BRIDGE LOAN AGREEMENT DATED AS OF MARCH 1, 2006 BY AND AMONG SOUTHERN UNION COMPANY AND ENHANCED SERVICE SYSTEMS, INC., as the Borrowers, AND THE BANKS PARTY HERETO, as the Banks, AND LEHMAN COMMERCIAL PAPER INC., as the Administrative Agent JPMORGAN...
Exhibit
10.2
DATED
AS OF MARCH 1, 2006
BY
AND AMONG
SOUTHERN
UNION COMPANY
AND
ENHANCED
SERVICE SYSTEMS, INC.,
as
the Borrowers,
AND
THE
BANKS PARTY HERETO,
as
the Banks,
AND
XXXXXX
COMMERCIAL PAPER INC.,
as
the Administrative Agent
______________________________________________________
JPMORGAN
CHASE BANK, N.A.
and
WACHOVIA
BANK, NATIONAL ASSOCIATION,
as
Co-Syndication Agents
AND
CALYON
NEW YORK BRANCH
and
BANK
OF AMERICA, N.A.,
as
Co-Documentation Agents
AND
XXXXXX
BROTHERS INC.
and
XXXXXXX
LYNCH, PIERCE, XXXXXX & XXXXX INCORPORATED,
as
the Joint Lead Arrangers and Joint Bookrunners
TABLE
OF CONTENTS
|
1.
|
CERTAIN
DEFINITIONS
|
2
|
|
|
1.1
|
Definitions
|
2
|
|
|
1.2
|
Terms
Generally
|
23
|
|
|
2.
|
THE
LOANS
|
24
|
|
|
2.1
|
The
Loans
|
24
|
|
|
2.2
|
Interest
Rate Determination
|
26
|
|
|
2.3
|
Additional
Interest Rate Provisions
|
27
|
|
|
3.
|
JOINT
AND SEVERAL LIABILITY OF BORROWERS
|
29
|
|
|
3.1
|
Joint
and Several Liability of Borrowers
|
29
|
|
|
4.
|
PAYMENTS
AND PREPAYMENTS
|
32
|
|
|
4.1
|
Optional
and Mandatory Prepayment
|
32
|
|
|
4.2
|
Repayment
of the Loans; and Maturity of the Loans
|
33
|
|
|
4.3
|
Place
of Payment or Prepayment
|
33
|
|
|
4.4
|
No
Prepayment Premium or Penalty
|
34
|
|
|
4.5
|
Taxes
|
34
|
|
|
4.6
|
Reduction
or Termination of Commitments
|
34
|
|
|
5.
|
FEES
|
34
|
|
|
5.1
|
Specified
Fees
|
34
|
|
|
5.2
|
Fees
Not Interest
|
34
|
|
|
6.
|
APPLICATION
OF PROCEEDS
|
34
|
|
|
6.1
|
Application
of Proceeds
|
34
|
|
|
7.
|
REPRESENTATIONS
AND WARRANTIES
|
35
|
|
|
7.1
|
Organization
and Qualification
|
35
|
|
|
7.2
|
Financial
Statements
|
35
|
|
|
7.3
|
Litigation
|
35
|
|
|
7.4
|
Default
|
36
|
|
|
7.5
|
Title
to Assets
|
36
|
|
|
7.6
|
Payment
of Taxes
|
36
|
|
|
7.7
|
Conflicting
or Adverse Agreements or Restrictions; Governmental
Approvals
|
36
|
|
|
7.8
|
Authorization,
Validity, Etc.
|
36
|
|
|
7.9
|
Investment
Company Act Not Applicable
|
37
|
|
|
7.10
|
Public
Utility Holding Company Act Not Applicable
|
37
|
|
|
7.11
|
Regulations
G, T, U and X
|
37
|
|
|
7.12
|
ERISA
|
37
|
|
|
7.13
|
No
Financing of Certain Security Acquisitions
|
38
|
|
|
7.14
|
Franchises,
Co-Licenses, Etc
|
38
|
|
|
7.15
|
Lines
of Business
|
38
|
|
|
7.16
|
Environmental
Matters
|
38
|
()
|
7.17
|
No
Agreements Prohibiting Pledge of Southern Union Panhandle and Panhandle
Eastern Equity Interests
|
39
|
|
|
7.18
|
No
Agreements Prohibiting Pledge of Xxx Xxxxxxxxxx Acquired
Business
|
39
|
|
|
7.19
|
Use
of Proceeds
|
39
|
|
|
7.20
|
Disclosure
|
39
|
|
|
7.21
|
Xxx
Xxxxxxxxxx Acquired Business Matters
|
40
|
|
|
7.22
|
Collateral
Matters
|
40
|
|
|
8.
|
CONDITIONS
|
41
|
|
|
8.1
|
Representations
True and No Defaults
|
41
|
|
|
8.2
|
Governmental
Approvals
|
41
|
|
|
8.3
|
Compliance
With Law
|
41
|
|
|
8.4
|
Notice
of Borrowing and Other Documents
|
41
|
|
|
8.5
|
Payment
of Fees and Expenses
|
41
|
|
|
8.6
|
Loan
Documents, Opinions and Other Instruments
|
42
|
|
|
8.7
|
Consummation
of Xxx Xxxxxxxxxx Acquisition
|
43
|
|
|
8.8
|
No
Material Adverse Change
|
43
|
|
|
8.9
|
Financial
Statements
|
43
|
|
|
8.10
|
Indebtedness
|
43
|
|
|
8.11
|
Miscellaneous
Documents
|
44
|
|
|
8.12
|
Officers’
Certificate
|
44
|
|
|
9.
|
AFFIRMATIVE
COVENANTS
|
44
|
|
|
9.1
|
Financial
Statements and Information
|
44
|
|
|
9.2
|
Lease
and Investment Schedules
|
45
|
|
|
9.3
|
Books
and Records
|
45
|
|
|
9.4
|
Insurance
|
45
|
|
|
9.5
|
Maintenance
of Property
|
46
|
|
|
9.6
|
Inspection
of Property and Records
|
46
|
|
|
9.7
|
Existence,
Laws, Obligations
|
46
|
|
|
9.8
|
Notice
of Certain Matters
|
46
|
|
|
9.9
|
ERISA
|
46
|
|
|
9.10
|
Compliance
with Environmental Laws
|
47
|
|
|
9.11
|
PGA
Clauses
|
48
|
|
|
9.12
|
Conveyance
of Acquired Business Equity Interests to Subsidiaries of the
Parent
|
48
|
|
|
9.13
|
Collateral
Matters Upon Acquired Business Equity Interests Transfer
|
48
|
|
|
9.14
|
Control
of SUG EAT LLC
|
49
|
|
|
10.
|
NEGATIVE
COVENANTS
|
49
|
|
|
10.1
|
Capital
Requirements
|
49
|
|
|
10.2
|
Mortgages,
Liens, Etc
|
50
|
|
|
10.3
|
Debt
|
51
|
|
|
10.4
|
Loans,
Advances and Investments
|
53
|
|
|
10.5
|
Stock
and Debt of Subsidiaries
|
55
|
()
|
10.6
|
Merger,
Consolidation, Etc.
|
55
|
|
|
10.7
|
Supply
and Purchase Contracts
|
56
|
|
|
10.8
|
Sale
or Other Disposition of Assets
|
56
|
|
|
10.9
|
Discount
or Sale of Receivables
|
58
|
|
|
10.10
|
Change
in Accounting Method
|
58
|
|
|
10.11
|
Restricted
Payment
|
58
|
|
|
10.12
|
Securities
Credit Regulations
|
58
|
|
|
10.13
|
Nature
of Business; Management
|
59
|
|
|
10.14
|
Transactions
with Related Parties
|
59
|
|
|
10.15
|
Hazardous
Materials
|
59
|
|
|
10.16
|
Limitations
on Payments on Subordinated Debt
|
59
|
|
|
10.17
|
No
Agreements Prohibiting Pledge of Southern Union Panhandle and Panhandle
Eastern Equity Interests
|
59
|
|
|
10.18
|
No
Agreements Prohibiting Pledge of the Xxx Xxxxxxxxxx Acquired Business
Equity Interests
|
59
|
|
|
10.19
|
Restriction
on Transfer
|
60
|
|
|
11.
|
EVENTS
OF DEFAULT; REMEDIES
|
60
|
|
|
11.1
|
If
any of the following events shall occur
|
60
|
|
|
(A)
|
Failure
to Pay Principal or Interest
|
61
|
|
|
(B)
|
Failure
to Pay Fee or Other Amounts
|
61
|
|
|
(C)
|
Failure
to Pay Other Debt
|
61
|
|
|
(D)
|
Misrepresentation
or Breach of Warranty
|
61
|
|
|
(E)
|
Violation
of Certain Covenants
|
61
|
|
|
(F)
|
Violation
of Other Covenants, Etc
|
61
|
|
|
(G)
|
Bankruptcy
and Other Matters
|
62
|
|
|
(H)
|
Dissolution
|
62
|
|
|
(I)
|
Undischarged
Judgment
|
62
|
|
|
(J)
|
Environmental
Matters
|
62
|
|
|
(K)
|
Default
under the Existing Revolving Credit Facility
|
63
|
|
|
(L)
|
Change
in Control
|
63
|
|
|
(M)
|
Change
in Ownership
|
63
|
|
|
(N)
|
Invalidity
of Lien on Collateral
|
63
|
|
|
(O)
|
Restricted
SUG EAT Entities Activities
|
63
|
|
|
(P)
|
Modifications
|
64
|
|
|
12.
|
THE
AGENT
|
64
|
|
|
12.1
|
Authorization
and Action
|
64
|
|
|
12.2
|
Agent’s
Reliance, Etc
|
65
|
|
|
12.3
|
Defaults
|
65
|
|
|
12.4
|
LCPI
and Affiliates
|
66
|
|
|
12.5
|
Non-Reliance
on Agent and Other Banks
|
66
|
|
|
12.6
|
Indemnification
|
66
|
|
|
12.7
|
Successor
Agent
|
67
|
()
|
12.8
|
Agent’s
Reliance
|
67
|
|
|
13.
|
MISCELLANEOUS
|
68
|
|
|
13.1
|
Representation
by the Banks
|
68
|
|
|
13.2
|
Amendments,
Waivers, Etc
|
68
|
|
|
13.3
|
Reimbursement
of Expenses
|
68
|
|
|
13.4
|
Notices
|
69
|
|
|
13.5
|
Governing
Law; Jurisdiction; Consent to Service of Process
|
70
|
|
|
13.6
|
Survival
of Representations, Warranties and Covenants
|
70
|
|
|
13.7
|
Counterparts
|
70
|
|
|
13.8
|
Severability
|
71
|
|
|
13.9
|
Descriptive
Headings
|
71
|
|
|
13.10
|
Accounting
Terms
|
71
|
|
|
13.11
|
Limitation
of Liability
|
71
|
|
|
13.12
|
Set-Off
|
71
|
|
|
13.13
|
Sale
or Assignment
|
72
|
|
|
13.14
|
Non
U.S. Banks
|
74
|
|
|
13.15
|
Interest
|
74
|
|
|
13.16
|
Indemnification
|
75
|
|
|
13.17
|
Payments
Set Aside
|
76
|
|
|
13.18
|
Bridge
Loan Agreement Controls
|
77
|
|
|
13.19
|
Obligations
Several
|
77
|
|
|
13.20
|
Pro
Rata Treatment
|
77
|
|
|
13.21
|
No
Rights, Duties or Obligations of Syndication Agent or Documentation
Agent
|
78
|
|
|
13.22
|
Final
Agreement
|
78
|
|
|
13.23
|
WAIVER
OF JURY TRIAL
|
78
|
|
|
13.24
|
USA
Patriot Act
|
78
|
|
|
13.25
|
Successors
and Assigns Generally
|
78
|
SCHEDULES
Schedule
2.1(a) - Commitments
Schedule
7.1(A)- List
of
Subsidiaries
Schedule
7.1(B)- Ownership
Structure of Partnership Companies as of Closing Date
Schedule
7.3 - Disclosed
Litigation
Schedule
7.6 - Tax
Matters
Schedule
7.7 - Required
Consents
Schedule
7.12 - ERISA
Matters
()
EXHIBITS
Exhibit
A - Form
of
Note
Exhibit
B - Form
of
Notice of Borrowing
Exhibit
C - Form
of
Assignment and Acceptance
Exhibit
D-1 - Form
of
Parent Pledge Agreement
Exhibit
D-2 - Form
of
SUG EAT Entities Pledge Agreement
Exhibit
E - Form
of
Opinion
Exhibit
F - Form
of
Intercreditor Agreement
()
This
BRIDGE LOAN AGREEMENT is dated as of March 1, 2006, and entered into by and
among SOUTHERN UNION COMPANY, a Delaware corporation (the “Parent”),
ENHANCED SERVICE SYSTEMS, INC. a Delaware corporation and a direct wholly-owned
Subsidiary (defined below) of the Parent (“ESSI”
and
together with the Parent, the “Borrowers”
and
each a “Borrower”),
the
Banks (as such term is defined in Section 1.1 below) from time to time party
hereto, and XXXXXX COMMERCIAL PAPER INC., as administrative agent (in such
capacity, the “Agent”)
for
the Banks.
WITNESSETH:
WHEREAS,
pursuant to a purchase and sale agreement, dated as of December 15, 2005
(including any annexes, schedules and exhibits thereto) (as the same may
be
amended, supplemented or otherwise modified from time to time in accordance
with
the provisions hereof and thereof, the “Xxx
Xxxxxxxxxx Acquisition
Agreement”),
by
and among SRCG, Ltd., a Texas limited partnership, as seller (“SRCG”),
SRCG
Genpar, L.P., a Delaware limited partnership, as seller (“Genpar”
and,
together with SRCG, the “Sellers”),
Southern Union Gathering Company LLC, a Delaware limited liability company
and a
wholly-owned subsidiary of the Parent (“SUGC”),
and
Southern Union Panhandle LLC, a Delaware limited liability company and a
wholly-owned subsidiary of the Parent (“Southern
Union Panhandle”
and
together with SUGC, the “SUG
Purchasers”),
(b)
the Assignment and Assumption Agreement For Purchase and Sale of Property,
dated
as of February 27, 2006 (the “Xxx
Xxxxxxxxxx Acquisition Agreement Assignment”
and
together with the Xxx Xxxxxxxxxx Acquisition Agreement, the “Xxx
Xxxxxxxxxx Acquisition Documents”),
by
and among the SUG Purchasers and the SUG EAT Entities (defined below), pursuant
to which the SUG Purchasers shall assign to the SUG EAT Entities all of their
respective rights, title and interests in and to the Xxx Xxxxxxxxxx Acquisition
Agreement and any other related documents, SUG EAT Inc. (defined below) will
purchase from SRCG (i) 100% of all issued and outstanding limited partner
interests in Xxx Xxxxxxxxxx Energy Services, Ltd., a Texas limited partnership
(“SRES”),
and
(ii) 100% of all issued and outstanding limited partner interests in Xxxxxxxxxx
Energy Marketing, Ltd., a Texas limited partnership (“REM”)
and
(b) SUG EAT LLC (defined below) will purchase from Genpar (i) 100% of all
issued
and outstanding general partner interests in SRES, (ii) 100% of all issued
and
outstanding general partner interests in REM and (iii) 100% of all issued
and
outstanding general partner interests in Leapartners, L.P., a Texas limited
partnership (“Leapartners”
and
together with SRES and REM, the “Xxx
Xxxxxxxxxx Acquired
Business”)
(such
purchase of partnership interests described in the foregoing is referred
to
herein as the “Xxx
Xxxxxxxxxx Acquisition”).
WHEREAS,
in order to effect the Xxx Xxxxxxxxxx Acquisition, ESSI shall make a loan
in the
aggregate principal amount of $1.6 billion to the SUG EAT Entities (the
“SUG
EAT Entities Loan”)
on the
Closing Date (defined below) pursuant to the SUG EAT Entities Loan Documents
(defined below). The proceeds of the SUG EAT Entities Loan shall be used
by the
SUG EAT Entities to fund the purchase price of the Xxx Xxxxxxxxxx Acquisition.
As security for the SUG EAT Entities Loan, the SUG EAT Entities shall, on
the
Closing Date, grant
--
to
ESSI a
second priority security interest in 100% of all issued and outstanding limited
partner interests in SRES and REM and 100% of all issued and outstanding
general
partner interests in SRES, REM and Leapartners.
WHEREAS,
the Borrowers have requested the Banks to extend credit on the Closing Date
in
an aggregate principal amount of $1.6 billion.
WHEREAS,
the proceeds of the Loans are to be used in accordance with Section 6.1 of
this Agreement.
NOW,
THEREFORE, the Banks are willing to extend such credit to Borrowers on the
terms
and subject to the conditions set forth herein. Accordingly, the parties
hereto
agree as follows:
1. CERTAIN
DEFINITIONS
:
INTERPRETATION.
1.1 Definitions
:
As
used
in this Agreement, the following terms shall have the following
meanings:
“Acquired
Business Equity Interests”
shall
mean, collectively, (i) 100% of all issued and outstanding Equity Interests
in
REM, (ii) 100% of all issued and outstanding Equity Interests in SRES and
(iii)
100% of all issued and outstanding general partner interests in
Leapartners.
“Acquired
Business Equity Interests Transfer”
shall
mean the transfer of all the Acquired Business Equity Interests to one or
more
wholly-owned Subsidiaries of the Parent (other than any of the SUG Partnership
Entities) upon the consummation of the Qualified Transaction or pursuant
to
Section 9.12(b); and the Borrower and such Subsidiaries shall have complied
in
all respects with Section 9.13.
“Acquired
Business Material Adverse Effect”
means
any circumstance, change or effect that (i) is materially adverse to the
business, operations (including results of operation), assets, liabilities
or
financial condition of the Partnership Companies taken as a whole or (ii)
materially impedes the ability of the Sellers to complete the transactions
contemplated in the Xxx Xxxxxxxxxx Acquisition Documents or to perform their
obligations thereunder, but in the case of clause (i) above, shall exclude
any
circumstance, change or effect (except, as to clauses (a) and (c) below,
to the
extent that such circumstance, change or effect shall have a disproportionate
impact (vis-á-vis other entities with operations in the counties where the
Partnership Companies have physical assets) on the Partnership Companies)
resulting or arising from: (a) any change in general economic conditions
in the
industries or markets in which a Partnership Company operates; (b) seasonal
reductions in revenues and/or earnings of the Partnership Companies in the
ordinary course of their respective businesses; (c) national or international
political, diplomatic or military conditions, including any engagement in
hostilities, whether or not pursuant to a declaration of war, or the occurrence
of any military or terrorist attack; and (d) changes in accounting principles
generally accepted in the United States
--
as
in
effect from time to time, as consistently applied, or other accounting
principles after the date of the Xxx Xxxxxxxxxx Acquisition
Agreement.
“Additional
Costs”
shall
mean, with respect to any Rate Period in the case of any Eurodollar Rate
Loan,
all costs, losses or payments, as determined by any Bank in its sole and
absolute discretion (which determination shall be conclusive in the absence
of
manifest error) that such Bank or its Domestic Lending Office or its Eurodollar
Lending Office does, or would, if such Eurodollar Rate Loan were funded during
such Rate Period by the Domestic Lending Office or the Eurodollar Lending
Office
of such Bank, incur, suffer or make by reason of:
(a) any
and
all present or future taxes (including, without limitation, any interest
equalization tax or any similar tax on the acquisition of debt obligations,
or
any stamp or registration tax or duty or official or sealed papers tax),
levies,
imposts or any other charge of any nature whatsoever imposed by any taxing
authority on or with regard to any aspect of the transactions contemplated
by
this Agreement, except such taxes as may be measured by the overall net income
of such Bank or its Domestic Lending Office or its Eurodollar Lending Office
and
imposed by the jurisdiction, or any political subdivision or taxing authority
thereof, in which such Bank’s Domestic Lending Office or its Eurodollar Lending
Office is located; and
(b) any
increase in the cost to such Bank of agreeing to make or making, funding
or
maintaining any Eurodollar Rate Loan because of or arising from (i) the
introduction of, or any change (other than any change by way of imposition
or
increase of reserve requirements, in the case of any Eurodollar Rate Loan,
included in the Eurodollar Rate Reserve Percentage) in or in the interpretation
or administration of, any law or regulation or (ii) the compliance with any
request from any central bank or other governmental authority (whether or
not
having the force of law).
“Affiliate”
shall
mean any Person controlling, controlled by or under common control with any
other Person. For purposes of this definition, “control” (including “controlled
by” and “under common control with”) shall mean the possession, directly or
indirectly, of the power to direct or cause the direction of the management
and
policies of such Person, whether through the ownership of voting securities
or
otherwise. If any Person shall own, directly or indirectly, beneficially
or of
record, twenty percent (20%) or more of the voting equity (whether outstanding
capital stock, partnership interests or otherwise) of another Person, such
Person shall be deemed to be an Affiliate.
“Agent”
shall
have the meaning set forth in the preamble hereto.
“Agreement”
shall
mean this Bridge Loan Agreement, as the same may be amended, modified,
supplemented or restated from time to time.
“Alternate
Base Rate”
shall
mean,
--
(a)
for
any day during the period from and including the Closing Date to and including
the third day following the Closing Date, the Initial Alternate Base Rate;
and
(b)
for
any day thereafter, a rate, per annum (rounds upward to the nearest 1/16
of 1%)
equal to: (i) the greater of (x) the Prime Rate (computed on the basis of
the
actual number of days elapsed over a year of 365 or 366 days, as the case
may
be) in effect on such day; or (ii) the Federal Funds Rate in effect for such
day
plus one-half of one percent (1/2%) (computed on the basis of the actual
number
of days elapsed over a year of 360 days), plus (ii) the Applicable Margin.
“Alternate
Base Rate Loan”
shall
mean any Loan which bears interest at the Alternate Base Rate.
“Applicable
Lending Office”
shall
mean, with respect to each Bank, such (a) Domestic Lending Office in the
case of an Alternate Base Rate Loan; and (b) Eurodollar Lending Office in
the
case of a Eurodollar Rate Loan.
“Applicable
Margin”
shall
mean, at any date, (a) with respect to Eurodollar Rate Loans, the applicable
percentage per annum set forth below under the caption “Applicable Margin for
Eurodollar Rate Loans” and (b) with respect to Alternate Base Rate Loans, the
applicable percentage per annum set forth below under the caption “Applicable
Margin for Alternate Base Rate Loans”, in each case changing with the rating of
the Parent’s unsecured, non-credit enhanced Senior Funded Debt and determined in
accordance with the following grid:
|
Rating
of the Parent’s
unsecured,
non-credit enhanced
Senior
Funded Debt
|
Applicable
Margin
for
Eurodollar
Rate Loans
|
Applicable
Margin
for
Alternate
Base Rate Loans
|
|
Equal
to or greater than A3 by Xxxxx’x and equal to or greater than A- by
S&P
|
0.425%
|
0.000%
|
|
Baa1
by Xxxxx’x or BBB+ by S&P
|
0.500%
|
0.000%
|
|
Baa2
by Xxxxx’x or BBB by S&P
|
0.575%
|
0.000%
|
|
Baa3
by Xxxxx’x or BBB- by S&P
|
0.725%
|
0.000%
|
|
Ba1
by Xxxxx’x or BB+ by S&P
|
1.100%
|
0.100%
|
|
Less
than Ba1 by Xxxxx’x and less than BB+ by S&P
|
1.350%
|
0.350%
|
--
Notwithstanding
the foregoing provisions, in the event that ratings of the Parent’s unsecured,
non-credit enhanced Senior Funded Debt under Xxxxx’x and under S&P’s fall
within different rating categories which are not functional equivalents,
the
Eurodollar Rate Loans and the Alternate Base Rate Loans shall be based on
the
higher of such ratings if there is only one category differential between
the
functional equivalents of such ratings, and if there is a two category
differential between the functional equivalents of such ratings, the component
of pricing from the grid set forth above shall be based on the rating category
which is then in the middle of or between the two category ratings which
are
then in effect, and if there is greater than a two category differential
between
the functional equivalents of such ratings, the component of pricing from
the
grid set forth above shall be based on the rating category which is then
one
rating category above the lowest of the two category ratings which are then
in
effect. Additionally, in the event that the Parent withdraws from having
its
unsecured, non-credit enhanced Senior Funded Debt being rated by Xxxxx’x or
S&P, so that one or both of such ratings services fails to rate the Parent’s
unsecured, non-credit enhanced Senior Funded Debt, the component of pricing
from
the grid set forth above for purposes of determining the Applicable Margin
for
Eurodollar Rate Loans and the Alternate Base Rate Loans commencing thereafter
shall be (x) in the case of Eurodollar Rate Loans, 1.350% and (y) in the
case of
Alternate Base Rate Loans, 0.350%, in each case until such time as the Parent
subsequently causes its unsecured, non-credit enhanced Senior Funded Debt
to be
rated by both of said ratings services.
“Approved
Fund”
means
any Person (other than a natural person) that is engaged in making, purchasing,
holding or investing in bank loans and similar extensions of credit in the
ordinary course of its business and that is administered or managed by (a)
a
Bank, (b) an Affiliate of a Bank or (c) an entity or an Affiliate of an entity
that administers or manages a Bank.
“Asset
Sale”
shall
mean any conveyance, sale, lease, sublease, assignment, transfer or other
disposition (including by way of merger or consolidation and including any
sale
and leaseback transaction) of any property by the Parent or any of its
Subsidiaries to any Person; provided, however,
that an
Asset Sale shall not include (x) any disposition of cash and cash equivalents
in
the ordinary course of business, (y) any conveyance, sale, lease, assignment,
transfer or other disposition of Property to the extent such conveyance,
sale,
lease, assignment, transfer or disposition is permitted pursuant to clause
(i)
in the proviso in Section 10.8 and (z) any conveyance, sale, assignment,
transfer or other disposition of Property for fair market value resulting
in no
more than $1,000,000 in net cash proceeds per Asset Sale (or series of related
Asset Sales).
“Assignment
and Acceptance”
shall
have the meaning set forth in Section 13.13.
“Bank
Affiliate”
shall
have the meaning set forth in Section 13.13(g).
“Banks”
shall
mean, collectively, (a) each Person listed on Schedule
2.1(a)
that is
a party to this Agreement and (b) any Person that becomes a “Bank” hereunder
pursuant to an
--
Assignment
and Acceptance, other than any such Person that ceases to be a party hereto
pursuant to such Assignment and Acceptance.
“Borrower”
or
“Borrowers”
shall
have the meaning set forth in the preamble hereto.
“Borrowing”
shall
mean Loans of the same Type, made pursuant to Section 2.1(a), converted or
continued on the same date and, in the case of Eurodollar Rate Loans, as
to
which a single Rate Period is in effect.
“Borrowing
Date”
shall
mean, as applicable, (a) the date on which the Loans were made by the Banks
pursuant to Section 2.1(a), which shall be the Closing Date, or (b) if
applicable, a date of the continuation or conversion of Eurodollar Loans
and/or
Alternate Base Rate Loans, in each case with respect to clauses (a) and (b)
above, as set forth in a Notice of Borrowing delivered pursuant to Section
2.1(c).
“Business
Day”
shall
mean a day when the Agent is open for business, provided
that, if
the applicable Business Day relates to any Eurodollar Rate Loan, it shall
mean a
day when the Agent is open for business and banks are open for business in
the
London interbank market and in New York City.
“Capital
Lease”
shall
mean any lease of any Property (whether real, personal, or mixed) which,
in
conformity with GAAP, is accounted for as a capital lease on the balance
sheet
of the lessee.
“Capitalized
Lease Obligations”
shall
mean, for the Parent and its Subsidiaries, any of their obligations that
should,
in accordance with GAAP, be recorded as Capital Leases.
“Cash
Interest Expense”
shall
mean, for any period, total interest expense to the extent paid in cash
(including the interest component of Capitalized Lease Obligations and
capitalized interest and all dividends and interest paid on or with respect
to
the Parent’s Structured Securities) of the Parent and any of its Subsidiaries
for such period all as determined in conformity with GAAP.
“CCE
Group”
shall
mean CCE Holdings and its Subsidiaries.
“CCE
Holdings”
shall
mean CCE Holdings LLC, a Delaware limited liability company.
“CDEC”
shall
mean Chicago Deferred Exchange Corporation, an Illinois corporation and a
wholly-owned subsidiary of LaSalle National Bank, a national banking
association. CDEC shall act as a “qualified intermediary” for the Parent
pursuant to an agreement between CDEC and the Parent to facilitate the Qualified
Transaction.
“Change
of Control”
shall
mean (a) the acquisition of ownership, directly or indirectly, beneficially
or
of record, by any Person or group (within the meaning of the Securities Exchange
Act of 1934 and the rules of the Securities and Exchange Commission thereunder
--
as
in
effect on the date hereof), of shares representing more than 30% of the
aggregate ordinary voting power represented by the issued and outstanding
capital stock of the Parent; or (b) the occupation of a majority of the seats
(other than vacant seats) on the Board of Directors of the Parent by Persons
who
were neither (i) nominated by the Board of Directors of the Parent nor (ii)
appointed by directors so nominated.
“Closing
Date”
shall
mean March 1, 2006.
“Code”
shall
mean the Internal Revenue Code of 1986, as amended, as now or hereafter in
effect, together with all regulations, rulings and interpretations thereof
or
thereunder issued by the Internal Revenue Service.
“Collateral”
shall
mean all “Collateral” referred to in the Collateral Documents and all other
property that is or is intended to be subject to any Lien in favor of the
Agent
for the benefit of the Secured Parties.
“Collateral
Documents”
shall
mean the Pledge Agreements and each other agreement that creates or purports
to
create a Lien in favor of the Agent for the benefit of the Secured Parties,
and
the Intercreditor Agreement.
“Commitment”
shall
have the meaning set forth in Section 2.1(a) and “Commitments”
shall
mean, collectively, the Commitments of all of the Banks.
“Consolidated
Net Income”
shall
mean for any period the consolidated net income of the Parent and all of
its
Subsidiaries, determined in accordance with GAAP, for such period.
“Consolidated
Net Worth”
shall
mean, for any period for the Parent and all of its Subsidiaries, (a) the
sum of
the following consolidated items, all determined in accordance with GAAP
and
without duplication: the consolidated stockholders’ equity of all classes of
stock (whether common, preferred, mandatorily convertible preferred or
preference) of the Parent and its Subsidiaries; the Equity-Preferred Securities;
the other preferred securities of the Parent’s Subsidiaries not constituting
Equity-Preferred Securities; and the minority interests in the Parent’s
Subsidiaries, less (b) the sum of the following consolidated items, without
duplication: the book amount of any deferred charges (including, but not
limited
to, unamortized debt discount and expenses, organization expenses, experimental
and development expenses, but excluding prepaid expenses) that are not permitted
to be recovered by the Parent or its applicable Subsidiaries under rates
permitted under rate tariffs, plus (c) the sum of all amounts contributed
or
paid by the Parent to the Rabbi Trusts for purposes of funding the same,
but
only to the extent such contributions and payments are required to be deducted
from the consolidated stockholders’ equity of the Parent and its Subsidiaries in
accordance with GAAP.
“Consolidated
Total Capitalization”
shall
mean at any time the sum of: (a) Consolidated Net Worth at such time; plus
(b)
the principal amount of outstanding Debt (other than Equity-Preferred Securities
(to the extent included in Debt of the Parent and its Subsidi
--
aries)
not to exceed 10% of Consolidated Total Capitalization calculated for purposes
of this clause without reference to any Equity-Preferred Securities) of the
Parent and its Subsidiaries.
“Consolidated
Total Indebtedness”
shall
mean all Debt of the Parent and all of its Subsidiaries including any current
maturities thereof, plus, without duplication, all amounts outstanding under
Standby Letters of Credit and, without duplication, all reimbursement or
repayment obligations of the Parent with respect to all Letters of Credit,
less,
without duplication and to the extent included in Debt of the Parent and
its
Subsidiaries, Equity-Preferred Securities not to exceed 10% of Consolidated
Total Capitalization (calculated for purposes of this clause without reference
to any Equity-Preferred Securities).
“Credit
Exposure”
shall
mean, with respect to any Bank, (a) the amount of its Commitment, if still
in
existence, or (b) the aggregate outstanding principal amount of its Loans,
if
the Commitments are no longer in existence.
“Cross
Country”
shall
mean CrossCountry Energy, LLC, a Delaware limited liability
company.
“Debt”
shall
mean (without duplication), for any Person indebtedness for money borrowed
determined in accordance with GAAP but in any event including, (a) indebtedness
of such Person for borrowed money or arising out of any extension of credit
to
or for the account of such Person (including, without limitation, extensions
of
credit in the form of reimbursement or payment obligations of such Person
relating to letters of credit issued for the account of such Person) or for
the
deferred purchase price of property or services, except indebtedness which
is
owing to trade creditors in the ordinary course of business and which is
due
within thirty (30) days after the original invoice date; (b) indebtedness
of the
kind described in clause (a) of this definition which is secured by (or for
which the holder of such Debt has any existing right, contingent or otherwise,
to be secured by) any Lien upon or in Property (including, without limitation,
accounts and contract rights) owned by such Person, whether or not such Person
has assumed or become liable for the payment of such indebtedness or
obligations; (c) Capitalized Lease Obligations of such Person; and (d)
obligations under direct or indirect Guaranties other than Guaranties issued
by
the Parent covering obligations of the Southern Union Trusts under the
Structured Securities. Whenever the definition of Debt is being used herein
in
order to compute a financial ratio or covenant applicable to the consolidated
business of the Parent and its Subsidiaries, Debt which is already included
in
such computation by virtue of the fact that it is owed by a Subsidiary of
the
Parent will not also be added by virtue of the fact that the Parent has executed
a guaranty with respect to such Debt that would otherwise require such
guaranteed indebtedness to be considered Debt hereunder. Nothing contained
in
the foregoing sentence is intended to limit the other provisions of this
Agreement which contain limitations on the amount and types of Debt which
may be
incurred by the Parent or its Subsidiaries.
“Debt
Issuance”
shall
mean the incurrence or issuance by the Parent or any of its Subsidiaries
of any
Debt or other indebtedness after the Closing Date;
--
“Debtor
Laws”
shall
mean all applicable liquidation, conservatorship, bankruptcy, moratorium,
arrangement, receivership, insolvency, reorganization, or similar laws, or
general equitable principles from time to time in effect affecting the rights
of
creditors generally.
“Default”
shall
mean any of the events specified in Section 11.1, whether or not there has
been
satisfied any requirement in connection with such event for the giving of
notice, or the lapse of time, or the happening of any further condition,
event
or act.
“Dollars”
and
“$”
shall
mean lawful currency of the United States of America.
“Domestic
Lending Office”
shall
mean, with respect to each Bank, the office of such Bank located at its “Address
for Notices” set forth below the name of such Bank on the signature pages hereof
or such other office of such Bank as such Bank may from time to time specify
to
the Borrowers and the Agent.
“EBDIT”
shall
mean for any period the sum of (a) consolidated net earnings for the Parent
and
its Subsidiaries (excluding for all purposes hereof all extraordinary items),
plus (b) each of the following to the extent actually deducted in deriving
such
net earnings: (i) depreciation and amortization expense; (ii) interest expense;
(iii) federal and state income taxes; and (iv) dividends charged against
income
on or with respect to Structured Securities, in each case before adjustment
for
extraordinary items, as shown in the financial statements of Parent and its
Subsidiaries referred to in Section 7.2 hereof (excluding for all purposes
hereof all extraordinary items), and determined in accordance with GAAP,
and (c)
plus (or minus, if applicable) the net amount of non-cash deductions from
(or
additions to, if applicable) such net earnings for such period attributable
to
fluctuations in the market price(s) of securities which the Parent is obligated
to purchase in future periods under any of the Rabbi Trusts, but only to
the
extent that such deductions (or additions, if applicable) are required to
be
taken in accordance with GAAP.
“Eligible
Assignee”
shall
mean: (i) any Bank, any Bank Affiliate, any Approved Fund, or any institution
100% of the voting stock of which is directly, or indirectly owned by such
Bank
or by the immediate or remote parent of such Bank; or (ii) a commercial bank,
a
foreign branch of a United States commercial bank, a domestic branch of a
foreign commercial bank or other financial institution having in each case
assets in excess of $1,000,000,000.00.
“Environmental
Law”
shall
mean (a) the Comprehensive Environmental Response, Compensation and Liability
Act of 1980 (as amended by the Superfund Amendments and Reauthorization Act
of
1986, 42 U.S.C.A. § 9601 et
seq.),
as
amended from time to time, and any and all rules and regulations issued or
promulgated thereunder (“CERCLA”);
(b)
the Resource Conservation and Recovery Act (as amended by the Hazardous and
Solid Waste Amendment of 1984, 42 U.S.C.A. § 6901 et
seq.),
as
amended from time to time, and any and all rules and regulations promulgated
thereunder (“RCRA”);
(c)
the Clean Air Act, 42 U.S.C.A. § 7401 et
seq.,
as
amended from time to time, and any and all rules and regulations promulgated
thereunder; (d) the Clean Water Act of 1977, 33 X.X.XX § 1251 et
seq.,
as
--
amended
from time to time, and any and all rules and regulations promulgated thereunder;
(e) the Toxic Substances Control Act, 15 U.S.C.A. § 2601 et seq.,
as
amended from time to time, and any and all rules and regulations promulgated
thereunder; or (f) any other federal or state law, statute, rule, or emulation
enacted in connection with or relating to the protection or regulation of
the
environment (including, without limitation, those laws, statutes, rules,
and
regulations regulating the disposal, removal, production, storing, refining,
handling, transferring, processing, or transporting of Hazardous Materials)
and
any rules and regulations issued or promulgated in connection with any of
the
foregoing by any governmental authority, and “Environmental
Laws”
shall
mean each of the foregoing.
“EPA”
shall
mean the Environmental Protection Agency, or any successor
organization.
“Equity
Interests”
shall
mean, with respect to any Person, any and all shares, interests, participations
or other equivalents, including membership interests (however designated,
whether voting or nonvoting), of equity of such person, including, if such
person is a partnership, partnership interests (whether general or limited)
and
any other interest or participation that confers on a person the right to
receive a share of the profits and losses of, or distributions of property
of,
such partnership, whether outstanding on the date hereof or issued after
the
Closing Date.
“Equity
Issuance”
shall
mean, without duplication, any issuance or sale by the Parent or any of its
Subsidiaries after the Closing Date of any of its Equity Interests (including
any Equity Interests issued upon exercise of any warrant or option) or any
warrants or options to purchase Equity Interests; provided, however,
that an
Equity Issuance shall not include (i) any Debt Issuance, (ii) issuance
or sale by the Parent of its Equity Interests (including its Equity Interests
issued upon award of restricted stock units or exercise of any warrant or
option
or warrants or options to purchase its Equity Interests) to directors, officers
or employees of the Parent or any of its Subsidiaries pursuant to any of
the
Parent’s employee stock incentive plans, (iii) issuance or sale by the Parent of
any of its Equity Interests (including its Equity Interests issued upon the
award of restricted stock units or exercise of any warrants or options to
purchase Equity Interests) to officers or employees of the Parent or any
of its
Subsidiaries pursuant to the Parent’s stock incentive plan as part of any
retention or change in control agreement and (iv) any issuance or sale of
any Equity Interests in the Parent resulting from the settlement of the forward
stock purchase contracts or remarketing of the 2008 Senior Notes that constitute
a part of the 2003 Equity Units so long as the net cash proceeds received
from
such issuance or sale are promptly applied to repay amounts outstanding under
the Existing Revolving Credit Agreement.
“Equity-Preferred
Securities”
shall
mean (i) Debt, preferred equity or any other securities that are mandatorily
convertible by the issuer thereof at a date certain, without cash payment
by the
issuer, into common shares of stock of the Parent or (ii) Equity
Units of the Parent or (iii) any
other
securities (A) that are issued by the Parent or any of its Subsidiaries,
(B)
that are not subject to mandatory redemption at any time, directly or
indirectly, (C) that are perpetual or mature not less than 30 years from
the
date of issuance, (D) the Debt compo
--
nent,
if
any, issued in connection therewith, including any guaranty, is subordinate
in
right of payment to all other unsecured and unsubordinated Debt of the issuer
of
such Debt component (including any such guaranty, if applicable), and (E)
the
terms of which permit the issuer thereof to defer at any time, without any
additional payment or premium, the payment of any and all interest and/or
distributions thereon, as applicable, to a date occurring after the Maturity
Date.
“Equity
Units”
shall
mean securities issued by any Person and sold as a unit consisting of a
debt
security of such Person and a forward contract obligating the holder of
such
unit to purchase common shares of stock of such Person at a fixed price
on a
fixed date in the future.
“ERISA”
shall
mean the Employee Retirement Income Security Act of 1974, as amended from
time
to time, and all rules, regulations, rulings and interpretations thereof
issued
by the Internal Revenue Service or the Department of Labor
thereunder.
“ESSI”
shall
have the meaning set forth in the preamble hereto
“Eurocurrency
Liabilities”
shall
have the meaning assigned to that term in Regulation D of the Board of Governors
of the Federal Reserve System, as in effect from time to time.
“Eurodollar
Lending Office”
shall
mean, with respect to each Bank, the office of such Bank located at its “Address
for Notices” set forth below the name of such Bank on the signature pages
hereof, or such other office of such Bank as such Bank may from time to time
specify to the Borrowers and the Agent.
“Eurodollar
Rate”
shall
mean with respect to the applicable Rate Period in effect for each Eurodollar
Rate Loan, the sum of (a) the quotient obtained by dividing (i) the rate
appearing on Page 3750 of the Dow Xxxxx Market Service (or on any successor
or
substitute page of such Service, or any successor to or substitute for such
Service, providing rate quotations comparable to those currently provided
on
such page of such Service, as determined by the Agent from time to time for
purposes of providing quotations of interest rates applicable to dollar deposits
in the London interbank market) at approximately 11:00 a.m., London time,
two
Business Days prior to the commencement of such Rate Period, as the rate
for
dollar deposits with a maturity comparable to such Rate Period (or in the
event
that such rate quote is not available at such time for any reason, then
utilizing the rate at which dollar deposits of $5,000,000 and for a maturity
comparable to such Rate Period are offered by the principal London office
of the
Agent in immediately available funds in the London interbank market at
approximately 11:00 a.m., London time, two Business Days prior to the
commencement of such Rate Period) by (ii) a percentage equal to 100% minus
the
Eurodollar Rate Reserve Percentage for such Rate Period, plus (b) the Applicable
Margin.
“Eurodollar
Rate Loan”
shall
mean any Loan that bears interest at the Eurodollar Rate.
--
“Eurodollar
Rate Reserve Percentage”
of
the
Agent for any Rate Period for any Eurodollar Rate Loan shall mean the reserve
percentage applicable during such Rate Period (or if more than one such
percentages shall be so applicable, the daily average of such percentages
for
those days in such Rate Period during which any such percentage shall be
so
applicable) under regulations issued from time to time by the Board of Governors
of the Federal Reserve System (or any successor) for determining the maximum
reserve requirement (including, without limitation, any emergency, supplemental,
or other marginal reserve requirement) for member banks of the Federal Reserve
System with deposits exceeding $1,000,000,000 with respect to liabilities
or
assets consisting of or including Eurocurrency Liabilities having a term
equal
to such Rate Period.
“Event
of Default”
shall
mean any of the events specified in Section 11.1, 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.
“Expiration
Date”
shall
mean the last day of a Rate Period.
