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Exhibit 10.3
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U.S. $750,000,000
FIVE-YEAR COMPETITIVE ADVANCE/REVOLVING CREDIT AGREEMENT
Among
UNION PACIFIC RESOURCES GROUP INC.,
as Borrower
CHASE BANK OF TEXAS, N.A.,
as Administrative Agent
and
THE CHASE MANHATTAN BANK OF CANADA
as Canadian Sub-Agent
and
THE BANKS NAMED HEREIN,
as Banks
Dated as of October 27, 1998
--------------------------
CHASE SECURITIES INC.,
as Arranger
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TABLE OF CONTENTS
Page
ARTICLE I
Definitions and Accounting Terms................................... 1
SECTION 1.01. Certain Defined Terms........................................ 1
SECTION 1.02. Computation of Time Periods.................................. 23
SECTION 1.03. Accounting Terms............................................. 23
SECTION 1.04. Number and Gender of Words................................... 23
SECTION 1.05. Exchange Rates and Assigned Dollar Values................. 23
ARTICLE II
Amounts and Terms of the Advances.................................. 24
SECTION 2.01. The Commitments.............................................. 24
SECTION 2.02. Making the Contract Advances................................. 25
SECTION 2.03. The Competitive Advances..................................... 27
SECTION 2.04. Conversion and Continuation of Contract Borrowings........... 32
SECTION 2.05. Fees......................................................... 34
SECTION 2.06. Reduction or Termination of the Commitments.................. 34
SECTION 2.07. Repayment of Advances; Prepayment............................ 35
SECTION 2.08. Interest..................................................... 37
SECTION 2.09. Alternate Rate of Interest................................... 38
SECTION 2.10. Increased Costs; Increased Capital........................... 38
SECTION 2.11. Additional Interest on Eurodollar Rate Advances.............. 40
SECTION 2.12. Change in Legality........................................... 40
SECTION 2.13. Payments and Computations.................................... 41
SECTION 2.14. Taxes on Payments............................................ 42
SECTION 2.15. Sharing of Payments, Etc. ................................... 45
SECTION 2.16. Removal of a Bank............................................ 46
SECTION 2.17. Canadian Borrowers; Canadian Commitments..................... 47
SECTION 2.18. Canadian Banker's Acceptances................................ 48
ARTICLE III
Conditions of Lending.............................................. 48
SECTION 3.01. Conditions Precedent to Closing.............................. 48
SECTION 3.02. Conditions Precedent to Each Borrowing....................... 50
SECTION 3.03. Conditions Precedent to Canadian Borrowings.................. 51
ARTICLE IV
Representations and Warranties..................................... 51
ARTICLE V
Covenants of the Company........................................... 54
SECTION 5.01. Affirmative Covenants........................................ 54
SECTION 5.02. Negative Covenants........................................... 58
ARTICLE VI
Events of Default.................................................. 64
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ARTICLE VII
The Administrative Agent........................................... 68
SECTION 7.01. Authorization and Action..................................... 68
SECTION 7.02. Administrative Agent's Reliance, Etc. ....................... 68
SECTION 7.03. Administrative Agent and Affiliates.......................... 69
SECTION 7.04. Bank Credit Decision......................................... 69
SECTION 7.05. Indemnification.............................................. 70
SECTION 7.06. Successor Administrative Agent............................... 70
SECTION 7.07. Canadian Sub-Agent........................................... 71
ARTICLE VIII
Miscellaneous...................................................... 71
SECTION 8.01. Amendments, Etc. ............................................ 71
SECTION 8.02. Notices, Etc. ............................................... 72
SECTION 8.03. No Waiver; Remedies.......................................... 73
SECTION 8.04. Costs, Expenses and Taxes.................................... 73
SECTION 8.05. Right of Set-off............................................. 74
SECTION 8.06. Binding Effect............................................... 74
SECTION 8.07. Assignments and Participations............................... 74
SECTION 8.08. GOVERNING LAW................................................ 79
SECTION 8.09. Exceptions to Covenants...................................... 80
SECTION 8.10. Survival..................................................... 80
SECTION 8.11. Invalid Provisions........................................... 80
SECTION 8.12. Maximum Rate................................................. 80
SECTION 8.13. Execution in Counterparts.................................... 81
SECTION 8.14. Not in Control............................................... 81
SECTION 8.15. INDEMNIFICATION.............................................. 81
SECTION 8.16. ENTIRETY..................................................... 82
SECTION 8.17. WAIVER OF JURY TRIAL......................................... 82
SECTION 8.18. Conversion of Currencies..................................... 83
SECTION 8.19. Interest Act (Canada)........................................ 83
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Annex
Annex I Banker's Acceptances
Exhibits
Exhibit A-1 Form of Notice of Contract Borrowing
Exhibit A-2 Form of Notice of Competitive Borrowing
Exhibit A-3 Form of Notice of Competitive Bid Request
Exhibit A-4 Form of Competitive Bid
Exhibit A-5 Form of Competitive Bid Acceptance/Reject Letter
Exhibit B Form of Assignment and Acceptance Agreement
Exhibit C-1 Form of Opinion of Company's Counsel
Exhibit C-2 Form of Opinion of Company's New York Counsel
Exhibit C-3 Form of Opinion of Canadian Counsel
Exhibit D Form of Guarantee Agreement
Exhibit E Form of Notice of Drawing
Exhibit F Form of Discount Note
Schedules
Schedule I Banks, Lending Offices and Commitments
Schedule II Principal Subsidiaries
Schedule III Existing Liens
Schedule IV Letters of Credit
Schedule V Outstanding Banker's Acceptances
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This FIVE-YEAR COMPETITIVE ADVANCE/REVOLVING
CREDIT AGREEMENT is entered into as of October 27,
1998, among UNION PACIFIC RESOURCES GROUP INC., a
Utah corporation (the "Company"), the Banks (as
hereinafter defined), CHASE BANK OF TEXAS, N.A., as
Administrative Agent (as hereinafter defined) and THE
CHASE MANHATTAN BANK OF CANADA, as Canadian Sub-Agent
(as hereinafter defined).
ARTICLE I
Definitions and Accounting Terms
SECTION 1.01. Certain Defined Terms. As used in this Agreement, the
following terms shall have the following meanings (such meanings to be equally
applicable to both the singular and plural forms of the terms defined):
"Acceptance" means a Draft denominated in Canadian Dollars drawn by any
Canadian Borrower on a Canadian Bank and includes a depository bill within the
meaning of the Depository Bills and Notes Act (Canada), as provided therein, in
each case conforming to the requirements of this Agreement and accepted by such
Canadian Bank in accordance with this Agreement. As the context shall require,
"Acceptance" also has the meaning assigned to it in paragraph (j) of Annex I.
"Acceptance Borrowing" means a group of Acceptances in respect of
Drafts that are drawn by the same Canadian Borrower and accepted by the Canadian
Banks on the same date and have the same maturity date.
"Acceptance Equivalent Loan" means an advance made under this Agreement
in Canadian Dollars by a Canadian Bank to a Canadian Borrower evidenced by a
Discount Note.
"Acceptance Fee" has the meaning assigned to it in Section 2.05(c).
"Acceptance Obligation" means with respect to each Acceptance, the
obligation of the applicable Canadian Borrower to pay to the Canadian Bank that
accepted such Acceptance the face amount thereof as required by this Agreement
and the terms of such Acceptance.
"Administrative Agent" means Chase Bank of Texas, N.A. and its
permitted successor or successors as administrative agent for the Banks under
this Agreement, and, in respect of Canadian Advances, means the Canadian
Sub-Agent.
"Advance" means any US Advance or Canadian Advance.
"Affiliate" of a Person means any other individual or entity who
directly or indirectly controls, is controlled by, or is under common control
with that Person; provided that, for purposes of Article IV(k) and Section
5.02(g) hereof, the Subsidiaries of the Company shall not be considered
Affiliates of the Company or any Subsidiary (including any Restricted
Subsidiary), and the Company shall not be considered an Affiliate of a
Subsidiary (including any Restricted Subsidiary). For purposes of such
definition, "control," "controlled by," and "under common control with" mean the
possession, directly or indirectly, of the power to direct or cause the
direction of the management or policies of a Person (whether through ownership
of voting securities or other interests, by contract or otherwise).
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"Agreement" means this Agreement, as amended, modified and supplemented
from time to time, including, without limitation, any such supplement in respect
of Competitive Advances under Section 2.03.
"Applicable BA Discount Rate" means, with respect to an Acceptance (a)
being purchased by any Canadian Schedule I Bank on any day, the percentage
discount rate equal to the CDOR Rate on such day (expressed to two decimal
places and rounded upward, if necessary, to the nearest 1/100th of 1%) for
bankers' acceptances in an amount and having a maturity date comparable to the
amount and maturity date of such Acceptance, and (b) being purchased by any
Canadian Schedule II Bank on any day, the lesser of (i) the arithmetic average
of the percentage discount rates (expressed to two decimal places and rounded
upward, if necessary, to the nearest 1/100th of 1%) quoted by the Canadian
Schedule II Reference Banks as that at which the Canadian Schedule II Reference
Banks would, in accordance with normal practice, at or about 10:00 a.m.
(Toronto, Ontario time), on such day, be prepared to purchase bankers'
acceptances in an amount and having a maturity date comparable to the amount and
maturity date of such Acceptance and (ii) the percentage discount rate
calculated pursuant to clause (a) above, plus .08% per annum.
"Applicable Canadian Pension Legislation" means, at any time, the
Income Tax Act (Canada), the Pension Benefits Standards Act, 1985 (Canada), the
Employment Pension Plans Act (Alberta) and any other pension legislation then
applicable to any Canadian Borrower, including all regulations made thereunder,
and all rules, regulations, rulings and interpretations made or issued by any
governmental authority having or asserting jurisdiction in respect thereof.
"Applicable Margin" means, on any date of determination of the interest
rate for any Eurodollar Rate Contract Borrowing or of any Facility Fees or
Acceptance Fees, the applicable percentage set forth in the table below for
Eurodollar Rate Contract Borrowings or Facility Fees or Acceptance Fees, as
appropriate, which corresponds to the ratings (or implied ratings) established
by both S&P and Moody's applicable to the Company's senior, unsecured,
non-credit-enhanced long term indebtedness for borrowed money ("Index Debt") on
such date of determination; provided that at any time when (i) the Canadian
Exposure hereunder exceeds (ii) 50% of the Maximum Canadian Allocation Amount,
the Applicable Margin for Acceptance Fees shall be increased by 0.125%:
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APPLICABLE MARGIN FOR
EURODOLLAR RATE CONTRACT
BORROWINGS AND APPLICABLE MARGIN FOR DRAWN
RATINGS ACCEPTANCE FEES FACILITY FEES COST
- -----------------------------------------------------------------------------------------------------------
Category 1 0.22% 0.08% 0.30%
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Greater than or equal to
A-/A3
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Category 2 0.25% 0.10% 0.35%
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BBB+/Baa1
- -----------------------------------------------------------------------------------------------------------
Category 3 0.35% 0.125% 0.475%
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BBB/Baa2
- -----------------------------------------------------------------------------------------------------------
Category 4 0.35% 0.15% 0.50%
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BBB-/Baa3
- -----------------------------------------------------------------------------------------------------------
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- -----------------------------------------------------------------------------------------------------------
APPLICABLE MARGIN FOR
EURODOLLAR RATE CONTRACT
BORROWINGS AND APPLICABLE MARGIN FOR DRAWN
RATINGS ACCEPTANCE FEES FACILITY FEES COST
- -----------------------------------------------------------------------------------------------------------
Category 5 0.55% 0.25% 0.80%
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Less than BBB-/Baa3
- -----------------------------------------------------------------------------------------------------------
For purposes of the foregoing, (a) if neither Moody's nor S&P shall have in
effect a rating for Index Debt (other than by reason of the circumstances
referred to in the last sentence of this definition), then both such rating
agencies will be deemed to have established ratings for Index Debt in Category
5; (b) if only one of Moody's or S&P shall have in effect a rating for Index
Debt, the Company and the Banks will negotiate in good faith to agree upon
another rating agency to be substituted by an amendment to this Agreement for
the rating agency which shall not have a rating in effect, and in the absence of
such amendment the Applicable Margin will be determined by reference to the
available rating; (c) if the ratings established by Moody's and S&P shall fall
within different Categories, the Applicable Margin shall be determined by
reference to the numerically lower Category (for example, if the rating from S&P
is in Category 1 and the rating from Moody's is in Category 2, the Applicable
Margin shall be determined by reference to Category 1); and (d) if any rating
established by Moody's or S&P shall be changed (other than as a result of a
change in the rating system of either Moody's or S&P), such change shall be
effective as of the date on which such change is first announced by the rating
agency making such change. Each change in the Applicable Margin 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 either Moody's or S&P shall change, the Company and the
Banks shall negotiate in good faith to amend the references to specific ratings
in this definition to reflect such changed rating system. If both Moody's and
S&P shall cease to be in the business of rating corporate debt obligations, the
Company and the Banks shall negotiate in good faith to agree upon a substitute
rating agency and to amend the references to specific ratings in this definition
to reflect the ratings used by such substitute rating agency.
"Applicable Lending Office" means, with respect to each Bank, such
Bank's Domestic Lending Office in the case of an Alternate Base Rate Advance,
such Bank's Canadian Lending Office in the case of a Canadian Advance, such
Bank's Eurodollar Lending Office in the case of a Eurodollar Rate Contract
Advance and, in the case of a Competitive Advance, the office or affiliate of
such Bank notified by such Bank to the Company and the Administrative Agent as
such Bank's Applicable Lending Office with respect to such Competitive Advance.
"Applicable Rate" means:
(a) with respect to Alternate Base Rate Advances, the Alternate Base
Rate;
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(b) with respect to Eurodollar Rate Contract Advances, the Eurodollar
Rate plus the Applicable Margin for Eurodollar Rate Contract Borrowings; and
(c) with respect to Canadian Prime Rate Contract Advances, the Canadian
Prime Rate.
"Assessment Rate" means for any date of determination, the annual rate
(rounded upwards, if necessary, to the next 1/100 of 1%) most recently estimated
by the Administrative Agent as the then current net annual assessment rate that
will be employed in determining amounts payable by the Administrative Agent to
the Federal Deposit Insurance Corporation (or any successor) for insurance by
such Corporation (or such successor) of time deposits made in US Dollars at the
Administrative Agent's domestic offices.
"Assigned Dollar Value" means, with respect to any Canadian Borrowing
at any time, (a) in the case of Canadian Borrowings denominated in US dollars,
the amount thereof and (b) in the case of Canadian Borrowings denominated in
Canadian Dollars, the US Dollar Equivalent thereof most recently determined
pursuant to Section 1.05.
"Assignment and Acceptance" means an assignment and acceptance entered
into by a Bank and an Eligible Assignee, and accepted by the Administrative
Agent, in substantially the form of Exhibit B hereto.
"BA Discount Proceeds" means, in respect of any Acceptance being
purchased by a Canadian Bank on any day under this Agreement, an amount (rounded
to the nearest whole Canadian cent, and with one-half of one Canadian cent being
rounded up) calculated on such day by multiplying:
(a) the face amount of such Acceptance; by
(b) the quotient equal to one divided by the sum of one plus the
product of:
(i) the Applicable BA Discount Rate applicable to such
Acceptance; and
(ii) a fraction, the numerator of which is the number of
days remaining in the term of such Acceptance and the
denominator of which is 365;
with such quotient being rounded up or down to the nearest fifth decimal place
and .000005 being rounded up.
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"Banks" means the financial institutions named on Schedule I (as the
same may be amended from time to time by the Administrative Agent to reflect
assignments made in accordance with Section 8.07 of this Agreement), and any and
all other financial institutions which from time to time become parties to this
Agreement pursuant to the terms and conditions of Section 8.07 of this
Agreement. Canadian Schedule II Banks named (whether as of the date hereof or by
assignment) on Schedule I to this Agreement must enter into this Agreement
together with a Designated Bank Affiliate (which shall also be named on Schedule
I to this Agreement) which expressly agrees to be bound by the terms of, and to
make Advances in accordance with, this Agreement.
"Board" means the Board of Governors of the Federal Reserve System of
the United States of America or any successor thereto.
"Borrowers" means the Company and any Canadian Borrower.
"Borrowing" means a US Borrowing or a Canadian Borrowing.
"Business Day" means any day that is not a Saturday, Sunday or other
day on which commercial banks in New York City or Dallas, Texas, are authorized
or required by law to remain closed; provided that (a) when used in connection
with a Eurodollar Rate Advance to the Company, the term "Business Day" shall
also exclude any day on which banks are not open for dealings in US Dollar
deposits in the London interbank market or (b) when used in connection with a
Canadian Borrowing, the term "Business Day" shall exclude any day on which
commercial banks are not open for business in Toronto or Calgary, Canada and New
York City and when used in connection with a Eurodollar Rate Advance to a
Canadian Borrower, the term "Business Day" shall also exclude any day on which
banks are not open for dealings in US Dollar deposits in the London interbank
market.
"Canadian Advance" means a Canadian Contract Advance or a Canadian
Competitive Advance.
"Canadian Alternate Base Rate" means, for any day, a rate per annum
equal to the lesser of (a) the Maximum Rate and (b) the greater of (i) the US
Base Rate in effect on such day, and (ii) the Federal Funds Effective Rate in
effect on such day plus 1/2 of 1%. For purposes hereof, "US Base Rate" means the
rate of interest per annum, announced from time to time by the Canadian
Sub-Agent as its base rate for lending US Dollars in Canada (which base rate may
not necessarily represent the lowest or best rate actually charged to a
customer); each change in the US Base Rate shall be effective on the date such
change is announced as effective. For purposes hereof, "Federal Funds Effective
Rate" means, for any day, the weighted average (rounded upwards, if necessary,
to the next 1/16 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
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such rate is not so published for any day which is a Business Day, the average
(rounded upwards, if necessary, to the next 1/16 of 1%) of the quotations for
the day of such transactions received by the Canadian Sub-Agent from three
Federal funds brokers of recognized standing selected by it. If for any reason
the Canadian Sub-Agent shall have determined (which determination shall be
conclusive absent manifest error) that it is unable to ascertain the Federal
Funds Effective Rate for any reason, including the inability of the Canadian
Sub-Agent to obtain sufficient quotations in accordance with the terms hereof,
the Canadian Alternate Base Rate shall be determined without regard to clause
(b) (ii) of the first sentence of this definition until the circumstances giving
rise to such inability no longer exist. Any change in the Canadian Alternate
Base Rate due to a change in the Maximum Rate, US Base Rate or the Federal Funds
Effective Rate shall be effective on the effective date of such change in the
Maximum Rate, US Base Rate or the Federal Funds Effective Rate, respectively.
"Canadian Alternate Base Rate Advance" means a Canadian Contract
Advance which bears interest computed at the Canadian Alternate Base Rate.
"Canadian Bank" means Canadian Schedule I Banks or Canadian Schedule II
Banks which are residents of Canada for purposes of the Income Tax Act (Canada).
"Canadian Borrower" means any wholly owned Subsidiary of the Company
that is organized under the laws of Canada or any jurisdiction therein and has
been designated by the Company as a Canadian Borrower in accordance with Section
2.17 and has not ceased to be a Canadian Borrower as provided in such Section.
"Canadian Borrowing" means a Canadian Contract Borrowing or a Canadian
Competitive Borrowing.
"Canadian Commitment" means, with respect to any Canadian Bank, the
portion, if any, of such Canadian Bank's Commitment that constitutes its
Canadian Commitment to make a Canadian Advance to a Canadian Borrower based upon
allocations made by the Company in accordance with Section 2.17.
"Canadian Competitive Advance" means either an Acceptance created as
part of, or a Eurodollar Rate Competitive Advance as part of, a Competitive
Borrowing resulting from the competitive bidding procedures described in Section
2.03 and in paragraph (m) of Annex I.
"Canadian Competitive Borrowing" means a Competitive Borrowing
consisting of Canadian Competitive Advances.
"Canadian Contract Advance" means either (a) an Acceptance created as
part of a Contract Borrowing or (b) a Canadian Prime Rate Contract Advance or a
Eurodollar Rate Contract Advance made as part of a Contract Borrowing by a
Canadian Borrower.
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"Canadian Contract Borrowing" means a Contract Borrowing in Canadian
Dollars or US Dollars consisting of Canadian Contract Advances.
"Canadian Dollars" or "Canadian $" means lawful money of Canada.
"Canadian Dollar Equivalent" means, on any date of determination, with
respect to any amount in US Dollars, the equivalent in Canadian Dollars of such
amount, determined by the Administrative Agent pursuant to Section 1.05.
"Canadian Exposure" means, at any time, the sum of the Assigned Dollar
Values of outstanding Canadian Advances at such time.
"Canadian Lending Office" means, with respect to any Canadian Bank, the
office or affiliate of such Canadian Bank specified as its "Canadian Lending
Office" opposite its name on Schedule I hereto, or in the Assignment and
Acceptance pursuant to which it became a Canadian Bank, or such other office or
affiliate of such Canadian Bank as such Canadian Bank may from time to time
specify to the Company, the Administrative Agent and the Canadian Sub-Agent.
"Canadian Prime Rate" means, for any day, a rate per annum equal to the
greater of (a) the rate per annum announced from time to time by the Canadian
Sub-Agent as its prime rate (being the reference rate it will use for
determining interest rates on commercial loans denominated in Canadian Dollars
to borrowers in Canada) in effect at its principal office in Toronto and (b) the
One-Month CDOR Rate plus .625%. Each change in the Canadian Prime Rate shall be
effective on the date such change is announced.
"Canadian Prime Rate Contract Advance" means a Canadian Contract
Advance in Canadian Dollars which bears interest computed at the Canadian Prime
Rate, payable monthly in arrears, from the date of advance thereof.
"Canadian Prime Rate Contract Borrowing" means a Canadian Contract
Borrowing consisting of Canadian Prime Rate Contract Advances.
"Canadian Schedule I Bank" means a Bank that is named on Schedule I to
the Bank Act (Canada).
"Canadian Schedule II Bank" means a Bank that is named on Schedule II
to the Bank Act (Canada).
"Canadian Schedule II Reference Banks" means The Chase Manhattan Bank
of Canada and Credit Suisse First Boston Canada, or such two other Canadian
Schedule II Banks as may be selected by the Canadian Sub-Agent in consultation
with the Company.
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"Canadian Sub-Agent" means, initially, The Chase Manhattan Bank of
Canada, or any other sub-agent appointed by the Administrative Agent pursuant to
Section 7.07 of this Agreement.
"CDOR Rate" means, on any day, the annual rate of interest which is
determined as being the arithmetic average, with respect to a particular term of
Canadian Dollar bankers' acceptances, of the rates displayed and identified as
such on the "Reuters' Screen CDOR Page" at approximately 10:00 a.m. (Toronto,
Ontario time) on such day for banks listed on Schedule I to the Bank Act
(Canada), or if such day is not a Business Day, then on the immediately
preceding Business Day (as adjusted by a Canadian Bank after 10:00 a.m.
(Toronto, Ontario time), to reflect any error in a posted rate of interest or in
the posted average annual rate of interest).
"Class", when used in respect of any Commitment, Advance or Borrowing,
refers to whether such Commitment is a US Commitment or a Canadian Commitment,
or whether such Advance is a US Advance or a Canadian Advance, or whether such
Borrowing is comprised of US Advances or Canadian Advances, as the case may be.
"Closing Date" means the date upon which this Agreement is executed and
delivered and all conditions precedent specified in Section 3.01 have been
satisfied or waived.
"Code" means the Internal Revenue Code of 1986, as the same may be
amended from time to time.
"Commitment" means, with respect to any Bank, the amount set forth
opposite such Bank's name on Schedule I under the caption "Commitment", as such
amount may be reduced pursuant to Section 2.06 or increased pursuant to Section
2.16 or reduced or increased by Section 8.07.
"Competitive Adjustment" means, as to any Bank as at any date, an
amount equal to such Bank's pro rata (in accordance with the Commitments) share
of the aggregate amount (based on Assigned Dollar Values, in the case of
Canadian Advances) of all Competitive Advances outstanding on such date (giving
effect to the payment of any Competitive Advances to be made on such date).
"Competitive Advance" means a US Competitive Advance or a Canadian
Competitive Advance.
"Competitive Borrowing" means a Borrowing consisting of simultaneous
Competitive Advances of the same Type and Class made to the same Borrower from
each of the Banks whose offer to make Competitive Advances as part of such
Borrowing has been accepted by such Borrower under the competitive bidding
procedures described in Section 2.03 and in paragraph (m) of Annex I.
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"Contract Advance" means a US Contract Advance or a Canadian Contract
Advance.
"Contract Borrowing" means a Borrowing consisting of simultaneous
Contract Advances of the same Type and Class made to the same Borrower ratably
by all of the Banks pursuant to Section 2.01(a) or ratably by all of the
Canadian Banks pursuant to Section 2.01(b).
