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Exhibit 10.1
EXECUTION COPY
$547,250,000
CREDIT AGREEMENT
among
KEY ENERGY SERVICES, INC.,
as Borrower,
The Several Lenders
LEHMAN BROTHERS INC.,
as Sole Lead Arranger and Sole Bookrunner
LEHMAN COMMERCIAL PAPER INC.,
WELLS FARGO FOOTHILL, INC., as Revolving Administrative Agent,
and
LEHMAN COMMERCIAL PAPER INC.,
Dated as of July 29, 2005
TABLE OF CONTENTS
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CREDIT AGREEMENT, dated as of July 29, 2005 , among KEY ENERGY SERVICES, INC., a Maryland corporation (the “ Borrower ”), the several banks and other financial institutions or entities from time to time parties to this Agreement (the “ Lenders ”), LEHMAN BROTHERS INC., as advisor, sole lead arranger and sole bookrunner (in such capacity, the “ Arranger ”), LEHMAN COMMERCIAL PAPER INC., as syndication agent (in such capacity, the “ Syndication Agent ”), WELLS FARGO FOOTHILL, INC., as administrative agent under the Revolving Credit Facility and the Funded Letter of Credit Facility (in such capacity, the “ Revolving Administrative Agent ”), and LEHMAN COMMERCIAL PAPER INC., as administrative agent (in such capacity, the “ Administrative Agent ”), and as collateral agent (in such capacity, the “ Collateral Agent ”).
W I T N E S S E T H :
WHEREAS, the Borrower wishes to refinance its Existing Credit Facility and to have funds available to refinance the Existing Notes (collectively, the “ Refinancing ”);
WHEREAS, the Borrower has requested that the Lenders make credit facilities available to the Borrower in order to finance the Refinancing and for the other purposes set forth herein; and
WHEREAS, the Lenders are willing to make such credit facilities available upon and subject to the terms and conditions hereinafter set forth;
NOW, THEREFORE, in consideration of the premises and the agreements hereinafter set forth, the parties hereto hereby agree as follows:
1.1 Defined Terms . As used in this Agreement, the terms listed in this Section 1.1 shall have the respective meanings set forth in this Section 1.1.
“ Acquired Person ”: any Person (a) acquired by the Borrower or its Subsidiaries which upon such acquisition becomes a Subsidiary or is merged or combined into the Borrower or a Subsidiary or (b) all or substantially all of the assets of which (or all or substantially all of the assets of any business or division of which) are acquired by the Borrower or a Subsidiary.
“ Acquired Person Unreleased Liens ”: financing statements, the notation of Liens on certificates of title and other notices of Liens given or filed with respect to Acquired Persons which relate solely to Indebtedness and other obligations which have been fully repaid.
“ Administrative Agent ”: as defined in the preamble hereto.
“ Affiliate ”: as to any Person, any other Person that, directly or indirectly, is in control of, is controlled by, or is under common control with, such Person. For purposes of this definition, “control” of a Person means the power, directly or indirectly, either to (a) vote 10% or more of the securities having ordinary voting power for the election of directors (or persons performing similar functions) of such Person or (b) direct or cause the direction of the management and policies of such Person, whether by contract or otherwise.
“ Agents ”: the collective reference to the Syndication Agent, the Revolving Administrative Agent, the Administrative Agent and the Collateral Agent.
“ Aggregate Exposure ”: with respect to any Lender at any time, an amount equal to (a) until the Closing Date, the aggregate amount of such Lender’s Commitments at such time and (b) thereafter, the sum of (i) the aggregate amount of such Lender’s then unfunded Tranche B Term Loan Commitment plus the aggregate then unpaid principal amount of such Lender’s Term Loans, (ii) the amount of such Lender’s Revolving Credit Commitment then in effect or, if the Revolving Credit Commitments have been terminated, the amount of such Lender’s Revolving Extensions of Credit then outstanding and (iii) the amount of such Lender’s Funded Letter of Credit Commitment then in effect or, if the Funded Letter of Credit Commitments have been terminated, the amount of such Lender’s Funded Letter of Credit Exposure.
“ Aggregate Exposure Percentage ”: with respect to any Lender at any time, the ratio (expressed as a percentage) of such Lender’s Aggregate Exposure at such time to the sum of the Aggregate Exposures of all Lenders at such time.
“ Agreement ”: this Credit Agreement, as amended, supplemented, replaced or otherwise modified from time to time.
“ Applicable Margin ”: for each Type of Loan under each Facility, the rate per annum set forth opposite such Facility under the relevant column heading below:
provided , that (a) each Applicable Margin set forth above shall increase permanently by 0.50% on each of December 31, 2005 and June 30, 2006, in each case if by such date the Borrower has not provided to the Arranger audited and unaudited financial statements (which unaudited financial statements have been reviewed by the independent accountants for the Borrower and its subsidiaries as provided in Statement on Auditing Standards No. 100) of the Borrower and its subsidiaries (including pro forma financial statements) meeting the requirements of Regulation S-X for a Form S-1 registration statement under the Securities Act of 1933, as amended and (b) on and after the first date on which the Facilities are rated by both S&P and Moody’s, the Applicable Margins will be determined pursuant to the Pricing Grid.
“ Applicable States ”: with respect to any Loan Party, the states in which such Loan Party does a material amount of business or has material operations, as determined on the Closing Date by the Borrower, in consultation with the Administrative Agent.
“ Application ”: an application, in such form as the relevant Issuing Lender may specify from time to time, requesting such Issuing Lender to issue a Letter of Credit.
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“ Arranger ”: as defined in the preamble hereto.
“ Asset Sale ”: any Disposition of Property or series of related Dispositions of Property (excluding any such Disposition permitted by any of clauses (a)-(f) or (i)-(l) of Section 7.5) which yields gross proceeds to the Borrower or any of its Subsidiaries (valued at the initial principal amount thereof (net of any original issue discount) in the case of non-cash proceeds consisting of notes or other debt securities and valued at Fair Market Value in the case of other non-cash proceeds) in excess of $2,000,000.
“ Assignee ”: as defined in Section 10.6(c).
“ Assignment and Acceptance ”: as defined in Section 10.6(c).
“ Assignor ”: as defined in Section 10.6(c).
“ Available Revolving Credit Commitment ”: with respect to any Revolving Credit Lender at any time, an amount equal to the excess, if any, of (a) such Lender’s Revolving Credit Commitment then in effect over (b) such Lender’s Revolving Extensions of Credit then outstanding; provided , that in calculating any Lender’s Revolving Extensions of Credit for the purpose of determining such Lender’s Available Revolving Credit Commitment pursuant to Section 2.9(a), but not for any other purpose (including Section 2.7), the aggregate principal amount of Swing Line Loans then outstanding shall be deemed to be zero.
“ Base Rate ”: for any day, a rate per annum (rounded upwards, if necessary, to the next 1/100 of 1%) equal to the greater of (a) the Prime Rate in effect on such day and (b) the Federal Funds Effective Rate in effect on such day plus ½ of 1%. For purposes hereof: “ Prime Rate ” shall mean the prime lending rate as set forth on the British Banking Association Telerate Page 5 (or such other comparable page as may, in the opinion of the Administrative Agent, replace such page for the purpose of displaying such rate), as in effect from time to time. The Prime Rate is a reference rate and does not necessarily represent the lowest or best rate actually available. Any change in the Base Rate due to a change in the Prime Rate or the Federal Funds Effective Rate shall be effective as of the opening of business on the effective day of such change in the Prime Rate or the Federal Funds Effective Rate, respectively.
“ Base Rate Loans ”: Loans for which the applicable rate of interest is based upon the Base Rate.
“ Benefitted Lender ”: as defined in Section 10.7(a).
“ Board ”: the Board of Governors of the Federal Reserve System of the United States (or any successor).
“ Borrower ”: as defined in the preamble hereto.
“ Borrowing Date ”: any Business Day specified by the Borrower in a Borrowing Notice as a date on which the relevant Lenders are requested to make Loans hereunder.
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“ Borrowing Notice ”: with respect to any request for borrowing of Loans hereunder, a notice from the Borrower, substantially in the form of, and containing the information prescribed by, Exhibit J, delivered to the Administrative Agent and the Revolving Administrative Agent, as applicable.
“ Business Day ”: (a) for all purposes other than as covered by clause (b) below, a day other than a Saturday, Sunday or other day on which commercial banks in New York City are authorized or required by law to close and (b) with respect to all notices and determinations in connection with, and payments of principal and interest on, Eurodollar Loans or the Credit Linked Deposit, any day which is a Business Day described in clause (a) and which is also a day for trading by and between banks in Dollar deposits in the interbank eurodollar market.
“ Capital Expenditures ”: for any period, with respect to any Person, the aggregate of all expenditures by such Person for the acquisition or leasing (pursuant to a capital lease) of fixed or capital assets or additions to equipment (including replacements, capitalized repairs and improvements during such period) which are required to be capitalized under GAAP on a balance sheet of such Person; provided that “Capital Expenditures” shall not include (a) expenditures for Permitted Acquisitions or (b) expenditures by any Acquired Person prior to the time such Acquired Person was acquired in a Permitted Acquisition.
“ Capital Lease Obligations ”: with respect to any Person, 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, for the purposes of this Agreement, the amount of such obligations at any time shall be the capitalized amount thereof at such time determined in accordance with GAAP.
“ Capital Stock ”: any and all shares, interests, participations or other equivalents (however designated) of capital stock of a corporation, any and all equivalent ownership interests in a Person (other than a corporation) and any and all warrants, rights or options to purchase any of the foregoing.
“ Cash Equivalents ”: (a) marketable direct obligations issued by, or unconditionally guaranteed by, the United States government or issued by any agency thereof and backed by the full faith and credit of the United States, in each case maturing within one year from the date of acquisition; (b) certificates of deposit, time deposits, eurodollar time deposits or overnight bank deposits having maturities of six months or less from the date of acquisition issued by any Lender or by any commercial bank organized under the laws of the United States or any state thereof (including any foreign bank which is a Subsidiary of a commercial bank or holding company thereof which is organized under any such laws) having combined capital and surplus of not less than $500,000,000; (c) commercial paper of an issuer rated at least A-2 by S&P or P-2 by Moody’s or carrying an equivalent rating by a nationally recognized rating agency, if both of the two named rating agencies cease publishing ratings of commercial paper issuers generally, and maturing within six months from the date of acquisition; (d) repurchase obligations of any Lender or of any commercial bank satisfying the requirements of clause (b) of this definition, having a term of not more than 30 days with respect to securities issued or fully guaranteed or insured by the United States government; (e) securities with
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maturities of one year or less from the date of acquisition issued or fully guaranteed by any state, commonwealth or territory of the United States, by any political subdivision or taxing authority of any such state, commonwealth or territory or by any foreign government, the securities of which state, commonwealth, territory, political subdivision, taxing authority or foreign government (as the case may be) are rated at least A by S&P or A by Moody’s; (f) securities with maturities of six months or less from the date of acquisition backed by standby letters of credit issued by any Lender or any commercial bank satisfying the requirements of clause (b) of this definition; and (g) shares of money market mutual or similar funds which invest primarily in assets satisfying the requirements of clauses (a) through (f) of this definition.