“Existing
Revolving Credit Facility”
shall
mean the revolving credit facility provided to the Parent under the terms
of the
Fourth Amended and Restated Revolving Credit Agreement, dated as of September
28, 2005, entered into by and among the Parent, JPMorgan Chase Bank, N.A.,
as
the administrative agent, and the banks and other financial institutions
party
thereto, as such credit agreement is amended, amended and restated, modified
or
supplemented from time to time.
“Existing
Revolving Credit Facility Closing Date”
shall
mean September 28, 2005.
“Existing
Revolving Credit Facility
Letter of Credit”
shall
mean any Standby Letter of Credit issued for the account of the Parent under
the
Existing Revolving Credit Facility.
“Federal
Funds Rate”
shall
mean, for any period, a fluctuating interest rate per annum equal for each
day
during such period to the weighted average of the rates (rounded to the nearest
1/100 of 1%) on overnight federal fund transactions with members of the Federal
Reserve System arranged by federal funds brokers, as published for such day
(or,
if such day is not a Business Day, for the next preceding Business Day) by
the
Federal Reserve Bank of New York, or, if such rate is not so published for
any
day which is a Business Day, the average of the quotations for such day on
such
transactions received by the Agent from three federal funds brokers of
recognized standing selected by the Agent.
“Fee
Letter”
shall
mean the Fee Letter dated February 10, 2006, entered into among the Parent,
the
Joint Lead Arrangers, LCPI, Xxxxxx Brothers Commercial Bank, and Xxxxxxx
Xxxxx
Bank USA.
“Funded
Debt”
shall
mean all Debt of a Person which matures more than one year from the date
of
creation or matures within one year from such date but is renewable or
extendible, at the option of such Person, by its terms or by the terms of
any
instrument or agreement relating thereto, to a date more than one year from
such
date or arises under a re
--
volving
credit or similar agreement which obligates Banks to extend credit during
a
period of more than one year from such date, including, without limitation,
all
amounts of any Funded Debt required to be paid or prepaid within one year
from
the date of determination of the existence of any such Funded Debt.
“GAAP”
shall
mean generally accepted accounting principles, applicable to the circumstances
as of the date of determination, applied consistently with such principles
as
applied in the preparation of the Parent’s audited financial statements referred
to in Section 7.2.
“Genpar”
shall
have the meaning set forth in the recitals hereto.
“Governmental
Authority”
shall
mean any (domestic or foreign) federal, state, county, municipal, parish,
provincial, or other government, or any department, commission, board, court,
agency (including, without limitation, the EPA), or any other instrumentality
of
any of them or any other political subdivision thereof, and any entity
exercising executive, legislative, judicial, regulatory, or administrative
functions of, or pertaining to, government, including, without limitation,
any
arbitration panel, any court, or any commission.
“Governmental
Requirement”
shall
mean any Order, Permit, law, statute (including, without limitation, any
Environmental Protection Statute), code, ordinance, rule, regulation,
certificate, or other direction or requirement of any Governmental
Authority.
“Grey
Ranch”
shall
mean Grey Ranch Plant, L.P., a Texas limited partnership.
“Guaranty”
shall
mean, with respect to any Person, any obligation, contingent or otherwise,
of
such Person directly or indirectly guaranteeing any Debt of another Person,
including, without limitation, by means of an agreement to purchase or pay
(or
advance or supply funds for the purchase or payment of) such Debt or to maintain
financial covenants, or to assure the payment of such Debt by an agreement
to
make payments in respect of goods or services regardless of whether delivered
or
to purchase or acquire the Debt of another, or otherwise, provided that the
term
“Guaranty” shall not include endorsements for deposit or collection in the
ordinary course of business.
“Hazardous
Materials”
shall
mean any substance which, pursuant to any Environmental Laws, requires special
handling in its collection, use, storage, treatment or disposal, including
but
not limited to any of the following: (a) any “hazardous waste” as defined by
RCRA; (b) any “hazardous substance” as defined by CERCLA; (c) asbestos; (d)
polychlorinated biphenyls; (e) any flammables, explosives or radioactive
materials; and (f) any substance, the presence of which on any of the Parent’s
or any of its Subsidiary’s properties is prohibited by any Governmental
Authority.
“Highest
Lawful Rate”
shall
mean, with respect to each Bank, the maximum nonusurious interest rate, if
any,
that at any time or from time to time may be contracted for, taken, reserved,
charged, or received with respect to the Loans or on other amounts, if any,
due
to such Bank pursuant to this Agreement, under laws applicable to such Bank
which are presently in effect, or, to the extent allowed by law, under such
applicable laws which may hereafter be in effect and which allow a higher
maximum nonusurious interest rate than applicable laws now allow.
“Indemnified
Parties”
shall
have the meaning set forth in Section 13.16.
“Initial
Alternate Base Rate”
shall
mean the rate per annum as determined in accordance with clause (b) in the
definition of Alternate Base Rate minus 2.25%.
“Intercreditor
Agreement”
shall
mean the Intercreditor Agreement to be executed and delivered on the Closing
Date by ESSI and the Agent and acknowledged by the SUG EAT Entities,
substantially in the form of Exhibit
F,
as the
same may be amended, supplemented or otherwise modified from time to
time.
“Interest
Payment Date”
shall
mean (a) as to any Eurodollar Rate Loan in which the Rate Period with respect
thereto is not greater than three (3) months, the date on which such Rate
Period
ends; (b) as to any Eurodollar Rate Loan in which the Rate Period with respect
thereto is greater than three (3) months, the date on which the third month
of
such Rate Period ends, and the date on which each such Rate Period ends;
(c) as
to any Alternate Base Rate Loan, the last Business Day of each March, June,
September and December to occur during any period in which such Loan is
outstanding and on the date such Alternate Base Rate Loan is converted to
another Type; and (d) as to all Loans, such time as the principal of and
interest on the Loans shall have been paid in full.
“Inventory”
shall
mean, with respect to the Parent or any of its Subsidiaries, all of such
Person’s now owned or hereafter acquired or created inventory in all of its
forms and of every nature, wherever located, whether acquired by purchase,
merger, or otherwise, and all raw materials, work in process therefor and
finished goods thereof, and all supplies, materials, and products of every
nature and description used, usable, or consumed in connection with the
manufacture, packing, shipping, advertising, selling, leasing, furnishing,
or
production of such goods, and shall include, in any event, all “inventory”
(within the meaning of such term in the Uniform Commercial Code in effect
in any
applicable jurisdiction), whether in mass or joint, or other interest or
right
of any kind in goods which are returned to, repossessed by, or stopped in
transit by such Person, and all accessions to any of the foregoing and all
products of any of the foregoing.
“Investment”
of
any
Person shall mean any investment so classified under GAAP, and, whether or
not
so classified, includes (a) any direct or indirect loan advance made by it
to
any other Person; (b) any direct or indirect Guaranty for the benefit of
such
Person; provided,
however,
that
for purposes of determining Investments of the Parent hereunder, the existing
Guaranty by the Parent of certain tax increment financing extended by The
Fidelity Deposit and Discount Bank to The Redevelopment Authority of the
County
of Lackawanna shall be deemed to not be an Investment; (c) any capital
contribution to any other Person; and (d) any ownership or similar interest
in
any other Person; and the amount of any Investment shall be the original
principal or capital amount thereof (plus
any
subsequent principal or capital amount) minus
all cash
returns of principal or capital thereof.
“Joint
Lead Arrangers”
shall
mean, collectively, Xxxxxx Brothers Inc. and Xxxxxxx Lynch, Pierce, Xxxxxx
&
Xxxxx Incorporated.
“LCPI”
shall
mean Xxxxxx Commercial Paper Inc.
“LDC
Proceeds”
shall
have the meaning set forth in the definition of Qualified
Transaction.
“LDC
Sale”
shall
have the meaning set forth in the definition of Qualified
Transaction.
“Leapartners”
shall
have the meaning set forth in the recitals hereto.
“Letter(s)
of Credit”
shall
mean, in the singular form, any letter of credit issued by any Person for
the
account of the Parent and, in the plural form, all such letters of credit
issued
by any Person for the account of the Parent.
“Lien”
shall
mean any mortgage, deed of trust, pledge, security interest, encumbrance,
lien
(including without limitation, any such interest arising under any Environmental
Law), or similar charge of any kind (including without limitation, any agreement
to give any of the foregoing, any conditional sale or other title retention
agreement or any lease in the nature thereof), or the interest of the lessor
under any Capital Lease.
“Loan”
shall
mean a loan from a Bank to the Borrowers made pursuant to Section
2.1(a).
“Loan
Document”
shall
mean this Agreement, any Note, any Collateral Document, the Intercreditor
Agreement or any other document, agreement, certificate or instrument now
or
hereafter executed and delivered by the Borrowers or any other Person in
connection with any of the transactions contemplated by any of the foregoing,
as
any of the foregoing may hereafter be amended, modified, or supplemented,
and
“Loan
Documents”
shall
mean, collectively, each of the foregoing.
“Loan
Parties”
means,
collectively, (i) the Borrowers, (ii) each of the SUG EAT Entities until
the
Acquired Business Equity Interests Transfer has been fully consummated, and
(iii) each Subsidiary of the Parent that holds or owns any of the Acquired
Business Equity Interests.
“Majority
Banks”
shall
mean at any time Banks holding more than 50% of the Pro Rata
Percentages.
“Material
Adverse Effect”
shall
mean any material adverse effect on (a) the financial condition, business,
properties, assets, prospects or operations of the Parent and its Subsidiaries
taken as a whole, or (b) the ability of any of the Loan Parties to perform
their
respective obligations under this Agreement, any Note or any other Loan Document
to which it is a party on a timely basis.
“Maturity
Date”
shall
mean February 28, 2007.
“Moody’s”
shall
mean Xxxxx’x Investors Service, Inc.
“NEG
Assets”
shall
mean those “Assets” (as defined in the NEG Purchase Agreement) owned by the
Parent, directly or indirectly through any “Subsidiary” or any “Affiliate” (as
such terms are defined in the NEG Purchase Agreement) of the Parent, and
the
“Stock” (as such term is defined in the NEG Purchase Agreement), all of which
are to be sold pursuant to the NEG Purchase Agreement.
“NEG
Purchase Agreement”
shall
mean the Purchase and Sale Agreement, dated as of February 15, 2006, between
the
Parent and National Grid USA, as the same may be amended, modified or
supplemented from time to time.
“Non-Revolving
Credit Facility Letter of Credit”
shall
mean any Letter of Credit which is not an Existing Revolving Credit Facility
Letter of Credit.
“Note”
or
“Notes”
shall
mean a promissory note or notes, respectively, of the Borrowers, executed
and
delivered under this Agreement.
“Notice
of Borrowing”
shall
have the meaning set forth in Section 2.1(c).
“Obligations”
shall
mean all obligations of the Borrowers to the Agent and each Bank under this
Agreement, the Notes and all other Loan Documents to which it is a
party.
“Officer’s
Certificate”
shall
mean a certificate signed in the name of the Parent or a Subsidiary of the
Parent, as the case may be, by either its President, one of its Vice Presidents,
its Treasurer, its Secretary, or one of its Assistant Treasurers or Assistant
Secretaries.
“Panhandle
Eastern”
shall
mean Panhandle Eastern Pipe Line Company, LP, a Delaware limited
partnership.
“Panhandle
Eastern Refinancing Debt”
shall
mean any Debt of Panhandle Eastern and/or any of its Subsidiaries issued
in
exchange for, or the net proceeds of which are used to extend, refinance,
renew,
replace, defease or refund, any Debt of Panhandle Eastern and/or any of its
Subsidiaries existing as of the Existing Revolving Credit Facility Closing
Date,
provided,
that:
(a) the
principal amount of such Panhandle Eastern Refinancing Debt does not exceed
the
then outstanding principal amount of the Debt so extended, refinanced, renewed,
replaced, defeased or refunded;
(b) the
interest rate or rates to accrue under such Panhandle Eastern Refinancing
Indebtedness do not exceed the lesser of (i) the interest rate or rates then
accruing on the Debt so extended, refinanced, renewed, replaced, defeased
or
refunded or (ii) the prevailing market interest rate or rates which are then
applicable to, and generally available for, Debt which is similar in type,
amount, maturity and other terms to the Indebtedness so extended, refinanced,
renewed, replaced, defeased or refunded;
(c) the
maturities, amortization schedules, covenants, defaults, remedies, collateral
security provisions (or absence thereof) and other terms of such Panhandle
Eastern Refinancing Indebtedness, including without limitation, any restrictions
on the payment by Panhandle Eastern and/or its applicable Subsidiaries of
any
dividends or other shareholder distributions, are in each case the same or
more
favorable to Panhandle Eastern and/or its applicable Subsidiaries as those
in
the Debt so extended, refinanced, renewed, replaced, defeased or refunded;
and
(d) no
Default or Event of Default has occurred and is continuing or would result
from
the issuance or origination of such Panhandle Eastern Refinancing
Indebtedness.
“Parent”
shall
have the meaning set forth in the preamble hereto.
“Partnership
Company” shall
mean any of SRES, REM, Grey Ranch, any SRES Subsidiary or any of their
respective subsidiaries; and “Partnership
Companies”
shall
mean, collectively, SRES, REM, Grey Ranch, the SRES Subsidiaries and their
respective subsidiaries.
“Payment
Office”
shall
mean, with respect to the Agent, the office of the Agent located at its “Address
for Notices” set forth below the name of the Agent on the signature pages hereof
or such other office of the Agent as the Agent may from time to time specify
to
the Borrowers and the Banks.
“Permitted
Subordinated Lien”
shall
mean the Lien granted by each of the SUG EAT Entities in favor of ESSI in
all of
their respective rights title and interest in and to the SUG EAT Entities
Collateral pursuant to the terms of the SUG EAT Entities Loan Documents,
which
Lien shall be at all times fully subordinated to the Liens granted in favor
of
the Agent in such SUG EAT Entities Collateral pursuant to the Collateral
Documents and subject to the terms and conditions of the Intercreditor
Agreement.
“Person”
shall
mean an individual, partnership, joint venture, corporation, joint stock
company, bank, trust, unincorporated organization and/or a government or
any
department or agency thereof.
“PGEnergy
Assets”
shall
mean those “Assets” (as defined in the PGEnergy Purchase Agreement) owned by the
Parent, directly or indirectly through PG Energy Services, Inc., a Pennsylvania
corporation, and the Equity Interests in PG Energy Services Inc., all of
which
are to be sold pursuant to the PGEnergy Purchase Agreement.
“PGEnergy
Purchase Agreement”
shall
mean the Purchase and Sale Agreement, dated as of January 26, 2006, between
the
Parent and UGI Corporation, as the same may be amended, modified or supplemented
from time to time.
“Plan”
shall
mean any plan subject to Title IV of ERISA and maintained for employees of
the
Parent or of any member of a “controlled group of corporations,” as such term is
defined in the Code, of which the Parent or any of its Subsidiaries is a
member,
or any such plan to which the Parent or any of its Subsidiaries is required
to
contribute on behalf of its employees.
“Pledge
Agreements”
shall
mean, collectively, (i) the Parent Pledge Agreement to be executed and delivered
on the Closing Date by the Parent and the Agent, substantially in the form
of
Exhibit
D-1,
as the
same may be amended, supplemented or otherwise modified from time to time,
(ii)
the Pledge Agreement to be executed and delivered on the Closing Date by
the SUG
EAT Entities and the Agent, substantially in the form of Exhibit
D-2,
as the
same may be amended, supplemented or otherwise modified from time to time
(the“SUG
EAT Entities Pledge Agreement”)
and
(iii) any pledge agreement executed and delivered pursuant to Section
9.13.
“Prime
Rate”
shall
mean, on any day, the rate as
publicly announced from time to time by JPMorgan Chase Bank as
being
its “prime rate” for that day. Without notice to the Borrowers or any other
Person, the Prime Rate shall change automatically from time to time as and
in
the amount by which said Prime Rate shall fluctuate, with each such change
to be
effective as of the date of each change in such Prime Rate. The Prime Rate
is a
reference rate and does not necessarily represent the lowest or best rate
actually charged to any customer. The Agent may make commercial or other
loans
at rates of interest at, above or below the Prime Rate.
“Prior
Acquisitions”
shall
mean collectively the Parent’s previous acquisitions of and mergers with Fall
River Gas Company, Providence Energy Corporation and Valley Resources,
Inc.
“Pro-Rata
Percentage”
shall
mean with respect to any Bank, a fraction (expressed as a percentage), the
numerator of which shall be the amount of such Bank’s Credit Exposure and the
denominator of which shall be the aggregate amount of all the Credit Exposure,
as adjusted from time to time in accordance with this Agreement.
“Property”
shall
mean any interest or right in any kind of property or asset, whether real,
personal, or mixed, owned or leased, tangible or intangible, and whether
now
held or hereafter acquired.
“Qualified
Exchange Accommodation
Agreement” shall
mean the Qualified Exchange Accommodation Agreement, dated as of February
27,
2006, by and among SUG EAT Inc., SUG EAT LLC and the Parent.
“Qualified
Transaction”
shall
mean, collectively, the following transactions so long as the Acquired Business
Equity Interests Transfer has not been consummated: the sale by the Parent
of
each of the PGEnergy Assets and the NEG Assets (each an “LDC
Sale”)
and
the contemporaneous assignment to CDEC of the Parent’s rights to all the
proceeds from such sale (such proceeds from each LDC Sale being referred
to as
the “LDC
Proceeds”).
Immediately upon the consummation of any LDC Sale, the Parent will require
and
direct CDEC to immediately transfer or otherwise distribute to the SUG EAT
Inc.
the LDC Proceeds received by CDEC from such LDC Sale, and SUG EAT Inc. shall
then immediately make a corresponding partial prepayment of the SUG EAT Entities
Loan in an amount equal to such LDC Proceeds to ESSI. Upon the earlier of
(i)
the consummation of the second LDC Sale or (ii) the Safe Harbor Transfer
Date,
the Parent shall direct CDEC to require the SUG EAT Entities to transfer
to one
or more wholly-owned Subsidiaries (other than the SUG Partnership Entities)
designated by the Parent the Acquired Business Equity Interests and all related
Collateral described in the SUG EAT Entities Pledge Agreement free and clear
of
all Liens other than the Liens in favor of the Agent created under the
Collateral Documents. The Borrowers shall apply any LDC Proceeds received
by
them or any of their Subsidiaries in accordance with Section
4.1(b)(iv).
“Qualifying
Assets”
shall
mean (i) equity interests owned one hundred percent (100%) by the Parent
in
entities engaged primarily in one or more of the Parent’s lines of business
described in Section 7.15 (singly, a “Qualified
Entity,”
collectively, “Qualified
Entities”),
or
productive assets used in one or more of such lines of business; and (ii)
equity
interests of less than one hundred percent (100%) owned by the Parent in
one or
more Qualifying Entities, provided
that at
any time the aggregate amount of the Parent’s investment in Qualifying Assets
described in clause (ii) that are then held by the Parent as of the applicable
determination date (measured by the aggregate purchase price paid therefor,
including the aggregate amount of Debt assumed or deemed incurred by the
Parent
in connection with such acquisitions) does not exceed twenty percent (20%)
of
the Consolidated Net Worth of the Parent and its Subsidiaries as of the
applicable determination date.
“Rabbi
Trusts”
shall
mean those four (4) certain non-qualified deferred compensation irrevocable
trusts existing as of the Closing Date, previously established by the Parent
for
the benefit of its executive employees, so long as the assets in each of
such
trusts which have not yet been distributed to one or more executive employees
of
the Parent remain subject to the claims of the Parent’s general
creditors.
“Rate
Period”
shall
mean the period of time for which the Eurodollar Rate shall be in effect
as to
any Eurodollar Rate Loan commencing on the date such Loan was made or such
Loan
was converted to or continued as an Eurodollar Rate Loan, as the case may
be,
and ending on the date one, two, three or six months thereafter as specified
in
the applicable Notice of Borrowing and subject to the provisions of Sections
2.2
and 2.3; provided,
however,
that
any Rate Period that would otherwise end on a day which is not a Business
Day
shall be extended to the next succeeding Business Day unless such Business
Day
falls in another calendar month, in which case such Rate Period shall end
on the
next preceding Business Day.
“Release”
shall
mean a “release”,
as
such term is defined in CERCLA.
“REM”
shall
have the meaning set forth in the recitals hereto.
“Restricted
Payment”
shall
mean, with respect to any Person, such Person’s declaration or payment of any
dividend on, or purchase or agreement to purchase any of, or making of any
other
distribution with respect to, any of its Equity Interests stock, except,
in the
case of the Parent only, (i) any such dividend, purchase or distribution
consisting solely of capital stock of the Parent and (ii) any dividend or
interest paid on or with respect to the Parent’s Structured Securities to the
extent that such amounts are included in Cash Interest Expense.
“Safe
Harbor Transfer Date”
shall
mean August 28, 2006.
“S&P”
shall
mean Standard & Poor’s Ratings Group.
“Secured
Obligations”
shall
mean the “Secured Obligations” as defined in Section 1 of the Pledge
Agreements.
“Secured
Parties”
shall
mean the Agent and the Banks.
“Securities
Act”
shall
have the meaning set forth in Section 13.1.
“Sellers”
shall
have the meaning set forth in the recitals hereto.
“Senior
Funded Debt”
shall
mean Funded Debt of the Parent excluding Debt that is contractually subordinated
in right of payment to any other Debt.
“Senior
Notes”
shall
mean, collectively, (a) the $475,000,000 of 7.6% Senior Notes of the Parent
previously placed with investors on or about January 31, 1994, (b) the
$300,000,000 of 8.25% Senior Notes of the Parent previously placed with
investors on or about November 3, 1999, (c) the $125,000,000 of the 2008
Senior
Notes, and (d) the $100,000,000 of 4.375% Senior Notes of the Parent previously
placed with investors on or about February 11, 2005, as each such Senior
Notes
may be amended, modified, or supplemented from time to time in accordance
with
the terms of this Agreement; and “Senior
Note”
shall
mean each such note individually.
“Xxx
Xxxxxxxxxx Acquired
Business”
shall
have the meaning set forth in the recitals hereto.
“Xxx
Xxxxxxxxxx Acquisition”
shall
have the meaning set forth in the recitals hereto.
“Xxx
Xxxxxxxxxx Acquisition Agreement”
shall
have the meaning set forth in the recitals hereto.
Xxx
Xxxxxxxxxx Acquisition
Agreement Assignment”
shall
have the meaning set forth in the recitals hereto.
“Xxx
Xxxxxxxxxx Acquisition Documents”
shall
have the meaning set forth in the recitals hereto.
“Significant
Property”
shall
mean at any time property or assets of the Parent or any of its Subsidiaries
having a book value (net of accumulated depreciation taken in accordance
with
GAAP) of at least $5,000,000.00 or that contributed (or is an integrated
physical portion of an assemblage of assets that contributed) at least 5%
of the
gross income of the owner thereof for the fiscal quarter most recently
ended.
“Southern
Union Panhandle”
shall
have the meaning set forth in the recitals hereto.
“Southern
Union Trust”
shall
mean any of those certain Delaware business trusts organized for the sole
purpose of purchasing Subordinated Debt Securities constituting a portion
of,
and described in the definition of, Structured Securities and issuing the
Preferred Securities and Common Securities also constituting a portion of,
and
described in the definition of, Structured Securities, and having no assets
other than the Parent’s Subordinated Debt Securities, the Guaranties (as
described in the definition of Structured Securities) and the proceeds thereof.
Southern Union Trusts shall be considered to be Subsidiaries for purposes
hereof
so long as their affairs are consolidated under GAAP and for federal income
tax
purposes with the affairs of the Parent.
“SRCG”
shall
have the meaning set forth in the recitals hereto.
“SRES”
shall
have the meaning set forth in the recitals hereto.
“SRES
Subsidiaries”
shall
mean, collectively, Leapartners, SRCG-West Texas Gathering Company, Inc.,
a
Texas corporation, Mi Vida Genpar, L.L.C., a Texas limited liability company,
Xxx Xxxxxxxxxx Pipeline, Ltd., a Texas limited partnership, West Texas Gathering
Company, a Delaware corporation, and Xxx Xxxxxxxxxx Gas Pipeline, Ltd., a
Texas
limited partnership.
“Standby
Letter of Credit”
shall
mean any standby letter of credit issued to support obligations (contingent
or
otherwise) of the Parent.
“Structured
Securities”
shall
mean collectively (a) the Subordinated Debt Securities, the Guaranties, the
Common Securities and the Preferred Securities of the Southern Union Trusts,
all
as described and defined in the Registration Statement on Form S-3 filed
by the
Parent with the Securities and Exchange Commission on March 25, 1995, and
(b)
subordinated debt securities, guaranties, common securities and/or preferred
securities issued in connection with the consummation of the Prior Acquisitions
in an aggregate face amount of not more than $150,000,000 upon terms and
conditions substantially similar in all material respects to the terms and
conditions described and defined in such Registration Statement on Form S-3
filed by the Parent with the Securities and Exchange Commission on March
25,
1995. For all purposes of this Agreement, the amounts payable by Southern
Union
Trusts under the Preferred Securities and Common Securities (or similar
securities provided for under subclause (b) above) and the amounts payable
by
the Parent under the Subordinated Debt Securities or the Guaranties (or similar
securities provided for under subclause (b) above) shall be treated without
duplication, it being recognized that the amounts payable by Southern Union
Trusts are funded with payments made or to be made by the Parent to Southern
Union Trusts and are also guaranteed by the Parent under the Guaranties
described in the S-3 mentioned above (or similar guaranties provided for
under
subclause (b) above).
“Subsidiary”
of
a
Person shall mean a corporation, partnership, limited liability company or
other
business entity of which a majority of the shares of securities or other
interests having ordinary voting power for the election of directors or other
governing body (other than securities or interests having such power only
by
reason of the happening of a contingency) are at the time beneficially owned,
or
the management of which is otherwise controlled, directly, or indirectly
through
one or more intermediaries, or both, by such Person. Solely for purposes
of this
Agreement and the other Loan Documents, each of the SUG Partnership Entities
shall be deemed a “Subsidiary” of the Parent. Notwithstanding the foregoing in
this definition of “Subsidiary”, SUG EAT Inc. shall be deemed a “Subsidiary” of
the Parent solely for purposes of Section 4.1(b) and each of the definitions
of
Asset Sale, Equity Issuance and Debt Issuance. Notwithstanding the fact that
the
management of Cross Country is or may be controlled by the Parent, neither
Cross
Country nor any of its subsidiaries shall be deemed to constitute a Subsidiary
of the Parent for purposes of this Agreement so long as the Parent does not
beneficially own, directly, or indirectly, a majority of the shares of
securities or other interests in Cross Country having ordinary voting power
for
the election of directors or other governing body (other than securities
or
interests having such power only by reason of the happening of a
contingency).
“SUGC
”
shall
have the meaning set forth in the recitals hereto.
“SUG
EAT Entities”
shall
mean, collectively, SUG EAT LLC and SUG EAT Inc.
“SUG
EAT Entities Collateral”
shall
mean “Collateral” as such term is defined in the SUG EAT Entities Pledge
Agreement.
“SUG
EAT Entities Loan”
shall
have the meaning set forth in the recitals hereto.
“SUG
EAT Entities Loan Documents”
shall
mean, collectively, (a) the Promissory Note dated March 1, 2006, between
the SUG
EAT Entities, as payors, and ESSI, as payee, (b) the pledge agreement, dated
as
of March 1, 2006, by and between the SUG EAT Entities and ESSI and (c) any
issuer control agreements executed to perfect the lien created by the pledge
agreement referred to in clause (b) above.
“SUG
EAT Entities Permitted Activities”
shall
have the meaning set forth in Section 11.1(O).
“SUG
EAT Entities Pledge Agreement”
shall
have the meaning set forth in the definition of Pledge Agreements.
“SUG
EAT Entities Transaction Document”
shall
mean (a) the SUG EAT Entities Loan Documents, (b) the Qualified Exchange
Accommodation Agreement, (c) the Management Agreement, or (d) the Xxx Xxxxxxxxxx
Acquisition Agreement Assignment; and “SUG
EAT Entities Transaction Documents”
shall
mean, collectively, each of the foregoing.
“SUG
EAT Inc.”
shall
mean SUG EAT, Inc., a Delaware corporation and a direct wholly- owned subsidiary
of CDEC.
“SUG
EAT LLC”
shall
mean SUG EAT, LLC, a Delaware limited liability company and a direct
wholly-owned subsidiary of SUG EAT Inc.
“SUG
Management Agreement”
shall
mean the Management Agreement, dated as of March 1, 2006 by and between SUG
EAT
LLC and Southern Union Panhandle pursuant to which, among other things, Southern
Union Panhandle is engaged or otherwise appointed the sole manager of SUG
EAT
LLC.
“SUG
Partnership Entities”
shall
mean the Partnership Companies and SUG EAT LLC.
“SUG
Purchasers”
shall
have the meaning set forth in the recitals hereto.
“Transferee
Subsidiary”
shall
have the meaning set forth in Section 9.13.
“Trunkline
LNG Holdings”
shall
mean CMS Trunkline LNG Holdings, LLC, a Delaware limited liability
company.
“2003
Equity Units”
shall
mean the 2,500,000 equity units issued by the Parent June 11, 2003, with
each
such equity unit consisting of a forward stock purchase contract for the
purchase of shares of the Parent’s common stock and a 2.75% senior note of the
Parent due August 16, 2008 (the “2008
Senior Notes”),
which
2008 Senior Notes were issued pursuant to Supplemental Indenture No. 1, dated
as
of June 11, 2003 between the Parent and JPMorgan Chase Bank, N.A., as trustee
(the “2003
Supplemental Indenture”).
“2003
Supplemental Indenture”
shall
have the meaning set forth in the definition of 2003 Equity Units.
“2008
Senior Notes”
shall
have the meaning in the definition of 2003 Equity Units.
“Type”
shall
mean, with respect to any Loan, any Alternate Base Rate Loan or any Eurodollar
Rate Loan.
1.2 Terms
Generally.
The
definitions of terms herein shall apply equally to the singular and plural
forms
of the terms defined. Whenever the context may require, any pronoun shall
include the corresponding masculine, feminine and neuter forms. The words
“include,” “includes” and “including” shall be deemed to be followed by the
phrase “without limitation.” Unless the context requires otherwise (a) any
definition of or reference to any Loan Document, agreement, instrument or
other
document herein shall be construed as referring to such agreement, instrument
or
other document as from time to time amended, supplemented or otherwise modified
(subject to any restrictions on such amendments, supplements or modifications
set forth herein), (b) any reference herein to any Person shall be
construed to include such Person’s successors and assigns, (c) the words
“herein,” “hereof” and “hereunder,” and words of similar import, shall be
construed to refer to this Agreement in its entirety and not to any particular
provision hereof, (d) all references herein to Articles, Sections, Exhibits
and Schedules shall be construed to refer to Articles and Sections of, and
Exhibits and Schedules to, this Agreement, and (e) any reference to any law
or regulation herein shall refer to such law or regulation as amended, modified
or supplemented from time to time.
2. THE
LOANS
2.1 The
Loans
(a) Subject
to the terms and conditions and relying upon the representations and warranties
of the Borrowers herein set forth, each Bank severally agrees to make a single
Loan to the Borrowers on the Closing Date in a principal amount not to exceed
the amount set opposite such Bank’s name on Schedule
2.1(a)
(such
Bank’s “Commitment”).
The
Borrowers may not reborrow any Loan or portion thereof that has been repaid
or
prepaid.
(b) (i)The
Borrowers shall execute and deliver to the Agent for each Bank to evidence
the
Loan made by each Bank under such Bank’s Commitment, a Note, which shall be: (i)
dated the date of the Closing Date; (ii) in the principal amount of such
Bank’s
Loan made by it on the Closing Date; (iii) in substantially the form
attached hereto as Exhibit
A,
with
blanks appropriately filled; (iv) payable to the order of such Bank on the
Maturity Date; and (v) subject to acceleration upon the occurrence of an
Event
of Default.
(ii) Each
Loan
shall bear interest on the unpaid principal amount thereof from time to time
outstanding at the rate per annum determined as specified in
Sections 2.2(a), 2.2(b), 2.3(b) and 2.3(c), and accrued interest on each
Loan shall be payable in arrears on each Interest Payment Date for such Loan,
commencing with the first Interest Payment Date following the date of each
Loan;
provided,
however,
that
(i) interest accrued pursuant to Section 2.2(b) shall be payable on
demand, (ii) in the event of any repayment or prepayment of any Loan,
accrued interest on the principal amount repaid or prepaid shall be payable
on
the date of such repayment or prepayment and (iii) in the event of any
conversion of any Eurodollar Rate Loan prior to the end of the current Rate
Period therefor, accrued interest on such Loan shall be payable on the effective
date of such conversion.
(c) Each
Loan
to be made pursuant to Section 2.1(a), each conversion of Loans from one
Type to
the other, and each continuation of Eurodollar Rate Loans or Alternate Base
Rate
Loans shall be: (i) in the case of any Eurodollar Rate Loan, in a principal
amount of not less than $10,000,000.00 or an integral multiple of $5,000,000.00
in excess thereof; or (ii) in the case of any Alternate Base Rate Loan, in
a
principal amount of not less than $10,000,000.00 or an integral multiple
of
$5,000,000.00 in excess thereof, and, at the option of the Borrowers, any
Borrowing, continuation or conversion under this Section 2.1(c) may be comprised
of two or more such Loans bearing different rates of interest. Each Borrowing
under Section 2.1(a), each conversion of Loans from one Type to the other,
and
each continuation of Eurodollar Rate Loans or Alternate Base Rate Loans shall
be
made upon prior notice from the Borrowers to the Agent in the form attached
hereto as Exhibit
B
(the
“Notice
of Borrowing”)
delivered to the Agent not later than 11:00 am (New York City time): (i)
on the
third Business Day prior to the requested date of a Borrowing of, conversion
to
or continuation of Eurodollar Rate Loans or of any conversion of Eurodollar
Rate
Loans to Alternate Base Rate Loans; and (ii) on the requested date of a
Borrowing or continuation of Alternate Base Rate Loans. Each Notice of Borrowing
shall be irrevocable and shall specify: (i) whether the Borrowers are requesting
a Borrowing on the Closing Date, a conversion of Loans from one Type to the
other, or a continuation of Eurodollar Rate Loans or Alternative Base Rate
Loans, (ii) the requested date of the Borrowing, conversion or continuation,
as
the case may be (which shall be a Business Day), (iii) the principal amount
of
Loans to be borrowed, converted or continued, (iv) the Type of Loans to be
borrowed or to which existing Loans are to be converted, (v) if applicable,
the
duration of the Rate Period with respect thereto and the Expiration Date
of such
Rate Period, and (vi) in the case of the Borrowing pursuant to Section 2.1(a),
the demand deposit account into which the proceeds of the borrowing are to
be
deposited by the Agent. If the Borrowers fail to specify a Type of Loan in
a
Notice of Borrowing or if the Borrowers fail to give a timely notice requesting
a conversion or continuation, then the applicable Loans shall be made as,
converted to, or continued as Alternate Base Rate Loans. Any such automatic
conversion to Alternate Base Rate Loans shall be effective as of the last
day of
the Rate Period then in effect with respect to the applicable Loans. If the
Borrowers request a Borrowing of, conversion to, or continuation of Eurodollar
Rate Loans in any such Notice of Borrowing, but fails to specify an Rate
Period,
it will be deemed to have specified an Rate Period of one month. The Borrowers
may give the Agent telephonic notice by the required time of any proposed
Borrowing, continuation or conversion under this Section 2.1(c); provided
that
such telephonic notice shall be confirmed in writing by delivery to the Agent
as
promptly as practicable (but in no event later than the date relating to
any
such Borrowing, conversion or continuation) of a Notice of Borrowing. Neither
the Agent nor any Bank shall incur any liability to any of the Borrowers
in
acting upon any telephonic notice referred to above which the Agent believes
in
good faith to have been given by the Borrowers, or for otherwise acting in
good
faith under this Section 2.1(c). After giving effect to all Borrowings, all
conversions of Loans from one Type to the other, and all continuations of
Loans
as the same Type, there shall not be more than eight Rate Periods in effect.
(d) Following
receipt of a Notice of Borrowing in respect of a Borrowing under Section
2.1(a)
or conversion or continuation of Types of Loans as provided in Section 2.1(c)
(and if no timely notice of a conversion or continuation is provided by the
Borrowers, the Agent shall notify each Bank of the details of any automatic
conversion to Alternate Base Rate Loans described in Section 2.1(c)), the
Agent
shall promptly notify each Bank of the applicable interest rate under
Section 2.2. With respect to the Loan to be made by each Bank pursuant to
Section 2.1(a), each Bank shall, before 11:00 am (New York City time) on
the
Closing Date, make the amount of such Loan available to the Agent by wire
transfer in same day funds in dollars, at the Agent’s Payment Office. After the
Agent’s receipt of such funds and upon fulfillment of the applicable conditions
set forth in Section 8, on the Closing Date, the Agent shall make the
Borrowing available to the Borrowers at the Agent’s Payment Office in
immediately available funds and, to the extent requested in the Notice of
Borrowing, deposit or otherwise credit such funds to the account designated
in
such Notice of Borrowing. Each Bank shall post on a schedule attached to
its
Note: (i) the date and principal amount of the Loan made under such Note;
(ii) the rate of interest each such Loan will bear; and (iii) each payment
of principal thereon; provided,
however,
that
any failure of such Bank so to xxxx such Note shall not affect the Borrowers,
obligations thereunder or hereunder; and provided further
that
such Bank’s records as to such matters shall be controlling whether or not such
Bank has so marked such Note. Any deposit to a demand deposit account by
the
Agent pursuant to a request (whether written or oral) believed by the Agent
to
be an authorized request by the Borrowers for a Loan hereunder shall be deemed
to be a Loan hereunder for all purposes with the same effect as if the Borrowers
had in fact requested the Agent to make such Loan.
(e) Unless
the Agent shall have received notice from a Bank prior to the date of the
Borrowing of the Loans pursuant to Section 2.1(a) that such Bank will not
make
available to the Agent the amount of the Loan to be made by such Bank hereunder,
the Agent may assume that such Bank has made such portion available to the
Agent
on the Closing Date in accordance with this Section 2.1 and the Agent may,
in
reliance upon such assumption, make available to the Borrowers on the Closing
Date a corresponding amount. If and to the extent that such Bank shall not
have
so made such amount available to the Agent, such Bank (severally) and the
Borrowers (jointly and severally) agree to repay to the Agent forthwith on
demand such corresponding amount together with interest thereon, for each
day
from the date such amount is made available to the Borrowers until the date
such
amount is repaid to the Agent, (i) in the case of the Borrowers, at the interest
rate applicable at the time to the Loans comprising such borrowing, and (ii)
in
the case of such Bank, at the Federal Funds Rate. If such Bank shall repay
to
the Agent such corresponding amount, such amount so repaid shall constitute
such
Bank’s Loan as part of such Borrowing for purposes of this
Agreement.
(f) The
failure of any Bank to make its Loan to be made by it on the Closing Date
pursuant to Section 2.1(a) shall not relieve any other Bank of its obligation,
if any, hereunder to make its Loan on the Closing Date, but no Bank shall
be
responsible for the failure of any other Bank to make the Loan to be made
by
such other Bank on the Closing Date.
(g) Except
as
otherwise provided herein, a Eurodollar Rate Loan may be continued or converted
only on the last day of a Rate Period for such Eurodollar Rate Loan. During
the
existence of a Default, no Loans may be requested as, converted to or continued
as Eurodollar Rate Loans without the consent of the Majority Banks.
2.2 Interest
Rate Determination
(a) (i)Except
as
specified in Sections 2.3(b), Alternate Base Rate Loans shall bear interest
on
the unpaid principal amount thereof from time to time outstanding, until
maturity, at a rate per annum equal to the lesser of (A) the Alternate Base
Rate
in effect from time to time for such Loans or (B) the Highest Lawful Rate.
(ii) Except
as
specified in Sections 2.3(b) and 2.3(c), Eurodollar Rate Loans shall bear
interest on the unpaid principal amount thereof from time to time outstanding,
until maturity, at a rate per annum equal to the lesser of (A) the Eurodollar
Rate for the Rate Period in effect for such Borrowing of such Loans in effect
from time to time or (B) the Highest Lawful Rate.
(iii) All
interest hereunder shall be calculated based on a year of 360 days in the
case
of the Eurodollar Rate or the Alternate Base Rate based on the Federal Funds
Rate and a year of 365 or 366 days, as the case may be, in the case of the
Alternate Base Rate based on the Prime Rate, and in each case shall be payable
for the actual number of days elapsed (including the first day but excluding
the
last day). The applicable Alternate Base Rate or Eurodollar Rate shall be
determined by the Agent in accordance with the provisions of this Agreement
and
such determination shall be conclusive absent manifest error.
(b) Any
principal, interest, fees or other amount owing hereunder, under any Note
or
under any other Loan Document that is not paid when due (whether at stated
maturity, by acceleration or otherwise) shall bear interest at a rate per
annum
equal to the lesser of (i) two percent (2%) above the Alternate Base Rate
in
effect from time to time or (ii) the Highest Lawful Rate.
2.3 Additional
Interest Rate Provisions
(a) The
respective Note of each Bank may be held by the applicable Bank for the account
of its respective Domestic Lending Office or its respective Eurodollar Lending
Office, and may be transferred from one to the other from time to time as
each
Bank may determine.
(b) If
the
Borrowers shall have chosen the Eurodollar Rate in a Notice of Borrowing
and
prior to the requested date of Borrowing, conversion or continuation, any
Bank
in good faith determines (which determination shall be conclusive) that (i)
deposits in Dollars in the principal amount of such Eurodollar Rate Loan
are not
being offered to the Eurodollar Lending Office of such Bank in the Eurodollar
interbank market selected by such Bank in its sole discretion in good faith
or
(ii) adequate and reasonable means do not exist for ascertaining the chosen
Eurodollar Rate in respect of such Eurodollar Rate Loan or (iii) the Eurodollar
Rate for any Rate Period for such Eurodollar Rate Loan will not adequately
reflect the cost to such Bank of making or maintaining such Eurodollar Rate
Loan
for such Rate Period, then such Bank will so notify the Borrowers and the
Agent
and such Eurodollar Rate shall not become effective as to such Eurodollar
Rate
Loan on such Borrowing Date or at any time thereafter until such time thereafter
as the Borrowers receive notice from the Agent that the circumstances giving
rise to such determination no longer apply.
