\nSchedule I Commitments and Addresses for Notices
\nSchedule 3.18 Subsidiaries<\/p>\nEXHIBITS<\/p>\n
Exhibit A Form of Revolving Credit Note
\nExhibit B Form of Subsidiaries Guarantee
\nExhibit C Form of Effective Certificate
\nExhibit D Form of Opinion of Lynch, Chappell & Alsup
\nExhibit E Form of Borrowing Base Certificate
\nExhibit F Form of Assignment and Acceptance
\n<\/c><\/s><\/table>\n
5<\/p>\n
6<\/p>\n
CREDIT AGREEMENT, dated as of April 17, 1998 (this “Agreement”),
\namong Tom Brown, Inc., a Delaware corporation (the “Borrower”), the several
\nbanks and other financial institutions from time to time parties to this
\nAgreement (individually, a “Lender”, and collectively, the “Lenders”) and The
\nChase Manhattan Bank, a New York banking corporation (“Chase”), as
\nadministrative agent for the Lenders hereunder (in such capacity, the “Agent”).<\/p>\n
The parties hereto hereby agree as follows:<\/p>\n
SECTION 1. DEFINITIONS<\/p>\n
1.1 Defined Terms. As used in this Agreement, the following
\nterms shall have the following meanings:<\/p>\n
“ABR”: for any day, a rate per annum (rounded upwards, if
\n necessary, to the next 1\/16 of 1%) equal to the greater of (a) the
\n Prime Rate in effect on such day and (b) the Federal Funds Effective
\n Rate in effect on such day plus 1\/2 of 1%. For purposes hereof:
\n “Prime Rate” shall mean the rate of interest per annum publicly
\n announced from time to time by the Agent as its prime rate in effect
\n at its principal office in New York City (the Prime Rate not being
\n intended to be the lowest rate of interest charged by Chase in
\n connection with extensions of credit to debtors); “Federal Funds
\n Effective Rate” shall mean, for any day, the weighted average of the
\n rates on overnight federal funds transactions with members of the
\n Federal Reserve System arranged by federal funds brokers, as published
\n on the next succeeding Business Day by the Federal Reserve Bank of New
\n York, or, if such rate is not so published for any day which is a
\n Business Day, the average of the quotations for the day of such
\n transactions received by the Agent from three federal funds brokers of
\n recognized standing selected by it. Any change in the ABR due to a
\n change in the Prime Rate or the Federal Funds Effective Rate shall be
\n effective as of the opening of business on the effective day of such
\n change in the Prime Rate or the Federal Funds Effective Rate,
\n respectively.<\/p>\n
“ABR Loans”: Revolving Credit Loans the rate of interest
\n applicable to which is based upon the ABR.<\/p>\n
“Affiliate”: as to any Person, any other Person (other than a
\n Subsidiary) which, directly or indirectly, is in control of, is
\n controlled by, or is under common control with, such Person. For
\n purposes of this definition, “control” of a Person means the power,
\n directly or indirectly, either to (a) vote 10% or more of the
\n securities having ordinary voting power for the election of directors
\n of such Person or (b) direct or cause the direction of the management
\n and policies of such Person, whether by contract or otherwise.<\/p>\n
“Agent”: The Chase Manhattan Bank, as the administrative
\n agent for the Lenders under this Agreement and the other Loan
\n Documents.<\/p>\n
“Agreement”: this Credit Agreement, as amended, supplemented
\n or otherwise modified from time to time.<\/p>\n
“Applicable Margin”: on each day when the Utilization
\n Percentage is less than 50%, 0.625% per annum, on each day when the
\n Utilization Percentage is equal to or
\n 7
\n 2<\/p>\n
greater than 50% but less than or equal to 75%, 0.75% per annum, and
\n on each day when the Utilization Percentage is greater than 75%, 1.00%
\n per annum.<\/p>\n
“Assignee”: as defined in subsection 9.6(c).<\/p>\n
“Available Commitment”: at any time any amount equal to the
\n lesser of (i) the aggregate Commitments of the Lenders and (ii) the
\n Borrowing Base at that time.<\/p>\n
“Board”: the Board of Governors of the Federal Reserve
\n System.<\/p>\n
“Borrowing Base”: at any date, the amount determined pursuant
\n to subsection 2.6(a) as the amount of credit available to the Borrower
\n under this Agreement at such date.<\/p>\n
“Borrowing Base Assets”: the proven reserves of the Borrower
\n and each Subsidiary Guarantor described in the most recent Reserve
\n Report submitted by the Borrower to the Agent in accordance with
\n subsection 2.6(b).<\/p>\n
“Borrowing Date”: any Business Day specified in a notice
\n pursuant to subsection 2.2 as a date on which the Borrower requests
\n the Lenders to make Revolving Credit Loans hereunder.<\/p>\n
“Business”: as defined in subsection 3.16(b).<\/p>\n
“Business Day”: a day other than a Saturday, Sunday or any
\n other day on which commercial banks in New York City are authorized or
\n required by law to close.<\/p>\n
“Capital Stock”: any and all shares, interests,
\n participations or other equivalents (however designated) of capital
\n stock of a corporation, any and all equivalent ownership interests in
\n a Person (other than a corporation) and any and all warrants or
\n options to purchase any of the foregoing.<\/p>\n
“Cash Equivalents”: (a) securities with maturities of one
\n year or less from the date of acquisition issued or fully guaranteed
\n or insured by the United States Government or any agency thereof, (b)
\n certificates of deposit and eurodollar time deposits with maturities
\n of one year or less from the date of acquisition and overnight bank
\n deposits of any Lender or of any commercial bank having capital and
\n surplus in excess of $500,000,000, (c) repurchase obligations of any
\n Lender or of any commercial bank satisfying the requirements of clause
\n (b) of this definition, having a term of not more than 30 days with
\n respect to securities issued or fully guaranteed or insured by the
\n United States Government, (d) commercial paper of a domestic issuer
\n rated at least A-2 by Standard and Poor’s Rating Group (“S&P”) or P-2
\n by Moody’s Investors Service, Inc. (“Moody’s”), (e) securities with
\n maturities of one year or less from the date of acquisition issued or
\n fully guaranteed by any state, commonwealth or territory of the United
\n States, by any political subdivision or taxing authority of any such
\n state, commonwealth or territory or by any foreign government, the
\n securities of which state, commonwealth, territory, political
\n subdivision, taxing authority or foreign government (as the case may
\n be) are rated at least A by S&P or A by Moody’s, (f) securities with
\n effective maturities of one year or less from the date of acquisition
\n backed by an Aaa\/AAA insurer or standby
\n 8
\n 3<\/p>\n
letters of credit issued by any Lender or any commercial bank
\n satisfying the requirements of clause (b) of this definition, (g)
\n securities with maturities of six months or less from the date of
\n acquisition overcollateralized with United States’ Government
\n obligations as collateral or (h) shares of money market mutual or
\n similar funds which invest exclusively in assets satisfying the
\n requirements of clauses (a) through (g) of this definition.<\/p>\n
“Chase”: The Chase Manhattan Bank.<\/p>\n
“Co-Agent”: NationsBank of Texas, N.A., as co-agent for the
\n Lenders under this Agreement and the other Loan Documents.<\/p>\n
“Code”: the Internal Revenue Code of 1986, as amended from
\n time to time.<\/p>\n
“Commitment”: as to any Lender, the obligation of such Lender
\n to make Revolving Credit Loans to the Borrower hereunder in an
\n aggregate principal amount at any one time outstanding not to exceed
\n the amount set forth opposite such Lender’s name on Schedule I, as
\n such amount may be reduced from time to time in accordance with the
\n provisions of this Agreement.<\/p>\n
“Commitment Fee Rate”: on each day when the Utilization
\n Percentage is less than 50%, a rate per annum equal to .20% and on
\n each day when the Utilization Percentage is equal to or greater than
\n 50%, a rate per annum equal to .25%.<\/p>\n
“Commitment Percentage”: as to any Lender at any time, the
\n percentage which such Lender’s Commitment then constitutes of the
\n aggregate Commitments (or, at any time after the Commitments shall
\n have expired or terminated, the percentage which the aggregate
\n principal amount of such Lender’s Revolving Credit Loans then
\n outstanding constitutes of the aggregate principal amount of the
\n Revolving Credit Loans then outstanding).<\/p>\n
“Commitment Period”: the period from and including the
\n Effective Date to but not including the Termination Date or such
\n earlier date on which the Commitments shall terminate as provided
\n herein.<\/p>\n
“Commonly Controlled Entity”: an entity, whether or not
\n incorporated, which is under common control with the Borrower within
\n the meaning of Section 4001 of ERISA or is part of a group which
\n includes the Borrower and which is treated as a single employer under
\n Section 414 of the Code.<\/p>\n
“Consolidated Debt”: as of the date of determination, of any
\n Person at such date, (a) all indebtedness of such Person for borrowed
\n money or for the deferred purchase price of property or services
\n (other than current trade liabilities incurred in the ordinary course
\n of business and payable in accordance with customary practices), (b)
\n any other indebtedness of such Person which is evidenced by a note,
\n bond, debenture or similar instrument, (c) all obligations of such
\n Person under Financing Leases, (d) all obligations of such Person in
\n respect of acceptances issued or created for the account of such
\n Person and (e) all Guarantee Obligations of such Person in respect of
\n obligations described in (a), (b), (c) and (d).
\n 9
\n 4<\/p>\n
“Consolidated EBITDA”: for any period, the revenues of the
\n Borrower and its Subsidiaries for such period from continuing
\n operations, minus associated costs (generally excluding Consolidated
\n Interest Expense, income taxes, unallocated depreciation, depletion,
\n and amortization and other non-cash expenses), determined in each case
\n on a consolidated basis in accordance with GAAP.<\/p>\n
“Consolidated Fixed Charges”: for any period, the sum
\n (without duplication) of (i) Consolidated Interest Expense for such
\n period, (ii) provision for cash income taxes made by the Borrower or
\n any of its Subsidiaries on a consolidated basis in respect of such
\n period and (iii) scheduled payments made during such period on account
\n of principal of Indebtedness of the Borrower or any of its
\n Subsidiaries.<\/p>\n
“Consolidated Interest Expense:” for any period, the amount
\n of interest expense, both expensed and capitalized, of the Borrower
\n and its Subsidiaries determined on a consolidated basis in accordance
\n with GAAP, for such period on the aggregate principal amount of their
\n Indebtedness, determined on a consolidated basis in accordance with
\n GAAP.<\/p>\n
“Consolidated Net Income”: for any period, the consolidated
\n net income (or loss) of the Borrower and its Subsidiaries determined
\n on a consolidated basis in accordance with GAAP.<\/p>\n
“Consolidated Net Worth”: as of the date of determination,
\n all items which in conformity with GAAP would be included under
\n shareholders’ equity on a consolidated balance sheet of the Borrower
\n and its Subsidiaries at such date.<\/p>\n
“Consolidated Tangible Net Worth”: as of the date of
\n determination, Consolidated Net Worth after deducting therefrom the
\n following:<\/p>\n
(a) any surplus resulting from the write-up of
\n assets subsequent to December 31, 1997;<\/p>\n
(b) goodwill, including any amounts (however
\n designated on the balance sheet) representing the cost of
\n acquisitions of Subsidiaries in excess of underlying tangible
\n assets;<\/p>\n
(c) patents, trademarks, copyrights;<\/p>\n
(d) leasehold improvements not recoverable at the
\n expiration of a lease; and<\/p>\n
(e) deferred charges (including, but not limited
\n to, unamortized debt discount and expense, organization
\n expenses and experimental and development expenses, but
\n excluding prepaid expenses and expensed general and
\n administrative and geological and geophysical expenses).<\/p>\n
“Consolidated Total Capitalization”: as of the date of
\n determination, the sum of Consolidated Tangible Net Worth and
\n Consolidated Debt.
\n 10
\n 5<\/p>\n
“Contractual Obligation”: as to any Person, any provision of
\n any security issued by such Person or of any agreement, instrument or
\n other undertaking to which such Person is a party or by which it or
\n any of its property is bound.<\/p>\n
“Convertible Preferred Stock”: the $1.75 Convertible
\n Preferred Stock, Series A, of the Borrower.<\/p>\n
“Default”: any of the events specified in Section 7, whether
\n or not any requirement for the giving of notice, the lapse of time, or
\n both, or any other condition, has been satisfied.<\/p>\n
“Dollars” and “$”: dollars in lawful currency of the United
\n States of America.<\/p>\n
“Effective Date”: the date on which the conditions precedent
\n set forth in subsection 4.1 shall be satisfied.<\/p>\n
“Environmental Laws”: any and all foreign, Federal, state,
\n local or municipal laws, rules, orders, regulations, statutes,
\n ordinances, codes, decrees, requirements of any Governmental Authority
\n or other Requirements of Law (including common law) regulating,
\n relating to or imposing liability or standards of conduct concerning
\n protection of human health or the environment, as now or may at any
\n time hereafter be in effect.<\/p>\n
“ERISA”: the Employee Retirement Income Security Act of 1974,
\n as amended from time to time.<\/p>\n
“Eurocurrency Reserve Requirements”: for any day as applied
\n to a Eurodollar Loan, the aggregate (without duplication) of the rates
\n (expressed as a decimal fraction) of reserve requirements in effect on
\n such day (including, without limitation, basic, supplemental, marginal
\n and emergency reserves under any regulations of the Board of Governors
\n of the Federal Reserve System or other Governmental Authority having
\n jurisdiction with respect thereto) dealing with reserve requirements
\n prescribed for eurocurrency funding (currently referred to as
\n “Eurocurrency Liabilities” in Regulation D of such Board) maintained
\n by a member bank of such System.<\/p>\n
“Eurodollar Base Rate”: with respect to each day during each
\n Interest Period pertaining to a Eurodollar Loan, the rate per annum
\n equal to the rate at which Chase is offered Dollar deposits at or
\n about 10:00 A.M., New York City time, two Business Days prior to the
\n beginning of such Interest Period in the interbank eurodollar market
\n where the eurodollar and foreign currency and exchange operations in
\n respect of its Eurodollar Loans are then being conducted for delivery
\n on the first day of such Interest Period for the number of days
\n comprised therein and in an amount comparable to the amount of its
\n Eurodollar Loan to be outstanding during such Interest Period.<\/p>\n
“Eurodollar Loans”: Revolving Credit Loans the rate of
\n interest applicable to which is based upon the Eurodollar Rate.<\/p>\n
“Eurodollar Rate”: with respect to each day during each
\n Interest Period pertaining to a Eurodollar Loan, a rate per annum
\n determined for such day in accordance with the following formula
\n (rounded upward to the nearest 1\/100th of 1%):<\/p>\n
Eurodollar Base Rate
\n —————————————-
\n 1.00 – Eurocurrency Reserve Requirements
\n 11
\n 6<\/p>\n
“Eurodollar Tranche”: with reference to Eurodollar Loans, the
\n then current Interest Periods with respect to all of which begin on
\n the same date and end on the same later date (whether or not such
\n Loans shall originally have been made on the same day).<\/p>\n
“Event of Default”: any of the events specified in Section 7;
\n provided that any requirement for the giving of notice, the lapse of
\n time, or both, or any other condition, has been satisfied.<\/p>\n
“Existing Agreement”: the Credit Agreement, dated as of
\n December 23, 1996, as amended, supplemented or otherwise modified
\n through the Effective Date, among the Borrower, the several banks and
\n financial institutions parties thereto and The Chase Manhattan Bank,
\n as Agent.<\/p>\n
“Fee Letter”: the fee letter, dated April 10, 1998, between
\n Chase, Chase Securities Inc. and the Borrower.<\/p>\n
“Financing Lease”: any lease of property, real or personal,
\n the obligations of the lessee in respect of which are required in
\n accordance with GAAP to be capitalized on a balance sheet of the
\n lessee.<\/p>\n
“GAAP”: generally accepted accounting principles in the
\n United States of America in effect from time to time.<\/p>\n
“Governmental Authority”: any nation or government, any state
\n or other political subdivision thereof and any entity exercising
\n executive, legislative, judicial, regulatory or administrative
\n functions of or pertaining to government.<\/p>\n
“Guarantee Obligation”: as to any Person (the “guaranteeing
\n person”), any obligation of (a) the guaranteeing person or (b) another
\n Person (including, without limitation, any bank under any letter of
\n credit) to induce the creation of which the guaranteeing person has
\n issued a reimbursement, counterindemnity or similar obligation, in
\n either case guaranteeing or in effect guaranteeing any Indebtedness,
\n leases, dividends or other obligations (the “primary obligations”) of
\n any other third Person (the “primary obligor”) in any manner, whether
\n directly or indirectly, including, without limitation, any obligation
\n of the guaranteeing person, whether or not contingent, (i) to purchase
\n any such primary obligation or any property constituting direct or
\n indirect security therefor, (ii) to advance or supply funds (1) for
\n the purchase or payment of any such primary obligation or (2) to
\n maintain working capital or equity capital of the primary obligor or
\n otherwise to maintain the net worth or solvency of the primary
\n obligor, (iii) to purchase property, securities or services primarily
\n for the purpose of assuring the owner of any such primary obligation
\n of the ability of the primary obligor to make payment of such primary
\n obligation or (iv) otherwise to assure or hold harmless the owner of
\n any such primary obligation against loss in respect thereof; provided,
\n however, that the term Guarantee Obligation shall not include
\n indorsements of instruments for deposit or collection in the ordinary
\n course of business. The amount of any Guarantee Obligation of any
\n 12
\n 7<\/p>\n
guaranteeing person shall be deemed to be the lower of (a) an amount
\n equal to the stated or determinable amount of the primary obligation
\n in respect of which such Guarantee Obligation is made and (b) the
\n maximum amount for which such guaranteeing person may be liable
\n pursuant to the terms of the instrument embodying such Guarantee
\n Obligation, unless such primary obligation and the maximum amount for
\n which such guaranteeing person may be liable are not stated or
\n determinable, in which case the amount of such Guarantee Obligation
\n shall be such guaranteeing person’s maximum reasonably anticipated
\n liability in respect thereof as determined by the Borrower in good
\n faith.<\/p>\n
“Indebtedness”: of any Person at any date, (a) all
\n indebtedness of such Person for borrowed money or for the deferred
\n purchase price of property or services (other than current trade
\n liabilities incurred in the ordinary course of business and payable in
\n accordance with customary practices), (b) any other indebtedness of
\n such Person which is evidenced by a note, bond, debenture or similar
\n instrument, (c) all obligations of such Person under Financing Leases,
