of which (or in which) more than 50% of (a) the issued and
outstanding Capital Stock having ordinary voting power to elect a majority of
the board of directors of such
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corporation (irrespective of whether at the time Capital Stock of any other
class or classes of such corporation shall or might have voting power upon the
occurrence of any contingency), (b) the interests in the capital or profits of
such partnership, limited liability Borrower, joint venture or association with
ordinary voting power to elect a majority of the board of directors (or Persons
performing similar functions) of such partnership, limited liability Borrower,
joint venture or association, or (c) the beneficial interests in such trust or
other entity with ordinary voting power to elect a majority of the board of
trustees (or Persons performing similar functions) of such trust or other
entity, is at the time directly or indirectly owned or controlled by such
Person, by such Person and one or more of its other Subsidiaries, or by one or
more of such Person's other Subsidiaries. For the purposes of any computation
under Section 6A or clause (xiii) of Section 6B, the defined terms Consolidated
Debt Service, Consolidated EBITDA, Consolidated Funded Indebtedness,
Consolidated Interest Expense and Consolidated Pro Forma Maximum Debt Service
shall be calculated on the basis that Bi-State is a Subsidiary of the Borrower,
but only as long as the Borrower shall own 50% or more of the interests in the
capital or profits of Bi-State with ordinary voting power to elect a majority of
the board of directors (or Persons performing similar functions) thereof.
"Swaps" shall mean, with respect to any Person, payment obligations
(fixed or contingent) with respect to interest rate swap agreements, interest
rate cap agreements, interest rate collar agreements, currency swaps and similar
obligations obligating such Person to make payments, whether periodically or
upon the happening of a contingency. For the purposes of this Agreement, the
amount of the obligation under any Swap shall be the amount determined in
respect thereof as of the end of the then most recently ended fiscal quarter of
such Person, based on the assumption that such Swap had terminated at the end of
such fiscal quarter, and in making such determination, if any agreement relating
to such Swap provides for the netting of amounts payable by and to such Person
thereunder or if any such agreement provides for the simultaneous payment of
amounts by and to such Person, then in each such case, the amount of such
obligation shall be the net amount so determined.
"Tax" means any present or future tax, levy, duty, impost, deduction,
withholding or other charges of whatever nature at any time required by any Bank
Legal Requirement (i) to be paid by any Bank or (ii) to be withheld or deducted
from any payment otherwise required hereby to be made to any Bank, in each case
on or with respect to its obligations hereunder, the Loan, any payment in
respect of the Credit Obligations or any Funding Liability not included in the
foregoing; provided, however, that the term "Tax" shall not include taxes
imposed upon or measured by the net income of such Bank (other than withholding
taxes) or franchise taxes.
"Total Assets" means, as of any date of determination, the consolidated
total assets of the Borrower and its Subsidiaries as would be shown on a
consolidated balance sheet of the Borrower and its Subsidiaries prepared in
accordance with GAAP as of that date. See Section 1.2(i).
"Transactions" is defined in the third opening paragraph of the Note
Purchase Agreement as in effect on the date hereof.
"Tulsa Office" means the principal banking office of BOk in Tulsa,
Oklahoma.
"UCC" means the Uniform Commercial Code.
"Uniform Customs and Practice" is defined in Section 2.3.7.
"United States" or "U.S." means the United States of America.
"United States Funds" means such coin or currency of the United States
as at the time shall be legal tender therein for the payment of public and
private debts.
"Unused Proceeds Reserve" means, as of any date of determination, all
amounts theretofore offered to prepay Parity Debt under Section 7B.7(iii)(c)(II)
and to prepay Notes under Section 4.2, the prepayment of which was declined by
the applicable lenders, less the portion of such amounts theretofore applied by
the Borrower to operations or capital expenditures in connection with the
conduct of the Borrower's business.
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"Unutilized Taking Proceeds" means, as of any date, any insurance or
condemnation proceeds (net of the reasonable costs of proceedings in connection
therewith and settlements in respect thereof) in excess of $100,000 with respect
to any single occurrence that were received by the Borrower or any of its
Subsidiaries in respect of any damage, destruction, condemnation or other taking
of all or any portion of the properties or assets of the Borrower or any of its
Subsidiaries and that have not been reinvested by the Borrower or any of its
Subsidiaries within a period of twelve months after such receipt in the
restoration, modification or replacement of the properties or assets in respect
of which such insurance or condemnation proceeds were received.
"Voting Stock" means, with respect to any corporation, any shares of
stock of such corporation the holders of which are entitled under ordinary
circumstances to vote for the election of directors of such corporation
(irrespective of whether at the time stock of any other class or classes shall
have or might have voting power by reason of the happening of any contingency).
"Wholly-Owned" means, as applied to any Subsidiary of any Person, a
Subsidiary at least 98% (by vote or value) of the outstanding Equity Interests
(other than directors' qualifying shares, if required by law) of all classes,
taken together as a whole, of which are at the time owned by such Person or by
one or more of its Wholly-Owned Subsidiaries or by such Person and one or more
of its Wholly-Owned Subsidiaries.
"Withdrawal Liability" shall mean liability to a Multiemployer Plan as
a result of a complete or partial withdrawal from such Multiemployer Plan, as
such terms are defined in Part I of Subtitle E of Title IV of ERISA.
"Working Capital Facility" means the agreement of the Banks herein to
make Working Capital Loan and to provide for the issuance of Letters of Credit.
"Working Capital Loan Account" is defined in Section 2.2.4.
"Working Capital Loan" is defined in Section 2.2.4.
"Working Capital Notes" is defined in Section 2.2.4.
1.2 Accounting Principles, Terms and Determinations. All references in
this Agreement to "generally accepted accounting principles" or to "GAAP" shall
be deemed to refer to generally accepted accounting principles in effect in the
United States at the time of application thereof, but subject to the provisions
of this Section 1.2. Unless otherwise specified herein, all accounting terms
used herein shall be interpreted, all determinations with respect to accounting
matters hereunder shall be made, and all unaudited financial statements and
certificates and reports as to financial matters required to be prepared
hereunder shall be prepared in accordance with generally accepted accounting
principles, applied on a basis consistent with the most recent audited
consolidated financial statements of the Borrower and its Subsidiaries delivered
pursuant to clause (ii) of Section 7A.1.
1.3 Construction. Except as otherwise explicitly specified to the
contrary or unless the context clearly requires otherwise, (i) the capitalized
term "Section" refers to sections of this Agreement, (ii) the capitalized term
"Exhibit" refers to exhibits to this Agreement, (iii) references to a particular
Article Section include all subsections thereof, (iv) the word "including" shall
be construed as "including without limitation", (v) terms defined in the UCC and
not otherwise defined herein have the meaning provided under the UCC, (vi)
references to a particular statute or regulation include all rules and
regulations thereunder and any successor statute, regulation or rules, in each
case as from time to time in effect and (vii) references to a particular Person
include such Person's successors and assigns to the extent not prohibited by
this Agreement and the other Loan Documents. References to "the date hereof"
mean the date first set forth above.
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ARTICLE II
THE CREDITS
2.1 Acquisition Facility.
2.1.1 Acquisition Loan. Subject to all the terms and conditions of this
Agreement and so long as no Default exists, from time to time on and
after the Closing Date and prior to December 31, 2001 (the "Acquisition
Conversion Date") the Banks will, severally in accordance with their
respective Percentage Interests, make loans to the Borrower in such
amounts as may be requested by the Borrower in accordance with Section
2.1.3. The sum of the aggregate principal amount of loans made under
this Section 2.1.1 at any one time outstanding shall in no event exceed
the Maximum Amount of Acquisition Credit.
2.1.2 Maximum Amount of Acquisition Credit. The term "Maximum Amount of
Acquisition Credit" means, on any date on or prior to the Acquisition
Conversion Date, the remainder of (x) the lesser of (a) $30,000,000 or
(b) the aggregate Acquisition Loan Commitments described in Section
10.1, as amended from time to time, minus (y) the then aggregate
outstanding principal amount of the HHI Acquisition Notes, or such
lesser amount as the Borrower may specify from time to time by notice
from Borrower to the Administrative Agent and, after the Acquisition
Conversion Date, zero.
2.1.3 Acquisition Loan Borrowing Requests. The Borrower may from time
to time request a loan under Section 2.1.1 by providing to the
Administrative Agent either a notice in writing or telephonic notice
promptly confirmed in writing. Such notice must be not later than noon
(Tulsa, Oklahoma time) two (2) Banking Days prior to the requested
funding date for such loan. The notice must specify (a) the amount of
the requested loan (which shall be not less than $500,000 and in
integral multiples of $100,000 in excess thereof) and (b) the requested
funding date therefor (which shall be a Banking Day). Each such notice
shall be accompanied by (i) a memorandum from the Chief Financial
Officer of Borrower's general partner summarizing the proposed
acquisition or capital expenditures to be financed by the advance, (ii)
in the case of an acquisition a complete copy of the signed letter of
intent (with all exhibits or schedules thereto to the extent
available), (iii) a full and complete copy of the Borrower's internal
acquisition or capital expenditure model (in general form, content and
detail as utilized by the Borrower for similar acquisitions or capital
expenditures prior to the Closing Date) and, in the case of borrowings
hereunder relating to acquisitions or capital expenditures costing in
excess of $1,000,000 and in each other case in which the Required Banks
shall so request, calculations demonstrating Borrower's continued
compliance with the financial ratios of Section 7B.1(i) and (ii) hereof
as of and following the closing of such proposed acquisition or capital
expenditure (utilizing, for the purpose of such demonstration, and
subject to the calculation of Consolidated EBITDA resulting from such
proposed Asset Acquisition, including adjustments permitted thereby,
the financial statements of the Borrower and of the acquired business
or asset for the most recent period of twelve consecutive months (as
opposed to the immediately preceding four full fiscal quarters) for
which such statements are available), and (iv) a full, completed copy
of the confidential business questionnaire in the form as utilized by
Borrower prior to the Closing Date (collectively the "Acquisition/Capex
Due Diligence Packet"). Upon receipt of such notice, the Administrative
Agent will promptly inform each other Bank (by telephone or otherwise).
Each such loan will be made at the Administrative Agent's Tulsa Office
by depositing the amount thereof to the Disbursement Account of the
Borrower with the Administrative Agent. In connection with each such
loan, the Borrower shall furnish to the Administrative Agent a
certificate in substantially the form of Exhibit 2.1.3.
2.1.4 Acquisition Loan Account: Acquisition Notes. The Administrative
Agent will establish on its books an acquisition loan account for the
Borrower (the "Acquisition Loan Account") which such Administrative
Agent shall administer as follows: (a) the Administrative Agent shall
add to the Acquisition Loan Account, and the Acquisition Loan Account
shall evidence, the principal amount of all loans from time to time
made by the Banks to the Borrower pursuant to Section 2.1.1 and (b) the
Administrative Agent shall reduce the Acquisition Loan Account by the
amount of all payments made on account of the Obligation evidenced by
the Acquisition Loan Account. The aggregate principal amount of the
Indebtedness from time to time evidenced by the Acquisition Loan
Account is referred to as the "Acquisition Loan." The Acquisition Loan
shall be deemed owed to each Bank severally in accordance with such
Bank's Percentage Interest, and all payments credited to the
Acquisition Loan Account shall be for the account of each Bank in
accordance with its Percentage Interest. The Borrower's obligations to
pay each Bank's Percentage Interest in the Acquisition Loan shall be
evidenced by a separate note of the Borrower in substantially the form
of Exhibit 2.1.4 (the "Acquisition Notes"), payable to each Bank in
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maximum principal amount equal to such Bank's Percentage Interest in
the total Commitments constituting the Acquisition Facility.
2.2 Working Capital Facility.
2.2.1 Working Capital Loan. Subject to all the terms and conditions of
this Agreement and so long as no Default exists, from time to time on
and after the Closing Date and prior to the Final Maturity Date with
respect to the Working Capital Loan the Banks will, severally in
accordance with their respective Percentage Interests, make loans to
the Borrower in such amounts as may be requested by the Borrower in
accordance with Section 2.2.3. The sum of the aggregate principal
amount of loans made under this Section 2.2.1 at any one time
outstanding plus the Letter of Credit Exposure shall in no event exceed
the Maximum Amount of Working Capital Credit.
2.2.2 Maximum Amount of Working Capital Credit. The term "Maximum
Amount of Working Capital Credit" means, on any date, $20,000,000 minus
the outstanding principal balance on the Indebtedness permitted by
Section 7B.2(v) or such lesser amount as the Borrower may specify from
time to time by notice from the Borrower to the Administrative Agent;
provided that the aggregate outstanding principal amount of Working
Capital Loan shall be $0 for a period of not less than 30 consecutive
calendar days at least one time during each fiscal year of the Borrower
(the "Annual Clean-Up"). Failure by the Borrower to comply with the
provisions of the Annual Clean-Up shall constitute a failure to pay the
Loans when due and an Event of Default under Section 9.1.
2.2.3 Working Capital Borrowing Requests. The Borrower may from time
to time request a loan under Section 2.2.1 by providing to the
Administrative Agent, either a notice in writing or telephonic notice
promptly confirmed in writing. Such notice must be not later than noon
(Tulsa, Oklahoma time) on the Banking Day of the requested advance date
for such loan. The notice must specify (a) the amount of the requested
loan (which shall be not less than $100,000 and in integral multiples
of $50,000 in excess thereof) and (b) the requested advance date
therefor (which shall be a Banking Day). Upon receipt of such notice,
such Administrative Agent will promptly inform each other Bank (by
telephone or otherwise). Each such loan will be made at the
Administrative Agent's Tulsa Office by depositing the amount thereof to
the Borrower's operating account with the Administrative Agent. In
connection with each such loan, the Borrower shall furnish to the
Administrative Agent, a certificate in substantially the form of
Exhibit 2.2.3.
2.2.4 Working Capital Loan Account: Working Capital Notes. The
Administrative Agent, will establish on its books a working capital
loan account for the Borrower (the "Working Capital Loan Account"),
which such Administrative Agent shall administer as follows: (a) such
Administrative Agent shall add to the Working Capital Loan Account, and
the Working Capital Loan Account shall evidence, the principal amount
of all loans made from time to time by the Banks to the Borrower
pursuant to Section 2.2.1 and (b) such Administrative Agent shall
reduce the Working Capital Loan Account by the amount of all payments
made on account of the Indebtedness evidenced by the Working Capital
Loan Account. The aggregate principal amount of the Indebtedness
evidenced by the Working Capital Loan Account is referred to as the
"Working Capital Loan." The Working Capital Loan shall be deemed owed
to each Bank severally in accordance with such Bank's Percentage
Interest, and all payments credited to the working Capital Loan Account
shall be for the account of each Bank in accordance with its Percentage
Interest. The Borrower's obligations to pay each Bank's Percentage
Interest in the Working Capital Loan shall be evidenced by a separate
note of the Borrower in substantially the form of Exhibit 2.2.4 (the
"Working Capital Notes"), payable to each Bank in maximum principal
amount equal to such Bank's Percentage Interest in the total
Commitments constituting the Working Capital Facility.
2.3 Letters of Credit.
2.3.1 Issuance of Letters of Credit. Subject to all the terms and
conditions of this Agreement and so long as no Default exists, from
time to time on and after the Closing Date and prior to 30 days prior
to the Final Maturity Date with respect to the Working Capital Loan,
the Letter of Credit Issuer will issue for the account of the Borrower
one or more irrevocable documentary or standby letters of credit (the
"Letters of
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Credit"). Letter of Credit Exposure plus the Working Capital Loan shall
in no event exceed the Maximum Amount of Working Capital Credit. Letter
of Credit Exposure shall in no event exceed $5,000,000.
2.3.2 Requests for Letters of Credit. The Borrower may from time to
time request a Letter of Credit to be issued by providing to the Letter
of Credit Issuer (and the Administrative Agent if the Letter of Credit
Issuer is not the Administrative Agent) a notice which is actually
received not less than one (1) Banking Day prior to the requested
issuance date for such Letter of Credit specifying (a) the amount of
the requested Letter of Credit, (b) the beneficiary thereof, (c) the
requested issuance date and (d) the principal terms of the text for
such Letter of Credit. Each Letter of Credit will be issued by
forwarding it to the Borrower or to such other Person as directed in
writing by the Borrower. In connection with the issuance of any Letter
of Credit, the Borrower shall furnish to the Letter of Credit Issuer
(and the Administrative Agent if the Letter of Credit Issuer is not the
Administrative Agent) a certificate in substantially the form of
Exhibit 2.3.2. and any customary application forms required by the
Letter of Credit Issuer.
2.3.3 Form and Expiration of Letters of Credit. Each Letter of Credit
issued under this Section 2.3 and each draft accepted or paid under
such a Letter of Credit shall be issued, accepted or paid, as the case
may be, by the Letter of Credit Issuer at its principal office. No
Letter of Credit shall provide for the payment of drafts drawn
thereunder, and no draft shall be payable, at a date which is later
than the earlier of (a) the date twelve months after the date of
issuance or (b) 15 days prior to the Final Maturity Date with respect
to the Working Capital Loans. Each Letter of Credit and each draft
accepted under a Letter of Credit shall be in such form and minimum
amount, and shall contain such terms, as the Letter of Credit Issuer
and the Borrower may agree upon at the time such Letter of Credit is
issued, including a requirement of not less than three Banking Days
after presentation of a draft before payment must be made thereunder.
2.3.4 Banks' Participation in Letters of Credit. Upon the issuance of
any Letter of Credit, a participation therein, in an amount equal to
each Bank's Percentage Interest, shall automatically be deemed granted
by the Letter of Credit Issuer to each Bank on the date of such
issuance and the Banks shall automatically be obligated, as set forth
in Section 10.4, to reimburse the Letter of Credit Issuer to the extent
of their respective Percentage Interests for all obligations incurred
by the Letter of Credit Issuer to third parties in respect of such
Letter of Credit not reimbursed by the Borrower. The Letter of Credit
Issuer will send to each Bank (and the Administrative Agent if the
Letter of Credit Issuer is not the Administrative Agent) a confirmation
regarding the participations in Letters of Credit outstanding during
such month.
2.3.5 Presentation. The Letter of Credit Issuer may accept or pay any
draft presented to it, regardless of when drawn and whether or not
negotiated, if such draft, the other required documents and any
transmittal advice are presented to the Letter of Credit Issuer and
dated on or before the expiration date of the Letter of Credit under
which such draft is drawn. Except insofar as instructions actually
received may be given by the Borrower in writing expressly to the
contrary with regard to, and prior to, the Letter of Credit Issuer's
issuance of any Letter of Credit for the account of the Borrower and
such contrary instructions are reflected in such Letter of Credit, to
the maximum extent permitted by law the Letter of Credit Issuer may
honor as complying with the terms of the Letter of Credit and with this
Agreement any drafts or other documents otherwise in order signed or
issued by an administrator, executor, conservator, trustee in
bankruptcy, debtor in possession, assignee for benefit of creditors,
liquidator, receiver or other legal representative of the party
authorized under such Letter of Credit to draw or issue such drafts or
other documents.
2.3.6 Payment of Drafts. At such time as a Letter of Credit Issuer
makes any payment on a draft presented or accepted under a Letter of
Credit, the Borrower will on demand pay to such Letter of Credit Issuer
in immediately available funds the amount of such payment. Unless the
Borrower shall otherwise pay to the Letter of Credit Issuer the amount
required by the foregoing sentence, such amount shall be considered a
loan under Section 2.2.1 and part of the Working Capital Loan.
2.3.7 Uniform Customs and Practice. The Uniform Customs and Practice
for Documentary Credits (1993 Revision), International Chamber of
Commerce Publication No. 500, and any subsequent revisions thereof
approved by a Congress of the International Chamber of Commerce and
adhered to by the Letter of Credit Issuer (the "Uniform Customs and
Practice"), shall be binding on the Borrower and the Letter of Credit
Issuer except to the extent otherwise provided herein, in any Letter of
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Credit or in any other Loan Document. Anything in the Uniform Customs
and Practice to the contrary notwithstanding:
(a) Neither the Borrower nor any beneficiary of any Letter of Credit
shall be deemed an agent of any Letter of Credit Issuer.
(b) With respect to each Letter of Credit, neither any Letter of Credit
Issuer nor its correspondents shall be responsible, except to the
extent required by law, for or shall have any duty to ascertain:
(i) the genuineness of any signature;
(ii) the validity, form, sufficiency, accuracy,
genuineness or legal effect of any endorsements;
(iii) delay in giving, or failure to give, notice of
arrival, notice of refusal of documents or of discrepancies in respect
of which any Letter of Credit Issuer refuses the documents or any other
notice, demand or protest;
(iv) the performance by any beneficiary under any Letter
of Credit of such beneficiary's obligations to the Borrower;
(v) inaccuracy in any notice received by the Letter of
Credit Issuer;
(vi) the validity, form, sufficiency, accuracy,
genuineness or legal effect of any instrument, draft, certificate or
other document required by such Letter of Credit to be presented before
payment of a draft, or the office held by or the authority of any
Person signing any of the same; or
(vii) failure of any instrument to bear any reference or
adequate reference to such Letter of Credit, or failure of any Person
to note the amount of any instrument on the reverse of such Letter of
Credit or to surrender such Letter of Credit or to forward documents in
the manner required by such Letter of Credit.
(c) Except as otherwise required by law, the occurrence of any of the
events referred to in the Uniform Customs and Practice or in the
preceding clauses of this Section 2.3.7 shall not affect or prevent the
vesting of any of the Letter of Credit Issuer's rights or powers
hereunder or the Borrower's obligation to make reimbursement of amounts
paid under any Letter of Credit or any draft accepted thereunder.
(d) The Borrower will promptly examine (i) each Letter of Credit (and
any amendments thereof) sent to it by a Letter of Credit Issuer and
(ii) all instruments and documents delivered to it from time to time by
such Letter of Credit Issuer. The Borrower will notify the Letter of
Credit Issuer of any claim of noncompliance by notice actually received
within three Banking Days after receipt of any of the foregoing
documents, the Borrower being conclusively deemed to have waived any
such claim against such Letter of Credit Issuer and its correspondents
unless such notice is given. The Letter of Credit Issuer shall have no
obligation or responsibility to send any such Letter of Credit or any
such instrument or document to the Borrower.
(e) In the event of any conflict between the provisions of this
Agreement and the Uniform Customs and Practice and Article 5 of the
Uniform Commercial Code, the provisions of this Agreement shall govern
to the maximum extent permitted by applicable law.
2.3.8 Subrogation. Subject to the terms of the Intercreditor
Agreement, upon any payment by a Letter of Credit Issuer under any
Letter of Credit and until the reimbursement of such Letter of Credit
Issuer by the Borrower with respect to such payment, the Letter of
Credit Issuer shall be entitled to be subrogated to, and to acquire and
retain, the rights which the Person to whom such payment is made may
have against the Borrower, all for the benefit of the Banks. Subject to
the terms of the Intercreditor Agreement, the Borrower will take such
action as the Letter of Credit Issuer may reasonably request, including
requiring the beneficiary of any Letter of Credit to execute such
documents as the Letter of Credit Issuer may
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reasonably request, to assure and confirm to the Letter of Credit
Issuer such subrogation and such rights, including the rights, if any,
of the beneficiary to whom such payment is made in accounts receivable,
inventory and other properties and assets of the Borrower.