(c) Anything
in this Agreement to the contrary notwithstanding, if at any time any Bank
in
good faith determines (which determination shall be conclusive) that the
introduction of or any change in any applicable law, rule or regulation or
any
change in the interpretation or administration thereof by any governmental
or
other regulatory authority charged with the interpretation or administration
thereof shall make it unlawful for the Bank (or the Eurodollar Lending Office
of
such Bank) to maintain or fund any Eurodollar Rate Loan, such Bank shall
give
notice thereof to the Borrowers and the Agent. With respect to any Eurodollar
Rate Loan which is outstanding when such Bank so notifies the Borrowers,
upon
such date as shall be specified in such notice the Rate Period shall end
and the
lesser of (i) the Alternate Base Rate or (ii) the Highest Lawful Rate shall
commence to apply in lieu of the Eurodollar Rate in respect of such Eurodollar
Rate Loan and shall continue to apply unless and until the Borrowers change
the
rate as provided in Section 2.1(c). No more than five (5) Business Days after
such specified date, the Borrowers shall, jointly and severally, pay to such
Bank (x) accrued and unpaid interest on such Eurodollar Rate Loan at the
Eurodollar Rate in effect at the time of such notice to but not including
such
specified date plus (y) such amount or amounts (to the extent that such amount
or amounts would not be usurious under applicable law) as may be necessary
to
compensate such Bank for any direct or indirect costs and losses incurred
by it
(to the extent that such amounts have not been included in the Additional
Costs
in calculating such Eurodollar Rate), but otherwise without penalty. If notice
has been given by such Bank pursuant to the foregoing provisions of this
Section
2.3(c), then, unless and until such Bank notifies the Borrowers that the
circumstances giving rise to such notice no longer apply, such Eurodollar
Rate
shall not again apply to such Loan or any other Loan and the obligation of
such
Bank to continue any Eurodollar Rate Loan as a Eurodollar Rate Loan shall
be
suspended. Any such claim by such Bank for compensation under clause (y)
above
shall be accompanied by a certificate setting forth the computation upon
which
such claim is based, and such certificate shall be conclusive and binding
for
all purposes, absent manifest error.
(d) EACH
BORROWER JOINTLY AND SEVERALLY WILL INDEMNIFY EACH BANK AGAINST, AND REIMBURSE
EACH BANK ON DEMAND FOR, ANY LOSS (INCLUDING LOSS OF REASONABLY ANTICIPATED
PROFITS DETERMINED USING REASONABLE ATTRIBUTION AND ALLOCATION METHODS),
OR
REASONABLE COST OR EXPENSE INCURRED OR SUSTAINED BY SUCH BANK (INCLUDING
WITHOUT
LIMITATION, ANY LOSS OR EXPENSE INCURRED BY REASON OF THE LIQUIDATION OR
REEMPLOYMENT OF DEPOSITS OR OTHER FUNDS ACQUIRED BY SUCH BANK TO FUND OR
MAINTAIN ANY EURODOLLAR RATE LOAN) AS A RESULT OF (i) ANY ADDITIONAL COSTS
INCURRED BY SUCH BANK; (ii) ANY CONTINUATION, CONVERSION, PAYMENT, PREPAYMENT
OR
REPAYMENT (WHETHER AUTHORIZED OR REQUIRED HEREUNDER OR OTHERWISE) OF ALL
OR A
PORTION OF ANY LOAN ON A DAY OTHER THAN THE EXPIRATION DATE OF A RATE PERIOD
FOR
SUCH LOAN; (iii) ANY PAYMENT OR PREPAYMENT (WHETHER REQUIRED HEREUNDER OR
OTHERWISE) OF ANY LOAN MADE AFTER THE DELIVERY OF A NOTICE OF BORROWING BUT
BEFORE THE BORROWING DATE IF SUCH PAYMENT OR PREPAYMENT PREVENTS THE PROPOSED
BORROWING FROM BECOMING FULLY EFFECTIVE; (iv) AFTER RECEIPT BY THE AGENT
OF A
NOTICE OF BORROWING, THE FAILURE OF ANY LOAN TO BE MADE OR EFFECTED BY SUCH
BANK
DUE TO ANY CONDITION PRECEDENT TO A BORROWING NOT BEING SATISFIED BY THE
BORROWERS OR DUE TO ANY OTHER ACTION OR INACTION OF THE BORROWERS, OR (v)
ANY
FAILURE BY ANY
BORROWER (FOR A REASON OTHER THAN THE FAILURE OF A BANK TO MAKE A LOAN) TO
PREPAY, BORROW, CONTINUE OR CONVERT ANY LOAN OTHER THAN AN ALTERNATE BASE
RATE
LOAN ON THE DATE OR IN THE AMOUNT NOTIFIED BY THE BORROWERS. ANY BANK DEMANDING
PAYMENT UNDER THIS SECTION 2.3(d) SHALL DELIVER TO THE BORROWERS AND THE
AGENT A
STATEMENT REASONABLY SETTING FORTH THE AMOUNT AND MANNER OF DETERMINING SUCH
LOSS, COST OR EXPENSE. THE FACTS SET FORTH IN SUCH STATEMENT SHALL BE CONCLUSIVE
AND BINDING FOR ALL PURPOSES, ABSENT MANIFEST ERROR.
(e) If,
after
the date of this Agreement, any Bank shall have determined that the adoption
of
any applicable law, rule, guideline, interpretation or regulation regarding
capital adequacy, or any change therein, or any change in the interpretation
or
administration thereof by any governmental authority, central bank or comparable
agency charged with the interpretation or administration thereof, or compliance
by such Bank with any request or directive regarding capital adequacy (whether
or not having the force of law) of any such authority, central bank or
comparable agency, has or would have the effect of reducing the rate of return
on such Bank’s capital as a consequence of its obligations hereunder and under
similar lending arrangements to a level below that which such Bank could
have
achieved but for such adoption, change or compliance (taking into consideration
such Bank’s policies with respect to capital adequacy) by an amount deemed by
such Bank to be material then the Borrowers jointly and severally shall pay
to
such Bank such additional amount or amounts as will compensate such Bank
for
such reduction.
(f) A
certificate of such Bank setting forth such amount or amounts as shall be
necessary to compensate such Bank as specified in subparagraph (e) above
shall
be delivered as soon as practicable to the Borrowers (with a copy thereof
to the
Agent) and to the extent determined in accordance with subparagraph (e) above
shall be conclusive and binding, absent manifest error. The Borrowers jointly
and severally shall pay such Bank the amount shown as due on any such
certificate within fifteen (15) days after such Bank delivers such certificate.
In preparing such certificate, such Bank may employ such assumptions and
allocations (consistently applied with respect to advances made by such Bank
or
commitments by such Bank to make advances) of costs and expenses as it shall
in
good xxxxx xxxx reasonable and may use any reasonable averaging and attribution
method (consistently applied with respect to advances made by such Bank or
commitments by such Bank to make advances).
3. JOINT
AND SEVERAL LIABILITY OF BORROWERS
3.1 Joint
and Several Liability of Borrowers
(a) Each
Borrower is accepting joint and several liability hereunder and under the
other
Loan Documents in consideration of the financial accommodations to be provided
by the Agent and the Banks under this Agreement, for the mutual benefit,
directly and indirectly, of each Borrower and in consideration of the
undertakings of the other Borrower to accept joint and several liability
for the
Obligations.
(b) Each
Borrower, jointly and severally, hereby irrevocably and unconditionally accepts,
not merely as a surety but also as a co-debtor, joint and several liability
with
the other Borrower, with respect to the payment and performance of all of
the
Obligations (including any Obligations arising under this Section 3.1), it
being
the intention of the parties hereto that all the Obligations shall be the
joint
and several obligations of each Borrower without preferences or distinction
among them.
(c) If
and to
the extent that any Borrower shall fail to make any payment with respect
to any
of the Obligations as and when due or to perform any of the Obligations in
accordance with the terms thereof, then in each such event the other Borrower
will make such payment with respect to, or perform, such
Obligation.
(d) The
obligations of each Borrower under the provisions of this Section 3.1 constitute
the absolute and unconditional, full recourse obligations of each Borrower
enforceable against each such Borrower.
(e) Except
as
otherwise expressly provided in this Agreement: (i) each Borrower hereby
waives
notice of acceptance of its joint and several liability, notice of any Loans
under or pursuant to this Agreement, notice of the occurrence of any Default,
Event of Default, or of any demand for any payment under this Agreement,
notice
of any action at any time taken or omitted by any Agent or any Borrower under
or
in respect of any of the Obligations, any requirement of diligence or to
mitigate damages and, generally, to the extent permitted by applicable law,
all
demands, notices and other formalities of every kind in connection with this
Agreement (except as otherwise provided in this Agreement); and (ii) each
Borrower hereby assents to, and waives notice of, any extension or postponement
of the time for the payment of any of the Obligations, the acceptance of
any
payment of any of the Obligations, the acceptance of any partial payment
thereon, any waiver, consent or other action or acquiescence by the Agent
or any
Bank at any time or times in respect of any default by any Borrower in the
performance or satisfaction of any term, covenant, condition or provision
of
this Agreement, any and all other indulgences whatsoever by the Agent or
any
Bank in respect of any of the Obligations, and the taking, addition,
substitution or release, in whole or in part, at any time or times, of any
security for any of the Obligations or the addition, substitution or release,
in
whole or in part, of any Borrower.
(f) Without
limiting the generality of the foregoing, each Borrower assents to any other
action or delay in acting or failure to act on the part of the Agent or any
Bank
with respect to the failure by any Borrower to comply with any of its respective
Obligations, including any failure strictly or diligently to assert any right
or
to pursue any remedy or to comply fully with applicable laws, statutes, rules
or
regulations, which might, but for the provisions of this Section 3.1 afford
grounds for terminating, discharging or relieving any Borrower, in whole
or in
part, from any of its Obligations under this Section 3.1, it being the intention
of each Borrower that, so long as any of the Obligations hereunder remain
unsatisfied, the Obligations of such Borrower under this Section 3.1 shall
not
be discharged except by performance and then only to the extent of such
performance. The Obligations of each Borrower under this Section 3.1 shall
not
be diminished or rendered unenforceable by any winding up, reorganization,
arrangement, liquidation, reconstruction or similar proceeding with respect
to
any Borrower or the Agent or any Bank or other Loan Party. The joint and
several
liability of the Borrowers hereunder shall continue in full force and effect
notwithstanding any absorption, merger, amalgamation or any other change
whatsoever in the name, constitution or place of formation of any of the
Borrowers or the Agent or any Bank.
(g) Each
Borrower represents and warrants to the Agent and Banks that such Borrower
is
currently informed of the financial condition of the Borrowers and of all
other
circumstances which a diligent inquiry would reveal and which bear upon the
risk
of nonpayment of the Obligations.
(h) The
provisions of this Section 3.1 are made for the benefit of the Agent, the
Banks
and their respective successors and assigns, and may be enforced by any of
them
from time to time against any or all of the Borrowers as often as occasion
therefor may arise and without requirement on the part of such Agent, Bank,
successor or assign first to marshal any of its or their claims or to exercise
any of its rights against any of the other Borrowers or to exhaust any remedies
available to it against any of the other Borrowers or to resort to any other
source or means of obtaining payment of any of the Obligations hereunder
or to
elect any other remedy. The provisions of this Section 3.1 shall remain in
effect until all of the Obligations shall have been paid in full or otherwise
fully satisfied. If at any time, any payment, or any part thereof, made in
respect of any of the Obligations, is rescinded or must otherwise be restored
or
returned by the Agent or any Bank upon the insolvency, bankruptcy or
reorganization of any of the Borrowers, or otherwise, the provisions of this
Section 3.1 will forthwith be reinstated in effect, as though such payment
had
not been made.
(i) Each
Borrower hereby agrees that it will not enforce any of its rights of
contribution or subrogation against the other Borrower with respect to any
liability incurred by it hereunder or under any of the other Loan Documents,
any
payments made by it to the Agent or the Banks with respect to any of the
Obligations or any collateral security therefor until such time as all of
the
Obligations have been paid in full in cash. Any claim which any Borrower
may
have against the other Borrower with respect to any payments to the Agent
or any
Bank hereunder or under any other Loan Documents are hereby expressly made
subordinate and junior in right of payment, without limitation as to any
increases in the Obligations arising hereunder or thereunder, to the prior
payment in full in cash of the Obligations and, in the event of any insolvency,
bankruptcy, receivership, liquidation, reorganization or other similar
proceeding under the laws of any jurisdiction relating to any Borrower, its
debts or its assets, whether voluntary or involuntary, all such Obligations
shall be paid in full in cash before any payment or distribution of any
character, whether in cash, securities or other property, shall be made to
the
other Borrower therefor.
(j) Each
Borrower hereby agrees that, after the occurrence and during the continuance
of
any Default or Event of Default, the payment of any amounts due with respect
to
the indebtedness owing by any Borrower to the other Borrower is hereby
subordinated to the prior payment in full in cash of the Obligations. Each
Borrower hereby agrees that after the occurrence and during the continuance
of
any Default or Event of Default, such Borrower will not demand, xxx for or
otherwise attempt to collect any indebtedness of the other Borrower owing
to
such Borrower. If, notwithstanding the foregoing sentence, such Borrower
shall
collect, enforce or receive any amounts in respect of such indebtedness,
such
amounts shall be collected, enforced and received by such Borrower as trustee
for the Agent, and such Borrower shall deliver any such amounts to Agent
for
application to the Obligations in accordance with Section 4.3.
4. PAYMENTS
AND PREPAYMENTS
4.1 Optional
and Mandatory Prepayment
(a) Optional
Prepayments.
The
Borrowers shall have the right at any time and from time to time to prepay
any
of the Loans, in whole or in part, as follows:
(i) with
respect to the Eurodollar Rate Loans, by giving not less than three (3) Business
Days’ prior written notice to such effect to the Agent; and
(ii) with
respect to the Alternate Base Rate Loans, by giving not less than one (1)
Business Day’s prior written notice to such effect to the Agent.
Each
such
optional prepayment shall be accompanied by accrued interest on the amount
so
repaid to the date of such prepayment. Any partial prepayment shall be in
the
amount of $5,000,000.00 or an integral multiple thereof.
(b) Mandatory
Prepayments.
(i) Asset
Sales.
Not
later than one Business Day following the receipt of any net cash proceeds
of
any Asset Sale by the Parent or any of its Subsidiaries, the Borrowers shall
make prepayments in accordance with Section 4.1(c) in an aggregate amount
equal
to 100% of such net cash proceeds.
(ii) Debt
Issuance.
Not
later than one Business Day following the receipt of any net cash proceeds
of
any Debt Issuance by the Parent or any of its Subsidiaries, the Borrowers
shall
make prepayments in accordance with Section 4.1(c) in an aggregate amount
equal
to 100% of such net cash proceeds; provided,
however,
that no
such prepayment shall be required under this Section 4.1(b)(ii) with
respect to any Debt or other indebtedness of the Parent or any of its
Subsidiaries incurred or issued so long as (x) the net cash proceeds therefrom
are applied at the time of such incurrence or issuance to refinance or repay
any
Debt or indebtedness of the Parent or such Subsidiary that is in existence
on
the Closing Date and has a stated maturity date that is prior to March 15,
2007
or (y) in the case of any Debt or other indebtedness of the Parent incurred
under the Existing Revolving Credit Facility, the net cash proceeds therefrom
are used by the Parent solely for working capital purposes.
(iii) Equity
Issuance.
Not
later than one Business Day following the receipt of any net cash proceeds
of
any Equity Issuance by the Parent or any of its Subsidiaries, the Borrowers
shall make prepayments in accordance with Section 4.1(c) in an aggregate
amount
equal to 100% of such net cash proceeds.
(iv) SUG
EAT Entities Loan Documents.
Not
later than one Business Day following the receipt by ESSI of any net cash
proceeds constituting prepayment or repayment by any of the SUG EAT Entities
of
their respective obligations under the SUG EAT Entities Loan Documents, the
Borrowers shall make repayments in accordance with Section 4.1(c) in an
aggregate amount equal to 100% of such net cash proceeds.
(c) Application
of Mandatory Prepayments.
In the
event of any mandatory prepayment of the Loan pursuant to Section 4.1(b),
all
net cash proceeds received as provided in Section 4.1(b) shall be applied
to the
ratable prepayment of the outstanding aggregate principal amount of the Loans,
together with accrued interest thereon to the date of such
prepayment.
4.2 Repayment
of the Loans; and Maturity of the Loans.
(a) Each
Borrower jointly and severally hereby unconditionally promises to pay to
the
Agent for the account of each Bank holding a Loan or Loans the then unpaid
principal amount of each Loan on the Maturity Date.
(b) Each
Loan
shall mature, and the principal amount thereof shall be due and payable,
together with accrued and unpaid interest thereon, on the Maturity
Date.
4.3 Place
of Payment or Prepayment
All
payments and prepayments made in accordance with the provisions of this
Agreement or of the Notes or of any other Loan Document in respect of fees
or of
principal or interest on the Loans shall be made to the Agent for the account
of
the Banks at the Agent’s Payment Office, no later than 12:00 noon, New York City
time, in immediately available funds. Unless the Agent shall have received
notice from the Borrowers prior to the date on which any payment is due to
the
Banks hereunder that the Borrowers will not make any payment due hereunder
in
full, the Agent may assume that the Borrowers have made such payment in full
to
the Agent on such date and the Agent may, in reliance upon such assumption,
cause to be distributed to each Bank on such due date an amount equal to
the
amount then due to such Bank. If and to the extent the Borrowers shall not
have
so made such payment in full to the Agent, each Bank shall repay to the Agent
forthwith on demand such amount distributed to such Bank together with interest
thereon, for each day from the date such amount is distributed to such Bank
until the date such Bank repays such amount to the Agent, at the Federal
Funds
Rate. If and to the extent that the Agent receives any payment or prepayment
from the Borrowers and fails to distribute such payment or prepayment to
the
Banks ratably on the basis of their respective Pro Rata Percentage on the
day
the Agent receives such payment or prepayment, and such distribution shall
not
be so made by the Agent in full on the required day, the Agent shall pay
to each
Bank such Bank’s Pro Rata Percentage thereof together with interest thereon at
the Federal Funds Rate for each day from the date such amount is paid to
the
Agent by the Borrowers until the date the Agent pays such amount to such
Bank.
4.4 No
Prepayment Premium or Penalty
Each
prepayment pursuant to Section 4.1 shall be without premium or penalty, subject
in the case of Eurodollar Rate Loans to the provisions of Section
2.3(d).
4.5 Taxes
All
payments (whether of principal, interest, reimbursements or otherwise) under
this Agreement or any other Loan Document shall be made by the Borrowers
without
set off or counterclaim and shall be made free and clear of and without
deduction for any present or future tax, levy, impost or any other charge,
if
any, of any nature whatsoever now or hereafter imposed by any taxing authority.
If the making of such payments is prohibited by law, unless such a tax, levy,
impost or other charge is deducted or withheld therefrom, the Borrowers jointly
and severally shall pay to the Banks, on the date of each such payment, such
additional amounts as may be necessary in order that the net amounts received
by
the Banks after such deduction or withholding shall equal the amounts which
would have been received if such deduction or withholding were not
required.
4.6 Reduction
or Termination of Commitments
The
Commitments shall automatically terminate in their entirety at 5:00 p.m.
(New
York City time) on the Closing Date.
5. FEES
5.1 Specified
Fees
The
Parent
shall
pay the fees set forth in the Fee Letter at the times and to the applicable
parties as set forth therein.
5.2 Fees
Not Interest
The
fees
described in this Agreement represent compensation for services rendered
and to
be rendered separate and apart from the lending of money or the provision
of
credit and do not constitute compensation for the use, detention, or forbearance
of money, and the obligation of the Borrowers to pay each fee described herein
shall be in addition to, and not in lieu of, the obligation of the Borrowers
to
pay interest, other fees described in this Agreement, and expenses otherwise
described in this Agreement. Fees shall be payable when due in Dollars and
in
immediately available funds.
6. APPLICATION
OF PROCEEDS
6.1 Application
of Proceeds
The
Borrowers
agree
that the proceeds of the Loans shall be used solely to
fund
the SUG EAT Entities Loan in accordance with the terms of the SUG EAT Entities
Loan Documents, which loan proceeds shall in turn be immediately used by
the SUG
EAT Entities to fund the purchase price of the Xxx Xxxxxxxxxx
Acquisition.
7. REPRESENTATIONS
AND WARRANTIES
Each
Borrower represents and warrants that:
7.1 Organization
and Qualification
Each
of
the Parent, each of its Subsidiaries and each of the SUG Partnership Entities:
(a) is a corporation, limited liability company or partnership, as the case
may
be, duly organized, validly existing, and in good standing under the laws
of its
respective state of incorporation or formation; (b) has the corporate or
organizational power to own its respective properties and to carry on its
respective businesses as now conducted; and (c) is duly qualified as foreign
corporation, limited liability company or partnership, as the case may be
(or,
in the case of any Southern Union Trust, trusts) to do business and is in
good
standing in every jurisdiction where such qualification is necessary except
when
the failure to so qualify would not or does not have a Material Adverse Effect.
Each Borrower is a corporation organized under the laws of Delaware and has
the
Subsidiaries listed on Schedule
7.1(A),
and no
others, each of which is a Delaware corporation unless otherwise noted on
Schedule
7.1(A).
None of
the Subsidiaries listed on Schedule
7.1(A)
as
“Inactive Subsidiaries” conducts or will conduct any business, and none of such
Subsidiaries has any assets other than minimum legal capitalization. As of
the
Closing Date, (a) CDEC directly owns and holds all the Equity Interests in
SUG
EAT Inc., (b) SUG EAT Inc. directly owns and holds all of the Equity Interests
in SUG EAT LLC, (c) Southern Union Panhandle is the sole manager of SUG EAT
LLC
and (d) Schedule
7.1(B)
sets
forth all the holders and owners of all the Equity Interests in each of SRES,
REM, Leapartners and their respective subsidiaries (including without
limitation, the Partnership Companies) immediately after giving effect to
the
Xxx Xxxxxxxxxx Acquisition.
7.2 Financial
Statements
The
Parent has furnished the Banks with (a) the Parent’s annual audit reports
containing the Parent’s consolidated balance sheets, statements of income and
stockholder’s equity and a cash flow statements as at and for the twelve month
periods ending June 30, 2002, June 30, 2003, June 30, 2004 and December 31,
2004, accompanied by the certificate of Price Waterhouse Coopers and (b)
the
Parent’s unaudited financial report as of the fiscal quarter ending September
30, 2005. These statements are complete and correct and present fairly in
accordance with GAAP, consistently applied throughout the periods involved,
the
consolidated financial position of the Parent and the Subsidiaries and the
results of its and their operations as at the dates and for the periods
indicated subject, as to interim statements only, to changes resulting from
customary end-of-year credit adjustments which in the aggregate will not
be
material.
7.3 Litigation
Except
as
disclosed on Schedule
7.3
or
Schedule
7.16,
there
is no: (a) action or proceeding pending or, to the knowledge of the Borrowers,
threatened against the Parent or any of its Subsidiaries before any court,
administrative agency or arbitrator which is reasonably expected to have
a
Material Adverse Effect; (b) judgment outstanding against the Parent or any
of
its Subsidiaries for the payment of money; or (c) other outstanding judgment,
order or decree affecting the Parent or any of its Subsidiaries before or
by any
administrative or governmental authority, compliance with or satisfaction
of
which may reasonably be expected to have a Material Adverse Effect.
7.4 Default
Neither
the Parent nor any of its Subsidiaries is in default under or in violation
of
the provisions of any instrument evidencing any Debt or of any agreement
relating thereto or any judgment, order, law, writ, injunction or decree
of any
court or any order, regulation or demand of any administrative or governmental
instrumentality which default or violation might have a Material Adverse
Effect.
7.5 Title
to Assets
The
Parent and each of its Subsidiaries have good and marketable title to their
respective assets, subject to no Liens except those permitted in Section
10.2.
7.6 Payment
of Taxes
The
Parent and each of its Subsidiaries have filed all tax returns required to
be
filed and have paid all taxes shown on said returns and all assessments which
are due and payable (except such as are being contested in good faith by
appropriate proceedings for which adequate reserves for their payment have
been
provided in a manner consistent with the accounting practices followed by
the
Parent as of June 30, 2005). The Borrowers are not aware of any pending
investigation by any taxing authority or of any claims by any governmental
authority for any unpaid taxes, except as disclosed on Schedule
7.6.
7.7 Conflicting
or Adverse Agreements or Restrictions;
Governmental
Approvals.
Neither
the Parent nor any of its Subsidiaries is a party to any contract or agreement
or subject to any restriction which would have a Material Adverse Effect.
Neither the execution and delivery of this Agreement or any other Loan Document
nor the consummation of the transactions contemplated hereby nor fulfillment
of
and compliance with the respective terms, conditions and provisions of this
Agreement or of any of the other Loan Documents or of any instruments required
hereby or thereby will (a) require any consent or approval of, registration
or
filing with, or other action by any Governmental Authority, except as set
forth
in Schedule
7.7
or
(b) conflict
with or result in a breach of any of the terms, conditions or provisions
of, or
constitute a default under, or result in any violation of, or result in the
creation or imposition of any lien (other than as contemplated or permitted
by
this Agreement) on any of the property of the Parent or any of its Subsidiaries
pursuant to (i) the charter or bylaws or other applicable organizational
documents of the Parent or any of its Subsidiaries; (ii) any law or any
regulation of any administrative or governmental instrumentality; (iii) any
order, writ, injunction or decree of any court; or (iv) the terms, conditions
or
provisions of any agreement or instrument to which the Parent or any of its
Subsidiaries is a party or by which it is bound or to which it is
subject.
7.8 Authorization,
Validity, Etc.
Each
Borrower has the organizational power and authority to make, execute, deliver
and carry out this Agreement and the other Loan Documents to which such Person
is a party, and the transactions contemplated herein and therein, to make
the
borrowings provided for herein, to execute and deliver the Notes and to perform
its obligations hereunder and under the other Loan Documents to which it
is a
party and all such action has been duly authorized by all necessary
organizational proceedings on its part. Each Loan Party (other than the
Borrowers) has the organizational power and authority to make, execute, deliver
and carry out the Loan Documents to which such Person is a party and the
transactions contemplated therein and to perform its obligations thereunder
and
all such action has been duly authorized by all necessary organizational
proceeding on its part. This Agreement has been duly and validly executed
and
delivered by the Borrowers and constitutes the valid and legally binding
agreement of the Borrowers enforceable against the Borrowers in accordance
with
its terms, except as limited by Debtor Laws; and the Notes and the other
Loan
Documents, when duly executed and delivered by the Borrowers and each other
Loan
Party, as the case may be, pursuant to the provisions hereof and thereof,
will
constitute the valid and legally binding obligation of the Borrowers and
each
such other Loan Party, as the case may be, enforceable against such Person
in
accordance with the terms thereof and of this Agreement, except as limited
by
Debtor Laws.
7.9 Investment
Company Act Not Applicable
Neither
the Parent nor any of its Subsidiaries is an “investment company” or a company
“controlled” by an “investment company”, within the meaning of the Investment
Company Act of 1940, as amended.
7.10 Public
Utility Holding Company Act Not Applicable
Neither
the Parent nor any of its Subsidiaries is a “holding company”, or a “subsidiary
company” of a “holding company”, or an “affiliate” of a “holding company”, or an
affiliate of a “subsidiary company” of a “holding company”, as such terms are
defined in the Public Utility Holding Company Act of 2005, as
amended.
7.11 Regulations
G, T, U and X
No
Loan
shall be a “purpose credit secured directly or indirectly by margin stock”
within the meaning of Regulation U of the Board of Governors of the Federal
Reserve System (“margin stock”); none of the proceeds of any Loan will be used
to extend credit to others for the purpose of purchasing or carrying any
margin
stock, or for any other purpose which would constitute this transaction a
“purpose credit secured directly or indirectly by margin stock” within the
meaning of said Regulation U, as now in effect or as the same may hereafter
be
in effect. Neither the Parent nor any of its Subsidiaries will take or permit
any action which would involve the Banks in a violation of Regulation G,
Regulation T, Regulation U, Regulation X or any other regulation of the Board
of
Governors of the Federal Reserve System or a violation of the Securities
Exchange Act of 1934, in each case as now or hereafter in effect. Not more
than
twenty-five percent (25%) of the value (as determined by any reasonable method)
of the assets subject to the negative pledge set forth in Section 10.2 and
the
restrictions on disposition of assets set forth in Section 10.8 is represented
by margin stock.
7.12 ERISA
Except
as
disclosed in Part
A
in Schedule 7.12,
no
Reportable Event (as defined in § 4043(c) of ERISA) has occurred with respect to
any Plan. Each Plan complies in all material respects with all applicable
provisions of ERISA, and, the Parent and each of its Subsidiaries have filed
all
reports required by ERISA and the Code to be filed with respect to each Plan.
Except as disclosed in Part
B
in Schedule 7.12,
the
Borrowers have no knowledge of any event which could result in a liability
of
the Parent or any of its Subsidiaries to the Pension Benefit Guaranty
Corporation. The Parent and each of its Subsidiaries have met all requirements
with respect to funding the Plans imposed by ERISA or the Code. Since the
effective date of Title IV of ERISA, there have not been any, nor are there
now
existing any, events or conditions that would permit any Plan to be terminated
under circumstances which would cause the lien provided under § 4068 of ERISA to
attach to any property of the Parent or any of its Subsidiaries.
7.13 No
Financing of Certain Security Acquisitions
None
of
the proceeds of any Loan will be used to acquire any security in any transaction
that is subject to §00 xx §00 of the Securities Exchange Act of 1934, as
amended, except the equity interests described in subparagraph (ii) of the
definition of “Qualifying Assets”.
7.14 Franchises,
Co-Licenses, Etc
The
Parent and each of its Subsidiaries own or have obtained all the material
governmental permits, certificates of authority, leases, patents, trademarks,
service marks, trade names, copyrights, franchises and licenses, and rights
with
respect thereto, required or necessary (or, in the sole and independent judgment
of the Borrowers, prudent) in connection with the conduct of their respective
businesses as presently conducted or as proposed to be conducted.
7.15 Lines
of Business
The
nature of the Parent’s lines of business are predominately the following: (a)
the operation of energy distribution and transportation services, including
without limitation, natural gas sales, storage and transportation and
distribution, propane sales and distribution and promotion, marketing and
sale
of compressed natural gas and the terminalling and storage of liquefied natural
gas; (b) the development and marketing of fuel cell and distributive energy
options; (c) electric marketing/generation; (d) the operation of fuel oil
distribution and transportation networks; (e) gathering and processing of
natural gas; and (f) sales and rentals of appliances utilizing one or more
of
the fuel or energy options specified in this Section 7.15. Notwithstanding
anything contained in the foregoing in this Section 7.15 to the contrary,
the
only line of business of the SUG EAT Entities is the SUG EAT Entities Permitted
Activities.
7.16 Environmental
Matters
Except
as
disclosed in the environmental disclosures in the footnotes to its financial
statements as currently filed with the Securities and Exchange Commission:
(a)
all facilities and property owned or leased by the Parent or any of its
Subsidiaries have been and continue to be, owned or leased and operated by
the
Parent and such Subsidiary in material compliance with all Environmental
Laws;
(b) there has not been (during the period of the Parent’s or any of its
Subsidiaries’ ownership or lease) any Release of Hazardous Materials at, on or
under any property now (or, to the Borrower’s knowledge, previously) owned or
leased by the Parent or any of its Subsidiaries (i) in quantities that would
be
required to be reported under any Environmental Law, (ii) that required,
or may
reasonably be expected to require, the Parent or any of its Subsidiaries
to
expend funds on remediation or cleanup activities pursuant to any Environmental
Law except for remediation or clean-up activities that would not be reasonably
expected to have a Material Adverse Effect, or (iii) that otherwise, singly
or
in the aggregate, has, or may reasonably be expected to have, a Material
Adverse
Effect; (c) the Parent and each of its Subsidiaries have been issued and
are in
material compliance with all permits, certificates, approvals, orders, licenses
and other authorizations relating to environmental matters necessary for
their
respective businesses; (d) there are no polychlorinated biphenyls (PCB’s) or
asbestos-containing materials or surface impoundments in any of the facilities
now (or, to the knowledge of the Borrowers, previously) owned or leased by
the
Parent or any of its Subsidiaries, except for PCB’s, surface impoundments, and
asbestos-containing materials of the type and in quantities that do not
currently require remediation, and if remediation of such materials or
conditions is hereafter required for any reason, such remediation activities
would not reasonably be expected to have a Material Adverse Effect; (e)
Hazardous Materials have not been generated, used, treated, recycled, stored
or
disposed of in any of the facilities or on any of the property now (or, to
the
knowledge of the Borrowers, previously) owned or leased by the Parent or
any of
its Subsidiaries during the time of the Parent’s or such Subsidiary’s ownership
or leased by the Parent or any of its Subsidiaries during the time of the
Parent’s or such Subsidiary’s ownership except in material compliance with all
applicable Environmental Laws; and (f) all underground storage tanks located
on
the property now (or, to the knowledge of the Borrowers, previously) owned
or
leased by the Borrowers or any of its Subsidiaries have been (and to the
extent
currently owned or leased are) operated in material compliance with all
applicable Environmental Laws.
7.17 No
Agreements Prohibiting Pledge of Southern Union Panhandle and
Panhandle Eastern Equity Interests
The
Parent is not a party to any contract or other agreement with any Person
that
directly or indirectly prohibits the Borrower from granting any Lien against
the
Equity Interests in (i) Southern Union Panhandle or (ii) Panhandle Eastern,
in
each case at any time owned and held by the Parent as security for any Debt
of
the Parent or any of its Subsidiaries.
7.18 No
Agreements Prohibiting Pledge of Xxx
Xxxxxxxxxx Acquired Business.
Neither
the Parent
nor any
Subsidiary of the Parent
nor any
SUG EAT Entity is a party to any contract or other agreement with any Person
that directly or indirectly prohibits the Parent
or such
Subsidiary or such SUG EAT Entity from granting any Lien against the Equity
Interests in (i) SRES, (ii) REM or (iii) Leapartners, in each case at any
time
owned and held by the Parent
or any
of its Subsidiaries or any SUG EAT Entity as security for any Debt of the
Parent
or any
of its Subsidiaries.
7.19 Use
of Proceeds.
The
proceeds of the Loans will be used by the Borrowers only as permitted by
Section
6.1.
7.20 Disclosure.
(a) Any
report, financial statements, certificates or other information filed by
or on
behalf of the Parent with the SEC
(including, in each case, all amendments and supplements thereto) do not
contain
any material misstatement of fact or omit to state any material fact necessary
to make the statements therein, in the light of the circumstances under which
they were made, not materially misleading.
(b) All
reports, financial statements, certificates or other information furnished
by or
on behalf of the Parent or any of its Subsidiaries to the Agent, the Joint
Lead
Arrangers or any Bank in connection with the Xxx Xxxxxxxxxx Acquisition and
the
negotiation of this Agreement or any other Loan Document or delivered hereunder
or thereunder (as modified or supplemented by other information so furnished),
taken as a whole, are true and correct in all material respects and do not
omit
to state a material fact necessary to make the statements contained therein
not
misleading, in light of the circumstances under which such statements were
made,
in each case on the date on which such information was furnished; provided
that,
with respect to projected financial information, the Borrowers represent
only
that such information was prepared in good faith based on assumptions believed
to be reasonable at the time (it being understood that this representation
and
warranty in this Section 7.20(b) as it pertains to any of SRES, REM, Leapartners
and their respective Subsidiaries shall be limited to the knowledge of the
Borrowers).
7.21 Xxx
Xxxxxxxxxx Acquired Business Matters.
To
the
knowledge of the Borrowers, the
representations and warranties contained in the Xxx Xxxxxxxxxx Acquisition
Documents that relate to the Partnership Companies and its Subsidiaries
are true
and correct in all material respects
as of
the Closing Date, with only such exceptions as would not in the aggregate
reasonably be expected to have a material adverse effect on (x) the Borrowers
or
(y) SRES, REM, Leapartners and their Subsidiaries.
7.22 Collateral
Matters.
(a) Each
Collateral Document delivered pursuant to Section 8.6 will, upon execution
and
delivery thereof, be effective to create in favor of the Agent, for the benefit
of the Secured Parties, legal, valid and enforceable Liens on, and security
interests in, all of the Loan Parties’ right, title and interest in and to the
Collateral thereunder, and (i) when all appropriate filings or recordings
are made in the appropriate offices as may be required under applicable law
and
(ii) upon the taking of possession or control by the Agent of such
Collateral with respect to which a security interest may be perfected only
by
possession or control (which possession or control shall be given to the
Agent
to the extent required by any Collateral Document), such Collateral Document
will constitute fully perfected Liens on, and security interests in, all
right,
title and interest of the Loan Parties in such Collateral, in each case free
and
clear of any Lien, except for the liens and security interests created by
the
Loan Documents and, in the case of the SUG EAT Entities Collateral, the
Permitted Subordinated Lien.
(b) The
Parent has rights and sufficient title to and is the legal and beneficial
owner
of the Collateral pledged by it under the Collateral Documents free and clear
of
any Lien, except for the liens and security interests created by the Loan
Documents.
(c) Upon
the
consummation of the Xxx Xxxxxxxxxx Acquisition, each of the SUG EAT Entities
will have rights and sufficient title to and will be the legal and beneficial
owners of the Acquired Business Equity Interests and the other Collateral
to be
pledged by them under the Collateral Documents to which it is a party, free
and
clear of any Lien, except for the liens and security interests created under
the
Loan Documents and the Permitted Subordinated Lien.
8. CONDITIONS
The
several obligations of each Bank to make its Loan is subject to the following
conditions:
8.1 Representations
True and No Defaults.
(a) The
representations and warranties contained in Section 7 shall be true and correct
on and as of the particular Borrowing Date as though made on and as of such
date.
(b) None
of
the Loan Parties shall be in default in the due performance of any covenant
on
its part contained in this Agreement and the other Loan Documents.
(c) No
Event
of Default or Default shall have occurred and be continuing.
8.2 Governmental
Approvals
The
Borrowers and each other Loan Party shall have obtained all orders, approvals
or
consents of any Governmental Authority required in connection with the Xxx
Xxxxxxxxxx Acquisition or the making and carrying out of this Agreement and
the
other Loan Documents, the making of the borrowings pursuant hereto, the issuance
of the Notes to evidence such borrowings, and the execution and delivery
of the
other Loan Documents, and all applicable waiting periods and appeal periods
shall have expired, in each case without the imposition of any burdensome
condition. The Borrowers shall have obtained all amendments or consents of
any
other Person under any applicable loan or financing agreement or other debt
instrument of the Borrowers or its Affiliates that are necessary or reasonably
desirable to permit the consummation of (a)
the
Xxx Xxxxxxxxxx Acquisition on the terms contemplated by the Xxx Xxxxxxxxxx
Acquisition Documents and (b)
this
Agreement and the other Loan Documents and the transactions contemplated
hereunder and thereunder on the terms contemplated hereby and thereby (including
without limitation, the security arrangements contemplated hereby), each
of
which amendments or consents shall be in form and substance satisfactory
to the
Banks.
8.3 Compliance
With Law
The
business and operations of the Parent and each of its Subsidiaries as conducted
at all times relevant to the transactions contemplated by this Agreement
to and
including the close of business on the particular Borrowing Date shall have
been
and shall be in compliance in all material respects with all applicable State
and Federal laws, regulations and orders affecting the Parent and each of
its
Subsidiaries and the business and operations of any of them.
8.4 Notice
of Borrowing and Other Documents
On
each
Borrowing Date, the Banks shall have received (a) a Notice of Borrowing;
and (b)
such other documents and certificates relating to the transactions herein
contemplated as the Banks may reasonably request.
8.5 Payment
of Fees and Expenses
The
Borrowers shall have paid (a) all expenses of the type described in Section
13.3
through the date of such Loan, (b) all closing, structuring and other invoiced
fees owed as of the Closing Date to the Agent, any of the Banks and/or any
of
the Joint Lead Arrangers (and their respective Affiliates) by the Borrowers
under this Agreement or any other written agreement between the Parent and/or
the other Borrower, the Agent, the applicable Bank(s) and/or the applicable
Joint Lead Arranger(s) (and their respective Affiliates), and (c) all the
fees
set forth in the Fee Letter at the times and to the parties as set forth
in such
Fee Letter.
8.6 Loan
Documents, Opinions and Other Instruments
As
of the
Closing Date, each applicable Loan Party (to the extent a party thereto)
shall
have delivered to the Agent the following: (a) this Agreement, each of the
Notes, the Collateral Documents (including the Pledge Agreements and financing
statements or any other evidence of all recordings, filings or any other
action
that the Agent may deem necessary in order to perfect and protect the first
priority liens and security interests created under the Pledge Agreements),
the
Intercreditor Agreement and all other Loan Documents required by the Agent
and
the Banks to be executed and delivered by such Loan Party in connection with
this Agreement; (b) with respect to each Loan Party, a certificate from the
Secretary of State of the State of Delaware as to the continued existence
and
good standing of each such Loan Party in the State of Delaware; (c) with
respect
to the Parent, a certificate from the Secretary of State of the State of
Texas
as to the continued qualification of each such Loan Party to do business
in the
State of Texas; (d) a Secretary’s Certificate executed by the duly elected
Secretary or a duly elected Assistant Secretary of the Parent, in a form
acceptable to the Agent, whereby such Secretary or Assistant Secretary certifies
that attached thereto is a true and complete copy of each Organizational
Document of each Borrower and that such Organizational Documents have not
been
modified, rescinded or amended and are in full force and effect, (2) that
attached thereto is a true and complete copy of resolutions adopted by the
Board
of Directors of each Borrower authorizing such Borrower to enter into the
Loan
Documents, to borrow hereunder, to pledge its interest in the Collateral
and to
perform its obligations under the Loan Documents, in each case all in accordance
with the terms of this Agreement and the other Loan Documents, and to enter
into
such documents and perform such obligation necessary to consummate the SUG
EAT
Entity Loan, the Xxx Xxxxxxxxxx Acquisition Assignment and the Qualified
Transaction, and that such resolutions have not been modified, rescinded
or
amended and are in full force and effect; (e) an officer’s certificate executed
by the duly elected senior vice president of SUG EAT, Inc., in a form acceptable
to the Agent, whereby such senior vice president certifies (1) that attached
thereto is a true and complete copy of each Organizational Document of each
SUG
EAT Entity and that such Organizational Documents have not been modified,
rescinded or amended and are in full force and effect, (2) that attached
thereto is a true and complete copy of resolutions adopted by the Board of
Directors of SUG EAT Inc., in its individual capacity and as sole member
of SUG
EAT LLC, authorizing such SUG EAT Entity to enter into the Loan Documents
to
which it is a party, to pledge their respective interests in the Collateral
to
secure the Obligations and to perform their obligations thereunder, in each
case
all in accordance with the terms of this Agreement and the other Loan Documents,
and to enter into such documents and perform such obligation necessary to
consummate the SUG EAT Entity Loan, the Xxx Xxxxxxxxxx Acquisition Assignment
and the Qualified Transaction, and that such resolutions have not been modified,
rescinded or amended and are in full force and effect, and (3) as to the
incumbency and specimen signature of each officer of SUG EAT Inc. executing
any
Loan Document or any other document delivered in connection herewith on behalf
of such Loan Party (together with a certificate of another officer as to
the
incumbency and specimen signature of the secretary or assistant secretary
executing the certificate in this clause (3)); (f) a legal opinion from
in-house counsel for the Borrowers, dated as of the Closing Date, addressed
to
the Agent and the Banks in the form of Exhibit
E;
(g)
with respect to the Borrowers, a solvency certificate of a senior financial
officer of the Parent in form and substance satisfactory to the Agent; and
(h) a
legal opinion from in-house counsel for SUG EAT, Inc., dated as of the Closing
Date, addressed to the Agent and the Banks covering matters similar to the
opinions set forth in Exhibit E but with respect to each of the SUG EAT
Entities, which legal opinion shall be in form and substance reasonably
satisfactory to the Agent.
8.7 Consummation
of Xxx
Xxxxxxxxxx Acquisition
Simultaneously
with the funding of Loans on the Closing Date, the SUG EAT Entities Loan
to the
SUG EAT Entities shall be made by ESSI pursuant to the SUG EAT Entities Loan
Documents and the Xxx Xxxxxxxxxx Acquisition shall have been consummated
on
terms and conditions substantially as set forth in the
Xxx
Xxxxxxxxxx Acquisition Documents, as amended or modified in a manner that
does
not materially adversely impact the Banks.