“ Change of Control ”: the occurrence of any of the following events: (a) any “person” or “group” (as such terms are used in Sections 13(d) and 14(d) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”)), shall become, or obtain rights (whether by means or warrants, options or otherwise) to become, the “beneficial owner” (as defined in Rules 13(d)-3 and 13(d)-5 under the Exchange Act), directly or indirectly, of more than 35% of the outstanding common stock of the Borrower; (b) the board of directors of the Borrower shall cease to consist of a majority of Continuing Directors; or (c) a Specified Change of Control.
“ Closing Date ”: the date on which the conditions precedent set forth in Section 5.1 shall have been satisfied or waived, which date shall be not later than December 31, 2005.
“ Code ”: the Internal Revenue Code of 1986, as amended from time to time.
“ Collateral ”: all Property of the Loan Parties, now owned or hereafter acquired, upon which a Lien is purported to be created by any Security Document.
“ Collateral Agent ”: as defined in the preamble hereto.
“ Commitment ”: with respect to any Lender, the sum of the Tranche B Term Loan Commitment, the Revolving Credit Commitment and the Funded Letter of Credit Commitment of such Lender.
“ Commitment Fee Rate ”: with respect to the Revolving Credit Commitments, 0.50% per annum and, with respect to the Tranche B Term Loan Commitments, 1.00% per annum.
“ Commonly Controlled Entity ”: an entity, whether or not incorporated, that is under common control with the Borrower within the meaning of Section 4001 of ERISA or is part of a group that includes the Borrower and that is treated as a single employer under Section 414 of the Code.
“ Compliance Certificate ”: a certificate duly executed by a Responsible Officer, substantially in the form of Exhibit B.
“ Confidential Information Memorandum ”: the Confidential Information Memorandum dated July 2005 and furnished to the initial Lenders in connection with the syndication of the Facilities.
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“ Consolidated Current Assets ”: of any Person at any date, all amounts (other than cash and Cash Equivalents) that would, in conformity with GAAP, be set forth opposite the caption “total current assets” (or any like caption) on a consolidated balance sheet of such Person and its Subsidiaries at such date.
“ Consolidated Current Liabilities ”: of any Person at any date, all amounts that would, in conformity with GAAP, be set forth opposite the caption “total current liabilities” (or any like caption) on a consolidated balance sheet of such Person and its Subsidiaries at such date, but in any event excluding (a) the current portion of Funded Debt and (b) all Indebtedness consisting of Revolving Credit Loans and Swing Line Loans.
“ Consolidated EBITDA ”: of any Person for any period, Consolidated Net Income of such Person and its Subsidiaries for such period plus , without duplication and to the extent reflected as a charge in the statement of such Consolidated Net Income for such period, the sum of (a) income tax expense, (b) Consolidated Interest Expense of such Person and its Subsidiaries, amortization or write-off of debt discount and debt issuance costs and commissions, discounts and other fees and charges associated with Indebtedness, (c) depreciation and amortization expense, (d) amortization of intangibles (including, but not limited to, goodwill) and organization costs, (e) any extraordinary, unusual or non-recurring expenses or losses (including, whether or not otherwise includable as a separate item in the statement of such Consolidated Net Income for such period, losses on sales of assets outside of the ordinary course of business and any premium, make-whole or other similar amount payable in connection with the purchase or call of, or tender for, the Existing Notes), (f) any other non-cash charges and (g) for the fiscal quarters ending March 31, 2005 and June 30, 2005, amounts for accounting, legal and other expenses related to the Restatements, not to exceed $6,000,000 and $6,000,000, respectively and, for any fiscal quarter thereafter, an amount not to exceed $5,000,000 for similar expenses related to the Restatement, and minus (i) cash payments made during such period with respect to non-cash charges that were added back pursuant to clause (f) above in a prior period and (ii) to the extent included in the statement of such Consolidated Net Income for such period, the sum of (x) interest income (except to the extent deducted in determining Consolidated Interest Expense), (y) any extraordinary, unusual or non-recurring income or gains (including, whether or not otherwise includable as a separate item in the statement of such Consolidated Net Income for such period, gains on the sales of assets outside of the ordinary course of business) and (z) any other non-cash income, all as determined on a consolidated basis.
“ Consolidated Interest Coverage Ratio ”: for any period, the ratio of (a) Consolidated EBITDA of the Borrower and its Subsidiaries for such period to (b) Consolidated Interest Expense of the Borrower and its Subsidiaries for such period.
“ Consolidated Interest Expense ”: of any Person for any period, total cash interest expense (including that attributable to Capital Lease Obligations) of such Person and its Subsidiaries for such period with respect to all outstanding Indebtedness of such Person and its Subsidiaries (including, without limitation, all commissions, discounts and other fees and charges owed by such Person with respect to letters of credit and bankers’ acceptance financing and net costs of such Person under Hedge Agreements in respect of interest rates to the extent such net costs are allocable to such period in accordance with GAAP).
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“ Consolidated Leverage Ratio ”: as at the last day of any period of four consecutive fiscal quarters of the Borrower, the ratio of (a) Consolidated Total Debt on such day to (b) Consolidated EBITDA of the Borrower and its Subsidiaries for such period; provided that for purposes of calculating Consolidated EBITDA of the Borrower and its Subsidiaries for any period, (i) the Consolidated EBITDA of any Acquired Person (or of any business or division of any Acquired Person which is acquired by the Borrower or its Subsidiaries) shall be included for the period in which such Acquired Person (or such business or division) was acquired on a pro forma basis for such period (as if the consummation of such acquisition and the incurrence or assumption of any Indebtedness in connection therewith occurred on the first day of such period) if the consolidated balance sheet of such Acquired Person as at the end of the period preceding the acquisition thereof and the related consolidated statements of income and stockholders’ equity and of cash flows for the period in respect of which Consolidated EBITDA is to be calculated (x) have been previously provided to the Administrative Agent and (y) either (1) have been reported on without a qualification arising out of the scope of the audit by independent certified public accountants of nationally recognized standing or (2) have been found acceptable by the Administrative Agent and (ii) the Consolidated EBITDA of any Person (or assets comprising a business) Disposed of by the Borrower or its Subsidiaries during such period shall be excluded for such period (as if the consummation of such Disposition and the repayment of any Indebtedness in connection therewith had occurred on the first day of such period).
“ Consolidated Net Income ”: of any Person for any period, the consolidated net income (or loss) of such Person and its Subsidiaries for such period, determined on a consolidated basis in accordance with GAAP; provided , that in calculating Consolidated Net Income of the Borrower and its consolidated Subsidiaries for any period, there shall be excluded (a) the income (or deficit) of any Person accrued prior to the date it becomes a Subsidiary of the Borrower or is merged into or consolidated with the Borrower or any of its Subsidiaries, (b) the income (or deficit) of any Person (other than a Subsidiary of the Borrower) in which the Borrower or any of its Subsidiaries has an ownership interest, except to the extent that any such income is actually received by the Borrower or such Subsidiary in the form of dividends or similar distributions and (c) the undistributed earnings of any Subsidiary of the Borrower to the extent that the declaration or payment of dividends or similar distributions by such Subsidiary is not at the time permitted by the terms of any Contractual Obligation (other than under any Loan Document) or Requirement of Law applicable to such Subsidiary.
“ Consolidated Total Debt ”: at any date, the aggregate principal amount of all Indebtedness of the Borrower and its Subsidiaries at such date, determined on a consolidated basis in accordance with GAAP, plus the aggregate undrawn Stated Amount of all outstanding Letters of Credit.
“ Consolidated Working Capital ”: at any date, the difference of (a) Consolidated Current Assets of the Borrower on such date less (b) Consolidated Current Liabilities of the Borrower on such date.
“ Continuing Directors ”: the directors of the Borrower on the Closing Date and each other director of the Borrower, if, in each case, such other director’s nomination for election to the board of directors of the Borrower is recommended by at least a majority of the then Continuing Directors.
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“ Contractual Obligation ”: with respect 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.
“ Credit Linked Deposit ”: with respect to each Lender, the cash deposit, if any, made by such Lender on the Closing Date pursuant to Section 5.1(b) or, as to which such Lender has acquired reversionary rights therein pursuant to an Assignment and Acceptance, increased or reduced from time to time pursuant to the terms hereof.
“ Credit Linked Deposit Account ”: one or more operating or investment accounts established by the Revolving Administrative Agent as set forth in Section 3.7.
“ Delaware Assigning Entity ”: Yale E. Key, LLC, Brooks Well Servicing, LLC, WellTech Mid-Continent, LLC, Key Energy Drilling, LLC, and Q.V. Services, LLC.
“ Default ”: any of the events specified in Section 8, whether or not any requirement for the giving of notice, the lapse of time, or both, has been satisfied.
“ Derivatives Counterparty ”: as defined in Section 7.6.
“ Disposition ”: with respect to any Property, any sale, lease, sale and leaseback, assignment, conveyance, transfer or other disposition thereof; and the terms “ Dispose ” and “ Disposed of ” shall have correlative meanings.
“ Dollars ” and “ $ ”: lawful currency of the United States.
“ Domestic Subsidiary ”: any Subsidiary of the Borrower organized under the laws of any jurisdiction within the United States.
“ ECF Percentage ”: with respect to any fiscal year of the Borrower, 50.0%; provided , that, with respect to any fiscal year of the Borrower ending on or after December 31, 2006, (a) the ECF Percentage shall be 25.0% if the Consolidated Leverage Ratio as of the last day of such fiscal year is greater than 2.0 to 1.0 but not greater than 2.5 to 1.0 and (b) the ECF Percentage shall be 0.0% if the Consolidated Leverage Ratio as of the last day of such fiscal year is not greater than 2.0 to 1.0.
“ 8 3/8 % Notes ”: the 8 3/8% Senior Notes due 2008 outstanding under the 8 3/8% Notes Indenture in an aggregate principal amount of $275,000,000 as of the date hereof.
“ 8 3/8 % Notes Indenture ”: the Indenture dated as of February 27, 2002, between the Borrower and U.S. Bank National Association, as trustee, as amended and supplemented from time to time prior to the Closing Date.
“ Environmental Laws ”: any and all laws, rules, orders, regulations, statutes, ordinances, codes, decrees, or other legally enforceable requirements (including, without limitation, common law) of any international authority, foreign government, the United States, or any state, local, municipal or other governmental authority, regulating, relating to or imposing
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liability or standards of conduct concerning protection of the environment or of human health, or employee health and safety, as has been, is now, or may at any time hereafter be, in effect.
“ Environmental Permits ”: any and all permits, licenses, approvals, registrations, notifications, exemptions and other authorizations required under any Environmental Law.
“ ERISA ”: the Employee Retirement Income Security Act of 1974, as amended from time to time.
“ Eurocurrency Reserve Requirements ”: for any day, the aggregate (without duplication) of the maximum rates (expressed as a decimal fraction) of reserve requirements in effect on such day (including, without limitation, basic, supplemental, marginal and emergency reserves) under any regulations of the Board or other Governmental Authority having jurisdiction with respect thereto dealing with reserve requirements prescribed for eurocurrency funding (currently referred to as “Eurocurrency Liabilities” in Regulation D of the Board) maintained by a member bank of the Federal Reserve System.
