EXHIBIT 10.1
Execution Copy
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AMENDED AND RESTATED CREDIT AGREEMENT
DATED AS OF DECEMBER 15, 2000
AS AMENDED AND RESTATED THROUGH
MARCH 6, 2003
AMONG
VALERO LOGISTICS OPERATIONS, L.P.
THE LENDERS PARTY HERETO
AND
JPMORGAN CHASE BANK,
AS ADMINISTRATIVE AGENT
ROYAL BANK OF CANADA,
AS SYNDICATION AGENT
SUNTRUST BANK AND MIZUHO CORPORATE BANK LTD.,
AS CO-DOCUMENTATION AGENTS
J.P. MORGAN SECURITIES INC.,
AS ARRANGER
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TABLE OF CONTENTS
<Table>
<Caption>
PAGE
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ARTICLE I
Definitions
SECTION 1.01. Defined Terms ..................................................1
SECTION 1.02. Classification of Loans and Borrowings ........................18
SECTION 1.03. Terms Generally ...............................................18
SECTION 1.04. Accounting Terms; GAAP ........................................18
ARTICLE II
The Credits
SECTION 2.01. Commitments ...................................................18
SECTION 2.02. Loans and Borrowings ..........................................19
SECTION 2.03. Requests for Borrowings .......................................20
SECTION 2.04. Letters of Credit .............................................21
SECTION 2.05. Funding of Borrowings .........................................24
SECTION 2.06. Interest Elections ............................................25
SECTION 2.07. Termination and Reduction of Commitments ......................26
SECTION 2.08. Repayment of Loans; Evidence of Debt ..........................27
SECTION 2.09. Prepayment of Loans ...........................................27
SECTION 2.10. Fees ..........................................................28
SECTION 2.11. Interest ......................................................29
SECTION 2.12. Alternate Rate of Interest ....................................30
SECTION 2.13. Increased Costs ...............................................30
SECTION 2.14. Break Funding Payments ........................................31
SECTION 2.15. Taxes .........................................................32
SECTION 2.16. Payments Generally; Pro Rata Treatment; Sharing of Set-offs ...32
SECTION 2.17. Mitigation Obligations; Replacement of Lenders ................34
SECTION 2.18. Procedures Regarding Increases to the Commitments .............35
ARTICLE III
Representations and Warranties
SECTION 3.01. Organization; Powers ..........................................37
SECTION 3.02. Authorization; Enforceability .................................37
SECTION 3.03. Governmental Approvals; No Conflicts ..........................37
SECTION 3.04. Financial Condition; No Material Adverse Change ...............38
SECTION 3.05. Properties ....................................................38
SECTION 3.06. Litigation and Environmental Matters ..........................38
SECTION 3.07. Compliance with Laws and Agreements ...........................39
SECTION 3.08. Investment and Holding Company Status .........................39
SECTION 3.09. Taxes .........................................................39
SECTION 3.10. ERISA .........................................................39
SECTION 3.11. Disclosure ....................................................39
SECTION 3.12. Investments and Guarantees ....................................39
</Table>
i
<Table>
SECTION 3.13. Subsidiaries ..................................................40
SECTION 3.14. Casualties; Taking of Property ................................40
ARTICLE IV
Conditions
SECTION 4.01. Conditions to Restatement .....................................40
SECTION 4.02. Each Credit Event .............................................41
ARTICLE V
Affirmative Covenants
SECTION 5.01. Financial Statements and Other Information ....................42
SECTION 5.02. Notices of Material Events ....................................44
SECTION 5.03. Existence; Conduct of Business ................................45
SECTION 5.04. Payment of Obligations ........................................45
SECTION 5.05. Maintenance of Properties; Insurance ..........................45
SECTION 5.06. Books and Records; Inspection Rights ..........................45
SECTION 5.07. Compliance with Laws ..........................................45
SECTION 5.08. Use of Proceeds and Letters of Credit .........................45
SECTION 5.09. Environmental Laws ............................................46
SECTION 5.10. Clean-Down ....................................................46
SECTION 5.11. Subsidiaries ..................................................46
ARTICLE VI
Negative Covenants
SECTION 6.01. Indebtedness ..................................................47
SECTION 6.02. Liens .........................................................47
SECTION 6.03. Fundamental Changes ...........................................48
SECTION 6.04. Investments, Loans, Advances, Guarantees and Acquisitions .....48
SECTION 6.05. Hedging Agreements ............................................49
SECTION 6.06. Restricted Payments ...........................................49
SECTION 6.07. Transactions with Affiliates ..................................49
SECTION 6.08. Restrictive Agreements ........................................49
SECTION 6.09. Limitation on Modifications of Other Agreements ...............50
SECTION 6.10. Creation of Subsidiaries ......................................50
SECTION 6.11. Financial Condition Covenants .................................50
ARTICLE VII
Events of Default
ARTICLE VIII
The Administrative Agent
ARTICLE IX
Miscellaneous
SECTION 9.01. Notices .......................................................55
SECTION 9.02. Waivers; Amendments ...........................................55
SECTION 9.03. Expenses; Indemnity; Damage Waiver ............................56
</Table>
ii
<Table>
SECTION 9.04. Successors and Assigns ......................................57
SECTION 9.05. Survival ....................................................59
SECTION 9.06. Counterparts; Integration; Effectiveness ....................60
SECTION 9.07. Severability ................................................60
SECTION 9.08. Right of Setoff .............................................60
SECTION 9.09. Governing Law; Jurisdiction; Consent to Service of Process ..60
SECTION 9.10. WAIVER OF JURY TRIAL ........................................61
SECTION 9.11. Headings ....................................................61
SECTION 9.12. Confidentiality .............................................61
SECTION 9.13. Interest Rate Limitation ....................................62
SECTION 9.14. Limitation of Liability .....................................62
</Table>
SCHEDULES:
Schedule 2.01 - Commitments
Schedule 3.06 - Disclosed Matters
Schedule 6.07 - Affiliate Agreements
Schedule 6.08 - Existing Restrictions
EXHIBITS:
Exhibit A -- Form of Assignment and Acceptance
Exhibit B -- Form of Opinion of Borrower's Counsel
Exhibit C-1 - Form of MLP Guaranty Agreement
Exhibit C-2 - Form of Subsidiary Guaranty Agreement
Exhibit D-1 - Form of Initial Notice of Commitment Increase
Exhibit D-2 - Form of Notice of Confirmation of Commitment Increase
iii
CREDIT AGREEMENT dated as of December 15, 2000 as amended and restated
through March 6, 2003, among VALERO LOGISTICS OPERATIONS, L.P., a Delaware
limited partnership formerly known as Shamrock Logistics Operations, L.P., the
LENDERS party hereto, JP MORGAN CHASE BANK, formerly known as The Chase
Manhattan Bank, as Administrative Agent, ROYAL BANK OF CANADA, as Syndication
Agent (the "Syndication Agent"), and SUNTRUST BANK and MIZUHO CORPORATE BANK
LTD., as Co-Documentation Agents (the "Co-Documentation Agents").
The parties hereto agree as follows:
ARTICLE I
Definitions
SECTION 1.01. Defined Terms. As used in this Agreement, the following
terms have the meanings specified below:
"ABR", when used in reference to any Loan or Borrowing, refers to
whether such Loan, or the Loans comprising such Borrowing, are bearing interest
at a rate determined by reference to the Alternate Base Rate.
"Adjusted LIBO Rate" means, with respect to any Eurodollar Borrowing
for any Interest Period, an interest rate per annum (rounded upwards, if
necessary, to the next 1/16 of 1%) equal to (a) the LIBO Rate for such Interest
Period multiplied by (b) the Statutory Reserve Rate.
"Administrative Agent" means JPMorgan Chase Bank, formerly known as The
Chase Manhattan Bank, in its capacity as administrative agent for the Lenders
hereunder.
"Administrative Questionnaire" means an Administrative Questionnaire in
a form supplied by the Administrative Agent.
"Affiliate" means, with respect to a specified Person, another Person
that directly, or indirectly through one or more intermediaries, Controls or is
Controlled by or is under common Control with the Person specified.
"Agreement" means this Credit Agreement, dated as of December 15, 2000,
as amended and restated through March 6, 2003 among the Borrower, the Lenders,
the Administrative Agent, the Syndication Agent, and the Co-Documentation
Agents, as the same may be amended, waived or otherwise modified from time to
time in accordance herewith.
"Alternate Base Rate" means, for any day, a rate per annum equal to the
greatest of (a) the Prime Rate in effect on such day, (b) the Base CD Rate in
effect on such day plus 1% and (c) the Federal Funds Effective Rate in effect on
such day plus 1/2 of 1%. Any change in the Alternate Base Rate due to a change
in the Prime Rate, the Base CD Rate or the Federal Funds Effective Rate shall be
effective from and including the effective date of such change in the Prime
Rate, the Base CD Rate or the Federal Funds Effective Rate, respectively.
"Applicable Percentage" means, with respect to any Lender, the
percentage of the total Commitments represented by such Lender's Commitment. If
the Commitments have terminated
or expired, the Applicable Percentages shall be determined based upon the
Commitments most recently in effect, giving effect to any assignments.
"Applicable Rate" means with respect to any ABR Loan or Eurodollar
Loan, or with respect to the facility fees payable hereunder, as the case may
be, the applicable rate per annum set forth below under the caption "ABR
Spread", "Eurodollar Spread" or "Facility Fee Rate", as the case may be, based
upon the ratings by Moody's and/or S&P, respectively, applicable on such date to
the Index Debt:
<Table>
<Caption>
INDEX DEBT RATINGS: ABR SPREAD EURODOLLAR SPREAD FACILITY FEE RATE
------------------- ---------- ----------------- -----------------
Tier 1
Greater than or equal to BBB/Baa2 0.00% 0.950% 0.300%
Tier 2
Equal to BBB-/Baa3 0.00% 1.125% 0.375%
Tier 3
Less than BBB-/Baa3 0.250% 1.250% 0.500%
</Table>
For purposes of the foregoing, (i) if either Moody's or S&P shall not have in
effect a rating for the Index Debt (after having established such a rating and
other than by reason of the circumstances referred to in the last sentence of
this definition), then such rating agency shall be deemed to have established a
rating in Tier 3; (ii) if both Moody's and S&P have established a rating for the
Index Debt and such ratings established or deemed to have been established by
Moody's and S&P shall fall within different Tiers, the Applicable Rate shall be
based on the higher of the two ratings unless one of the two ratings is two or
more Tiers lower than the other, in which case the Applicable Rate shall be
determined by reference to the Tier next below that of the higher of the two
ratings; and (iii) if the ratings established or deemed to have been established
by Moody's and S&P for the Index Debt shall be changed (other than as a result
of a change in the rating system of Moody's or S&P), such change shall be
effective as of the date on which it is first announced by the applicable rating
agency. Each change in the Applicable Rate shall apply during the period
commencing on the effective date of such change and ending on the date
immediately preceding the effective date of the next such change. If the rating
system of Moody's or S&P shall change, or if either such rating agency shall
cease to be in the business of rating corporate debt obligations, the Borrower
and the Lenders shall negotiate in good faith to amend this definition to
reflect such changed rating system or the unavailability of ratings from such
rating agency and, pending the effectiveness of any such amendment, the
Applicable Rate shall be determined by reference to the rating most recently in
effect prior to such change or cessation.
"Assessment Rate" means, for any day, the annual assessment rate in
effect on such day that is payable by a member of the Bank Insurance Fund
classified as "well-capitalized" and
2
within supervisory subgroup "B" (or a comparable successor risk classification)
within the meaning of 12 C.F.R. Part 327 (or any successor provision) to the
Federal Deposit Insurance Corporation for insurance by such Corporation of time
deposits made in dollars at the offices of such member in the United States;
provided that if, as a result of any change in any law, rule or regulation, it
is no longer possible to determine the Assessment Rate as aforesaid, then the
Assessment Rate shall be such annual rate as shall be determined by the
Administrative Agent to be representative of the cost of such insurance to the
Lenders.
"Assignment and Acceptance" means an assignment and acceptance entered
into by a Lender and an assignee (with the consent of any party whose consent is
required by Section 9.04), and accepted by the Administrative Agent, in the form
of Exhibit A or any other form approved by the Administrative Agent.
"Availability Period" means the period from and including the Original
Effective Date to but excluding the earlier of the Maturity Date and the date of
termination of the Commitments.
"Base CD Rate" means the sum of (a) the Three-Month Secondary CD Rate
multiplied by the Statutory Reserve Rate plus (b) the Assessment Rate.
"Benefit Arrangement" means at any time an employee benefit plan within
the meaning of Section 3(3) of ERISA which is not a Plan or a Multiemployer Plan
and which is maintained or otherwise contributed to by any ERISA Affiliate.
"Board" means the Board of Governors of the Federal Reserve System of
the United States of America.
"Borrower" means Valero Logistics Operations, L.P., a Delaware limited
partnership, formerly known as Shamrock Logistics Operations, L.P.
"Borrowing" means Loans of the same Type, made, converted or continued
on the same date and, in the case of Eurodollar Loans, as to which a single
Interest Period is in effect.
"Borrowing Request" means a request by the Borrower for a Borrowing in
accordance with Section 2.03.
"Business Day" means any day that is not a Saturday, Sunday or other
day on which commercial banks in New York City are authorized or required by law
to remain closed; provided that, when used in connection with a Eurodollar Loan,
the term "Business Day" shall also exclude any day on which banks are not open
for dealings in dollar deposits in the London interbank market.
"Capital Lease Obligations" of any Person means the obligations of such
Person to pay rent or other amounts under any lease of (or other arrangement
conveying the right to use) real or personal property, or a combination thereof,
which obligations are required to be classified and accounted for as capital
leases on a balance sheet of such Person under GAAP, and the amount of such
obligations shall be the capitalized amount thereof determined in accordance
with GAAP.
3
"Change in Control" means any of the following events:
(a) (i) Valero shall cease, indirectly or directly, to own at
least 51% of the issued and outstanding Equity Interests of, or shall cease to
Control, the general partner(s) of the MLP, or (ii) 100% (and not less than
100%) of the issued and outstanding Equity Interest of the general partner(s) of
the Borrower shall cease to be owned, directly or indirectly, or the Borrower
shall cease to be Controlled, by Valero and/or the MLP;
(b) any "person" or "group" (as such terms are used in
Sections 13(d) and 14(d) of the Securities Exchange Act of 1934, as amended (the
"Exchange Act")), excluding Valero and its Wholly-Owned Subsidiaries, shall
become, or obtain rights (whether by means of warrants, options or otherwise) to
become, the "beneficial owner" (as defined in Rules 13(d)-3 and 13(d)-5 under
the Exchange Act), directly or indirectly, of twenty percent or more of the
outstanding voting Units; or
(c) 100% (and not less than 100%) of the limited partnership
interests of the Borrower shall cease to be owned in the aggregate, directly or
indirectly, by the MLP and/or Valero.
"Change in Law" means (a) the adoption of any law, rule or regulation
after the Restatement Agreement Date, (b) any change in any law, rule or
regulation or in the interpretation or application thereof by any Governmental
Authority after the Restatement Agreement Date or (c) compliance by any Lender
or the Issuing Bank (or, for purposes of Section 2.13(b), by any lending office
of such Lender or by such Lender's or the Issuing Bank's holding company, if
any) with any request, guideline or directive (whether or not having the force
of law) of any Governmental Authority made or issued after the Restatement
Agreement Date.
"Class", when used in reference to any Loan or Borrowing, refers to
whether such Loan, or the Loans comprising such Borrowing, are General Revolving
Loans or Working Capital Revolving Loans.
"Code" means the Internal Revenue Code of 1986, as amended from time to
time.
"Commitment" means, with respect to each Lender, such Lender's General
Revolving Commitment and Working Capital Revolving Sub-Commitment. As of the
Restatement Effective Date, the aggregate amount of the Lenders' Commitments is
$175,000,000. The Working Capital Revolving Sub-Commitments are a subset of the
General Revolving Commitments and the maximum amount of the Commitments is equal
to the maximum amount of the General Revolving Commitments.
"Commitment Increase Effective Date" has the meaning assigned such term
in Section 2.18.
"Common Units" means the common units of limited partner interests in
the MLP.
4
"Consolidated Debt Coverage Ratio" means, for any day, the ratio of (a)
all Indebtedness of the Borrower and its Subsidiaries, on a consolidated basis,
as of the last day of the then most recent Rolling Period over (b) Consolidated
EBITDA for such Rolling Period.
"Consolidated EBITDA" means, without duplication, as to the Borrower
and its Subsidiaries, on a consolidated basis for each Rolling Period, the
amount equal to Consolidated Operating Income for such period plus (a)
depreciation and amortization for such period, and (b) cash distributions
received by the Borrower from Skelly-Belvieu Pipeline Company, and similar joint
ventures, during such period; provided that Consolidated EBITDA shall be
adjusted from time to time as necessary to give pro forma effect to permitted
acquisitions or Investments (other than Joint Venture Interests) or sales of
property by the Borrower and its Subsidiaries.
"Consolidated Interest Coverage Ratio" means, for any day, the ratio of
(i) Consolidated EBITDA for the then most recent Rolling Period to (ii)
Consolidated Interest Expense for such Rolling Period.
"Consolidated Interest Expense" means, for any Rolling Period, total
interest expense (including that attributable to Capital Lease Obligations) of
the Borrower and its Subsidiaries for such period with respect to all
outstanding Indebtedness of the Borrower and its Subsidiaries (including,
without limitation, all commissions, discounts and other fees and charges owed
with respect to letters of credit and bankers' acceptance financing and net
costs under any Hedging Agreements to the extent such net costs are allocable to
such period in accordance with GAAP).
"Consolidated Operating Income" means, as to the Borrower and its
Subsidiaries on a consolidated basis for each Rolling Period, the amount equal
to gross income minus operating expenses, general and administrative expenses,
depreciation and amortization, and taxes other than income taxes, in each case
for such period.
"Consolidated Tangible Net Worth" means, at any time, an amount equal
to (a) the consolidated partners' equity of the Borrower and its Subsidiaries,
plus (b) the aggregate amount of any non-cash write downs, on a consolidated
basis, of the Borrower and its Subsidiaries during the term hereof, less (c) the
sum of the amount of consolidated intangible assets of the Borrower and its
Subsidiaries as of the date of determination plus the aggregate amount of any
non-cash write ups, on a consolidated basis, of the Borrower and its
Subsidiaries during the term hereof.
"Control" means the possession, directly or indirectly, of the power to
direct or cause the direction of the management or policies of a Person, whether
through the ability to exercise voting power, by contract or otherwise.
"Controlling" and "Controlled" have meanings correlative thereto.
"Default" means any event or condition which constitutes an Event of
Default or which upon notice, lapse of time or both would, unless cured or
waived, become an Event of Default.
"Disclosed Matters" means the actions, suits and proceedings and the
environmental matters disclosed in Schedule 3.06.
"dollars" or "$" refers to lawful money of the United States of
America.
5
"Environmental Approvals" means any Governmental Approvals required
under applicable Environmental Laws.
"Environmental Laws" means all laws, rules, regulations, codes,
ordinances, orders, decrees, judgments, injunctions, notices or binding
agreements issued, promulgated or entered into by any Governmental Authority,
relating in any way to the environment, preservation or reclamation of natural
resources, the management, release or threatened release of any Hazardous
Material or to health and safety matters.
"Environmental Liability" means any liability, contingent or otherwise
(including any liability for damages, costs of environmental remediation, fines,
penalties or indemnities), of the Borrower or any Subsidiary directly or
indirectly resulting from or based upon (a) violation of any Environmental Law,
(b) the generation, use, handling, transportation, storage, treatment or
disposal of any Hazardous Materials, (c) exposure to any Hazardous Materials,
(d) the release or threatened release of any Hazardous Materials into the
environment or (e) any contract, agreement or other consensual arrangement
pursuant to which liability is assumed or imposed with respect to any of the
foregoing.
"Equity Interest" means any and all shares, interests, participations
or other equivalents (however designated) of capital stock of a corporation, any
member interests in a limited liability company, and general or limited
partnership interests in a partnership, any and all equivalent ownership
interests in a Person and any and all warrants, options or other rights to
purchase any of the foregoing. In addition, "Equity Interest" shall include,
without limitation, with respect to the Borrower, the limited partner interests
of the Borrower and the General Partner Interests and, with respect to the MLP,
the Units and the general partner interest of the MLP.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended from time to time.
"ERISA Affiliate" means any trade or business (whether or not
incorporated) that, together with the Borrower, is treated as a single employer
under Section 414(b) or (c) of the Code or, solely for purposes of Section 302
of ERISA and Section 412 of the Code, is treated as a single employer under
Section 414 of the Code.
"ERISA Event" means (a) any "reportable event", as defined in Section
4043 of ERISA or the regulations issued thereunder with respect to a Plan (other
than an event for which the 30-day notice period is waived); (b) the existence
with respect to any Plan of an "accumulated funding deficiency" (as defined in
Section 412 of the Code or Section 302 of ERISA), whether or not waived; (c) the
filing pursuant to Section 412(d) of the Code or Section 303(d) of ERISA of an
application for a waiver of the minimum funding standard with respect to any
Plan; (d) the incurrence by the Borrower or any of its ERISA Affiliates of any
liability under Title IV of ERISA with respect to the termination of any Plan;
(e) the receipt by the Borrower or any ERISA Affiliate from the PBGC or a plan
administrator of any notice relating to an intention to terminate any Plan or
Plans or to appoint a trustee to administer any Plan; (f) the incurrence by the
Borrower or any of its ERISA Affiliates of any liability with respect to the
withdrawal or partial withdrawal from any Plan or Multiemployer Plan; or (g) the
receipt by the Borrower
6
or any ERISA Affiliate of any notice, or the receipt by any Multiemployer Plan
from the Borrower or any ERISA Affiliate of any notice, concerning the
imposition of Withdrawal Liability or a determination that a Multiemployer Plan
is, or is expected to be, insolvent or in reorganization, within the meaning of
Title IV of ERISA.
"Eurodollar", when used in reference to any Loan or Borrowing, refers
to whether such Loan, or the Loans comprising such Borrowing, are bearing
interest at a rate determined by reference to the Adjusted LIBO Rate.
"Event of Default" has the meaning assigned to such term in Article
VII.
"Excluded Taxes" means, with respect to the Administrative Agent, any
Lender, the Issuing Bank or any other recipient of any payment to be made by or
on account of any obligation of the Borrower hereunder, (a) income or franchise
taxes imposed on (or measured by) its net income by the United States of
America, or by the jurisdiction under the laws of which such recipient is
organized or in which its principal office is located or, in the case of any
Lender, in which its applicable lending office is located, (b) any branch
profits taxes imposed by the United States of America or any similar tax imposed
by any other jurisdiction in which the Borrower is located and (c) in the case
of a Foreign Lender (other than an assignee pursuant to a request by the
Borrower under Section 2.17(b)), any withholding tax that is imposed on amounts
payable to such Foreign Lender at the time such Foreign Lender becomes a party
to this Agreement (or designates a new lending office) or is attributable to
such Foreign Lender's failure to comply with Section 2.15(e), except to the
extent that such Foreign Lender (or its assignor, if any) was entitled, at the
time of designation of a new lending office (or assignment), to receive
additional amounts from the Borrower with respect to such withholding tax
pursuant to Section 2.15(a).
"Federal Funds Effective Rate" means, for any day, the weighted average
(rounded upwards, if necessary, to the next 1/100 of 1%) of the rates on
overnight Federal funds transactions with members of the Federal Reserve System
arranged by Federal funds brokers, as published on the next succeeding Business
Day by the Federal Reserve Bank of New York, or, if such rate is not so
published for any day that is a Business Day, the average (rounded upwards, if
necessary, to the next 1/100 of 1%) of the quotations for such day for such
transactions received by the Administrative Agent from three Federal funds
brokers of recognized standing selected by it.
"Financial Officer" means the chief accounting and financial officer,
treasurer or controller of the Borrower.
"First Amendment" means that certain First Amendment to Credit
Agreement, dated as of February 23, 2001, by and among the Borrower, the Lenders
(as defined in the Original Agreement) party thereto, the Administrative Agent
(as defined in the Original Agreement), Royal Bank of Canada, as syndication
agent, and SunTrust Bank, as documentation agent.
"Foreign Lender" means any Lender that is organized under the laws of a
jurisdiction other than that in which the Borrower is located. For purposes of
this definition, the United States of America, each State thereof and the
District of Columbia shall be deemed to constitute a single jurisdiction.
7
"GAAP" means generally accepted accounting principles in the United
States of America.
"General Partner" means Valero GP, Inc., a Delaware corporation.
"General Partner Interest" means all general partner interests in the
Borrower.
"General Revolving Commitment" means, with respect to each Lender, the
commitment of such Lender to make General Revolving Loans and to acquire
participations in Letters of Credit hereunder, expressed as an amount
representing the maximum aggregate amount of such Lender's General Revolving
Credit Exposure hereunder, as such commitment may be (a) reduced from time to
time pursuant to Section 2.07, (b) increased from time to time pursuant to
Section 2.18 and (c) reduced or increased from time to time pursuant to
assignments by or to such Lender pursuant to Section 9.04. The amount of each
Lender's General Revolving Commitment as of the Restatement Effective Date is
set forth on Schedule 2.01, or the initial amount of each assignee Lender is set
forth in the Assignment and Acceptance pursuant to which such Lender shall have
assumed its General Revolving Commitment, as applicable. The aggregate amount of
the Lenders' General Revolving Commitments as of the Restatement Effective Date
is $175,000,000.
"General Revolving Credit Exposure" means, with respect to any Lender
at any time, the sum of the outstanding principal amount of such Lender's
General Revolving Loans and its LC Exposure at such time.
"General Revolving Loan" has the meaning assigned to such term in
Section 2.01(b).
"Governmental Authority" means the government of the United States of
America, any other nation or any political subdivision thereof, whether state or
local, and any agency, authority, instrumentality, regulatory body, court,
central bank or other entity exercising executive, legislative, judicial,
taxing, regulatory or administrative powers or functions of or pertaining to
government.
"Guarantee" of or by any Person (the "guarantor") means any obligation,
contingent or otherwise, of the guarantor guaranteeing or having the economic
effect of guaranteeing any Indebtedness or other obligation of any other Person
(the "primary obligor") in any manner, whether directly or indirectly, and
including any obligation of the guarantor, direct or indirect, (a) to purchase
or pay (or advance or supply funds for the purchase or payment of) such
Indebtedness or other obligation or to purchase (or to advance or supply funds
for the purchase of) any security for the payment thereof, (b) to purchase or
lease property, securities or services for the purpose of assuring the owner of
such Indebtedness or other obligation of the payment thereof, (c) to maintain
working capital, equity capital or any other financial statement condition or
liquidity of the primary obligor so as to enable the primary obligor to pay such
Indebtedness or other obligation or (d) as an account party in respect of any
letter of credit or letter of guaranty issued to support such Indebtedness or
obligation; provided, that the term Guarantee shall not include endorsements for
collection or deposit in the ordinary course of business.
"Guarantor" means each of the MLP and each Person that from time to
time executes and delivers a Subsidiary Guaranty.
8
"Hazardous Materials" means all explosive or radioactive substances or
wastes and all hazardous or toxic substances, wastes or other pollutants,
including petroleum or petroleum distillates, asbestos or asbestos containing
materials, polychlorinated biphenyls, radon gas, infectious or medical wastes
and all other substances or wastes of any nature regulated pursuant to any
Environmental Law.
"Hedging Agreement" means any interest rate protection agreement,
foreign currency exchange agreement, commodity price protection agreement or
other interest or currency exchange rate or commodity price hedging arrangement.
"Increasing Lender" has the meaning assigned to such term in Section
2.18.
"Indebtedness" of any Person means, without duplication, (a) all
obligations of such Person for borrowed money or with respect to deposits or
advances of any kind, (b) all obligations of such Person evidenced by bonds,
debentures, notes or similar instruments or by any other securities providing
for the mandatory payment of money (including, without limitation, preferred
stock subject to mandatory redemption or sinking fund provisions), (c) all
obligations of such Person upon which interest charges are customarily paid, (d)
all obligations of such Person under conditional sale or other title retention
agreements relating to property acquired by such Person, (e) all obligations of
such Person in respect of the deferred purchase price of property or services
(excluding current accounts payable incurred in the ordinary course of
business), (f) all Indebtedness of others secured by (or for which the holder of
such Indebtedness has an existing right, contingent or otherwise, to be secured
by) any Lien on property owned or acquired by such Person, whether or not the
Indebtedness secured thereby has been assumed, (g) all Guarantees by such Person
of Indebtedness of others, (h) all Capital Lease Obligations of such Person, (i)
all obligations, contingent or otherwise, of such Person as an account party in
respect of letters of credit and letters of guaranty, (j) all obligations,
contingent or otherwise, of such Person in respect of bankers' acceptances, (k)
all obligations of such Person with respect to any arrangement, directly or
indirectly, whereby such Person or its Subsidiaries shall sell or transfer any
material asset, and whereby such Person or any of its Subsidiaries shall then or
immediately thereafter rent or lease as lessee such asset or any part thereof,
(l) all recourse and support obligations of such Person or any of its
Subsidiaries with respect to the sale or discount of any of its accounts
receivable, and (m) all obligations of such Person or any of its Subsidiaries
with respect to any arrangement for the purchase of materials, supplies, other
property or services if such arrangement by its express terms requires that
payment be made by the Borrower or such Subsidiary regardless of whether such
materials, supplies, other property or services are delivered or furnished to
it. The Indebtedness of any Person shall include the Indebtedness of any other
entity (including any partnership in which such Person is a general partner) to
the extent such Person is liable therefor as a result of such Person's ownership
interest in or other relationship with such entity, except to the extent the
terms of such Indebtedness provide that such Person is not liable therefor.
"Indemnified Taxes" means Taxes other than Excluded Taxes.
"Indenture" means the Indenture, dated as of July 15, 2002, between the
Borrower, as Issuer, the MLP, as Guarantor, and The Bank of New York, as
Trustee, relating to the issuance
9
of senior debt securities, as amended, modified and supplemented from time to
time in accordance herewith.
"Index Debt" means senior, unsecured, long-term indebtedness for
borrowed money of the Borrower that is not guaranteed by any other Person or
subject to any other credit enhancement.
"Information Memorandum" means the Confidential Information Memorandum
dated December 2002 relating to the Borrower and the Transactions.
"Initial Notice of Commitment Increase" has the meaning assigned to
such term in Section 2.18.
"Interest Election Request" means a request by the Borrower to convert
or continue a Borrowing in accordance with Section 2.06.
"Interest Payment Date" means (a) with respect to any ABR Loan, the
last day of each March, June, September and December and (b) with respect to any
Eurodollar Loan, the last day of the Interest Period applicable to the Borrowing
of which such Loan is a part and, in the case of a Eurodollar Borrowing with an
Interest Period of more than three months' duration, each day prior to the last
day of such Interest Period that occurs at intervals of three months' duration
after the first day of such Interest Period.
"Interest Period" means with respect to any Eurodollar Borrowing, the
period commencing on the date of such Borrowing and ending on the numerically
corresponding day in the calendar month that is one, two, three or six-months
thereafter, as the Borrower may elect; provided, that (i) if any Interest Period
would end on a day other than a Business Day, such Interest Period shall be
extended to the next succeeding Business Day unless, in the case of a Eurodollar
Borrowing only, such next succeeding Business Day would fall in the next
calendar month, in which case such Interest Period shall end on the next
preceding Business Day and (ii) any Interest Period pertaining to a Eurodollar
Borrowing that commences on the last Business Day of a calendar month (or on a
day for which there is no numerically corresponding day in the last calendar
month of such Interest Period) shall end on the last Business Day of the last
calendar month of such Interest Period. For purposes hereof, the date of a
Borrowing initially shall be the date on which such Borrowing is made and, in
the case of a Borrowing, thereafter shall be the effective date of the most
recent conversion or continuation of such Borrowing.
