Document:

Exhibit 10.2

PRIME GLOBAL CAPITAL GROUP INCORPORATED

SUBSCRIPTION AGREEMENT

PRIME
GLOBAL CAPITAL GROUP INCORPORATED, a Nevada corporation (the “Company”), has authorized capital stock
consisting of 1,000,000,000 shares of Common Stock, par value US$0.001 per share (“Common Stock”). The
Company now desires to issue and sell to the undersigned (the “Subscriber”), and the Subscriber desires to
purchase from the Company, the number of shares of Common Stock set forth below next to the Subscriber’s name on the
signature page hereto (such shares, the “Shares”) in connection with an offering of up to 628,000 shares
of Common Stock at a purchase price of US$2.887 per share (which is the 15 day VWAP of the Common Stock preceding and
including March 30, 2012),up to an aggregate of US$1,813,036 (the “Offering”).

NOW, THEREFORE,
in consideration of the mutual covenants and agreements contained in this Agreement, and other good and valuable consideration,
the receipt and sufficiency of which are hereby acknowledged, the parties hereto agree as follows:

		1.	Purchase.

		(a)	Subject to the terms and conditions hereof, the Subscriber agrees to purchase from the Company,
and the Company agrees to issue and sell to the Subscriber, the Shares at an aggregate purchase price equal to the aggregate amount
set forth next to the Subscriber’s name on the signature page hereto (the “Funds”). If the Funds are paid
in Malaysian Ringgit (RM), the parties agree that the exchange rate to US Dollars shall be RM 3.062to US $1, representing up to
an aggregate of RM 5,551,516,23(or US $1,813,036).

		(b)	The Company has authorized the issuance and sale of the Shares subject to the terms and conditions
hereof.

		(c)	Contemporaneously with the Subscriber’s execution and delivery to the Company of an executed
counterpart to this Agreement, the Subscriber shall tender the Funds to the Company by wire transfer of immediately available funds
to an account or accounts specified in writing by the Company to the Subscriber.

	2.		Delivery of Agreement. The Subscriber hereby delivers to the Company, and the
Company hereby accepts, an executed counterpart of this Subscription Agreement.

 

 

    	-1-

    	 

    

 

 

	3.		Representations and Warranties of the Subscriber. The Subscriber hereby represents
and warrants to the Company that:

 

		(a)	The Subscriber: (i) if a natural person, represents that he or she has reached the age of
21 and has full power and authority to execute and deliver this Agreement and all other related agreements or certificates and
to carry out the provisions hereof and thereof and has adequate means for providing for his or her current financial needs and
anticipated future needs and possible contingencies and emergencies and has no need for liquidity in the investment in the Shares;
(ii) if a corporation, partnership, association, joint stock company, trust, unincorporated organization or other entity,
represents that: such entity was not formed for the specific purpose of acquiring the Shares; such entity is duly organized, validly
existing and (if applicable in the applicable jurisdiction) in good standing (or similar status under local law) under the laws
of the jurisdiction of its organization; the consummation of the transactions contemplated hereby will not result in a violation
of its charter or other organizational documents; such entity has full power and authority to execute and deliver this Agreement
and all other related agreements or certificates and to carry out the provisions hereof and thereof and to purchase and hold the
Shares; the execution and delivery of this Agreement has been duly authorized by all necessary corporate or other action on its
part; and this Agreement has been duly executed and delivered on behalf of such entity; (iii) if executing this Agreement
in a representative or fiduciary capacity, represents that it has full power and authority to execute and deliver this Agreement
in such capacity and on behalf of the subscribing individual, ward, partnership, trust, estate, corporation or other entity for
whom the undersigned is executing this Agreement, and such individual, ward, partnership, trust, estate, corporation or other entity
has full right and power to perform his, her or its obligations pursuant to this Agreement and make an investment in the Company,
and that this Agreement constitutes a legal, valid and binding obligation of such subscribing individual, ward, partnership, trust,
estate, corporation or other entity; and (iv) the execution and delivery of this Agreement will not violate or be in conflict
with any order, judgment, injunction, agreement or controlling document to which the Subscriber (or, if applicable, such subscribing
individual, ward, partnership, trust, estate, corporation or other entity) is a party or by which he, she or it is bound;

 

		(b)	The Subscriber has received and reviewed this Agreement and all Exhibits hereto; it, its attorney
and its accountant have had access to, and an opportunity to review, all documents and other materials requested of the Company;
it and they have been given an opportunity to ask any and all questions of, and receive answers from, the Company concerning the
terms and conditions of the offering and to obtain all information that it or they believe necessary or appropriate to verify the
accuracy of this Agreement, all Exhibits hereto and any other documents and materials requested of the Company and to evaluate
the suitability of an investment in the Shares; and, in evaluating the suitability of an investment in the Shares, it and they
have not relied upon any representations or other information (whether oral or written);

		(c)	Assuming due execution and delivery by the Company of this Agreement, this Agreement constitutes
the legal, valid and binding obligation of the Subscriber, enforceable against the Subscriber in accordance with its terms, subject
to applicable bankruptcy, insolvency, reorganization, moratorium and other laws affecting creditors’ rights and remedies
generally and subject, as to enforceability, to general principles of equity (regardless of whether enforcement is sought in a
proceeding at law or in equity); and

		(d)	No broker has acted on behalf of the Subscriber in connection with this Agreement, and there are
no brokerage commissions, finders’ fees or commissions payable in connection herewith based on any agreement, arrangement
or understanding with the Subscriber or any action taken by the Subscriber.

	4.		Representations and Warranties for Accredited Investors. The Subscriber hereby
represents and warrants as follows:

 

		(a)	The Subscriber is acquiring the Shares for investment purposes only, for its own account, and not
with a view to, or for resale in connection with, any distribution thereof within the meaning of the Securities Act of 1933, as
amended (the “Securities Act”);

    	-2-

    	 

    

 

		(b)	The Subscriber has such knowledge and experience in financial and business matters as to be capable
of evaluating the merits and risks of its investment;

		(c)	The Subscriber is aware that it may have to bear the economic risk of such investment for an indefinite
period of time or to suffer a complete loss of its investment;

		(d)	The Subscriber understands, acknowledges and agrees (i) that the Shares have not been registered
under (and that the Company has no present intention to register the Shares under) the Securities Act or applicable state securities
law and that the offering and sale of such Shares are being made in reliance on the exemption from the registration requirements
provided by Section 4(2) of the Securities Act and the regulations promulgated thereby and analogous provisions of certain
state securities laws or in accordance with Regulation S under the Securities Act (“Regulation S”), and (ii)
that such Shares may not be sold or otherwise transferred by the Subscriber unless the Shares have been registered under the Securities
Act and applicable state securities laws or are sold or transferred in a transaction exempt therefrom;

		(e)	The Subscriber understands that no public market now exists for any of the securities issued by
the Company and that it is unlikely that a public market will ever exist for the Shares; and

		(f)	The Subscriber is an “accredited investor” within the meaning of Rule 501 of Regulation
D under the Securities Act and has completed properly and delivered an executed copy of the questionnaire attached hereto as Exhibit A.

	5.		Representations and Warranties For Non-U.S. Persons Only. The Subscriber hereby
represents and warrants the following:

 

		(a)	The Subscriber is not a U.S. Person, as such term is defined in Regulation S, was not formed under
the laws of any United States jurisdiction and was not formed for the purpose of investing in securities not registered under the
Securities Act. The term “U.S. Person” as defined in Regulation S means: (s) any natural person resident in the
United States; (t) any partnership or corporation organized or incorporated under the laws of the United States; (u) any
estate of which any executor or administrator is a U.S. Person; (v) any trust of which any trustee is a U.S. Person; (w) any
agency or branch of a foreign entity located in the United States; (x) any non-discretionary account or similar account (other
than an estate or trust) held by a dealer or other fiduciary for the benefit or account of a U.S. Person; (y) any discretionary
account or similar account (other than an estate or trust) held by a dealer or other fiduciary organized, incorporated, or (if
an individual) resident in the United States; and (z) any partnership or corporation if: (A) organized or incorporated under
the laws of any foreign jurisdiction; and (B) formed by a U.S. Person principally for the purpose of investing in securities not
registered under the Securities Act unless it is organized or incorporated, and owned by, accredited investors (as defined in Rule
501(a) under the Securities Act) that are not natural persons, estates or trusts;

		(b)	No offer or sale of the Shares was made to the Subscriber in the United States;

    	-3-

    	 

    

 

		(c)	The Subscriber is not purchasing the Shares for the account or on behalf of any U.S. Person;

		(d)	The Subscriber has not made any pre-arrangement to transfer the Shares to a U.S. Person or to return
the Shares to the United States securities markets (which includes short sales and hedging transactions in the United States within
the periods restricted under Regulation S (the “Restricted Periods”) to be covered by delivery of Shares) and
is not purchasing the Shares as part of any plan or scheme to evade the registration requirements of the Securities Act;

		(e)	The Subscriber acknowledges and understands that all offers and sales of the Shares by the Subscriber
in the United States or to U.S. Persons or otherwise, whether prior to the expiration or after the expiration of the Restricted
Periods, shall be made only pursuant to a registration of the Shares under the Securities Act or an exemption from registration
requirements of the Securities Act. The Subscriber also acknowledges and understands that the Company will, in order to approve
removal of the restrictive legend from certificates evidencing the Shares, require from the Subscriber (i) certain written
representations to indicate that the sale of the Shares was made in a transaction that complies with the provisions of Regulation
S, pursuant to a registration of the Shares under the Securities Act or pursuant to an exemption from the registration requirements
of the Securities Act and (ii) require a legal opinion in accordance with Section 8(a) hereof that removal of the legend
is appropriate;

		(f)	The Subscriber has not engaged in any “directed selling efforts” (as defined in Regulation
S) in the United States regarding the Shares, nor has it engaged in any act intended to or that reasonably might have the effect
of preconditioning the U.S. market for the resale of the Shares;

		(g)	The Subscriber is not a “distributor” as defined in Regulation S. The Subscriber acknowledges,
understands and agrees that, if the Subscriber should be deemed to be a distributor prior to reselling the Shares to a non-U.S.
Person during the Restricted Periods, the Subscriber will send a notice to each new subscriber of the Shares that such new subscriber
is subject to the restrictions of Regulation S during the Restricted Periods;

		(h)	The Subscriber is not an officer, director or “affiliate” (as that term is defined
in Rule 405 under the Securities Act) of the Company or an “underwriter” or “dealer” (as such terms are
defined in the federal securities laws of the United States), and the purchase of the Shares by the Subscriber is not a transaction
(or part of a series of transactions) that is part of any plan or scheme to evade the registration provisions of the Securities
Act. The Subscriber understands and agrees that, if the Subscriber becomes an affiliate of the Company at any time after purchasing
the Shares, every sale made by it thereafter must be made in compliance with the provisions of Rule 144 of the Securities Act (“Rule
144”) (except for the two-year holding period requirement), including the filing of Form 144 with the U.S. Securities
and Exchange Commission at the time of the sale, as required under Rule 144. The Subscriber understands and agrees that the provisions
of Rule 144, if at any time applicable to it, are separate and apart from, and independent of, any restrictions imposed by Regulation
S and will apply even after the expiration of the Restricted Periods;

		(i)	The Subscriber does not have a short position in, or other hedged position with respect to, the
Shares or the shares of Common Stock of the Company and will not have a short position in, or other hedged position with respect
to, such securities at any time prior to the expiration of the Restricted Periods; and

    	-4-

    	 

    

 

		(j)	If at any time after the expiration of the Restricted Periods the Subscriber wishes to transfer
or attempts to transfer the Shares to a U.S. Person, the Subscriber agrees to notify the Company if at such time it is an “affiliate”
of the Company or is then acting as an “underwriter,” “dealer” or “distributor” as to such
Shares (as such terms are defined in the federal securities laws of the United States or the regulations promulgated thereunder,
including, but not limited to, Regulation S), or if such transfer is being made as part of a plan or scheme to evade the registration
provisions of the Securities Act.

	6.		Representations and Warranties of the Company. The Company hereby represents
and warrants to the Subscriber that:

 

		(a)	Organization. The Company is duly organized and validly existing under the laws of the State
of Nevada and has the corporate power and authority to own its properties and assets and to carry on its business as now conducted.
The Company is duly qualified or authorized to do business as a foreign corporation in each jurisdiction in which the conduct of
its business or the ownership of its properties or assets requires such qualification or authorization, except where the failure
to be so qualified would not reasonably be expected to have, individually or in the aggregate, a material adverse effect on the
Company.

		(b)	Authorization of Agreement; Enforceability. The Company has all requisite corporate power
and authority to execute and deliver this Agreement and to perform its obligations hereunder. The execution, delivery and performance
by the Company of this Agreement have been duly authorized by all necessary corporate action on the part of the Company. This Agreement
has been duly and validly executed and delivered by the Company and, assuming the due authorization, execution and delivery thereof
by the Subscriber, this Agreement constitutes the legal, valid and binding obligation of the Company, enforceable against the Company
in accordance with its terms, subject to applicable bankruptcy, insolvency, reorganization, moratorium and other laws affecting
creditors’ rights and remedies generally and subject, as to enforceability, to general principles of equity (regardless of
whether enforcement is sought in a proceeding at law or in equity).

	7.		Reliance. The Subscriber acknowledges and agrees that the Company and its agents
are relying on the truth and accuracy of the foregoing representations and warranties in the offering of the Shares for sale to
the Subscriber without having first registered the Shares under the Securities Act. All representations, warranties and covenants
contained in this Subscription Agreement shall survive the execution and delivery of this Subscription Agreement and the consummation
of the transactions contemplated hereunder.

 

	8.		Restrictions on Transfer of the Shares.

 

		(a)	No Transfer; Opinion of Counsel. The Subscriber acknowledges that there are restrictions
on the transferability of the Shares. Since the Shares are not registered under the Securities Act or applicable state securities
laws, the Subscriber acknowledges and agrees that it shall have no right at any time to sell, assign, pledge, hypothecate, distribute
(as a dividend or otherwise), transfer or otherwise dispose of or encumber the Shares (except by will or by the laws of descent
and distribution), unless the Company shall first have been provided with an opinion of counsel acceptable to the Company
that such sale is exempt from such registration under the Securities Act and any applicable state securities laws.

    	-5-

    	 

    

 

		(b)	Restrictive Legends. The Subscriber is acquiring the Shares for its own account and not
with a view to their distribution within the meaning of Section 2(11) of the Securities Act. The Subscriber consents to the placement
of the following legend on the stock certificate(s) representing the Shares until such time as the Shares are eligible for sale
under Rule 144(k) under the Securities Act and prior to the registration for resale thereof:

“THE
SECURITIES EVIDENCED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE U.S. SECURITIES ACT OF 1933, AS AMENDED (THE ‘SECURITIES
ACT’), AND MAY NOT BE offered or sold (I) in the united states or to u.s. persons BY OR ON BEHALF OF ANY U.S. PERSON, UNLESS
(A) A REGISTRATION STATEMENT UNDER THE SECURITIES ACT IS IN EFFECT WITH RESPECT THERETO OR (B) PURSUANT TO AN EXEMPTION FROM REGISTRATION
AND A WRITTEN OPINION FROM COUNSEL FOR THE ISSUER OR COUNSEL FOR THE HOLDER REASONABLY ACCEPTABLE TO THE ISSUER HAS BEEN OBTAINED
TO THE EFFECT THAT NO SUCH REGISTRATION IS REQUIRED AND (II) OUTSIDE THE UNITED STATES, UNLESS IN COMPLIANCE WITH RULE 904 UNDER
THE SECURITIES ACT AND THE PURCHASER IN SUCH TRANSaction PROVIDES A CERTIFICATION to the issuer THAT IT IS A NON-U.S. PERSON. each
beneficial holder, by accepting an interest in THE SECURITIES REPRESENTED BY THIS CERTIFICATE, agrees that any hedging transaction
involving SUCH SECURITIES MAY not be conducted unless in compliance with the securities Act. TERMS IN THIS LEGEND HAVE THE MEANINGS
GIVEN TO THEM BY REGULATION S UNDER THE SECURITIES ACT.”

“Transfer
of securities represented by this certificate is restricted under the terms of a subscription Agreement, dated as of APRIL___, 2012
(the ‘subscription Agreement’), to which the Corporation is party. A copy of the subscription agreement will be furnished
to any stockholder upon written request, and without charge, within five (5) days after the corporation’s receipt of a written
request therefor.”

	9.		Notice to Subscriber. Correspondence and notices to the Subscriber shall be
sent to the address listed below the signature of the Subscriber on the signature page of this Agreement until such time as the
Subscriber shall notify the Company, in writing, of a different address to which such correspondence and notices are to be sent.

    	-6-

    	 

    

 

	10.		Miscellaneous.

 

		(a)	The Subscriber agrees that this Agreement is not transferable or assignable.

		(b)	The Subscriber agrees that, except as expressly permitted by any applicable state law, the Subscriber
may not cancel, terminate or revoke this Agreement or any agreement of the Subscriber made hereunder, and this Agreement shall
survive the death or legal disability of the Subscriber and shall be binding upon the Subscriber’s heirs, executors, administrators,
successors and assigns.

		(c)	This Agreement and the Exhibits hereto constitute the entire agreement among the parties hereto
with respect to the subject matter hereof and may be amended only by a writing executed by both parties.

		(d)	Headings are for convenience only and are not deemed to be part of this Agreement.

		(e)	This Agreement may be executed in two or more counterparts, each of which shall be deemed an original,
but all of which together will constitute one and the same instrument. A facsimile, telecopy or other reproduction of this Agreement
may be executed by one or more parties hereto, and an executed copy of this Agreement may be delivered by one or more parties hereto
by facsimile or similar instantaneous electronic transmission device, pursuant to which the signature of, or on behalf of, such
party can be seen, and such execution and delivery shall be considered valid, binding and effective for all purposes as of the
date first written above. At the request of any party hereto, all parties hereto agree to execute an original of this Agreement,
as well as any facsimile, telecopy or other reproduction hereof.

		(f)	This Agreement and the rights and obligations of the parties hereunder shall be enforced, governed
and construed in all respects in accordance with the internal substantive laws of the State of Nevada (without reference to principles
of conflicts or choice of law that would cause the application of the internal laws of any other jurisdiction).

		(g)	The Subscriber acknowledges that, if it is a resident of any state whose “blue sky laws”
or other local securities laws require a restriction on transferability of securities, it will comply with such restriction requirements.

		(h)	If any part of any provision of this Agreement or any other agreement or document given pursuant
to or in connection with this Agreement shall be invalid or unenforceable in any respect, such part shall be ineffective to the
extent of such invalidity or unenforceability only, without in any way affecting the remaining parts of such provision or the remaining
provisions of this Agreement.

	11.		Confidentiality. Except as may be required by applicable law or as otherwise
agreed among the parties hereto, neither the Company nor the Subscriber nor any of their respective Affiliates (as defined below)
shall at any time divulge, disclose, disseminate, announce or release any information to any person (i) concerning this Agreement
or the transactions contemplated hereby, without first obtaining the prior written consent of the other party hereto or (ii) any
trade secrets or other confidential information of the other party hereto (or its Affiliates), without first obtaining the prior
written consent of such other party hereto; provided, however, that each party shall be entitled to disclose information
with respect to the Subscriber’s investment in the Company on any reports such Subscriber furnishes to its investors or
as otherwise required by any federal, state, local or foreign law (including common law), statute, code, ordinance, rule, regulation
or other requirement or guideline. An “Affiliate” of any specified person shall mean any other person that
directly or indirectly controls, or is under common control with, or is controlled by, such specified person. As used in this
definition, “control” (including with its correlative meanings, “controlled by” and “under
common control with”) shall mean the possession, directly or indirectly, of the power to direct or cause the direction
of the management or policies of a person (whether through ownership of securities or partnership or other ownership interests,
by contract or otherwise).

[Signature
Page Follows]

    	-7-

    	 

    

 

 

IN WITNESS WHEREOF, the Subscriber
has executed this Subscription Agreement as of April ___, 2012.

 

SUBSCRIBER:

	
        ____________________

__________
	
         US$

        Total Dollar Amount of Subscription

	
         

         

             Not applicable     

        Tax Identification Number
	
         

         

         

        US$ 2.887

        Price Per Share

	 	 
	 	
         

         

        ______________________

        Total Number of Shares

 

Mailing Address and Phone Number of Subscriber:

c/o Union Hub Technology Sdn Bhd

11-2, Jalan 26/70A,

Desa Sri Hartamas

50480 Kuala Lumpur

Malaysia

Telephone: +6013 398 3183

 

Accepted and agreed to as of April ___, 2012:

PRIME GLOBAL CAPITAL
GROUP INCORPORATED

 

 

By: ____________________________________

Name: Liong Tat Teh

Title: Chief Financial Officer

    	-8-

    	 

    

 

 

Exhibit A

 

 

PRIME
GLOBAL CAPITAL GROUP INCORPORATED

 ACCREDITED INVESTOR QUESTIONNAIRE

 

 

In connection with that certain Subscription
Agreement, dated as of April ___, 2012, by and between _________________(the “Subscriber”) and Prime Global
Capital Group Incorporated, a Nevada corporation (the “Company”), pursuant to which the Subscriber has subscribed
for, and (subject to acceptance by the Company) has agreed to purchase from the Company, ___________shares (collectively, the “Shares”)
of common stock, with a par value of US$0.001 per share (“Common Stock”), of the Company the undersigned represents
and warrants to the Company as follows:

 

1. Status as “AccreditedInvestor”

 

The undersigned understands that the
sale of the Shares is limited solely to “Accredited Investors”, as that term is defined under Regulation D of the Securities
Act of 1933, as amended (the “Act”). Under Regulation D, individuals and entities meeting the qualifications
set forth below are Accredited Investors. By checking one of the boxes set forth below, the undersigned represents and warrants
to the Company that the undersigned is an Accredited Investor by reason of the qualifications described opposite the checked box:

 

A. Individual Investors.

 

	 ̈	Any natural person whose net worth, or joint net worth with that person’s spouse, at the time of the purchase exceeds US$1,000,000, excluding the value of the primary residence of such natural person or persons.
	 	 
	 ̈	Any natural person who had an individual income in excess of US$200,000 in each of the two most recent years or joint income with that person’s spouse in excess of US$300,000 in each of those years and has a reasonable expectation of reaching the same income level in the current year.
	 	 
	 ̈	Any executive officer or director of the Company.
	 	 
	B. Investor Entities.
	 	 
	 ̈	Any entity in which all of the equity owners are Accredited Investors.

 

 

	 ̈	Any trust with total assets in excess of US$5,000,000, not formed for the specific purpose of acquiring shares of Common Stock, whose purchase of shares of Common Stock is directed by a person who has such knowledge and experience in financial and business matters that such person is capable of evaluating the merits and risks of the prospective investment in shares of Common Stock. Note: If this qualification is selected, the representative of the trust must deliver to the Company a written summary of his or her knowledge and experience in financial and business matters on a separate form to be provided by the Company.
	 	 
	 ̈	Any private business development company as defined in Section 202(a)(22) of the Investment Advisers Act of 1940.
	 	 
	 ̈	Any organization described in Section 501(c)(3) of the Internal Revenue Code, corporation, Massachusetts or similar business trust, or partnership, limited liability company not formed for the specific purpose of acquiring shares of Common Stock, with total assets in excess of US$5,000,000.
	 	 

 

The undersigned
is a _____(Insert Type of Entity)_____ meeting the foregoing description.

 

 

	 ̈	Any bank as defined in Section 3(a)(2) of the Act, or any savings and loan association or other institution as defined in Section 3(a)(5)(A) of the Act whether acting in its individual or fiduciary capacity; any broker or dealer registered pursuant to Section 15 of the Securities Exchange Act of 1934, as amended; any insurance company as defined in Section 2(13) of the Act; any investment company registered under the Investment Company Act of 1940 or a business development company as defined in Section 2(a)(48) of that Act; Small Business Investment Company licensed by the U.S. Small Business Administration under Section 301(c) or (d) of the Small Business Investment Act of 1958; any plan established and maintained by a state, its political subdivisions or any agency or instrumentality of a state or its political subdivisions for the benefit of its employees, if such plan has total assets in excess of US$5,000,000; employee benefit plan within the meaning of the Employee Retirement Income Security Act of 1974 if the investment decision is made by a plan fiduciary, as defined in Section 3(21) of such Act, which is either a bank, savings and loan association, insurance company or registered investment adviser, or if the employee benefit plan has total assets in excess of US$5,000,000 or, if a self-directed plan, with investment decisions made solely by persons that are Accredited Investors.

 

The undersigned
is a ____(Insert Type of Entity)_____ meeting the foregoing description.

 

 

2. Certification as to Location of
Residence or Principal Place of Business. The undersigned represents and warrants to the Company that the undersigned is a
resident of the location listed in the address of the undersigned set forth below, or, if the undersigned is an entity, that the
principal place of business of the undersigned is such address.

 

 

 

	[Signature Block For Individuals]	[Signature Block For Entities]
	 	 
	 	Not applicable
	                                                             	                              
	(Signature)	(Name of Entity)
	 	 
	 	 
	                                                             	By: _____________________
	(Printed Name)	     Name: _________________
	 	     Title: __________________
	 	 
	 	 
	c/o Union Hub Technology Sdn Bhd	 
	11-2, Jalan 26/70A,	                   
                                       
	(Street Address of Residence)	(Street Address of Principal Office)
	 	 
	 	 
	Desa Sri Hartamas	 
	50480 Kuala Lumpur	                                                       
	(City or Town)  (State)  (Zip Code)	(City or Town)  (State)  (Zip Code)
	 	 
	 	 
	Malaysia	                                                       
	(Country)	(Country)
	 	 
	 	 
	+6013 398 3183	                                                      
	(Daytime Telephone Number)	(Daytime Telephone Number)

 

 

 

Date: April __, 2012pseapr8kx101.htm

 

EXHIBIT 10.1

Execution Version

 

Published CUSIP Number: ________________

 

AMENDED AND RESTATED CREDIT AGREEMENT

 

 

Dated as of March 29, 2012

 

 

among

 

 

PIONEER SOUTHWEST ENERGY PARTNERS L.P.,

as the Borrower,

 

 

BANK OF AMERICA, N.A.,

as Administrative Agent, Swing Line Lender

and

L/C Issuer,

 

 

WELLS FARGO BANK, N. A.,

as Syndication Agent,

 

 

BANK OF MONTREAL,

and

CITIBANK, N.A.

as Co-Documentation Agents

 

 

and

 

 

The Other Lenders Party Hereto

 

 

MERRILL LYNCH, PIERCE, FENNER & SMITH, INCORPORATED and

 

 

WELLS FARGO SECURITIES, LLC

as

Joint Lead Arrangers and Bookrunners

 

USActive 25516427.11

  

  

  

 

TABLE OF CONTENTS

 

 

Section                                                                                                                                          Page

 

	
ARTICLE I.

	
DEFINITIONS AND ACCOUNTING TERMS

	1

 

 

	
  

	
1.01

	
Defined Terms 

	
1

 

	
  

	
1.03

	
Other Interpretive Provisions 

	
26

 

	
  

	
1.04

	
Accounting Terms 

	
27

 

	
  

	
1.05

	
Rounding 

	
27

 

	
  

	
1.06

	
Times of Day 

	
28

 

	
  

	
1.07

	
Letter of Credit Amounts 

	
28

 

	
ARTICLE II.

	
THE COMMITMENTS AND CREDIT EXTENSIONS

	28

 

 

	
  

	
2.01

	
Committed Loans 

	
28

 

	
  

	
2.02

	
Borrowings, Conversions and Continuations of Committed Loans 

	
28

 

	
  

	
2.03

	
Letters of Credit 

	
29

 

	
  

	
2.04

	
Swing Line Loans 

	
38

 

	
  

	
2.05

	
Prepayments 

	
41

 

	
  

	
2.06

	
Termination or Reduction of Commitments 

	
42

 

	
  

	
2.07

	
Repayment of Loans 

	
42

 

	
  

	
2.08

	
Interest 

	
42

 

	
  

	
2.09

	
Fees 

	
43

 

	
  

	
2.10

	
Computation of Interest and Fees; Retroactive Adjustments of Applicable Rate 

	
43

 

	
  

	
2.11

	
Evidence of Debt 

	
44

 

	
  

	
2.12

	
Payments Generally; Administrative Agent’s Clawback 

	
45

 

	
  

	
2.13

	
Sharing of Payments by Lenders 

	
47

 

	
  

	
2.14

	
Extension of Maturity Date 

	
47

 

	
  

	
2.15

	
Increase in Commitments 

	
49

 

	
  

	
2.16

	
Cash Collateral for L/C Issuer 

	
50

 

	
  

	
2.17

	
Defaulting Lenders 

	
50

 

 

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ARTICLE III.

	
TAXES, YIELD PROTECTION AND ILLEGALITY

	52

 

	
  

	
3.01

	
Taxes 

	
52

 

	
  

	
3.02

	
Illegality 

	
55

 

	
  

	
3.03

	
Inability to Determine Rates 

	
55

 

	
  

	
3.04

	
Increased Costs; Reserves on Eurodollar Rate Loans 

	
55

 

	
  

	
3.05

	
Compensation for Losses 

	
57

 

	
  

	
3.06

	
Mitigation Obligations; Replacement of Lenders 

	
57

 

	
  

	
3.07

	
Survival 

	
58

 

	
ARTICLE IV.

	
CONDITIONS PRECEDENT TO CREDIT EXTENSIONS

	58

 

	
  

	
4.01

	
Conditions of Effectiveness 

	
58

 

	
  

	
4.02

	
Conditions to all Credit Extensions 

	
60

 

	
ARTICLE V.

	
REPRESENTATIONS AND WARRANTIES

	60

 

	
  

	
5.01

	
Organization; Powers 

	
60

 

	
  

	
5.02

	
Authorization; Enforceability 

	
61

 

	
  

	
5.03

	
Governmental Approvals; No Conflicts 

	
61

 

	
  

	
5.04

	
Financial Statements; No Material Adverse Effect 

	
61

 

	
  

	
5.05

	
Properties 

	
62

 

	
  

	
5.06

	
Litigation and Environmental Matters 

	
62

 

	
  

	
5.07

	
Compliance with Laws; No Default 

	
62

 

	
  

	
5.08

	
Investment Company Status 

	
62

 

	
  

	
5.09

	
Taxes 

	
62

 

	
  

	
5.10

	
ERISA 

	
62

 

	
  

	
5.11

	
Disclosure 

	
63

 

	
  

	
5.12

	
Subsidiaries; Equity Interests 

	
63

 

	
  

	
5.13

	
Insurance 

	
63

 

	
  

	
5.14

	
Gas Imbalances, Prepayments 

	
63

 

	
  

	
5.15

	
Marketing of Production 

	
64

 

	
  

	
5.16

	
Swap Contracts 

	
64

 

	
  

	
5.17

	
Solvency 

	
64

 

	
  

	
5.18

	
Taxpayer Identification Number 

	
64

 

 

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ARTICLE VI.

	
AFFIRMATIVE COVENANTS

	64

 

	
  

	
6.01

	
Financial Statements 

	
64

 

	
  

	
6.02

	
Certificates; Other Information 

	
65

 

	
  

	
6.03

	
Notices of Material Events 

	
67

 

	
  

	
6.04

	
Existence; Conduct of Business 

	
68

 

	
  

	
6.05

	
Payment of Obligations 

	
68

 

	
  

	
6.06

	
Maintenance of Properties; Insurance 

	
68

 

	
  

	
6.07

	
Books and Records; Inspection Rights 

	
68

 

	
  

	
6.08

	
Compliance with Laws 

	
69

 

	
  

	
6.09

	
Use of Proceeds 

	
69

 

	
  

	
6.10

	
Operations 

	
69

 

	
  

	
6.11

	
Minimum Hedging 

	
69

 

	
  

	
6.12

	
Additional Guarantors; Designation of Unrestricted Subsidiaries 

	
69

 

	
ARTICLE VII.

	
NEGATIVE COVENANTS

	70

 

	
  

	
7.01

	
Indebtedness 

	
70

 

	
  

	
7.02

	
Liens 

	
70

 

	
  

	
7.03

	
Fundamental Changes 

	
71

 

	
  

	
7.04

	
Financial Covenants 

	
72

 

	
  

	
7.05

	
Investments, Loans, Advances and Guarantees 

	
72

 

	
  

	
7.06

	
Swap Contracts 

	
72

 

	
  

	
7.07

	
Transactions with Affiliates 

	
73

 

	
  

	
7.08

	
Restrictive Agreements 

	
73

 

	
  

	
7.09

	
Restricted Payments 

	
74

 

	
  

	
7.10

	
Negative Pledge 

	
74

 

	
  

	
7.11

	
Tax Status as Partnership; Organizational and Material Contracts 

	
74

 

	
ARTICLE VIII.

	
EVENTS OF DEFAULT AND REMEDIES

	75

 

	
  

	
8.01

	
Events of Default 

	
75

 

	
  

	
8.02

	
Remedies Upon Event of Default 

	
77

 

	
ARTICLE IX.

	
ADMINISTRATIVE AGENT

	78

 

	
  

	
9.01

	
Appointment and Authority 

	
78

 

 

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9.02

	
Rights as a Lender 

	
78

 

	
  

	
9.03

	
Exculpatory Provisions 

	
78

 

	
  

	
9.04

	
Reliance by Administrative Agent 

	
79

 

	
  

	
9.05

	
Delegation of Duties 

	
79

 

	
  

	
9.06

	
Resignation of Administrative Agent 

	
79

 

	
  

	
9.07

	
Non-Reliance on Administrative Agent and Other Lenders 

	
80

 

	
  

	
9.08

	
No Other Duties, Etc 

	
80

 

	
  

	
9.09

	
Administrative Agent May File Proofs of Claim 

	
80

 

	
  

	
9.10

	
Guaranty Matters 

	
81

 

	
ARTICLE X.

	
MISCELLANEOUS

	81

 

 

	
  

	
10.01

	
Amendments, Etc 

	
81

 

	
  

	
10.02

	
Notices; Effectiveness; Electronic Communication 

	
83

 

	
  

	
10.03

	
No Waiver; Cumulative Remedies 

	
85

 

	
  

	
10.04

	
Expenses; Indemnity; Damage Waiver 

	
85

 

	
  

	
10.05

	
Payments Set Aside 

	
87

 

	
  

	
10.06

	
Successors and Assigns 

	
88

 

	
  

	
10.07

	
Treatment of Certain Information; Confidentiality 

	
92

 

	
  

	
10.08

	
Right of Setoff 

	
93

 

	
  

	
10.09

	
Interest Rate Limitation 

	
93

 

	
  

	
10.10

	
Counterparts; Integration; Effectiveness 

	
93

 

	
  

	
10.11

	
Survival of Representations and Warranties 

	
94

 

	
  

	
10.12

	
Severability 

	
94

 

	
  

	
10.13

	
Replacement of Lenders 

	
94

 

	
  

	
10.14

	
Governing Law; Jurisdiction; Etc 

	
95

 

	
  

	
10.15

	
Waiver of Jury Trial 

	
96

 

	
  

	
10.16

	
No Advisory or Fiduciary Responsibility 

	
96

 

	
  

	
10.17

	
USA PATRIOT Act Notice 

	
97

 

	
  

	
10.18

	
No Liability of General Partner 

	
97

 

	
  

	
10.19

	
Swap Contracts and Guaranty 

	
97

 

	
  

	
10.20

	
Amendment and Restatement 

	
98

 

	
  

	
10.21

	
Assignment and Reallocation of Commitments, Etc 

	
98

 

	
  

	
10.22

	
ENTIRE AGREEMENT 

	
98

 

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SCHEDULES

	
  

	
2.01

	
Commitments and Applicable Percentages

	
  

	
5.06

	
Disclosure Matters

	
  

	
5.12

	
Subsidiaries; Other Equity Investments

	
  

	
5.14

	
Gas Imbalances; Prepayments

	
  

	
5.15

	
Marketing Agreements

	
  

	
5.16

	
Swap Contracts

	
  

	
7.02

	
Existing Liens

	
  

	
7.08

	
Existing Restrictive Agreements

	
  

	
10.02

	
Administrative Agent’s Office; Certain Addresses for Notices

 

EXHIBITS

 

Form of

	
  

	
A

	
Committed Loan Notice

	
  

	
B

	
Swing Line Loan Notice

	
  

	
C

	
Note

	
  

	
D

	
Compliance Certificate

	
  

	
E

	
Assignment and Assumption

	
  

	
F

	
First Amendment to Guaranty

	
  

	
G

	
Opinion Matters

	
  

	
H

	
General Partner Certificate

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AMENDED AND RESTATED CREDIT AGREEMENT

 

This AMENDED AND RESTATED CREDIT AGREEMENT (“Agreement”) is entered into as of March 29, 2012, among PIONEER SOUTHWEST ENERGY PARTNERS L.P., a Delaware limited partnership (the “Borrower”), each lender from time to time party hereto (collectively, the “Lenders” and individually, a “Lender”), BANK OF AMERICA, N.A., as Administrative Agent, Swing Line Lender and L/C Issuer, WELLS FARGO BANK, N. A., as Syndication Agent and MERRILL LYNCH, PIERCE, FENNER & SMITH INCORPORATED and WELLS FARGO SECURITIES, LLC, as Joint Lead Arrangers and Bookrunners.  BANK OF MONTREAL and CITIBANK, N.A., as Co-Documentation Agents.

 

RECITALS

 

WHEREAS, the Borrower entered into a Credit Agreement dated as of October 29, 2007 among the Borrower, each lender from time to time party thereto, Bank of America, N.A. as the Administrative Agent, the Swing Line Lender and the L/C Issuer, Wells Fargo Bank, N.A.,. as Syndication Agent and BMO Capital Markets Financing, Inc., as Documentation Agent (as the same may have been amended, modified or supplemented, the “Existing Credit Agreement”);

 

WHEREAS, the parties hereto have agreed to enter into this Agreement to extend, renew and continue, but not to extinguish, terminate or novate the existing Loans and to amend, restate and supersede, but not to extinguish, terminate or cause to be novated the Indebtedness under, the Existing Credit Agreement;

 

WHEREAS, the proceeds of Credit Extensions hereunder will be used for the general purposes of the Borrower and its Restricted Subsidiaries (as hereinafter defined).

 

NOW, THEREFORE, in consideration of the mutual covenants and agreements herein contained, the parties hereto agree to amend and restate the Existing Credit Agreement in its entirety as follows:

 

                             ARTICLE I.                                

 

   DEFINITIONS AND ACCOUNTING TERMS

 

1.01 Defined Terms.   As used in this Agreement, the following terms shall have the meanings set forth below:

 

“Acquisition” means the direct or indirect purchase or acquisition, whether in one or more related transactions, of (a) any Person or group of Persons, or (b) any assets or securities of any Person or group of Persons; provided, however, that notwithstanding the foregoing, the term “Acquisition” shall be deemed not to include purchase and acquisitions by a Person of property made in the ordinary course of business.

 

“Acquisition Period” means a period elected by the Borrower, with such election exercised by the Borrower delivering notice thereof to the Administrative Agent, that commences with

 

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 the funding date of the purchase price for any Specified Acquisition and ending on the earlier of (a) the last day of the fourth consecutive fiscal quarter, inclusive of the fiscal quarter in which the funding date occurred, thereafter or (b) the Borrower’s election (provided that the Borrower is in compliance with all applicable provisions of Section 7.04(b) after giving effect to such election), to terminate such election, with such election to terminate exercised by the Borrower delivering a notice thereof to the Administrative Agent; provided that (i) once any Acquisition Period is in effect, the next Acquisition Period may not commence until the termination of such current Acquisition Period then in effect, and (ii) after giving effect to the termination of such Acquisition Period then in effect, the Borrower shall be in compliance with the applicable provisions of Section 7.04(b) and no Default shall have occurred and be continuing.  For the avoidance of doubt and by way of example, the Acquisition Period for a Specified Acquisition which has a funding date occurring on March 1, 2013 would end on the earlier of (1) December 31, 2013 or (2) the Borrower’s election to terminate such election (assuming Borrower’s compliance with the foregoing clause (b)).

 

“Administrative Agent” means Bank of America in its capacity as administrative agent under any of the Loan Documents, or any successor administrative agent.

 

“Administrative Agent’s Fee Letter” means the letter agreement, dated March 5, 2012 between the Borrower and the Administrative Agent.

 

“Administrative Agent’s Office” means the Administrative Agent’s address and, as appropriate, account as set forth on Schedule 10.02, or such other address or account as the Administrative Agent may from time to time notify to the Borrower and the Lenders.

 

“Administrative Questionnaire” means an Administrative Questionnaire in a form supplied by the Administrative Agent.

 

“Affiliate” means, with respect to any Person, another Person that directly, or indirectly through one or more intermediaries, Controls or is Controlled by or is under common Control with the Person specified.

 

“Aggregate Commitments” means the Commitments of all the Lenders.  The initial Aggregate Commitments is $300,000,000.

 

“Agreement” means this Amended and Restated Credit Agreement, as the same may be amended, modified, restated, or replaced from time to time.

 

“Applicable Percentage” means with respect to any Lender at any time, the percentage (carried out to the ninth decimal place) of the Aggregate Commitments represented by such Lender’s Commitment at such time.  If the commitment of each Lender to make Loans and the obligation of the L/C Issuer to make L/C Credit Extensions have been terminated pursuant to Section 8.02 or if the Aggregate Commitments have expired, then the Applicable Percentage of each Lender shall be determined based on the Applicable Percentage of such Lender most recently in effect, giving effect to any subsequent assignments.  The initial Applicable Percentage of each Lender is set forth opposite the name of such Lender on Schedule 2.01 or in the Assignment and Assumption pursuant to which such Lender becomes a party hereto, as applicable.

 

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“Applicable Rate” means the following percentages per annum, based upon the Consolidated Leverage Ratio as set forth in the most recent Compliance Certificate received by the Administrative Agent pursuant to Section 6.02(b):

 

Applicable Rate

 

	  	  	  	

Eurodollar

Rate

	  
	
Pricing

Level

	
Consolidated

Leverage Ratio

	
Commitment

Fee

	
Letters of

Credit

	
Base Rate

	
1

	
≥ 3.00:1

	
0.375%

	
2.000%

	
1.000%

	
2

	
≥ 2.00:1 but < 3.00:1

	
0.325%

	
1.750%

	
0.750%

	
3

	
< 2.00:1

	
0.275%

	
1.625%

	
0.625%

 

Any increase or decrease in the Applicable Rate resulting from a change in the Consolidated Leverage Ratio shall become effective as of the first Business Day immediately following the date a Compliance Certificate is delivered pursuant to Section 6.02(b); provided, however, that if a Compliance Certificate is not delivered when due in accordance with such Section, then Pricing Level 1 shall apply as of the first Business Day after the date on which such Compliance Certificate was required to have been delivered.  The Applicable Rate in effect from the Closing Date through the first Business Day immediately following the date a Compliance Certificate is delivered pursuant to Section 6.02(b) for the fiscal quarter ending March 31, 2012 shall be determined based upon the certified calculation of the Consolidated Leverage Ratio delivered by the Borrower in accordance with Section 6.02(b) of the Existing Credit Agreement for the fiscal quarter ending December 31, 2011.

 

Notwithstanding anything to the contrary contained in this definition, the determination of the Applicable Rate for any period shall be subject to the provisions of Section 2.10(b).

 

“Approved Fund” means any Fund that is administered or managed by (a) a Lender, (b) an Affiliate of a Lender or (c) an entity or an Affiliate of an entity that administers or manages a Lender.

 

“Arrangers’ Fee Letter” means the letter agreement, dated March 5, 2012 among the Borrower, the Administrative Agent, the Syndication Agent and the Co-Arrangers.

 

“Assignee Group” means two or more Eligible Assignees that are Affiliates of one another or two or more Approved Funds managed by the same investment advisor.

 

“Assignment and Assumption” means an assignment and assumption entered into by a Lender and an assignee (with the consent of any party whose consent is required by Section 10.06(b)), and accepted by the Administrative Agent, in substantially the form of Exhibit E or any other form approved by the Administrative Agent.

 

“Audited Financial Statements” means the audited Consolidated balance sheet of the predecessor to the Borrower and its Consolidated Subsidiaries as of December 31, 2011, and the related Consolidated

 

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statements of income or operations, owner’s net equity and cash flows for such fiscal year of the predecessor of the Borrower and its Consolidated Subsidiaries, including the notes thereto.

 

“Availability Period” means the period from and including the Closing Date to the earliest of (a) the Maturity Date, (b) the date of termination of the Aggregate Commitments pursuant to Section 2.06, and (c) the date of termination of the commitment of each Lender to make Loans and of the obligation of the L/C Issuer to make L/C Credit Extensions pursuant to Section 8.02.

 

“Bank of America” means Bank of America, N.A. and its successors.