\n (d) all obligations of such Person in respect of acceptances issued or
\n created for the account of such Person and (e) all liabilities secured
\n by any Lien on any property owned by such Person even though such
\n Person has not assumed or otherwise become liable for the payment
\n thereof.<\/p>\n
“Independent Engineer”: Williamson Petroleum Consultants,
\n Inc., and\/or such other independent petroleum engineering company as
\n the Borrower may designate that is acceptable to the Agent and the
\n Co-Agent.<\/p>\n
“Insolvency”: with respect to any Multiemployer Plan, the
\n condition that such Plan is insolvent within the meaning of Section
\n 4245 of ERISA.<\/p>\n
“Insolvent”: pertaining to a condition of Insolvency.<\/p>\n
“Intellectual Property”: as defined in subsection 3.9.<\/p>\n
“Interest Payment Date”: (a) as to any ABR Loan, the last day
\n of each calendar month to occur while such ABR Loan is outstanding and
\n the Termination Date, (b) as to any Eurodollar Loan having an Interest
\n Period of one, two or three months, the last day of such Interest
\n Period, and (c) as to any Eurodollar Loan having an Interest Period of
\n six months, each day which is three months after the first day of such
\n Interest Period and the last day of such Interest Period.<\/p>\n
“Interest Period”: with respect to any Eurodollar Loan:<\/p>\n
(i) initially, the period commencing on the borrowing
\n or conversion date, as the case may be, with respect to such
\n Eurodollar Loan and ending one, two, three or six months
\n thereafter, as selected by the Borrower in its notice of
\n borrowing or notice of conversion, as the case may be, given
\n with respect thereto; and<\/p>\n
(ii) thereafter, each period commencing on the last
\n day of the next preceding Interest Period applicable to such
\n Eurodollar Loan and ending one, two, three or six months
\n thereafter, as selected by the Borrower by irrevocable notice
\n 13
\n 8<\/p>\n
to the Agent not less than three Business Days prior to the
\n last day of the then current Interest Period with respect
\n thereto;<\/p>\n
provided that, all of the foregoing provisions relating to Interest
\n Periods are subject to the following:<\/p>\n
(1) if any Interest Period pertaining to a
\n Eurodollar Loan would otherwise end on a day that is not a
\n Business Day, such Interest Period shall be extended to the
\n next succeeding Business Day unless the result of such
\n extension would be to carry such Interest Period into another
\n calendar month in which event such Interest Period shall end
\n on the immediately preceding Business Day;<\/p>\n
(2) any Interest Period that would otherwise extend
\n beyond the Termination Date shall end on the Termination Date;
\n and<\/p>\n
(3) any Interest Period pertaining to a Eurodollar
\n Loan that begins on the last Business Day of a calendar month
\n (or on a day for which there is no numerically corresponding
\n day in the calendar month at the end of such Interest Period)
\n shall end on the last Business Day of a calendar month.<\/p>\n
“Interest Rate Protection Agreement”: any interest rate
\n protection agreement, interest rate futures contract, interest rate
\n option, interest rate cap, interest rate swap or other interest rate
\n hedge arrangement, to or under which the Borrower or any of its
\n Subsidiaries is a party or a beneficiary on the date hereof or becomes
\n a party or a beneficiary after the date hereof.<\/p>\n
“KNE”: K N Energy, Inc., a Kansas corporation.<\/p>\n
“Lien”: any mortgage, pledge, hypothecation, assignment,
\n deposit arrangement, encumbrance, lien (statutory or other), charge or
\n other security interest or any preference, priority or other security
\n agreement or preferential arrangement of any kind or nature whatsoever
\n (including, without limitation, any conditional sale or other title
\n retention agreement and any Financing Lease having substantially the
\n same economic effect as any of the foregoing).<\/p>\n
“Loan Documents”: this Agreement, the Subsidiaries Guarantee
\n and any Notes.<\/p>\n
“Majority Lenders”: at any time, Lenders the Commitment
\n Percentages of which aggregate more than 50%.<\/p>\n
“Material Adverse Effect”: a material adverse effect on (a)
\n the business, operations, property, condition (financial or
\n otherwise), results of operations, assets, liabilities or prospects of
\n the Borrower and its Subsidiaries taken as a whole, (b) the ability of
\n the Borrower to perform any of its obligations under the Loan
\n Documents or (c) the validity or enforceability of this or any of the
\n other Loan Documents or the rights or remedies of the Agent or the
\n Lenders hereunder or thereunder.<\/p>\n
“Material Environmental Amount”: an amount not otherwise
\n covered by insurance payable by the Borrower and\/or its Subsidiaries
\n in excess of $5,000,000 for
\n 14
\n 9<\/p>\n
remedial costs, compliance costs, compensatory damages, punitive
\n damages, fines, penalties or any combination thereof.<\/p>\n
“Materials of Environmental Concern”: any hazardous or toxic
\n substances, materials or wastes, defined or regulated as such in or
\n under any Environmental Law, including, without limitation, asbestos,
\n polychlorinated biphenyls and urea-formaldehyde insulation.<\/p>\n
“Maximum Loan Amount”: $75,000,000, or such lesser amount to
\n which the aggregate Commitments may be reduced pursuant to subsection
\n 2.4 hereof.<\/p>\n
“Multiemployer Plan”: a Plan which is a multiemployer plan as
\n defined in Section 4001(a)(3) of ERISA.<\/p>\n
“Net Cash Proceeds”: means, with respect to any sale or other
\n disposition of securities, the cash proceeds (including cash
\n equivalents and any cash payments received by way of deferred payment
\n of principal pursuant to a note or installment receivable or purchase
\n price adjustment receivable or otherwise, but only as and when
\n received) of such sale or other disposition received by the Borrower
\n or any of its Subsidiaries, net of all attorneys’ fees, accountants’
\n fees, investment banking fees and other customary fees actually
\n incurred by the Borrower or any of its Subsidiaries and documented in
\n connection therewith and net of taxes paid or reasonably expected to
\n be payable by the Borrower or any of its Subsidiaries as a result
\n thereof.<\/p>\n
“Non-Excluded Taxes”: as defined in subsection 2.16.<\/p>\n
“Notes”: the Revolving Credit Notes.<\/p>\n
“Optional Reserve Report”: as defined in subsection
\n 2.6(b)(ii).<\/p>\n
“Participant”: as defined in subsection 9.6(b).<\/p>\n
“Partnership”: Wind River – Pavillion, Ltd., a Texas limited
\n partnership.<\/p>\n
“PBGC”: the Pension Benefit Guaranty Corporation established
\n pursuant to Subtitle A of Title IV of ERISA.<\/p>\n
“Person”: an individual, partnership, corporation, business
\n trust, joint stock company, trust, unincorporated association, joint
\n venture, Governmental Authority or other entity of whatever nature.<\/p>\n
“Petroleum”: oil, gas and other liquid or gaseous
\n hydrocarbons, including, without limitation, all liquefiable
\n hydrocarbons and other products which may be extracted from gas and
\n gas condensate by the processing thereof in a gas processing plant.<\/p>\n
“Petroleum Price Hedge Agreement”: any hedge arrangement,
\n commodity swap agreement, commodity futures, forwards, options, and
\n other similar agreements relating to Petroleum.
\n 15
\n 10<\/p>\n
“Plan”: at a particular time, any employee benefit plan which
\n is covered by ERISA and in respect of which the Borrower or a Commonly
\n Controlled Entity is (or, if such plan were terminated at such time,
\n would under Section 4069 of ERISA be deemed to be) an “employer” as
\n defined in Section 3(5) of ERISA.<\/p>\n
“Properties”: as defined in subsection 3.16(a).<\/p>\n
“Register”: as defined in subsection 9.6(d).<\/p>\n
“Regulation U”: Regulation U of the Board of Governors of the
\n Federal Reserve System as in effect from time to time.<\/p>\n
“Reorganization”: with respect to any Multiemployer Plan, the
\n condition that such plan is in reorganization within the meaning of
\n Section 4241 of ERISA.<\/p>\n
“Reportable Event”: any of the events set forth in Section
\n 4043(b) of ERISA, other than those events as to which the thirty day
\n notice period is waived under subsections .13, .14, .16, .18, .19 or
\n .20 of PBGC Reg. ‘ 2615.<\/p>\n
“Required Lenders”: at any time, Lenders the Commitment
\n Percentages of which aggregate at least 66-2\/3%.<\/p>\n
“Requirement of Law”: as to any Person, the Certificate of
\n Incorporation and By-Laws or other organizational or governing
\n documents of such Person, and any law, treaty, rule or regulation or
\n determination of an arbitrator or a court or other Governmental
\n Authority, in each case applicable to or binding upon such Person or
\n any of its property or to which such Person or any of its property is
\n subject.<\/p>\n
“Reserve Report”: as defined in subsection 2.6(b).<\/p>\n
“Responsible Officer”: the Chairman of the Board of
\n Directors, President or Executive Vice-President of the Borrower or,
\n with respect to financial matters, the Chief Financial Officer or the
\n principal accounting or financial officer of the Borrower.<\/p>\n
“Retex”: Retex Gathering Company, Inc., a Wyoming
\n corporation.<\/p>\n
“Revolving Credit Loans”: as defined in subsection 2.1.<\/p>\n
“Revolving Credit Note”: as defined in subsection 2.5(e).<\/p>\n
“Single Employer Plan”: any Plan which is covered by Title IV
\n of ERISA, but which is not a Multiemployer Plan.<\/p>\n
“Subsidiary”: as to any Person, a corporation, partnership or
\n other entity of which shares of stock or other ownership interests
\n having ordinary voting power (other than stock or such other ownership
\n interests having such power only by reason of the happening of a
\n contingency) to elect a majority of the board of directors or other
\n managers of such corporation, partnership or other entity are at the
\n time owned, or the management of which is otherwise controlled,
\n directly or indirectly through one or more
\n 16
\n 11<\/p>\n
intermediaries, or both, by such Person. Unless otherwise qualified,
\n all references to a “Subsidiary” or to “Subsidiaries” in this
\n Agreement shall refer to a Subsidiary or Subsidiaries of the Borrower.<\/p>\n
“Subsidiary Guarantor”: each of TBI Production Company, TBI
\n Exploration Inc. and TBI West Virginia Inc.<\/p>\n
“Subsidiaries Guarantee”: the Subsidiaries Guarantee, to be
\n entered into by each Subsidiary Guarantor, substantially in the form
\n of Exhibit B attached hereto as the same may be amended, supplemented
\n or otherwise modified from time to time.<\/p>\n
“Termination Date”: the third anniversary of the Effective
\n Date.<\/p>\n
“Transferee”: as defined in subsection 9.6(f).<\/p>\n
“Type”: as to any Revolving Credit Loan, its nature as an ABR
\n Loan or a Eurodollar Loan.<\/p>\n
“Utilization Percentage”: on any day, the aggregate
\n outstanding principal amount of the Revolving Credit Loans outstanding
\n on such date divided by the Borrowing Base on such date.<\/p>\n
“Wildhorse”: Wildhorse Energy Partners, LLC, a Delaware
\n limited liability company.<\/p>\n
“Wildhorse Limited Liability Company Agreement”: the Limited
\n Liability Company Agreement between KNE and the Borrower for the
\n formation of Wildhorse, dated January 31, 1996 and delivered by the
\n Borrower to the Lenders.<\/p>\n
“Wind River Joint Venture”: the joint venture between Retex
\n and K N Gas Gathering, Inc., pursuant to the Wind River Joint Venture
\n Agreement.<\/p>\n
“Wind River Joint Venture Agreement”: the Amended and
\n Restated Joint Venture Agreement, dated June 1, 1993, between Retex
\n and K N Gas Gathering, Inc., a Colorado corporation.<\/p>\n
1.2 Other Definitional Provisions. (a) Unless otherwise
\nspecified therein, all terms defined in this Agreement shall have the defined
\nmeanings when used in any Notes or any certificate or other document made or
\ndelivered pursuant hereto.<\/p>\n
(b) As used herein and in any Notes, and any certificate or
\nother document made or delivered pursuant hereto, accounting terms relating to
\nthe Borrower and its Subsidiaries not defined in subsection 1.1 and accounting
\nterms partly defined in subsection 1.1, to the extent not defined, shall have
\nthe respective meanings given to them under GAAP.<\/p>\n
(c) The words “hereof”, “herein” and “hereunder” and words of
\nsimilar import when used in this Agreement shall refer to this Agreement as a
\nwhole and not to any particular provision of this Agreement, and Section,
\nsubsection, Schedule and Exhibit references are to this Agreement unless
\notherwise specified.
\n 17
\n 12<\/p>\n
(d) The meanings given to terms defined herein shall be
\nequally applicable to both the singular and plural forms of such terms.<\/p>\n
SECTION 2. AMOUNT AND TERMS OF COMMITMENTS<\/p>\n
2.1 Commitments. (a) Subject to the terms and conditions
\nhereof (including, without limitation, Section 4.2(c)), each Lender severally
\nagrees to make revolving credit loans (“Revolving Credit Loans”) to the
\nBorrower from time to time during the Commitment Period in an aggregate
\nprincipal amount at any one time outstanding not to exceed the amount of such
\nLender’s Commitment Percentage of the Available Commitment. During the
\nCommitment Period the Borrower may use the Commitments by borrowing, prepaying
\nthe Revolving Credit Loans in whole or in part, and reborrowing, all in
\naccordance with the terms and conditions hereof.<\/p>\n
(b) The Revolving Credit Loans may from time to time be
\n(i) Eurodollar Loans, (ii) ABR Loans or (iii) a combination thereof, as
\ndetermined by the Borrower and notified to the Agent in accordance with
\nsubsections 2.2 and 2.8; provided that no Revolving Credit Loan shall be made
\nas a Eurodollar Loan after the day that is one month prior to the Termination
\nDate.<\/p>\n
2.2 Procedure for Revolving Credit Borrowing. The Borrower
\nmay borrow under the Commitments during the Commitment Period on any Business
\nDay; provided that the Borrower shall give the Agent irrevocable notice (which
\nnotice must be received by the Agent prior to 10:00 A.M., New York City time,
\n(a) three Business Days prior to the requested Borrowing Date, if all or any
\npart of the requested Revolving Credit Loans are to be initially Eurodollar
\nLoans, or (b) one Business Day prior to the requested Borrowing Date,
\notherwise), specifying (i) the amount to be borrowed, (ii) the requested
\nBorrowing Date, (iii) whether the borrowing is to be of Eurodollar Loans, ABR
\nLoans, or a combination thereof and (iv) if the borrowing is to be entirely or
\npartly of Eurodollar Loans, the respective amounts of each such Type of
\nRevolving Credit Loan and the respective lengths of the initial Interest
\nPeriods therefor. Each borrowing under the Commitments shall be in an amount
\nequal to (x) in the case of ABR Loans, $500,000 or a whole multiple thereof and
\n(y) in the case of Eurodollar Loans, $1,000,000 or a whole multiple of $100,000
\nin excess thereof. Upon receipt of any such notice from the Borrower, the
\nAgent shall promptly notify each Lender thereof. Each Lender will make the
\namount of its pro rata share of each borrowing available to the Agent for the
\naccount of the Borrower at the office of the Agent specified in subsection 9.2
\nprior to 11:00 A.M., New York City time, on the Borrowing Date requested by the
\nBorrower in funds immediately available to the Agent. Such borrowing will then
\nbe made available to the Borrower by the Agent crediting the account of the
\nBorrower on the books of such office with the aggregate of the amounts made
\navailable to the Agent by the Lenders and in like funds as received by the
\nAgent.<\/p>\n
2.3 Fees. The Borrower agrees to pay to the Agent for the
\naccount of the Lenders a commitment fee for the period from and including the
\nfirst day of the Commitment Period to the Termination Date, computed at the
\nCommitment Fee Rate on the average daily amount of the unutilized part of the
\nAvailable Commitment of such Lender during the period for which payment is
\nmade, payable quarterly in arrears on the last day of each March, June,
\nSeptember and December and on the Termination Date or such earlier date as the
\nCommitments shall terminate as provided herein, commencing on the first of such
\ndates to occur after the date hereof.
\n 18
\n 13<\/p>\n
2.4 Termination or Reduction of Commitments. The Borrower
\nshall have the right, upon not less than five Business Days’ notice to the
\nAgent, to terminate the Commitments or, from time to time, to reduce the amount
\nof the Commitments. Any such reduction shall be in an amount equal to
\n$1,000,000 or a whole multiple thereof and shall reduce permanently the
\nCommitments then in effect.<\/p>\n
2.5 Repayment of Revolving Credits; Evidence of Debt. (a)
\nThe Borrower hereby unconditionally promises to pay to the Agent for the
\naccount of each Lender the then unpaid principal amount of each Revolving
\nCredit Loan of such Lender in full on the Termination Date (or such earlier
\ndate on which the Revolving Credit Loans become due and payable pursuant to
\nSection 7). The Borrower hereby further agrees to pay interest on the unpaid
\nprincipal amount of the Revolving Credit Loans from time to time outstanding
\nfrom the date hereof until payment in full thereof at the rates per annum, and
\non the dates, set forth in subsection 2.10.<\/p>\n
(b) Each Lender shall maintain in accordance with its usual
\npractice an account or accounts evidencing indebtedness of the Borrower to such
\nLender resulting from each Revolving Credit Loan of such Lender from time to
\ntime, including the amounts of principal and interest payable and paid to such
\nLender from time to time under this Agreement.<\/p>\n
(c) The Agent shall maintain the Register pursuant to
\nsubsection 9.6(d), and a subaccount therein for each Lender, in which shall be
\nrecorded (i) the amount of each Revolving Credit Loan made hereunder, the Type
\nthereof and each Interest Period applicable thereto, (ii) the amount of any
\nprincipal or interest due and payable or to become due and payable from the
\nBorrower to each Lender hereunder and (iii) both the amount of any sum received
\nby the Agent hereunder from the Borrower and each Lender’s share thereof.<\/p>\n
(d) The entries made in the Register and the accounts of each
\nLender maintained pursuant to subsection 2.5(b) shall, to the extent permitted
\nby applicable law, be prima facie evidence of the existence and amounts of the
\nobligations of the Borrower therein recorded; provided, however, that the
\nfailure of any Lender or the Agent to maintain the Register or any such
\naccount, or any error therein, shall not in any manner affect the obligation of
\nthe Borrower to repay (with applicable interest) the Revolving Credit Loans
\nmade to such Borrower by such Lender in accordance with the terms of this
\nAgreement.<\/p>\n
(e) The Borrower agrees that the Borrower will execute and
\ndeliver to each Lender a promissory note of the Borrower evidencing the
\nRevolving Credit Loans of such Lender, substantially in the form of Exhibit A
\nwith appropriate insertions as to date and principal amount (a “Revolving
\nCredit Note”).<\/p>\n
2.6 Borrowing Base. The Borrowing Base shall be determined
\nas follows:<\/p>\n
(a) Initial Borrowing Base. The amount of the Borrowing Base
\nshall be $130,000,000 during the period from the Effective Date to the date on
\nwhich the Borrower receives notice of the first determination of the Borrowing
\nBase by the Agent and the Co-Agent pursuant to subsection 2.6(b) and thereafter
\nthe amount of the Borrowing Base shall be the Borrowing Base most recently
\ndetermined pursuant to subsection 2.6(b).