“ Eurodollar Base Rate ”: with respect to each day during each Interest Period, the rate per annum determined on the basis of the rate for deposits in Dollars for a period equal to such Interest Period commencing on the first day of such Interest Period appearing on Page 3750 of the Telerate screen as of 11:00 A.M., London time, two Business Days prior to the beginning of such Interest Period. In the event that such rate does not appear on Page 3750 of the Telerate screen (or otherwise on such screen), the “ Eurodollar Base Rate ” for purposes of this definition shall be determined by reference to such other comparable publicly available service for displaying eurodollar rates as may be selected by the Administrative Agent.
“ Eurodollar Loans ”: Loans for which the applicable rate of interest is based upon the Eurodollar Rate.
“ Eurodollar Rate ”: with respect to each day during each Interest Period, a rate per annum determined for such day in accordance with the following formula (rounded upward to the nearest 1/100th of 1%):
“ Eurodollar Tranche ”: the collective reference to Eurodollar Loans the then current Interest Periods with respect to all of which begin on the same date and end on the same later date (whether or not such Loans shall originally have been made on the same day).
“ Event of Default ”: any of the events specified in Section 8, provided that any requirement for the giving of notice, the lapse of time, or both, has been satisfied.
“ Excess Cash Flow ”: for any fiscal year of the Borrower, Consolidated EBITDA of the Borrower and its Subsidiaries for such fiscal year less (a) the sum of (i) Consolidated Interest Expense of the Borrower and its Subsidiaries for such fiscal year, to the extent paid or currently payable in cash, (ii) cash taxes paid or payable with respect to such fiscal year, (iii) the aggregate amount actually paid by the Borrower and its Subsidiaries in cash during such fiscal
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year on account of Capital Expenditures (minus the principal amount of Indebtedness incurred in connection with such expenditures and minus the amount of any such expenditures financed with the proceeds of any Reinvestment Deferred Amount), (iv) the aggregate amount of all regularly scheduled principal payments of Funded Debt of the Borrower and its Subsidiaries made during such Fiscal Year (other than in respect of any revolving credit facility to the extent there is not an equivalent permanent reduction of commitments thereunder), and (v) the aggregate amount of all optional prepayments of Term Loans during such Fiscal Year, and plus (b) decreases (and minus increases) in Consolidated Working Capital for such fiscal year.
“ Excess Cash Flow Application Date ”: as defined in Section 2.12(c).
“ Excluded Equity Issuances ”: the issuance and sale of Capital Stock of the Borrower (a) upon the exercise of any options issued to employees in the ordinary course of business pursuant to employee stock plans or (b) the proceeds of which will be used within 90 days thereafter to pay consideration for a Permitted Acquisition (provided that any such proceeds not so used within 90 days of issuance shall be subject to the provisions of Section 2.12(a)).
“ Existing Credit Facility ”: the Fourth Amended and Restated Credit Agreement, dated as of June 7, 1997, as amended and restated through November 10, 2003, as amended from time to time through the Closing Date, among the Borrower, each of the subsidiaries of the Borrower party thereto, PNC Bank, National Association, as administrative agent, PNC Capital Markets, Inc. and Wells Fargo Bank Texas, National Association, as co-lead arrangers, Credit Lyonnais New York Branch as Syndication Agent and Bank One, NA and Comerica Bank as co-documentation agents.
“ Existing Indentures ”: the 6 3/8% Notes Indenture and the 8 3/8% Notes Indenture.
“ Existing Notes ”: the 6 3/8% Notes and the 8 3/8% Notes.
“ Facility ”: each of (a) the Tranche B Term Loan Commitments and the Tranche B Term Loans made thereunder (the “ Tranche B Term Loan Facility ”), (b) the Revolving Credit Commitments and the extensions of credit made thereunder (the “ Revolving Credit Facility ”) and (c) the Funded Letter of Credit Commitments and the extensions of credit made thereunder (the “ Funded Letter of Credit Facility ”).
“ Fair Market Value ”: with respect to any Asset Sale, any exchange or “swap” subject to the provisions of Section 7.5(f) or any Disposition of assets subject to the provisions of Section 7.5(h), fair market value as determined in good faith (a) by a Responsible Officer if such fair market value is equal to or less than $10,000,000 and (b) by the board of directors of Borrower if such fair market value is greater than $10,000,000.
“ Federal Funds Effective Rate ”: for any day, the weighted average of the rates on overnight federal funds transactions with members of the Federal Reserve System arranged by federal funds brokers, as published on the next succeeding Business Day by the Federal Reserve Bank of New York, or, if such rate is not so published for any day which is a Business Day, the average of the quotations for the day of such transactions received by the Administrative Agent from three federal funds brokers of recognized standing selected by it.
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“ Financial Reporting Compliance Date ”: the day that the Borrower has delivered to the Administrative Agent, the Revolving Administrative Agent and the Lenders (a) all financial statements then required to be delivered pursuant to, and meeting the requirements of, Section 6.1 and (b) all Prior Financial Statements.
“ Foreign Subsidiary ”: any Subsidiary of the Borrower that is not a Domestic Subsidiary.
“ FQ1 ”, “ FQ2 “, “ FQ3 ”, and “ FQ4 ”: when used with a numerical year designation, means the first, second, third or fourth fiscal quarters, respectively, of the designated fiscal year of the Borrower (e.g., FQ1 2004 means the first fiscal quarter of the Borrower’s 2004 fiscal year, which ended March 31, 2004).
“ Funded Debt ”: with respect to any Person, all Indebtedness of such Person of the types described in clauses (a) through (e) of the definition of “Indebtedness” in this Section.
“ Funded L/C Obligations ”: at any time, an amount equal to the sum of (a) the aggregate Stated Amount of the then outstanding Funded Letters of Credit and (b) the aggregate amount of drawings under Funded Letters of Credit that have not then been reimbursed by the Borrower pursuant to Section 3.6.
“ Funded L/C Participant ” : each Lender that has a Funded Letter of Credit Commitment or that has a reversionary interest in the Credit Linked Deposit.
“ Funded Letter of Credit ”: as defined in Section 3.1(b).
“ Funded Letter of Credit Commitment ”: as to any Lender, the obligation of such Lender, if any, to make or otherwise fund a Credit Linked Deposit, in an aggregate principal amount not to exceed the amount set forth under the heading “Funded Letter of Credit Commitment” opposite such Lender’s name on Schedule 1 to the Lender Addendum delivered by such Lender or in the applicable Assignment and Acceptance pursuant to which such Lender became a party hereto, as the same may be changed from time to time pursuant to the terms hereof. The aggregate amount of the Funded Letter of Credit Commitments as of the Closing Date is $82,250,000.
“ Funded Letter of Credit Commitment Period ”: the period from and including the Closing Date to the Funded Letter of Credit Termination Date.
“ Funded Letter of Credit Exposure ”: with respect to any Lender, such Lender’s Funded Letter of Credit Percentage of the Funded L/C Obligations at such time.
“ Funded Letter of Credit Facility ”: as defined in the definition of “Facility” in this Section 1.1.
“ Funded Letter of Credit Fee ” : as defined in Section 3.3(b).
“ Funded Letter of Credit Participation ”: as defined in Section 3.5.
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“ Funded Letter of Credit Percentage ”: as to any Funded L/C Participant at any time, the percentage which its Funded Letter of Credit Commitment then constitutes of the Total Funded Letter of Credit Commitments (or, at any time after the Funded Letter of Credit Commitments shall have expired or terminated, the percentage which the aggregate amount of such Lender’s Funded Letter of Credit Exposure then outstanding constitutes of the Total Funded Letter of Credit Exposure then outstanding).
“ Funded Letter of Credit Termination Date ”: the five-year anniversary of the Closing Date or, if earlier, the date on which the Funded Letter of Credit Commitments are terminated in full pursuant to Sections 2.10 or 8.
“ Funding Date ”: with respect to any Tranche B Term Loan, the date specified by the Borrower in the Borrowing Notice with respect to such Tranche B Term Loan as the date such Tranche B Term Loan is to be made.
“ Funding Office ”: the office specified from time to time by the Administrative Agent or the Revolving Administrative Agent, as applicable, as its funding office by notice to the Borrower and the Lenders.
“ GAAP ”: generally accepted accounting principles in the United States as in effect from time to time.
“ Governmental Authority ”: any nation or government, any state or other political subdivision thereof and any entity exercising executive, legislative, judicial, regulatory or administrative functions of or pertaining to government.
“ Guarantee and Collateral Agreement ”: the Guarantee and Collateral Agreement to be executed and delivered by the Borrower and each Guarantor, substantially in the form of Exhibit A, as the same may be amended, supplemented, replaced or otherwise modified from time to time.
“ Guarantee Obligation ”: with respect to any Person (the “ guaranteeing person ”), any obligation of (a) the guaranteeing person or (b) another Person (including any bank under any letter of credit), if to induce the creation of which the guaranteeing person has issued a reimbursement, counterindemnity or similar obligation, in either case guaranteeing or in effect guaranteeing any Indebtedness, leases, dividends or other obligations (the “ primary obligations ”) of any other third Person (the “ primary obligor ”) in any manner, whether directly or indirectly, including, without limitation, any obligation of the guaranteeing person, whether or not contingent, (i) to purchase any such primary obligation or any Property constituting direct or indirect security therefor, (ii) to advance or supply funds (1) for the purchase or payment of any such primary obligation or (2) to maintain working capital or equity capital of the primary obligor or otherwise to maintain the net worth or solvency of the primary obligor, (iii) to purchase Property, securities or services primarily for the purpose of assuring the owner of any such primary obligation of the ability of the primary obligor to make payment of such primary obligation or (iv) otherwise to assure or hold harmless the owner of any such primary obligation against loss in respect thereof; provided , however , that the term Guarantee Obligation shall not include endorsements of instruments for deposit or collection in the ordinary course of business.
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The amount of any Guarantee Obligation of any guaranteeing person shall be deemed to be the lower of (a) an amount equal to the stated or determinable amount of the primary obligation in respect of which such Guarantee Obligation is made and (b) the maximum amount for which such guaranteeing person may be liable pursuant to the terms of the instrument embodying such Guarantee Obligation, unless such primary obligation and the maximum amount for which such guaranteeing person may be liable are not stated or determinable, in which case the amount of such Guarantee Obligation shall be such guaranteeing person’s maximum reasonably anticipated liability in respect thereof as determined by the Borrower in good faith.
“ Guarantor ”: each Subsidiary of the Borrower other than a Foreign Subsidiary or an Immaterial Subsidiary.
“ Hedge Agreements ”: all interest rate or currency swaps, caps or collar agreements, foreign exchange agreements, commodity contracts or similar arrangements entered into by the Borrower or its Subsidiaries providing for protection against fluctuations in interest rates, currency exchange rates, commodity prices or the exchange of nominal interest obligations, either generally or under specific contingencies.