 

“Base Rate” means for any day a fluctuating rate per annum equal to the higher of (a) the Federal Funds Rate plus 1/2 of 1%, (b) the one-month Eurodollar rate plus 1% and (c) the rate of interest in effect for such day as publicly announced from time to time by Bank of America as its “prime rate.”  The “prime rate” is a rate set by Bank of America based upon various factors including Bank of America’s costs and desired return, general economic conditions and other factors, and is used as a reference point for pricing some loans, which may be priced at, above, or below such announced rate.  Any change in such rate announced by Bank of America shall take effect at the opening of business on the day specified in the public announcement of such change.

 

“Base Rate Committed Loan” means a Committed Loan that is a Base Rate Loan.

 

“Base Rate Loan” means a Loan that bears interest based on the Base Rate.

 

“Borrower” has the meaning specified in the introductory paragraph hereto.

 

“Borrower Materials” has the meaning specified in Section 6.02.

 

“Borrowing” means a Committed Borrowing or a Swing Line Borrowing, as the context may require.

 

“Business Day” means any day other than a Saturday, Sunday or other day on which commercial banks are authorized to close under the Laws of, or are in fact closed in, the state where the Administrative Agent’s Office is located or in the State of New York and, if such day relates to any Eurodollar Rate Loan, means any such day on which dealings in Dollar deposits are conducted by and between banks in the London interbank eurodollar market.

 

“Capital Lease Obligations” of any Person means the obligations of such Person to pay rent or other amounts under any lease of (or other arrangement conveying the right to use) real or personal property, or a combination thereof, which obligations are required to be classified and accounted for as capital leases on a balance sheet of such Person under GAAP, and the amount of such obligations shall be the capitalized amount thereof determined in accordance with GAAP.

 

“Cash Collateralize” has the meaning specified in Section 2.03(g).

 

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“Change in Law” means the occurrence, after the date of this Agreement, of any of the following:  (a) the adoption or taking effect of any law, rule, regulation or treaty, (b) any change in any law, rule, regulation or treaty or in the administration, interpretation or application thereof by any Governmental Authority or (c) the making or issuance of any request, guideline or directive (whether or not having the force of law) by any Governmental Authority; provided that notwithstanding anything herein to the contrary, (x) the Dodd-Frank Wall Street Reform and Consumer Protection Act and all requests, rules, guidelines or directives thereunder or issued in connection therewith and (y) all requests, rules, guidelines or directives promulgated by the Bank for International settlements, the Basel Committee on Banking Supervision (or any successor or similar authority) or the United States regulatory authorities, in each case pursuant to Basel III, shall in each case be deemed to be a “Change of Law”, regardless of the date enacted, adopted or issued.

 

 “Change of Control” means:

 

(a) the limited partners of the Borrower approve, in one transaction or a series of transactions, a plan of complete liquidation or dissolution of the Borrower;

 

(b) the sale or other Disposition by either the General Partner or the Borrower of all or substantially all of its assets in one or more transactions to any Person;

 

(c) a transaction or event, or series of transactions or events, shall occur that results in either (i) Pioneer or an Affiliate of Pioneer ceasing to own, directly or indirectly, all of the general partnership Equity Interests issued by the Borrower or (ii) Pioneer and its Affiliates ceasing to have the power to cause the appointment of a majority of the members of the Board of Directors or equivalent governing body of each general partner of the Borrower;

 

(d) on and after the Closing Date, the failure of the Borrower and/or a wholly-owned Restricted Subsidiary to own 100% of the Equity Interests of the Operating Company; or

 

(e) a “Change in Control” as defined in the Pioneer Credit Agreement shall occur and not be waived by the lenders thereunder unless the Person so acquiring Pioneer or the successor or surviving entity to Pioneer, as applicable, has a senior long-term unsecured debt obligations rating of at least Baa3 issued by Moody’s and BBB- issued by S&P, in each case, with a stable outlook.

 

“Closing Date” means the first date all the conditions precedent in Section 4.01 are satisfied or waived in accordance with Section 10.01.

 

 “Co-Arrangers” means Merrill Lynch and Wells Fargo Securities, each acting in its capacity as joint lead-arranger and bookrunner.

 

“Code” means the Internal Revenue Code of 1986, as amended.

 

“Commitment” means, as to each Lender, its obligation to (a) make Committed Loans to the Borrower pursuant to Section 2.01, (b) purchase participations in L/C Obligations, and (c) purchase participations in Swing Line Loans, in an aggregate principal amount at any one time outstanding not to exceed the amount set forth opposite such Lender’s name on Schedule 2.01 

 

25516427                              -5-

 

 

 

 

 

 

 

or in the Assignment and Assumption pursuant to which such Lender becomes a party hereto, as applicable, as such amount may be adjusted from time to time in accordance with this Agreement.

 

“Committed Borrowing” means a borrowing consisting of simultaneous Committed Loans of the same Type and, in the case of Eurodollar Rate Loans, having the same Interest Period made by each of the Lenders pursuant to Section 2.01.

 

“Committed Loan” has the meaning specified in Section 2.01.

 

“Committed Loan Notice” means a notice of (a) a Committed Borrowing, (b) a conversion of Committed Loans from one Type to the other, or (c) a continuation of Eurodollar Rate Loans, pursuant to Section 2.02(a), which, if in writing, shall be substantially in the form of Exhibit A.

 

“Committed Reserves” means Proved Reserves attributable to Hydrocarbon Interests for which the production of Hydrocarbons, natural gas liquids and carbon dioxide is contractually committed to be gathered, treated, processed, stored or transported by, on, or at Midstream Assets owned by the Borrower and its Restricted Subsidiaries pursuant to Services Contracts.

 

“Compliance Certificate” means a certificate substantially in the form of Exhibit D.

 

“Consolidated” means the consolidation of any Person, in accordance with GAAP, with its properly Consolidated Subsidiaries.  References herein to a Person’s Consolidated financial statements, financial condition, assets, liabilities, and similar references shall refer to the Consolidated financial statements, financial condition, assets, liabilities, and similar references of such Person and its properly Consolidated Subsidiaries.  For avoidance of doubt, an Unrestricted Subsidiary shall not be considered a Consolidated Subsidiary of the Borrower.

 

“Consolidated Adjusted EBITDAX” means, for any period, Consolidated EBITDAX; provided however, that if the Borrower or any Consolidated Restricted Subsidiary shall consummate any Acquisition or Disposition permitted hereunder (including the Acquisition of additional Restricted Subsidiaries, but exclusive of the Acquisition of Unrestricted Subsidiaries) involving assets with a fair market value equal to or greater than the Threshold Amount during the period of the four fiscal quarters ending on the last day of the fiscal quarter immediately preceding the date of determination for which the most recent financial statements and related Compliance Certificate were delivered to the Administrative Agent pursuant to Sections 6.01(a) and (b) and Section 6.02(b), then Consolidated EBITDAX shall be calculated, in a manner reasonably satisfactory to the Administrative Agent, (a) giving pro forma effect to such Acquisition or Disposition as if such Acquisition or Disposition occurred on the first day of such calculation period and (b) giving other pro forma adjustments for highly certain, clearly definable and defensible items arising in connection with any Acquisition permitted hereunder which such adjustments shall be made in a manner reasonably satisfactory to the Administrative Agent.

 

“Consolidated EBITDAX” means, for any period, for the Borrower and its Consolidated Restricted Subsidiaries on a Consolidated basis, an amount equal to Consolidated Net Income for such period plus (a) the following to the extent deducted in calculating such Consolidated Net 

 

25516427                            -6-

 

 

 

 

 

 

 

Income: (i) Consolidated Interest Charges for such period, (ii) the provision for Federal, state, local and foreign income tax expenses of the Borrower and its Consolidated Restricted Subsidiaries for such period, (iii) all amounts attributable to depreciation, depletion and amortization expenses for such period, (iv) non-cash losses or charges resulting under provisions of FASB Statement of Financial Accounting Standards (“SFAS”) 133, as amended, or any SFAS replacing, modifying or superseding such statement, resulting from the net change in Borrower’s (or any Restricted Subsidiary’s) portfolio of commodity price risk management activities, (v) non-cash losses or charges under provisions of SFAS 143 or SFAS 144, or any SFAS replacing, modifying or superseding such statements, (vi) exploration and abandonment expenses to the extent deducted from such Consolidated Net Income under successful efforts accounting, (vii) non-cash equity based compensation expenses, (viii) non-cash losses on the disposition of assets, and (ix) other non-recurring expenses of the Borrower and its Consolidated Restricted Subsidiaries reducing such Consolidated Net Income which do not represent a cash item in such period or any future period and minus (b) the following to the extent included in calculating such Consolidated Net Income: (i) Federal, state, local and foreign income tax credits of the Borrower and its Consolidated Restricted Subsidiaries for such period, (ii) non-cash gains or credits resulting under provisions of SFAS 133, as amended, or any SFAS replacing, modifying or superseding such statement, resulting from the net change in Borrower’s (or any Restricted Subsidiary’s) portfolio of commodity price risk management activities, (iii) non-cash gains on the disposition of assets and (iv) all other non-cash items increasing Consolidated Net Income for such period.  For avoidance of doubt, Consolidated Net Income attributable to Unrestricted Subsidiaries and Persons that are not Subsidiaries shall not be considered in calculating Consolidated EBITDAX.

 

“Consolidated Indebtedness” means, as of any date of determination, all Indebtedness (without duplication) of the Borrower and its Consolidated Restricted Subsidiaries on a Consolidated basis, excluding Indebtedness of the Unrestricted Subsidiaries, including any Indebtedness proposed to be incurred on such date of determination and excluding (a) all Indebtedness to be paid on such date of determination with the proceeds thereof and (b) excluding any Indebtedness described in clause (g) of the definition of Indebtedness herein.

 

“Consolidated Interest Charges” means, for any period, for the Borrower and its Consolidated Restricted Subsidiaries on a consolidated basis, the sum of (a) all interest, premium payments, debt discount, fees, charges and related expenses of the Borrower and its Consolidated Restricted Subsidiaries in connection with borrowed money (including capitalized interest) or in connection with the deferred purchase price of assets, in each case to the extent treated as interest in accordance with GAAP, (b) the portion of rent expense of the Borrower and its Consolidated Restricted Subsidiaries with respect to such period under capital leases that is treated as interest in accordance with GAAP and (c) letter of credit fees actually paid, to the extent treated as interest expense in accordance with GAAP.

 

“Consolidated Leverage Ratio” means, as of any date of determination, the ratio of (a) Consolidated Indebtedness as of such date to (b) Consolidated Adjusted EBITDAX for the period of the four fiscal quarters most recently ended.

 

“Consolidated Net Income” means, for any period, for the Borrower and its Consolidated Restricted Subsidiaries on a Consolidated basis, the net income (or loss) of the Borrower and its 

25516427                            -7-

 

 

 

 

 

 

Consolidated Restricted Subsidiaries (excluding extraordinary gains and extraordinary losses) for that period, exclusive of (a) the portion of net income (or loss) of the Borrower and its Consolidated Restricted Subsidiaries allocable to minority interests in unconsolidated Persons or Unrestricted Subsidiaries to the extent that cash dividends or distributions have not actually been received by the Borrower or one of its Consolidated Restricted Subsidiaries and (b) the portion of net income (or loss) of the Borrower and its Consolidated Restricted Subsidiaries allocable to any Equity Interests in the Consolidated Restricted Subsidiaries that are owned by Persons other than the Borrower and its Consolidated Restricted Subsidiaries.

 

“Contractual Obligation” means, as to any Person, any provision of any security issued by such Person or of any agreement, instrument or other undertaking to which such Person is a party or by which it or any of its property is bound.

 

“Control” means the possession, directly or indirectly, of the power to direct or cause the direction of the management or policies of a Person, whether through the ability to exercise voting power, by contract or otherwise.  “Controlling” and “Controlled” have meanings correlative thereto.

 

“Credit Extension” means each of the following:  (a) a Borrowing and (b) an L/C Credit Extension.

 

“Debtor Relief Laws” means the Bankruptcy Code of the United States, and all other liquidation, conservatorship, bankruptcy, assignment for the benefit of creditors, moratorium, rearrangement, receivership, insolvency, reorganization, or similar debtor relief Laws of the United States or other applicable jurisdictions from time to time in effect and affecting the rights of creditors generally.

 

“Default” means any event or condition that constitutes an Event of Default or that, with the giving of any notice, the passage of time, or both, would be an Event of Default.

 

“Default Rate” means (a) when used with respect to Obligations other than Letter of Credit Fees, an interest rate equal to (i) the Base Rate plus (ii) the Applicable Rate, if any, applicable to Base Rate Loans plus (iii) 2% per annum; provided, however, that with respect to a Eurodollar Rate Loan, the Default Rate shall be an interest rate equal to the interest rate (including any Applicable Rate) otherwise applicable to such Loan plus 2% per annum, and (b) when used with respect to Letter of Credit Fees, a rate equal to the Applicable Rate plus 2% per annum.

 

“Defaulting Lender” means any Lender that, as reasonably determined by the Administrative Agent, (a) has failed to perform any of its funding obligations hereunder, including in respect of its Loans or participations in respect of Letters of Credit or Swing Line Loans, within three Business Days of the date required to be funded by it hereunder unless, in the case of any Loan, such Lender notifies the Administrative Agent and the Borrower in writing that such failure is the result of such Lender’s determination that one or more conditions precedent to funding (each of which conditions precedent, together with any applicable default, shall be specifically identified in such writing) has not been satisfied, (b) has notified the Borrower, or the Administrative Agent that it does not intend to comply with its funding 

 

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obligations or has made a public statement to that effect with respect to its funding obligations hereunder or generally under other agreements in which it commits to extend credit (unless such writing or public statement relates to such Lender’s obligation to fund a Loan hereunder and states that such position is based on such Lender’s determination that a condition precedent to funding (which condition precedent, together with any applicable default, shall be specifically identified in such writing or public statement) cannot be satisfied), (c) has failed, within three Business Days after request by the Administrative Agent, to confirm to the Administrative Agent that it will comply with its funding obligations (provided that such Lender shall cease to be a Defaulting Lender pursuant to this clause (c) upon receipt of such written confirmation by the Administrative Agent and the Borrower), or (d) has, or has a direct or indirect parent company that has, (i) become the subject of a proceeding under any Debtor Relief Law, (ii) had a receiver, conservator, trustee, administrator, assignee for the benefit of creditors or similar Person charged with reorganization or liquidation of its business or a custodian appointed for it, or (iii) taken any action in furtherance of, or indicated its consent to, approval of or acquiescence in any such proceeding or appointment; provided that a Lender shall not be a Defaulting Lender solely by virtue of the ownership or acquisition of any equity interest in that Lender or any direct or indirect parent company thereof by a Governmental Authority so long as such ownership interest does not result in or provide such Lender with immunity from the jurisdiction of courts within the United States or from the enforcement of judgments or writs of attachment on its assets or permit such Lender (or such Governmental Authority) to reject, repudiate, disavow or disaffirm any contracts or agreements made with such Lender.

 

“Determination Date” means each of (a) the Closing Date, (b) the last day of each fiscal quarter, (c) the date set forth in any PV to Consolidated Indebtedness Compliance Certificate required to be delivered pursuant to Section 6.02(g), (d) the date specified in any Request for Credit Extension (other than a Committed Loan Notice requesting only a conversion of Committed Loans to the other Type or a continuation of Eurodollar Rate Loans), (e) the date specified in any certificate required to be delivered pursuant to Section 2.14(f), (f) the date specified in any certificate required to be delivered pursuant to Section 2.15(e), (g) the date of the consummation of any fundamental changes as described in Section 7.03, and (h) the date any Restricted Payment permitted under Section 7.09(c) is declared or made.

 

“Disclosed Matters” means the actions, suits and proceedings and the environmental matters disclosed in Schedule 5.06, disclosed in any filing with the SEC or as otherwise disclosed in writing from time to time to Administrative Agent.

 

“Disposition” or “Dispose” means the sale, transfer, license, lease or other disposition (including any sale and leaseback transaction) of any property by any Person, including any sale, assignment, transfer or other disposal, with or without recourse, of any notes or accounts receivable or any rights and claims associated therewith.

 

“Dollar” and “$” mean lawful money of the United States.

 

“Domestic Subsidiary” means any Subsidiary that is organized under the laws of any political subdivision of the United States.

 

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“Eligible Assignee” means any Person that meets the requirements to be an assignee under Section 10.06(b)(iii), (v) and (vi) (subject to such consents, if any, as may be required under Section 10.06(b)(iii)).

 

“Environmental Laws” means any and all Federal, state, local, and foreign statutes, laws, regulations, ordinances, rules, judgments, orders, decrees, permits, concessions, grants, franchises, licenses, agreements or governmental restrictions relating to pollution and the protection of the environment or the release of any materials into the environment, including those related to hazardous substances or wastes, air emissions and discharges to waste or public systems.

 

“Environmental Liability” means any liability, contingent or otherwise (including any liability for damages, costs of environmental remediation, fines, penalties or indemnities), of the Borrower, any other Loan Party or any of their respective Subsidiaries directly or indirectly resulting from or based upon (a) violation of any Environmental Law, (b) the generation, use, handling, transportation, storage, treatment or disposal of any Hazardous Materials, (c) exposure to any Hazardous Materials, (d) the release or threatened release of any Hazardous Materials into the environment or (e) any contract, agreement or other consensual arrangement pursuant to which liability is assumed or imposed with respect to any of the foregoing.

 

“Equity Interests” means, with respect to any Person, all of the shares of capital stock of (or other ownership or profit interests in) such Person, all of the warrants, options or other rights for the purchase or acquisition from such Person of shares of capital stock of (or other ownership or profit interests in) such Person, all of the securities convertible into or exchangeable for shares of capital stock of (or other ownership or profit interests in) such Person or warrants, rights or options for the purchase or acquisition from such Person of such shares (or such other interests), and all of the other ownership or profit interests in such Person (including partnership, member or trust interests therein), whether voting or nonvoting, and whether or not such shares, warrants, options, rights or other interests are outstanding on any date of determination.

 

“ERISA” means the Employee Retirement Income Security Act of 1974, as amended from time to time.

 

“ERISA Affiliate” means any trade or business (whether or not incorporated) under common control with the Borrower within the meaning of Section 414(b) or (c) of the Code (and Sections 414(m) and (o) of the Code for purposes of provisions relating to Section 412 of the Code).

 

“ERISA Event” means (a) a Reportable Event with respect to a Pension Plan; (b) a withdrawal by the Borrower or any ERISA Affiliate from a Pension Plan subject to Section 4063 of ERISA during a plan year in which it was a substantial employer (as defined in Section 4001(a)(2) of ERISA) or a cessation of operations that is treated as such a withdrawal under Section 4062(e) of ERISA; (c) a complete or partial withdrawal by the Borrower or any ERISA Affiliate from a Multiemployer Plan or notification that a Multiemployer Plan is in reorganization; (d) the filing of a notice of intent to terminate, the treatment of a Plan amendment as a termination under Section 4041 or 4041A of ERISA, or the commencement of proceedings by the PBGC to terminate a Pension Plan or Multiemployer Plan; (e) an event or condition which 

 

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constitutes grounds under Section 4042 of ERISA for the termination of, or the appointment of a trustee to administer, any Pension Plan or Multiemployer Plan; or (f) the imposition of any liability under Title IV of ERISA, other than for PBGC premiums due but not delinquent under Section 4007 of ERISA, upon the Borrower or any ERISA Affiliate.

 

“Eurodollar Rate” means, for any Interest Period with respect to a Eurodollar Rate Loan, the rate per annum equal to the British Bankers Association LIBOR Rate (“BBA LIBOR”), as published by Reuters (or other commercially available source providing quotations of BBA LIBOR as designated by the Administrative Agent from time to time) at approximately 11:00 a.m., London time, two Business Days prior to the commencement of such Interest Period, for Dollar deposits (for delivery on the first day of such Interest Period) with a term equivalent to such Interest Period.  If such rate is not available at such time for any reason, then the “Eurodollar Rate” for such Interest Period shall be the rate per annum determined by the Administrative Agent to be the rate at which deposits in Dollars for delivery on the first day of such Interest Period in same day funds in the approximate amount of the Eurodollar Rate Loan being made, continued or converted by Bank of America and with a term equivalent to such Interest Period would be offered by Bank of America’s London Branch to major banks in the London interbank eurodollar market at their request at approximately 11:00 a.m. (London time) two Business Days prior to the commencement of such Interest Period.

 

“Eurodollar Rate Loan” means a Committed Loan that bears interest at a rate based on the Eurodollar Rate.

 

“Event of Default” has the meaning specified in Section 8.01.

 

“Excluded Taxes” means, with respect to the Administrative Agent, any Lender, the L/C Issuer or any other recipient of any payment to be made by or on account of any obligation of the Borrower hereunder, (a) taxes imposed on or measured by its overall net income (however denominated), and franchise taxes imposed on it (in lieu of net income taxes), by the jurisdiction (or any political subdivision thereof) under the laws of which such recipient is organized or in which its principal office is located or, in the case of any Lender, in which its applicable Lending Office is located, (b) any branch profits taxes imposed by the United States or any similar tax imposed by any other jurisdiction in which the Borrower is located (c) in the case of a Foreign Lender (other than an assignee pursuant to a request by the Borrower under Section 10.13), any withholding tax that is imposed on amounts payable to such Foreign Lender at the time such Foreign Lender becomes a party hereto (or designates a new Lending Office) or is attributable to such Foreign Lender’s failure or inability (other than as a result of a Change in Law) to comply with Section 3.01(e), except to the extent that such Foreign Lender (or its assignor, if any) was entitled, at the time of designation of a new Lending Office (or assignment), to receive additional amounts from the Borrower with respect to such withholding tax pursuant to Section 3.01(a), or (d) any withholding tax that is required by the Code to be withheld from amounts payable to a Lender is imposed as a result of such recipient’s failure or inability to comply with the requirements of FATCA to establish an exemption from such withholding tax pursuant to FATCA.

 

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“FATCA” means Section 1471 through 1474 of the Code, as of the date of this Agreement, and amended or successor versions of these Sections and any current or future regulations or official interpretations thereof.

 

“Federal Funds Rate” means, for any day, the rate per annum equal to the weighted average of the rates on overnight Federal funds transactions with members of the Federal Reserve System arranged by Federal funds brokers on such day, as published by the Federal Reserve Bank of New York on the Business Day next succeeding such day; provided that (a) if such day is not a Business Day, the Federal Funds Rate for such day shall be such rate on such transactions on the next preceding Business Day as so published on the next succeeding Business Day, and (b) if no such rate is so published on such next succeeding Business Day, the Federal Funds Rate for such day shall be the average rate (rounded upward, if necessary, to a whole multiple of 1/100 of 1%) charged to Bank of America on such day on such transactions as determined by the Administrative Agent.

 

“Fee Letters” means the Arrangers’ Fee Letter and the Administrative Agent’s Fee Letter.

 

“First Amendment to Guaranty” means the First Amendment to Guaranty substantially in the form of Exhibit F.

 

“Foreign Lender” means any Lender that is organized under the laws of a jurisdiction other than that in which the Borrower is resident for tax purposes.  For purposes of this definition, the United States, each State thereof and the District of Columbia shall be deemed to constitute a single jurisdiction.

 

“FRB” means the Board of Governors of the Federal Reserve System of the United States.

 

“Fund” means any Person (other than a natural person) that is (or will be) engaged in making, purchasing, holding or otherwise investing in commercial loans and similar extensions of credit in the ordinary course of its activities.

 

“GAAP” means generally accepted accounting principles in the United States set forth in the opinions and pronouncements of the Accounting Principles Board and the American Institute of Certified Public Accountants and statements and pronouncements of the Financial Accounting Standards Board or such other principles as may be approved by a significant segment of the accounting profession in the United States, that are applicable to the circumstances as of the date of determination, consistently applied.

 

“General Partner” means Pioneer Natural Resources GP LLC, a Delaware limited liability company, and each other Person holding general partnership Equity Interests issued by the Borrower.

 

“Governmental Authority” means the government of the United States or any other nation, or of any political subdivision thereof, whether state or local, and any agency, authority, instrumentality, regulatory body, court, central bank or other entity exercising executive, legislative, judicial, taxing, regulatory or administrative powers or functions of or pertaining to government (including any supra-national bodies such as the European Union or the European Central Bank).

 

 

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“Guarantee” of or by any Person (the “guarantor”) means (a) any obligation, contingent or otherwise, of the guarantor guaranteeing or having the economic effect of guaranteeing any Indebtedness or other obligation of any other Person (the “primary obligor”) in any manner, whether directly or indirectly, and including any obligation of the guarantor, direct or indirect, (i) to purchase or pay (or advance or supply funds for the purchase or payment of) such Indebtedness or other obligation or to purchase (or to advance or supply funds for the purchase of) any security for the payment thereof, (ii) to purchase or lease property, securities or services for the purpose of assuring the owner of such Indebtedness or other obligation of the payment thereof, or (iii) to maintain working capital, equity capital or any other financial statement condition or liquidity of the primary obligor so as to enable the primary obligor to pay such Indebtedness or other obligation or (b) any Lien on any assets of the guarantor securing any Indebtedness or other obligation of any other Person, whether or not such Indebtedness or other obligation is assumed by the guarantor (or any right, contingent or otherwise, of any holder of such Indebtedness to obtain any such Lien), provided, that the term Guarantee shall not include endorsements for collection or deposit in the ordinary course of business.  The amount of any Guarantee shall be deemed to be an amount equal to the stated or determinable amount of the related primary obligation, or portion thereof, in respect of which such Guarantee is made or, if not stated or determinable, the maximum reasonably anticipated liability in respect thereof as determined by the guaranteeing Person in good faith.  The term “Guarantee” as a verb has a corresponding meaning.

 

“Guarantors” means, collectively, the Operating Company and each other Restricted Subsidiary of the Borrower which now or hereafter executes and delivers a guaranty to the Administrative Agent pursuant to Section 4.01 or Section 6.12 and any other Person who has guaranteed some or all of the Obligations and who has been accepted by the Administrative Agent as a Guarantor.

 

“Guaranty” means the Guaranty dated as of October 29, 2007 made by the Guarantors in favor of the Administrative Agent, L/C Issuer and the Lenders as amended and modified by the First Amendment to Guaranty dated the Closing Date and as from time to time further amended, modified or supplemented .

 

“Hazardous Materials” means all explosive or radioactive substances or wastes and all hazardous or toxic substances, wastes or other pollutants, including petroleum or petroleum distillates, asbestos or asbestos-containing materials, polychlorinated biphenyls, radon gas, infectious or medical wastes and all other substances or wastes of any nature regulated pursuant to any Environmental Law.

 

“Hydrocarbon Interests” means all rights, titles, interests and estates, now owned or hereafter acquired, in and to or arising out of oil and gas leases, oil, gas and mineral leases, or other liquid or gaseous hydrocarbon leases, mineral fee or lease interests, farm-outs, overriding royalty and royalty interests, net profit interests, oil payments, production payment interests and similar mineral interests, including any reserved or residual interest of whatever nature.

 

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“Hydrocarbons” means oil, gas, casinghead gas, condensate, distillate, liquid hydrocarbons, gaseous hydrocarbons, all products refined, separated, settled and dehydrated therefrom and all products refined therefrom, including, without limitation, kerosene, liquefied petroleum gas, refined lubricating oils, diesel fuel, drip gasoline, natural gasoline, helium, sulfur and all other minerals.

 

“Impacted Lender” means (a) a Defaulting Lender or (b) a Lender as to which (i) the L/C Issuer has a good faith belief that such Lender has defaulted in fulfilling its obligations under one or more other syndicated credit facilities or (ii) an entity that Controls such Lender has been deemed insolvent or become subject to a proceeding under any Debtor Relief Law.

 

 “Indebtedness” of any Person means, without duplication,:

 

(a) all obligations of such Person for borrowed money;

 

(b) all obligations of such Person evidenced by bonds, debentures, notes or similar instruments;

 

(c) all obligations of such Person in respect of the deferred purchase price of property or services (other than customary payment terms taken in the ordinary course of business);

 

(d) all Indebtedness of others secured by (or for which the holder of such Indebtedness has an existing right, contingent or otherwise, to be secured by) any Lien on property owned or acquired by such Person, whether or not the Indebtedness secured thereby has been assumed limited, however to the lesser of (1) the amount of its liability or (2) the book value of such property;

 

(e) all Guarantees by such Person of Indebtedness of others;

 

(f) all Capital Lease Obligations of such Person;

 

(g) all obligations, contingent or otherwise, of such Person as an account party in respect of letters of credit;

 

(h) all obligations, contingent or otherwise, of such Person in respect of bankers’ acceptances;

 

(i) the amount of deferred revenue attributed to any forward sale of production for which such Person has received payment in advance other than on ordinary trade terms;

 

(j) all Synthetic Lease Obligations of such Person; and

 

(k) the undischarged balance of any production payment created by such Person or for the creation of which such Person directly or indirectly received payment.

 

The Indebtedness of any Person shall include the Indebtedness of any other entity (including any partnership in which such Person is a general partner) to the extent such Person is liable therefor as a result of such Person’s ownership interest in or other relationship with such entity, except to the extent the terms of such Indebtedness provide that such Person is not liable therefor.

 

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“Indemnified Taxes” means Taxes other than Excluded Taxes.

 

“Indemnitees” has the meaning specified in Section 10.04(b).

 

“Information” has the meaning specified in Section 10.07.

 

“Interest Payment Date” means, (a) as to any Loan other than a Base Rate Loan, the last day of each Interest Period applicable to such Loan and the Maturity Date; provided, however, that if any Interest Period for a Eurodollar Rate Loan exceeds three months, the respective dates that fall every three months after the beginning of such Interest Period shall also be Interest Payment Dates; and (b) as to any Base Rate Loan (including a Swing Line Loan), the last Business Day of each March, June, September and December and the Maturity Date.

 

 “Interest Period” means, as to each Eurodollar Rate Loan, the period commencing on the date such Eurodollar Rate Loan is disbursed or converted to or continued as a Eurodollar Rate Loan and ending on the date one, two, three or six months, or with the consent of the Administrative Agent and all Lenders, nine or twelve months, thereafter, as selected by the Borrower in its Committed Loan Notice; provided that:

 

(i) any Interest Period that would otherwise end on a day that is not a Business Day shall be extended to the next succeeding Business Day unless such Business Day falls in another calendar month, in which case such Interest Period shall end on the next preceding Business Day;

 

(ii) any Interest Period that begins on the last Business Day of a calendar month (or on a day for which there is no numerically corresponding day in the calendar month at the end of such Interest Period) shall end on the last Business Day of the calendar month at the end of such Interest Period; and

 

(iii) no Interest Period shall extend beyond the Maturity Date.

 

“Investment” means, as to any Person, any direct or indirect acquisition or investment by such Person, whether by means of (a) the purchase or other acquisition of capital stock or other securities of another Person or (b) a loan, advance or capital contribution to (whether in cash, cash equivalents or in kind), Guarantee of Indebtedness of, or purchase or other acquisition of any other Indebtedness or equity participation or interest in, another Person, including any partnership or joint venture interest in such other Person and any arrangement pursuant to which the investor Guarantees Indebtedness of such other Person.  For purposes of covenant compliance, the amount of any Investment shall be the amount actually invested, without adjustment for subsequent increases or decreases in the value of such Investment.

 

“IRS” means the United States Internal Revenue Service.

 

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“ISP” means, with respect to any Letter of Credit, the “International Standby Practices 1998” published by the Institute of International Banking Law & Practice, Inc. (or such later version thereof as may be in effect at the time of issuance).

 

“Issuer Documents” means with respect to any Letter of Credit, the Letter of Credit Application, and any other document, agreement and instrument entered into by the L/C Issuer and the Borrower (or any Subsidiary) or in favor of the L/C Issuer and relating to such Letter of Credit.

 

“Laws” means, collectively, all international, foreign, Federal, state and local statutes, treaties, rules, guidelines, regulations, ordinances, codes and administrative or judicial precedents or authorities, including the interpretation or administration thereof by any Governmental Authority charged with the enforcement, interpretation or administration thereof, and all applicable administrative orders, directed duties, requests, licenses, authorizations and permits of, and agreements with, any Governmental Authority, in each case whether or not having the force of law.

 

“L/C Advance” means, with respect to each Lender, such Lender’s funding of its participation in any L/C Borrowing in accordance with its Applicable Percentage.

 

“L/C Borrowing” means an extension of credit resulting from a drawing under any Letter of Credit which has not been reimbursed on the date when made or refinanced as a Committed Borrowing.

 

“L/C Credit Extension” means, with respect to any Letter of Credit, the issuance thereof or extension of the expiry date thereof, or the increase of the amount thereof.

 

“L/C Issuer” means Bank of America in its capacity as issuer of Letters of Credit hereunder, or any successor issuer of Letters of Credit hereunder.

 

“L/C Obligations” means, as at any date of determination, the aggregate amount available to be drawn under all outstanding Letters of Credit plus the aggregate of all Unreimbursed Amounts, including all L/C Borrowings.  For purposes of computing the amount available to be drawn under any Letter of Credit, the amount of such Letter of Credit shall be determined in accordance with Section 1.07.  For all purposes of this Agreement, if on any date of determination a Letter of Credit has expired by its terms but any amount may still be drawn thereunder by reason of the operation of Rule 3.14 of the ISP, such Letter of Credit shall be deemed to be “outstanding” in the amount so remaining available to be drawn.

 

“Lender” has the meaning specified in the introductory paragraph hereto and, as the context requires, includes the Swing Line Lender.

 

“Lender Counterparty” means any counterparty under a Swap Contract that was a Lender (or an Affiliate of a Lender) at the time such Swap Contract was entered into.

 

“Lending Office” means, as to any Lender, the office or offices of such Lender described as such in such Lender’s Administrative Questionnaire, or such other office or offices as a Lender may from time to time notify the Borrower and the Administrative Agent.

 

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“Letter of Credit” means any letter of credit issued hereunder.  A Letter of Credit may be a commercial letter of credit or a standby letter of credit.

 

“Letter of Credit Application” means an application and agreement for the issuance or amendment of a Letter of Credit in the form from time to time in use by the L/C Issuer.

 

“Letter of Credit Expiration Date” means the day that is seven days prior to the Maturity Date then in effect (or, if such day is not a Business Day, the next preceding Business Day).

 

“Letter of Credit Fee” has the meaning specified in Section 2.03(i).

 

“Letter of Credit Sublimit” means an amount equal to $50,000,000.  The Letter of Credit Sublimit is part of, and not in addition to, the Aggregate Commitments.

 

“Lien” means, with respect to any asset, (a) any mortgage, deed of trust, lien, pledge, hypothecation, or security interest in, on or of such asset, or any other charge or encumbrance on any such asset to secure Indebtedness or liabilities, but excluding any right to netting or setoff (b) the interest of a vendor or a lessor under any conditional sale agreement, capital lease or title retention agreement (or any financing lease having substantially the same economic effect as any of the foregoing) relating to such asset and (c) in the case of securities, any purchase option, call or similar right of a third party with respect to such securities.

 

“Loan” means an extension of credit by a Lender to the Borrower under Article II in the form of a Committed Loan or a Swing Line Loan.

 

“Loan Documents” means this Agreement, each Note, each Issuer Document, the Fee Letters, and the Guaranty.

 

“Loan Parties” means, collectively, the Borrower and each Guarantor.

 

“Material Adverse Effect” means a material adverse effect on (a) the operations, business, assets or financial condition of the Borrower and the Restricted Subsidiaries taken as a whole; (b) the ability of the Borrower and the Guarantors to perform their obligations, taken as a whole, under this Agreement and the other Loan Documents; or (c) the rights of, or benefits available to, the Administrative Agent, L/C Issuer or Lenders under this Agreement and the other Loan Documents.

 

“Material Contract” means any other contract that is a “material contract” as such term is described in Item 601 of Regulation S-K as issued by the SEC in which the Borrower or any other Loan Party is a party on the one hand, and Pioneer or one of its Affiliates (other than the Borrower and its Subsidiaries) is a party on the other hand, and of which breach, nonperformance, cancellation or failure to renew could reasonably be expected to have a Material Adverse Effect.

 

“Material Indebtedness” means (a) Indebtedness (other than the Loans and Letters of Credit), or (b) obligations in respect of one or more Swap Contracts, in each case under clause (a) or (b) of any one or more of the Borrower and its Restricted Subsidiaries in an aggregate principal amount exceeding the Threshold Amount.  For purposes of determining Material 

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Indebtedness, the “principal amount” of the obligations of the Borrower or any Restricted Subsidiary in respect of any Swap Contracts at any time shall be the Swap Termination Value owed by the Borrower or such Restricted Subsidiary.

 

“Maturity Date” means the later of (a) the date that is the fifth anniversary of the Closing Date and (b) if maturity is extended pursuant to Section 2.14, such extended maturity date as determined pursuant to such Section (it being understood and agreed that any such maturity shall not be deemed extended for any Lender that has not consented to such extension); provided, however, that, in each case, if such date is not a Business Day, the Maturity Date shall be the next preceding Business Day.

 

“Merrill Lynch” means Merrill Lynch, Pierce, Fenner and Smith Incorporated and its successors.

 

“Midstream Assets” means (a) assets used primarily for gathering, transmission, storage, processing or treatment of natural gas, natural gas liquids, carbon dioxide or other Hydrocarbons and (b) Equity Interests of any Person that has no substantial assets other than assets referred to in the foregoing clause (a).

 

“Midstream Assets Report” means a report prepared as of December 31 of each year by the Borrower with respect to the Midstream Assets of the Borrower and the Restricted Subsidiaries, other than Equity Interests, which report shall evaluate the Proved Reserves attributable to the Committed Reserves and shall include (a) a calculation of the net cash flow and the PV of net cash flows projected to be attributable to any anticipated gathering, treatment, transmission, storage and processing of Hydrocarbons and carbon dioxide expected to be produced from the Committed Reserves, and (b) will set forth in reasonable detail, a report of revenues by product, operating expenses and capital expenditures associated with the Midstream Assets, in each case on a year-by-year basis and audited at least as to 80% of the net present value of all such cash flows by Gaffney, Cline & Associates, Ryder Scott Company, Netherland, Sewell & Associates, Inc. or another independent engineering firm selected by the Borrower and reasonably acceptable to the Administrative Agent.

 

“Moody’s” means Moody’s Investors Service, Inc. and any successor thereto.

 

“Multiemployer Plan” means any employee benefit plan of the type described in Section 4001(a)(3) of ERISA, to which the Borrower or any ERISA Affiliate makes or is obligated to make contributions, or during the preceding five plan years, has made or been obligated to make contributions.

 

“Note” means a promissory note made by the Borrower in favor of a Lender evidencing Loans made by such Lender, substantially in the form of Exhibit C.

 

“Non-Recourse Debt” means any Indebtedness of a Subsidiary, in each case in respect of which the holder or holders of such Indebtedness (a) shall have recourse only to, and shall have the right to require the obligations of such Subsidiary to be performed, satisfied, and paid only out of, the assets, revenues and other property of such Subsidiary and/or one or more of its Subsidiaries and/or any other Person (other than the Borrower and/or any Restricted Subsidiary), and (b) shall have no direct or indirect recourse (including by way of guaranty or indemnity) to 

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the Borrower or any Restricted Subsidiary or to any of the assets, revenues or other property of the Borrower or any Restricted Subsidiary, whether for principal, interest, fees, expenses or otherwise.

 

“Obligations” means all advances to, and debts, liabilities, obligations, covenants and duties of, any Loan Party arising under any Loan Document or otherwise with respect to any Loan or Letter of Credit or any Swap Contract executed with a Lender Counterparty, whether direct or indirect (including those acquired by assumption), absolute or contingent, due or to become due, now existing or hereafter arising and including interest and fees that accrue after the commencement by or against any Loan Party or any Affiliate thereof of any proceeding under any Debtor Relief Laws naming such Person as the debtor in such proceeding, regardless of whether such interest and fees are allowed claims in such proceeding. 

 

“Oil and Gas Properties” means Hydrocarbon Interests; the properties now or hereafter pooled or unitized with Hydrocarbon Interests; all presently existing or future unitization, pooling agreements and declarations of pooled units and the units created thereby (including without limitation all units created under orders, regulations and rules of any Governmental Authority having jurisdiction) which may affect all or any portion of the Hydrocarbon Interests; all interests held in royalty trusts whether presently existing or hereafter created; all Hydrocarbons in and under and which may be produced, saved, processed or attributable to the Hydrocarbon Interests, the lands covered thereby and all Hydrocarbons in pipelines, gathering lines, tanks and processing plants and all rents, issues, profits, proceeds, products, revenues and other incomes from or attributable to the Hydrocarbon Interests; all tenements, hereditaments, appurtenances and properties in any way appertaining, belonging, affixed or incidental to the Hydrocarbon Interests, and all rights, titles, interests and estates described or referred to above, including any and all real property, now owned or hereafter acquired, used or held for use in connection with the operating, working or development of any of such Hydrocarbon Interests or property and including any and all surface leases, rights-of-way, easements and servitudes together with all additions, substitutions, replacements, accessions and attachments to any and all of the foregoing; all oil, gas and mineral leasehold and fee interests, all overriding royalty interests, mineral interests, royalty interests, net profits interests, net revenue interests, oil payments, production payments, carried interests and any and all other interests in Hydrocarbons; in each case whether now owned or hereafter acquired directly or indirectly.

 

“Operating Company” means Pioneer Southwest Energy Partners USA LLC, a Texas limited liability company, and its permitted successors and assigns.

 

“Organization Documents” means, (a) with respect to any corporation, the certificate or articles of incorporation and the bylaws (or equivalent or comparable constitutive documents with respect to any non-U.S. jurisdiction); (b) with respect to any limited liability company, the certificate or articles of formation or organization and operating agreement; and (c) with respect to any partnership, joint venture, trust or other form of business entity, the partnership, joint venture or other applicable agreement of formation or organization and any agreement, instrument, filing or notice with respect thereto filed in connection with its formation or organization with the applicable Governmental Authority in the jurisdiction of its formation or organization and, if applicable, any certificate or articles of formation or organization of such entity.

 

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“Other Taxes” means all present or future stamp or documentary taxes or any other excise or property taxes, charges or similar levies arising from any payment made hereunder or under any other Loan Document or from the execution, delivery or enforcement of, or otherwise with respect to, this Agreement or any other Loan Document.

 

“Outstanding Amount” means (i) with respect to Committed Loans and Swing Line Loans on any date, the aggregate outstanding principal amount thereof after giving effect to any borrowings and prepayments or repayments of Committed Loans and Swing Line Loans, as the case may be, occurring on such date; and (ii) with respect to any L/C Obligations on any date, the amount of such L/C Obligations on such date after giving effect to any L/C Credit Extension occurring on such date and any other changes in the aggregate amount of the L/C Obligations as of such date, including as a result of any reimbursements by the Borrower of Unreimbursed Amounts.

 

“Participant” has the meaning specified in Section 10.06(d).

 

“Partnership Agreement” means that certain First Amended and Restated Agreement of Pioneer Southwest Energy Partners L.P., dated as of May 6, 2008, as may be amended, restated, or otherwise modified from time to time in accordance with this Agreement.

 

“PBGC” means the Pension Benefit Guaranty Corporation referred to and defined in ERISA and any successor entity performing similar functions.

 

“Pension Plan” means any “employee pension benefit plan” (as such term is defined in Section 3(2) of ERISA), other than a Multiemployer Plan, that is subject to Title IV of ERISA and is sponsored or maintained by the Borrower or any ERISA Affiliate or to which the Borrower or any ERISA Affiliate contributes or has an obligation to contribute, or in the case of a multiple employer or other plan described in Section 4064(a) of ERISA, has made contributions at any time during the immediately preceding five plan years.