2.3.9 Modification, Consent, etc. If the Borrower requests or consents
in writing to any modification or extension of any Letter of Credit, or
waives any failure of any draft, certificate or other document to
comply with the terms of such Letter of Credit, and if the Letter of
Credit Issuer consents thereto, the Letter of Credit Issuer shall be
entitled to rely on such request, consent or waiver. This Agreement
shall be binding upon the Borrower with respect to such Letter of
Credit as so modified or extended, and with respect to any action taken
or omitted by such Letter of Credit Issuer pursuant to any such
request, consent or waiver.
2.4 Application of Proceeds.
2.4.1 Acquisition Loan. The Borrower will apply the proceeds of the
Acquisition Loan solely to finance acquisitions permitted pursuant to
Section 2.1 and to finance capital expenditures for additions or
improvements to the assets of the Borrower (as distinguished from
maintenance capital expenditures).
2.4.2 Working Capital Loan. The Borrower will apply the proceeds of the
Working Capital Loan for working capital and other lawful purposes of
the Borrower and its Subsidiaries; provided, however, that at no time
shall more than $500,000 of the outstanding principal amount of the
Working Capital Loan have been applied to the purposes of financing
acquisitions permitted pursuant to Section 2.1 and/or capital
expenditures for additions or improvements to the Assets of the
Borrower (as distinguished from maintenance capital expenditures).
2.4.3 Letters of Credit. Letters of Credit shall be issued only for
lawful purposes of the Borrower and its Subsidiaries.
2.4.4 Specifically Prohibited Applications. The Borrower will not,
directly or indirectly, apply any part of the proceeds of any extension
of credit made pursuant to the Loan Documents to purchase or to carry
Margin Stock or to any transaction prohibited by the Foreign Trade
Regulations, by other Bank Legal Requirements of applicable to the
Banks or by the Loan Documents.
2.5 Nature of Obligations of Banks to Make Extensions of Credit. The
Banks' obligations to extend credit under this Agreement are several and are not
joint or joint and several. If on the date any Loans are to be made, any Bank
shall fail to perform its obligations under this Agreement, the aggregate amount
of Commitments to make the extensions of credit under this Agreement shall be
reduced by the amount of unborrowed Commitments of the Bank so failing to
perform and the Percentage Interests shall be appropriately adjusted. Banks that
have not failed to perform their obligations to make the extensions of credit
contemplated by Section 2 may, if any such Bank so desires, assume, in such
proportions as such Banks may agree, the obligations of any Bank who has so
failed and the Percentage Interests shall be appropriately adjusted. The
provisions of this Section 2.5 shall not affect the rights of the Borrower
against any Bank failing to perform its obligations hereunder.
ARTICLE III
INTEREST; EURODOLLAR PRICING OPTIONS; FEES
3.1 Interest. Each Loan shall accrue and bear interest at a rate per
annum which shall at all times equal its Applicable Rate. Prior to any stated or
accelerated maturity of any Loan, the Borrower will, on the last day of each
month, commencing June 30, 1999, pay the accrued and unpaid interest on the
portion of such Loan which was not subject to a Eurodollar Pricing Option. On
the last day of each Eurodollar Interest Period or on any earlier termination of
any Eurodollar Pricing Option, the Borrower will pay the accrued and unpaid
interest on the portion of such Loan which was subject to the Eurodollar Pricing
Option which expired or terminated on such date. On the Final Maturity Date or
the earlier accelerated maturity of any Loan, the Borrower will pay all accrued
and unpaid interest on such Loan, including any accrued and unpaid interest on
any portion of such Loan which is subject to a Eurodollar Pricing Option. Upon
the occurrence and during the continuance of an Event of Default, the Banks may
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require accrued interest to be payable on demand or at regular intervals more
frequent than each Payment Date. All payments of interest hereunder shall be
made to the Administrative Agent, for the account of each Bank in accordance
with such Bank's Percentage Interest.
3.2 Eurodollar Pricing Options.
3.2.1 Election of Eurodollar Pricing Options. Subject to all of the
terms and conditions hereof and so long as no Default exists, the
Borrower may from time to time, by irrevocable notice to the
Administrative Agent, actually received not less than one (1) Banking
Day prior to the commencement of the Eurodollar Interest Period
selected in such notice, elect to have such portion of a Loan as the
Borrower may specify in such notice accrue and bear interest during the
Eurodollar Interest Period so selected at the Applicable Rate computed
on the basis of the Eurodollar Rate. No such election shall become
effective:
(i) if, prior to the commencement of any such
Eurodollar Interest Period, the Administrative Agent
determines that (i) the electing or granting of the Eurodollar
Pricing Option in question would violate a Bank Legal
Requirement, (ii) Eurodollar deposits in an amount comparable
to the principal amount of the Loan as to which such
Eurodollar Pricing Option has been elected and which have a
term corresponding to the proposed Eurodollar Interest Period
are not readily available in the inter-bank Eurodollar market,
or (iii) by reason of circumstances affecting the inter-bank
Eurodollar market, adequate and reasonable methods do not
exist for ascertaining the interest rate applicable to such
deposits for the proposed Eurodollar Interest Period; or
(ii) if any Bank shall have advised the
Administrative Agent, by telephone or otherwise at or prior to
noon (Tulsa, Oklahoma time) on the Banking Day immediately
prior to the commencement of such proposed Eurodollar Interest
Period (and shall have subsequently confirmed in writing)
that, after reasonable efforts to determine the availability
of such Eurodollar deposits, such Bank reasonably anticipates
that Eurodollar deposits in an amount equal to the Percentage
Interest of such Bank in the portion of such Loan as to which
such Eurodollar Pricing Option has been elected and which have
a term corresponding to the Eurodollar Interest Period in
question will not be offered in the Eurodollar market to such
Bank at a rate of interest that does not exceed the
anticipated Eurodollar Basic Rate.
3.2.2 Notice to Banks and Borrower. The Administrative Agent,
will promptly inform each Bank (by telephone or otherwise) of each
notice received by it from the Borrower pursuant to Section 3.2.1 and
of the Eurodollar Interest Period specified in such notice. Upon
determination by the Administrative Agent of the Eurodollar Rate for
such Eurodollar Interest Period or in the event such election shall not
become effective, the Administrative Agent, will promptly notify the
Borrower and each Bank (by telephone or otherwise) of the Eurodollar
Rate so determined or why such election did not become effective, as
the case may be.
3.2.3 Selection of Eurodollar Interest Periods. Eurodollar
Interest Periods shall be selected so that:
(i) the minimum portion of a Loan subject to any
Eurodollar Pricing Option shall be $1,000,000 and in integral
multiple of $100,000 in excess thereof;
(ii) no more than a total of fifteen (15) Eurodollar
Pricing Options shall be outstanding at any one time with
respect to the Loans;
(iii) no Eurodollar Interest Period with respect to
any part of a Loan subject to a Eurodollar Pricing Option
shall expire later than its applicable Final Maturity Date.
3.2.4 Additional Interest. If any portion of a Loan subject to
a Eurodollar Pricing Option is repaid, or any Eurodollar Pricing Option
is terminated for any reason (including acceleration of maturity), on a
date which is prior to the last Banking Day of the Eurodollar Interest
Period applicable to such
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Eurodollar Pricing Option, the Borrower will pay to the Administrative
Agent, for the account of each Bank in accordance with such Bank's
Percentage Interest, in addition to any amounts of interest otherwise
payable hereunder, an amount equal to the present value (calculated in
accordance with this Section 3.2.4) of interest for the unexpired
portion of such Eurodollar Interest Period on the portion of such Loan
so repaid, or as to which a Eurodollar Pricing Option was so
terminated, at a per annum rate equal to the excess, if any, of (a) the
rate applicable to such Eurodollar Pricing Option minus, (b) the lowest
rate of interest obtainable by the Administrative Agent upon the
purchase of debt securities customarily issued by the Treasury of the
United States of America which have a maturity date approximating the
last Banking Day of such Eurodollar Interest Period. The present value
of such additional interest shall be calculated by discounting the
amount of such interest for each day in the unexpired portion of such
Eurodollar Interest Period from such day to the date of such repayment
or termination at a per annum interest rate equal to the interest rate
determined pursuant to clause (b) of the preceding sentence, and by
adding all such amounts for all such days during such period. The
determination by the Administrative Agent of such amount of interest
shall, in the absence of manifest error, be conclusive. For purposes of
this Section 3.2.4, if any portion of a Loan which was to have been
subject to a Eurodollar Pricing Option is not outstanding on the first
day of the Eurodollar Interest Period applicable to such Eurodollar
Pricing Option other than for reasons described in Section 3.2.1, the
Borrower shall be deemed to have terminated such Eurodollar Pricing
Option.
3.2.5 Violation of Bank Legal Requirements. If any Bank Legal
Requirement shall prevent any Bank from funding or maintaining through
the purchase of deposits in the interbank Eurodollar market any portion
of a Loan subject to a Eurodollar Pricing Option or otherwise from
giving effect to such Bank's obligations as contemplated by Section
3.2, (a) the Administrative Agent, may by notice to the Borrower
terminate all of the affected Eurodollar Pricing Options, (b) the
portion of such Loan subject to such terminated Eurodollar Pricing
Options shall immediately bear interest thereafter at the Applicable
Rate computed on the basis of the Base Rate and (c) the Borrower shall
make any payment required by Section 3.2.4.
3.2.6 Funding Procedure. The Banks may fund any portion of a
Loan subject to a Eurodollar Pricing Option out of any funds available
to the Banks. Regardless of the source of the funds actually used by
any of the Banks to fund any portion of such Loan subject to a
Eurodollar Pricing Option, however, all amounts payable hereunder,
including the interest rate applicable to any such portion of the Loan
and the amounts payable under Sections 3.2.4, 3.5, 3.6, 3.7 and 3.8,
shall be computed as if each Bank had actually funded such Bank's
Percentage Interest in such portion of such Loan through the purchase
of deposits in such amount of the type by which the Eurodollar Basic
Rate was determined with a maturity the same as the applicable
Eurodollar Interest Period relating thereto and through the transfer of
such deposits from an office of the Bank having the same location as
the applicable Eurodollar Office to one of such Bank's offices in the
United States of America.
3.3 Commitment Fees.
3.3.1 Acquisition Financing Facility. In consideration of the
Banks' Commitments to make the extensions of credit provided for in
Section 2.1, while such commitments are outstanding, the Borrower will
pay to the Administrative Agent, for the account of the Banks in
accordance with the Banks' respective Percentage Interests, within five
(5) Banking Days following the end of each fiscal quarter of the
Borrower prior to the Acquisition Conversion Date and on the
Acquisition Conversion Date, an amount equal to interest computed at
the rate per annum equal to the Applicable Commitment Fee Percentage
multiplied by the amount by which (a) the average daily Maximum Amount
of Acquisition Credit during the Margin Period or portion thereof
ending on the last day of such fiscal quarter or the Acquisition
Conversion Date exceeded (b) the average daily Acquisition Loan during
such Margin Period or portion thereof.
3.3.2 Working Capital Facility. In consideration of the Banks'
commitments to make the extension of credit provided for in Section 2.2
while such commitments are outstanding, the Borrower will pay to the
Administrative Agent, for the account of the Banks in accordance with
the Banks' respective Percentage Interests, within five (5) Banking
Days following the end of each fiscal quarter of the Borrower and on
the Final Maturity Date with respect to the Working Capital Loan, an
amount equal to interest
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computed at the rate per annum equal to the Applicable Commitment Fee
Percentage multiplied by the amount by which (a) the average daily
Maximum Amount of Working Capital Credit during the Margin Period or
portion thereof ending on the last day of such fiscal quarter or Final
Maturity Date exceeded (b) the average daily Working Capital Loan
during such Margin Period or portion thereof.
3.4 Letter of Credit Fees. The Borrower will pay to the Administrative
Agent, for the account of each of the Banks (including any Letter of Credit
Issuer), in accordance with the Banks' respective Percentage Interests, on the
last day of each Margin Period, a Letter of Credit fee equal to the Applicable
Margin for Eurodollar Loans in effect for such Margin Period on the average
daily Letter of Credit Exposure during such Margin Period; provided, however,
that a portion of such fee equal to 1/8% per annum on the Letter of Credit
Exposure shall be paid solely to the respective Letter of Credit Issuer. The
Borrower also will pay to each Letter of Credit Issuer customary service charges
and expenses for its services in connection with the Letters of Credit issued by
it at the times and in the amounts from time to time in effect in accordance
with its general rate structure, including fees and expenses relating to
issuance, amendment, negotiation, cancellation and similar operations.
3.5 Reserve Requirements, etc. If any Bank Legal Requirement shall (a)
impose, modify, increase or deem applicable any insurance assessment, reserve,
special deposit or similar requirement against any Funding Liability or the
Letters of Credit, (b) impose, modify, increase or deem applicable any other
requirement or condition with respect to any Funding Liability or the Letters of
Credit, or (c) change the basis of taxation of Funding Liabilities or payments
in respect of any Letter of Credit (other than changes in the rate of taxes
measured by the overall net income of such Bank) and the effect of any of the
foregoing shall be to increase the cost to any Bank of issuing, making, funding
or maintaining its respective Percentage Interest in any portion of a Loan
subject to a Eurodollar Pricing Option or any Letter of Credit, to reduce the
amounts received or receivable by such Bank under this Agreement or to require
such Bank to make any payment or forego any amounts otherwise payable to such
Bank under this Agreement, then, within 15 days after the receipt by the
Borrower of a certificate from such Bank setting forth why it is claiming
compensation under this Section 3.5 and computations (in reasonable detail) of
the amount thereof, the Borrower shall pay to the Administrative Agent, for the
account of such Bank such additional amounts as are specified by such Bank in
such certificate as sufficient to compensate such Bank for such increased cost
or such reduction, together with interest at the Overdue Reimbursement Rate on
such amount from the 15th day after receipt of such certificate until payment in
full thereof; provided, however, that the foregoing provisions shall not apply
to any Tax or to any reserves which are included in computing the Eurodollar
Reserve Rate. The determination by such Bank of the amount of such costs shall,
in the absence of manifest error, be conclusive.
3.6 Taxes. All payments of the Credit Obligations shall be made without
set-off or counterclaim and free and clear of any deductions, including
deductions for Taxes, unless the Borrower is required by law to make such
deductions. If (a) any Bank shall be subject to any Tax with respect to any
payment of the Credit Obligations or its obligations hereunder or (b) the
Borrower shall be required to withhold or deduct any Tax on any payment on the
Credit Obligations, within 15 days after the receipt by the Borrower of a
certificate from such Bank setting forth why it is claiming compensation under
this Section 3.6 and computations (in reasonable detail) of the amount thereof,
the Borrower shall pay to the Administrative Agent, for such Bank's account such
additional amount as is necessary to enable such Bank to receive the amount of
Tax so imposed on the Bank's obligations hereunder or the full amount of all
payments which it would have received on the Credit Obligations (including
amounts required to be paid under Sections 3.5, 3.7, 3.8 and this Section 3.6)
in the absence of such Tax, as the case may be, together with interest at the
Overdue Reimbursement Rate on such amount from the 15th day after receipt of
such certificate until payment in full thereof. Whenever Taxes must be withheld
by the Borrower with respect to any payments of the Credit Obligations, the
Borrower shall promptly furnish to the Administrative Agent for the account of
the applicable Bank official receipts (to the extent that the relevant
governmental authority delivers such receipts) evidencing payment of any such
Taxes so withheld. If the Borrower fails to pay any such Taxes when due or fails
to remit to the Administrative Agent, for the account of the applicable Bank the
required receipts evidencing payment of any such Taxes so withheld or deducted,
the Borrower shall indemnify the affected Bank for any incremental Taxes and
interest or penalties that may become payable by such Bank as a result of any
such failure. The determination by such Bank of the amount of such Tax and the
basis therefor shall, in the absence of manifest error, be conclusive. The
Borrower shall be entitled to replace any such Bank in accordance with Section
11.3.
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3.7 Capital Adequacy. If any Bank shall determine that compliance by
such Bank with any Bank Legal Requirement regarding capital adequacy of banks or
bank holding companies has or would have the effect of reducing the rate of
return on the capital of such Bank and its Affiliates as a consequence of such
Bank's commitment to make the extensions of credit contemplated hereby, or such
Bank's maintenance of the extensions of credit contemplated hereby, to a level
below that which such Bank could have achieved but for such compliance (taking
into consideration the policies of such Bank and its Affiliates with respect to
capital adequacy immediately before such compliance and assuming that the
capital of such Bank and its Affiliates was fully utilized prior to such
compliance) by an amount deemed by such Bank to be material, then, within 15
days after the receipt by the Borrower of a certificate from such Bank setting
forth why it is claiming compensation under this Section 3.7 and computations
(in reasonable detail) of the amount thereof, the Borrower shall pay to the
Administrative Agent, for the account of such Bank such additional amounts as
shall be sufficient to compensate such Bank for such reduced return, together
with interest at the Overdue Reimbursement Rate on each such amount from the
15th day after receipt of such certificate until payment in full thereof. The
determination by such Bank of the amount to be paid to it and the basis for
computation thereof shall, in the absence of manifest error, be conclusive. In
determining such amount, such Bank may use any reasonable averaging, allocation
and attribution methods. The Borrower shall be entitled to replace any such Bank
in accordance with Section 11.3.
3.8 Regulatory Changes. If any Bank shall determine that (a) any change
in any Bank Legal Requirement (including any new Bank Legal Requirement) after
the date hereof shall directly or indirectly (i) reduce the amount of any sum
received or receivable by such Bank with respect to a Loan or the Letters of
Credit or the return to be earned by such Bank on such Loan or the Letters of
Credit, (ii) impose a cost on such Bank or any Affiliate of such Bank that is
attributable to the making or maintaining of, or such Bank's commitment to make,
its portion of such Loan or the Letters of Credit, or (iii) require such Bank or
any Affiliate of such Bank to make any payment on, or calculated by reference
to, the gross amount of any amount received by such Bank under any Credit
Document, and (b) such reduction, increased cost or payment shall not be fully
compensated for by an adjustment in the Applicable Rate or the Letter of Credit
fees, then, within 15 days after the receipt by the Borrower of a certificate
from such Bank setting forth why it is claiming compensation under this Section
3.8 and computations (in reasonable detail) of the amount thereof, the Borrower
shall pay to such Bank such additional amounts as such Bank determines will,
together with any adjustment in the Applicable Rate, fully compensate for such
reduction, increased cost or payment, together with interest on such amount from
the 15th day after receipt of such certificate until payment in full thereof at
the Overdue Reimbursement Rate. The determination by such Bank of the amount to
be paid to it and the basis for computation thereof hereunder shall, in the
absence of manifest error, be conclusive. In determining such amount, such Bank
may use any reasonable averaging and attribution methods.
3.9 Computations of Interest and Fees. For purposes of this Agreement,
interest, commitment fees and Letter of Credit fees (and any other amount
expressed as interest or such fees) shall be computed on the basis of a 360-day
year for actual days elapsed. If any payment required by this Agreement becomes
due on any day that is not a Banking Day, such payment shall, except as
otherwise provided in the Eurodollar Interest Period, be made on the next
succeeding Banking Day. If the due date for any payment of principal is extended
as a result of the immediately preceding sentence, interest shall be payable for
the time during which payment is extended at the Applicable Rate, but any letter
of credit fees payable pursuant to Section 3.4 shall not be increased as a
result of such extension.
3.10 Administrative Agent's Fees. The Borrower shall pay to the
Administrative Agent, for the Administrative Agent's own account, an annual fee
in the amount of $25,000, payable quarterly (in the amount of $6,250) in arrears
following the close of each calendar quarter by the Administrative Agent's debit
to Borrower's operating account, concerning which quarterly debit therefrom
Borrower hereby authorizes the Administrative Agent to automatically effect
without the necessity of any further or other approval from the Borrower.
3.11 Co-Agent's Fees. The Borrower shall pay to the Co-Agent, for the
Co-Agent's own account, a one time agent fee in the amount of $10,000.
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ARTICLE IV
PAYMENT
4.1 Payment at Maturity. On the Final Maturity Date with respect to
each tranche or any accelerated maturity of such Loan, the Borrower will pay to
the Administrative Agent, for the account of the Banks an amount equal to the
remaining aggregate principal amount of such Tranche then outstanding, together
with all accrued and unpaid interest thereon and all other Credit Obligations
then outstanding.
4.2 Contingent Required Prepayments.
4.2.1 Excess Credit Exposure. If at any time the Acquisition
Loan (prior to the Acquisition Conversion Date) or the Working Capital
Loan exceeds the limit set forth in Section 2.1.2 or 2.2.2,
respectively, the Borrower shall within three Banking Days pay the
amount of such excess to the Administrative Agent, for the account of
the Banks.
4.2.2 Letter of Credit Exposure. If at any time the Letter of
Credit Exposure exceeds the limit set forth in Section 2.3.1, the
Borrower shall within three Banking Days pay the amount of such excess
to the Administrative Agent, for the account of the Banks to be applied
as provided in Section 4.5.
4.2.3 Contingent Prepayments on Disposition, Loss of Assets,
Merger or Change of Control.
(i) If at any time the Borrower or any of its
Subsidiaries disposes of assets or issues or sells Capital
Stock of any Subsidiary with the result that there are Excess
Sale Proceeds, and the Borrower does not apply such Excess
Sale Proceeds in the manner described in Section
7B.7(iii)(c)(ii)(x), the Borrower will prepay (at the price of
the principal amount prepaid plus accrued interest thereon and
any amount owing with respect thereto under Section 3.2.4 and
upon notice as provided in Section 4.2.4) a principal amount
of the outstanding Acquisition Notes equal to the Allocable
Proceeds.
(ii) In the event of any damage to, or destruction,
condemnation or other taking of, all or any portion of the
properties or assets of the Borrower or any of its
Subsidiaries, to the extent that the Borrower or any such
Subsidiary receives insurance or condemnation proceeds with
the result that Unutilized Taking Proceeds exceed $2,500,000
in respect of any fiscal year (such excess amount being herein
called "Excess Taking Proceeds"), the Borrower will prepay (at
the price of the principal amount prepaid plus accrued
interest thereon and any amount owing with respect thereto
under Section 3.2.4 and upon notice as provided in
Section 4.2.4) a principal amount of the outstanding
Acquisition Notes equal to the Allocable Proceeds.
(iii) (a) If at any time any Responsible Officer has
knowledge of the occurrence of any Control Event, the Borrower
will give notice as provided in Section 4.4 of such Control
Event to the Administrative Agent. Upon the occurrence of a
Control Event, the Borrower will not take any voluntary action
that consummates or finalizes the Control Event resulting from
such Control Event unless contemporaneously with such action,
the Borrower prepays all Notes in accordance with this Section
4.2.3(iii) and upon notice as provided in Section 4.2.4 at the
price of the principal amount thereof plus accrued interest
thereon and any amount owing with respect thereto under
Section 3.2.4.
(b) The obligation of the Borrower to prepay
Acquisition Notes pursuant to the offer required by paragraph
(a) of this clause (iii) and accepted in accordance with
Section 4.2.4 is subject to the consummation of the Control
Event in respect of which any such offer and acceptance shall
have been made. In the event that such Control Event does not
occur on or before the proposed prepayment date in respect
thereof, the prepayment shall be deferred until and shall be
made on the date on which such Control Event occurs. The
Borrower shall keep the Administrative Agent reasonably and
timely informed of (i) any such deferral of the date of
prepayment, (ii) the date on which such Control Event and the
prepayment are expected to occur,
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and (iii) any determination by the Borrower that efforts to
effect such resulting Control Event have ceased or been
abandoned (in which case the Borrower shall have no further
obligation hereunder to prepay the Acquisition Notes in
respect of such Control Event).