"Investment" means, as applied to any Person, any direct or indirect
purchase or other acquisition by such Person of any Equity Interests in any
other Person, or any direct or indirect loan, advance or capital contribution by
such Person to any other Person, including all Indebtedness and receivables from
such other Person which are not current assets or did not arise from sales to
such other Person in the ordinary course of business, and any direct or indirect
purchase or other acquisition by such Person of any assets (other than any
acquisition of assets in the ordinary course of business).
"Issuing Bank" means JPMorgan Chase Bank, in its capacity as the issuer
of Letters of Credit hereunder, and its successors in such capacity as provided
in Section 2.04(i). The Issuing
10
Bank may, in its discretion, arrange for one or more Letters of Credit to be
issued by Affiliates of the Issuing Bank, in which case the term "Issuing Bank"
shall include any such Affiliate with respect to Letters of Credit issued by
such Affiliate.
"Joint Venture Interest" means an acquisition of or Investment in
Equity Interests in another Person, held directly or indirectly by the Borrower,
that will not be a Subsidiary after giving effect to such acquisition or
Investment.
"LC Disbursement" means a payment made by the Issuing Bank pursuant to
a Letter of Credit.
"LC Exposure" means, at any time, the sum of (a) the aggregate undrawn
amount of all outstanding Letters of Credit at such time plus (b) the aggregate
amount of all LC Disbursements that have not yet been reimbursed by or on behalf
of the Borrower at such time. The LC Exposure of any Lender at any time shall be
its Applicable Percentage of the total LC Exposure at such time.
"Lenders" means the Persons listed on Schedule 2.01 and any other
Person that shall have become a party hereto pursuant to an Assignment and
Acceptance, other than any such Person that ceases to be a party hereto pursuant
to an Assignment and Acceptance.
"Letter of Credit" means any letter of credit issued pursuant to this
Agreement.
"LIBO Rate" means, with respect to any Eurodollar Borrowing for any
Interest Period, the rate appearing on Page 3750 of the Telerate Service (or on
any successor or substitute page of such Service, or any successor to or
substitute for such Service, providing rate quotations comparable to those
currently provided on such page of such Service, as determined by the
Administrative Agent from time to time for purposes of providing quotations of
interest rates applicable to dollar deposits in the London interbank market) at
approximately 11:00 a.m., London time, two Business Days prior to the
commencement of such Interest Period, as the rate for dollar deposits with a
maturity comparable to such Interest Period. In the event that such rate is not
available at such time for any reason, then the "LIBO Rate" with respect to such
Eurodollar Borrowing for such Interest Period shall be the rate at which dollar
deposits of $5,000,000 and for a maturity comparable to such Interest Period are
offered by the principal London office of the Administrative Agent in
immediately available funds in the London interbank market at approximately
11:00 a.m., London time, two Business Days prior to the commencement of such
Interest Period.
"Lien" means, with respect to any asset, (a) any mortgage, deed of
trust, lien, pledge, hypothecation, encumbrance, charge or security interest in,
on or of such asset, (b) the interest of a vendor or a lessor under any
conditional sale agreement, capital lease or title retention agreement (or any
financing lease having substantially the same economic effect as any of the
foregoing) relating to such asset and (c) in the case of securities, any
purchase option, call or similar right of a third party with respect to such
securities.
"Loan" means each General Revolving Loan or each Working Capital
Revolving Loan.
11
"Loan Documents" means this Agreement, the Subsidiary Guaranty, any
notes issued pursuant to Section 2.08(e), any Letter of Credit, any Hedging
Agreement executed in connection with the Loans, as each such agreement may be
amended, supplemented or otherwise modified from time to time as permitted
hereby, and any and all instruments, certificates, or other agreements delivered
in connection with the foregoing.
"Material Adverse Effect" means a material adverse effect on (a) the
business, assets, operations or condition (financial or otherwise) of the
Borrower and its Subsidiaries taken as a whole, (b) the ability of the Borrower
to perform any of its obligations under this Agreement or (c) the rights of or
benefits available to the Lenders under this Agreement.
"Material Agreements" means the Partnership Agreement (Borrower), the
Transportation Agreement, the Omnibus Agreement, and the Indenture as each such
agreement may be amended, supplemented or otherwise modified from time to time
as permitted hereby.
"Material Indebtedness" means Indebtedness (other than the Loans and
Letters of Credit), or obligations in respect of one or more Hedging Agreements,
of any one or more of the Borrower and its Subsidiaries in an aggregate
principal amount exceeding $10,000,000. For purposes of determining Material
Indebtedness, the "principal amount" of the obligations of the Borrower or any
Subsidiary in respect of any Hedging Agreement at any time shall be the maximum
aggregate amount (giving effect to any netting agreements) that the Borrower or
such Subsidiary would be required to pay if such Hedging Agreement were
terminated at such time.
"Maturity Date" means January 15, 2006.
"MLP" means Valero, L.P., a Delaware limited partnership formerly known
as Shamrock Logistics, L.P.
"MLP Guaranty" means the Guarantee made by the MLP in favor of the
Administrative Agent for the benefit of the Lenders, substantially in the form
of Exhibit C-1 hereto, as the same may be amended, supplemented or otherwise
modified from time to time.
"Moody's" means Moody's Investors Service, Inc. (or any successor
rating organization).
"Multiemployer Plan" means a multiemployer plan as defined in Section
4001(a)(3) of ERISA.
"New Funds Amount" means the amount by which a New Lender's or an
Increasing Lender's outstanding Loans increase as of a Commitment Increase
Effective Date (without regard to any such increase as a result of Borrowings
made on such Commitment Increase Effective Date).
"New Lender" has the meaning assigned to such term in Section 2.18.
"Non-U.S. Subsidiary" means any Subsidiary organized under the laws of
any jurisdiction outside of the United States of America.
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"Notice of Confirmation of Commitment Increase" has the meaning
assigned to such term in Section 2.18.
"Omnibus Agreement" means the Omnibus Agreement among Valero (as
successor by merger to UDS), the General Partner, the MLP and the Borrower in
the form previously provided to the Lenders, as amended, modified and
supplemented from time to time in accordance herewith.
"Original Agreement" means the Credit Agreement, dated as of December
15, 2000, by and among Shamrock Logistics Operations, L.P., the Lenders (as
defined therein) party thereto, The Chase Manhattan Bank, as Administrative
Agent, Royal Bank of Canada, as syndication agent, and SunTrust Bank, as
documentation agent, as amended by the First Amendment and the Second Amendment.
"Original Agreement Date" means December 15, 2000.
"Original Effective Date" means the date on which the conditions
specified in Section 4.01 of the Original Agreement were satisfied (or waived in
accordance with Section 9.02).
"Other Taxes" means any and all present or future stamp or documentary
taxes or any other excise or property taxes, charges or similar levies arising
from any payment made hereunder or from the execution, delivery or enforcement
of, or otherwise with respect to, this Agreement.
"Partially Increasing Lender" has the meaning assigned to such term in
Section 2.18.
"Partnership Agreement (Borrower)" means the Agreement of Limited
Partnership of the Borrower among the General Partner and the MLP in the form
previously provided to the Lenders, as amended, modified and supplemented from
time to time in accordance herewith.
"Partnership Agreement (MLP)" means the Amended and Restated Agreement
of Limited Partnership of the MLP among its general partner and Todd Walker, as
the organizational limited partner, together with any other Persons who become
partners in such partnership, as amended, modified and supplemented from time to
time in accordance herewith.
"PBGC" means the Pension Benefit Guaranty Corporation referred to and
defined in ERISA and any successor entity performing similar functions.
"Permitted Encumbrances" means:
(a) Liens imposed by law for taxes that are not yet due or are
being contested in compliance with Section 5.04;
(b) carriers', warehousemen's, mechanics', materialmen's,
repairmen's and other like Liens imposed by law, arising in the ordinary course
of business and securing obligations that are not overdue by more than 30 days
or are being contested in compliance with Section 5.04;
13
(c) pledges and deposits made in the ordinary course of
business in compliance with workers' compensation, unemployment insurance and
other social security laws or regulations;
(d) deposits to secure the performance of bids, trade
contracts, leases, statutory obligations, surety and appeal bonds, performance
bonds and other obligations of a like nature, in each case in the ordinary
course of business;
(e) judgment liens in respect of judgments that do not
constitute an Event of Default under clause (k) of Article VII; and
(f) easements, zoning restrictions, rights-of-way and similar
encumbrances on real property imposed by law or arising in the ordinary course
of business that do not secure any monetary obligations and do not materially
detract from the value of the affected property or interfere with the ordinary
conduct of business of the Borrower or any Subsidiary;
provided that the term "Permitted Encumbrances" shall not include any Lien
securing Indebtedness.
"Permitted Investments" means:
(a) direct obligations of, or obligations the principal of and
interest on which are unconditionally guaranteed by, the United States of
America (or by any agency thereof to the extent such obligations are backed by
the full faith and credit of the United States of America), in each case
maturing within one year from the date of acquisition thereof;
(b) investments in commercial paper maturing within 270 days
from the date of acquisition thereof and having, at such date of acquisition,
the highest credit rating obtainable from S&P or from Moody's;
(c) investments in certificates of deposit, banker's
acceptances and time deposits maturing within 180 days from the date of
acquisition thereof issued or guaranteed by or placed with, and money market
deposit accounts issued or offered by, any domestic office of any commercial
bank organized under the laws of the United States of America or any State
thereof which has a combined capital and surplus and undivided profits of not
less than $500,000,000; and
(d) fully collateralized repurchase agreements with a term of
not more than 30 days for securities described in clause (a) above and entered
into with a financial institution satisfying the criteria described in clause
(c) above.
"Person" means any natural person, corporation, limited liability
company, trust, joint venture, association, company, partnership, Governmental
Authority or other entity.
"Plan" means any employee pension benefit plan (other than a
Multiemployer Plan) subject to the provisions of Title IV of ERISA or Section
412 of the Code or Section 302 of ERISA, and in respect of which the Borrower or
any ERISA Affiliate is (or, if such plan were
14
terminated, would under Section 4069 of ERISA be deemed to be) an "employer" as
defined in Section 3(5) of ERISA.
"Prime Rate" means the rate of interest per annum publicly announced
from time to time by JPMorgan Chase Bank as its prime rate in effect at its
principal office in New York City; each change in the Prime Rate shall be
effective from and including the date such change is publicly announced as being
effective.
"Reducing Lender" has the meaning assigned to such term in Section
2.18.
"Reduction Amount" means the amount by which a Reducing Lender's or a
Partially Increasing Lender's outstanding Loans decrease as of a Commitment
Increase Effective Date (without regard to any such increase as a result of
Borrowings made on such Commitment Increase Effective Date).
"Refinery Assets" means the refineries and related assets of Valero or
its Affiliates commonly referred to as the McKee, Three Rivers and Ardmore
refineries.
"Register" has the meaning set forth in Section 9.04.
"Related Parties" means, with respect to any specified Person, such
Person's Affiliates and the respective directors, officers, employees, agents
and advisors of such Person and such Person's Affiliates.
"Required Lenders" means, at any time, Lenders having Revolving Credit
Exposures and unused Commitments representing at least 66 2/3% of the sum of the
total Revolving Credit Exposures and unused Commitments at such time.
"Restatement Agreement Date" means March 6, 2003.
"Restatement Effective Date" means the date on which the conditions set
forth in Section 4.01 are first satisfied or waived, which shall occur on or
prior to March 6, 2003.
"Restricted Payment" means any dividend or other distribution (whether
in cash, securities or other property, with the exception of a Unit split,
combination, or dividend, in each case so long as the only consideration paid in
connection therewith is an in-kind payment of additional Units) with respect to
any Equity Interest of the Borrower or any Subsidiary, or any payment (whether
in cash, securities or other property, with the exception of a Unit split,
combination, or dividend, in each case so long as the only consideration paid in
connection therewith is an in-kind payment of additional Units), including any
sinking fund or similar deposit, on account of the purchase, redemption,
retirement, acquisition, cancellation or termination of any such Equity Interest
of the Borrower or any option, warrant or other right to acquire any such Equity
Interest of the Borrower.
"Revolving Credit Exposure" means, with respect to any Lender at any
time, the sum of the outstanding principal amount of such Lender's Working
Capital Revolving Loans and its General Revolving Credit Exposure at such time.
15
"Rolling Period" means any period of four consecutive fiscal quarters.
"S&P" means Standard & Poor's Ratings Group, a division of McGraw-Hill
Companies, Inc. (or any successor rating organization).
"Second Amendment" means that certain Second Amendment to Credit
Agreement, dated as of May 21, 2002, by and among the Borrower, the Lenders (as
defined in the Original Agreement), the Administrative Agent, Royal Bank of
Canada, as syndication agent and SunTrust Bank, as documentation agent.
"Statutory Reserve Rate" means a fraction (expressed as a decimal), the
numerator of which is the number one and the denominator of which is the number
one minus the aggregate of the maximum reserve percentages (including any
marginal, special, emergency or supplemental reserves) expressed as a decimal
established by the Board to which the Administrative Agent is subject (a) with
respect to the Base CD Rate, for new negotiable nonpersonal time deposits in
dollars of over $100,000 with maturities approximately equal to three months, in
the case of the Base CD Rate, and (b) with respect to the Adjusted LIBO Rate,
for eurocurrency funding (currently referred to as "Eurocurrency Liabilities" in
Regulation D of the Board). Such reserve percentages shall include those imposed
pursuant to such Regulation D. Eurodollar Loans shall be deemed to constitute
eurocurrency funding and to be subject to such reserve requirements without
benefit of or credit for proration, exemptions or offsets that may be available
from time to time to any Lender under such Regulation D or any comparable
regulation. The Statutory Reserve Rate shall be adjusted automatically on and as
of the effective date of any change in any reserve percentage.
"Subordinated Units" means the subordinated units of limited partner
interests in the MLP.
"Subsidiary Guaranty" means any guaranty executed and delivered
pursuant to Section 5.11, as from time to time amended, modified, or
supplemented.
"subsidiary" means, with respect to any Person (the "parent") at any
date, any corporation, limited liability company, partnership, association or
other entity the accounts of which would be consolidated with those of the
parent in the parent's consolidated financial statements if such financial
statements were prepared in accordance with GAAP as of such date, as well as any
other corporation, limited liability company, partnership, association or other
entity (a) of which securities or other ownership interests representing more
than 50% of the equity or more than 50% of the ordinary voting power or, in the
case of a partnership, more than 50% of the general partnership interests are,
as of such date, owned, controlled or held, or (b) that is, as of such date,
otherwise Controlled, by the parent or one or more subsidiaries of the parent or
by the parent and one or more subsidiaries of the parent.
"Subsidiary" means any subsidiary of the Borrower; provided that the
Skelly-Belvieu Pipeline Company shall not be a Subsidiary.
"Taxes" means any and all present or future taxes, levies, imposts,
duties, deductions, charges or withholdings imposed by any Governmental
Authority.
16
"Transactions" means the execution, delivery and performance by the
Borrower of the Original Agreement, this Agreement, the borrowing of Loans, the
use of the proceeds thereof and the issuance of Letters of Credit hereunder, and
the execution, delivery and performance of the Subsidiary Guaranty (if any).
"Transportation Agreement" means the Pipeline and Terminals Usage
Agreement by and among UDS and certain of its Affiliates and the Borrower dated
effective July 1, 2000.
"Type", when used in reference to any Loan or Borrowing, refers to
whether the rate of interest on such Loan, or on the Loans comprising such
Borrowing, is determined by reference to the Adjusted LIBO Rate or the Alternate
Base Rate.
"UDS" means Ultramar Diamond Shamrock Corporation, a Delaware
corporation.
"Units" means the collective reference to the Common Units and the
Subordinated Units.
"Valero" means Valero Energy Corporation, a Delaware corporation.
"Valero Asset Transaction" means a single aggregate transaction
consummated on or before the 60th day after the Restatement Effective Date,
whereby the Borrower will incur Loans and other Indebtedness some or all of the
proceeds of which will be used to make Restricted Payments to the MLP, the MLP
will raise cash through a public offering of Common Units, and the MLP will use
the proceeds of such Restricted Payments and such offering to redeem certain
Common Units and to enable the Borrower to have assets contributed to it by
Valero or its Affiliates. The Valero Asset Transaction must meet the following
criteria: (a) before and after such transaction, no Default shall have occurred
or be continuing or would result therefrom, (b) the transaction shall be at
prices and on terms and conditions no less favorable to the Borrower than could
be obtained on an arms length basis from unrelated third parties, (c) the Loans
incurred in connection with such transaction shall not exceed $100,000,000, (d)
the fair market value of assets contributed to the Borrower or its Subsidiaries
pursuant to such transaction must equal or exceed the amount of the Restricted
Payments made by the Borrower in connection with such transaction, and (e) the
public offering of Common Units pursuant to the transaction will be completed
prior to or simultaneously with the redemption of Common Units pursuant to the
transaction.
"Wholly-Owned Subsidiary" means, in respect of any Person, any
subsidiary of such Person, all of the Equity Interests of which (other than
director's qualifying shares, as may be required by law) is owned by such
Person, either directly or indirectly through one or more Wholly-Owned
Subsidiaries of such Person.
"Withdrawal Liability" means liability to a Multiemployer Plan as a
result of a complete or partial withdrawal from such Multiemployer Plan, as such
terms are defined in Part I of Subtitle E of Title IV of ERISA.
"Working Capital Revolving Sub-Commitment" means, with respect to each
Lender, the commitment of such Lender to make Working Capital Revolving Loans
hereunder, expressed as an amount representing the maximum aggregate amount of
such Lender's Working Capital Loans hereunder, as such commitment may be (a)
reduced from time to time pursuant to Section 2.07, (b) reduced or increased
from time to time pursuant to Section 2.18, and (c) reduced or increased from
time to time pursuant to assignments by or to such Lender pursuant to Section
9.04. The initial aggregate amount of the Lenders' Working Capital Revolving
Sub-Commitments is $40,000,000. The Working Capital Revolving Sub-Commitments
are a subset of the General Revolving Commitments and the aggregate amount of
the Commitments is equal
17
to the aggregate amount of the total General Revolving Commitments. Each
Lender's Working Capital Revolving Sub-Commitment shall be pro rata to its
Applicable Percentage of the total Commitments.
"Working Capital Revolving Loan" has the meaning assigned to such term
in Section 2.01.
SECTION 1.02. Classification of Loans and Borrowings. For purposes of
this Agreement, Loans may be classified and referred to by Class (e.g., a
"General Revolving Loan") or by Type (e.g., a "Eurodollar Loan"). Borrowings
also may be classified and referred to by Class (e.g., a "General Revolving
Borrowing") or by Type (e.g., a "Eurodollar Borrowing").
SECTION 1.03. Terms Generally. The definitions of terms herein shall
apply equally to the singular and plural forms of the terms defined. Whenever
the context may require, any pronoun shall include the corresponding masculine,
feminine and neuter forms. The words "include", "includes" and "including" shall
be deemed to be followed by the phrase "without limitation". The word "will"
shall be construed to have the same meaning and effect as the word "shall".
Unless the context requires otherwise (a) any definition of or reference to any
agreement, instrument or other document herein shall be construed as referring
to such agreement, instrument or other document as from time to time amended,
supplemented or otherwise modified (subject to any restrictions on such
amendments, supplements or modifications set forth herein), (b) any reference
herein to any Person shall be construed to include such Person's successors and
assigns, (c) the words "herein", "hereof" and "hereunder", and words of similar
import, shall be construed to refer to this Agreement in its entirety and not to
any particular provision hereof, (d) all references herein to Articles,
Sections, Exhibits and Schedules shall be construed to refer to Articles and
Sections of, and Exhibits and Schedules to, this Agreement and (e) the words
"asset" and "property" shall be construed to have the same meaning and effect
and to refer to any and all tangible and intangible assets and properties,
including cash, securities, accounts and contract rights.
SECTION 1.04. Accounting Terms; GAAP. Except as otherwise expressly
provided herein, all terms of an accounting or financial nature shall be
construed in accordance with GAAP, as in effect from time to time; provided
that, if the Borrower notifies the Administrative Agent that the Borrower
requests an amendment to any provision hereof to eliminate the effect of any
change occurring after the date hereof in GAAP or in the application thereof on
the operation of such provision (or if the Administrative Agent notifies the
Borrower that the Required Lenders request an amendment to any provision hereof
for such purpose), regardless of whether any such notice is given before or
after such change in GAAP or in the application thereof, then such provision
shall be interpreted on the basis of GAAP as in effect and applied immediately
before such change shall have become effective until such notice shall have been
withdrawn or such provision amended in accordance herewith.
ARTICLE II
The Credits
SECTION 2.01. Commitments. (a) Subject to the terms and conditions set
forth herein, each Lender agrees to make revolving credit loans (the "General
Revolving Loans") to the
18
Borrower from time to time during the Availability Period, in an aggregate
principal amount that will not result in (i) such Lender's Revolving Credit
Exposure exceeding such Lender's General Revolving Commitment or (ii) the sum of
the total Revolving Credit Exposures exceeding the total General Revolving
Commitments.
(b) Subject to the terms and conditions set forth herein,
including, without limitation, Section 5.08, each Lender agrees to make
revolving credit loans (the "Working Capital Revolving Loans") to the Borrower
from time to time during the Availability Period, in an aggregate principal
amount that will not result in (i) such Lender's Working Capital Revolving Loans
exceeding such Lender's Working Capital Revolving Sub-Commitment, (ii) the sum
of the total Working Capital Revolving Loans exceeding the total Working Capital
Revolving Sub-Commitments, or (iii) the sum of the total Revolving Credit
Exposure exceeding the total General Revolving Commitments.
(c) The Working Capital Revolving Sub-Commitment of each
Lender constitutes a subset of such Lender's General Revolving Commitment such
that the availability of (i) the General Revolving Commitment of such Lender
shall be reduced by the outstanding principal amount of such Lender's Working
Capital Revolving Loans as of the time of determination and (ii) the Working
Capital Revolving Sub-Commitment of each Lender shall be reduced by the amount,
if any, by which (A) the outstanding principal amount of such Lender's General
Revolving Credit Exposure as of the time of determination exceeds (B) the amount
equal to such Lender's General Revolving Commitment minus such Lender's Working
Capital Revolving Sub-Commitment. The sum of the total Revolving Credit
Exposures shall not exceed at any time the total General Revolving Commitments.
(d) Within the foregoing limits and subject to the terms and
conditions set forth herein, the Borrower may borrow, prepay and reborrow Loans
during the Availability Period.
SECTION 2.02. Loans and Borrowings. (a) Each Loan shall be made as part
of a Borrowing comprised entirely of General Revolving Loans or Working Capital
Revolving Loans as the Borrower may request in accordance herewith and made by
the Lenders ratably in accordance with their respective Commitments. The failure
of any Lender to make any Loan required to be made by it shall not relieve any
other Lender of its obligations hereunder; provided that the Commitments of the
Lenders are several and no Lender shall be responsible for any other Lender's
failure to make Loans as required.
(b) Subject to Section 2.12, each Borrowing shall be comprised
entirely of ABR Loans or Eurodollar Loans as the Borrower may request in
accordance herewith. Each Lender at its option may make any Eurodollar Loan by
causing any domestic or foreign branch or Affiliate of such Lender to make such
Loan; provided that any exercise of such option shall not affect the obligation
of the Borrower to repay such Loan in accordance with the terms of this
Agreement.
(c) At the commencement of each Interest Period for any
Eurodollar Borrowing, such Borrowing shall be in an aggregate amount that is an
integral multiple of $1,000,000 and not less than $5,000,000. At the time that
each ABR Borrowing is made, such
19
Borrowing shall be in an aggregate amount that is an integral multiple of
$500,000 and not less than $1,000,000; provided that an ABR Borrowing may be in
an aggregate amount that is equal to (i) with respect to Working Capital
Revolving Borrowings, the entire unused and available balance of the Working
Capital Revolving Sub-Commitments, (ii) with respect to General Revolving
Borrowings, (A) the total General Revolving Commitments less total Revolving
Credit Exposure, or (B) the amount that is required to finance the reimbursement
of an LC Disbursement as contemplated by Section 2.04(e). Borrowings of more
than one Type and Class may be outstanding at the same time; provided that there
shall not at any time be more than a total of five Eurodollar Borrowings
outstanding.
(d) Notwithstanding any other provision of this Agreement, the
Borrower shall not be entitled to request, or to elect to convert or continue,
any Borrowing if the Interest Period requested with respect thereto would end
after the Maturity Date.
SECTION 2.03. Requests for Borrowings. To request a Borrowing, the
Borrower shall notify the Administrative Agent of such request by telephone (a)
in the case of a Eurodollar Borrowing, not later than 11:00 a.m., New York City
time, three Business Days before the date of the proposed Borrowing or (b) in
the case of an ABR Borrowing, not later than 11:00 a.m., New York City time, one
Business Day before the date of the proposed Borrowing; provided that any such
notice of an ABR Borrowing to finance the reimbursement of an LC Disbursement as
contemplated by Section 2.04(e) may be given not later than 10:00 a.m., New York
City time, on the date of the proposed Borrowing. Each such telephonic Borrowing
Request shall be irrevocable and shall be confirmed promptly by hand delivery or
telecopy to the Administrative Agent of a written Borrowing Request in a form
approved by the Administrative Agent and signed by the Borrower. Each such
telephonic and written Borrowing Request shall specify the following information
in compliance with Section 2.02:
(i) the aggregate amount of the requested Borrowing;
(ii) the date of such Borrowing, which shall be a
Business Day;
(iii) whether such Borrowing is to be comprised of
Working Capital Revolving Loans or General Revolving Loans;
(iv) whether such Borrowing is to be an ABR Borrowing
or a Eurodollar Borrowing;
(v) in the case of a Eurodollar Borrowing, the
initial Interest Period to be applicable thereto, which shall be a period
contemplated by the definition of the term "Interest Period"; and
(vi) the location and number of the Borrower's
account to which funds are to be disbursed, which shall comply with the
requirements of Section 2.05.
If no election as to the Type of Borrowing is specified, then the requested
Borrowing shall be an ABR Borrowing. If no election as to the Class of Borrowing
is specified, then the requested Borrowing shall be a General Revolving
Borrowing. If no Interest Period is specified with respect to any requested
Eurodollar Borrowing, then the Borrower shall be deemed to have
20
selected an Interest Period of one month's duration. Promptly following receipt
of a Borrowing Request in accordance with this Section, the Administrative Agent
shall advise each Lender of the details thereof and of the amount of such
Lender's Loan to be made as part of the requested Borrowing.
SECTION 2.04. Letters of Credit.
(a) General. Subject to the terms and conditions set forth
herein, the Borrower may request the issuance of Letters of Credit for its own
account, in a form reasonably acceptable to the Administrative Agent and the
Issuing Bank, at any time and from time to time during the Availability Period.
In the event of any inconsistency between the terms and conditions of this
Agreement and the terms and conditions of any form of letter of credit
application or other agreement submitted by the Borrower to, or entered into by
the Borrower with, the Issuing Bank relating to any Letter of Credit, the terms
and conditions of this Agreement shall control.
(b) Notice of Issuance, Amendment, Renewal, Extension; Certain
Conditions. To request the issuance of a Letter of Credit (or the amendment,
renewal or extension of an outstanding Letter of Credit), the Borrower shall
hand deliver or telecopy (or transmit by electronic communication, if
arrangements for doing so have been approved by the Issuing Bank) to the Issuing
Bank and the Administrative Agent (reasonably in advance of the requested date
of issuance, amendment, renewal or extension) a notice requesting the issuance
of a Letter of Credit, or identifying the Letter of Credit to be amended,
renewed or extended, and specifying the date of issuance, amendment, renewal or
extension (which shall be a Business Day), the date on which such Letter of
Credit is to expire (which shall comply with paragraph (c) of this Section), the
amount of such Letter of Credit, the name and address of the beneficiary thereof
and such other information as shall be necessary to prepare, amend, renew or
extend such Letter of Credit. If requested by the Issuing Bank, the Borrower
also shall submit a letter of credit application on the Issuing Bank's standard
form in connection with any request for a Letter of Credit. A Letter of Credit
shall be issued, amended, renewed or extended only if (and upon issuance,
amendment, renewal or extension of each Letter of Credit the Borrower shall be
deemed to represent and warrant that), after giving effect to such issuance,
amendment, renewal or extension (i) the LC Exposure shall not exceed $75,000,000
and (ii) the sum of the total Revolving Credit Exposures shall not exceed the
total General Revolving Commitments.
(c) Expiration Date. Each Letter of Credit shall expire at or
prior to the close of business on the date that is five Business Days prior to
the Maturity Date.
(d) Participations. By the issuance of a Letter of Credit (or
an amendment to a Letter of Credit increasing the amount thereof) and without
any further action on the part of the Issuing Bank or the Lenders, the Issuing
Bank hereby grants to each Lender, and each Lender hereby acquires from the
Issuing Bank, a participation in such Letter of Credit equal to such Lender's
Applicable Percentage of the aggregate amount available to be drawn under such
Letter of Credit. In consideration and in furtherance of the foregoing, each
Lender hereby absolutely and unconditionally agrees to pay to the Administrative
Agent, for the account of the Issuing Bank, such Lender's Applicable Percentage
of each LC Disbursement made by the Issuing Bank and not reimbursed by the
Borrower on the date due as provided in paragraph (e) of this Section,
21
or of any reimbursement payment required to be refunded to the Borrower for any
reason. Each Lender acknowledges and agrees that its obligation to acquire
participations pursuant to this paragraph in respect of Letters of Credit is
absolute and unconditional and shall not be affected by any circumstance
whatsoever, including any amendment, renewal or extension of any Letter of
Credit or the occurrence and continuance of a Default or reduction or
termination of the Commitments, and that each such payment shall be made without
any offset, abatement, withholding or reduction whatsoever.
(e) Reimbursement. If the Issuing Bank shall make any LC
Disbursement in respect of a Letter of Credit, the Borrower shall reimburse such
LC Disbursement by paying to the Administrative Agent an amount equal to such LC
Disbursement not later than 12:00 noon, New York City time, on the date that
such LC Disbursement is made, if the Borrower shall have received notice of such
LC Disbursement prior to 10:00 a.m., New York City time, on such date, or, if
such notice has not been received by the Borrower prior to such time on such
date, then not later than 12:00 noon, New York City time, on (i) the Business
Day that the Borrower receives such notice, if such notice is received prior to
10:00 a.m., New York City time, on the day of receipt, or (ii) the Business Day
immediately following the day that the Borrower receives such notice, if such
notice is not received prior to such time on the day of receipt; provided that
the Borrower may, subject to the conditions to borrowing set forth herein,
request in accordance with Section 2.03 that such payment be financed with an
ABR Borrowing in an equivalent amount and, to the extent so financed, the
Borrower's obligation to make such payment shall be discharged and replaced by
the resulting ABR Borrowing. If the Borrower fails to make such payment when
due, the Administrative Agent shall notify each Lender of the applicable LC
Disbursement, the payment then due from the Borrower in respect thereof and such
Lender's Applicable Percentage thereof. Promptly following receipt of such
notice, each Lender shall pay to the Administrative Agent its Applicable
Percentage of the payment then due from the Borrower, in the same manner as
provided in Section 2.05 with respect to Loans made by such Lender (and Section
2.05 shall apply, mutatis mutandis, to the payment obligations of the Lenders),
and the Administrative Agent shall promptly pay to the Issuing Bank the amounts
so received by it from the Lenders. Promptly following receipt by the
Administrative Agent of any payment from the Borrower pursuant to this
paragraph, the Administrative Agent shall distribute such payment to the Issuing
Bank or, to the extent that Lenders have made payments pursuant to this
paragraph to reimburse the Issuing Bank, then to such Lenders and the Issuing
Bank as their interests may appear. Any payment made by a Lender pursuant to
this paragraph to reimburse the Issuing Bank for any LC Disbursement (other than
the funding of ABR Loans as contemplated above) shall not constitute a Loan and
shall not relieve the Borrower of its obligation to reimburse such LC
Disbursement.