 

 “Permitted Encumbrances” means:

 

(a) Liens imposed by law for taxes, assessments, or other governmental charges or levies that are not yet delinquent or are being contested in compliance with Section 6.05;

 

(b) carriers’, warehousemen’s, mechanics’, materialmen’s, repairmen’s, landlords, vendors, workmen, operators, and other like Liens arising in the ordinary course of business or incident to the exploration, development, operation, processing and maintenance of Hydrocarbons and related facilities and assets and securing obligations that are not overdue by more than 90 days or are being contested in compliance with Section 6.05;

 

(c) pledges and deposits made in the ordinary course of business in compliance with workers’ compensation, unemployment insurance, and other social security laws or regulations;

 

(d) deposits to secure the performance of bids, tenders, trade contracts, leases, statutory obligations, surety and appeal bonds, performance bonds, and other obligations of a like nature, in each case in the ordinary course of business;

 

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(e) judgment liens in respect of judgments that do not constitute an Event of Default under Section 8.01(h);

 

(f) easements, zoning restrictions, rights-of-way, servitudes, permits, conditions, exceptions, reservations, and similar encumbrances on real property imposed by law or arising in the ordinary course of business that do not secure any Indebtedness and do not materially interfere with the ordinary conduct of business of the Borrower or any Restricted Subsidiary;

 

(g) legal or equitable encumbrances deemed to exist by reason of negative pledges such as in Section 7.02 of this Agreement or the existence of any litigation or other legal proceeding and any related lis pendens filing (excluding any attachment prior to judgment, judgment lien or attachment lien in aid of execution on a judgment);

 

(h) rights of a common owner of any interest in property held by Borrower or any Restricted Subsidiary as a common owner;

 

(i) farmout, carried working interest, joint operating, unitization, royalty, overriding royalty, sales, area of mutual interest, division order, joint venture, partnership and similar agreements relating to the exploration or development of, or production from, oil and gas properties incurred in the ordinary course of business;

 

(j) Liens arising pursuant to Section 9.343 of the Texas Uniform Commercial Code or other similar statutory provisions of other states with respect to production purchased from others;

 

(k) any defects, irregularities, or deficiencies in title to easements, rights-of-way, or other properties which do not in the aggregate have a Material Adverse Effect;

 

(l) Liens on the stock or other ownership interest of or in any Unrestricted Subsidiary, provided that there is no recourse to the Borrower or any Restricted Subsidiary other than recourse to such stock or other ownership interest and proceeds thereof;

 

(m) Liens resulting from the deposit of funds or evidences of Indebtedness in trust for the purpose of defeasing Indebtedness of the Borrower or any Restricted Subsidiary;

 

(n) Liens arising under customary letter of credit reimbursement agreements and customary deposit account agreement, and similar agreements entered into in the ordinary course of business with respect to instruments or money in the possession of the other party thereto in the ordinary course of business; and

 

(o) Liens in renewal or extension of any of the foregoing permitted Liens, so long as limited to the property or assets encumbered and the amounts of indebtedness secured immediately prior to such renewal or extension is not increased.

 

“Person” means any natural person, corporation, limited liability company, trust, joint venture, association, company, partnership, Governmental Authority or other entity.

 

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“Pioneer” means Pioneer Natural Resources Company, a Delaware corporation, and for purposes other than clause (e) of the definition of the term “Change of Control”, its successor or the surviving entity resulting from a merger, consolidation or similar reorganization or restructuring transaction, or a parent or subsidiary thereof, as long as such successor or surviving entity does not give rise to a Change of Control under clause (e) of the definition of the term “Change of Control”.

 

“Pioneer Credit Agreement” means that certain Second Amended and Restated 5-Year Revolving Credit Agreement, dated as of March 31, 2011, among Pioneer, JPMorgan Chase Bank, N.A. as administrative agent, and the other parties thereto, as amended, restated or otherwise modified from time to time.

 

 “Plan” means any “employee benefit plan” (as such term is defined in Section 3(3) of ERISA) established by the Borrower or, with respect to any such plan that is subject to Section 412 of the Code or Title IV of ERISA, any ERISA Affiliate.

 

“Platform” has the meaning specified in Section 6.02(g).

 

“Proved Reserves” means the estimated quantities of crude oil, condensate, natural gas and natural gas liquids that adequate geological and engineering data demonstrate with reasonable certainty to be recoverable in future years from proved reservoirs under existing economic and operating conditions (i.e., prices and costs as of the date the estimate is made).

 

“PV” means, as of any date of calculation, the calculation of the net present value of projected future cash flows from (a) Proved Reserves based upon the most recently delivered Reserve Report (using the discount rate and the customary price deck of the Administrative Agent as of the date of calculation (which such discount rate as of the Closing Date is 9%) and giving effect to the Borrower’s hedging arrangements with Qualified Counterparties and long-term contracts) and (b) Midstream Assets that are attributable to the anticipated gathering, treatment, transmission, storage and processing of Hydrocarbons and carbon dioxide expected to be produced from Committed Reserves during the remaining expected economic lives of such reserves, based upon the most recently delivered Midstream Assets Report (using the discount rate of the Administrative Agent as of date of calculation (which such discount rate as of the Closing Date is 9%) and giving effect to the Borrower’s hedging arrangements with Qualified Counterparties and Services Contracts; provided, however, that for any Services Contracts in which the sales price is based upon fluctuating market prices, calculations will be based on the customary price deck of the Administrative Agent as of the date of such calculation, with appropriate adjustments for product and location differentials).  For purposes of calculating the PV under clause (a), a maximum of thirty percent (30%) of the PV value will be included from Proved Reserves that are not proved developed producing reserves.  If during the period between the December 31 effective dates of the Reserve Reports and Midstream Assets Reports, the aggregate fair market value, in the reasonable opinion of the Borrower, of Oil and Gas Properties and Midstream Assets disposed of or purchased by the Borrower and the Restricted Subsidiaries shall exceed the Threshold Amount, then the PV for such period shall be reduced or increased, as the case may be, at the end of each fiscal quarter occurring during such period, by an amount equal to the value assigned such Oil and Gas Properties or Midstream Assets, as applicable, in the most recent calculation of the PV for such period (or if no value was assigned, by an amount 

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agreed to by the Borrower and the Administrative Agent).  PV shall reflect the deferred revenue with respect to volumetric production payments included in Consolidated Indebtedness, at a value that is equal to the amount of deferred revenues so included in Consolidated Indebtedness.

 

“PV to Consolidated Indebtedness Compliance Certificate” means a certificate of a Responsible Officer of the General Partner setting forth reasonably detailed calculations demonstrating compliance with Section 7.04(b) and delivered in accordance with Section 6.02(g).

 

“Public Lender” has the meaning specified in Section 6.02(g).

 

“Qualified Counterparty” means (a) any Lender Counterparty or (b) any other Person, other than the Borrower and the Restricted Subsidiaries, who, at the time a Swap Contract is executed with the Borrower or a Restricted Subsidiary has, or whose guarantor of the obligations of such Person has, a senior long-term unsecured debt obligations rating of BBB- or better issued by S&P and Baa3 or better by Moody’s, in each case with a stable outlook.

 

“Register” has the meaning specified in Section 10.06(c).

 

 “Related Parties” means, with respect to any Person, such Person’s Affiliates and the partners, directors, officers, employees, agents and advisors of such Person and of such Person’s Affiliates.

 

“Reportable Event” means any of the events set forth in Section 4043(c) of ERISA, other than events for which the 30 day notice period has been waived.

 

“Request for Credit Extension” means (a) with respect to a Borrowing, conversion or continuation of Committed Loans, a Committed Loan Notice, (b) with respect to an L/C Credit Extension, a Letter of Credit Application, and (c) with respect to a Swing Line Loan, a Swing Line Loan Notice.

 

“Required Lenders” means, as of any date of determination, Lenders having more than 50% of the Aggregate Commitments or, if the commitment of each Lender to make Loans and the obligation of the L/C Issuer to make L/C Credit Extensions have been terminated pursuant to Section 8.02, Lenders holding in the aggregate more than 50% of the Total Outstandings (with the aggregate amount of each Lender’s risk participation and funded participation in L/C Obligations and Swing Line Loans being deemed “held” by such Lender for purposes of this definition); provided that the Commitment of, and the portion of the Total Outstandings held or deemed held by, any Defaulting Lender shall be excluded for purposes of making a determination of Required Lenders.

 

“Reserve Report” means the report prepared as of December 31 of each year by the Borrower with respect to the Oil and Gas Properties of the Borrower and the Restricted Subsidiaries and audited at least as to 80% of the net present value of all such Proved Reserves by Gaffney, Cline & Associates, Ryder Scott Company, Netherland, Sewell & Associates, Inc. or another independent engineering firm selected by the Borrower and reasonably acceptable to the Administrative Agent.

 

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“Responsible Officer” means the chief executive officer, president, chief financial officer, chief accounting officer, treasurer, assistant treasurer or controller of a Loan Party or, in the case of the Borrower, of the General Partner (or if a Loan Party has no officers, the corresponding officers of such Loan Party’s member, manager or general partner, as applicable) and, solely for purposes of notices given pursuant to Article II, any other officer or employee of the applicable Loan Party so designated by any of the foregoing officers in a written notice to the Administrative Agent.  Any document delivered hereunder that is signed by a Responsible Officer of a Loan Party shall be conclusively presumed to have been authorized by all necessary corporate, partnership and/or other action on the part of such Loan Party and such Responsible Officer shall be conclusively presumed to have acted on behalf of such Loan Party.

 

“Restricted Payment” means any dividend or other distribution (whether in cash, securities or other property) with respect to any capital stock or other Equity Interest of the Borrower or any Subsidiary, or any payment (whether in cash, securities or other property), including any sinking fund or similar deposit, on account of the purchase, redemption, retirement, acquisition, cancellation or termination of any such capital stock or other Equity Interest, or on account of any return of capital to the Borrower’s stockholders, partners or members (or the equivalent Person thereof).

 

“Restricted Subsidiary” means any Subsidiary that is not an Unrestricted Subsidiary.

 

“S&P” means Standard & Poor’s Ratings Services, a division of The McGraw-Hill Companies, Inc. and any successor thereto.

 

“SEC” means the Securities and Exchange Commission, or any Governmental Authority succeeding to any of its principal functions.

 

 “Services Contract” means all contracts, agreements or arrangements for the gathering, transporting, treatment, storage or processing of Hydrocarbons by, through or in connection with a processing plant, pipeline or other Midstream Asset owned by the Borrower and its Restricted Subsidiaries.

 

“Specified Acquisition” means an Acquisition (or series of related Acquisitions) permitted hereunder occurring on or after the Closing Date of any Person, property, business or asset by the Borrower or any Restricted Subsidiary (other than an Acquisition from the Borrower or a Restricted Subsidiary), to the extent not subsequently sold, transferred or otherwise Disposed by the Borrower or such Restricted Subsidiary, for an aggregate purchase price of not less than $25,000,000.

 

“Subsidiary” of a Person means a corporation, partnership, joint venture, limited liability company or other business entity of which a majority of the shares of securities or other interests having ordinary voting power for the election of directors or other governing body (other than securities or interests having such power only by reason of the happening of a contingency) are at the time beneficially owned, or the management of which is otherwise controlled, directly, or indirectly through one or more intermediaries, or both, by such Person.  Unless otherwise specified, all references herein to a “Subsidiary” or to “Subsidiaries” shall refer to a Subsidiary or Subsidiaries of the Borrower.

 

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“Swap Contract” means (a) any and all rate swap transactions, basis swaps, credit derivative transactions, forward rate transactions, commodity swaps, commodity options, forward commodity contracts, equity or equity index swaps or options, bond or bond price or bond index swaps or options or forward bond or forward bond price or forward bond index transactions, interest rate options, forward foreign exchange transactions, cap transactions, floor transactions, collar transactions, currency swap transactions, cross-currency rate swap transactions, currency options, spot contracts, or any other similar transactions or any combination of any of the foregoing (including any options to enter into any of the foregoing), whether or not any such transaction is governed by or subject to any master agreement, and (b) any and all transactions of any kind, and the related confirmations, which are subject to the terms and conditions of, or governed by, any form of master agreement published by the International Swaps and Derivatives Association, Inc., any International Foreign Exchange Master Agreement, or any other master agreement (any such master agreement, together with any related schedules, a “Master Agreement”), including any such obligations or liabilities under any Master Agreement.

 

“Swap Termination Value” means, in respect of any one or more Swap Contracts, after taking into account the effect of any legally enforceable netting agreement relating to such Swap Contracts, (a) for any date on or after the date such Swap Contracts have been closed out and termination value(s) determined in accordance therewith, such termination value(s), and (b) for any date prior to the date referenced in clause (a), the amount(s) determined as the mark-to-market value(s) for such Swap Contracts, as determined based upon one or more mid-market or other readily available quotations provided by any recognized dealer in such Swap Contracts (which may include a Lender or any Affiliate of a Lender).

 

“Swing Line Borrowing” means a borrowing of a Swing Line Loan pursuant to Section 2.04.

 

“Swing Line Lender” means Bank of America in its capacity as provider of Swing Line Loans, or any successor swing line lender hereunder.

 

“Swing Line Loan” has the meaning specified in Section 2.04(a).

 

“Swing Line Loan Notice” means a notice of a Swing Line Borrowing pursuant to Section 2.04(b), which, if in writing, shall be substantially in the form of Exhibit B.

 

“Swing Line Sublimit” means an amount equal to the lesser of (a) $50,000,000 and (b) the Aggregate Commitments.  The Swing Line Sublimit is part of, and not in addition to, the Aggregate Commitments.

 

“Syndication Agent” means Wells Fargo Bank, N.A. in its capacity as syndication agent under any of the Loan Documents, or any successor syndication agent.

 

“Synthetic Lease Obligation” of any Person means the monetary obligations of such Person under (a) a so-called synthetic, off-balance sheet or tax retention lease, or (b) an agreement for the use or possession of property creating obligations that do not appear on the balance sheet of such Person but which, upon the insolvency or bankruptcy of such Person, would be characterized as the indebtedness of such Person (without regard to accounting

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treatment), and the amount of such obligations shall be the capitalized amount of the remaining lease payments under the relevant lease that would appear on the balance sheet of such Person determined in accordance with GAAP if such lease were accounted for as a capital lease.

 

“Taxes” means all present or future taxes, levies, imposts, duties, deductions, withholdings (including backup withholdings), assessments, fees or other charges imposed by any Governmental Authority, including any interest, additions to tax or penalties applicable thereto.

 

“Threshold Amount” means $30,000,000.

 

“Total Outstandings” means the aggregate Outstanding Amount of all Loans and all L/C Obligations.

 

“Type” means, with respect to a Committed Loan, its character as a Base Rate Loan or a Eurodollar Rate Loan.

 

 “Unfunded Pension Liability” means the excess of a Pension Plan’s benefit liabilities under Section 4001(a)(16) of ERISA, over the current value of that Pension Plan’s assets, determined in accordance with the assumptions used for funding the Pension Plan pursuant to Section 412 of the Code for the applicable plan year.

 

“United States” and “U.S.” mean the United States of America.

 

“Unreimbursed Amount” has the meaning specified in Section 2.03(c)(i).

 

“Unrestricted Subsidiary” means any Subsidiary which the Borrower has designated in writing to the Administrative Agent to be an Unrestricted Subsidiary pursuant to Section 6.12 and which the Borrower has not designated to be a Restricted Subsidiary pursuant to Section 6.12 and any Subsidiary of an Unrestricted Subsidiary.

 

“Wells Fargo Securities” means Wells Fargo Securities, LLC, and its successors.

 

1.02 

 

1.03 Other Interpretive Provisions.  With reference to this Agreement and each other Loan Document, unless otherwise specified herein or in such other Loan Document:

 

(a) The definitions of terms herein shall apply equally to the singular and plural forms of the terms defined.  Whenever the context may require, any pronoun shall include the corresponding masculine, feminine and neuter forms.  The words “include,” “includes” and “including” shall be deemed to be followed by the phrase “without limitation.”  The word “will” shall be construed to have the same meaning and effect as the word “shall.”  Unless the context requires otherwise, (i) any definition of or reference to any agreement, instrument or other document (including any Organization Document) shall be construed as referring to such agreement, instrument or other document as from time to time amended, supplemented or otherwise modified (subject to any restrictions on such amendments, supplements or modifications set forth herein or in any other Loan Document), (ii) any reference herein to any Person shall be construed to include such Person’s successors and assigns, (iii) the words “herein,” “hereof” and “hereunder,” and words of similar import when used in any Loan 

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Document, shall be construed to refer to such Loan Document in its entirety and not to any particular provision thereof, (iv) all references in a Loan Document to Articles, Sections, Exhibits and Schedules shall be construed to refer to Articles and Sections of, and Exhibits and Schedules to, the Loan Document in which such references appear, (v) any reference to any law shall include all statutory and regulatory provisions consolidating, amending, replacing or interpreting such law and any reference to any law or regulation shall, unless otherwise specified, refer to such law or regulation as amended, modified or supplemented from time to time, and (vi) the words “asset” and “property” shall be construed to have the same meaning and effect and to refer to any and all tangible and intangible assets and properties, including cash, securities, accounts and contract rights.

 

(b) In the computation of periods of time from a specified date to a later specified date, the word “from” means “from and including;” the words “to” and “until” each mean “to but excluding;” and the word “through” means “to and including.”

 

(c) Section headings herein and in the other Loan Documents are included for convenience of reference only and shall not affect the interpretation of this Agreement or any other Loan Document.

 

1.04 Accounting Terms.

 

(a) Generally.  All accounting terms not specifically or completely defined herein shall be construed in conformity with, and all financial data (including financial ratios and other financial calculations) required to be submitted pursuant to this Agreement shall be prepared in conformity with, GAAP applied on a consistent basis, as in effect from time to time, applied in a manner consistent with that used in preparing the Audited Financial Statements, except as otherwise specifically prescribed herein.

 

(b) Changes in GAAP.  If at any time any change in GAAP would affect the computation of any financial ratio or requirement set forth in any Loan Document, and either the Borrower or the Required Lenders shall so request, the Administrative Agent, the Lenders and the Borrower shall negotiate in good faith to amend such ratio or requirement to preserve the original intent thereof in light of such change in GAAP (subject to the approval of the Required Lenders); provided that, until so amended, (i) such ratio or requirement shall continue to be computed in accordance with GAAP prior to such change therein and (ii) the Borrower shall provide to the Administrative Agent and the Lenders financial statements and other documents required under this Agreement or as reasonably requested hereunder setting forth a reconciliation between calculations of such ratio or requirement made before and after giving effect to such change in GAAP.

 

1.05 Rounding.  Any financial ratios required to be maintained by the Borrower pursuant to this Agreement shall be calculated by dividing the appropriate component by the other component, carrying the result to one place more than the number of places by which such ratio is expressed herein and rounding the result up or down to the nearest number (with a rounding-up if there is no nearest number).

 

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1.06 Times of Day.  Unless otherwise specified, all references herein to times of day shall be references to Eastern time (daylight or standard, as applicable).

 

1.07 Letter of Credit Amounts.  Unless otherwise specified herein, the amount of a Letter of Credit at any time shall be deemed to be the stated amount of such Letter of Credit in effect at such time; provided, however, that with respect to any Letter of Credit that, by its terms or the terms of any Issuer Document related thereto, provides for one or more automatic increases in the stated amount thereof, the amount of such Letter of Credit shall be deemed to be the maximum stated amount of such Letter of Credit after giving effect to all such increases, whether or not such maximum stated amount is in effect at such time.

 

ARTICLE II.                                

 

THE COMMITMENTS AND CREDIT EXTENSIONS

 

2.01 Committed Loans.  Subject to the terms and conditions set forth herein, each Lender severally agrees to make loans (each such loan, a “Committed Loan”) to the Borrower from time to time, on any Business Day during the Availability Period, in an aggregate amount not to exceed at any time outstanding the amount of such Lender’s Commitment; provided, however, that after giving effect to any Committed Borrowing, (i) the Total Outstandings shall not exceed the Aggregate Commitments, and (ii) the aggregate Outstanding Amount of the Committed Loans of any Lender, plus such Lender’s Applicable Percentage of the Outstanding Amount of all L/C Obligations, plus such Lender’s Applicable Percentage of the Outstanding Amount of all Swing Line Loans shall not exceed such Lender’s Commitment.  Within the limits of each Lender’s Commitment, and subject to the other terms and conditions hereof, the Borrower may borrow under this Section 2.01, prepay under Section 2.05, and reborrow under this Section 2.01.  Committed Loans may be Base Rate Loans or Eurodollar Rate Loans, as further provided herein.

 

2.02 Borrowings, Conversions and Continuations of Committed Loans.  (a)  Each Committed Borrowing, each conversion of Committed Loans from one Type to the other, and each continuation of Eurodollar Rate Loans shall be made upon the Borrower’s irrevocable notice to the Administrative Agent, which may be given by telephone.  Each such notice must be received by the Administrative Agent not later than 12:00 noon (i) three Business Days prior to the requested date of any Borrowing of, conversion to or continuation of Eurodollar Rate Loans or of any conversion of Eurodollar Rate Loans to Base Rate Committed Loans, and (ii) on the requested date of any Borrowing of Base Rate Committed Loans.  Each telephonic notice by the Borrower pursuant to this Section 2.02(a) must be confirmed promptly by delivery to the Administrative Agent of a written Committed Loan Notice, appropriately completed and signed by a Responsible Officer of the Borrower.  Each Borrowing of, conversion to or continuation of Eurodollar Rate Loans shall be in a principal amount of $5,000,000 or a whole multiple of $1,000,000 in excess thereof.  Except as provided in Sections 2.03(c) and 2.04(c), each Borrowing of or conversion to Base Rate Committed Loans shall be in a principal amount of $5,000,000 or a whole multiple of $1,000,000 in excess thereof.  Each Committed Loan Notice (whether telephonic or written) shall specify (i) whether the Borrower is requesting a Committed Borrowing, a conversion of Committed Loans from one Type to the other, or a continuation of Eurodollar Rate Loans, (ii) the requested date of the Borrowing, conversion or continuation, as the case may be (which shall be a Business Day), (iii) the principal amount of Committed Loans 

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to be borrowed, converted or continued, (iv) the Type of Committed Loans to be borrowed or to which existing Committed Loans are to be converted, and (v) if applicable, the duration of the Interest Period with respect thereto.  If the Borrower fails to specify a Type of Committed Loan in a Committed Loan Notice or if the Borrower fails to give a timely notice requesting a conversion or continuation, then the applicable Committed Loans shall be made as, or converted to, Base Rate Loans.  Any such automatic conversion to Base Rate Loans shall be effective as of the last day of the Interest Period then in effect with respect to the applicable Eurodollar Rate Loans.  If the Borrower requests a Borrowing of, conversion to, or continuation of Eurodollar Rate Loans in any such Committed Loan Notice, but fails to specify an Interest Period, it will be deemed to have specified an Interest Period of one month.

 

(b) Following receipt of a Committed Loan Notice, the Administrative Agent shall promptly notify each Lender of the amount of its Applicable Percentage of the applicable Committed Loans, and if no timely notice of a conversion or continuation is provided by the Borrower, the Administrative Agent shall notify each Lender of the details of any automatic conversion to Base Rate Loans described in the preceding subsection.  In the case of a Committed Borrowing, each Lender shall make the amount of its Committed Loan available to the Administrative Agent in immediately available funds at the Administrative Agent’s Office not later than 2:00 p.m. on the Business Day specified in the applicable Committed Loan Notice.  Upon satisfaction of the applicable conditions set forth in Section 4.02, the Administrative Agent shall make all funds so received available to the Borrower in like funds as received by the Administrative Agent either by (i) crediting the account of the Borrower on the books of Bank of America with the amount of such funds or (ii) wire transfer of such funds, in each case in accordance with instructions provided to (and reasonably acceptable to) the Administrative Agent by the Borrower; provided, however, that if, on the date the Committed Loan Notice with respect to such Borrowing is given by the Borrower, there are L/C Borrowings outstanding, then the proceeds of such Borrowing, first, shall be applied to the payment in full of any such L/C Borrowings, and second, shall be made available to the Borrower as provided above.

 

(c) Except as otherwise provided herein, a Eurodollar Rate Loan may be continued or converted only on the last day of an Interest Period for such Eurodollar Rate Loan.  During the existence of a Default, no Loans may be requested as, converted to or continued as Eurodollar Rate Loans without the consent of the Required Lenders.

 

(d) The Administrative Agent shall promptly notify the Borrower and the Lenders of the interest rate applicable to any Interest Period for Eurodollar Rate Loans upon determination of such interest rate.  At any time that Base Rate Loans are outstanding, the Administrative Agent shall notify the Borrower and the Lenders of any change in Bank of America’s prime rate used in determining the Base Rate promptly following the public announcement of such change.

 

(e) After giving effect to all Committed Borrowings, all conversions of Committed Loans from one Type to the other, and all continuations of Committed Loans as the same Type, there shall not be more than fifteen Interest Periods in effect with respect to Committed Loans.

 

2.03 Letters of Credit.

 

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(a) The Letter of Credit Commitment.

 

(i) Subject to the terms and conditions set forth herein, (A) the L/C Issuer agrees, in reliance upon the agreements of the Lenders set forth in this Section 2.03, (1) from time to time on any Business Day during the period from the Closing Date until the Letter of Credit Expiration Date, to issue Letters of Credit for the account of the Borrower or its Restricted Subsidiaries, and to amend or extend Letters of Credit previously issued by it, in accordance with subsection (b) below, and (2) to honor drawings under the Letters of Credit; and (B) the Lenders severally agree to participate in Letters of Credit issued for the account of the Borrower or its Restricted Subsidiaries and any drawings thereunder; provided that after giving effect to any L/C Credit Extension with respect to any Letter of Credit, (x) the Total Outstandings shall not exceed the Aggregate Commitments, (y) the aggregate Outstanding Amount of the Committed Loans of any Lender, plus such Lender’s Applicable Percentage of the Outstanding Amount of all L/C Obligations, plus such Lender’s Applicable Percentage of the Outstanding Amount of all Swing Line Loans shall not exceed such Lender’s Commitment, and (z) the Outstanding Amount of the L/C Obligations shall not exceed the Letter of Credit Sublimit.  Each request by the Borrower for the issuance or amendment of a Letter of Credit shall be deemed to be a representation by the Borrower that the L/C Credit Extension so requested complies with the conditions set forth in the proviso to the preceding sentence.  Within the foregoing limits, and subject to the terms and conditions hereof, the Borrower’s ability to obtain Letters of Credit shall be fully revolving, and accordingly the Borrower may, during the foregoing period, obtain Letters of Credit to replace Letters of Credit that have expired or that have been drawn upon and reimbursed.

 

(ii) The L/C Issuer shall not issue any Letter of Credit, if:

 

(A) subject to Section 2.03(b)(iii), the expiry date of such requested Letter of Credit would occur more than twelve months after the date of issuance or last extension, unless the Required Lenders have approved such expiry date; or

 

(B) the expiry date of such requested Letter of Credit would occur after the Letter of Credit Expiration Date, unless all the Lenders have approved such expiry date.

 

(iii) The L/C Issuer shall not be under any obligation to issue any Letter of Credit if:

 

(A) any order, judgment or decree of any Governmental Authority or arbitrator shall by its terms purport to enjoin or restrain the L/C Issuer from issuing such Letter of Credit, or any Law applicable to the L/C Issuer or any request or directive (whether or not having the force of law) from any Governmental Authority with jurisdiction over the L/C Issuer shall prohibit, or request that the L/C Issuer refrain from, the issuance of letters of credit generally or such Letter of Credit in particular or shall impose upon the L/C Issuer with respect to such Letter of Credit any restriction, reserve or capital requirement (for 

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which the L/C Issuer is not otherwise compensated hereunder) not in effect on the Closing Date, or shall impose upon the L/C Issuer any unreimbursed loss, cost or expense which was not applicable on the Closing Date and which the L/C Issuer in good faith deems material to it;

 

(B) the issuance of such Letter of Credit would violate one or more policies of the L/C Issuer applicable to letters of credit generally;

 

(C) except as otherwise agreed by the Administrative Agent and the L/C Issuer, such Letter of Credit is in an initial stated amount less than $100,000;

 

(D) such Letter of Credit is to be denominated in a currency other than Dollars;

 

(E) such Letter of Credit contains any provisions for automatic reinstatement of the stated amount after any drawing thereunder; or

 

(F) a default of any Lender’s obligations to fund under Section 2.03(c) exists or any Lender is at such time a Defaulting Lender hereunder, unless the L/C Issuer has entered into satisfactory arrangements with the Borrower or such Lender to eliminate the L/C Issuer’s risk with respect to such Lender.

 

(iv) The L/C Issuer shall not amend any Letter of Credit if the L/C Issuer would not be permitted at such time to issue such Letter of Credit in its amended form under the terms hereof.

 

(v) The L/C Issuer shall be under no obligation to amend any Letter of Credit if (A) the L/C Issuer would have no obligation at such time to issue such Letter of Credit in its amended form under the terms hereof, or (B) the beneficiary of such Letter of Credit does not accept the proposed amendment to such Letter of Credit.

 

(vi) The L/C Issuer shall act on behalf of the Lenders with respect to any Letters of Credit issued by it and the documents associated therewith, and the L/C Issuer shall have all of the benefits and immunities (A) provided to the Administrative Agent in Article IX with respect to any acts taken or omissions suffered by the L/C Issuer in connection with Letters of Credit issued by it or proposed to be issued by it and Issuer Documents pertaining to such Letters of Credit as fully as if the term “Administrative Agent” as used in Article IX included the L/C Issuer with respect to such acts or omissions, and (B) as additionally provided herein with respect to the L/C Issuer.

 

(b) Procedures for Issuance and Amendment of Letters of Credit; Auto-Extension Letters of Credit.

 

(i) Each Letter of Credit shall be issued or amended, as the case may be, upon the request of the Borrower delivered to the L/C Issuer (with a copy to the Administrative Agent) in the form of a Letter of Credit Application, appropriately completed and signed by a Responsible Officer of the Borrower.  Such Letter of Credit Application must be received by the L/C Issuer and the Administrative Agent not later than 11:00 a.m. at least 

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two Business Days (or such later date and time as the Administrative Agent and the L/C Issuer may agree in a particular instance in their sole discretion) prior to the proposed issuance date or date of amendment, as the case may be.  In the case of a request for an initial issuance of a Letter of Credit, such Letter of Credit Application shall specify in form and detail reasonably satisfactory to the L/C Issuer: (A) the proposed issuance date of the requested Letter of Credit (which shall be a Business Day); (B) the amount thereof; (C) the expiry date thereof; (D) the name and address of the beneficiary thereof; (E) the documents to be presented by such beneficiary in case of any drawing thereunder; (F) the full text of any certificate to be presented by such beneficiary in case of any drawing thereunder; (G) whether the requested Letter of Credit is to be a commercial Letter of Credit or a standby Letter of Credit and the purpose and nature of the requested Letter of Credit; and (H) such other matters as the L/C Issuer may require.  In the case of a request for an amendment of any outstanding Letter of Credit, such Letter of Credit Application shall specify in form and detail satisfactory to the L/C Issuer (A) the Letter of Credit to be amended; (B) the proposed date of amendment thereof (which shall be a Business Day); (C) the nature of the proposed amendment; and (D) such other matters as the L/C Issuer may require.  Additionally, the Borrower shall furnish to the L/C Issuer and the Administrative Agent such other documents and information pertaining to such requested Letter of Credit issuance or amendment, including any Issuer Documents, as the L/C Issuer or the Administrative Agent may reasonably require.

 

(ii) Promptly after receipt of any Letter of Credit Application, the L/C Issuer will confirm with the Administrative Agent (by telephone or in writing) that the Administrative Agent has received a copy of such Letter of Credit Application from the Borrower and, if not, the L/C Issuer will provide the Administrative Agent with a copy thereof.  Unless the L/C Issuer has received written notice from any Lender, the Administrative Agent or any Loan Party, at least one Business Day prior to the requested date of issuance or amendment of the applicable Letter of Credit, that one or more applicable conditions contained in Article IV shall not then be satisfied, then, subject to the terms and conditions hereof, the L/C Issuer shall, on the requested date, issue a Letter of Credit for the account of the Borrower (or the applicable Restricted Subsidiary) or enter into the applicable amendment, as the case may be, in each case in accordance with the L/C Issuer’s usual and customary business practices.  Immediately upon the issuance of each Letter of Credit, each Lender shall be deemed to, and hereby irrevocably and unconditionally agrees to, purchase from the L/C Issuer a risk participation in such Letter of Credit in an amount equal to the product of such Lender’s Applicable Percentage times the amount of such Letter of Credit.

 

(iii) If the Borrower so requests in any applicable Letter of Credit Application, the L/C Issuer may, in its sole and absolute discretion, agree to issue a Letter of Credit that has automatic extension provisions (each, an “Auto-Extension Letter of Credit”); provided that any such Auto-Extension Letter of Credit must permit the L/C Issuer to prevent any such extension at least once in each twelve-month period (commencing with the date of issuance of such Letter of Credit) by giving prior notice to the beneficiary thereof not later than a day (the “Non-Extension Notice Date”) in each such twelve-month period to be agreed upon at the time such Letter of Credit is issued.  Unless otherwise directed by the L/C Issuer, the Borrower shall not be required to make a 

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specific request to the L/C Issuer for any such extension.  Once an Auto-Extension Letter of Credit has been issued, the Lenders shall be deemed to have authorized (but may not require) the L/C Issuer to permit the extension of such Letter of Credit at any time to an expiry date not later than the Letter of Credit Expiration Date; provided, however, that the L/C Issuer shall not permit any such extension if (A) the L/C Issuer has determined that it would not be permitted, or would have no obligation, at such time to issue such Letter of Credit in its revised form (as extended) under the terms hereof (by reason of the provisions of clause (ii) or (iii) of Section 2.03(a) or otherwise), or (B) it has received notice (which may be by telephone or in writing) on or before the day that is seven Business Days before the Non-Extension Notice Date (1) from the Administrative Agent that the Required Lenders have elected not to permit such extension or (2) from the Administrative Agent, any Lender or the Borrower that one or more of the applicable conditions specified in Section 4.02 is not then satisfied, and in each such case directing the L/C Issuer not to permit such extension.

 

(iv) Promptly after its delivery of any Letter of Credit or any amendment to a Letter of Credit to an advising bank with respect thereto or to the beneficiary thereof, the L/C Issuer will also deliver to the Borrower and the Administrative Agent a true and complete copy of such Letter of Credit or amendment.

 

(c) Drawings and Reimbursements; Funding of Participations.

 

(i) Upon receipt from the beneficiary of any Letter of Credit of any notice of a drawing under such Letter of Credit, the L/C Issuer shall notify the Borrower and the Administrative Agent thereof.  Not later than 12:00 noon on the date of any payment by the L/C Issuer under a Letter of Credit (each such date, an “Honor Date”), the Borrower shall reimburse the L/C Issuer through the Administrative Agent in an amount equal to the amount of such drawing.  If the Borrower fails to so reimburse the L/C Issuer by such time, the Administrative Agent shall promptly notify each Lender of the Honor Date, the amount of the unreimbursed drawing (the “Unreimbursed Amount”), and the amount of such Lender’s Applicable Percentage thereof.  In such event, the Borrower shall be deemed to have requested a Committed Borrowing of Base Rate Loans to be disbursed on the Honor Date in an amount equal to the Unreimbursed Amount, without regard to the minimum and multiples specified in Section 2.02 for the principal amount of Base Rate Loans, but subject to the amount of the unutilized portion of the Aggregate Commitments and the conditions set forth in Section 4.02 (other than the delivery of a Committed Loan Notice).  Any notice given by the L/C Issuer or the Administrative Agent pursuant to this Section 2.03(c)(i) may be given by telephone if immediately confirmed in writing; provided that the lack of such an immediate confirmation shall not affect the conclusiveness or binding effect of such notice.

 

(ii) Each Lender shall upon any notice pursuant to Section 2.03(c)(i) make funds available to the Administrative Agent for the account of the L/C Issuer at the Administrative Agent’s Office in an amount equal to its Applicable Percentage of the Unreimbursed Amount not later than 2:00 p.m. on the Business Day specified in such notice by the Administrative Agent, whereupon, subject to the provisions of Section 2.03(c)(iii), each Lender that so makes funds available shall be deemed to have made a Base Rate Committed Loan to the Borrower in such amount.  The Administrative Agent shall remit the funds so received to the L/C Issuer.

 

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(iii) With respect to any Unreimbursed Amount that is not fully refinanced by a Committed Borrowing of Base Rate Loans because the conditions set forth in Section 4.02 cannot be satisfied or for any other reason, the Borrower shall be deemed to have incurred from the L/C Issuer an L/C Borrowing in the amount of the Unreimbursed Amount that is not so refinanced, which L/C Borrowing shall be due and payable on demand (together with interest) and shall bear interest at the Default Rate.  In such event, each Lender’s payment to the Administrative Agent for the account of the L/C Issuer pursuant to Section 2.03(c)(ii) shall be deemed payment in respect of its participation in such L/C Borrowing and shall constitute an L/C Advance from such Lender in satisfaction of its participation obligation under this Section 2.03.

 

(iv) Until each Lender funds its Committed Loan or L/C Advance pursuant to this Section 2.03(c) to reimburse the L/C Issuer for any amount drawn under any Letter of Credit, interest in respect of such Lender’s Applicable Percentage of such amount shall be solely for the account of the L/C Issuer.

 

(v) Each Lender’s obligation to make Committed Loans or L/C Advances to reimburse the L/C Issuer for amounts drawn under Letters of Credit, as contemplated by this Section 2.03(c), shall be absolute and unconditional and shall not be affected by any circumstance, including (A) any setoff, counterclaim, recoupment, defense or other right which such Lender may have against the L/C Issuer, the Borrower or any other Person for any reason whatsoever; (B) the occurrence or continuance of a Default, or (C) any other occurrence, event or condition, whether or not similar to any of the foregoing; provided, however, that each Lender’s obligation to make Committed Loans pursuant to this Section 2.03(c) is subject to the conditions set forth in Section 4.02 (other than delivery by the Borrower of a Committed Loan Notice).  No such making of an L/C Advance shall relieve or otherwise impair the obligation of the Borrower to reimburse the L/C Issuer for the amount of any payment made by the L/C Issuer under any Letter of Credit, together with interest as provided herein.

 

(vi) If any Lender fails to make available to the Administrative Agent for the account of the L/C Issuer any amount required to be paid by such Lender pursuant to the foregoing provisions of this Section 2.03(c) by the time specified in Section 2.03(c)(ii), the L/C Issuer shall be entitled to recover from such Lender (acting through the Administrative Agent), on demand, such amount with interest thereon for the period from the date such payment is required to the date on which such payment is immediately available to the L/C Issuer at a rate per annum equal to the greater of the Federal Funds Rate and a rate determined by the L/C Issuer in accordance with banking industry rules on interbank compensation, plus any administrative, processing or similar fees customarily charged by the L/C Issuer in connection with the foregoing.  If such Lender pays such amount (with interest and fees as aforesaid), the amount so paid shall constitute such Lender’s Committed Loan included in the relevant Committed Borrowing or L/C Advance in respect of the relevant L/C Borrowing, as the case may be.  A certificate 

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of the L/C Issuer submitted to any Lender (through the Administrative Agent) with respect to any amounts owing under this clause (vi) shall be conclusive absent manifest error.

 

(d) Repayment of Participations.

 

(i) At any time after the L/C Issuer has made a payment under any Letter of Credit and has received from any Lender such Lender’s L/C Advance in respect of such payment in accordance with Section 2.03(c), if the Administrative Agent receives for the account of the L/C Issuer any payment in respect of the related Unreimbursed Amount or interest thereon (whether directly from the Borrower or otherwise, including proceeds of Cash Collateral applied thereto by the Administrative Agent), the Administrative Agent will distribute to such Lender its Applicable Percentage thereof in the same funds as those received by the Administrative Agent.

 

(ii) If any payment received by the Administrative Agent for the account of the L/C Issuer pursuant to Section 2.03(c)(i) is required to be returned under any of the circumstances described in Section 10.05 (including pursuant to any settlement entered into by the L/C Issuer in its discretion), each Lender shall pay to the Administrative Agent for the account of the L/C Issuer its Applicable Percentage thereof on demand of the Administrative Agent, plus interest thereon from the date of such demand to the date such amount is returned by such Lender, at a rate per annum equal to the Federal Funds Rate from time to time in effect.  The obligations of the Lenders under this clause shall survive the payment in full of the Obligations and the termination of this Agreement.

 

(e) Obligations Absolute. The obligation of the Borrower to reimburse the L/C Issuer for each drawing under each Letter of Credit and to repay each L/C Borrowing shall be absolute, unconditional and irrevocable, and shall be paid strictly in accordance with the terms of this Agreement under all circumstances, including the following:

 

(i) any lack of validity or enforceability of such Letter of Credit, this Agreement, or any other Loan Document;

 

(ii) the existence of any claim, counterclaim, setoff, defense or other right that the Borrower or any Restricted Subsidiary may have at any time against any beneficiary or any transferee of such Letter of Credit (or any Person for whom any such beneficiary or any such transferee may be acting), the L/C Issuer or any other Person, whether in connection with this Agreement, the transactions contemplated hereby or by such Letter of Credit or any agreement or instrument relating thereto, or any unrelated transaction;

 

(iii) any draft, demand, certificate or other document presented under such Letter of Credit proving to be forged, fraudulent, invalid or insufficient in any respect or any statement therein being untrue or inaccurate in any respect; or any loss or delay in the transmission or otherwise of any document required in order to make a drawing under such Letter of Credit;

 

(iv) any payment by the L/C Issuer under such Letter of Credit against presentation of a draft or certificate that does not strictly comply with the terms of such Letter of Credit; or any payment made by the L/C Issuer under such Letter of Credit to 

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any Person purporting to be a trustee in bankruptcy, debtor-in-possession, assignee for the benefit of creditors, liquidator, receiver or other representative of or successor to any beneficiary or any transferee of such Letter of Credit, including any arising in connection with any proceeding under any Debtor Relief Law; or

 

(v) any other circumstance or happening whatsoever, whether or not similar to any of the foregoing, including any other circumstance that might otherwise constitute a defense available to, or a discharge of, the Borrower or any Restricted Subsidiary.

 

The Borrower shall promptly examine a copy of each Letter of Credit and each amendment thereto that is delivered to it and, in the event of any claim of noncompliance with the Borrower’s instructions or other irregularity, the Borrower will immediately notify the L/C Issuer.  The Borrower shall be conclusively deemed to have waived any such claim against the L/C Issuer and its correspondents unless such notice is given as aforesaid.

 

(f) Role of L/C Issuer. Each Lender and the Borrower agree that, in paying any drawing under a Letter of Credit, the L/C Issuer shall not have any responsibility to obtain any document (other than any sight draft, certificates and documents expressly required by the Letter of Credit) or to ascertain or inquire as to the validity or accuracy of any such document or the authority of the Person executing or delivering any such document.  None of the L/C Issuer, the Administrative Agent, any of their respective Related Parties nor any correspondent, participant or assignee of the L/C Issuer shall be liable to any Lender for (i) any action taken or omitted in connection herewith at the request or with the approval of the Lenders or the Required Lenders, as applicable; (ii) any action taken or omitted in the absence of gross negligence or willful misconduct; or (iii) the due execution, effectiveness, validity or enforceability of any document or instrument related to any Letter of Credit or Issuer Document.  The Borrower hereby assumes all risks of the acts or omissions of any beneficiary or transferee with respect to its use of any Letter of Credit; provided, however, that this assumption is not intended to, and shall not, preclude the Borrower’s pursuing such rights and remedies as it may have against the beneficiary or transferee at law or under any other agreement.  None of the L/C Issuer, the Administrative Agent, any of their respective Related Parties nor any correspondent, participant or assignee of the L/C Issuer shall be liable or responsible for any of the matters described in clauses (i) through (v) of Section 2.03(e); provided, however, that anything in such clauses to the contrary notwithstanding, the Borrower may have a claim against the L/C Issuer, and the L/C Issuer may be liable to the Borrower, to the extent, but only to the extent, of any direct, as opposed to consequential or exemplary, damages suffered by the Borrower which the Borrower proves were caused by the L/C Issuer’s willful misconduct or gross negligence or the L/C Issuer’s willful failure to pay under any Letter of Credit after the presentation to it by the beneficiary of a sight draft and certificate(s) strictly complying with the terms and conditions of a Letter of Credit.  In furtherance and not in limitation of the foregoing, the L/C Issuer may accept documents that appear on their face to be in order, without responsibility for further investigation, regardless of any notice or information to the contrary, and the L/C Issuer shall not be responsible for the validity or sufficiency of any instrument transferring or assigning or purporting to transfer or assign a Letter of Credit or the rights or benefits thereunder or proceeds thereof, in whole or in part, which may prove to be invalid or ineffective for any reason.

 

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(g) Cash Collateral.  Upon the request of the Administrative Agent, (i) if the L/C Issuer has honored any full or partial drawing request under any Letter of Credit and such drawing has resulted in an L/C Borrowing, or (ii) if, as of the Letter of Credit Expiration Date, any L/C Obligation for any reason remains outstanding, the Borrower shall, in each case, immediately Cash Collateralize the then Outstanding Amount of all L/C Obligations.  Sections 2.05 and 8.02(c) set forth certain additional requirements to deliver Cash Collateral hereunder.  For purposes of this Section 2.03, Section 2.05 and Section 8.02(c), “Cash Collateralize” means to pledge and deposit with or deliver to the Administrative Agent, for the benefit of the L/C Issuer and the Lenders, as collateral for the L/C Obligations, cash or deposit account balances pursuant to documentation in form and substance reasonably satisfactory to the Administrative Agent and the L/C Issuer (which documents are hereby consented to by the Lenders).  Derivatives of such term have corresponding meanings.  The Borrower hereby grants to the Administrative Agent, for the benefit of the L/C Issuer and the Lenders, a security interest in all such cash, deposit accounts and all balances therein and all proceeds of the foregoing.  Cash Collateral shall be maintained in blocked, non-interest bearing deposit accounts at Bank of America.  Upon the drawing of any Letter of Credit for which funds are on deposit as Cash Collateral, such funds shall be applied to reimburse the L/C Issuer in accordance with Section 2.03(c)(i) and to pay any outstanding and accrued interest on such amounts.  To the extent that the amount of any Cash Collateral exceeds the then Outstanding Amount of L/C Obligations and so long as no Default of the type specified in clauses (a), (f) or (g) of Section 8.01 or Event of Default has occurred and is continuing, the excess shall be refunded to the Borrower.

