EXHIBIT 10.32
- --------------------------------------------------------------------------------
BURLINGTON RESOURCES CANADA LTD.
BURLINGTON RESOURCES INC.
----------
Cdn.$471,420,000
CANADIAN CREDIT AGREEMENT
Dated as of March 31, 2000,
as Amended and Restated as of December 7, 2001
----------
J.P. MORGAN BANK CANADA,
as Administrative Agent
CITIBANK CANADA
FLEET NATIONAL BANK,
as Co-Syndication Agents
BANK OF AMERICA CANADA
THE TORONTO-DOMINION BANK,
as Co-Documentation Agents
- --------------------------------------------------------------------------------
TABLE OF CONTENTS
<Table>
<Caption>
PAGE
----
ARTICLE 1
DEFINITIONS AND ACCOUNTING TERMS
Section 1.01. Certain Defined Terms......................................................................1
Section 1.02. Computation of Time Periods...............................................................18
Section 1.03. Accounting and Other Terms................................................................18
Section 1.04. References................................................................................18
Section 1.05. Schedule III Banks........................................................................18
ARTICLE 2
AMOUNTS AND TERMS OF THE ADVANCES
Section 2.01. Revolving Advances........................................................................18
Section 2.02. Making the Advances.......................................................................19
Section 2.03. Fees......................................................................................21
Section 2.04. Reduction of the Commitments..............................................................22
Section 2.05. Repayment of Advances.....................................................................22
Section 2.06. Interest on Advances......................................................................22
Section 2.07. [Intentionally omitted]...................................................................25
Section 2.08. Rate Determination........................................................................25
Section 2.09. Voluntary Continuation of Advances........................................................27
Section 2.10. Prepayments...............................................................................27
Section 2.11. Bankers' Acceptances......................................................................28
Section 2.12. Increased Costs...........................................................................31
Section 2.13. Increased Capital.........................................................................32
Section 2.14. Illegality................................................................................32
Section 2.15. Payments and Computations.................................................................33
Section 2.16. Taxes.....................................................................................34
Section 2.17. Sharing of Payments, Etc..................................................................38
Section 2.18. Evidence of Debt..........................................................................38
Section 2.19. Use of Proceeds...........................................................................39
Section 2.20. Increase of Commitments...................................................................39
Section 2.21. Extension of Revolving Commitment Termination Date........................................41
Section 2.22. Replacement of Lenders....................................................................42
Section 2.23. Currency Indemnity........................................................................43
Section 2.24. Exchange Rate Calculations................................................................43
ARTICLE 3
CONDITIONS OF EFFECTIVENESS AND LENDING
Section 3.01. Conditions Precedent to Effectiveness of this Agreement...................................44
Section 3.02. Conditions Precedent to Each Borrowing....................................................45
ARTICLE 4
REPRESENTATIONS AND WARRANTIES
Section 4.01. Representations and Warranties of the Borrower............................................46
</Table>
i
TABLE OF CONTENTS
(continued)
<Table>
<Caption>
PAGE
----
ARTICLE 5
COVENANTS
Section 5.01. Affirmative Covenants.....................................................................48
Section 5.02. Negative Covenants........................................................................50
Section 5.03. Reporting Requirements....................................................................53
ARTICLE 6
EVENTS OF DEFAULT
Section 6.01. Events of Default.........................................................................55
ARTICLE 7
THE ADMINISTRATIVE AGENT
Section 7.01. Authorization and Action..................................................................58
Section 7.02. Administrative Agent's Reliance, Etc......................................................58
Section 7.03. Administrative Agent and Affiliates.......................................................59
Section 7.04. Lender Credit Decision....................................................................59
Section 7.05. Indemnification...........................................................................59
Section 7.06. Successor Administrative Agent............................................................60
ARTICLE 8
GUARANTY
ARTICLE 9
MISCELLANEOUS
Section 9.01. Amendments, Etc...........................................................................62
Section 9.02. Notices, Etc..............................................................................63
Section 9.03. No Waiver; Remedies.......................................................................64
Section 9.04. Costs and Expenses; Indemnity.............................................................64
Section 9.05. Right of Set-off..........................................................................65
Section 9.06. Binding Effect............................................................................65
Section 9.07. Assignments and Participations............................................................66
Section 9.08. Confidentiality...........................................................................68
Section 9.09. Consent to Jurisdiction...................................................................69
Section 9.10. Governing Law.............................................................................69
Section 9.11. Execution in Counterparts.................................................................69
Section 9.12. Waiver of Jury Trial......................................................................70
</Table>
ii
CANADIAN SHORT-TERM REVOLVING CREDIT AGREEMENT
Dated as of March 31, 2000,
as amended and restated as of December 7, 2001
BURLINGTON RESOURCES CANADA LTD., an Alberta corporation
(together with its permitted successors and assigns, the "BORROWER"), Burlington
Resources Inc., a Delaware corporation (together with its permitted successors
and assignees, the "PARENT"), the financial institutions (the "INITIAL LENDERS")
listed on the signature pages hereof, J.P. MORGAN BANK CANADA, as administrative
agent for the Lenders hereunder (in such capacity, the "ADMINISTRATIVE AGENT"),
CITIBANK CANADA and FLEET NATIONAL BANK, as co-syndication agents, and BANK OF
AMERICA CANADA and THE TORONTO-DOMINION BANK, as co-documentation agents, agree
as follows:
ARTICLE 1
DEFINITIONS AND ACCOUNTING TERMS
SECTION 1.01. CERTAIN DEFINED TERMS. As used in this
Agreement, the following terms shall have the following meanings (such meanings
to be equally applicable to both the singular and plural forms of the terms
defined):
"ACCEPTANCE FEE" means a fee payable in Cdn. Dollars by the
Borrower to the Administrative Agent for the account of a Lender with respect to
the acceptance of a B/A on the date of such acceptance, calculated on the face
amount of the B/A at the rate per annum applicable on such date as set forth in
the row labeled "Applicable Margin" on Schedule II hereto (which is based on the
ratings (or lack thereof) by Moody's or S&P or both of them of the public
long-term senior unsecured debt securities of the Parent) on the basis of the
number of days in the applicable Contract Period (including the date of
acceptance and excluding the date of maturity) and a year of 365 days.
"ADMINISTRATIVE AGENT" has the meaning specified in the
introduction to this Agreement.
"ADMINISTRATIVE QUESTIONNAIRE" means, with respect to each
Lender, an administrative questionnaire in the form prepared by the
Administrative Agent and submitted to the Administrative Agent (with a copy to
the Borrower) duly completed by such Lender.
"ADVANCE" means an advance by a Lender to the Borrower as part
of a Borrowing, and refers to a Prime Rate Advance, a Base Rate Advance, a Cdn.
Dollar Eurodollar Rate Advance, a U.S. Dollar Eurodollar Rate Advance or a B/A
Advance (each of which shall be a "TYPE" of Advance).
"AFFILIATE" means, as to any Person, any other Person that,
directly or indirectly, controls, is controlled by or is under common control
with such Person or is a director or officer of such Person. The term "CONTROL"
(including the terms "CONTROLS", "CONTROLLED BY" or "UNDER
COMMON CONTROL WITH") means, with respect to any Person, the possession, direct
or indirect, of the power to vote 10% or more (or in the case of an "AFFILIATE"
of any Lender, 5% or more) of the securities having ordinary voting power for
the election of directors of such Person or to direct or cause the direction of
the management and policies of such Person, whether through ownership of voting
securities or by contract or otherwise. Neither a director nor an officer of the
Borrower or Parent, in such capacity, shall be deemed, for purposes of this
Agreement, an Affiliate.
"AGREEMENT" means this Canadian Short-Term Revolving Credit
Agreement, together with all exhibits and schedules hereto, as amended or
otherwise modified from time to time pursuant to the terms hereof.
"APPLICABLE LENDING OFFICE" means, with respect to any Lender,
the office of such Lender specified as its "Applicable Lending Office" in its
Administrative Questionnaire, or in the Assignment and Acceptance or New Lender
Agreement pursuant to which it became a Lender, and/or such other office of such
Lender as such Lender may from time to time specify to the Borrower and the
Administrative Agent with respect to any Type of Advance.
"APPLICABLE MARGIN" means for any date the percentage per
annum applicable on such date as set forth in the row labeled "Applicable
Margin" on Schedule II hereto, which is based on the ratings (or lack thereof)
by Moody's or S&P or both of the public long-term senior unsecured debt
securities of Parent.
"ARRANGER" means J.P. Morgan Securities Inc.
"ASSIGNMENT AND ACCEPTANCE" means an assignment and acceptance
entered into by a Lender and an Eligible Assignee, and accepted by the
Administrative Agent, in substantially the form of Exhibit D hereto.
"AVERAGE AGGREGATE FACILITY ADVANCES" means, for any
Utilization Fee Period, the average daily outstanding amount of (i) all Advances
hereunder and (ii) all "Advances" under, and as defined in, the U.S. Short-Term
Revolving Credit Agreement and the U.S. Long-Term Revolving Credit Agreement.
"AVERAGE AGGREGATE FACILITY COMMITMENTS" means, for any
Utilization Fee Period, the average daily amount of (i) all Commitments
hereunder and (ii) all "Commitments" under, and as defined in, the U.S.
Short-Term Revolving Credit Agreement and the U.S. Long-Term Revolving Credit
Agreement.
"B/A ADVANCE" means a Borrowing comprised of one or more
Bankers' Acceptances or, as applicable, B/A Loans.
"B/A LOAN" has the meaning specified in Section 2.11(i).
"BANKERS' ACCEPTANCE" and "B/A" mean a non-interest bearing
instrument denominated in Cdn. Dollars, drawn by the Borrower and accepted by a
Lender in accordance with this Agreement, and includes a depository note within
the meaning of the Depository Bills and Notes Act (Canada) and a bill of
exchange within the meaning of the Bills of Exchange Act (Canada).
2
"BASE RATE" means, for each day in any period, a fluctuating
interest rate per annum as shall be in effect from time to time which rate per
annum shall at all times for such day be equal to the higher of:
(i) the annual rate of interest announced publicly by the
Administrative Agent and in effect as its base rate at its principal
office in Toronto, Ontario on such day for determining interest rates
on U.S. Dollar-denominated commercial loans made in Canada; and
(ii) 0.50% per annum above the Effective Federal Funds Rate
for such day.
"BASE RATE ADVANCE" means an Advance denominated in U.S.
Dollars that bears interest based upon the Base Rate, as provided in Section
2.06(a)(ii).
"BORROWER" has the meaning specified in the introduction to
this Agreement.
"BORROWING" means a borrowing consisting of Advances of the
same Type made on the same day by the Lenders pursuant to Section 2.01 and, (i)
in the case of Eurodollar Rate Advances, having Interest Periods of the same
duration; and, (ii) in the case of B/A Advances, having Contract Periods of the
same duration; it being understood that there may be more than one Borrowing on
a particular day.
"BUSINESS DAY" means any day that is not a Saturday, Sunday or
other day of the year on which banks are not required or authorized to close in
Calgary, Alberta, Toronto, Ontario or New York, New York, and, if the applicable
Business Day relates to any Eurodollar Rate Advances, a day on which banks are
not required or authorized to close in London, England.
"BUSINESS ENTITY" means a partnership, limited partnership,
limited liability partnership, corporation (including a business trust), limited
liability company, unlimited liability company, joint stock company, trust,
unincorporated association, joint venture or other entity.
"CALCULATION DATE" shall mean the last Business Day of each
month.
"CANADIAN CERTIFICATION REQUIREMENTS" has the meaning
specified in Section 2.16(g) of this Agreement.
"CANADIAN TAXES" has the meaning specified in Section 2.16(a)
of this Agreement.
"CAPITALIZATION" means the sum (without duplication) of (i)
consolidated Debt of the Parent and its consolidated Subsidiaries, plus (ii) the
aggregate amount of Guarantees by the Parent or its consolidated Subsidiaries,
plus (iii) the sum of the preferred stock and common stockholders' equity of the
Parent, plus (iv) the cumulative amount by which Consolidated Tangible Net Worth
shall have been reduced by reason of non-cash write-downs of long-term assets
subsequent to December 31, 1997 (but excluding any such amount with respect to
assets
3
of Project Finance Subsidiaries), minus (v) to the extent otherwise included in
determining the amounts computed under clause (iii) above, the aggregate
investment (net of any Project Financing) of the Parent and its consolidated
Subsidiaries in Project Finance Subsidiaries.
"CDN.$" and "CDN. DOLLAR" mean lawful money of Canada.
"CDN.$ EQUIVALENT" means, at the date of determination, (i)
with respect to any amount in Cdn. Dollars, such amount and (ii) with respect to
any amount in U.S. Dollars, the equivalent in Cdn. Dollars of such amount,
determined by the Administrative Agent pursuant to Section 2.24 using the
Exchange Rate with respect to U.S. Dollars in effect for such amount under the
provisions of such Section.
"CDN. DOLLAR EURODOLLAR RATE" means, for any Interest Period
for each Cdn. Dollar Eurodollar Rate Advance comprising part of the same
Borrowing, the interest rate per annum equal to the average (rounded upward to
the nearest whole multiple of 1/16 of 1% per annum, if such average is not such
a multiple) of the rate per annum at which deposits in Cdn. Dollars are offered
by the principal office of each of the Reference Banks in London, England, to
prime banks in the London interbank market at 11:00 A.M. (London, England time)
two Business Days before the first day of such Interest Period in an amount
comparable to the amount of such Borrowing and for a period equal to such
Interest Period. The Cdn. Dollar Eurodollar Rate for the Interest Period for
each Cdn. Dollar Eurodollar Rate Advance comprising part of the same Borrowing
shall be determined by the Administrative Agent on the basis of applicable rates
furnished to and received by the Administrative Agent from the Reference Banks
two Business Days before the first day of such Interest Period, subject,
however, to the provisions of Section 2.08.
"CDN. DOLLAR EURODOLLAR RATE ADVANCE" means an Advance
denominated in Cdn. Dollars that bears interest determined by reference to the
Cdn. Dollar Eurodollar Rate, as provided in Section 2.06(a)(iii)(x).
"CDOR RATE" means, for each day in any period, the annual rate
of interest that is the rate based on an average rate applicable to Cdn. Dollar
bankers' acceptances for a term equal to the term of the relevant Contract
Period (or for a term of 30 days for purposes of determining the Prime Rate)
appearing on the "Reuters Screen CDOR Page" (as defined in the International
Swaps and Derivatives Association, Inc. definitions, as modified and amended
from time to time) at approximately 8:00 a.m. (Calgary local time), on such
date, or if such date is not a Business Day, on the immediately preceding
Business Day, provided that if such rate does not appear on the Reuters Screen
CDOR Page on such date as contemplated, then the CDOR Rate on such date shall be
the arithmetic average of the Discount Rate quoted by each Schedule I Reference
Bank (determined by the Administrative Agent as of 8:00 a.m. Calgary local time
on such date) which would be applicable to Cdn. Dollar Bankers' Acceptances
quoted by the banks listed in Schedule I of the Bank Act (Canada) as of 8:00
a.m. (Calgary local time) on such date or, if such date is not a Business Day,
on the immediately preceding Business Day.
"CHANGE IN LAW" means (a) the adoption of any law, rule or
regulation after the date of this Agreement, (b) any change in any law, rule or
regulation or in the interpretation or application thereof by any governmental
authority after the date of this Agreement or
4
(c) compliance by any Lender with any request, guideline or directive (whether
or not having the force of law) of any governmental authority if such request,
guideline or directive is made or issued after the date of this Agreement and
reflects a change after the date of this Agreement in the policies or practices
to which such request, guideline or directive relates.
"CLAM" means CLAM Petroleum B.V., a Netherlands company, and
CLAM's successors.
"CLAM CREDIT AGREEMENT" means the Amended and Restated Credit
Agreement dated as of July 25, 1985, among MaraLou Netherlands Partnership,
CLAM, the banks parties thereto and Morgan, as agent for such banks, as amended
and restated as of August 15, 1997, or any successor credit agreement entered
into for the purpose of refinancing such Amended and Restated Credit Agreement,
in each case, as amended, restated, extended or otherwise modified from time to
time.
"COMMITMENT" has the meaning specified in Section 2.01(a).
"COMMITMENT INCREASE NOTICE" has the meaning specified in
Section 2.20(a).
"COMMITMENT INCREASE AGREEMENT" has the meaning specified in
Section 2.20(c).
"COMMITMENT PERCENTAGE" means, as to any Lender at any time,
the percentage that such Lender's Commitment then constitutes of the aggregate
Commitments (or, at any time after the Commitments shall have expired or
terminated, the percentage that the aggregate principal amount of such Lender's
Advances then outstanding constitutes of the aggregate principal amount of the
Advances then outstanding).
"CONSOLIDATED TANGIBLE NET WORTH" means, on a consolidated
basis, the excess of (i) the sum of (x) the preferred stock and common
stockholders' equity of Parent and (y) the cumulative amount by which
Consolidated Tangible Net Worth shall have been reduced by reason of non-cash
write-downs of long-term assets subsequent to December 31, 1997, over (ii) the
intangible assets of Parent and its consolidated Subsidiaries.
"CONTINGENT GUARANTY" has the meaning specified in the
definition of the term "Guaranty" contained in this Section 1.01.
"CONTINUE", "CONTINUATION" and "CONTINUED" each refers to a
continuation of Advances of one Type as Advances of another Type pursuant to
Section 2.08, 2.09 or 2.14 or the continuation of Advances of the same Type for
additional Interest Periods or Contract Periods, as applicable.
"CONTRACT PERIOD" means (a) with respect to Bankers'
Acceptances, the term of a B/A Advance selected by the Borrower in accordance
with Section 2.02 commencing on the date of such B/A Advance and expiring on a
Business Day which shall be either 30 days, 60 days, 90 days, 180 days or, with
the consent of each Lender, any other number of days from 1 to 180, provided
that (i) subject to subparagraph (ii) below, each such period shall be subject
to such extensions or reductions as may be determined by the Administrative
Agent to ensure that each
5
Contract Period shall expire on a Business Day, and (ii) no Contract Period
shall extend beyond the Revolving Commitment Termination Date and (b) with
respect to a B/A Loan, an Interest Period equal to the Contract Period of the
Bankers' Acceptances for which it is a substitute.
"CURRENCY DUE" has the meaning specified in Section 2.23.
"DEBT" of any Person means, without duplication (i)
indebtedness of such Person for borrowed money or in respect of bankers'
acceptances, (ii) obligations of such Person (other than any portion of any
trade payable obligation of such Person which shall not have remained unpaid for
91 days or more from the later of (A) the original due date of such portion and
(B) the customary payment date in the industry and relevant market for such
portion) to pay the deferred purchase price of property or services, (iii)
obligations of such Person as lessee under leases which shall have been or
should be, in accordance with GAAP, recorded as capital leases, and (iv) Overdue
Reimbursement Obligations; provided, however, that where any such indebtedness
or obligation of such Person is made jointly, or jointly and severally, with any
third party or parties, which are not the Borrower or Parent, or any of their
consolidated Subsidiaries, the amount thereof for the purposes of this
definition only shall be the pro rata portion thereof payable by such Person, so
long as such third party or parties have not defaulted on its or their joint and
several portions thereof, and provided, further, that the following shall not at
any time constitute Debt: (1) obligations of such Person to reimburse a bank or
other Person in respect of amounts paid under a letter of credit or similar
instrument that are not Overdue Reimbursement Obligations, (2) Project
Financing, (3) the Morgan Gold Loans unless, at such time, for any reason
whatsoever, (A) no royalty income shall have accrued under the Royalty Agreement
dated as of December 5, 1984 between Copper Range Company, a Michigan
corporation, and LL&E during the three consecutive fiscal quarters of LL&E most
recently ended prior to such time or (B) any payment required to have been made
to LL&E under such agreement prior to such time shall not have been paid on, or
within 30 days after, the date such payment is due, and (4) amounts borrowed by
the Borrower or Parent and their consolidated Subsidiaries under life insurance
policies issued to one or more of the foregoing and covering employees or former
employees of one or more of the foregoing not in excess of the cash surrender
value of such policies.
"DISCOUNT PROCEEDS" means, for any B/A, an amount (rounded up
to the nearest whole cent, and with one-half of one cent being rounded up)
calculated on the date of the Borrowing by multiplying:
(i) the face amount of the B/A; by
(ii) the quotient of one divided by the sum of one plus the
product of
(A) the Discount Rate (expressed as a decimal) applicable to
such B/A, multiplied by
(B) a fraction, the numerator of which is the Contract Period
of the B/A and the denominator of which is 365, with such
quotient being rounded up or down to the nearest fifth decimal
place, and with .000005 being rounded up.
6
"DISCOUNT RATE" means:
(i) with respect to any Lender which is a Schedule I chartered
bank under the Bank Act (Canada), as applicable to a B/A being
purchased by such Lender on any day, the CDOR Rate; and
(ii) with respect to any Lender which is not a Schedule I
chartered bank under the Bank Act (Canada), as applicable to a B/A
being purchased by such Lender on any day, the lesser of (A) the CDOR
Rate plus 10 basis points (0.10%), and (B) the average (as determined
by the Administrative Agent in good faith) of the respective percentage
discount rates (expressed to two decimal places and rounded upward, if
not in an increment of 1/100th of 1%, to the nearest 0.01%) quoted by
the Schedule II/III Reference Banks as the percentage discount rates at
which the Schedule II/III Reference Banks would, in accordance with
their normal market practices, at or about 10:00 a.m. (Toronto, Ontario
time) on such date, be prepared to purchase bankers' acceptances
accepted by the Schedule II/III Reference Banks having a face amount
and term comparable to the face amount and term of such B/A.
"EFFECTIVE DATE" means the date on which the conditions
precedent set forth in Section 3.01 have been satisfied (or compliance therewith
shall have been waived by the Lenders), which date the Administrative Agent will
promptly confirm to the Borrower and the Lenders in writing, and which date
shall be no earlier than December 7, 2001.
"EFFECTIVE FEDERAL FUNDS RATE" means, for any day, the
weighted average of the rates on overnight Federal funds transactions with
members of the Federal Reserve System arranged by Federal funds brokers, as
published for such day (or, if such day is not a Business Day, for the next
preceding Business Day) by the Federal Reserve Bank of New York or, if such rate
is not so published for any day which is a Business Day, the average of the
quotations for such day on such transactions received by the Administrative
Agent from three Federal funds brokers of recognized standing selected by it.
"ELIGIBLE ASSIGNEE" means, with respect to any particular
assignment under Section 9.07, any bank or other entity approved in writing by
the Borrower expressly with respect to such assignment and, except as to such an
assignment by JPMorgan so long as JPMorgan is the Administrative Agent
hereunder, the Administrative Agent shall be an Eligible Assignee for purposes
of this Agreement, provided that neither the Administrative Agent's nor the
Borrower's approval shall be unreasonably withheld, and provided further that no
such approval shall be necessary if (i) the assignee is a Lender Affiliate, (ii)
the assignee was a Lender immediately prior to such assignment, or (iii) if an
Event of Default shall then be continuing.
"EQUITY INTERESTS" means any capital stock, partnership, joint
venture, member or limited liability or unlimited liability company interest,
beneficial interest in a trust or similar entity or other equity interest or
investment of whatever nature.
"ERISA" means the Employee Retirement Income Security Act of
1974, as amended from time to time, and the regulations promulgated and rulings
issued from time to time thereunder.
7
"ERISA AFFILIATE" means any Person who is a member of Parent's
controlled group within the meaning of Section 4001(a)(14)(A) of ERISA.
"EURODOLLAR RATE" means the Cdn. Dollar Eurodollar Rate or the
U.S. Dollar Eurodollar Rate, as applicable.
"EURODOLLAR RATE ADVANCE" means a Cdn. Dollar Eurodollar Rate
Advance or a U.S. Dollar Eurodollar Rate Advance, as applicable.
"EURODOLLAR RATE MARGIN" means for any date the percentage per
annum applicable on such date as set forth in the row labeled "Applicable
Margin" on Schedule II hereto, which is based on the ratings (or lack thereof)
by Moody's or S&P or both of the public long-term senior unsecured debt
securities of Parent.
"EVENTS OF DEFAULT" has the meaning specified in Section 6.01.
"EXCHANGE RATE" shall mean with respect to U.S. Dollars on a
particular date, the rate at which U.S. Dollars may be exchanged into Cdn.
Dollars as quoted by the Bank of Canada on the Reuters Bank of Canada page (or,
if not so quoted, the spot rate of exchange quoted for wholesale transactions
made by the Administrative Agent at Calgary, Alberta) at 12:00 noon, Toronto,
Ontario time, on the relevant Reuters screen currency page; provided, that if at
the time of any such determination, for any reason, no such spot rate is being
quoted, the Administrative Agent may use any reasonable method it deems
applicable to determine such rate, and such determination shall be conclusive
absent manifest error.
"EXTENSION REQUEST" means each request by the Borrower made
pursuant to Section 2.21 for the Lenders to extend the Revolving Commitment
Termination Date, which shall contain the information in respect of such
extension specified in Exhibit G and shall be delivered to the Administrative
Agent in writing.
"FACILITY FEE PERCENTAGE" means for any date the percentage
per annum applicable on such date as set forth in the row labeled "Facility Fee
Percentage" on Schedule II hereto, which is based on the ratings (or lack
thereof) by Moody's or S&P or both of the public long-term senior unsecured debt
securities of Parent.
"FINAL MATURITY DATE" means the date occurring five years and
one day after the Revolving Commitment Termination Date or, if such day is not a
Business Day, the next succeeding Business Day.
"FINANCING DOCUMENTS" means this Agreement, the Notices of
Borrowing and the Notes, and each other instrument or agreement entered into by
Parent or the Borrower in connection with this Agreement, as such instrument or
agreement may be amended, modified or supplemented from time to time in
accordance herewith.
"FOREIGN LENDER" means any Lender that is neither a resident
of Canada for purposes of the Income Tax Act nor a Schedule III Bank which
receives all amounts paid under this Agreement in respect of its "Canadian
banking business", as defined in the Income Tax Act.
8
For purposes of this definition, Canada and each province thereof shall be
deemed to constitute a single jurisdiction.
"GAAP" means generally accepted accounting principles in the
United States of America, as in effect from time to time.
"GUARANTEED PARTIES" means the Administrative Agent, the
Arranger, the Lenders and each other Person to whom any of the Obligations are
or shall be owed.
