FOURTH AMENDED AND RESTATED
CREDIT AGREEMENT
This
AMENDMENT NO. 2 to FOURTH AMENDED AND RESTATED CREDIT AGREEMENT
(the “ Amendment ”), dated as of May 28,
2009, is entered into by and among Tesoro Corporation (the “
Borrower ”), the financial institutions party to the
below-defined Credit Agreement (the “ Lenders
”), and JPMorgan Chase Bank, National Association, as
Administrative Agent (the “ Agent ”). Each
capitalized term used herein and not otherwise defined herein shall
have the meaning given to it in the below-defined Credit
Agreement.
WHEREAS,
the Borrower, the Lenders, and the Agent are parties to a Fourth
Amended and Restated Credit Agreement dated as of May 11, 2007
(as the same may be amended, restated, supplemented or otherwise
modified from time to time, the “ Credit Agreement
”); and
WHEREAS,
the Borrower wishes to amend the Credit Agreement in certain
respects and the Lenders party hereto and the Agent are willing to
amend the Credit Agreement on the terms and conditions set forth
herein;
NOW,
THEREFORE, in consideration of the premises set forth above, the
terms and conditions contained herein, and other good and valuable
consideration, the receipt and sufficiency of which are hereby
acknowledged, the Borrower, the Agent and the Lenders party hereto
hereby agree as follows:
1.
Amendments to Credit Agreement . Effective as of the date
first above written, and subject to the satisfaction of the
conditions to effectiveness set forth in Section 2
below, the Credit Agreement is hereby amended as
follows:
(a) The
definition of “Alternate Base Rate” set forth in
Section 1.1 of the Credit Agreement is hereby amended in its
entirety as follows:
“Alternate Base Rate” means, for any
date, a rate per annum equal to the highest of (i) the Prime
Rate for such day, (ii) the Federal Funds Effective Rate
plus 1/2% per annum for such day, and (iii) the
Eurodollar Rate (without giving effect to the Applicable Margin)
for a one month Interest Period on such day (or if such day is not
a Business Day, the immediately preceding Business Day) plus
1%; provided that, for the avoidance of doubt, the
Eurodollar Rate for any day shall be based on the rate appearing
on
the Reuters
Screen LIBOR01 Page 1 (or on any successor or substitute page) at
approximately 11:00 a.m. London time on such day. Any change
in the Alternate Base Rate due to a change in the Prime Rate, the
Federal Funds Effective Rate or the Eurodollar Rate shall be
effective from and including the effective date of such change in
the Prime Rate, the Federal Funds Effective Rate or the Eurodollar
Rate, respectively.
(b) The
definition of “Applicable Fee Rate” set forth in
Section 1.1 of the Credit Agreement is hereby amended in its
entirety as follows:
“Applicable Fee Rate” means, with
respect to the Commitment Fee at any time, 0.375% per
annum.
(c) Section 1.1
of the Credit Agreement is hereby amended to insert alphabetically
therein the following new defined term:
“Defaulting Lender” means any
Lender, as determined by the Agent, that has (a) failed to
fund any portion of its Loans or participations in Facility LCs,
Non-Ratable Loans or Collateral Protection Advances within three
Business Days of the date required to be funded by it hereunder,
(b) notified the Borrower, the Agent, the LC Issuer, the
Non-Ratable Lender or any Lender in writing that it does not intend
to comply with any of its funding obligations under this Agreement
or has made a public statement to the effect that it does not
intend to comply with its funding obligations under this Agreement
or under other agreements in which it commits to extend credit,
(c) failed, within three Business Days after request by the
Agent, to confirm that it will comply with the terms of this
Agreement relating to its obligations to fund prospective Loans and
participations in then outstanding Facility LCs, Collateral
Protection Advances and Non-Ratable Loans, (d) otherwise
failed to pay over to the Agent or any other Lender any other
amount required to be paid by it hereunder within three Business
Days of the date when due, unless the subject of a good faith
dispute, or (e) (i) become or is insolvent or has a parent company
that has become or is insolvent or (ii) become the subject of
a bankruptcy or insolvency proceeding, or has had a receiver,
conservator, trustee or custodian appointed for it, or has taken
any action in furtherance of, or indicating its consent to,
approval of or acquiescence in any such proceeding or appointment
or has a parent company that has become the subject of a bankruptcy
or insolvency proceeding, or has had a receiver, conservator,
trustee or custodian appointed for it, or has taken any action in
furtherance of, or indicating its consent to, approval of or
acquiescence in any such proceeding or appointment; provided
, that the mere ownership by a governmental authority of a
Lender’s or its parent
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company’s
equity interests shall not result in a Lender becoming a Defaulting
Lender under this clause (ii).