8.8 No
Material Adverse Change
(a) There
has
not occurred any event, development or circumstance since December 31, 2004
that
has caused or could reasonably be expected to cause a material adverse condition
or material adverse change in or affecting (A) the business, condition
(financial or otherwise), results of operation, assets, liabilities, management,
prospects or value of the Parent and its Subsidiaries, taken as a whole or
(B)
the validity or enforceability of any of the Loan Documents or the rights
and
remedies of the Agent and the Banks thereunder.
(b) There
has
not occurred any Acquired Business Material Adverse Effect on any Partnership
Company since September 30, 2005.
8.9 Financial
Statements
The
Joint
Lead Arrangers shall have received, reviewed, and be satisfied with, the
following:
(a) in
the
case of the Parent: (i) the audited consolidated balance sheets and related
statements of income, stockholders’ equity and cash flows of each of the Parent
for each of the fiscal years ending 2002, 2003 and 2004 and (ii) unaudited
consolidated and consolidating balance sheets and related statements of income,
stockholders’ equity and cash flows of the Parent for fiscal quarters ending
March 31, 2005, June 30, 2005 and September 30, 2005; and
(b) in
the
case of the Partnership Companies: (i) the audited consolidated balance sheets
and related statements of income, stockholders’ equity and cash flows of the
Partnership Companies for each of the fiscal years ending 2003 and 2004 and
(ii) unaudited consolidated balance sheets and related statements of
income, stockholders’ equity and cash flows of the Partnership Companies for
fiscal quarter ending November 30, 2005.
8.10 Indebtedness
After
giving effect to the Transactions and the other transactions contemplated
hereby, the Borrowers shall have no outstanding indebtedness or preferred
Equity
Interests other than (i) indebtedness outstanding as of February 10, 2006,
(ii) indebtedness outstanding under the Existing Revolving Credit Facility
and (iii) indebtedness outstanding under this Agreement.
8.11 Miscellaneous
Documents
The
Borrowers shall have delivered to the Agent a Secretary’s Certificate executed
by the duly elected Secretary or a duly elected Assistant Secretary of the
Parent, in a form acceptable to the Agent, and dated as of the Closing Date,
whereby such Secretary or Assistant Secretary certifies (a) that attached
thereto is a true and complete copy of each of the SUG EAT Entities Transaction
Documents; and (b) that each of the SUG EAT Entities Transaction Documents
have
not been modified, rescinded or amended and are in full force and effect.
The
Banks, the Agent and the Joint Lead Arrangers shall have been satisfied in
all
respects with each SUG EAT Entities Transaction Document.
8.12 Officers’
Certificate
The
Agent
shall have received an executed Officer’s Certificate of the Parent dated the
Closing Date, confirming compliance with the conditions precedent set forth
in
this Section 8.
9. AFFIRMATIVE
COVENANTS
Each
Borrower covenants and agrees that, so long as the Borrowers may borrow
hereunder and until payment in full of the Loans, the Notes, all other
Obligations, and its other obligations under this Agreement and the other
Loan
Documents, Borrowers will:
9.1 Financial
Statements and Information
Deliver
to the Banks:
(a) as
soon
as available, and in any event within 120 days after the end of each fiscal
year
of the Parent, a copy of the annual audit report of the Parent and its
Subsidiaries for such fiscal year containing a balance sheet, statements
of
income and stockholders equity and a cash flow statement, all in reasonable
detail and certified by PricewaterhouseCoopers or another independent certified
public accountant of recognized standing satisfactory to the Banks. The Parent
will obtain from such accountants and deliver to the Banks at the time said
financial statements are delivered the written statement of the accountants
that
in making the examination necessary to said certification they have obtained
no
knowledge of any Event of Default or Default, or if such accountants shall
have
obtained knowledge of any such Event of Default or Default, they shall state
the
nature and period of existence thereof in such statement; provided
that
such accountants shall not be liable directly or indirectly to the Banks
for
failure to obtain knowledge of any such Event of Default or Default;
and
(b) as
soon
as available, and in any event within sixty (60) days after the end of each
quarterly accounting period in each fiscal year of the Parent (excluding
the
fourth quarter), an unaudited financial report of the Parent and its
Subsidiaries as at the end of such quarter and for the period then ended,
containing a balance sheet, statements of income and stockholders equity
and a
cash flow statement, all in reasonable detail and certified by a financial
officer of the Parent to have been prepared in accordance with GAAP, except
as
may be explained in such certificate; and
(c) copies
of
all statements and reports sent to stockholders of the Parent or filed with
the
Securities and Exchange Commission; and
(d) such
additional financial or other information as the Banks may reasonably request
including, without limitation, copies of such monthly, quarterly, and annual
reports of gas purchases and sales that any of the Borrowers is required
to
deliver to or file with governmental bodies pursuant to tariffs and/or franchise
agreements.
All
financial statements specified in clauses (a) and (b) above shall be furnished
in consolidated and consolidating form for the Parent and all its Subsidiaries
with comparative consolidated figures for the corresponding period in the
preceding year. Together with each delivery of financial statements required
by
clauses (a) and (b) above, the Borrowers will deliver to the Banks (i) such
schedules, computations and other information as may be required to demonstrate
that the Borrowers are in compliance with its covenants in Section 10.1 or
reflecting any noncompliance therewith as at the applicable date and (ii)
an
Officer’s Certificate stating that there exists no Event of Default or Default,
or, if any such Event of Default or Default exists, stating the nature thereof,
the period of existence thereof and what action the Borrowers has taken or
proposes to take with respect thereto. The Banks are authorized to deliver
a
copy of any financial statement delivered to it to any regulatory body having
jurisdiction over them, and to disclose same to any prospective assignees
or
participant Banks.
9.2 Lease
and Investment Schedules
Deliver
to the Banks:
(a) from
time
to time and, in any event, with each delivery of annual financial statements
under Section 9.1(a), a current, complete schedule (in a form reasonably
satisfactory to the Agent) of all agreements to rent or lease any property
(personal, real or mixed, but not including oil and gas leases) to which
the
Parent or any of its Subsidiaries is a party lessee and which, considered
independently or collectively with other leases with the same lessor, involve
an
obligation by the Parent or such Subsidiary to make payments of at least
$1,000,000.00 in any year, showing the total amounts payable under each such
agreement, the amounts and due dates of payments thereunder and containing
a
description of the rented or leased property, and all other information the
Majority Banks may request; and
(b) with
each
delivery of annual financial statements under Section 9.1(a) a current complete
schedule (in a form reasonably satisfactory to the Agent) listing all debt
exceeding $1,000,000.00 in principal amount outstanding and equity owned
or held
by the Parent or any of its Subsidiaries containing all information required
by,
and in a form satisfactory to, the Banks, except for such debt or equity
of such
Subsidiaries.
9.3 Books
and Records
Maintain,
and cause each of its Subsidiaries to maintain, proper books of record and
account in accordance with sound accounting practices in which true, full
and
correct entries will be made of all their respective dealings and business
affairs.
9.4 Insurance
.
Maintain, and cause each of its Subsidiaries to maintain, insurance with
financially sound, responsible and reputable companies in such types and
amounts
and against such casualties, risks and contingencies as is customarily carried
by owners of similar businesses and properties, and furnish to the Banks,
together with each delivery of annual financial statements under Section
9.1(a),
an Officer’s Certificate containing full information as to the insurance
carried.
9.5 Maintenance
of Property
Cause
its
Significant Property and the Significant Property of each of its Subsidiaries
to
be maintained, preserved, protected and kept in good repair, working order
and
condition so that the business carried on in connection therewith may be
conducted properly and efficiently, except for normal wear and
tear.
9.6 Inspection
of Property and Records
Permit
any officer, director or agent of the Agent or any Bank, on written notice
and
at such Bank’s expense, to visit and inspect during normal business hours any of
the properties, corporate books and financial records of the Parent and each
of
its Subsidiaries and discuss their respective affairs and finances with their
principal officers, all at such times as the Agent or any Bank may reasonably
request.
9.7 Existence,
Laws, Obligations
Maintain,
and cause each of its Subsidiaries to maintain, its corporate existence and
franchises, and any license agreements and tariffs that permit the recovery
of a
return that the Borrowers consider to be fair (and as to licenses, franchises,
and tariffs that are subject to regulatory determinations of recovery of
returns, the Borrowers have presented or is presenting favorable defense
thereof); and to comply, and cause each of its Subsidiaries to comply, with
all
statutes and governmental regulations noncompliance with which might have
a
Material Adverse Effect, and pay, and cause each of its Subsidiaries to pay,
all
taxes, assessments, governmental charges, claims for labor, supplies, rent
and
other obligations which if unpaid might become a lien against the property
of
the Parent or any of its Subsidiaries except liabilities being contested
in good
faith. Notwithstanding the foregoing, the Borrowers may dissolve those certain
inactive and minimally capitalized Subsidiaries designated as such on
Schedule
7.1.
9.8 Notice
of Certain Matters
Notify
the Agent immediately upon acquiring knowledge of the occurrence of any of
the
following events: (a) the institution or threatened institution of any lawsuit
or administrative proceeding affecting the Parent or any of its Subsidiaries
that is not covered by insurance (less applicable deductible amounts) and
which,
if determined adversely to the Parent or such Subsidiary, could reasonably
be
expected to have a Material Adverse Effect; (b) the occurrence of any material
adverse change, or of any event that in the good faith opinion of the Borrowers
is likely, to result in a material adverse change, in the assets, liabilities,
financial condition, business or affairs of the Parent or any of its
Subsidiaries; (c) the occurrence of any Event of Default or any Default;
(d) a
change by Xxxxx’x or by S&P in the rating or outlook of the Parent’s Funded
Debt or of the Parent’s unsecured, non-credit enhanced Senior Funded Debt; or
(e) the incurrence of any Lien (other than Liens granted pursuant to the
Collateral Documents and, in the case of the SUG EAT Entities Collateral,
the
Permitted Subordinated Lien) on, or claim asserted against, any of the
Collateral.
9.9 ERISA
At
all
times:
(a) except
as
disclosed in Schedule
7.12,
to the
extent required of the Parent under applicable law, maintain
and keep in full force and effect each Plan, subject to the Borrowers’
respective right, in accordance with applicable legal requirements, (i) to
amend
any such Plans, (ii) to merge any such Plans, and to (iii) cease benefit
accruals under any such Plans;
(b) to
the
extent required of Borrowers under applicable law, make contributions to
each
Plan in a timely manner and in an amount sufficient to comply with the minimum
funding standards requirements of ERISA;
(c) except
for events disclosed in Schedule
7.12,
immediately upon acquiring knowledge of any “reportable event” or of any
“prohibited transaction” (as such terms are defined in § 4043 and §406 of
ERISA) in connection with any Plan, furnish the Banks with a statement executed
by the president or chief financial officer of the Parent setting forth the
details thereof and the action which the Borrowers propose to take with respect
thereto and, when known, any action taken by the Internal Revenue Service
with
respect thereto;
(d) notify
the Banks promptly upon receipt by the Parent or any of its Subsidiaries
of any
notice of the institution of any proceeding or other action which may result
in
the termination of any Plan and furnish to the Banks copies of such
notice;
(e) to
the
extent required of any of the Borrowers under applicable law, maintain Pension
Benefit Guaranty Corporation liability coverage insurance required under
ERISA;
(f) furnish
the Banks with copies of the summary annual report for each Plan filed with
the
Internal Revenue Service as the Agent or the Banks may request; and
(g) furnish
the Banks with copies of any request for waiver of the funding standards
or
extension of the amortization periods required by § 303 and § 304 of
ERISA or § 412 of the Code promptly after the request is submitted to the
Secretary of the Treasury, the Department of Labor or the Internal Revenue
Service, as the case may be.
9.10 Compliance
with Environmental Laws
At
all
times:
(a) use
and
operate, and cause each of its Subsidiaries to use and operate, all of their
respective facilities and properties in material compliance with all
Environmental Laws; keep, and cause each of its Subsidiaries to keep, all
necessary permits, approvals, orders, certificates, licenses and other
authorizations relating to environmental matters in effect and remain in
material compliance therewith; handle, and cause each of its Subsidiaries
to
handle, all Hazardous Materials in material compliance with all applicable
Environmental Laws; and dispose, and cause each of its Subsidiaries to dispose,
of all Hazardous Materials generated by the Parent or any of its Subsidiaries
or
at any property owned or leased by them at facilities or with carriers that
maintain valid permits, approvals, certificates, licenses or other
authorizations for such disposal under applicable Environmental
Laws;
(b) promptly
notify the Agent and provide copies upon receipt of all written claims,
complaints, notices or inquiries relating to the condition of the facilities
and
properties of the Parent and each of its Subsidiaries under, or their respective
compliance with, applicable Environmental Laws wherein the condition or the
noncompliance that is the subject of such claim, complaint, notice, or inquiry
involves, or could reasonably be expected to involve, liability of or
expenditures by the Parent and its Subsidiaries of $10,000,000.00 or more;
and
(c) provide
such information and certifications which the Banks may reasonably request
from
time to time to evidence compliance with this Section 9.10.
9.11 PGA
Clauses
The
Borrowers will use their best efforts to maintain in force provisions in
all of
its tariffs and franchise agreements that permit the Parent to recover from
customers substantially all of the amount by which the cost of gas purchases
exceeds the amount currently billed to customers for the delivery of such
gas
(sometimes referred to as PGA clauses).
9.12 Conveyance
of Acquired Business Equity Interests to Subsidiaries of the
Parent.
(a) Within
one Business Day following the consummation of the final LDC Sale in respect
of
a Qualified Transaction, the Parent shall cause SRES, REM and Leapartners
to
become wholly-owned Subsidiaries of the Parent by directing
CDEC to require (i) SUG EAT Inc. to assign and convey to a wholly-owned
Subsidiary of the Parent 100% of all issued and outstanding limited partner
interests in each of SRES and REM and all other related Collateral (as such
term
is defined in the SUG EAT Entities Pledge Agreement), and (ii) SUG EAT LLC
to
assign and convey to another wholly-owned Subsidiary of the Parent 100% of
all
issued and outstanding general partner interests in SRES, REM and Leapartners
and all other related Collateral (as such term is defined in the SUG EAT
Entities Pledge Agreement).
(b) Notwithstanding
the foregoing in Section 9.12(a), in the event that the Qualified Transaction
has not been fully consummated by the Safe
Harbor Transfer Date,
then
the
Parent shall immediately cause SRES, REM and Leapartners to become wholly-owned
Subsidiaries of the Parent by directing
CDEC to require (i) SUG EAT Inc. to assign and convey to a wholly-owned
Subsidiary of the Parent 100% of all issued and outstanding limited partner
interests in each of SRES and REM and all other related Collateral (as such
term
is defined in the SUG EAT Entities Pledge Agreement), and (ii) SUG EAT LLC
to
assign and convey to another wholly-owned Subsidiary of the Parent 100% of
all
issued and outstanding general partner interests in SRES, REM and Leapartners
and all other related Collateral (as such term is defined in the SUG EAT
Entities Pledge Agreement).
9.13 Collateral
Matters Upon
Acquired Business Equity Interests Transfer
When
any
of the SUG EAT Entities shall transfer any of the Acquired Business Equity
Interests and/or other Collateral to one or more wholly-owned Subsidiaries
of
the Parent (each a “Transferee
Subsidiary”),
then
the Parent shall (1) cause the Permitted Subordinated Lien to be terminated
in
full immediately prior to the consummation of such transfer and (2) cause
the
Transferee Subsidiary to do the following: (i) at the time of the consummation
of such transfer, execute and deliver to the Agent (A) a pledge agreement
substantially similar to the SUG EAT Entities Pledge Agreement pursuant to
which
each such Transferee Subsidiary shall pledge and grant a first priority lien
on
and security interests in all such Transferee Subsidiary’s rights, title and
interests in such Acquired Business Equity Interests and such other collateral
similar to the Collateral described in the SUG EAT Entities Pledge Agreement,
subject to no other Liens, (B) other collateral documents similar to the
Collateral Documents (other than the Pledge Agreements) as the Agent may
reasonably request, (C) such documents, certificates and opinions similar
to
those that otherwise would have been required pursuant to Section 8.6 if
such
Transferee Subsidiary had been a “Loan Party” on the Closing Date and (D) UCC
financing statements in appropriate form for filing under the UCC in each
jurisdiction as may be necessary or appropriate or, in the opinion of the
Agent,
desirable to perfect the Liens created, or purported to be created, by the
Collateral Documents; (ii) prior to the consummation of such transfer, deliver
to the Agent copies of UCC, tax and judgment lien searches, bankruptcy and
pending lawsuit searches or equivalent reports or searches, each of a recent
date in relation to the date of such transfer listing all effective financing
statements, lien notices or comparable documents that name any such Transferee
Subsidiary as debtor and that are filed in those state and county jurisdictions
in which any property of such Transferee Subsidiary is located and the state
and
county jurisdictions in which such Transferee Subsidiary is organized or
maintains its principal place of business, none of which encumber the Collateral
covered or intended to be covered by the Collateral Documents (other than
the
Liens thereon created pursuant to the Collateral Documents); and (iii) take
such
other action as the Agent deems desirable or advisable to create, perfect
and
preserve the security interest to be so pledged and granted; all the foregoing
documents and actions described in clauses (1) and (2) above to be in form
and
substance reasonably satisfactory to the Agent.
9.14 Control
of SUG EAT LLC
Southern
Union Panhandle shall at all times until the consummation of the Acquired
Business Equity Interests Transfer, directly
or indirectly, have the power to direct or cause the direction of the
management, policies and/or activities of SUG EAT LLC, through the SUG
Management Agreement and through the operating agreement of SUG EAT LLC (it
being understood and agreed that Southern Union shall at all times be the
sole
non-member manager of SUG EAT LLC pursuant to such operating
agreement).
10. NEGATIVE
COVENANTS
The
Borrowers covenant and agree that, so long as the Borrowers may borrow hereunder
and until payment in full of the Loans, the Notes, all other Obligations,
and
its other obligations under this Agreement and the other Loan Documents,
except
with the written consent of the Banks:
10.1 Capital
Requirements
The
Borrowers will not:
(a) permit
the Parent’s Consolidated Net Worth at the end of any fiscal quarter to be less
than the sum of (i) $1,267,663,000; (ii) 40% of Consolidated Net Income (if
positive) for the period commencing on January 1, 2004 and ending on the
date of
determination, and treated as a single accounting period; (iii) the difference
between (A) 100% of the net proceeds of any issuance of capital or preferred
stock or any other Equity-Preferred Securities by the Parent or any consolidated
Subsidiary received by the Parent or such consolidated Subsidiary at any
time
after January 1, 2004; and (B) the aggregate amount of all redemption or
repurchase payments hereafter made, if any, by the Parent and any such
consolidated Subsidiary in connection with the repurchase by the Parent or
any
such consolidated Subsidiary of any of their respective capital or preferred
stock; (iv) without duplication, the difference between (A) 100% of the net
proceeds heretofore and hereafter received by the Parent and any consolidated
Subsidiary in respect of the issuance by the Parent or such consolidated
Subsidiary of the Structured Securities, and (B) the aggregate amount of
all
redemption payments hereafter made, if any, by the Parent and any such
consolidated Subsidiary in connection with the redemption of any of the
Structured Securities; and (v) the minority interests in the Parent’s
Subsidiaries; or
(b) permit
the ratio of the Parent’s Consolidated Total Indebtedness to its Consolidated
Total Capitalization to be greater than 0.70 to 1.00 at the end of any fiscal
quarter ending on or after the Closing Date; or
(c) acquire,
or permit any of their respective Subsidiaries to acquire, any assets other
than
(i) investments permitted under Section 10.4, or (ii) Qualifying Assets;
or
(d) permit
the ratio of EBDIT to Cash Interest Expense for the four fiscal quarters
most
recently ended (considered as a single accounting period) at any time to
be less
than 2.00 to 1.00 at all times.
10.2 Mortgages,
Liens, Etc
The
Borrowers will not, and will not permit any of their respective Subsidiaries
to,
create or permit to exist any Lien (including the charge upon assets purchased
under a conditional sales agreement, purchase money mortgage, security agreement
or other title retention agreement) upon any of its respective assets, whether
now owned or hereafter acquired, or assign or otherwise convey any right
to
receive income, except:
(a) Liens
for
taxes not yet due or that are being contested in good faith by appropriate
proceedings;
(b) other
Liens incidental to the conduct of its business or the ownership of its assets
that were not incurred in connection with the borrowing of money or the
obtaining of advances or credit, and that do not in the aggregate materially
detract from the value of such assets or materially impair the use thereof
in
the operation of such business;
(c) Liens
on
assets of any of their respective Subsidiaries to secure obligations of such
Subsidiary to the Parent or another of its Subsidiaries;
(d) (i)
Liens
on property existing at the time of acquisition thereof by the Parent or
any of
its Subsidiaries, including without limitation, (A) any property acquired
by the
Parent in consummating and finalizing any of the Prior Acquisitions, (B)
any
Liens existing on any property of Panhandle Eastern or any of its Subsidiaries
to secure existing Debt of Panhandle Eastern or any of its Subsidiaries as
of
the Existing Revolving Credit Facility Closing Date and (C) any Liens against
any property of Panhandle Eastern or any of its Subsidiaries to secure Panhandle
Eastern Refinancing Debt (provided
such
Liens are limited to property of Panhandle Eastern or any of its Subsidiaries
securing the Debt so extended, refinanced, renewed, replaced, defeased or
refunded), or (ii) purchase money Liens placed on an item of real or personal
property purchased by the Parent or any of its Subsidiaries to secure a portion
of the purchase price of such property; provided
that no
such Lien may encumber or cover any other property of the Parent or any of
its
Subsidiaries; and
(e) Liens
granted pursuant to the Collateral Documents to secure the Secured
Obligations.
10.3 Debt
The
Borrowers will not, and will not permit any of their respective Subsidiaries
to,
incur or permit to exist any Debt, except:
(a) Debt
outstanding under this Agreement, Debt outstanding under the Existing Revolving
Credit Facility (including reimbursement obligations under the Existing
Revolving Credit Facility Letters of Credit), and Debt issued pursuant to
any
Equity-Preferred Securities (to the extent the same constitutes Debt) in
each
case not in default, as well as (i) Debt of Panhandle Eastern and/or any
of its
Subsidiaries outstanding as of the Existing Revolving Credit Facility Closing
Date, (ii) any Panhandle Eastern Refinancing Debt, (iii) any working capital
credit facility or facilities provided directly to Panhandle Eastern and/or
any
of Panhandle Eastern’s Subsidiaries by any party other than the Parent, so long
as the principal amount of all such outstanding working capital facilities,
together with the outstanding principal amount of any working capital loans
or
advances by the Parent to Panhandle Eastern and/or any of Panhandle Eastern’s
Subsidiaries, does not exceed (A) $50,000,000 in the aggregate at any time
that
the ratio of Consolidated Total Indebtedness to Consolidated Total
Capitalization for Panhandle Eastern and Panhandle Eastern’s Subsidiaries
(excluding the Parent and all other Subsidiaries of the Parent for purposes
of
such calculation) is greater than 0.65 to 1.00 and (B) $75,000,000 in the
aggregate at any time that the ratio of Consolidated Total Indebtedness to
Consolidated Total Capitalization for Panhandle Eastern and Panhandle Eastern’s
Subsidiaries (excluding the Parent and all other Subsidiaries of the Parent
for
purposes of such calculation) is less than or equal to 0.65 to 1.00, and
(iv)
any loans or advances by the Parent to Panhandle Eastern and/or any of the
Parent’s other Subsidiaries permitted under Section 10.4(b);
(b) Debt
of
any Subsidiary of the Parent to the Parent or any other Subsidiary of the
Parent, except to the extent limited by the terms of Section 10.4(b), and
Debt
of the Parent to any Subsidiary of the Parent;
(c) Debt
existing as of September 30, 2005 as reflected on financial statements delivered
under Section 7.2(b) and refinancings thereof and, in the case of the 2008
Senior Notes, any remarketings thereof in accordance with the terms of the
2003
Supplemental Indenture, other than Debt that has been refinanced by the proceeds
of loans under the Existing Revolving Credit Facility;
(d) endorsements
in the ordinary course of business of negotiable instruments in the course
of
collection;
(e) Debt
of
the Parent or any of its Subsidiaries representing the portion of the purchase
price of property acquired by the Parent or such Subsidiary that is secured
by
Liens permitted by the provisions of Section 10.2(d); provided,
however,
that at
no time may the aggregate principal amount of such Debt outstanding exceed
thirty percent (30%) of the Consolidated Net Worth of the Parent and its
Subsidiaries as of the applicable determination date;
(f) Debt
evidenced by the Senior Notes;
(g) additional
Debt of the Parent and Structured Securities of the Parent and the Southern
Union Trusts, provided
that
after giving effect to the issuance thereof, there shall exist no Default
or
Event of Default; and: (i) the ratio of Consolidated Total Indebtedness to
Consolidated Total Capitalization shall be no greater than 0.70 to 1.00 at
all
times on or after the Closing Date; (ii) the ratio of EBDIT for the four
fiscal
quarters most recently ended to pro forma Cash Interest Expense for the
following four fiscal quarters shall be no less than 2.00 to 1.0 at all times;
provided, however,
that if
the additional Debt for which the determinations required to be made by this
subparagraph (g) will be used to finance in whole or in part the consideration
to be paid by the Parent for the acquisition of any entity otherwise permitted
under the terms of this Agreement, the determination of EBDIT for purposes
of
this ratio shall include not only the EBDIT of the Parent and its Subsidiaries
for the four fiscal quarters most recently ended, but shall also include
the
EBDIT of such entity to be acquired for such four fiscal quarters most recently
ended; and (iii) (A) such Debt and Structured Securities shall have a final
maturity or mandatory redemption date, as the case may be, no earlier than
the
Maturity Date and shall mature or be subject to mandatory redemption or
mandatory defeasance no earlier than the Maturity Date (as so extended) and
shall be subject to no mandatory redemption or “put” to the Parent or any
Southern Union Trust exercisable, or sinking fund or other similar mandatory
principal payment provisions that require payments to be made toward principal,
prior to the Maturity Date (as so extended); or (B) (x) such additional Debt
shall have a final maturity date prior to the Maturity Date, (y) such additional
Debt shall not exceed Two Hundred Fifty Million Dollars ($250,000,000.00)
in the
aggregate plus Twenty Million Dollars ($20,000,000.00) of reimbursement
obligations incurred in connection with Non-Revolving Credit Facility Letters
of
Credit issued by a Bank or Banks or by any other financial institution, and
(z)
such additional Debt shall be borrowed from a Bank or Banks as a loan or
loans
arising independent of this Agreement or shall be borrowed from a financial
institution that is not a Bank under this Agreement; and
(h) additional
Debt of Trunkline LNG Holdings or any of its Subsidiaries, so long as (i)
such
Debt is to Trunkline LNG Holdings and/or any of its Subsidiaries only and
is not
recourse in any respect to the Parent or any other Subsidiary of the Parent
(other than Panhandle Eastern and its Subsidiaries), (ii) the proceeds of
such
Debt is used solely to finance capital expenditures of Trunkline LNG Holdings
and/or its Subsidiaries, and (iii) after giving effect to such Debt, no Default
or Event of Default shall exist.
10.4 Loans,
Advances and Investments
The
Borrowers will not, and will not permit any of their respective Subsidiaries
to,
make or have outstanding any loan or advance to, or own or acquire any stock
or
securities of or equity interest or other Investment in, any Person, except
(without duplication):
(a) except
to
the extent prohibited by Section 10.19, stock or other equity interests of
(i)
the Subsidiaries named in Section 7.1; (ii) in addition to Sections 10.4(g)
and
10.4(l), other entities that are acquired by the Parent or any of its
Subsidiaries but that are promptly merged with and into the Parent; (iii)
Southern Union Panhandle, Panhandle Eastern and any Subsidiaries of Panhandle
Eastern acquired as a result of the Panhandle Eastern Acquisition; and (iv)
the
same Qualifying Entities as the Qualifying Entities under subparagraph (ii)
of
the definition of “Qualifying Assets”, provided
that at
any one time the aggregate purchase price paid for such stock and other equity
interests in such Qualifying Entities, including the aggregate amount of
Debt
assumed or deemed incurred by the Parent in connection with the purchase
of such
stock and other equity interests, is not more than twenty percent (20%) of
the
Consolidated Net Worth of the Parent and its Subsidiaries as of the applicable
determination date; provided,
however,
that,
notwithstanding the foregoing in this Section 10.4(a) to the contrary, none
of
the SUG Partnership Entities may acquire any Equity Interests in any other
Subsidiary of the Parent at any time prior to the consummation of the Acquired
Business Equity Interests Transfer;
(b) subject
to Section 10.4(j) below, loans or advances to any of the Parent’s Subsidiaries,
other than to any of the SUG Partnership Entities at any time prior to the
consummation of the Acquired Business Equity Interests Transfer; provided,
however,
that
the principal amount of such loans and advances for working capital purposes
at
any time outstanding to Panhandle Eastern and/or any of Panhandle Eastern’s
Subsidiaries, together with the principal amount of any outstanding working
capital credit facility or facilities provided directly to Panhandle Eastern
and/or any of Panhandle Eastern’s Subsidiaries by any party other than the
Parent, does not exceed $25,000,000 in the aggregate at any time;
(c) Securities
maturing no more than 180 days after Parent’s purchase that are
either:
(i) readily
marketable securities issued by the United States or its agencies or
instrumentalities; or
(ii) commercial
paper rated “Prime 2” by Xxxxx’x or A-2 by S&P; or
(iii) certificates
of deposit or repurchase contracts on customary terms with financial
institutions in which deposits are insured by any agency or instrumentality
of
the United States; or
(iv) readily
marketable securities received in settlement of liabilities created in the
ordinary course of business; or
(v) obligations
of states, agencies, counties, cities and other political subdivisions of
any
state rated at least MIG2, VMIG2 or Aa by Xxxxx’x or AA by S&P;
or
(vi) loan
participations in credits in which the borrower’s debt is rated at least Aa or
Prime 2 by Xxxxx’x or AA or A-2 by S&P; or
(vii) money
market mutual funds that are regulated by the Securities and Exchange
Commission, have a dollar-weighted average stated maturity of 90 days or
fewer
on their investments and include in their investment objectives the maintenance
of a stable net asset value of $1 for each share.
(d) other
equity interests owned by any of its Subsidiaries on the date of this Agreement
and such additional equity interests to the extent (but only to the extent)
that
such Subsidiary is legally obligated to acquire those interests on the date
of
this Agreement, in each case as disclosed to the Banks in writing;
(e) loans
or
advances by the Parent to customers in connection with and pursuant to marketing
and merchandising products that the Parent reasonably expects to increase
sales
of the Parent or its Subsidiaries, provided
that:
(i) such loans must be either less than $2,000,000.00 to any one customer
(or
group of affiliated customers, shown on the Parent’s records to be Affiliates)
or must be disclosed on Schedule
9.2
hereof;
and (ii) all such loans must not exceed $24,000,000.00 in the aggregate
outstanding at any time;
(f) travel
and expense advances in the ordinary course of business to officers and
employees;
(g) the
applicable Subsidiaries of the Parent may acquire the Acquired Business Equity
Interests pursuant to the Acquired Business Equity Interests
Transfer;
(h) except
to
the extent prohibited by Section 10.19, stock or securities of or equity
interests in, any Person, provided
that,
after giving effect to the acquisition and ownership thereof, the Borrowers
are
in compliance with the provisions of Sections 10.1(a), 10.1(b) and 10.1(d);
provided,
however,
that,
notwithstanding the foregoing in this Section 10.4(h) to the contrary, none
of
the SUG Partnership Entities may acquire any Equity Interests in any other
Subsidiary of the Parent at any time prior to the consummation of the Acquired
Business Equity Interests Transfer;
(i) loans
or
advances to any member of the CCE Group by the Parent or any of its Subsidiaries
not otherwise permitted under the other provisions of this Section 10.4,
so long
as the sum of such loans and advances does not exceed $25,000,000 in the
aggregate at any time;
(j) the
SUG
EAT Entities Loan directly to the SUG EAT Entities by ESSI as evidenced by
the
SUG EAT Loan Documents, provided
that the
principal amount of such loan does not exceed $1.6 billion any LDC Proceeds
shall be used for the repayment thereof and the provisions of Section 4.1(b)
shall be complied with;
(k) loans,
advances or other Investments by the Parent or any of its Subsidiaries not
otherwise permitted under the other provisions of this Section 10.4, so long
as
the sum of the outstanding balance of all of such loans and advances and
the
purchase price paid for all of such other Investments does not exceed in
the
aggregate seven percent (7%) of the Consolidated Net Worth of the Parent
and its
Subsidiaries as of the applicable determination date; provided,
however,
that,
except to the extent permitted pursuant to Section 10.4(j), neither the Parent
nor any other Subsidiaries of the Parent (other than the SUG Partnership
Entities) may make loans or advances to or make other Investments in any
of the
SUG Partnership Entities at any time prior to the consummation of the Acquired
Business Equity Interests Transfer; and
(l) to
the
extent applicable, the applicable Subsidiaries of the Parent may consummate
the
Xxx Xxxxxxxxxx Acquisition in accordance with the terms of the Xxx Xxxxxxxxxx
Acquisition Documents.
Notwithstanding
the foregoing in this Section 10.4, any net cash proceeds received in connection
with any Asset Sale by the Parent or any of its Subsidiaries shall be applied
in
accordance with Sections 4.1(b) and 4.1(c).
10.5 Stock
and Debt of Subsidiaries
The
Borrowers will not, and will not permit any of their respective Subsidiaries
to,
sell or otherwise dispose of any shares of stock, other equity interests
or Debt
of any of its Subsidiaries, or permit any of its Subsidiaries to issue or
dispose of its stock (other than directors’ qualifying shares), except for the
following: (i) the sale, transfer or issuance of stock, other equity interests
or Debt of any of the Parent’s Subsidiaries to the Parent or another Subsidiary
of the Parent, other than to any of the SUG Partnership Entities at any time
prior to the consummation of the Acquired Business Equity Interests Transfer,
except to the extent prohibited by Section 10.19; (ii) the sale of stock
in Sea
Xxxxx Pipeline Company and Debt of Sea Xxxxx Pipeline Company, (iii) the
issuance by Southern Union Trusts of preferred beneficial interests in public
offerings of the Parent’s Structured Securities, and (iv) the issuance by other
Subsidiaries of the Parent formed for the purpose of issuing Equity-Preferred
Securities. Notwithstanding the foregoing in this Section 10.5, any net cash
proceeds received in connection with any Asset Sale by the Parent or any
of its
Subsidiaries shall be applied in accordance with Sections 4.1(b) and
4.1(c).
10.6 Merger,
Consolidation, Etc.
The
Borrowers will not, and will not permit any of their respective Subsidiaries
to,
merge or consolidate with any other Person or sell, lease, transfer or otherwise
dispose of (whether in one transaction or a series of transactions) all or
a
substantial part of its assets or acquire (whether in one transaction or
a
series of transactions) all or a substantial part of the assets of any Person,
except that:
(a) except
to
the extent prohibited by Section 10.19, any of its Subsidiaries may merge
or
consolidate with the Parent (provided
that the
Parent shall be the continuing or surviving corporation) or with any one
or more
Subsidiaries of the Parent, other than any of the SUG Partnership Entities
at
any time prior to the consummation of the Acquired Business Equity Interests
Transfer;
(b) except
to
the extent prohibited by Section 10.19, any of its Subsidiaries may sell,
lease,
transfer or otherwise dispose of any of its assets to the Parent or any other
of
its Subsidiaries, other than to any of the SUG Partnership Entities at any
time
prior to the consummation of the Acquired Business Equity Interests Transfer;
(c) the
applicable Subsidiaries of the Parent may acquire the Acquired Business Equity
Interests pursuant to the Acquired Business Equity Interests
Transfer;
(d) the
Parent may acquire the assets of any Person, provided
that,
after giving effect to such acquisition, the Borrower is in compliance with
the
provisions of Sections 10.1(a), 10.1(b) and 10.1(d);
(e) the
Parent or any of its Subsidiaries may sell, lease, assign or otherwise dispose
of assets as otherwise permitted under Section 10.8, except to the extent
prohibited by Section 10.19; and
(f) to
the
extent applicable, the applicable Subsidiaries of the Parent may consummate
the
Xxx Xxxxxxxxxx Acquisition in accordance with the terms of the Xxx Xxxxxxxxxx
Acquisition Documents.
Notwithstanding
the foregoing in this Section 10.6, any net cash proceeds received in connection
with any Asset Sale by the Parent or any of its Subsidiaries shall be applied
in
accordance with Sections 4.1(b) and 4.1(c).
10.7 Supply
and Purchase Contracts
The
Borrowers will not, and will not permit any of their respective Subsidiaries
to,
enter into or be a party to any contract for the purchase of materials, supplies
or other property if such contract requires that payment for such materials,
supplies or other property shall be made regardless of whether or not delivery
is ever made or tendered of such materials, supplies and other property,
except
in those circumstances and involving those supply or purchase contracts that
the
Borrowers reasonably considers to be necessary or helpful in its operations
in
the ordinary course of business and that the Borrowers reasonably consider
not
to be unnecessarily burdensome on the Parent or its Subsidiaries.
10.8 Sale
or Other Disposition of Assets
The
Borrowers will not, and will not permit any of their respective Subsidiaries
to,
except as permitted under this Section 10.8, sell, assign, lease, or otherwise
dispose of (whether in one transaction or in a series of transactions) all
or
any part of its Property (whether now owned or hereafter acquired); provided,
however,
that
(i) the Parent or any of its Subsidiaries may in the ordinary course of business
dispose of (a) Property consisting of Inventory; and (b) Property consisting
of
goods or equipment that are, in the opinion of the Parent or any of its
Subsidiaries, obsolete or unproductive, but if in the good faith judgment
of the
Parent or such Subsidiary such disposition without replacement thereof would
have a Material Adverse Effect, such goods and equipment shall be replaced,
or
their utility and function substituted, by new or existing goods or equipment;
(ii) the Parent may transfer or dispose of any of its Significant Property
(in any transaction or series of transactions) to any Subsidiary or Subsidiaries
of the Parent (other than to any of the SUG Partnership Entities at any time
prior to the consummation of the Acquired Business Equity Interests Transfer),
only if such Property so transferred or disposed of after the Existing Revolving
Credit Facility Closing Date has an aggregate value (determined after
depreciation and in accordance with GAAP) of not more than ten percent (10%)
of
the aggregate value of all of the Parent’s and its Subsidiaries’ real property
and tangible personal property other than Inventory considered on a consolidated
basis and determined after depreciation and in accordance with GAAP, as of
September 30, 2005; (iii) the Parent may dispose of its real property in
one or
more sale/leaseback transactions, provided
that any
Debt incurred in connection with such transaction does not create a Default
as
defined herein; (iv) a Southern Union Trust may distribute the Parent’s
subordinated debt securities constituting a portion of the Structured
Securities, on the terms and under the conditions set out in the registration
statement therefor filed with the Securities and Exchange Commission on March
25, 1995 or any similar registration statement filed with the Securities
and
Exchange Commission in connection with any other Structured Securities issued
in
connection with the Prior Acquisitions; (v) except to the extent prohibited
by Section 10.19, the Parent or any of its Subsidiaries may dispose of real
property or tangible personal property other than Inventory (in consideration
of
such amount as in the good faith judgment of the Parent or such Subsidiary
represents a fair consideration therefor), provided
that the
aggregate value of such property disposed of (determined after depreciation
and
in accordance with GAAP) after the Existing Revolving Credit Facility Closing
Date does not exceed ten percent (10%) of the aggregate value of all of the
Parent’s and its Subsidiaries’ real property and tangible personal property
other than Inventory considered on a consolidated basis and determined after
depreciation and in accordance with GAAP, as of September 30, 2005; provided,
however,
that no
such disposition shall be made to any of the SUG Partnership Entities at
any
time prior to the consummation of the Acquired Business Equity Interests
Transfer; (vi) the Parent may dispose of Qualifying Assets of the type
described in clause (ii) of the definition of Qualifying Assets, except to
the
extent prohibited by Section 10.19; provided,
however,
that no
such disposition shall be made to any of the SUG Partnership Entities at
any
time prior to the consummation of the Acquired Business Equity Interests
Transfer; (vii) the Parent may dispose of other Investments of the type
acquired under the terms of Section 10.4(h); (viii) the Parent may sell all
stock or all or substantially all of the assets in Sea Xxxxx Pipeline Company;
(ix) the Parent may consummate the Qualified Transaction so long as the Parent
shall be in full compliance with all the provisions set forth in the definition
of “Qualified Transaction”; (x) the SUG Purchasers may assign all of their
rights, title and interest in and to Xxx Xxxxxxxxxx Acquisition Agreement
and
related documents to the SUG EAT Entities pursuant to and in accordance with
the
Xxx Xxxxxxxxxx Acquisition Agreement Assignment; and (xi) ESSI may assign
its
rights and interests in and to the SUG EAT Entities Loan Documents to the
Parent
or any other Subsidiary of the Parent (other than any of the SUG Partnership
Entities) so long as at the time of such assignment the assignee becomes
a party
to the Intercreditor Agreement pursuant to a joinder agreement in form and
substance satisfactory to the Agent.
Notwithstanding
the foregoing in this Section 10.8, any net cash proceeds received in connection
with any Asset Sale by the Parent or any of its Subsidiaries shall be applied
in
accordance with Sections 4.1(b) and 4.1(c).
10.9 Discount
or Sale of Receivables
The
Borrowers will not, and will not permit any of their respective Subsidiaries,
other than Southern Union Total Energy Services, Inc., to discount or sell
with
recourse, or sell for less than the face value thereof (including any accrued
interest) any of its notes receivable, receivables under leases or other
accounts receivable. Notwithstanding the foregoing to the contrary in this
Agreement, the Borrowers will not, and the Borrowers will not permit ESSI
to,
transfer, convey, assign, sell, or otherwise dispose of any of the SUG EAT
Entities Loan Documents or any loans evidenced thereby.
10.10 Change
in Accounting Method
The
Borrowers will not, and will not permit any of their respective Subsidiaries
to,
make any change in the method of computing depreciation for either tax or
book
purposes or any other material change in accounting method representing any
departure from GAAP without the Majority Banks’ prior written
approval.
10.11 Restricted
Payment
(a) The
Parent will not pay or declare any Restricted Payment unless immediately
prior
to such payment and after giving effect to such payment, the Parent could
incur
at least $1 of additional Debt by meeting the requirements of clauses (i)
and
(ii) of Section 10.3(g) and after giving effect thereto no Default or Event
of Default exists hereunder; provided,
however,
that
the Parent’s ability to purchase or agree to purchase its common stock and/or
preferred equity securities (including without limitation, Equity-Preferred
Securities) shall be limited as follows: (a) not more than $50,000,000 in
the
aggregate of common stock and preferred equity securities may be repurchased
per
each fiscal year of the Parent at any time the ratio of Consolidated Total
Indebtedness to Consolidated Total Capitalization for the Parent and its
Subsidiaries is greater than 0.60 to 1.00; (b) not more than $100,000,000
in the
aggregate of common stock and preferred equity securities may be repurchased
per
each fiscal year of the Parent at any time the ratio of Consolidated Total
Indebtedness to Consolidated Total Capitalization for the Parent and its
Subsidiaries is less than or equal to 0.60 to 1.00; and (c) no repurchases
of
common stock or preferred equity securities may be made if the Parent’s
unsecured, non-credit enhanced senior debt as specified by S&P and Xxxxx’x
falls below either BBB- or Baa3, respectively.