“ Immaterial Subsidiary ”: (a) any Qualified Domestic Captive Insurance Subsidiary and (b) any other Subsidiary of the Borrower designated as an “Immaterial Subsidiary” which has assets with a book value of $1,000,000 or less and annual revenues of $1,000,000 or less; provided that all entities so designated as Immaterial Subsidiaries (excluding all Qualified Domestic Captive Insurance Subsidiaries) may not have at any time, in the aggregate, assets with a book value exceeding $5,000,000 or annual revenues exceeding $5,000,000. All of the Immaterial Subsidiaries as of the Closing Date are listed on Schedule 4.15 and designated thereon as “Immaterial Subsidiaries”.
“ Indebtedness ”: of any Person at any date, without duplication, (a) all indebtedness of such Person for borrowed money, (b) all obligations of such Person for the deferred purchase price of Property or services (other than trade payables incurred in the ordinary course of such Person’s business), (c) all obligations of such Person evidenced by notes, bonds, debentures or other similar instruments, (d) all indebtedness created or arising under any conditional sale or other title retention agreement with respect to Property acquired by such Person (even though the rights and remedies of the seller or lender under such agreement in the event of default are limited to repossession or sale of such Property), (e) all Capital Lease Obligations or Synthetic Lease Obligations of such Person, (f) all obligations of such Person, contingent or otherwise, as an account party or applicant under acceptance, letter of credit or similar facilities, (g) all obligations of such Person, contingent or otherwise, to purchase, redeem, retire or otherwise acquire for value any Capital Stock of such Person, (h) all Guarantee Obligations of such Person in respect of obligations of the kind referred to in clauses (a) through (g) above, (i) all obligations of the kind referred to in clauses (a) through (h) above secured by (or for which the holder of such obligation has an existing right, contingent or otherwise, to be secured by) any Lien on Property owned by such Person, whether or not such Person has assumed or become liable for the payment of such obligation, and (j) for the purposes of Section 8(e) only, all obligations of such Person in respect of Hedge Agreements.
“ Indemnified Liabilities ”: as defined in Section 10.5.
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“ Indemnitee ”: as defined in Section 10.5.
“ Insolvency ”: with respect to any Multiemployer Plan, the condition that such Plan is insolvent within the meaning of Section 4245 of ERISA.
“ Insolvent ”: pertaining to a condition of Insolvency.
“ Intellectual Property ”: the collective reference to all rights, priorities and privileges relating to intellectual property, whether arising under United States, state, multinational or foreign laws or otherwise, including, without limitation, copyrights, copyright licenses, patents, patent licenses, trademarks, trademark licenses, service-marks, technology, know-how and processes, recipes, formulas, trade secrets, and all rights to sue at law or in equity for any infringement or other impairment thereof, including the right to receive all proceeds and damages therefrom.
“ Interest Payment Date ”: (a) as to any Base Rate Loan, the last day of each March, June, September and December to occur while such Loan is outstanding and the final maturity date of such Loan, (b) as to any Eurodollar Loan having an Interest Period of three months or less, the last day of such Interest Period, (c) as to any Eurodollar Loan having an Interest Period longer than three months, each day that is three months after the first day of such Interest Period and the last day of such Interest Period and (d) as to any Loan (other than any Revolving Credit Loan that is a Base Rate Loan (unless all Revolving Credit Loans are being repaid in full and the Revolving Credit Commitments terminated) and any Swing Line Loan), the date of any repayment or prepayment made in respect thereof.
“ Interest Period ”: (a) as to any Eurodollar Loan, (i) initially, the period commencing on the borrowing or conversion date, as the case may be, with respect to such Eurodollar Loan and ending one, two, three or six months thereafter, as selected by the Borrower in its Borrowing Notice or notice of conversion, as the case may be, given with respect thereto; provided that, prior to the Syndication Date, the Interest Period shall be one month; and (ii) thereafter, each period commencing on the last day of the immediately preceding Interest Period applicable to such Eurodollar Loan and ending one, two, three or six months thereafter, as selected by the Borrower by irrevocable notice to the Administrative Agent and the Revolving Administrative Agent not less than three Business Days prior to the last day of the then current Interest Period with respect thereto; and (b) in connection with a Credit Linked Deposit, (i) initially, the period commencing on the Closing Date and ending three months thereafter and (ii) thereafter, each period commencing on the last day of the next preceding Interest Period applicable to the Credit Linked Deposit and ending three months thereafter; provided that, all of the foregoing provisions relating to Interest Periods are subject to the following:
(x) if any Interest Period would otherwise end on a day that is not a Business Day, such Interest Period shall be extended to the next succeeding Business Day unless the result of such extension would be to carry such Interest Period into another calendar month in which event such Interest Period shall end on the immediately preceding Business Day;
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(y) any Interest Period with respect to any Revolving Credit Loans, Funded Letter of Credit or Tranche B Term Loan, respectively, that would otherwise extend beyond the Revolving Credit Termination Date, the Funded Letter of Credit Termination Date, or beyond the date final payment is due on the Tranche B Term Loans, as the case may be, shall end on the Revolving Credit Termination Date, the Funded Letter of Credit Termination Date or such due date, as applicable; and(z) 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.“ Investments ”: as defined in Section 7.8.“ Issuing Lender ”: any financial institution designated by the L/C Arranger as an Issuing Lender hereunder and any Revolving Credit Lender from time to time designated by the Borrower as an Issuing Lender with respect to Letters of Credit under the Revolving Credit Facility with the consent of such Revolving Credit Lender, the L/C Arranger and the Revolving Administrative Agent.
“ L/C Arranger ”: Wells Fargo, in its capacity as the party responsible for causing the issuance of Letters of Credit hereunder.
“ L/C Fee Payment Date ”: the last day of each March, June, September and December, the last day of the Funded Letter of Credit Commitment Period with respect to Funded Letters of Credit and the last day of the Revolving Credit Commitment Period with respect to Revolving Credit Letters of Credit.
“ Lender Addendum ”: with respect to any initial Lender, a Lender Addendum, substantially in the form of Exhibit L, or otherwise acceptable to the Administrative Agent, executed and delivered by such Lender as provided in Section 10.17.
“ Lenders ”: as defined in the preamble hereto and specifically includes each Issuing Lender, the L/C Arranger, and the Swing Line Lender.
“ Letters of Credit ”: the Funded Letters of Credit and the Revolving Credit Letters of Credit.
“ Lien ”: any mortgage, pledge, hypothecation, encumbrance, lien (statutory or other), charge or other security interest or other security agreement or preferential arrangement of any kind or nature whatsoever and any assignment or deposit arrangement intended as, or having the effect of, security (including, without limitation, any conditional sale or other title retention agreement and any capital lease having substantially the same economic effect as any of the foregoing).
“ Liquidity ”: at any time, the sum of the Loan Parties’ cash and Cash Equivalents, plus the amount by which the Total Revolving Credit Commitments exceed the Total Revolving Extensions of Credit.
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“ Loan ”: any loan made by any Lender pursuant to this Agreement.
“ Loan Documents ”: this Agreement, the Security Documents, the Applications and the Notes.
“ Loan Parties ”: the Borrower and each Subsidiary of the Borrower that is a party to a Loan Document.
“ Majority Facility Lenders ”: with respect to any Facility, the holders of more than 50% of the aggregate outstanding Commitments for and extensions of credit under such Facility.
“ Majority Revolving Credit Facility Lenders ”: the Majority Facility Lenders in respect of the Revolving Credit Facility.
“ Material Adverse Effect ”: a material adverse effect on (a) the financial condition, results of operations, assets, liabilities or value of the Borrower and its Subsidiaries taken as a whole or (b) the validity or enforceability of this Agreement or any of the other Loan Documents or the rights or remedies of the Agents or the Lenders hereunder or thereunder; provided, however, that none of (a) until the Tranche B Term Loan Commitment Expiration Date, the occurrence and continuation of any Specified Default or the acceleration of any Indebtedness as a result of any Specified Default, (b) at any time prior to the Report Date, the Borrower’s failure to complete the Restatement, (c) the sale of operations listed on Schedule 4.1(b)-2 and the sale of the balance of the Borrower’s Eastern division at a loss, (d) any information publicly disclosed by the Borrower prior to July 21, 2005 or (e) any event, development or circumstance which affects generally segments of the oil and gas business in which the Borrower and its Subsidiaries are engaged and does not disproportionately affect the Borrower and its Subsidiaries, shall be deemed, individually or in the aggregate, to have a “Material Adverse Effect”.
“ Materials of Environmental Concern ”: any gasoline or petroleum (including crude oil or any fraction thereof) or petroleum products, polychlorinated biphenyls, urea-formaldehyde insulation, asbestos, pollutants, contaminants, radioactivity, and any other substances or forces of any kind, whether or not any such substance or force is defined as hazardous or toxic under any Environmental Law, that is regulated pursuant to or could give rise to liability under any Environmental Law.
“ Moody’s ”: Moody’s Investor Services, Inc.
“ Mortgages ”: any and all mortgages or deeds of trust made by any Loan Party in favor of, or for the benefit of, the Collateral Agent for the benefit of the Secured Parties, in a form as may be reasonably agreed by the Collateral Agent and the Loan Parties thereto.
“ Multiemployer Plan ”: a Plan that is a multiemployer plan as defined in Section 4001(a)(3) of ERISA.
“ Net Cash Proceeds ”: (a) in connection with any Asset Sale or any Recovery Event, all proceeds thereof, to the extent exceeding $5,000,000 in any year, received in the form
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of cash and Cash Equivalents (including any such proceeds received by way of deferred payment of principal pursuant to a note or installment receivable or purchase price adjustment receivable or otherwise, but only as and when received) of such Asset Sale or Recovery Event, net of (i) reasonable and customary attorneys’ fees, accountants’ fees, investment banking fees, relocation expenses, amounts required to be applied to the repayment of Indebtedness secured by a Lien expressly permitted hereunder on any asset which is the subject of such Asset Sale or Recovery Event (other than any Lien pursuant to a Security Document) and other reasonable and customary fees and expenses actually incurred in connection therewith and net of taxes paid or reasonably estimated to be payable as a result thereof (after taking into account any available tax credits or deductions and any tax sharing arrangements) and (ii) solely in connection with any such Asset Sale, any reserve established in accordance with GAAP, provided that any such reserved amount shall be Net Cash Proceeds to the extent and at the time such reserve is no longer required in accordance with GAAP, and (b) in connection with any issuance or sale of equity securities or debt securities or instruments or the incurrence of Indebtedness, the cash proceeds received from such issuance or incurrence, net of attorneys’ fees, investment banking fees, accountants’ fees, underwriting discounts and commissions and other customary fees and expenses actually incurred in connection therewith.
“ Non-Excluded Taxes ”: as defined in Section 2.20(a).
“ Non-Recourse Indebtedness ”: Indebtedness as to which (a) no Loan Party (i) provides credit support of any kind (including any undertaking, agreement or instrument that would constitute Indebtedness) or (ii) is directly or indirectly liable as a guarantor or otherwise, (b) no default with respect thereto (including any rights that the holders thereof may have to take enforcement action against any Subsidiary which is not a Loan Party) would permit, upon notice, lapse of time or both, any holder of any other Indebtedness (other than the Indebtedness incurred hereunder) of the Borrower or any of its Subsidiaries to declare a default on such other Indebtedness or cause the payment thereof to be accelerated or payable prior to its stated maturity, and (c) the holders thereof have been notified in writing that they will not have any recourse to the stock or assets of the Loan Parties.