(f) Obligations Absolute. The Borrower's obligation to
reimburse LC Disbursements as provided in paragraph (e) of this Section shall be
absolute, unconditional and irrevocable, and shall be performed strictly in
accordance with the terms of this Agreement under any and all circumstances
whatsoever and irrespective of (i) any lack of validity or enforceability of any
Letter of Credit or this Agreement, or any term or provision therein, (ii) any
draft or other document presented under a Letter of Credit proving to be forged,
fraudulent or invalid in any respect or any statement therein being untrue or
inaccurate in any respect, (iii) payment by the Issuing Bank under a Letter of
Credit against presentation of a draft or other document that does not comply
with the terms of such Letter of Credit, or (iv) any other event or circumstance
22
whatsoever, whether or not similar to any of the foregoing, that might, but for
the provisions of this Section, constitute a legal or equitable discharge of, or
provide a right of setoff against, the Borrower's obligations hereunder. Neither
the Administrative Agent, the Lenders nor the Issuing Bank, nor any of their
Related Parties, shall have any liability or responsibility by reason of or in
connection with the issuance or transfer of any Letter of Credit or any payment
or failure to make any payment thereunder (irrespective of any of the
circumstances referred to in the preceding sentence), or any error, omission,
interruption, loss or delay in transmission or delivery of any draft, notice or
other communication under or relating to any Letter of Credit (including any
document required to make a drawing thereunder), any error in interpretation of
technical terms or any consequence arising from causes beyond the control of the
Issuing Bank; provided that the foregoing shall not be construed to excuse the
Issuing Bank from liability to the Borrower to the extent of any direct damages
(as opposed to consequential damages, claims in respect of which are hereby
waived by the Borrower to the extent permitted by applicable law) suffered by
the Borrower that are caused by the Issuing Bank's failure to exercise care when
determining whether drafts and other documents presented under a Letter of
Credit comply with the terms thereof. The parties hereto expressly agree that,
in the absence of gross negligence or willful misconduct on the part of the
Issuing Bank (as finally determined by a court of competent jurisdiction), the
Issuing Bank shall be deemed to have exercised care in each such determination.
In furtherance of the foregoing and without limiting the generality thereof, the
parties agree that, with respect to documents presented which appear on their
face to be in substantial compliance with the terms of a Letter of Credit, the
Issuing Bank may, in its sole discretion, either accept and make payment upon
such documents without responsibility for further investigation, regardless of
any notice or information to the contrary, or refuse to accept and make payment
upon such documents if such documents are not in strict compliance with the
terms of such Letter of Credit.
(g) Disbursement Procedures. The Issuing Bank shall, promptly
following its receipt thereof, examine all documents purporting to represent a
demand for payment under a Letter of Credit. The Issuing Bank shall promptly
notify the Administrative Agent and the Borrower by telephone (confirmed by
telecopy) of such demand for payment and whether the Issuing Bank has made or
will make an LC Disbursement thereunder; provided that any failure to give or
delay in giving such notice shall not relieve the Borrower of its obligation to
reimburse the Issuing Bank and the Lenders with respect to any such LC
Disbursement.
(h) Interim Interest. If the Issuing Bank shall make any LC
Disbursement, then, unless the Borrower shall reimburse such LC Disbursement in
full on the date such LC Disbursement is made, the unpaid amount thereof shall
bear interest, for each day from and including the date such LC Disbursement is
made to but excluding the date that the Borrower reimburses such LC
Disbursement, at the rate per annum then applicable to ABR Loans; provided that,
if the Borrower fails to reimburse such LC Disbursement when due pursuant to
paragraph (e) of this Section, then Section 2.11(c) shall apply. Interest
accrued pursuant to this paragraph shall be for the account of the Issuing Bank,
except that interest accrued on and after the date of payment by any Lender
pursuant to paragraph (e) of this Section to reimburse the Issuing Bank shall be
for the account of such Lender to the extent of such payment.
(i) Replacement of the Issuing Bank. The Issuing Bank may be
replaced at any time by written agreement among the Borrower, the Administrative
Agent, the replaced
23
Issuing Bank and the successor Issuing Bank. The Administrative Agent shall
notify the Lenders of any such replacement of the Issuing Bank. At the time any
such replacement shall become effective, the Borrower shall pay all unpaid fees
accrued for the account of the replaced Issuing Bank pursuant to Section
2.10(b). From and after the effective date of any such replacement, (i) the
successor Issuing Bank shall have all the rights and obligations of the Issuing
Bank under this Agreement with respect to Letters of Credit to be issued
thereafter and (ii) references herein to the term "Issuing Bank" shall be deemed
to refer to such successor or to any previous Issuing Bank, or to such successor
and all previous Issuing Banks, as the context shall require. After the
replacement of an Issuing Bank hereunder, the replaced Issuing Bank shall remain
a party hereto and shall continue to have all the rights and obligations of an
Issuing Bank under this Agreement with respect to Letters of Credit issued by it
prior to such replacement, but shall not be required to issue additional Letters
of Credit.
(j) Cash Collateralization. If any Event of Default shall
occur and be continuing, on the Business Day that the Borrower receives notice
from the Administrative Agent or the Required Lenders (or, if the maturity of
the Loans has been accelerated, Lenders with LC Exposure representing greater
than 66 2/3% of the total LC Exposure) demanding the deposit of cash collateral
pursuant to this paragraph, the Borrower shall deposit in an account with the
Administrative Agent, in the name of the Administrative Agent and for the
benefit of the Lenders, an amount in cash equal to the LC Exposure as of such
date plus any accrued and unpaid interest thereon; provided that the obligation
to deposit such cash collateral shall become effective immediately, and such
deposit shall become immediately due and payable, without demand or other notice
of any kind, upon the occurrence of any Event of Default with respect to the
Borrower described in clause (h) or (i) of Article VII. Such deposit shall be
held by the Administrative Agent as collateral for the payment and performance
of the obligations of the Borrower under this Agreement. The Administrative
Agent shall have exclusive dominion and control, including the exclusive right
of withdrawal, over such account. Other than any interest earned on the
investment of such deposits, which investments shall be made at the option and
sole discretion of the Administrative Agent and at the Borrower's risk and
expense, such deposits shall not bear interest. Interest or profits, if any, on
such investments shall accumulate in such account. Moneys in such account shall
be applied by the Administrative Agent to reimburse the Issuing Bank for LC
Disbursements for which it has not been reimbursed and, to the extent not so
applied, shall be held for the satisfaction of the reimbursement obligations of
the Borrower for the LC Exposure at such time or, if the maturity of the Loans
has been accelerated (but subject to the consent of Lenders with LC Exposure
representing greater than 66 2/3% of the total LC Exposure), be applied to
satisfy other obligations of the Borrower under this Agreement. If the Borrower
is required to provide an amount of cash collateral hereunder as a result of the
occurrence of an Event of Default, such amount (to the extent not applied as
aforesaid) shall be returned to the Borrower within three Business Days after
all Events of Default have been cured or waived.
SECTION 2.05. Funding of Borrowings. (a) Each Lender shall make each
Loan to be made by it hereunder on the proposed date thereof by wire transfer of
immediately available funds by 12:00 noon, New York City time, to the account of
the Administrative Agent most recently designated by it for such purpose by
notice to the Lenders. The Administrative Agent will make such Loans available
to the Borrower by promptly crediting the amounts so received, in like funds, to
an account of the Borrower maintained with the Administrative Agent in New
24
York City and designated by the Borrower in the applicable Borrowing Request;
provided that ABR Loans made to finance the reimbursement of an LC Disbursement
as provided in Section 2.04(e) shall be remitted by the Administrative Agent to
the Issuing Bank.
(a) Unless the Administrative Agent shall have received notice
from a Lender prior to the proposed date of any Borrowing that such Lender will
not make available to the Administrative Agent such Lender's share of such
Borrowing, the Administrative Agent may assume that such Lender has made such
share available on such date in accordance with paragraph (a) of this Section
and may, in reliance upon such assumption, make available to the Borrower a
corresponding amount. In such event, if a Lender has not in fact made its share
of the applicable Borrowing available to the Administrative Agent, then the
applicable Lender and the Borrower severally agree to pay to the Administrative
Agent forthwith on demand such corresponding amount with interest thereon, for
each day from and including the date such amount is made available to the
Borrower to but excluding the date of payment to the Administrative Agent, at
(i) in the case of such Lender, the greater of the Federal Funds Effective Rate
and a rate determined by the Administrative Agent in accordance with banking
industry rules on interbank compensation or (ii) in the case of the Borrower,
the interest rate applicable to ABR Loans. If such Lender pays such amount to
the Administrative Agent, then such amount shall constitute such Lender's Loan
included in such Borrowing.
SECTION 2.06. Interest Elections. (a) Each Borrowing initially shall be
of the Type specified in the applicable Borrowing Request and, in the case of a
Eurodollar Borrowing, shall have an initial Interest Period as specified in such
Borrowing Request. Thereafter, the Borrower may elect to convert such Borrowing
to a different Type or to continue such Borrowing and, in the case of a
Eurodollar Borrowing, may elect Interest Periods therefor, all as provided in
this Section. The Borrower may elect different options with respect to different
portions of the affected Borrowing, in which case each such portion shall be
allocated ratably among the Lenders holding the Loans comprising such Borrowing,
and the Loans comprising each such portion shall be considered a separate
Borrowing.
(b) To make an election pursuant to this Section, the Borrower
shall notify the Administrative Agent of such election by telephone by the time
that a Borrowing Request would be required under Section 2.03 if the Borrower
were requesting a Borrowing of the Type resulting from such election to be made
on the effective date of such election. Each such telephonic Interest Election
Request shall be irrevocable and shall be confirmed promptly by hand delivery or
telecopy to the Administrative Agent of a written Interest Election Request in a
form approved by the Administrative Agent and signed by the Borrower.
(c) Each telephonic and written Interest Election Request
shall specify the following information in compliance with Section 2.02:
(i) the Borrowing to which such Interest Election
Request applies and, if different options are being elected with respect to
different portions thereof, the portions thereof to be allocated to each
resulting Borrowing (in which case the information to be specified pursuant to
clauses (iii) and (iv) below shall be specified for each resulting Borrowing);
25
(ii) the effective date of the election made pursuant
to such Interest Election Request, which shall be a Business Day;
(iii) whether the resulting Borrowing is to be an ABR
Borrowing or a Eurodollar Borrowing; and
(iv) if the resulting Borrowing is a Eurodollar
Borrowing, the Interest Period to be applicable thereto after giving effect to
such election, which shall be a period contemplated by the definition of the
term "Interest Period".
If any such Interest Election Request requests a Eurodollar Borrowing but does
not specify an Interest Period, then the Borrower shall be deemed to have
selected an Interest Period of one month's duration.
(d) Promptly following receipt of an Interest Election
Request, the Administrative Agent shall advise each Lender of the details
thereof and of such Lender's portion of each resulting Borrowing.
(e) If the Borrower fails to deliver a timely Interest
Election Request with respect to a Eurodollar Borrowing prior to the end of the
Interest Period applicable thereto, then, unless such Borrowing is repaid as
provided herein, at the end of such Interest Period such Borrowing shall be
converted to an ABR Borrowing. Notwithstanding any contrary provision hereof, if
an Event of Default has occurred and is continuing and the Administrative Agent,
at the request of the Required Lenders, so notifies the Borrower, then, so long
as an Event of Default is continuing (i) no outstanding Borrowing may be
converted to or continued as a Eurodollar Borrowing and (ii) unless repaid, each
Eurodollar Borrowing shall be converted to an ABR Borrowing at the end of the
Interest Period applicable thereto.
SECTION 2.07. Termination and Reduction of Commitments. (a) Unless
previously terminated, the Commitments shall terminate on the Maturity Date.
(b) The Borrower may at any time terminate, or from time to
time reduce, the Commitments; provided that (i) each reduction of the
Commitments shall be in an amount that is an integral multiple of $1,000,000 and
not less than $5,000,000, (ii) any such reduction shall apply only to the
General Revolving Commitments until such time that the amount of the General
Revolving Commitments equals the amount of the Working Capital Revolving
Sub-Commitments and, thereafter, shall reduce both the General Revolving
Commitments and the Working Capital Revolving Sub-Commitments, and (iii) the
Borrower shall not terminate or reduce the Commitments if, after giving effect
to any concurrent prepayment of the Loans in accordance with Section 2.09, the
sum of the Revolving Credit Exposures would exceed the total Commitments.
(c) The Borrower shall notify the Administrative Agent of any
election to terminate or reduce the Commitments under paragraph (b) of this
Section at least three Business Days prior to the effective date of such
termination or reduction, specifying such election and the effective date
thereof. Promptly following receipt of any notice, the Administrative Agent
shall advise the Lenders of the contents thereof. Each notice delivered by the
Borrower pursuant to this Section shall be irrevocable; provided that a notice
of termination of the Commitments
26
delivered by the Borrower may state that such notice is conditioned upon the
effectiveness of other credit facilities, in which case such notice may be
revoked by the Borrower (by notice to the Administrative Agent on or prior to
the specified effective date) if such condition is not satisfied. Any
termination or reduction of the Commitments shall be permanent. Each reduction
of the Commitments shall be made ratably among the Lenders in accordance with
their respective Commitments.
SECTION 2.08. Repayment of Loans; Evidence of Debt. (a) The Borrower
hereby unconditionally promises to pay to the Administrative Agent for the
account of each Lender the then unpaid principal amount of each Loan on the
Maturity Date.
(b) 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 Loan made by such Lender, including the amounts
of principal and interest payable and paid to such Lender from time to time
hereunder.
(c) The Administrative Agent shall maintain accounts in which
it shall record (i) the amount of each Loan made hereunder, the Class and Type
thereof and the 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.
(d) The entries made in the accounts maintained pursuant to
paragraph (b) or (c) of this Section shall be prima facie evidence 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 Loans in accordance with the terms of this Agreement.
(e) Any Lender may request that Loans made by it be evidenced
by a promissory note. In such event, the Borrower shall prepare, execute and
deliver to such Lender a promissory note payable to the order of such Lender
(or, if requested by such Lender, to such Lender and its registered assigns) and
in a form approved by the Administrative Agent. Thereafter, the Loans evidenced
by such promissory note and interest thereon shall at all times (including after
an increase in such Lender's Commitment pursuant to Section 2.18 or an increase
or reduction in such Lender's Commitment pursuant to an assignment pursuant to
Section 9.04) be represented by one or more promissory notes in such form
payable to the order of the payee named therein (or, if such promissory note is
a registered note, to such payee and its registered assigns).
SECTION 2.09. Prepayment of Loans. (a) The Borrower shall have the
right at any time and from time to time to prepay any Borrowing in whole or in
part, subject to prior notice in accordance with paragraph (b) of this Section.
(b) The Borrower shall notify the Administrative Agent by
telephone (confirmed by telecopy) of any prepayment hereunder (i) in the case of
prepayment of a Eurodollar Borrowing, not later than 11:00 a.m., New York City
time, three Business Days
27
before the date of prepayment, or (ii) in the case of prepayment of an ABR
Borrowing, not later than 11:00 a.m., New York City time, one Business Day
before the date of prepayment. Each such notice shall be irrevocable and shall
specify the prepayment date and the principal amount of each Borrowing or
portion thereof to be prepaid; provided that, if a notice of prepayment is given
in connection with a conditional notice of termination of the Commitments as
contemplated by Section 2.07, then such notice of prepayment may be revoked if
such notice of termination is revoked in accordance with Section 2.07. Promptly
following receipt of any such notice relating to a Borrowing, the Administrative
Agent shall advise the Lenders of the contents thereof. Each partial prepayment
of any Borrowing shall be in an amount that would be permitted in the case of an
advance of a Borrowing of the same Type as provided in Section 2.02. Each
prepayment of a Borrowing shall be applied ratably to the Loans included in the
prepaid Borrowing. Prepayments shall be accompanied by accrued interest to the
extent required by Section 2.11 and any break funding payments required by
Section 2.14.
SECTION 2.10. Fees. (a) The Borrower agrees to pay the Administrative
Agent for the account of each Lender a facility fee which shall accrue at the
Applicable Rate on the daily amount of the Commitments of such Lender (whether
used or unused) during the period from and including the Restatement Effective
Date to but excluding the date on which such Commitment terminates; provided
that, if such Lender continues to have any Revolving Credit Exposure after its
Commitment terminates, then such facility fee shall continue to accrue on the
daily amount of such Lender's Revolving Credit Exposure from and including the
date on which its Commitment terminates to but excluding the date on which such
Lender ceases to have any Revolving Credit Exposure. Accrued facility fees shall
be payable in arrears on the last day of March, June, September and December of
each year and on the date on which the Commitments terminate, commencing on the
first such date to occur after the Original Agreement Date; provided that any
facility fees accruing after the date on which the Commitments terminate shall
be payable on demand. All facility fees shall be computed on the basis of a year
of 360 days and shall be payable for the actual number of days elapsed
(including the first day but excluding the last day).
(b) The Borrower agrees to pay (i) to the Administrative Agent
for the account of each Lender a participation fee with respect to its
participations in Letters of Credit, which shall accrue at the same Applicable
Rate as that applicable to Eurodollar loans on the average daily amount of such
Lender's LC Exposure (excluding any portion thereof attributable to unreimbursed
LC Disbursements) during the period from and including the Restatement Effective
Date to but excluding the later of the date on which such Lender's Commitment
terminates and the date on which such Lender ceases to have any LC Exposure, and
(ii) to the Issuing Bank a fronting fee, which shall accrue at the rate of
0.125% per annum on the average daily amount of the LC Exposure (excluding any
portion thereof attributable to unreimbursed LC Disbursements) during the period
from and including the Original Effective Date to but excluding the later of the
date of termination of the Commitments and the date on which there ceases to be
any LC Exposure, as well as the Issuing Bank's standard fees with respect to the
issuance, amendment, renewal or extension of any Letter of Credit or processing
of drawings thereunder. Participation fees and fronting fees accrued through and
including the last day of March, June, September and December of each year shall
be payable on the third Business Day following such last day, commencing on the
first such date to occur after the Original Effective Date; provided that all
such fees shall be payable on the date on which the Commitments
28
terminate and any such fees accruing after the date on which the Commitments
terminate shall be payable on demand. Any other fees payable to the Issuing Bank
pursuant to this paragraph shall be payable within 10 days after demand. All
participation fees and fronting fees shall be computed on the basis of a year of
360 days and shall be payable for the actual number of days elapsed (including
the first day but excluding the last day).
(c) The Borrower agrees to pay to the Administrative Agent,
for its own account, fees payable in the amounts and at the times separately
agreed upon between the Borrower and the Administrative Agent.
(d) All fees payable hereunder shall be paid on the dates due,
in immediately available funds, to the Administrative Agent (or to the Issuing
Bank, in the case of fees payable to it) for distribution, in the case of
facility fees and participation fees, to the Lenders. Fees paid shall not be
refundable under any circumstances.
SECTION 2.11. Interest. (a) The Loans comprising each ABR Borrowing
shall bear interest at the Alternate Base Rate plus the Applicable Rate.
(b) The Loans comprising each Eurodollar Borrowing shall bear
interest in the case of a Eurodollar Loan, at the Adjusted LIBO Rate for the
Interest Period in effect for such Borrowing plus the Applicable Rate.
(c) Notwithstanding the foregoing, if any principal of or
interest on any Loan or any fee or other amount payable by the Borrower
hereunder is not paid when due, whether at stated maturity, upon acceleration or
otherwise, such overdue amount shall bear interest, after as well as before
judgment, at a rate per annum equal to (i) in the case of overdue principal of
any Loan, 2% plus the rate otherwise applicable to such Loan as provided in the
preceding paragraphs of this Section or (ii) in the case of any other amount, 2%
plus the rate applicable to ABR Loans as provided in paragraph (a) of this
Section.
(d) Accrued interest on each Loan shall be payable in arrears
on each Interest Payment Date for such Loan and upon termination of the
Commitments; provided that (i) interest accrued pursuant to paragraph (c) of
this Section shall be payable on demand, (ii) in the event of any repayment or
prepayment of any Loan (other than a prepayment of an ABR Loan prior to the end
of the Availability Period), accrued interest on the principal amount repaid or
prepaid shall be payable on the date of such repayment or prepayment and (iii)
in the event of any conversion of any Eurodollar Loan prior to the end of the
current Interest Period therefor, accrued interest on such Loan shall be payable
on the effective date of such conversion.
(e) All interest hereunder shall be computed on the basis of a
year of 360 days, except that interest computed by reference to the Alternate
Base Rate at times when the Alternate Base Rate is based on the Prime Rate shall
be computed on the basis of a year of 365 days (or 366 days in a leap year), and
in each case shall be payable for the actual number of days elapsed (including
the first day but excluding the last day). The applicable Alternate Base Rate or
Adjusted LIBO Rate shall be determined by the Administrative Agent, and such
determination shall be conclusive absent manifest error.
29
SECTION 2.12. Alternate Rate of Interest. If prior to the commencement
of any Interest Period for a Eurodollar Borrowing:
(a) the Administrative Agent determines (which determination
shall be conclusive absent manifest error) that adequate and reasonable means do
not exist for ascertaining the Adjusted LIBO Rate for such Interest Period; or
(b) the Administrative Agent is advised by the Required
Lenders that the Adjusted LIBO Rate for such Interest Period will not adequately
and fairly reflect the cost to such Lenders (or Lender) of making or maintaining
their Loans (or its Loan) included in such Borrowing for such Interest Period;
then the Administrative Agent shall give notice thereof to the Borrower and the
Lenders by telephone or telecopy as promptly as practicable thereafter and,
until the Administrative Agent notifies the Borrower and the Lenders that the
circumstances giving rise to such notice no longer exist, (i) any Interest
Election Request that requests the conversion of any Borrowing to, or
continuation of any Borrowing as, a Eurodollar Borrowing shall be ineffective
and (ii) if any Borrowing Request requests a Eurodollar Borrowing, such
Borrowing shall be made as an ABR Borrowing.
SECTION 2.13. Increased Costs. (a) If any Change in Law shall:
(i) impose, modify or deem applicable any reserve,
special deposit or similar requirement against assets of, deposits with or for
the account of, or credit extended by, any Lender (except any such reserve
requirement reflected in the Adjusted LIBO Rate) or the Issuing Bank; or
(ii) impose on any Lender or the Issuing Bank or the
London interbank market any other condition affecting this Agreement or
Eurodollar Loans made by such Lender or any Letter of Credit or participation
therein;
and the result of any of the foregoing shall be to increase the cost to such
Lender of making or maintaining any Eurodollar Loan (or of maintaining its
obligation to make any such Loan) or to increase the cost to such Lender or the
Issuing Bank of participating in, issuing or maintaining any Letter of Credit or
to reduce the amount of any sum received or receivable by such Lender or the
Issuing Bank hereunder (whether of principal, interest or otherwise), then the
Borrower will pay to such Lender or the Issuing Bank, as the case may be, such
additional amount or amounts as will compensate such Lender or the Issuing Bank,
as the case may be, for such additional costs incurred or reduction suffered.
(b) If any Lender or the Issuing Bank determines that any
Change in Law regarding capital requirements has or would have the effect of
reducing the rate of return on such Lender's or the Issuing Bank's capital or on
the capital of such Lender's or the Issuing Bank's holding company, if any, as a
consequence of this Agreement or the Loans made by, or participations in Letters
of Credit held by, such Lender, or the Letters of Credit issued by the Issuing
Bank, to a level below that which such Lender or the Issuing Bank or such
Lender's or the Issuing Bank's holding company could have achieved but for such
Change in Law (taking into consideration such Lender's or the Issuing Bank's
policies and the policies of such Lender's
30
or the Issuing Bank's holding company with respect to capital adequacy), then
from time to time the Borrower will pay to such Lender or the Issuing Bank, as
the case may be, such additional amount or amounts as will compensate such
Lender or the Issuing Bank or such Lender's or the Issuing Bank's holding
company for any such reduction suffered.
(c) A certificate of a Lender or the Issuing Bank setting
forth the amount or amounts necessary to compensate such Lender or the Issuing
Bank or its holding company, as the case may be, as specified in paragraph (a)
or (b) of this Section shall be delivered to the Borrower and shall be
conclusive absent manifest error. The Borrower shall pay such Lender or the
Issuing Bank, as the case may be, the amount shown as due on any such
certificate within 10 days after receipt thereof.
(d) Failure or delay on the part of any Lender or the Issuing
Bank to demand compensation pursuant to this Section shall not constitute a
waiver of such Lender's or the Issuing Bank's right to demand such compensation;
provided that the Borrower shall not be required to compensate a Lender or the
Issuing Bank pursuant to this Section for any increased costs or reductions
incurred more than 270 days prior to the date that such Lender or the Issuing
Bank, as the case may be, notifies the Borrower of the Change in Law giving rise
to such increased costs or reductions and of such Lender's or the Issuing Bank's
intention to claim compensation therefor; provided further that, if the Change
in Law giving rise to such increased costs or reductions is retroactive, then
the 270-day period referred to above shall be extended to include the period of
retroactive effect thereof.
SECTION 2.14. Break Funding Payments. In the event of (a) the payment
of any principal of any Eurodollar Loan other than on the last day of an
Interest Period applicable thereto (including as a result of an Event of
Default), (b) the conversion of any Eurodollar Loan other than on the last day
of the Interest Period applicable thereto, (c) the failure to borrow, convert,
continue or prepay any Loan on the date specified in any notice delivered
pursuant hereto (regardless of whether such notice may be revoked under Section
2.09(b) and is revoked in accordance therewith), or (d) the assignment of any
Eurodollar Loan other than on the last day of the Interest Period applicable
thereto as a result of a request by the Borrower pursuant to Section 2.17, then,
in any such event, the Borrower shall compensate each Lender for the loss, cost
and expense attributable to such event. In the case of a Eurodollar Loan, such
loss, cost or expense to any Lender shall be deemed to include an amount
determined by such Lender to be the excess, if any, of (i) the amount of
interest which would have accrued on the principal amount of such Loan had such
event not occurred, at the Adjusted LIBO Rate (in the case of a Eurodollar Loan)
that would have been applicable to such Loan, for the period from the date of
such event to the last day of the then current Interest Period therefor (or, in
the case of a failure to borrow, convert or continue, for the period that would
have been the Interest Period for such Loan), over (ii) the amount of interest
which would accrue on such principal amount for such period at the interest rate
which such Lender would bid were it to bid, at the commencement of such period,
for dollar deposits of a comparable amount and period from other banks in the
Eurodollar market. A certificate of any Lender setting forth any amount or
amounts that such Lender is entitled to receive pursuant to this Section shall
be delivered to the Borrower and shall be conclusive absent manifest error. The
Borrower shall pay such Lender the amount shown as due on any such certificate
within 10 days after receipt thereof.
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SECTION 2.15. Taxes. (a) Any and all payments by or on account of any
obligation of the Borrower hereunder shall be made free and clear of and without
deduction for any Indemnified Taxes or Other Taxes; provided that if the
Borrower shall be required to deduct any Indemnified Taxes or Other Taxes from
such payments, then (i) the sum payable shall be increased as necessary so that
after making all required deductions (including deductions applicable to
additional sums payable under this Section) the Administrative Agent, Lender or
Issuing Bank (as the case may be) receives an amount equal to the sum it would
have received had no such deductions been made, (ii) the Borrower shall make
such deductions and (iii) the Borrower shall pay the full amount deducted to the
relevant Governmental Authority in accordance with applicable law.
(b) In addition, the Borrower shall pay any Other Taxes to the
relevant Governmental Authority in accordance with applicable law.
(c) The Borrower shall indemnify the Administrative Agent,
each Lender and the Issuing Bank, within 10 days after written demand therefor,
for the full amount of any Indemnified Taxes or Other Taxes paid by the
Administrative Agent, such Lender or the Issuing Bank, as the case may be, on or
with respect to any payment by or on account of any obligation of the Borrower
hereunder (including Indemnified Taxes or Other Taxes imposed or asserted on or
attributable to amounts payable under this Section) and any penalties, interest
and reasonable expenses arising therefrom or with respect thereto, whether or
not such Indemnified Taxes or Other Taxes were correctly or legally imposed or
asserted by the relevant Governmental Authority. A certificate as to the amount
of such payment or liability delivered to the Borrower by a Lender or the
Issuing Bank, or by the Administrative Agent on its own behalf or on behalf of a
Lender or the Issuing Bank, shall be conclusive absent manifest error.
(d) As soon as practicable after any payment of Indemnified
Taxes or Other Taxes by the Borrower to a Governmental Authority, the Borrower
shall deliver to the Administrative Agent the original or a certified copy of a
receipt issued by such Governmental Authority evidencing such payment, a copy of
the return reporting such payment or other evidence of such payment reasonably
satisfactory to the Administrative Agent.
(e) Any Foreign Lender that is entitled to an exemption from
or reduction of withholding tax under the law of the jurisdiction in which the
Borrower is located, or any treaty to which such jurisdiction is a party, with
respect to payments under this Agreement shall deliver to the Borrower (with a
copy to the Administrative Agent), at the time or times prescribed by applicable
law, such properly completed and executed documentation prescribed by applicable
law or reasonably requested by the Borrower as will permit such payments to be
made without withholding or at a reduced rate.
SECTION 2.16. Payments Generally; Pro Rata Treatment; Sharing of
Set-offs. (a) The Borrower shall make each payment required to be made by it
hereunder (whether of principal, interest, fees or reimbursement of LC
Disbursements, or of amounts payable under Section 2.13, 2.14 or 2.15, or
otherwise) prior to 12:00 noon, New York City time, on the date when due, in
immediately available funds, without set-off or counterclaim. Any amounts
received after such time on any date may, in the discretion of the
Administrative Agent, be deemed to have been received on the next succeeding
Business Day for purposes of calculating interest thereon. All
32
such payments shall be made to the Administrative Agent at its offices at 270
Park Avenue, New York, New York, except payments to be made directly to the
Issuing Bank as expressly provided herein and except that payments pursuant to
Sections 2.13, 2.14, 2.15 and 9.03 shall be made directly to the Persons
entitled thereto. The Administrative Agent shall distribute any such payments
received by it for the account of any other Person to the appropriate recipient
promptly following receipt thereof. If any payment hereunder shall be due on a
day that is not a Business Day, the date for payment shall be extended to the
next succeeding Business Day, and, in the case of any payment accruing interest,
interest thereon shall be payable for the period of such extension. All payments
hereunder shall be made in dollars.
(b) If at any time insufficient funds are received by and
available to the Administrative Agent to pay fully all amounts of principal,
unreimbursed LC Disbursements, interest and fees then due hereunder, such funds
shall be applied (i) first, towards payment of interest and fees then due
hereunder, ratably among the parties entitled thereto in accordance with the
amounts of interest and fees then due to such parties, and (ii) second, towards
payment of principal and unreimbursed LC Disbursements then due hereunder,
ratably among the parties entitled thereto in accordance with the amounts of
principal and unreimbursed LC Disbursements then due to such parties.