 

(h) Applicability of ISP and UCP.   Unless otherwise expressly agreed by the L/C Issuer and the Borrower when a Letter of Credit is issued, (i) the rules of the ISP shall apply to each standby Letter of Credit, and (ii) the rules of the Uniform Customs and Practice for Documentary Credits, as most recently published by the International Chamber of Commerce at the time of issuance, shall apply to each commercial Letter of Credit.

 

(i) Letter of Credit Fees.  The Borrower shall pay to the Administrative Agent for the account of each Lender in accordance with its Applicable Percentage a Letter of Credit fee (the “Letter of Credit Fee”) for each Letter of Credit equal to the Applicable Rate times the daily amount available to be drawn under such Letter of Credit.  For purposes of computing the daily amount available to be drawn under any Letter of Credit, the amount of such Letter of Credit shall be determined in accordance with Section 1.07.  Letter of Credit Fees shall be (i) due and payable on the first Business Day after the end of each March, June, September and December, commencing with the first such date to occur after the issuance of such Letter of Credit, on the Letter of Credit Expiration Date and thereafter on demand and (ii) computed on a quarterly basis in arrears.  If there is any change in the Applicable Rate during any quarter, the daily amount available to be drawn under each Letter of Credit shall be computed and multiplied by the Applicable Rate separately for each period during such quarter that such Applicable Rate was in effect.

 

(j) Fronting Fee and Documentary and Processing Charges Payable to L/C Issuer. The Borrower shall pay directly to the L/C Issuer for its own account a fronting fee with respect to each Letter of Credit, at the rate per annum specified in the Arrangers’ Fee Letter, computed on the daily amount available to be drawn under such Letter of Credit on a quarterly basis in arrears.  Such fronting fee shall be due and payable on the tenth Business Day after the end of 

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each March, June, September and December in respect of the most recently-ended quarterly period (or portion thereof, in the case of the first payment), commencing with the first such date to occur after the issuance of such Letter of Credit, on the Letter of Credit Expiration Date and thereafter on demand.  For purposes of computing the daily amount available to be drawn under any Letter of Credit, the amount of such Letter of Credit shall be determined in accordance with Section 1.07.  In addition, the Borrower shall pay directly to the L/C Issuer for its own account the customary issuance, presentation, amendment and other processing fees, and other standard costs and charges, of the L/C Issuer relating to letters of credit as from time to time in effect.  Such customary fees and standard costs and charges are due and payable on demand and are nonrefundable.

 

(k) Conflict with Issuer Documents.  In the event of any conflict between the terms hereof and the terms of any Issuer Document, the terms hereof shall control.

 

(l) Letters of Credit Issued for Subsidiaries.  Notwithstanding that a Letter of Credit issued or outstanding hereunder is in support of any obligations of, or is for the account of, a Restricted Subsidiary, the Borrower shall be obligated to reimburse the L/C Issuer hereunder for any and all drawings under such Letter of Credit.  The Borrower hereby acknowledges that the issuance of Letters of Credit for the account of Restricted Subsidiaries inures to the benefit of the Borrower, and that the Borrower’s business derives substantial benefits from the businesses of such Subsidiaries.

 

2.04 Swing Line Loans.

 

(a) The Swing Line.  Subject to the terms and conditions set forth herein, the Swing Line Lender agrees, in reliance upon the agreements of the other Lenders set forth in this Section 2.04, to make loans (each such loan, a “Swing Line Loan”) to the Borrower from time to time on any Business Day during the Availability Period in an aggregate amount not to exceed at any time outstanding the amount of the Swing Line Sublimit, notwithstanding the fact that such Swing Line Loans, when aggregated with the Applicable Percentage of the Outstanding Amount of Committed Loans and L/C Obligations of the Lender acting as Swing Line Lender, may exceed the amount of such Lender’s Commitment; provided, however, that after giving effect to any Swing Line Loan, (i) the Total Outstandings shall not exceed the Aggregate Commitments, and (ii) the aggregate Outstanding Amount of the Committed Loans of any Lender, plus such Lender’s Applicable Percentage of the Outstanding Amount of all L/C Obligations, plus such Lender’s Applicable Percentage of the Outstanding Amount of all Swing Line Loans shall not exceed such Lender’s Commitment, and provided, further, that the Borrower shall not use the proceeds of any Swing Line Loan to refinance any outstanding Swing Line Loan.  Within the foregoing limits, and subject to the other terms and conditions hereof, the Borrower may borrow under this Section 2.04, prepay under Section 2.05, and reborrow under this Section 2.04.  Each Swing Line Loan shall be a Base Rate Loan.  Immediately upon the making of a Swing Line Loan, each Lender shall be deemed to, and hereby irrevocably and unconditionally agrees to, purchase from the Swing Line Lender a risk participation in such Swing Line Loan in an amount equal to the product of such Lender’s Applicable Percentage times the amount of such Swing Line Loan.

 

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(b) Borrowing Procedures.  Each Swing Line Borrowing shall be made upon the Borrower’s irrevocable notice to the Swing Line Lender and the Administrative Agent, which may be given by telephone. Each such notice must be received by the Swing Line Lender and the Administrative Agent not later than 1:00 p.m. on the requested borrowing date, and shall specify (i) the amount to be borrowed, which shall be a minimum of $500,000 or a whole multiple of $100,000 in excess thereof, and (ii) the requested borrowing date, which shall be a Business Day.  Each such telephonic notice must be confirmed promptly by delivery to the Swing Line Lender and the Administrative Agent of a written Swing Line Loan Notice, appropriately completed and signed by a Responsible Officer of the Borrower.  Promptly after receipt by the Swing Line Lender of any telephonic Swing Line Loan Notice, the Swing Line Lender will confirm with the Administrative Agent (by telephone or in writing) that the Administrative Agent has also received such Swing Line Loan Notice and, if not, the Swing Line Lender will notify the Administrative Agent (by telephone or in writing) of the contents thereof.  Unless the Swing Line Lender has received notice (by telephone or in writing) from the Administrative Agent (including at the request of any Lender) prior to 2:00 p.m. on the date of the proposed Swing Line Borrowing (A) directing the Swing Line Lender not to make such Swing Line Loan as a result of the limitations set forth in the first proviso to the first sentence of Section 2.04(a), or (B) that one or more of the applicable conditions specified in Article IV is not then satisfied, then, subject to the terms and conditions hereof, the Swing Line Lender will, not later than 3:00 p.m. on the borrowing date specified in such Swing Line Loan Notice, make the amount of its Swing Line Loan available to the Borrower.

 

(c) Refinancing of Swing Line Loans.

 

(i) The Swing Line Lender at any time in its sole and absolute discretion may request, on behalf of the Borrower (which hereby irrevocably authorizes the Swing Line Lender to so request on its behalf), that each Lender make a Base Rate Committed Loan in an amount equal to such Lender’s Applicable Percentage of the amount of Swing Line Loans then outstanding.  Such request shall be made in writing (which written request shall be deemed to be a Committed Loan Notice for purposes hereof) and in accordance with the requirements of Section 2.02, without regard to the minimum and multiples specified therein for the principal amount of Base Rate Loans, but subject to the unutilized portion of the Aggregate Commitments and the conditions set forth in Section 4.02.  The Swing Line Lender shall furnish the Borrower with a copy of the applicable Committed Loan Notice promptly after delivering such notice to the Administrative Agent.  Each Lender shall make an amount equal to its Applicable Percentage of the amount specified in such Committed Loan Notice available to the Administrative Agent in immediately available funds for the account of the Swing Line Lender at the Administrative Agent’s Office not later than 1:00 p.m. on the day specified in such Committed Loan Notice, whereupon, subject to Section 2.04(c)(ii), each Lender that so makes funds available shall be deemed to have made a Base Rate Committed Loan to the Borrower in such amount.  The Administrative Agent shall remit the funds so received to the Swing Line Lender.

 

(ii) If for any reason any Swing Line Loan cannot be refinanced by such a Committed Borrowing in accordance with Section 2.04(c)(i), the request for Base Rate Committed Loans submitted by the Swing Line Lender as set forth herein shall be 

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deemed to be a request by the Swing Line Lender that each of the Lenders fund its risk participation in the relevant Swing Line Loan and each Lender’s payment to the Administrative Agent for the account of the Swing Line Lender pursuant to Section 2.04(c)(i) shall be deemed payment in respect of such participation.

 

(iii) If any Lender fails to make available to the Administrative Agent for the account of the Swing Line Lender any amount required to be paid by such Lender pursuant to the foregoing provisions of this Section 2.04(c) by the time specified in Section 2.04(c)(i), the Swing Line Lender shall be entitled to recover from such Lender (acting through the Administrative Agent), on demand, such amount with interest thereon for the period from the date such payment is required to the date on which such payment is immediately available to the Swing Line Lender at a rate per annum equal to the greater of the Federal Funds Rate and a rate determined by the Swing Line Lender in accordance with banking industry rules on interbank compensation, plus any administrative, processing or similar fees customarily charged by the Swing Line Lender in connection with the foregoing.  If such Lender pays such amount (with interest and fees as aforesaid), the amount so paid shall constitute such Lender’s Committed Loan included in the relevant Committed Borrowing or funded participation in the relevant Swing Line Loan, as the case may be.  A certificate of the Swing Line Lender submitted to any Lender (through the Administrative Agent) with respect to any amounts owing under this clause (iii) shall be conclusive absent manifest error.

 

(iv) Each Lender’s obligation to make Committed Loans or to purchase and fund risk participations in Swing Line Loans pursuant to this Section 2.04(c) shall be absolute and unconditional and shall not be affected by any circumstance, including (A) any setoff, counterclaim, recoupment, defense or other right which such Lender may have against the Swing Line Lender, the Borrower or any other Person for any reason whatsoever, (B) the occurrence or continuance of a Default, or (C) any other occurrence, event or condition, whether or not similar to any of the foregoing; provided, however, that each Lender’s obligation to make Committed Loans pursuant to this Section 2.04(c) is subject to the conditions set forth in Section 4.02.  No such funding of risk participations shall relieve or otherwise impair the obligation of the Borrower to repay Swing Line Loans, together with interest as provided herein.

 

(d) Repayment of Participations.

 

(i) At any time after any Lender has purchased and funded a risk participation in a Swing Line Loan, if the Swing Line Lender receives any payment on account of such Swing Line Loan, the Swing Line Lender will distribute to such Lender its Applicable Percentage thereof in the same funds as those received by the Swing Line Lender.

 

(ii) If any payment received by the Swing Line Lender in respect of principal or interest on any Swing Line Loan is required to be returned by the Swing Line Lender under any of the circumstances described in Section 10.05 (including pursuant to any settlement entered into by the Swing Line Lender in its discretion), each Lender shall pay to the Swing Line Lender its Applicable Percentage thereof on demand of the Administrative Agent, plus interest thereon from the date of such demand to the date such 

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amount is returned, at a rate per annum equal to the Federal Funds Rate.  The Administrative Agent will make such demand upon the request of the Swing Line Lender.  The obligations of the Lenders under this clause shall survive the payment in full of the Obligations and the termination of this Agreement.

 

(e) Interest for Account of Swing Line Lender.  The Swing Line Lender shall be responsible for invoicing the Borrower for interest on the Swing Line Loans.  Until each Lender funds its Base Rate Committed Loan or risk participation pursuant to this Section 2.04 to refinance such Lender’s Applicable Percentage of any Swing Line Loan, interest in respect of such Applicable Percentage shall be solely for the account of the Swing Line Lender.

 

(f) Payments Directly to Swing Line Lender.  The Borrower shall make all payments of principal and interest in respect of the Swing Line Loans directly to the Swing Line Lender.

 

2.05 Prepayments.

 

  (a)  The Borrower may, upon notice to the Administrative Agent, at any time or from time to time voluntarily prepay Committed Loans in whole or in part without premium or penalty; provided that (i) such notice must be received by the Administrative Agent not later than 12:00 noon (A) three Business Days prior to any date of prepayment of Eurodollar Rate Loans (or in connection with the termination of the Aggregate Commitments pursuant to Section 2.06, such later date as may be agreed to by the Administrative Agent) and (B) on the date of prepayment of Base Rate Committed Loans; (ii) any prepayment of Eurodollar Rate Loans shall be in a principal amount of $5,000,000 or a whole multiple of $1,000,000 in excess thereof; and (iii) any prepayment of Base Rate Committed Loans shall be in a principal amount of $500,000 or a whole multiple of $100,000 in excess thereof or, in each case, if less, the entire principal amount thereof then outstanding.  Each such notice shall specify the date and amount of such prepayment and the Type(s) of Committed Loans to be prepaid and, if Eurodollar Rate Loans are to be prepaid, the Interest Period(s) of such Loans.  The Administrative Agent will promptly notify each Lender of its receipt of each such notice, and of the amount of such Lender’s Applicable Percentage of such prepayment.  If such notice is given by the Borrower, the Borrower shall make such prepayment and the payment amount specified in such notice shall be due and payable on the date specified therein.  Any prepayment of a Eurodollar Rate Loan shall be accompanied by all accrued interest on the amount prepaid, together with any additional amounts required pursuant to Section 3.05.  Each such prepayment shall be applied to the Committed Loans of the Lenders in accordance with their respective Applicable Percentages.

 

(b) The Borrower may, upon notice to the Swing Line Lender (with a copy to the Administrative Agent), at any time or from time to time, voluntarily prepay Swing Line Loans in whole or in part without premium or penalty; provided that (i) such notice must be received by the Swing Line Lender and the Administrative Agent not later than 1:00 p.m. on the date of the prepayment, and (ii) any such prepayment shall be in a minimum principal amount of $100,000.  Each such notice shall specify the date and amount of such prepayment.  If such notice is given by the Borrower, the Borrower shall make such prepayment and the payment amount specified in such notice shall be due and payable on the date specified therein.

 

(c) If for any reason the Total Outstandings at any time exceed the Aggregate Commitments then in effect, the Borrower shall immediately prepay Loans and/or Cash Collateralize the L/C Obligations in an aggregate amount equal to such excess; provided,

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however, that the Borrower shall not be required to Cash Collateralize the L/C Obligations pursuant to this Section 2.05(c) unless after the prepayment in full of the Loans the Total Outstandings exceed the Aggregate Commitments then in effect.

 

2.06 Termination or Reduction of Commitments.  The Borrower may, upon notice to the Administrative Agent, terminate the Aggregate Commitments, or from time to time permanently reduce the Aggregate Commitments; provided that (i) any such notice shall be received by the Administrative Agent not later than 11:00 a.m. three Business Days prior to the date of termination or reduction (or, in connection with the termination of the Aggregate Commitments, such later date as may be agreed to by the Administrative Agent), (ii) any such partial reduction shall be in an aggregate amount of $5,000,000 or any whole multiple of $1,000,000 in excess thereof, (iii) the Borrower shall not terminate or reduce the Aggregate Commitments if, after giving effect thereto and to any concurrent prepayments hereunder, the Total Outstandings would exceed the Aggregate Commitments, and (iv) if, after giving effect to any reduction of the Aggregate Commitments, the Letter of Credit Sublimit or the Swing Line Sublimit exceeds the amount of the Aggregate Commitments, such Sublimit shall be automatically reduced by the amount of such excess.  The Administrative Agent will promptly notify the Lenders of any such notice of termination or reduction of the Aggregate Commitments.  Any reduction of the Aggregate Commitments shall be applied to the Commitment of each Lender according to its Applicable Percentage.  All fees accrued until the effective date of any termination of the Aggregate Commitments shall be paid on the effective date of such termination.  Notwithstanding anything in this Section 2.06 to the contrary, a notice of termination of the Commitments delivered by the Borrower may state that such notice is conditioned upon the effectiveness of other credit facilities, in which case such notice may be revoked by the Borrower (by notice to the Administrative Agent on or prior to the specified effective date) if such condition is not satisfied.

 

2.07 Repayment of Loans.  (a)  The Borrower hereby unconditionally promises to pay to the Lenders on the Maturity Date the aggregate principal amount of Committed Loans (along with all accrued and unpaid interest and other amounts outstanding with respect to such Loans) outstanding on such date.

 

(b) The Borrower hereby unconditionally promises to pay each Swing Line Loan (along with all accrued and unpaid interest and other amounts outstanding with respect to such Loans) on the earlier to occur of (i) the date ten Business Days after such Loan is made and (ii) the Maturity Date.

 

2.08 Interest.  (a)  Subject to the provisions of subsection (b) below, (i) each Eurodollar Rate Loan shall bear interest on the outstanding principal amount thereof for each Interest Period at a rate per annum equal to the Eurodollar Rate for such Interest Period plus the Applicable Rate; (ii) each Base Rate Committed Loan shall bear interest on the outstanding principal amount thereof from the applicable borrowing date at a rate per annum equal to the Base Rate plus the Applicable Rate; and (iii) each Swing Line Loan shall bear interest on the outstanding principal amount thereof from the applicable borrowing date at a rate per annum equal to the Base Rate plus the Applicable Rate.

 

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(b) (i)           If any amount of principal of any Loan is not paid when due (without regard to any applicable grace periods), whether at stated maturity, by acceleration or otherwise, such amount shall thereafter bear interest at a fluctuating interest rate per annum at all times equal to the Default Rate to the fullest extent permitted by applicable Laws.

 

(ii) If any amount (other than principal of any Loan) payable by the Borrower under any Loan Document is not paid when due (without regard to any applicable grace periods), whether at stated maturity, by acceleration or otherwise, then upon the request of the Required Lenders, such amount shall thereafter bear interest at a fluctuating interest rate per annum at all times equal to the Default Rate to the fullest extent permitted by applicable Laws.

 

(iii) Accrued and unpaid interest on past due amounts (including interest on past due interest) shall be due and payable upon demand.

 

(c) Interest on each Loan shall be due and payable in arrears on each Interest Payment Date applicable thereto and at such other times as may be specified herein.  Interest hereunder shall be due and payable in accordance with the terms hereof before and after judgment, and before and after the commencement of any proceeding under any Debtor Relief Law.

 

2.09 Fees.  In addition to certain fees described in subsections (i) and (j) of Section 2.03:

 

(a) Commitment Fee. The Borrower shall pay to the Administrative Agent for the account of each Lender in accordance with its Applicable Percentage, a commitment fee equal to the Applicable Rate times the actual daily amount by which the Aggregate Commitments exceed the sum of (i) the Outstanding Amount of Committed Loans and (ii) the Outstanding Amount of L/C Obligations.  The commitment fee shall accrue at all times during the Availability Period, including at any time during which one or more of the conditions in Article IV is not met, and shall be due and payable quarterly in arrears on the last Business Day of each March, June, September and December, commencing with the first such date to occur after the Closing Date, and on the last day of the Availability Period.  The commitment fee shall be calculated quarterly in arrears, and if there is any change in the Applicable Rate during any quarter, the actual daily amount shall be computed and multiplied by the Applicable Rate separately for each period during such quarter that such Applicable Rate was in effect.

 

(b) Other Fees.  (i) The Borrower shall pay to the Co-Arrangers and the Administrative Agent for their own respective accounts fees in the amounts and at the times specified in the Fee Letters.  Such fees shall be fully earned when paid and shall not be refundable for any reason whatsoever.

 

(ii) The Borrower shall pay to the Lenders such fees as shall have been separately agreed upon in writing in the amounts and at the times so specified.  Such fees shall be fully earned when paid and shall not be refundable for any reason whatsoever.

 

2.10 Computation of Interest and Fees; Retroactive Adjustments of Applicable Rate.  (a) All computations of interest for Base Rate Loans when the Base Rate is determined by Bank of America’s 

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“prime rate” shall be made on the basis of a year of 365 or 366 days, as the case may be, and actual days elapsed.  All other computations of fees and interest shall be made on the basis of a 360-day year and actual days elapsed (which results in more fees or interest, as applicable, being paid than if computed on the basis of a 365-day year).  Interest shall accrue on each Loan for the day on which the Loan is made, and shall not accrue on a Loan, or any portion thereof, for the day on which the Loan or such portion is paid, provided that any Loan that is repaid on the same day on which it is made shall, subject to Section 2.12(a), bear interest for one day.  Each determination by the Administrative Agent of an interest rate or fee hereunder shall be conclusive and binding for all purposes, absent manifest error.

 

(b) If, as a result of any restatement of or other adjustment to the financial statements of the Borrower or for any other reason, the Borrower or the Lenders determine that (i) the Consolidated Leverage Ratio as calculated by the Borrower as of any applicable date was inaccurate and (ii) a proper calculation of the Consolidated Leverage Ratio would have resulted in higher pricing for such period, the Borrower shall immediately and retroactively be obligated to pay to the Administrative Agent for the account of the applicable Lenders, promptly on demand by the Administrative Agent (or, after the occurrence of an actual or deemed entry of an order for relief with respect to the Borrower under the Bankruptcy Code of the United States, automatically and without further action by the Administrative Agent, any Lender or the L/C Issuer), an amount equal to the excess of the amount of interest and fees that should have been paid for such period over the amount of interest and fees actually paid for such period.  This paragraph shall not limit the rights of the Administrative Agent, any Lender or the L/C Issuer, as the case may be, under Section 2.03(c)(iii), 2.03(i) or 2.08(b) or under Article VIII.  The Borrower’s obligations under this paragraph shall survive the termination of the Aggregate Commitments and the repayment of all other Obligations hereunder.

 

2.11 Evidence of Debt.  (a)  The Credit Extensions made by each Lender shall be evidenced by one or more accounts or records maintained by such Lender and by the Administrative Agent in the ordinary course of business.  The accounts or records maintained by the Administrative Agent and each Lender shall be prima facie evidence of the amount of the Credit Extensions made by the Lenders to the Borrower and the interest and payments thereon.  Any failure to so record or any error in doing so shall not, however, limit or otherwise affect the obligation of the Borrower hereunder to pay any amount owing with respect to the Obligations.  In the event of any conflict between the accounts and records maintained by any Lender and the accounts and records of the Administrative Agent in respect of such matters, the accounts and records of the Administrative Agent shall control in the absence of manifest error.  Upon the request of any Lender made through the Administrative Agent, the Borrower shall execute and deliver to such Lender (through the Administrative Agent) a Note, which shall evidence such Lender’s Loans in addition to such accounts or records.  Each Lender may attach schedules to its Note and endorse thereon the date, Type (if applicable), amount and maturity of its Loans and payments with respect thereto.

 

(b) In addition to the accounts and records referred to in subsection (a), each Lender and the Administrative Agent shall maintain in accordance with its usual practice accounts or records evidencing the purchases and sales by such Lender of participations in Letters of Credit and Swing Line Loans.  In the event of any conflict between the accounts and records maintained by the Administrative Agent and the accounts and records of any Lender in respect of such matters, the accounts and records of the Administrative Agent shall control in the absence of manifest error.

 

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2.12 Payments Generally; Administrative Agent’s Clawback.

 

(a) General.  All payments to be made by the Borrower shall be made without condition or deduction for any counterclaim, defense, recoupment or setoff.  Except as otherwise expressly provided herein, all payments by the Borrower hereunder shall be made to the Administrative Agent, for the account of the respective Lenders to which such payment is owed, at the Administrative Agent’s Office in Dollars and in immediately available funds not later than 2:00 p.m. on the date specified herein.  The Administrative Agent will promptly distribute to each Lender its Applicable Percentage (or other applicable share as provided herein) of such payment in like funds as received by wire transfer to such Lender’s Lending Office.  All payments received by the Administrative Agent after 2:00 p.m. shall be deemed received on the next succeeding Business Day and any applicable interest or fee shall continue to accrue.  If any payment to be made by the Borrower shall come due on a day other than a Business Day, payment shall be made on the next following Business Day, and such extension of time shall be reflected in computing interest or fees, as the case may be.

 

(b) (i) Funding by Lenders; Presumption by Administrative Agent.  Unless the Administrative Agent shall have received notice from a Lender prior to the proposed date of any Committed Borrowing of Eurodollar Rate Loans (or, in the case of any Committed Borrowing of Base Rate Loans, prior to 1:00 p.m. on the date of such Committed Borrowing) that such Lender will not make available to the Administrative Agent such Lender’s share of such Committed Borrowing, the Administrative Agent may assume that such Lender has made such share available on such date in accordance with Section 2.02 (or, in the case of a Committed Borrowing of Base Rate Loans, that such Lender has made such share available in accordance with and at the time required by Section 2.02) and may, in reliance upon such assumption, make available to the Borrower a corresponding amount.  In such event, if a Lender has not in fact made its share of the applicable Committed Borrowing available to the Administrative Agent, then the applicable Lender and the Borrower severally agree to pay to the Administrative Agent forthwith on demand such corresponding amount in immediately available funds with interest thereon, for each day from and including the date such amount is made available to the Borrower to but excluding the date of payment to the Administrative Agent, at (A) in the case of a payment to be made by such Lender, the greater of the Federal Funds Rate and a rate determined by the Administrative Agent in accordance with banking industry rules on interbank compensation, plus any administrative, processing or similar fees customarily charged by the Administrative Agent in connection with the foregoing, and (B) in the case of a payment to be made by the Borrower, the interest rate applicable to Base Rate Loans.  If the Borrower and such Lender shall pay such interest to the Administrative Agent for the same or an overlapping period, the Administrative Agent shall promptly remit to the Borrower the amount of such interest paid by the Borrower for such period.  If such Lender pays its share of the applicable Committed Borrowing to the Administrative Agent, then the amount so paid shall constitute such Lender’s Committed Loan included in such Committed Borrowing.  Any payment by the Borrower shall be without prejudice to any claim the Borrower may have against a Lender that shall have failed to make such payment to the Administrative Agent.

 

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(ii) Payments by Borrower; Presumptions by Administrative Agent.  Unless the Administrative Agent shall have received notice from the Borrower prior to the date on which any payment is due to the Administrative Agent for the account of the Lenders or the L/C Issuer hereunder that the Borrower will not make such payment, the Administrative Agent may assume that the Borrower has made such payment on such date in accordance herewith and may, in reliance upon such assumption, distribute to the Lenders or the L/C Issuer, as the case may be, the amount due.  In such event, if the Borrower has not in fact made such payment, then each of the Lenders or the L/C Issuer, as the case may be, severally agrees to repay to the Administrative Agent forthwith on demand the amount so distributed to such Lender or the L/C Issuer, in immediately available funds with interest thereon, for each day from and including the date such amount is distributed to it to but excluding the date of payment to the Administrative Agent, at the greater of the Federal Funds Rate and a rate determined by the Administrative Agent in accordance with banking industry rules on interbank compensation.

 

A notice of the Administrative Agent to any Lender or the Borrower with respect to any amount owing under this subsection (b) shall be prima facie evidence of the amount owing.

 

(c) Failure to Satisfy Conditions Precedent.  If any Lender makes available to the Administrative Agent funds for any Loan to be made by such Lender as provided in the foregoing provisions of this Article II, and such funds are not made available to the Borrower by the Administrative Agent because the conditions to the applicable Credit Extension set forth in Article IV are not satisfied or waived in accordance with the terms hereof, the Administrative Agent shall return such funds (in like funds as received from such Lender) to such Lender, without interest.

 

(d) Obligations of Lenders Several.  The obligations of the Lenders hereunder to make Committed Loans, to fund participations in Letters of Credit and Swing Line Loans and to make payments pursuant to Section 10.04(c) are several and not joint.  The failure of any Lender to make any Committed Loan, to fund any such participation or to make any payment under Section 10.04(c) on any date required hereunder shall not relieve any other Lender of its corresponding obligation to do so on such date, and no Lender shall be responsible for the failure of any other Lender to so make its Committed Loan, to purchase its participation or to make its payment under Section 10.04(c).

 

(e) Funding Source.  Nothing herein shall be deemed to obligate any Lender to obtain the funds for any Loan in any particular place or manner or to constitute a representation by any Lender that it has obtained or will obtain the funds for any Loan in any particular place or manner.

 

(f) Insufficient Funds.  If at any time insufficient funds are received by and available to the Administrative Agent to pay fully all amounts of principal, L/C Borrowings, interest and fees then due hereunder, such funds shall be applied (i) first, toward payment of interest and fees then due hereunder, ratably among the parties entitled thereto in accordance with the amounts of interest and fees then due to such parties, and (ii) second, toward 

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payment of principal and L/C Borrowings then due hereunder, ratably among the parties entitled thereto in accordance with the amounts of principal and L/C Borrowings then due to such parties.

 

2.13 Sharing of Payments by Lenders.  If any Lender shall, by exercising any right of setoff or counterclaim or otherwise, obtain payment in respect of any principal of or interest on any of the Committed Loans made by it, or the participations in L/C Obligations or in Swing Line Loans held by it resulting in such Lender’s receiving payment of a proportion of the aggregate amount of such Committed Loans or participations and accrued interest thereon greater than its pro rata share thereof as provided herein, then the Lender receiving such greater proportion shall (a) notify the Administrative Agent of such fact, and (b) purchase (for cash at face value) participations in the Committed Loans and subparticipations in L/C Obligations and Swing Line Loans of the other Lenders, or make such other adjustments as shall be equitable, so that the benefit of all such payments shall be shared by the Lenders ratably in accordance with the aggregate amount of principal of and accrued interest on their respective Committed Loans and other amounts owing them, provided that:

 

(i) if any such participations or subparticipations are purchased and all or any portion of the payment giving rise thereto is recovered, such participations or subparticipations shall be rescinded and the purchase price restored to the extent of such recovery, without interest; and

 

(ii) the provisions of this Section shall not be construed to apply to (x) any payment made by the Borrower pursuant to and in accordance with the express terms of this Agreement (including the application of funds arising from the existence of a Defaulting Lender), (y) the application of Cash Collateral provided for in Section 2.16, or (z) any payment obtained by a Lender as consideration for the assignment of or sale of a participation in any of its Committed Loans or subparticipations in L/C Obligations or Swing Line Loans to any assignee or participant, other than to the Borrower or any Subsidiary thereof (as to which the provisions of this Section shall apply).

 

The Borrower consents to the foregoing and agrees, to the extent it may effectively do so under applicable law, that any Lender acquiring a participation pursuant to the foregoing arrangements may exercise against the Borrower rights of setoff and counterclaim with respect to such participation as fully as if such Lender were a direct creditor of the Borrower in the amount of such participation.

 

2.14 Extension of Maturity Date.

 

(a) Requests for Extension.  The Borrower may, by notice to the Administrative Agent (who shall promptly notify the Lenders) not less than 45 days and not more than 75 days prior to any anniversary of the Closing Date (the “Applicable Anniversary Date”), request that each Lender extend such Lender’s Maturity Date for an additional period of one year; provided that Borrower may request only two such extensions under this Agreement.

 

(b) Lender Elections to Extend.  Each Lender, acting in its sole and individual discretion, shall, by notice to the Administrative Agent given not earlier than 30 days prior to the Applicable Anniversary Date and not later than the date (the “Notice Date”) that is 20 days prior 

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to the Applicable Anniversary Date, advise the Administrative Agent whether or not such Lender agrees to such extension (and each Lender that determines not to so extend its Maturity Date (a “Non-Extending Lender”) shall notify the Administrative Agent of such fact promptly after such determination (but in any event no later than the Notice Date) and any Lender that does not so advise the Administrative Agent on or before the Notice Date shall be deemed to be a Non-Extending Lender.  The election of any Lender to agree to such extension shall not obligate any other Lender to so agree.

 

(c) Notification by Administrative Agent.  The Administrative Agent shall notify the Borrower of each Lender’s determination under this Section no later than the date 15 days prior to the Applicable Anniversary Date (or, if such date is not a Business Day, on the next preceding Business Day).

 

(d) Additional Commitment Lenders.  The Borrower shall have the right to replace each Non-Extending Lender with, and add as “Lenders” under this Agreement in place thereof, one or more Eligible Assignees (each, an “Additional Commitment Lender”) as provided in Section 10.13; provided that each of such Additional Commitment Lenders shall enter into an Assignment and Assumption pursuant to which such Additional Commitment Lender shall, effective as of the Applicable Anniversary Date, undertake a Commitment (and, if any such Additional Commitment Lender is already a Lender, its Commitment shall be in addition to such Lender’s Commitment hereunder on such date).

 

(e) Minimum Extension Requirement.  If (and only if) the total of the Commitments of the Lenders that have agreed so to extend their Maturity Date (each, an “Extending Lender”) and the additional Commitments of the Additional Commitment Lenders shall be more than 50% of the aggregate amount of the Commitments in effect immediately prior to the Applicable Anniversary Date, then, effective as of the Maturity Date in effect prior to giving effect to any such extension under this Section (such Maturity Date being called the “Existing Maturity Date”), the Maturity Date of each Extending Lender and of each Additional Commitment Lender shall be extended to the date falling on the first anniversary of the Existing Maturity Date (except that, if such date is not a Business Day, such Maturity Date as so extended shall be the next preceding Business Day) and each Additional Commitment Lender shall thereupon become a “Lender” for all purposes of this Agreement.

 

(f) Conditions to Effectiveness of Extensions.  As a condition precedent to such extension, the Borrower shall deliver to the Administrative Agent a certificate of each Loan Party dated as of the Applicable Anniversary Date (in sufficient copies for each Extending Lender and each Additional Commitment Lender) signed by a Responsible Officer of such Loan Party (i) certifying and attaching the resolutions adopted by such Loan Party approving or consenting to such extension and (ii) in the case of the Borrower, certifying that, before and after giving effect to such extension, (A) the representations and warranties contained in Article V and the other Loan Documents are true and correct in all material respects on and as of the Applicable Anniversary Date, except to the extent that such representations and warranties specifically refer to an earlier date, in which case they are true and correct as of such earlier date, and except that for purposes of this Section 2.14, the representations and warranties contained in subsections (a) and (b) of Section 5.04 shall be deemed to refer to the most recent statements furnished pursuant to subsections (a) and (b), respectively, of Section 6.01, and (B) no Event of 

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Default exists, including for the avoidance of doubt, an Event of Default arising from the Borrower’s failure to be in compliance with Section 7.04(b).  In addition, on the Maturity Date of each Non-Extending Lender, the Borrower shall prepay any Committed Loans outstanding on such date (and pay any additional amounts required pursuant to Section 3.05) to the extent necessary to keep outstanding Committed Loans ratable with any revised Applicable Percentages of the respective Lenders effective as of such date.

 

(g) Conflicting Provisions.  This Section shall supersede any provisions in Section 2.13 or 10.01 to the contrary.

 

2.15 Increase in Commitments.

 

(a) Request for Increase.  Provided no Event of Default has occurred and is continuing, upon notice to the Administrative Agent (which shall promptly notify the Lenders), the Borrower shall have the right, without the consent of the Lenders or prior approval of the Administrative Agent, to effectuate from time to time an increase in the Aggregate Commitments by sending a notice to the Administrative Agent requesting such increase; provided that no Lender’s Commitment shall be increased without the consent of such Lender.  (i) any such request for an increase shall be in a minimum amount of $5,000,000, (ii) after giving effect to such increase in the Aggregate Commitments, the Aggregate Commitments do not exceed $400,000,000, and (iii) no Lender’s Commitment shall be increased without such Lender’s prior written consent.  The Borrower may elect to request increases in the commitments of certain of the existing Lenders, or of each of the existing Lenders or, subject to the approval of the Administrative Agent, the L/C Issuer and the Swing Line Lender (which approvals shall not be unreasonably withheld), of additional Eligible Assignees as new Lenders.  In the event that the Borrower elects to request increases in the commitments of any or each of the existing Lenders, at the time of sending such notice, the Borrower (in consultation with the Administrative Agent) shall specify the time period within which each such Lender is requested to respond (which shall in no event be less than ten Business Days from the date of delivery of such notice to the Lenders).

 

(b) Lender Elections to Increase.  In the event that the Borrower so elects to request increases in the commitments of each of the existing Lenders, each Lender shall notify the Administrative Agent within such time period whether or not it agrees to increase its Commitment and, if so, whether by an amount equal to, greater than, or less than its Applicable Percentage of such requested increase.  Any Lender not responding within such time period shall be deemed to have declined to increase its Commitment.

 

(c) Notification by Administrative Agent; Additional Lenders.  The Administrative Agent shall notify the Borrower and each Lender of the Lenders’ responses to each request made hereunder.  To achieve the full amount of a requested increase and subject to the approval of the Administrative Agent, the L/C Issuer and the Swing Line Lender (which approvals shall not be unreasonably withheld), the Borrower may also invite additional Eligible Assignees to become Lenders pursuant to a joinder agreement in form and substance satisfactory to the Administrative Agent and its counsel.

 

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(d) Effective Date and Allocations.  If the Aggregate Commitments are increased in accordance with this Section, the Administrative Agent and the Borrower shall determine the effective date (the “Increase Effective Date”) and the final allocation of such increase.  The Administrative Agent shall promptly notify the Borrower and the Lenders of the final allocation of such increase and the Increase Effective Date.

 

(e) Conditions to Effectiveness of Increase.  As a condition precedent to such increase, the Borrower shall deliver to the Administrative Agent a certificate of each Loan Party dated as of the Increase Effective Date (in sufficient copies for each Lender) signed by a Responsible Officer of such Loan Party (i) certifying and attaching the resolutions adopted by such Loan Party approving or consenting to such increase, and (ii) in the case of the Borrower, certifying that, before and after giving effect to such increase, (A) the representations and warranties contained in Article V and the other Loan Documents are true and correct in all material respects on and as of the Increase Effective Date, except to the extent that such representations and warranties specifically refer to an earlier date, in which case they are true and correct as of such earlier date, and except that for purposes of this Section 2.15, the representations and warranties contained in subsections (a) and (b) of Section 5.04 shall be deemed to refer to the most recent statements furnished pursuant to clauses (a) and (b), respectively, of Section 6.01, and (B) no Event of Default has occurred and is continuing, including for the avoidance of doubt, an Event of Default arising from the Borrower’s failure to be in compliance with Section 7.04(b).  The Borrower shall prepay any Committed Loans outstanding on the Increase Effective Date (and pay any additional amounts required pursuant to Section 3.05) to the extent necessary to keep the outstanding Committed Loans ratable with any revised Applicable Percentages arising from any nonratable increase in the Commitments under this Section.

 

(f) Conflicting Provisions.  This Section shall supersede any provisions in Section 2.13 or 10.01 to the contrary.

 

2.16 Cash Collateral for L/C Issuer.     At any time that any Lender is an Impacted Lender, upon the request of the L/C Issuer to the Administrative Agent and the Borrower, the Borrower shall immediately pledge and deposit with or deliver to the Administrative Agent as collateral, for the benefit of the L/C Issuer, cash or deposit account balances, in an aggregate amount not less than such Impacted Lender’s Applicable Percentage of the then Outstanding Amount of all L/C Obligations pursuant to documentation in form and substance satisfactory to the Administrative Agent and the L/C Issuer, which arrangements and documents are hereby consented to by the Lenders.  The Borrower hereby grants to the Administrative Agent, for the benefit of the L/C Issuer a security interest in all such cash, deposit accounts and all balances therein and all proceeds of the foregoing.  Such collateral shall be maintained in blocked, non-interest bearing deposit accounts at Bank of America.  This Section and any agreements or other documents delivered in connection with this Section shall not be prohibited by, or otherwise conflict with, any contrary provision herein, including Sections 2.12, 2.13 and 7.02.

 

2.17 Defaulting Lenders.   t(a)  Adjustments.  Notwithstanding anything to the contrary contained in this Agreement, if any Lender becomes a Defaulting Lender, then, until such time as that Lender is no longer a Defaulting Lender, to the extent permitted by applicable Law:

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(i)           Waivers and Amendments.  That Defaulting Lender’s right to approve or disapprove any amendment, waiver or consent with respect to this Agreement shall be restricted as set forth in Section 10.01.

 

(ii)           Reallocation of Payments.  Any payment of principal, interest, fees or other amounts received by the Administrative Agent for the account of that Defaulting Lender (whether voluntary or mandatory, at maturity, pursuant to Article VIII or otherwise, and including any amounts made available to the Administrative Agent by that Defaulting Lender pursuant to Section 10.08), shall be applied at such time or times as may be determined by the Administrative Agent as follows: first, to the payment of any amounts owing by that Defaulting Lender to the Administrative Agent hereunder; second, to the payment on a pro rata basis of any amounts owing by that Defaulting Lender to the L/C Issuer or Swing Line Lender hereunder; third, if so determined by the Administrative Agent or requested by the L/C Issuer or Swing Line Lender, to be held as Cash Collateral for future funding obligations of that Defaulting Lender of any participation in any Swing Line Loan or Letter of Credit; fourth, as the Borrower may request (so long as no Default or Event of Default exists), to the funding of any Loan in respect of which that Defaulting Lender has failed to fund its portion thereof as required by this Agreement, as determined by the Administrative Agent; fifth, if so determined by the Administrative Agent and the Borrower, to be held in a non-interest bearing deposit account and released in order to satisfy obligations of that Defaulting Lender to fund Loans under this Agreement; sixth, to the payment of any amounts owing to the Lenders, the L/C Issuer or Swing Line Lender as a result of any judgment of a court of competent jurisdiction obtained by any Lender, the L/C Issuer or Swing Line Lender against that Defaulting Lender as a result of that Defaulting Lender’s breach of its obligations under this Agreement; seventh, so long as no Default or Event of Default exists, to the payment of any amounts owing to the Borrower as a result of any judgment of a court of competent jurisdiction obtained by the Borrower against that Defaulting Lender as a result of that Defaulting Lender’s breach of its obligations under this Agreement; and eighth, to that Defaulting Lender or as otherwise directed by a court of competent jurisdiction; provided that if (x) such payment is a payment of the principal amount of any Loans or L/C Borrowings in respect of which that Defaulting Lender has not fully funded its appropriate share and (y) such Loans or L/C Borrowings were made at a time when the conditions set forth in Section 4.02 were satisfied or waived, such payment shall be applied solely to pay the Loans of, and L/C Borrowings owed to, all non-Defaulting Lenders on a pro rata basis prior to being applied to the payment of any Loans of, or L/C Borrowings owed to, that Defaulting Lender.  Any payments, prepayments or other amounts paid or payable to a Defaulting Lender that are applied (or held) to pay amounts owed by a Defaulting Lender or to post Cash Collateral pursuant to this Section 2.17(a)(ii) shall be deemed paid to and redirected by that Defaulting Lender, and each Lender irrevocably consents hereto.

 

(iii)           Certain Fees.  That Defaulting Lender (x) shall not be entitled to receive any commitment fee pursuant to Section 2.09(a) for any period during which that Lender is a Defaulting Lender (and the Borrower shall (A) be required to pay to each of the L/C Issuer and the Swing Line Lender, as applicable, the amount of such fee allocable to its Fronting Exposure arising from that Defaulting Lender and (B) not be required to pay the remaining amount of such fee that otherwise would have been required to have been paid to that Defaulting Lender) and (y) shall be limited in its right to receive Letter of Credit Fees as provided in Section 2.03(i).

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(iv)           Reallocation of Applicable Percentages to Reduce Fronting Exposure.  During any period in which there is a Defaulting Lender, for purposes of computing the amount of the obligation of each non-Defaulting Lender to acquire, refinance or fund participations in Letters of Credit or Swing Line Loans pursuant to Sections 2.03 and 2.04, the “Applicable Percentage” of each non-Defaulting Lender shall be computed without giving effect to the Commitment of that Defaulting Lender; provided, that, (i) each such reallocation shall be given effect only if, at the date of any such reallocation, no Default or Event of Default exists; and (ii) immediately before and after giving effect to such reallocation, the aggregate obligation of each non-Defaulting Lender to acquire, refinance or fund participations in Letters of Credit and Swing Line Loans shall not exceed the positive difference, if any, of (1) the Commitment of that non-Defaulting Lender minus (2) the aggregate Outstanding Amount of the Committed Loans of that Lender.

 

(b)           Defaulting Lender Cure.  If the Borrower, the Administrative Agent, Swing Line Lender and the L/C Issuer agree in writing in their sole discretion that a Defaulting Lender should no longer be deemed to be a Defaulting Lender, the Administrative Agent will so notify the parties hereto, whereupon as of the effective date specified in such notice and subject to any conditions set forth therein (which may include arrangements with respect to any Cash Collateral), that Lender will, to the extent applicable, purchase that portion of outstanding Loans of the other Lenders or take such other actions as the Administrative Agent may determine to be necessary to cause the Committed Loans and funded and unfunded participations in Letters of Credit and Swing Line Loans to be held on a pro rata basis by the Lenders in accordance with their Applicable Percentages (without giving effect to Section 2.17(a)(iv)), whereupon that Lender will cease to be a Defaulting Lender; provided that no adjustments will be made retroactively with respect to fees accrued or payments made by or on behalf of the Borrower while that Lender was a Defaulting Lender; and provided, further, that except to the extent otherwise expressly agreed by the affected parties, no change hereunder from Defaulting Lender to Lender will constitute a waiver or release of any claim of any party hereunder arising from that Lender’s having been a Defaulting Lender.

