GUARANTY AGREEMENT
THIS GUARANTY AGREEMENT (this "Guaranty") is dated as of October
14, 1998 and is by QUESTAR PIPELINE CO., a Utah corporation (the
"Guarantor"), in favor of BANK OF AMERICA NATIONAL TRUST AND SAVINGS
ASSOCIATION, as agent (in such capacity, the "Administrative Agent")
for its benefit and for the ratable benefit of the financial
institutions (the "Banks") now or hereafter party to that certain
Credit Agreement dated as of October 14, 1998 (as the same may be
amended, modified or restated from time to time and at any time, the
"Credit Agreement"), among TransColorado Gas Transmission Company (the
"Borrower"), the Banks, and the Administrative Agent.
W I T N E S S E T H:
WHEREAS, pursuant to the terms of the Credit Agreement, the Banks
have agreed to extend credit to the Borrower;
WHEREAS, the obligation of the Banks to extend credit is
conditioned upon, among other things, the execution and delivery by
the Guarantor of this Guaranty;
WHEREAS, Questar TransColorado, Inc., a wholly-owned subsidiary
of Guarantor, owns a fifty percent (50%) partnership equity interest
in Borrower, and the Guarantor will derive substantial direct and
indirect economic benefit from the extensions of credit pursuant to
the Credit Agreement;
NOW, THEREFORE, (i) in consideration of the premises and to
induce the Banks to enter into the Credit Agreement and to extend
credit, (ii) at the special insistence and request of the
Administrative Agent and the Banks, and (iii) for other good and
valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, the Guarantor, for the benefit of the
Administrative Agent and the Banks, hereby agrees as follows:
Section 1.Defined Terms. All capitalized terms used but not
defined herein shall have the meanings set forth in Schedule 1 hereto,
except that capitalized terms used herein but not defined herein or in
Schedule 1 shall have the meanings set forth in the Credit Agreement.
Section 2.Guaranty. (a) The Guarantor hereby,
unconditionally and irrevocably, severally with the Other Guarantors
(as such term is defined in Section 17 hereof) and not jointly or
jointly and severally, guarantees the prompt performance and payment
in full in Dollars when due (whether at stated maturity, by
acceleration or otherwise) of the Obligations (including, without
limitation, all costs, fees and expenses incurred by the
Administrative Agent or any Bank in enforcing any rights under this
Guaranty and reasonable counsel fees of outside counsel, and the
allocated cost of in-house counsel).
(b) Notwithstanding anything herein or in any other Loan
Document to the contrary, the maximum liability of the Guarantor under
this Guaranty at any time shall not exceed an amount equal to fifty
percent (50.00%) of the dollar amount of the Obligations then
outstanding. The amount of the Obligations for which Guarantor is
liable hereunder shall be reduced by the amount of any principal
payments made by the Guarantor (but not by the amount of payments made
by any Other Guarantor) on behalf of the Borrower but only if (i) such
payments are clearly identified as such in a written notice delivered
to the Administrative Agent and (ii) the amount of the Commitments is
permanently reduced by the amount of such payment.
Section 3.Guaranty Absolute.
(a) The obligations of the Guarantor hereunder are those of
a primary obligor, and not merely a surety, and are independent of the
Obligations. A separate action or actions may be brought against the
Guarantor whether or not an action is brought against the Borrower,
any other guarantor or other obligor in respect of the Obligations or
whether the Borrower, any other guarantor or any other obligor in
respect of the Obligations are joined in any such action or actions.
(b) The Guarantor guarantees that the Obligations will be
paid and performed strictly in accordance with the terms of the Credit
Agreement and the other Loan Documents regardless of any law,
regulation or order now or hereafter in effect in any jurisdiction
affecting any of such terms or the rights of the Administrative Agent
or the Banks with respect thereto. Guarantor agrees that its
guarantee constitutes a guarantee of payment when due and not of
collection. The liability of the Guarantor under this Guaranty shall
be absolute and unconditional irrespective of:
(i) any lack of genuineness, validity, legality or
enforceability of the Credit Agreement, any other Loan Document or any
other document, agreement or instrument relating thereto or any
assignment or transfer of any thereof;
(ii) any change in the time, manner or place of payment of,
or in any other term of, all or any of the Obligations (including,
without limitation, the possible extension of the Maturity Date
(except as expressly provided in Section 16 hereof) and increase of
the amount of the Commitments all on the terms and conditions set
forth in the Credit Agreement), or any waiver, indulgence, compromise,
renewal, extension, amendment, modification of, or addition, consent,
supplement to, or consent to departure from, or any other action or
inaction under or in respect of, the Credit Agreement or any other
Loan Document or any document, instrument or agreement relating to the
Obligations or any other instrument or agreement referred to therein
or any assignment or transfer of any thereof;
(iii)any release or partial release of any other guarantor
or other obligor in respect of the Obligations;
(iv) any exchange, release or non-perfection of any
collateral for all or any of the Obligations, or any release, or
amendment or waiver of, or consent to departure from, any guaranty or
security, for all or any of the Obligations;
(v) any furnishing of any security for any of the
Obligations;
(vi) the liquidation, bankruptcy, insolvency or
reorganization of the Borrower, any other guarantor or other obligor
in respect of the Obligations or any action taken with respect to this
Guaranty by any trustee or receiver, or by any court, in any such
proceeding;
(vii)any modification or termination of any intercreditor or
subordination agreement pursuant to which the claims of other
creditors of the Borrower or the Guarantor are subordinated to those
of the Banks; or
(viii)any other circumstance which might otherwise
constitute a defense available to, or a legal or equitable discharge
of, the Borrower or the Guarantor.
(c) This Guaranty shall continue to be effective or be
reinstated, as the case may be, if at any time payment or performance
of the Obligations, or any part thereof, is, upon the insolvency,
bankruptcy or reorganization of the Borrower or the Guarantor or
otherwise pursuant to applicable law, rescinded or reduced in amount
or must otherwise be restored or returned by the Administrative Agent
or any Bank, all as though such payment or performance had not been
made.
(d) If an event permitting the acceleration of any of the
Obligations shall at any time have occurred and be continuing and such
acceleration shall at such time be prevented by reason of the pendency
against the Borrower of a case or proceeding under any bankruptcy or
insolvency law, the Guarantor agrees that, for purposes of this
Guaranty and its obligations hereunder, the Obligations shall be
deemed to have been accelerated and the Guarantor shall forthwith pay
such Obligations (including, without limitation, interest which but
for the filing of a petition in bankruptcy with respect to the
Borrower, would accrue on such Obligations), and the other obligations
hereunder, without any further notice or demand.
Section 4.Waivers. The Guarantor hereby waives promptness,
diligence, notice of intention to accelerate, notice of acceleration,
notice of acceptance and any and all other notices with respect to any
of the Obligations and this Guaranty and any requirement that the
Administrative Agent or any Bank protect, secure, perfect or insure
any security interest in or any Lien on any property subject thereto
or exhaust any right or take any action against the Borrower, any
other guarantor or any other Person or any collateral or security or
to any balance of any deposit accounts or credit on the books of any
Bank in favor of the Borrower or the Guarantor.
Section 5.Subrogation. The Guarantor will not exercise any
rights of subrogation, reimbursement or contribution, contractual
statutory or otherwise which it may acquire by way of subrogation
under this Guaranty, by any payment hereunder or otherwise, until all
of the Obligations have been paid in full in cash and all Commitments
have terminated.
Section 6.Representations and Warranties. The Guarantor
represents and warrants to the Administrative Agent and the Banks the
following:
(a) Corporate Existence and Power. The Guarantor and each
of its Material Subsidiaries: (i) is a corporation duly organized,
validly existing and in good standing under the laws of the
jurisdiction of its incorporation; (ii) has the power and authority
and all governmental licenses, authorizations, consents and approvals
to own its assets, carry on its business and to execute, deliver, and
perform its obligations under the Loan Documents; (iii) is duly
qualified as a foreign corporation and is licensed and in good
standing under the laws of each jurisdiction where its ownership,
lease or operation of property or the conduct of its business requires
such qualification or license, except as set forth in Schedule 6(a)
hereto; and (iv) is in compliance with all Requirements of Law.
(b) Corporate Authorization; No Contravention. The
execution, delivery and performance by the Guarantor of this Guaranty
and each other Loan Document to which the Guarantor is party have been
duly authorized by all necessary corporate action, and do not: (i)
contravene the terms of any of the Guarantor's Organization Documents;
(ii) a conflict with or result in any breach or contravention of, or the
creation of any Lien under, any document evidencing any Contractual
Obligation to which the Guarantor is a party or any order, injunction,
writ or decree of any Governmental Authority to which the Guarantor or
its property is subject; or (iii) violate any Requirement of Law.
(c) Governmental Authorization. No approval, consent,
exemption, authorization, or other action by, or notice to, or filing
with, any Governmental Authority is necessary or required in
connection with the execution, delivery or performance by, or
enforcement against, the Guarantor of this Guaranty or any other Loan
Document.
(d) Binding Effect. This Guaranty and each other Loan
Document to which the Guarantor is a party constitute the legal, valid
and binding obligations of the Guarantor, enforceable against the
Guarantor in accordance with their respective terms, except as
enforceability may be limited by applicable bankruptcy, insolvency, or
similar laws affecting the enforcement of creditors' rights generally
or by equitable principles relating to enforceability.
(e) Litigation. Except as set forth on the Guarantor's
Form 10Q dated as of June 30, 1998 and Guarantor's Form 8K dated
August 31, 1998, filed with the SEC, there are no actions, suits,
proceedings, claims or disputes pending, or to the best knowledge of
the Guarantor, threatened or contemplated, at law, in equity, in
arbitration or before any Governmental Authority, against the
Guarantor, or its Material Subsidiaries or any of their respective
properties which: (i) purport to affect or pertain to this Agreement
or any other Loan Document, or any of the transactions contemplated
hereby or thereby; or (ii) if determined adversely to the Guarantor or
its Material Subsidiaries, would reasonably be expected to have a
Material Adverse Effect. No injunction, writ, temporary restraining
order or any order of any nature has been issued by any court or other
Governmental Authority purporting to enjoin or restrain the execution,
delivery or performance of this Agreement or any other Loan Document,
or directing that the transactions provided for herein or therein not
be consummated as herein or therein provided.
(f) No Default. No Default or Event of Default exists or
would result from the incurring of any Obligations by the Guarantor.