(b) At
any
time prior to the consummation of the Acquired Business Equity Interests
Transfer, the Borrowers shall cause each of the SUG Partnership Entities
to not
make a Restricted Payment to any Person other than a cash dividend payment
to
the holder of such Partnership Company’s Equity Interests, provided that such
cash dividend payment is used solely by SUG EAT LLC to pay the management
fees
owing to Southern Union Panhandle pursuant to the SUG Management
Agreement.
10.12 Securities
Credit Regulations
None
of
the Borrowers or any of their respective Subsidiaries will take or permit
any
action which might cause the Loans or this Agreement or any other Loan Document
to violate Regulation G, Regulation T, Regulation U, Regulation X or any
other
regulation of the Board of Governors of the Federal Reserve System or a
violation of the Securities Exchange Act of 1934, in each case as now or
hereafter in effect.
10.13 Nature
of Business; Management
The
Borrowers will not, and will not permit any of their respective Subsidiaries
to:
(a) change its principal line of business; or (b) enter into any business
not
within the scope of Section 7.15 and the definition of Qualifying Assets;
or (c)
permit any material overall change in the management of the Parent.
10.14 Transactions
with Related Parties
The
Borrowers will not, and will not permit any of their respective Subsidiaries
to,
enter into any transaction or agreement with any officer, director or holder
of
ten percent (10%) or more of any class of the outstanding capital stock of
the
Parent or any of its Subsidiaries (or any Affiliate of any such Person) unless
the same is upon terms substantially similar to those obtainable from wholly
unrelated sources.
10.15 Hazardous
Materials
The
Borrowers will not, and will not permit any of their respective Subsidiaries
to
(a) cause or permit any Hazardous Materials to be placed, held, used, located,
or disposed of on, under or at any of such Person’s property or any part thereof
by any Person in a manner which could reasonably be expected to have a Material
Adverse Effect; (b) cause or permit any part of any of such Person’s property to
be used as a manufacturing, storage, treatment or disposal site for Hazardous
Materials, where such action could reasonably be expected to have a Material
Adverse Effect; or (c) cause or suffer any liens to be recorded against any
of
such Person’s property as a consequence of, or in any way related to, the
presence, remediation, or disposal of Hazardous Materials in or about any
of
such Person’s property, including any so-called state, federal or local
“superfund” lien relating to such matters, where such recordation could
reasonably be expected to have a Material Adverse Effect.
10.16 Limitations
on Payments on Subordinated Debt
The
Borrowers will not, and will not permit any of their respective Subsidiaries
to,
make any payment in respect of interest on, principal of, or otherwise relating
to, the Parent’s
subordinated debt securities issued in connection with the Structured Securities
if, after giving effect to such payment, a Default or Event of Default would
exist.
10.17 No
Agreements
Prohibiting Pledge of Southern Union Panhandle and
Panhandle Eastern Equity Interests
Neither
Borrower will
enter into any contract or other agreement with any Person that directly
or
indirectly prohibits the Parent
from
granting any Lien against the Equity Interests in any of (x) Southern Union
Panhandle and (y) Panhandle Eastern at any time owned and held by the
Parent
as
security for any Debt of the Parent
or
any of
its Subsidiaries.
10.18 No
Agreements Prohibiting Pledge of the Xxx Xxxxxxxxxx Acquired
Business
Equity Interests.
The
Borrowers will not, and the Borrowers will cause their respective Subsidiaries
to not, enter into any contract or other agreement with any Person that directly
or indirectly prohibits any of the Parent or any Subsidiary of the Parent
from
granting any Lien against the Equity Interests in (x) SRES, (y) REM or (z)
Leapartners, in each case at any time owned and held by such Person as security
for any Debt of the Borrower or any of its Subsidiaries.
10.19 Restriction
on Transfer
Neither
the Parent nor any of its Subsidiaries shall, and the Borrower shall cause
each
of its Subsidiaries not to:
(a) sell,
lease, exchange, assign, transfer, dispose of, contribute or dividend (i)
any
Equity Interests in any of the Subsidiaries that holds any of the Acquired
Business Equity Interests or (ii) any Collateral; provided,
however,
that
(A) unless an Event of Default shall have occurred and be continuing, any
of the
Borrower’s Subsidiaries shall be entitled to dividend any cash Distributions
constituting Collateral to any of the Borrowers or any of its other Subsidiaries
to the extent permitted pursuant to Section 10.11(b) and (B) the applicable
Subsidiaries of the Parent may transfer, convey or assign the Collateral
to
another wholly-owned Subsidiary of the Parent (other than the SUG Partnership
Entities) in connection with the Acquired Business Equity Interests Transfer;
or
(b) merge
or
consolidate any of (i) Southern Union Panhandle, (ii) Panhandle Eastern,
(iii)
any Subsidiary of the Borrower that holds any of the Acquired Business Equity
Interests, (iv) REM, (v) SRES or (vi) Leapartners, in each case with and
into
any other Person; or
(c) create,
incur, assume or otherwise suffer to exist any Lien on the Collateral or
any
part thereof, except for the Liens created by the Collateral Documents and
except for, in the case of the SUG EAT Entities Collateral only, at any time
prior to the consummation of the Acquired Business Interests Transfer, the
Permitted Subordinated Lien created by the SUG EAT Entities Loan Documents;
or
(d) sell,
lease, exchange, assign, transfer, dispose of, contribute or dividend all
or
substantially all of the assets of any of the Partnership Companies or Panhandle
Eastern to the Parent or any other Subsidiary of the Parent or any Affiliate
of
the Parent.
11. EVENTS
OF DEFAULT; REMEDIES
11.1 If
any of
the following events shall occur
then
the
Agent shall at the request, or may with the consent, of the Majority Banks,
(a)
by notice to the Borrowers, declare the Commitment of each Bank and the several
obligation of each Bank to make Loans hereunder to be terminated, whereupon
the
same shall forthwith terminate, and (b) declare the Loans and the Notes and
all
interest accrued and unpaid thereon, and all other amounts payable under
the
Notes, this Agreement and the other Loan Documents, to be forthwith due and
payable, whereupon the Loans, the Notes, all such interest and all such other
amounts, shall become and be forthwith due and payable without presentment,
demand, protest, or further notice of any kind (including, without limitation,
notice of default, notice of intent to accelerate and notice of acceleration),
all of which are hereby expressly waived by the Borrowers; provided,
however,
that
with respect to any Event of Default described in Sections 11.1(G) or 11.1(H)
hereof, (i) the Commitment of each Bank and the obligation of the Banks to
make
Loans shall automatically be terminated and (ii) the entire unpaid principal
amount of the Loans and the Notes, all interest accrued and unpaid thereon,
and
all such other amounts payable under the Notes, this Agreement and the other
Loan Documents, shall automatically become immediately due and payable, without
presentment demand, protest, or any notice of any kind (including, without
limitation, notice of default, notice of intent to accelerate and notice
of
acceleration), all of which are hereby expressly waived by the
Borrowers:
(A) Failure
to Pay Principal or Interest
Any
Borrower does not pay, repay or prepay any principal of or interest on any
Loan
when and as the same shall become due and payable, whether at the due date
thereof or at a date fixed for prepayment (whether voluntary or mandatory)
thereof or by acceleration thereof or otherwise; or
(B) Failure
to Pay Fee or Other Amounts
Any
Borrower does not pay any fee or any other obligation or amount payable under
this Agreement or the other Loan Documents, within five (5) calendar days
after
the same shall have become due; or
(C) Failure
to Pay Other Debt
Any
Borrower or any of its Subsidiaries fails to pay principal or interest on
any
Debt (other than the Obligations) aggregating more than $3,000,000.00 when
due
and any related grace period has expired, or the holder of any of such other
Debt declares such Debt due prior to its stated maturity because of the such
Borrower’s or any such Subsidiary’s default thereunder and the expiration of any
related grace period; or
(D) Misrepresentation
or Breach of Warranty
Any
representation or warranty made by any Loan Party herein or in any other
Loan
Document or otherwise furnished to the Agent or any Bank in connection with
this
Agreement or any other Loan Document shall be incorrect, false or misleading
in
any material respect when made; or
(E) Violation
of Certain Covenants
(i)
Any Borrower violates any covenant, agreement or condition contained in Section
9.12, 9.13, 9.14, 10.1(a), 10.1(b), 10.1(d), 10.2, 10.3, 10.4, 10.5, 10.6,
10.8,
10.9, 10.10, 10.11, 10.15, 10.17, 10.18 or 10.19; or (ii) any Borrower or
any
other Loan Party violates any covenant, agreement or condition contained
in
Section 4(d) of the applicable Pledge Agreement; or
(F) Violation
of Other Covenants, Etc
(i)
Any Borrower violates any other covenant, agreement or condition contained
herein or in any other Loan Document (other than the covenants, agreements
and
conditions set forth or described in clauses (A), (B), (C), (D) and (E) of
this
Section 11.1) and such violation shall not have been remedied within (30)
days
after the earlier of (i) actual discovery by any Borrower of such violation
or
(ii) written notice has been received by the Borrowers from the Agent, any
Bank,
or any holder of a Note; or (ii) any Loan Party (other than the Borrowers)
violates any other covenant, agreement or condition contained in any Collateral
Document (other than the covenants, agreements and conditions set forth or
described in clause (E)(ii) of this Section 11.1) and such violation shall
not
have been remedied within (30) days after the earlier of (i) actual discovery
by
any Borrower or such Loan Party of such violation or (ii) written notice
has
been received by the Borrowers from the Bank or the holder of the Note; or
(G) Bankruptcy
and Other Matters
Any
Borrower, any of its respective Subsidiaries or any other Loan Party (a)
makes
an assignment for the benefit of creditors; or (b) admits in writing its
inability to pay its debts generally as they become due; or (c) generally
fails
to pay its debts as they become due; or (d) files a petition or answer seeking
for itself, or consenting to or acquiescing in, any reorganization, arrangement,
composition, readjustment, liquidation, dissolution, or similar relief under
any
applicable Debtor Law (including, without limitation, the Federal Bankruptcy
Code); or (i) there is appointed a receiver, custodian, liquidator, fiscal
agent, or trustee of any Borrower, any of its respective Subsidiaries or
any
other Loan Party or of the whole or any substantial part of their respective
assets; or (ii) any court enters an order, judgment or decree approving a
petition filed against any Borrower, any of its respective Subsidiaries or
any
other Loan Party seeking reorganization, arrangement, composition, readjustment,
liquidation, dissolution, or similar relief under any Debtor Law and either
such
order, decree or judgment so filed against it is not dismissed or stayed
(unless
and until such stay is no longer in effect) within thirty (30) days of entry
thereof or an order for relief is entered pursuant to any such law;
or
(H) Dissolution
Any
order
is entered in any proceeding against any Borrower, any of its respective
Subsidiaries or any other Loan Party decreeing the dissolution, liquidation,
winding-up or split-up of the Parent or such Subsidiary, and such order remains
in effect for thirty (30) days; or
(I) Undischarged
Judgment
Final
Judgment or judgments in the aggregate, that might be or give rise to Liens
on
any property of any Borrower, any of its respective Subsidiaries or any other
Loan Party for the payment of money in excess of $5,000,000.00 shall be rendered
against any Borrower, any of its respective Subsidiaries or any other Loan
Party, and the same shall remain undischarged for a period of thirty (30)
days
during which execution shall not be effectively stayed; or
(J) Environmental
Matters
The
occurrence of any of the following events that could result in liability
to the
Parent or any of its Subsidiaries under any Environmental Law or the creation
of
a Lien on any property of the Parent or any of its Subsidiaries in favor
of any
Governmental Authority or any other Person for any liability under any
Environmental Law or for damages arising from costs incurred by such Person
in
response to a Release or threatened Release of Hazardous Materials into the
environment if any such asserted liability or Lien exceeds $10,000,000.00
and if
any such lien would cover any property of the Parent or any of its Subsidiaries
which property is or would reasonably be considered to be integral to the
operations of the Parent or any of its Subsidiaries in the ordinary course
of
business:
(a) the
Release of Hazardous Materials at, upon, under or within the property owned
or
leased by the Parent or any of its Subsidiaries or any contiguous property;
or
(b) the
receipt by the Parent or any of its Subsidiaries of any summons, claim,
complaint, judgment, order or similar notice that it is not in compliance
with
or that any Governmental Authority is investigating its compliance with any
Environmental Law; or
(c) the
receipt by the Parent or any of its Subsidiaries of any notice or claim to
the
effect that it is or may be liable for the Release or threatened Release
of
Hazardous Materials into the environment; or
(d) any
Governmental Authority incurs costs or expenses in response to the Release
of
any Hazardous Material which affects in any way the properties of the Parent
or
any of its Subsidiaries; or
(K) Default
under the Existing Revolving Credit Facility.
An
Event
of Default (as defined under the credit agreement evidencing the Existing
Revolving Credit Facility) shall occur under the Existing Revolving Credit
Facility;
or
(L) Change
in Control
A
Change
in Control has occurred;.
(M) Change
in Ownership
At
any
time prior to the consummation of the Acquired Business Equity Interests
Transfer: (i) CDEC shall cease to directly own 100% of all issued and
outstanding Equity Interests in SUG EAT Inc.; (ii) SUG EAT Inc. shall cease
to
directly own 100% of all issued and outstanding Equity Interests in SUG EAT
LLC;
(iii) SUG EAT Inc. shall cease to own (x) 100% of all issued and outstanding
limited partner interests in SRES and (y) 100% of all issued and outstanding
limited partner interests in REM; (iv) SUG EAT LLC shall cease to own (x)
100%
of all issued and outstanding general partner interests in SRES, (y) 100%
of all
issued and outstanding general partner interests in REM and (z) 100% of all
issued and outstanding general partner interests in Leapartners; or (v) any
Person (other than SUG EAT Inc. and SUG EAT LLC) identified in Schedule
7.1(B)
as an
“owner” shall cease to own and hold the percentage of the Equity Interests set
forth in such Schedule
7.1(B)
in the
Person identified opposite such owner’s name in such Schedule
7.1(B);
or
(N) Invalidity
of Lien on Collateral.
Any
Collateral Document shall for any reason (other than pursuant to the terms
thereof) cease to create a valid and perfected lien on and security interest
in
(having the first priority as required by the terms of the Collateral Documents)
any material portion of the Collateral purported to be covered thereby (or
any
Loan Party shall so assert or shall take any action to discontinue or to
assert
the invalidity or unenforceability thereof); or the Intercreditor Agreement
shall fail to constitute the valid, binding and enforceable agreement of
ESSI in
accordance with the terms thereof, or ESSI shall so assert in writing;
or
(O) Restricted
SUG EAT Entities Activities.
Any
SUG
EAT Entity engages in or conducts any trade or business activities, becomes
or
otherwise is liable for any obligations or indebtedness, holds or owns any
properties or assets, enters into any transaction with any Person, or grants
or
pledges a Lien on any part of the Collateral owned by it to any Person other
than the Agent, other than the following (collectively, the “SUG
EAT Entities Permitted Activities”):
(i) (A) in the case of SUG EAT Inc., its ownership of (x) 100% of the
limited partner interests in SRES and (y) 100% of the limited partner interests
in REM; and (B) in the case of SUG EAT LLC, its ownership of (x) 100% of
the
general partner interests in SRES, (y) 100% of the general partner interests
in
REM and (z) 100% of the general partner interests in Leapartners, (ii) the
incurrence of indebtedness under, and be liable for its respective obligations
owing to ESSI under, the SUG EAT Entities Loan Documents; (iii) grant and
pledge
a Lien on the Collateral owned by it pursuant to the Collateral Document;
(iv)
its respective obligations under the Collateral Documents; (v) consummate
the
Acquired Business Equity Interests Transfer; (vi) receive any LDC Proceeds
pursuant to a Qualified Transaction; and (vii) the grant of the Permitted
Subordinated Lien pursuant to the SUG EAT Entities Loan Documents; and
(viii) activities incidental to the foregoing clauses (i) through (vi)
above; or
(P) Modifications.
At
any
time prior to the consummation of the Acquired Business Equity Interests
Transfer, any provision of any of the following shall have be modified, waived,
amended, supplemented, amended and restated or terminated: (i) any of the
SUG
EAT Entities Transaction Documents; (ii) any Organizational Document of any
SUG
EAT Entity; or (iii) any agreement or document entered into between CDEC
and the
Parent in connection with the Qualified Transaction.
11.2 Other
Remedies
In
addition to and cumulative of any rights or remedies expressly provided for
in
this Section 11, if any one or more Events of Default shall have occurred,
the
Agent shall at the request, and may with the consent, of the Majority Banks
proceed to protect and enforce the rights of the Banks hereunder by any
appropriate proceedings. The Agent shall at the request, and may with the
consent, of the Majority Banks also proceed either by the specific performance
of any covenant or agreement contained in this Agreement or any other Loan
Document or by enforcing the payment of the Loans or by enforcing any other
legal or equitable right provided under this Agreement or the Notes or any
other
Loan Document or otherwise existing under any law in favor of the Banks and
the
holder of the Notes.
11.3 Remedies
Cumulative
No
remedy, right or power conferred upon the Agent or any of the Banks is intended
to be exclusive of any other remedy, right or power given hereunder or now
or
hereafter existing at law, in equity, or otherwise, and all such remedies,
rights and powers shall be cumulative.
12. THE
AGENT
12.1 Authorization
and Action
Each
Bank
hereby appoints LCPI as its Agent under the Loan Documents and irrevocably
authorizes the Agent (subject to Sections 12.1 and 12.7) to take such action
as
the Agent on its behalf and to exercise such powers under this Agreement
and the
other Loan Documents as are delegated to the Agent by the terms thereof,
together with such powers as are reasonably incidental thereto. Without
limitation of the foregoing, each Bank expressly authorizes the Agent to
execute, deliver, and perform its obligations under this Agreement and the
other
Loan Documents, and to exercise all rights, powers, and remedies that the
Agent
may have hereunder and thereunder. As to any matters not expressly provided
for
by this Agreement or any other Loan Document (including, without limitation,
enforcement or collection of the Obligations and any Loan Document), the
Agent
shall not be required to exercise any discretion or take any action, but
shall
be required to act, or to refrain from acting (and shall be fully protected
in
so acting or refraining from acting), upon the instructions of the Majority
Banks, and such instructions shall be binding upon all the Banks and all
holders
of any Note; provided,
however,
that
the Agent shall not be required to take any action which exposes the Agent
to
personal liability or which is contrary to this Agreement or any other Loan
Document or applicable law. The Agent agrees to give to each Bank prompt
notice
of each notice given to it by the Borrowers pursuant to the terms of this
Agreement.
12.2 Agent’s
Reliance, Etc
Neither
the Agent nor any of its directors, officers, agents, or employees shall
be
liable to any Bank for any action taken or omitted to be taken by it or them
under or in connection with this Agreement, the Notes and the other Loan
Documents, except for its or their own gross negligence or willful misconduct.
Without limitation of the generality of the foregoing, the Agent: (a) may
treat
the original or any successor holder of any Note as the holder thereof until
the
Agent receives notice from the Bank which is the payee of such Note concerning
the assignment of such Note; (b) may employ and consult with legal counsel
(including counsel for the Borrowers), independent public accountants, and
other
experts selected by it and shall not be liable to any Bank for any action
taken,
or omitted to be taken, in good faith by it or them in accordance with the
advice of such counsel, accountants, or experts received in such consultations
and shall not be liable for any negligence or misconduct of any such counsel,
accountants, or other experts; (c) makes no warranty or representation to
any
Bank and shall not be responsible to any Bank for any opinions, certifications,
statements, warranties, or representations made in or in connection with
this
Agreement or any other Loan Document; (d) shall not have any duty to any
Bank to
ascertain or to inquire as to the performance or observance of any of the
terms,
covenants, or conditions of this Agreement or any other Loan Document or
any
other instrument or document furnished pursuant thereto or to satisfy itself
that all conditions to and requirements for any Loan have been met or that
the
Borrowers are entitled to any Loan or to inspect the property (including
the
books and records) of the Parent or any of it Subsidiaries; (e) shall not
be
responsible to any Bank for the due execution, legality, validity,
enforceability, genuineness, sufficiency, or value of this Agreement or any
other Loan Document or any other instrument or document furnished pursuant
thereto; and (f) shall incur no liability under or in respect of this Agreement
or any other Loan Document by acing upon any notice, consent, certificate,
or
other instrument or writing (which may be by telegram, cable, telex, or
otherwise) believed by it to be genuine and signed or sent by the proper
party
or parties.
12.3 Defaults
The
Agent
shall not be deemed to have knowledge of the occurrence of a Default (other
than
the nonpayment of principal of or interest hereunder or of any fees) unless
the
Agent has received notice from a Bank or the Borrowers specifying such Default
and stating that such notice is a Notice of Default. In the event that the
Agent
receives such a notice of the occurrence of a Default, the Agent shall give
prompt notice thereof to the Banks (and shall give each Bank prompt notice
of
each such nonpayment). The Agent shall (subject to Section 12.7) take such
action with respect to such Default; provided
that,
unless and until the Agent shall have received the directions referred to
in
Sections 12.1 or 12.7, the Agent may (but shall not be obligated to) take
such
action, or refrain from taking such action, with respect to such Default
as it
shall deem advisable and in the best interest of the Banks.
12.4 LCPI
and Affiliates
With
respect to its Commitment, any Loan made by it, and the Note issued to it,
LCPI
shall have the same rights and powers under this Agreement as any other Bank
and
may exercise the same as though it were not the Agent; and the term “Bank” or
“Banks” shall, unless otherwise expressly indicated, include LCPI in its
individual capacity. The Agent and its respective Affiliates may accept deposits
from, lend money to, act as trustee under indentures of, and generally engage
in
any kind of business with, any Borrower, any of its respective Affiliates
and
any Person who may do business with or own securities of such Borrower or
any
such Affiliate, all as if LCPI were not the Agent and without any duty to
account therefore to the Banks.
12.5 Non-Reliance
on Agent and Other Banks
Each
Bank
agrees that it has, independently and without reliance on the Agent or any
other
Bank, and based on such documents and information as it has deemed appropriate,
made its own credit analysis of the Borrowers and each of its Subsidiaries
and
its decision to enter into the transactions contemplated by this Agreement
and
the other Loan Documents and that it will, independently and without reliance
upon the Agent or any other Bank, and based on such documents and information
as
it shall deem appropriate at the time, continue to make its own analysis
and
decisions in taking or not taking action under this Agreement or any other
Loan
Document. The Agent shall not be required to keep itself informed as to the
performance or observance by the Borrowers of this Agreement or any other
Loan
Document or to inspect the properties or books of the Parent or any of its
Subsidiaries. Except for notices, reports, and other documents and information
expressly required to be furnished to the Banks by the Agent hereunder, the
Agent shall not have any duty or responsibility to provide any Bank with
any
credit or other information concerning the affairs, financial condition,
or
business of the Parent or any of its Subsidiaries (or any of their Affiliates)
which may come into the possession of the Agent or any of its
Affiliates.
12.6 Indemnification
Notwithstanding
anything to the contrary herein contained, the Agent shall be fully justified
in
failing or refusing to take any action hereunder or under any other Loan
Document unless it shall first be indemnified to its satisfaction by the
Banks
against any and all liabilities, obligations, losses, damages, penalties,
actions, judgments, suits, costs, expenses, and disbursements of any kind
or
nature whatsoever which may be imposed on, incurred by or asserted against
the
Agent in any way relating to or arising out of its taking or continuing to
take
any action. Each Bank agrees to indemnify the Agent (to the extent not
reimbursed by the Borrowers), according to such Bank’s Pro Rata Percentage, from
and against any and all liabilities, obligations, losses, damages, penalties,
actions, judgments, suits, costs, expenses, and disbursements of any kind
or
nature whatsoever which may be imposed on, incurred by, or asserted against
the
Agent in any way relating to or arising out of any Loan Document or any action
taken or omitted by the Agent under any Loan Document; provided,
however,
that no
Bank shall be liable for any portion of such liabilities, obligations, losses,
damages, penalties, actions, judgments, suits, costs, expenses, or disbursements
resulting from the gross negligence or willful misconduct of the Person being
indemnified; and provided,
further,
however,
that it
is the intention of each Bank to indemnify the Agent against the consequences
of
the Agent’s own negligence, whether such negligence be sole, joint, concurrent,
active or passive. Without limitation of the foregoing, each Bank agrees
to
reimburse the Agent promptly upon demand for its Pro Rata Percentage of any
out-of-pocket expenses (including attorneys’ fees) incurred by the Agent in
connection with the preparation, administration, or enforcement of, or legal
advice in respect of rights or responsibilities under, this Agreement and
the
other Loan Documents, to the extent that the Agent is not reimbursed for
such
expenses by the Borrowers.
12.7 Successor
Agent
The
Agent
may resign at any time as Agent under this Agreement by giving written notice
thereof to the Banks and the Borrowers and may be removed at any time with
or
without cause by the Majority Banks. Upon any such resignation or removal,
the
Majority Banks shall have the right to appoint a successor Agent. If no
successor Agent shall have been so appointed by the Majority Banks or shall
have
accepted such appointment within thirty (30) days after the retiring Agent’s
giving of notice of resignation or the Majority Banks’ removal of the retiring
Agent, then the retiring Agent may, on behalf of the Banks, appoint a successor
Agent, which shall be a commercial bank organized under the laws of the United
States of America or of any State thereof and having a combined capital and
surplus of at least $500,000,000.00. Upon the acceptance of any appointment
as
Agent hereunder by a successor Agent, such successor Agent shall thereupon
succeed to and become vested with all the rights, powers, privileges and
duties
of the retiring Agent, and the retiring Agent shall be discharged from its
duties and obligations under this Agreement and the other Loan Documents.
After
any retiring Agent’s resignation or removal hereunder as Agent, the provisions
of this Section 12 shall inure to its benefit as to any actions taken or
omitted to be taken by it while it was Agent under this Agreement and the
other
Loan Documents.
12.8 Agent’s
Reliance
The
Borrowers shall notify the Agent in writing of the names of its officers
and
employees authorized to request a Loan on behalf of the Borrowers and shall
provide the Agent with a specimen signature of each such officer or employee.
The Agent shall be entitled to rely conclusively on such officer’s or employee’s
authority to request a Loan on behalf of the Borrowers until the Agent receives
written notice from the Borrowers to the contrary. The Agent shall have no
duty
to verify the authenticity of the signature appearing on any Notice of
Borrowing, and, with respect to any oral request for a Loan, the Agent shall
have no duty to verify the identity of any Person representing himself as
one of
the officers or employees authorized to make such request on behalf of the
Borrowers. Neither the Agent nor any Bank shall incur any liability to the
Borrowers or any other Loan Party in acting upon any telephonic notice referred
to above which the Agent or such Bank believes in good faith to have been
given
by a duly authorized officer or other Person authorized to borrow on behalf
of
the Borrowers or for otherwise acting in good faith.
13. MISCELLANEOUS
13.1 Representation
by the Banks
Each
Bank
represents that it is the intention of such Bank, as of the date of its
acquisition of its Note, to acquire the Note for its account or for the account
of its Affiliates, and not with a view to the distribution or sale thereof,
and,
subject to any applicable laws, the disposition of such Bank’s property shall at
all times be within its control. The Notes have not been registered under
the
Securities Act of 1933, as amended (the “Securities
Act”),
and
may not be transferred, sold or otherwise disposed of except (a) in a registered
offering under the Securities Act; (b) pursuant to an exemption from the
registration provisions of the Securities Act; or (c) if the Securities Act
shall not apply to the Notes or the transactions contemplated hereunder as
commercial lending transactions.
13.2 Amendments,
Waivers, Etc
No
amendment or waiver of any provision of any Loan Document, nor consent to
any
departure by the Borrowers or any other Loan Party therefrom, shall in any
event
be effective unless the same shall be in writing and signed by the applicable
Loan Parties and the Majority Banks, and then such waiver or consent shall
be
effective only in the specific instance and for the specific purpose for
which
given; provided,
however,
that no
amendment, waiver or consent shall, unless in writing and signed by each
Bank,
do any of the following: (a) waive any of the conditions specified in Section
8;
(b) increase the Commitment of any Bank or alter the term thereof, or subject
any Bank to any additional or extended obligations; (c) change the principal
of,
or rate of interest on, any Loan, any Note or any fees or other amounts payable
hereunder; (d) postpone any date fixed for any payment of principal of, or
interest on, any Loan, any Note or any fees or other amounts payable hereunder;
(e) change the percentage of the Commitments or of the aggregate unpaid
principal amount of any Loan, any Note or the number of Banks which shall
be
required for Banks, or any of them, to take any action hereunder; (f) amend
this
Section 13.2; or (g) release any of the Collateral from the Liens of the
Collateral Documents; and provided,
further,
that no
amendment, waiver, or consent shall, unless in writing and signed by the
Agent
in addition to each Bank, affect the rights or duties of the Agent under
any
Loan Document. No failure or delay on the part of any Bank or the Agent in
exercising any power or right hereunder shall operate as a waiver thereof
nor
shall any single or partial exercise of any such right or power, or any
abandonment or discontinuance of steps to enforce such a right or power,
preclude any other or further exercise thereof or the exercise of any other
right or power. No course of dealing between the Loan Parties and any Bank
or
the Agent shall operate as a waiver of any right of any Bank or the Agent.
No
modification or waiver of any provision of this Agreement or the Note or
any
other Loan Document nor consent to any departure by the Loan Parties therefrom
shall in any event be effective unless the same shall be in writing, and
then
such waiver or consent shall be effective only in the specific instance and
for
the purpose for which given. No notice to or demand on the Borrower or any
other
Loan Party in any case shall entitle the Borrowers to any other or further
notice or demand in similar or other circumstances.
13.3 Reimbursement
of Expenses
Each
Borrower jointly and severally agrees to reimburse each Bank for its reasonable
out-of-pocket expenses, including the reasonable fees and expenses of counsel
to
the Agent and each Bank, in connection with the transactions contemplated
by
this Agreement and the other Loan Documents, whether or not such contemplated
transactions shall be consummated, or any of them, or otherwise in connection
with this Agreement or any other Loan Documents, including its negotiation,
preparation, execution, administration, modification and enforcement, and
all
reasonable fees, including the reasonable fees and expenses of counsel to
the
Agent and each Bank, costs and expenses of the Agent for environmental
consultants and costs and expenses of the Agent and each Bank in connection
with
due diligence, transportation, computer time and research and duplication.
Borrower jointly and severally agrees to pay any and all stamp and other
taxes
which may be payable or determined to be payable in connection with the
execution and delivery of this Agreement or the other Loan Documents, and
to
save any Bank or holder of any Note harmless from any and all liabilities
with
respect to or resulting from any delay or omission to pay any such taxes.
The
obligations of the Borrowers under this Section 13.3 shall survive the
termination of this Agreement and/or the payment in full of the
Obligations.
13.4 Notices
All
notices and other communications provided for herein shall be in writing
(including telex, facsimile, or cable communication) and shall be mailed,
telecopied, telexed, cabled or delivered addressed as follows:
(a) If
to the
Borrowers, to it at: Southern
Union Company
Enhanced
Service Systems, Inc.
000
Xxxxxxxxxx Xxxxxx
Xxxxxxxx,
XX 00000
Attention:
Xx. Xxxxxxx X. Xxxxxxxx
Fax:
(000) 000-0000
with
copies to: Southern
Union Company
Enhanced
Service Systems, Inc.
0000
Xxxxxxxxxx Xxxx
Xxxxxxx,
Xxxxx 00000
Attention:
Xxxxxx Xxxxxxxx, Esq.
Fax:
(000) 000-0000
(b) If
to the
Agent, to it at: Xxxxxx
Commercial Paper Inc.
c/x
Xxxxxx Brothers Inc.
000
0xx
Xxxxxx, 0xx Xxxxx
Xxx
Xxxx,
XX 00000
Attn:
Xxxxxxxx Xxxxxxxxxx
Phone:
(000) 000-0000
Fax:
(000) 000-0000
and,
if
to any Bank, at the address specified below its name on the signature pages
hereof, and if to any other Loan Party, at the address specified above for
the
Borrowers, or as to the Borrowers, the Agent or any Bank, to such other address
as shall be designated by such party in a written notice to the other party
and,
as to each other party, at such other address as shall be designated by such
party in a written notice to the Borrowers and the Agent. All such notices
and
communications shall, when mailed, telecopied, telexed, transmitted, or cabled,
become effective when deposited in the mail, confirmed by telex answer back,
transmitted to the telecopier, or delivered to the cable company, except
that
notices and communications to the Agent under Sections 2.1(c), 2.1(d) or
2.2
shall not be effective until actually received by the Agent.
13.5 Governing
Law; Jurisdiction; Consent to Service of Process
(a) THIS
AGREEMENT AND THE NOTES SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE
WITH
THE LAWS OF THE STATE OF NEW YORK.
(b) Each
Borrower hereby irrevocably submits to the nonexclusive jurisdiction of The
United States District Court for the Southern District of New York and of
any
New York State Court sitting in the Borough of Manhattan in New York City
for
purposes of all legal proceedings arising out of or relating to any Loan
Document or the transactions contemplated thereby. Each Borrower hereby
irrevocably waives, to the fullest extent permitted by law, any objection
which
it may now or hereafter have to the laying of the venue of any such proceeding
brought in such a court and any claim that any such proceeding brought in
any
such court has been brought in an inconvenient forum. Nothing contained in
this
Section or in any other provision of any Loan Document (unless expressly
provided otherwise) shall be deemed or construed as an agreement by any Bank
to
be subject to the jurisdiction of such courts.
(c) Each
Borrower hereby consents to process being served in any suit, action or
proceeding relating hereto by mailing a copy thereof by registered or certified
air mail to its address designated pursuant to Section 13.4. Nothing contained
in this Section or in any other provision of any Loan Document will affect
the
right of any party hereto to serve process in any other manner permitted
by
law.
13.6 Survival
of Representations, Warranties and Covenants
All
representations, warranties and covenants contained herein or made in writing
by
any Loan Party in connection herewith shall survive the execution and delivery
of this Agreement and the other Loan Documents, and will bind and inure to
the
benefit of the respective successors and assigns of the parties hereto, whether
so expressed or not; provided,
however,
that
the undertaking of the Banks to make the Loans to the Borrowers shall not
inure
to the benefit of any successor or assign of the Borrowers. No investigation
at
any time made by or on behalf of the Banks shall diminish the Banks’ rights to
rely on any representations made herein or in connection herewith. All
statements contained in any certificate or other written instrument delivered
by
any Loan Party or by any Person authorized by such Loan Party under or pursuant
to this Agreement or any other Loan Document or in connection with the
transactions contemplated hereby or thereby shall constitute representations
and
warranties hereunder as of the time made by the Borrowers.
13.7 Counterparts
This
Agreement may be executed in several counterparts, and by the parties hereto
on
separate counterparts, and each counterpart, when so executed and delivered,
shall constitute an original instrument and all such separate counterparts
shall
constitute but one and the same instrument.
13.8 Severability
Should
any clause, sentence, paragraph or section of this Agreement be judicially
declared to be invalid, unenforceable or void, such decision shall not have
the
effect of invalidating or voiding the remainder of this Agreement, and the
parties hereto agree that the part or parts of this Agreement so held to
be
invalid, unenforceable or void will be deemed to have been stricken herefrom
and
the remainder will have the same force and effectiveness as if such part
or
parts had never been included herein. Each covenant contained in this Agreement
shall be construed (absent an express contrary provision herein) as being
independent of each other covenant contained herein, and compliance with
any one
covenant shall not (absent such an express contrary provision) be deemed
to
excuse compliance with one or more other covenants.
13.9 Descriptive
Headings
The
section headings in this Agreement have been inserted for convenience only
and
shall be given no substantive meaning or significance whatsoever in construing
the terms and provisions of this Agreement.
13.10 Accounting
Terms
All
accounting terms used herein which are not expressly defined in this Agreement,
or the respective meanings of which are not otherwise qualified, shall have
the
respective meanings given to them in accordance with GAAP.
13.11 Limitation
of Liability
No
claim
may be made by any Borrower or any other Person against the Agent or any
Bank or
the Affiliates, directors, officers, employees, attorneys, or agents of the
Agent or any Bank for any special, indirect, consequential, or punitive damages
in respect to any claim for breach of contract arising out of or related
to the
transactions contemplated by this Agreement, or any act, omission, or event
occurring in connection herewith and each Borrower hereby waives, releases,
and
agrees not to xxx upon any claim for any such damages, whether or not accrued
and whether or not known or suspected to exist in its favor.
13.12 Set-Off
Each
Borrower hereby gives and confirms to each Bank a right of set-off of all
moneys, securities and other property of such Borrower (whether special,
general
or limited) and the proceeds thereof, now or hereafter delivered to remain
with
or in transit in any manner to such Bank, its Affiliates, correspondents
or
agents from or for such Borrower, whether for safekeeping, custody, pledge,
transmission, collection or otherwise or coming into possession of such Bank,
its Affiliates, correspondents or agents in any way, and also, any balance
of
any deposit accounts and credits of such Borrower with, and any and all claims
of security for the payment of the Obligations and of all other liabilities
and
obligations now or hereafter owed by such Borrower to such Bank, contracted
with
or acquired by such Bank, whether such liabilities and obligations be joint,
several, absolute, contingent, secured, unsecured, matured or unmatured,
and
such Borrower hereby authorizes each Bank, its Affiliates, correspondents
or
agents at any time or times, without prior notice, to apply such money,
securities, other property, proceeds, balances, credits of claims, or any
part
of the foregoing, to such liabilities in such amounts as it may select, whether
such liabilities be contingent, unmatured or otherwise, and whether any
collateral security therefor is deemed adequate or not. The rights described
herein shall be in addition to any collateral security, if any, described
in any
separate agreement executed by each Borrower.
13.13 Sale
or Assignment
(a) Each
Bank
may assign to an Eligible Assignee all or a portion of its rights and
obligations under this Agreement (including, without limitation, all or a
portion of its Commitments or Loans, as the case may be, and the Note (if
any)
held by it); provided,
however,
that:
(i) each such assignment shall be of a constant, and not a varying, percentage
of all of the assigning Bank’s rights and obligations under this Agreement; (ii)
the amount so assigned shall equal or exceed $5,000,000.00; (iii) the parties
to
each such assignment shall execute and deliver to the Agent, for its acceptance
and recording in the Register (as hereinafter defined), an Assignment and
Acceptance in the form of Exhibit
C
attached
hereto and made a part hereof (the “Assignment
and Acceptance”);
and
(iv) any such assignment shall not require the consent of any Borrower. Upon
such execution, delivery, acceptance, and recording, from and after the
effective date specified in each Assignment and Acceptance, which effective
date
shall be the date on which such Assignment and Acceptance is accepted by
the
Agent, (A) the Eligible Assignee thereunder shall be a party hereto and,
to the
extent that rights and obligations hereunder have been assigned to it pursuant
to such Assignment and Acceptance, have the rights and obligations of a Bank
under the Loan Documents, and (B) the Bank assignor thereunder shall, to
the
extent that rights and obligations hereunder have been assigned by it pursuant
to such Assignment and Acceptance, relinquish its rights and be released
from
its obligations under the Loan Documents (and, in the case of an Assignment
and
Acceptance covering all or the remaining portion of an assigning Bank’s rights
and obligations under the Loan Documents, such Bank shall cease to be a party
thereto).
(b) By
executing and delivering an Assignment and Acceptance, the Bank assignor
thereunder and the Eligible Assignee thereunder confirm to and agree with
each
other and the other parties hereto as follows: (i) other than as provided
in
such Assignment and Acceptance, 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 any Loan Document
or the execution, legality, validity, enforceability, genuineness, sufficiency,
or value of any Loan Document or any other instrument or document furnished
pursuant thereto; (ii) such assigning Bank makes no representation or warranty
and assumes no responsibility with respect to the financial condition of
each
Borrower or any of its Subsidiaries or the performance or observance by each
Loan Party of any of its obligations under any Loan Document or any other
instrument or document furnished pursuant thereto; (iii) such Eligible Assignee
confirms that it has received a copy of the Loan Documents, together with
copies
of the financial statements referred to in Section 7.2 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; (iv) such Eligible
Assignee, independently and without reliance upon the Agent, such assigning
Bank, or any Bank and based on such documents and information as it shall
deem
appropriate at the time, will continue to make its own credit decisions in
taking or not taking action under this Agreement; (v) such Eligible Assignee
appoints and authorizes the Agent to take such action as agent on its behalf
and
to exercise such powers under any Loan Document as are delegated to the Agent
by
the terms thereof, together with such powers as are reasonably incidental
thereto; and (vi) such Eligible Assignee agrees that it will perform in
accordance with their terms all of the obligations which by the terms of
any
Loan Document are required to be performed by it as a Bank.
(c) The
Agent
shall maintain at its address referred to in Section 13.4 a copy of each
Assignment and Acceptance delivered to and accepted by it and a register
for the
recordation of the names and addresses of Banks and the Commitment of, and
principal amount of the Loans owing to, each Bank from time to time (the
“Register”).
The
entries in the Register shall be conclusive and binding for all purposes,
absent
manifest error, and the Borrowers, the Agent, and Banks may treat each Person
whose name is recorded in the Register as Bank hereunder for all purposes
of the
Loan Documents. The Register shall be available for inspection by the Borrowers
or any Bank at any reasonable time and from time to time upon reasonable
prior
notice.
(d) Upon
its
receipt of an Assignment and Acceptance executed by an assigning Bank, together
with any Note subject to such assignment, the Agent, if such Assignment and
Acceptance has been completed and is in substantially the form of Exhibit
C,
shall
(i) accept such Assignment and Acceptance; (ii) record the information contained
therein in the Register; and (iii) give prompt notice thereof to the Borrowers.
Within three (3) Business Days after its receipt of such notice, the Borrowers
at their own expense, shall execute and deliver to the Agent in exchange
for
each surrendered Note a new Note to the order of such Eligible Assignee in
an
amount equal to the Commitment or Loans (as the case may be) assumed by it
pursuant to such Assignment and Acceptance and, if the assigning Bank has
retained a Commitment or Loans (as the case may be) hereunder, a new Note
to the
order of the assigning Bank in an amount equal to the Commitment or Loans
(as
the case may be) retained by it hereunder. The new Notes shall be in an
aggregate principal amount equal to the aggregate principal amount of the
surrendered Notes, shall be dated the effective date of such Assignment and
Acceptance and shall otherwise be in substantially the form of Exhibit C
attached
hereto and made a part hereof. Upon receipt by the Agent of each such new
Note
conforming to the requirements set forth in the preceding sentences, the
Agent
shall return to the Borrowers each such surrendered Note marked to show that
each such surrendered Note has been replaced, renewed, and extended by such
new
Note.