“ Non-U.S. Lender ”: as defined in Section 2.20(d).
“ Note ”: any promissory note evidencing any Loan.
“ Obligations ”: the unpaid principal of and interest on (including, without limitation, interest accruing after the maturity of the Loans and Reimbursement Obligations and interest accruing after the filing of any petition in bankruptcy, or the commencement of any insolvency, reorganization or like proceeding, relating to the Borrower, whether or not a claim for post-filing or post-petition interest is allowed in such proceeding) the Loans, the Reimbursement Obligations and all other obligations and liabilities of the Borrower to the Administrative Agent, the Revolving Administrative Agent, the Collateral Agent, any Issuing Lender, any Lender or any Qualified Counterparty, whether direct or indirect, absolute or contingent, due or to become due, or now existing or hereafter incurred, which may arise under, out of, or in connection with, this Agreement, any other Loan Document, the Letters of Credit, any Specified Hedge Agreement or any other document made, delivered or given in connection herewith or therewith, whether on account of principal, interest, reimbursement obligations, fees,
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indemnities, costs, expenses (including, without limitation, all fees, charges and disbursements of counsel to the Arranger, to the Agents or to any Lender that are required to be paid by the Borrower pursuant hereto) or otherwise; provided , that (a) obligations of the Borrower or any Subsidiary under any Specified Hedge Agreement shall be secured and guaranteed pursuant to the Security Documents only to the extent that, and for so long as, the other Obligations are so secured and guaranteed and (b) any release of Collateral or Guarantors effected in the manner permitted by this Agreement shall not require the consent of holders of obligations under Specified Hedge Agreements.
“ Oilfield Intellectual Property ”: (a) the services provided by the Loan Parties and/or their Subsidiaries, including, but not limited to, well servicing, work-over, and drilling services; (b) all data and/or other information generated or obtained by or on behalf of the Loan Parties and/or their Subsidiaries in connection with the provision of such services; (c) all measurement, acquisition, manipulation, and display and all devices and systems used or useful in measuring, acquiring, manipulating, displaying, and/or otherwise dealing with such data or information; and (d) all U.S. and foreign patents and trademarks, U.S. and foreign applications for patents and trademarks, trade secrets, confidential business information, U.S. and foreign copyrights, and any other intellectual property or intellectual property right associated with items described in clauses (a) through (c) above.
“ Other Taxes ”: any and all present or future stamp or documentary taxes or any other excise or property taxes, charges or similar levies arising from any payment made hereunder or from the execution, delivery or enforcement of, or otherwise with respect to, this Agreement or any other Loan Document.
“ Participant ”: as defined in Section 10.6(b).
“ Payment Office ”: the office specified from time to time by the Administrative Agent or the Revolving Administrative Agent, as applicable, as its payment office by notice to the Borrower and the Lenders.
“ PBGC ”: the Pension Benefit Guaranty Corporation established pursuant to Subtitle A of Title IV of ERISA (or any successor).
“ Permits ”: the collective reference to (a) Environmental Permits, and (b) any and all other franchises, licenses, leases, permits, approvals, notifications, certifications, registrations, authorizations, exemptions, easements, and rights of way.
“ Permitted Acquisitions ”: as defined in Section 7.8(g).
“ Permitted Liens ”: the collective reference to (a) in the case of Collateral other than Pledged Stock, Liens permitted by Section 7.3 and (b) in the case of Collateral consisting of Pledged Stock, non-consensual Liens permitted by Section 7.3 to the extent arising by operation of law.
“ Permitted Perfection Exception ”: (a) personal property subject to a certificate of title act under which a security interest may be perfected only by notation on the certificate of title (i) without limitation as to amount until the date such perfection is required under Section 6.15
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and (ii) thereafter only if and so long as the aggregate book value of all such property as to which no such notation has been made does not at any time exceed $1,000,000, (b) to the extent deposit accounts are maintained at financial institutions other than the Revolving Administrative Agent, the Loan Parties will not be required to take action pursuant to Section 9-104 of the Uniform Commercial Code to perfect the Collateral Agent’s Liens in such deposit accounts or to grant the Collateral Agent control thereof unless an Event of Default has occurred and is continuing, (c) the Loan Parties will not be required to take any action outside of the United States to perfect the Collateral Agent’s Liens on assets of any Loan Party located outside of the United States unless the aggregate book value of such assets, together with the aggregate amounts permitted by Section 7.2(e), the proviso in Section 7.2(k) and Section 7.8(h) with respect to Foreign Subsidiaries, exceeds at any time $25,000,000 per fiscal year or $100,000,000 in the aggregate for the term hereof or an Event of Default has occurred and is continuing, (d) real property owned on the date hereof, (e) to the extent fixtures exist at real property which is not required by the Loan Documents to be subject to a Mortgage, no fixture filing will be required as to such fixtures and (f) the shares of Capital Stock of Foreign Subsidiaries required to be delivered to the Collateral Agent under the Guarantee and Collateral Agreement need not be delivered until such delivery is required under Section 6.15.
“ Permitted Subordinated Indebtedness ”: Indebtedness otherwise permitted hereunder that is subordinated in right of payment to any of the Obligations.
“ Person ”: an individual, partnership, corporation, limited liability company, business trust, joint stock company, trust, unincorporated association, joint venture, Governmental Authority or other entity of whatever nature.
“ Plan ”: at a particular time, any employee benefit plan that is covered by ERISA and in respect of which the Borrower or a Commonly Controlled Entity is (or, if such plan were terminated at such time, would under Section 4069 of ERISA be deemed to be) an “employer” as defined in Section 3(5) of ERISA.
“ Pledged Stock ”: as defined in the Guarantee and Collateral Agreement.
“ Pricing Grid ”: the pricing grid attached hereto as Annex A.
“ Prior Financial Statements ”: as defined in Section 6.14.
“ Projections ”: as defined in Section 6.2(c).
“ Property ”: any right or interest in or to property of any kind whatsoever, whether real, personal or mixed and whether tangible or intangible, including, without limitation, Capital Stock.
“ Qualified Counterparty ”: with respect to any Specified Hedge Agreement, any counterparty thereto that, at the time such Specified Hedge Agreement was entered into, was a Lender or an affiliate of a Lender.
“ Qualified Domestic Captive Insurance Subsidiary ”: any Domestic Subsidiary of the Borrower which meets the following requirements:
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(a) such Subsidiary is organized for the sole purpose of providing insurance coverage for the Loan Parties and their Subsidiaries (the “ Insurance Business ”);
(b) such Subsidiary has no material assets other than assets related to the Insurance Business and conducts no business other than the Insurance Business; and
(c) the Loan Parties’ Investment in such Subsidiary meets the requirements under Section 7.8.
“ Recovery Event ”: any settlement of or payment in respect of, or series of settlements or payments in respect of, any property or casualty insurance claim or any condemnation proceeding relating to any asset of the Borrower or any of its Subsidiaries in excess of $2,000,000.
“ Refinancing ”: as defined in the Recitals.
“ Refunded Swing Line Loans ”: as defined in Section 2.7(b).
“ Refunding Date ”: as defined in Section 2.7(c).
“ Register ”: as defined in Section 10.6(d).
“ Regulation D ”: Regulation D of the Board as in effect from time to time.
“ Regulation U ”: Regulation U of the Board as in effect from time to time.
“ Regulation X ”: Regulation X of the Board as in effect from time to time.
“ Reimbursement Obligation ”: the obligation of the Borrower to reimburse each Issuing Lender pursuant to Section 3.6 for amounts drawn under Letters of Credit issued by such Issuing Lender.
“ Reinvestment Deferred Amount ”: with respect to any Reinvestment Event, the aggregate Net Cash Proceeds received by the Borrower or any of its Subsidiaries in connection therewith that are not applied to prepay the Term Loans pursuant to Section 2.12(b) as a result of the delivery of a Reinvestment Notice.
“ Reinvestment Event ”: any Asset Sale or Recovery Event in respect of which the Borrower has delivered a Reinvestment Notice.
“ Reinvestment Notice ”: a written notice executed by a Responsible Officer stating that no Default or Event of Default has occurred and is continuing and that the Borrower (directly or indirectly through a Wholly Owned Subsidiary) intends and expects to use all or a specified portion of the Net Cash Proceeds of an Asset Sale or Recovery Event to acquire capital assets useful in its or such Subsidiary’s business.
“ Reinvestment Prepayment Amount ”: with respect to any Reinvestment Event, the Reinvestment Deferred Amount relating thereto less any amount expended prior to the
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relevant Reinvestment Prepayment Date to make Permitted Acquisitions or to acquire capital assets useful in the Borrower’s business.
“ Reinvestment Prepayment Date ”: with respect to any Reinvestment Event, the earlier of (a) the date occurring one year after such Reinvestment Event and (b) the date on which the Borrower shall have determined not to acquire assets useful in the Borrower’s business with all or any portion of the relevant Reinvestment Deferred Amount.
“ Related Fund ”: with respect to any Lender, any fund that (a) invests in commercial loans and (b) is managed or advised by the same investment advisor as such Lender, by such Lender or an affiliate of such Lender.
“ Reorganization ”: with respect to any Multiemployer Plan, the condition that such plan is in reorganization within the meaning of Section 4241 of ERISA.
“ Report Date ”: March 16, 2007.
“ Reportable Event ”: any of the events set forth in Section 4043(c) of ERISA, other than those events as to which the thirty day notice period is waived under subsections .27, .28, .29, .30, .31, .32, .34 or .35 of PBGC Reg. § 4043.
“ Required Lenders ”: at any time, the holders of more than 50% of (a) until the Closing Date, the Commitments and (b) thereafter, the sum of (i) the aggregate unpaid principal amount of the Term Loans then outstanding plus the aggregate amount of then unfunded Tranche B Term Loan Commitments, (ii) the Total Revolving Credit Commitments then in effect or, if the Revolving Credit Commitments have been terminated, the Total Revolving Extensions of Credit then outstanding and (iii) the Total Funded Letter of Credit Commitments then in effect or, if the Funded Letters of Credit Commitments have been terminated, the Total Funded Letter of Credit Exposure at such time.
“ Requirement of Law ”: as to any Person, the Certificate of Incorporation and By-Laws or other organizational or governing documents of such Person, and any law, treaty, rule or regulation or determination of an arbitrator or a court or other Governmental Authority, in each case applicable to or binding upon such Person or any of its Property or to which such Person or any of its Property is subject.
“ Responsible Officer ”: as to any Person, the chief executive officer, chief operating officer, chief accounting officer, president or chief financial officer of such Person, but in any event, with respect to financial matters, the chief accounting officer or the chief financial officer of such Person. Unless otherwise qualified, all references to a “Responsible Officer” shall refer to a Responsible Officer of the Borrower.
“ Restatement ”: the restatement of the Borrower’s financial statements with respect to the first three fiscal quarters of 2003 and prior periods, as a result of write downs or write offs of certain assets, and recording certain charges and making certain additional adjustments, in each case, to the extent disclosed in the Borrower’s press releases and filings with the SEC prior to the Closing Date.