 

 

 

                        ARTICLE III.                                

 

TAXES, YIELD PROTECTION AND ILLEGALITY

 

3.01 Taxes.

 

(a) Payments Free of Taxes.  Any and all payments by or on account of any obligation of the Borrower hereunder or under any other Loan Document shall be made free and clear of and without reduction or withholding for any Indemnified Taxes or Other Taxes, provided that if the Borrower shall be required by applicable law to deduct any Indemnified Taxes (including any Other Taxes) from such payments, then (i) the sum payable shall be increased as necessary so that after making all required deductions (including deductions applicable to additional sums payable under this Section) the Administrative Agent, Lender or L/C Issuer, as the case may be, receives an amount equal to the sum it would have received had no such deductions been made, 

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(ii) the Borrower shall make such deductions and (iii) the Borrower shall timely pay the full amount deducted to the relevant Governmental Authority in accordance with applicable law.

 

(b) Payment of Other Taxes by the Borrower.  Without limiting the provisions of subsection (a) above, the Borrower shall timely pay any Other Taxes to the relevant Governmental Authority in accordance with applicable law.

 

(c) Indemnification by the Borrower.  The Borrower shall indemnify the Administrative Agent, each Lender and the L/C Issuer and shall make payment in respect therof, within 10 days after demand therefor, for the full amount of any Indemnified Taxes or Other Taxes (including Indemnified Taxes or Other Taxes imposed or asserted on or attributable to amounts payable under this Section) paid by the Administrative Agent, such Lender or the L/C Issuer, as the case may be, on or with respect to any payment by or on account of any obligations of the Borrower hereunder and any penalties, interest and reasonable expenses arising therefrom or with respect thereto, whether or not such Indemnified Taxes or Other Taxes were correctly or legally imposed or asserted by the relevant Governmental Authority.  If requested by the Borrower, a certificate as to the amount of such payment or liability in reasonable detail shall be delivered to the Borrower by a Lender or the L/C Issuer (with a copy to the Administrative Agent), or by the Administrative Agent on its own behalf or on behalf of a Lender or the L/C Issuer.

 

(d) Evidence of Payments.  As soon as practicable after any payment of Indemnified Taxes or Other Taxes by the Borrower to a Governmental Authority, the Borrower shall deliver to the Administrative Agent the original or a certified copy of a receipt issued by such Governmental Authority evidencing such payment, a copy of the return reporting such payment or other evidence of such payment reasonably satisfactory to the Administrative Agent.

 

(e) Status of Lenders.  Any Foreign Lender that is entitled to an exemption from or reduction of withholding tax under the law of the jurisdiction in which the Borrower is resident for tax purposes, or any treaty to which such jurisdiction is a party, with respect to payments hereunder or under any other Loan Document shall deliver to the Borrower (with a copy to the Administrative Agent), at the time or times prescribed by applicable law or reasonably requested by the Borrower or the Administrative Agent, such properly completed and executed documentation prescribed by applicable law as will permit such payments to be made without withholding or at a reduced rate of withholding.  In addition, any Lender, if requested by the Borrower or the Administrative Agent, shall deliver such other documentation prescribed by applicable law or reasonably requested by the Borrower or the Administrative Agent as will enable the Borrower or the Administrative Agent to determine whether or not such Lender is subject to backup withholding or information reporting requirements.

 

Without limiting the generality of the foregoing, in the event that the Borrower is resident for tax purposes in the United States, any Foreign Lender shall deliver to the Borrower and the Administrative Agent (in such number of copies as shall be requested by the recipient) on or prior to the date on which such Foreign Lender becomes a Lender under this Agreement (and from time to time thereafter upon the request of the Borrower or the Administrative Agent, but only if such Foreign Lender is legally entitled to do so), whichever of the following is applicable:

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(i) duly completed copies of Internal Revenue Service Form W-8BEN claiming eligibility for benefits of an income tax treaty to which the United States is a party,

 

(ii) duly completed copies of Internal Revenue Service Form W-8ECI,

 

(iii) in the case of a Foreign Lender claiming the benefits of the exemption for portfolio interest under section 881(c) of the Code, (x) a certificate to the effect that such Foreign Lender is not (A) a “bank” within the meaning of section 881(c)(3)(A) of the Code, (B) a “10 percent shareholder” of the Borrower within the meaning of section 881(c)(3)(B) of the Code, or (C) a “controlled foreign corporation” described in section 881(c)(3)(C) of the Code and (y) duly completed copies of Internal Revenue Service Form W-8BEN, or

 

(iv) any other form prescribed by applicable law as a basis for claiming exemption from or a reduction in United States Federal withholding tax duly completed together with such supplementary documentation as may be prescribed by applicable law to permit the Borrower to determine the withholding or deduction required to be made.

 

If a payment made to a Lender under any Loan Document would be subject to U.S. federal withholding Tax imposed by FATCA if such Lender were to fail to comply with the applicable reporting requirements of FATCA (including those contained in Section 1471(b) or 1472(b) of the Code, as applicable), such Lender shall deliver to a Loan Party at the time or times prescribed by law and at such time or times reasonably requested by such Loan Party such documentation prescribed by applicable law (including as prescribed by Section 1471(b)(3)(C)(i) of the Code) and such additional documentation reasonably requested by the Loan Party as may be necessary for the Loan Party to comply with their obligations under FATCA and to determine that such Lender has complied with such Lender’s obligations under FATCA or to determine the amount to deduct and withhold from such payment.

 

(f) Treatment of Certain Refunds.  Upon the Borrower’s written request, the Administrative Agent, L/C Issuer and each Lender shall use reasonable efforts to make any filings necessary to obtain any refund, deduction or credit of any Taxes or Other Taxes as to which the Borrower has indemnified it or with respect to which the Borrower has paid additional amounts pursuant to this Section 3.01.  If the Administrative Agent, any Lender or the L/C Issuer determines, in its sole discretion, that it has received a material refund of any Taxes or Other Taxes as to which it has been indemnified by the Borrower or with respect to which the Borrower has paid additional amounts pursuant to this Section, it shall pay to the Borrower an amount equal to such refund (but only to the extent of indemnity payments made, or additional amounts paid, by the Borrower under this Section with respect to the Taxes or Other Taxes giving rise to such refund), net of all reasonable out-of-pocket expenses of the Administrative Agent, such Lender or the L/C Issuer, as the case may be, and without interest (other than any interest paid by the relevant Governmental Authority with respect to such refund), provided that the Borrower, upon the request of the Administrative Agent, such Lender or the L/C Issuer, agrees to repay the amount paid over to the Borrower (plus any penalties, interest or other charges imposed by the relevant Governmental Authority) to the Administrative Agent, such Lender or the L/C Issuer in the event the Administrative Agent, such Lender or the L/C Issuer is 

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required to repay such refund to such Governmental Authority.  This subsection shall not be construed to require the Administrative Agent, any Lender or the L/C Issuer to make available its tax returns (or any other information relating to its taxes that it deems confidential) to the Borrower or any other Person or to attempt to take any position to obtain a refund, deduction, or credit, which attempt would be inconsistent with any reporting position otherwise taken by the Administrative Agent or such Lender or the L/C Issuer on its applicable tax returns.

 

3.02 Illegality.  If any Lender determines that any Law has made it unlawful, or that any Governmental Authority has asserted that it is unlawful, for any Lender or its applicable Lending Office to make, maintain or fund Eurodollar Rate Loans, or to determine or charge interest rates based upon the Eurodollar Rate, or any Governmental Authority has imposed material restrictions on the authority of such Lender to purchase or sell, or to take deposits of, Dollars in the London interbank market, then, on notice thereof by such Lender to the Borrower through the Administrative Agent, any obligation of such Lender to make or continue Eurodollar Rate Loans or to convert Base Rate Committed Loans to Eurodollar Rate Loans shall be suspended until such Lender notifies the Administrative Agent and the Borrower that the circumstances giving rise to such determination no longer exist.  Upon receipt of such notice, the Borrower shall, upon demand from such Lender (with a copy to the Administrative Agent), prepay or, if applicable, convert all Eurodollar Rate Loans of such Lender to Base Rate Loans, either on the last day of the Interest Period therefor, if such Lender may lawfully continue to maintain such Eurodollar Rate Loans to such day, or immediately, if such Lender may not lawfully continue to maintain such Eurodollar Rate Loans.  Upon any such prepayment or conversion, the Borrower shall also pay accrued interest on the amount so prepaid or converted.

 

3.03 Inability to Determine Rates.  If the Required Lenders determine that for any reason in connection with any request for a Eurodollar Rate Loan or a conversion to or continuation thereof that (a) Dollar deposits are not being offered to banks in the London interbank eurodollar market for the applicable amount and Interest Period of such Eurodollar Rate Loan, (b) adequate and reasonable means do not exist for determining the Eurodollar Rate for any requested Interest Period with respect to a proposed Eurodollar Rate Loan, or (c) the Eurodollar Rate for any requested Interest Period with respect to a proposed Eurodollar Rate Loan does not adequately and fairly reflect the cost to such Lenders of funding such Loan, the Administrative Agent will promptly so notify the Borrower and each Lender.  Thereafter, the obligation of the Lenders to make or maintain Eurodollar Rate Loans shall be suspended until the Administrative Agent (upon the instruction of the Required Lenders) revokes such notice.  Upon receipt of such notice, the Borrower may revoke any pending request for a Borrowing of, conversion to or continuation of Eurodollar Rate Loans or, failing that, will be deemed to have converted such request into a request for a Committed Borrowing of Base Rate Loans in the amount specified therein.

 

3.04 Increased Costs; Reserves on Eurodollar Rate Loans.

 

(a) Increased Costs Generally.  If any Change in Law shall:

 

(i) impose, modify or deem applicable any reserve, special deposit, compulsory loan, insurance charge or similar requirement against assets of, deposits with or for the account of, or credit extended or participated in by, any Lender (except any reserve requirement contemplated by Section 3.04(e)) or the L/C Issuer;

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(ii) subject any Lender or the L/C Issuer to any tax of any kind whatsoever with respect to this Agreement, any Letter of Credit, any participation in a Letter of Credit or any Eurodollar Rate Loan made by it, or change the basis of taxation of payments to such Lender or the L/C Issuer in respect thereof (except for Indemnified Taxes or Other Taxes covered by Section 3.01 and the imposition of, or any change in the rate of, any Excluded Tax payable by such Lender or the L/C Issuer); or

 

(iii) impose on any Lender or the L/C Issuer or the London interbank market any other condition, cost or expense affecting this Agreement or Eurodollar Rate Loans made by such Lender or any Letter of Credit or participation therein;

 

and the result of any of the foregoing shall be to increase the cost to such Lender of making or maintaining any Eurodollar Rate Loan (or of maintaining its obligation to make any such Loan), or to increase the cost to such Lender or the L/C Issuer of participating in, issuing or maintaining any Letter of Credit (or of maintaining its obligation to participate in or to issue any Letter of Credit), or to reduce the amount of any sum received or receivable by such Lender or the L/C Issuer hereunder (whether of principal, interest or any other amount) then, upon delivery by such Lender or the L/C Issuer of a certificate pursuant to Section 3.04(c), the Borrower will, pursuant to Section 3.04(c), pay to such Lender or the L/C Issuer, as the case may be, such additional amount or amounts as will compensate such Lender or the L/C Issuer, as the case may be, for such additional costs incurred or reduction suffered.

 

(b) Capital Requirements.  If any Lender or the L/C Issuer determines that any Change in Law affecting such Lender or the L/C Issuer or any Lending Office of such Lender or such Lender’s or the L/C Issuer’s holding company, if any, regarding capital requirements or liquidity requirements has or would have the effect of reducing the rate of return on such Lender’s or the L/C Issuer’s capital or on the capital of such Lender’s or the L/C Issuer’s holding company, if any, as a consequence of this Agreement, the Commitments of such Lender or the Loans made by, or participations in Letters of Credit held by, such Lender, or the Letters of Credit issued by the L/C Issuer, to a level below that which such Lender or the L/C Issuer or such Lender’s or the L/C Issuer’s holding company could have achieved but for such Change in Law (taking into consideration such Lender’s or the L/C Issuer’s policies and the policies of such Lender’s or the L/C Issuer’s holding company with respect to capital adequacy), then from time to time the Borrower will pay to such Lender or the L/C Issuer, as the case may be, such additional amount or amounts as will compensate such Lender or the L/C Issuer or such Lender’s or the L/C Issuer’s holding company for any such reduction suffered.

 

(c) Certificates for Reimbursement.  A certificate of a Lender or the L/C Issuer setting forth in reasonable detail the amount or amounts necessary to compensate such Lender or the L/C Issuer or its holding company, as the case may be, as specified in subsection (a) or (b) of this Section and delivered to the Borrower shall be conclusive absent manifest error.  The Borrower shall pay such Lender or the L/C Issuer, as the case may be, the amount shown as due on any such certificate within 10 days after receipt thereof.

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(d) Delay in Requests.  Failure or delay on the part of any Lender or the L/C Issuer to demand compensation pursuant to the foregoing provisions of this Section shall not constitute a waiver of such Lender’s or the L/C Issuer’s right to demand such compensation, provided that the Borrower shall not be required to compensate a Lender or the L/C Issuer pursuant to the foregoing provisions of this Section for any increased costs incurred or reductions suffered more than nine months prior to the date that such Lender or the L/C Issuer, as the case may be, notifies the Borrower of the Change in Law giving rise to such increased costs or reductions and of such Lender’s or the L/C Issuer’s intention to claim compensation therefor (except that, if the Change in Law giving rise to such increased costs or reductions is retroactive, then the nine-month period referred to above shall be extended to include the period of retroactive effect thereof).

 

(e) Reserves on Eurodollar Rate Loans.  The Borrower shall pay to each Lender, as long as such Lender shall be required to maintain reserves with respect to liabilities or assets consisting of or including Eurocurrency funds or deposits (currently known as “Eurocurrency liabilities”), additional interest on the unpaid principal amount of each Eurodollar Rate Loan equal to the actual costs of such reserves allocated to such Loan by such Lender (as determined by such Lender in good faith, which determination shall be conclusive), which shall be due and payable on each date on which interest is payable on such Loan, provided the Borrower shall have received at least 10 days’ prior notice (with a copy to the Administrative Agent) of such additional interest from such Lender.  If a Lender fails to give notice 10 days prior to the relevant Interest Payment Date, such additional interest shall be due and payable 10 days from receipt of such notice.

 

3.05 Compensation for Losses.  Upon demand of any Lender (with a copy to the Administrative Agent) from time to time, the Borrower shall promptly compensate such Lender for and hold such Lender harmless from any loss, cost or expense incurred by it as a result of:

 

(a) any continuation, conversion, payment or prepayment of any Loan other than a Base Rate Loan on a day other than the last day of the Interest Period for such Loan (whether voluntary, mandatory, automatic, by reason of acceleration, or otherwise);

 

(b) any failure by the Borrower (for a reason other than the failure of such Lender to make a Loan) to prepay, borrow, continue or convert any Loan other than a Base Rate Loan on the date or in the amount notified by the Borrower; or

 

(c) any assignment of a Eurodollar Rate Loan on a day other than the last day of the Interest Period therefor as a result of a request by the Borrower pursuant to Section 10.13; including any loss of anticipated profits and any loss or expense arising from the liquidation or reemployment of funds obtained by it to maintain such Loan or from fees payable to terminate the deposits from which such funds were obtained.  The Borrower shall also pay any customary administrative fees charged by such Lender in connection with the foregoing.

 

For purposes of calculating amounts payable by the Borrower to the Lenders under this Section 3.05, each Lender shall be deemed to have funded each Eurodollar Rate Loan made by it at the Eurodollar Rate for such Loan by a matching deposit or other borrowing in the London interbank eurodollar market for a comparable amount and for a comparable period, whether or not such Eurodollar Rate Loan was in fact so funded.

 

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3.06 Mitigation Obligations; Replacement of Lenders.

 

(a) Designation of a Different Lending Office.  If any Lender requests compensation under Section 3.04, or the Borrower is required to pay any additional amount to any Lender or any Governmental Authority for the account of any Lender pursuant to Section 3.01, or if any Lender gives a notice pursuant to Section 3.02, then such Lender shall use reasonable efforts to designate a different Lending Office for funding or booking its Loans hereunder or to assign its rights and obligations hereunder to another of its offices, branches or affiliates, if, in the judgment of such Lender, such designation or assignment (i) would eliminate or reduce amounts payable pursuant to Section 3.01 or 3.04, as the case may be, in the future, or eliminate the need for the notice pursuant to Section 3.02, as applicable, and (ii) in each case, would not subject such Lender to any unreimbursed cost or expense and would not otherwise be disadvantageous to such Lender.  The Borrower hereby agrees to pay all reasonable costs and expenses incurred by any Lender in connection with any such designation or assignment.

 

(b) Replacement of Lenders.  If any Lender requests compensation under Section 3.04, or if the Borrower is required to pay any additional amount to any Lender or any Governmental Authority for the account of any Lender pursuant to Section 3.01, or if any Lender gives a notice pursuant to Section 3.02, the Borrower may replace such Lender in accordance with Section 10.13.

 

3.07 Survival.  All of the Borrower’s obligations under this Article III shall survive termination of the Aggregate Commitments and repayment of all other Obligations hereunder.

 

                           ARTICLE IV.                                

 

CONDITIONS PRECEDENT TO CREDIT EXTENSIONS

 

4.01 Conditions of Effectiveness.  The effectiveness of this Agreement is subject to satisfaction (or waiver in accordance with Section 10.02) of the following conditions precedent:

 

(a) The Administrative Agent’s (or its counsel’s) receipt of the following, each of which shall be originals or telecopies (followed promptly by originals) unless otherwise specified, each properly executed by a Responsible Officer of the signing Loan Party, each dated the Closing Date (or, in the case of certificates of governmental officials, a recent date before the Closing Date) and each in form and substance reasonably satisfactory to the Administrative Agent and each of the Lenders:

 

(i) executed counterparts of this Agreement and the First Amendment to Guaranty, sufficient in number for distribution to the Administrative Agent, each Lender and the Borrower;

 

(ii) a Note executed by the Borrower in favor of each Lender requesting a Note;

 

(iii) such certificates of resolutions or other action, incumbency certificates and/or other certificates of Responsible Officers of each Loan Party as the Administrative Agent may reasonably require evidencing the identity, authority and capacity 

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of each Responsible Officer thereof authorized to act as a Responsible Officer in connection with this Agreement and the other Loan Documents to which such Loan Party is a party;

 

(iv) such documents and certifications as the Administrative Agent or its counsel may reasonably require relating to the organization, existence and good standing of each Loan Party and the General Partner and any other legal matters relating to the Borrower, each other Loan Party, the General Partner, this Agreement and the other Loan Documents, all in form and substance reasonably satisfactory to the Administrative Agent and its counsel;

 

(v) favorable opinion of any general counsel, associate general counsel or corporate secretary of the General Partner or a wholly owned subsidiary of Pioneer acting as counsel for the Borrower, and of Thompson & Knight LLP, outside counsel for the Loan Parties, addressed to the Administrative Agent and each Lender, covering those matters described in Exhibit G and such other matters concerning the Loan Parties and the Loan Documents as the Required Lenders may reasonably request;

 

(vi) a certificate of a Responsible Officer of each Loan Party either (A) attaching copies of all consents, licenses and approvals required in connection with the execution, delivery and performance by such Loan Party and the validity against such Loan Party of the Loan Documents to which it is a party, and such consents, licenses and approvals shall be in full force and effect, or (B) stating that no such consents, licenses or approvals are so required;

 

(vii) a certificate signed by a Responsible Officer of the General Partner certifying (A) that the conditions specified in Sections 4.02(a) and (b) have been satisfied, and (B) that there has been no event or circumstance since the date of the Audited Financial Statements that has had or could be reasonably expected to have, either individually or in the aggregate, a Material Adverse Effect;

 

(viii) evidence that all insurance required to be maintained on behalf of and for the benefit of the Loan Parties pursuant to the Loan Documents has been obtained and is in effect; and

 

(ix) a certificate dated as of the Closing Date substantially in the form of Exhibit H hereto duly executed by the General Partner.

 

(b) The Administrative Agent, Lenders and Co-Arrangers shall have received all fees and other amounts due and payable on or prior to the Closing Date, including, to the extent invoiced prior to or on the Closing Date, reimbursement or payment of all out-of-pocket expenses required to be reimbursed or paid by the Borrower hereunder (including all such fees, charges and disbursements of counsel to the Administrative Agent, paid directly to such counsel if requested by the Administrative Agent).

 

(c) The Closing Date shall have occurred on or before March 29, 2012.

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(d) There shall not have occurred a material adverse change in the operations, business, assets, or financial condition of the Borrower and the Restricted Subsidiaries, taken as a whole, since December 31, 2011.

 

Without limiting the generality of the provisions of the last paragraph of Section 9.03, for purposes of determining compliance with the conditions specified in this Section 4.01, each Lender that has signed this Agreement shall be deemed to have consented to, approved or accepted or to be satisfied with, each document or other matter required thereunder to be consented to or approved by or acceptable or satisfactory to a Lender unless the Administrative Agent shall have received notice from such Lender prior to the proposed Closing Date specifying its objection thereto.

 

4.02 Conditions to all Credit Extensions.  The obligation of each Lender to honor any Request for Credit Extension (other than a Committed Loan Notice requesting only a conversion of Committed Loans to the other Type, or a continuation of Eurodollar Rate Loans) is subject to the following conditions precedent:

 

(a) The representations and warranties of the Borrower and each other Loan Party contained in Article V or any other Loan Document, or which are contained in any document furnished at any time under or in connection herewith or therewith, shall be true and correct in all material respects on and as of the date of such Credit Extension, except to the extent that such representations and warranties specifically refer to an earlier date, in which case they shall be true and correct as of such earlier date, and except that for purposes of this Section 4.02, the representations and warranties contained in subsections (a) and (b) of Section 5.04 shall be deemed to refer to the most recent statements furnished pursuant to clauses (a) and (b), respectively, of Section 6.01.

 

(b) No Default shall have occurred and be continuing, or would result from such proposed Credit Extension or from the application of the proceeds thereof (including, for the sake of clarity, a Default arising from the Borrower’s failure to be in compliance with Section 7.04(b) as of the date of, and immediately after giving effect to, such Credit Extension).

 

(c) The Administrative Agent and, if applicable, the L/C Issuer or the Swing Line Lender shall have received a Request for Credit Extension in accordance with the requirements hereof.

 

Each Request for Credit Extension (other than a Committed Loan Notice requesting only a conversion of Committed Loans to the other Type or a continuation of Eurodollar Rate Loans) submitted by the Borrower shall be deemed to be a representation and warranty that the conditions specified in Sections 4.02(a) and (b) have been satisfied on and as of the date of the applicable Credit Extension.

 

                         ARTICLE V.                                

 

REPRESENTATIONS AND WARRANTIES

 

The Borrower represents and warrants to the Administrative Agent and the Lenders that as of the Closing Date, each date specified in Sections 2.14, 2.15 and 4.02, and, in the case of the representations and warranties set forth in Sections 5.01 and 5.02 solely with respect to the Borrower and this Agreement, as of the date hereof:

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5.01 Organization; Powers.  Each of the Borrower and its Restricted Subsidiaries is duly organized, validly existing and in good standing under the laws of the jurisdiction of its organization, has all requisite power and authority to carry on its business as now conducted and, except where the failure to do so, individually or in the aggregate, could not reasonably be expected to result in a Material Adverse Effect, is qualified to do business in, and is in good standing in, every jurisdiction where such qualification is required.

 

5.02 Authorization; Enforceability.  The execution, delivery and performance of each Loan Party of each Loan Document to which such Person is a Party are within each Loan Party’s corporate, limited liability company or partnership powers and have been duly authorized by all necessary corporate and, if required, stockholder, member or partnership action.  This Agreement and all Guaranties have been duly executed and delivered by the Loan Party, which is a party thereto, and constitute a legal, valid and binding obligation of such Loan Party, enforceable in accordance with their terms, subject to applicable bankruptcy, insolvency, reorganization, moratorium or other laws affecting creditors’ rights generally and subject to general principles of equity, regardless of whether considered in a proceeding in equity or at law.

 

5.03 Governmental Approvals; No Conflicts.  The execution, delivery and performance of each Loan Party of each Loan Document to which such Person is a Party (a) do not violate the charter, by-laws or other organizational documents of the Borrower or any of its Restricted Subsidiaries or (b) except as to matters that could not reasonably be expected to result in a Material Adverse Effect, (i) do not require any consent or approval of, registration or filing with, or any other action by, any Governmental Authority or any other Person, except such as have been obtained or made and are in full force and effect, (ii) will not violate any applicable law or regulation or any order of any Governmental Authority, (iii) will not violate or result in a default under any indenture, agreement or other instrument binding upon the Borrower or any of its Restricted Subsidiaries or its assets, or give rise to a right thereunder to require any payment to be made by the Borrower or any of its Restricted Subsidiaries, and (iv) will not result in the creation or imposition of any Lien on any asset of the Borrower or any of its Restricted Subsidiaries.

 

5.04 Financial Statements; No Material Adverse Effect.  (a)  The Borrower has heretofore furnished to the Lenders true, correct and complete copies of the Audited Financial Statements, as of and for the fiscal year ended December 31, 2011, reported on by Ernst & Young LLP, independent public accountants.  Such financial statements present fairly, in all material respects, the financial position and results of operations and cash flows of the predecessor to the Borrower and its Consolidated Subsidiaries on a consolidated basis as of such dates and for such periods in accordance with GAAP consistently applied throughout the period covered thereby, except as otherwise expressly noted therein.

 

(b) Any unaudited financial statements delivered pursuant to Section 6.02(b) with respect to which this representation is deemed to be made present fairly, in all material respects, the financial position and results of operations and cash flows of the Borrower and its Consolidated Subsidiaries, on a consolidated basis as of such dates 

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and for such periods in accordance with GAAP consistently applied throughout the period covered thereby, subject to the absence of footnotes and to normal year-end audit adjustments.

 

(c) Since the date of the Audited Financial Statements, there has been no material adverse change in the operations, business, assets, or financial condition of the Borrower and its Restricted Subsidiaries, taken as a whole.

 

5.05 Properties.  Each of the Borrower and its Restricted Subsidiaries has good title to, or valid leasehold interests in, all its real and personal property material to its business, except for any failure, defect or other matter that could not, in the aggregate, reasonably be expected to have a Material Adverse Effect.  Except for such acts or failures to act as could not be reasonably expected to have a Material Adverse Effect, all of the material properties of the Borrower and its Restricted Subsidiaries have been maintained, operated and developed in a good and workmanlike manner in accordance with prudent industry standards and in conformity with all applicable Laws.  The property of the Borrower and its Restricted Subsidiaries is subject to no Liens, other than Liens permitted by Section 7.02.

 

5.06 Litigation and Environmental Matters.  (a)  There are no actions, suits or proceedings by or before any arbitrator or Governmental Authority pending against or, to the knowledge of the Borrower, threatened in any court, in arbitration or before any Governmental Authority, by or against or affecting the Borrower or any of its Subsidiaries, taken as a whole, that could reasonably be expected, individually or in the aggregate, to result in a Material Adverse Effect (other than the Disclosed Matters) or, as of the Closing Date, that purport to affect or pertain to this Agreement or any other Loan Document.

 

(b) Except for the Disclosed Matters and except with respect to any other matters that, individually or in the aggregate, could not reasonably be expected to result in a Material Adverse Effect, neither the Borrower nor any of its Subsidiaries (i) has failed to comply with any Environmental Law or to obtain, maintain or comply with any permit, license or other approval required under any Environmental Law, (ii) has become subject to any Environmental Liability, (iii) has received notice of any claim with respect to any Environmental Liability or (iv) knows of any basis for any Environmental Liability.

 

5.07 Compliance with Laws; No Default.  Each of the Borrower and its Restricted Subsidiaries is in compliance with all laws, regulations and orders of any Governmental Authority applicable to it or its property except where the failure to do so, individually or in the aggregate, could not reasonably be expected to result in a Material Adverse Effect.  No Default has occurred and is continuing, including for the avoidance of doubt, a Default arising from the Borrower’s failure to be in compliance with Section 7.04(b).

 

5.08 Investment Company Status.  Neither the Borrower nor any of its Subsidiaries is an “investment company” as defined in, or subject to regulation under, the Investment Company Act of 1940.

 

5.09 Taxes.  Each of the Borrower and its Restricted Subsidiaries has timely filed or caused to be filed all Tax returns and reports required to have been filed and has paid or caused to be paid all Taxes required to have been paid by it, except (a) Taxes for which the Borrower or 

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such Restricted Subsidiary, as applicable, has set aside on its books adequate reserves including, Taxes that are being contested in good faith by appropriate proceedings or (b) to the extent that the failure to do so could not reasonably be expected to result in a Material Adverse Effect.

 

5.10 ERISA.  No ERISA Event has occurred or is reasonably expected to occur that, when taken together with all other such ERISA Events for which liability is reasonably expected to occur, could reasonably be expected to result in a Material Adverse Effect.  The Borrower and each ERISA Affiliate has fulfilled its obligations under the minimum funding standards of ERISA and the Code with respect to each Plan and is in compliance in all material respects with the presently applicable provisions of ERISA and the Code with respect to each Plan.  Neither the Borrower nor any ERISA Affiliate has (a) sought a waiver of the minimum funding standard under Section 412 of the Code in respect of any Plan, (b) failed to make any contribution or payment to any Plan or Multiemployer Plan, or made any amendment to any Plan that has resulted or could result in the imposition of a Lien or the posting of a bond or other security under ERISA or the Code, or (c) incurred any liability under Title IV of ERISA other than a liability to the PBGC for premiums under Section 4007 of ERISA that are not past due.

 

5.11 Disclosure.  The information furnished by or on behalf of the Borrower to the Administrative Agent or any Lender in connection with the negotiation of this Agreement or delivered hereunder (as modified or supplemented by other information so furnished), taken as a whole, contains no material misstatement of fact nor omits to state any material fact necessary to make the statements therein, in the light of the circumstances under which they were made, not materially misleading; provided that, with respect to projected financial information, the Borrower represents only that such information was prepared in good faith based upon assumptions believed to be reasonable at the time.

 

5.12 Subsidiaries; Equity Interests.  As of the Closing Date and at the time that any financial statements are delivered pursuant to Section 6.01(a) or (b), the Borrower has no Subsidiaries, including Unrestricted Subsidiaries, other than those specifically disclosed in Part (a) of Schedule 5.12 or in writing on or prior to the date such financial statements are delivered pursuant to Section 6.01(a) or (b), and all of the outstanding common Equity Interests in such Subsidiaries have been validly issued, are fully paid and nonassessable and are owned by a Loan Party in the amounts specified on Part (a) of Schedule 5.12 or in such writings free and clear of all Liens.  As of the Closing Date and at the time that any financial statements are delivered pursuant to Section 6.01(a) or (b), the Borrower has no equity investments in any other corporation or entity, other than those specifically disclosed in Part (b) of Schedule 5.12 or in writing on or prior to the date such financial statements are delivered pursuant to Section 6.01(a) or (b).  All of the outstanding common Equity Interests in the Borrower have been validly issued and are fully paid and nonassessable.

 

5.13 Insurance.  The properties of the Borrower and its Restricted Subsidiaries are insured with financially sound and reputable insurance companies who are not Affiliates of the Borrower, in such amounts, with such deductibles and covering such risks as are customarily carried by companies engaged in similar businesses and owning similar properties in localities where the Borrower or the applicable Subsidiary operates.

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5.14 Gas Imbalances, Prepayments.  As of the Closing Date and at the time that each Reserve Report is delivered pursuant to Section 6.02(d), except as set forth in Schedule 5.14 or as disclosed in writing to the Administrative Agent on or prior to the date such Reserve Report is delivered, on a net basis there are no gas imbalance, take or pay or other prepayments which would require the Borrower or any of its Restricted Subsidiaries to deliver, in the aggregate, five percent (5%) or more of the monthly production from Hydrocarbons produced from the Oil and Gas Properties at some future time without then or thereafter receiving full payment therefor.

 

5.15 Marketing of Production.  As of the Closing Date and at the time that each Reserve Report is delivered pursuant to Section 6.02(d), except for the contracts set forth in Schedule 5.15 or as disclosed in writing to the Administrative Agent on or prior to the date such Reserve Report is delivered, no material agreements exist (other than Swap Contracts permitted under Section 7.06) which are not cancelable on 60 days’ notice or less without penalty or detriment for the sale of production from the Borrower’s or its Restricted Subsidiaries’ Hydrocarbons (including, without limitation, calls on or other rights to purchase production, whether or not the same are currently being exercised) that (a) pertain to the sale of production at a fixed price and (b) have a maturity or expiry date of more than twelve months.

 

5.16 Swap Contracts.  As of the Closing Date, the annual report of the Borrower on form 10K most recently filed prior to the Closing Date sets forth true and complete information summarizing the notional volumes, prices and terms of all hedging arrangements of the Borrower and each of its Restricted Subsidiaries and all credit support relating thereto (including any margin required or supplied).

 

5.17 Solvency.  As of the Closing Date, (a) the aggregate assets (after giving effect to amounts that could reasonably be received by reason of indemnity, offset, insurance or any similar arrangement), at a fair valuation, of the Borrower and its Restricted Subsidiaries, taken as a whole will exceed the aggregate Debt of the Borrower and its Restricted Subsidiaries on a consolidated basis, as the Debt becomes absolute and matures, (b) each of the Borrower and its Restricted Subsidiaries will not have incurred or intended to incur Debt beyond its ability to pay such Debt (after taking into account the timing and amounts of cash to be received by each of the Borrower and its Restricted Subsidiaries and the amounts to be payable on or in respect of its liabilities, and giving effect to amounts that could reasonably be received by reason of indemnity, offset, insurance or any similar arrangement) as such Debt becomes absolute and matures and (c) each of the Borrower and its Restricted Subsidiaries will not have (and will have no reason to believe that it will have thereafter) unreasonably small capital for the conduct of its business.

 

5.18 Taxpayer Identification Number.  The Borrower’s true and correct U.S. taxpayer identification number is set forth on Schedule 10.02.

 

                           ARTICLE VI.                                

 

AFFIRMATIVE COVENANTS

 

So long as any Lender shall have any Commitment hereunder, any Loan or other Obligation hereunder shall remain unpaid or unsatisfied, or any Letter of Credit shall remain outstanding, the Borrower covenants and agrees with the Lenders that:

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6.01 Financial Statements.  The Borrower will deliver to the Administrative Agent and each Lender:

 

(a) within 90 days after the end of each fiscal year of the Borrower, its audited Consolidated balance sheet and related statements of operations, unitholders’ equity and cash flows as of the end of and for such year, setting forth in each case in comparative form the figures for the previous fiscal year, all reported on by independent public accountants of recognized national standing (without a “going concern” or like qualification or exception) to the effect that such Consolidated financial statements present fairly in all material respects the financial condition and results of operations of the Borrower and its Consolidated Subsidiaries on a consolidated basis in accordance with GAAP consistently applied;

 

(b) within 45 days after the end of each of the first three fiscal quarters of each fiscal year of the Borrower, its Consolidated balance sheet and related statements of operations, unitholders’ equity and cash flows as of the end of and for such fiscal quarter and the then elapsed portion of the fiscal year, setting forth in each case in comparative form the figures for the corresponding period or periods of (or, in the case of the balance sheet, as of the end of) the previous fiscal year prepared on a basis consistent with that used on Form 10-Q as required by the SEC, all certified by one of its Responsible Officers as presenting fairly in all material respects the financial condition and results of operations of the Borrower and its Consolidated Subsidiaries on a consolidated basis in accordance with GAAP consistently applied, subject to normal year-end audit adjustments and the absence of footnotes;

 

As to any information contained in materials furnished pursuant to Section 6.02(c), the Borrower shall not be separately required to furnish such information under clause (a) or (b) above, but the foregoing shall not be in derogation of the obligation of the Borrower to furnish the information and materials described in clauses (a) and (b) above at the times specified therein.

 

6.02 Certificates; Other Information.  The Borrower will deliver to the Administrative Agent and each Lender, in form and detail reasonably satisfactory to the Administrative Agent and the Required Lenders:

 

(a) simultaneously with the delivery of the financial statements referred to in subsections (a) or (b) of Section 6.01, a copy of the certification signed by the principal executive officer and the principal financial officer of the General Partner (each, a “Certifying Officer”) as required by Rule 13A-14 under the Securities Exchange Act of 1934 and a copy of the internal controls disclosure statement by such Certifying Officers as required by Rule 13A-15 under the Securities Exchange Act of 1934 and Final Rules Release No. 33-8238 of the SEC, each as included in the Borrower’s Annual Report on Form 10-K or Quarterly Report on Form 10-Q, for the applicable fiscal period;

 

(b) concurrently with any delivery of financial statements under subsections (a) or (b) of Section 6.01, a Compliance Certificate of a Responsible Officer of the General Partner (i) certifying as to whether a Default has occurred and, if a Default has occurred, specifying the details thereof and any action taken or proposed to be taken with respect thereto, and (ii) setting forth reasonably detailed calculations demonstrating compliance with Sections 7.04(a), (b) and (c) as of the end of such fiscal quarter;

 

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(c) promptly after the same become publicly available, copies of all periodic and other reports, proxy statements and other materials filed by, or required to be filed by, the Borrower or any Subsidiary with the SEC, or any Governmental Authority succeeding to any or all of the functions of the SEC, or with any national securities exchange, or distributed by the Borrower to its unitholders generally, as the case may be;

 

(d) by April 30 of each year, the Borrower shall furnish to the Administrative Agent and to each Lender a Reserve Report and, if any Midstream Assets shall have been acquired by the Borrower or any of its Restricted Subsidiaries, a Midstream Assets Report, which such reports shall be dated as of the immediately preceding December 31 and shall set forth (i) in the case of the Reserve Report, the Proved Reserves attributable to all or substantially all of the Oil and Gas Properties then owned by the Borrower and its Restricted Subsidiaries and (ii) in the case of the Midstream Assets Report, those items as contemplated in the definition of “Midstream Assets Report” for all of the Midstream Assets then owned by the Borrower and its Restricted Subsidiaries, and in each case, the PV attributable thereto;

 

(e) promptly following any request therefor, such other information regarding the operations, business affairs and financial condition of the Borrower or any Subsidiary, or compliance with the terms of the Loan Documents, as the Administrative Agent or any Lender may reasonably request;

 

(f) concurrently with any delivery of financial statements under subsections (a) or (b) of Section 6.01, written notice of any changes in the Borrower’s hedging arrangements since the date of the last such notice; and

 

(g) concurrently with (i) any notice of designation of an Unrestricted Subsidiary or Restricted Subsidiary delivered under Section 6.12 and (ii) the consummation by the Borrower or any Restricted Subsidiary of any Acquisition or series of related Acquisitions or any Disposition or series of related Dispositions, in each case involving assets with a fair market value in excess of the Threshold Amount, a PV to Consolidated Indebtedness Compliance Certificate setting forth reasonably detailed calculations demonstrating compliance with Section 7.04(b) on such date after taking into effect such designation, Acquisition or Disposition.

 

Documents required to be delivered pursuant to Section 6.01(a) or (b) or Section 6.02(c) (to the extent any such documents are included in materials otherwise filed with the SEC) may be delivered electronically and if so delivered, shall be deemed to have been delivered on the date (i) on which the Borrower posts such documents, or provides a link thereto on the Borrower’s website on the Internet at the website address listed on Schedule 10.02; or (ii) on which such documents are posted on the Borrower’s behalf on an Internet or intranet website, if any, to which each Lender and the Administrative Agent have access (whether a commercial, third-party website or whether sponsored by the Administrative Agent); provided that:  (i) the Borrower shall deliver paper copies of such documents to the Administrative Agent or any Lender that requests the Borrower to deliver such paper copies until a written request to cease delivering paper copies is given by the Administrative Agent or such Lender and (ii) the 

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Borrower shall notify the Administrative Agent and each Lender (by telecopier or electronic mail) of the posting of any such documents and provide to the Administrative Agent by electronic mail electronic versions (i.e., soft copies) of such documents.  Notwithstanding anything contained herein, in every instance the Borrower shall be required to provide paper copies of the Compliance Certificates required by clauses (b) and (g) of Section 6.02 to the Administrative Agent.  Except for such Compliance Certificates, the Administrative Agent shall have no obligation to request the delivery or to maintain copies of the documents referred to above, and in any event shall have no responsibility to monitor compliance by the Borrower with any such request for delivery, and each Lender shall be solely responsible for requesting delivery to it or maintaining its copies of such documents.

 

The Borrower hereby acknowledges that (a) the Administrative Agent and/or the Co-Arrangers will make available to the Lenders and the L/C Issuer materials and/or information provided by or on behalf of the Borrower hereunder (collectively, “Borrower Materials”) by posting the Borrower Materials on IntraLinks or another similar electronic system (the “Platform”) and (b) certain of the Lenders (each, a “Public Lender”) may have personnel who do not wish to receive material non-public information with respect to the Borrower or its Affiliates, or the respective securities of any of the foregoing, and who may be engaged in investment and other market-related activities with respect to such Persons’ securities.  The Borrower hereby agrees that (w) all Borrower Materials that are to be made available to Public Lenders shall be clearly and conspicuously marked “PUBLIC” which, at a minimum, shall mean that the word “PUBLIC” shall appear prominently on the first page thereof; (x) by marking Borrower Materials “PUBLIC,” the Borrower shall be deemed to have authorized the Administrative Agent, the Co-Arrangers, the L/C Issuer and the Lenders to treat such Borrower Materials as not containing any material non-public information with respect to the Borrower or its securities for purposes of United States Federal and state securities laws (provided, however, that to the extent such Borrower Materials constitute Information, they shall be treated as set forth in Section 10.07); (y) all Borrower Materials marked “PUBLIC” are permitted to be made available through a portion of the Platform designated “Public Investor;” and (z) the Administrative Agent and the Co-Arranger shall be entitled to treat any Borrower Materials that are not marked “PUBLIC” as being suitable only for posting on a portion of the Platform not designated “Public Investor.”

 

6.03 Notices of Material Events.  The Borrower will furnish to the Administrative Agent and each Lender prompt written notice of the following:

 

(a) the occurrence of any Default;

 

(b) (i) the filing or commencement of any action, suit or proceeding by or before any arbitrator or Governmental Authority against or affecting the Borrower or any Affiliate thereof or (ii) the commencement of any litigation or proceeding affecting the Borrower or any Subsidiary, including pursuant to any applicable Environmental Laws; in each case, that could reasonably be expected to result in a Material Adverse Effect if adversely determined;

 

(c) the occurrence of any ERISA Event that, alone or together with any other ERISA Events that have occurred, could reasonably be expected to result in liability of the Borrower and its Subsidiaries in an aggregate amount exceeding the Threshold Amount;

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(d) any material change in accounting policies or financial reporting practices by the Borrower or any Subsidiary, including without limitation, any determination by the Borrower referred to in Section 2.10(b); and

 

(e) any other development that results in, or could reasonably be expected to result in, a Material Adverse Effect.

 

Each notice pursuant to this Section 6.03 shall be accompanied by a statement of a Responsible Officer of the Borrower setting forth details of the occurrence referred to therein and stating what action the Borrower or such Subsidiary, as applicable, has taken and proposes to take with respect thereto.  Each notice pursuant to Section 6.03(a) shall describe with particularity any and all provisions of this Agreement and any other Loan Document that have been breached.

 

6.04 Existence; Conduct of Business.  The Borrower will, and will cause each of its Restricted Subsidiaries to, do or cause to be done all things necessary to preserve, renew and keep in full force and effect its legal existence and the rights, licenses, permits, privileges and franchises material to the conduct of its business except for any failure to maintain, preserve or qualify that could not reasonably be expected to have a Material Adverse Effect; provided that the foregoing shall not prohibit (i) any merger, consolidation, liquidation or dissolution permitted under Section 7.03 or (ii) a termination of such existence, good standing, rights licenses, permits, privileges and franchises of any Restricted Subsidiary if Borrower determines in good faith that such termination is in the best interest of Borrower and could not reasonably be expected to have a Material Adverse Effect.

 

6.05 Payment of Obligations.  The Borrower will, and will cause each of its Subsidiaries to pay its obligations, including Tax liabilities, that, if not paid, could reasonably be expected to result in a Material Adverse Effect before the same shall become delinquent or in default, except where (a) the validity or amount thereof is being contested in good faith by appropriate proceedings, and (b) the Borrower or such Subsidiary has set aside on its books adequate reserves with respect thereto in accordance with GAAP.

 

6.06 Maintenance of Properties; Insurance.  The Borrower will, and will cause each of its Restricted Subsidiaries to (a) keep and maintain all property, material to the conduct of its business, in good working order and condition, ordinary wear and tear excepted, except for any failure that could not reasonably be expected to result in a Material Adverse Effect, (b) to operate, develop and maintain its Oil and Gas Properties and facilities in accordance with prudent industry standards and in conformity with all applicable Laws, except for any failure that could not reasonably be expected to result in a Material Adverse Effect, and (c) maintain, with financially sound and reputable insurance companies who are not Affiliates of the Borrower, insurance in such amounts, with such deductibles and covering such risks as are customarily carried by companies engaged in similar businesses and owning similar properties in localities where the Borrower or the applicable Subsidiary operates.