4.2.4 Prepayment Procedure for Contingent Prepayments.
(i) If at any time there are unapplied Excess Sale Proceeds or
Excess Taking Proceeds (such unapplied amounts being "Excess
Proceeds"), and the Borrower is required to prepay the Acquisition
Notes with such Excess Proceeds pursuant to clause (i) or (ii) of
Section 4.2.3, the Borrower will give written notice as provided in
Section 12.1 (which shall be in the form of an Officers' Certificate)
to the Banks not later than twelve months after the date of the
applicable Asset Sale or the end of the twelve month period following
receipt of the applicable Unutilized Taking Proceeds, as the case may
be, and (a) setting forth in reasonable detail all calculations
required to determine the amount of Excess Proceeds, (b) setting forth
the aggregate amount of the Allocable Proceeds and the amount of the
Allocable Proceeds which is allocable to each Acquisition Note,
determined by applying the Allocable Proceeds pro rata among all
Acquisition Notes outstanding on the date such prepayment is to be made
according to the aggregate then unpaid amounts of the Acquisition
Notes, and in reasonable detail the calculations used in determining
such amounts, and (c) stating that the Borrower will prepay on the date
specified in such notice, which shall not be less than 25 nor more than
45 days after the date of such notice, a principal amount of each
outstanding Acquisition Note equal to the amount of Allocable Proceeds
allocated to such Acquisition Note as described in clause (b) above.
(ii) If at any time the Borrower is required to prepay the
Notes following the occurrence of a Control Event, the Borrower will
give written notice as provided in Section 12.1 (which shall be in the
form of an Officer's Certificate) to the Banks not later than five
Business Days following such Control Event, (a) setting forth in
reasonable detail the facts and circumstances underlying such Control
Event known to it, and (b) stating that the Borrower will prepay on the
date the Control Event occurs.
4.3 Scheduled Required Payments/Prepayments.
4.3.1 Payments on the Acquisition Loan. On each Payment Date
occurring after the Acquisition Conversion Date, the Borrower shall pay
1/10th of the Acquisition Loan outstanding on the Acquisition
Conversion Date, after giving effect to all prepayments thereon;
provided, however, on the Final Maturity Date of the Acquisition Loan,
the Borrower shall pay all outstanding principal of the Acquisition
Loan.
4.3.2 Working Capital Loan. The Borrower shall prepay the
Working Capital Loan when necessary to comply with the Annual Clean-Up
requirement set forth in the proviso to Section 2.2.2.
4.4 Voluntary Prepayments. In addition to the prepayments required by
Sections 4.2 and 4.3, the Borrower may from time to time prepay all or any
portion of the Loans (in a minimum amount of $100,000 and an integral multiple
of $50,000), without premium or penalty of any type (except as provided in
Section 3.2.4 with respect to the early termination of Eurodollar Pricing
Options). The Borrower shall give the Administrative Agent at least one Banking
Day prior notice of its intention to prepay, specifying the date of payment, the
total amount of the Loans to be paid on such date and the amount of interest to
be paid with such prepayment.
4.5 Letters of Credit. If on the stated or any accelerated maturity of
the Credit Obligations the Banks shall be obligated in respect of a Letter of
Credit or a draft accepted under a Letter of Credit, the Borrower will either:
(a) prepay such obligation by depositing with the
Administrative Agent, an amount of cash, or
(b) deliver to the Administrative Agent, a standby letter of
credit (designating such Administrative Agent as beneficiary and issued
by a bank and on terms reasonably acceptable to such Administrative
Agent),
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in each case in an amount equal to the portion of the then Letter of Credit
Exposure issued for the account of the Borrower. Any such cash so deposited and
the cash proceeds of any draw under any standby letter of credit so furnished,
including any interest thereon, shall be returned by such Administrative Agent
to the Borrower only when, and to the extent that, the amount of such cash held
by such Administrative Agent exceeds the Letter of Credit Exposure at a time
when no Default exists; provided, however, that if an Event of Default occurs
and the Credit Obligations become or are declared immediately due and payable,
such Administrative Agent may apply such cash, including any interest thereon,
to the payment of any of the Credit Obligations as provided in the Intercreditor
Agreement.
4.6 Reborrowing Application of Payments, etc.
4.6.1 Reborrowing. The amounts of the Acquisition Loan and the
Working Capital Loan prepaid pursuant to Section 4.2.1, 4.2.3(i) or
(ii), 4.3.2 or 4.4 may be reborrowed from time to time, in the case of
the Acquisition Loan prior to the Acquisition Conversion Date in
accordance with Section 2.1 and in the case of the Working Capital Loan
prior to its Final Maturity Date, in accordance with Section 2.2 and
subject to the limits set forth therein. No portion of the Acquisition
Loan prepaid hereunder after the Acquisition Conversion Date may be
reborrowed.
4.6.2 Order of Application. Each prepayment of the Loan made
pursuant to Section 4.2.1 shall be applied to the Working Capital Loan
or the Acquisition Loan, as appropriate. Each prepayment of the Loan
made pursuant to Section 4.2.3(i) or (ii) shall be applied to the
Acquisition Loan. Any amounts of the Acquisition Loan prepaid after the
Acquisition Conversion Date pursuant to the preceding sentence may not
be reborrowed. Each prepayment of the Acquisition Loan pursuant to
Section 4.2.3(i) or (ii) after the Acquisition Conversion Date shall be
applied to the outstanding principal balance of such Tranche in the
inverse order of the required prepayments provided in Section 4.3.1.
4.6.3 Payment with Accrued Interest, etc. Upon all prepayments
of a Loan, the Borrower shall pay to the Administrative Agent, the
principal amount to be prepaid, together with unpaid interest in
respect thereof accrued to the date of prepayment and any amount owing
with respect thereto under Section 3.2.4. Notice of prepayment having
been given in accordance with Section 4.4, and whether or not notice is
given of prepayments pursuant to Sections 4.2 and 4.3, the amount
specified to be prepaid shall become due and payable on the date
specified for prepayment.
4.6.4 Payments for Banks. All payments of principal hereunder
shall be made to the Administrative Agent, for the account of the Banks
in accordance with the Banks' respective Percentage Interests.
ARTICLE V
SECURITY
5.1 Collateral. The repayment of the Indebtedness shall be secured by
the Collateral as more particularly described and defined in the Security
Documents.
The Borrower hereby acknowledges that all of the Collateral is granted
as security for the repayment of all Indebtedness evidenced by the Notes, the
Private Placement Notes and the notes, if any, evidencing other Parity Debt. If
one or more of such notes are paid in full or satisfied, but any portion of the
Indebtedness evidenced by such note remains unsatisfied, the Collateral Agent
may retain its security interest in all of the Collateral on behalf of the
Secured Parties described therein until the remaining Indebtedness secured
thereby is paid in full, even if the value of the Collateral far exceeds the
amount of such outstanding Indebtedness secured thereby.
5.2 Intercreditor Agreement. The Banks and the Co-Agent hereby
authorize the Administrative Agent to execute and deliver the Intercreditor
Agreement (including any modifications thereof or amendments thereto) to the
Collateral Agent. Borrower confirms that any setoffs shared under the terms of
the Intercreditor Agreement (including without limitation Section 13(c) thereof)
with the Note Purchaser of the Private Placement Notes or the
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holders of any Additional Parity Debt, to the extent of the portions so shared,
will not be deemed to pay down the Loan evidenced by the Notes.
ARTICLE VI
CONDITIONS PRECEDENT AND SUBSEQUENT TO LOANS
6.1 Conditions Precedent to Initial Working Capital Loan and Initial
Acquisition Loan. The obligation of the Banks to make the initial Working
Capital Loan and the initial Acquisition Loan is subject to the satisfaction of
all of the following conditions on or prior to the Closing Date (in addition to
the other terms and conditions set forth herein):
(i) No Default. There shall exist no Event of Default,
Noncompliance Event or Default on the Closing Date.
(ii) Representations and Warranties. The representations,
warranties and covenants set forth in Article VIII shall be true and
correct on and as of the Closing Date, with the same effect as though
made on and as of the Closing Date unless such representation or
warranty relates only to an earlier date.
(iii) Certificates. The Borrower shall have delivered to the
Administrative Agent Certificates, dated as of the Closing Date, and
signed by the President or Vice President and the Secretary of the
General Partner and of Heritage, respectively, certifying (a) to the
matters covered by the conditions specified in subsections (i) and (ii)
of this Section 6.1, (b) that the Borrower and Heritage have performed
and complied with all agreements and conditions required to be
performed or complied with by them prior to or on the Closing Date, (c)
to the name and signature of each officer of the general partner of the
Borrower and of Heritage authorized to execute and deliver the Loan
Documents and any other documents, certificates or writings and to
borrow under this Agreement, and (iv) to such other matters in
connection with this Agreement which the Banks shall determine to be
advisable. The Banks may conclusively rely on such Certificates until
Agent receives notice in writing to the contrary.
(iv) Proceedings. On or before the Closing Date, all
partnership proceedings of the Borrower shall be taken in connection
with the transactions contemplated by the Loan Documents and shall be
satisfactory in form and substance to the Banks and Administrative
Agent's counsel; and the Agents shall have received certified copies,
in form and substance satisfactory to the Banks and Agents' counsel, of
the partnership agreements and certificates of the Borrower and the
Articles or Certificates of Incorporation and By-Laws of the General
Partner and the resolutions of the Board of Directors of the general
partner of the Borrower, as adopted, authorizing the execution and
delivery of the Loan Documents, the borrowings under this Agreement,
and the ratification, confirmation and regranting of the security
interests in the Collateral pursuant to the Security Agreement, to
secure the payment of the Indebtedness.
(v) Notes. The Borrower shall have delivered the Notes payable
to the order of the respective Banks, to the Administrative Agent, in
each case appropriately executed.
(vi) Security Agreement. The Borrower shall have ratified and
confirmed its delivery to the Collateral Agent the Security Agreement,
appropriately executed by the Borrower and Heritage, and dated as of
the Closing Date, together with such financing statements (UCC or
otherwise) (collectively, the "Financing Statements"), and other
documents as shall be necessary and appropriate to continue the
perfection of the Collateral Agent's security interests in the
Collateral covered by said Security Agreement, including, without
limitation, the Security Agreement, and such certificates representing
shares of Capital Stock included in the Collateral and proper stock
powers with respect thereto duly endorsed in blank (collectively, the
"Certificates and Stock Powers").
(vii) Opinions of Borrower's Counsel. The Agents shall have
received from Borrower's counsel, Doerner, Saunders, Xxxxxx & Xxxxxxxx,
a favorable written closing opinion addressed to the Agents and the
Banks with respect to this Agreement, satisfactory in form and
substance to the Administrative Agent's counsel including, without
limitation, an opinion that no consent of the Collateral
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Agent or the Note Purchasers or amendment to the Note Purchase
Agreement is required by the amendments, modifications and transactions
contemplated by this Agreement.
(viii) UCC Releases/Other Information. The Administrative
Agent shall have received a written payoff statement from any other
secured party of record concerning any of the Collateral together with
applicable UCC terminations of record of all such existing security
interest liens pertaining to the Collateral or any part thereof.
(ix) Other Information and Closing Documents. The
Administrative Agent shall have received such other consents,
information, documents, agreements and assurances as shall be
reasonably requested by the Banks, including, without limitation,
appropriate consents and approvals to the issuance of the Notes and the
Commitments and the Intercreditor Agreement, as amended and modified,
shall have been duly executed by all parties thereto and delivered to
the Collateral Agent.
(x) Assignments/Replacement of BankBoston. BankBoston shall
have surrendered its Notes to BOk, as successor Administrative Agent,
and each of Mercantile and Local shall have paid to such Administrative
Agent in immediately available funds an amount equal to their
respective Percentage Interest in the outstanding principal balance of
such BankBoston Notes (for Mercantile, maximum additional amounts of
$2,000,000 on the BankBoston Working Capital Note and $3,000,000 on the
BankBoston Acquisition Note and for Local, maximum additional amounts
of $6,000,000 on the BankBoston Working Capital Note and $9,000,000 on
the BankBoston Acquisition Note) of the Loan assigned hereunder thereto
by BankBoston, for concurrent remittance by the Administrative Agent to
BankBoston in exchange for its resignation as Administrative Agent and
its return of the Notes held by BankBoston to BOk, as the successor
Administrative Agent.
6.2 Conditions Precedent to All Loans. The Banks shall not be obligated
to make any additional Loan advance(s) or to issue any Letters of Credit after
the Closing Date (i) if at such time any Event of Default or any Noncompliance
Event shall have occurred or any Default shall have occurred and be continuing;
or (ii) if any of the representations, warranties and covenants contained in
Article VIII of this Agreement shall be false or untrue in any material respect
on the date of such advance or issue, as if made on such date (unless such
representation or warranty relates only to an earlier date). Each request by the
Borrower for an additional Working Capital Loan or Acquisition Loan shall
constitute a representation by the Borrower that there is not at the time of
such request an Event of Default, a Noncompliance Event or a Default, and that
all representations, warranties and covenants in Article VIII of this Agreement
are true and correct on and as of the date of each such applicable Loan request
or request for a Letter of Credit.
ARTICLE VII
COVENANTS
The Borrower hereby covenants and agrees with the Banks that, comply
with the terms and provisions of this Article VII.
7A. Affirmative Covenants.
7A.1 Financial Statements. The Borrower will maintain, and will cause
each of its Subsidiaries to maintain, a system of accounting established and
administered in accordance with GAAP. The Borrower covenants that it will
deliver to each Bank:
(i) as soon as practicable and in any event within 50 days
after the end of each quarterly period in each fiscal year,
consolidated statements of income, partners' capital and cash flows of
the Borrower and its Subsidiaries for such quarterly period and (in the
case of the second, third and fourth quarterly periods) for the period
from the beginning of the current fiscal year to the end of such
quarterly period, and consolidated balance sheets of the Borrower and
its Subsidiaries as at the end of such quarterly period, setting forth
in each case with respect to financial statements delivered as of any
date and for any period after the Closing Date, in comparative form
figures for the corresponding period in the preceding
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fiscal year, all in reasonable detail and satisfactory in form to the
Required Banks and certified by an authorized financial officer of the
Borrower as presenting fairly, in all material respects, the
information contained therein (except for the absence of footnotes and
subject to changes resulting from normal year-end adjustments), in
accordance with GAAP; provided, however, that at any time when the
Master Partnership shall be subject to the reporting requirements of
Section 13 or 15(d) of the Exchange Act delivery within the time period
specified above of copies of the Quarterly Report on Form 10-Q of the
Master Partnership for such quarterly period filed with the Commission
shall be deemed to satisfy the requirements of this clause (i) if (x)
the Consolidated Net Income of the Borrower and its Subsidiaries
accounts for at least 95% of the net income of the Master Partnership
for such quarterly period, and (y) all such statements required to be
delivered pursuant to this clause (i) with respect to the Borrower and
its Subsidiaries are either included or are included in such Form 10-Q
or delivered separately by the Borrower together with such Form 10-Q;
(ii) as soon as practicable and in any event within 95 days
after the end of each fiscal year, consolidated and consolidating
statements of income and cash flows and a consolidated and
consolidating statement of partners' capital (or stockholders' equity,
as applicable) of the Borrower and its Subsidiaries for such year, and
consolidated and consolidating balance sheets of the Borrower and its
Subsidiaries, as at the end of such year, setting forth in each case
with respect to financial statements delivered as of any date and for
any period after the Closing Date, in comparative form corresponding
consolidated and, where applicable, consolidating figures from the
preceding annual audit, all in reasonable detail and, as to the
consolidated statements, reported on by Xxxxxx Xxxxxxxx LLP, or other
independent public accountants of recognized national standing selected
by the Borrower whose report shall be without limitation as to the
scope of the audit and, as to the consolidating statements, certified
by an authorized financial officer of the Borrower as presenting
fairly, in all material respects, the information contained therein, in
accordance with GAAP (except, in the case of such consolidating
financial statements, for the absence of footnotes); provided, however,
that at any time when the Master Partnership shall be subject to the
reporting requirements of Section 13 or 15(d) of the Exchange Act
delivery within the time period specified above of copies of the Annual
Report on Form 10-K of the Master Partnership for such fiscal year
prepared in compliance with the requirements therefor and filed with
the Commission shall be deemed to satisfy the requirements of this
clause (ii) if (x) the Consolidated Net Income of the Borrower and its
Subsidiaries accounts for at least 95% of the net income of the Master
Partnership for such fiscal year, and (y) all such statements required
to be delivered pursuant to this clause (ii) with respect to the
Borrower and its Subsidiaries are either included in such Form 10-K and
such reports or delivered separately by the Borrower together with such
Form 10-K and such reports;
(iii) promptly upon receipt thereof by the Borrower, copies of
all reports submitted to the Borrower by independent public accountants
in connection with each special, annual or interim audit of the books
of the Borrower or any Subsidiary thereof made by such accountants,
including without limitation the comment letter submitted by each such
accountant to management in connection with their annual audit;
(iv) promptly upon transmission thereof, copies of (a) all
financial statements, proxy statements, notices and reports as the
Borrower or the Master Partnership shall send or make available to the
public Unitholders of the Master Partnership, (b) all registration
statements (without exhibits), all prospectuses and all reports which
the Borrower or the Master Partnership files with the Commission (or
any governmental body or agency succeeding to the functions of the
Commission), (c) all press releases and other similar written
statements made available by the Borrower or the Master Partnership to
the public concerning material developments in the business of the
Borrower or the Master Partnership, as the case may be, and (d) all
reports, notices and other similar written statements sent or made
available by the Borrower or the Master Partnership to any holder of
its Indebtedness pursuant to the terms of any agreement, indenture or
other instrument evidencing such Indebtedness, including without
limitation the Credit Agreement, except to the extent the same
substantive information is already being provided pursuant to this
Section 7A.1;
(v) as soon as reasonably practicable, and in any event within
5 Business Days after a Responsible Officer obtains knowledge that any
Default or Event of Default has occurred, a written
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statement of such Responsible Officer setting forth details of such
Default or Event of Default and the action which the Borrower has
taken, is taking and proposes to take with respect thereto;
(vi) as soon as reasonably practicable, and in any event
within 5 Business Days after a Responsible Officer obtains knowledge of
(a) the occurrence of an adverse development with respect to any
litigation or proceeding involving the Borrower or any of its
Subsidiaries which in the reasonable judgment of the Borrower could
reasonably be expected to have a Material Adverse Effect or (b) the
commencement of any litigation or proceeding involving the Borrower or
any of its Subsidiaries which in the reasonable judgment of the
Borrower could reasonably be expected to have a Material Adverse
Effect, a written notice of such Responsible Officer describing in
reasonable detail such commencement of, or adverse development with
respect to, such litigation or proceeding;
(vii) as soon as possible after, and in any event within 10
Business Days after any Responsible Officer of the Borrower or any
ERISA Affiliate knows or has reason to know that, any ERISA Event has
occurred or is expected to occur that, alone or together with any other
ERISA Events that have occurred, in the opinion of the principal
financial officer of the Borrower could reasonably be expected to
result in liability of the Borrower in an aggregate amount exceeding
$2,000,000, a statement setting forth a detailed description of such
ERISA Event and the action, if any, that the Borrower or any ERISA
Affiliate has taken, is taking or proposes to take or cause to be taken
with respect thereto (together with a copy of any notice, report or
other written communication filed with or given to or received from the
PBGC, the Internal Revenue Service or the Department of Labor with
respect to such event or condition);
(viii) as soon as reasonably practicable, and in any event
within five Business Days after a Responsible Officer obtains knowledge
of a violation or alleged violation of any Environmental Law or the
presence or release of any Hazardous Substance within, on, from,
relating to or affecting any property, which in the reasonable judgment
of the Borrower could reasonably be expected to have a Material Adverse
Effect, notice thereof, and upon request, copies of relevant
documentation;
(ix) together with each delivery of financial information
pursuant to clause (i) or clause (ii) of this Section 7A.1, a statement
setting forth, together with computations in reasonable detail, the
amount of Available Cash as of the date of the balance sheet contained
therein and the amounts of all Net Proceeds, Excess Sale Proceeds,
Unutilized Taking Proceeds and Unused Proceeds Reserves held by the
Borrower at the end of the applicable quarterly period or fiscal year,
as the case may be;
(x) as soon as reasonably practicable, and in any event within
5 Business Days after a Responsible Officer obtains knowledge that the
holder of any Note has given any notice to the Borrower or any
Subsidiary thereof or taken any other action with respect to a claimed
Default or Event of Default under this Agreement or any other Loan
Documents, or that any Person has given any notice to the Borrower or
any such Subsidiary or taken any other action with respect to a claimed
default or event or condition of the type referred to in [Section
9.1A(iii), Event of Default] a written statement of such Responsible
Officer describing such notice or other action in reasonable detail and
the action which the Borrower has taken, is taking and proposes to take
with respect thereto;
(xi) prior to the Closing Date and within 45 days after the
end of each calendar year ending thereafter, commencing with the year
ending December 31, 1999, a report prepared by the Borrower or its
broker or agent (a) setting forth the insurance maintained pursuant to
Section 7A.8, and including, without limitation, the amounts thereof,
the names of the insurers and the property, hazards and risks covered
thereby, and certifying that all premiums with respect to the policies
described in such report then due thereon have been paid and that the
same are in full force and effect, (b) setting forth all self-insurance
maintained by the Borrower pursuant to Section 7A.8 and (c) certifying
that such insurance or self insurance complies with the requirements of
such Section 7A.8; and
(xii) with reasonable promptness, such other information and
data (financial or other) as from time to time may be reasonably
requested by any Bank.
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Together with each delivery of financial statements required by clauses (i) and
(ii) above, the Borrower will deliver to each holder of Notes an Officers'
Certificate (I) stating that the signers have reviewed the terms of this
Agreement and the other Loan Documents, and have made, or caused to be made
under their supervision, a review in reasonable detail of the transactions and
condition of the Borrower and its Subsidiaries during the accounting period
covered by such financial statements, and that no Default or Event of Default
has occurred and is continuing, or, if any such Default or Event of Default then
exists, specifying the nature and approximate period of existence thereof and
what action the Borrower has taken or is taking or proposes to take with respect
thereto, (II) specifying the amount available at the end of such accounting
period for Restricted Payments in compliance with Section 7B.6 and showing in
reasonable detail all calculations required in arriving at such amount, (III)
demonstrating (with computations in reasonable detail) compliance at the end of
such accounting period by the Borrower and its Subsidiaries with the provisions
of Sections 4.6, 7B.1, 7B.2, 7B.3, 7B.4, 7B.5(v), 7B.7(i)(b), 7B.7(i)(c),
7B.7(iii) and 7B.12, and (IV) if not specified in the related financial
statements being delivered pursuant to clauses (i) and (ii) above, specifying
the aggregate amount of interest paid or accrued by, and aggregate rental
expenses of, the Borrower and its Subsidiaries, and the aggregate amount of
depreciation, depletion and amortization charged on the books of the Borrower
and its Subsidiaries, during the fiscal period covered by such financial
statements.
Together with each delivery of financial statements required by clause
(ii) above, the Borrower will deliver a certificate of such accountants stating
that they have reviewed the terms of this Agreement and the other Loan Documents
and that in making the audit necessary for their report on such financial
statements, they have obtained no knowledge of any Event of Default or Default,
or, if they have obtained knowledge of any Event of Default or Default,
specifying the nature and period of existence thereof. Such accountants,
however, shall not be liable to anyone by reason of their failure to obtain
knowledge of any Event of Default or Default which would not be disclosed in the
course of an audit conducted in accordance with generally accepted auditing
standards.