\n 19
\n 14<\/p>\n
(b) Determinations of the Borrowing Base. (i) No later than
\n45 days after June 30 and December 31 of each calendar year, commencing June
\n30, 1998, the Borrower shall, at its own expense, furnish to the Agent, the
\nCo-Agent and the Lenders a report (“Reserve Report”), in a form and substance
\nreasonably satisfactory to the Agent and the Co-Agent which report shall be
\ndated as of such June 30 or December 31 and shall set forth the Borrower’s and
\nits Subsidiary Guarantors’ interest (broken down by category) in all Borrowing
\nBase Assets and, in the case of the December 31 report only, a projection of
\nthe rate of production and net operating income with respect thereto as of such
\ndate. Each June 30 Reserve Report shall be prepared by the Borrower and each
\nDecember 31 Reserve Report shall be prepared or audited by the Independent
\nEngineer. Each June 30 Reserve Report may be prepared in summary form and
\nshall include a review of any material production variances, if any, from the
\nimmediately preceding December 31 Reserve Report.<\/p>\n
(ii) At any date the Borrower may at its expense
\nfurnish additional Reserve Reports to the Agent and the Co-Agent (“Optional
\nReserve Reports”), which Optional Reserve Reports need not be prepared or
\naudited by an independent petroleum engineer (unless the Agent or the Co-Agent
\nso requests), each dated a date other than June 30 or December 31.<\/p>\n
(iii) Notwithstanding the provisions of subsection
\n2.6(b)(i), upon the Borrower’s written request, and upon submission of an
\nOptional Reserve Report, the Agent and the Co-Agent shall review the Borrowing
\nBase and make any adjustments thereto they deem appropriate under the
\ncircumstances; provided that in no event shall the Agent and the Co-Agent be
\nrequired to make more than two such unscheduled Borrowing Base determinations
\nduring any calendar year.<\/p>\n
(iv) Within forty-five days after they both
\nreceive each Reserve Report or Optional Reserve Report, the Agent and the
\nCo-Agent shall make a determination of the Borrowing Base provided that such
\ndetermination shall be approved by the Required Lenders, and shall notify the
\nBorrower of the new Borrowing Base, if any.<\/p>\n
(v) Within forty-five days after the Borrower has
\nnotified the Agent and the Co-Agent pursuant to subsection 2.7(c) that it or
\nany Subsidiary Guarantor has determined to sell or otherwise dispose of any of
\nthe Borrowing Base Assets (other than sales permitted by subsections 6.6(a),
\n(b), (c), (d) and (e)), the Agent and the Co-Agent shall make a redetermination
\nof the Borrowing Base, and shall notify the Borrower of the new Borrowing Base,
\nif any; provided that such redetermination and notification shall occur only if
\nthe aggregate amount of consideration paid for Borrowing Base Assets disposed
\nof since the last determination of the Borrowing Base exceeds $5,000,000.<\/p>\n
(vi) The Borrower agrees to pay or reimburse the
\nAgent and the Co-Agent for all reasonable out-of-pocket costs and expenses
\nincurred in connection with (a) the examination of each Optional Reserve Report
\nfurnished to the Agent and the Co-Agent by the Borrower, (b) the determination
\nof the Borrowing Base pursuant to such Reserve Report or Optional Reserve
\nReport, (c) the redetermination of the Borrowing Base pursuant to subsection
\n2.6(b)(v) and (d) the notification of the Borrower of such Borrowing Base.<\/p>\n
(vii) Each determination of the Borrowing Base
\nshall be made by the Agent and the Co-Agent in the exercise of their sole
\ndiscretion in accordance with the then current standards and practices of the
\nAgent and the Co-Agent for similar oil and gas loans,
\n 20
\n 15<\/p>\n
taking into account such factors as the Agent and the Co-Agent may deem
\nappropriate, including, without limitation the nature and extent of the
\nBorrower’s interest in the Borrowing Base Assets and the anticipated timing and
\nextent of net operating income therefrom; provided that each such determination
\nshall be approved by the Required Lenders. The Agent and the Co-Agent may in
\ntheir sole discretion discount the value of any Borrowing Base Asset set forth
\nin a Reserve Report or an Optional Reserve Report by the same factors utilized
\nby it in discounting the value of comparable borrowing base assets in
\ncomparable transactions.<\/p>\n
(viii) Each delivery by the Borrower to the Agent and
\nthe Co-Agent of a Reserve Report or an Optional Reserve Report shall be deemed
\nto constitute a representation and warranty by the Borrower to the Agent and the
\nCo-Agent that the Borrower or the Subsidiary Guarantors, to the extent of the
\ninterest specified in such report (and subject to exceptions disclosed in
\nwriting to the Agent and the Co-Agent by the Borrower), has good and marketable
\ntitle to the Borrowing Base Assets and any other property rights or interests
\ndescribed in such report, and that none of such Borrowing Base Assets or other
\nproperty rights or interests is subject to any Lien other than as permitted by
\nsubsection 6.3.<\/p>\n
2.7 Optional and Mandatory Prepayments. (a) The Borrower
\nmay at any time and from time to time prepay the Revolving Credit Loans, in
\nwhole or in part, without premium or penalty (subject to subsection 2.17), upon
\nat least four Business Days’ irrevocable notice to the Agent, specifying the
\ndate and amount of prepayment and whether the prepayment is of Eurodollar
\nLoans, ABR Loans or a combination thereof, and, if of a combination thereof,
\nthe amount allocable to each. Upon receipt of any such notice the Agent shall
\npromptly notify each Lender thereof. If any such notice is given, the amount
\nspecified in such notice shall be due and payable on the date specified
\ntherein, together with any amounts payable pursuant to subsection 2.17.
\nPartial prepayments shall be in an aggregate principal amount of $1,000,000 or
\na whole multiple thereof.<\/p>\n
(b) In the event the aggregate unpaid principal amount of the
\nRevolving Credit Loans shall at any time be in excess of the Borrowing Base at
\nsuch time, the Agent shall so notify the Borrower, and the Borrower shall,
\nwithin 30 days after such notification, either (i) prepay the principal of the
\nRevolving Credit Loans, in an aggregate amount at least equal to such excess,
\ntogether with accrued interest on the amount prepaid to the date of such
\nprepayment or (ii) take such actions as may be approved by the Agent and the
\nCo-Agent in their sole discretion to increase the Borrowing Base by the amount
\nof such excess in a manner satisfactory to the Agent and the Co-Agent.<\/p>\n
(c) In the event the Borrower or any Subsidiary Guarantor
\ndetermines to sell or otherwise dispose of any of the Borrowing Base Assets
\n(other than sales permitted by subsections 6.6 (a), (b), (c), (d) and (e)), the
\nBorrower shall immediately notify the Agent and the Co-Agent (but in no event
\nlater than five Business Days prior to the date of such sale or disposition)
\nand, no later than three Business Days following the consummation of such sale
\nor disposition, the Borrower shall prepay the Revolving Credit Loans in an
\naggregate amount equal to the net proceeds of such sale or disposition;
\nprovided that no later than three Business Days following the redetermination
\nof the Borrowing Base by the Agent and the Co-Agent to reflect such sale or
\ndisposition to the extent required by subsection 2.6(b)(v), the Borrower shall
\nadditionally prepay the Revolving Credit Loans in an aggregate amount equal to
\nthe excess, if any, of (i) the aggregate principal amount of outstanding
\nRevolving Credit Loans after reflecting payment of the net proceeds of such
\nasset sale or disposition over (ii) the Borrowing Base as
\n 21
\n 16<\/p>\n
redetermined by the Agent and the Co-Agent to reflect such sale or disposition.<\/p>\n
(d) In the event that both ABR Loans and Eurodollar Loans are
\noutstanding on the date of any such mandatory prepayment made in accordance
\nwith the terms of paragraph (b) or (c) of this Section 2.7, the Borrower shall
\napply such mandatory prepayment first to prepay any or all of such outstanding
\nABR Loans and next to prepay any or all of such outstanding Eurodollar Loans;
\nprovided that in the event the Borrower shall apply such mandatory prepayment
\nto prepay a Eurodollar Loan on a date other than the last day of an Interest
\nPeriod with respect thereto, any losses or costs incurred by the Lenders shall
\nbe indemnified by the Borrower in accordance with the provisions of Section
\n2.17.<\/p>\n
2.8 Conversion and Continuation Options. (a) The Borrower
\nmay elect from time to time to convert Eurodollar Loans to ABR Loans by giving
\nthe Agent at least two Business Days’ prior irrevocable notice of such
\nelection; provided that any such conversion of Eurodollar Loans may only be
\nmade on the last day of an Interest Period with respect thereto. The Borrower
\nmay elect from time to time to convert ABR Loans to Eurodollar Loans by giving
\nthe Agent at least three Business Days’ prior irrevocable notice of such
\nelection. Any such notice of conversion to Eurodollar Loans shall specify the
\nlength of the initial Interest Period or Interest Periods therefor. Upon
\nreceipt of any such notice the Agent shall promptly notify each Lender thereof.
\nAll or any part of outstanding Eurodollar Loans and ABR Loans may be converted
\nas provided herein; provided that (i) no Revolving Credit Loan may be converted
\ninto a Eurodollar Loan when any Event of Default has occurred and is continuing
\nand the Agent has or the Required Lenders have determined that such a
\nconversion is not appropriate and (ii) no Revolving Credit Loan may be
\nconverted into a Eurodollar Loan after the date that is one month prior to the
\nTermination Date.<\/p>\n
(b) Any Eurodollar Loans may be continued as such upon the
\nexpiration of the then current Interest Period with respect thereto by the
\nBorrower giving notice to the Agent, in accordance with the applicable
\nprovisions of the term “Interest Period” set forth in subsection 1.1, of the
\nlength of the next Interest Period to be applicable to such Revolving Credit
\nLoans; provided that no Eurodollar Loan may be continued as such (i) when any
\nEvent of Default has occurred and is continuing and the Agent has or the
\nRequired Lenders have determined that such a continuation is not appropriate or
\n(ii) after the date that is one month prior to the Termination Date; and
\nprovided, further, that if the Borrower shall fail to give such notice or if
\nsuch continuation is not permitted such Revolving Credit Loans shall be
\nautomatically converted to ABR Loans on the last day of such then expiring
\nInterest Period.<\/p>\n
2.9 Minimum Amounts and Maximum Number of Tranches. All
\nborrowings, conversions and continuations of Revolving Credit Loans hereunder
\nand all selections of Interest Periods hereunder shall be in such amounts and
\nbe made pursuant to such elections so that, after giving effect thereto, the
\naggregate principal amount of the Revolving Credit Loans comprising each
\nEurodollar Tranche shall be equal to $1,000,000 or a whole multiple of $100,000
\nin excess thereof. In no event shall there be more than eight Eurodollar
\nTranches outstanding at any time.<\/p>\n
2.10 Interest Rates and Payment Dates. (a) Each Eurodollar
\nLoan shall bear interest for each day during each Interest Period with respect
\nthereto at a rate per annum equal to the Eurodollar Rate determined for such
\nday plus the Applicable Margin.<\/p>\n
(b) Each ABR Loan shall bear interest at a rate per annum
\nequal to the ABR.
\n 22
\n 17<\/p>\n
(c) If all or a portion of (i) any principal of any Revolving
\nCredit Loan, (ii) any interest payable thereon, (iii) any commitment fee or
\n(iv) any other amount payable hereunder shall not be paid when due (whether at
\nthe stated maturity, by acceleration or otherwise), the principal of the
\nRevolving Credit Loans and any such overdue interest, commitment fee or other
\namount shall bear interest at a rate per annum which is (x) in the case of
\nprincipal, the rate that would otherwise be applicable thereto pursuant to the
\nforegoing provisions of this subsection plus 2% or (y) in the case of any such
\noverdue interest, commitment fee or other amount, the rate described in
\nparagraph (b) of this subsection plus 2%, in each case from the date of such
\nnon-payment until such overdue principal, interest, commitment fee or other
\namount is paid in full (as well after as before judgment).<\/p>\n
(d) Interest shall be payable in arrears on each Interest
\nPayment Date; provided that interest accruing pursuant to paragraph (c) of this
\nsubsection shall be payable from time to time on demand.<\/p>\n
2.11 Computation of Interest and Fees. (a) Commitment fees
\nand, whenever it is calculated on the basis of the Prime Rate, interest shall
\nbe calculated on the basis of a 365-(or 366-, as the case may be) day year for
\nthe actual days elapsed; and, otherwise, interest shall be calculated on the
\nbasis of a 360-day year for the actual days elapsed. The Agent shall as soon
\nas practicable notify the Borrower and the Lenders of each determination of a
\nEurodollar Rate. Any change in the interest rate on a Revolving Credit Loan
\nresulting from a change in the ABR or the Eurocurrency Reserve Requirements
\nshall become effective as of the opening of business on the day on which such
\nchange becomes effective. The Agent shall as soon as practicable notify the
\nBorrower and the Lenders of the effective date and the amount of each such
\nchange in interest rate.<\/p>\n
(b) Each determination of an interest rate by the Agent
\npursuant to any provision of this Agreement shall be conclusive and binding on
\nthe Borrower and the Lenders in the absence of manifest error. The Agent
\nshall, at the request of the Borrower, deliver to the Borrower a statement
\nshowing the quotations used by the Agent in determining any interest rate
\npursuant to subsection 2.10(a).<\/p>\n
2.12 Inability to Determine Interest Rate. If prior to the
\nfirst day of any Interest Period:<\/p>\n
(a) the Agent shall have determined (which determination
\n shall be conclusive and binding upon the Borrower) that, by reason of
\n circumstances affecting the relevant market, adequate and reasonable
\n means do not exist for ascertaining the Eurodollar Rate for such
\n Interest Period, or<\/p>\n
(b) the Agent shall have received notice from the Majority
\n Lenders that the Eurodollar Rate to be determined for such Interest
\n Period will not adequately and fairly reflect the cost to such Lenders
\n (as conclusively certified by such Lenders) of making or maintaining
\n their affected Revolving Credit Loans during such Interest Period,<\/p>\n
the Agent shall give telecopy or telephonic notice thereof to the Borrower and
\nthe Lenders as soon as practicable thereafter. If such notice is given (x) any
\nEurodollar Loans requested to be made on the first day of such Interest Period
\nshall be made as ABR Loans, (y) any Revolving
\n 23
\n 18<\/p>\n
Credit Loans that were to have been converted on the first day of such Interest
\nPeriod to Eurodollar Loans shall be converted to or continued as ABR Loans and
\n(z) any outstanding Eurodollar Loans shall be converted, on the first day of
\nsuch Interest Period, to ABR Loans. Until such notice has been withdrawn by
\nthe Agent, no further Eurodollar Loans shall be made or continued as such, nor
\nshall the Borrower have the right to convert Revolving Credit Loans to
\nEurodollar Loans.<\/p>\n
2.13 Pro Rata Treatment and Payments. (a) Each borrowing by
\nthe Borrower from the Lenders hereunder, each payment by the Borrower on
\naccount of any commitment fee hereunder and any reduction of the Commitments of
\nthe Lenders shall be made pro rata according to the respective Commitment
\nPercentages of the Lenders. Each payment (including each prepayment) by the
\nBorrower on account of principal of and interest on the Revolving Credit Loans
\nshall be made to the Agent and allocated to the Lenders pro rata according to
\nthe respective outstanding principal amounts of the Revolving Credit Loans then
\nheld by the Lenders. All payments (including prepayments) to be made by the
\nBorrower hereunder, whether on account of principal, interest, fees or
\notherwise, shall be made without set off or counterclaim and shall be made
\nprior to 12:00 Noon, New York City time, on the due date thereof to the Agent,
\nfor the account of the Lenders, at the Agent’s office specified in subsection
\n9.2, in Dollars and in immediately available funds. The Agent shall distribute
\nsuch payments to the Lenders promptly upon receipt in like funds as received.
\nIf any payment hereunder becomes due and payable on a day other than a Business
\nDay, such payment shall be extended to the next succeeding Business Day, and,
\nwith respect to payments of principal, interest thereon shall be payable at the
\nthen applicable rate during such extension.<\/p>\n
(b) Unless the Agent shall have been notified in writing by
\nany Lender prior to a borrowing that such Lender will not make the amount that
\nwould constitute its Commitment Percentage of such borrowing available to the
\nAgent, the Agent may assume that such Lender is making such amount available to
\nthe Agent, and the Agent may, in reliance upon such assumption, make available
\nto the Borrower a corresponding amount. If such amount is not made available
\nto the Agent by the required time on the Borrowing Date therefor, such Lender
\nshall pay to the Agent, on demand, such amount with interest thereon at a rate
\nequal to the daily average Federal Funds Effective Rate for the period until
\nsuch Lender makes such amount immediately available to the Agent. A
\ncertificate of the Agent submitted to any Lender with respect to any amounts
\nowing under this subsection shall be conclusive in the absence of manifest
\nerror. If such Lender’s Commitment Percentage of such borrowing is not made
\navailable to the Agent by such Lender within three Business Days of such
\nBorrowing Date, the Agent shall also be entitled to recover such amount with
\ninterest thereon at the rate per annum applicable to ABR Loans hereunder, on
\ndemand, from the Borrower.<\/p>\n
2.14 Illegality. Notwithstanding any other provision herein,
\nif the adoption of or any change in any Requirement of Law or in the
\ninterpretation or application thereof shall make it unlawful for any Lender to
\nmake or maintain Eurodollar Loans as contemplated by this Agreement, (a) the
\ncommitment of such Lender hereunder to make Eurodollar Loans, continue
\nEurodollar Loans as such and convert ABR Loans to Eurodollar Loans shall
\nforthwith be cancelled and (b) such Lender’s Revolving Credit Loans then
\noutstanding as Eurodollar Loans, if any, shall be converted automatically to
\nABR Loans on the respective last days of the then current Interest Periods with
\nrespect to such Revolving Credit Loans or within such earlier period as
\nrequired by law. If any such conversion of a Eurodollar Loan occurs on a day
\nwhich is not the last day of the then current Interest Period with respect
\nthereto, the Borrower shall pay to such
\n 24
\n 19<\/p>\n
Lender such amounts, if any, as may be required pursuant to subsection 2.17.<\/p>\n
2.15 Requirements of Law. (a) If the adoption of or any
\nchange in any Requirement of Law or in the interpretation or application
\nthereof or compliance by any Lender with any request or directive (whether or
\nnot having the force of law) from any central bank or other Governmental
\nAuthority made subsequent to the date hereof:<\/p>\n
(i) shall subject any Lender to any tax of any kind
\n whatsoever with respect to this Agreement, any Note or any Eurodollar
\n Loan, or change the basis of taxation of payments to such Lender in
\n respect thereof (except for Non-Excluded Taxes covered by subsection
\n 2.16 and changes in the rate of tax on the overall net income of such
\n Lender);<\/p>\n
(ii) shall impose, modify or hold applicable any reserve,
\n special deposit, compulsory loan or similar requirement against assets
\n held by, deposits or other liabilities in or for the account of,
\n advances, loans or other extensions of credit by, or any other
\n acquisition of funds by, any office of such Lender which is not
\n otherwise included in the determination of the Eurodollar Rate; or<\/p>\n
(iii) shall impose on such Lender any other condition;<\/p>\n
and the result of any of the foregoing is to increase the cost to such Lender,
\nby an amount which such Lender deems to be material, of making, converting
\ninto, continuing or maintaining Eurodollar Loans or to reduce any amount
\nreceivable hereunder in respect thereof, then, in any such case, the Borrower
\nshall promptly pay such Lender such additional amount or amounts as will
\ncompensate such Lender for such increased cost or reduced amount receivable.<\/p>\n
(b) If any Lender shall have determined that the adoption of
\nor any change in any Requirement of Law regarding capital adequacy or in the
\ninterpretation or application thereof or compliance by such Lender or any
\ncorporation controlling such Lender with any request or directive regarding
\ncapital adequacy (whether or not having the force of law) from any Governmental
\nAuthority made subsequent to the date hereof shall have the effect of reducing
\nthe rate of return on such Lender’s or such corporation’s capital as a
\nconsequence of its obligations hereunder to a level below that which such
\nLender or such corporation could have achieved but for such adoption, change or
\ncompliance (taking into consideration such Lender’s or such corporation’s
\npolicies with respect to capital adequacy) by an amount deemed by such Lender
\nto be material, then from time to time, the Borrower shall promptly pay to such
\nLender such additional amount or amounts as will compensate such Lender for
\nsuch reduction.<\/p>\n
(c) If any Lender becomes entitled to claim any
\nadditional amounts pursuant to this subsection, it shall promptly notify the
\nBorrower (with a copy to the Agent) of the event by reason of which it has
\nbecome so entitled. A certificate as to any additional amounts payable
\npursuant to this subsection submitted by such Lender to the Borrower (with a
\ncopy to the Agent) shall be conclusive in the absence of manifest error. The
\nagreements in this subsection shall survive the termination of this Agreement
\nand the payment of the Revolving Credit Loans and all other amounts payable
\nhereunder.<\/p>\n
2.16 Taxes. (a) All payments made by the Borrower under
\nthis Agreement and any Notes shall be made free and clear of, and without
\ndeduction or withholding for or on account of, any present or future income,
\nstamp or other taxes, levies, imposts, duties, charges,
\n 25
\n 20<\/p>\n
fees, deductions or withholdings, now or hereafter imposed, levied, collected,
\nwithheld or assessed by any Governmental Authority, excluding net income taxes
\nand franchise taxes (imposed in lieu of net income taxes) imposed on the Agent
\nor any Lender as a result of a present or former connection between the Agent
\nor such Lender and the jurisdiction of the Governmental Authority imposing such
\ntax or any political subdivision or taxing authority thereof or therein (other
\nthan any such connection arising solely from the Agent or such Lender having
\nexecuted, delivered or performed its obligations or received a payment under,
\nor enforced, this Agreement or any Note). If any such non-excluded taxes,
\nlevies, imposts, duties, charges, fees, deductions or withholdings
\n(“Non-Excluded Taxes”) are required to be withheld from any amounts payable to
\nthe Agent or any Lender hereunder or under any Note, the amounts so payable to
\nthe Agent or such Lender shall be increased to the extent necessary to yield to
\nthe Agent or such Lender (after payment of all Non-Excluded Taxes) interest or
\nany such other amounts payable hereunder at the rates or in the amounts
\nspecified in this Agreement; provided, however, that the Borrower shall not be
\nrequired to increase any such amounts payable to any Lender that is not
\norganized under the laws of the United States of America or a state thereof if
\nsuch Lender fails to comply with the requirements of paragraph (b) of this
\nsubsection. Whenever any Non-Excluded Taxes are payable by the Borrower, as
\npromptly as possible thereafter the Borrower shall send to the Agent for its
\nown account or for the account of such Lender, as the case may be, a certified
\ncopy of an original official receipt received by the Borrower showing payment
\nthereof. If the Borrower fails to pay any Non-Excluded Taxes when due to the
\nappropriate taxing authority or fails to remit to the Agent the required
\nreceipts or other required documentary evidence, the Borrower shall indemnify
\nthe Agent and the Lenders for any incremental taxes, interest or penalties that
\nmay become payable by the Agent or any Lender as a result of any such failure.