 

6.07 Books and Records; Inspection Rights.  The Borrower will, and will cause each of its Subsidiaries to, keep proper books of record and account in which full, true and correct entries are made of all dealings and transactions in relation to its business and activities, as and to 

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the extent required in accordance with GAAP.  The Borrower will, and will cause each of its Restricted Subsidiaries to, permit any representatives designated by the Administrative Agent or any Lender, upon reasonable prior notice, to visit and inspect its properties, to examine and make extracts from its books and records, and to discuss its affairs, finances and condition with its officers and independent accountants, all at such reasonable times and as often as reasonably requested; provided, however, that when an Event of Default exists the Administrative Agent or any Lender (or any of their respective representatives or independent contractors) may do any of the foregoing at the expense of the Borrower at any time during normal business hours and without advance notice.

 

6.08 Compliance with Laws.  The Borrower will, and will cause each of its Subsidiaries to, comply with all Laws, rules, regulations and orders of any Governmental Authority applicable to it or its property, except where the failure to do so, individually or in the aggregate, could not reasonably be expected to result in a Material Adverse Effect.

 

6.09 Use of Proceeds.  The proceeds of the Credit Extensions will be used for general corporate purposes not in contravention of any Law or of any Loan Document.  No part of the proceeds of any Loan will be used, whether directly or indirectly, for any purpose that entails a violation of any of the regulations issued by the FRB, including Regulations T, U and X.

 

6.10 Operations.  The Borrower will cause the primary business of the Borrower and its Restricted Subsidiaries, taken as a whole, to be the exploration, production, development and operation of oil, natural gas and other liquid and gaseous Hydrocarbons and the gathering, processing, transmission and marketing of Hydrocarbons and activities related or ancillary thereto, including the Acquisition and operation of any Midstream Assets.

 

6.11 Minimum Hedging.  The Borrower and its Restricted Subsidiaries shall at all times maintain, Swap Contracts with Qualified Counterparties with respect to not less than 50% of forecasted production (on an aggregate barrel of oil equivalent basis) attributable to Oil and Gas Properties constituting PDP reserves described in the most recent Reserve Report for all periods through December 31, 2014 and thereafter on a rolling basis of not less than two years or to the Maturity Date.

 

6.12 Additional Guarantors; Designation of Unrestricted Subsidiaries.  (a)  Unless designated as an Unrestricted Subsidiary in writing to the Administrative Agent within 15 days after a Person becomes a Subsidiary of the Borrower or any of its Restricted Subsidiaries, such Subsidiary shall be classified as a Restricted Subsidiary.  The Borrower will notify the Administrative Agent at the time that any Person becomes a Restricted Subsidiary (including a newly formed or newly acquired Domestic Subsidiary not otherwise designated as an Unrestricted Subsidiary), and promptly thereafter (and in any event within 45 days), cause such Person to (i) become a Guarantor by executing and delivering to the Administrative Agent a counterpart of the Guaranty or such other document as the Administrative Agent shall reasonably deem appropriate for such purpose and (ii) deliver to the Administrative Agent documents of the types referred to in clauses (iii) and (iv) of Section 4.01(a) and, if reasonably requested by the Administrative Agent, favorable opinions of counsel to such Person (which shall cover, among other things, the legality, validity, binding effect and enforceability of the documentation referred to in sub-clause (i)), all in form, content and scope reasonably satisfactory to the Administrative Agent.

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(b) A Responsible Officer may designate any Subsidiary of the Borrower (including any newly acquired or newly formed Subsidiary of the Borrower and a Restricted Subsidiary but excluding any Guarantor) other than Operating Company to be an Unrestricted Subsidiary unless such Subsidiary or any of its Subsidiaries (i) owns any Equity Interests or Indebtedness of, or holds any Lien, other than Permitted Encumbrances, on any property of, the Borrower or any Restricted Subsidiary of the Borrower, (ii) owns any Proved Reserves whose value was included in the calculation of PV set forth in the Compliance Certificate or PV to Consolidated Indebtedness Compliance Certificate, as applicable, most recently delivered to the Administrative Agent in accordance with clauses (b) or (g) of Section 6.02, or (iii) has any Indebtedness other than Non-Recourse Debt.  A Responsible Officer may designate any Unrestricted Subsidiary to be a Restricted Subsidiary; provided, however, that (iv) giving effect to such designation shall not result in the occurrence and continuance of a Default and (v) any Indebtedness of such Subsidiary shall not be secured by Liens at the time of such designation except for Liens permitted by Section 7.02.  Any such designation by a Responsible Officer shall be evidenced to the Administrative Agent by promptly filing with the Administrative Agent a copy of the resolution of a Responsible Officer giving effect to such designation and an officers’ certificate in form reasonably satisfactory to the Administrative Agent to the effect that such designation complied with the foregoing provisions.

 

                        ARTICLE VII.                                

 

NEGATIVE COVENANTS

 

So long as any Lender shall have any Commitment hereunder, any Loan or other Obligation hereunder shall remain unpaid or unsatisfied, or any Letter of Credit shall remain outstanding, the Borrower covenants and agrees with the Lenders that on and after the Closing Date:

 

7.01 Indebtedness.  The Borrower will not, and will not permit any Restricted Subsidiary to, incur Indebtedness except for:

 

(a) Indebtedness of Borrower and/or a Restricted Subsidiary in respect of letters of credit that does not secure Indebtedness or obligations of an Unrestricted Subsidiary;

 

(b) Indebtedness owed by the Borrower to a Restricted Subsidiary or by a Restricted Subsidiary to the Borrower or to another Restricted Subsidiary;

 

(c) Indebtedness of a Person that becomes, by acquisition or merger, a Restricted Subsidiary which Indebtedness existed prior to the time of such acquisition or merger and was not incurred or created in contemplation of such acquisition or merger;

 

(d) Indebtedness under the Loan Documents;

 

(e) Indebtedness secured by Liens permitted pursuant to Section 7.02, but only to the extent of Indebtedness so permitted; and

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(f) other unsecured Indebtedness outstanding at such time for Borrower and all Restricted Subsidiaries (but without duplication) in an aggregate amount not exceeding twenty percent (20%) of the Aggregate Commitments at such time.

 

7.02 Liens.  The Borrower will not, and will not permit any Restricted Subsidiary to, create, incur, assume or permit to exist any Lien on any property or asset now owned or hereafter acquired by it, or assign or sell any income or revenues (including accounts receivable) or rights in respect of any thereof, except:

 

(a) Permitted Encumbrances;

 

(b) any Lien on any property or asset of the Borrower or any Restricted Subsidiary existing on the Closing Date and set forth in Schedule 7.02; provided that (i) such Lien shall not apply to any other property or asset of the Borrower or any Restricted Subsidiary and (ii) such Lien shall secure only the Indebtedness and other obligations which it secures on the Closing Date and extensions, renewals and replacements thereof that do not increase the outstanding principal amount thereof;

 

(c) any Lien on any property or asset existing prior to the acquisition thereof by the Borrower or any Subsidiary or on any property or asset of any Person that becomes a Subsidiary after the Closing Date existing prior to the time such Person becomes a Restricted Subsidiary; provided that (i) such Lien is not created in contemplation of or in connection with such acquisition or such Person becoming a Subsidiary, as the case may be, (ii) such Lien shall not apply to any other property or assets of the Borrower or any Restricted Subsidiary, and (iv) such Lien shall secure only the Indebtedness and other obligations which it secures on the date of such acquisition or the date such Person becomes a Subsidiary, as the case may be and extensions, renewals and replacements thereof that do not increase the outstanding principal amount thereof;

 

(d) Liens created in connection with the acquisition, development, construction or improvement by the Borrower or any Restricted Subsidiary of fixed or capital assets; provided that (i) all Indebtedness secured by Liens permitted by this clause does not exceed $25,000,000 in the aggregate outstanding at any time, (ii) such Liens and the Indebtedness secured thereby are incurred prior to or within 180 days after such acquisition or the completion of such development, construction or improvement, (iii) the Indebtedness secured thereby does not exceed 100% of the cost of acquiring, developing, constructing or improving such fixed or capital assets and (iv) such Liens shall not apply to any property or assets of the Borrower or any Restricted Subsidiary other than such fixed or capital assets so acquired, developed, constructed or improved and other fixed or capital assets that are developed or improved thereby or otherwise reasonably related thereto (in the good faith determination of the Borrower) and working capital assets related thereto (including but not limited to revenue from, and insurance, condemnation, sale and other proceeds of, any such fixed or capital assets); and extensions, renewals and replacements thereof that do not increase the outstanding principal amount thereof;

 

(e) Liens securing obligations owing under this Agreement; and

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(f) Liens on deposits pursuant to any Swap Contract entered into by the Borrower or any Restricted Subsidiary in the ordinary course of its business, not to exceed $10,000,000 in the aggregate amount outstanding at any time.

 

7.03 Fundamental Changes.  (a)  The Borrower will not, and will not permit any Restricted Subsidiary to, merge into or consolidate with any other Person, or permit any other Person to merge into or consolidate with it or liquidate or dissolve, except that, if at the time thereof and immediately after giving effect thereto no Default shall have occurred and be continuing, including, for the avoidance of doubt, a Default arising from the Borrower’s failure to be in compliance with Section 7.04(b), (i) any Person may merge into the Borrower in a transaction in which the surviving entity is the Borrower or (ii) any Subsidiary may merge with any one or more other Subsidiaries or (iii) any Subsidiary of the Borrower may merge or consolidate in connection with the consummation of any Acquisition or Disposition that does not violate the other provisions of this Agreement or any other Loan Document.

 

(b) The Borrower will not sell, transfer, lease or otherwise Dispose of (in one transaction or in a series of transactions) all or substantially all of its assets, or all or substantially all of the equity interests of the Guarantors (in each case, whether now owned or hereafter acquired) other than to another Guarantor.  The Borrower will not permit any Restricted Subsidiary to sell, transfer, lease or otherwise Dispose of (in one transaction or in a series of transactions) all or substantially all of its assets, or all or substantially all of the equity interests of any Guarantor (in each case, whether now owned or hereafter acquired) if the Borrower would be in breach of any covenant set forth in Section 7.04 as a result of such Disposition.

 

7.04 Financial Covenants.  (a)  The Borrower will not permit, as of any Determination Date, the ratio of PV to Consolidated Indebtedness on such date to be less than 1.75 to 1.00.

 

(b) The Borrower shall not permit the Consolidated Leverage Ratio as of the last day of any fiscal quarter of the Borrower to be greater than 3.50 to 1.00; provided, that during an Acquisition Period, the maximum Consolidated Leverage Ratio shall automatically be increased to 4.00 to 1.00.  At the end of such Acquisition Period, the Consolidated Leverage Ratio will automatically revert to 3.50 to 1.00 without any further action required to be taken by the Administrative Agent, L/C Issuer, any Lender or Borrower.  Notwithstanding anything to the contrary contained herein, any failure by the Borrower to be in compliance with the requirements of this clause (b) of Section 7.04 shall not (and may not) be remedied by a change in the Consolidated Leverage Ratio upon election by the Borrower of an Acquisition Period.

 

7.05 Investments, Loans, Advances and Guarantees.  (a)  The Borrower will not, and will not permit any of its Restricted Subsidiaries to, make any loans or advances to, Guarantee any obligations of, or make any Investment or any other interest in, any Unrestricted Subsidiaries except that the Borrower or any Restricted Subsidiaries may make loans or advances to, or Investments or other interests in Unrestricted Subsidiaries in an aggregate principal amount not to exceed $40,000,000 at any one time outstanding.

 

(b) Except as permitted under Section 7.01(b)(iv), no Restricted Subsidiary shall Guarantee Indebtedness of the Borrower unless it shall have previously or concurrently therewith 

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Guaranteed the obligations under the Loan Documents on at least an equal and ratable basis with such Indebtedness of the Borrower, by execution and delivery of a Guaranty and other required documents in accordance with Section 6.12(a).

 

7.06 Swap Contracts.  The Borrower will not, and will not permit any of its Restricted Subsidiaries to, enter into any Swap Contract, except (a) Swap Contracts entered into to hedge or mitigate risks to which the Borrower or any Restricted Subsidiary has actual or projected exposure (other than those in respect of Equity Interests of the Borrower or any of its Subsidiaries) as long as on any date, the aggregate notional volume corresponding to all outstanding commodity forwards, swaps or collars or other similar hedging instruments from an economic and risk profile, but excluding volumes corresponding to puts, floors and other options that are purchased not in conjunction with any other Swap Contract, executed by the Borrower and its Restricted Subsidiaries does not exceed 90% of reasonably forecasted production (on an aggregate barrel of oil equivalent basis) attributable to Oil and Gas Properties and Midstream Assets of the Borrower and its Restricted Subsidiaries (inclusive of those Oil and Gas Properties and Midstream Assets to be acquired by the Borrower and its Restricted Subsidiaries pursuant to executed purchase agreements) constituting Proved Reserves, (b) Swap Contracts entered into in order to effectively cap, collar or exchange interest rates (from fixed to floating rates, from one floating rate to another floating rate or otherwise) with respect to any interest-bearing liability or Investment of the Borrower or any Restricted Subsidiary and (c) other Swap Contracts permitted under the risk management policies approved by the General Partner’s Board of Directors from time to time as long as such other Swap Contracts do not violate the limitations on Swap Contracts set forth in clauses (a) and (b) of this Section 7.06 and are entered into in the ordinary course of business for the purpose of directly mitigating risks associated with liabilities, commitments, Investments, assets, or property held or reasonably anticipated by the Borrower and its Subsidiaries, and not for purposes of speculation or taking a “market view.”

 

7.07 Transactions with Affiliates.  The Borrower will not, and will not permit any of its Restricted Subsidiaries to, sell, lease or otherwise transfer any property or assets to, or purchase, lease or otherwise acquire any property or assets from, or otherwise engage in any other transactions with, any of its Affiliates, except (a) the Material Contracts existing on the  Closing Date with any Affiliates and the transactions contemplated by those Material Contracts, (b) transactions in the ordinary course of business on customary terms, (c) any transaction (including an Acquisition or Disposition) that is, or by operation of the Partnership Agreement is deemed to be, fair and reasonable to the Borrower, (d) long-term incentive plans and similar compensatory plans for officers, directors and employees of the General Partner, Pioneer or Pioneer’s Subsidiaries and indemnification agreements and arrangements for the benefit of directors and officers of the General Partner, Pioneer or Pioneer’s Subsidiaries, in each case, as approved or adopted by the General Partner in compliance with the Partnership Agreement and (e) transactions between or among the Borrower and its wholly-owned Restricted Subsidiaries not involving any other Affiliate.

 

7.08 Restrictive Agreements.  The Borrower will not, and will not permit any of its Restricted Subsidiaries to, directly or indirectly, enter into, incur or permit to exist any Contractual Obligation (other than this Agreement or any other Loan Documents) that prohibits, restricts or imposes any condition upon the ability of any Restricted Subsidiary to pay dividends or other distributions with respect to any shares of its Equity Interests or to make or repay loans 

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or advances to the Borrower or any other Restricted Subsidiary or to Guarantee Indebtedness of the Borrower or any other Restricted Subsidiary; provided that (i) the foregoing shall not apply to restrictions and conditions imposed by law or by this Agreement, (ii) the foregoing shall not apply to restrictions and conditions existing on the Closing Date identified on Schedule 7.08 (but shall apply to any extension or renewal of, or any amendment or modification expanding the scope of, any such restriction or condition), (iii) the foregoing shall not apply to customary restrictions and conditions contained in agreements relating to the sale of a Subsidiary pending such sale, provided such restrictions and conditions apply only to the Subsidiary that is to be sold and such sale is permitted hereunder and (iv) the foregoing shall not apply to customary restrictions or conditions existing in any agreement relating to Indebtedness of a Person that becomes, by acquisition or merger, a Subsidiary of the Borrower or on acquired assets in effect at the time such Person becomes a Subsidiary of the Borrower or such assets are acquired, so long as such agreement was not entered into in contemplation of such Person becoming a Subsidiary of the Borrower and such restrictions or conditions will not materially impair the ability of the Borrower to pay its Indebtedness and other obligations hereunder.

 

7.09 Restricted Payments.  The Borrower will not, and will not permit any of its Restricted Subsidiaries to, declare or make, directly or indirectly, any Restricted Payment, or incur any obligation (contingent or otherwise) to do so, except that

 

(a) each Subsidiary may make Restricted Payments to the Borrower, the Guarantors and any other Person that owns an Equity Interest in such Subsidiary, ratably according to their respective holdings of the type of Equity Interest in respect of which such Restricted Payment is being made;

 

(b) the Borrower and each Subsidiary may declare and make dividend payments or other distributions payable solely in the common Equity Interests of such Person; and

 

(c) so long as (i) no Event of Default shall have occurred and be continuing at the time or would result therefrom, and (ii) the Borrower is in compliance with Section 7.04 prior to and after giving effect thereto, the Borrower may declare and make quarterly cash distributions to its partners in accordance with the Partnership Agreement of “Available Cash” as such term is defined in the Partnership Agreement.

 

7.10 Negative Pledge.  The Borrower will not, and will not permit any of its Restricted Subsidiaries to, directly or indirectly, enter into, incur or permit to exist any Contractual Obligation (other than this Agreement, any other Loan Document, Swap Contracts and agreements governing Indebtedness permitted under Section 7.01(f)) that requires the grant of a Lien to secure an obligation of such Person if a Lien is granted to secure another obligation of such Person or that limits the ability of the Borrower or any Restricted Subsidiary to create, incur, assume or suffer to exist Liens on property of such Person; provided, however, that this Section shall not prohibit any such Contractual Obligation incurred or provided in favor of any holder of any Lien permitted under Section 7.02 solely to the extent any such Contractual Obligation relates to the property encumbered by such Lien.

 

7.11 Tax Status as Partnership; Organizational and Material Contracts.  The Borrower shall not alter its status as a partnership for purposes of United States Federal income taxes.  The Borrower 

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shall not, and shall not permit any Restricted Subsidiary to, enter into or permit any amendment, modification, or waiver of any provision or material right or obligation of any Person under, or termination of (a) the Partnership Agreement or any other Organization Document other than as may be required to consummate any transaction or activity not prohibited by the terms of this Agreement and the other Loan Documents, including without limitation, the merger, consolidation, liquidation, or dissolution of a Subsidiary not prohibited by Section 7.03, or (b) any Material Contract, in each case, if such amendment, modification, waiver or termination could reasonably be expected to have a Material Adverse Effect.

 

                  ARTICLE VIII.                                

 

EVENTS OF DEFAULT AND REMEDIES

 

8.01 Events of Default.  Any of the following shall constitute an Event of Default:

 

(a) Non-Payment.  The Borrower or any other Loan Party shall fail to pay (i) any amount of principal of any Loan or any L/C Obligation when and as the same shall become due and payable, whether at due date thereof or at a date fixed for prepayment thereof or otherwise, or (ii) any interest on any Loan or any fee or any other amount (other than an amount referred to in sub-clause (i) of this clause (a)) payable under this Agreement, when and as the same shall become due and payable, and such failure shall continue unremedied for a period of five days; or

 

(b) Representations and Warranties.  Any representation or warranty made or deemed made by or on behalf of the Borrower or any other Loan Party in or in connection with this Agreement, any Guaranty or other Loan Document, or any amendment or modification hereof or waiver hereunder or thereunder, or in any report, certificate, financial statement or other document furnished pursuant to or in connection with this Agreement, any Guaranty or other Loan Document, or any amendment or modification hereof or thereof or any waiver hereof or thereof, shall prove to have been incorrect in any material respect when made or deemed made and either (1) a Responsible Officer of Borrower had actual knowledge that such representation or warranty was false or incorrect in a material respect when made or (2) if no Responsible Officer had such knowledge, such representation or warranty shall continue to be false or incorrect in any material respect thirty (30) Business Days after the earlier of a Responsible Officer of Borrower obtaining actual knowledge thereof or written notice thereof shall have been sent to Borrower by Administrative Agent or by any Lender; or

 

(c) Specific Covenants.  The Borrower shall fail to observe or perform any covenant, condition or agreement contained in Section 6.03, Section 6.04 (with respect to the Borrower’s or any Guarantor’s existence), or Section 6.09 or in Article VII; or

 

(d) Other Defaults.  The Borrower or any other Loan Party shall fail to observe or perform any covenant, condition or agreement contained in this Agreement or any Subsidiary Guaranty or any other Loan Document (other than those specified in clause (a) or (c) of this Section 8.01), and such failure shall continue unremedied for a period of thirty days after notice thereof from the Administrative Agent to the Borrower (which notice will be given at the request of any Lender); or

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(e) Cross-Default.  (i) The Borrower or any Restricted Subsidiary shall fail to make any payment of principal or interest in respect of any Material Indebtedness (other than in respect of any Swap Contract), when and as the same shall become due and payable and such failure continues beyond any applicable period of grace provided therefor or any event or condition occurs that results in any Material Indebtedness (including in respect of any Swap Contract) becoming due and payable prior to its scheduled maturity or that enables or permits the holder or holders of any Material Indebtedness (other than in respect of any Swap Contract) or any trustee or agent on its or their behalf to cause such Material Indebtedness to become due and payable, or to require the prepayment, repurchase, redemption or defeasance thereof, prior to its scheduled maturity, and such event or condition continues beyond any applicable period of grace provided therefor, provided that this clause (e) shall not apply to secured Indebtedness that becomes due and payable as a result of the voluntary sale or transfer of the property or assets securing such Indebtedness to the extent such Indebtedness is paid when due and payable; or (ii) any event or condition occurs of the type customarily included as an event of default under International Swap Dealers Association master agreements (with respect to which the Borrower or any Restricted Subsidiary is the defaulting party) that results in the holder or holders of any Material Indebtedness under a Swap Contract declaring an early termination date or such Material Indebtedness otherwise becoming due and payable prior to its scheduled maturity; or

 

(f) Insolvency Proceedings, Etc.  (i) An involuntary proceeding shall be commenced or an involuntary petition shall be filed seeking (A) liquidation, reorganization or other relief in respect of the Borrower or any Restricted Subsidiary or its debts, or of a substantial part of its assets, under any Debtor Relief Law now or hereafter in effect or (B) the appointment of a receiver, trustee, custodian, sequestrator, conservator or similar official for the Borrower or any Restricted Subsidiary or for a substantial part of its assets under any Debtor Relief Law relating to any such Person, and, in any such case, such appointment, proceeding or petition shall continue undischarged for 60 calendar days, or an order or decree approving or ordering any of the foregoing shall be entered; or (ii) the Borrower or any Restricted Subsidiary shall (i) voluntarily commence any proceeding or file any petition seeking liquidation, reorganization or other relief under any Debtor Relief Law now or hereafter in effect, (ii) consent to the institution of, or fail to contest in a timely and appropriate manner, any proceeding or petition described in sub-clause (i) of this clause (f), (iii) apply for or consent to the appointment of a receiver, trustee, custodian, sequestrator, conservator or similar official for the Borrower or any Restricted Subsidiary or for a substantial part of its assets, (iv) file an answer admitting the material allegations of a petition filed against it in any such proceeding, (v) make a general assignment for the benefit of creditors or (vi) take any action for the purpose of effecting any of the foregoing; or (ii) The Borrower or any Restricted Subsidiary institutes or consents to the institution of any proceeding under any Debtor Relief Law, or makes an assignment for the benefit of creditors; or applies for or consents to the appointment of any receiver, trustee, custodian, conservator, liquidator, rehabilitator or similar officer for it or for all or any material part of its property; or any receiver, trustee, custodian, conservator, liquidator, rehabilitator or similar officer is appointed without the application or consent of such Person and the appointment continues undischarged for 60 calendar days; or any proceeding under any Debtor Relief Law relating to any such Person or to all or any material part of its property is instituted without the consent of such Person and continues undismissed for 60 calendar days, or an order for relief is entered in any such proceeding; or

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(g) Inability to Pay Debts; Attachment.  (i) The Borrower or any Restricted Subsidiary becomes unable, or admits in writing its inability or fails generally to pay its debts as they become due, or (ii) any writ or warrant of attachment or execution or similar process is issued or levied against all or any material part of the property of any such Person and is not released, vacated or fully bonded within 30 days after its issue or levy; or

 

(h) Judgments.  One or more judgments for the payment of money in an aggregate amount in excess of the Threshold Amount shall be rendered against the Borrower, any Restricted Subsidiary or any combination thereof and the same shall remain undischarged for a period of 30 consecutive days during which execution shall not be effectively stayed, or any action shall be legally taken by a judgment creditor to attach or levy upon any material domestic assets of the Borrower or any Restricted Subsidiary to enforce any such judgment; or

 

(i) ERISA.  (i) An ERISA Event occurs with respect to a Pension Plan or Multiemployer Plan which, in the opinion of the Required Lenders, when taken together with all other ERISA Events that have occurred, has resulted or could reasonably be expected to result in a Material Adverse Effect, or (ii) the Borrower or any ERISA Affiliate fails to pay when due, after the expiration of any applicable grace period, any installment payment with respect to its withdrawal liability under Section 4201 of ERISA under a Multiemployer Plan in an aggregate amount in excess of the Threshold Amount; or

 

(j) Invalidity of Loan Documents.  Any Loan Document, at any time after its execution and delivery and for any reason other than as expressly permitted hereunder or thereunder or satisfaction in full of all the Obligations, ceases to be in full force and effect; or any Loan Party or any other Person contests in any manner the validity or enforceability of any Loan Document; or any Loan Party denies that it has any or further liability or obligation under any Loan Document, or purports to revoke, terminate or rescind any Loan Document; or

 

(k) Change of Control.  A Change of Control shall occur.

 

8.02 Remedies Upon Event of Default.  If any Event of Default occurs and is continuing, the Administrative Agent shall, at the request of, or may, with the consent of, the Required Lenders, take any or all of the following actions:

 

(a) declare the commitment of each Lender to make Loans and any obligation of the L/C Issuer to make L/C Credit Extensions to be terminated, whereupon such commitments and obligation shall be terminated;

 

(b) declare the unpaid principal amount of all outstanding Loans, all interest accrued and unpaid thereon, and all other amounts owing or payable hereunder or under any other Loan Document to be immediately due and payable, without presentment, demand, protest or other notice of any kind, all of which are hereby expressly waived by the Borrower;

 

(c) require that the Borrower Cash Collateralize the L/C Obligations (in an amount equal to the then Outstanding Amount thereof); and

 

(d) exercise on behalf of itself, the Lenders and the L/C Issuer all rights and remedies available to it, the Lenders and the L/C Issuer under the Loan Documents;

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provided, however, that upon the occurrence of an actual or deemed entry of an order for relief with respect to the Borrower under the Bankruptcy Code of the United States, the obligation of each Lender to make Loans and any obligation of the L/C Issuer to make L/C Credit Extensions shall automatically terminate, the unpaid principal amount of all outstanding Loans and all interest and other amounts as aforesaid shall automatically become due and payable, and the obligation of the Borrower to Cash Collateralize the L/C Obligations as aforesaid shall automatically become effective, in each case without further act of the Administrative Agent or any Lender.

 

                          ARTICLE IX.                                

 

ADMINISTRATIVE AGENT

 

9.01 Appointment and Authority.  Each of the Lenders and the L/C Issuer hereby irrevocably appoints Bank of America to act on its behalf as the Administrative Agent hereunder and under the other Loan Documents and authorizes the Administrative Agent to take such actions on its behalf and to exercise such powers as are delegated to the Administrative Agent by the terms hereof or thereof, together with such actions and powers as are reasonably incidental thereto.  The provisions of this Article are solely for the benefit of the Administrative Agent, the Lenders and the L/C Issuer, and the Borrower shall not have rights as a third party beneficiary of any of such provisions.

 

9.02 Rights as a Lender.  The Person serving as the Administrative Agent hereunder shall have the same rights and powers in its capacity as a Lender as any other Lender and may exercise the same as though it were not the Administrative Agent and the term “Lender” or “Lenders” shall, unless otherwise expressly indicated or unless the context otherwise requires, include the Person serving as the Administrative Agent hereunder in its individual capacity.  Such Person and its Affiliates may accept deposits from, lend money to, act as the financial advisor or in any other advisory capacity for and generally engage in any kind of business with the Borrower or any Subsidiary or other Affiliate thereof as if such Person were not the Administrative Agent hereunder and without any duty to account therefor to the Lenders.

 

9.03 Exculpatory Provisions.  The Administrative Agent shall not have any duties or obligations except those expressly set forth herein and in the other Loan Documents.  Without limiting the generality of the foregoing, the Administrative Agent:

 

(a) shall not be subject to any fiduciary or other implied duties, regardless of whether a Default has occurred and is continuing;

 

(b) shall not have any duty to take any discretionary action or exercise any discretionary powers, except discretionary rights and powers expressly contemplated hereby or by the other Loan Documents that the Administrative Agent is required to exercise as directed in writing by the Required Lenders (or such other number or percentage of the Lenders as shall be expressly provided for herein or in the other Loan Documents), provided that the Administrative Agent shall not be required to take any action that, in its opinion or the opinion of its counsel, may expose the Administrative Agent to liability or that is contrary to any Loan Document or applicable law; and

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(c) shall not, except as expressly set forth herein and in the other Loan Documents, have any duty to disclose, and shall not be liable for the failure to disclose, any information relating to the Borrower or any of its Affiliates that is communicated to or obtained by the Person serving as the Administrative Agent or any of its Affiliates in any capacity.

 

The Administrative Agent shall not be liable for any action taken or not taken by it (i) with the consent or at the request of the Required Lenders (or such other number or percentage of the Lenders as shall be necessary, or as the Administrative Agent shall believe in good faith shall be necessary, under the circumstances as provided in Sections 10.01 and 8.02) or (ii) in the absence of its own gross negligence or willful misconduct.  The Administrative Agent shall be deemed not to have knowledge of any Default unless and until notice describing such Default is given to the Administrative Agent by the Borrower, a Lender or the L/C Issuer.

 

The Administrative Agent shall not be responsible for or have any duty to ascertain or inquire into (i) any statement, warranty or representation made in or in connection with this Agreement or any other Loan Document, (ii) the contents of any certificate, report or other document delivered hereunder or thereunder or in connection herewith or therewith, (iii) the performance or observance of any of the covenants, agreements or other terms or conditions set forth herein or therein or the occurrence of any Default, (iv) the validity, enforceability, effectiveness or genuineness of this Agreement, any other Loan Document or any other agreement, instrument or document or (v) the satisfaction of any condition set forth in Article IV or elsewhere herein, other than to confirm receipt of items expressly required to be delivered to the Administrative Agent.

 

9.04 Reliance by Administrative Agent.  The Administrative Agent shall be entitled to rely upon, and shall not incur any liability for relying upon, any notice, request, certificate, consent, statement, instrument, document or other writing (including any electronic message, Internet or intranet website posting or other distribution) believed by it to be genuine and to have been signed, sent or otherwise authenticated by the proper Person.  The Administrative Agent also may rely upon any statement made to it orally or by telephone and believed by it to have been made by the proper Person, and shall not incur any liability for relying thereon.  In determining compliance with any condition hereunder to the making of a Loan, or the issuance of a Letter of Credit, that by its terms must be fulfilled to the satisfaction of a Lender or the L/C Issuer, the Administrative Agent may presume that such condition is satisfactory to such Lender or the L/C Issuer unless the Administrative Agent shall have received notice to the contrary from such Lender or the L/C Issuer prior to the making of such Loan or the issuance of such Letter of Credit.  The Administrative Agent may consult with legal counsel (who may be counsel for the Borrower), independent accountants and other experts selected by it, and shall not be liable for any action taken or not taken by it in accordance with the advice of any such counsel, accountants or experts.

 

9.05 Delegation of Duties.  The Administrative Agent may perform any and all of its duties and exercise its rights and powers hereunder or under any other Loan Document by or through any one or more sub-agents appointed by the Administrative Agent.  The Administrative Agent and any such sub-agent may perform any and all of its duties and exercise its rights and powers by or through their respective Related Parties.  The exculpatory provisions of this Article shall apply to any such sub-agent and to the Related Parties of the Administrative Agent 

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and any such sub-agent, and shall apply to their respective activities in connection with the syndication of the credit facilities provided for herein as well as activities as Administrative Agent.

 

9.06 Resignation of Administrative Agent.  The Administrative Agent may at any time give notice of its resignation to the Lenders, the L/C Issuer and the Borrower.  Upon receipt of any such notice of resignation, the Required Lenders shall have the right, in consultation with the Borrower, to appoint a successor, which shall be a bank with an office in the United States, or an Affiliate of any such bank with an office in the United States.  If no such successor shall have been so appointed by the Required Lenders and shall have accepted such appointment within 30 days after the retiring Administrative Agent gives notice of its resignation, then the retiring Administrative Agent may on behalf of the Lenders and the L/C Issuer, appoint a successor Administrative Agent meeting the qualifications set forth above; provided that if the Administrative Agent shall notify the Borrower and the Lenders that no qualifying Person has accepted such appointment, then such resignation shall nonetheless become effective in accordance with such notice and (1) the retiring Administrative Agent shall be discharged from its duties and obligations hereunder and under the other Loan Documents (except that in the case of any collateral security held by the Administrative Agent on behalf of the Lenders or the L/C Issuer under any of the Loan Documents, the retiring Administrative Agent shall continue to hold such collateral security until such time as a successor Administrative Agent is appointed) and (2) all payments, communications and determinations provided to be made by, to or through the Administrative Agent shall instead be made by or to each Lender and the L/C Issuer directly, until such time as the Required Lenders appoint a successor Administrative Agent as provided for above in this Section.  Upon the acceptance of a successor’s appointment as Administrative Agent hereunder, such successor shall succeed to and become vested with all of the rights, powers, privileges and duties of the retiring (or retired) Administrative Agent, and the retiring Administrative Agent shall be discharged from all of its duties and obligations hereunder or under the other Loan Documents (if not already discharged therefrom as provided above in this Section).  The fees payable by the Borrower to a successor Administrative Agent shall be the same as those payable to its predecessor unless otherwise agreed between the Borrower and such successor.  After the retiring Administrative Agent’s resignation hereunder and under the other Loan Documents, the provisions of this Article and Section 10.04 shall continue in effect for the benefit of such retiring Administrative Agent, its sub-agents and their respective Related Parties in respect of any actions taken or omitted to be taken by any of them while the retiring Administrative Agent was acting as Administrative Agent.

 

9.07 Non-Reliance on Administrative Agent and Other Lenders.  Each Lender and the L/C Issuer acknowledges that it has, independently and without reliance upon the Administrative Agent or any other Lender or any of their Related Parties and based on such documents and information as it has deemed appropriate, made its own credit analysis and decision to enter into this Agreement.  Each Lender and the L/C Issuer also acknowledges that it will, independently and without reliance upon the Administrative Agent or any other Lender or any of their Related Parties and based on such documents and information as it shall from time to time deem appropriate, continue to make its own decisions in taking or not taking action under or based upon this Agreement, any other Loan Document or any related agreement or any document furnished hereunder or thereunder.

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9.08 No Other Duties, Etc.  Anything herein to the contrary notwithstanding, none of the Joint Bookrunners, Co-Arrangers, Syndication Agent or Co-Documentation Agents listed on the cover page hereof shall have any powers, duties or responsibilities under this Agreement or any of the other Loan Documents, except in its capacity, as applicable, as the Administrative Agent, a Lender or the L/C Issuer hereunder.

 

9.09 Administrative Agent May File Proofs of Claim.  In case of the pendency of any proceeding under any Debtor Relief Law or any other judicial proceeding relative to any Loan Party, the Administrative Agent (irrespective of whether the principal of any Loan or L/C Obligation shall then be due and payable as herein expressed or by declaration or otherwise and irrespective of whether the Administrative Agent shall have made any demand on the Borrower) shall be entitled and empowered, by intervention in such proceeding or otherwise

 

(a) to file and prove a claim for the whole amount of the principal and interest owing and unpaid in respect of the Loans, L/C Obligations and all other Obligations that are owing and unpaid and to file such other documents as may be necessary or advisable in order to have the claims of the Lenders, the L/C Issuer and the Administrative Agent (including any claim for the reasonable compensation, expenses, disbursements and advances of the Lenders, the L/C Issuer and the Administrative Agent and their respective agents and counsel and all other amounts due the Lenders, the L/C Issuer and the Administrative Agent under Sections 2.03(i) and (j), 2.09 and 10.04) allowed in such judicial proceeding; and

 

(b) to collect and receive any monies or other property payable or deliverable on any such claims and to distribute the same;

 

and any custodian, receiver, assignee, trustee, liquidator, sequestrator or other similar official in any such judicial proceeding is hereby authorized by each Lender and the L/C Issuer to make such payments to the Administrative Agent and, in the event that the Administrative Agent shall consent to the making of such payments directly to the Lenders and the L/C Issuer, to pay to the Administrative Agent any amount due for the reasonable compensation, expenses, disbursements and advances of the Administrative Agent and its agents and counsel, and any other amounts due the Administrative Agent under Sections 2.09 and 10.04.

 

Nothing contained herein shall be deemed to authorize the Administrative Agent to authorize or consent to or accept or adopt on behalf of any Lender or the L/C Issuer any plan of reorganization, arrangement, adjustment or composition affecting the Obligations or the rights of any Lender or the L/C Issuer to authorize the Administrative Agent to vote in respect of the claim of any Lender or the L/C Issuer in any such proceeding.

 

9.10 Guaranty Matters.  The Lenders and the L/C Issuer irrevocably authorize the Administrative Agent, at its option and in its discretion, to release any Guarantor from its obligations under the Guaranty if such Person ceases to be a Restricted Subsidiary as a result of a transaction permitted hereunder.  Upon request by the Administrative Agent at any time, the Required Lenders will confirm in writing the Administrative Agent’s authority to release any Guarantor from its obligations under the Guaranty pursuant to this Section 9.10.

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                             ARTICLE X.                                

 

MISCELLANEOUS

 

10.01 Amendments, Etc.  No amendment or waiver of any provision of this Agreement or any other Loan Document, and no consent to any departure by the Borrower or any other Loan Party therefrom, shall be effective unless in writing signed by the Required Lenders and the Borrower or the applicable Loan Party, as the case may be, and acknowledged by the Administrative Agent, and each such waiver or consent shall be effective only in the specific instance and for the specific purpose for which given; provided, however, that no such amendment, waiver or consent shall:

 

(a) extend or increase the Commitment of any Lender (or reinstate any Commitment terminated pursuant to Section 8.02) without the written consent of such Lender;

 

(b) postpone any date fixed by this Agreement or any other Loan Document for any payment of principal, interest, fees or other amounts due to the Lenders (or any of them) hereunder or under any other Loan Document without the written consent of each Lender directly affected thereby;

 

(c) reduce the principal of, or the rate of interest specified herein on, any Loan or L/C Borrowing, or (subject to clause (iv) of the second proviso to this Section 10.01) any fees or other amounts payable hereunder or under any other Loan Document without the written consent of each Lender directly affected thereby; provided, however, that only the consent of the Required Lenders shall be necessary (i) to amend the definition of “Default Rate” or to waive any obligation of the Borrower to pay interest or Letter of Credit Fees at the Default Rate or (ii) to change the manner of computation of any financial ratio (including any change in any applicable defined term) used in determining the Applicable Rate even if the effect of such amendment would be to reduce the interest rate on any Loan or L/C Borrowing or to reduce any fee payable hereunder;

 

(d) change Section 2.13 in a manner that would alter the pro rata sharing of payments required thereby without the written consent of each Lender; or

 

(e) change any provision of this Section or the definition of “Required Lenders” or any other provision hereof specifying the number or percentage of Lenders required to amend, waive or otherwise modify any rights hereunder or make any determination or grant any consent hereunder without the written consent of each Lender; or

 

(f) release all or substantially all of the value of the Guaranty without the written consent of each Lender, except to the extent the release of any Guarantor is permitted pursuant to Section 9.10 (in which case such release may be made by the Administrative Agent acting alone);

 

and, provided further, that (i) no amendment, waiver or consent shall, unless in writing and signed by the L/C Issuer in addition to the Lenders required above, affect the rights or duties of the L/C Issuer under this Agreement or any Issuer Document relating to any Letter of Credit issued or to be issued by it; (ii) no amendment, waiver or consent shall, unless in writing and signed by the Swing Line Lender in addition to the Lenders required above, affect the rights or 

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duties of the Swing Line Lender under this Agreement; (iii) no amendment, waiver or consent shall, unless in writing and signed by the Administrative Agent in addition to the Lenders required above, affect the rights or duties of the Administrative Agent under this Agreement or any other Loan Document; and (iv) the Fee Letters may be amended, or rights or privileges thereunder waived, in a writing executed only by the parties thereto.  Notwithstanding anything to the contrary herein, no Defaulting Lender shall have any right to approve or disapprove any amendment, waiver or consent hereunder, except that the Commitment of such Lender may not be increased or extended without the consent of such Lender and any waiver, amendment, or modification requiring the consent off all Lenders or each affected Lender that by its terms affects any Defaulting Lender more adversely than other affected Lenders will require the consent of such Defaulting Lender.

 

10.02 Notices; Effectiveness; Electronic Communication.

 

(a) Notices Generally.  Except in the case of notices and other communications expressly permitted to be given by telephone (and except as provided in subsection (b) below), all notices and other communications provided for herein shall be in writing and shall be delivered by hand or overnight courier service, mailed by certified or registered mail or sent by telecopier as follows, and all notices and other communications expressly permitted hereunder to be given by telephone shall be made to the applicable telephone number, as follows:

 

(i) if to the Borrower, the Administrative Agent, the L/C Issuer or the Swing Line Lender, to the address, telecopier number, electronic mail address or telephone number specified for such Person on Schedule 10.02; and

 

(ii) if to any other Lender, to the address, telecopier number, electronic mail address or telephone number specified in its Administrative Questionnaire.

 

Notices sent by hand or overnight courier service, or mailed by certified or registered mail, shall be deemed to have been given when received; notices sent by telecopier shall be deemed to have been given when sent (except that, if not given during normal business hours for the recipient, shall be deemed to have been given at the opening of business on the next business day for the recipient).  Notices delivered through electronic communications to the extent provided in subsection (b) below, shall be effective as provided in such subsection (b).

 

(b) Electronic Communications.  Notices and other communications to the Lenders and the L/C Issuer hereunder may be delivered or furnished by electronic communication (including e-mail and Internet or intranet websites) pursuant to procedures approved by the Administrative Agent, provided that the foregoing shall not apply to notices to any Lender or the L/C Issuer pursuant to Article II if such Lender or the L/C Issuer, as applicable, has notified the Administrative Agent that it is incapable of receiving notices under such Article by electronic communication.  The Administrative Agent or the Borrower may, in its discretion, agree to accept notices and other communications to it hereunder by electronic communications pursuant to procedures approved by it, provided that approval of such procedures may be limited to particular notices or communications.

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Unless the Administrative Agent otherwise prescribes, (i) notices and other communications sent to an e-mail address shall be deemed received upon the sender’s receipt of an acknowledgement from the intended recipient (such as by the “return receipt requested” function, as available, return e-mail or other written acknowledgement), provided that if such notice or other communication is not sent during the normal business hours of the recipient, such notice or communication shall be deemed to have been sent at the opening of business on the next business day for the recipient, and (ii) notices or communications posted to an Internet or intranet website shall be deemed received upon the deemed receipt by the intended recipient at its e-mail address as described in the foregoing clause (i) of notification that such notice or communication is available and identifying the website address therefor.

 

(c) The Platform.  THE PLATFORM IS PROVIDED “AS IS” AND “AS AVAILABLE.”  THE AGENT PARTIES (AS DEFINED BELOW) DO NOT WARRANT THE ACCURACY OR COMPLETENESS OF THE BORROWER MATERIALS OR THE ADEQUACY OF THE PLATFORM, AND EXPRESSLY DISCLAIM LIABILITY FOR ERRORS IN OR OMISSIONS FROM THE BORROWER MATERIALS.  NO WARRANTY OF ANY KIND, EXPRESS, IMPLIED OR STATUTORY, INCLUDING ANY WARRANTY OF MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE, NON-INFRINGEMENT OF THIRD PARTY RIGHTS OR FREEDOM FROM VIRUSES OR OTHER CODE DEFECTS, IS MADE BY ANY AGENT PARTY IN CONNECTION WITH THE BORROWER MATERIALS OR THE PLATFORM.  In no event shall the Administrative Agent or any of its Related Parties (collectively, the “Agent Parties”) have any liability to the Borrower, any Lender, the L/C Issuer or any other Person for losses, claims, damages, liabilities or expenses of any kind (whether in tort, contract or otherwise) arising out of the Borrower’s or the Administrative Agent’s transmission of Borrower Materials through the Internet, except to the extent that such losses, claims, damages, liabilities or expenses are determined by a court of competent jurisdiction by a final and nonappealable judgment to have resulted from the gross negligence or willful misconduct of such Agent Party; provided, however, that in no event shall any Agent Party have any liability to the Borrower, any Lender, the L/C Issuer or any other Person for indirect, special, incidental, consequential or punitive damages (as opposed to direct or actual damages).