"GUARANTY", "GUARANTEED" and "GUARANTEEING" each means any act
by which a Person assumes, guarantees, endorses or otherwise incurs direct or
contingent liability in connection with, or agrees to purchase or otherwise
acquire or otherwise assures a creditor against loss in respect of, any Debt or
Project Financing of any Person other than the Borrower, the Parent or any of
their consolidated Subsidiaries (excluding (i) any liability by endorsement of
negotiable instruments for deposit or collection or similar transactions in the
ordinary course of business, (ii) any liability in connection with obligations
of the Borrower, Parent or any of their consolidated Subsidiaries, including
obligations under any conditional sales agreement, equipment trust financing or
equipment lease, (iii) any liability or other act of the Borrower, Parent or any
of their consolidated Subsidiaries under arrangements entered into in connection
with the CLAM Credit Agreement, U.S. Short-Term Revolving Credit Agreement or
the U.S. Long-Term Revolving Credit Agreement, and (iv) any such act in
connection with a Project Financing that either (A) guarantees to the provider
of such Project Financing or any other Person performance of the acquisition,
improvement, installation, design, engineering, construction, development,
completion, maintenance or operation of, or otherwise affects any such act in
respect of, all or any portion of the project that is financed by such Project
Financing or performance by a Project Financing Subsidiary of certain
obligations to Persons other than the provider of such Project Financing, except
during any period, and then only to the extent, that such guaranty is a direct
guaranty of payment of such Project Financing (other than a guaranty of payment
of the type referred to in subclause (B) below) or (B) is contingent upon, or
the obligation to pay or perform under which is contingent upon, the occurrence
or existence of any event or condition other than or in addition to (1) the
passage of time, (2) any Project Financing becoming due, (3) the commencement of
bankruptcy, insolvency or similar proceedings by the obligor on any Project
Financing or (4) the failure of the obligor on any Project Financing to satisfy
a financial ratio, covenant or other similar financial measurement test, but
only during such period as such act is not by its terms presently enforceable,
or if so enforceable, there is not a reasonable probability that the guarantor
will be called upon to perform thereunder (or to make capital contributions in
lieu of performance thereunder) (any such act referred to in this clause (iv)
being a "Contingent Guaranty")); provided, however, that for the purposes of
this definition the liability of the Borrower, Parent or any of their
Subsidiaries with respect to any obligation as to which a third party or parties
are jointly, or jointly and severally, liable as a guarantor or otherwise as
contemplated hereby and have not defaulted on its or their portions thereof,
shall be only its pro rata portion of such obligation.
"INCOME TAX ACT" means the Income Tax Act (Canada), as amended
from time to time.
9
"INDEMNIFIED PARTY" means any or all of the Lenders, the
Arranger and the Administrative Agent.
"INITIAL LENDERS" has the meaning specified in the
introduction to this Agreement.
"INSUFFICIENCY" means, with respect to any Plan, the amount,
if any, of its unfunded benefit liabilities, as defined in Section 4001(a)(18)
of ERISA.
"INTEREST PERIOD" means (a) for each Eurodollar Rate Advance
(other than a B/A Loan) comprising part of the same Borrowing, the period
beginning on the date of such Advance or the date of the Continuation of any
Advance as such Advance and ending on the last day of the period selected by the
Borrower pursuant to the provisions below and, thereafter, each subsequent
period commencing on the last day of the immediately preceding Interest Period
and ending on the last day of the period selected by the Borrower pursuant to
the provisions below and (b) for each B/A Loan, the period beginning on the date
of such B/A Loan and ending on the last day of the Contract Period of the
Bankers' Acceptances for which such B/A Loan is a substitute. The duration of
each such Interest Period for a Eurodollar Rate Advance (other than a B/A Loan)
shall be (i) one, two, three or six months upon notice received by the
Administrative Agent not later than 10:00 a.m. (Calgary local time) on the third
Business Day prior to the first day of such Interest Period, or (ii) subject to
availability to each Lender, nine or twelve months upon notice received by the
Administrative Agent not later than 10:00 a.m. (Calgary local time) on the
fourth Business Day prior to the first day of such Interest Period, in each case
as the Borrower may select; provided, however, that:
(A) the duration of any Interest Period which commences before
the Termination Date and would otherwise end after the
Termination Date shall end on the Termination Date and the
duration of any Interest Period which would otherwise end
after the Final Maturity Date shall end on the Final Maturity
Date;
(B) if the last day of such Interest Period would otherwise
occur on a day which is not a Business Day, such last day
shall be extended to the next succeeding Business Day, except
if such extension would cause such last day to occur in a new
calendar month, then such last day shall occur on the next
preceding Business Day;
(C) Interest Periods commencing on the same date for Advances
comprising the same Borrowing shall be of the same duration;
and
(D) any Interest Period which begins on the last Business Day
of a calendar month (or on a day for which there is no
numerically corresponding day in the calendar month at the end
of such Interest Period) shall, subject to clause (A) above,
end on the last Business Day of a calendar month.
"JPMORGAN" means J.P. Morgan Bank Canada.
"JUDGMENT CURRENCY" has the meaning specified in Section 2.23.
10
"LENDER AFFILIATE" means, with respect to any Lender, (a) an
Affiliate of such Lender or (b) any entity (whether a corporation, partnership,
trust or otherwise) that is engaged in making, purchasing, holding or otherwise
investing in bank loans and similar extensions of credit in the ordinary course
of its business and is administered or managed by a Lender or an Affiliate of
such Lender (with such Lender or Affiliate having the sole right and
responsibility with respect to the approval of amendments and waivers to this
Agreement, the Notes and all related agreements and instruments entered into
from time to time).
"LENDERS" means the Initial Lenders, each bank or other
financial institution that shall become a party hereto pursuant to Section 2.20,
and each Eligible Assignee that shall become a party hereto pursuant to Section
9.07(a), (b) and (d).
"LIEN" means any lien, security interest or other charge or
encumbrance, or any assignment of the right to receive income, or any other type
of preferential arrangement, in each case to secure any Debt or any Guaranty of
any Person; provided that (i) the creation of interests in property of the
character commonly referred to as a "royalty interest" or "overriding royalty
interest", farmouts, joint operating or unitization agreements, or other similar
transactions in the ordinary course of business and (ii) borrowings under life
insurance policies as described in clause (4) of the proviso to the definition
of "Debt" shall not be deemed to create a Lien.
"LL&E" means The Louisiana Land and Exploration Company, a
Maryland corporation and a wholly-owned Subsidiary of the Parent.
"MAJORITY LENDERS" means at any time Lenders holding at least
51% of the then aggregate unpaid principal amount of the Advances held by
Lenders, or, if no such principal amount is then outstanding, Lenders having at
least 51% of the Commitments.
"MARGIN STOCK" means "margin stock" as defined in Regulation U
of the Board of Governors of the United States Federal Reserve System, as in
effect from time to time.
"MATERIAL ADVERSE EFFECT" means a material adverse effect on
the financial condition or operations of Parent and its consolidated
Subsidiaries on a consolidated basis.
"MATERIAL PLAN" means any Plan the assets of which exceed
U.S.$50,000,000 or the liabilities of which for unfunded vested benefits
determined on a plan termination basis (in accordance with Title IV of ERISA)
exceed U.S.$10,000,000.
"MATERIAL SUBSIDIARY" means, from time to time, any Subsidiary
of Parent (other than a Project Financing Subsidiary) then owning assets
(determined on a consolidated basis) that equal or exceed 10% of the book value
of the consolidated assets of Parent and its consolidated Subsidiaries at such
time; provided that for purposes of this definition the term "Material
Subsidiary" shall always include the Borrower and its successors.
"MOODY'S" means Moody's Investors Service, Inc.
"MORGAN" means Morgan Guaranty Trust Company of New York, and
its successors.
11
"MORGAN GOLD LOANS" means the obligations of LL&E under the
respective Credit Agreements dated as of December 23, 1994 and March 31, 1995
between LL&E and Morgan, or under any additional credit agreements on
substantially similar terms, in each case, as amended, restated, extended or
otherwise modified from time to time, provided that the aggregate outstanding
amount borrowed thereunder shall at no time exceed 35,000 ounces of gold.
"MULTIEMPLOYER PLAN" means a "multiemployer plan" as defined
in Section 4001(a)(3) of ERISA to which Parent or any ERISA Affiliate is making
or accruing an obligation to make contributions, or has within any of the
preceding five plan years made or accrued an obligation to make contributions,
such plan being maintained pursuant to one or more collective bargaining
agreements.
"MULTIPLE EMPLOYER PLAN" means a single employer plan, as
defined in Section 4001(a)(15) of ERISA, which (i) is maintained for employees
of Parent or an ERISA Affiliate and at least one Person other than the Borrower,
Parent and its ERISA Affiliates or (ii) was so maintained and in respect of
which Parent or an ERISA Affiliate could have liability under Section 4064 or
4069 of ERISA in the event such plan has been or were to be terminated.
"NEW LENDER" has the meaning specified in Section 2.20(b).
"NEW LENDER AGREEMENT" has the meaning specified in Section
2.20(b).
"NOTE" means a promissory note of the Borrower payable to the
order of any Lender, in substantially the form of Exhibit A hereto, evidencing
the aggregate indebtedness of the Borrower to such Lender resulting from the
Advances made by such Lender.
"NOTICE OF BORROWING" has the meaning specified in Section
2.02(a).
"NOTICE OF CONTINUATION" has the meaning specified in Section
2.09.
"OBJECTING LENDERS" has the meaning specified in Section
2.21(a).
"OBLIGATIONS" means (a) the Borrower's obligations in respect
of the due and punctual payment of (i) the principal of and interest on the
Advances and the Notes when and as due, whether at maturity, by acceleration,
upon one or more dates set for prepayment or otherwise, and (ii) all fees,
expenses, indemnities, expense reimbursement obligations and other obligations,
monetary or otherwise, of the Borrower under this Agreement or any other
Financing Document and (b) all other obligations, monetary or otherwise, of the
Borrower under each Financing Document to which it is a party.
"OFFERED INCREASE AMOUNT" has the meaning specified in Section
2.20(a).
"ORIGINAL EFFECTIVE DATE" means February 25, 1998.
"OTHER TAXES" has the meaning specified in Section 2.16(d) of
this Agreement.
12
"OVERDUE REIMBURSEMENT OBLIGATIONS" means, with respect to any
Person, non-contingent obligations of such Person to reimburse a bank or other
Person in respect of amounts paid under a letter of credit or similar instrument
that are not paid on or prior to the fifth Business Day after the due date
therefor.
"PARENT" has the meaning specified in the introduction to this
Agreement.
"PAYMENT OFFICE" means the Administrative Agent's office
located at 200 Bay Street, Suite 1800, Royal Bank Plaza, South Tower, Toronto,
Ontario M5J 2J2 (or such other office or individual as the Administrative Agent
may hereafter designate in writing to the other parties hereto).
"PBGC" means the Pension Benefit Guaranty Corporation (or any
successor).
"PERMITTED ASSETS" means (i) hydrocarbon or other reserves
(including proved, probable, possible or speculative reserves), (ii) properties,
assets, rights or business related to reserves (including real property,
gathering systems, plants, pipelines, equipment and processing and treatment
facilities), (iii) other fixed or operating assets and (iv) Equity Interests in
any and all Business Entities that are or become Subsidiaries of the Borrower or
Parent owning assets referred to in any of the foregoing clauses.
"PERMITTED LIENS" means:
(i) inchoate Liens and charges imposed by law and incidental
to construction, maintenance, development or operation of properties,
or the operation of business, in the ordinary course of business if
payment of the obligation secured thereby is not yet overdue or if the
validity or amount of which is being contested in good faith by the
Borrower, Parent or any of their respective Subsidiaries;
(ii) Liens for taxes, assessments, obligations under workers'
compensation or other social security legislation or other governmental
requirements, charges or levies, in each case not yet overdue;
(iii) Liens reserved in any oil, gas or other mineral lease
entered into in the ordinary course of business for rent, royalty or
delay rental under such lease and for compliance with the terms of such
lease;
(iv) easements, servitudes, rights-of-way and other rights,
exceptions, reservations, conditions, limitations, covenants and other
restrictions which do not materially interfere with the operation,
value or use of the properties affected thereby;
(v) conventional provisions contained in any contracts or
agreements affecting properties under which the Borrower, Parent or any
of their respective Subsidiaries is required immediately before the
expiration, termination or abandonment of a particular property to
reassign to such Person's predecessor in title all or a portion of the
such Person's rights, titles and interests in and to all or a portion
of such property;
13
(vi) any Lien reserved in a grant or conveyance in the nature
of a farm-out or conditional assignment to the Borrower, Parent or any
of their respective Subsidiaries entered into in the ordinary course of
business on reasonable terms to secure undertakings of the Borrower,
Parent or any such Subsidiary in such grant or conveyance;
(vii) any Lien consisting of (A) statutory landlord's liens
under leases to which the Borrower, Parent or any of their respective
Subsidiaries is a party or other Liens on leased property reserved in
leases thereof for rent or for compliance with the terms of such
leases, (B) rights reserved to or vested in any municipality or
governmental, statutory or public authority to control or regulate any
property of the Borrower, Parent or any of their respective
Subsidiaries, or to use such property in any manner which does not
materially impair the use of such property for the purposes for which
it is held by the Borrower, Parent or any such Subsidiary, (C)
obligations or duties to any municipality or public authority with
respect to any franchise, grant, license, lease or permit and the
rights reserved or vested in any governmental authority or public
utility to terminate any such franchise, grant, license, lease or
permit or to condemn or expropriate any property, and (D) zoning laws
and ordinances and municipal regulations;
(viii) Liens on Equity Interests in, or Debt or other
obligations of, CLAM owned by the Parent, the Borrower or any of their
respective Subsidiaries, which Liens secure Debt of CLAM; and
(ix) any Lien on any assets (including Equity Interests and
other obligations) securing Debt incurred or assumed for the purpose of
financing all or any part of the cost of acquiring, improving,
installing, designing, engineering, developing (including drilling), or
constructing such assets, provided that such Lien attaches to such
assets concurrently with or within 360 days after the acquisition or
completion of development, construction or installation thereof or
improvement thereto.
"PERSON" means an individual, a Business Entity, or a country
or any political subdivision thereof or any agency or instrumentality of such
country or subdivision.
"PLAN" means a Single Employer Plan or a Multiple Employer
Plan.
"PRIME RATE" means, for each day in any period, a fluctuating
interest rate per annum as shall be in effect from time to time which rate per
annum shall at all times for such day be equal to the higher of:
(i) the annual rate of interest announced publicly by the
Administrative Agent and in effect as its prime rate at its principal
office in Toronto, Ontario on such day for determining interest rates
on Cdn. Dollar-denominated commercial loans made in Canada; and
(ii) 0.50% per annum above the 30 day CDOR Rate in effect on
such date.
"PRIME RATE ADVANCE" means an Advance denominated in Cdn.
Dollars that bears interest at a rate based on the Prime Rate, as provided in
Section 2.06(a)(i).
14
"PRIME RATE BORROWING" means a Borrowing comprised of one or
more Prime Rate Advances.
"PROJECT FINANCING" means any Debt incurred to finance or
refinance the acquisition, improvement, installation, design, engineering,
construction, development, completion, maintenance or operation of, or otherwise
in respect of, all or any portion of any project, or any asset related thereto,
and any Guaranty with respect thereto, other than any portion of such Debt or
Guaranty permitting or providing for recourse against Parent, the Borrower or
any of their respective Subsidiaries other than (i) recourse to the Equity
Interests in, Debt or other obligations of, or assets of, one or more Project
Financing Subsidiaries, and (ii) such recourse as exists under any Contingent
Guaranty.
"PROJECT FINANCING SUBSIDIARY" means any Subsidiary of Parent
or the Borrower whose principal purpose is to incur Project Financing, or to
become a direct or indirect partner, member or other equity participant or owner
in a Business Entity so created, and substantially all the assets of which
Subsidiary or Business Entity are limited to those assets being financed (or to
be financed), or the operation of which is being financed (or to be financed),
in whole or in part by a Project Financing or to Equity Interests in, or Debt or
other obligations of, one or more other such Subsidiaries or Business Entities.
"RE-ALLOCATION DATE" has the meaning specified in Section
2.20(e).
"REFERENCE BANKS" means JPMorgan, Citibank Canada and Bank of
America Canada.
"REGISTER" has the meaning specified in Section 9.07(c).
"REQUIRED LENDERS" means Lenders (i) that are not Objecting
Lenders with respect to any previous Extension Request and (ii) that have
Commitment Percentages aggregating at least 51% of the aggregate Commitment
Percentages of such non-Objecting Lenders.
"RESET DATE" has the meaning specified in Section 2.24.
"REVOLVING ADVANCE" means an Advance made or to be made by a
Lender pursuant to Section 2.01(a).
"REVOLVING COMMITMENT TERMINATION DATE" means December 5,
2002, or, at the option of the Borrower, such later date as shall be determined
pursuant to the provisions of Section 2.21 with respect to non-Objecting
Lenders, provided that if such date is not a Business Day, the Revolving
Commitment Termination Date shall be the next preceding Business Day.
"S&P" means Standard and Poor's, a division of The McGraw-Hill
Companies, Inc.
"SCHEDULE I BANKS" means a bank that is a Canadian chartered
bank listed on Schedule I under the Bank Act (Canada).
15
"SCHEDULE I REFERENCE BANKS" means each of Royal Bank of
Canada and such other Schedule I Banks as are agreed to from time to time by the
Borrower and the Administrative Agent, each acting reasonably; provided that
there shall be no more than three Schedule I Reference Banks at any one time.
"SCHEDULE II LENDER" has the meaning specified in Section 1.05
of this Agreement.
"SCHEDULE II/III REFERENCE BANKS" means JPMorgan Chase Bank,
Toronto Branch, Citibank Canada and Bank of America Canada or such other
Schedule II chartered banks under the Bank Act (Canada) or Schedule III Banks as
are mutually agreed upon by the Administrative Agent and the Borrower.
"SCHEDULE III BANK" means a bank listed on Schedule III under
the Bank Act (Canada).
"SINGLE EMPLOYER PLAN" means a single employer plan, as
defined in Section 4001(a)(15) of ERISA, that (i) is maintained for employees of
Parent or an ERISA Affiliate and no Person other than Parent and its ERISA
Affiliates or (ii) was so maintained and in respect of which Parent or an ERISA
Affiliate could have liability under Section 4069 of ERISA in the event such
plan has been or were to be terminated.
"SUBSIDIARY" means, as to any Person, any Business Entity of
which shares of stock or other Equity Interests having ordinary voting power
(other than stock or such other Equity Interests having such power only by
reason of the happening of a contingency) to elect a majority of the board of
directors or other managers of such Business Entity are at the time owned,
directly or indirectly through one or more Subsidiaries, or both, by such
Person. Unless otherwise qualified, all references to a "Subsidiary" or to
"Subsidiaries" in this Agreement shall refer to a Subsidiary or Subsidiaries of
Parent.
"TAXES" has the meaning specified in Section 2.16(b) of this
Agreement.
"TERMINATION DATE" means the earlier of (i) the Revolving
Commitment Termination Date and (ii) the date of termination in whole of the
Commitments pursuant to Section 2.04 or 6.01.
"TERMINATION EVENT" means (i) a "reportable event," as such
term is described in Section 4043 of ERISA (other than a "reportable event" not
subject to the provision for 30-day notice to the PBGC), or an event described
in Section 4062(e) of ERISA, or (ii) the withdrawal of Parent or any ERISA
Affiliate from a Multiple Employer Plan during a plan year in which it was a
"substantial employer," as such term is defined in Section 4001(a)(2) of ERISA,
or the incurrence of liability by Parent or any ERISA Affiliate under Section
4064 of ERISA upon the termination of a Multiple Employer Plan, or (iii) the
filing of a notice of intent to terminate a Plan or the treatment of a Plan
amendment as a termination under Section 4041 of ERISA, or (iv) the institution
of proceedings to terminate a Plan by the PBGC under Section 4042 of ERISA, or
(v) the conditions set forth in Section 302(f)(1)(A) and (B) of ERISA to the
creation of a lien upon property or rights to property of Parent or any ERISA
Affiliate for failure to make a required payment to a Plan are satisfied, or
(vi) the adoption of an amendment to a Plan
16
requiring the provision of security to such Plan, pursuant to Section 307 of
ERISA, or (vii) any other event or condition which might constitute grounds
under Section 4042 of ERISA for the termination of, or the appointment of a
trustee to administer, any Plan.
"TERM ADVANCE" means an Advance made or to be made by a Lender
pursuant to Section 2.01(b).
"TRANSACTIONS" means the execution, delivery and performance
by the Borrower and Parent (as applicable) of this Agreement and the other
Financing Documents and the borrowing of Advances.
"TYPE" has the meaning specified in the definition of
"Advance".
"U.S.$" and "U.S. DOLLARS" means lawful money of the United
States of America.
"U.S. DOLLAR EURODOLLAR RATE" means, for any Interest Period
for each U.S. Dollar Eurodollar Rate Advance comprising part of the same
Borrowing, the interest rate per annum equal to the average (rounded upward to
the nearest whole multiple of 1/16 of 1% per annum, if such average is not such
a multiple) of the rate per annum at which deposits in U.S. Dollars are offered
by the principal office of each of the Reference Banks in London, England, to
prime banks in the London interbank market at 11:00 A.M. (London, England time)
two Business Days before the first day of such Interest Period in an amount
comparable to the amount of such Borrowing and for a period equal to such
Interest Period. The U.S. Dollar Eurodollar Rate for the Interest Period for
each U.S. Dollar Eurodollar Rate Advance comprising part of the same Borrowing
shall be determined by the Administrative Agent on the basis of applicable rates
furnished to and received by the Administrative Agent from the Reference Banks
two Business Days before the first day of such Interest Period, subject,
however, to the provisions of Section 2.08.
"U.S. DOLLAR EURODOLLAR RATE ADVANCE" means an Advance
denominated in U.S. Dollars that bears interest determined by reference to the
U.S. Dollar Eurodollar Rate, as provided in Section 2.06(a)(iii)(y).
"U.S. LONG-TERM REVOLVING CREDIT AGREEMENT" means the
Long-Term Revolving Credit Agreement dated as of February 25, 1998, as amended
and restated as of December 7, 2001, and as may be further amended from time to
time hereafter, among the Parent, the financial institutions party thereto,
JPMorgan Chase Bank, as administrative agent and auction administrative agent
for such financial institutions, Citibank, N.A. and Fleet National Bank, as
co-syndication agents, and Bank of America, N.A. and Toronto Dominion (Texas),
Inc., as co-documentation agents.
"U.S. SHORT-TERM REVOLVING CREDIT AGREEMENT" means the
Short-Term Revolving Credit Agreement dated as of February 25, 1998, as amended
and restated as of December 7, 2001, and as may be further amended from time to
time hereafter, among the Parent, the financial institutions party thereto,
JPMorgan Chase Bank, as administrative agent and auction administrative agent
for such financial institutions, Citibank, N.A. and Fleet National
17
Bank, as co-syndication agents, and Bank of America, N.A. and Toronto Dominion
(Texas), Inc., as co-documentation agents.
"UTILIZATION FEE PERIOD" means any period during the term of
this Agreement commencing on the Effective Date or on a subsequent January 1,
April 1, July 1 or October 1 and ending in each case on the earliest to occur of
the next succeeding March 31, June 30, September 30 or December 31 and the
Termination Date.
"WITHDRAWAL LIABILITY" shall have the meaning given such term
under Part I of Subtitle E of Title IV of ERISA.
SECTION 1.02. COMPUTATION OF TIME PERIODS. Unless otherwise
stated in this Agreement, in the computation of a period of time from a
specified date to a later specified date, the word "from" means "from and
including" and the words "to" and "until" each means "to but excluding."
SECTION 1.03. ACCOUNTING AND OTHER TERMS. All accounting terms
not specifically defined herein shall be construed in accordance with GAAP,
either (i) consistent with those principles applied in the preparation of the
annual financial statements referred to in Section 4.01(e), or (ii) not so
materially inconsistent with such principles that a covenant contained in
Section 5.01 or 5.02 would be calculated or construed in a materially different
manner or with materially different results than if such covenant were
calculated or construed in accordance with clause (i) of this Section 1.03.
"Include", "includes" and "including" shall be deemed to be followed by "without
limitation" whether or not they are in fact followed by such words or words of
like import. References to any agreement or contract are to such agreement or
contract as amended, modified or supplemented from time to time in accordance
with the terms hereof and thereof.
SECTION 1.04. REFERENCES. The words "hereof", "herein" and
"hereunder" and words of similar import when used in this Agreement shall refer
to this Agreement as a whole and not to any particular provision of this
Agreement, and Article, Section, Schedule and Exhibit references are to this
Agreement unless otherwise specified.
SECTION 1.05. SCHEDULE III BANKS. Upon the assignment in
accordance with Section 9.07 by any Lender that is a Schedule II chartered bank
under the Bank Act (Canada) (a "Schedule II Lender") of the rights and
obligations of such Schedule II Lender hereunder to its Lender Affiliate that is
a Schedule III Bank, all references herein to such Schedule II Lender shall be
deemed to be references to such Schedule III Bank.
ARTICLE 2
AMOUNTS AND TERMS OF THE ADVANCES
SECTION 2.01. REVOLVING ADVANCES. (a) (a) Each Lender
severally agrees, on the terms and conditions hereinafter set forth, to make
Revolving Advances to the Borrower from time to time on any Business Day during
the period from the Effective Date to and including the Termination Date in an
aggregate amount not to exceed at any time outstanding the amount set
18
forth opposite such Lender's name on Schedule III hereto, or, if such Lender has
entered into any Assignment and Acceptance or Commitment Increase Agreement or a
New Lender Agreement, set forth for such Lender in the Register maintained by
the Administrative Agent pursuant to Section 9.07(c), as such amount may be
reduced pursuant to Section 2.04 (such Lender's "Commitment"). Subject to
Section 2.11(e) with respect to B/A Advances, each Borrowing consisting of
Revolving Advances shall be in an aggregate amount that is (a) not less than
Cdn.$5,000,000 in the case of a Borrowing comprised of Prime Rate Advances, (b)
not less than U.S.$5,000,000 in the case of a Borrowing comprised of Base Rate
Advances, (c) not less than Cdn.$10,000,000 in the case of a Borrowing comprised
of Cdn. Dollar Eurodollar Rate Advances, and (d) not less than U.S.$10,000,000
in the case of a Borrowing comprised of U.S. Dollar Eurodollar Rate Advances
(or, in the case of a Borrowing of Prime Rate Advances or Base Rate Advances,
the aggregate unused Commitments, if less) and shall consist of Advances of the
same Type made on the same day by the Lenders ratably according to their
respective Commitments. Notwithstanding the foregoing, a Foreign Lender shall
not accept Bankers' Acceptances, and shall not be required to make Prime Rate
Advances and no Lender (other than a Foreign Lender pursuant to Section 2.11(i))
shall be required to make Cdn. Dollar Eurodollar Rate Advances. If a Borrowing
of Prime Rate Advances is requested, a Foreign Lender will participate in such
Borrowing by way of Base Rate Advances. If a Borrowing by way of Bankers'
Acceptances is requested, a Foreign Lender will participate in such Borrowing by
way of Cdn. Dollar Eurodollar Rate Advances in accordance with Section 2.11(i).