"Debt" means (a) indebtedness for borrowed money; (b) obligations
evidenced by bonds, debentures, notes or other similar instruments; (c)
obligations to pay the deferred purchase price of property (excluding
obligations under agreements for the purchase of goods in the normal course of
business, but including obligations under agreements relating to the issuance of
performance letters of credit or acceptance financing); (d) obligations as
lessee under leases which shall have been or should be, in accordance with
generally accepted accounting principles, recorded as capital leases; (e)
obligations as account party under all letters of credit, and without
duplication, all drafts drawn and unpaid thereunder (excluding contingent
obligations under undrawn letters of credit supporting or relating to any of the
following: well reclamation costs, automobile deductible and insurance programs,
drilling deposits, security for untendered shares, settlement agreements,
development drilling programs, insurance programs and obligations, environmental
obligations, other security deposits, obligations supported by those letters of
credit described in Schedule IV hereto, and other obligations of the same type
as supported by such letters of credit, provided that letters of credit excluded
pursuant to this parenthetical clause shall not at any time exceed US
$70,000,000 in the aggregate); (f) obligations under direct or indirect
guaranties in respect of, and obligations (contingent or otherwise) to purchase
or otherwise acquire, or otherwise to assure a creditor against loss in respect
of, indebtedness or obligations of others of the kinds referred to in clauses
(a) through (e) above; and (g) liabilities in respect of underfunded or unfunded
vested benefits under Plans covered by Title IV of ERISA, or by Applicable
Canadian Pension Legislation; provided that "Debt" of the Company and its
Subsidiaries shall not include (i) any rental obligations, guaranties or other
lease obligations or financial assurances existing on the date of this Agreement
and relating to the leveraged lease of the Corpus Christi, Texas, petrochemical
complex and refinery, or (ii) any obligations as account party under letters of
credit issued in connection with, or in lieu of, any obligations described in
the preceding clause (i) arising at any time after the date of this Agreement.
In no event shall Debt include guarantees by the Company of up to $200,000,000
of debt by OCI Wyoming.
"Designated Bank Affiliate" means a US affiliate of a Canadian Schedule
II Bank which is a party to this Agreement.
"Designated Subsidiaries" has the meaning specified in Section 5.02(b).
"Discount Note" has the meaning specified in paragraph (i) of Annex I.
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"Domestic Lending Office" means, with respect to any Bank, the office
or affiliate of such Bank specified as its "Domestic Lending Office" opposite
its name on Schedule I hereto or in the Assignment and Acceptance pursuant to
which it became a Bank, or such other office or affiliate of such Bank as such
Bank may from time to time specify to the Company and the Administrative Agent.
"Domestic Reserve Percentage" means, for any Interest Period, the
reserve percentage applicable on the first day of such Interest Period under
regulations issued from time to time by the Board for determining the maximum
reserve requirement (including, but not limited to, any emergency, supplemental
or other marginal reserve requirement) for a member bank of the Federal Reserve
System in New York City, with deposits exceeding one billion US Dollars with
respect to liabilities consisting of or including (among other liabilities) US
Dollar nonpersonal time deposits in the United States of America with a maturity
equal to such Interest Period.
"Draft" means a draft or bill of exchange or depository bill within the
meaning of the Depository Bills and Notes Act (Canada), payable in Canadian
Dollars, in the form used from time to time by each Canadian Bank, respectively,
in connection with the creation of Acceptances in accordance with the provisions
of Annex I.
"EBITDAX" means, with respect to any Person for any period of
calculation, the sum of (a) operating income (before adjustments for income
taxes, interest expense or extraordinary gains or losses) for such period, (b)
depreciation, depletion and amortization for such period and (c) exploration
expenses for such period, all determined in accordance with generally accepted
accounting principles.
"Eligible Assignee" means: (a) any of the following entities, if
approved (which approval shall not be unreasonably withheld) in writing by the
Company (if no Event of Default then exists) and Administrative Agent: (i) a
commercial bank or other financial institution organized under the laws of the
United States of America, or any state thereof, and having total assets in
excess of $3,000,000,000 and a combined capital and surplus of at least
$150,000,000; (ii) a commercial bank or other financial institution organized
under the laws of any other country which is a member of the OECD, or a
political subdivision of any such country, and having total assets in excess of
$3,000,000,000 and a combined capital and surplus of at least $150,000,000;
provided that such bank or financial institution is acting through a branch or
agency located in the United States of America, in the country in which it is
organized or in another country which is also a member of the OECD; and (iii)
the central bank of any country which is a member of the OECD, (b) a Bank or an
Affiliate of any Bank; provided that with regard to clause (a) and clause (b) of
this sentence an "Eligible Assignee" of a Canadian Bank must be a Canadian Bank
if the assignee will have a Maximum Canadian Commitment Amount and provided
further that an assignee which is a Canadian Schedule II Bank must enter into
this Agreement together with a Designated Bank Affiliate (which shall also be
named on Schedule I
15
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to this Agreement) which expressly agrees to be bound by the terms of, and to
make Advances in accordance with, this Agreement, or (c) upon the occurrence and
during the continuance of an Event of Default, any other Person.
"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) which is a member of a group of which the Company is a member and
which is under common control within the meaning of the regulations under
Section 414 of the Code.
"Eurocurrency Liabilities" has the meaning assigned to that term in
Regulation D.
"Eurodollar Lending Office" means, with respect to any Bank, the office
or affiliate of such Bank specified as its "Eurodollar Lending Office" opposite
its name on Schedule I hereto or in the Assignment and Acceptance pursuant to
which it became a Bank (or, if no such office or affiliate is specified, its
Domestic Lending Office), or such other office or affiliate of such Bank as such
Bank may from time to time specify to the Company and the Administrative Agent.
"Eurodollar Rate" means, for each Eurodollar Rate Advance comprising
part of the same Borrowing, an interest rate per annum equal to the lesser of
(a) the Maximum Rate and (b) a rate of interest determined on the basis of at
least two offered rates for deposits in US Dollars for a period equal to the
applicable Interest Period commencing on the first day of such Interest Period,
appearing on the Reuters Screen LIBO Page as of 11:00 a.m. (London time) on the
day that is two Business Days prior to the first day of the Interest Period. If
at least two such offered rates appear on the Reuters Screen LIBO Page, the rate
with respect to such Interest Period will be the arithmetic average (rounded
upwards to the next 1/16th of 1%) of such offered rates. If fewer than two
offered rates appear, "Eurodollar Rate" in respect of any Interest Period will
be determined on the basis of the rates at which deposits in US Dollars are
offered by the Administrative Agent at approximately 11:00 a.m. (London time) on
the day that is two Business Days preceding the first day of such Interest
Period to prime banks in the London interbank market for a period equal to such
Interest Period commencing on the first day of such Interest Period.
"Eurodollar Rate Advance" means any Eurodollar Rate Contract Advance or
Eurodollar Rate Competitive Advance.
"Eurodollar Rate Competitive Advance" means a Competitive Advance which
bears interest based on the Eurodollar Rate.
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"Eurodollar Rate Contract Advance" means a Contract Advance in US
Dollars which bears interest based on the Eurodollar Rate.
"Eurodollar Rate Contract Borrowing" means a Contract Borrowing that
bears interest based on the Eurodollar Rate.
"Eurodollar Rate Reserve Percentage" of any Bank for any Eurodollar
Rate Advance means the reserve percentage applicable to such Bank on (a) in the
case of a Contract Advance, the first day of the Interest Period then applicable
to such Contract Advance and (b) in the case of a Competitive Advance, the date
of such Competitive Advance, under regulations issued from time to time by the
Board for determining the reserve requirement (including, without limitation,
any emergency, supplemental or other marginal reserve requirement) under
Regulation D, or in the case of Canadian Banks, under rules or regulations
issued by any governmental authority having or asserting lawful jurisdiction
over the Canadian Banks, then applicable to such Bank with respect to
liabilities or assets consisting of or including Eurocurrency Liabilities having
a term equal to such Interest Period or the term of such Competitive Advance, as
the case may be.
"Events of Default" has the meaning specified in Article VI.
"Exchange Rate" means, on any Business Day (a) with respect to Canadian
Dollars in relation to US Dollars, the spot rate as quoted by the Bank of Canada
as its noon spot rate at which US Dollars are offered on such Business Day for
Canadian Dollars, and (b) with respect to US Dollars in relation to Canadian
Dollars, the spot rate as quoted by the Bank of Canada as its noon spot rate at
which Canadian Dollars are offered on such day for US Dollars; provided that if
at the time of any such determination, for any reason, no such spot rate is
being quoted, the Administrative Agent, after consultation with the Company, may
use any reasonable method it deems appropriate to determine such rate, and such
determination shall be presumed correct absent manifest error.
"Facility Fee" has the meaning given to such term in Section 2.05.
"Federal Funds Effective Rate" has the meaning given to such term in
the definition of "US Alternate Base Rate" in this Section 1.01.
"Financial Officer" of any corporation shall mean the chief financial
officer, principal accounting officer, Treasurer, or Controller of such
corporation or such other person or persons designated by the Company in writing
to the Administrative Agent and the Canadian Sub-Agent (such written designation
shall include name, title and an original specimen signature of each such
person).
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"Fixed Rate" means an interest rate per annum (expressed in the form of
a decimal to no more than four decimal places) specified by a Bank making a US
Competitive Advance under the competitive bidding procedure described in Section
2.03.
"Fixed Rate Competitive Advance" means a US Competitive Advance which
bears interest based on the Fixed Rate.
"Granting Bank" has the meaning specified in Section 8.07(l).
"Guarantee Agreement" means the Guarantee Agreement, substantially in
the form of Exhibit D hereto, between the Company and the Administrative Agent.
"Index Debt" has the meaning specified in the definition of "Applicable
Margin" in Section 1.01.
"Interest Period" means, (a) for each Contract Advance comprising part
of the same Contract Borrowing, the period commencing on the date of such
Contract Advance or on the last day of the immediately preceding Interest Period
applicable to such Contract Advance, as the case may be, and ending on the last
day of the period selected by the applicable Borrower pursuant to the provisions
below; or (b) for each Competitive Advance comprising part of the same
Competitive Borrowing, the period commencing on the date of such Competitive
Advance and ending on the maturity selected by the applicable Borrower pursuant
to the provisions of Section 2.03(a). The duration of each such Interest Period
shall be (i) in the case of a Canadian Alternate Base Rate Advance or a US
Alternate Base Rate Advance or a Canadian Prime Rate Contract Advance, one
month, (ii) in the case of a Eurodollar Rate Advance, 1, 2, 3, or 6 months, as
the applicable Borrower may select (in the case of Contract Advances) by notice
to the Administrative Agent pursuant to Section 2.02(a), and in the case of
Competitive Advances, by notice to Administrative Agent pursuant to Section
2.03(a) and (iii) in the case of an Acceptance Borrowing, 30, 60 or 90 days (or
such other period as agreed to by the Canadian Sub-Agent and the Canadian
Banks), as the applicable Canadian Borrower may select by notice pursuant to
either Section 2.03(a) or paragraph (c) of Annex I attached hereto, as
applicable; provided, however, that:
(A) Interest Periods commencing on the same date for Contract
Advances comprising part of the same Contract Borrowing shall be of the
same duration;
(B) whenever the last day of any Interest Period would otherwise
occur on a day other than a Business Day in each of New York City ,
Dallas, Texas, Toronto, Ontario and London, the last day of such
Interest Period shall be extended to occur on the next succeeding
Business Day in all such cities; provided that in the case of any
Interest Period for a Eurodollar Rate Advance, that if such extension
would cause the last day of
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such Interest Period to occur in the next following calendar month, the
last day of such Interest Period shall occur on the next preceding
Business Day in all such cities; and
(C) no Interest Period shall end on a date later than the Maturity
Date.
"Lien" means any mortgage, pledge, lien, encumbrance, charge or
security interest of any kind, granted or created to secure Debt.
"Loan Papers" means (a) this Agreement, certificates delivered pursuant
to this Agreement and Exhibits and Schedules thereto; (b) any Notices, Drafts,
Acceptances and Discount Notes; (c) the Guarantee Agreement; (d) any notice
designating a Canadian Borrower pursuant to Section 2.17; and (d) all renewals,
extensions or restatements of, or supplements or amendments to, any of the
foregoing.
"Majority Banks" means at any time Banks that in the aggregate (a) hold
at least 51% of the sum of the Commitments at the time, or (b) after the expiry
or termination of the Commitments, hold at least 51% of the aggregate unpaid
principal amount of the Advances, determined based on Assigned Dollar Values in
the case of Canadian Advances.
"Margin Stock" has the meaning given such term under Regulation U.
"Material Plan" means either (a) a Plan under which the present value
of the vested benefits exceeds the fair market value of the assets of such Plan
allocable to such benefits by more than $20,000,000 or (b) a Plan whose assets
have a market value in excess of $100,000,000.
"Maturity Date" means October 27, 2003.
"Maximum Amount" and "Maximum Rate" means, for each Bank, the maximum
non-usurious amount and the maximum nonusurious rate of interest which, under
applicable law, such Bank is permitted to contract for, charge, take, reserve or
receive on the Obligation.
"Maximum Canadian Allocation Amount" means $330,000,000.
"Maximum Canadian Commitment Amount" means, with respect to any Bank,
the amount set forth opposite such Bank's name on Schedule I under the caption
"Canadian Commitment", which represents the maximum portion of such Bank's
Commitment that may be allocated as its Canadian Commitment. The Maximum
Canadian Commitment Amount of any Bank shall not exceed its Commitment.
"Moody's" means Moody's Investors Service, Inc. or any successor
thereto.
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"Multiemployer Plan" means a "multiemployer plan" as defined in Section
4001(a)(3) of ERISA to which the Company or any ERISA Affiliate is making or
accruing an obligation to make contributions, or has within any of the preceding
three plan years made or accrued an obligation to make contributions.
"Net Proceeds" means, with respect to any event (a) the cash proceeds
received in respect of such event including (i) any cash received in respect of
any non-cash proceeds, but only as and when received, (ii) in the case of a
casualty, insurance proceeds and (iii) in the case of a condemnation or similar
event, condemnation awards and similar payments, net of (b) the sum of (i) all
reasonable fees and out-of-pocket expenses paid by the Company and the
Subsidiaries to third parties (other than Affiliates) in connection with such
event, (ii) in the case of a sale or other disposition of an asset (including
pursuant to a casualty or condemnation), the amount of all payments required to
be made by the Company and the Subsidiaries as a result of such event to repay
Debt (other than Advances) secured by such asset or otherwise subject to
mandatory prepayment as a result of such event and (iii) the amount of all taxes
paid (or reasonably estimated to be payable) by the Company and the
Subsidiaries, and the amount of any reserves established by the Company and the
Subsidiaries to fund contingent liabilities reasonably estimated to be payable,
in each case during the year that such event occurred or the next succeeding
year and that are directly attributable to such event (as determined reasonably
and in good faith by the chief financial officer of the Company).
"Norcen" means Norcen Energy Resources Limited, a Canadian corporation.
"Notice" means a Notice of Contract Borrowing, Notice of Competitive
Borrowing or Notice of Drawing.
"Notice of Contract Borrowing" has the meaning specified in Section
2.02(a).
"Notice of Competitive Borrowing" has the meaning specified in Section
2.03(a).
"Notice of Drawing" has the meaning specified in paragraph (d)(i) of
Annex I.
"Obligation" means all present and future indebtedness, liabilities,
and obligations, and all renewals and extensions thereof, or any part thereof,
now or hereafter owed to Administrative Agent or any Bank by any Borrower
arising from, by virtue of or pursuant to any Loan Paper, together with all
interest accruing thereon, fees, costs and expenses payable under the Loan
Papers.
"OECD" means the Organization for Economic Cooperation and Development,
or any successor entity thereto.
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"One-Month CDOR Rate" means, on any day, the annual rate of interest
which is the rate determined as being the arithmetic average of the "BA 1 month"
rates applicable to Canadian Dollar bankers' acceptances displayed and
identified as such on the "Reuters' Screen CDOR Page" at approximately 10:00
a.m., Toronto time, on such day for banks listed on Schedule I to the Bank Act
(Canada), or if such day is not a Business Day then on the immediately preceding
Business Day (as adjusted by a Canadian Bank after 10:00 a.m., Toronto time, to
reflect any error in a posted rate of interest or in the posted average annual
rate of interest).
"Other Credit Agreements" means (a) the 364-Day Competitive
Advance/Revolving Credit Facility Agreement in an initial aggregate principal
amount of US $750,000,000 dated as of October 27, 1998, among the Company, Chase
Bank of Texas, N.A., as administrative agent, and the banks party thereto and
(b) the 364-Day Competitive Advance/Revolving Credit Facility Agreement in an
initial aggregate principal amount of US $1,000,000,000 dated as of October 27,
1998, among the Company, Chase Bank of Texas, N.A., as administrative agent, and
the banks party thereto, in each case as amended from time to time.
"Participating Bank" has the meaning specified in Section 2.03(a)(v).
"PBGC" means the Pension Benefit Guaranty Corporation and any entity
succeeding to any or all of its functions under ERISA and any pension commission
or similar body constituted under any Applicable Canadian Pension Legislation.
"Person" means an individual, partnership, corporation (including a
business trust), joint stock company, trust, unincorporated association, joint
venture or other entity, or a government or any political subdivision or agency
thereof.
"Plan" means an employee benefit plan (other than a Multiemployer Plan)
maintained for employees of the Company or any ERISA Affiliate and covered by
Title IV of ERISA or Applicable Canadian Pension Legislation.
"Previous Credit Agreements" means (a) the Competitive
Advance/Revolving Credit Agreement, dated as of April 16, 1996 (as amended,
extended, renewed or restated from time to time), among the Company, Texas
Commerce Bank National Association, as administrative agent, The Chase Manhattan
Bank (formerly Chemical Bank), as auction administration agent, Bank of America
NT&SA, as documentation agent, NationsBank of Texas, N.A., as syndication agent
and the banks party thereto, (b) the 364 Day Competitive Advance/Revolving
Credit Agreement, dated as of November 25, 1997 (as amended, extended, renewed
or restated from time to time), among the Company, Chase Bank of Texas, N.A., as
administrative agent, The Chase Manhattan Bank, as auction administration agent,
Bank of America NT&SA, as documentation agent, NationsBank of Texas, N.A., as
syndication agent and the banks party thereto, (c) the 364 Day Competitive
Advance/Revolving Credit Agreement,
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dated as of March 2, 1998 (as amended, renewed or restated from time to time)
among the Company, The Chase Manhattan Bank, as administrative agent, Bank of
Montreal, as syndication agent and the banks party thereto and (d) (i) the
Canadian $200,000,000 Extendible Revolving Term Credit Facility dated May 22,
1997 between the Canadian Imperial Bank of Commerce, as lender and Norcen, as
borrower, (ii) the Canadian $100,000,000 Amended and Restated Extendible
Revolving Term Credit Facility dated May 29, 1997 between The Royal Bank of
Canada, as lender and Norcen, as borrower, (iii) the Canadian $100,000,000
Amended and Restated Extendible Revolving Term Credit Facility dated May 29,
1997 between The Toronto-Dominion Bank, as lender and Norcen, as borrower, (iv)
the Canadian $50,000,000 Amended and Restated Extendible Revolving Term Credit
Facility dated June 9, 1997 between ABN AMRO Bank Canada, as lender and Norcen,
as borrower, and (v) the Canadian $50,000,000 Amended and Restated Extendible
Revolving Term Credit Facility dated May 29, 1997 between the Union Bank of
Switzerland (Canada), as lender and Norcen, as borrower. Union Pacific Resources
Inc., a Canadian corporation, is the successor entity of Norcen.
"Principal Property" means (a) any property owned or leased by the
Company or any Subsidiary, or any interest of the Company or any Subsidiary in
property, which is considered by the Company to be capable of producing oil, gas
or minerals in commercial quantities, (b) any refinery, smelter, processing or
manufacturing plant owned or leased by the Company or any Subsidiary, (c) all
present and future oil, gas, other liquid and gaseous hydrocarbons and other
minerals now or hereafter produced from any other Principal Property or to which
the Company or any Subsidiary may be entitled as a result of its ownership of
any Principal Property, and (d) all real and personal assets owned or leased by
the Company or any Subsidiary used in the drilling, gathering, processing,
transportation or marketing of any oil, gas, other liquid and gaseous
hydrocarbons or minerals, except (i) any such real or personal assets related
thereto employed in transportation, distribution, or marketing or (ii) any
refinery, smelter, processing or manufacturing plant, or portion thereof, which
property described in clauses (i) or (ii) hereof, in the opinion of the Board of
Directors of the Company, is not a principal plant or principal facility in
relation to the activities of the Company and its Restricted Subsidiaries, taken
as a whole.
"Principal Subsidiaries" means those Subsidiaries listed on Schedule II
hereto, as such Schedule may be amended and supplemented from time to time.
"Register" has the meaning specified in Section 8.07(c).
"Regulation D" means Regulation D of the Board as from time to time in
effect and all official rulings and interpretations thereunder or thereof.
"Regulation U" means Regulation U of the Board as from time to time in
effect and all official rulings and interpretations thereunder or thereof.
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"Reportable Event" means an event described in Section 4043(b) of ERISA
with respect to which the 30-day notice requirement has not been waived by the
PBGC.
"Restricted Subsidiary" means any Subsidiary which owns or leases (as
lessor or lessee) a Principal Property, but does not include any Subsidiary the
principal business of which is leasing machinery, equipment, vehicles or other
properties none of which is a Principal Property, or financing accounts
receivable, or engaging in ownership and development of any real property which
is not a Principal Property.
"Revaluation Date" means the last Business Day of each March, June,
September and December and such other Business Days as the Company may request
by prior notice to the Administrative Agent.
"S&P" means Standard and Poor's Rating Group, a division of McGraw
Hill, Inc., a New York corporation, or any successor thereto.
"SPC" has the meaning specified in Section 8.07(l).
"Subsidiary" of the Company means any corporation or other similar
entity of which more than 50% of the outstanding capital stock having ordinary
voting power to elect a majority of the Board of Directors of such corporation
or entity (irrespective of whether or not at the time capital stock of any other
class or classes of such corporation or entity shall or might have voting power
upon the occurrence of any contingency) is at the time directly or indirectly
owned by the Company, by the Company and one or more other Subsidiaries of the
Company, or by one or more other Subsidiaries of the Company.
"Termination Date" means the earlier of October 27, 2003, or the date
on which the Commitments shall terminate in accordance with the terms of this
Agreement.
"Termination Event" means (a) a "Reportable Event" described in Section
4043 of ERISA and the regulations issued thereunder (other than a "Reportable
Event" not subject to the provision for 30-day notice to the PBGC under such
regulations), or (b) the withdrawal of the Company or any of its ERISA
Affiliates from a Plan during a plan year in which it was a "substantial
employer" as defined in Section 4001(a)(2) of ERISA, or (c) the filing of a
notice of intent to terminate a Plan or the treatment of a Plan amendment as a
termination under Section 4041 of ERISA or Applicable Canadian Pension
Legislation, or (d) the institution of proceedings to terminate a Plan by the
PBGC, or (e) any other event or condition which might constitute grounds under
Section 4042 of ERISA or Applicable Canadian Pension Legislation for the
termination of, or the appointment of a trustee to administer, any Plan.
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"Transactions" means the execution, delivery and performance by each
Borrower of the Loan Papers to which it is or is to be a party, the borrowing of
Advances and the use of the proceeds thereof.
"Type", when used in respect of any Advance or Borrowing, refers to the
Rate by reference to which interest on such Advance or on the Advances
comprising such Borrowing is determined. For purposes hereof, "Rate" shall
include the Eurodollar Rate, the US Alternate Base Rate, the Fixed Rate and, in
the case of a Canadian Advance, the Canadian Prime Rate, the Canadian Alternate
Base Rate, and, in the case of an Acceptance, the Applicable BA Discount Rate.
"UPRCC" means UPR Capital Company, a Nova Scotia unlimited liability
company.
"UPRCC Notes" means senior, unsecured notes of UPRCC in an aggregate
principal amount of up to US$400,000,000, which may be issued by UPRCC from time
to time, in one or more offerings.
"US Advance" means a US Contract Advance or a US Competitive Advance,
in either case, in US Dollars.
"US Alternate Base Rate" means, for any day, a rate per annum equal to
the lesser of (a) the Maximum Rate and (b) the greatest of (i) the US Prime Rate
in effect on such day, (ii) the Base CD Rate in effect on such day plus 1% and
(iii) the Federal Funds Effective Rate in effect on such day plus 1/2 of 1%. For
purposes hereof, "US Prime Rate" means the rate of interest per annum, publicly
announced from time to time by the Administrative Agent as its prime rate in
effect at its principal office in New York City (which prime rate may not
necessarily represent the lowest or best rate actually charged to a customer);
each change in the US Prime Rate shall be effective on the date such change is
publicly announced as effective. "Base CD Rate" means the sum of (a) the product
of (i) the Three-Month Secondary CD Rate and (ii) 1.00 plus the Domestic Reserve
Percentage and (b) the Assessment Rate. "Three-Month Secondary CD Rate" means,
for any day, the secondary market rate for three-month certificates of deposit
reported as being in effect on such day (or, if such day shall not be a Business
Day, the next preceding Business Day) by the Board through the public
information telephone line of the Federal Reserve Bank of New York (which rate
will, under the current practices of the Board, be published in Federal Reserve
Statistical Release H.15(519) during the week following such day), or, if such
rate shall not be so reported on such day or such next preceding Business Day,
the average (rounded upwards, if necessary, to the next 1/16 of 1%) of the
secondary market quotations for three-month certificates of deposit of major
money center banks received at approximately 10:00 a.m. (New York City time) on
such day (or, if such day shall not be a Business Day, on the next preceding
Business Day) by the Administrative Agent from three New York City negotiable
certificate of deposit dealers of recognized standing selected by it.