\nThe agreements in this subsection shall survive the termination of this
\nAgreement and the payment of the Revolving Credit Loans and all other amounts
\npayable hereunder.<\/p>\n
(b) Each Lender that is not incorporated under the laws of
\nthe United States of America or a state thereof shall:<\/p>\n
(i) deliver to the Borrower and the Agent (A) two duly
\n completed copies of United States Internal Revenue Service Form 1001
\n or 4224, or successor applicable form, as the case may be, and (B) an
\n Internal Revenue Service Form W-8 or W-9, or successor applicable
\n form, as the case may be;<\/p>\n
(ii) deliver to the Borrower and the Agent two further copies
\n of any such form or certification on or before the date that any such
\n form or certification expires or becomes obsolete and after the
\n occurrence of any event requiring a change in the most recent form
\n previously delivered by it to the Borrower; and<\/p>\n
(iii) obtain such extensions of time for filing and complete
\n such forms or certifications as may reasonably be requested by the
\n Borrower or the Agent;<\/p>\n
unless in any such case an event (including, without limitation, any change in
\ntreaty, law or regulation) has occurred prior to the date on which any such
\ndelivery would otherwise be required which renders all such forms inapplicable
\nor which would prevent such Lender from duly completing and delivering any such
\nform with respect to it and such Lender so advises the Borrower and the Agent.
\nSuch Lender shall certify (i) in the case of a Form 1001 or 4224, that it is
\nentitled to receive payments under this Agreement without deduction or
\nwithholding of any United States federal income taxes and (ii) in the case of a
\nForm W-8 or W-9, that it is entitled to
\n 26
\n 21<\/p>\n
an exemption from United States backup withholding tax. Each Person that shall
\nbecome a Lender or a Participant pursuant to subsection 9.6 shall, upon the
\neffectiveness of the related transfer, be required to provide all of the forms
\nand statements required pursuant to this subsection; provided that in the case
\nof a Participant such Participant shall furnish all such required forms and
\nstatements to the Lender from which the related participation shall have been
\npurchased.<\/p>\n
2.17 Indemnity. The Borrower agrees to indemnify each Lender
\nand to hold each Lender harmless from any loss or expense which such Lender may
\nsustain or incur as a consequence of (a) default by the Borrower in making a
\nborrowing of, conversion into or continuation of Eurodollar Loans after the
\nBorrower has given a notice requesting the same in accordance with the
\nprovisions of this Agreement, (b) default by the Borrower in making any
\nprepayment after the Borrower has given a notice thereof in accordance with the
\nprovisions of this Agreement or (c) the making of a prepayment of Eurodollar
\nLoans on a day which is not the last day of an Interest Period with respect
\nthereto. Such indemnification may include an amount equal to the excess, if
\nany, of (i) the amount of interest which would have accrued on the amount so
\nprepaid, or not so borrowed, converted or continued, for the period from the
\ndate of such prepayment or of such failure to borrow, convert or continue to
\nthe last day of such Interest Period (or, in the case of a failure to borrow,
\nconvert or continue, the Interest Period that would have commenced on the date
\nof such failure) in each case at the applicable rate of interest for such
\nRevolving Credit Loans provided for herein (excluding, however, the Applicable
\nMargin included therein, if any) over (ii) the amount of interest (as
\nreasonably determined by such Lender) which would have accrued to such Lender
\non such amount by placing such amount on deposit for a comparable period with
\nleading banks in the interbank eurodollar market. This covenant shall survive
\nthe termination of this Agreement and the payment of the Revolving Credit Loans
\nand all other amounts payable hereunder.<\/p>\n
2.18 Change of Lending Office. Each Lender agrees that if it
\nmakes any demand for payment under subsection 2.15 or 2.16(a), or if any
\nadoption or change of the type described in subsection 2.14 shall occur with
\nrespect to it, it will use reasonable efforts (consistent with its internal
\npolicy and legal and regulatory restrictions and so long as such efforts would
\nnot be disadvantageous to it, as determined in its sole discretion) to
\ndesignate a different lending office if the making of such a designation would
\nreduce or obviate the need for the Borrower to make payments under subsection
\n2.15 or 2.16(a), or would eliminate or reduce the effect of any adoption or
\nchange described in subsection 2.14.<\/p>\n
SECTION 3. REPRESENTATIONS AND WARRANTIES<\/p>\n
To induce the Agent and the Lenders to enter into this
\nAgreement and to make the Revolving Credit Loans, the Borrower hereby
\nrepresents and warrants to the Agent and each Lender that:<\/p>\n
3.1 Financial Condition. The consolidated balance sheet of
\nthe Borrower and its consolidated Subsidiaries as at December 31, 1997 and the
\nrelated consolidated statements of income and of cash flows for the fiscal year
\nended on such date, reported on by Arthur Andersen LLP, copies of which have
\nheretofore been furnished to each Lender, are complete and correct and present
\nfairly the consolidated financial condition of the Borrower and its
\nconsolidated Subsidiaries as at such date, and the consolidated results of
\ntheir operations and their consolidated cash flows for the fiscal year then
\nended. All such financial statements, including
\n 27
\n 22<\/p>\n
the related schedules and notes thereto, have been prepared in accordance with
\nGAAP applied consistently throughout the periods involved (except as approved
\nby such accountants or Responsible Officer, as the case may be, and as
\ndisclosed therein). Neither the Borrower nor any of its consolidated
\nSubsidiaries had, at the date of the balance sheet referred to above, any
\nmaterial Guarantee Obligation, contingent liability or liability for taxes, or
\nany long-term lease or unusual forward or long-term commitment, including,
\nwithout limitation, any interest rate or foreign currency swap or exchange
\ntransaction, which is not reflected in the foregoing statements or in the notes
\nthereto. During the period from December 31, 1997 to and including the date
\nhereof there has been no sale, transfer or other disposition by the Borrower or
\nany of its consolidated Subsidiaries of any material part of its business or
\nproperty and no purchase or other acquisition of any business or property
\n(including any capital stock of any other Person) material in relation to the
\nconsolidated financial condition of the Borrower and its consolidated
\nSubsidiaries at December 31, 1997.<\/p>\n
3.2 No Change. (a) Since December 31, 1997 there has been no
\ndevelopment or event which has had or could reasonably be expected to have a
\nMaterial Adverse Effect and (b) during the period from December 31, 1997 to and
\nincluding the date hereof, except for dividends paid on the Convertible
\nPreferred Stock, no dividends or other distributions have been declared, paid
\nor made upon the Capital Stock of the Borrower nor has any of the Capital Stock
\nof the Borrower been redeemed, retired, purchased or otherwise acquired for
\nvalue by the Borrower or any of its Subsidiaries.<\/p>\n
3.3 Corporate Existence; Compliance with Law. Each of the
\nBorrower and its Subsidiaries (a) is duly organized, validly existing and in
\ngood standing under the laws of the jurisdiction of its organization, (b) has
\nthe corporate power and authority, and the legal right, to own and operate its
\nproperty (including, without limitation, the Borrowing Base Assets), to lease
\nthe property it operates as lessee and to conduct the business in which it is
\ncurrently engaged, (c) is duly qualified as a foreign corporation and in good
\nstanding under the laws of each jurisdiction where its ownership, lease or
\noperation of property or the conduct of its business requires such
\nqualification and (d) is in compliance with all Requirements of Law except to
\nthe extent that the failure to comply therewith could not, in the aggregate,
\nreasonably be expected to have a Material Adverse Effect.<\/p>\n
3.4 Corporate Power; Authorization; Enforceable Obligations.
\nThe Borrower has the corporate power and authority, and the legal right, to
\nmake, deliver and perform the Loan Documents to which it is a party and to
\nborrow hereunder and has taken all necessary corporate action to authorize the
\nborrowings on the terms and conditions of this Agreement and any Notes and to
\nauthorize the execution, delivery and performance of the Loan Documents to
\nwhich it is a party. No consent or authorization of, filing with, notice to or
\nother act by or in respect of, any Governmental Authority or any other Person
\nis required in connection with the borrowings hereunder or with the execution,
\ndelivery, performance, validity or enforceability of the Loan Documents to
\nwhich the Borrower is a party. This Agreement has been, and each other Loan
\nDocument to which it is a party will be, duly executed and delivered on behalf
\nof the Borrower. This Agreement constitutes, and each other Loan Document to
\nwhich it is a party when executed and delivered will constitute, a legal, valid
\nand binding obligation of the Borrower enforceable against the Borrower in
\naccordance with its terms, subject to the effects of bankruptcy, insolvency,
\nfraudulent conveyance, reorganization, moratorium and other similar laws
\nrelating to or affecting creditors’ rights generally, general equitable
\nprinciples (whether considered in a proceeding in equity or at law) and an
\nimplied covenant of good faith and fair dealing.
\n 28
\n 23<\/p>\n
3.5 No Legal Bar. The execution, delivery and performance of
\nthe Loan Documents to which the Borrower is a party, the borrowings hereunder
\nand the use of the proceeds thereof will not violate any Requirement of Law or
\nContractual Obligation of the Borrower or of any of its Subsidiaries and will
\nnot result in, or require, the creation or imposition of any Lien on any of its
\nor their respective properties or revenues pursuant to any such Requirement of
\nLaw or Contractual Obligation.<\/p>\n
3.6 No Material Litigation. No litigation, investigation or
\nproceeding of or before any arbitrator or Governmental Authority is pending or,
\nto the knowledge of the Borrower, threatened by or against the Borrower or any
\nof its Subsidiaries or against any of its or their respective properties or
\nrevenues (a) with respect to any of the Loan Documents or any of the
\ntransactions contemplated hereby or thereby, or (b) which could reasonably be
\nexpected to have a Material Adverse Effect.<\/p>\n
3.7 No Default. Neither the Borrower nor any of its
\nSubsidiaries is in default under or with respect to any of its Contractual
\nObligations in any respect which could have a Material Adverse Effect. No
\nDefault or Event of Default has occurred and is continuing.<\/p>\n
3.8 Ownership of Property; Liens. Each of the Borrower and
\nits Subsidiaries has good record and marketable title in fee simple to, or a
\nvalid leasehold interest in, all its real property (including, without
\nlimitation, the Borrowing Base Assets), and good title to, or a valid leasehold
\ninterest in, all its other property, and none of such property is subject to
\nany Lien except as permitted by subsection 6.3.<\/p>\n
3.9 Intellectual Property. The Borrower and each of its
\nSubsidiaries owns, or is licensed to use, all trademarks, tradenames,
\ncopyrights, technology, know-how and processes necessary for the conduct of its
\nbusiness as currently conducted except for those the failure to own or license
\nwhich could not reasonably be expected to have a Material Adverse Effect (the
\n“Intellectual Property”). No claim has been asserted and is pending by any
\nPerson challenging or questioning the use of any such Intellectual Property or
\nthe validity or effectiveness of any such Intellectual Property, nor does the
\nBorrower know of any valid basis for any such claim. The use of such
\nIntellectual Property by the Borrower and its Subsidiaries does not infringe on
\nthe rights of any Person, except for such claims and infringements that, in the
\naggregate, could not reasonably be expected to have a Material Adverse Effect.<\/p>\n
3.10 No Burdensome Restrictions. No Requirement of Law or
\nContractual Obligation of the Borrower or any of its Subsidiaries could
\nreasonably be expected to have a Material Adverse Effect.<\/p>\n
3.11 Taxes. Each of the Borrower and its Subsidiaries has
\nfiled or caused to be filed all tax returns which, to the knowledge of the
\nBorrower, are required to be filed and has paid all taxes shown to be due and
\npayable on said returns or on any assessments made against it or any of its
\nproperty and all other taxes, fees or other charges imposed on it or any of its
\nproperty by any Governmental Authority (other than any the amount or validity
\nof which are currently being contested in good faith by appropriate proceedings
\nand with respect to which reserves in conformity with GAAP have been provided
\non the books of the Borrower or its Subsidiaries, as the case may be); no tax
\nLien has been filed, and, to the knowledge of the Borrower, no claim is being
\nasserted, with respect to any such tax, fee or other charge.