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“ Restricted Payments ”: as defined in Section 7.6.
“ Retire ”: as to Existing Notes, the redemption of Existing Notes in accordance with the applicable Existing Indenture or the repurchase and substantially concurrent surrender thereof for cancellation, in each case, in accordance with the applicable provisions of the Existing Indentures, provided that, if any such Existing Notes are not physically delivered for cancellation, such Existing Notes shall be deemed “Retired” if the Borrower has delivered a certificate to the trustee under the applicable Existing Indenture stating that it has purchased such Existing Notes, that it will not resell such Existing Notes and that it intends to Retire such Existing Notes when such Existing Notes become available for surrender.“ Revolving Administrative Agent ”: as defined in the preamble hereto.
“ Revolving Credit Commitment ”: as to any Lender, the obligation of such Lender, if any, to make Revolving Credit Loans and participate in Swing Line Loans and Revolving Credit Letters of Credit, in an aggregate principal and/or Stated Amount not to exceed the amount set forth under the heading “Revolving Credit Commitment” opposite such Lender’s name on Schedule 1 to the Lender Addendum delivered by such Lender, or, as the case may be, in the Assignment and Acceptance pursuant to which such Lender became a party hereto, as the same may be changed from time to time pursuant to the terms hereof. The original aggregate amount of the Revolving Credit Commitments is $65,000,000.
“ Revolving Credit Commitment Period ”: the period from and including the Closing Date to the Revolving Credit Termination Date.
“ Revolving Credit Facility ”: as defined in the definition of “Facility” in this Section 1.1.
“ Revolving Credit L/C Commitment ”: $25,000,000.
“ Revolving Credit L/C Obligations ”: at any time, an amount equal to the sum of (a) the aggregate Stated Amount of the then outstanding Revolving Credit Letters of Credit and (b) the aggregate amount of drawings under Revolving Credit Letters of Credit that have not then been reimbursed by the Borrower pursuant to Section 3.6.
“ Revolving Credit L/C Participants ”: with respect to any Revolving Credit Letter of Credit, the collective reference to all the Revolving Credit Lenders other than the Issuing Lender that issued such Revolving Credit Letter of Credit.
“ Revolving Credit Lender ”: each Lender that has a Revolving Credit Commitment or holds Revolving Extensions of Credit.
“ Revolving Credit Letters of Credit ”: as defined in Section 3.1(a).
“ Revolving Credit Loans ”: as defined in Section 2.4.
“ Revolving Credit Note ”: as defined in Section 2.8.
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“ Revolving Credit Percentage ”: as to any Revolving Credit Lender at any time, the percentage which such Lender’s Revolving Credit Commitment then constitutes of the Total Revolving Credit Commitments (or, at any time after the Revolving Credit Commitments shall have expired or terminated, the percentage which the aggregate amount of such Lender’s Revolving Extensions of Credit then outstanding constitutes of the amount of the Total Revolving Extensions of Credit then outstanding).
“ Revolving Credit Termination Date ”: the five-year anniversary of the Closing Date or, if earlier, the date on which the Revolving Credit Commitments are terminated in full pursuant to Sections 2.10 or 8 hereof.
“ Revolving Extensions of Credit ”: as to any Revolving Credit Lender at any time, an amount equal to the sum of (a) the aggregate principal amount of all Revolving Credit Loans then outstanding to such Lender, (b) such Lender’s Revolving Credit Percentage of the Revolving Credit L/C Obligations then outstanding and (c) such Lender’s Revolving Credit Percentage of the aggregate principal amount of Swing Line Loans then outstanding.
“ S&P ”: Standard & Poor’s Ratings Services Group.
“ SEC ”: the Securities and Exchange Commission (or successors thereto or an analogous Governmental Authority).
“ Secured Parties ”: as defined in the Guarantee and Collateral Agreement.
“ Security Documents ”: the collective reference to the Guarantee and Collateral Agreement, the Mortgages, any intellectual property security agreements or control agreements required to be delivered pursuant to the Guarantee and Collateral Agreement or any other Loan Document and all other security documents hereafter delivered to the Collateral Agent granting a Lien on any Property of any Person to secure the Obligations.
“ Single Employer Plan ”: any Plan that is covered by Title IV of ERISA, but which is not a Multiemployer Plan.
“ 6 3/8 % Notes ”: the 6 3/8% Senior Notes due 2013 outstanding under the 6 3/8% Notes Indenture in an aggregate principal amount of $150,000,000 as of the date hereof.
“ 6 3/8 % Notes Indenture ”: the Indenture dated as of May 9, 2003, between the Borrower and U.S. Bank National Association, as trustee, as amended and supplemented from time to time prior to the Closing Date.
“ Solvent ”: with respect to any Person, as of any date of determination, (a) the amount of the “present fair saleable value” of the assets of such Person will, as of such date, exceed the amount of all “liabilities of such Person, contingent or otherwise”, as of such date, as such quoted terms are determined in accordance with applicable federal and state laws governing determinations of the insolvency of debtors, (b) the present fair saleable value of the assets of such Person will, as of such date, be greater than the amount that will be required to pay the liability of such Person on its debts as such debts become absolute and matured, (c) such Person will not have, as of such date, an unreasonably small amount of capital with which to conduct its
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business, and (d) such Person will be able to pay its debts as they mature; provided , however , that such determination shall be made without taking into account the Specified Defaults (or the consequences thereof) and assuming that the Loans are made and the Letters of Credit are issued upon request by the Borrower. For purposes of this definition, (i) “debt” means liability on a “claim”, and (ii) “claim” means any (x) right to payment, whether or not such a right is reduced to judgment, liquidated, unliquidated, fixed, contingent, matured, unmatured, disputed, undisputed, legal, equitable, secured or unsecured or (y) right to an equitable remedy for breach of performance if such breach gives rise to a right to payment, whether or not such right to an equitable remedy is reduced to judgment, fixed, contingent, matured or unmatured, disputed, undisputed, secured or unsecured.
“ Specified Change of Control ”: at any time a “change of control” as defined in the 8-3/8% Notes Indenture (if the 8-3/8% Notes have not been Retired at such time), the 6-3/8% Notes Indentures (if the 6-3/8% Notes have not been Retired at such time) or any other item of Indebtedness incurred pursuant to Section 7.2(f), (h) or (i) which is outstanding at such time in an outstanding principal amount in excess of $20,000,000.
“ Specified Defaults ”: (a) any default or event of default under the Existing Notes occurring as a result of any default under the financial reporting or filing of SEC reports (or, to the extent arising therefrom, the compliance with laws) covenants thereof, (b) any default or event of default under any other Indebtedness to the extent the default or event of default is occurring as a result of failure to comply with financial reporting or SEC reporting covenants comparable to those in the Existing Notes (or, to the extent arising therefrom, any comparable compliance with law covenant), (c) any default or event of default under the “cross-default” or “cross-acceleration” provisions of the Existing Notes, to the extent occurring as a result of a default described in clause (a), (b) or (d) of this paragraph, and (d) any default or event of default under the “cross-default” or “cross-acceleration” provisions of any Indebtedness (other than the Existing Notes) occurring as a result of a default or event of default described in clause (a), (b) or (c) of this paragraph. Notwithstanding the foregoing, if any financial information that is or was required to be filed (or would be required to be filed if the Borrower had a class of securities registered under the Securities Exchange Act of 1934 (the “ Exchange Act ”) by the Report Date has not been so filed, any default or event of default arising therefrom (including any default or event of default set forth in clauses (a) and (b) above) shall no longer be a Specified Default.
“ Specified Hedge Agreement ”: any Hedge Agreement entered into by the Borrower or any Guarantor and any Qualified Counterparty providing for protections against fluctuations in interest rates.
“ Stated Amount ”: as to any Letter of Credit, at any time, the maximum amount that then is or may become available to be drawn thereunder, determined without regard to whether any conditions to drawing could then be met.
“ Subordinated Intercompany Note ”: as defined in Section 7.2(b).
“ Subsidiary ”: as to any Person, a corporation, partnership, limited liability company or other entity of which shares of stock or other ownership interests having ordinary voting power (other than stock or such other ownership interests having such power only by
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reason of the happening of a contingency) to elect a majority of the board of directors or other managers of such corporation, partnership or other entity are at the time owned, or the management of which is otherwise controlled, directly or indirectly through one or more intermediaries, or both, by such Person. Unless otherwise qualified, all references to a “Subsidiary” or to “Subsidiaries” in this Agreement shall refer to a Subsidiary or Subsidiaries of the Borrower.
“ Swing Line Commitment ”: the obligation of the Swing Line Lender to make Swing Line Loans pursuant to Section 2.6 in an aggregate principal amount at any one time outstanding not to exceed $10,000,000.
“ Swing Line Lender ”: Wells Fargo, in its capacity as the lender of Swing Line Loans.
“ Swing Line Loans ”: as defined in Section 2.6.
“ Swing Line Note ”: as defined in Section 2.8(e).
“ Swing Line Participation Amount ”: as defined in Section 2.7(c).
“ Syndication Agent ”: as defined in the preamble hereto.
“ Syndication Date ”: the date, which shall not be later than five Business Days after the first Funding Date for Term Loans, on which the Lenders selected in the syndication of the Facilities become parties to this Agreement or any earlier date determined by the Administrative Agent.
“ Synthetic Lease Obligations ”: all monetary obligations of a 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 which 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 treatment).
“ Term Loan Facility ”: the Tranche B Term Loan Facility.
“ Term Loan Lenders ”: the Tranche B Term Loan Lenders.
“ Term Loans ”: the Tranche B Term Loans.
“ Term Notes ”: as defined in Section 2.8(e).
“ Texas Assigning Corporations ”: (a) Yale E. Key, Inc., a Texas corporation, (b) Q.V. Services, Inc., a Louisiana corporation, and (c) Brooks Well Servicing, Inc., WellTech Mid-Continent, Inc., and Key Energy Drilling, Inc., each of which under this clause (c) is a Delaware corporation, and each of which has assigned the beneficial interests in its operating assets, directly or indirectly, to a Texas Assignee Limited Partnership and which owns 100% of the membership interests in a Delaware Assigning Entity and a 1% general partner’s interest in a Texas Assignee Limited Partnership.
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“ Texas Assignee Limited Partnerships : Yale E. Key Beneficial, LP, Brooks Well Servicing Beneficial, LP., WellTech Mid-Continent Beneficial, LP, Key Energy Drilling Beneficial, LP. and Q.V. Services Beneficial, L.P., each of which is a Texas limited partnership whose limited partnership interests are owned by a Delaware Assigning LLC and whose general partnership interests are owned by a Texas Assigning Corporation, and which has received, directly or indirectly, all of the beneficial interests in the operating assets of such Texas Assigning Corporation.
“ Total Credit Linked Deposit ”: atany time, the sum of all Credit Linked Deposits at such time.
“ Total Funded Letter of Credit Commitments ”: at any time the aggregate amount of the Funded Letter of Credit Commitments of all the Lenders at such time.
“ Total Funded Letter of Credit Exposure ”: at any time the aggregate amount of the Funded Letter of Credit Exposure of all the Lenders at such time.
“ Total Revolving Credit Commitments ”: at any time, the aggregate amount of the Revolving Credit Commitments then in effect.