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"Federal Funds Effective Rate" means, for any day, the weighted average (rounded
upwards, if necessary, to the next 1/16 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 which is a Business Day, the average (rounded upwards, if necessary, to the
next 1/16 of 1%) of the quotations for the day of such transactions received by
the Administrative Agent from three Federal funds brokers of recognized standing
selected by it. If for any reason the Administrative Agent shall have determined
(which determination shall be conclusive absent manifest error) that it is
unable to ascertain the Base CD Rate or the Federal Funds Effective Rate or both
for any reason, including the inability of the Administrative Agent to obtain
sufficient quotations in accordance with the terms hereof, the US Alternate Base
Rate shall be determined without regard to clause (b) of the first sentence of
this definition, as appropriate, until the circumstances giving rise to such
inability no longer exist. Any change in the US Alternate Base Rate due to a
change in the Maximum Rate, US Prime Rate, the Three-Month Secondary CD Rate or
the Federal Funds Effective Rate shall be effective on the effective date of
such change in the Maximum Rate, US Prime Rate, the Three-Month Secondary CD
Rate or the Federal Funds Effective Rate, respectively.
"US Alternate Base Rate Advance" means a US Contract Advance which
bears interest computed at the US Alternate Base Rate.
"US Borrowing" means a US Contract Borrowing or a US Competitive
Borrowing, in either case, in US Dollars.
"US Commitment" means, with respect to any Bank, its Commitment reduced
by the amount, if any, of its Canadian Commitment at the time.
"US Competitive Advance" means an advance by a Bank to the Company
denominated in US Dollars as part of a Competitive Borrowing resulting from the
competitive bidding procedure described in Section 2.03, and refers to a Fixed
Rate Competitive Advance or a Eurodollar Rate Competitive Advance.
"US Competitive Borrowing" means a Competitive Borrowing consisting of
US Competitive Advances.
"US Contract Advance" means an advance by a Bank denominated in US
Dollars to the Company as part of a Contract Borrowing and refers to an
Alternate Base Rate Advance or a Eurodollar Rate Contract Advance.
"US Contract Borrowing" means a Contract Borrowing in US Dollars
consisting of US Contract Advances.
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"US Dollar Equivalent" means, on any date of determination, with
respect to any amount in Canadian Dollars, the equivalent in US Dollars of such
amount, determined by the Administrative Agent pursuant to Section 1.05.
"US Dollars" or "$" means lawful money of the United States of America.
SECTION 1.02. Computation of Time Periods. In this Agreement in the
computation of periods of time from a specified date to a later specified date,
the word "from" means "from and including" and the words "to" and "until" each
means "to but excluding".
SECTION 1.03. Accounting Terms. All accounting terms not specifically
defined herein shall be construed in accordance with generally accepted
accounting principles from time to time in effect, and all accounting principles
shall be applied on a consistent basis so that the accounting principles in a
current period are comparable in all respects to those applied during the
preceding comparable period.
SECTION 1.04. Number and Gender of Words. Whenever in any Loan Papers
the singular number is used, the same shall include the plural, where
appropriate, and vice versa, and words of any gender shall include each other
gender, where appropriate.
SECTION 1.05. Exchange Rates and Assigned Dollar Values. (a) On the
date on which any Canadian Borrowing denominated in Canadian Dollars is to be
made, the Administrative Agent shall determine the Exchange Rate as of such date
for purposes of determining the US Dollar Equivalent of the Canadian Dollar
amount of such Borrowing specified in the applicable Notice. The initial
Assigned Dollar Value of such Borrowing shall be the US Dollar Equivalent so
determined.
(b) On each Revaluation Date on which any Canadian Borrowing
denominated in Canadian Dollars is outstanding, the Administrative Agent shall
determine the US Dollar Equivalent of each such outstanding Canadian Borrowing
based on the applicable Exchange Rate as of such Revaluation Date, and the
Assigned Dollar Value of each such Borrowing shall be adjusted to equal the US
Dollar Equivalent so determined. The Administrative Agent shall notify the Banks
and the Company of the Exchange Rate and Assigned Dollar Values so determined
and the resulting Canadian Exposure.
ARTICLE II
Amounts and Terms of the Advances
SECTION 2.01. The Commitments. (a) Each Bank (other than each Canadian
Schedule II Bank) severally agrees, on the terms and conditions hereinafter set
forth, to make US
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Contract Advances to the Company, in US Dollars, from time to time on any
Business Day during the period from the Closing Date until the Termination Date
in an aggregate amount not to exceed at any time outstanding such Bank's US
Commitment; provided, however, that at no time shall the aggregate outstanding
principal amount of US Contract Advances and US Competitive Advances exceed the
aggregate amount of the US Commitments. Each US Contract Borrowing shall be in
an aggregate amount of not less than $10,000,000 (subject to the terms of this
Section 2.01(a)) or an integral multiple of $5,000,000 in excess thereof and
shall consist of US Contract Advances of the same Type made on the same day by
the Banks ratably according to their respective US Commitments.
(b) Each Canadian Bank severally agrees, on the terms and conditions
hereinafter set forth, to make Canadian Contract Advances to any Canadian
Borrower from time to time on any Business Day during the period from the
Closing Date until the Termination Date in an aggregate amount (based on the
face amount thereof, in the case of Acceptances) the Assigned Dollar Values of
which shall not exceed at any time outstanding such Bank's Canadian Commitment;
provided, however, that at no time shall the Canadian Exposure exceed the
aggregate amount of the Canadian Commitments. In the case of Canadian Contract
Advances consisting of Acceptances, such Advances shall be made by the issuance
by the applicable Canadian Borrower, and acceptance by the applicable Canadian
Banks, of Drafts denominated in Canadian Dollars in the manner referred to in
Section 2.18. Each Canadian Contract Borrowing shall be in an aggregate amount
of not less than Canadian $10,000,000 (or, in the case of Eurodollar Rate
Contract Borrowings, $10,000,000) (subject to the terms of this Section 2.01(b))
or an integral multiple of Canadian $5,000,000 (or, in the case of Eurodollar
Rate Contract Borrowings, $5,000,000) in excess thereof and shall consist of
Canadian Contract Advances made to the same Canadian Borrower on the same day by
the Canadian Banks ratably accordingly to their respective Canadian Commitments.
(c) Within the limits and on the conditions set forth in this Section
2.01, each Borrower may from time to time borrow under this Section 2.01, prepay
under Section 2.07(c) and reborrow under this Section 2.01.
SECTION 2.02. Making the Contract Advances. (a) Each Contract Borrowing
(other than Canadian Contract Borrowings consisting of Acceptances, as to which
this Section shall not apply) shall be made on notice, given (i) in the case of
a US Borrowing consisting of US Alternate Base Rate Advances, not later than
11:00 a.m. (New York City time) on the Business Day prior to the date of the
proposed Borrowing; (ii) in the case of a US Borrowing consisting of Eurodollar
Rate Contract Advances, not later than 11:00 a.m. (New York City time) on the
third Business Day prior to the date of the proposed Contract Borrowing; (iii)
in the case of a Canadian Borrowing consisting of Canadian Prime Rate Contract
Advances, no later than 11:00 a.m. (Toronto time) on the first Business Day
prior to the date of the proposed Contract Borrowing; and (iv) in the case of a
Canadian Borrowing consisting of Eurodollar Rate Contract Advances, not later
than 11:00 a.m. (Toronto time) on the third Business Day prior to the date of
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the proposed Contract Borrowing by the Company to the Administrative Agent,
which shall give to each Bank or Canadian Bank, as applicable, prompt notice
thereof by cable or telecopy. Each such notice of a Contract Borrowing (a
"Notice of Contract Borrowing") shall be in substantially the form of Exhibit
A-1 hereto, specifying therein the requested (i) date of such Contract
Borrowing, (ii) Type and Class of Contract Advances comprising such Contract
Borrowing, (iii) aggregate amount of such Contract Borrowing (expressed in US
Dollars, in the case of a US Borrowing, or Canadian Dollars, in the case of a
Canadian Borrowing), (iv) Interest Period and (v) in the case of a Canadian
Borrowing, the identity of the Canadian Borrower. Each Bank or Canadian Bank, as
applicable, shall, before 12:00 noon (New York City time) on the date of any
such Contract Borrowing, make available for the account of its Applicable
Lending Office to the Administrative Agent at its address referred to in Section
8.02 (or, in the case of a Canadian Borrowing, to an account in Toronto, Canada,
designated by the Administrative Agent for such purpose), in same day funds,
such Bank's or Canadian Bank's ratable portion of such Contract Borrowing. Upon
the Administrative Agent's receipt of such funds and upon fulfillment of the
applicable conditions set forth in Article III, the Administrative Agent will
make such funds available to the applicable Borrower at the Administrative
Agent's aforesaid address (or, in the case of a Canadian Borrowing, at such
account as shall be mutually agreed by the Administrative Agent and the
applicable Borrower).
(b) Each Notice of Contract Borrowing shall be irrevocable and binding
on the applicable Borrower. In the case of any Contract Borrowing which the
related Notice of Contract Borrowing specifies is to be comprised of Eurodollar
Rate Contract Advances, the applicable Borrower shall indemnify each Bank
against any loss, cost or expense incurred by such Bank as a result of any
failure by such Borrower to complete such Borrowing (whether or not due to a
failure to fulfill on or before the date specified in such Notice of Contract
Borrowing the applicable conditions set forth in Article III), such losses,
costs and expenses to include, without limitation, any loss (including loss of
anticipated profits), cost or expense incurred by reason of the liquidation or
reemployment of deposits or other funds acquired by such Bank to fund the
Contract Advance to be made by such Bank as part of such Contract Borrowing when
such Contract Advance, as a result of such failure, is not made on such date.
(c) Unless the Administrative Agent shall have received notice from a
Bank prior to the date of any Contract Borrowing that such Bank will not make
available to the Administrative Agent such Bank's ratable portion of such
Contract Borrowing, the Administrative Agent may assume that such Bank has made
such portion available to the Administrative Agent on the date of such Contract
Borrowing in accordance with Section 2.02(a) and the Administrative Agent may,
in reliance upon such assumption, make available to the applicable Borrower on
such date a corresponding amount. If and to the extent that such Bank shall not
have so made such ratable portion available to the Administrative Agent, such
Bank and the applicable Borrower severally agree to repay to the Administrative
Agent forthwith on demand such corresponding amount (in the same currency),
together with interest thereon, for each day from the date such amount is made
available to such Borrower until the date such
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amount is repaid to the Administrative Agent, at (i) in the case of such
Borrower, the interest rate applicable at the time to Contract Advances
comprising such Contract Borrowing and (ii) in the case of a Canadian Prime Rate
Contract Advance by such Canadian Bank, an interest rate equal to the Canadian
Prime Rate plus 1.0%, and (iii) in the case of any other Contact Advance by such
Bank, an interest rate equal at all times to the Federal Funds Effective Rate.
If such Bank shall repay to the Administrative Agent such corresponding amount,
such amount so repaid shall constitute such Bank's Contract Advance as part of
such Contract Borrowing for purposes of this Agreement.
(d) The failure of any Bank to make the Contract Advance to be made by
it as part of any Contract Borrowing shall not relieve any other Bank of its
obligation, if any, hereunder to make its Contract Advance on the date of such
Contract Borrowing, but no Bank shall be responsible for the failure of any
other Bank to make the Contract Advance to be made by such other Bank on the
date of any Contract Borrowing.
SECTION 2.03. The Competitive Advances. (a) Each Bank (other than each
Canadian Schedule II Bank) severally agrees that the Company may request US
Competitive Borrowings under this Section 2.03 from time to time on any Business
Day during the period from the Closing Date until the Termination Date, in each
case on the terms and conditions hereinafter set forth; provided, however, that
at no time shall the aggregate amount of US Contract Advances and US Competitive
Advances outstanding exceed the aggregate amount of the US Commitments. Each US
Competitive Borrowing shall consist of US Competitive Advances of the same Type
made on the same day. Each Canadian Bank severally agrees that any Canadian
Borrower may request Canadian Competitive Borrowings under this Section 2.03
from time to time on any Business Day during the period from the Closing Date
until the Termination Date, in each case on the terms and conditions hereinafter
set forth; provided, however, that at no time shall the total Assigned Dollar
Values of the aggregate amount of Canadian Contract Advances and Canadian
Competitive Advances outstanding exceed the aggregate amount of the Canadian
Commitments. Each Canadian Competitive Borrowing shall consist of Canadian
Competitive Advances of the same Type made to the same Canadian Borrower on the
same day.
(i) The Company may request a US Competitive Borrowing and any Canadian
Borrower may request a Canadian Competitive Borrowing, under this Section
2.03 by delivering to the Administrative Agent (A) in the case of a
Borrowing consisting of Fixed Rate Competitive Advances, by not later than
10:00 a.m. (New York City time) on the Business Day prior to the day of the
proposed Competitive Borrowing, (B) in the case of an Acceptance Borrowing,
by not later than 11:00 a.m. (New York City time) on the second Business Day
prior to the day of the proposed Competitive Borrowing and (C) in the case
of a Borrowing consisting of Eurodollar Rate Competitive Advances, by not
later than 11:00 a.m. (New York City time) on the fourth Business Day prior
to the date of the proposed Competitive Borrowing, a notice of a Competitive
Borrowing (a "Notice of
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Competitive Borrowing"), in substantially the form of Exhibit A-2 hereto,
specifying the proposed (1) date of such Competitive Borrowing, (2) Type and
Class of Competitive Advances comprising such Competitive Borrowing, (3)
aggregate amount (which shall not be less than $10,000,000 or an integral
multiple of $5,000,000 in excess thereof in respect of a US Competitive
Borrowing or a Eurodollar Rate Competitive Advance to a Canadian Borrower,
or Cdn$10,000,000 or an integral multiple of Cdn$5,000,000 in respect of any
Acceptance Borrowing) of such Competitive Borrowing, (4) maturity date for
repayment of each Competitive Advance to be made as part of such Competitive
Borrowing (which maturity date shall be, in the case of a Fixed Rate
Competitive Borrowing, not earlier than seven days after the date of such
Borrowing, in the case of an Acceptance Borrowing, not later than 30, 60 or
90 days (or such other period as agreed to by the Canadian Sub-Agent and the
Canadian Banks) after the date of such Borrowing and, in the case of a
Eurodollar Rate Competitive Borrowing, not later than 1, 2, 3 or 6 months
after the date of such Borrowing, as the Company shall elect and, in any
case, on or prior to the Termination Date) and (5) any other terms to be
applicable to such Competitive Borrowing and (6) in the case of a Canadian
Borrowing, the identity of the Canadian Borrower. The Administrative Agent
shall in turn promptly deliver (by cable or telecopy) to each Bank or
Canadian Bank, as applicable, a notice of competitive bid request (a "Notice
of Competitive Bid Request"), in substantially the form of Exhibit A-3,
notifying the Banks or Canadian Banks, as applicable, of each request for a
Competitive Borrowing received by it from the Company and of the terms
contained in such Notice of Competitive Borrowing.
(ii) Each Bank or Canadian Bank, as applicable, shall, if, in its sole
discretion, it elects to do so, irrevocably offer to make one or more
Competitive Advances to the applicable Borrower as part of such proposed
Competitive Borrowing at a rate or rates of interest specified by such Bank
in its sole discretion, by notifying (by telecopy, cable or telephone (in
the case of telephone, immediately confirmed by telecopy)) the
Administrative Agent (which shall give prompt notice thereof to the
Company), (A) in the case of a Fixed Rate Competitive Borrowing, not later
than 9:30 a.m. (New York City time) on the date of such proposed Competitive
Borrowing specified in the Notice of Competitive Borrowing delivered with
respect thereto, (B) in the case of an Acceptance Borrowing, not later than
9:30 a.m. (New York City time) on the first Business Day prior to the date
of such proposed Competitive Borrowing specified in the Notice of
Competitive Borrowing delivered with respect thereto, and (C) in the case of
a Eurodollar Rate Competitive Borrowing, not later than 9:30 a.m. (New York
City time) on the third Business Day prior to the date of such proposed
Competitive Borrowing specified in the Notice of Competitive Borrowing
delivered with respect thereto, of the maximum amount of each Competitive
Advance which such Bank would be willing to make as part of such proposed
Competitive Borrowing (which amount may, subject to the provisos to the
first and second sentences of this Section 2.03(a), exceed such Bank's
Commitment of the applicable Class), the rate or rates of interest therefor
(and whether reserves are included
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therein) and such Bank's Applicable Lending Office with respect to each such
Competitive Advance and any other terms and conditions required by such
Bank; provided that, if the Administrative Agent in its capacity as a Bank
shall, in its sole discretion, elect to make any such offer, it shall notify
the Company of such offer no later than one quarter of an hour before the
time specified herein for notice of offers by the other Banks. Each
competitive bid shall be submitted by a Bank to the Administrative Agent on
a competitive bid form (a "Competitive Bid"), substantially similar to
Exhibit A-4. If any Bank shall fail to notify the Administrative Agent,
before the time specified herein for notice of offers, that it elects to
make such an offer, such Bank shall be deemed to have elected not to make
such an offer, and such Bank shall not be obligated or entitled to, and
shall not, make any Competitive Advance as part of such Competitive
Borrowing. If any Bank shall provide telephonic notice to the Administrative
Agent of its election to make an offer, but such telephonic notice has not
been confirmed by telecopy to the Administrative Agent at or before the time
specified herein for notice of offers, the Administrative Agent may, in its
sole discretion and without liability to such Bank or the applicable
Borrower, elect whether or not to provide notice thereof to the Company.
(iii) The applicable Borrower shall, in turn, (A) in the case of a
Fixed Rate Competitive Borrowing, not later than 10:30 a.m. (New York City
time) on the date of such proposed Competitive Borrowing specified in the
Notice of Competitive Borrowing delivered with respect thereto, (B) in the
case of an Acceptance Borrowing, not later than 10:30 a.m. (New York City
time) on the first Business Day prior to the date of such proposed
Competitive Borrowing specified in the Notice of Competitive Borrowing
delivered with respect thereto, and (C) in the case of a Eurodollar Rate
Competitive Borrowing, not later than 10:30 a.m. (New York City time) on the
third Business Day prior to the date of such proposed Competitive Borrowing
specified in the Notice of Competitive Borrowing delivered with respect
thereto, either:
(A) cancel such proposed Competitive Borrowing by giving the
Administrative Agent notice to that effect, or
(B) accept one or more of the offers made by any Bank or Banks
pursuant to paragraph (ii) above, in its sole discretion, by giving
notice to the Administrative Agent of the amount of each Competitive
Advance (which amount shall be equal to or greater than $5,000,000 in
respect of a US Competitive Borrowing or a Eurodollar Rate Competitive
Advance to a Canadian Borrower, or Cdn$5,000,000 in respect of any
other Canadian Competitive Borrowing, and equal to or less than the
maximum amount offered by such Bank, notified to the Company by the
Administrative Agent on behalf of such Bank for such Competitive
Advance pursuant to paragraph (ii) above) to be made by each Bank as
part of such Competitive Borrowing, and reject any remaining offers
made by
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Banks pursuant to paragraph (ii) above, by giving the Administrative
Agent notice to that effect; provided, however, that the aggregate
amount of such offers accepted by the Company shall be equal at least
to $10,000,000 or an integral multiple of $5,000,000 in excess thereof
in respect of a US Competitive Borrowing or a Eurodollar Rate
Competitive Advance to a Canadian Borrower, or to Cdn$10,000,000 or an
integral multiple of Cdn$5,000,000 in excess thereof in respect of any
other Canadian Competitive Borrowing. Each such notice of competitive
bid acceptance/rejection (a "Competitive Bid Accept/Reject Letter")
from the Company shall be in a form substantially similar to Exhibit
A-5.
(iv) If any Borrower notifies the Administrative Agent that such
Competitive Borrowing is canceled pursuant to paragraph (iii)(A) above, the
Administrative Agent shall give prompt notice (by cable or telecopy) thereof
to the Banks or Canadian Banks, as applicable, and such Competitive
Borrowing shall not be made.
(v) If any Borrower accepts one or more of the offers made by any Bank
or Banks pursuant to paragraph (iii)(B) above, such offer or offers and the
Notice of Competitive Borrowing in respect thereof shall constitute a
supplement to this Agreement in respect of such Competitive Borrowing and
the Competitive Advances made pursuant thereto, and the Administrative Agent
shall in turn promptly notify (A) each Bank that has made an offer as
described in paragraph (ii) above of the date and aggregate amount of such
Competitive Borrowing (expressed in US Dollars and, in the case of a
Canadian Borrowing, in Canadian Dollars based on the Canadian Dollar
Equivalent thereof), the interest rate thereon, and whether or not any offer
or offers made by such Bank pursuant to paragraph (ii) above have been
accepted by the Company, and (B) each Bank that is to make a Competitive
Advance as part of such Competitive Borrowing (a "Participating Bank" as to
such Competitive Borrowing) of the amount of each Competitive Advance to be
made by such Bank as part of such Competitive Borrowing and the maturity
date for the repayment of each such Competitive Advance (together with a
confirmation of the Administrative Agent's understanding of the interest
rate and any other terms applicable to each such Competitive Advance; the
Administrative Agent shall assume, unless notified by such Bank to the
contrary, that its understanding of such information is correct). Each such
Participating Bank shall, before 12:00 noon (New York City time) on the date
of such Competitive Borrowing specified in the notice received from the
Administrative Agent pursuant to clause (A) of the preceding sentence, make
available for the account of its Applicable Lending Office to the
Administrative Agent (at its address referred to in Section 8.02 (or, in the
case of a Canadian Borrowing, to an account designated by the Administrative
Agent for such purpose)) such Bank's portion of such Competitive Borrowing,
in same day funds, which, in the case of an Acceptance Borrowing, shall be
made available in Canadian Dollars in an amount equal to the Canadian
Equivalent of the US Dollar amount of the applicable Participating Bank's
portion of such Borrowing. Upon fulfillment of the applicable conditions set
forth in
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Article III and after receipt by the Administrative Agent of such funds, the
Administrative Agent will make such funds available to the applicable
Borrower at the Administrative Agent's aforesaid address (or, in the case of
a Canadian Borrowing, at such account as shall be mutually agreed by the
Administrative Agent and the applicable Borrower). Promptly after each
Competitive Borrowing, the Administrative Agent will notify each Bank of the
amount of the Competitive Borrowing (and, in the case of a Canadian
Borrowing, the Assigned Dollar Value thereof), such Bank's Competitive
Adjustment resulting therefrom, and the date upon which such Competitive
Adjustment commenced and is anticipated to terminate.
(b) Within the limits and on the conditions set forth in this Section
2.03, any Borrower may from time to time borrow under this Section 2.03, repay
pursuant to Section 2.07(b), prepay under Section 2.07(c) and reborrow under
this Section 2.03.
(c) In addition to Competitive Borrowings conducted by the
Administrative Agent pursuant to the procedures set forth in Section 2.03(a),
any Borrower may conduct competitive auctions for Competitive Advances. In the
event that any Borrower elects to conduct competitive auctions, such Borrower
shall, (i) give notice of such auction to the Canadian Sub-Agent and the
Administrative Agent, (ii) conduct each auction among all Banks or Canadian
Banks, as applicable, and (iii) in the event that such Borrower elects to accept
one or more bids, accept the lowest bid or bids. The applicable Borrower shall
promptly notify the Canadian Sub-Agent and the Administrative Agent of the terms
and conditions of the Advances made pursuant to competitive auctions conducted
by such Borrower.
SECTION 2.04. Conversion and Continuation of Contract Borrowings. (a)
The Borrowers shall have the right at any time upon prior irrevocable notice to
the Administrative Agent (i) not later than 12:00 noon (New York City time), one
Business Day prior to conversion, to convert any Contract Borrowing consisting
of Eurodollar Rate Contract Advances into a Contract Borrowing consisting of US
Alternate Base Rate Advances (in the case of a US Contract Borrowing) or
Canadian Alternate Base Rate Advances (in the case of a Canadian Contract
Borrowing), (ii) not later than 10:00 a.m. (New York City time), three Business
Days prior to conversion or continuation, to convert any US Contract Borrowing
consisting of US Alternate Base Rate Advances or any Canadian Contract Borrowing
consisting of Canadian Alternate Base Rate Advances into a Contract Borrowing
consisting of Eurodollar Rate Contract Advances or to continue any Contract
Borrowing consisting of Eurodollar Rate Contract Advances for an additional
Interest Period, and (iii) not later than 10:00 a.m. (New York City time), three
Business Days prior to conversion, to convert the Interest Period with respect
to any
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Contract Borrowing consisting of Eurodollar Rate Contract Advances to another
permissible Interest Period subject in each case to the following:
(i) each conversion or continuation shall be made pro rata among the
Banks or Canadian Banks, as applicable, in accordance with the respective
principal amounts of the Advances comprising the converted or continued
Contract Borrowing;
(ii) if less than all the outstanding principal amount of any Contract
Borrowing shall be converted or continued, the aggregate principal amount of
such Contract Borrowing converted or continued shall be in an amount of
$10,000,000 or an integral multiple of $5,000,000 in excess thereof (based
on the initial Assigned Dollar Value thereof, in the case of a Canadian
Borrowing);
(iii) accrued interest on an Advance (or portion thereof) being
converted shall be paid by the applicable Borrower at the time of
conversion;
(iv) if any Borrowing consisting of Eurodollar Rate Contract Advances
is converted at a time other than at the end of the Interest Period
applicable thereto, the applicable Borrower shall pay, upon demand, any
amounts due to the Banks pursuant to Section 8.04(b) as a result of such
conversion;
(v) any portion of a Contract Borrowing maturing or required to be
repaid in less than one month may not be converted into or continued as a
Borrowing consisting of Eurodollar Rate Contract Advances;
(vi) any portion of a Borrowing consisting of Eurodollar Rate Contract
Advances which cannot be converted into or continued as such by reason of
clause (v) above shall be automatically converted at the end of the Interest
Period in effect for such Borrowing into a Borrowing consisting of US
Alternate Base Rate Advances in the case of a US Borrowing or of Canadian
Alternate Base Rate Advances in the case of a Canadian Borrowing; and
(vii) no Interest Period may be selected for any Borrowing consisting
of Eurodollar Rate Contract Advances that would end later than the Maturity
Date.