Within the limits of each Lender's Commitment, the Borrower may make more than
one Borrowing on any Business Day and may borrow, prepay pursuant to Section
2.10, and reborrow under this Section 2.01(a).
(b) TERM ADVANCES. On the Revolving Commitment Termination
Date (unless the Commitments shall have been terminated in full pursuant to
Article 6), each outstanding Revolving Advance will Continue as a Term Advance
of like amount. Term Advances that are repaid or prepaid, and not Continued, may
not be reborrowed; provided, however, that Advances may be Continued, at the
election of the Borrower, through the Final Maturity Date by the delivery of a
Notice of Continuation. Eurodollar Rate Advances and B/A Loans for which the
Interest Period shall not have terminated as of the Revolving Commitment
Termination Date shall be Continued as Eurodollar Rate Advances or B/A Loans, as
the case may be, for the then applicable Interest Period and Prime Rate Advances
and Base Rate Advances shall be Continued as Prime Rate Advances or Base Rate
Advances, as applicable, after the Revolving Commitment Termination Date, unless
the Borrower shall have elected otherwise by delivery of a Notice of
Continuation. In accordance with Section 2.08, the Borrower may elect to
Continue Borrowings as Borrowings of the same or a different Type or, in the
case of a Eurodollar Rate Advance or B/A Advance, may elect Interest Periods or
Contract Periods therefor; provided that the Borrower shall not be entitled to
elect to Continue any Borrowings if the Interest Period or Contract Period
requested with respect thereto would end after the Final Maturity Date. After
the Revolving Commitment Termination Date, no Lender shall have any further
Commitment to make additional Advances.
SECTION 2.02. MAKING THE ADVANCES. (a) (a) Each Borrowing
shall be made on notice by the Borrower to the Administrative Agent (a "NOTICE
OF BORROWING") received by the Administrative Agent:
19
(i) in the case of a proposed Borrowing comprised of Prime
Rate Advances or Base Rate Advances on the day of notice, provided that
notice is received by the Administrative Agent not later than 9:00 A.M.
(Calgary local time) on the Business Day of such proposed Borrowing;
(ii) in the case of a proposed Borrowing comprised of
Eurodollar Rate Advances, not later than 10:00 a.m. (Calgary local
time) on the third Business Day prior to the date of such proposed
Borrowing; and
(iii) in the case of a proposed Borrowing comprised of B/A
Advances, not later than 10:00 a.m. (Calgary local time) on the second
Business Day prior to the date of such proposed Borrowing or, if such
Borrowing shall include B/A Loans, on the third Business Day prior to
the date of such proposed Borrowing.
Each Notice of Borrowing shall be by telecopy, telefax or
other teletransmission or by telephone (and if by telephone, confirmed promptly
by telecopier, telefax or other teletransmission), in substantially the form of
Exhibit B hereto, specifying therein the requested (w) date of such Borrowing,
(x) Type of Advances comprising such Borrowing and, additionally, whether such
Borrowing consists of Revolving Advances or Term Advances, (y) aggregate amount
of such Borrowing, and (z) in the case of a Borrowing comprised of Eurodollar
Rate Advances, the initial Interest Period and currency for each such Advance,
and in the case of a B/A Advance, the initial Contract Period for such B/A
Advance. Promptly following receipt of the Notice of Borrowing (and in any event
not later than 10:00 a.m. (Calgary local time) on the date of the proposed
Borrowing), the Administrative Agent shall advise each Lender of the details
thereof and of the amount of such Lender's Advance to be made as part of the
requested Borrowing. Each Lender shall, before 11:00 a.m. (Calgary local time)
on the date of such Borrowing, make available for the account of its Applicable
Lending Office to the Administrative Agent in care of its Payment Office, or at
such other location designated by notice from the Administrative Agent to the
Lenders pursuant to Section 9.02, in same day funds, such Lender's ratable
portion of such Borrowing. Immediately after the Administrative Agent's receipt
of such funds and upon fulfillment of the applicable conditions set forth in
Article 3, but no later than 12:00 noon (Calgary local time) on the same date
the Administrative Agent will make such funds available to the Borrower at the
Payment Office of the Administrative Agent, or at any account of the Borrower
maintained by the Administrative Agent (or any successor Administrative Agent)
designated by the Borrower and agreed to by the Administrative Agent (or such
successor Administrative Agent), in same day funds.
(b) If no election as to the Type or duration of Advance is
specified, then the requested Advance shall be a Prime Rate Advance (if
denominated in Cdn. Dollars) or a Base Rate Advance (if denominated in U.S.
Dollars). If no currency is specified, the Advance shall be denominated in Cdn.
Dollars.
(c) Each Notice of Borrowing shall be irrevocable and binding
on the Borrower. In the case of any Borrowing which the related Notice of
Borrowing specified is to be comprised of Eurodollar Rate Advances, if such
Advances are not made as a result of any failure to fulfill on or before the
date specified for such Borrowing the applicable conditions set forth in Article
3, the Borrower shall indemnify each Lender against any loss, cost or expense
incurred
20
by such Lender as a result of such failure, including any loss, cost or expense
incurred by reason of the liquidation or reemployment of deposits or other funds
acquired by such Lender to fund the Advance to be made by such Lender as part of
such Borrowing.
(d) Unless the Administrative Agent shall have received notice
from a Lender prior to the date of any Borrowing that such Lender will not make
available to the Administrative Agent such Lender's ratable portion of such
Borrowing, the Administrative Agent may assume that such Lender has made such
portion available to the Administrative Agent on the date of such Borrowing in
accordance with subsections (a) and (c) of this Section 2.02 and the
Administrative Agent may, in reliance upon such assumption, make available to
the Borrower on such date a corresponding amount. If and to the extent such
Lender shall not have so made such ratable portion available to the
Administrative Agent, such Lender and the Borrower severally agree to repay to
the Administrative Agent forthwith on demand such corresponding amount together
with interest thereon, for each day from the date such amount is made available
to the Borrower until the date such amount is repaid to the Administrative
Agent, at the Prime Rate for such day. If such Lender shall repay to the
Administrative Agent such corresponding amount, such amount so repaid shall
constitute such Lender's Advance to the Borrower as part of such Borrowing for
purposes of this Agreement.
(e) The failure of any Lender to make the Advance to be made
by it as part of any Borrowing shall not relieve any other Lender of its
obligation, if any, hereunder to make its Advance on the date of such Borrowing,
but no Lender shall be responsible for the failure of any other Lender to make
the Advance to be made by such other Lender on the date of any Borrowing.
SECTION 2.03. FEES. (a) FACILITY FEE. The Borrower agrees to
pay to the Administrative Agent for the account of each Lender a facility fee on
the average daily amount of such Lender's Commitment, whether or not used or
deemed used, from the Effective Date in the case of each Initial Lender and from
the effective date specified in the Assignment and Acceptance or Commitment
Increase Agreement pursuant to which it became a Lender in the case of each
other Lender, in each case until the Termination Date, payable quarterly in
arrears on the last day of each March, June, September and December during the
term of such Lender's Commitment and on the Termination Date, at a rate per
annum equal to the Facility Fee Percentage in effect from time to time.
(b) UTILIZATION FEE. The Borrower agrees to pay to the
Administrative Agent for the account of each Lender (i) for any Utilization Fee
Period, if during such Utilization Fee Period the Average Aggregate Facility
Advances were greater than 25% and less than or equal to 50% of the Average
Aggregate Facility Commitments, a utilization fee of 0.125% per annum on the
average daily amount of such Lender's Advances during such Utilization Fee
Period; and (ii) for any Utilization Fee Period, if during such Utilization Fee
Period the Average Aggregate Facility Advances were greater than 50% of the
Average Aggregate Facility Commitments, a utilization fee of 0.25% per annum on
the average daily amount of such Lender's Advances during such Utilization Fee
Period. If a utilization fee is owing in respect of any Utilization Fee Period,
such fee shall be payable on the last day of such Utilization Fee Period.
21
(c) AGENCY FEE. The Borrower agrees to pay to the
Administrative Agent, for its own account, such agency fees as may be separately
agreed to in writing by the Borrower and the Administrative Agent, such fees to
be in the amounts and payable on the dates as may be so agreed to.
SECTION 2.04. REDUCTION OF THE COMMITMENTS. The Borrower shall
have the right, upon at least three Business Days' written notice to the
Administrative Agent, to terminate in whole or reduce ratably in part the unused
portions of the Commitments of the Lenders (being the amount by which such
Commitments exceed the aggregate outstanding principal amount of all Advances),
provided that each partial reduction shall be in the aggregate amount of
Cdn.$10,000,000 or any whole multiple of Cdn.$1,000,000 in excess thereof.
SECTION 2.05. REPAYMENT OF ADVANCES. (a) (a) The Borrower
shall repay to each Lender on the Final Maturity Date the aggregate principal
amount of the Advances, together with accrued interest thereon, then owing to
such Lender.
(b) Subject to Section 2.05(c), after the Revolving Commitment
Termination Date, the Borrower shall repay the principal amount of the Advances
in equal semi-annual installments, each in an amount equal to two and one-half
percent (2.5%) of the aggregate outstanding principal amount of the Advances on
the Revolving Commitment Termination Date. Such installments shall be due and
payable on each June 30 and December 31 of each year, the first such installment
being due and payable on the first December 31 occurring after the Revolving
Commitment Termination Date, with the final installment due and payable on the
Final Maturity Date in an amount equal to the aggregate unpaid principal amount
of such Advances outstanding on the Final Maturity Date.
(c) Subject to Article 6, but notwithstanding any other
provision of this Agreement, the Borrower shall not be required to repay more
than 25% of the principal amount (as defined in the Income Tax Act) of the
Advances made to it prior to five years and one day after the Revolving
Commitment Termination Date, including, but not limited to payments under
Section 2.05(b) and Section 2.10(b).
(d) The Borrower shall provide written notice to the
Administrative Agent substantially in the form of Exhibit C hereto of any
repayments pursuant to this Section 2.05 at least 2 Business Days prior to such
repayment.
SECTION 2.06. INTEREST ON ADVANCES. (a) ORDINARY INTEREST.
The Borrower shall pay interest on the unpaid principal amount of each Advance
owing to each Lender from the date of such Advance until such principal amount
is due (whether at stated maturity, by acceleration or otherwise), at the
following rates:
(i) PRIME RATE ADVANCES. During such periods as such Advance
is a Prime Rate Advance, a rate per annum equal at all times to the
Prime Rate in effect from time to time plus, following the Revolving
Commitment Termination Date, as additional interest in lieu of the
facility fee, the Facility Fee Percentage in effect from time to time,
payable quarterly in arrears on the last day of each March, June,
September and December during
22
such periods and on the date such Prime Rate Advance shall be Continued
or due (whether at stated maturity, by acceleration or otherwise).
(ii) BASE RATE ADVANCES. During such periods as such Advance
is a Base Rate Advance, a rate per annum equal at all times to the Base
Rate in effect from time to time plus, following the Revolving
Commitment Termination Date, as additional interest in lieu of the
facility fee, the Facility Fee Percentage in effect from time to time,
payable quarterly in arrears on the last day of each March, June,
September and December during such periods and on the date such Base
Rate Advance shall be Continued or due (whether at stated maturity, by
acceleration or otherwise).
(iii) EURODOLLAR RATE ADVANCES. During such periods as such
Advance is (x) a Cdn. Dollar Eurodollar Rate Advance, a rate per annum
equal at all times during each Interest Period for such Advance to the
sum of the Cdn. Dollar Eurodollar Rate for such Interest Period plus
the Eurodollar Rate Margin in effect from time to time plus, following
the Revolving Commitment Termination Date, as additional interest in
lieu of the facility fee, the Facility Fee Percentage in effect from
time to time, payable on the last day of each such Interest Period and,
if any such Interest Period has a duration of more than three months,
on each day which occurs during such Interest Period every three months
from the first day of such Interest Period and, if such Advance is
Continued as a Prime Rate Advance on any date other than the last day
of any Interest Period for such Advance, on the date of such
Continuation or, if later, the Business Day on which the Borrower shall
have received at least one Business Day's prior notice from the
Administrative Agent or the applicable Lender of the amount of unpaid
interest accrued on such Advance to the date of such Continuation and
(y) a U.S. Dollar Eurodollar Rate Advance, a rate per annum equal at
all times during each Interest Period for such Advance to the sum of
the U.S. Dollar Eurodollar Rate for such Interest Period plus the
Eurodollar Rate Margin in effect from time to time plus, following the
Revolving Commitment Termination Date, as additional interest in lieu
of the facility fee, the Facility Fee Percentage in effect from time to
time, payable on the last day of each such Interest Period and, if any
such Interest Period has a duration of more than three months, on each
day which occurs during such Interest Period every three months from
the first day of such Interest Period and, if such Advance is Continued
as a Base Rate Advance on any date other than the last day of any
Interest Period for such Advance, on the date of such Continuation or,
if later, the Business Day on which the Borrower shall have received at
least one Business Day's prior notice from the Administrative Agent or
the applicable Lender of the amount of unpaid interest accrued on such
Advance to the date of such Continuation.
(iv) B/A ADVANCES. Each Advance comprised of Bankers'
Acceptances shall be subject to an Acceptance Fee, payable by the
Borrower on the date of acceptance of the relevant B/A and computed as
set forth in the definition of "Acceptance Fee" in Section 1.01 plus,
following the Revolving Commitment Termination Date, as an additional
acceptance fee in lieu of the facility fee, the Facility Fee Percentage
in effect from time to time, payable quarterly in arrears on the last
day of each March, June, September and December during such periods and
on the date such B/A Advance shall be Continued or due (whether at
stated maturity, by acceleration or otherwise).
23
(v) ADDITIONAL INTEREST. In addition to amounts payable under
clause (i), (ii), (iii) or (iv) above in respect of any Advance
following the Revolving Commitment Termination Date, the Borrower shall
pay to each Lender hereunder as additional interest an amount in lieu
of the utilization fee equal to 0.25% per annum on the average daily
amount of such Lender's Term Advances during any period (each such
period, an "ADDITIONAL INTEREST PERIOD") during the term of this
Agreement commencing on the Termination Date or on a subsequent January
1, April 1, July 1 or October 1 and ending in each case on the earliest
to occur of the next succeeding March 31, June 30, September 30 or
December 31 and the Final Maturity Date (or, if any Term Advances
remain outstanding after the Final Maturity Date, such later date on
which all such Advances are repaid in full). Additional interest owing
in respect of any Additional Interest Period shall be payable on the
last day of such Additional Interest Period; provided that additional
interest owing after the Final Maturity Date shall be payable on
demand.
(b) DEFAULT INTEREST. The Borrower shall pay interest on the
unpaid principal amount of each Advance that is not paid when due (whether at
stated maturity, by acceleration or otherwise) from the date on which such
amount is due until such amount is paid in full, payable on demand, at a rate
per annum equal at all times (i) from such due date to the last day of the then
existing Interest Period therefor, in the case of each Eurodollar Rate Advance,
to 1% per annum above the interest rate per annum required to be paid on such
Advance immediately prior to the date on which such amount became due and (ii)
from and after the last day of the then existing Interest Period therefor, in
the case of each Eurodollar Rate Advance, and at all times in the case of each
Prime Rate Advance and each Base Rate Advance, to 1% per annum above the Prime
Rate or Base Rate, as applicable, in effect from time to time.
(c) INTEREST ACT CANADA. For the purposes of the Interest Act
(Canada) and disclosure thereunder, whenever any interest or fee to be paid
hereunder or in connection herewith is to be calculated on the basis of any
period of time that is less than a calendar year, the yearly rate of interest to
which the rate used in such calculation is equivalent is the rate so used
multiplied by the actual number of days in the calendar year in which the same
is to be ascertained and divided by 360 or 365, as applicable. The rates of
interest under this Agreement are nominal rates, and not effective rates or
yields. The principle of deemed reinvestment of interest does not apply to any
interest calculation under this Agreement.
(d) NO CRIMINAL RATE. If any provision of this Agreement would
oblige the Borrower to make any payment of interest or other amount payable to
any Lender in an amount or calculated at a rate which would be prohibited by law
or would result in a receipt by that Lender of "interest" at a "criminal rate"
(as such terms are construed under the Criminal Code (Canada)), then,
notwithstanding such provision, such amount or rate shall be deemed to have been
adjusted with retroactive effect to the maximum amount or rate of interest, as
the case may be, as would not be so prohibited by law or so result in a receipt
by that Lender of "interest" at a "criminal rate", such adjustment to be
effected, to the extent necessary (but only to the extent necessary), as
follows:
24
(i) first, by reducing the amount or rate of interest or the
amount or rate of any Acceptance Fee required to be paid to the
affected Lender under Section 2.06(a)(iv); and
(ii) thereafter, by reducing any fees, commissions, premiums
and other amounts required to be paid to the affected Lender which
would constitute interest for purposes of Section 347 of the Criminal
Code (Canada).
SECTION 2.07. [INTENTIONALLY OMITTED]
SECTION 2.08. RATE DETERMINATION. (a) All interest hereunder
shall be payable for the actual number of days elapsed (including the first day
but excluding the last day). Any Advance that is repaid on the same day on which
it is made shall bear interest for one day unless such repayment and notice
thereof are received by 12:00 noon, Toronto, Ontario time, on such day. The
applicable Prime Rate, Base Rate, Eurodollar Rate or Discount Rate shall be
determined by the Administrative Agent, and such determination shall be
conclusive absent manifest error.
(b) Each Reference Bank agrees to furnish to the
Administrative Agent timely information for the purpose of determining each
Eurodollar Rate. If any one or more of the Reference Banks shall not furnish
such timely information to the Administrative Agent for the purpose of
determining any such interest rate, the Administrative Agent shall determine
such interest rate on the basis of timely information furnished by the remaining
Reference Banks. Each Schedule II/III Reference Bank agrees to furnish to the
Administrative Agent timely information for the purpose of determining each
Discount Rate. If any one or more of the Schedule II/III Reference Banks shall
not furnish such timely information to the Administrative Agent for the purpose
of determining such Discount Rate, the Administrative Agent shall determine such
Discount Rate on the basis of timely information furnished by the remaining
Schedule II/III Reference Banks.
(c) The Administrative Agent shall give prompt notice to the
Borrower and the Lenders of the applicable interest rate determined by the
Administrative Agent for purposes of Section 2.06(a)(i), (ii) or (iii), the
applicable rate, if any, furnished by each Reference Bank for the purpose of
determining the applicable interest rate under Section 2.06(a)(iii), and the
applicable Discount Rate, if any, furnished by each Schedule II/III Reference
Bank for the purpose of determining the applicable Discount Rate under Section
2.11(f).
(d) If fewer than two Reference Banks furnish timely
information to the Administrative Agent for determining the Eurodollar Rate for
any applicable Advances,
(i) the Administrative Agent shall give the Borrower and each
Lender prompt notice by telephone (confirmed in writing) that the
interest rate cannot be determined for such applicable Advances,
(ii) (x) to the extent such applicable Advances are Cdn.
Dollar Eurodollar Rate Advances, each such Advance will automatically,
on the last day of the then existing Interest Period therefor, Continue
as a Prime Rate Advance (or if such Advance is then a Prime Rate
Advance, will Continue as a Prime Rate Advance), and (y) to the extent
such
25
applicable Advances are U.S. Dollar Eurodollar Rate Advances, each such
Advance will automatically, on the last day of the then existing
Interest Period therefor, Continue as a Base Rate Advance (or if such
Advance is then a Base Rate Advance, will Continue as a Base Rate
Advance), and
(iii) the obligations of the Lenders to make, or to Continue
Advances as, Cdn. Dollar Eurodollar Rate Advances or U.S. Dollar
Eurodollar Rate Advances, as the case may be, shall be suspended until
the Administrative Agent shall notify the Borrower and the Lenders that
the circumstances causing such suspension no longer exist.
(e) If, with respect to any Eurodollar Rate Advances, the
Majority Lenders determine and give notice to the Administrative Agent that as a
result of conditions in or generally affecting the relevant market, the rates of
interest determined on the basis of the Eurodollar Rate for any Interest Period
for such Advances will not adequately reflect the cost to such Majority Lenders
of making, funding or maintaining their respective Eurodollar Rate Advances for
such Interest Period, the Administrative Agent shall forthwith so notify the
Borrower and the Lenders, whereupon:
(i) (x) to the extent such Advances are Cdn. Dollar Eurodollar
Rate Advances, each such Eurodollar Rate Advance will automatically, on
the last day of the then existing Interest Period therefor, Continue as
a Prime Rate Advance and (y) to the extent such Advances are U.S.
Dollar Eurodollar Rate Advances, each such Eurodollar Rate Advance will
automatically, on the last day of the then existing Interest Period
therefor, Continue as a Base Rate Advance, and
(ii) the obligation of the Lenders to make, or to Continue
Advances as, Cdn. Dollar Eurodollar Rate Advances or U.S. Dollar
Eurodollar Rate Advances, as the case may be, shall be suspended until
the Administrative Agent shall notify the Borrower and the Lenders that
the circumstances causing such suspension no longer exist.
(f) If the Borrower shall fail to select the duration of any
Interest Period for any Eurodollar Rate Advances in accordance with the
provisions contained in the definition of "INTEREST PERIOD" in Section 1.01, the
Administrative Agent will forthwith so notify the Borrower and the Lenders and
(i) to the extent such Advances are Cdn. Dollar Eurodollar Rate Advances, such
Advances will automatically, on the last day of the then existing Interest
Period therefor, Continue as Cdn. Dollar Eurodollar Rate Advances with an
Interest Period of one month and (ii) to the extent such Advances are U.S.
Dollar Eurodollar Rate Advances, such Advances will automatically, on the last
day of the then existing Interest Period therefor, Continue as U.S. Dollar
Eurodollar Rate Advances with an Interest Period of one month. If the Borrower
shall fail to select the duration of any Contract Period for any B/A Advances in
accordance with the provisions contained in the definition of "CONTRACT PERIOD"
in Section 1.01, the Administrative Agent will forthwith so notify the Borrower
and the Lenders and such B/A Advances will be automatically Continued as B/A
Advances with a Contract Period of one month.
(g) On the date on which the aggregate unpaid principal amount
of Advances comprising any Borrowing shall be reduced, by payment or prepayment
or otherwise, to less than
26
Cdn.$5,000,000, such Advances shall, (i) if they are (x) Cdn. Dollar Eurodollar
Rate Advances, automatically Continue as Prime Rate Advances and (y) U.S. Dollar
Eurodollar Rate Advances, automatically Continue as Base Rate Advances, and on
and after such date the right of the Borrower to Continue such Advances as
Eurodollar Rate Advances shall terminate; provided, however, that if and so long
as each such Advance shall be, or be elected to be Continued as, Cdn. Dollar
Eurodollar Rate Advances or U.S. Dollar Eurodollar Rate Advances, as applicable,
having the same Interest Period as Eurodollar Rate Advances of the same Type
comprising another Borrowing or other Borrowings, and the aggregate unpaid
principal amount of all such Eurodollar Rate Advances of the same Type shall, or
upon such Continuation will, equal or exceed, with respect to Cdn. Dollar
Eurodollar Rate Advances, Cdn. $10,000,000 or, with respect to U.S. Dollar
Eurodollar Rate Advances, U.S.$10,000,000, the Borrower shall have the right to
Continue all such Advances as Eurodollar Rate Advances of the same Type having
such Interest Period, and (ii) if they are B/A Advances, automatically Continue
as Prime Rate Advances, and on and after such date the right of the Borrower to
Continue such Advances as B/A Advances shall terminate; provided, however, that
if and so long as each such Advance shall be, or be elected to be Continued as,
B/A Advances having the same Contract Period as B/A Advances comprising another
Borrowing or other Borrowings, and the aggregate unpaid principal amount of all
such B/A Advances shall, or upon Continuation will, equal or exceed
Cdn.$10,000,000, the Borrower shall have the right to Continue all such B/A
Advances as B/A Advances having such Contract Period.
SECTION 2.09. VOLUNTARY CONTINUATION OF ADVANCES. The Borrower
may on any Business Day, upon notice given to the Administrative Agent, not
later than the time specified in Section 2.02 for the making of an Advance of
the same Type as that of the existing Advances being Continued if such Advance
were being made on the date of the proposed Continuation, and subject to the
provisions of Section 2.08, 2.12 and 2.14, Continue all Advances of one Type
comprising the same Borrowing as Advances of another Type in the same currency;
provided, however, that any Continuation of any Eurodollar Rate Advances as
Prime Rate Advances or Base Rate Advances, as the case may be, made on any day
other than the last day of an Interest Period for such Eurodollar Rate Advances
shall be subject to the provisions of Section 9.04(b), and any Continuation of
any B/A Advances as Prime Rate Advances made on any day other than the last day
of the Contract Period for such B/A Advance shall be subject to the provisions
of Section 2.11. Each such notice of a Continuation (a "Notice of Continuation")
shall, within the restrictions specified above, specify in substantially the
form attached hereto as Exhibit B (i) the date of such Continuation, (ii) the
Advances to be Continued, (iii) if such Continuation is as Eurodollar Rate
Advances, the Type of Eurodollar Rate Advance and the duration of the Interest
Period for each such Eurodollar Rate Advance, and (iv) if such Continuation is
as B/A Advances, the duration of the Contract Period for each such B/A Advance.