(e) Each
Bank
may sell participations to one or more banks or other entities in or to all
or a
portion of its rights and/or obligations under this Agreement (including,
without limitation, all or a portion of its Commitment or Loans (as the case
may
be) and the Note (if any) held by it); provided,
however,
that
(i) each Bank’s obligations under this Agreement (including, without limitation,
its Commitment to the Borrowers hereunder) shall remain unchanged; (ii) such
Bank shall remain solely responsible to the other parties hereto for the
performance of such obligations; (iii) except as provided below, such Bank
shall
remain the holder of any such Loans and any such Note for all purposes of
this
Agreement; and (iv) the participating banks or other entities shall be entitled
to the benefits of Sections 2.3 and 4.5 to recover costs, losses and expenses
in
the circumstances, and to the extent provided in Section 2.3, as though such
participant were a Bank; provided,
however,
the
amounts to which a participant shall be entitled to obtain pursuant to Sections
2.3 and 4.5 shall be determined by reference to such participant’s selling Bank
and shall be recoverable solely from such selling Bank and (v) the Borrowers,
the Agent and the other Banks shall continue to deal solely and directly
with
the selling Bank in connection with such Bank’s rights and obligations under
this Agreement and the other Loan Documents; provided,
however,
the
selling Bank may grant a participant rights with respect to amendments,
modification or waivers with respect to any fees payable hereunder to such
Bank
(including the amount and the dates fixed for the payment of any such fees)
or
the amount of principal or the rate of interest payable on, the dates fixed
for
any payment of principal or interest on, the Loans, or the release of any
obligations of the Borrowers hereunder and under the other Loan Documents,
or
the release of any security for any of the Obligations. Except with respect
to
cost protections contained in Sections 2.3 and 4.6, no participant shall
be a
third party beneficiary of this Agreement and shall not be entitled to enforce
any rights provided to its selling Bank against the Company under this Agreement
or any other Loan Documents.
(f) Notwithstanding
anything herein to the contrary, each Bank may pledge and assign all or any
portion of its rights and interests under the Loan Documents to any Federal
Reserve Bank.
(g) “Bank
Affiliate”
shall
mean (a) with respect to any Bank, (i) an Affiliate of such Bank or (ii)
any
entity (whether a corporation, partnership, trust or otherwise) that is engaged
in making, purchasing, holding or otherwise investing in bank loans and similar
extensions of credit in the ordinary course of its business and is administered
or managed by a Bank or an Affiliate of such Bank and (b) with respect to
any
Bank that is a fund which invests in bank loans and similar extensions of
credit, any other fund that invests in bank loans and similar extensions
of
credit and is managed by the same investment advisor as such Bank or by an
Affiliate of such investment advisor.
13.14 Non
U.S. Banks
Prior
to
the date of the initial Borrowings hereunder, and from time to time thereafter
if requested by the Borrowers or the Agent, each Bank organized under the
laws
of a jurisdiction outside the United States of America shall provide the
Agent
and the Borrowers with the forms prescribed by the Internal Revenue Service
of
the United States of America certifying such Banks exemption from United
States
withholding taxes with respect to all payments to be made to such Bank hereunder
or under such Bank’s Note. Unless the Borrowers and the Agent have received
forms or other documents satisfactory to them indicating that payments hereunder
or under such Bank’s Note are not subject to United States withholding tax or
are subject to such tax at a rate reduced by an applicable tax treaty, the
Borrowers or the Agent shall withhold taxes from such payments at the applicable
statutory rate in the case of payments to or for any Bank organized under
the
laws of a jurisdiction outside the United States.
13.15 Interest
All
agreements between the Borrowers, the Agent or any Bank, whether now existing
or
hereafter arising and whether written or oral, are hereby expressly limited
so
that in no contingency or event whatsoever, whether by reason of demand being
made on any Note, Loan, other Obligation or otherwise, shall the amount paid,
or
agreed to be paid, to the Agent or any Bank for the use, forbearance, or
detention of the money to be loaned under this Agreement or otherwise or
for the
payment or performance of any covenant or obligation contained herein or
in any
document related hereto exceed the amount permissible at the Highest Lawful
Rate. If, as a result of any circumstances whatsoever, fulfillment of any
provision hereof or of any of such documents, at the time performance of
such
provision shall be due, shall involve transcending the limit of validity
prescribed by applicable usury law, then, ipso
facto,
the
obligation to be filled shall be reduced to the limit of such validity, and
if,
from any such circumstance, the Agent or any Bank shall ever receive interest
or
anything which might be deemed interest under applicable law which would
exceed
the amount permissible at the Highest Lawful Rate, such amount which would
be
excessive interest shall be applied to the reduction of the principal amount
owing on account of the Loans or the amounts owing on other obligations of
the
Borrowers to the Agent or any Bank under this Agreement, the other Loan
Documents or any document related hereto and not to the payment of interest,
or
if such excessive interest exceeds the unpaid principal balance of the Loans
and
the amounts owing on other obligations of the Borrowers to the Agent or any
Bank
under this Agreement or any document related hereto, as the case may be,
such
excess shall be refunded to the Borrowers. All sums paid or agreed to be
paid to
the Agent or any Bank for the use, forbearance, or detention of the indebtedness
of the Borrowers to the Agent or any Bank shall, to the extent permitted
by
applicable law, be amortized, prorated, allocated, and spread throughout
the
full term of such indebtedness until payment in full of the principal thereof
(including the period of any renewal or extension thereof) so that the interest
on account of such indebtedness shall not exceed the Highest Lawful Rate.
The
terms and provisions of this Section 13.15 shall control and supersede every
other provision of all agreements between the Borrowers and the
Banks.
13.16 Indemnification
EACH
BORROWER JOINTLY AND SEVERALLY AGREES TO INDEMNIFY, DEFEND, AND SAVE HARMLESS
THE AGENT, EACH BANK AND THEIR RESPECTIVE OFFICERS, DIRECTORS, EMPLOYEES,
AGENTS, AND ATTORNEYS, AND EACH OF THEM (THE “INDEMNIFIED PARTIES”), FROM AND
AGAINST ALL CLAIMS, ACTIONS, SUITS, AND OTHER LEGAL PROCEEDINGS, DAMAGES,
COSTS,
INTEREST, CHARGES, TAXES, COUNSEL FEES, AND OTHER EXPENSES AND PENALTIES
(INCLUDING WITHOUT LIMITATION ALL ATTORNEY FEES AND COSTS OR EXPENSES OF
SETTLEMENT) WHICH ANY OF THE INDEMNIFIED PARTIES MAY SUSTAIN OR INCUR BY
REASON
OF OR ARISING OUT OF (a) THE MAKING OF ANY LOAN HEREUNDER, THE EXECUTION
AND
DELIVERY OF THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS AND THE CONSUMMATION
OF
THE TRANSACTIONS CONTEMPLATED HEREBY AND THEREBY AND THE EXERCISE OF ANY
OF THE
AGENT’S AND THE BANKS’ RIGHTS UNDER THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS
OR OTHERWISE, INCLUDING, WITHOUT LIMITATION, DAMAGES, COSTS, AND EXPENSES
INCURRED BY ANY OF THE INDEMNIFIED PARTIES IN INVESTIGATING, PREPARING FOR,
DEFENDING AGAINST, OR PROVIDING EVIDENCE, PRODUCING DOCUMENTS, OR TAKING
ANY
OTHER ACTION IN RESPECT OF ANY COMMENCED OR THREATENED LITIGATION UNDER ANY
FEDERAL SECURITIES LAW OR ANY SIMILAR LAW OF ANY JURISDICTION OR AT COMMON
LAW
OR (b) ANY AND ALL CLAIMS OR PROCEEDINGS (WHETHER BROUGHT BY A PRIVATE PARTY,
GOVERNMENTAL AUTHORITY OR OTHERWISE) FOR BODILY INJURY, PROPERTY DAMAGE,
ABATEMENT, REMEDIATION, ENVIRONMENTAL DAMAGE, OR IMPAIRMENT OR ANY OTHER
INJURY
OR DAMAGE RESULTING FROM OR RELATING TO THE RELEASE OF ANY HAZARDOUS MATERIALS
LOCATED UPON, MIGRATING INTO, FROM, OR THROUGH OR OTHERWISE RELATING TO ANY
PROPERTY OWNED OR LEASED BY ANY BORROWER OR ANY OF ITS SUBSIDIARIES (WHETHER
OR
NOT THE RELEASE OF SUCH HAZARDOUS MATERIALS WAS CAUSED BY ANY BORROWER, ANY
SUBSIDIARY OF ANY BORROWER, A TENANT, OR SUBTENANT OF ANY BORROWER OR ANY
OF ITS
SUBSIDIARIES, A PRIOR OWNER, A TENANT, OR SUBTENANT OF ANY PRIOR OWNER OR
ANY
OTHER PARTY AND WHETHER OR NOT THE ALLEGED LIABILITY IS ATTRIBUTABLE TO THE
HANDLING, STORAGE, GENERATION, TRANSPORTATION, OR DISPOSAL OF ANY HAZARDOUS
MATERIALS OR THE MERE PRESENCE OF ANY HAZARDOUS MATERIALS ON SUCH PROPERTY;
PROVIDED
THAT NO BORROWER SHALL BE LIABLE TO THE INDEMNIFIED PARTIES WHERE THE RELEASE
OF
SUCH HAZARDOUS MATERIALS OCCURS AT ANY TIME AT WHICH ANY BORROWER OR ANY
OF ITS
SUBSIDIARIES CEASES TO OWN OR LEASE SUCH PROPERTY); AND PROVIDED FURTHER
THAT NO
INDEMNIFIED PARTY SHALL BE ENTITLED TO THE BENEFITS OF THIS SECTION 13.16
TO THE
EXTENT ITS OWN GROSS NEGLIGENCE OR WILLFUL MISCONDUCT CONTRIBUTED TO ITS
LOSS;
AND PROVIDED FURTHER THAT IT IS THE INTENTION OF EACH BORROWER TO INDEMNIFY
THE
INDEMNIFIED PARTIES AGAINST THE CONSEQUENCES OF THEIR OWN NEGLIGENCE. THIS
AGREEMENT IS INTENDED TO PROTECT AND INDEMNIFY THE INDEMNIFIED PARTIES AGAINST
ALL RISKS HEREBY ASSUMED BY EACH BORROWER. FOR PURPOSES OF THE FOREGOING
SECTION
13.16, THE PHRASE “CONSUMMATION OF THE TRANSACTIONS CONTEMPLATED HEREBY AND
THEREBY” SET FORTH IN SUBPARAGRAPH (a) ABOVE SHALL INCLUDE, BUT NOT BE LIMITED
TO, THE FINANCING OF ANY CORPORATE TAKEOVER PERMITTED HEREUNDER AND THE
BORROWERS’ USE OF THE LOAN PROCEEDS FOR THE PURPOSE OF FINANCING THE XXX
XXXXXXXXXX ACQUISITION. THE OBLIGATIONS OF THE BORROWERS UNDER THIS SECTION
13.16 SHALL SURVIVE ANY TERMINATION OF THIS AGREEMENT AND THE REPAYMENT IN
FULL
OF THE OBLIGATIONS.
13.17 Payments
Set Aside
To
the
extent that the Borrowers make a payment or payments to the Agent or any
Bank or
the Agent or any Bank exercises its right of set off, and such payment or
payments or the proceeds of such set off or any part thereof are subsequently
invalidated, declared to be fraudulent or preferential, set aside and/or
required to be repaid to a trustee, receiver or any other Person under any
Debtor Law or equitable cause, then, to the extent of such recovery, the
obligation or part thereof originally intended to be satisfied, and all rights
and remedies therefor, shall be revived and shall continue in full force
and
effect as if such payment had not been made or set off had not
occurred.
13.18 Bridge
Loan
Agreement Controls
If
there
are any conflicts or inconsistencies among this Agreement and any other document
executed in connection with the transactions connected herewith, the provisions
of this Agreement shall prevail and control.
13.19 Obligations
Several
The
obligations of each Bank under this Agreement and the Note to which it is
a
party are several, and no Bank shall be responsible for any obligation or
Commitment of any other Bank under this Agreement and the Note to which it
is a
party. Nothing contained in this Agreement or the other Loan Documents to
which
it is a party, and no action taken by any Bank pursuant thereto, shall be
deemed
to constitute the Banks to be a partnership, an association, a joint venture,
or
any other kind of entity.
13.20 Pro
Rata Treatment
All
Loans
under, and all payments and other amounts received in connection with this
Agreement and the other Loan Documents (including, without limitation, amounts
received as a result of the exercise by any Bank of any right of set off)
shall
be effectively shared by the Banks ratably in accordance with the respective
Pro
Rata Percentages of the Banks. If any Bank shall obtain any payment (whether
voluntary, involuntary, through the exercise of any right of set off, or
otherwise) on account of the principal of, or interest on, or fees in respect
of, any Loan held by it (other than pursuant to Section 2.3(d)) in excess
of its
Pro Rata Percentage of payments on account of similar Loans obtained by all
the
Banks, such Bank shall forthwith purchase from the other Banks such
participations in the Loans made by them as shall be necessary to cause such
purchasing Bank to share the excess payment ratably with each of them;
provided,
however,
that if
all or any portion of such excess payment is thereafter recovered from such
purchasing Bank, such purchase from each Bank shall be rescinded and such
Bank
shall repay to the purchasing Bank the purchase price to the extent of such
recovery together with an amount equal to such Bank’s ratable share (according
to the proportion of (a) the amount of such Bank’s required repayment to (b) the
total amount so recovered from the purchasing Bank) of any interest or other
amount paid or payable by the purchasing Bank in respect of the total amount
so
recovered. Disproportionate payments of interest shall be shared by the purchase
of separate participations in unpaid interest obligations, disproportionate
payments of fees shall be shared by the purchase of separate participations
in
unpaid fee obligations, and disproportionate payments of principal shall
be
shared by the purchase of separate participations in unpaid principal
obligations. The Borrowers agree that any Bank so purchasing a participation
from another Bank pursuant to this Section 13.20 may, to the fullest extent
permitted by law, exercise all its rights of payment (including the right
of
set-off) with respect to such participation as fully as if such Bank were
the
direct creditor of the applicable Borrower in the amount of such participation.
Notwithstanding the foregoing, a Bank may receive and retain an amount in
excess
of its Pro Rata Percentage to the extent but only to the extent, that such
excess results from such Bank’s Highest Lawful Rate exceeding another Bank’s
Highest Lawful Rate.
13.21 No
Rights, Duties or Obligations of Syndication Agent or
Documentation
Agent
The
Borrowers, the Agent and each Bank acknowledge and agree that except for
the
rights, powers, obligations and liabilities under this Agreement and the
other
Loan Documents as a Bank, JPMorgan Chase Bank, N.A. and Wachovia Bank, National
Association, as Co-Syndication Agent, and Calyon New York Branch and Bank
of
America, N.A., as Co-Documentation Agent, shall have no additional rights,
powers, obligations or liabilities under this agreement or any other Loan
Documents in their capacities as Syndication Agent or Documentation Agent,
respectively
13.22 Final
Agreement
THE
LOAN
DOCUMENTS REPRESENT THE FINAL AGREEMENT AMONG THE PARTIES HERETO AND MAY
NOT BE
CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS, OR SUBSEQUENT ORAL
AGREEMENT’S OF THE PARTIES HERETO. THERE ARE NO UNWRITTEN ORAL AGREEMENTS
BETWEEN THE PARTIES HERETO.
13.23 WAIVER
OF JURY TRIAL
EACH
PARTY HERETO HEREBY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE
LAW,
ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN ANY LEGAL PROCEEDING DIRECTLY
OR
INDIRECTLY ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE TRANSACTIONS
CONTEMPLATED HEREBY (WHETHER BASED ON CONTRACT, TORT OR ANY OTHER THEORY).
EACH
PARTY HERETO (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY
OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY
WOULD
NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND
(B) ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO
ENTER INTO THIS AGREEMENT BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND
CERTIFICATIONS IN THIS SECTION.
13.24 USA
Patriot Act
Each
Bank
hereby notifies the Borrowers that pursuant to the requirements of the USA
Patriot Act (Title III of Pub. L. 107-56 (signed into law October 26, 2001))
(the “Act”), it is required to obtain, verify and record information that
identifies the Borrowers and the other Loan Parties, which information includes
the names and addresses of the Borrowers and the other Loan Parties and other
information that will allow such Bank to identify the Borrowers and the other
Loan Parties, in accordance with the Act.
13.25 Successors
and Assigns Generally.
The
provisions of this Agreement shall be binding upon and inure to the benefit
of
the parties hereto and their respective successors and assigns permitted
hereby,
except that neither Borrower may assign or otherwise transfer any of its
rights
or obligations hereunder without the prior written consent of the Agent and
each
Bank and no Bank may assign or otherwise transfer any of its rights or
obligations hereunder except as provided in Section 13.13.
[Signature
pages follow]
IN
WITNESS WHEREOF, the parties hereto, by their respective officers thereunto
duly
authorized, have executed this Agreement on the dates set forth below to
be
effective as of the date and year first above written.
SOUTHERN
UNION COMPANY
By: _/S/
XXXXX X. EDWARDS____
Name:
Xxxxx X. Xxxxxxx
Title:
Senior Vice President & CFO
ENHANCED
SERVICE SYSTEMS, INC.
By: _/S/
XXXXX X. EDWARDS______
Name:
Xxxxx X. Xxxxxxx
Title:
Senior Vice President & CFO
XXXXXX
COMMERCIAL PAPER INC.,
as
Administrative Agent
By: /S
XXXXXX X. XXXXXX
Name:
Xxxxxx X. Xxxxxx
Title:
Senior Vice President
Payment
Office:
Xxxxxx
Commercial Paper Inc.
c/x
Xxxxxx Brothers Commercial Bank
c/x
Xxxxxx Brothers
000
0xx
Xxxxxx, 0xx Xxxxx
Xxx
Xxxx,
XX 00000
Attn:
Deal Administrator
Loan
Servicing Department
Phone:
(000) 000-0000
Fax:
(000) 000-0000
[BANKS]
[
],
as
a Bank
By:
Name:
Title:
Address
for Notices:
Domestic
Lending Office:
Eurodollar
Lending Office:
SCHEDULE
2.1(a)
COMMITMENTS
|
Bank
|
Commitment
|
|
Xxxxxx
Commercial Paper Inc.
|
$550,000,000.00
|
|
Xxxxxxx
Xxxxx Bank USA
|
$550,000,000.00
|
|
JPMorgan
Chase Bank, N.A.
|
$
80,000,000.00
|
|
Wachovia
Bank, National Association
|
$
80,000,000.00
|
|
Bank
of America, N.A.
|
$
80,000,000.00
|
|
Calyon
New York Branch
|
$
80,000,000.00
|
|
KBC
Bank, N.V.
|
$
70,000,000.00
|
|
The
Bank of Tokyo-Mitsubishi UFJ, Ltd., Houston Agency
|
$
25,000,000.00
|
|
Union
Bank of California, N.A.
|
$
25,000,000.00
|
|
Sovereign
Bank
|
$
20,000,000.00
|
|
SunTrust
Bank
|
$
20,000,000.00
|
|
LaSalle
Bank National Association
|
$
20,000,000.00
|
|
Total:
|
$1,600,000,000.00
|
EXHIBIT
A
PROMISSORY
NOTE
$___________ ___________,
200__
FOR
VALUE
RECEIVED, each of undersigned, SOUTHERN UNION COMPANY, a Delaware corporation
(the “Parent”) and ENHANCED SERVICE SYSTEMS, INC., a Delaware corporation
(“ESSI”
and
together with the Parent, the “Borrowers”
and
each, a “Borrower”),
JOINTLY AND SEVERALLY HEREBY PROMISES TO PAY to the order of
___________________________________ (the “Bank”),
on or
before the Maturity Date (as defined in the Bridge Loan Agreement referred
to
below), the principal sum of ________________ Million Dollars and No Cents
($[_______]) in accordance with the terms and provisions of that certain
Bridge
Loan Agreement, dated as of March 1, 2006, (as amended, modified, amended
and
restated or otherwise supplemented from time to time in accordance with the
terms thereof, the “Bridge
Loan Agreement”),
by
and among the Borrowers, the Bank, the other Banks party thereto, and Xxxxxx
Commercial Paper Inc., as Administrative Agent (in such capacity, the
“Agent”).
Capitalized terms used herein and not otherwise defined shall have the meanings
ascribed to such terms in the Bridge Loan Agreement.
The
outstanding principal balance of this Promissory Note shall be payable at
the
Maturity Date. Each Borrower jointly and severally promises to pay interest
on
the unpaid principal balance of this Promissory Note from the date of any
Loan
evidenced by this Promissory Note until the principal balance thereof is
paid in
full. Interest shall accrue on the outstanding principal balance of this
Promissory Note from and including the date of any Loan evidenced by this
Promissory Note to but not including the Maturity Date at the rate or rates,
and
shall be due and payable on the dates, set forth in the Bridge Loan Agreement.
Any amount not paid when due with respect to principal (whether at stated
maturity, by acceleration or otherwise), costs or expenses, or, to the extent
permitted by applicable law, interest, shall bear interest from the date
when
due to and excluding the date the same is paid in full, payable on demand,
at
the rate provided for in Section 2.2(b) of the Bridge Loan
Agreement.
Payments
of principal and interest, and all amounts due with respect to costs and
expenses, shall be made in lawful money of the United States of America in
immediately available funds, without deduction, set off or counterclaim to
the
account of the Agent at the Agent’s Payment Office not later than 12:00 noon
(New York City time) on the dates on which such payments shall become due
pursuant to the terms and provisions set forth in the Bridge Loan
Agreement.
If
any
payment of interest or principal herein provided for is not paid when due,
then
the owner or holder of this Promissory Note may at its option, by notice
to the
Borrowers, declare the unpaid, principal balance of this Promissory Note,
all
accrued and unpaid interest thereon and all other amounts payable under this
Promissory Note to be forthwith due and payable, whereupon this Promissory
Note,
all such interest and all such amounts shall become and be forthwith due
and
payable in full, without presentment, demand, protest, notice of intent to
accelerate, notice of actual acceleration or further notice of any kind,
all of
which are hereby expressly waived by the Borrowers.
If
any
payment of principal or interest on this Promissory Note shall become due
on a
Saturday, Sunday, or public holiday on which the Agent is not open for business,
such payment shall be made on the next succeeding Business Day and such
extension of time shall in such case be included in computing interest in
connection with such payment.
In
addition to all principal and accrued interest on this Promissory Note, each
Borrower jointly and severally agrees to pay (a) all reasonable costs and
expenses incurred by the Agent and all owners and holders of this Promissory
Note in collecting this Promissory Note through any probate, reorganization
bankruptcy or any other proceeding and (b) reasonable attorneys’ fees when and
if this Promissory Note is placed in the hands of an attorney for collection
after default.
All
agreements between the Borrowers and the Bank, whether now existing or hereafter
arising and whether written or oral, are hereby expressly limited so that
in no
contingency or event whatsoever, whether by reason of demand being made on
this
Promissory Note or otherwise, shall the amount paid, or agreed to be paid,
to
the Bank for the use, forbearance, or detention of the money to be loaned
under
the Bridge Loan Agreement and evidenced by this Promissory Note or otherwise
or
for the payment or performance of any covenant or obligation contained in
the
Bridge Loan Agreement or this Promissory Note exceed the amount permissible
at
Highest Lawful Rate. If as a result of any circumstances whatsoever, fulfillment
of any provision hereof or of the Bridge Loan Agreement at the time performance
of such provision shall be due, shall involve transcending the limit of validity
prescribed by applicable usury law, then, ipso facto, the obligation to be
fulfilled shall be reduced to the limit of such validity, and if from any
such
circumstance, the Bank shall ever receive interest or anything which might
be
deemed interest under applicable law which would exceed the amount permissible
at the Highest Lawful Rate, such amount which would be excessive interest
shall
be applied to the reduction of the principal amount owing on account of this
Promissory Note or the amounts owing on other obligations of the Borrowers
to
the Bank under the Bridge Loan Agreement and not to the payment of interest,
or
if such excessive interest exceeds the unpaid principal balance of this
Promissory Note and the amounts owing on other obligations of the Borrowers
to
the Bank under the Bridge Loan Agreement, as the case may be, such excess
shall
be refunded to the Borrowers. In determining whether or not the interest
paid or
payable under any specific contingencies exceeds the Highest Lawful Rate,
the
Borrowers and the Bank shall, to the maximum extent permitted under applicable
law, (a) characterize any nonprincipal payment as an expense, fee or premium
rather than as interest; (b) exclude voluntary prepayments and the effects
thereof, and (c) amortize, prorate, allocate and spread in equal parts during
the period of the full stated term of this Promissory Note, all interest
at any
time contracted for, charged, received or reserved in connection with the
indebtedness evidenced by this Promissory Note.
This
Promissory Note is one of the Notes provided for in, and is entitled to the
benefits of, the Bridge Loan Agreement, which Bridge Loan Agreement, among
other
things, contains provisions for acceleration of the maturity hereof upon
the
happening of certain stated events, for prepayments on account of principal
hereof prior to the maturity hereof upon the terms and conditions and with
the
effect therein specified, and provisions to the effect that no provision
of the
Bridge Loan Agreement or this Promissory Note shall require the payment or
permit the collection of interest in excess of the Highest Lawful Rate. It
is
contemplated that by reason of prepayments or repayments hereon prior to
the
Maturity Date, there may be times when no indebtedness is owing hereunder
prior
to such date; but notwithstanding such occurrence this Revolving Note shall
remain valid and shall be in full force and effect as to Loans made pursuant
to
the Bridge Loan Agreement subsequent to each such occurrence.
Except
as
otherwise specifically provided for in the Bridger Loan Agreement, the Borrowers
and any and all endorsers, guarantors and sureties severally waive grace,
demand, presentment for payment, notice of dishonor or default, protest,
notice
of protest, notice of intent to accelerate, notice of acceleration and diligence
in collecting and bringing of suit against any party hereto, and agree to
all
renewals, extensions or partial payments hereon and to any release or
substitution of security hereof, in whole or in part, with or without notice,
before or after maturity.
THIS
PROMISSORY NOTE SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE
LAWS
OF THE STATE OF NEW YORK.
A-
IN
WITNESS WHEREOF, each Borrower has caused this Promissory Note to be executed
and delivered by its officer thereunto duly authorized effective as of the
date
first above written.
SOUTHERN
UNION COMPANY
By:
Name:
Title:
ENHANCED
SERVICE SYSTEMS, INC.
By:
Name:
Title:
A-
EXHIBIT
B
NOTICE
OF BORROWING
Xxxxxx
Commercial Paper Inc.,
as
Administrative Agent
c/x
Xxxxxx Brothers
000
0xx
Xxxxxx, 0xx Xxxxx
Xxx
Xxxx,
XX 00000
Attn:
Xxxxxxxx Xxxxxxxxxx
Re: Bridge
Loan Agreement referred to below
Ladies
and Gentlemen:
The
undersigned hereby certifies that s/he is an officer of SOUTHERN UNION COMPANY,
a Delaware corporation (the “Parent”)
and of
ENHANCED SERVICE SYSTEMS, INC., a Delaware corporation (“ESSI”
and
together with the Parent, the “Borrowers”
and
each, a “Borrower”),
authorized to execute this Notice of Borrowing on behalf of the Borrowers.
With
reference to that Bridge Loan Agreement, dated as of March 1, 2006 (as the
same
may be amended, modified, increased, supplemented and/or restated from time
to
time, the “Bridge
Loan Agreement”)
entered into by and among the Borrowers, the Banks party thereto and Xxxxxx
Commercial Paper, Inc., as Administrative Agent (in such capacity, the
“Agent”),
the
undersigned further certifies, represents and warrants to the Banks on behalf
of
the Borrowers that to his best knowledge and belief after reasonable and
due
investigation and review, all of the following statements are true and correct
(each capitalized term used herein having the same meaning given to it in
the
Bridge Loan Agreement unless otherwise specified):
I. [Borrowing][Conversion/Continuation]
[In
the case of the Borrowing under Section 2.1(a):
(a) [The
Borrowers hereby request that the Banks advance to the Borrowers the aggregate
sum of $__________by no later than ____________, 200__ (the “Borrowing
Date”).
Immediately following such Loan, the aggregate outstanding balance of Loans
shall equal $__________.]
(b) The
Borrowers hereby request that the Loans bear interest as follows:
(i) The
principal amount of the Loans, if any, which shall bear interest at the
Alternate Base Rate requested to be made by the Banks is $________.
(ii) The
principal amount of the Loans, if any, which shall bear interest at the
Eurodollar Rate for which the Rate Period shall be one month requested to
be
made by the Banks is $__________.
(iii) The
principal amount of the Loans, if any, which shall bear interest at the
Eurodollar Rate for which the Rate Period shall be two months requested to
be
made by the Banks is $_________.
(iv) The
principal amount of the Loans, if any, which shall bear interest at the
Eurodollar Rate for which the Rate Period shall be three months requested
to be
made by the Banks is $_________.
(v) The
principal amount of the Loans, if any, which shall bear interest at the
Eurodollar Rate for which the Rate Period shall be six months requested to
be
made by the Banks is $__________.
(c) The
proceeds of the Borrowing Loans made by the Banks pursuant to the Section
2.1(a)
shall be deposited into the account described as follows: [insert
Name of Account]
[In
the case of conversions or continuations of Loans:
[The
Borrowers hereby requests that on [__________]
(i) $[__________]
of the presently outstanding principal amount of the Loans originally made
on
[__________],
(ii) and
all
presently being maintained as [Alternate Base Rate Loans] [Eurodollar Rate
Loans],
(iii) be
[converted into] [continued as]
(iv) [Eurodollar
Rate Loans having a Rate Period of [one/two/three/six] months] [Alternate
Base
Rate Loans].
II. Miscellaneous.
(a) As
of the
date hereof, and as a result of the [making] [continuation] [conversion]
of the
requested Loans, there does not and will not exist any Default or Event of
Default.
(b) The
representations and warranties contained in Section 7 of the Bridge Loan
Agreement are true and correct in all material respects as of the date hereof
and shall be true and correct upon the [making] [continuation] [conversion]
of
the requested Loan, with the same force and effect as though made on and
as of
the date hereof and thereof.
EXECUTED
AND DELIVERED this _____ day of _______________, 200__.
SOUTHERN
UNION COMPANY
By: _________________________
Name:
Title:
B-
EXHIBIT
C
ASSIGNMENT
AND ACCEPTANCE
[NAME
AND
ADDRESS OF
ASSIGNING
BANK]
_______________,
200__
________________
________________
________________
________________
|
Re:
|
Southern
Union Company Bridge Loan Agreement
|
Ladies
and Gentlemen:
Reference
is made to that certain Bridge Loan Agreement, dated as of March 1, 2006,
(as
amended, supplemented, amended and restated or otherwise modified from time
to
time, the “Bridge
Loan Agreement”),
by
and among Southern Union Company (the “Company”),
the
Banks party thereto (including us), and Xxxxxx Commercial Paper Inc., as
Administrative Agent (in such capacity, the “Agent”).
Capitalized terms used herein and not otherwise defined shall have the meanings
ascribed to such terms in the Bridge Loan Agreement.
Each
reference to the Bridge Loan Agreement, the Notes, the other Loan Documents
or
any other document evidencing or governing the Loans (all such documents
collectively, the “Financing
Documents”)
includes each such document as amended, modified, extended or replaced from
time
to time. All times are New York City times.
1. Assignment.
We hereby sell you and assign to you without recourse, and you hereby
unconditionally and irrevocably acquire for your own account and risk, a
percent
( %) undivided interest (“your assigned share”) in each of the
following (the “Assigned
Obligations”):
a. our
Note
(if any); and
b. all
Loans
held by us and interest thereon as provided in Section 2 of the Bridge Loan
Agreement [,except that interest shall accrue on your assigned share in the
principal of Alternate Base Rate Loans and Eurodollar Rate Loans at an annual
rate equal to the rate provided in the Bridge Loan Agreement minus
_____%].
2. Materials
Provided Assignee
a. We
will
promptly request that the Company issue new Notes to us and to you in
substitution for our Note to reflect the assignment set forth herein. Upon
issuance of such substitute Notes, (i) you will become a Bank under the Bridge
Loan Agreement, (ii) you will assume our obligations under the Bridge Loan
Agreement to the extent of your assigned share, and (iii) the Company will
release us from our obligations under the Bridge Loan Agreement to the extent,
but only to the extent, of your assigned share. The Company consents to such
release by signing this Agreement where indicated below. As a Bank, you will
be
entitled to the benefits and subject to the obligations of a “Bank”, as set
forth in the Bridge Loan Agreement, and your rights and liabilities with
respect
to the other Banks and the Agent will be governed by the Bridge Loan Agreement,
including without limitation, Section 12 of the Bridge Loan
Agreement.
b. We
have
furnished you copies of the Bridge Loan Agreement, our Note and each other
Financing Document you have requested. We do not represent or warrant (i)
the
priority, legality, validity, binding effect or enforceability of any Financing
Document or any security interest created thereunder, (ii) the truthfulness
and
accuracy of any representation contained in any Financing Document, (iii)
the
filing or recording of any Financing Document necessary to perfect any security
interest created thereunder, (iv) the financial condition of the Company
or any
other Person obligated under any Financing Document, any financial or other
information, certificate, receipt or other document furnished or to be furnished
under any Financing Document or (v) any other matter not specifically set
forth
herein having any relation to any Financing Document, the Loans, your interest
in one Note, the Company or any other Person. You represent to us that you
are
able to make, and have made, your own independent investigation and
determination of the foregoing matters, including, without limitation, the
credit worthiness of the Company and the structure of the
transaction.
3. Governing
law; Jurisdiction.
This
Agreement shall be governed by, and construed in accordance with, the laws
of
the State of New York. You irrevocably submit to the jurisdiction of any
State
or Federal court sitting in the Borough of Manhattan in New York City in
any
suit, action or proceeding arising out of or relating to this Agreement and
irrevocably waive any objection you may have to this laying of venue of any
such
suit, action or proceeding brought in any such court and any claim that any
such
suit, action or proceeding has been brought in an inconvenient forum. We
may
serve process in any manner permitted by law and may bring proceedings against
you in any other jurisdiction.
4. Notices.
All
notices and other communications given hereunder to a party shall be given
in
writing (including bank wire, telecopy, telex or similar writing) at such
party’s address set forth on the signature pages hereof or such other address as
such party may hereafter specify by notice to the other party. Notice may
also
be given by telephone to the Person, or any other officer in the office,
listed
on the signature pages hereof if confirmed promptly by telex or telecopy.
Notices shall be effective immediately, if given by telephone; upon
transmission, if given by bank wire, telecopy or telex; five days after deposit
in the mails, if mailed; and when delivered, if given by other
means.
5. Authority.
Each of
us represents and warrants that the execution and delivery of this Agreement
have been validly authorized by all necessary corporate action and that this
Agreement constitutes a valid and legally binding obligation enforceable
against
it in accordance with its terms.
6. Counterparts.
This
Agreement may be executed in one or more counterparts, and by each party
on
separate counterparts, each of which shall be an original but all of which
taken
together shall be but one instrument.
7. Amendments.
No
amendment modification or waiver of any provision of this Agreement shall
be
effective unless in writing and signed by the party against whom enforcement
is
sought.
If
the
foregoing correctly sets forth our agreement, please so indicate by signing
the
enclosed copy of this Agreement and returning it to us.
Very
truly yours,
By:
Name:
Title:
[Street
Address]
[City,
State, Zip Code]
Telephone:
Telecopy:
AGREED
AND ACCEPTED:
_______________________________
By: _________________________
_________________________
_________________________
_________________________
Attention: ___________________
Telephone: ___________________
Telecopy: ___________________
Account
for Payments: ____________
C-
RELEASE
APPROVED IN SECTION 2 OF THIS AGREEMENT:
SOUTHERN
UNION COMPANY
By: _/s/
XXXXX X. EDWARDS____
Name: Xxxxx
X.
Xxxxxxx
Title: Senior
Vice President and
Chief
Financial Officer
ASSIGNMENT
ACKNOWLEDGED
XXXXXX
COMMERCIAL PAPER INC.,
as
Administrative Agent
By: _/s/
XXXXXX X. PERPER___
Name: Xxxxxx
X.
Xxxxxx
Title: Senior
Vice President
EXHIBIT
D-1
FORM
OF PARENT PLEDGE AGREEMENT
PARENT
PLEDGE AGREEMENT
dated
as of
March
1 , 2006
among
SOUTHERN
UNION COMPANY,
as
the Pledgor
and
XXXXXX
COMMERCIAL PAPER INC.,
as
Administrative Agent
TABLE
OF CONTENTS
_________________
Page
|
Section
1.
|
Definitions
|
1
|
|
Section
2.
|
Grant
Of Transaction Liens
|
4
|
|
Section
3.
|
General
Representations And Warranties
|
5
|
|
Section
4.
|
Further
Assurances; General Covenants
|
6
|
|
Section
5.
|
Investment
Property
|
8
|
|
Section
6.
|
Transfer
of Record Ownership
|
9
|
|
Section
7.
|
Right
to Vote Securities
|
9
|
|
Section
8.
|
Remedies
Upon Event of Default
|
10
|
|
Section
9.
|
Application
Of Proceeds
|
10
|
|
Section
10.
|
Fees
and Expenses; Indemnification
|
11
|
|
Section
11.
|
Authority
To Administer Collateral
|
11
|
|
Section
12.
|
Limitation
on Duty in Respect of Collateral
|
12
|
|
Section
13.
|
General
Provisions Concerning the Agent
|
12
|
|
Section
14.
|
Termination
Of Transaction Liens; Release Of Collateral
|
13
|
|
Section
15.
|
Notices
|
14
|
|
Section
16.
|
No
Implied Waivers; Remedies Not Exclusive
|
14
|
|
Section
17.
|
Successors
And Assigns
|
14
|
|
Section
18.
|
Amendments
And Waivers
|
15
|
|
Section
19.
|
Choice
Of Law
|
15
|
|
Section
20.
|
Waiver
Of Jury Trial
|
15
|
|
Section
21.
|
Severability
|
15
|
SCHEDULES
Schedule
1(a) Pledgor
Information
Schedule
1(b) Prior
Organizational Names
Schedule
1(c) Changes
in Corporate Identity; Other Names
Schedule
2
Part
A: Chief
Executive Office
Part
B: Location
of Books
Part
C: Other
Places of Businesses
Part
D: Prior
Locations Maintained by the Pledgor
Schedule
3 Equity
Interests Owned by the Pledgor
i
PLEDGE
AGREEMENT
This
PARENT PLEDGE AGREEMENT dated as of March 1, 2006 (as
amended, amended and restated, supplemented or otherwise modified from
time to
time in accordance with the provisions hereof, this “Agreement”),
by
and among
SOUTHERN UNION COMPANY, a Delaware corporation (the “Pledgor”),
as
pledgor,
in
favor of XXXXXX COMMERCIAL PAPER INC., as administrative agent (in such
capacity, the “Agent”)
on
behalf of the Secured Parties (as defined in the Bridge Loan Agreement
referred
to below), as pledgee.
WHEREAS,
the Pledgor, Enhanced System Services, Inc., a Delaware corporation
(“ESSI”
and
together with the Pledgor, the “Borrowers”
and
each, a “Borrower”),
the
Banks party thereto and the Agent are parties to the Bridge Loan Agreement
dated
as of March 1, 2006 (as the same may be amended, modified, increased,
supplemented and/or restated from time to time, the “Bridge
Loan Agreement”).
WHEREAS,
the Pledgor is willing to secure the Secured Obligations (defined below)
by
granting Liens on the Collateral (as defined below) as provided herein
and in
the other Collateral Documents.
WHEREAS,
it
is a
condition to the obligations of the Banks to make the Loans under the Bridge
Loan Agreement that the Pledgor execute and deliver this Agreement.
NOW,
THEREFORE, in consideration of the foregoing and other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged,
the
parties hereto agree as follows:
Section
1. Definitions
(a) Terms
Defined in Bridge Loan Agreement.
Terms
defined in the Bridge Loan Agreement and not otherwise defined in subsection
(b)
or (c) of this Section have, as used herein, the respective meanings provided
for therein.
(b) Terms
Defined in UCC.
As
used
herein, each of the following terms has the meaning specified in the
UCC:
|
Term
|
UCC
|
|
Instrument
|
9-102
|
|
Investment
Property
|
9-102
|
|
Proceeds
|
9-102
|
|
Securities
Intermediary
|
8-102
|
|
Security
|
8-102
and 8-103
|
|
Security
Entitlement
|
8-102
|
(c) Additional
Definitions.
The
following additional terms, as used herein, have the following
meanings:
“Agreement”
has
the
meaning set forth in the preamble hereto.
“Borrowers”
or
“Borrower”
has
the
meaning set forth in the recitals hereto.
“Bridge
Loan Agreement”
has
the
meaning set forth in the recitals hereto.
“Collateral”
means,
collectively, (i) the Pledged Securities, (ii) all Distributions with respect
to
such Pledged Securities, (iii) all Investment Property constituting,
representing or evidencing any of the foregoing in clauses (i) and (ii)
above,
and (iv) all Proceeds of the foregoing in clauses (i), (ii) and (iii)
above.
“Control”
has
the
meaning specified in UCC Section 8-106.
“Distributions”
means,
collectively, with respect to the Pledgor, all dividends, cash, options,
warrants, rights, instruments, distributions, returns of capital or principal,
income, interest, profits and other property, interests (debt or equity)
or
proceeds, including as a result of a split, revision, reclassification
or other
like change of the Pledged Securities, from time to time received, receivable
or
otherwise distributed to the Pledgor in respect of or in exchange for any
or all
of the Pledged Securities.
“Equity
Interest”
means
(i) in the case of a corporation, any shares of its capital stock, (ii)
in the
case of a limited liability company, any membership interest therein, (iii)
in
the case of a partnership, any partnership interest (whether general or
limited)
therein, (iv) in the case of any other business entity, any participation
or
other interest in the equity or profits thereof, (v) any warrant, option
or
other right to acquire any Equity Interest described in this definition
or (vi)
any Security Entitlement in respect of any Equity Interest described in
this
definition.
“Issuer
Control Agreement”
means
an Issuer Control Agreement in form and substance satisfactory to the
Agent.
“LLC
Interest”
means
a
membership interest or similar interest in a limited liability
company.
“Location”
means,
with respect to the Pledgor, the jurisdiction in which the Pledgor is located
for purposes of Section 9-301 of the UCC.
“Opinion
of Counsel”
means
a
written opinion of legal counsel (who may be counsel to a Pledgor or other
counsel, in either case approved by the Agent) addressed and delivered
to the
Agent.
“Organizational
Documents”
means,
with respect to any Person, (i) in the case of any corporation, the
certificate of incorporation and by-laws (or similar documents) of such
person,
(ii) in the case of any limited liability company, the certificate of
formation and operating agreement (or similar documents) of such Person,
(iii) in the case of any limited partnership, the certificate of formation
and limited partnership agreement (or similar documents) of such Person,
(iv) in the case of any general partnership, the partnership agreement (or
similar document) of such Person and (v) in any other case, the functional
equivalent of the foregoing.
“own”
refers
to the possession of sufficient rights in property to grant a security
interest
therein as contemplated by UCC Section 9-203, and “acquire”
refers
to the acquisition of any such rights.
“Partnership
Interest”
means
a
partnership interest, whether general or limited.
“Pledged
Securities”
means,
collectively, with respect to the Pledgor, (i) all issued and outstanding
Equity
Interests of the issuer set forth on Schedule
3
as being
owned by the Pledgor and all options, warrants, rights, agreements and
additional Equity Interests of whatever class of any such issuer acquired
by the
Pledgor (including by issuance), together with all rights, privileges,
authority
and powers of the Pledgor relating to such Equity Interests in such issuer
or
under any Organizational Document of such issuer, and the certificates,
instruments and agreements representing such Equity Interests and any and
all
interest of the Pledgor in the entries on the books of any financial
intermediary pertaining to such Equity Interests, and (ii) all Equity Interests
issued in respect of the Equity Interests referred to in clause (i) above
upon
any consolidation or merger of any issuer of such Equity Interests.