As of the Closing Date, neither the Guarantor nor any Material
Subsidiary is in default under or with respect to any Contractual
Obligation in any respect which, individually or together with all
such defaults, could reasonably be expected to have a Material Adverse
Effect, or that would, if such default had occurred after the Closing
Date, create an Event of Default under subsection 8(d).
(g) ERISA Compliance. (i) Each Plan is in compliance in
all material respects with the applicable provisions of ERISA, the
Code and other federal or state law. Each Plan which is intended to
qualify under Section 401(a) of the Code has received a favorable
determination letter from the IRS and to the best knowledge of the
Guarantor, nothing has occurred which would cause the loss of such
qualification. The Guarantor and each ERISA Affiliate has made all
required contributions to any Plan subject to Section 412 of the Code,
and no application for a funding waiver or an extension of any
amortization period pursuant to Section 412 of the Code has been made
with respect to any Plan.
(ii) There are no pending or, to the best knowledge of
Guarantor, threatened claims, actions or lawsuits, or action by any
Governmental Authority, with respect to any Plan which has resulted or
could reasonably be expected to result in a Material Adverse Effect.
There has been no prohibited transaction or violation of the fiduciary
responsibility rules with respect to any Plan which has resulted or
could reasonably be expected to result in a Material Adverse Effect.
(iii)(A) No ERISA Event has occurred or is reasonably
expected to occur; (B) no Pension Plan has any Unfunded Pension
Liability; (C) neither the Guarantor nor any ERISA Affiliate has
incurred, or reasonably expects to incur, any liability under Title IV
of ERISA with respect to any Pension Plan (other than premiums due and
not delinquent under Section 4007 of ERISA); (D) neither the Guarantor
nor any ERISA Affiliate has incurred, or reasonably expects to incur,
any liability (and no event has occurred which, with the giving of
notice under Section 4219 of ERISA, would result in such liability)
under Section 4201 or 4243 of ERISA with respect to a Multiemployer
Plan; and (E) neither the Guarantor nor any ERISA Affiliate has
engaged in a transaction that could be subject to Section 4069 or
4212(c) of ERISA.
(h) Title to Properties. The Guarantor and each Material
Subsidiary have good record and marketable title in fee simple to, or
valid leasehold interests in, all real property necessary or used in
the ordinary conduct of their respective businesses, except for such
defects in title as could not, individually or in the aggregate, have
a Material Adverse Effect. As of the Closing Date, the property of the
Guarantor and its Material Subsidiaries is subject to no Liens, other
than Permitted Liens.
(i) Taxes. The Guarantor and its Material Subsidiaries
have filed all Federal and other material tax returns and reports
required to be filed, and have paid all Federal and other material
taxes, assessments, fees and other governmental charges levied or
imposed upon them or their properties, income or assets otherwise due
and payable, except those which are being contested in good faith by
appropriate proceedings and for which adequate reserves have been
provided in accordance with GAAP. There is no proposed tax assessment
against the Guarantor or any Material Subsidiary that would, if made,
have a Material Adverse Effect.
(j) Financial Condition. (i) The audited consolidated
balance sheet of the Guarantor and its Subsidiaries as of December 31,
1997 and the related consolidated statements of income, operations,
shareholders' equity and cash flows for the fiscal year then ended, a
copy of which has been delivered to each of the Banks: (A) were
prepared in accordance with GAAP consistently applied throughout the
period covered thereby, except as otherwise expressly noted therein,
subject to ordinary, good faith year end audit adjustments; (B) fairly
present the financial condition of the Guarantor and its Subsidiaries
as of the date thereof and results of operations for the period
covered thereby; and (C) include all material indebtedness and other
liabilities, direct or contingent, of the Guarantor and its
consolidated Subsidiaries as of the date thereof, including
liabilities for taxes, material commitments and Contingent
Obligations.
(ii) The unaudited consolidated financial statements of the
Guarantor and its Subsidiaries dated June 30, 1998, and the related
consolidated statements of income or operations, shareholders' equity
and cash flows for the fiscal quarter ended on that date, a copy of
which has been delivered to each of the Banks: (A) were prepared in
accordance with GAAP consistently applied throughout the period
covered thereby, except as otherwise expressly noted therein, subject
to ordinary, good faith year end audit adjustments; (B) fairly present
the financial condition of the Guarantor and its Subsidiaries as of
the date thereof and results of operations for the period covered
thereby; and (C) include all material indebtedness and other
liabilities, direct or contingent, of the Guarantor and its
consolidated Subsidiaries as of the date thereof, including
liabilities for taxes, material commitments and Contingent
Obligations.
(iii)Since December 31, 1997, there has been no Material
Adverse Effect.
(k) Environmental Matters. The Guarantor conducts in the
ordinary course of business a review of the effect of existing
Environmental Laws and existing Environmental Claims on its business,
operations and properties, and as a result thereof the Guarantor has
reasonably concluded that such Environmental Laws and Environmental
Claims could not, individually or in the aggregate, reasonably be
expected to have a Material Adverse Effect.
(l) Regulated Entities. None of the Guarantor, any Person
controlling the Guarantor, or any Subsidiary, is an "Investment
Company" within the meaning of the Investment Company Act of 1940. The
Guarantor is not subject to regulation, the Federal Power Act, the
Interstate Commerce Act, any state public utilities code, or any other
Federal or state statute or regulation limiting its ability to incur
Indebtedness. Guarantor is a Wholly-Owned Subsidiary of Questar
Corporation and Questar Corporation is a "holding company" within the
meaning of the Public Utility Holding Company Act of 1935, as amended
("PUHCA"), which claims an exemption under 3(a)(1) of PUHCA. Each
of the Subsidiaries of Questar Corporation (including, without
limitation, the Guarantor) is a "subsidiary company" of a "holding
company" within the meaning of PUHCA. No consent or filing or any
other action under PUHCA is necessary for the valid execution and
delivery of this Guaranty or any other Loan Document or for the
performance by the Guarantor or its Subsidiaries of their respective
obligations thereunder.
(m) No Burdensome Restrictions. Neither the Guarantor nor
any Material Subsidiary is a party to or bound by any Contractual
Obligation, or subject to any restriction in any Organization
Document, or any Requirement of Law, which could reasonably be
expected to have a Material Adverse Effect.
(n) Copyrights, Patents, Trademarks and Licenses etc. The
Guarantor or its Material Subsidiaries own or are licensed or
otherwise have the right to use all of the patents, trademarks,
service marks, trade names, copyrights, contractual franchises,
authorizations and other rights that are reasonably necessary for the
operation of their respective businesses, without conflict with the
rights of any other Person. To the best legal knowledge of the
Guarantor, no slogan or other advertising device, product, process,
method, substance, part or other material now employed, or now
contemplated to be employed, by the Guarantor or any Material
Subsidiary infringes upon any rights held by any other Person. No
claim or litigation regarding any of the foregoing is pending or
threatened, and no patent, invention, device, application, principle
or any statute, law, rule, regulation, standard or code is pending or,
to the knowledge of the Guarantor, proposed, which, in either case,
could reasonably be expected to have a Material Adverse Effect.
(o) Subsidiaries. The Guarantor has no Subsidiaries other
than those specifically disclosed in part (a) of Schedule 6(o) hereto
and has no equity investments in any other corporation or entity other
than those specifically disclosed in part (b) of Schedule 6(o).
(p) Insurance. The properties of the Guarantor and its
Material Subsidiaries are insured with financially sound and reputable
insurance companies not Affiliates of the Guarantor, or through
self-insurance conforming to the requirements of Section 7(f) of this
Guaranty, in such amounts, with such deductibles and covering such
risks as are customarily carried by companies engaged in similar
businesses and owning similar properties in localities where the
Guarantor or such Material Subsidiary operates.
(q) Full Disclosure. None of the representations or
warranties made by the Guarantor in the Loan Documents as of the date
such representations and warranties are made or deemed made, and none
of the statements contained in any exhibit, report, statement or
certificate furnished by or on behalf of the Guarantor in connection
with the Loan Documents (including the offering and disclosure
materials delivered by or on behalf of the Guarantor to the Banks
prior to the Closing Date), contains any untrue statement of a
material fact or omits any material fact required to be stated therein
or necessary to make the statements made therein, in light of the
circumstances under which they are made, not misleading as of the time
when made or delivered.
(r) Year 2000.On the basis of a review and assessment of
the Guarantor's mission critical systems and equipment, and reasonable
inquiry made of the Guarantor's material suppliers, vendors and
customers, the Guarantor reasonably believes that the "Year 2000
problem", including costs of remediation, will not result in a
Material Adverse Effect with respect to the Guarantor. The Guarantor
is currently taking commercially reasonable steps to develop
contingency plans in the event of the failure of its own or a third
party's systems or equipment due to the Year 2000 problem.
(s) Benefit to Guarantor. Guarantor has determined that
its liability and obligation under this Guaranty will substantially
benefit it directly and indirectly, and its board of directors has
made that determination.
Section 7.Covenants. The Guarantor agrees that, until the
payment (after termination of the Commitments) in full (subject to
Section 2(b) above) of the Obligations and all other amounts payable
under this Guaranty, unless the Majority Banks waive compliance in
writing:
(a) Financial Statements. The Guarantor shall deliver to
the Administrative Agent, with sufficient copies for each Bank, in
form and detail satisfactory to the Administrative Agent and the
Majority Banks:
(i) as soon as available, but not later than 120 days after
the end of each fiscal year, a copy of the audited consolidated
balance sheet of the Guarantor and its Subsidiaries, and the related
consolidated statements of income or operations, shareholders' equity
and cash flows, as of the end of such fiscal year, setting forth in
each case in comparative form the figures for the previous fiscal
year, and accompanied by the opinion of a nationally-recognized
independent public accounting firm (the "Independent Auditor") which
report shall state that such consolidated financial statements present
fairly the financial position for the periods indicated in conformity
with GAAP applied on a basis consistent with prior years. Such opinion
shall not be qualified or limited because of a restricted or limited
examination by the Independent Auditor of any material portion of the
Guarantor's or any Subsidiary's records; and
(ii) as soon as available, but not later than 60 days after
the end of each of the first three fiscal quarters of each fiscal
year, a copy of the unaudited consolidated balance sheet of the
Guarantor and its Subsidiaries, and the related consolidated
statements of income, shareholders' equity and cash flows, as of the
end of such quarter, and certified by a Responsible Officer as fairly
presenting, in accordance with GAAP (subject to ordinary, good faith
year-end audit adjustments), the financial position and the results of
operations of the Guarantor and the Subsidiaries.