SECTION 2.10. PREPAYMENTS. (a) The Borrower may prepay the
Revolving Advances or the Term Advances, provided however that the Borrower may
not prepay any Bankers' Acceptances or B/A Loans; provided, however, that the
Borrower may defease any B/A or B/A Loan by depositing with the Administrative
Agent an amount that, together with interest accruing thereon to the end of the
Contract Period or Interest Period (as applicable) therefor, is sufficient to
pay such maturing Bankers' Acceptances or B/A Loans when due. The Borrower may,
upon (i) in the case of Eurodollar Rate Advances, at least three Business Days
notice or (ii) in the case of Prime Rate Advances or Base Rate Advances,
telephonic notice not
27
later than 8:00 a.m. (Calgary local time) on the date of prepayment followed as
promptly as practicable by written notice, to the Administrative Agent which
specifies the proposed date and aggregate principal amount of the prepayment and
the Type of Advances to be prepaid, and if such notice is given the Borrower
shall, prepay the outstanding principal amounts of the Advances comprising the
same Borrowing in whole or ratably in part, together with accrued interest to
the date of such prepayment on the amount prepaid; provided, however, that (x)
each partial prepayment shall be in an aggregate principal amount not less than
Cdn.$5,000,000 or an integral multiple of Cdn.$1,000,000 in excess thereof in
the case of Prime Rate Advances and Cdn. Dollar Eurodollar Rate Advances, and
U.S.$5,000,000 or an integral multiple of U.S.$1,000,000 in excess thereof in
the case of Base Rate Advances and U.S. Dollar Eurodollar Rate Advances, and (y)
in the event of any such prepayment of Eurodollar Rate Advances on any day other
than the last day of an Interest Period for such Eurodollar Rate Advances, the
Borrower shall be obligated to reimburse the Lenders in respect thereof pursuant
to, and to the extent required by, Section 9.04(b); provided, further, however,
that the Borrower will use its best efforts to give notice to the Administrative
Agent of the proposed prepayment of Base Rate Advances on the Business Day prior
to the date of such proposed prepayment.
(b) If on any date, after giving effect to all Advances and
all repayments and prepayments to occur on such date, and based on the Exchange
Rate then in effect, the Administrative Agent determines that the aggregate Cdn.
Dollar Equivalent of the outstanding Advances hereunder shall have exceeded for
more than three consecutive Business Days an amount equal to 105% of the total
Commitments of the Lenders under the Agreement, the Administrative Agent shall
notify the Borrower of such occurrence and the Borrower shall on the next
succeeding Business Day prepay Advances in an aggregate amount sufficient to
eliminate such excess.
SECTION 2.11. BANKERS' ACCEPTANCES. (a) Subject to the terms
and conditions of this Agreement, the Borrower may request a Borrowing by
presenting drafts for acceptance and, if applicable, purchase, as B/As by the
Lenders.
(b) No Contract Period with respect to a B/A to be accepted
and, if applicable, purchased, as a Revolving Advance shall extend beyond the
Revolving Commitment Termination Date and no Contract Period with respect to a
B/A to be accepted and, if applicable, purchased, as a Term Advance shall extend
beyond the Final Maturity Date.
(c) To facilitate availment of B/A Advances, the Borrower
hereby appoints each Lender as its attorney to sign and endorse on its behalf
(in accordance with a Notice of Borrowing or Notice of Continuation relating to
a B/A Advance), in handwriting or by facsimile or mechanical signature as and
when deemed necessary by such Lender, blank forms of B/As in the form requested
by such Lender. In this respect, it is each Lender's responsibility to maintain
an adequate supply of blank forms of B/As for acceptance under this Agreement.
The Borrower recognizes and agrees that all B/As signed and/or endorsed by a
Lender on behalf of the Borrower shall bind the Borrower as fully and
effectually as if signed in the handwriting of and duly issued by the proper
signing officers of the Borrower. Each Lender is hereby authorized (in
accordance with a Notice of Borrowing or Notice of Continuation relating to a
B/A Advance) to issue such B/As endorsed in blank in such face amounts as may be
determined by such Lender; provided that the aggregate amount thereof is equal
to the aggregate amount of B/As required to
28
be accepted and purchased by such Lender. No Lender shall be liable for any
damage, loss or other claim arising by reason of any loss or improper use of any
such instrument except the gross negligence or wilful misconduct of the Lender
or its officers, employees, agents or representatives. Each Lender shall
maintain a record with respect to B/As (i) received by it in blank hereunder,
(ii) voided by it for any reason, (iii) accepted and purchased by it hereunder,
and (iv) canceled at their respective maturities. On request by or on behalf of
the Borrower, a Lender shall cancel all forms of B/As which have been pre-signed
or pre-endorsed on behalf of the Borrower and that are held by such Lender and
are not required to be issued in accordance with the Borrower's irrevocable
notice. Alternatively, the Borrower agrees that, at the request of the
Administrative Agent, the Borrower shall deliver to the Administrative Agent a
"depository note" which complies with the requirements of the Depository Bills
and Notes Act (Canada), and consents to the deposit of any such depository note
in the book-based debt clearance system maintained by the Canadian Depository
for Securities.
(d) Drafts of the Borrower to be accepted as B/As hereunder
shall be signed as set forth in this Section 2.11. Notwithstanding that any
Person whose signature appears on any B/A may no longer be an authorized
signatory for any Lender or the Borrower at the date of issuance of a B/A, such
signature shall nevertheless be valid and sufficient for all purposes as if such
authority had remained in force at the time of such issuance and any such B/A so
signed shall be binding on the Borrower.
(e) Promptly following the receipt of a Notice of Borrowing or
Notice of Continuation specifying a Borrowing or Continuation of a Borrowing by
way of B/As, the Administrative Agent shall so advise the Lenders and shall
advise each Lender of the aggregate face amount of the B/As to be accepted by it
and the applicable Contract Period (which shall be identical for all Lenders).
In the case of Advances comprised of B/A Advances, the aggregate face amount of
the B/As to be accepted by a Lender shall be in a minimum aggregate amount of
Cdn.$100,000 and shall be a whole multiple of Cdn.$100,000, and such face amount
shall be in the Lenders' pro rata portions of such Borrowing, provided that the
Administrative Agent may in its sole discretion increase or reduce any Lender's
portion of such B/A Advance to the nearest Cdn.$100,000 without reducing the
overall Commitments.
(f) The Borrower may specify in a Notice of Borrowing or
Notice of Continuation that it desires that any B/As requested by such Notice of
Borrowing or Notice of Continuation be purchased by the Lenders, in which case
the Lenders shall, upon acceptance of a B/A by a Lender, purchase, or arrange
for the purchase of, each B/A from the Borrower at the Discount Rate for such
Lender applicable to such B/A accepted by it and provide to the Administrative
Agent the Discount Proceeds for the account of the Borrower. The Acceptance Fee
payable by the Borrower to a Lender under Section 2.06(iv) in respect of each
B/A accepted by such Lender shall be set off against the Discount Proceeds
payable by such Lender under this Section 2.11.
(g) Where the Borrower so specifies in its Notice of Borrowing
or Notice of Continuation, it shall make its own arrangements for the marketing
of B/As, in which case, by subsequent notice to the Administrative Agent, it
shall provide the Administrative Agent, who shall in turn notify each Lender,
with information as to the discount proceeds payable by the purchasers of the
B/As and the party to whom delivery of the B/As by each Lender is to be made
29
against delivery to each Lender of the applicable discount proceeds, but if it
does not do so, the Borrower shall initiate a telephone call to the
Administrative Agent by 9:00 a.m. (Calgary local time) on the date of advance,
and provide such information to the Administrative Agent. Any such telephonic
advice shall be confirmed by a written notice by the Borrower to the
Administrative Agent prior to 2:00 p.m. (Calgary local time) on the same day.
(h) Each Lender may at any time and from time to time hold,
sell, rediscount or otherwise dispose of any or all B/As accepted and purchased
by it.
(i) If a Lender is not a bank listed on Schedule I, II or III
of the Bank Act (Canada) or if a Lender notifies the Administrative Agent in
writing that it is otherwise unable to accept bankers' acceptances, such Lender
shall give notice to such effect to the Administrative Agent prior to 10:00
a.m., (Calgary local time), on the date of the requested credit extension (which
notice may, if so stated therein, remain in effect with respect to subsequent
requests for extension of credit by way of Bankers' Acceptance until revoked by
notice to the Administrative Agent) and shall make available to the
Administrative Agent, in accordance with Section 2.01 hereof prior to 11:00 a.m.
(Calgary local time), on the date of such requested credit extension, a Canadian
Dollar Eurodollar Rate Advance (a "BA LOAN") in the principal amount equal to
such Lender's Commitment Percentage of the total amount of credit requested to
be extended by way of Bankers' Acceptances. Such BA Loan shall have an Interest
Period equal to the Contract Period of the Bankers' Acceptances for which it is
a substitute and shall bear interest throughout the Interest Period applicable
to such BA Loan at a rate per annum equal to the Canadian Dollar Eurodollar Rate
plus the Eurodollar Rate Margin. Subject to repayment requirements, on the last
day of the relevant Interest Period for such B/A Loan, the Borrower shall be
entitled to Continue each such B/A Loan as another Type of Advance, or to roll
over each such B/A Loan into another B/A Loan, all in accordance with the
applicable provisions of this Agreement.
(j) With respect to each B/A Advance, at or before 9:00 a.m.
(Calgary local time) two Business Days before the last day of the Contract
Period of such B/As, the Borrower shall notify the Administrative Agent by
irrevocable telephone notice, followed by a notice of rollover in substantially
the form set forth in Exhibit B hereto on the same day, if the Borrower intends
to issue B/As on such last day of the Contract Period to provide for the payment
of such maturing B/As. If the Borrower fails to notify the Administrative Agent
of its intention to issue B/As on such last day of the Contract Period, the
Borrower shall provide payment to the Administrative Agent on behalf of the
Lenders of an amount equal to the aggregate face amount of such B/As on the last
day of the Contract Period of such B/As. If the Borrower fails to make such
payment, such maturing B/As shall be deemed to have been Continued on the last
day of such Contract Period as a Prime Rate Advance in an amount equal to the
face amount of such B/As.
(k) The Borrower waives presentment for payment and any other
defense to payment of any amounts due to a Lender in respect of a B/A accepted
and purchased by it pursuant to this Agreement which might exist solely by
reason of such B/A being held, at the maturity thereof, by such Lender in its
own right, and the Borrower agrees not to claim any days of grace if such
Lender, as holder, sues the Borrower on the B/A for payment of the amount
payable by the Borrower thereunder. On the last day of the Contract Period of a
B/A, or such earlier date as may be required or permitted pursuant to the
provisions of this Agreement, the
30
Borrower shall pay the Lender that has accepted and purchased such B/A the full
face amount of such B/A and, after such payment, the Borrower shall have no
further liability in respect of such B/A and such Lender shall be entitled to
all benefits of, and be responsible for all payments due to third parties under,
such B/A.
(l) Except as required by any Lender upon the occurrence of an
Event of Default, no B/A Advance may be repaid by the Borrower prior to the
expiry date of the Contract Period applicable to such B/A Advance.
SECTION 2.12. INCREASED COSTS. (a) If, due to either (i) the
introduction after the Effective Date of, or any change after the Effective Date
(including any change by way of imposition or increase of reserve requirements
or assessments) in or in the interpretation of, any law or regulation or (ii)
the compliance with any guideline or request issued or made after the Effective
Date from or by any governmental authority (whether or not having the force of
law), (the occurrence of any of the foregoing events being herein referred to as
a "change in law") in each case above other than with respect to matters covered
by Section 2.13 or 2.16, there shall be any increase in the cost to any Lender
of agreeing to make, fund or maintain, or of making, funding or maintaining
Eurodollar Rate Advances funded in the interbank Eurodollar market, then the
Borrower shall from time to time, upon demand by such Lender (with a copy of
such demand to the Administrative Agent), pay to the Administrative Agent for
the account of such Lender additional amounts sufficient to reimburse such
Lender for all such increased costs (except those incurred more than 60 days
prior to the date of such demand; for the purposes hereof any cost or expense
allocable to a period prior to the publication or effective date of such an
introduction, change, guideline or request shall be deemed to be incurred on the
later of such publication or effective date). Each Lender agrees to use its best
reasonable efforts promptly to notify the Borrower of any event referred to in
clause (i) or (ii) above, provided that the failure to give such notice shall
not affect the rights of any Lender under this Section 2.12(a) (except as
otherwise expressly provided above in this Section 2.12(a)). A certificate as to
the amount of such increased cost, submitted to the Borrower and the
Administrative Agent by such Lender, shall be conclusive and binding for all
purposes, absent manifest error. After one or more Lenders have notified the
Borrower of any increased costs pursuant to this Section 2.12, the Borrower may
specify by notice to the Administrative Agent and the affected Lenders that,
after the date of such notice whenever the election of a Eurodollar Rate Advance
by the Borrower for an Interest Period or portion thereof would give rise to
such increased costs, such election shall not apply to the Advances of such
Lender or Lenders during such Interest Period or portion thereof, and such
Advances shall during such Interest Period or portion thereof be (x) Prime Rate
Advances in lieu of Cdn. Dollar Eurodollar Rate Advances and (y) Base Rate
Advances in lieu of U.S. Dollar Eurodollar Rate Advances. Each Lender agrees to
use its best reasonable efforts (including a reasonable effort to change its
Applicable Lending Office or to transfer its affected Advances to an Affiliate
of such Lender) to avoid, or minimize the amount of, any demand for payment from
the Borrower under this Section 2.12, provided that such avoidance would not, in
the reasonable judgment of such Lender, be otherwise disadvantageous to such
Lender.
(b) In the event that any Lender shall have determined (which
determination shall be reasonably exercised and shall, absent manifest error, be
final, conclusive and binding upon all parties) at any time that the making of
or continuance of any Advance denominated in a currency other than Cdn. Dollars
has become unlawful as a result of compliance by such Lender
31
in good faith with any applicable law, or by any applicable guideline or order
(whether or not having the force of law), or impossible as a result of the
market unavailability of such currency, then, in any such event, such Lender
shall give prompt notice (by telephone and confirmed in writing) to the Borrower
and the Administrative Agent of such determination (which notice the
Administrative Agent shall promptly transmit to the other Lenders). Upon the
giving of the notice to the Borrower and the Administrative Agent, the
Borrower's right to request (by Continuation or otherwise), and such Lender's
obligation to make, Advances denominated in a currency other than Cdn. Dollars
shall be immediately suspended, and thereafter, any requested Borrowings of
Advances denominated in a currency other than Cdn. Dollars shall, as to such
Lender only, be deemed to be a request for a Prime Rate Advance, and if the
affected Advance or Advances are still outstanding, the Borrower shall
immediately, or if permitted by applicable law, no later than the latest date
permitted thereby, upon at least one Business Days' prior written notice to the
Administrative Agent and the affected Lender, Continue each such Advance
denominated in a currency other than Cdn. Dollars as a Prime Rate Advance,
provided that if more than one Lender is affected at any time, then all affected
Lenders must be treated the same pursuant to this Section 2.12(b).
SECTION 2.13. INCREASED CAPITAL. If either (i) the
introduction of, or any change in or in the interpretation of, any law or
regulation or (ii) compliance by any Lender with any guideline or request from
any central bank or other governmental authority (whether or not having the
force of law) affects or would affect the amount of capital required or expected
to be maintained by such Lender or any corporation controlling such Lender
(including any determination after the Effective Date by any such central bank,
governmental authority or comparable agency that, for purposes of capital
adequacy requirements, the Commitments hereunder do not constitute commitments
with an original maturity of one year or less) and such Lender determines that
the amount of such capital is increased by or based upon the existence of such
Lender's commitment to lend hereunder and other commitments of this type, then,
within ten days after demand, and delivery to the Borrower of the certificate
referred to in the last sentence of this Section 2.13 by such Lender (with a
copy of such demand to the Administrative Agent), the Borrower shall pay to the
Administrative Agent for the account of such Lender, from time to time as
specified by such Lender, additional amounts sufficient to compensate such
Lender or such corporation in the light of such circumstances, to the extent
that such Lender reasonably determines such increase in capital to be allocable
to the existence of such Lender's commitment to lend hereunder (except any such
increase in capital incurred more than, or compensation attributable to the
period before, 90 days prior to the date of such demand; for the purposes hereof
any increase in capital allocable to, or compensation attributable to, a period
prior to the publication or effective date of such an introduction, change,
guideline or request shall be deemed to be incurred on the later of such
publication or effective date). Each Lender agrees to use its best reasonable
efforts promptly to notify the Borrower of any event referred to in clause (i)
or (ii) above, provided that the failure to give such notice shall not affect
the rights of any Lender under this Section 2.13 (except as otherwise expressly
provided above in this Section 2.13). A certificate in reasonable detail as to
the basis for, and the amount of, such compensation submitted to the Borrower
and the Administrative Agent by such Lender shall, in the absence of manifest
error, be conclusive and binding for all purposes.
SECTION 2.14. ILLEGALITY. Notwithstanding any other provision
of this Agreement, if the introduction of or any change in or in the
interpretation of any law or regulation shall make
32
it unlawful, or any central bank or other governmental authority shall assert
that it is unlawful, for any Lender or its Applicable Lending Office to perform
its obligations hereunder to make Eurodollar Rate Advances of a particular Type
or to continue to fund or maintain such Advances hereunder, such Lender may, by
notice to the Borrower and the Administrative Agent, suspend the right of the
Borrower to elect Eurodollar Rate Advances of such Type from such Lender and, if
necessary in the reasonable opinion of such Lender to comply with such law or
regulation, Continue all such Eurodollar Rate Advances of such Lender as Prime
Rate Advances or Base Rate Advances, as applicable, at the latest time permitted
by the applicable law or regulation, and such suspension and, if applicable,
such Continuation shall continue until such Lender notifies the Borrower and the
Administrative Agent that the circumstances making it unlawful for such Lender
to perform such obligations no longer exist (which such Lender shall promptly do
when such circumstances no longer exist). So long as the obligation of any
Lender to make Eurodollar Rate Advances of such Type has been suspended under
this Section 2.14, all Notices of Borrowing specifying Advances of such Type
shall be deemed, as to such Lender, to be requests for Prime Rate Advances or
Base Rate Advances, as applicable. Each Lender agrees to use its best reasonable
efforts (including a reasonable effort to change its Applicable Lending Office
or to transfer its affected Advances to an Affiliate) to avoid any such
illegality, provided that such avoidance would not, in the reasonable judgment
of such Lender, be otherwise disadvantageous to such Lender.
SECTION 2.15. PAYMENTS AND COMPUTATIONS. (a) The Borrower
shall make each payment hereunder (including under Section 2.03, 2.05, or 2.06)
and under the Notes, whether the amount so paid is owing to any or all of the
Lenders or to the Administrative Agent, not later than 2:00 p.m. (Calgary local
time) without set-off, counterclaim, or any other deduction whatsoever, on the
day when due in (i) Cdn. Dollars, in the case of all fees required to be paid
under Section 2.03, and all amounts payable (whether principal or interest) in
respect of Prime Rate Advances and Cdn. Dollar Eurodollar Rate Advances and all
amounts payable (including the Acceptance Fee) in respect of B/A Advances, and
(ii) in U.S. Dollars, in the case of amounts payable (whether principal or
interest) in respect of Base Rate Advances and U.S. Dollar Eurodollar Rate
Advances, to the Administrative Agent in care of its Payment Office, or at such
other location designated by notice to the Borrower from the Administrative
Agent and agreed to by the Borrower, in same day funds. Each such payment made
by the Borrower for the account of any Lender hereunder, when so made to the
Administrative Agent, shall be deemed duly made for all purposes of this
Agreement and the Notes, except that if at any time any such payment is
rescinded or must otherwise be returned by the Administrative Agent or any
Lender upon the bankruptcy, insolvency or reorganization of the Borrower or
otherwise, such payment shall be deemed not to have been so made. The
Administrative Agent will promptly thereafter cause to be distributed like funds
relating to the payment of principal or interest or fees ratably (other than
amounts payable pursuant to Section 2.12, 2.13, 2.14, 2.16, 9.04(b) or 9.04(c))
to the Lenders for the account of their respective Applicable Lending Offices,
and like funds relating to the payment of any other amount payable to any Lender
to such Lender for the account of its Applicable Lending Office, in each case to
be applied in accordance with the terms of this Agreement. Upon its acceptance
of an Assignment and Acceptance and recording of the information contained
therein in the Register pursuant to Section 9.07(d), from and after the
effective date specified in such Assignment and Acceptance, the Administrative
Agent shall make all payments hereunder and under the Notes in respect of the
interest assigned thereby to the Lender assignee thereunder, and the parties to
such Assignment and Acceptance shall make
33
all appropriate adjustments in such payments for periods prior to such effective
date directly between themselves.
(b) All computations of interest based on the Prime Rate and
under clause (i) of the definition of "Base Rate" and all computations of
Acceptance Fees (in the case of Bankers' Acceptances) and facility fees and
utilization fees (or amounts in lieu thereof) shall be made by the
Administrative Agent on the basis of a year of 365 or 366 days, as the case may
be, and all computations of interest based on the Eurodollar Rate or the
Effective Federal Funds Rate shall be made by the Administrative Agent, on the
basis of a year of 360 days, in each case for the actual number of days
(including the first day but excluding the last day) occurring in the period for
which such interest or fees are payable. Each determination by the
Administrative Agent (or, in the case of Section 2.12, 2.13, 2.14, 2.16, 9.04(b)
or 9.04(c), by each Lender with respect to its own Advances) of an interest rate
or an increased cost, loss or expense or increased capital or of illegality or
taxes hereunder shall be conclusive and binding for all purposes if made
reasonably and in good faith.
(c) Whenever any payment hereunder or under the Notes shall be
stated to be due on a day other than a Business Day, such payment shall be made
on the next succeeding Business Day, and such extension of time shall in such
case be included in the computation of payment of interest or facility fees, as
the case may be; provided, however, that except with respect to the Final
Maturity Date, if such extension would cause payment of interest on or principal
of Eurodollar Rate Advances to be made in the next following calendar month,
such payment shall be made on the next preceding Business Day.
(d) Unless the Administrative Agent shall have received notice
from the Borrower prior to the date on which any payment is due to the Lenders
hereunder that the Borrower will not make such payment in full, the
Administrative Agent may assume that the Borrower has made such payment in full
to the Administrative Agent on such date and the Administrative Agent may, in
reliance upon such assumption, cause to be distributed to each Lender on such
due date an amount equal to the amount then due such Lender. If and to the
extent the Borrower shall not have so made such payment in full to the
Administrative Agent, each Lender shall repay to the Administrative Agent
forthwith on demand such amount distributed to such Lender together with
interest thereon, for each day from the date such amount is distributed to such
Lender until the date such Lender repays such amount to the Administrative
Agent, at a rate equal to the Prime Rate for such day.
SECTION 2.16. TAXES. (a) Any and all payments by the Borrower
or the Parent hereunder or under the Notes shall be made in accordance with
Section 2.15, free and clear of and without deduction for any and all present or
future taxes, levies, imposts, deductions, charges or withholdings, and all
liabilities with respect thereto, imposed or levied by or on behalf of the
Government of Canada or of any province or territory thereof or by any authority
or agency therein or thereof having power to tax (hereinafter "CANADIAN TAXES"),
unless the Borrower is required to withhold or deduct Canadian Taxes by law or
by the interpretation or administration thereof. If the Borrower is so required
to withhold or deduct any amount for or on account of Canadian Taxes from any
payment made under or with respect to this Agreement or the Notes, the Borrower
will pay to each Indemnified Party as additional interest such additional
amounts as may be necessary so that the net amount received by each Indemnified
Party after such
34
withholding or deduction (and after deducting any Canadian Taxes on such
additional amounts) will not be less than the amount the Indemnified Party would
have received if such Canadian Taxes had not been withheld or deducted. No
additional amounts will be payable with respect to a payment made to an
Indemnified Party under this Section 2.16(a) where such Indemnified Party (i) is
subject to Canadian Taxes by reason of the Indemnified Party being a resident,
domicile or national of, or engaging in business or maintaining a permanent
establishment or other physical presence in or otherwise having some connection
with Canada or any province or territory thereof otherwise than by the mere
making or holding of the Notes or by the receipt of payments thereunder, or (ii)
is subject to Canadian Taxes by reason of its failure to comply with Section
2.16(g), provided, that should an Indemnified Party become subject to Canadian
Taxes because of its failure to deliver a form required hereunder, the Borrower
or the Parent shall take such administrative steps as such Indemnified Party
shall reasonably request to assist such Indemnified Party to recover such
Canadian Taxes, and provided further, that each Indemnified Party, with respect
to itself, agrees to indemnify and hold harmless the Borrower and the Parent
from any Canadian Taxes, penalties, interest and other expenses, costs and
losses incurred or payable by the Borrower or the Parent as a result of the
failure of the Borrower or the Parent to comply with its obligations under this
Section 2.16(a) in reliance on any form or certificate provided to it by such
Indemnified Party pursuant to this Section 2.16. The Borrower will also make
such withholdings or deductions and remit the full amount deducted or withheld
to the relevant authority in accordance with applicable law.
(b) Any and all payments by the Parent (or by the Borrower to
the extent the Borrower causes a payment to be made from any jurisdiction other
than Canada) hereunder or under the Notes shall be made in accordance with
Section 2.15, free and clear of and without deduction for any and all present or
future taxes, levies, imposts, deductions, charges or withholdings, and all
liabilities with respect thereto imposed or levied by or on behalf of any
jurisdiction outside Canada, excluding in the case of each Indemnified Party all
taxes, levies, imposts, deductions, charges, or withholdings, and all
liabilities with respect thereto, imposed on or determined by reference to its
income or profits, and all franchise taxes and all other taxes, levies, imposts,
deductions, charges or withholdings in effect at the time that such Indemnified
Party executed this Agreement or otherwise became an "Indemnified Party"
hereunder, and liabilities with respect thereto, imposed on it by reason of the
jurisdiction in which such Indemnified Party is organized, domiciled, resident
or doing business, or any political subdivision thereof, or by reason of the
jurisdiction of its Applicable Lending Office or any other office from which it
makes or maintains any extension of credit hereunder or any political
subdivision thereof (all such non-excluded taxes, levies, imposts, deductions,
charges, withholdings and liabilities in respect of payments under this
Agreement or under the Notes being herein referred to as "NON-CANADIAN TAXES"
and, together with Canadian Taxes, "TAXES"). If the Parent (or the Borrower, as
applicable) shall be required by law to deduct any Non-Canadian Taxes from or in
respect of any sum payable by it hereunder or under any Note to any Indemnified
Party, (i) the sum payable by it shall be increased as may be necessary so that
after making all required deductions (including deductions applicable to
additional sums payable under this Section 2.16) such Indemnified Party receives
an amount equal to the sum it would have received had no such deductions been
made, (ii) the Parent (in the case of payments by it) (or Borrower (in the case
of payments by it) or the Administrative Agent, as applicable) shall make such
deductions at the applicable statutory rate and (iii) the Parent (in the case of
payments by it) (or the Borrower (in the case of payments by it) or the
Administrative Agent, as applicable)
35
shall pay the full amount deducted to the relevant taxation authority or other
authority in accordance with applicable law, provided that the Parent shall not
be required to pay any additional amount (and shall be relieved of any liability
with respect thereto) pursuant to this subsection (b) (or pursuant to Section
2.16(e), except to the extent Section 2.16(e) relates to Other Taxes) to any
Indemnified Party that has failed to submit any form or certificate that it was
required to file or provide pursuant to Section 2.16(f) and is entitled to file
or give, as applicable, under applicable law, provided, further, that should an
Indemnified Party become subject to Non-Canadian Taxes because of its failure to
deliver a form required hereunder, the Parent shall take such administrative
steps as such Indemnified Party shall reasonably request to assist such
Indemnified Party to recover such Non-Canadian Taxes, and provided further, that
each Indemnified Party, with respect to itself, agrees to indemnify and hold
harmless the Parent from any taxes, penalties, interest and other expenses,
costs and losses incurred or payable by the Parent as a result of the failure of
the Parent to comply with its obligations under clauses (ii) or (iii) above in
reliance on any form or certificate provided to it by such Indemnified Party
pursuant to this Section 2.16.