7A.2 Inspection of Property. The Borrower will permit any Person
designated in writing by any holder of the Notes which is an institutional
investor, at the Borrower's expense during the continuance of a Default or Event
of Default and otherwise at such holder's expense, to visit and inspect any of
the properties of the Borrower and its Subsidiaries, to examine the corporate
books and financial records of the Borrower and its Subsidiaries and make copies
thereof or extracts therefrom and to discuss the affairs, finances and accounts
of any of such partnerships or corporations with the principal officers of the
Borrower and its independent public accountants, all at such reasonable times
and as often as such holder may reasonably request. The Borrower hereby
authorizes, and agrees to cause each of its Subsidiaries to authorize, its and
their independent public accountants to discuss with such Person the affairs,
finances and accounts of the Borrower and its Subsidiaries in accordance with
this Section 7A.2.
7A.3 Covenant to Secure Notes Equally. If the Borrower or any of its
Subsidiaries shall create or assume any Lien upon any of its property or assets,
whether now owned or hereafter acquired, other than Liens permitted by the
provisions of Sections 7B.3 and 7B.4 (unless prior written consent to the
creation or assumption thereof shall have been obtained pursuant to Section
10.6), the Borrower will make or cause to be made effective provision whereby
the Notes will be contemporaneously secured by such Lien equally and ratably
with any and all other Indebtedness thereby secured so long as any such other
Indebtedness shall be so secured (including, without limitation, the provision
of any financial accommodations extended to the holders of such other
Indebtedness in connection with the release of such Lien and/or the sale of any
property subject thereto), it being understood that the provision of such equal
and ratable security shall not constitute a cure or waiver of any related Event
of Default.
7A.4 Partnership or Corporate Existence, etc.; Compliance with Laws.
(i) Except as otherwise expressly permitted in accordance with Section
7B.7 or 7B.11, (a) the Borrower will at all times preserve and keep in full
force and effect its partnership existence and its status as a partnership not
taxable as a corporation for U.S. federal income tax purposes, (b) the Borrower
will cause each of its Subsidiaries to keep in full force and effect its
partnership or corporate existence, as the case may be, and (c) the Borrower
will, and will cause each of its Subsidiaries to, at all times preserve and keep
in full force and effect all of its material rights and franchises; provided,
however, that the partnership or corporate existence of any Subsidiary, and any
right or franchise of the Borrower or any Subsidiary, may be terminated
notwithstanding this Section 7A.4 if such termination (x) is in the best
interest of the Borrower and the Subsidiaries, (y) is not disadvantageous to the
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holders of the Notes in any material respect and (z) could not reasonably be
expected to have a Material Adverse Effect.
(ii) The Borrower will, and will cause each of its Subsidiaries to, at
all times comply with all laws, regulations and statutes (including without
limitation any zoning or building ordinances or code or Environmental Laws)
applicable to it except for any failure to so comply which, individually or in
the aggregate, could not reasonably be expected to have a Material Adverse
Effect.
(iii) The Borrower will notify the Bank a reasonable time prior to the
adoption of any amendment to the Partnership Agreement, the Note Purchase or any
Operative Agreement and will include in that notice a reasonably detailed
description of such amendment and the intended effects thereof.
7A.5 Payment of Taxes and Claims. The Borrower will, and will cause
each of its Subsidiaries to, pay all taxes, assessments and other governmental
charges imposed upon it or any of its Subsidiaries, or any of its or its
Subsidiaries' properties or assets or in respect of any of its or any of its
Subsidiaries' franchises, business, income or profits when the same become due
and payable, and all claims (including without limitation claims for labor,
services, materials and supplies) for sums which have become due and payable and
which by law have or might become a Lien upon any of its or any of its
Subsidiaries' properties or assets; provided that no such tax, assessment,
charge or claim need be paid if it is being contested in good faith by
appropriate proceedings promptly initiated and diligently conducted and if such
reserves or other appropriate provision, if any, as shall be required by GAAP
shall have been made therefor and be adequate in the good faith judgment of the
Board of Directors of the General Partner.
7A.6 Compliance with ERISA. The Borrower will, and will cause its
Subsidiaries to, comply in all material respects with the provisions of ERISA
and the Code applicable to the Borrower and its Subsidiaries and their
respective employee benefit programs.
7A.7 Maintenance and Sufficiency of Properties.
(i) The Borrower will maintain or cause to be maintained in good
repair, working order and condition, ordinary wear and tear excepted, all
properties used in the business of the Borrower and its Subsidiaries and from
time to time will make or cause to be made all appropriate repairs, renewals and
replacements thereof, all to the extent necessary to avoid a Material Adverse
Effect.
(ii) The Borrower will maintain and will cause to be maintained as
employees of the Borrower and its Subsidiaries such number of individuals,
having appropriate skills, as may be necessary from time to time to sustain
continuous operation of the Business at the time. Except as described on
Schedule 8.8 the Borrower will continue and will cause its Subsidiaries to
continue to own or have valid rights to use all of the Assets constituting
personal or intellectual property (including without limitation computer
equipment, computer software and other intellectual property) reasonably
necessary for the operation of the Business, in each case subject to no Liens
except such as are permitted by Section 7B.3.
7A.8 Insurance.
(i) The Borrower will, and will cause its Subsidiaries to, at its or
their expense, at all times maintain, or cause to be maintained, with
financially sound and reputable insurers, insurance with respect to their
properties and business with coverages comparable to those generally carried by
companies of similar size that conduct the same or similar business and have
similar properties in the same general areas in which the Borrower conducts its
business; provided, however, that the Borrower may maintain a system of
self-insurance in an amount not exceeding an amount as is customary for
companies with established reputations engaged in the same or similar business
and owning and operating similar properties.
(ii) The Borrower will, and will cause each of its Subsidiaries to, pay
as and when the same become due and payable the premiums for all insurance
policies that the Borrower and its Subsidiaries are required to maintain
hereunder.
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7A.9 Environmental Laws. The Borrower will, and will cause each of its
Subsidiaries to:
(i) comply with all applicable Environmental Laws and any permit,
license, or approval required under any Environmental Law, except for failures
to so comply which could not reasonably be expected to have a Material Adverse
Effect;
(ii) store, use, release, or dispose of any Hazardous Substance at any
property owned or leased by the Borrower or any of its Subsidiaries in a manner
which could not reasonably be expected to have a Material Adverse Effect;
(iii) avoid committing any act or omission which would cause any Lien
to be asserted against any property owned by the Borrower or any of its
Subsidiaries pursuant to any Environmental Law, except where such Lien could not
reasonably be expected to have a Material Adverse Effect;
(iv) use, handle or store any propane in compliance, in all material
respects, with all applicable laws.
7A.10 Operative Agreements. The Borrower will perform and comply with
all of its obligations under each of the Operative Agreements to which it is a
party, will enforce each such Operative Agreement against each other party
thereto and will not accept the termination of any such Operative Agreement or
any amendment or supplement thereof or modification or waiver thereunder, unless
any such failure to perform, comply or enforce or any such acceptance could not,
individually or in the aggregate, reasonably be expected to have a Material
Adverse Effect.
7A.11 After-Acquired Property. From and after the date of the Closing,
the Borrower will, and will cause each of its Subsidiaries to, execute and
deliver such amendments to the Security Agreement, execute and deliver such
instruments and agreements (including, without limitation, such Certificates and
Stock Powers) and execute and cause to be duly recorded, published, registered
or filed in the appropriate jurisdictions such Financing Statements, as shall be
necessary to grant to the Collateral Agent a valid, perfected, first priority
security interest, subject to Liens permitted by the Security Agreement in any
asset acquired by the Borrower or any Subsidiary of the Borrower (including,
without limitation, the Capital Stock of any Subsidiary) after the Closing, to
the extent such asset would have been included in the Collateral granted at the
Closing had the Borrower or one of its Subsidiaries owned such asset as of the
Closing. The Borrower will pay or cause to be paid all taxes, fees and other
governmental charges in connection with the execution, delivery, recording,
publishing, registration and filing of such documents and instruments in such
places.
7A.12 Further Assurances. At any time and from time to time promptly,
the Borrower shall, at its expense, execute and deliver to each Bank and the
Collateral Agent such instruments and documents, and take such further action,
as the holders of the Notes may from time to time reasonably request, in order
to further carry out the intent and purpose of this Agreement and the other Loan
Documents and to establish, perfect, preserve and protect the rights, interests
and remedies created, or intended to be created, in favor of the Banks, and
including, without limitation, the execution and delivery of Certificates and
the delivery of Stock Powers and the execution, delivery, recordation and filing
of Financing Statements and continuation statements under the Uniform Commercial
Code of any applicable jurisdiction, and the delivery of satisfactory opinions
of counsel.
7A.13 Books and Accounts. The Borrower will, and will cause each of its
Subsidiaries to, maintain proper books of record and account in which full, true
and proper entries shall be made of its transactions and set aside on its books
from its earnings for each fiscal year all such proper reserves as in each case
shall be required in accordance with GAAP.
7A.14 Available Cash Reserves. The Borrower will maintain an amount of
cash reserves that is necessary or appropriate in the reasonable discretion of
the General Partner to (i) provide for the proper conduct of the business of the
Borrower and its Subsidiaries (including reserves for future capital
expenditures) subsequent to such quarter, (ii) comply with applicable law or any
loan agreement, security agreement, mortgage, debt instrument or other agreement
or obligation to which the Borrower or any Subsidiary is a party or by which it
is bound or its assets are subject (including the Loan Documents) and (iii)
provide funds for distributions to partners of the Master Partnership and the
General Partner in respect of any one or more of the next four quarters;
provided that the
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General Partner need not establish cash reserves pursuant to clause (iii) if the
effect of such reserves would be that the Master Partnership is unable to
distribute the Minimum Quarterly Distribution (as defined in the Agreement of
Limited Partnership of the Master Partnership) on all Common Units with respect
to such quarter; and provided, further, that disbursements made by the Borrower
or a Subsidiary of the Borrower or cash reserves established, increased or
reduced after the end of such quarter but on or before the date of determination
of Available Cash with respect to such quarter shall be deemed to have been
made, established, increased or reduced for purposes of determining Available
Cash, within such quarter if the General Partner so determines. In addition,
without limiting the foregoing, Available Cash for any fiscal quarter shall
reflect cash reserves equal to (x) 50% of the interest projected to be paid on
the Private Placement Notes in the next succeeding fiscal quarter, plus (y)
beginning with a date three fiscal quarters before a scheduled principal payment
date on the Private Placement Notes, 25% of the aggregate principal amount
thereof due on any such payment date in the third succeeding fiscal quarter, 50%
of the aggregate principal amount due on any such payment date in the second
succeeding fiscal quarter and 75% of the aggregate principal amount due on any
quarterly payment date in the next succeeding fiscal quarter, plus (z) the
Unused Proceeds Reserve as of the date of determination; provided that the
foregoing reserves for amounts to be paid on the Private Placement Notes shall
be reduced by the aggregate amount of advances available to the Borrower from
responsible financial institutions under binding, irrevocable (a) credit or
financing commitments (which are subject to no conditions which the Borrower is
unable to meet) and (b) letters of credit (which are subject to no conditions
which the Borrower is unable to meet), in each case to be used to refinance such
amounts to the extent such amounts could be borrowed and remain outstanding
under Sections 7B.2(ii) and 7B.2(iii).
7A.15 Parity Debt.
(i) The Borrower shall ensure that the lenders from time to time in
respect of any outstanding Parity Debt shall, in the documents governing the
terms of such Indebtedness, (a) recognize the existence and validity of the
obligations represented by the Notes and (b) agree to refrain from making or
asserting any claim that the Loan Documents or the obligations represented by
the Notes are invalid or not enforceable in accordance with its and their terms
as a result of the circumstances surrounding the incurrence of such obligations.
(ii) Each Bank and each other Person that becomes a Bank, as evidenced
by its acceptance of its Notes, (a) acknowledges the existence and validity of
the obligations of the Borrower and Heritage under the Note Purchase Agreement
(and any replacement, extension, renewal, refunding or refinancing thereof
permitted by Section 7B.2, as the case may be) and (b) agrees to refrain from
making or asserting any claim that such obligations or the instruments governing
the terms thereof are invalid or not enforceable in accordance with its and
their terms as a result of the circumstances surrounding the incurrence of such
obligations.
7A.16 Year 2000 Compliant. The Borrower and its Subsidiaries shall be
"Year 2000 Compliant" on or before August 31, 1999 and at all times thereafter.
As used herein "Year 2000 Compliant" shall mean, with regard to any entity, that
all software, embedded microchips, and other processing capabilities utilized
by, and material to the business operations or financial condition of such
entity, are able to interpret and manipulate data involving all calendar dates
correctly and without causing any abnormal ending scenario, including dates in
and after the Year 2000.
7B. Negative Covenants.
7B.1 Financial Ratios.
(i) Ratio of Consolidated EBITDA to Consolidated Interest Expense. The
Borrower will not permit the ratio as of the last day of any fiscal quarter of
the Borrower of Consolidated EBITDA to Consolidated Interest Expense to be less
than 2.25 to 1;
(ii) Ratio of Consolidated Funded Indebtedness to Consolidated EBITDA.
The Borrower will not permit the ratio as of the last day of any fiscal quarter
of Consolidated Funded Indebtedness to Consolidated EBITDA to exceed (a) 5.0 to
1 on any date on or prior to August 31, 2000, or (b) 4.75 to 1 on any date after
August 31, 2000;
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Notwithstanding any of the provisions of this Agreement the Borrower
will not, and will not permit any Subsidiary to, enter into any transaction
pursuant to Section 7B.2, clauses (vii), (viii) and (xiv)(b) of Section 7B.3,
Section 7B.6, of clauses (i)(b), (i)(c), (ii)(b) and (iii) of Section 7B.7, (x)
if after giving effect to any such transaction a Noncompliance Event, Default or
Event of Default exists or (y) if the consummation of any such transaction would
result in a violation of any clause of this Section 7B.1 or a Noncompliance
Event, calculated for such purpose as of the date on which such transaction were
to be consummated both immediately before and after giving effect to the
consummation thereof; provided, however, that in the case of transactions
pursuant to Section 7B.7, the calculation shall be made on a pro forma basis in
accordance with GAAP after giving effect to any such transaction, with the ratio
recomputed as at the last day of the most recently ended fiscal quarter of the
Borrower as if such transaction had occurred on the first day of the relevant
four quarter period.
7B.2 Indebtedness. The Borrower will not, and will not permit any of
its Subsidiaries to, create, incur, assume, or otherwise become directly or
indirectly liable with respect to, any Indebtedness, except (subject to the
provisions of Section 7B.4):
(i) the Borrower may become and remain liable with respect to
Indebtedness evidenced by the Notes and Indebtedness incurred in connection with
any extension, renewal, refunding or refinancing of Indebtedness evidenced by
the Private Placement Notes, provided that the principal amount of such
Indebtedness shall not exceed the principal amount of the Indebtedness evidenced
by the Private Placement Notes, together with any accrued interest and Yield
Maintenance Amount with respect thereto, being extended, renewed, refunded or
refinanced and (y) such Indebtedness may not have an average life to maturity
shorter than the remaining average life to maturity of the Indebtedness being
extended, renewed, refunded or refinanced;
(ii) the Borrower may become and remain liable with respect to
Indebtedness incurred under the Working Capital Facility and any Indebtedness
incurred for such purpose which replaces, extends, renews, refunds or refinances
all of such Indebtedness (in the case of a replacement, refunding or
refinancing, so long as the Acquisition Facility also is replaced, refunded or
refinanced in whole; provided that the aggregate principal amount of
Indebtedness permitted under this clause (ii) shall not at any time exceed an
amount equal to (x) $20,000,000 less (y) the amount of Indebtedness, if any,
outstanding under the revolving working capital facility permitted by clause (v)
of this Section 7B.2;
(iii) the Borrower may become and remain liable with respect to
Indebtedness incurred by the Borrower under the Acquisition Facility and any
Indebtedness incurred for such purpose which replaces, extends, renews, refunds
or refinances all of such Indebtedness (in the case of a replacement refunding
or refinancing, so long as the Working Capital Facility also is replaced,
refunded or refinanced in whole); and up to $3,000,000 of Indebtedness owing
from time to time to the Seller(s) in Asset Acquisitions provided that the
aggregate principal amount of Indebtedness permitted under this clause (iii)
shall not at any time exceed the lesser of $30,000,000 or the sum of the
outstanding balance of such Seller(s) Asset Acquisitions debt referenced above
(in no event in excess of $3,000,000) plus the aggregate Acquisition Loan
Commitments described in Section 10.1, as amended from time to time;
(iv) any Subsidiary of the Borrower may become and remain liable with
respect to Indebtedness of such Subsidiary owing to the Borrower or to a
Wholly-Owned Subsidiary of the Borrower;
(v) Heritage Service may remain liable with respect to Indebtedness
incurred under the Heritage Service Credit Agreement and any Indebtedness
incurred for any permitted purpose which replaces, extends, renews, refunds or
refinances such Indebtedness evidenced by the Service Revolver Notes, in whole
or in part; provided that the aggregate principal amount of Indebtedness
permitted under this clause (v) shall not at any time exceed $1,000,000;
(vi) the Borrower and any of its Subsidiaries may become and remain
liable with respect to Indebtedness relating to any business, property or assets
acquired by or contributed to the Borrower or such Subsidiary or which is
secured by a loan on any property or assets acquired by or contributed to the
Borrower or such Subsidiary to the extent such Indebtedness existed at the time
such business, property or assets were so acquired or contributed, and if such
Indebtedness is secured by such property or assets, such security interest does
not extend to or cover any other property of the Borrower or any of its
Subsidiaries; provided that (a) immediately
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after giving effect to such acquisition or contribution, the Borrower could
incur at least $1.00 of additional Indebtedness pursuant to clause (xiv) of this
Section 7B.2 and (b) such Indebtedness was not incurred in anticipation of such
acquisition or contribution;
(vii) the Company and any of its Subsidiaries may become and remain
liable with respect to Indebtedness arising from the honoring by a bank or other
financial institution of a check, draft or similar instrument drawn against
insufficient funds in the ordinary course of business, provided that such
Indebtedness is extinguished within 2 Business Days of its incurrence;
(viii) M-P Energy Partnership may become and remain liable with respect
to Indebtedness in an aggregate principal amount not to exceed $3,000,000, and
the Borrower may become and remain liable with respect to Guarantees of such
Indebtedness of M-P Energy Partnership and of Indebtedness of Bi State Propane,
provided that the aggregate amount of all Guarantees permitted by this clause
(viii) shall not exceed $5,000,000;
(ix) [INTENTIONALLY LEFT BLANK]
(x) any Person that after the Closing Date becomes a Subsidiary of the
Borrower may become and remain liable with respect to any Indebtedness to the
extent such Indebtedness existed at the time such Person became a Subsidiary;
provided that (a) immediately after giving effect to such Person becoming a
Subsidiary of the Borrower, the Borrower could incur at least $1.00 of
additional Indebtedness in compliance with clause (xiv) of this Section 7B.2 and
(b) such Indebtedness was not incurred in anticipation of such Person becoming a
Subsidiary of the Borrower;
(xi) the Borrower and any of its Subsidiaries may become and remain
liable with respect to Indebtedness owed to any person providing workers'
compensation, health, disability or other employee benefits or property,
casualty or liability insurance to the Borrower or any of its Subsidiaries,
pursuant to reimbursement or indemnification obligations to such person;
(xii) the Borrower and any of its Subsidiaries may become and remain
liable with respect to Indebtedness in respect of performance bonds, bid bonds,
appeal bonds, surety bonds and similar obligations, in each case provided in the
ordinary course of business, including those incurred to secure health, safety
and environmental obligations in the ordinary course of business, and any
extension, renewal or refinancing thereof to the extent not provided to secure
the repayment of other Indebtedness and to the extent that the amount of
refinancing Indebtedness is not greater than the amount of Indebtedness being
refinanced;
(xiii) the Borrower may become and remain liable with respect to
Indebtedness incurred in respect of Capitalized Lease Obligations and
Non-Compete Obligations; provided, that the Lien in respect thereof is permitted
by clause (viii) of Section 7B.3; and
(xiv) the Borrower and its Subsidiaries may become and remain liable
with respect to Indebtedness not exceeding $100,000,000 in aggregate principal
amount at any time outstanding, in addition to that otherwise permitted by the
other clauses of this Section 7B.2, if (1) the stated maturity of such
Indebtedness (including all scheduled amortizations of principal thereof) shall
not be earlier than the last Final Maturity Date in effect on the date of
incurrence of such Indebtedness and (2) on the date the Borrower or any of its
Subsidiaries becomes liable with respect to any such additional Indebtedness and
immediately after giving effect thereto and to the substantially concurrent
repayment of any other Indebtedness (a) the ratio of Consolidated EBITDA to
Consolidated Debt Service is equal to or greater than 2.50 to 1.0 and (b) the
ratio of Consolidated EBITDA to Consolidated Pro Forma Maximum Debt Service is
equal to or greater than 1.25 to 1.0 and (c) no Default, Event of Default or
Noncompliance Event shall exist.