(b) Certificates: Other Information. The Guarantor shall
furnish to the Administrative Agent: (i) concurrently with the
delivery of the financial statements referred to in subsections
7(a)(i) and (ii), a Compliance Certificate executed by a Responsible
Officer; and (ii) promptly, copies of all financial statements and
reports that the Guarantor sends to its shareholders and, within 15
days of the filing thereof, copies of all financial statements and
regular, periodical or special reports (including Forms 10K, 10Q and
8K) that the Guarantor may make to, or file with, the SEC.
(c) Notices. The Guarantor shall promptly notify the
Administrative Agent:
(i) after acquiring knowledge thereof, of the occurrence of
any Default or Event of Default, and of the occurrence or existence of
any event or circumstance that foreseeably will become a Default or
Event of Default;
(ii) of any matter that has resulted or may result in a
Material Adverse Effect, including (A) breach or non-performance of,
or any default under, a Contractual Obligation of the Guarantor or any
Material Subsidiary; (B) any dispute, litigation, investigation,
proceeding or suspension between the Guarantor or any Material
Subsidiary and any Governmental Authority; or (C) the commencement of,
or any material development in, any litigation or proceeding affecting
the Guarantor or any Material Subsidiary; including pursuant to any
applicable Environmental Laws; and
(iii)after acquiring knowledge thereof, of the occurrence of
any of the following events affecting the Guarantor or any ERISA
Affiliate (but in no event more than 10 days after such event), and
deliver to the Administrative Agent a copy of any notice with respect
to such event that is filed with a Governmental Authority and any
notice delivered by a Governmental Authority to the Guarantor or any
ERISA Affiliate with respect to such event: (A) an ERISA Event; (B) a
material increase in the Unfunded Pension Liability of any Pension
Plan; (C) the adoption of, or the commencement of contributions to,
any Plan subject to Section 412 of the Code by the Guarantor or any
ERISA Affiliate; or (D) the adoption of any amendment to a Plan
subject to Section 412 of the Code, if such amendment results in a
material increase in contributions or Unfunded Pension Liability.
Each notice under this subsection shall be accompanied by a
written statement by a Responsible Officer setting forth details of
the occurrence referred to therein, and stating what action the
Guarantor or any affected Material Subsidiary proposes to take with
respect thereto and at what time. Each notice under subsection 6(c)(i)
shall describe with particularity any and all clauses or provisions of
this Agreement or other Loan Document that have been (or foreseeably
will be) breached or violated.
(d) Preservation of Corporate Existence. Etc. The
Guarantor shall, and shall cause each Material Subsidiary to: (i)
preserve and maintain in full force and effect its corporate existence
and good standing under the laws of its state or jurisdiction of
incorporation; (ii) preserve and maintain in full force and effect all
material governmental rights, privileges, qualifications, permits,
licenses and franchises necessary or desirable in the normal conduct
of its business except in connection with transactions permitted by
Section 7(m) and Section 7(n); (iii) use reasonable efforts, in the
ordinary course of business, to preserve its business organization and
goodwill; and (iv) preserve or renew all of its registered patents,
trademarks, trade names and service marks, the non-preservation of
which could reasonably be expected to have a Material Adverse Effect.
(e) Maintenance of Property. The Guarantor shall maintain,
and shall cause each Material Subsidiary to maintain, and preserve all
its property which is used in its ordinary course of business in good
working order and condition, ordinary wear and tear excepted.
(f) Insurance. The Guarantor shall maintain, and shall
cause each Material Subsidiary to maintain, with financially sound and
reputable independent insurers, or through self-insurance, insurance
with respect to its properties and business against loss or damage of
the kinds customarily insured against by Persons engaged in the same
or similar business, of such types and in such amounts as are
customarily carried under similar circumstances by such other Persons.
Such insurance may include self-insurance or be subject to
co-insurance, deductibility or similar clauses which, in effect,
result in self-insurance of certain losses, provided that such
self-insurance is in accord with the approved practices of
corporations similarly situated and adequate insurance reserves are
maintained in connection with such self-insurance, and,
notwithstanding the foregoing provisions of this Section 7(f) the
Guarantor or any Subsidiary may effect workers' compensation or
similar insurance in respect of operations in any state or other
jurisdiction either through an insurance fund operated by such state
or other jurisdiction or by causing to be maintained a system or
systems of self-insurance in accord with applicable laws.
(g) Payment of Obligations. The Guarantor shall, and shall
cause each Material Subsidiary to, pay and discharge as the same shall
become due and payable, all their respective obligations and
liabilities, including: (i) all tax liabilities, assessments and
governmental charges or levies upon it or its properties or assets,
unless the same are being contested in good faith by appropriate
proceedings and adequate reserves in accordance with GAAP are being
maintained by the Guarantor or such Material Subsidiary; (ii) all
lawful claims which, if unpaid, would by law become a Lien upon its
property; and (iii) all indebtedness, as and when due and payable, but
subject to any subordination provisions contained in any instrument or
agreement evidencing such Indebtedness.
(h) Compliance with Laws. The Guarantor shall comply, and
shall cause each Material Subsidiary to comply, in all material
respects with all Requirements of Law of any Governmental Authority
having jurisdiction over it or its business (including the Federal
Fair Labor Standards Act), except such as may be contested in good
faith or as to which a bona fide dispute may exist.
(i) Compliance with ERISA. The Guarantor shall, and shall
cause each of its ERISA Affiliates to: (i) maintain each Plan in
compliance in all material respects with the applicable provisions of
ERISA, the Code and other federal or state law; (ii) cause each Plan
which is qualified under Section 401(a) of the Code to maintain such
qualification; and (iii) make all required contributions to any Plan
subject to Section 412 of the Code.
(j) Inspection of Property and Books and Records. The
Guarantor shall maintain and shall cause each Material Subsidiary to
maintain proper books of record and account, in which full, true and
correct entries in conformity with GAAP consistently applied shall be
made of all financial transactions and matters involving the assets
and business of the Guarantor and such Material Subsidiary. The
Guarantor shall permit, and shall cause each Material Subsidiary to
permit, representatives and independent contractors of the
Administrative Agent and the Banks to visit and inspect any of their
respective properties, to examine their respective corporate,
financial and operating records, and make copies thereof or abstracts
therefrom, and to discuss their respective affairs, finances and
accounts with their respective directors, officers, and independent
public accountants, all at the expense of the Administrative Agent and
the Banks and at such reasonable times during normal business hours
and as often as may be reasonably desired, upon reasonable advance
notice to the Guarantor; provided, however, when an Event of Default
exists the Administrative Agent and the Banks may do any of the
foregoing at the expense of the Guarantor at any reasonable time
during normal business hours and without advance notice.
(k) Environmental Laws. The Guarantor shall, and shall
cause each Material Subsidiary to, conduct its operations and keep and
maintain its property in compliance with all Environmental Laws in all
material respects.
(l) Limitation on Liens. Except as hereinafter in this
Section 7(l) expressly permitted and as permitted by Section 7(n), so
long as any Bank shall have any Commitment under the Credit Agreement
or any of the Obligations remain outstanding, the Guarantor will not
at any time directly or indirectly create, assume or suffer to exist,
and will not cause, suffer or permit any Subsidiary to create, assume
or suffer to exist, otherwise than in favor of the Guarantor or a
Subsidiary, any Liens upon any of its properties or assets, real,
personal or mixed, whether owned at the date of this Guaranty or
thereafter acquired, or of or upon, any income or profits therefrom,
without making effective provision, and the Guarantor covenants that
in any such case it will make or cause to be made effective provision,
whereby the Obligations then or thereafter outstanding shall be
secured by such Liens equally and ratably with any and all other
obligations and indebtedness thereby secured, so long as any such
other obligations or indebtedness shall be so secured.Nothing in this
Section 7(l) shall be construed to prevent the Guarantor or any
Subsidiary from creating, assuming or suffering to exist Liens of the
following character ("Permitted Liens"), to all of which the
provisions of the first sentence of this Section 7(l) shall not be
applicable:
(i) Liens existing as of the date of this Guaranty;
(ii) Any purchase money mortgage or Lien created to secure
all or part of the purchase price of any property (or to secure a loan
made to the Guarantor or any Subsidiary to enable it to acquire the
property described in such mortgage or in any applicable security
agreement); provided that such Lien shall extend only to the property
so acquired, improvements thereon, replacements thereof and the income
or profits therefrom;
(iii)Liens on any property at the time of the acquisition
thereof, whether or not assumed by the Guarantor or a Subsidiary;
provided that such Lien shall extend only to the property so acquired,
improvements thereon, replacements thereof and the income or profits
therefrom;
(iv) Liens on any property or any contract for the sale of
any product or service, or any rights thereunder or any proceeds
therefrom, acquired or constructed by the Guarantor or a Subsidiary,
and created not later than twelve months after (A) such acquisition or
completion of such construction, or (B) commencement of operation of
such property, whichever is later; provided that such Lien shall
extend only to the property so acquired or constructed, improvements
thereon, replacements thereof and the income or profits therefrom;
(v) Liens on the properties or assets, real, personal or
mixed, of a Subsidiary, or of or upon or in any income or profits
therefrom, which is outstanding at the time such Subsidiary becomes a
Subsidiary;
(vi) Liens created or assumed by the Guarantor or a
Subsidiary on coal, geothermal, oil, natural gas, inert gas, other
hydrocarbon or mineral properties owned or leased by the Guarantor or
a Subsidiary to secure loans to the Guarantor or a Subsidiary for the
purpose of developing such properties;
(vii)Liens on any investment of the Guarantor or a
Subsidiary in any Person other than a Subsidiary or any security
representing any investment of the Guarantor or a Subsidiary; for the
purposes of this subsection (vii), "investment" means any equity
investment in any Person, any obligation of any Person for money
borrowed or for the deferred purchase price of property which is owed