“ Total Revolving Extensions of Credit ”: at any time, the aggregate amount of the Revolving Extensions of Credit of the Revolving Credit Lenders outstanding at such time.
“ Tranche B Funding Date ”: any Business Day on or prior to the Tranche B Term Loan Commitment Expiration Date.
“ Tranche B Term Loan ”: as defined in Section 2.1.
“ Tranche B Term Loan Commitment ”: as to any Lender, the obligation of such Lender, if any, to make a Tranche B Term Loan to the Borrower hereunder in a principal amount not to exceed the amount set forth under the heading “Tranche B Term Loan Commitment” opposite such Lender’s name on Schedule 1 to the Lender Addendum delivered by such Lender, or, as the case may be, in the Assignment and Acceptance pursuant to which such Lender became a party hereto, as the same may be changed from time to time pursuant to the terms hereof. The original aggregate amount of the Tranche B Term Loan Commitments is $400,000,000.
“ Tranche B Term Loan Commitment Expiration Date ”: December 31, 2005, or, if earlier, the date of which the Tranche B Term Loan Commitments are terminated in full pursuant to Sections 2.10 or 8 hereof.
“ Tranche B Term Loan Facility ”: as defined in the definition of “Facility” in this Section 1.1.
“ Tranche B Term Loan Lender ”: each Lender that has a Tranche B Term Loan Commitment or is the holder of a Tranche B Term Loan.
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“ Tranche B Term Loan Percentage ”: as to any Tranche B Term Loan Lender at any time, the percentage which such Lender’s Tranche B Term Loan Commitment then constitutes of the aggregate Tranche B Term Loan Commitments (or, at any time after the initial Funding Date, the percentage which the sum of the aggregate principal amount of such Lender’s Tranche B Term Loans then outstanding plus such Lender’s then unfunded Tranche B Term Loan Commitments constitutes of the aggregate principal amount of the sum of the Tranche B Term Loans then outstanding plus the aggregate amount of the Lenders’ then unfunded Tranche B Term Loan Commitments).
“ Transferee ”: as defined in Section 10.14.
“ Type ”: as to any Loan, its nature as a Base Rate Loan or a Eurodollar Loan.
“ UCC ”: the Uniform Commercial Code, as in effect from time to time in any jurisdiction.
“ United States ”: the United States of America.
“ Weighted Average Life to Maturity ”: when applied to any Indebtedness, at any date, the number of years obtained by dividing (a) the sum of the products obtained by multiplying (i) the amount of each then remaining installment, sinking fund, serial maturity or other required payments of principal, including payment at final maturity, in respect of the Indebtedness, by (ii) the number of years (calculated to the nearest one-twelfth) that will elapse between such date and the making of such payment, by (b) the then outstanding principal amount of such Indebtedness.
“ Wells Fargo ”: Wells Fargo Foothill, Inc.
“ Wholly Owned Guarantor ”: any Guarantor that is a Wholly Owned Subsidiary of the Borrower.
“ Wholly Owned Subsidiary ”: as to any Person, any other Person all of the Capital Stock of which (other than directors’ qualifying shares required by law) is owned by such Person directly and/or through other Wholly Owned Subsidiaries.
1.2 Other Definitional Provisions . (a) Unless otherwise specified therein, all terms defined in this Agreement shall have the defined meanings when used in the other Loan Documents or any certificate or other document made or delivered pursuant hereto or thereto.(b) As used herein and in the other Loan Documents, and any certificate or other document made or delivered pursuant hereto or thereto, accounting terms relating to the Borrower and its Subsidiaries not defined in Section 1.1 and accounting terms partly defined in Section 1.1, to the extent not defined, shall have the respective meanings given to them under GAAP.(c) The words “hereof”, “herein” and “hereunder” and words of similar import when used in this Agreement shall refer to this Agreement as a whole and not to any
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particular provision of this Agreement, and Section, Schedule and Exhibit references are to this Agreement unless otherwise specified.(d) The meanings given to terms defined herein shall be equally applicable to both the singular and plural forms of such terms.(e) All calculations of financial ratios set forth in Section 7.1 shall be calculated to the same number of decimal places as the relevant ratios are expressed in and shall be rounded upward if the number in the decimal place immediately following the last calculated decimal place is five or greater. For example, if the relevant ratio is to be calculated to the hundredth decimal place and the calculation of the ratio is 5.126, the ratio will be rounded up to 5.13.(f) The expressions “payment in full,” “paid in full” and any other similar terms or phrases when used herein with respect to the Obligations shall mean the payment in full, in immediately available funds, of all of the Obligations.SECTION 2. AMOUNT AND TERMS OF COMMITMENTS2.1 Term Loan Commitments . Subject to the terms and conditions hereof, the Tranche B Term Loan Lenders severally agree to make term loans (each, a “ Tranche B Term Loan ”) to the Borrower on each Funding Date in an amount for each Tranche B Term Loan Lender not to exceed the lesser of its (a) Tranche B Term Loan Percentage of the Tranche B Term Loans requested by the Borrower on such Funding Date and (b) its remaining unfunded Tranche B Term Loan Commitment. The Term Loans may from time to time be Eurodollar Loans or Base Rate Loans, as determined by the Borrower and notified to the Administrative Agent in accordance with Sections 2.2 and 2.13. Any unfunded Tranche B Term Loan Commitments shall terminate on the Tranche B Term Loan Commitment Expiration Date, if not borrowed on or before such date.
2.2 Procedure for Term Loan Borrowing . The Borrower shall deliver to the Administrative Agent a Borrowing Notice (which Borrowing Notice must be received by the Administrative Agent prior to 10:00 A.M., New York City time, one Business Day prior to the anticipated Funding Date, in the case of Base Rate Loans, and three Business Days prior to the anticipated Funding Date, in the case of Eurodollar Loans) requesting that the Term Loan Lenders make the Term Loans on such Funding Date and specifying the amount to be borrowed. Upon receipt of such Borrowing Notice the Administrative Agent shall promptly notify each Term Loan Lender thereof. Not later than 12:00 Noon, New York City time, on the Funding Date each Term Loan Lender shall make available to the Administrative Agent at the Funding Office an amount in immediately available funds equal to the Term Loan to be made by such Lender on such Funding Date. The Administrative Agent shall make available to the Borrower the aggregate of the amounts made available to the Administrative Agent by the Term Loan Lenders, in like funds as received by the Administrative Agent.
2.3 Repayment of Term Loans . (a) The Tranche B Term Loan of each Tranche B Term Loan Lender shall mature in 26 consecutive quarterly installments, commencing on March 31, 2006, each of which shall be in an amount equal to such Lender’s
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Tranche B Term Loan Percentage multiplied by the amount set forth below opposite such installment.
(b) If the aggregate principal amount of Tranche B Term Loans made prior to the Tranche B Term Loan Commitment Expiration Date is less than the aggregate amount of the Tranche B Term Loan Commitments as of the Closing Date, the amount of each installment set forth in Section 2.3(a) shall be proportionally reduced.2.4 Revolving Credit Commitments . (a) Subject to the terms and conditions hereof, the Revolving Credit Lenders severally agree to make revolving credit loans (“ Revolving Credit Loans ”) to the Borrower from time to time during the Revolving Credit Commitment Period in an aggregate principal amount at any one time outstanding for each Revolving Credit Lender which, when added to such Lender’s Revolving Credit Percentage of the sum of (i) the Revolving Credit L/C Obligations then outstanding and (ii) the aggregate principal amount of the Swing Line Loans then outstanding, does not exceed the amount of such Lender’s Revolving Credit Commitment. During the Revolving Credit Commitment Period the Borrower may use the Revolving Credit Commitments by borrowing, prepaying the Revolving Credit Loans in whole or in part, and reborrowing, all in accordance with the terms and conditions hereof. The Revolving Credit Loans may from time to time be Eurodollar Loans or Base Rate Loans, as
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determined by the Borrower and notified to the Revolving Administrative Agent in accordance with Sections 2.5 and 2.13, provided that no Revolving Credit Loan shall be made as a Eurodollar Loan after the day that is one month prior to the Revolving Credit Termination Date.(b) The Borrower shall repay all outstanding Revolving Credit Loans on the Revolving Credit Termination Date.2.5 Procedure for Revolving Credit Borrowing . The Borrower may borrow under the Revolving Credit Commitments on any Business Day during the Revolving Credit Commitment Period, provided that the Borrower shall deliver to the Revolving Administrative Agent a Borrowing Notice (which Borrowing Notice must be received by the Revolving Administrative Agent prior to 12:00 Noon, New York City time, (a) three Business Days prior to the requested Borrowing Date, in the case of Eurodollar Loans, or (b) one Business Day prior to the requested Borrowing Date, in the case of Base Rate Loans). Each borrowing of Revolving Credit Loans under the Revolving Credit Commitments shall be in an amount equal to (x) in the case of Base Rate Loans, $1,000,000 or a whole multiple thereof (or, if the then aggregate Available Revolving Credit Commitments are less than $1,000,000, such lesser amount) and (y) in the case of Eurodollar Loans, $5,000,000 or a whole multiple of $1,000,000 in excess thereof; provided , that the Swing Line Lender may request, on behalf of the Borrower, borrowings of Base Rate Loans under the Revolving Credit Commitments in other amounts pursuant to Section 2.7. Upon receipt of any such Borrowing Notice from the Borrower, the Revolving Administrative Agent shall promptly notify each Revolving Credit Lender thereof. Each Revolving Credit Lender will make its Revolving Credit Percentage of the amount of each borrowing of Revolving Credit Loans available to the Revolving Administrative Agent for the account of the Borrower at the Funding Office prior to 12:00 Noon, New York City time, on the Borrowing Date requested by the Borrower in funds immediately available to the Revolving Administrative Agent. Such borrowing will then be made available to the Borrower by the Revolving Administrative Agent in like funds as received by the Revolving Administrative Agent.
2.6 Swing Line Commitment . (a) Subject to the terms and conditions hereof, the Swing Line Lender agrees that, during the Revolving Credit Commitment Period, it will make available to the Borrower in the form of swing line loans (“ Swing Line Loans ”) a portion of the credit otherwise available to the Borrower under the Revolving Credit Commitments; provided that (i) the aggregate principal amount of Swing Line Loans outstanding at any time shall not exceed the Swing Line Commitment then in effect (notwithstanding that the Swing Line Loans outstanding at any time, when aggregated with the Swing Line Lender’s other outstanding Revolving Credit Loans hereunder, may exceed the Swing Line Commitment then in effect or the Swing Line Lender’s Revolving Credit Commitment then in effect) and (ii) the Borrower shall not request, and the Swing Line Lender shall not make, any Swing Line Loan if, after giving effect to the making of such Swing Line Loan, the aggregate amount of the Available Revolving Credit Commitments would be less than zero. During the Revolving Credit Commitment Period, the Borrower may use the Swing Line Commitment by borrowing, repaying and reborrowing, all in accordance with the terms and conditions hereof. Swing Line Loans shall be Base Rate Loans only.