(b) Each notice pursuant to clause (a) of this Section shall be
irrevocable and shall refer to this Agreement and specify (i) the identity and
amount of the Contract Borrowing that the Company requests be converted or
continued, (ii) whether such Contract Borrowing is to be converted to or
continued as a Borrowing consisting of Eurodollar Rate Contract Advances, US
Alternate Base Rate Advances or Canadian Alternate Base Rate Advances, (iii) if
such notice requests a conversion, the date of such conversion (which shall be a
Business Day), and (iv) if such Contract Borrowing is to be converted to or
continued as a Borrowing consisting of
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Eurodollar Rate Contract Advances, the Interest Period with respect thereto. If
no Interest Period is specified in any such notice with respect to any
conversion to or continuation as a Borrowing consisting of Eurodollar Rate
Contract Advances, the Company shall be deemed to have selected an Interest
Period of one month's duration. The Administrative Agent shall advise the other
Banks of any notice given pursuant to this Section 2.04(b) and of each Bank's or
Canadian Bank's, as applicable, portion of any converted or continued Contract
Borrowing. If the Company shall not have given notice in accordance with this
Section 2.04(b) to continue any Contract Borrowing into a subsequent Interest
Period (and shall not otherwise have given notice in accordance with this
Section 2.04 to convert such Contract Borrowing), such Contract Borrowing shall,
at the end of the Interest Period applicable thereto (unless repaid pursuant to
the terms hereof), automatically be continued into a new Interest Period as a
Borrowing consisting of US Alternate Base Rate Advances in the case of a US
Borrowing, or of Canadian Alternate Base Rate Advances in the case of a Canadian
Borrowing. The conversion or continuation of any Contract Borrowing as provided
herein shall not affect the Class of the applicable Borrowing or the identity of
the Borrower thereof.
SECTION 2.05. Fees. (a) Facility Fees. The Company shall pay to each
Bank, through the Administrative Agent, a facility fee (the "Facility Fee") on
the average daily amount of the Commitment of such Bank (whether used or unused)
(or, after such Bank's Commitment has terminated, on the outstanding principal
amount of Contract Advances made by such Bank, based on the Assigned Dollar
Value thereof in the case of Canadian Contract Advances) for the period from and
including the Closing Date up to, but excluding, the later of the Maturity Date
and the date of repayment of all outstanding Contract Advances, at a rate per
annum equal to the Applicable Margin for Facility Fees. Accrued Facility Fees
shall be payable in arrears, commencing on the last day of the calendar quarter
in which the Closing Date occurs, and thereafter, quarterly on the last day of
each March, June, September and December and on the Maturity Date; provided that
any Facility Fees accruing after the Termination Date shall be payable
contemporaneously with accrued interest on the Contract Advances on which such
Facility Fees have accrued. Facility Fees shall be payable in US Dollars.
(b) Fees of Administrative Agent. The Company shall pay to the
Administrative Agent, solely for its own account, the fees described in the
separate letter agreement dated September 2, 1998, between the Company and the
Administrative Agent on the dates specified therein.
(c) Acceptance Fee. Each Canadian Borrower agrees to pay to each
Canadian Bank a fee (the "Acceptance Fee") in advance, at a rate per annum equal
to the Applicable Margin, on the date of issue of each Acceptance of such
Canadian Bank pursuant to a Canadian Borrowing. All Acceptance Fees shall be
calculated on the face amount of the Acceptance issued and computed on the basis
of the actual number of days in the term thereof and a year of 365 days.
Acceptance Fees shall be payable in Canadian Dollars. The Acceptance Fee shall
be
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in addition to any other fees payable to each Canadian Bank in connection with
the issuance or discounting of such Acceptance.
SECTION 2.06. Reduction or Termination of the Commitments. (a) Unless
previously terminated, the Commitments (including the US Commitments and
Canadian Commitments) shall terminate on the Termination Date.
(b) The Company shall have the right, upon at least three Business
Days' irrevocable notice to the Administrative Agent, to terminate in whole or
reduce ratably in part the respective Commitments of the Banks (which reductions
shall be allocated, (i) in the case of Canadian Schedule I Banks, between their
US Commitments and Canadian Commitments and (ii) in the case of Canadian
Schedule II Banks, between the US Commitments of their Designated Bank
Affiliates and the Canadian Commitments of the Canadian Schedule II Banks, in
each case as specified in the notice of such reduction); provided, however, that
(A) each partial reduction shall be in the aggregate amount of $10,000,000 or in
an integral multiple of $5,000,000 in excess thereof, and (B) no such
termination or reduction shall be made which would reduce the US Commitments to
an amount less than the aggregate outstanding principal amount of the US
Advances or would reduce the Canadian Commitments to an amount less than the
Canadian Exposure. The Administrative Agent shall promptly thereafter notify
each Bank of such termination or reduction.
SECTION 2.07. Repayment of Advances; Prepayment. (a) On the Maturity
Date each Borrower shall repay to the Administrative Agent for the account of
each Bank the principal amount of each Contract Advance made to such Borrower by
such Bank.
(b) Each Borrower shall repay to the Administrative Agent, for the
account of each Participating Bank which has made a Competitive Advance to such
Borrower, on the maturity date of each Competitive Advance (such maturity date
being that specified by the Company for repayment of such Competitive Advance in
the Notice of Competitive Borrowing delivered with respect thereto) the then
unpaid principal amount of such Competitive Advance.
(c) Any Borrower may, on notice given to the Administrative Agent (i)
in the case of US Alternate Base Rate Advances, not later than 11:00 a.m. (New
York City time) one Business Day prior to the day of the proposed prepayment,
(ii) in the case of Canadian Alternate Base Rate Advances, not later than 11:00
a.m. (Toronto time) one Business Day prior to the day of the proposed
prepayment, (iii) in the case of Eurodollar Rate Contract Advances, not later
than 11:00 a.m. (New York City time) on the third Business Day prior to the day
of the proposed prepayment and (iv) in the case of Canadian Prime Rate Contract
Advances, not later than 11:00 a.m. (Toronto time) one Business Day prior to the
day of the proposed prepayment, stating the proposed date and aggregate
principal amount of the prepayment, and if such notice is given, such Borrower
shall, prepay the outstanding principal amounts of the Contract Advances
constituting part of the same Contract Borrowing of such Borrower in whole or
ratably in part;
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provided, however, that any such partial prepayment shall be in an aggregate
principal amount not less than $10,000,000 (or Canadian $10,000,000, in the case
of Canadian Prime Rate Contract Advances), or in an integral multiple of
$5,000,000 (or Canadian $5,000,000, in the case of Canadian Prime Rate Contract
Advances) in excess thereof. No Borrower may prepay any principal amount of any
Competitive Advance unless the Participating Bank making such Competitive
Advance shall have expressly agreed thereto. Acceptances may not be prepaid. The
Administrative Agent shall promptly notify each Bank of any prepayments pursuant
to this Section 2.07(c) promptly after any such prepayment. No Borrower shall
have the right to prepay any principal amount of any Advance except as expressly
set forth in this Section 2.07.
(d) On the date of any reduction or termination of the Commitments, the
Borrowers shall pay or prepay so much of the Contract Advances (other than
Acceptances) and the Canadian Borrowers shall deposit with the Canadian
Sub-Agent cash collateral (in Canadian Dollars) to secure repayment of
Acceptances, in each case in such amounts as shall be necessary in order that
after giving effect to such reduction (i) the aggregate principal amount of
outstanding Advances (based on Assigned Dollar Values, in the case of Canadian
Advances), net of such cash collateral, shall not exceed the Commitments, (ii)
the aggregate principal amount of outstanding US Advances shall not exceed the
US Commitments and (iii) the Canadian Exposure, net of such cash collateral,
shall not exceed the Canadian Commitments. In the event that, after giving
effect to the prepayment of Contract Advances and deposit of cash collateral in
respect of Acceptances pursuant to this paragraph, there remain outstanding
Competitive Advances in a principal amount greater than the amount permitted by
the preceding sentence, the Borrowers shall not be required to prepay such
Competitive Advances unless Banks holding such Competitive Advances request
prepayment, in which event the Borrowers shall prepay such Competitive Advances;
provided that the Borrowers shall not be required to so prepay Competitive
Advances after the outstanding principal amount of Competitive Advances has been
reduced by the amount required to comply with this paragraph.
(e) If, after giving affect to any adjustment of Assigned Dollar Values
on any Revaluation Date, the Canadian Exposure (net of cash collateral deposited
with the Canadian Sub-Agent to secure repayment of Acceptances as provided
herein) exceeds 110% of the total Canadian Commitments, the Canadian Borrowers
shall, within three Business Days thereafter, prepay Canadian Prime Rate
Contract Advances or Eurodollar Rate Contract Advances or deposit cash
collateral (in Canadian Dollars) with the Canadian Sub-Agent to secure repayment
of Acceptances in an amount sufficient to eliminate such excess.
(f) Any prepayment of Eurodollar Rate Contract Advances pursuant to any
paragraph of this Section shall be subject to the provisions of Section 8.04(b)
hereof.
(g) Any cash collateral deposited with the Canadian Sub-Agent pursuant
to Section 2.07(d) hereof shall be released by the Canadian Sub-Agent to the
Canadian Borrowers within three Business Days after the maturity and payment in
full by the applicable Canadian
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Borrower of Acceptances to the extent that such payment in full causes the cash
collateral to no longer be required pursuant to Section 2.07(d). Any cash
collateral deposited with the Canadian Sub-Agent pursuant to Section 2.07(e)
hereof shall be released by the Canadian Sub-Agent to the Canadian Borrowers
within three Business Days after each Revaluation Date to the extent that
adjustments of the Assigned Dollar Values cause the cash collateral to no longer
be required pursuant to Section 2.07(e).
SECTION 2.08. Interest. Each Borrower shall pay interest on each
Advance made by each Bank to such Borrower from the date of such Advance until
paid in full, at the following rates per annum:
(a) Contract Advances. If such Advance is a Contract Advance (other
than an Acceptance), the Applicable Rate from time to time for such Contract
Advance from the date of such Advance until the last day of the last
Interest Period therefor, payable on the last day of each Interest Period
and, in the case of any Interest Period longer than three months, on the
last day of such three-month period, as the case may be.
(b) Competitive Advances. If such Advance is a Competitive Advance
(other than an Acceptance), a rate per annum equal at all times from the
date of such Advance until the maturity thereof to the rate of interest for
such Competitive Advance specified by the Participating Bank making such
Competitive Advance in its Competitive Bid with respect thereto delivered
pursuant to Section 2.03(a)(ii) above, payable on the proposed maturity date
specified by the Company for such Competitive Advance in the related Notice
of Competitive Borrowing delivered pursuant to Section 2.03(a)(i) above;
provided that in the case of Advances with maturities of greater than three
months, interest shall be payable at the end of each three-month period for
such Advance.
(c) Default Amounts. In the case of any past-due amounts of the
principal of, or (to the fullest extent permitted by law) interest on, any
Advance, from the date such amount becomes due until paid in full, payable
on demand, a rate per annum equal at all times to (i) 2% above the
Eurodollar Rate in the case of any outstanding Eurodollar Rate Advances
until the end of their respective Interest Periods, (ii) 2% above the US
Alternate Base Rate in the case of amounts payable with respect to a US
Advance other than a Eurodollar Rate Advance, or (iii) 2% above the Canadian
Prime Rate in the case of amounts payable with respect to a Canadian Advance
other than a Eurodollar Rate Advance, in effect from time to time.
SECTION 2.09. Alternate Rate of Interest. If Banks having more than
66-2/3% of the sum of the Commitments of the applicable Class shall, at least
one Business Day before the date of any requested Eurodollar Rate Contract
Borrowing (including any requested conversion or continuation of any such
Borrowing), notify the Administrative Agent that the Eurodollar Rate for any
Eurodollar Rate Advances comprising such Borrowing will not
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adequately reflect the cost to such Banks of making or funding their respective
Advances for such Borrowing, the right of the Company to select Advances of such
Type for such Borrowing or any subsequent Borrowing shall be suspended until the
Administrative Agent shall notify the Company and the Banks that the
circumstances causing such suspension no longer exist, and (a) any request by
the Company for a Eurodollar Rate Competitive Advance shall be of no force and
effect and shall be denied by the Administrative Agent and (b) any request by
the Company for a Eurodollar Rate Contract Advance as part of a US Contract
Advance shall be deemed to be a request for a US Alternate Base Rate Advance or,
if as part of a Canadian Contract Advance, shall be deemed to be a request for a
Canadian Alternate Base Rate Advance.
SECTION 2.10. Increased Costs; Increased Capital. (a) If due to either
(i) the introduction of or any change after the date hereof (other than any
change by way of imposition or increase of reserve requirements included in the
Eurodollar Rate Reserve Percentage) in or in the interpretation of any law or
regulation or (ii) the compliance with any guideline or request received from
any central bank or other governmental authority after the date hereof (whether
or not having the force of law), there shall be any increase in the cost to any
Bank of agreeing to make or making, funding, or maintaining Eurodollar Rate
Advances or Acceptances, then the applicable Borrower shall from time to time,
upon demand by such Bank (with a copy of such demand to the Administrative
Agent), pay to the Administrative Agent for the account of such Bank additional
amounts sufficient to compensate such Bank for such increased cost. Increased
costs shall not include income, stamp, or other taxes, imposts, duties, charges,
fees, deductions, or withholdings imposed, levied, collected, withheld, or
assessed by the United States of America or Canada or any political subdivision
or taxing authority thereof or therein (including Puerto Rico) or of the country
in which any Bank's principal office or Applicable Lending Office may be located
or any political subdivision or taxing authority thereof or therein. Each Bank
agrees that, upon the occurrence of any event giving rise to a demand under this
Section 2.10(a) with respect to the Eurodollar Lending Office of such Bank, it
will, if requested by the applicable Borrower and to the extent permitted by law
or the relevant governmental authority, endeavor in good faith and consistent
with its internal policies to avoid or minimize the increase in costs resulting
from such event by endeavoring to change its Eurodollar Lending Office;
provided, however, that such avoidance or minimization can be made in such a
manner that such Bank, in its sole determination, suffers no economic, legal, or
regulatory disadvantage. A certificate as to the amount of and specifying in
reasonable detail the basis for such increased cost, submitted to the Company
and the Administrative Agent by such Bank, shall constitute such demand and
shall, in the absence of manifest error, be conclusive and binding for all
purposes.
(b) If either (i) the introduction after the date hereof of, or any
change after the date hereof in or in the interpretation of, any law or
regulation or (ii) the compliance by any Bank with any guideline or request
received from any central bank or other governmental authority after the date
hereof (whether or not having the force of law), affects or would affect the
amount of capital required or expected to be maintained by such Bank or any
corporation controlling such Bank and such Bank determines that the amount of
such capital is increased by or based
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upon the existence of its Advances or Commitment, then the applicable Borrower
shall, from time to time, upon demand by such Bank (with a copy of such demand
to the Administrative Agent), immediately pay to the Administrative Agent for
the account of such Bank additional amounts sufficient to compensate such Bank
to the extent that such Bank determined such increase in capital to be allocable
to the existence of such Bank's Advances or Commitment. A certificate as to the
amount of such increased capital and specifying in reasonable detail the basis
therefor, submitted to the Company and the Administrative Agent by such Bank,
shall constitute such demand and shall, in the absence of manifest error, be
conclusive and binding for all purposes. Each Bank shall use all reasonable
efforts to mitigate the effect upon the applicable Borrower of any such
increased capital requirement and shall assess any cost related to such
increased capital on a nondiscriminatory basis among the applicable Borrower and
other borrowers of such Bank to which it applies and such Bank shall not be
entitled to demand or be compensated for any increased capital requirement
unless it is, as a result of such law, regulation, guideline, or request, such
Bank's policy generally to seek to exercise such rights, where available,
against other borrowers of such Bank.
(c) Notwithstanding the foregoing provisions of this Section 2.10, (i)
the applicable Borrower shall not be required to reimburse any Bank for any
increased costs incurred more than three months prior to the date that such Bank
notifies the Company in writing thereof and (ii) in the event any Bank grants a
participation or assignment in an Advance pursuant to Section 8.07, such
Borrower shall not be obligated to reimburse for increased costs with respect to
such Advance to the extent that the aggregate amount thereof exceeds the
aggregate amount for which such Borrower would have been obligated if such Bank
had not made such participation or assignment.
SECTION 2.11. Additional Interest on Eurodollar Rate Advances. Each
Borrower shall pay to the Administrative Agent for the account of each Bank any
costs which such Bank determines are attributable to such Bank's compliance with
regulations of the Board (or of any other governmental authority having or
asserting lawful jurisdiction over any Canadian Bank) requiring the maintenance
of reserves with respect to liabilities or assets consisting of or including
Eurocurrency Liabilities. Such costs shall be paid to the Administrative Agent
for the account of such Bank in the form of additional interest on the unpaid
principal amount of each Eurodollar Rate Advance of such Bank to such Borrower,
from the date of such Advance until such principal amount is paid in full, at an
interest rate per annum equal at all times to the remainder obtained by
subtracting (i) the Eurodollar Rate for the applicable period for such Advance
from (ii) the rate obtained by dividing such Eurodollar Rate by a percentage
equal to 100% minus the Eurodollar Rate Reserve Percentage of such Bank for such
period, payable on each date on which interest is payable on such Advance. Such
additional interest shall be determined by such Bank and notified to the Company
and the Administrative Agent. A certificate setting forth the amount of such
additional interest, submitted to the Company and the Administrative Agent by
such Bank, shall be conclusive and binding for all purposes, absent manifest
error.
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SECTION 2.12. Change in Legality. If any Bank (as used in this
paragraph, a "Notifying Bank") shall, at least three Business Days before the
date of any requested Borrowing consisting of Eurodollar Rate Advances notify
the Administrative Agent that the introduction of or any change in or in the
interpretation of any law or regulation makes it unlawful, or that any central
bank or other governmental authority asserts that it is unlawful, for such
Notifying Bank or its Applicable Lending Office to perform its obligations
hereunder to make, fund or maintain Eurodollar Rate Advances hereunder, the
right of the Company to select Advances of such Type from such Notifying Bank
for such Borrowing or any subsequent Borrowing shall be suspended until such
Notifying Bank shall notify the Administrative Agent that the circumstances
causing such suspension no longer exist; provided that during the period when
such obligation of such Notifying Bank is suspended, any Borrowing consisting of
Eurodollar Rate Advances shall not exceed the Commitments of the applicable
Class of the other Banks less the aggregate amount of any Advances (including
Competitive Advances) of the applicable Class then outstanding, and shall be
made by the other Banks pro rata according to their respective Commitments of
the applicable Class.
SECTION 2.13. Payments and Computations. (a) Each Borrower shall make
each payment to be made by it hereunder from a bank account of such Borrower
located in the United States (in the case of the Company) or Canada (in the case
of a Canadian Borrower) not later than 11:00 a.m. (New York City time) on the
day when due to the Administrative Agent at its address referred to in Section
8.02 (or, in the case of payments by a Canadian Borrower, to an account in
Canada designated by the Administrative Agent for such purpose) in same-day
funds. The Administrative Agent will promptly thereafter cause to be distributed
like funds to the Banks entitled thereto for the account of their respective
Applicable Lending Offices, in each case to be applied in accordance with the
terms of this Agreement. All payments required to be made by any Borrower
hereunder (whether of principal, interest or otherwise) shall be made (i) in the
case of principal of or interest on any US Advance, Eurodollar Rate Advance and
Canadian Alternate Base Rate Advance, in US Dollars, (ii) in the case of
principal of or interest on any other Canadian Advance, in Canadian Dollars,
(iii) in the case of fees, in US Dollars (or in the case of Acceptance Fees,
Canadian Dollars), (iv) in the case of payments under Section 8.04(b) in respect
of any Advance, in the currency in which such Advance is denominated, (v) in the
case of any indemnification or expense reimbursement obligation, in US Dollars
or, if requested by a Canadian Bank with respect to any such payment due to it,
in Canadian Dollars, or (vi) in all other cases, US Dollars.
(b) Subject to Section 8.19, all computations of interest based on the
US Alternate Base Rate or Canadian Alternate Base Rate shall be made by the
Administrative Agent on the basis of a year of 365 or 366 days, as the case may
be, when determined by reference to the US Prime Rate or the US Base Rate,
respectively, and on the basis of a year of 360 days at all other times; and all
computations of fees and of interest based on the Eurodollar Rate or the Fixed
Rate shall be made by the Administrative Agent on the basis of a year of 360
days, in each case for the actual number of days (including the first day but
excluding the last day) occurring
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in the period for which such interest or fees are payable. Each determination by
the Administrative Agent of an interest rate hereunder shall be conclusive and
binding for all purposes, absent manifest error.
(c) Whenever any payment hereunder shall be stated to be due on a day
other than a Business Day, such payment shall be made on the next succeeding
Business Day, and such extension of time shall be included in the computation of
payment of interest or fees, as the case may be; provided, however, that if such
extension would cause payment of interest on or principal of Eurodollar Rate
Advances to be made in the next following calendar month, such payment shall be
made on the next preceding Business Day.
(d) Unless the Administrative Agent shall have received notice from the
Company prior to the date on which any payment is due to the Banks hereunder
that the applicable Borrower will not make such payment in full, the
Administrative Agent may assume that the applicable Borrower has made such
payment in full to the Administrative Agent on such date and the Administrative
Agent may, in reliance upon such assumption, cause to be distributed to each
Bank on such due date an amount equal to the amount then due such Bank. If and
to the extent the applicable Borrower shall not have so made such payment in
full to the Administrative Agent, each Bank shall repay to the Administrative
Agent forthwith on demand such amount distributed to such Bank together with
interest thereon, for each day from the date such amount is distributed to such
Bank until the date such Bank repays such amount to the Administrative Agent, at
the Federal Funds Effective Rate (in the case of amounts payable in US Dollars)
or at the Canadian Prime Rate plus 1% (in the case of amounts payable in
Canadian Dollars).
(e) Each Bank shall maintain on its books a loan account in the name of
each Borrower in which shall be recorded all Advances made by such Bank to such
Borrower, the interest rate, the currency and the maturity date of each such
Advance and all payments of principal and interest made by each Borrower with
respect to such Advances. The obligation of each Borrower to repay the Advances
made by each Bank and to pay interest thereon shall be evidenced by the entries
from time to time made in the loan account of such Bank maintained pursuant to
this Section 2.13(e); provided that the failure to make an entry with respect to
an Advance shall not affect the obligations of any Borrower hereunder with
respect to such Advance. In case of any dispute, action or proceeding relating
to any Advance, the entries in such loan account shall be prima facie evidence
of the amount of such Advance and of any amounts paid or payable with respect
thereto.
(f) The Administrative Agent shall maintain on its books a set of
accounts in which shall be recorded all Advances made by the Banks to each
Borrower, the interest rates, the currencies and maturity dates of such Advances
and all payments of principal and interest made thereon. In case of any
discrepancy between the entries in the Administrative Agent's books and
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the entries in any Bank's books, such Bank's records shall be considered
correct, in the absence of manifest error.
SECTION 2.14. Taxes on Payments. (a) All payments made by each
Borrower under this Agreement shall be made free and clear of, and without
reduction for or on account of, any income, stamp, or other taxes, imposts,
duties, charges, fees, deductions, or withholdings, imposed, levied, collected,
withheld, or assessed by the United States of America or Canada (or by any
political subdivision or taxing authority thereof or therein) as a result of (i)
the introduction after the date hereof of any law, regulation, treaty,
directive, or guideline (whether or not having the force of law), or (ii) any
change after the date hereof in any law, regulation, treaty, directive, or
guideline (whether or not having the force of law), or (iii) any change after
the date hereof in the interpretation or application of any law, regulation,
treaty, directive, or guideline (whether or not having the force of law), or
(iv) any such taxes, imposts, duties, charges, fees, deductions, or withholdings
being imposed, levied, collected, withheld, or assessed at a greater rate than
the rate that would have been applicable had such an introduction or change not
been made, but only to the extent of the increase in such rate ("Withholding
Taxes"). If any Withholding Taxes are required to be withheld from any amounts
payable to or for the account of any Bank hereunder, the amounts so payable to
or for the account of such Bank shall be increased to the extent necessary to
yield to such Bank (after payment of all Withholding Taxes) interest or any such
other amounts payable hereunder at the rates or in the amounts payable to or for
the account of such Bank under this Agreement prior to such introduction or
change. Whenever any Withholding Tax is payable by any Borrower, as promptly as
possible thereafter, such Borrower shall send to the Administrative Agent, for
the account of such Bank, a certified copy of an original official receipt
showing payment thereof. If any Borrower fails to pay any Withholding Taxes when
due to the appropriate taxing authority or fails to remit to the Administrative
Agent, for the account of any Bank the required receipts or other required
documentary evidence, such Borrower shall indemnify such Bank or the
Administrative Agent for any incremental taxes, interest, or penalties
(including any Withholding Taxes imposed or asserted on or attributable to
amounts payable under this Section) that may become payable by such Bank or the
Administrative Agent as a result of any such failure.