\n 29
\n 24<\/p>\n
3.12 Federal Regulations. No part of the proceeds of any
\nRevolving Credit Loans will be used for “purchasing” or “carrying” any “margin
\nstock” within the respective meanings of each of the quoted terms under
\nRegulation U of the Board of Governors of the Federal Reserve System as now and
\nfrom time to time hereafter in effect. If requested by any Lender or the
\nAgent, the Borrower will furnish to the Agent and each Lender a statement to
\nthe foregoing effect in conformity with the requirements of Regulation U.<\/p>\n
3.13 ERISA. Neither a Reportable Event nor an “accumulated
\nfunding deficiency” (within the meaning of Section 412 of the Code or Section
\n302 of ERISA) has occurred during the five-year period prior to the date on
\nwhich this representation is made or deemed made with respect to any Plan, and
\neach Plan has complied in all material respects with the applicable provisions
\nof ERISA and the Code. No termination of a Single Employer Plan has occurred,
\nand no Lien in favor of the PBGC or a Plan has arisen, during such five-year
\nperiod. The present value of all accrued benefits under each Single Employer
\nPlan (based on those assumptions used to fund such Plans) did not, as of the
\nlast annual valuation date prior to the date on which this representation is
\nmade or deemed made, exceed the value of the assets of such Plan allocable to
\nsuch accrued benefits. Neither the Borrower nor any Commonly Controlled Entity
\nhas had a complete or partial withdrawal from any Multiemployer Plan, and
\nneither the Borrower nor any Commonly Controlled Entity would become subject to
\nany liability under ERISA if the Borrower or any such Commonly Controlled
\nEntity were to withdraw completely from all Multiemployer Plans as of the
\nvaluation date most closely preceding the date on which this representation is
\nmade or deemed made. No such Multiemployer Plan is in Reorganization or
\nInsolvent.<\/p>\n
3.14 Investment Company Act; Public Utility Holding Company
\nAct; Other Regulations. The Borrower is not (a) an “investment company”, or a
\ncompany “controlled” by an “investment company”, within the meaning of the
\nInvestment Company Act of 1940, as amended or (b) a “holding company” as
\ndefined in, or otherwise subject to regulation under, the Public Utility
\nHolding Company Act of 1935. The Borrower is not subject to regulation under
\nany Federal or State statute or regulation (other than Regulation X of the
\nBoard of Governors of the Federal Reserve System) which limits its ability to
\nincur Indebtedness.<\/p>\n
3.15 Purpose of Revolving Credit Loans. The proceeds of the
\nRevolving Credit Loans shall be used by the Borrower to refinance the loans
\noutstanding under the Existing Agreement and for general corporate purposes in
\nthe ordinary course of business.<\/p>\n
3.16 Environmental Matters. Except for environmental matters
\nwhich in the aggregate, could not reasonably be expected to either (a) result
\nin the existence of an unsatisfied liability in excess of a Material
\nEnvironmental Amount or (b) have a Material Adverse Effect:<\/p>\n
(a) To the best of the Borrower’s knowledge, the facilities
\n and properties owned, leased or operated by the Borrower or any of its
\n Subsidiaries (the “Properties”) do not contain, and have not
\n previously contained, any Materials of Environmental Concern in
\n amounts or concentrations which (i) constitute or constituted a
\n violation of, or (ii) could give rise to liability under, any
\n Environmental Law.<\/p>\n
(b) To the best of the Borrower’s knowledge, the Properties
\n and all operations at the Properties are in compliance, and have in
\n the last five years been in compliance, with
\n 30
\n 25<\/p>\n
all applicable Environmental Laws, and there is no contamination at,
\n under or about the Properties or violation of any Environmental Law
\n with respect to the Properties or the business operated by the
\n Borrower or any of its Subsidiaries (the “Business”).<\/p>\n
(c) Neither the Borrower nor any of its Subsidiaries has
\n received any notice of violation, alleged violation, non-compliance,
\n liability or potential liability regarding environmental matters or
\n compliance with Environmental Laws with regard to any of the
\n Properties or the Business, nor does the Borrower have knowledge or
\n reason to believe that any such notice will be received or is being
\n threatened.<\/p>\n
(d) To the best of the Borrower’s knowledge, materials of
\n Environmental Concern have not been transported, or disposed of, from
\n the Properties in violation of, or in a manner or to a location which
\n could reasonably be expected to give rise to liability under, any
\n Environmental Law, nor have any Materials of Environmental Concern
\n been generated, treated, stored or disposed of at, on or under any of
\n the Properties in violation of, or in a manner that could reasonably
\n be expected to give rise to liability under, any applicable
\n Environmental Law.<\/p>\n
(e) No judicial proceeding or governmental or administrative
\n action is pending or, to the knowledge of the Borrower, threatened,
\n under any Environmental Law to which the Borrower or any Subsidiary is
\n or will be named as a party with respect to the Properties or the
\n Business, nor are there any consent decrees or other decrees, consent
\n orders, administrative orders or other orders, or other administrative
\n or judicial requirements outstanding under any Environmental Law with
\n respect to the Properties or the Business.<\/p>\n
(f) To the best of the Borrower’s knowledge, there has been
\n no release or threat of release of Materials of Environmental Concern
\n at or from the Properties, or arising from or related to the
\n operations of the Borrower or any Subsidiary in connection with the
\n Properties or otherwise in connection with the Business, in violation
\n of or in amounts or in a manner that could reasonably be expected to
\n give rise to liability under Environmental Laws.<\/p>\n
3.17 Insurance. The Borrower and each of its Subsidiaries
\nmaintain with financially sound and reputable insurance companies insurance in
\nat least such amounts and against at least such risks (but including in any
\nevent public liability) as are usually insured against in the same general area
\nby companies engaged in the same or a similar business and such insurance is
\notherwise in compliance with the Loan Documents.<\/p>\n
3.18 Subsidiaries. On the Effective Date, the Subsidiaries
\nof the Borrower, and its respective direct or indirect ownership interest in
\neach thereof, shall be as set forth in Schedule 3.18 hereto.<\/p>\n
SECTION 4. CONDITIONS PRECEDENT<\/p>\n
4.1 Conditions to Effectiveness. This Agreement shall become
\neffective upon, and the agreement of each Lender to make the initial Revolving
\nCredit Loan requested to be made by it is subject to, the satisfaction no later
\nthan May 15, 1998 of the following conditions precedent:
\n 31
\n 26<\/p>\n
(a) Loan Documents. The Agent shall have received (i) this
\n Agreement, executed and delivered by a duly authorized officer of the
\n Borrower, with a counterpart for each Lender, (ii) the Subsidiaries
\n Guarantee, executed and delivered by a duly authorized officer of each
\n Subsidiary Guarantor, with a counterpart for each Lender, and (iii)
\n for the account of each Lender, a Revolving Credit Note in form and
\n substance reasonably acceptable to the Agent and the Agent’s counsel
\n executed and delivered by a duly authorized officer of the Borrower.<\/p>\n
(b) Effective Certificate. The Agent shall have received,
\n with a counterpart for each Lender, a certificate of the Borrower and
\n each Subsidiary Guarantor, dated the Effective Date, substantially in
\n the form of Exhibit C, with appropriate insertions and attachments,
\n satisfactory in form and substance to the Agent, executed by the
\n Chairman of the Board of Directors, President, any Vice President or
\n the Secretary or any Assistant Secretary of the Borrower and each
\n Subsidiary Guarantor.<\/p>\n
(c) Corporate Proceedings. The Agent shall have received,
\n with a counterpart for each Lender, a copy of the resolutions, in form
\n and substance satisfactory to the Agent, of the Board of Directors of
\n the Borrower and each Subsidiary Guarantor authorizing (i) the
\n execution, delivery and performance of the Loan Documents to which it
\n is a party and (ii) in the case of the Borrower, the borrowings
\n contemplated hereunder, certified by the Secretary or an Assistant
\n Secretary of the Borrower and of each such Subsidiary Guarantor, as
\n the case may be, as of the Effective Date, which certificate shall be
\n in form and substance satisfactory to the Agent and the Agent’s
\n counsel and shall state that the resolutions thereby certified have
\n not been amended, modified, revoked or rescinded.<\/p>\n
(d) Incumbency Certificates. The Agent shall have received,
\n with a counterpart for each Lender, a Certificate of the Borrower and
\n each Subsidiary Guarantor, dated the Effective Date, as to the
\n incumbency and signature of the officers of the Borrower and the
\n Subsidiary Guarantors executing any Loan Document satisfactory in form
\n and substance to the Agent, executed by the Chairman of the Board of
\n Directors, President or any Vice President and the Secretary or any
\n Assistant Secretary of the Borrower and each Subsidiary Guarantor.<\/p>\n
(e) Corporate Documents. The Agent shall have received, with
\n a counterpart for each Lender, true and complete copies of the
\n certificate of incorporation and by-laws of the Borrower certified as
\n of the Effective Date as complete and correct copies thereof by the
\n Secretary or an Assistant Secretary of the Borrower.<\/p>\n
(f) Fees. The Agent shall have received any fees and
\n expenses required to be received by it on the Effective Date pursuant
\n to the Loan Documents and the Fee Letter.<\/p>\n
(g) Legal Opinion. The Agent shall have received, with a
\n counterpart for each Lender, the executed legal opinion of Lynch,
\n Chappell & Alsup, a professional corporation, counsel to the Borrower
\n and each Subsidiary Guarantor, substantially in the form of Exhibit D;
\n such legal opinion shall cover such other matters incident to the
\n transactions contemplated by this Agreement as the Agent and the
\n Agent’s counsel may reasonably require.
\n 32
\n 27<\/p>\n
(h) Reserve Report. Notwithstanding the provisions of
\n subsection 2.6(b), the Agent and the Co-Agent shall have received,
\n with a counterpart for each Lender, a Reserve Report with respect to
\n the Borrower and its Subsidiaries dated as of December 31, 1997
\n complying in all other respects with the provisions of subsection
\n 2.6(b) and such other reserve information as may be requested by the
\n Agent and the Co-Agent, all of which shall be satisfactory in form and
\n substance to the Agent and the Co-Agent.<\/p>\n
(i) Existing Agreement. All amounts owed with respect to the
\n Existing Agreement shall have been paid in full and the Existing
\n Agreement and all commitments thereunder shall have been terminated.<\/p>\n
4.2 Conditions to Each Revolving Credit Loan. The agreement
\nof each Lender to make any Revolving Credit Loan requested to be made by it on
\nany date (including, without limitation, its initial Revolving Credit Loan) is
\nsubject to the satisfaction of the following conditions precedent:<\/p>\n
(a) Representations and Warranties. Each of the
\n representations and warranties made by the Borrower and the Subsidiary
\n Guarantors in or pursuant to the Loan Documents shall be true and
\n correct in all material respects on and as of such date as if made on
\n and as of such date.<\/p>\n
(b) No Default. No Default or Event of Default shall have
\n occurred and be continuing on such date or after giving effect to the
\n Revolving Credit Loans requested to be made on such date.<\/p>\n
(c) Maintenance of Borrowing Base. Notwithstanding
\n subsection 2.7(b), after giving effect to the Revolving Credit Loans
\n requested to be made on any date, the aggregate amount of the
\n Revolving Credit Loans then outstanding shall not exceed the Borrowing
\n Base then in effect.<\/p>\n
(d) No Material Litigation. No litigation, investigation or
\n proceeding of or before any arbitrator or Governmental Authority shall
\n be pending or, to the knowledge of the Borrower, threatened by or
\n against the Borrower or any of its Subsidiaries or against any of its
\n or their respective properties or revenues (a) with respect to any of
\n the Loan Documents or any of the transactions contemplated hereby or
\n thereby, or (b) which could reasonably be expected to have a Material
\n Adverse Effect.<\/p>\n
(e) Borrowing Base Certificate. The Agent shall have
\n received, with a counterpart for each Lender, a Borrowing Base
\n certificate substantially in the form of Exhibit E, with appropriate
\n insertions.<\/p>\n
(f) Additional Matters. All corporate and other proceedings,
\n and all documents, instruments and other legal matters in connection
\n with the transactions contemplated by this Agreement and the other
\n Loan Documents shall be satisfactory in form and substance to the
\n Agent, and the Agent shall have received such other documents and
\n legal opinions in respect of any aspect or consequence of the
\n transactions contemplated hereby or thereby as it shall reasonably
\n request.<\/p>\n
Each borrowing by the Borrower hereunder shall constitute a representation and
\nwarranty by the
\n 33
\n 28<\/p>\n
Borrower as of the date thereof that the conditions contained in this subsection
\nhave been satisfied.<\/p>\n
SECTION 5. AFFIRMATIVE COVENANTS<\/p>\n
The Borrower hereby agrees that, so long as the Commitments
\nremain in effect or any amount is owing to any Lender or the Agent hereunder or
\nunder any other Loan Document, the Borrower shall and (except in the case of
\ndelivery of financial information, reports and notices) shall cause each of its
\nSubsidiaries to:<\/p>\n
5.1 Financial Statements. Furnish to each Lender:<\/p>\n
(a) as soon as available, but in any event within 90 days
\n after the end of each fiscal year of the Borrower, a copy of the
\n consolidated balance sheet of the Borrower and its consolidated
\n Subsidiaries as at the end of such year and the related consolidated
\n statements of income and retained earnings and of cash flows for such
\n year, setting forth in each case in comparative form the figures for
\n the previous year, reported on without a “going concern” or like
\n qualification or exception, or qualification arising out of the scope
\n of the audit, by Arthur Andersen LLP or other independent certified
\n public accountants of nationally recognized standing; and<\/p>\n
(b) as soon as available, but in any event not later than 45
\n days after the end of each of the first three quarterly periods of
\n each fiscal year of the Borrower, the unaudited consolidated balance
\n sheet of the Borrower and its consolidated Subsidiaries as at the end
\n of such quarter and the related unaudited consolidated statements of
\n income and retained earnings and of cash flows of the Borrower and its
\n consolidated Subsidiaries for such quarter and the portion of the
\n fiscal year through the end of such quarter, setting forth in each
\n case in comparative form the figures for the previous year, certified
\n by a Responsible Officer as being fairly stated in all material
\n respects (subject to normal year-end audit adjustments);<\/p>\n
all such financial statements shall be complete and correct in all material
\nrespects and shall be prepared in reasonable detail and in accordance with GAAP
\napplied consistently throughout the periods reflected therein and with prior
\nperiods (except as approved by such accountants or officer, as the case may be,
\nand disclosed therein).<\/p>\n
5.2 Certificates; Other Information. Furnish to each Lender:<\/p>\n
(a) concurrently with the delivery of the financial
\n statements referred to in subsection 5.1(a), a certificate of the
\n independent certified public accountants reporting on such financial
\n statements stating that in making the examination necessary therefor
\n no knowledge was obtained of any Default or Event of Default, except
\n as specified in such certificate;<\/p>\n
(b) concurrently with the delivery of the financial
\n statements referred to in subsections 5.1(a) and (b), a certificate of
\n a Responsible Officer stating that, to the best of such officer’s
\n knowledge, the Borrower during such period has observed or performed
\n all of its covenants and other agreements, and satisfied every
\n condition, contained in this Agreement and the other Loan Documents to
\n be observed, performed or satisfied by it,
\n 34
\n 29<\/p>\n
and that such officer has obtained no knowledge of any Default or
\n Event of Default except as specified in such certificate, which
\n certificate shall include the detailed calculations of such
\n Responsible Officer demonstrating the Borrower’s compliance with the
\n financial covenants set forth in subsection 6.1;<\/p>\n
(c) not later than sixty days after the end of each fiscal
\n year of the Borrower, a copy of the projections by the Borrower of the
\n operating budget and cash flow budget (including capital expenditures)
\n of the Borrower and its consolidated Subsidiaries for the succeeding
\n fiscal year, such projections to be accompanied by a certificate of a
\n Responsible Officer to the effect that such projections have been
\n prepared on the basis of sound financial planning practice and that
\n such Officer has no reason to believe they are incorrect or misleading
\n in any material respect;<\/p>\n
(d) within five Business Days after the same are sent, copies
\n of all financial statements and reports which the Borrower sends to
\n its stockholders, and within five days after the same are filed,
\n copies of all financial statements and reports which the Borrower may
\n make to, or file with, the Securities and Exchange Commission or any
\n successor or analogous Governmental Authority;<\/p>\n
(e) promptly, such additional financial and other information
\n as any Lender may from time to time reasonably request.<\/p>\n
5.3 Payment of Obligations. Pay, discharge or otherwise
\nsatisfy at or before maturity or before they become delinquent, as the case may
\nbe, all its obligations of whatever nature, except where the amount or validity
\nthereof is currently being contested in good faith by appropriate proceedings
\nand reserves in conformity with GAAP with respect thereto have been provided on
\nthe books of the Borrower or its Subsidiaries, as the case may be.<\/p>\n
5.4 Conduct of Business and Maintenance of Existence.
\nContinue to engage in business of the same general type as now conducted by it
\nand preserve, renew and keep in full force and effect its corporate existence
\nand take all reasonable action to maintain all rights, privileges and
\nfranchises necessary or desirable in the normal conduct of its business except
\nas otherwise permitted pursuant to subsection 6.5; comply with all Contractual
\nObligations and Requirements of Law except to the extent that failure to comply
\ntherewith could not, in the aggregate, be reasonably expected to have a
\nMaterial Adverse Effect.<\/p>\n
5.5 Maintenance of Property; Insurance. Keep all property
\nuseful and necessary in its business in good working order and condition;
\nmaintain with financially sound and reputable insurance companies insurance in
\nat least such amounts and against at least such risks (but including in any
\nevent public liability) as are usually insured against in the same general area
\nby companies engaged in the same or a similar business; and furnish to each
\nLender, upon written request, full information as to the insurance carried.<\/p>\n
5.6 Inspection of Property; Books and Records; Discussions.
\nKeep proper books of records and accounts in which full, true and correct
\nentries in conformity with GAAP and all Requirements of Law shall be made of
\nall dealings and transactions in relation to its business and activities; and
\npermit representatives of any Lender to visit and inspect any of its properties
\nand examine and make abstracts from any of its books and records at any
\nreasonable time and as often as may reasonably be desired and to discuss the
\nbusiness, operations, properties (including,
\n 35
\n 30<\/p>\n
without limitation, the Borrowing Base Assets) and financial and other
\ncondition of the Borrower and its Subsidiaries with officers and employees of
\nthe Borrower and its Subsidiaries and with its independent certified public
\naccountants.<\/p>\n
5.7 Notices. Promptly give notice to the Agent and each
\nLender of:<\/p>\n
(a) the occurrence of any Default or Event of Default;<\/p>\n
(b) any (i) default or event of default under any Contractual
\n Obligation of the Borrower or any of its Subsidiaries or (ii)
\n litigation, investigation or proceeding which may exist at any time
\n between the Borrower or any of its Subsidiaries and any Governmental
\n Authority, which in either case, if not cured or if adversely
\n determined, as the case may be, could reasonably be expected to have a
\n Material Adverse Effect;<\/p>\n
(c) any litigation or proceeding affecting the Borrower or
\n any of its Subsidiaries in which the amount involved is $3,000,000
\n (individually or when aggregated with any other such litigation or
\n proceeding) or more and not covered by insurance or in which
\n injunctive or similar relief is sought;<\/p>\n
(d) the following events, as soon as possible and in any
\n event within 30 days after the Borrower knows or has reason to know
\n thereof: (i) the occurrence or expected occurrence of any Reportable
\n Event with respect to any Plan, a failure to make any required
\n contribution to a Plan, the creation of any Lien in favor of the PBGC
\n or a Plan or any withdrawal from, or the termination, Reorganization
\n or Insolvency of, any Multiemployer Plan or (ii) the institution of
\n proceedings or the taking of any other action by the PBGC or the
\n Borrower or any Commonly Controlled Entity or any Multiemployer Plan
\n with respect to the withdrawal from, or the terminating,
\n Reorganization or Insolvency of, any Plan; and<\/p>\n
(e) any development or event which could reasonably be
\n expected to have a Material Adverse Effect.<\/p>\n
Each notice pursuant to this subsection shall be accompanied by a statement of
\na Responsible Officer setting forth details of the occurrence referred to
\ntherein and stating what action the Borrower proposes to take with respect
\nthereto.<\/p>\n
5.8 Environmental Laws. (a) Except as, in the aggregate,
\ncould not reasonably be expected to either (i) result in the payment of a
\nMaterial Environmental Amount or (ii) have a Material Adverse Effect, (x)
\ncomply with, and ensure compliance by all tenants and subtenants, if any, with,
\nall applicable Environmental Laws and obtain and comply with and maintain, and
\nensure that all tenants and subtenants obtain and comply with and maintain, and
\nensure that any and all licenses, approvals, notifications, registrations or
\npermits required by applicable Environmental Laws are maintained and complied
\nwith and (y) conduct and complete all investigations, studies, sampling and
\ntesting, and all remedial, removal and other actions required under
\nEnvironmental Laws and promptly comply with all lawful orders and directives of
\nall Governmental Authorities.<\/p>\n
(b) Defend, indemnify and hold harmless the Agent and the
\nLenders, and their respective parents, subsidiaries, affiliates, employees,
\nagents, officers and directors, from and
\n 36
\n 31<\/p>\n
against any and all claims, demands, penalties, fines, liabilities,
\nsettlements, damages, costs and expenses of whatever kind or nature known or
\nunknown, contingent or otherwise, arising out of, or in any way relating to,
\nthe violation of, noncompliance with or liability under any Environmental Laws
\napplicable to the operations of the Borrower or any of its Subsidiaries or to
\nthe Borrowing Base Assets, or any orders, requirements or demands of
\nGovernmental Authorities related thereto, including, without limitation,
\nattorneys’ and consultants’ fees, investigation and laboratory fees, response
\ncosts, court costs and litigation expenses, except to the extent that any of
\nthe foregoing are found by a final and nonappealable decision of a court of
\ncompetent jurisdiction to have resulted from the gross negligence or willful
\nmisconduct of the party seeking indemnification therefor. This indemnity shall
\ncontinue in full force and effect regardless of the termination of this
\nAgreement.<\/p>\n
5.9 Borrowing Base Certificates. Provide the Agent with a
\nBorrowing Base certificate substantially in the form of Exhibit E, with
\nappropriate insertions, (i) concurrently with the provision of a notice of
\nborrowing under the Commitments pursuant to subsection 2.2, (ii) concurrently
\nwith the provision of a notice of prepayment of the Revolving Credit Loans by
\nthe Borrower to the Agent pursuant to subsection 2.7(a), (iii) concurrently
\nwith a prepayment of the Revolving Credit Loans pursuant to subsection 2.7(c)
\nand (iv) not later than 3 Business Days following a redetermination of the
\nBorrowing Base pursuant to subsection 2.6(b).<\/p>\n
SECTION 6. NEGATIVE COVENANTS<\/p>\n
The Borrower hereby agrees that, so long as the Commitments
\nremain in effect or any amount is owing to any Lender or the Agent hereunder or
\nunder any other Loan Document, the Borrower shall not, and shall not permit any
\nof its Subsidiaries to, directly or indirectly:<\/p>\n
6.1 Financial Condition Covenants.<\/p>\n
(a) Maintenance of Consolidated Tangible Net Worth. Permit
\n Consolidated Tangible Net Worth to be less than the sum, without
\n duplication, of (i) $350,000,000, (ii) 50% of the Consolidated Net
\n Income for each fiscal quarter of the Borrower ending after December
\n 31, 1997 (so long as Consolidated Net Income is positive for the
\n relevant period) and (iii) 50% of the Net Cash Proceeds of any primary
\n offering (public or private) of equity securities consummated by the
\n Borrower after the Effective Date.<\/p>\n
(b) Fixed Charge Coverage. Permit for any period of four
\n consecutive fiscal quarters (each such period a “Test Period”) of the
\n Borrower the ratio of (i) Consolidated EBITDA for such Test Period to
\n (ii) Consolidated Fixed Charges for such Test Period to be less than
\n 2.5 to 1.0.<\/p>\n
(c) Leverage. Permit the ratio of Consolidated Debt to
\n Consolidated Total Capitalization any time to be greater than 0.45 to
\n 1.0.<\/p>\n
6.2 Limitation on Indebtedness. Create, incur, assume or
\n suffer to exist any Indebtedness, except:<\/p>\n
(a) Indebtedness of the Borrower under this Agreement;<\/p>\n
(b) Indebtedness of the Borrower to any Subsidiary and of any
\n Subsidiary
\n 37
\n 32<\/p>\n
Guarantor to the Borrower or any other Subsidiary Guarantor;<\/p>\n
(c) Indebtedness permitted under subsection 6.3;<\/p>\n
(d) Guarantee Obligations permitted under subsection 6.4;<\/p>\n
(e) additional Indebtedness of the Borrower and Retex not
\n exceeding $1,500,000 in aggregate principal amount at any one time
\n outstanding;<\/p>\n
(f) Indebtedness of the Partnership not exceeding $2,000,000
\n in aggregate principal amount at any one time outstanding;<\/p>\n
(g) additional Indebtedness of the Partnership so long as
\n such Indebtedness is non-recourse in all respects to the Borrower and
\n its other Subsidiaries; and<\/p>\n
(h) letters of credit issued in the ordinary course of
\n business for the account of the Borrower and its Subsidiaries in an
\n aggregate face amount not exceeding $6,000,000 at any time.<\/p>\n
6.3 Limitation on Liens. Create, incur, assume or suffer to
\nexist any Lien upon any of its property, assets or revenues, whether now owned
\nor hereafter acquired, except for:<\/p>\n
(a) Liens for taxes not yet due or which are being contested
\n in good faith by appropriate proceedings; provided that adequate
\n reserves with respect thereto are maintained on the books of the
\n Borrower or its Subsidiaries, as the case may be, in conformity with
\n GAAP;<\/p>\n
(b) carriers’, warehousemen’s, mechanics’, materialmen’s,
\n repairmen’s, operator’s or other like Liens arising in the ordinary
\n course of business which are not overdue for a period of more than 60
\n days or which are being contested in good faith by appropriate
\n proceedings;<\/p>\n
(c) pledges or deposits in connection with workers’
\n compensation, unemployment insurance and other social security
\n legislation and deposits securing liability to insurance carriers
\n under insurance or self-insurance arrangements;<\/p>\n
(d) deposits to secure the performance of bids, trade
\n contracts (other than for borrowed money), leases, statutory
\n obligations, surety and appeal bonds, performance bonds and other
\n obligations of a like nature incurred in the ordinary course of
\n business;<\/p>\n
(e) easements, rights-of-way, restrictions, title defects and
\n other similar encumbrances incurred in the ordinary course of business
\n which, in the aggregate, are not substantial in amount and which do
\n not in any case materially detract from the value of the property
\n subject thereto or materially interfere with the ordinary conduct of
\n the business of the Borrower or such Subsidiary; and<\/p>\n
(f) Liens on properties of the Partnership securing
\n Indebtedness permitted by subsections 6.2(f) and 6.2(g); provided that
\n the amount of the Borrowing Base shall be reduced by the amount of any
\n such Indebtedness secured by such Liens.