(c) If any Lender shall, by exercising any right of set-off or
counterclaim or otherwise, obtain payment in respect of any principal of or
interest on any of its Loans or participations in LC Disbursements resulting in
such Lender receiving payment of a greater proportion of the aggregate amount of
its Loans and participations in LC Disbursements and accrued interest thereon
than the proportion received by any other Lender, then the Lender receiving such
greater proportion shall purchase (for cash at face value) participations in the
Loans and participations in LC Disbursements of other Lenders to the extent
necessary so that the benefit of all such payments shall be shared by the
Lenders ratably in accordance with the aggregate amount of principal of and
accrued interest on their respective Loans and participations in LC
Disbursements; provided that (i) if any such participations are purchased and
all or any portion of the payment giving rise thereto is recovered, such
participations shall be rescinded and the purchase price restored to the extent
of such recovery, without interest, and (ii) the provisions of this paragraph
shall not be construed to apply to any payment made by the Borrower pursuant to
and in accordance with the express terms of this Agreement or any payment
obtained by a Lender as consideration for the assignment of or sale of a
participation in any of its Loans or participations in LC Disbursements to any
assignee or participant, other than to the Borrower or any Subsidiary or
Affiliate thereof (as to which the provisions of this paragraph shall apply).
The Borrower consents to the foregoing and agrees, to the extent it may
effectively do so under applicable law, that any Lender acquiring a
participation pursuant to the foregoing arrangements may exercise against the
Borrower rights of set-off and counterclaim with respect to such participation
as fully as if such Lender were a direct creditor of the Borrower in the amount
of such participation.
(d) Unless the Administrative Agent shall have received notice
from the Borrower prior to the date on which any payment is due to the
Administrative Agent for the account of the Lenders or the Issuing Bank
hereunder that the Borrower will not make such payment, the Administrative Agent
may assume that the Borrower has made such payment on such date in accordance
herewith and may, in reliance upon such assumption, distribute to the
33
Lenders or the Issuing Bank, as the case may be, the amount due. In such event,
if the Borrower has not in fact made such payment, then each of the Lenders or
the Issuing Bank, as the case may be, severally agrees to repay to the
Administrative Agent forthwith on demand the amount so distributed to such
Lender or Issuing Bank with interest thereon, for each day from and including
the date such amount is distributed to it to but excluding the date of payment
to the Administrative Agent, at the greater of the Federal Funds Effective Rate
and a rate determined by the Administrative Agent in accordance with banking
industry rules on interbank compensation.
(e) If any Lender shall fail to make any payment required to
be made by it pursuant to Sections 2.04(d) or (e), 2.05(b) or 2.16(d), then the
Administrative Agent may, in its discretion (notwithstanding any contrary
provision hereof), apply any amounts thereafter received by the Administrative
Agent for the account of such Lender to satisfy such Lender's obligations under
such Sections until all such unsatisfied obligations are fully paid.
SECTION 2.17. Mitigation Obligations; Replacement of Lenders. (a) If
any Lender requests compensation under Section 2.13, or if the Borrower is
required to pay any additional amount to any Lender or any Governmental
Authority for the account of any Lender pursuant to Section 2.15, then such
Lender shall use reasonable efforts to designate a different lending office for
funding or booking its Loans hereunder or to assign its rights and obligations
hereunder to another of its offices, branches or affiliates, if, in the judgment
of such Lender, such designation or assignment (i) would eliminate or reduce
amounts payable pursuant to Section 2.13 or 2.15, as the case may be, in the
future and (ii) would not subject such Lender to any unreimbursed cost or
expense and would not otherwise be disadvantageous to such Lender. The Borrower
hereby agrees to pay all reasonable costs and expenses incurred by any Lender in
connection with any such designation or assignment.
(b) If any Lender requests compensation under Section 2.13, or
if the Borrower is required to pay any additional amount to any Lender or any
Governmental Authority for the account of any Lender pursuant to Section 2.15,
or if any Lender defaults in its obligation to fund Loans 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 9.04), all its interests, rights and obligations under this Agreement 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 (and,
if a Commitment is being assigned, the Issuing Bank), which consent shall not
unreasonably be withheld, (ii) such Lender shall have received payment of an
amount equal to the outstanding principal of its Loans and participations in LC
Disbursements, accrued interest thereon, accrued fees and all other amounts
payable to it hereunder, 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 Section 2.13 or payments required to be made
pursuant to Section 2.15, 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.
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SECTION 2.18. Procedures Regarding Increases to the Commitments. (a) So
long as no Default or Event of Default has occurred and is continuing, the
Borrower may request from time to time, subject to the terms and conditions
hereinafter set forth, that the aggregate amount of the Lenders' Commitments be
increased. Any such request shall be made by written notice to the
Administrative Agent; provided, however, that any such notice must be given no
later than 60 days prior to the Maturity Date. Each such notice (a "Initial
Notice of Commitment Increase") shall be in the form of Exhibit D-1 and specify
therein:
(i) the proposed effective date of such increase,
which date (the requested "Commitment Increase Effective Date") shall be no
earlier than forty-five days after receipt by the Administrative Agent of such
notice; and
(ii) the amount of the requested increase; provided,
however, that (A) such increase must be at least $10,000,000, (B) after giving
effect to such requested increase, the aggregate amount of the Lenders'
Commitments shall not exceed $225,000,000, (C) such increase shall be applied in
full to the General Revolving Commitments, and (D) the aggregate amount of the
Working Capital Revolving Sub-Commitments, which are a subset of the General
Revolving Commitments, shall not change (notwithstanding that the Working
Capital Revolving Sub-Commitment of a given Lender may change pursuant to the
last sentence of the definition of "Working Capital Revolving Sub-Commitment"
herein).
The Administrative Agent shall deliver a copy of such Initial Notice of
Commitment Increase to each Lender via facsimile transmission on or before the
third Business Day next succeeding the date the Administrative Agent receives
such Initial Notice of Commitment Increase. After receipt of the Initial Notice
of Commitment Increase, each Lender shall determine, in its sole discretion,
whether to participate, and to what extent, if any, in such Commitment increase
and shall communicate such decision in writing to the Administrative Agent and
the Borrower on or before the eleventh day prior to the proposed Commitment
Increase Effective Date.
(b) On the tenth day prior to the proposed Commitment Increase
Effective Date, so long as no Default or Event of Default has occurred and is
continuing, the Borrower shall deliver to the Administrative Agent a written
notice confirming the requested increase in the aggregate amount of the Lenders'
Commitments. Each such notice (a "Notice of Confirmation of Commitment
Increase") shall be in the form of Exhibit D-2 and specify therein:
(i) the proposed Commitment Increase Effective Date,
which date shall be no earlier than five Business Days after receipt by the
Administrative Agent of such Notice of Confirmation of Commitment Increase;
(ii) the amount of the requested increase; provided,
however, that (A) such increase must be at least $10,000,000, (B) after giving
effect to such requested increase, the aggregate amount of the Lenders'
Commitments shall not exceed $225,000,000, (C) such increase shall be applied in
full to the General Revolving Commitments, and (D) the aggregate amount of the
Working Capital Revolving Sub-Commitments, which are a subset of the General
Revolving Commitments, shall not change (notwithstanding that the Working
Capital Revolving Sub-Commitment of a given Lender may change pursuant to the
last sentence of the definition of "Working Capital Revolving Sub-Commitment"
herein);
35
(iii) the identity of each of the then Lenders, if
any, which has agreed with the Borrower to increase its Commitment in an amount
such that its Applicable Percentage after giving effect to such requested
increase will be the same or greater than its Applicable Percentage prior to
giving effect to such requested increase (each such Lender being an "Increasing
Lender"), each of the other then Lenders, if any, which has agreed to increase
its Commitment in an amount such that its Applicable Percentage after giving
effect to such a requested increase will be less than its Applicable Percentage
prior to giving effect to such requested increase (each such Lender being a
"Partially Increasing Lender") and the identity of each financial institution
not already a Lender, if any, which has agreed with the Borrower to become a
Lender to effect such requested increase in the aggregate amount of the Lenders'
Commitments (each such financial institution shall be reasonably acceptable to
the Administrative Agent and each such financial institution being a "New
Lender" and each of the other then Lenders, if any, which has not agreed to
increase its Commitment being a "Reducing Lender"); and
(iv) the amount of the respective Commitments of the
then existing Lenders, such Increasing Lenders, such Partially Increasing
Lenders, such Reducing Lenders and such New Lenders from and after the effective
date of such increase.
(c) On or before each Commitment Increase Effective Date:
(i) the Borrower, each Increasing Lender, each
Partially Increasing Lender and each then New Lender shall execute and deliver
to the Administrative Agent for its acceptance, as to form, documentation
embodying the provisions of the Notice of Commitment Increase relating to the
increase in the aggregate amount of the Lenders' Commitments to be effected on
such Commitment Increase Effective Date; and
(ii) upon acceptance of such documentation by the
Administrative Agent, which acceptance shall not be unreasonably withheld, and
so long as no Default or Event of Default has occurred and is continuing, (A)
the Administrative Agent shall give prompt notice of such acceptance to each
Lender, (B) it shall become effective, and each Increasing Lender's and
Partially Increasing Lender's Commitment shall be increased to the amount
specified therein, on such Commitment Increase Effective Date and (C) the
Administrative Agent shall record each New Lender's information in the Register.
(d) On each Commitment Increase Effective Date:
(i) each then New Lender and each then Increasing
Lender shall, by wire transfer of immediately available funds, deliver to the
Administrative Agent such Lenders' New Funds Amount for such Commitment Increase
Effective Date, which amount, for each such Lender, shall constitute Loans made
by such Lender to the Borrower pursuant to Section 2.01 on such Commitment
Increase Effective Date; and
(ii) the Administrative Agent shall, by wire transfer
of immediately available funds, pay to each then Reducing Lender and to each
Partially Increasing Lender its Reduction Amount for such Commitment Increase
Effective Date, which amount, for each such Lender, shall constitute a
prepayment by the Borrower pursuant to Section 2.09, ratably in
36
accordance with the respective principal amounts thereof, of the principal
amounts of all then outstanding Loans of such Lender.
The Administrative Agent shall record each then New Lender's, each then
Increasing Lender's and each then Partially Increasing Lender's information in
the Register. Also effective as of each Commitment Increase Effective Date, each
then New Lender and each then Increasing Lender shall be deemed to have
purchased and had transferred to it, and each then Reducing Lender and each
Partially Increasing Lender shall be deemed to have sold and transferred as
provided in Section 2.04(d) to such New Lenders and Increasing Lenders, such
undivided interest and participation in such Reducing Lender's and such
Partially Increasing Lender's interest and participation in all then outstanding
Letters of Credit, to the extent necessary so that such undivided interests and
participations of all Lenders (including each New Lender) shall accord with
their respective Applicable Percentages after giving effect to the increase in
the aggregate amount of the Lenders' Commitments on such Commitment Increase
Effective Date.
ARTICLE III
Representations and Warranties
The Borrower represents and warrants to the Lenders that:
SECTION 3.01. Organization; Powers. Each of the Borrower and its
Subsidiaries is duly organized, validly existing and in good standing under the
laws of the jurisdiction of its organization, has all requisite power and
authority to carry on its business as now conducted and, except where the
failure to do so, individually or in the aggregate, could not reasonably be
expected to result in a Material Adverse Effect, is qualified to do business in,
and is in good standing in, every jurisdiction where such qualification is
required.
SECTION 3.02. Authorization; Enforceability. The Transactions are
within the Borrower's partnership powers and have been duly authorized by all
necessary corporate, limited liability company or partnership and, if required,
stockholder, member or limited partner action. This Agreement has been duly
executed and delivered by the Borrower and constitutes a legal, valid and
binding obligation of the Borrower, enforceable in accordance with its terms,
subject to applicable bankruptcy, insolvency, reorganization, moratorium or
other laws affecting creditors' rights generally and subject to general
principles of equity, regardless of whether considered in a proceeding in equity
or at law.
SECTION 3.03. Governmental Approvals; No Conflicts. The Transactions
(a) do not require any consent or approval of, registration or filing with, or
any other action by, any Governmental Authority, except such as have been
obtained or made and are in full force and effect, (b) will not violate any
applicable law or regulation or the charter, by-laws or other organizational
documents of the Borrower or any of its Subsidiaries or any order of any
Governmental Authority, (c) will not violate or result in a default under any
indenture, agreement or other instrument binding upon the Borrower or any of its
Subsidiaries or its assets, or give rise to a right thereunder to require any
payment to be made by the Borrower or any of its Subsidiaries, and (d) will not
result in the creation or imposition of any Lien on any asset of the Borrower or
any of its Subsidiaries.
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SECTION 3.04. Financial Condition; No Material Adverse Change. (a) The
Borrower has heretofore furnished to the Lenders its consolidated balance sheet
and statements of income, partners equity and cash flows (i) as of and for the
fiscal year ended December 31, 2001, reported on by independent public
accountants, and (ii) as of and for the fiscal quarter and the portion of the
fiscal year ended September 30, 2002, certified by its chief financial officer.
Such financial statements present fairly, in all material respects, the
financial position and results of operations and cash flows of the Borrower and
its consolidated Subsidiaries as of such dates and for such periods in
accordance with GAAP, subject to year-end audit adjustments and the absence of
footnotes in the case of the statements referred to in clause (ii) above.
(b) Since December 31, 2001, there has been no material
adverse change in the business, assets, operations, prospects or condition,
financial or otherwise, of the Borrower and its Subsidiaries, taken as a whole.
SECTION 3.05. Properties. (a) Each of the Borrower and its Subsidiaries
has good title to, or valid leasehold interests in, all its real and personal
property material to its business, free and clear of all Liens except Permitted
Encumbrances and Liens otherwise permitted or contemplated by this Agreement.
(b) Each of the Borrower and its Subsidiaries owns, or is
licensed to use, or has made all required federal filings (and has not been
notified of any contest) with respect to, all trademarks, tradenames,
copyrights, patents and other intellectual property material to its business,
and the use thereof by the Borrower and its Subsidiaries does not infringe upon
the rights of any other Person, except for any such infringements that,
individually or in the aggregate, could not reasonably be expected to result in
a Material Adverse Effect.
SECTION 3.06. Litigation and Environmental Matters. (a) There are no
actions, suits or proceedings by or before any arbitrator or Governmental
Authority pending against or, to the knowledge of the Borrower, threatened
against or affecting the Borrower or any of its Subsidiaries (i) as to which
there is a reasonable possibility of an adverse determination and that, if
adversely determined, could reasonably be expected, individually or in the
aggregate, to result in a Material Adverse Effect (other than the Disclosed
Matters) or (ii) that involve this Agreement or the Transactions.
(b) Except for the Disclosed Matters and except with respect
to any other matters that, individually or in the aggregate, could not
reasonably be expected to result in a Material Adverse Effect, neither the
Borrower nor any of its Subsidiaries (i) has failed to comply with any
Environmental Law or to obtain, maintain or comply with any permit, license or
other approval required under any Environmental Law, (ii) has become subject to
any Environmental Liability, (iii) has received notice of any claim with respect
to any Environmental Liability or (iv) knows of any basis for any Environmental
Liability.
(c) Since the Restatement Effective Date, there has been no
change in the status of the Disclosed Matters that, individually or in the
aggregate, has resulted in, or materially increased the likelihood of, a
Material Adverse Effect.
38
SECTION 3.07. Compliance with Laws and Agreements. Each of the Borrower
and its Subsidiaries is in compliance with all laws, regulations and orders of
any Governmental Authority applicable to it or its property and all indentures,
agreements and other instruments binding upon it or its property, except where
the failure to do so, individually or in the aggregate, could not reasonably be
expected to result in a Material Adverse Effect. No Default has occurred and is
continuing.
SECTION 3.08. Investment and Holding Company Status. Neither the
Borrower nor any of its Subsidiaries is (a) an "investment company" as defined
in, or subject to regulation under, the Investment Company Act of 1940 or (b) a
"holding company" as defined in, or subject to regulation under, the Public
Utility Holding Company Act of 1935. The Borrower is not subject to regulation
under any Federal or State statute or regulation which limits its ability to
incur Indebtedness.
SECTION 3.09. Taxes. Each of the Borrower and its Subsidiaries has
timely filed or caused to be filed all Tax returns and reports required to have
been filed and has paid or caused to be paid all Taxes required to have been
paid by it, except (a) Taxes that are being contested in good faith by
appropriate proceedings and for which the Borrower or such Subsidiary, as
applicable, has set aside on its books adequate reserves or (b) to the extent
that the failure to do so could not reasonably be expected to result in a
Material Adverse Effect.
SECTION 3.10. ERISA. Each ERISA Affiliate has fulfilled its obligations
under the minimum funding standards of ERISA and the Code with respect to each
Plan and is in compliance in all material respects with the presently applicable
provisions of ERISA and the Code with respect to each Plan. No ERISA Affiliate
has (i) sought a waiver of the minimum funding standard under Section 412 of the
Code in respect of any Plan, (ii) failed to make any contribution or payment to
any Plan or Multiemployer Plan or in respect of any Benefit Arrangement or made
any amendment to any Plan or Benefit Arrangement, which has resulted or could
reasonably be expected to result in the imposition of a Lien or the posting of a
bond or other security under ERISA or the Code or (iii) incurred any liability
under Title IV of ERISA other than a liability to the PBGC for premiums under
Section 4007 of ERISA.
SECTION 3.11. Disclosure. The Borrower has disclosed to the Lenders all
agreements, instruments and corporate or other restrictions to which it or any
of its Subsidiaries is subject, and all other matters known to it, that,
individually or in the aggregate, could reasonably be expected to result in a
Material Adverse Effect. Neither the Information Memorandum nor any of the other
reports, financial statements, certificates or other information furnished by or
on behalf of the Borrower to the Administrative Agent or any Lender in
connection with the negotiation of this Agreement or delivered hereunder (as
modified or supplemented by other information so furnished) contains any
material misstatement of fact or omits to state any material fact necessary to
make the statements therein, in the light of the circumstances under which they
were made, not misleading; provided that, with respect to projected financial
information, the Borrower represents only that such information was prepared in
good faith based upon assumptions believed to be reasonable at the time.
SECTION 3.12. Investments and Guarantees. As of the Restatement
Effective Date, neither the Borrower nor any Subsidiary has any Investments or
has outstanding any Guarantees,
39
except as permitted by this Agreement or reflected in the financial statements
described in Section 3.04(a).
SECTION 3.13. Subsidiaries. As of the Restatement Effective Date, the
Borrower has no Subsidiaries.
SECTION 3.14. Casualties; Taking of Property. Neither the business nor
the assets of the Borrower or any Subsidiary have been materially and adversely
affected as a result of any fire, explosion, earthquake, flood, drought,
windstorm, accident, strike or other labor disturbance, embargo, requisition or
taking of any assets or cancellation of contracts, permits or concessions by any
domestic or foreign government or any agency thereof, riot, activities of armed
forces or acts of God or of any public enemy.
ARTICLE IV
Conditions
SECTION 4.01. Conditions to Restatement. The closing and effectiveness
of this Agreement is subject to the satisfaction, immediately prior to or
concurrently with such closing on the Restatement Effective Date, of the
following conditions precedent:
(a) The Administrative Agent (or its counsel) shall have
received (i) this Agreement, executed and delivered by a duly authorized officer
of the Borrower, by the Required Lenders under the Original Agreement, by each
Lender with a greater Commitment under this Agreement than under the Original
Agreement, and by each Lender on the Restatement Effective Date not a party to
the Original Agreement, and (ii) the MLP Guaranty, executed and delivered by a
duly authorized officer of the MLP and satisfactory in form and substance to the
Administrative Agent.
(b) The Administrative Agent shall have received a favorable
written opinion (addressed to the Administrative Agent and the Lenders and dated
the Restatement Effective Date) of (i) Andrews & Kurth L.L.P., counsel for the
Borrower and the MLP and (ii) Bradley C. Barron, in-house counsel of Valero,
collectively providing the opinions set forth in Exhibit B, and each such
opinion covering such other matters relating to the Borrower, the General
Partner, the MLP, this Agreement or the Transactions as the Lenders shall
reasonably request. The Borrower hereby requests each such counsel to deliver
its applicable opinion to the Administrative Agent and the Lenders.
(c) The Administrative Agent shall have received such
documents and certificates as the Administrative Agent or its counsel may
reasonably request relating to the organization, existence and good standing of
the Borrower, the General Partner, the MLP, the authorization of the
Transactions, and any other legal matters relating to the Borrower, the General
Partner, the MLP, the Agreement or the Transactions, all in form and substance
satisfactory to the Administrative Agent and its counsel.
(d) The Administrative Agent shall have received a
certificate, dated the Restatement Effective Date and signed by the President,
Vice President or a Financial Officer of the Borrower, confirming compliance
with the conditions set forth in paragraphs (a) and (b) of Section 4.02.
40
(e) The Administrative Agent shall have received (i)
counterpart originals of the Partnership Agreement (MLP) substantially in the
form filed as Exhibit 3.4 to the MLP's annual report on Form 10-K for the fiscal
year ended December 31, 2001, as amended by the First Amendment (filed as
Exhibit 3.5 to the 10-K) and the Reorganization Agreement, dated as of May 30,
2002, filed as Exhibit 99.1 to the MLP's current report on Form 8-K on June 6,
2002, the Omnibus Agreement, the Transportation Agreement, the Indenture and the
Partnership Agreement (Borrower) in form and substance acceptable to the
Lenders, in each case duly executed by each of the parties thereto and (ii)
evidence satisfactory to the Lenders that the Partnership Agreement (Borrower),
the Omnibus Agreement, the Transportation Agreement, the Indenture and the
Partnership Agreement (MLP) are in full force and effect and have not been
amended or modified except to the extent such amendments or modifications have
been delivered to the Administrative Agent, which evidence may be in the form of
a certificate of the President or a Vice President (or equivalent officer) of
the Borrower.
(f) The Administrative Agent shall have received all fees and
other amounts due and payable on or prior to the Restatement Effective Date
(including all fees due and payable on or prior to such time pursuant to Section
2.10 of the Original Agreement), including, to the extent invoiced,
reimbursement or payment of all out-of-pocket expenses required to be reimbursed
or paid by the Borrower hereunder.
(g) The Administrative Agent shall have received satisfactory
evidence regarding the scope and materiality of any environmental risks
affecting the properties of the Borrower and its subsidiaries.
The Administrative Agent shall notify the Borrower and the Lenders of the
Restatement Effective Date, and such notice shall be conclusive and binding.
Notwithstanding the foregoing, the obligations of the Lenders to make Loans and
of the Issuing Bank to issue Letters of Credit under this Agreement shall not
become effective unless each of the foregoing conditions is satisfied (or waived
pursuant to Section 9.02) at or prior to 3:00 p.m., New York City time, on March
6, 2003.
SECTION 4.02. Each Credit Event. The obligation of each Lender to make
a Loan on the occasion of any Borrowing, and of the Issuing Bank to issue,
amend, renew or extend any Letter of Credit, is subject to the satisfaction of
the following conditions:
(a) The representations and warranties of the Borrower set
forth in this Agreement shall be true and correct on and as of the date of such
Borrowing or the date of issuance, amendment, renewal or extension of such
Letter of Credit, as applicable (unless such representations and warranties are
stated to relate to a specific earlier date, in which case such representations
and warranties shall be true and correct as of such earlier date).
(b) At the time of and immediately after giving effect to such
Borrowing or the issuance, amendment, renewal or extension of such Letter of
Credit, as applicable, no Default shall have occurred and be continuing.
(c) The Administrative Agent shall have received each
additional document, instrument, legal opinion or item of information reasonably
requested by the Administrative
41
Agent, including, without limitation, a copy of any debt instrument, security
agreement or other material contract to which the Borrower or any Subsidiary may
be a party.
Each Borrowing and each issuance, amendment, renewal or extension of a Letter of
Credit shall be deemed to constitute a representation and warranty by the
Borrower on the date thereof as to the matters specified in paragraphs (a) and
(b) of this Section 4.02.
ARTICLE V
Affirmative Covenants
Until the Commitments have expired or been terminated and the principal
of and interest on each Loan and all fees payable hereunder shall have been paid
in full and all Letters of Credit shall have expired or terminated and all LC
Disbursements shall have been reimbursed, the Borrower covenants and agrees with
the Lenders that:
SECTION 5.01. Financial Statements and Other Information. The Borrower
will furnish to the Administrative Agent and each Lender:
(a) within 105 days after the end of each fiscal year of the
MLP:
(i) the audited consolidated balance sheet and related
statements of income, partners equity and cash flows of the MLP as of
the end of and for such year, setting forth in each case in comparative
form the figures for the previous fiscal year, all reported on by Ernst
& Young LLP or other independent public accountants of recognized
national standing (without a "going concern" or like qualification or
exception and without any qualification or exception as to the scope of
such audit) to the effect that such consolidated financial statements
present fairly in all material respects the financial condition,
results of operations and cash flows of the MLP and its consolidated
Subsidiaries on a consolidated basis in accordance with GAAP
consistently applied;
(ii) the consolidating balance sheet and related statements of
income, partners equity and cash flows of the MLP as of the end of and
for such year, setting forth in each case in comparative form the
figures from the previous fiscal year, all certified by one of the
Borrower's Financial Officers as presenting fairly in all material
respects the financial condition and results of operations of the
Borrower in accordance with GAAP consistently applied, subject to the
absence of footnotes; and
(iii) the consolidated balance sheet and related statements of
income, partners equity and cash flows of the Borrower as of the end of
and for such year, setting forth in each case in comparative form the
figures from the previous fiscal year, all certified by one of its
Financial Officers as presenting fairly in all material respects the
financial condition and results of operations of the Borrower and its
consolidated Subsidiaries on a consolidated basis in accordance with
GAAP consistently applied, subject to the absence of footnotes.
42
(b) within 60 days after the end of each of the first three
fiscal quarters of each fiscal year of the Borrower, its consolidated balance
sheet and related statements of income, partners equity and cash flows as of the
end of and for such fiscal quarter and the then elapsed portion of the fiscal
year, setting forth in each case in comparative form the figures for the
corresponding period or periods of (or, in the case of the balance sheet, as of
the end of) the previous fiscal year, all certified by one of its Financial
Officers as presenting fairly in all material respects the financial condition
and results of operations of the Borrower and its consolidated Subsidiaries on a
consolidated basis in accordance with GAAP consistently applied, subject to
normal year-end audit adjustments and the absence of footnotes;
(c) concurrently with any delivery of financial statements
under clause (a) or (b) above, a certificate of a Financial Officer of the
Borrower (i) certifying as to whether a Default has occurred and, if a Default
has occurred, specifying the details thereof and any action taken or proposed to
be taken with respect thereto, (ii) setting forth reasonably detailed
calculations demonstrating compliance with Section 6.11 and (iii) stating
whether any change in GAAP or in the application thereof has occurred since the
date of the audited financial statements referred to in Section 3.04 and, if any
such change has occurred, specifying the effect of such change on the financial
statements accompanying such certificate;
(d) promptly and in any event within ten (10) Business Days
after the existence of any of the following conditions, a certificate of the
President or a Vice President (or equivalent officer) of the Borrower, or of the
officer of the Borrower primarily responsible for monitoring compliance by the
Borrower and its Subsidiaries with Environmental Laws, specifying in detail the
nature of such condition and the Borrower's proposed response thereto, in each
case if the occurrence of such event could reasonably be expected to have a
Material Adverse Effect:
(i) the receipt by the Borrower or the General
Partner of any communication (written or oral), whether from a Governmental
Authority or other Person that alleges that the Borrower or any Subsidiary is
not in compliance with applicable Environmental Laws or Environmental Approvals,
(ii) the President or a Vice President (or equivalent
officer) of the Borrower, or the officer of the Borrower primarily responsible
for monitoring compliance by the Borrower and its Subsidiaries with
Environmental Laws, shall obtain actual knowledge that there exists any
Environmental Liability pending or threatened against the Borrower or any
Subsidiary, or
(iii) any release, emission, discharge or disposal of
any Hazardous Materials that could reasonably be expected to form the basis of
any Environmental Liability with respect to the Borrower or any Subsidiary.
The Borrower will also maintain and make available for inspection by the
Administrative Agent and the Lenders and their agents and employees accurate and
complete records of all investigations, studies, sampling and testing conducted,
and any and all remedial actions taken, by the Borrower, any Subsidiary or, to
its knowledge and to the extent obtained by the Borrower
43
and the General Partner, by any Governmental Authority or other Person in
respect to Hazardous Materials on or affecting the properties of Borrower and
its Subsidiaries.
(e) Prior to the end of each fiscal year, a copy of the
projections of the operating budget and cash flows for the next succeeding
fiscal year, such projections to be accompanied by a certificate of a Financial
Officer to the effect that the projections have been prepared on the basis of
sound financial planning practice and that such Financial Officer has no reason
to believe that such projections are incorrect or misleading in any material
respect; and
(f) promptly following any request therefor, such other
information regarding the operations, business affairs and financial condition
of the Borrower or any Subsidiary, or compliance with the terms of this
Agreement, as the Administrative Agent or any Lender may reasonably request.
SECTION 5.02. Notices of Material Events. The Borrower will furnish to
the Administrative Agent and each Lender prompt written notice of the following:
(a) the occurrence of any Default;
(b) the filing or commencement of any action, suit or
proceeding by or before any arbitrator or Governmental Authority against or
affecting the Borrower or any Affiliate thereof that, if adversely determined,
could reasonably be expected to result in a Material Adverse Effect;
(c) if and when any ERISA Affiliate (i) gives or is required
to give notice to the PBGC of any "reportable event" (as defined in Section 4043
of ERISA) with respect to any Plan which could reasonably be expected to
constitute grounds for a termination of such Plan under Title IV of ERISA, or
knows that the plan administrator of any Plan has given or is required to give
notice of any such reportable event, a copy of the notice of such reportable
event given or required to be given to the PBGC; (ii) receives notice of
complete or partial withdrawal liability under Title IV of ERISA or notice that
any Multiemployer Plan is in reorganization, is insolvent or has been
terminated, a copy of such notice; (iii) receives notice from the PBGC under
Title IV of ERISA of an intent to terminate, impose liability (other than for
premiums under Section 4007 of ERISA) in respect of, or appoint a trustee to
administer any Plan, a copy of such notice; (iv) applies for a waiver of the
minimum funding standard under Section 412 of the Code, a copy of such
application; (v) gives notice of intent to terminate any Plan under Section
4041(c) of ERISA, a copy of such notice and other information filed with the
PBGC; (vi) gives notice of withdrawal from any Plan pursuant to Section 4063 of
ERISA, a copy of such notice; or (vii) fails to make any payment or contribution
to any Plan or Multi-Employer Plan or in respect of any Benefit Arrangement or
makes any amendment to any Plan or Benefit Arrangement which has resulted or
could reasonably be expected to result in the imposition of a Lien or the
posting of a bond or other security, a certificate of a Financial Officer of the
Borrower setting forth details as to such occurrence and action, if any, which
the Borrower or applicable ERISA Affiliate is required or proposes to take.
(d) any other development that results in, or could reasonably
be expected to result in, a Material Adverse Effect; and
44
(e) any material amendment to the Partnership Agreement (MLP),
the Partnership Agreement (Borrower) or any Material Agreement, together with a
certified copy of such amendment.
Each notice delivered under this Section shall be accompanied by a statement of
a Financial Officer or President or any Vice President (or equivalent officer)
of the Borrower setting forth the details of the event or development requiring
such notice and any action taken or proposed to be taken with respect thereto.
SECTION 5.03. Existence; Conduct of Business. The Borrower will, and
will cause each of its Subsidiaries to, do or cause to be done all things
necessary to preserve, renew and keep in full force and effect its legal
existence and the rights, licenses, permits, privileges and franchises material
to the conduct of its business; provided that the foregoing shall not prohibit
any merger, consolidation, liquidation or dissolution permitted under Section
6.03.
SECTION 5.04. Payment of Obligations. The Borrower will, and will cause
each of its Subsidiaries to, pay its obligations, including Tax liabilities,
that, if not paid, could result in a Material Adverse Effect before the same
shall become delinquent or in default, except where (a) the validity or amount
thereof is being contested in good faith by appropriate proceedings, (b) the
Borrower or such Subsidiary has set aside on its books adequate reserves with
respect thereto in accordance with GAAP and (c) the failure to make payment
pending such contest could not reasonably be expected to result in a Material
Adverse Effect.