(b) At least four Business Days prior to the first Borrowing or, if the
first Borrowing does not occur within thirty days after the date of execution of
this Agreement, by the end of such thirty-day period, each Bank (other than a
Canadian Bank) that is organized outside the United States agrees that it will
deliver to the Company and the Administrative Agent two duly completed copies of
United States Internal Revenue Service Form 1001 (or such other documentation or
information as may, under applicable United States Federal income tax statutes
or regulations, be required in order to claim an exemption or reduction from
United States income tax withholding by reason of an applicable treaty with the
United States, such documentation or other information being hereafter referred
to as "Form 1001") or Form 4224 (or such other documentation or information as
may, under applicable United States Federal income tax statutes or regulations,
be required in order to claim an exemption from United States
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income tax withholding for income that is effectively connected with the conduct
of a trade or business within the United States, such documentation or other
information being hereafter referred to as "Form 4224"), as the case may be, in
the case of a Bank claiming exemption from US Federal withholding tax under
Section 871(h) or 881(c) of the Code with respect to payments of "portfolio
interest", a Form W-8, or any subsequent versions thereof or successors thereto
(and, if such Bank delivers a Form W-8, a certificate representing that such
Bank is not a bank for purposes of Section 881(c) of the Code, is not a
10-percent shareholder of the Borrower (within the meaning of Section
871(h)(3)(B) of the Code) and is not a controlled foreign corporation related to
the Borrower (within the meaning of Section 864(d)(4) of the Code)), indicating
in each case that such Bank is either entitled to receive payments under this
Agreement without deduction or withholding of any United States Federal income
taxes or, as the case may be, is subject to such limited deduction or
withholding. Each Bank which delivers to the Company and the Administrative
Agent such forms pursuant to the next preceding sentence further undertakes to
deliver to the Company and the Administrative Agent two further copies of such
forms or successor applicable form or certificate, as the case may be, as and
when the previous form filed by it hereunder shall expire or shall become
incomplete or inaccurate in any respect, unless in any of such cases an event
has occurred prior to the date on which any such delivery would otherwise be
required which renders such form inapplicable.
(c) If at any time any Bank by reason of payment by any Borrower of any
Withholding Taxes obtains a credit against, or return or reduction of, any tax
payable by it, or any other currently realized tax benefit, which it would not
have enjoyed but for such payment ("Tax Benefit"), such Bank shall thereupon pay
to such Borrower the amount which such Bank shall certify to be the amount that
after payment, will leave such Bank in the same economic position it would have
been in had it received no such Tax Benefit ("Equalization Amount"); provided,
however, that if such Bank shall subsequently determine that it has lost the
benefit of all or a portion of such Tax Benefit, such Borrower shall promptly
remit to such Bank the amount certified by such Bank to be the amount necessary
to restore such Bank to the position it would have been in if no payment had
been made pursuant to this Section 2.14(c); provided further, however, that if
such Bank shall be prevented by applicable law from paying such Borrower all or
any portion of the Equalization Amount owing to such Borrower such payment need
not be made to the extent such Bank is so prevented and the amount not paid
shall be credited to the extent lawful against future payment owing to such
Bank; provided further, however, that the aggregate of all Equalization Amounts
paid by any Bank to any Borrower shall in no event exceed the aggregate of all
amounts paid by such Borrower to such Bank in respect of Withholding Taxes plus,
in the case of a Tax Benefit that occurs by reason of a refund interest actually
received from the relevant taxing authority with respect to such refund. A
certificate submitted in good faith by any Bank pursuant to this Section 2.14(c)
shall be deemed conclusive absent manifest error.
(d) In the event a Bank shall become aware that any Borrower is
required to pay any additional amount to it pursuant to Section 2.14(a), such
Bank shall promptly notify the
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Administrative Agent and the Company of such fact and shall use reasonable
efforts, consistent with legal and regulatory restrictions, to change the
jurisdiction of its Applicable Lending Office if the making of such change (i)
would avoid the need for, or reduce the amount of, any such additional amounts
that may thereafter accrue, (ii) would not, in the good faith determination of
such Bank, be disadvantageous for regulatory or competitive reasons to such
Bank, and (iii) would not require such Bank to incur any cost or forego any
economic advantage for which the applicable Borrower shall not have agreed to
reimburse and indemnify such Bank.
(e) Notwithstanding the foregoing provisions of this Section 2.14, in
the event any Bank grants a participation in any Advance pursuant to Section
8.07, no Borrower shall be obligated to pay any taxes, imposts, duties, charges,
fees, deductions, or withholdings to the extent that the aggregate amount
thereof exceeds the aggregate amount for which such Borrower would have been
obligated if such Bank had not granted such participation.
SECTION 2.15. Sharing of Payments, Etc. If any Bank or Canadian Bank,
as applicable, shall obtain any payment (whether voluntary, involuntary, through
the exercise of any right of setoff or otherwise) on account of the Contract
Advances made, or Drafts accepted, by it (other than pursuant to Sections 2.10,
2.14, 2.16, 8.04, or 8.07(g) hereof) in excess of its ratable share of payments
on account of the Contract Advances or Drafts, as applicable, obtained by all
the Banks or Canadian Banks, as applicable, then such Bank shall forthwith
purchase from the other Banks or Canadian Banks, as applicable, through the
Administrative Agent such participations in the Contract Advances made, or
Drafts accepted, by them as shall be necessary to cause such purchasing Bank to
share the excess payment ratably with each of them; provided, however, that, if
all or any portion of such excess payment is thereafter recovered from such
purchasing Bank, such purchase from each Bank or Canadian Bank, as applicable,
shall be rescinded, and such Bank shall repay to the purchasing Bank the
purchase price to the extent of such recovery, together with an amount equal to
such Bank's ratable share (according to the proportion that (i) the amount of
such Bank's required repayment bears to (ii) the total amount so recovered from
the purchasing Bank) of any interest or other amount paid or payable by the
purchasing Bank in respect of the total amount so recovered. Each Borrower
agrees that any Bank or Canadian Bank, as applicable, so purchasing a
participation from another Bank or Canadian Bank, as applicable, pursuant to
this Section 2.15 may, to the fullest extent permitted by law, exercise all its
rights of payment (including the right of setoff) with respect to such
participation as fully as if such Bank were the direct creditor of such Borrower
in the amount of such participation. Nothing herein shall require any payment
which will result in any adverse withholding tax consequence to any Borrower in
any jurisdiction.
SECTION 2.16. Removal of a Bank. The Company shall have the right, by
giving at least 15 Business Days' prior notice in writing to the affected Bank
and the Administrative Agent, at any time when no Event of Default and no event
which with the passage of time or the giving of notice or both would become an
Event of Default has occurred and is then continuing, to remove as a party
hereto any Bank having a credit rating of C/D (or its
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equivalent) or lower by Thomson BankWatch, Inc. (or any successor thereto), such
removal to be effective as of the date specified in such notice from the Company
(a "Removal Date"), which date, for any Eurodollar Rate Contract Advance, shall
be the last day of an Interest Period and, for any Competitive Advance or
Acceptance, shall be the maturity date of such Competitive Advance or
Acceptance; provided that no such Bank may be removed if it does not have a
Commitment at the time. On any Removal Date, the Borrowers shall repay all the
outstanding Advances of the affected Bank applicable to such Removal Date,
together with all accrued interest, fees, and all other amounts owing hereunder
to such Bank. Upon each such Removal Date and receipt of the related payment
referred to above, the Commitment relating to the Advances so paid on such
Removal Date, together with all unused Commitment, of such affected Bank shall
terminate, and such Bank shall cease thereafter to constitute a Bank hereunder.
The Company shall have the right to offer to one or more Banks the right to
increase their Commitments up to, in the aggregate for all such increases, the
Commitment of any Bank which is removed pursuant to the foregoing provisions of
this Section 2.16 (such Commitment being herein called an "Unallocated
Commitment") effective on the relevant Removal Date, it being understood that no
Bank shall be obligated to increase its Commitment in response to any such
offer. The Company shall also have the right to offer all or any portion of an
Unallocated Commitment to one or more Eligible Assignees not parties hereto
having a credit rating higher than C/D (or its equivalent) by Thomson BankWatch,
Inc. (or any successor thereto), and, upon each such bank's acceptance of such
offer and execution and delivery of an instrument agreeing to the terms and
conditions hereof (including, without limitation, the provisions of Section 8.07
regarding Bank assignments), each such bank shall become a Bank hereunder with a
Commitment in an amount specified in such instrument. The obligations of the
Borrowers described in Sections 2.10, 8.04, and 8.15 shall survive for the
benefit of any Bank removed pursuant to this Section 2.16 notwithstanding such
removal.
SECTION 2.17. Canadian Borrowers; Canadian Commitments. (a) The
Company may at any time designate one or more of its wholly-owned Subsidiaries
organized under the laws of Canada or any jurisdiction therein as a Canadian
Borrower in accordance with this Section. Any such designation shall be made by
written notice to the Administrative Agent signed on behalf of the Company and
the Canadian Borrower designated therein and shall contain an undertaking, in
form reasonably satisfactory to the Administrative Agent, on behalf of such
Canadian Borrower to be bound by the provisions of this Agreement applicable to
such Canadian Borrower. The Company also may at any time terminate the
designation of any Canadian Borrower as a Borrower hereunder by written notice
to the Administrative Agent; provided, however, that any such termination shall
not be made at a time when any Canadian Advances to such Canadian Borrower are
outstanding and, in any event, shall not affect such Canadian Borrower's
liability for any of its Obligation hereunder.
(b) The Company may on each March 31, June 30, September 30 and
December 31, by written notice to the Administrative Agent given not less than
ten Business Days prior to the end of the applicable quarter, allocate or
reallocate the Commitments of
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Canadian Banks hereunder and, if applicable, the Designated Bank Affiliates,
between US Commitments and Canadian Commitments of Canadian Schedule I Banks or
Canadian Schedule II Banks and their Designated Bank Affiliates, as the case may
be; provided, however, that (i) the sum of any US Commitment and Canadian
Commitment of any Canadian Schedule I Bank, or the sum of the Canadian
Commitment of any Canadian Schedule II Bank and US Commitment of its Designated
Bank Affiliate, shall not at any time exceed its Commitment, (ii) the aggregate
amount of the Canadian Commitments shall not at any time exceed the Maximum
Canadian Allocation Amount and (iii) after giving effect to any such allocation
or reallocation (A) the Canadian Exposure shall not exceed the Canadian
Commitments, (B) the aggregate principal amount of outstanding US Advances shall
not exceed the US Commitments, (C) the Assigned Dollar Value of the aggregate
principal amount of outstanding Canadian Contract Advances of any Canadian Bank
shall not exceed its Canadian Commitment and (D) the aggregate principal amount
of outstanding US Contract Advances of any Canadian Schedule I Bank or of any
Designated Bank Affiliate shall not exceed its US Commitment. Allocations and
reallocations of Commitments of Canadian Schedule I Banks and Canadian Schedule
II Banks and their Designated Bank Affiliates pursuant to this Section shall be
made ratably among the Canadian Banks in accordance with their respective
Maximum Canadian Commitment Amounts.
(c) The Administrative Agent shall notify the Banks of any designation
by the Company of a Canadian Borrower or termination of such designation, or any
allocation or reallocation of Commitments of Canadian Banks, promptly following
receipt of notice thereof from the Company.
SECTION 2.18. Canadian Banker's Acceptances. All Acceptances and
Acceptance Borrowings shall be made as provided in Annex I and the Canadian
Banks and Canadian Borrowers hereby agree to be bound by the terms of Annex I.
Annex I is incorporated herein by reference and forms a part of this Agreement.
ARTICLE III
Conditions of Lending
SECTION 3.01. Conditions Precedent to Closing. The obligations of the
Banks to make the initial Advances hereunder shall not become effective until
the date on which each of the following conditions is satisfied (or waived in
accordance with Section 8.01):
(a) The Administrative Agent (or its counsel) shall have received from
each party hereto either (i) a counterpart of this Agreement signed on
behalf of such party or (ii) written evidence satisfactory to the
Administrative Agent (which may include telecopy transmission of a signed
signature page of this Agreement) that such party has signed a counterpart
of this Agreement.
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(b) The Administrative Agent shall have received a favorable written
opinion (addressed to the Administrative Agent and the Banks and dated the
Closing Date) of (i) Joseph A. LaSala, Jr., counsel for the Company,
substantially in the form of Exhibit C-1 and (ii) Morgan Lewis & Bockius
LLP, New York counsel for the Company, substantially in the form of Exhibit
C-2, in each case covering such other matters relating to the Company, the
Loan Papers or the Transactions as the Majority Banks shall reasonably
request. The Company hereby requests such counsel to deliver such opinions.
(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
Company, the authorization of the Transactions and any other legal matters
relating to the Company, the Loan Papers 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 Closing Date and signed by the President, a Vice President or a
Financial Officer of the Company, confirming compliance with the conditions
set forth in paragraphs (a) and (b) of Section 3.02.
(e) The Administrative Agent shall have received all fees and other
amounts due and payable on or prior to the Closing Date, including, to the
extent invoiced, reimbursement or payment of all out-of-pocket expenses
required to be reimbursed or paid by the Company hereunder.
(f) All consents and approvals required to be obtained from any
governmental authority or other Person in connection with the Transactions
shall have been obtained, except to the extent that failure to obtain any
such consent or approval, individually or in the aggregate, could not
reasonably be expected to have a material adverse effect on the business,
assets, operations, financial condition or prospects of the Company and its
Subsidiaries, taken as a whole.
(g) The Previous Credit Agreements shall have been terminated and all
amounts outstanding thereunder shall have been or shall simultaneously be
repaid (or in the case of the banker's acceptances listed on Schedule V
hereto, shall be deemed to have been issued under this Agreement as provided
in paragraph (m) of Annex I attached hereto), except that the Credit
Agreement referred to in clause (d)(i) of the definition of Previous Credit
Agreements shall be terminated and all amounts outstanding thereunder shall
be repaid on or prior to December 1, 1998.
(h) There shall not be any litigation, administrative proceedings or
other legal or regulatory actions pending or threatened which individually
or in the aggregate (i)
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prevent or impose materially adverse conditions upon any of the Transactions
or (ii) could reasonably be expected to have a material adverse effect on
the business, assets, operations, financial condition or prospects of the
Company and its Subsidiaries, taken as a whole.
(i) The consummation of the Transactions shall not (i) violate any
applicable law, statute, rule or regulation or (ii) conflict with, or result
in a default under, or any right to terminate or renegotiate, any material
Debt or contract of the Company or any of its Subsidiaries.
(j) The Other Credit Agreements shall have become or shall
simultaneously become effective.
(k) The Administrative Agent shall have received counterparts of the
Guarantee Agreement signed on behalf of the Company.
The Administrative Agent shall notify the Company and the Banks of the Closing
Date, and such notice shall be conclusive and binding. Notwithstanding the
foregoing, the obligations of the Banks to make Advances hereunder shall not
become effective unless each of the foregoing conditions is satisfied (or waived
pursuant to Section 8.01) at or prior to 3:00 p.m., New York City time, on
November 4, 1998 (and, in the event such conditions are not so satisfied or
waived, the Commitments shall terminate at such time).
SECTION 3.02. Conditions Precedent to Each Borrowing. The obligation
of each Bank to make an Advance in connection with any Borrow (including
without limitation, the initial Borrowing) shall be subject to the further
conditions precedent that on the date of such Borrowing,
(i) Administrative Agent shall have received a Notice of Contract
Borrowing or Notice of Competitive Borrowing (or, in the case of a Canadian
Borrowing comprised of Acceptances, a Notice of Drawing), executed and
completed by a Financial Officer of the Company, and
(ii) the following statements shall be true (and each of the giving of
the applicable Notice of Contract Borrowing or Notice of Competitive
Borrowing (or, in the case of a Canadian Borrowing comprised of Acceptances,
a Notice of Drawing) and the acceptance by the applicable Borrower of the
proceeds of such Borrowing shall constitute a representation and warranty by
the Company that on the date of such Borrowing such statements are true):
(a) the representations and warranties contained in Article IV
(excluding for all Borrowings, other than the initial Borrowings, those
contained in
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subsections (f), (j), (k) and (l) thereof) are correct on and as of the
date of such Borrowing, before and after giving effect to such
Borrowing and to the application of the proceeds therefrom, as though
made on and as of such date; and
(b) no event has occurred and is continuing, or would result
from such Borrowing or from the application of the proceeds therefrom,
which constitutes an Event of Default.
SECTION 3.03. Conditions Precedent to Canadian Borrowings. The
obligation of each Canadian Bank to make a Canadian Advance to any Canadian
Borrower shall be subject to the further conditions precedent that (a) such
Canadian Borrower shall have become a Canadian Borrower in accordance with
Section 2.17 and shall not have ceased to be a Canadian Borrower and (b) in the
case of the initial Canadian Advance to any Canadian Borrower, the
Administrative Agent shall have received a certificate of status of such
Canadian Borrower, a certified copy of authorizing resolutions of such Canadian
Borrower, a certificate of incumbency of such Canadian Borrower, the constating
document of such Canadian Borrower, a legal opinion substantially in the form of
Exhibit C-3 hereto and such other documents, certifications and opinions as the
Administrative Agent or its counsel may reasonably request relating to the
organization and existence of such Canadian Borrower, the authorization of the
Transactions to be entered into by it and the validity and binding effect of
this Agreement upon such Canadian Borrower, all in form and substance
satisfactory to the Administrative Agent and its counsel.
ARTICLE IV
Representations and Warranties
The Company represents and warrants as follows:
(a) Each Borrower is a corporation duly organized, validly existing
and, in the case of the Company, in good standing under the laws of the
jurisdiction in which it is organized.
(b) The Transactions are within each Borrower's corporate powers, have
been duly authorized by all necessary corporate action, and do not
contravene (i) such Borrower's charter or by-laws or (ii) any law or any
contractual restriction binding on or affecting any Borrower.
(c) No authorization or approval or other action by, and no notice to
or filing with, any governmental authority, regulatory body, or other Person
is required for the due execution, delivery and performance by the Company
of this Agreement or the Guarantee
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Agreement or the consummation by any Borrower of the Transactions, except
such as have been duly obtained or made and are in full force and effect.
(d) This Agreement is the legal, valid and binding obligation of each
Borrower enforceable against such Borrower in accordance with its terms. The
Guarantee Agreement is the legal, valid and binding obligation of the
Company enforceable against the Company in accordance with its terms.
(e) (i) The statement of consolidated financial position of the Company
and its consolidated Subsidiaries as of December 31, 1997, and the related
statements of consolidated income and consolidated changes in common
stockholders' equity of the Company and its consolidated Subsidiaries for
the fiscal year then ended, copies of which have been furnished to each
Bank, fairly present the financial condition of the Company and its
consolidated Subsidiaries as at such date and present the financial
condition of the Company and its consolidated Subsidiaries for the period
ended on such date, all in accordance with generally accepted accounting
principles consistently applied.
(ii) The statement of consolidated financial position of the Company
and its consolidated Subsidiaries as of June 30, 1998, and the related
statements of consolidated income and consolidated changes in common
stockholders' equity of the Company and its consolidated Subsidiaries for
the fiscal quarter then ended, copies of which have been furnished to each
Bank, fairly present the financial condition of the Company and its
consolidated Subsidiaries as at such date and present the financial
condition of the Company and its consolidated Subsidiaries for the period
ended on such date, all in accordance with generally accepted accounting
principles consistently applied, and since June 30, 1998, there has been no
material adverse change in such condition or operations.
(f) There is no pending or threatened action or proceeding affecting
the Company or any of its consolidated Subsidiaries before any court,
governmental agency or arbitrator, (i) which purports to affect the
legality, validity or enforceability of the Transactions or (ii) except as
set forth in public documents filed with the Securities and Exchange
Commission or otherwise disclosed publicly on or prior to the Closing Date,
which may be reasonably expected to materially adversely affect the
financial condition or operations of the Company or any of its Subsidiaries,
taken as a whole.
(g) After applying the proceeds of each Advance, not more than 25% of
the value of the assets of the Company and its Subsidiaries (as determined
in good faith by the Company) that are subject to Section 5.02(a) will
consist of or be represented by Margin Stock.
(h) The Company is not engaged in the business of extending credit for
the purpose of purchasing or carrying Margin Stock and no proceeds of any
Advance will be
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used for any purpose which violates the provisions of the regulations of the
Board. If requested by any Bank or the Administrative Agent, the Company
will furnish to the Administrative Agent and each Bank a statement in
conformity with the requirements of Federal Reserve Form U-1 referred to in
Regulation U, the statements made in which shall be such, in the opinion of
each Bank, as to permit the transactions contemplated hereby in accordance
with Regulation U.
(i) No Termination Event has occurred nor is reasonably expected to
occur with respect to any Plan which may materially adversely affect the
financial condition or operations of the Company and its Subsidiaries, taken
as a whole. Neither the Company nor any of its ERISA Affiliates has incurred
nor reasonably expects to incur any withdrawal liability under ERISA to any
Multiemployer Plan which may reasonably be expected to materially adversely
affect the financial condition or operations of the Company and its
Subsidiaries, taken as a whole. Schedule B (Actuarial Information) to the
1994 annual report (Form 5500 Series) with respect to each Plan, copies of
which have been filed with the Internal Revenue Service and furnished to
each Bank, is complete and accurate in all material respects and in all
material respects fairly presents the funding status of each Plan. No
Reportable Event has occurred and is continuing with respect to any Plan
which may materially adversely affect the financial condition or operations
of the Company and its Subsidiaries, taken as a whole.
(j) On the date of the initial Borrowing, and after giving effect to
the Transactions, the Company is Solvent. For purposes hereof, "Solvent"
means, as to a Person, that (i) the aggregate fair market value of such
Person's assets exceeds its liabilities (whether contingent, subordinated,
unmatured, unliquidated, or otherwise), (ii) such Person has sufficient cash
flow to enable it to pay its Debts as they mature, and (iii) such Person
does not have unreasonably small capital to conduct such Person's business.
In computing the amount of contingent liabilities at any time, for purposes
of determining solvency, it is intended that such liabilities will be
computed at the amount which, 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.
(k) Except as disclosed in public documents filed with the Securities
and Exchange Commission or otherwise disclosed publicly on or prior to the
Closing Date, neither the Company nor any Restricted Subsidiary is a party
to a material transaction with any of its Affiliates, other than
transactions in the ordinary course of business and upon fair and reasonable
terms not materially less favorable than the Company or such Restricted
Subsidiary could obtain or could become entitled to in an arm's-length
transaction with a Person that was not its Affiliate.
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(l) The proportion that the combined EBITDAX of the Company and the
Principal Subsidiaries bears to the consolidated EBITDAX for the Company and
its Subsidiaries is not less than 80%.
(m) Any reprogramming required to permit the proper functioning, in and
following the year 2000, of (i) the Company's and its Subsidiaries' computer
systems and (ii) equipment containing embedded microchips (including systems
and equipment supplied by others) and the testing of all such systems and
equipment, as so reprogrammed, will be completed by September 1, 1999. The
cost to the Company and the Subsidiaries of such reprogramming and testing
and of the reasonably foreseeable consequences of year 2000 to the Company
and its Subsidiaries (including, without limitation, reprogramming errors)
will not, taken as a whole, result in an Event of Default or a material
adverse effect on the Company and its Subsidiaries taken as a whole. Except
for such of the reprogramming referred to in the preceding sentence as may
be necessary, the computer and management information systems of the Company
and its Subsidiaries are and, with ordinary course upgrading and
maintenance, will continue for the term of this Agreement to be, sufficient
to permit the Company and its Subsidiaries to conduct their respective
businesses without material adverse effect on the Company and its
Subsidiaries taken as a whole.
ARTICLE V
Covenants of the Company
SECTION 5.01. Affirmative Covenants. So long as any Advance shall
remain unpaid or any Bank shall have any Commitment hereunder, the Company will,
and, in the case of Section 5.01(a), will cause its Subsidiaries to, unless the
Majority Banks shall otherwise consent in writing:
(a) Keep Books; Corporate Existence; Maintenance of Properties;
Compliance with Laws; Insurance.
(i) keep proper books of record and account, all in accordance
with generally accepted accounting principles;
(ii) preserve and keep in full force and effect its existence,
and preserve and keep in full force and effect its licenses, rights and
franchises to the extent it deems necessary to carry on its business;
(iii) maintain and keep, or cause to be maintained and kept,
its properties in good repair, working order and condition, and from
time to time make or cause to
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be made all needful and proper repairs, renewals, replacements and
improvements, in each case to the extent it deems necessary to carry on
its business;
(iv) use its reasonable efforts to comply in all material
respects with all material applicable statutes, regulations, and orders
of, and all material applicable restrictions imposed by, any
governmental agency in respect of the conduct of its business and the
ownership of its properties, to the extent it deems necessary to carry
on its business, except such as are being contested in good faith by
appropriate proceedings;
(v) insure and keep insured its properties in such amounts
(and with such self insurance and deductibles) as it deems necessary to
carry on its business and to the extent available on premiums and other
terms which the Company or any Subsidiary, as the case may be, deems
appropriate. Any of such insurance may be carried by, through, or with
any captive or affiliated insurance company or by way of self-insurance
as the Company or any Subsidiary, as the case may be, deems
appropriate; and
(vi) use, and cause the Canadian Borrowers to use, the
proceeds of Advances for general corporate purposes (including the
replacement of the Previous Credit Agreements) and to repurchase or
refinance, from time to time, commercial paper issued by any of the
Borrowers.
Nothing in this subsection shall prohibit the Company or any of its Subsidiaries
from discontinuing any business, forfeiting any license, right or franchise or
discontinuing the operation or maintenance of any of its properties to the
extent it deems appropriate in the conduct of its business.