7B.3 Liens. The Borrower will not, and will not permit any of its
Subsidiaries to, create, assume, incur or suffer to exist any Lien upon or with
respect to any of its properties or assets, whether now owned or hereafter
acquired, or any income or profits therefrom (whether or not provision is made
for the equal and ratable securing of the Notes in accordance with the
provisions of Section 7A.3), except:
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(i) Liens existing on the Initial Closing Date hereof on the property
and assets of the Borrower or any of its Subsidiaries as described in Schedule
7B.3;
(ii) Liens for taxes, assessments or other governmental charges the
payment of which is not yet due and payable or the validity of which is being
contested in good faith in compliance with Section 7A.5;
(iii) attachment or judgment Liens not giving rise to an Event of
Default and with respect to which the underlying action has been appealed or is
being contested in good faith in compliance with Section 7A.5;
(iv) Liens of lessors, landlords, carriers, vendors, mechanics,
materialmen, warehousemen, repairmen and other like Liens incurred in the
ordinary course of business the payment of which is not yet due or which is
being contested in good faith in compliance with Section 7A.5, in each case not
incurred or made in connection with the borrowing of money, the obtaining of
advances or credit or the payment of the deferred purchase price of property,
provided that such Liens do not materially interfere with the conduct of the
business of the Borrower and its Subsidiaries taken as a whole;
(v) Liens (other than any Lien imposed by ERISA) incurred and pledges
and deposits made in the ordinary course of business (a) in connection with
workers' compensation, unemployment insurance, old age pensions, retiree health
benefits and other types of social security, or (b) to secure (or to obtain
letters of credit that do not constitute Indebtedness and that secure) the
performance of tenders, statutory obligations, surety and appeal bonds, bids,
leases, performance bonds, contracts and other similar obligations, in each case
not incurred or made in connection with the borrowing of money or the obtaining
of advances or credit provided that such Liens do not materially interfere with
the conduct of the business of the Borrower and its Subsidiaries taken as a
whole;
(vi) zoning restrictions, easements, licenses, reservations,
provisions, covenants, conditions, waivers, restrictions on the use of property
or irregularities of title (and with respect to leasehold interests, mortgages,
obligations, liens and other encumbrances incurred, created, assumed or
permitted to exist and arising by, through or under a landlord or owner of the
leased property, with or without consent of the lessee) which do not in the
aggregate materially detract from the value of its property or assets or
materially impair the use thereof in the operation of its business;
(vii) Liens existing on any property of a Person at the time such
Person becomes a Subsidiary of the Borrower or existing at the time of
acquisition upon any property acquired by the Borrower or any of its
Subsidiaries at the time such property is so acquired, through purchase, merger
or consolidation or otherwise (whether or not the Indebtedness secured thereby
shall have been assumed); provided, however, that in the case of any such Lien
(1) such Lien shall at all times be confined solely to any such property and, if
required by the terms of the instrument creating such Lien, other property which
is an improvement to such acquired property, (2) such Lien was not created in
anticipation of such transaction, and (3) the Indebtedness secured by such Lien
shall be permitted under Section 7B.2;
(viii) Liens created to secure all or any part of the purchase price,
or to secure Indebtedness (other than Parity Debt) incurred or assumed to pay
all or any part of the purchase price or cost of construction, of property
acquired or constructed by the Borrower or any of its Subsidiaries after the
Closing Date or to secure obligations incurred in consideration of non-compete
agreements ("Non-Compete Obligations") entered into in connection with any such
acquisition, including an acquisition complying with clause (b)(y) of Section
7B.9; provided that (a) any such Lien shall be confined solely to the item or
items of such property (or improvement thereon) so acquired or constructed and,
if required by the terms of the instrument creating such Lien, other property
(or improvement thereon) which is an improvement to such acquired or constructed
property (and, in the case of any Lien securing Non-Compete Obligations, shall
also be limited to (x) such items of property as acquired which are not of the
character included in the definition of Collateral and (y) such additional items
of the property so acquired, having a total fair market value (as determined in
good faith by the Board of Directors of the General Partner) for the sum of (x)
and (y) that is not more than the amount of the Non-Compete Obligations so
secured), (b) such item or items of property so acquired and subject to such
Lien are not required to become part of the Collateral under the terms of the
Security Agreement, (c) any such Lien shall be created contemporaneously with,
or within 180 days after, the acquisition or construction of such property, and
(d) such Lien does not exceed an amount equal to 85% of the fair market value
(100% in the case of Capitalized Lease Obligations and 35% in the case of
Non-Compete Obligations)
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of such property (as determined in good faith by the Board of Directors of the
General Partner) at the time of acquisition thereof and (e) after giving effect
to such Lien no Noncompliance Event, Default or Event of Default shall exist;
(ix) Liens on property or assets of any Subsidiary of the Borrower
securing Indebtedness of such Subsidiary owing to the Borrower or a Wholly-Owned
Subsidiary;
(x) leases or subleases of equipment to customers which do not
materially interfere with the conduct of the business of the Borrower and its
Subsidiaries taken as a whole;
(xi) easements, exceptions or reservations in any property of the
Borrower or any Subsidiary granted or reserved for the purpose of pipelines,
roads, the removal of oil, gas, coal or other minerals, and other like purposes,
or for the joint or common use of real property, facilities and equipment, which
are incidental to, and do not materially interfere with, the ordinary conduct of
the business of the Borrower or any of its Subsidiaries;
(xii) Liens (other than Liens securing Indebtedness) on the property or
assets of any Subsidiary of the Borrower in favor of the Borrower or any other
Wholly-Owned Subsidiary of the Borrower;
(xiii) Liens on the property or assets of Heritage Service Corp.
securing the Indebtedness permitted by clause (v) of Section 7B.2 provided that
(a) any such Lien shall at all times be contained to property or assets having
an aggregate fair market value not exceeding $2,000,000 and (b) such
indebtedness permitted by clause (v) of Section 7B.2 is owed to one or more of
the Banks;
(xiv) Liens created by any of the Security Documents securing (a)
Indebtedness evidenced by the Notes, the Acquisition Credit or the Working
Capital Credit) and (b) Additional Parity Debt; and
(xv) any Lien renewing, extending or refunding any Lien permitted by
this Section 7B.3, provided that (a) the principal amount of the Indebtedness
secured by any such Lien shall not exceed the principal amount of such
Indebtedness outstanding immediately prior to the renewal, extension or
refunding of such Lien and (b) no assets encumbered by any such Lien other than
the assets encumbered immediately prior to such renewal, extension or refunding
shall be encumbered thereby.
Notwithstanding the foregoing, the Borrower will not, and will not
permit any of its Subsidiaries to, create, assume or incur any Lien upon or with
respect to (a) any Subsidiary stock held by the Borrower or any other Subsidiary
of the Borrower, or (b) any of its proprietary software developed by or on
behalf of the Borrower or its Affiliates necessary and useful for the conduct of
the Business. No Lien permitted under this Section 7B.3 shall result in
over-collateralization except as required by conventional practice for specific
types of borrowings.
7B.4 Priority Debt. The Borrower will not permit Priority Debt, at any
time, to exceed the sum of (i) $5,000,000 plus (ii) 10% of the then Consolidated
Tangible Net Worth of the Borrower and its Subsidiaries(but only to the extent
such Consolidated Tangible Net Worth is positive). The provisions of this
Section 7B.4 are further limitations on Priority Debt that shall otherwise be
permitted by Section 7B.1, 7B.2 or 7B.3.
7B.5 Loans, Advances, Investments and Contingent Liabilities. The
Borrower will not, and will not permit any of its Subsidiaries to, directly or
indirectly, purchase or own any stock, obligations or securities of, or any
other interest in, or make any capital contribution to, any Person, make or
permit to remain outstanding any loan or advance to, or guarantee, endorse or
otherwise be or become contingently liable, directly or indirectly, in
connection with the obligations of any Person, or make any other Investment,
except:
(i) the Borrower or any of its Subsidiaries may make and own
Investments (w) consisting of Units issued for purposes of making acquisitions,
(x) arising out of loans and advances to employees incurred in the ordinary
course of business, and consisting of advances to pay reimbursable expenditures,
(y) arising out of extensions of trade credit or advances to third parties in
the ordinary course of business and (z) acquired by reason of the exercise of
customary creditors' rights upon default or pursuant to the bankruptcy,
insolvency or reorganization of a debtor;
(ii) Guarantees that constitute Indebtedness to the extent permitted by
Sections 7B.1 and 7B.2 and other Guarantees that are not Guarantees of
Indebtedness and are undertaken in the ordinary course of business;
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(iii) investment in (collectively, "Cash Equivalents")
(a) marketable obligations issued or unconditionally
guaranteed by the United States of America, or issued by any agency
thereof and backed by the full faith and credit of the United States of
America, in each case maturing one year or less from the date of
acquisition thereof,
(b) marketable direct obligations issued by any state of the
United States of America or any political subdivision of any such state
or any public instrumentality thereof maturing within one year from the
date of acquisition thereof and having as at such date the highest
rating obtainable from either Standard & Poor's Rating Group or Xxxxx'x
Investors Service, Inc.,
(c) commercial paper maturing no more than 270 days from the
date of creation thereof and having as at the date of acquisition
thereof one of the two highest ratings obtainable from either Standard
& Poor's Rating Group or Xxxxx'x Investors Service, Inc.,
(d) certificates of deposit maturing one year or less from the
date of acquisition thereof (1) issued by commercial banks incorporated
under the laws of the United States of America or any state thereof or
the District of Columbia or Canada or issued by the United States
branch of any commercial bank organized under the laws of any country
in Western Europe or Japan, with capital and stockholders' equity of at
least $500,000,000 (or the equivalent in the currency of such country),
(A) the commercial paper or other short term unsecured debt obligations
of which are as at such date rated either A-2 or better (or comparably
if the rating system is changed) by Standard & Poor's Rating Group or
Prime-2 or better (or comparably if the rating system is changed) by
Xxxxx'x Investors Service, Inc. or (B) the long-term debt obligations
of which are as at such date rated either A or better (or comparably if
the rating system is changed) by Standard & Poor's Rating Group or A2
or better (or comparably if the rating system is changed) by Xxxxx'x
Investors Service, Inc.("Permitted Banks") or (2) issued by BOk in an
aggregate amount for all such certificates of deposit issued by BOk not
to exceed $1,000,000,
(e) Eurodollar time deposits having a maturity of less than
270 days from the date of acquisition thereof purchased directly from
any Permitted Bank,
(f) bankers' acceptances eligible for rediscount under
requirements of The Board of Governors of the Federal Reserve System
and accepted by Permitted Banks, and
(g) obligations of the type described in clause (a), (b), (c),
(d) or (e) above purchased from a securities dealer designated as a
"primary dealer" by the Federal Reserve Bank of New York or from a
Permitted Bank as counterparty to a written repurchase agreement
obligating such counterparty to repurchase such obligations not later
than 14 days after the purchase thereof and which provides that the
obligations which are the subject thereof are held for the benefit of
the Borrower or any of its Subsidiaries by a custodian which is a
Permitted Bank and which is not a counterparty to the repurchase
agreement in question;
(iv) the Borrower or any of its Subsidiaries may acquire Capital Stock
or other ownership interests of a Person (i) located in the United States of
America or Canada, (ii) incorporated or otherwise formed pursuant to the laws of
the United States of America or Canada or any state or province thereof or the
District of Columbia and (iii) engaged in substantially the same business as the
Borrower which Person at the time of such acquisition is, or as a result thereof
becomes, a Subsidiary of the Borrower;
(v) the Borrower or any of its Subsidiaries may make and own
Investments (in addition to Investments permitted by clauses (i), (ii), (iii),
and (iv) of this Section 7B.5) in any Person incorporated or otherwise formed
pursuant to the laws of the United States of America or Canada or any state or
province thereof or the District of Columbia; provided, however, that (i) the
sum of (a) the aggregate amount of all such Investments made by the Borrower and
its Subsidiaries following the Closing Date which are outstanding pursuant to
this clause (v) plus (b) all other Investments held by the Borrower and its
Subsidiaries which are outstanding as of the Closing Date
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and listed on Schedule 7B.5 shall not at any date of determination exceed
$10,000,000 (the "Investment Limit"); (ii) the representation in Section 8.18
shall be true and correct as of the date of determination; and (iii) the
aggregate amount of all such Investments made by the Borrower and its
Subsidiaries and outstanding pursuant to this clause (v) in Persons engaged in a
business which is not substantially the same as a line of business described in
Section 7B.8 shall not at any date exceed $3,000,000 and (iv) no Investment
pursuant to this clause (v) may be made unless if after giving effect thereto no
Default or Event of Default exists;
(vi) the Borrower may make and become liable with respect to any
Interest Rate Agreements; and
(vii) any Subsidiary of the Borrower may make Investments in the
Borrower or in a Wholly-Owned Subsidiary of the Borrower.
7B.6 Restricted Payments. The Borrower will not directly or indirectly
declare, order, pay, make or set apart any sum for any Restricted Payment,
except that the Borrower may declare or order, and make, pay or set apart,
during each fiscal quarter a Restricted Payment if (i) such Restricted Payment
together with all other Restricted Payments during such fiscal quarter, do not
in the aggregate exceed the amount of Available Cash with respect to the
immediately preceding quarter, and (ii) no Default, Event of Default or
Noncompliance Event exists before or immediately after any such proposed action.
7B.7 Consolidation, Merger, Sale of Assets, etc. The Borrower will not,
and will not permit any of its Subsidiaries to, directly or indirectly,
(i) consolidate with or merge into any other Person or permit any other
Person to consolidate with or merge into it, except that:
(a) any Subsidiary of the Borrower may consolidate with or
merge into the Borrower or a Wholly-Owned Subsidiary of the Borrower if
the Borrower or a Wholly-Owned Subsidiary of the Borrower, as the case
may be, shall be the surviving Person; and
(b) any entity (other than a Subsidiary of the Borrower) may
consolidate with or merge into the Borrower or a Subsidiary if the
Borrower or a Subsidiary of the Borrower, as the case may be, shall be
the surviving Person and if, immediately after giving effect to such
transaction, (i) the Borrower and its Subsidiaries (x) shall not have a
Consolidated Net Worth, determined in accordance with GAAP applied on a
basis consistent with the consolidated financial statements of the
Borrower most recently delivered pursuant to Section 7A.1, of less than
the Consolidated Net Worth of the Borrower immediately prior to the
effectiveness of such transaction, satisfaction of this requirement to
be set forth in reasonable detail in an Officers' Certificate delivered
to each holder of a Note at the time of such transaction, and (y) could
incur at least $1.00 of additional Indebtedness in compliance with
Section 7B.1 and clause (xiv) of Section 7B.2, (ii) substantially all
of the assets of the Borrower and its Subsidiaries, taken as a whole,
shall be located and substantially all of their business shall be
conducted within the continental United States of America or Canada and
(iii) no Default, Event of Default or Noncompliance Event shall exist
and be continuing;
(ii) sell, lease, abandon or otherwise dispose of all or substantially
all its assets, except that any Subsidiary of the Borrower may sell, lease or
otherwise dispose of all or substantially all its assets to the Borrower or to a
Wholly-Owned Subsidiary of the Borrower; or
(iii) sell, lease, convey, abandon or otherwise dispose of (including,
without limitation, in connection with a Sale and Lease-Back Transaction) any of
its assets (except in a transaction permitted by clause (i)(a), (i)(b), (i)(c),
(ii)(a) or (ii)(b) of this Section 7B.7 or sales of inventory in the ordinary
course of business consistent with past practice) or issue or sell Capital Stock
of any Subsidiary of the Borrower, whether in a single transaction or a series
of related transactions (each of the foregoing non-excepted transactions, an
"Asset Sale"), unless:
(a) immediately after giving effect to such proposed
disposition no Default, Event of Default or Noncompliance Event shall
exist and be continuing, satisfaction of this requirement to be set
forth in reasonable detail in an Officer's Certificate delivered to
each holder of a Note at the time of such
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transaction in the case of any Asset Sale involving assets that
generates EBITDA and such Asset Sale involves consideration of $250,000
or more;
(b) such sale or other disposition is for cash consideration
or for consideration consisting of not less than 75% cash and not more
than 25% interest-bearing promissory notes; provided, that the 75%
limitation referred to in this clause (b) shall not apply to any Asset
Sale consisting solely of a sale or other disposition of land and
buildings for an interest bearing promissory note as long as the amount
of such promissory note does not exceed $250,000;
(c) one of the following two conditions must be satisfied:
(i) (x) the aggregate Net Proceeds of all assets so
disposed of (whether or not leased back) over the immediately
preceding 12-month period does not exceed $3,000,000 and (y)
the aggregate Net Proceeds of all assets so disposed of
(whether or not leased back) from the Closing Date through the
date of such disposition does not exceed $10,000,000; or
(ii) in the event that such Net Proceeds (less the
amount thereof previously applied in accordance with clause
(x) of this clause (c)(ii)) exceeds the limitations determined
pursuant to clauses (x) and (y) of clause (c)(i) of this
Section 7B.7 (such excess amount being herein called "Excess
Sale Proceeds"), the Borrower shall within 12 calendar months
of the date on which such Net Proceeds exceeded any such
limitation, cause an amount equal to such Excess Sale Proceeds
to be applied (x) to the acquisition of assets in replacement
of the assets so disposed of or of assets which may be
productively used in the United States of America or Canada in
the conduct of the Business, or (y) to the extent not applied
pursuant to the immediately preceding clause (x), to offer to
make prepayments on the Notes pursuant to Section 4.2.3 hereto
and, allocated on the basis specified for such prepayments in
the definition of Allocable Proceeds, to offer to repay other
Parity Debt (other than Indebtedness under Section 7B.2 (ii)
or that by its terms does not permit such offer to be made);
and
(d) the Borrower shall have delivered to the Noteholders a
Certificate of the Board of Directors of the General Partner,
certifying that such sale or other disposition is for fair value and is
in the best interests of the Borrower.
Notwithstanding the foregoing, Asset Sales shall not be deemed to
include (1) any transfer of assets or issuance or sale of Capital Stock by the
Borrower or any of its Subsidiaries to the Borrower or a Wholly-Owned Subsidiary
of the Borrower, (2) any transfer of assets or issuance or sale of Capital Stock
by the Borrower or any of its Subsidiaries to any Person in exchange for, or the
Net Proceeds of which are applied within 12 months to the purchase of, other
assets used in a line of business permitted under Section 7B.8 and having a fair
market value (as determined in good faith by the Board of Directors of the
General Partner) not less than that of the assets so transferred or Capital
Stock so issued or sold and (3) any transfer of assets pursuant to an Investment
permitted by Section 7B.5.
7B.8 Business. The Borrower will not and will not permit any of its
Subsidiaries to engage in any line of business if as a result thereof the
Borrower and its Subsidiaries would not be principally and predominately engaged
in the Business and related general and administrative operations, as more fully
described in the Memorandum and subject in all respects to the provisions of
clause (iii) of the proviso to Section 7B.5(v).
7B.9 Transactions with Affiliates. The Borrower will not, and will not
permit any of its Subsidiaries to, directly or indirectly, engage in any
transaction with any Affiliate unless (i) (a) such transaction is on fair and
reasonable terms that are no less favorable to the Borrower or such Subsidiary,
as the case may be, than those which would be obtained in an arm's-length
transaction from a Person other than an Affiliate and (b) such transaction is
entered into in the ordinary course of business and pursuant to the reasonable
requirements at the time of the Borrower's or such Subsidiary's operations, or
(y) such transaction involves the acquisition by the Borrower from the General
Partner of assets formerly owned by an entity, the Capital Stock of which was
purchased by the General Partner, which acquisition is for a substantially
equivalent value as the value of such purchase consummated within
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ten days after the consummation of such purchase, as long as such transaction
otherwise would be permitted hereunder had the Borrower acquired such assets
directly from such entity (including, for example, the acquisition by the
Borrower from the General Partner of assets formerly owned by Kingston Propane,
Inc.) (ii) such transaction is in connection with the incurrence of Indebtedness
pursuant to Section 7B.2(viii), (iii) such transaction is in connection with the
making of an Investment pursuant to Section 7B.5(i), (iv) such transaction is a
Restricted Payment permitted by Section 7B.6, (v) such transaction involves
performance under the Contribution Agreement (substantially in the form in
effect on the Closing Date), (vi) such transaction involves indemnification and
contribution under Section 7.7 of the Partnership Agreement (as said section is
in effect on the Closing Date), to the extent such indemnification or
contribution arises from operations or activities in connection with the
Business (including securities issuances in connection with funding the
Business) or (vii) such transaction is a specific transaction described in the
Registration Statement.
7B.10 Subsidiary Stock and Indebtedness.
(i) The Borrower will not permit any of its Subsidiaries directly or
indirectly to issue or sell any Equity Interest of such Subsidiary of the
Borrower to any Person other than the Borrower or a Wholly-Owned Subsidiary of
the Borrower except (a) for the purpose of qualifying directors or (b) in
satisfaction of pre-emptive rights of holders of minority interests which are
triggered by an issuance of Equity Interests to the Borrower or a Subsidiary of
the Borrower and permit such holders to maintain their pro rata interests.
(ii) The Borrower will not directly or indirectly sell, assign, pledge
or otherwise dispose of any Equity Interest in or any Indebtedness of any of its
Subsidiaries, and will not permit any of its Subsidiaries directly or indirectly
to sell, assign, pledge or otherwise dispose of any Equity Interest in or any
Indebtedness of any other Subsidiary of the Borrower except to the Borrower or a
Wholly-Owned Subsidiary of the Borrower, unless (a) simultaneously with such
sale, transfer or disposition, all of the Equity Interests (other than an Equity
Interest representing less than 2% of the outstanding Equity Interests of all
classes of such Subsidiary taken together, provided that such Equity Interest is
considered an Investment pursuant to Section 7B.5(v) and is permitted
thereunder) or Indebtedness of such Subsidiary owned by the Borrower and its
Subsidiaries is sold, transferred or disposed of as an entirety, (b) the Board
of Directors of the General Partner shall have determined, as evidenced by a
resolution thereof, that the proposed sale, transfer or disposition of such
Equity Interests or Indebtedness is in the best interests of the Borrower, (c)
such Equity Interests or Indebtedness are sold, transferred or otherwise
disposed of for cash or Cash Equivalents or other assets used in a line of
business permitted by Section 7B and having a fair market value (as determined
in good faith by the Board of Directors of the General Partner) not less than
that of the Equity Interests or Indebtedness so transferred, to a Person upon
terms deemed by the Board of Directors of the General Partner to be acceptable,
(d) the Subsidiary being sold, transferred or otherwise disposed of shall not
have any continuing investment in the Borrower or any Subsidiary of the Borrower
not being so sold, transferred or disposed and (e) such sale, transfer or
disposition is permitted by Section 7B.7.
7B.11 Payment of Dividends by Subsidiaries. The Borrower will not, and
will not permit any of its Subsidiaries to, be subject to or enter into any
agreement which restricts the ability of any Subsidiary of the Borrower to
declare or pay any dividend to the Borrower, to make any distribution on any
Equity Interest of such Subsidiary to the Borrower, or to lend money to the
Borrower.
7B.12 Sales of Receivables. The Borrower will not, and will not permit
any of its Subsidiaries to, discount, pledge, sell (with or without recourse),
or otherwise sell for less than face value thereof any of its accounts or notes
receivable, except for sales of receivables (i) without recourse which are
seriously past due and which have been substantially written off as
uncollectible or collectible only after extended delays, or (ii) made in
connection with the sale of a business but only with respect to the receivables
directly generated by the business so sold.
7B.13 Material Agreements; Tax Status. The Borrower will not:
(i) amend or directly or indirectly modify in any manner the
definitions of "Allocable Proceeds" or "Excess Proceeds" of the Note Purchase
Agreement or any similar provisions of any agreement applicable to any
extensions, renewals or refundings thereof as Parity Debt under the provisions
of paragraph 7B.2(i);
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(ii) amend or modify in any manner adverse to the holders of the Notes,
or grant any waiver or release under (if such action shall be adverse to the
holders of the Notes), any Partnership Document, any notes evidencing Parity
Debt or any agreement relating to Parity Debt or terminate in any manner any
Partnership Document, it being understood, without limitation, that no
modification that reduces principal, interest or fees, premiums, make-wholes or
penalty charges, or extends any scheduled or mandatory payment, prepayment or
redemption of principal or interest, or makes less restrictive any agreement or
releases away any security, or waives any condition precedent or default shall
be adverse to the holders of the Notes for purposes of this Agreement; or
(iii) permit the Master Partnership or the Borrower to be treated as an
association taxable as a corporation or otherwise to be taxed as an entity for
federal income tax purposes.
ARTICLE VIII
REPRESENTATIONS, COVENANTS AND WARRANTIES
The Borrower represents, covenants and warrants as follows:
8.1 Organization. The Borrower is a limited partnership duly organized,
validly existing and in good standing under the laws of the State of Delaware
and has all requisite partnership power and authority to own and operate its
properties (including without limitation the assets owned and operated by it),
to conduct its business, to enter into this Agreement and the other Loan
Documents to which it is a party and the Operative Agreements and to carry out
the terms of this Agreement, the Notes, such other Loan Documents and Operative
Agreements. Each Subsidiary of the Borrower is duly organized, validly existing
and in good standing under the laws of its state of organization and has all
requisite power and authority to own and operate its properties (including
without limitation the assets owned and operated by it).
8.2 Partnership Interests. The sole general partner of the Borrower is
Heritage, which owns a 1.0101 general partner interest in the Borrower. At the
Closing Date, the Borrower does not have any Subsidiary other than the
Subsidiaries of the Borrower as set forth on Schedule 8.2 or any Investments in
any Person (other than as set forth on Schedules 7B.5 or 8.2 or Investments of
the types described in Section 7B.5(i), (ii), (iii) or (vi)).