 

(d) Change of Address, Etc.  Each of the Borrower, the Administrative Agent, the L/C Issuer and the Swing Line Lender may change its address, telecopier or telephone number for notices and other communications hereunder by notice to the other parties hereto.  Each other Lender may change its address, telecopier or telephone number for notices and other communications hereunder by notice to the Borrower, the Administrative Agent, the L/C Issuer and the Swing Line Lender.  In addition, each Lender agrees to notify the Administrative Agent from time to time to ensure that the Administrative Agent has on record (i) an effective address, contact name, telephone number, telecopier number and electronic mail address to which notices and other communications may be sent and (ii) accurate wire instructions for such Lender.  Furthermore, each Public Lender agrees to cause at least one individual at or on behalf of such Public Lender to at all times have selected the “Private Side Information” or similar designation on the content declaration screen of the Platform in order to enable such Public Lender or its delegate, in accordance with such Public Lender’s compliance procedures and applicable Law, including United States Federal and state securities Laws, to make reference to Borrower Materials that are not made available through the “Public Side

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 Information” portion of the Platform and that may contain material non-public information with respect to the Borrower or its securities for purposes of United States Federal or state securities laws.

 

(e) Reliance by Administrative Agent, L/C Issuer and Lenders. The Administrative Agent, the L/C Issuer and the Lenders shall be entitled to rely and act upon any notices (including telephonic Committed Loan Notices and Swing Line Loan Notices) purportedly given by or on behalf of the Borrower even if (i) such notices were not made in a manner specified herein, were incomplete or were not preceded or followed by any other form of notice specified herein, or (ii) the terms thereof, as understood by the recipient, varied from any confirmation thereof.  The Borrower shall indemnify the Administrative Agent, the L/C Issuer, each Lender and the Related Parties of each of them from all losses, costs, expenses and liabilities resulting from the reliance by such Person on each notice purportedly given by or on behalf of the Borrower.  All telephonic notices to and other telephonic communications with the Administrative Agent may be recorded by the Administrative Agent, and each of the parties hereto hereby consents to such recording.

 

10.03 No Waiver; Cumulative Remedies.  No failure by any Lender, the L/C Issuer or the Administrative Agent to exercise, and no delay by any such Person in exercising, any right, remedy, power or privilege hereunder or under any other Loan Document shall operate as a waiver thereof; nor shall any single or partial exercise of any right, remedy, power or privilege hereunder preclude any other or further exercise thereof or the exercise of any other right, remedy, power or privilege.  The rights, remedies, powers and privileges herein provided, and provided under each other Loan Document, are cumulative and not exclusive of any rights, remedies, powers and privileges provided by law.

 

Notwithstanding anything to the contrary contained herein or in any other Loan Document, the authority to enforce rights and remedies hereunder and under the other Loan Documents1 against the Loan Parties or any of them shall be vested exclusively in, and all actions and proceedings at law in connection with such enforcement shall be instituted and maintained exclusively by, the Administrative Agent in accordance with Section 8.02 for the benefit of all the Lenders and the L/C Issuer; provided, however, that the foregoing shall not prohibit (a) the Administrative Agent from exercising on its own behalf the rights and remedies that inure to its benefit (solely in its capacity as Administrative Agent) hereunder and under the other Loan Documents, (b) the L/C Issuer or the Swing Line Lender from exercising the rights and remedies that inure to its benefit (solely in its capacity as L/C Issuer or Swing Line Lender, as the case may be) hereunder and under the other Loan Documents, (c) any Lender from exercising setoff rights in accordance with Section 10.08 (subject to the terms of Section 2.13), or (d) any Lender from filing proofs of claim or appearing and filing pleadings on its own behalf during the pendency of a proceeding relative to any Loan Party under any Debtor Relief Law; and provided, further, that if at any time there is no Person acting as Administrative Agent hereunder and under the other Loan Documents, then (i) the Required Lenders shall have the rights otherwise ascribed to the Administrative Agent pursuant to Section 8.02 and (ii) in

 

__________

1 If there are other agreements executed in connection with the Credit Agreement that are not included in the definition of "Loan Documents," be sure to include a reference to those agreements here.  Also, ensure that that no other Loan Document contains any provision that is inconsistent with this paragraph.

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addition to the matters set forth in clauses (b), (c) and (d) of the preceding proviso and subject to Section 2.13, any Lender may, with the consent of the Required Lenders, enforce any rights and remedies available to it and as authorized by the Required Lenders.2

 

10.04 Expenses; Indemnity; Damage Waiver.

 

(a) Costs and Expenses.  The Borrower shall pay (i) all reasonable documented out-of-pocket expenses incurred by the Administrative Agent, the Co-Arrangers and their Affiliates (including the reasonable documented fees, charges and disbursements of counsel for the Administrative Agent), in connection with the syndication of the credit facilities provided for herein, the preparation, negotiation, execution, delivery and administration of this Agreement and the other Loan Documents or any amendments, modifications or waivers of the provisions hereof or thereof (whether or not the transactions contemplated hereby or thereby shall be consummated), (ii) all reasonable documented out-of-pocket expenses incurred by the L/C Issuer in connection with the issuance, amendment, renewal or extension of any Letter of Credit or any demand for payment thereunder and (iii) all reasonable documented out-of-pocket expenses incurred by the Administrative Agent, any Lender or the L/C Issuer (including the fees, charges and disbursements of any counsel for the Administrative Agent, any Lender or the L/C Issuer), in connection with the enforcement or protection of its rights (A) in connection with this Agreement and the other Loan Documents, including its rights under this Section, or (B) in connection with the Loans made or Letters of Credit issued hereunder, including all such out-of-pocket expenses incurred during any workout, restructuring or negotiations in respect of such Loans or Letters of Credit.

 

(b) Indemnification by the Borrower.  The Borrower shall indemnify the Administrative Agent (and any sub-agent thereof), each Lender and the L/C Issuer, and each Related Party of any of the foregoing Persons (each such Person being called an “Indemnitee”) against, and hold each Indemnitee harmless from, any and all losses, claims, damages, liabilities and related expenses (including the reasonable fees, charges and disbursements of any counsel for any Indemnitee), incurred by any Indemnitee or asserted against any Indemnitee by any third party or by the Borrower or any other Loan Party arising out of, in connection with, or as a result of (i) the execution or delivery of this Agreement, any other Loan Document or any agreement or instrument contemplated hereby or thereby, the performance by the parties hereto of their respective obligations hereunder or thereunder, the consummation of the transactions contemplated hereby or thereby, or, in the case of the Administrative Agent (and any sub-agent thereof) and its Related Parties only, the administration of this Agreement and the other Loan Documents, (ii) any Loan or Letter of Credit or the use or proposed use of the proceeds therefrom (including any refusal by the L/C Issuer to honor a demand for payment under a Letter of Credit if the documents presented in connection with such demand do not strictly comply with the terms of such Letter of Credit), (iii) any actual or alleged presence or release of Hazardous Materials on or from any property owned or operated by the Borrower or any of its Subsidiaries, or any Environmental Liability related in any way to the Borrower or any of its Subsidiaries, or (iv) any actual or prospective claim, litigation, investigation or proceeding relating to any of the 

__________

2 BANK OF AMERICA PREFERENCE OR POLICY.  Do not make any material alteration to this paragraph without the approval of the Legal Department. 

 

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foregoing, whether based on contract, tort or any other theory, whether brought by a third party or by the Borrower or any other Loan Party, and regardless of whether any Indemnitee is a party thereto, IN ALL CASES, WHETHER OR NOT CAUSED BY OR ARISING, IN WHOLE OR IN PART, OUT OF THE COMPARATIVE, CONTRIBUTORY OR SOLE NEGLIGENCE OF THE INDEMNITEE; provided that such indemnity shall not, as to any Indemnitee, be available to the extent that such losses, claims, damages, liabilities or related expenses (x) are determined by a court of competent jurisdiction by final and nonappealable judgment to have resulted from the gross negligence or willful misconduct of such Indemnitee or (y) result from a claim brought by the Borrower or any other Loan Party against an Indemnitee for breach in bad faith of such Indemnitee’s obligations hereunder or under any other Loan Document, if the Borrower or such Loan Party has obtained a final and nonappealable judgment in its favor on such claim as determined by a court of competent jurisdiction.

 

(c) Reimbursement by Lenders.  To the extent that the Borrower for any reason fails to indefeasibly pay any amount required under subsection (a) or (b) of this Section to be paid by it to the Administrative Agent (or any sub-agent thereof), the L/C Issuer or any Related Party of any of the foregoing, each Lender severally agrees to pay to the Administrative Agent (or any such sub-agent), the L/C Issuer or such Related Party, as the case may be, such Lender’s Applicable Percentage (determined as of the time that the applicable unreimbursed expense or indemnity payment is sought) of such unpaid amount, provided that the unreimbursed expense or indemnified loss, claim, damage, liability or related expense, as the case may be, was incurred by or asserted against the Administrative Agent (or any such sub-agent) or the L/C Issuer in its capacity as such, or against any Related Party of any of the foregoing acting for the Administrative Agent (or any such sub-agent) or L/C Issuer in connection with such capacity.  The obligations of the Lenders under this subsection (c) are subject to the provisions of Section 2.12(d).

 

(d) Waiver of Consequential Damages, Etc.  To the fullest extent permitted by applicable law, the Borrower shall not assert, and hereby waives, any claim against any Indemnitee, on any theory of liability, for special, indirect, consequential or punitive damages (as opposed to direct or actual damages) arising out of, in connection with, or as a result of, this Agreement, any other Loan Document or any agreement or instrument contemplated hereby, the transactions contemplated hereby or thereby, any Loan or Letter of Credit or the use of the proceeds thereof.  No Indemnitee referred to in subsection (b) above shall be liable for any damages arising from the use by unintended recipients of any information or other materials distributed to such unintended recipients by such Indemnitee through telecommunications, electronic or other information transmission systems in connection with this Agreement or the other Loan Documents or the transactions contemplated hereby or thereby other than for direct or actual damages resulting from the gross negligence or willful misconduct of such Indemnitee as determined by a final and nonappealable judgment of a court of competent jurisdiction.

 

(e) Payments.  All amounts due under this Section shall be payable not later than ten Business Days after demand therefor.

 

(f) Survival.  The agreements in this Section shall survive the resignation of the Administrative Agent, the L/C Issuer and the Swing Line Lender, the replacement of any Lender, the termination of the Aggregate Commitments and the repayment, satisfaction or discharge of all the other Obligations.

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10.05 Payments Set Aside.  To the extent that any payment by or on behalf of the Borrower is made to the Administrative Agent, the L/C Issuer or any Lender, or the Administrative Agent, the L/C Issuer or any Lender exercises its right of setoff, and such payment or the proceeds of such setoff or any part thereof is subsequently invalidated, declared to be fraudulent or preferential, set aside or required (including pursuant to any settlement entered into by the Administrative Agent, the L/C Issuer or such Lender in its discretion) to be repaid to a trustee, receiver or any other party, in connection with any proceeding under any Debtor Relief Law or otherwise, then (a) to the extent of such recovery, the obligation or part thereof originally intended to be satisfied shall be revived and continued in full force and effect as if such payment had not been made or such setoff had not occurred, and (b) each Lender and the L/C Issuer severally agrees to pay to the Administrative Agent upon demand its applicable share (without duplication) of any amount so recovered from or repaid by the Administrative Agent, plus interest thereon from the date of such demand to the date such payment is made at a rate per annum equal to the Federal Funds Rate from time to time in effect.  The obligations of the Lenders and the L/C Issuer under clause (b) of the preceding sentence shall survive the payment in full of the Obligations and the termination of this Agreement.

 

10.06 Successors and Assigns.

 

(a) Successors and Assigns Generally.  The provisions of this Agreement shall be binding upon and inure to the benefit of the parties hereto and their respective successors and assigns permitted hereby, except that the Borrower may not assign or otherwise transfer any of its rights or obligations hereunder without the prior written consent of the Administrative Agent and each Lender and no Lender may assign or otherwise transfer any of its rights or obligations hereunder except (i) to an assignee in accordance with the provisions of subsection (b) of this Section, (ii) by way of participation in accordance with the provisions of subsection (d) of this Section, or (iii) by way of pledge or assignment of a security interest subject to the restrictions of subsection (f) of this Section (and any other attempted assignment or transfer by any party hereto shall be null and void).  Nothing in this Agreement, expressed or implied, shall be construed to confer upon any Person (other than the parties hereto, their respective successors and assigns permitted hereby, Participants to the extent provided in subsection (d) of this Section and, to the extent expressly contemplated hereby, the Related Parties of each of the Administrative Agent, the L/C Issuer and the Lenders) any legal or equitable right, remedy or claim under or by reason of this Agreement.

 

(b) Assignments by Lenders.  Any Lender may at any time assign to one or more assignees all or a portion of its rights and obligations under this Agreement (including all or a portion of its Commitment and the Loans (including for purposes of this subsection (b), participations in L/C Obligations and in Swing Line Loans) at the time owing to it); provided that any such assignment shall be subject to the following conditions:

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(i) Minimum Amounts.

 

(A) in the case of an assignment of the entire remaining amount of the assigning Lender’s Commitment and the Loans at the time owing to it or in the case of an assignment to a Lender, an Affiliate of a Lender or an Approved Fund, no minimum amount need be assigned; and

 

(B) in any case not described in subsection (b)(i)(A) of this Section, the aggregate amount of the Commitment (which for this purpose includes Loans outstanding thereunder) or, if the Commitment is not then in effect, the principal outstanding balance of the Loans of the assigning Lender subject to each such assignment, determined as of the date the Assignment and Assumption with respect to such assignment is delivered to the Administrative Agent or, if “Trade Date” is specified in the Assignment and Assumption, as of the Trade Date, shall not be less than $5,000,000 unless each of the Administrative Agent and, so long as no Event of Default has occurred and is continuing, the Borrower otherwise consents (each such consent not to be unreasonably withheld or delayed); provided, however, that concurrent assignments to members of an Assignee Group and concurrent assignments from members of an Assignee Group to a single Eligible Assignee (or to an Eligible Assignee and members of its Assignee Group) will be treated as a single assignment for purposes of determining whether such minimum amount has been met.

 

(ii) Proportionate Amounts.  Each partial assignment shall be made as an assignment of a proportionate part of all the assigning Lender’s rights and obligations under this Agreement with respect to the Loans or the Commitment assigned, except that this clause (ii) shall not apply to the Swing Line Lender’s rights and obligations in respect of Swing Line Loans;

 

(iii) Required Consents.  No consent shall be required for any assignment except to the extent required by subsection (b)(i)(B) of this Section and, in addition:

 

(A) the consent of the Borrower (such consent not to be unreasonably withheld or delayed) shall be required unless (1) an Event of Default has occurred and is continuing at the time of such assignment or (2) such assignment is to a Lender, an Affiliate of a Lender or an Approved Fund;

 

(B) the consent of the Administrative Agent (such consent not to be unreasonably withheld or delayed) shall be required if such assignment is to a Person that is not a Lender, an Affiliate of such Lender or an Approved Fund with respect to such Lender;

 

(C) the consent of the L/C Issuer (such consent not to be unreasonably withheld or delayed) shall be required for any assignment; and

 

(D) the consent of the Swing Line Lender (such consent not to be unreasonably withheld or delayed) shall be required for any assignment.

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(iv) Assignment and Assumption.  The parties to each assignment shall execute and deliver to the Administrative Agent an Assignment and Assumption, together with a processing and recordation fee in the amount of $3,500; provided, however, that the Administrative Agent may, in its sole discretion, elect to waive such processing and recordation fee in the case of any assignment.  The assignee, if it is not a Lender, shall deliver to the Administrative Agent an Administrative Questionnaire.

 

(v) No Assignment to Borrower.  No such assignment shall be made to the Borrower or any of the Borrower’s Affiliates or Subsidiaries.

 

(vi) No Assignment to Natural Persons.  No such assignment shall be made to a natural person.

 

Subject to acceptance and recording thereof by the Administrative Agent pursuant to subsection (c) of this Section, from and after the effective date specified in each Assignment and Assumption, the assignee thereunder shall be a party to this Agreement and, to the extent of the interest assigned by such Assignment and Assumption, have the rights and obligations of a Lender under this Agreement, and the assigning Lender thereunder shall, to the extent of the interest assigned by such Assignment and Assumption, be released from its obligations under this Agreement (and, in the case of an Assignment and Assumption covering all of the assigning Lender’s rights and obligations under this Agreement, such Lender shall cease to be a party hereto) but shall continue to be entitled to the benefits of Sections 3.01, 3.04, 3.05, and 10.04 with respect to facts and circumstances occurring prior to the effective date of such assignment.  Upon request, the Borrower (at its expense) shall execute and deliver a Note to the assignee Lender.  Any assignment or transfer by a Lender of rights or obligations under this Agreement that does not comply with this subsection shall be treated for purposes of this Agreement as a sale by such Lender of a participation in such rights and obligations in accordance with subsection (d) of this Section.

 

(c) Register.  The Administrative Agent, acting solely for this purpose as an agent of the Borrower, shall maintain at the Administrative Agent’s Office a copy of each Assignment and Assumption delivered to it and a register for the recordation of the names and addresses of the Lenders, and the Commitments of, and principal amounts of the Loans and L/C Obligations owing to, each Lender pursuant to the terms hereof from time to time (the “Register”).  The entries in the Register shall be conclusive, and the Borrower, the Administrative Agent and the Lenders may treat each Person whose name is recorded in the Register pursuant to the terms hereof as a Lender hereunder for all purposes of this Agreement, notwithstanding notice to the contrary.  In addition, the Administrative Agent shall maintain on the Register information regarding the designation, and revocation of designation, of any Lender as a Defaulting Lender.  The Register shall be available for inspection by the Borrower and any Lender, at any reasonable time and from time to time upon reasonable prior notice.

 

(d) Participations.  Any Lender may at any time, without the consent of, or notice to, the Borrower or the Administrative Agent, sell participations to any Person (other than a natural person, a Defaulting Lender, or the Borrower or any of the Borrower’s Affiliates or Subsidiaries) (each, a “Participant”) in all or a portion of such Lender’s rights and/or obligations under this Agreement (including all or a portion of its Commitment and/or the Loans (including such 

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Lender’s participations in L/C Obligations and/or Swing Line Loans) owing to it); provided that (i) such Lender’s obligations under this Agreement shall remain unchanged, (ii) such Lender shall remain solely responsible to the other parties hereto for the performance of such obligations and (iii) the Borrower, the Administrative Agent, the Lenders and the L/C Issuer shall continue to deal solely and directly with such Lender in connection with such Lender’s rights and obligations under this Agreement.

 

Any agreement or instrument pursuant to which a Lender sells such a participation shall provide that such Lender shall retain the sole right to enforce this Agreement and to approve any amendment, modification or waiver of any provision of this Agreement; provided that such agreement or instrument may provide that such Lender will not, without the consent of the Participant, agree to any amendment, waiver or other modification described in the first proviso to Section 10.01 that affects such Participant.  Subject to subsection (e) of this Section, the Borrower agrees that each Participant shall be entitled to the benefits of Sections 3.01, 3.04 and 3.05 to the same extent as if it were a Lender and had acquired its interest by assignment pursuant to subsection (b) of this Section.  To the extent permitted by law, each Participant also shall be entitled to the benefits of Section 10.08 as though it were a Lender, provided such Participant agrees to be subject to Section 2.13 as though it were a Lender.

 

(e) Limitations upon Participant Rights.  A Participant shall not be entitled to receive any greater payment under Section 3.01 or 3.04 than the applicable Lender would have been entitled to receive with respect to the participation sold to such Participant, unless the sale of the participation to such Participant is made with the Borrower’s prior written consent.  A Participant that would be a Foreign Lender if it were a Lender shall not be entitled to the benefits of Section 3.01 unless the Borrower is notified of the participation sold to such Participant and such Participant agrees, for the benefit of the Borrower, to comply with Section 3.01(e) as though it were a Lender.

 

(f) Certain Pledges.  Any Lender may at any time pledge or assign a security interest in all or any portion of its rights under this Agreement (including under its Note, if any) to secure obligations of such Lender, including any pledge or assignment to secure obligations to a Federal Reserve Bank; provided that no such pledge or assignment shall release such Lender from any of its obligations hereunder or substitute any such pledgee or assignee for such Lender as a party hereto.

 

(g) Electronic Execution of Assignments.  The words “execution,” “signed,” “signature,” and words of like import in any Assignment and Assumption shall be deemed to include electronic signatures or the keeping of records in electronic form, each of which shall be of the same legal effect, validity or enforceability as a manually executed signature or the use of a paper-based recordkeeping system, as the case may be, to the extent and as provided for in any applicable law, including the Federal Electronic Signatures in Global and National Commerce Act, the New York State Electronic Signatures and Records Act, or any other similar state laws based on the Uniform Electronic Transactions Act.

 

(h) Resignation as L/C Issuer or Swing Line Lender after Assignment.  Notwithstanding anything to the contrary contained herein, if at any time Bank of America assigns all of its Commitment and Loans pursuant to subsection (b) above, Bank of America 

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may, (i) upon 30 days’ notice to the Borrower and the Lenders, resign as L/C Issuer and/or (ii) upon 30 days’ notice to the Borrower, resign as Swing Line Lender.  In the event of any such resignation as L/C Issuer or Swing Line Lender, the Borrower shall be entitled to appoint from among the Lenders a successor L/C Issuer or Swing Line Lender hereunder; provided, however, that no failure by the Borrower to appoint any such successor shall affect the resignation of Bank of America as L/C Issuer or Swing Line Lender, as the case may be.  If Bank of America resigns as L/C Issuer, it shall retain all the rights, powers, privileges and duties of the L/C Issuer hereunder with respect to all Letters of Credit outstanding as of the effective date of its resignation as L/C Issuer and all L/C Obligations with respect thereto (including the right to require the Lenders to make Base Rate Committed Loans or fund risk participations in Unreimbursed Amounts pursuant to Section 2.03(c)).  If Bank of America resigns as Swing Line Lender, it shall retain all the rights of the Swing Line Lender provided for hereunder with respect to Swing Line Loans made by it and outstanding as of the effective date of such resignation, including the right to require the Lenders to make Base Rate Committed Loans or fund risk participations in outstanding Swing Line Loans pursuant to Section 2.04(c).  Upon the appointment of a successor L/C Issuer and/or Swing Line Lender, (a) such successor shall succeed to and become vested with all of the rights, powers, privileges and duties of the retiring L/C Issuer or Swing Line Lender, as the case may be, and (b) the successor L/C Issuer shall issue letters of credit in substitution for the Letters of Credit, if any, outstanding at the time of such succession or make other arrangements reasonably satisfactory to Bank of America to effectively assume the obligations of Bank of America with respect to such Letters of Credit.

 

10.07 Treatment of Certain Information; Confidentiality.  Each of the Administrative Agent, the Lenders and the L/C Issuer agrees to maintain the confidentiality of the Information (as defined below), except that Information may be disclosed (a) to its Affiliates and to its and its Affiliates’ respective partners, directors, officers, employees, agents, advisors and representatives (it being understood that the Persons to whom such disclosure is made will be informed of the confidential nature of such Information and instructed to keep such Information confidential), (b) to the extent requested by any regulatory authority purporting to have jurisdiction over it (including any self-regulatory authority, such as the National Association of Insurance Commissioners), (c) to the extent required by applicable laws or regulations or by any subpoena or similar legal process, (d) to any other party hereto, (e) in connection with the exercise of any remedies hereunder or under any other Loan Document or any action or proceeding relating to this Agreement or any other Loan Document or the enforcement of rights hereunder or thereunder, (f) subject to an agreement containing provisions substantially the same as those of this Section, to (i) any assignee of or Participant in, or any prospective assignee of or Participant in, any of its rights or obligations under this Agreement or any Eligible Assignee invited to be a Lender pursuant to Section 2.15(c), (ii) any actual or prospective counterparty (or its advisors) to any swap or derivative transaction relating to the Borrower and its obligations, (iii) to its advisors (other than its accountants and legal counsel), (iv) to an investor or prospective investor in an Approved Fund that also agrees that Information shall be used solely for the purpose of evaluating an investment in such Approved Fund, (v) to a trustee, collateral manager, servicer, backup servicer, noteholder or secured party in an Approved Fund in connection with the administration, servicing and reporting on the assets serving as collateral for an Approved Fund, or (vi) to a nationally recognized rating agency that requires access to information regarding the Borrower, the Loans and Loan Documents in connection with ratings issued with respect to an Approved Fund, (g) with the consent of the Borrower or 

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(h) to the extent such Information (x) becomes publicly available other than as a result of a breach of this Section or (y) becomes available to the Administrative Agent, any Lender, the L/C Issuer or any of their respective Affiliates on a nonconfidential basis from a source other than the Borrower.

 

For purposes of this Section, “Information” means all information received from the Borrower or any Subsidiary relating to the Borrower or any Subsidiary or any of their respective businesses, other than any such information that is available to the Administrative Agent, any Lender or the L/C Issuer on a nonconfidential basis prior to disclosure by the Borrower or any Subsidiary, provided that, in the case of information received from the Borrower or any Subsidiary after the date hereof, such information is clearly identified at the time of delivery as confidential.  Any Person required to maintain the confidentiality of Information as provided in this Section shall be considered to have complied with its obligation to do so if such Person has exercised the same degree of care to maintain the confidentiality of such Information as such Person would accord to its own confidential information.

 

Each of the Administrative Agent, the Lenders and the L/C Issuer acknowledges that (a) the Information may include material non-public information concerning the Borrower or a Subsidiary, as the case may be, (b) it has developed compliance procedures regarding the use of material non-public information and (c) it will handle such material non-public information in accordance with applicable Law, including United States Federal and state securities Laws.

 

10.08 Right of Setoff.  If an Event of Default shall have occurred and be continuing, each Lender, the L/C Issuer and each of their respective Affiliates is hereby authorized at any time and from time to time, to the fullest extent permitted by applicable law, to set off and apply any and all deposits (general or special, time or demand, provisional or final, in whatever currency) at any time held and other obligations (in whatever currency) at any time owing by such Lender, the L/C Issuer or any such Affiliate to or for the credit or the account of the Borrower against any and all of the obligations of the Borrower now or hereafter existing under this Agreement or any other Loan Document to such Lender or the L/C Issuer, irrespective of whether or not such Lender or the L/C Issuer shall have made any demand under this Agreement or any other Loan Document and although such obligations of the Borrower may be contingent or unmatured or are owed to a branch or office of such Lender or the L/C Issuer different from the branch or office holding such deposit or obligated on such indebtedness.  The rights of each Lender, the L/C Issuer and their respective Affiliates under this Section are in addition to other rights and remedies (including other rights of setoff) that such Lender, the L/C Issuer or their respective Affiliates may have.  Each Lender and the L/C Issuer agrees to notify the Borrower and the Administrative Agent promptly after any such setoff and application, provided that the failure to give such notice shall not affect the validity of such setoff and application. 

 

10.09 Interest Rate Limitation.  Notwithstanding anything to the contrary contained in any Loan Document, the interest paid or agreed to be paid under the Loan Documents shall not exceed the maximum rate of non-usurious interest permitted by applicable Law (the “Maximum Rate”).  If the Administrative Agent or any Lender shall receive interest in an amount that exceeds the Maximum Rate, the excess interest shall be applied to the principal of the Loans or, if it exceeds such unpaid principal, refunded to the Borrower.  In determining whether the interest contracted for, charged, or received by the Administrative Agent or a Lender exceeds the 

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Maximum Rate, such Person may, to the extent permitted by applicable Law, (a) characterize any payment that is not principal as an expense, fee, or premium rather than interest, (b) exclude voluntary prepayments and the effects thereof, and (c) amortize, prorate, allocate, and spread in equal or unequal parts the total amount of interest throughout the contemplated term of the Obligations hereunder.  To the extent that Chapter 303 of the Texas Finance Code is relevant for the purpose of determining the Maximum Rate applicable to a Lender, such Lender elects to determine the applicable rate ceiling under such Chapter by the weekly ceiling from time to time in effect.  Chapter 346 of the Texas Finance Code does not apply to the Borrower’s obligations hereunder.

 

10.10 Counterparts; Integration; Effectiveness.  This Agreement may be executed in counterparts (and by different parties hereto in different counterparts), each of which shall constitute an original, but all of which when taken together shall constitute a single contract.  This Agreement and the other Loan Documents constitute the entire contract among the parties relating to the subject matter hereof and supersede any and all previous agreements and understandings, oral or written, relating to the subject matter hereof.  Except as provided in Section 4.01, this Agreement shall become effective when it shall have been executed by the Administrative Agent and when the Administrative Agent shall have received counterparts hereof that, when taken together, bear the signatures of each of the other parties hereto.  Delivery of an executed counterpart of a signature page of this Agreement by telecopy or other electronic imaging means shall be effective as delivery of a manually executed counterpart of this Agreement.

 

10.11 Survival of Representations and Warranties.  All representations and warranties made hereunder and in any other Loan Document or other document delivered pursuant hereto or thereto or in connection herewith or therewith shall survive the execution and delivery hereof and thereof.  Such representations and warranties have been or will be relied upon by the Administrative Agent and each Lender, regardless of any investigation made by the Administrative Agent or any Lender or on their behalf and notwithstanding that the Administrative Agent or any Lender may have had notice or knowledge of any Default at the time of any Credit Extension, and shall continue in full force and effect as long as any Loan or any other Obligation hereunder shall remain unpaid or unsatisfied or any Letter of Credit shall remain outstanding.

 

10.12 Severability.  If any provision of this Agreement or the other Loan Documents is held to be illegal, invalid or unenforceable, (a) the legality, validity and enforceability of the remaining provisions of this Agreement and the other Loan Documents shall not be affected or impaired thereby and (b) the parties shall endeavor in good faith negotiations to replace the illegal, invalid or unenforceable provisions with valid provisions the economic effect of which comes as close as possible to that of the illegal, invalid or unenforceable provisions.  The invalidity of a provision in a particular jurisdiction shall not invalidate or render unenforceable such provision in any other jurisdiction.

 

10.13 Replacement of Lenders.  If any Lender requests compensation under Section 3.04, or if the Borrower is required to pay any additional amount to any Lender or any Governmental Authority for the account of any Lender pursuant to Section 3.01, if any Lender gives a notice pursuant to Section 3.02, if any Lender is a Defaulting Lender, if any Lender fails 

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to consent to a requested amendment, waiver, consent or modification as contemplated by Section 10.01 with respect to any Loan Document that requires the consent of each Lender, or each Lender affected thereby, and that has already been approved by the Required Lenders, or if any other circumstance exists hereunder that gives the Borrower the right to replace a Lender as a party hereto, then the Borrower may, at its sole expense and effort, upon notice to such Lender and the Administrative Agent, require such Lender to assign and delegate, without recourse (in accordance with and subject to the restrictions contained in, and consents required by, Section 10.06), all of its interests, rights and obligations under this Agreement and the related Loan Documents to an assignee that shall assume such obligations (which assignee may be another Lender, if a Lender accepts such assignment), provided that:

 

(a) the Borrower shall have paid to the Administrative Agent the assignment fee specified in Section 10.06(b);

 

(b) such Lender shall have received payment of an amount equal to the outstanding principal of its Loans and L/C Advances, accrued interest thereon, accrued fees and all other amounts payable to it hereunder and under the other Loan Documents (including any amounts under Section 3.05) from the assignee (to the extent of such outstanding principal and accrued interest and fees) or the Borrower (in the case of all other amounts);

 

(c) in the case of any such assignment resulting from a claim for compensation under Section 3.04 or payments required to be made pursuant to Section 3.01, such assignment will result in a reduction in such compensation or payments thereafter;

 

(d) in connection with any such replacement, if any such Defaulting Lender does not execute and deliver to the Administrative Agent a duly executed Assignment and Assumption reflecting such replacement within ten (10) Business Days of the date on which the assignee Lender executes and delivers such Assignment and Assumption to such Defaulting Lender, then such or Defaulting Lender, other than any Lender that qualifies as an Defaulting Lender solely as a result of such Lender, or the entity that Controls such Lender, becoming subject to a proceeding under any Debtor Relief Law, shall be deemed to have executed and delivered such Assignment and Assumption without any action on the part of the Defaulting Lender; and

 

(e) such assignment does not conflict with applicable Laws.

 

A Lender shall not be required to make any such assignment or delegation if, prior thereto, as a result of a waiver by such Lender or otherwise, the circumstances entitling the Borrower to require such assignment and delegation cease to apply.

 

10.14 Governing Law; Jurisdiction; Etc.

 

(a) GOVERNING LAW.  THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAW OF THE STATE OF TEXAS.

 

(b) SUBMISSION TO JURISDICTION.  THE BORROWER IRREVOCABLY AND UNCONDITIONALLY SUBMITS, FOR ITSELF AND ITS PROPERTY, TO THE NONEXCLUSIVE JURISDICTION OF THE COURTS OF THE STATE OF TEXAS AND OF THE UNITED STATES DISTRICT COURT OF THE SOUTHERN DISTRICT OF TEXAS, 

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AND ANY APPELLATE COURT FROM ANY THEREOF, IN ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT, OR FOR RECOGNITION OR ENFORCEMENT OF ANY JUDGMENT, AND EACH OF THE PARTIES HERETO IRREVOCABLY AND UNCONDITIONALLY AGREES THAT ALL CLAIMS IN RESPECT OF ANY SUCH ACTION OR PROCEEDING MAY BE HEARD AND DETERMINED IN SUCH TEXAS STATE COURT OR, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, IN SUCH FEDERAL COURT.  EACH OF THE PARTIES HERETO AGREES THAT A FINAL JUDGMENT IN ANY SUCH ACTION OR PROCEEDING SHALL BE CONCLUSIVE AND MAY BE ENFORCED IN OTHER JURISDICTIONS BY SUIT ON THE JUDGMENT OR IN ANY OTHER MANNER PROVIDED BY LAW.  NOTHING IN THIS AGREEMENT OR IN ANY OTHER LOAN DOCUMENT SHALL AFFECT ANY RIGHT THAT THE ADMINISTRATIVE AGENT, ANY LENDER OR THE L/C ISSUER MAY OTHERWISE HAVE TO BRING ANY ACTION OR PROCEEDING RELATING TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT AGAINST THE BORROWER OR ITS PROPERTIES IN THE COURTS OF ANY JURISDICTION.

 

(c) WAIVER OF VENUE.  THE BORROWER IRREVOCABLY AND UNCONDITIONALLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY OBJECTION THAT IT MAY NOW OR HEREAFTER HAVE TO THE LAYING OF VENUE OF ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT IN ANY COURT REFERRED TO IN PARAGRAPH (B) OF THIS SECTION.  EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, THE DEFENSE OF AN INCONVENIENT FORUM TO THE MAINTENANCE OF SUCH ACTION OR PROCEEDING IN ANY SUCH COURT.

 

(d) SERVICE OF PROCESS.  EACH PARTY HERETO IRREVOCABLY CONSENTS TO SERVICE OF PROCESS IN THE MANNER PROVIDED FOR NOTICES IN SECTION 10.02.  NOTHING IN THIS AGREEMENT WILL AFFECT THE RIGHT OF ANY PARTY HERETO TO SERVE PROCESS IN ANY OTHER MANNER PERMITTED BY APPLICABLE LAW.

 

10.15 Waiver of Jury Trial.  EACH PARTY HERETO HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY (WHETHER BASED ON CONTRACT, TORT OR ANY OTHER THEORY).  EACH PARTY HERETO (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PERSON HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PERSON WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND (B) ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION.

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10.16 No Advisory or Fiduciary Responsibility.  In connection with all aspects of each transaction contemplated hereby (including in connection with any amendment, waiver or other modification hereof or of any other Loan Document), the Borrower acknowledges and agrees, and acknowledges its Affiliates’ understanding, that: (i)(A) the arranging and other services regarding this Agreement provided by the Administrative Agent and the Co-Arrangers, are arm’s-length commercial transactions between the Borrower, each other Loan Party and their respective Affiliates, on the one hand, and the Administrative Agent and the Co-Arrangers, on the other hand, (B) each of the Borrower and the other Loan Parties has consulted its own legal, accounting, regulatory and tax advisors to the extent it has deemed appropriate, and (C) the Borrower and each other Loan Party is capable of evaluating, and understands and accepts, the terms, risks and conditions of the transactions contemplated hereby and by the other Loan Documents; (ii)(A) the Administrative Agent and the Co-Arrangers each is and has been acting solely as a principal and, except as expressly agreed in writing by the relevant parties, has not been, is not, and will not be acting as an advisor, agent or fiduciary for the Borrower, any other Loan Party or any of their respective Affiliates, or any other Person and (B) neither the Administrative Agent nor any of the Co-Arrangers has any obligation to the Borrower, any other Loan Party or any of their respective Affiliates with respect to the transactions contemplated hereby except those obligations expressly set forth herein and in the other Loan Documents; and (iii) the Administrative Agent and the Co-Arrangers and their respective Affiliates may be engaged in a broad range of transactions that involve interests that differ from those of the Borrower, the other Loan Parties and their respective Affiliates, and neither the Administrative Agent nor any of the Co-Arrangers has any obligation to disclose any of such interests to the Borrower, any other Loan Party or any of their respective Affiliates.  To the fullest extent permitted by law, the Borrower hereby waives and releases any claims that it may have against the Administrative Agent and the Co-Arrangers with respect to any breach or alleged breach of agency or fiduciary duty in connection with any aspect of any transaction contemplated hereby.

 

10.17 USA PATRIOT Act Notice.  Each Lender that is subject to the Act (as hereinafter defined) and the Administrative Agent (for itself and not on behalf of any Lender) hereby notifies the Borrower that pursuant to the requirements of the USA PATRIOT Act (Title III of Pub. L. 107-56 (signed into law October 26, 2001)) (the “Act”), it is required to obtain, verify and record information that identifies the Borrower, which information includes the name and address of the Borrower and other information that will allow such Lender or the Administrative Agent, as applicable, to identify the Borrower in accordance with the Act.

 

10.18 No Liability of General Partner.  The Administrative Agent and the Lenders agree for themselves and their respective successors and assigns, including any subsequent holder of any Note, that no claim against the Borrower or its Subsidiaries under this Agreement or under any other Loan Document shall be made against General Partner, and that no judgment, order or execution entered in any suit, action or proceeding, whether legal or equitable, on this Agreement or on any other Loan Document shall be obtained or enforced against General Partner or its assets for the purpose of obtaining satisfaction and payment of amounts owed under this Agreement or any other Loan Document.  Nothing in this Section 10.18, however, shall be construed so as to prevent the Administrative Agent, any Lender or any other holder of any Note from commencing any action, suit or proceeding with respect to, or causing legal papers to be served upon, General Partner for the purpose of (a) obtaining jurisdiction over the Borrower or its Subsidiaries or (b) obtaining judgment, order or execution against General Partner arising out 

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of any fraud or intentional misrepresentation by General Partner in connection with the Loan Documents or for the recovery of moneys received by General Partner in violation of this Agreement or any other Loan Document.

 

10.19 Swap Contracts and Guaranty.  The benefit of the Guaranty shall also extend to and be available to those Lenders or their Affiliates which are counterparties to any Swap Contract with the Borrower or any of its Restricted Subsidiaries on a pro rata basis in respect of any obligations of any Loan Party which arise under any such Swap Contract while such Person or its Affiliate is a Lender.  No Lender or any Affiliate of a Lender shall have any voting rights under any Loan Document as a result of the existence of obligations owed to it under any such Swap Contracts.

 

10.20 Amendment and Restatement.  This Agreement shall be deemed to restate and amend the Existing Credit Agreement in its entirety, and all of the terms and provisions hereof shall supersede the terms and conditions thereof.  The parties hereto further agree that this Agreement and the Credit Extensions shall serve to extend, renew and continue, but not to extinguish or novate, the “Credit Extensions” under the Existing Credit Agreement and the corresponding promissory notes and to amend, restate and supersede, but not to extinguish or cause to be novated the Indebtedness under, the Existing Credit Agreement.  The Borrower hereby agrees that, upon the effectiveness of this Agreement, the “Loans” made and outstanding under the Existing Credit Agreement and all accrued and unpaid interest thereon shall be deemed to be Loans outstanding under this Agreement and any Letters of Credit outstanding under the Existing Credit Agreement, if any, shall be deemed to be issued and outstanding as Letters of Credit hereunder.

 

10.21 Assignment and Reallocation of Commitments, Etc.  On the Closing Date, each of the lenders under the Existing Credit Agreement (each, an “Existing Lender”) hereby sells, assigns, transfers and conveys to the Lenders hereto, and each of the Lenders hereto hereby purchases and accepts, so much of the aggregate commitments under, and loans and participations in letters of credit outstanding under, the Existing Credit Agreement such that, immediately after giving effect to the effectiveness of this Agreement (including any increase of the commitments effectuated hereby), the Applicable Percentage of each Lender to this Agreement and the portion of the relevant Commitment of each Lender, shall be as set forth on Schedule 2.01 hereto (it being understood that if any Letters of Credit are outstanding under the Existing Credit Agreement as of the Closing Date of this Agreement, then each of the Lenders shall have purchased and accepted from the Existing Lenders, a participation in such outstanding Letters of Credit based on its respective Applicable Percentage).  The foregoing assignments, transfers and conveyances are without recourse to any Existing Lender and without any warranties whatsoever by the Administrative Agent, the Issuer or any Existing Lender as to title, enforceability, collectability, documentation or freedom from liens or encumbrances, in whole or in part, other than that the warranty of any such Existing Lender that it has not previously sold, transferred, conveyed or encumbered such interests.  The Existing Lenders and the Lenders shall, if appropriate, make all appropriate adjustments in payments under the Existing Credit Agreement, the “Notes” and the other “Loan Documents” thereunder for periods prior to the adjustment date among themselves, but in no event shall any such adjustment of Eurodollar Rate Loans (a) constitute a payment or prepayment of all or a portion of any Eurodollar Rate Loans or (b) entitle any Lender to any reimbursement under Section 3.05 hereof.

25516427                        -98-

 

 

  

  

  

 

10.22 ENTIRE AGREEMENT.  THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS REPRESENT THE FINAL AGREEMENT AMONG THE PARTIES AND MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS, OR SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES.  THERE ARE NO UNWRITTEN ORAL AGREEMENTS AMONG THE PARTIES.

25516427                        -99-

 

 

  

  

  

 

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed as of the date first above written.

 

	  	
PIONEER SOUTHWEST ENERGY

	  	
PARTNERS L.P.