\n 38
\n 33<\/p>\n
6.4 Limitation on Guarantee Obligations. Create, incur,
\nassume or suffer to exist any Guarantee Obligation except:<\/p>\n
(a) Guarantee Obligations in the nature of performance bonds
\n in the ordinary course of business and not in the nature of
\n Indebtedness;<\/p>\n
(b) Guarantee Obligations in an aggregate amount not to
\n exceed $5,000,000 at any one time outstanding; and<\/p>\n
(c) the Subsidiaries Guarantee.<\/p>\n
6.5 Limitation on Fundamental Changes. Enter into any
\nmerger, consolidation or amalgamation, or liquidate, wind up or dissolve itself
\n(or suffer any liquidation or dissolution), or convey, sell, lease, assign,
\ntransfer or otherwise dispose of, all or substantially all of its property,
\nbusiness or assets, or make any material change in its present method of
\nconducting business, except:<\/p>\n
(a) any Subsidiary of the Borrower may be merged or
\nconsolidated with or into the Borrower (provided that the Borrower shall be the
\ncontinuing or surviving corporation) or with or into any one or more wholly
\nowned Subsidiaries of the Borrower (provided that the wholly owned Subsidiary
\nor Subsidiaries shall be the continuing or surviving corporation); and<\/p>\n
(b) any wholly owned Subsidiary may sell, lease, transfer or
\notherwise dispose of any or all of its assets (upon voluntary liquidation or
\notherwise) to the Borrower or any other wholly owned Subsidiary of the
\nBorrower.<\/p>\n
6.6 Limitation on Sale of Assets. Convey, sell, lease,
\nassign, transfer or otherwise dispose of any of its property, business or
\nassets (including, without limitation, receivables and leasehold interests),
\nwhether now owned or hereafter acquired, or, in the case of any Subsidiary,
\nissue or sell any shares of such Subsidiary’s Capital Stock to any Person other
\nthan the Borrower or any wholly owned Subsidiary, except:<\/p>\n
(a) obsolete, worn out, depleted or “uneconomic” property
\n disposed of in the ordinary course of business;<\/p>\n
(b) the sale, transportation and marketing of Petroleum in
\n the ordinary course of business;<\/p>\n
(c) as permitted by subsection 6.5(b);<\/p>\n
(d) undeveloped, undrilled leasehold acreage held in the
\n Borrower’s inventory; provided that in any fiscal year of the Borrower
\n the gross proceeds of such property so disposed of shall not exceed
\n $5,000,000; and<\/p>\n
(e) the sale of producing properties of the Borrower and its
\n Subsidiaries; provided that in any fiscal year of the Borrower the
\n gross proceeds of such sale or sales shall not in the aggregate exceed
\n $10,000,000.
\n 39
\n 34<\/p>\n
6.7 Limitation on Dividends. Declare or pay any dividend
\n(other than dividends payable solely in common stock of the Borrower) on, or
\nmake any payment on account of, or set apart assets for a sinking or other
\nanalogous fund for, the purchase, redemption, defeasance, retirement or other
\nacquisition of, any shares of any class of Capital Stock of the Borrower or any
\nwarrants or options to purchase any such Stock, whether now or hereafter
\noutstanding, or make any other distribution in respect thereof, either directly
\nor indirectly, whether in cash or property or in obligations of the Borrower or
\nany Subsidiary except that, so long as no Default or Event of Default is in
\nexistence, the Borrower may pay dividends on the Convertible Preferred Stock.<\/p>\n
6.8 Limitation on Investments, Acquisitions, Loans and
\nAdvances. Make any advance, loan, extension of credit or capital contribution
\nto, or purchase any stock, bonds, notes, debentures or other securities of or
\nany assets constituting a business unit of, or make any other investment in,
\nany Person, except:<\/p>\n
(a) extensions of trade credit in the ordinary course of
\n business;<\/p>\n
(b) investments in Cash Equivalents;<\/p>\n
(c) loans and advances to employees of the Borrower or its
\n Subsidiaries for travel, entertainment and relocation expenses in the
\n ordinary course of business;<\/p>\n
(d) investments made in the ordinary course of business in
\n the Partnership, the Wind River Joint Venture and Wildhorse, and
\n working capital contributions to Wildhorse; provided that such
\n investments and working capital contributions (including those
\n investments and working capital contributions made prior to the
\n effectiveness of this Agreement) do not exceed $65,000,000 in the
\n aggregate; and<\/p>\n
(e) Indebtedness permitted under subsection 6.2(b).<\/p>\n
6.9 Limitation on Transactions with Affiliates. Enter into
\nany transaction, including, without limitation, any purchase, sale, lease or
\nexchange of property or the rendering of any service, with any Affiliate unless
\nsuch transaction is (a) not otherwise prohibited under this Agreement, (b) in
\nthe ordinary course of the Borrower’s or such Subsidiary’s business and (c)
\nupon fair and reasonable terms no less favorable to the Borrower or such
\nSubsidiary, as the case may be, than it would obtain in a comparable arm’s
\nlength transaction with a Person which is not an Affiliate.<\/p>\n
6.10 Limitation on Sales and Leasebacks. Enter into any
\narrangement with any Person providing for the leasing by the Borrower or any
\nSubsidiary of real or personal property which has been or is to be sold or
\ntransferred by the Borrower or such Subsidiary to such Person or to any other
\nPerson to whom funds have been or are to be advanced by such Person on the
\nsecurity of such property or rental obligations of the Borrower or such
\nSubsidiary.<\/p>\n
6.11 Limitation on Operating Leases. Enter into operating
\nleases with any Person, except:<\/p>\n
(a) operating leases with rental obligations in an aggregate
\n principal amount not exceeding $5,000,000 in any fiscal year; and
\n 40
\n 35<\/p>\n
(b) oil and gas leases and oil and gas operating agreements
\n entered into in the ordinary course of business.<\/p>\n
6.12 Limitation on Changes in Fiscal Year. Permit the fiscal
\nyear of the Borrower to end on a day other than December 31.<\/p>\n
6.13 Limitation on Negative Pledge Clauses. Enter into with
\nany Person any agreement, other than (a) this Agreement, (b) the Loan
\nDocuments, (c) the Wind River Joint Venture Agreement, (d) the Wildhorse
\nLimited Liability Company Agreement, and (e) any industrial revenue bonds,
\npurchase money mortgages or Financing Leases permitted by this Agreement (in
\nwhich cases, any prohibition or limitation shall only be effective against the
\nassets financed thereby), which prohibits or limits the ability of the Borrower
\nor any of its Subsidiaries to create, incur, assume or suffer to exist any Lien
\nupon any of its property, assets or revenues, whether now owned or hereafter
\nacquired.<\/p>\n
6.14 Limitation on Lines of Business. Enter into any
\nbusiness, either directly or through any Subsidiary, except for those
\nbusinesses in which the Borrower and its Subsidiaries are engaged on the date
\nof this Agreement or which are directly related thereto.<\/p>\n
6.15 Limitation on Certain Agreements. Enter into any
\nPetroleum Price Hedge Agreement or Interest Rate Protection Agreement except
\nwhere such agreements are entered into in the ordinary course of business (and
\nnot for speculative purposes) and designed to protect the Borrower or any of
\nits Subsidiaries against fluctuations in Petroleum prices and interest rates;
\nprovided, that with respect to Petroleum Price Hedge Agreements that the
\naggregate amount of volumes of Petroleum subject to such Petroleum Price Hedge
\nAgreements shall not exceed 75% of the anticipated production from the
\nBorrower’s and its Subsidiaries’ proved, developed Petroleum reserves for the
\nperiod covered by such Petroleum Hedge Agreements and provided, further, that
\nin the event that the Borrower enters into a Petroleum Price Hedge Agreement or
\nInterest Rate Protection Agreement with a Lender, or an Affiliate thereof, the
\nnet liabilities of the Borrower under such Petroleum Price Hedge Agreement or
\nInterest Rate Protection Agreement will rank pari passu with the Borrower’s
\nIndebtedness under this Agreement.<\/p>\n
SECTION 7. EVENTS OF DEFAULT<\/p>\n
If any of the following events shall occur and be continuing:<\/p>\n
(a) The Borrower shall fail to pay any principal of any
\n Revolving Credit Loan when due in accordance with the terms thereof or
\n hereof; or the Borrower shall fail to pay any interest on any
\n Revolving Credit Loan, or any other amount payable hereunder, within
\n five days after any such interest or other amount becomes due in
\n accordance with the terms thereof or hereof; or<\/p>\n
(b) Any representation or warranty made or deemed made by the
\n Borrower or any of its Subsidiaries herein or in any other Loan
\n Document or which is contained in any certificate, document or
\n financial or other statement furnished by it at any time under or in
\n connection with this Agreement or any such other Loan Document shall
\n prove to have been incorrect in any material respect on or as of the
\n date made or deemed made; or<\/p>\n
(c) The Borrower shall default in the observance or
\n performance of any agreement contained in Section 6; or
\n 41
\n 36<\/p>\n
(d) The Borrower or any of its Subsidiaries shall default in
\n the observance or performance of any other agreement contained in this
\n Agreement or any other Loan Document (other than as provided in
\n paragraphs (a) through (c) of this Section), and such default shall
\n continue unremedied for a period of 30 days; or<\/p>\n
(e) The Borrower or any of its Subsidiaries shall (i) default
\n in any payment of principal of or interest of any Indebtedness (other
\n than the Revolving Credit Loans) or in the payment of any Guarantee
\n Obligation, beyond the period of grace (not to exceed 30 days), if
\n any, provided in the instrument or agreement under which such
\n Indebtedness or Guarantee Obligation was created, if the aggregate
\n amount of the Indebtedness and\/or Guarantee Obligations in respect of
\n which such default or defaults shall have occurred is at least
\n $1,000,000; or (ii) default in the observance or performance of any
\n other agreement or condition relating to any such Indebtedness or
\n Guarantee Obligation or contained in any instrument or agreement
\n evidencing, securing or relating thereto, or any other event shall
\n occur or condition exist, the effect of which default or other event
\n or condition is to cause, or to permit the holder or holders of such
\n Indebtedness or beneficiary or beneficiaries of such Guarantee
\n Obligation (or a trustee or agent on behalf of such holder or holders
\n or beneficiary or beneficiaries) to cause, with the giving of notice
\n if required, such Indebtedness to become due prior to its stated
\n maturity or such Guarantee Obligation to become payable; or<\/p>\n
(f) (i) The Borrower or any of its Subsidiaries shall
\n commence any case, proceeding or other action (A) under any existing
\n or future law of any jurisdiction, domestic or foreign, relating to
\n bankruptcy, insolvency, reorganization or relief of debtors, seeking
\n to have an order for relief entered with respect to it, or seeking to
\n adjudicate it a bankrupt or insolvent, or seeking reorganization,
\n arrangement, adjustment, winding-up, liquidation, dissolution,
\n composition or other relief with respect to it or its debts, or (B)
\n seeking appointment of a receiver, trustee, custodian, conservator or
\n other similar official for it or for all or any substantial part of
\n its assets, or the Borrower or any of its Subsidiaries shall make a
\n general assignment for the benefit of its creditors; or (ii) there
\n shall be commenced against the Borrower or any of its Subsidiaries any
\n case, proceeding or other action of a nature referred to in clause (i)
\n above which (A) results in the entry of an order for relief or any
\n such adjudication or appointment or (B) remains undismissed,
\n undischarged or unbonded for a period of 60 days; or (iii) there shall
\n be commenced against the Borrower or any of its Subsidiaries any case,
\n proceeding or other action seeking issuance of a warrant of
\n attachment, execution, distraint or similar process against all or any
\n substantial part of its assets which results in the entry of an order
\n for any such relief which shall not have been vacated, discharged, or
\n stayed or bonded pending appeal within 60 days from the entry thereof;
\n or (iv) the Borrower or any of its Subsidiaries shall take any action
\n in furtherance of, or indicating its consent to, approval of, or
\n acquiescence in, any of the acts set forth in clause (i), (ii), or
\n (iii) above; or (v) the Borrower or any of its Subsidiaries shall
\n generally not, or shall be unable to, or shall admit in writing its
\n inability to, pay its debts as they become due; or<\/p>\n
(g) (i) Any Person shall engage in any “prohibited
\n transaction” (as defined in Section 406 of ERISA or Section 4975 of
\n the Code) involving any Plan, (ii) any “accumulated funding
\n deficiency” (as defined in Section 302 of ERISA), whether or not
\n 42
\n 37<\/p>\n
waived, shall exist with respect to any Plan, or any Lien in favor of
\n the PBGC or a Plan shall arise on the assets of the Borrower or any
\n Commonly Controlled Entity, (iii) a Reportable Event shall occur with
\n respect to, or proceedings shall commence to have a trustee appointed,
\n or a trustee shall be appointed, to administer or to terminate, any
\n Single Employer Plan, which Reportable Event or commencement of
\n proceedings or appointment of a trustee is, in the reasonable opinion
\n of the Required Lenders, likely to result in the termination of such
\n Plan for purposes of Title IV of ERISA, (iv) any Single Employer Plan
\n shall terminate for purposes of Title IV of ERISA, (v) the Borrower or
\n any Commonly Controlled Entity shall, or in the reasonable opinion of
\n the Required Lenders is likely to, incur any liability in connection
\n with a withdrawal from, or the Insolvency or Reorganization of, a
\n Multiemployer Plan or (vi) any other event or condition shall occur or
\n exist with respect to a Plan; and in each case in clauses (i) through
\n (vi) above, such event or condition, together with all other such
\n events or conditions, if any, could reasonably be expected to have a
\n Material Adverse Effect; or<\/p>\n
(h) One or more judgments or decrees shall be entered against
\n the Borrower or any of its Subsidiaries involving in the aggregate a
\n liability (not paid or fully covered by insurance) of $5,000,000 or
\n more, and all such judgments or decrees shall not have been vacated,
\n discharged, stayed or bonded pending appeal within 60 days from the
\n entry thereof; or<\/p>\n
(i) Any of the Loan Documents shall cease, for any reason, to
\n be in full force and effect, or the Borrower shall so assert; or<\/p>\n
(j) (i) Any Person or “group” (within the meaning of Section
\n 13(d) or 14(d) of the Securities Exchange Act of 1934, as amended) (A)
\n shall have acquired beneficial ownership of 20% or more of any
\n outstanding class of Capital Stock having ordinary voting power in the
\n election of directors of the Borrower, (B) (i) shall obtain the power
\n (whether or not exercised) to elect a majority of the Borrower’s
\n directors or (ii) the Board of Directors of the Borrower shall not
\n consist of a majority of Continuing Directors; “Continuing Directors”
\n shall mean the directors of the Borrower on the Effective Date and
\n each other director, if such other director’s nomination for election
\n to the Board of Directors of the Borrower is recommended by a majority
\n of the then Continuing Directors; or (ii) the Borrower shall cease to
\n own 100% of the issued and outstanding Capital Stock of each of its
\n Subsidiaries, or, in the case of the Partnership, shall cease to be
\n the general partner; or<\/p>\n
(k) Environmental liabilities aggregating in excess of a
\n Material Environmental Amount shall be (i) outstanding at any time
\n with respect to the Borrower or any of its Subsidiaries or (ii) paid
\n in any fiscal year of the Borrower by the Borrower or any of its
\n Subsidiaries,<\/p>\n
then, and in any such event, (A) if such event is an Event of Default specified
\nin clause (i) or (ii) of paragraph (f) of this Section with respect to the
\nBorrower, automatically the Commitments shall immediately terminate and the
\nLoans hereunder (with accrued interest thereon) and all other amounts owing
\nunder this Agreement shall immediately become due and payable, and (B) if such
\nevent is any other Event of Default, either or both of the following actions
\nmay be taken: (i) with the consent of the Required Lenders, the Agent may, or
\nupon the request of the Required Lenders, the Agent shall, by notice to the
\nBorrower declare the Commitments to be terminated
\n 43
\n 38<\/p>\n
forthwith, whereupon the Commitments shall immediately terminate; and (ii) with
\nthe consent of the Required Lenders, the Agent may, or upon the request of the
\nRequired Lenders, the Agent shall, by notice to the Borrower, declare the Loans
\nhereunder (with accrued interest thereon) and all other amounts owing under
\nthis Agreement to be due and payable forthwith, whereupon the same shall
\nimmediately become due and payable. Except as expressly provided above in this
\nSection, presentment, demand, protest and all other notices of any kind are
\nhereby expressly waived.<\/p>\n
SECTION 8. THE AGENT<\/p>\n
8.1 Appointment. Each Lender hereby irrevocably designates
\nand appoints the Agent as the agent of such Lender under this Agreement and the
\nother Loan Documents, and each such Lender irrevocably authorizes the Agent, in
\nsuch capacity, to take such action on its behalf under the provisions of this
\nAgreement and the other Loan Documents and to exercise such powers and perform
\nsuch duties as are expressly delegated to the Agent by the terms of this
\nAgreement and the other Loan Documents, together with such other powers as are
\nreasonably incidental thereto. Notwithstanding any provision to the contrary
\nelsewhere in this Agreement, the Agent shall not have any duties or
\nresponsibilities, except those expressly set forth herein, or any fiduciary
\nrelationship with any Lender, and no implied covenants, functions,
\nresponsibilities, duties, obligations or liabilities shall be read into this
\nAgreement or any other Loan Document or otherwise exist against the Agent.<\/p>\n
8.2 Delegation of Duties. The Agent may execute any of its
\nduties under this Agreement and the other Loan Documents by or through agents
\nor attorneys-in-fact and shall be entitled to advice of counsel concerning all
\nmatters pertaining to such duties. The Agent shall not be responsible for the
\nnegligence or misconduct of any agents or attorneys in-fact selected by it with
\nreasonable care.<\/p>\n
8.3 Exculpatory Provisions. Neither the Agent nor any of its
\nofficers, directors, employees, agents, attorneys-in-fact or Affiliates shall
\nbe (i) liable for any action lawfully taken or omitted to be taken by it or
\nsuch Person under or in connection with this Agreement or any other Loan
\nDocument (except for its or such Person’s own gross negligence or willful
\nmisconduct) or (ii) responsible in any manner to any of the Lenders for any
\nrecitals, statements, representations or warranties made by the Borrower or any
\nofficer thereof contained in this Agreement or any other Loan Document or in
\nany certificate, report, statement or other document referred to or provided
\nfor in, or received by the Agent under or in connection with, this Agreement or
\nany other Loan Document or for the value, validity, effectiveness, genuineness,
\nenforceability or sufficiency of this Agreement or any other Loan Document or
\nfor any failure of the Borrower to perform its obligations hereunder or
\nthereunder. The Agent shall not be under any obligation to any Lender to
\nascertain or to inquire as to the observance or performance of any of the
\nagreements contained in, or conditions of, this Agreement or any other Loan
\nDocument, or to inspect the properties, books or records of the Borrower.<\/p>\n
8.4 Reliance by Agent. The Agent shall be entitled to rely,
\nand shall be fully protected in relying, upon any Note, writing, resolution,
\nnotice, consent, certificate, affidavit, letter, telecopy, telex or teletype
\nmessage, statement, order or other document or conversation believed by it to
\nbe genuine and correct and to have been signed, sent or made by the proper
\nPerson or Persons and upon advice and statements of legal counsel (including,
\nwithout limitation, counsel to the Borrower), independent accountants and other
\nexperts selected by the Agent. The
\n 44
\n 39<\/p>\n
Agent may deem and treat the payee of any Note as the owner thereof for all
\npurposes unless a written notice of assignment, negotiation or transfer thereof
\nshall have been filed with the Agent. The Agent shall be fully justified in
\nfailing or refusing to take any action under this Agreement or any other Loan
\nDocument unless it shall first receive such advice or concurrence of the
\nRequired Lenders as it deems appropriate or it shall first be indemnified to
\nits satisfaction by the Lenders against any and all liability and expense which
\nmay be incurred by it by reason of taking or continuing to take any such
\naction. The Agent shall in all cases be fully protected in acting, or in
\nrefraining from acting, under this Agreement and the other Loan Documents in
\naccordance with a request of the Required Lenders, and such request and any
\naction taken or failure to act pursuant thereto shall be binding upon all the
\nLenders and all future holders of the Revolving Credit Loans.<\/p>\n
8.5 Notice of Default. The Agent shall not be deemed to have
\nknowledge or notice of the occurrence of any Default or Event of Default
\nhereunder unless the Agent has received notice from a Lender or the Borrower
\nreferring to this Agreement, describing such Default or Event of Default and
\nstating that such notice is a “notice of default”. In the event that the Agent
\nreceives such a notice, the Agent shall give notice thereof to the Lenders.