(d) Article II
of the Credit Agreement is hereby amended to insert immediately at
the end thereof the following Section 2.21:
Section 2.21. Defaulting
Lenders. Notwithstanding any provision of this Agreement to
the contrary, if any Lender becomes a Defaulting Lender, then the
following provisions shall apply for so long as such Lender is a
Defaulting Lender:
(a) if any
Facility LCs (including Reimbursement Obligations in respect
thereof), Collateral Protection Advances or Non-Ratable Loans are
outstanding at the time a Lender is a Defaulting Lender, the
Borrower shall within one Business Day following notice by the
Agent (i) prepay the Non-Ratable Loans or Collateral
Protection Advances, as applicable, or, if agreed by the
Non-Ratable Lender or the Agent, as applicable, cash collateralize
the outstanding principal amount of the Non-Ratable Loans or
Collateral Protection Advances (or ratable participations therein),
as applicable, of the Defaulting Lender on terms satisfactory to
the Non-Ratable Lender or the Agent, as applicable, and
(ii) cash collateralize such Defaulting Lender’s L/C
Obligations in accordance with the procedures set forth in
Sections 2.19.11 and 8.1 for so long as such Facility LCs
(including Reimbursement Obligations in respect thereof) remain
outstanding (with the understanding that such cash
collateralization and Liens granted in respect thereof shall be
deemed permitted under this Agreement pursuant to
Section 6.15.1); and
(b) the
Non-Ratable Lender shall not be required to fund any Non-Ratable
Loan, the Agent shall not be required to fund any Collateral
Protection Advance, and the LC Issuer shall not be required to
issue, amend, extend, renew or increase any Facility LC unless it
is satisfied that cash collateral will be provided by the Borrower
in accordance with Section 2.21(a) .
(e) Section 6.14.6
of the Credit Agreement is hereby amended in its entirety as
follows:
6.14.6
Indebtedness not described in or otherwise subject to
Sections 6.14.1 through 6.14.5 that is unsecured and that does
not at any time exceed an aggregate amount equal to
$600,000,000.
(f) Section 6.14.7
of the Credit Agreement is hereby amended in its entirety as
follows:
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6.14.7
Indebtedness in an aggregate amount not to exceed $600,000,000 at
any time arising under or in connection with Letters of Credit
(other than Facility LCs) issued for the account of the Borrower or
any Subsidiary thereof; provided , that such Letters of
Credit shall either be used in connection with the Borrower’s
or such Subsidiary’s acquisition of Petroleum Inventory
outside of the United States of America or for general corporate
purposes in the ordinary course of business.
(g) Section 9.8
of the Credit Agreement is hereby amended in its entirety as
follows:
9.8
Accounting . Except as provided to the contrary herein, all
accounting terms used in the calculation of any financial covenant
or test shall be interpreted and all accounting determinations
hereunder in the calculation of any financial covenant or test
shall be made in accordance with Agreement Accounting Principles.
If any changes in US GAAP are hereafter required or permitted and
are adopted by the Borrower or any of its Subsidiaries with the
agreement of its independent certified public accountants and such
changes result in a change in the method of calculation of any of
the financial covenants, tests, restrictions or standards herein or
in the related definitions or terms used therein (“
Accounting Changes ”), the parties hereto agree, at
the Borrower’s request, to enter into negotiations, in good
faith, in order to amend such provisions in a credit neutral manner
so as to reflect equitably such changes with the desired result
that the criteria for evaluating the Borrower’s and its
Subsidiaries’ financial condition shall be the same after
such changes as if such changes had not been made; provided
, however , until such provisions are amended in a manner
reasonably satisfactory to the Agent and the Required Lenders, no
Accounting Change shall be given effect in such calculations. In
the event such amendment is entered into, all references in this
Agreement to Agreement Accounting Principles shall mean US GAAP as
of the date of such amendment. Notwithstanding the foregoing or
anything to the contrary set forth herein, (x) all financial
statements to be delivered by the Borrower pursuant to
Section 6.1 shall be prepared in accordance with US GAAP in
effect at such time and (y) all terms of an accounting or
financial nature used herein or in any other Loan Document shall be
construed, and all computations of amounts and ratios referred to
herein or in any other Loan Document shall be made, without giving
effect to any election under Statement of Financial Accounting
Standards 159 (or any other Financial Accounting Standard having a
similar result or effect) to value any Indebtedness or other
liabilities of the Borrower or any Subsidiary at “fair
value”, as defined therein.
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(h) The
Pricing Schedule to the Credit Agreement is hereby amended in its
entirety pursuant to the Pricing Schedule attached hereto as
Exhibit A .
2.
Conditions of Effectiveness . This Amendment shall become
effective and be deemed effective as of the date hereof, if, and
only if:
(a) the
Agent shall have received executed copies of this Amendment from
the Borrower and the Required Lenders;
(b) the
Agent shall have received a written reaffirmation of the
Borrower’s and the Subsidiary Guarantors’ respective
obligations under the Guaranty and the Collateral Documents in form
and substance substantially similar to Exhibit B
hereto;
(c) the
Agent shall have received, for the account of each Lender which
delivers its executed signature page hereto by such time as is
required by the Agent, an amendment fee equal to 0.125% of such
Lender’s Revolving Loan Commitment under the Credit
Agreement; and
(d) the
Borrower shall have paid all fees and expenses of the Agent
(including, to the extent invoiced, attorneys’ fees and
expenses) in connection with this Amendment.
3.
Representations and Warranties of the Borrower . The
Borrower hereby represents and warrants as follows:
(a) The
Credit Agreement as previously executed and amended and as amended
hereby constitutes the legal, valid and binding obligation of the
Borrower and is enforceable against the Borrower in accordance with
its terms, except as enforceability may be limited by
(i) bankruptcy, insolvency, fraudulent conveyances,
reorganization or similar laws relating to or affecting the
enforcement of creditors’ rights generally; (ii) general
equitable principles (whether considered in a proceeding in equity
or at law); and (iii) requirements of reasonableness, good
faith and fair dealing.
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