to the Guarantor or a Subsidiary, as the case may be, and any amount
advanced to any person by the Guarantor or any Subsidiary, excluding,
however, current accounts payable other than for cash advances;
(viii)Any Lien not otherwise permitted by this Section 7(l)
if, after giving effect to the creation or assumption of the proposed
mortgage, pledge, lien, encumbrance or security interest the sum of
(A) all indebtedness of the Guarantor and its Subsidiaries secured by
Liens not otherwise permitted by this Section 7(l), and (B) to the
extent not included in (A) above, all Attributable Debt of the
Guarantor and its Subsidiaries does not exceed 10% of Consolidated
Capitalization;
(ix) Any refunding or extension of maturity, in whole or in
part, of any obligation or indebtedness secured by any Lien created,
existing or assumed in accordance with the provisions of subsections
(i) through (viii) above, inclusive, provided that the principal
amount of the obligation or indebtedness secured by such refunding or
extended Liens shall not exceed the principal amount of the obligation
or indebtedness to be refunded or extended outstanding at the time of
such refunding or extension, together with related financing costs,
and that such refunding or extended Liens shall be limited in lien to
the same property that secured the obligation or indebtedness refunded
or extended, and property substituted therefor and property acquired
after the date thereof and subject to the lien thereof, in accordance
with the provisions of such refunding or extension;
(x) Liens on any office equipment or data processing
equipment (including, without limitation, computer and computer
peripheral equipment) or any motor vehicles, tractors or trailers;
(xi) Liens of or upon or in current assets of the Guarantor
or a Subsidiary, determined in accordance with GAAP, created or
assumed to secure indebtedness incurred in the ordinary course of
business;
(xii)Mechanics' or materialmen's liens; any Lien or charge
arising by reason of pledges or deposits to secure payment of or to
permit participation in workmen's compensation, unemployment
insurance, old age pensions or other Social Security or other
insurance or to permit self-insurance; good faith deposits in
connection with tenders or leases of real estate, bids or contracts or
in connection with the financing of the acquisition or construction of
property to be used in the business of the Guarantor or a Subsidiary;
deposits to secure public or statutory obligations; deposits to secure
or in lieu of surety, stay or appeal bonds; deposits as security for
the payment of taxes or assessments or other similar charges; judgment
liens against the Guarantor or any Subsidiary thereof in an aggregate
amount not in excess $5,000,000, or any such judgment lien so long as
the finality of such judgment is being contested and execution thereon
is stayed and which has been appealed and secured, if necessary, by
the filing of an appeal bond; and liens for taxes or assessments for
the current year or which are not due or which remain payable without
penalty or which are being contested in good faith and against which
an adequate reserve has been established;
(xiii)Any lien arising by reason of deposits with or the
giving of any form of security to any governmental agency or any body
created or approved by law or governmental regulation for any purpose
at any time in connection with the financing of the acquisition or
construction of property to be used in the business of the Guarantor
or a Subsidiary, or as required by law or governmental regulation as a
condition to the transaction of any business or the exercise of any
privilege or license, or to permit the maintenance of self-insurance
or participation in any fund for liability on any insurance risks or
in connection with workmen's compensation, unemployment insurance, old
age pensions or other social security or to share in the privileges or
benefits required for companies participating in such arrangements;
(xiv)Liens which are payable, both with respect to principal
and interest, solely out of the proceeds of natural gas, oil, coal,
geothermal resources, inert gas, hydrocarbons or minerals to be
produced from the property subject thereto and to be sold or delivered
by the Guarantor or a Subsidiary;
(xv) Liens to secure indebtedness incurred to finance
advances made by the Guarantor or any Subsidiary to any third party
for the purpose of financing oil, natural gas, hydrocarbon, inert gas
or other mineral exploration or development, provided that such liens
shall extend only to the receivables of the Guarantor or such
Subsidiary in respect of such advances;
(xvi)Any rights reserved in others to take or reserve any
part of the natural gas, oil, coal, geothermal resources, inert gas,
other hydrocarbons or mineral produced at any time on any property of
the Guarantor or a Subsidiary;
(xvii)Any rights reserved to or vested in, or any
obligations or duties to, any person, firm, corporation or
governmental authority by the terms of any franchise, grant, lease,
license, easement or permit or by any provision of law with respect to
any property of the Guarantor or a Subsidiary;
(xviii)Leases (whether pursuant to Sale and Leaseback
Transactions or otherwise) now or hereafter existing and any renewals
or extensions thereof;
(xix)Liens upon the underlying interests in property covered
by any lease, contract, easement or right-of-way existing at the time
of the acquisition thereof; easements or similar encumbrances, the
existence of which does not materially impair the use of the property
subject thereto for the purposes for which it was acquired; liens upon
rights-of-way for pipeline or distribution plant purposes and
undetermined liens and charges incidental to construction or
maintenance; or defects and irregularities in the titles to any
property (including right-of-way) which are not material to the
business of the Guarantor and its Subsidiaries considered as a whole;
(xx) The lien reserved in leases for rent and for compliance
with the terms of the lease in the case of leasehold estates;
(xxi)Zoning laws and ordinances; and
(xxii)Liens which secure indebtedness of a Subsidiary to the
Guarantor or another Subsidiary.
If at anytime the Guarantor or any Subsidiary shall create or assume
any Lien to which the covenant in the first sentence of this Section
7(l) is applicable, the Guarantor will promptly deliver to the
Administrative Agent a certificate of a Responsible Officer, stating
that such covenant has been complied with, and an opinion of counsel
to the Guarantor, stating that in their opinion such covenant has been
complied with and that any instruments executed by the Guarantor or
any Subsidiary in the performance of such covenant complied with the
requirements thereof. The Administrative Agent may accept a
certificate of a Responsible Officer and an opinion of counsel as
conclusive evidence that any such steps taken to secure the
Obligations equally and ratably comply with the provisions of this
Section 7(l).
(m) Limitation on Sale and Leaseback Transactions. The
Guarantor shall not, and shall not permit any Subsidiary to, enter
into a Sale and Leaseback Transaction unless:
(i) the term of the lease is for 60 months or less; or
(ii) the lease is between the Guarantor and a Subsidiary or between
Subsidiaries; or
(iii)on the effective date of the lease the sum of (A) all
Indebtedness of the Guarantor and its Subsidiaries secured by Liens
not permitted by Section 7(l) (other than Section 7(l)(viii)), and (B)
to the extent not included in (A) above, all Attributable Debt of the
Guarantor and its subsidiaries, does not exceed 10% of Consolidated
Capitalization; or
(iv) the Guarantor or such Subsidiary within 120 days after the
effective date of the lease, applies an amount equal to the greater of
(A) the net proceeds of the sale of the property leased in such Sale
and Leaseback Transaction or (B) the fair market value (as determined
in good faith by the Board of Directors) of such property on any date
within 90 days prior to the effective date of the lease, to the
retirement of Funded Debt of the Guarantor or any Subsidiary.
(n) Consolidation, Merger or Sale.Nothing contained in this
Guaranty shall prevent any consolidation or merger of the Guarantor
with or into any other Person or Persons (whether or not affiliated
with the Guarantor), or successive consolidations or mergers in which
the Guarantor or its successor or successors shall be a party or
parties, or shall prevent any conveyance, transfer or lease of the
property of the Guarantor as an entirety or substantially as an
entirety, to any other Person (whether or not affiliated with the
Guarantor); provided, however, that:
(i) in case the Guarantor shall consolidate with or merge
into another Person or convey, transfer or lease its properties and
assets substantially as an entirety to any Person, the entity formed
by such consolidation or into which the Guarantor is merged or the
Person which acquires by conveyance or transfer, or which leases, the
properties and assets of the Guarantor substantially as an entirety
shall be a corporation organized and existing under the laws of the
United States of America, any state thereof or the District of
Columbia and shall expressly assume, by an instrument supplemental
hereto, executed and delivered by the successor Person to the
Administrative Agent for the benefit of the Administrative Agent and
the Banks, in form satisfactory to the Administrative Agent and the
Banks, the due and punctual payment and performance of each and every
covenant of this Guaranty on the part of the Guarantor to be performed
or observed;
(ii) immediately after giving effect to such transaction, no
event which, after notice or lapse of time, would become an Event of
Default, shall have occurred and be continuing; and
(iii)each of the Guarantor and the successor Person shall
have delivered to the Administrative Agent a certificate of a
Responsible Officer and an opinion of counsel, each stating that such
consolidation, merger, conveyance, transfer or lease and such
supplemental instrument comply with this Section 7(n) and that all
conditions precedent herein provided for relating to such transaction
have been complied with.
Upon any consolidation by the Guarantor with or merger by the
Guarantor into any other Person or any conveyance, transfer or lease
of the properties and assets of the Guarantor substantially as an
entirety in accordance with this Section 7(n), the successor Person
formed by such consolidation or into which the Guarantor is merged or
to which such conveyance, transfer or lease is made shall succeed to,
and be substituted for and be liable for, the Guarantor under this
Guaranty with the same effect as if such successor Person had been
named as the Guarantor herein.
(o) Transactions with Affiliates. The Guarantor shall not,
and shall not suffer or permit any Material Subsidiary to, enter into
any transaction with any Affiliate of the Guarantor, except in
compliance with all Requirements of Law.
(p) ERISA. The Guarantor shall not, and shall not suffer
or permit any of its ERISA Affiliates to: (i) engage in a prohibited
transaction or violation of the fiduciary responsibility rules with
respect to any Plan which has resulted or could reasonably expected to
result in liability of the Guarantor in an aggregate amount in excess
of $10,000,000; or (ii) engage in a transaction that could be subject
to Section 4069 or 4212(c) of ERISA.
(q) Change in Business. The Guarantor shall not, and shall
not suffer or permit any Material Subsidiary to, engage in any
material line of business substantially different from those lines of
business carried on by the Guarantor and its Material Subsidiaries on
the date hereof.