\nThe Agent shall take such action with respect to such Default or Event of
\nDefault as shall be reasonably directed by the Required Lenders; provided that
\nunless and until the Agent shall have received such directions, the Agent may
\n(but shall not be obligated to) take such action, or refrain from taking such
\naction, with respect to such Default or Event of Default as it shall deem
\nadvisable in the best interests of the Lenders.<\/p>\n
8.6 Non-Reliance on Agent and Other Lenders. Each Lender
\nexpressly acknowledges that neither the Agent nor any of its officers,
\ndirectors, employees, agents, attorneys-in-fact or Affiliates has made any
\nrepresentations or warranties to it and that no act by the Agent hereinafter
\ntaken, including any review of the affairs of the Borrower, shall be deemed to
\nconstitute any representation or warranty by the Agent to any Lender. Each
\nLender represents to the Agent that it has, independently and without reliance
\nupon the Agent or any other Lender, and based on such documents and information
\nas it has deemed appropriate, made its own appraisal of and investigation into
\nthe business, operations, property, financial and other condition and
\ncreditworthiness of the Borrower and made its own decision to make its
\nRevolving Credit Loans hereunder and enter into this Agreement. Each Lender
\nalso represents that it will, independently and without reliance upon the Agent
\nor any other Lender, and based on such documents and information as it shall
\ndeem appropriate at the time, continue to make its own credit analysis,
\nappraisals and decisions in taking or not taking action under this Agreement
\nand the other Loan Documents, and to make such investigation as it deems
\nnecessary to inform itself as to the business, operations, property, financial
\nand other condition and creditworthiness of the Borrower. Except for notices,
\nreports and other documents expressly required to be furnished to the Lenders
\nby the Agent hereunder, the Agent shall not have any duty or responsibility to
\nprovide any Lender with any credit or other information concerning the
\nbusiness, operations, property, condition (financial or otherwise), prospects
\nor creditworthiness of the Borrower which may come into the possession of the
\nAgent or any of its officers, directors, employees, agents, attorneys-in-fact
\nor Affiliates.<\/p>\n
8.7 Indemnification. The Lenders agree to indemnify the
\nAgent in its capacity as such (to the extent not reimbursed by the Borrower and
\nwithout limiting the obligation of the Borrower to do so), ratably according to
\ntheir respective Commitment Percentages in effect on the date on which
\nindemnification is sought (or, if indemnification is sought after the date upon
\n 45
\n 40<\/p>\n
which the Commitments shall have terminated and the Revolving Credit Loans
\nshall have been paid in full, ratably in accordance with their Commitment
\nPercentages immediately prior to such date), from and against any and all
\nliabilities, obligations, losses, damages, penalties, actions, judgments,
\nsuits, costs, expenses or disbursements of any kind whatsoever which may at any
\ntime (including, without limitation, at any time following the payment of the
\nRevolving Credit Loans) be imposed on, incurred by or asserted against the
\nAgent in any way relating to or arising out of, the Commitments, this
\nAgreement, any of the other Loan Documents or any documents contemplated by or
\nreferred to herein or therein or the transactions contemplated hereby or
\nthereby or any action taken or omitted by the Agent under or in connection with
\nany of the foregoing; provided that no Lender shall be liable for the payment
\nof any portion of such liabilities, obligations, losses, damages, penalties,
\nactions, judgments, suits, costs, expenses or disbursements resulting solely
\nfrom the Agent’s gross negligence or willful misconduct. The agreements in
\nthis subsection shall survive the payment of the Revolving Credit Loans and all
\nother amounts payable hereunder.<\/p>\n
8.8 Agent in Its Individual Capacity. The Agent and its
\nAffiliates may make loans to, accept deposits from and generally engage in any
\nkind of business with the Borrower as though the Agent were not the Agent
\nhereunder and under the other Loan Documents. With respect to the Revolving
\nCredit Loans made by it, the Agent shall have the same rights and powers under
\nthis Agreement and the other Loan Documents as any Lender and may exercise the
\nsame as though it were not the Agent, and the terms “Lender” and “Lenders”
\nshall include the Agent in its individual capacity.<\/p>\n
8.9 Successor Agent. The Agent may resign as Agent upon 10
\ndays’ notice to the Lenders. If the Agent shall resign as Agent under this
\nAgreement and the other Loan Documents, then the Required Lenders shall appoint
\nfrom among the Lenders a successor agent for the Lenders, which successor agent
\nshall be approved by the Borrower, whereupon such successor agent shall succeed
\nto the rights, powers and duties of the Agent, and the term “Agent” shall mean
\nsuch successor agent effective upon such appointment and approval, and the
\nformer Agent’s rights, powers and duties as Agent shall be terminated, without
\nany other or further act or deed on the part of such former Agent or any of the
\nparties to this Agreement or any holders of the Revolving Credit Loans. After
\nany retiring Agent’s resignation as Agent, the provisions of this Section 8
\nshall inure to its benefit as to any actions taken or omitted to be taken by it
\nwhile it was Agent under this Agreement and the other Loan Documents.<\/p>\n
8.10 Co-Agent. Notwithstanding any provision to the contrary
\nelsewhere in this Agreement, the Co- Agent shall not have any duties or
\nresponsibilities, except those expressly set forth herein, or any fiduciary
\nrelationship with any Lender, and no implied covenants, functions,
\nresponsibilities, duties, obligations or liabilities shall be read into this
\nAgreement or any other Loan Document or otherwise exist against the Co-Agent.
\n 46
\n 41<\/p>\n
SECTION 9. MISCELLANEOUS<\/p>\n
9.1 Amendments and Waivers. Neither this Agreement nor any
\nother Loan Document, nor any terms hereof or thereof may be amended,
\nsupplemented or modified except in accordance with the provisions of this
\nsubsection. The Required Lenders may, or, with the written consent of the
\nRequired Lenders, the Agent may, from time to time, (a) enter into with the
\nBorrower written amendments, supplements or modifications hereto and to the
\nother Loan Documents for the purpose of adding any provisions to this Agreement
\nor the other Loan Documents or changing in any manner the rights of the Lenders
\nor of the Borrower hereunder or thereunder or (b) waive, on such terms and
\nconditions as the Required Lenders or the Agent, as the case may be, may
\nspecify in such instrument, any of the requirements of this Agreement or the
\nother Loan Documents or any Default or Event of Default and its consequences;
\nprovided, however, that no such waiver and no such amendment, supplement or
\nmodification shall (i) reduce the amount or extend the scheduled date of
\nmaturity of any Revolving Credit Loan or of any installment thereof, or reduce
\nthe stated rate of any interest or fee payable hereunder or extend the
\nscheduled date of any payment thereof or increase the amount or extend the
\nexpiration date of any Lender’s Commitment, in each case without the consent of
\neach Lender affected thereby, or (ii) amend, modify or waive any provision of
\nthis subsection or reduce the percentage specified in the definition of
\nRequired Lenders or Majority Lenders, or consent to the assignment or transfer
\nby the Borrower of any of its rights and obligations under this Agreement and
\nthe other Loan Documents, in each case without the written consent of all the
\nLenders, or (iii) amend, modify or waive any provision of Section 8 without the
\nwritten consent of the then Agent. Any such waiver and any such amendment,
\nsupplement or modification shall apply equally to each of the Lenders and shall
\nbe binding upon the Borrower, the Lenders, the Agent and all future holders of
\nthe Revolving Credit Loans. In the case of any waiver, the Borrower, the
\nLenders and the Agent shall be restored to their former positions and rights
\nhereunder and under the other Loan Documents, and any Default or Event of
\nDefault waived shall be deemed to be cured and not continuing; no such waiver
\nshall extend to any subsequent or other Default or Event of Default or impair
\nany right consequent thereon.<\/p>\n
9.2 Notices. All notices, requests and demands to or upon
\nthe respective parties hereto to be effective shall be in writing (including by
\nfacsimile transmission) and, unless otherwise expressly provided herein, shall
\nbe deemed to have been duly given or made (a) in the case of delivery by hand,
\nwhen delivered, (b) in the case of delivery by mail, three days after being
\ndeposited in the mails, postage prepaid, or (c) in the case of delivery by
\nfacsimile transmission, when sent and receipt has been confirmed, addressed as
\nfollows in the case of the Borrower and the Agent, and as set forth in Schedule
\nI in the case of the Lenders, or to such other address as may be hereafter
\nnotified by the respective parties hereto:<\/p>\n
The Borrower: Tom Brown, Inc.
\n 508 W. Wall, Suite 500
\n Midland, Texas 79701
\n Attention: Treasurer
\n Fax: (915) 682-8707
\n 47
\n 42<\/p>\n
The Agent: The Chase Manhattan Bank
\n 270 Park Avenue, 32nd Floor
\n New York, New York 10017
\n Attention: Oil and Gas Group
\n Fax: (212) 270-3899<\/p>\n
with a copy to:<\/p>\n
Chase Securities Inc.
\n 270 Park Avenue, 21st Floor
\n New York, New York 10017
\n Attention: Oil and Gas Group
\n Fax: (212) 270-2519<\/p>\n
provided that any notice, request or demand to or upon the Agent or the Lenders
\npursuant to subsection 2.2, 2.4, 2.8, 2.9 or 2.13 shall not be effective until
\nreceived.<\/p>\n
9.3 No Waiver; Cumulative Remedies. No failure to exercise
\nand no delay in exercising, on the part of the Agent or any Lender, any right,
\nremedy, power or privilege hereunder or under the other Loan Documents shall
\noperate as a waiver thereof; nor shall any single or partial exercise of any
\nright, remedy, power or privilege hereunder preclude any other or further
\nexercise thereof or the exercise of any other right, remedy, power or
\nprivilege. The rights, remedies, powers and privileges herein provided are
\ncumulative and not exclusive of any rights, remedies, powers and privileges
\nprovided by law.<\/p>\n
9.4 Survival of Representations and Warranties. All
\nrepresentations and warranties made hereunder, in the other Loan Documents and
\nin any document, certificate or statement delivered pursuant hereto or in
\nconnection herewith shall survive the execution and delivery of this Agreement
\nand the making of the Revolving Credit Loans hereunder.<\/p>\n
9.5 Payment of Expenses and Taxes. The Borrower agrees (a)
\nto pay or reimburse the Agent for all its out-of-pocket costs and expenses
\nincurred in connection with the development, preparation and execution of, and
\nany amendment, supplement or modification to, this Agreement and the other Loan
\nDocuments and any other documents prepared in connection herewith or therewith,
\nand the consummation and administration of the transactions contemplated hereby
\nand thereby, including, without limitation, the reasonable fees and
\ndisbursements of counsel to the Agent, (b) to pay or reimburse each Lender and
\nthe Agent for all its costs and expenses incurred in connection with the
\nenforcement or preservation of any rights under this Agreement, the other Loan
\nDocuments and any such other documents, including, without limitation, the fees
\nand disbursements of counsel to each Lender and of counsel to the Agent, (c) to
\npay, indemnify, and hold each Lender and the Agent harmless from, any and all
\nrecording and filing fees and any and all liabilities with respect to, or
\nresulting from any delay in paying, stamp, excise and other taxes, if any,
\nwhich may be payable or determined to be payable in connection with the
\nexecution and delivery of, or consummation or administration of any of the
\ntransactions contemplated by, or any amendment, supplement or modification of,
\nor any waiver or consent under or in respect of, this Agreement, the other Loan
\nDocuments and any such other documents, and (d) to pay, indemnify, and hold
\neach Lender and the Agent harmless from and against any and all other
\nliabilities, obligations, losses, damages, penalties, actions, judgments,
\nsuits, costs, expenses or disbursements of any kind or nature whatsoever with
\nrespect
\n 48
\n 43<\/p>\n
to the execution, delivery, enforcement, performance and administration of this
\nAgreement, the other Loan Documents and any such other documents, including,
\nwithout limitation, any of the foregoing relating to the violation of,
\nnoncompliance with or liability under, any Environmental Law applicable to the
\noperations of the Borrower, any of its Subsidiaries or any of the Properties
\n(all the foregoing in this clause (d), collectively, the “indemnified
\nliabilities”); provided, that the Borrower shall have no obligation hereunder
\nto the Agent or any Lender, as the case may be, with respect to indemnified
\nliabilities arising from (i) the gross negligence or willful misconduct of the
\nAgent or any such Lender, as the case may be, or (ii) legal proceedings
\ncommenced against the Agent or any such Lender by any security holder or
\ncreditor thereof arising out of and based upon rights afforded any such
\nsecurity holder or creditor solely in its capacity as such. The agreements in
\nthis subsection shall survive repayment of the Revolving Credit Loans and all
\nother amounts payable hereunder.<\/p>\n
9.6 Successors and Assigns; Participations and Assignments.
\n(a) This Agreement shall be binding upon and inure to the benefit of the
\nBorrower, the Lenders, the Agent and their respective successors and assigns,
\nexcept that the Borrower may not assign or transfer any of its rights or
\nobligations under this Agreement without the prior written consent of each
\nLender.<\/p>\n
(b) Any Lender may, in the ordinary course of its commercial
\nbanking business and in accordance with applicable law, at any time sell to one
\nor more banks or other entities approved by the Borrower, which approval shall
\nnot be unreasonably withheld (“Participants”) participating interests in any
\nRevolving Credit Loan owing to such Lender, any Commitment of such Lender or
\nany other interest of such Lender hereunder and under the other Loan Documents.