(c) If any Indemnified Party receives a net credit or refund
in respect of Taxes or amounts paid pursuant to this Section 2.16 by the
Borrower or the Parent, it shall promptly notify the Borrower or the Parent of
such net credit or refund and shall promptly pay such net credit or refund to
the Borrower or the Parent, provided that the Borrower and the Parent agree to
return such net credit or refund if the Indemnified Party to which such net
credit or refund is applicable is required to repay it.
(d) In addition, the Parent and the Borrower agree to pay any
present or future stamp or documentary taxes or any other excise or property
taxes, charges or similar levies which arise from any payment made hereunder or
under the Notes or from the execution, delivery or registration of, or otherwise
with respect to, this Agreement or the Notes (hereinafter referred to as "OTHER
TAXES").
(e) The Borrower or the Parent will indemnify each Indemnified
Party for the full amount of Taxes or Other Taxes (including any Taxes or Other
Taxes imposed by any jurisdiction on amounts payable under this Section 2.16 but
excluding Canadian Taxes to the extent that such Indemnified Party is described
in either Section 2.16(a)(i) or (ii) hereof) paid by such Indemnified Party and
any liability (including penalties, interest and expenses) arising therefrom or
with respect thereto except as a result of the gross negligence (which shall in
any event include the failure of such Indemnified Party to provide any form or
certificate that it was required to provide either to the Borrower pursuant to
subsection (g) below or to the Parent pursuant to either subsection (f) or (g)
below) or willful misconduct of such Indemnified Party, whether or not such
Taxes or Other Taxes were correctly or legally asserted. This indemnification
shall be made within 30 days from the date such Indemnified Party makes written
demand therefor.
(f) On or prior to the date on which each Indemnified Party
that is not a United States person (as such term is defined in Section
7701(a)(30) of the Internal Revenue Code) executes this Agreement or otherwise
becomes an "Indemnified Party" hereunder, such Indemnified Party shall provide
the Parent and the Administrative Agent with U.S. Internal Revenue Service form
W-8BEN or W-8ECI, as appropriate, or any successor form prescribed by
36
the U.S. Internal Revenue Service, certifying, if it is entitled to so certify,
that such Indemnified Party is fully exempt from United States withholding taxes
with respect to all payments to be made to such Indemnified Party hereunder, or
other documents satisfactory to the Parent indicating that all payments to be
made to such Indemnified Party hereunder are fully exempt from such taxes, if
such is the case. Thereafter and from time to time, each such Indemnified Party
shall submit to the Parent and the Administrative Agent such additional duly
completed and signed copies of one or the other of such forms (or such successor
forms as shall be adopted from time to time by the relevant United States taxing
authorities) as may be (i) notified by the Parent to such Indemnified Party and
(ii) required under then-current United States law or regulations to avoid
United States withholding taxes on payments in respect of all amounts to be
received by such Indemnified Party hereunder or under the Notes, including fees,
if the particular Indemnified Party is eligible for such exemption. Upon the
request of the Parent from time to time, each Indemnified Party that is a United
States person (as such term is defined in Section 7701(a)(30) of the Internal
Revenue Code) shall submit to the Parent a certificate to the effect that it is
such a United States person. If any Indemnified Party determines that it is not
fully exempt from United States withholding taxes with respect to all payments
to be received hereunder and is therefore unable to submit to the Parent any
form or certificate that such Indemnified Party would otherwise be obligated to
submit pursuant to this subsection (f), or that such Indemnified Party is
required to withdraw or cancel any such form or certificate previously submitted
because it is no longer entitled to such an exemption, such Indemnified Party
shall promptly notify the Parent and the Administrative Agent of such fact.
(g) In the event that, as a result of a Change in Law, Canada
or any political subdivision thereof introduces certification, identification,
information, documentation or other reporting requirements which require
compliance by an Indemnified Party as a pre-condition to an exemption from
withholding on Canadian Taxes for any payment made from Canada by the Borrower
or the Parent, hereunder or under the Notes (the "CANADIAN CERTIFICATION
REQUIREMENTS"), then such Indemnified Party shall provide the Parent, the
Borrower and the Administrative Agent with any applicable forms, certificates or
other documentation, as appropriate and as prescribed by the appropriate
Canadian governmental authority, certifying, if it is entitled to so certify,
that such Indemnified Party is so exempt from Canadian withholding taxes with
respect to payments to be made to such Indemnified Party, if such is the case.
Thereafter and from time to time, each such Indemnified Party shall submit to
the Parent, the Borrower and the Administrative Agent such additional duly
completed and signed copies of one or the other of such forms, certificates or
other documentation as may be notified by the Parent or by the Borrower to such
Indemnified Party and required under then-current Canadian law or regulations
(or the law or regulations of any political subdivision of Canada, if
applicable) to avoid Canadian withholding taxes on payments in respect of all
amounts to be received by such Indemnified Party pursuant to this Agreement or
the Notes, including fees, if the particular Indemnified Party is eligible for
such exemption. If any Indemnified Party determines that it is not exempt from
Canadian withholding taxes with respect to all payments to be received hereunder
and is therefore unable to submit to the Parent, the Borrower or the
Administrative Agent any form, certificate or other documentation that such
Indemnified Party would otherwise be obligated to submit pursuant to this
subsection (g), or that such Indemnified Party is required to withdraw or cancel
any such form, certificate or documentation previously submitted because it is
no longer entitled to such an exemption, then such Indemnified Party shall
promptly notify the Parent, the Borrower and the Administrative Agent of such
fact. The Borrower and the Parent
37
acknowledge that no such Canadian Certification Requirements currently exist
under Canadian law. The obligations of each Indemnified Party under this Section
2.16(g) shall not be effective with respect to such Indemnified Party unless and
until either the Parent, the Borrower or the Administrative Agent provides
written notice to such Indemnified Party of any such Canadian Certification
Requirements and extends to such Indemnified Party a reasonable amount of time,
not to exceed 30 days, to comply with any such requirements.
(h) Any Indemnified Party claiming any additional amounts
payable pursuant to this Section 2.16 shall use its best reasonable efforts
(consistent with its internal policy and legal and regulatory restrictions) to
change the jurisdiction of its Applicable Lending Office if the making of such a
change would avoid the need for, or reduce the amount of, any such additional
amounts which may thereafter accrue and would not, in the reasonable judgment of
such Indemnified Party, be otherwise disadvantageous to such Indemnified Party.
(i) Without prejudice to the survival of any other agreement
of the Borrower and the Parent hereunder, the agreements and obligations of the
Borrower, the Parent and each Indemnified Party contained in this Section 2.16
shall survive the payment in full of principal and interest hereunder and under
the Notes.
SECTION 2.17. SHARING OF PAYMENTS, ETC. If any Lender shall
obtain any payment (whether voluntary, involuntary, through the exercise of any
right of set-off, or otherwise) on account of the Advances made by it (other
than pursuant to Section 2.12, 2.13, 2.14, 2.16, 9.04(b) or 9.04(c)) in excess
of its ratable share of payments on account of the Advances obtained by all the
Lenders, such Lender shall forthwith purchase from the other Lenders such
participations in the Advances made by them as shall be necessary to cause such
purchasing Lender to share the excess payment ratably with each of them,
provided, however, that if all or any portion of such excess payment is
thereafter recovered from such purchasing Lender, such purchase from each Lender
shall be rescinded and each Lender shall repay to the purchasing Lender the
purchase price to the extent of such Lender's ratable share (according to the
proportion of (i) the amount of the participation purchased from such Lender as
a result of such excess payment to (ii) the total amount of such excess payment)
of such recovery together with an amount equal to such Lender's ratable share
(according to the proportion of (A) the amount of such Lender's required
repayment to (B) the total amount so recovered from the purchasing Lender) of
any interest or other amount paid or payable by the purchasing Lender in respect
of the total amount so recovered. The Borrower agrees that any Lender so
purchasing a participation from another Lender pursuant to this Section may, to
the fullest extent permitted by law, exercise all its rights of payment
(including the right of set-off) with respect to such participation as fully as
if such Lender were the direct creditor of the Borrower in the amount of such
participation.
SECTION 2.18. EVIDENCE OF DEBT. (a) Each Lender shall maintain
in accordance with its usual practice an account or accounts evidencing the
Indebtedness of the Borrower to such Lender resulting from each Advance made by
such Lender hereunder, including the amounts of principal and interest payable
and paid to such lender from time to time hereunder.
(b) The Administrative Agent shall maintain accounts and
records in which it shall record (i) the amount of each Advance made hereunder,
the type of Advance and, in the
38
cases of B/A Advances and Eurodollar Rate Advances, the relevant Contract Period
or Interest Period applicable thereto, (ii) the amount of any principal or
interest due and payable or to become due and payable from the Borrower to each
Lender hereunder, and (iii) the amount of any sum received by the Administrative
Agent hereunder for the account of the Lenders and each Lender's share thereof.
(c) The entries made in the accounts maintained pursuant to
Sections 2.18(a) and (b) shall be conclusive evidence (absent manifest error) of
the existence and amounts of the obligations recorded therein; provided that the
failure of any Lender or the Administrative Agent to maintain such accounts or
any error therein shall not in any manner affect the obligation of the Borrower
to repay the Advances in accordance with the terms of this Agreement. In the
event of a conflict between the records maintained by the Administrative Agent
and any Lender, the records maintained by the Lender shall govern. Any Lender
may request that Loans (other than B/As) made by it be evidenced by a Note. In
such event, the Borrower shall prepare, execute and deliver to such Lender a
Note payable to the order of such Lender (or, if requested by such Lender, to
such Lender and its registered assigns) and substantially in the form attached
as Exhibit A hereto. Thereafter, the Loans evidenced by such Note and interest
thereon shall at all times (including after assignment pursuant to Section 9.07)
be represented by one or more Notes in such form payable to the order of the
payee named therein (or, if such Note is a registered Note, to such payee and
its registered assigns).
SECTION 2.19. USE OF PROCEEDS. Proceeds of the Advances may be
used for general corporate purposes of the Borrower and its Subsidiaries and of
Parent and any of its other Subsidiaries, including for acquisitions and for
payment of commercial paper issued by the Borrower or any such other Person.
SECTION 2.20. INCREASE OF COMMITMENTS. (a) At any time after
the Effective Date, provided that no Event of Default shall have occurred and be
continuing, the Borrower may request an increase of the aggregate Commitments by
notice to the Administrative Agent in writing of the amount (the "Offered
Increase Amount") of such proposed increase (such notice, a "Commitment Increase
Notice"). Any such Commitment Increase Notice must offer each Lender the
opportunity to subscribe for its pro rata share of the increased Commitments. If
any portion of the increased Commitments is not subscribed for by the Lenders,
the Borrower may, in its sole discretion, but with the consent of the
Administrative Agent as to any Person that is not at such time a Lender (which
consent shall not be unreasonably withheld), offer to any existing Lender or to
one or more additional banks or financial institutions the opportunity to
participate in all or a portion of such unsubscribed portion of the increased
Commitments pursuant to paragraph (b) or (c) below, as applicable.
(b) Any additional bank or financial institution that the
Borrower selects to offer participation in the increased Commitments, and that
elects to become a party to this Agreement and obtain a Commitment, shall
execute a New Lender Agreement with the Borrower and the Administrative Agent,
substantially in the form of Exhibit E (a "NEW LENDER AGREEMENT"), whereupon
such bank or financial institution (a "NEW LENDER") shall become a Lender for
all purposes and to the same extent as if originally a party hereto and shall be
bound by and entitled to the benefits of this Agreement, and the signature pages
and Schedule III hereof shall be deemed to be amended to add the name and
Commitment of such New Lender, provided
39
that the Commitment of any such New Lender shall be in an amount not less than
Cdn.$5,000,000.
(c) Any Lender that accepts an offer to it by the Borrower to
increase its Commitment pursuant to this Section 2.20 shall, in each case,
execute a Commitment Increase Agreement with the Borrower and the Administrative
Agent, substantially in the form of Exhibit F (a "COMMITMENT INCREASE
AGREEMENT"), whereupon such Lender shall be bound by and entitled to the
benefits of this Agreement with respect to the full amount of its Commitment as
so increased, and Schedule III hereof shall be deemed to be amended to so
increase the Commitment of such Lender.
(d) The effectiveness of any New Lender Agreement or
Commitment Increase Agreement shall be contingent upon receipt by the
Administrative Agent of such corporate resolutions of the Borrower and legal
opinions of counsel to the Borrower as the Administrative Agent shall reasonably
request with respect thereto, in each case, in form and substance satisfactory
to the Administrative Agent.
(e) If any bank or financial institution becomes a New Lender
pursuant to Section 2.20(b) or any Lender's Commitment is increased pursuant to
Section 2.20(c), additional Advances made on or after the effectiveness thereof
(the "RE-ALLOCATION DATE") shall be made pro rata based on the Commitment
Percentages in effect on and after such Re-Allocation Date (except to the extent
that any such pro rata borrowings would result in any Lender making an aggregate
principal amount of Advances in excess of its Commitment, in which case such
excess amount will be allocated to, and made by, such New Lender and/or Lenders
with such increased Commitments to the extent of, and pro rata based on, their
respective Commitments), and continuations of Eurodollar Rate Advances
outstanding on such Re-Allocation Date shall be effected by repayment of such
Eurodollar Rate Advances on the last day of the Interest Period applicable
thereto and the making of new Eurodollar Rate Advances pro rata based on such
new Commitment Percentages. In the event that on any such Re-Allocation Date
there is an unpaid principal amount of Prime Rate Advances or Base Rate
Advances, the existing Lenders shall be deemed to have made partial assignments
thereof to the New Lenders and/or Lenders with such increased Commitments in
such amounts that, after giving effect thereto, the Prime Rate Advances and Base
Rate Advances outstanding are held pro rata based on such new Commitment
Percentages. In the event that on any such Re-Allocation Date there is an unpaid
principal amount of Eurodollar Rate Advances, such Eurodollar Rate Advances
shall remain outstanding with the respective holders thereof until the
expiration of their respective Interest Periods (unless the applicable Borrower
elects to prepay any thereof in accordance with the applicable provisions of
this Agreement), and interest on and repayments of such Eurodollar Rate Advances
will be paid thereon to the respective Lenders holding such Eurodollar Rate
Advances pro rata based on the respective principal amounts thereof outstanding.
In the event that on any such Re-Allocation Date there is an unpaid principal
amount of B/A Advances, such B/A Advances shall remain outstanding with the
respective holders thereof until the expiration of their respective Contract
Periods, and repayments of such B/A Advances will be paid thereon to the
respective Lenders holding such B/As based on the respective face amounts
thereof.
(f) Notwithstanding anything to the contrary in this Section
2.20, (i) no increase pursuant to this Section 2.20 shall be effective without
the consent of the Required
40
Lenders, (ii) no Lender shall have any obligation to increase its Commitment
unless it agrees to do so in its sole discretion and (iii) the aggregate amount
by which the Commitments hereunder are increased pursuant to this Section 2.20
shall not exceed Cdn.$141,426,000.
(g) The Borrower shall execute and deliver a Note to each new
bank or other financial institution becoming a Lender that requests one.
SECTION 2.21. EXTENSION OF REVOLVING COMMITMENT TERMINATION
DATE. (a) Not earlier than 65 days prior to and not later than 45 days prior to
the Revolving Commitment Termination Date then in effect, provided that no Event
of Default shall have occurred and be continuing, the Borrower may request an
extension of such Revolving Commitment Termination Date by submitting to the
Administrative Agent an Extension Request containing the information in respect
of such extension specified in Exhibit G, which the Administrative Agent shall
promptly furnish to each Lender. Each Lender shall, by the later of (i) the date
30 days after its receipt from the Administrative Agent of the applicable
Extension Request and (ii) the date 30 days prior to the Revolving Commitment
Termination Date, notify the Borrower and the Administrative Agent of its
consent to extend or its refusal to extend the Revolving Commitment Termination
Date as requested in such Extension Request. Any such Extension Request shall be
approved if the Required Lenders shall approve in writing the extension of the
Revolving Commitment Termination Date requested in such Extension Request. The
Borrower may request no more than ten extensions pursuant to this Section 2.21,
so that the Revolving Commitment Termination Date shall not in any event extend
beyond the tenth anniversary of the initial Revolving Commitment Termination
Date hereunder. The Administrative Agent shall promptly notify the Lenders and
the Borrower of any extension of the Revolving Commitment Termination Date
pursuant to this Section 2.21 and shall promptly notify the Borrower of any
Lender that has notified the Administrative Agent of its consent to extend or
its refusal to extend the Revolving Commitment Termination Date.
(b) If any such Extension Request is approved but there are
one or more Lenders that do not consent to the Extension Request in writing
within the period specified in paragraph (a) above (an "Objecting Lender"), the
Borrower shall be entitled to choose any of the following options prior to the
Revolving Commitment Termination Date, provided that if the Borrower does not
make an election prior to such date, the Borrower shall be deemed to have
irrevocably elected to exercise the option in clause (iii)(y) below:
(i) the Borrower may elect to cause the Commitments and
Advances of any Objecting Lender to be transferred or assigned pursuant
to Section 2.21(c); and/or
(ii) the Borrower may elect to voluntarily prepay the
Advances, if any, of Objecting Lenders together with accrued interest
thereon, any amounts payable pursuant to Sections 2.06, 2.12, 2.13,
2.16 and 9.04(b) and any accrued and unpaid facility fee or utilization
fee or other amounts payable with respect to such Objecting Lenders,
and the Commitments of such Objecting Lenders shall be terminated; or
(iii) the Borrower may elect to revoke and cancel the
Extension Request by giving notice of such revocation and cancellation
to the Administrative Agent (which shall promptly notify the Lenders
thereof) and concurrently therewith shall have the
41
option to (x) voluntarily prepay the Advances, if any, of all Lenders,
together with accrued interest thereon, any amounts payable pursuant to
Sections 2.06, 2.12, 2.13, 2.16 and 9.04(b) and any accrued and unpaid
facility fee or utilization fee or other amounts payable with respect
to the Lenders, and the Commitments of all Lenders shall be terminated
or (y) have the outstanding Advances continue as term loans repayable
in accordance with paragraphs (a), (b), (c) and (d) of Section 2.05 of
this Agreement.
(c) If any Lender becomes an Objecting Lender, the Borrower
may, at its own expense and in its sole discretion and prior to the then
Revolving Commitment Termination Date, require such Lender to transfer or
assign, without recourse (in accordance with Section 8.07), all of its
interests, rights and obligations under this Agreement and, if the Borrower
shall so determine in its sole discretion, all or part of its interest, rights
and obligations under the U.S. Long-Term Revolving Credit Agreement and/or the
U.S. Short-Term Revolving Credit Agreement, as the case may be) to an Eligible
Assignee (provided that the Borrower, with the full cooperation of such Lender,
can identify an Eligible Assignee that is ready, willing and able to be an
assignee with respect thereto) which shall assume such assigned obligations
(which assignee may be another Lender, if such assignee Lender accepts such
assignment); provided that (A) the assignee or the Borrower, as the case may be,
shall have paid to such Lender in immediately available funds the principal of
and interest accrued to the date of such payment on the Advances made by it
hereunder and the "Advances" made by it under, and as defined in, the U.S.
Long-Term Revolving Credit Agreement or the U.S. Short-Term Revolving Credit
Agreement, as the case may be, and all other amounts owed to it hereunder and
thereunder, including any amounts owing pursuant to Section 9.04(b) (or the
comparable provision of the U.S. Long-Term Revolving Credit Agreement or the
U.S. Short-Term Revolving Credit Agreement, as the case may be) and any amounts
that would be owing under such Section (or comparable provision) if such
Advances and "Advances" (as so defined) were prepaid on the date of such
assignment, and (B) such assignment does not conflict with any law, rule or
regulation or order of any governmental authority. Any assignee that becomes a
Lender as a result of such an assignment made pursuant to this paragraph (b)
shall be deemed to have consented to the applicable Extension Request and,
therefore, shall not be an Objecting Lender.
SECTION 2.22. REPLACEMENT OF LENDERS. If any Lender requests
compensation under Sections 2.11 or 2.13 or if the Borrower is required to pay
any additional amount to any Lender or any taxing authority or other authority
for the account of any Lender pursuant to Section 2.16, or if any Lender
suspends the right of the Borrower to elect Eurodollar Rate Advances from such
Lender pursuant to Section 2.14, or if any Lender defaults in its obligation to
fund Advances hereunder, then the Borrower may, at its sole expense and effort,
upon notice to such Lender and the Administrative Agent, require such Lender to
assign and delegate, without recourse (in accordance with and subject to the
restrictions contained in Section 9.07), all its interests, rights and
obligations under this Agreement and, if the Borrower shall so determine in its
sole discretion, the U.S. Long-Term Revolving Credit Agreement and/or the U.S.
Short-Term Revolving Credit Agreement, as the Borrower may determine in its sole
discretion and specify by notice to such Lender, (other than "B Advances" under,
and as defined in, the U.S. Long-Term Revolving Credit Agreement and/or the U.S.
Short-Term Revolving Credit Agreement, as the case may be) to an assignee that
shall assume such obligations (which assignee may be another Lender, if a Lender
accepts such assignment); provided that (i) the Borrower shall have received the
prior written consent of the Administrative Agent, which
42
consent shall not unreasonably be withheld, (ii) such Lender shall have received
payment of an amount equal to the outstanding principal of its Advances
hereunder and, if the Borrower shall have so determined as specified above, its
"Advances" (other than "B Advances") (each under and as defined in the U.S.
Long-Term Revolving Credit Agreement and/or the U.S. Short-Term Revolving Credit
Agreement, as the case may be), and all accrued interest thereon, accrued fees,
accrued costs in connection with compensation under Sections 2.12 or 2.13 or
payments required to be made pursuant to Section 2.16, if any, and all other
amounts (other than "B Advances") payable to it hereunder and, if the Borrower
shall have so determined as specified above, under the U.S. Long-Term Revolving
Credit Agreement and/or the U.S. Short-Term Revolving Credit Agreement, as the
case may be, from the assignee (to the extent of such outstanding principal and
accrued interest and fees) or the Borrower (in the case of all other amounts)
and (iii) in the case of any such assignment resulting from a claim for
compensation under Sections 2.12 or 2.13 or payments required to be made
pursuant to Section 2.16, such assignment will result in a reduction in such
compensation or payments. A Lender shall not be required to make any such
assignment and delegation if, prior thereto, as a result of a waiver by such
Lender or otherwise, the circumstances entitling the Borrower to require such
assignment and delegation cease to apply.
SECTION 2.23. CURRENCY INDEMNITY. If, for the purposes of
obtaining judgment in any court in any jurisdiction with respect to this
Agreement or any other Financing Document, it becomes necessary to convert into
the currency of such jurisdiction (the "Judgment Currency") any amount due under
this Agreement or under any other Financing Document in any currency other than
the Judgment Currency (the "Currency Due"), then conversion shall be made at the
rate of exchange prevailing on the Business Day before the day on which the
judgment is given. For this purpose, "rate of exchange" means the rate at which
the Administrative Agent is able, on the relevant date, to purchase the Currency
Due with the Judgment Currency in accordance with its normal practice at its
head office in Toronto, Ontario. In the event that there is a change in the rate
of exchange prevailing between the Business Day before the day on which the
judgment is given and the date of receipt by the Administrative Agent of the
amount due, the Borrower will, on the date of receipt by the Administrative
Agent, pay such additional amounts, if any, or be entitled to obtain
reimbursement of such amount, if any, as may be necessary to ensure that the
amount received by the Administrative Agent on such date is the amount in the
Judgment Currency which when converted at the rate of exchange prevailing on the
date of receipt by the Administrative Agent is the amount then due under this
Agreement or under such other Financing Document in the Currency Due. If the
amount of the Currency Due which the Administrative Agent is so able to purchase
is less than the amount of the Currency Due originally due to it, the Borrower
shall indemnify and save the Administrative Agent and the Lenders harmless from
and against all loss or damage arising as a result of such deficiency. This
indemnity shall constitute an obligation separate and independent from the other
obligations contained in this Agreement and the other Financing Documents, shall
give rise to a separate and independent cause of action, shall apply
irrespective of any indulgence granted by the Administrative Agent from time to
time and shall continue in full force and effect notwithstanding any judgment or
order for a liquidated sum in respect of an amount due under this Agreement or
any other Financing Document or under any judgment or order.
SECTION 2.24. EXCHANGE RATE CALCULATIONS. (a) Not later than
12:00 noon, Calgary local time, on each Calculation Date, the Administrative
Agent shall (i) determine the
43
Exchange Rate as of such Calculation Date and (ii) give notice thereof to the
Borrower and to each Lender that shall have requested such information. The
Exchange Rates so determined shall become effective on the first Business Day
immediately following the relevant Calculation Date (each, a "Reset Date") and
shall remain effective until the next succeeding Reset Date.
(b) Not later than 12:00 noon, Calgary local time, on each
Reset Date, the Administrative Agent shall (i) determine the Cdn.$ Equivalent of
the Advances outstanding on such date, or to be outstanding after giving effect
to any Borrowing to occur on such date, and (ii) notify the Borrower and each
Lender that shall have requested such information of the aggregate outstanding
Advances, based on information provided by the Borrower after giving effect to
all Advances and all repayments and prepayments to occur on such date.