8.3 Qualification. The Borrower is duly qualified or registered and is
in good standing as a foreign limited partnership for the transaction of
business, and each of the Subsidiaries of the Borrower is duly qualified or
registered and is in good standing as a foreign corporation or partnership, as
the case may be, for the transaction of business, in the states and to the
extent listed in Schedule 8.3, and, except as reflected on Schedule 8.3, on the
Closing Date there are no other jurisdictions in which the nature of their
respective activities or the character of the properties they own, lease or use
makes such qualification or registration necessary and in which the failure so
to qualify or to be so registered would have a Material Adverse Effect. The
Borrower has taken all necessary partnership action to authorize the execution,
delivery and performance by it of this Agreement, the other Financing Documents
to which it is a party and the Operative Agreements. The Borrower has duly
executed and delivered each of this Agreement, the other Loan Documents and the
Operative Agreements to which it is a party, and each of such documents and
agreements and the Notes and the Security Documents constitute the legal, valid
and binding obligation of the Borrower enforceable against it in accordance with
its terms, except as such enforceability may be limited by bankruptcy,
insolvency, moratorium or similar laws affecting creditors' rights generally and
general principles of equity (regardless of whether such enforceability is
considered in a proceeding in equity or at law).
8.4 Financial Statements. The Borrower has delivered to the
Administrative Agent complete and correct copies of the audited financial
statements of the Borrower as of August 31, 1998. Such financial statements have
been prepared in accordance with GAAP and fairly present in all material
respects the financial position of the Borrower as of August 31, 1998.
8.5 Actions Pending. There is no action, suit, investigation or
proceeding pending or, to the knowledge of the Borrower, threatened against the
Borrower or the General Partner or any of the Subsidiaries of the Borrower, or
any properties or rights of the Borrower or the General Partner or any of the
Subsidiaries of the Borrower, by or before any court, arbitrator or
administrative or governmental body (i) which questions the validity
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or enforceability of this Agreement, the Notes, any other Financing Document or
any Operative Agreement or any action to be taken pursuant to this Agreement,
the Notes, any other Loan Document or any Operative Agreement or (ii) which
could reasonably be expected to result in a Material Adverse Effect.
8.6 Changes. Except as contemplated by this Agreement, the Notes, the
other Financing Documents or the Operative Agreements or as described in the
Registration Statement or the Memorandum, (i) neither the Borrower nor any of
the Subsidiaries of the Borrower has incurred any material liabilities or
obligations, direct or contingent, nor entered into any material transaction, in
each case other than in the ordinary course of business, and (ii) there has not
been any material adverse change in or effect on the business, assets, financial
condition or prospects of the Borrower or any of the Subsidiaries of the
Borrower.
8.7 Outstanding Indebtedness. Other than the Credit Obligations
represented by the Notes, neither the Borrower nor any of the Subsidiaries of
the Borrower as set forth on Schedule 8.2 has outstanding any Indebtedness
except as set forth on Schedule 8.7 and any such Indebtedness which is indicated
in Schedule 8.7 to be paid in full on the Closing Date will be paid in full at
the time of Closing. There exists no default under the provisions of any
instrument evidencing such Indebtedness or of any agreement relating thereto. On
the Closing Date, no instrument or agreement to which the Borrower or any of the
Subsidiaries of the Borrower is a party or by which the Borrower, any such
Subsidiary, or their respective properties is bound (other than this Agreement
and the Note Purchase Agreement and other than as indicated in Schedule 8.7)
will contain any restriction on the incurrence by the Operating Partnership or
any of the Subsidiaries of the Borrower of additional Indebtedness.
8.8 Transfer of Assets and Business; Title to Properties.
(i) Except as set forth on Schedule 8.8, the Borrower and the
Subsidiaries of the Borrower will at the Closing Date be in possession of, and
operating in compliance with, all franchises, grants, authorizations, approvals,
licenses, permits, easements, rights-of-way, consents, certificates and orders
(collectively, the "Permits") required (a) to own, lease or use its properties
(including without limitation to own, lease or use the Assets owned, leased or
used by it) and (b) considering all such Permits in the possession of, and
complied with by, the Borrower and its Subsidiaries taken together, to permit
the conduct of the Business as now conducted and proposed to be conducted,
except for those Permits (x) which are routine and administrative in nature and
are expected in the reasonable judgment of the Borrower to be obtained or given
in the ordinary course of business from time to time after the Closing Date, and
(y) which, if not obtained or given, would not, individually or in the
aggregate, present a reasonable likelihood of having a Material Adverse Effect,
(ii) Except as set forth on Schedule 8.8, on and after the Closing
Date, the Borrower and the Subsidiaries of the Borrower will have, (i) good and
marketable title to, or valid leasehold interests in, all of the Assets
constituting real property except for defects in, or lack of recorded, title and
exceptions to leasehold interests that either alone or in the aggregate could
not reasonably be expected to result in a Material Adverse Effect, and (ii) good
and sufficient title to, or valid rights to use, all of the Assets constituting
personal property reasonably necessary for the operation of such personal
property as it is used on the date hereof and proposed to be used in the
Business, in each case subject to no Liens except such as are permitted by
Section 7B.3. The Assets owned by the Borrower and the Subsidiaries of the
Borrower will be all of the assets and properties reasonably necessary to enable
the Borrower and its Subsidiaries to conduct the Business on the Closing Date.
Subject to such exceptions as would not, individually or in the aggregate,
present a reasonable likelihood of having a Material Adverse Effect (A) on the
date hereof the Borrower and its Subsidiaries enjoy, peaceful and undisturbed
possession under all leases and subleases necessary in any material respect for
the conduct of the Business, and (B) all such leases and subleases are valid and
subsisting and are in full force and effect. None of the properties or assets of
the Borrower or any of the Subsidiaries of the Borrower is subject to any Lien
other than Liens that would be permitted to be imposed pursuant to Section 7B.3
as of the Closing Date, immediately after giving effect to the Transactions.
8.9 Taxes. On the Closing Date each of the Operating Partnership and
its Subsidiaries will have filed all federal, state and other income tax returns
which, to the knowledge of the Borrower, are required to be filed or will have
properly filed for extensions of time for the filing thereof, and has paid all
taxes, assessments and other governmental charges levied upon it or any of its
properties, assets, income or franchises as shown to be due on such returns,
except those which are not past due or are being contested in good faith in
compliance with Section 7A.5.
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The Borrower is a limited partnership not subject to taxation with respect to
its income or gross receipts under applicable state laws and that is treated as
a pass-through entity for U.S. federal income tax purposes.
8.10 Compliance with Other Instruments, etc.; Solvency.
(i) On the Closing Date, immediately prior to the completion of the
transactions contemplated by this Agreement, the Notes, the other Loan Documents
and the Operative Agreements), neither the Borrower nor any of the Subsidiaries
of the Borrower will be in violation of (a) any provision of its certificate or
articles of incorporation or other constitutive documents or its by-laws, (b)
any provision of any agreement or instrument to which it is a party or by which
any of its properties is bound or (c) any applicable law, ordinance, rule or
regulation of any Governmental Authority or any applicable order, judgment or
decree of any court, arbitrator or Governmental Authority except (in the case of
clauses (b) and (c) above only) for such violations which would not,
individually or in the aggregate, present a reasonable likelihood of having a
Material Adverse Effect.
(ii) The execution, delivery and performance of this Agreement, the
Notes, the other Loan Documents and the Operative Agreements, and the completion
of the transactions contemplated by the Registration Statement to occur prior to
the Closing Date (including without limitation the transactions contemplated by
this Agreement, the Notes, the other Loan Documents and the Operative
Agreements) will not violate (a) any provision of the certificate or articles of
incorporation or other constitutive documents or by-laws of the Borrower, the
General Partner or any of the Subsidiaries of the Borrower, (b) any applicable
law, ordinance, rule or regulation of any Governmental Authority or any
applicable order, judgment or decree of any court, arbitrator or Governmental
Authority, or (c) any provision of any agreement or instrument to which the
Borrower, the General Partner or any of the Subsidiaries of the Borrower is a
party or by which any of its properties is bound.
(iii) Upon completion of the transactions contemplated by this
Agreement, the Notes, the other Loan Documents and the Operative Agreements),
none of the Borrower, the General Partner or any Subsidiary of the Borrower
shall (a) be insolvent, (b) be engaged or about to engage in business or a
transaction at a time the Borrower, the General Partner or any Subsidiary of the
Borrower could be viewed as having unreasonably small capital, or (c) intend to
incur, or believe that it would incur, debts that would be beyond its ability to
pay as such debts matured.
8.11 Governmental Consent. No consent, approval or authorization of, or
declaration or filing with, any Governmental Authority is required for the valid
execution, delivery and performance of this Agreement, the Notes, the other Loan
Documents or the Operative Agreements.
8.12 Use of Proceeds. None of the proceeds of the Loans will be used,
directly or indirectly, for the purpose, whether immediate, incidental or
ultimate, of purchasing or carrying any margin stock (as defined in Section 8.17
hereof) or for the purpose of maintaining, reducing or retiring any indebtedness
which was originally incurred to purchase or carry any stock that is currently a
margin stock or for any other purpose which might constitute this transaction a
"purpose credit" within the meaning of such Regulation U or X. The Borrower nor
anyone acting on their respective behalfs has taken or will take any action
which might cause this Agreement or the Notes to violate Regulation U,
Regulation T or any other regulation of the Board of Governors of the Federal
Reserve System or to violate the Exchange Act, in each case as in effect now or
as the same may hereafter be in effect.
8.13 ERISA. The Borrower and their respective ERISA Affiliates is in
compliance in all material respects with the applicable provisions of ERISA and
the Code and the regulations and published interpretations thereunder. No ERISA
Event has occurred or is reasonably expected to occur that, when taken together
with all other such ERISA Events, could reasonably be expected to result in a
Material Adverse Effect. The present value of all benefit liabilities under each
Plan (based on those assumptions used for purposes of Statement of Financial
Accounting Standards No. 87) did not, as of the last annual valuation date
applicable thereto, exceed by more than $2,000,000 the fair market value of the
assets of such Plan, and the present value of all benefit liabilities of all
underfunded Plans (based on those assumptions used for purposes of Statement of
Financial Accounting Standards No. 87) did not, as of the last annual valuation
dates applicable thereto, exceed by more than $2,000,000 the fair market value
of the assets of all such underfunded Plans.
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8.14 Environmental Compliance.
(i) Except where the failure to be in compliance could not present a
reasonable likelihood of having a Material Adverse Effect, as of the date hereof
the Borrower and each Subsidiary of the Borrower is in compliance with all
Environmental Laws applicable to it and to the Business or Assets. The Borrower
and each Subsidiary of the Borrower is in compliance with all franchises,
grants, authorizations, permits, licenses, and approvals required under
Environmental Laws, except for any non-compliance or failure to obtain such
Permits which could not reasonably be expected to have a Material Adverse
Effect. The Borrower has caused Heritage to submit timely and complete
applications to renew any expired or expiring Permits required pursuant to any
Environmental Law, except for any non-compliance or failure to obtain such
permits which could not reasonably be expected to have a Material Adverse
Effect. All reports, documents, or other submissions required by Environmental
Laws to be submitted by the Borrower to any Governmental Authority or Person
have been filed by or on behalf of the Borrower, except where the failure to do
so would not present a reasonable likelihood of having a Material Adverse
Effect.
(ii) (a) There is no Hazardous Substance present at any of the real
property currently owned or leased by the Borrower or any of the Subsidiaries of
the Borrower except to the extent that such presence could not reasonably be
expected to have a Material Adverse Effect, and (b) to the knowledge of the
Borrower, there was no Hazardous Substance present at any of the real property
formerly owned or leased by Heritage during the period of ownership or leasing
by such Person; and with respect to such real property and subject to the same
knowledge and temporal qualifiers concerning Hazardous Substances with respect
to formerly owned or leased real properties, there has not occurred (x) any
release, or to the knowledge of the Borrower, any threatened release of a
Hazardous Substance, or (y) any discharge or, to the knowledge of the Borrower,
any threatened discharge of any Hazardous Substance into the ground, surface or
navigable waters which discharge or threatened discharge violates any federal,
state, local or foreign laws, rules or regulations concerning water pollution.
(iii) Neither the Borrower nor any of the Subsidiaries of the Borrower
has disposed of, transported, or arranged for the transportation or disposal of
any Hazardous Substance where such disposal, transportation, or arrangement
would give rise to liability pursuant to CERCLA or any analogous state statute
other than any such liabilities that could not reasonably be expected to have a
Material Adverse Effect.
(iv) Except as disclosed to the Banks in writing, (a) no Lien has been
asserted by any Governmental Authority or person resulting from the use, spill,
discharge, removal, or remediation of any Hazardous Substance with respect to
any real property currently owned or leased by Heritage or the Borrower, and (b)
to the knowledge of the Borrower, no such Lien was asserted with respect to any
of the real property formerly owned or leased by Heritage during the period of
ownership or leasing of the real property by such Person.
(v) (a) There are no underground storage tanks, asbestos-containing
materials, polychlorinated biphenyls, or urea formaldehyde insulation at any of
the real property currently owned or leased by the Borrower in violation of any
Environmental Law, and (b) to the knowledge of the Borrower, there were no
underground storage tanks, asbestos-containing materials, polychlorinated
biphenyls, or urea formaldehyde insulation at any of the real property formerly
owned or leased by Heritage in violation of any Environmental Law during the
period of ownership or leasing of such real property by such Person.
(vi) As of the date hereof, any propane is stored, used and handled by
the Borrower and the Subsidiaries of the Borrower in compliance with all
applicable Environmental Laws except for any storage, use or handling of propane
that could not reasonably be expected to have a Material Adverse Effect.
8.15 Pre-emptive Rights. There are no pre-emptive rights to which a
holder of a minority interest in any Subsidiary of the Borrower is entitled.
8.16 Disclosure. This Agreement, the Notes, the other Loan Documents,
the Operative Agreements, the Memorandum and any other document, certificate or
statement furnished to any Bank by or on behalf of the Borrower, the General
Partner or their respective Subsidiaries or Affiliates, in connection herewith,
taken together, do not contain any untrue statement of a material fact or omit
to state a material fact necessary in order to make the
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statements contained herein and therein, in light of the circumstances under
which they were made, not misleading. There is no fact known to the Borrower
which has or in the future could reasonably be expected to have (so far as the
Borrower can now foresee) a Material Adverse Effect and which has not been set
forth in this Agreement or in the other documents, certificates and statements
furnished to each the Banks hereunder by or on behalf of the Borrower.
8.17 Federal Reserve Regulations. Neither the Borrower nor the
Subsidiary of the Borrower will, directly or indirectly, use any of the proceeds
of any Loan for the purpose, whether immediate, incidental or ultimate, of
buying a "margin stock" or of maintaining, reducing or retiring any indebtedness
originally incurred to buy a stock that is currently a "margin stock", or for
any other purpose which might constitute this transaction a "purpose credit"
which is secured "directly or indirectly by margin stock", in each case within
the meaning of Regulation U of the Board of Governors of the Federal Reserve
System (12 C.F.R. 207, as amended), or otherwise take or permit to be taken any
action which would involve a violation of such Regulation U or of Regulation X
(12 C.F.R. 224, as amended) or any other applicable regulation of such Board. No
indebtedness being retired, directly or indirectly, out of the proceeds of the
Loans will be incurred for the purpose of buying or carrying any stock which is
currently a "margin stock", and the Borrower neither owns or has any present
intention of acquiring any amount of such "margin stock".
8.18 Investment Borrower Act. None of the Borrower or any Subsidiary of
the Borrower is an "investment Borrower", or a Borrower "controlled" by an
"investment Borrower", within the meaning of the Investment Borrower Act of
1940, as amended.
8.19 Public Utility Holding Company Act. The Borrower, the General
Partner and each Subsidiary of the Borrower is exempt from all of the provisions
of the Public Utility Holding Company Act of 1935, as amended (the "PUHCA") and
the rules thereunder other than Section 9(a)(2) thereof based upon a no-action
letter from the Commission dated June 19, 1996.
8.20 Year 2000. The Borrower has developed and implemented a
comprehensive, detailed program to address on a timely basis the "Year 2000
Problem" (that is, the risk that computer applications used by the Borrower may
be unable to recognize and perform properly date-sensitive functions involving
certain dates prior to and any date after December 31, 1999) and reasonably
anticipates that it will on a timely basis successfully resolve any Year 2000
problem for all material computer applications used by it, and the Borrower, on
the basis of inquiries made, believes that each supplier, vendor and customer of
the Borrower that is of material importance to the financial well-being of the
Borrower will also successfully resolve on a timely basis the Year 2000 Problem
for all of its material computer applications.
ARTICLE IX
EVENTS OF DEFAULT
9.1 Acceleration. If any of the following conditions or events ("Events
of Default") shall occur and be continuing for any reason whatsoever (and
whether such occurrence shall be voluntary or involuntary or come about or be
effected by operation of law or otherwise):
(i) the Borrower defaults in the payment of any principal of on any
Note when the same becomes due and payable, either by the terms thereof or
otherwise as herein provided; or
(ii) the Borrower defaults in the payment of any interest on any Note
for more than 5 days after the same becomes due and payable; or
(iii) the Borrower or any Subsidiary of the Borrower (whether as
primary obligor or as guarantor or other surety) defaults in any payment of
principal of or interest on any Parity Debt or any other Indebtedness other than
the Notes (including without limitation any Capitalized Lease Obligation, any
obligation under a conditional sale or other title retention agreement, any
obligation issued or assumed as full or partial payment for property whether or
not secured by a purchase money mortgage or any obligation under notes payable
or drafts accepted
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representing extensions of credit), beyond any period of grace provided with
respect thereto, or the Borrower or any Subsidiary of the Borrower fails to
perform or observe any other agreement or term or condition contained in any
agreement under which any such obligation is created (or if any other event
thereunder or under any such agreement shall occur and be continuing) and the
effect of such failure or other event is to cause, or to permit the holder or
holders of such Indebtedness (or a trustee on behalf of such holder or holders)
to cause, such obligation to become due or to be repurchased prior to any stated
maturity, provided that the aggregate amount of all Indebtedness as to which
such a default (payment or other) shall occur and be continuing or such a
failure or other event causing or permitting acceleration (or resale to the
Borrower or any Subsidiary of the Borrower) shall occur and be continuing
exceeds $2,000,000; provided, further, that no waiver, modification or amendment
relating to any such a default (payment or other) or such a failure or other
event with respect to any Parity Debt or agreement or instrument relating to any
Parity Debt shall be effective for purposes of this clause (iii) if any
consideration (other than the payment of reasonable attorney's fees) is given,
directly or indirectly, by the Borrower or any of its Subsidiaries or Affiliates
in respect thereof, unless substantially the same consideration is given to the
holders of the Notes; or
(iv) any representation or warranty made in any writing by or on behalf
of the Borrower, General Partner or the Master Partnership in this Agreement,
any other Loan Document or any instrument furnished pursuant to this Agreement
or any Loan Document shall prove to have been false or incorrect in any material
respect on the date as of which made; or
(v) the Borrower fails to perform, observe or comply with any agreement
contained in Sections 7B.1 through 7B.13; or
(vi) the Borrower fails to perform or observe any other agreement, term
or condition contained in this Agreement or the other Loan Documents and such
failure shall not be remedied within 30 days after any Responsible Officer
obtains actual knowledge or notice thereof; or
(vii) the General Partner, the Borrower or any Significant Subsidiary
Group makes an assignment for the benefit of creditors or is generally not
paying its debts as such debts become due; or
(viii) any decree or order for relief in respect of the General
Partner, the Borrower or any Significant Subsidiary Group is entered under any
bankruptcy, reorganization, compromise, arrangement, insolvency, readjustment of
debt, dissolution or liquidation or similar law, whether now or hereafter in
effect (herein called the "Bankruptcy Law"), of any jurisdiction; or
(ix) the General Partner, the Borrower or any Significant Subsidiary
Group petitions or applies to any tribunal for, or consents to, the appointment
of, or taking possession by, a trustee, receiver, custodian, liquidator or
similar official of the General Partner, the Borrower or any Significant
Subsidiary Group , or of any substantial part of the assets of the General
Partner, the Borrower or any Significant Subsidiary Group, or commences a
voluntary case under the Bankruptcy Law of the United States or any proceedings
(other than proceedings for the voluntary liquidation and dissolution of the
General Partner, the Borrower or any Significant Subsidiary Group) relating to
the General Partner, the Borrower or any Significant Subsidiary Group under the
Bankruptcy Law of any other jurisdiction; or
(x) any such petition or application is filed, or any such proceedings
are commenced, against the General Partner, the Borrower or any Significant
Subsidiary Group and the General Partner, the Borrower or any Significant
Subsidiary Group by any act indicates its approval thereof, consents thereto or
acquiesces therein, or an order, judgment or decree is entered appointing any
such trustee, receiver, custodian, liquidator or similar official, or approving
the petition in any such proceedings, and such order, judgment or decree remains
unstayed and in effect for more than 30 days; or
(xi) a judgment or judgments for the payment of money in excess of
$2,000,000 in the aggregate (except to the extent covered by insurance as to
which the insurer has acknowledged in writing its obligation to cover in full)
shall be rendered against the Borrower or any Subsidiary of the Borrower and
either (i) enforcement proceedings have been commenced by any creditor upon such
judgment or order or (ii) within 45 days after entry
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thereof, such judgment is not discharged or execution thereof stayed pending
appeal, or within 45 days after the expiration of any such stay, such judgment
is not discharged; or
(xii) any order, judgment or decree is entered in any proceedings
against the General Partner, the Borrower or any Significant Subsidiary Group
decreeing the dissolution of the General Partner, the Borrower or any
Significant Subsidiary Group and such order, judgment or decree remains unstayed
and in effect for more than 30 days or any other event occurs that results in
the termination, dissolution or winding up of the Borrower, subject to Section
7B.7, the General Partner or any Significant Subsidiary Group; or
(xiii) any order, judgment or decree is entered in any proceedings
against the Borrower or any of its Subsidiaries decreeing a split-up of the
Borrower or such Subsidiary which requires the divestiture of assets
representing a substantial part, or the divestiture of the stock of a Subsidiary
of the Borrower whose assets represent a substantial part of the consolidated
assets of the Borrower and its Subsidiaries (determined in accordance with GAAP)
or which requires the divestiture of assets, or stock of a Subsidiary of the
Borrower, which shall have contributed a substantial part of the Consolidated
Net Income of the Borrower and its Subsidiaries for any of the three fiscal
years then most recently ended, and such order, judgment or decree shall not be
dismissed or execution thereon stayed pending appeal or review within 45 days
after entry thereof, or in the event of such a stay, such order, judgment or
decree shall not be dismissed within 45 days after such stay expires; or
(xiv) any of the Security Documents shall at any time, for any reason
cease to be in full force and effect or shall fail to constitute a valid,
perfected first priority Lien with respect to the Collateral subject to Liens
permitted by the Security Agreement or shall be declared to be null and void in
whole or in any material respect (i.e., relating to the validity or priority of
the Liens created by the Security Documents or the remedies available
thereunder) by the judgment of any court or other Governmental Authority having
jurisdiction in respect thereof, or if the validity or the enforceability of any
of the Security Documents shall be contested by or on behalf of the Borrower, or
the Borrower shall renounce any of the Security Documents, or deny that it is
bound by the terms of any of the Security Documents; or
(xv) (a) the General Partner shall be engaged in any business or
activities other than those permitted by the Partnership Agreement as in effect
on the Closing Date, or (b) the General Partner ceases to be the sole general
partner of the Borrower or the Master Partnership, or (c) Current Management
shall own, directly or indirectly, less than 51% of the Capital Stock of the
General Partner; or
(xvi) an ERISA Event shall have occurred that, when taken together with
all other such ERISA Events that have occurred, could reasonably be expected to
result in liability of the Borrower and its ERISA Affiliates in an aggregate
amount exceeding $2,000,000; or
(xvii) an event of default under any of the Security Documents has
occurred and is continuing.