“Pledgor”
has
the
meaning set forth in the preamble hereto.
“Post-Petition
Interest”
means
any interest that accrues after the commencement of any case, proceeding
or
other action relating to the bankruptcy, insolvency or reorganization of
any one
or more of the Borrowers (or would accrue but for the operation of applicable
bankruptcy or insolvency laws), whether or not such interest is allowed
or
allowable as a claim in any such proceeding.
“Related
Parties”
means,
with respect to any specified Person, such Person’s Affiliates and the
respective directors, officers, employees, agents and advisors of such
Person
and its Affiliates.
“Secured
Obligations”
means
all Obligations, including, without limitation, all principal of all Loans
outstanding from time to time under the Bridge Loan Agreement, all interest
(including Post-Petition Interest) on the Loans and all other amounts now
or
hereafter payable by the Borrowers pursuant to the Loan Documents.
“Transaction
Liens”
means
the Liens granted by the Pledgor under the Collateral Documents.
“UCC”
means
the Uniform Commercial Code as in effect from time to time in the State
of New
York; provided
that, if
perfection or the effect of perfection or non-perfection or the priority
of any
Transaction Lien on any Collateral is governed by the Uniform Commercial
Code as
in effect in a jurisdiction other than New York, “UCC” means the Uniform
Commercial Code as in effect from time to time in such other jurisdiction
for
purposes of the provisions hereof relating to such perfection, effect of
perfection or non-perfection or priority.
(d) Terms
Generally.
The
definitions of terms herein (including those incorporated by reference
to the
UCC or to another document) apply equally to the singular and plural forms
of
the terms defined. Whenever the context may require, any pronoun includes
the
corresponding masculine, feminine and neuter forms. The words “include”,
“includes”
and
“including”
shall
be
deemed to be followed by the phrase “without
limitation”.
The
word “will”
shall
be construed to have the same meaning and effect as the word “shall”.
Unless
the context requires otherwise, (i) any definition of or reference to the
Bridge Loan Agreement or any other agreement, instrument or other document
herein shall be construed as referring to such agreement, instrument or
other
document as from time to time amended, supplemented or otherwise modified
(subject to any restrictions on such amendments, supplements or modifications
set forth herein), (ii) any reference herein to any Person shall be
construed to include such Person’s successors and assigns, (iii) the words
“herein”,
“hereof”
and
“hereunder”,
and
words of similar import, shall be construed to refer to this Agreement
in its
entirety and not to any particular provision hereof, (iv) all references
herein to Sections and Schedules shall be construed to refer to Sections
of, and
Schedules to, this Agreement and (v) the word “property”
shall
be construed to refer to any and all tangible and intangible assets and
properties, including cash, securities, accounts and contract
rights.
Section
2. Grant
Of Transaction Liens
.
(a) The
Pledgor, in order to secure the Secured Obligations, hereby pledges and
grants
to the Agent for the benefit of the Secured Parties a lien on and a security
interest in all of the right, title and interest of the Pledgor in, to
and under
the Collateral, whether now owned or existing or hereafter acquired or
arising
and wherever located.
(b) The
Transaction Liens are granted as security only and shall not subject the
Agent
or any other Secured Party to, or transfer or in any way affect or modify,
any
obligation or liability of the Pledgor with respect to any of the Collateral
or
any transaction in connection therewith.
(c) This
Agreement shall create a continuing security interest in and Lien on the
Collateral.
Section
3. General
Representations And Warranties
The
Pledgor represents and warrants that:
(a) (i)The
Pledgor is duly organized, validly existing and in good standing under
the laws
of the jurisdiction identified as its jurisdiction of organization in
Schedule
1(a).
Schedule
1(a)
accurately sets forth (x) the form of organization of the Pledgor and (y)
whether the Pledgor is a “registered organization” within the meaning of the UCC
and, if it is, its organizational identification number (if any).
(ii) Set
forth
in
Schedule
1(b)
is any
other corporate or organizational names of the Pledgor has had in the past
five
years, together with the date of the relevant change.
(iii) Set
forth
in Schedule
1(c)
is a
list of all other names (including trade names or similar appellations)
used by
the Pledgor, or any other business or organization to which the Pledgor
became
the successor by merger, consolidation, acquisition, change in form, nature
or
jurisdiction of organization or otherwise, at any time during the past
five
years. Also set forth in Schedule 1(c)
is the
information required by this Section 3(a) for any other business or
organization to which the Pledgor became the successor by merger, consolidation,
acquisition, change in form, nature or jurisdiction of organization
or
otherwise, at any time during the past five years. Except as set forth
in
Schedule
1(c),
the
Pledgor has not changed its jurisdiction of organization at any time during
the
past four months.
(b) The
chief
executive office of the Pledgor is located at the address set forth in
Part
A
of
Schedule
2.
Set
forth in Part
B
of
Schedule
2
are all
locations where the Pledgor maintains any books or records relating to
any of
the Collateral. Set forth in Part
C
of
Schedule
2
hereto
are all the other places of business of the Pledgor. Set forth in Part
D
of
Schedule
2
are the
locations or places of business previously maintained by the Pledgor at
any time
during the past five years.
(c) Schedule
3
lists
all Equity Interests in Panhandle Eastern owned by the Pledgor as of the
Closing
Date. The Pledgor holds all such Equity Interests directly and not through
a
Subsidiary, a Securities Intermediary or any other Person.
(d) The
Pledgor has good and marketable title to, owns and has rights in all its
Collateral (subject to exceptions that are, in the aggregate, not material),
free and clear of any and all Liens other than the Transaction
Liens.
(e) All
shares of capital stock or other interest included in such Pledged Securities
(including shares of capital stock in respect of which the Pledgor owns
a
Security Entitlement) have been duly authorized and validly issued and
are fully
paid and non-assessable. None of such Pledged Securities is subject to
any
option to purchase or similar right of any Person.
(f) The
Pledgor has not performed any acts that might prevent the Agent from enforcing
any of the provisions of the Collateral Documents or that would limit the
Agent
in any such enforcement. No financing statement, security agreement, mortgage
or
similar or equivalent document or instrument covering all or part of the
Collateral owned by the
Pledgor
is on file or of record in any jurisdiction in which such filing or recording
would be effective to perfect or record a Lien on such Collateral, except
financing statements, mortgages or other similar or equivalent documents
with
respect to the Transaction Liens. After the Closing Date, no Collateral
owned by
the
Pledgor
will be in the possession or under the Control of any other Person having
a
claim thereto or security interest therein, other than a Permitted
Lien.
(g) The
Transaction Liens on all Collateral owned by the Pledgor (i) have been
validly created, (ii) will attach to each item of such Collateral on the
Closing Date (or, if the Pledgor first obtains rights thereto on a later
date,
on such later date) and (iii) when so attached, will secure all the Secured
Obligations.
(h) Within
60
days after the Closing Date, the Pledgor will furnish to the Agent a file
search
report from the UCC filing office applicable to its Location, showing the
filing
made at such filing office to perfect the Transaction Liens on its
Collateral.
(i) When
UCC
financing statements have been filed in the offices specified in Schedule
4,
the
Transaction Liens will constitute perfected security interests in the Collateral
owned by the Pledgor to the extent that a security interest therein may
be
perfected by filing pursuant to the UCC, prior to all Liens and rights
of others
therein. Except for the filing of such UCC financing statements, no
registration, recordation or filing with any governmental body,
agency
or
official is required in connection with the execution or delivery of the
Collateral Documents or is necessary for the validity or enforceability
thereof
or for the perfection or due recordation of the Transaction Liens or for
the
enforcement of the Transaction Liens.
(j) As
of the
Closing Date, no Collateral is evidenced by an Instrument or a
certificate.
Section
4. Further
Assurances; General Covenants
The
Pledgor covenants as follows:
(a) The
Pledgor will, from time to time, at the Pledgor’s expense, execute, deliver,
file and record any statement, assignment, instrument, document, agreement
or
other paper and take any other action (including any filing of financing
or
continuation statements under the UCC) that from time to time may be necessary
or desirable, or that the Agent may request, in order to:
(i) create,
preserve, perfect, confirm or validate the Transaction Liens on the
Collateral;
(ii) in
the
case of Pledged Securities constituting Investment Property that is included
in
the Collateral, cause the Agent to have Control thereof;
(iii) enable
the Agent and the other Secured Parties to obtain the full benefits of
the
Collateral Documents; or
(iv) enable
the Agent to exercise and enforce any of its rights, powers and remedies
with
respect to any of the Collateral.
To
the
extent permitted by applicable law, the Pledgor authorizes the Agent to
execute
and file such financing statements or continuation statements without the
Pledgor’s signature appearing thereon. The Pledgor agrees that a carbon,
photographic, photostatic or other reproduction of this Agreement or of
a
financing statement is sufficient as a financing statement. The Pledgor
hereby
appoints the Agent its attorney-in-fact to execute and file all filings
required
or so requested for the foregoing purposes, all acts of such attorney being
hereby ratified and confirmed; and such power, being coupled with an interest,
shall be irrevocable until all the Transaction Liens granted by the Pledgor
terminate pursuant to Section 14. The Pledgor will pay the costs of, or
incidental to, any recording or filing of any financing or continuation
statements or other documents recorded or filed pursuant hereto.
(b) The
Pledgor will not (i) change its name or organizational structure,
(ii) change its Location or (iii) become bound, as provided in UCC
Section 9-203(d) or otherwise, by a security agreement entered into by
another
Person, unless it shall have given the Agent prior notice thereof and delivered
an Opinion of Counsel with respect thereto in accordance with
Section 4(c).
(c) At
least
30 days before it takes any action contemplated by Section 4(b), the
Pledgor will, at the its’ expense, cause to be delivered to the Agent an Opinion
of Counsel, in form and substance satisfactory to the Agent, as to such
matters
that the Agent may reasonably
request
relating to the perfection or priority of the Transaction Lien on any Collateral
to be owned by the Pledgor after it takes such action.
(d) The
Pledgor shall comply in all respects with the provisions of Section 10.19
of the
Bridge Loan Agreement.
(e) The
Pledgor will, promptly upon request, provide to the Agent all information
and
evidence concerning the Collateral that the Agent may reasonably request
from
time to time to enable it to enforce the provisions of the Collateral
Documents.
(f) From
time
to time upon request by the Agent, the Pledgor will, at its’ expense, cause to
be delivered to the Secured Parties an Opinion of Counsel satisfactory
to the
Agent as to such matters relating to the transactions contemplated hereby
as the
Agent may reasonably request.
(g) If
at any
time any Collateral shall be evidenced by an Instrument, the Pledgor owning
the
same shall cause the same promptly, and in any event within ten days, to
be
delivered to the Agent to be held in pledge hereunder, together with any
endorsements or instruments of transfer that the Agent may reasonably
request.
(h) The
Pledgor shall, at its own cost and expense, defend title to the Collateral
and
the security interest therein and Lien thereon granted to the Agent and
the
priority thereof against all claims and demands of all Persons, at their
own
cost and expense, at any time claiming any interest therein adverse to
the Agent
or any other Secured Party other than Transactional Liens. There is no
agreement, order, judgment or decree, and the Pledgor shall not enter into
any
agreement or take any other action, that would restrict the transferability
of
any of the Pledged Collateral or otherwise impair or conflict with the
Pledgor’s
obligations or the rights of the Agent hereunder.
Section
5. Investment
Property
The
Pledgor represents, warrants and covenants as follows:
(a) Certificated
Securities.
Not
later than the Closing Date, the Pledgor will deliver to the Agent as Collateral
hereunder all certificates or instruments representing or evidencing any
of the
Collateral then owned by the Pledgor. Thereafter, whenever the Pledgor
acquires
any other certificate representing or evidencing any Collateral, the Pledgor
will immediately deliver such certificate or instrument to the Agent as
Collateral hereunder.
(b) Uncertificated
Securities.
Not
later than the Closing Date, the Pledgor will enter into (and cause the
relevant
issuer to enter into) an Issuer Control Agreement in respect of each Pledged
Security then owned by the Pledgor that constitutes Collateral and is not
evidenced or represented by a certificate or instrument and deliver such
Issuer
Control Agreement to the Agent (which shall enter into the same). Thereafter,
whenever the Pledgor acquires any other Pledged Security that constitutes
Collateral and is not evidenced or represented by a certificate or instrument,
the Pledgor will enter into (and cause the relevant issuer to enter into)
an
Issuer Control Agreement in respect of such Pledged Security and deliver
such
Issuer Control Agreement to the Agent (which shall enter into the
same).
(c) Perfection
as to Certificated Securities.
When the
Pledgor delivers the certificate or instrument representing any Pledged
Security
owned by it and that constitutes Collateral to the Agent and complies with
Sections 5(a) and 5(e) in connection with such delivery, (i) the
Transaction Lien on such Pledged Security will be perfected, subject to
no prior
Liens or rights of others, (ii) the Agent will have Control of such Pledged
Security and (iii) the Agent will be a protected purchaser (within the
meaning of UCC Section 8-303) thereof.
(d) Perfection
as to Uncertificated Securities.
When
the Pledgor, the Agent and the issuer of any Pledged Security owned by
the
Pledgor and that constitutes Collateral and is not represented or evidenced
by a
certificate or instrument enter into an Issuer Control Agreement with respect
thereto, (i) the Transaction Lien on such Pledged Security will be
perfected, subject to no prior Liens or rights of others, (ii) the Agent
will have Control of such Pledged Security and (iii) the Agent will be a
protected purchaser (within the meaning of UCC Section 8-303)
thereof.
(e) Delivery
of Pledged Certificates.
All
certificates or instruments representing or evidencing any Pledged Security
that
constitutes Collateral, when delivered to the Agent, will be in suitable
form
for transfer by delivery, or accompanied by duly executed instruments of
transfer or assignment in blank, with signatures appropriately guaranteed,
all
in form and substance satisfactory to the Agent.
(f) Communications.
The
Pledgor will promptly give to the Agent copies of any notices and other
communications received by it with respect to any Collateral registered
in the
name of the Pledgor or its nominee.
Section
6. Transfer
of Record Ownership
At
any
time when an Event of Default shall have occurred and be continuing, the
Agent
may (and to the extent that action by it is required, the Pledgor, if directed
to do so by the Agent, will as promptly as practicable)
cause
each of the Pledged Securities (or any portion thereof specified in such
direction) to be transferred of record into the name of the Agent or its
nominee. The Pledgor will take any and all actions reasonably requested
by the
Agent to facilitate compliance with this Section. If
the
provisions of this Section are implemented, Section 5(c) shall not
thereafter apply to any Pledged Security that is registered in the name
of the
Agent or its nominee.
The
Agent will promptly give to the Pledgor copies of any notices and other
communications received by the Agent with respect to Pledged Securities
registered in the name of the Agent or its nominee.
Section
7. Right
to Vote Securities
(a) Unless
an
Event of Default shall have occurred and be continuing and the Agent shall
have
notified the Pledgor that the Pledgor’s rights under this Section are suspended,
the Pledgor will have the right, from time to time, to vote and to give
consents, ratifications and waivers with respect to any Pledged Security
owned
by it, and the Agent will, upon receiving a written request from the Pledgor,
deliver to the Pledgor or as specified in such request such proxies, powers
of
attorney, consents, ratifications and waivers in respect of any such Pledged
Security that is registered in the name of the Agent or its nominee as
shall be
specified in such request and be in form and substance satisfactory to
the
Agent. Unless an Event of Default shall have occurred and be continuing,
the
Agent will have no right to take any action which the owner of
any
Pledged Securities constituting Partnership Interest or LLC Interest that
is
part of the Collateral is entitled to take with respect thereto, except
the
right to receive payments and other distributions to the extent provided
herein.
(b) If
an
Event of Default shall have occurred and be continuing, the Agent will
have the
right to the extent permitted by law (and, in the case of Pledged Securities
constituting Partnership Interests or LLC Interests that are part of the
Collateral, by the relevant partnership agreement, limited liability company
agreement, operating agreement or other governing document) to vote, to
give
consents, ratifications and waivers and to take any other action with respect
to
any Investment Property or Pledged Securities that constitute Collateral,
with
the same force and effect as if the Agent were the absolute and sole owner
thereof, and the Pledgor will take all such action as the Agent may reasonably
request from time to time to give effect to such right.
Section
8. Remedies
Upon Event of Default
(a) If
an
Event of Default shall have occurred and be continuing, the Agent may exercise
(or cause its sub-agents to exercise) any or all of the remedies available
to it
(or to such sub-agents) under the Collateral Documents.
(b) Without
limiting the generality of the foregoing, if an Event of Default shall
have
occurred and be continuing, the Agent may exercise on behalf of the Secured
Parties all the rights of a secured party under the UCC (whether or not
in
effect in the jurisdiction where such rights are exercised) with respect
to any
Collateral and, in addition, the Agent may, without being required to give
any
notice, except as herein provided or as may be required by mandatory provisions
of law, withdraw all cash held by it as Collateral and apply such cash
as
provided in Section 9 and, if there shall be no such cash or if such cash
shall
be insufficient to pay all the Secured Obligations in full, sell, lease,
license
or otherwise dispose of the Collateral or any part thereof. Notice of any
such
sale or other disposition shall be given to the Pledgor as required by
Section 11.
Section
9. Application
Of Proceeds
(a) If
an
Event of Default shall have occurred and be continuing, the Agent may apply
(i) any cash then held by it as Collateral and (ii) the proceeds of
any sale or other disposition of all or any part of the Collateral, in
the
following order of priorities:
first,
to pay
the expenses of such sale or other disposition, including reasonable
compensation to agents of and counsel for the Agent, and all expenses,
liabilities and advances incurred or made by the Agent in connection with
the
Collateral Documents, and any other amounts then due and payable to the
Agent
pursuant to Section 11 or pursuant to Section 13.3 or 13.16 of the Bridge
Loan Agreement;
second,
to pay
the unpaid principal of the Secured Obligations ratably until payment in
full of
the principal of all Secured Obligations shall have been made;
third,
to pay
ratably all interest (including Post-Petition Interest) on the Secured
Obligations payable under the Bridge Loan Agreement and any Notes, until
payment
in full of all such interest and fees shall have been made;
fourth,
to pay
all other Secured Obligations ratably until payment in full of all such
other
Secured Obligations shall have been made; and
finally,
to pay
to the Pledgor, or as a court of competent jurisdiction may direct, any
surplus
then remaining from the proceeds of the Collateral owned by it.
(b) In
making
the payments and allocations required by this Section, the Agent may rely
upon
information supplied to it pursuant to Section 13(c). All distributions
made by the Agent pursuant to this Section shall be final (except in the
event
of manifest error) and the Agent shall have no duty to inquire as to the
application by any Secured Party of any amount distributed to it.
Section
10. Fees
and Expenses; Indemnification
(a) The
Pledgor will forthwith upon demand pay to the Agent:
(i) the
amount of any taxes that the Agent may have been required to pay by reason
of
the Transaction Liens or to free any Collateral from any other Lien
thereon;
(ii) the
amount of any and all reasonable out-of-pocket expenses, including transfer
taxes and reasonable fees and expenses of counsel and other experts, that
the
Agent may incur in connection with (x) the administration or enforcement
of the
Collateral Documents, including such expenses as are incurred to preserve
the
value of the Collateral or the validity, perfection, rank or value of any
Transaction Lien, (y) the collection, sale or other disposition of any
Collateral or (z) the exercise by the Agent of any of its rights or powers
under
the Collateral Documents;
(iii) the
amount of any fees that the Pledgor shall have agreed in writing to pay
to the
Agent and that shall have become due and payable in accordance with such
written
agreement; and
(iv) the
amount required to indemnify the Agent for, or hold it harmless and defend
it
against, any loss, liability or expense (including the reasonable fees
and
expenses of its counsel and any experts or sub-agents appointed by it hereunder)
incurred or suffered by the Agent in connection with the Collateral Documents,
except to the extent that such loss, liability or expense arises from the
Agent’s gross negligence or willful misconduct or a breach of any duty that the
Agent has under this Agreement (after giving effect to Sections 12 and
13).
Any
such
amount not paid to the Agent on demand will bear interest for each day
thereafter until paid at a rate per annum equal to the sum of 2% plus the
rate
applicable to Alternate Base Rate Loans for such day.
(b) If
any
transfer tax, documentary stamp tax or other tax is payable in connection
with
any transfer or other transaction provided for in the Collateral Documents,
the
Pledgor will pay such tax and provide any required tax stamps to the Agent
or as
otherwise required by law.
Section
11. Authority
To Administer Collateral
The
Pledgor irrevocably appoints the Agent its true and lawful attorney, with
full
power of substitution, in the name of the Pledgor, any Secured Party or
otherwise, for the sole use and benefit of the Secured Parties, but at
the
Pledgor’s expense, to the extent permitted by law to exercise, at any time and
from time to time while an Event of Default shall have occurred and be
continuing, all or any of the following powers with respect to all or any
of the
Pledgor’s Collateral (but the Agent shall not be obligated to and shall have no
liability to the Pledgor or any third party for failure to so do or take
action):
(a) to
demand, xxx for, collect, receive and give acquittance for any and all
monies
due or to become due upon or by virtue thereof;
(b) to
settle, compromise, compound, prosecute or defend any action or proceeding
with
respect thereto;
(c) to
sell,
lease, license or otherwise dispose of the same or the proceeds or avails
thereof, as fully and effectually as if the Agent were the absolute owner
thereof;
(d) to
extend
the time of payment of any or all thereof and to make any allowance or
other
adjustment with reference thereto; and
(e) to
take
any other action and to execute any instrument consistent with the terms
of the
Bridge Loan Agreement and the Collateral Documents which the Agent may
deem
necessary or advisable to accomplish the purposes hereof.
Section
12. Limitation
on Duty in Respect of Collateral
.
Beyond
the exercise of reasonable care in the custody and preservation thereof,
the
Agent will have no duty as to any Collateral in its possession or control
or in
the possession or control of any sub-agent or bailee or any income therefrom
or
as to the preservation of rights against prior parties or any other rights
pertaining thereto. The Agent will be deemed to have exercised reasonable
care
in the custody and preservation of the Collateral in its possession or
control
if such Collateral is accorded treatment substantially equal to that which
it
accords its own property, and will not be liable or responsible for any
loss or
damage to any Collateral, or for any diminution in the value thereof, by
reason
of any act or omission of any sub-agent or bailee selected by the Agent
in good
faith, except to the extent that such liability arises from the Agent’s gross
negligence or willful misconduct.
Section
13. General
Provisions Concerning the Agent
(a) The
provisions of Section 12 of the Bridge Loan Agreement shall inure to the
benefit
of the Agent, and shall be binding upon the Pledgor and all Secured Parties,
in
connection with this Agreement and the other Collateral Documents. Without
limiting the generality of the foregoing, (i) the Agent shall not be subject
to
any fiduciary or other implied duties, regardless of whether an Event of
Default
has occurred and is continuing, (ii) the Agent shall not have any duty to
take any discretionary action or exercise any discretionary powers, except
discretionary
rights
and powers expressly contemplated by the Collateral Documents that the
Agent is
required in writing to exercise by the Majority Banks (or such other number
or
percentage of the Banks as shall be necessary under the circumstances as
provided in Section 13.2 of the Bridge Loan Agreement), and (iii) except as
expressly set forth in the Loan Documents, the Agent shall not have any
duty to
disclose, and shall not be liable for any failure to disclose, any information
relating to any of the Borrowers or any of their respective Subsidiaries
or any
other Loan Party that is communicated to or obtained by the bank serving
as
Agent or any of its Affiliates in any capacity. The Agent shall not be
responsible for the existence, genuineness or value of any Collateral or
for the
validity, perfection, priority or enforceability of any Transaction Lien,
whether impaired by operation of law or by reason of any action or omission
to
act on its part under the Collateral Documents. The Agent shall be deemed
not to
have knowledge of any Event of Default unless and until written notice
thereof
is given to the Agent by the Pledgor or a Secured Party.
(b) Sub-Agents
and Related Parties.
The
Agent
may perform any of its duties and exercise any of its rights and powers
through
one or more sub-agents appointed by it. The Agent and any such sub-agent
may
perform any of its duties and exercise any of its rights and powers through
its
Related Parties. The exculpatory provisions of Section 12 and this Section
shall apply to any such sub-agent and to the Related Parties of the Agent
and
any such sub-agent.
(c) Information
as to Secured Obligations and Actions by Secured Parties. For
all
purposes of the Collateral Documents, including determining the amounts
of the
Secured Obligations, or whether any action has been taken under any Loan
Document, the Agent will be entitled to rely on information from (i) its
own records for information as to the Banks, any of the Secured Obligations
and
actions taken by them, (ii) any Secured Party (or any trustee, agent or
similar representative designated pursuant to (iii) to supply such
information) for information as to any of the Secured Obligations and actions
taken by it, to the extent that the Agent has not obtained such information
from
its own records, and (iv) the Pledgor or any of the Borrowers or any other
Loan Party, to the extent that the Agent has not obtained information from
the
foregoing sources.
(d) Refusal
to Act.
The
Agent may refuse to act on any notice, consent, direction or instruction
from
any Secured Parties or any agent, trustee or similar representative thereof
that, in the Agent’s opinion, (i) is contrary to law or the provisions of
any Collateral Document, (ii) may expose the Agent to liability (unless the
Agent shall have been indemnified, to its reasonable satisfaction, for
such
liability by the Secured Parties that gave such notice, consent, direction
or
instruction) or (iii) is unduly prejudicial to Secured Parties not joining
in such notice, consent, direction or instruction.
(e) Copies
of Certain Notices.
Within
two Business Days after it receives or sends any notice referred to in
this
subsection, the Agent shall send to the Banks copies of any notice given
by the
Agent to the Pledgor, or received by it from the Pledgor, pursuant to Section
8,
9, 11 or 14.
Section
14. Termination
Of Transaction Liens; Release Of Collateral
(a) The
Transaction Liens shall terminate when all Commitments under the Bridge
Loan
Agreement shall have expired or been terminated and all the Secured Obligations
shall have been paid in full in cash (other than contingent indemnification
obligations).
(b) At
any
time before the Transaction Liens terminate, the Agent may, at the written
request of the Borrowers, (i) release any Collateral with the prior written
consent of the Banks.
(c) Upon
any
termination of a Transaction Lien or release of Collateral, the Agent will,
at
the expense of the Pledgor, execute and deliver to the Pledgor such documents
as
the Pledgor shall reasonably request to evidence the termination of such
Transaction Lien or the release of such Collateral, as the case may
be.
Section
15. Notices
Each
notice, request or other communication given to any party hereunder shall
be
given in accordance with Section 13.4 of the Bridge Loan Agreement.
Section
16. No
Implied Waivers; Remedies Not Exclusive
No
failure by the Agent or any Secured Party to exercise, and no delay in
exercising and no course of dealing with respect to, any right or remedy
under
any Collateral Document shall operate as a waiver thereof; nor shall any
single
or partial exercise by the Agent or any Secured Party of any right or remedy
under any Loan Document preclude any other or further exercise thereof
or the
exercise of any other right or remedy. The rights and remedies specified
in the
Loan Documents are cumulative and are not exclusive of any other rights
or
remedies provided by law.
Section
17. Successors
And Assigns
.
This
Agreement is for the benefit of the Agent and the Secured Parties. If all
or any
part of any Secured Party’s interest in any Secured Obligation is assigned or
otherwise transferred in accordance with the provisions of the Bridge Loan
Agreement, the assignee’s or transferor’s rights hereunder, to the extent
applicable to the obligation so transferred, shall be automatically transferred
with such obligation. This Agreement shall be binding on the Pledgor and
their
respective successors and assigns;
provided,
however,
that no
Pledgor may assign any of its rights, interests or obligations herein without
the prior written consent of the Agent and all the Banks.
Section
18. Amendments
And Waivers
.
Neither
this Agreement nor any provision hereof may be waived, amended, modified
or
terminated except pursuant to an agreement or agreements in writing entered
into
by the Agent, with the consent of the Majority Banks, or, in the case of
any
such waiver, amendment or modification affecting the number of Banks required
to
release any of the Collateral, with the consent of all the Banks. No such
waiver, amendment or modification shall be binding upon the Pledgor, except
with
its written consent.
Section
19. Choice
Of Law
.
This
Agreement shall be construed in accordance with and governed by the laws
of the
State of New York, except as otherwise required by mandatory provisions
of law
and except to the extent that remedies provided by the laws of any jurisdiction
other than the State of New York are governed by the laws of such
jurisdiction.
Section
20. Waiver
Of Jury Trial
.
EACH
PARTY HERETO WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW,
ANY
RIGHT IT MAY HAVE TO A TRIAL BY JURY IN ANY LEGAL PROCEEDING DIRECTLY OR
INDIRECTLY ARISING OUT OF OR RELATING TO ANY COLLATERAL DOCUMENT OR ANY
TRANSACTION
CONTEMPLATED THEREBY (WHETHER BASED ON CONTRACT, TORT OR ANY OTHER THEORY).
EACH
PARTY HERETO (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF
ANY
OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY
WOULD
NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND
(B)
ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO
ENTER
INTO THIS AGREEMENT BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND
CERTIFICATIONS IN THIS SECTION.
Section
21. Severability
.
If any
provision of any Collateral Document is invalid or unenforceable in any
jurisdiction, then, to the fullest extent permitted by law, (i) the other
provisions of the Collateral Documents shall remain in full force and effect
in
such jurisdiction and shall be liberally construed in favor of the Agent
and the
Secured Parties in order to carry out the intentions of the parties thereto
as
nearly as may be possible and (ii) the invalidity or unenforceability of
such
provision in such jurisdiction shall not affect the validity or enforceability
thereof in any other jurisdiction.
[Signature
pages follow]
IN
WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly
executed by their respective authorized officers as of the day and year
first
above written.
SOUTHERN
UNION COMPANY, as the Pledgor
By: /S/
XXXXX X. XXXXXXX
Name:
Xxxxx X. Xxxxxxx
Title: Senior
Vice President and Chief Financial Officer
XXXXXX
COMMERCIAL PAPER INC.,
as
Administrative Agent
By: /S/
XXXXXX X. XXXXXX
Name:
Xxxxxx X. Xxxxxx
|
Title:
|
Senior
Vice President
|
[Signature
Page to Parent Pledge Agreement]
SCHEDULE
1(a)
PLEDGOR
INFORMATION
(as
of the Closing Date)
|
Name
of Pledgor
|
Type
of
Organization
|
Jurisdiction
of
Organization
|
Registered
Organization/
Organizational
I.D. Number
|
|
Southern
Union Company
|
Corporation
|
Delaware
|
0318923
|
SCHEDULE
1(b)
PRIOR
ORGANIZATIONAL NAMES
|
Pledgor
|
Prior
Name
|
Date
of Change
|
|
Southern
Union Company
|
NONE
|
N/A
|
SCHEDULE
1(c)
CHANGES
IN CORPORATE IDENTITY; OTHER NAMES
|
Pledgor
|
Corporate
Name of Entity
|
Action
|
Date
of Action
|
State
of Formation
|
List
of All Other Names Used During Past Five Years
|
|
Southern
Union Company
|
Southern
Union Company
|
Assumed
Name
|
03/29/2001
|
RI
|
Fall
River Gas, a division of Southern Union Company
|
|
Assumed
Name
|
10/11/2000
|
MA
|
Bristol
& Xxxxxx Gas
Company
|
||
|
Assumed
Name
|
06/05/2000
|
PA
|
Honesdale
Gas Company, a division of PG Energy
|
||
|
Assumed
Name
|
09/13/1993
|
MO
|
Missouri
Gas Energy
|
||
|
Assumed
Name
|
12/17/2001
|
RI
|
New
England Gas
|
||
|
Assumed
Name
|
02/22/2002
|
ME
|
New
England Gas Company
|
||
|
Assumed
Name
|
06/05/2000
|
PA
|
PG
Energy
|
||
|
Assumed
Name
|
09/28/2000
|
RI
|
ProvEnergy
|
||
|
Assumed
Name
|
09/28/2000
|
RI
|
ProvGas
|
||
|
Assumed
Name
|
01/14/1991
|
TX
|
Southern
Union Gas Company
|
||
|
Assumed
Name
|
08/05/2003
|
NY
|
Southern
Union Gas Company, Inc.
|
||
|
Assumed
Name
|
09/28/2000
|
RI
|
The
Providence Gas Company
|
||
|
Assumed
Name
|
03/29/2001
|
RI
|
Valley
Resources
|
[Add
Information required by Section 3(a) to the extent required by
Section 3(a)(iii)]
SCHEDULE
2
PART
A: CHIEF
EXECUTIVE OFFICES
|
Pledgor
|
Address
|
State
|
|
Southern
Union Company
|
0000
Xxxxxxxxxx Xxxx, Xxxxxxx
|
Xxxxx
|
PART
B: LOCATION
OF BOOKS
|
Pledgor
|
Address
|
State
|
|
Southern
Union Company
|
0000
Xxxxxxxxxx Xxxx, Xxxxxxx
|
Xxxxx
|
PART
C: OTHER
PLACES OF BUSINESS
|
Pledgor
|
Address
|
State
|
|
Southern
Union Company
|
One
PEI Center, Xxxxxx-Xxxxx
417
Lackawanna Ave., Scranton
0000
Xxxxxxxx, Xxxxxx Xxxx
000
Xxxxxxxxx Xxxxxx, Xxxxxxxxxx
000
Xxxxx Xxxxxx, 00xx
Xxxxx, Xxx Xxxx
|
Xxxxxxxxxxxx
Pennsylvania
Missouri
Rhode
Island
New
York
|
PART
D: PRIOR
LOCATIONS MAINTAINED BY THE PLEDGOR
|
Pledgor
|
Address
|
State
|
|
Southern
Union Company
|
000
Xxxxxx, Xxxxx 000, Xxxxxx
000
Xxxx 0xx Xxxxxx, Xxxxx 0000, Xxxxxx
|
Xxxxx
Texas
|
SCHEDULE
3
EQUITY
INTERESTS IN COLLATERAL OWNED BY THE
PLEDGOR
(as
of the Closing Date)
|
Issuer
|
Jurisdiction
of
Organization
|
Owner
of
Equity
Interest
|
Percentage
Owned
|
Number
of
Shares
or Units
|
|
Panhandle
Eastern Pipe Line Company, LP
|
Delaware
|
Southern
Union Company
|
100%
of the Limited
Partnership
Interests
|
N/A
|
SCHEDULE
4
FILING
OFFICE
Secretary
of State’s Office for the State of Delaware
EXHIBIT
D-2
FORM
OF SUG EAT ENTITIES PLEDGE AGREEMENT
PLEDGE
AGREEMENT
dated
as of
March
1 , 2006
among
SUG
EAT, INC.,
and
SUG
EAT, LLC.,
as
Pledgors,
and
XXXXXX
COMMERCIAL PAPER INC.,
as
Administrative Agent
TABLE
OF CONTENTS
_________________
Page
|
Section
1.
|
Definitions
|
1
|
|
Section
2.
|
Grant
Of Transaction Liens
|
4
|
|
Section
3.
|
General
Representations And Warranties
|
5
|
|
Section
4.
|
Further
Assurances; General Covenants
|
6
|
|
Section
5.
|
Investment
Property
|
8
|
|
Section
6.
|
Transfer
of Record Ownership
|
9
|
|
Section
7.
|
Right
to Vote Securities
|
9
|
|
Section
8.
|
Remedies
Upon Event of Default
|
10
|
|
Section
9.
|
Application
Of Proceeds
|
10
|
|
Section
10.
|
Fees
and Expenses; Indemnification
|
11
|
|
Section
11.
|
Authority
To Administer Collateral
|
11
|
|
Section
12.
|
Limitation
on Duty in Respect of Collateral
|
12
|
|
Section
13.
|
General
Provisions Concerning the Agent
|
12
|
|
Section
14.
|
Termination
Of Transaction Liens; Release Of Collateral
|
13
|
|
Section
15.
|
Notices
|
14
|
|
Section
16.
|
No
Implied Waivers; Remedies Not Exclusive
|
14
|
|
Section
17.
|
Successors
And Assigns
|
14
|
|
Section
18.
|
Amendments
And Waivers
|
15
|
|
Section
19.
|
Choice
Of Law
|
15
|
|
Section
20.
|
Waiver
Of Jury Trial
|
15
|
|
Section
21.
|
Severability
|
15
|
|
Section
22.
|
Matters
Pertaining to Pledgors.
|
15
|
SCHEDULES
Schedule
1(a) Pledgor
Information
Schedule
1(b) Prior
Organizational Names
Schedule
1(c) Changes
in Corporate Identity; Other Names
Schedule
2
Part
A: Chief
Executive Office
Part
B: Location
of Books
Part
C: Other
Places of Businesses
Part
D: Prior
Locations Maintained by Pledgors
Schedule
3 Equity
Interests Owned by each Pledgor
Schedule
4 Filing
Office
i
PLEDGE
AGREEMENT
This
PLEDGE AGREEMENT dated as of March 1, 2006 (as
amended, amended and restated, supplemented or otherwise modified from
time to
time in accordance with the provisions hereof, this “Agreement”),
by
and among
SUG
EAT, INC., a Delaware corporation (“SUG
EAT Inc.”)
and
SUG EAT, LLC, a Delaware limited liability company (“SUG
EAT LLC”),
as
pledgors (SUG EAT Inc. and
SUG
EAT LLC are collectively referred to as the
“Pledgors,”
and
each, a “Pledgor”)
in
favor of XXXXXX COMMERCIAL PAPER INC., as administrative agent (in such
capacity, the “Agent”)
on
behalf of the Secured Parties (as defined in the Bridge Loan Agreement
referred
to below), as pledgee.
WHEREAS,
Southern Union Company, a Delaware corporation (“Parent”),
Enhanced System Services, Inc., a Delaware corporation and a wholly owned
Subsidiary of the Parent (“ESSI”
and
together with the Parent, the “Borrowers”),
the
Banks party thereto and the Agent are parties to the Bridge Loan Agreement
dated
as of March 1, 2006 (as the same may be amended, modified, increased,
supplemented and/or restated from time to time, the “Bridge
Loan Agreement”).
WHEREAS,
in order to effect the Xxx Xxxxxxxxxx Acquisition (defined in the Bridge
Loan
Agreement), ESSI shall make a loan in the aggregate principal amount of
$1.6
billion to the SUG EAT Entities (the “SUG
EAT Entities Loan”)
on the
Closing Date (defined in the Bridge Loan Agreement) pursuant to the SUG
EAT
Entities Loan Documents (defined in the Bridge Loan Agreement). The proceeds
of
the SUG EAT Entities Loan shall be used by the SUG EAT Entities to fund
the
purchase price of the Xxx Xxxxxxxxxx Acquisition. As security for the SUG
EAT
Entities Loan, the SUG EAT Entities shall, on the Closing Date, grant to
ESSI a
second priority security interest in 100% of all issued and outstanding
limited
partner interests in SRES and REM and 100% of all issued and outstanding
general
partner interests in SRES, REM and Leapartners.
WHEREAS,
each of Pledgors will receive substantial benefits from the Loans made
to the
Borrowers and each, therefore, is willing to secure the Secured Obligations
(as
defined below) by granting Liens on its respective Collateral (as defined
below)
as provided herein and in the other Collateral Documents.
WHEREAS,
it
is a
condition to the obligations of the Banks to make the Loans under the Bridge
Loan Agreement that each Pledgor execute and deliver this
Agreement.
NOW,
THEREFORE, in consideration of the foregoing and other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged,
the
parties hereto agree as follows:
Section
1. Definitions
.
(a) Terms
Defined in Bridge Loan Agreement.
Terms
defined in the Bridge Loan Agreement and not otherwise defined in subsection
(b)
or (c) of this Section have, as used herein, the respective meanings provided
for therein.
(b) Terms
Defined in UCC.
As
used
herein, each of the following terms has the meaning specified in the
UCC:
|
Term
|
UCC
|
|
Instrument
|
9-102
|
|
Investment
Property
|
9-102
|
|
Proceeds
|
9-102
|
|
Securities
Intermediary
|
8-102
|
|
Security
|
8-102
and 8-103
|
|
Security
Entitlement
|
8-102
|
(c) Additional
Definitions.
The
following additional terms, as used herein, have the following
meanings:
“Agreement”
has
the
meaning set forth in the preamble hereto.
“Borrowers”
or
“Borrower”
has
the
meaning set forth in the recitals hereto.
“Bridge
Loan Agreement”
has
the
meaning set forth in the recitals hereto.
“Collateral”
means,
collectively, (i) the Pledged Securities, (ii) all Distributions with respect
to
such Pledged Securities, (iii) all Investment Property constituting,
representing or evidencing any of the foregoing in clauses (i) and (ii)
above,
and (iv) all Proceeds of the foregoing in clauses (i), (ii) and (iii)
above.
“Control”
has
the
meaning specified in UCC Section 8-106.
“Distributions”
means,
collectively, with respect to each Pledgor, all dividends, cash, options,
warrants, rights, instruments, distributions, returns of capital or principal,
income, interest, profits and other property, interests (debt or equity)
or
proceeds, including as a result of a split, revision, reclassification
or other
like change of the Pledged Securities, from time to time received, receivable
or
otherwise distributed to such Pledgor in respect of or in exchange for
any or
all of the Pledged Securities.
“Equity
Interest”
means
(i) in the case of a corporation, any shares of its capital stock, (ii)
in the
case of a limited liability company, any membership interest therein, (iii)
in
the case of a partnership, any partnership interest (whether general or
limited)
therein, (iv) in the case of any other business entity, any participation
or
other interest in the equity or profits thereof, (v) any warrant, option
or
other right to acquire any Equity Interest described in this definition
or (vi)
any Security Entitlement in respect of any Equity Interest described in
this
definition.
“Issuer
Control Agreement”
means
an Issuer Control Agreement in form and substance satisfactory to the
Agent.
“Location”
means,
with respect to any Pledgor, the jurisdiction in which such Pledgor is
located
for purposes of Section 9-301 of the UCC.
“LLC
Interest”
means
a
membership interest or similar interest in a limited liability
company.
“Opinion
of Counsel”
means
a
written opinion of legal counsel (who may be counsel to a Pledgor or other
counsel, in either case approved by the Agent) addressed and delivered
to the
Agent.
“Organizational
Documents”
means,
with respect to any Person, (i) in the case of any corporation, the
certificate of incorporation and by-laws (or similar documents) of such
person,
(ii) in the case of any limited liability company, the certificate of
formation and operating agreement (or similar documents) of such Person,
(iii) in the case of any limited partnership, the certificate of formation
and limited partnership agreement (or similar documents) of such Person,
(iv) in the case of any general partnership, the partnership agreement (or
similar document) of such Person and (v) in any other case, the functional
equivalent of the foregoing.
“own”
refers
to the possession of sufficient rights in property to grant a security
interest
therein as contemplated by UCC Section 9-203, and “acquire”
refers
to the acquisition of any such rights.
“Parent”
has
the
meaning set forth in the recitals hereto.
“Partnership
Interest”
means
a
partnership interest, whether general or limited.