Section 8.Event of Default. The occurrence of any of the
following events shall constitute an Event of Default hereunder
(sometimes called a "Event of Default"):
(a) Representation or Warranty. Any representation or
warranty by the Guarantor made or deemed made herein, in any other
Loan Document, or which is contained in any certificate, document or
financial or other statement by the Guarantor or any Responsible
Officer, furnished at any time under this Agreement, or in or under
any other Loan Document, is incorrect in any material respect on or as
of the date made or deemed made; or
(b) Specific Defaults. The Guarantor fails to perform or
observe any term, covenant or agreement contained in any of Section
7(c), 7(i), 7(l), 7(m), 7(n), 7(o), 7(p) or 7(q); or
(c) Defaults - Deliveries. The Guarantor fails to perform
or observe any term or covenant contained in any of Section 7(a) or
7(b) this Agreement, and such default shall continue unremedied for a
period of 30 days after the earlier of (i) the date upon which a
Responsible Officer knew or reasonably should have known of such
failure and (ii) the date upon which written notice thereof is given
to the Guarantor by the Administrative Agent; or
(d) Other Defaults. The Guarantor fails to perform or
observe any other term or covenant contained in this Agreement or any
other Loan Document, and such default shall continue unremedied for a
period of 60 days after the earlier of (i) the date upon which a
Responsible Officer knew or reasonably should have known of such
failure and (ii) the date upon which written notice thereof is given
to the Guarantor by the Administrative Agent; or
(e) Cross-Default. The Guarantor or any Material
Subsidiary (i) fails to make any payment in respect of any
indebtedness or Contingent Obligation having an aggregate principal
amount (including undrawn committed or available amounts and including
amounts owing to all creditors under any combined or syndicated credit
arrangement) of more than $10,000,000 when due (whether by scheduled
maturity, required prepayment, acceleration, demand, or otherwise) and
such failure continues after the applicable grace or notice period, if
any, specified in the relevant document on the date of such failure;
or (ii) fails to perform or observe any other condition or covenant,
or any other event shall occur or condition exist, under any agreement
or instrument relating to any such indebtedness or Contingent
Obligation, and such failure continues after the applicable grace or
notice period, if any, specified in the relevant document on the date
of such failure if the effect of such failure, event or condition is
to cause, or to permit the holder or holders of such Indebtedness or
beneficiary or beneficiaries of such Indebtedness (or a trustee or
agent on behalf of such holder or holders or beneficiary or
beneficiaries) to cause such indebtedness to be declared to be due and
payable prior to its stated maturity, or such Contingent Obligation to
become payable or cash collateral in respect thereof to be demanded;
or
(f) Insolvency; Voluntary Proceedings. The Guarantor or
any Material Subsidiary (i) ceases or fails to be solvent, or
generally fails to pay, or admits in writing its inability to pay, its
debts as they become due, subject to applicable grace periods, if any,
whether at stated maturity or otherwise; (ii) voluntarily ceases to
conduct its business in the ordinary course; (iii) commences any
Insolvency Proceeding with respect to itself; or (iv) takes any action
to effectuate or authorize any of the foregoing; or
(g) Involuntary Proceedings. (i) Any involuntary
Insolvency Proceeding Is commenced or filed against the Guarantor or
any Material Subsidiary, or any writ, judgment, warrant of attachment,
execution or similar process, is issued or levied against a
substantial part of the Guarantor's or any Material Subsidiary's
properties, and any such proceeding or petition shall not be
dismissed, or such writ, judgment, warrant of attachment, execution or
similar process shall not be released, vacated or fully bonded within
60 days after commencement, filing or levy; (ii) the Guarantor or any
Material Subsidiary admits the material allegations of a petition
against it in any Insolvency Proceeding, or an order for relief (or
similar order under non-U.S. law) is ordered in any Insolvency
Proceeding; or (iii) the Guarantor or any Material Subsidiary
acquiesces in the appointment of a receiver, trustee, custodian,
conservator, liquidator, mortgagee in possession (or agent therefor),
or other similar Person for itself or a substantial portion of its
property or business; or
(h) ERISA. (i) An ERISA Event shall occur with respect to
a Pension Plan or Multiemployer Plan which has resulted or could
reasonably be expected to result in liability of the Guarantor under
Title IV of ERISA to the Pension Plan, Multiemployer Plan or the PBGC
in an aggregate amount in excess of $10,000,000; (ii) the aggregate
amount of Unfunded Pension Liability among all Pension Plans at any
time exceeds $10,000,000; or (iii) the Guarantor or any ERISA
Affiliate shall fail to pay when due, after the expiration of any
applicable grace period, any installment payment with respect to its
withdrawal liability under Section 4201 of ERISA under a Multiemployer
Plan in an aggregate amount in excess of $10,000,000; or
(i) Monetary Judgments. One or more non-interlocutory
judgments, non-interlocutory orders, decrees or arbitration awards is
entered against the Guarantor of any Material Subsidiary involving in
the aggregate a liability (to the extent not covered by independent
third-party insurance as to which the insurer does not dispute
coverage) as to any single or related series of transactions,
incidents or conditions, of $5,000,000 or more, and the same shall
remain unsatisfied, unvacated and unstayed pending appeal for a period
of 60 days after the entry thereof; or
(j) Non-Monetary Judgments. Any non-monetary judgment,
order or decree is entered against the Guarantor or any Material
Subsidiary which does or would reasonably be expected to have a
Material Adverse Effect, and there shall be any period of 60
consecutive days during which a stay of enforcement of such judgment
or order, by reason of a pending appeal or otherwise, shall not be in
effect; or
(k) Change of Control (Guarantor). There occurs any Change
of Control; or
(l) Subsidiaries. The Guarantor shall at any time fail to
own and control, directly or indirectly, 80% of the voting capital
stock of a Material Subsidiary; or
(m) Loss of Licenses. The Federal Energy Regulatory
Commission or any other Governmental Authority revokes or fails to
renew any material license, permit or franchise of the Guarantor or
any Material Subsidiary, or the Guarantor or any Material Subsidiary
for any reason loses any material license, permit or franchise, or the
Company or any Material Subsidiary suffers the imposition of any
restraining order, escrow, suspension or impound of funds in
connection with any proceeding (judicial or administrative) with
respect to any material license, permit or franchise, the effect of
which has or would reasonably be expected to have a Material Adverse
Effect.
Section 9.Further Assurances. The Guarantor agrees that at any
time and from time to time, at the expense of the Guarantor, the
Guarantor will promptly execute and deliver all further instruments
and documents, and take all further action, that may be necessary or
desirable, or that the Administrative Agent may reasonably request, to
enable the Administrative Agent to protect and to exercise and enforce
its rights and remedies hereunder.
Section 10.Application of Payments. Any payment received by the
Administrative Agent from the Guarantor (or from any Bank pursuant to
Section 15 below), shall be applied by the Administrative Agent as
follows:
First, to the payment of costs and expenses of collection
and all expenses (including without limitation Attorney Costs),
liabilities and advances made or incurred by the Administrative Agent
in connection therewith;
Next, to the Banks pro rata, based on the then outstanding
amount of the Obligations owed to each in payment in full of the
Obligations; and
Finally, after payment in full of all Obligations and the
termination of the Commitments, the payment to the Guarantor, or its
successors and assigns, or to whomsoever may be lawfully entitled to
receive the same or as a court of competent jurisdiction may direct,
of any surplus then remaining from such proceeds.
Section 11.Decisions Relating to Exercise of Remedies.
Notwithstanding anything in this Guaranty to the contrary, the
Administrative Agent may exercise, and at the request of the Majority
Banks shall exercise or refrain from exercising, all rights and
remedies provided for herein and provided by law.
Section 12.No Waiver. No failure on the part of the
Administrative Agent or any Bank to exercise, and no delay in
exercising, any right hereunder shall operate as a waiver thereof; nor
shall any single or partial exercise of any right hereunder preclude
any other or further exercise thereof or the exercise of any other
right. The remedies herein provided are cumulative and not exclusive
of any remedies provided by law.
Section 13.Amendments, Etc. No amendment or waiver of any
provision of this Guaranty, nor consent to any departure by the
Guarantor herefrom, shall in any event be effective unless the same
shall be in writing and signed, in the case of amendments, by the
Guarantor and by the Administrative Agent and, in the case of consent
or waivers, by the Administrative Agent and then such amendment,
waiver or consent shall be effective only in the specific instance and
for the specific purpose for which made or given.
Section 14.Notices. All notices, requests and other
communications provided for hereunder shall be in writing and given as
provided in Section 10.02 of the Credit Agreement. The address for
notices to Guarantor shall be the address set forth below its
signature to this Guaranty, or such other address as shall be
designated by Guarantor in a written notice to the Administrative
Agent
Section 15.Right to Set-off.
(a) Upon the occurrence and during the continuance of any
Event of Default under the Credit Agreement, each Bank is hereby
authorized at any time and from time to time, to the fullest extent
permitted by law, to set-off and apply any and all deposits (general
or special, time or demand, provisional or final) at any time held and
other indebtedness at any time owing by such Bank to or for the credit
or the account of the Guarantor against any and all of the
Obligations, irrespective of whether or not such Bank shall have made
any demand under this Guaranty and although such Obligations may be
contingent and unmatured. Each Bank which sets-off pursuant to this
Section 15(a) shall give prompt notice to the Guarantor and the
Administrative Agent following the occurrence thereof; provided that
the failure to give such notice shall not affect the validity of the
set-off.
(b) Any payment obtained pursuant to Section 15(a) above
(or in any other manner directly from the Guarantor) by any Bank shall
be remitted to the Administrative Agent and distributed among the
Banks in accordance with the provisions of Section 10 above.
Section 16.Continuing Guaranty. This Guaranty is a continuing
guaranty and shall (a) remain in full force and effect until the
indefeasible payment in full (after the termination of the
Commitments) of the Obligations and all other amounts payable under
this Guaranty; (b) be binding upon the Guarantor, its successors and
assigns; and (c) inure to the benefit of the Administrative Agent, the
Banks and their respective successors, transferees and assigns.
Without limiting the generality of the foregoing clause (c), any Bank
may assign or otherwise transfer its rights and obligations under the
Credit Agreement to any other Person or entity, and such other Person
or entity shall thereupon become vested with all the benefits in
respect thereof granted to the Banks herein or otherwise, all as
provided in, and to the extent set forth in, Sections 10.07 and 10.08
of the Credit Agreement. Notwithstanding anything in this Guaranty to
the contrary, this Guaranty shall terminate as to any principal
advances made after the last Maturity Date for Committed Loans
consented to in writing by the Guarantor in the event that (i) the
Guarantor is not a partner in the Borrower on such Maturity Date, (ii)
Guarantor shall have given written notice to the Administrative Agent
and the Banks at least 30 days prior to the Maturity Date of
Guarantor's ceasing to be a partner in the Borrower, and (iii) the
Commitments shall have been extended beyond the Maturity Date by
written extension agreement entered into between the Borrower and the
Banks without Guarantor's written consent to such extension; provided,
that this Guaranty shall continue in full force and effect as to all
other Obligations guaranteed hereunder.