ARTICLE 3
CONDITIONS OF EFFECTIVENESS AND LENDING
SECTION 3.01. CONDITIONS PRECEDENT TO EFFECTIVENESS OF THIS
AGREEMENT. This Agreement shall become effective when (i) it shall have been
executed by the Borrower, Parent and the Administrative Agent, (ii) the
Administrative Agent and the Borrower either shall have been notified by each
Initial Lender that such Initial Lender has executed it or shall have received a
counterpart of this Agreement executed by such Initial Lender, and (iii) the
Administrative Agent shall have received the following, each dated the date of
delivery thereof unless otherwise specified below (which date shall be selected
by the Borrower and be the same for all documents and all Lenders), in form and
substance satisfactory to the Administrative Agent and (except for the Notes, if
any) in sufficient copies for each Lender:
(a) the Notes, to the order of the Lenders requesting Notes,
respectively;
(b) certified copies of the resolutions of the directors of
the Borrower and the Board of Directors of Parent, approving (as appropriate)
the Borrowings contemplated hereby and authorizing the execution of this
Agreement and the other Financing Documents, including the Notes, if any, and of
all documents evidencing other necessary corporate action and governmental
approvals, if any, with respect to this Agreement and any other Financing
Documents;
(c) a certificate of the Secretary or an Assistant Secretary
of the Borrower and Parent (i) certifying names and true signatures of officers
of such Person authorized to sign this Agreement, the Notes, if any, and any
other Financing Documents to which it is a party and (ii) if the Effective Date
is other than the date of this amendment and restatement, certifying that the
representations and warranties contained in Section 4.01 are true and correct as
of the Effective Date;
(d) Evidence of the effectiveness of the amendment and
restatement of each of the U.S. Short-Term Revolving Credit Agreement and the
U.S. Long-Term Revolving Credit Agreement;
44
(e) A favorable opinion of Parent's Vice President and General
Counsel in substantially the form of Exhibit H-1 hereto;
(f) A favorable opinion of Joanne Alexander, counsel for the
Borrower, in substantially the form of Exhibit H-2 hereto;
(g) A favorable opinion of Bennett Jones LLP, Alberta counsel
to the Borrower, in substantially the form of Exhibit I hereto; and
(h) The Administrative Agent, the Lenders and the Arranger
shall have received all fees and other amounts due and payable on or prior to
the Effective Date, including, to the extent invoiced, reimbursement or payment
of all legal fees and other out-of-pocket expenses required to be reimbursed or
paid by the Borrower hereunder.
The Borrower and the Initial Lenders agree that upon the
Effective Date the "Commitments" of the Initial Lenders shall be as set forth on
Schedule III hereof under the caption "Commitments".
SECTION 3.02. CONDITIONS PRECEDENT TO EACH BORROWING. The
obligation of each Lender to make an Advance (including the initial Advance) on
the occasion of any Borrowing shall be subject to the further conditions
precedent that on or before the date of such Borrowing this Agreement shall have
become effective pursuant to Section 3.01 and that on the date of such
Borrowing, before and immediately after giving effect to such Borrowing and to
the application of the proceeds therefrom, the following statements shall be
true and correct, and the giving by the Borrower of the applicable Notice of
Borrowing and the acceptance by the Borrower of the proceeds of such Borrowing
shall constitute its representation and warranty that on and as of the date of
such Borrowing, before and immediately after giving effect thereto and to the
application of the proceeds therefrom, the following statements are true and
correct:
(a) each representation and warranty contained in Section 4.01
is correct in all material respects as though made on and as of such date (or,
if such representation and warranty is stated to be made as at a specific date
or for a specific period, as at the original specified date or with respect to
the original specified period);
(b) no event has occurred and is continuing, or would result
from such Borrowing, which constitutes an Event of Default or would constitute
an Event of Default but for the requirement that notice be given or time elapse
or both; and
(c) the aggregate amount of the borrowings under this
Agreement (including such Borrowing) and under other agreements or facilities or
evidenced by other instruments or documents is not in excess of the aggregate
amount of such borrowings approved as of such date (to the extent any such limit
on aggregate borrowings exists from time to time) by the sole shareholder of the
Borrower and the Board of Directors of Parent.
45
ARTICLE 4
REPRESENTATIONS AND WARRANTIES
SECTION 4.01. REPRESENTATIONS AND WARRANTIES OF THE BORROWER.
Each of the Borrower and Parent represents and warrants as follows:
(a) The Borrower is a corporation duly amalgamated, validly
existing and in good standing under the laws of the Province of Alberta. The
Parent is a corporation duly incorporated, validly existing and in good standing
under the laws of the State of Delaware. Each Material Subsidiary is duly
incorporated, validly existing and in good standing in the jurisdiction of its
incorporation. Parent and each Material Subsidiary possess all corporate powers
and all other authorizations and licenses necessary to engage in its business
and operations as now conducted, the failure to obtain or maintain which would
have a Material Adverse Effect. Each Subsidiary of Parent that is, on and as of
the Effective Date, a Material Subsidiary is listed on Schedule I hereto.
(b) The Transactions are within the corporate powers of the
Borrower and Parent (as applicable), have been duly authorized by all necessary
corporate action, and do not contravene (i) the charter or certificate of
incorporation (as applicable) or by-laws of the Borrower or the Parent (as
applicable) or (ii) law or any contractual restriction binding on or affecting
the Borrower or the Parent. This Agreement, the Notes, if any, and the other
Financing Documents, if any, have been duly executed and delivered by the
Borrower and the Parent (as applicable).
(c) The Transactions do not require any authorization or
approval or other action by, nor any notice to or filing with, any governmental
authority or regulatory body for the due execution, delivery and performance by
the Borrower and the Parent (as applicable) of this Agreement, the Notes, if
any, or the other Financing Documents, if any, as applicable, that has not been
duly made or obtained, except those (i) required in the ordinary course to
comply with ongoing covenant obligations of the Borrower and Parent hereunder
the performance of which is not yet due and (ii) that will, in the ordinary
course of business in accordance with this Agreement, be duly made or obtained
on or prior to the time or times the performance of such obligations shall be
due.
(d) This Agreement constitutes, and the Notes (if and when
delivered hereunder) and the other Financing Documents, if any, when delivered
hereunder shall constitute, legal, valid and binding obligations of the Borrower
or the Parent (as applicable) enforceable against each such Person in accordance
with their respective terms, except as may be limited by applicable bankruptcy,
insolvency, reorganization, moratorium or other similar laws affecting
creditors' rights generally or by general principles of equity.
(e) The consolidated balance sheet of the Parent and its
consolidated Subsidiaries as at December 31, 2000 and the related consolidated
statements of income and cash flow for the fiscal year then ended, reported on
by PricewaterhouseCoopers LLC, independent public accountants, and the
consolidated balance sheet of the Parent and its consolidated subsidiaries as at
September 30, 2001 and the related consolidated statements of income and cash
46
flow for the nine-month period then ended, certified by the chief financial
officer of the Parent, copies of each of which have been furnished to the
Administrative Agent and the Initial Lenders, fairly present the consolidated
financial condition of the Parent and such Subsidiaries as at December 31, 2000,
and September 30, 2001, respectively, and the consolidated results of their
operations for such fiscal periods, subject in the case of the September 30,
2001, statements to normal year-end adjustments, all in accordance with
generally accepted accounting principles consistently applied. From September
30, 2001 to and including the Effective Date there has been no material adverse
change in such condition or results of operations.
(f) As at the Effective Date, there is no action, suit or
proceeding pending, or to the knowledge of the Borrower and Parent threatened,
against or involving Parent or any Material Subsidiary in any court, or before
any arbitrator of any kind, or before or by any governmental body, which in the
reasonable judgment of the Borrower and Parent (taking into account the
exhaustion of all appeals) would have a material adverse effect on the
consolidated financial condition of Parent and its consolidated Subsidiaries
taken as a whole, or which purports to affect the legality, validity, binding
effect or enforceability of this Agreement, the Notes, if any, or the other
Financing Documents, if any.
(g) Parent and each of its consolidated Subsidiaries has duly
filed all tax returns required to be filed, and duly paid and discharged all
taxes, assessments and governmental charges upon it or against its properties
now due and payable, the failure to file or pay which, as applicable, would have
a Material Adverse Effect, unless and to the extent only that the same are being
contested in good faith and by appropriate proceedings by the Borrower or the
appropriate Subsidiary.
(h) Except to the extent permitted pursuant to Section
5.02(e), neither Parent nor any Material Subsidiary is subject to any
contractual restrictions which limit the amount of dividends payable by any
Subsidiary.
(i) No Termination Event has occurred or is reasonably
expected to occur with respect to any Plan which, with the giving of notice or
lapse of time, or both, would constitute an Event of Default under Section
6.01(g).
(j) Neither Parent nor any ERISA Affiliate has incurred, or is
reasonably expected to incur, any Withdrawal Liability to any Multiemployer Plan
that, when aggregated with all other amounts required to be paid to
Multiemployer Plans in connection with Withdrawal Liability (as of the date of
determination), exceeds 5% of the Consolidated Tangible Net Worth of Parent.
(k) Neither Parent nor any ERISA Affiliate has received any
notification that any Multiemployer Plan is in reorganization or has been
terminated, within the meaning of Title IV of ERISA, and no Multiemployer Plan
is reasonably expected to be in reorganization or to be terminated within the
meaning of Title IV of ERISA the effect of which reorganization or termination
would be the occurrence of an Event of Default under Section 6.01(i).
47
(l) Neither Parent nor the Borrower is an "investment company"
or a "company" controlled by an "investment company" within the meaning of the
United States Investment Company Act of 1940, as amended.
(m) Neither Parent nor the Borrower is a "holding company" or
a "subsidiary company" of a "holding company", or an "affiliate" of a "holding
company" or of a "subsidiary company" of a "holding company", or a "public
utility" within the meaning of the United States Public Utility Holding Company
Act of 1935, as amended.
All representations and warranties made by the Borrower and/or
Parent herein or made in any certificate delivered pursuant hereto shall survive
the making of the Advances and the execution and delivery to the Lenders of this
Agreement and the Notes.
ARTICLE 5
COVENANTS
SECTION 5.01. AFFIRMATIVE COVENANTS. So long as any Advance,
Note or other amount payable by the Borrower hereunder shall remain unpaid or
any Lender shall have any Commitment hereunder, Parent will, unless the Majority
Lenders shall otherwise consent in writing:
(a) PRESERVATION OF CORPORATE EXISTENCE, ETC. Preserve and
maintain, and cause each Material Subsidiary to preserve and maintain, its
existence, rights (organizational and statutory) and material franchises, except
as otherwise contemplated or permitted by Section 5.02(c) or 5.02(d); provided,
that any Material Subsidiary may change its form of organization to a
partnership or other form of Business Entity, provided further that in the case
of any such change by the Borrower, its jurisdiction of organization remains in
Canada, and in connection with any such change by the Borrower, the Borrower
shall cause to be delivered to the Administrative Agent a legal opinion of
counsel acceptable to the Administrative Agent to the effect that the successor
entity to the Borrower continues to be bound by, or has assumed by instrument or
by operation of law, all of the Borrower's obligations under this Agreement and
the Notes.
(b) COMPLIANCE WITH LAWS, ETC. Comply, and cause each
Subsidiary to comply, in all material respects, with all applicable laws, rules,
regulations and orders (including all environmental laws and laws requiring
payment of all taxes, assessments and governmental charges imposed upon it or
upon its property except to the extent contested in good faith by appropriate
proceedings) the failure to comply with which would have a Material Adverse
Effect.
(c) VISITATION RIGHTS. At such reasonable times and intervals
as the Administrative Agent or any of the Lenders may desire, permit the
Administrative Agent or any of the Lenders to visit the Borrower and to discuss
the affairs, finances, accounts and mineral reserve performance of Parent and
any of its Subsidiaries with officers of the Borrower and Parent and independent
certified public accountants of Parent and any of its Subsidiaries, provided
that if an Event of Default, or an event which with the giving of notice or the
passage of
48
time, or both, would become an Event of Default, has occurred and is
continuing, the Administrative Agent or any Lender may, in addition to the other
provisions of this subsection (c) and at such reasonable times and intervals as
the Administrative Agent or any of the Lenders may desire, visit and inspect,
under guidance of officers of Parent (or, in the case of properties of the
Borrower or its Subsidiaries, of the Borrower), as the case may be, any
properties significant to the consolidated operations of Parent and its
Subsidiaries, and to examine the books and records of account (other than with
respect to any mineral reserve information that Parent determines to be
confidential, except, during the continuation of an Event of Default, if such
Lenders shall have entered into a confidentiality agreement with respect to such
information satisfactory in form and substance to Parent) Parent and any of its
Subsidiaries and to discuss the affairs, finances and accounts of any of the
Subsidiaries of Parent with any of the officers of such Subsidiary.
(d) BOOKS AND RECORDS. Keep, and cause each of its
Subsidiaries to keep, proper books of record and account, in which full and
correct entries shall be made of all financial transactions and the assets and
business of Parent and each Subsidiary of Parent in accordance with GAAP either
(i) consistently applied or (ii) applied in a changed manner that does not,
under GAAP or public reporting requirements applicable to Parent either require
disclosure in the consolidated financial statements of Parent and its
consolidated Subsidiaries or require the consent of the accountants which (as
required by Section 5.03(b)) report on such financial statements for the fiscal
year in which such change shall have occurred, or (iii) applied in a changed
manner not covered by clause (ii) above provided such change shall have been
disclosed to the Administrative Agent and shall have been consented to by the
accountants which (as required by Section 5.03(b)) report on the consolidated
financial statements of Parent and its consolidated Subsidiaries for the fiscal
year in which such change shall have occurred, provided further that if any
change referred to in clause (ii) or (iii) above would not meet the standard set
forth in clause (i) or (ii) of Section 1.03, the Administrative Agent, the
Lenders, the Borrower and Parent agree to amend the covenants contained in
Section 5.01 and 5.02 so that the relative protection afforded thereby to the
Lenders and the relative flexibility afforded thereby to the Borrower will in
substance be retained after such amendment, provided further, however, that
until such amendment becomes effective hereunder, the covenants as set forth
herein shall remain in full force and effect and those accounting principles
applicable to Parent and its consolidated Subsidiaries which do meet the
standards set forth in clause (i) or (ii) of Section 1.03 shall be applied to
determine whether or not the Borrower is in compliance with such covenants.
(e) MAINTENANCE OF PROPERTIES, ETC. Maintain and preserve, and
cause each Material Subsidiary to maintain and preserve, all of its properties
which are used in the conduct of its business in good working order and
condition, ordinary wear and tear excepted, to the extent that any failure to do
so would have a Material Adverse Effect.
(f) MAINTENANCE OF INSURANCE. Maintain, and cause each
Material Subsidiary to maintain, insurance with responsible and reputable
insurance companies or associations in such amounts and covering such risks as
is usually carried by companies engaged in similar businesses and owning similar
properties in the same general areas in which Parent or such Subsidiary
operates.
49
SECTION 5.02. NEGATIVE COVENANTS. So long as any Advance, Note
or other amount payable by the Borrower hereunder shall remain unpaid or any
Lender shall have any Commitment hereunder, Parent will not, unless the Majority
Lenders shall otherwise consent in writing:
(a) LIENS, ETC. (i) Create, assume or suffer to exist, or
permit any Material Subsidiary to create, assume or suffer to exist, any Liens
upon or with respect to any of the Equity Interests in any Material Subsidiary,
whether now owned or hereafter acquired, or (ii) create or assume, or permit any
Material Subsidiary to create or assume, any Liens upon or with respect to any
other assets material to the consolidated operations of Parent and its
consolidated Subsidiaries taken as a whole securing the payment of Debt and
Guaranties in an aggregate amount (determined without duplication of amount (so
that the amount of a Guaranty will be excluded to the extent the Debt Guaranteed
thereby is included in computing such aggregate amount)) exceeding the greater
of (x) U.S.$250,000,000 and (y) 10% of Consolidated Tangible Net Worth as at the
date of such creation or assumption; provided, however, that this subsection (a)
shall not apply to:
(A) Liens on assets acquired by Parent or any of its
Subsidiaries after the Original Effective Date to the extent that such
Liens existed at the time of such acquisition and were not placed
thereon by or with the consent of Parent in contemplation of such
acquisition;
(B) Liens on Equity Interests acquired after the Original
Effective Date in a Business Entity which has become or becomes a
Subsidiary of Parent, or on assets of any such Business Entity, to the
extent that such Liens existed at the time of such acquisition and were
not placed thereon by or with the consent of Parent in contemplation of
such acquisition;
(C) Liens on Margin Stock;
(D) Liens on the Equity Interests in, or Debt or other
obligations of, or assets of, any Project Financing Subsidiary (or any
Equity Interests in, Debt or other obligations of any Business Entity
which are owned by any Project Financing Subsidiary) securing the
payment of a Project Financing and related obligations;
(E) Permitted Liens;
(F) Liens arising out of the refinancing, extension, renewal
or refunding of any Debt or Guaranty secured by any Lien permitted by
any of the foregoing clauses of this Section, provided that the
principal amount of such Debt or Guaranty is not increased (except by
the amount of costs reasonably incurred in connection with the issuance
thereof) and such Debt or Guaranty is not secured by any additional
assets that would not have been permitted by this Section to secure the
Debt or Guaranty refinanced, extended, renewed or refunded; and
(G) Liens on products and proceeds (including dividend,
interest and like payments on, and insurance and condemnation proceeds
and rental, lease, licensing and similar proceeds) of, and property
evidencing or embodying, or constituting rights or
50
other general intangibles relating to, and accessions and improvements
to, collateral subject to Liens permitted by this Section 5.02.
(b) DEBT, ETC. Create, assume or suffer to exist, or permit
any of its consolidated Subsidiaries to create, assume or suffer to exist, any
Debt or any Guaranty unless, immediately after giving effect to such Debt or
Guaranty and the receipt and application of any proceeds thereof or value
received in connection therewith,
(1) the sum (without duplication) of (i) consolidated Debt of
Parent and its consolidated Subsidiaries plus (ii) the aggregate amount
(determined on a consolidated basis) of Guaranties by Parent and its
consolidated Subsidiaries is less than 60% of Capitalization, provided
that Debt for borrowed money either maturing within one year and
evidenced by instruments commonly known as commercial paper, or
evidenced by variable demand notes or other similar short-term
financing instruments issued to commercial banks and trust companies
(other than Debt incurred pursuant to this Agreement, the U.S.
Short-Term Revolving Credit Agreement or the U.S. Long-Term Revolving
Credit Agreement or any replacement therefor), shall not exceed the sum
of unused commitments under this Agreement, the U.S. Short-Term
Revolving Credit Agreement and the U.S. Long-Term Revolving Credit
Agreement and the aggregate of Parent's unused bank lines of credit and
unused credit available to Parent under financing arrangements with
banks or other financial institutions; and
(2) with respect to any such Debt created or assumed by a
consolidated Subsidiary that is either a Subsidiary of Parent as of the
Original Effective Date or a Subsidiary of Parent acquired or created
after the Original Effective Date and owning a material portion of the
consolidated operating assets existing at the Original Effective Date
of Parent and its Subsidiaries, the aggregate amount of Debt of the
consolidated Subsidiaries of Parent referred to above in this paragraph
(2) owing to Persons other than Parent and its consolidated
Subsidiaries is less than the greater of (i) U.S.$500,000,000
(exclusive of public Debt of LL&E existing at the time LL&E became a
Subsidiary, the principal amount of which at such time was
approximately U.S.$400,000,000, and any refinancing of such Debt, in a
principal amount not to exceed the principal amount refinanced) and
(ii) 30% of Consolidated Tangible Net Worth as at the date of
incurrence or creation of such Debt.
(c) SALE, ETC. OF ASSETS. Sell, lease or otherwise transfer,
or permit any Material Subsidiary to sell, lease or otherwise transfer (in
either case, whether in one transaction or in a series of transactions, and
except, in either case, to the Borrower or Parent or an entity which after
giving effect to such transfer will be or become a Material Subsidiary in which
Parent's direct or indirect Equity Interests will be at least as great as its
direct or indirect Equity Interests in the transferor immediately prior thereto,
and except as permitted by Section 5.02(d)), assets constituting all or
substantially all of the consolidated assets of Parent and its Material
Subsidiaries, provided that, notwithstanding the foregoing, Parent or any
Material Subsidiary may sell, lease or otherwise transfer any Permitted Assets
constituting all or substantially all of the consolidated assets of Parent and
its Material Subsidiaries, so long as (A) such Permitted Assets are sold, leased
or otherwise transferred in exchange for other Permitted Assets and/or (B) the
proceeds from such sale, lease or other transfer, or an amount equal to the
proceeds
51
thereof, are (x) reinvested within one year from the date of receipt
thereof in Permitted Assets and/or the development of Permitted Assets and/or
(y) used to repay Debt the proceeds of which were or are being used for
investment in, and/or the development of, Permitted Assets; provided further
that, no such sale, lease or other transfer shall be permitted by the foregoing
proviso unless either (1) after giving effect to such sale, lease or other
transfer, no Event of Default, and no event which with lapse of time or the
giving of notice, or both, would constitute an Event of Default, shall have
occurred and be continuing or (2) Parent or the relevant Material Subsidiary, as
the case may be, was contractually obligated, prior to the occurrence of such
Event of Default or event, to consummate such sale, lease or other transfer.
(d) MERGERS, ETC. Merge, amalgamate or consolidate with any
Person, or in the case of Parent permit any Material Subsidiary to merge,
amalgamate or consolidate with any Person, except that:
(i) any Subsidiary may merge, amalgamate or consolidate with
(or liquidate into) any other Subsidiary or may merge, amalgamate or
consolidate with (or liquidate into) the Borrower or Parent, provided
that (A) if such Subsidiary merges, amalgamates or consolidates with
(or liquidates into) the Borrower or Parent, either (i) the survivor or
successor is the Borrower or Parent, as applicable, or (ii) in the case
of an amalgamation involving the Borrower under the laws of Canada or
any province thereof, the continuing corporation resulting from such
amalgamation is organized and existing under the laws of Canada or a
province thereof and continues by operation of law to be liable for all
obligations of the Borrower under this Agreement and under the Notes,
provided that notice thereof and a copy of the amalgamation documents
are provided to the Administrative Agent, or (iii) each successor or
surviving Business Entity is organized and existing under the laws of
Canada or a province thereof or the United States or a state thereof,
respectively, and expressly assumes the obligations of the Borrower or
Parent, as applicable, hereunder and under the Notes, (B) if any such
Subsidiary merges, amalgamates or consolidates with (or liquidates
into) any other Subsidiary of Parent, one or more Business Entities
that are Subsidiaries of Parent are the surviving or successor Business
Entity(ies) and, if either such Subsidiary is not directly or
indirectly wholly-owned by the Borrower or Parent, such merger,
amalgamation or consolidation is on an arm's length basis and (C) as a
result of such merger, amalgamation or consolidation, no Event of
Default, and no event which with lapse of time or the giving of notice,
or both, would constitute an Event of Default, shall have occurred and
be continuing, and
(ii) the Borrower, Parent or any Material Subsidiary may
merge, amalgamate or consolidate with any other Business Entity (that
is, in addition to the Borrower, Parent or any other Subsidiary of
Parent), provided that (A) if the Borrower or Parent merges,
amalgamates or consolidates with any such other Business Entity(ies),
either the survivor or successor Business Entity is the Borrower or
Parent, as applicable, (B) if any Material Subsidiary merges,
amalgamates or consolidates with any such other Business Entity, each
surviving or successor Business Entity is a directly or indirectly
wholly-owned Subsidiary, and (C) if either the Borrower, Parent or any
Material Subsidiary merges, amalgamates or consolidates with any such
other Business Entity, after giving effect to such merger, amalgamation
or consolidation no Event of Default, and no event which
52
with lapse of time or the giving of notice, or both, would constitute
an Event of Default, shall have occurred and be continuing.
(e) DIVIDEND RESTRICTIONS. Create, or consent or agree to, or
permit any of its Material Subsidiaries existing on the Original Effective Date
or any of its Subsidiaries thereafter created or acquired and owning a material
portion of the consolidated operating assets existing at the Original Effective
Date of Parent and its Subsidiaries, to create, or consent or agree to, any
restrictions, contained in any agreement or instrument relating to or evidencing
Debt, on any such Subsidiary's ability to pay dividends or to make advances to
Parent or any Subsidiary of Parent; provided, however, that this subsection (e)
shall not apply to any such restrictions (including any extensions of the term
of any thereof (by amendment, or continuation thereof in any refinancing of the
Debt to which such restriction relates, or otherwise)) applicable to the Equity
Interests in any Subsidiary of Parent, the Equity Interests in which are
acquired by Parent after the Original Effective Date and which restrictions are
existing at the time such Subsidiary first becomes a Subsidiary of Parent and
are not placed thereon by or with the consent of Parent in contemplation of such
acquisition by Parent.