9.2 Remedies. Upon the occurrence of any Event of Default referred to
in (viii), (ix) or (x) of this Section 9.1 the Commitments shall immediately
terminate and the Notes and all other Indebtedness shall be immediately due and
payable, without further notice of any kind. Upon the occurrence of any other
Event of Default, and without prejudice to any right or remedy of the Banks
under this Agreement or the Loan Documents or under applicable Law of under any
other instrument or document delivered in connection herewith, the Banks may (i)
declare the Commitments terminated or (ii) declare the Commitments terminated
and declare the Notes and the other Indebtedness, or any part thereof, to be
forthwith due and payable, whereupon the Notes and the other Indebtedness, or
such portion as is designated by the Banks shall forthwith become due and
payable, without presentment, demand, notice or protest of any kind, all of
which are hereby expressly waived by the Borrower. No delay or omission on the
part of the Banks in exercising any power or right hereunder or under the Notes,
the Loan Documents or under applicable law shall impair such right or power or
be construed to be a waiver of any default or any acquiescence therein, nor
shall any single or partial exercise by the Banks of any such power or right
preclude other or further exercise thereof or the exercise of any other such
power or right by the Banks. In the event that all or part of the Indebtedness
becomes or is declared to be forthwith due and payable as herein provided, the
Banks shall have the right to set off the amount of all the Indebtedness of the
Borrower owing to the Banks against, and shall have, and is hereby granted by
the Borrower, a lien upon and security interest in, all property of each of the
Borrower in the Banks' possession at or subsequent to such default, regardless
of the capacity in which the Banks possess such property, including but not
limited to any balance or share of any deposit, collection or agency account.
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After Default all proceeds received by the Banks may be applied to the
Indebtedness in such order of application and such proportions as the Banks, in
their discretion, shall choose. At any time after the occurrence of any Event of
Default, the Banks may, at their option, cause an audit of any and/or all of the
books, records and documents of the Borrower to be made by auditors satisfactory
to the Banks at the expense of the Borrower. The Banks also shall have, and may
exercise, each and every right and remedy granted to them for default under the
terms of the Security Documents and the other Loan Documents.
9.3 Other Remedies. If any Event of Default or Default shall occur and
be continuing, the holder of any Note may proceed to protect and enforce its
rights under this Agreement and such Note by exercising such remedies as are
available to such holder in respect thereof under applicable law, either by suit
in equity or by action at law, or both, whether for specific performance of any
covenant or other agreement contained in this Agreement or in aid of the
exercise of any power granted in this Agreement. No remedy conferred in this
Agreement upon the holder of any Note is intended to be exclusive of any other
remedy, and each and every such remedy shall be cumulative and shall be in
addition to every other remedy conferred herein or now or hereafter existing at
law or in equity or by statute or otherwise.
ARTICLE X
LOAN OPERATIONS
10.1 Interests in Loans/Commitments. The percentage interest of each
Bank in the Loans and Letters of Credit, and the Commitments, shall be computed
based on the maximum principal amount for each Bank as follows:
Maximum Maximum Working Maximum
Acquisition Capital Commitments Percentage
Bank Loan Commitments Loan Commitments Amount Interest
-------------- ---------------- ---------------- ----------- ----------
BOk $12,000,000 $ 8,000,000 $20,000,000 40.00%
Mercantile $ 9,000,000 $ 6,000,000 $15,000,000 30.00%
Local $ 9,000,000 $ 6,000,000 $15,000,000 30.00%
----------- ----------- ----------- -----
Total $30,000,000 $20,000,000 $50,000,000 100.00%
=========== =========== =========== ======
The foregoing percentage interests, as from time to time in effect and reflected
in the Register, are referred to as the "Percentage Interests" with respect to
all or any portion of the Loans and Letters of Credit, and the Commitments.
10.2 Administrative Agent's Authority to Act. Each of the Banks
appoints and authorizes BOk to act for the Banks as Administrative Agent in
connection with the transactions contemplated by this Agreement and the other
Loan Documents on the terms set forth herein. In acting hereunder, such
Administrative Agent is acting for the account of BOk to the extent of its
Percentage Interest and for the account of each other Bank to the extent of such
Bank's Percentage Interest, and all action in connection with the enforcement
of, or the exercise of any remedies (other than the Banks' rights of set-off as
provided herein or in any other Loan Document) in respect of the Loans and the
Indebtedness shall be taken by such Administrative Agent.
10.3 Borrower to Pay Administrative Agent. The Borrower shall be fully
protected in making all payments in respect of the Notes evidencing the Credit
Obligations to the Administrative Agent, in relying upon consents, modifications
and amendments executed by such Administrative Agent purportedly on the Banks'
behalf, and in dealing with such Administrative Agent as herein provided. Upon
three (3) Business Days notice, such Administrative Agent may charge the
accounts of the Borrower, on the dates when the amounts thereof become due and
payable, with the amounts of the principal of and interest on the Loans,
including any amounts paid by such Administrative Agent to third parties under
Letters of Credit or drafts presented thereunder, commitment fees, Letter
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of Credit issuance fees and processing/application fees pertaining thereto and
all other fees and amounts owing under any Loan Document.
10.4 Bank Operations for Advances, Letters of Credit.
10.4.1 Advances. On the funding date for each Loan, each Bank
shall advance to the Administrative Agent in immediately available
funds such Bank's Percentage Interest in the portion of a Loan advanced
on such funding date prior to 12:00 noon (Tulsa, Oklahoma time). If
such funds are not received at such time, but all applicable conditions
set forth in Article VI have been satisfied, each Bank authorizes and
requests such Administrative Agent to advance for the Bank's account,
pursuant to the terms hereof, the Bank's respective Percentage Interest
in such portion of such Loan and agrees to reimburse such
Administrative Agent in immediately available funds for the amount
thereof prior to 3:00 p.m. (Tulsa, Oklahoma time) on the day any
portion of such Loan is advanced hereunder; provided, however, that
such Administrative Agent is not authorized to make any such advance
for the account of any Bank who has previously notified the
Administrative Agent in writing that such Bank will not be performing
its obligations to make further advances hereunder; and provided,
further, that such Administrative Agent shall be under no obligation to
make any such advance.
10.4.2 Letters of Credit. Each of the Banks authorizes and
requests each Letter of Credit Issuer to issue the Letters of Credit
provided for in Section 2.3 and agrees to purchase a participation in
each of such Letters of Credit in an amount equal to its Percentage
Interest in the amount of each such Letter of Credit. Promptly upon the
request of any Letter of Credit Issuer, each Bank shall reimburse such
Letter of Credit Issuer in immediately available funds for such Bank's
Percentage Interest in the amount of all obligations to third parties
incurred by the Letter of Credit Issuer in respect of each Letter of
Credit and each draft accepted under a Letter of Credit to the extent
not timely reimbursed by the Borrower. Each Letter of Credit Issuer
will notify each Bank (and the Administrative Agent if the
Administrative Agent is not the Letter of Credit Issuer) of the
issuance of each Letter of Credit, the amount and date of payment of
any draft drawn or accepted under a Letter of Credit and whether in
connection with the payment of any such draft the amount thereof was
added to the Working Capital Loan or was reimbursed by the Borrower.
10.4.3 Administrative Agent to Allocate Payments. All payments
of principal and interest in respect of the extensions of credit made
pursuant to this Agreement, reimbursement of amounts paid by each
Letter of Credit Issuer to third parties under Letters of Credit or
drafts presented thereunder, commitment fees, Letter of Credit issuance
fees and other fees under this Agreement (except for the standard
Letter of Credit application/processing fees of any Letter of Credit
Issuer and any fees due to the Administrative Agent), which shall not
be shared by the Banks shall, as a matter of convenience, be made by
the Borrower to the applicable Letter of Credit Issuer or the
applicable Agent, as the case may be. The share of each Bank shall be
credited to such Bank by the Administrative Agent, in immediately
available funds in such manner that the principal amount of the Loans
constituting Credit Obligations to be paid shall be paid
proportionately in accordance with the Banks' respective Percentage
Interests in such Loans, except as otherwise provided in this
Agreement. Under no circumstances shall any Bank be required to produce
or present its Notes as evidence of its interests in the Loans
constituting Credit Obligations in any action or proceeding relating to
the Loans constituting Credit Obligations.
10.4.4 Delinquent Banks; Nonperforming Banks. In the event
that any Bank fails to reimburse the Administrative Agent, pursuant to
Section 10.4.1 for the Percentage Interest of such Bank (a "Delinquent
Bank") in any credit advanced by such Administrative Agent pursuant
hereto, overdue amounts (the "Delinquent Payment") due from the
Delinquent Bank to such Administrative Agent shall bear interest,
payable by the Delinquent Bank on demand, at a per annum rate equal to
(a) the Federal Funds Rate for the first three days overdue and (b) the
sum of two percentage points (2%) plus the Federal Funds Rate for any
longer period. Such interest shall be payable to such Administrative
Agent for its own account for the period commencing on the date of the
Delinquent Payment and ending on the date the Delinquent Bank
reimburses such Administrative Agent on account of the Delinquent
Payment (to the extent not paid by the Borrower as provided below) and
the accrued interest thereon (the "Delinquency Period"), whether
pursuant to the assignments referred to below or otherwise. Upon notice
by such
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Administrative Agent, the Borrower will pay to such Administrative
Agent the principal (but not the interest) portion of the Delinquent
Payment. During the Delinquency Period, in order to make reimbursements
for the Delinquent Payment and accrued interest thereon, the Delinquent
Bank shall be deemed to have assigned to such Administrative Agent all
interest, commitment fees and other payments made by the Borrower under
Articles II, III and IV hereof that would have thereafter otherwise
been payable under the Loan Documents to the Delinquent Bank. During
any other period in which any Bank is not performing its obligations to
extend credit under Article II hereof (a "Nonperforming Bank"), the
Nonperforming Bank shall be deemed to have assigned to each Bank that
is not a Nonperforming Bank (a "Performing Bank") such Performing
Banks' respective Percentage Interest in all principal and other
payments made by the Borrower that would have thereafter otherwise been
payable thereunder to the Nonperforming Bank. Such Administrative Agent
shall credit a portion of such payments to each Performing Bank in an
amount equal to the Percentage Interest of such Performing Bank in an
amount equal to the Percentage Interest of such Performing Bank divided
by one minus the Percentage Interest of the Nonperforming Bank until
the respective portions of the Loans owed to all the Banks are the same
as the Percentage Interests of the Banks immediately prior to the
failure of the Nonperforming Bank to perform its obligations under
Article II hereof. The foregoing provisions shall be in addition to any
other remedies the Administrative Agent, the Performing Banks or the
Borrower may have under law or equity against the Delinquent Bank as a
result of the Delinquent Payment or against the Nonperforming Bank as a
result of its failure to perform its obligations under Article II
hereof.
10.5 Sharing of Payments. To the extent permitted by applicable Bank
Legal Requirements and subject to the provisions of the Intercreditor Agreement,
each Bank agrees that (i) if by exercising any right of set-off or counterclaim
or otherwise, it shall receive payment of (a) a proportion of the aggregate
amount due with respect to its Percentage Interest in the Loans and Letter of
Credit Exposure which is greater than (b) the proportion received by any other
Bank in respect of the aggregate amount due with respect to such other Bank's
Percentage Interest in the Loans and Letter of Credit Exposure and (ii) if such
inequality shall continue for more than 10 days, the Bank receiving such
proportionately greater payment shall purchase participations in the Percentage
Interests in the Loans and Letter of Credit Exposure held by the other Banks,
and such other adjustments shall be made from time to time (including rescission
of such purchases of participations in the event the unequal payment originally
received is recovered from such Bank through bankruptcy proceedings or
otherwise), as may be required so that all such payments of principal and
interest with respect to the Loans and Letter of Credit Exposure held by the
Banks shall be shared by the Banks pro rata in accordance with their respective
Percentage Interests; provided, however, that this Section 10.5 shall not impair
the right of any Bank to exercise any right of set-off or counterclaim it may
have and to apply the amount subject to such exercise to the payment of
Indebtedness of Borrower other than Borrower's Indebtedness with respect to the
Loans and Letter of Credit Exposure. Each Bank that grants a participation in
the Loans and Commitments to a Credit Participant shall require as a condition
to the granting of such participation that such Participant agree to share
payments received in respect of the Indebtedness as provided in this Section
10.5. The provisions of this Section 10.5 are for the sole and exclusive benefit
of the Banks and no failure of any Bank to comply with the terms hereof shall be
available to either Borrower as a defense to the payment of the Loans.
10.6 Amendments, Consents, Waivers. Except as otherwise set forth
herein, the Administrative Agent may (and upon the written request of the
Required Banks the Administrative Agent shall) take or refrain from taking any
action under this Agreement or any other Loan Document, including giving its
written consent to any modification of or amendment to and waiving in writing
compliance with any covenant or condition in this Agreement or any other Loan
Document or any Default or Event of Default, all of which actions shall be
binding upon all of the Banks; provided, however, that:
(i) Without the written consent of the Banks owning at least two thirds
(2/3) of the Percentage Interests (other than Delinquent Banks during the
existence of a Delinquency Period so long as such Delinquent Bank is treated the
same as the other Banks with respect to any actions enumerated below), no
written modification of, amendment to, consent with respect to, waiver of
compliance with or waiver of a Default under, any of the Loan Documents shall be
made, including without limitation, Sections 7B.1 through 7B.15 of this
Agreement, the related defined terms or this Section 10.6(a) shall be made.
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(ii) Without the written consent of such Banks as own 100% of the
Percentage Interests (other than Delinquent Banks during the existence of a
Delinquency Period so long as such Delinquent Bank is treated the same as the
other Banks with respect to any actions enumerated below):
(a) No reduction shall be made in (A) the amount of principal
of any of the Loans or reimbursement obligations for payments made
under Letters of Credit, (B) the interest rate on the Loans or (C) the
Letter of Credit issuance fees (excluding, however, Letter of Credit
processing/application fees, the amount of which shall be within the
sole discretion of each Letter of Credit Issuer) or commitment
(non-usage) fees.
(b) No change shall be made in the stated time of payment of
all or any portion of any of the Loans or interest thereon or
reimbursement of payments made under Letters of Credit or fees relating
to any of the foregoing payable to all of the Banks and no waiver shall
be made of any Default under Section 9.1(i) and (ii) hereof.
(c) No increase shall be made in the amount, or extension of
the term, of either Commitment beyond that provided for under Article
II.
(d) Except as otherwise provided in the Intercreditor
Agreement, no alteration shall be made of the Banks' rights of set-off
contained herein or in the other Loan Documents.
(e) Except as otherwise provided in the Intercreditor
Agreement, no release of any Collateral shall be made (except that the
Collateral Agent may release particular items of Collateral in
dispositions permitted by the Security Documents in accordance with the
terms and provisions of the Intercreditor Agreement and may release all
Collateral upon payment in full of the Loans evidenced by the Notes and
termination of the Commitments together with payment of all of the
Private Placement Notes and Parity Debt without the written consent of
the Banks).
(f) No amendment to or modification of this Section 10.6(ii)
shall be made.
10.7 Administrative Agent's Resignation. The Administrative Agent may
resign at any time by giving at least 30 days' prior written notice of its
intention to do so to each other of the Banks and the Borrower and upon the
appointment by the Required Banks of a successor Administrative Agent
satisfactory to the Borrower. If no successor Administrative Agent shall have
been so appointed and shall have accepted such appointment within 45 days after
the retiring Administrative Agent's giving of such notice of resignation, then
the retiring Administrative Agent may with the consent of the Borrower, which
shall not be unreasonably withheld, appoint a successor Administrative Agent
which shall be a bank or a trust company organized under the laws of the United
States of America or any state thereof and having a combined capital, surplus
and undivided profit of at least $50,000,000; provided, however, that any
successor Administrative Agent appointed under this sentence may be removed upon
the written request of the Required Banks, which request shall also appoint a
successor Administrative Agent satisfactory to the Borrower. Upon the
appointment of a new Administrative Agent hereunder, the term "Administrative
Agent" shall for all purposes of this Agreement thereafter mean such successor.
After any retiring Administrative Agent's resignation hereunder as an
Administrative Agent, or the removal hereunder of any successor Administrative
Agent, the provisions of this Agreement shall continue to inure to the benefit
of such Administrative Agent as to any actions taken or omitted to be taken by
it while it was an Administrative Agent under this Agreement.
10.8 Concerning the Agents.
10.8.1 Action in Good Faith. The Agents and their respective
officers, directors, employees and agents shall be under no liability
to any of the Banks or to any future holder of any interest in the
Indebtedness for any action or failure to act taken or suffered in good
faith, and any action or failure to act in accordance with an opinion
of its counsel shall conclusively be deemed to be in good faith. The
Agents shall in all cases be entitled to rely, and shall be fully
protected in relying, on instructions given to the Agents by the
Required Holders of the Notes evidencing the Indebtedness as provided
in this Agreement.
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10.8.2 No Implied Duties. The Agents shall have and may
exercise such powers as are specifically delegated to the Agents under
this Agreement or any other Loan Document together with all other
powers incidental thereto. The Agents shall have no implied duties to
any Person or any obligation to take any action under this Agreement or
any other Loan Document except for action specifically provided for in
this Agreement or any other Loan Document to be taken by the Agents.
Before taking any action under this Agreement or any other Loan
Document, the Agents may request an appropriate specific indemnity
satisfactory to it from each Bank in addition to the general indemnity
provided for in Section 10.11. Until the Agents have received such
specific indemnity, the Agents shall not be obligated to take (although
such Agent may in its sole discretion take) any such action under this
Agreement or any other Loan Document. Each Bank confirms that the
Agents do not have a fiduciary relationship to them under the Loan
Documents. The Borrower and its Subsidiaries party hereto confirm that
neither the Agents nor any other Bank has a fiduciary relationship to
them under the Loan Documents.
10.8.3 Validity. The Agents shall not be responsible to any
Bank or any future holder of any interest in the Loans and Indebtedness
(a) for the legality, validity, enforceability or effectiveness of this
Agreement or any other Loan Document, (b) for any recitals, reports,
representations, warranties or statements contained in or made in
connection with this Agreement or any other Loan Document, (c) for the
existence or value of any assets included in any security for the Loans
and Indebtedness, (d) for the effectiveness of any Lien purported to be
included in the Collateral, (e) for the specification or failure to
specify any particular assets to be included in the Collateral, or (f)
unless the Agents shall have failed to comply with Section 10.8.1, for
the perfection of the security interests in the Collateral.
10.8.4 Compliance. The Agents shall not be obligated to
ascertain or inquire as to the performance or observance of any of the
terms of this Agreement or any other Loan Document; and in connection
with any extension of credit under this Agreement or any other Loan
Document, the Agents shall be fully protected in relying on a
certificates of the Borrower as to the fulfillment by the Borrower of
any conditions to such extension of credit.
10.8.5 Employment Agents and Counsel. The Agents may execute
any of their respective duties as Agents under this Agreement or any
other Loan Document by or through employees, agents and
attorneys-in-fact and shall not be responsible to any of the Banks, the
Borrower for the default or misconduct of any such Agents or
attorneys-in-fact selected by the Agent acting in good faith. The
Agents shall be entitled to advice of counsel concerning all matters
pertaining to the agency hereby created and its duties hereunder or
under any other Loan Document.
10.8.6 Reliance on Documents and Counsel. The Agents shall be
entitled to rely, and shall be fully protected in relying, upon any
affidavit, certificate, cablegram, consent, instrument, letter, notice,
order, document, statement, telecopy, telegram, telex or teletype
message or writing reasonably believed in good faith by the Agents to
be genuine and correct and to have been signed, sent or made by the
Person in question, including any telephonic or oral statement made by
such Person, and, with respect to legal matters, upon an opinion or the
advice of counsel selected by such Agent.
10.8.7 Agents' Reimbursement. Each of the Banks severally
agrees to reimburse the Agents, in the amount of such Bank's Percentage
Interest, for any reasonable expenses not reimbursed by the Borrower
(without limiting the obligation of the Borrower to make such
reimbursement): (a) for which the Agents are entitled to reimbursement
by the Borrower under this Agreement or any other Loan Document, and
(b) after the occurrence of a Default, for any other reasonable
expenses incurred by the Agents on the Banks' behalf in connection with
the enforcement of the Banks' rights under this Agreement or any other
Loan Document.
10.9 Rights as a Bank. With respect to any Loan(s) or advance(s)
extended by it hereunder, each of the Agents shall have the same rights,
obligations and powers hereunder as any other Bank and may exercise such rights
and powers as though it were not an Agent, and unless the context otherwise
specifies, the Agents shall be treated in their respective individual capacities
as though they were not the Agents hereunder. Without limiting the generality
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of the foregoing, the Percentage Interest of each Agent shall be included in any
computations of Percentage Interests. Each Agent and its Affiliates may accept
deposits from, lend money to, act as trustee for and generally engage in any
kind of banking or trust business with the Borrower, any of its Subsidiaries or
any Affiliate of any of them and any Person who may do business with or own an
equity interest in the Borrower, any of its Subsidiaries or any Affiliate of any
of them, all as if such Agent were not one of the Agents and without any duty to
account therefor to the other Banks.
10.10 Independent Credit Decision. Each of the Banks acknowledges that
it has independently and without reliance upon either of the Agents, based on
the financial statements and other documents referred to in Section 8.4, on the
other representations and warranties contained herein and on such other
information with respect to the Borrower and its Subsidiaries as such Bank
deemed appropriate, made such Bank's own credit analysis and decision to enter
into this Agreement and to make the extensions of credit provided for hereunder.
Each Bank represents to the Agents that such Bank will continue to make its own
independent credit and other decisions in taking or not taking action under this
Agreement or any other Loan Document. Each Bank expressly acknowledges that
neither the Agents nor any of their respective officers, directors, employees,
Agents, attorneys-in-fact or Affiliates has made any representations or
warranties to such Bank, and no act by either of the Agents taken under this
Agreement or any other Loan Document, including any review of the affairs of the
Borrower and its Subsidiaries, shall be deemed to constitute any representation
or warranty by either of the Agents. Except for notices, reports and other
documents expressly required to be furnished to each Bank by the Administrative
Agent under this Agreement or any other Loan Document, the Agents shall not have
any duty or responsibility to provide any Bank with any credit or other
information concerning the business, operations, property, condition, financial
or otherwise, or creditworthiness of the Borrower or any Subsidiary which may
come into the possession of either of the Agents or any of their respective
officers, directors, employees, agents, attorneys-in-fact or Affiliates.
10.11 Indemnification. The holders of the Indebtedness shall indemnify
the Agents and their respective officers, directors, employees and Agents (to
the extent not reimbursed by the Borrower and without limiting the obligation of
the Borrower to do so), pro rata in accordance with their respective Percentage
Interests, from and against any and all liabilities, obligations, losses,
damages, penalties, actions, judgments, suits, costs, expenses or disbursements
of any kind whatsoever which may at any time be imposed on, incurred by or
asserted against either of the Agents or such Persons relating to or arising out
of this Agreement, any other Loan Document, the transactions contemplated hereby
or thereby, or any action taken or omitted by either of the Agents in connection
with any of the foregoing; provided, however, that the foregoing shall not
extend to actions or omissions which are taken by either or both of the Agents
with gross negligence or willful misconduct.