(b) Reporting Requirements. Furnish to the Banks:
(i) as soon as available and in any event within 60 days after
the end of each of the first three quarters of each fiscal year of the
Company, a statement of the consolidated financial condition of the
Company and its consolidated Subsidiaries as at the end of such quarter
and the related statements of income and retained earnings of the
Company and its consolidated Subsidiaries for the period commencing at
the end of the previous fiscal year and ending with the end of such
quarter, certified by a principal financial or accounting officer of
the Company; provided that the Company may deliver, in lieu of the
foregoing, the quarterly report of the Company for such fiscal quarter
on Form 10-Q filed with the Securities and Exchange Commission or any
governmental authority succeeding to the functions of such Commission,
but only so long as the financial statements
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contained in such quarterly report on Form 10-Q relate to the same
companies and are substantially the same in content as the financial
statements referred to in the preceding provisions of this clause (i);
(ii) as soon as available and in any event within 90 days
after the end of each fiscal year of the Company, a copy of the annual
report for such year for the Company and its Subsidiaries, containing
the audited consolidated financial statements of the Company and its
consolidated Subsidiaries for such year and accompanied by an auditors'
report of Deloitte & Touche or other independent public accountants of
nationally recognized standing that such financial statements were
prepared in accordance with generally accepted accounting standards and
present fairly the consolidated financial condition of the Company and
its consolidated Subsidiaries and results of operations of the Company
and its consolidated Subsidiaries;
(iii) promptly after the sending or filing thereof, copies of
all reports which the Company sends to its stockholders generally, and
copies of all reports and registration statements (without exhibits)
which the Company files with the Securities and Exchange Commission or
any national securities exchange (other than registration statements
relating to employee benefit plans);
(iv) promptly after the filing or receiving thereof, copies of
any notices of any of the events set forth in Section 4043(b) of ERISA
or the regulations thereunder which the Company or any Subsidiary files
with the PBGC, or which the Company or any Subsidiary receives from the
PBGC to the effect that proceedings or other action by the PBGC is to
be instituted;
(v) such other information respecting the condition or
operations, financial or otherwise, of the Company or any of its
Subsidiaries as any Bank through the Administrative Agent may from time
to time reasonably request; and
(vi) at any time the Company is not a publicly-reporting
company, upon the request of Administrative Agent (and in a form
acceptable to Administrative Agent), such information respecting the
condition or operations, financial or otherwise, of the Company or any
of its Subsidiaries as the Company would have included in any reports
filed with the Securities and Exchange Commission if it had continued
to be a publicly-reporting company.
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(c) Notices. Promptly give notice to the Administrative Agent and each
Bank:
(i) of the occurrence of any Event of Default or any event
which, with the giving of notice or the passage of time, or both, would
become an Event of Default; and
(ii) of the commencement of any litigation, investigation, or
proceeding affecting the Company or any of its Subsidiaries before any
court, governmental authority or arbitrator which, in the reasonable
judgment of the Company, could have a material adverse effect on the
business, operations, property, or financial or other condition of the
Company and its Subsidiaries, taken as a whole.
Each notice pursuant to this subsection shall be accompanied by a statement of
the Company, setting forth details of the occurrence referred to therein and
stating what action the Company proposes to take with respect thereto.
(d) Certificates. Furnish to the Banks:
(i) concurrently with the delivery of the financial statements
referred to in Section 5.01(b)(ii), a letter signed by the independent
public accountants, certifying such financial statements to the effect
that, in the course of the examination upon which their report for such
fiscal year was based (but without any special or additional audit
procedures for that purpose other than review of the terms and
provisions of this Agreement), they did not become aware of any Event
of Default involving financial or accounting matters or any condition
or event which, after notice or lapse of time, or both, would
constitute such an Event of Default, or, if such accountants became
aware of any such Event of Default or other condition or event,
specifying the nature thereof; and
(ii) concurrently with the delivery of the financial
statements or Form 10-Q referred to in Sections 5.01(b)(i) and (ii), a
certificate of a Financial Officer of the Company, stating that, to the
best of such officer's knowledge, the Company during such period has
observed or performed, all of its covenants and other agreements, and
satisfied every condition, contained in this Agreement to be observed,
performed, or satisfied by it, and that such officer has obtained no
knowledge of any Event of Default or any event which, with notice or
lapse of time, or both, would become an Event of Default, except as
specified in such certificate.
SECTION 5.02. Negative Covenants. So long as any Advance
shall remain unpaid or any Bank shall have any Commitment hereunder, the Company
will not, without the written consent of the Majority Banks:
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(a) Liens, Etc. (i) Create, assume, incur or suffer to exist, or permit
any Subsidiary to create, assume, incur, or suffer to exist, any Lien upon
any capital stock or indebtedness, whether now owned or hereafter acquired,
of any Subsidiary, to secure any Debt of the Company or any other Person
(other than the Advances made hereunder), without in any such case making
effective provision whereby all of the Advances made hereunder shall be
directly secured equally and ratably with such Debt, excluding, however,
from the operation of the foregoing provisions of this paragraph (i) any
Lien upon capital stock or indebtedness of any corporation existing at the
time such corporation becomes a Subsidiary, or existing upon capital stock
or indebtedness of a Subsidiary at the time of acquisition of such capital
stock or indebtedness, and any extension, renewal, or replacement (or
successive extensions, renewals, or replacements) in whole or in part of any
such Lien; provided, however, that the principal amount of Debt secured
thereby shall not exceed the principal amount of Debt so secured at the time
of such extension, renewal, or replacement; and; provided further that such
Lien shall be limited to all or such part of the capital stock or
indebtedness which secured the Lien so extended, renewed, or replaced;
(ii) create, assume, incur, or suffer to exist, or permit any
Restricted Subsidiary to create, assume, incur or suffer to exist, any Lien
upon any Principal Property, whether owned or leased on the date hereof or
hereafter acquired, to secure any Debt of the Company or any other Person
(other than the Advances made hereunder), without in any such case making
effective provision whereby all of the Advances made hereunder shall be
directly secured equally and ratably with such Debt, excluding, however,
from the operation of the foregoing provisions of this paragraph (ii):
(A) any Lien upon property owned or leased by any
corporation existing at the time such corporation becomes a
Restricted Subsidiary, so long as such Lien covers, either (x)
the assets so encumbered immediately prior to an acquisition
of the Restricted Subsidiary or (y) assets substituted for any
assets described in clause (x) preceding (the "acquired
assets"), so long as the approximate fair market value of the
substituted assets does not exceed the approximate fair market
value of the acquired assets for which the substitution is
being made;
(B) any Lien upon property existing at the time of
acquisition thereof or to secure the payment of all or any
part of the purchase price thereof or to secure any Debt
incurred prior to, at the time of, or within 180 days after,
the acquisition of such property for the purpose of financing
all or any part of the purchase price thereof, so long as such
Lien is limited to the property so acquired;
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(C) any Lien upon property to secure all or any part
of the cost of exploration, drilling, development,
construction, alteration, repair, or improvement of all or any
part of such property, or Debt incurred prior to, at the time
of, or within 180 days after, the completion of such
exploration, drilling, development, construction, alteration,
repair, or improvement for the purpose of financing all or any
part of such cost;
(D) any Lien securing Debt of a Restricted Subsidiary
owing to the Company or to another Restricted Subsidiary;
(E) any Lien existing on the date of execution of
this Agreement and set forth on Schedule III hereto;
(F) Liens created in favor of Banks to secure the
Obligation;
(G) any Liens securing Debt of the Company under the
Other Credit Agreements, so long as the Banks are granted
Liens of equal priority upon any property to which such Liens
under the Other Credit Agreements attach; and
(H) any extension, renewal, or replacement (or
successive extensions, renewals, or replacements) in whole or
in part of any Lien referred to in the foregoing clauses (A)
to (G), inclusive; provided, however, that the principal
amount of Debt secured thereby shall not exceed the principal
amount of Debt so secured at the time of such extension,
renewal, or replacement; and; provided further that such Lien
shall be limited to all or such part of the property which
secured the Lien so extended, renewed, or replaced (plus
improvements on such property).
Notwithstanding the foregoing provisions of this paragraph (ii), the
Company may, and may permit any Restricted Subsidiary to, create,
assume, incur, or suffer to exist any Lien upon any Principal Property
which is not excepted by clauses (A) through (F), above, without
equally and ratably securing the Advances; provided that the aggregate
amount of Debt then outstanding secured by such Lien and all similar
Liens does not exceed the greater of (i) $150,000,000, and (ii) 10% of
the total consolidated stockholders' equity of the Company as shown on
the most recently audited consolidated balance sheet required to be
delivered to the Banks pursuant to Section 5.01(b)(ii). For the purpose
of this
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paragraph (ii), the following types of transactions shall not be deemed
to create a Lien to secure any Debt:
(A) the sale or other transfer of (y) any oil, gas,
or minerals in place for a period of time until, or in an
amount such that, the purchaser will realize therefrom a
specified amount of money (however determined) or a specified
amount of such oil, gas, or minerals, or (z) any other
interest in property of the character commonly referred to as
a "production payment"; and
(B) any Lien in favor of the United States of America
or any state thereof, or any other country, or any political
subdivision of any of the foregoing, to secure partial,
progress, advance or other payments pursuant to the provisions
of any contract or statute, or any Lien upon property of the
Company or a Restricted Subsidiary intended to be used
primarily for the purpose of, or in connection with, air or
water pollution control; provided that no such Lien shall
extend to any other property of the Company or a Restricted
Subsidiary.
(b) Debt. (i) Permit Union Pacific Resources Inc., a Canadian
corporation and wholly owned Subsidiary of the Company, or any of its
Subsidiaries (collectively, the "Designated Subsidiaries") to incur any Debt
which would result in the aggregate principal amount of Debt (other than
Debt to the Company or any other Subsidiary) of all the Designated
Subsidiaries, on a consolidated basis, exceeding US $1,400,000,000; and
(ii) permit any of its Subsidiaries (other than the Designated
Subsidiaries) to incur any Debt which would result in the aggregate
principal amount of Debt (other than (A) Debt to the Company or any other
Subsidiary and (B) Debt represented by the UPRCC Notes) of all Subsidiaries
(other than the Designated Subsidiaries), on a consolidated basis, exceeding
US $150,000,000; provided that in the event that the UPRCC Notes are issued,
the Company shall apply 75% of the Net Proceeds received by UPRCC from the
issuance of the UPRCC Notes to (x) permanently and ratably reduce the
Commitments and/or (y) repay Debt of the Designated Subsidiaries and reduce
the amount of the maximum permitted Debt of the Designated Subsidiaries as
set forth in clause (i) of this Section by an amount equal to such
repayment.
(c) Restriction on Fundamental Changes of the Company. Enter into any
transaction of merger or consolidation, or convey, transfer, or lease its
properties and assets substantially as an entirety to any Person, unless:
(i) either (A) the Company (in any merger or consolidation
involving the Company) is the surviving entity, or (B) the corporation
formed by such
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consolidation or into which the Company is merged or the Person which
acquires by conveyance or transfer, or which leases, the properties and
assets of the Company substantially as an entirety (the "Successor
Corporation") shall either (x) immediately after giving effect to such
merger, consolidation, conveyance, transfer or lease, have
then-effective ratings (or implied ratings) published by Moody's and
S&P applicable to such Successor Corporation's senior, unsecured,
non-credit-enhanced, long term indebtedness for borrowed money, which
ratings shall be Baa3 or higher (if assigned by Moody's) or BBB- or
higher (if assigned by S&P), or (y) be acceptable to Majority Banks in
their reasonable determination;
(ii) any Successor Corporation shall be a corporation
organized and existing under the laws of the United States of America,
any state thereof or the District of Columbia, and shall expressly
assume, by amendment to this Agreement executed by the Company and such
Successor Corporation and delivered to the Administrative Agent, the
due and punctual payment of the principal of, and interest on, the
Advances made hereunder and any other amounts payable under this
Agreement and the performance or observance of every covenant hereof on
the part of the Company or such Principal Subsidiary to be performed or
observed;
(iii) immediately after giving effect to such transaction, no
Event of Default and no event which, with notice or lapse of time, or
both, would become an Event of Default, shall have occurred and be
continuing;
(iv) if, as a result of any such consolidation or merger or
such conveyance, transfer or lease, properties or assets of the Company
or any Principal Subsidiary would become subject to a Lien which would
not be permitted by Section 5.02(a), the Company, the Principal
Subsidiary or the Successor Corporation, as the case may be, shall take
such steps as shall be necessary effectively to secure the Advances
made hereunder equally and ratably with (or prior to) all Debt secured
thereby; and
(v) the Company shall have delivered to the Administrative
Agent a certificate signed by an executive officer of the Company and a
written opinion of counsel satisfactory to the Administrative Agent
(who may be counsel to the Company), each stating that such transaction
and such amendment to this Agreement comply with this Section 5.02(c)
and that all conditions precedent herein provided for relating to such
transaction have been satisfied.
(d) Prohibition on Sale of UPRC Stock and Fundamental Changes of UPRC.
(i) Convey, sell, assign, or otherwise transfer (or permit any Subsidiary to
to so convey, sell,
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assign or transfer) all or any of the shares of capital stock of Union
Pacific Resources Company ("UPRC") or any Successor Subsidiary (as
hereinafter defined) now owned or hereafter acquired by the Company or any
Subsidiary and (ii) permit UPRC or any Successor Subsidiary (as hereinafter
defined) to enter into any transaction of merger or consolidation with, or
to convey, transfer or lease its properties substantially as an entirety to,
any Person, other than mergers or consolidations with, or conveyances,
transfers or leases to, the Company or any other Subsidiary. For purposes of
this subsection, "Successor Subsidiary" shall mean any Subsidiary which is
formed by any merger or consolidation of UPRC or which acquires by
conveyance, transfer or lease substantially all the properties of UPRC or
any Successor Subsidiary.
(e) Ratio of Maximum Total Debt to Consolidated EBITDAX. Permit the
ratio (calculated at the end of each fiscal quarter of the Company) that (i)
the aggregate amount of the consolidated Debt of the Company and its
consolidated Subsidiaries bears to (ii) consolidated EBITDAX of the Company
and its consolidated Subsidiaries (for the period of four consecutive fiscal
quarters then ended) to be more than 3.25:1.00. For purposes of determining
compliance with this covenant with respect to four-quarter periods ended on
or prior to December 31, 1998, data of Norcen shall be included in the
calculation of consolidated EBITDAX of the Company and its consolidated
Subsidiaries.
(f) Compliance with ERISA. To the extent that any event or action set
forth in clauses (i) through (iv) below would subject the Company and its
Subsidiaries, taken as a whole, to any material liability to the PBGC or
otherwise,
(i) terminate, or permit any Subsidiary to terminate, any
Plan;
(ii) engage in, or permit any Subsidiary to engage in, any
"prohibited transaction" (as defined in Section 4975 of the Code)
involving any Plan;
(iii) incur or suffer to exist, or permit any Subsidiary to
incur or suffer to exist, any "accumulated funding deficiency" (as
defined in Section 302 of ERISA), whether or not waived, involving any
Plan; or
(iv) allow or suffer to exist, or permit any Subsidiary to
allow or suffer to exist, any event or condition which presents a risk
of incurring a liability to the PBGC by reason of termination of any
Plan.
(g) Affiliate Transactions. Enter into (or permit any Restricted
Subsidiary to enter into) any material transaction with any of its
Affiliates, other than any transaction described in public documents filed
with the Securities and Exchange Commission or otherwise disclosed publicly
prior to the Closing Date, or any transaction in the ordinary course of
business and upon fair and reasonable terms not materially less favorable
than
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the Company or such Restricted Subsidiary could obtain or could be entitled
to in an arm's-length transaction with a Person that was not its Affiliate.
(h) Principal Subsidiaries. Permit the combined EBITDAX of the Company
and the Principal Subsidiaries to be less than 80% of the consolidated
EBITDAX of the Company and its Subsidiaries as shown on the most recent
consolidated income statement required to be delivered to the Banks pursuant
to Section 5.01(b).
ARTICLE VI
Events of Default
If any of the following events ("Events of Default") shall occur and be
continuing:
(a) any Borrower shall fail to pay any principal of any Advance when
the same becomes due and payable; provided that if any such failure shall
result from the malfunctioning or shutdown of any wire transfer or other
payment system employed by such Borrower to make such payment or from an
inadvertent error of a technical or clerical nature by such Borrower or any
bank or other entity employed by such Borrower to make such payment, no
Event of Default shall result under this paragraph (a) during the period
(not in excess of two Business Days) required by such Borrower to make
alternate payment arrangements; or
(b) any Borrower shall fail to pay any interest on any Advance or any
fee payable hereunder or under any agreement executed in connection herewith
when the same becomes due and payable and such failure shall remain
unremedied for ten days; or
(c) any representation or warranty made by the Company herein or by any
Borrower (or any of its officers) in connection with this Agreement
(including, without limitation, any representation or warranty deemed made
by the Company at the time of any Advance pursuant to Article III) shall
prove to have been incorrect in any material respect when made or deemed
made; or
(d) the Company shall fail to perform or observe any other term,
covenant, or agreement contained in this Agreement on its part to be
performed or observed if such failure shall remain unremedied for 30 days
after written notice thereof shall have been given to the Company by the
Administrative Agent or any Bank; or
(e) (i) the Company or any Principal Subsidiary shall fail to pay any
amount of principal or interest when due (or within any applicable grace
period) with respect to any Debt of the Company or any Principal Subsidiary,
whether such Debt now exists or shall
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hereafter be created, in an aggregate outstanding principal amount exceeding
$50,000,000 ("Material Debt") or (ii) an event of default as defined in any
mortgage, indenture, or instrument under which there may be issued, or by
which there may be secured or evidenced, any Debt of the Company or any
Principal Subsidiary, whether such Debt now exists or shall hereafter be
created, shall happen and shall result in Material Debt becoming or being
declared due and payable prior to the date on which it would otherwise
become due and payable, and such declaration shall not be rescinded or
annulled; or
(f) (i) any Borrower or any Principal Subsidiary shall commence any
case, proceeding, or other action, or make any filing (A) under any existing
or future law of any jurisdiction, domestic or foreign, relating to
bankruptcy, insolvency, reorganization, or relief of debtors, seeking to
have an order for relief entered with respect to it, or seeking to
adjudicate it a bankrupt or insolvent, or seeking reorganization,
arrangement, adjustment, winding-up, liquidation, dissolution, composition,
or other relief with respect to it or its debts, or (B) seeking appointment
of a receiver, trustee, custodian, or other similar official for it or for
all or any substantial part of its assets, or any Borrower or any Principal
Subsidiary shall make a general assignment for the benefit of its creditors;
or
(ii) there shall be commenced against any Borrower or any
Principal Subsidiary any case, proceeding or other action of a nature
referred to in clause (i) above which (A) results in the entry of an
order for relief or any such adjudication or appointment or (B) remains
undismissed, undischarged, or unbonded for a period of 60 days; or
(iii) there shall be commenced against any Borrower or any
Principal Subsidiary any case, proceeding, or other action seeking
issuance of a warrant of attachment, execution, distraint, or similar
process against all or any substantial part of its assets which results
in the entry of an order for any such relief which shall not have been
vacated, discharged, or stayed or bonded pending appeal within 60 days
from the entry thereof; or
(iv) any Borrower or any Principal Subsidiary shall take any
action in furtherance of or indicating its consent to, approval of, or
acquiescence in, any of the acts set forth in clause (i), (ii), or
(iii) above; or
(v) any Borrower or any Principal Subsidiary shall generally
not, or shall be unable to, or shall admit in writing its inability to,
pay its debts as they become due;
(g) a Material Plan shall fail to maintain the minimum funding
standards required by Section 412 of the Code for any plan year or a waiver
of such standard is sought or
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granted under Section 412(d), or a Material Plan is, shall have been, or
will be terminated or the subject of termination proceedings under ERISA, or
the Company or any of its Subsidiaries or any ERISA Affiliate has incurred
or will incur a liability to or on account of a Material Plan under Sections
4062, 4063, or 4064 of ERISA, and there shall result from any such event
either a liability or a material risk of incurring a liability to the PBGC
or a Material Plan (or a related trust) which will have a material adverse
effect upon the business, operations or the condition (financial or
otherwise) of the Company and its Subsidiaries, taken as a whole;
(h) the Company or any ERISA Affiliate shall have been notified by the
sponsor of a Multiemployer Plan that it has incurred withdrawal liability to
such Multiemployer Plan in an amount which, when aggregated with all other
amounts required to be paid to Multiemployer Plans in connection with
withdrawal liabilities (determined as of the date of such notification),
will have a material adverse effect upon the business, operations, or the
condition (financial or otherwise) of the Company and its Subsidiaries,
taken as a whole; or
(i) any "Event of Default" described in either of the Other Credit
Agreements shall occur;
then, and in any such event, the Administrative Agent
(i) shall at the request, or may with the consent, of the Majority
Banks, by notice to the Company, declare the obligation of each Bank to make
Advances to be terminated, whereupon the same shall forthwith terminate;
(ii) shall at the request, or may with the consent, of Banks owed at
least 51% of the then aggregate unpaid principal amount of the Advances
owing to Banks (based on the Assigned Dollar Values, in the case of Canadian
Advances denominated in Canadian Dollars), by notice to the Company, declare
the Advances, all interest thereon and all other amounts payable under this
Agreement to be forthwith due and payable, whereupon the Advances, all such
interest and all such amounts shall become and be forthwith due and payable,
without presentment, demand, protest, notice of intention to accelerate,
notice of acceleration, or further notice of any kind, all of which are
hereby expressly waived by the Borrowers;
(iii) shall at the request, or may with the consent, of Banks owed at
least 51% of the then aggregate unpaid principal amount of the Advances
owing to Banks (based on the Assigned Dollar Values, in the case of Canadian
Advances denominated in Canadian Dollars), require the Borrowers to deposit
with the Canadian Sub-Agent cash collateral, in Canadian Dollars in an
amount equal to the aggregate unmatured Acceptances then
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outstanding, to be held by the Canadian Sub-Agent as security for the
repayment of such outstanding Acceptances, and the Borrowers hereby agree to
make such deposits; and
(iv) shall at the request, or may with the consent, of the Majority
Banks, exercise any and all other legal and equitable rights afforded by the
Loan Papers, applicable law, or in equity, including, but not limited to,
the right to bring suit or other proceedings for specific performance or
otherwise in aid of any right granted to Administrative Agent or any Bank
hereunder; provided, however, that in the event of an actual or deemed entry
of an order for relief with respect to the Company or any of its
Subsidiaries under the Federal Bankruptcy Code, the Bankruptcy and
Insolvency Act (Canada) or the Companies' Creditors Arrangement Act
(Canada), (A) the obligation of each Bank to make Advances shall
automatically be terminated and (B) the Advances, all such interest and all
such amounts shall automatically become and be due and payable, without
presentment, demand, protest, or any notice of any kind, all of which are
hereby expressly waived by the Borrowers.
ARTICLE VII
The Administrative Agent
SECTION 7.01. Authorization and Action. Each Bank hereby appoints and
authorizes the Administrative Agent to take such action as administrative agent
on its behalf and to exercise such powers under this Agreement as are delegated
to the Administrative Agent by the terms hereof, together with such powers as
are reasonably incidental thereto. As to any matters not expressly provided for
by this Agreement (including, without limitation, enforcement or collection of
the amounts due hereunder), the Administrative Agent shall not be required to
exercise any discretion or take any action, but shall be required to act or to
refrain from acting (and shall be fully protected in so acting or refraining
from acting) upon the instructions of the Majority Banks, and such instructions
shall be binding upon all Banks and all holders of Advances; provided, however,
that the Administrative Agent shall not be required to take any action which
exposes the Administrative Agent to personal liability or which is contrary to
this Agreement or applicable law. The Administrative Agent agrees to give to
each Bank prompt notice of each notice given to it by the Company pursuant to
the terms of this Agreement.
SECTION 7.02. Administrative Agent's Reliance, Etc. Neither the
Administrative Agent nor any of its directors, officers, agents, or employees
shall be liable for any action taken or omitted to be taken by it or them under
or in connection with this Agreement,
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except for its or their own gross negligence or wilful misconduct. Without
limitation of the generality of the foregoing, the Administrative Agent:
(i) may consult with legal counsel (including counsel for the Company),
independent public accountants, and other experts selected by it and shall
not be liable for any action taken or omitted to be taken in good faith by
it in accordance with the advice of such counsel, accountants or experts;
(ii) makes no warranty or representation to any Bank and shall not be
responsible to any Bank for any statements, warranties, or representations
made in or in connection with this Agreement;
(iii) shall not have any duty to ascertain or to inquire as to the
performance or observance of any of the terms, covenants or conditions of
this Agreement on the part of any Borrower or to inspect the property
(including the books and records) of any Borrower;
(iv) shall not be responsible to any Bank for the due execution,
legality, validity, enforceability, genuineness, sufficiency or value of
this Agreement or any other instrument or document furnished pursuant
hereto; and
(v) shall incur no liability under or in respect of this Agreement by
acting upon any notice, consent, certificate or other instrument or writing
(which may be by telecopy, telegram or cable) believed by it to be genuine
and signed or sent by the proper party or parties.
SECTION 7.03. Administrative Agent and Affiliates. With respect to its
Commitment, Chase Bank of Texas, N.A. shall have the same rights and powers
under this Agreement as any other Bank, and may exercise the same as though it
were not the Administrative Agent and the term "Bank" or "Banks" shall, unless
otherwise expressly indicated, include Chase Bank of Texas, N.A. in its
individual capacity. Chase Bank of Texas, N.A. and its affiliates may accept
deposits from, lend money to, act as trustee under indentures of, and generally
engage in any kind of business with, the Company, any of its Subsidiaries and
any Person who may do business with or own securities of the Company or any such
Subsidiary, all as if Chase Bank of Texas, N.A. were not the Administrative
Agent and without any duty to account therefor to the Banks.