Section 17.Subordination of the Credit Parties' Obligations to
the Guarantor. The Guarantor hereby expressly covenants and agrees
for the benefit of the Administrative Agent and the Banks that all
obligations and liabilities of the Borrower and all obligations and
liabilities of all other guarantors of the Obligations (or any part
thereof) ("Other Guarantors") to the Guarantor of whatsoever
description (including, without limitation, all rights of contribution
(the "Subordinated Obligations") shall be subordinated and junior in
right of payment to the prior payment in full in cash of the
Obligations (including, without limitation, interest on the
Obligations accrued subsequent to the commencement of an Insolvency
Proceeding and all interest that would have accrued but for the
commencement of such Insolvency Proceeding). In the case of any
Insolvency Proceeding wherein the obligor of Subordinated Obligations
(an "Obligor") is debtor, the Obligor and any assignee, trustee in
bankruptcy, receiver or other similar Person, debtor in possession or
other Person(s) in charge are hereby directed to pay to the
Administrative Agent (for the benefit of the Banks) the full amount of
the Obligations (including interest to date of payment and including
without limitation interest after the filing of a petition initiating
an Insolvency Proceeding) before making any payment in respect of the
Subordinated Obligations to the Guarantor, and insofar as may be
necessary for that purpose, the Guarantor hereby assigns and transfers
to the Administrative Agent all rights to such payments.
Notwithstanding the foregoing provisions of this Section 17:
(a) with respect to obligations and liabilities of the
Borrower to the Guarantor ("Borrower/Guarantor Obligations"), the
Guarantor may receive payments in respect of Borrower/Guarantor
Obligations so long as there has not occurred a Default or Event of
Default;
(b) with respect to obligations and liabilities of one or
more of the Other Guarantors which obligations or liabilities are
related to the Borrower or the Guarantor's interest in the Borrower
("Borrower Related Inter-Guarantor Obligations") the Guarantor may
receive scheduled payments in respect of Borrower Related
Inter-Guarantor Obligations in accordance with the terms thereof so
long as there has been no acceleration of the Obligations under the
Credit Agreement and there is not pending any Insolvency Proceeding
involving as debtor the Borrower or the Obligor of the Borrower
Related Inter-Guarantor Obligations; and
(c) with respect to obligations and liabilities of one or
more of the Other Guarantors which obligations or liabilities are
unrelated to the Borrower or the Guarantor's interest in the Borrower
("Unrelated Inter-Guarantor Obligations"), the Guarantor may receive
payments in respect of the Unrelated Inter-Guarantor Obligations so
long as there is not pending any Insolvency Proceeding involving as
debtor the Obligor of the Unrelated Inter-Guarantor Obligations.
If the Guarantor shall receive any payment in respect of the
Subordinated Obligations in contravention of the terms of this
Section, such payments shall be collected and received by the
Guarantor as trustee for the Administrative Agent and the Banks and
paid over to the Administrative Agent and the Banks on account of the
Obligations.
Section 18.Severability. If for any reason any provision or
provisions hereof are determined to be invalid and contrary to any
existing or future law, such invalidity shall not impair the operation
of or affect those portions of this Guaranty which are valid.
Section 19.Taxes.
(a) Any and all payments by the Guarantor to each Bank or
the Administrative Agent under this Guaranty and any other Loan
Document shall be made free and clear of, and without deduction or
withholding for, any Taxes. In addition, the Guarantor shall pay all
Other Taxes.
(b) If Guarantor shall be required by law to deduct or
withhold any Taxes, Other Taxes or Further Taxes from or in respect of
any sum payable hereunder to any Bank or the Administrative Agent,
then: (i) the sum payable shall be increased as necessary so that
after making all required deductions and withholdings (including
deductions and withholdings applicable to additional sums payable
under this Section) such Bank or the Administrative Agent, as the case
may be, receives an amount equal to the sum it would have received had
no such deductions or withholdings been made; (ii) the Guarantor shall
make such deductions and withholdings; (iii) the Guarantor shall pay
the full amount deducted or withheld to the relevant taxing authority
or other authority in accordance with applicable law; and (iv) the
Guarantor shall also pay to each Bank or the Administrative Agent for
the account of such Bank, at the time interest is paid, all additional
reasonable amounts which the respective Bank specifies as necessary to
preserve the after-tax yield the Bank would have received if such
Taxes, Other Taxes or Further Taxes had not been imposed.
(c) The Guarantor agrees to indemnify and hold harmless
each Bank and the Administrative Agent for the full amount of Taxes,
Other Taxes and Further Taxes in the amount that the respective Bank
specifies as necessary to preserve the after-tax yield the Bank would
have received if such Taxes, Other Taxes or Further Taxes had not been
imposed, and any liability (including penalties, interest, additions
to tax and expenses) arising therefrom or with respect thereto,
whether or not such Taxes, Other Taxes or Further Taxes were correctly
or legally asserted. Payment under this indemnification shall be made
within 30 days after the date the Bank or the Administrative Agent
makes written demand therefor.
(d) Within 30 days after the date of any payment by the
Guarantor of Taxes, Other Taxes or Further Taxes, the Guarantor shall
furnish to the Administrative Agent and each Bank the original or a
certified copy of a receipt evidencing payment thereof, or other
evidence of payment reasonably satisfactory to the Administrative
Agent.
SECTION 20. No Bankruptcy Proceedings. Guarantor agrees that
it will not institute against any Committed Loan Designated Lender or
join any other Person in instituting against any Committed Loan
Designated Lender any bankruptcy, reorganization, arrangement,
insolvency or liquidation proceeding under any federal or state
bankruptcy or similar law, for one year and one day after the payment
in full of the latest maturing commercial paper note issued by such
Committed Loan Designated Lender; provided, that the respective
Committed Loan Designating Lender hereby agrees to indemnify, save and
hold harmless the Guarantor for any loss, cost, damage and expense
arising out of their inability to institute any such proceeding
against its Committed Loan Designated Lender.
SECTION 21. GOVERNING LAW AND JURISDICTION.
(a) THIS GUARANTY SHALL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK (WITHOUT REGARD TO
PRINCIPLES OF CONFLICTS OF LAWS); PROVIDED THAT THE ADMINISTRATIVE
AGENT AND THE BANKS SHALL RETAIN ALL RIGHTS ARISING UNDER FEDERAL LAW.
(b) ANY LEGAL ACTION OR PROCEEDING WITH RESPECT TO THIS
GUARANTY OR ANY OTHER LOAN DOCUMENT MAY BE BROUGHT IN THE COURTS OF
THE STATE OF NEW YORK OR OF THE UNITED STATES FOR THE SOUTHERN
DISTRICT OF NEW YORK, AND BY EXECUTION AND DELIVERY OF THIS GUARANTY,
THE GUARANTOR CONSENTS, FOR ITSELF AND IN RESPECT OF ITS PROPERTY, TO
THE NON-EXCLUSIVE JURISDICTION OF THOSE COURTS. THE GUARANTOR HEREBY
IRREVOCABLY DESIGNATES, APPOINTS AND EMPOWERS CT CORPORATION SYSTEM,
WITH OFFICES ON THE DATE HEREOF AT 1633 BROADWAY, NEW YORK, NEW YORK
10019, AS ITS DESIGNEE, APPOINTEE AND REGISTERED AGENT TO RECEIVE,
ACCEPT AND ACKNOWLEDGE FOR AND ON ITS BEHALF, AND IN RESPECT OF ITS
PROPERTY, SERVICE OF ANY AND ALL LEGAL PROCESS, SUMMONS, NOTICES AND
DOCUMENTS WHICH MAY BE SERVED IN ANY SUCH ACTION OR PROCEEDING. IF
FOR ANY REASON SUCH DESIGNEE, APPOINTEE AND REGISTERED AGENT SHALL
CEASE TO BE AVAILABLE TO ACT AS SUCH, THE GUARANTOR AGREES TO
DESIGNATE A NEW DESIGNEE, APPOINTEE AND REGISTERED AGENT IN NEW YORK
ON THE TERMS AND FOR THE PURPOSES OF THIS PROVISION SATISFACTORY TO
THE ADMINISTRATIVE AGENT. TO THE EXTENT PERMITTED BY APPLICABLE LAW,
THE GUARANTOR FURTHER IRREVOCABLY CONSENTS TO THE SERVICE OF PROCESS
OUT OF ANY OF THE AFOREMENTIONED COURTS IN ANY SUCH ACTION OR
PROCEEDING BY THE MAILING OF COPIES THEREOF BY REGISTERED OR CERTIFIED
MAIL, POSTAGE PREPAID, TO IT AT ITS ADDRESS SET FORTH BELOW ITS
SIGNATURE TO THIS GUARANTY. NOTHING HEREIN SHALL AFFECT THE RIGHT OF
THE ADMINISTRATIVE AGENT OR ANY BANK TO SERVE PROCESS IN ANY OTHER
MANNER PERMITTED BY LAW OR TO COMMENCE LEGAL PROCEEDINGS OR OTHERWISE
PROCEED AGAINST THE GUARANTOR IN ANY OTHER JURISDICTION. THE
GUARANTOR WAIVES PERSONAL SERVICE OF ANY SUMMONS, COMPLAINT OR OTHER
PROCESS, WHICH MAY BE MADE BY ANY OTHER MEANS PERMITTED BY NEW YORK
LAW.
(c) THE GUARANTOR IRREVOCABLY WAIVES ANY OBJECTION,
INCLUDING ANY OBJECTION TO THE LAYING OF VENUE OR BASED ON THE GROUNDS
OF FORUM NON CONVENIENS, WHICH IT MAY NOW OR HEREAFTER HAVE TO THE
BRINGING OF ANY ACTION OR PROCEEDING IN SUCH JURISDICTION IN RESPECT
OF THIS GUARANTY OR ANY DOCUMENT RELATED HERETO.
SECTION 22. WAIVER OF JURY TRIAL. THE GUARANTOR WAIVES ITS
RIGHTS TO A TRIAL BY JURY OF ANY CLAIM OR CAUSE OF ACTION BASED UPON
OR ARISING OUT OF OR RELATED TO THIS GUARANTY, THE OTHER LOAN
DOCUMENTS, OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY, IN ANY
ACTION, PROCEEDING OR OTHER LITIGATION OF ANY TYPE BROUGHT BY ANY OF
THE PARTIES AGAINST ANY OTHER PARTY OR ANY AGENT-RELATED PERSON,
PARTICIPANT OR ASSIGNEE, WHETHER WITH RESPECT TO CONTRACT CLAIMS, TORT
CLAIMS, OR OTHERWISE. THE GUARANTOR AGREES THAT ANY SUCH CLAIM OR
CAUSE OF ACTION SHALL BE TRIED BY A COURT TRIAL WITHOUT A JURY.