SECTION 5.03. REPORTING REQUIREMENTS. So long as any Note
shall remain unpaid or any Lender shall have any Commitment hereunder, the
Borrower will furnish to each Lender in such reasonable quantities as shall from
time to time be requested by such Lender:
(a) within 60 days after the end of each of the first three
quarters of each fiscal year of Parent, a consolidated balance sheet of Parent
and its consolidated Subsidiaries as of the end of such quarter, and
consolidated statements of income and cash flow of Parent and its consolidated
Subsidiaries each for the period commencing at the end of the previous fiscal
year and ending with the end of such quarter, certified (subject to normal
year-end adjustments) as to fairness and utilization of GAAP by the chief
financial officer of Parent and accompanied by a certificate of such officer
stating (i) that such statements of income and cash flow and such balance sheet
have been prepared in accordance with GAAP, (ii) whether or not such officer has
knowledge of the occurrence of any Event of Default which is continuing
hereunder or of any event not theretofore remedied which with notice or lapse of
time or both would constitute such an Event of Default and, if so, stating in
reasonable detail the facts with respect thereto, (iii) all relevant facts in
reasonable detail to evidence, and the computations as to, whether or not Parent
is in compliance with the requirements set forth in subsection (b) of Section
5.02, and (iv) a listing of all Material Subsidiaries and consolidated
Subsidiaries of Parent showing the extent of its direct and indirect holdings of
their Equity Interests;
(b) within 120 days after the end of each fiscal year of
Parent, a copy of the annual report for such year for Parent and its
consolidated Subsidiaries containing financial statements for such year reported
on by nationally recognized independent public accountants acceptable to the
Lenders, accompanied by (i) a report signed by said accountants stating that
such financial statements have been prepared in accordance with GAAP and (ii) a
letter from such accountants stating that in making the investigations necessary
for such report they obtained no knowledge, except as specifically stated
therein, of any Event of Default which is continuing hereunder or of any event
not theretofore remedied which with notice or lapse of time or both would
constitute such an Event of Default;
53
(c) within 120 days after the close of Parent's fiscal years,
a certificate of the chief financial officer of Parent stating (i) whether or
not such officer has knowledge of the occurrence of any Event of Default which
is continuing hereunder or of any event not theretofore remedied which with
notice or lapse of time or both would constitute such an Event of Default and,
if so, stating in reasonable detail the facts with respect thereto, (ii) all
relevant facts in reasonable detail to evidence, and the computations as to,
whether or not Parent is in compliance with the requirements set forth in
subsection (b) of Section 5.02 and (iii) a listing of all Material Subsidiaries
and consolidated Subsidiaries of Parent showing the extent of its direct and
indirect holdings of their Equity Interests;
(d) promptly upon their distribution, copies of all financial
statements, reports and proxy statements which the Parent or any Material
Subsidiary shall have sent to its public Equity Interest holders;
(e) promptly upon their becoming publicly available, all
regular and periodic financial reports and registration statements which the
Borrower or any Material Subsidiary shall file with the Securities and Exchange
Commission or any national securities exchange other than registration
statements relating to employee benefit plans and to registration statements of
securities for selling security holders;
(f) promptly in writing, notice of all litigation and of all
proceedings before any governmental or regulatory agencies against or involving
Parent or any Material Subsidiary, except any litigation or proceeding which in
the reasonable judgment of Parent (taking into account the exhaustion of all
appeals) is not likely to have a material adverse effect on the consolidated
financial condition of Parent and its consolidated Subsidiaries taken as a
whole;
(g) within three Business Days after an executive officer of
the Borrower or Parent obtains knowledge of the occurrence of any Event of
Default which is continuing or of any event not theretofore remedied which with
notice or lapse of time, or both, would constitute an Event of Default, notice
of such occurrence together with a detailed statement by a responsible officer
of the Borrower or Parent of the steps being taken by the Borrower, Parent or
the appropriate Subsidiary to cure the effect of such event;
(h) as soon as practicable and in any event (i) within 30 days
after Parent or any ERISA Affiliate knows or has reason to know that any
Termination Event described in clause (i) of the definition of Termination Event
with respect to any Plan has occurred and (ii) within 10 days after Parent or
any ERISA Affiliate knows or has reason to know that any other Termination Event
with respect to any Plan has occurred, a statement of the chief financial
officer of Parent describing such Termination Event and the action, if any,
which Parent or such ERISA Affiliate proposes to take with respect thereto;
(i) promptly and in any event within two Business Days after
receipt thereof by Parent or any ERISA Affiliate, copies of each notice received
by Parent or any ERISA Affiliate from the PBGC stating its intention to
terminate any Plan or to have a trustee appointed to administer any Plan;
54
(j) promptly and in any event within 30 days after the filing
thereof with the Internal Revenue Service, copies of each Schedule B (Actuarial
Information) to the annual report (Form 5500 Series) with respect to each Plan;
(k) promptly and in any event within five Business Days after
receipt thereof by Parent or any ERISA Affiliate from the sponsor of a
Multiemployer Plan, a copy of each notice received by Parent or any ERISA
Affiliate concerning (i) the imposition of Withdrawal Liability by a
Multiemployer Plan, (ii) the determination that a Multiemployer Plan is, or is
expected to be, in reorganization within the meaning of Title IV of ERISA, (iii)
the termination of a Multiemployer Plan within the meaning of Title IV of ERISA,
or (iv) the amount of liability incurred, or expected to be incurred, by Parent
or any ERISA Affiliate in connection with any event described in clause (i),
(ii) or (iii) above; and
(l) as soon as practicable but in any event within 60 days of
any notice of request therefor, such other information respecting the financial
condition and results of operations of Parent or any Subsidiary as any Lender
through the Administrative Agent may from time to time reasonably request.
Each balance sheet and other financial statement furnished
pursuant to subsections (a) and (b) of this Section 5.03 shall contain
comparative information which conforms to the presentation required in Form 10-Q
and Form 10-K, as appropriate, under the Securities Exchange Act of 1934, as
amended.
ARTICLE 6
EVENTS OF DEFAULT
SECTION 6.01. EVENTS OF DEFAULT. If any of the following
events ("EVENTS OF DEFAULT") shall occur and be continuing:
(a) The Borrower shall fail to pay any principal of any
Advance within two Business Days after the same shall be due, or any interest on
any Advance or any other amount payable hereunder within five Business Days
after the same shall be due; or
(b) Any representation or warranty made or deemed made by the
Borrower or Parent herein or by the Borrower or Parent (or any of its officers)
in connection with this Agreement shall prove to have been incorrect in any
material respect when made or deemed made; or
(c) The Borrower or Parent shall fail to perform or observe
any other term, covenant or agreement contained in this Agreement on its part to
be performed or observed and any such failure shall remain unremedied for 30
days after written notice thereof shall have been given to the Borrower or
Parent by the Administrative Agent or by any Lender with a copy to the
Administrative Agent; or
(d) Parent or any Material Subsidiary of Parent shall fail to
pay any Debt or Guaranty (excluding any Advances) of the Borrower, Parent or
such Subsidiary (as the case may
55
be) in an aggregate principal amount in excess of the greater of (i)
U.S.$100,000,000 and (ii) 3% of Consolidated Tangible Net Worth at such time, or
any installment of principal thereof or interest or premium thereon, when due
(whether by scheduled maturity, required prepayment, acceleration, demand or
otherwise) and such failure shall continue after the applicable grace period, if
any, specified in the agreement or instrument relating to such Debt or Guaranty;
or any other default under any agreement or instrument relating to any such
Debt, or any other event, shall occur and shall continue after the applicable
grace period, if any, specified in such agreement or instrument, if the effect
of such default or event is to accelerate the maturity of such Debt; provided
that, notwithstanding any provision contained in this subsection (d) to the
contrary, to the extent that pursuant to the terms of any agreement or
instrument relating to any Debt referred to in this subsection (d), any sale,
pledge or disposal of Margin Stock, or utilization of the proceeds thereof would
result in a breach of any covenant contained therein or otherwise give rise to a
default or event of default thereunder and/or acceleration of the maturity of
the Debt extended pursuant thereto and as a result of such terms or of such
sale, pledge, disposal, utilization, breach, default, event of default or
acceleration, or the provisions hereof relating thereto, this Agreement or any
Advance hereunder would otherwise be subject to margin requirements or any other
restriction under Regulation U issued by the Board of Governors of the United
States Federal Reserve System, then such breach, default, event of default or
acceleration shall not constitute a default or Event of Default under this
subsection (d); or
(e) (i) Parent or any Material Subsidiary shall (A) generally
not pay its debts as such debts become due; or (B) admit in writing its
inability to pay its debts generally; or (C) make a general assignment for the
benefit of creditors; or (ii) any proceeding shall be instituted or consented to
by Parent or any such Material Subsidiary seeking to adjudicate it a bankrupt or
insolvent, or seeking liquidation, winding up, reorganization, arrangement,
adjustment, protection, relief, or composition of it or its debts under any law
relating to bankruptcy, insolvency or reorganization or relief of debtors, or
seeking the entry of an order for relief or the appointment of a receiver,
trustee, or other similar official for it or for any substantial part of its
property; or (iii) any such proceeding shall have been instituted against the
Borrower, Parent or any such Subsidiary and either such proceeding shall not be
stayed or dismissed for 60 consecutive days or any of the actions referred to
above sought in such proceeding (including the entry of an order for relief
against it or the appointment of a receiver, trustee, custodian or other similar
official for it or any substantial part of its property) shall occur; or (iv)
the Borrower, Parent or any such Subsidiary shall take any corporate action to
authorize any of the actions set forth above in this subsection (e); or
(f) Any judgment or order for the payment of money in excess
the greater of (i) U.S.$100,000,000 and (ii) 3% of Consolidated Tangible Net
Worth at such time shall be rendered against Parent or any Material Subsidiary
and either (i) enforcement proceedings shall have been commenced and are
continuing or have been completed by any creditor upon such judgment or order
(other than any enforcement proceedings consisting of the mere obtaining and
filing of a judgment lien or obtaining of a garnishment or similar order so long
as no foreclosure, levy or similar process in respect of such lien, or payment
over in respect of such garnishment or similar order, has commenced and is
continuing or has been completed) or (ii) there shall be any period of 30
consecutive days during which a stay of execution or enforcement proceedings
(other than those referred to in the parenthesis in clause (i) above) in respect
of such judgment or order, by reason of a pending appeal, bonding or otherwise,
shall not be in effect; or
56
(g) Any Termination Event with respect to a Material Plan
shall have occurred and, 30 days after notice thereof shall have been given to
Parent by the Lender, (i) such Termination Event shall still exist and (ii) the
sum (determined as of the date of occurrence of such Termination Event) of the
Insufficiency of such Plan and the Insufficiency of any and all other Plans with
respect to which a Termination Event shall have occurred and then exist (or in
the case of a Plan with respect to which a Termination Event described in clause
(ii) of the definition of Termination Event shall have occurred and then exist,
the liability related thereto), in each case in respect of which Parent or any
ERISA Affiliate has liability, is equal to or greater than U.S.$50,000,000; or
(h) Parent or any ERISA Affiliate shall have been notified by
the sponsor of a Multiemployer Plan that it has incurred Withdrawal Liability to
such Multiemployer Plan in an amount which, when aggregated with all other
amounts required to be paid to Multiemployer Plans in connection with Withdrawal
Liabilities (determined as of the date of such notification), exceeds
U.S.$50,000,000; or
(i) Parent or any ERISA Affiliate shall have been notified by
the sponsor of a Multiemployer Plan that such Multiemployer Plan is in
reorganization or is being terminated, within the meaning of Title IV of ERISA,
if as a result of such reorganization or termination the aggregate annual
contributions of the Borrower and its ERISA Affiliates to all Multiemployer
Plans which are then in reorganization or being terminated have been or will be
increased over the amounts contributed to such Multiemployer Plans for the
respective plan years which include the Original Effective Date by an amount
exceeding U.S.$50,000,000; or
(j) Upon completion of, and pursuant to, a transaction, or a
series of transactions (which may include prior acquisitions of capital stock of
Parent in the open market or otherwise), involving a tender offer (i) a "person"
(within the meaning of Section 13(d) of the Securities Exchange Act of 1934)
other than Parent, a Subsidiary of Parent or any employee benefit plan
maintained for employees of Parent and/or any of its respective Subsidiaries or
the trustee therefor, shall have acquired direct or indirect ownership of and
paid for in excess of 50% of the outstanding capital stock of Parent entitled to
vote in elections for directors of Parent and (ii) at any time before the later
of (x) six months after the completion of such tender offer and (y) the next
annual meeting of the shareholders of Parent following the completion of such
tender offer more than half of the directors of Parent consists of individuals
who (a) were not directors before the completion of such tender offer and (b)
were not appointed, elected or nominated by the Board of Directors in office
prior to the completion of such tender offer (other than any such appointment,
election or nomination required or agreed to in connection with, or as a result
of, the completion of such tender offer); or
(k) The Borrower ceases to be a direct or indirect
wholly-owned Subsidiary of the Parent; or
(l) The Guaranty of Parent hereunder shall not be (or shall be
claimed by Parent, Borrower or any Subsidiary of Parent not to be) valid or in
full force and effect; provided that if within one Business Day after the
Borrower or Parent receives notice from the Administrative Agent or otherwise
becomes aware that such Guaranty is not valid or in full force and effect,
Parent delivers written notice to the Administrative Agent that it intends to
deliver a
57
valid and effective Guaranty, or to reinstate such Guaranty, as soon as
possible, then an Event of Default shall not exist pursuant this Section 6.01(l)
unless Parent shall fail to deliver or reinstate a Guaranty having substantially
the same effect as the Guaranty set forth in Article 8 within four Business Days
after the delivery of such written notice of intent.
(m) Any "Event of Default" as defined in the U.S. Short-Term
Revolving Credit Agreement or the U.S. Long-Term Revolving Credit Agreement
shall occur and be continuing;
then, and in any such event, the Administrative Agent shall at
the request, or may with the consent, of the Majority Lenders, by notice to the
Borrower and Parent, (i) declare the obligation of each Lender to make Advances
to be terminated, whereupon the same shall forthwith terminate, and (ii) declare
the Advances, all interest thereon and all other amounts payable under this
Agreement to be forthwith due and payable, whereupon the Advances, all such
interest and all such amounts shall become and be forthwith due and payable,
without presentment, demand, protest or further notice of any kind, all of which
are hereby expressly waived by the Borrower and Parent; provided, however, that
if an Event of Default under subsection (e) of this Section 6.01 (except under
clause (i)(A) thereof) shall occur, (A) the obligation of each Lender to make
Advances shall automatically be terminated and (B) the Advances, all interest
thereon and all other amounts payable under this Agreement shall automatically
become and be forthwith due and payable, without presentment, demand, protest or
any notice of any kind, all of which are hereby expressly waived by the Borrower
and Parent.
ARTICLE 7
THE ADMINISTRATIVE AGENT
SECTION 7.01. AUTHORIZATION AND ACTION. Each Lender hereby
appoints and authorizes the Administrative Agent to take such action as agent on
its behalf and to exercise such powers under this Agreement as are delegated to
the Administrative Agent by the terms hereof, together with such powers as are
reasonably incidental thereto. As to any matters not expressly provided for by
this Agreement (including enforcement of this Agreement or collection of the
Notes), the Administrative Agent shall not be required to exercise any
discretion or take any action, but shall be required to act or to refrain from
acting (and shall be fully protected in so acting or refraining from acting)
upon the instructions of the Majority Lenders, and such instructions shall be
binding upon all Lenders and all holders of Notes; provided, however, that the
Administrative Agent shall not be required to take any action which exposes the
Administrative Agent to personal liability or which is contrary to this
Agreement or applicable law. The Administrative Agent agrees to give to each
Lender prompt notice of each notice given to it by the Borrower pursuant to the
terms of this Agreement. Nothing in this Agreement shall impose upon any
Co-Syndication Agent or Co-Documentation Agent, in its capacity as such, any
duty or liability whatsoever.
SECTION 7.02. ADMINISTRATIVE AGENT'S RELIANCE, ETC. Neither
the Administrative Agent nor any of its directors, officers, agents or employees
shall be liable for any action taken or omitted to be taken by it or them under
or in connection with this Agreement, except for its or their own gross
negligence or willful misconduct. Without limitation of the
58
generality of the foregoing, the Administrative Agent: (i) may treat the payee
of any Note as the holder thereof until the Administrative Agent receives and
accepts an Assignment and Acceptance entered into by the Lender which is the
payee of such Note, as assignor, and an Eligible Assignee, as assignee, as
provided in Section 9.07; (ii) may consult with legal counsel (including counsel
for the Borrower and Parent), independent public accountants and other experts
selected by it and shall not be liable for any action taken or omitted to be
taken in good faith by it in accordance with the advice of such counsel,
accountants or experts; (iii) makes no warranty or representation to any Lender
and shall not be responsible to any Lender for any statements, warranties or
representations (whether written or oral) made in or in connection with this
Agreement; (iv) shall not have any duty to ascertain or to inquire as to the
performance or observance of any of the terms, covenants or conditions of this
Agreement on the part of the Borrower and Parent or to inspect the property
(including the books and records) of the Borrower or Parent; (v) shall not be
responsible to any Lender for the due execution, legality, validity,
enforceability, genuineness, sufficiency or value of this Agreement or any other
instrument or document furnished pursuant hereto; and (vi) shall incur no
liability under or in respect of this Agreement by acting upon any notice,
consent, certificate or other instrument or writing (which may be by facsimile,
electronic mail, telegram, telecopy, cable or telex) believed by it to be
genuine and signed or sent by the proper party or parties.
SECTION 7.03. ADMINISTRATIVE AGENT AND AFFILIATES. With
respect to its Commitments, the Advances made by it and the Notes issued to it,
the Administrative Agent shall have the same rights and powers under this
Agreement as any other Lender and may exercise the same as though it were not
the Administrative Agent; and the term "Lender" or "Lenders" shall, unless
otherwise expressly indicated, include the Administrative Agent in its
individual capacity. The Administrative Agent and its Affiliates may accept
deposits from, lend money to, act as trustee under indentures of, and generally
engage in any kind of business with, Parent, the Borrower, any of their
Subsidiaries, and any Person who may do business with or own securities of
Parent, the Borrower or any of their Subsidiaries, all as if the Administrative
Agent were not the Administrative Agent and without any duty to account therefor
to the other Lenders.
SECTION 7.04. LENDER CREDIT DECISION. Each Lender acknowledges
that it has, independently and without reliance upon the Administrative Agent or
any other Lender and based on the financial statements referred to in Section
4.01 and such other documents and information as it has deemed appropriate, made
its own credit analysis and decision to enter into this Agreement. Each Lender
also acknowledges that it will, independently and without reliance upon the
Administrative Agent or any other Lender and based on such documents and
information as it shall deem appropriate at the time, continue to make its own
credit decisions in taking or not taking action under this Agreement.
SECTION 7.05. INDEMNIFICATION. THE LENDERS AGREE TO INDEMNIFY
THE ADMINISTRATIVE AGENT (TO THE EXTENT NOT REIMBURSED BY THE BORROWER OR
PARENT), RATABLY ACCORDING TO THE RESPECTIVE PRINCIPAL AMOUNTS OF THE ADVANCES
THEN HELD BY EACH OF THEM (OR IF NO ADVANCES ARE AT THE TIME OUTSTANDING OR IF
ANY ADVANCES ARE HELD BY PERSONS WHICH ARE NOT LENDERS, RATABLY ACCORDING TO THE
RESPECTIVE AMOUNTS OF THEIR COMMITMENTS OR THE RESPECTIVE AMOUNTS
59
OF THEIR COMMITMENTS IMMEDIATELY PRIOR TO TERMINATION IF THE COMMITMENTS HAVE
BEEN TERMINATED), FROM AND AGAINST ANY AND ALL LIABILITIES, OBLIGATIONS, LOSSES,
DAMAGES, PENALTIES, ACTIONS, JUDGMENTS, SUITS, COSTS, EXPENSES AND DISBURSEMENTS
OF ANY KIND OR NATURE WHATSOEVER WHICH MAY BE IMPOSED ON, INCURRED BY, OR
ASSERTED AGAINST THE ADMINISTRATIVE AGENT IN ANY WAY RELATING TO OR ARISING OUT
OF THIS AGREEMENT, ANY OF THE NOTES OR ANY OTHER FINANCING DOCUMENT OR OTHER
INSTRUMENT OR DOCUMENT FURNISHED PURSUANT HERETO OR IN CONNECTION HEREWITH, OR
ANY ACTION TAKEN OR OMITTED BY THE ADMINISTRATIVE AGENT UNDER THIS AGREEMENT, OR
ANY OF THE NOTES OR ANY OTHER FINANCING DOCUMENT OR OTHER INSTRUMENT OR DOCUMENT
FURNISHED PURSUANT HERETO OR IN CONNECTION HEREWITH; PROVIDED THAT NO LENDER
SHALL BE LIABLE FOR ANY PORTION OF SUCH LIABILITIES, OBLIGATIONS, LOSSES,
DAMAGES, PENALTIES, ACTIONS, JUDGMENTS, SUITS, COSTS, EXPENSES OR DISBURSEMENTS
RESULTING FROM THE ADMINISTRATIVE AGENT'S GROSS NEGLIGENCE OR WILFUL MISCONDUCT.
Without limitation of the foregoing, each Lender agrees to
reimburse the Administrative Agent promptly upon demand for such Lender's
ratable share of any reasonable out-of-pocket expenses (including counsel fees)
incurred by the Administrative Agent in connection with the preparation,
execution, delivery, administration, modification, amendment or enforcement
(whether through negotiations, legal proceedings, in bankruptcy or insolvency
proceedings, or otherwise) of, or legal advice in respect of rights or
responsibilities under, this Agreement, any of the Notes or any other instrument
or document furnished pursuant hereto or in connection herewith to the extent
that the Administrative Agent acts in its capacity as Administrative Agent and
is not reimbursed for such expenses by the Borrower or Parent.
SECTION 7.06. SUCCESSOR ADMINISTRATIVE AGENT. The
Administrative Agent may resign at any time by giving written notice thereof to
the Lenders, the Borrower and Parent and may be removed at any time with or
without cause by the Majority Lenders. Upon any such resignation or removal, the
Majority Lenders shall have the right to appoint a successor Administrative
Agent. If no successor Administrative Agent shall have been so appointed by the
Majority Lenders, and shall have accepted such appointment, within 30 days after
the retiring Administrative Agent's giving of notice of resignation or the
Majority Lenders' removal of the retiring Administrative Agent, then such
retiring Administrative Agent may, on behalf of the Lenders, appoint a successor
Administrative Agent, which shall be a bank organized, or authorized to conduct
a banking business, under the federal laws of Canada and having a combined
capital and surplus of at least U.S.$500,000,000. Upon the acceptance of any
appointment as Administrative Agent hereunder by a successor Administrative
Agent, such successor Administrative Agent shall thereupon succeed to and become
vested with all the rights, powers, privileges and duties of the retiring
Administrative Agent, and the retiring Administrative Agent shall be discharged
from its duties and obligations under this Agreement. After any retiring
Administrative Agent's resignation or removal hereunder as Administrative Agent,
the provisions of this Article 7 shall inure to its benefit as to any actions
taken or omitted to be taken by it while it was Administrative Agent under this
Agreement.
60
ARTICLE 8
GUARANTY
In order to induce the Lenders to extend credit hereunder,
Parent hereby irrevocably and unconditionally guarantees the Obligations. Parent
agrees that the Guaranteed Parties may make a claim under Parent's guarantee
immediately upon the occurrence of an Event of Default or at any time
thereafter, but (other than in the case of an Event of Default in respect of the
Borrower under Section 6.01(e) (except clause (i)(A) thereof)) following the
making of a demand on the Borrower for payment or performance, as applicable,
without any obligation to first seek any other remedy or take any other action
against the Borrower. Parent further agrees that the due and punctual payment of
the Obligations may be extended or renewed, in whole or in part, without notice
to or further assent from it, and that it will remain bound upon its Guaranty
hereunder notwithstanding any such extension or renewal of any Obligation. Each
and every default in payment of the principal of and premium, if any, or
interest on any Obligation shall give rise to a separate cause of action
hereunder, and separate suits may be brought hereunder as each cause of action
arises.
Parent waives presentment to, demand of payment from and
protest to the Borrower of any of the Obligations, and also waives notice of
acceptance of its obligations and notice of protest for nonpayment. The
obligations of Parent hereunder shall not be affected by (a) the failure of any
Guaranteed Party to assert any claim or demand or to enforce any right or remedy
against the Borrower or Parent under the provisions of this Agreement, any other
Financing Document or otherwise; (b) any extension or renewal of any of the
Obligations; (c) any rescission, waiver, amendment or modification of, or
release from, any of the terms or provisions of this Agreement or any other
Financing Document or agreement; (d) the failure or delay of any Guaranteed
Party to exercise any right or remedy against any other guarantor of the
Obligations; (e) the failure of any Guaranteed Party to assert any claim or
demand or to enforce any remedy under any Financing Document, any guaranty or
any other agreement or instrument; (f) any default, failure or delay, wilful or
otherwise, in the performance of the Obligations; or (h) any other act, omission
or delay to do any other act which may or might in any manner or to any extent
vary the risk of Parent or otherwise operate as a discharge of Parent as a
matter of law or equity or which would impair or eliminate any right of Parent
to subrogation.
Parent further agrees that its agreement hereunder constitutes
a promise of payment when due (whether or not any bankruptcy or similar
proceeding shall have stayed the accrual or collection of any of the Obligations
or operated as a discharge thereof) and not merely of collection, and waives any
right to require that any resort be had by any Guaranteed Party to any balance
of any deposit account or credit on the books of any Guaranteed Party in favor
of any Borrower or any other Person.
The obligations of Parent hereunder shall not be subject to
any reduction, limitation, impairment or termination for any reason, and shall
not be subject to any defense or setoff, counterclaim, recoupment or termination
whatsoever, by reason of the invalidity, illegality or unenforceability of the
Obligations, any impossibility in the performance of the Obligations or
otherwise.
61
Parent further agrees that its obligations hereunder shall
continue to be effective or be reinstated, as the case may be, if at any time
payment, or any part thereof, of any Obligation is rescinded or must otherwise
be restored by any Guaranteed Party upon the bankruptcy or reorganization of
Borrower or otherwise.
In furtherance of the foregoing and not in limitation of any
other right which any Guaranteed Party may have at law or in equity against
Parent by virtue hereof, upon the failure of the Borrower to pay any Obligation
when and as the same shall become due, whether at maturity, by acceleration,
after notice of prepayment or otherwise, Parent hereby promises to and will,
upon receipt of written demand by the Administrative Agent, forthwith pay, or
cause to be paid, to the Administrative Agent for distribution to the Guaranteed
Parties in cash an amount equal to the sum of (i) the unpaid principal amount of
such Obligations then due, (ii) accrued and unpaid interest and fees on such
Obligations and (iii) all other monetary Obligations then due. Parent further
agrees that if payment in respect of any Obligation shall be due in a currency
other than Cdn. Dollars and/or at a place of payment other than Toronto, Ontario
and if, by reason of any Change in Law, disruption of currency or foreign
exchange markets, war or civil disturbance or similar event, payment of such
Obligation in such currency or at such place of payment shall be impossible or,
in the judgment of any Guaranteed Party, not consistent with the protection of
its rights or interests, then, at the election of such Guaranteed Party, Parent
shall make payment of such Obligation in Cdn. Dollars (based upon the applicable
Exchange Rate in effect on the date of payment) and/or in Toronto, Ontario, and
shall indemnify such Guaranteed Party against any losses or expenses that it
shall sustain as a result of such alternative payment.
Upon payment in full by Parent of any Obligation, each Lender
shall, in a reasonable manner, assign the amount of such Obligation owed to it
and so paid to Parent, such assignment to be pro tanto to the extent to which
the Obligation in question was discharged by Parent, or make such disposition
thereof as Parent shall direct (all without recourse to any Guaranteed Party and
without any representation or warranty by any Guaranteed Party).
Upon payment by Parent of any sums as provided above, all
rights of Parent against the Borrower arising as a result thereof by way of
right of subrogation or otherwise shall in all respects be subordinated and
junior in right of payment to the prior indefeasible payment in full of all the
Obligations owed by the Borrower to the Guaranteed Parties.
Nothing shall discharge or satisfy the liability of Parent
hereunder except the full performance and payment of the Obligations.
Each reference herein to any Guaranteed Party shall be deemed
to include their or its successors and assigns, in whose favor the provisions of
this Guaranty shall also inure.