	  	  	  
	 	By: 	 Pioneer Natural Resources GP LLC, its general
	  	
 

	 partner
	  	  	  
	  	
By:

	
/s/ Richard P. Dealy                                                                              

	  	
Name:

	
Richard P. Dealy

	  	
Title:

	
Executive Vice President and Chief

	  	  	
Financial Officer

 

 

 

 

S-1

 

  

  

  

 

	  	
BANK OF AMERICA, N.A., as

	  	
Administrative Agent

	  	  	  
	  	
By:

	
/s/ Ronald E. McKaig                                                                           

	  	
Name:

	
Ronald E. McKaig

	  	
Title:

	
Managing Director

 

 

 

USActive 25516427.8

S-2

 

 

 

  

  

  

 

	  	
BANK OF AMERICA, N.A., as a Lender, L/C

	  	
Issuer and Swing Line Lender

	  	  	  
	  	
By:

	
/s/ Ronald E. McKaig                                                                           

	  	
Name:

	
Ronald E. McKaig

	  	
Title:

	
Managing Director

 

 

USActive 25516427.8

S-3

 

 

  

  

  

 

	  	
WELLS FARGO BANK, N.A., as Syndication

	  	
Agent and a Lender

	  	  	  
	  	
By:

	
/s/ David C. Brooks                                                                              

	  	
Name:

	
David C. Brooks

	  	
Title:

	
Director

 

 

 

25516427

S-4

 

  

  

  

 

	  	
BMO HARRIS FINANCING, INC., as a Lender

	  	  
	  	  	  
	  	
By:

	
/s/ Kevin Utsey                                                                                   

	  	
Name:

	
Kevin Utsey

	  	
Title:

	
Director

 

 

 

25516427

S-5

 

 

  

  

  

 

	  	
CITIBANK, N.A., as Co-Documentation Agent

	  	
and a Lender

	  	  	  
	  	
By:

	
/s/ John F. Miller                                                                                 

	  	
Name:

	
John F. Miller

	  	
Title:

	
Attorney-in-Fact

 

25516427

S-6

 

  

  

  

 

	  	
BANK OF MONTREAL, as Co-Documentation

	  	
Agent

	  	  	  
	  	
By:

	
/s/ Kevin Utsey                                                                                   

	  	
Name:

	
Kevin Utsey

	  	
Title:

	
Director

 

 

25516427

S-7

 

 

  

  

  

 

	  	
THE BANK OF TOKYO-MITSUBISHI UFJ,

	  	
LTD., as a Lender

	  	  	  
	  	
By:

	
/s/ Maria Ferradas                                                                              

	  	
Name:

	
Maria Ferradas

	  	
Title:

	
Vice President

 

 

USActive 25516427.8

S-8

 

 

 

  

  

  

 

	  	
DEUTSCHE BANK AG NEW YORK

	  	
BRANCH, as a Lender

	  	  	  
	  	
By:

	
/c/ Virginia Cosenza                                                                             

	  	
Name:

	
Virginia Cosenza

	  	
Title:

	
Vice President

	  	  	  
	  	
By:

	
/s/ Ming K. Chu                                                                                   

	  	
Name:

	
Ming K. Chu

	  	
Title:

	
Vice President

 

 

25516427

S-9

 

  

  

  

 

	  	
DNB BANK ASA, GRAND CAYMAN

	  	
BRANCH, as a Lender

	  	  	  
	  	
By:

	
/s/ Evan Uhlick                                                                                   

	  	
Name:

	
Evan Uhlick

	  	
Title:

	
Vice President

	  	  	  
	  	
By:

	
/s/ Andrea Ozbolt                                                                               

	  	
Name:

	
Andrea Ozbolt

	  	
Title:

	
Vice President

 

 

25516427

S-10

 

 

  

  

  

 

	  	
JPMORGAN CHASE BANK, N.A., as a Lender

	  	  
	  	  	  
	  	
By:

	
/s/ Muhammad Hasan                                                                      

	  	
Name:

	
Muhammad Hasan

	  	
Title:

	
Vice President

 

25516427

S-11

 

 

  

  

  

 

	  	
ROYAL BANK OF CANADA, as a Lender

	  	  
	  	  	  
	  	
By:

	
/s/ Jay T. Sartain                                                                               

	  	
Name:

	
Jay T. Sartain

	  	
Title:

	
Authorized Signatory

 

25516427

S-12

 

 

  

  

  

 

	  	
THE ROYAL BANK OF SCOTLAND plc,

	  	
as a Lender

	  	  	  
	  	
By:

	
/s/ Brian D. Williams                                                                       

	  	
Name:

	
Brian D. Williams

	  	
Title:

	
Authorized Signatory

 

USActive 25516427.8

S-13

 

 

 

  

  

  

 

	  	
TORONTO DOMINION (TEXAS) LLC,

	  	
as a Lender

	  	  	  
	  	
By:

	
/s/ Kelly Hundal                                                                             

	  	
Name:

	
Kelly Hundal

	  	
Title:

	
Authorized Signatory

 

25516427

S-14

 

 

  

  

  

 

	  	
USB LOAN FINANCE LLC, as a Lender

	  	  
	  	  	  
	  	
By:

	
/s/ Irja R. Otsa                                                                             

	  	
Name:

	
Irja R. Otsa

	  	
Title:

	
Associate Director

	  	  	  
	  	
By:

	
/s/ Mary E. Evans                                                                      

	  	
Name:

	
Mary E. Evans

	  	
Title:

	
Associate Director

 

25516427

S-15

 

 

  

  

  

 

	  	
U.S. BANK NATIONAL ASSOCIATION, as a

	  	
Lender

	  	  	  
	  	
By:

	
/s/ Daria Mahoney                                                                   

	  	
Name:

	
Daria Mahoney

	  	
Title:

	
Vice President

 

25516427

S-16

 

  

  

  

 

SCHEDULE 2.01

 

 

 

COMMITMENTS

 

 

AND APPLICABLE PERCENTAGES

 

	
Lender

	
Commitment

	
Applicable Percentage

	
Bank of America, N.A.

	
$ 28,500,000.00

	
9.500000000%

	
Wells Fargo Bank, N.A.

	
$ 28,500,000.00

	
9.500000000%

	
BMO Capital Markets Financing, Inc.

	
$ 24,750,000.00

	
8.250000000%

	
Citibank, N.A.

	
$ 24,750,000.00

	
8.250000000%

	
The Bank of Tokyo-Mitsubishi UFJ, Ltd.

	
$ 21,500,000.00

	
7.166666667%

	
Deutsche Bank AG, New York Branch

	
$ 21,500,000.00

	
7.166666667%

	
DNB Bank ASA, Grand Cayman Branch

	
$ 21,500,000.00

	
7.166666667%

	
JPMorgan Chase Bank, N.A.

	
$ 21,500,000.00

	
7.166666667%

	
Royal Bank of Canada

	
$ 21,500,000.00

	
7.166666667%

	
The Royal Bank of Scotland plc

	
$ 21,500,000.00

	
7.166666667%

	
Toronto Dominion (TEXAS) LLC

	
$ 21,500,000.00

	
7.166666667%

	
UBS Loan Finance LLC

	
$ 21,500,000.00

	
7.166666667%

	
U.S. Bank National Association

	
$ 21,500,000.00

	
7.166666667%

	
 

Total

	
$ 300,000,000.00

	
100.000000000%

USActive 25516427.11                                                                                                                  

  Schedule 2.01

  

  

 

SCHEDULE 5.06

 

DISCLOSURE MATTERS

 

 

None

 

 

 

USActive 25516427.11                                                                                                               

  Schedule 5.06

  

  

 

SCHEDULE 5.12

 

SUBSIDIARIES AND

 

OTHER EQUITY INVESTMENTS

 

Part (a).                      Subsidiaries.

 

I.  Restricted Subsidiaries

 

Equity Interests Held by Borrower:

	
Name of Subsidiary

	
State of

Formation or

Organization

	
Percentage of

Equity

Interests Held

	
Nature of Business

	
Pioneer Southwest Energy

Partners USA LLC

	
Delaware

(converted

from Texas)

	
100%

	
Operating subsidiary of the

Borrower

	
PSE Finance Corporation

	
Delaware

	
100%

	
Inactive subsidiary

 

Equity Interests Held by Pioneer Southwest Energy Partners USA LLC and PSE Finance Corporation:  None

 

II.  Unrestricted Subsidiaries:  None

 

Part (b).                      Other Equity Investments.

 

None.

USActive 25516427.11                                                                                                                

  Schedule 5.12

  

  

 

SCHEDULE 5.14

 

GAS IMBALANCES

 

None

 

USActive 25516427.11                                                                                                              

  Schedule 5.14

  

  

 

SCHEDULE 5.15

 

MARKETING AGREEMENTS

 

 

None

 

 

USActive 25516427.11                                                                                                                 

  Schedule 5.15

  

  

 

SCHEDULE 7.02

 

EXISTING LIENS

 

 

None

 

 

 

 

USActive 25516427.11                                                                                                                

  Schedule 7.02

  

  

 

SCHEDULE 7.08

 

EXISTING RESTRICTIVE AGREEMENTS

 

 

None

 

 

 

USActive 25516427.11                                                                                                              

  Schedule 7.08

  

  

 

SCHEDULE 10.02

 

ADMINISTRATIVE AGENT’S OFFICE;

 

CERTAIN ADDRESSES FOR NOTICES

 

BORROWER:

 

Pioneer Southwest Energy Partners L.P.

5205 N. O’Connor Blvd., Suite 200

Irving, Texas 75039

Attention:  Richard P. Dealy

Telephone:  972-969-4054

Telecopier:  972-969-3572

Electronic Mail: rich.dealy@pxd.com

Website Address:  www.pioneersouthwest.com

U.S. Taxpayer Identification Number: 26-0388421

 

ADMINISTRATIVE AGENT:

 

Administrative Agent’s Office

(for payments and Requests for Credit Extensions):

Bank of America, N.A.

Bank of America Plaza

901 Main Street, 14th Floor

Dallas, TX 75202-3714

Attention:  Ms. Tonya Parker

Telephone:  (214) 209-2133

Facsimile:   (214) 290-9438:

Electronic Mail:  tonya.r.parker@bankofamerica.com

Account No.:  1292000883

Ref:  Pioneer Southwest Energy Partners - Tonya Parker

ABA# 026009593

 

Other Notices as Administrative Agent:

Bank of America, N.A.

Agency Management Officer

901 Main Street, 14th Floor

Mail Code:  TX1-492-14-11

Dallas, TX 75202-3714

Attention:  Renita Cummings

Telephone:  (214) 209-4130

Telecopier:  (214) 290-8371

Electronic Mail:  renita.m.cummings@bankofamerica.com

 

25516427 

-1-

Schedule 10.02

  

  

  

 

L/C ISSUER:

Bank of America, N.A.

Trade Operations

1000 West Temple Street, 7th Floor

Mail Code:  CA9-705-05

Los Angeles, CA 90012-1514

Attention: Bolivar Carrillo

Telephone:  (213) 481-7842

Telecopier:  (213) 457-8841

Electronic Mail:  bolivar.carrillo@bankofamerica.com

 

SWING LINE LENDER:

Bank of America, N.A.

Bank of America Plaza

901 Main Street, 14th Floor

Dallas, TX 75202

Attention:  Ms. Tonya Parker

Telephone:  (214) 209-2133

Facsimile:   (214) 290-9438:

Electronic Mail:  tonya.r.parker@bankofamerica.com

Account No.:  1292000883

Ref:  Pioneer Southwest Energy Partners - Tonya Parker

ABA# 026009593

 

25516427

-2-

Schedule 10.02

 

 

 

 

 

  

  

  

 

EXHIBIT A

 

FORM OF COMMITTED LOAN NOTICE

 

Date:  ___________, _____

 

 

To:           Bank of America, N.A., as Administrative Agent

 

Ladies and Gentlemen:

 

Reference is made to that certain Amended and Restated Credit Agreement, dated as of March __, 2012 (as amended, restated, extended, supplemented or otherwise modified in writing from time to time, the “Agreement;” the terms defined therein being used herein as therein defined), among Pioneer Southwest Energy Partners L.P., a Delaware limited partnership (the “Borrower”), the Lenders from time to time party thereto, Bank of America, N.A., as Administrative Agent, L/C Issuer and Swing Line Lender, Wells Fargo Bank, N.A., as Syndication Agent, and Merrill Lynch, Pierce, Fenner & Smith, Incorporated and Wells Fargo Securities, LLC, as Joint Lead Arrangers and Bookrunners.  Bank of Montreal and Citibank, N.A., as Co-Documentation Agents.

 

The undersigned hereby requests (select one):

 

o  A Borrowing of Committed Loans                                                           o   A conversion or continuation of Loans

 

	
  

	
1.

	
On _________________________________ (a Business Day).

 

	
  

	
2.

	
In the amount of $_______________.

 

	
  

	
3.

	
Comprised of ___________________.

 

	
  

	
[Type of Committed Loan requested]

 

	
  

	
4.

	
For Eurodollar Rate Loans:  with an Interest Period of ___ months.

 

The Committed Borrowing, if any, requested herein complies with the provisos to the first sentence of Section 2.01 of the Agreement.

 

25516427

A-1

Form of Committed Loan Notice

 

 

  

  

  

 

	  	
PIONEER SOUTHWEST ENERGY

	  	
PARTNERS L.P.

	  	  	  
	 	By: 	 Pioneer Natural Resources GP LLC, its general
	  	
 

	 partner
	  	  	  
	  	
By:

	                                                                                                   
	  	
Name:

	  
	  	
Title:

	  
	  	  	  

 

 

 

25516427

A -2

Form of Committed Loan Notice

 

 

  

  

  

 

EXHIBIT B

 

FORM OF SWING LINE LOAN NOTICE

 

Date:  ___________, _____

 

 

	
To:

	
Bank of America, N.A., as Swing Line Lender

 

	
  

	
Bank of America, N.A., as Administrative Agent

 

Ladies and Gentlemen:

 

Reference is made to that certain Amended and Restated Credit Agreement, dated as of March __, 2012 (as amended, restated, extended, supplemented or otherwise modified in writing from time to time, the “Agreement;” the terms defined therein being used herein as therein defined), among Pioneer Southwest Energy Partners L.P., a Delaware limited partnership (the “Borrower”), the Lenders from time to time party thereto, Bank of America, N.A., as Administrative Agent, L/C Issuer and Swing Line Lender, Wells Fargo Bank, N.A., as Syndication Agent, and Merrill Lynch, Pierce, Fenner & Smith, Incorporated and Wells Fargo Securities, LLC, as Joint Lead Arrangers and Bookrunners.  Bank of Montreal and Citibank, N.A., as Co-Documentation Agents.

 

The undersigned hereby requests a Swing Line Loan:

 

	
  

	
1.

	
On ________________________ (a Business Day).

 

	
  

	
2.

	
In the amount of $______________.

 

The Swing Line Borrowing requested herein complies with the requirements of the provisos to the first sentence of Section 2.04(a) of the Agreement.

 

	  	
PIONEER SOUTHWEST ENERGY

	  	
PARTNERS L.P.

	  	  	  
	 	By: 	 Pioneer Natural Resources GP LLC, its general
	  	
 

	 partner
	  	  	  
	  	
By:

	                                                                                                 
	  	
Name:

	  
	  	
Title:

	  
	  	  	  

 

25516427

B-1

Form of Swing Line Loan Notice

 

 

 

  

  

  

 

EXHIBIT C

 

FORM OF NOTE

 

_________________

 

 

FOR VALUE RECEIVED, the undersigned (the “Borrower”) hereby promises to pay to _____________________ or registered assigns (the “Lender”), in accordance with the provisions of the Agreement (as hereinafter defined), the principal amount of each Loan from time to time made by the Lender to the Borrower under that certain Amended and Restated Credit Agreement, dated as of March __, 2012 (as amended, restated, extended, supplemented or otherwise modified in writing from time to time, the “Agreement;” the terms defined therein being used herein as therein defined), among the Borrower, the Lenders from time to time party thereto, Bank of America, N.A., as Administrative Agent, L/C Issuer and Swing Line Lender, Wells Fargo Bank, N.A., as Syndication Agent, and Merrill Lynch, Pierce, Fenner & Smith Incorporated and Wells Fargo Securities, LLC, as Joint Lead Arrangers and Bookrunners.  Bank of Montreal and Citibank, N.A., as Co-Documentation Agents.

 

The Borrower promises to pay interest on the unpaid principal amount of each Loan from the date of such Loan until such principal amount is paid in full, at such interest rates and at such times as provided in the Agreement.  Except as otherwise provided in Section 2.04(f) of the Agreement with respect to Swing Line Loans, all payments of principal and interest shall be made to the Administrative Agent for the account of the Lender in Dollars in immediately available funds at the Administrative Agent’s Office.  If any amount is not paid in full when due hereunder, such unpaid amount shall bear interest, to be paid upon demand, from the due date thereof until the date of actual payment (and before as well as after judgment) computed at the per annum rate set forth in the Agreement.

 

This Note is one of the Notes referred to in the Agreement, is entitled to the benefits thereof and may be prepaid in whole or in part subject to the terms and conditions provided therein.  This Note is also entitled to the benefits of the Guaranty.  Upon the occurrence and continuation of one or more of the Events of Default specified in the Agreement, all amounts then remaining unpaid on this Note shall become, or may be declared to be, immediately due and payable all as provided in the Agreement.  Loans made by the Lender shall be evidenced by one or more loan accounts or records maintained by the Lender in the ordinary course of business. The Lender may also attach schedules to this Note and endorse thereon the date, amount and maturity of its Loans and payments with respect thereto.

 

The Borrower, for itself, its successors and assigns, hereby waives diligence, presentment, protest and demand and notice of protest, demand, dishonor and non-payment of this Note.

 

25516427

C-1

Form of Note

 

 

 

 

 

 

THIS NOTE SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF TEXAS.

	  	
PIONEER SOUTHWEST ENERGY

	  	
PARTNERS L.P.

	  	  	  
	 	By: 	 Pioneer Natural Resources GP LLC, its general
	  	
 

	 partner
	  	  	  
	  	
By:

	                                                                                                            
	  	
Name:

	  
	  	
Title:

	  
	  	  	  

 

LOANS AND PAYMENTS WITH RESPECT THERETO

 

	
Date

	
Type of 

Loan Made

	
Amount of 

Loan Made

	
End of 

Interest

Period

	
Amount of 

Principal or 

Interest 

Paid This

Date

	
Outstanding 

Principal 

Balance 

This Date

	
Notation 

Made By

	  	  	  	  	  	  	  
	  	  	  	  	  	  	  
	  	  	  	  	  	  	  
	  	  	  	  	  	  	  
	  	  	  	  	  	  	  
	  	  	  	  	  	  	  
	  	  	  	  	  	  	  
	  	  	  	  	  	  	  
	  	  	  	  	  	  	  
	  	  	  	  	  	  	  
	  	  	  	  	  	  	  
	  	  	  	  	  	  	  
	  	  	  	  	  	  	  
	  	  	  	  	  	  	  
	  	  	  	  	  	  	  
	  	  	  	  	  	  	  
	  	  	  	  	  	  	  
	  	  	  	  	  	  	  

 

25516427

C-2

Form of Note

 

 

 

  

  

  

 

EXHIBIT D

 

FORM OF COMPLIANCE CERTIFICATE

Financial Statement Date:  ____ ,

 

 

To:           Bank of America, N.A., as Administrative Agent

 

Ladies and Gentlemen:

 

Reference is made to that certain Amended and Restated Credit Agreement, dated as of March __, 2012 (as amended, restated, extended, supplemented or otherwise modified in writing from time to time, the “Agreement;” the terms defined therein being used herein as therein defined), among Pioneer Southwest Energy Partners L.P., a Delaware limited partnership (the “Borrower”), the Lenders from time to time party thereto, Bank of America, N.A., as Administrative Agent, L/C Issuer and Swing Line Lender, Wells Fargo Bank, N.A., as Syndication Agent, and Merrill Lynch, Pierce, Fenner & Smith Incorporated and Wells Fargo Securities, LLC, as Joint Lead Arrangers and Bookrunners.  Bank of Montreal and Citibank, N.A., as Co-Documentation Agents.

 

The undersigned Responsible Officer hereby certifies as of the date hereof that he/she is the ________________________ of the Borrower, and that, as such, he/she is authorized to execute and deliver this Certificate to the Administrative Agent on the behalf of the Borrower, and that:

 

[Use following paragraph 1 for fiscal year-end financial statements]

 

1.           The Borrower has delivered the year-end audited financial statements required by Section 6.01(a) of the Agreement for the fiscal year of the Borrower ended as of the above date, together with the report and opinion of an independent certified public accountant required by such section.

 

[Use following paragraph 1 for fiscal quarter-end financial statements]

 

1.           The Borrower has delivered the unaudited financial statements required by Section 6.01(b) of the Agreement for the fiscal quarter of the Borrower ended as of the above date.  Such financial statements fairly present the financial condition, results of operations and cash flows of the Borrower and its Subsidiaries in accordance with GAAP as at such date and for such period, subject only to normal year-end audit adjustments and the absence of footnotes.

 

2.           The undersigned has reviewed and is familiar with the terms of the Agreement and has made, or has caused to be made under his/her supervision, a detailed review of the transactions and condition (financial or otherwise) of the Borrower during the accounting period covered by such financial statements.

 

 

25516427

D-1

Form of Compliance Certificate

 

  

  

  

 

 

3.           A review of the activities of the Borrower during such fiscal period has been made under the supervision of the undersigned with a view to determining whether during such fiscal period the Borrower performed and observed all its Obligations under the Loan Documents, and

 

[select one:]

 

[to the best knowledge of the undersigned, during such fiscal period the Borrower performed and observed each covenant and condition of the Loan Documents applicable to it, and no Default has occurred and is continuing.]

 

--or--

 

[to the best knowledge of the undersigned, during such fiscal period the following covenants or conditions have not been performed or observed and the following is a list of each such Default and its nature and status:]

 

4.           The representations and warranties of the Borrower contained in Article V of the Agreement, and any representations and warranties of any Loan Party that are contained in any document furnished at any time under or in connection with the Loan Documents, are true and correct on and as of the date hereof, except to the extent that such representations and warranties specifically refer to an earlier date, in which case they are true and correct as of such earlier date, and except that for purposes of this Compliance Certificate, the representations and warranties contained in subsections (a) and (b) of Section 5.04 of the Agreement shall be deemed to refer to the most recent statements furnished pursuant to clauses (a) and (b), respectively, of Section 6.01 of the Agreement, including the statements in connection with which this Compliance Certificate is delivered.

 

5.           The financial covenant analyses and information set forth on Schedules 1 and 2 attached hereto are true and accurate on and as of the date of this Certificate.

 

IN WITNESS WHEREOF, the undersigned has executed this Certificate as of _______________, __________.

 

	  	
PIONEER SOUTHWEST ENERGY

	  	
PARTNERS L.P.

	  	  	  
	  	
By:

	  Pioneer Natural Resources GP LLC, its general
	  	  	  partner
	 	 	 
	  	
By:

	                                                                                                                  
	  	
Name:

	  
	  	
Title:

	  
	  	  	  

 

 

 

25516427

D-2

Form of Compliance Certificate

 

 

  

  

  

 

For the Quarter/Year ended ___________________(“Statement Date”)

 

SCHEDULE 1

 

to the Compliance Certificate

 

($ in 000’s)

 

 

	
I.

	
Section 7.04 (a) – PV to Consolidated Indebtedness Ratio.

	  	  	  
	  	
A.

	
PV at Statement Date:

	  	  	  
	  	  	
1.  PV relating to Proved Reserves

	
$

	
__________

	  
	  	  	
2.  PV related to Midstream Assets

	
$

	
__________

	  
	  	  	
PV (Line II.A.1 + Line II.A.2):

	
$

	
__________

	  
	  	
B.

	
Consolidated Indebtedness at Statement Date:

	
$

	
__________

	  
	  	
C.

	
PV to Consolidated Indebtedness Ratio (Line III.A  ̧ Line III.B):

	  	
______ to 1

	  
	  	
D.

	
Minimum Required PV to Consolidated Indebtedness Ratio:

	  	
1.75 to 1

	  
	  	  	  	  	  	  
	
II.

	
Section 7.04 (b) – Consolidated Leverage Ratio.

	  	  	  
	  	
A.

	
Consolidated Indebtedness at Statement Date:

	
$

	
__________

	  
	  	
B.

	
Consolidated Adjusted EBITDAX for Subject Period (Line I.A.):

	
$

	
__________

	  
	  	
C.

	
Consolidated Leverage Ratio (Line III. A  ̧ Line III.B):

	  	
______ to 1

	  
	  	
D.

	
Maximum Permitted Consolidated Leverage Ratio

	  	
[3.50 to 1]3

	  
	  	  	  	  	  	  

 

___________________

3      If Compliance Certificate is being submitted during an Acquisition Period, note such fact and revise Maximum Permitted Consolidated Leverage Ratio to read 4.00 to 1.

 

 

25516427

D-3

Form of Compliance Certificate

 

 

 

 

  

  

  

 

For the Quarter/Year ended ___________________(“Statement Date”)

 

SCHEDULE 2

 

to the Compliance Certificate

 

($ in 000’s)

 

Consolidated EBITDAX and Consolidated Adjusted EBITDAX

 

 

(in accordance with the definition of Consolidated EBITDAX and Consolidated Adjusted EBITDAX as set forth in the Agreement)

 

	
Consolidated

EBITDAX

	
Quarter

Ended

	
Quarter

Ended

	
Quarter

Ended

	
Quarter

Ended

	
Twelve Months

Ended

	
Consolidated

Net Income

	  	  	  	  	  
	
+Consolidated Interest Charges

	  	  	  	  	  
	
+income taxes

	  	  	  	  	  
	
+depreciation expense

	  	  	  	  	  
	
+depletion expense

	  	  	  	  	  
	
+amortization expense

	  	  	  	  	  
	
+non-cash losses (SFAS 133)

	  	  	  	  	  
	
+non-cash losses (SFAS 143/144)

	  	  	  	  	  
	
+exploration costs

	  	  	  	  	  
	
+abandonment expenses

	  	  	  	  	  
	
+non-cash equity based compensation expenses

	  	  	  	  	  
	
+non-cash losses on asset disposition

	  	  	  	  	  
	
+non-recurring non-cash expenses

	  	  	  	  	  
	
-income tax credits

	  	  	  	  	  
	
-non-cash credits (SFAS 133)

	  	  	  	  	  
	
-non-cash gains on asset disposition

	  	  	  	  	  
	
-non-cash income

	  	  	  	  	  
	
=Consolidated EBITDAX

	  	  	  	  	  

 

 

25516427

D-4

Form of Compliance Certificate

 

  

  

  

 

	
Consolidated

Adjusted

EBITDAX

	
Quarter

Ended

	
Quarter

Ended

	
Quarter

Ended

	
Quarter

Ended

	
Twelve Months

Ended

	
Consolidated

EBITDAX

	  	  	  	  	  
	
+Adjustment for acquisition or disposition

	  	  	  	  	  
	
+other pro forma adjustments

	  	  	  	  	  
	
-income tax credits

	  	  	  	  	  
	
-non-cash income

	  	  	  	  	  
	
=Consolidated Adjusted

EBITDAX

	  	  	  	  	  

 

 

25516427

D-5

Form of Compliance Certificate

 

 

 

 

  

  

  

 

EXHIBIT E

 

ASSIGNMENT AND ASSUMPTION

 

This Assignment and Assumption (this “Assignment and Assumption”) is dated as of the Effective Date set forth below and is entered into by and between [the][each]4 Assignor identified in item 1 below ([the][each, an] “Assignor”) and [the][each]5 Assignee identified in item 2 below ([the][each, an] “Assignee”).  [It is understood and agreed that the rights and obligations of [the Assignors][the Assignees]6 hereunder are several and not joint.]7  Capitalized terms used but not defined herein shall have the meanings given to them in the Amended and Restated Credit Agreement identified below (the “Credit Agreement”), receipt of a copy of which is hereby acknowledged by the Assignee.  The Standard Terms and Conditions set forth in Annex 1 attached hereto are hereby agreed to and incorporated herein by reference and made a part of this Assignment and Assumption as if set forth herein in full.

 

For an agreed consideration, [the][each] Assignor hereby irrevocably sells and assigns to [the Assignee][the respective Assignees], and [the][each] Assignee hereby irrevocably purchases and assumes from [the Assignor][the respective Assignors], subject to and in accordance with the Standard Terms and Conditions and the Credit Agreement, as of the Effective Date inserted by the Administrative Agent as contemplated below (i) all of [the Assignor’s][the respective Assignors’] rights and obligations in [its capacity as a Lender][their respective capacities as Lenders] under the Credit Agreement and any other documents or instruments delivered pursuant thereto to the extent related to the amount and percentage interest identified below of all of such outstanding rights and obligations of [the Assignor][the respective Assignors] under the respective facilities identified below (including, without limitation, the Letters of Credit and the Swing Line Loans included in such facilities) and (ii) to the extent permitted to be assigned under applicable law, all claims, suits, causes of action and any other right of [the Assignor (in its capacity as a Lender)][the respective Assignors (in their respective capacities as Lenders)] against any Person, whether known or unknown, arising under or in connection with the Credit Agreement, any other documents or instruments delivered pursuant thereto or the loan transactions governed thereby or in any way based on or related to any of the foregoing, including, but not limited to, contract claims, tort claims, malpractice claims, statutory claims and all other claims at law or in equity related to the rights and obligations sold and assigned pursuant to clause (i) above (the rights and obligations sold and assigned by [the][any] Assignor to [the][any] Assignee pursuant to clauses (i) and (ii) above being referred to herein collectively 

 

____________

4      For bracketed language here and elsewhere in this form relating to the Assignor(s), if the assignment is from a single Assignor, choose the first bracketed language.  If the assignment is from multiple Assignors, choose the second bracketed language.

  

5      For bracketed language here and elsewhere in this form relating to the Assignee(s), if the assignment is to a single Assignee, choose the first bracketed language.  If the assignment is to multiple Assignees, choose the second bracketed language.

  

6      Select as appropriate.

  

7      Include bracketed language if there are either multiple Assignors or multiple Assignees.

  

25516427

E-1

Form of Assignment and Assumption

 

  

  

  

 

 

as [the][an] “Assigned Interest”).  Each such sale and assignment is without recourse to [the][any] Assignor and, except as expressly provided in this Assignment and Assumption, without representation or warranty by [the][any] Assignor.

 

	
  

	
1.

	
Assignor[s]:

	
______________________________

 

	
  

	
______________________________

 

	
  

	
2.

	
Assignee[s]:

	
______________________________

 

	
  

	
______________________________

 

	
  

	
[for each Assignee, indicate [Affiliate][Approved Fund] of [identify Lender]]

 

	
  

	
3.

	
Borrower(s):

	
Pioneer Southwest Energy Partners L.P., a Delaware limited partnership

 

	
  

	
4.

	
Administrative Agent: Bank of America, N.A., as the administrative agent under the Credit Agreement

 

	
  

	
5.

	
Credit Agreement:

	
Amended and Restated Credit Agreement, dated as of March __, 2012, among Pioneer Southwest Energy Partners L.P., a Delaware limited partnership, as Borrower, the Lenders from time to time party thereto, Bank of America, N.A., as Administrative Agent, L/C Issuer, and Swing Line Lender, Wells Fargo Bank, N.A., as Syndication Agent, and Merrill Lynch, Pierce, Fenner & Smith Incorporated and Wells Fargo Securities, LLC, as Joint Lead Arrangers and Bookrunners.  Bank of Montreal and Citibank, N.A., as Co-Documentation Agents.

 

	
  

	
6.

	
Assigned Interest[s]:

	
Assignor[s]8

	
Assignee[s]9

	
Revolving Credit Commitment Assigned

	
Aggregate Amount of Commitment

for all Lenders10

	
Amount of Commitment Assigned

	
Percentage Assigned of Commitment

	
CUSIP Number

	  	  	  	  	  	  	  
	  	  	
____________

	
$________________

	
$_________

	
____________%

	  
	  	  	
____________

	
$________________

	
$_________

	
____________%

	  
	  	  	
____________

	
$________________

	
$_________

	
____________%

	  
	  	  	  	  	  	  	  

 

	
  

	
[7.

	
Trade Date:

	
__________________]11

 

 

 _____________

8      List each Assignor, as appropriate.

  

9      List each Assignee, as appropriate.

  

10      Amounts in this column and in the column immediately to the right to be adjusted by the counterparties to take into account any payments or prepayments made between the Trade Date and the Effective Date.

  

11      To be completed if the Assignor and the Assignee intend that the minimum assignment amount is to be determined as of the Trade Date.

  

25516427

E-2

Form of Assignment and Assumption

 

  

  

  

 

 

Effective Date: __________________, 20__ [TO BE INSERTED BY ADMINISTRATIVE AGENT AND WHICH SHALL BE THE EFFECTIVE DATE OF RECORDATION OF TRANSFER IN THE REGISTER THEREFOR.]

 

The terms set forth in this Assignment and Assumption are hereby agreed to:

 

	  	
ASSIGNOR

	  	
[NAME OF ASSIGNOR]

	  	  	  
	  	  	  
	  	
By:

	                                                                                                          
	  	  	
Title:

	  	  	  
	  	  	  
	  	
ASSIGNEE

	  	
[NAME OF ASSIGNEE]

	  	  	  
	  	  	  
	  	
By:

	                                                                                                          
	  	  	
Title:

 [Consented to and]12 Accepted:

BANK OF AMERICA, N.A., as

  Administrative Agent

 

By:                                                                      

 

      Title:

 

[Consented to:]13

 

By:                                                                      

 

      Title:

 

_____________

12      To be added only if the consent of the Administrative Agent is required by the terms of the Credit Agreement.

  

13      To be added only if the consent of the Borrower and/or other parties (e.g. Swing Line Lender, L/C Issuer) is required by the terms of the Credit Agreement.

 

 

25516427

E-3

Form of Assignment and Assumption

 

 

 

 

  

  

  

 

ANNEX 1 TO ASSIGNMENT AND ASSUMPTION

 

[___________________]14

 

 

STANDARD TERMS AND CONDITIONS FOR

 

 

ASSIGNMENT AND ASSUMPTION

 

1.           Representations and Warranties.

 

1.1           Assignor.  [The][Each] Assignor (a) represents and warrants that (i) it is the legal and beneficial owner of [the][[the relevant] Assigned Interest, (ii) [the][such] Assigned Interest is free and clear of any lien, encumbrance or other adverse claim and (iii) it has full power and authority, and has taken all action necessary, to execute and deliver this Assignment and Assumption and to consummate the transactions contemplated hereby; and (b) assumes no responsibility with respect to (i) any statements, warranties or representations made in or in connection with the Credit Agreement or any other Loan Document, (ii) the execution, legality, validity, enforceability, genuineness, sufficiency or value of the Loan Documents or any collateral thereunder, (iii) the financial condition of the Borrower, any of its Subsidiaries or Affiliates or any other Person obligated in respect of any Loan Document or (iv) the performance or observance by the Borrower, any of its Subsidiaries or Affiliates or any other Person of any of their respective obligations under any Loan Document.

 

1.2           Assignee.  [The][Each] Assignee (a) represents and warrants that (i) it has full power and authority, and has taken all action necessary, to execute and deliver this Assignment and Assumption and to consummate the transactions contemplated hereby and to become a Lender under the Credit Agreement, (ii) it meets all the requirements to be an assignee under Section 10.06(b)(iii), (v) and (vi) of the Credit Agreement (subject to such consents, if any, as may be required under Section 10.06(b)(iii) of the Credit Agreement), (iii) from and after the Effective Date, it shall be bound by the provisions of the Credit Agreement as a Lender thereunder and, to the extent of [the][the relevant] Assigned Interest, shall have the obligations of a Lender thereunder, (iv) it is sophisticated with respect to decisions to acquire assets of the type represented by [the][such] Assigned Interest and either it, or the Person exercising discretion in making its decision to acquire [the][such] Assigned Interest, is experienced in acquiring assets of such type, (v) it has received a copy of the Credit Agreement, and has received or has been accorded the opportunity to receive copies of the most recent financial statements delivered pursuant to Section __ thereof, as applicable, and such other documents and information as it deems appropriate to make its own credit analysis and decision to enter into this Assignment and Assumption and to purchase [the][such] Assigned Interest, (vi) it has, independently and without reliance upon the Administrative Agent or any other Lender and based on such documents and information as it has deemed appropriate, made its own credit analysis and decision to enter into this Assignment and Assumption and to purchase [the][such] Assigned Interest, and (vii) if it is a Foreign Lender, attached hereto is any documentation required to be delivered by it pursuant to 

 

______________

14      Describe Credit Agreement at option of Administrative Agent.

25516427

E-4

Form of Assignment and Assumption

 

  

  

  

 

the terms of the Credit Agreement, duly completed and executed by [the][such] Assignee; and (b) agrees that (i) it will, independently and without reliance upon the Administrative Agent, [the][any] Assignor or any other Lender, and based on such documents and information as it shall deem appropriate at the time, continue to make its own credit decisions in taking or not taking action under the Loan Documents, and (ii) it will perform in accordance with their terms all of the obligations which by the terms of the Loan Documents are required to be performed by it as a Lender.

 

2.           Payments.  From and after the Effective Date, the Administrative Agent shall make all payments in respect of [the][each] Assigned Interest (including payments of principal, interest, fees and other amounts) to [the][the relevant] Assignor for amounts which have accrued to but excluding the Effective Date and to [the][the relevant] Assignee for amounts which have accrued from and after the Effective Date.

 

3.           General Provisions.  This Assignment and Assumption shall be binding upon, and inure to the benefit of, the parties hereto and their respective successors and assigns.  This Assignment and Assumption may be executed in any number of counterparts, which together shall constitute one instrument.  Delivery of an executed counterpart of a signature page of this Assignment and Assumption by telecopy shall be effective as delivery of a manually executed counterpart of this Assignment and Assumption.  This Assignment and Assumption shall be governed by, and construed in accordance with, the law of the State of Texas.

 

 

25516427

E-5

Form of Assignment and Assumption

 

 

 

  

  

  

 

EXHIBIT F

 

FORM OF FIRST AMENDMENT TO GUARANTY

 

 

[attached]

 

 

 

 

 

 

25516427

F-1

Form of Guaranty

 

 

 

  

  

  

 

FIRST AMENDMENT TO GUARANTY

 

THIS FIRST AMENDMENT TO GUARANTY (this “Amendment”) is entered into as of March 29, 2012 by each Restricted Subsidiary (such capitalized term and other terms used in this Amendment to have the meanings set forth in Section 1) of Pioneer Southwest Energy Partners L.P., a Delaware limited partnership (the “Borrower”), from time to time a party hereto (each individually a “Guarantor” and, collectively the “Guarantors”), in favor of BANK OF AMERICA, N.A., in its capacity as the administrative agent (together with its successor(s) thereto in such capacity, the “Administrative Agent”) for the benefit of each of the Guaranteed Creditors.

 

WHEREAS, Pioneer Southwest Energy Partners USA LLC has entered into that certain Guaranty in favor of Administrative Agent, dated as of May 6, 2008 (the “Guaranty”); and

 

WHEREAS, PSE Finance Corporation has entered into that certain Supplement to Guaranty in favor of Administrative Agent, dated as of August 31, 2009 (the “Supplement to Guaranty”); and

 

WHEREAS, PSE Finance Corporation became a Guarantor under the Guaranty pursuant to that Supplement to Guaranty; and

 

WHEREAS, each of the Guarantors and Administrative Agent desire to amend the Guaranty as more specifically set forth herein.

 

NOW THEREFORE, in consideration of the premises and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, Guarantors and Administrative Agent hereby agree as follows:

 

Section 1.  Definitions. Unless otherwise indicated, capitalized terms that are used but not defined herein shall have the meanings ascribed to them in the Guaranty.

 

Section 2.  Amendment.  The first recital of the guaranty is hereby amended and restated in its entirety as follows:

 

“WHEREAS, pursuant to that certain Amended and Restated Credit Agreement, dated as of March 29, 2012 (as amended, supplemented, amended and restated or otherwise modified from time to time, the “Credit Agreement”), by and among the Borrower, the various financial institutions and other Persons from time to time party thereto and the Administrative Agent, the Lenders and L/C Issuer have extended Commitments to make Loans to, and issue Letters of Credit for the account of, the Borrower; and”

 

Section 3.  Reaffirmation.  Each Guarantor hereby absolutely and unconditionally reaffirms its obligations under the Guaranty, as amended hereby.

 

25620572

 

 

  

  

  

 

Section 4.  Representations and Warranties.  As of the date of this Amendment (except to the extent specifically related to a different date), all representations and warranties of each Guarantor contained in the Guaranty are true and correct in all material respects and each Guarantor hereby confirms each such representation and warranty made by it with the same effect as if set forth in full herein

 

Section 5.  Limited Effect.  Except as expressly set forth herein, the Guaranty remains unmodified and in full force and effect.  After the date hereof, all references in the Guaranty to “this Agreement”, “this Guaranty”, “hereof”, “herein” or words of similar effect in referring to the Guaranty shall be deemed to be references to the Guaranty as amended by this Amendment.

 

Section 6.  Conditions to Effectiveness.  This Amendment shall be effective as of the first date Administrative Agent shall have received a counterpart of this Amendment duly executed by the parties hereto.

 

Section 7.  Counterparts.  This Amendment may be executed in counterparts, each of which when so executed shall be deemed to be an original and all of which when taken together shall constitute one and the same agreement. Delivery of an executed counterpart hereof by facsimile or other electronic means shall be deemed to be an original.

 

Section 8.  Governing Law.  THIS AMENDMENT SHALL BE GOVERNED BY, AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF TEXAS.

 

Section 9.  Headings. Section headings in this Amendment are included herein for convenience of reference only and shall not constitute a part of this Amendment or are given any substantive effect.

 

[Signature Page Follows]

 

 

 

 

25620572

 -2-

 

 

 

  

  

  

 

IN WITNESS WHEREOF the undersigned have caused this Amendment to be duly executed by its officers thereunto duly authorized as of the date first above written.

 

	  	
PIONEER SOUTHWEST ENERGY

	  	
PARTNERS USA LLC

	  	  	  
	  	
By:

	
PIONEER SOUTHWEST ENERGY

	  	  	
PARTNERS L.P., its sole member

	  	  	  
	  	
By:

	
PIONEER NATURAL RESOURCES GP

	  	  	
LLC, its general partner

	  	  	  
	  	  	  
	  	
By:

	                                                                                                            
	  	
Name:

	
Richard P. Dealy

	  	
Title:

	
Executive Vice President and Chief

	  	  	
Financial Officer

 

	  	
PSE FINANCE CORPORATION

	  	  	  
	  	  	  
	  	  	  
	  	
By:

	                                                                                                           
	  	
Name:

	
Richard P. Dealy

	  	
Title:

	
Executive Vice President and Chief

	  	  	
Financial Officer

 

 

 

25620572

[First Amendment to Guaranty]

 

  

  

  

 

	  	
ACCEPTED AND AGREED FOR ITSELF

	  	
AND ON BEHALF OF THE GUARANTEED

	  	
CREDITORS:

	  	  
	  	  
	  	
BANK OF AMERICA, N.A., as

Administrative Agent

	  	  	  
	  	  	  
	  	  	  
	  	
By:

	                                                                                                
	  	
Name:

	
Ronald E. McKaig

	  	
Title:

	
Managing Director

	  	  	  

 

 

 

25620572

[First Amendment to Guaranty]

 

 

  

  

  

 

EXHIBIT G

 

OPINION MATTERS

 

The matters contained in the following Sections of the Credit Agreement should be covered by the legal opinion:

 

	
·  

	
Section 5.01

 

	
·  

	
Section 5.02

 

	
·  

	
Section 5.03

 

	
·  

	
Section 5.06

 

	
·  

	
Section 5.08

 

 

 

25516427

G-1

Opinion Matters

 

 

  

  

  

 

EXHIBIT H

 

GENERAL PARTNER CERTIFICATE

 

March __, 2012

 

 

The Lenders and L/C Issuer party to the Credit Agreement

 

  referred to below

 

Bank of America, N.A.,

 

  as Administrative Agent (as defined below)

 

Ladies and Gentlemen,

 

Reference is hereby made to that certain Amended and Restated Credit Agreement, dated as of March __, 2012 (together with all amendments and other modifications, if any, from time to time thereafter made thereto, the “Credit Agreement”), among Pioneer Southwest Energy Partners L.P., a Delaware limited partnership (the “Borrower”), the various financial institutions as are or may become parties thereto (collectively, the “Lenders”), Bank of America, N.A., as letter of credit issuer (the “L/C Issuer”), Bank of America, N.A., as administrative agent for the Lenders (in such capacity together with its successors in such capacity, the “Administrative Agent”), Wells Fargo Bank, N.A., as syndication agent, and Merrill Lynch, Pierce, Fenner & Smith Incorporated and Wells Fargo Securities, LLC, as Joint Lead Arrangers and Bookrunners.  Unless otherwise defined herein or the context otherwise requires, capitalized terms used herein have the same meanings as set forth in the Credit Agreement.

 

In consideration of the Lenders, L/C Issuer and the Administrative Agent entering into the Credit Agreement, Pioneer Natural Resources GP LLC, a Delaware limited liability company and the sole general partner of the Borrower (the “General Partner”), hereby agrees that, for so long as it is a general partner of the Borrower, (a) its sole business will be to act as the general partner of the Borrower and as a member, partner or stockholder of any limited liability company, limited partnership or corporation of which any Loan Party, or any of their Subsidiaries, is, directly or indirectly, a limited partner and to undertake activities that are ancillary or related thereto (including being a limited partner in the Borrower), (b) it shall not enter into or conduct any business or incur any debts or liabilities except in connection with or incidental to (i) its performance of the activities required or authorized by the Partnership Agreement, and (ii) the acquisition, ownership or disposition of partnership interests in the MLP or any further limited partnership of which the Borrower or any other Loan Party is, directly or indirectly, a limited partner; and (c) it shall not take any action or refuse to take any reasonable action the effect of which, if taken or not taken, as the case may be, would be to cause Borrower to be treated as an association taxable as a corporation or otherwise to be taxed as an entity other than a partnership for Federal income tax purposes.

 

 

 

25516427

H-1

General Partner Certificate

 

  

  

  

 

 

General Partner hereby acknowledges that its agreements contained herein are an inducement to the Lenders, the L/C Issuer and the Administrative Agent entering into the Credit Agreement and that this letter is, and shall be deemed to be, a Loan Document.

 

THIS LETTER SHALL BE GOVERNED BY THE LAWS OF THE STATE OF TEXAS (WITHOUT REGARD TO ANY CONFLICTS OF LAW PRINCIPLES THAT WOULD REQUIRE THE APPLICATION OF THE LAW OF ANY OTHER JURISDICTION).

 

 

	  	
Very truly yours,

	  	  
	  	
PIONEER NATURAL RESOURCES GP LLC

	  	  
	  	  	  
	  	
By:

	                                                                                                    
	  	  	
Name:

	  	  	
Title:

	  	  	  

 

 

25516427

H-2

General Partner Certificate

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