SECTION 5.05. Maintenance of Properties; Insurance. The Borrower will,
and will cause each of its Subsidiaries to, (a) keep and maintain all property
material to the conduct of its business in good working order and condition,
ordinary wear and tear excepted, and (b) maintain, with financially sound and
reputable insurance companies, insurance in such amounts and against such risks
as are customarily maintained by companies engaged in the same or similar
businesses operating in the same or similar locations.
SECTION 5.06. Books and Records; Inspection Rights. The Borrower will,
and will cause each of its Subsidiaries to, keep proper books of record and
account in which full, true and correct entries are made of all dealings and
transactions in relation to its business and activities. The Borrower will, and
will cause each of its Subsidiaries to, permit any representatives designated by
the Administrative Agent or any Lender, upon reasonable prior notice, to visit
and inspect its properties, to examine and make extracts from its books and
records, and to discuss its affairs, finances and condition with its officers
and independent accountants, all at such reasonable times and as often as
reasonably requested.
SECTION 5.07. Compliance with Laws. The Borrower will, and will cause
each of its Subsidiaries to, comply with all laws, rules, regulations and orders
of any Governmental Authority applicable to it or its property and the terms and
provisions of the Material Agreements, except where the failure to do so,
individually or in the aggregate, could not reasonably be expected to result in
a Material Adverse Effect.
SECTION 5.08. Use of Proceeds and Letters of Credit. The proceeds of
the Working Capital Revolving Loans will be used to finance the working capital
requirements of the
45
Borrower and its Subsidiaries, or to pay, in whole or in part, Restricted
Payments permitted pursuant to the terms hereof. The proceeds of the General
Revolving Loans that are not Working Capital Revolving Loans will be used to
finance the working capital requirements and general partnership purposes of the
Borrower and its Subsidiaries, but will not be used to make any Restricted
Payment permitted by Section 6.06(b) (except in connection with the Valero Asset
Transaction). The Letters of Credit shall be used for general business purposes
in the ordinary course of business or for such other purposes as may be approved
by the Administrative Agent. No part of the proceeds of any Loan will be used,
whether directly or indirectly, for any purpose that entails a violation of any
of the Regulations of the Board, including Regulations T, U and X.
SECTION 5.09. Environmental Laws. The Borrower will, and will cause
each of its Subsidiaries to:
(a) comply with, and ensure compliance by all tenants and
subtenants, if any, with, all applicable Environmental Laws and obtain and
comply with and maintain, and ensure that all tenants and subtenants obtain and
comply with and maintain, any and all licenses, approvals, notifications,
registrations or permits required by applicable Environmental Laws except to the
extent that failure to do so could not reasonably be expected to have a Material
Adverse Effect; and
(b) conduct and complete all investigations, studies, sampling
and testing, and all remedial, removal and other actions required under
Environmental Laws and promptly comply with all lawful orders and directives of
all Governmental Authorities regarding Environmental Laws except to the extent
that the same are being contested in good faith by appropriate proceedings and
the pendency of such proceedings could not reasonably be expected to have a
Material Adverse Effect.
SECTION 5.10. Clean-Down. The Borrower will cause the aggregate
outstanding principal balance of the Working Capital Revolving Loans, the
proceeds of which were used to pay Restricted Payments, to be zero for a period
of at least 15 consecutive days during each calendar year.
SECTION 5.11. Subsidiaries. The Borrower will, substantially
contemporaneously with its formation or acquisition, cause each Subsidiary
(other than Non-U.S. Subsidiaries) to become a Guarantor with respect to, and
jointly and severally liable with all other Guarantors for, all obligations of
the Borrower under this Agreement by executing and delivering to the
Administrative Agent, for the benefit of the Lenders, a Subsidiary Guaranty,
substantially in the form of Exhibit C-2. The Borrower shall, or shall cause
such Subsidiary to, further deliver any and all instruments, documents,
approvals, consents or opinions of counsel reasonably requested by the
Administrative Agent or the Required Lenders in connection with any such
Subsidiary Guaranty.
ARTICLE VI
Negative Covenants
Until the Commitments have expired or terminated and the principal of
and interest on each Loan and all fees payable hereunder have been paid in full
and all Letters of Credit have
46
expired or terminated and all LC Disbursements shall have been reimbursed, the
Borrower covenants and agrees with the Lenders that:
SECTION 6.01. Indebtedness. The Borrower will not, and will not permit
any Subsidiary to, create, incur, assume or permit to exist any Indebtedness,
except:
(a) Indebtedness created under this Agreement;
(b) Indebtedness of the Borrower to any Subsidiary and of any
Subsidiary to the Borrower or any other Subsidiary;
(c) Guarantees by the Borrower of Indebtedness of any
Subsidiary and by any Subsidiary of Indebtedness of the Borrower or any other
Subsidiary;
(d) other Indebtedness of the Borrower and any Subsidiary;
provided that, both before and after such Indebtedness is created, incurred or
assumed, no Default shall exist under this Agreement, including, without
limitation, a Default with respect to (i) the Consolidated Interest Coverage
Ratio set forth in Section 6.11(a) and (ii) the Consolidated Debt Coverage Ratio
set forth in Section 6.11(b).
SECTION 6.02. Liens. The Borrower will not, and will not permit any
Subsidiary to, create, incur, assume or permit to exist any Lien on any property
or asset now owned or hereafter acquired by it, or assign or sell any income or
revenues (including accounts receivable) or rights in respect of any thereof,
except:
(a) Permitted Encumbrances;
(b) any Lien existing on any property or asset prior to the
acquisition thereof by the Borrower or any Subsidiary or existing on any
property or asset of any Person that becomes a Subsidiary after the date hereof
prior to the time such Person becomes a Subsidiary; provided that (i) such Lien
is not created in contemplation of or in connection with such acquisition or
such Person becoming a Subsidiary, as the case may be, (ii) such Lien shall not
apply to any other property or assets of the Borrower or any Subsidiary and
(iii) such Lien shall secure only those obligations which it secures on the date
of such acquisition or the date such Person becomes a Subsidiary, as the case
may be;
(c) Liens on fixed or capital assets acquired, constructed or
improved by the Borrower or any Subsidiary; provided that (i) such security
interest secures Indebtedness permitted by clause (d) of Section 6.01, (ii) such
security interests and the Indebtedness secured thereby are incurred prior to or
within 90 days after such acquisition or the completion of such construction or
improvement, (iii) the Indebtedness secured thereby does not exceed the cost of
acquiring, constructing or improving such fixed or capital assets and (iv) such
security interests shall not apply to any other property or assets of the
Borrower or any Subsidiary; and
(d) other Liens securing Indebtedness in an amount that does
not at any time exceed 10% of Consolidated Tangible Net Worth.
47
SECTION 6.03. Fundamental Changes. (a) The Borrower will not, and will
not permit any Subsidiary to, merge into or consolidate with any other Person,
or permit any other Person to merge into or consolidate with it, or sell,
transfer, lease or otherwise dispose of (in one transaction or in a series of
transactions) all or any substantial part of its assets, or all or substantially
all of the stock of any of its Subsidiaries (in each case whether now owned or
hereafter acquired), or liquidate or dissolve, except that, if at the time
thereof and immediately after giving effect thereto no Default shall have
occurred and be continuing (i) any Subsidiary may merge into the Borrower in a
transaction in which the Borrower is the surviving corporation or the Borrower
may merge with another Person so long as (A) the surviving entity or purchaser,
if other than the Borrower, assumes, pursuant to the terms of such transaction,
each of the obligations of the Borrower hereunder and under any other documents
entered into in connection with the Loans and (B) each such assumption is
expressly evidenced by an agreement executed and delivered to the Lenders in a
form reasonably satisfactory to the Administrative Agent, (ii) any Subsidiary
may merge into any Subsidiary in a transaction in which the surviving entity is
a Subsidiary, and (iii) any Subsidiary may liquidate or dissolve if the Borrower
determines in good faith that such liquidation or dissolution is in the best
interests of the Borrower and is not materially disadvantageous to the Lenders;
provided that any such merger involving a Person that is not a Wholly-Owned
Subsidiary immediately prior to such merger shall not be permitted unless also
permitted by Section 6.04.
(a) The Borrower will not, and will not permit any of its
Subsidiaries to, engage to any material extent in any business other than
businesses of the type conducted by the Borrower and its Subsidiaries on the
Original Agreement Date and businesses reasonably related thereto.
SECTION 6.04. Investments, Loans, Advances, Guarantees and
Acquisitions. The Borrower will not, and will not permit any of its Subsidiaries
to, purchase, hold or acquire (including pursuant to any merger with any Person
that was not a Wholly-Owned Subsidiary prior to such merger) any Investment in
or Guarantee any obligations of, any other Person, or purchase or otherwise
acquire (in one transaction or a series of transactions) any assets of any other
Person constituting a business unit, except:
(a) Permitted Investments;
(b) Investments by the Borrower in the Equity Interest of its
Subsidiaries, so long as each such Subsidiary has Guaranteed the Indebtedness of
the Borrower under this Agreement;
(c) loans or advances made by the Borrower to any Subsidiary
and made by any Subsidiary to the Borrower or any other Subsidiary, so long as
each such Subsidiary has Guaranteed the Indebtedness of the Borrower under this
Agreement;
(d) Guarantees constituting Indebtedness permitted by Section
6.01;
(e) the Borrower's interest in the Skelly-Belvieu Pipeline
Company, L.L.C.;
(f) Investments in Joint Venture Interests and the purchase or
other acquisition of the assets of another Person constituting a business unit;
provided, that, both
48
before and after giving effect to any such Investment, no Default shall exist,
including, without limitation, a Default with respect to (i) use of proceeds set
forth in Section 5.08, (ii) the Consolidated Interest Coverage Ratio set forth
in Section 6.11(a), or (iii) the Consolidated Debt Coverage Ratio set forth in
Section 6.11(b);
(g) Investments in Non-U.S. Subsidiaries; provided, however,
that, the aggregate amount of such Investments shall not exceed $15,000,000 at
any time; and
(h) Investments described in the definition of (and only if
made in connection with) the Valero Asset Transaction.
SECTION 6.05. Hedging Agreements. The Borrower will not, and will not
permit any of its Subsidiaries to, enter into any Hedging Agreement, other than
Hedging Agreements entered into in the ordinary course of business to hedge or
mitigate risks to which the Borrower or any Subsidiary is exposed in the conduct
of its business or the management of its liabilities.
SECTION 6.06. Restricted Payments. The Borrower will not, and will not
permit any of its Subsidiaries to, declare or make, or agree to pay or make,
directly or indirectly, any Restricted Payment, except (a) any Subsidiary may
declare and pay Restricted Payments to the Borrower and (b) as long as no
Default has occurred and is continuing or would result therefrom, the Borrower
may make Restricted Payments consisting of cash distributions in accordance with
the terms of the Partnership Agreement (Borrower); provided, however, that, for
the avoidance of doubt, the Lenders and the Borrower agree that the Borrower may
make the Restricted Payments described in the definition of (and in connection
with the) "Valero Asset Transaction" herein, provided that the making of such
Restricted Payments is not prohibited by the Partnership Agreement (Borrower).
SECTION 6.07. Transactions with Affiliates. The Borrower will not, and
will not permit any of its Subsidiaries to, sell, lease or otherwise transfer
any property or assets to, or purchase, lease or otherwise acquire any property
or assets from, or otherwise engage in any other transactions with, any of its
Affiliates, except (a) in the ordinary course of business at prices and on terms
and conditions not less favorable to the Borrower or such Subsidiary than could
be obtained on an arm's-length basis from unrelated third parties, (b)
transactions between or among the Borrower and its Wholly-Owned Subsidiaries not
involving any other Affiliate, (c) any Restricted Payment permitted by Section
6.06, (d) pursuant to the agreements listed on Schedule 6.07, which agreements
are at prices and on terms and conditions not less favorable to the Borrower
than could be obtained on an arm's-length basis from unrelated third parties,
and (e) the Valero Asset Transaction.
SECTION 6.08. Restrictive Agreements. The Borrower will not, and will
not permit any of its Subsidiaries to, directly or indirectly, enter into, incur
or permit to exist any agreement or other arrangement that prohibits, restricts
or imposes any condition upon (a) the ability of the Borrower or any Subsidiary
to create, incur or permit to exist any Lien upon any of its property or assets,
or (b) the ability of any Subsidiary to pay dividends or other distributions
with respect to any shares of its capital stock or to make or repay loans or
advances to the Borrower or any other Subsidiary or to Guarantee Indebtedness of
the Borrower or any other Subsidiary; provided that (i) the foregoing shall not
apply to restrictions and conditions imposed by law or by this
49
Agreement, (ii) the foregoing shall not apply to restrictions and conditions (x)
existing on the Restatement Agreement Date identified on Schedule 6.08 (but
shall apply to any extension or renewal of, or any amendment or modification
expanding the scope of, any such restriction or condition so as to cause such
restriction or condition to be more restrictive than the restriction or
condition in existence on the Restatement Agreement Date) or (y) arising or
agreed to after the Restatement Agreement Date; provided that such restrictions
or conditions are not more restrictive than the restrictions and conditions
existing on the Restatement Agreement Date, (iii) the foregoing shall not apply
to customary restrictions and conditions contained in agreements relating to the
sale of a Subsidiary pending such sale, provided such restrictions and
conditions apply only to the Subsidiary that is to be sold and such sale is
permitted hereunder, (iv) clause (a) of the foregoing shall not apply to
restrictions or conditions imposed by any agreement relating to secured
Indebtedness permitted by this Agreement if such restrictions or conditions
apply only to the property or assets securing such Indebtedness and (v) clause
(a) of the foregoing shall not apply to customary provisions in leases and other
contracts restricting the assignment thereof.
SECTION 6.09. Limitation on Modifications of Other Agreements. The
Borrower will not, and will not permit any Subsidiary to, amend, modify or
change, or consent to any amendment, modification or change to, any of the terms
of, the Material Agreements, except to the extent the same could not reasonably
be expected to have a Material Adverse Effect.
SECTION 6.10. Creation of Subsidiaries. The Borrower will not at any
time create or acquire any Subsidiary unless Borrower has caused such Subsidiary
to comply with the requirements of Section 5.11.
SECTION 6.11. Financial Condition Covenants. The Borrower will not
permit at any time (a) its Consolidated Interest Coverage Ratio to be less than
3.50 to 1.00 or (b) its Consolidated Debt Coverage Ratio to be in excess of 4.00
to 1.00.
ARTICLE VII
Events of Default
If any of the following events ("Events of Default") shall occur:
(a) the Borrower shall fail to pay any principal of any Loan
or any reimbursement obligation in respect of any LC Disbursement when and as
the same shall become due and payable, whether at the due date thereof or at a
date fixed for prepayment thereof or otherwise;
(b) the Borrower shall fail to pay any interest on any Loan or
any fee or any other amount (other than an amount referred to in clause (a) of
this Article) payable under this Agreement, when and as the same shall become
due and payable, and such failure shall continue unremedied for a period of five
Business Days;
(c) any representation or warranty made or deemed made by or
on behalf of the Borrower or any Subsidiary in or in connection with any Loan
Document or any amendment or modification thereof or waiver thereunder, or in
any report, certificate, financial statement or other document furnished
pursuant to or in connection with the Loan Documents or any
50
amendment or modification hereof or waiver hereunder, shall prove to have been
incorrect when made or deemed made;
(d) the Borrower shall fail to observe or perform any
covenant, condition or agreement contained in Section 5.02, 5.03 (with respect
to the Borrower's existence), 5.08 or 5.10 or in Article VI;
(e) the Borrower shall fail to observe or perform any
covenant, condition or agreement contained in the Loan Documents (other than
those specified in clause (a), (b) or (d) of this Article), and such failure
shall continue unremedied for a period of 30 days after notice thereof from the
Administrative Agent to the Borrower (which notice will be given at the request
of any Lender);
(f) the Borrower or any Subsidiary shall fail to make any
payment (whether of principal or interest and regardless of amount) in respect
of any Material Indebtedness, when and as the same shall become due and payable;
(g) a default shall occur in the payment when due (subject to
any applicable grace period), whether by acceleration or otherwise, of any
Material Indebtedness; or a default shall occur in the performance or observance
of any obligation or condition with respect to any Material Indebtedness if the
effect of such default is to accelerate the maturity of any such Indebtedness or
such default shall continue unremedied for any applicable period of time
sufficient to permit the holder or holders of such Indebtedness, or any trustee
or agent for such holders, to cause such Indebtedness to become due and payable
prior to its expressed maturity.
(h) an involuntary proceeding shall be commenced or an
involuntary petition shall be filed seeking (i) liquidation, reorganization or
other relief in respect of the General Partner, the Borrower or any Subsidiary
or its debts, or of a substantial part of its assets, under any Federal, state
or foreign bankruptcy, insolvency, receivership or similar law now or hereafter
in effect or (ii) the appointment of a receiver, trustee, custodian,
sequestrator, conservator or similar official for the General Partner, the
Borrower or any Subsidiary or for a substantial part of its assets, and, in any
such case, such proceeding or petition shall continue undismissed for 60 days or
an order or decree approving or ordering any of the foregoing shall be entered;
(i) the General Partner, the Borrower or any Subsidiary shall
(i) voluntarily commence any proceeding or file any petition seeking
liquidation, reorganization or other relief under any Federal, state or foreign
bankruptcy, insolvency, receivership or similar law now or hereafter in effect,
(ii) consent to the institution of, or fail to contest in a timely and
appropriate manner, any proceeding or petition described in clause (h) of this
Article, (iii) apply for or consent to the appointment of a receiver, trustee,
custodian, sequestrator, conservator or similar official for the General
Partner, the Borrower or any Subsidiary or for a substantial part of its assets,
(iv) file an answer admitting the material allegations of a petition filed
against it in any such proceeding, (v) make a general assignment for the benefit
of creditors or (vi) take any action for the purpose of effecting any of the
foregoing;
(j) the General Partner, the Borrower or any Subsidiary shall
become unable, admit in writing its inability or fail generally to pay its debts
as they become due;
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(k) one or more judgments for the payment of money in an
aggregate amount in excess of $10,000,000 and that are not covered by insurance
shall be rendered against the Borrower, any Subsidiary or any combination
thereof and the same shall remain undischarged for a period of 30 consecutive
days during which execution shall not be effectively stayed, or any action shall
be legally taken by a judgment creditor to attach or levy upon any assets of the
Borrower or any Subsidiary to enforce any such judgment;
(l) an ERISA Event shall have occurred that, in the opinion of
the Required Lenders, when taken together with all other ERISA Events that have
occurred, could reasonably be expected to result in liability of the Borrower
and its Subsidiaries in an aggregate amount exceeding $10,000,000;
(m) the Borrower or any Subsidiary shall incur an
Environmental Liability requiring payment in any Rolling Period in excess of
$10,000,000;
(n) the MLP shall (i) conduct, transact or otherwise engage
in, or commit to conduct, transact or otherwise engage in, any business or
operations other than (X) those incidental to its ownership of the limited
partner interests in the Borrower or of Equity Interests in other Wholly-Owned
Subsidiaries and (Y) the incurrence and maintenance of Indebtedness or (ii) own,
lease, manage or otherwise operate any properties or assets (including cash and
cash equivalents), other than (A) the limited partner interests in the Borrower,
(B) ownership interests (not to exceed 1% in each such case) of a Subsidiary,
(C) ownership interests in other subsidiaries not Subsidiaries of the Borrower,
(D) cash received in connection with dividends made by the Borrower in
accordance with Section 6.06(b) pending application to the holders of the Units
and the General Partner Interest, (E) cash received in connection with the
incurrence of Indebtedness and (F) cash received in connection with dividends
made by other subsidiaries;
(o) a Change in Control shall occur; or
(p) the sale by Valero of a material portion of its Refinery
Assets unless each purchaser thereof has (i) a debt rating of its senior,
unsecured, long-term indebtedness for borrowed money that is not guaranteed by
any other Person or subject to any other credit enhancement of at least
BBB-/Baa3 and (ii) and has fully assumed, with respect to such purchased
Refinery Assets, the rights and obligations of Valero and its Affiliates under
the Transportation Agreement.
then, and in every such event (other than an event with respect to the Borrower
described in clause (h) or (i) of this Article), and at any time thereafter
during the continuance of such event, the Administrative Agent may, and at the
request of the Required Lenders shall, by notice to the Borrower, take either or
both of the following actions, at the same or different times:(i) terminate the
Commitments, and thereupon the Commitments shall terminate immediately, and (ii)
declare the Loans then outstanding to be due and payable in whole (or in part,
in which case any principal not so declared to be due and payable may thereafter
be declared to be due and payable), and thereupon the principal of the Loans so
declared to be due and payable, together with accrued interest thereon and all
fees and other obligations of the Borrower accrued hereunder, shall become due
and payable immediately, without presentment, demand, protest or other notice of
any kind, all of which are hereby waived by the Borrower; and in case of any
52
event with respect to the Borrower described in clause (h) or (i) of this
Article, the Commitments shall automatically terminate and the principal of the
Loans then outstanding, together with accrued interest thereon and all fees and
other obligations of the Borrower accrued hereunder, shall automatically become
due and payable, without presentment, demand, protest or other notice of any
kind, all of which are hereby waived by the Borrower.
ARTICLE VIII
The Administrative Agent
Each of the Lenders and the Issuing Bank hereby irrevocably appoints
the Administrative Agent as its agent and authorizes the Administrative Agent to
take such actions on its behalf and to exercise such powers as are delegated to
the Administrative Agent by the terms hereof, together with such actions and
powers as are reasonably incidental thereto.
The bank serving as the Administrative Agent hereunder shall have the
same rights and powers in its capacity as a Lender as any other Lender and may
exercise the same as though it were not the Administrative Agent, and such bank
and its Affiliates may accept deposits from, lend money to and generally engage
in any kind of business with the Borrower or any Subsidiary or other Affiliate
thereof as if it were not the Administrative Agent hereunder.
The Administrative Agent shall not have any duties or obligations
except those expressly set forth herein. Without limiting the generality of the
foregoing, (a) the Administrative Agent shall not be subject to any fiduciary or
other implied duties, regardless of whether a Default has occurred and is
continuing, (b) the Administrative Agent shall not have any duty to take any
discretionary action or exercise any discretionary powers, except discretionary
rights and powers expressly contemplated hereby that the Administrative Agent is
required to exercise in writing by the Required Lenders (or such other number or
percentage of the Lenders as shall be necessary under the circumstances as
provided in Section 9.02), and (c) except as expressly set forth herein, the
Administrative Agent shall not have any duty to disclose, and shall not be
liable for the failure to disclose, any information relating to the Borrower or
any of its Subsidiaries that is communicated to or obtained by the bank serving
as Administrative Agent or any of its Affiliates in any capacity. The
Administrative Agent shall not be liable for any action taken or not taken by it
with the consent or at the request of the Required Lenders (or such other number
or percentage of the Lenders as shall be necessary under the circumstances as
provided in Section 9.02) or in the absence of its own gross negligence or
wilful misconduct. The Administrative Agent shall be deemed not to have
knowledge of any Default unless and until written notice thereof is given to the
Administrative Agent by the Borrower or a Lender, and the Administrative Agent
shall not be responsible for or have any duty to ascertain or inquire into (i)
any statement, warranty or representation made in or in connection with this
Agreement, (ii) the contents of any certificate, report or other document
delivered hereunder or in connection herewith, (iii) the performance or
observance of any of the covenants, agreements or other terms or conditions set
forth herein, (iv) the validity, enforceability, effectiveness or genuineness of
this Agreement or any other agreement, instrument or document, or (v) the
satisfaction of any condition set forth in Article IV or elsewhere herein, other
than to confirm receipt of items expressly required to be delivered to the
Administrative Agent.
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The Administrative Agent shall be entitled to rely upon, and shall not
incur any liability for relying upon, any notice, request, certificate, consent,
statement, instrument, document or other writing believed by it to be genuine
and to have been signed or sent by the proper Person. The Administrative Agent
also may rely upon any statement made to it orally or by telephone and believed
by it to be made by the proper Person, and shall not incur any liability for
relying thereon. The Administrative Agent may consult with legal counsel (who
may be counsel for the Borrower), independent accountants and other experts
selected by it, and shall not be liable for any action taken or not taken by it
in accordance with the advice of any such counsel, accountants or experts.
The Administrative Agent may perform any and all its duties and
exercise its rights and powers by or through any one or more sub-agents
appointed by the Administrative Agent. The Administrative Agent and any such
sub-agent may perform any and all its duties and exercise its rights and powers
through their respective Related Parties. The exculpatory provisions of the
preceding paragraphs shall apply to any such sub-agent and to the Related
Parties of the Administrative Agent and any such sub-agent, and shall apply to
their respective activities in connection with the syndication of the credit
facilities provided for herein as well as activities as Administrative Agent.
Subject to the appointment and acceptance of a successor Administrative
Agent as provided in this paragraph, the Administrative Agent may resign at any
time by notifying the Lenders, the Issuing Bank and the Borrower. Upon any such
resignation, the Required Lenders shall have the right, in consultation with the
Borrower, to appoint a successor. If no successor shall have been so appointed
by the Required Lenders and shall have accepted such appointment within 30 days
after the retiring Administrative Agent gives notice of its resignation, then
the retiring Administrative Agent may, on behalf of the Lenders and the Issuing
Bank, appoint a successor Administrative Agent which shall be a Lender and a
commercial bank with an office in New York, New York and having a combined
capital and surplus of at least $500,000,000, or an Affiliate of any such bank.
Upon the acceptance of its appointment as Administrative Agent hereunder by a
successor, such successor shall 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 hereunder. The fees payable by the Borrower to a successor
Administrative Agent shall be the same as those payable to its predecessor
unless otherwise agreed between the Borrower and such successor. After the
Administrative Agent's resignation hereunder, the provisions of this Article and
Section 9.03 shall continue in effect for the benefit of such retiring
Administrative Agent, its sub-agents and their respective Related Parties in
respect of any actions taken or omitted to be taken by any of them while it was
acting as Administrative Agent.
Each Lender acknowledges that it has, independently and without
reliance upon the Administrative Agent or any other Lender and based on such
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 from time to time deem appropriate, continue to make its
own decisions in taking or not taking action under or based upon this Agreement,
any related agreement or any document furnished hereunder or thereunder.
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ARTICLE IX
Miscellaneous
SECTION 9.01. Notices. Except in the case of notices and other
communications expressly permitted to be given by telephone, all notices and
other communications provided for herein shall be in writing and shall be
delivered by hand or overnight courier service, mailed by certified or
registered mail or sent by telecopy, as follows:
(a) if to the Borrower, to it at One Valero Place, San
Antonio, Texas 78212, Attention of Senior Vice President and Chief Financial
Officer (Telecopy No. (210) 592-2010);
(b) if to the Administrative Agent, to JPMorgan Chase Bank,
Loan and Agency Services Group, 1111 Fannin, 8th Floor, Houston, TX 77002,
Attention of Maria Arreola (Telecopy No. (713) 750-2228);
(c) if to the Issuing Bank, to it at JPMorgan Chase Bank,
Letter of Credit Group, Global Trade Services, 10420 Highland Manor Dr., Tampa,
FL 33610, Attention of James Alonzo (Telecopy No. (813) 432-5161);
(d) if to any other Lender, to it at its address (or telecopy
number) set forth in its Administrative Questionnaire.
Any party hereto may change its address or telecopy number for notices and other
communications hereunder by notice to the other parties hereto. All notices and
other communications given to any party hereto in accordance with the provisions
of this Agreement shall be deemed to have been given on the date of receipt.
SECTION 9.02. Waivers; Amendments. (a) No failure or delay by the
Administrative Agent, the Issuing Bank or any Lender in exercising any right or
power hereunder shall operate as a waiver thereof, nor shall any single or
partial exercise of any such right or power, or any abandonment or
discontinuance of steps to enforce such a right or power, preclude any other or
further exercise thereof or the exercise of any other right or power. The rights
and remedies of the Administrative Agent, the Issuing Bank and the Lenders
hereunder are cumulative and are not exclusive of any rights or remedies that
they would otherwise have. No waiver of any provision of this Agreement or
consent to any departure by the Borrower therefrom shall in any event be
effective unless the same shall be permitted by paragraph (b) of this Section,
and then such waiver or consent shall be effective only in the specific instance
and for the purpose for which given. Without limiting the generality of the
foregoing, the making of a Loan or issuance of a Letter of Credit shall not be
construed as a waiver of any Default, regardless of whether the Administrative
Agent, any Lender or the Issuing Bank may have had notice or knowledge of such
Default at the time.
(b) Neither this Agreement nor any provision hereof may be
waived, amended or modified except pursuant to an agreement or agreements in
writing entered into by the Borrower and the Required Lenders or by the Borrower
and the Administrative Agent with the consent of the Required Lenders; provided
that no such agreement shall (i) increase the Commitment of any Lender without
the written consent of such Lender, (ii) reduce the principal amount of any Loan
or LC Disbursement or reduce the rate of interest thereon, or reduce any
55
fees payable hereunder, without the written consent of each Lender affected
thereby, (iii) postpone the scheduled date of payment of the principal amount of
any Loan or LC Disbursement, or any interest thereon, or any fees payable
hereunder, or reduce the amount of, waive or excuse any such payment, or
postpone the scheduled date of expiration of any Commitment, without the written
consent of each Lender affected thereby, (iv) change Section 2.16(b) or (c) in a
manner that would alter the pro rata sharing of payments required thereby,
without the written consent of each Lender, or (v) change any of the provisions
of this Section or the definition of "Required Lenders" or any other provision
hereof specifying the number or percentage of Lenders required to waive, amend
or modify any rights hereunder or make any determination or grant any consent
hereunder, without the written consent of each Lender; provided further that no
such agreement shall amend, modify or otherwise affect the rights or duties of
the Administrative Agent or the Issuing Bank hereunder without the prior written
consent of the Administrative Agent or the Issuing Bank, as the case may be.
SECTION 9.03. Expenses; Indemnity; Damage Waiver. (a) The Borrower
shall pay (i) all reasonable out-of-pocket expenses incurred by the
Administrative Agent and its Affiliates, including the reasonable fees, charges
and disbursements of counsel for the Administrative Agent, in connection with
the syndication of the credit facilities provided for herein, the preparation
and administration of this Agreement or any amendments, modifications or waivers
of the provisions hereof (whether or not the transactions contemplated hereby or
thereby shall be consummated), (ii) all reasonable out-of-pocket expenses
incurred by the Issuing Bank in connection with the issuance, amendment, renewal
or extension of any Letter of Credit or any demand for payment thereunder and
(iii) all out-of-pocket expenses incurred by the Administrative Agent, the
Issuing Bank or any Lender, including the fees, charges and disbursements of any
counsel for the Administrative Agent, the Issuing Bank or any Lender, in
connection with the enforcement or protection of its rights in connection with
this Agreement, including its rights under this Section, or in connection with
the Loans made or Letters of Credit issued hereunder, including all such
out-of-pocket expenses incurred during any workout, restructuring or
negotiations in respect of such Loans or Letters of Credit.