ARTICLE 9
MISCELLANEOUS
SECTION 9.01. AMENDMENTS, ETC. An amendment or waiver of any
provision of this Agreement, the Notes or any other Financing Document, or a
consent to any departure by the Borrower therefrom, shall be effective against
the Lenders and all holders of the Notes if, but
62
only if, it shall be in writing and signed or consented to in writing by the
Majority Lenders or, where so specified, the Required Lenders (except any
amendment to give effect to increased Commitments and New Lenders, as
contemplated by Section 2.20), and then such a waiver or consent shall be
effective only in the specific instance and for the specific purpose for which
given; provided, however, that no such amendment, waiver or consent shall,
unless in writing and signed by all the Lenders, be effective to: (a) waive any
of the conditions specified in Article 3, (b) except as contemplated by Section
2.20, increase the Commitments of the Lenders or subject the Lenders to any
additional obligations, (c) reduce the principal of, or interest on, the
Advances or any facility fees or utilization fees hereunder, (d) except as
contemplated by Section 2.21, postpone any date fixed for any payment of
principal of, or interest on, the Advances or any facility fees or utilization
fees hereunder, (e) change the percentage of the Commitments or of the aggregate
unpaid principal amount of the Advances, which shall be required for the Lenders
or any of them to take any action under this Agreement, (f) amend Article VIII
or this Section 9.01, or (g) waive any Event of Default pursuant to Section
6.01(l); and, provided further that no amendment, waiver or consent shall,
unless in writing and signed by the Administrative Agent in addition to the
Lenders required herein above to take such action, affect the rights or duties
of the Administrative Agent under this Agreement or any Note.
SECTION 9.02. NOTICES, ETC. Except as otherwise provided in
Section 2.02(a) or 2.10(ii), all notices and other communications provided for
hereunder shall be in writing and mailed by registered mail, return receipt
requested and postage prepaid, or telecopied, sent by facsimile or otherwise
teletransmitted, or delivered, if to the Borrower, c/o Burlington Resources Inc.
at 5051 Westheimer, Suite 1400, Houston, Texas 77056, Attention: Treasurer,
Facsimile: (713) 624-9627 with a copy to Burlington Resources Canada Ltd. 3700,
250 6th Avenue S.W., Calgary, Alberta, Canada T2P3H7, Attention: Dave Belcher,
Facsimile: (403) 263-2708 ; if to Parent, Burlington Resources Inc. at 5051
Westheimer, Suite 1400, Houston, Texas 77056, Attention: Treasurer, Facsimile:
(713) 624-9627; if to any Initial Lender, at its Applicable Lending Office set
forth in such Initial Lender's Administrative Questionnaire; if to any other
Lender at its Applicable Lending Office specified in the Assignment and
Acceptance or Commitment Increase Agreement pursuant to which it became a
Lender; if to the Administrative Agent, in care of J.P. Morgan Bank Canada, 200
Bay Street, Suite 1800, Royal Bank Plaza, South Tower, Toronto, Ontario, M5J
2J2, Attention: Amanda Staff, Telefax: (416) 981-9128, with a copy to JPMorgan
Chase Bank, at 600 Travis Street, 20th Floor, Houston, TX 77002, Attention:
Russell Johnson, Telefax: (713) 216-8870; or, as to each party, at such other
address as shall be designated by such party in a written notice to the other
parties. All such notices and communications shall be effective, (a) in the case
of any notice or communication given by certified mail, when receipted for, (b)
in the case of any notice or communication given by telecopy, facsimile or other
teletransmission, when confirmed by appropriate answerback, in each case
addressed as aforesaid, and (c) in the case of any notice or communication
delivered by hand or courier, when so delivered, except that notices and
communications to the Administrative Agent pursuant to Article 2 or 7 shall not
be effective until received by the Administrative Agent. A notice received by
the Administrative Agent or a Lender by telephone pursuant to Section 2.02(a) or
2.10(ii) shall be effective if the Administrative Agent or Lender believes in
good faith that it was given by an authorized representative of the Borrower or
Parent and acts pursuant thereto, notwithstanding the absence of written
confirmation or any contradictory provision thereof.
63
SECTION 9.03. NO WAIVER; REMEDIES. No failure on the part of
any Lender or the Administrative Agent to exercise, and no delay in exercising,
any right hereunder or under any Note shall operate as a waiver thereof; nor
shall any single or partial exercise of any right hereunder or under any Note
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 9.04. COSTS AND EXPENSES; INDEMNITY. (a) The Borrower
agrees to pay on demand (i) all reasonable fees and out-of-pocket expenses of
counsel for the Administrative Agent and the Arranger in connection with the
preparation, execution and delivery of this Agreement, the Notes and the other
Financing Documents to be delivered hereunder and with respect to advising the
Administrative Agent and the Arranger as to their respective rights and
responsibilities under this Agreement, (ii) all reasonable costs and expenses
incurred by the Administrative Agent and its Affiliates and the Arranger and
their Affiliates in initially syndicating all or any portion of the Commitments
hereunder, including the related reasonable fees and out-of-pocket expenses of
counsel for the Administrative Agent or its Affiliates and the Arranger and
their Affiliates, travel expenses, duplication and printing costs and courier
and postage fees, and excluding any syndication fees paid to other parties
joining the syndicate and (iii) all out-of-pocket costs and expenses, if any, of
the Administrative Agent and the Arranger and the Lenders (including reasonable
counsel fees and expenses and the allocated costs of in-house counsel), in
connection with the enforcement (whether through negotiations, legal
proceedings, in bankruptcy or insolvency proceedings, or otherwise) of this
Agreement, the Notes and the other Financing Documents to be delivered hereunder
and thereunder.
(b) If any payment of principal of, or Continuation of, any
Eurodollar Rate Advance is made by the Borrower to or for the account of a
Lender on any day other than the last day of the Interest Period for such
Advance, as a result of a prepayment pursuant to Section 2.10 or a Continuation
pursuant to Section 2.08(f) or Section 2.09 or due to acceleration of the
maturity of the Advances pursuant to Section 6.01 or due to any other reason
attributable to the Borrower, or if the Borrower shall fail to borrow, Continue
or prepay any Eurodollar Rate Advance on the date specified in any notice
delivered pursuant hereto, the Borrower shall, upon demand by such Lender (with
a copy of such demand to the Administrative Agent), pay to the Administrative
Agent for the account of such Lender any amounts required to compensate such
Lender for any additional losses, costs or expenses which it may reasonably
incur as a result of such payment or Continuation, including any loss (excluding
loss of anticipated profits), cost or expense incurred by reason of the
liquidation or reemployment of deposits or other funds acquired by any Lender to
fund or maintain such Advance.
(c) If any payment of principal of any B/A Advance is made by
the Borrower to or for the account of a Lender on any day other than the last
day of the Interest Period for such Advance, due to acceleration of the maturity
of the Advances pursuant to Section 6.01, or if the Borrower shall fail to
borrow, Continue or prepay any B/A Advance on the date specified in any notice
delivered pursuant hereto, the Borrower shall, upon demand by such Lender (with
a copy of such demand to the Administrative Agent), pay to the Administrative
Agent for the account of such Lender any amounts required to compensate such
Lender for any additional losses, costs or expenses which it may reasonably
incur as a result of such payment, including any loss (excluding loss of
anticipated profits), cost or expense incurred by reason of the liquidation or
64
reemployment of deposits or other funds acquired by any Lender to fund or
maintain such Advance. It is understood that a defeasance of B/A's under Section
2.10(a) shall not constitute a prepayment.
(d) EACH OF THE BORROWER AND PARENT AGREES TO INDEMNIFY AND
HOLD HARMLESS THE ADMINISTRATIVE AGENT, THE ARRANGER AND EACH LENDER FROM AND
AGAINST ANY AND ALL CLAIMS, DAMAGES, LIABILITIES AND EXPENSES (INCLUDING FEES
AND DISBURSEMENTS OF COUNSEL) WHICH MAY BE INCURRED BY OR ASSERTED AGAINST THE
ADMINISTRATIVE AGENT, THE ARRANGER OR SUCH LENDER IN CONNECTION WITH OR ARISING
OUT OF ANY INVESTIGATION, LITIGATION, OR PROCEEDING (WHETHER OR NOT THE
ADMINISTRATIVE AGENT, THE ARRANGER OR SUCH LENDER IS PARTY THERETO) RELATED TO
ANY ACQUISITION OR PROPOSED ACQUISITION BY THE BORROWER, OR BY ANY SUBSIDIARY OF
THE BORROWER, OF ALL OR ANY PORTION OF THE EQUITY INTERESTS IN, OR SUBSTANTIALLY
ALL THE ASSETS OF, ANY PERSON OR ANY USE OR PROPOSED USE OF THE ADVANCES BY THE
BORROWER (EXCLUDING ANY CLAIMS, DAMAGES, LIABILITIES OR EXPENSES INCURRED BY
REASON OF THE GROSS NEGLIGENCE OR WILLFUL MISCONDUCT OF THE PARTY TO BE
INDEMNIFIED OR ITS EMPLOYEES OR ADMINISTRATIVE AGENTS, OR BY REASON OF ANY USE
OR DISCLOSURE OF INFORMATION RELATING TO ANY SUCH ACQUISITION OR USE OR PROPOSED
USE OF THE PROCEEDS BY THE PARTY TO BE INDEMNIFIED OR ITS EMPLOYEES OR
ADMINISTRATIVE AGENTS).
SECTION 9.05. RIGHT OF SET-OFF. Upon the declaration of the
Advances as due and payable pursuant to the provisions of Section 6.01, each
Lender 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 Lender to or for the credit or the
account of the Borrower against any and all of the obligations of the Borrower
now or hereafter existing under this Agreement and any Note held by such Lender,
irrespective of whether or not such Lender shall have made any demand under this
Agreement or such Note and although such obligations may be unmatured. Each
Lender agrees promptly to notify the Borrower after any such set-off and
application made by such Lender, provided that the failure to give such notice
shall not affect the validity of such set-off and application. The rights of
each Lender under this Section 9.05 are in addition to other rights and remedies
(including other rights of set-off) which such Lender may have.
SECTION 9.06. BINDING EFFECT. This Agreement shall become
effective in accordance with the provisions of Section 3.01, and thereafter
shall be binding upon and inure to the benefit of the Borrower, Parent, the
Administrative Agent, the Arranger and each Lender and their respective
successors and assigns, except that neither Parent nor the Borrower shall have
the right to assign its rights and obligations hereunder or any interest herein
without the prior written consent of all of the Lenders; provided that
notwithstanding the foregoing the Borrower shall be permitted to transfer its
rights and obligations hereunder to a wholly-owned Subsidiary of Parent (i) if
such Subsidiary is organized and existing under the laws of Canada or any
65
political subdivision thereof and (ii) Burlington Resources Canada Ltd.
guarantees the obligations of the new Borrower on substantially the same terms
as Parent, at which time Burlington Resources Canada Ltd. shall cease to be a
Borrower hereunder and shall cease to have any liability under this Agreement,
the Notes, if any, or any other Financing Document except such guarantee. Any
merger, amalgamation or consolidation in compliance with Section 5.02(d) of (i)
the Borrower with Parent or a wholly-owned Subsidiary of Parent organized under
the laws of Canada or any political subdivision thereof, or (ii) Parent shall
not constitute an assignment for purposes of this Section 9.06.
SECTION 9.07. ASSIGNMENTS AND PARTICIPATIONS. (a) Each Lender
may assign to one or more banks or other entities all or a portion of its rights
and obligations under this Agreement (including all or a portion of its
Commitment, the Advances owing to it and the Note or Notes held by it);
provided, however, that each such assignment shall be to an Eligible Assignee
and the parties to each such assignment shall execute and deliver to the
Administrative Agent, for its acceptance and recording in the Register, an
Assignment and Acceptance, together with any Note or Notes subject to such
assignment and, except in the case of an assignment to a Lender Affiliate, a
processing and recordation fee of Cdn.$3,500, and shall send to the Borrower an
executed counterpart of such Assignment and Acceptance, and provided further,
however, that (i) except in the case of an assignment to a Lender Affiliate,
each such assignment shall be of a constant, and not a varying, percentage of
all such Lender's rights and obligations under this Agreement, (ii) the amount
of the Commitment of the assigning Lender being assigned to the assignee
pursuant to each such assignment (determined as of the date of the Assignment
and Acceptance with respect to such assignment) must be equal to or greater than
Cdn.$10,000,000, or if less, the entire amount of such assigning Lender's
"Commitment" (unless the Borrower and the Administrative Agent shall otherwise
consent, which consent may be withheld for any reason) and must be an integral
multiple of Cdn.$1,000,000, and (iii) except in the case of an assignment by a
Schedule II Lender to a Lender Affiliate thereof that is a Schedule III Bank,
any assignment to a Lender Affiliate will not relieve the assigning Lender of
its obligation to make Advances hereunder timely in accordance with the terms
hereof in the event such Lender Affiliate shall fail to do so. Upon the
execution, delivery, acceptance and recording of each Assignment and Acceptance
by the parties thereto, from and after the effective date specified in such
Assignment and Acceptance, (x) the assignee thereunder shall be a party hereto
and, subject to clause (iii) above, to the extent that rights and obligations
hereunder have been assigned to it pursuant to such Assignment and Acceptance,
have the rights and obligations of a Lender hereunder and (y) except in the
circumstances contemplated in clause (iii) above, the Lender assignor thereunder
shall, to the extent that rights and obligations hereunder have been assigned by
it pursuant to such Assignment and Acceptance covering all or the remaining
portion of an assigning Lender's rights and obligations under this Agreement,
such Lender shall cease to be a party hereto, provided, however, such assigning
Lender shall retain any claim with respect to any fee, interest, cost, expense
or indemnity which accrues, or relates to an event that occurs, prior to the
date of such assignment pursuant to Section 2.03, 2.06, 2.12, 2.13, 2.16 or
9.04)
(b) By executing and delivering an Assignment and Acceptance,
each Lender assignor thereunder and the assignee thereunder confirm to and agree
with each other and the other parties hereto as follows: (i) other than as
provided in such Assignment and Acceptance, such assigning Lender makes no
representation or warranty and assumes no responsibility with respect to any
statements, warranties or representations made in or in connection with this
66
Agreement or the execution, legality, validity, enforceability, genuineness,
sufficiency or value of this Agreement or any other instrument or document
furnished pursuant hereto; (ii) such assigning Lender makes no representation or
warranty and assumes no responsibility with respect to the financial condition
of the Borrower or Parent or the performance or observance by the Borrower or
Parent of any of its obligations under this Agreement or any other instrument or
document furnished pursuant hereto; (iii) such assignee confirms that it has
received a copy of this Agreement, together with copies of the financial
statements referred to in Section 4.01 and such other documents and information
as it has deemed appropriate to make its own credit analysis and decision to
enter into such Assignment and Acceptance; (iv) such assignee will,
independently and without reliance upon the Administrative Agent, such assigning
Lender or any other Lender and based on such documents and information as it
shall deem appropriate at the time, continue to make its own credit decisions in
taking or not taking action under this Agreement; (v) such assignee confirms
that it is (subject to approval in writing by the Borrower and the
Administrative Agent to the extent required) an Eligible Assignee; (vi) such
assignee appoints and authorizes the Administrative Agent to take such action as
agent on its behalf and to exercise such powers under this Agreement as are
delegated to the Administrative Agent by the terms hereof, together with such
powers as are reasonably incidental thereto; and (vii) such assignee agrees that
it will perform in accordance with their terms all of the obligations which by
the terms of this Agreement are required to be performed by it as a Lender.
(c) The Administrative Agent shall maintain at its address
referred to in Section 9.02 a copy of each Assignment and Acceptance, each New
Lender Agreement and each Commitment Increase Agreement delivered to and
accepted by it and a register (which register may be in electronic form) for the
recordation of the names and addresses of the Lenders and the Commitment of, and
principal amount of the Advances owing to, each Lender from time to time (the
"REGISTER"). The entries in the Register shall be conclusive and binding for all
purposes, absent manifest error, and the Borrower, the Administrative Agent and
the Lenders may treat each Person whose name is recorded in the Register as a
Lender hereunder for all purposes of this Agreement. The Register shall be
available for inspection by the Borrower or any Lender at any reasonable time
and from time to time upon reasonable prior notice.
(d) Upon its receipt of an Assignment and Acceptance executed
by an assigning Lender and an assignee representing that it is an Eligible
Assignee, together with any Note or Notes subject to such assignment, the
Administrative Agent shall, if such Assignment and Acceptance has been completed
and is in substantially the form of Exhibit D hereto, (i) accept such Assignment
and Acceptance, (ii) record the information contained therein in the Register
and (iii) give prompt notice thereof to the Borrower. Within five Business Days
after its receipt of such notice and its receipt of an executed counterpart of
such Assignment and Acceptance, the Borrower, at its own expense, shall execute
and deliver to the Administrative Agent in exchange for any surrendered Note or
Notes a new Note to the order of such Eligible Assignee and, if the assigning
Lender has retained a Commitment hereunder, a new Note to the order of the
assigning Lender. Any such new Note or Notes shall be dated the effective date
of such Assignment and Acceptance and shall otherwise be in substantially the
form of Exhibit A hereto.
(e) Each Lender may sell participations to one or more banks
or other entities in or to all or a portion of its rights and obligations under
this Agreement (including all or a
67
portion of its Commitment, and the Advances owing to it and the Note or Notes
held by it); provided, however, that (i) such Lender's obligations under this
Agreement (including its Commitment to the Borrower hereunder) shall remain
unchanged, (ii) such Lender shall remain solely responsible to the other parties
hereto for the performance of such obligations, (iii) such Lender shall remain
the holder of any such Note for all purposes of this Agreement, (iv) the
Borrower, the Administrative Agent and the other Lenders shall continue to deal
solely and directly with such Lender in connection with such Lender's rights and
obligations under this Agreement, (v) such Lender shall continue to be able to
agree to any modification or amendment of this Agreement or any waiver hereunder
without the consent, approval or vote of any such participant or group of
participants, other than modifications, amendments and waivers which (A)
postpone any date fixed for any payment of, or reduce any payment of, principal
of or interest on such Lender's Advances or any facility fees or utilization
fees payable under this Agreement, or (B) increase the amount of such Lender's
Commitment in a manner which would have the effect of increasing the amount of a
participant's participation, or (C) reduce the interest rate payable under this
Agreement and such Lender's Advances, or (D) consent to the assignment or the
transfer by the Borrower or Parent of their respective rights and obligations
under the Agreement, and (vi) except as contemplated by the immediately
preceding clause (v), no participant shall be deemed to be or to have any of the
rights or obligations of a "Lender" hereunder.
(f) Any Lender may, in connection with any assignment or
participation or proposed assignment or participation pursuant to this Section
9.07, disclose to the assignee or participant or proposed assignee or
participant, any information relating to the Borrower furnished to such Lender
by or on behalf of the Borrower; provided that, prior to any such disclosure,
the assignee or participant or proposed assignee or participant shall agree in
writing for the benefit of the Borrower to preserve the confidentiality of any
confidential information relating to the Borrower received by it from such
Lender in a manner consistent with Section 9.08.
(g) Anything in this Agreement to the contrary
notwithstanding, any Lender may at any time create a security interest in all or
any portion of its rights under this Agreement (including the Advances owing to
it) and the Notes, if any, issued to it hereunder in favor of any United States
Federal Reserve Bank in accordance with Regulation A of the Board of Governors
of the Federal Reserve System of the United States (or any successor regulation)
and the applicable operating circular of such Federal Reserve Bank.
SECTION 9.08. CONFIDENTIALITY. Each Lender and the
Administrative Agent (each, a "PARTY") agrees that it will use its best
reasonable efforts not to disclose, without the prior consent of the Borrower
(other than to its, or its Affiliates, employees, auditors, accountants, counsel
or other representatives, whether existing at the Effective Date or any
subsequent time), any information with respect to the Borrower or Parent which
is furnished pursuant to this Agreement, provided that any party may disclose
any such information (i) as has become generally available to the public, (ii)
as may be required or appropriate in any report, statement or testimony
submitted to any governmental authority having or claiming to have jurisdiction
over such party, (iii) as may be required or appropriate in response to any
summons or subpoena or in connection with any litigation or regulatory
proceeding, (iv) in order to comply with any law, order, regulation or ruling
applicable to such party, or (v) to any prospective assignee or
68
participant in connection with any contemplated assignment of any rights or
obligations hereunder or any sale of any participation therein, by such party
pursuant to Section 9.07, if such prospective assignee or participant, as the
case may be, executes an agreement with the Borrower containing provisions
substantially similar to those contained in this Section 9.08; provided,
however, that the Borrower and Parent acknowledge that the Administrative Agent
has disclosed and may continue to disclose such information as the
Administrative Agent in its sole discretion determines is appropriate to the
Lenders from time to time.
SECTION 9.09. CONSENT TO JURISDICTION. (a) Each of the
Borrower and Parent hereby irrevocably and unconditionally submit itself and its
property to the non-exclusive jurisdiction of the Courts of the Province of
Alberta in any action or proceeding by the Administrative Agent, the Arranger,
any Lender or the holder of any Note in respect of, but only in respect of, any
claims or causes of action arising out of or relating to this Agreement, the
Notes or the other Financing Documents (such claims and causes of action,
collectively, being "PERMITTED CLAIMS"), and each of the Borrower and Parent
hereby irrevocably agrees that all Permitted Claims may be heard and determined
in Alberta. Each of the Borrower and Parent hereby irrevocably and
unconditionally waives, to the fullest extent it may effectively do so, the
defense of an inconvenient forum to the maintenance of such action or proceeding
in any aforementioned court in respect of Permitted Claims. Service of the
statement of claim and any other process which may be served by the
Administrative Agent, the Arranger, any Lender or the holder of any Note on the
Borrower or Parent in any such action or proceeding in any aforementioned court
in respect of Permitted Claims may be made by delivering separate copies of such
process to each of the Borrower and Parent by courier and by registered mail
(return receipt requested), fees and postage prepaid at the address of each of
the Borrower and Parent specified pursuant to Section 9.02, to the attention of
each of the Treasurer and the Vice President and General Counsel of Parent, or
each of the General Counsel and Assistant Treasurer in the case of the Borrower.
Each of the Borrower and Parent agrees that a final judgment in any such action
or proceeding shall be conclusive and may be enforced in other jurisdictions by
suit on the judgment or in any other manner provided by law.
(b) Nothing in this Section 9.09 (i) shall affect the right of
the Arranger, the Borrower, Parent, any Lender, the holder of any Note or the
Administrative Agent to serve legal process in any other manner permitted by law
or affect any right otherwise existing of the Borrower, any Lender, the
Arranger, the holder of any Note or the Administrative Agent to bring any action
or proceeding in the courts of other jurisdictions or (ii) shall be deemed to be
a general consent to jurisdiction in any particular court or a general waiver of
any defense or a consent to jurisdiction of the courts expressly referred to in
subsection (a) above in any action or proceeding in respect of any claim or
cause of action other than Permitted Claims.
SECTION 9.10. GOVERNING LAW. This Agreement and the Notes
shall be governed by, and construed in accordance with, the laws of the Province
of Alberta and the federal laws of Canada applicable therein.
SECTION 9.11. EXECUTION IN COUNTERPARTS. This Agreement may be
executed in any number of counterparts and by different parties hereto in
separate counterparts, each of which when so executed shall be deemed to be an
original and all of which taken together shall constitute one and the same
agreement. Delivery to the Administrative Agent of a counterpart
69
executed by a Lender shall constitute delivery of such counterpart to all of the
Lenders. Delivery of an executed counterpart by facsimile shall be as effective
as delivery of a manually executed original counterpart.
SECTION 9.12. WAIVER OF JURY TRIAL. THE BORROWER, PARENT, THE
ADMINISTRATIVE AGENT, AND THE LENDERS HEREBY IRREVOCABLY AND UNCONDITIONALLY
WAIVE ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING ARISING OUT OF
OR RELATING TO THIS AGREEMENT, ANY OF THE NOTES OR ANY OTHER FINANCING DOCUMENT
OR OTHER INSTRUMENT OR DOCUMENT FURNISHED PURSUANT HERETO OR IN CONNECTION
HEREWITH OR THE TRANSACTIONS CONTEMPLATED HEREBY.
70
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be executed by their respective officers thereunto duly authorized,
as of the date first above written.
BURLINGTON RESOURCES CANADA LTD.
By:
------------------------------------
Name:
Title:
BURLINGTON RESOURCES INC.
By:
------------------------------------
Name:
Title:
71
SCHEDULE I
MATERIAL SUBSIDIARIES OF PARENT
Burlington Resources Canada Ltd.
Burlington Resources Canada Corporation
Burlington Acquisition Corporation*
Canadian Hunter Exploration Ltd.
The Louisiana Land and Exploration Company
Burlington Resources Oil & Gas Company LP
BROG GP Inc.
BROG LP Inc.
* until such time as the company amalgamates with Canadian Hunter Exploration
Ltd.
SCHEDULE II
PRICING GRID
<Table>
<Caption>
LEVEL I LEVEL II LEVEL III LEVEL IV LEVEL V
Basis for Pricing If the Parent's If the Parent's If the Parent's If the Parent's If the Parent's
senior unsecured senior unsecured senior unsecured senior unsecured senior unsecured
long term debt is long term debt is long term debt is long term debt is long term debt is
rated at least A by rated at least A- rated at least BBB+ rated at least rated at least BBB-
S&P or A2 by Moody's by S&P or A3 by S&P or Baa1 by BBB by S&P or by S&P or Baa3 by
by Moody's Moody's. Baa2 by Moody's. Moody's.
Facility Fee
Percentage .080% .100% .125% .150% .200%
Applicable Margin .270% .300% .375% .450% .650%
<Caption>
LEVEL VI
Basis for Pricing If Levels I-V do
not apply.
Facility Fee
Percentage .250%
Applicable Margin .750%
</Table>
The applicable pricing level shall change on the date of any relevant change
in the rating by S&P or Moody's of any public long term senior unsecured
debt securities of the Borrower. In the case of split ratings from S&P and
Moody's, the rating to be used to determine the applicable pricing level is
the higher of the two (e.g., A-/Baa1 results in Level II pricing), provided
that in the event the split is more than one full category, the average (or
the higher of two intermediate ratings) shall be used (e.g., A-/Baa2 results
in Level III pricing, as does A-/Baa3). For the avoidance of doubt, the
amount to be paid with respect to any Acceptance Fee shall be determined on
the date of the acceptance of the applicable B/A, and the Acceptance Fee
paid on each date shall not be subject to adjustment based on a subsequent
change in the pricing level.
SCHEDULE III
<Table>
<Caption>
Commitments The Initial Lenders
- ----------- -------------------
- ---------------------------
Cdn. $ Total
</Table>