\nIn the event of any such sale by a Lender of a participating interest to a
\nParticipant, such Lender’s obligations under this Agreement to the other
\nparties to this Agreement shall remain unchanged, such Lender shall remain
\nsolely responsible for the performance thereof, such Lender shall remain the
\nholder of any such Revolving Credit Loan for all purposes under this Agreement
\nand the other Loan Documents, and the Borrower and the Agent shall continue to
\ndeal solely and directly with such Lender in connection with such Lender’s
\nrights and obligations under this Agreement and the other Loan Documents. The
\nBorrower agrees that if amounts outstanding under this Agreement are due or
\nunpaid, or shall have been declared or shall have become due and payable upon
\nthe occurrence of an Event of Default, each Participant shall, to the maximum
\nextent permitted by applicable law, be deemed to have the right of setoff in
\nrespect of its participating interest in amounts owing under this Agreement to
\nthe same extent as if the amount of its participating interest were owing
\ndirectly to it as a Lender under this Agreement; provided that, in purchasing
\nsuch participating interest, such Participant shall be deemed to have agreed to
\nshare with the Lenders the proceeds thereof as provided in subsection 9.7(a) as
\nfully as if it were a Lender hereunder. The Borrower also agrees that each
\nParticipant shall be entitled to the benefits of subsections 2.15, 2.16 and
\n2.17 with respect to its participation in the Commitments and the Revolving
\nCredit Loans outstanding from time to time as if it was a Lender; provided
\nthat, in the case of subsection 2.16, such Participant shall have complied with
\nthe requirements of said subsection; and provided, further, that no Participant
\nshall be entitled to receive any greater amount pursuant to any such subsection
\nthan the transferor Lender would have been entitled to receive in respect of
\nthe amount of the participation transferred by such transferor Lender to such
\nParticipant had no such transfer occurred.<\/p>\n
(c) Any Lender may, in the ordinary course of its commercial
\nbanking business and in accordance with applicable law, at any time and from
\ntime to time assign to any Lender or
\n 49
\n 44<\/p>\n
any affiliate thereof or, with the consent of the Borrower and the Agent (which
\nin each case shall not be unreasonably withheld), to an additional bank or
\nfinancial institution (“an Assignee”) all or any part of its rights and
\nobligations under this Agreement and the other Loan Documents pursuant to an
\nAssignment and Acceptance, substantially in the form of Exhibit F, executed by
\nsuch Assignee, such assigning Lender (and, in the case of an Assignee that is
\nnot then a Lender or an affiliate thereof, by the Borrower and the Agent) and
\ndelivered to the Agent for its acceptance and recording in the Register. Upon
\nsuch execution, delivery, acceptance and recording, from and after the
\neffective date determined pursuant to such Assignment and Acceptance, (x) the
\nAssignee thereunder shall be a party hereto and, to the extent provided in such
\nAssignment and Acceptance, have the rights and obligations of a Lender
\nhereunder with a Commitment as set forth therein, and (y) the assigning Lender
\nthereunder shall, to the extent provided in such Assignment and Acceptance, be
\nreleased from its obligations under this Agreement (and, in the case of an
\nAssignment and Acceptance covering all or the remaining portion of an assigning
\nLender’s rights and obligations under this Agreement, such assigning Lender
\nshall cease to be a party hereto).<\/p>\n
(d) The Agent, on behalf of the Borrower, shall maintain at
\nthe address of the Agent referred to in subsection 9.2 a copy of each
\nAssignment and Acceptance delivered to it and a register (the “Register”) for
\nthe recordation of the names and addresses of the Lenders and the Commitment
\nof, and principal amount of the Revolving Credit Loans owing to, each Lender
\nfrom time to time. The entries in the Register shall be conclusive, in the
\nabsence of manifest error, and the Borrower, the Agent and the Lenders may
\n(and, in the case of any Revolving Credit Loan or other obligation hereunder
\nnot evidenced by a Note, shall) treat each Person whose name is recorded in the
\nRegister as the owner of a Revolving Credit Loan or other obligation hereunder
\nas the owner thereof for all purposes of this Agreement and the other Loan
\nDocuments, notwithstanding any notice to the contrary. Any assignment of any
\nRevolving Credit Loan or other obligation hereunder not evidenced by a Note
\nshall be effective only upon appropriate entries with respect thereto being
\nmade in the Register. The Register shall be available for inspection by the
\nBorrower or any Lender at any reasonable time and from time to time upon
\nreasonable prior notice.<\/p>\n
(e) Upon its receipt of an Assignment and Acceptance executed
\nby an assigning Lender and an Assignee (and, in the case of an Assignee that is
\nnot then a Lender or an affiliate thereof, by the Borrower and the Agent),
\ntogether with payment by the Assignee to the Agent of a registration and
\nprocessing fee of $2500, the Agent shall (i) promptly accept such Assignment
\nand Acceptance and (ii) on the effective date determined pursuant thereto
\nrecord the information contained therein in the Register and give notice of
\nsuch acceptance and recordation to the Lenders and the Borrower.<\/p>\n
(f) The Borrower authorizes each Lender to disclose to any
\nParticipant or Assignee (each, a “Transferee”) and any prospective Transferee
\nany and all financial information in such Lender’s possession concerning the
\nBorrower and its Affiliates which has been delivered to such Lender by or on
\nbehalf of the Borrower pursuant to this Agreement or which has been delivered
\nto such Lender by or on behalf of the Borrower in connection with such Lender’s
\ncredit evaluation of the Borrower and its Affiliates prior to becoming a party
\nto this Agreement.<\/p>\n
(g) For avoidance of doubt, the parties to this Agreement
\nacknowledge that the provisions of this subsection concerning assignments of
\nRevolving Credit Loans and Notes relate only to absolute assignments and that
\nsuch provisions do not prohibit assignments creating
\n 50
\n 45<\/p>\n
security interests, including, without limitation, any pledge or assignment by
\na Lender of any Revolving Credit Loan or Note to any Federal Reserve Bank in
\naccordance with applicable law.<\/p>\n
9.7 Adjustments; Set-off. (a) If any Lender (a “benefitted
\nLender”) shall at any time receive any payment of all or part of its Revolving
\nCredit Loans, or interest thereon, or receive any collateral in respect thereof
\n(whether voluntarily or involuntarily, by set-off, pursuant to events or
\nproceedings of the nature referred to in Section 7(f), or otherwise), in a
\ngreater proportion than any such payment to or collateral received by any other
\nLender, if any, in respect of such other Lender’s Loans, or interest thereon,
\nsuch benefitted Lender shall purchase for cash from the other Lenders a
\nparticipating interest in such portion of each such other Lender’s Loan, or
\nshall provide such other Lenders with the benefits of any such collateral, or
\nthe proceeds thereof, as shall be necessary to cause such benefitted Lender to
\nshare the excess payment or benefits of such collateral or proceeds ratably
\nwith each of the Lenders; provided, however, that if all or any portion of such
\nexcess payment or benefits is thereafter recovered from such benefitted Lender,
\nsuch purchase shall be rescinded, and the purchase price and benefits returned,
\nto the extent of such recovery, but without interest.<\/p>\n
(b) In addition to any rights and remedies of the Lenders
\nprovided by law, each Lender shall have the right, without prior notice to the
\nBorrower, any such notice being expressly waived by the Borrower to the extent
\npermitted by applicable law, upon any amount becoming due and payable by the
\nBorrower hereunder (whether at the stated maturity, by acceleration or
\notherwise) to set-off and appropriate and apply against such amount any and all
\ndeposits (general or special, time or demand, provisional or final), in any
\ncurrency, and any other credits, indebtedness or claims, in any currency, in
\neach case whether direct or indirect, absolute or contingent, matured or
\nunmatured, at any time held or owing by such Lender or any branch or agency
\nthereof to or for the credit or the account of the Borrower. Each Lender
\nagrees promptly to notify the Borrower and the Agent after any such set-off and
\napplication made by such Lender; provided that the failure to give such notice
\nshall not affect the validity of such set-off and application.<\/p>\n
9.8 Counterparts. This Agreement may be executed by one or
\nmore of the parties to this Agreement on any number of separate counterparts
\n(including by facsimile transmission), and all of said counterparts taken
\ntogether shall be deemed to constitute one and the same instrument. A copy of
\nthis Agreement signed by all the parties shall be lodged with the Borrower and
\nthe Agent.<\/p>\n
9.9 Severability. Any provision of this Agreement which is
\nprohibited or unenforceable in any jurisdiction shall, as to such jurisdiction,
\nbe ineffective to the extent of such prohibition or unenforceability without
\ninvalidating the remaining provisions hereof, and any such prohibition or
\nunenforceability in any jurisdiction shall not invalidate or render
\nunenforceable such provision in any other jurisdiction.<\/p>\n
9.10 Integration. This Agreement and the other Loan
\nDocuments represent the agreement of the Borrower, the Agent and the Lenders
\nwith respect to the subject matter hereof, and there are no promises,
\nundertakings, representations or warranties by the Agent or any Lender relative
\nto the subject matter hereof not expressly set forth or referred to herein or
\nin the other Loan Documents.
\n 51
\n 46<\/p>\n
9.11 GOVERNING LAW. THIS AGREEMENT AND THE RIGHTS AND
\nOBLIGATIONS OF THE PARTIES HEREUNDER SHALL BE GOVERNED BY, AND CONSTRUED AND
\nINTERPRETED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK.<\/p>\n
9.12 Submission To Jurisdiction; Waivers. The Borrower
\nhereby irrevocably and unconditionally:<\/p>\n
(a) submits for itself and its property in any legal action
\n or proceeding relating to this Agreement and the other Loan Documents
\n to which it is a party, or for recognition and enforcement of any
\n judgment in respect thereof, to the non-exclusive general jurisdiction
\n of the Courts of the State of New York, the courts of the United
\n States of America for the Southern District of New York, and appellate
\n courts from any thereof;<\/p>\n
(b) consents that any such action or proceeding may be
\n brought in such courts and waives any objection that it may now or
\n hereafter have to the venue of any such action or proceeding in any
\n such court or that such action or proceeding was brought in an
\n inconvenient court and agrees not to plead or claim the same;<\/p>\n
(c) agrees that service of process in any such action or
\n proceeding may be effected by mailing a copy thereof by registered or
\n certified mail (or any substantially similar form of mail), postage
\n prepaid, to the Borrower at its address set forth in subsection 9.2 or
\n at such other address of which the Agent shall have been notified
\n pursuant thereto;<\/p>\n
(d) agrees that nothing herein shall affect the right to
\n effect service of process in any other manner permitted by law or
\n shall limit the right to sue in any other jurisdiction; and<\/p>\n
(e) waives, to the maximum extent not prohibited by law, any
\n right it may have to claim or recover in any legal action or
\n proceeding referred to in this subsection any special, exemplary,
\n punitive or consequential damages.<\/p>\n
9.13 Acknowledgements. The Borrower hereby acknowledges
\nthat:<\/p>\n
(a) it has been advised by counsel in the negotiation,
\n execution and delivery of this Agreement and the other Loan Documents;<\/p>\n
(b) neither the Agent nor any Lender has any fiduciary
\n relationship with or duty to the Borrower arising out of or in
\n connection with this Agreement or any of the other Loan Documents, and
\n the relationship between the Agent and the Lenders, on one hand, and
\n the Borrower, on the other hand, in connection herewith or therewith
\n is solely that of debtor and creditor; and<\/p>\n
(c) no joint venture is created hereby or by the other Loan
\n Documents or otherwise exists by virtue of the transactions
\n contemplated hereby among the Lenders or among the Borrower and the
\n Lenders.<\/p>\n
9.14 WAIVERS OF JURY TRIAL. THE BORROWER, THE AGENT
\n 52
\n 47<\/p>\n
AND THE LENDERS HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVE TRIAL BY JURY IN
\nANY LEGAL ACTION OR PROCEEDING RELATING TO THIS AGREEMENT OR ANY OTHER LOAN
\nDOCUMENT AND FOR ANY COUNTERCLAIM THEREIN.<\/p>\n
9.15 Limitation of Interest. (a) It is the intent of the
\nBorrower and the Lenders in the execution and performance of this Agreement and
\nall matters incidental and related hereto and the other Loan Documents or any
\nagreement or instrument executed in connection herewith or therewith or with
\nany Indebtedness of the Borrower to the Lenders to remain in strict compliance
\nwith all laws applicable to the Lenders from time to time in effect, including,
\nwithout limitation, usury laws. In furtherance hereof, the Borrower and the
\nLenders stipulate and agree that none of the terms and provisions contained in
\nor pertaining to this Agreement or in the other Loan Documents or any other
\nagreement or instrument (“Other Agreement”) executed in connection herewith or
\nwith any Indebtedness of the Borrower to the Lenders shall ever be construed to
\ncreate a contract to pay for the use, forbearance or detention of money with
\ninterest at a rate or in an amount in excess of the maximum amount of interest
\npermitted to be charged by the Lenders under all laws in effect and applicable
\nto the Lenders (the “Maximum Rate”). For purposes of this Agreement and the
\nRevolving Credit Notes, “interest” shall include the aggregate of all amounts
\nwhich constitute or are deemed to constitute interest under the respective laws
\nin effect and applicable to the Lenders that are contracted for, chargeable,
\nreceivable (whether received or deemed to have been received) or taken under
\nthis Agreement or the Revolving Credit Notes or any Other Agreement. The
\nBorrower shall not be required to pay interest hereunder or on any Revolving
\nCredit Note or any Other Agreement at a rate or in an amount in excess of the
\nMaximum Rate with respect to the Lenders or the maximum amount of interest that
\nmay be lawfully charged by the Lenders under any law which is in effect and
\napplicable to the Lenders, and the provisions of this subsection 9.15 shall
\ncontrol over all other provisions of this Agreement and the Revolving Credit
\nNotes or any Other Agreement which may be in apparent conflict herewith. If
\nthe effective rate or amount of interest which would otherwise be payable under
\nthis Agreement or any Revolving Credit Note or any Other Agreement, or all of
\nthem, would exceed the Maximum Rate for the Lenders or the maximum amount of
\ninterest the Lenders or any holder of any Revolving Credit Note or any Other
\nAgreement is allowed by the relevant applicable law to charge, contract for,
\ntake or receive or in the event the Lenders or any holder of any Revolving
\nCredit Note or any Other Agreement shall charge, contract for, take or receive
\nmonies that are deemed to constitute interest which could, in the absence of
\nthis provision, increase the effective rate or amount of interest payable under
\nthis Agreement or any Revolving Credit Note or any Other Agreement, or all of
\nthem, to a rate or amount in excess of that permitted to be charged, contracted
\nfor, taken or received under the applicable laws then in effect with respect to
\nthe Lenders, then the principal amount of the Revolving Credit Notes or the
\nobligations of the Borrower to the Lenders under this Agreement, the Revolving
\nCredit Notes or any Other Agreement or the amount of interest which would
\notherwise be payable to or for the account of the Lenders under this Agreement
\nor the Revolving Credit Notes or any Other Agreement or all of them, shall be
\nreduced to the amount allowed under said laws as now or hereafter construed by
\nthe courts having jurisdiction, and all such monies so charged, contracted for,
\nor received that are deemed to constitute interest in excess of the Maximum
\nRate for the Lenders or maximum amount of interest permitted by the relevant
\napplicable laws shall be immediately returned to or credited to the account of
\nthe Company upon such determination. In determining whether the interest paid
\nor payable under any specific contingency exceed the Maximum Rate, the Borrower
\nand the Lenders shall, to the maximum extent permitted by applicable law, (i)
\ncharacterize any non-principal payment as an expense, fee
\n 53
\n 48<\/p>\n
(excluding attorneys’ and accountants’ fees) or premium rather than interest
\nand (ii) amortize, prorate, allocate and spread, in equal parts during the full
\nterm of the relevant Revolving Credit Note, all interest at any time contracted
\nfor, charged or received in connection with the relevant Revolving Credit Note.<\/p>\n
(b) To the extent the Lenders’ Maximum Rate is at any time
\ndetermined by the laws of the State of Texas (i) such rate shall be the “weekly
\nceiling” described in Section 303.201 of the Texas Finance Code, as supplemented
\nby Article 5069-1D.002 of the Texas Revised Civil Statutes; provided, however,
\nto the extent permitted by such Article, the Lenders by notice to the Borrower
\nmay revise the aforesaid election of such weekly ceiling as such ceiling affects
\nthe then current or future balances outstanding under the Revolving Credit Notes
\nand other Loan Documents and Other Agreements.<\/p>\n
9.16 Existing Agreement. Notwithstanding anything to the
\ncontrary contained herein, all outstanding loans under the Existing Agreement
\nshall be deemed to be Revolving Credit Loans under this Agreement with the same
\ninterest periods and Eurodollar Rate and interest with respect thereto (from
\nthe date of the making of such loans except as provided in the next sentence)
\nand shall be paid under this Agreement on the last day of each current interest
\nperiod with respect to such loans. On the date hereof U.S. Bank National
\nAssociation (“USB”) shall be deemed to have made a Revolving Credit Loan to the
\nBorrower to repay the loans of CIBC Inc. under the Existing Agreement and such
\nRevolving Credit Loan made by USB shall be at the same interest rates and
\ninterest periods with respect to the loans being repaid to CIBC Inc. and on the
\nlast date of such interest periods with respect to such existing loans the
\nBorrower shall pay to USB interest accruing from the date hereof. The
\nApplicable Margin for such existing loans being continued as Revolving Credit
\nLoans will be as provided in the Existing Agreement until but not including the
\ndate hereof and from and after the date hereof the Applicable Margin for such
\nloans shall be as provided in this Agreement.
\n 54
\n 49<\/p>\n
IN WITNESS WHEREOF, the parties hereto have caused this
\nAgreement to be duly executed and delivered by their proper and duly authorized
\nofficers as of the day and year first above written.<\/p>\n
TOM BROWN, INC.<\/p>\n
By: \/s\/ Donald L. Evans
\n ——————————————-
\n Name: Donald L. Evans
\n Title: Chairman of the Board of Directors
\n and Chief Executive Officer<\/p>\n
THE CHASE MANHATTAN BANK,
\n as Agent and as a Lender<\/p>\n
By: \/s\/ Peter M. Ling
\n ——————————————-
\n Name: Peter M. Ling
\n Title: Vice President<\/p>\n
NATIONSBANK OF TEXAS, N.A.,
\n as Co-Agent and as a Lender<\/p>\n
By: \/s\/ Frank K. Stowers
\n ——————————————-
\n Name: Frank K. Stowers
\n Title: Vice President<\/p>\n
U.S. BANK NATIONAL ASSOCIATION,
\n as a Lender<\/p>\n
By: \/s\/ Charles S. Searle
\n ——————————————-
\n Name: Charles S. Searle
\n Title: Senior Vice President
\n 55<\/p>\n
Schedule I<\/p>\n
Commitments<\/p>\n
\n
\nThe Chase Manhattan Bank $30,000,000
\nNationsBank of Texas, N.A. $22,500,000
\nU.S. Bank National Association $22,500,000
\n ———–
\n $75,000,000
\n<\/c><\/s><\/table>\n Addresses for Notices<\/p>\n
The Chase Manhattan Bank
\n 270 Park Avenue, 32nd Floor
\n New York, New York 10017
\n Attention: Oil & Gas Group
\n Fax: (212) 270-3899<\/p>\n
NationsBank of Texas, N.A.
\n 303 West Wall Street
\n Midland, Texas 79701
\n Attention: Frank K. Stowers
\n Fax: (915) 685-2009<\/p>\n
U.S. Bank National Association
\n 918 17th Street
\n CNBB0300
\n Denver, CO 80202
\n Attention: Charles S. Searle
\n Fax: (303) 585-4362<\/p>\n","protected":false},"template":"","meta":{"_acf_changed":false,"_stopmodifiedupdate":true,"_modified_date":"","_cloudinary_featured_overwrite":false},"corporate_contracts_companies":[6962],"corporate_contracts_industries":[9409],"corporate_contracts_types":[9561,9560],"class_list":["post-40990","corporate_contracts","type-corporate_contracts","status-publish","hentry","corporate_contracts_companies-brown-tom-inc","corporate_contracts_industries-energy__exploration","corporate_contracts_types-finance__credit","corporate_contracts_types-finance"],"acf":[],"_links":{"self":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts\/40990","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts"}],"about":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/types\/corporate_contracts"}],"wp:attachment":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/media?parent=40990"}],"wp:term":[{"taxonomy":"corporate_contracts_companies","embeddable":true,"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts_companies?post=40990"},{"taxonomy":"corporate_contracts_industries","embeddable":true,"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts_industries?post=40990"},{"taxonomy":"corporate_contracts_types","embeddable":true,"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts_types?post=40990"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}