(a) The Borrower shall indemnify the Administrative Agent, the
Issuing Bank and each Lender, and each Related Party of any of the foregoing
Persons (each such Person being called an "Indemnitee") against, and hold each
Indemnitee harmless from, any and all losses, claims, damages, liabilities and
related expenses, including the fees, charges and disbursements of any counsel
for any Indemnitee, incurred by or asserted against any Indemnitee arising out
of, in connection with, or as a result of (i) the execution or delivery of this
Agreement or any agreement or instrument contemplated hereby (including the MLP
Guaranty), the performance by the parties hereto of their respective obligations
hereunder or the consummation of the Transactions or any other transactions
contemplated hereby, (ii) any Loan or Letter of Credit or the use of the
proceeds therefrom (including any refusal by the Issuing Bank to honor a demand
for payment under a Letter of Credit if the documents presented in connection
with such demand do not strictly comply with the terms of such Letter of
Credit), (iii) any actual or alleged presence or release of Hazardous Materials
on or from any property owned or operated by the Borrower or any of its
Subsidiaries, or any Environmental Liability related in any way to the Borrower
or any of its Subsidiaries, or (iv) any actual or prospective claim, litigation,
investigation or proceeding relating to any of the foregoing, whether based on
contract, tort or any other theory and regardless of whether any Indemnitee is a
party thereto; provided that such
56
indemnity shall not, as to any Indemnitee, be available to the extent that such
losses, claims, damages, liabilities or related expenses are determined by a
court of competent jurisdiction by final and nonappealable judgment to have
resulted from the gross negligence or wilful misconduct of such Indemnitee.
(c) To the extent that the Borrower fails to pay any amount
required to be paid by it to the Administrative Agent or the Issuing Bank under
paragraph (a) or (b) of this Section, each Lender severally agrees to pay to the
Administrative Agent or the Issuing Bank, as the case may be, such Lender's
Applicable Percentage (determined as of the time that the applicable
unreimbursed expense or indemnity payment is sought) of such unpaid amount;
provided that the unreimbursed expense or indemnified loss, claim, damage,
liability or related expense, as the case may be, was incurred by or asserted
against the Administrative Agent or the Issuing Bank in its capacity as such.
(d) To the extent permitted by applicable law, the Borrower
shall not assert, and hereby waives, any claim against any Indemnitee, on any
theory of liability, for special, indirect, consequential or punitive damages
(as opposed to direct or actual damages) arising out of, in connection with, or
as a result of, this Agreement or any agreement or instrument contemplated
hereby, the Transactions, any Loan or Letter of Credit or the use of the
proceeds thereof.
(e) All amounts due under this Section shall be payable not
later than 5 Business Days after written demand therefor.
SECTION 9.04. Successors and Assigns. (a) The provisions of this
Agreement shall be binding upon and inure to the benefit of the parties hereto
and their respective successors and assigns permitted hereby (including any
Affiliate of the Issuing Bank that issues any Letter of Credit), except that the
Borrower may not assign or otherwise transfer any of its rights or obligations
hereunder without the prior written consent of each Lender (and any attempted
assignment or transfer by the Borrower without such consent shall be null and
void). Nothing in this Agreement, expressed or implied, shall be construed to
confer upon any Person (other than the parties hereto, their respective
successors and assigns permitted hereby (including any Affiliate of the Issuing
Bank that issues any Letter of Credit) and, to the extent expressly contemplated
hereby, the Related Parties of each of the Administrative Agent, the Issuing
Bank and the Lenders) any legal or equitable right, remedy or claim under or by
reason of this Agreement.
(b) Any Lender may assign to one or more assignees all or a
portion of its rights and obligations under this Agreement (including all or a
portion of its Commitment and the Loans at the time owing to it); provided that
(i) except in the case of an assignment to a Lender or an Affiliate of a Lender,
each of the Borrower and the Administrative Agent (and, in the case of an
assignment of all or a portion of a Commitment or any Lender's obligations in
respect of its LC Exposure and the Issuing Bank) must give their prior written
consent to such assignment (which consent shall not be unreasonably withheld),
(ii) except in the case of an assignment to a Lender or an Affiliate of a Lender
or an assignment of the entire remaining amount of the assigning Lender's
Commitment, the amount of the Commitment of the assigning Lender subject to each
such assignment (determined as of the date the Assignment and
57
Acceptance with respect to such assignment is delivered to the Administrative
Agent) shall not be less than $5,000,000 unless each of the Borrower and the
Administrative Agent otherwise consent, (iii) each partial assignment shall be
made as an assignment of a proportionate part of all the assigning Lender's
rights and obligations under this Agreement, (iv) the parties to each assignment
shall execute and deliver to the Administrative Agent an Assignment and
Acceptance, together with a processing and recordation fee of $3,500, and (v)
the assignee, if it shall not be a Lender, shall deliver to the Administrative
Agent an Administrative Questionnaire; and provided further that any consent of
the Borrower otherwise required under this paragraph shall not be required if an
Event of Default has occurred and is continuing. Subject to acceptance and
recording thereof pursuant to paragraph (d) of this Section, from and after the
effective date specified in each Assignment and Acceptance the assignee
thereunder shall be a party hereto and, to the extent of the interest assigned
by such Assignment and Acceptance, have the rights and obligations of a Lender
under this Agreement, and the assigning Lender thereunder shall, to the extent
of the interest assigned by such Assignment and Acceptance, be released from its
obligations under this Agreement (and, in the case of an Assignment and
Acceptance covering all of the assigning Lender's rights and obligations under
this Agreement, such Lender shall cease to be a party hereto but shall continue
to be entitled to the benefits of Sections 2.13, 2.14, 2.15 and 9.03). Any
assignment or transfer by a Lender of rights or obligations under this Agreement
that does not comply with this paragraph shall be treated for purposes of this
Agreement as a sale by such Lender of a participation in such rights and
obligations in accordance with paragraph (e) of this Section. Any assignment of
a given percentage of a Lender's General Revolving Commitment shall cover the
same percentage of such Lender's Working Capital Revolving Commitment, and vice
versa.
(c) The Administrative Agent, acting for this purpose as an
agent of the Borrower, shall maintain at one of its offices in The City of New
York a copy of each Assignment and Acceptance delivered to it and a register for
the recordation of the names and addresses of the Lenders, and the Commitment
of, and principal amount of the Loans and LC Disbursements owing to, each Lender
pursuant to the terms hereof from time to time (the "Register"). The entries in
the Register shall be conclusive, and the Borrower, the Administrative Agent,
the Issuing Bank and the Lenders may treat each Person whose name is recorded in
the Register pursuant to the terms hereof as a Lender hereunder for all purposes
of this Agreement, notwithstanding notice to the contrary. The Register shall be
available for inspection by the Borrower, the Issuing Bank and any Lender, at
any reasonable time and from time to time upon reasonable prior notice.
(d) Upon its receipt of a duly completed Assignment and
Acceptance executed by an assigning Lender and an assignee, the assignee's
completed Administrative Questionnaire (unless the assignee shall already be a
Lender hereunder), the processing and recordation fee referred to in paragraph
(b) of this Section and any written consent to such assignment required by
paragraph (b) of this Section, the Administrative Agent shall accept such
Assignment and Acceptance and record the information contained therein in the
Register. No assignment shall be effective for purposes of this Agreement unless
it has been recorded in the Register as provided in this paragraph.
(e) Any Lender may, without the consent of the Borrower, the
Administrative Agent or the Issuing Bank, sell participations to one or more
banks or other entities (a
58
"Participant") in all or a portion of such Lender's rights and obligations under
this Agreement (including all or a portion of its Commitment and the Loans owing
to it); provided that (i) such Lender's obligations under this Agreement shall
remain unchanged, (ii) such Lender shall remain solely responsible to the other
parties hereto for the performance of such obligations and (iii) the Borrower,
the Administrative Agent, the Issuing Bank and the other Lenders shall continue
to deal solely and directly with such Lender in connection with such Lender's
rights and obligations under this Agreement. Any agreement or instrument
pursuant to which a Lender sells such a participation shall provide that such
Lender shall retain the sole right to enforce this Agreement and to approve any
amendment, modification or waiver of any provision of this Agreement; provided
that such agreement or instrument may provide that such Lender will not, without
the consent of the Participant, agree to any amendment, modification or waiver
described in the first proviso to Section 9.02(b) that affects such Participant.
Subject to paragraph (f) of this Section, the Borrower agrees that each
Participant shall be entitled to the benefits of Sections 2.13, 2.14 and 2.15 to
the same extent as if it were a Lender and had acquired its interest by
assignment pursuant to paragraph (b) of this Section. To the extent permitted by
law, each Participant also shall be entitled to the benefits of Section 9.08 as
though it were a Lender, provided such Participant agrees to be subject to
Section 2.16(c) as though it were a Lender.
(f) A Participant shall not be entitled to receive any greater
payment under Section 2.13 or 2.15 than the applicable Lender would have been
entitled to receive with respect to the participation sold to such Participant,
unless the sale of the participation to such Participant is made with the
Borrower's prior written consent. A Participant that would be a Foreign Lender
if it were a Lender shall not be entitled to the benefits of Section 2.15 unless
the Borrower is notified of the participation sold to such Participant and such
Participant agrees, for the benefit of the Borrower, to comply with Section
2.15(e) as though it were a Lender.
(g) Any Lender may at any time pledge or assign a security
interest in all or any portion of its rights under this Agreement to secure
obligations of such Lender, including any pledge or assignment to secure
obligations to a Federal Reserve Bank, and this Section shall not apply to any
such pledge or assignment of a security interest; provided that no such pledge
or assignment of a security interest shall release a Lender from any of its
obligations hereunder or substitute any such pledgee or assignee for such Lender
as a party hereto.
SECTION 9.05. Survival. All covenants, agreements, representations and
warranties made by the Borrower herein and in the certificates or other
instruments delivered in connection with or pursuant to this Agreement shall be
considered to have been relied upon by the other parties hereto and shall
survive the execution and delivery of this Agreement and the making of any Loans
and issuance of any Letters of Credit, regardless of any investigation made by
any such other party or on its behalf and notwithstanding that the
Administrative Agent, the Issuing Bank or any Lender may have had notice or
knowledge of any Default or incorrect representation or warranty at the time any
credit is extended hereunder, and shall continue in full force and effect as
long as the principal of or any accrued interest on any Loan or any fee or any
other amount payable under this Agreement is outstanding and unpaid or any
Letter of Credit is outstanding and so long as the Commitments have not expired
or terminated. The provisions of Sections 2.13, 2.14, 2.15 and 9.03 and Article
VIII shall survive and remain in full force and effect regardless of the
consummation of the transactions contemplated hereby, the repayment of
59
the Loans, the expiration or termination of the Letters of Credit and the
Commitments or the termination of this Agreement or any provision hereof.
SECTION 9.06. Counterparts; Integration; Effectiveness. This Agreement
may be executed in counterparts (and by different parties hereto on different
counterparts), each of which shall constitute an original, but all of which when
taken together shall constitute a single contract. This Agreement and any
separate letter agreements with respect to fees payable to the Administrative
Agent constitute the entire contract among the parties relating to the subject
matter hereof and supersede any and all previous agreements and understandings,
oral or written, relating to the subject matter hereof. Except as provided in
Section 4.01, this Agreement shall become effective when it shall have been
executed by the Administrative Agent and when the Administrative Agent shall
have received counterparts hereof which, when taken together, bear the
signatures of each of the other required parties hereto, and thereafter shall be
binding upon and inure to the benefit of the parties hereto and their respective
successors and assigns. Delivery of an executed counterpart of a signature page
of this Agreement by telecopy shall be effective as delivery of a manually
executed counterpart of this Agreement.
SECTION 9.07. Severability. Any provision of this Agreement held to be
invalid, illegal or unenforceable in any jurisdiction shall, as to such
jurisdiction, be ineffective to the extent of such invalidity, illegality or
unenforceability without affecting the validity, legality and enforceability of
the remaining provisions hereof; and the invalidity of a particular provision in
a particular jurisdiction shall not invalidate such provision in any other
jurisdiction.
SECTION 9.08. Right of Setoff. If an Event of Default shall have
occurred and be continuing, each Lender and each of its Affiliates 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 obligations at any time
owing by such Lender or Affiliate to or for the credit or the account of the
Borrower against any of and all the obligations of the Borrower now or hereafter
existing under this Agreement held by such Lender, irrespective of whether or
not such Lender shall have made any demand under this Agreement and although
such obligations may be unmatured. The rights of each Lender under this Section
are in addition to other rights and remedies (including other rights of setoff)
which such Lender may have.
SECTION 9.09. Governing Law; Jurisdiction; Consent to Service of
Process. (a) This Agreement shall be construed in accordance with and governed
by the law of the State of New York.
(b) The Borrower hereby irrevocably and unconditionally
submits, for itself and its property, to the nonexclusive jurisdiction of the
Supreme Court of the State of New York sitting in New York County and of the
United States District Court of the Southern District of New York, and any
appellate court from any thereof, in any action or proceeding arising out of or
relating to this Agreement, or for recognition or enforcement of any judgment,
and each of the parties hereto hereby irrevocably and unconditionally agrees
that all claims in respect of any such action or proceeding may be heard and
determined in such New York State or, to the extent permitted by law, in such
Federal court. Each of the parties hereto agrees that a final judgment in any
such action or proceeding shall be conclusive and may be enforced in other
jurisdictions
60
by suit on the judgment or in any other manner provided by law. Nothing in this
Agreement shall affect any right that the Administrative Agent, the Issuing Bank
or any Lender may otherwise have to bring any action or proceeding relating to
this Agreement against the Borrower or its properties in the courts of any
jurisdiction.
(c) The Borrower hereby irrevocably and unconditionally
waives, to the fullest extent it may legally and effectively do so, any
objection which it may now or hereafter have to the laying of venue of any suit,
action or proceeding arising out of or relating to this Agreement in any court
referred to in paragraph (b) of this Section. Each of the parties hereto hereby
irrevocably waives, to the fullest extent permitted by law, the defense of an
inconvenient forum to the maintenance of such action or proceeding in any such
court.
(d) Each party to this Agreement irrevocably consents to
service of process in the manner provided for notices in Section 9.01. Nothing
in this Agreement will affect the right of any party to this Agreement to serve
process in any other manner permitted by law.
SECTION 9.10. WAIVER OF JURY TRIAL. EACH PARTY HERETO HEREBY WAIVES, TO
THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL
BY JURY IN ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF OR
RELATING TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY (WHETHER
BASED ON CONTRACT, TORT OR ANY OTHER THEORY). EACH PARTY HERETO (A) CERTIFIES
THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED,
EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF
LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND (B) ACKNOWLEDGES THAT IT
AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THIS AGREEMENT BY,
AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION.
SECTION 9.11. Headings. Article and Section headings and the Table of
Contents used herein are for convenience of reference only, are not part of this
Agreement and shall not affect the construction of, or be taken into
consideration in interpreting, this Agreement.
SECTION 9.12. Confidentiality. Each of the Administrative Agent, the
Issuing Bank and the Lenders agrees to maintain the confidentiality of the
Information (as defined below), except that Information may be disclosed (a) to
its and its Affiliates' directors, officers, employees and agents, including
accountants, legal counsel and other advisors (it being understood that the
Persons to whom such disclosure is made will be informed of the confidential
nature of such Information and instructed to keep such Information
confidential), (b) to the extent requested by any regulatory authority, (c) to
the extent required by applicable laws or regulations or by any subpoena or
similar legal process, (d) to any other party to this Agreement, (e) in
connection with the exercise of any remedies hereunder or any suit, action or
proceeding relating to this Agreement or the enforcement of rights hereunder,
(f) subject to an agreement containing provisions substantially the same as
those of this Section, to any assignee of or Participant in, or any prospective
assignee of or Participant in, any of its rights or obligations under this
Agreement, (g) with the consent of the Borrower or (h) to the extent such
Information (i) becomes publicly available other than as a result of a breach of
this Section or
61
(ii) becomes available to the Administrative Agent, the Issuing Bank or any
Lender on a nonconfidential basis from a source other than the Borrower. For the
purposes of this Section, "Information" means all information received from the
Borrower relating to the Borrower or its business, other than any such
information that is available to the Administrative Agent, the Issuing Bank or
any Lender on a nonconfidential basis prior to disclosure by the Borrower;
provided that, in the case of information received from the Borrower after the
Original Agreement Date, such information is clearly identified at the time of
delivery as confidential. Any Person required to maintain the confidentiality of
Information as provided in this Section shall be considered to have complied
with its obligation to do so if such Person has exercised the same degree of
care to maintain the confidentiality of such Information as such Person would
accord to its own confidential information.
SECTION 9.13. Interest Rate Limitation. Notwithstanding anything herein
to the contrary, if at any time the interest rate applicable to any Loan,
together with all fees, charges and other amounts which are treated as interest
on such Loan under applicable law (collectively the "Charges"), shall exceed the
maximum lawful rate (the "Maximum Rate") which may be contracted for, charged,
taken, received or reserved by the Lender holding such Loan in accordance with
applicable law, the rate of interest payable in respect of such Loan hereunder,
together with all Charges payable in respect thereof, shall be limited to the
Maximum Rate and, to the extent lawful, the interest and Charges that would have
been payable in respect of such Loan but were not payable as a result of the
operation of this Section shall be cumulated and the interest and Charges
payable to such Lender in respect of other Loans or periods shall be increased
(but not above the Maximum Rate therefor) until such cumulated amount, together
with interest thereon at the Federal Funds Effective Rate to the date of
repayment, shall have been received by such Lender.
SECTION 9.14. Limitation of Liability. Neither the General Partner nor the
general partner(s) of the MLP shall be liable for (a) the obligations of the
Borrower under this Agreement or (b) the obligations of the MLP under the MLP
Guaranty, including in each case, without limitation, by reason of any payment
obligation imposed by governing state partnership statutes and any provision of
the applicable limited partnership agreement of the Borrower or the MLP that
requires such General Partner or general partner(s), as the case may be, to
restore a capital account deficit.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed by their respective authorized officers as of the Restatement
Agreement Date.
VALERO LOGISTICS OPERATIONS, L.P.
By: Valero GP, Inc., its General Partner
By: /s/ Steven A. Blank
--------------------------------------
Name: Steven A. Blank
Title: Senior Vice President and Chief
Financial Officer
62
JPMORGAN CHASE BANK, individually and as
Administrative Agent
By /s/ Robert C. Mertensotto
--------------------------------------
Name: Robert C. Mertensotto
Title: Managing Director
Signature Page to
Amended and Restated Credit Agreement - 2
ROYAL BANK OF CANADA
By /s/ Linda M. Stephen
--------------------------------------
Name: Linda M. Stephen
Title: Senior Manager
Signature Page to
Amended and Restated Credit Agreement - 3
SUNTRUST BANK
By /s/ David J. Edge
--------------------------------------
Name: David J. Edge
Title: Director
Signature Page to
Amended and Restated Credit Agreement - 4
MIZUHO CORPORATE BANK, LIMITED
THE INDUSTRIAL BANK OF JAPAN TRUST COMPANY
By /s/ Jacques Azagury
---------------------------------------
Name: Jacques Azagury
Title: Senior Vice President & Manager
Signature Page to
Amended and Restated Credit Agreement - 5
BARCLAYS BANK PLC
By /s/ Nicholas A. Bell
---------------------------------------------
Name: Nicholas A. Bell
Title : Director, Loan Transaction Management
Signature Page to
Amended and Restated Credit Agreement - 6
SUMITOMO MITSUI BANKING CORPORATION
By /s/ Leo E. Pagarigan
-----------------------------------
Name: Leo E. Pagarigan
Title: Senior Vice President
Signature Page to
Amended and Restated Credit Agreement - 7
AUSTRALIA AND NEW ZEALAND BANKING
GROUP LIMITED
By /s/ R. Scott McInnis
------------------------------------
Name: R. Scott McInnis
Title: Head, Global Structured
Finance-Americas
Signature Page to
Amended and Restated Credit Agreement - 8
THE BANK OF NOVA SCOTIA
By /s/ N. Bell
-------------
Name: N. Bell
Title: Senior Manager
Signature Page to
Amended and Restated Credit Agreement - 9
COMPASS BANK
By /s/ Collis Sanders
--------------------------------
Name: Collis Sanders
Title: Senior Vice President
By /s/ Ed Jones
--------------------------------
Name: Ed Jones
Title: Executive Vice President
Signature Page to
Amended and Restated Credit Agreement - 10
SCHEDULE 2.01
<Table>
<Caption>
LENDER COMMITMENT
------ ----------
JPMorgan Chase Bank $20,000,000
Royal Bank of Canada $20,000,000
SunTrust Bank $20,000,000
Mizuho Corporate Bank, Limited. $20,000,000
Barclays Bank PLC $20,000,000
Sumitomo Mitsui Banking Corporation $15,000,000
The Bank of Tokyo - Mitsubishi, Ltd. $15,000,000
Australia and New Zealand Banking Group Limited $15,000,000
The Bank of Nova Scotia $15,000,000
Compass Bank $15,000,000
</Table>
Schedule 2.01
SCHEDULE 3.06
Disclosed Matters
None.
Schedule 3.06
SCHEDULE 6.07
Affiliate Agreements
None.
Schedule 6.07
SCHEDULE 6.08
Existing Restrictions
The Indenture.
The First Supplemental Indenture to the Indenture, dated as of July 15, 2002.
Schedule 6.08
EXHIBIT A
[FORM OF]
ASSIGNMENT AND ACCEPTANCE
Reference is made to the Credit Agreement dated as of December 15, 2000
as amended and restated through March 6, 2003 (as amended and in effect on the
date hereof, the "Credit Agreement"), among Valero Logistics Operations, L.P.,
the Lenders named therein and JPMorgan Chase Bank, as Administrative Agent for
the Lenders. Terms defined in the Credit Agreement are used herein with the same
meanings.
The Assignor named on the reverse hereof hereby sells and assigns,
without recourse, to the Assignee named on the reverse hereof, and the Assignee
hereby purchases and assumes, without recourse, from the Assignor, effective as
of the Assignment Date set forth on the reverse hereof, the interests set forth
on the reverse hereof (the "Assigned Interest") in the Assignor's rights and
obligations under the Credit Agreement, including, without limitation, the
interests set forth on the reverse hereof in the Commitment of the Assignor on
the Assignment Date and Loans owing to the Assignor which are outstanding on the
Assignment Date, together with the participations in Letters of Credit and LC
Disbursements held by the Assignor on the Assignment Date, but excluding accrued
interest and fees to and excluding the Assignment Date. The Assignee hereby
acknowledges receipt of a copy of the Credit Agreement. From and after the
Assignment Date (i) the Assignee shall be a party to and be bound by the
provisions of the Credit Agreement and, to the extent of the Assigned Interest,
have the rights and obligations of a Lender thereunder and (ii) the Assignor
shall, to the extent of the Assigned Interest, relinquish its rights and be
released from its obligations under the Credit Agreement.
This Assignment and Acceptance is being delivered to the Administrative
Agent together with (i) if the Assignee is a Foreign Lender, any documentation
required to be delivered by the Assignee pursuant to Section 2.15(e) of the
Credit Agreement, duly completed and executed by the Assignee, and (ii) if the
Assignee is not already a Lender under the Credit Agreement, an Administrative
Questionnaire in the form supplied by the Administrative Agent, duly completed
by the Assignee. The Assignee/Assignor shall pay the fee payable to the
Administrative Agent pursuant to Section 9.04(b) of the Credit Agreement.
This Assignment and Acceptance shall be governed by and construed in
accordance with the laws of the State of New York.
Date of Assignment:
Legal Name of Assignor:
Legal Name of Assignee:
Assignee's Address for Notices:
Effective Date of Assignment
("Assignment Date"):
Exhibit A-1
<Table>
<Caption>
Percentage Assigned of
Facility/Commitment (set forth, to at
least 8 decimals, as a percentage of the
Facility and the aggregate Commitments
Facility Principal Amount Assigned of all Lenders thereunder)
- -------------------- ------------------------- ----------------------------------------
Commitment Assigned: $ %
Loans:
</Table>
The terms set forth above and on the reverse side hereof are hereby agreed to:
[Name of Assignor] , as Assignor
By:
--------------------------------
Name:
Title:
[Name of Assignee] , as Assignee
By:
--------------------------------
Name:
Title:
Exhibit A-2
The undersigned hereby consent to the within assignment:
Valero Logistics Operations, L.P., JPMorgan Chase Bank,
as Administrative Agent,
By: By:
------------------------ --------------------------------
Name: Name:
Title: Title:
JPMorgan Chase Bank,
as Issuing Bank
By:
--------------------------------
Name:
Title:
Exhibit A-3
EXHIBIT B
OPINION OF COUNSEL FOR THE BORROWER
March 6, 2003
To the Lenders and the Administrative
Agent Referred to Below
c/o The Chase Manhattan Bank, as
Administrative Agent
270 Park Avenue
New York, New York 10017
Dear Sirs:
[I/We] have acted as counsel for Valero Logistics Operations, L.P. (the
"Borrower") and Valero, L.P. (the "MLP", and together with the Borrower, the
"Loan Parties"), in connection with the Credit Agreement dated as of December
15, 2000 as amended and restated through March 6, 2003 (the "Credit Agreement"),
among the Borrower, the banks and other financial institutions identified
therein as Lenders, and JPMorgan Chase Bank, as Administrative Agent and the
other Loan Documents identified below. This opinion is being furnished to you
pursuant to Section 4.01(b) of the Agreement. Unless otherwise defined herein,
terms defined in the Credit Agreement and used herein shall have the meanings
given to them in the Credit Agreement.
In that connection, we have examined executed copies of the Credit
Agreement, the MLP Guaranty, and the notes executed and delivered on the date
hereof pursuant to Section 2.08(e) of the Credit Agreement (the "Loan
Documents").
In addition, [I, or individuals under my direction,/We] have examined
originals or copies, certified or otherwise identified to [my/our] satisfaction,
of such documents, corporate records, certificates of public officials and other
instruments and have conducted such other investigations of fact and law as
[I/we] have deemed necessary or advisable for purposes of this opinion.
Upon the basis of the foregoing, [I am/we are] of the opinion that:
1. The Loan Documents constitute the legal, valid and binding obligations
of the Loan Parties party thereto, enforceable against such Loan
Parties under the law of the State of New York in accordance with their
respective terms.
2. In a case properly argued and presented, a Texas court or a Federal
court sitting in Texas and applying Texas conflict of law principles,
as set out in Section 35.51 of the Texas Business and Commerce Code,
would give effect to the provisions of the Credit Agreement and the MLP
Guaranty selecting New York law as governing, and would apply the
substantive laws of the State of New York in construing the Credit
Agreement and the MLP Guaranty.
3. Under the circumstances contemplated by the Credit Agreement, the
making of the Loans will not violate Section 7 of the Securities
Exchange Act of 1934, as amended, or any
Exhibit B - 1
regulation issued pursuant thereto, including without limitation, the
provisions of Regulation T, U or X of the Board of Governors of the
Federal Reserve System.
4. The Borrower is not an "investment company" within the meaning of the
Investment Company Act of 1940, as amended.
5. The Borrower is not subject to, or is exempt from, regulation as a
"holding company" under the Public Utility Holding Company Act of 1935,
as amended.
6. The Borrower (a) is a limited partnership duly formed and validly
existing under the laws of the State of Delaware and (b) has the
limited partnership power and authority to (i) own property and conduct
the business in which it is currently engaged and in which it proposes,
as of the date hereof, to be engaged after the date hereof, (ii) make,
deliver and perform the Loan Documents to which it is a party in
accordance with the terms and provisions thereof and (iii) borrow under
the Credit Agreement.
7. The MLP (a) is a limited partnership duly formed and validly existing
under the laws of the State of Delaware and (b) has the limited
partnership power and authority to (i) own property and conduct the
business in which it is currently engaged and in which it proposes, as
of the date hereof, to be engaged after the date hereof, and (ii) make,
deliver and perform the MLP Guaranty in accordance with the terms and
provisions thereof.
8. The execution, delivery and performance of the Credit Agreement by the
Borrower, and of the MLP Guaranty by the MLP, and the borrowings by the
Borrower under the Credit Agreement, have been duly authorized by all
necessary actions on behalf of the Loan Parties and each other Person
whose authorization is relevant to, or constitutes, authorization on
behalf of either Loan Party.
9. The Loan Documents have been duly executed and delivered on behalf of
the Loan Parties, as applicable.
10. No approvals or consents of any governmental authority of the State of
Texas or the United States of America or other consents or approvals by
any other Person which have not been obtained on or prior to the date
hereof are required (a) in connection with the participation by the
Loan Parties in connection with the transactions under the Loan
Documents or the execution, delivery and performance by either Loan
Party of the Loan Documents to which it is a party, or (b) for the
validity and enforceability of the Loan Documents and the exercise by
the Lenders of their rights and remedies thereunder.
11. The execution, delivery and performance by the Loan Parties of the Loan
Documents will not (a) violate any provision of the Partnership
Agreement (Borrower), or the Partnership Agreement (MLP), (b) result in
the breach of, or constitute a default under, any indenture or loan or
credit agreement or any other material agreement, lease or instrument,
known to me after due inquiry, to which either of the Loan Parties is a
party or by which its properties may be bound, (c) result in, or
require, the creation or imposition of any Lien on any of its
properties or revenues pursuant to any requirement of law, rule
regulation or order of any governmental authority of the State of Texas
or the United States of America or material contractual obligation
binding upon either Loan Party, or (d) result in any violation by
either Loan Party of any applicable law of the State of Texas or the
United States of America.
12. The partnership interests in the Borrower listed on Schedule A hereto
constitute all the partnership interests of record in the Borrower and
are owned of record by the Persons designated on Schedule A.
Exhibit B - 2
13. The Borrower is not subject to regulation under any statute or
regulation of the State of Texas or the United States of America that
limits its ability to incur indebtedness.
14. To my knowledge (having made due inquiry with respect thereto), no
litigation, investigation or proceeding of or before any arbitrator or
governmental authority is pending or threatened by or against the MLP
or the Borrower or against any of the properties or revenues of either
(a) with respect to the Loan Documents or any of the transactions
contemplated thereby or (b) which, if adversely determined, could
reasonably be expected to have a Material Adverse Effect.
Exhibit B - 3
================================================================================
EXHIBIT C-1
FORM OF
MLP GUARANTY AGREEMENT
MADE BY
VALERO, L.P.
IN FAVOR OF
JPMORGAN CHASE BANK,
AS ADMINISTRATIVE AGENT
DATED AS OF MARCH 6, 2003
================================================================================
Exhibit C-1
TABLE OF CONTENTS
<Table>
SECTION 1. DEFINED TERMS .....................................................1
1.1 Definitions .......................................................1
1.2 Other Definitional Provisions .....................................2
SECTION 2. GUARANTEE .........................................................2
2.1 Guarantee .........................................................2
2.2 No Subrogation ....................................................3
2.3 Amendments, etc. with respect to the Borrower Obligations .........3
2.4 Guarantee Absolute and Unconditional ..............................4
2.5 Reinstatement .....................................................5
2.6 Payments ..........................................................5
SECTION 3. REPRESENTATIONS AND WARRANTIES ....................................5
3.1 Organization; Powers ..............................................5
3.2 Authorization; Enforceability .....................................6
3.3 Governmental Approvals; No Conflicts ..............................6
3.4 Investment and Holding Company Status .............................6
SECTION 4. INTENTIONALLY OMITTED .............................................6
SECTION 5. THE ADMINISTRATIVE AGENT ..........................................6
5.1 Authority of Administrative Agent .................................6
SECTION 6. MISCELLANEOUS .....................................................6
6.1 Amendments in Writing .............................................6
6.2 Notices ...........................................................6
6.3 No Waiver by Course of Conduct; Cumulative Remedies ...............7
6.4 Enforcement Expenses; Indemnification .............................7
6.5 Successors and Assigns ............................................7
6.6 Counterparts ......................................................7
6.7 Severability ......................................................7
6.8 Integration .......................................................8
6.9 GOVERNING LAW .....................................................8
6.10 Submission To Jurisdiction; Waivers ...............................8
6.11 Acknowledgments ...................................................8
6.12 WAIVERS OF JURY TRIAL .............................................9
6.13 Section Headings ..................................................9
</Table>
Exhibit C-1
MLP GUARANTY AGREEMENT, dated as of March 6, 2003, made by Valero,
L.P., a Delaware limited partnership formerly known as Shamrock Logistics, L.P.