SECTION 7.04. Bank Credit Decision. Each Bank acknowledges that it
has, independently and without reliance upon the Administrative Agent or any
other Bank and based on the financial statements referred to in Article IV and
such other documents and information as it has deemed appropriate, made its own
credit analysis and decision to enter into this Agreement. Each Bank also
acknowledges that it will, independently and without reliance upon
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the Administrative Agent or any other Bank and based on such documents and
information as it shall deem appropriate at the time, continue to make its own
credit decisions in taking or not taking action under this Agreement.
SECTION 7.05. Indemnification. The Banks agree to indemnify the
Administrative Agent, acting in its agency capacity, (to the extent not
reimbursed by the Borrowers), ratably as computed as set forth below from and
against any and all liabilities, obligations, losses, damages, penalties,
actions, judgments, suits, costs, expenses or disbursements of any kind or
nature whatsoever which may be imposed on, incurred by or asserted against the
Administrative Agent in any way relating to, or arising out of, this Agreement
or any action taken or omitted by the Administrative Agent under this Agreement;
provided that no Bank shall be liable to the Administrative Agent for any
portion of such liabilities, obligations, losses, damages, penalties, actions,
judgments, suits, costs, expenses or disbursements resulting from the
Administrative Agent's gross negligence or wilful misconduct. Without limitation
of the foregoing, each Bank agrees to reimburse the Administrative Agent
promptly upon demand for its ratable share of any out-of-pocket expenses
(including counsel fees) incurred by the Administrative Agent in connection with
the preparation, execution, delivery, administration, modification, amendment or
enforcement (whether through negotiations, legal proceedings, or otherwise) of,
or legal advice in respect of rights or responsibilities under, this Agreement,
to the extent that the Administrative Agent is not reimbursed for such expenses
by the Borrowers. For purposes of this Section 7.05, ratable allocations among
the Banks shall be made (i) in respect of any demand by the Administrative Agent
prior to termination of the Commitments, according to the respective amounts of
their Commitments and (iii) thereafter according to the respective principal
amounts of the Advances then outstanding to them.
SECTION 7.06. Successor Administrative Agent. The Administrative Agent
may resign at any time by giving written notice thereof to the Banks and the
Company and may be removed at any time with or without cause by the Majority
Banks. Upon any such resignation or removal, the Majority Banks shall have the
right to appoint a successor Administrative Agent with the consent of the
Company (which consent shall not be required if at the time of such appointment
any Event of Default or an event which with the passage of time or the giving of
notice or both would become an Event of Default has occurred and is continuing).
If no successor Administrative Agent shall have been so appointed by the
Majority Banks, and shall have accepted such appointment, within 30 days after
the retiring Administrative Agent's giving of notice of resignation or the
Majority Banks' removal of the retiring Administrative Agent, then the retiring
Administrative Agent may, on behalf of the Banks, appoint a successor
Administrative Agent, which shall be a commercial bank organized or licensed
under the laws of the United States of America or of any state thereof and
having a combined capital and surplus of at least $500,000,000. Upon the
acceptance of any appointment as Administrative Agent hereunder by a successor
Administrative Agent, such successor Administrative Agent shall thereupon
succeed to and become vested with all the rights, powers, privileges and duties
of the
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retiring Administrative Agent, and the retiring Administrative Agent shall be
discharged from its duties and obligations under this Agreement. After any
retiring Administrative Agent's resignation or removal hereunder as
Administrative Agent, the provisions of this Article VII shall inure to its
benefit as to any actions taken or omitted to be taken by it while it was
Administrative Agent under this Agreement.
SECTION 7.07. Canadian Sub-Agent. The Administrative Agent may appoint
a sub-agent to perform the duties and responsibilities of the Administrative
Agent with respect to Canadian Advances. Any such sub-agent so appointed shall
be entitled to all of the benefits and immunities of the Administrative Agent
under this Agreement, including those granted under this Article VII, in its
capacity as such. The Administrative Agent hereby appoints Chase Bank of Texas,
N.A. of Canada as the initial sub-agent of the Administrative Agent pursuant to
this Section.
ARTICLE VIII
Miscellaneous
SECTION 8.01. Amendments, Etc. No amendment or waiver of any provision
of this Agreement nor consent to any departure by any Borrower therefrom, shall
in any event be effective, unless the same shall be in writing and signed by the
Majority Banks, and then such waiver or consent shall be effective only in the
specific instance and for the specific purpose for which given; provided,
however, that no amendment, waiver, or consent shall, unless in writing and
signed by all the Banks, do any of the following: (a) waive any of the
conditions specified in Section 3.01 or 3.02 (if and to the extent that the
Borrowing which is the subject of such waiver would involve an increase in the
aggregate outstanding amount of Advances over the aggregate amount of Advances
outstanding immediately prior to such Borrowing), (b) increase, or extend the
scheduled termination of, the Commitments of the Banks or subject the Banks to
any additional obligations, (c) reduce the principal of, or interest on, or
change the currency of payment of, the Advances or any fees or other amounts
payable hereunder, (d) postpone any date fixed for any payment of principal of,
or interest on, the Advances or any fees or other amounts payable hereunder, (e)
make any change which would alter the percentage of the Commitment, or of the
aggregate unpaid principal amount of the Advances, or the number of Banks, which
shall otherwise be required for the Banks or any of them to take any action
hereunder, or (f) amend this Section 8.01, and; provided further that no
amendment, waiver or consent shall, unless in writing and signed by the
Administrative Agent in addition to the Banks required above to take such
action, affect the rights or duties of the Administrative Agent under this
Agreement.
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SECTION 8.02. Notices, Etc. All notices and other communications
provided for hereunder shall be in writing (including telecopy, telegraphic or
cable communication) and telecopied, mailed, telegraphed, cabled or delivered,
if to the Company, at its address at P.O. Box 7, 801 Cherry Street, Fort Worth,
Texas 76101; if to any Canadian Borrower, to it in care of the Company; if to
any Bank listed on Schedule I hereto, at its Notice Address specified opposite
its name on Schedule I hereto; if to any other Bank, at its Domestic Lending
Office specified in the Assignment and Acceptance pursuant to which it became a
Bank; if to the Administrative Agent, to Chase Bank of Texas, N.A., c/o The
Chase Manhattan Bank, Loan and Agency Services Group, One Chase Manhattan Plaza,
8th Floor, New York, New York 10081, Attention: Muniram Appanna (Telecopy No.
(212) 552-5777) and (in the case of Competitive Advances) Chris Consomer
(Telecopy No. (212) 552-5627) and, in all cases, to Chase Bank of Texas, N.A.,
P.O. Box 660197, Dallas, Texas 75266-0197, Attention: Tim Perry (Telecopy No.
(214) 965-2536); if to the Canadian Sub-Agent (in the case of notices relating
to Canadian Advances), to The Chase Manhattan Bank of Canada, 100 King Street
West, Suite 6900, Toronto, Ontario, Canada M5X1A4, Attention: Funding Officer
(Telecopy No. (416) 216-4162); or, as to the Company, any Bank or the
Administrative Agent, at such other address as shall be designated by such party
in a written notice to the other parties and, as to each other party, at such
other address as shall be designated by such party in a written notice to the
Company and the Administrative Agent. All such notices and communications shall,
when telecopied, mailed, telegraphed, or cabled, be effective when sent by
telecopy, deposited in the mails, delivered to the telegraph company, or
delivered to the cable company, respectively, except that notices and
communications to the Administrative Agent pursuant to Article II or VII shall
not be effective until received by the Administrative Agent. The Administrative
Agent shall be entitled to rely on any oral notice made pursuant to Section
2.03(a)(v) believed by it to be genuine and made by the proper party or parties,
and the Borrowers and the Banks, as the case may be, agree to be conclusively
bound by the Administrative Agent's records in respect of any such notice.
SECTION 8.03. No Waiver; Remedies. No failure on the part of any Bank
or the Administrative Agent to exercise, and no delay in exercising, any right
hereunder shall operate as a waiver thereof; nor shall any single or partial
exercise of any such right preclude any other or further exercise thereof or the
exercise of any other right. The remedies herein provided are cumulative and not
exclusive of any remedies provided by law.
SECTION 8.04. Costs, Expenses and Taxes. (a) The Company agrees to pay
on demand all costs and expenses of the Administrative Agent in connection with
the preparation, execution, delivery, administration, modification, and
amendment of this Agreement, the Loan Papers, and the other documents to be
delivered hereunder, including, without limitation, the reasonable fees and
out-of-pocket expenses of counsel for the Administrative Agent with respect
thereto and with respect to advising the Administrative Agent as to its rights
and responsibilities under this Agreement, and all costs and expenses, if any,
(including, without limitation, reasonable counsel fees and expenses), incurred
by the Administrative Agent or any Bank in
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connection with the enforcement (whether through negotiations, legal proceedings
or otherwise) of this Agreement and the other documents to be delivered
hereunder. In addition, the Company agrees to pay any present or future stamp or
documentary taxes or any other excise or property taxes, charges, or similar
levies which arise from the execution and delivery of this Agreement and agrees
to save the Administrative Agent and each Bank harmless from and against any and
all liabilities with respect to or resulting from any delay in paying or
omission to pay such taxes.
(b) If any payment of principal of any Eurodollar Rate Contract
Advance, or Competitive Advance is made by any Borrower to or for the account of
a Bank, other than on the last day of the Interest Period for such Contract
Advance, or on the maturity date of such Competitive Advance, as the case may
be, or as a result of a payment pursuant to Section 2.07, or as a result of
acceleration of the maturity of the Advances pursuant to Article VI, or for any
other reason, or by an Eligible Assignee to a Bank, other than on the last day
of the Interest Period (or the final maturity date in the case of a Competitive
Advance) for such Advance upon an assignment of rights and obligations under
this Agreement pursuant to Section 8.07 as a result of a demand by the Company
pursuant to Section 8.07(a), or an assignment of rights and obligations under
this Agreement pursuant to Section 2.16 as a result of a demand by the Company,
or if the Company fails to convert or continue any Contract Advance hereunder
after irrevocable notice of such conversion or continuation has been given
pursuant to Section 2.04, the Borrower in respect of such Advance shall, upon
demand by such Bank (with a copy of such demand to the Administrative Agent),
pay to the Administrative Agent for the account of such Bank any amounts
required to compensate such Bank for any additional losses, costs or expenses
which it may reasonably incur as a result of such payment or failure, including,
without limitation, any loss (excluding loss of anticipated profits), cost or
expense incurred by reason of the liquidation or reemployment of deposits or
other funds acquired by such Bank to fund or maintain such Advance. A
certificate of such Bank setting forth the amount demanded hereunder and the
basis therefor shall, in the absence of manifest error, be conclusive and
binding for all purposes.
SECTION 8.05. Right of Set-off. Upon (i) the occurrence and during the
continuance of any Event of Default and (ii) the making of the request or the
granting of the consent specified by Article VI to authorize the Administrative
Agent to declare the Advances due and payable pursuant to the provisions of
Article VI, each Bank is hereby authorized at any time and from time to time, to
the fullest extent permitted by law, to set-off and apply any and all deposits
(general or special, time or demand, provisional or final) at any time held and
other indebtedness at any time owing by such Bank to or for the credit or the
account of any Borrower against any and all of the Obligation of such Borrower
now or hereafter existing under this Agreement or the Guarantee Agreement and
the Advances made by such Bank, irrespective of whether or not such Bank shall
have made any demand under this Agreement or the Guarantee Agreement and
although such obligations may be unmatured. Each Bank agrees promptly to notify
the Company and the Administrative Agent after any such set-off and application
made by such Bank; provided that the failure to give such notice shall not
affect the validity of such set-
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off and application. The rights of each Bank under this Section 8.05 are in
addition to other rights and remedies (including, without limitation, other
rights of set-off) which such Bank may have.
SECTION 8.06. Binding Effect. This Agreement shall become effective
when it shall have been executed by the Company and the Administrative Agent and
when the Administrative Agent shall have been notified by each Bank that such
Bank has executed it and thereafter shall be binding upon and inure to the
benefit of the Borrowers, the Administrative Agent and each Bank and their
respective successors and assigns.
SECTION 8.07. Assignments and Participations. (a) Each Bank may and,
if demanded by the Company pursuant to subsection (g) hereof, shall assign to
one or more banks or other entities all or a portion of its rights and
obligations under this Agreement (including, without limitation, all or a
portion of its Commitment and the Advances owing to it); provided, however, that
(i) each such assignment shall be of a constant, and not a varying, percentage
of all of the rights and obligations of the assigning Bank under this Agreement,
(ii) in the case of a partial assignment, the amount of the Commitment of the
assigning Bank being assigned pursuant to each such assignment (determined as of
the date of the Assignment and Acceptance with respect to such assignment) shall
in no event be less than $10,000,000 and shall be an integral multiple of
$5,000,000, (iii) each such assignment shall be to an Eligible Assignee, and
(iv) the parties to each such assignment shall execute and deliver to the
Administrative Agent, for its acceptance and recording in the Register (as
defined in Section 8.07(c)), an Assignment and Acceptance, together with a
processing fee of $3,500. Upon such execution, delivery, acceptance, and
recording, from and after the effective date specified in each Assignment and
Acceptance, which effective date shall be at least three Business Days after the
execution thereof, (x) the assignee thereunder shall be a party hereto and, to
the extent that rights and obligations hereunder have been assigned to it
pursuant to such Assignment and Acceptance, have the rights and obligations of a
Bank hereunder, and (y) the Bank assignor thereunder shall, to the extent that
rights and obligations hereunder have been assigned by it pursuant to such
Assignment and Acceptance, relinquish its rights and be released from its
obligations under this Agreement (and, in the case of an Assignment and
Acceptance covering all or the remaining portion of an assigning Bank's rights
and obligations under this Agreement, such Bank shall cease to be a party
hereto). Notwithstanding the foregoing (unless such assignment is being made on
demand of the Company pursuant to subsection (g)), any Bank assigning its rights
and obligations under this Agreement may retain any Competitive Advances made by
it outstanding at such time, and in such case shall retain its rights hereunder
in respect of any Advances so retained until such Advances have been repaid in
full in accordance with this Agreement.
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(b) By executing and delivering an Assignment and Acceptance, the Bank
assignor thereunder and the assignee thereunder confirm to and agree with each
other and the other parties hereto as follows:
(i) other than as provided in such Assignment and Acceptance, such
assigning Bank makes no representation or warranty and assumes no
responsibility with respect to any statements, warranties or
representations made in or in connection with this Agreement or the
execution, legality, validity, enforceability, genuineness, sufficiency or
value of this Agreement or any other instrument or document furnished
pursuant hereto; (ii) such assigning Bank makes no representation or
warranty and assumes no responsibility with respect to the financial
condition of the Company or the performance or observance by the Company of
any of its obligations under this Agreement or any other instrument or
document furnished pursuant hereto;
(iii) such assignee confirms that it has received a copy of this
Agreement, together with copies of the financial statements referred to in
subsection (e) of Article IV and such other documents and information as it
has deemed appropriate to make its own credit analysis and decision to
enter into such Assignment and Acceptance;
(iv) such assignee will, independently and without reliance upon the
Administrative Agent, such assigning Bank or any other Bank and based on
such documents and information as it shall deem appropriate at the time,
continue to make its own credit decisions in taking or not taking action
under this Agreement;
(v) such assignee confirms that it is an Eligible Assignee, except for
any required consent of the Company and Administrative Agent;
(vi) such assignee appoints and authorizes the Administrative Agent to
take such action as Administrative Agent on its behalf and to exercise such
powers under this Agreement as are delegated to the Administrative Agent by
the terms hereof, together with such powers as are reasonably incidental
thereto; and
(vii) such assignee agrees that it will perform in accordance with
their terms all the obligations which by the terms of this Agreement are
required to be performed by it as a Bank.
(c) The Administrative Agent shall maintain at its address referred to
in Section 8.02 a copy of each Assignment and Acceptance delivered to and
accepted by it and a register for the recordation of the names and addresses of
the Banks and the Commitment of, and principal amount of the Advances owing to,
each Bank from time to time (the "Register"). The entries in the Register shall
be conclusive and binding for all purposes, absent manifest error, and
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the Company, the Administrative Agent and the Banks may treat each Person whose
name is recorded in the Register as a Bank hereunder for all purposes of this
Agreement. The Register shall be available for inspection by the Company or any
Bank at any reasonable time and from time to time upon reasonable prior notice.
(d) Upon its receipt of an Assignment and Acceptance executed by an
assigning Bank and an assignee that it is an Eligible Assignee, the
Administrative Agent shall, if such Assignment and Acceptance has been completed
and is in substantially the form of Exhibit B hereto, and if the processing fees
required by Section 8.07 have been paid to Administrative Agent, (i) accept such
Assignment and Acceptance, (ii) record the information contained therein in the
Register, (iii) give prompt notice thereof to the Company and (iv) send a copy
thereof to the Company.
(e) Each Bank may sell participations to one or more banks or other
entities in or to all or a portion of its rights and obligations under this
Agreement (including, without limitation, all or a portion of its Commitment and
the Advances owing to it); provided, however, that (i) such Bank's obligations
under this Agreement (including, without limitation, its Commitment to any
Borrower hereunder) shall remain unchanged, (ii) such Bank shall remain solely
responsible to the other parties hereto for the performance of such obligations
and (iii) each applicable Borrower, the Administrative Agent and the other Banks
shall continue to deal solely and directly with such Bank in connection with
such Bank's rights and obligations under this Agreement and; provided further,
however, that such Bank shall not agree with any such bank or other financial
institution to permit such bank or other financial institution to enforce the
obligations of any Borrower relating to the Advances or to approve of any
amendment, modification or waiver of any provision of this Agreement (other than
amendments, modifications, or waivers with respect to any decrease in any fees
payable hereunder or the amount of principal or rate of interest which is
payable in respect of such Advances or any extension of the dates fixed for the
payment thereof).
(f) Any Bank may, in connection with any assignment or participation or
proposed assignment or participation pursuant to this Section 8.07, disclose to
the assignee or participant or proposed assignee or participant, any information
relating to the Company furnished to such Bank by or on behalf of the Company;
provided that prior to any such disclosure, the assignee or participant or
proposed assignee or participant, if not an Eligible Assignee, shall agree to
preserve the confidentiality of any confidential information relating to the
Company received by it from such Bank.
(g) If any Bank shall make demand for payment under or shall notify the
Company that it is affected by an event described in Section 2.10 or 2.14
hereunder or shall notify the Administrative Agent pursuant to Section 2.12
hereunder, then within 15 days after such demand or such notice, the Company may
(i) demand that such Bank assign in accordance with this Section 8.07 to one or
more Eligible Assignees, designated by the Company all (but not
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less than all) of such Bank's Commitment and the Advances owing to it within the
next succeeding 30 days; provided that if any such Eligible Assignee designated
by the Company shall fail to consummate such assignment on terms acceptable to
such Bank, or if the Company shall fail to designate any such Eligible Assignees
for all or part of such Bank's Commitment or Advances, then such Bank may assign
such Commitment or Advances to any other Eligible Assignee in accordance with
this Section 8.07 during such 30-day period or (ii) so long as no Event of
Default has occurred and is continuing, terminate all (but not less than all) of
such Bank's Commitment and repay all (but not less than all) of such Bank's
Advances not so assigned on or before such 30th day in accordance with Sections
2.06 and 2.07(c) hereof (but without the requirements stated therein for ratable
treatment of the Banks). Nothing in this Section 8.07(g) shall relieve such
applicable Borrower of its obligations for payment under Section 2.10 or 2.14
arising prior to an assignment or termination pursuant hereto.
(h) Any Bank may at any time assign all or any portion of its rights
under this Agreement to a Federal Reserve Bank; provided that no such assignment
shall release a Bank from any of its obligations hereunder. In connection with
any such assignment or proposed assignment, the Company will, promptly upon the
request of any Bank, execute and deliver to such Bank a note evidencing the
Company's obligations hereunder, in a form mutually satisfactory to the Company
and such Bank.
(i) This Section 8.07 sets forth the exclusive manner by which a Bank
may assign its rights and obligations hereunder or sell participations in or to
its rights and obligations hereunder.
(j) Each Bank agrees to notify the Company of any assignment of any
Advance and of the identity of the assignee or participant.
(k) None of the Borrowers may assign or delegate any rights or
obligations hereunder without the prior written consent of each Bank.
(l) Notwithstanding anything to the contrary contained herein, any Bank
(a "Granting Bank") may grant to a special purpose funding vehicle (an "SPC")
sponsored by such Granting Bank, identified as such in writing from time to time
by the Granting Bank to the Administrative Agent and the applicable Borrower,
the option to provide to any Borrower all or any part of any Advance that such
Granting Bank would otherwise be obligated to make to such Borrower pursuant to
this Agreement; provided that (i) nothing herein shall constitute a commitment
by any SPC to make any Advance, (ii) if an SPC elects not to exercise such
option or otherwise fails to provide all or any part of such Advance, the
Granting Bank shall be obligated to make such Advance pursuant to the terms
hereof. The making of an Advance by an SPC hereunder shall utilize the
Commitment of the Granting Bank to the same extent, and as if, such Advance were
made by such Granting Bank. Each party hereto hereby agrees that no SPC shall be
liable for any indemnity or similar payment obligation under this Agreement (all
liability
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for which shall remain with the Granting Bank). In furtherance of the foregoing,
each party hereto hereby agrees (which agreement shall survive the termination
of this Agreement) that, prior to the date that is one year and one day after
the payment in full of all outstanding commercial paper or other senior
indebtedness of any SPC, it will not institute against, or join any other person
in instituting against, such SPC any bankruptcy, reorganization, arrangement,
insolvency or liquidation proceedings under the laws of the United States or any
State thereof. In addition, notwithstanding anything to the contrary contained
in this Section 8.07, any SPC may (i) with notice to, but without the prior
written consent of, the applicable Borrower and the Administrative Agent and
without paying any processing fee therefor, assign all or a portion of its
interests in any Advances to the Granting Bank or to any financial institutions
(consented to by the applicable Borrower and Administrative Agent) providing
liquidity and/or credit support to or for the account of such SPC to support the
funding or maintenance of Advances and (ii) disclose on a confidential basis any
non-public information relating to its Advances to any rating agency, commercial
paper dealer or provider of any surety, guarantee or credit or liquidity
enhancement to such SPC.
(m) Notwithstanding the foregoing, the Administrative Agent, the
Canadian Sub-Agent, the Banks and the Borrowers acknowledge that The
Toronto-Dominion Bank has granted or may grant an unfunded participation in
respect of a portion of its Canadian Commitment in favor of Chase Bank of Texas,
N.A. and that so long as such participation remains in effect, Chase Bank of
Texas, N.A. shall be treated as a Bank for purposes of (and solely for purposes
of) voting on all matters requiring the approval of the Banks or the Majority
Banks, as the case may be, under this Agreement and the other Loan Papers, and
shall be entitled to receive any information that a Bank is entitled to receive
under this Agreement.
SECTION 8.08. GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY, AND
CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.
SECTION 8.09. Exceptions to Covenants. The Company may not take or
fail to take any action that is permitted as an exception to any of the
covenants contained in any Loan Paper if that action or omission would result in
the breach of any other covenant contained in any Loan Paper.
SECTION 8.10. Survival. All covenants, agreements, undertakings,
representations and warranties made in any of the Loan Papers survive all
closings under the Loan Papers until payment in full of the Obligation and
termination of this Agreement, except that Sections 2.10, 2.11, 2.14, 7.05, 8.04
and 8.15 (together with any other provisions in the Loan Papers which expressly
provides that it shall survive termination of this Agreement) shall survive
termination of this Agreement; and such covenants, agreements, undertakings,
representations and warranties, except as otherwise indicated, are not affected
by any investigation made by any party.
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SECTION 8.11. Invalid Provisions. Any provision in any Loan Paper held
to be illegal, invalid, or unenforceable is fully severable; the appropriate
Loan Paper shall be construed and enforced as if that provision had never been
included; and the remaining provisions shall remain in full force and effect and
shall not be affected by the severed provision. Administrative Agent, Banks and
the Borrower or Borrowers party to the affected Loan Paper agree to negotiate in
good faith the terms of a replacement provision as similar to the severed
provision as may be possible and be legal, valid and enforceable.
SECTION 8.12. Maximum Rate. Regardless of any provision contained in
any Loan Paper, no Bank shall ever be entitled to contract for, charge, take,
reserve, receive or apply as interest on the Obligation, or any part thereof,
any amount in excess of the Maximum Rate, and, if Banks ever do so, then any
excess shall be deemed a partial prepayment of principal and treated hereunder
as such and any remaining excess shall be refunded to the applicable Borrower or
Borrowers. In determining if the interest paid or payable exceeds the Maximum
Rate, the Borrowers and Banks shall, to the maximum extent permitted under
applicable law, (a) treat all Borrowings as but a single extension of credit
(and Banks and the Borrowers agree that such is the case and that provision
herein for multiple Borrowings is for convenience only), (b) characterize any
nonprincipal payment as an expense, fee, or premium rather than as interest, (c)
exclude voluntary prepayments and the effects thereof, and (d) amortize,
prorate, allocate, and spread the total amount of interest throughout the entire
contemplated term of the Obligation; provided that if the Obligation is paid and
performed in full prior to the end of the full contemplated term thereof, and if
the interest received for its actual period of existence thereof exceeds the
Maximum Amount, Banks shall refund any excess (and Banks shall not, to the
extent permitted by law, be subject to any penalties provided by any laws for
contracting for, charging, taking, reserving, or receiving interest in excess of
the Maximum Amount).
SECTION 8.13. Execution in Counterparts. This Agreement may be
executed in any number of counterparts and by different parties hereto in
separate counterparts, each of which when so executed shall be deemed to be an
original and all of which taken together shall constitute one and the same
agreement.