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(b) The Borrower shall repay all outstanding Swing Line Loans on the Revolving Credit Termination Date.2.7 Procedure for Swing Line Borrowing; Refunding of Swing Line Loans . (a) The Borrower may borrow under the Swing Line Commitment on any Business Day during the Revolving Credit Commitment Period, provided , the Borrower shall give the Swing Line Lender irrevocable telephonic notice confirmed promptly in writing (which telephonic notice must be received by the Swing Line Lender not later than 1:00 P.M., New York City time, on the proposed Borrowing Date), specifying (i) the amount to be borrowed and (ii) the requested Borrowing Date. Each borrowing under the Swing Line Commitment shall be in an amount equal to $500,000 or a whole multiple of $100,000 in excess thereof. Not later than 4:00 P.M., New York City time, on the Borrowing Date specified in the borrowing notice in respect of any Swing Line Loan, the Swing Line Lender shall make available to the Revolving Administrative Agent at the Funding Office an amount in immediately available funds equal to the amount of such Swing Line Loan. The Revolving Administrative Agent shall make the proceeds of such Swing Line Loan available to the Borrower on such Borrowing Date in like funds as received by the Revolving Administrative Agent.(b) The Swing Line Lender, at any time and from time to time in its sole and absolute discretion may, on behalf of the Borrower (which hereby irrevocably directs the Swing Line Lender to act on its behalf), on one Business Day’s notice given by the Swing Line Lender no later than 12:00 Noon, New York City time, request each Revolving Credit Lender to make, and each Revolving Credit Lender hereby agrees to make, a Revolving Credit Loan (which shall initially be a Base Rate Loan), in an amount equal to such Revolving Credit Lender’s Revolving Credit Percentage of the aggregate amount of the Swing Line Loans (the “ Refunded Swing Line Loans ”) outstanding on the date of such notice, to repay the outstanding Swing Line Loans. Each Revolving Credit Lender shall make the amount of such Revolving Credit Loan available to the Revolving Administrative Agent at the Funding Office in immediately available funds, not later than 10:00 A.M., New York City time, one Business Day after the date of such notice. The proceeds of such Revolving Credit Loans shall be made immediately available by the Revolving Administrative Agent to the Swing Line Lender for application by the Swing Line Lender to the repayment of the Refunded Swing Line Loans. The Borrower irrevocably authorizes the Swing Line Lender to charge the Borrower’s accounts with the Revolving Administrative Agent (up to the amount available in each such account) in order to immediately pay the amount of such Refunded Swing Line Loans to the extent amounts received from the Revolving Credit Lenders are not sufficient to repay in full such Refunded Swing Line Loans.(c) If prior to the time a Revolving Credit Loan would have otherwise been made pursuant to Section 2.7(b), one of the events described in Section 8(f) shall have occurred and be continuing with respect to the Borrower, or if for any other reason, as determined by the Swing Line Lender in its sole discretion, Revolving Credit Loans may not be made as contemplated by Section 2.7(b), each Revolving Credit Lender shall, on the date such Revolving Credit Loan was to have been made pursuant to the notice referred to in Section 2.7(b) (the “ Refunding Date ”), purchase for cash an undivided participating interest in the then outstanding Swing Line Loans by paying to the Swing Line Lender an amount (the “ Swing Line Participation Amount ”) equal to (i) such Revolving Credit Lender’s Revolving Credit Percentage times (ii) the
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sum of the aggregate principal amount of Swing Line Loans then outstanding which were to have been repaid with such Revolving Credit Loans.(d) Whenever, at any time after the Swing Line Lender has received from any Revolving Credit Lender such Lender’s Swing Line Participation Amount, the Swing Line Lender receives any payment on account of the Swing Line Loans, the Swing Line Lender will distribute to such Lender its Swing Line Participation Amount (appropriately adjusted, in the case of interest payments, to reflect the period of time during which such Lender’s participating interest was outstanding and funded and, in the case of principal and interest payments, to reflect such Lender’s pro rata portion of such payment if such payment is not sufficient to pay the principal of and interest on all Swing Line Loans then due); provided , however , that in the event that such payment received by the Swing Line Lender is required to be returned, such Revolving Credit Lender will return to the Swing Line Lender any portion thereof previously distributed to it by the Swing Line Lender.(e) Each Revolving Credit Lender’s obligation to make the Loans referred to in Section 2.7(b) and to purchase participating interests pursuant to Section 2.7(c) shall be absolute and unconditional and shall not be affected by any circumstance, including, without limitation, (i) any setoff, counterclaim, recoupment, defense or other right which such Revolving Credit Lender or the Borrower may have against the Swing Line Lender, the Borrower or any other Person for any reason whatsoever; (ii) the occurrence or continuance of a Default or an Event of Default or the failure to satisfy any of the other conditions specified in Section 5; (iii) any adverse change in the condition (financial or otherwise) of the Borrower; (iv) any breach of this Agreement or any other Loan Document by the Borrower, any other Loan Party or any other Revolving Credit Lender; or (v) any other circumstance, happening or event whatsoever, whether or not similar to any of the foregoing.2.8 Repayment of Loans; Evidence of Debt . (a) The Borrower hereby unconditionally promises to pay to the Revolving Administrative Agent for the account of the appropriate Revolving Credit Lender or the Swing Line Lender and to the Administrative Agent for the account of the appropriate Term Loan Lender, as the case may be, (i) the then unpaid principal amount of each Revolving Credit Loan of such Revolving Credit Lender on the Revolving Credit Termination Date, (ii) the then unpaid principal amount of each Swing Line Loan of such Swing Line Lender on the Revolving Credit Termination Date and (iii) the principal amount of each Term Loan of such Term Loan Lender in installments according to the amortization schedule set forth in Section 2.3 and, in any event, in full on June 30, 2012 (or on any earlier date on which the Loans become due and payable pursuant to Section 8). The Borrower hereby further agrees to pay interest on the unpaid principal amount of the Loans from time to time outstanding from the date hereof until payment in full thereof at the rates per annum, and on the dates, set forth in Section 2.15.(b) Each Lender shall maintain in accordance with its usual practice an account or accounts evidencing indebtedness of the Borrower to such Lender resulting from each Loan of such Lender from time to time, including the amounts of principal and interest payable and paid to such Lender from time to time under this Agreement.
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(c) The Administrative Agent, in the case of Term Loans, and the Revolving Administrative Agent, in the case of Revolving Credit Loans, shall maintain the Register on behalf of the Borrower pursuant to Section 10.6(d), and a subaccount therein for each Lender, in which shall be recorded (i) the amount of each Loan made hereunder and any Note evidencing such Loan, the Type of such Loan and each Interest Period applicable thereto, (ii) the amount of any principal or interest due and payable or to become due and payable from the Borrower to each Lender hereunder and (iii) both the amount of any sum received by such Agent hereunder from the Borrower and each Lender’s share thereof.(d) The entries made in the Register and the accounts of each Lender maintained pursuant to Section 2.8(b) shall, to the extent permitted by applicable law, be prima facie evidence of the existence and amounts of the obligations of the Borrower therein recorded; provided , however , that the failure of any Lender or the Administrative Agent to maintain the Register or any such account, or any error therein, shall not in any manner affect the obligation of the Borrower to repay (with applicable interest) the Loans made to the Borrower by such Lender in accordance with the terms of this Agreement.(e) The Borrower agrees that, upon request to the Administrative Agent by any Lender, the Borrower will promptly execute and deliver to such Lender a promissory note of the Borrower evidencing any Term Loans, Revolving Credit Loans or Swing Line Loans, as the case may be, of such Lender, substantially in the forms of Exhibit F-1, F-2 or F-3, respectively (a “ Term Note ”, “ Revolving Credit Note ” or “ Swing Line Note ”, respectively), with appropriate insertions as to date and principal amount; provided , that delivery of Notes shall not be a condition precedent to the occurrence of the Closing Date or the making of the Loans on the Closing Date and the obligations of the Borrower in respect of each Loan shall be enforceable in accordance with the provisions of the Loan Documents whether or not evidenced by any Note.2.9 Commitment Fees, etc . (a) The Borrower agrees to pay to the Revolving Administrative Agent for the account of each Revolving Credit Lender a commitment fee for the period from and including the date hereof to the last day of the Revolving Credit Commitment Period, computed at the Commitment Fee Rate applicable to the Revolving Credit Commitments, on the average daily amount of the Available Revolving Credit Commitment of such Lender during the period for which payment is made, payable quarterly in arrears on the last day of each March, June, September and December and on the Revolving Credit Termination Date, commencing on the first of such dates to occur after the date hereof.(b) The Borrower agrees to pay to the Administrative Agent for the account of each Tranche B Term Loan Lender a commitment fee for the period from and including the date hereof to the Tranche B Term Loan Commitment Expiration Date computed at the Commitment Fee Rate applicable to Tranche B Term Loan Commitments, on the product of (i) the daily average amount of the Tranche B Term Loan Commitment of such Lender during the period for which payment is made and (ii) the number of days in such period. Such commitment fee will be payable in arrears on each Funding Date, the Tranche B Term Loan Commitment Expiration Date and, if the Tranche B Term Loan Commitment Expiration Date is after September 30, 2005, on September 30, 2005.
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(c) The Borrower agrees to pay to the Administrative Agent on the Tranche B Term Loan Commitment Expiration Date, for the account of each Tranche B Term Loan Lender in accordance with its Tranche B Term Loan Percentage, a fee equal to 0.50% applied to the difference between (a) $400,000,000 and (b) the aggregate amount of Tranche B Term Loans funded on or before the Tranche B Term Loan Commitment Expiration Date.(d) The Borrower agrees to pay to the Arranger the fees in the amounts and on the dates previously agreed to in writing by the Borrower and the Arranger.(e) The Borrower agrees to pay to each Agent the fees in the amounts and on the dates from time to time agreed to in writing by the Borrower and such Agent.2.10 Termination or Reduction of Commitments . (a) The Borrower shall have the right, upon not less than three Business Days’ notice to the Revolving Administrative Agent, to terminate the Revolving Credit Commitments or, from time to time, to reduce the aggregate amount of the Revolving Credit Commitments; provided that no such termination or reduction of Revolving Credit Commitments shall be permitted if, after giving effect thereto and to any prepayments of the Revolving Credit Loans and Swing Line Loans made on the effective date thereof, the Total Revolving Extensions of Credit would exceed the Total Revolving Credit Commitments. Any such reduction shall be in an amount equal to $1,000,000, or a whole multiple thereof, and shall reduce permanently the Revolving Credit Commitments then in effect.(b) The Borrower shall have the right, upon not less than three Business Days’ notice to the Revolving Administrative Agent, to terminate the Funded Letter of Credit Commitments or, from time to time, to reduce the aggregate amount of the Funded Letter of Credit Commitments; provided that no such termination or reduction of Funded Letter of Credit Commitments shall be permitted if, after giving effect thereto the Total Funded Letter of Credit Exposure would exceed the Total Funded Letter of Credit Commitments. Any such reduction shall be in an amount equal to $1,000,000, or a whole multiple thereof, and shall reduce permanently the Funded Letter of Credit Commitments then in effect. If the Funded Letter of Credit Commitments are reduced as provided in this Section 2.10(b), then the Revolving Administrative Agent will return all amounts in the Credit Linked Deposit | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||