(the "Parent Guarantor") in favor of JPMorgan Chase Bank, formerly known as The
Chase Manhattan Bank, as Administrative Agent (in such capacity, the
"Administrative Agent") for the benefit of the banks and other financial
institutions or entities (the "Lenders") parties to the Credit Agreement, dated
as of December 15, 2000 as amended and restated through March 6, 2003, (the
"Credit Agreement"), among Valero Logistics Operations, L.P., a Delaware limited
partnership formerly known as Shamrock Logistics Operations, L.P. (the
"Borrower"), the Lenders, the Administrative Agent, Royal Bank of Canada, as
syndication agent and SunTrust Bank, as documentation agent.
WITNESSETH:
WHEREAS, pursuant to the Credit Agreement, the Lenders have severally
agreed to make extensions of credit to the Borrower upon the terms and subject
to the conditions set forth therein;
WHEREAS, the Borrower is a member of an affiliated group of companies
that includes the Parent Guarantor;
WHEREAS, the proceeds of the extensions of credit under the Credit
Agreement may be or have been used in part to enable the Borrower to make
valuable transfers to the Parent Guarantor;
WHEREAS, the Parent Guarantor will derive substantial direct and
indirect benefit from the making of the extensions of credit under the Credit
Agreement; and
WHEREAS, it is a condition precedent to the Credit Agreement that the
Parent Guarantor shall have executed and delivered this Agreement to the
Administrative Agent for the ratable benefit of the Lenders;
NOW, THEREFORE, in consideration of the premises and to induce the
Lenders to agree to make their respective extensions of credit to the Borrower
under the Credit Agreement, the Parent Guarantor hereby agrees with the
Administrative Agent, for the ratable benefit of the Lenders, as follows:
SECTION 1. DEFINED TERMS
1.1 Definitions. (a) Unless otherwise defined herein, terms defined in
the Credit Agreement and used herein shall have the meanings given to them in
the Credit Agreement.
(b) The following terms shall have the following meanings:
"Agreement": means this MLP Guaranty Agreement, as the same may be
amended, supplemented or otherwise modified from time to time.
"Borrower Obligations": means the collective reference to all
Indebtedness owing by the Borrower pursuant to the Credit Agreement, including,
without limitation, the unpaid principal
Exhibit C-1-1
of and interest on the Loans and LC Disbursements and all other obligations and
liabilities of the Borrower (including, without limitation, interest accruing at
the then applicable rate provided in the Credit Agreement after the maturity of
the Loans and LC Disbursements and interest accruing at the then applicable rate
provided in the Credit Agreement after the filing of any petition in bankruptcy,
or the commencement of any insolvency, reorganization or like proceeding,
relating to the Borrower, whether or not a claim for post-filing or
post-petition interest is allowed in such proceeding) to the Administrative
Agent or any Lender (or, in the case of any Hedging Agreement referred to below,
any Affiliate of a Lender), whether direct or indirect, absolute or contingent,
due or to become due, or now existing or hereafter incurred, which may arise
under, out of, or in connection with, the Credit Agreement, this Agreement, any
Letter of Credit, any Hedging Agreement entered into by the Borrower with any
Lender (or any Affiliate of a Lender) or the other Loan Documents or any other
document made, delivered or given in connection therewith, in each case whether
on account of principal, interest, reimbursement obligations, fees, indemnities,
costs, expenses or otherwise (including, without limitation, all fees and
disbursements of counsel to the Administrative Agent or to the Lenders that are
required to be paid by the Borrower pursuant to the terms of any of the
foregoing agreements).
"Parent Guarantor Obligations": means the collective reference to (i)
the Borrower Obligations and (ii) all obligations and liabilities of the Parent
Guarantor which may arise under or in connection with this Agreement, in each
case whether on account of guarantee obligations, reimbursement obligations,
loan obligations, fees, indemnities, costs, expenses or otherwise (including,
without limitation, all fees and disbursements of counsel to the Administrative
Agent or to the Lenders that are required to be paid by the Parent Guarantor
pursuant to the terms of this Agreement or any other Loan Document).
1.2 Other Definitional Provisions. (a) The words "hereof," "herein",
"hereto" 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 Section and Schedule references are to this Agreement unless
otherwise specified.
(b) The meanings given to terms defined herein shall be equally
applicable to both the singular and plural forms of such terms.
(c) A reference to any Person hereunder shall be deemed to include a
reference to such Person's successor's, endorsees, transferees and assigns.
SECTION 2. GUARANTEE
2.1 Guarantee. (a) The Parent Guarantor, to the maximum extent
permitted by applicable law, (i) absolutely, unconditionally and irrevocably,
guarantees to the Administrative Agent for the ratable benefit of the Lenders
and their respective successors, endorsees, transferees and assigns, the prompt
and complete payment and performance by the Borrower when due (whether at the
stated maturity, by acceleration or otherwise) of the Borrower Obligations and
(ii) indemnifies and holds harmless the Administrative Agent and each Lender
from, and agrees to pay to the Administrative Agent and each Lender, all
reasonable costs and expenses (including reasonable counsel fees and expenses)
incurred by the Administrative Agent
Exhibit C-1-2
or such Lender in enforcing any of its rights under this Agreement. The Parent
Guarantor agrees that notwithstanding any stay, injunction or other prohibition
preventing the payment by the Borrower of all or any portion of the Borrower
Obligations and notwithstanding that all or any portion of the Borrower
Obligations may be unenforceable or not allowable due to the existence of a
bankruptcy, reorganization or similar proceeding involving the Borrower, to the
maximum extent permitted by applicable law, such Borrower Obligations shall
nevertheless be due and payable by the Parent Guarantor for the purposes of this
Agreement at the time such Borrower Obligations would by payable by the Borrower
under the provisions of the Credit Agreement. Notwithstanding the foregoing, any
enforcement of this Agreement with respect to the rights of any Lender shall be
accomplished by the Administrative Agent acting on behalf of such Lender.
(b) The guarantee contained in this Section 2.1 is a continuing
guarantee and shall remain in full force and effect until all the Borrower
Obligations and the obligations of the Parent Guarantor under the guarantee
contained in this Section 2.1 shall have been satisfied by payment in full, no
Letter of Credit shall be outstanding and the Commitments shall be terminated,
notwithstanding that from time to time during the term of the Credit Agreement
the Borrower may be free from any Borrower Obligations.
(c) No payment made by the Borrower, the Parent Guarantor, any other
guarantor or any other Person or received or collected by the Administrative
Agent or any Lender from the Borrower, the Parent Guarantor, any other guarantor
or any other Person by virtue of any action or proceeding or any set-off or
appropriation or application at any time or from time to time in reduction of or
in payment of the Borrower Obligations shall be deemed to modify, reduce,
release or otherwise affect the liability of the Parent Guarantor hereunder
which shall, notwithstanding any such payment (other than any payment made by
the Borrower or Parent Guarantor in respect of the Borrower Obligations or any
payment received or collected from the Borrower or Parent Guarantor in respect
of the Borrower Obligations), remain liable for the Borrower Obligations until,
subject to Section 2.5, the Borrower Obligations are paid in full, no Letter of
Credit shall be outstanding and the Commitments are terminated.
2.2 Subrogation. The Parent Guarantor shall be subrogated to all the
rights of the Administrative Agent or any Lender against the Borrower in respect
of any amounts paid by the Parent Guarantor pursuant to the provisions of this
Agreement; provided, however, that the Parent Guarantor shall not be entitled to
enforce or to receive any payments arising out of, or based upon, such right of
subrogation with respect to any of the Borrower Obligations until all of the
Borrower Obligations and the Guarantees thereof shall have been indefeasibly
paid in full or discharged. A director, officer, employee or stockholder, as
such, of the Parent Guarantor shall not have any liability for any obligations
of the Guarantor under this Agreement or any claim based on, in respect of or by
reason of such obligations or their creation.
2.3 Amendments, etc. with respect to the Borrower Obligations. The
Parent Guarantor shall remain obligated hereunder notwithstanding that, without
any reservation of rights against the Parent Guarantor and without notice to or
further assent by the Parent Guarantor, any demand for payment of any of the
Borrower Obligations made by the Administrative Agent or any Lender may be
rescinded by the Administrative Agent or such Lender and any of the Borrower
Obligations continued, and the Borrower Obligations, or the liability of any
other Person upon or for any part thereof, or any collateral security or
guarantee
Exhibit C-1-3
therefor or right of offset with respect thereto, may, from time to time, in
whole or in part, be renewed, extended, amended, modified, accelerated,
compromised, waived, surrendered or released by the Administrative Agent or any
Lender, and the Credit Agreement and the other Loan Documents and any other
documents executed and delivered in connection therewith may be amended,
modified, supplemented or terminated, in whole or in part, as the Administrative
Agent (or the Required Lenders or all Lenders, as the case may be) may deem
advisable from time to time, and any collateral security, guarantee or right of
offset at any time held by the Administrative Agent or any Lender for the
payment of the Borrower Obligations may be sold, exchanged, waived, surrendered
or released. Except as required by applicable law, neither the Administrative
Agent nor any Lender shall have any obligation to protect, secure, perfect or
insure any Lien at any time held by it as security for the Borrower Obligations
or for the guarantee contained in this Section 2 or any property subject
thereto.
2.4 Guarantee Absolute and Unconditional. To the fullest extent
permitted by applicable law, the Parent Guarantor hereby (i) waives diligence,
presentment, demand of payment, notice of acceptance, filing of claims with a
court in the event of the merger, insolvency or bankruptcy of the Borrower or
the Parent Guarantor, and all demands and notices whatsoever, (ii) acknowledges
that any agreement, instrument or document evidencing the Parent Guarantor
Obligations may be transferred and that the benefit of its obligations hereunder
shall extend to each holder of any agreement, instrument or document evidencing
the Parent Guarantor Obligations without notice to them and (iii) covenants that
the Parent Guarantor Obligations will not be discharged except by complete
performance thereof. The Parent Guarantor further agrees that to the fullest
extent permitted by applicable law, if at any time all or any part of any
payment theretofore applied by any Person to any of the Parent Guarantor
Obligations is, or must be, rescinded or returned for any reason whatsoever,
including without limitation, the insolvency, bankruptcy or reorganization of
the Parent Guarantor, such Parent Guarantor Obligations shall, to the extent
that such payment is or must be rescinded or returned, be deemed to have
continued in existence notwithstanding such application, and the Parent
Guarantor Obligations shall continue to be effective or be reinstated, as the
case may be, as though such application had not been made.
To the fullest extent permitted by applicable law, the obligations of
the Parent Guarantor under this Agreement shall be as aforesaid full,
irrevocable, unconditional and absolute and shall not be impaired, modified,
discharged, released or limited by any occurrence or condition whatsoever,
including, without limitation, (i) any compromise, settlement, release, waiver,
renewal, extension, indulgence or modification of, or any change in, any of the
obligations and liabilities of the Borrower or the Parent Guarantor contained in
any of the Borrower Obligations or this Agreement, (ii) any impairment,
modification, release or limitation of the liability of the Borrower, the Parent
Guarantor or any of their estates in bankruptcy, or any remedy for the
enforcement thereof, resulting from the operation of any present or future
provision of any applicable bankruptcy law, as amended, or other statute or from
the decision of any court, (iii) the assertion or exercise by the Borrower or
the Parent Guarantor of any rights or remedies under any of the Borrower
Obligations or this Agreement or their delay in or failure to assert or exercise
any such rights or remedies, (iv) the assignment or the purported assignment of
any property as security for any of the Borrower Obligations, including all or
any part of the rights of the Borrower or the Parent Guarantor under this
Agreement, (v) the extension of the time for payment by the Borrower or the
Parent Guarantor of any payments or other sums or any part
Exhibit C-1-4
thereof owing or payable under any of the terms and provisions of any of the
Borrower Obligations or this Agreement or of the time for performance by the
Borrower or the Parent Guarantor of any other obligations under or arising out
of any such terms and provisions or the extension or the renewal of any thereof,
(vi) the modification or amendment (whether material or otherwise) of any duty,
agreement or obligation of the Borrower or the Parent Guarantor set forth in
this Agreement, (vii) the voluntary or involuntary liquidation, dissolution,
sale or other disposition of all or substantially all of the assets, marshaling
of assets and liabilities, receivership, insolvency, bankruptcy, assignment for
the benefit of creditors, reorganization, arrangement, composition or
readjustment of, or other similar proceeding affecting, the Borrower or any of
the Parent Guarantor or any of their respective assets, or the disaffirmance of
any of the Borrower Obligations, or this Agreement in any such proceeding,
(viii) the release or discharge of the Borrower or the Parent Guarantor from the
performance or observance of any agreement, covenant, term or condition
contained in any of such instruments by operation of law, (ix) the
unenforceability of any of the Borrower Obligations or this Agreement, (x) any
change in the name, business, capital structure, corporate existence, or
ownership of the Borrower or the Parent Guarantor, or (xi) any other
circumstance which might otherwise constitute a defense available to, or a legal
or equitable discharge of, a surety or the Parent Guarantor.
2.5 Reinstatement. To the maximum extent permitted by applicable law,
the guarantee contained in this Section 2 shall continue to be effective, or be
reinstated, as the case may be, if at any time payment, or any part thereof, of
any of the Borrower Obligations is rescinded or must otherwise be restored or
returned by the Administrative Agent or any Lender upon the insolvency,
bankruptcy, dissolution, liquidation or reorganization of the Borrower or the
Parent Guarantor, or upon or as a result of the appointment of a receiver,
intervenor or conservator of, or trustee or similar officer for, the Borrower or
the Parent Guarantor or any substantial part of its property, or otherwise, all
as though such payments had not been made.
2.6 Payments. The Parent Guarantor hereby guarantees that payments
hereunder will be paid to the Administrative Agent without set-off or
counterclaim and without deduction for any taxes and in immediately available
funds and in Dollars at the Administrative Agent 's payment office at the
address provided in Section 2.16 of the Credit Agreement.
SECTION 3. REPRESENTATIONS AND WARRANTIES
To induce the Administrative Agent and the Lenders to enter into the
Credit Agreement and to induce the Lenders to make their respective extensions
of credit to the Borrower thereunder, the Parent Guarantor hereby represents and
warrants to the Administrative Agent and each Lender that:
3.1 Organization; Powers. The Parent Guarantor is duly formed, validly
existing and in good standing under the laws of the jurisdiction of its
formation, has all requisite power and authority to carry on its business as now
conducted and, except where the failure to do so, individually or in the
aggregate, could not reasonably be expected to result in a Material Adverse
Effect, is qualified to do business in, and is in good standing in, every
jurisdiction where such qualification is required.
Exhibit C-1-5
3.2 Authorization; Enforceability. The execution, delivery and
performance of this Agreement are within the Parent Guarantor's partnership
powers and have been duly authorized by all necessary corporate, limited
liability company or partnership and, if required, limited partner action. This
Agreement has been duly executed and delivered on behalf of the Parent Guarantor
and constitutes a legal, valid and binding obligation of the Parent Guarantor,
enforceable in accordance with its terms, subject to applicable bankruptcy,
insolvency, reorganization, moratorium or other laws affecting creditors' rights
generally and subject to general principles of equity, regardless of whether
considered in a proceeding in equity or at law.
3.3 Government Approvals; No Conflicts. The execution, delivery and
performance of this Agreement (a) do not require any consent or approval of,
registration or filing with, or any other action by, any Governmental Authority,
except such as have been obtained or made and are in full force and effect, (b)
will not violate any applicable law or regulation or the charter, bylaws or
other organizational documents of the Parent Guarantor or any order of any
Governmental Authority; (c) will not violate or result in a default under any
indenture, agreement or other instrument binding upon the Parent Guarantor or
its assets, or give rise to a right thereunder to require any payment to be made
by the Parent Guarantor, and (d) will not result in the creation or imposition
of any Lien on any asset of the Parent Guarantor.
3.4 Investment and Holding Company Status. The Parent Guarantor is not
(a) an "investment company" as defined in, or subject to regulation under, the
Investment Company Act of 1940 or (b) a "holding company" as defined in, or
subject to regulation under, the Public Utility Holding Company Act of 1935.
SECTION 4. INTENTIONALLY OMITTED
SECTION 5. THE ADMINISTRATIVE AGENT
5.1 Authority of Administrative Agent. The Parent Guarantor
acknowledges that the rights and responsibilities of the Administrative Agent
under this Agreement with respect to any action taken by the Administrative
Agent or the exercise or non-exercise by the Administrative Agent of any option,
voting right, request, judgment or other right or remedy provided for herein or
resulting or arising out of this Agreement shall, as between the Administrative
Agent and the Lenders, be governed by the Credit Agreement and by such other
agreements with respect thereto as may exist from time to time among them, but,
as between the Administrative Agent and the Parent Guarantor, the Administrative
Agent shall be conclusively presumed to be acting as agent for the Lenders with
full and valid authority so to act or refrain from acting, and the Parent
Guarantor shall not be under any obligation, or entitlement, to make any inquiry
respecting such authority.
SECTION 6. MISCELLANEOUS
6.1 Amendments in Writing. None of the terms or provisions of this
Agreement may be waived, amended, supplemented or otherwise modified except in
accordance with Section 9.02 of the Credit Agreement.
6.2 Notices. All notices, requests and demands to or upon the
Administrative Agent or the Parent Guarantor hereunder shall be effected in the
manner provided for in Section 9.01 of
Exhibit C-1-6
the Credit Agreement; provided that any such notice, request or demand to or
upon the Parent Guarantor shall be addressed to the Parent Guarantor at its
notice address set forth on Schedule 1.
6.3 No Waiver by Course of Conduct; Cumulative Remedies. Neither the
Administrative Agent nor any Lender shall by any act (except by a written
instrument pursuant to Section 6.1), delay, indulgence, omission or otherwise be
deemed to have waived any right or remedy hereunder or to have acquiesced in any
Default or Event of Default. No failure to exercise, nor any delay in
exercising, on the part of the Administrative Agent or any Lender, any right,
power or privilege hereunder shall operate as a waiver thereof. No single or
partial exercise of any right, power or privilege hereunder shall preclude any
other or further exercise thereof or the exercise of any other right, power or
privilege. A waiver by the Administrative Agent or any Lender of any right or
remedy hereunder on any one occasion shall not be construed as a bar to any
right or remedy which the Administrative Agent or such Lender would otherwise
have on any future occasion. The rights and remedies herein provided are
cumulative, may be exercised singly or concurrently and are not exclusive of any
other rights or remedies provided by law.
6.4 Enforcement Expenses; Indemnification. (a) The Parent Guarantor
agrees to pay or reimburse each Lender and the Administrative Agent for all its
reasonable costs and expenses incurred in collecting against the Parent
Guarantor under the guarantee contained in Section 2 or otherwise enforcing or
preserving any rights under this Agreement and which the Parent Guarantor is a
party, including, without limitation, the reasonable fees and disbursements of
counsel to each Lender and of counsel to the Administrative Agent.
(b) The agreements in this Section 6.4 shall survive repayment of the
Parent Guarantor Obligations and all other amounts payable under the Credit
Agreement and the other Loan Documents.
6.5 Successors and Assigns. This Agreement shall be binding upon the
successors and assigns of the Parent Guarantor and shall inure to the benefit of
the Administrative Agent and the Lenders and their successors and assigns;
provided that the Parent Guarantor may not assign, transfer or delegate any of
its rights or obligations under this Agreement without the prior written consent
of the Administrative Agent.
6.6 Counterparts. This Agreement may be executed by one or more of the
parties to this Agreement on any number of separate counterparts (including by
telecopy), and all of said counterparts taken together shall be deemed to
constitute one and the same instrument. A set of the copies of this Agreement
signed by all the parties shall be lodged with the Borrower and the
Administrative Agent. Delivery of an executed counterpart of a signature page of
this Agreement by telecopy or facsimile shall be effective as delivery of a
manually executed counterpart of this Agreement.
6.7 Severability. Any provision of this Agreement which is prohibited
or unenforceable in any jurisdiction shall, as to such jurisdiction, be
ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions hereof, and any
Exhibit C-1-7
such prohibition or unenforceability in any jurisdiction shall not invalidate or
render unenforceable such provision in any other jurisdiction.
6.8 Integration. This Agreement and the other Loan Documents represent
the entire agreement of the Parent Guarantor, the Administrative Agent and the
Lenders with respect to the subject matter hereof and thereof, and there are no
promises, undertakings, representations or warranties by the Administrative
Agent or any Lender relative to subject matter hereof and thereof not expressly
set forth or referred to herein.
6.9 GOVERNING LAW. THIS AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF THE
PARTIES UNDER THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED AND INTERPRETED
IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK AND TO THE EXTENT
CONTROLLING, LAWS OF THE UNITED STATES OF AMERICA.
6.10 Submission To Jurisdiction; Waivers. The Parent Guarantor hereby
irrevocably and unconditionally:
(a) submits for itself and its property in any legal action or
proceeding relating to this Agreement and the other Loan Documents to which it
is a party, or for recognition and enforcement of any judgment in respect
thereof, to the non-exclusive general jurisdiction of the Supreme Court of New
York, sitting in New York County and of the United States District Court for the
Southern District of New York, and appellate courts from any thereof;
(b) consents that any such action or proceeding may be brought in such
courts and waives, to the fullest extent it may legally and effectively do so,
any objection that it may now or hereafter have to the venue of any such action
or proceeding in any such court or that such action or proceeding was brought in
an inconvenient court and agrees not to plead or claim the same;
(c) agrees that service of process in any such action or proceeding may
be effected by mailing a copy thereof by registered or certified mail (or any
substantially similar form of mail), postage prepaid, to the Parent Guarantor at
its address referred to in Section 6.2 or at such other address of which the
Administrative Agent shall have been notified pursuant thereto; and
(d) agrees that nothing herein shall affect the right to effect service
of process in any other manner permitted by law or shall limit the right to sue
in any other jurisdiction.
(e) waives, to the maximum extent not prohibited by law, any right it
may have to claim or recover in any legal action or proceeding referred to in
this Section 6.10 any special, exemplary, punitive or consequential damages.
6.11 Acknowledgments. The Parent Guarantor hereby acknowledges that:
(a) it has been advised by counsel in the negotiation, execution and
delivery of this Agreement and the other Loan Documents to which it is a party;
(b) neither the Administrative Agent nor any Lender has any fiduciary
relationship with or duty to the Parent Guarantor arising out of or in
connection with this Agreement or the
Exhibit C-1-8
relationship between the Administrative Agent and Lenders, on one hand, and the
Parent Guarantor, on the other hand, in connection herewith or therewith is
solely that of debtor and creditor; and
(c) no joint venture is created hereby or by the other Loan Documents
or otherwise exists by virtue of the transactions contemplated hereby among the
Lenders or among the Parent Guarantor and the Lenders.
6.12 WAIVERS OF JURY TRIAL. THE PARENT GUARANTOR, AND THE
ADMINISTRATIVE AGENT AND THE LENDERS HEREBY IRREVOCABLY AND UNCONDITIONALLY
WAIVE TRIAL BY JURY IN ANY LEGAL ACTION OR PROCEEDING RELATING TO THIS AGREEMENT
OR ANY OTHER LOAN DOCUMENT AND FOR ANY COUNTERCLAIM THEREIN.
6.13 Section Headings. The Section headings used in this Agreement are
for convenience of reference only and are not to affect the construction hereof
or be taken into consideration in the interpretation hereof.
Exhibit C-1-9
IN WITNESS WHEREOF, the undersigned has caused this MLP Guaranty
Agreement to be duly executed and delivered as of the date first above written.
Valero, L.P.
By: Riverwalk Logistics, L.P.
By: Valero GP, LLC, its General Partner
By:
------------------------------------------
Name:
----------------------------------------
Title:
---------------------------------------
Exhibit C-1-10
Schedule 1
NOTICE ADDRESS OF PARENT GUARANTOR
<Table>
<Caption>
Parent Guarantor Address
---------------- -------
Valero, L.P. One Valero Place
San Antonio, Texas 78212
Attention: Senior Vice President
and Chief Financial Officer
Telecopy No.: (210) 592-2010
</Table>
Exhibit C-1-11
================================================================================
EXHIBIT C-2
[FORM OF]
SUBSIDIARY GUARANTY AGREEMENT
MADE BY
[SUBSIDIARIES OF THE BORROWER]
IN FAVOR OF
JPMORGAN CHASE BANK,
AS ADMINISTRATIVE AGENT
DATED AS OF [__________], [200_]
================================================================================
Exhibit C-2
TABLE OF CONTENTS
<Table>
SECTION 1. DEFINED TERMS .....................................................1
1.1 Definitions ......................................................1
1.2 Other Definitional Provisions ....................................2
SECTION 2. GUARANTEE .........................................................3
2.1 Guarantee ........................................................3
2.2 Right of Contribution ............................................4
2.3 No Subrogation ...................................................4
2.4 Amendments, etc. with respect to the Borrower Obligations ........4
2.5 Guarantee Absolute and Unconditional .............................5
2.6 Reinstatement ....................................................7
2.7 Payments .........................................................7
SECTION 3. REPRESENTATIONS AND WARRANTIES ....................................7
3.1 Representations in Credit Agreement ..............................7
SECTION 4. COVENANTS .........................................................7
SECTION 5. THE ADMINISTRATIVE AGENT ..........................................8
5.1 Authority of Administrative Agent ................................8
SECTION 6. MISCELLANEOUS .....................................................8
6.1 Amendments in Writing ............................................8
6.2 Notices ..........................................................8
6.3 No Waiver by Course of Conduct; Cumulative Remedies ..............8
6.4 Enforcement Expenses; Indemnification ............................8
6.5 Successors and Assigns ...........................................9
6.6 Counterparts .....................................................9
6.7 Severability .....................................................9
6.8 Integration ......................................................9
6.9 GOVERNING LAW ....................................................9
6.10 Submission To Jurisdiction; Waivers .............................10
6.11 Acknowledgments .................................................10
6.12 WAIVERS OF JURY TRIAL ...........................................10
6.13 Section Headings ................................................11
6.14 Additional Guarantors ...........................................11
</Table>
Exhibit C-2
SUBSIDIARY GUARANTY AGREEMENT, dated as of [ __________], [200_], made
by each of the signatories hereto (together with any other entity that may
become a party hereto as provided herein, the "Guarantors"), in favor of
JPMorgan Chase Bank, formerly known as The Chase Manhattan Bank, as
Administrative Agent (in such capacity, the "Administrative Agent") for the
benefit of the banks and other financial institutions or entities (the
"Lenders") parties to the Credit Agreement, dated as of December 15, 2000 as
amended and restated through March 6, 2003, (the "Credit Agreement"), among
Valero Logistics Operations, L.P., a Delaware limited partnership formerly known
as Shamrock Logistics Operations, L.P. (the "Borrower"), the Lenders, the
Administrative Agent, Royal Bank of Canada, as syndication agent and SunTrust
Bank, as documentation agent.
WITNESSETH:
WHEREAS, pursuant to the Credit Agreement, the Lenders have severally
agreed to make extensions of credit to the Borrower upon the terms and subject
to the conditions set forth therein;
WHEREAS, the Borrower is a member of an affiliated group of companies
that includes each Guarantor;
WHEREAS, the proceeds of the extensions of credit under the Credit
Agreement may be or have been used in part to enable the Borrower to make
valuable transfers to one or more of the Guarantors in connection with the
operation of their respective businesses;
WHEREAS, the Borrower and the Guarantors are engaged in related
businesses, and each Guarantor will derive substantial direct and indirect
benefit from the making of the extensions of credit under the Credit Agreement;
and
WHEREAS, it is a condition subsequent to the obligation of the Lenders
to make their respective extensions of credit to the Borrower under the Credit
Agreement that the Guarantors, when and as created or acquired by the Borrower,
shall execute and deliver this Agreement to the Administrative Agent for the
ratable benefit of the Lenders;
NOW, THEREFORE, in consideration of the premises and to induce the
Lenders to continue their respective extensions of credit to the Borrower under
the Credit Agreement, each Guarantor hereby agrees with the Administrative
Agent, for the ratable benefit of the Lenders, as follows:
SECTION 1. DEFINED TERMS
1.1 Definitions. (a) Unless otherwise defined herein, terms defined in
the Credit Agreement and used herein shall have the meanings given to them in
the Credit Agreement.
(b) The following terms shall have the following meanings:
"Agreement": means this Subsidiary Guaranty Agreement, as the same may
be amended, supplemented or otherwise modified from time to time.
Exhibit C-2-1
"Borrower Obligations": means the collective reference to all
Indebtedness owing by the Borrower pursuant to the Credit Agreement, including,
without limitation, the unpaid principal of and interest on the Loans and LC
Disbursements and all other obligations and liabilities of the Borrower
(including, without limitation, interest accruing at the then applicable rate
provided in the Credit Agreement after the maturity of the Loans and LC
Disbursements and interest accruing at the then applicable rate provided in the
Credit Agreement after the filing of any petition in bankruptcy, or the
commencement of any insolvency, reorganization or like proceeding, relating to
the Borrower, whether or not a claim for post-filing or post-petition interest
is allowed in such proceeding) to the Administrative Agent or any Lender (or, in
the case of any Hedging Agreement referred to below, any Affiliate of a Lender),
whether direct or indirect, absolute or contingent, due or to become due, or now
existing or hereafter incurred, which may arise under, out of, or in connection
with, the Credit Agreement, this Agreement, any Letter of Credit, any Hedging
Agreement entered into by the Borrower with any Lender (or any Affiliate of a
Lender) or the other Loan Documents or any other document made, delivered or
given in connection therewith, in each case whether on account of principal,
interest, reimbursement obligations, fees, indemnities, costs, expenses or
otherwise (including, without limitation, all fees and disbursements of counsel
to the Administrative Agent or to the Lenders that are required to be paid by
the Borrower pursuant to the terms of any of the foregoing agreements).
"Guarantor Obligations": means with respect to any Guarantor, the
collective reference to (i) the Borrower Obligations and (ii) all obligations
and liabilities of such Guarantor which may arise under or in connection with
this Agreement, in each case whether on account of guarantee obligations,
reimbursement obligations, loan obligations, fees, indemnities, costs, expenses
or otherwise (including, without limitation, all fees and disbursements of
counsel to the Administrative Agent or to the Lenders that are required to be
paid by such Guarantor pursuant to the terms of this Agreement or any other Loan
Document).
"Guarantors": means the collective reference to each Guarantor party to
this Agreement.
"Obligations": means in the case of each Guarantor, its Guarantor
Obligations.
"Solvent": means with respect to each Guarantor as of any date, that
(a) the value of the assets of such Guarantor (both at fair value and present
fair saleable value) is, on the date of determination, greater than the total
amount of liabilities (including contingent and unliquidated liabilities) of
such Guarantor as of such date, (b) as of such date, such Guarantor is able to
pay all of its liabilities as such liabilities mature and (c) as of such date,
such Guarantor does not have unreasonably small capital given the nature of its
business. In computing the amount of contingent or unliquidated liabilities at
any time, such liabilities shall be computed at the amount that, in light of all
the facts and circumstances existing at such time, represents the amount that
can reasonably be expected to become an actual or matured liability.
1.2 Other Definitional Provisions. (a) The words "hereof," "herein",
"hereto" 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 Section and Schedule references are to this Agreement unless
otherwise specified.
Exhibit C-2-2
(b) The meanings given to terms defined herein shall be equally
applicable to both the singular and plural forms of such terms.
(c) A reference to any Person hereunder shall be deemed to include a
reference to such Person's successor's, endorsees, transferees and assigns.