WITHOUT LIMITING THE FOREGOING, THE GUARANTOR FURTHER AGREES THAT ITS
RIGHT TO A TRIAL BY JURY IS WAIVED BY OPERATION OF THIS SECTION AS TO
ANY ACTION, COUNTERCLAIM OR OTHER PROCEEDING WHICH SEEKS, IN WHOLE OR
IN PART, TO CHALLENGE THE VALIDITY OR ENFORCEABILITY OF THIS GUARANTY
OR THE OTHER LOAN DOCUMENTS OR ANY PROVISION HEREOF OR THEREOF. THIS
WAIVER SHALL APPLY TO ANY SUBSEQUENT AMENDMENTS, RENEWALS, SUPPLEMENTS
OR MODIFICATIONS TO THIS GUARANTY AND THE OTHER LOAN DOCUMENTS.
Section 23.ENTIRE AGREEMENT. THIS WRITTEN GUARANTY AND THE
INSTRUMENTS AND DOCUMENTS EXECUTED IN CONNECTION HEREWITH, REPRESENT
THE FINAL AGREEMENT BETWEEN THE PARTIES AND MAY NOT BE CONTRADICTED BY
EVIDENCE OF PRIOR, CONTEMPORANEOUS, OR SUBSEQUENT ORAL AGREEMENTS OF
THE PARTIES.
THERE ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN THE PARTIES.
[THE SIGNATURE IS ON THE NEXT PAGE]
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IN WITNESS WHEREOF, the Guarantor has caused this Guaranty to be
duly executed and delivered by its officer thereunto duly authorized
as of the date first above written.
QUESTAR PIPELINE CO.
By
Name:
Title:
Address for Notices:
[THIS IS THE SIGNATURE PAGE
TO THE GUARANTY AGREEMENT]
SCHEDULE 1
To Guaranty Agreement
Definitions
"Affiliate" means, as to any Person, any other Person which,
directly or indirectly, is in control of, is controlled by, or is
under common control with, such Person. A Person shall be deemed to
control another Person if the controlling Person possesses, directly
or indirectly, the power to direct or cause the direction of the
management and policies of the other Person, whether through the
ownership of voting securities, by contract, or otherwise.
"Attributable Debt" means, as of the date of determination, the
present value of net rent for the remaining term of a capital lease,
determined in accordance with GAAP, which is part of a Sale and
Leaseback Transaction, including any periods for which the lessee has
the right to renew or extend the lease. For purposes of the
foregoing, "net rent" means the sum of capitalized rental payments
required to be paid by the lessee, other than amounts required to be
paid by the lessee for maintenance, repairs, insurance, taxes,
assessments, energy, fuel, utilities and similar charges. In the case
of a capital lease which is terminable by the lessee upon the payment
of a penalty, such net amount shall also include the amount of such
penalty, but no rent shall be considered to be required to be paid
under such lease subsequent to the first date upon which it may be so
terminated.
"Change of Control" means (i) any person or two or more persons
acting in concert shall acquire beneficial ownership, directly or
indirectly, of securities of the Guarantor (or other securities
convertible into such securities) representing 30% or more of the
combined voting power of all securities of the Guarantor entitled to
vote in the election of directors; or (ii) during any period of up to
12 consecutive months, commencing after the Closing Date, individuals
who at the beginning of such 12-month period were directors of the
Guarantor shall cease for any reason to constitute a majority of the
Board of Directors of the Guarantor unless the persons replacing such
individuals were nominated by the Board of Directors of the Guarantor;
or (iii) any person or two or more persons acting in concert acquiring
by contract or otherwise, or entering into a contract or arrangement
which upon consummation will result in its or their acquisition of, or
control over, securities of the Guarantor (or other securities
convertible into such securities) representing 30% or more of the
combined voting power of all securities of the Guarantor entitled to
vote in the election of directors.
"Code" means the Internal Revenue Code of 1986, and regulations
promulgated thereunder.
"Compliance Certificate" means a certificate substantially in the
form of Exhibit A.
"Consolidated Capitalization" means, without duplication, the sum
of (a) the principal amount of Consolidated Funded Debt of the
Guarantor and its Subsidiaries at the time outstanding, (b) the total
capital represented by the capital stock of the Guarantor and its
Subsidiaries at the time outstanding, based, in the case of stock
having par value, upon its par value, and in the case of stock having
no par value, upon the value stated on the books of the Guarantor, (c)
the total amount of (or less the amount of any deficit in) retained
earnings and paid-in capital of the Guarantor and its Subsidiaries,
(d) reserves for deferred federal and state income taxes arising from
timing differences, and (e) Attributable Debt, all as shown on a
consolidated balance sheet of the Guarantor and its Subsidiaries
prepared in accordance with GAAP; provided that in determining the
consolidated retained earnings and paid-in capital of the Guarantor
and its Subsidiaries no effect shall be given to any unrealized
write-up or write-down in the value of assets or any amortization
thereof, except for accumulated provisions for depreciation,
depletion, amortization and property retirement which shall have been
created by charges made by the Guarantor or any of its Subsidiaries on
its books.
"Consolidated Funded Debt" means the Funded Debt of the Guarantor
and its Subsidiaries, consolidated in accordance with GAAP.
"Contingent Obligation" means, as to any Person, any direct or
indirect liability of that Person, whether or not contingent, with or
without recourse, (a) with respect to any Indebtedness, lease,
dividend, letter of credit or other obligation (the "primary
obligations") of another Person (the "primary obligor"), including any
obligation of that Person (i) to purchase, repurchase or otherwise
acquire such primary obligations or any security therefor, (ii) to
advance or provide funds for the payment or discharge of any such
primary obligation, or to maintain working capital or equity capital
of the primary obliger or otherwise to maintain the net worth or
solvency or any balance sheet item, level of income or financial
condition of the primary obliger, (iii) to purchase property,
securities or services primarily for the purpose of assuring the owner
of any such primary obligation of the ability of the primary obligor
to make payment of such primary obligation, or (iv) otherwise to
assure or hold harmless the holder of any such primary obligation
against loss in respect thereof (each, a "Guaranty Obligation"); (b)
with respect to any Surety Instrument issued for the account of that
Person or as to which that Person is otherwise liable for
reimbursement of drawings or payments; (c) to purchase any materials,
supplies or other property from, or to obtain the services of, another
Person if the relevant contract or other related document or
obligation requires that payment for such materials, supplies or other
property, or for such services, shall be made regardless of whether
delivery of such materials, supplies or other property is ever made or
tendered, or such services are ever performed or tendered, or (d) in
respect of any Swap Contract.
"Contractual Obligation" means, as to any Person, any provision
of any security issued by such Person or of any agreement,
undertaking, contract, indenture, mortgage, deed of trust or other
instrument, document or agreement to which such Person is a party or
by which it or any of its property is bound.
"Default" means any event or circumstance which, with the giving
of notice, the lapse of time, or both, would (if not cured or
otherwise remedied during such time) constitute an Event of Default.
"Environmental Claims" means all claims, however asserted, by any
Governmental Authority or other Person alleging potential liability or
responsibility for violation of any Environmental Law, or for release
or injury to the environment.
"Environmental Laws" means all federal, state or local laws,
statutes, common law duties, rules, regulations, ordinances and codes,
together with all administrative orders, directed duties, requests,
licenses, authorizations and permits of, and agreements with, any
Governmental Authorities, in each case relating to environmental,
health, safety and land use matters.
"ERISA" means the Employee Retirement Income Security Act of
1974, and regulations promulgated thereunder.
"ERISA Affiliate" means any trade or business (whether or not
incorporated) under common control with the Guarantor within the
meaning of Section 414(b) or (c) of the Code (and Sections 414(m) and
(o) of the Code for purposes of provisions relating to Section 412 of
the Code).
"ERISA Event" means (a) a Reportable Event with respect to a
Pension Plan; (b) a withdrawal by the Company or any ERISA Affiliate
from a Pension Plan subject to Section 4063 of ERISA during a plan
year in which it was a substantial employer (as defined in Section
4001(a)(2) of ERISA) or a cessation of operations which is treated as
such a withdrawal under Section 4062(e) of ERISA; (c) a complete or
partial withdrawal by the Company or any ERISA Affiliate from a
Multiemployer Plan or notification that a Multiemployer Plan is in
reorganization; (d) the filing of a notice of intent to terminate, the
treatment of a Plan amendment as a termination under Section 4041 or
4041A of ERISA, or the commencement of proceedings by the PBGC to
terminate a Pension Plan or Multiemployer Plan; (e) an event or
condition which might reasonably be expected to constitute grounds
under Section 4042 of ERISA for the termination of, or the appointment
of a trustee to administer, any Pension Plan or Multiemployer Plan; or
(f) the imposition of any liability under Title IV of ERISA, other
than PBGC premiums due but not delinquent under Section 4007 of ERISA,
upon the Guarantor or any ERISA Affiliate.
"Event of Default" means any of the events or circumstances
specified in Section 8.
"FRB" means the Board of Governors of the Federal Reserve System,
and any Governmental Authority succeeding to any of its principal
functions.
"Funded Debt" means all Indebtedness that will mature, pursuant
to a mandatory sinking fund or prepayment provision or otherwise, and
all installments of Indebtedness that will fall due, more than one
year from the date of determination. In calculating the maturity of
any Indebtedness, there shall be included the term of any unexercised
right of the debtor to renew or extend such Indebtedness existing at
the time of determination.
"GAAP" means generally accepted accounting principles set forth
from time to time in the opinions and pronouncements of the Accounting
Principles Board and the American Institute of Certified Public
Accountants and statements and pronouncements of the Financial
Accounting Standards Board (or agencies with similar functions of
comparable stature and authority within the U.S. accounting
profession), which are applicable to the circumstances as of the date
of determination.
"Governmental Authority" means any nation or government, any
state or other political subdivision thereof, any central bank (or
similar monetary or regulatory authority) thereof, any entity
exercising executive, legislative, judicial, regulatory or
administrative functions of or pertaining to government, and any
corporation or other entity owned or controlled, through stock or
capital ownership or otherwise, by any of the foregoing.