SECTION 8.14. Not in Control. Nothing in any Loan Paper gives or may
be deemed to give to Administrative Agent or any Bank the right to exercise
control over the Company or any Subsidiary's Principal Property, other assets,
affairs or management or to preclude or interfere with the Company or any
Subsidiary's compliance with any law or require any act or omission by the
Company or any Subsidiary that may be harmful to Persons or property. Any
materiality or substantiality qualifier of any representation, warranty,
covenant, agreement or other provision of any Loan Paper is included for credit
documentation purposes only and does not imply, and shall not be deemed to mean,
that Administrative Agent or any Bank acquiesces in any noncompliance by the
Company or any Subsidiary with any law, document, or otherwise or does not
expect the Company or any Subsidiary to promptly,
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diligently and continuously carry out all appropriate removal, remediation,
compliance, closure or other activities required or appropriate in accordance
with all Environmental Laws.
SECTION 8.15. INDEMNIFICATION. THE COMPANY SHALL INDEMNIFY, PROTECT,
AND HOLD THE ADMINISTRATIVE AGENT, CHASE SECURITIES INC., EACH BANK, AND THEIR
RESPECTIVE AFFILIATES, PARENTS, AND SUBSIDIARIES, AND EACH OF THE FOREGOING
PARTIES' RESPECTIVE DIRECTORS, OFFICERS, EMPLOYEES, REPRESENTATIVES, AGENTS,
SUCCESSORS, ASSIGNS, AND ATTORNEYS (COLLECTIVELY, THE "INDEMNIFIED PARTIES")
HARMLESS FROM AND AGAINST ANY AND ALL PRESENT AND FUTURE, KNOWN AND UNKNOWN,
FIXED AND CONTINGENT, LIABILITIES, OBLIGATIONS, LOSSES, DAMAGES, PENALTIES,
ACTIONS, JUDGMENTS, SUITS, CLAIMS, AND PROCEEDINGS AND ALL REASONABLE AND
NECESSARY COSTS, EXPENSES (INCLUDING, WITHOUT LIMITATION, ALL REASONABLE
ATTORNEYS' FEES AND LEGAL EXPENSES, AND AMOUNTS PAID IN SETTLEMENT WHETHER OR
NOT SUIT IS BROUGHT), AND DISBURSEMENTS OF ANY KIND OR NATURE WHATSOEVER (THE
"INDEMNIFIED LIABILITIES") WHICH MAY AT ANY TIME BE IMPOSED ON, INCURRED BY, OR
ASSERTED AGAINST THE INDEMNIFIED PARTIES, IN ANY WAY RELATING TO OR ARISING OUT
OF (A) ANY LOAN PAPERS OR TRANSACTION CONTEMPLATED BY ANY LOAN PAPER (INCLUDING,
WITHOUT LIMITATION, THE ACQUISITION), OR (B) ANY INDEMNIFIED PARTY'S SOLE OR
CONCURRENT ORDINARY NEGLIGENCE ARISING IN CONNECTION WITH ANY LOAN PAPER OR ANY
TRANSACTION CONTEMPLATED BY ANY LOAN PAPER, TO THE EXTENT THAT ANY OF THE
INDEMNIFIED LIABILITIES AS TO ANY INDEMNIFIED PARTY RESULTS, DIRECTLY OR
INDIRECTLY, FROM ANY CLAIM MADE, OR ACTION, SUIT, OR PROCEEDING COMMENCED BY OR
ON BEHALF OF ANY PERSON OTHER THAN BY SUCH INDEMNIFIED PARTY; PROVIDED THAT, THE
COMPANY SHALL HAVE NO OBLIGATION HEREUNDER TO ANY INDEMNIFIED PARTY WITH RESPECT
TO ANY INDEMNIFIED LIABILITY ARISING FROM THE FRAUD, GROSS NEGLIGENCE, OR WILFUL
MISCONDUCT OF SUCH INDEMNIFIED PARTY OR ANY ASSOCIATED PERSON OF SUCH
INDEMNIFIED PARTY. AS USED IN THIS PARAGRAPH, THE TERM "ASSOCIATED PERSON"
MEANS, WITH RESPECT TO ANY PERSON, THE AFFILIATES, PARENTS, SUBSIDIARIES,
DIRECTORS, OFFICERS, EMPLOYEES, REPRESENTATIVES, AGENTS, SUCCESSORS, ASSIGNS,
AND ATTORNEYS OF SUCH PERSON, OR OF ANOTHER PERSON OF WHICH SUCH PERSON IS ALSO
AN ASSOCIATED PERSON. THE PROVISIONS OF AND UNDERTAKINGS AND INDEMNIFICATION SET
FORTH IN THIS SECTION SHALL SURVIVE THE SATISFACTION AND PAYMENT OF THE
OBLIGATION AND TERMINATION OF THIS AGREEMENT. THE COMPANY MAY, AT ITS OWN COST
AND EXPENSE, PARTICIPATE IN THE DEFENSE IN ANY PROCEEDING INVOLVING ANY
INDEMNIFIED LIABILITY. IF NO EVENT OF DEFAULT EXISTS, THE COMPANY MAY ASSUME THE
DEFENSE IN THAT PROCEEDING ON BEHALF OF THE APPLICABLE
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INDEMNIFIED PARTIES, INCLUDING THE EMPLOYMENT OF COUNSEL IF FIRST APPROVED
(WHICH APPROVAL MAY NOT BE UNREASONABLY WITHHELD) BY THE APPLICABLE INDEMNIFIED
PARTIES. IF THE COMPANY ASSUMES ANY DEFENSE, IT SHALL KEEP THE APPLICABLE
INDEMNIFIED PARTIES FULLY ADVISED OF THE STATUS OF, AND SHALL CONSULT WITH THOSE
INDEMNIFIED PARTIES BEFORE TAKING ANY MATERIAL POSITION IN RESPECT OF, THAT
PROCEEDING. IF THE COMPANY CONSENTS OR IF ANY INDEMNIFIED PARTY REASONABLY
DETERMINES THAT AN ACTUAL CONFLICT OF INTEREST EXISTS BETWEEN THE COMPANY AND
THAT INDEMNIFIED PARTY WITH RESPECT TO THE SUBJECT MATTER OF THE PROCEEDING OR
THAT THE COMPANY IS NOT DILIGENTLY PURSUING THE DEFENSE, THEN (I) THAT
INDEMNIFIED PARTY MAY, AT THE COMPANY'S EXPENSE, EMPLOY COUNSEL TO REPRESENT
INDEMNIFIED PARTY THAT IS SEPARATE FROM COUNSEL FOR THE COMPANY OR ANY OTHER
PERSON IN THAT PROCEEDING AND (II) THE COMPANY IS NO LONGER ENTITLED TO ASSUME
THE DEFENSE ON BEHALF OF THAT INDEMNIFIED PARTY. THE COMPANY MAY NOT AGREE TO
THE SETTLEMENT OF ANY INDEMNIFIED LIABILITY WITHOUT THE PRIOR WRITTEN CONSENT OF
THE APPLICABLE INDEMNIFIED PARTIES UNLESS THAT SETTLEMENT FULLY RELIEVES THOSE
INDEMNIFIED PARTIES OF ANY LIABILITY WHATSOEVER FOR THAT INDEMNIFIED LIABILITY.
SECTION 8.16. ENTIRETY. THE LOAN PAPERS REPRESENT THE FINAL AGREEMENT
BETWEEN THE BORROWERS, BANKS AND ADMINISTRATIVE AGENT AND MAY NOT BE
CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS OR SUBSEQUENT ORAL AGREEMENTS
BY SUCH PARTIES. THERE ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN SUCH PARTIES.
SECTION 8.17. 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 8.18. Conversion of Currencies. (a) If, for the purpose of
obtaining judgment in any court, it is necessary to convert a sum owing
hereunder in one currency into
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another currency, each party hereto (including any Canadian Borrowers) agrees,
to the fullest extent that it may effectively do so, that the rate of exchange
used shall be that at which in accordance with normal banking procedures in the
relevant jurisdiction the first currency could be purchased with such other
currency on the Business Day immediately preceding the day on which final
judgment is given.
(b) The obligations of the Borrowers in respect of any sum due to any
party hereto or any holder of the obligations owing hereunder (the "Applicable
Creditor") shall, notwithstanding any judgment in a currency (the "Judgment
Currency") other than the currency in which such sum is stated to be due
hereunder (the "Agreement Currency"), be discharged only to the extent that, on
the Business Day following receipt by the Applicable Creditor of any sum
adjudged to be so due in the Judgment Currency, the Applicable Creditor may in
accordance with normal banking procedures in the relevant jurisdiction purchase
the Agreement Currency with the Judgment Currency; if the amount of the
Agreement Currency so purchased is less than the sum originally due to the
Applicable Creditor in the Agreement Currency, such the Borrower agrees, as a
separate obligation and notwithstanding any such judgment, to indemnify the
Applicable Creditor against such loss. The obligations of each Borrower
contained in this Section 8.18 shall survive the termination of this Agreement
and the payment of all other amounts owing hereunder.
SECTION 8.19. Interest Act (Canada). For purposes of the Interest Act
(Canada) and disclosure thereunder, whenever interest to be paid with respect to
Canadian Advances or fees relating thereto is to be calculated on the basis of a
year of 360 days or any other period of time that is less than a calendar year,
the yearly rate of interest to which the rate determined pursuant to such
calculation is equivalent is the rate so determined multiplied by the actual
number of days in the calendar year in which the same is to be ascertained and
divided by either 360 or such other period of time, as the case may be.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be executed by their respective officers thereunto duly authorized, as of the
date first above written.
UNION PACIFIC RESOURCES GROUP
INC.,
by
-------------------------
Name:
Title:
CHASE BANK OF TEXAS, N.A., as
Administrative Agent and as a Bank
by
-------------------------
Name:
Title:
THE CHASE MANHATTAN BANK OF
CANADA, as Canadian Sub-Agent
by
-------------------------
Name:
Title:
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CREDIT SUISSE FIRST BOSTON
by
-------------------------
Name:
Title:
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77
NATIONSBANK OF TEXAS, N.A.
by
-------------------------
Name:
Title:
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78
ROYAL BANK OF CANADA
by
-------------------------
Name:
Title:
ROYAL BANK OF CANADA
by
-------------------------
Name:
Title:
83
79
BANK OF MONTREAL
by
-------------------------
Name:
Title:
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80
CITICORP USA, INC.
by
-------------------------
Name:
Title:
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81
DEUTSCHE BANK AG, NEW YORK
AND/OR CAYMAN ISLAND BRANCH
by
-------------------------
Name:
Title:
DEUTSCHE BANK CANADA
by
-------------------------
Name:
Title:
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THE FIRST NATIONAL BANK OF
CHICAGO
by
-------------------------
Name:
Title:
FIRST CHICAGO NBD BANK, CANADA
by
-------------------------
Name:
Title:
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83
TORONTO DOMINION (TEXAS), INC.
by
-------------------------
Name:
Title:
THE TORONTO-DOMINION BANK
by
-------------------------
Name:
Title:
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84
ABN AMRO BANK, N.V.
by
-------------------------
Name:
Title:
ABN AMRO BANK CANADA
by
-------------------------
Name:
Title:
by
-------------------------
Name:
Title:
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85
UBS AG
by
-------------------------
Name:
Title:
UBS BANK [CANADA]
by
-------------------------
Name:
Title:
by
-------------------------
Name:
Title:
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86
THE BANK OF NEW YORK
by
-------------------------
Name:
Title:
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87
THE INDUSTRIAL BANK OF JAPAN,
LIMITED
by
-------------------------
Name:
Title:
92
88
WESTDEUTSCHE LANDESBANK
GIROZENTRALE, NEW YORK BRANCH
by
-------------------------
Name:
Title:
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89
MELLON BANK, N.A.
by
-------------------------
Name:
Title:
94
90
KBC BANK N.V.
by
-------------------------
Name:
Title:
KBC BANK CANADA
by
-------------------------
Name:
Title:
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THE NORTHERN TRUST COMPANY
by
-------------------------
Name:
Title:
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92
SUNTRUST BANK
by
-------------------------
Name:
Title:
97
93
FROST BANK
by
-------------------------
Name:
Title:
98
THE TORONTO-DOMINION BANK, in
respect of the participated Canadian
Commitment with Chase Bank of Texas,
N.A.,
by
-------------------------
Name:
Title:
99
ANNEX I
Banker's Acceptances
(a) Interpretation. All references in this Annex to "this Agreement"
refer to the Agreement to which this Annex is attached, including this Annex.
All capitalized terms in this Annex have the meanings given to them in this
Agreement, unless otherwise defined in this Annex. All references to "Sections"
and "Articles" in this Annex are references to sections and articles of this
Agreement, unless otherwise specified.
(b) General Provisions. Drafts issued by a Canadian Borrower on the
occasion of any Acceptance Borrowing shall be in an aggregate face amount of not
less than Canadian $10,000,000 or an integral multiple of Canadian $5,000,000 in
excess thereof and, subject to the terms and conditions set forth in this
Agreement, shall be accepted by the Canadian Banks ratably in accordance with
their respective Canadian Commitments (except as provided in Section 2.03 hereof
or in paragraph (m) of this Annex). For purposes of this Agreement, the full
face value of an Acceptance, without discount, shall be used when calculations
are made to determine the outstanding amount of any Acceptance or the Assigned
Dollar Value thereof.
(c) Terms of Acceptance. Each Draft shall be accepted and purchased
by a Canadian Bank, upon the written request of the applicable Canadian Borrower
given in accordance with paragraph (d) of this Annex, by the completion and
acceptance by such Canadian Bank of a Draft (i) payable in Canadian Dollars,
drawn by such Canadian Borrower on such Canadian Bank in accordance with this
Agreement, to the order of such Canadian Bank or, in the case of depository
bills within the meaning of the Depository Bills and Notes Act (Canada), to the
order of "CDS&Co.", and (ii) maturing prior to the Termination Date on a
Business Day that occurs either 30, 60 or 90 days (or such other period as
agreed to by the Canadian Sub-Agent and the Canadian Banks)after the date of
such Draft, all as specified in the relevant Notice of Drawing.
(d) Notice of Drawing and Discount of Acceptances.
(i) With respect to each requested acceptance of Drafts, the applicable
Canadian Borrower shall give the Canadian Sub-Agent a notice (a "Notice of
Drawing"), substantially in the form of Exhibit E hereto (which shall be
irrevocable) to be received prior to 11:00 a.m. (Toronto time) at least two
Business Days prior to the date of the requested acceptance, specifying:
(A) the date on which such Drafts are to be accepted;
(B) the aggregate face amount of such Drafts;
(C) the maturity date of such Drafts; and
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(D) such additional information as the Canadian Sub-Agent or any
Canadian Bank may from time to time reasonably request to be included
in such notices.
(ii) Upon receipt of a Notice of Drawing the Canadian Sub-Agent shall
promptly notify each Canadian Bank of the contents thereof and of such
Canadian Bank's ratable share of the Acceptances requested thereunder. The
aggregate face amount of the Drafts to be accepted by a Canadian Bank shall
be determined by the Canadian Sub-Agent by reference to the respective
Canadian Commitments of the Canadian Banks.
(iii) Not later than 10:00 a.m., Toronto time, on the date of the
acceptance of a Draft, the Canadian Sub-Agent shall notify the applicable
Canadian Borrower (or the Company, on its behalf) of the Applicable BA
Discount Rate. Not later than 2:00 p.m., Toronto time, on such date each
Canadian Bank shall, subject to the fulfillment of the applicable conditions
precedent specified in Sections 3.02 and 3.03 and subject to the provisions
of paragraph (f) of this Annex, (A) on the basis of the information supplied
by the Canadian Sub-Agent, as aforesaid, complete a Draft or Drafts of such
Canadian Borrower by filling in the amount, date and maturity date thereof
in accordance with the applicable Notice of Drawing, (B) duly accept such
Draft or Drafts, (C) discount the Acceptance or Acceptances created thereby,
(D) give the Canadian Sub-Agent telegraphic or telex notice of such Canadian
Bank's acceptance of such Draft or Drafts and of its discount thereof,
confirming the amount paid to the Canadian Sub-Agent for the account of such
Canadian Borrower and (E) remit to the Canadian Sub-Agent in Canadian
Dollars in immediately available funds an amount equal to the BA Discount
Proceeds of such Acceptance. Upon receipt by the Canadian Sub-Agent of such
sums from the Canadian Banks, the Canadian Sub-Agent shall make the
aggregate amount thereof available to the applicable Canadian Borrower. The
Acceptance Fee with respect to any Acceptance accepted by any Canadian Bank
shall be deducted from the BA Discount Proceeds payable by such Canadian
Bank hereunder.
(iv) Each extension of credit hereunder through the acceptance of Drafts
shall be made simultaneously and pro rata by the Canadian Banks in
accordance with their respective Canadian Commitments; provided, however,
that the failure of any Canadian Bank to accept any Drafts shall not relieve
any other Canadian Bank of its obligation to accept Drafts hereunder (it
being understood, however, that no Canadian Bank shall be responsible for
the failure of any other Canadian Bank to accept any Drafts required to be
accepted by such other Canadian Bank).
(e) Acceptance Obligation. Each Canadian Borrower is obligated, and
hereby unconditionally agrees, to pay to each Canadian Bank the face amount of
each Acceptance created by such Canadian Bank in accordance with a Notice of
Drawing pursuant to paragraph (d) of this Annex on the maturity date thereof, or
on such earlier date as may be required pursuant to provisions of this
Agreement. With respect to each Acceptance which is outstanding
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hereunder, the applicable Canadian Borrower shall notify the Canadian Sub-Agent
prior to 11:00 a.m. (Toronto time) three Business Days prior to the maturity
date of such Acceptance (which notice shall be irrevocable) of such Canadian
Borrower's intention to issue Acceptances on such maturity date to provide for
the payment of such maturing Acceptance and shall deliver a Notice of Drawing to
the Canadian Sub-Agent. Any repayment of an Acceptance must be made at or before
2:00 p.m. (Toronto time) on the maturity date of such Acceptance, it being
understood that payments by any Canadian Borrowers and fundings by any Canadian
Banks in respect of each maturing Acceptance and each new Acceptance shall be
made on a net basis reflecting the difference between the face amount of the
maturing Acceptance and the BA Discount Proceeds of the new Acceptance, less the
applicable Acceptance Fee. If the applicable Canadian Borrower fails to give the
foregoing notice, and if the subject Acceptance Obligation is not paid when due,
the applicable Canadian Borrower shall irrevocably be deemed to have requested
and to have been advanced a Canadian Prime Rate Contract Advance in the face
amount of such maturing Acceptance on the maturity date of such Acceptance from
the Canadian Bank which accepted such maturing Acceptance, which Canadian Prime
Rate Contract Advance Acceptance shall bear interest, payable on demand, at a
rate per annum equal to the Canadian Prime Rate in effect from time to time,
from the due date thereof to the date of payment thereof. Each Canadian Borrower
waives presentment for payment and any other defense to payment of any amounts
due to a Canadian Bank in respect of any Acceptances accepted by such Canadian
Bank under this Agreement which might exist solely by reason of those
Acceptances being held, at the maturity thereof, by that Canadian Bank in its
own right and each Canadian Borrower agrees not to claim any days of grace if
that Canadian Bank, as holder, sues such Canadian Borrower on those Acceptances
for payment of the amounts payable by such Canadian Borrower thereunder.
(f) Power of Attorney. Each Canadian Borrower hereby appoints each
Canadian Bank as the attorney of the applicable Canadian Borrower to sign and
endorse on behalf of such Canadian Borrower, in handwriting or by facsimile or
mechanical signature as and when requested by the applicable Canadian Borrower,
blank forms of Drafts conforming with the requirements of this Agreement and in
form satisfactory to the applicable Canadian Bank. Each Canadian Borrower hereby
recognizes and agrees that all Acceptances signed or endorsed or both on its
behalf by a Canadian Bank shall bind the Canadian Borrower as fully and
effectually as if signed in the handwriting of and duly issued by the proper
signing officer of the applicable Canadian Borrower. Each Canadian Bank is
hereby authorized to issue such Acceptances endorsed in blank in such face
amounts as may be determined by such Canadian Bank provided that the aggregate
amount thereof is equal to the aggregate amount of Acceptances required to be
accepted by such Canadian Bank. No Canadian Bank shall be liable for any damage,
loss or other claim arising by reason of any loss or improper use of any
Acceptance except loss or improper use arising by reason of the gross
negligence, wilful misconduct or unlawful conduct of such Canadian Bank, its
officers, employees, agents or representatives. Each Canadian Bank shall
maintain a record with respect to Acceptances (A) voided by it for any reason,
(B) accepted by it hereunder, (C) purchased by it hereunder and (D) canceled at
their respective maturities.
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Each Canadian Bank further agrees to retain such records in the manner and for
the statutory periods provided in the various Canadian provincial or federal
statutes and regulations which apply to such Canadian Bank.
(g) In case any authorized signatory of any Canadian Borrower whose
signature shall appear on any Draft shall cease to have such authority before
the acceptance of a Draft with respect to such Draft, the obligations of such
Canadian Borrower hereunder and under such Acceptance shall nevertheless be
valid for all purposes as if such authority had remained in force until such
creation. The Canadian Sub-Agent and each Canadian Bank shall be fully protected
in relying upon any instructions received from the Company or any Canadian
Borrower (orally or otherwise) without any duty to make inquiry as to the
genuineness of such instructions. The Canadian Sub-Agent and each Canadian Bank
shall be entitled to rely on instructions received from any person identifying
himself (orally or otherwise) as a duly authorized officer of the Company or any
Canadian Borrower and shall not be liable for any errors, omissions, delays or
interruptions in the transmission of such instructions, except for those arising
by reason of the gross negligence, wilful misconduct or unlawful conduct of the
Canadian Sub-Agent or such Canadian Bank or their respective officers,
employees, agents or representatives, as the case may be.
(h) Rights of Canadian Bank as to Acceptances. Neither the Canadian
Sub-Agent nor any Canadian Bank shall have any responsibility as to the
application of the proceeds by any Canadian Borrower of any discounted proceeds
of any Acceptances. For greater certainty, each Canadian Bank may, at any time,
purchase Acceptances issued by any Canadian Borrower and may at any time and
from time to time hold, sell, rediscount or otherwise dispose of any or all
Acceptances accepted and/or purchased by it.
(i) Acceptance Equivalent Loans. Whenever any Canadian Borrower
delivers a Notice of Drawing to the Canadian Sub-Agent under this Agreement
requesting the Canadian Banks to accept Drafts, a Canadian Bank may at its
option, in lieu of accepting Drafts, make an Acceptance Equivalent Loan. On each
date on which Drafts are to be accepted, subject to the same terms and
conditions applicable to the acceptance of Drafts, any Canadian Bank that elects
to make an Acceptance Equivalent Loan, upon delivery by the applicable Canadian
Borrower of an executed promissory note substantially in the form of Exhibit "F"
hereto (a "Discount Note") payable to the order of such Canadian Bank, will
remit to the Canadian Sub-Agent in immediately available funds for the account
of such Canadian Borrower discounted proceeds in regards thereto equal to the
amount of BA Discount Proceeds that would have applied had such Canadian Bank
accepted and purchased a Draft in the same face amount on the same day, net of
the Acceptance Fee payable in regard thereto under subparagraph (j)(ii) of this
Annex.
(j) Terms Applicable to Discount Notes. The term "Acceptance" when used
in this Agreement shall be construed to include Discount Notes and all terms of
this Agreement applicable to Acceptances shall apply equally to Discount Notes
evidencing Acceptance
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Equivalent Loans with such changes as may in the context be necessary (except
that no Discount Note may be sold, rediscounted or otherwise disposed of by the
Canadian Bank making Acceptance Equivalent Loans other than pursuant to Section
8.07). For greater certainty:
(i) a Discount Note shall mature and be due and payable on the same date as
the maturity date for Acceptances specified in the applicable Notice of Drawing;
(ii) an Acceptance Fee will be payable in respect of a Discount Note and
shall be calculated at the same rate and in the same manner as the Acceptance
Fee in respect of an Acceptance; and
(iii) an Acceptance Equivalent Loan made by a Canadian Bank will be
considered to be part of a Canadian Bank's outstanding Acceptances for all
purposes of this Agreement.
(k) Prepayment of Acceptances and Discount Notes. No Acceptance or
Discount Note may be repaid or prepaid prior to the maturity date of such
Acceptance or Discount Note, except in accordance with the provisions of Article
VI.
(l) At the option of any Canadian Bank, Acceptances under this
Agreement to be accepted by such Canadian Bank may be issued in the form of
depository bills payable to the order of "CDS&Co." for deposit with The Canadian
Depository for Securities Limited pursuant to the Depository Bills and Notes Act
(Canada). All depository bills so issued shall be governed by the provisions of
this Annex.
(m) Deemed Canadian Competitive Advances. On the Closing Date, banker's
acceptances outstanding under the Credit Agreements referred to in clauses
(d)(ii), (d)(iii), (d)(iv) and (d)(v) of the definition of Previous Credit
Agreements as listed on Schedule V hereto shall be deemed to be Competitive
Advances made to Union Pacific Resources Inc., as a Canadian Borrower under this
Agreement on the Closing Date and such Credit Agreements shall hereby be
terminated. On the Closing Date, the Company shall notify the Canadian Sub-Agent
and the Administrative Agent of the amounts, terms, pricing and maturity dates
of the banker's acceptances referred to in the previous sentence made by each
Bank. This Section (m) shall not change the amount, terms, pricing or maturity
date of any of the banker's acceptances referred to in the first sentence of
this Section.