SECTION 2. GUARANTEE
2.1 Guarantee. (a) Each of the Guarantors hereby, jointly and
severally, (i) absolutely, unconditionally and irrevocably, guarantees to the
Administrative Agent for the ratable benefit of the Lenders and their respective
successors, endorsees, transferees and assigns, the prompt and complete payment
and performance by the Borrower when due (whether at the stated maturity, by
acceleration or otherwise) of the Borrower Obligations and (ii) indemnifies and
holds harmless the Administrative Agent and each Lender from, and agrees to pay
to the Administrative Agent and each Lender, all reasonable costs and expenses
(including reasonable counsel fees and expenses) incurred by the Administrative
Agent or such Lender in enforcing any of its rights under this Agreement. The
guarantee in this Section 2.1 is a continuing guarantee, and shall apply to all
Obligations owing at any time whenever arising or incurred and shall remain in
full force and effect until the Obligations have been indefeasibly paid in full.
Each Guarantor agrees that notwithstanding any stay, injunction or other
prohibition preventing the payment by the Borrower of all or any portion of the
Borrower Obligations and notwithstanding that all or any portion of the Borrower
Obligations may be unenforceable or not allowable due to the existence of a
bankruptcy, reorganization or similar proceeding involving the Borrower, such
Borrower Obligations shall nevertheless be due and payable by such Guarantor for
the purposes of this Agreement at the time such Borrower Obligations would by
payable by the Borrower under the provisions of the Credit Agreement.
Notwithstanding the foregoing, any enforcement of this Agreement with respect to
the rights of any Lender may be accomplished by the Administrative Agent acting
on behalf of such Lender.
(b) Anything herein or in any other Loan Document to the contrary
notwithstanding, the maximum liability of each Guarantor hereunder shall in no
event exceed the amount which can be guaranteed by such Guarantor under
applicable federal and state laws relating to the insolvency of debtors (after
giving effect to the right of contribution established in Section 2.2).
(c) Each Guarantor agrees that the Borrower Obligations may at any time
and from time to time exceed the amount of the liability of such Guarantor
hereunder without impairing the guarantee contained in this Section 2 or
affecting the rights and remedies of the Administrative Agent or any Lender
hereunder.
(d) The guarantee contained in this Section 2.1 shall remain in full
force and effect until all the Borrower Obligations and the obligations of each
Guarantor under the guarantee contained in this Section 2.1 shall have been
satisfied by payment in full, no Letter of Credit shall be outstanding and the
Commitments shall be terminated, notwithstanding that from time to time during
the term of the Credit Agreement the Borrower may be free from any Borrower
Obligations.
Exhibit C-2-3
(e) No payment made by the Borrower, any of the Guarantors, any other
guarantor or any other Person or received or collected by the Administrative
Agent or any Lender from the Borrower, any of the Guarantors, any other
guarantor or any other Person by virtue of any action or proceeding or any
set-off or appropriation or application at any time or from time to time in
reduction of or in payment of the Borrower Obligations shall be deemed to
modify, reduce, release or otherwise affect the liability of any Guarantor
hereunder which shall, notwithstanding any such payment (other than any payment
made by such Guarantor in respect of the Borrower Obligations or any payment
received or collected from such Guarantor in respect of the Borrower
Obligations), remain liable for the Borrower Obligations up to the maximum
liability of such Guarantor hereunder until, subject to Section 2.6, the
Borrower Obligations are paid in full, no Letter of Credit shall be outstanding
and the Commitments are terminated.
2.2 Right of Contribution. Each Guarantor hereby agrees that to the
extent that a Guarantor shall have paid more than its proportionate share of any
payment made hereunder, such Guarantor shall be entitled to seek and receive
contribution from and against any other Guarantor hereunder which has not paid
its proportionate share of such payment. Each Guarantor's right of contribution
shall be subject to the terms and conditions of Section 2.3. The provisions of
this Section 2.2 shall in no respect limit the obligations and liabilities of
any Guarantor to the Administrative Agent and the Lenders, and each Guarantor
shall remain liable to the Administrative Agent and the Lenders for the full
amount guaranteed by such Guarantor hereunder.
2.3 No Subrogation. Notwithstanding any payment made by any Guarantor
hereunder or any set-off or application of funds of any Guarantor by the
Administrative Agent or any Lender, no Guarantor shall be entitled to be
subrogated to any of the rights of the Administrative Agent or any Lender
against the Borrower or any other Guarantor or any collateral security or
guarantee or right of offset held by the Administrative Agent or any Lender for
the payment of the Borrower Obligations, nor shall any Guarantor seek or be
entitled to seek any contribution or reimbursement from the Borrower or any
other Guarantor in respect of payments made by such Guarantor hereunder, until
all amounts owing to the Administrative Agent and the Lenders by the Borrower on
account of the Borrower Obligations are indefeasibly paid in full, no Letter of
Credit shall be outstanding and the Commitments are terminated. If any amount
shall be paid to any Guarantor on account of such subrogation rights at any time
when all of the Borrower Obligations shall not have been paid in full, such
amount shall be held by such Guarantor in trust for the Administrative Agent and
the Lenders, segregated from other funds of such Guarantor, and shall, forthwith
upon receipt by such Guarantor, be turned over to the Administrative Agent in
the exact form received by such Guarantor (duly indorsed by such Guarantor to
the Administrative Agent, if required), to be applied against the Borrower
Obligations, whether matured or unmatured, in such order as the Administrative
Agent may determine.
2.4 Amendments, etc. with respect to the Borrower Obligations. Each
Guarantor shall remain obligated hereunder notwithstanding that, without any
reservation of rights against any Guarantor and without notice to or further
assent by any Guarantor, any demand for payment of any of the Borrower
Obligations made by the Administrative Agent or any Lender may be rescinded by
the Administrative Agent or such Lender and any of the Borrower Obligations
continued, and the Borrower Obligations, or the liability of any other Person
upon or for any part
Exhibit C-2-4
thereof, or any collateral security or guarantee therefor or right of offset
with respect thereto, may, from time to time, in whole or in part, be renewed,
extended, amended, modified, accelerated, compromised, waived, surrendered or
released by the Administrative Agent or any Lender, and the Credit Agreement and
the other Loan Documents and any other documents executed and delivered in
connection therewith may be amended, modified, supplemented or terminated, in
whole or in part, as the Administrative Agent (or the Required Lenders or all
Lenders, as the case may be) may deem advisable from time to time, and any
collateral security, guarantee or right of offset at any time held by the
Administrative Agent or any Lender for the payment of the Borrower Obligations
may be sold, exchanged, waived, surrendered or released. Neither the
Administrative Agent nor any Lender shall have any obligation to protect,
secure, perfect or insure any Lien at any time held by it as security for the
Borrower Obligations or for the guarantee contained in this Section 2 or any
property subject thereto.
2.5 Guarantee Absolute and Unconditional. Each Guarantor waives any and
all notice of the creation, renewal, extension or accrual of any of the Borrower
Obligations and notice of or proof of reliance by the Administrative Agent or
any Lender upon the guarantee contained in this Section 2 or acceptance of the
guarantee contained in this Section 2; the Borrower Obligations, and any of
them, shall conclusively be deemed to have been created, contracted or incurred,
or renewed, extended, amended or waived, in reliance upon the guarantee
contained in this Section 2; and all dealings between the Borrower and any of
the Guarantors, on the one hand, and the Administrative Agent and the Lenders,
on the other hand, likewise shall be conclusively presumed to have been had or
consummated in reliance upon the guarantee contained in this Section 2. Each
Guarantor waives diligence, presentment, protest, demand for payment and notice
of default or nonpayment to or upon the Borrower or any of the Guarantors with
respect to the Borrower Obligations. Each Guarantor understands and agrees that
the guarantee contained in this Section 2 shall be construed as a continuing,
absolute and unconditional guarantee of payment without regard to (a) the
validity or enforceability of the Credit Agreement or any other Loan Document,
any of the Borrower Obligations or any other collateral security therefor or
guarantee or right of offset with respect thereto at any time or from time to
time held by the Administrative Agent or any Lender, (b) any defense, set-off or
counterclaim (other than a defense of payment or performance) which may at any
time be available to or be asserted by the Borrower or any other Person against
the Administrative Agent or any Lender, (c) any extension, other indulgence,
renewal, settlement, discharge, compromise, waiver, subordination or release in
respect of any Borrower Obligation, security, Person or otherwise, (d) any
modification or amendment of or supplement to the Borrower Obligations,
including any increase or decrease in the principal, the rates of interest or
other amounts payable thereunder, (e) any release, non-perfection or invalidity
of any direct or indirect security for any Borrower Obligation, (f) any change
in the existence, structure, constitution, name, objects, powers, business,
control or ownership of the Borrower or any other Person, or any insolvency,
bankruptcy, reorganization or other similar proceeding affecting the Borrower or
any other Person or its assets, (g) any limitation, postponement, prohibition,
subordination or other restriction on the rights of the Administrative Agent or
the Lenders to payment of the Borrower Obligations, (h) any release,
substitution or addition of any cosigner, endorser or other guarantor of the
Borrower Obligations, (i) any defense arising by reason of any failure of the
Borrower to make any presentment, demand for performance, notice of
non-performance, protest, and any other notice, including notice of all of the
following: acceptance of this Agreement, partial payment or non-payment of all
or any part of the Borrower Obligations and the existence,
Exhibit C-2-5
creation, or incurring of new or additional Borrower Obligations, (j) any
defense arising by reason of any failure of the Administrative Agent to proceed
against the Borrower or any other Person, to proceed against, apply or exhaust
any security held from the Borrower or any other Person for the Borrower
Obligations, to proceed against, apply or exhaust any security held from any
Guarantor or any other Person for this Agreement or to pursue any other remedy
in the power of the Administrative Agent or the Lenders whatsoever, (k) any law
which provides that the obligation of a guarantor must neither be larger in
amount nor in other respects more burdensome than that of the principal
obligation or which reduces a guarantor's obligation in proportion to the
principal obligation, (l) any defense arising by reason of any incapacity, lack
of authority, or other defense of the Borrower or any other Person, or by reason
of any limitation, postponement, prohibition on the Administrative Agent's or
the Lenders' right to payment of the Borrower Obligations or any part thereof,
or by reason of the cessation from any cause whatsoever of the liability of the
Borrower or any other Person with respect to all or any part of the Borrower
Obligations, or by reason of any act or omission of the Administrative Agent or
the Lenders which directly or indirectly results in the discharge or release of
the Borrower or any other Person of all or any part of the Borrower Obligations
or any security or guarantee therefore, whether by contract, operation of law or
otherwise, (m) any defense arising by failure by the Administrative Agent or the
Lenders to obtain, perfect or maintain a perfected or prior (or any) security
interest in or lien or encumbrance upon any property of the Borrower or any
other Person, or by reason of any interest of the Borrower in any property,
whether as owner thereof or the holder of a security interest therein or lien or
encumbrance thereon, being invalidated, voided, declared fraudulent or
preferential or otherwise set aside, or by reason of any impairment by the
Borrower of any right to recourse or collateral, (n) any defense arising by
reason of the failure of the Borrower to marshal any assets, (o) any defense
based upon any failure of the Administrative Agent or any Lender to give to the
Borrower or any Guarantor notice of any sale or other disposition of any
property securing any or all of the Obligations, or any defect in any notice
that may be given in connection with any sale or other disposition of any such
property, or any failure of the Administrative Agent or any Lender to comply
with any provision of applicable law in enforcing any security interest in or
lien upon any such property, including any failure of the Administrative Agent
or any Lender to dispose of any such property in a commercially reasonable
manner, (p) any dealing whatsoever with the Borrower or other Person or any
security, whether negligently or not, or any failure to do so, (q) any defense
based upon or arising out any bankruptcy, insolvency, reorganization,
moratorium, arrangement, readjustment of debt, liquidation or dissolution
proceeding commenced by or against the Borrower or any other Person, including
any discharge of, or bar against collecting, any of the Borrower Obligations, in
or as a result of any such proceeding, (r) or any other act or omission to act
or delay of any kind by the Borrower, the Administrative Agent, any Lender, any
Guarantor or any other Person or any other circumstance whatsoever, whether
similar or dissimilar to the foregoing, which might, but for the provisions of
this Section 2.5, constitute a legal or equitable discharge, limitation or
reduction of such Guarantor's obligations hereunder (other than the payment in
full of all of the Borrower Obligations). The foregoing provisions apply (and
the foregoing waivers will be effective) even if the effect of any action (or
failure to take any action) by the Administrative Agent or any Lender is to
destroy or diminish a Guarantor's subrogation rights, such Guarantor's right to
proceed against the Borrower for reimbursement, such Guarantor's right to
recover contribution from any other Guarantor or any other right or remedy. When
making any demand hereunder or otherwise pursuing its rights and remedies
hereunder
Exhibit C-2-6
against any Guarantor, the Administrative Agent or any Lender may, but shall be
under no obligation to, make a similar demand on or otherwise pursue such rights
and remedies as it may have against the Borrower, any other Guarantor or any
other Person or against any collateral security or guarantee for the Borrower
Obligations or any right of offset with respect thereto, and any failure by the
Administrative Agent or any Lender to make any such demand, to pursue such other
rights or remedies or to collect any payments from the Borrower, any other
Guarantor or any other Person or to realize upon any such collateral security or
guarantee or to exercise any such right of offset, or any release of the
Borrower, any other Guarantor or any other Person or any such collateral
security, guarantee or right of offset, shall not relieve any Guarantor of any
obligation or liability hereunder, and shall not impair or affect the rights and
remedies, whether express, implied or available as a matter of law, of the
Administrative Agent or any Lender against any Guarantor. For the purposes
hereof "demand" shall include the commencement and continuance of any legal
proceedings.
2.6 Reinstatement. The guarantee contained in this Section 2 shall
continue to be effective, or be reinstated, as the case may be, if at any time
payment, or any part thereof, of any of the Borrower Obligations is rescinded or
must otherwise be restored or returned by the Administrative Agent or any Lender
upon the insolvency, bankruptcy, dissolution, liquidation or reorganization of
the Borrower or any Guarantor, or upon or as a result of the appointment of a
receiver, intervenor or conservator of, or trustee or similar officer for, the
Borrower or any Guarantor or any substantial part of its property, or otherwise,
all as though such payments had not been made.
2.7 Payments. Each Guarantor hereby guarantees that payments hereunder
will be paid to the Administrative Agent without set-off or counterclaim and
without deduction for any taxes and in immediately available funds and in
Dollars at the Administrative Agent 's payment office at the address provided in
Section 2.16 of the Credit Agreement.
SECTION 3. REPRESENTATIONS AND WARRANTIES
To induce the Administrative Agent and the Lenders to enter into the
Credit Agreement and to induce the Lenders to make their respective extensions
of credit to the Borrower thereunder, each Guarantor hereby represents and
warrants to the Administrative Agent and each Lender that:
3.1 Representations in Credit Agreement. In the case of each Guarantor,
the representations and warranties set forth in Article 3 of the Credit
Agreement as they relate to such Guarantor or to which such Guarantor is a
party, each of which is hereby incorporated herein by reference, are true and
correct, and the Administrative Agent and each Lender shall be entitled to rely
on each of them as if they were fully set forth herein. Each Guarantor also
represents and warrants that it is Solvent.
SECTION 4. COVENANTS
Each Guarantor covenants and agrees with the Administrative Agent and
the Lenders that, from and after the date of this Agreement until the
Obligations shall have been paid in full, no Letter of Credit shall be
outstanding and the Commitments shall have terminated, in the case
Exhibit C-2-7
of each Guarantor, such Guarantor shall take, or shall refrain from taking, as
the case may be, each action that is necessary to be taken or not taken, as the
case may be, so that no Default or Event of Default is caused by the failure to
take such action or to refrain from taking such action by such Guarantor or any
of its Subsidiaries.
SECTION 5. THE ADMINISTRATIVE AGENT
5.1 Authority of Administrative Agent. Each Guarantor acknowledges that
the rights and responsibilities of the Administrative Agent under this Agreement
with respect to any action taken by the Administrative Agent or the exercise or
non-exercise by the Administrative Agent of any option, voting right, request,
judgment or other right or remedy provided for herein or resulting or arising
out of this Agreement shall, as between the Administrative Agent and the
Lenders, be governed by the Credit Agreement and by such other agreements with
respect thereto as may exist from time to time among them, but, as between the
Administrative Agent and the Guarantors, the Administrative Agent shall be
conclusively presumed to be acting as agent for the Lenders with full and valid
authority so to act or refrain from acting, and no Guarantor shall be under any
obligation, or entitlement, to make any inquiry respecting such authority.
SECTION 6. MISCELLANEOUS
6.1 Amendments in Writing. None of the terms or provisions of this
Agreement may be waived, amended, supplemented or otherwise modified except in
accordance with Section 9.02 of the Credit Agreement.
6.2 Notices. All notices, requests and demands to or upon the
Administrative Agent or any Guarantor hereunder shall be effected in the manner
provided for in Section 9.01 of the Credit Agreement; provided that any such
notice, request or demand to or upon any Guarantor shall be addressed to such
Guarantor at its notice address set forth on Schedule 1.
6.3 No Waiver by Course of Conduct; Cumulative Remedies. Neither the
Administrative Agent nor any Lender shall by any act (except by a written
instrument pursuant to Section 6.1), delay, indulgence, omission or otherwise be
deemed to have waived any right or remedy hereunder or to have acquiesced in any
Default or Event of Default. No failure to exercise, nor any delay in
exercising, on the part of the Administrative Agent or any Lender, any right,
power or privilege hereunder shall operate as a waiver thereof. No single or
partial exercise of any right, power or privilege hereunder shall preclude any
other or further exercise thereof or the exercise of any other right, power or
privilege. A waiver by the Administrative Agent or any Lender of any right or
remedy hereunder on any one occasion shall not be construed as a bar to any
right or remedy which the Administrative Agent or such Lender would otherwise
have on any future occasion. The rights and remedies herein provided are
cumulative, may be exercised singly or concurrently and are not exclusive of any
other rights or remedies provided by law.
6.4 Enforcement Expenses; Indemnification. (a) Each Guarantor agrees to
pay or reimburse each Lender and the Administrative Agent for all its costs and
expenses incurred in collecting against such Guarantor under the guarantee
contained in Section 2 or otherwise
Exhibit C-2-8
enforcing or preserving any rights under this Agreement and which such Guarantor
is a party, including, without limitation, the reasonable fees and disbursements
of counsel (including the allocated fees and expenses of in-house counsel) to
each Lender and of counsel to the Administrative Agent.
(b) Each Guarantor agrees to pay, and to save the Administrative Agent
and the Lenders harmless from, any and all liabilities, obligations, losses,
damages, penalties, actions, judgments, suits, costs, expenses or disbursements
of any kind or nature whatsoever with respect to the execution, delivery,
enforcement, performance and administration of this Agreement to the same extent
the Borrower would be required to do so pursuant to Section 9.03 of the Credit
Agreement.
(c) The agreements in this Section 6.4 shall survive repayment of the
Obligations and all other amounts payable under the Credit Agreement and the
other Loan Documents.
6.5 Successors and Assigns. This Agreement shall be binding upon the
successors and assigns of each Guarantor and shall inure to the benefit of the
Administrative Agent and the Lenders and their successors and assigns; provided
that no Guarantor may assign, transfer or delegate any of its rights or
obligations under this Agreement without the prior written consent of the
Administrative Agent.
6.6 Counterparts. This Agreement may be executed by one or more of the
parties to this Agreement on any number of separate counterparts (including by
telecopy), and all of said counterparts taken together shall be deemed to
constitute one and the same instrument. A set of the copies of this Agreement
signed by all the parties shall be lodged with the Borrower and the
Administrative Agent. Delivery of an executed counterpart of a signature page of
this Agreement by telecopy or facsimile shall be effective as delivery of a
manually executed counterpart of this Agreement.
6.7 Severability. Any provision of this Agreement which is prohibited
or unenforceable in any jurisdiction shall, as to such jurisdiction, be
ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions hereof, and any such prohibition or
unenforceability in any jurisdiction shall not invalidate or render
unenforceable such provision in any other jurisdiction.
6.8 Integration. This Agreement and the other Loan Documents represent
the entire agreement of the Guarantors, the Administrative Agent and the Lenders
with respect to the subject matter hereof and thereof, and there are no
promises, undertakings, representations or warranties by the Administrative
Agent or any Lender relative to subject matter hereof and thereof not expressly
set forth or referred to herein.
6.9 GOVERNING LAW. THIS AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF THE
PARTIES UNDER THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED AND INTERPRETED
IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK AND TO THE EXTENT
CONTROLLING, LAWS OF THE UNITED STATES OF AMERICA.
Exhibit C-2-9
6.10 Submission To Jurisdiction; Waivers. Each Guarantor hereby
irrevocably and unconditionally:
(a) submits for itself and its property in any legal action or
proceeding relating to this Agreement and the other Loan Documents to which it
is a party, or for recognition and enforcement of any judgment in respect
thereof, to the non-exclusive general jurisdiction of the Courts of the State of
New York, the courts of the United States of America for the Southern District
of New York, and appellate courts from any thereof;
(b) consents that any such action or proceeding may be brought in such
courts and waives any objection that it may now or hereafter have to the venue
of any such action or proceeding in any such court or that such action or
proceeding was brought in an inconvenient court and agrees not to plead or claim
the same;
(c) agrees that service of process in any such action or proceeding may
be effected by mailing a copy thereof by registered or certified mail (or any
substantially similar form of mail), postage prepaid, to such Guarantor at its
address referred to in Section 6.2 or at such other address of which the
Administrative Agent shall have been notified pursuant thereto;
(d) agrees that nothing herein shall affect the right to effect service
of process in any other manner permitted by law or shall limit the right to sue
in any other jurisdiction; and
(e) waives, to the maximum extent not prohibited by law, any right it
may have to claim or recover in any legal action or proceeding referred to in
this Section 6.10 any special, exemplary, punitive or consequential damages.
6.11 Acknowledgments. Each Guarantor hereby acknowledges that:
(a) it has been advised by counsel in the negotiation, execution and
delivery of this Agreement and the other Loan Documents to which it is a party;
neither the Administrative Agent nor any Lender has any fiduciary relationship
with or duty to any Guarantor arising out of or in connection with this
Agreement or the relationship between the Administrative Agent and Lenders, on
one hand, and the Guarantors, on the other hand, in connection herewith or
therewith is solely that of debtor and creditor; and
(b) no joint venture is created hereby or by the other Loan Documents
or otherwise exists by virtue of the transactions contemplated hereby among the
Lenders or among the Guarantors and the Lenders.
6.12 WAIVERS OF JURY TRIAL. EACH GUARANTOR, AND THE ADMINISTRATIVE
AGENT AND THE LENDERS HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVE TRIAL BY JURY
IN ANY LEGAL ACTION OR PROCEEDING RELATING TO THIS AGREEMENT OR ANY OTHER LOAN
DOCUMENT AND FOR ANY COUNTERCLAIM THEREIN.
Exhibit C-2-10
6.13 Section Headings. The Section headings used in this Agreement are
for convenience of reference only and are not to affect the construction hereof
or be taken into consideration in the interpretation hereof.
6.14 Additional Guarantors. Each Subsidiary of the Borrower that is
required to become a party to this Agreement pursuant to Section 5.11 of the
Credit Agreement shall become a Guarantor for all purposes of this Agreement
upon execution and delivery by such Subsidiary of an Assumption Agreement in the
form of Annex I hereto.
Exhibit C-2-11
IN WITNESS WHEREOF, each of the undersigned has caused this Subsidiary Guaranty
Agreement to be duly executed and delivered as of the date first above written.
Guarantor
By: [ ]
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Title:
[Guarantor]
By: [ ]
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Title:
Exhibit C-2-12
Schedule 1
NOTICE ADDRESSES OF GUARANTORS
Guarantors Address
Exhibit C-2-13
ACKNOWLEDGMENT AND CONSENT
The undersigned hereby acknowledges receipt of a copy of the Subsidiary
Guaranty Agreement dated as of [__________], [200_], (the "Subsidiary Guaranty
Agreement"), made by the Guarantors parties thereto for the benefit of JPMorgan
Chase Bank, formerly known as The Chase Manhattan Bank, as Administrative Agent.
The undersigned agrees for the benefit of the Administrative Agent and the
Lenders the undersigned will be bound by the terms of the Subsidiary Guaranty
Agreement and will comply with such terms insofar as such terms are applicable
to the undersigned.
[ ]
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By: [ ]
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Title:
Address for Notices:
Exhibit C-2-14
Annex 1 to
Subsidiary Guaranty Agreement
ASSUMPTION AGREEMENT, dated as of [________________], [200_], by
[_________________________________________], a [______________________]
corporation (the "Additional Guarantor"), in favor of JPMorgan Chase Bank,
formerly known as The Chase Manhattan Bank, as Administrative Agent (in such
capacity, the "Administrative Agent ") for the banks and other financial
institutions (the "Lenders") parties to the Credit Agreement referred to below.
All capitalized terms not defined herein shall have the meaning ascribed to them
in such Credit Agreement.
WITNESSETH:
WHEREAS, Valero Logistics Operations, L.P., (the "Borrower"), the
Lenders and the Administrative Agent have entered into a Credit Agreement, dated
as of December 15, 2000 as amended and restated through March 6, 2003, (the
"Credit Agreement");
WHEREAS, in connection with the Credit Agreement, the Borrower and
certain of its affiliates (other than the Additional Guarantor) have entered
into the Subsidiary Guaranty Agreement, dated as of [_________], [200_] (as
amended, supplemented or otherwise modified from time to time, the "Subsidiary
Guaranty Agreement") in favor of the Administrative Agent for the benefit of the
Lenders:
WHEREAS, the Credit Agreement requires the Additional Guarantor to
become a party to the Subsidiary Guaranty Agreement; and
WHEREAS, the Additional Guarantor has agreed to execute and deliver
this Assumption Agreement in order to become a party to the Subsidiary Guaranty
Agreement;
NOW, THEREFORE, IT IS AGREED:
1. Subsidiary Guaranty Agreement. By executing and delivering this
Assumption Agreement, the Additional Guarantor, as provided in Section
6.14 of the Subsidiary Guaranty Agreement, hereby becomes a party to
the Subsidiary Guaranty Agreement as a Guarantor thereunder with the
same force and effect as if originally named therein as a Guarantor
and, without limiting the generality of the foregoing, hereby expressly
assumes all obligations and liabilities of a Guarantor thereunder. The
information set forth in Annex l-A hereto is hereby added to the
information set forth in Schedule 1 to the Subsidiary Guaranty
Agreement. The Additional Guarantor hereby represents and warrants that
each of the representations and warranties contained in Section 3 of
the Subsidiary Guaranty Agreement is true and correct on and as the
date hereof (after giving effect to this Assumption Agreement) as if
made on and as of such date.
2. GOVERNING LAW. THIS AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF THE
PARTIES UNDER THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED AND
INTERPRETED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK
Exhibit C-2-15
AND TO THE EXTENT CONTROLLING, LAWS OF THE UNITED STATES OF AMERICA.
Exhibit C-2-16
IN WITNESS WHEREOF, the undersigned has caused this Assumption Agreement to be
duly executed and delivered as of the date first above written.
[ADDITIONAL GUARANTOR]
By: [ ]
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Name:
Title:
Exhibit C-2-17
EXHIBIT D-1
FORM OF INITIAL NOTICE OF COMMITMENT INCREASE
[Date]
JPMorgan Chase Bank,
as Administrative Agent
1111 Fannin, 8th Floor
Houston, TX 77002
Attention: __________________
Ladies and Gentlemen:
The undersigned, Valero Logistics Operations, L.P., refers to the
Credit Agreement dated as of December 15, 2000, as amended and restated through
March 6, 2003 (as amended, supplemented or otherwise modified from time to time,
the "Credit Agreement", with terms defined in the Credit Agreement and not
otherwise defined herein being used herein as therein defined) among Valero
Logistics Operations, L.P., a Delaware limited partnership (the "Borrower"), the
Lenders party thereto, JPMorgan Chase Bank, as Administrative Agent, Royal Bank
of Canada, as Syndication Agent and SunTrust Bank and Mizuho Corporate Bank
Ltd., as Co-Documentation Agents and hereby gives you notice, pursuant to
Section 2.18 of the Credit Agreement that the undersigned hereby requests that
(x) the Lenders agree to increase their respective Commitments and/or (y) the
New Lenders agree to provide Commitments under the Credit Agreement, and in that
connection sets forth below the information relating to such proposed Commitment
increase as required by Section 2.18 of the Credit Agreement:
(i) the effective date of such increase of aggregate amount of
the Lenders' Commitments is _______________; and
(ii) the amount of the requested increase (and/or provision,
as applicable) of the aggregate Lenders' Commitments is
$________________ [$10,000,000 minimum];
Exhibit D-1-1
Delivery of an executed counterpart of this Initial Notice of
Commitment Increase by telecopier shall be effective as delivery of an original
executed counterpart of this Initial Notice of Commitment Increase.
Very truly yours,
VALERO LOGISTICS OPERATIONS, L.P.
By: Valero GP, Inc., its General Partner
By:
----------------------------------------
Name: Steven A. Blank
Title: Senior Vice President and Chief
Financial Officer
Exhibit D-1-2
EXHIBIT D-2
FORM OF NOTICE OF CONFIRMATION OF COMMITMENT INCREASE
[Date]
JPMorgan Chase Bank,
as Administrative Agent
1111 Fannin, 8th Floor
Houston, TX 77002
Attention: __________________
Ladies and Gentlemen:
The undersigned, Valero Logistics Operations, L.P., refers to the
Credit Agreement dated as of December 15, 2000, as amended and restated through
March 6, 2003 (as amended, supplemented or otherwise modified from time to time,
the "Credit Agreement", with terms defined in the Credit Agreement and not
otherwise defined herein being used herein as therein defined) among Valero
Logistics Operations, L.P., a Delaware limited partnership (the "Borrower"), the
Lenders party thereto, JPMorgan Chase Bank, as Administrative Agent, Royal Bank
of Canada, as Syndication Agent and SunTrust Bank and Mizuho Corporate Bank
Ltd., as Co-Documentation Agents and hereby gives you notice, irrevocably,
pursuant to Section 2.18 of the Credit Agreement that the undersigned hereby
requests that (x) the Lenders agree to increase their respective Commitments
and/or (y) the New Lenders agree to provide Commitments under the Credit
Agreement, and in that connection sets forth below the information relating to
such proposed Commitment increase as required by Section 2.18 of the Credit
Agreement:
(i) the effective date of such increase of aggregate amount of
the Lenders' Commitments is _________________;
(ii) the amount of the requested increase (and/or provision,
as applicable) of the aggregate Lenders' Commitments is________________
[$10,000,000 minimum];
(iii) the Increasing Lenders, the Partially Increasing Lenders
or the New Lenders, if any, which have agreed with the Borrower to
increase (and/or provide, as applicable) their respective Commitments
or to provide Commitments, as the case may be, are: [INSERT NAMES OF
THE INCREASING LENDERS, THE PARTIALLY INCREASING LENDERS AND/OR NEW
LENDERS];
(iv) the Reducing Lenders, if any, which have not agreed to
increase their respective Commitments are: [INSERT THE NAMES OF THE
REDUCING LENDERS]; and
(v) set forth on Schedule I hereto is the amount of the
respective Commitments of all Increasing Lenders, Partially Increasing
Lenders, Reducing Lenders and New Lenders after the effective date of
such increase.
Exhibit D-1-3
Delivery of an executed counterpart of this Notice of Confirmation of
Commitment Increase by telecopier shall be effective as delivery of an original
executed counterpart of this Notice of Confirmation of Commitment Increase.
Very truly yours,
VALERO LOGISTICS OPERATIONS, L.P.
By: Valero GP, Inc., its General Partner
By:
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Name: Steven A. Blank
Title: Senior Vice President and Chief
Financial Officer
Exhibit D-1-4