“Pledged
Securities”
means,
collectively, with respect to each Pledgor, (i) all issued and outstanding
Equity Interests of each issuer set forth on Schedule
3
as being
owned or otherwise acquired by such Pledgor and all options, warrants,
rights,
agreements and additional Equity Interests of whatever class of any such
issuer
acquired by such Pledgor (including by issuance), together with all rights,
privileges, authority and powers of such Pledgor relating to such Equity
Interests in each such issuer or under any Organizational Document of such
issuer, and the certificates, instruments and agreements representing such
Equity Interests and any and all interest of such Pledgor in the entries
on the
books of any financial intermediary pertaining to such Equity Interests,
and
(ii) all Equity Interests issued in respect of the Equity Interests referred
to
in clause (i) above upon any consolidation or merger of any issuer of such
Equity Interests.
“Pledgors”
or
“Pledgor”
has
the
meaning set forth in the preamble hereto.
“Post-Petition
Interest”
means
any interest that accrues after the commencement of any case, proceeding
or
other action relating to the bankruptcy, insolvency or reorganization of
any one
or more of the Borrowers (or would accrue but for the operation of applicable
bankruptcy or insolvency laws), whether or not such interest is allowed
or
allowable as a claim in any such proceeding.
“Related
Parties”
means,
with respect to any specified Person, such Person’s Affiliates and the
respective directors, officers, employees, agents and advisors of such
Person
and its Affiliates.
“Secured
Obligations”
means
all Obligations, including, without limitation, all principal of all Loans
outstanding from time to time under the Bridge Loan Agreement, all interest
(including Post-Petition Interest) on such Loans and all other amounts
now or
hereafter payable by the Borrowers pursuant to the Loan Documents.
“SUG
EAT Inc.”
shall
have the meaning set forth in the preamble hereto.
“SUG
EAT LLC”
shall
have the meaning set forth in the preamble hereto.
“Transaction
Liens”
means
the Liens granted by the Pledgors under the Collateral Documents.
“UCC”
means
the Uniform Commercial Code as in effect from time to time in the State
of New
York; provided
that, if
perfection or the effect of perfection or non-perfection or the priority
of any
Transaction Lien on any Collateral is governed by the Uniform Commercial
Code as
in effect in a jurisdiction other than New York, “UCC” means the Uniform
Commercial Code as in effect from time to time in such other jurisdiction
for
purposes of the provisions hereof relating to such perfection, effect of
perfection or non-perfection or priority.
(d) Terms
Generally.
The
definitions of terms herein (including those incorporated by reference
to the
UCC or to another document) apply equally to the singular and plural forms
of
the terms defined. Whenever the context may require, any pronoun includes
the
corresponding masculine, feminine and neuter forms. The words “include”,
“includes”
and
“including”
shall
be deemed to be followed by the phrase “without
limitation”.
The
word “will”
shall
be construed to have the same meaning and effect as the word “shall”.
Unless
the context requires otherwise, (i) any definition of or reference to the
Bridge Loan Agreement or any other agreement, instrument or other document
herein shall be construed as referring to such agreement, instrument or
other
document as from time to time amended, supplemented or otherwise modified
(subject to any restrictions on such amendments, supplements or modifications
set forth herein), (ii) any reference herein to any Person shall be
construed to include such Person’s successors and assigns, (iii) the words
“herein”,
“hereof”
and
“hereunder”,
and
words of similar import, shall be construed to refer to this Agreement
in its
entirety and not to any particular provision hereof, (iv) all references
herein to Sections and Schedules shall be construed to refer to Sections
of, and
Schedules to, this Agreement and (v) the word “property”
shall
be construed to refer to any and all tangible and intangible assets and
properties, including cash, securities, accounts and contract
rights.
Section
2. Grant
Of Transaction Liens
.
(a) Each
Pledgor, in order to secure the Secured Obligations, hereby pledges and
grants
to the Agent for the benefit of the Secured Parties a lien on and a security
interest in all of the right, title and interest of such Pledgor in, to
and
under the Collateral, whether now owned or existing or hereafter acquired
or
arising and wherever located.
(b) The
Transaction Liens are granted as security only and shall not subject the
Agent
or any other Secured Party to, or transfer or in any way affect or modify,
any
obligation or liability of any Pledgor with respect to any of the Collateral
or
any transaction in connection therewith.
(c) This
Agreement shall create a continuing security interest in and Lien on the
Collateral.
Section
3. General
Representations And Warranties
.
Each
Pledgor represents and warrants that:
(a) (i)Each
Pledgor is duly organized, validly existing and in good standing under
the laws
of the jurisdiction identified as its jurisdiction of organization in
Schedule
1(a).
Schedule
1(a)
accurately sets forth (x) the form of organization of each Pledgor and
(y)
whether each Pledgor is a “registered organization” within the meaning of the
UCC and, if it is, its organizational identification number (if
any).
(ii) Set
forth
in
Schedule
1(b)
is any
other corporate or organizational names of each Pledgor has had in the
past five
years, together with the date of the relevant change.
(iii) Set
forth
in Schedule
1(c)
is a
list of all other names (including trade names or similar appellations)
used by
each Pledgor, or any other business or organization to which each
Pledgor
became the successor by merger, consolidation, acquisition, change in form,
nature or jurisdiction of organization or otherwise, at any time during
the past
five years. Also set forth in Schedule 1(c)
is the
information required by this Section 3(a) for any other business or
organization to which each Pledgor became the successor by merger,
consolidation, acquisition, change in form, nature or jurisdiction of
organization or otherwise, at any time during the past five years. Except
as set
forth in Schedule
1(c),
no
Pledgor has changed its jurisdiction of organization at any time during
the past
four months.
(b) The
chief
executive office of each Pledgor is located at the address set forth in
Part
A
of
Schedule
2.
Set
forth in Part
B
of
Schedule
2
are all
locations where each Pledgor maintains any books or records relating to
any of
the Collateral. Set forth in Part
C
of
Schedule
2
hereto
are all the other places of business of each Pledgor. Set forth in Part
D
of
Schedule
2
are the
locations or places of business previously maintained by each Pledgor at
any
time during the past five years.
(c) Schedule
3
lists
all Equity Interests in SRES, REM and Leapartners owned by the respective
Pledgor as of the Closing Date. Each Pledgor holds all such Equity Interests
directly and not through a subsidiary, a Securities Intermediary or any
other
Person.
(d) Each
Pledgor has good and marketable title to, owns and has rights in all its
Collateral (subject to exceptions that are, in the aggregate, not material),
free and clear of any and all Liens other than the Transaction Liens and,
at any
time prior to the consummation of the Acquired Business Equity Interests
Transfer, the Permitted Subordinated Liens.
(e) All
shares of capital stock or other interest included in such Pledged Securities
(including shares of capital stock in respect of which each Pledgor owns
a
Security Entitlement) have been duly authorized and validly issued and
are fully
paid and non-assessable. None of such Pledged Securities is subject to
any
option to purchase or similar right of any Person other than the Call Option
under the Qualified Exchange Accommodation Agreement.
(f) Each
Pledgor has not performed any acts that might prevent the Agent from enforcing
any of the provisions of the Collateral Documents or that would limit the
Agent
in any such enforcement. No financing statement, security agreement, mortgage
or
similar or equivalent document or instrument covering all or part of the
Collateral owned by each Pledgor is on file or of record in any jurisdiction
in
which such filing or recording would be effective to perfect or record
a Lien on
such Collateral, except financing statements, mortgages or other similar
or
equivalent documents with respect to the Transaction Liens. After the Closing
Date, no Collateral owned by each Pledgor will be in the possession or
under the
Control of any other Person having a claim thereto or security interest
therein,
other than a Permitted Lien.
(g) The
Transaction Liens on all Collateral owned by each Pledgor (i) have been
validly created, (ii) will attach to each item of such Collateral on the
Closing Date (or, if such Pledgor first obtains rights thereto on a later
date,
on such later date) and (iii) when so attached, will secure all the Secured
Obligations.
(h) Within
60
days after the Closing Date, each Pledgor will furnish to the Agent a file
search report from the UCC filing office applicable to its Location, showing
the
filing made at such filing office to perfect the Transaction Liens on its
Collateral.
(i) When
UCC
financing statements have been filed in the offices specified in Schedule
4,
the
Transaction Liens will constitute perfected security interests in the Collateral
owned by each Pledgor to the extent that a security interest therein may
be
perfected by filing pursuant to the UCC, prior to all Liens and rights
of others
therein. Except for the filing of such UCC financing statements, no
registration, recordation or filing with any governmental body, agency
or
official is required in connection with the execution or delivery of the
Collateral Documents or is necessary for the validity or enforceability
thereof
or for the perfection or due recordation of the Transaction Liens or for
the
enforcement of the Transaction Liens.
(j) As
of the
Closing Date, no Collateral is evidenced by an Instrument or a
certificate.
Section
4. Further
Assurances; General Covenants
.
Each
Pledgor covenants as follows:
(a) Such
Pledgor will, from time to time, at the Pledgors’ expense, execute, deliver,
file and record any statement, assignment, instrument, document, agreement
or
other paper and take any other action (including any filing of financing
or
continuation statements under the UCC) that from time to time may be necessary
or desirable, or that the Agent may request, in order to:
(i) create,
preserve, perfect, confirm or validate the Transaction Liens on such Pledgor’s
Collateral;
(ii) in
the
case of Pledged Securities constituting Investment Property that is included
in
the Collateral, cause the Agent to have Control thereof;
(iii) enable
the Agent and the other Secured Parties to obtain the full benefits of
the
Collateral Documents; or
(iv) enable
the Agent to exercise and enforce any of its rights, powers and remedies
with
respect to any of such Pledgor’s Collateral.
To
the
extent permitted by applicable law, such Pledgor authorizes the Agent to
execute
and file such financing statements or continuation statements without such
Pledgor’s signature appearing thereon. Such Pledgor agrees that a carbon,
photographic, photostatic or other reproduction of this Agreement or of
a
financing statement is sufficient as a financing statement. Such Pledgor
hereby
appoints the Agent its attorney-in-fact to execute and file all filings
required
or so requested for the foregoing purposes, all acts of such attorney being
hereby ratified and confirmed; and such power, being coupled with an interest,
shall be irrevocable until all the Transaction Liens granted by such Pledgor
terminate pursuant to Section 14. The Pledgors will pay the costs of, or
incidental to, any recording or filing of any financing or continuation
statements or other documents recorded or filed pursuant hereto.
(b) Such
Pledgor will not (i) change its name or organizational structure,
(ii) change its Location or (iii) become bound, as provided in UCC
Section 9-203(d) or otherwise, by a security agreement entered into by
another
Person, other than at any time prior to the consummation of the Acquired
Business Equity Interests Transfer, the applicable SUG EAT Entities Loan
Documents creating the Permitted Subordinated Liens t, unless, in each
case, it
shall have given the Agent prior notice thereof and delivered an Opinion
of
Counsel with respect thereto in accordance with Section 4(c).
(c) At
least
30 days before it takes any action contemplated by Section 4(b), such
Pledgor will, at the Pledgors’ expense, cause to be delivered to the Agent an
Opinion of Counsel, in form and substance satisfactory to the Agent, as
to such
matters that the Agent may reasonably request relating to the perfection
or
priority of the Transaction Lien on any Collateral to be owned by such
Pledgor
after it takes such action.
(d) The
Pledgors shall not, and shall cause each of its subsidiaries and each of
the
Partnership Companies to not:
(i) sell,
lease, exchange, assign, transfer, dispose of, contribute or dividend any
Collateral or any Equity Interests in any of the SUG EAT Entities or any
of the
Partnership Companies other than, in the case of the Collateral, in connection
with an Acquired Business Equity Interests Transfer;
(ii) merge
or
consolidate with and into any other Person; or
(iii) create,
incur, assume or otherwise suffer to exist any Lien on the Collateral or
any
part thereof or on any Equity Interests in any of the SUG EAT Entities
or any
Partnership Companies, except, in each case, for the Liens created by the
Collateral Documents and except, in the case of the Collateral only, at
any time
prior to the consummation of the Acquired Business Equity Interests Transfer,
for the Permitted Subordinated Lien; or
(iv) sell,
lease, exchange, assign, transfer, dispose of, contribute or dividend all
or
substantially all of the assets of any of the Partnership Companies to
any
Subsidiary of the Parent or any Affiliate of the Parent.
(e) Such
Pledgor will, promptly upon request, provide to the Agent all information
and
evidence concerning such Pledgor’s Collateral that the Agent may reasonably
request from time to time to enable it to enforce the provisions of the
Collateral Documents.
(f) From
time
to time upon request by the Agent, such Pledgor will, at the Pledgors’ expense,
cause to be delivered to the Secured Parties an Opinion of Counsel satisfactory
to the Agent as to such matters relating to the transactions contemplated
hereby
as the Agent may reasonably request.
(g) If
at any
time any Collateral shall be evidenced by an Instrument, the Pledgor owning
the
same shall cause the same promptly, and in any event within ten days, to
be
delivered to the Agent to be held in pledge hereunder, together with any
endorsements or instruments of transfer that the Agent may reasonably
request.
(h) The
Pledgors shall, at their own cost and expense, defend title to the Collateral
and the security interest therein and Lien thereon granted to the Agent
and the
priority thereof against all claims and demands of all Persons, at their
own
cost and expense, at any time claiming any interest therein adverse to
the Agent
or any other Secured Party other than Transactional Liens. There is no
agreement, order, judgment or decree, and no Pledgor shall enter into any
agreement or take any other action, that would restrict the transferability
of
any of the Pledged Collateral or otherwise impair or conflict with such
Pledgor’s obligations or the rights of the Agent hereunder.
Section
5. Investment
Property
.
Each
Pledgor represents, warrants and covenants as follows:
(a) Certificated
Securities.
Not
later than the Closing Date, such Pledgor will deliver to the Agent as
Collateral hereunder all certificates or instruments representing or evidencing
any of the Collateral then owned by such Pledgor. Thereafter, whenever
such
Pledgor acquires any other certificate representing or evidencing any
Collateral, such Pledgor will immediately deliver such certificate or instrument
to the Agent as Collateral hereunder.
(b) Uncertificated
Securities.
Not
later than the Closing Date, such Pledgor will enter into (and cause the
relevant issuer to enter into) an Issuer Control Agreement in respect of
each
Pledged Security then owned by such Pledgor that constitutes Collateral
and is
not evidenced or represented by a certificate or instrument and deliver
such
Issuer Control Agreement to the Agent (which shall enter into the same).
Thereafter, whenever such Pledgor acquires any other Pledged Security that
constitutes Collateral and is not evidenced or represented by a certificate
or
instrument, such Pledgor will enter into (and cause the relevant issuer
to enter
into) an Issuer Control Agreement in respect of such Pledged Security and
deliver such Issuer Control Agreement to the Agent (which shall enter into
the
same).
(c) Perfection
as to Certificated Securities.
When
such Pledgor delivers the certificate or instrument representing any Pledged
Security owned by it and that constitutes Collateral to the Agent and complies
with Sections 5(a) and 5(e) in connection with such delivery, (i) the
Transaction Lien on such Pledged Security will be perfected, subject to
no prior
Liens or rights of others, (ii) the Agent will have Control of such Pledged
Security and (iii) the Agent will be a protected purchaser (within the
meaning of UCC Section 8-303) thereof.
(d) Perfection
as to Uncertificated Securities.
When
such Pledgor, the Agent and the issuer of any Pledged Security owned by
such
Pledgor and that constitutes Collateral and is not represented or evidenced
by a
certificate or instrument enter into an Issuer Control Agreement with respect
thereto, (i) the Transaction Lien on such Pledged Security will be
perfected, subject to no prior Liens or rights of others, (ii) the Agent
will have Control of such Pledged Security and (iii) the Agent will be a
protected purchaser (within the meaning of UCC Section 8-303)
thereof.
(e) Delivery
of Pledged Certificates.
All
certificates or instruments representing or evidencing any Pledged Security
that
constitutes Collateral, when delivered to the Agent, will be in suitable
form
for transfer by delivery, or accompanied by duly executed instruments of
transfer or assignment in blank, with signatures appropriately guaranteed,
all
in form and substance satisfactory to the Agent.
(f) Communications.
Each
Pledgor will promptly give to the Agent copies of any notices and other
communications received by it with respect to any Collateral registered
in the
name of such Pledgor or its nominee.
Section
6. Transfer
of Record Ownership
.
At
any
time when an Event of Default shall have occurred and be continuing, the
Agent
may (and to the extent that action by it is required, the relevant Pledgor,
if
directed to do so by the Agent, will as promptly as practicable)
cause
each of the Pledged Securities (or any portion thereof specified in such
direction) to be transferred of record into the name of the Agent or its
nominee. Each Pledgor will take any and all actions reasonably requested
by the
Agent to facilitate compliance with this Section. If
the
provisions of this Section are implemented, Section 5(c) shall not
thereafter apply to any Pledged Security that is registered in the name
of the
Agent or its nominee.
The
Agent will promptly give to the relevant Pledgor copies of any notices
and other
communications received by the Agent with respect to Pledged Securities
registered in the name of the Agent or its nominee.
Section
7. Right
to Vote Securities
.
(a) Unless
an
Event of Default shall have occurred and be continuing and the Agent shall
have
notified the relevant Pledgor that such Pledgor’s rights under this Section are
suspended, each Pledgor will have the right, from time to time, to vote
and to
give consents, ratifications and waivers with respect to any Pledged Security
owned by it, and the Agent will, upon receiving a written request from
such
Pledgor, deliver to such Pledgor or as specified in such request such proxies,
powers of attorney, consents, ratifications and waivers in respect of any
such
Pledged Security that is registered in the name of the Agent or its nominee
as
shall be specified in such request and be in form and substance satisfactory
to
the Agent. Unless an Event of Default shall have occurred and be continuing,
the
Agent will have no right to take any action which the owner of any Pledged
Securities constituting Partnership Interest or LLC Interest that is part
of the
Collateral is entitled to take with respect thereto, except the right to
receive
payments and other distributions to the extent provided herein.
(b) If
an
Event of Default shall have occurred and be continuing, the Agent will
have the
right to the extent permitted by law (and, in the case of Pledged Securities
constituting Partnership Interests or LLC Interests that are part of the
Collateral, by the relevant partnership agreement, limited liability company
agreement, operating agreement or other governing docu
ment)
to
vote, to give consents, ratifications and waivers and to take any other
action
with respect to any Investment Property or Pledged Securities that constitute
Collateral, with the same force and effect as if the Agent were the absolute
and
sole owner thereof, and each Pledgor will take all such action as the Agent
may
reasonably request from time to time to give effect to such right.
Section
8. Remedies
Upon Event of Default
.
(a) If
an
Event of Default shall have occurred and be continuing, the Agent may exercise
(or cause its sub-agents to exercise) any or all of the remedies available
to it
(or to such sub-agents) under the Collateral Documents.
(b) Without
limiting the generality of the foregoing, if an Event of Default shall
have
occurred and be continuing, the Agent may exercise on behalf of the Secured
Parties all the rights of a secured party under the UCC (whether or not
in
effect in the jurisdiction where such rights are exercised) with respect
to any
Collateral and, in addition, the Agent may, without being required to give
any
notice, except as herein provided or as may be required by mandatory provisions
of law, withdraw all cash held by it as Collateral and apply such cash
as
provided in Section 9 and, if there shall be no such cash or if such cash
shall
be insufficient to pay all the Secured Obligations in full, sell, lease,
license
or otherwise dispose of the Collateral or any part thereof. Notice of any
such
sale or other disposition shall be given to the relevant Pledgor(s) as
required
by Section 11.
Section
9. Application
Of Proceeds
.
(a) If
an
Event of Default shall have occurred and be continuing, the Agent may apply
(i) any cash then held by it as Collateral and (ii) the proceeds of
any sale or other disposition of all or any part of the Collateral, in
the
following order of priorities:
first,
to pay
the expenses of such sale or other disposition, including reasonable
compensation to agents of and counsel for the Agent, and all expenses,
liabilities and advances incurred or made by the Agent in connection with
the
Collateral Documents, and any other amounts then due and payable to the
Agent
pursuant to Section 11 or pursuant to Section 13.3 or 13.16 of the Bridge
Loan Agreement;
second,
to pay
the unpaid principal of the Secured Obligations ratably until payment in
full of
the principal of all Secured Obligations shall have been made;
third,
to pay
ratably all interest (including Post-Petition Interest) on the Secured
Obligations payable under the Bridge Loan Agreement and any Notes, until
payment
in full of all such interest and fees shall have been made;
fourth,
to pay
all other Secured Obligations ratably until payment in full of all such
other
Secured Obligations shall have been made; and
finally,
to pay
to the relevant Pledgor, or as a court of competent jurisdiction may direct,
any
surplus then remaining from the proceeds of the Collateral owned by
it.
(b) In
making
the payments and allocations required by this Section, the Agent may rely
upon
information supplied to it pursuant to Section 13(c). All distributions
made by the Agent pursuant to this Section shall be final (except in the
event
of manifest error) and the Agent shall have no duty to inquire as to the
application by any Secured Party of any amount distributed to it.
Section
10. Fees
and Expenses; Indemnification
.
(a) The
Pledgors will forthwith upon demand pay to the Agent:
(i) the
amount of any taxes that the Agent may have been required to pay by reason
of
the Transaction Liens or to free any Collateral from any other Lien
thereon;
(ii) the
amount of any and all reasonable out-of-pocket expenses, including transfer
taxes and reasonable fees and expenses of counsel and other experts, that
the
Agent may incur in connection with (x) the administration or enforcement
of the
Collateral Documents, including such expenses as are incurred to preserve
the
value of the Collateral or the validity, perfection, rank or value of any
Transaction Lien, (y) the collection, sale or other disposition of any
Collateral or (z) the exercise by the Agent of any of its rights or powers
under
the Collateral Documents; and
(iii) the
amount required to indemnify the Agent for, or hold it harmless and defend
it
against, any loss, liability or expense (including the reasonable fees
and
expenses of its counsel and any experts or sub-agents appointed by it hereunder)
incurred or suffered by the Agent in connection with the Collateral Documents,
except to the extent that such loss, liability or expense arises from the
Agent’s gross negligence or willful misconduct or a breach of any duty that the
Agent has under this Agreement (after giving effect to Sections 12 and
13).
Any
such
amount not paid to the Agent on demand will bear interest for each day
thereafter until paid at a rate per annum equal to the sum of 2% plus the
rate
applicable to Alternate Base Rate Loans for such day.
(b) If
any
transfer tax, documentary stamp tax or other tax is payable in connection
with
any transfer or other transaction provided for in the Collateral Documents,
the
Pledgors will pay such tax and provide any required tax stamps to the Agent
or
as otherwise required by law.
Section
11. Authority
To Administer Collateral
.
Each
Pledgor irrevocably appoints the Agent its true and lawful attorney, with
full
power of substitution, in the name of such Pledgor, any Secured Party or
otherwise, for the sole use and benefit of the Secured Parties, but at
the
Pledgors’ expense, to the extent permitted by law to exercise, at any time and
from time to time while an Event of Default shall have occurred and be
continuing, all or any of the following powers with respect to all or any
of
such Pledgor’s Collateral (but the Agent shall not be obligated to and shall
have no liability to such Pledgor or any third party for failure to so
do or
take action):
(a) to
demand, xxx for, collect, receive and give acquittance for any and all
monies
due or to become due upon or by virtue thereof;
(b) to
settle, compromise, compound, prosecute or defend any action or proceeding
with
respect thereto;
(c) to
sell,
lease, license or otherwise dispose of the same or the proceeds or avails
thereof, as fully and effectually as if the Agent were the absolute owner
thereof;
(d) to
extend
the time of payment of any or all thereof and to make any allowance or
other
adjustment with reference thereto; and
(e) to
take
any other action and to execute any instrument consistent with the terms
of the
Bridge Loan Agreement and the Collateral Documents which the Agent may
deem
necessary or advisable to accomplish the purposes hereof.
Section
12. Limitation
on Duty in Respect of Collateral
.
Beyond
the exercise of reasonable care in the custody and preservation thereof,
the
Agent will have no duty as to any Collateral in its possession or control
or in
the possession or control of any sub-agent or bailee or any income therefrom
or
as to the preservation of rights against prior parties or any other rights
pertaining thereto. The Agent will be deemed to have exercised reasonable
care
in the custody and preservation of the Collateral in its possession or
control
if such Collateral is accorded treatment substantially equal to that which
it
accords its own property, and will not be liable or responsible for any
loss or
damage to any Collateral, or for any diminution in the value thereof, by
reason
of any act or omission of any sub-agent or bailee selected by the Agent
in good
faith, except to the extent that such liability arises from the Agent’s gross
negligence or willful misconduct.
Section
13. General
Provisions Concerning the Agent
.
(a) The
provisions of Section 12 of the Bridge Loan Agreement shall inure to the
benefit
of the Agent, and shall be binding upon all Pledgors and all Secured Parties,
in
connection with this Agreement and the other Collateral Documents. Without
limiting the generality of the foregoing, (i) the Agent shall not be subject
to
any fiduciary or other implied duties, regardless of whether an Event of
Default
has occurred and is continuing, (ii) the Agent shall not have any duty to
take any discretionary action or exercise any discretionary powers, except
discretionary rights and powers expressly contemplated by the Collateral
Documents that the Agent is required in writing to exercise by the Majority
Banks (or such other number or percentage of the Banks as shall be necessary
under the circumstances as provided in Section 13.2 of the Bridge Loan
Agreement), and (iii) except as expressly set forth in the Loan Documents,
the Agent shall not have any duty to disclose, and shall not be liable
for any
failure to disclose, any information relating to any of the Borrowers or
any of
their respective Subsidiaries or any other Loan Party that is communicated
to or
obtained by the bank serving as Agent or any of its Affiliates in any capacity.
The Agent shall not be responsible for the existence, genuineness or value
of
any Collateral or for the validity, perfection, priority or enforceability
of
any Transaction Lien, whether impaired by operation of law or by reason
of any
action or omission to act on its part under the Collateral Documents. The
Agent
shall be deemed not to have knowledge of any Event of De-
(b) fault
unless and until written notice thereof is given to the Agent by the Borrowers
or a Secured Party.
(c) Sub-Agents
and Related Parties.
The
Agent
may perform any of its duties and exercise any of its rights and powers
through
one or more sub-agents appointed by it. The Agent and any such sub-agent
may
perform any of its duties and exercise any of its rights and powers through
its
Related Parties. The exculpatory provisions of Section 12 and this Section
shall apply to any such sub-agent and to the Related Parties of the Agent
and
any such sub-agent.
(d) Information
as to Secured Obligations and Actions by Secured Parties. For
all
purposes of the Collateral Documents, including determining the amounts
of the
Secured Obligations, or whether any action has been taken under any Loan
Document, the Agent will be entitled to rely on information from (i) its
own records for information as to the Banks, any of the Secured Obligations
and
actions taken by them, (ii) any Secured Party (or any trustee, agent or
similar representative designated pursuant to (iii) to supply such
information) for information as to any of the Secured Obligations and actions
taken by it, to the extent that the Agent has not obtained such information
from
its own records, and (iv) any Pledgor or any of the Borrowers or any other
Loan Party, to the extent that the Agent has not obtained information from
the
foregoing sources.
(e) Refusal
to Act.
The
Agent may refuse to act on any notice, consent, direction or instruction
from
any Secured Parties or any agent, trustee or similar representative thereof
that, in the Agent’s opinion, (i) is contrary to law or the provisions of
any Collateral Document, (ii) may expose the Agent to liability (unless the
Agent shall have been indemnified, to its reasonable satisfaction, for
such
liability by the Secured Parties that gave such notice, consent, direction
or
instruction) or (iii) is unduly prejudicial to Secured Parties not joining
in such notice, consent, direction or instruction.
(f) Copies
of Certain Notices.
Within
two Business Days after it receives or sends any notice referred to in
this
subsection, the Agent shall send to the Banks copies of any notice given
by the
Agent to any Pledgor, or received by it from any Pledgor, pursuant to Section
8,
9, 11 or 14.
Section
14. Termination
Of Transaction Liens; Release Of Collateral
.
(a) The
Transaction Liens shall terminate when all Commitments under the Bridge
Loan
Agreement shall have expired or been terminated and all the Secured Obligations
shall have been paid in full in cash (other than contingent indemnification
obligations).
(b) At
any
time before the Transaction Liens terminate, the Agent may, at the written
request of the Borrowers, release any Collateral with the prior written
consent
of the Banks.
(c) Upon
any
termination of a Transaction Lien or release of Collateral, the Agent will,
at
the expense of the relevant Pledgor, execute and deliver to such Pledgor
such
documents as such Pledgor shall reasonably request to evidence the termination
of such Transaction Lien or the release of such Collateral, as the case
may
be.
Section
15. Notices
.
Each
notice, request or other communication given to any party hereunder shall
be
given in accordance with Section 13.4 of the Bridge Loan Agreement
and in
the case of the Pledgors, any such notice, request or other communication
shall
be given to the address and fax numbers as follows:
If
to SUG
EAT, LLC: SUG
EAT,
Inc.
00
Xxxxx
Xxxxxx, 0xx
Xxxxx
Xxxxxxxx,
XX 00000
Att:
Xxxxxx Xxxxxx
fax:
(000) 000-0000
with
a
copy to: Southern
Union Company
Southern
Union Panhandle LLC
0000
Xxxxxxxxxx Xxxx
Xxxxxxx,
Xxxxx 00000
Attention:
Xxxxxx Xxxxxxxx, Esq.
Fax:
(000) 000-0000
If
to SUG
EAT, INC. SUG
EAT,
Inc.
000
X.
XxXxxxx Xxxxxx, Xxxxx 0000
Xxxxxxx,
XX 00000
Att:
Xxxx
Xxxxxxxxxxx
fax:
(000) 000-0000
with
a
copy to: Southern
Union Company
Southern
Union Panhandle LLC
0000
Xxxxxxxxxx Xxxx
Xxxxxxx,
Xxxxx 00000
Attention:
Xxxxxx Xxxxxxxx, Esq.
Fax:
(000) 000-0000
Section
16. No
Implied Waivers; Remedies Not Exclusive
.
No
failure by the Agent or any Secured Party to exercise, and no delay in
exercising and no course of dealing with respect to, any right or remedy
under
any Collateral Document shall operate as a waiver thereof; nor shall any
single
or partial exercise by the Agent or any Secured Party of any right or remedy
under any Loan Document preclude any other or further exercise thereof
or the
exercise of any other right or remedy. The rights and remedies specified
in the
Loan Documents are cumulative and are not exclusive of any other rights
or
remedies provided by law.
Section
17. Successors
And Assigns
.
This
Agreement is for the benefit of the Agent and the Secured Parties. If all
or any
part of any Secured Party’s interest in any Secured Obligation is assigned or
otherwise transferred in accordance with the provisions of the Bridge Loan
Agreement, the assignee’s or transferor’s rights hereunder, to the extent
applicable to the obligation so transferred, shall be automatically transferred
with such obligation. This Agreement shall be binding on the Pledgors and
their
respective successors and assigns;
provided,
however,
that
no
Pledgor may assign any of its rights, interests or obligations herein without
the prior written consent of the Agent and all the Banks.
Section
18. Amendments
And Waivers
.
Neither
this Agreement nor any provision hereof may be waived, amended, modified
or
terminated except pursuant to an agreement or agreements in writing entered
into
by the Agent, with the consent of the Majority Banks, or, in the case of
any
such waiver, amendment or modification affecting the number of Banks required
to
release any of the Collateral, with the consent of all the Banks. No such
waiver, amendment or modification shall be binding upon any Pledgor, except
with
its written consent.
Section
19. Choice
Of Law
.
This
Agreement shall be construed in accordance with and governed by the laws
of the
State of New York, except as otherwise required by mandatory provisions
of law
and except to the extent that remedies provided by the laws of any jurisdiction
other than the State of New York are governed by the laws of such
jurisdiction.
Section
20. Waiver
Of Jury Trial
.
EACH
PARTY HERETO WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW,
ANY
RIGHT IT MAY HAVE TO A TRIAL BY JURY IN ANY LEGAL PROCEEDING DIRECTLY OR
INDIRECTLY ARISING OUT OF OR RELATING TO ANY COLLATERAL DOCUMENT OR ANY
TRANSACTION CONTEMPLATED THEREBY (WHETHER BASED ON CONTRACT, TORT OR ANY
OTHER
THEORY). EACH PARTY HERETO (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT
OR
ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT
SUCH
OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE
FOREGOING
WAIVER AND (B) ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN
INDUCED TO ENTER INTO THIS AGREEMENT BY, AMONG OTHER THINGS, THE MUTUAL
WAIVERS
AND CERTIFICATIONS IN THIS SECTION.
Section
21. Severability
.
If any
provision of any Collateral Document is invalid or unenforceable in any
jurisdiction, then, to the fullest extent permitted by law, (i) the other
provisions of the Collateral Documents shall remain in full force and effect
in
such jurisdiction and shall be liberally construed in favor of the Agent
and the
Secured Parties in order to carry out the intentions of the parties thereto
as
nearly as may be possible and (ii) the invalidity or unenforceability of
such
provision in such jurisdiction shall not affect the validity or enforceability
thereof in any other jurisdiction.
Section
22. Matters
Pertaining to Pledgors.
(a) Subrogation.
Each
Pledgor hereby agrees that until the payment and satisfaction in full in
cash of
all Secured Obligations and the expiration and termination of the Commitments
of
the Banks under the Bridge Loan Agreement it shall waive any claim and
shall not
exercise any right or remedy, direct or indirect, arising by reason of
any
performance by it of its obligations hereunder, whether by subrogation
or
otherwise, against the Borrowers or any other Loan Party of any of the
Secured
Obligations or any security for any of the Secured Obligations.
(b) Unconditional
and Absolute.
The
obligations of the Pledgors under this Agreement, to the fullest extent
permitted by applicable law, are absolute and unconditional, joint and
several,
irrespective of the value, genuineness, validity, regularity or enforceability
of the Se-
(c) cured
Obligations, or any substitution, release or exchange of any other guarantee
of
or security for any of the Secured Obligations, and, irrespective of any
other
circumstance whatsoever that might otherwise constitute a legal or equitable
discharge or defense of a surety or a Pledgor (except for payment in full).
Without limiting the generality of the foregoing, it is agreed that the
occurrence of any one or more of the following shall not alter or impair
the
liability of the Pledgors hereunder which shall remain absolute and
unconditional under any and all circumstances as described above:
(i) at
any
time or from time to time, without notice to the Pledgors, the time for
any
performance of or compliance with any of the Secured Obligations shall
be
extended, or such performance or compliance shall be waived;
(ii) any
of
the acts mentioned in any of the provisions of the Bridge Loan Agreement
or any
other Loan Document shall be done or omitted;
(iii) the
maturity of any of the Secured Obligations shall be accelerated, or any
of the
Secured Obligations shall be amended in any respect, or any right under
the Loan
Documents shall be amended or waived in any respect or the other Pledgor,
any
other pledgor or any security for the Secured Obligations shall be released
or
exchanged in whole or in part or otherwise dealt with;
(iv) any
Lien
or security interest granted to, or in favor of, Agent for the benefit
of the
Secured Parties as security for any of the Secured Obligations shall fail
to be
perfected; and
(v) any
other
circumstances which might constitute a defense available to, or a discharge
of,
any Pledgor.
(d) Waivers.
Each
Pledgor hereby expressly waives diligence, presentment, demand of payment,
protest and all notices whatsoever, and any requirement that any Secured
Party
exhaust any right, power or remedy or proceed against the Borrowers under
the
Bridge Loan Agreement, this Agreement, any other Loan Document, or any
other
agreement or instrument referred to herein or therein, or against any other
Person under this Agreement or under any guarantee of, or security for,
any of
the Secured Obligations. Each Pledgor waives any and all notice of the
creation,
renewal, extension, waiver, termination or accrual of any of the Secured
Obligations and notice of or proof of reliance by any Secured Party upon
this
Agreement as it pertains to the Pledgors or acceptance thereof, and all
dealings
between the Borrowers and the Secured Parties shall likewise be conclusively
presumed to have been had or consummated in reliance upon this Agreement.
The
obligations and liabilities of the Pledgors hereunder shall not be conditioned
or contingent upon the pursuit by the Secured Parties or any other Person
at any
time of any right or remedy against the Borrowers or against any other
Person
which may be or become liable in respect of all or any part of the Secured
Obligations or against any collateral security or guarantee therefor or
right of
offset with respect thereto. To the extent it may lawfully do so, each
Pledgor
absolutely and irrevocably waives and relinquishes the benefit and advantage
of,
and covenants not to assert against the Agent or any Secured Party, any
valuation, stay, appraisement, extension, redemption or similar laws and
any and
all rights or defenses it may have as a surety now or hereafter existing
which,
but for this provision, might be applicable to the sale of any Collateral
made
under the judgment, order or decree of any court, or privately
under
the
power of sale conferred by this Agreement, or otherwise. Each Pledgor further
waives any and all suretyship defenses.
(e) General
Limitation.
In any
action or proceeding involving any applicable state, federal or foreign
bankruptcy, insolvency, reorganization or other law affecting the rights
of
creditors generally, if the obligations of any Pledgor under this Agreement
would otherwise be held or determined to be void, voidable, invalid or
unenforceable, or subordinated to the claims of any other creditors, on
account
of the amount of its liability under this Agreement, then, notwithstanding
any
other provision to the contrary, the amount of such liability shall, without
any
further action by such Pledgor or any other Person, be automatically limited
and
reduced to the highest amount that is valid and enforceable and not subordinated
to the claims of other creditors as determined in such action or
proceeding.
(f) Independent
Investigation.
Each
Pledgor hereby acknowledges that it has undertaken its own independent
investigation of the financial condition of each of the Borrowers and all
other
matters pertaining to this Agreement, the Bridge Loan Agreement and the
other
Loan Document and further acknowledges that it is not relying in any manner
upon
any representation or statement of the Agent, any Bank or any of their
respective Related Parties with respect thereto. Each Pledgor represents
and
warrants that it has received and reviewed copies of the Loan Documents
and that
it is in a position to obtain, and it hereby assumes full responsibility
for
obtaining, any additional information concerning the financial condition
of each
Borrower and any other matters pertinent hereto that any Pledgor may desire.
No
Pledgor is relying upon or expecting the Agent, any Bank or any of their
respective Related Parties to furnish to such Pledgor any information now
or
hereafter in the Agent’s, any Bank’s or any of their respective Related Parties’
possession concerning the financial condition of any of the Borrowers or
any
other matter.
[Signature
pages follow]
IN
WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly
executed by their respective authorized officers as of the day and year
first
above written.
SUG
EAT,
INC., as a Pledgor
By: _/S/_DANIEL
FEEHAN_____________
Name:
Xxxxxx Xxxxxx
Title: Senior
Vice President
SUG
EAT,
LLC, as a Pledgor
By:
Southern Union Panhandle LLC, as its Sole Manager
By:
Southern Union Company, as its Sole Member
By:
_/S/
XXXXX X. EDWARDS____________
Name:
Xxxxx X. Xxxxxxx
Title:
Senior Vice President and Chief
Financial
Officer
XXXXXX
COMMERCIAL PAPER INC.,
as
Administrative Agent
By: _/S/
XXXXXX X. PERPER__________________
Name:
Xxxxxx X. Xxxxxx
|
Title:
|
Senior
Vice President
|
[Signature
Page to Pledge Agreement (SUG EAT Entities)]
SCHEDULE
1(a)
PLEDGORS
INFORMATION
(as
of the Closing Date)
|
Name
of Pledgor
|
Type
of
Organization
|
Jurisdiction
of
Organization
|
Registered
Organization/
Organizational
I.D. Number
|
|
SUG
EAT, Inc.
|
Corporation
|
Delaware
|
4115790
|
|
SUG
EAT, LLC
|
Limited
liability Company
|
Delaware
|
4116240
|
SCHEDULE
1(b)
PRIOR
ORGANIZATIONAL NAMES
|
Pledgor
|
Prior
Name
|
Date
of Change
|
|
SUG
EAT, Inc.
|
None
|
N/A
|
|
SUG
EAT, Inc.
|
None
|
N/A
|
SCHEDULE
1(c)
CHANGES
IN CORPORATE IDENTITY; OTHER NAMES
|
Pledgor
|
Corporate
Name of Entity
|
Action
|
Date
of Action
|
State
of Formation
|
List
of All Other Names Used During Past Five Years
|
|
SUG
EAT, Inc.
|
None
|
N/A
|
N/A
|
N/A
|
N/A
|
|
SUG
EAT, Inc.
|
None
|
N/A
|
N/A
|
N/A
|
N/A
|
[Add
Information required by Section 3(a) to the extent required by
Section 3(a)(iii)]
SCHEDULE
2
PART
A: CHIEF
EXECUTIVE OFFICES
|
Pledgor
|
Address
|
State
|
|
SUG
EAT, Inc.
|
000
X. XxXxxxx Xxxxxx, Xxxxx 0000
Xxxxxxx,
Xxxxxxxx 00000
|
Illinois
|
|
SUG
EAT, LLC
.
|
000
X. XxXxxxx Xxxxxx. Xxxxx 0000
Xxxxxxx
|
Xxxxxxxx
|
PART
B: LOCATION
OF BOOKS
|
Pledgor
|
Address
|
State
|
|
SUG
EAT, Inc.
|
000
X. XxXxxxx Xxxxxx, Xxxxx 0000
Xxxxxxx,
Xxxxxxxx 00000
|
Illinois
|
|
SUG
EAT, LLC
.
|
000
X. XxXxxxx Xxxxxx. Xxxxx 0000
Xxxxxxx
|
Xxxxxxxx
|
PART
C: OTHER
PLACES OF BUSINESS
|
Pledgor
|
Address
|
State
|
|
SUG
EAT, Inc.
|
00
Xxxxx Xxxxxx
Xxxxxxxx,
XX 00000
|
Massachusetts
|
|
SUG
EAT, LLC
.
|
00
Xxxxx Xxxxxx
Xxxxxxxx,
XX 00000
|
Massachusetts
|
PART
D: PRIOR
LOCATIONS MAINTAINED BY THE PLEDGORS
|
Pledgor
|
Address
|
State
|
|
SUG
EAT, Inc.
|
N/A
|
N/A
|
|
SUG
EAT, LLC
.
|
N/A
|
N/A
|
SCHEDULE
3
EQUITY
INTERESTS IN COLLATERAL OWNED BY THE PLEDGORS
(as
of the Closing Date)
|
Issuer
|
Jurisdiction
of
Organization
|
Owner
of
Equity
Interest
|
Percentage
Owned
|
Number
of
Shares
or Units
|
|
Richardson
Energy
Marketing,
Ltd.
|
Texas
|
SUG
EAT, Inc.
|
100%
of the Limited
Partnership
Interests
|
N/A
|
|
Richardson
Energy
Marketing,
Ltd.
|
Texas
|
SUG
EAT, LLC
|
100%
of the General
Partnership
Interests
|
N/A
|
|
Xxx
Xxxxxxxxxx
Energy
Services, Ltd.
|
Texas
|
SUG
EAT, Inc.
|
100%
of the Limited
Partnership
Interests
|
N/A
|
|
Xxx
Xxxxxxxxxx
Energy
Services, Ltd.
|
Texas
|
SUG
EAT, LLC
|
100%
of the General
Partnership
Interests
|
N/A
|
|
Leapartners,
LP
|
Texas
|
SUG
EAT, LLC
|
100%
of the General
Partnership
Interests
|
N/A
|
SCHEDULE
4
FILING
OFFICE
Secretary
of State’s Office for the State of Delaware
EXHIBIT
E
FORM
OF IN-HOUSE COUNSEL OPINION
EXHIBIT
F
FORM
OF INTERCREDITOR AGREEMENT