"Guaranty Obligation" has the meaning specified in the definition
of "Contingent Obligation. "
"Indebtedness" means all items of indebtedness for borrowed money
(other than unamortized debt discount and premium) which would be
included in determining total liabilities as shown on the liability
side of a balance sheet prepared in accordance with GAAP as of the
date as of which Indebtedness is to be determined, and shall include
indebtedness for borrowed money (other than unamortized debt discount
and premium) with respect to which the Guarantor or any Subsidiary
customarily pays interest secured by any mortgage, pledge, or other
lien or encumbrance of or upon, or any security interest in , any
properties or assets owned by the Guarantor or any Subsidiary, whether
or not the Indebtedness secured thereby shall have been assumed, and
shall also include guarantees of Indebtedness of others; provided,
that in determining Indebtedness of the Guarantor or any Subsidiary
there shall be included the aggregate liquidation preference of all
outstanding securities of any subsidiary senior to its Common Stock
that are not owned by the Guarantor or Subsidiary, and provided,
further, that Indebtedness of any Person shall not include the
following:
(a) any indebtedness evidence of which is held in treasury (but
the subsequent resale of such indebtedness shall be deemed to
constitute the creation thereof); or
(b) any particular indebtedness if, upon or prior to the
maturity thereof, there shall have been deposited with a depository
(or set aside and segregated, if permitted by the instrument creating
such indebtedness), in trust, money (or evidence of such indebtedness
as permitted by the instrument creating such indebtedness) in the
necessary amount to pay, redeem or satisfy such indebtedness; or
(c) any indebtedness incurred to finance oil, natural gas,
hydrocarbon, inert gas or other mineral exploration or development to
the extent that the issuer thereof has outstanding advances to finance
oil, natural gas, hydrocarbon, inert gas or other mineral exploration
or development, but only to the extent such advances are not in
default; or
(d) any indebtedness incurred without recourse to the
Guarantor or any Subsidiary; or
(e) any indebtedness incurred to finance advance payments for
gas (pursuant to take-or-pay provisions or otherwise), but only to the
extent that such advance payments are pursuant to gas purchase
contracts entered into in the normal course of business; or
(f) any amount (whether or not included in determining
total liabilities as shown on the liability side of a balance sheet
prepared in accordance with GAAP) representing capitalized rent under
any lease; or
(g) any indirect guarantees or other contingent obligations in
respect of indebtedness of other Persons, including agreements,
contingent or otherwise, with such other Persons or with third parties
with respect to, or to permit or assure the payment of, obligations of
such other Persons including, without limitation, agreements to
purchase or repurchase obligations of such other Persons, to advance
or supply funds to, or to invest in, such other Persons, or to pay for
property, products or services of such other Persons (whether or not
conveyed, delivered or rendered); demand charge contracts,
through-put, take-or-pay, keep-well, make-whole or maintenance of
working capital or similar agreements; or guarantees with respect to
rental or similar periodic payments to be made by such other Persons.
"Independent Auditor" has the meaning specified in subsection
7(a)(i).
"IRS" means the Internal Revenue Service, and any Governmental
Authority succeeding to any of its principal functions under the Code.
"Lien" means any security interest, mortgage, deed of trust,
pledge, hypothecation, assignment, charge or deposit arrangement,
encumbrance, lien (statutory or other) or preferential arrangement of
any kind or nature whatsoever in respect of any property (including
those created by, arising under or evidenced by any conditional sale
or other title retention agreement, the interest of a lessor under a
capital lease, any financing lease having substantially the same
economic effect as any of the foregoing, or the filing of any
financing statement naming the owner of the asset to which such lien
relates as debtor, under the Uniform Commercial Code or any comparable
law) and any contingent or other agreement to provide any of the
foregoing, but not including the interest of a lessor under an
operating lease.
"Material Subsidiary" means (i) Questar TransColorado, Inc., a
Utah corporation, and (ii) any Subsidiary the consolidated assets of
which constitute 10% or more of the consolidated assets of the
Guarantor and its Subsidiaries, and, in each instance, their
respective successors and assigns.
"Multiemployer Plan" means a "multiemployer plan", within the
meaning of Section 4001(a)(3) of ERISA, to which the Guarantor or any
ERISA Affiliate makes, is making, or is obligated to make
contributions or, during the preceding three calendar years, has made.
or been obligated to make, contributions.
"Organization Documents" means, for any corporation, the
certificate or articles of incorporation, the bylaws, any certificate
of determination or instrument relating to the rights of preferred
shareholders of such corporation, any shareholder rights agreement,
and all applicable resolutions of the board of directors (or any
committee thereof) of such corporation.
"PBGC" means the Pension Benefit Guaranty Corporation, and any
Governmental Authority succeeding to any of its principal functions
under ERISA.
"Pension Plan" means a pension plan (as defined in Section 3(2)
of ERISA) subject to Title IV of ERISA which the Guarantor sponsors,
maintains, or to which it makes, is making, or is obligated to make
contributions, or in the case of a multiple employer plan (as
described in Section 4064(a) of ERISA) has made contributions at any
time during the immediately preceding five (5) plan years.
"Permitted Liens" has the meaning specified in Section 7(l).
"Person" means an individual, partnership, corporation, business
trust, joint stock company, trust, unincorporated association, joint
venture or Governmental Authority.
"Plan" means an employee benefit plan (as defined in Section 3(3)
of ERISA) which the Guarantor sponsors or maintains or to which the
Guarantor makes, is making, or is obligated to make contributions and
includes any Pension Plan.
"Reportable Event'' means, any of the events set forth in Section
4043(b) of ERISA or the regulations thereunder, other than any such
event for which the 30-day notice requirement under ERISA has been
waived in regulations issued by the PBGC.
"Requirement of Law" means, as to any Person, any law (statutory
or common), treaty, rule or regulation or determination of an
arbitrator or of a Governmental Authority, in each case applicable to
or binding upon the Person or any of its property or to which the
Person or any of its property is subject.
"Responsible Officer" the chief executive officer or the
president of the Guarantor, or any other officer having substantially
the same authority and responsibility; or, with respect to compliance
with financial covenants, the chief financial officer or the treasurer
of the Guarantor, or any other officer having substantially the same
authority and responsibility.
"Sale and Leaseback Transaction" means an arrangement in which
the Guarantor or a Subsidiary sells any of its property which was
placed into service more than 120 days prior to such sale to a Person
and leases it back from that Person within 180 days of the sale.
"SEC" means the Securities and Exchange Commission, and any
Governmental Authority succeeding to any of its principal functions.
"Subsidiary" of a Person means any corporation, association,
partnership, joint venture or other business entity of which more than
50% of the voting stock or other equity interests (in the case of
Persons other than corporations), is owned or controlled directly or
indirectly by the Person, or one or more of the Subsidiaries of the
Person, or a combination thereof. Unless the context otherwise clearly
requires, references herein to a "Subsidiary" refer to a Subsidiary of
the Guarantor.
"Surety Instruments" means all letters of credit (including
standby and commercial), banker's acceptances, bank guaranties, surety
bonds and similar instruments.
"Swap Contract" means any agreement (including any master
agreement and any agreement, whether or not in writing, relating to
any single transaction) that is an interest rate swap agreement, basis
swap, forward rate agreement, commodity swap, commodity option, equity
or equity index swap or option, bond option, interest rate option,
forward foreign exchange agreement, rate cap, collar or floor
agreement, currency swap agreement, cross-currency rate swap
agreement, swap option, currency option or any other, similar
agreement (including any option to enter into any of the foregoing).
"Tangible Net Worth" means the gross book value of the assets of
the Guarantor and its Subsidiaries on a consolidated basis (exclusive
of goodwill, patents, trademarks, trade names, organization expense,
treasury stock, unamortized debt discount and expense, deferred
charges, and other like intangibles) less (a) reserve applicable
thereto, and (b) all liabilities (including accrued and deferred
income taxes).
"Unfunded Pension Liability" means the excess of a Plan's benefit
liabilities under Section 4001(a)(16) of ERISA, over the current value
of that Plan's assets, determined in accordance with the assumptions
used for funding the Pension Plan pursuant to Section 412 of the Code
for the applicable plan year.
Other Interpretive Provisions. (a) The meanings of defined terms
are equally applicable to the singular and plural forms of the defined
terms.
(b) The words "hereof", "herein", "hereunder" and similar
words refer to this Guaranty as a whole and not to any particular
provision of this Guaranty; and subsection, Section, Schedule and
Exhibit references are to this Guaranty unless otherwise specified.
(c) (i) The term "documents" includes any and all
instruments, documents, agreements, certificates, indentures, notices
and other writings, however evidenced; (ii) the term "including" is
not limiting and means "including without limitation"; and (iii) in
the computation of periods of time from a specified date to a later
specified date, the word "from" means "from and including"; the words
"to" and "until" each mean "to but excluding, and the word "through"
means "to and including."
(d) Unless otherwise expressly provided herein, (i)
references to agreements (including this Guaranty) and other
contractual instruments shall be deemed to include all subsequent
amendments and other modifications thereto, but only to the extent
such amendments and other modifications are not prohibited by the
terms of any Loan Document, and (ii) references to any statute or
regulation are to be construed as including all statutory and
regulatory provisions consolidating, amending, replacing,
supplementing or interpreting the statute or regulation.
(e) The captions and headings of this Guaranty are for
convenience of reference only and shall not affect the interpretation
of this Guaranty.
(f) This Guaranty and other Loan Documents may use several
different limitations, tests or measurements to regulate the same or
similar matters. All such limitations, tests and measurements are
cumulative and shall each be performed in accordance with their terms.
(g) This Guaranty and the other Loan Documents are the
result of negotiations between and have been reviewed by the
respective counsel to the Administrative Agent, the Banks and the
Company, and are the products of both parties. Accordingly, they shall
not be construed against the Administrative Agent or any Bank merely
because of their involvement in their preparation.
Accounting Principles. (a) Unless the context otherwise clearly
requires, all accounting terms not expressly defined herein shall be
construed, and all financial computations required under this Guaranty
shall be made, in accordance with GAAP, consistently applied.
(b) References herein to "fiscal year" and "fiscal quarter"
refer to such fiscal periods of the Guarantor.
SCHEDULE 6(o)
To Guaranty Agreement
(a) Subsidiaries
1. Questar TransColorado, Inc.
2. Questar Line 90 Company
(b) Investments
Questar Pipeline Company, Guarantor, owns a 54% interest in the
Overthrust Pipeline Partnership.
SCHEDULE 6(a)
To Guaranty Agreement
Qualification to do Business as a Foreign Corporation
Questar TransColorado, Inc., a Wholly-Owned Subsidiary of Guarantor,
will file its Application for Certificate of Authority to do business
as a foreign corporation in New Mexico on or before October 15, 1998
and will ask for expedited treatment of its application. It expects
to have its application approved prior to November 15, 1998.
Guarantor represents and warrants that the failure of Questar
Transcolorado, Inc. to qualify to do business as a foreign corporation
in New Mexico can not reasonably be expected to have a Material
Adverse Effect.
SCHEDULE 7(l)
To Guaranty Agreement
Liens
None
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