ARTICLE XI
ASSIGNMENTS/PARTICIPATIONS
11. Successors and Assigns; Bank Assignment and Participations. Any
reference in this Agreement to any party hereto shall be deemed to include the
successors and assigns of such party, and all covenants and agreements by or on
behalf of the Borrower, the Agents or the Banks that are contained in this
Agreement or any other Loan Documents shall bind and inure to the benefit of
their respective successors and assigns; provided, however, that (a) the
Borrower may not assign its rights or obligations under this Agreement except
for mergers or liquidations permitted by Section 7B.7, and (b) the Banks shall
be not entitled to assign their respective Percentage Interests in the Loans
evidenced by the Notes hereunder except as set forth below in this Section 11.
11.1 Assignments by Banks.
11.1.1 Assignees and Assignment Procedures. Each Bank may (i)
without the consent of the Agents or the Borrower if the proposed
assignee is already a Bank hereunder or a Wholly Owned Subsidiary of
the same corporate parent of which the assigning Bank is a Subsidiary,
or (ii) otherwise with the consents of the Agents and (so long as no
Event of Default exists) the Borrower (which consents will not be
unreasonably withheld), in compliance with applicable laws in
connection with such assignment, assign to one or more commercial banks
or other financial institutions (each, an "Assignee") all or a portion
of its interests, rights and obligations under this Agreement and the
other Loan Documents, including all or
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a portion, which need not be pro rata among the Loans and the Letter of
Credit Exposure, of its Commitments, the portion of the Loans and
Letter of Credit Exposure at the time owing to it and the Notes held by
it, but excluding its rights and obligations as one of the Agents;
provided, however, that:
(i) the aggregate amount of the Commitments of the assigning
Bank subject to each such assignment to any Assignee other than another
Bank (determined as of the date the Assignment and Acceptance with
respect to such assignment is delivered to the Administrative Agent)
shall be not less than $1,000,000 and in increments of $500,000; and
(ii) the parties to each such assignment shall execute and
deliver to the Administrative Agent an Assignment and Acceptance (the
"Assignment and Acceptance") in the form satisfactory to the
Administrative Agent and the Collateral Agent, together with the Note
or Notes subject to such assignment and a processing and recordation
fee of $500 payable to the Administrative Agent by the assigning Bank
or the Assignee.
Upon acceptance and recording pursuant to Section 11.1.4, from
and after the effective date specified in each Assignment and
Acceptance (which effective date shall be at least five (5) Banking
Days after the execution thereof unless waived in writing by the
Administrative Agent):
(A) the Assignee shall be a party hereto and, to the
extent provided in such Assignment and Acceptance,
have the rights and obligations of a Bank under this
Agreement; and
(B) the assigning Bank shall, to the extent provided in
such assignment, be released from its obligations
under this Agreement (and, in the case of an
Assignment and Acceptance covering all or the
remaining portion of an assigning Bank's rights and
obligations under this Agreement, such Bank shall
cease to be a party hereto but shall continue to be
entitled to the benefits of the Applicable Rate
provisions hereof, as well as to any fees accrued for
its account hereunder and not yet paid).
11.1.2 Terms of Assignment and Acceptance. By executing and
delivering an Assignment and Acceptance, the assigning Bank and
Assignee shall be deemed to confirm to and agree with each other and
the other parties hereto as follows:
(a) other than the representation and warranty that it is the
legal and beneficial owner of the interest being assigned thereby free
and clear of any adverse claim, such assigning Bank makes no
representation or warranty and assumes no responsibility with respect
to any statements, warranties or representations made in or in
connection with this Agreement or the execution, legality, validity,
enforceability, genuineness, sufficiency or value of this Agreement,
any other Loan Document or any other instrument or document furnished
pursuant hereto;
(b) such assigning Bank makes no representation or warranty
and assumes no responsibility with respect to the financial condition
of the Borrower and its Subsidiaries or the performance or observance
by the Borrower or any of its Subsidiaries of any of its obligations
under this Agreement, any other Loan Document or any other instrument
or document furnished pursuant hereto;
(c) such Assignee confirms that it has received a copy of this
Agreement, together with copies of the most recent quarterly or annual
financial statements delivered pursuant to Section 7A.1 and such other
documents and information as it has deemed appropriate to make its own
credit analysis and decision to enter into such Assignment and
Acceptance;
(d) such Assignee will independently and without reliance upon
the Administrative Agent, such assigning Bank or any other Bank, and
based on such documents and information as it shall deem appropriate at
the time, continue to make its own credit decisions in taking or not
taking action under this Agreement;
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(e) such Assignee appoints and authorizes the Administrative
Agent to take such action as the Administrative Agent on its behalf and
to exercise such powers under this Agreement as are delegated to the
Administrative Agent by the terms hereof, together with such powers as
are reasonably incidental thereto; and
(f) such Assignee agrees that it will perform in accordance
with the terms of this Agreement all the obligations which are required
to be performed by it as a Bank.
11.1.3 Register. The Administrative Agent, shall maintain at
its main Tulsa, Oklahoma, banking office a register (the "Register")
for the recordation of (a) the names and addresses of the Banks and the
Assignees which assume rights and obligations pursuant to an assignment
under Section 11.1.1, (b) the Percentage Interest of each such Bank as
set forth in Section 11.1 and (c) the amount of the Loans and Letter of
Credit Exposure owing to each Bank from time to time. The entries in
the Register shall be conclusive, in the absence of manifest error, and
the Borrower, BOK, as such Administrative Agent and the Banks may treat
each Person whose name is registered therein for all purposes as a
party to this Agreement. The Register shall be available for inspection
by the Borrower or any Bank at any reasonable time and from time to
time upon reasonable prior notice.
11.1.4 Acceptance of Assignment and Assumption. Upon its
receipt of a completed Assignment and Acceptance executed by an
assigning Bank and an Assignee, in exchange for the Notes subject to
such assignment, together with the Note or Notes subject to such
assignment, and the processing and recordation fee referred to in
Section 11.1.1, the Administrative Agent shall (a) accept such
Assignment and Acceptance, (b) record the information contained therein
in the Register and (c) give prompt notice thereof to the Borrower.
Within five (5) Business Days after receipt of notice, the Borrower, at
its own expense, shall execute and deliver to the Administrative Agent,
in exchange for the surrendered Note or Notes, a new Note or Notes to
the order of such Assignee in a principal amount equal to the
applicable Commitments and Loans assumed by it pursuant to such
Assignment and Acceptance and, if the assigning Bank has retained
Commitments and Loans, a new Note or Notes to the order of such
assigning Bank in a principal amount equal to the applicable
Commitments and its Percentage Interest in the Loans retained by it.
Such new Note or Notes shall be in an aggregate principal amount equal
to the aggregate principal amount of such surrendered Note or Notes,
and shall be dated the date of the surrendered Note or Notes which it
or they replace. All such Notes so replaced shall be delivered by the
Administrative Agent to the Borrower or, alternatively, at such
Administrative Agent's election, marked appropriately to evidence the
replacement thereof by such replacement Note(s).
11.1.5 Federal Reserve Bank. Notwithstanding the foregoing
provisions of this Section 11, any Bank may at any time pledge or
assign all or any portion of such Bank's rights under this Agreement
and the other Loan Documents to a Federal Reserve Bank; provided,
however, that no such pledge or assignment shall release such Bank from
such Bank's obligations hereunder or under any other Loan Document.
11.1.6 Further Assurances. The Borrower and its Subsidiaries
shall sign such documents and take such other actions from time to time
reasonably requested by an Assignee to enable it to share in the
benefits of the rights created by the Loan Documents.
11.2 Credit Participants. Each Bank may, without the consent of the
Borrower and with the consent of the Administrative Agent, in compliance with
applicable laws in connection with such participation, sell to one or more
commercial banks or other financial institutions (each a "Credit Participant")
participations in all or a portion of its interests, rights and obligations
under this Agreement and the other Loan Documents (including all or a portion of
its Commitments, the Loans and Letter of Credit exposure owing to it and the
Notes held by it); provided, however, that:
(i) such Bank's obligations under this Agreement shall remain
unchanged;
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(ii) such Bank shall remain solely responsible to the other parties
hereto for the performance of such obligations;
(iii) the Credit Participant shall be entitled to the benefit of any
cost protection provisions contained in the Credit Agreement, but shall not be
entitled to receive any greater payment thereunder than the selling Bank would
have been entitled to receive with respect to the interest so sold if such
interest had not been sold; and
(iv) the Borrower, the Administrative Agent and the other Banks shall
continue to deal solely and directly with such Bank in connection with such
Bank's rights and obligations under this Agreement, and such Bank shall retain
the sole right as one of the Banks to vote with respect to the enforcement of
the obligations of the Borrower relating to the Loans and Letter of Credit
Exposure and the approval of any amendment, modification or waiver of any
provision of this Agreement (other than amendments, modifications, consents or
waivers described in Section 10.6(ii)).
Borrower agrees, to the fullest extent permitted by applicable law, that any
Credit Participant and any Bank purchasing a participation from another Bank
pursuant to Section 11.1 may exercise all rights of payment (including the right
of set-off), with respect to its participation as fully as if such Credit
Participant or such Bank were the direct creditor of the Borrower and a Bank
hereunder in the amount of such participation. Upon receipt of notice of the
address of each Credit Participant, the Borrower shall thereafter supply such
Credit Participants with the same information and reports communicated to the
Banks. The Borrower hereby acknowledges and agrees that Credit Participants
shall be deemed a holder of the applicable Notes to the extent of their
respective participation, and the Borrower hereby waives its right, if any, to
offset amounts owing to the Borrower from the Banks against each Credit
Participant's portion of the applicable Notes.
11.3 Replacement of Bank. In the event that any Bank or, to the extent
applicable, any Credit Participant (the "Affected Bank"):
(a) fails to perform its obligations to fund any portion of
the Loans or to issue any Letter of Credit when required to do so by
the terms of the Loan Documents, or fails to provide its portion of any
Eurodollar Pricing Option pursuant to Section 3.2.1 or on account of a
Bank Legal Requirement as contemplated by Section 3.2.5;
(b) demands payment under the Reserve provisions of Section
3.5, the Tax provisions of Section 3.6, the Capital Adequacy provisions
of Section 3.7 or the Regulatory Change provisions in Section 3.8 in an
amount the Borrower deems materially in excess of the amounts with
respect thereto demanded by the other Banks; or
(c) refuses to consent to a proposed amendment, modification,
waiver or other action requiring consent of the holders of 100% of the
Percentage Interests under Section 10.6(ii) that is consented to by the
other Banks;
then, so long as no Event of Default exists, the Borrower shall have the right
to seek a replacement Bank which is reasonably satisfactory to the
Administrative Agent (the "Replacement Bank"). The Replacement Bank shall
purchase the interests of the Affected Bank in the Loans, Letters of Credit and
its Commitments and shall assume the obligations of the Affected Bank hereunder
and under the other Loan Documents upon execution by the Replacement Bank of an
Assignment and Acceptance and the tender by it to the Affected Bank of a
purchase price agreed between it and the Affected Bank (or, if they are unable
to agree, a purchase price in the amount of the Affected Bank's Percentage
Interest in the Loans and Letter of Credit Exposure, or appropriate credit
support for contingent amounts included therein, and all other outstanding
Credit Obligations then owed to the Affected Bank). Such assignment by the
Affected Bank shall be deemed an early termination of any Eurodollar Pricing
Option to the extent of the Affected Bank's portion thereof, and the Borrower
will pay to the Affected Bank any resulting amounts due under Section 3.2.4.
Upon consummation of such assignment, the Replacement Bank shall become party to
this Agreement as a signatory hereto and shall have all the rights and
obligations of the Affected Bank under this Agreement and the other Loan
Documents with a Percentage Interest equal to the Percentage Interest of the
Affected Bank, the Affected Bank shall be released from its obligations
hereunder and under the Loan Documents,
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and no further consent or action by any party shall be required. Upon the
consummation of such assignment, the Borrower, the Administrative Agent and the
Affected Bank shall make appropriate arrangements so that a new Note or Notes
are issued to the Replacement Bank. The Borrower shall sign such documents and
take such other actions reasonably requested by the Replacement Bank to enable
it to share in the benefits of the rights created by the Loan Documents. Until
the consummation of an assignment in accordance with the foregoing provisions of
this Section 11.3, the Borrower shall continue to pay the Affected Bank any Loan
Obligations as they become due and payable.
11.4 Sale of a Certain Participation. The Borrower, the Agents and the
Banks recognize and acknowledge that the BOk is selling a participating interest
in its Notes to Stillwater National Bank and Trust Company.
ARTICLE XII
MISCELLANEOUS
12.1 Notices. Unless otherwise provided herein, all notices, requests,
consents and demands shall be in writing and shall be either hand-delivered (by
courier or otherwise) or mailed by certified mail, postage prepaid, or sent by
facsimile transmission (confirmed as aforesaid) to the respective addresses
specified below, or, as to any party, to such other address as may be designated
by it in notice to the other parties in accordance with this Section 12.1:
If to the Borrower, to:
Heritage Operating, L.P.
0000 Xxxxx Xxxx Xxxxxx, Xxxxx 000
Xxxxx, Xxxxxxxx 00000
Attention: Chief Financial Officer
FAX: (000) 000-0000
If to the Banks, to:
Bank of Oklahoma, National Association
P. O. Box 2300
Bank of Oklahoma Tower
Xxx Xxxxxxxx Xxxxxx
Xxxxx, Xxxxxxxx 00000
Attention: Corporate Department - 8th Floor
FAX: (000) 000-0000
The Administrative Agent, is hereby designated and appointed and shall serve as
notice agent for all of the Banks insofar as notices hereunder are concerned and
notice to the Administrative Agent shall be deemed notice to each of the Banks
with the same force and effect as if each such Bank were individually notified
in accordance herewith. All notices, requests, consents and demands hereunder
will be effective when hand-delivered to the applicable notice address set forth
above or when mailed by certified mail, postage prepaid, addressed as aforesaid.
12.2 Place of Payment. All sums payable hereunder shall be paid in
immediately available funds to the Administrative Agent, at its Tulsa, Oklahoma
main banking offices, or at such other place as such Administrative Agent shall
notify the Borrower in writing. If any interest, principal or other payment
falls due on a date other than a Business Day, then (unless otherwise provided
herein) such due date shall be extended to the next succeeding Business Day, and
such extension of time will in such case be included in computing interest, if
any, in connection with such payment.
12.3 Survival of Agreements. All covenants, agreements, representations
and warranties made herein shall survive the execution and the delivery of Loan
Documents. All statements contained in any certificate or other
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instrument delivered by the Borrower hereunder shall be deemed to constitute
representations and warranties by the Borrower.
12.4 Parties in Interest. All covenants, agreements and obligations
contained in this Agreement shall bind and inure to the benefit of the
respective successors and assigns of the parties hereto, except that the
Borrower may not assign their rights or obligations hereunder without the prior
written consent of the Banks.
12.5 Governing Law and Jurisdiction. This Agreement and the Notes shall
be deemed to have been made or incurred and delivered under the laws of the
State of Oklahoma and shall be construed and enforced in accordance with and
governed by the Laws of Oklahoma.
12.6 SUBMISSION TO JURISDICTION. THE BORROWER HEREBY CONSENTS TO THE
JURISDICTION OF ANY OF THE LOCAL, STATE, AND FEDERAL COURTS LOCATED WITHIN TULSA
COUNTY, OKLAHOMA AND WAIVES ANY OBJECTION WHICH BORROWER MAY HAVE BASED ON
IMPROPER VENUE OR FORUM NON CONVENIENS TO THE CONDUCT OF ANY PROCEEDING IN ANY
SUCH COURT AND WAIVES PERSONAL SERVICE OF ANY AND ALL PROCESS UPON ANY OF THEM,
AND CONSENTS THAT ALL SUCH SERVICE OF PROCESS BE MADE BY MAIL OR MESSENGER
DIRECTED TO ANY OF THEM AT THE ADDRESS SET FORTH IN SUBSECTION 12.1 HEREOF AND
THAT SERVICE SO MADE SHALL BE DEEMED TO BE COMPLETED UPON THE EARLIER OF ACTUAL
RECEIPT OR THREE (3) BUSINESS DAYS AFTER MAILED OR DELIVERED BY MESSENGER.
12.7 Maximum Interest Rate. Regardless of any provision herein, the
Banks shall never be entitled to receive, collect or apply, as interest on the
Indebtedness any amount in excess of the maximum rate of interest permitted to
be charged by the Banks by applicable Law, and, in the event the Banks shall
ever receive, collect or apply, as interest, any such excess, such amount which
would be excessive interest shall be applied to other Indebtedness and then to
the reduction of principal; and, if all other Indebtedness and principal are
paid in full, then any remaining excess shall forthwith be paid to the Borrower.
12.8 No Waiver; Cumulative Remedies. No failure to exercise, and no
delay in exercising, on the part of the Banks, any right, power or privilege
hereunder or under any other Loan Document or applicable Law shall preclude any
other or further exercise thereof or the exercise of any other right, power or
privilege of the Banks. The rights and remedies herein provided are cumulative
and not exclusive of any other rights or remedies provided by any other
instrument or by law. No amendment, modification or waiver of any provision of
this Agreement or any other Loan Document shall be effective unless the same
shall be in writing and signed by the Banks. No notice to or demand on the
Borrower in any case shall entitle the Borrower to any other or further notice
or demand in similar or other circumstances.
12.9 Costs. The Borrower agrees to pay to the Banks on demand all
reasonable costs, fees and expenses (including without limitation reasonable
attorneys fees and legal expenses) incurred or accrued by the Banks in
connection with the negotiation, preparation, execution, delivery, filing,
recording, facilitation and administration of this Agreement, the Notes, the
Security Documents, the Intercreditor Agreement and the other Loan Documents, or
any amendment, waiver, consent or modification thereto or thereof, or any
enforcement thereof. The Borrower further agrees that the fees and expenses of
the Banks, including the Agents, incurred in connection with the negotiation and
preparation of this Agreement and the other Loan Documents shall be paid
regardless of whether or not the transactions provided for in this Agreement are
eventually closed and regardless of whether or not any or all sums evidenced by
the Notes are advanced to the Borrower by the Banks.
12.10 WAIVER OF JURY. BORROWER FULLY, VOLUNTARILY AND EXPRESSLY WAIVES
ANY RIGHT TO A TRIAL BY JURY IN ANY ACTION OR PROCEEDING TO ENFORCE OR DEFEND
ANY RIGHTS UNDER THIS AGREEMENT OR UNDER ANY AMENDMENT, INSTRUMENT, DOCUMENT OR
AGREEMENT DELIVERED (OR WHICH MAY IN THE FUTURE BE DELIVERED) IN CONNECTION
HEREWITH OR ARISING FROM ANY BANKING RELATIONSHIP EXISTING IN CONNECTION WITH
THIS AGREEMENT, THE NOTES OR THE SECURITY DOCUMENTS.
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BORROWER AGREES THAT ANY SUCH ACTION OR PROCEEDING SHALL BE TRIED BEFORE A COURT
AND NOT BEFORE A JURY.
Borrower acknowledges that it have been informed by the Agents that the
provisions of this Section 12.10 constitute a material inducement upon which
each of the Banks has relied and will rely in entering into this Agreement and
the other Loan Documents, and that Borrower has reviewed the provisions of this
Section 12.10 with its legal counsel. Any of the Banks, the Agents or the
Borrower may file an original counterpart or copy of this Section 12.10 with any
court or Tribunal as written evidence of the express consent of the Borrower,
the Agents and the Banks to the waiver of their rights to trial by jury.
12.11 Full Agreement. This Agreement and the other Loan Documents
contain the full agreement of the parties and supersede all negotiations and
agreements prior to the date hereof.
12.12 Headings. The article and section headings of this Agreement are
for convenience of reference only and shall not constitute a part of the text
hereof nor alter or otherwise affect the meaning hereof.
12.13 Severability. The unenforceability or invalidity as determined by
a court of competent jurisdiction, of any provision or provisions of this
Agreement shall not render unenforceable or invalid any other provision or
provisions hereof.
12.14 Exceptions to Covenants. The Borrower shall not be deemed to be
permitted to take any action or fail to take any action which is permitted as an
exception to any of the covenants contained herein or which is within the
permissible limits of any of the covenants contained herein if such action or
omission would result in the breach of any other covenant contained herein.
12.15 Conflict with Security Documents. To the extent the terms and
provisions of any of the Security Documents are in conflict with the terms and
provisions hereof, this Agreement shall be deemed controlling.
12.16 Confidentiality. Each Bank will make no disclosure of
confidential information furnished to it by the Borrower or any of its
Subsidiaries unless such information shall have become public, except:
(i) in connection with operations under or the enforcement of this
Agreement or any other Loan Document;
(ii) pursuant to any statutory or regulatory requirement or any
mandatory court order, subpoena or other legal process;
(iii) to any parent or corporate Affiliate of such Bank or to any
Credit Participant, proposed Credit Participant or proposed Assignee; provided,
however, that any such Person shall agree to comply with the restrictions set
forth in this Section 12.16 with respect to such information;
(iv) to its independent counsel, auditors and other professional
advisors with an instruction to such Person to keep such information
confidential; and
(v) with the prior written consent of the Borrower, to any other
Person.
12.17 Existing Credit Agreement. This Agreement amends, modifies and
replaces the Existing Credit Agreement in all respects; provided, however the
liens and the priorities thereof granted in the Existing Credit Agreement and
the Security Documents therein described and defined (including the Security
Agreement) are hereby ratified, confirmed and continued in full force and effect
for all purposes without any interruption whatsoever.
12.18 Counterparts. This Agreement may be executed in any number of
counterparts, all of which taken together shall constitute one and the same
instrument. Delivery of an executed counterpart of a signature page of this
Agreement by telecopier or facsimile shall be as effective as delivery of a
manually executed counterpart hereof.
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[REMAINDER OF PAGE LEFT BLANK INTENTIONALLY]
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed and delivered in Tulsa, Oklahoma, effective as of the day and year
first above written.
"Borrower"
HERITAGE OPERATING, L.P., a Delaware
limited partnership
By: Heritage Holdings, Inc.,
a Delaware corporation,
general partner
By
---------------------------------
H. Xxxxxxx Xxxxxxxx
President
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed and delivered in Tulsa, Oklahoma, effective as of the day and year
first above written.
"Banks"
BANK OF OKLAHOMA, NATIONAL
ASSOCIATION
By
------------------------------------------
Xxxxxx X. Xxxxxx, Senior Vice President
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed and delivered in Tulsa, Oklahoma, effective as of the day and year
first above written.
LOCAL OKLAHOMA BANK, N.A.
By
-------------------------------------------
Xxxxxxxxx X. Blue, Senior Vice President
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed and delivered in Tulsa, Oklahoma, effective as of the day and year
first above written.
MERCANTILE BANK NATIONAL ASSOCIATION
By
-----------------------------------------
Xxxxxxx X. Xxxxxx, Vice President
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed and delivered in Tulsa, Oklahoma, effective as of the day and year
first above written.
"Administrative Agent"
BANK OF OKLAHOMA, NATIONAL
ASSOCIATION
By
------------------------------------------
Xxxxxx X. Xxxxxx, Senior Vice President
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed and delivered in Tulsa, Oklahoma, effective as of the day and year
first above written.
"Co-Agent"
MERCANTILE BANK NATIONAL ASSOCIATION
By
------------------------------------------
Xxxxxxx X. Xxxxxx, Vice President
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